Document:

EX-10.1

EMPLOYMENT AGREEMENT

THIS AGREEMENT, (“Agreement”) made and entered into as of this 7th day of June, 2006, by and
between The Kansas City Southern Railway Company, a Missouri corporation (“Railway”), and Michael
K. Borrows, an individual (“Executive”).

WHEREAS, Executive has been offered employment by Railway, and Railway and Executive desire
for Railway to employ Executive on the terms and conditions set forth in this Agreement and to
provide an incentive to Executive to remain in the employ of Railway hereafter, particularly in the
event of any change in control (as herein defined) of Kansas City Southern, a Delaware corporation
(“KCS”), or Railway, thereby establishing and preserving continuity of management of Railway.

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, it
is agreed by and between Railway and Executive as follows:

1. Employment. Railway hereby employs Executive as its Vice President Financial Reporting
& Tax, to serve at the pleasure of the Board of Directors of Railway (the “Railway Board”) and to
have such duties, powers and responsibilities as may be prescribed or delegated from time to time
by the President or other officer to whom Executive reports, subject to the powers vested in the
Railway Board and in the stockholders of Railway. Executive shall faithfully perform Executive’s
duties under this Agreement to the best of Executive’s ability and Executive shall devote
substantially all of Executive’s working time and efforts to the business and affairs of Railway
and its affiliates. For purposes of this Agreement, an “affiliate” of Railway is KCS and any
United States or foreign corporation or partnership or other similar entity with respect to which
Railway or KCS owns, directly or indirectly, at least 15% of the voting power of such entity.

2. Compensation. Railway shall pay Executive as compensation for Executive’s services
hereunder an annual base salary at the rate approved by the Compensation and Organization Committee
of the Board of Directors of KCS (the “KCS Board”). Such rate shall not be reduced except as
agreed by the parties hereto or except as part of a general salary reduction program imposed by
Railway for non-union employees and applicable to all officers of Railway, not related to a Change
of Control.

3. Benefits. During the period of Executive’s employment hereunder, Railway shall provide
Executive with coverage under such benefit plans and programs as are made generally available to
similarly situated employees of Railway, provided (a) Railway shall have no obligation with respect
to any plan or program if Executive is not eligible for coverage thereunder, and (b) Executive
acknowledges that any stock or equity participation awards (including by way of example, but not
limited to, stock options or restricted stock) are granted in the discretion of the KCS Board or
the Compensation and Organization Committee of the KCS Board and that Executive has no right to
receive any such stock or equity participation awards or any particular number or level of such
stock or equity participation awards, if any. In determining contributions, coverage and benefits
under any disability insurance policy and under any cash compensation-based plan provided to
Executive pursuant to this Agreement, it shall be assumed that the value of Executive’s annual
compensation is 145% of Executive’s annual base salary. Executive acknowledges that all rights and
benefits under benefit plans and programs shall be governed by the official text of each plan or
program and not by any summary or description thereof or any provision of this Agreement (except to
the extent that this Agreement expressly modifies such benefit plans or programs) and that neither
Railway nor KCS is under any obligation to continue in effect or to fund any such plan or program,
except as provided in Paragraph 7 hereof.

4. Term and Termination. The “Term” of this Agreement shall begin on the date first
written above and continue until terminated as provided in (a) through (d) of this Section 4.

(a) Termination by Executive. Executive may terminate this Agreement and Executive’s
employment hereunder by providing at least thirty (30) days advance written notice to Railway,
except that in the event of any material breach of this Agreement by Railway, Executive may
terminate this Agreement and Executive’s employment hereunder immediately upon notice to Railway.

(b) Death or Disability. This Agreement and Executive’s employment hereunder shall
terminate automatically on the death or disability of Executive, except to the extent employment is
continued under Railway’s disability plan. For purposes of this Agreement, Executive shall be
deemed to be disabled if Executive qualifies for disability benefits under Railway’s long-term
disability plan.

(c) Termination by Railway For Cause. Railway may terminate this Agreement and
Executive’s employment “for cause” immediately upon notice to Executive. For purposes of this
Agreement (except for Paragraph 7), termination “for cause” shall mean termination based upon any
one or more of the following:

(i) Any material breach of this Agreement by Executive;

(ii) Executive’s dishonesty involving Railway or any affiliate of Railway;

(iii) Gross negligence or willful misconduct in the performance of Executive’s duties
as determined in good faith by the Railway Board;

(iv) Executive’s failure to substantially perform Exectuve’s duties and
responsibilities hereunder, including without limitation Executive’s willful failure to
follow reasonable instructions of the President or other officer to whom Executive reports;

(v) Executive’s breach of an express employment policy of Railway or any affiliate of
Railway;

(vi) Executive’s fraud or criminal activity;

(vii) Embezzlement or misappropriation by Executive; or

(viii) Executive’s breach of Executive’s fiduciary duty to Railway or any affiliate of
Railway.

(d) Termination by Railway Other Than For Cause.

(i) Railway may terminate this Agreement and Executive’s employment other than for
cause immediately upon notice to Executive, and in such event, Railway shall provide
severance benefits to Executive in accordance with Paragraph 4(d)(ii) below. Executive
acknowledges and agrees that such severance benefits constitute the exclusive remedy of
Executive upon termination of employment other than for cause. Notwithstanding any other
provision of this Agreement, as a condition to receiving such severance benefits, Executive
shall execute a full release of claims in favor of Railway and its affiliates in the form
attached hereto as Appendix A.

(ii) Unless the provisions of Paragraph 7 of this Agreement are applicable, if
Executive’s employment is terminated under Paragraph 4(d)(i), Railway shall: (1) continue,
for a period of twelve (12) months following such termination, to pay to Executive as
severance pay a monthly amount equal to one-twelfth (1/12th) of the annual base salary
referenced in Paragraph 2 above, at the rate in effect immediately prior to termination,
and, (2) for a period of twelve (12) months following such termination, reimburse Executive
for the cost of continuing the health insurance coverage provided pursuant to this Agreement
or obtaining health insurance coverage comparable to the health insurance provided pursuant
to this Agreement, and obtaining coverage comparable to the life insurance provided pursuant
to this Agreement, unless Executive is provided comparable health or life insurance coverage
in connection with other employment. The foregoing obligations of Railway shall continue
until the end of such twelve (12) month period notwithstanding the death or disability of
Executive (except, in the event of death, the obligation to reimburse Executive for the cost
of life insurance shall not continue). In the calendar year in which termination of
employment occurs, Executive shall be eligible to receive benefits under the Railway
Incentive Compensation Plan and any executive incentive compensation plan in which Executive
participates (the “Executive Plan”) (provided, however, that such plans then are in
existence and Executive was entitled to participate immediately prior to termination) in
accordance with the provisions of such plans then applicable, and severance pay received in
such year shall be taken into account for the purpose of determining benefits, if any, under
the Railway Incentive Compensation Plan but not under the Executive Plan. After the
calendar year in which termination occurs, Executive shall not be entitled to accrue or
receive benefits under the Railway Incentive Compensation Plan or the Executive Plan with
respect to the severance pay provided herein, notwithstanding that benefits under either or
both such plans are still generally available to executive employees of Railway. After
termination of employment, Executive shall not be entitled to accrue or receive benefits
under any other employee benefit plan or program, except that Executive shall be entitled to
participate in the KCS 401(k) and Profit Sharing Plan, as amended from time to time, and the
KCS Employee Stock Ownership Plan, as amended from time to time, (provided Railway active
employees then still participate in such plans) in the year of termination of employment
only if Executive meets all requirements of such plans for participation in such year.

5. Confidentiality and Non-Disclosure.

(a) Executive understands and agrees that Executive will be given Confidential Information (as
defined below) during Executive’s employment with Railway relating to the business of Railway and
its affiliates subject to Executive’s agreement herein. Executive hereby expressly agrees to
maintain in strictest confidence and not to use in any way (including without limitation in any
future business relationship of Executive), publish, disclose or authorize anyone else to use in
any way, publish or disclose, any Confidential Information relating in any manner to the business
or affairs of Railway or any of its affiliates or customers. Executive further agrees not to
remove or retain any figures, calculations, letters, documents, lists, papers, or copies thereof,
which embody Confidential Information of Railway or any of its affiliates, and to return, prior to
Executive’s termination of employment for any reason, any such information in Executive’s
possession. If Executive discovers, or comes into possession of, any such information after
Executive’s termination, Executive shall promptly return it to Railway. Executive acknowledges
that the provisions of this paragraph are consistent with Railway’s policies and procedures to
which Executive, as an employee of Railway, is bound.

(b) For purposes of this Agreement, “Confidential Information” includes, but is not limited
to, information in the possession of, prepared by, obtained by, compiled by, or that is used by
Railway or any of its affiliates or customers and (i) is proprietary to, about, or created by
Railway or any of its affiliates or customers; (ii) gives Railway or any of its affiliates or
customers some competitive business advantage, the opportunity of obtaining such advantage, or
disclosure of which might be detrimental to the interest of Railway or any of its affiliates or
customers; and (iii) is not typically disclosed by Railway or any of its affiliates or customers,
or known by persons who are not employed by Railway or any of its affiliates or customers. Without
in any way limiting the foregoing and by way of example, Confidential Information shall include:
information pertaining to business operations of Railway or any of its affiliates or customers such
as financial and operational information and data, operational plans and strategies, business and
marketing strategies, pricing information, plans for various products and services, and acquisition
and divestiture planning.

(c) In the event of any breach of this Paragraph 5 by Executive, Railway shall be entitled to
terminate any and all remaining severance benefits under Paragraph 4(d)(ii) and shall be entitled
to pursue such other legal and equitable remedies as may be available. Executive acknowledges,
understands and agrees that Railway and its affiliates will suffer immediate and irreparable harm
if Executive fails to comply with any of Executive’s obligations under this Paragraph 5, and that
monetary damages alone will be inadequate to compensate Railway or any of its affiliates for such
breach. Accordingly, Executive agrees that Railway and its affiliates shall, in addition to any
other remedies available to it at law or in equity, be entitled to temporary, preliminary, and
permanent injunctive relief and specific performance to enforce the terms of this Paragraph 5
without the necessity of proving inadequacy of legal remedies or irreparable harm or posting bond.

6. Duties Upon Termination; Survival.

(a) Duties. Upon termination of this Agreement by Railway or Executive for any
reason, Executive shall immediately sign such written resignations from all positions as an
officer, director or member of any committee or board of Railway or of any of its affiliates as may
be requested by Railway or such affiliate and shall sign such other documents and papers relating
to Executive’s employment, benefits and benefit plans as Railway may reasonably request.

(b) Survival. The provisions of Paragraphs 5, 6(a) and 7 of this Agreement shall
survive any termination of this Agreement by Railway or Executive, and the provisions of Paragraph
4(d)(ii) shall survive any termination of this Agreement by Railway under Paragraph 4(d)(i).

7. Continuation of Employment Upon Change in Control.

(a) Continuation of Employment. Subject to the terms and conditions of this Paragraph
7, in the event of a Change in Control (as defined in Paragraph 7(d)) at any time during the term
of this Agreement, Executive agrees to remain in the employ of Railway for a period of three years
(the “Three Year Period”) from the date of such Change in Control (the “Control Change Date”), and
Railway agrees to continue to employ Executive for the Three Year Period. During the Three Year
Period, (i) the Executive’s position (including offices, titles, reporting requirements and
responsibilities), authority and duties shall be at least commensurate in all material respects
with the most significant of those held, exercised and assigned at any time during the 12 month
period immediately before the Control Change Date and (ii) the Executive’s services shall be
performed at the location where Executive was employed immediately before the Control Change Date
or at any other location less than 40 miles from such former location. During the Three Year
Period, Railway shall continue to pay to Executive an annual base salary on the same basis and at
the same intervals as in effect prior to the Control Change Date at a rate not less than 12 times
the highest monthly base salary paid or payable to the Executive by Railway in respect of the
12-month period immediately before the Control Change Date.

(b) Benefits. During the Three-Year Period, Executive shall be entitled to
participate, on the basis of the executive position of Executive, in each of the following Railway
plans or KCS plans in which active employees of Railway may then participate (together, the
“Specified Benefits”) in existence, and in accordance with the terms thereof, at the Control Change
Date:

(i) any benefit plan, and trust fund associated therewith, related to: (A) life,
health, dental, disability, accidental death and dismemberment insurance or accrued but
unpaid vacation time; (B) profit sharing, thrift or deferred savings (including deferred
compensation, such as under Section 401(k) plans); (C) retirement or pension benefits;
(D) ERISA excess benefits and similar plans and (E) tax favored employee stock ownership
(such as under ESOP, and Employee Stock Purchase programs); and

(ii) any other benefit plans hereafter made generally available to executives of
Executive’s level or to the employees of Railway generally.

In addition, if not otherwise occurring under applicable award agreements, Railway and KCS
shall use their best efforts to cause all outstanding options or other equity awards held by
Executive under any stock option or other plan of KCS or Railway or its affiliates to become
immediately vested and exercisable on the Control Change Date, and to the extent that such awards
are not vested and are subsequently forfeited, the Executive shall receive a lump-sum cash payment
within five (5) days after the awards are forfeited equal to, in the case of stock options, the
difference between the fair market value of the shares of stock subject to the non-vested,
forfeited options determined as of the date such options are forfeited and the exercise price for
such options, and, in the case of other equity awards, equal to the amount that would have been
includible in the Executive’s gross income on the date of forfeiture if such awards had instead on
such date become vested and, if applicable, were then exercised (ignoring, for this purpose, the
effect of any election made by the Executive under Section 83(b) of the Internal Revenue Code of
1986, as amended (the “Code”)). During the Three Year Period Executive shall be entitled to
participate, on the basis of the executive position of Executive, in any incentive compensation
plan of Railway in accordance with the terms thereof at the Control Change Date; provided that if
under Railway programs or Executive’s Employment Agreement in existence immediately prior to the
Control Change Date, there are written limitations on participation for a designated time period in
any incentive compensation plan, such limitations shall continue after the Control Change Date to
the extent so provided for prior to the Control Change Date.

If the amount of contributions or benefits with respect to the Specified Benefits or any
incentive compensation is determined on a discretionary basis under the terms of the Specified
Benefits or any incentive compensation plan immediately prior to the Control Change Date, the
amount of such contributions or benefits during the Three-Year Period for each of the Specified
Benefits, to the extent permissible by law and the applicable plan document, if any, shall not be
less than the average annual contributions or benefits for each Specified Benefit for the three
plan years ending prior to the Control Change Date and, in the case of any incentive compensation
plan, the amount of the incentive compensation during the Three Year Period shall not be less than
75% of the maximum that could have been paid to the Executive under the terms of the incentive
compensation plan.

(c) Payment. With respect to any plan or agreement under which Executive would be
entitled at the Control Change Date to receive Specified Benefits or incentive compensation as a
general obligation of Railway which has not been separately funded (including specifically, but not
limited to, those referred to under Paragraph 7(b)(i)(D) above), Executive shall receive within
five (5) days after such date full payment in cash of all amounts to which he is then entitled
thereunder.

(d) Change in Control. For purposes of this Agreement, a “Change in Control” shall be
deemed to have occurred if:

(i) for any reason at any time less than seventy-five percent (75%) of the members of
the KCS Board shall be individuals who fall into any of the following categories:
(A) individuals who were members of the KCS Board on the date of the Agreement; or
(B) individuals whose election, or nomination for election by KCS’s stockholders, was
approved by a vote of at least seventy-five percent (75%) of the members of the KCS Board
then still in office who were members of the KCS Board on the date of the Agreement; or
(C) individuals whose election, or nomination for election, by KCS’s stockholders, was
approved by a vote of at least seventy-five percent (75%) of the members of the KCS Board
then still in office who were elected in the manner described in (B) above, or

(ii) any “person” (as such term is used in Sections 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934 (the “Exchange Act”)) other than KCS shall have become after
the date of the Agreement, according to a public announcement or filing, the “beneficial
owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of Railway or KCS representing thirty percent (30%) (or, with respect to
Paragraph 7(c) hereof, 40%) or more (calculated in accordance with Rule 13d-3) of the
combined voting power of Railway’s or KCS’s then outstanding voting securities; or

(iii) the stockholders of Railway or KCS shall have approved a merger, consolidation or
dissolution of Railway or KCS or a sale, lease, exchange or disposition of all or
substantially all of Railway’s or KCS’s assets, if persons who were the beneficial owners of
the combined voting power of Railway’s or KCS’s voting securities immediately before any
such merger, consolidation, dissolution, sale, lease, exchange or disposition do not
immediately thereafter, beneficially own, directly or indirectly, in substantially the same
proportions, more than 60% of the combined voting power of any corporation or other entity
resulting from any such transaction.

(e) Termination After Control Change Date. Notwithstanding any other provision of
this Paragraph 7, at any time after the Control Change Date, Railway may terminate the employment
of Executive (the “Termination”), but unless such Termination is for Cause as defined in
subparagraph (g) or for disability, within five (5) days of the Termination Railway shall pay to
Executive his full base salary through the Termination, to the extent not theretofore paid, plus a
lump sum amount (the “Special Severance Payment”) equal to the product of: (i) 160% of his annual
base salary specified in Paragraph 7(a) multiplied by (ii) Two; and Specified Benefits (excluding
any incentive compensation) to which Executive was entitled immediately prior to Termination shall
continue until the end of the 3-year period (“Benefits Period”) beginning on the date of
Termination. If any plan pursuant to which Specified Benefits are provided immediately prior to
Termination would not permit continued participation by Executive after Termination, then Railway
shall pay to Executive within five (5) days after Termination a lump sum payment equal to the
amount of Specified Benefits Executive would have received under such plan if Executive had been
fully vested in the average annual contributions or benefits in effect for the three plan years
ending prior to the Control Change Date (regardless of any limitations based on the earnings or
performance of Railway or any of its affiliates) and a continuing participant in such plan to the
end of the Benefits Period. The Executive’s rights under this Paragraph 7(e) shall be in addition
to, and not in lieu of, any post-termination continuation coverage or conversion rights the
Executive may have pursuant to applicable law, including without limitation continuation coverage
required by Section 4980 of the Code. Nothing in this Paragraph 7(e) shall be deemed to limit in
any manner the reserved right of Railway, in its sole and absolute discretion, to at any time
amend, modify or terminate health, prescription or dental benefits for active or retired employees
generally.

(f) Resignation After Control Change Date. In the event of a Change in Control as
defined in Paragraph 7(d), thereafter, upon good reason (as defined below), Executive may, at any
time during the three-year period following the Change in Control, in his sole discretion, on not
less than thirty (30) days’ written notice (the “Notice of Resignation”) to the Secretary of
Railway and effective at the end of such notice period, resign his employment with Railway (the
“Resignation”). Within five (5) days of such a Resignation, Railway shall pay to Executive his
full base salary through the effective date of such Resignation, to the extent not theretofore
paid, plus a lump sum amount equal to the Special Severance Payment (computed as provided in the
first sentence of Paragraph 7(e), except that for purposes of such computation all references to
“Termination” shall be deemed to be references to “Resignation”). Upon Resignation of Executive,
Specified Benefits to which Executive was entitled immediately prior to Resignation shall continue
on the same terms and conditions as provided in Paragraph 7(e) in the case of Termination
(including equivalent payments provided for therein). For purposes of this Agreement, “good
reason” means any of the following:

(i) the assignment to the Executive of any duties inconsistent in any respect with the
Executive’s position (including offices, titles, reporting requirements or
responsibilities), authority or duties as contemplated by Section 7(a)(i), or any other
action by Railway which results in a diminution or other material adverse change in such
position, authority or duties;

(ii) any failure by Railway to comply with any of the provisions of Paragraph 7;

(iii) Railway’s requiring the Executive to be based at any office or location other
than the location described in Section 7(a)(ii);

(iv) any other material adverse change to the terms and conditions of the Executive’s
employment; or

(v) any purported termination by Railway of the Executive’s employment other than as
expressly permitted by this Agreement (any such purported termination shall not be effective
for any other purpose under this Agreement).

A passage of time prior to delivery of the Notice of Resignation or a failure by the Executive to
include in the Notice of Resignation any fact or circumstance which contributes to a showing of
Good Reason shall not waive any right of the Executive under this Agreement or preclude the
Executive from asserting such fact or circumstance in enforcing rights under this Agreement.

(g) Termination for Cause After Control Change Date. Notwithstanding any other
provision of this Paragraph 7, at any time after the Control Change Date, Executive may be
terminated by Railway “for cause.” Cause means commission by the Executive of any felony or
willful breach of duty by the Executive in the course of the Executive’s employment; except that
Cause shall not mean:

(i) bad judgment or negligence;

(ii) any act or omission believed by the Executive in good faith to have been in or not
opposed to the interest of Railway or any of its affiliates (without intent of the Executive
to gain, directly or indirectly, a profit to which the Executive was not legally entitled);

(iii) any act or omission with respect to which a determination could properly have
been made by the Railway Board that the Executive met the applicable standard of conduct for
indemnification or reimbursement under Railway’s by-laws, any applicable indemnification
agreement, or applicable law, in each case in effect at the time of such act or omission; or

(iv) any act or omission with respect to which Notice of Termination of the Executive
is given, more than 12 months after the earliest date on which any member of the Railway
Board, not a party to the act or omission, knew or should have known of such act or
omission.

Any Termination of the Executive’s employment by Railway for Cause shall be communicated to the
Executive by Notice of Termination.

(h) Expenses. If any dispute should arise under this Agreement after the Control
Change Date involving an effort by Executive to protect, enforce or secure rights or benefits
claimed by Executive hereunder, Railway shall pay (promptly upon demand by Executive accompanied by
reasonable evidence of incurrence) all reasonable expenses (including attorneys’ fees) incurred by
Executive in connection with such dispute, without regard to whether Executive prevails in such
dispute except that Executive shall repay Railway any amounts so received if a court having
jurisdiction shall make a final, non-appealable determination that Executive acted frivolously or
in bad faith by such dispute. To assure Executive that adequate funds will be made available to
discharge Railway’s obligations set forth in the preceding sentence, Railway has established a
trust and upon the occurrence of a Change in Control shall promptly deliver to the trustee of such
trust to hold in accordance with the terms and conditions thereof that sum which the Railway Board
shall have determined is reasonably sufficient for such purpose.

(i) Prevailing Provisions. On and after the Control Change Date, the provisions of
this Paragraph 7 shall control and take precedence over any other provisions of this Agreement
which are in conflict with or address the same or a similar subject matter as the provisions of
this Paragraph 7.

8. Mitigation and Other Employment. After a termination of Executive’s employment pursuant
to Paragraph 4(d)(i) or a Change in Control as defined in Paragraph 7(d), Executive shall not be
required to mitigate the amount of any payment provided for in this Agreement by seeking other
employment or otherwise, and except as otherwise specifically provided in Paragraph 4(d)(ii) with
respect to health and life insurance, no such other employment, if obtained, or compensation or
benefits payable in connection therewith shall reduce any amounts or benefits to which Executive is
entitled hereunder. Such amounts or benefits payable to Executive under this Agreement shall not
be treated as damages but as severance compensation to which Executive is entitled because
Executive’s employment has been terminated.

9. KCS Not an Obligor. KCS shall have no obligation for the payment of salary, benefits,
or other compensation hereunder, and all such obligations shall be the sole responsibility of
Railway.

10. Notice. Notices and all other communications to any party pursuant to this Agreement
shall be in writing and shall be deemed to have been given when personally delivered, delivered by
facsimile or deposited in the United States mail by certified or registered mail, postage prepaid,
addressed, in the case of Railway, to Railway at P.O. Box 219335, Kansas City, Missouri
64121-9335,, Attention: Secretary, or, in the case of the Executive, to him at P.O. Box 219335,
Kansas City, Missouri 64121-9335, or to such other address as a party shall designate by notice to
the other party.

11. Amendment. No provision of this Agreement may be amended, modified, waived or
discharged unless such amendment, waiver, modification or discharge is agreed to in writing signed
by Executive and by the President of Railway. No waiver by a party hereto at any time of any
breach by the other party hereto of, or compliance with, any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the time or at any prior or subsequent time.

12. Successors in Interest. The rights and obligations of Railway under this Agreement
shall inure to the benefit of and be binding in each and every respect upon the direct and indirect
successors and assigns of Railway, regardless of the manner in which such successors or assigns
shall succeed to the interests of Railway hereunder, and this Agreement shall not be terminated by
the voluntary or involuntary dissolution of Railway or by any merger or consolidation or
acquisition involving Railway, or upon any transfer of all or substantially all of Railway’s
assets, or terminated otherwise than in accordance with its terms. In the event of any such merger
or consolidation or transfer of assets, the provisions of this Agreement shall be binding upon and
shall inure to the benefit of the surviving corporation or the corporation or other person to which
such assets shall be transferred. Neither this Agreement nor any of the payments or benefits
hereunder may be pledged, assigned or transferred by Executive either in whole or in part in any
manner, without the prior written consent of Railway.

13. Severability. The invalidity or unenforceability of any particular provision of this
Agreement shall not affect the other provisions hereof, and this Agreement shall be construed in
all respects as if such invalid or unenforceable provisions were omitted.

14. Controlling Law and Jurisdiction. The validity, interpretation and performance of this
Agreement shall be subject to and construed under the laws of the State of Missouri, without regard
to principles of conflicts of law.

15. Amendment to Agreement for Code Section 409A Compliance. This Agreement may constitute
a nonqualified deferred compensation plan within the meaning of Code Section 409A of the Internal
Revenue Code of 1986, as amended (“Code”), with respect to certain of its provisions. It is the
intention of Executive and KCSR that in such event this Agreement satisfy the requirements of Code
Section 409A so that benefits hereunder, if any, are not included in gross income under Code
Section 409A (whether or not included in gross income under another Code provision). At the time
of the execution of this Agreement final Treasury Regulations interpreting Code Section 409A are
pending. The parties hereto agree that subsequent to the finalization of such pending Treasury
Regulations, this Agreement will be amended or restated as necessary for the purpose of satisfying
the requirements of Code Section 409A and until the time of such amendment or restatement, this
Agreement will be interpreted and administered accordingly.

16. Entire Agreement. This Agreement constitutes the entire agreement among the parties
with respect to the subject matter hereof and terminates and supersedes all other prior agreements
and understandings, both written and oral, between the parties with respect to the terms of
Executive’s employment or severance arrangements.

[SIGNATURES ON THE FOLLOWING PAGE]

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the 11th day of
September, 2006.

THE KANSAS CITY SOUTHERN RAILWAY COMPANY

By: /s/ Arthur L. Shoener

Arthur L. Shoener, President and CEO

EXECUTIVE

/s/ Michael K. Borrows

	 	 	Michael K. Borrows

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Appendix A

WAIVER AND RELEASE

In consideration of the benefits described in the Employment Agreement, I do hereby fully
waive all claims and release the Kansas City Southern Railway Company (KCSR), and its affiliates,
parents, subsidiaries, successors, assigns, directors and officers, fiduciaries, employees and
agents, as well as any employee benefit plans (collectively “affiliates”) from liability and
damages related in any way to any claim I may have against KCSR or its affiliates. This Waiver and
Release includes, but is not limited to all claims, causes of action and rights under Title VII of
the Civil Rights Act of 1964, as amended; the Civil Rights Act of 1991; the Age Discrimination in
Employment Act of 1967, as amended; the Civil Rights Act of 1866; the American with Disabilities
Act of 1990; the Rehabilitation Act of 1973; the Older Workers Benefit Protection Act of 1990; the
Employee Retirement Income Security Act of 1974, as amended; the Worker Adjustment and Retraining
Notification Act; the Family and Medical Leave Act; the Federal Employers Liability Act; the KCSR
Labor Act, including bumping rights, rights to file a grievance, rights to a hearing (whether
before any company official, any system, group, regional or special adjustment board, the National
Railroad Adjustment Board, or any other entity), and any rights to arbitration thereunder; the
Missouri Human Rights Act, the Kansas Act Against Discrimination, the Kansas and Missouri Workers’
Compensation acts, and all local state and federal statutes and regulations; all claims arising
from labor protective conditions imposed by the Interstate Commerce Commission or the Surface
Transportation Board; any incentive or benefit plan or program of KCSR or any affiliate, and any
rights under any collective bargaining agreement, including seniority rights, bumping rights and
reinstatement rights, rights to file or assert a grievance or other complaint, rights to a hearing,
or rights to arbitration under such agreement; and all rights under common law such as breach of
contract, tort or personal injury of any sort.

I understand that this Waiver and Release also precludes me from recovering any relief as a
result of any lawsuit, grievance or claims brought on my behalf and arising out of my employment or
resignation of, or separation from employment, provided that nothing in this Waiver and Release may
affect my entitlement, if any, to workers’ compensation or unemployment compensation.
Additionally, nothing in this Waiver and Release prohibits me from communications with, filing a
complaint with, or full cooperation in the investigations of, any governmental agency on matters
within their jurisdictions. However, as stated above, this Waiver and Release does prohibit me
from recovering any relief, including monetary relief, as a result of such activities.

If any term, provision, covenant, or restriction of this Waiver and Release is held by a court
of competent jurisdiction to be invalid, void or unenforceable, the remainder of this Waiver and
Release and the other terms, provisions, covenants and restrictions hereof shall remain in full
force and effect and shall in no way be affected, impaired or invalidated. I understand and agree
that, in the event of breach by me of any of the terms and conditions of this Waiver and Release,
KCSR will be entitled to recover all costs and expenses as a result of my breach, including but not
limited to, reasonable attorneys’ fees and costs.

I have read this Waiver and Release and I understand all of its terms. I enter into and sign
this Waiver and Release knowingly and voluntarily, with full knowledge of what it means.

	 	 	 
	Date

	 	Employee Signature

Employee Name (Please Print)
	 
	 	 

3EX-10.1 Redemption agreement

    
      

    

    REDEMPTION
      AGREEMENT

     

    

     

    by
      and between

     

    

     

    ENERGY
      TRANSFER PARTNERS, L.P.

