Document:

Exhibit 10.3
  
  Execution Copy
 

 

OMNIBUS AGREEMENT

AMONG

PROVIDENT ENERGY TRUST,

PRO GP CORP.,

BREITBURN ENERGY COMPANY L.P.,

BREITBURN GP, LLC

AND

BREITBURN
ENERGY PARTNERS L.P.

   
 

 

TABLE
OF CONTENTS

	
  ARTICLE I

  	
   

  
	
   

  	
   

  
	
  DEFINITIONS

  	
   

  
	
   

  	
   

  
	
  Section 1.1

  	
  Definitions

  	
  1

  
	
  Section 1.2

  	
  Construction

  	
  3

  
	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
   

  
	
   

  	
   

  
	
  BUSINESS
  OPPORTUNITIES

  	
   

  
	
   

  	
   

  
	
  Section 2.1

  	
  Partnership Business Opportunities

  	
  4

  
	
  Section 2.2

  	
  Provident Business Opportunities

  	
  4

  
	
  Section 2.3

  	
  Scope of Prohibition

  	
  5

  
	
  Section 2.4

  	
  Enforcement

  	
  5

  
	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
   

  
	
   

  	
   

  
	
  RIGHT OF FIRST
  OFFER

  	
   

  
	
   

  	
   

  
	
  Section 3.1

  	
  Right of First Offer Procedures

  	
  5

  
	
  Section 3.2

  	
  Change of Control of Provident

  	
  7

  
	
  Section 3.3

  	
  Exceptions to the Right of First Offer

  	
  7

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
   

  
	
   

  	
   

  
	
  REPRESENTATIONS
  AND WARRANTIES OF PROVIDENT

  	
   

  
	
   

  	
   

  
	
  ARTICLE V

  	
   

  
	
   

  	
   

  
	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  
	
  Section 5.1

  	
  Notices

  	
  8

  
	
  Section 5.2

  	
  Further Action

  	
  9

  
	
  Section 5.3

  	
  Binding Effect

  	
  9

  
	
  Section 5.4

  	
  Integration

  	
  9

  
	
  Section 5.5

  	
  Creditors

  	
  9

  
	
  Section 5.6

  	
  Waiver

  	
  9

  
	
  Section 5.7

  	
  Counterparts

  	
  10

  
	
  Section 5.8

  	
  Applicable Law; Submission to Jurisdiction

  	
  10

  
	
  Section 5.9

  	
  Invalidity of Provisions

  	
  10

  
	
  Section 5.10

  	
  Amendment or Modification

  	
  10

  
	
  Section 5.11

  	
  Assignment

  	
  10

  
	
  Section 5.12

  	
  Termination

  	
  10

  
	
  Section 5.13

  	
  Laws and Regulations

  	
  10

  

 

 OMNIBUS AGREEMENT
  
 i

 

OMNIBUS
AGREEMENT

THIS OMNIBUS AGREEMENT is entered into on, and
effective as of, October 10, 2006 (the “Effective Date”), by and among
Provident Energy Trust, an open-ended unincorporated investment trust formed
under the laws of the Province of Alberta (“Provident”), Pro GP Corp., a
Delaware corporation (“Pro GP”), BreitBurn Energy Company L.P., a Delaware
limited partnership (“BreitBurn Energy”), BreitBurn GP, LLC, a Delaware limited
liability company (the “General Partner”), and BreitBurn Energy Partners L.P.,
a Delaware limited partnership (the “Partnership,” and collectively with Provident,
BreitBurn Energy and the General Partner, the “Parties” and each, a “Party”).

In consideration of the covenants, conditions and
agreements contained herein, the Parties hereto hereby agree as follows:

ARTICLE I

DEFINITIONS

Section 1.1                                      Definitions.

The following definitions shall be for all purposes,
unless otherwise clearly indicated to the contrary, applied to the terms used
in this Agreement.

“Affiliate”
means, with respect to any Person, any other Person that directly or indirectly
through one or more intermediaries controls, is controlled by or is under
common control with, the Person in question. 
As used herein, the term “control” means the possession, direct or
indirect, of the power to direct or cause the direction of the management and
policies of a Person, whether through ownership of voting securities, by
contract or otherwise.

“Agreement”
means this Omnibus Agreement, as it may be amended, supplemented or restated
from time to time.

“Change of Control”
means, with respect to any Person (the “Applicable Person”), any of the
following events: (a) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all or substantially all of
the Applicable Person’s assets to any other Person, unless immediately
following such sale, lease, exchange or other transfer such assets are owned,
directly or indirectly, by the Applicable Person; (b) the amalgamation,
combination, consolidation or merger of the Applicable Person with or into
another Person pursuant to a transaction or series of related transactions,
other than any such transaction(s) where (i) the holders of the Voting
Securities of the Applicable Person immediately prior to such transaction own,
directly or indirectly, not less than a majority of the outstanding Voting
Securities of the surviving Person or its parent immediately after such
transaction and (ii) the board of directors of the surviving person is
comprised of a majority of persons who were directors of the Applicable Person
immediately prior to such transaction; or (c) a “person” or “group” (within the
meaning of Sections 13(d) or 14(d)(2) of the Exchange Act), other than Provident
or its Affiliates with respect to the General Partner, being or becoming the “beneficial
owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act) of more
than 50% of all of the then outstanding

 

Voting Securities of the Applicable Person, except in a merger or
consolidation which would not constitute a Change of Control under clause (b)
above.

“Conflicts Committee”
means the Conflicts Committee of the General Partner.

“Contribution Agreement”
means that certain Contribution, Conveyance and Assumption Agreement, dated as
of the Effective Date, among Provident, BreitBurn Energy, the General Partner,
the Partnership and certain other parties, together with the additional
conveyance documents and instruments contemplated or referenced thereunder.

“Effective Date”
is defined in the introductory paragraph.

“Exchange Act”
means the Securities Exchange Act of 1934, as amended.

“General Partner”
means BreitBurn GP, LLC, a Delaware limited liability company, and its
successors and permitted assigns that are admitted to the partnership as
general partner of the Partnership, in its capacity as general partner of the Partnership
(except as the context otherwise requires).

“Parties” is
defined in the introductory paragraph.

“Partnership Agreement”
means the First Amended and Restated Agreement of Limited Partnership of the Partnership,
dated as of October 10, 2006, as the same may be amended or restated from time
to time.

“Partnership Business
Opportunity” means a business opportunity with respect to (a) any
third party upstream oil and gas properties located in the United States or (b)
any third party upstream oil and gas properties located in the United States and
any related midstream or downstream assets; provided that the fair market value
of such midstream and downstream assets (as determined in good faith by the
Board of Directors of the General Partner) constitutes less than the fair
market value of such upstream assets (as determined in good faith by the Board
of Directors of the General Partner).

“Partnership Business
Opportunity Information” is defined in Section 2.1.

“Partnership Group”
means the General Partner, the Partnership and all of their respective Subsidiaries.

“Person” means
an individual or a corporation, limited liability company, partnership, joint
venture, trust, unincorporated organization, association, government agency or
political subdivision thereof or other entity.

“Provident Business
Opportunity” means a business opportunity with respect to (a) any
third party midstream or downstream assets located in the United States, (b)
any third party midstream or downstream assets located in the United States and
any related upstream assets located in the United States; provided that the
fair market value of such upstream assets (as determined in good faith by
Provident) constitutes less than the fair market value of such midstream and
downstream assets (as determined in good faith by Provident) or (c) any third

 2
 

 

party upstream oil and gas properties or midstream or
downstream assets located outside the United States.

“Provident Business
Opportunity Information” is defined in Section 2.2.

“Provident Group”
means Provident, Pro GP, BreitBurn Energy and all of their respective
Affiliates (other than the Partnership Group).

“Subject Assets”
means all upstream oil and gas properties in the United States owned by the Provident
Group.

