Document:

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                                                                     EXHIBIT 4.2

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                            NABORS INDUSTRIES, INC.,

                                   as Issuer,

                                       and

                             NABORS INDUSTRIES LTD.,

                                  as Guarantor,

                               ZERO COUPON SENIOR

                           EXCHANGEABLE NOTES DUE 2023

                          FIRST SUPPLEMENTAL INDENTURE

                          DATED AS OF OCTOBER 25, 2004

                 J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION
                        (as successor to Bank One, N.A.),

                                   as Trustee

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<PAGE>
            This FIRST SUPPLEMENTAL INDENTURE (this "First Supplemental
Indenture"), dated as of October 25, 2004, is among Nabors Industries, Inc., a
Delaware corporation, as issuer (the "COMPANY"), Nabors Industries, Ltd., a
Bermuda exempted company, as guarantor (the "GUARANTOR"), and J.P. Morgan Trust
Company, National Association (as successor to Bank One, N.A.), a national
banking association, as trustee (the "TRUSTEE").

                             RECITALS OF THE COMPANY

            WHEREAS, the Company and the Trustee entered into an Indenture,
dated as of June 10, 2003, as amended and supplemented by this First
Supplemental Indenture (as so amended and supplemented, the "Indenture"),
pursuant to which the Company issued $700,000,000 in aggregate principal amount
at maturity of Zero Coupon Senior Exchangeable Notes due 2023 (each a
"Security", collectively the "Securities");

            WHEREAS, the Company and the Guarantor desire to execute this First
Supplemental Indenture to add additional covenants by the Company for the
benefit of the Holders and to amend Sections 3.07 and 3.10 of the Indenture in
certain respects;

            WHEREAS, Section 9.01(4) of the Indenture provides that the Company
and the Guarantor may enter into one or more supplemental indentures without the
written consent of any Holders to make any change that does not adversely affect
the right of any Holder;

            WHEREAS, the Board of Directors of each of the Company and of the
Guarantor (or a duly authorized committee thereof) has duly adopted resolutions
authorizing the Company and the Guarantor, respectively, to execute and deliver
this First Supplemental Indenture; and

            WHEREAS, all the conditions and requirements necessary to make this
First Supplemental Indenture, when duly executed and delivered, a valid and
binding agreement in accordance with its terms for the purposes herein
expressed, have been performed and fulfilled.

            NOW, THEREFORE, THIS FIRST  SUPPLEMENTAL INDENTURE WITNESSETH:

            For and in consideration of the premises provided for herein by the
Holders thereof, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders of the Securities, as follows:

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                                    ARTICLE 1

                              RELATION TO INDENTURE

      SECTION 1.1 RELATION TO INDENTURE.

            This First Supplemental Indenture constitutes an integral part of
the Indenture.

      SECTION 1.2 DEFINITIONS.

            For all purposes of this First Supplemental Indenture, except as
expressly provided for or unless the context otherwise requires:

            (1) Capitalized terms used but not defined in this First
Supplemental Indenture shall have the respective meanings assigned to them in
the Indenture; and

            (2) All references in this First Supplemental Indenture to Articles
and Sections, unless otherwise specified, refer to the corresponding Articles
and Sections of this First Supplemental Indenture.

                                    ARTICLE 2

                           REDEMPTION AND REPURCHASES

      SECTION 2.1 EXCHANGE ARRANGEMENT ON CALL FOR REDEMPTION.

            Section 3.07 of the Indenture is hereby amended by deleting it in
its entirety and substituting in place thereof the following:

                  Section 3.07 [INTENTIONALLY OMITTED].

      SECTION 2.2 EFFECT OF REPURCHASE NOTICE OR FUNDAMENTAL CHANGE
REPURCHASE NOTICE.

            The last paragraph of Section 3.10 of the Indenture is hereby
amended by deleting it in its entirety and substituting in place thereof the
following:

            There shall be no repurchase of any Securities pursuant to Section
      3.08 hereof or repurchase pursuant to Section 3.09 hereof if there has
      occurred (prior to, on or after, as the

                                       2
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      case may be, the giving, by the Holders of such Securities, of the
      required Repurchase Notice or Option to Elect Repurchase Upon a
      Fundamental Change, as the case may be) and is continuing an Event of
      Default (other than a default in the payment of the Purchase Price or
      Fundamental Change Purchase Price, as the case may be, with respect to
      such Securities).

                                    ARTICLE 3

                              ADDITIONAL COVENANTS

      SECTION 3.1 PAYMENT OF PURCHASE PRICE IN CASH.

            The following new Section 4.12 is hereby added to the Indenture:

            SECTION 4.12. PAYMENT OF PURCHASE PRICE IN CASH.

            The Company and the Guarantor covenant and agree for the benefit of
      each Holder that in any Company Notice issued pursuant to Section 3.08 of
      the Indenture, the Company shall in all circumstances elect to pay the
      Purchase Price solely in cash.

      SECTION 3.2 EXCHANGE PAYMENTS IN CASH.

            The following new Section 4.13 is hereby added to the Indenture:

            SECTION 4.13. EXCHANGE PAYMENTS IN CASH.