     

    

     

    and

     

    

     

    CCE
      HOLDINGS, LLC

     

    

     

    Dated
      as of

     

    September
      14, 2006

     

    

     

     

     

    

     

    
      
        
           

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    

      TABLE
        OF CONTENTS

       

      
        	
                ARTICLE
                  I

              	 
	
                DEFINITIONS

              	 
	
                Section
                  1.1 Specific Definitions

              	
                2

              
	
                ARTICLE
                  II

              	 
	
                REDEMPTION
                  OF 50% CCE INTEREST

              	
                22

              
	
                Section
                  2.1 Agreement
                  to Redeem 50% CCE Interest 

              	
                22

              
	
                Section
                  2.2 Time
                  and Place of Closing

              	
                23

              
	
                Section
                  2.3 Pre-Closing
                  Matters

              	
                24

              
	
                Section
                  2.4 Post-Closing
                  Adjustment

              	
                25

              
	
                Section
                  2.5 Deliveries
                  by CCE at the Closing 

              	
                27

              
	
                Section
                  2.6 Deliveries
                  by ETP at the Closing

              	
                28

              
	
                ARTICLE
                  III

              	 
	
                REPRESENTATIONS
                  AND WARRANTIES OF CCE

              	
                28

              
	
                Section
                  3.1 Organization;
                  Qualification

              	
                28

              
	
                Section
                  3.2 Authority
                  Relative to this Agreement and the CCE Acquisition
                  Agreement

              	
                30

              
	
                Section
                  3.3 TPC
                  Interests

              	
                32

              
	
                Section
                  3.4 Consents
                  and Approvals

              	
                32

              
	
                Section
                  3.5 No
                  Conflict or Violation

              	
                32

              
	
                Section
                  3.6 Financial
                  Information

              	
                34

              
	
                Section
                  3.7 Contracts

              	
                34

              
	
                Section
                  3.8 Compliance
                  with Law

              	
                36

              
	
                Section
                  3.9 Permits

              	
                36

              
	
                Section
                  3.10 Litigation

              	
                36

              
	
                Section
                  3.11 Title
                  to Properties

              	
                36

              
	
                Section
                  3.12 Employee
                  Matters

              	
                38

              
	
                Section
                  3.13 Labor
                  Relations

              	
                42

              
	
                Section
                  3.14 Intellectual
                  Property

              	
                42

              
	
                Section
                  3.15 Environmental
                  Matters

              	
                43

              
	
                Section
                  3.16 Tax
                  Matters

              	
                45

              
	
                Section
                  3.17 Absence
                  of Certain Changes or Events

              	
                45

              
	
                Section
                  3.18 Absence
                  of Undisclosed Liabilities

              	
                46

              
	
                Section
                  3.19 Brokerage
                  and Finders’ Fees

              	
                46

              
	
                Section
                  3.20 Affiliated
                  Transactions

              	
                46

              
	
                Section
                  3.21 Insurance

              	
                46

              
	
                Section
                  3.22 Regulatory
                  Matters

              	
                46

              
	
                Section
                  3.23 Internal
                  Controls

              	
                48

              
	
                Section
                  3.24 Hedging

              	
                49

              
	
                Section
                  3.25 Bank
                  Accounts; Powers of Attorney

              	
                49

              
	
                Section
                  3.26 Gas
                  Imbalances

              	
                49

              
	
                Section
                  3.27 No
                  Other Representations or Warranties

              	
                49

              

      

    

    -
      i -

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ARTICLE
      IV REPRESENTATIONS AND WARRANTIES OF ETP                  31                                            

    Section
      4.1 Corporate Organization; Qualification                                31     

    Section
      4.2  Authority Relative to this Agreement                                32

    Section
      4.3  50% CCE Interest                                            32

    Section
      4.4 Consents
      and Approvals             32                                                                                                           
      

    Section
      4.5 No
      Conflict or Violation                                                33

    Section
      4.6 Litigation                                                        33

    Section
      4.7 Availability
      of Funds                                                    33

    Section
      4.8 Brokerage
      and Finders’ Fees                                                33

    Section
      4.9 Investment
      Representations.                                                33

    Section
      4.10 No
      Other
      Representations or Warranties                                          34

     

    ARTICLE
      V
COVENANTS
      OF THE PARTIES                                                34

    Section
      5.1 Conduct
      of Business.                                                    34

    Section
      5.2 Access
      to
      Properties and Records.                                            37

    Section
      5.3 Consents
      and Approvals.                                                   38

    Section
      5.4 Further
      Assurances                                                        39

    Section
      5.5 Employee
      Matters.                                                        39

    Section
      5.6 Tax
      Covenants.                                                        45

    Section
      5.7 Control
      of Administrative and Regulatory Proceedings                                50

    Section
      5.8 Maintenance
      of Insurance Policies.                                            50

    Section
      5.9 Preservation
      of Records                                                    51

    Section
      5.10 Public
      Statements                                                        51

    Section
      5.11 Assignment
      of Trademarks.                                                    52

    Section
      5.12 Commercially
      Reasonable Efforts                                                52

    Section
      5.13 Financial
      Statements; Financial Records of CCE.                                        52

    Section
      5.14 Covenants
      Regarding the 50% CCE Interest.                                        54

    Section
      5.15 No-Hire/Non-Solicitation54

    Section
      5.16 CCE
      Executive Committee55

    Section
      5.17 Directors’
      and Officers’ Indemnification55

    Section
      5.18 TPC
      Notes55

     

    ARTICLE
      VI CONDITIONS55

    Section
      6.1 Mutual
      Conditions to the Closing55

    Section
      6.2 ETP’s
      Conditions to the Closing56

    Section
      6.3 CCE’s
      Conditions to the Closing57

     

    ARTICLE
      VII TERMINATION
      AND ABANDONMENT58 

    Section
      7.1 Termination58

    Section
      7.2 Effect
      of
      Termination59

     

    ARTICLE
      VIII SURVIVAL;
      INDEMNIFICATION59 

    Section
      8.1 Survival.59

    Section
      8.2 Indemnification.60

    Section
      8.3 Calculation
      of Damages63

    Section
      8.4 Procedures
      for Third-Party Claims.63

    Section
      8.5 Procedures
      for Inter-Party Claims64

     

    ARTICLE
      IX MISCELLANEOUS
      PROVISIONS64

    Section
      9.1 Interpretation64

    Section
      9.2 Disclosure
      Letters65

     

    -
      ii
-

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Section
      9.3 Payments65

    Section
      9.4 Expenses65

    Section
      9.5 Choice
      of
      Law65

    Section
      9.6 Assignment65

    Section
      9.7 Notices65

    Section
      9.8 Consent
      to Jurisdiction67

    Section
      9.9 No
      Right
      of Setoff67

    Section
      9.10 Time
      is
      of the Essence67

    Section
      9.11 Specific
      Performance67

    Section
      9.12 Entire
      Agreement67

    Section
      9.13 Third
      Party Beneficiaries67

    Section
      9.14 Counterparts68

    Section
      9.15 Severability68

    Section
      9.16 Headings68

    Section
      9.17 Waiver68

    Section
      9.18 Amendment68

     

    EXHIBITS

    A CCE
      Disclosure Letter

    B Terms
      of
      TPC Transition Services Agreement

    C Form
      of
      Second Amended and Restated LLC Agreement

    D Resolutions
      of CCE Executive Committee

     

    

     

    -
      iii
-

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    REDEMPTION
      AGREEMENT

     

    This
      REDEMPTION AGREEMENT, dated as of September 14, 2006 (this “Agreement”),
      is
      made and entered into by and between Energy Transfer Partners, L.P., a Delaware
      limited partnership (“ETP”),
      and
      CCE Holdings, LLC, a Delaware limited liability company (“CCE”).
      

     

    W
      I T N E
      S S E T H:

     

    WHEREAS,
      CCE, through its subsidiaries, owns and operates a network of natural gas
      pipelines and is engaged in the business of the interstate transportation of
      natural gas;

     

    WHEREAS,
      an indirect Subsidiary of CCE owns all of the issued and outstanding membership
      interests of Transwestern Pipeline Company, LLC, a Delaware limited liability
      company (“TPC”);

     

    WHEREAS,
      EFS-PA, LLC, a Delaware limited liability company, CDPQ Investments (U.S.)
      Inc.,
      a Delaware corporation, Lake Bluff Inc., a Delaware corporation, Merrill Lynch
      Ventures, L.P. 2001, a Delaware limited partnership, and Kings Road Holdings
      I
      LLC, a Delaware limited liability company (collectively, the “Other
      CCE Owners”)
      own
      Class B membership interests in CCE that collectively represent 50% of the
      outstanding membership interests in CCE (the “50%
      CCE Interest”);

     

    WHEREAS,
      concurrently with the execution and delivery of this Agreement, ETP has entered
      into a Purchase and Sale Agreement, dated as of September 14, 2006, with the
      Other CCE Owners pursuant to which ETP has agreed, subject to the terms and
      conditions thereof, to purchase the 50% CCE Interest from the Other CCE Owners
      (the “CCE
      Acquisition Agreement”);

     

    WHEREAS,
      subject to the terms and conditions of this Agreement, CCE desires to redeem
      the
      50% CCE Interest that ETP proposes to acquire pursuant to the CCE Acquisition
      Agreement by transferring to ETP all of the membership interests in TPC (the
      “TPC
      Interests”)
      as a
      redemption payment;

     

    WHEREAS,
      in connection with CCE’s redemption of the 50% CCE Interest to be owned by ETP,
      CCE intends to cause (i) CrossCountry Energy, LLC, a Delaware limited liability
      company that is wholly-owned by CCE (“CC
      Energy”),
      or
      one of its affiliates, to borrow from lenders that are not Affiliates of CCE
      an
      amount sufficient to enable CC Energy or such affiliate, after paying expenses
      related to the incurrence of such debt, to contribute to TW Holdings an amount
      necessary to repay all of the outstanding TW Holdings Debt (the “TW
      Debt Payoff Amount”)
      plus
      the Cash Redemption Amount (as defined in Section 1.1 hereof) (the “CC Energy
      Debt Proceeds Amount”),
      (ii)
      CC Energy to contribute the TW Debt Payoff Amount to Transwestern Holding
      Company, LLC, a Delaware limited liability company that is wholly-owned by
      CC
      Energy (“TW
      Holdings”),
      and
      (iii) cause TW Holdings to repay all of its existing debt, in each case prior
      to
      the redemption of the 50% CCE Interest, described in the preceding
      recital;

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    

     

    WHEREAS,
      each of the Boards of Directors or other governing body of each of CCE and
      ETP
      has approved, and deems it advisable and in the best interests of their
      respective shareholders, partners and members to consummate the transactions
      contemplated by, this Agreement upon the terms and subject to the conditions
      set
      forth herein;

     

    NOW,
      THEREFORE, for and in consideration of the foregoing and the representations,
      warranties, covenants and agreements set forth herein, CCE and ETP, intending
      to
      be legally bound hereby, hereby agree as follows:

     

    ARTICLE
      I

    DEFINITIONS

     

    Section
      1.1  Specific
      Definitions.
      For
      purposes of this Agreement, the following terms shall have the meanings set
      forth below:

     

    “Action”
shall
      mean any administrative, regulatory, judicial or other formal proceeding,
      action, Claim, suit, investigation or inquiry by or before any Governmental
      Authority, arbitrator or mediator.

     

    ”Adjustment
      Amount”
shall
      mean $14,400,000.

     

    “Affected
      Employees”
shall
      mean the TPC Employees on the Closing Date, including Transferring Shared
      Service Employees who become TPC Employees on the date immediately prior to
      the
      Closing Date pursuant to the provisions of Section 5.5(g).

     

    “Affiliate”
shall
      have the meaning set forth in Rule 12b-2 of the General Rules and Regulations
      under the Exchange Act. 

     

    “Agreement”
shall
      mean this Redemption Agreement, together with the CCE Disclosure Letter and
      the
      Exhibits hereto, as the same may be amended or supplemented from time to time
      in
      accordance with the provisions hereof.

     

    “Applicable
      Law”
shall
      mean any statute, law, ordinance, executive order, rule or regulation (including
      a regulation that has been formally promulgated in a rule-making proceeding
      but,
      pending final adoption, is in proposed or temporary form having the force of
      law); guideline or notice having the force of law; or approval, permit, license,
      franchise, judgment, order, decree, injunction or writ of any Governmental
      Authority applicable to a specified Person or specified property, as in effect
      from time to time. 

     

    “Auditor”
shall
      have the meaning set forth in Section 2.4(b).

     

    “Base
      Compensation”
shall
      have the meaning set forth in Section 5.5(f).

     

    “Base
      Debt Amount”
shall
      mean $520,000,000.

     

    “Base Pro
      Forma Net Working Capital Amount”
shall
      mean zero dollars.

     

    “Benefit
      Programs or Agreements”
shall
      have the meaning set forth in Section 3.12(b).

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    

     

    “Burdensome
      Condition”
shall
      have the meaning set forth in Section 5.3(b).

     

    “Business
      Day”
shall
      mean a day other than a Saturday, Sunday or other day on which banks located
      in
      New York City are authorized or required by law to close. 

     

    “Cap
      Amount”
shall
      have the meaning set forth in Section 8.2(d).

     

    “Cash
      Flow”
shall
      have the meaning set forth in the
      Second Amended and Restated LLC Agreement, calculated without duplication on
      a
      combined basis for CCE and its Subsidiaries. 

     

    “Cash
      Redemption Amount”
shall
      have the meaning set forth in Section 2.3(d)(iv) hereof.

     

    “Casualty
      Insurance Claims”
shall
      have the meaning set forth in Section 5.9(a).

     

    “CC
      Energy”
shall
      have the meaning set forth in the Recitals to this Agreement.

     

    “CC
      Energy Debt Proceeds Amount”
shall
      have the meaning set forth in the Recitals to this Agreement.

     

    “CCE”
shall
      have the meaning set forth in the Recitals to this Agreement.

     

    “CCEA
      LLC”
shall
      mean CCE Acquisition LLC, a Delaware limited liability company.

     

    “CCEA
      Corp.”
shall
      mean CCEA Corp., a Delaware corporation.

     

    “CCE
      Acquisition”
shall
      mean the acquisition of the 50% CCE Interest from the Other CCE Owners pursuant
      to the terms and conditions of the CCE Acquisition Agreement.

     

    “CCE
      Acquisition Agreement”
shall
      have the meaning set forth in the Recitals to this Agreement.

     

    “CCE
      Adjustment”
shall
      have the meaning set forth in Section 2.4(c).

     

    “CCE
      Annual Financial Statements”
shall
      mean the audited balance sheets at December 31, 2004 and 2005 and the statements
      of income, statements of members’ equity and statements of cash flow of CCE for
      the years ended December 31, 2004 and 2005.

     

    “CCE Cash
      Flow Amount”
shall
      mean the amount of Cash Flow of CCE for the period from the date of the CCE
      Acquisition until the Closing Date (for purposes of this definition of CCE
      Cash
      Flow Amount, the CCE Cash Flow Amount shall be deemed to include without
      duplication the amount of Citrus Corp. cash dividends paid after the Closing
      Date but relating to any portion of the period from the date of the CCE
      Acquisition until the Closing Date; provided, however, that if no dividends
      are
      paid by Citrus Corp. relating to such period, then the CCE Cash Flow Amount
      shall be deemed to include without duplication 50% (i.e., CCE’s share) of Citrus
      Corp. net income for such period). 

     

    “CCE
      Defined Contribution Plan”
      shall
      have the meaning set forth in Section 5.5(i).

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    

     

    “CCE
      Disclosure Letter”
means
      the letter dated September 14, 2006 from CCE to ETP in the form attached as
      Exhibit A to this Agreement.

     

    “CCE
      FAS 106 Report” shall
      mean the Southern
      Union Company Postretirement Medical and Death Benefits for CrossCountry Energy
      Employees Application of Statement of Financial Accounting Standards Nos. 106
      and 132(R) to the Fiscal Year Ending December 31, 2005. 

     

    “CCE
      Financial Statements”
means
      the CCE Annual Financial Statements, the CCE Six Month Interim Financial
      Statements, the CCE Nine Month Interim Financial Statements and the CCE 2006
      Financial Statements.

     

    “CCE
      Flex Plans”
      shall
      have the meaning set forth in Section 5.5(h).

     

    “CCE
      Indemnified Parties”
shall
      have the meaning set forth in Section 8.2(b).

     

    “CCE
      Medicare Eligible SPD” shall
      mean the Summary Plan Description Options PPO Plan for CrossCountry Energy
      (Medicare Eligible Retired Employees). 

     

    “CCE
      Nine Month Interim Financial Statements”
shall
      mean the unaudited balance sheets, statements of income, statements of members’
equity and statements of cash flow for CCE as of, and for the nine months ended,
      September 30, 2005 and 2006.

     

    “CCE
      Six Month Interim Financial Statements”
shall
      mean the unaudited balance sheets, statements of income, statements of members’
equity and statements of cash flow for CCE as of, and for the six months ended,
      June 30, 2005 and 2006.

     

    “CCE
      LLC Agreement”
means
      the Amended and Restated Limited Liability Company Agreement of CCE, dated
      as of
      November 5, 2004, as amended by the First Amendment thereto, dated as of
      December 2, 2004.

     

    “CCE
      Returns”
shall
      have the meaning set forth in Section 5.6(a)(i).

     

    “CCE
      Stub Period Income Statements”
means
      the unaudited income statements for CCE for the three months ended December
      31,
      2005 and for the one month periods ended December 31, 2004 and
      2005.

     

    “CCE
      S-X Financial Statements”
shall
      mean the CCE Financial Statements, as modified pursuant to the provisions of
      Section 5.13(b).

     

    “CCE
      Under Age 65 SPD” shall
      mean the Summary Plan Description Options PPO Plan for CrossCountry Energy
      (Retired Employees under age 65).

     

    “CCE
      2006 Financial Statements”
shall
      mean the audited balance sheet, statement of income, statement of members’
equity and statement of cash flow of CCE as of, and for the year ended, December
      31, 2006.

     

    “CCES”
shall
      mean CrossCountry Energy Services, LLC.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    

     

    “Citrus”
shall
      mean CrossCountry Citrus, LLC, a Delaware limited liability
      company.

     

    “Citrus
      S-X Financial Statements”
shall
      mean the Citrus Financial Statements, as modified pursuant to the provisions
      of
      Section 5.13(b).

     

    “Citrus
      2006 Financial Statements”
shall
      mean the audited balance sheet, statement of income, statement of member’s
      equity and statement of cash flow of Citrus as of, and for the year ended,
      December 31, 2006.

     

    “Citrus
      Annual Financial Statements”
shall
      mean the audited balance sheets at December 31, 2004 and 2005 and the statements
      of income, statements of member’s equity and statements of cash flow of Citrus
      for the years ended December 31, 2004 and 2005.

     

    “Citrus
      Financial Statements”
means
      the Citrus Annual Financial Statements, the Citrus Six Month Interim Financial
      Statements, the Citrus Nine Month Interim Financial Statements, and the Citrus
      2006 Financial Statements.

     

    “Citrus
      Nine Month Interim Financial Statements”
shall
      mean the unaudited balance sheets, statements of income, statements of member’s
      equity and statements of cash flow for Citrus as of, and for the nine months
      ended, September 30, 2005 and 2006.

     

    “Citrus
      Six Month Interim Financial Statements”
shall
      mean the unaudited balance sheets, statements of income, statements of member’s
      equity and statements of cash flow for Citrus as of, and for the six months
      ended, June 30, 2005 and 2006.

     

    “Citrus
      Stub Period Income Statements”
means
      the unaudited income statements for Citrus for the three months ended December
      31, 2005 and for the one month periods ended December 31, 2004 and
      2005.

     

    “Claims”
shall
      mean any and all claims, lawsuits, demands, causes of action, investigations
      and
      other proceedings (whether or not before a Governmental Authority).

     

    “Closing
      Adjustment Amount”
shall
      have the meaning set forth in Section 2.3(c).

     

    “Closing
      Balance Sheet”
shall
      have the meaning set forth in Section 2.4(a).

     

    “Closing
      Date”
shall
      have the meaning set forth in Section 2.2.

     

    “Closing”
shall
      have the meaning set forth in Section 2.2.

     

    “Code”
shall
      mean the Internal Revenue Code of 1986, as amended.

     

    “Confidentiality
      Agreement”
shall
      mean the confidentiality agreement entered into by and between ETP and Southern
      Union, dated July 25, 2006.

     

    “Consolidated
      Income Tax Return”
shall
      have the meaning set forth in Section 5.6(a)(ix) hereof.

     

    “Continuation
      Period”
shall
      have the meaning set forth in Section 5.5(f).

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    

     

    “Damages”
shall
      mean all demands, Claims, causes of action, suits, judgments, damages, amounts
      paid in settlement (with the approval of the Indemnifying Party where
      applicable), penalties, Liabilities, losses or deficiencies, costs and expenses,
      including reasonable attorney’s fees, court costs, expenses of arbitration or
      mediation, and other out-of-pocket expenses incurred in investigating or
      preparing the foregoing. “Damages” does not include incidental, indirect or
      consequential damages, damages for lost profits or other special damages or
      punitive or exemplary damages; provided, however, that in the case of
      Third-Party Claims, “Damages” shall be deemed to include all forms of relief,
      monetary and otherwise, asserted therein, without any of the foregoing
      exceptions. 

     

    “Determination
      Date”
shall
      have the meaning set forth in Section 2.4(b).

     

    “Employee
      Benefit Plans”
shall
      have the meaning set forth in Section 3.12(b).

     

    “Encumbrances”
shall
      mean any Claims, Liens, conditional and installment sale agreements or other
      title retention agreements, activity and use limitations, easements, deed
      restrictions, title defects, reservations, encumbrances and charges of any
      kind,
      options, subordination agreements or adverse claim of any kind.

     

    “Enron
      Inactive Medical Plan” shall
      mean the Enron Corp. Medical Plan for Inactive Participants. 

     

    “Enron
      Plan”
shall
      mean any “employee benefit plan,” as defined in Section 3(3) of ERISA, or any
      policy, plan, agreement or arrangement providing for employment terms, change
      in
      control benefits, severance benefits, retention benefits, insurance coverage
      (including any self-insured arrangements), workers’ compensation, disability
      benefits, supplemental unemployment benefits, vacation benefits, retirement
      benefits, deferred compensation, profit-sharing, bonuses, or other forms of
      incentive compensation, or post-retirement insurance, compensation or benefits
      (whether or not an ERISA plan) entered into, sponsored, maintained, or
      contributed to by Enron Corp. or any of its ERISA Affiliates, current or former,
      specifically including the Enron Corp. Cash Balance Plan (formerly the Enron
      Corp. Retirement Plan), the Enron Corp. Savings Plan (formerly the Enron Corp.
      Savings Plan and Enron Corp. Employee Stock Ownership Plan, which were merged
      in
      August 2002), the Enron Prisma Energy Savings Plan, the Portland General
      Electric Company Pension Plan and the Enron Inactive Medical Plan.  

     

    “Enron
      VEBA”
shall
      mean the Enron Gas Pipelines Employee Benefit Trust, as it may be amended,
      which
      as of the date of this Agreement, is the subject of the Enron VEBA
      Motion.

     

    “Enron
      VEBA Motion”
shall
      mean the Amended and Restated Motion of Enron Corp., et al, for an Order
      Pursuant to Sections 105 and 363 of the Bankruptcy Code, Authorizing Termination
      of Employee Benefits Trust and Distribution of Trust Assets, dated June 17,
      2005, as it may be amended, which motion is currently pending in the United
      States Bankruptcy Court for the Southern District of New York.

     

    “Environmental
      Claim”
means
      any claim, loss, cost, expense, liability, penalty or Damages arising, incurred
      or otherwise asserted pursuant to any Environmental Law.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    

     

    “Environmental
      Laws”
shall
      mean all foreign, federal, state and local laws, regulations, rules and
      ordinances relating to pollution or protection of human health or the
      environment, including laws relating to releases or threatened releases of
      Hazardous Substances into the environment (including ambient air, surface water,
      groundwater, land, surface and subsurface strata). 

     

    “Environmental
      Permit”
shall
      mean any Permit, formal exemption, identification number or other authorization
      issued by a Governmental Authority pursuant to an applicable Environmental
      Law.

     

    “ERISA”
shall
      mean the Employee Retirement Income Security Act of 1974, as amended, and the
      regulations promulgated thereunder.

     

    “ERISA
      Affiliate”
shall
      mean, with respect to any Person, any corporation, trade, business, or entity
      under common control with such Person, within the meaning of Section 414(b),
      (c)
      or (m) of the Code or Section 4001 of ERISA.

     

    “ERISA
      Plans”
shall
      have the meaning set forth in Section 3.12(a).

     

    “Estimated
      SUG Expansion Project Expenses”
shall
      have the meaning set forth in Section 2.3(a).

     

    “ETP”
shall
      have the meaning set forth in the recitals to this Agreement.

     

    “ETP
      401(k) Plan”
      shall
      have the meaning set forth in Section 5.5(i).

     

    “ETP
      Adjustment”
shall
      have the meaning set forth in Section 2.4(c).

     

    “ETP
      Indemnified Parties”
shall
      have the meaning set forth in Section 8.2(a).

     

    “ETP
      Plans”
shall
      have the meaning set forth in Section 5.5(c).

     

    “Exchange
      Act”
shall
      mean the Securities Exchange Act of 1934, as amended, and the Regulations
      promulgated thereunder.

     

    “Existing
      TPC Debt”
shall
      mean the existing indebtedness of TPC pursuant to (x) those certain $270,000,000
      5.39% Senior Unsecured Notes due November 17, 2014 and $250,000,000 5.54% Senior
      Unsecured Notes due November 17, 2016 and (y) that certain $230,000,000 Amended
      and Restated Credit Agreement dated as of December 21, 2005 among TPC and the
      Lenders, Administrative Agent and Issuing Bank, Syndication Agent,
      Co-Documentation Agents and Arrangers parties thereto.

     

    “Existing
      TW Holdings Debt”
shall
      mean the existing indebtedness of TW Holdings pursuant to (x) those certain
      $125,000,000 5.64% Senior Unsecured Notes due November 17, 2014, and
      $100,000,000 5.79% Senior Unsecured Notes due November 17, 2016, and (y) that
      certain $230,000,000 Amended and Restated Credit Agreement among TW Holdings,
      CrossCountry Citrus, LLC, as guarantor, and the Lenders, Administrative Agent,
      Syndication Agent, Co-Documentation Agents, and Arrangers parties
      thereto.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    

     

    “FCC”
means
      the Federal Communication Commission.

     

    “FERC”
shall
      mean the Federal Energy Regulatory Commission including any individual office
      or
      department within FERC.

     

    “For
      Cause”
shall
      have the meaning set forth in Section 5.5(f).

     

    “GAAP”
shall
      mean United States generally accepted accounting principles as in effect from
      time to time, applied on a consistent basis.

     

    “Governmental
      Authority”
shall
      mean any executive, legislative, judicial, tribal, regulatory, taxing or
      administrative agency, body, commission, department, board, court, tribunal,
      arbitrating body or authority of the United States or any foreign country,
      or
      any state, local or other governmental subdivision thereof. 

     

    “Hazardous
      Substances”
shall
      mean any chemicals, materials or substances defined as or included in the
      definition of “hazardous substances”, “hazardous wastes”, “hazardous materials”,
“hazardous constituents”, “restricted hazardous materials”, “extremely hazardous
      substances”, “toxic substances”, “contaminants”, “pollutants”, “toxic
      pollutants”, or words of similar meaning and regulatory effect under any
      applicable Environmental Law. 

     

    “HSR
      Act”
means
      the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the
      rules and regulations promulgated thereunder.

     

    “Indemnified
      Party”
shall
      have the meaning set forth in Section 8.2(c).

     

    “Indemnifying
      Party”
shall
      have the meaning set forth in Section 8.2(c).

     

    “Initial
      Termination Date”
shall
      have the meaning set forth in Section 7.1(b).

     

    “Insurance
      Policies”
shall
      have the meaning set forth in Section 3.21(a).

     

    “IRS”
shall
      mean the Internal Revenue Service.

     

    “June
      30 TPC Expansion Project Expenses”
shall
      mean $7,750,000.

     

    “Knowledge”
shall
      mean, as to CCE, the actual knowledge, after due inquiry, of the persons listed
      on Section 1.1(a) of the CCE Disclosure Letter, or any Person who replaces
      any
      of such listed persons between the date of this Agreement and the Closing Date.
      

     

    “Liabilities”
shall
      mean any and all debts, liabilities, commitments and obligations, whether or
      not
      fixed, contingent or absolute, matured or unmatured, liquidated or unliquidated,
      accrued or unaccrued, known or unknown, whether or not required by GAAP to
      be
      reflected in financial statements or disclosed in the notes thereto.

     

    “Liens”
shall
      mean any lien, mortgage, pledge, charge, claim, assignment by way of security
      or
      similar security interest.

     

    “LIBOR”
shall
      mean the London Interbank Offer Rate.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    

     

    “Make-Whole
      Amount”
shall
      have the meaning set forth in the TW Holdings Note Purchase
      Agreement.

     

    “Material
      Adverse Effect”
shall
      mean any change or effect that is materially adverse to the business, financial
      condition or assets of the business of TPC; provided, however, that Material
      Adverse Effect shall exclude any change or effect due to (a) the negotiation,
      execution, announcement and consummation of this Agreement and the transactions
      contemplated hereby, including the impact thereof on relationships, contractual
      or otherwise, with customers, suppliers, distributors, partners, joint owners
      or
      venturers, or employees, (b) any action taken by CCE, ETP or any of their
      respective representatives or Affiliates or other action required or permitted
      by the terms of this Agreement or necessary to consummate the transactions
      contemplated by this Agreement, (c) the general state of the industries in
      which
      TPC operates (including (i) pricing levels, (ii) changes in the international,
      national, regional or local wholesale or retail markets for natural gas, (iii)
      changes in the North American, national, regional or local interstate natural
      gas pipeline systems, and (iv) rules, regulations or decisions of the FERC
      or
      the courts affecting the interstate natural gas transmission industry as a
      whole, or rate orders, motions, complaints or other actions affecting TPC),
      except, in all cases for such effects which disproportionately impact TPC,
      (d)
      general legal, regulatory, political, business, economic, capital market and
      financial market conditions (including prevailing interest rate levels), or
      conditions otherwise generally affecting the industries in which TPC operates,
      except, in all cases, for such effects which disproportionately impact TPC
      and
      (e) any condition set forth in the CCE Disclosure Letter (but only to the extent
      set forth therein).

     

    “Material
      Contract”
shall
      have the meaning set forth in Section 3.7(a).

     

    “Minimum
      Claim Amount”
shall
      have the meaning set forth in Section 8.2(d).

     

    “Net
      Working Capital Amount”
as
      of a
      particular date shall mean (a) the current assets of TPC as of such date minus
      (b) the current liabilities of TPC as of such date, with both current assets
      and
      current liabilities determined in accordance with GAAP, applied in a manner
      consistent with the preparation of the Pro Forma Adjusted Balance Sheet (subject
      to the exceptions from GAAP relating to the adjustments reflected on the Pro
      Forma Adjusted Balance Sheet).

     

    “NGA”
shall
      have the meaning set forth in Section 3.22.

     

    “NGPA”
shall
      have the meaning set forth in Section 3.22.

