Document:

exv4w2

Exhibit 4.2

EXECUTION COPY

ENERGY TRANSFER PARTNERS, L.P.,

as Issuer,

and

U.S. BANK NATIONAL ASSOCIATION

(AS SUCCESSOR TO

WACHOVIA BANK, NATIONAL ASSOCIATION),

as Trustee

SEVENTH SUPPLEMENTAL INDENTURE

Dated as of December 23, 2008

to

Indenture dated as of January 18, 2005

9.70% Senior Notes due 2019

 

 

Table of Contents

	 	 	 	 	 
	ARTICLE I DEFINITIONS
	 	 	1	 
	SECTION 1.1 Generally
	 	 	1	 
	SECTION 1.2 Definition of Certain Terms
	 	 	2	 
	 
	 	 	 	 
	ARTICLE II GENERAL TERMS OF THE NOTES
	 	 	6	 
	SECTION 2.1 Form
	 	 	6	 
	SECTION 2.2 Title, Amount and Payment of Principal and Interest
	 	 	7	 
	SECTION 2.3 Transfer and Exchange
	 	 	7	 
	 
	 	 	 	 
	ARTICLE III FUTURE SUBSIDIARY GUARANTEES
	 	 	8	 
	SECTION 3.1 No Initial Guarantee of the Notes by Subsidiary Guarantors
	 	 	8	 
	SECTION 3.2 Future Subsidiary Guarantors
	 	 	8	 
	SECTION 3.3 Release of Guarantees
	 	 	8	 
	SECTION 3.4 Reinstatement of Guarantees
	 	 	8	 
	 
	 	 	 	 
	ARTICLE IV REDEMPTION
	 	 	8	 
	SECTION 4.1 Redemption
	 	 	8	 
	 
	 	 	 	 
	ARTICLE V ADDITIONAL COVENANTS
	 	 	9	 
	SECTION 5.1 Limitation on Liens
	 	 	9	 
	SECTION 5.2 Restriction on Sale-Leasebacks
	 	 	10	 
	 
	 	 	 	 
	ARTICLE VI ADDITIONAL EVENT OF DEFAULT
	 	 	10	 
	SECTION 6.1 Additional Event of Default
	 	 	10	 
	 
	 	 	 	 
	ARTICLE VII REPURCHASE AT THE OPTION OF HOLDER
	 	 	11	 
	SECTION 7.1 Repurchase of Notes
	 	 	11	 
	SECTION 7.2 Exercise of Repurchase Option
	 	 	11	 
	SECTION 7.3 Notes Repurchased in Part
	 	 	11	 
	SECTION 7.4 Compliance with Exchange Act
	 	 	12	 
	 
	 	 	 	 
	ARTICLE VIII MISCELLANEOUS PROVISIONS
	 	 	12	 
	SECTION 8.1 Ratification of Base Indenture
	 	 	12	 
	SECTION 8.2 Trustee Not Responsible for Recitals
	 	 	12	 
	SECTION 8.3 Table of Contents, Headings, etc
	 	 	12	 
	SECTION 8.4 Counterpart Originals
	 	 	12	 
	SECTION 8.5 Governing Law
	 	 	12	 

 

 

     THIS SEVENTH SUPPLEMENTAL INDENTURE dated as of December 23, 2008 (the “Seventh Supplemental
Indenture”), is among Energy Transfer Partners, L.P., a Delaware limited partnership (the
“Partnership”), and U.S. Bank National Association, a national banking association, as successor to
Wachovia Bank, National Association, a national banking association, as trustee (the “Trustee”).

RECITALS:

     WHEREAS, the Partnership and certain Subsidiary Guarantors have executed and delivered to the
Trustee an Indenture, dated January 18, 2005 (the “Base Indenture” and as supplemented by this
Seventh Supplemental Indenture, the “Indenture”), providing for the issuance by the Partnership
from time to time of its debentures, notes, bonds or other evidences of indebtedness to be issued
in one or more series unlimited as to principal amount (the “Debt Securities”);

     WHEREAS, the Partnership has duly authorized and desires to cause to be established pursuant
to the Base Indenture and this Seventh Supplemental Indenture a new series of Debt Securities
designated the “9.70% Senior Notes due 2019” (the “Notes”);

     WHEREAS, Sections 2.01 and 2.04 of the Base Indenture permit the execution of indentures
supplemental thereto to establish the form and terms of Debt Securities of any series;

     WHEREAS, pursuant to Section 9.01 of the Base Indenture, the Partnership has requested that
the Trustee join in the execution of this Seventh Supplemental Indenture to establish the form and
terms of the Notes;

     WHEREAS, all things necessary have been done to make the Notes, when executed by the
Partnership and authenticated and delivered hereunder and under the Base Indenture and duly issued
by the Partnership, the valid obligations of the Partnership, and to make this Seventh Supplemental
Indenture a valid agreement of the Partnership enforceable in accordance with its terms.

     NOW, THEREFORE, the Partnership and the Trustee hereby agree that the following provisions
shall supplement the Base Indenture:

ARTICLE I

DEFINITIONS

SECTION 1.1 Generally.

     (a) Capitalized terms used herein and not otherwise defined herein shall have the respective
meanings ascribed thereto in the Base Indenture.

     (b) The rules of interpretation set forth in the Base Indenture shall be applied hereto as if
set forth in full herein.

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SECTION 1.2 Definition of Certain Terms.

     For all purposes of this Seventh Supplemental Indenture, except as otherwise expressly
provided or unless the context otherwise requires, the following terms shall have the following
respective meanings:

     “Attributable Indebtedness,” when used with respect to any Sale-Leaseback Transaction (as
defined in Section 5.2 hereof), means, as at the time of determination, the present value
(discounted at the rate set forth or implicit in the terms of the lease included in such
transaction) of the total obligations of the lessee for rental payments (other than amounts
required to be paid on account of property taxes, maintenance, repairs, insurance, assessments,
utilities, operating and labor costs and other items that do not constitute payments for property
rights) during the remaining term of the lease included in such Sale-Leaseback Transaction
(including any period for which such lease has been extended). In the case of any lease that is
terminable by the lessee upon the payment of a penalty or other termination payment, such amount
shall be the lesser of the amount determined assuming termination upon the first date such lease
may be terminated (in which case the amount shall also include the amount of the penalty or
termination payment, but no rent shall be considered as required to be paid under such lease
subsequent to the first date upon which it may be so terminated) or the amount determined assuming
no such termination.

     “Comparable Treasury Issue” means the United States Treasury security selected by the
Independent Investment Banker as having a maturity comparable to the remaining term of the Notes to
be redeemed that would be utilized, at the time of selection and in accordance with customary
financial practice, in pricing new issues of corporate debt securities of comparable maturity to
the remaining term of the Notes to be redeemed; provided, however, that if no maturity is within
three months before or after the maturity date for such Notes, yields for the two published
maturities most closely corresponding to such United States Treasury security will be determined
and the treasury rate will be interpolated or extrapolated from those yields on a straight line
basis rounding to the nearest month.

     “Comparable Treasury Price” means, with respect to any Redemption Date, (a) the average of the
Reference Treasury Dealer Quotations for the Redemption Date after excluding the highest and lowest
Reference Treasury Dealer Quotations, or (b) if the Independent Investment Banker obtains fewer
than four Reference Treasury Dealer Quotations, the average of all such quotations.