            (a) The Company and the Guarantor covenant and agree for the benefit
      of each Holder that any written notice issued by the Company pursuant to
      Section 11.02 of the Indenture shall in all circumstances specify that the
      Company shall make payment solely in cash for all Securities submitted for
      exchange unless the Full Cash Price (as defined below) for a Security is
      greater than the Principal Amount thereof, in which case the Company shall
      (x) pay in cash the percentage of the Full Cash Price equal to the
      quotient obtained by dividing the Principal Amount of such Security by the
      Full Cash Price for such Security, and (y) pay the remaining portion of
      the payment for such Securities either, at the option of the Company, (i)
      by delivery of a number of Common Shares equal to the quotient obtained by
      dividing (A) the excess of the Full Cash Price for such Security over the
      Principal Amount of such Security by (B) the average of the Sales Prices
      of the Common Shares for the five Trading Days immediately following the
      date on which the Company notifies the Holders that it has elected to pay
      cash in lieu of delivering Common Shares (and cash in lieu of fractional
      Common Shares) or (ii) in cash. The "FULL CASH PRICE" shall be equal to
      the average of the Sale Prices of the Common Shares for the five Trading
      Days beginning on the Trading Day immediately following the date on which
      the Company notifies the Holders that it has elected to pay cash in lieu
      of delivering Common Shares with

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      respect to all or part of such exchanges, multiplied by the Exchange Rate
      on such notification date.

            (b) The calculation set forth in Section 4.13(a) shall be made by
      the Company and the Guarantor. The Trustee shall have no duty to make the
      calculation set forth in Section 4.13(a) and takes no responsibility for
      any calculation made by the Company or the Guarantor pursuant to Section
      4.13(a). Each Exchange Agent (other than the Company or one of its
      Affiliates) shall have the same protection under this Section 4.13(b) as
      the Trustee.

                                    ARTICLE 4

                            MISCELLANEOUS PROVISIONS

      SECTION 4.1 RATIFICATION OF INDENTURE.

            Except as expressly modified or amended hereby, the Indenture
continues in full force and effect and is in all respects confirmed and
preserved.

      SECTION 4.2 EFFECTIVENESS.

            This First Supplemental Indenture shall be effective as of the date
first written above.

      SECTION 4.3 CONFLICT WITH THE TRUST INDENTURE ACT.

            If any provision of this First Supplemental Indenture modifies or
excludes any provision of the Trust Indenture Act that is required under such
Act to be part of and govern this First Supplemental Indenture, the latter
provision of the Trust Indenture Act shall control. If any provision hereof
modifies or excludes any provision of the Trust Indenture Act that may be so
modified or excluded, the latter provision of the Trust Indenture Act shall be
deemed to apply to this First Supplemental Indenture, as so modified or
excluded, as the case may be.

      SECTION 4.4 SECURITIES DEEMED CONFORMED.

            As of the date hereof, the provisions of each Security then
outstanding shall be deemed to be conformed, without the necessity for any
reissuance or exchange of such Security or any other action on the part of the
Holders, the Company, the Guarantor or the Trustee, so as to reflect this First
Supplemental Indenture.

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      SECTION 4.5 NO ADDITIONAL TRUSTEE OBLIGATIONS.

            No duties, responsibilities or liabilities are assumed, or shall be
construed to be assumed, by the Trustee by reason of this First Supplemental
Indenture. This First Supplemental Indenture is executed and accepted by the
Trustee subject to all the terms and conditions set forth in the Indenture with
the same force and effect as if those terms and conditions were repeated at
length herein and made applicable to the Trustee with respect hereto.

      SECTION 4.6 SUCCESSORS.

            All agreements of the Company, the Guarantor and the Trustee in this
First Supplemental Indenture and in the Indenture shall bind their respective
successors.

      SECTION 4.7 BENEFITS OF FIRST SUPPLEMENTAL INDENTURE.

            Nothing in this First Supplemental Indenture, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and the Holders, any benefit or any legal or equitable right, remedy
or claim under this First Supplemental Indenture.

      SECTION 4.8 GOVERNING LAW.

            THE LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE AND ENFORCE THIS FIRST SUPPLEMENTAL INDENTURE.

      SECTION 4.9 COUNTERPARTS.

            This First Supplemental Indenture may be executed in any number of
counterparts, each of which shall be an original, but all such counterparts
shall together constitute but one and the same instrument.

      SECTION 4.10 TRUSTEE.

            The Trustee is not responsible in any manner whatsoever for or in
respect of the validity or sufficiency of this First Supplemental Indenture or
for or in respect of the recitals contained herein, which are made solely by the
Company and the Guarantor.

                       [SIGNATURE PAGE FOLLOWS]

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            IN WITNESS WHEREOF, the parties hereto have cause this First
Supplemental Indenture to be duly executed as of the first day and year first
written above.

                                    ISSUER:

                                    NABORS INDUSTRIES, INC.

                                    By: /s/ BRUCE P. KOCH
                                        ------------------------------
                                        Bruce P. Koch
                                        Vice President-Finance and
                                          Chief Financial Officer

                                    GUARANTOR:

                                    NABORS INDUSTRIES LTD.

                                    By: /s/ DANIEL MCLACHLIN
                                        ------------------------------
                                        Daniel McLachlin
                                        Vice President - Administration

                                    TRUSTEE:

                                    J.P. MORGAN TRUST COMPANY,
                                    NATIONAL ASSOCIATION (as successor
                                    to Bank One, N.A.), as Trustee

                                    By: /s/ MARY JANE HENSON
                                        ------------------------------
                                        Name:  Mary Jane Henson
                                        Title: Vice Presidentexv10w1

 

EXHIBIT 10.1

SECOND AMENDED AND RESTATED

ADMINISTRATIVE SERVICES AGREEMENT

(formerly called, EPCO AGREEMENT)

by and among

EPCO, INC.

