Teekay Offshore Partners L.P. (Form: 6-K, Received: 01/23/2018 12:04:41)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 6-K

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16

of the Securities Exchange Act of 1934

Date of report: January 23, 2018

Commission file number 1-33198

TEEKAY OFFSHORE PARTNERS L.P.

(Exact name of Registrant as specified in its charter)

4th Floor

Belvedere Building

69 Pitts Bay Road

Hamilton, HM08 Bermuda

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F ☒ Form 40- F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1).

Yes ☐ No ☒

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7).

Yes ☐ No ☒

THIS REPORT ON FORM 6-K IS HEREBY INCORPORATED BY REFERENCE INTO THE FOLLOWING REGISTRATION STATEMENT OF THE COMPANY:

•

REGISTRATION STATEMENT ON FORM F-3 (FILE NO. 333-221745) DATED JANUARY 10, 2018

Item 6 — Exhibits

The following exhibits are filed as part of this Report:



1.1		Underwriting Agreement

4.1		Sixth Amended and Restated Agreement of Limited Partnership of Teekay Offshore Partners L.P. dated as of January 23, 2018

5.1		Opinion of Watson Farley & Williams LLP, relating to the legality of the securities being registered

8.1		Opinion of Perkins Coie LLP, relating to tax matters

8.2		Opinion of Watson Farley & Williams LLP, relating to tax matters

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, thereunto duly authorized.


	TEEKAY OFFSHORE PARTNERS L.P.

	By:	Teekay Offshore GP L.L.C., its general partner

Date: January 23, 2018	By:	/s/ Edith Robinson
		Edith Robinson
		Secretary

Exhibit 1.1

Execution Version

Teekay Offshore Partners L.P.

Underwriting Agreement

4,600,000 8.8750% Series E Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred

Units, Representing Limited Partner Interests in the Partnership,

Plus an option to purchase from the Partnership up to

690,000 additional 8.8750% Series E Preferred Units

New York, New York

January 16, 2018

Morgan Stanley & Co. LLC

UBS Securities LLC

c/o	Morgan Stanley & Co. LLC

1585 Broadway

New York, NY 10036

c/o	UBS Securities LLC

1285 Avenue of the Americas

New York, NY 10019

Ladies and Gentlemen:

Teekay Offshore Partners L.P., a limited partnership organized under the laws of the Marshall Islands (the “ Partnership ”), proposes to issue and sell (the “ Offering ”) to the several underwriters named in Schedule I hereto (the “ Underwriters ”), for whom you (the “ Representatives ”) are acting as representatives, 4,600,000 8.8750% Series E Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units (the “ Firm Units ”), each representing a limited partner interest in the Partnership (the “ Series E Preferred Units ”). The Partnership also proposes to grant to the Underwriters an option to purchase up to 690,000 additional Series E Preferred Units (the “ Option Units ;” the Firm Units and the Option Units being hereinafter collectively called the “ Units ”). To the extent there are no additional Underwriters listed in Schedule I other than you, the term Representatives as used herein shall mean you, as Underwriters, and the terms Representatives and Underwriters shall mean either the singular or plural as the context requires.

Teekay Offshore GP L.L.C., a Marshall Islands limited liability company (the “ General Partner ”), serves as the sole general partner of the Partnership. The Partnership owns a 100%

interest in Teekay Offshore Holdings L.L.C., a Marshall Islands limited liability company (“ Teekay Offshore Holdings ”). Teekay Offshore Holdings owns a 100% interest in Teekay Shuttle Tankers L.L.C., a Marshall Islands limited liability company (“ ShuttleCo ”). ShuttleCo owns (i) a 99.09% limited partner interest in Teekay Offshore Operating L.P., a Marshall Islands limited partnership (the “ Operating Company ”) and (ii) a 100% membership interest in Teekay Offshore Operating GP L.L.C., a Marshall Islands limited liability company (the “ OLP GP ”). The OLP GP owns a 0.91% general partner interest in the Operating Company.

Each of the entities set forth in Schedule II as being owned directly or indirectly by the Partnership, Teekay Offshore Holdings, ShuttleCo or the Operating Company are hereinafter referred to collectively as the “ Operating Subsidiaries ”.

The General Partner, the Partnership, Teekay Offshore Holdings, ShuttleCo, the OLP GP, the Operating Company and the Operating Subsidiaries are hereinafter referred to collectively as the “ Teekay Entities .” The General Partner and the Partnership are hereinafter referred to collectively as the “ Teekay Parties .”

Any reference herein to the Registration Statement, the Base Prospectus, any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein pursuant to Item 6 of Form F-3 which were filed under the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”), on or before the Effective Date of the Registration Statement or the issue date of the Base Prospectus, any Preliminary Prospectus or the Prospectus, as the case may be; and any reference herein to the terms “amend,” “amendment” or “supplement” with respect to the Registration Statement, the Base Prospectus, any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the filing of any document under the Exchange Act after the Effective Date of the Registration Statement or the issue date of the Base Prospectus, any Preliminary Prospectus or the Prospectus, as the case may be, deemed to be incorporated therein by reference. Certain terms used herein are defined in Section 20 hereof.

This is to confirm the agreement among the Teekay Parties and the Underwriters concerning the purchase of the Firm Units and the Option Units from the Partnership by the Underwriters.

1. Representations and Warranties of the Teekay Parties . Each of the Teekay Parties, jointly and severally, represents and warrants to each Underwriter and agrees with each Underwriter that:

(a) Registration Statement and Prospectus . The Partnership meets the requirements for use of Form F-3 under the Securities Act of 1933, as amended (the “ Act ”) and the rules and regulations promulgated thereunder (the “ 1933 Act Regulations ”). A registration statement on Form F-3 (File No. 333-221745), including a related base prospectus, has been prepared and filed by the Partnership in conformity in all material respects with the requirements of the Act and the 1933 Act Regulations. The Registration Statement was declared effective by the Commission under the Act on January 10, 2018. The Partnership may have filed one or more amendments thereto, including one or more Preliminary Prospectuses with respect to the Series E Preferred Units, each of which has previously been furnished to you. The Partnership will file

with the Commission a final prospectus in accordance with Rule 424(b). As filed, such Prospectus shall contain all information required by the Act and the rules thereunder and, except to the extent the Representatives shall agree in writing to a modification, shall be in all substantive respects in the form furnished to you prior to the Applicable Time or, to the extent not completed at the Applicable Time, shall contain only such specific additional information and other changes (beyond that contained in the Base Prospectus and any Preliminary Prospectus) as the Partnership has advised you, prior to the Applicable Time, will be included or made therein. The Registration Statement, at the Applicable Time, meets the requirements set forth in Rule 415(a)(1)(x). The Commission has not issued any order preventing or suspending the use of any Preliminary Prospectus or the Prospectus or suspending the effectiveness of the Registration Statement, and no proceeding or examination for such purpose has been instituted or, to the knowledge of the Teekay Parties, threatened by the Commission.

(b) No Material Misstatements or Omissions in Registration Statement, Prospectus or Documents Incorporated by Reference. As of the date of this Agreement and on each Effective Date, the Registration Statement did, and when the Prospectus is first filed in accordance with Rule 424(b) and on the Closing Date (as defined herein) and on any date on which Option Units are purchased hereunder, if such date is not the Closing Date (an “ Option Closing Date ”), the Prospectus (and any supplement thereto) will, comply in all material respects with the applicable requirements of the Act and the rules thereunder. The documents incorporated by reference in the Registration Statement, any Preliminary Prospectus or the Prospectus complied, and any further documents so incorporated, when filed with the Commission, will comply in all material respects with the applicable requirements of the Exchange Act or the Act, as applicable, and the rules and regulations of the Commission thereunder. On each Effective Date and at the Applicable Time, the Registration Statement did not and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein not misleading; and on the date of any filing pursuant to Rule 424(b) and on the Closing Date and any Option Closing Date, the Prospectus (together with any supplement thereto) will not include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading and the statements made or to be made in such documents that are covered by Rule 175(b) under the Act were made or will be made with a reasonable basis and in good faith; and the documents incorporated by reference in the Registration Statement, any Preliminary Prospectus or the Prospectus did not, and any further documents filed and incorporated by reference therein will not, when filed with the Commission, contain any untrue statement of material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; provided , however , that the Teekay Parties make no representations or warranties as to the information contained in or omitted from the Registration Statement or the Prospectus (or any supplement thereto) in reliance upon and in conformity with information furnished in writing to the Partnership by or on behalf of any Underwriter through the Representatives specifically for inclusion in the Registration Statement or the Prospectus (or any supplement thereto), it being understood and agreed that the only such information furnished by any Underwriter consists of the information described as such in Section 8(b) hereof.

(c) No Material Misstatements or Omissions in Disclosure Package. (i) As of the Applicable Time, the Disclosure Package, when taken together as a whole, and (ii) each Issuer Free Writing Prospectus or any “road show” (as defined in Rule 433 of the 1933 Act Regulations) not constituting an Issuer Free Writing Prospectus (a “ Non-Prospectus Road Show ”), when taken together as a whole with the Disclosure Package, did not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The preceding sentence does not apply to statements in or omissions from the Disclosure Package based upon and in conformity with written information furnished to the Partnership by any Underwriter through the Representatives specifically for use therein, it being understood and agreed that the only such information furnished by or on behalf of any Underwriter consists of the information described as such in Section 8(b) hereof.

(d) No Ineligible Issuer. (i) At the time of filing the Registration Statement and any post-effective amendment thereto, and (ii) as of the Applicable Time (with such time being used as the determination date for purposes of this clause (ii)), the Partnership was not and is not an Ineligible Issuer (as defined in Rule 405), without taking account of any determination by the Commission pursuant to Rule 405 that with respect to the offering contemplated hereby it is not necessary that the Partnership be considered an Ineligible Issuer.