     “Consolidated Net Tangible Assets” means, at any date of determination, the total amount of
assets of the Partnership and its consolidated Subsidiaries after deducting therefrom:

     (1) all current liabilities (excluding (A) any current liabilities that by their terms are
extendable or renewable at the option of the obligor thereon to a time more than twelve months
after the time as of which the amount thereof is being computed, and (B) current maturities of
long-term debt); and

     (2) the value (net of any applicable reserves) of all goodwill, trade names, trademarks,
patents and other like intangible assets,

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all as set forth, or on a pro forma basis would be set forth, on the consolidated balance sheet of
the Partnership and its consolidated Subsidiaries for the Partnership’s most recently completed
fiscal quarter for which financial statements have been filed with the SEC, prepared in accordance
with generally accepted accounting principles.

     “Credit Agreement” means the Amended and Restated Credit Agreement, dated as of July 20, 2007,
among the Partnership, Wachovia Bank, National Association, as Administrative Agent, and the other
agents and lenders party thereto and as further amended, restated, refinanced, replaced or refunded
from time to time.

     “Indebtedness” of any Person at any date means any obligation created or assumed by such
Person for the repayment of borrowed money or any guaranty thereof.

     “Independent Investment Banker” means Morgan Stanley & Co. Incorporated, Credit Suisse
Securities (USA) LLC, J.P. Morgan Securities Inc. and Wachovia Capital Markets, LLC (and their
respective successors) or, if any such firm is not willing and able to select the applicable
Comparable Treasury Issue, an independent investment banking institution of national standing
appointed by the Trustee and reasonably acceptable to the Partnership.

     “Permitted Liens” means:

     (1) liens upon rights-of-way for pipeline purposes;

     (2) easements, rights-of-way, restrictions and other similar encumbrances incurred in the
ordinary course of business and encumbrances consisting of zoning restrictions, easements,
licenses, restrictions on the use of real property or minor imperfections in title thereto and
which do not in the aggregate materially adversely affect the value of the properties encumbered
thereby or materially impair their use in the operation of the business of the Partnership and its
Subsidiaries;

     (3) rights reserved to or vested by any provision of law in any municipality or public
authority to control or regulate any of the properties of the Partnership or any Subsidiary or the
use thereof or the rights and interests of the Partnership or any Subsidiary therein, in any manner
under any and all laws;

     (4) rights reserved to the grantors of any properties of the Partnership or any Subsidiary,
and the restrictions, conditions, restrictive covenants and limitations, in respect thereto,
pursuant to the terms, conditions and provisions of any rights-of-way agreements, contracts or
other agreements therewith;

     (5) any statutory or governmental lien or lien arising by operation of law, or any mechanics’,
repairmen’s, materialmen’s, suppliers’, carriers’, landlords’, warehousemen’s or similar lien
incurred in the ordinary course of business which is not more than sixty (60) days past due or
which is being contested in good faith by appropriate proceedings and any undetermined lien which
is incidental to construction, development, improvement or repair;

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     (6) any right reserved to, or vested in, any municipality or public authority by the terms of
any right, power, franchise, grant, license, permit or by any provision of law, to purchase or
recapture or to designate a purchaser of, any property;

     (7) liens for taxes and assessments which are (a) for the then current year, (b) not at the
time delinquent, or (c) delinquent but the validity or amount of which is being contested at the
time by the Partnership or any of its Subsidiaries in good faith by appropriate proceedings;

     (8) liens of, or to secure performance of, leases, other than capital leases;

     (9) any lien in favor of the Partnership or any Subsidiary;

     (10) any lien upon any property or assets of the Partnership or any Subsidiary in existence on
the date of the initial issuance of the Notes;

     (11) any lien incurred in the ordinary course of business in connection with workmen’s
compensation, unemployment insurance, temporary disability, social security, retiree health or
similar laws or regulations or to secure obligations imposed by statute or governmental
regulations;

     (12) liens in favor of any Person to secure obligations under provisions of any letters of
credit, bank guarantees, bonds or surety obligations required or requested by any governmental
authority in connection with any contract or statute, provided that such obligations do not
constitute Indebtedness; or any lien upon or deposits of any assets to secure performance of bids,
trade contracts, leases or statutory obligations, and other obligations of a like nature incurred
in the ordinary course of business;

     (13) any lien upon any property or assets created at the time of acquisition of such property
or assets by the Partnership or any of its Subsidiaries or within one year after such time to
secure all or a portion of the purchase price for such property or assets or debt incurred to
finance such purchase price, whether such debt was incurred prior to, at the time of or within one
year after the date of such acquisition;

     (14) any lien upon any property or assets to secure all or part of the cost of construction,
development, repair or improvements thereon or to secure Indebtedness incurred prior to, at the
time of, or within one year after completion of such construction, development, repair or
improvements or the commencement of full operations thereof (whichever is later), to provide funds
for any such purpose;

     (15) any lien upon any property or assets existing thereon at the time of the acquisition
thereof by the Partnership or any of its Subsidiaries and any lien upon any property or assets of a
Person existing thereon at the time such Person becomes a Subsidiary of the Partnership by
acquisition, merger or otherwise; provided that, in each case, such lien only encumbers the
property or assets so acquired or owned by such Person at the time such Person becomes a
Subsidiary;

     (16) liens imposed by law or order as a result of any proceeding before any court or
regulatory body that is being contested in good faith, and liens which secure a judgment or other

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court-ordered award or settlement as to which the Partnership or the applicable Subsidiary has
not exhausted its appellate rights;

     (17) any extension, renewal, refinancing, refunding or replacement (or successive extensions,
renewals, refinancing, refunding or replacements) of liens, in whole or in part, referred to in
clauses (1) through (16) above; provided, however, that any such extension, renewal, refinancing,
refunding or replacement lien shall be limited to the property or assets covered by the lien
extended, renewed, refinanced, refunded or replaced and that the obligations secured by any such
extension, renewal, refinancing, refunding or replacement lien shall be in an amount not greater
than the amount of the obligations secured by the lien extended, renewed, refinanced, refunded or
replaced and any expenses of the Partnership or its Subsidiaries (including any premium) incurred
in connection with such extension, renewal, refinancing, refunding or replacement; or

     (18) any lien resulting from the deposit of moneys or evidence of indebtedness in trust for
the purpose of defeasing Indebtedness of the Partnership or any of its Subsidiaries.

     “Principal Property” means, whether owned or leased on the date hereof or thereafter acquired:

     (1) any pipeline assets of the Partnership or any of its Subsidiaries, including any related
facilities employed in the gathering, transportation, distribution, storage or marketing of natural
gas, refined petroleum products, natural gas liquids and petrochemicals, that are located in the
United States of America or any territory or political subdivision thereof; and

     (2) any processing, compression, treating, blending or manufacturing plant or terminal owned
or leased by the Partnership or any of its Subsidiaries that is located in the United States or any
territory or political subdivision thereof, except in the case of either of the preceding clauses
(1) or (2):

     (a) any such assets consisting of inventories, furniture, office fixtures and equipment
(including data processing equipment), vehicles and equipment used on, or useful with,
vehicles;

     (b) any such assets which, in the opinion of the board of directors of the General
Partner are not material in relation to the activities of the Partnership and its
Subsidiaries taken as a whole; and

     (c) any assets used primarily in the conduct of the retail propane marketing business
conducted by Heritage Operating, L.P. and its Subsidiaries.

     “Reference Treasury Dealer” means (a) each of Morgan Stanley & Co. Incorporated, Credit Suisse
Securities (USA) LLC, J.P. Morgan Securities Inc. and Wachovia Capital Markets, LLC (or its
relevant affiliate) and their respective successors, and (b) one other primary U.S. government
securities dealer in the United States selected by the Partnership (each, a “Primary Treasury
Dealer”); provided, however, that if any of the foregoing shall resign as a Reference Treasury
Dealer or cease to be a U.S. government securities dealer, the Partnership will substitute therefor
another Primary Treasury Dealer.

