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Exhibit 10.11  

 
 

REDIFF.COM INDIA LIMITED
  
    2002 Stock Option Plan    
    

        1.    Purpose.    The purpose of this Plan is to promote ownership of American Depository Shares representing equity
shares of Rediff.com India Limited by key employees and directors of Rediff.com India Limited and its subsidiaries, thereby reinforcing a mutuality of interest with other shareholders, and to enable
Rediff.com India Limited and its subsidiaries to attract, retain and motivate key employees and directors by permitting them to share in its growth. 

        2.    Definitions.    As used in this Plan, 

        "Board" means the Board of Directors of the Company and, to the extent of any delegation by the Board to a committee (or subcommittee
thereof) pursuant to Section 12 of this Plan, such committee (or subcommittee). 

        "Company" means Rediff.com India Limited, a company incorporated under the laws of India and includes any successor thereto. 

        "Director" means a member of the Board of Directors of the Company. 

        "Fair Market Value" means, as of any given day, the last reported sale price of a Share on NASDAQ on the day preceding the day such
determination is being made or, if there was no last reported sale price reported on such day, on the most recently preceding day on which such a last sale price was reported; or if the Shares are not
listed or admitted to trading on NASDAQ on the day as of which the
determination is being made, the amount determined by the Board to be the fair market value of a Share on such day. 

        "Income Tax Act" means the Income Tax Act, 1961, as amended, of India. 

        "NASDAQ" means the National Association of Securities Dealers Automated Quotation System. 

        "Option" means the right to purchase Shares upon exercise of an option granted pursuant to Section 4 of this Plan. 

        "Participant" means a person who is selected by the Board to receive benefits under this Plan and who is an employee of the Company or any
of its subsidiaries, or a director of the Company or any of its subsidiaries (regardless of whether such director is a whole time director), and in each case to whom the Company may grant Options
hereunder in compliance with applicable law (including Indian regulations and guidelines) but excludes (a) any person who is a Promoter or who
belongs to the Promoter Group; (b) a director who either directly or indirectly through an immediate relative or a body corporate, holds more than 10% of the Company's outstanding equity shares
or securities convertible into equity shares; and (c) any other person to whom the issue of options hereunder would result in non-compliance with applicable law (including Indian
regulations and guidelines). 

        "Plan" means this 2002 Stock Option Plan of the Company, as amended from time to time. 

        "Promoter" has the meaning assigned to such term in the SEBI Guidelines. 

        "Promoter Group" has the meaning assigned to such term in the SEBI Guidelines. 

        "SEBI Guidelines" means the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme)
Guidelines, 1999, as amended from time to time. 

        "Shares" means the American Depositary Shares representing equity shares of the Company par value Rs.5/- per share, as adjusted in
accordance with Section 5 of this Plan. 

 

        3.    Shares Available.    

        (a)   Subject
to adjustment as provided in Section 5 of this Plan, the total number of Shares which may be issued and sold under Options granted pursuant to this Plan
(including Options granted pursuant to Section 16 of the Plan) shall not exceed such number of Shares as are equivalent to 5% of the paid-up equity capital of the Company. 

        (b)   The
number of Shares available in Section 3(a) above shall be adjusted to account for Shares relating to Options that expire, are forfeited, are terminated or are
transferred, surrendered or relinquished upon the payment of any Option Price by the transfer to the Company of Shares or upon satisfaction of any withholding amount. 

        (c)   Notwithstanding
anything in this Plan to the contrary, but subject to adjustment as provided in Section 5 of this Plan, no individual Participant shall, during
any single calendar year, be granted Options under this Plan for Shares equal to more than 1% of the issued capital of the Company unless shareholder approval is obtained in the manner set forth in
the SEBI Guidelines. 