     

    “Organizational
      Documents”
shall
      mean certificates of incorporation, by-laws, certificates of formation, limited
      liability company operating agreements, partnership or limited partnership
      agreements or other formation or governing documents of a particular entity.
      

     

    “Other
      CCE Owners”
shall
      have the meaning set forth in the Recitals of this Agreement.

     

    “PBGC”
shall
      mean the Pension Benefit Guaranty Corporation.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    

     

    “PEPL”
shall
      mean Panhandle Eastern Pipe Line Company, LP, a Delaware limited
      partnership.

     

    “Permitted
      Encumbrances”
shall
      mean (a) zoning, planning and building codes and other applicable laws
      regulating the use, development and occupancy of real property and permits,
      consents and rules under such laws; (b) encumbrances, easements, rights-of-way,
      covenants, conditions, restrictions and other matters affecting title to real
      property (other than Liens) which do not materially detract from the value
      of
      such real property or materially restrict the use of such real property; (c)
      leases and subleases of real property; (d) all easements, encumbrances or other
      matters that are necessary for utilities and other similar services on real
      property; (e) Liens to secure indebtedness reflected on the TPC Financial
      Statements, (f) Liens to secure indebtedness incurred after the date thereof,
      to
      the extent permitted pursuant to Section 5.1(b)(xii), (g) Liens for Taxes and
      other governmental levies not yet due and payable or, if due, (i) not delinquent
      or (ii) being contested in good faith by appropriate proceedings during which
      collection or enforcement against the property is stayed and with respect to
      which adequate reserves have been established on the books of TPC and are being
      maintained to the extent required by GAAP, (h) mechanics’, workmen’s,
      repairmen’s, materialmen’s, warehousemen’s, carriers’ or other similar Liens,
      including all statutory Liens, arising or incurred in the ordinary course of
      business; (i) original purchase price conditional sales contracts and equipment
      leases with third parties entered into in the ordinary course of business,
      (j)
      Liens that do not materially interfere with or materially affect the value
      or
      use of the respective underlying asset to which such Liens relate, (k)
      Encumbrances that are capable of being cured through condemnation procedures
      under the NGA at a total cost to TPC of less than $1,000,000 and (l)
      Encumbrances that are reflected in any Material Contract.

     

    “Person”
shall
      mean any natural person, corporation, company, general partnership, limited
      partnership, limited liability partnership, joint venture, proprietorship,
      limited liability company, or other entity or business organization or vehicle,
      trust, unincorporated organization or Governmental Authority or any department
      or agency thereof. 

     

    “Post-Closing
      Adjustment Amount”
shall
      have the meaning set forth in Section 2.4(a).

     

    “Post-Closing
      Taxes”
shall
      have the meaning set forth in Section 5.6(a)(iv).

     

    “Pre-Closing
      Taxes”
shall
      have the meaning set forth in Section 5.6(a)(iv).

     

    “Pro
      Forma Adjusted Balance Sheet”
shall
      mean the pro forma balance sheet of TPC as of June 30, 2006 derived from the
      TPC
      Interim Balance Sheet, adjusted to:

     

    (a) reflect,
      among the other matters reflected in the adjustments set forth in Section 1.1(b)
      of the CCE Disclosure Letter, that current liabilities shall exclude short
      term
      debt and current portions of long term debt; and

     

    (b) reflect
      as a reduction in cash the payment of a $22,000,000 cash distribution to the
      sole member of TPC to be made prior to the Closing.

     

    The
      Pro
      Forma Adjusted Balance Sheet, reflecting the adjustments listed above, is set
      forth in Section 1.1(b) of the CCE Disclosure Letter.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    

     

    “Real
      Property”
shall
      have the meaning set forth in Section 3.11.

     

    “Regulation”
shall
      mean any rule or regulation of any Governmental Authority having the effect
      of
      Law or of any rule or regulation of any self-regulatory organization, such
      as
      the New York Stock Exchange.

     

    “Release”
means
      any depositing, spilling, leaking, pumping, pouring, placing, emitting,
      discarding, abandoning, emptying, discharging, migrating, injecting, escaping,
      leaching, dumping, or disposing.

     

    “Rights-Of-Way”
shall
      have the meaning set forth in Section 3.11.

     

    “Sarbanes-Oxley
      Act”
means
      the Sarbanes-Oxley Act of 2002 and the Regulations promulgated
      thereunder.

     

    “SEC”
means
      the Securities and Exchange Commission.

     

    “Second
      Amended and Restated LLC Agreement”
shall
      mean that certain Second Amended and Restated Limited Liability Company
      Agreement of CCE, in the form attached hereto as Exhibit
      D
      to be
      entered into by and among ETP, CCEA LLC and CCEA Corp. as of the date of the
      CCE
      Acquisition.

     

    “Securities
      Act”
shall
      mean the Securities Act of 1933, as amended, and the Regulations promulgated
      thereunder.

     

    “Severance
      Benefits”
shall
      have the meaning set forth in Section 5.5(f).

     

    “Shared
      Service Employees”
shall
      have the meaning set forth in Section 5.5(g).

     

    “Southern
      Union”
shall
      mean Southern Union Company, a Delaware corporation.

     

    “Straddle
      Period”
shall
      have the meaning set forth in Section 5.6(a)(ii).

     

    “Straddle
      Period Return(s)”
shall
      have the meaning set forth in Section 5.6(a)(ii).

     

    “Straddle
      Statement”
shall
      have the meaning set forth in Section 5.6(a)(ii).

     

    “Subsidiary”
of
      any
      entity means, at any date, any Person (a) the accounts of which would be
      consolidated with and into those of the applicable entity in such entity’s
      consolidated financial statements if such financial statements were prepared
      in
      accordance with GAAP as of such date or (b) of which securities or other
      ownership interests representing more than fifty percent (50%) of the equity
      or
      more than fifty percent (50%) of the ordinary voting power or, in the case
      of a
      partnership, more than fifty percent (50%) of the general partnership interests
      or more than fifty percent (50%) of the profits or losses of which are, as
      of
      such date, owned, controlled or held by the applicable entity or one or more
      subsidiaries of such entity. 

     

    “SUG
      Expansion Project Expenses”
shall
      mean all expenditures incurred at any time prior to the Closing Date by
      Affiliates of TPC (other than TPC), including Southern Union, 

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    Valley
      Pipeline Company, LP and PEPL, in connection with the TPC Expansion Projects
      that have not been reimbursed by TPC on or prior to the Closing
      Date.

     

    “Survival
      Period”
shall
      have the meaning set forth in Section 8.1(c).

     

    “Tax
      Claim”
shall
      have the meaning set forth in Section 5.6(d)(i).

     

    “Tax
      Indemnified Party”
shall
      have the meaning set forth in Section 5.6(d)(i).

     

    “Tax
      Indemnifying Party”
shall
      have the meaning set forth in Section 5.6(d)(i).

     

    “Tax
      Return”
shall
      mean any report, return, declaration, or other information required to be
      supplied to a Governmental Authority in connection with Taxes including any
      claim for refund or amended return.

     

    “Taxes”
shall
      mean all taxes, levies or other like assessments, including net income, gross
      income, gross receipts, capital gains, profits, environmental, excise, value
      added, ad valorem, real or personal property, withholding, asset, sales, use,
      transfer, registration, license, payroll, transaction, capital, business,
      occupation, corporation, employment, withholding, wage, net worth, franchise,
      minimum, alternative minimum, and estimated taxes, or other governmental taxes
      imposed by or payable to any foreign, Federal, state or local taxing authority,
      whether computed on a separate, consolidated, unitary, combined or any other
      basis; and in each instance such term shall include any interest, penalties
      or
      additions to tax attributable to any such Tax. 

     

    “Third-Party
      Claim”
shall
      have the meaning set forth in Section 8.4(a).

     

    “Threshold
      Amount”
shall
      have the meaning set forth in Section 8.2(d).

     

    “Total
      Debt”
shall
      mean all short-term and long-term indebtedness of TPC as reflected on its
      balance sheet, prepared in accordance with GAAP, of TPC as of a particular
      date.

     

    “TPC”
shall
      have the meaning set forth in the Recitals of this Agreement.

     

    “TPC
      2006 Financial Statements”
shall
      mean the audited balance sheet, statement of income, statement of members’
equity and statement of cash flow of TPC as of, and for the period ended,
      December 31, 2006.

     

    “TPC
      Annual Financial Statements”
shall
      mean the audited balance sheets at December 31, 2004 and 2005 and the statements
      of income, statements of members’ interests and statements of cash flow for the
      years ended December 31, 2004 and 2005, in each case for TPC.

     

    “TPC
      Cash Flow Amount”
shall
      mean the amount of cash flow of TPC included in the CCE Cash Flow Amount for
      the
      period from the date of the CCE Acquisition until the Closing Date.

     

    “TPC
      Employees”
shall
      mean all employees employed by TPC, including employees absent due to vacation,
      illness or similar circumstance, workers’ compensation, short-term 

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

    disability,
      military leave, maternity leave or paternity leave, leave under the Family
      and
      Medical Leave Act of 1993 and other approved leaves of absence from active
      employment. When the term “TPC Employees” is used herein in reference to a
      specific date, “TPC Employees” shall include the employees of TPC referenced in
      the preceding sentence as of such date.

     

    “TPC
      Expansion Project Expenses”
shall
      mean all expenditures incurred at any time prior to the Closing Date (including
      amounts properly accrued in accordance with GAAP and included on the Closing
      Balance Sheet) by TPC in connection with the TPC Expansion Projects, including
      reimbursed SUG Expansion Project Expenses.

     

    “TPC
      Expansion Projects”
shall
      mean the Phoenix and San Juan expansion projects as approved by the Executive
      Committee of CCE by written consent on September 14, 2006.

     

    “TPC
      Financial Statements”
shall
      mean the TPC Annual Financial Statements, the TPC Six Month Interim Financial
      Statements, the TPC Nine Month Interim Financial Statements and the TPC 2006
      Financial Statements.

     

    “TPC
      Interests”
shall
      have the meaning set forth in the Recitals of this Agreement.

     

    “TPC
      Interests Assignment”
means
      the assignment of the TPC Interests in a form to be agreed to by ETP and CCE
      prior to the Closing Date.

     

    “TPC
      Interim Balance Sheet”
shall
      mean the balance sheet as of June 30, 2006 included in the TPC Six Month Interim
      Financial Statements.

     

    “TPC
      Marks”
shall
      have the meaning set forth in Section 5.12.

     

    “TPC
      Nine Month Interim Financial Statements”
shall
      mean the unaudited balance sheets, statements of income, statements of members’
equity and statements of cash flow of TPC as of, and for the nine months ended,
      September 30, 2005 and 2006.

     

    “TPC
      Note Purchase Agreement”
shall
      mean the note purchase agreement, dated as of November 17, 2004, between TPC
      and
      the note purchasers listed therein.

     

    “TPC
      Permits”
shall
      have the meaning set forth in Section 3.9.

     

    “TPC
      Rate Case”
shall
      mean the Natural Gas Act Section 4 rate case which TPC is required to file
      pursuant to the terms and conditions of TPC’s rate settlement in FERC Docket
      Nos. RP95-271, et
      al.,
      together with any proceeding consolidated with or ancillary
      thereto.

     

    “TPC
      Severance Plan” shall
      mean the Transwestern Pipeline Company Severance Pay Plan.

     

    “TPC
      S-X Financial Statements”
shall
      mean the TPC Financial Statements, as modified pursuant to the provisions of
      Section 5.13(b).

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    

     

    “TPC
      Six Month Interim Financial Statements”
shall
      mean the unaudited balance sheets, statements of income, statements of members’
equity and statements of cash flow of TPC as of, and for the six months ended,
      June 30, 2005 and 2006.

     

    “TPC
      Stub Period Income Statements”
means
      the unaudited income statements for TPC for the three months ended December
      31,
      2005 and for the one month periods ended December 31, 2004 and
      2005.

     

    “TPC
      Transition Services Agreement”
shall
      mean a Transition Services Agreement to be agreed to by CCE, PEPL and ETP prior
      to the Closing Date, which shall include the terms and conditions set forth
      on
Exhibit
      B
      to this
      Agreement.

     

    “TPC
      VEBA”
shall
      mean the Transwestern Pipeline Company, LLC VEBA to Provide for Retiree Health
      Care and Other Benefits.

     

    “Transfer
      Tax(es)”
shall
      have the meaning set forth in Section 5.6(e).

     

    “Transferring
      Shared Service Employees”
shall
      have the meaning set forth in Section 5.5(g).

     

    “Treasury
      Regulation”
shall
      mean the income Tax regulations, including temporary and proposed regulations,
      promulgated under the Code, as amended.

     

    “TW
      Holdings”
shall
      have the meaning set forth in the Recitals of this Agreement.

     

    “TW
      Holdings Note Purchase Agreement”
shall
      mean the Note Purchase Agreement, dated November 17, 2004, among TW Holdings
      and
      the note purchasers named therein. 

     

    “50%
      CCE Interest”
shall
      have the meaning set forth in the Recitals of this Agreement.

     

    “50%
      CCE Interest Assignment”
means
      the assignment of the 50% CCE Interest in a form to be agreed to by ETP and
      CCE
      prior to the Closing Date.

     

    ARTICLE
      II

    REDEMPTION
      OF 50% CCE INTEREST

     

    Section
      2.1  Agreement
      to Redeem 50% CCE Interest.
      Subject
      to the terms and conditions of this Agreement, at the Closing, (i) CCE shall
      cause TW Holdings to convey, assign, transfer and deliver to ETP the TPC
      Interests, free and clear of all Encumbrances, and (ii) ETP shall convey,
      assign, transfer and deliver to CCE the 50% CCE Interest. At the Closing, if
      the
      Cash Redemption Amount is positive, CCE shall pay to ETP the Cash Redemption
      Amount by wire transfer of immediately available funds to an account designated
      in writing by ETP or, in the event that the Cash Redemption Amount is negative,
      then ETP shall pay to CCE the absolute value of the Cash Redemption Amount
      by
      wire transfer of immediately available funds to an account designated in writing
      by CCE.

     

    Section
      2.2  Time
      and
      Place of Closing. Upon the terms and subject to the satisfaction of the
      conditions contained in this Agreement, the closing of the transactions
      contemplated by this
      Agreement (the “Closing”)
      shall
      take place at the offices of Vinson & Elkins L.L.P., 1001 Fannin Street,
      2300 First City Tower, Houston, Texas, at 10:00 a.m., local time, on the next
      Business Day that is both the first Business Day of a calendar month and at
      least five (5) Business Days after the date on which all of the conditions
      to
      the Closing specified in Article VI hereof (other than the deliveries specified
      in Section 2.5 and Section 2.6, which deliveries shall be made at the Closing)
      have been satisfied or waived, or at such other place or time as ETP and CCE
      may
      mutually agree in writing. The Closing shall be effective as of 12:01 a.m.
      The
      date and time at which the Closing actually occurs is hereinafter referred
      to as
      the “Closing
      Date.”

     

    Section
      2.3  Pre-Closing
      Matters.

     

    (a)  At
      least
      three (3) Business Days prior to the Closing Date, CCE shall deliver to ETP
      its
      good faith estimate of the amount of the SUG Expansion Project Expenses (the
      “Estimated
      SUG Expansion Project Expenses”),
      together with reasonably detailed support for such estimate.

     

    (b)  CCE
      shall
      deliver to ETP its calculations of the Closing Adjustment Amount (as defined
      in
      Section 2.3(c)) within three (3) Business Days prior to the Closing Date and
      shall provide, upon reasonable advance notice, ETP and ETP’s accountants prompt
      and full reasonable access during normal business hours to the personnel,
      accountants and books and records of CCE, to the extent reasonably related
      to
      the preparation of the Closing Adjustment Amount (and the elements of such
      calculation). ETP and CCE shall in good faith attempt to resolve any objections
      of ETP to such calculation of the Closing Adjustment Amount; if ETP and CCE
      are
      in disagreement with respect to the calculation of the Closing Adjustment Amount
      as of the Closing Date, the Closing Adjustment Amount delivered by CCE to ETP
      pursuant to this Section 2.3, as adjusted to reflect any changes to the Closing
      Adjustment Amount agreed to by the parties, prior to the Closing Date shall
      be
      utilized for purposes of determining the Cash Redemption Amount payable at
      the
      Closing.

     

    (c)  The
      “Closing
      Adjustment Amount”
shall
      mean an amount equal to (i) the Estimated SUG Expansion Project Expenses plus
      (ii) 50% of the June 30 TPC Expansion Project Expenses plus (iii) 50% of the
      Make-Whole Amount actually paid by TW Holdings pursuant to the TW Holdings
      Note
      Purchase Agreement plus (iv) the Adjustment Amount.

     

    (d)  Prior
      to
      the Closing Date, CCE shall cause (i) CC Energy or one of its affiliates (such
      entity to be reasonably determined by CCE) to incur debt in an amount equal
      to
      the CC Energy Debt Proceeds Amount plus the amount necessary for the payment
      of
      expenses related to the incurrence of such debt, (ii) CC Energy to contribute
      to
      TW Holdings the CC Energy Debt Proceeds Amount, (iii) TW Holdings to repay
      all
      of the outstanding TW Holdings Debt, (iv) CC Energy to distribute to CCE an
      amount equal to $30,000,000 (Thirty Million Dollars) less
      the
      Closing Adjustment Amount (the difference between $30,000,000 (Thirty Million
      Dollars) and the Closing Adjustment Amount is referred to herein as the
“Cash
      Redemption Amount”),
      (v)
      TW Holdings to distribute the TPC Interests to CC Energy, and (vi) CC Energy
      to
      distribute the TPC Interests to CCE.

     

    Section
      2.4  Post-Closing
      Adjustment. 

     

    (a)  No
      later
      than 60 days after the Closing Date, CCE shall prepare and deliver to ETP (i)
      a
      balance sheet of TPC as of the close of business on the date immediately prior
      to the Closing Date (the “Closing
      Balance Sheet”),
      and
      (ii) a calculation of the “Post-Closing
      Adjustment Amount,”
which
      shall mean the amount equal to (w) 50% of the difference obtained by subtracting
      (A) the sum of the Base Pro Forma Net Working Capital Amount, the Total Debt
      as
      of the Closing Date, and the June 30 TPC Expansion Project Expenses from (B)
      the
      sum of the Net Working Capital Amount as of the Closing Date, as reflected
      on
      the Closing Balance Sheet, the Base Debt Amount, and the TPC Expansion Project
      Expenses, calculated as of the Closing Date, minus (x) 50% of the difference
      obtained by subtracting the TPC Cash Flow Amount from the CCE Cash Flow Amount
      plus (y) the SUG Expansion Project Expenses as of the Closing Date minus (z)
      the
      Estimated SUG Expansion Project Expenses, which calculation may result in an
      amount that is positive or negative (together with reasonable back-up
      information providing the basis for such balance sheet and other calculations).
      In order for CCE to prepare the Closing Balance Sheet and calculate the
      Post-Closing Adjustment Amount, ETP will provide to CCE and CCE’s accountants
      prompt and full access to the personnel, accountants and books and records
      of
      TPC (and shall provide copies of the applicable portions of such books and
      records as may be reasonably requested), to the extent reasonably related to
      the
      preparation of the Closing Balance Sheet and the calculation of the Post-Closing
      Adjustment Amount (and the elements of such calculation). In order for ETP
      to
      review the Closing Balance Sheet and the calculation of the Post-Closing
      Adjustment Amount, CCE will provide to ETP and ETP’s accountants prompt and full
      access to the personnel, accountants and books and records of CCE and its
      Subsidiaries used by CCE (and shall provide copies of the applicable portions
      of
      such books and records as may be reasonably requested), to the extent reasonably
      related to the preparation of the Closing Balance Sheet and the calculation
      of
      the Post-Closing Adjustment Amount (and the elements of such calculation).
      The
      Closing Balance Sheet and the calculation of the Post-Closing Adjustment Amount
      relating to TPC shall be prepared in a manner consistent with the preparation
      of
      the Pro Forma Adjusted Balance Sheet (subject to, in the case of the Closing
      Balance Sheet, the exceptions from GAAP relating to the adjustments reflected
      on
      the Pro Forma Adjusted Balance Sheet).

     

    (b)  Disputes.
      If ETP
      disagrees with the calculation of the Post-Closing Adjustment Amount, it shall
      notify CCE of such disagreement in writing within thirty (30) days after its
      receipt of the last item to be received by ETP pursuant to the first sentence
      of
      Section 2.4(a), which notice shall set forth in detail the particulars of such
      disagreement. In the event that ETP does not provide such a notice of
      disagreement within such thirty (30) day period, ETP shall be deemed to have
      accepted the Closing Balance Sheet and the calculation of the Post-Closing
      Adjustment Amount (and each element of such calculation) delivered by CCE,
      which
      shall be final, binding and conclusive for all purposes hereunder. In the event
      any such notice of disagreement is timely provided by ETP, then ETP and CCE
      shall use their commercially reasonable efforts for a period of thirty (30)
      days
      (or such longer period as they may mutually agree) to resolve any disagreements
      with respect to the calculation of the Post-Closing Adjustment Amount (or any
      element thereof). If, at the end of such period, they are unable to resolve
      such
      disagreements, then, upon the written request of either party, an independent
      accounting firm (not providing services to ETP or CCE) acceptable to ETP and
      CCE
      (the “Auditor”)
      shall
      resolve any remaining disagreements. The Auditor shall determine as promptly
      as
      practicable (but in any event within sixty (60) days) following the date on
      which such dispute is referred to the Auditor, based solely on written
      submissions, which shall be forwarded by ETP and CCE to the Auditor within
      thirty (30) days following the Auditor’s selection, whether the Closing Balance
      Sheet was prepared in accordance with the standards set forth in this Section
      2.4 with respect to any items identified as disputed in the notice of
      disagreement and not previously resolved by ETP and CCE, and if not, whether
      and
      to what extent (if any) the Post-Closing Adjustment Amount (or any element
      thereof) requires adjustment. Each party shall bear its own expenses and the
      fees and expenses of its own representatives and experts in connection with
      the
      preparation, review, dispute (if any) and final determination of the Closing
      Balance Sheet and the Post-Closing Adjustment Amount. The parties shall share
      the costs, expenses and fees of the Auditor in inverse proportion to the extent
      to which their respective positions are sustained (e.g., if CCE’s position is
      one hundred percent (100%) sustained, it shall bear none of such costs,
      expenses, and fees of the Auditor). The determination of the Auditor shall
      be
      final, conclusive and binding on the parties. The Auditor’s determination of the
      amount of the Post-Closing Adjustment Amount shall then be deemed to be the
      Post-Closing Adjustment Amount for purposes of this Section 2.4. The date on
      which such items are accepted or finally determined in accordance with this
      Section 2.4 is referred as to the “Determination
      Date.”
As
      used in this Agreement, the term “commercially reasonable efforts” shall not
      include efforts which require the performing party (i) to do any act that is
      unreasonable under the circumstances, (ii) to make any capital contribution
      not
      expressly contemplated hereunder, (iii) to amend or waive any rights under
      this
      Agreement, or (iv) to incur or expend any funds other than reasonable
      out-of-pocket expenses incurred in satisfying its obligations hereunder,
      including the reasonable fees, expenses and disbursements of accountants,
      counsel and other professionals.

     

    (c)  ETP
      and CCE Adjustments.
      If the
      Post-Closing Adjustment Amount is positive, then ETP shall pay to CCE an amount
      equal to the Post-Closing Adjustment Amount (the “ETP
      Adjustment”),
      and
      if the Post-Closing Adjustment Amount is negative, then CCE shall pay to ETP
      an
      amount equal to the absolute value of the Post-Closing Adjustment Amount (the
      “CCE
      Adjustment”).
      The
      CCE Adjustment, if any, and the ETP Adjustment, if any, shall bear simple
      interest at a rate equal to daily average one month LIBOR plus one percent
      (1%)
      per annum measured from the Closing Date to the date of such payment. Amounts
      owing by CCE, if any, pursuant to this Section 2.4 shall be paid by CCE within
      five (5) Business Days after the Determination Date by delivery of immediately
      available funds to an account designated by ETP. Amounts owing by ETP, if any,
      pursuant to this Section 2.4 shall be paid by ETP within five (5) Business
      Days
      after the Determination Date by delivery of immediately available funds to
      an
      account designated by CCE.

     

    (d)  CCE
      Capital Contributions.
      ETP
      shall have no obligation to make any capital contributions pursuant to the
      CCE
      LLC Agreement as the owner of the 50% CCE Interest following the consummation
      of
      the transactions contemplated by the CCE Acquisition Agreement unless this
      Agreement is terminated in accordance with Article VII hereof.

     

    Section
      2.5  Deliveries
      by CCE at the Closing.
      At the
      Closing, CCE shall deliver, or cause its appropriate Affiliates to deliver,
      to
      ETP:

     

    (a)  an
      executed copy of the TPC Interests Assignment;

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    

     

    (b)  a
      cross-receipt acknowledging receipt of the 50% CCE Interest
      Assignment;

     

    (c)  a
      certificate from an authorized officer of CCE, dated as of the Closing Date,
      to
      the effect that the conditions set forth in Section 2.3(d), Section 6.2(a),
      Section 6.2(c), Section 6.2(g) and Section 6.2(i) of this Agreement have been
      satisfied;

     

    (d)  all
      other
      previously undelivered documents required by this Agreement to be delivered
      by
      CCE or its Affiliates to ETP at or prior to the Closing;

     

    (e)  resignations
      of each of the managers and officers (or persons acting in similar capacities)
      of TPC who are not employees of TPC; 

     

    (f)  the
      TPC
      Transition Services Agreement, duly executed by CCE and PEPL; and

     

    (g)  all
      such
      other instruments of sale, assignment, conveyance and transfer and releases,
      consents and waivers as in the reasonable opinion of ETP may be necessary to
      effect the sale, transfer, assignment, conveyance and delivery of the TPC
      Interests to ETP in accordance with this Agreement, in each case, as is
      necessary to effect the transactions contemplated by this
      Agreement.

     

    Section
      2.6  Deliveries
      by ETP at the Closing.
      At the
      Closing, ETP shall deliver to CCE:

     

    (a)  an
      executed copy of the 50% CCE Interest Assignment;

     

    (b)  a
      cross-receipt acknowledging receipt of the TPC Interests
      Assignment;

     

    (c)  a
      certificate from an authorized officer of ETP, dated as of the Closing Date,
      to
      the effect that the conditions set forth in Section 6.3(a) and Section 6.3(c)
      of
      this Agreement have been satisfied; 

     

    (d)  the
      TPC
      Transition Services Agreement, duly executed by ETP; and

     

    (e)  all
      other
      previously undelivered documents required by this Agreement to be delivered
      by
      ETP or its Affiliates to CCE at or prior to the Closing.

     

    ARTICLE
      III

    REPRESENTATIONS
      AND WARRANTIES OF CCE

     

    CCE
      hereby represents and warrants to ETP as follows:

     

    Section
      3.1  Organization;
      Qualification.

     

    (a)  CCE
      is a
      limited liability company duly organized, validly existing and duly qualified
      or
      licensed and in good standing under the laws of the state or jurisdiction of
      its
      formation and has all requisite corporate power to own, lease and operate its
      properties and to carry
      on
      its business as currently conducted. CCE is duly qualified or licensed to do
      business as a foreign limited liability company, and is, and has been, in good
      standing in each jurisdiction in which the nature of its business or the
      property it owns, leases or operates requires it to so qualify, be licensed
      or
      be in good standing, except for such failures to be qualified, licensed or
      in
      good standing that would not have a Material Adverse Effect. The CCE LLC
      Agreement is a legal, valid and binding agreement of the parties specified
      as
      parties thereto, enforceable against the parties thereto in accordance with
      its
      terms, except that such enforceability may be limited by applicable bankruptcy,
      insolvency, moratorium or other similar laws affecting or relating to
      enforcement of creditors’ rights generally or general principles of
      equity.

     

    (b)  CC
      Energy, TW Holdings and TPC are limited liability companies duly organized,
      validly existing and duly qualified or licensed and in good standing under
      the
      laws of the state or jurisdiction of their respective formation and have all
      requisite limited liability company power, as applicable, to own, lease and
      operate their respective properties and to carry on their respective businesses
      as currently conducted. True and correct copies of the Organizational Documents
      of TPC with all amendments thereto to the date hereof, have been made available
      by CCE to ETP or its representatives. CC Energy, TW Holdings and TPC are each
      duly qualified or licensed to do business as foreign limited liability companies
      and are, and have been, in good standing in each jurisdiction in which the
      nature of the respective businesses conducted by them or the property they
      own,
      lease or operate requires them to so qualify, be licensed or be in good standing
      except where the failure to be so authorized, qualified or licensed and in
      good
      standing would not have a Material Adverse Effect. Section 3.1(b) of the CCE
      Disclosure Letter sets forth all of the jurisdictions in which TPC is qualified
      to do business.

     

    Section
      3.2  Authority
      Relative to this Agreement and the CCE Acquisition Agreement.
      CCE has
      full limited liability company power and authority to execute and deliver this
      Agreement and the other agreements, documents and instruments to be executed
      and
      delivered by it in connection with this Agreement, and to consummate the
      transactions contemplated hereby and thereby. Except as set forth in Section
      3.2
      of the CCE Disclosure Letter, the execution, delivery and performance of this
      Agreement and the other agreements, documents and instruments to be executed
      and
      delivered in connection with this Agreement and the consummation of the
      transactions contemplated hereby and thereby have been duly and validly
      authorized by all the necessary action on the part of CCE, and no other
      corporate or other proceedings on the part of CCE or its members are necessary
      to authorize this Agreement and the other agreements, documents and instruments
      to be executed and delivered in connection with this Agreement, to consummate
      the transactions contemplated hereby and thereby or to consummate the
      transactions contemplated hereby or thereby. The resolutions attached hereto
      as
      Exhibit D have been duly approved and adopted by all of the members of the
      Executive Committee of CCE in accordance with the terms of the CCE LLC
      Agreement. This Agreement has been, and the other agreements, documents and
      instruments to be executed and delivered in connection with this Agreement
      as of
      the Closing Date will be, duly and validly executed and delivered by CCE, and
      assuming that this Agreement and the other agreements, documents and instruments
      to be executed and delivered in connection with this Agreement constitute legal,
      valid and binding agreements of each of the other parties hereto and thereto,
      are (in the case of this Agreement) or will be as of the Closing Date (in the
      case of the other agreements, documents and instruments to be executed and
      delivered in connection with this Agreement) enforceable against CCE in
      accordance with their respective terms, except that such enforceability may
      be
limited
      by applicable bankruptcy, insolvency, moratorium or other similar laws affecting
      or relating to enforcement of creditors’ rights generally or general principles
      of equity.