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     “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer
and any Redemption Date for the Notes, an average, as determined by the Independent Investment
Banker, of the bid and asked prices for the Comparable Treasury Issue for the Notes to be redeemed
(expressed in each case as a percentage of its principal amount) quoted in writing to the Trustee
by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third Business Day
preceding such Redemption Date.

     “Restricted Subsidiary” means any Subsidiary owning or leasing, directly or indirectly through
ownership in another Subsidiary, any Principal Property.

     “Subsidiary Guarantor” means, with respect to the Notes and notwithstanding the definition
thereof in the Base Indenture, each Subsidiary of the Partnership that guarantees the Notes
pursuant to the terms of the Indenture, but only so long as such Subsidiary is a guarantor of the
Notes on the terms provided in the Indenture.

     “Treasury Yield” means, with respect to any Redemption Date applicable to the Notes, (a) the
yield, under the heading which represents the average for the immediately preceding week, appearing
in the most recently published statistical release designated “H.15(519)” or any successor
publication which is published weekly by the Board of Governors of the Federal Reserve System and
which establishes yields on actively traded United States Treasury securities adjusted to constant
maturity under the caption “Treasury Constant Maturities,” for the maturity corresponding to the
Comparable Treasury Issue; or (b) if the release (or any successor release) is not published during
the week preceding the calculation date or does not contain these yields, the rate per annum equal
to the semi-annual equivalent yield to maturity (computed as of the third Business Day immediately
preceding such Redemption Date) of the Comparable Treasury Issue, assuming a price for the
Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the
applicable Comparable Treasury Price for such Redemption Date.

ARTICLE II

GENERAL TERMS OF THE NOTES

SECTION 2.1 Form.

     The Notes and the Trustee’s certificate of authentication shall be substantially in the form
of Exhibit A to this Seventh Supplemental Indenture, which is hereby incorporated into this Seventh
Supplemental Indenture. The terms and provisions contained in the Notes shall constitute, and are
hereby expressly made, a part of this Seventh Supplemental Indenture and to the extent applicable,
the Partnership and the Trustee, by their execution and delivery of this Seventh Supplemental
Indenture, expressly agree to such terms and provisions and to be bound thereby.

     The Notes shall be issued upon original issuance in whole in the form of one or more Global
Securities (the “Book-Entry Notes”). Each Book-Entry Note shall represent such of the outstanding
Notes as shall be specified therein and shall provide that it shall represent the aggregate amount
of outstanding Notes from time to time endorsed thereon and that the aggregate amount of
outstanding Notes represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions.

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     The Partnership initially appoints The Depository Trust Company to act as Depositary with
respect to the Book-Entry Notes.

SECTION 2.2 Title, Amount and Payment of Principal and Interest.

     The Notes shall be entitled the “9.70% Senior Notes due 2019”. The Trustee shall authenticate
and deliver (i) the Notes for original issue on the date hereof (the “Original Notes”) in the
aggregate principal amount of $600,000,000, and (ii) additional Notes for original issue from time
to time after the date hereof in such principal amounts as may be specified in a Partnership Order
described in this sentence, in each case upon a Partnership Order for the authentication and
delivery thereof and satisfaction of the other provisions of Section 2.04 of the Base Indenture.
Such order shall specify the amount of the Notes to be authenticated, the date on which the
original issue of Notes is to be authenticated, and the name or names of the initial Holder or
Holders. The aggregate principal amount of Notes that may be outstanding at any time may not exceed
$600,000,000 plus such additional principal amounts as may be issued and authenticated pursuant to
clause (ii) of this paragraph (except as provided in Section 2.09 of the Indenture). The Original
Notes and any additional Notes issued and authenticated pursuant to clause (ii) of this paragraph
shall constitute a single series of Debt Securities for all purposes under the Indenture.

     The principal amount of each Note shall be payable on March 15, 2019. Each Note shall bear
interest from the date of original issuance, or the most recent date to which interest has been
paid, at the fixed rate of 9.70% per annum. The dates on which interest on the Notes shall be
payable shall be March 15 and September 15 of each year, commencing September 15, 2009 (the
“Interest Payment Dates”). The regular record date for interest payable on the Notes on any
Interest Payment Date shall be March 1 or September 1, as the case may be, next preceding such
Interest Payment Date.

     Payments of principal of, premium, if any, and interest due on the Notes representing
Book-Entry Notes on any Interest Payment Date or at maturity will be made available to the Trustee
by 10:00 a.m., New York City time, on such date, unless such date falls on a day which is not a
Business Day, in which case such payments will be made available to the Trustee by 10:00 a.m., New
York City time, on the next Business Day. As soon as possible thereafter, the Trustee will make
such payments to the Depositary.

SECTION 2.3 Transfer and Exchange.

     (a) Transfer and Exchange of Global Notes. The transfer and exchange of Book-Entry Notes or
beneficial interests therein shall be effected through the Depositary, in accordance with Section
2.17 of the Base Indenture and Article II of this Seventh Supplemental Indenture (including the
restrictions on transfer set forth therein and herein) and the rules and procedures of the
Depositary therefor, which shall include restrictions on transfer comparable to those set forth
therein and herein to the extent required by the Securities Act of 1933, as amended.

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ARTICLE III

FUTURE SUBSIDIARY GUARANTEES

SECTION 3.1 No Initial Guarantee of the Notes by Subsidiary Guarantors.

     The Notes initially shall not be entitled to the benefits of the Guarantee contemplated by
Article X of the Base Indenture.

SECTION 3.2 Future Subsidiary Guarantors.

     If any Subsidiary of the Partnership that is not then a Subsidiary Guarantor guarantees,
becomes a co-obligor with respect to or otherwise provides direct credit support for any
obligations of the Partnership or any of its other Subsidiaries under the Credit Agreement, then
the Partnership shall cause such Subsidiary to promptly execute and deliver to the Trustee a
supplemental indenture to the Indenture, in a form satisfactory to the Trustee, providing for the
Guarantee by such Subsidiary of the Partnership’s obligations under the Notes in accordance with
Article X of the Base Indenture.

SECTION 3.3 Release of Guarantees.

     In addition to the provisions of Section 10.04(a) of the Base Indenture, the Guarantee of the
Notes of any Subsidiary Guarantor shall be unconditionally released and discharged, following
delivery of written notice by the Partnership to the Trustee, upon the release and discharge of all
guarantees or other obligations of such Subsidiary Guarantor with respect to the obligations of the
Partnership or its Subsidiaries under the Credit Agreement.

SECTION 3.4 Reinstatement of Guarantees.

     If at any time following any release of the Guarantee of a Subsidiary Guarantor pursuant to
Section 3.3 above, such Subsidiary Guarantor again guarantees, becomes a co-obligor with respect to
or otherwise provides direct credit support for any obligations of the Partnership or any of its
Subsidiaries under the Credit Agreement, then such Subsidiary Guarantor shall again guarantee the
Partnership’s obligations under the Notes and the Partnership shall cause such Subsidiary Guarantor
to promptly execute and deliver a supplemental indenture to the Indenture, in a form satisfactory
to the Trustee, providing for the Guarantee by such Subsidiary Guarantor of the Partnership’s
obligations under the Notes in accordance with Article X of the Base Indenture.

ARTICLE IV

REDEMPTION

SECTION 4.1 Redemption.