(e) No Conflicting Information in Issuer Free Writing Prospectuses. Each Issuer Free Writing Prospectus as of its date does not include any information that conflicts with the information contained in the Registration Statement, any Preliminary Prospectus or the Prospectus, including any document incorporated by reference therein that has not been superseded or modified.

(f) Formation and Qualification . Each of the Teekay Entities has been duly formed or incorporated and is validly existing as a limited partnership, limited liability company or corporation, as the case may be, in good standing under the laws of its respective jurisdiction of formation or incorporation, and is duly registered or qualified to do business and is in good standing as a foreign limited liability company, limited partnership or corporation, as the case may be, in each jurisdiction in which its ownership or lease of property or the conduct of its businesses requires such registration or qualification, except where the failure so to register or qualify would not (i) reasonably be expected to have a Material Adverse Effect or (ii) subject the limited partners of the Partnership to any material liability or disability. “ Material Adverse Effect ,” as used throughout this Agreement, means a material adverse effect on the condition (financial or otherwise), results of operations, business, properties, assets or prospects of the Teekay Entities, taken as a whole, except as set forth in or contemplated in the Disclosure Package (exclusive of any supplement thereto) and the Prospectus (exclusive of any supplement thereto). Each of the Teekay Entities has all limited liability company, limited partnership or corporate, as the case may be, power and authority necessary to own or lease its properties currently owned or leased or to be owned or leased at each Closing Date or Option Closing Date, to assume the liabilities assumed by it and to conduct its business as currently conducted and as to be conducted at each Closing Date or Option Closing Date, in each case in all material respects as described in the Registration Statement, the Disclosure Package and the Prospectus.

(g) Ownership of General Partner Interest in the Partnership . The General Partner is the sole general partner of the Partnership with a 0.76% general partner interest in the Partnership; such general partner interest has been duly authorized and validly issued in accordance with the partnership agreement of the Partnership, as amended or restated on or prior to the date hereof (the “ Partnership Agreement ”); and the General Partner owns such general partner interest free and clear of all pledges, liens, encumbrances, security interests, charges, equities or other claims (collectively, “ Liens ”) (except restrictions on transferability contained in the Partnership Agreement, as described in the Disclosure Package and the Prospectus, or under applicable securities laws).

(h) Ownership of Common Units and Incentive Distribution Rights in the Partnership. (i) Teekay Corporation, a Marshall Islands corporation (“ Teekay ”), owns, indirectly, 56,587,484 Common Units (as defined in the Partnership Agreement) free and clear of all Liens, except restrictions on transferability contained in the Partnership Agreement or under applicable securities laws and pursuant to the Margin Loan Agreement dated as of December 21, 2012 by and among Teekay Finance Limited, a Bermuda exempted company, the lenders party thereto, and Citibank, N.A., as administrative agent, as amended (the “ Margin Loan Agreement ”), (ii) the General Partner owns 100% of the Incentive Distribution Rights (as defined in the Partnership Agreement) (the “ Incentive Distribution Rights ”) free and clear of all Liens, except restrictions on transferability contained in the Partnership Agreement or under applicable securities laws, and (iii) Brookfield TK TOLP L.P., a Bermuda limited partnership (“ Brookfield TOLP ”), owns 244,175,207 Common Units and warrants to purchase 51,675,000 additional Common Units and, to the knowledge of the Teekay Parties, Brookfield TOLP owns such Common Units and warrants free and clear of all Liens, except restrictions on transferability contained in the Partnership Agreement or under applicable securities laws.

(i) Valid Issuance of the Units . At each Closing Date or Option Closing Date, the Firm Units and the Option Units, as the case may be, and the limited partner interests represented thereby will be duly authorized by the Sixth Amended and Restated Agreement of Limited Partnership of Teekay Offshore Partners L.P. (the “ Restated Partnership Agreement ”) and, when issued and delivered to the Underwriters against payment therefor in accordance with the terms hereof, will be validly issued, without violation of any preemptive right, resale right, right of first refusal or similar right, fully paid (to the extent required under the Restated Partnership Agreement) and nonassessable (except as described in the Prospectus under the heading “The Partnership Agreement—Limited Liability” and except as such nonassessability may be affected by Sections 30, 41, 51 and 60 of the of the Marshall Islands Limited Partnership Act and except as may otherwise be provided in the Restated Partnership Agreement). The form of certificate representing the Units (i) complies with the requirements of the Restated Partnership Agreement, (ii) does not violate the laws of the Republic of the Marshall Islands and (iii) complies with the requirements and rules of the New York Stock Exchange (“ NYSE ”).

(j) Ownership of the General Partner . Teekay Holdings Limited, a Bermuda company (“ Teekay Holdings ”) and Brookfield TK TOGP L.P., a Bermuda limited partnership (“ Brookfield ”), directly own a 51% membership interest and a 49% membership interest, respectively, in the General Partner; such membership interests have been duly authorized and validly issued in accordance with the limited liability company agreement of the General Partner, as amended or restated on or prior to the date hereof (the “ General Partner LLC Agreement ”),

without violation of any preemptive right, resale right, right of first refusal or similar right, and are fully paid (to the extent required under the General Partner LLC Agreement) and nonassessable (except as such nonassessability may be affected by Sections 20, 31, 40 and 49 of the Marshall Islands Limited Liability Company Act of 1996 and the General Partner LLC Agreement); and Teekay Holdings and, to the knowledge of the Teekay Parties, Brookfield owns such membership interests free and clear of all Liens.

(k) Ownership of Teekay Offshore Holdings . The Partnership owns a 100% membership interest in Teekay Offshore Holdings; such membership interest has been duly authorized and validly issued in accordance with the limited liability company agreement of Teekay Offshore Holdings, as amended on or prior to the date hereof (the “ Teekay Offshore Holdings LLC Agreement ”), without violation of any preemptive right, resale right, right of first refusal or similar right, and is fully paid (to the extent required under the Teekay Offshore Holdings LLC Agreement) and nonassessable (except as such nonassessability may be affected by Sections 20, 31, 40 and 49 of the Marshall Islands Limited Liability Company Act of 1996 and except as may be provided in the Teekay Offshore Holdings LLC Agreement); and the Partnership owns such membership interest free and clear of all Liens except for Liens pursuant to the credit agreements and related security agreements disclosed or referred to in the Disclosure Package and the Prospectus.

(l) Ownership of ShuttleCo . Teekay Offshore Holdings owns a 100% membership interest in ShuttleCo; such membership interest has been duly authorized and validly issued in accordance with the limited liability company agreement of ShuttleCo, as amended on or prior to the date hereof (the “ ShuttleCo LLC Agreement ”), without violation of any preemptive right, resale right, right of first refusal or similar right, and is fully paid (to the extent required under the ShuttleCo LLC Agreement) and nonassessable (except as such nonassessability may be affected by Sections 20, 31, 40 and 49 of the Marshall Islands Limited Liability Company Act of 1996 and except as may be provided in the ShuttleCo LLC Agreement); and Teekay Offshore Holdings owns such membership interest free and clear of all Liens except for Liens pursuant to the credit agreements and related security agreements disclosed or referred to in the Disclosure Package and the Prospectus.

(m) Ownership of OLP GP . ShuttleCo owns a 100% membership interest in OLP GP; such membership interest has been duly authorized and validly issued in accordance with the limited liability company agreement of OLP GP, as amended on or prior to the date hereof (the “ OLP GP LLC Agreement ”), and is fully paid (to the extent required under the OLP GP LLC Agreement) and nonassessable (except as such nonassessability may be affected by Sections 20, 31, 40 and 49 of the Marshall Islands Limited Liability Company Act of 1996 and the OLP GP LLC Agreement); and ShuttleCo owns such membership interest free and clear of all Liens except for Liens pursuant to credit agreements and related security agreements disclosed or referred to in the Disclosure Package and the Prospectus.

(n) Ownership of the Operating Company . (1) ShuttleCo directly owns a 99.09% limited partner interest in the Operating Company and (2) OLP GP directly owns a 0.91% general partner interest in the Operating Company; such partner interests have been duly authorized and validly issued in accordance with the partnership agreement of the Operating Company, as amended on or prior to the date hereof (the “ Operating Company Partnership

Agreement ”), and are fully paid (to the extent required under the Operating Company Partnership Agreement) and, with respect to the limited partner interests, are nonassessable (except as such nonassessability may be affected by Sections 30, 41, 51 and 60 of the Marshall Islands Limited Partnership Act); and ShuttleCo and OLP GP own such partner interests free and clear of all Liens except for Liens pursuant to credit agreements and related security agreements disclosed or referred to in the Disclosure Package and the Prospectus.

(o) Ownership of the Operating Subsidiaries . The Partnership, Teekay Offshore Holdings, ShuttleCo and the Operating Company own, directly or indirectly, the equity interests in each of the Operating Subsidiaries as described on Schedule II ; such equity interests have been duly authorized and validly issued in accordance with the organizational documents of each Operating Subsidiary, as amended or restated on or prior to the date hereof (the “ Operating Subsidiaries’ Organizational Documents ”), without violation of any preemptive right, resale right, right of first refusal or similar right, and are fully paid (to the extent required under the Operating Subsidiaries’ Organizational Agreements) and nonassessable (except as such nonassessability may be affected by the applicable statutes of the jurisdiction of formation of the applicable Operating Subsidiary and except as may be provided in the Operating Subsidiaries’ Organizational Documents); and the Partnership, Teekay Offshore Holdings, ShuttleCo and the Operating Company, as applicable, own such equity interests free and clear of all Liens except for Liens pursuant to the credit agreements, lease agreements and related security agreements disclosed or referred to in the Disclosure Package and the Prospectus.

