UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): January 3, 2011 (December 28, 2010)

GENESIS ENERGY, L.P.
(Exact name of registrant as specified in its charter)

Delaware
1-12295
76-0513049
(State or other jurisdiction of incorporation or organization)
(Commission File Number)
(I.R.S. Employer Identification No.)

919 Milam, Suite 2100, Houston, Texas
77002
(Address of principal executive offices)
(Zip Code)

(713) 860-2500
(Registrant's telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

£
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

£
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240-14a-12)

£
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240-14d-2(b))

£
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240-13e-4(c))
 


 
 

 

Item 1.01. Entry into a Material Definitive Agreement

Agreement and Plan of Merger

On December 28, 2010, Genesis Energy, L.P. (“ Partners ”) completed the transactions contemplated in the Agreement and Plan of Merger, dated as of December 28, 2010 (the “ Merger Agreement ”), by and among Partners, Genesis Energy, LLC (“ Partners GP ”) and Genesis Acquisition, LLC (“ Merger Sub ”), a wholly owned subsidiary of Partners, whereby Merger Sub merged with and into Partners GP, with Partners GP as the surviving entity (the “ Merger ”).  The former unitholders of Partners GP (collectively, the “ Partners GP Unitholders ”) were issued in a transaction exempt from registration under the Securities Act of 1933, as amended (the “ Act ”), pursuant to Section 4(2) of the Act, inclusive of the Reserved Units (defined below), approximately 27,000,000 units, consisting of: (i) approximately 19,960,000 traditional common units which have been re-named “Common Units – Class A” (collectively, the “ Class A Units ”), (ii) 40,000 common units designated “Common Units – Class B” with rights, preferences and privileges of the Class A Units and rights to elect the board of directors of Partners GP (the “ Partners GP Board ”) and convertible into Class A Units (collectively, the “ Class B Units ”) and (iii) approximately 7,000,000 units designated “Waiver Units” convertible into Class A Units (collectively, the “ Waiver Units ”).  The Partners GP Unitholders included, directly or indirectly, members of the Partners GP Board and members of Partners management.  Please see Partners’ Current Report on Form 8-K dated February 11, 2010, for a more detailed description of the Partners GP Unitholders.  Pursuant to the Merger and the Fifth Amended and Restated Limited Partnership Agreement of Partners, the incentive distribution rights held by Partners GP were extinguished and the 2.0% general partner interest in Partners held by Partners GP was converted into a non-economic general partner interest.  The directors of the Partners GP Board before the Merger remained as directors after the Merger.  The Partners GP Unitholders, through the Class B Units and the Unitholder Rights Amendment (as defined below), have retained the right to elect directors to the Partners GP Board.

The Partners GP Board delegated to (i) the conflicts committee (the “ Conflicts Committee ”), comprised of independent directors (with Sharilyn S. Gasaway recusing herself), the authority of the Partners GP Board to negotiate the terms and conditions of the Merger with respect to Partners and (ii) the deal committee (the “ Deal Committee ”), the authority of the Partners GP Board to negotiate the terms and conditions of the Merger with respect to Partners GP.  The terms of the Merger Agreement were unanimously approved by the Conflicts Committee, the Deal Committee, the Partners GP Board and the Partners GP Unitholders.

The description of the Merger Agreement is qualified in its entirety by reference to the full text of the Merger Agreement, which is filed as Exhibit 2.1 hereto and incorporated in this Item 1.01 by reference.

The representations and warranties of the parties in the Merger Agreement were made only for purposes of that agreement and as of specific dates and were solely for the benefit of the other applicable parties thereto.  The Merger Agreement is a contractual document that establishes and governs the legal relations among the parties thereto and is not intended to be a source of factual, business, or operational information about Partners and its subsidiaries.  The representations and warranties made by the parties in the Merger Agreement may be (i) qualified by disclosure schedules containing information that modifies, qualifies or creates exceptions to such representations and warranties and (ii) subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors.  Accordingly, investors and security holders should not rely on such representations and warranties as any characterization of the actual state of facts or circumstances.

 
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Registration Rights Agreement

In connection with the Merger, Partners entered into a Registration Rights Agreement, dated as of December 28, 2010 (the “ IDR Registration Rights Agreement ”), with certain of the Partners GP Unitholders.  As described below, certain members of the Davison family of Ruston, Louisiana, and their affiliates (collectively, the “ Davisons ”), are party to an existing registration rights agreement and did not become parties to the IDR Registration Rights Agreement.

Pursuant to the IDR Registration Rights Agreement, Partners is required to file as soon as practical, but no later than April 6, 2011, a shelf registration statement providing for the resale of each Class A Unit issued in the Merger, including those converted from Waiver Units and Class B Units (collectively, the “ Registrable Units ”).  Partners is required to use its best efforts to cause such shelf registration statement to be declared effective by no later than June 8, 2011.  Holders of Registrable Units also have the right to demand registrations (subject to specified limitations) and up to seven underwritten offerings (but not more than one per calendar year), as well as piggy-back registration rights when Partners issues common units in a public offering, subject to exceptions.  None of such Class A Units issued in the Merger are eligible for resale under a registration statement prior to June 30, 2011.  After that date, 50% of the Class A Units are eligible for resale pursuant to a registration statement.  After December 30, 2011, all Registrable Units are eligible for resale pursuant to a registration statement.

Each Partners GP Unitholder (other than the Davisons) has rights under the IDR Registration Rights Agreement until the earlier of (i) December 31, 2020 or (ii) the date on which the Registrable Units are no longer “Registrable Securities,” as such term is defined in the Registration Rights Agreement.

The description of the IDR Registration Rights Agreement is qualified in its entirety by reference to the full text of the IDR Registration Rights Agreement, which is filed as Exhibit 10.1 hereto and incorporated in this Item 1.01 by reference.

Amendment No. 3 to Davison Registration Rights Agreement

The Davisons are party to that certain Registration Rights Agreement, dated as of July 25, 2007 (as amended, the “ Davison Registration Rights Agreement ”), which gives them various rights, subject to certain limitations, for the registration of their Partners units.  In connection with the Merger, the Davisons and Partners entered into an amendment to the Davison Registration Rights Agreement, dated as of December 28, 2010 (the “ Davison Registration Rights Amendment ”), with respect to the Class A Units they received in connection with the Merger (or issuable upon conversion of the Waiver Units received by them).  Among other things, the Davison Registration Rights Amendment (i) provides for the filing of a shelf registration statement with respect to such securities to the same extent as under the IDR Registration Rights Agreement, (ii) extends the term of the Davison Registration Rights Agreement to December 31, 2020 and (iii) increases the number of permitted underwritten offering demand rights from five to seven.  After giving effect to the Davison Registration Rights Amendment, the Davison Registration Rights Agreement grants substantially identical rights to and imposes substantially similar restrictions and limitations on, the Davisons, as does the IDR Registration Rights Agreement with respect to the other Partners GP Unitholders.

 
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The description of the Davison Registration Rights Amendment is qualified in its entirety by reference to the full text of the Davison Registration Rights Amendment, which is filed as Exhibit 10.2 hereto and incorporated in this Item 1.01 by reference.

Amendment No. 2 to Unitholder Rights Agreement

The Davisons are also party to that certain Unitholder Rights Agreement, dated as of July 25, 2007 (as amended, the “ Unitholder Rights Agreement ”), which, among other things, gives them the right to elect one or more directors.  In connection with the Merger, the Davisons, Partners and Partners GP entered into an amendment to the Unitholder Rights Agreement, dated as of December 28, 2010 (the “ Unitholder Rights Amendment ”), that grants the Davisons the right to elect up to three directors of the Partners GP Board based on the percentage of aggregate common units beneficially owned by them.   So long as the Davisons have the right to elect three directors, the Partners GP Board cannot have more than 11 directors without the Davisons’ consent .

The description of the Unitholder Rights Amendment is qualified in its entirety by reference to the full text of the Unitholder Rights Amendment, which is filed as Exhibit 10.3 hereto and incorporated in this Item 1.01 by reference.

Amendment No. 1 to Indemnification Agreement

The directors of Partners GP are party to indemnification agreements (collectively, the “ Indemnification Agreements ”), which provide for the indemnification of such directors on account of his or her services as a director of Partners GP (or service for another entity in any capacity at the request of the Partner or Partners GP) to the fullest extent permitted by law.  In connection with the Merger, each director entered into an amendment to his or her respective Indemnification Agreement (collectively, the “ Indemnification Amendments ”) to extend his or her pre-existing indemnification rights to provide for, among other things, insurance coverage during his or her respective term of service and for up to six years thereafter (subject to such insurance being reasonably available).

The description of the Indemnification Amendments is qualified in its entirety by reference to the full text to the form of Indemnification Amendment, which is filed as Exhibit 10.4 hereto and incorporated in this Item 1.01 by reference.

 
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Item 2.01.  Completion of Acquisition or Disposition of Assets

The information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated in this Item 2.01 by reference.

Item 3.02.  Unregistered Sales of Equity Securities

The information set forth in Item 1.01 and Item 5.03 of this Current Report on Form 8-K is incorporated in this Item 3.02 by reference.

Item 3.03.  Material Modification to Rights of Security Holders

The information set forth in Item 5.03 of this Current Report on Form 8-K is incorporated in this Item 3.03 by reference.

Item 5.03.  Amendments to Articles of Incorporation or Bylaws; Changes in Fiscal Year

Fifth Amended and Restated Agreement of Limited Partnership of Partners

In connection with the closing of the Merger, Partners GP entered into the Fifth Amended and Restated Agreement of Limited Partnership of Partners (the “ Fifth LP Agreement ”), dated December 28, 2010, and effective as of the effective time of the Merger (the “ Effective Time ”).  Among other things, the Fifth LP Agreement provides for the (i) cancellation of the IDRs, (ii) conversion of the 2.0% general partner interest into a non-economic general partner interest, and (iii) elimination of some unnecessary legacy provisions, including provisions related to the IDRs and the economic general partner interest.

In addition, the Fifth LP Agreement sets forth the rights of the Class A Units, the Class B Units, and the Waiver Units (which are divided into four classes).  The Class A Units are traditional common units and the Fifth LP Agreement renames all such common units the “Common Units – Class A.”  The Class B Units are identical to the Class A Units and, accordingly, have voting and distribution rights equivalent to those of the Class A Units, except, in addition, Class B Units have the right to elect all of the directors of the Partners GP Board (the “ Director Voting Right ”), subject to the Davisons’ right to elect up to three directors pursuant to the Unitholder Rights Agreement, and are convertible into Class A Units at the option of the holder or as noted below at the rate of one Class A Unit for each Class B Unit.  The holders of at least a majority of the common units (excluding such units held by affiliates of Partners GP) can replace the existing general partner with a successor general partner, and as a result remove the Director Voting Right and cause the Class B Units to convert into Class A Units.  The Waiver Units are non-voting securities entitled to a minimal preferential quarterly distribution of $0.001786 per unit per quarter and are comprised of four classes (designated Class 1, Class 2, Class 3 and Class 4) of 1,750,000 authorized units each.  The Waiver Units have the right to convert into Class A Units at the rate of one Class A Unit for each Waiver Unit in four equal installments (based on class) in the calendar quarter during which each of the Class A Units receives a quarterly distribution of at least $0.43, $0.46, $0.49 and $0.52, as applicable, if Partners’ distribution coverage ratio (after giving effect to the then convertible Waiver Units) would be at least 1.1 times.  In addition, the Waiver Units have the right to convert into Class A Units upon (i) a sale of Partners (including a sale of all or substantially all of its assets or a merger or other form of statutory reorganization), subject to approval of such transaction by the Conflicts Committee, and (ii) in the case of Waiver Units held by certain senior executives that were Partners GP Unitholders or participants in the incentive plan that may be created for approximately 145,620 Class A Units and 50,967 Waiver Units not issued in the Merger (collectively, the “ Reserved Units ”), automatically upon the death, disability or termination without “cause” of such person.

 
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The description of the Fifth LP Agreement is qualified in its entirety by reference to the full text of the Fifth LP Agreement, which is filed as Exhibit 3.1 hereto and incorporated in this Item 5.03 by reference.

Item 8.01.  Other Items

Second Amended and Restated Limited Liability Company Agreement of Partners GP

In connection with the closing of the Merger, the members of Partners GP and Partners GP entered into the Second Amended and Restated Limited Liability Company Agreement of Partners GP (the “ Second LLC Agreement ”), dated December 28, 2010, and effective as of the Effective Time.  The Second LLC Agreement provides for (i) a simplified structure for Partners in which Partners is the sole member of Partners GP and (ii) the election of the directors of the Partners GP Board by the holders of the Class B Units.

The description of the Second LLC Agreement is qualified in its entirety by reference to the full text of the Second LLC Agreement, which is filed as Exhibit 3.2 hereto and incorporated in this Item 8.01 by reference.

Press Release

A copy of the press release issued to announce the consummation of the transactions contemplated by the Merger Agreement is included as Exhibit 99.1 to this Current Report on Form 8-K.

Item 9.01.  Financial Statements and Exhibits

(d)  Exhibits

The following materials are filed as exhibits to this Current Report on Form 8-K.

Exhibits .

2.1 *         Agreement and Plan of Merger, dated as of December 28, 2010, by and among Genesis Energy, L.P., Genesis Acquisition LLC and Genesis Energy, LLC.

3.1             Fifth Amended and Restated Agreement of Limited Partnership of Genesis Energy, L.P., dated as of December 28, 2010.

 
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3.2             Second Amended and Restated Limited Liability Company Agreement of Genesis Energy, LLC, dated as of December 28, 2010.

10.1           Registration Rights Agreement, dated as of December 28, 2010, by and among Genesis Energy, L.P. and the former unitholders of Genesis Energy, LLC.

10.2           Amendment No. 3 to Davison Registration Rights Agreement, dated as of December 28, 2010, by and among Genesis Energy, L.P. and certain members of the Davison family of Ruston, Louisiana, and their affiliates.

10.3           Amendment No. 2 to Unitholder Rights Agreement, dated as of December 28, 2010, by and among Genesis Energy L.P., Genesis Energy LLC and certain members of the Davison family of Ruston, Louisiana, and their affiliates.

10.4           Form of Amendment No. 1 to Indemnification Agreement with the directors of Genesis Energy, LLC.

99.1           Genesis Energy, L.P. press release, dated December 28, 2010.

*A list of all the exhibits and schedules to such agreement appears on page (ii) thereto.  Pursuant to Item 601(b)(2) of Regulation S-K, the Registrant agrees to furnish supplementally a copy of any such omitted exhibit or schedule to the SEC upon request.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
   
GENESIS ENERGY, L.P., by
       
   
GENESIS ENERGY, LLC, its sole general partner
 
       
Date: January 3, 2011
By:
/s/  ROBERT V. DEERE
 
   
       Robert V. Deere
 
   
       Chief Financial Officer
 

 
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EXHIBIT INDEX

2.1 *         Agreement and Plan of Merger, dated as of December 28, 2010, by and among Genesis Energy, L.P., Genesis Acquisition LLC and Genesis Energy, LLC.

5.1             Fifth Amended and Restated Agreement of Limited Partnership of Genesis Energy, L.P., dated as of December 28, 2010.

5.2             Second Amended and Restated Limited Liability Company Agreement of Genesis Energy, LLC, dated as of December 28, 2010.

10.1           Registration Rights Agreement, dated as of December 28, 2010, by and among Genesis Energy, L.P. and the former unitholders of Genesis Energy, LLC.

10.2           Amendment No. 3 to Davison Registration Rights Agreement, dated as of December 28, 2010, by and among Genesis Energy, L.P. and certain members of the Davison family of Ruston, Louisiana, and their affiliates.

10.3           Amendment No. 2 to Unitholder Rights Agreement, dated as of December 28, 2010, by and among Genesis Energy L.P., Genesis Energy LLC and certain members of the Davison family of Ruston, Louisiana, and their affiliates.

10.4           Form of Amendment No. 1 to Indemnification Agreement with the directors of Genesis Energy, LLC.

99.1           Genesis Energy, L.P. press release, dated December 28, 2010.

*A list of all the exhibits and schedules to such agreement appears on page (ii) thereto.  Pursuant to Item 601(b)(2) of Regulation S-K, the Registrant agrees to furnish supplementally a copy of any such omitted exhibit or schedule to the SEC upon request.
 
 
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Exhibit 2.1
 
Execution Copy
 


 
AGREEMENT AND PLAN OF MERGER

by and among

GENESIS ENERGY, L.P.,
GENESIS ACQUISITION, LLC

and

GENESIS ENERGY, LLC


Dated as of December 28, 2010
 
 


 
 

 

TABLE OF CONTENTS

   
Page
     
ARTICLE I
CERTAIN DEFINITIONS
     
Section 1.1
Certain Definitions
2
     
ARTICLE II
THE MERGER; EFFECTS OF THE MERGER
     
Section 2.1
The Merger
8
Section 2.2
Closing
9
     
ARTICLE III
MERGER CONSIDERATION; EXCHANGE PROCEDURES
     
Section 3.1
Merger Consideration.
9
Section 3.2
Rights As Unitholders; Unit Transfers.
9
Section 3.3
Exchange Procedures.
10
     
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
     
Section 4.1
Representations and Warranties
11
     
ARTICLE V
COVENANTS
     
Section 5.1
Indemnification; Directors’ and Officers’ Insurance
17
     
ARTICLE VI
MISCELLANEOUS
     
Section 6.1
Waiver; Amendment
20
Section 6.2
Counterparts
20
Section 6.3
Governing Law
20
Section 6.4
Notices
20
Section 6.5
Entire Understanding; No Third Party Beneficiaries
21
Section 6.6
Severability
21
Section 6.7
Headings
22
Section 6.8
Jurisdiction
22
Section 6.9
Waiver of Jury Trial
22
Section 6.10 
Specific Performance
22
Section 6.11
Survival
22
Section 6.12
No Act or Failure to Act
22
Section 6.13
Termination
23

 
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ANNEXES

ANNEX A
Form of Fifth Amended and Restated Partnership Agreement of Partners
A-1
ANNEX B
Form of Second Amended and Restated Limited Liability Company Agreement of Partners GP
B-1

SCHEDULES

Schedule A
Allocation of Merger Consideration
Schedule B
Partners Disclosure Schedule
 
Schedule 4.1(c) - Subsidiaries
Schedule C
Partners GP Disclosure Schedule
 
Schedule 4.1(c) – Subsidiaries
 
Schedule 4.1(g) – Financial Reports and SEC Documents

 
ii

 

AGREEMENT AND PLAN OF MERGER

This AGREEMENT AND PLAN OF MERGER, dated as of December 28, 2010 (this “ Agreement ”), is entered into by and among Genesis Energy, L.P., a Delaware limited partnership (“ Partners ”), Genesis Acquisition, LLC, a Delaware limited liability company (“ MergerCo ”), and Genesis Energy, LLC, a Delaware limited liability company (“ Partners GP ”).

WITNESSETH:

WHEREAS, each of the Deal Committee and Conflicts Committee (each, as defined herein) of the board of directors of Partners GP (the “ Partners GP Board ”), was delegated by the Partners GP Board with the authority of the Partners GP Board with respect to Partners GP and Partners, respectively, to negotiate the terms and conditions of a restructuring transaction (a “ Restructuring Transaction ”) with respect to, among other things, the Incentive Distribution Rights and Partners General Partnership Interest (each, as defined herein), and, if appropriate, recommend a Restructuring Transaction for final approval by the Partners GP Board;

WHEREAS, the Deal Committee and Conflicts Committee have negotiated the Restructuring Transaction contemplated by this Agreement pursuant to which MergerCo will, subject to the terms and conditions set forth herein, merge with and into Partners GP, with Partners GP being the surviving entity (the “ Merger ”), such that following the Merger, Partners will be the sole member of the Surviving Entity (as defined herein), and the Surviving Entity will be the sole general partner of Partners;

WHEREAS, the Deal Committee has determined that the Merger, this Agreement and the transactions contemplated hereby, including the Partners GP Amended and Restated LLC Agreement (as defined herein), are fair and reasonable to, and in the best interests of, Partners GP and its unitholders, approved and declared the advisability of the Merger, this Agreement and the Partners GP Amended and Restated LLC Agreement and has resolved to recommend that the Partners GP Board approve the Merger, this Agreement and the Partners GP Amended and Restated LLC Agreement;

WHEREAS, the Partners GP Board, with respect to Partners GP, has determined that the Merger, this Agreement and the transactions contemplated hereby, including the Partners GP Amended and Restated LLC Agreement, are fair and reasonable to, and in the best interests of, Partners GP and its unitholders, and approved and declared the advisability of the Merger, this Agreement, and the Partners GP Amended and Restated LLC Agreement and resolved to recommend that the Quintana Entity (as defined in the Partners GP LLC Agreement (as defined herein)) and holders of Partners GP Series A Units and Partners GP Series B Units (each, as defined herein)   approve the Merger, this Agreement and the transactions contemplated hereby;

WHEREAS, the Quintana Entity and holders of at least a majority of each of the Partners GP Series A Units and Partners GP Series B Units have approved the Merger, this Agreement and the transactions contemplated hereby;

WHEREAS, the Conflicts Committee (a) has determined that this Agreement and the transactions contemplated hereby, including the Merger Transactions (as defined herein), are fair and reasonable to Partners and the limited partners of Partners who are unaffiliated with the General Partner, (b) has approved the Agreement and the Merger Transactions by Special Approval (as defined in the Partners Partnership Agreement), and (c) has recommended to the Partners GP Board that it approve this Agreement and the Merger Transactions;

 
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WHEREAS, the Partners GP Board, with respect to Partners, has determined that this Agreement and the transactions contemplated hereby, including the Merger Transactions, are fair and reasonable to, and in the best interests of, Partners and its unitholders and has approved this Agreement and the Merger Transactions;

WHEREAS, simultaneously with the execution and delivery of this Agreement, Partners and the Partners GP unitholders, are executing and delivering in connection with the New Partners Unit Issuance (as defined herein) either (i) a registration rights agreement or (ii) an Amendment No. 3 to that certain Registration Rights Agreement, as amended through the date hereof, by and among the Unitholders (as defined therein) and Partners, dated as of July 25, 2007, each in the form previously agreed upon by the parties;

WHEREAS, simultaneously with the execution and delivery of this Agreement, Partners, Partners GP and certain of Partners GP unitholders are executing and delivering in connection with the New Partners Unit Issuance an amendment to the Unitholder Rights Agreement (as defined herein); and

WHEREAS, the parties hereto desire to make certain representations, warranties and agreements in connection with the Merger and also to prescribe various conditions to the Merger;

NOW, THEREFORE, in consideration of the premises and the respective representations, warranties, covenants, agreements and conditions contained herein, the parties hereto agree as follows:

ARTICLE I
CERTAIN DEFINITIONS

Section 1.1              Certain Definitions .  As used in this Agreement, the following terms shall have the meanings set forth below:

Action ” shall have the meaning set forth in Section 5.1(a) .

Affiliate ” shall have the meaning set forth in Rule 405 of the Securities Act, unless otherwise expressly stated herein.

Aggregate Merger Consideration ” means, collectively, (i) 19,814,380.0000 Common Units – Class A, (ii) 40,000.0000 Common Units – Class B and (iii) (A) 1,737,258.2500 Waiver Units – Class 1, (B) 1,737,258.2500 Waiver Units – Class 2, (C) 1,737,258.2500 Waiver Units – Class 3, and (D) 1,737,258.2500 Waiver Units – Class 4.

Agreement ” shall have the meaning set forth in the introductory paragraph to this Agreement and Plan of Merger.

 
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Certificate of Merger ” shall have the meaning set forth in Section 2.1(b) .

Claim ” shall have the meaning set forth in Section 5.1(a) .

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

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

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

Conflicts Committee ” shall mean the Conflicts Committee of the Partners GP Board, consisting (as of the date hereof) of Kenneth M. Jastrow, S. James Nelson, Sharilyn S. Gasaway and Carl A. Thomason (with Sharilyn S. Gasaway recusing herself).

Deal Committee ” shall mean the Deal Committee of the Board of Directors of Partners GP, consisting (as of the date hereof) of Grant E. Sims, Robert C. Sturdivant and Corbin J. Robertson III.

Disclosure Schedule ” shall have the meaning set forth in Section 4.1 .

DLLCA ” shall mean the Delaware Limited Liability Company Act, 6 Del.C.   §18-101 et seq.

DRULPA ” shall mean the Delaware Revised Uniform Limited Partnership Act, 6 Del.C.   §17-101 et seq.

Effective Time ” shall have the meaning set forth in Section 2.1(b) .

ERISA ” shall mean the Employee Retirement Income Security Act of 1974, as amended.

Exchange Act ” shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.

Governmental Authority ” shall mean any national, state, local, county, parish or municipal government, domestic or foreign, any agency, board, bureau, commission, court, tribunal, subdivision, department or other governmental or regulatory authority or instrumentality, or any arbitrator in any case that has jurisdiction over Partners GP or Partners, as the case may be, or any of their respective properties or assets.

Incentive Distribution Rights ” shall have the meaning set forth in the Partners Partnership Agreement.

Indemnification Expenses ” shall have the meaning set forth in Section 5.1(a) .

Indemnified Parties ” shall have the meaning set forth in Section 5.1(a) .

 
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Indemnitees ” shall mean Members, Officers and Directors (each as defined in the Partners GP LLC Agreement) of Partners GP and, as the context requires, persons entitled to indemnification under the Partners GP LLC Agreement.

Law ” shall mean any law, rule, regulation, directive, ordinance, code, governmental determination, guideline, judgment, order, treaty, convention, governmental certification requirement or other legally enforceable requirement, U.S. or non-U.S., of any Governmental Authority.

Lien ” shall mean any charge, mortgage, pledge, security interest, restriction, claim, lien, or encumbrance.

Material Adverse Effect ” shall mean, with respect to either Partners GP or Partners, any effect that (x) is or could reasonably be expected to be material and adverse to the financial position, results of operations, business, assets or prospects of Partners GP and its Subsidiaries taken as a whole, or Partners and its Subsidiaries taken as a whole, respectively, or (y) materially impairs or could reasonably be expected to materially impair the ability of Partners GP or Partners, respectively, to perform its obligations under this Agreement or otherwise materially threaten or materially impede the consummation of the Merger and the other transactions contemplated by this Agreement; provided , however , that Material Adverse Effect shall not be deemed to include any of the following or the impact thereof: (a) circumstances affecting crude oil, petroleum product and industrial gases transportation, terminalling, storage, blending, distribution, marketing and processing industry (including the price of petroleum products and industrial gases and the costs associated with the transportation, terminalling, storage, blending, distribution, marketing and processing thereof), in any region in which Partners operates, (b) any general market, economic, financial or political conditions, or outbreak or hostilities or war, in the United States or elsewhere, (c) changes in Law, (d) earthquakes, hurricanes, floods, or other natural disasters, (e) any failure of Partners GP or Partners to meet any internal or external projections, forecasts or estimates of revenue or earnings for any period, (f) changes in the market price or trading volume of Partners Common Units – Class A, (g) the announcement or pendency of this Agreement or the matters contemplated hereby or the compliance by either party with the provisions of this Agreement, or (h) with respect to Partners GP only, any effect to the extent resulting from a fact, event or circumstance that has a Material Adverse Effect with respect to Partners under clause (x) of this definition; provided , that, in the case of clauses (a), (b), (c) or (d), the impact on Partners GP or Partners is not disproportionately adverse as compared to others in the industry.

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

Merger Consideration ” shall have the meaning set forth in Section 3.1(a) .

MergerCo ” shall have the meaning set forth in the introductory paragraph in this Agreement.

MergerCo Certificate of Formation ” shall mean the certificate of formation of MergerCo as filed with the Delaware Secretary of State on December 16, 2010, as amended from time to time.

 
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Merger Transactions ” shall have the meaning set forth in Section 4.1(p) .

New Partners Unit Issuance ” shall mean the issuance of the New Partners Units as part of the Merger Consideration pursuant to this Agreement.

New Partners Common Units – Class A ” shall have the meaning set forth in Section 3.1(a) .

New Partners Common Units – Class B ” shall have the meaning set forth in Section 3.1(a) .

New Partners Waiver Units ” shall have the meaning set forth in Section 3.1(a) .

New Partners Units ” shall mean the New Partners Common Units – Class A, New Partners Common Units – Class B and New Partners Waiver Units.

NYSE ” shall mean the New York Stock Exchange.

OLP ” means Genesis Crude Oil, L.P., a Delaware limited partnership.

Partners ” shall have the meaning set forth in the introductory paragraph to this Agreement.

Partners Amended and Restated Partnership Agreement ” shall mean the Fifth Amended and Restated Agreement of Limited Partnership of Partners substantially in the form attached hereto as Annex A .

Partners Certificate of Limited Partnership ” shall mean the certificate of limited partnership of Partners as filed with the Delaware Secretary of State on September 5, 1996, as amended.

Partners Common Units – Class A ” shall mean the common units representing limited partner interests in Partners having the rights and obligations specified with respect to Common Units in the Partners Partnership Agreement and the Common Units – Class A in the Partners Amended and Restated Partnership Agreement.

Partners Common Units – Class B ” shall mean the common units representing limited partner interests in Partners having the rights and obligations specified with respect to Common Units – Class B in the Partners Amended and Restated Partnership Agreement.

Partners Disclosure Schedule ” shall mean the Disclosure Schedule delivered by Partners pursuant to Section 4.1 .

Partners General Partner Interest ” shall mean the 2.0% ownership interest of Partners GP in Partners having the rights and obligations specified with respect to the General Partner Interest in the Partners Partnership Agreement.

 
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Partners GP ” shall have the meaning set forth in the introductory paragraph to this Agreement.

Partners GP Amended and Restated LLC Agreement ” shall mean the Second Amended and Restated Limited Liability Company Agreement of Partners GP substantially in the form attached hereto as Annex B .

Partners GP Certificate of Formation ” shall mean the certificate of formation of Partners GP, as filed with the Delaware Secretary of State on December 29, 2008.

Partners GP Disclosure Schedule ” shall mean the Disclosure Schedule delivered by Partners GP pursuant to Section 4.1 .

Partners GP LLC Agreement ” shall mean the Amended and Restated Limited Liability Company Agreement of Partners GP, dated as of February 5, 2010, as amended from time to time.

Partners GP Series A Units ” means the Series A Units representing membership interests in Partners GP having the rights and obligations specified with respect to the Series A Units in the Partners GP LLC Agreement.

Partners GP Series B Units ” means the Series B Units representing membership interests in Partners GP having the rights and obligations specified with respect to the Series B Units in the Partners GP LLC Agreement.

Partners GP Units ” shall mean the Partners GP Series A Units and Partners GP Series B Units having the rights and obligations specified with respect to Partners GP Series A Units and Partners GP Series B Units, respectively, in the Partners GP LLC Agreement.

Partners LTIP ” means Partners 2007 Long Term Incentive Plan.

Partners Partnership Agreement ” shall mean the Fourth Amended and Restated Agreement of Limited Partnership of Partners, dated as of June 9, 2005, as amended by Amendment No. 1 thereto, dated as of December 18, 2007, as further amended by Amendment No. 2 thereto, dated as March 31, 2010, and as it may be further amended from time to time.

Partners Waiver Units ” shall mean, collectively, the Partners Waiver Units – Class 1, the Partners Waiver Units – Class 2, the Partners Waiver Units – Class 3 and the Partners Waiver Units – Class 4.  The parties hereto agree that each Waiver Unit shall have an initial Capital Account (as defined in the Partners Amended and Restated Partnership Agreement) of $0.142857.

Partners Waiver Units – Class 1 ” shall mean the units representing limited partner interests in Partners having the rights and obligations specified with respect to the Waiver Units – Class 1 in the Partners Amended and Restated Partnership Agreement.

 
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Partners Waiver Units – Class 2 ” shall mean the units representing limited partner interests in Partners having the rights and obligations specified with respect to the Waiver Units – Class 2 in the Partners Amended and Restated Partnership Agreement.

Partners Waiver Units – Class 3 ” shall mean the units representing limited partner interests in Partners having the rights and obligations specified with respect to the Waiver Units – Class 3 in the Partners Amended and Restated Partnership Agreement.

Partners Waiver Units – Class 4 ” shall mean the units representing limited partner interests in Partners having the rights and obligations specified with respect to the Waiver Units – Class 4 in the Partners Amended and Restated Partnership Agreement.

Person ” or “ person ” shall mean any individual, bank, corporation, partnership, limited liability company, association, joint-stock company, business trust or unincorporated organization.

Reserved Units ” shall have the meaning set forth in Section 5.2 .

Restructuring Transaction ” shall have the meaning set forth in the recitals of this Agreement.

Rights ” shall mean, with respect to any person, securities or obligations convertible into or exchangeable for, or giving any person any right to subscribe for or acquire, or any options, calls or commitments relating to, equity securities of such person.

SEC ” shall mean the Securities and Exchange Commission.

SEC Documents ” shall have the meaning set forth in Section 4.1(g) .

Securities Act ” shall mean the Securities Act of 1933, as amended, and the rules and regulations thereunder.

Subsidiary ” shall have the meaning ascribed to such term in Rule 1-02 of Regulation S-X under the Securities Act, except, in the case of Partners GP, Partners and its Subsidiaries shall not be deemed to be Subsidiaries of Partners GP (unless otherwise specifically provided in this Agreement).

Surviving Entity ” shall have the meaning set forth in Section 2.1(a) .

Takeover Law ” shall mean any “fair price,” “moratorium,” “control share acquisition,” “business combination” or any other anti-takeover statute or similar statute enacted under state or federal law.

Taxes ” shall mean all taxes, charges, fees, levies or other assessments, including, without limitation, all net income, gross income, gross receipts, sales, use, ad valorem, goods and services, capital, transfer, franchise, profits, license, withholding, payroll, employment, employer health, excise, estimated, severance, stamp, occupation, property or other taxes, custom duties, fees, assessments or charges of any kind whatsoever, together with any interest and any penalties, additions to tax or additional amounts imposed by any taxing authority, whether disputed or not.

 
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Tax Law ” shall mean any Law relating to Taxes.

Tax Returns ” shall have the meaning set forth in Section 4.1(i) .

Unitholder Rights Agreement ” shall mean that certain Unitholder Rights Agreement, dated July 25, 2007, among Partners, Partners GP and the other parties thereto, as amended on October 15, 2007.

ARTICLE II
THE MERGER; EFFECTS OF THE MERGER

Section 2.1              The Merger .

(a)             The Surviving Entity .  Subject to the terms and conditions of this Agreement, at the Effective Time, MergerCo shall merge with and into Partners GP, the separate existence of MergerCo shall cease and Partners GP shall survive and continue to exist as a Delaware limited liability company (Partners GP, as the surviving entity in the Merger, sometimes being referred to herein as the “ Surviving Entity ”), such that following the Merger, Partners will be the sole member of Partners GP and Partners GP will be the sole general partner of Partners.  Subject to the provisions of this Agreement, at the Effective Time, all of the membership interests in MergerCo outstanding immediately prior to the Merger shall be converted, by virtue of the Merger and without any action on the part of the holder thereof, into all of the membership interests in the Surviving Entity, which membership interests in the Surviving Entity shall constitute all of the issued and outstanding membership interests of the Surviving Entity and shall be owned by Partners.

(b)             Effectiveness and Effects of the Merger .  The Merger shall become effective upon the later to occur of the filing in the office of the Secretary of State of the State of Delaware of a properly executed certificate of merger (the “ Certificate of Merger ”) or such later date and time as may be set forth in the Certificate of Merger (the “ Effective Time ”), in accordance with the DLLCA.  The Merger shall have the effects prescribed in the DLLCA.

(c)             Partners GP and MergerCo Governing Documents .  At the Effective Time, the MergerCo Certificate of Formation shall be cancelled and the Partners GP Certificate of Formation shall be the certificate of formation of the Surviving Entity, until duly amended in accordance with applicable Law.  At the Effective Time, (i) the Partners GP LLC Agreement shall be amended and restated in its entirety to read as set forth in Annex B and as so amended and restated shall be the limited liability company agreement of the Surviving Entity until duly amended in accordance with the terms thereof and applicable Law, and following such amendment and restatement, Partners GP shall be the sole general partner of Partners and (ii) the Partners Partnership Agreement shall be amended and restated in its entirety to read as set forth in Annex A , and as so amended and restated shall be the limited partnership agreement of Partners until duly amended in accordance with the terms thereof and applicable law and pursuant to such amendment and restatement, the Incentive Distribution Rights shall be canceled and the Partners General Partner Interest owned by Partners GP shall be converted to a non-economic general partner interest in Partners.

 
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Section 2.2              Closing .  The Merger and the other transactions contemplated hereby (the “ Closing ”) shall occur on December 28, 2010, and such date is referred to as the “ Closing Date .”  The Closing of the transactions contemplated by this Agreement shall take place at the offices of Akin Gump Strauss Hauer & Feld LLP, 1111 Louisiana, 44 th Floor, Houston, Texas 77002 at 9:00 a.m. Central Time on the Closing Date.

ARTICLE III
MERGER CONSIDERATION; EXCHANGE PROCEDURES

Section 3.1              Merger Consideration .   Subject to the provisions of this Agreement, at the Effective Time, by virtue of the Merger and without any action on the part of Partners, Partners GP or any holder of Partners GP Units:

(a)            The Partners GP Units issued and outstanding immediately prior to the Effective Time (other than Partners or Partners’ Subsidiaries, if any) shall be converted into the right to receive the Aggregate Merger Consideration, with each such holder to receive a number of (i) Partners Common Units – Class A, (ii) Partners Common Units – Class B, (iii) Partners Waiver Units – Class 1, (iv) Partners Waiver Units – Class 2, (v) Partners Waiver Units – Class 3, and (v) Partners Waiver Units – Class 4, as set forth on Schedule A (collectively, the “ Merger Consideration ”), all of which shall be duly authorized and validly issued in accordance with applicable Laws and the Partners Partnership Agreement and the Partners Amended and Restated Partnership Agreement, as applicable, fully paid (to the extent required under the Partners Partnership Agreement and the Partners Amended and Restated Partnership Agreement, as applicable) and non-assessable (except to the extent such non-assessability may be affected by Sections 17-303, 17-607 and 17-804 of the DRULPA) (such Partners Common Units – Class A, Partners Common Units – Class B and Partners Waiver Units described in this clause (a) shall be referred to herein as the “ New Partners Common Units – Class A ”, “ New Partners Common Units – Class B ” and “ New Partners Waiver Units ”, respectively).

Section 3.2              Rights As Unitholders; Unit Transfers. At the Effective Time, holders of Partners GP Units shall cease to be, and shall have no rights as, members of Partners GP (and all Partners GP Units, when converted in the Merger, shall cease to be outstanding and shall automatically be cancelled and cease to exist), other than to receive i) any distribution with respect to such Partners GP Units with a record date occurring prior to the Effective Time that may have been declared by Partners GP on such Partners GP Units in accordance with the terms of this Agreement and the Partners GP LLC Agreement and which remains unpaid at the Effective Time, ii) the consideration provided under this Article III and iii) any distributions in accordance with Section 3.3(b) , and in each case to be issued or paid in consideration therefor in accordance with Section 3.3 .  After the Effective Time, there shall be no transfers on the unit transfer books of Partners GP with respect to the Partners GP Units.

 
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Section 3.3              Exchange Procedures.

(a)            Prior to the Effective Time, Partners shall have delivered to each record holder of Partners GP Units (1) a letter of transmittal and (2) instructions for use in effecting the surrender of Partners GP Units in exchange for the Merger Consideration payable in respect of such Partners GP Units.  Promptly at or after the Effective Time, upon delivery of such letters of transmittal, properly completed and duly executed, and such other documents as may be required pursuant to such instructions, the holders of Partners GP Units shall be entitled to receive in exchange therefor (a) New Partners Units representing, in the aggregate, the whole number of New Partners Units that such holder has the right to receive pursuant to this Article III (after taking into account all Partners GP Units then held by such holder) and (b) a check in the amount equal to the aggregate amount of cash that such holder has the right to receive pursuant to this Article III , including cash payable in lieu of any fractional New Partners Common Units – Class A pursuant to Section 3.3(d) and distributions pursuant to Section 3.3(b) .  No interest shall be paid or accrued on any Merger Consideration.  In the event of a transfer of ownership of Partners GP Units that is not registered in the transfer records of Partners GP, the Merger Consideration payable in respect of such Partners GP Units may be paid to a transferee, if evidence of ownership of the Partners GP Units are presented to Partners and accompanied by all documents required to evidence and effect such transfer, and the Person requesting such exchange shall pay to Partners in advance any transfer or other Taxes required by reason of the delivery of the Merger Consideration in any name other than that of the record holder of such Partners GP Units, or shall establish to the satisfaction of Partners that such Taxes have been paid or are not payable.  Until the required documentation has been delivered as contemplated by this Section 3.3 , each Partners GP Unit shall be deemed at any time after the Effective Time to represent only the right to receive upon such surrender the Merger Consideration payable in respect of the Partners GP Units (including any cash in lieu of fractional units pursuant to Section 3.3(d) ) and any distributions to which such holder is entitled pursuant to Section 3.2 .

(b)             Distributions with Respect to Unexchanged Partners GP Units .  No distributions declared or made with respect to New Partners Units with a record date after the Effective Time shall be paid to the holder of any Partners GP Units with respect to the New Partners Units that such holder would be entitled to receive in accordance herewith and no cash payment in lieu of fractional New Partners Common Units – Class A shall be paid to any such holder until such holder shall deliver the required documentation and surrender any Certificate as contemplated by this Section 3.3 .  Subject to applicable Law, following compliance with the requirements of Section 3.3(a) , there shall be paid to such holder of the New Partners Units issuable in exchange therefor, without interest, (3) promptly after the time of such compliance, the amount of any cash payable in lieu of fractional New Partners Units to which such holder is entitled pursuant to Section 3.3(d) and the amount of distributions with a record date after the Effective Time theretofore paid with respect to the New Partners Units and payable with respect to such New Partners Units, and (4) at the appropriate payment date, the amount of distributions with a record date after the Effective Time but prior to such surrender and a payment date subsequent to such compliance payable with respect to such New Partners Units.

(c)             Further Rights in Partners GP Units .  The Merger Consideration issued upon conversion of a Partners GP Unit in accordance with the terms hereof and any cash paid pursuant to Section 3.2 , Section 3.3(b) or Section 3.3(d) shall be deemed to have been issued and paid in full satisfaction of all rights pertaining to such Partners GP Unit.

 
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(d)             Fractional Units .  No certificates or scrip of the New Partners Units representing fractional New Partners Units or book entry credit of the same shall be issued upon the exchange of Partners GP Units in accordance with Section 3.3(a) , and such fractional interests will not entitle the owner thereof to vote or to have any rights as a holder of any New Partners Units.  Notwithstanding any other provision of this Agreement, each holder of Partners GP Units exchanged in the Merger who would otherwise have been entitled to receive a fraction of a New Partners Unit (after taking into account all Partners GP Units exchanged by such holder), as set forth on Schedule A , shall receive, in lieu thereof, cash (without interest rounded up to the nearest whole cent) in an amount equal to the product of (A) the closing sale price of the Partners Common Units – Class A on the NYSE as reported by The Wall Street Journal on the trading day immediately preceding the date on which the Effective Time shall occur and (B) the fraction of a New Partners Unit that such holder would otherwise be entitled to receive pursuant to this Article III .

(e)             Withholding .  Each of Partners and the Surviving Entity shall be entitled to deduct and withhold from the consideration otherwise payable pursuant to this Agreement to any holder of Partners GP Units such amounts as Partners and the Surviving Entity are required to deduct and withhold under the Code or any provision of state, local, or foreign Tax Law, with respect to the making of such payment; provided, however , that Partners or the Surviving Entity, as the case may be, shall provide reasonable notice to the applicable holders of Partners GP Units prior to withholding any amounts pursuant to this Section 3.3(e) .  To the extent that amounts are so deducted and withheld by Partners or the Surviving Entity, such amounts shall be treated for all purposes of this Agreement as having been paid to the holder of Partners GP Units in respect of whom such deduction and withholding was made by Partners or the Surviving Entity, as the case may be.

(f)             Admission of Holders of New Partners Units as Additional Limited Partners of Partners .  Upon the issuance of New Partners Units to the holders of Partners GP Units in accordance with this Section 3.3 and the compliance by such holders with the requirements of Section 10.3 of the Partners Amended and Restated Partnership Agreement, Partners GP shall consent to the admission of such holders as limited partners of Partners and reflect such admission on the books and records of Partners.

ARTICLE IV
REPRESENTATIONS AND WARRANTIES

Section 4.1              Representations and Warranties .  On or prior to the date hereof, Partners has delivered to Partners GP and Partners GP has delivered to Partners a schedule (respectively, its “ Disclosure Schedule ”) setting forth, among other things, items the disclosure of which is necessary or appropriate in relation to any or all of its representations and warranties; provided , however , that (a) no such item is required to be set forth in a Disclosure Schedule as an exception to a representation or warranty if its absence is not reasonably likely to result in the related representation or warranty being deemed untrue or incorrect in any material respect, and (b) the mere inclusion of an item in a Disclosure Schedule shall not be deemed an admission by a party that such item represents a material exception or fact, event or circumstance or that such item is reasonably likely to result in a Material Adverse Effect.  Subject to the preceding sentence and except as set forth in its Disclosure Schedule or the SEC Documents (other than with respect to Sections 4.1(a) and 4.1(b) ) filed and publicly available prior to the date hereof (excluding any disclosures included therein to the extent they are cautionary, predictive or forward-looking in nature, including those in any risk factor section of such documents), Partners GP hereby represents and warrants to Partners, and Partners and MergerCo hereby represent and warrant  to Partners GP, to the extent applicable, in each case with respect to itself and its Subsidiaries, as follows:

 
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(a)             Organization, Standing and Authority .  Such party is a limited partnership or limited liability company, duly organized, validly existing and in good standing under the Laws of the jurisdiction of its organization.  Such party (i) is duly qualified to do business and is in good standing in the states of the United States where its ownership or leasing of property or the conduct of its business requires it to be so qualified and (ii) has in effect all federal, state, local, and foreign governmental authorizations and permits necessary for it to own or lease its properties and assets and to carry on its business as it is now conducted.

(b)             Capitalization.

In the case of Partners GP, as of the date hereof, there are 100,472,196.11 Partners GP Series A Units issued and outstanding and 767 Partners GP Series B Units (all of which are designated as Series B-1 Units) issued and outstanding, and all such Partners GP Units and the membership interests represented thereby were duly authorized and are validly issued in accordance with the Partners GP LLC Agreement and are fully paid (to the extent required under the Partners GP LLC Agreement) and nonassessable (except as such nonassessability may be affected by Sections 18-607 and 18-804 of the DLLCA), and are not subject to any preemptive or similar rights (and were not issued in violation of any preemptive or similar rights).

(i)             As of the date hereof, Partners GP owns all of the Partners General Partner Interest and Incentive Distribution Rights, and such Partners General Partner Interest and Incentive Distribution Rights were duly authorized and validly issued in accordance with the Partners Partnership Agreement.

(ii)            In the case of Partners, as of the date hereof, there are 44,760,692 Partners Common Units – Class A issued and outstanding, and all of such Partners Common Units – Class A and the limited partner interests represented thereby were duly authorized and validly issued in accordance with the Partners Partnership Agreement and are fully paid (to the extent required under the Partners Partnership Agreement) and nonassessable (except as such nonassessability may be affected by Sections 17-303, 17-607 and 17-804 of the DRULPA).  The New Partners Units will be duly authorized and validly issued in accordance with the Partners Partnership Agreement and the Partners Amended and Restated Partnership Agreement, as applicable, and will be fully paid (to the extent required under the Partners Partnership Agreement and the Partners Amended and Restated Partnership Agreement, as applicable) and nonassessable (except as such nonassessability may be affected by Sections 17-303, 17-607 and 17-804 of the DRULPA).

 
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(iii)           As of the date hereof, other than, (A) in the case of Partners GP, the Partners GP Series A Units and the Partners GP Series B Units and, (B) in the case of Partners, the Partners’ Common Units – Class A and phantom units issuable under the Partners LTIP, there are no interests of a party’s equity securities authorized and reserved for issuance, such party does not have any Rights issued or outstanding with respect to its equity securities, and such party does not have any commitment to authorize, issue or sell any such equity securities or Rights, except pursuant to this Agreement.

(iv)           In the case of Partners, there are no Partners Common Units – Class A that are issuable upon exercise of any employee or director options to purchase the Partners Common Units – Class A as of the date hereof.

(c)             Subsidiaries .

(i)             (A) Such party owns, directly or indirectly, all of the equity interests of each of its Subsidiaries except as set forth in Schedule 4.1(c) of such party’s Disclosure Schedule, (B) no equity interests of any of its Subsidiaries are or may become required to be issued by reason of any Rights, (C) there are no contracts, commitments, understandings or arrangements by which any of such Subsidiaries is or may be bound to sell or otherwise transfer any equity interests of any such Subsidiaries, (D) there are no contracts, commitments, understandings, or arrangements relating to its rights to vote or to dispose of such equity interests, and (E) all of the equity interests of each such Subsidiary held by it or its Subsidiaries are fully paid and nonassessable and are owned by it or its Subsidiaries free and clear of any Liens.

(ii)            In the case of the representations and warranties of Partners GP, other than (A) ownership of the Partners General Partner Interest and the Incentive Distribution Rights, (B) 0.01% of the partnership interest in the OLP and (C) a non-economic general partner interest in those Subsidiaries of Partners specified on Schedule 4.1(c) of such party’s Disclosure Schedule, Partners GP does not own beneficially, directly or indirectly, any equity securities or similar interests of any person, or any interest in a partnership or joint venture of any kind.

(iii)           Each of such party’s Subsidiaries has been duly organized and is validly existing in good standing under the Laws of the jurisdiction of its organization and (A) is duly qualified to do business and in good standing in the jurisdictions where its ownership or leasing of property or the conduct of its business requires it to be so qualified and (B) has in effect all federal, state, local, and foreign governmental authorizations and permits necessary for it to own or lease its properties and assets and to carry on its business as it is now conducted.

(d)             Partnership or Limited Liability Company Power .  Such party and each of its Subsidiaries has the partnership or limited liability company power and authority to carry on its business as it is now being conducted and to own or lease, as applicable, all its properties and assets; and it has the partnership or limited liability company power and authority to execute, deliver and perform its obligations under this Agreement and to consummate the transactions contemplated hereby.

 
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(e)             Authority .  This Agreement and the transactions contemplated hereby have been authorized by all necessary (partnership or limited liability company, as applicable) action, and this Agreement has been duly executed and delivered and is a legal, valid and binding agreement of it, enforceable against it in accordance with its terms (except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and similar Laws of general applicability relating to or affecting creditors’ rights or by general equity principles).

(f)             No Defaults .  Subject to the required filings under federal and state securities laws and the NYSE, the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby do not and will not (i) constitute a breach or violation of, or result in a default (or an event that, with notice or lapse of time or both, would become a default) under, or result in the termination or in a right of termination or cancellation of, or accelerate the performance required by, any note, bond, mortgage, indenture, deed of trust, license, franchise, lease, contract, agreement, joint venture or other instrument or obligation to which it or any of its Subsidiaries is a party or by which it or any of its Subsidiaries or properties is subject or bound, (ii) constitute a breach or violation of, or a default under, in the case of Partners GP, the Partners GP LLC Agreement or Partners GP Certificate of Formation, and in the case of Partners, the Partners Partnership Agreement or Partners Certificate of Limited Partnership, (iii) contravene or conflict with or constitute a violation of any provision of any Law binding upon or applicable to it or any of its Subsidiaries, (iv) result in the creation of any Lien on any of its assets or its Subsidiaries’ assets other than in connection with any indebtedness obtained in connection with the transactions contemplated by this Agreement, or (v) cause the transactions contemplated by this Agreement to be subject to Takeover Laws.

(g)             Financial Reports and SEC Documents .  In the case of Partners, its annual report on Form 10-K for the fiscal year ended December 31, 2009, and all other reports, registration statements, definitive proxy statements or information statements filed or to be filed by it or any of its Subsidiaries subsequent to December 31, 2009 under the Securities Act, or under Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, in the form filed, or to be filed (collectively, its “ SEC Documents ”), with the SEC (i) complied or will comply in all material respects as to form with the applicable requirements under the Securities Act or the Exchange Act, as the case may be, and (ii) did not and will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements made therein, in light of the circumstances under which they were made, not misleading; and each of the balance sheets contained in or incorporated by reference into any such SEC Document (including the related notes and schedules thereto) fairly presents the financial position of the entity or entities to which it relates as of its date, and each of the statements of income and changes in partners’ equity and cash flows or equivalent statements in the case of Partners in such SEC Documents (including any related notes and schedules thereto) fairly presents the results of operations, changes in partners’ equity and changes in cash flows, as the case may be, of the entity or entities to which it relates for the periods to which it relates, in each case in accordance with generally accepted accounting principles consistently applied during the periods involved, except in each case as may be noted therein, subject to normal year-end audit adjustments in the case of unaudited statements.  In the case of Partners GP, the audited balance sheet of Partners GP  as December 31, 2009 and 2008 (including the related notes thereto), and the unaudited statements of income and members’ equity for the three-year period ended December 31, 2009 set forth on Schedule 4.1(g) of its Disclosure Schedule, and the unaudited balance sheet of Partners GP as of September 30, 2010 and the related unaudited statements of income and members’ equity for the nine-month period ended September 30, 2010 set forth on Schedule 4.1(g) of its Disclosure Schedule, fairly presents the financial position of Partners GP as of each date, in each case in accordance with generally accepted accounting principles consistently applied during the periods involved, except in each case as may be noted therein, subject to normal year-end adjustments in the case of the unaudited statements as of September 30, 2010 and for the nine months then ended.  Except as and to the extent set forth on its balance sheet as of December 31, 2009, as of such date, neither it nor any of its Subsidiaries had any liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise) that would be required to be reflected on, or reserved against in, a balance sheet or in the notes thereto prepared in accordance with generally accepted accounting principles consistently applied.

 
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(h)             No Brokers .  No action has been taken by it that would give rise to any valid claim against any party hereto for a brokerage commission, finder’s fee or other like payment with respect to the transactions contemplated by this Agreement, excluding, in the case of Partners GP, fees to be paid to Robert W. Baird & Co. and, in the case of Partners, fees to be paid to Raymond James & Associates, Inc., in every case pursuant to letter agreements, the fee provisions of which have been heretofore disclosed to the other party.

(i)              Tax Matters .

(i)             All material returns, declarations, reports, estimates, information returns and statements required to be filed under federal, state, local or any foreign Tax Laws (“ Tax Returns ”) with respect to it or any of its Subsidiaries, have been timely filed, or requests for extensions have been timely filed and have not expired;

(ii)            all Tax Returns filed by it are complete and accurate in all material respects;

(iii)           all Taxes shown to be due on such Tax Returns and all other Taxes, if any, required to be paid by it or its Subsidiaries for all periods ending through the date hereof have been paid or adequate reserves have in accordance with generally accepted accounting principles been established for the payment of such Taxes; and

(iv)           no material (a) audit or examination or (b) refund litigation with respect to any Tax Return of such party is pending.  As of the date hereof, neither it nor any of its Subsidiaries (x) has granted any requests, agreements, consents or waivers to extend the statutory period of limitations applicable to the assessment of any Taxes with respect to any Tax Returns nor (y) is a party to any Tax sharing or Tax indemnity agreement.

(j)              Regulatory Approvals .  No approval of any governmental agency is necessary to consummate the transactions contemplated by this Agreement (other than filings under the Securities Act).

(k)             Amended and Restated Partnership Agreement of Partners .  Partners GP   has executed the Partners Amended and Restated Partnership Agreement, which shall be effective at the Effective Time.

 
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(l)              Amended and Restated LLC Agreement of Partners GP .  Each of Partners, Partners GP and the requisite members (or their attorney in fact) have executed the Partners GP Amended and Restated LLC Agreement, which shall be effective at the Effective Time .

(m)            New Partners Common Units – Class A Listed .  The New Partners Common Units – Class A and any Partners Common Units – Class A issuable upon conversion of any of the New Partners Units that are convertible into Partners Common Units – Class A, have been listed on the NYSE, subject to official notice of issuance.

(n)             The Deal Committee and Partners GP Board Recommendation .  The   Partners GP Board delegated to the Deal Committee the authority of the Partners GP Board to negotiate the terms and conditions of the Merger with respect to Partners GP, subject to final approval by the Partners GP Board.  The Deal Committee has determined that the Merger, this Agreement and the transactions contemplated hereby, including the Partners GP Amended and Restated LLC Agreement, are fair and reasonable to, and in the best interests of, Partners GP and its unitholders, and approved and declared the advisability of the Merger, this Agreement and the Partners GP Amended and Restated LLC Agreement and resolved to recommend that the Partners GP Board approve the Merger, this Agreement and the Partners GP Amended and Restated LLC Agreement.  The Partners GP Board has determined that the Merger, this Agreement and the transactions contemplated hereby, including the Partners GP Amended and Restated LLC Agreement, are fair and reasonable to, and in the best interests of, Partners GP and the its unitholders, and approved and declared the advisability of the Merger, this Agreement, and the Partners GP Amended and Restated LLC Agreement and resolved to recommend that the Quintana Entity (as defined in the Partners GP LLC Agreement) and holders of Partners GP Series A and Partners GP Series B Units   approve the Merger, this Agreement and the transactions contemplated hereby.

(o)             Partners GP Unitholder Approval .  The Quintana Entity (as defined in the Partners GP LLC Agreement) and holders of at least a majority of each of the Partners GP Series A Units and Partners GP Series B Units have approved the Merger, this Agreement and the transactions contemplated hereby.

(p)             The Conflicts Committee Recommendation and Partners GP Board Approval .  The Partners GP Board delegated to the Conflicts Committee the authority of the Partners GP Board to negotiate the terms and conditions of the Merger with respect to Partners, subject to final approval by the Partners GP Board, and to determine whether to approve the Merger by Special Approval (as defined in the Partners Partnership Agreement).  The Conflicts Committee (i) has determined that this Agreement and the transactions contemplated hereby, including the Merger, the New Partners Unit Issuance and the Partners Amended and Restated Partnership Agreement (collectively, the “ Merger Transactions ”), are fair and reasonable to Partners and the limited partners of Partners who are unaffilated with the General Partner, (ii) has approved the Agreement and the Merger Transactions by Special Approval, and (iii) has recommended to the Partners GP Board that it approve this Agreement and the Merger Transactions.  The Partners GP Board has determined that this Agreement and the transactions contemplated hereby, including the Merger Transactions, are fair and reasonable to, and in the best interests of, Partners and its unitholders and has approved this Agreement and the Merger Transactions.

 
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(q)             Operations of MergerCo.   In the case of Partners, MergerCo was formed solely for the purpose of engaging in the transactions contemplated by this Agreement and has engaged in no business other than in connection with entering into this Agreement and engaging in the transactions contemplated hereby.

(r)              Partners Fairness Opinion .  Raymond James & Associates, Inc. has delivered to the Partners Conflicts Committee its written opinion to the effect that, as of the date the Partners GP Board approved this Agreement and subject to certain assumptions, qualifications, limitations and other matters, the Merger Consideration to be paid is fair, from a financial point of view, to (i) the public, unaffiliated common unitholders of Partners and (ii) Partners.

(s)             No Partners Material Adverse Effect.   In the case of Partners, there has not occurred a Material Adverse Effect between January 1, 2010 and the date of this Agreement.