        4.    Options.    The Board may, from time to time and upon such terms and conditions as the Board may determine,
authorize the grant of Options to Participants provided that such grant of Options would not result in non-compliance with applicable law (including Indian regulations and guidelines).
Each such grant may utilize any or all of the authorizations, and shall be subject to all of the requirements or terms contained in the following provisions: 

        (a)   Each
grant shall specify the number of Shares to which it pertains, which shall be subject to the limitations set forth in Section 3 of this Plan. Each grant
shall also specify an option price per Share which shall, unless prohibited by applicable law, be no more than 110% of the Fair Market Value and no less than 50% of the Fair Market Value on the date
of grant. The criteria to be applied by the Board in determining the actual number of Shares to be awarded by Options granted to any Participant and the option price per Share shall be based on the
grade of the Participant and may include, without limitation, the length of service, contributions, dedication and performance of the Participant and shall take into account applicable tax laws and
such other factors as the Board may deem relevant from time to time. 

        (b)   Successive
grants may be made to the same Participant whether or not any Options previously granted to such Participant remain unexercised. 

        (c)   Options
granted under this Plan may be (i) options that are intended to qualify under particular provisions of applicable tax laws of any jurisdiction,
(ii) options that are not intended to so qualify, or (iii) combinations of the foregoing. To the extent that any provision of this Plan would prevent an Option intended to qualify under
particular provisions of applicable tax laws from qualifying as such, that provision shall not apply to (and shall have no effect whatsoever in respect of) such Option or its subsequent exercise. Such
provision shall, however, remain in effect for other Options and there shall be no further effect on any provision of this Plan. 

        (d)   Each
grant shall specify the period or periods of continuous service by the Participant with the Company or any of its subsidiaries that is necessary before the Options
or installments thereof will become exercisable and may provide for earlier exercise of the Option, including, without limitation, in the event of a change in control of the Company or permanent
incapacity of the Participant while being employed or associated with the Company. Each grant shall also specify the events due to which the Options cease to become exercisable, including, without
limitation, in the event of resignation or termination of the Participant's employment or association with the Company. 

        (e)   Each
grant shall specify when the Option will become exercisable subject to the condition that no Option will be exercisable until the date following the first
anniversary of the date of grant 

2

 

of
the Option. A Participant may exercise an Option in whole or in part at any time and from time to time after such Option becomes exercisable; provided
however that no Option shall be exercisable if the exercise thereof would violate any provision of applicable law, nor shall any Option be exercisable more than 10 years
from the date of grant. 

        (f)    To
exercise an Option, a Participant must give written notice acceptable to the Company specifying the number of Shares to be purchased and make payment of the option
price and provide any other documentation that may be required by the Company. 

        (g)   The
option price shall be payable in cash or by other consideration acceptable to the Board and permitted under applicable law. 

        (h)   To
the extent not prohibited by applicable law, any grant may provide for deferred payment of the option price from the proceeds of sale through a broker, on a date
satisfactory to the Company, of some or all of the Shares to which such exercise relates. 

        (i)    Except
as otherwise determined by the Board, no Option shall be transferable or capable of being pledged, hypothecated, mortgaged or otherwise alienated or disposed of
in any manner by the Participant except by will or the laws of descent and distribution. Except as otherwise determined by the Board, Options shall be exercisable during the Participant's lifetime
only by the Participant or, in the event of the Participant's legal incapacity to do so, the Participant's guardian or legal representative acting on behalf of the Participant in a fiduciary capacity
under applicable law and court supervision. 

        5.    Adjustments.    The Board may make or provide for such adjustments in the option price and in the number or kind
of Options or Shares or other securities covered by outstanding Options as the Board in its sole discretion may in good faith determine to be equitably required in order to prevent dilution or
enlargement of the rights of Participants that would otherwise result from any (a) stock dividend, stock split, combination of shares, recapitalization or other change in the capital structure
of the Company, (b) merger, consolidation, separation, reorganization, partial or complete liquidation, issuance of rights or warrants to purchase stock or (c) other corporate
transaction or event having an effect similar to any of the foregoing. Moreover, in the event of any such transaction or event, the Board, in its discretion, may provide in substitution for any or all
outstanding Options under this Plan such alternative consideration as it, in good faith, may determine to be equitable in the circumstances and may require in connection therewith the surrender of all
options so replaced. The Board may also make or provide for such adjustments in the number of Shares specified in Section 3 of this Plan as the Board in its sole discretion, exercised in good
faith, may determine is appropriate to reflect any transaction or event described in this Section 5. 