“Subsidiary”
means, with respect to any Person, (a) a corporation of which more than 50% of
the voting power of shares entitled (without regard to the occurrence of any
contingency) to vote in the election of directors or other governing body of
such corporation is owned, directly or indirectly, at the date of
determination, by such Person, by one or more Subsidiaries of such Person or a
combination thereof, (b) a partnership (whether general or limited) in which
such Person or a Subsidiary of such Person is, at the date of determination, a
general or limited partner of such partnership, but only if more than 50% of
the partnership interests of such partnership (considering all of the
partnership interests of the partnership as a single class) is owned, directly
or indirectly, at the date of determination, by such Person, by one or more
Subsidiaries of such Person, or a combination thereof, or (c) any other Person
(other than a corporation or a partnership) in which such Person, one or more
Subsidiaries of such Person, or a combination thereof, directly or indirectly,
at the date of determination, has (i) at least a majority ownership interest or
(ii) the power to elect or direct the election of a majority of the directors
or other governing body of such Person.

“Transfer”
including the correlative terms “Transferring”
or “Transferred” means any direct or
indirect transfer, assignment, sale, gift, pledge, hypothecation or other
encumbrance, or any other disposition (whether voluntary, involuntary or by
operation of law) of any assets, property or rights.

“Voting Securities”
means securities of any class of a Person entitling the holders thereof to vote
in the election of members of the board of directors or other similar governing
body of the Person.

Other terms defined herein have the meanings so given
them.

Section 1.2             Construction.

Unless the context requires otherwise: (a) any pronoun
used in this Agreement shall include the corresponding masculine, feminine or
neuter forms, and the singular form of nouns, pronouns and verbs shall include
the plural and vice versa; (b) references to Articles and Sections refer to
Articles and Sections of this Agreement; (c) the terms “include”, “includes”, “including”
and words of like import shall be deemed to be followed by the words “without
limitation”; and (d) the terms “hereof,” “herein” and “hereunder” refer to this
Agreement as a whole and not to any particular provision of this
Agreement.  The table of contents and
headings contained in this Agreement are for reference purposes only, and shall
not affect in any way the meaning or interpretation of this Agreement.

 3
 

 

ARTICLE II

 

BUSINESS
OPPORTUNITIES

Section 2.1                                      Partnership Business Opportunities.

For as long as Provident and its Affiliates maintain a
direct or indirect controlling interest in the General Partner, if the Provident
Group is presented with an opportunity to pursue, purchase or invest in any Partnership
Business Opportunity, Provident shall give prompt written notice to the General
Partner, on behalf of the Partnership Group, of the Partnership Business
Opportunity.  Such notice shall set forth
all information available to the Provident Group including, but not limited to,
the identity of the Partnership Business Opportunity and its seller, the
proposed price, all written information about the Partnership Business
Opportunity provided to the Provident Group by and on behalf of the seller as
well as any information or analyses compiled by the Provident Group from other
sources (such information referred to collectively herein as “Partnership
Business Opportunity Information”).  Provident
shall continue to provide to the General Partner, on behalf of the Partnership
Group, promptly any and all Partnership Business Opportunity Information
subsequently received.  The Parties shall
maintain the confidentiality of all such Partnership Business Opportunity
Information, subject to compliance with applicable law.  As soon as practicable but in any event
within thirty (30) days after receipt of such initial notification and
information, the General Partner, on behalf of the Partnership Group, shall
notify Provident that either (a) the General Partner, on behalf of the Partnership
Group, has elected, with the concurrence of the Partnership’s Conflicts
Committee, to cause a member of the Partnership Group to pursue the opportunity
to acquire or invest in the Partnership Business Opportunity or (b) the General
Partner, on behalf of the Partnership Group, has elected, with the concurrence
of the Partnership’s Conflicts Committee, not to cause a member of the
Partnership Group to pursue the opportunity to acquire or invest in the Partnership
Business Opportunity.  If, at any time,
the General Partner, on behalf of the Partnership Group, abandons such
opportunity with the approval of the Partnership’s Conflicts Committee (as
evidenced in writing by the General Partner following the request of
Provident), the Provident Group may pursue such opportunity.

Section 2.2                                      Provident Business Opportunities.

For as long as Provident and its Affiliates maintain a
direct or indirect controlling interest in the General Partner, if the Partnership
Group is presented with an opportunity to pursue, purchase or invest in any
business opportunity with respect to any Provident Business Opportunity, the General
Partner, on behalf of the Partnership Group, shall give prompt written notice
to Provident of the Provident Business Opportunity.  Such notice shall set forth all information
available to the Partnership Group including, but not limited to, the identity
of the Provident Business Opportunity and its seller, the proposed price, all
written information about the Provident Business Opportunity provided to the Partnership
Group by and on behalf of the seller as well as any information or analyses
compiled by the Partnership Group from other sources (such information referred
to collectively herein as “Provident Business Opportunity Information”).  The General Partner, on behalf of the Partnership
Group, shall continue to provide to Provident promptly any and all Provident
Business Opportunity Information subsequently received.  The Parties shall maintain the
confidentiality of all such Provident

 4
 

 

Business Opportunity Information, subject to
compliance with applicable law.  As soon
as practicable but in any event within thirty (30) days after receipt of such initial
notification and information, Provident shall notify the General Partner, on
behalf of the Partnership Group, that either (a) Provident has elected to cause
a member of the Provident Group to pursue the opportunity to acquire or invest
in the Provident Business Opportunity or (b) Provident has elected not to cause
a member of the Provident Group to pursue the opportunity to acquire or invest
in the Provident Business Opportunity. 
If, at any time, the Provident Group abandons such opportunity (as
evidenced in writing following the request of the General Partner, on behalf of
the Partnership), the Partnership Group may pursue such opportunity.

Section 2.3                                      Scope of Prohibition.

Except as provided in this Article II, the Parties shall
be free to engage in any business activity whatsoever, including those that may
be in direct competition with the Partnership Group or the Provident Group, as
the case may be.

Section 2.4                                      Enforcement.

(a)   The
Parties agree and acknowledge that there is no adequate remedy at law for the
breach by the Parties of the covenants and agreements set forth in this Article
II, and that any breach by the Parties of the covenants and agreements set
forth in Article II would result in irreparable injury.  The Parties further agree and acknowledge
that any Party to this Agreement may, in addition to the other remedies which
may be available hereunder or under applicable law, file a suit in equity to
enjoin the violating Party from such breach, and the Parties consent to the
issuance of injunctive relief hereunder.

(b)   If
any court determines that any provision of this Article II is invalid or
unenforceable, the remainder of such provisions shall not thereby be affected
and shall be given full effect without regard to the invalid provision;
provided, however, that if any court determines that any provision in either Section
2.1 or Section 2.2 is invalid or unenforceable then the corresponding provision
in Section 2.2 or Section 2.1, as the case may be, shall also be invalid or
unenforceable. If any court construes any provision of this Article II, or any
part thereof, to be unreasonable because of the duration of such provision or
the geographic scope thereof, such court shall have the power to reduce the
duration or restrict the geographic scope of such provision and to enforce such
provision as so reduced or restricted.

ARTICLE
III

RIGHT OF
FIRST OFFER

Section 3.1                                      Right of First Offer Procedures.

For as long as Provident and its Affiliates maintain a
direct or indirect controlling interest in the General Partner, if any member
of the Provident Group (the “Disposing Party”) desires to sell or otherwise Transfer
any Subject Assets, the Disposing Party shall provide the Partnership Group a
right of first offer to acquire such Subject Assets (the “Sale Assets”) pursuant
to the following procedures:

 5
 

 

(a)   The
Disposing Party shall deliver a written offer (the “Disposing Party Offer”) to
the General Partner, on behalf of the Partnership Group, which Disposing Party Offer
shall describe the Sale Assets, the purchase price (payable in cash or in
securities of the Partnership at the option of the Disposing Party) at which it
wishes to sell the Sale Assets and the proposed terms of sale.  The Disposing Party Offer shall constitute a
binding offer to sell the Sale Assets to the Partnership Group on the terms set
forth therein;

(b)   the
General Partner, on behalf of the Partnership Group and with the approval of the
Conflicts Committee, shall have a period of forty-five (45) days (the “Negotiation Period”) from the date
of the Offer to accept the Disposing Party Offer or negotiate alternative terms
of sale acceptable to the General Partner, on behalf of the Partnership Group
and with the approval of the Conflicts Committee, and the Disposing Party;

(c)   if
the Disposing Party and the General Partner, on behalf of the Partnership Group
and with the approval of the Conflicts Committee, agree upon the terms of sale
for the Sale Assets prior to the expiration of the Negotiation Period, such Parties
shall enter into definitive documentation to effect such Transfer, which shall
be closed within thirty (30) days after the end of the Negotiation Period or
such longer period as may be reasonably necessary to complete a unitholder vote
by the Partnership (if required) or a financing (if required) or to obtain any
required consents;