ARTICLE V
COVENANTS

Section 5.1              Indemnification; Directors’ and Officers’ Insurance .  Partners GP hereby covenants to and agrees with Partners, and Partners hereby covenants to and agrees with Partners GP, that:

(a)            Without limiting any additional rights that any director, officer, trustee, employee, agent, or fiduciary may have under any employment or indemnification agreement or under the Partners GP LLC Agreement, the Partners Partnership Agreement, or this Agreement or, if applicable, similar organizational documents or agreements of any of Partners GP’s Subsidiaries, from and after the Effective Time, Partners and the Surviving Entity, jointly and severally, shall: (i) indemnify and hold harmless each person who is at the date hereof serving as a director or officer of Partners GP or any of its Subsidiaries or as a fiduciary under or with respect to any employee benefit plan (within the meaning of Section 3(3) of ERISA) (collectively, the “ Indemnified Parties ”) to the fullest extent authorized or permitted by applicable Law, as now or hereafter in effect, in connection with any Claim and any losses, claims, damages, liabilities, costs, Indemnification Expenses, judgments, fines, penalties and amounts paid in settlement (including all interest, assessments and other charges paid or payable in connection with or in respect of any thereof) resulting therefrom; and (ii) promptly pay on behalf of or, within ten (10) days after any request for advancement, advance to each of the Indemnified Parties, any Indemnification Expenses incurred in defending, serving as a witness with respect to or otherwise participating with respect to any Claim in advance of the final disposition of such Claim, including payment on behalf of or advancement to the Indemnified Party of any Indemnification Expenses incurred by such Indemnified Party in connection with enforcing any rights with respect to such indemnification and/or advancement, in each case without the requirement of any bond or other security.  The indemnification and advancement obligations of Partners and the Surviving Entity pursuant to this Section 5.1(a) shall extend to acts or omissions occurring at or before the Effective Time and any Claim relating thereto (including with respect to any acts or omissions occurring in connection with the approval of this Agreement and the consummation of the Merger and the transactions contemplated by this Agreement, including the consideration and approval thereof and the process undertaken in connection therewith and any Claim relating thereto), and all rights to indemnification and advancement conferred hereunder shall continue as to a person who has ceased to be a director or officer of Partners GP or any of its Subsidiaries or as a fiduciary under or with respect to any employee benefit plan (within the meaning of Section 3(3) of ERISA) after the date hereof and shall inure to the benefit of such person’s heirs, executors and personal and legal representatives.  As used in this Section 5.1 : (x) the term “ Claim ” means any threatened, asserted, pending or completed action, whether instituted by any party hereto, any Governmental Authority or any other person, that any Indemnified Party in good faith believes might lead to the institution of any action or proceeding, whether civil, criminal, administrative, investigative or other, including any arbitration or other alternative dispute resolution mechanism (“ Action ”), arising out of or pertaining to matters that relate to such Indemnified Party’s duties or service as a director or officer of Partners GP, any of its Subsidiaries, or as a fiduciary under or with respect to any employee benefit plan (within the meaning of Section 3(3) of ERISA) maintained by any of the foregoing at or prior to the Effective Time; and (y) the term “ Indemnification Expenses ” means reasonable attorneys’ fees and all other reasonable costs, expenses and obligations (including experts’ fees, travel expenses, court costs, retainers, transcript fees, duplicating, printing and binding costs, as well as telecommunications, postage and courier charges) paid or incurred in connection with investigating, defending, being a witness in or participating in (including on appeal), or preparing to investigate, defend, be a witness in or participate in, any Claim for which indemnification is authorized pursuant to this Section 5.1(a) , including any Action relating to a claim for indemnification or advancement brought by an Indemnified Party.  Neither Partners nor the Surviving Entity shall settle, compromise or consent to the entry of any judgment in any actual or threatened Action in respect of which indemnification has been or could be sought by such Indemnified Party hereunder unless such settlement, compromise or judgment includes an unconditional release of such Indemnified Party from all liability arising out of such Action without admission or finding of wrongdoing, or such Indemnified Party otherwise consents thereto.

 
17

 

(b)            Without limiting the foregoing, Partners and Partners GP agree that all rights to indemnification, advancement of expenses and exculpation from liabilities for acts or omissions occurring at or prior to the Effective Time now existing in favor of the Indemnitees as provided in the Partners GP LLC Agreement (and, as applicable, the charter, bylaws, partnership agreement, limited liability company agreement, or other organizational documents of any of Partners GP’s Subsidiaries) and indemnification agreements of Partners GP or any of its Subsidiaries shall be assumed by the Surviving Entity, Partners and Partners GP in the Merger, without further action, at the Effective Time and shall survive the Merger and shall continue in full force and effect in accordance with their terms.

(c)            For a period of six (6) years from the Effective Time, the Partners Amended and Restated Partnership Agreement shall contain provisions no less favorable with respect to indemnification, advancement of expenses and limitations on liability of directors and officers than are set forth in the Partners GP LLC Agreement, which provisions shall not be amended, repealed or otherwise modified for a period of six (6) years from the Effective Time in any manner that would affect adversely the rights thereunder of individuals who, at or prior to the Effective Time, were Indemnified Parties, unless such modification shall be required by Law and then only to the minimum extent required by Law.

 
18

 

(d)            Partners shall, or shall cause the Surviving Entity to, maintain for a period of at least six (6) years following the Effective Time, the current policies of directors’ and officers’ liability insurance maintained by Partners GP and its Subsidiaries ( provided, that the Surviving Entity may substitute therefor policies of at least the same coverage and amounts containing terms and conditions which are not less advantageous to such directors and officers of Partners GP than the terms and conditions of such existing policy from carriers with the same or better rating as the carrier under the existing policy provided that such substitution shall not result in gaps or lapses of coverage with respect to matters occurring before the Effective Time) with respect to claims arising from facts or events that occurred on or before the Effective Time, including in respect of the Merger and the transactions contemplated by this Agreement; provided, that Partners shall not be required to pay annual premiums in excess of 300% of the last annual premium paid by Partners GP prior to the date hereof but in such case shall purchase as much coverage as reasonably practicable for such amount.

(e)            The provisions of Section 5.1(d) shall be deemed to have been satisfied if prepaid “tail” policies have been obtained by the Surviving Entity for purposes of this Section 5.1 from carriers with the same or better rating as the carrier of such insurances as of the date of this Agreement, which policies provide such directors and officers with the coverage described in Section 5.1(d) for an aggregate period of not less than six (6) years with respect to claims arising from facts or events that occurred on or before the Effective Time, including, in respect of the Merger and the transactions contemplated by this Agreement.

(f)            If Partners, or the Surviving Entity or any of their respective successors or assigns (i) consolidates with or merges with or into any other person and shall not be the continuing or surviving corporation, partnership or other entity of such consolidation or merger or (ii) transfers or conveys all or substantially all of its properties and assets to any person, then, and in each such case, proper provision shall be made so that the successors and assigns of Partners and the Surviving Entity assume the obligations set forth in this Section 5.1 .

(g)            Partners shall cause the Surviving Entity to perform all of the obligations of the Surviving Entity under this Section 5.1 .

(h)            This Section 5.1 shall survive the consummation of the Merger and is intended to be for the benefit of, and shall be enforceable by, the Indemnified Parties and the Indemnitees and their respective heirs and personal representatives, and shall be binding on Partners, the Surviving Entity and their respective successors and assigns.

Section 5.2              Equity Incentive Plan.   Following the Closing Date, the Partnership shall establish, subject to, if required by any national securities exchange on which any securities of the Partnership are listed or traded or by Tax or other Law, approval by the unitholders of Partners, an equity incentive plan for eligible employees of Partners and Partners GP, including the Executives (as defined in the Partners Amended and Restated Partnership Agreement), providing for the issuance of at least (i)   145,620.0000 Partners Common Units – Class A, (ii) 0 Partners Common Units – Class B, (iii) 12,741.7500 Partners Waiver Units – Class 1, (iv) 12,741.7500 Partners Waiver Units – Class 2, (v) 12,741.7500 Partners Waiver Units – Class 3, and (vi) 12,741.7500 Partners Waiver Units – Class 4 (subject to rounding for fractional units, the “ Reserved Units ”); provided, however, that if such unitholder approval is required and the Partners GP Board determines not to seek such approval, Partners shall establish a cash-settled or cash-based plan (i.e., a plan providing for the issuance of phantom units or similar plan providing for the issuance of the economic equivalent of the Reserved Units) not subject to such approval that would provide substantially equivalent economic benefits to such participants as the foregoing plan.

 
19

 

ARTICLE VI
MISCELLANEOUS

Section 6.1              Waiver; Amendment .  Subject to compliance with applicable Law, prior to the Effective Time, any provision of this Agreement may be a) waived in writing by the party benefited by the provision and approved by the Deal Committee and by the Conflicts Committee, as applicable, and executed in the same manner as this Agreement, or b) amended or modified at any time by an agreement in writing between the parties hereto approved by the Conflicts Committee and by the Deal Committee and executed in the same manner as this Agreement,   provided , that no amendment shall be made that requires any approval of any of the Partners unitholders or Partners GP unitholders without such approval.

Section 6.2              Counterparts .  This Agreement may be executed in one or more counterparts, each of which shall be deemed to constitute an original.

Section 6.3              Governing Law .  This Agreement shall be governed by, and interpreted in accordance with, the Laws of the State of Delaware, without regard to the conflict of law principles thereof (except to the extent that mandatory provisions of federal or Delaware law govern).

Section 6.4              Notices .  All notices, requests and other communications hereunder to a party shall be in writing and shall be deemed given if personally delivered, telecopied (with confirmation) or mailed by registered or certified mail (return receipt requested) to such party at its address set forth below or such other address as such party may specify by notice to the parties hereto.

If to Partners or MergerCo, to:

Genesis Energy, L.P.
919 Milam, Suite 2100
Houston, Texas 77002
Attention: Chief Executive Officer
Fax:  (713) 860-2647

With copies (which shall not constitute proper notice hereunder) to:

Genesis Energy, L.P.
919 Milam, Suite 2100
Houston, Texas 77002
Attention: Chairman of the Conflicts Committee
Fax:  (713) 860-2647

 
20

 

and

Gibson Dunn & Crutcher LLP
1050 Connecticut Avenue, N.W.
Washington, DC 20036-5306
Fax:  (202) 530-9526
 
Attn:
John F. Olson
Howard B. Adler

If to Partners GP to:

Genesis Energy, LLC
919 Milam, Suite 2100
Houston, Texas 77002
Attention: Chief Executive Officer
Fax:  (713) 860-2647

With copies (which shall not constitute proper notice hereunder) to:

Genesis Energy, L.P.
919 Milam, Suite 2100
Houston, Texas 77002
Attention: Chairman of the Deal Committee
Fax:  (713) 860-2647

and

Akin Gump Strauss Hauer & Feld LLP
1111 Louisiana Street
44 th Floor
Houston, TX 77002-5200
Fax: (713) 236-0822
 
Attn:
J. Vincent Kendrick
Patrick Hurley

Section 6.5              Entire Understanding; No Third Party Beneficiaries .  This Agreement represents the entire understanding of the parties hereto with reference to the transactions contemplated hereby and supersedes any and all other oral or written agreements heretofore made.  Except as contemplated by Section 5.1 , nothing in this Agreement, expressed or implied, is intended to confer upon any person, other than the parties hereto or their respective successors, any rights, remedies, obligations or liabilities under or by reason of this Agreement.

Section 6.6              Severability .  If any provision of this Agreement shall be held invalid or unenforceable by any court of competent jurisdiction or as a result of future legislative action, so long as the economic and legal substance of the transactions contemplated hereby are not affected in any manner materially adverse to any party, such holding or action shall be strictly construed and shall not affect the validity or effect of any other provision hereof, as long as the remaining provisions, taken together, are sufficient to carry out the overall intentions of the parties as evidenced hereby.

 
21

 

Section 6.7              Headings .  The headings contained in this Agreement are for reference purposes only and are not part of this Agreement.

Section 6.8              Jurisdiction .  The parties hereto agree that any suit, action or proceeding seeking to enforce any provision of, or based on any matter arising out of or in connection with, this Agreement or the transactions contemplated hereby shall be brought in any federal court located in the State of Delaware or the Delaware Court of Chancery, and each of the parties hereby irrevocably consents to the jurisdiction of such courts (and of the appropriate appellate courts therefrom) in any such suit, action or proceeding and irrevocably waives, to the fullest extent permitted by Law, any objection that it may now or hereafter have to the laying of the venue of any such suit, action or proceeding in any such court or that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.  Process in any such suit, action or proceeding may be served on any party anywhere in the world, whether within or without the jurisdiction of any such court.  Without limiting the foregoing, each party agrees that service of process on such party as provided in Section 6.4 shall be deemed effective service of process on such party.

Section 6.9              Waiver of Jury Trial .   EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

Section 6.10             Specific Performance .  The parties agree that irreparable damage would occur if any provision of this Agreement were not performed in accordance with the terms hereof and, accordingly, that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement or to enforce specifically the performance of the terms and provisions hereof in any federal court located in the State of Delaware or in the Delaware Court of Chancery, in addition to any other remedy to which they are entitled at law or in equity.

Section 6.11             Survival .  All representations, warranties, agreements and covenants contained in this Agreement shall not survive the Closing; provided , however , that the agreements of the parties in Sections 3.3 , 5.1 and 5.2 shall survive the Closing.

Section 6.12             No Act or Failure to Act .  With respect to any waiver or consent for which this Agreement expressly requires waiver or consent by the Conflicts Committee or the Deal Committee, no waiver or consent by or on behalf of Partners or Partners GP, as applicable, pursuant to or as contemplated by this Agreement shall have any effect unless such waiver or consent is expressly approved by such committee.  With respect to any act or failure to act for which this Agreement expressly requires action or inaction by the Conflicts Committee or the Deal Committee, as applicable, no such act or failure to act by the Partners GP Board shall constitute a breach by Partners or Partners GP of this Agreement, as the case may be, unless such act or failure to act is expressly approved by such committee.

 
22

 

Section 6.13            Termination .  Notwithstanding anything herein to the contrary, this Agreement may be terminated and the Merger may be abandoned at any time prior to the Effective Time, whether before or after unitholder approval of this Agreement, by either Partners or Partners GP upon written notice to the other, if the Effective Time shall not have occurred on or prior to 6:00 p.m. EST on the date hereof.

[Remainder of this page is intentionally left blank.]

 
23

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in counterparts by their duly authorized officers, all as of the day and year first above written.

 
GENESIS ENERGY, L.P.
         
 
By:
Genesis Energy, LLC,
   
its general partner
         
   
By:
/s/ Grant E. Sims
     
Name:
Grant E. Sims
     
Title:
Chief Executive Officer
         
 
GENESIS ACQUISITION, LLC
         
 
By:
/s/ Grant E. Sims
   
Name:
Grant E. Sims
   
Title:
Chief Executive Officer
         
 
GENESIS ENERGY, LLC
         
 
By:
/s/ Robert C. Sturdivant
   
Name:
Robert C. Sturdivant
   
Title:
Chairman of the Board
 
[Signature Page - Agreement and Plan of Merger (1 of 1)]

 
 

 

ANNEX A

FORM OF FIFTH AMENDED AND RESTATED PARTNERSHIP AGREEMENT OF PARTNERS
 
 
Annex A-1

 

ANNEX B

FORM OF SECOND AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT OF PARTNERS GP
 
 
Annex B-1

 

SCHEDULE A

ALLOCATION OF MERGER CONSIDERATION
 
 
Schedule A-1

 

SCHEDULE B

PARTNERS DISCLOSURE SCHEDULE
 
 
Schedule B-1

 

SCHEDULE C

PARTNERS GP DISCLOSURE SCHEDULE
 
 
Schedule C-1
 


Exhibit 5.1
 
Execution Copy

FIFTH AMENDED AND RESTATED

AGREEMENT OF LIMITED PARTNERSHIP

OF

GENESIS ENERGY, L.P.
 
 


 
 

 

FIFTH AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
GENESIS ENERGY, L.P.

TABLE OF CONTENTS

ARTICLE I DEFINITIONS
2
 
1.1
Definitions
2
 
1.2
Construction
16
       
ARTICLE II ORGANIZATION
17
 
2.1
Continuation of Existence
17
 
2.2
Name
17
 
2.3
Registered Office; Registered Agent; Principal Office; Other Offices
17
 
2.4
Purpose and Business
17
 
2.5
Powers
18
 
2.6
Power of Attorney
18
 
2.7
Term
19
 
2.8
Title to Partnership Assets
19
       
ARTICLE III RIGHTS OF LIMITED PARTNERS
20
 
3.1
Limitation of Liability
20
 
3.2
Management of Business
20
 
3.3
Outside Activities of the Limited Partners
20
 
3.4
Rights of Limited Partners
20
       
ARTICLE IV CERTIFICATES; RECORD HOLDERS; TRANSFER OF PARTNERSHIP INTERESTS; REDEMPTION OF PARTNERSHIP INTERESTS
21
 
4.1
Certificates
21
 
4.2
Mutilated, Destroyed, Lost or Stolen Certificates
22
 
4.3
Record Holders
23
 
4.4
Transfer Generally
23
 
4.5
Registration and Transfer of Limited Partner Interests
23
 
4.6
Transfer of a General Partner’s General Partner Interest
24
 
4.7
Restrictions on Transfers
25
 
4.8
Citizenship Certificates; Non-citizen Assignees
25
 
4.9
Redemption of Partnership Interests of Non-citizen Assignees
26
       
ARTICLE V CAPITAL CONTRIBUTIONS AND ISSUANCE OF PARTNERSHIP INTERESTS
28
 
5.1
Transformation of the General Partner Interest
28
 
5.2
Cancellation of Incentive Distribution Rights
28
 
5.3
Previous Capital Contributions
28
 
5.4
Interest and Withdrawal
28
 
5.5
Capital Accounts
28
 
5.6
Issuances of Additional Partnership Securities
31
 
5.7
No Preemptive Right
32
 
5.8
Splits and Combinations
32

 
i

 
 
 
5.9
Fully Paid and Non-Assessable Nature of Limited Partner Interests
33
 
5.10
Establishment of Waiver Units
33
 
5.11
Establishment of Common Units – Class B
39
       
ARTICLE VI ALLOCATIONS AND DISTRIBUTIONS
42
 
6.1
Allocations for Capital Account Purposes
42
 
6.2
Allocations for Tax Purposes
45
 
6.3
Requirement of Distributions; Distributions to Record Holders
47
       
ARTICLE VII MANAGEMENT AND OPERATION OF BUSINESS
48
 
7.1
Management
48
 
7.2
Certificate of Limited Partnership
50
 
7.3
Restrictions on General Partner’s Authority
50
 
7.4
Reimbursement of the General Partner
51
 
7.5
Outside Activities
52
 
7.6
Loans from the General Partner; Loans or Contributions from the Partnership; Contracts with Affiliates; Certain Restrictions on the General Partner
53
 
7.7
Indemnification
55
 
7.8
Liability of Indemnitees
56
 
7.9
Resolution of Conflicts of Interest
57
 
7.10
Other Matters Concerning the General Partner
58
 
7.11
Purchase or Sale of Partnership Securities
59
 
7.12
Reliance by Third Parties
59
       
ARTICLE VIII BOOKS, RECORDS, ACCOUNTING AND REPORTS
60
 
8.1
Records and Accounting
60
 
8.2
Fiscal Year
60
 
8.3
Reports
60
       
ARTICLE IX TAX MATTERS
60
 
9.1
Tax Returns and Information
60
 
9.2
Tax Elections
61
 
9.3
Tax Controversies
61
 
9.4
Withholding
61
       
ARTICLE X ADMISSION OF PARTNERS
61
 
10.1
Admission of Substituted Limited Partner
61
 
10.2
Admission of Successor General Partner
62
 
10.3
Admission of Additional Limited Partners
62
 
10.4
Amendment of Agreement and Certificate of Limited Partnership
63
       
ARTICLE XI WITHDRAWAL OR REMOVAL OF PARTNERS
63
 
11.1
Withdrawal of the General Partner
63
 
11.2
Removal of the General Partner
65
 
11.3
Removal or Other Elimination of Director Election Right
66
 
11.4
Interest of Departing Partner and Successor General Partner
66
 
11.5
Withdrawal of Limited Partners
67

 
ii

 
 
ARTICLE XII DISSOLUTION AND LIQUIDATION
67
 
12.1
Dissolution
67
 
12.2
Continuation of the Business of the Partnership after Dissolution
68
 
12.3
Liquidator
68
 
12.4
Liquidation
69
 
12.5
Cancellation of Certificate of Limited Partnership
70
 
12.6
Return of Contributions
70
 
12.7
Waiver of Partition
70
 
12.8
Capital Account Restoration
70
       
ARTICLE XIII AMENDMENT OF PARTNERSHIP AGREEMENT; MEETINGS; RECORD DATE
70
 
13.1
Amendment to be Adopted Solely by the General Partner
70
 
13.2
Amendment Procedures
71
 
13.3
Amendment Requirements
72
 
13.4
Special Meetings
73
 
13.5
Notice of a Meeting
75
 
13.6
Record Date
75
 
13.7
Adjournment
76
 
13.8
Waiver of Notice; Approval of Meeting; Approval of Minutes
76
 
13.9
Quorum
76
 
13.10
Conduct of a Meeting
77
 
13.11
Action Without a Meeting
77
 
13.12
Voting and Other Rights
78
       
ARTICLE XIV MERGER
78
 
14.1
Authority
78
 
14.2
Procedure for Merger or Consolidation
78
 
14.3
Approval by Limited Partners of Merger or Consolidation
79
 
14.4
Certificate of Merger
80
 
14.5
Effect of Merger
80
       
ARTICLE XV RIGHT TO ACQUIRE LIMITED PARTNER INTERESTS
81
 
15.1
Right to Acquire Limited Partner Interests
81
       
ARTICLE XVI GENERAL PROVISIONS
83
 
16.1
Addresses and Notices
83
 
16.2
Further Action
83
 
16.3
Binding Effect
83
 
16.4
Integration
83
 
16.5
Creditors
83
 
16.6
Waiver
83
 
16.7
Counterparts
84
 
16.8
Applicable Law
84
 
16.9
Invalidity of Provisions
84
 
16.10
Consent of Partners
84

 
iii

 

EXHIBITS

Exhibit A            Conversion Notice

 
iv

 

FIFTH AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
GENESIS ENERGY, L.P.

THIS FIFTH AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP of Genesis Energy, L.P., dated as of December  28, 2010 and effective as of the Effective Time (as defined herein), is entered into by and among Genesis Energy, LLC, a Delaware limited liability company, as the General Partner (as defined herein), together with any other Persons (as defined herein) who are or who become Partners (as defined herein) in the Partnership (as defined herein) or parties hereto as provided herein. In consideration of the covenants, conditions and agreements contained herein, the parties hereto hereby agree as follows:

WHEREAS , Genesis Energy, LLC (formerly known as Genesis Energy, Inc.), the sole general partner of the Partnership, and certain other parties organized the Partnership as a Delaware limited partnership pursuant to an Amended and Restated Agreement of Limited Partnership dated as of December 3, 1996 (the “ First Amended Agreement ”);

WHEREAS , on December 7, 2000, the General Partner and certain other parties amended and restated the First Amended Agreement to enter into the Second Amended and Restated Agreement of Limited Partnership of Genesis Energy, L.P. (the “ Second Amended Agreement ”);

WHEREAS , on July 31, 2002, the General Partner amended and restated the Second Amended Agreement to enter into the Third Amended and Restated Agreement of Limited Partnership of Genesis Energy, L.P. (the “ Third Amended Agreement ”);

WHEREAS , on June 9, 2005, the General Partner amended and restated the Third Amended Agreement to enter into the Fourth Amended and Restated Agreement of Limited Partnership of Genesis Energy, L.P., which was subsequently amended on December 18, 2007 and March 1, 2010 (as amended, the “ Fourth Amended Agreement ”); and

WHEREAS , the General Partner hereby, pursuant to the authority contained in Sections 7.1 (Management) and 13.1 (Amendment to be Adopted Solely by the General Partner) of the Fourth Amended Agreement, amends and restates the Fourth Amended Agreement as provided herein to, among other things, reflect the consummation of the transactions contemplated by the General Partner Merger Agreement (as defined herein), including to reflect the transformation of the 2.0% economic general partner interest in the Partnership to a non-economic general partner interest in the Partnership and the cancellation of Incentive Distribution Rights, and to set forth the rights, preferences and privileges of the Common Units – Class B and the Waiver Units (each, as defined herein).

NOW, THEREFORE , in consideration of the premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby amend and restate the Fourth Amended Agreement in its entirety:

 
1

 

ARTICLE I
DEFINITIONS

1.1            Definitions .  The following definitions shall be for all purposes, unless otherwise clearly indicated to the contrary, applied to the terms used in this Agreement.

Additional Limited Partner ” means a Person admitted to the Partnership as a Limited Partner pursuant to Section 10.3 and who is shown as such on the books and records of the Partnership.

Adjusted Capital Account ” means the Capital Account maintained for each Partner as of the end of each fiscal year of the Partnership, (a) increased by any amounts that such Partner is obligated to restore under the standards set by Treasury Regulation Section 1.704-1(b)(2)(ii)(c) (or is deemed obligated to restore under Treasury Regulation Sections 1.704-2(g) and 1.704-2(i)(5)) and (b) decreased by (i) the amount of all losses and deductions that, as of the end of such fiscal year, are reasonably expected to be allocated to such Partner in subsequent years under Sections 704(e)(2) and 706(d) of the Code and Treasury Regulation Section 1.751-1(b)(2)(ii), and (ii) the amount of all distributions that, as of the end of such fiscal year, are reasonably expected to be made to such Partner in subsequent years in accordance with the terms of this Agreement or otherwise to the extent they exceed offsetting increases to such Partner’s Capital Account that are reasonably expected to occur during (or prior to) the year in which such distributions are reasonably expected to be made (other than increases as a result of a minimum gain chargeback pursuant to Section 6.1(d)(i) or 6.1(d)(ii) ). The foregoing definition of Adjusted Capital Account is intended to comply with the provisions of Treasury Regulation Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith. The “Adjusted Capital Account” of a Partner in respect of a Common Unit, a Waiver Unit or any other Partnership Interest shall be the amount that such Adjusted Capital Account would be if such Common Unit, Waiver Unit or other Partnership Interest were the only interest in the Partnership held by such Partner from and after the date on which such Common Unit, Waiver Unit or other Partnership Interest was first issued.

Adjusted Property ” means any property the Carrying Value of which has been adjusted pursuant to Section 5.5(d)(i) or 5.5(d)(ii) .

Affiliate ” means, with respect to any Person, any other Person that (i) directly or indirectly through one or more intermediaries controls, is controlled by or is under common control with, the Person in question or (ii) owns, beneficially, directly or indirectly, 20% or more of the outstanding capital stock, shares or other equity interests of the Person in question. As used herein, the term “control” means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract or otherwise.

Agreed Allocation ” means any allocation, other than a Required Allocation, of an item of income, gain, loss or deduction pursuant to the provisions of Section 6.1 , including a Curative Allocation (if appropriate to the context in which the term “Agreed Allocation” is used).

 
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Agreed Value ” of any Contributed Property means the fair market value of such property or other consideration at the time of contribution as determined by the General Partner using such reasonable method of valuation as it may adopt. The General Partner shall, in its discretion, use such method as it deems reasonable and appropriate to allocate the aggregate Agreed Value of Contributed Properties contributed to the Partnership in a single or integrated transaction among each separate property on a basis proportional to the fair market value of each Contributed Property.

Agreement ” means this Fifth Amended and Restated Agreement of Limited Partnership of Genesis Energy, L.P., as it may be amended, supplemented or restated from time to time.

Assignee ” means a Non-citizen Assignee or a Person to whom one or more Limited Partner Interests have been transferred in a manner permitted under this Agreement and who has executed and delivered a Transfer Application as required by this Agreement, but who has not been admitted as a Substituted Limited Partner.

Associate ” means, when used to indicate a relationship with any Person, (a) any corporation, organization or other entity of which such Person is a director, officer, manager or partner, or serves in a similar capacity, or is directly or indirectly the owner of 20% or more of the beneficial interests in such entity or of any class of voting stock or other voting interest therein; (b) any trust or other estate in which such Person has at least a 20% beneficial interest or as to which such Person serves as trustee or in a similar fiduciary capacity; and (c) any relative or spouse of such Person, or any relative of such spouse.

Available Cash ” means, with respect to any Quarter ending prior to the Liquidation Date,

(a) the sum of (i) all cash and cash equivalents of the Partnership on hand at the end of such Quarter and (ii) all additional cash and cash equivalents of the Partnership on hand on the date of determination of Available Cash with respect to such Quarter resulting from borrowings for working capital purposes, less

(b) the amount of any cash reserves that is necessary or appropriate in the reasonable discretion of the General Partner to (i) provide for the proper conduct of the business of the Partnership Group (including reserves for future capital expenditures and for anticipated future credit needs of the business of the Partnership Group) subsequent to such Quarter, (ii) comply with applicable law or any loan agreement, security agreement, mortgage, debt instrument or other agreement or obligation to which any Group Member is a party or by which it is bound or its assets are subject, or (iii) provide funds for distributions under Section 6.3 in respect of any one or more of the next four Quarters; provided , however , that disbursements made by any Group Member or cash reserves established, increased or reduced after the end of such Quarter but on or before the date of determination of Available Cash with respect to such Quarter shall be deemed to have been made, established, increased or reduced, for purposes of determining Available Cash, within such Quarter if the General Partner so determines.

Notwithstanding the foregoing, “Available Cash” with respect to the Quarter in which the Liquidation Date occurs and any subsequent Quarter shall equal zero.

 
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Available Cash Before Reserves ” shall mean the amount determined with respect to the relevant Quarter in accordance with the methodology used to determine the Partnership’s “Available Cash Before Reserves” as set forth in the Partnership’s most recent public filing with the Commission under the Securities Exchange Act of 1934, as amended, as of the relevant determination date, in which such measure has been included; provided , however , that in no event shall Available Cash Before Reserves include proceeds from the issuance of debt or equity or gains or losses from asset sales (other than asset sales in the ordinary course of business) in determining Available Cash Before Reserves for a Quarter.

Board of Directors ” shall mean the Board of Directors of the General Partner.

Book-Tax Disparity ” means, with respect to any item of Contributed Property or Adjusted Property, as of the date of any determination, the difference between the Carrying Value of such Contributed Property or Adjusted Property and the adjusted basis thereof for federal income tax purposes as of such date. A Partner’s share of the Partnership’s Book-Tax Disparities in all of its Contributed Property and Adjusted Property will be reflected by the difference between such Partner’s Capital Account balance as maintained pursuant to Section 5.5 and the hypothetical balance of such Partner’s Capital Account computed as if it had been maintained strictly in accordance with federal income tax accounting principles.

Business Day ” means Monday through Friday of each week, except that a legal holiday recognized as such by the government of the United States of America or the states of New York or Texas shall not be regarded as a Business Day.

Capital Account ” means the capital account maintained for a Partner pursuant to Section 5.5 . The “Capital Account” of a Partner in respect of a Common Unit, a Waiver Unit or any Partnership Interest shall be the amount that such Capital Account would be if such Common Unit, Waiver Unit or other Partnership Interest were the only interest in the Partnership held by such Partner from and after the date on which such Common Unit, Waiver Unit or other Partnership Interest was first issued.

Capital Contribution ” means any cash, cash equivalents or the Net Agreed Value of Contributed Property that a Partner contributes to the Partnership.

Carrying Value ” means (a) with respect to a Contributed Property, the Agreed Value of such property reduced (but not below zero) by all depreciation, amortization and cost recovery deductions charged to the Partners’ and Assignees’ Capital Accounts in respect of such Contributed Property, and (b) with respect to any other Partnership property, the adjusted basis of such property for federal income tax purposes, all as of the time of determination. The Carrying Value of any property shall be adjusted from time to time in accordance with Sections 5.5(d)(i) and 5.5(d)(ii) and to reflect changes, additions or other adjustments to the Carrying Value for dispositions and acquisitions of Partnership properties, as deemed appropriate by the General Partner.

Cause ” means a court of competent jurisdiction has entered a final, non-appealable judgment finding the General Partner liable for actual fraud, gross negligence or willful or wanton misconduct in its capacity as general partner of the Partnership.

 
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Certificate ” means a certificate, (i) issued in global form in accordance with the rules of the Depositary or (ii) in such other form as may be adopted by the General Partner in its discretion, issued by the Partnership evidencing ownership of one or more Common Units or Waiver Units or a certificate, in such form as may be adopted by the General Partner in its discretion, issued by the Partnership evidencing ownership of one or more other Partnership Securities.

Certificate of Limited Partnership ” means the Amended and Restated Certificate of Limited Partnership of the Partnership filed with the Secretary of State of the State of Delaware as referenced in Section 7.2 , as such Certificate of Limited Partnership may be amended, supplemented or restated from time to time.

Change of Control ” means any (i) sale, lease, exchange or other transfer of all or substantially all of the assets of the Partnership and its Subsidiaries, taken as a whole, to any other Person or (ii) merger, conversion or consolidation of the Partnership with or into another Person unless, in the case of (i) or (ii), more than 50% of the outstanding securities of each class of such Person or of the resulting or surviving Person, as the case may be, are owned (directly or indirectly) by Persons that constituted Unitholders immediately prior to such sale, lease, exchange, transfer, merger, conversion or consolidation, as the case may be, on a substantially pro rata basis.

Citizenship Certification ” means a properly completed certificate in such form as may be specified by the General Partner by which an Assignee or a Limited Partner certifies that he (and if he is a nominee holding for the account of another Person, that to the best of his knowledge such other Person) is an Eligible Citizen.

Closing Price ” has the meaning assigned to such term in Section 15.1(a) .

Code ” means the Internal Revenue Code of 1986, as amended and in effect from time to time. Any reference herein to a specific section or sections of the Code shall be deemed to include a reference to any corresponding provision of future law.

Combined Interest ” has the meaning assigned to such term in Section 11.4(a) .

Commission ” means the United States Securities and Exchange Commission.

Common Unit ” means a Partnership Security representing a fractional part of the Partnership Interests of all Limited Partners and Assignees and having the rights and obligations specified with respect to a Common Unit in this Agreement consisting of Common Units – Class A and Common Units – Class B but not including any Waiver Units.  The Common Units (as defined in the Fourth Amended Agreement) are hereby re-named the “Common Units – Class A”.

Common Unit Automatic Conversion ” has the meaning assigned to such term in Section 5.11(d) .

 
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Common Unit – Class A ” means a Partnership Security representing a fractional part of the Partnership Interests of all Limited Partners and Assignees and having the rights and obligations specified with respect to Common Units – Class A in this Agreement.

Common Unit – Class B ” means a Partnership Security representing a fractional part of the Partnership Interests of all Limited Partners and Assignees and having the rights and obligations specified with respect to Common Units – Class B in this Agreement.

Common Unit Conversion Date ” has the meaning assigned to it in Section 5.11(e) .

Common Unit Conversion Notice ” has the meaning assigned to such term in Section 5.11(d) .

Common Unit Conversion Notice Date ” has the meaning assigned to such term in Section 5.11(d) .

Conflicts Committee ” means a committee of the Board of Directors of the General Partner composed entirely of two or more directors who are neither officers nor employees of the General Partner or officers, directors or employees of any Affiliate of the General Partner.

Contributed Property ” means each property or other asset, in such form as may be permitted by the Delaware Act, but excluding cash, contributed to the Partnership. Once the Carrying Value of a Contributed Property is adjusted pursuant to Section 5.5(d) , such property shall no longer constitute a Contributed Property, but shall be deemed an Adjusted Property.

Conversion Ratio ” has the meaning assigned to it in Section 5.10(b)(v) .

Conversion Right Date ” means the date on which the applicable holder of a class of Waiver Units shall have the right, at the option of such holder, to convert from time to time its Waiver Units into Common Units – Class A.

Conveyance Agreement ” means that certain Purchase & Sale and Contribution & Conveyance Agreement, dated as of November 26, 1996, among the Partnership, Genesis OLP, Genesis Energy, L.L.C., Howell and a Subsidiary of Salomon, together with the additional conveyance documents and instruments contemplated or referenced thereunder.

Coverage Ratio ” means, with respect to the relevant Quarter, the quotient derived by dividing Available Cash Before Reserves for such Quarter by the aggregate sum of the distributions paid in respect of the Common Units attributable to such Quarter.  In addition to and without limitation of the foregoing, for purposes of this definition, “Coverage Ratio” shall be calculated after giving effect on a pro forma basis to the conversion of the applicable class of Waiver Units with respect to which a determination is to be made regarding the eligibility of such class of Waiver Units for conversion pursuant to Section 5.10(b)(v) .

Curative Allocation ” means any allocation of an item of income, gain, deduction, loss or credit pursuant to the provisions of Section 6.1(d)(x) .

Current Market Price ” has the meaning assigned to such term in Section 15.1(a) .

 
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Delaware Act ” means the Delaware Revised Uniform Limited Partnership Act, 6 Del C. Section 17-101, et seq., as amended, supplemented or restated from time to time, and any successor to such statute.

Denbury ” has the meaning given to it in Section 11.2 .

Departing Partner ” means a former General Partner from and after the effective date of any withdrawal or removal of such former General Partner pursuant to Section 11.1 or 11.2 .

Depositary ” means, with respect to any Units issued in global form, The Depository Trust Company and its successors and permitted assigns.

Directors ” shall mean the members of the Board of Directors.

Disability ” means (i) Executive has been absent from his duties with the General Partner on a full-time basis for 180 out of any 220 consecutive calendar days as a result of incapacity due to mental or physical illness or injury which is determined to be total and permanent by a physician selected by the General Partner or its insurers and reasonably acceptable to the Executive or his legal representatives, or (ii) Executive is determined to be totally disabled by the Social Security Administration.

DWAC ” has the meaning assigned to such term in Section 5.10(b)(v) .

Economic Risk of Loss ” has the meaning set forth in Treasury Regulation Section 1.752-2(a).

Effective Time ” has the meaning set forth in the General Partner Merger Agreement.

Eligible Citizen ” means a Person qualified to own interests in real property in jurisdictions in which any Group Member does business or proposes to do business from time to time, and whose status as a Limited Partner or Assignee does not or would not subject such Group Member to a significant risk of cancellation or forfeiture of any of its properties or any interest therein.

Event of Withdrawal ” has the meaning assigned to such term in Section 11.1(a) .

Executive ” means (i) each holder of a Partners GP Series B Unit (as defined in the General Partner Merger Agreement) immediately prior to the Effective Time and (ii) any Person that receives Units pursuant to the New Equity Incentive Plan.

Executive Cause ” means any of the following:  (i) Executive’s commission of willful fraud against, or willful theft of any assets or property of, the General Partner, the Partnership or their respective Subsidiaries, suppliers or customers; (ii) Executive’s conviction (or plea of nolo contendere) for any felony or any crime which involves moral turpitude; (iii) Executive’s material violation of the non-disclosure or confidentiality provisions of any employment or similar agreement with the Partnership or the General Partner; (iv) Executive’s substantial non-performance of his duties and obligations, whether pursuant to any employment or similar agreement with the Partnership or the General Partner or otherwise (other than due to death or disability); (v) Executive’s gross negligence; (vi) Executive’s willful misconduct in performing his duties; (vii) Executive willfully engaging in conduct that is demonstrably and materially injurious, monetarily or otherwise, to the General Partner, the Partnership, or their respective Subsidiaries; (viii) Executive’s willful violation of material written rules, regulations or policies of the General Partner or the Partnership; or (ix) failure to follow reasonable written instructions or directions from a majority of the General Partner’s Audit Committee to Executive that Executive’s failure to follow such instructions or directions could reasonably be expected to be materially injurious, monetarily or otherwise, to the General Partner or the Partnership, or their respective Subsidiaries.

 
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First Amended Agreement ” has the meaning assigned to such term in the recitals to this Agreement.

First Amended OLP Agreement ” has the meaning assigned to such term in Section 1.1 of the Fourth Amended Agreement.

Fourth Amended Agreement ” has the meaning assigned to such term in the recitals to this Agreement.

Fourth Amended OLP Agreement ” means the Fourth Amended and Restated Agreement of Limited Partnership of Genesis Crude Oil, L.P., dated as of June 9, 2005, as it may be amended, supplemented or restated from time to time.

General Partner ” means Genesis Energy, LLC and its successors and permitted assigns as general partner of the Partnership.

General Partner Agreement ” shall mean the Second Amended and Restated Limited Liability Company Agreement of the General Partner, dated as of the date hereof, as amended or amended and restated from time to time.

General Partner Interest ” means the non-economic, management interest of the General Partner in the Partnership (in its capacity as a general partner without reference to any Limited Partner Interest held by it).  The General Partner Interest does not have any rights to ownership, profit or any rights to receive distributions from operations or the liquidation or winding up of the Partnership.

General Partner Merger Agreement ” means the Merger Agreement, dated as of the date hereof, by and among the Partnership, Genesis Acquisition, LLC, a Delaware limited liability company, and the General Partner.

Genesis OLP ” means Genesis Crude Oil, L.P., a Delaware limited partnership, and its successors.

Group ” means a particular Person and its Affiliates or Associates, together with any other Person and the other Person’s Affiliates and Associates, if both Persons (directly or indirectly through any of their Affiliates or Associates) beneficially own Partnership Securities, and such Persons (directly or indirectly through any of their Affiliates or Associates) have any agreement, arrangement or understanding for the purpose of acquiring, holding, voting (except voting pursuant to a revocable proxy or consent given to any such Person in response to a proxy or consent solicitation made to 10 or more Persons) or disposing of any Partnership Securities. For purposes of the definition of “Outstanding,” a Group will be considered the beneficial owner of any Partnership Securities directly or indirectly owned by any member of the Group.

 
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Group Member ” means a member of the Partnership Group.

Howell ” means Howell Corporation and its Subsidiaries.

Incentive Distribution Right ” has the meaning assigned to such term in Section 1.1 of the Fourth Amended Agreement.

Indemnitee ” means (a) the General Partner, any Departing Partner and any Person who is or was an Affiliate of the General Partner or any Departing Partner, (b) any Person who is or was a director, officer, employee, agent or trustee of a Group Member, (c) any Person who is or was a member, officer, director, employee, agent or trustee of the General Partner or any Departing Partner or any Affiliate of the General Partner or any Departing Partner, or any Affiliate of any such Person, and (d) any Person who is or was serving at the request of the General Partner or any Departing Partner or any such Affiliate as a director, officer, employee, member, partner, agent, fiduciary or trustee of another Person; provided, that a Person shall not be an Indemnitee by reason of providing, on a fee-for-services basis, trustee, fiduciary or custodial services.

Initial Closing Date ” means December 3, 1996.

Initial Offering ” means the initial offering and sale of Common Units to the public on December 3, 1996, as described in the Registration Statement.

Limited Partner ” means, unless the context otherwise requires, (a) each initial Limited Partner, each Substituted Limited Partner, each Additional Limited Partner, and any Partner upon the change of its status from General Partner to Limited Partner pursuant to Section 11.4 and (b) solely for purposes of Article V , Article VI , Article VII and Article IX and Section 12.4 , each Assignee; provided , however , that when the term “Limited Partner” is used herein in the context of any vote or other approval, including without limitation Article XIII and Article XIV , such term shall not, solely for such purpose, include any holder of Waiver Units, with respect to such Waiver Units, except as may otherwise be required by any non-waivable provision of law.

Limited Partner Group ” shall have the meaning assigned to such term in Section 13.4(a) .

Limited Partner Interest ” means the ownership interest of a Limited Partner or Assignee in the Partnership, which may be evidenced by Common Units, Waiver Units or other Partnership Securities or a combination thereof or interest therein, and includes any and all benefits to which such Limited Partner or Assignee is entitled as provided in this Agreement, together with all obligations of such Limited Partner or Assignee to comply with the terms and provisions of this Agreement; provided , however , that when the term “Limited Partner Interest” is used herein in the context of any vote or other approval, including without limitation Article XIII and Article XIV , such term shall not, solely for such purpose, include any Waiver Units except as may otherwise be required by any non-waivable provision of law.

 
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Liquidation Date ” means (a) in the case of an event giving rise to the dissolution of the Partnership of the type described in clauses (a) and (b) of the first sentence of Section 12.2 , the date on which the applicable time period during which the Partners have the right to elect to reconstitute the Partnership and continue its business has expired without such an election being made, and (b) in the case of any other event giving rise to the dissolution of the Partnership, the date on which such event occurs.

Liquidator ” means one or more Persons selected by the General Partner to perform the functions described in Section 12.3 as liquidating trustee of the Partnership within the meaning of the Delaware Act.

Majority Interest ” means at least a majority in Voting Power of the Outstanding Limited Partner Interests.

Merger Agreement ” has the meaning assigned to such term in Section 14.1 .

National Securities Exchange ” means an exchange registered with the Commission under Section 6(a) of the Securities Exchange Act of 1934, as amended, supplemented or restated from time to time, and any successor to such statute.

Net Agreed Value ” means, (a) in the case of any Contributed Property, the Agreed Value of such property reduced by any liabilities either assumed by the Partnership upon such contribution or to which such property is subject when contributed, and (b) in the case of any property distributed to a Partner or Assignee by the Partnership, the Partnership’s Carrying Value of such property (as adjusted pursuant to Section 5.5(d)(ii) at the time such property is distributed, reduced by any indebtedness either assumed by such Partner or Assignee upon such distribution or to which such property is subject at the time of distribution, in either case, as determined under Section 752 of the Code.

Net Income ” means, for any taxable year, the excess, if any, of the Partnership’s items of income and gain for such taxable year over the Partnership’s items of loss and deduction for such taxable year. The items included in the calculation of Net Income shall be determined in accordance with Section 5.5(b) and shall not include any items specially allocated under Section 6.1(d) .

Net Loss ” means, for any taxable year, the excess, if any, of the Partnership’s items of loss and deduction for such taxable year over the Partnership’s items of income and gain for such taxable year. The items included in the calculation of Net Loss shall be determined in accordance with Section 5.5(b) and shall not include any items specially allocated under Section 6.1(d) .

New Equity Incentive Plan ” means the equity incentive plan that may be established by the Partnership for Executives as contemplated by the General Partner Merger Agreement.

Ninety Percent Interest ” means at least 90% in Voting Power of the Outstanding Limited Partner Interests.

 
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Non-citizen Assignee ” means a Person whom the General Partner has determined in its discretion does not constitute an Eligible Citizen and as to whose Limited Partner Interest the General Partner has become the Substituted Limited Partner, pursuant to Section 4.8 .

Non-Competition Agreement ” means the Non-Competition Agreement, dated as of December 3, 1996, among the Partnership, Genesis OLP, Salomon, Basis Petroleum, Inc. and Howell.

Nonrecourse Built-in Gain ” means with respect to any Contributed Properties or Adjusted Properties that are subject to a mortgage or pledge securing a Nonrecourse Liability, the amount of any taxable gain that would be allocated to the Partners pursuant to Sections 6.2(b)(i)(A) , 6.2(b)(ii)(A) and 6.2(b)(iii) if such properties were disposed of in a taxable transaction in full satisfaction of such liabilities and for no other consideration.

Nonrecourse Deductions ” means any and all items of loss, deduction or expenditures (including any expenditure described in Section 705(a)(2)(B) of the Code) that, in accordance with the principles of Treasury Regulation Section 1.704-2(b), are attributable to a Nonrecourse Liability.

Nonrecourse Liability ” has the meaning set forth in Treasury Regulation Section 1.752-1(a)(2).

Notice of Election to Purchase ” has the meaning assigned to such term in Section 15.1(b) hereof.

Opinion of Counsel ” means a written opinion of counsel (who may be regular counsel to the Partnership or the General Partner or any of their Affiliates) acceptable to the General Partner in its reasonable discretion.

Outstanding ” means, with respect to Partnership Securities, all Partnership Securities that are issued by the Partnership and reflected as outstanding on the Partnership’s books and records as of the date of determination; provided , however , that if at any time any Person, together with its Affiliates, Associates or any Group (other than in each instance, the General Partner or its Affiliates), beneficially owns 20% or more of any Outstanding Partnership Securities of any class then Outstanding, all Partnership Securities so owned by such Person and its Affiliates and Associates, or by such Group or any member of such Group, shall not be considered to be Outstanding in any context relating to matters pertaining to the succession, election, removal, withdrawal, replacement or substitution of the General Partner, specifically including voting upon any such matters (unless otherwise required by law), or when in connection with any such matters (i) sending notices of a meeting of Limited Partners to vote on any such matter (unless otherwise required by law), (ii) calculating required votes, (iii) determining the presence of a quorum, or (iv) for other similar purposes under this Agreement, except that such Partnership Securities shall be considered to be Outstanding for purposes of Section 11.1(b)(iv) (such Partnership Securities shall not, however, be treated as a separate class of Partnership Securities for purposes of this Agreement); provided , however , that such 20% limitation shall not apply to holders of Common Units – Class B with respect to electing or making other decisions regarding Directors pursuant to Section 13.4(b) .

 
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Partner ” means the General Partner and each Limited Partner.

Partner Nonrecourse Debt ” has the meaning set forth in Treasury Regulation Section 1.704-2(b)(4).

Partner Nonrecourse Debt Minimum Gain ” has the meaning set forth in Treasury Regulation Section 1.704-2(i)(2).

Partner Nonrecourse Deductions ” means any and all items of loss, deduction or expenditure (including any expenditure described in Section 705(a)(2)(B) of the Code) that, in accordance with the principles of Treasury Regulation Section 1.704-2(i), are attributable to a Partner Nonrecourse Debt.

Partnership ” means Genesis Energy, L.P., a Delaware limited partnership, and any successors thereto.

Partnership Group ” means the Partnership and its Subsidiaries, treated as a single consolidated entity.

Partnership Interest ” means an ownership interest in the Partnership, which shall include the General Partner Interest and Limited Partner Interests.

Partnership Minimum Gain ” means that amount determined in accordance with the principles of Treasury Regulation Section 1.704-2(d).

Partnership Security ” means any class or series of equity interest in the Partnership (but excluding any options, rights, warrants and appreciation rights relating to an equity interest in the Partnership), including Common Units and Waiver Units.

Percentage Interest ” means as of any date of determination (a) as to any Unitholder or Assignee holding Common Units, the product obtained by multiplying (i) 100%, less the percentage applicable to paragraph (b), by (ii) the quotient obtained by dividing (A) the number of Common Units held by such Unitholder or Assignee by (B) the total number of all Outstanding Common Units, and (b) as to the holders of additional Partnership Securities issued by the Partnership in accordance with Section 5.6 , the percentage established as a part of such issuance.  The Percentage Interest with respect to a General Partner Interest shall at all times be zero.

Person ” means an individual or a corporation, limited liability company, partnership, joint venture, trust, unincorporated organization, association, government agency or political subdivision thereof or other entity.

Pro Rata ” means (a) when modifying Units or any class thereof, apportioned among all designated Units in accordance with their relative Percentage Interests, (b) when modifying Partners and Assignees, apportioned among all Partners and Assignees in accordance with their relative Percentage Interests and (c) when modifying holders of Waiver Units, apportioned equally among all holders of Waiver Units in accordance with the relative number or percentage of Waiver Units held by each such holder.

 
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Proxy Statement ” means the definitive Proxy Statement filed by the Partnership with the Commission under the Securities Exchange Act of 1934, as amended, for the purpose of soliciting the votes of the holders of Common Units – Class A  with respect to the Restructuring, as it has been or as it may be amended or supplemented from time to time.

Purchase Date ” means the date determined by the General Partner as the date for purchase of all Limited Partner Interests of a certain class (other than Limited Partner Interests owned by the General Partner, the Partnership and their respective Subsidiaries) pursuant to Article XV .

Quarter ” means, unless the context requires otherwise, a calendar quarter.

Recapture Income ” means any gain recognized by the Partnership (computed without regard to any adjustment required by Section 734 or Section 743 of the Code) upon the disposition of any property or asset of the Partnership, which gain is characterized as ordinary income because it represents the recapture of deductions previously taken with respect to such property or asset.

Record Date ” means the date established by the General Partner for determining (a) the identity of the Record Holders entitled to notice of, or to vote at, any meeting of Limited Partners or entitled to vote by ballot or give approval of Partnership action in writing without a meeting or entitled to exercise rights in respect of any lawful action of Limited Partners or (b) the identity of Record Holders entitled to receive any report or distribution or participate in any offer.

Record Holder ” means the Person in whose name a Unit is registered on the books of the Transfer Agent as of the opening of business on a particular Business Day, or with respect to other Partnership Securities, the Person in whose name any such other Partnership Security is registered on the books that the General Partner has caused to be kept as of the opening of business on such Business Day.

Redeemable Interests ” means any Limited Partner Interests for which a redemption notice has been given, and has not been withdrawn, pursuant to Section 4.9 .

Registration Statement ” means the Registration Statement on Form S-1 (Registration No. 333-11545), as amended, filed by the Partnership with the Commission under the Securities Act to register the offering and sale of the Common Units – Class A in the Initial Offering.

Required Allocations ” means any allocation of an item of income, gain, loss or deduction pursuant to Sections 6.1(d)(i) , 6.1(d)(ii) , 6.1(d)(iv) , 6.1(d)(vii) or 6.1(d)(ix) .

Residual Gain ” or “ Residual Loss ” means any item of gain or loss, as the case may be, of the Partnership recognized for federal income tax purposes resulting from a sale, exchange or other disposition of a Contributed Property or Adjusted Property, to the extent such item of gain or loss is not allocated pursuant to Section 6.2(b)(i)(A) or 6.2(b)(ii)(A) , respectively, to eliminate Book-Tax Disparities.

 
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Restructuring ” means the restructuring of the Partnership and Genesis OLP as approved by the requisite vote of the partners of the Partnership and Genesis OLP on December 7, 2000, and as defined in the Fourth Amended Agreement.

Salomon ” means Salomon Smith Barney Holdings Inc, a Delaware corporation, and Salomon Brothers Holdings, Inc., a Delaware corporation.

Second Amended Agreement ” has the meaning assigned to such term in the recitals to this Agreement.

Securities Act ” means the Securities Act of 1933, as amended, supplemented or restated from time to time and any successor to such statute.

Special Approval ” means approval by a majority of the members of the Conflicts Committee.

Subsidiary ” means, with respect to any Person, (a) a corporation of which more than 50% of the voting power of shares entitled (without regard to the occurrence of any contingency) to vote in the election of directors or other governing body of such corporation is owned, directly or indirectly, at the date of determination, by such Person, by one or more Subsidiaries of such Person or a combination thereof, (b) a partnership (whether general or limited) in which such Person or a Subsidiary of such Person is, at the date of determination, a general or limited partner of such partnership, but only if more than 50% of the partnership interests of such partnership (considering all of the partnership interests of such partnership as a single class) is owned, directly or indirectly, at the date of determination, by such Person, by one or more Subsidiaries of such Person, or a combination thereof, or (c) any other Person (other than a corporation or a partnership) in which such Person, one or more Subsidiaries of such Person, or a combination thereof, directly or indirectly, at the date of determination, has (i) at least a majority ownership interest or (ii) the power to elect or direct the election of a majority of the directors or other governing body of such Person.

Substituted Limited Partner ” means a Person who is admitted as a Limited Partner to the Partnership pursuant to Section 10.1 in place of and with all the rights of a Limited Partner and who is shown as a Limited Partner on the books and records of the Partnership.

Surviving Business Entity ” has the meaning assigned to such term in Section 14.2(b) .

Third Amended Agreement ” has the meaning assigned to such term in the recitals to this Agreement.

Trading Day ” has the meaning assigned to such term in Section 15.1(a) .

Transfer ” has the meaning assigned to such term in Section 4.4(a) .

Transfer Agent ” means such bank, trust company or other Person (including the General Partner or one of its Affiliates) as shall be appointed from time to time by the Partnership to act as registrar and transfer agent for the Common Units or Waiver Units.

 
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Transfer Application ” means an application and agreement for transfer of Partnership Securities in the form set forth on the back of a Certificate or in a form substantially to the same effect in a separate instrument.

Two-Thirds Interest ” means at least 662/3% in Voting Power of the Outstanding Limited Partner Interests.

Unit ” means a Partnership Security that is designated as a “Unit” and shall include Common Units and Waiver Units but shall not include a General Partner Interest; provided , however , that when the term “Unit” is used herein in the context of any vote or other approval, including without limitation Article XIII and Article XIV , such term shall not, solely for such purpose, include any Waiver Units except as may otherwise be required by any non-waivable provision of law.

Unitholders ” mean the holders of Units.

Unitholder Rights Agreement ” means that certain Unitholder Rights Agreement among the General Partner, the Partnership and the other parties thereto, dated as of July 25, 2007,  as amended on October 15, 2007, and as further amended on the date hereof (and as it may be amended, supplemented or modified from time to time).

Unrealized Gain ” attributable to any item of Partnership property means, as of any date of determination, the excess, if any, of (a) the fair market value of such property as of such date (as determined under Section 5.5(d) ) over (b) the Carrying Value of such property as of such date (prior to any adjustment to be made pursuant to Section 5.5(d) as of such date).

Unrealized Loss ” attributable to any item of Partnership property means, as of any date of determination, the excess, if any, of (a) the Carrying Value of such property as of such date (prior to any adjustment to be made pursuant to Section 5.5(d) as of such date) over (b) the fair market value of such property as of such date (as determined under Section 5.5(d) ).

U.S. GAAP ” means United States Generally Accepted Accounting Principles consistently applied.

Voting Power ” means the right, if any, of the holder of a Partnership Security  to vote on Partnership matters.  Each Common Unit shall entitle the holder thereof to one vote, with the holders of Common Units voting together as a single class, except that only the Common Units – Class B shall be entitled to vote on the election of, and other matters respecting, Directors as provided under Section 13.4(b) . Each additional Partnership Security shall entitle the holder thereof to such vote, if any, as shall be established at the time of issuance of such Partnership Security.  Except to the extent otherwise prohibited by any non-waivable provision of law or as provided in Section 5.10(b)(iii)(B) , the Waiver Units shall not be entitled to vote on any matter (including with respect to a merger, consolidation or the sale, lease, exchange or transfer of all or substantially all of the assets of the Partnership and its Subsidiaries, taken as a whole).

Waiver Unit ” means a Waiver Unit – Class 1, a Waiver Unit – Class 2, a Waiver Unit – Class 3 and/or a Waiver Unit – Class 4.

 
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Waiver Unit Automatic Conversion Date ” has the meaning assigned to such term in Section 5.10(b)(v) .

Waiver Unit – Class 1 ” means a Partnership Security representing a fractional part of the Partnership Interests of all Limited Partners and Assignees and having the rights and obligations specified with respect to a Waiver Unit – Class 1 in this Agreement, and does not refer to a Common Unit issued upon conversion of a Waiver Unit – Class 1 pursuant to the terms hereof.

Waiver Unit – Class 2 ” means a Partnership Security representing a fractional part of the Partnership Interests of all Limited Partners and Assignees and having the rights and obligations specified with respect to a Waiver Unit – Class 2 in this Agreement, and does not refer to a Common Unit issued upon conversion of a Waiver Unit – Class 2 pursuant to the terms hereof.

Waiver Unit – Class 3 ” means a Partnership Security representing a fractional part of the Partnership Interests of all Limited Partners and Assignees and having the rights and obligations specified with respect to a Waiver Unit – Class 3 in this Agreement, and does not refer to a Common Unit issued upon conversion of a Waiver Unit – Class 3 pursuant to the terms hereof.

Waiver Unit – Class 4 ” means a Partnership Security representing a fractional part of the Partnership Interests of all Limited Partners and Assignees and having the rights and obligations specified with respect to a Waiver Unit – Class 4 in this Agreement, and does not refer to a Common Unit issued upon conversion of a Waiver Unit – Class 4 pursuant to the terms hereof.

Waiver Unit Conversion Notice ” has the meaning assigned to such term in Section 5.10(b)(v) .

Waiver Unit Conversion Notice Date ” has the meaning assigned to such term in Section 5.10(b)(v) .

Waiver Unit Surrender Date ” has the meaning assigned to such term in Section 5.10(b)(v) .

Withdrawal Opinion of Counsel ” has the meaning assigned to such term in Section 11.1(b) .

1.2            Construction .  Unless the context requires otherwise: (a) any pronoun used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns, pronouns and verbs shall include the plural and vice versa; (b) references to Articles and Sections refer to Articles and Sections of this Agreement; and (c) the term “include” or “includes” means includes, without limitation, and “including” means including, without limitation.

 
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ARTICLE II
ORGANIZATION

2.1            Continuation of Existence .  The General Partner and the Limited Partners hereby amend and restate the Fourth Amended Agreement in its entirety to continue the Partnership as a limited partnership pursuant to the provisions of the Delaware Act and to set forth the rights and obligations of the Partners and certain matters related thereto. This amendment and restatement shall become effective at the Effective Time. Except as expressly provided to the contrary in this Agreement, the rights, duties (including fiduciary duties), liabilities and obligations of the Partners and the administration, dissolution and termination of the Partnership shall be governed by the Delaware Act. All Partnership Interests shall constitute personal property of the owner thereof for all purposes and a Partner has no interest in specific Partnership property.