        6.    Stock Option Agreement.    The Board may require that any Option grant be evidenced by a Stock Option Agreement.
The form of each Stock Option Agreement shall be prescribed by the Board, and any Stock Option Agreement evidencing an outstanding Option may, with the concurrence of the affected Participant, be
amended by the Board, provided that the terms and conditions of each Stock Option Agreement and amendment are not inconsistent with this Plan and that no amendment shall adversely affect the rights of
the Participant with respect to any outstanding Option without the Participant's consent. 

        7.    Cancellation of Options.    The Board may, with the concurrence of the affected Participant, cancel any Option
granted under this Plan. In the event of any such cancellation, the Board may authorize the granting of new Options (which may or may not cover the same number of Shares that were the subject of any
prior Option) in such manner, at such option price and subject to the same terms, conditions and discretion as would have been applicable under this Plan had the cancelled Options not been granted. 

3

 

        8.    Withholding.    If the Company is required to withhold any amount for tax purposes with respect to Options
issued under this Plan, the Participant shall, no later than the date as of which an amount first
becomes includible in the gross income of the Participant for applicable income tax purposes, pay to the Company or make arrangements satisfactory to the Board regarding the payment of such taxes. If
so determined by the Board and if not prohibited by applicable law, the minimum required withholding obligations may be settled with Shares, including Shares that are part of the award that gives rise
to the withholding requirement. The obligations of the Company under this Plan shall be conditional on such payment or arrangements and the Company shall, to the extent permitted by law, have the
right to deduct any such taxes from any payment of any kind otherwise due to the Participant. 

        9.    Governing Law.    The Plan and all Options granted and actions taken thereunder shall be governed by and
construed in accordance with the laws of India without giving effect to the conflicts of law rules thereof. 

        10.    Fractional Shares.    The Company shall not be required to issue any fractional Shares pursuant to this Plan.
The Board may provide for the elimination of fractions or for the settlement of fractions for cash. 

        11.    Multiple Jurisdictions.    In order to facilitate the making of any grant under this Plan, the Board may
provide for such special terms for Options to Participants who are employed by the Company or any of its subsidiaries in any particular jurisdiction other than India, or who are nationals of any
particular jurisdiction other than India, as the Board may consider necessary or appropriate to accommodate differences in local law, tax policy or custom. In addition, the Board may approve such
supplements to or restatements or alternative versions of this Plan as it may consider necessary or appropriate for such purposes, without thereby affecting the terms of this Plan as in effect for any
other purpose, and the Company Secretary or other appropriate officer of the Company may certify any such document as having been approved and adopted in the same manner as this Plan. No such special
terms, supplements or restatements, however, shall include any provisions that are inconsistent with the terms of this Plan as then in effect unless this Plan could have been amended to eliminate such
inconsistency without further approval by the shareholders of the Company. 

        12.    Administration.    The Board shall delegate responsibility and authority for the operation and administration
of this Plan, including without limitation the authority to grant Options and to determine the terms and conditions of such grant, to a committee of not less than three Directors appointed by the
Board, a majority of which shall be independent directors. To the extent of such delegation, references in this Plan to the Board shall also refer to the committee. A majority of the members of the
committee shall constitute a quorum, and any action taken by a majority of the members of the committee who are present at any meeting of the committee at which a quorum is present, or any actions of
the committee that are unanimously approved by the members of the committee in writing, shall be the acts of the committee 

        The
committee shall have the authority to adopt, alter and repeal such rules, guidelines and practices governing the Plan as it shall, from time to time, deem advisable to administer the
Plan and to interpret the provisions of the Plan and any Option granted under the Plan. The committee's policies and procedures may differ with respect to Options granted on different terms or to
different Participants. 

        13.    Amendment.    This Plan may be amended from time to time by the Board; provided,
however, that any amendment which must be approved by the shareholders of the Company in order to comply with applicable law and/or with the rules of NASDAQ, or any securities
exchange upon which the Shares are traded or quoted, shall not be effective unless and until such approval has been obtained. Nothing herein shall be construed to limit the Company's authority to
offer similar or dissimilar benefits under other plans or otherwise with or without further shareholder approval. 