(p) No Other Subsidiaries . Other than its 0.76% general partner interest in the Partnership and the Incentive Distribution Rights, the General Partner does not own, directly or indirectly, any equity or long-term debt securities of any corporation, partnership, limited liability company, joint venture, association or other entity. Other than (i) the Partnership’s ownership of a 100% membership interest in Teekay Offshore Holdings, (ii) Teekay Offshore Holdings’ ownership of a 100% membership interest in ShuttleCo, (iii) ShuttleCo’s ownership of the partnership interests (directly and indirectly, through OLP GP) in the Operating Company as specified in paragraph (n) above and (iv) the Operating Company’s, Teekay Offshore Holdings’, ShuttleCo’s or the Partnership’s ownership, as applicable (directly or indirectly), of the percentage of the equity interests in each of the Operating Subsidiaries as set forth on Schedule II, none of the Partnership, Teekay Offshore Holdings, ShuttleCo or the Operating Company owns, and at each Closing Date or Option Closing Date, will own, directly or indirectly, any equity or long-term debt securities of any corporation, partnership, limited liability company, joint venture, association or other entity, except as described in the Disclosure Package and the Prospectus.

(q) No Preemptive Rights or Options . Except as set forth in the Restated Partnership Agreement and as described in the Disclosure Package and the Prospectus, and except as set forth in the Operating Subsidiaries’ Organizational Documents of each Operating Subsidiary that is not wholly owned, directly or indirectly by the Operating Company (or any shareholder agreements between the shareholders of such Operating Subsidiaries), and except as contained in Section 78 of the Marshall Islands Business Corporations Act, there are no preemptive rights or other rights to subscribe for or to purchase, nor any restriction upon the voting or transfer of, any equity interests of any of the Teekay Entities. Except as described in the Disclosure Package and the Prospectus, there are no outstanding options or warrants to

purchase (i) any Series A Preferred Units (as defined below), (ii) any Series B Preferred Units (as defined below), (iii) Series E Preferred Units, (iv) the Partnership’s ownership of 100% of the shares of Teekay Offshore Finance Corp., a Marshall Islands corporation, (v) any Common Units, Incentive Distribution Rights or other interests in the Partnership, (vi) to the Teekay Parties’ knowledge, any membership interests in OLP GP, the General Partner, Teekay Offshore Holdings or ShuttleCo, (vii) to the Teekay Parties’ knowledge, any partnership interests in the Operating Company, or (viii) to the Teekay Parties’ knowledge, any equity interests in any Operating Subsidiary.

(r) No Registration Rights . No holder of securities of any of the Teekay Entities has rights to the registration of such securities under the Registration Statement, except for any rights of (i) the General Partner or an Affiliate (as defined in the Partnership Agreement) of the General Partner pursuant to the Partnership Agreement, (ii) certain institutional investors pursuant to that certain Registration Rights Agreement by and among the Partnership and the Purchasers named on Schedule A thereto, dated as of July 1, 2015, (iii) certain institutional investors pursuant to that certain Registration Rights Agreement by and among the Partnership and the Purchasers named on Schedule A thereto, dated as of June 29, 2016 with respect to Common Units, (iv) certain institutional investors pursuant to that certain Registration Rights Agreement by and among the Partnership and the Purchasers named on Schedule A thereto, dated as of June 29, 2016 with respect to certain preferred units and warrants of the Partnership, and (v) Brookfield TK TOLP L.P. and Teekay pursuant to that certain Registration Rights Agreement by and between the Partnership, Brookfield TK TOLP L.P. and Teekay, dated as of September 25, 2017, with respect to Common Units (collectively, the “ Registration Rights ”), which Registration Rights have been waived or do not apply with respect to this Offering.

(s) Capitalization. As of September 30, 2017, the Partnership had on a historical basis, and would have had on an as adjusted basis, as indicated in the Prospectus (and any amendment or supplement thereto), a capitalization as set forth therein. As of the date hereof, the issued and outstanding limited partner interests of the Partnership consist of 410,045,210 Common Units, 6,000,000 Series A Cumulative Redeemable Preferred Units (“ Series A Preferred Units ”), 5,000,000 Series B Cumulative Redeemable Preferred Units (“ Series B Preferred Units ”) and the Incentive Distribution Rights. All of such Common Units, Series A Preferred Units, Series B Preferred Units and Incentive Distribution Rights and the limited partner interests represented thereby have been duly authorized and validly issued in accordance with the Partnership Agreement, and are fully paid (to the extent required under the Partnership Agreement) and nonassessable (except as described in the Preliminary Prospectus under the heading “The Partnership Agreement—Limited Liability” and except as such nonassessability may be affected by Sections 30, 41, 51 and 60 of the Marshall Islands Limited Partnership Act).

(t) Authority . Each of the Teekay Entities, Teekay Holdings and Brookfield has all requisite limited partnership, limited liability company or corporate, as applicable, power and authority to execute and deliver this Agreement and the Restated Partnership Agreement (together, the “ Transaction Documents ”) to which it is party and to perform its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby, including to issue, sell and deliver the Units in accordance with and upon the terms and conditions set forth in this Agreement, the Partnership Agreement, the Registration Statement,

the Disclosure Package and the Prospectus. At each Closing Date or Option Closing Date, all corporate, partnership and limited liability company action, as the case may be, required to be taken by the Teekay Entities, Teekay Holdings and Brookfield or any of their shareholders, partners or members for the authorization, issuance, sale and delivery of the Units, the execution and delivery by the Teekay Parties, Teekay Holdings and Brookfield of the Transaction Documents to which they are party and the consummation of the transactions contemplated hereby and thereby shall have been validly taken.

(u) Execution and Delivery of this Agreement . This Agreement has been duly authorized, validly executed and delivered by each of the Teekay Parties.

(v) Enforceability of Other Agreements .

(i) the General Partner LLC Agreement has been duly authorized, executed and delivered by Teekay Holdings and Brookfield and is a valid and legally binding agreement of Teekay Holdings and Brookfield, enforceable against Teekay Holdings and Brookfield in accordance with its terms;

(ii) the Partnership Agreement has been duly authorized, executed and delivered by the General Partner and Teekay and is a valid and legally binding agreement of the General Partner and Teekay, enforceable against the General Partner and Teekay in accordance with its terms;

(iii) the Restated Partnership Agreement has been duly authorized, and when duly executed and delivered by the General Partner, Teekay Holdings and Brookfield on the Closing Date will be a legally binding agreement of the General Partner, Teekay Holdings and Brookfield, enforceable against the General Partner, Teekay Holdings and Brookfield in accordance with its terms;

(iv) the Teekay Offshore Holdings LLC Agreement has been duly authorized, executed and delivered and is a valid and legally binding agreement of the Partnership, enforceable against the Partnership in accordance with its terms;

(v) the ShuttleCo LLC Agreement has been duly authorized, executed and delivered and is a valid and legally binding agreement of Teekay Offshore Holdings, enforceable against Teekay Offshore Holdings in accordance with its terms;

(vi) the OLP GP LLC Agreement has been duly authorized, executed and delivered by ShuttleCo and is a valid and legally binding agreement of ShuttleCo, enforceable against ShuttleCo in accordance with its terms;

(vii) the Operating Company Partnership Agreement has been duly authorized, executed and delivered by OLP GP and ShuttleCo and is a valid and legally binding agreement of OLP GP and ShuttleCo enforceable against OLP GP and ShuttleCo in accordance with its terms; and

(viii) each of the Operating Subsidiaries’ Organizational Documents has been duly authorized, executed and delivered by the appropriate Teekay Entity and is a valid and legally binding agreement of such Teekay Entity, enforceable against such Teekay Entity in accordance with its terms.

provided that, with respect to each agreement described in this Section 1(v), the enforceability thereof may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws relating to or affecting creditors’ rights generally and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law); and, provided further, that the indemnity, contribution and exoneration provisions contained in any of such agreements may be limited by applicable laws and public policy. The General Partner LLC Agreement, the Partnership Agreement, the Restated Partnership Agreement, the Teekay Offshore Holdings LLC Agreement, the ShuttleCo LLC Agreement, the OLP GP LLC Agreement, the Operating Company Partnership Agreement and the Operating Subsidiaries’ Organizational Documents are herein collectively referred to as the “ Organizational Documents .”

(w) No Conflicts . None of (i) the offering, issuance and sale by the Partnership of the Units to be issued and sold by the Partnership to the Underwriters pursuant to the terms of this Agreement, (ii) the execution, delivery and performance of the Transaction Documents by Teekay Holdings, the Teekay Entities party hereto or thereto, or, to the knowledge of the Teekay Parties, Brookfield, or (iii) the consummation of the transactions contemplated hereby or thereby, or the application of the proceeds from the sale of the Units as described under the heading “Use of Proceeds” in the Registration Statement, the Disclosure Package and the Prospectus, (A) conflicts or will conflict with or constitutes or will constitute a violation of any Organizational Document, (B) conflicts or will conflict with or constitutes or will constitute a breach or violation of, or a default (or an event that, with notice or lapse of time or both, would constitute such a default) under, any indenture, contract, mortgage, deed of trust, note agreement, loan agreement, lease or other agreement, or instrument to which any of Teekay Holdings, Brookfield or the Teekay Entities is a party or by which any of them or any of their respective properties may be bound, (C) violates or will violate any statute, law, rule, regulation, judgment, order or decree applicable to any of Teekay Holdings, Brookfield or the Teekay Entities of any court, regulatory body, administrative agency, governmental body, arbitrator or other authority having jurisdiction over Teekay Holdings, Brookfield or any of the Teekay Entities or any of their properties, or (D) results or will result in the creation or imposition of any Lien upon any property or assets of Teekay Holdings, Brookfield or any of the Teekay Entities (other than Liens referred to or described in the Registration Statement, the Disclosure Package and the Prospectus), which conflicts, breaches, violations, defaults or Liens, in the case of clauses (B), (C) or (D), could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or could materially impair the ability of any of Teekay Holdings, Brookfield or the Teekay Entities to perform their obligations under the Transaction Documents.