2.2            Name .  The name of the Partnership shall be “Genesis Energy, L.P.” The Partnership’s business may be conducted under any other name or names deemed necessary or appropriate by the General Partner in its sole discretion, including the name of the General Partner. The words “Limited Partnership,” “L.P.,” “Ltd.” or similar words or letters shall be included in the Partnership’s name where necessary for the purpose of complying with the laws of any jurisdiction that so requires. The General Partner in its discretion may change the name of the Partnership at any time and from time to time and shall notify the Limited Partners of such change in the next regular communication to the Limited Partners.

2.3            Registered Office; Registered Agent; Principal Office; Other Offices .  Unless and until changed by the General Partner, the registered office of the Partnership in the State of Delaware shall be located at 1209 Orange Street, New Castle County, Wilmington, Delaware 19801, and the registered agent for service of process on the Partnership in the State of Delaware at such registered office shall be CT Corporation System. The principal office of the Partnership shall be located at 919 Milam, Suite 2100, Houston, Texas 77002 or such other place as the General Partner may from time to time designate by notice to the Limited Partners. The Partnership may maintain offices at such other place or places within or outside the State of Delaware as the General Partner deems necessary or appropriate. The address of the General Partner shall be 919 Milam, Suite 2100, Houston, Texas 77002 or such other place as the General Partner may from time to time designate by notice to the Limited Partners.

2.4            Purpose and Business .  The purpose and nature of the business to be conducted by the Partnership shall be to (a) engage directly in, or enter into or form any corporation, partnership, joint venture, limited liability company or other arrangement to engage indirectly in, any business activity that Genesis OLP is permitted to engage in by the Fourth Amended OLP Agreement and, in connection therewith, to exercise all of the rights and powers conferred upon the Partnership pursuant to the agreements relating to such business activity, (b) engage directly in, or to enter into or form any corporation, partnership, joint venture, limited liability company or other arrangement to engage indirectly in, any business activity that is approved by the General Partner and which lawfully may be conducted by a limited partnership organized pursuant to the Delaware Act and, in connection therewith, to exercise all of the rights and powers conferred upon the Partnership pursuant to the agreements relating to such business activity, (c) do anything necessary or appropriate to the foregoing, including the making of capital contributions or loans to a Group Member, and (d) serve as a member of the General Partner and, in connection therewith, to exercise all the rights and powers held by the Partnership as a member of the General Partner, pursuant to the General Partner Agreement. The General Partner has no obligation or duty to the Partnership, the Limited Partners, or the Assignees to propose or approve, and in its discretion may decline to propose or approve, the conduct by the Partnership of any business.

 
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2.5            Powers .  The Partnership shall be empowered to do any and all acts and things necessary, appropriate, proper, advisable, incidental to or convenient for the furtherance and accomplishment of the purposes and business described in Section 2.4 and for the protection and benefit of the Partnership.

2.6            Power of Attorney .

(a)            Each Limited Partner and each Assignee hereby constitutes and appoints the General Partner and, if a Liquidator shall have been selected pursuant to Section 12.3 , the Liquidator, severally (and any successor to the Liquidator by merger, transfer, assignment, election or otherwise) and each of their authorized officers and attorneys-in-fact, as the case may be, with full power of substitution, as his true and lawful agent and attorney-in-fact, with full power and authority in his name, place and stead, to:

(i)             execute, swear to, acknowledge, deliver, file and record in the appropriate public offices (A) all certificates, documents and other instruments (including this Agreement and the Certificate of Limited Partnership and all amendments or restatements hereof or thereof) that the General Partner or the Liquidator deems necessary or appropriate to form, qualify or continue the existence or qualification of the Partnership as a limited partnership (or a partnership in which the limited partners have limited liability) in the State of Delaware and in all other jurisdictions in which the Partnership may conduct business or own property; (B) all certificates, documents and other instruments that the General Partner or the Liquidator deems necessary or appropriate to reflect, in accordance with its terms, any amendment, change, modification or restatement of this Agreement; (C) all certificates, documents and other instruments (including conveyances and a certificate of cancellation) that the General Partner or the Liquidator deems necessary or appropriate to reflect the dissolution and liquidation of the Partnership pursuant to the terms of this Agreement; (D) all certificates, documents and other instruments relating to the admission, withdrawal, removal or substitution of any Partner pursuant to, or other events described in, Article IV , Article X , Article XI or Article XII ; (E) all certificates, documents and other instruments relating to the determination of the rights, preferences and privileges of any class or series of Partnership Securities issued pursuant to Section 5.6 ; and (F) all certificates, documents and other instruments  (including agreements and a certificate of merger) relating to a merger or consolidation of the Partnership pursuant to Article XIV ; and

(ii)            execute, swear to, acknowledge, deliver, file and record all ballots, consents, approvals, waivers, certificates, documents and other instruments necessary or appropriate, in the discretion of the General Partner or the Liquidator, to (A) make, evidence, give, confirm or ratify any vote, consent, approval, agreement or other action that is made or given by the Partners hereunder or is consistent with the terms of this Agreement or is necessary or appropriate, in the discretion of the General Partner or the Liquidator or (H) effectuate the terms or intent of this Agreement; provided, that when required by Section 13.3 or any other provision of this Agreement that establishes a percentage of the Limited Partners or of the Limited Partners of any class or series required to take any action, the General Partner and the Liquidator may exercise the power of attorney made in this Section 2.6 (a)(ii) only after the necessary vote, consent or approval of the Limited Partners or of the Limited Partners of such class or series, as applicable.

 
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Nothing contained in this Section 2.6(a) shall be construed as authorizing the General Partner to amend this Agreement except in accordance with Article XIII or as may be otherwise expressly provided for in this Agreement.

(b)            The foregoing power of attorney is hereby declared to be irrevocable and a power coupled with an interest, and it shall survive and, to the maximum extent permitted by law, not be affected by the subsequent death, incompetency, disability, incapacity, dissolution, bankruptcy or termination of any Limited Partner or Assignee and the transfer of all or any portion of such Limited Partner’s or Assignee’s Partnership Interest and shall extend to such Limited Partner’s or Assignee’s heirs, successors, assigns and personal representatives. Each such Limited Partner or Assignee hereby agrees to be bound by any representation made by the General Partner or the Liquidator acting in good faith pursuant to such power of attorney; and each such Limited Partner or Assignee, to the maximum extent permitted by law, hereby waives any and all defenses that may be available to contest, negate or disaffirm the action of the General Partner or the Liquidator taken in good faith under such power of attorney. Each Limited Partner or Assignee shall execute and deliver to the General Partner or the Liquidator, within 15 days after receipt of the request therefor, such further designation, powers of attorney and other instruments as the General Partner or the Liquidator deems necessary to effectuate this Agreement and the purposes of the Partnership.

2.7            Term .  The term of the Partnership shall continue until the close of Partnership business on December 31, 2086 or until the earlier dissolution of the Partnership in accordance with the provisions of Article XII . The existence of the Partnership as a separate legal entity shall continue until the cancellation of the Certificate of Limited Partnership as provided in the Delaware Act.

2.8            Title to Partnership Assets .  Title to Partnership assets, whether real, personal or mixed and whether tangible or intangible, shall be deemed to be owned by the Partnership as an entity, and no Partner or Assignee, individually or collectively, shall have any ownership interest in such Partnership assets or any portion thereof. Title to any or all of the Partnership assets may be held in the name of the Partnership, the General Partner, one or more of its Affiliates or one or more nominees, as the General Partner may determine. The General Partner hereby declares and warrants that any Partnership assets for which record title is held in the name of the General Partner or one or more of its Affiliates or one or more nominees shall be held by the General Partner or such Affiliate or nominee for the use and benefit of the Partnership in accordance with the provisions of this Agreement; provided , however , that the General Partner shall use reasonable efforts to cause record title to such assets (other than those assets in respect of which the General Partner determines that the expense and difficulty of conveyancing makes transfer of record title to the Partnership impracticable) to be vested in the Partnership as soon as reasonably practicable; provided, further, that, prior to the withdrawal or removal of the General Partner or as soon thereafter as practicable, the General Partner shall use reasonable efforts to effect the transfer of record title to the Partnership and, prior to any such transfer, will provide for the use of such assets in a manner satisfactory to the General Partner. All Partnership assets shall be recorded as the property of the Partnership in its books and records, irrespective of the name in which record title to such Partnership assets is held.

 
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ARTICLE III
RIGHTS OF LIMITED PARTNERS

3.1            Limitation of Liability .  The Limited Partners and the Assignees shall have no liability under this Agreement except as expressly provided in this Agreement or the Delaware Act.

3.2            Management of Business .  No Limited Partner or Assignee, in its capacity as such, shall participate in the operation, management or control (within the meaning of the Delaware Act) of the Partnership’s business, transact any business in the Partnership’s name or have the power to sign documents for or otherwise bind the Partnership. Any action taken by any Affiliate of the General Partner or any officer, director, employee, member, general partner, agent or trustee of the General Partner or any of its Affiliates, or any officer, director, employee, member, general partner, agent or trustee of a Group Member, in its capacity as such, shall not be deemed to be participation in the control of the business of the Partnership by a limited partner of the Partnership (within the meaning of Section 17-303(a) of the Delaware Act) and shall not affect, impair or eliminate the limitations on the liability of the Limited Partners or Assignees under this Agreement.

3.3            Outside Activities of the Limited Partners .  Subject to the provisions of Section 7.5 , which shall continue to be applicable to the Persons referred to therein, regardless of whether such Persons shall also be Limited Partners or Assignees, any Limited Partner or Assignee shall be entitled to and may have business interests and engage in business activities in addition to those relating to the Partnership, including business interests and activities in direct competition with the Partnership Group. Neither the Partnership nor any of the other Partners or Assignees shall have any rights by virtue of this Agreement in any business ventures of any Limited Partner or Assignee.

3.4            Rights of Limited Partners .

(a)            In addition to other rights provided by this Agreement or by applicable law, and except as limited by Section 3.4(b) , each Limited Partner shall have the right, for a purpose reasonably related to such Limited Partner’s interest as a limited partner in the Partnership, upon reasonable written demand and at such Limited Partner’s own expense:

(i)             to obtain true and full information regarding the status of the business and financial condition of the Partnership;

(ii)            promptly after becoming available, to obtain a copy of the Partnership’s federal, state and local tax returns for each year;

 
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(iii)           to have furnished to him a current list of the name and last known business, residence or mailing address of each Partner;

(iv)           to have furnished to him a copy of this Agreement and the Certificate of Limited Partnership and all amendments thereto, together with a copy of the executed copies of all powers of attorney pursuant to which this Agreement, the Certificate of Limited Partnership and all amendments thereto have been executed;

(v)            to obtain true and full information regarding the amount of cash and a description and statement of the Net Agreed Value of any other Capital Contribution by each Partner and which each Partner has agreed to contribute in the future, and the date on which each became a Partner; and

(vi)           to obtain such other information regarding the affairs of the Partnership as is just and reasonable.
 
(b)            The General Partner may keep confidential from the Limited Partners and Assignees, for such period of time as the General Partner deems reasonable, (ii) any information that the General Partner reasonably believes to be in the nature of trade secrets or (iii) other information the disclosure of which the General Partner in good faith believes (A) is not in the best interests of the Partnership Group, (B) could damage the Partnership Group or (C) that any Group Member is required by law or by agreement with any third party to keep confidential (other than agreements with Affiliates of the Partnership the primary purpose of which is to circumvent the obligations set forth in this Section 3.4 ).

ARTICLE IV
CERTIFICATES; RECORD HOLDERS; TRANSFER OF
PARTNERSHIP INTERESTS; REDEMPTION OF
PARTNERSHIP INTERESTS

4.1            Certificates .  Upon the Partnership’s issuance of Units to any Person, the Partnership shall issue one or more Certificates in the name of such Person evidencing the number of such Units being so issued; provided , however , with respect to the issuance of any Waiver Units or Common Units – Class B, the Partnership shall issue Certificates in accordance with Section 5.10(b) or 5.11(c) , as applicable. In addition, the General Partner may cause the Partnership to issue Certificates evidencing ownership of one or more other classes or series of Partnership Securities. Certificates shall be executed on behalf of the Partnership by the Chairman of the Board, Chief Executive Officer, President, Chief Financial Officer or any Vice President and the Secretary or any Assistant Secretary of the General Partner. No Common Unit – Class A Certificate shall be valid for any purpose until it has been countersigned by the Transfer Agent; provided , however , that if the General Partner elects to issue Units in global form, the Unit Certificates shall be valid upon receipt of a certificate from the Transfer Agent certifying that the Units have been duly registered in accordance with the directions of the Partnership.  Notwithstanding the above provisions, Common Units – Class A may be uncertificated.

 
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4.2            Mutilated, Destroyed, Lost or Stolen Certificates .

(a)            If any mutilated Certificate is surrendered to the Transfer Agent, the appropriate officers of the General Partner on behalf of the Partnership shall execute and deliver and, in the case of a Unit Certificate, the Transfer Agent shall countersign, in exchange therefor, a new Certificate evidencing the same number and type of Partnership Securities as the Certificate so surrendered.

(b)            The appropriate officers of the General Partner on behalf of the Partnership shall execute and deliver and, in the case of a Unit Certificate, the Transfer Agent shall countersign (or, in the case of Units issued in global form, register in accordance with the rules and regulations of the Depositary), a new Certificate in place of any Certificate previously issued if the Record Holder of the Certificate:

(i)             makes proof by affidavit, in form and substance satisfactory to the Partnership, that a previously issued Certificate has been lost, destroyed or stolen;

(ii)            requests the issuance of a new Certificate before the Partnership has notice that the Certificate has been acquired by a purchaser for value in good faith and without notice of an adverse claim;

(iii)           if requested by the Partnership, delivers to the Partnership a bond, in form and substance satisfactory to the Partnership, with surety or sureties and with fixed or open penalty as the Partnership may reasonably direct, in its sole discretion, to indemnify the Partnership, the General Partner and the Transfer Agent against any claim that may be made on account of the alleged loss, destruction or theft of the Certificate; and

(iv)          satisfies any other reasonable requirements imposed by the Partnership.

If a Limited Partner or Assignee fails to notify the Partnership within a reasonable time after he has notice of the loss, destruction or theft of a Certificate, and a transfer of the Limited Partner Interests represented by the Certificate is registered before the Partnership, the General Partner or the Transfer Agent receives such notification, the Limited Partner or Assignee shall be precluded from making any claim against the Partnership, the General Partner or the Transfer Agent for such transfer or for a new Certificate.

(c)            As a condition to the issuance of any new Certificate under this Section 4.2 , the Partnership may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Transfer Agent) reasonably connected therewith.

(d)            In lieu of issuing a new Certificate pursuant to this Section 4.2 , with respect to any Common Units – Class A, the Transfer Agent may cause Common Units – Class A represented by such Certificate to be uncertificated; provided, that any Record Holder may request a Certificate at the Partnership’s expense.

 
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4.3            Record Holders .  The Partnership shall be entitled to recognize the Record Holder as the Partner or Assignee with respect to any Partnership Interest and, accordingly, shall not be bound to recognize any equitable or other claim to or interest in such Partnership Interest on the part of any other Person, regardless of whether the Partnership shall have actual or other notice thereof, except as otherwise provided by law or any applicable rule, regulation, guideline or requirement of any National Securities Exchange on which Limited Partner Interests are listed for trading. Without limiting the foregoing, when a Person (such as a broker, dealer, bank, trust company or clearing corporation or an agent of any of the foregoing) is acting as nominee, agent or in some other representative capacity for another Person in acquiring and/or holding Limited Partner Interests, as between the Partnership on the one hand, and such other Persons on the other, such representative Person (a) shall be the Partner or Assignee (as the case may be) of record and beneficially, (b) must execute and deliver a Transfer Application and (c) shall be bound by this Agreement and shall have the rights and obligations of a Partner or Assignee (as the case may be) hereunder and as, and to the extent, provided for herein.

4.4            Transfer Generally .

(a)            The term “ transfer ,” when used in this Agreement with respect to a Partnership Interest, shall be deemed to refer to a transaction (i) by which the General Partner assigns its General Partner Interest to another Person, or (ii) by which the holder of a Limited Partner Interest assigns such Limited Partner Interest to another Person who is or becomes a Limited Partner or an Assignee, and includes a sale, assignment, gift, pledge, encumbrance, hypothecation, mortgage, exchange or any other disposition by law or otherwise.

(b)            No Partnership Interest shall be transferred, in whole or in part, except in accordance with the terms and conditions set forth in this Article IV . Any transfer or purported transfer of a Partnership Interest not made in accordance with this Article IV shall be null and void.

(c)            Nothing contained in this Agreement shall be construed to prevent a disposition by any stockholder, member or other owner of the General Partner of any or all of the shares of stock, membership interests or other ownership interests in the General Partner.

4.5            Registration and Transfer of Limited Partner Interests .

(a)            The Partnership shall keep or cause to be kept on behalf of the Partnership a register in which, subject to such reasonable regulations as it may prescribe and subject to the provisions of Section 4.5(b) , the Partnership will provide for the registration and transfer of Limited Partner Interests. The Transfer Agent is hereby appointed registrar and transfer agent for the purpose of registering Units and transfers of such Units as herein provided. The Partnership shall not recognize transfers of Certificates evidencing Limited Partner Interests or transfers of uncertificated Common Units – Class A unless such transfers are affected in the manner described in this Section 4.5 . Upon surrender of a Certificate for registration of transfer of any Limited Partner Interests evidenced by a Certificate, and subject to the provisions of Section 4.5(b) , the appropriate officers of the General Partner on behalf of the Partnership shall execute and deliver and, in the case of Common Units – Class A, the Transfer Agent shall countersign (or, in the case of Units issued in global form, register in accordance with the rules and regulations of the Depositary), in the name of the holder or the designated transferee or transferees, as required pursuant to the holder’s instructions, one or more new Certificates evidencing the same aggregate number and type of Limited Partner Interests as was evidenced by the Certificate so surrendered. Upon delivery of evidence of the ownership of uncertificated Common Units – Class A and subject to Section 4.5(b) , the Transfer Agent shall deliver in the name of the holder or the designated transferee or transferees, as required pursuant to the holder’s instructions, evidence of ownership of uncertificated Common Units – Class A evidencing the same aggregate number of Common Units – Class A as was evidenced by the uncertificated Common Units so surrendered.

 
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(b)            Except as otherwise provided in Section 4.8 , the Partnership shall not recognize any transfer of Limited Partner Interests until (i) if the Limited Partner Interests being transferred are evidenced by Certificates, such Certificates are surrendered for registration of transfer or (ii) if the Limited Partnership Interests being transferred are uncertificated Common Units – Class A, evidence of the ownership of such Common Units – Class A is provided and, in either case, a Transfer Application is provided and duly executed by the transferee (or the transferee’s attorney-in-fact duly authorized in writing). No charge shall be imposed by the Partnership for such transfer; provided, that as a condition to the issuance of any new Certificate, or uncertificated issuance of Common Units – Class A, under this Section 4.5 , the Partnership may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed with respect thereto.

(c)            Limited Partner Interests may be transferred only in the manner described in this Section 4.5 . The transfer of any Limited Partner Interests and the admission of any new Limited Partner shall not constitute an amendment to this Agreement.

(d)            Until admitted as a Substituted Limited Partner pursuant to Section 10.2 , the Record Holder of a Limited Partner Interest shall be an Assignee in respect of such Limited Partner Interest. Limited Partners may include custodians, nominees or any other individual or entity in its own or any representative capacity.

(e)            A transferee of a Limited Partner Interest who has completed and delivered a Transfer Application shall be deemed to have (i) requested admission as a Substituted Limited Partner, (ii) agreed to comply with and be bound by and to have executed this Agreement, (iii) represented and warranted that such transferee has the right, power and authority and, if an individual, the capacity to enter into this Agreement, (iv) granted the powers of attorney set forth in this Agreement and (v) given the consents and approvals and made the waivers contained in this Agreement.

4.6            Transfer of a General Partner’s General Partner Interest .  Prior to December 31, 2006, the General Partner shall not transfer all or any part of its General Partner Interest to a Person unless such transfer (a) has been approved by the prior written consent or vote of the holders of a Majority Interest or (b) is of all, but not less than all, of its General Partner Interest to (i) an Affiliate of the General Partner or (ii) another Person in connection with the merger or consolidation of the General Partner with or into another Person or the transfer by the General Partner of all or substantially all of its assets to another Person. Notwithstanding anything herein to the contrary, no transfer by the General Partner of all or any part of its General Partner Interest to another Person shall be permitted unless (x) the transferee agrees to assume the rights and duties of the General Partner under this Agreement and the Fourth Amended OLP Agreement and to be bound by the provisions of this Agreement and the Fourth Amended OLP Agreement, (y) the Partnership receives an Opinion of Counsel that such transfer would not result in the loss of limited liability of any Limited Partner, of any limited partner of Genesis OLP or cause the Partnership or Genesis OLP to be treated as an association taxable as a corporation or otherwise to be taxed as an entity for federal income tax purposes (to the extent not already so treated or taxed) and (z) such transferee also agrees to purchase all (or the appropriate portion thereof, if applicable) of the partnership interest of the General Partner as the general partner of each other Group Member.  In the case of a transfer pursuant to and in compliance with this Section 4.6 , the transferee or successor (as the case may be) shall, subject to compliance with the terms of Section 10.3 , be admitted to the Partnership as a General Partner immediately prior to the transfer of the General Partner Interest, and the business of the Partnership shall continue without dissolution.

 
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4.7            Restrictions on Transfers .

(a)            Notwithstanding the other provisions of this Article IV , no transfer of any Partnership Interest shall be made if such transfer would (i) violate the then applicable federal or state securities laws or rules and regulations of the Commission, any state securities commission or any other governmental authority with jurisdiction over such transfer, (ii) terminate the existence or qualification of the Partnership or Genesis OLP under the laws of the jurisdiction of its formation or (iii) cause the Partnership or Genesis OLP to be treated as an association taxable as a corporation or otherwise to be taxed as an entity for federal income tax purposes (to the extent not already so treated or taxed).

(b)            The General Partner may impose restrictions on the transfer of Partnership Interests if a subsequent Opinion of Counsel determines that such restrictions are necessary to avoid a significant risk of the Partnership or Genesis OLP becoming taxable as a corporation or otherwise to be taxed as an entity for federal income tax purposes. The restrictions may be imposed by making such amendments to this Agreement as the General Partner may determine to be necessary or appropriate to impose such restrictions; provided , however , that any amendment that the General Partner believes, in the exercise of its reasonable discretion, could result in the delisting or suspension of trading of any class of Limited Partner Interests on the principal National Securities Exchange on which such class of Limited Partner Interests is then traded must be approved, prior to such amendment being effected, by the holders of at least a majority of the Outstanding Limited Partner Interests of such class.

(c)            Nothing contained in this Article IV , or elsewhere in this Agreement, shall preclude the settlement of any transactions involving Partnership Interests entered into through the facilities of any National Securities Exchange on which such Partnership Interests are listed for trading.

4.8            Citizenship Certificates; Non-citizen Assignees .

(a)            If any Group Member is or becomes subject to any federal, state or local law or regulation that, in the reasonable determination of the General Partner, creates a substantial risk of cancellation or forfeiture of any property in which the Group Member has an interest based on the nationality, citizenship or other related status of a Limited Partner or Assignee, the General Partner may request any Limited Partner or Assignee to furnish to the General Partner, within 30 days after receipt of such request, an executed Citizenship Certification or such other information concerning his nationality, citizenship or other related status (or, if the Limited Partner or Assignee is a nominee holding for the account of another Person, the nationality, citizenship or other related status of such Person) as the General Partner may request. If a Limited Partner or Assignee fails to furnish to the General Partner within the aforementioned 30-day period such Citizenship Certification or other requested information or if upon receipt of such Citizenship Certification or other requested information the General Partner determines, with the advice of counsel, that a Limited Partner or Assignee is not an Eligible Citizen, the Limited Partner Interests owned by such Limited Partner or Assignee shall be subject to redemption in accordance with the provisions of Section 4.9 . In addition, the General Partner may require that the status of any such Limited Partner or Assignee be changed to that of a Non-citizen Assignee and, thereupon, the General Partner shall be substituted for such Non-citizen Assignee as the Limited Partner in respect of his Limited Partner Interests.

 
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(b)            The General Partner shall, in exercising voting rights in respect of Limited Partner Interests held by it on behalf of Non-citizen Assignees, distribute the votes in the same ratios as the votes of Limited Partners (including without limitation the General Partner) in respect of Limited Partner Interests other than those of Non-citizen Assignees are cast, either for, against or abstaining as to the matter.

(c)            Upon dissolution of the Partnership, a Non-citizen Assignee shall have no right to receive a distribution in kind pursuant to Section 12.4 but shall be entitled to the cash equivalent thereof, and the Partnership shall provide cash in exchange for an assignment of the Non-citizen Assignee’s share of the distribution in kind. Such payment and assignment shall be treated for Partnership purposes as a purchase by the Partnership from the Non-citizen Assignee of his Limited Partner Interest (representing his right to receive his share of such distribution in kind).

(d)            At any time after he can and does certify that he has become an Eligible Citizen, a Non-citizen Assignee may, upon application to the General Partner, request admission as a Substituted Limited Partner with respect to any Limited Partner Interests of such Non-citizen Assignee not redeemed pursuant to Section 4.9, and upon his admission pursuant to Section 10.2, the General Partner shall cease to be deemed to be the Limited Partner in respect of the Non-citizen Assignee’s Limited Partner Interests.

4.9            Redemption of Partnership Interests of Non-citizen Assignees .

(a)            If at any time a Limited Partner or Assignee fails to furnish a Citizenship Certification or other information requested within the 30-day period specified in Section 4.8(a) , or if upon receipt of such Citizenship Certification or other information the General Partner determines, with the advice of counsel, that a Limited Partner or Assignee is not an Eligible Citizen, the Partnership may, unless the Limited Partner or Assignee establishes to the satisfaction of the General Partner that such Limited Partner or Assignee is an Eligible Citizen or has transferred his Limited Partner Interests to a Person who is an Eligible Citizen and who furnishes a Citizenship Certification to the General Partner prior to the date fixed for redemption as provided below, redeem the Limited Partner Interest of such Limited Partner or Assignee as follows:

 
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(i)             The General Partner shall, not later than the 30th day before the date fixed for redemption, give notice of redemption to the Limited Partner or Assignee, at his last address designated on the records of the Partnership or the Transfer Agent, by registered or certified mail, postage prepaid. The notice shall be deemed to have been given when so mailed. The notice shall specify the Redeemable Interests, the date fixed for redemption, the place of payment, that payment of the redemption price will be made upon surrender of the Certificate evidencing the Redeemable Interests, or if the Redeemable Interests are uncertificated Common Units – Class A, other evidence of such uncertificated Common Units – Class A, and that on and after the date fixed for redemption no further allocations or distributions to which the Limited Partner or Assignee would otherwise be entitled in respect of the Redeemable Interests will accrue or be made.

(ii)            The aggregate redemption price for Redeemable Interests shall be an amount equal to the Current Market Price (the date of determination of which shall be the date fixed for redemption) of Limited Partner Interests of the class to be so redeemed multiplied by the number of Limited Partner Interests of each such class included among the Redeemable Interests. The redemption price shall be paid, in the discretion of the General Partner, in cash or by delivery of a promissory note of the Partnership in the principal amount of the redemption price, bearing interest at the rate of 10% annually and payable in three equal annual installments of principal together with accrued interest, commencing one year after the redemption date.

(iii)           Upon surrender by or on behalf of the Limited Partner or Assignee, at the place specified in the notice of redemption, of the Certificate evidencing the Redeemable Interests, or, if the Redeemable Interests are uncertificated Common Units – Class A, other evidence of such uncertificated Common Units – Class A, duly endorsed in blank or accompanied by an assignment duly executed in blank, the Limited Partner or Assignee or his duly authorized representative shall be entitled to receive the payment therefor.

(iv)           After the redemption date, Redeemable Interests shall no longer constitute issued and Outstanding Limited Partner Interests.

(b)            The provisions of this Section 4.9 shall also be applicable to Limited Partner Interests held by a Limited Partner or Assignee as nominee of a Person determined to be other than an Eligible Citizen.

(c)            Nothing in this Section 4.9 shall prevent the recipient of a notice of redemption from transferring his Limited Partner Interests before the redemption date if such transfer is otherwise permitted under this Agreement. Upon receipt of notice of such a transfer, the General Partner shall withdraw the notice of redemption, provided the transferee of such Limited Partner Interests certifies to the satisfaction of the General Partner in a Citizenship Certification delivered in connection with the Transfer Application that he is an Eligible Citizen. If the transferee fails to make such certification, such redemption shall be effected from the transferee on the original redemption date.

 
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ARTICLE V
CAPITAL CONTRIBUTIONS AND ISSUANCE OF
PARTNERSHIP INTERESTS

5.1            Transformation of the General Partner Interest .  The 2% general partner interest in the Partnership that existed immediately prior to the Effective Time is, immediately following the Effective Time, hereby converted into a non-economic, management interest in the Partnership giving the holder of such non-economic, management interest the right and power to manage and control the business and affairs of the Partnership.  Following the Effective Time, the General Partner Interest shall only represent a non-economic, management interest of the General Partner in the Partnership giving the holder of such non-economic, management interest the right and power to manage and control the business and affairs of the Partnership.  Genesis Energy, LLC hereby continues as general partner of the Partnership and the Partnership is hereby continued without dissolution.

5.2            Cancellation of Incentive Distribution Rights .   The Incentive Distribution Rights that existed immediately prior to the Effective Time are, immediately following the Effective Time, hereby canceled.  Following the Effective Time, no Person, in its capacity as a former holder of the Incentive Distribution Rights, shall have any rights with respect to the Partnership as a former holder of the Incentive Distribution Rights, including the right to receive any distributions from the Partnership.

5.3            Previous Capital Contributions .  The Partners (or their predecessors) have heretofore made Capital Contributions to the Partnership as provided in the First Amended Agreement.

5.4            Interest and Withdrawal .  No interest shall be paid by the Partnership on Capital Contributions. No Partner or Assignee shall be entitled to the withdrawal or return of its Capital Contribution, except to the extent, if any, that distributions made pursuant to this Agreement or upon termination of the Partnership may be considered as such by law and then only to the extent provided for in this Agreement. Except to the extent expressly provided in this Agreement, no Partner or Assignee shall have priority over any other Partner or Assignee either as to the return of Capital Contributions or as to profits, losses or distributions. Any such return shall be a compromise to which all Partners and Assignees agree within the meaning of Section 17-502(b) of the Delaware Act.

5.5            Capital Accounts .

(a)            The Partnership shall maintain for each Partner (or a beneficial owner of Partnership Interests held by a nominee in any case in which the nominee has furnished the identity of such owner to the Partnership in accordance with Section 6031(c) of the Code or any other method acceptable to the General Partner in its sole discretion) owning a Partnership Interest a separate Capital Account with respect to such Partnership Interest in accordance with the rules of Treasury Regulation Section 1.704-1(b)(2)(iv). Such Capital Account shall be increased by (i) the amount of all Capital Contributions made to the Partnership with respect to such Partnership Interest pursuant to this Agreement (including the Third Amended Agreement) and (ii) all items of Partnership income and gain (including, without limitation, income and gain exempt from tax) computed in accordance with Section 5.5(b) and allocated with respect to such Partnership Interest pursuant to Section 6.1 , and decreased by (x) the amount of cash or Net Agreed Value of all actual and deemed distributions of cash or property made with respect to such Partnership Interest and (y) all items of Partnership deduction and loss computed in accordance with Section 5.5(b) and allocated with respect to such Partnership Interest pursuant to Section 6.1 .

 
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(b)            For purposes of computing the amount of any item of income, gain, loss or deduction which is to be allocated pursuant to Article VI and is to be reflected in the Partners’ Capital Accounts, the determination, recognition and classification of any such item shall be the same as its determination, recognition and classification for federal income tax purposes (including, without limitation, any method of depreciation, cost recovery or amortization used for that purpose), provided, that:

(i)             Solely for purposes of this Section 5.5 , the Partnership shall be treated as owning directly its proportionate share (as determined by the General Partner based upon the provisions of the Fourth Amended OLP Agreement) of all property owned by Genesis OLP or any other Subsidiary that is classified as a partnership for federal income tax purposes.

(ii)            All underwriting discounts and commissions incurred by the Partnership in connection with the issuance of Partnership Securities that can neither be deducted nor amortized under Section 709 of the Code shall, for purposes of Capital Account maintenance, be treated as an item of deduction at the time such costs are incurred and shall be allocated 100% to the holders of such Partnership Securities in accordance with their relative Percentage Interests. All other fees and other expenses incurred by the Partnership to promote the sale of (or to sell) Partnership Securities that can neither be deducted nor amortized under Section 709 of the Code, if any, shall, for purposes of Capital Account maintenance, be treated as an item of deduction at the time such fees and other expenses are incurred and shall be allocated among the Partners pursuant to Section 6.1 .

(iii)           Except as otherwise provided in Treasury Regulation Section 1.704- 1(b)(2)(iv)(m), the computation of all items of income, gain, loss and deduction shall be made without regard to any election under Section 754 of the Code which may be made by the Partnership and, as to those items described in Section 705(a)(1)(B) or 705(a)(2)(B) of the Code, without regard to the fact that such items are not includable in gross income or are neither currently deductible nor capitalized for federal income tax purposes. To the extent an adjustment to the adjusted tax basis of any Partnership asset pursuant to Section 734(b) or 743(b) of the Code is required, pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(m) to be taken into account in determining Capital Accounts, the amount of such adjustment in the Capital Accounts shall be treated as an item of gain or loss.

 
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(iv)           Any income, gain or loss attributable to the taxable disposition of any Partnership property shall be determined as if the adjusted basis of such property as of such date of disposition were equal in amount to the Partnership’s Carrying Value with respect to such property as of such date.

(v)            In accordance with the requirements of Section 704(b) of the Code, any deductions for depreciation, cost recovery or amortization attributable to any Contributed Property shall be determined as if the adjusted basis of such property on the date it was acquired by the Partnership were equal to the Agreed Value of such property. Upon an adjustment pursuant to Section 5.5(d) to the Carrying Value of any Partnership property subject to depreciation, cost recovery or amortization, any further deductions for such depreciation, cost recovery or amortization attributable to such property shall be determined (A) as if the adjusted basis of such property were equal to the Carrying Value of such property immediately following such adjustment and (B) using a rate of depreciation, cost recovery or amortization derived from the same method and useful life (or, if applicable, the remaining useful life) as is applied for federal income tax purposes; provided , however , that, if the asset has a zero adjusted basis for federal income tax purposes, depreciation, cost recovery or amortization deductions shall be determined using any reasonable method that the General Partner may adopt.

(vi)           If the Partnership’s adjusted basis in a depreciable or cost recovery property is reduced for federal income tax purposes pursuant to Section 50(c)(1) or 50(c)(2) of the Code, the amount of such reduction shall, solely for purposes hereof, be deemed to be an additional depreciation or cost recovery deduction in the year such property is placed in service and shall be allocated among the Partners pursuant to Section 6.1 . Any restoration of such basis pursuant to Section 50(c)(2) of the Code shall, to the extent possible, be allocated in the same manner to the Partners to whom such deemed deduction was allocated.

(c)            A transferee of a Partnership Interest shall succeed to a pro rata portion of the Capital Account of the transferor relating to the Partnership Interest so transferred.

(d)            (i) In accordance with Treasury Regulation Section 1.704-1(b)(2)(iv)(f), on an issuance of additional Partnership Interests for cash or Contributed Property or the conversion of a Waiver Unit to a Common Unit, the Capital Account of all Partners and the Carrying Value of each Partnership property immediately prior to such issuance or immediately after such conversion (with respect to the conversion of a Waiver Unit to a Common Unit) shall be adjusted upward or downward to reflect any Unrealized Gain or Unrealized Loss attributable to such Partnership property, as if such Unrealized Gain or Unrealized Loss had been recognized on an actual sale of each such property immediately prior to such issuance or on the date of such conversion and had been allocated to the Partners in the same manner as any item of gain or loss actually recognized during such period would have been allocated. Any such Unrealized Gain or Unrealized Loss (or items thereof) shall be allocated (A) if the operation of this sentence is triggered by the conversion of a Waiver Unit, first to the Partners holding converted Waiver Units until the Capital Account of each converted Waiver Unit is equal to the Per Unit Capital Amount for a then Outstanding Common Unit (other than a converted Waiver Unit), and (B) any remaining Unrealized Gain or Unrealized Loss shall be allocated among the Partners in the same manner as any item of gain or loss actually recognized would have been allocated. If the Unrealized Gain or Unrealized Loss allocated as a result of the conversion of a Waiver Unit is not sufficient to cause the Capital Account of each converted Waiver Unit to equal the Per Unit Capital Amount for a then Outstanding Common Unit, then Capital Account balances shall be reallocated between the Partners holding converted Waiver Units and the Partners holding Common Units (other than converted Waiver Units) so as to cause the Capital Account of each converted Waiver Unit to equal the Per Unit Capital Amount for a then Outstanding Common Unit (other than a converted Waiver Unit), in accordance with Proposed Treasury Regulation Section 1.704-1(b)(2)(iv)(s)(3). In determining such Unrealized Gain or Unrealized Loss, the aggregate cash amount and fair market value of all Partnership assets (including, without limitation, cash or cash equivalents) immediately prior to the issuance of additional Partnership Interests shall be determined by the General Partner using such reasonable method of valuation as it may adopt; provided , however , that the General Partner, in arriving at such valuation, must take fully into account the fair market value of the Partnership Interests of all Partners at such time.

 
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(ii)            In accordance with Treasury Regulation Section 1.704-1(b)(2)(iv) (f), immediately prior to any actual or deemed distribution to a Partner of any Partnership property (other than a distribution of cash that is not in redemption or retirement of a Partnership Interest), the Capital Accounts of all Partners and the Carrying Value of all Partnership property shall be adjusted upward or downward to reflect any Unrealized Gain or Unrealized Loss attributable to such Partnership property, as if such Unrealized Gain or Unrealized Loss had been recognized in a sale of such property immediately prior to such distribution for an amount equal to its fair market value, and had been allocated to the Partners, at such time, pursuant to Section 6.1 in the same manner as any item of gain or loss actually recognized during such period would have been allocated. In determining such Unrealized Gain or Unrealized Loss the aggregate cash amount and fair market value of all Partnership assets (including, without limitation, cash or cash equivalents) immediately prior to a distribution shall (A) in the case of an actual distribution that is not made pursuant to Section 12.4 or in the case of a deemed contribution and/or distribution occurring as a result of a termination of the Partnership pursuant to Section 708 of the Code, be determined and allocated in the same manner as that provided in Section 5.5(d)(i) or (B) in the case of a liquidating distribution pursuant to Section 12.4 , be determined and allocated by the Liquidator using such reasonable method of valuation as it may adopt.

5.6            Issuances of Additional Partnership Securities .

(a)            The Partnership may issue additional Partnership Securities and options, rights, warrants and appreciation rights relating to Partnership Securities for any Partnership purpose at any time and from time to time to such Persons for such consideration and on such terms and conditions as shall be established by the General Partner in its sole discretion, all without the approval of any Limited Partners.

 
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(b)            Each additional Partnership Security authorized to be issued by the Partnership pursuant to Section 5.6(a) may be issued in one or more classes, or one or more series of any such classes, with such designations, preferences, rights, powers and duties (which may be senior to existing classes and series of Partnership Securities), as shall be fixed by the General Partner in the exercise of its sole discretion, including (i) the right to share Partnership profits and losses or items thereof; (ii) the right to share in Partnership distributions; (iii) the rights upon dissolution and liquidation of the Partnership; (iv) whether, and the terms and conditions upon which, the Partnership may redeem such Partnership Security; (v) whether such Partnership Security is issued with the privilege of conversion or exchange and, if so, the terms and conditions of such conversion or exchange; (vi) the terms and conditions upon which such Partnership Security will be issued, evidenced by certificates and assigned or transferred; (vii) the method for determining the Percentage Interest as to such Partnership Security and (viii) the right, if any, of such Partnership Security to vote on Partnership matters, including matters relating to the relative rights, preferences and privileges of such Partnership Security.

(c)            The General Partner is hereby authorized and directed to take all actions that it deems necessary or appropriate in connection with (i) each issuance of Partnership Securities pursuant to this Section 5.6 , (ii) the conversion of the General Partner Interest into Common Units pursuant to the terms of this Agreement, (iii) the admission of Additional Limited Partners and (iv) all additional issuances of Partnership Securities. The General Partner is further authorized and directed to specify the relative rights, powers and duties of the holders of Partnership Securities being so issued. The General Partner shall do all things necessary to comply with the Delaware Act and is authorized and directed to do all things it deems to be necessary or advisable in connection with any future issuance of Partnership Securities or in connection with the conversion of the General Partner Interest into Common Units pursuant to the terms of this Agreement, including compliance with any statute, rule, regulation or guideline of any federal, state or other governmental agency or any National Securities Exchange on which the Common Units, Waiver Units or other Partnership Securities are listed for trading.

(d)            No fractional Units shall be issued by the Partnership.

5.7            No Preemptive Right .  No Person shall have any preemptive, preferential or other similar right with respect to (a) additional Capital Contributions; (b) the issuance of any class or series of Partnership Interests, whether unissued, held in the treasury or hereafter created; (c) issuance of obligations, evidence of indebtedness or other securities of the Partnership convertible into or exchangeable for, or carrying or accompanied by any rights to receive, purchase or subscribe to, any such Partnership Interests; (d) issuance of any right of subscription to or right to receive, or any warrant or option for the purchase of, any such Partnership Interests; or (e) issuance or sale of any other securities that may be issued or sold by the Partnership.

5.8            Splits and Combinations .

(a)            Subject to Section 5.8(d) (dealing with adjustments of distribution levels), the Partnership may make a Pro Rata distribution of Partnership Securities to all Record Holders or may effect a subdivision or combination of Partnership Securities so long as, after any such event, each Partner shall have the same Percentage Interest in the Partnership as before such event, and any amounts calculated on a per Unit basis or stated as a number of Units (including the number of Waiver Units) are proportionately adjusted.

 
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(b)            Whenever such a distribution, subdivision or combination of Partnership Securities is declared, the General Partner shall select a Record Date as of which the distribution, subdivision or combination shall be effective and shall send notice thereof at least 20 days prior to such Record Date to each Record Holder as of a date not less than 10 days prior to the date of such notice. The General Partner also may cause a firm of independent public accountants selected by it to calculate the number of Partnership Securities to be held by each Record Holder after giving effect to such distribution, subdivision or combination. The General Partner shall be entitled to rely on any certificate provided by such firm as conclusive evidence of the accuracy of such calculation.

(c)            Promptly following any such distribution, subdivision or combination, the Partnership may issue Certificates or uncertificated Common Units – Class A to the Record Holders of Partnership Securities as of the applicable Record Date representing the new number of Partnership Securities held by such Record Holders, or the General Partner may adopt such other procedures as it may deem appropriate to reflect such changes. If any such combination results in a smaller total number of Partnership Securities Outstanding, the Partnership shall require, as a condition to the delivery to a Record Holder of such new Certificate or uncertificated Common Units – Class A, the surrender of any Certificate, or other evidence of uncertificated Common Units – Class A held by such Record Holder immediately prior to such Record Date.

(d)            The Partnership shall not issue fractional Units upon any distribution, subdivision or combination of Units. If a distribution, subdivision or combination of Units would result in the issuance of fractional Units but for the provisions of Section 5.6(d) and this Section 5.8(d) , each fractional Unit shall be rounded to the nearest whole Unit (and a 0.5 Unit shall be rounded to the next higher Unit).

5.9            Fully Paid and Non-Assessable Nature of Limited Partner Interests .  All Limited Partner Interests issued pursuant to, and in accordance with the requirements of, this Article V shall be fully paid and non-assessable Limited Partner Interests in the Partnership, except as such non-assessability may be affected by Section 17-607 of the Delaware Act.

5.10          Establishment of Waiver Units .

(a)             General . The Partnership hereby designates and creates four classes of Units to be designated as the “ Waiver Units – Class 1 ”, “ Waiver Units – Class 2 ”, “ Waiver Units - Class 3 ” and “ Waiver Units – Class 4 ” (collectively, the “ Waiver Units ”), with each such class consisting of a total of 1,750,000 Units.

(b)             Rights of Waiver Units . The Waiver Units shall have the following rights, preferences and privileges and shall be subject to the following duties and obligations:

 
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(i)              Allocations .

(A)           Notwithstanding anything to the contrary in Section 6.1(a) , Net Income or items of gross income or gain shall be allocated to the Unitholders holding Waiver Units in an amount equal to the distributions they receive pursuant to Section 5.10(b)(ii) until the aggregate amount of such items allocated to the Unitholders holding Waiver Units pursuant to this paragraph 5.10(b)(i)(A) for the current taxable year and all previous taxable years is equal to the cumulative amount of all distributions made under Section 5.10(b)(ii) to the Unitholders holding Waiver Units.

(B)            Notwithstanding anything to the contrary in Section 6.1(a) , Net Loss shall not be allocated to the Unitholders holding Waiver Units; provided , however , if any Waiver Units remain unconverted on January 1, 2021, then Net Loss or items of deduction or loss shall be allocated to the Unitholders of Waiver Units for the taxable year or portion thereof in which January 1, 2021 falls until their Capital Accounts have been reduced to a zero balance.

(ii)             Distributions .  Commencing with the Quarter ending March 31, 2011, the Holders of the Waiver Units as of an applicable Record Date shall be entitled to receive Partnership distributions in an amount equal to $0.001786 per Waiver Unit; provided , however , that Waiver Units (i) issued and Outstanding (or deemed issued and outstanding or held by a Record Holder) during such Quarter, (ii) entitled to a distribution with respect to such Quarter, and (iii) Outstanding for less than the entire Quarter, shall be entitled only to a pro rata distribution based on the number of days in such Quarter during which such Unit was (or was deemed) Outstanding.

(iii)            Voting Rights .

(A)           Except as provided in clause (B) below, the Waiver Units shall have no voting rights (including with respect to a merger or consolidation of the Partnership). Each reference in this Agreement to a vote of holders of Common Units shall be deemed to be a reference solely to the holders of Common Units, and not the Waiver Units, and the definitions of “ Majority Interest ”, “ Two-Thirds Interest ” and “ Ninety Percent Interest ” and similar concepts shall correspondingly be construed to mean the requisite Voting Power of only the Common Units and not the Waiver Units.

(B)            Notwithstanding any other provision of this Agreement, in addition to all other requirements imposed by Delaware law, the affirmative vote of the holders of a majority of a class of such Outstanding Waiver Units, voting separately as a class based upon one vote per such Waiver Unit, shall be necessary on any matter (other than pursuant to a merger or consolidation of the Partnership) that amends or modifies any of the terms of such class of Waiver Units; provided, that the General Partner shall be able to amend this Section 5.10 so long as the amendment does not adversely affect the holders of a class of Waiver Units. Without limiting the generality of the preceding sentence, such adverse amendment includes any action that would:

 
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(1)            change the term of payment of distributions, defer the date from which distributions on the Waiver Units shall accrue, cancel accrued and unpaid distributions on the Waiver Units or defer the date on which a class of Waiver Units will convert into Common Units – Class A;

(2)            reduce the amount payable or change the form of payment to the holders of the Waiver Units upon the voluntary or involuntary liquidation, dissolution or winding up of the Partnership; or

(3)            make any distribution of property other than cash or other property required or permitted by this Section 5.10 .

(iv)           Certificates.

(A)           The Waiver Units shall be evidenced by certificates in such form as the General Partner may approve and, subject to the satisfaction of any applicable legal, regulatory and contractual requirements, may be assigned or transferred in a manner identical to the assignment and transfer of other Units; unless and until the General Partner determines to assign the responsibility to another Person, the General Partner will act as the registrar and transfer agent for the Waiver Units. The certificates evidencing Waiver Units shall be separately identified and shall not bear the same CUSIP number as the certificates evidencing Common Units.

(B)            The certificate(s) representing the Waiver Units may be imprinted with a legend in substantially the following form:

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.  THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD, PLEDGED, HYPOTHECATED, ASSIGNED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933 (AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS OR ANY RULE OR REGULATION PROMULGATED THEREUNDER) OR AN OPINION OF COUNSEL SATISFACTORY TO THE PARTNERSHIP’S COUNSEL THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR THE SUBMISSION TO THE PARTNERSHIP’S COUNSEL OF SUCH OTHER EVIDENCE AS MAY BE SATISFACTORY TO THE PARTNERSHIP TO THE EFFECT THAT ANY SUCH TRANSFER SHALL NOT BE IN VIOLATION OF SAID ACT OF 1933.”

 
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(v)            Conversion.

(A)           On the first day of the Quarter, if any, for which both payment of a Quarterly cash distribution on the Common Units equals or exceeds $0.43 per Common Unit and the Coverage Ratio (as calculated with respect to the previous Quarter pursuant to which such distribution is attributable) is at least 1.10, each of the Waiver Units – Class 1, shall become convertible at the option of the holder thereof into a Common Unit – Class A at a conversion ratio of one Waiver Unit for one Common Unit – Class A (the “ Conversion Ratio ”) as provided in this Section 5.10(b)(v) .  By way of example, if the Quarterly cash distribution paid on November 12, 2011 for the Quarter ended September 30, 2011 is $0.43 and the Coverage Ratio for the Quarter ended September 30, 2011 is at least 1.10, the Waiver Units – Class 1, shall become convertible as of October 1, 2011 (assuming they had not previously converted).

(B)           On the first day of the Quarter, if any, for which both payment of a Quarterly cash distribution on the Common Units equals or exceeds $0.46 per Common Unit and the Coverage Ratio (as calculated with respect to the previous Quarter pursuant to which such distribution is attributable) is at least 1.10, each of the Waiver Units – Class 2, shall become convertible at the option of the holder thereof into a Common Unit – Class A at the Conversion Ratio as provided in this Section 5.10(b)(v) .

(C)           On the first day of the Quarter, if any, for which both payment of a Quarterly cash distribution on the Common Units equals or exceeds $0.49 per Common Unit and the Coverage Ratio (as calculated with respect to the previous Quarter pursuant to which such distribution is attributable) is at least 1.10, each of the Waiver Units – Class 3, shall become convertible at the option of the holder thereof into a Common Unit – Class A at the Conversion Ratio as provided in this Section 5.10(b)(v) .

(D)           On the first day of the Quarter, if any, for which both payment of a Quarterly cash distribution on the Common Units equals or exceeds $0.52 per Common Unit and the Coverage Ratio (as calculated with respect to the previous Quarter pursuant to which such distribution is attributable) is at least 1.10, each of the Waiver Units – Class 4, shall become convertible at the option of the holder thereof into a Common Unit – Class A at the Conversion Ratio as provided in this Section 5.10(b)(v) .

(E)            Immediately upon a Change of Control, all Outstanding Waiver Units shall become convertible at the option of the holder thereof into Common Units – Class A at the Conversion Ratio as provided in this Section 5.10(b)(v) , subject to Special Approval of such Change of Control transaction.

 
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(F)            Immediately, upon the death, Disability or termination by the Partnership or the Company from such employment without Executive Cause of an Executive, all Outstanding Waiver Units held by such Executive shall become convertible at the option of the holder thereof into Common Units – Class A at the Conversion Ratio as provided in this Section 5.10(b)(v) ; provided, that references herein to such Executive in his or her capacity as a Unitholder shall be deemed to include such Executive’s estate or a duly appointed representative, as applicable.

(G)           Commencing on the applicable Conversion Right Date, each of the holders of such class of Waiver Units shall have the right, at the option of such holder, to convert from time to time its Waiver Units into Common Units – Class A, subject to the conditions set forth in this Section 5.10(b)(v) .  Any Common Units – Class A delivered as a result of conversion hereunder shall be fully paid, validly issued and non-assessable (except as provided in Section 5.9 ), free and clear of any liens, claims, rights or encumbrances.  To convert Waiver Units into Common Units – Class A pursuant to this Section 5.10(b)(v) , the holder shall give written notice (a “ Waiver Unit Conversion Notice ”) to the Partnership in the form of Exhibit A attached hereto stating that such holder elects to so convert Waiver Units and shall state therein (i) the number of Waiver Units to be converted and (ii) the name or names in which such holder wishes the certificate or certificates for Common Units – Class A to be issued.  The date of any Waiver Unit Conversion Notice shall be hereinafter be referred to as a “ Waiver Unit Conversion Notice Date .”

(H)           On the six-month anniversary of the applicable Conversion Right Date (the “ Waiver Unit Automatic Conversion Date ”), subject to the terms of this Section 5.10(b)(v) , each Waiver Unit in such class not previously converted shall automatically convert into a Common Unit – Class A.  Ten days prior to the applicable Waiver Unit Automatic Conversion Date pursuant to this Section 5.10(b)(v)(H) or (to the extent reasonably practicable)  a Change of Control pursuant to 5.10(b)(v)(E) , the Partnership shall give written notice (a “ Waiver Units Automatic Conversion Notice ”) to each holder of Waiver Units stating that the applicable class of Waiver Units shall automatically convert pursuant to Section 5.10(b)(v)(H) or shall become convertible pursuant to Section 5.10(b)(v)(E) on the applicable Waiver Unit Automatic Conversion Date or upon such Change of Control (as the case may be).  If a holder does not provide written notice to the Partnership of the name or names in which such holder wishes the certificate or certificates for Common Units – Class A to be issued (if applicable) within five Business Days after receipt of the Waiver Units Automatic Conversion Notice, then the certificate or certificates for Common Units – Class A shall be issued to the Record Holder of such Waiver Units.

 
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(I)             In the event that a Waiver Units Conversion Notice is delivered by a holder of Waiver Units to the Partnership pursuant to Section 5.10(b)(v)(G) , or a Waiver Units Automatic Conversion Notice is delivered (or is required to be delivered) by the Partnership to a holder of Waiver Units pursuant to Section 5.10(b)(v)(H) , the Partnership shall issue the Common Units – Class A as soon as reasonably practicable, and in any event no later than 10 days after the deemed conversion date under this Section 5.10(b)(v)(I) (other than in the event of a Change of Control, in which case the Company shall issue (or shall have been deemed to issue) such certificates no later than immediately prior to such Change of Control), subject to the receipt by the Partnership of certificate(s) evidencing the Waiver Units so converted (the date of issuance of such Common Units – Class A, the “ Waiver Unit Surrender Date ”).  On or before the Waiver Units Surrender Date and subject to the book-entry provisions set forth below, such holder shall surrender the certificate or certificates representing the Waiver Units being converted, duly endorsed, at the office of the Partnership or, if identified in writing to such holder by the Partnership, at the offices of any Transfer Agent for such Units.  On the Waiver Units Surrender Date, the Partnership shall issue to such holder a Certificate or Certificates for the number of Common Units – Class A to which such holder shall be entitled (with the number of and denomination of such certificates designated by such holder). In lieu of delivering physical certificates representing the Common Units – Class A issuable upon conversion of Waiver Units, provided the Transfer Agent is participating in the Depository’s Fast Automated Securities Transfer program, upon request of the holder, the Partnership shall use its commercially reasonable efforts to cause its Transfer Agent to electronically transmit the Common Units – Class A issuable upon conversion, by crediting the account of the holder’s prime broker with the Depository through its Deposit Withdrawal Agent Commission (“ DWAC ”) system. The parties agree to coordinate with the Depository to accomplish this objective. Notwithstanding anything herein to the contrary, the conversion pursuant to this Section 5.10(b)(v) shall be deemed to have been made immediately prior to the open of business (i) on the first day of the month following the Waiver Unit Conversion Notice Date or (ii) on the Waiver Units Automatic Conversion Date, as applicable; provided , however , that (i) in the event of a conversion event under Section 5.10(b)(v)(F) , conversion shall be deemed to have occurred immediately prior to the open of business on the first day of the month following the Waiver Unit Automatic Conversion Date (if not earlier converted pursuant to a Waiver Unit Conversion Notice), and (ii) in the event of a conversion event under Section 5.10(b)(v)(E) , conversion shall be deemed to have occurred prior to such event and on the first day of the month in which such event occurs (if not earlier converted pursuant to a Waiver Unit Conversion Notice).  The Person or Persons entitled to receive the Common Units – Class A issuable upon such conversion shall be treated for all purposes as the Record Holder or Holders of such Common Units – Class A as of the time such conversion shall have been deemed to occur pursuant to the preceding sentence; provided , however , that notwithstanding anything in this Agreement to the contrary, no distribution shall be made on Common Units – Class A received upon conversion of Waiver Units with respect to the Quarterly distribution pursuant to which such Waiver Units became convertible.

(J)            Any Waiver Units that have not become convertible by January 1, 2021 shall, as of the close of business on such date, automatically be cancelled and cease to be Outstanding without any action on the part of the Partnership, a Unitholder or any other party.

 
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(vi)            Adjustment of Waiver Target Distribution .  Each of the $0.43, $0.46, $0.49 and $0.52 per Common Unit – Class A target thresholds specified under Section 5.10(b)(v) as triggering a conversion of any Waiver Unit into a certain number of Common Units – Class A shall be proportionately adjusted in the event of any distribution, combination or subdivision (whether effected by a distribution payable in Units or otherwise) of Units or other Partnership Securities in accordance with Section 5.8 .

(vii)           Adjustment of Distribution Rate .  Each of the distributions specified under Section 5.10(b)(ii) shall be proportionately adjusted in the event of any distribution, combination or subdivision (whether effected by a distribution payable in Units or otherwise) of Units or other Partnership Securities in accordance with Section 5.8 .

(viii)         The Partnership shall pay any and all issue, documentary, stamp and other taxes, excluding any income, franchise, property or similar taxes, that may be payable in respect of any issue or delivery of Common Units – Class A on conversion of, or payment of distributions on, Waiver Units pursuant hereto. However, the holder of any Waiver Units shall pay any tax that is due because the Common Units – Class A issuable upon conversion thereof or distribution payment thereon are issued in a name other than such holder’s name.

(ix)           The Partnership agrees that it will act in good faith to make any adjustment(s) required by this Section 5.10(b) equitably and in such a manner as to afford the holders of Waiver Units the benefits of the provisions hereof, and will not take any action to deprive such holders of the benefit hereof.

5.11          Establishment of Common Units – Class B .

(a)             General . The Partnership hereby designates and creates a class of Units to be designated as the “ Common Units – Class B ,” consisting of a total of 40,000 Units.

(b)             Rights of Common Units – Class B .

(i)             Except as provided in this Section 5.11 , the Common Units – Class B shall have all rights, preferences and privileges of the Common Units – Class A.

(ii)            The Common Units – Class B shall vote as a class together with the Common Units – Class A, as a single class on all matters in which the Common Units may vote; provided, that the Common Units – Class B, shall have the right to, voting as class, elect the Directors of the General Partner, as set forth in Section 13.4(b) , and take all other actions specified therein relating to the Common Units – Class B, subject to the provisions of Section 11.3 .

 
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(iii)           Notwithstanding any other provision of this Agreement, in addition to all other requirements imposed by Delaware law, the affirmative vote of the holders of a majority of the Outstanding Common Units – Class B, voting separately as a class based upon one vote per such Common Unit – Class B, shall be necessary on any matter (other than pursuant to a merger or consolidation of the Partnership) that amends or modifies any of the terms of the Common Units – Class B; provided, that the Partnership shall be able to amend this Section 5.11 so long as the amendment does not adversely affect the holders of the Common Units – Class B. Without limiting the generality of the preceding sentence, such adverse amendment includes any action that would:

(A)           amend Section 13.4(b) (or Section 13.11 to the extent relating thereto);

(B)           change the term of payment of distributions, defer the date from which distributions on the Common Units – Class B shall accrue, cancel accrued and unpaid distributions on the Common Units – Class B or defer the date on which the Common Units – Class B will convert into Common Units – Class A;

(C)           reduce the amount payable or change the form of payment to the holders of the Common Units – Class B upon the voluntary or involuntary liquidation, dissolution or winding up of the Partnership; or

(D)           make any distribution of property other than cash or other property required or permitted by this Section 5.11 .