     The Partnership shall have no obligation to redeem, purchase or repay the Notes pursuant to
any mandatory redemption, sinking fund or analogous provisions or at the option of a Holder
thereof, except as provided in Article VII.

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     The Notes are redeemable, at the option of the Partnership, at any time in whole, or from time
to time in part, at a Redemption Price equal to the greater of: (i) 100% of the principal amount of
the Notes to be redeemed; or (ii) the sum of the present values of the remaining scheduled payments
of principal and interest (at the rate in effect on the date of calculation of the Redemption
Price) on the Notes to be redeemed that would be due after the related Redemption Date but for such
redemption (exclusive of interest accrued to the Redemption Date) discounted to the Redemption Date
on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the
applicable Treasury Yield plus 50 basis points; plus, in either case, accrued interest to the
Redemption Date.

     The actual Redemption Price, calculated as provided above, shall be calculated and certified
to the Trustee and the Partnership by the Independent Investment Banker.

ARTICLE V

ADDITIONAL COVENANTS

     In addition to the covenants set forth in the Base Indenture, the Notes shall be entitled to
the benefit of the following covenants:

SECTION 5.1 Limitation on Liens.

     The Partnership shall not, nor shall it permit any of its Subsidiaries to, create, assume,
incur or suffer to exist any mortgage, lien, security interest, pledge, charge or other encumbrance
(“liens”) upon any Principal Property or upon any capital stock of any Restricted Subsidiary,
whether owned on the date hereof or thereafter acquired, to secure any Indebtedness of the
Partnership or any other Person (other than the Notes), without in any such case making effective
provisions whereby all of the outstanding Notes are secured equally and ratably with, or prior to,
such Indebtedness so long as such Indebtedness is so secured.

     Notwithstanding the foregoing, the Partnership may, and may permit any of its Subsidiaries to,
create, assume, incur, or suffer to exist without securing the Notes (a) any Permitted Lien, (b)
any lien upon any Principal Property or capital stock of a Restricted Subsidiary to secure
Indebtedness of the Partnership or any other Person, provided that the aggregate principal amount
of all Indebtedness then outstanding secured by such lien and all similar liens under this clause
(b), together with all Attributable Indebtedness from Sale-Leaseback Transactions (excluding
Sale-Leaseback Transactions permitted by clauses (1) through (4), inclusive, of Section 5.2
hereof), does not exceed 10% of Consolidated Net Tangible Assets or (c) any lien upon (i) any
Principal Property that was not owned by the Partnership or any of its Subsidiaries on the date
hereof or (ii) the capital stock of any Restricted Subsidiary that owns no Principal Property that
was owned by the Partnership or any of its Subsidiaries on the date hereof, in each case owned by a
Subsidiary of the Partnership (an “Excluded Subsidiary”) that (A) is not, and is not required to
be, a Subsidiary Guarantor and (B) has not granted any liens on any of its property securing
Indebtedness with recourse to the Partnership or any Subsidiary of the Partnership other than such
Excluded Subsidiary or any other Excluded Subsidiary.

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SECTION 5.2 Restriction on Sale-Leasebacks.

     The Partnership will not, and will not permit any Subsidiary to, engage in the sale or
transfer by the Partnership or any of its Subsidiaries of any Principal Property to a Person (other
than the Partnership or a Subsidiary) and the taking back by the Partnership or its Subsidiary, as
the case may be, of a lease of such Principal Property (a “Sale-Leaseback Transaction”), unless:

     (1) such Sale-Leaseback Transaction occurs within one year from the date of completion of the
acquisition of the Principal Property subject thereto or the date of the completion of
construction, development or substantial repair or improvement, or commencement of full operations
on such Principal Property, whichever is later;

     (2) the Sale-Leaseback Transaction involves a lease for a period, including renewals, of not
more than three years;

     (3) the Partnership or such Subsidiary would be entitled to incur Indebtedness secured by a
lien on the Principal Property subject thereto in a principal amount equal to or exceeding the
Attributable Indebtedness from such Sale-Leaseback Transaction without equally and ratably securing
the Notes; or

     (4) the Partnership or such Subsidiary, within a one-year period after such Sale-Leaseback
Transaction, applies or causes to be applied an amount not less than the Attributable Indebtedness
from such Sale-Leaseback Transaction to (a) the prepayment, repayment, redemption, reduction or
retirement of any Indebtedness of the Partnership or any of its Subsidiaries that is not
subordinated to the Notes or any Guarantee, or (b) the expenditure or expenditures for Principal
Property used or to be used in the ordinary course of business of Partnership or its Subsidiaries.

     Notwithstanding the foregoing, the Partnership may, and may permit any Subsidiary to, effect
any Sale-Leaseback Transaction that is not excepted by clauses (1) through (4), inclusive, of the
preceding paragraph provided that the Attributable Indebtedness from such Sale-Leaseback
Transaction, together with the aggregate principal amount of outstanding Indebtedness (other than
the Notes) secured by liens other than Permitted Liens upon Principal Properties, does not exceed
10% of Consolidated Net Tangible Assets.

ARTICLE VI

ADDITIONAL EVENT OF DEFAULT

SECTION 6.1 Additional Event of Default.

     In addition to the Events of Default specified in Section 6.01 of the Base Indenture, the
following shall be an Event of Default with respect to the Notes: any Indebtedness of the
Partnership or any Subsidiary Guarantor is not paid within any applicable grace period after final
maturity or is accelerated by the holders thereof because of a default and the total amount of such
Indebtedness unpaid or accelerated exceeds $25,000,000.

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ARTICLE VII

REPURCHASE AT THE OPTION OF HOLDER

SECTION 7.1 Repurchase of Notes.

     Each Holder of the Notes will have the right (the “Repurchase Option”) to require the
Partnership to repurchase all or a portion of such Holder’s Notes on March 15, 2012 (the
“Repurchase Date”) at a purchase price equal to 100% of the principal amount of the Notes tendered
by such Holder, plus accrued and unpaid interest on such Notes, to, but excluding, the Repurchase
Date (the “Repurchase Price”). At or before 10:00 a.m., New York City time, on the Repurchase Date,
the Partnership will deposit with the Trustee (or a separate Paying Agent) money sufficient to pay
the Repurchase Price of the Notes tendered for repurchase in accordance with this Article VII
(unless the Repurchase Date falls on a day that is not a Business Day, in which case such deposit
shall be made on the next Business Day). As soon as possible thereafter, the Trustee (or separate
Paying Agent, if one has been appointed) will cause payment of the Repurchase Price of such Notes
to be made (a) to the Depositary, in the case of Global Securities, and (b) by wire transfer or
check mailed to a Holder’s registered address, in the case of Notes in certificated form. A
Holder’s exercise of the Repurchase Option will be irrevocable.

SECTION 7.2 Exercise of Repurchase Option.

     Each certificate representing the Notes will contain an “Option to Elect Repurchase” form
thereon. In order for any Note to be repurchased at the option of the Holder pursuant to this
Article VII, the Trustee (or separate Paying Agent, if one has been appointed) must receive, at its
Corporate Trust Office (or at such other place or places of which the Partnership shall from time
to time notify the Holders of the Notes) not more than 60 calendar days nor less than 45 calendar
days prior to the Repurchase Date, the particular Notes to be tendered for such repurchase and:

     (1) in the case of a certificated Note, a duly completed “Option to Elect Repurchase”;
or

     (2) in the case of Notes represented by a Global Security, repurchase instructions from
the applicable beneficial owner to the Depositary and forwarded by the Depositary.

All instructions from beneficial owners of Notes represented by Global Securities relating
to the Repurchase Option shall be irrevocable.