(x) No Consents . Except for (i) the registration of the Units under the Act, (ii) such consents, approvals, authorizations, registrations or qualifications as may be required under the Exchange Act, and applicable state securities or “Blue Sky” laws in connection with the purchase and distribution of Units by the Underwriters, (iii) such consents, approvals or authorizations as may be required under the rules of the NYSE or the rules of the Financial Industry Regulatory Authority (“ FINRA ”) and (iv) such consents that, if not obtained, would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or

would not reasonably be expected to materially impair the ability of any of the Teekay Entities to perform their obligations under this Agreement, no permit, consent, approval, authorization, order, registration, filing or qualification (“ consent ”) of or with any court, governmental agency or body having jurisdiction over any of the Teekay Entities or any of their respective properties is required in connection with the offering, issuance and sale by the Partnership of the Units, the execution, delivery and performance of the Transaction Documents by the parties hereto and thereto (other than the Underwriters), or the consummation of the transactions contemplated by the Transaction Documents.

(y) No Default . None of the Teekay Entities is (i) in violation of its Organizational Documents, (ii) in breach of or in default under (and no event that, with notice or lapse of time or both, would constitute such a default has occurred or is continuing under) any term, covenant, obligation, agreement or condition contained in any indenture, mortgage, deed of trust, note agreement, loan agreement, lease or other agreement, obligation, condition, covenant or instrument to which it is a party or by which it is or may be bound or to which any of its properties or assets is subject or (iii) in violation of any statute, law, rule, regulation, judgment, order or decree applicable to any of the Teekay Entities of any court, regulatory body, administrative agency, governmental body, arbitrator or other authority having jurisdiction over any of the Teekay Entities or any of their properties, which breach, default or violation, in the case of clause (ii) or (iii), would, if continued, reasonably be expected to have a Material Adverse Effect, or could reasonably be expected to materially impair the ability of any of the Teekay Entities to perform their obligations under the Transaction Documents. To the knowledge of the Teekay Parties, no third party to any indenture, contract, mortgage, deed of trust, note agreement, loan agreement, lease or other agreement, obligation, condition, covenant or instrument to which any of the Teekay Entities is a party or by which any of them are bound or to which any of their properties are subject, is in default under any such agreement, which breach, default or violation would, if continued, reasonably be expected to have a Material Adverse Effect.

(z) Conformity of Units to Description . The Units, when issued and delivered in accordance with the terms of the Restated Partnership Agreement against payment therefor as provided herein will conform, in all material respects to the descriptions thereof contained in the Disclosure Package and the Prospectus and such descriptions conform and will conform to the rights set forth in the Restated Partnership Agreement.

(aa) No Material Adverse Change . Since the date of the latest financial statements included in the Disclosure Package (exclusive of any amendment or supplement thereto after the date hereof) and the Prospectus (exclusive of any amendment or supplement thereto after the date hereof), (i) no Teekay Entity has sustained any material loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, investigation, order or decree, (ii) there has not been any material change in the capitalization or material increase in the short-term debt or long-term debt of the Teekay Entities or any material adverse change, or any development involving or which could reasonably be expected to involve, individually or in the aggregate, a prospective material adverse change in or affecting the general affairs, condition (financial or otherwise), stockholders’ equity, partners’ equity, members’ equity, results of operations, business, properties, assets or prospects of the Teekay Entities, taken as a whole, and

(iii) none of the Teekay Entities has incurred any liability or obligation, direct, indirect or contingent, or entered into any transactions, whether or not in the ordinary course of business, that, individually or in the aggregate, is material to the Teekay Entities, taken as a whole, or otherwise than as set forth or contemplated in the Disclosure Package.

(bb) Financial Statements . The consolidated historical financial statements (including the related notes and supporting schedules) included or incorporated by reference in the Registration Statement, the Disclosure Package (and any amendment or supplement thereto) and the Prospectus (and any amendment or supplement thereto) (i) present fairly in all material respects the financial condition, results of operations and cash flows of the entities purported to be shown thereby on the basis stated therein, at the respective dates or for the respective periods indicated, (ii) comply as to form in all material respects with the applicable accounting requirements of the Act and (iii) have been prepared in conformity with generally accepted accounting principles applied on a consistent basis throughout the periods involved (except as otherwise noted therein). The selected financial data included or incorporated by reference into the Registration Statement, the Disclosure Package (and any amendment or supplement thereto) and the Prospectus (and any amendment or supplement thereto) is accurately presented in all material respects and prepared on a basis consistent with the audited historical consolidated financial statements from which it has been derived. Any pro forma financial statements and the related notes thereto incorporated by reference into the Registration Statement, the Disclosure Package (and any amendment or supplement thereto) and the Prospectus (i) present fairly the information shown therein, (ii) have been prepared in accordance with the Commission’s rules and guidelines with respect to pro forma financial statements and (iii) have been properly compiled on the basis described therein, and the assumptions used in the preparation thereof are reasonable and the adjustments used therein are appropriate to give effect to the transactions and circumstances referred to therein.

(cc) Independent Registered Public Accounting Firm . KPMG LLP, who has certified or shall certify the financial statements of the Partnership and OOG TKP FPSO GmbH & Co KG and delivered its reports with respect to the audited consolidated financial statements included in the Registration Statement, the Disclosure Package and the Prospectus, were and are the independent registered public accounting firm with respect to such entities within the meaning of the Act and the applicable published rules and regulations thereunder and the rules and regulations of the Public Company Accounting Oversight Board.

(dd) Transfer Taxes . There are no transfer taxes or other similar fees or charges under United States Federal law or the laws of any state or any political subdivision thereof required to be paid in connection with the execution and delivery of this Agreement, the issuance by the Partnership or sale by the Partnership of the Units or the consummation of the transactions contemplated by this Agreement.

(ee) Title to Properties . The Teekay Entities have good and marketable title to all real property and good title to all personal property described in the Registration Statement, the Disclosure Package and the Prospectus as owned by the Teekay Entities, and each Teekay Entity identified in Schedule III is the sole owner, lessee or charterer, as indicated, of the vessel set forth opposite its name in Schedule III (the “ Vessels ”), in each case free and clear of all Liens except (i) as described, and subject to the limitations contained, in the Registration Statement,

the Disclosure Package and the Prospectus or (ii) as do not materially affect the value of such property, taken as a whole, and do not materially interfere with the use of such properties, taken as a whole, as they have been used in the past and are proposed to be used in the future, as described in the Registration Statement, the Disclosure Package and the Prospectus (the Liens described in clauses (i) and (ii) above being “ Permitted Liens ”); provided that with respect to any interest in real property, vessels and buildings held under lease by the Teekay Entities, such real property, vessels and buildings are held under valid and subsisting and enforceable leases (except as may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws relating to or affecting creditors’ rights generally and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law)), with such exceptions as do not materially interfere with the use of the properties of the Teekay Entities, taken as a whole as they have been used in the past as described in the Registration Statement, the Disclosure Package and the Prospectus and are proposed to be used in the future as described in the Registration Statement, the Disclosure Package and the Prospectus.

(ff) Vessel Registration . Each vessel identified in Schedule III is duly registered under the laws of the jurisdiction set forth in Schedule III in the name of the applicable Teekay Entity identified in Schedule III , free and clear of all Liens except for Permitted Liens.

(gg) Permits . Each of the Teekay Entities has such permits, consents (as defined above), licenses, franchises, concessions, certificates and authorizations (“ permits ”) of, and has made all declarations and filings with, all Federal, provincial, state, local or foreign governmental or regulatory authorities, all self-regulatory organizations and all courts and other tribunals, as are necessary to own or lease its properties and to conduct its business in the manner described in the Registration Statement, the Disclosure Package and the Prospectus, subject to such qualifications as may be set forth in the Registration Statement, the Disclosure Package and the Prospectus and except for such permits, declarations and filings that, if not obtained, would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; except as set forth in the Registration Statement, the Disclosure Package and the Prospectus, each of the Teekay Entities has fulfilled and performed all its material obligations with respect to such permits which are or will be due to have been fulfilled and performed by such date and no event has occurred that would prevent the permits from being renewed or reissued or that allows, or after notice or lapse of time would allow, revocation or termination thereof or results or would result in any impairment of the rights of the holder of any such permit, except for such non-renewals, non-issues, revocations, terminations and impairments that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, and none of such permits contains any restriction that is materially burdensome to the Teekay Entities, taken as a whole.

(hh) Insurance . Except as set forth in the Registration Statement, the Disclosure Package and the Prospectus with respect to off hire insurance, the Teekay Entities are insured by insurers of recognized financial responsibility covering against such losses and risks and in such amounts as are prudent and customary in the businesses in which they are engaged; all policies of insurance insuring the Teekay Entities or their respective businesses, assets, employees, officers and directors are in full force and effect; the Teekay Entities are in compliance with the terms of such policies and instruments in all material respects; and there are

no claims by any of the Teekay Entities under any such policy or instrument as to which any insurance company is denying liability or defending under a reservation of rights clause except that would not reasonably be expected to have a Material Adverse Effect; none of the Teekay Entities has been refused any insurance coverage sought or applied for; and the General Partner believes that each of the Teekay Entities will be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not reasonably be expected to have a Material Adverse Effect.

(ii) Contracts to be Described or Filed . To the knowledge of the Teekay Parties, there is no agreement, franchise, contract, indenture, lease or other document or instrument of a character required to be described in the Registration Statement or the Prospectus, or to be filed as an exhibit thereto, which is not described or filed as required and the statements in the Registration Statement, the Disclosure Package or the Prospectus under the heading “Material U.S. Federal Income Tax Considerations” and “Non-United States Tax Considerations,” insofar as such statements summarize legal matters, agreements, documents or proceedings discussed therein, are accurate and fair summaries of such legal matters, agreements, documents or proceedings.

