Document:

exhibit10_6.htm

    
      Exhibit
10.6

    

    AMENDMENT
NO. 1 TO TRANSITIONAL OPERATING AGREEMENT

     

    AMENDMENT
NO. 1, dated as of February 29, 2008 (this “Amendment”), to that
certain Transitional Operating Agreement, dated as of February 1, 2008
(the “Operating Agreement”), by and among Cenac Towing Co., Inc.,
a Louisiana corporation (“Cenac Towing”), Cenac Offshore, L.L.C., a Louisiana
limited liability company (together with Cenac Towing, the “Cenac Companies”),
Mr. Arlen B. Cenac, Jr., a resident of Houma, Louisiana and the sole owner
of all the stock and equity interests of the Cenac Companies (the “Stockholder”
and, together with the Cenac Companies, the “Operators”), and TEPPCO Marine
Services, LLC, a Delaware limited liability company
(the “Owner”).

     

    RECITALS

     

    WHEREAS,
on February 1, 2008, the Operators agreed to provide the Services to the Owner
upon the terms and subject to the conditions set forth in the Operating
Agreement for the fees and reimbursement of the costs set forth
therein;

     

    WHEREAS,
the Owner, Horizon Maritime, L.L.C., a Louisiana limited liability company
(“Horizon”), the Stockholder and the other members of Horizon have executed an
Asset Purchase Agreement, of date even herewith, providing for the purchase of
substantially all of the business operations and assets of Horizon, as described
and upon the terms and subject to the conditions and exceptions set forth
therein; and

     

    WHEREAS,
the Owner and the Operators wish to amend the Operating Agreement as provided
herein in connection with the acquisition by the Owner of assets from Horizon to
provide for the operation thereby the Operators;

     

    NOW,
THEREFORE, in consideration of the premises, the mutual agreements hereinafter
contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree that,
effective as of the date of this Amendment, the Operating Agreement shall be
amended as follows:

     

    ARTICLE
I

    DEFINITIONS

     

    1. Definitions.  Unless
otherwise defined herein, capitalized terms used in this Amendment shall have
the respective meaning ascribed to such terms in the Operating
Agreement.

     

    ARTICLE
II

    AMENDMENTS
TO THE OPERATING AGREEMENT

     

    1. Amendment to the Recitals to
the Operating Agreement.  The first Recital to the Operating
Agreement is hereby amended and restated in its entirety as
follows:

     

    “WHEREAS,
the Owner, TEPPCO Partners, L.P., a Delaware limited partnership (the
“Partnership”), and the Operators have entered into that certain Asset Purchase
Agreement dated as of the date hereof (as amended from time to 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

                                      

                                     
time, the “Purchase Agreement”), pursuant to which the Operators have sold to
the Owner certain marine assets and rights relating to the Operations, as
specified and defined in the Purchase Agreement;”

    

     

    2. Amendments to Article I of
the Operating Agreement.

     

    (a) The
definitions of “Asphalt Business Limitation” and “Horizon Maritime” in Section
1.1 of the Operating Agreement are hereby deleted in their
entirety.

     

    (b) The
definition of “Employee” in Section 1.1 of the Operating Agreement is hereby
amended and restated in its entirety to read as follows:

     

    “Employee” means each
employee of either of the Cenac Companies, including any employees hired or
retained after the date of this Agreement; provided, however, that (i) in no
event shall any Employee be considered to be an employee of the Owner and (ii)
nothing in this Agreement shall be construed as an offer of or contract for
employment with any such Employee.”

     

    (c) The
definition of “Purchased Operations” in Section 1.1 of the Operating Agreement
is hereby amended by deleting the following therefrom:

     

    “from the
Operators or their Affiliates”

     

    (d) Section
1.1 of the Operating Agreement is hereby amended by adding the following in the
appropriate alphabetical location:

     

    ““Vessel”
shall mean the Vessels, as defined in the Purchase Agreement, the Vessels, as
defined in that certain Asset Purchase Agreement, dated as of February 29, 2008,
by and among Buyer, Horizon Maritime, L.L.C., a Louisiana limited liability
company, and the members of Horizon Maritime, L.L.C. and any other boats, barges
or other marine vessels (including related Vessel Equipment) owned or acquired
by the Owner or by the Operators with Owner funds (for which they are reimbursed
by the Owner).”