     

    Section
      3.3  TPC
      Interests.

     

    (a)  The
      TPC
      Interests are duly authorized, validly issued, fully paid membership interests
      of TPC and were not issued in violation of any preemptive rights. Except as
      set
      forth in Section 3.3(a) of the CCE Disclosure Letter, (i) there are no
      membership interests of TPC authorized, issued or outstanding or reserved for
      any purpose other than the TPC Interests, and (ii) there are no (A) existing
      options, warrants, calls, rights of first refusal, preemptive rights,
      subscriptions or other rights, agreements, arrangements or commitments of any
      character, relating to the TPC Interests, obligating CCE, TPC or any of their
      respective Affiliates to issue, transfer or sell, or cause to be issued,
      transferred or sold, any of the TPC Interests, (B) outstanding securities of
      CCE, TPC or any of their respective Affiliates that are convertible into or
      exchangeable or exercisable for any of the TPC Interests, (C) options, warrants
      or other rights to purchase from CCE, TPC or any of their respective Affiliates
      any such convertible or exchangeable securities or (D) other than this
      Agreement, contracts, agreements or arrangements of any kind relating to the
      issuance of any of the TPC Interests, or any such options, warrants or rights,
      pursuant to which, in any of the foregoing cases, CCE, TPC or any of their
      respective Affiliates are subject or bound.

     

    (b)  Except
      as
      set forth in Section 3.3(b) of the CCE Disclosure Letter, TW Holdings owns
      all
      of the issued and outstanding TPC Interests and has good and valid title to
      the
      TPC Interests, free and clear of all Encumbrances or other defects in title,
      and
      the TPC Interests have not been pledged or assigned to any Person. At the
      Closing, the TPC Interests will be transferred to ETP free and clear of all
      Encumbrances. The TPC Interests are not subject to any restrictions on
      transferability or voting agreements other than those imposed by this Agreement
      and by applicable securities laws.

     

    (c)  Except
      as
      set forth in Section 3.3(c) of the CCE Disclosure Letter, TPC does not have
      any
      subsidiaries or any stock or other equity interest (controlling or otherwise)
      in
      any corporation, limited liability company, partnership, joint venture or other
      entity.

     

    Section
      3.4  Consents
      and Approvals.
      Except
      as set forth in Section 3.4 of the CCE Disclosure Letter, neither CCE nor any
      of
      its Affiliates requires any consent, approval or authorization of, or filing,
      registration or qualification with, any Governmental Authority, or any other
      Person, as a condition to the execution and delivery of this Agreement or the
      performance of its obligations hereunder, except where the failure to obtain
      such consent, approval or authorization of, or filing of, registration or
      qualification with, any Governmental Authority, or any other Person would not
      materially and adversely impact the operations of TPC as currently
      conducted.

     

    Section
      3.5  No
      Conflict or Violation. Except as set forth in Section 3.5 of the CCE Disclosure
      Letter, the execution, delivery and performance by CCE of this Agreement does
      not:

     

    (a)  violate
      or conflict with any provision of the Organizational Documents of CCE or
      TPC;

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    

     

    (b)  violate
      any applicable provision of a law, statute, judgment, order, writ, injunction,
      decree, award, rule or regulation of any Governmental Authority, except where
      such violation would not have a Material Adverse Effect; or

     

    (c)  violate,
      result in a breach of, constitute (with due notice or lapse of time or both)
      a
      default or cause any obligation, penalty or premium to arise or accrue under
      any
      Material Contract, lease, loan, mortgage, security agreement, trust indenture
      or
      other material agreement or instrument to which TPC is a party or by which
      it is
      bound or to which any of its properties or assets is subject, except as would
      not have a Material Adverse Effect.

     

    Section
      3.6  Financial
      Information.
      The CCE
      Annual Financial Statements and the CCE Six Month Interim Financial Statements
      present fairly in all material respects, in accordance with GAAP consistently
      applied, the financial condition and results of operation of CCE as of the
      dates
      thereof and for the periods set forth therein, subject, in the case of the
      CCE
      Six Month Interim Financial Statements, to normal recurring year-end adjustments
      that are not material, either individually or in the aggregate, and the absence
      of full footnote disclosure. The Citrus Annual Financial Statements and the
      Citrus Six Month Interim Financial Statements present fairly in all material
      respects, in accordance with GAAP consistently applied, the financial condition
      and results of operation of Citrus as of the dates thereof and for the periods
      set forth therein, subject, in the case of the Citrus Six Month Interim
      Financial Statements, to normal recurring year-end adjustments that are not
      material, either individually or in the aggregate, and the absence of full
      footnote disclosure. The TPC Annual Financial Statements and the TPC Six Month
      Interim Financial Statements present fairly in all material respects, in
      accordance with GAAP consistently applied, the financial condition and results
      of operation of TPC as of the dates thereof and for the periods set forth
      therein, subject, in the case of the TPC Six Month Interim Financial Statements,
      to normal recurring year-end adjustments that are not material, either
      individually or in the aggregate, and the absence of full footnote
      disclosure.

     

    Section
      3.7  Contracts. 

     

    (a)  Section
      3.7(a) of the CCE Disclosure Letter sets forth a list, as of the date hereof,
      of
      each contract and lease to which TPC is a party that is material to TPC (each
      contract set forth in Section 3.7(a) of the CCE Disclosure Letter being referred
      to herein as a “Material
      Contract”);
      provided,
      however,
      that
      any purchase or sale order arising in the ordinary course of business and any
      contract reasonably expected to involve the payment or receipt of an aggregate
      amount of less than $2,000,000 during its term remaining after the date of
      this
      Agreement shall not be deemed to be a Material Contract. 

     

    (b)  Section
      3.7(b) of the CCE Disclosure Letter sets forth a list, as of the date hereof,
      of
      each contract that TPC has with an Affiliate, other than with respect to any
      purchases and sales arising in the ordinary course of business.

     

    (c)  Except
      as
      set forth in Section 3.7(c) of the CCE Disclosure Letter, each Material Contract
      is a valid and binding agreement of TPC and, to the Knowledge of CCE, is in
      full
      force and effect.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

    

     

    (d)  Except
      as
      set forth in Section 3.7(d) of the CCE Disclosure Letter, CCE has no Knowledge
      of any default under any Material Contract, other than defaults that have been
      cured or that would not have a Material Adverse Effect. TPC and, to CCE’s
      Knowledge, the other parties to any Material Contract, have performed in all
      respects all obligations required to be performed by them under any Material
      Contract, except where the failure so to perform would not have a Material
      Adverse Effect. CCE has made available to ETP or its representatives true and
      complete originals or copies of all the Material Contracts.

     

    Section
      3.8  Compliance
      with Law.
      Except
      for Environmental Laws and Tax Laws, which are the subject of Section 3.15
      and
      Section 3.16, respectively, and except as set forth in Section 3.8 of the CCE
      Disclosure Letter, since November 17, 2004, TPC has complied with all federal,
      state, local or foreign laws, statutes, ordinances, rules, regulations,
      judgments, orders, writs, injunctions or decrees of any Governmental Authority
      applicable to its properties, assets and business, except where such
      noncompliance would not have a Material Adverse Effect. TPC has not received
      written notice of any material violation of any such law, license, regulation,
      order or other legal requirement or, to the Knowledge of CCE, is in material
      default with respect to any order, writ, judgment, award, injunction or decree
      of any Governmental Authority, applicable to TPC or any of its assets,
      properties or operations. 

     

    Section
      3.9  Permits.
      Except as set forth in Section 3.9(a) of the CCE Disclosure Letter, TPC has
      all
      permits, licenses, certificates of authority, orders and approvals of, and
      has
      made all filings, applications and registrations with, Governmental Authorities
      necessary for the conduct of the business operations of TPC as presently
      conducted (collectively, the “TPC
      Permits”),
      except for those Permits the absence of which would not, individually or in
      the
      aggregate, have a Material Adverse Effect. Set forth on Section 3.9(b) of the
      CCE Disclosure Letter is a list of the material TPC Permits.

     

    Section
      3.10  Litigation.
      Except as identified in Section 3.10 of the CCE Disclosure Letter, there are
      no
      lawsuits, actions, proceedings or investigations, pending, or, to CCE’s
      Knowledge, threatened, against CCE or any of its Affiliates or any executive
      officer, manager or director thereof relating to the transactions contemplated
      hereby or the assets or business of TPC, except, in the case of lawsuits,
      actions, proceedings, investigations relating to the assets or business of
      TPC,
      as would not, individually or in the aggregate, have a Material Adverse Effect.
      CCE and its Affiliates are not subject to any outstanding judgment, order,
      writ,
      injunction, decree or award entered in an Action to which CCE or any of its
      Affiliates was a named party relating to the transactions contemplated hereby
      or
      the assets or business of TPC, except, in the case of lawsuits, actions,
      proceedings, investigations relating to the assets or business of TPC, as would
      not, individually or in the aggregate, have a Material Adverse
      Effect. 

     

    Section
      3.11  Title
      to
      Properties. TPC has good and valid title to all of the tangible assets and
      properties that are reflected in the TPC Interim Balance Sheet (except for
      assets and properties sold, consumed or otherwise disposed of in the ordinary
      course of business since the date of the TPC Interim Balance Sheet), and such
      tangible assets and properties are owned free and clear of all Encumbrances,
      except for (a) Encumbrances listed in Section 3.11 of the CCE Disclosure Letter,
      (b) Permitted Encumbrances, and (c) Encumbrances which will be discharged on
      or
      before the Closing Date. To the Knowledge of CCE, except as set forth in Section
      3.11 of the CCE Disclosure Letter, TPC owns valid and defeasible fee title
      to,
      or holds a valid leasehold interest
      in, or a valid right-of-way or easement (all such rights-of-way and easements
      collectively, the “Rights-Of-Way”)
      through, all real property (“Real
      Property”)
      used
      or necessary for the conduct of business of TPC as presently conducted, and
      all
      such Real Property (other than Rights-Of-Way) is owned or leased free and clear
      of all Encumbrances, in each case except for (a) Encumbrances listed in Section
      3.11 of the CCE Disclosure Letter, (b) Permitted Encumbrances and (c)
      Encumbrances that will be discharged on or before the Closing Date. 

     

    Section
      3.12  Employee
      Matters. 

     

    (a) Except
      as
      set forth in Section 3.12(a) of the CCE Disclosure Letter, none of TPC, CCE
      or
      their respective ERISA Affiliates sponsors, maintains, contributes to or has
      an
      obligation to contribute to, any “employee benefit plan,” as defined in Section
      3(3) of ERISA, in which any current or former TPC Employee is or has been
      eligible to participate since November 17, 2004 (“ERISA
      Plans”).
      For
      the avoidance of doubt, (1) the term “ERISA Plans” does not include any Enron
      Plan, (2) November 17, 2004 is the date of the closing of the acquisition by
      CCE
      of indirect ownership of TPC from Enron Corp. and certain of its affiliates,
      and
      (3) CCE was formed on May 14, 2004, in connection with such
      acquisition.

    

    (b) Except
      as
      set forth in Section 3.12(b) of the CCE Disclosure Letter, none of TPC, CCE
      or
      any of their respective ERISA Affiliates has established, sponsors, maintains,
      or contributes to any policy, plan, agreement or arrangement that is not set
      forth in Section 3.12(a) of the CCE Disclosure Letter providing for employment
      terms, change in control benefits, severance benefits, retention benefits,
      insurance coverage (including any self-insured arrangements), workers’
compensation, disability benefits, supplemental unemployment benefits, vacation
      benefits, retirement benefits, deferred compensation, profit-sharing, bonuses,
      or other forms of incentive compensation, or post-retirement insurance,
      compensation or benefits (whether or not an ERISA Plan) that (i) is entered
      into, sponsored, maintained, or contributed to, as the case may be, by TPC,
      or
      (ii) has covered any current or former TPC Employee or independent contractor
      to
      TPC since November 17, 2004. The policies, plans, agreements, and arrangements
      described in this Section 3.12(b) are hereinafter referred to as the “Benefit
      Programs or Agreements.” For the avoidance of doubt, the term “Benefit
      Programs or Agreements” does
      not
      include any Enron Plan. The Benefit Programs and Agreements and the ERISA Plans
      are hereinafter referred to collectively as the “Employee
      Benefit Plans.”

    

    (c) True,
      correct, and complete copies of each of the ERISA Plans sponsored, maintained
      or
      contributed to on behalf of the TPC Employees or in which such employees are
      otherwise eligible to participate, and related trusts, if applicable, including
      all amendments thereto, have been furnished to ETP. There has also been
      furnished to ETP, with respect to each ERISA Plan required to file such report
      and description, the most recent report on Form 5500, the summary plan
      description and any summaries of material modifications thereto, all actuarial
      reports or valuations relating to each ERISA Plan subject to Title IV of ERISA
      or required to be accounted for pursuant to Statements of Financial Accounting
      Standard Nos. 106 and 132(R), if any, and the most recent determination letter,
      if any, issued by the IRS with respect to any ERISA Plan intended to be
      qualified under Section 401 of the Code. True, correct, and complete copies
      or
      descriptions of all Benefit Programs and Agreements have also been furnished
      to
      ETP.

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

    

    

    (d) Except
      as
      set forth in Section 3.12(e)(vii) of the CCE Disclosure Letter or described
      in
      Section 5.5(e), with respect to retiree medical benefits, none of TPC, CCE
      or
      any of CCE’s ERISA Affiliates has any legal commitment to create, incur
      liability with respect to or cause to exist any other employee benefit plan,
      program or arrangement for the benefit of any current or former TPC Employee
      or
      to enter into any contract or agreement to provide compensation or benefits
      to
      any former or current TPC Employee.

    

    (e) Except
      as
      set forth in Section 3.12(e) of the CCE Disclosure Letter, with respect to
      each
      Employee Benefit Plan:

    

    (i) the
      applicable reporting, disclosure and other requirements of ERISA (and other
      Applicable Law) have been complied with in all material respects;

    

    (ii) there
      is
      no act or omission of TPC or any of its ERISA Affiliates that would (a)
      constitute a breach of fiduciary duty under Section 404 of ERISA or a
      transaction (including the transactions contemplated by this Agreement) intended
      to evade liability under Section 4069 of ERISA, in either case that would
      subject TPC to a liability, or (b) constitute a prohibited transaction under
      Section 406 of ERISA or Section 4975 of the Code that would subject TPC or
      any
      plan fiduciary, directly or indirectly (through indemnification obligations
      or
      otherwise), to an excise Tax or civil penalty under Section 4975 of the Code
      or
      Section 502(i) of ERISA in an amount that would be material;

    

    (iii) no
      ERISA
      Plan is subject to Title IV of ERISA;

    

    (iv) all
      contributions or payments required to be made under each ERISA Plan by reason
      of
      Part 3 of Subtitle B of Title I of ERISA, Section 412 of the Code, or otherwise
      prior to the Closing Date have been and will be timely made;

    

    (v) there
      are
      no pending or, to CCE’s Knowledge, threatened actions, suits or claims pending
      (other than routine claims for benefits); 

    

    (vi) to
      CCE’s
      Knowledge, there is no matter pending (other than routine qualification
      determination filings) with respect to any Employee Benefit Plan before the
      IRS,
      the Department of Labor, the PBGC, or any other Governmental
      Authority;

    

    (vii) except
      to
      the extent required under Section 601 of ERISA or Section 4980 of the Code,
      TPC
      has no present or future obligation to make any payment to or with respect
      to
      any former or current TPC Employee or any dependent of any such former or
      current TPC Employee under any retiree medical benefit plan or other retiree
      welfare benefit plan;

    

    (viii) there
      is
      no Employee Benefit Plan covering any former or current TPC Employee that
      provides for the payment by TPC of any amount that is or is reasonably likely
      to
      be (a) not deductible as a result of Section 162(a)(1) or 404 of the Code,
      (b)
      an “excess parachute payment” pursuant to Section 280G of the Code or (c)
      subject to the additional tax pursuant to Section 409A of the
      Code;

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

    

    

    (ix) except
      as
      otherwise provided in this Agreement, neither the execution of this Agreement
      nor the consummation of the transactions contemplated hereby will (a) entitle
      any TPC Employee to severance, retention or change in control payments or
      benefits to which such employee was not previously entitled, or any increase
      in
      severance retention or change in control payments or benefits upon a termination
      of employment or consummation of the transactions contemplated by this
      Agreement, (b) require CCE, TPC or any of their respective ERISA Affiliates
      to
      make a larger contribution to, pay greater benefits under, or provide any
      additional vesting, service credit or other rights under any Employee Benefit
      Plan than it otherwise would, whether or not some subsequent action or event
      would be required to cause such payment or provision to be triggered or (c)
      trigger any other material obligation pursuant to the Employee Benefit Plans
      that would be a liability of ETP or TPC after the Closing Date;

    

    (x) each
      ERISA Plan intended to qualify under Section 401(a) of the Code has been
      determined to be so qualified by the IRS and, to the Knowledge of CCE, nothing
      has occurred which has resulted or is likely to result in the revocation of
      such
      determination or which requires or is reasonably likely to require action under
      the compliance resolution programs of the IRS to preserve such
      qualification;

    

    (xi) as
      to any
      ERISA Plan intended to be qualified under Section 401(a) of the Code, there
      has
      been no termination or partial termination of any ERISA Plan within the meaning
      of Section 411(d)(3) of the Code;

    

    (xii) all
      contributions required to be made to or with respect to the Employee Benefit
      Plans pursuant to their terms and the provisions of ERISA, the Code, or any
      other Applicable Law have been timely made;

    

    (xiii) each
      trust funding an Employee Benefit Plan, which trust is intended to be exempt
      from federal income taxation pursuant to Section 501(c)(9) of the Code,
      satisfies the requirements of such section and has received a favorable
      determination letter from the IRS regarding such exempt status and has not,
      since receipt of the most recent favorable determination letter, been amended
      or
      operated in a way which would adversely affect such exempt status;

    

    (xiv) except
      as
      set forth in Section 3.12(e)(vii) of the CCE Disclosure Letter or described
      in
      Section 5.5(e), each ERISA Plan which is an “employee welfare benefit plan,” as
      such term is defined in Section 3(1) of ERISA, may be unilaterally amended
      or
      terminated in its entirety without liability except as to benefits accrued
      thereunder prior to such amendment or termination; and

    

    (xv) except
      as
      set forth in Section 3.12(e)(vii) of the CCE Disclosure Letter or described
      in
      Section 5.5(e), no Employee Benefit Plan provides retiree medical or retiree
      life insurance benefits to any Person and TPC is not contractually or otherwise
      obligated (whether or not in writing) to provide any Person with life insurance
      or medical benefits upon 

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

    retirement
      or termination of employment, other than as required by the provisions of
      Sections 601 through 608 of ERISA and Section 4980B of the Code.

    

    (f) None
      of
      TPC or any of its ERISA Affiliates contributes to or has an obligation to
      contribute to, and has not at any time within six years prior to the Closing
      Date contributed to or had an obligation to contribute to, a multiemployer
      plan
      (as defined in Section 4001(a)(3) of ERISA), on behalf of a present or former
      TPC Employee;

    

    (g) No
      current circumstance has arisen or future circumstance could arise that would
      lead TPC or, after the transaction contemplated by this Agreement, ETP, to
      incur
      any ERISA Title IV liability or suffer the imposition of any Lien on any of
      their assets with respect to liabilities relating to any ERISA Plan or any
      employee benefit plan subject to Title IV of ERISA that was sponsored,
      maintained or contributed to by (A) CCE, (B) an ERISA Affiliate of CCE, or
      (C)
      any corporation, trade, business or entity under common control with CCE or
      an
      ERISA Affiliate of CCE, within the meaning of Section 414(b), (c) or (m) of
      the
      Code or Section 4001 of ERISA, within the six (6) years prior to the Closing
      Date, or to which any of them had an obligation to contribute during such
      period; and 

    

    (h) With
      respect to circumstances not addressed in Section 3.12(g), except as set forth
      in Section 3.12(e)(vii) of the CCE Disclosure Letter or described in Section
      5.5(e), no current circumstance has arisen or future circumstance could arise
      that would lead TPC or, after the transaction contemplated by this Agreement,
      ETP, to incur any liability directly or indirectly (through indemnification
      or
      otherwise), or suffer the imposition of a Lien on any of their assets, relating
      to or arising from the participation of the TPC employees or former employees
      in
      any of the Enron Plans or the status of TPC, during the period preceding
      November 17, 2004, as an ERISA Affiliate of Enron Corp.

    

    Section
      3.13  Labor
      Relations.
      TPC
      is
      not a party to any labor or collective bargaining agreements, and there are
      no
      labor or collective bargaining agreements which pertain to any employees of
      TPC.
      Within the preceding eighteen (18) months, there have been no representation
      or
      certification proceedings, or petitions seeking a representation proceeding,
      pending or, to the Knowledge of CCE, threatened in writing to be brought or
      filed with the National Labor Relations Board or any other labor relations
      tribunal or authority with respect to TPC. Within the preceding eighteen (18)
      months, to the Knowledge of CCE, there have been no organizing activities
      involving TPC with respect to any group of its employees. Since May 1, 2006,
      neither TPC nor any Affiliate of TPC has terminated the employment of any TPC
      Employee or any employee of any of its Affiliates who provides services in
      connection with TPC’s business for reasons other than misconduct or failure to
      perform the employee’s duties and no circumstance has occurred that would give
      rise to a requirement that TPC give notice under the Worker Adjustment and
      Retraining Notification Act or any similar state law. As of the date of this
      Agreement, no TPC Employee or Shared Service Employee has a legal or contractual
      right to reinstatement with TPC or any Affiliate of TPC. 

     

    Section
      3.14  Intellectual
      Property. Except as set forth in Section 3.14 of the CCE Disclosure Letter,
      on the Closing Date TPC will, either in its own name or by operation of the
      TPC
      Transition Services Agreement, own or possess licenses or other legally
      enforceable rights to use all patents, copyrights (including any copyrights
      in
      proprietary software), trademarks, service
      marks, trade names, logos, and other intellectual property rights, software
      object and source code as are necessary to conduct its business as currently
      conducted, except those the lack of which would not materially and adversely
      affect the operations of TPC as currently conducted; and to CCE’s Knowledge,
      there is no conflict by CCE or TPC with the rights of others therein that would
      materially and adversely affect the operations of TPC as currently
      conducted. 

     

    Section
      3.15  Environmental
      Matters. Except as set forth in Section 3.15 of the CCE Disclosure
      Letter:

     

    (a)  TPC
      and
      its properties and operations are, and to CCE’s Knowledge, during the relevant
      time periods specified in all applicable statutes of limitation, have been,
      in
      compliance with all applicable Environmental Laws, except for such noncompliance
      as would not, individually or in the aggregate, have a Material Adverse Effect;
      

     

    (b)  TPC
      possesses all Environmental Permits required in order to conduct its operations
      as presently conducted or, where such Environmental Permits have expired, has
      applied for a renewal of such Environmental Permits in a timely fashion and,
      to
      CCE’s knowledge, all such Environmental Permits are in the name of the proper
      entity and will remain in full force and effect immediately following the
      Closing, except where the failure to possess an Environmental Permit or to
      have
      applied for a renewal of an Environmental Permit would not, individually or
      in
      the aggregate, have a Material Adverse Effect;

     

    (c)  TPC
      and
      its properties and operations are not subject to any pending or, to CCE’s
      Knowledge, threatened Environmental Claims, nor has TPC received any notice
      of
      violation, noncompliance, or enforcement or any notice of investigation or
      remediation from any Governmental Authority pursuant to Environmental Laws,
      except for such matters as would not, individually or in the aggregate, have
      a
      Material Adverse Effect; 

     

    (d)  Since
      November 17, 2004, there has been no, and to CCE’s Knowledge, prior to November
      17, 2004, there has been no, Release of Hazardous Substances on or from the
      properties of TPC or from or in connection with the operations of TPC in
      violation of any Environmental Laws or in a manner that could give rise to
      any
      remedial or corrective action obligations pursuant to Environmental Laws, except
      such as would not, individually or in the aggregate, have a Material Adverse
      Effect; 

     

    (e)  Since
      November 17, 2004, there has been no, and, to CCE’s Knowledge, prior to November
      17, 2004, there has been no exposure of any Person or property to any Hazardous
      Substances in connection with the business, properties or operations of TPC
      that
      could reasonably be expected to form the basis for an Environmental Claim or
      any
      other claim for Damages or compensation, except for such Environmental Claims
      or
      other claims for Damages as would not, individually or in the aggregate, have
      a
      Material Adverse Effect; and

     

    (f)  CCE
      has
      made available for inspection by ETP complete and correct copies of all
      environmental assessment and audit reports and studies completed since January
      1, 2003, addressing potentially material environmental matters and all
      correspondence completed since January 1, 2003 addressing potentially material
      Environmental Claims relating to TPC that are
      in
      the possession of CCE or TPC, except for any such materials as CCE reasonably
      believes are subject to the attorney-client privilege.

     

    The
      representations and warranties set forth in this Section 3.15 are CCE’s sole and
      exclusive representations and warranties relating to environmental
      matters.

     

    Section
      3.16  Tax
      Matters.

     

    (a)  Except
      as
      set forth in Section 3.16(a) of the CCE Disclosure Letter or as would not have
      a
      Material Adverse Effect, all federal, state and local Tax Returns required
      to be
      filed by or on behalf of TPC, and each consolidated, combined, unitary,
      affiliated or aggregate group of which TPC is a member, has been timely filed
      (taking into account applicable extensions), and all Taxes shown as due on
      such
      Tax Returns have been paid, or adequate reserves therefor have been established.
      

     

    (b)  Except
      as
      set forth in Section 3.16(b) of the CCE Disclosure Letter or as would not have
      a
      Material Adverse Effect, there is no deficiency, proposed adjustment, or matter
      in controversy that has been asserted or assessed in writing with respect to
      any
      Taxes due and owing by TPC that has not been paid or settled in full.

     

    (c)  Except
      as
      would not have a Material Adverse Effect, TPC has timely withheld and timely
      paid all Taxes required to be withheld by them in connection with any amounts
      paid or owing to any employee, creditor, independent contractor or other third
      party. 

     

    (d)  Except
      as
      would not have a Material Adverse Effect, there are no liens for Taxes upon
      any
      of the assets of TPC except for liens for Taxes not yet due and payable.

     

    (e)  Except
      as
      would not have a Material Adverse Effect, no property of TPC is required to
      be
      treated as “tax-exempt use property” within the meaning of Code Section 168(h),
      and no property of TPC is subject to a tax benefit transfer lease subject to
      the
      provisions of former Section 168(f)(8) of the Code. 

     

    (f)  At
      all
      times since its formation, CCE has been treated as a partnership for federal
      tax
      purposes pursuant to Treasury Regulation Section 301.7701-3.

     

    (g)  At
      all
      times since their formation, each of CC Energy, TW Holdings and TPC have been
      disregarded as separate entities for federal tax purposes pursuant to Treasury
      Regulation Section 301.7701-3.

     

    (h)  CCE
      has
      made or will make a valid election under Section 754 of the Code that will
      be in
      effect at the time of the CCE Acquisition.

     

    Section
      3.17  Absence
      of Certain Changes or Events. 

     

    (a)  Except
      as
      set forth in Section 3.17(a) of the CCE Disclosure Letter, since December 31,
      2005, TPC has conducted its business in the ordinary course of business,
      consistent with past practice (as such practice existed during the period of
      CCE’s ownership of TPC). 

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

    

     

    (b)  Except
      as
      set forth in Section 3.17(b) of the CCE Disclosure Letter, since December 31,
      2005, there has not been with respect to TPC any event or development or change
      which has resulted or would reasonably be expected to result in a Material
      Adverse Effect. 

     

    (c)  Except
      as
      set forth in Section 3.17(c) of the CCE Disclosure Letter, since June 30, 2006,
      TPC has not taken any action that would have been prohibited had Section 5.1(b)
      been in effect from and after June 30, 2006.

     

    Section
      3.18  Absence
      of Undisclosed Liabilities.
      Since
      June 30, 2006, TPC has incurred no Liabilities (whether absolute, accrued,
      contingent or otherwise) that would be required by GAAP to be included in the
      financial statements of TPC, except those Liabilities (a) disclosed and reserved
      against in the TPC Interim Balance Sheet, (b) set forth in Section 3.18 of
      the
      CCE Disclosure Letter, (c) incurred in the ordinary course of business since
      June 30, 2006 and (d) that have not resulted in a Material Adverse
      Effect.

     

    Section
      3.19  Brokerage
      and Finders’ Fees. None of CCE, TPC or any of their Affiliates or their
      respective stockholders, partners, managers, directors, officers or employees,
      has incurred, or will incur any brokerage, finders’ or similar fee in connection
      with the transactions contemplated by this Agreement.

     

    Section
      3.20  Affiliated
      Transactions. Except as described in Section 3.20 of the CCE Disclosure
      Letter, and except for trade payables and receivables arising in the ordinary
      course of business for purchases and sales of goods or services consistent
      with
      past practice, TPC has not been a party over the past twelve (12) months to
      any
      material transaction or agreement with CCE or any Affiliate of CCE (other than
      TPC) and no director or officer of CCE or its Affiliates (other than TPC),
      has,
      directly or indirectly, any material interest in any of the assets or properties
      of TPC.

     

    Section
      3.21  Insurance.

     

    (a)  Section
      3.21 of the CCE Disclosure Letter sets forth a true and complete list of all
      current policies of all material property and casualty insurance, insuring
      the
      properties, assets, employees and/or operations of TPC (collectively, the
“Insurance
      Policies”).
      To
      the Knowledge of CCE, all premiums payable under the Insurance Policies have
      been paid in a timely manner and TPC has complied in all material respects
      with
      the terms and conditions of all such Insurance Policies. 

     

    (b)  As
      of the
      date hereof, CCE has not received any written notification of the failure of
      any
      of the Insurance Policies to be in full force and effect. To the Knowledge
      of
      CCE, TPC is not in default under any provision of the Insurance Policies, and
      except as set forth in Section 3.21 of the CCE Disclosure Letter, there is
      no
      claim by TPC or any other Person pending under any of the Insurance Policies
      as
      to which coverage has been denied or disputed by the underwriters or issuers
      thereof. 

     

    Section
      3.22  Regulatory
      Matters. 