(jj) Litigation . There is (i) no action, suit or proceeding before or by any court, arbitrator or governmental agency, body or official, domestic or foreign, now pending or, to the knowledge of the Teekay Parties, threatened, to which any of the Teekay Entities is or could reasonably be expected to be made a party or to which the business or property of any of the Teekay Entities is or could reasonably be expected to be made subject or that would be required to be disclosed in the Registration Statement, the Disclosure Package or the Prospectus which is not adequately disclosed in the Registration Statement, the Disclosure Package or the Prospectus as required, (ii) no statute, rule, regulation or order that has been enacted, adopted or issued by any governmental agency or, to the knowledge of the Teekay Parties, that has been proposed by any governmental agency, and (iii) no injunction, restraining order or order of any nature issued by a Federal or state court or foreign court of competent jurisdiction to which any of the Teekay Entities is or may be subject, that, in the case of clauses (i), (ii) and (iii) above, (A) could reasonably be expected to (1) individually or in the aggregate have a Material Adverse Effect, or (2) prevent or result in the suspension of the offering and issuance of the Units, or (B) questions the validity of this Agreement.

(kk) Certain Relationships and Related Transactions . No relationship, direct or indirect, exists between or among any Teekay Entity, on the one hand, and the directors, officers, members, partners, shareholders, customers or suppliers of any Teekay Entity on the other hand that is required to be described in the Registration Statement, the Disclosure Package or the Prospectus that is not so described. There are no outstanding loans, advances (except normal advances for business expenses in the ordinary course of business) or guarantees of indebtedness by any Teekay Entity to or for the benefit of any of the officers, directors or managers of any Teekay Entity or their respective family members, except as disclosed in the Registration Statement, the Disclosure Package and the Prospectus. No Teekay Entity has, in violation of the Sarbanes-Oxley Act of 2002, directly or indirectly, extended or maintained credit, arranged for the extension of credit, or renewed an extension of credit, in the form of a personal loan to or for any director or executive officer of any Teekay Entity.

(ll) Sarbanes-Oxley Act of 2002 . The Teekay Parties are in compliance in all material respects with all applicable provisions of the Sarbanes-Oxley Act of 2002 and the rules and regulations of the Commission and the NYSE that are effective and applicable to the Partnership.

(mm) No Labor Dispute . No labor problem or dispute with the employees of the Teekay Entities exists or is threatened or imminent, and none of the Teekay Parties is aware of any existing or imminent labor disturbance by the employees of any of the principal suppliers, contractors or customers of any of the Teekay Entities, that, in each case, could reasonably be expected to have a Material Adverse Effect.

(nn) Tax Returns . Each of the Teekay Entities has filed all tax returns that are required to be filed or has requested extensions thereof (except in any case in which the failure so to file would not reasonably be expected to have a Material Adverse Effect) and has paid all taxes required to be paid by it and any other assessment, fine or penalty levied against it, to the extent that any of the foregoing is due and payable, except for any such assessment, fine or penalty that is currently being contested in good faith or as would not reasonably be expected to have a Material Adverse Effect.

(oo) Internal Controls . Each Teekay Entity maintains systems of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with U.S. generally accepted accounting principles and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences. The Teekay Entities’ “internal controls over financial reporting” (as such term is defined in rule 13a-15(f) and Rule 15d-15(f) under the Exchange Act) are effective and none of the Teekay Entities is aware of any material weakness in its internal controls over financial reporting.

(pp) Disclosure Controls and Procedures . The Teekay Entities maintain “disclosure controls and procedures” (as such term is defined in Rule 13a-15(e) and Rule 15d-15(e) under the Exchange Act); such disclosure controls and procedures are effective.

(qq) Environmental Compliance. Each Teekay Entity (i) is in compliance with any and all applicable foreign, federal, state and local laws and regulations relating to the protection of human health and safety, the environment or Hazardous Materials (as defined below) (“ Environmental Laws ”), (ii) has received and is in compliance with all permits, licenses or other approvals required of it under applicable Environmental Laws to conduct its business, (iii) has not received notice of any actual or potential liability under any environmental law, and (iv) is not a party to or affected by any pending or, to the knowledge of the Teekay Parties, threatened action, suit or proceeding, is not bound by any judgment, decree or order, and has not entered into any agreement, in each case relating to any alleged violation of any Environmental Law or any actual or alleged release or threatened release or cleanup at any location of any Hazardous Materials, except where such noncompliance or deviation from that described in (i) - (iv) above would not, individually or in the aggregate, reasonably be expected to have a Material

Adverse Effect. None of the Teekay Entities has been named as a “potentially responsible party” under the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (“ CERCLA ”). The term “ Hazardous Materials ” means (A) any “hazardous substance” as defined in CERCLA, (B) any “hazardous waste” as defined in the Resource Conservation and Recovery Act, as amended, (C) any petroleum or petroleum product, (D) any polychlorinated biphenyl and (E) any pollutant or contaminant or hazardous, dangerous or toxic chemical, material, waste or substance regulated under or within the meaning of any other Environmental Law.

(rr) Effect of Environmental Laws . In the ordinary course of its business, each Teekay Entity periodically reviews the effect of Environmental Laws on its business, operations and properties, in the course of which it identifies and evaluates associated costs and liabilities (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any permit, license or approval, any related constraints on operating activities and any potential liabilities to third parties). On the basis of such review, each Teekay Entity has reasonably concluded that such associated costs and liabilities would not, individually or in the aggregate, have a Material Adverse Effect.

(ss) Intellectual Property . Each of the Teekay Entities owns or possesses rights to use all patents, patent applications, trademarks, service marks, trade names, trademark registrations, service mark registrations, copyrights, technology, know-how and other intellectual property necessary for the conduct of their respective businesses, except where the failure to possess such rights would not reasonably be expected to have a Material Adverse Effect, and the Teekay Parties believe that the conduct by the Teekay Entities of their respective businesses will not conflict with, and the Teekay Entities have not received any notice of any claim of conflict with, any such rights of others.

(tt) No Distribution of Other Offering Materials . None of the Teekay Entities has distributed and, prior to the later to occur of (i) the Closing Date or final Option Closing Date and (ii) completion of the distribution of the Units, will not distribute, any prospectus (as defined under the Act) in connection with the offering and sale of the Units other than the Registration Statement, the Disclosure Package, the Prospectus, any Issuer Free Writing Prospectus or other materials, if any, permitted by the Act, including Rule 134 under the Act.

(uu) Investment Company . The Partnership is not, and immediately after the sale of the Units to be sold by the Partnership hereunder and application of the net proceeds from such sale as described in the Registration Statement, the Disclosure Package, and the Prospectus under the heading “Use of Proceeds” will not be, required to register as an “investment company” under the Investment Company Act of 1940, as amended, and the rules and regulations thereunder (the “ 1940 Act ”).

(vv) Passive Foreign Investment Company . To the knowledge of the Teekay Parties, after consultation with United States federal income tax counsel, none of the Teekay Entities is a Passive Foreign Investment Company (“ PFIC ”) within the meaning of Section 1297 of the Internal Revenue Code of 1986, as amended (the “ Code ”).

(ww) Tax Status . None of the Teekay Entities, other than the Partnership and the General Partner, has elected to be classified as an association taxable as a corporation for United States federal income tax purposes. Each of the Teekay Entities, other than the Partnership and the General Partner, has properly elected to be classified as a disregarded entity if it has one owner or as a partnership if it has more than one owner for United States federal income tax purposes (other than any Teekay Entity that is classified other than as a corporation without regard to whether it makes an election).

(xx) Foreign Corrupt Practices Act . No Teekay Entity, nor any director, officer, or employee, nor, to the knowledge of the Teekay Parties, any affiliate, agent or representative of the Teekay Entities, has taken or will take any action, directly or indirectly, that would result in a violation by such persons of the Foreign Corrupt Practices Act of 1977, as amended (such act, including the rules and regulations thereunder, the “ FCPA ”), including, without limitation, making use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay, or authorization or approval of the payment or giving of money, property, gifts or anything else of value, directly or indirectly, to any “government official” (including any officer or employee of a government or government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official or candidate for political office) to influence official action or secure an improper advantage; and the Teekay Entities have conducted their businesses in compliance with applicable anti-corruption laws and have instituted and maintain and will continue to maintain policies and procedures designed to promote and achieve compliance with such laws and with the representation and warranty contained herein.

(yy) Sanctions Laws and Regulations . Neither the sale of the Units by the Partnership hereunder nor the use of the proceeds thereof will cause any U.S. person participating in the offering, either as underwriter and/or purchasers of the Units, to violate the Trading With the Enemy Act, as amended, the International Emergency Economic Powers Act, as amended, or any foreign asset control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) (all such laws and regulations collectively referred to as the “Sanctions Laws and Regulations”) or any enabling legislation or executive order relating thereto.

(zz) Sanctions . None of the Teekay Entities or their directors or officers is, and, to the knowledge of the Teekay Parties, no agent, employee or affiliate of any of the Teekay Entities is, currently the subject of, or in possession of written notice from a governmental authority asserting that it may become the subject of, or is owned or controlled by the subject of or is, organized or resident in a country or territory that is the subject of, any sanctions administered or enforced by the Office of Foreign Assets Control of the U.S. Treasury Department, the U.S. Department of State, the United Nations Security Council, the European Union, Her Majesty’s Treasury, or other relevant sanctions authority (collectively, “ Sanctions ”); and the Teekay Entities will not directly or indirectly use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person, individual, vessel or entity (“ Person ”), to fund or facilitate the activities or business of or with any Person, or in any country or territory that, at the time of such funding or facilitation, is the subject of any Sanctions (collectively, “ Sanctioned Persons ” and each, a

“ Sanctioned Person ”). None of the Teekay Entities is engaged in any dealings or transactions with or for the benefit of a Sanctioned Person, or with or in a country or territory that is, or whose government is, the subject of Sanctions that broadly prohibit dealings with that country or territory (collectively, “ Sanctioned Countries ” and each, a “ Sanctioned Country ”), in the preceding three years, nor do any of the Teekay Entities have any plans to deal or transact with or for the benefit of Sanctioned Persons, or with or in Sanctioned Countries.