     

    2. Amendment to Article II of
the Operating Agreement.

     

    (a)  Clause
(iii) of Section 2.1(b) of the Operating Agreement is hereby amended and
restated in its entirety to read as follows:

     

    “(iii) in
accordance with the usual and customary practices in the industry in which the
Purchased Operations operate, including the American Waterways Operators
Responsible Carrier Program,”

     

    (b)  Section
2.2 of the Operating Agreement is hereby amended to add the following as the
last sentence thereof:

     

    “The
Operators represent, warrant, acknowledge and agree that any and all Persons
operating the Purchased Operations or performing Services hereunder,

     

     

    
      
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including any crew onboard Vessels, are and shall be Service Providers
hereunder.”

    

     

    3. Amendment to Article IV of
the Operating Agreement.  Section 4.1(a) of the Operating
Agreement is hereby amended by deleting the following therefrom:

     

     

    “,
provided that this Section 4.1(a) shall not prohibit Stockholder’s equity
ownership in Horizon Maritime for so long as the Asphalt Business Limitation is
satisfied”

     

    4. Amendment to Exhibit A to
the Operating Agreement.  Section 2(f) of Exhibit A to the
Operating Agreement is hereby amended and restated in its entirety to read as
follows:

     

    “Maintaining
the requisite level of financial responsibility required under one of the
mechanisms established in 33 C.F.R. § 138.80 with respect to the Purchase
Operations, filing any and all required forms, financial statements and
affidavits and performing any and all audits or certifications that may be
required by such regulations.”

     

    ARTICLE
III

    MISCELLANEOUS

     

    1. Effect on the Operating
Agreement.  The Operating Agreement, as amended by this
Amendment, shall remain in full force and effect and, as so amended, is hereby
ratified and affirmed in all respects.  On and after the date hereof,
each reference in the Operating Agreement to “this Agreement,” “herein,”
“hereunder” or words of similar import shall mean and be a reference to the
Operating Agreement as amended by this Amendment.

     

    2. Assignment, Successors and
No Third-Party Rights.  No party may assign any of its rights
or delegate any of its obligations under this Amendment without the prior
written consent of the other parties, except that the Owner may assign any of
its rights and delegate any of its obligations under this Amendment to a
subsidiary of the Partnership.  Subject to the preceding sentence,
this Amendment will apply to, be binding in all respects upon and inure to the
benefit of the heirs, executors, administrators, successors and permitted
assigns of the parties.  Nothing expressed or referred to in this
Agreement will be construed to give any Person other than the parties to this
Amendment any legal or equitable right, remedy or claim under or with respect to
this Agreement or any provision of this Agreement, except such rights as shall
inure to a successor or permitted assignee pursuant to this Section 2. of
Article III.

     

    3. Choice of
Law.  This Amendment shall be governed by the general maritime
laws of the United States, to the extent applicable, and otherwise by the
internal laws of the State of Texas (without regard to the choice of law
provisions thereof).

     

    4. Construction; Section
Headings; Table of Contents.  .  The
language used in this Amendment shall be deemed to be the language the parties
hereto have chosen to express their mutual intent, and no rule of strict
construction will be applied against any party hereto.  The section
headings contained in this Amendment are for reference purposes only and shall
not affect the meaning or interpretation of this Amendment.

     

     

    
      
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    5. Severability.  Any term
or provision (or subpart or portion thereof) of this Amendment which is invalid
or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Amendment or affecting the validity or enforceability of any of the terms or
provisions of this Amendment in any other jurisdiction.  If any
provision (or subpart or portion thereof) of this Amendment is so broad as to be
unenforceable, the provision shall be interpreted to be only so broad as is
enforceable.

     

    6. Counterparts.  This
Amendment may be executed in any number of counterparts, each of which shall be
deemed to be an original and all of which together shall be deemed to be one and
the same instrument.

     

    

     

    

     

    

    
      
        
           

        

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                          IN
WITNESS WHEREOF, the parties hereto have executed this Amendment on the date
first above written.

     

    

     

    TEPPCO
MARINE SERVICES, LLC

    

    

    

    By:               
/s/ WILLIAM G.
MANIAS

    William
G. Manias

    Vice President and

    Chief Financial Officer

    

    

    CENAC TOWING CO.,
INC.

    

    

    

    By:                 /s/
ARLEN B. CENAC, JR.