SECTION 7.3 Notes Repurchased in Part.

     Upon surrender of any certificated Note which is to be repurchased in part only (with, if the
Partnership or the Trustee (or separate Paying Agent, if one has been appointed) so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the Partnership and the
Registrar duly executed by, the Holder thereof or his attorney duly authorized in writing), the
Partnership shall execute and the Trustee shall authenticate and deliver to the Holder of such
Note, without service charge and at the expense of the Partnership, a new certificated Note or
Notes of any authorized denomination specified by the Holder, in an

11

 

aggregate principal amount equal to and in exchange for the portion of the principal of such
Note so surrendered which is not to be repurchased.

SECTION 7.4 Compliance with Exchange Act.

     If applicable, the Partnership will comply with the requirements of Section 14(e) of the
Exchange Act and the rules promulgated thereunder and any other securities laws or regulations in
connection with any repurchase of Notes at the option of the Holders.

ARTICLE VIII

MISCELLANEOUS PROVISIONS

SECTION 8.1 Ratification of Base Indenture.

     The Base Indenture, as supplemented by this Seventh Supplemental Indenture, is in all respects
ratified and confirmed, and this Seventh Supplemental Indenture shall be deemed part of the Base
Indenture in the manner and to the extent herein and therein provided.

SECTION 8.2 Trustee Not Responsible for Recitals.

     The recitals contained herein and in the Notes, except with respect to the Trustee’s
certificates of authentication, shall be taken as the statements of the Partnership, and the
Trustee assumes no responsibility for the correctness of the same. The Trustee makes no
representations as to the validity or sufficiency of this Seventh Supplemental Indenture or of the
Notes.

SECTION 8.3 Table of Contents, Headings, etc.

     The table of contents and headings of the Articles and Sections of this Seventh Supplemental
Indenture have been inserted for convenience of reference only, are not to be considered a part
hereof and shall in no way modify or restrict any of the terms or provisions hereof.

SECTION 8.4 Counterpart Originals.

     The parties may sign any number of copies of this Seventh Supplemental Indenture. Each signed
copy shall be an original, but all of them together represent the same agreement.

SECTION 8.5 Governing Law.

     THIS SEVENTH SUPPLEMENTAL INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

[Signature Pages Follow]

12

 

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

	 	 	 	 	 	 	 
	 	 	ISSUER:	 	 
	 
	 	 	 	 	 	 
	 	 	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/ Martin Salinas	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Martin Salinas	 	 
	 

	 	Title:	 	Chief Financial Officer	 	 
	 
	 	 	 	 	 	 
	 	 	TRUSTEE:	 	 
	 
	 	 	 	 	 	 
	 	 	U.S. BANK NATIONAL ASSOCIATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Steven A. Finklea	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Steven A. Finklea	 	 
	 

	 	Title:	 	Vice President	 	 

 

 

Exhibit A

FORM OF NOTE

[FACE OF SECURITY]

     [UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (“DTC”) (55 WATER STREET, NEW YORK, NEW YORK 10041) TO THE PARTNERSHIP OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]*

     [TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET
FORTH IN THE INDENTURE REFERRED TO HEREIN.]*

			
	 	 	 
	No.                    
	 	$                    

CUSIP 29273R AK 5

ENERGY TRANSFER PARTNERS, L.P.

9.70% SENIOR NOTES DUE 2019

     ENERGY TRANSFER PARTNERS, L.P., a Delaware limited partnership (the “Partnership,” which term
includes any successor under the Indenture hereinafter referred to), for value received, hereby
promises to pay to Cede & Co.* or its registered assigns, the principal sum of                      U.S.
dollars ($                    ), [or such greater or lesser principal sum as is shown on the attached
Schedule of Increases and Decreases in Global Security]*, on March 15, 2019 in such coin and
currency of the United States of America as at the time of payment shall be legal tender for the
payment of public and private debts, and to pay interest thereon at an annual rate of 9.70% payable
on March 15 and September 15 of each year, beginning September 15, 2009, to the person in whose
name the Security is registered at the close of business on the record date for such interest,
which shall be the preceding March 1 or September 1 (each, a

 

			
	*	 	To be included in a Book Entry Note.

A-2

 

“Regular Record Date”), respectively, with such interest accruing from December 23, 2008, or
the most recent date to which interest shall have been paid.

     Reference is made to the further provisions of this Security set forth on the reverse hereof.
Such further provisions shall for all purposes have the same effect as though fully set forth at
this place.

     The statements in the legends set forth in this Security are an integral part of the terms of
this Security and by acceptance hereof the Holder of this Security agrees to be subject to, and
bound by, the terms and provisions set forth in each such legend.

     This Security is issued in respect of a series of Debt Securities in an initial aggregate
principal amount of $600,000,000 designated as the 9.70% Senior Notes due 2019 of the Partnership
and is governed by the Indenture dated as of January 18, 2005 (the “Base Indenture”), duly executed
and delivered by the Partnership, as issuer, to Wachovia Bank, National Association, as trustee, as
supplemented by the Seventh Supplemental Indenture dated as of December 23, 2008, duly executed by
the Partnership and U.S. Bank National Association (the “Trustee”), as successor to Wachovia Bank,
National Association, (the “Seventh Supplemental Indenture”, and together with the Base Indenture,
the “Indenture”). The terms of the Indenture are incorporated herein by reference. This Security
shall in all respects be entitled to the same benefits as definitive Debt Securities under the
Indenture.

     If and to the extent any provision of the Indenture limits, qualifies or conflicts with any
other provision of the Indenture that is required to be included in the Indenture or is deemed
applicable to the Indenture by virtue of the provisions of the Trust Indenture Act of 1939, as
amended (the “TIA”), such required provision shall control.

     This Security shall not be valid or become obligatory for any purpose until the Trustee’s
Certificate of Authentication hereon shall have been manually signed by the Trustee under the
Indenture.

A-3

 

     IN WITNESS WHEREOF, the Partnership has caused this instrument to be duly executed by its sole
General Partner.

Dated:                     , ____

	 	 	 	 	 	 	 
	 	 	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:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION:

     This is one of the Debt Securities of the series designated therein referred to in the
within-mentioned Indenture.

	 	 	 	 	 
	 	U.S. BANK NATIONAL ASSOCIATION,

as Trustee

 	 
	 	By:  	 	 
	 	 	Authorized Signatory 	 
	 	 	 	 

A-4

 

	 	 	 	 	 

[REVERSE OF SECURITY]

ENERGY TRANSFER PARTNERS, L.P.

9.70% SENIOR NOTES DUE 2019

     This Security is one of a duly authorized issue of debentures, notes or other evidences of
indebtedness of the Partnership (the “Debt Securities”) of the series hereinafter specified, all
issued or to be issued under and pursuant to the Indenture, to which Indenture reference is hereby
made for a description of the rights, limitations of rights, obligations, duties and immunities
thereunder of the Trustee, the Partnership and the Holders of the Debt Securities. The Debt
Securities may be issued in one or more series, which different series may be issued in various
aggregate principal amounts, may mature at different times, may bear interest (if any) at different
rates, may be subject to different sinking, purchase or analogous funds (if any) and may otherwise
vary as provided in the Indenture. This Security is one of a series designated as the 9.70% Senior
Notes due 2019 of the Partnership, in an initial aggregate principal amount of $600,000,000 (the
“Securities”).

1. Interest.

     The Partnership promises to pay interest on the principal amount of this Security at the rate
of 9.70% per annum.