(aaa) Money Laundering Laws . The operations of the Teekay Entities are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving any of the Teekay Entities with respect to the Money Laundering Laws is pending or, to the knowledge of the Teekay Parties, threatened.

(bbb) Brokers . Except as described in the Registration Statement, the Disclosure Package and the Prospectus, there are no contracts, agreements or understandings between any Teekay Entity and any person that would give rise to a valid claim against any Teekay Entity or any Underwriter for a brokerage commission, finder’s fee or other like payment in connection with this Offering.

(ccc) Market Stabilization . None of the Teekay Entities has taken, directly or indirectly, any action designed to or that would constitute or that might reasonably be expected to cause or result in, under the Exchange Act or otherwise, stabilization or manipulation of the price of any security of the Partnership to facilitate the sale or resale of the Units.

(ddd) Prohibition on Dividends . Except (i) as provided in the credit and loan agreements described in the Registration Statement, the Disclosure Package and the Prospectus and by Section 51 of the Marshall Islands Limited Partnership Act, Section 40 of the Marshall Islands Limited Liability Company Act of 1996 and Sections 43 and 44 of the Marshall Islands Business Corporations Act, (ii) as otherwise mandated by the laws of the Operating Subsidiaries’ jurisdiction of formation or (iii) as provided in the Operating Subsidiaries’ Organizational Documents of non-wholly owned Operating Subsidiaries (or any shareholder agreements between the shareholders of such Operating Subsidiaries), none of Teekay Offshore Holdings, ShuttleCo, the Operating Company or any Operating Subsidiary is prohibited, directly or indirectly, from paying any dividends to the Partnership, Teekay Offshore Holdings, ShuttleCo or the Operating Company, as the case may be, from making any other distribution on such subsidiary’s equity securities, from repaying to Teekay Offshore Holdings, ShuttleCo, the Partnership or the Operating Company any loans or advances to such subsidiary from Teekay Offshore Holdings, ShuttleCo, the Partnership or the Operating Company or from transferring any of such subsidiary’s property or assets to Teekay Offshore Holdings, ShuttleCo, the Partnership, the Operating Company or any other subsidiary of the Partnership.

(eee) Statistical and Market Data . The statistical and market-related data included in the Registration Statement, the Disclosure Package and the Prospectus are based on or derived from sources which the Teekay Parties believe to be reliable and accurate.

(fff) XBRL . The interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Registration Statement, the Disclosure Package and the Prospectus fairly present the information called for in all material respects and have been prepared in accordance with the Commission’s rules and guidelines applicable thereto.

(ggg) FINRA . To the Teekay Parties’ knowledge, there are no affiliations or associations between (i) any member of FINRA and (ii) the Partnership or any of the General Partner’s officers, directors or 5% or greater security holders or any beneficial owner of the Partnership’s unregistered equity securities that were acquired at any time on or after the 180th day immediately preceding the date the Registration Statement was initially filed with the Commission, except as disclosed in the Registration Statement (excluding the exhibits thereto), the Disclosure Package and the Prospectus or as otherwise disclosed in writing to the Representatives.

(hhh) Certificates. Any certificate signed by any officer of any Teekay Entity and delivered to the Underwriters or to counsel for the Underwriters in connection with the closing of the Offering shall be deemed a representation and warranty by such Teekay Entity, as to matters covered thereby, to each Underwriter.

2. Purchase and Sale.

(a) Subject to the terms and conditions and in reliance upon the representations and warranties herein set forth, the Partnership agrees to sell to each Underwriter, and each Underwriter agrees, severally and not jointly, to purchase from the Partnership, at a purchase price of $24.2125 per Unit, the number of the Firm Units set forth opposite such Underwriter’s name in Schedule I hereto.

(b) Subject to the terms and conditions and in reliance upon the representations and warranties herein set forth, the Partnership hereby grants an option to the several Underwriters to purchase, severally and not jointly, up to 690,000 Option Units at the purchase price per Unit as the Underwriters shall pay for the Firm Units, less an amount per unit equal to any distributions declared by the Partnership and payable on the Firm Units but not payable on the Option Units. Said option may be exercised in whole or in part at any time and from time to time on or before the 30th day after the date of the Prospectus upon written notice by the Representatives to the Partnership setting forth the number of Option Units as to which the several Underwriters are exercising the option and the settlement date. The number of Option Units to be purchased by each Underwriter shall be the same percentage of the total number of Option Units to be purchased by the several Underwriters as such Underwriter is purchasing of the Firm Units, subject to such adjustments as the Representatives in their absolute discretion shall make to eliminate any fractional Units.

3. Delivery and Payment. Delivery of and payment for the Firm Units and the Option Units (if the option provided for in Section 2(b) hereof shall have been exercised on or

before the third Business Day immediately preceding the Closing Date) shall be made at 10:00 AM, Eastern time, on January 23, 2018, at the offices of Perkins Coie LLP, Portland, Oregon, or at such time on such later date not more than three Business Days after the foregoing date as the Representatives shall designate, which date and time may be postponed by agreement between the Representatives and the Partnership or as provided in Section 9 hereof (such date of delivery and payment for the Units being herein called the “ Closing Date ”). Delivery of the Units shall be made to the Representatives for the respective accounts of the several Underwriters against payment by the several Underwriters through the Representatives of the purchase price thereof to or upon the order of the Partnership by wire transfer payable in same-day funds to an account specified by the Partnership. Delivery of the Units shall be made through the facilities of The Depository Trust Company (“ DTC ”) unless the Representatives shall otherwise instruct.

If the option provided for in Section 2(b) is exercised after the third Business Day immediately preceding the Closing Date, the Partnership will deliver the Option Units (at the expense of the Partnership) to the Representatives, on the date specified by the Representatives (which shall be within three Business Days after exercise of said option) for the respective accounts of the several Underwriters, against payment by the several Underwriters through the Representatives of the purchase price thereof to or upon the order of the Partnership by wire transfer payable in same-day funds to an account specified by the Partnership. Delivery of the Option Units shall be made through the facilities of DTC unless the Representatives shall otherwise instruct. If settlement of the Option Units occurs after the Closing Date, the Partnership will deliver to the Representatives for the respective accounts of the several Underwriters on the Option Closing Date, and the obligation of the Underwriters to purchase the Option Units shall be conditioned upon receipt of, supplemental opinions (other than the opinions specified in Sections 6(f) and 6(g)), certificates and letters confirming as of such date the opinions, certificates and letters delivered on the Closing Date pursuant to Section 6 hereof. To the extent any of the opinions specified in Sections 6(f) and 6(g) are not delivered on an Option Closing Date, as contemplated by the preceding sentence, the certificate specified in Section 6(i) delivered on such Option Closing Date shall include an additional statement to the effect that, to the officers’ knowledge, after due inquiry, there has been no change in fact or law that would lead the officers to believe that such legal opinions could not be delivered on such Option Closing Date.

For purposes of this Agreement, the term “Business Day” shall mean any day other than a Saturday, a Sunday or a legal holiday or a day on which banking institutions, trust companies and the NYSE are authorized or obligated by law to close in New York City.

4. Offering by Underwriters. It is understood that the several Underwriters propose to offer the Units for sale to the public as set forth in the Registration Statement, the Disclosure Package and the Prospectus.

5. Agreements. Each of the Teekay Parties, jointly and severally, agrees with the several Underwriters that:

(a) Preparation of the Prospectus and Registration Statement. Prior to the termination of the Offering, the Partnership will not file any amendment to the Registration

Statement or supplement to any Preliminary Prospectus or the Prospectus or any Rule 462(b) Registration Statement unless the Partnership has furnished to you a copy for your review prior to filing and will not file any such proposed amendment or supplement to which you reasonably object. The Partnership will cause the Prospectus, properly completed, and any supplement thereto to be filed in a form approved by the Representatives, which approval will not be unreasonably withheld or delayed, with the Commission pursuant to the applicable paragraph of Rule 424(b) within the time period prescribed and will provide evidence satisfactory to the Representatives of such timely filing. The Partnership will promptly advise the Representatives (i) when the Prospectus, and any supplement thereto, shall have been filed (if required) with the Commission pursuant to Rule 424(b) or when any Rule 462(b) Registration Statement shall have been filed with the Commission, (ii) when, prior to termination of the Offering, any amendment to the Registration Statement shall have been filed or become effective, (iii) of any request by the Commission or its staff for any amendment of the Registration Statement, or any Rule 462(b) Registration Statement, or for any supplement to the Prospectus or for any additional information, (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of any notice objecting to its use or the institution or threatening of any proceeding for that purpose and (v) of the receipt by the Partnership of any notification with respect to the suspension of the qualification of the Units for sale in any jurisdiction or the institution or threatening of any proceeding for such purpose. The Partnership will use its commercially reasonable efforts to prevent the issuance of any such stop order or the occurrence of any such suspension or objection to the use of the Registration Statement and, upon such issuance, occurrence or notice of objection, to obtain as soon as possible the withdrawal of such stop order or relief from such occurrence or objection, including, if necessary, by filing an amendment to the Registration Statement or a new registration statement and using its commercially reasonable efforts to have such amendment or new registration statement declared effective as soon as practicable.