(formerly known as Enterprise Products Company)

ENTERPRISE PRODUCTS PARTNERS L.P.

ENTERPRISE PRODUCTS OPERATING L.P.

ENTERPRISE PRODUCTS GP, LLC

and

ENTERPRISE PRODUCTS OLPGP, INC.

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	

	 	ARTICLE 1: DEFINITIONS	 	 	 	 
	1.1

	 	Definitions
	 	 	2	 
	1.2

	 	Construction
	 	 	2	 
	

	 	ARTICLE 2: SERVICES	 	 	 	 
	2.1

	 	EPCO Services; Term
	 	 	2	 
	2.2

	 	EPCO Compensation
	 	 	2	 
	2.3

	 	Dispute Regarding Services or Calculation of Costs.
	 	 	3	 
	2.4

	 	Invoices
	 	 	3	 
	2.5

	 	Disputes; Default
	 	 	4	 
	2.6

	 	Input Regarding EPCO Services
	 	 	4	 
	2.7

	 	Limitation Regarding EPCO Services
	 	 	4	 
	2.8

	 	Representations Regarding Use of Services
	 	 	4	 
	2.9

	 	Warranties; Limitation of Liability
	 	 	4	 
	2.10

	 	Force Majeure
	 	 	5	 
	2.11

	 	Affiliates
	 	 	5	 
	

	 	ARTICLE 3: USE OF NAME AND MARK	 	 	 	 
	3.1

	 	Grant of License
	 	 	5	 
	3.2

	 	Reimbursement of Costs
	 	 	5	 
	

	 	ARTICLE 4: EPCO’S INDEMNIFICATION FOR EXCLUDED LIABILITIES	 	 	 	 
	4.1

	 	Indemnification
	 	 	5	 
	4.2

	 	Indemnification Procedures
	 	 	6	 
	

	 	ARTICLE 5: OTHER AGREEMENTS	 	 	 	 
	5.1

	 	Insurance Matters
	 	 	6	 
	5.2

	 	Sublease of Equipment
	 	 	6	 
	5.3

	 	EPCO’s Employees
	 	 	6	 
	5.4

	 	Business Opportunities
	 	 	7	 
	

	 	ARTICLE 6: MISCELLANEOUS	 	 	 	 
	6.1

	 	Choice of Law; Submission to Jurisdiction
	 	 	7	 
	6.2

	 	Notices
	 	 	7	 
	6.3

	 	Entire Agreement; Supersedure
	 	 	8	 
	6.4

	 	Effect of Waiver of Consent
	 	 	8	 
	6.5

	 	Amendment or Modification
	 	 	8	 
	6.6

	 	Assignment
	 	 	8	 
	6.7

	 	Counterparts
	 	 	8	 
	6.8

	 	Severability
	 	 	8	 

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	6.9

	 	Further Assurances
	 	 	8	 
	6.10

	 	Withholding or Granting of Consent
	 	 	8	 
	6.11

	 	U.S. Currency
	 	 	9	 
	6.12

	 	Laws and Regulations
	 	 	9	 
	6.13

	 	Negation of Rights of Third Parties
	 	 	9	 

Attachment I Defined Terms

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SECOND AMENDED AND RESTATED

ADMINISTRATIVE SERVICES AGREEMENT

     THIS SECOND AMENDED AND RESTATED ADMINISTRATIVE SERVICES AGREEMENT (this
“Agreement”) is entered into on October 22, 2004, but effective as of October
1, 2004 (the “Effective Date”) by and among EPCO, Inc., a Texas corporation,
formerly known as Enterprise Products Company, (“EPCO”), Enterprise Products
Partners L.P., a Delaware limited partnership (“MLP”), Enterprise Products
Operating L.P., a Delaware limited partnership (“OLP”), Enterprise Products GP,
LLC, a Delaware limited liability company (“Enterprise GP”), and Enterprise
Products OLPGP, Inc., a Delaware corporation (“Enterprise OLPGP”).

R E C I T A L S

     The purpose of this Agreement is to amend and restate, in its entirety,
that certain First Amended and Restated Administrative Services Agreement (the
“First Amendment”), dated as of January 1, 2004, among the Parties hereto.

     The Parties hereto (other than Enterprise OLPGP) originally entered into
that certain EPCO Agreement, dated as of July 31, 1998, in connection with the
initial public offering of units in MLP, pursuant to which EPCO and its
Affiliates (other than the Partnership Entities) (collectively, the “EPCO
Group”) agreed to provide certain operational and financial support to the
Partnership Entities.

     Effective as of December 10, 2003, Enterprise OLPGP succeeded Enterprise
GP as the general partner of OLP.

     Effective as of January 1, 2004, the Parties hereto amended and restated
the EPCO Agreement pursuant to the First Amendment, (i) to reduce the
operational and financial support provided by the EPCO Group to the Partnership
Entities, (ii) to change the manner in which the Partnership Entities were
charged for certain administrative, management, and operating services provided
by EPCO, from a fixed fee to allocating the cost of such services to the
Partnership Entities on a pro rata basis, (iii) to assign certain contract
rights, initially retained by EPCO, but which related to assets owned by the
Partnership Entities to the Partnership Entities, and (iv) to reflect certain
other understandings between the EPCO Group and the Partnership Entities.