     

    (a)  TPC
      is a
“natural gas company” as that term is defined in Section 2 of the Natural Gas
      Act (“NGA”).
      TPC
      is in compliance in all material respects with the provisions
      of the
      NGA,
      the Natural Gas Policy Act of 1978 (“NGPA”),
      the
      Pipeline Safety Improvement Act of 2002, and the rules and regulations
      promulgated by FERC pursuant thereto. TPC is in compliance in all material
      respects with the terms and conditions of all tariff provisions, FERC rate
      and
      certificate orders, and other orders and authorizations issued by FERC, in
      each
      case as applicable to TPC. No approval by FERC under the NGA or the Federal
      Power Act is required in connection with the execution and delivery of this
      Agreement by CCE or the consummation of the transactions contemplated hereby.
      Except as identified in Section 3.22 of the CCE Disclosure Schedule, the Form
      No. 2 Annual Reports filed by TPC with FERC for the years ended December 31,
      2004 and December 31, 2005 were true and correct in all material respects as
      of
      the dates thereof, and since January 1, 2005, TPC has not become subject to
      any
      proceeding under Section 5 of the NGA or, except as otherwise permitted by
      Section 5.1, any general rate case proceeding commenced under Section 4 of
      the
      NGA by reason of a filing made with the FERC after January 1, 2005.

     

    (b)  Except
      as
      identified in Section 3.22 of the CCE Disclosure Letter and except for general
      industry proceedings including audits or reviews of individual companies arising
      from general industry proceedings such as Order 2004, there are no pending
      or,
      to CCE’s Knowledge, reasonably anticipated FERC administrative or regulatory
      proceedings, including without limitation any rate proceeding under Section
      4 or
      Section 5 of the NGA or any NGA Section 7 certificate proceeding, investigation,
      complaint, audit, or show cause proceedings to which TPC is a party. CCE
      acknowledges that, as a result of a rate settlement in FERC Docket Nos.
      RP95-271, et al., TPC is obligated to prepare and file the TPC Rate Case for
      rates to be effective November 1, 2006.

     

    Section
      3.23  Internal
      Controls.

     

    (a)  The
      system of internal accounting controls that is applicable to TPC is sufficient
      to provide reasonable assurance that: (i) transactions are executed in
      accordance with management’s general or specific authorizations, (ii)
      transactions are recorded as necessary to permit preparation of financial
      statements in conformity with GAAP and to maintain asset accountability, (iii)
      access to assets is permitted only in accordance with management’s general or
      specific authorization and (iv) the recorded accountability for physical assets
      is compared with the existing physical assets at reasonable intervals and
      appropriate actions are taken with respect to any differences.

     

    (b)  Since
      November 17, 2004, neither TPC nor, to CCE’s Knowledge, any director, manager,
      officer, employee, auditor, accountant or representative of TPC, has received
      or
      otherwise had or obtained knowledge of any complaint, allegation, assertion
      or
      claim, whether written or oral, regarding the accounting or auditing practices,
      procedures, methodologies or internal accounting controls of or for TPC,
      including any complaint, allegation, assertion or claim that TPC has engaged
      in
      fraudulent accounting or auditing practices. Since November 17, 2004, no
      attorney representing TPC, whether or not employed by TPC, has reported evidence
      of a violation of securities laws, breach of fiduciary duty or similar violation
      by TPC or any of its officers, directors, managers, employees or agents to
      TPC’s
      board of managers (or comparable managing body) or any committee thereof or
      to
      any manager or officer of TPC.

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

    

     

    (c)  Except
      as
      disclosed in Section 3.23(c) of the CCE Disclosure Letter, there are no
      off-balance sheet structures or off-balance sheet transactions with respect
      to
      TPC or that would be required to be reported or set forth in the periodic
      reports filed by a reporting company under the Exchange Act.

     

    Section
      3.24  Hedging.
      Except
      as set forth on Section 3.24 of the CCE Disclosure Letter, TPC is not engaged
      in
      any natural gas or other futures or options trading in respect of which it
      has
      any material future liability, or is a party to any swaps, hedges, futures
      or
      similar instruments.

     

    Section
      3.25  Bank
      Accounts; Powers of Attorney. Section 3.25 of the CCE Disclosure Letter sets
      forth (a) the name of each financial institution with which TPC has borrowing
      or
      investment agreements, deposit or checking accounts or safe deposit boxes,
      (b)
      the types of those arrangements and accounts including the names in which the
      accounts or boxes are held, the account or box numbers and the name of each
      Person authorized to draw thereon or have access thereto and (c) the names
      of
      all Persons, if any, holding powers of attorney (other than powers of attorney
      incidental to commercial relationships entered into in the ordinary course
      of
      business) from TPC and a summary statement of the terms thereof. No Contract
      to
      which TPC is a party provides for the payment by the counterparty to any bank
      account other than those set forth on Section 3.25 of the CCE Disclosure
      Letter.

     

    Section
      3.26  Gas
      Imbalances. Section 3.26 of the CCE Disclosure Letter sets forth all gas
      imbalances on TPC’s pipeline system as of June 30, 2006. All gas imbalances on
      TPC’s pipeline system (whether as of June 30, 2006 or thereafter) are resolved
      pursuant to the terms of Operational Balancing Agreements (“OBAs”).
      The
      majority of OBAs follow the valuation methodology described in TPC’s tariff,
      which calls for imbalances to be resolved using a Monthly Index Price as
      calculated under Section 27 of the tariff’s General Terms and Conditions and
      Section 5(c) of the tariff’s Operator Balancing Agreement - Form N. TPC has
      certain grandfathered volumetric OBAs that do not follow Form N and for which
      the revaluation of outstanding volumetric imbalances impacts TPC's monthly
      income statement. Volumetric imbalances are noted in Section 3.26 of the CCE
      Disclosure Letter. The values of gas imbalances as determined pursuant to the
      imbalance resolution methodology set forth in the OBAs are used in preparing
      each balance sheet included in the TPC Annual Financial Statements and the
      TPC
      Six Month Interim Financial Statements.

     

    Section
      3.27  No
      Other Representations or Warranties. Except for the representations and
      warranties contained in this Article III, neither CCE nor any other Person
      makes
      any other express or implied representation or warranty on behalf of
      CCE.

     

    ARTICLE
      IV

    REPRESENTATIONS
      AND WARRANTIES OF ETP

     

    ETP
      hereby represents and warrants to CCE as follows:

     

    Section
      4.1  Corporate
      Organization; Qualification.
      ETP is
      a limited partnership duly organized, validly existing and duly qualified or
      licensed and in good standing under the laws of the state or jurisdiction of
      its
      formation and has all requisite limited partnership power to
      own, lease
      and
      operate its properties and to carry on its business as currently conducted.
      ETP
      is duly qualified or licensed to do business as a foreign limited partnership
      and is, and has been, in good standing in each jurisdiction in which the nature
      of the business conducted by it or the property it owns, leases or operates
      requires it to so qualify, be licensed or be in good standing, except for such
      failures to be qualified, licensed or in good standing that would not materially
      affect the consummation of the transactions contemplated by this
      Agreement. 

     

    Section
      4.2  Authority
      Relative to this Agreement. ETP has full limited partnership power and
      authority to execute and deliver this Agreement and the other agreements,
      documents and instruments to be executed and delivered by it in connection
      with
      this Agreement, including the CCE Acquisition Agreement, and to consummate
      the
      transactions contemplated hereby and thereby. The execution, delivery and
      performance of this Agreement and the other agreements, documents and
      instruments to be executed and delivered in connection with this Agreement
      (including the CCE Acquisition Agreement) and the consummation of the
      transactions contemplated hereby and thereby have been duly and validly
      authorized by all the necessary action on the part of ETP, and no other
      proceedings on the part of ETP are necessary to authorize this Agreement and
      the
      other agreements, documents and instruments to be executed and delivered in
      connection with this Agreement (including the CCE Acquisition Agreement) or
      to
      consummate the transactions contemplated hereby and thereby. This Agreement
      and
      the CCE Acquisition Agreement each have been, and the other agreements,
      documents and instruments to be executed and delivered in connection with this
      Agreement as of the Closing Date will be, duly and validly executed and
      delivered by ETP, and assuming that this Agreement, the CCE Acquisition
      Agreement and the other agreements, documents and instruments to be executed
      and
      delivered in connection with this Agreement and the CCE Acquisition Agreement
      constitute legal, valid and binding agreements of the other parties thereto
      are
      (in the case of this Agreement) or will be as of the Closing Date (in the case
      of the other agreements, documents and instruments to be executed and delivered
      in connection with this Agreement), enforceable against ETP in accordance with
      their respective terms, except that such enforceability may be limited by
      applicable bankruptcy, insolvency, moratorium or other similar laws affecting
      or
      relating to enforcement of creditors’ rights generally or general principles of
      equity. 

     

    Section
      4.3  50%
      CCE Interest. Effective as of the closing of the transactions under the CCE
      Acquisition Agreement, ETP will own all of the issued and outstanding 50% CCE
      Interest and will have good, valid and marketable title to the 50% CCE Interest,
      free and clear of all Encumbrances or other defects in title, and the 50% CCE
      Interest will not have not been pledged or assigned to any Person. At the
      Closing, the 50% CCE Interest will be transferred by ETP to CCE free and clear
      of all Encumbrances. Effective as of the closing of the transactions under
      the
      CCE Acquisition Agreement, the 50% CCE Interest will not be subject to any
      restrictions on transferability or voting agreements other than those imposed
      by
      this Agreement, the limited liability company agreement of CCE and applicable
      securities laws.

     

    Section
      4.4  Consents
      and Approvals. Except for any approvals of the transactions contemplated by
      the CCE Acquisition Agreement (or expiration of waiting periods) under the
      HSR
      Act and except for approvals required from the FCC, ETP does not require any
      consent, approval or authorization of, or filing, registration or qualification
      with, any Governmental Authority, or any other Person as a condition to the
      execution and delivery of this Agreement or the performance of the obligations
      hereunder, except where the failure to obtain such consent, approval
      or authorization of, or filing of, registration or qualification with, any
      Governmental Authority, or any other Person would not materially affect the
      consummation of the transactions contemplated by this Agreement. 

     

    Section
      4.5  No
      Conflict or Violation. The execution, delivery and performance by ETP of
      this Agreement does not: 

     

    (a)  violate
      or conflict with any provision of the Organizational Documents of
      ETP;

     

    (b)  violate
      any applicable provision of a law, statute, judgment, order, writ, injunction,
      decree, award, rule or regulation of any Governmental Authority; or

     

    (c)  violate,
      result in a breach of, constitute (with due notice or lapse of time or both)
      a
      default or cause any material obligation, penalty or premium to arise or accrue
      under any material contract, lease, loan, agreement, mortgage, security
      agreement, trust indenture or other material agreement or instrument to which
      ETP is a party or by which it is bound or to which any of its properties or
      assets is subject. 

     

    Section
      4.6  Litigation.
      There
      are no lawsuits, actions, proceedings, or, to ETP’s knowledge, any
      investigations, pending or, to ETP’s knowledge, threatened, against ETP or any
      of its Subsidiaries or any executive officer or director thereof which would
      prohibit or impair ETP from undertaking any of the transactions contemplated
      by
      this Agreement, except as would not materially affect the consummation of the
      transactions contemplated by this Agreement. ETP is not subject to any
      outstanding judgment, order, writ, injunction, decree or award entered in an
      Action to which ETP was a named party which would prohibit or impair ETP from
      undertaking any of the transactions contemplated by this Agreement, except
      as
      would not materially affect the consummation of the transactions contemplated
      by
      this Agreement. 

     

    Section
      4.7  Availability
      of Funds. ETP will have sufficient funds available to pay the purchase price
      under the CCE Acquisition Agreement on the closing date thereof and to
      consummate the transactions contemplated hereby. The ability of ETP to
      consummate the transactions contemplated under the CCE Acquisition Agreement
      and
      this Agreement is not subject to any condition or contingency with respect
      to
      financing. 

     

    Section
      4.8  Brokerage
      and Finders’ Fees. Except for Credit Suisse Securities (USA) LLC, whose fees
      will be paid by ETP, none of ETP, any of its Affiliates, or its partners,
      directors, officers or employees, has incurred, or will incur any brokerage,
      finders’ or similar fee in connection with the transactions contemplated by this
      Agreement.

     

    Section
      4.9  Investment
      Representations. 

     

    (a)  ETP
      is
      acquiring the TPC Interests to be acquired by it hereunder for its own account,
      solely for the purpose of investment and not with a view to, or for sale in
      connection with, any distribution thereof in violation of the federal securities
      laws or any applicable foreign or state securities law. 

     

    
      
        
        

      

      
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    (b)  ETP
      is an
“accredited investor” as defined in Rule 501(a) promulgated under the Securities
      Act.

     

    (c)  ETP
      understands that the acquisition of the TPC Interests to be acquired by it
      pursuant to the terms of this Agreement involves substantial risk. ETP and
      its
      officers have experience as an investor in securities and equity interests
      of
      companies such as the ones being transferred pursuant to this Agreement and
      ETP
      acknowledges that it can bear the economic risk of its investment and has such
      knowledge and experience in financial or business matters that ETP is capable
      of
      evaluating the merits and risks of its investment in the TPC Interests to be
      acquired by it pursuant to the transactions contemplated hereby.

     

    (d)  ETP
      understands that the TPC Interests to be acquired by it hereunder have not
      been
      registered under the Securities Act on the basis that the sale provided for
      in
      this Agreement is exempt from the registration provisions thereof. ETP
      acknowledges that such securities may not be transferred or sold except pursuant
      to the registration and other provisions of applicable securities laws or
      pursuant to an applicable exemption therefrom. 

     

    (e)  ETP
      acknowledges that the offer and sale of the TPC Interests to be acquired by
      it
      in the transactions contemplated hereby has not been accomplished by the
      publication of any advertisement.

     

    Section
      4.10  No
      Other Representations or Warranties.
      Except
      for the representations and warranties contained in this Article IV, neither
      ETP
      nor any other Person makes any other express or implied representation or
      warranty on behalf of ETP.

     

    ARTICLE
      V

    COVENANTS
      OF THE PARTIES

     

    Section
      5.1  Conduct
      of Business.

     

    (a)  Except
      as
      expressly provided in this Agreement or as set forth in Section 5.1(a) of the
      CCE Disclosure Letter, from and after the date of this Agreement and until
      the
      Closing Date, CCE shall use commercially reasonable efforts to cause TPC to
      conduct and maintain its business in the ordinary course of business, consistent
      with past practice.

     

    (b)  Except
      as
      contemplated by this Agreement or as set forth in Section 5.1(b) of the CCE
      Disclosure Letter, prior to the Closing Date, without the prior written consent
      of ETP (which consent shall not be unreasonably withheld or delayed), CCE shall
      cause TPC not to:

     

    (i)  Amend
      its
      organizational documents or governance documents;

     

    (ii)  Issue,
      sell, pledge, dispose of or encumber, or authorize or propose the issuance,
      sale, pledge, disposition or encumbrance of, any shares of, or securities
      convertible or exchangeable for, or options, puts, warrants, calls, commitments
      or rights of any kind to acquire, any of its membership or ownership interests
      or subdivide or in any way reclassify any membership or ownership interests
      or
      change or agree to change in any manner the rights of its outstanding membership
      or ownership interests;

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

    

     

    (iii)  (A)
      Except for the payment of a distribution of $22,000,000 to the sole member
      of
      TPC, as necessary to meet debt covenants under the Existing TW Holdings Debt
      or
      for the payment of a distribution to the sole member of TPC in order to make
      the
      distributions contemplated by Section 5.1(c) hereof, declare, set aside or
      pay
      any dividend or other distribution with respect to any shares of any class
      or
      series of equity interests of TPC; (B) split, combine or reclassify any shares
      of any class or series of capital stock of TPC; or (C) redeem, purchase or
      otherwise acquire directly or indirectly any shares of any class or series
      of
      equity interests of TPC, or any instrument or security which consists of or
      includes a right to acquire such equity interests;

     

    (iv)  Except
      as
      may be required by agreements or arrangements identified in Section 5.1(b)(iv)
      of the CCE Disclosure Letter:

     

    A.  grant
      any
      severance or termination payments;

     

    B.  enter
      into or extend or amend any employment, consulting, severance or other
      compensation agreement with, or otherwise increase the compensation or benefits
      provided to any of its officers or other employees, either individually or
      as
      part of a class of similarly situated employees other than in the ordinary
      course of business, consistent with past practice;

     

    C.  except
      as
      required by Applicable Law, amend or take any other actions, including, but
      not
      limited to, acceleration of vesting and waiver of performance criteria, with
      respect to any Employee Benefit Plan; or

     

    D.  terminate
      any TPC Employee other than for cause;

     

    (v)  Sell,
      lease, license, mortgage or otherwise dispose of any properties or assets
      material to its business, other than (A) sales made in the ordinary course
      of
      business consistent with past practice or (B) sales of obsolete or other assets
      not presently utilized in its business;

     

    (vi)  Merge
      with or into or consolidate with any other Person;

     

    (vii)  Make
      any
      change in its accounting principles, practices, estimates or methods, other
      than
      as may be required by GAAP, Applicable Law or any Governmental
      Authority;

     

    (viii)  Organize
      any new Subsidiary or acquire any capital stock of, or equity or ownership
      interest in, any other Person;

     

    (ix)  Materially
      modify or amend or terminate any Material Contract or waive, release or assign
      any material rights or Claims under a Material Contract, except in the ordinary
      course of business;

     

    (x)  Pay,
      repurchase, discharge or satisfy any of its Claims, Liabilities or obligations
      (absolute, accrued, asserted or unasserted, contingent or otherwise), other
      than
      in the ordinary course of business and consistent with past
      practice;

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

    

     

    (xi)  Enter
      into any contract or transaction relating to the purchase of assets material
      to
      TPC, other than in the ordinary course of business consistent with past
      practice;

     

    (xii)  (A)
      Incur
      or assume any short-term debt or long-term debt except for debt incurred to
      pay
      for any TPC Expansion Project Expense, any SUG Expansion Project Expense, any
      budgeted capital expenditure or the distributions contemplated by Section 5.1(c)
      hereof, (B) modify the terms of any indebtedness or other liability, other
      than
      modifications of short-term debt in the ordinary course of business, consistent
      with past practice; (C) assume, guarantee, endorse or otherwise become liable
      or
      responsible (whether directly, contingently or otherwise) for the obligations
      of
      any other Person, except as described in Section 5.1(b)(xii)(C) of the CCE
      Disclosure Letter;

     

    (xiii)  Adopt
      a
      plan of complete or partial liquidation, dissolution, restructuring,
      recapitalization or other reorganization;

     

    (xiv)  Make
      or
      change any material election in respect of Taxes, adopt or request permission
      of
      any Taxing authority to change any material accounting method in respect of
      Taxes, or enter into any closing agreement in respect of Taxes that would
      increase the Tax liability of ETP, without ETP’s written consent, which consent
      shall not be unreasonably withheld;

     

    (xv)  Other
      than routine compliance filings, make any filings or submit any documents or
      information to FERC without prior consultation with ETP;

     

    (xvi)  Enter
      into any settlement agreement related to FERC-regulated tariff rates without
      ETP’s written consent, which consent shall not be unreasonably
      withheld;

     

    (xvii)  Fail
      to
      use commercially reasonable efforts to pursue the TPC Expansion Projects;
      or

     

    (xviii)  Fail
      to
      use commercially reasonable efforts to prepare, file and defend the TPC Rate
      Case; or

     

    (xix)  Authorize
      any of, or commit or agree to take any of, the actions referred to in the
      paragraphs (i) through (xviii) above.

     

    (c)  On
      or
      prior to the Closing Date, CCE shall make cash distributions in the aggregate
      amount of $50.0 million plus all Cash Flow for the period beginning July 1,
      2006
      until the date of the closing of the CCE Acquisition, of which $25.0 million
      shall be distributed to ETP, $25.0 million shall be distributed to the Class
      A
      Members (as defined in the Second Amended and Restated LLC Agreement) and the
      balance of such Cash Flow which shall be distributed one-half to ETP and
      one-half to the Class A Members (for purposes of this definition of Cash Flow,
      Cash Flow shall be deemed to include without duplication the amount of Citrus
      Corp. cash dividends actually paid with respect to the period from July 1,
      2006
      until September 30, 2006 and an estimated amount of Citrus Corp. cash dividends
      with respect to the period from 

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

    October
      1, 2006 until the date of the closing of the CCE Acquisition using for such
      estimate 50% (i.e., CCE’s share) of Citrus Corp. net income for such
      period).

     

    (d)  CCE
      shall, or shall cause TPC to, provide to ETP copies of any filings made with
      any
      Governmental Entities after the date of this Agreement and prior to the Closing
      Date. 

     

    (e)  CCE
      shall
      use its commercially reasonable efforts to cause TPC to have a Net Working
      Capital Amount as of the Closing Date that is greater than zero but it shall
      not
      be a condition to closing that this covenant be satisfied.

     

    (f)  From
      the
      date of this Agreement until the Closing Date, CCE shall not make any cash
      distributions to its members except as specified in Section 5.1(c) or as
      specified in the Second Amended and Restated LLC Agreement.

     

    Section
      5.2  Access
      to Properties and Records.

     

    (a)  CCE
      shall, and shall cause TPC to, afford to ETP and ETP’s accountants, counsel and
      representatives full reasonable access during normal business hours throughout
      the period prior to the Closing Date (or the earlier termination of this
      Agreement pursuant to Article VII hereof) to all of the properties, books,
      contracts, commitments and records (including all environmental studies, reports
      and other environmental records and all pipeline cost-of-service and
      rate-related studies, reports and records related to TPC and, during such
      period, shall furnish to ETP all information concerning the business,
      properties, Liabilities and personnel related to TPC as ETP may request,
provided,
      however,
      that no
      investigation or receipt of information pursuant to this Section 5.2 shall
      affect any representation or warranty of CCE or the conditions to the
      obligations of ETP. To the extent not located at the offices or properties
      of
      TPC as of the Closing Date, as promptly as practicable thereafter, CCE shall
      deliver, or cause its appropriate Affiliates to deliver to ETP all of the books
      of accounts, minute books, record books and other records (including safety,
      health, environmental, maintenance and engineering records and drawings)
      pertaining to the business operations of TPC and all financial and accounting
      records related to TPC. Such
      delivery shall include all work papers, pleadings, testimony, exhibits, spread
      sheets, research, drafts, memoranda, correspondence and other documents related
      to the TPC Rate Case (“TPC
      Rate Case Work Product”).
      TPC
      Rate Case Work Product has been and will be prepared in contemplation of
      litigation, and the use of TPC Rate Case Work Product has been and will be
      under
      the control of TPC’s attorneys. Notwithstanding anything to the contrary
      contained in this Agreement, CCE shall not be obligated to provide to ETP any
      documents or records relating to litigation and regulatory matters in which
      TPC
      is involved to the extent that CCE reasonably believes such documents or records
      are subject to the attorney-client or other applicable privilege in
      circumstances in which TPC is not the sole client unless the parties
      entitled to such attorney-client or other applicable privilege shall consent
      thereto and enter into an appropriate joint defense agreement for the purpose
      of
      preservation of such attorney-client or other applicable
      privilege.

     

    (b)  The
      information contained herein, in the CCE Disclosure Letter or heretofore or
      hereafter delivered to ETP or its authorized representatives in connection
      with
      the transactions contemplated by this Agreement shall be held in confidence
      by
      ETP and its 

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

    representatives
      in accordance with the Confidentiality Agreement until the Closing Date with
      respect to information relating to TPC. Following the Closing Date, CCE shall
      keep confidential all information related to the business and properties of
      TPC
      to the same extent as ETP is obligated to keep such information confidential
      in
      accordance with the terms of the Confidentiality Agreement (without regard
      to
      the preceding sentence) prior to the Closing Date.

     

    Section
      5.3  Consents
      and Approvals. 

     

    (a)  Upon
      the
      terms and subject to the conditions of this Agreement, each of the parties
      hereto agrees to use, and will cause its Affiliates to use its commercially
      reasonable efforts to take, or cause to be taken, all actions, and to do, or
      cause to be done, all things necessary or advisable under Applicable Law and
      regulations to consummate and make effective the transactions contemplated
      by
      this Agreement as promptly as practicable including the preparation and filing
      of all forms, registrations and notices required to be filed by such party
      in
      order to consummate the transactions contemplated by this Agreement, the taking
      of all appropriate action necessary, proper or advisable to satisfy each of
      the
      conditions to Closing that are to be satisfied by that party or any of its
      Affiliates and the taking of such actions as are necessary to obtain any
      approvals, consents, orders, exemptions or waivers of Governmental Authorities
      and any other Person required to be obtained by such party in order to
      consummate the transactions contemplated by this Agreement.

     

    (b)  Each
      party shall, and shall cause their respective Affiliates to, with respect to
      a
      threatened or pending preliminary or permanent injunction or other order, decree
      or ruling or statute, rule, regulation or executive order that would adversely
      affect the ability of any party to this Agreement to consummate the transactions
      contemplated hereby or those contemplated by the CCE Acquisition Agreement,
      use
      their respective commercially reasonable best efforts to prevent the entry,
      enactment or promulgation thereof, as the case may be (including by pursuing
      any
      available appeal process). Each of ETP and CCE shall use its respective
      commercially reasonable best efforts to, and shall cause their respective
      Affiliates to use their commercially reasonable best efforts to, promptly take
      or cause to be taken all actions necessary to comply with any requests made,
      or
      conditions set, by a Governmental Authority to consummate the transactions
      contemplated by this Agreement or the CCE Acquisition Agreement. Each party
      agrees to use its commercially reasonable best efforts to procure any
      third-party consents required in the preceding sentence. Notwithstanding the
      foregoing, in no event shall the term “commercially reasonable best efforts”
require a party to agree to any divestiture, agreement, condition, restriction
      or requirement requested by any Governmental Entity to avoid the entry,
      enactment or promulgation of any threatened preliminary or permanent injunction
      or other order, decree or ruling or statute, rule, regulation or executive
      order
      that would constitute a material adverse effect on the financial condition,
      results of operations or prospects of such party and its Affiliates (including,
      with respect to ETP, TPC), taken as a whole (a “Burdensome
      Condition”).
      All
      cooperation shall be conducted in such a manner so as to preserve all applicable
      privileges.

     

    (c)  By
      the
      later of (i) the seventh Business Day after the date hereof and (ii) the fifth
      Business Day after the approval by the FCC of the transfer of control
      contemplated by the CCE Acquisition Agreement, CCE and ETP shall file
      applications with the FCC for consent to the transfer of control of CCE and
      its
      Affiliates as contemplated by this Agreement.

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

    

     

    (d)  For
      purposes of this Section 5.3, each party shall require their respective counsel
      to cooperate to the same extent as each party is required to cooperate with
      the
      other party.

     

    (e)  Without
      limiting the generality of the undertakings pursuant to this Section 5.3 and
      subject to appropriate confidentiality protections and limitations set forth
      in
      Section 5.3(b) above, CCE, ETP and their respective Affiliates shall each
      furnish to the parties to this Agreement such necessary information and
      reasonable assistance a party may request in connection with the foregoing
      and,
      upon reasonable request shall each provide counsel for the other party with
      copies of all filings made by such party or such Affiliate, and all
      correspondence between such party or such Affiliate (and its advisors) with
      any
      Governmental Authority and any other information supplied by such party and
      such
      party’s Affiliates to a Governmental Authority in connection with this Agreement
      and the transactions contemplated hereby, provided,
      however,
      that
      materials may be redacted (i) to remove references concerning the valuation
      of
      TPC, (ii) as necessary to comply with contractual arrangements and (iii) to
      remove information that is proprietary; and provided
      further,
      that
      information protected by the attorney client, work product privilege, or any
      other applicable privilege, shall be exchanged in a manner so as to preserve
      any
      such privilege. CCE and ETP agree to inform each other of all communications
      with any Governmental Authority.

     

    Section
      5.4  Further
      Assurances.
      On and
      after the Closing Date, CCE and ETP shall cooperate and use their respective
      commercially reasonable efforts to take or cause to be taken all appropriate
      actions and do, or cause to be done, all things necessary or appropriate to
      consummate and make effective the transactions contemplated hereby, including
      the execution of any additional documents or instruments of any kind, the
      obtaining of consents which may be reasonably necessary or appropriate to carry
      out any of the provisions hereof and the taking of all such other actions as
      such party may reasonably be requested to take by the other party hereto from
      time to time, consistent with the terms of this Agreement, in order to
      effectuate the provisions and purposes of this Agreement and the transactions
      contemplated hereby.

     

    Section
      5.5  Employee
      Matters. 

     

    (a) Except
      as
      provided in the following sentence, on the Closing Date, CCE shall terminate
      the
      active participation of the Affected Employees in all of the Employee Benefit
      Plans listed in Sections 3.12(a) and 3.12(b) of the CCE Disclosure Letter,
      except for (i) the Benefit Programs and Agreements listed as Items 5 and 6
      in
      Section 3.12(b) of the CCE Disclosure Letter, (ii) the TPC VEBA and (iii) the
      life and long term disability insurance coverage contemplated by Section 5.5(b).
      Prior to the Closing Date, CCE shall, or shall cause TPC to, terminate the
      TPC
      Severance Plan. CCE shall notify Affected Employees of the termination of such
      active participation and the termination of the TPC Severance Plan prior to
      the
      Closing Date. Subject to the provisions of this Agreement, after the Closing
      Date, TPC shall be solely responsible for all obligations and Liabilities with
      respect to the Benefit Programs and Agreements listed as Items 5 and 6 in
      Section 3.12(b) of the CCE Disclosure Letter, the TPC VEBA, the retiree medical
      benefits addressed in Section 5.5(e), the accrued vacation days addressed in
      Section 5.5(c), the flexible benefit plan accounts addressed in Section 5.5(h),
      and each employee benefit policy, plan, agreement or arrangement that TPC,
      ETP
      or an Affiliate of either establishes, maintains or contributes to with respect
      to the TPC Employees, on or after the 

    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

    

    Closing
      Date, and no such obligations or Liabilities shall be assumed or retained by
      CCE
      or its Affiliates. ETP shall, or shall cause TPC to, honor any continuing pay
      or
      salary obligations and any applicable legal or contractual rights to
      reinstatement with respect to all Affected Employees. Except as provided in
      the
      preceding provisions of this Section 5.5(a) and in Section 5.5(e), CCE shall
      retain all obligations or Liabilities and assets with respect to current and
      former TPC Employees and any Shared Service Employees who do not become
      Transferring Shared Service Employees in accordance with Section 5.5(g) or
      otherwise under all of the Employee Benefit Plans listed in Sections 3.12(a)
      and
      3.12(b) of the CCE Disclosure Letter and all other employee benefit plans,
      policies and arrangements of CCE and its ERISA Affiliates, and no such
      obligations or Liabilities shall be assumed or retained by ETP or its
      Affiliates, including after the transactions contemplated hereby,
      TPC.