    Arlen B. Cenac, Jr.

    President

    

    

    CENAC OFFSHORE,
L.L.C.

    

    

    

    By:                /s/
ARLEN B. CENAC, JR.

    Arlen B. Cenac, Jr.

    Managing Member 

    

    
 

    
      	
                                
      /s/ ARLEN B. CENAC, JR.

              Arlen
      B. Cenac, Jr.exhibit10_7.htm

    
      Exhibit 10.7

    

     

    Option
Grant under the

    EPCO, Inc. 2006 TPP Long-Term
Incentive Plan

     

     

    
      	
              Date
      of Grant:

               

            	
              ____________________,
      200__

            
	
              Name
      of Optionee:

               

            	
              __________________________

            
	
              Option
      Exercise Price per Common Unit:

               

            	
              $_________
      (“Exercise Price”)

            
	
              Number
      of Options Granted (One

                    Option
      equals the Right to

                    Purchase
      One Common Unit):

               

            	
               

               

              _________

            
	
              Option
      Grant Number:

               

            	
              O08-_______

            

    

            EPCO,
Inc. (the “Company”) is pleased to inform you that you have been granted options
(the “Options”) under the EPCO, Inc. 2006 TPP Long-Term Incentive Plan (the
“Plan”) to purchase units representing limited partner interests (“Common
Units”) of TEPPCO Partners, L.P. (the “Partnership”) as follows:

     

            1.       
You are hereby granted the number of Options to acquire a Common Unit set forth
above, each such Option having the option exercise price set forth
above.

     

            2.       
The Options shall become fully vested (exercisable) on the earlier of (i) the
date that is four years after the Date of Grant set forth above (the “Vesting
Date”) and (ii) a Qualifying Termination.  A “Qualifying Termination”
means your employment with the Company and its Affiliates is terminated due to
your (a) death, (b) receiving long-term disability benefits under the
Company’s long-term disability plan provided such disability qualifies as a
“disability” under Section 409A of the Internal Revenue Code of 1986, as amended
(“Section 409A”), or (c) retirement with the approval of the Company on or after
reaching age 60.

     

            3.       
Subject to the further provisions of this Agreement and the Plan, the Options,
to the extent vested, may be exercised (in whole or in part or in two or more
successive parts) during your employment with the Company and its Affiliates
only during the month of February, May, August or November (a “Qualified Month”)
in the first (1st)
calendar year following the year in which the Vesting Date occurs (and the
Option will expire at the end of such year if it is not so
exercised).  In the event your employment with the Company and its
Affiliates is terminated prior to the Vesting Date for any reason other than a
Qualifying Termination, the Options shall automatically and immediately be
forfeited and cancelled unexercised on the date of such termination of
employment. For purposes of this Option grant award, the term “year” shall mean
a period comprised of 365 (or 366, as appropriate) days beginning on a day
of a calendar year and ending on the day immediately preceding
the corresponding day of the next calendar year. For example, if the Date
of Grant of an Option grant award is May 20, 2008, one year after the Date of
Grant would be May 20, 2009, the Vesting Date would be May 20, 2012
(assuming no earlier Qualifying Termination) and the calendar year in which the
Options could be exercised (except as described in Sections 7 and 8 hereof)
would be 2013.

     

            4.       
To the extent vested and subject to the procedures set forth in Addendum
No. 2, the Options may be exercised by submitting the “Options
Transaction Clearance Request and Tax Withholding Election” (“Transaction
Request”) with respect to such exercise which references the Option Grant Number
set forth above and the number of Options (or Common Units relating thereto)
which are being exercised. Such Transaction Request shall be delivered or mailed
to the Company at its corporate offices in Houston, Texas, as
follows:

     

            Mailing Address:
EPCO, Inc., P.O. Box 4324, Houston, Texas 77210-4324, Attention: Sr. Vice President, Human
Resources 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

            Delivery Address:
EPCO, Inc., 1100 Louisiana, 10th Floor, Houston, Texas 77002, Attention: Sr.
Vice President, Human
Resources

     

     

    An
election to exercise shall be made in accordance with Addendum
No. 2 and shall be irrevocable. If you are an employee of the Company or
an Affiliate and such exercise occurs other than in a Qualified Month, it shall
be deemed exercised in the next Qualified Month.