     Effective as of June 21, 2004, EPCO assigned the Name and the Mark to
Enterprise GP, and effective as of October 1, 2004, Enterprise GP assigned the
Name and Mark to OLP.

     The Parties hereto desire, by their execution of this Agreement, to
evidence the terms and conditions upon which (i) the EPCO Group will provide
certain services to the Partnership Entities, (ii) OLP will license the use of
the Name and the Mark to EPCO, (iii) EPCO will provide indemnification to the
Partnership Entities for certain matters, and (iv) the relationship between the
EPCO Group and the Partnership Entities regarding a variety of additional
matters will be reflected.

 

 

A G R E E M E N T S

     NOW, THEREFORE, in consideration of the premises and the covenants,
conditions, and agreements contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the Parties hereto hereby agree as follows:

ARTICLE 1: DEFINITIONS

     1.1 Definitions. The definitions listed on Attachment I shall be for all
purposes, unless otherwise clearly indicated to the contrary, applied to the
terms used in this Agreement. Any other capitalized term that is used but not
defined herein shall have the meaning given such term in the MLP Agreement.

     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; and (c) “include” or “includes” means
includes, without limitation, and “including” means including, without
limitation.

ARTICLE 2: SERVICES

     2.1 EPCO Services; Term. During the period beginning on the Effective Date and
ending on July 31, 2008, subject to the terms of this Article 2 and in exchange
for the reimbursement described in Section 2.2, EPCO hereby agrees to provide
the Partnership Entities with such selling, general and administrative services
and such management and operating services as may be necessary to manage and
operate the business, properties and assets of the Partnership Entities in
substantially the same manner that such business, properties and assets have
been managed and operated by EPCO prior to the Effective Date; it being
understood and agreed by the Parties that in connection with the provision of
such management and operating services, EPCO shall employ or otherwise retain
the services of such personnel as may be necessary to cause the business,
properties and assets of the Partnership Entities to be so managed and operated
(individually, an “EPCO Service” and, collectively, the “EPCO Services”). All
EPCO Services provided by EPCO hereunder shall be substantially identical in
nature and quality to the services of such type provided by EPCO with respect
to the business, properties and assets of the Partnership Entities during the
calendar year 2003.

     2.2 EPCO Compensation. As compensation for the provision by EPCO to the
Partnership Entities of the EPCO Services, EPCO shall be entitled to receive,
and the Partnership Entities agree to pay to EPCO, an amount equal to the sum
of all costs and expenses (direct or indirect) incurred by EPCO which are
directly or indirectly related to the business or activities of the Partnership
Entities (including, without limitation, expenses, direct or indirect, reasonably allocated to the
Partnership Entities by EPCO). In addition, the Partnership Entities shall pay
all sales, use, excise, value added or similar taxes, if any, that may be
applicable from time to time in respect of the EPCO Services provided to the
Partnership Entities by EPCO. The aggregate amount payable by the Partnership
Entities to EPCO pursuant to this Section 2.2 with respect to a given period of
time shall be referred to herein as the “Administrative Services Fee”. It is
the

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intention of the Parties that, with the exception of Article V and the
Retained Leases (as hereinafter defined), the Administrative Services Fee
represents fair and reasonable compensation to EPCO for the Partnership
Entities’ allocable share of all general and administrative expenses, capital
expenses and other costs for shared services borne or performed by EPCO, or any
of the other members of the EPCO Group, for the benefit of any member of the
MLP Group. The “Retained Leases” are operating leases relating to (i) an
isomerization unit, (ii) one deisobutanizer tower, (iii) one cogeneration unit,
and (iv) 100 railcars, the liabilities for each of which were retained by EPCO
in connection with the formation of MLP and OLP.

     2.3 Dispute Regarding Services or Calculation of Costs.

          (a) Should there be a dispute over the nature or quality of the EPCO
Services, or the calculation and allocation of any Administrative Services
Fee, relating to any of the EPCO Services, the Parties shall first attempt to
resolve such dispute, acting diligently and in good faith, using the past
practices of the Parties and documentary evidence of costs as guidelines for
such resolution. If the Parties are unable to resolve any such dispute
within thirty days, or such additional time as may be reasonable under the
circumstances, the dispute shall be referred to the Audit and Conflicts
Committee. The Parties agree that the Audit and Conflicts Committee shall
have the authority to settle any such dispute, in its sole discretion,
recognizing that it is the intent of all Parties that all shared expenses or
services be allocated between the EPCO Group and the Partnership Entities on
a fair and reasonable basis.

          (b) EPCO and the Partnership Entities agree that the prior practice of
EPCO with respect to the EPCO Services previously provided with respect to
the business, properties and assets of the Partnership Entities or the
calculation of the Administrative Services Fee relating to such EPCO
Services, as determined from the books and records of EPCO, shall be prima
facie evidence as to the nature and quality of the EPCO Services and the
reasonableness of the calculation or allocation of the Administrative
Services Fee relating to such EPCO Services, as the case may be.