(iv)           Commencing with the Quarter ending on March 31, 2011, the holders of the Class B Units as of an applicable Record Date shall be entitled to receive Partnership distributions pursuant to Section 6.3 .

(c)             Certificates .

(i)             The Common Units – Class B shall be evidenced by certificates in such form as the General Partner may approve and, subject to the satisfaction of any applicable legal, regulatory and contractual requirements, may be assigned or transferred in a manner identical to the assignment and transfer of other Units; unless and until the General Partner determines to assign the responsibility to another Person, the General Partner will act as the registrar and transfer agent for the Common  Units – Class B. The certificates evidencing Common Units – Class B shall be separately identified and shall not bear the same CUSIP number as the certificates evidencing Common Units – Class A.

(ii)            The certificate(s) representing the Common Units – Class B may be imprinted with a legend in substantially the following form:

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.  THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD, PLEDGED, HYPOTHECATED, ASSIGNED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933 (AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS OR ANY RULE OR REGULATION PROMULGATED THEREUNDER) OR AN OPINION OF COUNSEL SATISFACTORY TO THE PARTNERSHIP’S COUNSEL THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR THE SUBMISSION TO THE PARTNERSHIP’S COUNSEL OF SUCH OTHER EVIDENCE AS MAY BE SATISFACTORY TO THE PARTNERSHIP TO THE EFFECT THAT ANY SUCH TRANSFER SHALL NOT BE IN VIOLATION OF SAID ACT OF 1933.”

 
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(d)             Conversion .  Each Common Unit – Class B shall convert into Common Units – Class A at a conversion ratio of one Common Unit – Class B for one Common Unit – Class A upon (i) automatic conversion pursuant to Section 11.3 (“ Common Unit Automatic Conversion ”) or (ii) at the holder’s election.  Any Common Units – Class A delivered as a result of conversion hereunder shall be fully paid, validly issued and non-assessable (except as provided in Section 5.9 ), free and clear of any liens, claims, rights or encumbrances.  To convert Common Units – Class B into Common Units – Class A pursuant to this Section 5.11(d) the holder shall give written notice (a “ Common Unit Conversion Notice ”) to the Partnership in the form of Exhibit A attached hereto stating that such holder elects to so convert Common Units – Class B and shall state therein (i) the number of Common Units – Class B to be converted and (ii) the name or names in which such holder wishes the certificate or certificates for Common Units – Class A to be issued.  The date of any Common Unit Conversion Notice shall be hereinafter be referred to as a “ Common Unit Conversion Notice Date .”

(e)            In the event a Common Units Conversion Notice is delivered by a holder of Common Units – Class B to the Partnership pursuant to Section 5.11(d) , or upon a Common Units Automatic Conversion, the Partnership shall issue the Common Units – Class A as soon as reasonably practicable, and in any event no later than 10 days after the Common Unit Conversion Notice Date or a Common Units Automatic Conversion, as the case may be, subject to the receipt by the Partnership of certificate(s) evidencing the Common Units – Class B so converted (the date of issuance of such Common Units – Class A, the “ Common Units Conversion Date ”).  On or before the Common Unit Conversion Date and subject to the book-entry provisions set forth below, such holder shall surrender the certificate or certificates representing the Common Units – Class B being converted, duly endorsed, at the office of the Partnership or, if identified in writing to such holder by the Partnership, at the offices of any Transfer Agent for such Units.  On the Common Units Conversion Date, the Partnership shall issue to such holder a Certificate or Certificates for the number of Common Units – Class A to which such holder shall be entitled (with the number of and denomination of such certificates designated by such holder). In lieu of delivering physical certificates representing the Common Units – Class A issuable upon conversion of Common Units – Class B, provided the Transfer Agent is participating in the Depository’s Fast Automated Securities Transfer program, upon request of the holder, the Partnership shall use its commercially reasonable efforts to cause its Transfer Agent to electronically transmit the Common Units – Class A issuable upon conversion by crediting the account of the holder’s prime broker with the Depository through its DWAC system. The parties agree to coordinate with the Depository to accomplish this objective. The conversion pursuant to this Section 5.11(e) shall be deemed to have been made immediately prior to the close of business on the Common Units Conversion Notice Date or the date of the Common Units Automatic Conversion, as applicable.  The Person or Persons entitled to receive the Common Units – Class A issuable upon such conversion shall be treated for all purposes as the Record Holder or Holders of such Common Units – Class A at the close of business on the Common Units Conversion Notice Date or the date of the Common Units Automatic Conversion, as applicable.

 
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(f)             The Partnership shall pay any and all issue, documentary, stamp and other taxes, excluding any income, franchise, property or similar taxes, that may be payable in respect of any issue or delivery of Common Units – Class A on conversion of, or payment of distributions on, Common Units – Class B pursuant hereto. However, the holder of any Common Units – Class B shall pay any tax that is due because the Common Units – Class A issuable upon conversion thereof or distribution payment thereon are issued in a name other than such holder’s name.

ARTICLE VI
ALLOCATIONS AND DISTRIBUTIONS

6.1            Allocations for Capital Account Purposes .  For purposes of maintaining the Capital Accounts and in determining the rights of the Partners among themselves, the Partnership’s items of income, gain, loss and deduction (computed in accordance with Section 5.5(b) ) shall be allocated among the Partners in each taxable year (or portion thereof) as provided herein below.

(a)             Net Income and Net Loss .  After giving effect to the special allocations set forth in Section 6.1(d) and the allocations to the Waiver Units in Section 5.10(b)(i) , Net Income and Net Loss for each taxable period and all items of income, gain, loss and deduction taken into account in computing Net Income and Net Loss for such taxable period shall be allocated to the holders of Common Units in accordance with their Percentage Interests.

(b)            [Intentionally Deleted]

(c)            [Intentionally Deleted]

(d)             Special Allocations . Notwithstanding any other provision of this Section 6.1 , the following special allocations shall be made for such taxable period:

(i)              Partnership Minimum Gain Chargeback . Notwithstanding any other provision of this Section 6.1 , if there is a net decrease in Partnership Minimum Gain during any Partnership taxable period, each Partner shall be allocated items of Partnership income and gain for such period (and, if necessary, subsequent periods) in the manner and amounts provided in Treasury Regulation Sections 1.704-2(f)(6), 1.704-2(g)(2) and 1.704-2(j)(2)(i), or any successor provision. For purposes of this Section 6.1(d) , each Partner’s Adjusted Capital Account balance shall be determined, and the allocation of income or gain required hereunder shall be effected, prior to the application of any other allocations pursuant to this Section 6.1(d) with respect to such taxable period (other than an allocation pursuant to Sections 6.1(d)(vi) and 6.1(d)(vii) ). This Section 6.1(d)(i) is intended to comply with the Partnership Minimum Gain chargeback requirement in Treasury Regulation Section 1.704-2(f) and shall be interpreted consistently therewith.

 
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(ii)             Chargeback of Partner Nonrecourse Debt Minimum Gain . Notwithstanding the other provisions of this Section 6.1 (other than Section 6.1(d)(i) ), except as provided in Treasury Regulation Section 1.704-2(i)(4), if there is a net decrease in Partner Nonrecourse Debt Minimum Gain during any Partnership taxable period, any Partner with a share of Partner Nonrecourse Debt Minimum Gain at the beginning of such taxable period shall be allocated items of Partnership income and gain for such period (and, if necessary, subsequent periods) in the manner and amounts provided in Treasury Regulation Sections 1.704-2(i)(4) and 1.704- 2(j)(2)(ii), or any successor provisions. For purposes of this Section 6.1(d) , each Partner’s Adjusted Capital Account balance shall be determined, and the allocation of income or gain required hereunder shall be effected, prior to the application of any other allocations pursuant to this Section 6.1(d) , other than Section 6.1(d)(i) and other than an allocation pursuant to Sections 6.1(d)(v) and 6.1(d)(vi), with respect to such taxable period. This Section 6.1(d)(ii) is intended to comply with the chargeback of items of income and gain requirement in Treasury Regulation Section 1.704-2(i)(4) and shall be interpreted consistently therewith.

(iii)           [Intentionally Deleted]

(iv)            Qualified Income Offset . In the event any Partner unexpectedly receives any adjustments, allocations or distributions described in Treasury Regulation Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), or 1.704-1(b)(2)(ii)(d)(6), items of Partnership income and gain shall be specially allocated to such Partner in an amount and manner sufficient to eliminate, to the extent required by the Treasury Regulations promulgated under Section 704(b) of the Code, the deficit balance, if any, in its Adjusted Capital Account created by such adjustments, allocations or distributions as quickly as possible unless such deficit balance is otherwise eliminated pursuant to Section 6.1(d)(i) or 6.1(d)(ii) .

(v)             Gross Income Allocations . In the event any Partner has a deficit balance in its Capital Account at the end of any Partnership taxable period in excess of the sum of (A) the amount such Partner is required to restore pursuant to the provisions of this Agreement and (B) the amount such Partner is deemed obligated to restore pursuant to Treasury Regulation Sections 1.704-2(g) and 1.704-2(i)(5), such Partner shall be specially allocated items of Partnership gross income and gain in the amount of such excess as quickly as possible; provided, that an allocation pursuant to this Section 6.1(d)(v) shall be made only if and to the extent that such Partner would have a deficit balance in its Capital Account as adjusted after all other allocations provided for in this Section 6.1 have been tentatively made as if this Section 6.1(d)(v) were not in this Agreement.

 
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(vi)            Nonrecourse Deductions . Nonrecourse Deductions for any taxable period shall be allocated to the Partners in accordance with their respective Percentage Interests. If the General Partner determines in its good faith discretion that the Partnership’s Nonrecourse Deductions must be allocated in a different ratio to satisfy the safe harbor requirements of the Treasury Regulations promulgated under Section 704(b) of the Code, the General Partner is authorized, upon notice to the other Partners, to revise the prescribed ratio to the numerically closest ratio that does satisfy such requirements.

(vii)           Partner Nonrecourse Deductions . Partner Nonrecourse Deductions for any taxable period shall be allocated 100% to the Partner that bears the Economic Risk of Loss with respect to the Partner Nonrecourse Debt to which such Partner Nonrecourse Deductions are attributable in accordance with Treasury Regulation Section 1.704-2(i). If more than one Partner bears the Economic Risk of Loss with respect to a Partner Nonrecourse Debt, such Partner Nonrecourse Deductions attributable thereto shall be allocated between or among such Partners in accordance with the ratios in which they share such Economic Risk of Loss.

(viii)          Nonrecourse Liabilities . For purposes of Treasury Regulation Section 1.752-3(a)(3), the Partners agree that Nonrecourse Liabilities of the Partnership in excess of the sum of (A) the amount of Partnership Minimum Gain and (B) the total amount of Nonrecourse Built-in Gain shall be allocated among the Partners in accordance with their respective Percentage Interests.

(ix)            Code Section 754 Adjustments . To the extent an adjustment to the adjusted tax basis of any Partnership asset pursuant to Section 734(b) or 743(b) of the Code is required, pursuant to Treasury Regulation Section 1.704- 1(b)(2)(iv)(m), to be taken into account in determining Capital Accounts, the amount of such adjustment to the Capital Accounts shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis), and such item of gain or loss shall be specially allocated to the Partners in a manner consistent with the manner in which their Capital Accounts are required to be adjusted pursuant to such Section of the Treasury Regulations.

(x)             Curative Allocation .

(A)           Notwithstanding any other provision of this Section 6.1 , other than the Required Allocations, the Required Allocations shall be taken into account in making the Agreed Allocations so that, to the extent possible, the net amount of items of income, gain, loss and deduction allocated to each Partner pursuant to the Required Allocations and the Agreed Allocations, together, shall be equal to the net amount of such items that would have been allocated to each such Partner under the Agreed Allocations had the Required Allocations and the related Curative Allocation not otherwise been provided in this Section 6.1 . Notwithstanding the preceding sentence, Required Allocations relating to (1) Nonrecourse Deductions shall not be taken into account except to the extent that there has been a decrease in Partnership Minimum Gain and (2) Partner Nonrecourse Deductions shall not be taken into account except to the extent that there has been a decrease in Partner Nonrecourse Debt Minimum Gain. Allocations pursuant to this Section 6.1(d)(x)(A) shall only be made with respect to Required Allocations to the extent the General Partner reasonably determines that such allocations will otherwise be inconsistent with the economic agreement among the Partners. Further, allocations pursuant to this Section 6.1(d)(x)(A) shall be deferred with respect to allocations pursuant to clauses (1) and (2) hereof to the extent the General Partner reasonably determines that such allocations are likely to be offset by subsequent Required Allocations.

 
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(B)           The General Partner shall have reasonable discretion, with respect to each taxable period, to (1) apply the provisions of Section 6.1(d)(x)(A) in whatever order is most likely to minimize the economic distortions that might otherwise result from the Required Allocations, and (2) divide all allocations pursuant to Section 6.1(d)(x)(A) among the Partners in a manner that is likely to minimize such economic distortions.

6.2            Allocations for Tax Purposes .

(a)            Except as otherwise provided herein, for federal income tax purposes, each item of income, gain, loss and deduction shall be allocated among the Partners in the same manner as its correlative item of “book” income, gain, loss or deduction is allocated pursuant to Section 6.1 .

(b)            In an attempt to eliminate Book-Tax Disparities attributable to a Contributed Property or Adjusted Property, items of income, gain, loss, depreciation, amortization and cost recovery deductions shall be allocated for federal income tax purposes among the Partners as follows:

(i)            (A) In the case of a Contributed Property, such items attributable thereto shall be allocated among the Partners in the manner provided under Section 704(c) of the Code that takes into account the variation between the Agreed Value of such property and its adjusted basis at the time of contribution; and

(B)           any item of Residual Gain or Residual Loss attributable to a Contributed Property shall be allocated among the Partners in the same manner as its correlative item of “book” gain or loss is allocated pursuant to Section 6.1 .

(ii)            (A) In the case of an Adjusted Property, such items shall (1) first, be allocated among the Partners in a manner consistent with the principles of Section 704(c) of the Code to take into account the Unrealized Gain or Unrealized Loss attributable to such property and the allocations thereof pursuant to Section 5.5(d)(i) or 5.5(d)(ii) , and (2) second, in the event such property was originally a Contributed Property, be allocated among the Partners in a manner consistent with Section 6.2(b)(i)(A) ; and

 
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(B)           any item of Residual Gain or Residual Loss attributable to an Adjusted Property shall be allocated among the Partners in the same manner as its correlative item of “book” gain or loss is allocated pursuant to Section 6.1 .

(iii)           The General Partner shall apply the principles of Treasury Regulation Section 1.704-3(d) to eliminate Book-Tax Disparities.

(c)            For the proper administration of the Partnership and for the preservation of uniformity of the Limited Partner Interests (or any class or classes thereof), the General Partner shall have sole discretion to (i) adopt such conventions as it deems appropriate in determining the amount of depreciation, amortization and cost recovery deductions; (ii) make special allocations for federal income tax purposes of income (including gross income) or deductions; and (iii) amend the provisions of this Agreement as appropriate (x) to reflect the proposal or promulgation of Treasury Regulations under Section 704(b) or Section 704(c) of the Code or (y) otherwise to preserve or achieve uniformity of the Limited Partner Interests (or any class or classes thereof). The General Partner may adopt such conventions, make such allocations and make such amendments to this Agreement as provided in this Section 6.2(c) only if such conventions, allocations or amendments would not have a material adverse effect on the Partners, the holders of any class or classes of Limited Partner Interests issued and Outstanding or the Partnership, and if such allocations are consistent with the principles of Section 704 of the Code.

(d)            The General Partner in its discretion may determine to depreciate or amortize the portion of an adjustment under Section 743(b) of the Code attributable to unrealized appreciation in any Adjusted Property (to the extent of the unamortized Book-Tax Disparity) using a predetermined rate derived from the depreciation or amortization method and useful life applied to the Partnership’s common basis of such property, despite any inconsistency of such approach with Treasury Regulation Section 1.167(c)-l(a)(6) or any successor regulations thereto. If the General Partner determines that such reporting position cannot reasonably be taken, the General Partner may adopt depreciation and amortization conventions under which all purchasers acquiring Limited Partner Interests in the same month would receive depreciation and amortization deductions, based upon the same applicable rate as if they had purchased a direct interest in the Partnership’s property. If the General Partner chooses not to utilize such aggregate method, the General Partner may use any other reasonable depreciation and amortization conventions to preserve the uniformity of the intrinsic tax characteristics of any Limited Partner Interests, so long as such conventions would not have a material adverse effect on the Limited Partners or the Record Holders of any class or classes of Limited Partner Interests.

(e)            Any gain allocated to the Partners upon the sale or other taxable disposition of any Partnership asset shall, to the extent possible, after taking into account other required allocations of gain pursuant to this Section 6.2 , be characterized as Recapture Income in the same proportions and to the same extent as such Partners (or their predecessors in interest) have been allocated any deductions directly or indirectly giving rise to the treatment of such gains as Recapture Income.

(f)            All items of income, gain, loss, deduction and credit recognized by the Partnership for federal income tax purposes and allocated to the Partners in accordance with the provisions hereof shall be determined without regard to any election under Section 754 of the Code that may be made by the Partnership; provided , however , that such allocations, once made, shall be adjusted as necessary or appropriate to take into account those adjustments permitted or required by Sections 734 and 743 of the Code.

 
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(g)            Each item of Partnership income, gain, loss and deduction attributable to a transferred Partnership Interest, shall for federal income tax purposes, be determined on an annual basis and prorated on a monthly basis and shall be allocated to the Partners as of the opening of the New York Stock Exchange on the first Business Day of each month; provided , however , that gain or loss on a sale or other disposition of any assets of the Partnership or any other extraordinary item of income or loss realized or recognized other than in the ordinary course of business shall be allocated to the Partners as of the opening of the New York Stock Exchange on the first Business Day of the month in which such gain or loss is recognized for federal income tax purposes. The General Partner may revise, alter or otherwise modify such methods of allocation as it determines necessary, to the extent permitted or required by Section 706 of the Code and the regulations or rulings promulgated thereunder.

(h)            Allocations that would otherwise be made to a Limited Partner under the provisions of this Article VI shall instead be made to the beneficial owner of Limited Partner Interests held by a nominee in any case in which the nominee has furnished the identity of such owner to the Partnership in accordance with Section 6031(c) of the Code or any other method acceptable to the General Partner in its sole discretion.

6.3            Requirement of Distributions; Distributions to Record Holders .

(a)            Subject to Section 5.10 and after making the distributions required by Section 5.10(b)(ii) and beginning with the first Quarter ending on March 31, 2011, within 45 days following the end of each Quarter, an amount equal to 100% of Available Cash with respect to such Quarter shall, subject to Section 17-607 of the Delaware Act, be distributed in accordance with this Article VI by the Partnership to the holders of Common Units based upon their Percentage Interests as of the Record Date selected by the General Partner in accordance with each Limited Partner’s Percentage Interest; provided , however , that Common Units – Class A (i) issued upon conversion of Waiver Units, (ii) issued and Outstanding (or deemed issued and outstanding or held by a Record Holder) during such Quarter, (iii) entitled to a distribution with respect to such Quarter, and (iv) Outstanding for less than the entire Quarter, shall be entitled only to a pro rata distribution based on the number of days in such Quarter during which such Unit was (or was deemed) Outstanding.  Notwithstanding any provision to the contrary contained in this Agreement, the Partnership shall not make any distributions to any Partner on account of its interest in the Partnership if such distribution would violate the Delaware Act.  With respect to the Quarter ending on December 31, 2010, distributions shall be made as provided in this Agreement but assuming that no Waiver Units or Common Units – Class B are or were Outstanding during such Quarter or on the Record Date selected by the General Partner for such distribution, such that only the Common Units – Class A shall be entitled to any distributions for the Quarter ending December 31, 2010.

(b)            Notwithstanding Section 6.3(a) , in the event of the dissolution and liquidation of the Partnership, all receipts received during or after the Quarter in which the Liquidation Date occurs, other than from borrowings described in (a)(ii) of the definition of Available Cash, shall be applied and distributed solely in accordance with, and subject to the terms and conditions of, Section 12.4 .

 
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(c)            The General Partner shall have the discretion to treat taxes paid by the Partnership on behalf of, or amounts withheld with respect to, all or less than all of the Partners, as a distribution of Available Cash to such Partners.

(d)            Each distribution in respect of a Partnership Interest shall be paid by the Partnership, directly or through the Transfer Agent or through any other Person or agent, only to the Record Holder of such Partnership Interest as of the Record Date set for such distribution. Such payment shall constitute full payment and satisfaction of the Partnership’s liability in respect of such payment, regardless of any claim of any Person who may have an interest in such payment by reason of an assignment or otherwise.

(e)            Subject to Section 5.10 , all other distributions of cash and other property shall be made to the holders of Common Units, Pro Rata.

ARTICLE VII
MANAGEMENT AND OPERATION OF BUSINESS

7.1            Management .

(a)            The General Partner shall conduct, direct and manage all activities of the Partnership. Except as otherwise expressly provided in this Agreement, all management powers over the business and affairs of the Partnership shall be exclusively vested in the General Partner, and no Limited Partner or Assignee shall have any management power over the business and affairs of the Partnership. In addition to the powers now or hereafter granted a general partner of a limited partnership under applicable law or that are granted to the General Partner under any other provision of this Agreement, the General Partner, subject to Section 7.3 , shall have full power and authority to do all things and on such terms as it, in its sole discretion, may deem necessary or appropriate to conduct the business of the Partnership, to exercise all powers set forth in Section 2.5 and to effectuate the purposes set forth in Section 2.4 , including the following:

(i)             the making of any expenditures, the lending or borrowing of money, the assumption or guarantee of, or other contracting for, indebtedness and other liabilities, the issuance of evidences of indebtedness, including indebtedness that is convertible into Partnership Securities, and the incurring of any other obligations;

(ii)            the making of tax, regulatory and other filings, or rendering of periodic or other reports to governmental or other agencies having jurisdiction over the business or assets of the Partnership;

(iii)           the acquisition, disposition, mortgage, pledge, encumbrance, hypothecation or exchange of any or all of the assets of the Partnership or the merger or other combination of the Partnership with or into another Person (the matters described in this clause (iii) being subject, however, to any prior approval that may be required by Section 7.3 );

 
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(iv)           the use of the assets of the Partnership (including cash on hand) for any purpose consistent with the terms of this Agreement, including the financing of the conduct of the operations of the Partnership Group, subject to Section 7.6 the lending of funds to other Persons (including Genesis OLP and any Group Member), the repayment of obligations of Genesis OLP and any Group Member and the making of capital contributions to any Group Member;

(v)            the negotiation, execution and performance of any contracts, conveyances or other instruments (including instruments that limit the liability of the Partnership under contractual arrangements to all or particular assets of the Partnership, with the other party to the contract to have no recourse against the General Partner or its assets other than its interest in the Partnership, even if same results in the terms of the transaction being less favorable to the Partnership than would otherwise be the case);

(vi)           the distribution of Partnership cash;

(vii)          the selection and dismissal of employees (including employees having titles such as “president,” “vice president,” “secretary” and “treasurer”) and agents, outside attorneys, accountants, consultants and contractors and the determination of their compensation and other terms of employment or hiring;

(viii          the maintenance of such insurance for the benefit of the Partnership Group and the Partners as it deems necessary or appropriate;

(ix)            the formation of, or acquisition of an interest in, and the contribution of property and the making of loans to, any further limited or general partnerships, joint ventures, corporations or other relationships (including the acquisition of interests in, and the contributions of property to, Genesis OLP from time to time), subject, however, to the restrictions set forth in Section 2.4 ;

(x)             the control of any matters affecting the rights and obligations of the Partnership, including the bringing and defending of actions at law or in equity and otherwise engaging in the conduct of litigation and the incurring of legal expense and the settlement of claims and litigation;

(xi)            the indemnification of any Person against liabilities and contingencies to the extent permitted by law;

(xii)           the entering into of listing agreements with any National Securities Exchange and the delisting of some or all of the Limited Partner Interests from, or requesting that trading be suspended on, any such exchange (subject to any prior approval that may be required under Section 4.7 );

 
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(xiii)         the purchase, sale or other acquisition or disposition of Partnership Securities, and the issuance of additional Partnership Securities and options, rights, warrants and appreciation rights relating to Partnership Securities; and

(xiv)         the undertaking of any action in connection with the Partnership’s participation as a partner of Genesis OLP.

(b)            Notwithstanding any other provision of this Agreement, the Fourth Amended OLP Agreement, the Delaware Act or any applicable law, rule or regulation, each of the Partners and each other Person who may acquire an interest in the Partnership hereby (i) approves, ratifies and confirms the execution, delivery and performance by the parties thereto of this Agreement, the First Amended OLP Agreement and the other agreements described in or filed as part of the Proxy Statement; (ii) agrees that the General Partner (on its own or through any officer of the Partnership) is authorized to execute, deliver and perform the agreements referred to in clause (i) of this sentence and the other agreements, acts, transactions and matters described in or contemplated by the Proxy Statement on behalf of the Partnership without any further act, approval or vote of the Partners or the other Persons who may acquire an interest in the Partnership; and (iii) agrees that the execution, delivery or performance by the General Partner, any Group Member or any Affiliate of any of them, of this Agreement or any agreement authorized or permitted under this Agreement (including the exercise by the General Partner or any Affiliate of the General Partner of the rights accorded pursuant to Article XV ), shall not constitute a breach by the General Partner of any duty that the General Partner may owe the Partnership or the Limited Partners or any other Persons under this Agreement (or any other agreements) or of any duty stated or implied by law or equity.

7.2            Certificate of Limited Partnership .  The General Partner has caused the Certificate of Amended and Restated Limited Partnership to be filed with the Secretary of State of the State of Delaware as required by the Delaware Act and shall use all reasonable efforts to cause to be filed such other certificates or documents as may be determined by the General Partner in its sole discretion to be reasonable and necessary or appropriate for the formation, continuation, qualification and operation of a limited partnership (or a partnership in which the limited partners have limited liability) in the State of Delaware or any other state in which the Partnership may elect to do business or own property. To the extent that such action is determined by the General Partner in its sole discretion to be reasonable and necessary or appropriate, the General Partner shall file amendments to and restatements of the Certificate of Limited Partnership and do all things to maintain the Partnership as a limited partnership (or a partnership or other entity in which the limited partners have limited liability) under the laws of the State of Delaware or of any other state in which the Partnership may elect to do business or own property. Subject to the terms of Section 3.4(a), the General Partner shall not be required, before or after filing, to deliver or mail a copy of the Certificate of Limited Partnership, any qualification document or any amendment thereto to any Limited Partner or Assignee.

7.3            Restrictions on General Partner’s Authority .

(a)            The General Partner may not, without written approval of the specific act by holders of all of the Outstanding Limited Partner Interests or by other written instrument executed and delivered by holders of all of the Outstanding Limited Partner Interests subsequent to the date of this Agreement, take any action in contravention of this Agreement, including, except as otherwise provided in this Agreement (i) committing any act that would make it impossible to carry on the ordinary business of the Partnership; (ii) possessing Partnership property, or assigning any rights in specific Partnership property, for other than a Partnership purpose; (iii) admitting a Person as a Partner; (iv) amending this Agreement in any manner; or (v) transferring its General Partner Interest.

 
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(b)            Except as provided in Article XII and Article XIV , the General Partner may not sell, exchange or otherwise dispose of all or substantially all of the assets of the Partnership Group in a single transaction or a series of related transactions (including by way of merger, consolidation or other combination) or approve on behalf of the Partnership the sale, exchange or other disposition of all or substantially all of the assets of the Partnership, without the approval of holders of a Majority Interest; provided , however , that this provision shall not preclude or limit the General Partner’s ability to mortgage, pledge, hypothecate or grant a security interest in all or substantially all of the assets of the Partnership Group and shall not apply to any forced sale of any or all of the assets of the Partnership Group pursuant to the foreclosure of, or other realization upon, any such encumbrance; and provided, further, that this provision shall not preclude or limit the ability of Genesis OLP to sell, exchange or otherwise dispose of all of the assets of Genesis OLP in a single transaction or a series of related transactions that is approved by the limited partners of Genesis OLP as provided in Section 7.3(b) of the Fourth Amended OLP Agreement.

(c)            Without the approval of holders of a Majority Interest, the General Partner shall not, on behalf of the Partnership, (i) consent to any amendment to the Fourth Amended OLP Agreement or, except as expressly permitted by Section 7.9(d) , take any action permitted to be taken by a partner of Genesis OLP, in either case, that would have a material adverse effect on the Partnership as a partner of Genesis OLP or (ii) except as permitted under Sections 4.6 , 11.1 and 11.2 , elect or cause the Partnership to elect a successor general partner of Genesis OLP.

7.4            Reimbursement of the General Partner .

(a)            Except as provided in this Section 7.4 and elsewhere in this Agreement or in the Fourth Amended OLP Agreement, the General Partner shall not be compensated for its services as general partner of any Group Member.

(b)            The General Partner shall be reimbursed on a monthly basis, or such other reasonable basis as the General Partner may determine in its sole discretion, for (i) all direct and indirect expenses it incurs or payments it makes on behalf of the Partnership (including salary, bonus, incentive compensation and other amounts paid to any Person, including Affiliates of the General Partner, to perform services for the Partnership or for the General Partner in the discharge of its duties to the Partnership), and (ii) all other necessary or appropriate expenses allocable to the Partnership or otherwise reasonably incurred by the General Partner in connection with operating the Partnership’s business (including expenses allocated to the General Partner by its Affiliates). The General Partner shall determine the expenses that are allocable to the Partnership in any reasonable manner determined by the General Partner in its sole discretion. Reimbursements pursuant to this Section 7.4 shall be in addition to any reimbursement to the General Partner as a result of indemnification pursuant to Section 7.7 .

 
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(c)            The General Partner, in its sole discretion and without the approval of the Limited Partners (who shall have no right to vote in respect thereof), may propose and adopt on behalf of the Partnership employee benefit plans, employee programs and employee practices (including plans, programs and practices involving the issuance of Partnership Securities or options to purchase Partnership Securities), or cause the Partnership to issue Partnership Securities pursuant to any employee benefit plan, employee program or employee practice maintained or sponsored by the General Partner or any of its Affiliates, in each case for the benefit of employees of the General Partner, any Group Member or any Affiliate, or any of them, in respect of services performed, directly or indirectly, for the benefit of the Partnership Group. The Partnership agrees to issue and sell to the General Partner or any of its Affiliates any Partnership Securities that the General Partner or such Affiliate is obligated to provide to any employees pursuant to any such employee benefit plans, employee programs or employee practices. Expenses incurred by the General Partner in connection with any such plans, programs and practices (including the net cost to the General Partner or such Affiliate of Partnership Securities purchased by the General Partner or such Affiliate from the Partnership to fulfill options or awards under such plans, programs and practices) shall be reimbursed in accordance with Section 7.4(b) . Any and all obligations of the General Partner under any employee benefit plans, employee programs or employee practices adopted by the General Partner as permitted by this Section 7.4(c) shall constitute obligations of the General Partner hereunder and shall be assumed by any successor General Partner approved pursuant to Section 11.1 or 11.2 or the transferee of or successor to all of the General Partner’s General Partner Interest pursuant to Section 4.6 .

7.5            Outside Activities .

(a)            The General Partner, for so long as it is the general partner of the Partnership (i) agrees that its sole business will be to act as a general partner or managing member, as the case may be, of the Partnership, Genesis OLP and any other partnership or limited liability company of which the Partnership or Genesis OLP is, directly or indirectly, a partner or member and to undertake activities that are ancillary or related thereto (including being a limited partner or member in the Partnership or any such other partnership or limited liability company) and (ii) shall not, directly or indirectly, engage in any business or activity or incur any debts or liabilities except in connection with or incidental to (A) its performance as general partner or managing member, as the case may be, of one or more Group Members or as  described in or contemplated by the Registration Statement or the Proxy Statement or (B) the acquiring, owning or disposing of debt or equity securities of any Group Member.

(b)            Salomon, Basis Petroleum, Inc. and Howell continue to be parties to the Non-Competition Agreement, which agreement sets forth certain restrictions on their ability to engage in the business of (i)  crude oil gathering at the wellhead in the states of Alabama, Florida, Kansas, Louisiana, Mississippi, New Mexico, Oklahoma or Texas, or any states contiguous to such states, and (ii) transporting for third parties crude oil by pipeline along the routes of the Partnership’s crude oil pipelines owned as of the Initial Closing Date. The Non-Competition Agreement remains in effect in accordance with its terms.

(c)            Except as specifically restricted by Section 7.5(a) and the Non-Competition Agreement, each Indemnitee (other than the General Partner) shall have the right to engage in businesses of every type and description and other activities for profit and to engage in and possess an interest in other business ventures of any and every type or description, whether in businesses engaged in or anticipated to be engaged in by any Group Member, independently or with others, including business interests and activities in direct competition with the business and activities of any Group Member, and none of the same shall constitute a breach of this Agreement or any duty expressed or implied by law to any Group Member or any Partner. Neither any Group Member, nor any Limited Partner nor any other Person shall have any rights by virtue of this Agreement, the Fourth Amended OLP Agreement or the partnership relationship established hereby or thereby in any business ventures of any Indemnitee.

 
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(d)            Subject to the terms of Sections 7.5(a) , 7.5(b) and 7.5(c) and the Non-Competition Agreement, but otherwise notwithstanding anything to the contrary in this Agreement, (i) the engaging in competitive activities by any Indemnitees (other than the General Partner) in accordance with the provisions of this Section 7.5 is hereby approved by the Partnership and all Partners and (ii) it shall be deemed not to be a breach of the General Partner’s fiduciary duty or any other obligation of any type whatsoever of the General Partner for the Indemnitees (other than the General Partner) to engage in such business interests and activities in preference to or to the exclusion of the Partnership, and the General Partner and the Indemnitees shall have no obligation to present business opportunities to the Partnership.

(e)            The General Partner and any of its Affiliates may acquire Partnership Securities in addition to those heretofore acquired and, except as otherwise provided in this Agreement, shall be entitled to exercise all rights relating to such Partnership Securities.

(f)            The term “Affiliates” when used in Section 7.5 with respect to the General Partner shall not include any Group Member or any Subsidiary of the Group Member.

7.6            Loans from the General Partner; Loans or Contributions from the Partnership; Contracts with Affiliates; Certain Restrictions on the General Partner .

(a)            The General Partner or any Affiliate thereof may lend to any Group Member, and any Group Member may borrow from the General Partner or any of its Affiliates, funds needed or desired by the Group Member for such periods of time and in such amounts as the General Partner may determine; provided , however , that in any such case the lending party may not charge the borrowing party interest at a rate greater than the rate that would be charged the borrowing party or impose terms less favorable to the borrowing party than would be charged or imposed on the borrowing party by unrelated lenders on comparable loans made on an arm’s-length basis (without reference to the lending party’s financial abilities or guarantees). The borrowing party shall reimburse the lending party for any costs (other than any additional interest costs) incurred by the lending party in connection with the borrowing of such funds. For purposes of this Section 7.6(a) and Section 7.6(b) , the term “Group Member” shall include any Affiliate of a Group Member that is controlled by the Group Member. No Group Member may lend funds to the General Partner or any of its Affiliates (other than another Group Member).

(b)            The Partnership may lend or contribute to any Group Member, and any Group Member may borrow from the Partnership, funds on terms and conditions established in the sole discretion of the General Partner; provided , however , that the Partnership may not charge the Group Member interest at a rate less than the rate that would be charged to the Group Member (without reference to the General Partner’s financial abilities or guarantees) by unrelated lenders on comparable loans. The foregoing authority shall be exercised by the General Partner in its sole discretion and shall not create any right or benefit in favor of any Group Member or any other Person.

 
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(c)            The General Partner may itself, or may enter into an agreement with any of its Affiliates to, render services to a Group Member or to the General Partner in the discharge of its duties as general partner of the Partnership. Any services rendered to a Group Member by the General Partner or any of its Affiliates shall be on terms that are fair and reasonable to the Partnership; provided , however , that the requirements of this Section 7.6(c) shall be deemed satisfied as to (i) any transaction approved by Special Approval, (ii) any transaction, the terms of which are no less favorable to the Partnership Group than those generally being provided to or available from unrelated third parties or (iii) any transaction that, taking into account the totality of the relationships between the parties involved (including other transactions that may be particularly favorable or advantageous to the Partnership Group), is equitable to the Partnership Group. The provisions of Section 7.4 shall apply to the rendering of services described in this Section 7.6(c) .

(d)            The Partnership Group may transfer assets to joint ventures, other partnerships, corporations, limited liability companies or other business entities in which it is or thereby becomes a participant upon such terms and subject to such conditions as are consistent with this Agreement and applicable law.

(e)            Neither the General Partner nor any of its Affiliates shall sell, transfer or convey any property to, or purchase any property from the Partnership, directly or indirectly, except pursuant to transactions that are fair and reasonable to the Partnership; provided , however , that the requirements of this Section 7.6(e) shall be deemed to be satisfied as to (i) the transactions effected pursuant to Sections 5.2 and 5.3 of the First Amended Agreement, the Conveyance Agreement and any other transactions described in or contemplated by the Registration Statement or the Proxy Statement, (ii) any transaction approved by Special Approval, (iii) any transaction, the terms of which are no less favorable to the Partnership than those generally being provided to or available from unrelated third parties, or (iv) any transaction that, taking into account the totality of the relationships between the parties involved (including other transactions that may be particularly favorable or advantageous to the Partnership), is equitable to the Partnership. With respect to any contribution of assets to the Partnership in exchange for Partnership Securities, the Conflicts Committee, in determining whether the appropriate number of Partnership Securities are being issued, may take into account, among other things, the fair market value of the assets, the liquidated and contingent liabilities assumed, the tax basis in the assets, the extent to which tax-only allocations to the transferor will protect the existing partners of the Partnership against a low tax basis, and such other factors as the Conflicts Committee deems relevant under the circumstances.

(f)             The General Partner and its Affiliates will have no obligation to permit any Group Member to use any facilities or assets of the General Partner and its Affiliates, except as may be provided in contracts entered into from time to time specifically dealing with such use, nor shall there be any obligation on the part of the General Partner or its Affiliates to enter into such contracts.

 
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(g)            Without limitation of Sections 7.6(a) through 7.6(f) , and notwithstanding anything to the contrary in this Agreement, the existence of the conflicts of interest described in the Registration Statement or the Proxy Statement are hereby approved by all Partners.

7.7            Indemnification .

(a)            To the fullest extent permitted by law but subject to the limitations expressly provided in this Agreement, all Indemnitees shall be indemnified and held harmless by the Partnership from and against any and all losses, claims, damages, liabilities, joint or several, expenses (including legal fees and expenses), judgments, fines, penalties, interest, settlements or other amounts arising from any and all claims, demands, actions, suits or proceedings, whether civil, criminal, administrative or investigative, in which any Indemnitee may be involved, or is threatened to be involved, as a party or otherwise, by reason of its status as an Indemnitee; provided, that in each case the Indemnitee acted in good faith and in a manner that such Indemnitee reasonably believed to be in, or not opposed to, the best interests of the Partnership and, with respect to any criminal proceeding, had no reasonable cause to believe its conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction or upon a plea of nolo contendere, or its equivalent, shall not create a presumption that the Indemnitee acted in a manner contrary to that specified above. Any indemnification pursuant to this Section 7.7 shall be made only out of the assets of the Partnership, it being agreed that the General Partner shall not be personally liable for such indemnification and shall have no obligation to contribute or loan any monies or property to the Partnership to enable it to effectuate such indemnification.

(b)            To the fullest extent permitted by law, expenses (including legal fees and expenses) incurred by an Indemnitee who is indemnified pursuant to Section 7.7(a) in defending any claim, demand, action, suit or proceeding shall, from time to time, be advanced by the Partnership prior to the final disposition of such claim, demand, action, suit or proceeding upon receipt by the Partnership of any undertaking by or on behalf of the Indemnitee to repay such amount if it shall be determined that the Indemnitee is not entitled to be indemnified as authorized in this Section 7.7 .

(c)            The indemnification provided by this Section 7.7 shall be in addition to any other rights to which an Indemnitee may be entitled under any agreement, pursuant to any vote of the holders of Outstanding Limited Partner Interests, as a matter of law or otherwise, both as to actions in the Indemnitee’s capacity as an Indemnitee and as to actions in any other capacity (including any capacity under the Underwriting Agreement dated November 26, 1996 among the Partnership, Genesis OLP, and the underwriters and other parties named therein), and shall continue as to an Indemnitee who has ceased to serve in such capacity and shall inure to the benefit of the heirs, successors, assigns and administrators of the Indemnitee.

(d)            The Partnership may purchase and maintain (or reimburse the General Partner or its Affiliates for the cost of) insurance, on behalf of the General Partner, its Affiliates and such other Persons as the General Partner shall determine, against any liability that may be asserted against or expense that may be incurred by such Person in connection with the Partnership’s activities or such Person’s activities on behalf of the Partnership, regardless of whether the Partnership would have the power to indemnify such Person against such liability under the provisions of this Agreement.

 
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(e)            For purposes of this Section 7.7 , the Partnership shall be deemed to have requested an Indemnitee to serve as fiduciary of an employee benefit plan whenever the performance by it of its duties to the Partnership also imposes duties on, or otherwise involves services by, it to the plan or participants or beneficiaries of the plan; excise taxes assessed on an Indemnitee with respect to an employee benefit plan pursuant to applicable law shall constitute “fines” within the meaning of Section 7.7(a) ; and action taken or omitted by it with respect to any employee benefit plan in the performance of its duties for a purpose reasonably believed by it to be in the interest of the participants and beneficiaries of the plan shall be deemed to be for a purpose that is in, or not opposed to, the best interests of the Partnership.

(f)            In no event may an Indemnitee subject the Limited Partners to personal liability by reason of the indemnification provisions set forth in this Agreement.

(g)            An Indemnitee shall not be denied indemnification in whole or in part under this Section 7.7 because the Indemnitee had an interest in the transaction with respect to which the indemnification applies if the transaction was otherwise permitted by the terms of this Agreement.

(h)            The provisions of this Section 7.7 are for the benefit of the Indemnitees, their heirs, successors, assigns and administrators and shall not be deemed to create any rights for the benefit of any other Persons.

(i)            No amendment, modification or repeal of this Section 7.7 or any provision hereof shall in any manner terminate, reduce or impair the right of any past, present or future Indemnitee to be indemnified by the Partnership, nor the obligations of the Partnership to indemnify any such Indemnitee under and in accordance with the provisions of this Section 7.7 as in effect immediately prior to such amendment, modification or repeal with respect to claims arising from or relating to matters occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of when such claims may arise or be asserted.

7.8            Liability of Indemnitees .

(a)            Notwithstanding anything to the contrary set forth in this Agreement, no Indemnitee shall be liable for monetary damages to the Partnership, the Limited Partners, the Assignees or any other Persons who have acquired interests in Partnership Securities, for losses sustained or liabilities incurred as a result of any act or omission if such Indemnitee acted in good faith.

(b)            Subject to its obligations and duties as General Partner set forth in Section 7.1(a) , the General Partner may exercise any of the powers granted to it by this Agreement and perform any of the duties imposed upon it hereunder either directly or by or through its agents, and the General Partner shall not be responsible for any misconduct or negligence on the part of any such agent appointed by the General Partner in good faith.

 
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(c)            To the extent that, at law or in equity, an Indemnitee has duties (including fiduciary duties) and liabilities relating thereto to the Partnership or to the Partners, the General Partner and any other Indemnitee acting in connection with the Partnership’s business or affairs shall not be liable to the Partnership or to any Partner for its good faith reliance on the provisions of this Agreement. The provisions of this Agreement, to the extent that they restrict or otherwise modify the duties and liabilities of an Indemnitee otherwise existing at law or in equity, are agreed by the Partners to replace such other duties and liabilities of such Indemnitee.

(d)            Any amendment, modification or repeal of this Section 7.8 or any provision hereof shall be prospective only and shall not in any way affect the limitations on the liability of the Indemnitees under this Section 7.8 as in effect immediately prior to such amendment, modification or repeal with respect to claims arising from or relating to matters occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of when such claims may arise or be asserted.

7.9            Resolution of Conflicts of Interest .

(a)            Unless otherwise expressly provided in this Agreement or the Fourth Amended OLP Agreement, whenever a potential conflict of interest exists or arises between the General Partner or any of its Affiliates, on the one hand, and the Partnership, Genesis OLP, any Partner, or any Assignee on the other, any resolution or course of action by the General Partner or its Affiliates in respect of such conflict of interest shall be permitted and deemed approved by all Partners, and shall not constitute a breach of this Agreement, of the Fourth Amended OLP Agreement, of any agreement contemplated herein, or of any duty stated or implied by law or equity, if the resolution or course of action is, or by operation of this Agreement is deemed to be, fair and reasonable to the Partnership. The General Partner shall be authorized but not required in connection with its resolution of such conflict of interest to seek Special Approval of such resolution. Any conflict of interest and any resolution of such conflict of interest shall be conclusively deemed fair and reasonable to the Partnership if such conflict of interest or resolution is (i) approved by Special Approval (as long as the material facts known to the General Partner or any of its Affiliates regarding any proposed transaction were disclosed to the Conflicts Committee at the time it gave its approval), (ii) on terms no less favorable to the Partnership than those generally being provided to or available from unrelated third parties or (iii) fair to the Partnership, taking into account the totality of the relationships between the parties involved (including other transactions that may be particularly favorable or advantageous to the Partnership). The General Partner may also adopt a resolution or course of action that has not received Special Approval. The General Partner (including the Conflicts Committee in connection with Special Approval) shall be authorized in connection with its determination of what is “fair and reasonable” to the Partnership and in connection with its resolution of any conflict of interest to consider (A) the relative interests of any party to such conflict, agreement, transaction or situation and the benefits and burdens relating to such interest; (B) any customary or accepted industry practices and any customary or historical dealings with a particular Person; (C) any applicable generally accepted accounting practices or principles; and (D) such additional factors as the General Partner (including the Conflicts Committee) determines in its sole discretion to be relevant, reasonable or appropriate under the circumstances. Nothing contained in this Agreement, however, is intended to nor shall it be construed to require the General Partner (including the Conflicts Committee) to consider the interests of any Person other than the Partnership. In the absence of bad faith by the General Partner, the resolution, action or terms so made, taken or provided by the General Partner with respect to such matter shall not constitute a breach of this Agreement or any other agreement contemplated herein or a breach of any standard of care or duty imposed herein or therein or, to the extent permitted by law, under the Delaware Act or any other law, rule or regulation.

 
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(b)            Whenever this Agreement or any other agreement contemplated hereby provides that the General Partner or any of its Affiliates is permitted or required to make a decision (i) in its “sole discretion” or “discretion,” that it deems “necessary or appropriate” or “necessary or advisable” or under a grant of similar authority or latitude, except as otherwise provided herein, the General Partner or such Affiliate shall be entitled to consider only such interests and factors as it desires and shall have no duty or obligation to give any consideration to any interest of, or factors affecting, the Partnership, Genesis OLP, any Limited Partner or any Assignee, (ii) it may make such decision in its sole discretion (regardless of whether there is a reference to “sole discretion” or “discretion”) unless another express standard is provided for, or (iii) in “good faith” or under another express standard, the General Partner or such Affiliate shall act under such express standard and shall not be subject to any other or different standards imposed by this Agreement, the Fourth Amended OLP Agreement, any other agreement contemplated hereby or under the Delaware Act or any other law, rule or regulation. In addition, any actions taken by the General Partner or such Affiliate consistent with the standards of “reasonable discretion” set forth in the definition of Available Cash shall not constitute a breach of any duty of the General Partner to the Partnership or the Limited Partners. The General Partner shall have no duty, express or implied, to sell or otherwise dispose of any asset of the Partnership Group other than in the ordinary course of business. No borrowing by any Group Member or the approval thereof by the General Partner shall be deemed to constitute a breach of any duty of the General Partner to the Partnership or the Limited Partners or the Assignees by reason of the fact that the purpose or effect of such borrowing is directly or indirectly to enable distributions to the General Partner or its Affiliates (including in their capacities as Limited Partners) to exceed the General Partner’s Percentage Interest of the total amount distributed to all Partners.

(c)            Whenever a particular transaction, arrangement or resolution of a conflict of interest is required under this Agreement to be “fair and reasonable” to any Person, the fair and reasonable nature of such transaction, arrangement or resolution shall be considered in the context of all similar or related transactions.

(d)            The Limited Partners hereby authorize the General Partner, on behalf of the Partnership as a partner of a Group Member, to approve of actions by the general partner of such Group Member similar to those actions permitted to be taken by the General Partner pursuant to this Section 7.9 .

7.10          Other Matters Concerning the General Partner .

(a)            The General Partner may rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, bond, debenture or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties.

 
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(b)            The General Partner may consult with legal counsel, accountants, appraisers, management consultants, investment bankers and other consultants and advisers selected by it, and any act taken or omitted to be taken in reliance upon the opinion (including an Opinion of Counsel) of such Persons as to matters that the General Partner reasonably believes to be within such Person’s professional or expert competence shall be conclusively presumed to have been done or omitted in good faith and in accordance with such opinion.

(c)            The General Partner shall have the right, in respect of any of its powers or obligations hereunder, to act through any of its duly authorized officers, a duly appointed attorney or attorneys-in-fact or the duly authorized officers of the Partnership.

(d)            Any standard of care and duty imposed by this Agreement or under the Delaware Act or any applicable law, rule or regulation shall be modified, waived or limited, to the extent permitted by law, as required to permit the General Partner to act under this Agreement or any other agreement contemplated by this Agreement and to make any decision pursuant to the authority prescribed in this Agreement, so long as such action is reasonably believed by the General Partner to be in, or not inconsistent with, the best interests of the Partnership.

7.11          Purchase or Sale of Partnership Securities .  The General Partner may cause the Partnership to purchase or otherwise acquire Partnership Securities. As long as Partnership Securities are held by any Group Member, such Partnership Securities shall not be considered Outstanding for any purpose, except as otherwise provided herein. The General Partner and any Affiliate of the General Partner may also purchase or otherwise acquire and sell or otherwise dispose of Partnership Securities for its own account, subject to the provisions of Article IV and Article X .

7.12          Reliance by Third Parties .  Notwithstanding anything to the contrary in this Agreement, any Person dealing with the Partnership shall be entitled to assume that the General Partner and any officer of the General Partner authorized by the General Partner to act on behalf of and in the name of the Partnership has full power and authority to encumber, sell or otherwise use in any manner any and all assets of the Partnership and to enter into any authorized contracts on behalf of the Partnership, and such Person shall be entitled to deal with the General Partner or any such officer as if it were the Partnership’s sole party in interest, both legally and beneficially. Each Limited Partner hereby waives any and all defenses or other remedies that may be available against such Person to contest, negate or disaffirm any action of the General Partner or any such officer in connection with any such dealing. In no event shall any Person dealing with the General Partner or any such officer or its representatives be obligated to ascertain that the terms of this Agreement have been complied with or to inquire into the necessity or expedience of any act or action of the General Partner or any such officer or its representatives. Each and every certificate, document or other instrument executed on behalf of the Partnership by the General Partner or its representatives shall be conclusive evidence in favor of any and every Person relying thereon or claiming thereunder that (a) at the time of the execution and delivery of such certificate, document or instrument, this Agreement was in full force and effect, (b) the Person executing and delivering such certificate, document or instrument was duly authorized and empowered to do so for and on behalf of the Partnership and (c) such certificate, document or instrument was duly executed and delivered in accordance with the terms and provisions of this Agreement and is binding upon the Partnership.

 
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ARTICLE VIII
BOOKS, RECORDS, ACCOUNTING AND REPORTS

8.1            Records and Accounting .  The General Partner shall keep or cause to be kept at the principal office of the Partnership, appropriate books and records with respect to the Partnership’s business, including all books and records necessary to provide to the Limited Partners any information required to be provided pursuant to Section 3.4(a) . Any books and records maintained by or on behalf of the Partnership in the regular course of its business, including the record of the Record Holders and Assignees of Units or other Partnership Securities, books of account and records of Partnership proceedings, may be kept on, or be in the form of, computer disks, hard drives, punch cards, magnetic tape, photographs, micrographics or any other information storage device; provided, that the books and records so maintained are convertible into clearly legible written form within a reasonable period of time. The books of the Partnership shall be maintained, for financial reporting purposes, on an accrual basis in accordance with U.S. GAAP.

8.2            Fiscal Year .  The fiscal year of the Partnership shall be the calendar year.

8.3            Reports .

(a)            As soon as practicable, but in no event later than 120 days after the close of each fiscal year of the Partnership, the General Partner shall cause to be mailed or furnished to each Record Holder of a Limited Partner Interest as of a date selected by the General Partner in its discretion, an annual report containing financial statements of the Partnership for such fiscal year of the Partnership, presented in accordance with U.S. GAAP, including a balance sheet and statements of operations, Partnership equity and cash flows, such statements to be audited by a firm of independent public accountants selected by the General Partner.

(b)            As soon as practicable, but in no event later than 90 days after the close of each Quarter except the last Quarter of each year, the General Partner shall cause to be mailed or furnished to each Record Holder of a Limited Partner Interest, as of a date selected by the General Partner in its discretion, a report containing unaudited financial statements of the Partnership and such other information as may be required by applicable law, regulation or rule of any National Securities Exchange on which Limited Partner Interests are listed for trading, or as the General Partner determines to be necessary or appropriate.

ARTICLE IX
TAX MATTERS

9.1            Tax Returns and Information .  The Partnership shall timely file all returns of the Partnership that are required for federal, state and local income tax purposes on the basis of the accrual method and a taxable year ending on December 31. The tax information reasonably required by Record Holders for federal and state income tax reporting purposes with respect to a taxable year shall be furnished to them within 90 days of the close of the calendar year in which the Partnership’s taxable year ends. The classification, realization and recognition of income, gain, losses and deductions and other items shall be on the accrual method of accounting for federal income tax purposes.

 
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9.2            Tax Elections .

(a)            The Partnership has made the election under Section 754 of the Code in accordance with applicable regulations thereunder, subject to the reservation of the right to seek to revoke any such election upon the General Partner’s determination that such revocation is in the best interests of the Limited Partners. Notwithstanding any other provision herein contained, for the purposes of computing the adjustments under Section 743(b) of the Code, the General Partner shall be authorized (but not required) to adopt a convention whereby the price paid by a transferee of a Limited Partner Interest will be deemed to be the lowest quoted closing price of such Limited Partner Interests on any National Securities Exchange on which such Limited Partner Interests are traded during the calendar month in which such transfer is deemed to occur pursuant to Section 6.2(g) without regard to the actual price paid by such transferee.

(b)            The Partnership has elected to deduct expenses incurred in organizing the Partnership ratably over a sixty-month period as provided in Section 709 of the Code.

(c)            Except as otherwise provided herein, the General Partner shall determine whether the Partnership should make any other elections permitted by the Code.

9.3            Tax Controversies .  Subject to the provisions hereof, the Board of Directors shall designate one officer of the Partnership or the General Partner who is a Partner as the Tax Matters Partner (as defined in the Code) and such Tax Matters Partner is authorized and required to represent the Partnership (at the Partnership’s expense) in connection with all examinations of the Partnership’s affairs by tax authorities, including resulting administrative and judicial proceedings, and to expend Partnership funds for professional services and costs associated therewith. Each Partner agrees to cooperate with the General Partner and to do or refrain from doing any or all things reasonably required by the General Partner to conduct such proceedings.

9.4            Withholding .  Notwithstanding any other provision of this Agreement, the General Partner is authorized to take any action that it determines in its discretion to be necessary or appropriate to cause the Partnership to comply with any withholding requirements established under the Code or any other federal, state or local law including pursuant to Sections 1441, 1442, 1445 and 1446 of the Code. To the extent that the Partnership is required or elects to withhold and pay over to any taxing authority any amount resulting from the allocation or distribution of income to any Partner or Assignee (including by reason of Section 1446 of the Code), the amount withheld may at the discretion of the General Partner be treated by the Partnership as a distribution of cash pursuant to Section 6.3 in the amount of such withholding from such Partner.

ARTICLE X
ADMISSION OF PARTNERS

10.1          Admission of Substituted Limited Partner .  By transfer of a Limited Partner Interest in accordance with Article IV , the transferor shall be deemed to have given the transferee the right to seek admission as a Substituted Limited Partner subject to the conditions of, and in the manner permitted under, this Agreement. A transferor of a Certificate representing a Limited Partner Interest (including uncertificated Common Units – Class A) shall, however, only have the authority to convey to a purchaser or other transferee who does not execute and deliver a Transfer Application (a) if the Limited Partner Interest is certificated, the right to negotiate such Certificate and the right to transfer the right to request admission as a Substituted Limited Partner in respect of the transferred Limited Partner Interests and (b) in the event the Limited Partner Interest is uncertificated Common Units – Class A, the right to transfer the right to request admission as a Substituted Limited Partner in respect of the transferred Limited Partner Interests. Each transferee of a Limited Partner Interest (including any nominee holder or an agent acquiring such Limited Partner Interest for the account of another Person) who executes and delivers a Transfer Application shall, by virtue of such execution and delivery, be an Assignee and be deemed to have applied to become a Substituted Limited Partner with respect to the Limited Partner Interest so transferred to such Person. Such Assignee shall become a Substituted Limited Partner (x) at such time as the General Partner consents thereto, which consent may be given or withheld in the General Partner’s discretion, and (y) when any such admission is shown on the books and records of the Partnership. If such consent is withheld, such transferee shall be an Assignee. An Assignee shall have an interest in the Partnership equivalent to that of a Limited Partner with respect to allocations and distributions, including liquidating distributions, of the Partnership. With respect to voting rights attributable to Limited Partner Interests that are held by Assignees, the General Partner shall be deemed to be the Limited Partner with respect thereto and shall, in exercising the voting rights in respect of such Limited Partner Interests on any matter, vote such Limited Partner Interests at the written direction of the Assignee who is the Record Holder of such Limited Partner Interests. If no such written direction is received, such Limited Partner Interests will not be voted. An Assignee shall have no other rights of a Limited Partner.

 
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10.2          Admission of Successor General Partner .  A successor General Partner approved pursuant to Section 11.1 or 11.2 or the transferee of or successor to all of the General Partner Interest pursuant to Section 4.6 who is proposed to be admitted as a successor General Partner shall be admitted to the Partnership as the General Partner, effective immediately prior to the withdrawal or removal of the General Partner pursuant to Section 11.1 or 11.2 or the transfer of the General Partner Interest pursuant to Section 4.6 ; provided , however , that no such successor shall be admitted to the Partnership until compliance with the terms of Section 4.6 has occurred and such successor has executed and delivered such other documents or instruments as may be required to effect such admission. Any such successor shall, subject to the terms hereof, carry on the business of the Group Members without dissolution.

10.3          Admission of Additional Limited Partners .

(a)            A Person (other than a Substituted Limited Partner) who makes a Capital Contribution to the Partnership in accordance with this Agreement in exchange for Limited Partner Interests shall be admitted to the Partnership as an Additional Limited Partner only upon furnishing to the General Partner (i) evidence of acceptance in form satisfactory to the General Partner of all of the terms and conditions of this Agreement, including the power of attorney granted in Section 2.6 , and (ii) such other documents or instruments as may be required in the discretion of the General Partner to effect such Person’s admission as an Additional Limited Partner.

 
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(b)            Notwithstanding anything to the contrary in this Section 10.3 , no Person shall be admitted as an Additional Limited Partner without the consent of the General Partner, which consent may be given or withheld in the General Partner’s discretion. The admission of any Person as an Additional Limited Partner shall become effective on the date upon which the name of such Person is recorded as such in the books and records of the Partnership, following the consent of the General Partner to such admission.

10.4          Amendment of Agreement and Certificate of Limited Partnership .  To effect the admission to the Partnership of any Partner, the General Partner shall take all steps necessary and appropriate under the Delaware Act to amend the records of the Partnership to reflect such admission and, if necessary, to prepare as soon as practicable an amendment to this Agreement and, if required by law, the General Partner shall prepare and file an amendment to the Certificate of Limited Partnership, and the General Partner may for this purpose, among others, exercise the power of attorney granted pursuant to Section 2.6 .