(d)   if,
at the end of the Negotiation Period, the Disposing Party and the General Partner,
on behalf of the Partnership Group and with the approval of the Conflicts
Committee, each acting in good faith, have not agreed upon the terms of sale
for the Sale Assets, or if the Transfer is not completed within the period
specified in Section 3.1(c), the Disposing Party may thereafter (i) Transfer
the Sale Assets (subject to any changes in form or condition, financial or
otherwise, which in the reasonable opinion of the Disposing Party are not
material taken as a whole) to a bona fide third
party dealing at arm’s length with the Disposing Party (a “Third Party
Transferee”) at a price and on terms and conditions that, taken as a whole, in
the reasonable opinion of the Disposing Party are not more favorable to the
Third Party Transferee than those contained in the Disposing Party Offer or
(ii) conduct a bona fide auction for the Subject
Assets, seeking offers (each, an “Offer”) to be submitted to the Disposing
Party by a specified date (the “Offer Date”) from two or more Third Party
Transferees and from the General Partner, on behalf of the Partnership with the
approval of the Conflicts Committee, for consideration by the Disposing Party;

(e)   if
the Disposing Party conducts an auction pursuant to Section 3.1(d), the
Disposing Party may accept the Offer that the Disposing Party, acting in good
faith, determines is the best Offer.  If
the Partnership Group does not submit an Offer or if the Partnership Group
submits an Offer that is not determined by the Disposing Party, acting in good
faith, to be the best Offer, the Partnership Group waives all rights to the
purchase of the Sale Assets, provided that the Disposing Party and the Third
Party Transferee consummate the Transfer of the Sale Assets within one hundred
twenty (120) days from the expiration of the Negotiation Period in the case of
a Transfer pursuant to Section 3.1(d)(i), or the Offer Date in the case of an
auction pursuant to Section 3.1(d)(ii);

 6
 

 

(f)    in
the event that the Disposing Party and the Third Party Transferee fail to consummate
the Transfer of the Sale Assets within
the one hundred twenty (120) day period as applicable in Section 3.1(e), the
Partnership Group’s rights under this Article III with respect to the Sale
Assets shall again become effective, and the Disposing Party shall not thereafter
Transfer any of the Sale Assets without first offering such assets to the
Partnership Group in the manner provided in this Section 3.1; and

(g)   upon
any Transfer to a Third-Party Transferee, the Disposing Party shall deliver to
the General Partner, on behalf of the Partnership Group, a copy of the document
evidencing such Transfer.  If the
Transfer is pursuant to Section 3.1 (d)(i) the Disposing Party shall deliver to
the General Partner, on behalf of the Partnership Group, a certificate of an
officer of the Disposing Party stating that the transfer of the Subject Assets
from the Disposing Party to the Third Party Transferee was made at a price and
upon the terms and conditions that, taken as a whole, in the reasonable opinion
of the Disposing Party were not more favorable to the Third Party Transferee
than those set forth in the Offer.

Section 3.2                                      Change of Control of Provident.

Upon a Change of Control of Provident, the right of
first offer granted to the Partnership Group in Section 3.1 only shall apply to
Subject Assets owned by the Provident Group as of the Effective Date.

Section 3.3                                      Exceptions to the Right of First Offer.

The foregoing provisions of Article III shall not be
applicable to:

(a)           a Transfer that
includes Subject Assets and midstream or downstream assets and in which the fair
market value of such Subject Assets that the Disposing Party desires to sell or
otherwise Transfer (as determined in good faith by the Disposing Party)
constitutes less than the fair market value of the midstream or downstream
assets that the Disposing Party desires to sell or otherwise Transfer with such
Subject Assets (as determined in good faith by the Disposing Party); and

(b)           a Transfer of all or
substantially all of the assets of Provident.

ARTICLE
IV

REPRESENTATIONS
AND WARRANTIES OF PROVIDENT

Provident represents and warrants that this Agreement
has been duly authorized, executed and delivered by Provident and is a valid
and legally binding agreement of Provident, enforceable against Provident in
accordance with its terms, provided that,
the enforceability thereof may be limited by (i) bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws relating to or
affecting creditors’ rights generally and by general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and (ii) public policy, applicable law relating to fiduciary
duties and indemnification and an implied covenant of good faith and fair
dealing.

 7
 

 

ARTICLE V

 

MISCELLANEOUS

Section 5.1                                      Notices.

All notices or other communications required or
permitted under, or otherwise in connection with, this Agreement must be in
writing and must be given by depositing same in the U.S. mail, addressed to the
Person to be notified, postpaid and registered or certified with return receipt
requested or by transmitting by national overnight courier or by transmitting
by national overnight courier or by delivering such notice in person or by
facsimile to such Party.  Notice given by
mail, national overnight courier or personal delivery shall be effective upon
actual receipt.  Notice given by
facsimile shall be effective upon confirmation of receipt when transmitted by
facsimile if transmitted during the recipient’s normal business hours or at the
beginning of the recipient’s next business day after receipt if not transmitted
during the recipient’s normal business hours. 
All notices to be sent to a Party pursuant to this Agreement shall be
sent to or made at the address, in each case as follows:

If to Provident:

Provident Energy Trust

800, 112 - 4th Avenue S.W.

Calgary, Alberta T2P OH3

Attention:  Thomas W. Buchanan

Fax:  (403) 261-6696

If to Pro GP Corp.:

515 South Flower Street, Suite 4800

Los Angeles, CA  90071

Attention:  Randall J. Findlay

Fax:  (213) 225-5917

If to BreitBurn Energy:

BreitBurn Energy Company L.P.

515 South Flower Street, Suite 4800

Los Angeles, CA 90071

Attention:  Halbert S. Washburn

Fax:  (213) 225-5917

 8
 

 

If to the General Partner:

BreitBurn GP, LLC

515 South Flower Street, Suite 4800

Los Angeles, CA 90071

Attention:  Halbert S. Washburn

Fax:  (213) 225-5917

If to the Partnership:

BreitBurn Energy Partners L.P.

515 South Flower  Street, Suite 4800

Los Angeles, CA 90071

Attention:  Halbert S. Washburn

Fax:  (213) 225-5917

Section 5.2                                      Further Action.

The Parties shall execute and deliver all documents,
provide all information and take or refrain from taking action as may be
necessary or appropriate to achieve the purposes of this Agreement.

Section 5.3                                      Binding Effect.

This Agreement shall be binding upon and inure to the
benefit of the Parties hereto and their heirs, executors, administrators,
successors, legal representatives and permitted assigns.

Section 5.4                                      Integration.

This Agreement constitutes the entire Agreement among
the Parties hereto pertaining to the subject matter hereof and supersedes all
prior agreements and understandings pertaining thereto.

Section 5.5                                      Creditors.

None of the provisions of this Agreement shall be for
the benefit of, or shall be enforceable by, any creditor of the Partnership.

Section 5.6                                      Waiver.

No failure by any Party to insist upon the strict
performance of any covenant, duty, agreement or condition of this Agreement or
to exercise any right or remedy consequent upon a breach thereof shall
constitute waiver of any such breach of any other covenant, duty, agreement or
condition.

 9
 

 

Section 5.7             Counterparts.

 

This Agreement may be executed in counterparts, all of
which together shall constitute an agreement binding on all the Parties hereto,
notwithstanding that all such Parties are not signatories to the original or
the same counterpart.  Each Party shall
become bound by this Agreement immediately upon affixing its signature hereto.

Section 5.8                                      Applicable Law; Submission to Jurisdiction.

This Agreement shall be construed in accordance with
and governed by the laws of the State of Delaware, without regard to the
principles of conflicts of law.  The
Parties hereby submit to the jurisdiction of the state and federal courts of
the State of Delaware.

Section 5.9                                      Invalidity of Provisions.

If any provision of this Agreement is or becomes
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein shall not be
affected thereby.

Section 5.10                                Amendment or Modification.

This Agreement may be amended or modified from time to
time only by the written agreement of all the Parties hereto; provided,
however, that the Partnership may not, without the prior approval of the
Conflicts Committee, agree to any amendment or modification of this Agreement
that the General Partner determines will adversely affect the holders of Common
Units.  Each such instrument shall be
reduced to writing and shall be designated on its face an “Amendment” or an “Addendum”
to this Agreement.