     The Partnership will pay interest semi-annually on March 15 and September 15 of each year
(each an “Interest Payment Date”), commencing September 15, 2009. Interest on the Securities will
accrue from the most recent date to which interest has been paid or, if no interest has been paid
on the Securities, from December 23, 2008. Interest will be computed on the basis of a 360-day year
consisting of twelve 30-day months. The Partnership shall pay interest (including post-petition
interest in any proceeding under any applicable bankruptcy laws) on overdue installments of
interest (without regard to any applicable grace period) and on overdue principal and premium, if
any, from time to time on demand at the same rate per annum, in each case to the extent lawful.

2. Method of Payment.

     The Partnership shall pay interest on the Securities (except Defaulted Interest) to the
persons who are the registered Holders at the close of business on the Regular Record Date
immediately preceding the Interest Payment Date. Any such interest not so punctually paid or duly
provided for (“Defaulted Interest”) may be paid to the persons who are registered Holders at the
close of business on a special record date for the payment of such Defaulted Interest, or in any
other lawful manner not inconsistent with the requirements of any securities exchange on which such
Securities may then be listed if such manner of payment shall be deemed practicable by the Trustee,
as more fully provided in the Indenture. The Partnership shall pay principal, premium, if any, and
interest in such coin or currency of the United States of America as at the time of payment shall
be legal tender for payment of public and private debts. Payments in respect of a Global Security
(including principal, premium, if any, and interest) will be made by wire transfer of immediately
available funds to the accounts specified by the Depositary. Payments in respect of Securities in
definitive form (including principal, premium, if any, and

A-5

 

interest) will be made at the office or agency of the Partnership maintained for such purpose
within The City of New York, which initially will be at the corporate trust office of the Trustee
located at 100 Wall Street, Suite 1600, New York, New York 10005, Mail Station:  EX-NY-WALL, or, at
the option of the Partnership, payment of interest may be made by check mailed to the Holders on
the relevant record date at their addresses set forth in the register of Holders maintained by the
Registrar or at the option of the Holder, payment of interest on Securities in definitive form will
be made by wire transfer of immediately available funds to any account maintained in the United
States, provided such Holder has requested such method of payment and provided timely wire transfer
instructions to the Paying Agent. The Holder must surrender this Security to a Paying Agent to
collect payment of principal.

3. Paying Agent and Registrar.

     Initially, U.S. Bank National Association will act as Paying Agent and Registrar. The
Partnership may change any Paying Agent or Registrar at any time upon notice to the Trustee and the
Holders. The Partnership may act as Paying Agent.

4. Indenture.

     This Security is one of a duly authorized issue of Debt Securities of the Partnership issued
and to be issued in one or more series under the Indenture.

     Capitalized terms herein are used as defined in the Indenture unless otherwise defined herein.
The terms of the Securities include those stated in the Base Indenture, those made part of the
Indenture by reference to the TIA, as in effect on the date of the Base Indenture, and those terms
stated in the Seventh Supplemental Indenture. The Securities are subject to all such terms, and
Holders of Securities are referred to the Base Indenture, the Seventh Supplemental Indenture and
the TIA for a statement of them. The Securities of this series are general unsecured obligations of
the Partnership limited to an initial aggregate principal amount of $600,000,000; provided,
however, that the authorized aggregate principal amount of such series may be increased from time
to time as provided in the Seventh Supplemental Indenture.

5. Redemption.

     The Securities are redeemable, at the option of the Partnership, at any time in whole, or from
time to time in part, at a Redemption Price equal to the greater of: (i) 100% of the principal
amount of the Securities to be redeemed; or (ii) the sum of the present values of the remaining
scheduled payments of principal and interest (at the rate in effect on the date of calculation of
the Redemption Price) on the Securities to be redeemed that would be due after the related
Redemption Date but for such redemption (exclusive of interest accrued to the Redemption Date)
discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year consisting of
twelve 30-day months) at the applicable Treasury Yield plus 50 basis points; plus, in either case,
accrued interest to the Redemption Date.

     The actual Redemption Price, calculated as provided above, shall be calculated and certified
to the Trustee and the Partnership by the Independent Investment Banker.

A-6

 

     Except as set forth above and in Article VII of the Seventh Supplemental Indenture (as
described in Section 6 of this Security), the Securities will not be redeemable prior to their
Stated Maturity and will not be entitled to the benefit of any sinking fund.

6. Repurchase at the Option of Holder.

     Each Holder of the Securities will have the right (the “Repurchase Option”) to require the
Partnership to repurchase all or a portion of such Holder’s Securities on March 15, 2012 (the
“Repurchase Date”) at a purchase price equal to 100% of the principal amount of the Securities
tendered by such Holder, plus accrued and unpaid interest on such Securities, to, but excluding,
the Repurchase Date (the “Repurchase Price”). At or before 10:00 a.m., New York City time, on the
Repurchase Date, the Partnership will deposit with the Trustee (or a separate Paying Agent) money
sufficient to pay the Repurchase Price of the Securities tendered for repurchase in accordance with
this Section 6 and Article VII of the Seventh Supplemental Indenture (unless the Repurchase Date
falls on a day that is not a Business Day, in which case such deposit shall be made on the next
Business Day). As soon as possible thereafter, the Trustee (or separate Paying Agent, if one has
been appointed) will cause payment of the Repurchase Price of such Securities to be made (a) to the
Depositary, in the case of Global Securities, and (b) by wire transfer or check mailed to a
Holder’s registered address, in the case of Securities in certificated form. A Holder’s exercise
of the Repurchase Option will be irrevocable.

     In order for any Security to be repurchased pursuant to the Repurchase Option, the Trustee (or
separate Paying Agent, if one has been appointed) must receive, at its Corporate Trust Office (or
at such other place or places of which the Partnership shall from time to time notify the Holders
of the Securities) not more than 60 calendar days nor less than 45 calendar days prior to the
Repurchase Date, the particular Securities to be tendered for such repurchase and:

     (1) in the case of a certificated Security, a duly completed “Option to Elect
Repurchase”; or

     (2) in the case of Securities represented by a Global Security, repurchase instructions
from the applicable beneficial owner to the Depositary and forwarded by the Depositary.

     All instructions from beneficial owners of Securities represented by Global Securities relating to
the Repurchase Option shall be irrevocable.

7. Denominations; Transfer; Exchange.

     The Securities are to be issued in registered form, without coupons, in denominations of
$1,000 and integral multiples of $1,000 in excess thereof. A Holder may register the transfer of,
or exchange, Securities in accordance with the Indenture. The Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and
fees required by law or permitted by the Indenture.

A-7

 

8. Person Deemed Owners.

     The registered Holder of a Security may be treated as the owner of it for all purposes.

9. Amendment; Supplement; Waiver.

     Subject to certain exceptions, the Indenture may be amended or supplemented, and any existing
Event of Default or compliance with any provision may be waived, with the consent of the Holders of
a majority in principal amount of the outstanding Debt Securities of each series affected. Without
consent of any Holder of a Security, the parties thereto may amend or supplement the Indenture to,
among other things, cure any ambiguity or omission, to correct any defect or inconsistency, or to
make any other change that does not adversely affect the rights of any Holder of a Security. Any
such consent or waiver by the Holder of this Security (unless revoked as provided in the Indenture)
shall be conclusive and binding upon such Holder and upon all future Holders and owners of this
Security and any Securities which may be issued in exchange or substitution herefor, irrespective
of whether or not any notation thereof is made upon this Security or such other Securities.