     Notwithstanding the foregoing, the Parties recognize that prior to January
1, 2004, the Administrative Services Fee for a portion of the EPCO Services was
a fixed fee, as previously described in the EPCO Agreement, and that the
Administrative Services Fee for another portion of the EPCO Services was not
calculated on a pro rata basis; therefore, the initial calculation and
allocation of the Administrative Services Fee for the calendar year 2004 for
the EPCO Services shall be reviewed and approved by the Audit and Conflicts
Committee. If the Audit and Conflicts Committee determines that the
Administrative Services Fee for 2004 should be greater than or less than the
amount actually charged by EPCO to the Partnership Entities because the
allocation of expenses between EPCO and the Partnership Entities was not
reasonable, the Partnership Entities shall pay any shortfall to EPCO, or EPCO
shall pay any overcharge to Enterprise GP, as the case may be, within thirty
days following receipt of the Audit and Conflicts
Committee’s determination. The calculations and allocations made by the
Audit and Conflicts Committee for 2004 shall establish the basis for the
calculation and allocation of the Administrative Services Fee for calendar
years 2005 through 2008.

     2.4 Invoices. EPCO shall invoice OLP on or before the last day of each month
for the estimated Administrative Services Fee for the next succeeding month,
plus or minus any

-3-

 

adjustment necessary to correct prior estimated billings to
actual billings. All invoices shall be due and payable on the last day of the
month of the invoice. Upon request, EPCO shall furnish in reasonable detail a
description of the EPCO Services performed for the Partnership Entities during
any month.

     2.5 Disputes; Default. Notwithstanding any provision of this Article 2 to the
contrary, should OLP fail to pay EPCO, when due, any amounts owing in respect
of the EPCO Services, except as set forth in the third succeeding sentence,
upon 30 days’ notice, OLP may terminate this Article 2 as to those EPCO
Services that relate to the unpaid portion of the invoice. Should there be a
dispute as to the propriety of invoiced amounts, OLP shall pay all undisputed
amounts on each invoice, but shall be entitled to withhold payment of any
amount in dispute and shall promptly notify EPCO of such disputed amount. EPCO
shall provide OLP with records relating to the disputed amount so as to enable
the Parties to resolve the dispute. So long as the Parties are attempting in
good faith to resolve the dispute, EPCO shall not be entitled to terminate the
EPCO Services that relate to the disputed amount.

     2.6 Input Regarding EPCO Services. Any records, information or other input
from the Partnership Entities that is necessary for EPCO to perform any EPCO
Services shall be submitted, upon EPCO’s request therefor, to EPCO by the
Partnership Entities in a manner consistent with the practices utilized by the
Partnership Entities during the one year period prior to January 1, 2004, which
manner shall not be altered except by mutual agreement of the Parties. If the
Partnership Entities’ failure to supply such records, information or other
input renders EPCO’s performance of any EPCO Services unreasonably difficult,
EPCO, upon reasonable notice to the Partnership Entities, may refuse to perform
such EPCO Services until such records, information or other input is supplied.

     2.7 Limitation Regarding EPCO Services. The Partnership Entities acknowledge
that the EPCO Services shall be provided only with respect to the business of
the Partnership Entities as operated on January 1, 2004 or as otherwise
mutually agreed by EPCO and the Partnership Entities which agreement regarding
additional, or fewer EPCO Services shall reflect an appropriate adjustment to
the aggregate Administrative Services Fee for the following months. EPCO shall
not be required to perform any EPCO Services for the benefit of any Person
other than the Partnership Entities.

     2.8
Representations Regarding Use of Services. 
OLP, on behalf of itself and the other members of the Partnership Entities,
represents and agrees that it will use the EPCO Services only in accordance
with all applicable federal, state and local laws and regulations, and in
accordance with the reasonable conditions, rules, regulations, and
specifications that may be set forth in any manuals, materials, documents, or
instructions furnished from time to time by EPCO to the Partnership Entities.
EPCO reserves the right to take all actions, including, without limitation,
termination of any portion of the EPCO Services that it reasonably believes is
required to be terminated in order to assure compliance with applicable laws
and regulations.

     2.9 Warranties; Limitation of Liability. The EPCO Services shall be of the
same or similar quality as those provided by EPCO with respect to the business,
properties and assets of the Partnership Entities during the one-year period
prior to January 1, 2004. EXCEPT AS SET FORTH IN THE PRECEDING SENTENCE, EPCO
MAKES NO (AND HEREBY

-4-

 

DISCLAIMS AND NEGATES ANY AND ALL) WARRANTIES OR
REPRESENTATIONS WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO THE EPCO
SERVICES. IN NO EVENT SHALL EPCO OR ANY OF ITS AFFILIATES BE LIABLE TO ANY OF
THE PARTIES RECEIVING ANY EPCO SERVICES OR TO ANY OTHER PERSON FOR ANY
EXEMPLARY, PUNITIVE, INDIRECT, INCIDENTAL, CONSEQUENTIAL, OR SPECIAL DAMAGES
RESULTING FROM ANY ERROR IN THE PERFORMANCE OF SUCH SERVICE, REGARDLESS OF
WHETHER SUCH PARTY PROVIDING SUCH SERVICE, ITS AFFILIATES, OR OTHERS MAY BE
WHOLLY, CONCURRENTLY, PARTIALLY, OR SOLELY NEGLIGENT OR OTHERWISE AT FAULT,
EXCEPT TO THE EXTENT SUCH EXEMPLARY, PUNITIVE, INDIRECT, INCIDENTAL,
CONSEQUENTIAL OR SPECIAL DAMAGES ARE PAID BY THE PARTY INCURRING SUCH DAMAGES
TO A THIRD PARTY.