4

 

        14.    Effective Date and Shareholder Approval.    This Plan shall be effective immediately upon its adoption by the
Board; provided, however, that the effectiveness of this Plan is conditioned on its approval by the shareholders of the Company at a meeting duly held
in accordance with SEBI Guidelines within 12 months after the date this Plan is adopted by the Board. All awards under this Plan shall be null and void if the Plan is not approved by the
shareholders within such 12-month period. 

        15.    Term.    No Option shall be granted pursuant to this Plan on or after the tenth anniversary of the earlier of
the date of shareholder approval or the date of adoption of this Plan by the Board, but awards granted prior to such tenth anniversary may extend beyond that. 

        16.    Awards in Substitution for Awards Granted by Other Companies.    To the extent not otherwise provided in the
Plan, Options may be granted under this Plan in substitution for awards held by employees of a company who become employees of the Company or of any of its subsidiaries as a result of the acquisition,
merger or consolidation of the employer company by or with the Company or by or with a subsidiary of the Company. The terms, provisions and benefits of the substitute awards so granted may vary from
those set forth in or authorized by this Plan to such extent as the Board at the time of the grant may deem appropriate to conform, in whole or in part, to the terms, provisions and benefits of awards
in substitution for which they are granted or to the terms and provisions of the agreements entered into by the Company or its subsidiary at the time of or in connection with the acquisition, merger
or consolidation of the employer company by or with the Company or by or with its subsidiary. 

        17.    Not a Term of Employment.    This Plan shall not be construed as conferring upon the Participant any right with
respect to employment (including, without limitation, continuation of employment) by the Company nor shall it interfere in any way with the Company's right to terminate the employment at any time,
with or without cause. The terms of employment of an employee shall not be affected by the execution of this plan. The Options granted under this Plan shall not form a part of the terms of
employment of an employee or entitle him/her to take into account the Options granted under the Plan in calculating any compensation or damages on the termination of his/her employment for any reason. 

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Exhibit 10.3  

 
 

COMMON UNIT REDEMPTION AGREEMENT    
    

        This COMMON UNIT REDEMPTION AGREEMENT (this "Agreement"), is made and entered into as of August 19, 2003, by and between PACIFIC ENERGY PARTNERS, L.P., a
Delaware limited partnership (the "Partnership"), and PACIFIC ENERGY GP, INC., a Delaware corporation (the "Holder"). 

        WHEREAS,
the Holder now holds 1,865,000 common units representing limited partner interests in the Partnership (the "Common Units"); 

        WHEREAS,
the Partnership desires to increase the public float of the Common Units; 

        WHEREAS,
the Partnership has entered into an underwriting agreement of even date herewith (the "Underwriting Agreement") with Citigroup Global Markets Inc., Lehman
Brothers Inc., UBS Securities LLC, A.G. Edwards & Sons, Inc., RBC Dain Rauscher Inc., and McDonald Investments Inc. (collectively, the "Underwriters") pursuant to
which the Partnership is publicly offering (the "Public Offering") for cash (i) 5,000,000 Common Units (the "Primary Units") and (ii) in the event the Underwriters exercise their
over-allotment option pursuant to the Underwriting Agreement, up to an additional 750,000 Common Units (the "Option Units"), in each case pursuant to the Partnership's registration
statement on Form S-3 (File No. 333-107609) (as amended to the date hereof, the "Registration Statement") and a prospectus supplement (together with the
prospectus included in the Registration Statement, the "Prospectus") filed under Rule 424 under the Securities Act (as defined herein); and 

        WHEREAS,
the Holder desires to transfer to the Partnership, and the Partnership desires to redeem from the Holder, 1,115,000 Common Units (the "Initial Units") and an additional number
of Common Units equal to the number of Option Units the Underwriters purchase from the Partnership in the
Public Offering (the "Additional Units", together with the Initial Units, the "Units") upon the terms and conditions hereinafter set forth (the "Redemption"). 