(b) Notification Regarding Disclosure Package. If, at any time prior to the filing of the Prospectus pursuant to Rule 424(b), any event occurs as a result of which the Disclosure Package would include any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein in the light of the circumstances under which they were made at such time not misleading, the Partnership will (i) notify promptly the Representatives so that any use of the Disclosure Package may cease until it is amended or supplemented; (ii) amend or supplement the Disclosure Package to correct such statement or omission; and (iii) supply any amendment or supplement to you in such quantities as you may reasonably request.

(c) Filing of Amendment or Supplement. If, at any time when a prospectus relating to the Units is required to be delivered under the Act (including in circumstances where such requirement may be satisfied pursuant to Rule 172), any event occurs as a result of which the Prospectus as then supplemented would include any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein in the light of the circumstances under which they were made or the circumstances then prevailing not misleading, or if it shall be necessary to amend the Registration Statement or supplement the Prospectus to comply with the Act or the rules thereunder, the Partnership promptly will (i) notify the Representatives of any such event; (ii) prepare and file with the Commission, subject to the first sentence of paragraph (a) of this Section 5, an amendment or supplement which will correct such

statement or omission or effect such compliance; and (iii) supply any supplemented prospectus to you in such quantities as you may reasonably request.

(d) Reports to Unitholders. As soon as practicable, but in any event not later than 60 days after the close of the period covered thereby, the Partnership will make generally available to its unitholders and to the Representatives an earnings statement or statements of the Partnership and its subsidiaries which will satisfy the provisions of Section 11(a) of the Act and Rule 158.

(e) Copies of Reports. The Partnership will furnish or make available via the Commission’s Electronic Data Gathering Analysis and Retrieval System (“ EDGAR ”) to its unitholders annual reports containing financial statements audited by independent public accountants and quarterly reports containing financial statements and financial information which may be unaudited. The Partnership will, for a period of two years from the Closing Date, furnish or make available via EDGAR, to the Underwriters a copy of each annual report, quarterly report, current report and all other documents, reports and information furnished by the Partnership to its unitholders (excluding any periodic income tax reporting materials) or filed with any securities exchange or market pursuant to the requirements of such exchange or market or with the Commission pursuant to the Act or the Exchange Act (other than any annual chief executive officer certification and annual written affirmations to the NYSE).

(f) Signed Copies of the Registration Statement. The Partnership will furnish to the Representatives and counsel for the Underwriters photocopies of signed copies of the Registration Statement (including exhibits thereto) and to each other Underwriter a copy of the Registration Statement (without exhibits thereto) and, so long as delivery of a prospectus by an Underwriter or dealer may be required by the Act (including in circumstances where such requirement may be satisfied pursuant to Rule 172), as many copies of each Preliminary Prospectus, the Prospectus and each Issuer Free Writing Prospectus and any supplement thereto as the Representatives may reasonably request.

(g) Qualification of Units. The Partnership will arrange, if necessary, for the qualification of the Units for sale under the laws of such jurisdictions as the Representatives may reasonably designate and will maintain such qualifications in effect so long as reasonably required for the distribution of the Units; provided that in no event shall the Partnership be obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take any action that would subject it to service of process in suits, other than those arising out of the offering or sale of the Units, in any jurisdiction where it is not now so subject. The Partnership will, from time to time, prepare and file such statements and reports as are or may be reasonably required of it to continue such qualifications in effect for so long a period as the Representatives may reasonably request for the distribution of the Units.

(h) Restriction on Sale of Securities . During a period of 30 days from the date of this Agreement, the Teekay Entities will not, without the prior written consent of the Representatives, (i) directly or indirectly, 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 for the sale of, or lend or otherwise transfer or dispose of, the Units, the Series A Preferred Units, the Series B Preferred Units or any non-convertible securities that are substantially similar to the

Units, whether owned as of the date hereof or hereafter acquired or with respect to which such person has or hereafter acquires the power of disposition, or file, or cause to be filed, any registration statement under the Act with respect to any of the foregoing or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of the Units, the Series A Preferred Units, the Series B Preferred Units or such other non-convertible securities that are substantially similar to the Units, whether any such swap or transaction described in clause (i) or (ii) above is to be settled by delivery of any Units, Series A Preferred Units, Series B Preferred Units or such other non-convertible securities that are substantially similar to the Units, in cash or otherwise. The foregoing sentence shall not apply to the sale of the Units hereunder to the Underwriters.

(i) Compliance with Sarbanes-Oxley Act . Each of the Teekay Entities will comply in all material respects with all applicable provisions of the Sarbanes-Oxley Act of 2002.

(j) Price Manipulation. The Teekay Entities will not take, directly or indirectly, any action designed to or that would constitute or that could reasonably be expected to cause or result in, under the Exchange Act or otherwise, stabilization or manipulation of the price of any security of the Partnership to facilitate the sale or resale of the Units.

(k) Expenses . The Partnership agrees to pay the costs and expenses relating to the following matters: (i) the preparation, printing or reproduction and filing with the Commission of the Registration Statement (including financial statements and exhibits thereto), each Preliminary Prospectus, the Prospectus, any Issuer Free Writing Prospectus and each amendment or supplement to any of them; (ii) the printing (or reproduction) and delivery (including postage, air freight charges and charges for counting and packaging) of such copies of the Registration Statement, each Preliminary Prospectus, the Prospectus, each Issuer Free Writing Prospectus, and all amendments or supplements to any of them, as may, in each case, be reasonably requested for use in connection with the offering and sale of the Units; (iii) the preparation, printing, authentication, issuance and delivery of certificates for the Units, including any stamp or transfer taxes in connection with the original issuance and sale of the Units; (iv) the printing (or reproduction) and delivery of this Agreement, any blue sky memorandum and all other agreements or documents printed (or reproduced) and delivered in connection with the Offering; (v) the registration of the Units under the Exchange Act and the listing of the Units on the NYSE; (vi) any registration or qualification of the Units for offer and sale under the securities or blue sky laws of the several states (including filing fees and the reasonable fees and expenses of counsel for the Underwriters relating to such registration and qualification); (vii) any filings required to be made with FINRA (including filing fees); (viii) the transportation and other expenses incurred by or on behalf of Partnership representatives in connection with presentations to prospective purchasers of the Units; (ix) the fees and expenses of the Partnership’s accountants and the fees and expenses of counsel (including local and special counsel) for the Partnership; and (x) all other costs and expenses of the Partnership or the Teekay Entities incident to the performance by them of their obligations hereunder. Notwithstanding the foregoing, it is understood that, except as expressly provided in this subsection (k) and Sections 7 and 8 hereof, the Underwriters will pay all of their own costs and expenses, including without limitation, fees and disbursements of their counsel, transfer taxes on the resale by them of any of the Units, the transportation and other expenses incurred by or on their behalf in connection with presentations to potential purchasers of Units and any advertising expenses relating to offers of Units they may make.

(l) Use of Proceeds . The Teekay Entities will use the net proceeds received by them from the sale of the Units as set forth in the Disclosure Package and the Prospectus.

(m) Investment Company; PFIC . For a period of four years after the Closing Date or, if later, any Option Closing Date, the Partnership will use its commercially reasonable efforts to avoid any Teekay Entity, or any subsidiary thereof, from becoming (i) required to register as an “investment company” as defined in the 1940 Act, or (ii) a PFIC with respect to any U.S. unitholder.

(n) PFIC Notice to Unitholders . If the Partnership notifies its unitholders that it or a subsidiary will be a PFIC, it will contemporaneously give similar notice to the Underwriters, along with information concerning the potential availability of a “qualified electing fund” election (or elections) under Section 1295 of the Code or any other applicable election with respect to each Teekay Entity that is a PFIC.

(o) Sanctions Laws and Regulations . The Teekay Entities will not take, and will cause each subsidiary not to take, directly or indirectly, any action that could reasonably be expected to result in a violation by any U.S. person participating in the Offering of any Sanctions with respect to the sale of the Units hereunder. Further, the Partnership will not use, and will cause each subsidiary not to use, the proceeds from the sale of the Units, directly or indirectly, for any purpose or activity that would cause the Underwriters or any purchaser of the Units to be in violation of any Sanctions or for any agent or “Specially Designated National” of any country the subject of Sanctions, or any person or entity of any country the subject of Sanctions.

(p) Final Term Sheet . The Partnership will prepare a final term sheet (the “ Final Term Sheet ”) containing only a description of the final terms of the Units and their offering, in a form approved by the Representatives and attached as Schedule V hereto, and acknowledges that the Final Term Sheet is an Issuer Free Writing Prospectus and will comply with its related obligations set forth in Section 5(q) hereof. The Partnership will furnish to each Underwriter, without charge, copies of the Final Term Sheet promptly upon its completion.

(q) Issuer Free Writing Prospectuses . The Partnership agrees that, unless it obtains the prior written consent of the Representatives, it will not make any offer relating to the Units that would constitute an Issuer Free Writing Prospectus or that would otherwise constitute a “free writing prospectus,” or a portion thereof, required to be filed by the Partnership with the Commission or retained by the Partnership under Rule 433; provided that the Representatives will be deemed to have consented to the Issuer Free Writing Prospectuses listed on Schedule IV hereto and any “road show that is a written communication” within the meaning of Rule 433(d)(8)(i) that has been reviewed by the Representatives. The Partnership represents that it has treated or agrees that it will treat each such free writing prospectus consented to, or deemed consented to, by the Representatives as an Issuer Free Writing Prospectus and that it has complied and will comply with the applicable requirements of Rule 433 with respect thereto, including timely filing with the Commission where required, legending and record keeping. If at any time following issuance of an Issuer Free Writing Prospectus there occurred or occurs an

event or condition as a result of which such Issuer Free Writing Prospectus conflicted or would conflict with the information contained in the Registration Statement, any Preliminary Prospectus or the Prospectus or included or would include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at that subsequent time, not misleading, the Partnership will promptly notify the Representatives in writing and will promptly amend or supplement, at its own expense, such Issuer Free Writing Prospectus to eliminate or correct such conflict, untrue statement or omission.