Section 5.11                                Assignment.

No Party shall have the right to assign its rights or
obligations under this Agreement without the consent of the other Parties
hereto.

Section 5.12                                Termination.

The provisions of Article II of this Agreement (but
not less than all of such Article) may be terminated (a) by Provident upon
notice to the other Parties upon a Change of Control of Provident or (b) by the
General Partner upon notice to the other Parties upon a Change of Control of
the General Partner.

Section 5.13                                Laws and Regulations.

Notwithstanding any provision of this Agreement to the
contrary, no Party hereto shall be required to take any act, or fail to take
any act, under this Agreement if the effect thereof would be to cause such Party
to be in violation of any applicable law, statute, rule or regulation.

 10

 

IN WITNESS WHEREOF, the Parties have executed this
Agreement on, and effective as of, the Effective Date.

	
   

  	
  PROVIDENT ENERGY TRUST

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Thomas W. Buchanan

  	
   

  
	
   

  	
  Name:

  	
  Thomas W. Buchanan

  
	
   

  	
  Title:

  	
  President and Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  PRO GP CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Randall J. Findlay

  	
   

  
	
   

  	
  Name:

  	
  Randall J. Findlay

  
	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BREITBURN ENERGY COMPANY L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Pro GP Corp., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Randall J. Findlay

  	
   

  
	
   

  	
  Name:

  	
  Randall J. Findlay

  
	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BREITBURN GP, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Halbert S. Washburn

  	
   

  
	
   

  	
  Name:

  	
  Halbert S. Washburn

  
	
   

  	
  Title:

  	
  Co-Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BREITBURN ENERGY PARTNERS L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  BreitBurn GP, LLC,

  
	
   

  	
   

  	
  its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Halbert S. Washburn

  	
   

  
	
   

  	
  Name:

  	
  Halbert S. Washburn

  
	
   

  	
  Title:

  	
  Co-Chief Executive Officer

  

 

 OMNIBUS AGREEMENT
 Signature PageExhibit 10.4
  
  Execution Copy
 

ADMINISTRATIVE SERVICES AGREEMENT

AMONG

BREITBURN GP, LLC,

BREITBURN ENERGY PARTNERS L.P.,

BREITBURN OPERATING L.P.,

AND

BREITBURN MANAGEMENT COMPANY, LLC

   
 

TABLE OF CONTENTS

	
  ARTICLE I

  	
   

  
	
   

  	
   

  
	
  DEFINITIONS

  	
   

  
	
   

  	
   

  
	
  Section 1.1

  	
  Definitions

  	
  1

  
	
  Section 1.2

  	
  Construction

  	
  4

  
	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
   

  
	
   

  	
   

  
	
  RETENTION OF
  BREITBURN MANAGEMENT; SCOPE OF SERVICES

  	
   

  
	
   

  	
   

  
	
  Section 2.1

  	
  Retention of BreitBurn Management

  	
  4

  
	
  Section 2.2

  	
  Scope of Services

  	
  5

  
	
  Section 2.3

  	
  Exclusion of Services

  	
  5

  
	
  Section 2.4

  	
  Performance of Services by Affiliates and Third
  Parties

  	
  5

  
	
  Section 2.5

  	
  Intellectual Property

  	
  5

  
	
  Section 2.6

  	
  Appointment of Independent Accounting Firm and
  Independent Petroleum Engineer

  	
  6

  
	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
   

  
	
   

  	
   

  
	
  BOOKS, RECORDS
  AND REPORTING

  	
   

  
	
   

  	
   

  
	
  Section 3.1

  	
  Books and Records

  	
  6

  
	
  Section 3.2

  	
  Audits

  	
  6

  
	
  Section 3.3

  	
  Reports

  	
  6

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
   

  
	
   

  	
   

  
	
  PAYMENT AMOUNT

  	
   

  
	
   

  	
   

  
	
  Section 4.1

  	
  Payment Amount

  	
  6

  
	
  Section 4.2

  	
  Payment of Payment Amount

  	
  7

  
	
  Section 4.3

  	
  Disputed Charges

  	
  7

  
	
  Section 4.4

  	
  Set Off

  	
  8

  
	
  Section 4.5

  	
  BreitBurn Management’s Employees

  	
  8

  
	
  Section 4.6

  	
  Approval of Expenses

  	
  8

  
	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
   

  
	
   

  	
   

  
	
  FORCE MAJEURE

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 5.1

  	
  Force Majeure

  	
  9

  

 BREITBURN ENERGY PARTNERS L.P.
 ADMINISTRATIVE SERVICES AGREEMENT
 i

 

	
  ARTICLE VI

  	
   

  
	
   

  	
   

  
	
  ASSIGNMENTS AND
  SUBCONTRACTS

  	
   

  
	
   

  	
   

  
	
  Section 6.1

  	
  Assignments

  	
  9

  
	
  Section 6.2

  	
  Other Requirements

  	
  9

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
   

  
	
   

  	
   

  
	
  TERMINATION

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 7.1

  	
  Termination by the Partnership on behalf of the
  Partnership Group

  	
  10

  
	
  Section 7.2

  	
  Termination by BreitBurn Management

  	
  10

  
	
  Section 7.3

  	
  Effect of Termination

  	
  11

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
   

  
	
   

  	
   

  
	
  CONFIDENTIAL INFORMATION

  	
   

  
	
   

  	
   

  
	
  Section 8.1

  	
  Nondisclosure

  	
  11

  
	
  Section 8.2

  	
  Permitted
  Disclosure

  	
  11

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
   

  
	
   

  	
   

  
	
  LIMITATION OF LIABILITY; INDEMNIFICATION

  	
   

  
	
   

  	
   

  
	
  Section 9.1

  	
  Limitation of
  Liability

  	
  12

  
	
  Section 9.2

  	
  Indemnification

  	
  12

  
	
   

  	
   

  	
   

  
	
  ARTICLE X

  	
   

  
	
   

  	
   

  
	
  DISPUTE RESOLUTION

  	
   

  
	
   

  	
   

  
	
  ARTICLE XI

  	
   

  
	
   

  	
   

  
	
  GENERAL
  PROVISIONS

  	
   

  
	
  Section 11.1

  	
  Notices

  	
  13

  
	
  Section 11.2

  	
  Further Action

  	
  14

  
	
  Section 11.3

  	
  Binding Effect

  	
  14

  
	
  Section 11.4

  	
  Integration

  	
  14

  
	
  Section 11.5

  	
  Creditors

  	
  14

  
	
  Section 11.6

  	
  Waiver

  	
  14

  
	
  Section 11.7

  	
  Counterparts

  	
  14

  
	
  Section 11.8

  	
  Applicable Law

  	
  14

  

  
 ii

 

	
  Section 11.9

  	
  Invalidity of Provisions

  	
  15

  
	
  Section 11.10

  	
  Amendment or Restatement

  	
  15

  
	
  Section 11.11

  	
  Directly or Indirectly

  	
  15

  

 

 iii

ADMINISTRATIVE
SERVICES AGREEMENT

THIS ADMINISTRATIVE SERVICES AGREEMENT is entered into
on, and effective as of October 10, 2006 (the “Effective Date”), among BreitBurn
GP, LLC, a Delaware limited liability company (the “General Partner”), BreitBurn
Energy Partners L.P., a Delaware limited partnership (the “Partnership”),
BreitBurn Operating L.P., a Delaware limited partnership (the “Operating
Partnership”), and BreitBurn Management Company, LLC, a Delaware limited
liability company (“BreitBurn Management,” and collectively with the General
Partner, the Partnership and the Operating Partnership, the “Parties” and each, a “Party”).

RECITALS

A.            The
Partnership is the owner, directly or indirectly, of interests in the Business
(as hereinafter defined);

B.            The
Partnership Group (as hereinafter defined) requires certain services to operate
the Business and to fulfill other general and administrative functions relating
to the Business; and

C.            The
Partnership Group desires that BreitBurn Management provide such services, and BreitBurn
Management is willing to undertake such engagement, subject to the terms and
conditions of this Agreement;

NOW, THEREFORE, the Partnership and BreitBurn
Management agree as follows:

ARTICLE I

DEFINITIONS

Section 1.1          Definitions.