ARTICLE XI
WITHDRAWAL OR REMOVAL OF PARTNERS

11.1          Withdrawal of the General Partner .

(a)            The General Partner shall be deemed to have withdrawn from the Partnership upon the occurrence of any one of the following events (each such event herein referred to as an “ Event of Withdrawal ”);

(i)             the General Partner voluntarily withdraws from the Partnership by giving written notice to the Limited Partners (and it shall be deemed that the General Partner has withdrawn pursuant to this Section 11.1(a)(i) if the General Partner voluntarily withdraws as a general partner of Genesis OLP);

(ii)            the General Partner transfers all of its General Partner Interest pursuant to Section 4.6 ;

(iii)           the General Partner is removed pursuant to Section 11.2 ;

(iv)           the General Partner (A) makes a general assignment for the benefit of creditors; (B) files a voluntary bankruptcy petition for relief under Chapter 7 of the United States Bankruptcy Code; (C) files a petition or answer seeking for itself a liquidation, dissolution or similar relief (but not a reorganization) under any law; (D) files an answer or other pleading admitting or failing to contest the material allegations of a petition filed against the General Partner in a proceeding of the type described in clauses (A)-(C) of this Section 11.1(a)(iv) ; or (E) seeks, consents to or acquiesces in the appointment of a trustee (but not a debtor in possession), receiver or liquidator of the General Partner or of all or any substantial part of its properties;

(v)            a final and non-appealable order of relief under Chapter 7 of the United States Bankruptcy Code is entered by a court with appropriate jurisdiction pursuant to a voluntary or involuntary petition by or against the General Partner; or

 
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(vi)           (A) in the event the General Partner is a corporation, a certificate of dissolution or its equivalent is filed for the General Partner, or 90 days expire after the date of notice to the General Partner of revocation of its charter without a reinstatement of its charter, under the laws of its state of incorporation; (B) in the event the General Partner is a partnership or a limited liability company, the dissolution and commencement of winding up of the General Partner; (C) in the event the General Partner is acting in such capacity by virtue of being a trustee of a trust, the termination of the trust; (M) in the event the General Partner is a natural person, his death or adjudication of incompetency; and (D) otherwise in the event of the termination of the General Partner.

If an Event of Withdrawal specified in Section 11.1(a)(iv) , (v) or 11.1(a)(vi)(A) , (B) , (C) or (E) occurs, the withdrawing General Partner shall give notice to the Limited Partners within 30 days after such occurrence. The Partners hereby agree that only the Events of Withdrawal described in this Section 11.1 shall result in the withdrawal of the General Partner from the Partnership.

(b)            Withdrawal of the General Partner from the Partnership upon the occurrence of an Event of Withdrawal shall not constitute a breach of this Agreement under the following circumstances: (i)  at any time during the period beginning on the Initial Closing Date and ending at 12:00 midnight, Eastern Standard Time, on December 31, 2006, the General Partner voluntarily withdraws by giving at least 90 days’ advance notice of its intention to withdraw to the Limited Partners; provided that prior to the effective date of such withdrawal, the withdrawal is approved by the holders of a Majority Interest and the General Partner delivers to the Partnership an Opinion of Counsel (“ Withdrawal Opinion of Counsel ”) that such withdrawal (following the selection of the successor General Partner) would not result in the loss of the limited liability of any Limited Partner or any limited partner of Genesis OLP or cause the Partnership or Genesis OLP to be treated as an association taxable as a corporation or otherwise to be taxed as an entity for federal income tax purposes (to the extent not previously treated as such); (ii)  at any time after 12:00 midnight, Eastern Standard Time, on December 31, 2006, the General Partner voluntarily withdraws by giving at least 90 days’ advance notice to the Limited Partners, such withdrawal to take effect on the date specified in such notice; (iii) at any time that the General Partner ceases to be the General Partner pursuant to Section 11.1(a)(ii) or is removed pursuant to Section 11.2 ; or (iv) notwithstanding clause (i) of this sentence, at any time that the General Partner voluntarily withdraws by giving at least 90 days’ advance notice of its intention to withdraw to the Limited Partners, such withdrawal to take effect on the date specified in the notice, if at the time such notice is given one Person and its Affiliates (other than the General Partner and its Affiliates) own beneficially or of record or control at least 50% of the Outstanding Limited Partner Interests. The withdrawal of the General Partner from the Partnership upon the occurrence of an Event of Withdrawal shall also constitute the withdrawal of the General Partner as general partner or managing member of the other Group Members. If the General Partner gives a notice of withdrawal pursuant to Section 11.1(a)(i) , the holders of a Majority Interest, may, prior to the effective date of such withdrawal, elect a successor General Partner. The Person so elected as successor General Partner shall automatically become a successor general partner or managing member of the other Group Members of which the General Partner is a general partner. If, prior to the effective date of the General Partner’s withdrawal, a successor is not selected by the Limited Partners as provided herein or the Partnership does not receive a Withdrawal Opinion of Counsel, the Partnership shall be dissolved in accordance with Section 12.1 . Any successor General Partner elected in accordance with the terms of this Section 11.1 shall be subject to the provisions of Section 10.2 .

 
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11.2          Removal of the General Partner .  The General Partner may be removed with or without Cause. If Cause exists, the General Partner may be removed if such removal is approved by the holders of a Two-Thirds Interest (including Limited Partner Interests held by the General Partner and its Affiliates). Any such action by such holders for removal of the General Partner with Cause must also provide for the election of a successor General Partner by the holders of a Two-Thirds Interest (including Limited Partner Interests held by the General Partner and its Affiliates). If such removal is without Cause, such removal must be approved by the holders of a Majority Interest (excluding any Limited Partner Interests held by the General Partner and its Affiliates). Any such action by such holders for removal of the General Partner without Cause must also provide for the election of a successor General Partner by the holders of a Majority Interest (excluding any Limited Partner Interests held by the General Partner and its Affiliates). If it is proposed that the removal is without Cause, and an Affiliate of Denbury Resources Inc., a Delaware corporation (“ Denbury ”), or Denbury is the General Partner proposed to be removed and not proposed as a successor General Partner, then any such action for removal must also provide for Denbury to be granted an option immediately upon the effectiveness of the removal (the option to be exercisable for a period of 45 days following the determination of fair market value by independent appraisal in the manner set forth below) to purchase all of the Partnership’s then existing right, title and interest, if any, in the Partnership’s Mississippi pipeline system, with a termination point (as of July 31, 2002) at Maryland, Louisiana, and its associated real and personal property, easements, rights of way and storage facilities, at 110% of its fair market value (as determined by independent appraisal in the manner set forth below). Such option is to contain additional terms and conditions as reasonably acceptable to Denbury and the independent directors of the General Partner. Any removal of the General Partner shall be effective immediately following the admission of a successor General Partner, subject to the provisions of Section 10.2 . Such removal shall also automatically constitute the removal of the General Partner as general partner of the other Group Members of which the General Partner is a general partner. If a Person is elected as a successor General Partner in accordance with the terms of this Section 11.2 , such Person shall, upon admission pursuant to Section 10.2 , automatically become a successor general partner or managing member of the other Group Members of which the General Partner is a general partner. The right of the Limited Partners to remove the General Partner pursuant to this Section 11.2 shall not exist or be exercised unless the Partnership has received an opinion opining as to the matters covered by a Withdrawal Opinion of Counsel. Any successor General Partner elected in accordance with the terms of this Section 11.2 shall be subject to the provisions of Section 10.2 .

Upon removal of Denbury or its Affiliate as General Partner without Cause, and the granting of the option to Denbury as set forth above in the sixth sentence of this Section 11.2 and the election of the successor General Partner that is not Denbury or an Affiliate of Denbury, two independent appraisers shall be promptly selected, one appraiser to be selected by the successor General Partner and the other appraiser to be selected by Denbury. The fair market value of the Mississippi pipeline system will be determined by the agreement of these two independent appraisers acting reasonably and in good faith. In the event the two appraisers so selected do not reach an agreement as to the fair market value within 45 days following the selection of the second appraiser, the fair market value shall be the mid-point between each of the values determined reasonably and in good faith by the two appraisers.

 
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11.3          Removal or Other Elimination of Director Election Right .  Notwithstanding anything in this Agreement to the contrary, the right of the Common Units – Class B to elect Directors to the Board of Directors pursuant to Section 13.4(b) (together with the other rights set forth therein) shall continue to remain a right of the Common Units – Class B until the General Partner is removed and a successor General Partner is appointed pursuant to Section 11.2 , at which time the Common Units – Class B shall automatically convert to Common Units – Class A, as provided in Section 5.11 , and Section 13.4(b) shall be of no further force and effect at or after the time of such succession.  After the optional conversion of all Common Units – Class B to Common Units – Class A if a successor General Partner has not been appointed pursuant to Section 11.2 , the General Partner, acting in its capacity as the general partner of the Partnership, shall have the right (subject to the Unitholder Rights Agreement) to cause the Partnership to exercise its right as the sole member of the General Partner to appoint, replace or remove Directors, unless otherwise provided at the time of conversion or anytime thereafter.

11.4          Interest of Departing Partner and Successor General Partner .

(a)            In the event of the withdrawal of the General Partner under circumstances where such withdrawal does not violate this Agreement, if a successor General Partner is elected in accordance with the terms of Section 11.1 or 11.2, the Departing Partner shall have the option exercisable prior to the effective date of the departure of such Departing Partner to require its successor to purchase its General Partner Interest (collectively, the “ Combined Interest ”) in exchange for an amount in cash equal to the fair market value of such Combined Interest, such amount to be determined and payable as of the effective date of its departure. If the General Partner is removed by the Partners under circumstances where Cause exists or if the General Partner withdraws under circumstances where such withdrawal violates this Agreement or the Fourth Amended OLP Agreement, and if a successor General Partner is elected in accordance with the terms of Section 11.1 or 11.2 , such successor shall have the option, exercisable prior to the effective date of the departure of such Departing Partner, to purchase the Combined Interest of the Departing Partner for such fair market value of such Combined Interest. In either event, the Departing Partner shall be entitled to receive all reimbursements due such Departing Partner pursuant to Section 7.4 , including any employee-related liabilities (including severance liabilities), incurred in connection with the termination of any employees employed by the General Partner for the benefit of the Partnership or the other Group Members.

For purposes of this Section 11.4(a) , the fair market value of the Departing Partner’s Combined Interest shall be determined by agreement between the Departing Partner and its successor or, failing agreement within 30 days after the effective date of such Departing Partner’s departure, by an independent investment banking firm or other independent expert selected by the Departing Partner and its successor, which, in turn, may rely on other experts, and the determination of which shall be conclusive as to such matter. If such parties cannot agree upon one independent investment banking firm or other independent expert within 45 days after the effective date of such departure, then the Departing Partner shall designate an independent investment banking firm or other independent expert, the Departing Partner’s successor shall designate an independent investment banking firm or other independent expert, and such firms or experts shall mutually select a third independent investment banking firm or independent expert, which third independent investment banking firm or other independent expert shall determine the fair market value of the Combined Interest. In making its determination, such third independent investment banking firm or other independent expert may consider the then current trading price of Common Units – Class A on any National Securities Exchange on which Common Units – Class A are then listed, the value of the Partnership’s assets, the rights and obligations of the General Partner and other factors it may deem relevant.

 
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(b)            If the Combined Interest is not purchased in the manner set forth in Section 11.4(a) , the Departing Partner shall become a Limited Partner and the Combined Interest shall be converted into Common Units – Class A pursuant to a valuation made by an investment banking firm or other independent expert selected pursuant to Section 11.4(a) , without reduction in such Combined Interest (but subject to proportionate dilution by reason of the admission of its successor). Any successor General Partner shall indemnify the Departing Partner as to all debts and liabilities of the Partnership arising on or after the date on which the Departing Partner becomes a Limited Partner. For purposes of this Agreement, conversion of the General Partner’s Combined Interest to Common Units – Class A will be characterized as if the General Partner contributed its Combined Interest to the Partnership in exchange for the newly issued Common Units – Class A.

11.5          Withdrawal of Limited Partners .  No Limited Partner shall have any right to withdraw from the Partnership; provided , however , that when a transferee of a Limited Partner’s Limited Partner Interest becomes a Record Holder of the Limited Partner Interest so transferred, such transferring Limited Partner shall cease to be a Limited Partner with respect to the Limited Partner Interest so transferred.

ARTICLE XII
DISSOLUTION AND LIQUIDATION

12.1          Dissolution .  The Partnership shall not be dissolved by the admission of Substituted Limited Partners or Additional Limited Partners or by the admission of a successor General Partner in accordance with the terms of this Agreement. Upon the removal or withdrawal of the General Partner, if a successor General Partner is elected pursuant to Section 11.1 or 11.2 , the Partnership shall not be dissolved and such successor General Partner shall continue the business of the Partnership. The Partnership shall dissolve, and (subject to Section 12.2 ) its affairs shall be wound up, upon:

(a)            the expiration of its term as provided in Section 2.7 ;

(b)            an Event of Withdrawal of the General Partner as provided in Section 11.1(a) (other than Section 11.1(a)(ii) ), unless a successor is elected and an Opinion of Counsel is received as provided in Section 11.1(b) or 11.2 and such successor is admitted to the Partnership pursuant to Section 10.2 ;

(c)            an election to dissolve the Partnership by the General Partner that is approved by the holders of a Majority Interest;

 
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(d)            the entry of a decree of judicial dissolution of the Partnership pursuant to the provisions of the Delaware Act;

(e)            the dissolution of Genesis OLP; or

(f)            the sale of all or substantially all of the assets and properties of the Partnership Group.

12.2          Continuation of the Business of the Partnership after Dissolution .  Upon (a) dissolution of the Partnership following an Event of Withdrawal caused by the withdrawal or removal of the General Partner as provided in Section 11.1(a)(i) or 11.1(a)(iii) and the failure of the Partners to select a successor to such Departing Partner pursuant to Section 11.1 or 11.2 , then within 90 days thereafter, or (b) dissolution of the Partnership upon an event constituting an Event of Withdrawal as defined in Section 11.1(a)(iv) , 11.1(a)(v) or 11.1(a)(vi) , then, to the maximum extent permitted by law, within 180 days thereafter, the holders of a Majority Interest may elect to reconstitute the Partnership and continue its business on the same terms and conditions set forth in this Agreement by forming a new limited partnership on terms identical to those set forth in this Agreement and having as the successor general partner a Person approved by the holders of a Majority Interest. Unless such an election is made within the applicable time period as set forth above, the Partnership shall conduct only activities necessary to wind up its affairs. If such an election is so made, then:

(a)            the reconstituted Partnership shall continue until the end of the term set forth in Section 2.7 unless earlier dissolved in accordance with this Article XII ;

(b)            if the successor General Partner is not the former General Partner, then the interest of the former General Partner shall be treated in the manner provided in Section 11.4 ; and

(c)            all necessary steps shall be taken to cancel this Agreement and the Certificate of Limited Partnership and to enter into and, as necessary, to file a new partnership agreement and certificate of limited partnership, and the successor general partner may for this purpose exercise the powers of attorney granted the General Partner pursuant to Section 2.6 ; provided, that the right of the holders of a Majority Interest to approve a successor General Partner and to reconstitute and to continue the business of the Partnership shall not exist and may not be exercised unless the Partnership has received an Opinion of Counsel that (x) the exercise of the right would not result in the loss of limited liability of any Limited Partner and (y) neither the Partnership, the reconstituted limited partnership, Genesis OLP nor any Group Member would be treated as an association taxable as a corporation or otherwise be taxable as an entity for federal income tax purposes upon the exercise of such right to continue.

12.3          Liquidator .  Upon dissolution of the Partnership, unless the Partnership is continued under an election to reconstitute and continue the Partnership pursuant to Section 12.2 , the General Partner shall select one or more Persons to act as Liquidator. The Liquidator (if other than the General Partner) shall be entitled to receive such compensation for its services as may be approved by the holders of a Majority Interest. The Liquidator (if other than the General Partner) shall agree not to resign at any time without 15 days’ prior notice and may be removed at any time, with or without cause, by notice of removal approved by the holders of a Majority Interest. Upon dissolution, removal or resignation of the Liquidator, a successor and substitute Liquidator (who shall have and succeed to all rights, powers and duties of the original Liquidator) shall within 30 days thereafter be approved by the holders of a Majority Interest. The right to approve a successor or substitute Liquidator in the manner provided herein shall be deemed to refer also to any such successor or substitute Liquidator approved in the manner herein provided. Except as expressly provided in this Article XII , the Liquidator approved in the manner provided herein shall have and may exercise, without further authorization or consent of any of the parties hereto, all of the powers conferred upon the General Partner under the terms of this Agreement (but subject to all of the applicable limitations, contractual and otherwise, upon the exercise of such powers, other than the limitation on sale set forth in Section 7.3(b) ) to the extent necessary or desirable in the good faith judgment of the Liquidator to carry out the duties and functions of the Liquidator hereunder for and during such period of time as shall be reasonably required in the good faith judgment of the Liquidator to complete the winding up and liquidation of the Partnership as provided for herein.

 
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12.4          Liquidation .  The Liquidator shall proceed to dispose of the assets of the Partnership, discharge its liabilities, and otherwise wind up its affairs in such manner and over such period as the Liquidator determines to be in the best interest of the Partners, subject to Section 17-804 of the Delaware Act and the following:

(a)            Disposition of Assets. The assets may be disposed of by public or private sale or by distribution in kind to one or more Partners on such terms as the Liquidator and such Partner or Partners may agree. If any property is distributed in kind, the Partner receiving the property shall be deemed for purposes of Section 12.4(c) to have received cash equal to its fair market value; and contemporaneously therewith, appropriate cash distributions must be made to the other Partners. The Liquidator may, in its absolute discretion, defer liquidation or distribution of the Partnership’s assets for a reasonable time if it determines that an immediate sale of all or some of the Partnership’s assets would be impractical or would cause undue loss to the Partners. The Liquidator may, in its absolute discretion, distribute the Partnership’s assets, in whole or in part, in kind if it determines that a sale would be impractical or would cause undue loss to the Partners.

(b)            Discharge of Liabilities. Liabilities of the Partnership include amounts owed to Partners otherwise than in respect of their distribution rights under Article VI . With respect to any liability that is contingent, conditional or unmatured or is otherwise not yet due and payable, the Liquidator shall either settle such claim for such amount as it thinks appropriate or establish a reasonable reserve of cash or other assets to provide for its payment. When paid, any unused portion of the reserve shall be distributed as additional liquidation proceeds.

(c)            Liquidation Distributions. All property and all cash in excess of that required to discharge liabilities as provided in Section 12.4(b) shall be distributed to the Partners in accordance with, and to the extent of, the positive balances in their respective Capital Accounts, as determined after taking into account all Capital Account adjustments (other than those made by reason of distributions pursuant to this Section 12.4(c) ) for the taxable year of the Partnership during which the liquidation of the Partnership occurs (with such date of occurrence being determined pursuant to Treasury Regulation Section 1.704-1(b)(2)(ii)(g)), and such distribution shall be made by the end of such taxable year (or, if later, within 90 days after said date of such occurrence).

 
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12.5          Cancellation of Certificate of Limited Partnership .  Upon the completion of the distribution of Partnership cash and property as provided in Section 12.4 in connection with the liquidation of the Partnership, the Partnership shall be terminated and the Certificate of Limited Partnership and all qualifications of the Partnership as a foreign limited partnership in jurisdictions other than the State of Delaware shall be canceled and such other actions as may be necessary to terminate the Partnership shall be taken.

12.6          Return of Contributions .  The General Partner shall not be personally liable for, and shall have no obligation to contribute or loan any monies or property to the Partnership to enable it to effectuate, the return of the Capital Contributions of the Limited Partners, or any portion thereof, it being expressly understood that any such return shall be made solely from Partnership assets.

12.7          Waiver of Partition .  To the maximum extent permitted by law, each Partner hereby waives any right to partition of the Partnership property.

12.8          Capital Account Restoration .  No Partner shall have any obligation to restore any negative balance in its Capital Account upon liquidation of the Partnership.

ARTICLE XIII
AMENDMENT OF PARTNERSHIP AGREEMENT; MEETINGS; RECORD DATE

13.1          Amendment to be Adopted Solely by the General Partner .  Each Partner agrees that the General Partner, without the approval of any Partner or Assignee, may amend any provision of this Agreement and execute, swear to, acknowledge, deliver, file and record whatever documents may be required in connection therewith, to reflect:

(a)            a change in the name of the Partnership, the location of the principal place of business of the Partnership, the registered agent of the Partnership or the registered office of the Partnership;

(b)            admission, substitution, withdrawal or removal of Partners in accordance with this Agreement;

(c)            a change that, in the sole discretion of the General Partner, is necessary or advisable to qualify or continue the qualification of the Partnership as a limited partnership or a partnership in which the Limited Partners have limited liability under the laws of any state or to ensure that no Group Member will be treated as an association taxable as a corporation or otherwise taxed as an entity for federal income tax purposes;

(d)            a change that, in the discretion of the General Partner, (i) does not adversely affect the Limited Partners in any material respect, (ii) is necessary or advisable (A) to satisfy any requirements, conditions or guidelines contained in any opinion, directive, order, ruling or regulation of any federal or state agency or judicial authority or contained in any federal or state statute (including the Delaware Act), (B) to facilitate the trading of Limited Partner Interests (including the division of any class or classes of Outstanding Limited Partner Interests into different classes to facilitate uniformity of tax consequences within such classes of Limited Partner Interests) or comply with any rule, regulation, guideline or requirement of any National Securities Exchange on which Limited Partner Interests are or will be listed for trading, compliance with any of which the General Partner determines in its discretion to be in the best interests of the Partnership and the Limited Partners or (C) in connection with action taken by the General Partner pursuant to Section 5.8 , or (iii)  is required to effect the intent expressed in the Registration Statement or the Proxy Statement or the intent of the provisions of this Agreement or is otherwise contemplated by this Agreement;

 
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(e)            a change in the fiscal year or taxable year of the Partnership and any changes that, in the discretion of the General Partner, are necessary or advisable as a result of a change in the fiscal year or taxable year of the Partnership including, if the General Partner shall so determine, a change in the definition of “Quarter” and the dates on which distributions are to be made by the Partnership;

(f)            an amendment that is necessary, in the Opinion of Counsel, to prevent the Partnership or the General Partner or its directors, officers, trustees or agents from in any manner being subjected to the provisions of the Investment Company Act of 1940, as amended, the Investment Advisers Act of 1940, as amended, or “plan asset” regulations adopted under the Employee Retirement Income Security Act of 1974, as amended, regardless of whether such are substantially similar to plan asset regulations currently applied or proposed by the United States Department of Labor;

(g)            an amendment that, in the discretion of the General Partner, is necessary or advisable in connection with the authorization of issuance of any class or series of Partnership Securities pursuant to Section 5.6 ;

(h)            any amendment expressly permitted in this Agreement to be made by the General Partner acting alone;

(i)             an amendment effected, necessitated or contemplated by a Merger Agreement approved in accordance with Section 14.3 ;

(j)             an amendment that, in the discretion of the General Partner, is necessary or advisable to reflect, account for and deal with appropriately the formation by the Partnership of, or investment by the Partnership in, any corporation, partnership, joint venture, limited liability company or other entity, in connection with the conduct by the Partnership of activities permitted by the terms of Section 2.4 ;

(k)            a merger or conveyance pursuant to Section 14.3(d) ; or

(l)             any other amendments substantially similar to the foregoing.

13.2          Amendment Procedures .  Except as provided in Sections 13.1 and 13.3 , all amendments to this Agreement shall be made in accordance with the following requirements. Amendments to this Agreement may be proposed only by or with the consent of the General Partner, which consent may be given or withheld in its sole discretion. A proposed amendment shall be effective upon its approval by the holders of a Majority Interest, unless a greater or different percentage is required under this Agreement or by Delaware law. Each proposed amendment that requires the approval of the holders of a specified percentage of Outstanding Limited Partner Interests shall be set forth in a writing that contains the text of the proposed amendment. If such an amendment is proposed, the General Partner shall seek the written approval of the requisite percentage of Outstanding Limited Partner Interests or call a meeting of the Limited Partners to consider and vote on such proposed amendment. The General Partner shall notify all Record Holders upon final adoption of any such proposed amendments.

 
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13.3          Amendment Requirements .

(a)            Notwithstanding the provisions of Sections 13.1 and 13.2 , no provision of this Agreement that establishes a percentage of Outstanding Limited Partner Interests (including Limited Partner Interests deemed owned by the General Partner) required to take any action shall be amended, altered, changed, repealed or rescinded in any respect that would have the effect of reducing such voting percentage unless such amendment is approved by the written consent or the affirmative vote of holders of Outstanding Limited Partner Interests (including Limited Partner Interests deemed owned by the General Partner) whose aggregate Outstanding Limited Partner Interests constitute not less than the voting requirement sought to be reduced.

(b)            Notwithstanding the provisions of Sections 13.1 and 13.2 , no amendment to this Agreement may (i) enlarge the obligations of any Limited Partner without its consent, unless such shall be deemed to have occurred as a result of an amendment approved pursuant to Section 13.3(c) , (ii) enlarge the obligations of, restrict in any way any action by or rights of, or reduce in any way the amounts distributable, reimbursable or otherwise payable to, the General Partner or any of its Affiliates without its consent, which may be given or withheld in its sole discretion, (iii) change Section 12.1(a) or 12.1(c) , or (iv) change the term of the Partnership or, except as set forth in Section 12.1(c) or 12.1(e) , give any Person the right to dissolve the Partnership.

(c)            Except as provided in Section 14.3 , and except as otherwise provided, and without limitation of the General Partner’s authority to adopt amendments to this Agreement as contemplated in Section 13.1 , any amendment that would have a material adverse effect on the rights or preferences of any class of Partnership Interests in relation to other classes of Partnership Interests must be approved by the holders of not less than a majority of the Outstanding Partnership Interests of the class affected.

(d)            Notwithstanding any other provision of this Agreement, except for amendments pursuant to Section 7.3 or 13.1 and except as otherwise provided by Section 14.3(b) , no amendments shall become effective without the approval of the holders of a Ninety Percent Interest unless the Partnership obtains an Opinion of Counsel to the effect that such amendment will not affect the limited liability of any Limited Partner under applicable law.

(e)            Except as provided in Section 13.1 , this Section 13.3 shall only be amended with the approval of the holders of a Ninety Percent Interest.

 
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13.4          Special Meetings .

(a)            All acts of Limited Partners to be taken pursuant to this Agreement shall be taken in the manner provided in this Article XIII . Special meetings of the Limited Partners may be called by the General Partner or by Limited Partners owning 20% or more of the Outstanding Limited Partner Interests of the class or classes for which a meeting is proposed and which are entitled to vote thereat (a “ Limited Partner Group ”). Limited Partners shall call a special meeting by delivering to the General Partner one or more requests in writing stating that the signing Limited Partners wish to call a special meeting and indicating the general or specific purposes for which the special meeting is to be called. Within 60 days after receipt of such a call from Limited Partners or within such greater time as may be reasonably necessary for the Partnership to comply with any statutes, rules, regulations, listing agreements or similar requirements governing the holding of a meeting or the solicitation of proxies for use at such a meeting, the General Partner shall send a notice of the meeting to the Limited Partners either directly or indirectly through the Transfer Agent. A meeting shall be held at a time and place determined by the General Partner on a date not less than 10 days nor more than 60 days after the mailing of notice of the meeting. Limited Partners shall not vote on matters that would cause the Limited Partners to be deemed to be taking part in the management and control of the business and affairs of the Partnership so as to jeopardize the Limited Partners’ limited liability under the Delaware Act or the law of any other state in which the Partnership is qualified to do business.

(b)            (i) An annual meeting of the Limited Partners holding Outstanding Common Units – Class B for the election of Directors to the Board of Directors and such other matters as the General Partner shall submit to a vote of such Limited Partners holding Outstanding Units shall be held in June of each year beginning in 2011 or at such other date and time as may be fixed from time to time by the General Partner at such place within or without the State of Delaware as may be fixed from time to time by the General Partner and all as stated in the notice of the meeting.  Notice of the annual meeting shall be given in accordance with Section 13.5 not less than 10 days nor more than 60 days prior to the date of such meeting.

(ii)            The Limited Partners holding Outstanding Common Units – Class B (other than the General Partner and those Limited Partners holding a direct interest in the General Partner or any Affiliates of such Limited Partners) shall vote together as a single class for the election of Directors to the Board of Directors (but such Limited Partners and their Units shall not, however, be treated as a separate class of Partners or Partnership Securities for other purposes of this Agreement).  The Limited Partners described in the immediately preceding sentence shall elect by a plurality of the votes cast at such meeting at which a quorum is present persons to serve as Directors who are nominated in accordance with the provisions of this Section 13.4(b) (or Section 13.11 to the extent applicable).  The exercise by a Limited Partner of the right to elect the Directors and any other rights afforded to such Limited Partner under this Section 13.4(b) shall be in such Limited Partner’s capacity as a limited partner of the Partnership and shall not cause a Limited Partner to be deemed to be taking part in the management and control of the business and affairs of the Partnership so as to jeopardize such Limited Partner’s limited liability under the Delaware Act or the law of any other state in which the Partnership is qualified to do business.

 
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(iii)           Solely with respect to the election and removal of Directors to the Board of Directors, the General Partner, those Limited Partners holding a direct interest in the General Partner and any Affiliates of such Limited Partners shall not be entitled to vote Units that are otherwise entitled to vote at any meeting of the Unitholders.  If the General Partner has provided at least 30 days advance notice of any meeting at which Directors are to be elected, then the Limited Partners holding Outstanding Common Units – Class B (other than the General Partner and those Limited Partners holding a direct interest in the General Partner or any Affiliates of such Limited Partners) that attend such meeting shall constitute a quorum, and if the General Partner has provided less than 30 days advance notice of any such meeting, then Limited Partners holding a majority of the Outstanding Common Units – Class B (other than the General Partner and those Limited Partners holding a direct interest in the General Partner or any Affiliates of such Limited Partners) shall constitute a quorum.

(iv)           The number of Directors on the Board of Directors shall be 11, unless otherwise fixed from time to time pursuant to a resolution adopted by a majority of the Directors then in office.  Each person serving as a Director immediately prior to the effectiveness of this Agreement shall continue as a Director.

(v)            Each Director shall hold office for the term for which such Director is elected and thereafter until such Director’s successor shall have been duly elected and qualified, or until such Director’s earlier death, resignation or removal.  A majority of the remaining Directors may nominate and elect a person to fill any vacancy on the Board of Directors (including, without limitation, any vacancy caused by an increase in the number of Directors on the Board of Directors).  Any Director elected to fill a vacancy not resulting from an increase in the number of Directors shall have the same remaining term as that of his predecessor.  A Director may be removed only upon the affirmative vote of Limited Partners holding a majority of the Outstanding Common Units – Class B (other than the General Partner and those Limited Partners holding a direct interest in the General Partner or any Affiliates of such Limited Partners); provided , however , a Director may only be removed if, at the same meeting, Limited Partners holding a majority of the Outstanding Common Units – Class B nominate a replacement Director (and any such nomination shall not be subject to the nomination procedures otherwise set forth in this Section 13.4 ), and Limited Partners holding a majority of the Outstanding Common Units – Class B (other than the General Partner and those Limited Partners holding a direct interest in the General Partner or any Affiliates of such Limited Partners) also vote to elect a replacement Director.

(vi)           Nominations of persons for election as a Director to the Board of Directors may be made (A) at an annual or special meeting of Limited Partners at which Directors are to be elected pursuant to the General Partner’s notice of meeting (1) by or at the direction of a majority of the Directors or (2) by any Limited Partner Group pursuant to Section 13.4(a) hereof if each member of such Limited Partner Group is a Record Holder of Common Units – Class B at the time the notice provided for in this Section 13.4(b)(vi) is delivered to the General Partner, or (B) otherwise in connection with a written consent of the holders of Common Units – Class B under Section 13.11 .  In the event the General Partner calls a special meeting of Limited Partners for the purpose of electing one or more Directors to the Board of Directors, any such Limited Partner Group (each member of which is a Record Holder of Common Units – Class B) may nominate a person or persons (as the case may be) for election to such position(s) as specified in the General Partner’s notice of meeting.

 
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(vii)          This Section 13.4(b) shall not be deemed in any way to limit or impair the ability of the Board of Directors to adopt a “poison pill” or unitholder or other similar rights plan with respect to the Partnership, whether such poison pill or plan contains “dead hand” provisions, “no hand” provisions or other provisions relating to the redemption of the poison pill or plan, in each case as such terms are used under Delaware common law.

(viii)         Subject to Section 11.3 , the Partnership and the General Partner shall use their commercially reasonable best efforts to take such action as shall be necessary or appropriate to give effect to and implement the provisions of this Section 13.4(b) , including, without limitation, amending the organizational documents of the General Partner such that at all times the organizational documents of the General Partner shall provide (i) that the Directors shall be elected in accordance with the terms of this Agreement, and (ii) terms consistent with this Section 13.4(b) .

(ix)           Subject to Section 11.3 , if the General Partner delegates to an existing or newly formed wholly owned Subsidiary the power and authority to manage and control the business and affairs of the Partnership Group, the foregoing provisions of this Section 13.4(b) shall be applicable with respect to the Board of Directors or other governing body of such Subsidiary.

(x)             This Section 13.4(b) shall not be deemed in any way to limit or impair the ability of the Board of Directors to amend or modify those provisions relating to the election, removal, nomination and replacement of Directors, and similar matters, under this Agreement or the General Partner Agreement.

(xi)            Notwithstanding anything in this Agreement to the contrary, the provisions of this Section 13.4(b) shall at all times be subject to the provisions of the Unitholder Rights Agreement and Section 11.3 .

13.5          Notice of a Meeting .  Notice of a meeting called pursuant to Section 13.4 shall be given to the Record Holders of the class or classes of Limited Partner Interests for which a meeting is proposed in writing by mail or other means of written communication in accordance with Section 16.1 . The notice shall be deemed to have been given at the time when deposited in the mail or sent by other means of written communication.

13.6          Record Date .  For purposes of determining the Limited Partners entitled to notice of or to vote at a meeting of the Limited Partners or to give approvals without a meeting as provided in Section 13.11 , the General Partner may set a Record Date, which shall not be less than 10 nor more than 60 days before (a) the date of the meeting (unless such requirement conflicts with any rule, regulation, guideline or requirement of any National Securities Exchange on which Limited Partner Interests are listed for trading, in which case the rule, regulation, guideline or requirement of such exchange shall govern) or (b) in the event that approvals are sought without a meeting, the date by which Limited Partners are requested in writing by the General Partner to give such approvals.

 
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13.7          Adjournment .  When a meeting is adjourned to another time or place, notice need not be given of the adjourned meeting and a new Record Date need not be fixed, if the time and place thereof are announced at the meeting at which the adjournment is taken, unless such adjournment shall be for more than 45 days. At the adjourned meeting, the Partnership may transact any business which might have been transacted at the original meeting. If the adjournment is for more than 45 days or if a new Record Date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given in accordance with this Article XIII .

13.8          Waiver of Notice; Approval of Meeting; Approval of Minutes .  The transactions of any meeting of Limited Partners, however called and noticed, and whenever held, shall be as valid as if occurred at a meeting duly held after regular call and notice, if a quorum is present either in person or by proxy, and if, either before or after the meeting, Limited Partners representing such quorum who were present in person or by proxy and entitled to vote, sign a written waiver of notice or an approval of the holding of the meeting or an approval of the minutes thereof. All waivers and approvals shall be filed with the Partnership records or made a part of the minutes of the meeting. Attendance of a Limited Partner at a meeting shall constitute a waiver of notice of the meeting, except when the Limited Partner does not approve, at the beginning of the meeting, of the transaction of any business because the meeting is not lawfully called or convened; and except that attendance at a meeting is not a waiver of any right to disapprove the consideration of matters required to be included in the notice of the meeting, but not so included, if the disapproval is expressly made at the meeting.

13.9          Quorum .  Subject to Section 13.4(b) , holders of a majority of the applicable Outstanding Limited Partner Interests (including Limited Partner Interests deemed owned by the General Partner) of the class or classes for which a meeting has been called and which are entitled to vote represented in person or by proxy shall constitute a quorum at a meeting of Limited Partners of such class or classes unless any such action by the Limited Partners requires approval by holders of a greater percentage of such Limited Partner Interests, in which case the quorum shall be such greater percentage. At any meeting of the applicable Limited Partners duly called and held in accordance with this Agreement at which a quorum is present, the act of Limited Partners holding Outstanding Limited Partner Interests (including Limited Partner Interests deemed owned by the General Partner) that in the aggregate represent a majority of the Outstanding Limited Partner Interests (including Limited Partner Interests deemed owned by the General Partner) entitled to vote and be present in person or by proxy at such meeting shall be deemed to constitute the act of all Limited Partners, unless a greater or different percentage is required with respect to such action under the provisions of this Agreement, in which case the act of the Limited Partners holding Outstanding Limited Partner Interests (including Limited Partner Interests deemed owned by the General Partner) that in the aggregate represent at least such greater or different percentage shall be required. The Limited Partners present at a duly called or held meeting at which a quorum is present may continue to transact business until adjournment, notwithstanding the withdrawal of enough Limited Partners to leave less than a quorum, if any action taken (other than adjournment) is approved by the required percentage of Outstanding Limited Partner Interests (including Limited Partner Interests deemed owned by the General Partner) specified in this Agreement. In the absence of a quorum any meeting of Limited Partners may be adjourned from time to time by the affirmative vote of holders of at least a majority of the Outstanding Limited Partner Interests (including Limited Partner Interests deemed owned by the General Partner) entitled to vote at such meeting represented either in person or by proxy, but no other business may be transacted, except as provided in Section 13.7 .

 
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13.10       Conduct of a Meeting .  The General Partner shall have full power and authority concerning the manner of conducting any meeting of the Partners or solicitation of approvals in writing, including the determination of Persons entitled to vote, the existence of a quorum, the satisfaction of the requirements of Section 13.4, the conduct of voting, the validity and effect of any proxies and the determination of any controversies, votes or challenges arising in connection with or during the meeting or voting. The General Partner shall designate a Person to serve as chairman of any meeting and shall further designate a Person to take the minutes of any meeting. All minutes shall be kept with the records of the Partnership maintained by the General Partner. The General Partner may make such other regulations consistent with applicable law and this Agreement as it may deem advisable concerning the conduct of any meeting of the Partners or solicitation of approvals in writing, including regulations in regard to the appointment of proxies, the appointment and duties of inspectors of votes and approvals, the submission and examination of proxies and other evidence of the right to vote, and the revocation of approvals in writing.

13.11       Action Without a Meeting .  If authorized by the General Partner (or at any time with respect to the election of Directors, or the taking of any other action provided for under Section 13.4(b) , by the holders of the Outstanding Common Units – Class B holding at least a majority of the Common Units – Class B), any action that may be taken at a meeting of the Limited Partners may be taken without a meeting if an approval in writing setting forth the action so taken is signed by Limited Partners owning not less than the minimum percentage of the Outstanding Limited Partner Interests (including Limited Partner Interests deemed owned by the General Partner) that would be necessary to authorize or take such action at a meeting at which all the Limited Partners were present and voted (unless such provision conflicts with any rule, regulation, guideline or requirement of any National Securities Exchange on which Limited Partner Interests are listed for trading, in which case the rule, regulation, guideline or requirement of such exchange shall govern). Prompt notice of the taking of action without a meeting shall be given to the Limited Partners who have not approved in writing. The General Partner may specify that any written ballot submitted to Limited Partners for the purpose of taking any action without a meeting shall be returned to the Partnership within the time period, which shall be not less than 20 days, specified by the General Partner. If a ballot returned to the Partnership does not vote all of the Limited Partner Interests held by a Limited Partner the Partnership shall be deemed to have failed to receive a ballot for the Limited Partner Interests that were not voted. If approval of the taking of any action by the Limited Partners is solicited by any Person other than by or on behalf of the General Partner, the written approvals shall have no force and effect unless and until (a) they are deposited with the Partnership in care of the General Partner, (b) approvals sufficient to take the action proposed are dated as of a date not more than 90 days prior to the date sufficient approvals are deposited with the Partnership and (c) an Opinion of Counsel is delivered to the General Partner to the effect that the exercise of such right and the action proposed to be taken with respect to any particular matter (i) will not cause the Limited Partners to be deemed to be taking part in the management and control of the business and affairs of the Partnership so as to jeopardize the Limited Partners’ limited liability, and (ii) is otherwise permissible under the state statutes then governing the rights, duties and liabilities of the Partnership and the Partners.

 
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13.12       Voting and Other Rights .

(a)            Only those Record Holders of the Limited Partner Interests on the Record Date set pursuant to Section 13.6 (and also subject to the limitations contained in the definition of “Outstanding”) and entitled to vote at the meeting shall be entitled to notice of, and to vote at, a meeting of Limited Partners or to act with respect to matters as to which the holders of the Outstanding Limited Partner Interests have the right to vote or to act. All references in this Agreement to votes of, or other acts that may be taken by, the Outstanding Limited Partner Interests shall be deemed to be references to the votes or acts of the Record Holders of such Outstanding Limited Partner Interests.

(b)            With respect to Limited Partner Interests that are held for a Person’s account by another Person (such as a broker, dealer, bank, trust company or clearing corporation, or an agent of any of the foregoing), in whose name such Limited Partner Interests are registered, such other Person shall, in exercising the voting rights in respect of such Limited Partner Interests on any matter, and unless the arrangement between such Persons provides otherwise, vote such Limited Partner Interests in favor of, and at the direction of, the Person who is the beneficial owner, and the Partnership shall be entitled to assume it is so acting without further inquiry. The provisions of this Section 13.12(b) (as well as all other provisions of this Agreement) are subject to the provisions of Section 4.3 .

ARTICLE XIV
MERGER

14.1          Authority .  The Partnership may merge or consolidate with one or more corporations, limited liability companies, business trusts or associations, real estate investment trusts, common law trusts or unincorporated businesses, including a general partnership or limited partnership, formed under the laws of the State of Delaware or any other state of the United States of America, pursuant to a written agreement of merger or consolidation (“ Merger Agreement ”) in accordance with this Article XIV .

14.2          Procedure for Merger or Consolidation .  Merger or consolidation of the Partnership pursuant to this Article XIV requires the prior approval of the General Partner. If the General Partner shall determine, in the exercise of its discretion, to consent to the merger or consolidation, the General Partner shall approve the Merger Agreement, which shall set forth:

(a)            The names and jurisdictions of formation or organization of each of the business entities proposing to merge or consolidate;

(b)            The name and jurisdiction of formation or organization of the business entity that is to survive the proposed merger or consolidation (the “ Surviving Business Entity ”);

(c)            The terms and conditions of the proposed merger or consolidation;

 
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(d)            The manner and basis of exchanging or converting the equity securities of each constituent business entity for, or into, cash, property or general or limited partner interests, rights, securities or obligations of the Surviving Business Entity; and (i) if any general or limited partner interests, securities or rights of any constituent business entity are not to be exchanged or converted solely for, or into, cash, property or general or limited partner interests, rights, securities or obligations of the Surviving Business Entity, the cash, property or general or limited partner interests, rights, securities or obligations of any limited partnership, corporation, trust or other entity (other than the Surviving Business Entity) which the holders of such general or limited partner interests, securities or rights are to receive in exchange for, or upon conversion of their general or limited partner interests, securities or rights, and (ii) in the case of securities represented by certificates, upon the surrender of such certificates, which cash, property or general or limited partner interests, rights, securities or obligations of the Surviving Business Entity or any general or limited partnership, corporation, trust or other entity (other than the Surviving Business Entity), or evidences thereof, are to be delivered;

(e)            A statement of any changes in the constituent documents or the adoption of new constituent documents (the articles or certificate of incorporation, articles of trust, declaration of trust, certificate or agreement of limited partnership, certificate of formation or limited liability company agreement or other similar charter or governing document) of the Surviving Business Entity to be effected by such merger or consolidation;

(f)            The effective time of the merger, which may be the date of the filing of the certificate of merger pursuant to Section 14.4 or a later date specified in or determinable in accordance with the Merger Agreement (provided, that if the effective time of the merger is to be later than the date of the filing of the certificate of merger, the effective time shall be fixed no later than the time of the filing of the certificate of merger and stated therein); and

(g)            Such other provisions with respect to the proposed merger or consolidation as are deemed necessary or appropriate by the General Partner.

14.3          Approval by Limited Partners of Merger or Consolidation .

(a)            Except as provided in Section 14.3(d) , the General Partner, upon its approval of the Merger Agreement, shall direct that the Merger Agreement be submitted to a vote of the Limited Partners, whether at a special meeting or by written consent, in either case in accordance with the requirements of Article XIII . A copy or a summary of the Merger Agreement shall be included in or enclosed with the notice of a special meeting or the written consent.

(b)            Except as provided in Section 14.3(d) , the Merger Agreement shall be approved upon receiving the affirmative vote or consent of the holders of a Majority Interest unless the Merger Agreement contains any provision that, if contained in an amendment to this Agreement, the provisions of this Agreement or the Delaware Act would require the vote or consent of a greater percentage of the Outstanding Limited Partner Interests or of any class of Limited Partners, in which case such greater percentage vote or consent shall be required for approval of the Merger Agreement.

 
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(c)            Except as provided in Section 14.3(d) , after such approval by vote or consent of the Limited Partners, and at any time prior to the filing of the certificate of merger pursuant to Section 14.4 , the merger or consolidation may be abandoned pursuant to provisions therefor, if any, set forth in the Merger Agreement.

(d)            Notwithstanding anything else contained in this Article XIV or in this Agreement, the General Partner is permitted, in its discretion, without Limited Partner approval, to merge the Partnership or any Group Member into, or convey all of the Partnership’s assets to, another limited liability entity which shall be newly formed and shall have no assets, liabilities or operations at the time of such Merger other than those it receives from the Partnership or other Group Member if (i) the General Partner has received an Opinion of Counsel that the merger or conveyance, as the case may be, would not result in the loss of the limited liability of any Limited Partner or any limited partner in Genesis OLP or cause the Partnership or Genesis OLP to be treated as an association taxable as a corporation or otherwise to be taxed as an entity for federal income tax purposes (to the extent not previously treated as such), (ii) the sole purpose of such merger or conveyance is to effect a mere change in the legal form of the Partnership into another limited liability entity and (iii) the governing instruments of the new entity provide the Limited Partners and the General Partner with the same rights and obligations as are herein contained.

14.4          Certificate of Merger .  Upon the required approval by the General Partner and the Limited Partners of a Merger Agreement, a certificate of merger shall be executed and filed with the Secretary of State of the State of Delaware in conformity with the requirements of the Delaware Act.

14.5          Effect of Merger .

(a)            At the effective time of the certificate of merger:

(i)             all of the rights, privileges and powers of each of the business entities that has merged or consolidated, and all property, real, personal and mixed, and all debts due to any of those business entities and all other things and causes of action belonging to each of those business entities shall be vested in the Surviving Business Entity and after the merger or consolidation shall be the property of the Surviving Business Entity to the extent they were of each constituent business entity;

(ii)            the title to any real property vested by deed or otherwise in any of those constituent business entities shall not revert and is not in any way impaired because of the merger or consolidation;

(iii)           all rights of creditors and all liens on or security interests in property of any of those constituent business entities shall be preserved unimpaired; and

(iv)           all debts, liabilities and duties of those constituent business entities shall attach to the Surviving Business Entity, and may be enforced against it to the same extent as if the debts, liabilities and duties had been incurred or contracted by it.

 
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(b)            A merger or consolidation effected pursuant to this Article XIV shall not be deemed to result in a transfer or assignment of assets or liabilities from one entity to another.

ARTICLE XV
RIGHT TO ACQUIRE LIMITED PARTNER INTERESTS

15.1          Right to Acquire Limited Partner Interests .

(a)            Notwithstanding any other provision of this Agreement, if at any time not more than 20% of the total Limited Partner Interests of any class then Outstanding are held by Persons other than the General Partner, the Partnership and their respective Subsidiaries, the General Partner shall then have the right, which right it may assign and transfer in whole or in part to the Partnership or any of its Subsidiaries, exercisable in its sole discretion, to purchase all, but not less than all, of such Limited Partner Interests of such class then Outstanding held by Persons other than the General Partner, the Partnership and any of their respective Subsidiaries, at the greater of (x) the Current Market Price as of the date three days prior to the date that the notice described in Section 15.1(b) is mailed and (y) the highest price paid by the General Partner, the Partnership or any of their respective Subsidiaries for any such Limited Partner Interest of such class purchased during the 90-day period preceding the date that the notice described in Section 15.1(b) is mailed. As used in this Agreement, (i) “Current Market Price” as of any date of any class of Limited Partner Interests listed or admitted to trading on any National Securities Exchange means the average of the daily Closing Prices (as hereinafter defined) per Limited Partner Interest of such class for the 20 consecutive Trading Days (as hereinafter defined) immediately prior to such date; (ii) “Closing Price” for any day means the last sale price on such day, regular way, or in case no such sale takes place on such day, the average of the closing bid and asked prices on such day, regular way, in either case as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted for trading on the principal National Securities Exchange (other than the Nasdaq Stock Market) on which such Limited Partner Interests of such class are listed or admitted to trading or, if such Limited Partner Interests of such class are not listed or admitted to trading on any National Securities Exchange (other than the Nasdaq Stock Market), the last quoted price on such day or, if not so quoted, the average of the high bid and low asked prices on such day in the over-the-counter market, as reported by the Nasdaq Stock Market or such other system then in use, or, if on any such day such Limited Partner Interests of such class are not quoted by any such organization, the average of the closing bid and asked prices on such day as furnished by a professional market maker making a market in such Limited Partner Interests of such class selected by the General Partner, or if on any such day no market maker is making a market in such Limited Partner Interests of such class, the fair value of such Limited Partner Interests on such day as determined reasonably and in good faith by the General Partner; and (iii) “Trading Day” means a day on which the principal National Securities Exchange on which such Limited Partner Interests of any class are listed or admitted to trading is open for the transaction of business or, if Limited Partner Interests of a class are not listed or admitted to trading on any National Securities Exchange, a day on which banking institutions in New York City generally are open.

 
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(b)            If the General Partner, the Partnership or any of their respective Subsidiaries elects to exercise the right to purchase Limited Partner Interests granted pursuant to Section 15.1(a) , the General Partner shall deliver to the Transfer Agent notice of such election to purchase (the “ Notice of Election to Purchase ”) and shall cause the Transfer Agent to mail a copy of such Notice of Election to Purchase to the Record Holders of Limited Partner Interests of such class (as of a Record Date selected by the General Partner) at least 10, but not more than 60, days prior to the Purchase Date. Such Notice of Election to Purchase shall also be published for a period of at least three consecutive days in at least two daily newspapers of general circulation printed in the English language and published in the Borough of Manhattan, New York. The Notice of Election to Purchase shall specify the Purchase Date and the price (determined in accordance with Section 15.1(a) ) at which Limited Partner Interests will be purchased and state that the General Partner, the Partnership or any of their respective Subsidiaries, as the case may be, elects to purchase such Limited Partner Interests, upon surrender of Certificates representing such Limited Partner Interests, or upon receipt of evidence of the ownership of uncertificated Common Units – Class A to the extent any Common Units comprising the Limited Partner Interest are uncertificated,  in exchange for payment, at such office or offices of the Transfer Agent as the Transfer Agent may specify, or as may be required by any National Securities Exchange on which such Limited Partner Interests are listed or admitted to trading. Any such Notice of Election to Purchase mailed to a Record Holder of Limited Partner Interests at his address as reflected in the records of the Transfer Agent shall be conclusively presumed to have been given regardless of whether the owner receives such notice. On or prior to the Purchase Date, the General Partner, the Partnership or any of their respective Subsidiaries, as the case may be, shall deposit with the Transfer Agent cash in an amount sufficient to pay the aggregate purchase price of all of such Limited Partner Interests to be purchased in accordance with this Section 15.1 . If the Notice of Election to Purchase shall have been duly given as aforesaid at least 10 days prior to the Purchase Date, and if on or prior to the Purchase Date the deposit described in the preceding sentence has been made for the benefit of the holders of Limited Partner Interests subject to purchase as provided herein, then from and after the Purchase Date, notwithstanding that any Certificate (or evidence of uncertification) shall not have been surrendered for purchase, all rights of the holders of such Limited Partner Interests (including any rights pursuant to Article IV , Article V , Article VI , and Article XII ) shall thereupon cease, except the right to receive the purchase price (determined in accordance with Section 15.1(a) ) for Limited Partner Interests therefor, without interest, upon surrender to the Transfer Agent of the Certificates, or evidence of the ownership of uncertificated Common Units, representing such Limited Partner Interests, and such Limited Partner Interests shall thereupon be deemed to be transferred to the General Partner, the Partnership or any of their respective Subsidiaries, as the case may be, on the record books of the Transfer Agent and the Partnership, and the General Partner or any Subsidiaries of the General Partner, or the Partnership, as the case may be, shall be deemed to be the owner of all such Limited Partner Interests from and after the Purchase Date and shall have all rights as the owner of such Limited Partner Interests (including all rights as owner of such Limited Partner Interests pursuant to Article IV , Article V , Article VI , and Article XII ).

(c)            At any time from and after the Purchase Date, a holder of an Outstanding Limited Partner Interest subject to purchase as provided in this Section 15.1 may surrender his Certificate evidencing such Limited Partner Interest or evidence of ownership of uncertificated Common Units – Class A comprising all or part of such Limited Partner Interest to the Transfer Agent in exchange for payment of the amount described in Section 15.1(a) , therefor, without interest thereon.

 
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ARTICLE XVI
GENERAL PROVISIONS

16.1          Addresses and Notices .  Any notice, demand, request, report or proxy materials required or permitted to be given or made to a Partner or Assignee under this Agreement shall be in writing and shall be deemed given or made when delivered in person or when sent by first class United States mail or by other means of written communication to the Partner or Assignee at the address described below. Any notice, payment or report to be given or made to a Partner or Assignee hereunder shall be deemed conclusively to have been given or made, and the obligation to give such notice or report or to make such payment shall be deemed conclusively to have been fully satisfied, upon sending of such notice, payment or report to the Record Holder of such Partnership Security at his address as shown on the records of the Transfer Agent or as otherwise shown on the records of the Partnership, regardless of any claim of any Person who may have an interest in such Partnership Security by reason of any assignment or otherwise. An affidavit or certificate of making of any notice, payment or report in accordance with the provisions of this Section 16.1 executed by the General Partner, the Transfer Agent or the mailing organization shall be prima facie evidence of the giving or making of such notice, payment or report. If any notice, payment or report addressed to a Record Holder at the address of such Record Holder appearing on the books and records of the Transfer Agent or the Partnership is returned by the United States Post Office marked to indicate that the United States Postal Service is unable to deliver it, such notice, payment or report and any subsequent notices, payments and reports shall be deemed to have been duly given or made without further mailing (until such time as such Record Holder or another Person notifies the Transfer Agent or the Partnership of a change in his address) if they are available for the Partner or Assignee at the principal office of the Partnership for a period of one year from the date of the giving or making of such notice, payment or report to the other Partners and Assignees. Any notice to the Partnership shall be deemed given if received by the General Partner at the principal office of the Partnership designated pursuant to Section 2.3. The General Partner may rely and shall be protected in relying on any notice or other document from a Partner, Assignee or other Person if believed by it to be genuine.

16.2          Further Action .  The parties shall execute and deliver all documents, provide all information and take or refrain from taking action as may be necessary or appropriate to achieve the purposes of this Agreement.

16.3          Binding Effect .  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their heirs, executors, administrators, successors, legal representatives and permitted assigns.

16.4          Integration .  This Agreement constitutes the entire agreement among the parties hereto pertaining to the subject matter hereof and supersedes all prior agreements and understandings pertaining thereto.

16.5          Creditors .  None of the provisions of this Agreement shall be for the benefit of, or shall be enforceable by, any creditor of the Partnership.

16.6          Waiver .  No failure by any party to insist upon the strict performance of any covenant, duty, agreement or condition of this Agreement or to exercise any right or remedy consequent upon a breach thereof shall constitute waiver of any such breach of any other covenant, duty, agreement or condition.

 
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16.7          Counterparts .  This Agreement may be executed in counterparts, all of which together shall constitute an agreement binding on all the parties hereto, notwithstanding that all such parties are not signatories to the original or the same counterpart. Each party shall become bound by this Agreement immediately upon affixing its signature hereto or, in the case of a Person acquiring a Limited Partner Interest, upon accepting the certificate evidencing such Limited Partner Interest or executing and delivering a Transfer Application as herein described, independently of the signature of any other party.

16.8          Applicable Law .  This Agreement shall be construed in accordance with and governed by the laws of the State of Delaware, without regard to the principles of conflicts of law.

16.9          Invalidity of Provisions .  If any provision of this Agreement is or becomes invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not be affected thereby.

16.10       Consent of Partners .  Each Partner hereby expressly consents and agrees that, whenever in this Agreement it is specified that an action may be taken upon the affirmative vote or consent of less than all of the Partners, such action may be so taken upon the concurrence of less than all of the Partners and each Partner shall be bound by the results of such action.

[Remainder of Page Intentionally Left Blank]

 
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

 
GENERAL PARTNER:
   
 
GENESIS ENERGY, LLC
   
 
By:
  /s/ Robert C. Sturdivant
 
Name:
Robert C. Sturdivant
 
Title:
Chairman of the Board

LIMITED PARTNERS:

All Limited Partners previously and hereafter admitted as Limited Partners of the Partnership, pursuant to powers of attorney previously and hereafter executed in favor of, and granted and delivered to the General Partner.

By: GENESIS ENERGY, LLC , the General Partner, as attorney-in-fact for all Limited Partners pursuant to the Powers of Attorney granted pursuant to Section 2.6 .

 
GENESIS ENERGY, LLC
   
 
By:
  /s/ Grant E. Sims
 
Name:
Grant E. Sims
 
Title:
Chief Executive Officer

[Signature Page – Fifth Amended and Restated Agreement of Limited Partnership (1 of 1)]

 
 

 

EXHIBIT A

WAIVER UNITS / CLASS B UNITS CONVERSION NOTICE
(TO BE EXECUTED BY THE REGISTERED HOLDER IN ORDER TO CONVERT
WAIVER UNITS / CLASS B UNITS)

[Date]

The undersigned hereby elects to convert the number of Waiver Units (“ Waiver Units ”) or of Common Units - Class B (“ Common Units – Class B ,” and together with Waiver Units, “ Converted Units ”) of Genesis Energy, L.P., a Delaware limited partnership (the “ Partnership ”), indicated below into Common Units - Class A (“ Common Units – Class A ”) of the Partnership, according to the conditions hereof, as of the date written below.  If Common Units – Class A are to be issued in the name of a person other than the holder of such Converted Units, such holder will pay all transfer taxes payable with respect thereto and will deliver such certificates and opinions as may be required by the Partnership or its transfer agent.  No fee will be charged to the holders for any conversion, except for any such transfer taxes.