        NOW
THEREFORE, in consideration of the mutual covenants, conditions and agreements set forth herein, and for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows: 

        1.    Redemption of Units.    Subject to the terms and conditions and in reliance upon the representations and
warranties herein set forth, the Holder agrees to transfer to the Partnership, and the Partnership agrees to redeem from the Holder, at a price per unit of $23.612 (the "Redemption Price"), which is
equal to the net proceeds per unit received by the Partnership in the Public Offering, after underwriting discounts and commissions, but before expenses, the Initial Units on the Initial Closing Date
(as defined herein). 

        Upon
the Underwriters' purchase of the Option Units from the Partnership and subject to the terms and conditions and in reliance upon the representations and warranties herein set forth,
the Holder agrees to transfer to the Partnership, and the Partnership agrees to redeem from the Holder, at the Redemption Price, the Additional Units on the Additional Closing Date (as defined
herein). 

        1.1   The
closing of the redemption of the Initial Units (the "Initial Closing") shall take place at the offices of Vinson & Elkins L.L.P. in New York, New York, at
10:00 a.m., local time, or as soon as practicable thereafter, on August 25, 2003 (the "Initial Closing Date"). The closings for the redemption of Additional Units (the "Additional
Closing", together with the Initial Closing, the "Closings") shall take place at such places and such times as to coincide with the Underwriters' purchase of Option Units from the Partnership in the
Public Offering (the "Additional Closing Date", together with the Initial Closing Date, the "Closing Dates").

 

        1.2   At
each Closing, the Holder shall assign and transfer to the Partnership all its right, title and interest in and to the Units free and clear of all liens or other
limitations or restrictions and deliver to the Partnership the certificate or certificates representing the Units, duly endorsed in blank or accompanied by separate stock powers so endorsed. Holder
shall execute the certificate of transfer on the back of the certificate or certificates representing the Units. 

        1.3   The
Partnership shall pay the aggregate Redemption Price on each Closing Date, without deduction, by wire transfer of immediately available funds to an account of the
Holder (the number for which account shall have been furnished to the Partnership at least one business day prior to the Closing Date). 

        1.4   The
Holder and the Partnership agree to treat the Redemption for United States federal income tax purposes as a redemption of the Units in reimbursement of certain
capitalized expenditures. The Holder and the Partnership shall report, act and file all applicable tax returns in all respects and for all purposes consistent with such treatment and shall not take
any position that is inconsistent with such treatment (whether in audits, tax returns or otherwise). 

        2.    Representations and Warranties of Holder.    The Holder hereby represents and warrants to, and agrees with the
Partnership, as applicable, that: 

        2.1   Existence
and Power. The Holder is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Delaware and has all requisite
corporate power and authority to execute and deliver this Agreement and consummate the transactions and perform each of its obligations contemplated hereby. 

        2.2   Authority;
Approvals. 

        (a)   The
execution and delivery of this Agreement by the Holder, the consummation by the Holder of each of the transactions and the performance by the Holder of each of its
obligations contemplated hereby have been duly and properly authorized by all necessary corporate action on the part of the Holder. This Agreement has been duly executed and delivered by the Holder,
and, assuming the accuracy of the representations and warranties of the Partnership in Section 3 hereof, constitutes the valid and legally binding obligation of the Holder, enforceable against
it in accordance with its terms, subject, (i) as to enforceability, to bankruptcy, insolvency, reorganization, moratorium and other similar laws of general applicability relating to or
affecting creditors' rights and to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law) and (ii) to equitable principles of
general applicability relating to the availability of specific performance, injunctive relief, or other equitable remedies. 