The following definitions shall be for all purposes,
unless otherwise clearly indicated to the contrary, applied to the terms used
in this Agreement.

“Affiliate” means, with respect to any Person, any other
Person that directly or indirectly through one or more intermediaries controls,
is controlled by or is under common control with, the Person in question. As
used herein, the term “control” means the possession, direct or indirect, of
the power to direct or cause the direction of the management and policies of a
Person, whether through ownership of voting securities, by contract or
otherwise.

“Agreement” means this Administrative Services Agreement, as
it may be amended, supplemented or restated from time to time.

“Business” means the business of the Partnership Group.

“Bankrupt” with respect to any Person means such Person shall
generally be unable to pay its debts as such debts become due, or shall so
admit in writing or shall make a general assignment for the benefit of
creditors; or any proceeding shall be instituted by or against such Person
seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation,
winding up,

reorganization, arrangement, adjustment, protection,
relief, or composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the entry of an
order for relief or the appointment of a receiver, trustee, or other similar
official for it or for any substantial part of its property and, in the case of
any such proceeding instituted against it (but not instituted by it), shall
remain undismissed or unstayed for a period of 30 days; or such Person shall
take any action to authorize any of the actions set forth above.

“BreitBurn Energy”
means BreitBurn Energy Company L.P., a Delaware limited partnership.

“BreitBurn
Management Party” is defined in Section 9.1.

“Confidential
Information” means non-public information about the disclosing Party’s or any of its
Affiliates’ business or activities that is proprietary and confidential, which
shall include, without limitation, all business, financial, technical and other
information, including software (source and object code) and programming code,
of a Party or its Affiliates marked or designated “confidential” or “proprietary”
or by its nature or the circumstances surrounding its disclosure it should
reasonably be regarded as confidential. 
Confidential Information includes not only written or other tangible
information, but also information transferred orally, visually, electronically or
by any other means.  Confidential
Information does not include information that (i) is in or enters the public
domain without breach of this Agreement, or (ii) the receiving Party lawfully
receives from a third party without restriction on disclosure and to the
receiving Party’s knowledge without breach of a nondisclosure obligation.

“Damages” is defined in Section 9.2.

“Default Rate” means an interest rate (which
shall in no event be higher than the rate permitted by applicable law) equal to
the prime interest rate of the Operating Partnership’s principal lender.

“Effective Date” is defined in the introductory paragraph.

“Environmental Law”
means current local, county, state, federal, and/or foreign law (including
common law), statute, code, ordinance, rule, order, judgment, decree,
regulation or other legal obligation relating to the protection of health,
safety or the environment or natural resources, including, without limitation,
the Comprehensive Environmental Response Compensation and Liability Act (42
U.S.C. section 9601 et seq.), as amended, the Resource Conservation and
Recovery Act (42 U.S.C. section 6901 et seq.), as amended, the Federal Water
Pollution Control Act (33 U.S.C. section 1251 et seq.), as amended, the Clean
Air Act (42 U.S.C. section 7401 et seq.), as amended, the Toxic Substances
Control Act (15 U.S.C. section 2601 et seq.), as amended, the Occupational
Safety and Health Act (29 U.S.C. section 651 et seq.), as amended, the Safe
Drinking Water Act (42 U.S.C. section 300(f) et seq.), as amended, analogous
state, tribal or local laws, and any similar, implementing or successor law,
and any amendment, rule, regulation, or directive issued thereunder, including
any determination by, or interpretation of any of the foregoing by any Governmental
Authority that has the force of law.

 2
 

 

“Force Majeure” means any cause beyond the reasonable control
of a Party, including the following causes (unless they are within such Party’s
reasonable control): acts of God, strikes, lockouts, acts of the public enemy,
wars or warlike action (whether actual or impending), arrests and other
restraints of government (civil or military), blockades, embargoes,
insurrections, riots, epidemics, landslides, lightning, earthquakes, fires,
sabotage, tornadoes, named tropical storms and hurricanes, and floods, civil
disturbances, terrorism, mechanical breakdown of machinery or equipment,
explosions, confiscation or seizure by any government or other public
authority, any order of any court of competent jurisdiction, regulatory agency
or governmental body having jurisdiction.

“G&A Services”
means those general and administrative services necessary or useful for the
conduct of the business of the Partnership Group, including, but not limited
to, accounting, corporate development, finance, land, legal and engineering.

“Governmental Approval”
means any material consent, authorization, certificate, permit, right-of-way
grant or approval of any Governmental Authority that is necessary for the
construction, ownership and operation of the Assets in accordance with
applicable Laws.

“Governmental
Authority” means any court or tribunal in any jurisdiction or any
federal, state, tribal, municipal or local government or other governmental
body, agency, authority, department, commission, board, bureau,
instrumentality, arbitrator or arbitral body or any quasi-governmental or
private body lawfully exercising any regulatory or taxing authority.

“Laws”
means any applicable statute, Environmental Law, common law, rule, regulation,
judgment, order, ordinance, writ, injunction or decree issued or promulgated by
any Governmental Authority.

“Parties” is defined in the introductory paragraph.

“Partnership” is
defined in the introductory paragraph.

“Partnership Agreement” means the First Amended and Restated
Agreement of Limited Partnership of the Partnership, as may be amended or
restated from time to time.

“Partnership Group” means the General Partner, the
Partnership, the Operating Partnership and all of their respective
Subsidiaries.

“Partnership Group Party” is
defined in Section 9.1.

“Payment Amount” is defined in Section 4.1.

“Person” means an individual or a corporation, limited
liability company, partnership, joint venture, trust, unincorporated
organization, association, government agency or political subdivision thereof
or other entity.

“Services” is defined in Section 2.2.

  
 3
 

 

“Subsidiary” means,
with respect to any Person, (a) a corporation of which more than 50% of the
voting power of shares entitled (without regard to the occurrence of any contingency)
to vote in the election of directors or other governing body of such
corporation is owned, directly or indirectly, at the date of determination, by
such Person, by one or more Subsidiaries of such Person or a combination
thereof, (b) a partnership (whether general or limited) in which such Person or
a Subsidiary of such Person is, at the date of determination, a general or
limited partner of such partnership, but only if more than 50% of the
partnership interests of such partnership (considering all of the partnership
interests of the partnership as a single class) is owned, directly or
indirectly, at the date of determination, by such Person, by one or more
Subsidiaries of such Person, or a combination thereof, or (c) any other Person
(other than a corporation or a partnership) in which such Person, one or more
Subsidiaries of such Person, or a combination thereof, directly or indirectly,
at the date of determination, has (i) at least a majority ownership interest or
(ii) the power to elect or direct the election of a majority of the directors
or other governing body of such Person.

Other terms defined herein have the meanings so given
them.

Section 1.2          Construction.

Unless the context requires otherwise: (a) any pronoun
used in this Agreement shall include the corresponding masculine, feminine or
neuter forms, and the singular form of nouns, pronouns and verbs shall include
the plural and vice versa; (b) references to Articles and Sections refer to
Articles and Sections of this Agreement; (c) references to Exhibits refer to
the Exhibits attached to this Agreement, each of which is made a part hereof
for all purposes; (d) the terms “include”, “includes”, “including” and words of
like import shall be deemed to be followed by the words “without limitation”; (e)
the terms “hereof,” “herein” and “hereunder” refer to this Agreement as a whole
and not to any particular provision of this Agreement; and (f) references to
money refer to legal currency of the United States of America.  The table of contents and headings contained
in this Agreement are for reference purposes only, and shall not affect in any
way the meaning or interpretation of this Agreement.

ARTICLE
II

RETENTION OF BREITBURN MANAGEMENT; SCOPE OF SERVICES

Section 2.1          Retention of BreitBurn Management.

The Partnership hereby engages BreitBurn Management to
perform the Services, as directed by the General Partner, and to provide all personnel
and any facilities, goods and equipment not otherwise provided by the
Partnership Group necessary to perform the Services.  BreitBurn Management hereby accepts such
engagement and agrees to perform the Services requested by the General Partner and
to provide any personnel, facilities, goods and equipment not otherwise
provided by the Partnership Group, and to provide all employees as may be
reasonable and necessary to perform the Services.  The Partnership recognizes that BreitBurn
Management is concurrently entering into an Administrative Services Agreement
with BreitBurn Energy.