Class of Converted Units (Waiver Units or Common Units – Class B):
 
   
Number of Converted Units Owned:
 
   
Number of Common Units – Class A to be Issued:
 
   
Name in which Certificate for Common Units – Class A is to be Issued:
 
 
   
Address for Delivery:
 

[Signature Page Follows]

 
 

 

 
HOLDER:
   
   
 
By:
 
 
Name:
 
 
Title:
 
 
 
[Signature Page to Converted Units Conversion Notice]
 
 


Exhibit 5.2
 
Execution Copy
 

 
 
SECOND AMENDED AND RESTATED

LIMITED LIABILITY COMPANY AGREEMENT

OF

GENESIS ENERGY, LLC

a Delaware limited liability company
 

December 28, 2010
 
 


 
 

 

SECOND AMENDED AND RESTATED
LIMITED LIABILITY COMPANY AGREEMENT
OF
GENESIS ENERGY, LLC
a Delaware limited liability company

TABLE OF CONTENTS

ARTICLE 1 DEFINITIONS AND CONSTRUCTION
2
 
1.1
Definitions
2
 
1.2
Construction
2
       
ARTICLE 2 ORGANIZATION
3
 
2.1
Formation and Continuation of the Company
3
 
2.2
Name
3
 
2.3
Registered Office; Registered Agent; Principal Office; Other Offices
3
 
2.4
Purposes
3
 
2.5
Term
3
 
2.6
No State Law Partnership
3
 
2.7
Title to Company Assets
3
       
ARTICLE 3 MEMBERSHIP INTERESTS; MEMBERS
4
 
3.1
Members
4
 
3.2
Admission of Additional Members and Substituted Members and Creation of Additional Membership Interests
4
 
3.3
No Liability of Members
4
       
ARTICLE 4 CAPITAL CONTRIBUTIONS
5
 
4.1
Capital Contributions
5
 
4.2
Return of Contributions
5
 
4.3
Advances by Members
5
       
ARTICLE 5 DISTRIBUTIONS
5
 
5.1
Distributions
5
       
ARTICLE 6 DISPOSITION OF Membership interests
6
 
6.1
Restrictions On Dispositions
6
 
6.2
Citizenship of Members
6
       
ARTICLE 7 MANAGEMENT
6
 
7.1
Management Under Direction of the Board
6
 
7.2
Board of Directors
8
 
7.3
Officers
11
 
7.4
Members
15
 
7.5
No Fiduciary Duties
15
 
7.6
Amendment, Modification or Repeal
16

 
-i-

 

ARTICLE 8 OLD PRE-EFFECTIVE TIME LIMITATION OF LIABILITY AND INDEMNIFICATION
16
 
8.1
Exculpation
16
 
8.2
Right to Indemnification
17
 
8.3
Limitations
18
 
8.4
Advance Payment
18
 
8.5
Pre-Effective Time Indemnification of Officers, Employees and Agents
18
 
8.6
Appearance as a Witness
18
 
8.7
Nonexclusivity of Rights
19
 
8.8
Insurance
19
 
8.9
Member Notification
19
 
8.10
Savings Clause
19
       
ARTICLE 9 OLD POST-EFFECTIVE TIME LIMITATION OF LIABILITY AND INDEMNIFICATION
19
 
9.1
Limitation of Liability and Indemnification of the Covered Persons
19
 
9.2
Indemnification of the Management Covered Persons
23
 
9.3
Advance of Expenses
23
 
9.4
Procedure for Indemnification
24
 
9.5
Contract Right; Non-Exclusivity; Survival
24
 
9.6
Insurance
24
 
9.7
Interpretation; Severability
25
       
ARTICLE 10 CERTAIN AGREEMENTS OF THE COMPANY AND MEMBERS
25
 
10.1
Financial Reports and Access to Information
25
 
10.2
Maintenance of Books
25
 
10.3
Accounts
26
       
ARTICLE 11 TAXES
26
 
11.1
Tax Returns
26
 
11.2
Tax Partnership
26
       
ARTICLE 12 DISSOLUTION, WINDING-UP AND TERMINATION
26
 
12.1
Dissolution
26
 
12.2
Winding-Up and Termination
26
 
12.3
Certificate of Cancellation
27
       
ARTICLE 13 GENERAL PROVISIONS
27
 
13.1
Offset
27
 
13.2
Notices
28
 
13.3
Entire Agreement; Supersedure
28
 
13.4
Effect of Waiver or Consent
28
 
13.5
Amendment or Restatement
28
 
13.6
Binding Effect
28
 
13.7
Governing Law; Severability; Limitation of Liability
29
 
13.8
Further Assurances
30
 
13.9
Counterparts
30

 
-ii-

 

SECOND AMENDED AND RESTATED
LIMITED LIABILITY COMPANY AGREEMENT
OF
GENESIS ENERGY, LLC
a Delaware limited liability company

This SECOND AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT OF GENESIS ENERGY, LLC, a Delaware limited liability company (the “ Company ”), dated as of December 28, 2010 (the “ Effective Date ”), and effective as of the Effective Time, is adopted, executed and agreed to, for good and valuable consideration, by Genesis Energy, L.P., a Delaware limited partnership (“ Genesis ”), as the sole Member.

RECITALS

WHEREAS ,   the Company was formed as a Delaware limited liability company under the Act upon the conversion of Genesis Energy, Inc., a Delaware corporation, into a Delaware limited liability company (the “ Conversion ”), effective on December 29, 2008.  In connection with the Conversion, the Company and Denbury Gathering & Marketing, Inc. (“ DGM ”) entered into that certain Limited Liability Company Agreement of the Company, effective as of December 29, 2008, which was subsequently amended by that certain First Amendment to Limited Liability Company Agreement of the Company, dated December 31, 2008 (as amended, the “ Original LLC Agreement ”);

WHEREAS , pursuant to that certain Purchase Agreement, dated as of December 17, 2009, as amended by that certain First Amendment to Purchase Agreement, dated as of February 5, 2010, by and among Denbury Resources, Inc., DGM, and Q Genesis Acquisition, LLC, a Delaware limited liability company (“ QGA ”), QGA purchased all of the outstanding Class A Ownership Interests of the Company (this and other capitalized references to ownership interests used but not defined in the recitals have the respective meanings assigned to such terms in the organizational documents of the applicable entity in effect at the applicable time), QGA was admitted as a member of the Company and DGM ceased to be a member of the Company (the “ Acquisition ”);

WHEREAS , in connection with the Acquisition, certain of the Class B Ownership Interests of the Company were redeemed by the Company for cash;

WHEREAS , pursuant to that certain Agreement and Plan of Merger, dated as of February 5, 2010, between QGA and the Company, QGA was merged with and into the Company (the “ QGA Merger ”), with the separate existence of QGA ceasing, and the Company continued as the surviving entity under the laws of the State of Delaware (the “ Surviving Entity ”);

WHEREAS , pursuant to the QGA Merger, (i) all Class A Units of QGA outstanding immediately prior to the QGA Merger were converted into Series A Units of the Surviving Entity, (ii) all Class B Ownership Interests of the Company outstanding immediately prior to the Merger were converted into Series A Units of the Surviving Entity, (iii) all Class A Ownership Interests of the Company outstanding immediately prior to the QGA Merger were cancelled for no consideration, and (iv) the members of QGA became members of the Company;

 
 

 

WHEREAS , in connection with the Acquisition and QGA Merger, an amendment and restatement to the Original LLC Agreement was entered into on February 5, 2010, which was subsequently amended by that certain Amendment No. 1 to Amended and Restated Limited Liability Company Agreement of the Company, dated as of June 11, 2010, and that certain Amendment No. 2 to Amended and Restated Limited Liability Company Agreement of the Company, dated as of June 29, 2010 (as amended, the “ First Amended and Restated LLC Agreement ”);

WHEREAS , on the date hereof, in connection with the consummation of the matters contemplated by that certain Agreement and Plan of Merger, dated as of December 28, 2010, by and among Genesis, the Company, and Genesis Acquisition, LLC (“ MergerCo ”), a Delaware limited liability company and a wholly-owned subsidiary of Genesis (the “ Merger Agreement ”), MergerCo will, subject to the terms and conditions set forth therein, merge with and into the Company, with the Company being the surviving entity (the “ Merger ”), such that following the Merger, Genesis will be the sole member of the Company and the Company will be the sole general partner of Genesis; and

WHEREAS , in connection with the Merger, Genesis now desires to execute this Second Amended and Restated Limited Liability Company Agreement (this “ Agreement ”), thereby amending and restating the First Amended and Restated LLC Agreement in its entirety.

NOW, THEREFORE , for good and valuable consideration, the parties to this Agreement hereby amend and restate the First Amended and Restated LLC Agreement as follows:

ARTICLE 1
DEFINITIONS AND CONSTRUCTION

1.1            Definitions .  Capitalized terms used in this Agreement (including the Exhibits and Schedules hereto) but not defined in the body hereof are defined in Exhibit A .

1.2            Construction .  Unless the context requires otherwise:  (a) pronouns in the masculine, feminine and neuter genders shall be construed to include any other gender, and words in the singular form shall be construed to include the plural and vice versa; (b) the term “including” shall be construed to be expansive rather than limiting in nature and to mean “including, without limitation;” (c) references to Articles and Sections refer to Articles and Sections of this Agreement; (d) the words “this Agreement,” “herein,” “hereof,” “hereby,” “hereunder” and words of similar import refer to this Agreement as a whole, including the Exhibits and Schedules attached hereto, and not to any particular subdivision unless expressly so limited; (e) all references to “shall” mean “will;” and (f) references to Exhibits and Schedules are to the items identified separately in writing by the parties hereto as the described Exhibits or Schedules attached to this Agreement, each of which is hereby incorporated herein and made a part hereof for all purposes as if set forth in full herein.

 
2

 

ARTICLE 2
ORGANIZATION

2.1            Formation and Continuation of the Company .  The Company is a limited liability company organized under the Act.  The Company became a limited liability company upon the Conversion which was effective on December 29, 2008.  Effective upon the execution of this Agreement, the First Amended and Restated LLC Agreement shall be amended and restated by this Agreement, and the rights, duties and liabilities of Genesis shall be as provided in this Agreement.  Genesis hereby agrees to continue the Company as a limited liability company under this Agreement and pursuant to the Act without dissolution.

2.2            Name .  The name of the Company is “ GENESIS ENERGY, LLC ” and all Company business must be conducted in that name or such other name or names that comply with Law and as the Board may select.

2.3            Registered Office; Registered Agent; Principal Office; Other Offices .  The Company’s registered agent is Corporation Trust Company, or such other Person or Persons as the Board may designate in the manner provided by Law.  The office of the registered agent is at Corporation Trust Center, 1209 Orange Street, Wilmington, New Castle County, Delaware, 19501, or such other office (which need not be a place of business of the Company) as the Board may designate in the manner provided by Law.  The principal office of the Company shall be 919 Milam, Suite 2100, Houston, Texas or at such other place or places as the Board may designate.  The Company may have such other offices as the Board may designate.

2.4            Purposes .  The Company’s purposes are (i) for so long as it is the general partner of Genesis, to act as a general partner or managing member, as the case may be, of Genesis and, if applicable, Genesis Crude Oil, L.P., and any other partnership or limited liability company of which Genesis or Genesis Crude Oil, L.P. is, directly or indirectly, a partner or member, and (ii) to undertake activities that are ancillary to the above (including being a limited partner or member in any such other partnership or limited liability company), and in connection therewith to engage in any lawful act, activity and/or business for which limited liability companies may be organized under the Act.

2.5            Term .  The Company was formed as a result of the Conversion.  Pursuant to the Act, the Company commenced its existence on September 4, 1996, which is the date that Genesis Energy, LLC, the Company’s original predecessor entity, commenced its existence.  The Company shall have perpetual existence, unless and until it is dissolved and terminated in accordance with ARTICLE 12 .

2.6            No State Law Partnership .  The Members intend that the Company not be a partnership (including a limited partnership) or joint venture, and that no Member be a partner or joint venturer of any other Member, for any purposes other than federal and state tax purposes, and this Agreement may not be construed to suggest otherwise.

2.7            Title to Company Assets .  Title to the Company’s assets, whether real, personal or mixed and whether tangible or intangible, shall be deemed to be owned by the Company as an entity.  Title to any or all of the Company assets may be held in the name of the Company or one or more of its Affiliates or one or more nominees, as the Board may determine.  All Company assets shall be recorded as the property of the Company in its books and records, irrespective of the name in which record title to such Company assets is held.

 
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ARTICLE 3
MEMBERSHIP INTERESTS; MEMBERS

3.1            Members .  The Person listed on Schedule I , as of the Effective Time, is hereby admitted to the Company as a Member and owns a Membership Interest in the Company as reflected in such Schedule I .  The Officers shall amend and revise Schedule I from time to time to properly reflect any changes to the information set forth therein, including to reflect the admission or withdrawal of Members.  Any amendment or revision to Schedule I or to the Company’s records to reflect information regarding Members shall not be deemed to be an amendment to this Agreement.  The rights and obligations of the Members shall be as provided in the Act, except as may be expressly provided in this Agreement.

3.2            Admission of Additional Members and Substituted Members and Creation of Additional Membership Interests .  Subject to the limitations set forth in this ARTICLE 3 and in ARTICLE 6 , the Company may admit Additional Members and Substituted Members to the Company and/or create and issue such additional classes or series of Membership Interests (or securities convertible into or exercisable or exchangeable for a Membership Interest), having such designations, preferences and relative, participating or other special rights, powers and duties as the Board shall determine, including:  (i) the right of any such series or type of Membership Interests to share in the Company’s distributions; (ii) the rights of any such series or type of Membership Interests upon dissolution or liquidation of the Company; and (iii) the right of any such series or type of Membership Interests to vote on matters relating to the Company and this Agreement.  Upon the issuance pursuant to and in accordance with this ARTICLE 3 of any series or type of Membership Interests, the Board may, subject to Section 13.5 , amend any provision of this Agreement, and authorize any Person to execute, acknowledge, deliver, file and record, if required, such documents, to the extent necessary or desirable to reflect the admission of any additional Member to the Company or the authorization and issuance of such series or type of Membership Interests (or securities convertible into or exercisable or exchangeable for a Membership Interest), and the related rights and preferences thereof.

3.3            No Liability of Members .  Except as otherwise provided under the Act, the debts, liabilities, contracts and other obligations of the Company (whether arising in contract, tort or otherwise) shall be solely the debts, liabilities, contracts and other obligations of the Company, and no Member shall be liable personally (a) for any debts, liabilities, contracts or any other obligations of the Company, except to the extent and under the circumstances set forth in the Act, or (b) for any debts, liabilities, contracts or other obligations of any other Member.  Except as otherwise provided in the Act, this Agreement or in any separate written instrument signed by the applicable Member, no Member shall be obligated personally for any debt, obligation or liability of the Company or of any other Member solely by reason of being a Member.  No Member shall have any responsibility to contribute to or in respect of the liabilities or obligations of the Company or to return distributions made by the Company, except as expressly provided herein or required by the Act.  The agreement set forth in the immediately preceding sentence shall be deemed to be a compromise with the consent of all of the Members for purposes of Section 18-502(b) of the Act.  However, if any court of competent jurisdiction orders, holds or determines that, notwithstanding the provisions of this Agreement, any Member is obligated to restore any such negative balance, make any such contribution or make any such return, such obligation shall be the obligation of such Member and not of any other Person.

 
4

 

ARTICLE 4
CAPITAL CONTRIBUTIONS

4.1            Capital Contributions .  Genesis shall not be obligated to make any Capital Contributions except as provided in this ARTICLE 4 .

4.2            Return of Contributions .  A Member is not entitled to the return of any part of its Capital Contributions or to be paid interest in respect of its Capital Contributions.  An unrepaid Capital Contribution is not a liability of the Company or of any Member.  A Member is not required to contribute or to lend any cash or property to the Company to enable the Company to return any Member’s Capital Contributions.

4.3            Advances by Members .  If the Company does not have sufficient cash to pay its obligations, then with the approval of the Board, any or all of the Members may (but will have no obligation to) advance all or part of the needed funds to or on behalf of the Company, which advances (a) will constitute a loan from such Member to the Company, (b) will bear commercially reasonable interest and be subject to such other commercially reasonable terms and conditions as agreed between such Member and the Company and (c) will not be deemed to be a Capital Contribution by such Member to the Company.

ARTICLE 5
DISTRIBUTIONS

5.1            Distributions .

(a)            Each distribution made by the Company, regardless of the source or character of the assets to be distributed, shall be made in accordance with this ARTICLE 5 and applicable Law.

(b)            An amount equal to 100% of Available Cash with respect to each fiscal quarter of the Company shall be distributed to the Members in accordance with this Section 5.1 within sixty (60) days after the end of each such quarter.

(c)            The Company is authorized to withhold from distributions, or with respect to allocations, to the holders of Membership Interests and to pay over to any federal, state, local or foreign government any amounts required to be so withheld pursuant to the Code or any provisions of any applicable Law.  For all purposes under this Agreement, any amount so withheld shall be treated as actually distributed to the holder with respect to which such amount was withheld.

 
5

 

ARTICLE 6
DISPOSITION OF MEMBERSHIP INTERESTS

6.1            Restrictions On Dispositions .

(a)            Disposition of Membership Interests otherwise permitted or required by this Agreement may only be made in compliance with federal and state securities laws, including the Securities Act and the rules and regulations thereunder, and the Act.

(b)            Dispositions of Membership Interests may only be made in strict compliance with this ARTICLE 6 and any purported Disposition of Membership Interests that does not so comply with this ARTICLE 6 shall be null and void and of no force or effect, and the Company shall not recognize or be bound by any such purported Disposition and shall not effect any such purported Disposition on the transfer books of the Company.  The Members agree that the restrictions contained in this ARTICLE 6 are fair and reasonable and in the best interests of the Company and the Members.

(c)            Notwithstanding anything contained herein, no Disposition of any Membership Interests may be made by any transferee to any Person, if in the reasonable determination of the Board, such Disposition would result in either (x) more than a minority of all outstanding Membership Interests being held (of record or beneficially) or (y) more than 25% of all outstanding Membership Interests being held of record, in the case of both (x) and (y), by Persons who are not United States citizens within the meaning of the Jones Act, if at the time of such proposed Disposition the Company, or any of its Subsidiaries, are then engaged in the operation of vessels in the United States within the meaning of the Jones Act.

6.2            Citizenship of Members .  No less than thirty (30) days prior to any Member or transferee who on the date hereof is a United States citizen, within the meaning of the Jones Act, becoming a non-United States citizen, either voluntarily or otherwise, such Person must provide written notice to the Company of such proposed change in citizenship.  If in the determination of the Board such Member’s change in citizenship would be detrimental to the Company, its Subsidiaries or Affiliates, the Company may redeem the Membership Interests or a portion thereof held by such Member or transferee at fair market value as determined by the Board in its reasonable judgment in such amounts as would no longer cause a violation of the Jones Act.

ARTICLE 7
MANAGEMENT

7.1            Management Under Direction of the Board .

(a)             General Scope .  The business and affairs of the Company shall be managed and controlled by a board of managers (the “ Board ,” and each member of the Board, a “ Director ”), and, subject to the terms and conditions of this Agreement, the Board shall have full and complete discretion to manage and control the business and affairs of the Company, to make all decisions affecting the business and affairs of the Company and to take all such actions as it deems necessary or appropriate to accomplish the purposes of the Company as set forth herein.  Notwithstanding the foregoing, no Director in his or her individual capacity shall have the authority to manage the Company or approve matters relating to, or otherwise to bind the Company, such powers being reserved to all of the Directors acting pursuant to Section 7.2 through the Board and to such agents of the Company as designated by the Board.  Neither the Directors nor the officers of the Company have authority to take any action in contravention of the Genesis Agreement.

 
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(b)             Specific Powers; Delegation .

(i)             The Directors are authorized on the Company’s behalf, and in all cases subject to the restrictions imposed on the Company as the general partner of Genesis by the Genesis Agreement, to make all decisions as to the acquisition, financing, maintenance, holding and disposition of the Company’s assets (the “ Company Property ”), and in connection therewith are authorized on the Company’s behalf, and subject to the terms of this Agreement, to make all decisions as to (A) the development, sale, lease or other disposition of the Company Property; (B) the purchase or other acquisition of other assets of all kinds; (C) the management of all or any part of the Company Property and the  business of the Company; (D) the borrowing of money and the granting of security interests in the Company Property (including loans from Members); (E) the prepayment, refinancing or extension of any security interest affecting the Company Property; (F) the compromise or release of any of the Company’s claims or debts; (G) the employment of persons, firms or corporations for the operation and management of the Company’s business; and (H) determination of the amount of Available Cash and the amount and timing of distributions to Members.

(ii)            The Directors are authorized on the Company’s behalf in its capacity as the general partner of Genesis, to make all decisions regarding the conduct, direction and management of all activities of Genesis, and regarding the exercise of all management powers over the business and affairs of Genesis, in accordance with the terms of the Genesis Agreement.  In this regard, the Directors are authorized on the Company’s behalf, in its capacity as general partner of Genesis, and subject to any restrictions contained in the Genesis Agreement, to make all decisions regarding exercise of the powers now or hereafter granted a general partner of a limited partnership under applicable Law or that are granted to the general partner of Genesis under the various provision of the Genesis Agreement, and to make all decisions related to the exercise of full power and authority to do all things, on such terms as the Directors in their sole discretion deem necessary or appropriate, to conduct the business of Genesis, including decisions related to (A) exercise of all powers set forth in Section 2.5 of the Genesis Agreement, (B) effectuating the purposes set forth in Section 2.4 of the Genesis Agreement and (C) the matters specifically listed in Section 7.2 of the Genesis Agreement.

(iii)           The Directors may delegate to the officers of the Company the authority to conduct the day to day business and operations of the Company and Genesis, including the authority, on behalf of the Company acting both in its own capacity and in the capacity of the general partner of Genesis, to execute and deliver (A) all contracts, conveyances, assignments, leases, subleases, franchise agreements, licensing agreements, management contracts and maintenance contracts covering or affecting the Company Property and the assets of Genesis (“ Genesis Property ”); (B) all checks, drafts and other orders for the payment of the Company’s funds and Genesis’ funds; (C) all promissory notes, mortgages, deeds of trust, security agreements and other similar documents; (D) all articles, certificates and reports pertaining to the Company’s or Genesis’ organization, qualification and dissolution; (E) all tax returns and reports; (F) all documents necessary to acquire Company Property and Genesis Property; and (G) all other instruments of any kind or character relating to the conduct of the Company’s or Genesis’ day to day business and operations.

 
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(iv)           Notwithstanding any other provision of this Agreement to the contrary, this ARTICLE 7 and Section 13.4(b) of the Genesis Agreement (or Section 13.11 of the Genesis Agreement to the extent related thereto) shall, in all instances, be subject to the provisions of the Unitholder Rights Agreement.

7.2            Board of Director s .

(a)             Qualifications .  A Director need not be a Member.  At least a majority of the Directors must be United States citizens within the meaning of the Jones Act.  No more than a minority of the Board members necessary to constitute a quota may be elected, appointed or otherwise designated by Members who are not U.S. citizens within the meaning of the Jones Act.  A Director need not be a Member or a Limited Partner.  The members of the Board shall be “Managers” within the meaning of the Act.

(b)             Adoption of Section 13.4(b) of the Genesis Agreement .

(i)             Subject to Section 11.3 of the Genesis Agreement, Genesis and the Company hereby adopt as part of the terms of this Agreement, and agree to be bound by, Section 13.4(b) of the Genesis Agreement (and Section 13.11 of the Genesis Agreement to the extent related thereto) as if such section were set forth in full herein and hereby delegate to the holders of Common Units – Class B the right to elect (and to the extent applicable, nominate) the Directors in accordance with Section 13.4(b) of the Genesis Agreement (together with all related rights set forth therein).  Such delegation shall not cause Genesis to cease to be a member of the Company and shall not constitute a delegation of any other rights, powers, privileges or duties of Genesis with respect to the Company.  At such time as all Common Units – Class B have converted to Common Units – Class A (as defined in the Genesis Agreement), the Directors shall be appointed, replaced and removed (subject to the Unitholder Rights Agreement) by Genesis, as the sole Member, unless otherwise provided at the time of conversion or anytime thereafter.

(ii)            The holders of Common Units – Class B shall not, as a result of exercising the rights granted under Section 13.4(b) of the Genesis Agreement (and Section 13.11 of the Genesis Agreement to the extent related thereto), be deemed to be Members or holders of Membership Interests as such terms are defined in this Agreement or to be “members,” “managers” or holders of “limited liability company interests” as such terms are defined in the Act.  The exercise by a holder of Common Units – Class B of the right to elect Directors and any other rights afforded to such Limited Partner hereunder and under Section 13.4(b) of the Genesis Agreement (and Section 13.11 of the Genesis Agreement to the extent related thereto) shall be in such Limited Partner’s capacity as a limited partner of Genesis, and no Limited Partner shall be liable for any debts, obligations or liabilities of the Company by reason of the foregoing.

 
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(iii)           Subject to Section 11.3 of the Genesis Agreement, the Members, the Directors and the Company shall use their commercially reasonable best efforts to take such action as shall be necessary or appropriate to give effect to and implement the provisions of Section 13.4(b) of the Genesis Agreement (and Section 13.11 of the Genesis Agreement to the extent related thereto) as adopted in this Section 8.2(b).

(c)             Number of Directors . Subject to the Unitholders Rights Agreement, the number of Directors on the Board of Directors shall be 11, unless otherwise fixed from time to time pursuant to a resolution adopted by a majority of the Directors then in office.  Each person serving as a Director immediately prior to the effectiveness of this Agreement shall continue as a Director.

(d)             Chairman of the Board .  The Chairman of the Board of Directors, which will be a position held as a Director and will not be deemed an officer of the Company will, subject to Section 11.3 of the Genesis Agreement, be appointed pursuant to Section 13.4(b) of the Genesis Agreement and selected by the Directors so appointed unless designated by the majority holders of the Common Units – Class B.  The Chairman of the Board will preside at all meetings of the Members or of the Directors at which he may be present, and will have such other duties, powers and authority as may be prescribed by this Agreement, or by resolutions adopted by the Directors and which he accepts.  The Chairman of the Board must be a United States citizen within the meaning of the Jones Act.

(e)             Time Devoted to Business .  The Directors shall devote only the amount of time to the Company’s activities as is reasonably necessary to discharge the Directors’ responsibilities.

(f)             Removal .  A Director may be removed with or without cause as, subject to Section 11.3 of the Genesis Agreement, provided in the Genesis Agreement.

(g)             Resignations .  A Director may resign at any time.  Such resignation shall be in writing and shall take effect at the time specified therein or, if no time is specified, at the time of its receipt by the Company.  The acceptance of a resignation shall not be necessary to make it effective unless expressly so provided in the resignation.

(h)             Vacancies .  In the event that a vacancy is created on the Board by the death, disability, retirement, resignation or removal of any Director, such vacancy shall be filled as provided in the Genesis Agreement, subject to Section 11.3 of the Genesis Agreement.

(i)              Quorum; Required Vote for Board Action .  Unless otherwise required or permitted by this Agreement, a majority of Directors, either present (in person or by teleconference) or represented by proxy, shall constitute a quorum for the transaction of business at a meeting of the Board, and actions by the Board shall require the vote or consent of a majority of Directors present at the meeting at which a quorum is present.  Each Director shall have one vote.

 
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(j)              Place of Meetings; Order of Business .  The Board may hold its meetings and may have an office and keep the books of the Company, except as otherwise provided by Law, in such place or places, within or without the State of Delaware, as the Board may from time to time determine by resolution.  At all meetings of the Board, business shall be transacted in such order as shall from time to time be determined by the by resolution of the Board.

(k)             Regular Meetings .  The Board shall hold regular meetings of the Board at least four (4) times each calendar year, at such times and places as shall be designated from time to time by resolution of the Board.  Notice of such regular meetings shall not be required.

(l)              Special Meetings .  Special meetings of the Board may be called by the Chairman of the Board, the Chief Executive Officer or any two (2) Directors, on at least forty-eight (48) hours personal, written, telegraphic, cable, wireless or electronic notice to each Director, which notice must include appropriate dial-in information to permit each Director to participate in such meeting by means of telephone conference.  Such notice need not state the purpose or purposes of, or business to be transacted at, such meeting, except as may otherwise be required by Law.

(m)            Compensation .  The Directors not employed by the Company may receive compensation for serving on the Board as approved by the Board.  All of the Directors shall be entitled to reimbursement for reasonable out-of-pocket expenses in attending meetings of the Board.

(n)             Action Without a Meeting .  Any action required or permitted to be taken at any meeting of the Board may be taken without a meeting if a consent in writing, setting forth the action so taken, shall be signed by Directors having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all Directors entitled to vote thereon were present and voted.  The Board shall deliver a copy of the written consent to all of the Directors prior to such action being taken.  Prompt notice of the taking of the action without a meeting by less than a unanimous written consent shall be given by the Company to those Directors who have not consented in writing, and the writing or writings shall be filed with the minutes of proceedings of the Board.

(o)             Telephonic Conference Meeting .  Subject to the requirement for notice of meetings, members of the Board shall have a right to participate in any meeting by means of a conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and participation in such a meeting shall constitute presence in person at such meeting, except where a person participates in the meeting for the express purpose of objecting to the transaction of any business on the ground that the meeting is not lawfully called or convened.

(p)             Waiver of Notice Through Attendance .  Attendance of a Director at any meeting of the Board (including by telephone) shall constitute a waiver of notice of such meeting, except where such Director attends the meeting for the express purpose of objecting to the transaction of any business on the ground that the meeting is not lawfully called or convened and notifies the other Directors at such meeting of such purpose.

 
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(q)             Reliance on Books, Reports and Records .  Each Director shall, in the performance of his or her duties, be fully protected in relying in good faith upon the books of account, opinions reports or statements made to the Company by any of its Officers or by an independent certified public accountant or by an appraiser selected with reasonable care by the Board or any other Person pertaining to matters the Directors reasonably believe to be within the Person’s expertise or competence, or in relying in good faith upon other records of the Company.

(r)             Committees of Directors; Delegation of Authority to Individual Director .  The Directors may designate one or more committees, each of which shall be comprised of one or more Directors, and may designate one or more of the Directors as alternate members of any committee.  Except for matters that cannot be delegated to such a committee according to this Agreement, any such committee, to the extent provided in the resolution establishing it, shall have and may exercise all of the authority that may be exercised by the Directors.  Regular and special meetings of such committee shall be held in the manner designated by the Directors or, if not so designated, by such committee.  The Directors may dissolve any committee at any time.  In addition, the Directors may delegate to one or more Directors such authority and duties, and assign to them such titles, as the Directors may deem advisable.  Any such delegation may be revoked at any time by the Directors.  A majority of the members of a committee will constitute a quorum at a meeting of the committee.  No action may be taken absent a quorum.  At any meeting of a committee the act of a majority of the members who are present at such meeting at which a quorum is present will be the act of the committee.

(s)             Conflicts Committee .  The Directors will designate a Conflicts Committee composed entirely of three or more Independent Directors.  The Conflicts Committee shall perform such functions as may be appropriate, including meeting for the purpose of deciding on whether or not to grant a Special Approval pursuant to the terms of the Genesis Agreement.

(t)              Audit Committee .  The Directors shall designate an Audit Committee composed entirely of three or more Independent Directors.  The Audit Committee shall establish a written audit committee charter in accordance with the rules of the New York Stock Exchange as amended from time to time.

7.3            Officers .

(a)             Generally .

(i)             The Company may have such officers (the “ Officers ”) as the Board in its discretion may appoint including a Chief Executive Officer, a President, one or more Vice Presidents, a Secretary, a Treasurer, one or more Assistant Secretaries, and on or more Assistant Treasurers.  The Directors may, if they desire, elect or appoint additional officers as may be deemed necessary, and may further identify or describe the rights and duties of any one or more of the officers of the Company.  The Board shall not be responsible for any misconduct or negligence on the part of any such Officer appointed in good faith.  Any such Officers may, subject to the general direction of the Board, have responsibility for the management of the normal and customary day-to-day operations of the Company, and act as “ agents ” of the Company in carrying out such activities.  Any Officer may resign at any time.  Such resignation shall be in writing and shall take effect at the time specified therein or, if no time is specified, at the time of its receipt by the Board.  The acceptance of a resignation shall not be necessary to make it effective unless expressly so provided in the resignation.

 
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(ii)            The Officers need not be Members, Directors or residents of the State of Delaware.  Any two or more offices may be held by the same person.  An officer shall be deemed qualified when he enters upon the duties of the office to which he has been elected or appointed and furnishes any bond required by the Directors; but the Directors also may require his written acceptance and promise faithfully to discharge the duties of such office.

(iii)           Subject to the rights and obligations contained in any employment or similar agreement between the Company and an Officer, each Officer shall hold his office at the pleasure of the Directors or for such other period as the Directors may specify by agreement or otherwise at the time of his election or appointment, or until his death, resignation, replacement or removal by the Directors, whichever first occurs.

(iv)           The Directors from time to time also may appoint such other agents for the Company as they shall deem necessary or advisable, each of whom shall serve at the pleasure of the Directors or for such period as the Directors may specify, and shall exercise such powers, have such titles and perform such duties as shall be determined from time to time by the Directors or by an officer empowered by the Directors to make such determinations.

(b)             Removal .  The Board may remove any Officer or agent or member of a committee, and any employee, with or without cause at any time; provided, however , that such removal shall be without prejudice to the contractual rights, if any, of the Officer so removed.  Election or appointment of an Officer shall not of itself create contract rights.

(c)             Compensation .  The Officers shall receive compensation for their services as approved by the Directors.  To the extent the officers shall incur out-of-pocket costs and expenses in the course of their service hereunder, including the portion of their overhead reasonably allocable to Company activities, the officers shall be reimbursed for such costs and expenses by the Company.

(d)             Delegation of Authority to Hire, Discharge and Designate Duties .  The Directors from time to time may delegate to the Chief Executive Officer or other officer or executive employee of the Company, authority to hire, discharge, and fix and modify the duties, salary or other compensation of, employees of the Company under their jurisdiction, and the Directors may delegate to such officer or executive employee similar authority with respect to obtaining and retaining for the Company the services of attorneys, accountants, and other experts.

 
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(e)             Chief Executive Officer .  In the absence of the Chairman of the Board, the Chief Executive Officer shall preside at all meetings of the Members or of the Directors at which he may be present.  The Chief Executive Officer shall have such other duties, powers, and authority as may be prescribed in this Agreement or by resolutions adopted by the Directors.  The Directors may delegate such other authority and assign such additional duties to the Chief Executive Officer, other than those conferred by law exclusively upon the President, as they may from time to time determine, and, to the extent permissible by law, the Directors may confer on the Chief Executive Officer all of the powers otherwise conferred upon the President of the Company under Section 7.3(f) of this Agreement, or they may, from time to time, divide the responsibilities, duties, and authority for the general control and management of the Company’s business and affairs between the Chief Executive Officer and the President.  The Chief Executive Officer must be a United States citizen within the meaning of the Jones Act.

(f)             President .  Subject to any resolutions adopted by the Directors regarding the duties, powers and authority of the President, the President shall have such general executive powers and duties of supervision and management as usually are vested in the office of the president of a corporation, and he shall carry into effect all directions and resolutions of the Directors.  The President, in the absence of the Chairman of the Board and the Chief Executive Officer, shall preside at all meetings of the Members or of the Directors. Without limiting the generality of the foregoing:

(i)             The President may execute all bonds, notes, debentures, mortgages, and other contracts requiring a seal, under the seal of the Company, may cause the seal to be affixed thereto, and may execute all other instruments for and in the name of the Company.

(ii)            Unless the Directors otherwise provide, the President, or any person designated in writing by him, may (a) attend meetings of shareholders, partners or members of other companies to represent this Company thereat and to vote or take action with respect to interests of any such company owned by this Company in such manner as he or his designee may determine, and (b) execute and deliver waivers of notice and proxies for and in the name of this Company with respect to interests of any such company owned by this Company.

(iii)           He shall, unless the Directors otherwise provide, be an ex officio member of all standing committees.

(iv)           He shall have such other or further duties and authority as may be prescribed elsewhere in this Agreement or from time to time or by resolutions adopted by the Directors.

(g)             Vice Presidents .  In the absence, disability, or inability or refusal to act of the President, any Vice President may perform the duties and exercise the powers of the President, until the Directors otherwise provide.  Vice Presidents shall perform such other duties and have such other power and authority as shall from time to time be prescribed by resolutions adopted by the Directors.

 
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(h)             The Secretary and Assistant Secretaries .  The Secretary shall attend all sessions of the Directors and all meetings of the Members, shall prepare minutes of all proceedings at such meetings, and shall preserve them in a minute book of the Company.  He shall perform similar duties for the executive and other standing committees when requested by the Directors or any such committee.  He shall see that all books, records, lists, and information, or duplicates, required to be maintained at the registered or other office of the Company in Delaware, or elsewhere, are so maintained.  He shall perform such other duties and have such other responsibility and authority as may be prescribed elsewhere in this Agreement or shall from time to time be prescribed by resolutions adopted by the Directors or by the Chief Executive Officer or President of the Company, under whose direct supervision he shall be.

Any Assistant Secretary, in the absence, disability, or inability or refusal to act of the Secretary, may perform the duties and exercise the powers of the Secretary until the Directors otherwise provide.  Assistant Secretaries shall perform such other duties and have such other authority as the Directors may from time to time prescribe.

(i)              The Treasurer and Assistant Treasurers .  The Treasurer shall have responsibility for the safekeeping of the funds and securities of the Company, shall keep or cause to be kept full and accurate accounts of receipts and disbursements in books belonging to the Company, and shall keep, or cause to be kept, all other books of account and accounting records of the Company.  He shall deposit or cause to be deposited all moneys and other valuable effects in the name and to the credit of the Company in such depositories as may be designated by the Directors or by any officer of the Company to whom such authority has been granted by the Directors.  He shall disburse, or permit to be disbursed, the funds of the Company as may be ordered, or authorized generally, by the Directors, and shall render to the Chief Executive Officer and President of the Company and the Directors, whenever they may require it, an account of all his transactions as Treasurer and of those under his jurisdiction, and of the financial condition of the Company.  He shall perform such other duties and shall have such other responsibility and authority as may be prescribed elsewhere in this Agreement or from time to time by resolutions adopted by the Directors.  Without limiting the generality of the foregoing:

(i)             He shall, unless otherwise provided by the Directors, be the chief financial and accounting officer of the Company.

(ii)            If required by the Directors, he shall give the Company a bond in a sum and with one or more sureties satisfactory to the Directors for the faithful performance of the duties of his office and for the restoration to the Company, in the case of his death, resignation, retirement, or removal from office, of all books, papers, vouchers, money, and other property of whatever kind in his possession or under his control which belong to the Company.

(iii)           Any Assistant Treasurer, in the absence, disability, or inability or refusal to act of the Treasurer, may perform the duties and exercise the powers of the Treasurer until the Directors otherwise provide.  Assistant Treasurers shall perform such other duties and have such other authority as the Directors may from time to time prescribe.

 
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(j)              Duties of Officers May be Delegated .  If any Officer be absent or unable to act, or for any other reason that the Directors may deem sufficient, the Directors may delegate, for the time being, some or all of the functions, duties, powers, and responsibilities of any officer to any other officer, or to any other agent or employee of the Company or other responsible person, provided a majority of all the Directors concurs.

7.4            Members .  The Members in their capacity as such shall not have any power or authority to manage the business or affairs of the Company or to bind the Company or enter into agreements on behalf of the Company.  To the fullest extent permitted by Law and notwithstanding any provision of this Agreement or any Transaction Document, no Member shall have any duty, fiduciary or otherwise, to the Company or any other Member in connection with the business and affairs of the Company or any consent or approval given or withheld pursuant to this Agreement or any Transaction Document.  Except as otherwise expressly provided in this Agreement, Members shall have no voting rights or rights of approval, veto or consent or similar rights over any actions of the Company.  Any matter requiring the consent or approval of any of the Members pursuant to this Agreement shall be taken without a meeting, without prior notice and without a vote, by a consent in writing, setting forth such consent or approval, and signed by the holders of not less than the percentage of outstanding Membership Interests necessary to consent to or approve such action.  Prompt notice of such consent or approval shall be given by the Company to those Members who have not joined in such consent or approval.

7.5            No Fiduciary Duties .  THIS AGREEMENT, IS NOT INTENDED TO, AND DOES NOT, CREATE OR IMPOSE ANY FIDUCIARY DUTY OR LIABILITY ON ANY OF THE MEMBERS OR DIRECTORS OR ANY OTHER PERSON OR ENTITY AFFILIATED WITH ANY OF THE MEMBERS OR DIRECTORS.  SUBJECT TO THE THIRD TO LAST SENTENCE IN THIS SECTION 7.5 , TO THE FULLEST EXTENT PERMITTED BY LAW, AND NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT, THERE SHALL NOT BE ANY DUTY, FIDUCIARY OR OTHERWISE, OWED BETWEEN THE MEMBERS (OR BY A MEMBER TO THE COMPANY), OR BY ANY OF THE DIRECTORS TO THE MEMBERS OR TO THE COMPANY THAT MAY BE IMPOSED BY LAW UPON A DIRECTOR OR MEMBER BY VIRTUE OF SUCH PERSON’S STATUS AS A “MANAGER” OR “MEMBER” (AS SUCH TERMS ARE USED IN THE ACT) OF A DELAWARE LIMITED LIABILITY COMPANY.  SUBJECT TO THE THIRD TO LAST SENTENCE IN THIS SECTION 7.5 , NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT TO THE CONTRARY, EACH OF THE MEMBERS ACKNOWLEDGES AND AGREES THAT EACH MEMBER, IN ITS CAPACITY AS A MEMBER, AND EACH DIRECTOR MAY DECIDE OR DETERMINE ANY MATTER SUBJECT TO THE APPROVAL OF SUCH MEMBER OR ANY SUCH DIRECTOR PURSUANT TO ANY PROVISION OF THIS AGREEMENT IN THE SOLE AND ABSOLUTE DISCRETION OF SUCH MEMBER OR ANY SUCH DIRECTOR, AND IN MAKING SUCH DECISION OR DETERMINATION SUCH MEMBER OR ANY SUCH DIRECTOR SHALL HAVE NO DUTY, FIDUCIARY OR OTHERWISE, TO ANY OTHER MEMBER OR TO THE COMPANY, IT BEING THE INTENT OF ALL MEMBERS THAT SUCH MEMBER, IN ITS CAPACITY AS A MEMBER, AND EACH DIRECTOR HAVE THE RIGHT TO MAKE SUCH DETERMINATION SOLELY ON THE BASIS OF ITS OWN INTERESTS OR THE INTERESTS OF THE MEMBER(S) THAT DESIGNATED SUCH DIRECTOR.  EACH OF THE COMPANY AND THE MEMBERS HEREBY AGREES THAT ANY CLAIMS AGAINST, ACTIONS, RIGHTS TO SUE, OTHER REMEDIES OR OTHER RECOURSE TO OR AGAINST THE MEMBERS OR ANY OF THEIR RESPECTIVE AFFILIATES, AND EACH DIRECTOR, FOR OR IN CONNECTION WITH ANY SUCH DECISION OR DETERMINATION, IN EACH CASE WHETHER ARISING IN COMMON LAW OR EQUITY OR CREATED BY RULE OF LAW, STATUTE, CONSTITUTION, CONTRACT (INCLUDING THIS AGREEMENT) OR OTHERWISE, ARE IN EACH CASE EXPRESSLY RELEASED AND WAIVED BY THE COMPANY AND EACH MEMBER, TO THE FULLEST EXTENT PERMITTED BY LAW, AS A CONDITION OF, AND AS PART OF THE CONSIDERATION FOR, THE EXECUTION OF THIS AGREEMENT AND ANY RELATED AGREEMENT, AND THE INCURRING BY THE MEMBERS OF THE OBLIGATIONS PROVIDED IN SUCH AGREEMENTS.  NOTHING HEREIN SHALL BE DEEMED TO ALTER THE CONTRACTUAL OBLIGATIONS OF A MEMBER TO ANOTHER MEMBER OR TO THE COMPANY PURSUANT TO THIS AGREEMENT.  IN MAKING SUCH EXPRESS WAIVER OF FIDUCIARY DUTIES, THE MEMBERS RECOGNIZE, ACKNOWLEDGE AND AGREE THAT THE PROVISIONS OF THIS AGREEMENT, TO THE EXTENT THAT THEY RESTRICT OR ELIMINATE THE DUTIES OR LIABILITIES OF A PARTICULAR PERSON OTHERWISE EXISTING AT LAW OR IN EQUITY, REPLACE SUCH DUTIES AND LIABILITIES EXISTING AT LAW OR IN EQUITY OF SUCH PERSON.  NOTHING CONTAINED IN THIS SECTION 7.5 IS INTENDED TO, OR SHALL, ELIMINATE, REDUCE OR ALTER IN ANY FASHION ANY FIDUCIARY OR OTHER DUTIES (IF ANY) OWED BY THE INDEPENDENT DIRECTORS TO HOLDERS OF THE EQUITY (OTHER THAN THE HOLDERS OF THE GENERAL PARTNER INTEREST) OF GENESIS, WHICH DUTIES, IF ANY, ARE INTENDED TO BE GOVERNED BY THE GENESIS AGREEMENT, AS CURRENTLY OR SUBSEQUENTLY AMENDED, TO THE EXTENT APPLICABLE.  NOTWITHSTANDING ANY OTHER TERMS OF THIS AGREEMENT, WHETHER EXPRESS OR IMPLIED, OR ANY OBLIGATION OR DUTY AT LAW OR IN EQUITY, AND, TO THE FULLEST EXTENT PERMITTED BY LAW, NONE OF THE DIRECTORS SHALL BE LIABLE TO THE COMPANY, ANY MEMBER OR ANY OTHER PERSON FOR ANY BREACH OF ANY FIDUCIARY OR OTHER DUTIES, WHETHER OR NOT CONTAINED IN THE GENESIS AGREEMENT.  NOTHING IN THIS SECTION 7.5 SHALL CREATE ANY DUTY OR LIABILITY THAT DOES NOT EXIST AT LAW OR IN EQUITY.

 
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7.6            Amendment, Modification or Repeal .  Any amendment, modification or repeal of the second sentence of Section 7.4 or of Section 7.5 or any provision thereof shall be prospective only and shall not in any way affect the limitations on the liability under such provisions as in effect immediately prior to such amendment, modification or repeal with respect to claims arising from or relating to matters occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of when such claims may arise or be asserted.

ARTICLE 8
OLD PRE-EFFECTIVE TIME LIMITATION OF LIABILITY AND INDEMNIFICATION

8.1            Exculpation .  Directors and officers of the Company shall not be liable to the Company or its Members for monetary damages for an act or omission in the Director’s capacity as a Director or the officer’s capacity as an officer, as the case may be, relating to any action or omission occurring prior to the Old Effective Time except that this Section does not eliminate or limit the liability of a Director or officer to the extent the Director or officer is found liable for (i) an act or omission occurring prior to the Old Effective Time not in good faith that involves intentional misconduct or a knowing violation of the law; (ii) a transaction occurring prior to the Old Effective Time from which the Director or officer received an improper benefit, whether or not the benefit resulted from an action taken within the scope of the respective Director’s or officer’s office; or (iii) an act or omission occurring prior to the Old Effective Time for which the liability of a Director or officer is expressly provided by an applicable statute.  Any repeal or amendment of this Section 8.1 by the Members shall be prospective only and shall not adversely affect any limitation on the liability of a Director or officer under this ARTICLE 8 existing at the time of such repeal or amendment.  In addition to the circumstances in which a Director or officer is not liable as set forth in the preceding sentences, a Director or officer shall not be liable for any act or omission occurring prior to the Old Effective Time to the fullest extent permitted by any provision of the statutes of Delaware hereafter enacted that further limits the liability of a manager or officer of a limited liability company.

 
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8.2            Right to Indemnification .  Subject to the limitations and conditions as provided in this ARTICLE 8 , each Person who was or is made a party or is threatened to be made a party to or is involved in any threatened, pending, or completed action, suit or proceeding relating to any action or alleged action or failure to act or alleged failure to act occurring prior to the Old Effective Time, whether civil, criminal, administrative, arbitrative or investigative (hereinafter an “ Old Pre-Effective Time Proceeding ”), or any appeal in such an Old Pre-Effective Time Proceeding or any inquiry or investigation that could lead to such an Old Pre-Effective Time Proceeding, by reason of the fact that such Person, or another Person of whom such Person is the legal representative, is or was a Member and/or Director of the Company or while a Member and/or Director of the Company is or was serving at the request of the Company prior to the Old Effective Time as a member, manager, director, officer, partner, venturer, proprietor, trustee, employee, agent, or similar functionary of another foreign or domestic limited liability company, corporation, partnership, joint venture, sole proprietorship, trust, employee benefit plan, or other enterprise, shall be indemnified by the Company to the fullest extent permitted by the Act, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Company to provide broader indemnification rights than the Act permitted the Company to provide prior to such amendment) against losses, damages, claims, demands, judgments, penalties (including excise and similar taxes and punitive damages), fines, amounts paid in settlement and reasonable expenses (including attorneys’ fees) actually incurred by such Person in connection with such Old Pre-Effective Time Proceeding (collectively “ Old Pre-Effective Time Indemnified Damages ”), and indemnification under this ARTICLE 8 shall continue as to a Person who has ceased to serve in the capacity which initially entitled such Person to indemnity hereunder. The rights granted pursuant to this ARTICLE 8 shall be deemed contract rights, and no amendment, modification or repeal of this ARTICLE 8 shall have the effect of limiting or denying any such rights with respect to actions taken or Old Pre-Effective Time Proceedings arising prior to any such amendment, modification, or repeal. It is expressly acknowledged that the indemnification provided in this ARTICLE 8 could involve indemnification for negligence or under theories of strict liability.

 
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8.3            Limitations .  No Member, Director or other Person (each, an “ Old   Pre-Effective Time Covered Person ”) shall be entitled to be indemnified in respect of any Old Pre-Effective Time Indemnified Damages incurred by such Old Pre-Effective Time Covered Person by reason of (i) an act or omission of such Old Pre-Effective Time Covered Person that involves intentional misconduct or a knowing violation of the law, (ii) a transaction from which the Old Pre-Effective Time Covered Person received an improper benefit, whether or not the benefit resulted from an action taken within the scope of such Old Pre-Effective Time Covered Person’s office, or (iii) an act or omission for which the liability of such Old Pre-Effective Time Covered Person is expressly provided by an applicable statute.  Any indemnity under this ARTICLE 8 by the Company shall be provided out of and to the extent of Company assets only, and no Member shall have personal liability on account thereof.

8.4            Advance Payment .  The right to indemnification conferred in this ARTICLE 8 shall include the right to be paid or reimbursed by the Company the reasonable expenses incurred by a Person of the type entitled to be indemnified under this ARTICLE 8 who was, is or is threatened to be made a named defendant or respondent in a Pre-Effective Time Proceeding in advance of the final disposition of the Old Pre-Effective Time Proceeding and without any determination as to the Person’s ultimate entitlement to indemnification; provided, however , that the payment of such expenses incurred by any such Person in advance of the final disposition of an Old Pre-Effective Time Proceeding, shall be made only upon delivery to the Company of a written affirmation by such Person of its good faith belief that it has met the standard of conduct necessary for indemnification under this ARTICLE 8 and a written undertaking, by or on behalf of such Person, to repay all amounts so advanced if it shall ultimately be determined that such indemnified Person is not entitled to be indemnified under this ARTICLE 8 or otherwise.

8.5            Pre-Effective Time Indemnification of Officers, Employees and Agents .  The Company shall indemnify and advance expenses to an Officer of the Company for any matters relating to any action or alleged action or failure to act or alleged failure to act occurring prior to the Effective Time or an Old Pre-Effective Time Proceeding to the extent required to do so by the Act or other applicable Law, or any employment agreement with such Officer. The Company, by adoption of a resolution by the Board, may indemnify and advance expenses to such an Officer, employee or agent of the Company to the same extent and subject to the same conditions under which it may indemnify and advance expenses to Members and/or Directors under this ARTICLE 8 or to such other extent as the Board of Directors deem advisable; and, the Company may indemnify and advance expenses to Persons who are not or were not Members and/or Directors, Officers, employees, or agents of the Company but who are or were serving at the request of the Company prior to the Old Effective Time as a member, manager, director, officer, partner, venturer, proprietor, trustee, employee, agent, or similar functionary of another foreign or domestic limited liability company, corporation, partnership, joint venture, sole proprietorship, trust, employee benefit plan, or other enterprise against any liability asserted against such Person and incurred by such Person in such a capacity or arising out of its status as such a Person to the same extent that the Company may indemnify and advance expenses to Members and/or Directors under this ARTICLE 8 .

8.6            Appearance as a Witness .  Notwithstanding any other provision of this ARTICLE 8 , the Company may pay or reimburse expenses incurred by a Member, Director or other Person indemnified pursuant to this ARTICLE 8   in connection with its appearance as a witness or other participation in an Old Pre-Effective Time Proceeding at a time when it is not a named defendant or respondent in the Old Pre-Effective Time Proceeding.

 
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8.7            Nonexclusivity of Rights .  The right to indemnification and the advancement and payment of expenses conferred in this ARTICLE 8 shall not be exclusive of any other right which a Member or Director, or other Person indemnified pursuant to this ARTICLE 8 may have or hereafter acquire under any Law, provision of this ARTICLE 8 or this Agreement, agreement, vote of Members, or otherwise.

8.8            Insurance .  The Company may maintain insurance to protect itself and any Pre-Effective Time Covered Person against any liability asserted against such Person and incurred by such Person or on such Person’s behalf whether or not the Company would have the power to indemnify such Person against such liability under the provisions of this ARTICLE 8 .

8.9            Member Notification .  To the extent required by Law, any indemnification of or advance of expenses to a Member in accordance with this ARTICLE 8 shall be reported in writing to the other Members with or before the notice or waiver of notice of the next Members’ meeting or with or before the next submission to Members of a consent to action without a meeting and, in any case, within the 12 month period immediately following the date of the indemnification or advance.

8.10          Savings Clause .  If this ARTICLE 8 or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify and hold harmless each Member, Director, or any other Person indemnified pursuant to this ARTICLE 8 as to Old Pre-Effective Time Indemnified Damages, to the fullest extent permitted by any applicable portion of this ARTICLE 8 that shall not have been invalidated and to the fullest extent permitted by Law.

ARTICLE 9
OLD POST-EFFECTIVE TIME LIMITATION OF LIABILITY AND INDEMNIFICATION

9.1            Limitation of Liability and Indemnification of the Covered Persons .

(a)            Notwithstanding any other terms of this Agreement or any Transaction Document, whether express or implied, or any obligation or duty at Law or in equity, and, to the fullest extent permitted by Law, none of the Covered Persons shall be liable to the Company or to any Member for losses sustained or liabilities incurred as a result of any act or omission in connection with the Company’s business (in relation to the Company, any transaction, any investment or any business decision or action, including for breach of contract or breach of duties) taken or omitted by a Covered Person on or after the Old Effective Time, unless there has been a final and non-appealable judgment entered by a court of competent jurisdiction determining that, in respect of such act or omission, and taking into account the acknowledgments and agreements set forth in this Agreement (including Section 7.5 ), such Covered Person acted in bad faith, engaged in fraud or willful misconduct or, in the case of a criminal matter, acted with knowledge that such Covered Person’s conduct was unlawful.

 
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(b)            Any Covered Person acting for, on behalf of or in relation to, the Company in respect of any transaction, any investment or any business decision or action or otherwise on or after the Old Effective Time shall be entitled to rely on the provisions of the Transaction Documents and on the advice of counsel, accountants and other professionals that is provided to the Company or such Covered Person, and such Covered Person shall not be liable to the Company or to any Member for such Covered Person’s reliance on any Transaction Document or such advice, provided , that there has not been a final and non-appealable judgment entered by a court of competent jurisdiction determining that, in respect of such reliance, and taking into account the acknowledgments and agreements set forth in this Agreement (including Section 7.5 ),   such Covered Person acted in bad faith, engaged in fraud or willful misconduct or, in the case of a criminal matter, acted with knowledge that such Covered Person’s conduct was unlawful.  The provisions of any Transaction Document, to the extent that they restrict or eliminate the duties and liabilities of a Covered Person otherwise existing at Law or in equity, are agreed by the Members to replace, to the fullest extent permitted by applicable Law, such duties and liabilities existing at Law or in equity of such Covered Person.  This Section 9.1(b) does not create any duty or liability of a Covered Person that does not otherwise exist at Law or in equity.  Notwithstanding any provisions of Law or in equity to the contrary, whenever a Covered Person (other than a Independent Director) is permitted or required to make a decision on or after the Old Effective Time in its “sole discretion” or “discretion” or under a grant of similar authority or latitude, such Covered Person shall be entitled to consider only such interests (including its own interests) and factors as it desires, and shall have no duty or obligation to give any consideration to any interest of or factors affecting the Company, the Members or any other person to the fullest extent permitted by applicable Law.

(c)            Each Covered Person (regardless of such person’s capacity and regardless of whether another Covered Person is entitled to indemnification) shall be indemnified and held harmless by the Company (but only to the extent of the Company’s assets), to the fullest extent permitted under applicable Law, from and against any and all loss, liability and expense (including taxes; penalties; judgments; fines; amounts paid or to be paid in settlement; costs of investigation and preparations; and fees, expenses and disbursements of attorneys, whether or not the dispute or proceeding involves the Company or any Manager or Member) reasonably incurred or suffered by any such Covered Person on or after the Old Effective Time in connection with the activities of the Company on or after the Old Effective Time, provided , that such Covered Person shall not be so indemnified and held harmless if there has been a final and non-appealable judgment entered by a court of competent jurisdiction determining that, in respect of the matter for which such Covered Person is seeking indemnification or seeking to be held harmless hereunder, and taking into account the acknowledgments and agreements set forth in this Agreement (including Section 7.5 ), such Covered Person acted in bad faith, engaged in fraud or willful misconduct or, in the case of a criminal matter, acted with knowledge that such Covered Person’s conduct was unlawful.  A Covered Person shall not be denied indemnification in whole or in part under this Section 9.1 because such Covered Person had an interest in the transaction with respect to which the indemnification applies if the transaction was otherwise permitted by the terms of this Agreement.

(d)            Each Covered Person may rely, and shall incur no liability in acting or refraining from acting, upon any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, bond, debenture, paper, document, signature or writing reasonably believed by it to be genuine, and may rely on a certificate signed by an officer, agent or representative of any Person in order to ascertain any fact with respect to such person or within such Person’s knowledge, in each case unless there has been a final and non-appealable judgment entered by a court of competent jurisdiction determining that, in respect of such reliance, action or inaction, such Covered Person acted in bad faith, engaged in fraud or willful misconduct or, in the case of a criminal matter, acted with knowledge that such Covered Person’s conduct was unlawful.

 
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(e)            NOTWITHSTANDING ANYTHING IN ANY TRANSACTION DOCUMENT TO THE CONTRARY, TO THE FULLEST EXTENT PERMITTED BY LAW, NEITHER THE COMPANY NOR ANY COVERED PERSON SHALL BE LIABLE TO THE COMPANY, TO ANY MEMBER OR TO ANY OTHER PERSON MAKING CLAIMS ON BEHALF OF THE FOREGOING FOR CONSEQUENTIAL, EXEMPLARY, PUNITIVE, INCIDENTAL, INDIRECT OR SPECIAL DAMAGES, INCLUDING DAMAGES FOR LOSS OF PROFITS, LOSS OF USE OR REVENUE OR LOSSES BY REASON OF COST OF CAPITAL, ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER TRANSACTION DOCUMENT, THE BUSINESS OF THE COMPANY, THE GRANTING OR WITHHOLDING OF ANY APPROVAL REQUIRED HEREUNDER OR THE TRANSACTIONS CONTEMPLATED HEREBY, REGARDLESS OF WHETHER BASED ON CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY, VIOLATION OF ANY APPLICABLE DECEPTIVE TRADE PRACTICES ACT OR SIMILAR LAW OR ANY OTHER LEGAL OR EQUITABLE DUTY OR PRINCIPLE, AND THE COMPANY AND EACH COVERED PERSON RELEASE EACH OF THE OTHER SUCH PERSONS FROM LIABILITY FOR ANY SUCH DAMAGES.

(f)            The obligations of the Company to the Covered Persons provided in the Transaction Documents or arising under Law are solely the obligations of the Company, and no personal liability whatsoever shall attach to, or be incurred by, any Member or other Covered Person for such obligations, to the fullest extent permitted by Law.  The obligations of each Investor which was a Member provided in the Transaction Documents or arising under Law are solely the obligations of such Investor, and no personal liability whatsoever shall attach to, or be incurred by, any other Covered Person for such obligations, to the fullest extent permitted by Law.  Where the foregoing provides that no personal liability shall attach to or be incurred by a Covered Person, any claims against or recourse to such Covered Person for or in connection with such liability, whether arising in common law or equity or created by rule of law, statute, constitution, contract or otherwise, are expressly released and waived under the Transaction Documents, to the fullest extent permitted by Law, as a condition of, and as part of the consideration for, the execution of the Transaction Documents and any related agreement, and the incurring by the Company or such Member of the obligations provided in such agreements.