    

    (b) Any
      Affected Employee who is unable to report to work with TPC as of the Closing
      Date due to disability shall continue to be eligible for any applicable
      long-term disability and life insurance coverage pursuant to CCE’s or PEPL’s
      long-term disability and life insurance plans until such time, if any, as such
      Affected Employee returns to active employment with TPC; provided, however,
      that
      in order to be eligible for such benefits, each such Affected Employee, pending
      approval for long-term disability benefits or return to active employment,
      must
      continue to pay all applicable long-term disability and life insurance premiums
      due following the Closing Date for such coverage. ETP shall, or shall cause
      TPC
      to, pay Affected Employees who are on short-term disability as of the Closing
      Date the short-term disability benefits that apply under the short-term
      disability program that covers the TPC Employees as of the date of this
      Agreement. Any Affected Employees who are on short-term disability as of the
      Closing Date but who subsequently transition to long-term disability shall
      be
      eligible for, and covered by, CCE’s or PEPL’s, as applicable, long-term
      disability and life insurance coverages but not ETP’s long-term disability and
      life insurance coverages, subject to the provisions of this Section 5.5(b).
      

    

    (c) For
      no
      less than one year following the Closing Date, ETP shall, and shall cause TPC
      to, provide to Affected Employees those employee benefits that are provided
      by
      ETP to its similarly situated employees except with respect to short-term
      disability benefits, as provided in Section 5.5(b). With respect to those
      employee benefit plans of TPC, ETP or their Affiliates in which Affected
      Employees may participate on or after the Closing Date (“ETP
      Plans”),
      ETP
      shall cause the ETP Plans to credit prior service of the Affected Employees
      with
      TPC, PEPL and the Affiliates of either, past or present, for purposes of
      eligibility and vesting under ETP Plans and for all purposes with respect to
      any
      vacation, sick days, severance and post-retirement medical benefits; provided,
      however, that such service need not be credited to the extent it would result
      in
      a duplication of benefits. Following the Closing Date, ETP shall, or shall
      cause
      TPC to, honor the accrued vacation days of the Affected Employees that remain
      unused as of the Closing Date to the extent such accruals are shown, either
      as
      accruals for TPC Employees or full-time equivalent employees providing services
      to TPC, on the Closing Balance Sheet. Affected Employees shall also be given
      credit for any deductible or co-insurance payment amounts payable in respect
      of
      the ETP Plan year in which the Closing Date occurs, to the extent that,
      following the Closing Date, they participate in any ETP Plan during such plan
      year for which deductibles or co-payments are required. Any preexisting
      condition restrictions and waiting period limitations that were deemed satisfied
      with respect to a particular person under 

    
      
        
        

      

      
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    any
      Employee Benefit Plan or any other benefit plan that covered a Transferring
      Shared Service Employee immediately prior to the Closing Date shall be deemed
      satisfied by ETP and its Affiliates under ETP Plans with respect to such person
      on and after the Closing Date. The provisions of this Section 5.5(c) and Section
      5.5(f) shall not alter the status of the Affected Employees as at-will employees
      of TPC or its Affiliates. Except as otherwise contemplated by this Agreement,
      the provisions of this Section 5.5(c) and Section 5.5(f) shall not affect the
      right of TPC, ETP or any of their Affiliates to amend or terminate any of their
      employee benefit plans, programs or arrangements with respect to ETP employees
      generally.

    

    (d) ETP
      shall
      be responsible for all Liabilities and obligations under the Worker Adjustment
      and Retraining Notification Act and similar foreign, state and local rules,
      statutes and ordinances resulting from the actions of ETP or TPC after the
      Closing Date. ETP agrees to hold CCE harmless in accordance with Article VIII
      for any breach of such responsibility and ETP’s indemnification of CCE in this
      regard specifically includes any Claim by the Affected Employees for back pay,
      front pay, benefits or compensatory or punitive damages, any Claim by any
      Governmental Authority for penalties regarding any issue of prior notification
      (or lack thereof) of any plant closing or mass layoff occurring after the
      Closing Date and CCE’s costs, including reasonable attorney’s fees, in defending
      any such Claims.

    

    (e) TPC
      has
      established the TPC VEBA, the assets and liabilities of which will be retained
      by TPC as of the Closing Date. TPC is or will be responsible for those
      post-retirement medical benefits described in Section 3.12(e)(vii) of the CCE
      Disclosure Letter or described in and/or valued under the CCE FAS 106 Report.
      In
      addition to the CCE FAS 106 Report, the Enron Inactive Medical Plan sets forth
      eligibility requirements relating to post-retirement medical benefits available
      to eligible current and former employees and retirees of TPC (and their eligible
      spouses, surviving spouses and dependents). The post-retirement medical benefits
      that TPC currently provides to eligible retirees (and their eligible spouses,
      surviving spouses and dependents) are described in the CCE Under Age 65 SPD
      and
      the CCE Medicare Eligible SPD. The employer subsidies that TPC currently makes
      available under cost sharing arrangements with respect to post-retirement
      medical benefits are described in the CCE FAS 106 Report as well as in a
      November 9, 2005 letter to then current TPC employees who had satisfied
      applicable age, service and hire date eligibility requirements. Both the CCE
      FAS
      106 Report and the November 9, 2005 letter describe fixed dollar per year of
      service employer subsidies for eligible post-1989 retirees (and their eligible
      spouses, surviving spouses and dependents). The CCE FAS 106 Report describes
      a
      60 percent employer subsidy for eligible pre-1990 retirees (and their eligible
      spouses, surviving spouses and dependents). True and complete copies of the
      CCE
      FAS 106 Report, the Enron Inactive Medical Plan, the CCE Under Age 65 SPD and
      the CCE Medicare Eligible SPD, as well as the November 9, 2005 letter have
      been
      provided to ETP. Effective as of the Closing Date, ETP shall, or shall cause
      TPC
      to, establish a plan to provide post-retirement medical benefits to eligible
      current and former employees and retirees of TPC (and their eligible spouses,
      surviving spouses and dependents). The eligibility requirements and employer
      subsidies under such plan shall be as described in the CCE FAS 106 Report and/or
      the Enron Inactive Medical Plan, and such eligibility requirements and employer
      subsidies shall be applied to all Affected Employees, including all Transferring
      Shared Service Employees, with such Transferring Shared Service Employees
      receiving prior service credit in accordance with the provisions of Section
      5.5(c). Any provision of this 

    
      
        
        

      

      
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    Agreement
      to the contrary notwithstanding, TPC shall, and ETP shall cause TPC to, take
      all
      actions with respect to the partition and distribution of assets and liabilities
      associated with the Enron VEBA as may be required of TPC by, or contemplated
      with respect to TPC under, any order of the Bankruptcy Court relating to the
      Enron VEBA Motion or any order of any other court of competent jurisdiction
      relating to the partition of assets held under the Enron VEBA and/or the
      distribution of liabilities associated with the Enron VEBA. For the avoidance
      of
      doubt, pursuant to the preceding sentence, TPC shall assume liabilities and
      the
      TPC VEBA shall receive certain allocated assets with respect to current and
      former employees and retirees of TPC, former employees and retirees of former
      affiliates of TPC who provided services to TPC, and their respective eligible
      spouses, surviving spouses and dependents, all in accordance with the terms
      of
      an order relating to the Enron VEBA Motion or any other order of a court of
      competent jurisdiction relating to the partition and distribution of assets
      and
      liabilities under the Enron VEBA, and all such individuals shall be eligible
      to
      participate in the post-retirement medical benefits plan established by TPC
      or
      ETP under this Section 5.5(e). Except as otherwise indicated in Section
      3.12(e)(vii) of the CCE Disclosure Letter or as otherwise required by Applicable
      Law or the provisions of a final order entered in connection with the Enron
      VEBA
      Motion or by another court of competent jurisdiction relating to the partition
      and distribution of assets and liabilities under the Enron VEBA, nothing in
      this
      Agreement shall prohibit TPC or CCE from
      exercising their respective rights as the sponsor of TPC’s post-retirement
      medical benefits program
      to amend, modify or terminate the benefits provided thereunder, whether before
      or after the Closing Date; provided, however, that between the date hereof
      and
      the Closing Date, CCE shall not amend its post-retirement medical benefits
      program to increase the benefits provided thereunder, reduce retiree
      contribution or premium rates for coverage thereunder or expand eligibility
      under such programs.

    

    (f) In
      the
      event that, on the Closing Date or during the Continuation Period, (i) the
      employment of an Affected Employee is terminated by TPC, ETP or an Affiliate
      of
      either other than For Cause, (ii) TPC, ETP or an Affiliate of either fails
      to
      provide an Affected Employee with at least the same level of Base Compensation
      as was in effect immediately prior to the Closing Date, or (iii) without the
      consent of an Affected Employee, TPC, ETP or an Affiliate of either changes
      the
      primary work location of such Affected Employee to a location that is more
      than
      50 miles away from the Affected Employee’s primary work location immediately
      prior to the Closing Date, ETP shall be responsible for and shall pay to such
      Affected Employee, in a lump sum payment, not later than sixty (60) days
      following the date of the Affected Employee’s termination of employment, the
      following severance benefits (the “Severance
      Benefits”):
      two
      (2) weeks of the Affected Employee’s Base Compensation for each full or partial
      year of service measured from the Affected Employee’s date of hire reflected in
      Section 5.5(g) of the CCE Disclosure Letter, not to exceed fifty-two (52) weeks
      of such Base Compensation; provided, however, that in no event shall such
      Severance Benefits be less than eight (8) weeks of such Base Compensation.
      The
      costs incurred directly or indirectly in connection with the termination of
      employment of any Affected Employee on or after the Closing Date shall be borne
      exclusively by ETP. ETP’s obligation to provide the Severance Benefits shall be
      subject to the Affected Employee’s execution of a release of all claims against
      TPC, ETP and the Affiliates of either, and CCE, PEPL and the Affiliates of
      either, in a form reasonably satisfactory to ETP and CCE. For purposes of this
      Section 5.5(f), “Continuation
      Period”
      shall
      mean the one-year period following the Closing Date. For purposes of this
      Section 

    
      
        
        

      

      
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    5.5,
      “For
      Cause” shall
      mean (i) the commission by the Affected Employee of a criminal or other act
      that
      causes or is reasonably likely to cause substantial economic damage to TPC
      or
      substantial injury to the business reputation of TPC, (ii) the commission by
      the
      Affected Employee of an act of fraud, theft or financial dishonesty in the
      performance of the Affected Employee’s duties on behalf of TPC, (iii) the
      continuing failure or continuing refusal of the Affected Employee to
      satisfactorily perform the duties of the Affected Employee to TPC, (iv) the
      material disregard or violation by the Affected Employee of the legal rights
      of
      any employees of TPC or of TPC’s written policies regarding harassment or
      discrimination, or (v) any other conduct materially detrimental to TPC’s
      business. For purposes of this Section 5.5(f), “Base
      Compensation”
      shall
      mean an Affected Employee’s base hourly wages or base salary, as applicable, at
      termination of employment; provided, however, that in no event shall an Affected
      Employee’s Base Compensation for purposes of calculating the Severance Benefits
      provided for under this Section 5.5(f) be less than such Affected Employee’s
      base hourly wages or base salary, as applicable, in effect as of the date of
      this Agreement. For the avoidance of doubt, two weeks of each Affected
      Employee’s Base Compensation as of the date of this Agreement is reflected in
      the “BiWkly Salary” columns in Section 5.5(g) of the CCE Disclosure
      Letter.

    

    (g) 
      Section
      5.5(g) of the CCE Disclosure Letter sets forth a list of the TPC Employees
      as of
      the date hereof, including each such TPC Employee’s current annual base
      compensation, annual bonus, job title, work location, hire date, and vacation
      balance as of the date of this Agreement, as well as two weeks of each such
      TPC
      Employee’s Base Compensation as of the date of this Agreement, as reflected in
      the “BiWkly Salary” columns, for purposes of Section 5.5(f). Also listed in
      Section 5.5(g) of the CCE Disclosure Letter, as it may be amended as
      contemplated by this Section 5.5(g), are employees of CCES or PEPL on the date
      of this Agreement, who provide services to TPC, and who are being made available
      for transfer to TPC on the date immediately preceding the Closing Date pursuant
      to the provisions of this Section 5.5(g) (“Shared
      Service Employees”).
      With
      respect to each Shared Service Employee, Section 5.5(g) of the CCE Disclosure
      Letter sets forth, as of the date hereof, such Shared Service Employee’s current
      annual base compensation, annual bonus, job title, work location, hire date,
      and
      vacation balance as of the date of this Agreement, as well as two weeks of
      each
      such Shared Service Employee’s Base Compensation as of the date of this
      Agreement, as reflected in the “BiWkly Salary” columns, for purposes of Section
      5.5(f). In the event that CCE or ETP requests that the list of Shared Service
      Employees be amended, by adding an employee to the list or deleting an employee
      from the list within the first thirty (30) days following the execution of
      this
      Agreement, the parties agree to negotiate in good faith to determine if such
      request can be accommodated. Not later than thirty (30) days following the
      execution of this Agreement, ETP may identify to CCE, in writing, not more
      than
      five (5) Shared Service Employees who shall not be transferred to TPC. Each
      Shared Service Employee not so identified by ETP shall be considered a
“Transferring
      Shared Service Employee” under
      this Agreement. All of the Transferring Shared Service Employees shall be
      transferred to TPC, and become employees of TPC, on the date preceding the
      Closing Date. CCE shall pay, or CCE shall cause CCES or PEPL, as applicable,
      to
      pay any severance costs relating to any Shared Service Employees who do not
      become Transferring Shared Service Employees under the preceding provisions
      of
      this Section 5.5(g). In accordance with the provisions of Section 5.5(f), ETP
      shall pay the Severance Benefits, if any, relating to any Shared Service
      Employees who become Transferring Shared Service Employees under the preceding
      provisions of this Section 5.5(g). ETP shall, or shall 

    
      
        
        

      

      
        33

        
          

        

      

      
        
        

      

    

    cause
      TPC
      to, pay each Affected Employee a base hourly wage or base salary, as applicable,
      that is not less than his or her base hourly wage or base salary, as applicable,
      in effect with TPC, CCES or PEPL, as applicable, immediately prior to the
      Closing Date. CCE agrees that, within the thirty (30) day period following
      the
      execution of this Agreement, neither CCES nor PEPL shall terminate the
      employment of any Shared Service Employee other than For Cause, without the
      written consent of ETP. CCE further agrees that, prior to the Closing Date,
      neither CCES nor PEPL shall terminate the employment of any Transferring Shared
      Service Employee other than For Cause, without the written consent of ETP.
      

    

    (h) As
      soon
      as administratively feasible after the Closing Date, CCE and PEPL shall transfer
      to ETP’s flexible benefits plan, an amount, in cash, equal to any health care
      and dependent care balances standing to the credit of Affected Employees under
      the CCE and PEPL flexible benefit plans (the “CCE
      Flex Plans”)
      as of
      the day immediately preceding the Closing Date, and ETP shall, or shall cause
      TPC to, reimburse Affected Employees for all eligible health and dependent
      care
      expenses that would otherwise be payable under the terms of the CCE Flex Plans
      on or after the Closing Date. As soon as administratively feasible after the
      Closing Date, CCE shall provide to ETP a list of those Affected Employees who
      have participated in the health or dependent care reimbursement accounts under
      the CCE Flex Plans, together with their elections made prior to the Closing
      Date
      with respect to such accounts, and balances standing to their credit as of
      the
      day immediately prior to the Closing Date.

    

    (i) Affected
      Employees will be eligible to participate in the Energy Transfer Partners Profit
      Sharing and 401(k) Plan (the “ETP
      401(k) Plan”)
      following the Closing Date. ETP shall take reasonable measures designed to
      facilitate the ETP 401(k) Plan’s acceptance from any Affected Employee of a
      rollover or direct rollover of all of his or her account balances under the
      CrossCountry Energy Savings Plan 001, the CrossCountry Energy Savings Plan
      002
      and/or the Southern Union Savings Plan (each a “CCE
      Defined Contribution Plan”),
      including his or her loan balances and related loan documentation under the
      CCE
      Defined Contribution Plan(s); provided that an Affected Employee shall only
      be
      permitted to roll over his or her loan balances and related loan documentation
      if the Affected Employee makes a rollover or direct rollover of all of his
      or
      her account balances under the CCE Defined Contribution Plan or Plans which
      include the Affected Employee’s outstanding loan balances. The trustee or
      recordkeeper of CCE’s Defined Contribution Plans shall transfer to the trustee
      or recordkeeper of the ETP 401(k) Plan any loan documentation for loans to
      be
      rolled over or transferred to the ETP 401(k) Plan pursuant to the provisions
      of
      this Section 5.5(i). The provisions of this Section 5.5(i) shall not be
      construed to require that any Affected Employee roll over or otherwise transfer
      his or her account balances under a CCE Defined Contribution Plan to the ETP
      401(k) Plan. CCE shall, or shall cause PEPL to, fully vest the account balances
      of all Affected Employees under the CCE Defined Contribution Plans.

    

    (j) Notwithstanding
      any provisions of the Southern Union Company Annual Incentive Plan (the
“Annual
      Incentive Plan”)
      to the
      contrary, no payment for the 2006 Plan Year (as defined in the Annual Incentive
      Plan) shall be made to any Affected Employee, and including any accelerated
      payment pursuant to Section VI of the Annual Incentive Plan), except as provided
      in this Section 5.5(j). On or before March 15, 2007, ETP shall, or shall cause
      TPC to, pay to the Affected Employees the amount determined by multiplying,
      the
      sum of the total of 

    
      
        
        

      

      
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    the
      amounts reflected in the “Amount at Midpt” column for the TPC Employees as set
      forth in Section 5.5(g) of the CCE Disclosure Letter plus the total of the
      amounts reflected in the “Amount at Midpt” column for the Shared Service
      Employees who become Affected Employees as set forth in Section 5.5(g) of the
      CCE Disclosure Letter (as it may be amended pursuant to Section 5.5(g)), by
      a
      fraction, the numerator of which is the number of completed calendar months
      in
      2006 occurring on or before the Closing Date, and the denominator of which
      is
      twelve (12). Each such Affected Employee who is employed by ETP, TPC or an
      affiliate of either on the date that the amount determined under the preceding
      sentence is paid shall receive a percentage, that is not less than nor greater
      than the percentage reflected in the individual Affected Employee’s “Target
      Bonus Range,” of such Affected Employee’s “Annual Salary” as reflected in
      Section 5.5(g) of the CCE Disclosure Letter (as it may be amended pursuant
      to
      Section 5.5(g)), multiplied by a fraction, the numerator of which is the number
      of completed calendar months in 2006 occurring on or before the Closing Date,
      and the denominator of which is twelve (12). Notwithstanding the foregoing
      provisions of this Section 5.5(j), no payments for the 2006 Plan Year under
      the
      Annual Incentive Plan shall be made to the extent that they are not accrued
      for
      the Annual Incentive Plan on the Closing Balance Sheet.

     

                                   
      (k) Until the Closing Date, CCE shall provide ETP an opportunity to particpate
      with TPC as a participating employer in discussions regarding the Enron VEBA
      Motion, including the allocation of assets and liabilities to TPC thereunder,
      and in settlement negotiations, if any, relating to any proceeding in another
      court of compentent jurisdiction relating to the partition and distribution
      of
      assets and liabilitites under the Enron VEBA.

    

     

    Section
      5.6  Tax
      Covenants.

     

    (a)  Tax
      Return Filings, Refunds, and Credits.

     

    (i)  CCE
      shall
      timely prepare and file (or cause such preparation and filing) with the
      appropriate Tax authorities all Tax Returns (including any Consolidated Income
      Tax Returns) due on or before the 30th day following the Closing Date required
      to be filed by or on behalf of TPC (and make all elections with respect to
      such
      Tax Returns) for Tax periods that end on or before the Closing Date, and CCE
      may
      timely prepare and file (or cause such preparation and filing) with the
      appropriate Tax authorities all other Tax Returns (including any Consolidated
      Income Tax Returns) required to be filed by or on behalf of TPC (and make all
      elections with respect to such Tax Returns) for Tax periods that end on or
      before the Closing Date (all such returns required to be prepared and filed
      or
      actually prepared and filed by CCE, the “CCE
      Returns”).

     

    (ii)  ETP
      shall
      timely prepare and file (or cause such preparation and filing) with the
      appropriate Tax authorities all Tax Returns (the “Straddle
      Period Returns”)
      required to be filed by or on behalf of TPC (and make all elections with respect
      to such Tax Returns) for all Tax periods ending after the Closing Date that
      include the Closing Date (the “Straddle
      Period”),
      and
      ETP shall timely prepare and file (or cause such preparation and filing) with
      the appropriate Tax authorities all Tax Returns required to be filed by or
      on
      behalf of TPC (and make all elections with respect to such Tax Returns) for
      Tax
      periods that end on or before the Closing Date, other than CCE Returns (all
      such
      returns required to be prepared and filed by ETP, the “ETP
      Returns”).
      All
      ETP Returns shall be prepared in accordance with past practice to the extent
      consistent with applicable law and the operations of TPC. ETP shall provide
      CCE
      with copies of any ETP Returns at least forty-five (45) days prior to the due
      date thereof (giving effect to any extensions thereto), accompanied by a
      statement (the “Straddle
      

     

    
      
        
        

      

      
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    Statement”)
      setting forth and calculating in reasonable detail the Pre-Closing Taxes as
      defined below. If CCE agrees with the ETP Return and Straddle Statement, the
      amount of Pre-Closing Taxes shall be as shown thereon. If, within fifteen (15)
      days of the receipt of the ETP Return and Straddle Statement, CCE notifies
      ETP
      that it disputes the manner of preparation of the ETP Return or the amount
      calculated in the Straddle Statement, and provides ETP its proposed form of
      ETP
      Return, a statement setting forth and calculating in reasonable detail the
      Pre-Closing Taxes, and a written or oral explanation of the reasons for its
      adjustment, then ETP and CCE shall attempt to resolve their disagreement within
      the five (5) days following CCE’s notification or ETP of such disagreement. If
      ETP and CCE are unable to resolve their disagreement, the dispute shall be
      submitted to a mutually agreed upon nationally recognized independent accounting
      firm, whose expense shall be borne equally by ETP and CCE, for resolution within
      twenty (20) days of such submission. The decision of such accounting firm with
      respect to such dispute shall be binding upon ETP and CCE.

     

    (iii)  From
      and
      after the Closing Date, ETP and its Affiliates (including TPC) will not file
      any
      amended Tax Return, carryback claim or other adjustment request by or on behalf
      of TPC for any Tax period that includes or ends on or before the Closing Date
      unless CCE consents in writing.

     

    (iv)  For
      purposes of this Agreement, in the case of any Taxes of TPC that are payable
      with respect to any Straddle Period, the portion of any such Taxes that
      constitutes “Pre-Closing
      Taxes”
shall
      be the excess of (A) (i) in the case of Taxes that are either (x) based upon
      or
      related to income or receipts or (y) imposed in connection with any sale,
      transfer or assignment or any deemed sale, transfer or assignment of property
      (real or personal, tangible or intangible) be deemed equal to the amount that
      would be payable if the Tax period ended at the close of business on the Closing
      Date and (ii) in the case of Taxes (other than those described in clause (i))
      imposed on a periodic basis with respect to the business or assets of TPC,
      be
      deemed to be the amount of such Taxes for the entire Straddle Period (or, in
      the
      case of such Taxes determined on an arrears basis, the amount of such Taxes
      for
      the immediately preceding Tax period) multiplied by a fraction the numerator
      of
      which is the number of calendar days in the portion of the Straddle Period
      ending on and including the Closing Date and the denominator of which is the
      number of calendar days in the entire Straddle Period over (B) any prepayment
      or
      advances of Taxes or any payments of estimated Taxes with respect to the
      Straddle Period. For purposes of clause (i) of the preceding sentence, any
      exemption, deduction, credit or other item that is calculated on an annual
      basis
      shall be allocated to the portion of the Straddle Period ending on the Closing
      Date on a pro rata basis determined by multiplying the total amount of such
      item
      allocated to the Straddle Period by a fraction, the numerator of which is the
      number of calendar days in the portion of the Straddle Period ending on the
      Closing Date and the denominator of which is the number of calendar days in
      the
      entire Straddle Period. In the case of any Tax based upon or measured by capital
      (including net worth or long-term debt) or intangibles, any amount thereof
      required to be allocated under this Section 5.6(a)(iv) shall be computed by
      reference to the level of such items at the close of business on the Closing
      Date. The parties hereto will, to the extent permitted by Applicable Law, elect
      with the relevant Tax authority to treat a portion of any Straddle Period as
      a
      short taxable period ending as of 

     

    
      
        
        

      

      
        36

        
          

        

      

      
        
        

      

    

    the
      close
      of business on the Closing Date. For purposes of this Agreement, “Post-Closing
      Taxes”
shall
      include any Taxes of TPC that are payable with respect to a Straddle Period,
      except for the portion of any such Taxes that constitutes Pre-Closing Taxes.
      For
      purposes of this Agreement, the Texas corporate franchise tax determined based
      on the income or capital of any entity for the year during which the Closing
      Date occurs shall be considered to be a Tax due with respect to the Straddle
      Period.

     

    (v)  CCE
      and
      ETP shall reasonably cooperate in preparing and filing all Tax Returns required
      to be filed by or on behalf of TPC, including maintaining and making available
      to each other all records reasonably necessary in connection with Taxes of
      TPC
      and in resolving all disputes and audits with respect to all Tax periods
      relating to Taxes of TPC.

     

    (vi)  For
      a
      period of six (6) years after the Closing Date, CCE and its representatives
      shall have reasonable access to the books and records (including the right
      to
      make extracts thereof) of TPC to the extent that such books and records relate
      to Taxes and to the extent that such access may reasonably be required by CCE
      in
      connection with matters relating to or affected by the operation of TPC prior
      to
      the Closing Date. Such access shall be afforded by ETP upon receipt of
      reasonable advance notice and during normal business hours. If ETP shall desire
      to dispose of any of such books and records prior to the expiration of such
      six-year period, ETP shall, prior to such disposition, give CCE a reasonable
      opportunity, at CCE’s expense, to segregate and remove such books and records as
      CCE may select.

     

    (vii)  If
      a Tax
      Indemnified Party receives a refund or credit or other reimbursement with
      respect to Taxes for which it was indemnified under this Agreement, the Tax
      Indemnified Party shall pay over such refund or credit or other reimbursement
      to
      the Tax Indemnifying Party.

     

    (viii)  ETP
      shall
      not, and shall cause TPC to not, make, amend or revoke any Tax election if
      such
      action would adversely affect any of CCE or its Affiliates with respect to
      any
      Tax period ending on or before the Closing Date or for the Pre-Closing Period
      or
      any Tax refund with respect thereto unless ETP and its Affiliates indemnify
      and
      make CCE and its Affiliates whole for any detriment or cost incurred (or to
      be
      incurred) by them as a result of such action.

     

    (ix)  For
      purposes of this Agreement a “Consolidated
      Income Tax Return”
is
      any
      income Tax Return filed with respect to any consolidated, combined, affiliated
      or unified group provided for under Section 1501 of the Code and the Treasury
      regulations under Section 1502 of the Code, or any comparable provisions of
      state or local law, other than any income Tax Return that includes only
      TPC.

     

    (b)  Indemnity
      for Taxes.

     

    (i)  CCE
      hereby agrees to indemnify ETP and its affiliates against and hold them harmless
      from and against all liability for (A) all Taxes that are attributable to CCE
      or
      any member of an affiliated, consolidated, combined or unitary Tax group of
      

     

    
      
        
        

      

      
        37

        
          

        

      

      
        
        

      

    

    which
      TPC
      (or any direct or indirect predecessor(s) of TPC) was a member at any time
      on or
      prior to the Closing Date and not after the Closing Date that is imposed under
      Treasury Regulation Section 1.1502-6 (or any similar provision of state, local
      or foreign Tax law), except to the extent reflected on the TPC Six Month Interim
      Financial Statements, (B) any Taxes of TPC incurred as a transferee or a
      successor relating to any full or partial Tax period ending on or before the
      Closing Date, except to the extent reflected on the TPC Six Month Interim
      Financial Statements, (C) CCE’s portion of Transfer Taxes pursuant to Section
      5.6(f), and (D) any Damages arising out of, resulting from, or incurred in
      connection with any breach or inaccuracy of any representation or warranty
      set
      forth in Section 3.16; provided,
      however,
      that
      the determination of whether such a breach or inaccuracy of Section 3.16(c),
      (d), or (e) occurred will be made without the Material Adverse Effect
      qualifications contained therein.

     

    (ii)  ETP
      hereby agrees to indemnify CCE and its Affiliates against and hold them harmless
      from all liability for (A) all Taxes of TPC with respect to all Tax periods
      beginning after the Closing Date, (B) Post-Closing Taxes with respect to any
      Straddle Period, (C) ETP’s portion of Transfer Taxes pursuant to Section 5.6(f),
      (D) all Taxes imposed on TPC with respect to Tax periods ending on or before
      the
      Closing Date, and (E) Pre-Closing Taxes with respect to any Straddle
      Period.

     

    (iii)  The
      obligation of CCE to indemnify and hold harmless ETP, on the one hand, and
      the
      obligations of ETP to indemnify and hold harmless CCE, on the other hand,
      pursuant to this Section 5.6, shall terminate upon the expiration of the
      applicable statutes of limitations with respect to the Tax Liabilities in
      question (giving effect to any waiver, mitigation or extension thereof) or
      if a
      Claim is brought with respect thereto, until such time as such Claim is
      resolved.

     

    (c)  Certain
      Payments.
      ETP and
      CCE agree to treat (and cause their Affiliates to treat) any payment by CCE
      under Section 5.6(b) as an adjustment to the property distributed by CCE to
      ETP
      in redemption of the 50% CCE Interest for all Tax purposes.

     

    (d)  Contests.

     

    (i)  After
      the
      Closing Date, CCE and ETP each shall notify the other party in writing within
      ten (10) days of the commencement of any Tax audit or administrative or judicial
      proceeding affecting the Taxes of TPC that, if determined adversely to the
      taxpayer (the “Tax
      Indemnified Party”)
      or
      after the lapse of time would be grounds for indemnification under this Section
      5.6 by the other party (the “Tax
      Indemnifying Party”
and
      a
“Tax
      Claim”).
      Such
      notice shall contain factual information describing any asserted Tax liability
      in reasonable detail and shall include copies of any notice or other document
      received from any Tax authority in respect of any such asserted Tax liability.
      Failure to give such notification shall not affect the indemnification provided
      in this Section 5.6 except to the extent the Tax Indemnifying Party shall have
      been prejudiced as a result of such failure (except that the Tax Indemnifying
      Party shall not be liable for any expenses incurred during the period in which
      the Tax Indemnified Party failed to give such notice). Thereafter, the Tax
      Indemnified Party shall deliver to the Tax Indemnifying Party, as promptly
      as
      possible but in no event later than ten (10) 

     

    
      
        
        

      

      
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    days
      after the Tax Indemnified Party’s receipt thereof, copies of all relevant
      notices and documents (including court papers) received by the Tax Indemnified
      Party. 