  
 4
 

 

Section 2.2          Scope of Services.

The “Services”
shall consist of such services the General Partner determines may be reasonable
and necessary to operate the Business, including, without limitation, any
G&A Services and those services described on Schedule I hereto.  BreitBurn Management hereby covenants and
agrees that the Services will be performed in accordance with (i) applicable
material Governmental Approvals and Laws and (ii) industry standards.

Section 2.3          Exclusion of Services.

The General Partner may temporarily or permanently exclude
any particular service from the scope of the Services upon 90 days’ notice to BreitBurn
Management.

Section 2.4          Performance of Services by Affiliates and Third
Parties.

The Parties hereby agree that in discharging its
obligations hereunder, BreitBurn Management may engage any of its Affiliates or
any qualified third party to perform the Services (or any part of the Services)
on its behalf and that the performance of the Services (or any part of the
Services) by any such Affiliate or third party shall be treated as if BreitBurn
Management performed such Services itself. 
Notwithstanding the foregoing, nothing contained herein shall relieve
BreitBurn Management of its obligations hereunder.

Section 2.5          Intellectual Property.

(a)           Any (i) inventions,
whether patentable or not, developed or invented, or (ii) copyrightable
material (and the intangible rights of copyright therein) developed, by
BreitBurn Management, its Affiliates or its or their employees in connection
with the performance of the Services shall be the property of BreitBurn
Management; provided,
however, that the Partnership Group shall be granted an irrevocable,
royalty-free, non-exclusive and non-transferable right and license to use such
inventions or material; and further provided, however, that the Partnership Group shall only be
granted such a right and license to the extent such grant does not conflict
with, or result in a breach, default, or violation of a right or license to use
such inventions or material granted to BreitBurn Management by any Person other
than an Affiliate of BreitBurn Management. 
Notwithstanding the foregoing, BreitBurn Management will use all
commercially reasonable efforts to grant such right and license to the
Partnership Group.

(b)           The General Partner
and the Partnership and the Operating Partnership hereby grant to BreitBurn
Management and its Affiliates an irrevocable, royalty-free, non-exclusive and
non-transferable right and license to use, during the term of this Agreement,
any intellectual property provided by the Partnership Group to BreitBurn
Management or its Affiliates, but only to the extent such use is necessary for
the performance of the Services. 
BreitBurn Management agrees that it and its Affiliates will utilize such
intellectual property solely in connection with the performance of the
Services.

  
 5
 

 

Section 2.6          Appointment of Independent Accounting Firm and
Independent Petroleum Engineer.

Notwithstanding anything to the contrary in this
Agreement, the Parties hereby recognize and agree that the General Partner
shall have the exclusive authority to appoint an independent accounting firm to
audit the financial statements of the Partnership and an independent petroleum
engineer to provide reports to the Partnership relating to estimates of proved
reserves for Securities and Exchange Commission and other reporting purposes.

ARTICLE
III

BOOKS, RECORDS AND REPORTING

Section 3.1          Books and Records.

BreitBurn Management shall maintain accurate books and
records regarding the performance of the Services and its calculation of the
Payment Amount, and shall maintain such books and records for the period
required by applicable accounting practices or law.

Section 3.2          Audits.

The Partnership shall have the right, upon reasonable
notice, and at all reasonable times during usual business hours, to audit,
examine and make copies of the books and records referred to in Section 3.1.  Such right may be exercised through any agent
or employee of the Partnership Group designated in writing by it or by an
independent public accountant, engineer, attorney or other agent so
designated.  The Partnership shall bear
all costs and expenses incurred in any inspection, examination or audit.  BreitBurn Management shall review and respond
in a timely manner to any claims or inquiries made by the Partnership regarding
matters revealed by any such inspection, examination or audit.

Section 3.3         Reports.

BreitBurn Management shall prepare and deliver to the
Partnership any reports provided for in this Agreement and such other reports
as the Partnership may reasonably request from time to time regarding the
performance of the Services.

ARTICLE
IV

PAYMENT AMOUNT

Section 4.1          Payment Amount.

The Partnership shall reimburse BreitBurn Management
on a monthly basis for all direct and indirect expenses BreitBurn Management incurs,
or payments it makes on behalf of the Partnership Group or expenses allocated
to BreitBurn Management by its Affiliates, in each case in connection with the
performance by BreitBurn Management or its Affiliates of the Services
(including, subject to Section 4.5, salary, bonus, incentive compensation and
other amounts paid

  
 6
 

 

to any Person to perform the Services) (collectively,
the “Payment Amount”); provided, however, that
to the extent any Services performed by BreitBurn Management or its Affiliates
benefit both the Partnership and BreitBurn Energy, each of the Partnership and
BreitBurn Energy shall be responsible for reimbursement of BreitBurn Management
for such Services in proportion to the benefits each of them received therefrom.  BreitBurn Management shall charge the
Partnership based on BreitBurn Management’s good-faith determination of the
actual time spent by its personnel performing the Services, plus related
expenses.  BreitBurn
Management personnel providing services to both the Partnership and one or more
other affiliates shall be charged based on BreitBurn Management’s good faith
estimate of actual time spent performing the services plus expenses or on other
systematic and rational allocations as determined by BreitBurn Management.  Notwithstanding the foregoing, the
Partnership shall be obligated to reimburse BreitBurn Management for a portion
of the cost of the existing benefit plans of BreitBurn Management, including
those plans of BreitBurn Energy Company L.P. adopted by BreitBurn
Management.  The amount of the
reimbursement shall be determined by BreitBurn Management on any basis that it
deems to be reasonable and need not be based on the amount of services
performed for the Partnership.

Section 4.2          Payment of Payment Amount.

BreitBurn Management shall invoice the Partnership on
or before the 25th day of each month for the estimated Payment Amount for the
next succeeding month, plus or minus any adjustment necessary to correct prior
estimated billings to actual billings. Subject to Section 4.3, all invoices
shall be due and payable, in immediately available funds, on the last day of
the month to which the invoice relates. Upon the request of the Partnership,
BreitBurn Management shall furnish a reasonable detail of the Services provided
and charges assessed during any month.

Section 4.3          Disputed Charges.

THE PARTNERSHIP MAY, WITHIN 120 DAYS AFTER RECEIPT OF
A CHARGE FROM BREITBURN MANAGEMENT, TAKE WRITTEN EXCEPTION TO SUCH CHARGE, ON
THE GROUND THAT THE SAME WAS NOT A REASONABLE COST INCURRED BY BREITBURN
MANAGEMENT OR ITS AFFILIATES IN CONNECTION WITH THE SERVICES. THE PARTNERSHIP
SHALL NEVERTHELESS PAY BREITBURN MANAGEMENT IN FULL WHEN DUE THE FULL PAYMENT
AMOUNT OWED TO BREITBURN MANAGEMENT. SUCH PAYMENT SHALL NOT BE DEEMED A WAIVER
OF THE RIGHT OF THE PARTNERSHIP TO RECOUP ANY CONTESTED PORTION OF ANY AMOUNT
SO PAID. HOWEVER, IF THE AMOUNT AS TO WHICH SUCH WRITTEN EXCEPTION IS TAKEN, OR
ANY PART THEREOF, IS ULTIMATELY DETERMINED NOT TO BE A REASONABLE COST INCURRED
BY BREITBURN MANAGEMENT OR ITS AFFILIATES IN CONNECTION WITH ITS PROVIDING THE
SERVICES HEREUNDER, SUCH AMOUNT OR PORTION THEREOF (AS THE CASE MAY BE) SHALL
BE REFUNDED BY BREITBURN MANAGEMENT TO THE PARTNERSHIP TOGETHER WITH INTEREST
THEREON AT THE DEFAULT RATE DURING THE PERIOD FROM THE DATE OF PAYMENT BY THE
PARTNERSHIP TO THE DATE OF REFUND BY BREITBURN MANAGEMENT.

  
 7
 

 

Section 4.4          Set Off.

In the event that BreitBurn Management owes the
Partnership a sum certain in an uncontested amount under any other agreement,
then any such amounts may be aggregated and the Partnership and BreitBurn
Management may discharge their obligations by netting those amounts against any
amounts owed by the Partnership to BreitBurn Management under this
Agreement.  If the Partnership or
BreitBurn Management owes the other party a greater aggregate amount, that
Party may pay to the other Party the difference between the amounts owed.