(g)            Unless otherwise expressly provided in this Agreement, whenever a conflict of interest exists or arises between a Covered Person or any of its Affiliates, on the one hand, and the Company or another Member, on the other, any resolution or course of action by such Covered Person or its Affiliates in respect of such conflict of interest shall be permitted and deemed approved by all Members, and shall not constitute a breach of this Agreement, of any other Transaction Document or of any duty stated or implied by law or equity, if the resolution or course of action in respect of such conflict of interest is (i) approved by the disinterested holders of a majority of the Membership Interests then outstanding, (ii) determined by such Covered Person in accordance with the provisions of Section 9.1(b) above to be on terms no less favorable to the Company than those generally being provided to or available from unrelated third parties or (iii) determined by such Covered Person in accordance with the provisions of Section 9.1(b) above to be fair and reasonable to the Company, taking into account the totality of the relationships among the parties involved (including other transactions that may be particularly favorable or advantageous to the Company).  If the resolution or course of action taken with respect to a conflict of interest is determined by the Board to satisfy either of the standards set forth in clauses (ii) or (iii) above, then it shall be presumed that, in making such decision, the Board acted in good faith, and in any proceeding brought by any Member or by or on behalf of such Member or any other Member or the Company challenging such approval, the Person bringing or prosecuting such proceeding shall have the burden of overcoming such presumption.

 
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(h)            Nothing in this Section 9.1 shall be deemed to limit or waive any rights that any Person has for breach of contract under the terms of the Transaction Documents; provided, however , that each Member acknowledges that it is not relying upon any other Member or any of such other Member’s Affiliates, or any of such other Member’s or such other Member’s Affiliates’ respective stockholders, partners, members, directors, officers or employees, in making its investment or decision to invest in the Company or in monitoring such investment.

(i)            The Members hereby acknowledge that certain of the Covered Persons may have certain rights to indemnification, advancement of expenses and/or insurance provided by the Quintana Entity and/or certain of its Affiliates.  The Members hereby agree that (i) the Company is the indemnitor of first resort (i.e., its obligations to any Covered Person are primary and any obligation of the Quintana Entity and its Affiliates to advance expenses or to provide indemnification for the same expenses or liabilities incurred by a particular Covered Person are secondary), (ii) the Company shall be required to advance the full amount of expenses incurred by a Covered Person and shall be liable for the full amount of all expenses, judgments, penalties, fines and amounts paid in settlement to the extent legally permitted and as required by the terms of this Agreement or the Certificate of Formation (or any other applicable agreement between the Company and a Covered Person), without regard to any rights a Covered Person may have against the Quintana Entity and its Affiliates, and (iii) the Company irrevocably waives, relinquishes and releases the Quintana Entity and its Affiliates from any and all claims against the Quintana Entity and its Affiliates for contribution, subrogation or any other recovery of any kind in respect of claims against the Company under Section 9.1 .  The Members further agree that no advancement or payment by the Quintana Entity and its Affiliates on behalf of a Covered Person with respect to any claim for which such Covered Person has sought indemnification from the Company shall affect the foregoing and the Quintana Entity and its Affiliates shall have a right of contribution and/or be subrogated to the extent of such advancement or payment to all of the rights of recovery of such Indemnitee against the Company.  The Quintana Entity and its Affiliates are express third party beneficiaries of the terms of this Section 9.1(i) .

 
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9.2            Indemnification of the Management Covered Persons .

(a)            The Company shall indemnify, to the full extent permitted by applicable Law, any Management Covered Person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding relating to an action or alleged action or failure to act or alleged failure to act occurring on or after the Old Effective Time, whether civil, criminal, administrative or investigative (each, an “ Old Post-Effective Time Proceeding ”) by reason of the fact that (x) such person is or was serving or has agreed to serve as a Manager or Officer of the Company on or after the Old Effective Time or (y) such person, while serving as a Manager or Officer of the Company, is or was serving or has agreed to serve at the request of the Company on or after the Old Effective Time as a director, officer, employee, manager or agent of another company, partnership, limited liability company, joint venture, trust or other enterprise or (z) such person is or was serving or has agreed to serve at the request of the Company on or after the Old Effective Time as a director, officer or manager of another company, partnership, limited liability company, joint venture, trust or other enterprise, or by reason of any action alleged to have been taken or omitted by such person in such capacity on or after the Old Effective Time, and who satisfies the applicable standard of conduct set forth for the indemnification of an officer or director of a Delaware corporation under Section 145(a) or (b), as applicable, of the DGCL:

(i)             in an Old Post-Effective Time Proceeding other than an Old Post-Effective Time Proceeding by or in the right of the Company, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such Person or on such Person’s behalf in connection with such Post-Effective Time Proceeding and any appeal therefrom, or

(ii)            in a Post Effective Time Proceeding by or in the right of the Company to procure a judgment in its favor, against expenses (including attorneys’ fees) actually and reasonably incurred by such Person or on such Person’s behalf in connection with the defense or settlement of such Post-Effective Time Proceeding and any appeal therefrom.

(b)             Section 9.2(a) does not require the Company to indemnify a Management Covered Person in respect of an Old Post-Effective Time Proceeding (or part thereof) instituted by such Person on his or her own behalf, unless such Old Post-Effective Time Proceeding (or part thereof) has been authorized by the Board or the indemnification requested is pursuant to the last sentence of Section 9.3 .

9.3            Advance of Expenses .  The Company shall advance all expenses (including reasonable attorneys’ fees) incurred by a Covered Person or a Management Covered Person in defending any Old Post-Effective Time Proceeding prior to the final disposition of such Old Post-Effective Time Proceeding upon written request of such Person and delivery of an undertaking (which may be unsecured) by such Person to repay such amount if it shall ultimately be determined that such Person is not entitled to be indemnified by the Company; provided, however , that the Company shall not be obligated to advance expenses under this Section 9.3 to any Management Covered Person if the Board determines that such Management Covered Person has not satisfied the applicable standard of conduct set forth for the indemnification of an officer or director of a Delaware corporation under Section 145(a) or (b), as applicable, of the DGCL, as such may be amended from time to time.  The Company may authorize any counsel for the Company to represent (subject to applicable conflict of interest considerations) such Covered Person or Management Covered Person in any Old Post-Effective Time Proceeding, whether or not the Company is a party to such Old Post-Effective Time Proceeding.

 
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9.4            Procedure for Indemnification .  Any indemnification or advance of expenses under this ARTICLE 9 shall be made only against a written request therefor submitted by or on behalf of the person seeking such indemnification or advance.  All expenses (including reasonable attorneys’ fees) incurred by such person in connection with successfully establishing such person’s right to indemnification or advance of expenses under this ARTICLE 9 , in whole or in part, shall also be indemnified by the Company.

9.5            Contract Right; Non-Exclusivity; Survival .

(a)            The rights to indemnification and advance of expenses provided by this ARTICLE 9 shall be deemed to be separate contract rights between the Company and each Covered Person and Management Covered Person who serves in any such capacity at any time while these provisions are in effect, and no repeal or modification of any of these provisions shall adversely affect any right or obligation of such Covered Person or Management Covered Person existing at the time of such repeal or modification with respect to any state of facts then or previously existing or any proceeding previously or thereafter brought or threatened based in whole or in part upon any such state of facts.

(b)            The rights to indemnification and advance of expenses provided by this ARTICLE 9 shall not be deemed exclusive of any other indemnification or advance of expenses to which a Covered Person or Management Covered Person seeking indemnification or advance of expenses may be entitled.

(c)            The rights to indemnification and advance of expenses provided by this ARTICLE 9 to any Covered Person or Management Covered Person shall inure to the benefit of the heirs, executors and administrators of such person.

9.6            Insurance .

(a)            The Company may maintain insurance to protect itself and any Covered Person against any liability asserted against such Person and incurred by such Person or on such Person’s behalf whether or not the Company would have the power to indemnify such Person against such liability under the provisions of Section 9.1 .  The Company may purchase and maintain insurance on behalf of any Management Covered Person, or any Management Covered Person who is or was serving at the request of the Company as a director or officer of another company, partnership, joint venture, trust or other enterprise against any liability asserted against such Person and incurred by such Person or on such Person’s behalf in any such capacity, or arising out of such Person’s status as such, whether or not the Company would have the power to indemnify such Person against such liability under the provisions of Section 9.2(a) .

 
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(b)            With respect to each Person who is a Director as of the Effective Time, so long as such Director shall continue to serve as a Director of the Company, the Company or Genesis shall maintain, and for six years thereafter so long as such Director shall be subject to any possible Old Post-Effective Time Proceeding or Old Pre-Effective Time Proceeding by reason of the fact that such Director was a Director or Officer of the Company shall cause such Director to be covered by, the policies of directors’ and officers’ liability insurance maintained by the Company or Genesis and their respective subsidiaries, as applicable, in effect as of the Effective Date, except that the Company and Genesis may substitute policies of at least the same coverage and amounts provided by established and reputable insurers containing terms and conditions which are not less advantageous to such Directors than the policies in effect as of the Effective Date; provided , that the Company and Genesis are not required to pay annual premiums in excess of 300% of the last annual premium paid by the Company or Genesis, as applicable, prior to the Effective Date.  Notwithstanding the foregoing, the Company and Genesis will have no obligation to obtain or maintain the insurance contemplated by this Section 9.6(b) if the Board determines in good faith that such insurance is not reasonably available.  The Company will promptly notify any affected Directors of any such determination not to provide insurance coverage.

9.7            Interpretation; Severability .  References to the Company in this ARTICLE 9 shall be deemed to be references to the Company and its Subsidiaries.  If this ARTICLE 9 or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify each Covered Person or Management Covered Person of the Company as to costs, charges and expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement with respect to any action, suit or proceeding, whether civil, criminal, administrative or investigative, including an action by or in the right of the Company, to the fullest extent permitted by any applicable portion of this ARTICLE 9 that shall not have been invalidated.

ARTICLE 10
CERTAIN AGREEMENTS OF THE COMPANY AND MEMBERS

10.1          Financial Reports and Access to Information .  With respect to each calendar year, the Board shall prepare, or cause to be prepared, and deliver, or cause to be delivered, to each Member such federal, state and local income tax returns and such other accounting, tax information and schedules as shall be necessary for the preparation by each Member on or before June 15 following the end of each calendar year of its income tax return with respect to such year.

10.2          Maintenance of Books .  The Company shall keep or cause to be kept at the principal office of the Company or at such other location approved by the Board of Directors complete and accurate books and records of the Company, supporting documentation of the transactions with respect to the conduct of the Company’s business and minutes of the proceedings of the Board of Directors and any other books and records that are required to be maintained by applicable Law.

 
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10.3          Accounts .  The Company shall establish one or more separate bank and investment accounts and arrangements for the Company, which shall be maintained in the Company’s name with financial institutions and firms that the Board may determine.  The Company may not commingle the Company’s funds with the funds of any Member or any Affiliate of a Member.

ARTICLE 11
TAXES

11.1          Tax Returns .  The Company shall prepare and timely file all U.S. federal, state and local and foreign tax returns required to be filed by the Company.

11.2          Tax Classification .  It is the intention of the Members that the Company be classified as a disregarded entity for U.S. federal income tax purposes.

ARTICLE 12
DISSOLUTION, WINDING-UP AND TERMINATION

12.1          Dissolution .

(a)            Subject to Section 12.1(b) , the Company shall be liquidated and its affairs shall be wound up on the first to occur of the following events (each a “ Liquidation Event ”) and no other event shall cause the Company’s dissolution:

(i)             the consent of the Board in accordance with ARTICLE 7 ;

(ii)            at any time when there are no Members; and

(iii)           entry of a decree of judicial dissolution of the Company under Section 18-802 of the Act.

(b)            If the Liquidation Event described in Section 12.1(a)(ii) shall occur, the Company shall not be dissolved, and the business of the Company shall be continued, if the requirements of Section 18-801 of the Act for the avoidance of dissolution are satisfied (a “ Continuation Election ”).

(c)            Except as otherwise provided in this Section 12.1 , to the maximum extent permitted by the Act, the death, retirement, Resignation, expulsion, Bankruptcy or dissolution of a Member or the commencement or consummation of separation proceedings shall not constitute a Liquidation Event and, notwithstanding the occurrence of any such event or circumstance, the business of the Company shall be continued without dissolution.

12.2          Winding-Up and Termination .  On the occurrence of a Liquidation Event, unless a Continuation Election is made, the Board may select one or more Persons to act as liquidator or may itself act as liquidator.  The liquidator shall proceed diligently to wind up the affairs of the Company and make final distributions as provided herein and in the Act.  The costs of winding up shall be borne as a Company expense, including reasonable compensation to the liquidator if approved by the Board.  Until final distribution, the liquidator shall continue to operate the Company properties with all of the power and authority of the Board.  The steps to be accomplished by the liquidator are as follows:

 
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(a)            as promptly as possible after dissolution and again after final winding up, the liquidator shall cause a proper accounting to be made by a recognized firm of certified public accountants of the Company’s assets, liabilities and operations;

(b)            the liquidator shall pay, satisfy or discharge from Company funds all of the debts, liabilities and obligations of the Company (including all expenses incurred in winding up) or otherwise make adequate provision for payment and discharge thereof (including the establishment of a cash escrow fund for contingent liabilities in such amount and for such term as the liquidator may reasonably determine); and

(c)            all remaining assets of the Company shall be distributed to the Members as follows:

(i)             the liquidator may sell any or all Company property, including to Members; and

(ii)            Company property shall be distributed among the Members in accordance with Section 5.1 , and those distributions shall be made by the end of the taxable year of the Company during which the liquidation of the Company occurs (or, if later, ninety (90) days after the date of the liquidation).

All distributions in kind to the Members shall be made subject to the liability of each distributee for costs, expenses and liabilities theretofore incurred or for which the Company has committed prior to the date of termination and those costs, expenses and liabilities shall be allocated to the distributee pursuant to this Section 12.2 .  The distribution of cash or property to the Members in accordance with the provisions of this Section 12.2 constitutes a complete return to such Member of its Capital Contributions and a complete distribution to the Members of its Membership Interests and all the Company’s property and constitutes a compromise to which all Members have consented within the meaning of Section 18-502(b) of the Act.  To the extent that a Member returns funds to the Company, it has no claim against any other Member for those funds.

12.3          Certificate of Cancellation .  On completion of the distribution of Company assets as provided herein, the Board (or such other Person or Persons as the Act may require or permit) shall file a Certificate of Cancellation with the Secretary of State of Delaware, and take such other actions as may be necessary to terminate the existence of the Company.  Upon the effectiveness of the Certificate of Cancellation, the existence of the Company shall cease, except as may be otherwise provided by the Act or other applicable Law.

ARTICLE 13
GENERAL PROVISIONS

13.1          Offset .  Whenever the Company is to pay any sum to any Member, any amounts that such Member, in its capacity as a Member, owes the Company, whether pursuant to this Agreement or another Transaction Document, may be deducted from that sum before payment.

 
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13.2          Notices .

(a)            Except as expressly set forth to the contrary in this Agreement, all notices, requests or consents provided for or required to be given hereunder shall be in writing and shall be deemed to be duly given if personally delivered, telecopied and confirmed, or mailed by certified mail, return receipt requested, or nationally recognized overnight delivery service with proof of receipt maintained, at the following addresses (or any other address that any such party may designate by written notice to the other parties):

(i)             if to the Company, at the address of its principal executive offices; and

(ii)            if to a Member, to the address given for the Member on Schedule I hereto.

Any such notice shall, if delivered personally, be deemed received upon delivery; shall, if delivered by telecopy, be deemed received on the first business day following confirmation; shall, if delivered by certified mail, be deemed received upon the earlier of actual receipt thereof or five (5) business days after the date of deposit in the United States mail, as the case may be; and shall, if delivered by nationally recognized overnight delivery service, be deemed received the first (1 st ) business day after the date of deposit with the delivery service.

(b)            Whenever any notice is required to be given by Law, the Certificate or this Agreement, a written waiver thereof, signed by the Person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice.

13.3          Entire Agreement; Supersedure .  This Agreement (including the Exhibits and Schedules) constitutes the entire agreement of the Members relating to the Company and supersedes all prior contracts or agreements with respect to the Company, whether oral or written.

13.4          Effect of Waiver or Consent .  A waiver or consent, express or implied, to or of any breach or default by any Person in the performance by that Person of its obligations with respect to the Company is not a consent or waiver to or of any other breach or default in the performance by that Person of the same or any other obligations of that Person with respect to the Company.  Failure on the part of a Person to complain of any act of any Person or to declare any Person in default with respect to the Company, irrespective of how long that failure continues, does not constitute a waiver by that Person of its rights with respect to that default until the applicable statute-of-limitations period has run.

13.5          Amendment or Restatement .  Neither this Agreement (including any Exhibit or Schedule hereto) nor the Certificate may be amended, modified, supplemented or restated, nor may any provisions of this Agreement or the Certificate be waived, without the approval of the Board.

13.6          Binding Effect .  Subject to the restrictions on Dispositions set forth in this Agreement, this Agreement shall be binding upon and shall inure to the benefit of the Company and each Member and their respective heirs, permitted successors, permitted assigns, permitted distributees and legal representatives; and by their signatures hereto, the Company and each Member intends to and does hereby become bound.  Nothing expressed or mentioned in this Agreement is intended or shall be construed to give any Person other than the parties hereto and their respective permitted successors and assigns any legal or equitable right, remedy or claim under, in or in respect of this Agreement or any provision herein contained.  The rights under this Agreement may be assigned by a Member to a transferee of all or a portion of such Member’s Membership Interests transferred in accordance with this Agreement (and shall be assigned to the extent this Agreement requires such assignment), but only to the extent of such Membership Interests so transferred.

 
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13.7          Governing Law; Severability; Limitation of Liability .

(a)            THIS AGREEMENT IS GOVERNED BY AND SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF DELAWARE, WITHOUT REGARD TO THE CONFLICTS OF LAW PRINCIPLES OF SUCH STATE.

(b)            The parties hereto hereby irrevocably submit to the exclusive jurisdiction of the federal courts of the State of Delaware and the Delaware Court of Chancery, and appropriate appellate courts therefrom, over any dispute arising out of or relating to this Agreement or any of the transactions contemplated hereby (except as otherwise expressly provided in any employment agreement or non-competition and confidentiality agreement), and each party hereby irrevocably agrees that all claims in respect of such dispute or proceeding may be heard and determined in such courts.  The parties hereby irrevocably waive, to the fullest extent permitted by applicable Law, any objection which they may now or hereafter have to the laying of venue of any dispute arising out of or relating to this Agreement or any of the transactions contemplated hereby brought in such court or any defense of inconvenient forum for the maintenance of such dispute.  Each of the parties hereto agrees that a judgment in any such dispute may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law.  This consent to jurisdiction is being given solely for purposes of this Agreement and is not intended to, and shall not, confer consent to jurisdiction with respect to any other dispute in which a party to this Agreement may become involved.  Each of the parties hereto hereby consents to process being served by any party to this Agreement in any suit, action or proceeding of the nature specified in this subsection (b) by the mailing of a copy thereof in the manner specified by the provisions of Section 13.2 .  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT.

(c)            In the event of a direct conflict between the provisions of this Agreement and (i) any provision of the Certificate or (ii) any mandatory, non-waivable provision of the Act, such provision of the Certificate or the Act shall control.  If any provision of the Act provides that it may be varied or superseded in the agreement of a limited liability company (or otherwise by agreement of the members or managers of a limited liability company), such provision shall be deemed superseded and waived in its entirety if this Agreement contains a provision addressing the same issue or subject matter.

 
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(d)            If any provision of this Agreement is held to be illegal, invalid or unenforceable under present or future Laws effective during the term of this Agreement, such provision shall be fully severable; this Agreement shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part of this Agreement; and 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 from this Agreement.  Furthermore, in lieu of each such illegal, invalid or unenforceable provision, there shall be added automatically as a part of this Agreement a provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and be legal, valid and enforceable.

13.8          Further Assurances .  In connection with this Agreement and the transactions contemplated hereby, the Company and each Member shall execute and deliver all such future instruments and take such other and further action as may be reasonably necessary or appropriate to carry out the provisions of this Agreement and the intention of the parties as expressed herein.

13.9          Counterparts .  This Agreement may be executed in any number of counterparts (including facsimile counterparts), all of which together shall constitute a single instrument.

[ Remainder of Page Left Blank ]

[ Signature Page Follows ]

 
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IN WITNESS WHEREOF, the Members have executed this Agreement as of the date first set forth above.

 
GENESIS ENERGY, L.P.
       
   
By:
GENESIS ENERGY, LLC,
     
its general partner
       
   
By:
/s/ Grant E. Sims
   
Name: Grant E. Sims
   
Title:   Chief Executive Officer

[Signature Page – Second Amended and Restated Limited Liability Company Agreement (1 of 2)]

 
 

 

 
  /s/ Robert C. Sturdivant
 
Robert C. Sturdivant, a Director, designated by the Quintana Entity, as attorney-in-fact for all other Members pursuant to the power of attorney granted pursuant to Section 14.5(b)
       
 
GENESIS ENERGY, LLC
       
   
By:
/s/ Robert C. Sturdivant
   
Name: Robert C. Sturdivant
   
Title:   Chairman of the Board

[Signature Page – Second Amended and Restated Limited Liability Company Agreement (2 of 2)]

 
 

 

EXHIBIT A

DEFINED TERMS

Acquisition ” is defined in the recitals.

Act ” means the Delaware Limited Liability Company Act and any successor statute, as amended from time to time.

Additional Member ” means any Person who acquires newly issued Membership Interests from the Company.

Affiliate ” means, when used with respect to a specified Person, any Person which (a) directly or indirectly Controls, is Controlled by or is Under Common Control with such specified Person, (b) is an officer, director, general partner, trustee or manager of such specified Person, or of a Person described in clause (a), or (c) is a Relative of such specified Person or of an individual described in clauses (a) or (b).

Agreement ” is defined in the recitals.

Available Cash ” means, with respect to any fiscal quarter, (a) all cash and cash equivalents of the Company at the end of such quarter, less (b) the amount of any cash reserves that are necessary or appropriate in the reasonable discretion of the Board to (i) provide for the proper conduct of the business of the Company subsequent to such quarter, (ii) comply with applicable law or any agreement or obligation, including reserves for: (1) payments of principal, interest, charges and fees pertaining to the Company’s indebtedness; (2) expenditures incurred incident to the usual conduct of the Company’s business; and (3) amounts reserved to meet the reasonable needs of the Company’s business.

Bankruptcy ” or “ Bankrupt ” means with respect to any Person, that (a) such Person (i) makes a general assignment for the benefit of creditors; (ii) files a voluntary bankruptcy petition; (iii) becomes the subject of an order for relief or is declared insolvent in any federal or state bankruptcy or insolvency proceedings; (iv) files a petition or answer seeking for such Person a reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under any Law; (v) files an answer or other pleading admitting or failing to contest the material allegations of a petition filed against such Person in a proceeding of the type described in subclauses (i) through (iv) of this clause (a); or (vi) seeks, consents to or acquiesces in the appointment of a trustee, receiver or liquidator of such Person or of all or any substantial part of such Person’s properties; or (b) against such Person, a proceeding seeking reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under any Law has been commenced and one hundred twenty (120) days have expired without dismissal thereof or with respect to which, without such Person’s consent or acquiescence, a trustee, receiver or liquidator of such Person or of all or any substantial part of such Person’s properties has been appointed and ninety (90) days have expired without the appointment’s having been vacated or stayed, or ninety (90) days have expired after the date of expiration of a stay, if the appointment has not previously been vacated.

Genesis Energy, LLC
Second Amended and Restated Limited Liability Company Agreement
Exhibit A-1

 
 

 

Board ” is defined in Section 7.1 .

Capital Contribution ” means with respect to any Member, the amount of money and the initial fair market value of any property (other than money) contributed to the Company by such Member.  Any reference in this Agreement to the Capital Contribution of a Member shall include a Capital Contribution of its predecessors in interest.

Capital Stock ” means any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all ownership interests in a limited liability company, partnership or other Person (other than a corporation), and any and all warrants, options or other rights to purchase or acquire any of the foregoing.

Certificate ” means the Certificate of Formation of the Company, as amended from time to time.

Code ” means the United States Internal Revenue Code of 1986, as amended from time to time.  All references herein to sections of the Code shall include any corresponding provision or provisions of succeeding Law.

Common Units – Class B ” is defined in the Genesis Agreement.

Company ” means Genesis Energy, LLC, a Delaware limited liability company.

Company Property ” is defined in Section 7.1(b) .

Continuation Election ” is defined in Section 12.1(b) .

Control, ” including the correlative terms “ Controlling, ” “ Controlled by ” and “ Under Common Control with ” means possession, directly or indirectly (through one or more intermediaries), of the power to direct or cause the direction of management or policies (whether through ownership of securities or any partnership or other ownership interest, by contract or otherwise) of a Person.

Conversion ” is defined in the recitals.

Covered Person ” means any Member, Director or other Person entitled to indemnification under this Agreement.

Davison Group ” means James E. Davison, James E. Davison, Jr., Todd A. Davison, Steven K. Davison, and each of their transferees, successors and assigns.

DGCL ” means the Delaware General Corporation Law.

DGM ” is defined in the recitals.

Director ” is defined in Section 7.1 .

Genesis Energy, LLC
Second Amended and Restated Limited Liability Company Agreement
Exhibit A-2

 
 

 

Disposition, ” including the correlative terms “ Dispose ” or “ Disposed ,” means any direct or indirect transfer, assignment, sale, gift, inter vivos transfer, pledge, hypothecation, mortgage, or other encumbrance, or any other disposition (whether voluntary or involuntary or by operation of law) of Membership Interests (or any interest (pecuniary or otherwise) therein or right thereto), including derivative or similar transactions or arrangements whereby a portion or all of the economic interest in, or risk of loss or opportunity for gain with respect to, Membership Interests is transferred or shifted to another Person.

Effective Date ” is defined in the preamble.

Effective Time ” is defined in the Merger Agreement.

EIV Entity ” means EIV Capital Fund LP, a Delaware limited partnership and its transferees, successors and assigns.

First Amended and Restated LLC Agreement ” is defined in the recitals.

Genesis ” means Genesis Energy, L.P., a Delaware limited partnership and any successor thereto.

Genesis Agreement ” means the Fifth Amended and Restated Agreement of Limited Partnership of Genesis dated December 28, 2010, as amended or restated.

Genesis Property ” is defined in Section 7.1(b)(iii ).

Independent Director ” means a non-employee Director who is independent of the Members and the management and operating executives of the Company, free from any relationship that would interfere with the exercise of his or her independent judgment, and who is “independent” under the rules or listing standards established by the New York Stock Exchange (or any other national securities exchange upon which the Company’s or Genesis’ equity or common units, respectively, are traded) and the Securities and Exchange Commission, if and to the extent applicable.

Investors ” means the Quintana-Related Entities, the Davison Group, the EIV Entity and each of their respective Affiliates (other than the Company and its Subsidiaries) and any Person who became a holder of Series A Units after the Old Effective Date and was designated an Investor by the Board.

Jones Act ” means the Merchant Marine Act of 1920, as amended.

Law ” means any applicable constitutional provision, statute, act, code (including the Code), law, regulation, rule, ordinance, order, decree, ruling, proclamation, resolution, judgment, decision, declaration, or interpretative or advisory opinion or letter of a domestic, foreign or international governmental authority or any political subdivision thereof and shall include, for the avoidance of doubt, the Act.

Liquidation Event ” is defined in Section 12.1(a) .

Genesis Energy, LLC
Second Amended and Restated Limited Liability Company Agreement
Exhibit A-3

 
 

 

Limited Partner ” is as defined in the Genesis Agreement.

Management Covered Person ” means each Covered Person who is a current or former Officer of the Company or a Subsidiary of the Company.

Member ” means any Person (but not any Affiliate or entity in which such Person has an equity interest) executing this Agreement as of the date of this Agreement as a member or hereafter admitted to the Company as a member as provided in this Agreement, but such term does not include any Person who has ceased to be a member in the Company as of the date hereof.

Membership Interest ” means the interest of a Member in the Company, including rights to distributions (liquidating or otherwise), allocations, notices and information, and all other rights, benefits and privileges enjoyed by that Member (under the Act, the Certificate, this Agreement or otherwise) in its capacity as a Member; and all obligations, duties and liabilities imposed on that Member (under the Act, the Certificate, this Agreement, or otherwise) in its capacity as a Member.

Merger ” is defined in the recitals.

Merger Agreement ” is defined in the recitals.

MergerCo ” is defined in the recitals.

Officer ” means any Person designated as an officer of the Company as provided in Section 7.3 , but such term does not include any Person who has ceased to be an officer of the Company.

Old Effective Time ” means the Effective Time of the QGA Merger.

Old Post-Effective Time Proceeding ” is defined in Section 9.2(a ).

Old Pre-Effective Time Covered Person ” is defined in Section 8.3 .

Old Pre-Effective Time Indemnified Damages ” is defined Section 8.2 .

Old Pre-Effective Time Proceeding ” is defined in Section 8.2 .

Original LLC Agreement ” is defined in the recitals.

Person ” means any natural person, corporation, limited partnership, general partnership, limited liability company, joint stock company, joint venture, association, company, estate, trust, bank trust company, land trust, business trust, or other organization, whether or not a legal entity, custodian, trustee-executor, administrator, nominee or entity in a representative capacity and any government or agency or political subdivision thereof.

QGA ” is defined in the recitals.

Genesis Energy, LLC
Second Amended and Restated Limited Liability Company Agreement
Exhibit A-4

 
 

 

QGA Merger ” is defined in the recitals.

Quintana Entity ” means Q GEI Holdings, LLC, and it transferees, successors and assigns.

Quintana-Related Entity ” means the Quintana Entity, Quintana Energy Partners I, L.P., Quintana Energy Partners II, L.P., QEP Management Co., L.P., QEP Management Co. GP, LLC, and any entity directly or indirectly Affiliated with such entities, including subsidiaries of such entities directly or indirectly controlled by the QCG, or such entities; investment vehicles to which investment management services are provided by any of them.

Relative ” means, with respect to any individual, (a) such individual’s spouse, (b) any direct descendant, parent, grandparent, great grandparent or sibling (in each case whether by blood or adoption), and (c) the spouse of an individual described in clause (b).

 “ Resign, Resigning or Resignation ” means the resignation, withdrawal or retirement of a Member from the Company as a Member.

Securities Act ” means the Securities Act of 1933, as amended, and any successor statute thereto and the rules and regulations of the Securities and Exchange Commission promulgated thereunder.

Special Approval ” is defined in the Genesis Agreement.

Subsidiary ” means (a) any corporation, partnership, limited liability company or other entity a majority of the Capital Stock of which having ordinary voting power to elect a majority of the board of directors or other Persons performing similar functions is at the time owned, directly or indirectly, with power to vote, by the Company or any direct or indirect Subsidiary of the Company, (b) a partnership in which the Company or any direct or indirect Subsidiary is a general partner or (c) a limited liability company in which the Company or any director or indirect Subsidiary is a managing member or manager.

Substituted Member ” means any Person who acquires Membership Interests from a Member.

Surviving Entity ” is defined in the recitals.

Transaction Documents ” means this Agreement and each agreement attached as an Exhibit to this Agreement and the First Amended and Restated LLC Agreement (including any exhibit to any Exhibit).

Treasury Regulations ” means the regulations promulgated by the United States Department of the Treasury pursuant to and in respect of provisions of the Code.

Genesis Energy, LLC
Second Amended and Restated Limited Liability Company Agreement
Exhibit A-5

 
 

 

Unitholder Rights Agreement ” means that certain Unitholder Rights Agreement among Genesis, the Company and the other parties thereto, dated as of July 25, 2007, as amended on October 15, 2007, and on the date hereof (as it may be further amended, modified or supplemented from time to time).

Genesis Energy, LLC
Second Amended and Restated Limited Liability Company Agreement
Exhibit A-6

 
 

 

SCHEDULE I

MEMBERS

Members
Membership Interest
   
Genesis Energy, L.P.
 
1919 Milam, Suite 2100
Houston, Texas 77002
Attn: Grant E. Sims
Facsimile: (713) 860-2647
100%

Genesis Energy, LLC
Second Amended and Restated Limited Liability Company Agreement
Schedule I
 
 


Exhibit 10.1
 
Execution Copy


REGISTRATION RIGHTS AGREEMENT

 
By and Among
 

Genesis Energy, L.P.
(“Partners”)
And
The Unitholders Party Hereto
(“Unitholders”)
 

Dated as of

December 28, 2010

 
 

 

TABLE OF CONTENTS

1.
Definitions
1
2.
Mandatory Shelf Registration
4
3.
Demand Registration
5
4.
Piggy-Back Registration
6
5.
Underwritten Offerings
7
6.
Registration Procedures
9
7.
Holdback Agreement
14
8.
Stop Transfer Instructions and Legends
15
9.
Rule 144
16
10.
Indemnification; Contribution
17
11.
Representations and Warranties
19
12.
Assignment of Registration Rights
21
13.
Miscellaneous
21

 
 

 

REGISTRATION RIGHTS AGREEMENT

This Registration Rights Agreement (this “ Agreement ”), dated as of December 28, 2010 (the “ Closing Date ”), is by and among Genesis Energy, L.P., a Delaware limited partnership (“ Partners ”), and the unitholders party hereto (each a “ Unitholder ” and collectively the “ Unitholders ”).

INTRODUCTION

A.            Pursuant to the terms of that certain Agreement and Plan of Merger, dated as of the date hereof (the “ Merger Agreement ”), by and among Partners, Genesis Acquisition, LLC, a Delaware limited liability company, and Genesis Energy, LLC, a Delaware limited liability company (“ Partners GP ”), Partners GP shall, subject to the terms and conditions set forth therein, merge with and into MergerCo, with Partners GP being the surviving entity (the “ Merger ”).

B.             Pursuant to the Merger Agreement, at the Effective Time (as defined in the Merger Agreement), the Series A Unit and Series B Unit representing membership interests in Partners GP (collectively, the “ Partners GP Units ”) shall be converted into the right to receive a total of up to 27 million limited partnership interests in Partners, consisting of (i) up to 19,960,000 Common Units – Class A (the “ Class A Units ”) (the “ Base Common Units ”), (ii) up to 7,000,000 Waiver Units issued in four classes (the “ Waiver Units ”) and (iii) 40,000 Common Units – Class B (the “ Class B Units ” and, collectively with the Class A Units, the “ Common Units ”).

C.             Upon the satisfaction of specified performance objectives, the Waiver Units will automatically convert into Class A Units (to the extent such conversion occurs with respect to the Waiver Units or the Class B Units, the “ Converted Common Units ”).

D.            The ability of the Unitholders to freely trade the above-referenced securities will be limited by applicable securities Laws and this Agreement.

E.             In order to improve the transferability and liquidity of such securities, Partners is willing to provide certain registration rights with respect thereto, subject to the terms and conditions of this Agreement.

NOW, THEREFORE, for and in consideration of the premises, covenants and agreements contained in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby confirmed, the parties hereto agree as follows:

AGREEMENT

1.              Definitions . In addition to the terms defined elsewhere herein, the following terms shall have the meanings set forth below:

Act ” means the Securities Act of 1933, as amended, or any successor federal statute, and the rules and regulations thereunder of the Commission or any successor Governmental Authority, all as shall be in effect at the time of determination.

 
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Action ” means any action, appeal, petition, plea, charge, complaint, claim, suit, demand, litigation, arbitration, mediation, hearing, inquiry, investigation or similar event, occurrence or proceeding.

Affiliate ” means a Person that directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Person specified; provided , however , that for the purposes of this Agreement no Holder, as a result of such Holder’s equity interest in Partners, shall be deemed an Affiliate of Partners or its subsidiaries, and Partners and its subsidiaries shall not be deemed an Affiliate of any Holder as result of such Holder’s equity interest in Partners.  For purposes of this definition, the term “control” (including its derivatives) means the ability to direct the management or policies of such Person by ownership of voting interest, contract or otherwise and shall be construed as such term is used in the rules promulgated under the Act.

Agreement ” has the meaning assigned to it in the preamble.

Base Common Units ” has the meaning assigned to it in the Introduction.

Best Efforts ” means best efforts in accordance with reasonable commercial practice and without the incurrence of unreasonable expense.

Class A Units ” has the meaning assigned to it in the Introduction.

Class B Units ” has the meaning assigned to it in the Introduction, and includes each unit or other security issued in respect of any Class B Unit because of or in connection with any conversion, dividend, distribution, split or purchase in any rights offering or in connection with any exchange for or replacement of such security or any combination of units, recapitalization, merger or consolidation, or any other equity securities issued pursuant to any other pro rata distribution with respect to such securities.

 “ Closing Date ” has the meaning assigned to it in the preamble.

Commission ” means the Securities and Exchange Commission.

Common Units ” has the meaning assigned to it in the Introduction.

Converted Common Units ” has the meaning assigned to it in the Introduction.

Courts ” has the meaning assigned to it in Section 13(d)(ii) .

Davison Registration Rights Agreement ” means that certain Registration Rights Agreement, as amended, by and among the Unitholders (as defined therein) and Partners, dated as of July 25, 2007.

Demand Registration ” has the meaning assigned to it in Section 3(a) .

Demand Registration Statement ” means a Registration Statement filed pursuant to a Demand Registration.

Effectiveness Target Date ” has the meaning assigned to it in Section 2(b) .

Exchange Act ” means the Securities Exchange Act of 1934, as amended, or any successor federal statute, and the rules and regulations thereunder of the Commission or any successor Governmental Authority, all as shall be in effect at the time of determination.

 
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Free Writing Prospectus ” means a free writing prospectus, as defined in Rule 405 under the Act.

Governmental Authority ” means any legislature, agency, bureau, branch, department, division, commission, court, tribunal, magistrate, justice, multi-national organization, quasi-governmental body, or other similar recognized organization or body of any federal, state, county, municipal, local, or foreign government or other similar recognized organization or body exercising similar powers or authority.

Holdback Period ” has the meaning assigned to it in Section 7(a)(ii) .

Holder ” means, to the extent it is a holder of Registrable Securities, a Unitholder and each permitted successor and assign thereof.

Issuer Free Writing Prospectus ” means an issuer free writing prospectus, as defined in Rule 433 under the Act.

Law ” means any law (statutory, common, or otherwise), constitution, treaty, convention, ordinance, equitable principle, code, rule, regulation, executive order, or other similar authority enacted, adopted, promulgated, or applied by any Governmental Authority, each as amended and now and hereinafter in effect.

Merger ” has the meaning assigned to it in the Introduction.

Merger Agreement ” has the meaning assigned to it in the Introduction.

  “Partners” has the meaning assigned to it in the preamble and includes Partners’ successors by merger, acquisition, reorganization or otherwise.

 “ Partners GP has the meaning assigned to it in the Introduction and includes Partners GP’s successors by merger, acquisition, reorganization or otherwise.

 “ Permitted Free Writing Prospectus ” has the meaning assigned to it in Section 6(c) .

Person ” means an individual or entity, including any partnership, corporation, association, joint stock company, trust, joint venture, limited liability company, unincorporated organization or Governmental Authority (or any department, agency or political subdivision thereof).

Quintana Entity ” means Q GEI Holdings LLC.

Registrable Security ” means each Base Common Unit and Converted Common Unit, upon original issuance thereof to a Holder, and at all times subsequent thereto, including upon the transfer thereof by the original Holder or any subsequent Holder, and each unit or other security issued in respect of any Waiver Unit, Class  B Unit or Registrable Security because of or in connection with any conversion, dividend, distribution, split or purchase in any rights offering or in connection with any exchange for or replacement of such Registrable Security or any combination of units, recapitalization, merger or consolidation, or any other equity securities issued pursuant to any other pro rata distribution with respect to the Registrable Securities, until the earliest to occur of:

 
(i)
the date on which it has been sold pursuant to a registration statement or sold pursuant to Rule 144;

 
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(ii)
the date on which it is saleable, in the opinion of counsel to Partners, without registration under the Act, pursuant to Rule 144 without volume or other limitations or restrictions and the Holder of such securities does not then beneficially own a number of Units greater than (i) the product of (a) the average number of Class A Units traded per day during the most recent 90 trading days (pro rated for partial trading days) and (b) 22 days, multiplied by (ii) 15.0%;

 
(iii)
the date on which it is saleable, without restriction, pursuant to another available exemption from registration under the Act and the Holder of such securities does not then beneficially own a number of Units greater than the amount specified in clause (ii) above; or

 
(iv)
the date on which it is sold to Partners or its subsidiaries.

Registration ” means any registration pursuant to this Agreement, including pursuant to a Shelf Registration Statement, a Demand Registration or a piggy-back registration.

Registration Expenses ” has the meaning assigned to it in Section 6(f) .

Registration Statement ” means any registration statement Partners files with the Commission that is covered by this Agreement.

Shelf Registration Statement ” means a “shelf” Registration Statement on a form provided for in this Agreement filed by Partners covering the resale of Registrable Securities.

Substantial Holder ” means a Holder that, together with its Affiliates, owns a number of Units greater than the product of (i) the sum of all outstanding Common Units and all Waiver Units and (ii) 5.0%.

 “ Transfer ” has the meaning assigned to it in Section 7(a) .

Units ” means the Common Units and Waiver Units, and includes any Converted Common Units.

Unitholder ” has the meaning assigned to it in the preamble.

Waiver Units ” has the meaning assigned to it in the Introduction, and includes each unit or other security issued in respect of any Waiver Unit because of or in connection with any conversion, dividend, distribution, split or purchase in any rights offering or in connection with any exchange for or replacement of such security or any combination of units, recapitalization, merger or consolidation, or any other equity securities issued pursuant to any other pro rata distribution with respect to such securities.

Withdrawn Demand Registration ” has the meaning assigned to it in Section 3(a) .

Withdrawn Request ” has the meaning assigned to it in Section 3(a) .

2.              Mandatory Shelf Registration .

(a)             Mandatory Shelf Registration . On or before 5:00 p.m. (CST) on April 6, 2011, to the extent permitted by Law, Partners shall file with the Commission a Shelf Registration Statement providing for the resale of all of the Registrable Securities (the “ Shelf Registration Statement ”), including, for the avoidance of doubt, all the Converted Common Units issued or issuable upon conversion of the Waiver Units and Class B Units.  The Shelf Registration Statement shall be on Form S-3 pursuant to Rule 415 under the Act or any successor rule thereto if the respective Registrable Securities and underlying transactions and Partners satisfy the eligibility requirements therefor.  Otherwise, the Shelf Registration Statement shall be on a form and pursuant to such rules as Partners reasonably deems appropriate.

 
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(b)             Effectiveness . Subject to the provisions of this Section 2 , Partners shall use its Best Efforts to cause the Shelf Registration Statement to be declared effective by no later than 5:00 p.m. (CST) on June 8, 2011 (the   Effectiveness Target Date ”), and shall use its Best Efforts to keep such Shelf Registration Statement continuously effective, supplemented and amended to the extent necessary to ensure that it is available for resale of such Registrable Securities by the Holders and that it conforms in all material respects with the requirements of the Act, in each case during the entire period beginning on the date such Shelf Registration Statement shall first be declared effective under the Act and ending on the first date on which there are no such Registrable Securities.

3.              Demand Registration .

(a)             Request for Non-Shelf Registration .  Subject to the limitations contained in this Agreement (including Section 6 ), at any time during any period on or after the   Effectiveness Target Date   during which Partners has not satisfied its obligations under Section 2 or has not otherwise elected to make a Shelf Registration Statement available (subject to the Best Efforts limitations and the other limitations contemplated by this Agreement, including those contained in Section 6 (d) ) to the Holders, the Holder(s) of at least a majority in aggregate number of Registrable Securities then outstanding (or the Quintana Entity (or its affiliated designee) and not such Holders, in the case of (i) an underwritten offering or (ii) if the Quintana Entity (or its affiliated designee) has not yet elected to effect an underwritten offering during such calendar year pursuant to Section 5 , if the Quintana Entity and its Affiliates (including, for the avoidance of doubt, the members (or former members, in the event of its dissolution or liquidation) of the Quintana Entity) beneficially own at least 4.0 million Common Units comprising Registrable Securities, on an as-converted to Common Units basis) may make a written request to Partners for Registration under the Act pursuant to this Section 3 of all or part of their Registrable Securities (a “ Demand Registration ”). Such request will specify the aggregate number of such Registrable Securities proposed to be sold and will also specify the intended method of disposition thereof.  Within 10 days after receipt of such request, Partners will give written notice of such Registration request to all other Holders of such Registrable Securities and include in such Registration all Registrable Securities with respect to which Partners has received written requests for inclusion therein within 10 days after the receipt by the applicable Holder of Partners’ notice.  Partners shall use its Best Efforts to cause the Registration Statement filed in connection with a Demand Registration to be declared effective as promptly as practicable after receipt of notice of such Demand Registration and shall use its Best Efforts to keep such Registration Statement effective, supplemented and amended to the extent necessary to ensure that it is available for resale by the Holders of the Registrable Securities included therein until completion of the offering contemplated thereby and that it conforms in all material respects with the requirements of the Act.  Notwithstanding anything contained in this Agreement to the contrary, Partners shall not be obligated to effect more than one Demand Registration under this Agreement at any one time, or under this Agreement more than once in any calendar year.

 
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(b)             Effective Demand Registration .  A Registration will not count as a Demand Registration for the purposes of the last sentence of Section 3(a) until it has become effective.  Any noneffective Registration shall not constitute a Demand Registration for the purposes of the last sentence of Section 3(a) unless each Holder (whether or not included in such Registration) consents to such noneffective Registration counting as a Demand Registration, in which case Partners shall pay the Registration Expenses.  A request for Demand Registration may be withdrawn prior to the filing of the Demand Registration Statement (a “ Withdrawn Request ”) by the Holders participating in such demand (or by the Quintana Entity and not such Holders in the case of any election so made by it) and a Demand Registration Statement may be withdrawn up to the time of effectiveness or, if applicable, pricing, by the Holders participating in such Registration (or by the Quintana Entity and not such Holders in the case of any election so made by it) (a “ Withdrawn Demand Registration ”), and such withdrawal shall be treated as a Demand Registration which shall have been effected pursuant to this Section 3 (b) , unless the applicable Holders who submitted the request for Demand Registration reimburse Partners for its reasonable out-of-pocket Registration Expenses relating to the preparation and, if filed prior to the withdrawal, filing of such Demand Registration Statement (to the extent actually incurred); provided , however , that if a Withdrawn Request or Withdrawn Demand Registration is made (A) because of a material adverse change in the business, financial condition or prospects of Partners, or (B) because the sole or lead managing underwriter advises that the amount of Registrable Securities to be sold in such offering be reduced pursuant to this Agreement by more than twenty percent (20%) of the Registrable Securities to be included in such Registration Statement, or (C) because of the postponement of such registration pursuant to Section 6(d) , then such withdrawal shall not be treated as a Demand Registration effected pursuant to this Section 3 (and shall not be counted as a Demand Registration pursuant to Section 3(a) ), and Partners shall pay all Registration Expenses in connection therewith. Any Holder requesting inclusion in a Demand Registration may, at any time up to the time of effectiveness or, if applicable, pricing of the Demand Registration Statement, revoke such request by delivering written notice to Partners revoking such requested inclusion.  For the avoidance of doubt, a piggy-back Registration shall not count as a Demand Registration.

4.              Piggy-Back Registration .  Subject to the limitations contained in this Agreement (including Section 6) and the last sentence of this paragraph, if, after the Effectiveness Target Date, Partners proposes to file a registration statement under the Act with respect to an offering by it for its own account of any Common Units (other than a registration statement on Form S-4 or S-8 or a generic or universal shelf registration statement on Form S-3 or any successor forms thereto or filed in connection with an exchange offer or an offering of securities solely to Partners’ existing unitholders), or if, to the extent inclusion of Registrable Securities is permitted by Law, Partners plans to offer any Common Units for its own account pursuant to a “shelf take-down,” then Partners shall in each case give written notice of such proposed filing to the Holders at least 10 days before the anticipated filing date, and such notice shall offer such Holders the opportunity to register or offer such number of Registrable Securities as each such Holder may request.  Upon the written request of any Holder of Registrable Securities made within 5 days of receipt of such notice, Partners shall use its Best Efforts to cause the managing underwriter or underwriters of a proposed underwritten offering to permit the Holders requested to be included in the Registration of such offering to include such securities in such offering on the same terms and conditions as any similar securities of Partners included therein.  Notwithstanding the foregoing, if in the managing underwriter’s or underwriters’ opinion, the total amount of Common Units which the Holders, Partners and any other Persons intend to include in such offering is sufficiently large to materially and adversely affect the success or offering price of such offering, then the amount of Common Units to be offered for the accounts of Holders shall be reduced pro rata to the extent necessary to reduce the total amount of securities to be included in such offering to the amount recommended by such managing underwriter; provided , however , that if securities are being offered for the account of other Persons as well as Partners, such reduction shall not represent a greater fraction of the number of securities intended to be offered by Holders than the fraction of similar reductions imposed on such other Persons (other than Partners) over the amount of securities they intended to offer.

 
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5.              Underwritten Offerings .

(a)             If at any time during the term of this Agreement during which there are Registrable Securities, the Holders of a majority in aggregate number of Registrable Securities (or the Quintana Entity (or its affiliated designee) and not such Holders, if the Quintana Entity and its Affiliates (including, for the avoidance of doubt, the members (or former members, in the event of its dissolution or liquidation) of the Quintana Entity) beneficially own at least 4.0 million Common Units comprising Registrable Securities, on an as-converted to Common Units basis) so elect, then an offering of such Registrable Securities pursuant to any Demand Registration or any particular offering or take-down under a Shelf Registration Statement shall be in the form of an underwritten offering.  If any Registration pursuant to a Shelf Registration Statement or any Demand Registration or take-down under a Shelf Registration Statement is in the form of an underwritten offering, such offering shall be in the form of a firm commitment undertaking, and Partners will select and obtain the investment banker or investment bankers and manager or managers that will administer the offering; provided , however , that such investment bankers and managers must be reasonably satisfactory to the Holders of a majority in aggregate number of Registrable Securities to be offered (or the Quintana Entity (or its affiliated designee) and not such Holders, if the Quintana Entity and its Affiliates (including, for the avoidance of doubt, the members (or former members, in the event of its dissolution or liquidation) of the Quintana Entity) beneficially own at least 4.0 million Common Units comprising Registrable Securities, on an as-converted to Common Units basis).  No Holder may participate in any underwritten offering hereunder unless such Holder (a) agrees to sell its securities on the basis provided in any underwriting arrangements approved by the Persons entitled hereunder to approve such arrangements (i.e., a majority in aggregate number of the Holders participating in any such Registration (or the Quintana Entity (or its affiliated designee) and not such Holders, if the Quintana Entity and its Affiliates (including, for the avoidance of doubt, the members (or former members, in the event of its dissolution or liquidation) of the Quintana Entity) beneficially own at least 4.0 million Common Units comprising Registrable Securities, on an as-converted to Common Units basis) or take-down pursuant to a Shelf Registration Statement or any Demand Registration or the applicable Persons pursuant to a piggy-back Registration) and (b) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements.  If the managing underwriter or underwriters of such offering advise Partners and the Holders in writing that in their opinion the aggregate number of Common Units requested to be included in such offering is sufficiently large to materially and adversely affect the success or offering price of such offering, Partners will include in such offering only the aggregate number of such Registrable Securities which in the opinion of such managing underwriter or underwriters can be sold without any such material adverse effect, and such securities shall be allocated pro rata among the Holders on the basis of the number of Registrable Securities requested to be included in such offering by their Holders.

 
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(b)             Notwithstanding anything contained in this Agreement to the contrary, Partners shall not be required to conduct an underwritten offering pursuant to this Agreement (i) with respect to any offering that would result in net proceeds of less than $30 million to the participating Holders, (ii) more than once during any calendar year or (iii) more than seven   times in the aggregate.

In the event of such an underwritten offering conducted as contemplated in Section 5(a) , Partners shall enter into a standard underwriting agreement with the underwriters and shall:

A.            upon request, furnish to the Holders and each underwriter, if any, in such substance and scope as they may reasonably request and as are customarily made by Partners to underwriters in primary underwritten offerings, upon the date of closing of any sale of Registrable Securities in an underwritten offering:

 
(x)
an officer’s certificate, dated the date of such closing, confirming, as of the date thereof, such matters as such parties may reasonably request;

 
(y)
opinions, each dated the date of such closing, of counsel (inside and outside) to Partners covering such matters as are customarily covered in legal opinions to underwriters in connection with primary underwritten offerings of securities by Partners; and

 
(z)
customary comfort letters, dated the date of such closing, from Partners’ independent accountants (and from any other accountants whose report is contained or incorporated by reference in the Shelf Registration Statement), in the customary form and covering matters of the type customarily covered in comfort letters to underwriters in connection with primary underwritten offerings of securities; provided , that if Partners has used its Best Efforts to obtain such letters, Partners shall not be responsible if the accountants do not agree to deliver same;

B.            set forth in full in the underwriting agreement, if any, indemnification provisions and procedures which provide rights no less protective than those set forth in Section 10 hereof with respect to all parties indemnified; and

 
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C.            deliver such other documents and certificates as may be reasonably requested by such parties to evidence compliance with clause (A) above and with any customary conditions contained in the underwriting agreement or other agreement entered into by the Holders pursuant to this clause (b).

6.              Registration Procedures .

(a)             In connection with any Registration Statement, Partners will use its Best Efforts to effect the Registration of such Registrable Securities upon the terms and conditions hereof to permit the sale of such Registrable Securities by Holders thereof in accordance with the intended method of disposition thereof as quickly as practical (subject to the terms of this Agreement), and in connection with any such request, Partners will as expeditiously as practical:

(i)             Subject to any notice by Partners in accordance with this Section 6(a)(i) of the existence of any fact or event of the kind described in Section 6(a)(iii)(D) , upon the occurrence of any event that would cause any Registration Statement or the related prospectus or prospectus supplement (A) to contain a material misstatement or omission or (B) not be effective and usable for resale of Registrable Securities, Partners shall file promptly an appropriate amendment or supplement to or a document to be incorporated by reference into such Registration Statement or a report filed with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act, in the case of clause (A), correcting any such misstatement or omission, and, in the case of either clause (A) or (B), use its Best Efforts to cause any such amendment to be declared effective and such Registration Statement and the related prospectus or prospectus supplement to become usable for their intended purposes as soon as practicable thereafter.

(ii)            Prepare and file with the Commission such amendments and post-effective amendments to any Registration Statement as may be necessary to keep such Registration Statement effective as provided in this Agreement; cause the related prospectus to be supplemented by any required prospectus supplement, and as so supplemented to be filed pursuant to Rule 424 under the Act, and to comply fully with the applicable provisions of Rules 424 and 430A under the Act in a timely manner; and comply with the provisions of the Act with respect to the disposition of all securities covered by such Registration Statement during the applicable period in accordance with the intended method or methods of distribution by the sellers thereof set forth in such Registration Statement or supplement to the prospectus.

(iii)           Advise the underwriter(s), if any, and, in the case of sub-clauses (A), (B) and (C) below, the applicable Holders promptly and, if requested by such Persons, to confirm such advice in writing:

A.            when the prospectus or any prospectus supplement or post-effective amendment has been filed, and, with respect to such Shelf Registration Statement or any post-effective amendment thereto, when the same has become effective;

 
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B.            of any request by the Commission for amendments to any Registration Statement or amendments or supplements to the prospectus or for additional information relating thereto;

C.            of the issuance by the Commission of any stop order suspending the effectiveness of any Registration Statement under the Act or of the suspension by any state securities commission of the qualification of the Registrable Securities for offering or sale in any jurisdiction, or the initiation of any proceeding for any of the preceding purposes; or

D.            of the existence (but not the nature) of any fact or the happening of any event, during the effective period, that makes any statement of a material fact made in any Registration Statement, the related prospectus, any amendment or supplement thereto, or any document incorporated by reference therein untrue, or that requires the making of any additions to or changes in any Registration Statement, the related prospectus or any amendment or supplement thereto in order to make the statements therein not misleading.

If at any time the Commission shall issue any stop order suspending the effectiveness of any Registration Statement, or any state securities commission or other regulatory authority shall issue an order suspending the qualification or exemption from qualification of the Registrable Securities under state securities or Blue Sky Laws, Partners shall use its Best Efforts to obtain the withdrawal or lifting of such order at the earliest possible time.

(iv)           Furnish to counsel for the Holders and each of the underwriter(s), if any, before filing with the Commission, a copy of any Registration Statement and copies of any prospectus included therein or any amendments or supplements to either of any Registration Statement or prospectus (other than documents incorporated by reference after the initial filing of any Registration Statement), which documents will be subject to the review of such counsel and underwriter(s), if any, for a period of no less than three business days, and Partners will not file a Registration Statement relating to any Demand Registration or a Shelf Registration Statement or any prospectus or any amendment or supplement to any such Registration Statement prospectus (other than documents incorporated by reference) to which such counsel or the underwriter(s), if any, shall reasonably object within three business days after the receipt thereof.

(v)            Make available pursuant to a confidentiality and non-use agreement at reasonable times for inspection by one or more representatives of the Holders any underwriter, if any, participating in any distribution pursuant to any Registration Statement, and any attorney or accountant retained by the Holders or any of the underwriter(s), all financial and other records, pertinent corporate documents and properties of Partners as shall be reasonably necessary to enable them to exercise any applicable due diligence responsibilities and to supply all information reasonably requested by any such representative or representatives of the Holders, underwriter, attorney or accountant in connection with such Registration Statement after the filing thereof and before its effectiveness; provided , however , that the Holders shall be responsible for ensuring that any such information shall be kept confidential and not used for any purpose other than as contemplated hereby.

 
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(vi)           If requested by the Holders or the underwriter(s), if any, in connection with any Registration pursuant to a Shelf Registration Statement or any Demand Registration incorporate in the relevant Registration Statement or prospectus, pursuant to a prospectus supplement or post-effective amendment if necessary, such non-confidential information as the Holders and underwriter(s), if any, may reasonably request to have included therein, including: (1) information relating to the “Plan of Distribution” of such Registrable Securities, (2) information with respect to the number of Registrable Securities being sold, (3) the purchase price being paid therefor and (4) any other terms of the offering of the Registrable Securities to be sold in such offering; and make all required filings of such prospectus supplement or post-effective amendment as soon as reasonably practicable after Partners is notified of the matters to be incorporated in such prospectus supplement or post-effective amendment.

(vii)          Furnish to the Holders and each of the underwriter(s), if any, without charge, at least one copy of any Registration Statement, as first filed with the Commission, and of each amendment thereto (and any documents incorporated by reference therein or exhibits thereto (or exhibits incorporated in such exhibits by reference) as such Person may request in writing).

(viii)         Deliver to the Holders and each of the underwriter(s), if any, without charge, as many copies of the prospectus (including each preliminary prospectus) and any amendment or supplement thereto as such Persons reasonably may request.

(ix)            Before any public offering of Registrable Securities, cooperate with the Holders, the underwriter(s), if any, and their respective counsel in connection with the Registration and qualification of such Registrable Securities under the securities or Blue Sky Laws of such jurisdictions as the Holders or underwriter(s), if any, may reasonably request and do any and all other acts or things necessary or reasonably advisable to enable the disposition in such jurisdictions of the Registrable Securities covered by the Shelf Registration Statement; provided , however , that Partners shall not be required (A) to register or qualify as a foreign limited partnership or a dealer of securities where it is not now so qualified or to take any action that would subject it to the service of process in any jurisdiction where it is not now so subject or (B) to subject itself to taxation in any such jurisdiction if it is not now so subject.

(x)            Cooperate with the Holders and the underwriter(s), if any, to facilitate the timely preparation and delivery of certificates representing Registrable Securities to be sold and not bearing any restrictive legends (unless required by applicable securities Laws); and enable such Registrable Securities to be in such denominations and registered in such names as the Holders or the underwriter(s), if any, may reasonably request within a reasonable time before any sale of Registrable Securities made by such underwriter(s).

 
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(xi)           Use its Best Efforts to cause the Registrable Securities covered by any Registration Statement to be registered with or approved by such other U.S. Governmental Authorities as may be necessary to enable the seller or sellers thereof or the underwriter(s), if any, to consummate the disposition of such Registrable Securities, subject to the proviso in clause (ix) above.

(xii)          If any fact or event contemplated by Section 6(a)(iii)(D) hereof shall exist or have occurred, use its Best Efforts to prepare a supplement or post-effective amendment to any applicable Registration Statement or related prospectus or any document incorporated therein by reference or file any other required document so that, as thereafter delivered to the purchasers of Registrable Securities, the prospectus will not contain an untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading.