10. Defaults and Remedies.

     Certain events of bankruptcy or insolvency are Events of Default that will result in the
principal amount of the Securities, together with premium, if any, and accrued and unpaid interest
thereon, becoming due and payable immediately upon the occurrence of such Events of Default. If any
other Event of Default with respect to the Securities occurs and is continuing, then in every such
case the Trustee or the Holders of not less than 25% in aggregate principal amount of the
Securities then outstanding may declare the principal amount of all the Securities, together with
premium, if any, and accrued and unpaid interest thereon, to be due and payable immediately in the
manner and with the effect provided in the Indenture. Notwithstanding the preceding sentence,
however, if at any time after such a declaration of acceleration has been made, the Holders of a
majority in principal amount of the outstanding Securities, by written notice to the Trustee, may
rescind such declaration and annul its consequences if the rescission would not conflict with any
judgment or decree of a court already rendered and if all Events of Default with respect to the
Securities, other than the nonpayment of the principal, premium, if any, or interest which has
become due solely by such declaration acceleration, shall have been cured or shall have been
waived. No such rescission shall affect any subsequent default or shall impair any right consequent
thereon. Holders of Securities may not enforce the Indenture or the Securities except as provided
in the Indenture. The Trustee may require indemnity or security satisfactory to it before it
enforces the Indenture or the Securities. Subject to certain limitations, Holders of a majority in
aggregate principal amount of the Securities then outstanding may direct the Trustee in its
exercise of any trust or power.

11. Trustee Dealings with Partnership.

     The Trustee under the Indenture, in its individual or any other capacity, may make loans to,
accept deposits from, and perform services for the Partnership or its Affiliates, and may otherwise
deal with the Partnership or its Affiliates as if it were not the Trustee.

A-8

 

12. Authentication.

     This Security shall not be valid until the Trustee signs the certificate of authentication on
the other side of this Security.

13. Abbreviations and Defined Terms.

     Customary abbreviations may be used in the name of a Holder of a Security or an assignee, such
as: TEN COM (tenant in common), TEN ENT (tenants by the entireties), JT TEN (joint tenants with
right of survivorship and not as tenants in common), CUST (Custodian), and U/G/M/A (Uniform Gifts
to Minors Act).

14. CUSIP Numbers.

     Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification
Procedures, the Partnership has caused CUSIP numbers to be printed on the Securities as a
convenience to the Holders of the Securities. No representation is made as to the accuracy of such
number as printed on the Securities and reliance may be placed only on the other identification
numbers printed hereon.

15. Absolute Obligation.

     No reference herein to the Indenture and no provision of this Security or the Indenture shall
alter or impair the obligation of the Partnership, which is absolute and unconditional, to pay the
principal of, premium, if any, and interest on this Security in the manner, at the respective
times, at the rate and in the coin or currency herein prescribed.

16. No Recourse.

     No director, officer, employee, limited partner or shareholder, as such, of the Partnership or
the General Partner shall have any personal liability in respect of the obligations of the
Partnership under the Securities, the Indenture or any Guarantee by reason of his, her or its
status. Each Holder by accepting the Securities waives and releases all such liability. The waiver
and release are part of the consideration for issuance of the Securities.

17. Governing Law.

     This Security shall be construed in accordance with and governed by the laws of the State of
New York.

A-9

 

ABBREVIATIONS

     The following abbreviations, when used in the inscription on the face of this instrument, shall be
construed as though they were written out in full according to applicable laws or regulations:

	 	 	 	 	 
	TEN COM — as tenants in common	 	UNIF GIFT MIN ACT -
	 

	 	 	 	(Cust.)
	TEN ENT — as tenants by entireties	 	Custodian for:
	 

	 	 	 	(Minor)
	JT TEN — as joint tenants with right
of survivorship and not as tenants in
common	 	Under Uniform Gifts to Minors Act of
	 

	 	 	 	(State)

Additional abbreviations may also be used though not in the above list.

ASSIGNMENT

FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto

PLEASE INSERT SOCIAL SECURITY OR OTHER

IDENTIFYING NUMBER OF ASSIGNEE

Please print or type name and address including postal zip code of assignee:

the within Security and all rights thereunder, hereby irrevocably constituting and appointing to
transfer said Security on the books of the Partnership, with full power of substitution in the
premises.

	 	 	 
	Dated

	 	Registered Holder

A-10

 

OPTION TO ELECT REPURCHASE

     If you want to elect to have this Security repurchased by the Partnership pursuant to the
provisions set forth in such Security governing the Repurchase Option, check the following box:

	 	o	 	I hereby elect to exercise my Repurchase Option with respect to
this Security.

     If you want to elect to have only part of the Security purchased by the Partnership pursuant
to such exercise, state the amount you elect to have purchased:

$_________________

          Date:                                         

	 	 	 	 	 	 	 
	 

	 	Your Signature:	 	 	 	 
	 

	 	 	 	 

(Sign exactly as
your name appears on
the face of this
Security)
	 	 

	 	 	 	 	 	 	 
	 

	 	Tax Identification No.:	 	 	 	 
	 

	 	 	 	 	 	 

Signature Guarantee*:                                                             

 

			
	*	 	Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).

A-11

 

SCHEDULE OF INCREASES OR DECREASES

IN GLOBAL SECURITY*

     The following increases or decreases in this Global Security have been made:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Principal Amount of	 	 	 	 
	 	 	Amount of Decrease	 	 	Amount of Increase	 	 	this Global	 	 	Signature of	 
	 	 	in Principal Amount	 	 	in Principal Amount	 	 	Security following	 	 	authorized officer	 
	 	 	of this Global	 	 	of this Global	 	 	such decrease	 	 	of Trustee or	 
	Date of Exchange	 	Security	 	 	Security	 	 	(or increase)	 	 	Depositary	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

			
	*	 	To be included in a Book-Entry Note.

A-12exv10w1

Execution Copy

SECOND AMENDMENT TO CREDIT AGREEMENT

     THIS SECOND AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) is dated as of December
19, 2008, by and among THE MERIDIAN RESOURCE CORPORATION, a Texas corporation (the
“Borrower”), the several banks, financial institutions and other entities from time to time
parties to the Credit Agreement (as defined below) (collectively, the “Lenders”), and
FORTIS CAPITAL CORP. (“Fortis”), as administrative agent for the Lenders.

R E C I T A L S

     WHEREAS, the Borrower, Fortis as Administrative Agent, and the Lenders have entered into an
Amended and Restated Credit Agreement dated as of December 23, 2004 (as amended, the “Credit
Agreement”);

     WHEREAS, the Borrower, Fortis as Administrative Agent, and the Lenders have agreed to make
certain amendments to the Credit Agreement;

     NOW, THEREFORE, in consideration of the premises herein contained and other good and valuable
consideration, the sufficiency of which is hereby acknowledged, the parties hereto, intending to be
legally bound, agree as follows:

     1. Defined Terms. All capitalized terms used but not otherwise defined in this
Amendment shall have the meaning ascribed to them in the Credit Agreement. Unless otherwise
specified, all section references herein refer to sections of the Credit Agreement.