     2.10 Force Majeure. EPCO shall have no obligation to perform the EPCO Services
if its failure to do so is caused by or results from any act of God,
governmental action, natural disaster, strike, failure of essential equipment,
or any other cause or circumstance, whether similar or dissimilar to the
foregoing causes or circumstances, beyond the reasonable control of EPCO.

     2.11 Affiliates. At its election, EPCO may cause one or more of its Affiliates
or third party contractors reasonably acceptable to the Party receiving such
EPCO Service to provide such EPCO Service; however, EPCO shall remain
responsible for the provision of such EPCO Service in accordance with this
Agreement.

ARTICLE 3: USE OF NAME AND MARK

     3.1 Grant of License. Effective as of October 1, 2004, OLP has granted EPCO a
worldwide royalty-free, five year right and license to use the Name and Mark
pursuant to a License Agreement.

     3.2 Reimbursement of Costs. OLP shall reimburse EPCO for the cost of removing
the Name and Mark from EPCO’s trucks in order to meet the schedule for removal
of all Names and Marks on or before the end of the term of the License
Agreement.

ARTICLE 4: EPCO’S INDEMNIFICATION FOR EXCLUDED LIABILITIES

     4.1 Indemnification. From and after the date hereof and subject to the
remaining provisions of this Article 4, EPCO shall indemnify, defend and hold
harmless the Partnership Entities from and against any loss, cost, claim,
liability, prepayment or similar penalty, damage, expense, attorneys fees,
judgment, award or settlement of any kind or nature whatsoever (other than
out-of-pocket costs and expenses incurred by the Partnership Entities in
connection with the discharge of their obligations pursuant to Section 4.2(b))
(collectively, “Losses”) incurred by the Partnership Entities in connection
with the Excluded Liabilities; provided, however, in no event shall such
indemnification obligation, or the term “Losses,” cover or include exemplary,
punitive, special, consequential, indirect, or incidental damages or lost
profits suffered by the Partnership Entities in connection with the Excluded
Liabilities, except to the extent such

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exemplary, punitive, special, consequential, indirect or incidental damages or lost profits are actually paid
by a Partnership Entity to a third party.

     4.2 Indemnification Procedures.

          (a) EPCO shall have the right to control all aspects of the defense of
any claims (and any counterclaims) related to the Excluded Liabilities,
including, without limitation, the selection of counsel, determination of
whether to appeal any decision of any court and the settling of any such
matter or any issues relating thereto; provided, however, that no such
settlement shall be entered into without the consent of the Partnership
Entities unless (i) it includes a full release of the Partnership Entities
from such matter or issues, as the case may be or (ii) following such
settlement there is no realistic scenario under which the Partnership
Entities could be held liable for such matter or issues.

          (b) The Partnership Entities agree, at their own cost and expense, to
cooperate fully with EPCO with respect to all aspects of the defense of any
claims related to the Excluded Liabilities, including, without limitation,
the prompt furnishing to EPCO of any correspondence or other notice relating
thereto that the Partnership Entities may receive, permitting the names of
the Partnership Entities to be utilized in connection with such defense and
the making available to EPCO of any files, records or other information of
the Partnership Entities that EPCO considers relevant to such defense;
provided, however, that in connection therewith EPCO agrees to use reasonable
efforts to minimize the impact thereof on the operations of such Partnership
Entities. In no event shall the obligation of the Partnership Entities to
cooperate with EPCO as set forth in the immediately preceding sentence be
construed as imposing upon the Partnership Entities an obligation to hire and
pay for counsel in connection with the defense of any claims related to the
Excluded Litigation.

ARTICLE 5: OTHER AGREEMENTS

     5.1 Insurance Matters. EPCO hereby agrees to cause the Partnership Entities to
be named as additional insureds in EPCO’s insurance program, as in effect from
time to time. Subject to Section 2.5, each of the Partnership Entities shall
be allocated, and pay for, such insurance coverage in an amount equal to EPCO’s
cost of insuring the assets and operations of such Partnership Entity, and
generally in accordance with the allocations and methodology used prior to the
Effective Date.

     5.2 Sublease of Equipment. Effective June 1, 1998, EPCO and OLP entered into
one or more Sublease Agreements (the “Sublease Agreements”), pursuant to which
EPCO agreed to sublease to OLP the equipment covered by the Retained Leases.
EPCO has assigned to OLP all options held by EPCO to purchase any and all
equipment subject to the Sublease Agreements and the Retained Leases.