(xiii)         Provide CUSIP numbers for all participating Registrable Securities not later than the effective date of any applicable Registration Statement and provide the transfer agent with certificates for such Registrable Securities that are in a form eligible for transfer in accordance with applicable requirements.

(xiv)         Cooperate and assist in any filings required to be made with the Financial Industry Regulatory Authority, Inc. and in the performance of any due diligence investigation by any underwriter that is required to be retained in accordance with the rules and regulations of the Financial Industry Regulatory Authority, Inc..

(xv)          Otherwise use its Best Efforts to comply with all applicable rules and regulations of the Commission and all reporting requirements under the rules and regulations of the Act and the Exchange Act.

(b)             The Holders agree that, upon receipt of any notice from Partners of the existence of any fact of the kind described in Section 6(a)(iii)D) hereof, the Holders will, and will use their respective Best Efforts to cause any underwriter(s) in an underwritten offering to, forthwith discontinue disposition of Registrable Securities pursuant to such Registration Statement until:

(i)             the Holders have received copies of the supplemented or amended prospectus contemplated by Section 6(a)(viii) hereof; or

(ii)            the Holders are advised in writing by Partners that the use of the prospectus may be resumed.

If so directed by Partners, the Holders will deliver to Partners (at Partners’ expense) all copies, other than permanent file copies then in the Holders’ possession, of the prospectus covering such Registrable Securities that was current at the time of receipt of such notice of suspension.

(c)             Each Holder shall furnish to Partners in writing, as soon as practicable after the Closing   Date, the information specified in Items 507 and 508 of Regulation S-K under the Act and any other information reasonably requested by Partners for inclusion in any Registration Statement pursuant to the Act and covered by this Agreement.  Notwithstanding Sections 2(a) or 3(a) , Partners shall not be required to file any such Registration Statement or include any Holder in any Registration Statement until such Holder has complied with the immediately preceding sentence.  In addition, each Holder shall promptly furnish to Partners (i) any additional information required to be disclosed in such Registration Statement in order to make the information previously furnished to Partners by the Holders not materially misleading and (ii) any additional information as may be reasonably requested by Partners for inclusion in any new prospectus or prospectus supplement or post-effective amendment.  Notwithstanding the foregoing, in the case of a Shelf Registration Statement, upon the request of any Holder that did not return such information on a timely basis (because it was a subsequent transferee of Registrable Securities after such request was made or otherwise), Partners shall use its Best Efforts to name such Holder as a selling securityholder in the Registration Statement by means of a pre-effective amendment, by means of a post-effective amendment or, if permitted by the Commission, by means of a prospectus supplement to such Registration Statement; provided , however , that Partners will have no obligation to add Holders to such Registration Statement as selling securityholders more frequently than once every 30 calendar days. Each Holder represents that it has not prepared or had prepared on its behalf or used or referred to, and agrees that it will not prepare or have prepared on its behalf or use or refer to, any Free Writing Prospectus, and has not distributed and will not distribute any written materials in connection with the offer or sale of the Registrable Securities without the prior express written consent of Partners and, in connection with any underwritten offering, the underwriters. Any such Free Writing Prospectus consented to by Partners and the underwriters, as the case may be, is hereinafter referred to as a “ Permitted Free Writing Prospectus .” Partners represents and agrees that it has treated and will treat, as the case may be, each Permitted Free Writing Prospectus as an Issuer Free Writing Prospectus, including in respect of timely filing with the Commission, legending and record keeping.  Partners will use its commercially reasonable efforts to furnish a copy of any proposed Permitted Free Writing Prospectus to Holders participating in a Registration (but excluding any piggy-back Registration) not later than two (2) business days prior to such filing.

 
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(d)             Notwithstanding anything to the contrary in this Agreement, the Holders shall not be permitted to offer or sell pursuant to any Registration Statement contemplated by this Agreement (i) any Base Common Units, and any Registrable Securities issued in respect of such Base Common Units, covered hereby prior to June 30, 2011 and (ii) no more than 50% of the Base Common Units, and any Registrable Securities issued in respect of such Base Common Units, covered hereby prior to December 30, 2011.  Notwithstanding anything in this Agreement to the contrary, Partners will not be required to keep effective, file, amend or supplement any Registration Statement or to register (and the Holders will not be permitted to Transfer pursuant to any Registration Statement) any Registrable Securities pursuant to this Agreement:  (i) during a reasonable period of time, not to exceed 90 days, following the distribution of other securities pursuant to a registered underwritten public offering if such offering was commenced prior to the time Partners receives a request contemplated by this Agreement or (ii) during a reasonable period of time, not to exceed 60 consecutive days or 90 days in any calendar year, after which Partners has determined that an event has occurred and is continuing and a Registration of Registrable Securities pursuant to this Agreement would   in Partners’ reasonable judgment, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading or Partners reasonably determines that the disclosure of such event at such time would or could reasonably be expected to either (A) have a material adverse effect on the business or prospects of Partners and its subsidiaries, taken as a whole, or (B) adversely affect a financing, acquisition or material transaction (existing or planned). Each Holder, by its acceptance of a Registrable Security, agrees to hold in confidence any communication by Partners relating to an event described in Section 6 (d) .

 
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(e)             No other Person, including Partners (but excluding another Holder hereunder or, in the case of the Shelf Registration Statement with respect to Base Common Units and Converted Common Units, a Holder under the Davison Registration Rights Agreement), shall be permitted to offer securities under the Shelf Registration Statement or any such Demand Registration unless (i) Holders of a majority of the Registrable Securities requesting to participate in such Registration shall consent in writing or (ii) Partners has an obligation to include such securities in such Registration.

(f)             Partners shall be responsible for all Registration expenses incident to Partners’ performance of or compliance with this Agreement, including all registration and filing fees, fees and expenses of compliance with securities or Blue Sky Laws (including fees and disbursements of Partners’ counsel in connection with blue sky qualifications of the Registrable Securities), rating agency fees, printing expenses, messenger and delivery expenses, internal expenses (including all salaries and expenses of its officers and employees performing legal or accounting duties), the fees and expenses incurred in connection with the listing of the securities to be registered on each securities exchange on which similar securities issued by Partners are then listed, if any, and fees and disbursements of counsel for Partners and its independent certified public accountants (including the expenses of any special audit or “comfort” letters required by or incident to such performance), securities acts liability insurance (if Partners elects to obtain such insurance), the fees and expenses of any special experts retained by Partners in connection with such Registration, fees and expenses of other persons retained by Partners, reasonable fees and expenses of one (1) counsel (who shall be reasonably acceptable to Partners) for the Holders incurred in connection with each Registration hereunder (all such included expenses being herein called “ Registration Expenses ”); provided , however , that Partners shall not be responsible for the following Registration expenses: (i) any underwriting fees, discounts or commissions or transfer taxes attributable to the sale of Registrable Securities, (ii) out-of-pocket expenses of the Holders (or the agents who manage their accounts),  (iii) fees of counsel other than those fees specifically referred to in this Section 6(f) , and (iv) travel expenses of the Holders (or the agents who manage their accounts).

7.              Holdback Agreement .

(a)             Restrictions on Sale by Holders of Partners Securities .

(i)             Each Holder agrees not to, and to cause its Affiliates not to, Transfer any legal or beneficial interest in any Common Units, Waiver Units, Registrable Securities or any other Partners interests issued in respect thereof in violation of the Act or any other applicable securities Law.  For purposes of this Agreement, the term “ Transfer ” means any action by a Holder or its Affiliates to lend, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any legal or beneficial interest in any Common Units, Waiver Units, Registrable Securities or any other interests of Partners issued in respect thereof.

 
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(ii)            To the extent not inconsistent with applicable Law, each Substantial Holder of Registrable Securities (and each Holder if and to the extent requested by the managing underwriter or underwriters in an underwritten public offering) whose securities are included in a Registration Statement agrees not (and to cause its Affiliates not) (x) to effect any Transfer or distribution of any securities of Partners, or any securities convertible into or exchangeable or exercisable for such securities, or (y) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of securities of Partners, including a sale pursuant to Rule 144 under the Act, during the 7 days prior to, and during the 90 day period beginning on, the closing of any registered offering of Registrable Securities (the “ Holdback Period ”), if and to the extent requested by Partners in the case of a non-underwritten public offering or if and to the extent requested by the managing underwriter or underwriters in the case of an underwritten public offering; provided , however , that if Partners, its general partner or the ultimate parent of its general partner or any subsidiary of such ultimate parent or any officer or director of any such party is or becomes subject to a shorter lock-up period or receives more advantageous terms relating to the lock-up period under any lock-up agreement (including as a result of any discretionary waiver or termination of the restrictions of any or all of such agreements by Partners or the underwriters), then the Holdback Period shall be such shorter period and also on such more advantageous terms.  The provisions of this Section 7 shall not apply to the Transfer of any securities to an underwriter pursuant to an underwritten offering.  Any such lock-up agreements signed by the Holders shall contain reasonable and customary exceptions, including the right of a Holder to make transfers to certain Affiliates.

(b)             Restrictions on Sale by Partners and Others .  Partners agrees not to effect any public sale or distribution of any securities similar to those being registered, or any securities convertible into or exchangeable or exercisable for such securities (other than any such sale or distribution of such securities in connection with any merger, conversion or consolidation by Partners or any subsidiary thereof or the acquisition by Partners or a subsidiary thereof of the capital stock or other equity or all or substantially all of the assets or any other person or entity or in connection with an employee stock option or benefit plan), during the 7 days prior to, and during the 90 day period beginning on, the closing date of any underwritten offering in which the Holders of Registrable Securities are participating pursuant to a Registration Statement (except as part of such Registration), if and to the extent requested by the managing underwriter or underwriters thereof.

 
8.              Stop Transfer Instructions and Legends .  Partners may adopt any procedures and take any steps it deems reasonably necessary to prevent any Transfers of Base Common Units, Waiver Units, Class B Units, Registrable Securities or other securities issued by Partners in respect of any such securities by Holders in violation of Sections 6 and 7 , including issuing stop transfer orders to its transfer agent.  In addition, each Holder acknowledges and agrees that each certificate representing any Base Common Unit, Waiver Unit, Class B Unit, Registrable Security or other security issued by Partners in respect of any such security shall bear the following restrictive legend:

 
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“THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THESE SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT OR PURSUANT TO AN EXEMPTION FROM REGISTRATION THEREUNDER AND, IN THE CASE OF A TRANSACTION EXEMPT FROM REGISTRATION, UNLESS SOLD PURSUANT TO RULE 144 UNDER SUCH ACT OR THE ISSUER HAS RECEIVED DOCUMENTATION REASONABLY SATISFACTORY TO IT THAT SUCH TRANSACTION DOES NOT REQUIRE REGISTRATION UNDER SUCH ACT. THIS SECURITY IS SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AS SET FORTH IN THE FIFTH AMENDED AND RESTATED AGREEMENT LIMITED PARTNERSHIP OF THE PARTNERSHIP, DATED AS OF DECEMBER  28, 2010, A COPY OF WHICH MAY BE OBTAINED FROM THE PARTNERSHIP AT ITS PRINCIPAL EXECUTIVE OFFICES.”

“THESE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.  THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD, PLEDGED, HYPOTHECATED, ASSIGNED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933 (AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS OR ANY RULE OR REGULATION PROMULGATED THEREUNDER) OR AN OPINION OF COUNSEL SATISFACTORY TO THE PARTNERS’ COUNSEL THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR THE SUBMISSION TO THE PARTNERS’ COUNSEL OF SUCH OTHER EVIDENCE AS MAY BE SATISFACTORY TO PARTNER TO THE EFFECT THAT ANY SUCH TRANSFER SHALL NOT BE IN VIOLATION OF SAID ACT OF 1933.

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON TRANSFER AND CERTAIN OTHER CONDITIONS, AS SPECIFIED IN THE REGISTRATION RIGHTS AGREEMENT OF EVEN DATE HEREWITH BETWEEN GENESIS ENERGY, L.P. AND THE UNITHOLDERS PARTY THERETO.”

9.              Rule 144 .  Partners covenants that it will file the reports required to be filed by it under the Act and the Exchange Act and the rules and regulations adopted by the Commission thereunder; and it will take such further action as any Holder of Registrable Securities may reasonably request, all to the extent required from time to time to enable such Holder to sell Registrable Securities without registration under the Act within the limitation of the exemptions provided by (a) Rule 144 under the Act, as such Rule may be amended from time to time, or (b) any similar rule or regulation hereafter adopted by the Commission.  Upon the request of any Holder of Registrable Securities, Partners will deliver to such Holder a written statement as to whether it has complied with such requirements.

 
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10.             Indemnification; Contribution .

(a)             Indemnification by Partners .  Partners agrees to RELEASE, DEFEND, INDEMNIFY, PROTECT AND HOLD HARMLESS , to the full extent permitted by law, each Holder of Registrable Securities, its officers, directors and agents and each person or entity who controls such Holder (within the meaning of the Act) against all losses, claims, damages, liabilities and expenses caused by any untrue or alleged untrue statement of material fact contained in any Registration Statement (or an amendment thereto), prospectus or preliminary prospectus (or an amendment or supplement thereto), or Issuer Free Writing Prospectus (or amendment or supplement thereto) or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein (in case of a prospectus or preliminary prospectus, in the light of the circumstances under which they were made) not misleading, except insofar as the same are caused by or contained in any information with respect to such Holder furnished in writing to Partners by such Holder expressly for use therein.  Partners will also indemnify any underwriters of the Registrable Securities, their officers and directors and each person or entity who controls such underwriters (within the meaning of the Act) to the same extent as provided above with respect to the indemnification of the Holders of Registrable Securities.

(b)             Indemnification by Holders .  In connection with any Registration Statement in which a Holder of Registrable Securities is participating, each such Holder will furnish to Partners in writing such information with respect to such Holder as is required to be included therein for use in connection with any such Registration Statement (or an amendment thereto), prospectus or preliminary prospectus (or an amendment thereto), or Issuer Free Writing Prospectus (or amendment or supplement thereto) and agrees to RELEASE, DEFEND, INDEMNIFY, PROTECT AND HOLD HARMLESS , to the extent permitted by law, Partners, and its directors and officers, and affiliates of any of them (within the meaning of the Act) against any losses, claims, damages, liabilities and expenses resulting from any untrue or alleged untrue statement of a material fact or any omission or alleged omission of a material fact required to be stated in Registration Statement (or an amendment thereto), prospectus or preliminary prospectus (or an amendment or supplement thereto), or Issuer Free Writing Prospectus (or amendment or supplement thereto) or any amendment thereof or supplement thereto or necessary to make the statements therein (in the case of a prospectus or preliminary prospectus, in the light of the circumstances under which they were made) not misleading, to the extent, but only to the extent, that such untrue statement or omission is contained in any information with respect to such Holder so furnished in writing by such Holder expressly for use therein, provided , however , that the aggregate amount which any such Holder shall be required to pay pursuant to this Section 10(b) and Section 10(c) shall in no case be greater than the amount of the net proceeds received by such person upon the sale of the Registrable Securities pursuant to the Registration Statement giving rise to such claim.

(c)             Conduct of Indemnification Proceedings .  Any person or entity entitled to indemnification hereunder agrees to give prompt written notice to the indemnifying party after the receipt by such person or entity of any written notice of the commencement of any Action or threat thereof made in writing for which such person or entity will claim indemnification or contribution pursuant to this Agreement (but the failure to so notify the indemnifying party shall not relieve such indemnifying party from any liability hereunder to the extent that it is not materially prejudiced as a result thereof and in any event shall not relieve it from liability which it may have otherwise than on account of this Section 10 ) and, unless in the reasonable judgment of such indemnified party a conflict of interest may exist between such indemnified party and the indemnifying party with respect to such claim, permit the indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to such indemnified party.  Whether or not such defense is assumed by the indemnifying party, the indemnifying party will not be subject to any liability for any settlement made without its consent (but such consent will not be unreasonably withheld).  No indemnifying party will consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect of such claim or litigation.  If the indemnifying party is not entitled to, or elects not to, assume the defense of a claim, it will not be obligated to pay the fees and expenses of more than one (1) counsel with respect to such claim, unless in the reasonable judgment of any indemnified party a conflict of interest may exist between such indemnified party and any other of such indemnified parties with respect to such claim, in which event the indemnifying party shall be obligated to pay the fees and expenses of such additional counsel or counsels.

 
17

 

(d)             Contribution .  If for any reason the indemnity provided for in this Section 10 is unavailable to, or is insufficient to hold harmless, an indemnified party, then the indemnifying party shall contribute to the amount paid or payable by the indemnified party as a result of such losses, claims, damages, liabilities or expenses (i) in such proportion as is appropriate to reflect the relative benefits received by the indemnifying party on the one hand and the indemnified party on the other or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, or provides a lesser sum to the indemnified party than the amount hereinafter calculated, in such proportion as is appropriate to reflect not only the relative benefits received by the indemnifying party on the one hand and the indemnified party on the other but also the relative fault of the indemnifying party and the indemnified party as well as any other relevant equitable considerations.  The relative fault of such indemnifying party and indemnified parties shall be determined by reference to, among other things, whether any action in question, including any untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact, has been made by, or relates to information supplied by, such indemnifying party or indemnified parties; and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such action, statement or omission.  The amount paid or payable by a party as a result of the losses, claims, damages, abilities and expenses referred to above shall be deemed to include, subject to the limitations set forth in this Section 10(d) , any legal or other fees or expenses reasonably incurred by such party in connection with any investigation or proceeding to the extent such party would have been indemnified for such fees or expenses if the indemnification provided for in this Section 10 was available to such party in accordance with its terms.

The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 10(d) were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph.  No person or entity guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person or entity who was not guilty of such fraudulent misrepresentation.

 
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If indemnification is available under this Section 10 , the indemnifying parties shall indemnify each indemnified party to the full extent provided in Section 10(a) and Section 10(b) without regard to the relative fault of said indemnifying party or indemnified party or any other equitable consideration provided for in this Section 10(d) .  Notwithstanding anything in this Section 10(d) to the contrary, no indemnifying party (other than Partners) shall be required pursuant to this Section 10(d) to contribute any amount in excess of the net proceeds received by such indemnifying party for the sale of Registrable Securities in the offering to which the losses, claims, damages or liabilities of the indemnified parties relate, less the amount of any indemnification payment made by such indemnifying party pursuant to Sections 10(b) and 10(c) .

11.             Representations and Warranties .

(a)             Partners hereby represents and warrants to the Holders as follows:

(i)             Partners is an entity duly created, formed or organized, validly existing, and in good standing under the Laws of the jurisdiction of its creation, formation, or organization.  There is no pending or, to Partners’ knowledge, threatened action (or basis therefor) for the dissolution, liquidation, insolvency, or rehabilitation of Partners.

(ii)            Partners has the power and authority to execute and deliver this Agreement and to perform and consummate the transactions contemplated herein.  Partners has taken all actions necessary to authorize the execution and delivery of this Agreement, the performance of its obligations hereunder, and the consummation of the transactions contemplated herein.  This Agreement has been duly authorized, executed, and delivered by, and is enforceable against, Partners.

(iii)           The execution and the delivery of this Agreement by Partners and the performance and consummation of the transactions contemplated herein by Partners will not (a) breach any provision of its organizational documents, (b) breach any Law to which Partners is subject, (c) breach any contract or order to which Partners is a party or by which Partners is bound or to which any of Partners’ assets is subject, or (d) require any approval, consent, ratification, permission, waiver or authorization not already obtained, except in the case of clauses (b), (c) and (d) as would not have a material adverse affect on the ability of Partners to perform its obligations hereunder and consummate the transactions contemplated herein.

(b)             Each Holder hereby represents and warrants, jointly and severally, to Partners as follows:

(i)             Each such Holder that is not an individual is duly organized, validly existing, and in good standing under the Laws of the jurisdiction of its creation, formation, or organization.  There is no pending or, to such Holder’s knowledge, threatened action (or basis therefor) for the dissolution, liquidation, insolvency, or rehabilitation of such Holder.

 
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(ii)            Each such Holder that is not an individual has the power and authority, and each such Holder that is an individual has the legal capacity, to execute and deliver this Agreement and to perform and consummate the transactions contemplated herein.  Each such Holder that is not an individual has taken all actions necessary to authorize the execution and delivery of this Agreement, the performance of its obligations hereunder, and the consummation of the transactions contemplated herein.  This Agreement has been duly authorized, executed, and delivered by, and is enforceable against, such Holder.

(iii)           The execution and the delivery of this Agreement by such Holder and the performance and consummation of the transactions contemplated herein by such Holder will not (a) if the Holder is not an individual, breach any provision of its organizational documents, (b) breach any Law to which such Holder is subject, (c) breach any contract or order to which such Holder is a party or by which such Holder is bound or to which any of such Holder’s assets is subject, or (d) require any approval, consent, ratification, permission, waiver or authorization not already obtained, except in the case of clauses (b), (c) and (d) as would not have a material adverse affect on the ability of such Holder to perform its obligations hereunder and consummate the transactions contemplated herein.

(iv)           Such Holder is a “sophisticated investor” as such term is contemplated by applicable securities Laws (including the related jurisprudence);

(v)            The Units issuable in the Merger are being acquired solely for its own account for investment and not with a view toward, or for resale in connection with, any “distribution” (as such term is used in the Act and the rules and regulations thereunder) of all or any portion thereof;

(vi)           Such Holder understands and agrees that (a) the Units and the Registrable Securities may not be sold, pledged, hypothecated or otherwise transferred unless they are registered under the Act and applicable state securities Laws or an exemption from such registration is available and (b) the Units and Registrable Securities will bear the legend specified in Section 8 ;

(vii)          Such Holder has adequate means of providing for its current needs and possible contingencies, is able to bear the economic risks of this investment and has a sufficient net worth to sustain a loss of its entire investment in Partners if such loss should occur;

(viii)         Such Holder has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of an investment in Partners; and

(ix)            Such Holder has made its own inquiry and investigation into and based thereon has formed an independent judgment concerning Partners and the Registrable Securities, and has been furnished with or given adequate access to such information about Partners and the Registrable Securities as it has requested.

 
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12.             Assignment of Registration Rights .  The rights of the Holders and their permitted successors and assigns under this Agreement with respect to any Registrable Securities may be assigned to any Person who acquires all or a portion of such Registrable Securities.  Any assignment of Registration rights pursuant to this Section 12 shall be effective upon receipt by Partners of (i) written notice from the assignor (A) stating the name and address of any assignee, (B) describing the manner in which the assignee acquired the Registrable Securities from the assignor and agreeing to be a party to this Agreement and assuming the obligations under this Agreement and (C) identifying the Registrable Securities with respect to which the rights under this Agreement are being assigned, (ii) a certificate signed by the assignee assuming all obligations of the assignor under this Agreement and agreeing to be party to this Agreement and (iii) any other certificate or document that Partners might reasonably require. Any attempted transfer or other disposition of Registration rights shall be void ab initio.

13.             Miscellaneous .

(a)             Entire Agreement .  This agreement constitutes the entire agreement between the parties and supersedes any prior understandings, agreement or representations by or between the parties (other than those contained in any confidentiality agreement between the parties, dated as of the date hereof), written or oral, to the extent they have related in any way to the subject matter hereof.

(b)             Parties Bound by Agreement .  This Agreement shall be binding upon and inure to the benefit of the Parties named herein and, subject to Section 12 , their respective successors and permitted assigns.

(c)             Counterparts .  This Agreement may be executed in counterparts, each of which shall be deemed an original but which together shall constitute one and the same instrument.

(d)             Governing Law .

(i)             THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS WITHOUT GIVING EFFECT TO ANY CHOICE OR CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE STATE OF TEXAS OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF TEXAS.

(ii)            EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY CONSENTS TO SUBMIT TO THE JURISDICTION OF THE COMPETENT COURTS OF THE STATE OF TEXAS AND OF THE UNITED STATES OF AMERICA, IN EACH CASE LOCATED IN HOUSTON, TEXAS (THE “ COURTS ”) FOR ANY LITIGATION ARISING OUT OF OR RELATING TO THIS AGREEMENT (AND AGREES NOT TO COMMENCE ANY LITIGATION RELATING THERETO EXCEPT IN THE COURTS), WAIVES ANY OBJECTION TO THE LAYING OF VENUE OF ANY SUCH LITIGATION IN THE COURTS AND AGREES NOT TO PLEAD OR CLAIM IN ANY COURT THAT SUCH LITIGATION BROUGHT THEREIN HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

 
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(iii)            EACH PARTY HERETO HEREBY IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO SUCH PARTY AT THE ADDRESS OF SUCH PARTY SET FORTH IN OR DESIGNATED PURSUANT TO SECTION 13 OR BY ANY OTHER MEANS PERMITTED BY THE LAWS OF THE STATE OF TEXAS.

(iv)           EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.

(e)             No Inconsistent Agreements .  Partners will not hereafter enter into any agreement with respect to its securities which is inconsistent with the rights granted to the Holders in this Agreement.

(f)              Remedies .  Partners acknowledges and agrees that each Holder would be damaged irreparably if any provision of this Agreement is not performed in accordance with its specific terms or is otherwise breached.  Accordingly, Partners agrees that the Holders will be entitled to seek an injunction or injunctions to prevent breaches of the provisions of this Agreement and to enforce specifically this Agreement and its terms and provisions in any Action instituted in any court of the United States or any state thereof having jurisdiction over the parties and the matter, in addition to any other remedy to which they may be entitled, at law or in equity.

(g)             Amendments and Waivers .  No amendment of any provision of this Agreement shall be valid unless the same shall be in writing and signed by Partners and each Holder or on behalf of each Holder by their representative.  No waiver by any party hereto of any default, misrepresentation or breach of warranty or covenant hereunder, whether intentional or not, shall be deemed to extend to any prior or subsequent default, misrepresentation, or breach of warranty or covenant hereunder or affect in any way any rights arising by virtue of any prior or subsequent such occurrence.

(h)             Further Assurances .  Subject to the terms and conditions set forth in this Agreement, each of the parties hereto agrees to use all reasonable efforts to take, or to cause to be taken, all actions, and to do, or to cause to be done, all things necessary, proper or advisable under applicable laws and regulations to consummate and make effective the transactions contemplated by this Agreement.  If, at any time after the execution of this Agreement, any further action is necessary or desirable to carry out its purposes, the proper officers or directors of the Parties hereto shall take or cause to be taken all such necessary action.

 
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(i)              Severability .  If any provision of this Agreement shall be held invalid or unenforceable by any court of competent jurisdiction or as a result of future legislative action, so long as the economic and legal substance of the transactions contemplated hereby are not affected in any manner materially adverse to any party, such holding or action shall be strictly construed and shall not affect the validity or effect of any other provision hereof, as long as the remaining provisions, taken together, are sufficient to carry out the overall intentions of the parties as evidenced hereby.

(j)              No Third Party Beneficiaries .  Except for the indemnification provisions, this Agreement shall not confer any rights or remedies upon any Person other than the parties and their respective successors and permitted assigns.

(k)             Termination .  This Agreement shall terminate on the earlier to occur of (i) the first date on which there are no Registrable Securities   and (ii) December 31, 2020; provided, however, that the parties’ obligations under this Agreement that are intended to survive termination (such as Partners’ obligations under Section 9 , indemnification obligations set forth in Section 10 and Partners’ obligations to pay certain expenses as set forth herein) shall continue in full force and effect following termination.

(l)              Notices .  All notices, requests, demands, claims and other communications hereunder shall be in writing. Any notice, request, demand, claim or other communication hereunder shall be deemed duly given two (2) business days after it is sent by registered or certified mail, return receipt requested, postage prepaid and addressed to the intended recipient as set forth below:

(i)             if to Partners:

Genesis Energy, L.P.
Attn: Chief Executive Officer
919 Milam, Suite 2100
Houston, TX  77002
 
Telephone:
(713) 860-2500
 
Fax:
(713) 860-2647

with a copy, which shall not constitute notice, to:

Akin Gump Strauss Hauer & Feld LLP
Attn:  J. Vincent Kendrick
1111 Louisiana, Suite 4400
Houston, Texas 77002
 
Telephone:
(713) 220-5839
 
Fax:
(713) 236-0822

(ii)            if to a Unitholder, at the most current address on file in the books and records of Partners, or if to a permitted successor Holder at the most current address, and with a copy to be sent to each additional address, given by such Holder to Partners, in writing.

 
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(iii)            Any party hereto may send any notice, request, demand, claim or other communication hereunder to the intended recipient at the addresses set forth above using any other means (including personal delivery, expedited courier, messenger service, telecopy, ordinary mail or electronic mail), but no such notice, request, demand, claim or other communication shall be deemed to have been duly given unless and until it actually is received by the intended recipient.  Any party may change the address to which notices, requests, demands, claims and other communications hereunder are to be delivered by giving the other party notice in the manner herein set forth.

(m)            Construction .  The parties hereto have participated jointly in the negotiation and drafting of this Agreement.  In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto and no presumption or burden of proof shall arise favoring or disfavoring any party hereto by virtue of the authorship of any of the provisions of this Agreement.  Any reference to any federal, state, local or foreign statute or Law shall be deemed also to refer to all rules and regulations promulgated thereunder, unless the context requires otherwise.  The word “including” shall mean “including, without limitation.”  All personal pronouns used in this Agreement, whether used in the masculine, feminine or neuter gender, shall include all other genders; the singular shall include the plural, and vice versa.  All references herein to Exhibits, Schedules, Articles, Sections or subdivisions thereof shall refer to the corresponding Exhibits, Schedules, Article, Section or subdivision thereof of this Agreement unless specific reference is made to such exhibits, articles, sections or subdivisions of another document or instrument.  The terms “herein,” “hereby,” “hereunder,” “hereof,” “hereinafter,” and other equivalent words refer to this Agreement in its entirety and not solely to the particular portion of the Agreement in which such word is used.  The words “shall” and “will” are used interchangeably throughout this Agreement and shall accordingly be given the same means, regardless of which word is used.  References to a party hereto shall include its permitted successors and assigns.  Each certificate delivered pursuant to this Agreement shall be deemed a part hereof, and any representation, warranty or covenant herein referenced or affirmed in such certificate shall be treated as a representation, warranty or covenant given in the correlated Section hereof on the date of such certificate.  Additionally, any representation, warranty or covenant made in any such certificate shall be deemed to be made herein.  Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time.

(n)             Non-Recourse to General Partner .  Neither Partners’ general partner nor any other owner of equity interests in Partners shall be liable for the obligations of Partners under this Agreement or any of the transaction documents, including, in each case, by reason of any payment obligation imposed by governing state partnership statutes.

(o)             Consent to Merger .  Each of the undersigned, to the extent a holder of Series A Units and Series B Units, in each such capacity, hereby approves the Merger, the Merger Agreement and the transactions contemplated thereby.

 
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(p)             Effectiveness .  The Registration obligations contemplated by this Agreement shall be effective as of the Effective Time (as defined in the Merger Agreement).

[ remainder of this page intentionally left blank ]

 
25

 

IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first set forth in the preamble of this Agreement.

 
PARTNERS:
     
 
GENESIS ENERGY, L.P.
     
   
By: Genesis Energy, LLC,
   
its general partner
     
 
By:
/s/ Grant E. Sims
 
Name: Grant E. Sims
 
Title:   Chief Executive Officer

[Signature Page – IDR Registration Rights Agreement (1 of 5)]

 
 

 

 
UNITHOLDERS:
 
         
 
Q GEI HOLDINGS, LLC
 
         
 
By:
/s/ Steven Putman
 
 
Name: Steve Putman
 
 
Title:   Secretary
 
         
 
QUINTANA ENERGY PARTNERS II, L.P.
 
         
   
By: Quintana Capital Group II, L.P.,
 
   
its general partner
 
         
     
By: Quintana Capital Group GP Ltd.,
 
     
its general partner
 
         
 
By:
/s/ Steve Putman
 
 
Name: Steve Putman
 
 
Title:   Managing Director
 
         
 
QEP II GENESIS TE HOLDCO, LP
 
         
   
By: Quintana Capital Group II, L.P.,
 
   
its general partner
 
         
     
By: Quintana Capital Group GP Ltd.,
 
     
its general partner
 
         
 
By:
/s/ Steve Putman
 
 
Name: Steve Putman
 
 
Title:   Managing Director
 

[Signature Page – IDR Registration Rights Agreement (2 of 5)]

 
 

 

 
EIV CAPITAL FUND LP
 
         
   
By: EIV Fund Advisors LP,
 
   
its general partner
 
         
     
By: EIV Capital GP LLC,
 
     
its general partner
 
         
 
By:
/s/ Patricia B. Melcher
 
 
Name: Patricia B. Melcher
 
 
Title:   Manager
 

[Signature Page – IDR Registration Rights Agreement (3 of 5)]

 
 

 

 
/s/ Sharilyn Smith Gasaway
 
 
Sharilyn Smith Gasaway
 

[Signature Page – IDR Registration Rights Agreement (4 of 5)]

 
 

 

 
/s/ Grant E. Sims
 
 
Grant E. Sims
 
     
 
/s/ Robert V. Deere
 
 
Robert V. Deere
 
     
 
/s/ Steven R. Nathanson
 
 
Steven R. Nathanson
 
     
 
/s/ Stephen M. Smith
 
 
Stephen M. Smith
 
     
 
/s/ Karen N. Pape
 
 
Karen N. Pape
 

[Signature Page – IDR Registration Rights Agreement (5 of 5)]
 
 


Exhibit 10.2
 
Execution Copy

AMENDMENT NO. 3

TO

REGISTRATION RIGHTS AGREEMENT

THIS AMENDMENT NO. 3 TO REGISTRATION RIGHTS AGREEMENT (this “ Amendment ”) is made as of December 28, 2010, by and among Genesis Energy, L.P., a Delaware limited partnership (“ Partners ”), and the unitholders party hereto (each a “ Unitholder ” and collectively the “ Unitholders ”). Partners and the Unitholders are, collectively, the “ Parties ”. Any capitalized term used, but not defined, in this Amendment shall have the meaning given such term in the Agreement (defined below).

INTRODUCTION

A.            Partners and certain of the Parties, or their predecessors-in-interest, entered into the Registration Rights Agreement, dated as of July 25, 2007, as amended by that certain Amendment No. 1, dated November 16, 2007, and that certain Amendment No. 2, dated December 6, 2007 (as in effect immediately prior to the date of this Amendment, the “ Agreement ”).

B.             Pursuant to the terms of that certain Agreement and Plan of Merger, dated as of the date hereof (the “ Merger Agreement ”), by and among Partners, Genesis Acquisition, LLC, a Delaware limited liability company, and Genesis Energy, LLC, a Delaware limited liability company (“ Partners GP ”), Partners GP shall, subject to the terms and conditions set forth therein, merge with and into MergerCo, with Partners GP being the surviving entity (the “ Merger ”).

C.             Pursuant to the Merger Agreement, at the Effective Time (as defined in the Merger Agreement), the Series A Unit and Series B Units representing membership interests in Partners GP (collectively, the “ Partners GP Units ”) shall be converted into the right to receive a total of up to 27,000,000 limited partnership interests in Partners, consisting of (i) up to 19,960,000 Common Units – Class A (the “ Base Common Units ”), (ii) up to 7,000,000 Waiver Units issued in four classes (the “ Waiver Units ”) and (iii) 40,000 Common Units – Class B.

D.             Upon the satisfaction of specified performance objectives, the Waiver Units will automatically convert into Common Units – Class A (to the extent such conversion occurs, the “ Converted Common Units ”).

E.             The ability of the Unitholders to freely trade the above-referenced securities will be limited by applicable securities Laws.

F.             Certain holders of the Partners GP Units not party to the Agreement have entered into a Registration Rights Agreement, dated as of the date hereof (the “ New Registration Rights Agreement ”), to improve the transferability and liquidity of such securities.

 
 

 

G.             The Parties desire to amend the Agreement as set forth in this Amendment to improve the transferability and liquidity of such securities.

In consideration of the premises, the representations and warranties, and the mutual promises made in this Amendment and the Agreement, the Parties agree as follows:

 
1.
Amendments.

 
(A)
Section 1 of the Agreement is hereby amended by restating the definitions set forth below as follows:

““ Registrable Security ” means each Unit, upon original issuance thereof, and at all times subsequent thereto, including upon the transfer thereof by the original Holder or any subsequent Holder, and each unit or other security issued in respect of any Registrable Security because of or in connection with any dividend, distribution, split or purchase in any rights offering or in connection with any exchange for or replacement of such Registrable Security or any combination of units, recapitalization, merger or consolidation, or any other equity securities issued pursuant to any other pro rata distribution with respect to the Registrable Securities, until the earliest to occur of:

(i)             the date on which it has been sold pursuant to a registration statement or sold pursuant to Rule 144;

(ii)            the date on which it is saleable, in the opinion of counsel to the Partnership, without registration under the Act, pursuant to Rule 144 without volume or other restrictions;

(iii)           the date on which it is saleable, without restriction, pursuant to an available exemption from registration under the Act; or

(iv)           the date on which it is sold to the Partnership or its subsidiaries.”

““ Units ” means (i) 13,459,209 common units of the Partnership issued on the Closing Date to the Unitholders pursuant to the terms of the Contribution Agreement and (ii) Base Common Units and Converted Common Units issuable on December 28, 2010, in the case of Base Common Units, or issuable upon conversion of Waiver Units, in the case of Converted Common Units, to the unitholders party to the Amendment, or their successors or permitted assigns hereunder.”

 
(B)
Section 1 of the Agreement is hereby amended by adding the following definitions set forth below, in alphabetical order:

““ Amendment ” means that certain Amendment No. 3 to this Agreement, dated December 28, 2010, among the Partnership and the unitholders party thereto.”

 
2

 

““ Base Common Units ” has the meaning assigned to it in the Amendment.”

““ Converted Common Units ” has the meaning assigned to it in the Amendment.”

““ New Registration Rights Agreement ” has the meaning assigned to it in the Amendment.”

““ Waiver Units ” has the meaning assigned to it in the Amendment.”

 
(C)
Section 5(b) of the Agreement is hereby amended by restating the first sentence of Section 5(b) as follows: “Notwithstanding anything contained in the Agreement to the contrary, the Partnership shall not be required to conduct an underwritten offering pursuant to this Agreement (i) with respect to any offering that would result in net proceeds of less than $30 million to the participating Holders, (ii) more than once during any calendar year or (iii) more than seven times in the aggregate.”.

 
(D)
Section 6(e) of the Agreement is hereby amended by restating Section 6(e) to read as follows:  “No other Person, including the Partnership (but excluding another Holder or, in the case of the Shelf Registration Statement contemplated by the Amendment with respect to Base Common Units and Converted Common Units under (and as defined in) the New Registration Rights Agreement, a Holder under the New Registration Rights Agreement), shall be permitted to offer securities under a Shelf Registration Statement or any such Demand Registration unless (i) Holders of a majority of the Registrable Securities requesting to participate in such Registration Shall consent in writing or (ii) the Partnership has an obligation to include such securities in such Registration.”

 
(E)
Section 12(b)(i) of the Agreement is hereby amended by restating Section 12(b)(i) to read as follows:  “Each such Holder that is not an individual is duly organized, validly existing, and in good standing under the Laws of the jurisdiction of its creation, formation, or organization.  There is no pending or, to such Holder’s knowledge, threatened action (or basis therefor) for the dissolution, liquidation, insolvency, or rehabilitation of such Holder.”

 
(F)
Section 12(b)(ii) of the Agreement is hereby amended by restating Section 12(b)(ii) to read as follows:  “Each such Holder that is not an individual has the power and authority, and each such Holder that is an individual has the legal capacity, to execute and deliver this Agreement and to perform and consummate the transactions contemplated herein.  Each such Holder that is not an individual has taken all actions necessary to authorize the execution and delivery of this Agreement, the performance of its obligations hereunder, and the consummation of the transactions contemplated herein.  This Agreement has been duly authorized, executed, and delivered by, and is enforceable against, such Holder”

 
3

 

 
(G)
Section 12(b)(iii) of the Agreement is hereby amended by restating Section 12(b)(iii) to read as follows:  “The execution and the delivery of this Agreement by such Holder and the performance and consummation of the transactions contemplated herein by such Holder will not (a) if the Holder is not an individual, breach any provision of its organizational documents, (b) breach any Law to which such Holder is subject, (c) breach any contract or order to which such Holder is a party or by which such Holder is bound or to which any of such Holder’s assets is subject, or (d) require any approval, consent, ratification, permission, waiver or authorization not already obtained, except in the case of clauses (b), (c) and (d) as would not have a material adverse affect on the ability of such Holder to perform its obligations hereunder and consummate the transactions contemplated herein.”

 
(H)
Section 14(k) of the Agreement is hereby amended by replacing “December 31, 2017” where it appears therein with “December 31, 2020”.

 
2.
Agreements.

 
(A)
Shelf Registration Statement .  In addition to Partners’ existing obligations under Section 2 of the Agreement, Partners shall, subject to the terms and conditions of the New Registration Rights Agreement, file, have declared effective and maintain an additional Shelf Registration Statement with respect to that portion of the Registrable Securities consisting of Base Common Units and Converted Common Units issued or issuable upon conversion of Waiver Units (and each unit or other security issued in respect of any such Registrable Security because of or in connection with any dividend, distribution, split or purchase in any rights offering or in connection with any exchange for or replacement of such Registrable Security or any combination of units, recapitalization, merger or consolidation, or any other equity securities issued pursuant to any other pro rata distribution with respect to such Registrable Securities) providing for the resale of all such Registrable Securities, in each case substantially contemporaneously with, or during substantially the same periods as, as applicable, the times and periods the Shelf Registration Statement (as defined in the New Registration Rights Agreement) is required to be filed or declared effective and maintained, as applicable, upon the same terms and conditions and subject to the same obligations hereunder with respect to such Shelf Registration Statement as set forth in Section 2(a) and Section 2(b) of the New Registration Rights Agreement.  The term “Shelf Registration Statement,” as used in the Agreement, shall be deemed to include the Shelf Registration Statement referred to herein.

 
4

 

To the extent permitted by Law, the obligations of Partners hereunder may be satisfied by including such Registrable Securities (i) on the Shelf Registration Statement initially filed pursuant to the Agreement (Reg. No. 333-150239), (ii) on the Shelf Registration Statement (as defined in the New Registration Rights Agreement) required under Section 2 of the New Registration Rights Agreement, or (iii) on a separate Shelf Registration Statement.

For the purposes of the Demand Registration rights provided for under Section 3 of the Agreement, (i) the Effectiveness Target Date as defined therein shall also be deemed to include the Effectiveness Target Date as defined in the New Registration Rights Agreement and (ii) Section 2(A) shall be deemed an obligation under Section 2 of the Agreement.

 
(B)
Resale Limitations .  Notwithstanding anything to the contrary in this Amendment, the Holders shall not be permitted to offer or sell pursuant to any Registration Statement contemplated pursuant to Section 2(A) (i) any Base Common Units, and any Registrable Securities issued in respect of such Base Common Units, covered hereby prior to June 30, 2011 and (ii) no more than 50% of the Base Common Units, and any Registrable Securities issued in respect of such Base Common Units,  covered hereby prior to December 30, 2011.

 
(C)
Representations and Warranties .  Each of Partners, on the one hand, and the undersigned Unitholders, on the other, hereby makes or reaffirms (as the case may be), as of the date hereof, with respect to the Units issuable to the Unitholders on the date hereof pursuant to the Merger and the Merger Agreement, those representations and warranties of Partners and the Holders, respectively, under Section 12 of the Agreement (provided, that references to the Agreement therein shall be deemed to refer to the Agreement as amended through and including the date hereof).

 
3.
Entire Agreement; No Other Amendments.   This Amendment constitutes the entire agreement and understanding of the Parties with respect to its subject matter and supersedes all oral communication and prior writings (except as otherwise provided herein) with respect thereto.  Each of the undersigned Unitholders hereby acknowledges and agrees that, except as expressly amended or modified by this Amendment, all the terms and conditions of the Agreement shall remain unchanged and are hereby ratified and confirmed in all respects and that this Amendment and the Agreement shall be read and construed as one instrument.

 
4.
Amendments. No amendment, modification or waiver in respect of this Amendment will be effective unless in writing (including a writing evidenced by a facsimile transmission) and executed by each of the Parties.

 
5

 

 
5.
Counterparts. This Amendment may be executed and delivered in counterparts (including by facsimile transmission), each of which will be deemed an original. All signatures need not be on one counterpart.

 
6.
Governing Law. This Amendment shall be governed by and construed in accordance with the law of the State of Texas (without reference to choice of law doctrine).

 
7.
Effectiveness .  The amendments and Registration obligations contemplated by this Amendment shall be effective as of the Effective Time (as defined in the Merger Agreement).

 
8.
Consent to Merger .  Each of the undersigned, to the extent a holder of Series A Units, in such capacity, hereby approves the Merger, the Merger Agreement and the transactions contemplated thereby.

[Signature Page Follows]

 
6

 

IN WITNESS WHEREOF , the Parties hereto have caused this Amendment No. 3 to be duly executed as of the date first above written.

 
UNITHOLDERS:
 
       
 
TERMINAL SERVICES, INC.
 
       
 
By:
/s/ James E. Davison
 
 
Name:
 
 
Title:
 
       
 
/s/ James Ellis Davison
 
 
James Ellis Davison
 
       
 
JAMES ELLIS DAVISON, JR.
 
 
GRANTOR RETAINED ANNUITY TRUST
 
       
 
By:
/s/ James Ellis Davison, Jr.
 
 
Name: James Ellis Davison, Jr.
 
 
Title:   Trustee
 
       
 
/s/ James Ellis Davison, Jr.
 
 
James Ellis Davison, Jr.
 
 
[Signature Page - Amendment No. 3 to Davison Registration Rights Agreement (1 of 3)]

 
 

 
 
 
/s/ Todd Allen Davison
 
 
Todd Allen Davison
 
       
 
TODD DAVISON LEGACY TRUST-2010
 
 
C/O ARGENT TRUST
 
       
 
By:
/s/ Kimberly Husband
 
 
Name: Kimberly Husband, Senior VP
 
 
Title:   Trustee
 
       
 
TODD DAVISON CHILDREN’S TRUST
 
 
C/O ARGENT TRUST
 
       
 
By:
/s/ Kimberly Husband
 
 
Name: Kimberly Husband, Senior VP
 
 
Title:   Trustee
 
       
 
/s/ Steven Kent Davison
 
 
Steven Kent Davison
 
       
 
STEVEN DAVISON FAMILY TRUST
 
 
C/O ARGENT TRUST
 
       
 
By:
/s/ Kimberly Husband
 
 
Name: Kimberly Husband, Senior VP
 
 
Title:    Trustee
 
 
[Signature Page - Amendment No. 3 to Davison Registration Rights Agreement (2 of 3)]
 
 
 

 
 
PARTNERSHIP:
 
     
GENESIS ENERGY, L.P.
 
     
By:  Genesis Energy, LLC,
 
its general partner
 
     
By:
/s/ Grant E. Sims
 
 
Grant E. Sims
 
 
Chief Executive Officer
 

[Signature Page - Amendment No. 3 to Davison Registration Rights Agreement (3 of 3)]
 
 


Exhibit 10.3

Execution Copy

AMENDMENT NO. 2
TO
UNITHOLDER RIGHTS AGREEMENT
 
THIS AMENDMENT NO. 2 TO UNITHOLDER RIGHTS AGREEMENT (this “ Amendment ”) is made as of December 28, 2010 by and among Genesis Energy, L.P., a Delaware limited partnership (the “ Partnership ”), the unitholders set forth on the signature page hereto (each a “ Unitholder ” and collectively the “ Unitholders ”) and Genesis Energy, LLC, a Delaware limited liability company (the “ Company ”).  The Partnership, the Unitholders and the Company are, collectively, the “ Parties ”.  Any capitalized term used, but not defined, in this Amendment shall have the meaning given such term in the Agreement (defined below).
 
INTRODUCTION
 
A.           The Parties, or their predecessors-in-interest, entered into the Unitholder Rights Agreement dated as of July 25, 2007, which was subsequently amended on October 15, 2007 (as in effect immediately prior to the date of this Amendment, the “ Agreement ”).
 
B.            The Parties desire to amend the Agreement as set forth in this Amendment.
 
In consideration of the premises, the representations and warranties, and the mutual promises made in this Amendment and the Agreement, the Parties agree as follows:
 
1.
Amendment . (a) Section 2.1 of the Agreement is hereby amended by restating the table set forth therein as follows:
 
Aggregate Number of Directors that may be Designated by Unitholders
Davison Family Holdings as a Percent of All Common Units
A.  three
15% or more
B.  two
10% or more but less than 15%
C.  none
less than 10%
 
(b)  Section 2.2 of the Agreement is hereby amended by restating the first sentence to read as follows:  “The Unitholders shall affect such designation only by delivering to the GP a written notice (the “ Designation Notice ”) identifying a first Qualified Candidate and a second Qualified Candidate and, if applicable, a third Qualified Candidate.”
 
(c)  Section 2.3 of the Agreement is hereby amended by restating the first two sentences to read as follows:  “After the Initial Period, in the event that three Qualified Candidates are Directors and either the members of the Davison Family cease to Beneficially Own at least 15% of the then outstanding Common Units or the Unitholders (or their permitted assignees) are not then Affiliates of any member of the Davison Family, the term of the third Qualified Candidate shall automatically expire.  After the Initial Period, in the event that two or three Qualified Candidates are Directors and either the members of the Davison Family cease to Beneficially Own at least 10% of the then outstanding Common Units or the Unitholders (or their permitted assignees) are not then Affiliates of any member of the Davison Family, the term of all such Qualified Candidates shall automatically expire.”
 
 
1

 

(d)  Article II of the Agreement is hereby amended to insert a new Section 2.5 in its appropriate numerical-order position to read as follows:
 
“Section 2.5.  Notwithstanding anything in Section 3.3 to the contrary, so long as the Unitholders (or their permitted assignees) have the right to designate three   Directors under Section 2.1 above, then the Board may not have more than 11 Directors concurrently serving at any given time without obtaining the Unitholders’ (or their permitted assignees) express written consent as to the appointment of any Directors whose appointment would cause the size of the Board to exceed 11 Directors at any given time.”
 
2. 
Entire Agreement . This Amendment constitutes the entire agreement and understanding of the Parties with respect to its subject matter and supersedes all oral communication and prior writings (except as otherwise provided herein) with respect thereto.  The Parties ratify and confirm the Agreement as amended hereby as if each were a party thereto.

3.
Amendments . No amendment, modification or waiver in respect of this Amendment will be effective unless in writing (including a writing evidenced by a facsimile transmission) and executed by each of the Parties.

4.
Counterparts . This Amendment may be executed and delivered in counterparts (including by facsimile transmission), each of which will be deemed an original.  All signatures need not be on one counterpart.
 
5.
Governing Law . This Amendment will be governed by and construed in accordance with the law of the State of Delaware (without reference to choice of law doctrine).
 
6.
Effectiveness .  This Amendment and the amendment obligations contemplated by this Amendment shall be effective as of the Effective Time (as defined in that certain Agreement and Plan of Merger, dated as of the date hereof, by and among the Partnership, Genesis Acquisition, LLC, a Delaware limited liability company   and the Company).
 
[Signature Pages Follow]
 
 
2

 
 
IN WITNESS WHEREOF , the Parties hereto have caused this Amendment No. 2 to be duly executed as of the date first above written.
 
 
UNITHOLDERS:
 
TERMINAL SERVICES, INC.
       
 
By:
/s/ James E. Davison
 
 
Name:
   
 
Title:
   
       
 
/s/ James Ellis Davison
 
 
James Ellis Davison
 
       
 
JAMES ELLIS DAVISON, JR.
 
GRANTOR RETAINED ANNUITY TRUST
       
 
By:
/s/ James Ellis Davison, Jr.
 
 
Name:
James Ellis Davison, Jr.
 
 
Title:
Trustee
 
       
 
/s/ James Ellis Davison, Jr.
 
 
James Ellis Davison, Jr.
 
       
 
/s/ Todd Allen Davison
 
 
Todd Allen Davison
 
       
 
TODD DAVISON LEGACY TRUST-2010
 
C/O ARGENT  TRUST
       
 
By:
/s/ Kimberly Husband
 
 
Name:
Kimberly Husband, Senior VP
 
 
Title:
Trustee
 

[Signature Page - Amendment No. 2 to Unitholder Rights Agreement (1 of 3)]

 
 

 

 
C/O ARGENT TRUST
       
 
By:
/s/ Kimberly Husband
 
 
Name:
Kimberly Husband, Senior VP
 
 
Title:
Trustee
 
       
 
/s/ Steven Kent Davison
 
 
Steven Kent Davison
 
       
 
STEVEN DAVISON FAMILY TRUST
 
C/O ARGENT TRUST
       
 
By:
/s/ Kimberly Husband
 
 
Name:
Kimberly Husband, Senior VP
 
 
Title:
Trustee
 

[Signature Page - Amendment No. 2 to Unitholder Rights Agreement (2 of 3)]

 
 

 

COMPANY:
     
GENESIS ENERGY, LLC
     
By:
/s/ Robert C. Sturdivant
 
Name:
Robert C. Sturdivant
 
Title:
Chairman of the Board
 
     
PARTNERSHIP:
GENESIS ENERGY, LP.
By:
Genesis Energy, LLC,
 
its
general partner
 
     
By:
/s/ Grant E. Sims
 
Name:
Grant E. Sims
 
Title:
Chief Executive Officer
 

[Signature Page - Amendment No. 2 to Unitholder Rights Agreement (3 of 3)]
 
 


Exhibit 10.4
 
Execution Copy
AMENDMENT NO. 1
TO THE INDEMNIFICATION AGREEMENT

This Amendment No. 1, dated December 28, 2010 (this “ Amendment ”) to the Indemnification Agreement (the “ Agreement ”), effective as of the date hereof, among Genesis Energy, L.P., a Delaware limited partnership (the “ Partnership ”), Genesis Energy, LLC, a Delaware limited liability company (the “ Company ”), and the undersigned director or officer of the Company (the “ Indemnitee ”), is hereby entered into among the Partnership, the Company and the Indemnitee.

WHEREAS, as of even date herewith, the Board of Directors of the General Partner approved this Amendment on behalf of both the General Partner and the Partnership;

NOW, THEREFORE, it is hereby agreed as follows:

1.            Amendment .  Section 16 of the Agreement is hereby amended and restated in its entirety to read as follows:

Maintenance of Liability Insurance .  The Partnership and the Company hereby covenant and agree that (i) so long as Indemnitee shall continue to serve as a director or officer of the Company, the Company or the Partnership shall maintain, and for six years thereafter so long as Indemnitee shall be subject to any possible Proceeding by reason of the fact that Indemnitee was a director or officer of the Company shall cause Indemnitee to be covered by, the policies of directors’ and officers’ liability insurance maintained by the Partnership or the Company and its respective subsidiaries, as applicable, in effect as of the date hereof, except that the Company and the Partnership may substitute policies of at least the same coverage and amounts provided by established and reputable insurers containing terms and conditions which are not less advantageous to the directors and officers of the Company than the existing policy; provided , that the Partnership and the Company are not required to pay annual premiums in excess of 300% of the last annual premium paid by the Partnership or the Company, as applicable, prior to the date hereof and (ii) the organizational documents of the Company shall at all times provide for indemnification and exculpation of officers and directors no less favorable with respect thereto than are set forth in the organizational documents of the Company as of the date hereof.  Notwithstanding the foregoing, the Company and the Partnership will have no obligation to obtain or maintain the insurance contemplated by this Section 16 if the Board of Directors determines in good faith that such insurance is not reasonably available. The Company will promptly notify Indemnitee of any such determination not to provide insurance coverage.

2.            Agreement in Effect .  Except as hereby amended, the Agreement shall remain in full force and effect.

3.            Applicable Law .  This Amendment shall be construed in accordance with and governed by the laws of the State of Delaware, without regard to principles of conflicts of laws.

 
 

 
 
4.            Invalidity of Provisions . If any provision of this Amendment is or becomes invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not be affected thereby.

[Signature Pages Follow]
 
 
2

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

 
GENESIS ENERGY, L.P.
 
       
 
By:
Genesis Energy, LLC
 
    its general partner  
       
 
By:
   
 
Name:
Grant E. Sims
 
 
Title:
Chief Executive Officer
 
       
 
GENESIS ENERGY, LLC
 
       
 
By:
   
 
Name:
Robert C. Sturdivant
 
 
Title:
Chairman of the Board
 
 
[Signature Page – Amendment No. 1 to Indemnification Agreement (1 of 2)]
 
 
 

 
 
 
INDEMNITEE
 
       
   
 
 
 
[Signature Page – Amendment No. 1 to Indemnification Agreement (2 of 2)]
 
 


Exhibit 99.1
 
LOGO 1
 
FOR IMMEDIATE RELEASE
December 28, 2010

Genesis Energy, L.P. Announces the
Elimination of its Incentive Distribution Rights

HOUSTON – (BUSINESS WIRE) – Genesis Energy, L.P. (NYSE: GEL) announced today that it has permanently eliminated its incentive distribution rights (IDR’s) and converted its two percent general partner interest into a non-economic interest.  Prior to this IDR restructuring transaction, our general partner was entitled to over 50% of any increased distributions we would pay to our common units.  In exchange for the IDR’s and the two percent economic interest attributable to our general partner interest, we issued 20 million common units and 7 million “Waiver” units to the stakeholders of our general partner, less approximately 145,000 common and 50,000 Waiver units that have been reserved for a new deferred equity compensation plan for employees.  The Waiver units have the right to convert into Genesis common units in four equal installments in the calendar quarter during which each of our common units receives a quarterly distribution of at least $0.43, $0.46, $0.49 and $0.52, if our distribution coverage ratio (after giving effect to the then convertible Waiver units) would be at least 1.1 times.  The IDR restructuring transaction, which does not require further consents, is effective as of this date.

As a result of the IDR restructuring transaction, we now have approximately 64.6 million common units outstanding (with the former stakeholders of the general partner owning approximately 30% of such units), and our general partner has become (by way of merger) one of our wholly-owned subsidiaries.  There has been no change in the composition of the Board of Directors of our general partner.  The former stakeholders of the general partner will continue to elect the directors of the general partner in the future.

“This transaction reflects a strategic move by us to lower our equity cost of capital through the permanent elimination of our incentive distributions,” said Grant E. Sims, CEO of Genesis.  “Over the last four years, we have averaged approximately $300 million in acquisitions and growth capital deployed annually.  By lowering our cost of capital, we hope to strengthen our competitive position in the midstream energy space and believe this transaction can enhance our ability to hopefully continue to build long-term value for Genesis.”

Sims continued, “Because of the performance based structure of the Waiver units, the interests of management and the other former stakeholders of our general partner are now directly aligned with the holders of our common units, and we’re all incented to do what we possibly can to continue our track record of building value for and growing distributions to the holders of our common units.”

The transaction was unanimously approved by the Board of Directors of Genesis’ general partner based, in part, on the unanimous approval and recommendation of its Conflicts Committee, which is comprised solely of independent directors.  The Conflicts Committee engaged Raymond James & Associates, Inc. as its financial advisor (including issuance of a fairness opinion) and Gibson, Dunn & Crutcher LLP as special counsel to the committee.  The Board of Directors engaged Robert W.Baird & Co. as its financial advisor and Akin, Gump, Strauss, Hauer & Feld LLP as its legal advisor.

 
 

 


 
Genesis Energy, L.P. is a diversified midstream energy master limited partnership headquartered in Houston, Texas. Genesis engages in four business segments. The Pipeline Transportation Division is engaged in the pipeline transportation of crude oil and carbon dioxide. The Refinery Services Division primarily processes sour gas streams to remove sulfur at refining operations, principally located in Texas, Louisiana, and Arkansas. The Supply and Logistics Division is engaged in the transportation, storage and supply and marketing of energy products, including crude oil and refined products. The Industrial Gases Division produces and supplies industrial gases such as carbon dioxide and syngas. Genesis’ operations are primarily located in Texas, Louisiana, Arkansas, Mississippi, Alabama, Florida and the Gulf of Mexico.

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although we believe that our expectations are based upon reasonable assumptions, we can give no assurance that our goals will be achieved, including statements regarding closing of the offering. Actual results may vary materially. We undertake no obligation to publicly update or revise any forward-looking statement.

Contact:
Genesis Energy, L.P.
Bob Deere
Chief Financial Officer
(713) 860-2516