     

    (ii)  In
      the
      case of an audit or administrative or judicial proceeding involving any asserted
      liability for Taxes relating to any Taxable years or periods ending on or before
      the Closing Date, CCE shall have the right, at its expense, to control the
      conduct of such audit or proceeding; provided,
      however,
      that if
      CCE does not timely take control of such audit or proceeding, ETP may, at its
      expense, control the conduct of the audit or proceeding. In the case of an
      audit
      or administrative or judicial proceeding involving any asserted liability for
      Taxes relating to any Straddle Period, ETP shall have the right, at its expense,
      to control the conduct of such audit or proceeding; provided,
      however,
      that
      (A) ETP shall keep CCE reasonably informed with respect to the status of such
      audit or proceeding and provide CCE with copies of all written correspondence
      with respect to such audit or proceeding in a timely manner and (B) if such
      audit or proceeding would be reasonably expected to result in a material
      increase in Tax liability of TPC for which CCE would be liable under this
      Section 5.6, CCE may participate in the conduct of such audit or proceeding
      at
      its own expense. 

     

    (iii)  In
      the
      case of an audit or administrative or judicial proceeding involving any asserted
      liability for Taxes relating to any Taxable years or periods beginning after
      the
      Closing Date, ETP shall have the right, at its expense, to control the conduct
      of such audit or proceeding. 

     

    (iv)  ETP
      and
      CCE shall reasonably cooperate in connection with any Tax Claim, and such
      cooperation shall include the provision to the Tax Indemnifying Party of records
      and information that are reasonably relevant to such Tax Claim and making
      employees available on a mutually convenient basis to provide additional
      information and explanation of any material provided hereunder.

     

    (e)  Transfer
      and Similar Taxes.
      Notwithstanding any other provisions of this Agreement to the contrary, all
      sales, use, transfer, gains, stamp, duties, recording and similar Taxes, but
      not
      including any Federal or state income taxes (collectively, “Transfer
      Taxes”)
      incurred in connection with the transactions contemplated by this Agreement
      shall be borne equally by ETP and CCE, and CCE shall accurately file all
      necessary Tax Returns and other documentation with respect to Transfer Taxes
      and
      timely pay all such Transfer Taxes. If required by Applicable Law, ETP will
      join
      in the execution of any such Return. CCE shall provide copies of any Tax Returns
      with respect to Transfer Taxes to ETP no later than five (5) days after the
      due
      dates of such Tax Returns. 

     

    (f)  Termination
      of Tax Sharing Agreements.
      On or
      prior to the Closing Date, CCE shall cause all Tax sharing agreements between
      CCE or any of its Affiliates (as determined immediately after the Closing Date)
      on the one hand, and TPC on the other hand, to be terminated, and all
      obligations thereunder shall be settled, and no additional payments shall be
      made under any provisions thereof after the Closing Date. 

     

    Section
      5.7  Control
      of Administrative and Regulatory Proceedings.
      CCE and
      ETP agree and acknowledge that, up to the Closing Date, CCE shall be entitled
      to
      control, defend and 

     

    
      
        
        

      

      
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    otherwise
      conduct any administrative or regulatory proceeding involving TPC. CCE will
      use
      commercially reasonable efforts to, and will cause TPC to, conduct any
      administrative or regulatory proceeding in a manner that is intended to maximize
      the value of TPC on and after the Closing Date. The Parties agree and
      acknowledge that, prior to the Closing Date, ETP shall be entitled to
      participate at its expense in any administrative or regulatory proceeding,
      meeting, or settlement conference, in administrative or regulatory proceedings
      involving or affecting TPC. The Parties agree and acknowledge that, after the
      Closing Date, ETP will assume control of any administrative or regulatory
      proceeding involving or affecting TPC subject to the terms of the TPC Transition
      Services Agreement. 

     

    Section
      5.8  Maintenance
      of Insurance Policies. 

     

    (a)  CCE
      and
      ETP agree that to the extent the Insurance Policies provide coverage, CCE will
      process the Casualty Insurance Claims relating to the business of TPC (including
      reported claims and including incurred but not reported claims) and that such
      Casualty Insurance Claims shall remain with TPC following the Closing. For
      purposes hereof, “Casualty
      Insurance Claims”
shall
      mean workers’ compensation, auto liability, general liability and products
      liability claims and claims for damages caused to the facilities of TPC
      generally insured under all risk, real property, boiler and mechanical breakdown
      insurance coverage all with dates of occurrence prior to the date of Closing.
      The Casualty Insurance Claims are subject to the provisions of the Insurance
      Policies with insurance carriers and contractual arrangements with insurance
      adjusters maintained by CCE or its Affiliates prior to the Closing. With respect
      to the Casualty Insurance Claims where coverage is available under the Insurance
      Policies, the following procedures shall apply: (i) CCE or its Affiliates shall
      continue to administer, adjust, settle and pay, on behalf of TPC, all Casualty
      Insurance Claims; provided, however, that CCE will obtain the consent of ETP
      prior to adjusting, settling or paying any Casualty Insurance Claim of an amount
      greater than $100,000 and provided further, that CCE shall permit ETP to join
      CCE in any settlement negotiations with claimants, insurers, or insurance
      adjusters and (ii) CCE shall invoice TPC at the end of each month for Casualty
      Insurance Claims paid on behalf of TPC. ETP shall cause TPC to pay the invoice
      within thirty (30) days of its date. In the event that TPC does not pay CCE
      within thirty (30) days of such invoice, interest at the rate of ten percent
      (10%) per annum shall accrue on the amount of such invoice. Casualty Insurance
      Claims to be paid by CCE hereunder shall include all costs necessary to settle
      claims including compensatory, medical, legal and other allocated expenses,
      net
      of insurance proceeds. In the event that any Casualty Insurance Claims exceeds
      a
      deductible or self-insured retention under the Insurance Policies, CCE shall
      be
      entitled to the benefit of any insurance proceeds that may be available to
      discharge any portion of such Casualty Insurance Claim.

     

    (b)  After
      the
      Closing, ETP shall be responsible for, and neither CCE nor any of its Affiliates
      shall have any responsibility for, the payment of any deductible amounts or
      underlying limits attributable to the Insurance Policies for Casualty Insurance
      Claims relating to TPC. ETP acknowledges that certain of the Insurance Policies
      may require CCE or any of its Affiliates to provide an indemnity to the
      insurance carrier for deductible amounts and to provide collateral to secure
      such indemnity obligations. ETP hereby agrees to indemnify and hold harmless
      CCE
      or any of its Affiliates (as applicable) for any and all of the costs of
      maintaining such collateral and for any charges made against such collateral
      or
      indemnification payments in connection with claims arising or alleged to arise
      from the operations of TPC required to be paid 

     

    
      
        
        

      

      
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    by
      CCE of
      any of its Affiliates (as applicable) under or with respect to such Insurance
      Policies from and after the Closing Date.

     

    (c)  Other
      than as set forth in Section 3.21 hereof, CCE makes no representation or
      warranty with respect to the applicability, validity or adequacy of any
      Insurance Policies, and CCE shall not be responsible to ETP or any of its
      Affiliates for the failure of any insurer to pay under any such Insurance
      Policy.

     

    (d)  Nothing
      in this Agreement is intended to provide or shall be construed as providing
      a
      benefit or release to any insurer or claims service organization of any
      obligation under any Insurance Policies. CCE and ETP confirm that the sole
      intention of this Section 5.8 is to divide and allocate the benefits and
      obligations under the Insurance Policies between them as of the Closing Date
      and
      not to affect, enhance or diminish the rights and obligations of any insurer
      or
      claims service organization thereunder. Nothing herein shall be construed as
      creating or permitting any insurer or claims service organization the right
      of
      subrogation against CCE or ETP or any of their Affiliates in respect of payments
      made by one to the other under any Insurance Policy. 

     

    (e)  If
      ETP
      requests a copy of an Insurance Policy relating to a pending or threatened
      Casualty Insurance Claim, CCE shall provide a copy of all relevant insurance
      policies which insure such Casualty Insurance Claims within five (5) Business
      Days, provided, however, that if CCE cannot provide such policy within five
      (5)
      Business Days after exercising commercially reasonable efforts to locate such
      policy, CCE shall continue to exercise its commercially reasonable efforts
      to
      provide such policy to ETP as soon as possible thereafter. 

     

    (f)  Except
      to
      the extent specified in this Section 5.8, TPC shall not participate in any
      insurance policy or program of CCE or any of its Affiliates following the
      Closing.

     

    Section
      5.9  Preservation
      of Records.
      ETP
      agrees that it shall, at its own expense, preserve and keep the records held
      by
      it relating to the business of TPC that could reasonably be required after
      the
      Closing by CCE for as long as may be required for such categories of records
      by
      the time periods required by Applicable Law and in accordance with CCE’s
      document retention practices. In addition, ETP shall make such records available
      to CCE as may reasonably be required by CCE in connection with, among other
      things, any insurance claim, legal proceeding or governmental investigation
      relating to the respective businesses of CCE and its Affiliates, including
      TPC. 

     

    Section
      5.10  Public
      Statements. Neither party shall, nor shall permit its Affiliates to, issue
      or cause the publication of any press release or other announcement with respect
      to this Agreement or the transactions contemplated hereby without the consent
      of
      the other party hereto, unless such disclosure is required by Applicable Law,
      or
      by obligations pursuant to any agreement with any national securities exchange;
      provided,
      however,
      that
      the party intending to make such release shall give the other parties prior
      notice and shall use its commercially reasonable efforts consistent with such
      Applicable Law or obligation to consult with the other parties with respect
      to
      the text thereof. 

     

    Section
      5.11  Assignment
      of Trademarks.

     

    
      
        
        

      

      
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    (a)  Effective
      upon the Closing Date, CCE shall assign or cause to be assigned to TPC, the
      trademarks, service marks, and trade names listed on Section 5.11 of the CCE
      Disclosure Letter, together with all slogans, logotypes, designs and trade
      dress
      associated therewith, including all applications and registrations therefor,
      which are, in each case, in existence on the Closing Date and currently being
      used in the conduct of the business of TPC (collectively, the “TPC
      Marks”).
      

     

    (b)  CCE
      shall
      use commercially reasonable efforts to assist ETP in protecting and maintaining
      the rights of TPC in connection with use of the TPC Marks by TPC, including
      preparation and execution of documents necessary or appropriate in the ordinary
      course to register TPC Marks and/or record this Agreement. As between the
      parties, ETP shall have the sole right to, and in its sole discretion may,
      commence, prosecute or defend, and control any action concerning the TPC Marks.
      

     

    Section
      5.12  Commercially
      Reasonable Efforts.
      Upon
      the terms and subject to the conditions of this Agreement, each of the parties
      hereto will use, and will cause their respective Affiliates to use, all
      commercially reasonable efforts to take, or cause to be taken, all action,
      and
      to do, or cause to be done, all things necessary, proper or advisable consistent
      with Applicable Law to consummate and make effective in the most expeditious
      manner practicable the transactions contemplated hereby. 

     

    Section
      5.13  Financial
      Statements; Financial Records of CCE. 

     

    (a)  If
      Closing does not occur on or prior to September 30, 2006, then CCE shall (i)
      no
      later than November 15, 2006, prepare and deliver to ETP the CCE Nine Month
      Interim Financial Statements, (ii) no later than November 15, 2006, cause TPC
      to
      prepare and deliver to ETP the TPC Nine Month Interim Financial Statements
      and
      (iii) no later than December 1, 2006, cause Citrus to prepare and deliver to
      ETP
      the Citrus Nine Month Interim Financial Statements, and CCE shall cause the
      financial statements referred to in clauses (i), (ii) and (iii) of this sentence
      to present fairly in all material respects, in accordance with GAAP consistently
      applied, the financial condition and results of operation of CCE, Citrus and
      TPC, respectively, as of and for the periods set forth therein, subject, in
      the
      case of the CCE Nine Month Interim Financial Statements, the Citrus Nine Month
      Interim Financial Statements and the TPC Nine Month Interim Financial
      Statements, to normal recurring year-end adjustments that are not material,
      either individually or in the aggregate, and the absence of full footnote
      disclosure. If Closing does not occur on or prior to December 31, 2006, then
      CCE
      (w) no later than March 1, 2007, shall prepare and deliver to ETP the CCE 2006
      Financial Statements and the Citrus 2006 Financial Statements, and (x) no later
      than March 1, 2007, cause TPC to prepare and deliver to ETP the TPC 2006
      Financial Statements. CCE shall cause the financial statements referred to
      in
      clauses (w) and (x) of the preceding sentence to present fairly in all material
      respects, in accordance with GAAP consistently applied, the financial condition
      and results of operation of CCE, Citrus and TPC, respectively, as of and for
      the
      periods set forth therein. No later than (y) November 1, 2006, CCE shall prepare
      and deliver to ETP the CCE Stub Period Income Statements and (z) November 1,
      2006, cause TPC and Citrus to prepare and deliver to ETP the TPC Stub Period
      Financial Statements and the Citrus Stub Period Financial Statements,
      respectively. CCE shall cause the financial statements for three month periods
      referred to in 

     

    
      
        
        

      

      
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    clauses
      (y) and (z) of the preceding sentence to fairly present in all material
      respects, in accordance with GAAP consistently applied, subject to normal
      recurring year-end adjustments that are not material, either individually or
      in
      the aggregate, and the absence of full footnote disclosure, and shall cause
      the
      financial statements for one month periods referred to in clauses (y) and (z)
      of
      the preceding sentence to be prepared in a manner not inconsistent with the
      financial statements for the quarterly period from which such one month
      financial statements were taken. 

     

    (b)  CCE
      shall
      use commercially reasonable efforts, at ETP’s expense, to (i) cause the CCE
      Financial Statements, the Citrus Financial Statements and the TPC Financial
      Statements to be modified so that the CCE Financial Statements, the Citrus
      Financial Statements and the TPC Financial Statements comply in all material
      respects with the requirements of Regulation S-X, as adopted by the SEC, and
      (ii) deliver such modified financial statements to ETP (A) no later than
      November 1, 2006 in the case of the CCE Annual Financial Statements, the Citrus
      Annual Financial Statements, the TPC Annual Financial Statements, the CCE Six
      Month Interim Financial Statements, the Citrus Six Month Interim Financial
      Statements and the TPC Six Month Interim Financial Statements, (B) no later
      than
      December 15, 2006 in the case of the CCE Nine Month Interim Financial
      Statements, the Citrus Nine Month Interim Financial Statements and the TPC
      Nine
      Month Interim Financial Statements, (C) no later than March 1, 2007 in the
      case
      of the CCE 2006 Financial Statements and the Citrus 2006 Financial Statements
      and (D) no later than March 15, 2007 in the case of the TPC 2006 Financial
      Statements; provided, however, that notwithstanding the foregoing, such modified
      financial statements shall only be required to be delivered by CCE to ETP to
      the
      extent that the corresponding non-modified financial statements contemplated
      by
      Section 5.13(a) are required to be delivered by CCE to ETP.

     

    (c)  CCE
      consents to the inclusion or incorporation by reference of the CCE S-X Financial
      Statements, the Citrus S-X Financial Statements and the TPC S-X Financial
      Statements in any registration statement, report or other document of ETP or
      any
      of its Affiliates to be filed with the SEC in which ETP or such Affiliates
      reasonably determines that the CCE S-X Financial Statements, the Citrus S-X
      Financial Statements and/or the TPC S-X Financial Statements are required to
      be
      included or incorporated by reference to satisfy any rule or regulation of
      the
      SEC or to satisfy relevant disclosure obligations under the Securities Act
      or
      the Exchange Act. CCE shall use commercially reasonable efforts to cause
      PricewaterhouseCoopers LLP to consent to the inclusion or incorporation by
      reference of its audit opinion with respect to the CCE 2006 Financial
      Statements, the CCE Annual Financial Statements, the TPC 2006 Financial
      Statements, the TPC Annual Financial Statements, the Citrus 2006 Financial
      Statements and the Citrus Annual Financial Statements in any such registration
      statement, report or other document. CCE shall execute and deliver to
      PricewaterhouseCoopers LLP such representation letters, in form and substance
      customary for representation letters provided to external audit firms by
      management of the company whose financial statements are the subject of an
      audit
      or are subject of a review pursuant to Statement of Accounting Standards 100
      (Interim Financial Information) (or any successor statement related to the
      topic
      of accountants’ comfort letters), as may be reasonably requested by
      PricewaterhouseCoopers LLP, with respect to the CCE S-X Financial Statements,
      the Citrus S-X Financial Statements and the TPC S-X Financial Statements. CCE
      shall use commercially reasonable efforts to cause PricewaterhouseCoopers to
      deliver a comfort letter in form and substance customary with respect to
      offerings of securities registered under the Securities Act with respect to
      the
      CCE S-X 

     

    
      
        
        

      

      
        43

        
          

        

      

      
        
        

      

    

    Financial
      Statements, the Citrus S-X Financial Statements, the TPC S-X Financial
      Statements and financial information related to CCE, Citrus and/or TPC that
      is
      included in a prospectus or offering memorandum related to an offering of
      securities of the type for which comfort letters are customarily provided to
      the
      underwriters or initial purchasers in connection therewith. Any costs related
      to
      any of the foregoing described in Sections 5.13(b) and (c), including the
      preparation of such S-X financial statements, SAS 100 reviews, obtaining any
      consent of, or comfort letters from, PricewaterhouseCoopers LLP, shall be borne
      by ETP.

     

    (d)  CCE
      shall, and shall cause its Subsidiaries to, afford to ETP and any of its
      Affiliates, and their respective accountants, counsel and representatives full
      reasonable access during normal business hours for three years following the
      Closing Date to all financial and accounting records, and contracts and other
      documentation reasonably related thereto, of CCE and its Subsidiaries, including
      Citrus, to the extent (i) such records and other information are not part of
      the
      books and records of TPC delivered to ETP pursuant to Section 5.2(a) hereof
      and
      (ii) such records and other information is reasonably necessary for ETP and
      any
      of its Affiliates in connection with (A) the preparation of pro forma financial
      statements related to the transactions contemplated by this Agreement, (B)
      the
      preparation of any report or other filing required for compliance with federal
      or state securities laws, including prospectuses or offering memoranda relating
      to securities offerings, by ETP or any of its Affiliates, (C) a subsequent
      audit
      of the financial statements of CCE or TPC in connection with a change in
      external audit firms, (D) a subsequent restatement of the financial statements
      of the financial statements of CCE, Citrus or TPC or (E) any inquiry,
      investigation or legal proceeding by any Governmental Authority related to
      the
      financial statements of CCE, Citrus or TPC.

     

    Section
      5.14  Covenants
      Regarding the 50% CCE Interest.

     

    (a)  From
      and
      after the date of this Agreement until the closing of the transactions
      contemplated by the CCE Acquisition Agreement, ETP shall undertake its
      commercially reasonable efforts to consummate the transactions contemplated
      by
      the CCE Acquisition Agreement.

     

    (b)  From
      and
      after the closing of the transactions contemplated by the CCE Acquisition
      Agreement until Closing, ETP shall not cause or permit the 50% CCE Interest
      to
      be subject to any Encumbrances.

     

    Section
      5.15  No-Hire/Non-Solicitation.
      For a
      period of twelve (12) months following the Closing Date, neither ETP, TPC nor
      any of their Affiliates shall, directly or indirectly, hire or solicit (with
      the
      exception of any general solicitation of employment through any general
      advertising medium in the ordinary course of business for employment as an
      employee or consultant), any employee of CCE or any of its Affiliates, unless
      such employee's employment is or has been terminated by CCE and its
      Affiliates.

     

    Section
      5.16  CCE
      Executive Committee. On or immediately prior to the Closing Date, ETP shall
      cause any members of the executive committee of CCE designated by ETP to have
      (a) agreed to the appointment of successor members to such executive committee
      as designated by CCE to take office upon the Closing and (b) submitted their
      resignations as members of such executive committee effective upon the
      Closing.

     

    
      
        
        

      

      
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    Section
      5.17  Directors’
      and Officers’ Indemnification. For a period of not less than six (6) years
      after the Closing Date, ETP shall cause the certificate of formation and limited
      liability company or other organizational documents of TPC to continue to
      include the same provisions concerning the exculpation, indemnification,
      advancement of expenses to and holding harmless of, all past and present
      employees, officers, agents, managers and directors of TPC for acts or omissions
      occurring at or prior to the Closing as are contained in such documents as
      of
      the date of execution of this Agreement, and ETP shall cause TPC to honor all
      such provisions, including making any indemnification payments and expense
      advancements thereunder. In the event that any indemnifiable claim is asserted
      or made within such six (6) year period, all rights to indemnification and
      advancement of expenses in respect of such claim shall continue to the extent
      currently permitted under TPC’s certificate of formation and limited liability
      company agreement or other organizational documents until such claim is disposed
      of or all orders in connection with such claim are fully satisfied. CCE agrees
      to submit any such claims for indemnification for acts or omissions that
      occurred at or prior to the Closing by any such person to any of its applicable
      directors’ and officers’ insurance policy covering the matters that give rise to
      any such claim and CCE shall use reasonable efforts to obtain such pre-closing
      insurance coverage on behalf of TPC, if available. CCE makes no representation
      or warranty with respect to the applicability, validity or adequacy of any
      directors’ and officers’ insurance policy covering the matters specified in this
      Section 5.17 and CCE shall not be responsible to ETP or any of its Affiliates
      for the failure of any insurer to pay under any such directors’ and officers’
insurance policy.

     

    Section
      5.18  TPC
      Notes. If any of TPC’s $270,000,000 5.39% Senior Unsecured Notes due
      November 17, 2014 or $250,000,000 5.54% Senior Unsecured Notes due November
      17,
      2016 are required to be prepaid in accordance with the terms of the TPC Note
      Purchase Agreement due to a Change of Control (as defined therein) of TPC (as
      a
      result of either the transactions contemplated by this Agreement or the CCE
      Acquisition Agreement), ETP shall use its commercially reasonable best efforts
      to facilitate TPC’s refinancing of such notes (with the cooperation of CCE) and
      ETP shall bear all costs and expenses (including legal fees) associated with
      (i)
      any consent solicitation for amendments to, or waivers under, the TPC Note
      Purchase Agreement and (ii) any credit facility, bond offering or other
      financing transaction that is effected to raise funds for the repayment of
      such
      notes.

     

    ARTICLE
      VI

    CONDITIONS

     

    Section
      6.1  Mutual
      Conditions to the Closing.
      The
      respective obligations of each party to consummate the transactions contemplated
      by this Agreement shall be subject to the satisfaction or waiver of each of
      the
      following conditions at or prior to the Closing Date:

     

    (a)  All
      waiting periods applicable to the transactions contemplated by this Agreement
      under any applicable law shall have expired or been terminated, and all filings
      required by law to be made prior to Closing by CCE or ETP with, and all
      consents, approvals and authorizations required by law to be obtained prior
      to
      Closing by CCE or by ETP from, any Governmental Authority under any law in
      order
      to consummate the transactions contemplated by this Agreement shall have been
      made or obtained (as the case may be), except where the failure to make such
      filings, or to obtain any such authorizations, individually or in the aggregate,
      would 

     

    
      
        
        

      

      
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    not
      have
      a Material Adverse Effect; provided,
      however,
      if any
      consent, approval or authorization from any Governmental Authority the absence
      of which would not have a Material Adverse Effect is not obtained prior to
      or at
      the Closing and, as a result, the transfer of one or more assets, rights or
      interests is prevented at the Closing, from and after the Closing, CCE and
      ETP
      shall continue to use their commercially reasonable efforts to obtain such
      requisite consent, approval or authorization;

     

    (b)  No
      court
      of competent jurisdiction or other competent Governmental Authority shall have
      issued a statute, rule, regulation, order, decree or injunction or taken any
      other action that has the effect of restraining or enjoining the consummation
      of
      the transactions contemplated hereby or imposing a Burdensome Condition;
      and

     

    (c)  The
      FCC
      shall have granted its consent to the transfer of control contemplated by this
      Agreement. 

     

    Section
      6.2  ETP’s
      Conditions to the Closing.
      The
      obligations of ETP to consummate the transactions contemplated by this Agreement
      shall be subject to the satisfaction or waiver of each of the following
      conditions at or prior to the Closing Date: 

     

    (a)  The
      representations and warranties of CCE contained in this Agreement (A) if subject
      to any limitations as to “materiality” or “Material Adverse Effect” shall be
      true and correct at and as of the Closing Date as if made at and as of such
      time
      (except to the extent expressly made as of an earlier date, in which case as
      of
      such earlier date), and (B) if not subject to any limitations as to
“materiality” or “Material Adverse Effect,” shall be true and correct at and as
      of the Closing Date as if made at and as of such time (except to the extent
      expressly made as of an earlier date, in which case as of such earlier date)
      except where the failure of such representations and warranties to be true
      and
      correct would not, individually or in the aggregate, reasonably be expected
      to
      have a Material Adverse Effect; 

     

    (b)  CCE
      and
      its Affiliates shall have made all deliveries required under Section
      2.5;

     

    (c)  CCE
      shall
      have performed in all material respects all of its obligations required to
      be
      performed by it under this Agreement at or prior to the Closing Date, and ETP
      shall have received a certificate to such effect executed by an officer of
      CCE;

     

    (d)  ETP
      shall
      have received a properly executed statement of CCE dated as of the Closing
      Date
      and conforming to the requirements of Treasury Regulation Section
      1.1445-2(b)(2);

     

    (e)  TPC
      shall
      have been fully and unconditionally released as a guarantor of any obligations
      of CCE or any of its Affiliates (other than TPC);

     

    (f)  ETP
      shall
      have acquired the 50% CCE Interest pursuant to the CCE Acquisition
      Agreement;

     

    (g)  CCE
      shall
      have made the cash distributions as specified in Section 5.1(c);

     

    
      
        
        

      

      
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    (h)  CCE
      and
      PEPL shall have executed and delivered to ETP the TPC Transition Services
      Agreement; and

     

    (i)  all
      of
      the Existing TW Holdings Debt, including all unpaid interest and premiums,
      if
      any, shall have been repaid.

     

    Section
      6.3  CCE’s
      Conditions to the Closing.
      The
      obligations of CCE to consummate the transactions contemplated by this Agreement
      shall be subject to the satisfaction or waiver of each of the following
      conditions at or prior to the Closing Date: 

     

    (a)  The
      representations and warranties of ETP contained in this Agreement (A) if subject
      to any limitations as to “materiality” or “Material Adverse Effect,” shall be
      true and correct at and as of the Closing Date as if made at and as of such
      time
      (except to the extent expressly made as of an earlier date, in which case as
      of
      such earlier date), and (B) if not subject to any limitations as to
“materiality” or “Material Adverse Effect,” shall be true and correct at and as
      of the Closing Date as if made at and as of such time (except to the extent
      expressly made as of an earlier date, in which case as of such earlier date)
      except where the failure of such representations and warranties to be true
      and
      correct would not, individually or in the aggregate, reasonably be expected
      to
      have a material adverse effect on the ability of ETP to consummate the
      transactions contemplated by this Agreement; 

     

    (b)  ETP
      shall
      have made all deliveries required under Section 2.6;

     

    (c)  ETP
      shall
      have performed in all material respects all of its obligations required to
      be
      performed by it under this Agreement at or prior to the Closing Date, and CCE
      shall have received a certificate to such effect executed by an officer of
      ETP;

     

    (d)  CCE
      shall
      have received a properly executed statement of ETP dated as of the Closing
      Date
      and conforming to the requirements of Treasury Regulation Section
      1.1445-2(b)(2);

     

    (e)  CCE
      shall
      have obtained all approvals, consents and releases that are listed in Section
      6.3(e) of the CCE Disclosure Letter;

     

    (f)  ETP
      shall
      have acquired the 50% CCE Interest pursuant to the CCE Acquisition Agreement;
      and

     

    (g)  CCE
      shall
      have made the cash distributions as specified in Section 5.1(c);

     

    ARTICLE
      VII

    TERMINATION
      AND ABANDONMENT

     

    Section
      7.1  Termination.
      This
      Agreement may be terminated at any time prior to the Closing Date
      by:

     

    (a)  mutual
      written consent of the parties;

     

    
      
        
        

      

      
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    (b)  by
      either
      ETP or CCE, upon written notice to the other parties, if the Closing shall
      not
      have occurred on or before February 1, 2007 (the “Initial
      Termination Date”);
      provided,
      however,
      that if
      on the Initial Termination Date the conditions to closing set forth in Section
      6.1(a) and Section 6.1(b) shall not have been fulfilled but are reasonably
      capable of being fulfilled no later than March 1, 2007, then, if a written
      notice requesting an extension of the termination date has been delivered by
      either ETP to CCE, or by CCE to ETP, at any time during the ten business day
      period ending on the Initial Termination Date, the termination date shall be
      extended to March 1, 2007;

     

    (c)  by
      either
      ETP or CCE upon written notice to the other party, if any of the mutual
      conditions to the Closing set forth in Section 6.1 shall have become incapable
      of fulfillment by February 1, 2007 or March 1, 2007, as the case may be, and
      shall not have been waived in writing by the other party;

     

    (d)  by
      ETP,
      so long as ETP is not then in breach of its obligations under this Agreement,
      upon a breach of any covenant or agreement on the part of CCE set forth in
      this
      Agreement, or if any representation or warranty of CCE shall have been or become
      untrue, in each case such that the conditions set forth in Section 6.2 would
      not
      be satisfied; provided,
      however,
      that
      ETP may not terminate this Agreement if such breach or untruth is capable of
      being cured by CCE by not later than February 1, 2007 or March 1, 2007, as
      the
      case may be, through the exercise of its commercially reasonable efforts, so
      long as CCE continues to exercise such commercially reasonable efforts (until
      February 1, 2007 or March 1, 2007, as the case may be);

     

    (e)  by
      CCE,
      so long as CCE is not then in breach of its obligations under this Agreement,
      upon a breach of any covenant or agreement on the part of ETP set forth in
      this
      Agreement, or if any representation or warranty of ETP shall have been or become
      untrue, in each case such that the conditions set forth in Section 6.3 would
      not
      be satisfied; provided,
      however,
      that
      CCE may not terminate this Agreement if such breach or untruth is capable of
      being cured by ETP by not later than February 1, 2007 or March 1, 2007, as
      the
      case may be, through the exercise of its commercially reasonable efforts, so
      long as ETP continues to exercise such commercially reasonable efforts (until
      February 1, 2007 or March 1, 2007, as the case may be); and

     

    (f)  by
      either
      CCE or ETP if any Governmental Authority shall have issued an order, decree
      or
      ruling or taken any other action, which permanently restrains, enjoins or
      otherwise prohibits the transactions contemplated by this Agreement or the
      CCE
      Acquisition Agreement and which order, decree, ruling or other action is not
      subject to appeal; unless failure to consummate closing because of such action
      by the Governmental Authority is due to the failure of the party seeking to
      terminate to have fulfilled its obligations under Section 5.3 and Section
      5.4.