Section 4.5          BreitBurn Management’s Employees.

The obligations under Sections 4.1 and 4.2, to the extent
they relate to Services provided by employees of BreitBurn Management or its
Affiliates, shall be limited to payment to BreitBurn Management for expenses in
connection with its or its Affiliates’ employees engaged in the provision of
Services hereunder, and the Partnership shall not be obligated to pay to
BreitBurn Management’s or its Affiliates’ employees directly any compensation,
salaries, wages, bonuses, benefits, social security taxes, workers’
compensation insurance, retirement and insurance benefits, training and other
such expenses; provided, however, that the Partnership may, at its option,
compensate such employees under the Partnership’s Long-Term Incentive Plan for
the provision of Services hereunder; and provided further, however, that if BreitBurn
Management fails to pay any employee, with the exception of employee claims for
amounts owed that BreitBurn Management disputes in good faith, within 30 days
of the date such employee’s payment is due:

(a)           The Partnership may
(i) pay such employee directly, (ii) employ such employee directly, (iii)
notify BreitBurn Management and begin to pay all employees providing service to
the Partnership directly, or (iv) notify BreitBurn Management that this
Agreement is terminated and employ all employees directly; and

(b)           BreitBurn Management
shall reimburse the Partnership, as the case may be, the amount the Partnership
paid to BreitBurn Management for employee services that BreitBurn Management
did not pay to any such employee.

The Partnership recognizes that, pursuant to the Administrative
Services Agreement between BreitBurn Management and BreitBurn Energy, BreitBurn
Management will have similar rights to those of the Partnership contained in
this Section 4.5.

Section 4.6          Approval of Expenses.

BreitBurn Management acknowledges that all charges for
Services assessed by BreitBurn Management and included in the Payment Amount
must be approved by the persons authorized to approve such Payment Amount
pursuant to the Partnership’s governance and delegation-of-authority process.  Additionally, BreitBurn Management
acknowledges that the Audit Committee of the General Partner’s Board of
Directors may at any time review the Payment Amounts and the levels of Services
and, as a result, may direct the Partnership to decrease the level of Services
or to dispute a prior invoice pursuant to Section 4.3.  In addition to the information BreitBurn

  
 8
 

 

Management is obligated to provide pursuant to Section
4.2, BreitBurn Management shall provide such other information as reasonably
necessary to determine the veracity or appropriateness of any Payment Amount
hereunder.

ARTICLE V

FORCE MAJEURE

Section 5.1          Force Majeure.

A Party’s obligation under this Agreement shall be
excused when and to the extent its performance of that obligation is prevented
due to Force Majeure; provided, however, that a Party shall not be excused by
Force Majeure from any obligation to pay money. 
The Party that is prevented from performing its obligation by reason of
Force Majeure shall promptly notify the other Parties of that fact and shall
exercise due diligence to end its inability to perform as promptly as
practicable.  Notwithstanding the
foregoing, a Party is not required to settle any strike, lockout or other labor
dispute in which it may be involved; provided, however, that, in the
event of a strike, lockout or other labor dispute affecting BreitBurn
Management, BreitBurn Management shall use reasonable efforts to continue to
perform all obligations hereunder by utilizing its management personnel and
that of its Affiliates.

ARTICLE
VI

ASSIGNMENTS AND SUBCONTRACTS

Section 6.1          Assignments.

(a)           Without the prior
consent of BreitBurn Management, none of the Partnership or the other members or
the Partnership Group may sell, assign, transfer or convey any of its rights,
or delegate any of its obligations, under this Agreement to any Person.

(b)           Without the prior
consent of the Partnership, BreitBurn Management may not sell, assign, transfer
or convey any of its rights, or delegate any of its obligations, under this
Agreement to any Person, other than the delegation of performance of Services
to an Affiliate of BreitBurn Management or a qualified third party as permitted
by Section 2.4 and the sale, assignment, transfer or conveyance of its rights
hereunder to any such Affiliate.

Section 6.2          Other Requirements.

Subject to the other provisions hereof:

(a)           All materials and
workmanship used or provided in performing the Services shall be in accordance
with applicable specifications and standards.

(b)           BreitBurn Management
shall exercise reasonable diligence to obtain the most favorable terms or
warranties available from vendors, suppliers and other third parties, and where
appropriate, BreitBurn Management shall assign such warranties to the
Partnership.

  
 9
 

 

(c)           In rendering the
Services, BreitBurn Management shall not discriminate against any employee or
applicant for employment because of race, creed, color, religion, sex, national
origin, age or handicap, and shall comply with all applicable provisions of
Executive Order 11246 of September 24, 1965, and any successor order
thereto.  Subject to the above, BreitBurn
Management shall, to the extent practicable, engage employees who reside in or
whose businesses are located in the local area or state where the Services are
performed.

(d)           BreitBurn Management
agrees to exercise reasonable diligence to ensure that, during the term of this
Agreement, it shall not employ unauthorized aliens as defined in the
Immigration Reform and Control Act of 1986, or any successor law.

ARTICLE
VII

TERMINATION

Section 7.1          Termination by the Partnership on
behalf of the Partnership Group.

(a)           Upon the occurrence
of any of the following events, the Partnership, on behalf of the Partnership
Group, may terminate this Agreement by giving written notice of such
termination to BreitBurn Management:

(i)      Provident Energy Trust and its Affiliates
cease to maintain a direct or indirect controlling interest in the General
Partner or BreitBurn Management; or

(ii)     BreitBurn Management’s failure to pay any
employee within thirty (30) days of the date such employee’s payment is due,
subject to the limitations described in Section 4.5.

Any termination under this Section 7.1(a) shall become
effective immediately upon delivery of the notice first described in this Section
7.1(a), or such later time (not to exceed the first anniversary of the delivery
of such notice) as may be specified by the Partnership.

(b)           In addition to its
rights under Section 7.1(a), the Partnership may terminate this Agreement at
any time by giving notice of such termination to BreitBurn Management.  Any termination under this Section 7.1(b)
shall become effective 90 days after delivery of such notice, or such later
time (not to exceed the first anniversary of the delivery of such notice) as
may be specified by the Partnership.

(c)           In the event that
BreitBurn Management becomes Bankrupt or dissolves and commences liquidation or
winding-up, this Agreement shall automatically terminate without notice to
BreitBurn Management.

Section 7.2          Termination by BreitBurn Management.

(a)           BreitBurn Management
may terminate this Agreement by giving written notice of such termination to the
Partnership in the event that Provident Energy Trust and its Affiliates cease
to maintain a direct or indirect controlling interest in the General Partner or

  
 10
 

 

BreitBurn
Management.  Any termination under this Section
7.2(a) shall become effective immediately upon delivery of the notice first
described in this Section 7.2(a).

(b)           In addition to its
rights under Section 7.2(a), BreitBurn Management may terminate this Agreement
at any time by giving notice of such termination to the Partnership. Any
termination under this Section 7.2(b) shall become effective 90 days after
delivery of such notice, or such later time (not to exceed the first
anniversary of the delivery of such notice) as may be specified by BreitBurn
Management.

Section 7.3          Effect of Termination.

If this Agreement is terminated in accordance with Section
7.1 or 7.2, all rights and obligations under this Agreement shall cease except
for (a) obligations that expressly survive termination of this Agreement; (b)
liabilities and obligations that have accrued prior to such termination,
including the obligation to pay any amounts that have become due and payable
prior to such termination, and (c) the obligation to pay any portion of the
Payment Amount that has accrued prior to such termination, even if such portion
has not become due and payable at that time.

ARTICLE
VIII

CONFIDENTIAL
INFORMATION

Section 8.1          Nondisclosure.

Each
of BreitBurn Management and the Partnership Group agrees that (i) it will not
disclose to any third party or use any Confidential Information disclosed to it
by the other except as expressly permitted in this Agreement, and (ii) it will
take all reasonable measures to maintain the confidentiality of all
Confidential Information of the other Party in its possession or control, which
will in no event be less than the measures it uses to maintain the
confidentiality of its own information of similar type and importance.

Section 8.2         Permitted Disclosure.