     2. Amendments to Credit Agreement.

     2.1 Definitions (Section 1).

     (a) ABR. The definition of “ABR” is amended to read as follows:

     “‘ABR’ – for any day, a rate per annum (rounded
upwards, if necessary, to the next 1/16 of 1%) equal to the greater
of (a) the Prime Rate in effect on such day, (b) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1%, and (c) the
Eurodollar Rate for an Interest Period of one month commencing on
such day. For purposes hereof: ‘Prime Rate’ shall mean the
rate of interest per annum publicly announced from time to time by
Fortis Bank S.A./N.V. as its prime rate in effect at its principal
office in New York City (the Prime Rate not being intended to be the
lowest rate of interest charged by Fortis Bank S.A./N.V. in
connection with extensions of credit to debtors); and “Federal
Funds Effective Rate” shall mean, for any day, the weighted
average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds
brokers, as published on
the next succeeding Business Day by the Federal Reserve Bank of
new York, or, if such rate is not so published for any day which is

2ndAmendment to Credit Agreement — Meridian

 

a Business Day, the average of the quotations for the day of such
transactions received by the Administrative Agent from three federal
funds brokers of recognized standing selected by it. Any change in
the ABR due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective as of the opening of business on
the effective day of such change in the Prime Rate or the Federal
Funds Effective Rate, respectively.”

     (b) Applicable Margin. The definition of “Applicable Margin” is
amended to read as follows:

     “‘Applicable Margin’ – for any day with respect to
Eurodollar Loans and ABR Loans, the applicable per annum rate set
forth below opposite the Borrowing Base Usage in effect on any such
day:

	 	 	 	 	 	 	 	 	 
	 	 	Eurodollar	 	ABR
	                   Borrowing Base Usage	 	Margin	 	Margin
	Less than or equal to 50%
	 	 	2.00	%	 	 	1.25	%
	Greater than 50% and less than or equal to 75%
	 	 	2.25	%	 	 	1.50	%
	Greater than 75% and less than or equal to 90%
	 	 	2.50	%	 	 	1.75	%
	Greater than 90%
	 	 	3.25	%	 	 	2.50	%

As used herein, “Borrowing Base Usage” on any day means the
percentage equivalent to the ratio of (i) the sum of the aggregate
principal amount of the Loans then outstanding and Letter of Credit
Outstandings on such day to (ii) the Borrowing Base in effect on
such day.”

     3. Borrowing Base. The Borrowing Base as of the effectiveness of this Amendment is
$95,000,000.00.

     4. Effectiveness of Amendment. This Amendment shall become effective upon receipt by
the Administrative Agent, on behalf of the Lenders, of:

     (a) An executed copy of this Amendment;

     (b) A copy of a Confirmation of Guarantee, in form and substance satisfactory
to the Administrative Agent, duly executed by each Guarantor; and

     (c) Payment of all fees due and owing to the Administrative Agent and the
Lenders.

2ndAmendment to Credit Agreement — Meridian

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     5. Ratifications, Borrower Representations and Warranties.

     5.1 The terms and provisions set forth in this Amendment shall modify and supersede all
inconsistent terms and provisions set forth in the Credit Agreement and, except as expressly
modified and superseded by this Amendment, the terms and provisions of the Credit Agreement
are ratified and confirmed and shall continue in full force and effect. The Borrower and
the Lenders agree that the Credit Agreement and the Loan Documents, as amended hereby, shall
continue to be legal, valid, binding and enforceable in accordance with their respective
terms.

     5.2 To induce the Lenders to enter into this Amendment, the Borrower ratifies and
confirms that each representation and warranty set forth in the Credit Agreement is true and
correct in all material respects as if such representations and warranties were made on the
even date herewith (unless any such representations and warranties are stated to refer to a
specific earlier date, in which case such representations and warranties shall be true and
correct in all material respects as of such earlier date), and further represents and
warrants (a) that there has occurred since the date of the last financial statements
delivered to the Lender no event or circumstance that has resulted or could reasonably be
expected to result in a Material Adverse Effect, (b) that no Event of Default exists on the
date hereof, and (c) that the Borrower is fully authorized to enter into this Amendment.

     6. Benefits. This Amendment shall be binding upon and inure to the benefit of the
Lender and the Borrower and their respective successors and assigns; provided, however, that
Borrower may not, without the prior written consent of the Lenders, assign any rights, powers,
duties or obligations under this Amendment, the Credit Agreement or any of the other Loan
Documents.

     7. Construction. This Amendment shall be governed by and construed in accordance with
the laws of the State of Texas.

     8. Invalid Provisions. If any provision of this Amendment is held to be illegal,
invalid or unenforceable under present or future laws, such provision shall be fully severable and
the remaining provisions of this Amendment shall remain in full force and effect and shall not be
affected by the illegal, invalid or unenforceable provision or by its severance.

     9. Entire Agreement. The Credit Agreement, as amended by this Amendment, contains the
entire agreement among the parties regarding the subject matter hereof and supersedes all prior
written and oral agreements and understandings among the parties hereto regarding same.

     10. Reference to Credit Agreement. The Credit Agreement and any and all other
agreements, documents or instruments now or hereafter executed and delivered pursuant to the terms
hereof or pursuant to the terms of the Credit Agreement, as amended hereby, are hereby amended so
that any reference in the Credit Agreement to the Credit Agreement shall mean a reference to the
Credit Agreement as amended hereby.

2ndAmendment to Credit Agreement — Meridian

3

 

     11. Counterparts. This Amendment may be separately executed in any number of
counterparts (including by facsimile or other electronic transmission), each of which shall be an
original, but all of which, taken together, shall be deemed to constitute one and the same
agreement.

[The Remainder of this Page Intentionally Left Blank]

2ndAmendment to Credit Agreement — Meridian

4

 

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of
the day and year first written above.

	 	 	 	 	 	 	 
	 	 	THE MERIDIAN RESOURCE CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Lloyd V. DeLano	 	 
	 

	 	Name:
	 	Lloyd V. DeLano
	 	 
	 

	 	Title:
	 	Senior Vice President and Chief Accounting Officer
	 	 

2ndAmendment to Credit Agreement — Meridian

5

 

	 	 	 	 	 	 	 
	 	 	FORTIS CAPITAL CORP., as Administrative	 	 
	 	 	Agent, Co-Lead Arranger, Bookrunner, Issuing	 	 
	 	 	Lender and a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ David Montgomery	 	 
	 

	 	Name:
	 	 David Montgomery
	 	 
	 

	 	Title:
	 	Director
	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Darrell Holley	 	 
	 

	 	Name:
	 	Darrell Holley
	 	 
	 

	 	Title:
	 	Managing Director
	 	 

2ndAmendment to Credit Agreement — Meridian

6

 

	 	 	 	 	 	 	 
	 	 	THE BANK OF NOVA SCOTIA, as Co-Lead Arranger, Syndication Agent and a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ David G. Mills	 	 
	 

	 	Name:
	 	David G. Mills
	 	 
	 

	 	Title:
	 	Managing Director
	 	 

2ndAmendment to Credit Agreement — Meridian

7

 

	 	 	 	 	 	 	 
	 	 	COMERICA BANK, as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Greg Smith	 	 
	 

	 	Name:
	 	Greg Smith
	 	 
	 

	 	Title:
	 	Senior Vice President
	 	 

2ndAmendment to Credit Agreement — Meridian

8

 

	 	 	 	 	 	 	 
	 	 	U.S. BANK NATIONAL ASSOCIATION, as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Justin M. Alexander	 	 
	 

	 	Name:
	 	Justin M. Alexander
	 	 
	 

	 	Title:
	 	Vice President
	 	 

2ndAmendment to Credit Agreement — Meridian

9

 

	 	 	 	 	 	 	 
	 	 	ALLIED IRISH BANKS plc, as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Aiden L. Lanigan	 	 
	 

	 	Name:
	 	Aiden L. Lanigan
	 	 
	 

	 	Title:
	 	Vice President
	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Robert F. Moyle	 	 
	 

	 	Name:
	 	Robert F. Moyle
	 	 
	 

	 	Title:
	 	Senior Vice President
	 	 

2ndAmendment to Credit Agreement — Meridian

10

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