     5.3 EPCO’s Employees. The obligation of OLP to pay the Administrative Services
Fee shall, as such obligation relates to EPCO’s expenses incurred to compensate
its employees providing the EPCO Services, reimburse EPCO for the appropriate
pro rata cost of such employees’ salaries, wages, bonuses, benefits, social
security taxes, workers compensation

-6-

 

insurance, retirement and insurance benefits, training, and other direct and indirect costs of such employee fringe
benefits. OLP shall not be obligated to pay any amount directly to EPCO’s
employees; provided however, if EPCO ever fails to pay any employee providing
EPCO Services to the Partnership Entities within 30 days following the date
such employee’s payment is due:

               (i) any Partnership Entity may (w) pay such employee directly, (x)
employ such employee directly, (y) notify EPCO and begin to pay all employees
providing EPCO Services directly, or (z) notify EPCO that the portion of this
Agreement relating to the EPCO Services is terminated and employ directly any
or all of such employees, or employ such other individuals as the Partnership
Entities may choose in their sole discretion, and

               (ii) EPCO shall reimburse the Partnership Entities for any amount that
the Partnership Entities paid to EPCO, for EPCO’s employees providing the
EPCO Services, that EPCO did not pay to, or on behalf of, such employees.

          (b) Notwithstanding anything implied in Section 5.3(a) to the contrary,
the Partnership Entities, acting through OLP, shall have the right, at any
time upon at least 90 days notice to EPCO, to terminate the portion of this
Agreement relating to the EPCO Services and to employ any or all of EPCO’s
employees providing the EPCO Services directly, or employ such other
individuals as the Partnership Entities may choose in their sole discretion.

     5.4
Business Opportunities. If the EPCO Group is offered by a third party, or discovers an opportunity
to acquire from a third party, a business or assets that is or are in the same
or similar line of business then being conducted by a Partnership Entity or in
a line of business that would be a natural extension of any business then being
conducted by a Partnership Entity (a “Business Opportunity”), the EPCO Group
shall promptly advise the Board of Directors of the General Partner of such
Business Opportunity and offer such Business Opportunity to the Partnership.
If the Board of Directors of the General Partner does not advise the EPCO Group
within ten days following the receipt of such notice that the Partnership
wishes to pursue such Business Opportunity, the EPCO Group shall then be
permitted to pursue such Business Opportunity. If the Board of Directors of
the General Partner advises the EPCO Group within such ten day period that the
Partnership wishes to pursue such Business Opportunity, the EPCO Group shall
not be permitted to pursue such Business Opportunity unless the Board of
Directors of the General Partner subsequently advises the EPCO Group that it
has abandoned its pursuit of such Business Opportunity.

ARTICLE 6: MISCELLANEOUS

     6.1 Choice of Law; Submission to Jurisdiction. This Agreement shall be subject
to and governed by the laws of the State of Texas. Each Party hereby submits
to the exclusive jurisdiction of the state and federal courts in the State of
Texas and to exclusive venue in Houston, Harris County, Texas.

     6.2 Notices. All notices or requests or consents provided for or permitted to
be given pursuant to this Agreement must be in writing and must be given by
depositing same in the United States mail, addressed to the Person to be
notified, postpaid, and registered or certified

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with return receipt requested or by delivering such notice in person or by telecopier or telegram to such
Person. Notice given by personal delivery or mail shall be effective upon
actual receipt. Notice given by telegram or telecopier shall be effective upon
actual receipt if received during the recipient’s normal business hours, or at
the beginning of the recipient’s next business day after receipt if not
received 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
set forth below such Party’s signature to this Agreement, or at such other
address as such Party may stipulate to the other Parties in the manner provided
in this Section 6.2.

     6.3 Entire Agreement; Supersedure. This Agreement constitutes the entire
agreement of the Parties relating to the matters contained herein, superseding
all prior contracts or agreements, whether oral or written, relating to the
matters contained herein.

     6.4 Effect of Waiver of Consent. No Party’s express or implied waiver of, or
consent to, any breach or default by any Person in the performance by such
Person of its obligations hereunder shall be deemed or construed to be a
consent or waiver to or of any other breach or default in the performance by
such Person of the same or any other obligations of such Person hereunder. Failure on the part of
a Party to complain of any act of any Person or to declare any Person in
default, irrespective of how long such failure continues, shall not constitute
a waiver by such Party of its rights hereunder until the applicable statute of
limitations period has run.

     6.5 Amendment or Modification. This Agreement may be amended or modified from
time to time only by the agreement of all the Parties; provided, however, that
MLP may not, without the prior approval of the Audit and Conflicts Committee,
agree to any amendment or modification of this Agreement that, in the
reasonable discretion of Enterprise GP, will materially and adversely affect
the Holders of Common Units.

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

     6.7 Counterparts. This Agreement may be executed in any number of counterparts
with the same effect as if all Parties had signed the same document. All
counterparts shall be construed together and shall constitute one and the same
instrument.

     6.8 Severability. If any provision of this Agreement or the application
thereof to any Person or circumstance shall be held invalid or unenforceable to
any extent, the remainder of this Agreement and the application of such
provision to other Persons or circumstances shall not be affected thereby and
shall be enforced to the greatest extent permitted by law.

     6.9 Further Assurances. In connection with this Agreement and all transactions
contemplated by this Agreement, each Party hereto agrees to execute and deliver
such additional documents and instruments and to perform such additional acts
as may be necessary or appropriate to effectuate, carry out and perform all of
the terms, provisions and conditions of this Agreement and all such
transactions.

     6.10 Withholding or Granting of Consent. Unless the consent or approval of a
Party is expressly required not to be unreasonably withheld (or words to
similar effect), each Party

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may, with respect to any consent or approval that it is entitled to grant pursuant to this Agreement, grant or withhold such
consent or approval in its sole and uncontrolled discretion, with or without
cause, and subject to such conditions as it shall deem appropriate.