Notwithstanding
the foregoing, each Party may disclose Confidential Information (i) to the
extent required by a court of competent jurisdiction or other governmental
authority or otherwise as required by law, including without limitation
disclosure obligations imposed under the federal securities laws, provided that
such Party has given the other Party prior notice of such requirement when
legally permissible to permit the other Party to take such legal action to
prevent the disclosure as it deems reasonable, appropriate or necessary, or
(ii) to its consultants, legal counsel, Affiliates, accountants, banks and
other financing sources and their advisors.

  
 11

ARTICLE
IX

 

LIMITATION OF
LIABILITY; INDEMNIFICATION

Section 9.1          Limitation of Liability.

Except
as may be provided in Section 9.2 below, BreitBurn Management and its
controlling persons, directors, officers, employees, agents and permitted
assigns (each, a “BreitBurn Management Party”) shall not be liable to the
Partnership Group and their respective directors, officers, employees, agents
or permitted assigns (each, a “Partnership Group Party”) for any liabilities,
claims, damages, losses or expenses, including, but not limited to, any
special, indirect, incidental or consequential damages, of a Partnership Group
Party arising in connection with this Agreement and the Services provided
hereunder.

Section 9.2          Indemnification.

(a)   BreitBurn Management shall indemnify,
defend and hold harmless each of the Partnership Group Parties from and against
all liabilities, claims, damages, losses and expenses (including, but not
limited to, court costs and reasonable attorneys’ fees)(collectively referred
to as “Damages”) of any kind or nature, of third parties unrelated to any
Partnership Group Party caused by or arising in connection with the gross
negligence or willful misconduct of BreitBurn Management in connection with the
performance of the Services, except to the extent that Damages were caused
directly or indirectly by acts or omissions of any Partnership Group Party.

(b)   The Partnership hereby acknowledges
that BreitBurn Management is an “Indemnitee” as such term is defined in the
Partnership Agreement and entitled to indemnity under the provisions of
Sections 7.7 and 7.8 of the Partnership Agreement.

ARTICLE X

DISPUTE RESOLUTION

If the Parties are unable to resolve
any dispute regarding the validity or terms of this Agreement or its
termination, service or performance issues, there is a material breach of this
Agreement that has not been corrected within thirty (30) days of receipt of
notice of such breach or any other dispute between the parties related to this
Agreement,  either party hereto may refer the matter to
an arbitrator selected in accordance with the rules of JAMS in Los Angeles
County, California as the exclusive remedy for any such dispute, and in lieu of
any court action, which is hereby waived. 
The only exception shall be a claim by either Party for injunctive
relief pending arbitration.

 12
 

ARTICLE XI

GENERAL PROVISIONS

 

Section 11.1        Notices.

All notices or other communications required or
permitted under, or otherwise in connection with, this Agreement must be in
writing and must be given by depositing same in the mail, addressed to the
Person to be notified, postpaid and registered or certified with return receipt
requested or by transmitting by national overnight courier or by transmitting
by national overnight courier or by delivering such notice in person or by
facsimile to such Party.  Notice given by
mail, national overnight courier or personal delivery shall be effective upon
actual receipt.  Notice given by facsimile
shall be effective upon confirmation of receipt when transmitted by facsimile
if transmitted during the recipient’s normal business hours or at the beginning
of the recipient’s next business day after receipt if not transmitted during
the recipient’s normal business hours.  All
notices to be sent to a Party pursuant to this Agreement shall be sent to or
made at the address, in each case as follows:

if to the General Partner:

BreitBurn GP, LLC

515 South Flower  Street, Suite 4800

Los Angeles, CA 90071

Attention:  Halbert S. Washburn

Fax:  (213) 225-5917

if to the Partnership:

BreitBurn Energy Partners L.P.

515 South Flower  Street, Suite 4800

Los Angeles, CA 90071

Attention:  Halbert S. Washburn

Fax:  (213) 225-5917

if to the Operating Partnership:

BreitBurn Operating L.P.

515 South Flower  Street, Suite 4800

Los Angeles, CA 90071

Attention:  Halbert S. Washburn

Fax:  (213) 225-5917

  
 13
 

if to BreitBurn Management:

BreitBurn Management Company, LLC

515 South Flower  Street, Suite 4800

Los Angeles, CA 90071

Attention:  Randall J. Findlay

Fax:  (213) 225-5917

Section 11.2        Further Action.

The Parties shall execute and deliver all documents,
provide all information and take or refrain from taking action as may be
necessary or appropriate to achieve the purposes of this Agreement.

Section 11.3        Binding Effect.

This Agreement shall be binding upon and inure to the
benefit of the Parties hereto and their heirs, executors, administrators,
successors, legal representatives and permitted assigns.

Section 11.4        Integration.

This Agreement constitutes the entire Agreement among
the Parties hereto pertaining to the subject matter hereof and supersedes all
prior agreements and understandings pertaining thereto.

Section 11.5        Creditors.

None of the provisions of this Agreement shall be for
the benefit of, or shall be enforceable by, any creditor of the Partnership.

Section 11.6        Waiver.

No failure by any party to insist upon the strict
performance of any covenant, duty, agreement or condition of this Agreement or
to exercise any right or remedy consequent upon a breach thereof shall
constitute waiver of any such breach of any other covenant, duty, agreement or
condition.

Section 11.7        Counterparts.

This Agreement may be executed in counterparts, all of
which together shall constitute an agreement binding on all the Parties hereto,
notwithstanding that all such Parties are not signatories to the original or
the same counterpart.  Each Party shall
become bound by this Agreement immediately upon affixing its signature hereto.

Section 11.8        Applicable Law.

This Agreement shall be construed in accordance with
and governed by the laws of the State of Delaware, without regard to the
principles of conflicts of law.

  
 14
 

Section 11.9        Invalidity of Provisions.

If any provision of this Agreement is or becomes
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein shall not be
affected thereby.

Section 11.10      Amendment or Restatement.

This Agreement may be amended or restated only by a
written instrument executed by each of the Parties; provided, however, that the
Partnership may not, without the prior approval of its Conflicts Committee,
agree to any amendment or modification of this Agreement that the General
Partner determines will adversely affect the holders of common units
representing limited partner interests in the Partnership.  The Parties hereto agree that, for purposes
of this Section 8.10, any material change in the nature, quantity or duration
of the Services to be provided under this Agreement shall constitute a
modification of this Agreement.

Section 11.11      Directly or Indirectly.

Where any provision of this Agreement refers to action
to be taken by any Party, or which such Party is prohibited from taking, such
provision shall be applicable whether such action is taken directly or indirectly
by such Party, including actions taken by or on behalf of any Affiliate of such
Party.

  
 15

IN WITNESS WHEREOF, the Parties have executed this
Agreement on, and effective as of, the Effective Date.

	
  

  	
  BREITBURN GP, LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Halbert S. Washburn

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Halbert S. Washburn

  
	
   

  	
   

  	
  Title:

  	
  Co-Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  BREITBURN ENERGY PARTNERS L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  BreitBurn GP LLC, its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Halbert S. Washburn

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Halbert S. Washburn

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Co-Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  BREITBURN OPERATING L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  BreitBurn Operating GP, LLC, its General

  Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Halbert S. Washburn

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Halbert S. Washburn

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Co-Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  BREITBURN MANAGEMENT COMPANY, LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Randall J. Findlay

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Randall J. Findlay

  
	
   

  	
   

  	
  Title:

  	
  Chairman

  
							

 BREITBURN ENERGY PARTNERS L.P.
 ADMINISTRATIVE SERVICES AGREEMENT
 SIGNATURE PAGE

SCHEDULE I

 

SERVICES PROVIDED BY BREITBURN MANAGEMENT 

TO PARTNERSHIP

1.                                       Accounting

2.                                       Information
Technology

3.                                       Real Property

4.                                       Legal

5.                                       Securities and
Exchange Commission Reporting

6.                                       Operations/Reservoir
Engineering/Geology/Geophysics

7.                                       Administrative
Services

8.                                       Financial
Services

9.                                       Insurance
Service

10.                                 Risk
Management

11.                                 Corporate
Development

12.                                 Commercial
and Marketing

13.                                 Treasury

14.                                 Tax

15.                                 Audit

16.                                 SOX

17.                                 Investor
Relations

BREITBURN ENERGY
PARTNERS L.P.

ADMINISTRATIVE SERVICES AGREEMENT

 I-1

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