        (b)   The
execution and delivery of this Agreement by the Holder and the consummation of each of the transactions and the performance of each of the obligations contemplated
hereby (i) do not conflict with or violate (whether with or without notice or a lapse of time or both), require the consent of any Person to or otherwise result in a material detriment to the
Holder under, its organizational documents or any agreement to which it is a party or by which its assets or property is bound or any law or order applicable to it, in each case in a manner that could
reasonably be expected to materially hinder or impair the completion of any of the transactions contemplated hereby or have a material adverse effect on the business, properties, condition (financial
or otherwise), liabilities or prospects of the Holder; and (ii) do not impose any penalty or other onerous condition on the Holder that could reasonably be expected to materially hinder or
impact the completion of any of the transactions contemplated hereby. As used herein, the term "Person" means a natural person, corporation, limited liability company, venture, partnership, trust,
unincorporated organization, association or other entity.

 

        (c)   No
approval from any Governmental Entity is required with respect to the Holder in connection with the execution and delivery by the Holder of this Agreement, the
performance by the Holder of its obligations hereunder or the consummation by the Holder of the transactions contemplated hereby, except for any such approval the failure of which to be made or
obtained (i) has not impaired and could not reasonably be expected to impair the ability of the Holder to perform its obligations under this Agreement in any material respect and
(ii) could not reasonably be expected to delay in any material respect or prevent the consummation of any of the transactions contemplated by this Agreement. As used herein, the term
"Governmental Entity" means any agency, bureau, commission, authority, department, official, political subdivision, tribunal or other instrumentality of any government, whether (i) regulatory,
administrative or otherwise; (ii) federal, state or local; or (iii) domestic or foreign. 

        2.3   Ownership
of Units. The Holder is the record and beneficial owner of the Units, free and clear of any lien and any other limitation or restriction with full right and
authority to deliver the same hereunder, and will transfer and deliver to the Partnership on the Closing Dates valid title to the Units, free and clear of any lien and any such other limitation or
restriction (except as the nonassessability of the Units may be affected by matters described in the Partnership's registration statement on Form S-1 (File
No. 333-84812) under the caption "The Partnership Agreement—Limited Liability," which is incorporated by reference into the Partnership's registration statement on
Form 8-A (File No. 1-31345)). 

        2.4   Independent
Investigation. The Holder (a) has the requisite knowledge, sophistication and experience in order to fairly evaluate a disposition of the Units,
including the risks associated therewith, and (b) has adequate information and has made its own independent investigation and evaluation to the extent it deems necessary or appropriate
concerning the properties, business and financial condition of the Partnership to make an informed decision regarding the transfer of the Units pursuant to this Agreement. 

        3.    Representations and Warranties of the Partnership.    The Partnership hereby represents and warrants to, and
agrees with the Holder, that: 

        3.1   Existence
and Power. The Partnership is a limited partnership duly organized, validly existing and in good standing under the laws of the State of Delaware and has all
requisite entity power and authority to execute and deliver this Agreement and consummate the transactions and perform each of its obligations contemplated hereby. 

        3.2   Authority;
Approvals. 

        (a)   The
execution and delivery of this Agreement by the Partnership, the consummation by the Partnership of each of the transactions and the performance by the Partnership
of each of its obligations contemplated hereby have been duly and properly authorized by all necessary partnership action on the part of the Partnership. This Agreement has been duly executed and
delivered by it and, assuming the accuracy of the representations and warranties of the Holder in Section 2 hereof, constitutes the valid and legally binding obligation of the Partnership,
enforceable against it in accordance with its terms, subject, (i) as to enforceability, to bankruptcy, insolvency, reorganization, moratorium and other similar laws of general applicability
relating to or affecting creditors' rights and to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law) and (ii) to
equitable principles of general applicability relating to the availability of specific performance, injunctive relief, or other equitable remedies. 

        (b)   The
execution and delivery of this Agreement by the Partnership and the consummation of each of the transactions and the performance of each of the obligations

 
contemplated hereby (i) do not conflict with or violate (whether with or without notice or a lapse of time or both), require the consent of any Person to or otherwise result in a material
detriment to the Partnership under, its organizational documents or any agreement to which it is a party or by which its assets or property is bound or any law or order applicable to it, in each case
in a manner that could reasonably be expected to materially hinder or impair the completion of any of the transactions contemplated hereby or have a material adverse effect on the business,
properties, condition (financial or otherwise), liabilities or prospects of the Partnership; and (ii) do not impose any penalty or other onerous condition on the Partnership that could
reasonably be expected to materially hinder or impact the completion of any of the transactions contemplated hereby. 