     6.11 U.S. Currency. All sums and amounts payable or to be payable pursuant to the provisions of
this Agreement shall be payable in coin or currency of the United States of
America that, at the time of payment, is legal tender for the payment of public
and private debts in the United States of America.

     6.12 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.

     6.13 Negation of Rights of Third Parties. The provisions of this Agreement are
enforceable solely by the Parties, and no Limited Partner, Assignee or other
Person shall have the right to enforce any provision of this Agreement or to
compel any Party to comply with the terms of this Agreement.

     IN WITNESS WHEREOF, the Parties have executed this Agreement on October
22, 2004, but effective as of, the Effective Date.

	 	 	 	 	 
	 	 	EPCO, INC. (formerly known as Enterprise
	 	 	Products Company, a Texas corporation
	 
	 	 	 	 
	

	 	By:
	 	/s/ Richard H. Bachmann
	

	 	 	 	

	

	 	Name:
	 	Richard H. Bachmann
	

	 	Title:
	 	Executive Vice President and Chief Legal Officer
	 
	 	 	 	 
	 	 	Address for Notice:
	 	 	2707 North Loop West
	 	 	Houston, Texas 77008
	 	 	Telecopy No.: (713) 880-6631

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	 	 	ENTERPRISE PRODUCTS PARTNERS L.P.
	 
	 	 	 	 	 	 
	 	 	ENTERPRISE PRODUCTS OPERATING L.P.
	 
	 	 	 	 	 	 
	 	 	ENTERPRISE PRODUCTS GP, LLC,
	 	 	Individually and as Sole General Partner of Enterprise
Products Partners L.P., and
	 
	 	 	 	 	 	 
	 	 	ENTERPRISE PRODUCTS OLPGP, INC.,
	 	 	Individually and as Sole General
Partner of Enterprise Products Operating L.P.
	 
	 	 	 	 	 	 
	

	 	 	 	By:
	 	/s/ Michael A. Creel
	

	 	 	 	 	 	

	

	 	 	 	 	 	Michael A. Creel
	

	 	 	 	 	 	Executive Vice President and
	

	 	 	 	 	 	Chief Financial Officer
	 
	 	 	 	 	 	 
	 	 	Address for Notice:
	 	 	2727 North Loop West
	 	 	Houston, Texas 77008
	 	 	Telecopy No.: (713) 880-6570

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Attachment I

DEFINED TERMS

     “Administrative Services Fee” shall have the meaning set forth in Section
2.2 hereto.

     “Affiliate” shall have the meaning attributed to such term in the MLP
Agreement; provided, however, that for the purposes of this Agreement none of
the Partnership Entities shall be deemed to be an Affiliate of EPCO.

     “Agreement” shall mean this Second Amended and Restated EPCO Agreement, as
it may be amended, modified, or supplemented from time to time.

     “Applicable Period” shall mean the period commencing on the Effective Date
and terminating on the earlier of (a) the date on which the general partner of
MLP ceases to be Enterprise Products GP, LLC or another Person that is an
Affiliate of EPCO, and (b) the date on which the general partner of OLP ceases
to be Enterprise Products OLPGP, Inc. or another person that is an affiliate of
EPCO.

     “EPCO Group” shall have the meaning set forth in Recitals.

     “EPCO Services” shall have the meaning set forth in Section 2.1 hereto.

     “Excluded Liabilities” shall mean the following liabilities and
obligations:

     (a) all indebtedness of EPCO and its Affiliates for borrowed money;
and

     (b) any income tax liability of EPCO that may result from the
consummation of the transactions contemplated by the First Amendment or
this Agreement.

     “First Amendment” shall have the meaning set forth in the Recitals.

     “General Partner” shall mean Enterprise GP and Enterprise OLPGP and their
successors as general partner of MLP and OLP, respectively, unless the context
otherwise requires.

     “Losses” shall have the meaning set forth in Section 4.1.

     “MLP Agreement” shall mean that certain Fourth Amended and Restated
Agreement of Limited Partnership of Enterprise Products Partners L.P., dated as
of October 1, 2004, as amended, as same may be further amended from time to
time.

     “Name” and “Mark” shall mean the name “Enterprise”, as described in
Registration Number 1,236,995 registered on May 10, 1983 and issued by the
United States Patent and Trademark Office, and the mark “Enterprise”, as
described in Application Registration Number 1,292,612 registered on September
4, 1984 and issued by the United States Patent and Trademark Office.

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     “Partnership Entities” shall mean the General Partner, MLP, OLP and any
Affiliate controlled (and only so long as such Affiliates are controlled) by
the General Partner, MLP or OLP (as the term “control” is used in the
definition of “Affiliate” in the MLP Agreement).

     “Party” shall mean any one of the Persons that executes this Agreement.

     “Plan of Merger” shall mean that certain Plan of Merger dated June 1, 1998
by and among EPCO, HSC Pipeline Partnership, L.P., Chunchula Pipeline Company,
LLC, Propylene Pipeline Partnership, L.P., Cajun Pipeline Company, LLC, and
Enterprise Texas Operating L.P., as amended by that certain First Amendment to
Plan of Merger among such parties dated effective as of June 1, 1998.

     "Retained Leases” shall have the meaning set forth in Section 2.2.

     “Sublease Agreements” shall have the meaning set forth in Section 5.2.

-12-

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