     

            5.       
No exercise shall be effective until you have made arrangements acceptable to
the Company and in accordance with the Plan to satisfy the aggregate Exercise
Price and all applicable tax withholding requirements of the Company, if any,
with respect to such exercise.

     

            6.       
None of the Options are transferable (by operation of law or otherwise) by you,
other than by will or the laws of descent and distribution. If, in the event of
your divorce, legal separation or other dissolution of your marriage, your
former spouse is awarded ownership of, or an interest in, all or part of the
Options granted hereby to you (the “Awarded Options”), (i) to the extent the
Awarded Options are not fully vested, the Awarded Options shall automatically
and immediately be forfeited and cancelled unexercised as of the original date
of the award thereof and (ii) to the extent the Awarded Options are fully
vested, the Company, in its sole discretion, may at any time thereafter, during
the period in which the Awarded Options are exercisable under the terms of the
domestic relations order providing for the assignment, cancel the Awarded
Options by delivering to such former spouse Common Units having an aggregate
Fair Market Value on the payment date equal to the excess of the aggregate Fair
Market Value of the Common Units subject to the Awarded Options over their
aggregate Exercise Price.

     

            7.       
In the event you terminate employment with the Company and its Affiliates for
any reason (which termination is a “separation from service” under Section 409A
of the Internal Revenue Code) other than a Qualifying Termination, the Options,
if fully vested, may be exercised by you (or, in the event of your death, by the
person to whom your rights shall pass by will or the laws of the descent and
distribution (“Beneficiary”)) only during the Qualified Month next following
your employment termination date.  If you cease to be an “active,
full-time employee”, as determined by the Company in its sole discretion,
without regard as to how your status is treated by the Company for any of its
other compensation or benefit plans or programs, you will be deemed to have
terminated employment with the Company and its Affiliates for purposes of this
Agreement.

     

            8.       
In the event of a Qualifying Termination or an “unforeseeable emergency” (as
defined in Section 409A) which is approved by the Company, the vested portion of
the Options may be exercised by you only during the Qualified Month next
following such event. Notwithstanding the above, in the event such Qualifying
Termination is due to your death, the vested portion of the Options may be
exercised by your Beneficiary only during the second Qualified Month next
following such event.

     

            9.       
Nothing in this Agreement or in the Plan shall confer any right on you to
continue employment with the Company or its Affiliates or restrict the Company
or its Affiliates from terminating your employment at any time. Unless you have
a separate written employment agreement with the Company or an Affiliate, you
are, and shall continue to be, an “at will” employee.

     

    
      
        
          -2-

        

         

      

      
         

        
          

        

      

      
         

      

    

     

            10.       
Notwithstanding any other provision of this Agreement, the Options shall not be
exercisable, and the Company shall not be obligated to deliver to you any Common
Units, if counsel to the Company determines such exercise or delivery, as the
case may be, would violate any law or regulation of any governmental authority
or agreement between the Company and any national securities exchange upon which
the Common Units are listed or any policy of the Company or any Affiliate of the
Company.

     

            11.       
Notwithstanding any other provision of this Agreement, if you give notice of
exercise within a “quiet period,” as provided in Addendum
No. 1 hereto, the timing of the delivery of Common Units pursuant to your
exercise shall be governed by the terms of Addendum
No. 1. Further, the Company shall have no liability to you for any loss
you may suffer (whether by a decrease in the value of the Common Units, failure
or inability to receive Partnership distributions or otherwise) from any delay
by the Company in delivering to you Common Units in connection with the whole or
partial exercise by you of the Options.

     

            12.       
These Options are subject to the terms of the Plan, which is hereby incorporated
by reference as if set forth in its entirety herein, including, without
limitation, the ability of the Company, in its discretion, to accelerate the
termination of the Option and to amend your Option grant award without your
approval. In the event of a conflict between the terms of this Agreement and the
Plan, the Plan shall be the controlling document. Capitalized terms that are
used, but are not defined, in this Option grant award have the respective
meanings provided for in the Plan. The Plan, as in effect on the Date of Grant,
is attached hereto as Exhibit
A.

     

    
      	 
      	
              EPCO,
      Inc.

            
	 
      
	 
      	
              By:_________________________________

            
	 
      	
                   ____________,
      Vice President

            

    

    

     

     

     

     

    

    

    
      -3-

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