     

    The
      right
      of any party hereto to terminate this Agreement pursuant to this
      Section 7.1 shall remain operative and in full force and effect regardless
      of any investigation made by or on behalf of any party hereto, any Person
      controlling any such party or any of their respective officers, directors,
      representatives or agents, whether prior to or after the execution of this
      Agreement.

     

    
      
        
        

      

      
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    Section
      7.2  Effect
      of Termination.
      If this
      Agreement is terminated pursuant to Section 7.1, this Agreement (but not the
      Confidentiality Agreement) shall become void and of no effect with no liability
      on the part of any party (or any member, stockholder or representative of such
      party) to the other party hereto; provided,
      however,
      that,
      if such termination shall result from the willful (i) failure of a party to
      fulfill a condition to the performance of the obligations of the other parties,
      (ii) failure of a party to perform a material covenant hereof or (iii) breach
      by
      a party hereto of any representation or warranty or agreement contained herein,
      such party shall be fully liable for any and all liabilities and damages
      incurred or suffered by the other parties as a result of such willful failure
      or
      breach; and provided
      further,
      that
      notwithstanding the foregoing or anything else in this Agreement to the
      contrary, the provisions of this Section 7.2 and Article IX shall survive any
      termination hereof. 

     

    ARTICLE
      VIII

    SURVIVAL;
      INDEMNIFICATION

     

    Section
      8.1  Survival.

     

    (a)  The
      representations and warranties provided for in this Agreement shall survive
      the
      Closing and remain in full force and effect until the twelve-month (12)
      anniversary of this Agreement; provided
      however,
      that
      the representations and warranties set forth in Section 3.2 (Authority Relative
      to this Agreement), Section 3.3 (TPC Interests), Section 3.19 (Brokerage and
      Finders’ Fees), Section 4.2 (Authority Relative to this Agreement), Section 4.3
      (50% CCE Interests) and Section 4.8 (Brokerage and Finders’ Fees) shall survive
      indefinitely, the representations and warranties set forth in Section 3.16
      (Tax
      Matters) shall survive for a period equal to the applicable statute of
      limitations for each Tax and taxable year, the representations and warranties
      set forth in Section 3.15 (Environmental Matters) shall survive until the second
      (2nd) anniversary of the Closing Date, and the representations and warranties
      set forth in Section 3.12 (Employee Matters) shall survive for a period equal
      to
      the applicable statutes of limitations with respect to the matters described
      therein. Each covenant and agreement of CCE and ETP contained in this Agreement
      that by its terms requires performance after the Closing Date shall survive
      the
      Closing and shall remain in full force and effect until such covenant or
      agreement is fully performed.

     

    (b)  No
      Claim
      for damages or other relief of any kind (including a Claim for indemnification
      under Section 8.2 hereof) arising against an Indemnified Party out of or
      relating to this Agreement or the transactions contemplated hereby, whether
      sounding in contract, tort, breach of warranty, securities law, other statutory
      cause of action, deceptive trade practice, strict liability, product liability
      or other cause of action or theory of liability (except, in all cases Claims
      alleging fraud, intentional misrepresentation or intentional misconduct), may
      be
      brought unless suit thereon is filed, or a written notice describing the nature
      of that Claim, the theory of liability, the nature of the relief sought and
      the
      material factual assertions upon which the Claim is based is given to the other
      party, before the termination of the Survival Period.

     

    (c)  The
      survival period of each representation or warranty as provided in this Section
      8.1 is referred to herein as the “Survival
      Period.”
      Notwithstanding the foregoing, any representation or warranty that would
      otherwise terminate shall survive with respect to Damages which respect to
      which
      suit thereon is filed or of which notice describing the nature of that

     

    
      
        
        

      

      
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    Claim,
      the theory of liability, the nature of the relief sought and the material
      factual assertions upon which the Claim is based is given pursuant to this
      Agreement prior to the end of the Survival Period, until the matter is finally
      resolved and any related Damages are paid.

     

    Section
      8.2  Indemnification. 

     

    (a)  Subject
      to the limitations set forth in this Article VIII, subsequent to the Closing,
      CCE shall indemnify, defend, save and hold harmless, ETP, TPC, their respective
      successors and permitted assigns, and their shareholders, members, partners
      (general and limited), officers, directors, managers, trustees, incorporators,
      employees, agents, attorneys, consultants and representatives, and each of
      their
      heirs, executors, successors and assigns (collectively, the “ETP
      Indemnified Parties”),
      against and in respect of any and all Damages to the extent incurred by the
      ETP
      Indemnified Party arising out of, resulting from or incurred in connection
      with:

     

    (i)  any
      breach or inaccuracy of any representation or warranty of CCE contained in
      this
      Agreement; 

     

    (ii)  any
      breach by CCE of any covenant or agreement contained in this Agreement;
      and

     

    (iii)  any
      Third
      Party Claim against ETP arising out of or resulting from ETP’s indirect
      ownership interests in CrossCountry Citrus, LLC, Citrus Corp. or any
      Subsidiaries of Citrus Corp. other than for actions authorized, or intentional
      acts of omission, by ETP in its capacity as the Class B Member or by any Class
      B
      Executive Committee Member under, and as defined in, the CCE LLC Agreement.
      

     

    (b)  Subject
      to the limitations set forth in this Article VIII, subsequent to the Closing,
      ETP shall indemnify, defend, save and hold harmless, CCE and its Affiliates,
      their respective successors and permitted assigns, and their shareholders,
      members, partners (general and limited), officers, directors, managers,
      trustees, incorporators, employees, agents, attorneys, consultants and
      representatives, and each of their heirs, executors, successors and assigns
      (collectively, the “CCE
      Indemnified Parties”)
      against and in respect of any and all Damages to the extent incurred by the
      CCE
      Indemnified Party arising out of, resulting from or incurred in connection
      with:

     

    (i)  any
      breach or inaccuracy of any representation or warranty of ETP contained in
      this
      Agreement;

     

    (ii)  any
      breach by ETP of any covenant or agreement contained in this Agreement;
      and

     

    (iii)  any
      liability or obligation of TPC, whether arising before or after Closing, to
      the
      extent such liability or obligation (x) cannot be properly asserted against
      CCE
      under Section 8.2(a) or otherwise by ETP, except to the extent such liability
      or
      obligation cannot be properly asserted against CCE because of limitations under
      Section 8.2(d), and (y) do not arise as a result of any other obligation of
      CCE
      to any ETP Indemnified Party arising under this Agreement.

     

    
      
        
        

      

      
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    (c)  Any
      Person providing indemnification pursuant to the provisions of this Section
      8.2
      is referred to herein as an “Indemnifying
      Party,”
and
      any Person entitled to be indemnified pursuant to the provisions of this Section
      8.2 is referred to herein as an “Indemnified
      Party.”

     

    (d)  CCE’s
      indemnification obligations contained in Section 8.2(a)(i) shall not apply
      to
      any Claim for Damages until the aggregate of all such Damages total $15,000,000
      (the “Threshold
      Amount”),
      in
      which event CCE’s indemnity obligation contained in Section 8.2(a)(i) shall
      apply to all Claims for Damages in excess of the Threshold Amount, subject
      to a
      maximum liability to all Indemnified Parties, in the aggregate, of $75,000,000
      (the “Cap
      Amount”)
      for
      all Claims under Section 8.2(a)(i) in the aggregate; provided, however, that
      the
      limitations set forth in this sentence shall not apply with respect to CCE’s
      indemnification obligations related to breaches of the representations and
      warranties contained in Section 3.2 (Authority Relative to this Agreement)
      or
      Section 3.3 (TPC Interests); and provided further that, notwithstanding anything
      in this Agreement to the contrary, claims for indemnification relating to the
      representations and warranties contained in Section 3.12(g) will not be subject
      to the Threshold Amount or the Cap Amount and shall be independently determined
      without regard to such limitations. Damages relating to any single breach or
      series of related breaches of CCE’s representations and warranties shall not
      constitute Damages, and therefore shall not be applied towards the Threshold
      Amount or be indemnifiable hereunder, unless such Damages relating to any single
      breach or series of related breaches exceed $300,000 (the “Minimum
      Claim Amount”).

     

    (e)  ETP’s
      indemnification obligations contained in Section 8.2(b)(i) shall not apply
      to
      any Claim for Damages until the aggregate of all such Damages equals the
      Threshold Amount, in which event ETP’s indemnification obligation contained in
      Section 8.2(b)(i) shall apply to all Claims for Damages in excess of the
      Threshold Amount, subject to a maximum liability to all Indemnified Parties,
      in
      the aggregate, of the Cap Amount for all Claims under Section 8.2(b)(i) in
      the
      aggregate; provided,
      however,
      that
      the limitations set forth in this sentence shall not apply with respect to
      ETP’s
      indemnification obligations related to breaches of the representations and
      warranties contained in Section 4.2 (Authority Relative to this Agreement)
      or
      Section 4.3 (50% CCE Interests). Damages relating to any single breach or series
      of related breaches of ETP’s representations and warranties shall not constitute
      Damages, and therefore shall not be applied towards the Threshold Amount or
      be
      indemnifiable hereunder, unless such Damages relating to any single breach
      or
      series of related breaches exceeds the Minimum Claim Amount.

     

    (f)  The
      indemnification obligations of each party hereto under this Section 8.2 shall
      inure to the benefit of the ETP Indemnified Parties and CCE Indemnified Parties,
      and such ETP Indemnified Parties and CCE Indemnified Parties will be obligated
      to keep and perform the obligations imposed on an Indemnified Party by this
      Section 8.2, on the same terms as are applicable to such other
      party.

     

    (g)  In
      all
      cases in which a Person is entitled to be indemnified in accordance with this
      Agreement, such Indemnified Party shall be under a duty to take all commercially
      reasonable measures to mitigate all losses. Without limiting the foregoing,
      each
      Indemnified Party shall use its commercially reasonable efforts to collect
      any
      amount available under 

     

    
      
        
        

      

      
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    insurance
      coverage, or from any other Person alleged to be responsible, for any Damages
      for which an indemnity claim is being made; provided,
      however,
      that
      the reasonable costs incurred by the Indemnified Party in taking such measures
      shall be included in the amount of any Claim.

     

    (h)  An
      Indemnified Party shall not be entitled under this Agreement to multiple
      recovery for the same losses. If an Indemnified Party receives any amount under
      applicable insurance policies, or from any other Person alleged to be
      responsible for any Damages, subsequent to an indemnification payment by the
      Indemnifying Party, then such Indemnified Party shall promptly reimburse the
      Indemnifying Party for any payment made or expense incurred by such Indemnifying
      Party in connection with providing such indemnification payment up to the amount
      received by the Indemnified Party, net of any expenses incurred by such
      Indemnified Party in collecting such amount.

     

    (i)  All
      amounts paid by CCE or ETP, as the case may be, under this Article VIII shall
      be
      treated as adjustments to the property distributed by CCE to ETP in redemption
      of the 50% CCE Interest for all Tax purposes. 

     

    (j)  Notwithstanding
      any other provision in the Agreement to the contrary, this Section 8.2 shall
      not
      apply to any Claim of indemnification with respect to Tax matters. Claims for
      indemnification with respect to Tax matters shall be governed by Section 5.6.
      

     

    (k)  For
      purposes of this Article VIII only, the existence of a breach of a
      representation or warranty in this Agreement and the calculation of Damages
      arising out of a breach of any representation or warranty in this Agreement
      shall be determined without giving effect to any exception or qualification
      of
      such representation or warranty as to the materiality of the breach thereof
      or
      the Material Adverse Effect on any Person of such breach. 

     

    Except
      as
      provided in Section 5.6 hereof, the provisions of this Article VIII shall
      constitute the sole and exclusive remedy of any Indemnified Party for Damages
      arising out of, resulting from or incurred in connection with any inaccuracy
      in
      any representation or the breach of any warranty made by ETP, on the one hand,
      or CCE, on the other hand, in this Agreement; provided,
      however,
      that
      this exclusive remedy for Damages does not preclude a party from bringing an
      Action for specific performance or other equitable remedy to require a party
      to
      perform its obligations under this Agreement; provided further, that this
      exclusive remedy for Damages does not preclude a party from bringing an Action
      alleging fraud, intentional misrepresentation or intentional misconduct without
      reference to the provisions of this Article VIII. 

     

    Section
      8.3  Calculation
      of Damages.
      The
      Damages suffered by any Indemnified Party shall be calculated after giving
      effect to the actual receipt of any available insurance proceeds paid directly
      to the Indemnified Party. In computing the amount of any insurance proceeds,
      such insurance proceeds shall be reduced by a reasonable estimate of the present
      value of future premium increases attributable to the payment of such
      Claim.

     

    Section
      8.4  Procedures
      for Third-Party Claims. 

     

    (a)  In
      the
      case of any Claim for indemnification arising from a Claim of a third party
      against an Indemnified Party arising under paragraph 8.2(a) or 8.2(b) as the
      case may 

     

    
      
        
        

      

      
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    be
      (a
“Third-Party
      Claim”),
      an
      Indemnified Party shall give prompt written notice to the Indemnifying Party
      of
      any Claim or demand of which such Indemnified Party has knowledge, and as to
      which it may request indemnification hereunder, specifying (to the extent known)
      the amount of such Claim and any relevant facts and circumstances relating
      thereto; provided,
      however,
      that
      any failure to give such prompt notice or to provide any such facts and
      circumstances will not waive any rights of the Indemnified Party, except to
      the
      extent that the rights of the Indemnifying Party are actually materially
      prejudiced thereby. The Indemnifying Party shall have the right (and, if it
      elects to exercise such right, to do so by written notice within thirty (30)
      days after receiving notice from the Indemnified Party) to defend and to direct
      the defense against any such Third-Party Claim, in its name or in the name
      of
      the Indemnified Party, as the case may be, at the expense of the Indemnifying
      Party, and with counsel selected by the Indemnifying Party and reasonably
      satisfactory to the Indemnified Party, unless (i) the Indemnifying Party shall
      not have taken any action to defend such Third-Party Claim within such thirty
      (30) day period, or (ii) the Indemnified Party shall have reasonably concluded
      that there is a conflict of interest between the Indemnified Party and the
      Indemnifying Party in the conduct of the defense of such Third-Party Claim.
      Notwithstanding anything in this Agreement to the contrary (other than the
      last
      sentence of this Section 8.4(a)), the Indemnified Party, at the expense of
      the
      Indemnifying Party (which shall include only reasonable out-of-pocket expenses
      actually incurred), shall cooperate with the Indemnifying Party and keep the
      Indemnifying Party fully informed in the defense of such Third-Party Claim.
      The
      Indemnified Party shall have the right to participate in the defense of any
      Third-Party Claim with counsel employed at its own expense; provided,
      however,
      that in
      the case of any Third-Party Claim (A) described in clause (ii) above, or (B)
      as
      to which the Indemnifying Party shall not in fact have employed counsel to
      assume the defense of such Third-Party Claim within such thirty-day (30-day)
      period, or (C) that involves assertion of criminal liability on the Indemnified
      Party, or (D) seeks to force the Indemnified Party to take (or prevent the
      Indemnified Party from taking) any action, then in each such case the
      Indemnified Party shall have the right, but not the obligation, to conduct
      and
      control the defense thereof for the account of, and at the risk of, the
      Indemnifying Party, and the reasonable fees and disbursements of such
      Indemnified Party’s counsel shall be at the expense of the Indemnifying Party.
      Except as provided in the last sentence of Section 8.4(b), the Indemnifying
      Party shall have no indemnification obligations with respect to any Third-Party
      Claim which shall be settled by the Indemnified Party without the prior written
      consent of the Indemnifying Party, which consent shall not be unreasonably
      withheld, delayed or conditioned. 

     

    (b)  The
      Indemnifying Party, if it has assumed the defense of any Third Party Claim
      as
      provided in this Agreement, shall not consent to a settlement of, or the entry
      of any judgment arising from, any such Third-Party Claim without the Indemnified
      Party’s prior written consent (which consent shall not be unreasonably withheld,
      delayed or conditioned) unless (i) such settlement or judgment relates solely
      to
      monetary damages, and (ii) prior to consenting to such settlement or such entry
      of judgment, the Indemnifying Party delivers to the Indemnified Party a writing
      (in form reasonably acceptable to the Indemnified Party) which unconditionally
      provides that, subject to the provisions of Section 8.2(d) or Section 8.2(e),
      as
      appropriate, relating to the Minimum Claim Amount, the Threshold Amount and
      the
      Cap Amount, the Damages represented thereby are the responsibility of the
      Indemnifying Party pursuant to the terms of this Agreement and that, subject
      to
      the provisions of the Threshold Amount, the Indemnifying Party shall pay all
      Damages associated therewith in accordance with the terms of this Agreement.
      The
      Indemnifying Party shall not, without the Indemnified Party’s prior written

     

    
      
        
        

      

      
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    consent,
      enter into any compromise or settlement that (x) commits the Indemnified Party
      to take, or to forbear to take, any action or (y) involves a reasonable
      likelihood of an imposition of criminal liability on the Indemnified Party,
      or
      (z) does not provide for a complete release by such third party of the
      Indemnified Party. With the written consent of the Indemnifying Party, which
      consent shall not be unreasonably withheld, conditioned or delayed, the
      Indemnified Party shall have the sole and exclusive right to settle any
      Third-Party Claim, on such terms and conditions as it deems reasonably
      appropriate, to the extent such Third-Party Claim involves equitable or other
      nonmonetary relief against the Indemnified Party or involves a reasonable
      likelihood of an imposition of criminal liability on the Indemnified Party,
      and
      shall have the right to settle any Third-Party Claim involving money damages
      for
      which the Indemnifying Party has not assumed the defense pursuant to this
      Section 8.4. 

     

    Section
      8.5  Procedures
      for Inter-Party Claims.
      In the
      event that an Indemnified Party determines that it has a Claim for Damages
      against an Indemnifying Party hereunder (other than as a result of a Third-Party
      Claim), the Indemnified Party shall give prompt written notice thereof to the
      Indemnifying Party, specifying the amount of such Claim and any relevant facts
      and circumstances relating thereto, and such notice shall be promptly given
      even
      if the nature or extent of the Damages is not then known. The notification
      shall
      be subsequently supplemented within a reasonable time as additional information
      regarding the Claim or the nature or extent of Damages resulting therefrom
      becomes available to the Indemnified Party. Any failure to give such prompt
      notice or supplement thereto or to provide any such facts and circumstances
      will
      not waive any rights of the Indemnified Party, except to the extent that the
      rights of the Indemnifying Party are actually materially prejudiced thereby.
      The
      Indemnified Party and the Indemnifying Party shall negotiate in good faith
      for a
      thirty-day (30-day) period regarding the resolution of any disputed Claims
      for
      Damages. Promptly following the final determination of the amount of any Damages
      claimed by the Indemnified Party, the Indemnifying Party, subject to the
      limitations of the Minimum Claim Amount, Threshold Amount and the Cap Amount,
      shall pay such Damages to the Indemnified Party by wire transfer or check made
      payable to the order of the Indemnified Party. 

     

    ARTICLE
      IX

    MISCELLANEOUS
      PROVISIONS

     

    Section
      9.1  Interpretation.
      Unless
      the context of this Agreement otherwise requires, (a) words of any gender
      include the other gender; (b) words using the singular or plural number also
      include the plural or singular number, respectively; (c) the terms “hereof,”
“herein,” “hereby” and derivative or similar words refer to this entire
      Agreement; (d) the terms “Article,” “Section” and “Exhibit” refer to the
      specified Article, Section and Exhibit of this Agreement, respectively; and
      (e)
“including,” shall mean “including, but not limited to.” Unless otherwise
      expressly provided, any agreement, instrument, law or regulation defined or
      referred to herein means such agreement, instrument, law or regulation as from
      time to time amended, modified or supplemented, including (in the case of
      agreements or instruments) by waiver or consent and (in the case of a law or
      regulation) by succession of comparable successor law and includes (in the
      case
      of agreements or instruments) references to all attachments thereto and
      instruments incorporated therein. 

     

    
      
        
        

      

      
        54

        
          

        

      

      
        
        

      

    

    

     

    Section
      9.2  Disclosure
      Letter. The CCE Disclosure Letter is incorporated into this Agreement by
      reference and made a part hereof.

     

    Section
      9.3  Payments.
      All payments set forth in this Agreement and Exhibits are in United States
      Dollars. Such payments shall be made by wire transfer of immediately available
      funds or by such other means as the parties to such payment shall
      designate. 

     

    Section
      9.4  Expenses.
      Except as expressly set forth in Section 7.2 and in this Section 9.4, or as
      agreed upon in writing by the parties, whether or not the transactions
      contemplated hereby are consummated, each party shall bear its own costs, fees
      and expenses, including the expenses of its Representatives, incurred by such
      party in connection with this Agreement and the Related Agreements and the
      transaction contemplated hereby and thereby; provided,
      however,
      that
      CCE shall be solely responsible for all legal, accounting and other fees, costs
      and expenses incurred by CCE, and TPC in connection with the negotiation,
      execution and closing of this Agreement. 

     

    Section
      9.5  Choice
      of Law. This Agreement shall be governed by and construed in accordance with
      the law of the State of New York (regardless of the laws that might otherwise
      govern under applicable New York principles of conflicts of law).

     

    Section
      9.6  Assignment.
      This Agreement may not be assigned by either party without the prior written
      consent of the other party; provided,
      however,
      that
      without the prior written consent of the other party, each party shall have
      the
      right to assign its rights and obligations under this Agreement to any third
      party successor to all or substantially all of its entire business. This
      Agreement shall be binding upon and, subject to the terms of the foregoing
      sentence, inure to the benefit of the parties hereto and their successors,
      legal
      representatives and assigns. 

     

    Section
      9.7  Notices.
      All demands, notices, consents, approvals, reports, requests and other
      communications hereunder must be in writing, will be deemed to have been duly
      given only if delivered personally or by facsimile transmission (with
      confirmation of receipt) or by an internationally-recognized express courier
      service or by mail (first class, postage prepaid) to the parties at the
      following addresses or telephone or facsimile numbers and will be deemed
      effective upon delivery; provided,
      however,
      that
      any communication by facsimile shall be confirmed by an
      internationally-recognized express courier service or regular mail. 

     

    (i)  If
      to
      CCE:

     

    c/o
      Southern Union Company

    5444
      Westheimer Road

    Houston,
      Texas 77056

    Attention:
      Julie H. Edwards, 

    SVP
      and
      CFO

    Facsimile:
      (713) 989-1166

    
      
        
        

      

      
        55

        
          

        

      

      
        
        

      

    

    

    

     

    With
      a
      required copy (which shall not constitute notice to CCE) to:

    

    Southern
      Union Company

    5444
      Westheimer Road

    Houston,
      Texas 77056

    Attention:
      Monica M. Gaudiosi,

    SVP
      and
      Associate General Counsel

    Facsimile:
      (713) 989-1213

    

    And
      a
      required copy (which shall not constitute notice to CCE) to:

    

    Fleischman
      and Walsh, L.L.P.

    1919
      Pennsylvania Avenue, NW, Suite 600

    Washington,
      DC 20006

    Attention:
      Seth M. Warner

    Facsimile:
      (202) 265-5706

    

     

    (ii)  If
      to
      ETP:

     

    Energy
      Transfer Partners, L.P.

    8801
      South Yale Avenue

    Tulsa,
      Oklahoma 74137

    Attention:
      Robert A. Burk

    Vice
      President and General Counsel

    Facsimile:
      (918) 493-7290

    

    And
      a
      required copy (which shall not constitute notice to ETP) to:

    

    Vinson
      & Elkins L.L.P.

    1001
      Fannin Street

    2300
      First City Tower

    Houston,
      Texas 77002

    Attention:
      Thomas P. Mason, Esq.

    Telephone:
      (713) 758-4539

    Facsimile:
      (713) 615-5320

    

     

    or
      to
      such other address as the addressee shall have last furnished in writing in
      accord with this provision to the addressor. 

     

    Section
      9.8  Consent
      to Jurisdiction.
      Each
      party shall maintain at all times a duly appointed agent in the State of New
      York, which may be changed upon ten (10) Business Days’ notice to the other
      party, for the service of any process or summons in connection with any issue,
      litigation, action or proceeding brought in any such court. Any such process
      or
      summons may also be served on it by mailing a copy of such process or summons
      to
      it at its address set forth, and in the manner provided, in Section 9.7. Each
      party hereby irrevocably consents to the 

     

    
      
        
        

      

      
        56

        
          

        

      

      
        
        

      

    

    exclusive
      personal jurisdiction and venue of any New York State court located in the
      Borough of Manhattan or to any United States Federal court of competent
      jurisdiction located in the Southern District of the State of New York, in
      any
      action, Claim or proceeding arising out of or in connection with this Agreement
      and agrees not to commence or prosecute any action, Claim or proceeding in
      any
      other court. Each of the parties hereby expressly and irrevocably waives and
      agrees not to assert the defense of lack of personal jurisdiction, forum non
      conveniens or any similar defense with respect to the maintenance of any such
      action or proceeding in New York.

     

    Section
      9.9  No
      Right of Setoff. Neither party hereto nor any Affiliate thereof may deduct
      from, set off, holdback or otherwise reduce in any manner whatsoever against
      any
      amounts such Persons may owe to the other party hereto or any of its Affiliates
      any amounts owed by such Persons to the other party or its
      Affiliates. 

     

    Section
      9.10  Time
      is of the Essence. Time is of the essence in the performance of the
      provisions of this Agreement.

     

    Section
      9.11  Specific
      Performance. The parties hereto agree that irreparable damage would occur in
      the event that any provision of this Agreement was not performed in accordance
      with the terms hereof and that the parties shall be entitled to specific
      performance of the terms hereof, in addition to any other remedy at law or
      equity, subject to the limitations set forth in Section 7.2 of this
      Agreement. 

     

    Section
      9.12  Entire
      Agreement. This Agreement, together with the CCE Disclosure Letter, the
      Exhibits hereto and the Confidentiality Agreement constitute the entire
      agreement between the parties hereto with respect to the subject matter herein
      and supersede all previous agreements, whether written or oral, relating to
      the
      subject matter of this Agreement and all prior drafts of this Agreement, all
      of
      which are merged into this Agreement. No prior drafts of this Agreement and
      no
      words or phrases from any such prior drafts shall be admissible into evidence
      in
      any action or suit involving this Agreement. In case of any material conflict
      between any provision of this Agreement and any other such document, this
      Agreement shall take precedence.

     

    Section
      9.13  Third
      Party Beneficiaries. Except as expressly provided in Article VIII hereof,
      none of the provisions of this Agreement shall be for the benefit of or
      enforceable by any third party, including any creditor of any party or any
      of
      their affiliates. Except as expressly provided in Article VIII hereof, no such
      third party shall obtain any right under any provision of this Agreement or
      shall by reasons of any such provision make any Claim in respect of any
      Liability (or otherwise) against either party hereto. 

     

    Section
      9.14  Counterparts.
      This Agreement may be executed in two or more counterparts, which, when
      executed, shall be deemed to be an original and which together shall constitute
      one and the same document. 

     

    Section
      9.15  Severability.
      If any provision of this Agreement is held to be illegal, invalid or
      unenforceable under any applicable present or future law, and if the rights
      or
      obligations of either party under this Agreement will not be materially and
      adversely affected thereby, (i) such provision shall be fully severable, (ii)
      this Agreement shall be construed and enforced as if such illegal, invalid
      or
      unenforceable provision had never comprised a part hereof, 

     

    
      
        
        

      

      
        57

        
          

        

      

      
        
        

      

    

    (iii)
      the
      remaining provisions of this Agreement shall remain in full force and effect
      and
      shall not be affected by the illegal, invalid or unenforceable provision or
      by
      its severance herefrom and (iv) in lieu of such illegal, invalid or
      unenforceable provision, there shall be added automatically as a part of this
      Agreement, a legal, valid and enforceable provision as similar in terms to
      such
      illegal, invalid or unenforceable provision as may be possible. 

     

    Section
      9.16  Headings.
      The headings used in this Agreement have been inserted for convenience of
      reference only and do not define or limit the provisions hereof.

     

    Section
      9.17  Waiver.
      Any term or condition of this Agreement may be waived at any time by the party
      that is entitled to the benefit thereof, but no such waiver shall be effective
      unless set forth in a written instrument duly executed by or on behalf of the
      party or parties waiving such term or condition. No waiver by any party of
      any
      term or condition of this Agreement, in any one or more instances, shall be
      deemed to be or construed as a waiver of the same or any other term or condition
      of this Agreement on any future occasion. All remedies, either under this
      Agreement or by law or otherwise afforded, will be cumulative and not
      alternative. 

     

    Section
      9.18  Amendment.
      This Agreement may be altered, amended or changed only by a writing making
      specific reference to this Agreement and signed by duly authorized
      representatives of each party. 

     

    

     

    

     

    IN
      WITNESS WHEREOF, CCE and ETP, by their duly authorized officers, have executed
      this Agreement as of the date first written above. 

     

    ENERGY
      TRANSFER PARTNERS, L.P.

     

    
      	 	
              By:

            	
              Energy
                Transfer Partners GP, L.P., its general
                partner

            

    

     

    
      	 	
              By:

            	
              Energy
                Transfer Partners, L.L.C., its general
                partner

            

    

     

    

     

    By:/s/
      KELCY WARREN     

    Name: 
      Kelcy Warren

    Title: 
      Co-Chief Executive Officer

    

     

    CCE
      HOLDINGS, LLC

     

    

     

    By:
      /s/ DREW FOSSUM 

    Name: 
      Drew Fossum

    Title: 
      Senior Vice President & Chief Legal Officer

     

    

     

    

     

    

     

    

     

    

     

    

     

    

     

    

     

    

     

    

     

    

     

    

     

    Signature
      Page to Redemption Agreement

     

    
      
        
        

      

      
        58

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