        (c)   No
approval from any Governmental Entity is required with respect to the Partnership in connection with the execution and delivery by the Partnership of this Agreement,
the performance by the Partnership of its obligations hereunder or the consummation by the Partnership of the transactions contemplated hereby, except (i) as have been obtained under the
Securities Act of 1933, as amended, and the rules and regulations of the Securities and Exchange Commission (the "Commission")
thereunder (collectively, the "Securities Act"), and as may be required under state securities or blue sky laws in connection with the Public Offering and (ii) for any such approval the failure
of which to be made or obtained (x) has not impaired and could not reasonably be expected to impair the ability of the Partnership to perform its obligations under this Agreement in any
material respect and (y) could not reasonably be expected to delay in any material respect or prevent the consummation of any of the transactions contemplated by this Agreement. 

        4.    Conditions to Closing.    

        4.1   Conditions
to Obligations of the Partnership. The obligation of the Partnership to redeem the Units on a Closing Date hereunder is subject to the satisfaction of the
following conditions: 

        (a)   The
closing contemplated in Section 3 of the Underwriting Agreement shall have occurred (including, in the case of the Additional Units, a closing with respect to
the Option Units); 

        (b)   The
Holder shall have performed in all material respects all of its obligations hereunder required to be performed by it on or prior to the Closing Date; 

        (c)   No
action, claim, suit, hearing, complaint, demand, injunction, litigation, judgment, arbitration, order, decree, ruling or governmental investigation or proceeding is
then pending or threatened by any court or Governmental Entity, and no such court or Governmental Entity shall have issued any injunction, judgment or order, which shall remain in effect, that would
prevent consummation of the Redemption; provided, however, that the parties hereto shall use their reasonable best efforts to have any such injunction, judgment or order vacated or reversed; 

        (d)   The
representations and warranties of the Holder contained in this Agreement and in any certificate or other writing delivered by the Holder pursuant hereto shall be
true in all material respects at and as of the Closing Date, as if made at and as of such date; and 

        (e)   The
Partnership shall have received a certificate signed by a duly authorized officer of the Holder to the effects set forth in clauses (b) and (d) above.

 

        4.2   Conditions
of Obligations of the Holder. The obligation of the Holder to consummate the transactions contemplated on a Closing Date hereby is subject to the satisfaction
of the following conditions: 

        (a)   The
closing contemplated in Section 3 of the Underwriting Agreement shall have occurred (including, in the case of the Additional Units, a closing with respect to
the Option Units); 

        (b)   The
Partnership shall have performed in all material respects all of its obligations under this Agreement required to be performed by it on or prior to the Closing Date; 

        (c)   No
action, claim, suit, hearing, complaint, demand, injunction, litigation, judgment, arbitration, order, decree, ruling or governmental investigation or proceeding is
then pending or threatened by any court or Governmental Entity, and no such court or Governmental Entity shall have issued any injunction, judgment or order, which shall remain in effect, that would
prevent consummation of the Redemption; provided, however, that the parties hereto shall use their reasonable best efforts to have any such injunction, judgment or order vacated or reversed; 

        (d)   The
representations and warranties of the Partnership contained in this Agreement and in any certificate or other writing delivered by the Partnership pursuant hereto
shall be true in all material respects at and as of the Closing Date, as if made at and as of such date; and 

        (e)   The
Holder shall have received a certificate signed by a duly authorized officer of Pacific Energy GP, Inc. on behalf of the Partnership to the effects set forth
in clauses (b) and (d) above. 

        5.    Governmental Filings.    The Holder shall, or cause its affiliates, as applicable, to make all filings with any
Governmental Entity required by the Holder in connection with the execution and delivery by the Holder of this Agreement or the consummation by the Holder of the transactions contemplated hereby,
including without limitation, all filings with the Commission required pursuant to the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission thereunder. 

        6.    Expenses.    Whether or not the transactions contemplated by this Agreement are consummated, each of the
Partnership and the Holder shall pay its own expenses incurred in connection with the negotiation and preparation of this Agreement and the consummation of the transactions contemplated hereby. 

        7.    Miscellaneous.    

        7.1   Notices.
All notices, requests and other communications to any party hereunder shall be in writing (including facsimile transmission) and shall be given, 

If
to the Holder, to: 

Pacific
Energy GP, Inc.

555 17th Street, Ste. 2400

Denver, Colorado 80202

Attention: Clifford P. Hickey

Fax: (303) 299-1333 

 

If
to the Partnership, to: 

Pacific
Energy Partners, L.P.

5900 Cherry Avenue

Long Beach, California

Attention: Irvin Toole, Jr.

Fax: (562) 728-2810 

        All
such notices, requests and other communications shall be deemed received on the date of receipt by the recipient thereof if received prior to 5:00 p.m. in the place of receipt
and such day is a business day in the place of receipt. Otherwise, any such notice, request or communication shall be deemed not to have been received until the next succeeding business day in the
place of receipt. By notice given in accordance with this Section 7.1 to the other party, any party may change its address for the receipt of notices under this Agreement. 

        7.2   Amendments
and Waivers. Any provision of this Agreement may be amended or waived if, but only if, such amendment or waiver is in writing and is signed, in the case of an
amendment, by each party to this Agreement, or in the case of a waiver, by the party against whom the waiver is to be effective. No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or
privilege. 

        7.3   Successors
and Assigns. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and
assigns. After the date of this Agreement and before any Closing Date, Holder intends to assign its rights and obligations under this Agreement, and its ownership of the Common Units, to a Person
that, directly or indirectly, controls the Holder. The Partnership hereby acknowledges such intention, waives any objection it may have to such assignment and agrees to treat any such assignee as the
"Holder" for all purposes under this Agreement. 

        7.4   Governing
Law. This Agreement shall be governed by and construed in accordance with the law of the State of Delaware, without reference to its conflict of laws
principles. 

        7.5   Public
Announcements. Each party agrees that, except as may be required by applicable law or any listing agreement with any national securities exchange, such party will
not issue any press release or make any public statement with respect to this Agreement or the transactions contemplated hereby without obtaining the prior written consent of the other party.
Notwithstanding anything herein to the contrary, the Holder and the Partnership (and each employee, representative or other agent of the Holder or the Partnership) may disclose to any and all persons,
without limitation of any kind, the U.S. federal income tax treatment and tax structure of the transaction contemplated herein (the "Transaction") and all materials of any kind (including opinions and
other tax analyses) that are provided to the Holder or the Partnership relating to such tax treatment and tax structure. For this purpose, "tax structure" is limited to facts relevant to the U.S.
federal income tax treatment of the Transaction and does not include information relating to the identity of the Holder or the Partnership, or their respective affiliates, agents or advisors. 

        7.6   Section Headings.
The captions and headings appearing at the beginning of the various sections of this Agreement are for convenience of reference only and
shall not be given any effect whatsoever in the construction or interpretation of this Agreement. 

        7.7   Counterparts.
This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and
the same instrument. Any party may execute this Agreement by the delivery of a facsimile signature, which signature shall have the same force and effect as an original signature. Any party that
delivers a facsimile signature shall promptly thereafter deliver an originally executed signature to the other party; provided, however, that the failure to deliver an original signature
page shall not affect the validity of any signature delivered by facsimile. 

[The remainder of this page is intentionally blank.]

 

        IN
WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be executed by its duly authorized officer as of the date first written above. 

	

 	
 	
PACIFIC ENERGY PARTNERS, L.P.
	
 	
 	

By:	
 	

Pacific Energy GP, Inc., its General Partner
	

 	
 	

By:	
 	

/s/  IRVIN TOOLE, JR.      
 Irvin Toole, Jr.

President and Chief Executive Officer
	

 	
 	
PACIFIC ENERGY GP, INC.
	
 	
 	

By:	
 	

/s/  IRVIN TOOLE, JR.      
 Irvin Toole, Jr.

President and Chief Executive Officer

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COMMON UNIT REDEMPTION AGREEMENT

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