(r) NYSE Listing . The Partnership will use commercially reasonable efforts to effect the listing of the Units on the NYSE within 30 days after the Closing Date and, upon such listing, will use commercially reasonable efforts to maintain such listing and satisfy the requirements for such continued listing.

(s) DTC . The Partnership will use commercially reasonable efforts to assist the Underwriters in arranging for the Units to be eligible for clearance, settlement and trading through the facilities of DTC.

6. Conditions to the Obligations of the Underwriters. The obligations of the Underwriters to purchase the Firm Units and the Option Units, as the case may be, shall be subject to the accuracy of the representations and warranties on the part of the Teekay Parties contained herein as of the Applicable Time, the Closing Date and any Option Closing Date, to the accuracy of the statements of the Teekay Parties made in any certificates delivered pursuant to the provisions hereof, to the performance by the Teekay Parties of their obligations hereunder and to the following additional conditions:

(a) The Prospectus shall have been timely filed with the Commission in accordance with Section 5(a) of this Agreement; no stop order suspending the effectiveness of the Registration Statement or preventing or suspending the use of the Disclosure Package, the Prospectus or any Issuer Free Writing Prospectus shall have been issued and no proceeding or examination for such purpose shall have been initiated or threatened by the Commission; and any request of the Commission for inclusion of additional information in the Registration Statement or the Prospectus or otherwise shall have been disclosed to the Representatives and complied with to their satisfaction.

(b) All corporate, partnership and limited liability company proceedings and other legal matters incident to the authorization, form and validity of this Agreement, the Restated Partnership Agreement, the Registration Statement, the Disclosure Package, the Prospectus, any Issuer Free Writing Prospectus and all other legal matters relating to this Agreement, the Restated Partnership Agreement and the transactions contemplated hereby and thereby shall be reasonably satisfactory in all material respects to counsel for the Underwriters, and the Partnership shall have furnished to such counsel all documents and information that they may reasonably request to enable them to pass upon such matters.

(c) The Partnership shall have requested and caused Watson Farley & Williams LLP, special regulatory and Marshall Islands counsel for the Partnership, to have furnished to you their written opinion, dated the Closing Date (or any Option Closing Date, as

applicable) and addressed to you, in form and substance reasonably satisfactory to the Underwriters, of the same tenor as the opinion provided in Annex A .

(d) The Partnership shall have requested and caused Perkins Coie LLP, counsel for the Partnership, to have furnished to you their written opinion, dated the Closing Date (or any Option Closing Date, as applicable) and addressed to you, in form and substance reasonably satisfactory to the Underwriters, of the same tenor as the opinion provided in Annex B-1 .

(e) The Partnership shall have requested and caused Perkins Coie LLP, counsel for the Partnership, to have furnished to you a confirmation, dated the Closing Date (or any Option Closing Date, as applicable) and addressed to you, in form and substance reasonably satisfactory to the Underwriters, of the same tenor as the statement provided in Annex B-2 .

(f) The Partnership shall have requested and caused McCarthy Tetrault, special Canadian tax counsel for the Partnership, to have furnished to you their written opinion, dated the Closing Date and addressed to you, in form and substance reasonably satisfactory to the Underwriters.

(g) The Partnership shall have requested and caused:

(i) Thommessen Krefting Greve Lund AS, Norwegian counsel for the Partnership, to have furnished to you their written opinion, dated the Closing Date and addressed to you, in form and substance reasonably satisfactory to the Underwriters.

(ii) MNKS, Luxembourg counsel for the Partnership, to have furnished to you their written opinion, dated the Closing Date and addressed to you, in form and substance reasonably satisfactory to the Underwriters.

(iii) Houthoff Buruma Coöperatief U.A., Netherlands counsel for the Partnership, to have furnished to you their written opinion, dated the Closing Date and addressed to you, in form and substance reasonably satisfactory to the Underwriters.

(iv) Wong Tan & Molly Lim LLC, Singapore counsel for the Partnership, to have furnished to you their letter, dated the Closing Date and addressed to you, in form and substance reasonably satisfactory to the Underwriters.

(v) Alexanders, Bermuda counsel for the Partnership, to have furnished to you their letter, dated the Closing Date and addressed to you, in form and substance reasonably satisfactory to the Underwriters.

(vi) Watson Farley & Williams LLP, English counsel for the Partnership, to have furnished to you their letter, dated the Closing Date and addressed to you, in form and substance reasonably satisfactory to the Underwriters.

(vii) Dentons Australia Pty Ltd., Australian counsel for the Partnership, to have furnished to you their letter, dated the Closing Date and addressed to you, in form and substance reasonably satisfactory to the Underwriters.

(h) The Underwriters shall have received from Vinson & Elkins L.L.P., counsel for the Underwriters, such opinion or opinions, dated the Closing Date (or any Option Closing Date, as applicable) and addressed to the Underwriters, with respect to such matters as the Representatives may reasonably require, and the Partnership shall have furnished to such counsel such documents as they request for the purpose of enabling them to pass upon such matters.

(i) The General Partner shall have furnished to the Underwriters a certificate signed by Ingvild Sæther and David Wong, as Chief Executive Officer and Chief Financial Officer, respectively, of Teekay Offshore Group Ltd. dated the Closing Date (or any Option Closing Date, as applicable) and addressed to the Underwriters, to the effect that the signers of such certificate have carefully examined this Agreement, the Registration Statement, the Prospectus, the Disclosure Package, each Non-Prospectus Road Show used in connection with this Offering and any Issuer Free Writing Prospectus and any amendment or supplement thereto and that:

(i) the representations and warranties of the Teekay Parties in this Agreement are true and correct on and as of the Closing Date or any Option Closing Date with the same effect as if made on such date and each Teekay Party has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied at or prior to the Closing Date or any Option Closing Date;

(ii) no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or, to such officer’s knowledge, threatened;

(iii) since the date of the most recent financial statements included in the Registration Statement, the Disclosure Package (exclusive of any supplement thereto) or the Prospectus (exclusive of any supplement thereto), there has been no material adverse effect on the general affairs, condition (financial or otherwise), results of operations, business, properties, assets or prospects of the Teekay Entities, taken as a whole, whether or not arising from transactions in the ordinary course of business, except as set forth in or contemplated in the Registration Statement, the Disclosure Package (exclusive of any supplement thereto) or the Prospectus (exclusive of any supplement thereto); and

(iv) such other matters as you may reasonably request.

(j) The Partnership shall have requested and caused Teekay Holdings to furnish to the Underwriters a certificate signed by its President dated the Closing Date (or any Option Closing Date, as applicable) and addressed to the Underwriters, to the effect that:

(i) Teekay Holdings beneficially owns 40,027,418 Common Units and 51% of the membership interests in the General Partner free and clear of all pledges, liens, encumbrances, security interests or other claims, except (i) as otherwise described in, referred to or disclosed in the Registration Statement, the Disclosure Package or the Prospectus, (ii) pursuant to the Margin Loan Agreement, (iii) any pledges, liens or

security interests pursuant to credit agreements, security agreements or financing documents described in, referred to or disclosed in the Registration Statement, the Disclosure Package or the Prospectus, and (iv) restrictions on transferability contained in the relevant organizational documents or under applicable securities laws, as applicable; and

(ii) such other matters as you may reasonably request.

(k) The Partnership shall have requested and caused KPMG LLP to have furnished to the Underwriters, at the time of execution of this Agreement and at the Closing Date (or any Option Closing Date, as applicable), letters, dated respectively as of the date hereof and as of such Closing Date or Option Closing Date, in form and substance reasonably satisfactory to the Representatives.

(l) Subsequent to the Applicable Time or, if earlier, the dates as of which information is given in the Registration Statement (exclusive of any amendment thereof), the Disclosure Package (exclusive of any supplement thereto) and the Prospectus (exclusive of any supplement thereto), there shall not have been (i) any change or decrease specified in the letter or letters referred to in paragraph (k) of this Section 6 or (ii) any change, or any development involving a prospective change, in or affecting the general affairs, management, condition (financial or otherwise), stockholders’ equity, partners’ equity, members’ equity, results of operations, business, properties, assets or prospects of the Teekay Entities taken as a whole, whether or not arising from transactions in the ordinary course of business, except as set forth in or contemplated in the Registration Statement, the Disclosure Package and the Prospectus (exclusive of any supplement thereto) the effect of which, in any case referred to in clause (i) or (ii) above, is, in the sole judgment of the Representatives, so material and adverse as to make it impractical or inadvisable to proceed with the offering or delivery of the Units as contemplated by the Registration Statement (exclusive of any amendment thereof), the Disclosure Package (exclusive of any supplement thereto) and the Prospectus (exclusive of any supplement thereto).

(m) Prior to the Closing Date (or any Option Closing Date, as applicable), the Teekay Entities shall have furnished to the Underwriters such further information, certificates and documents as the Representatives may reasonably request.

(n) Subsequent to the Applicable Time, there shall not have been any decrease in the rating of any of the debt securities of any of the Teekay Entities, if applicable, by any “nationally recognized statistical rating organization” (as defined for purposes of Rule 436(g) under the Act) or any notice given of any intended or potential decrease in any such rating or of a possible change in any such rating that does not indicate the direction of the possible change.

(o) On or prior to the Closing Date, the Partnership shall have taken all necessary action for listing the Units on the NYSE within 30 days of the Closing Date.

(p) On the Closing Date, the Units shall be eligible for clearance, settlement and trading through the facilities of DTC.

(q) If any of the conditions specified in this Section 6 shall not have been fulfilled when and as provided in this Agreement, or if any of the opinions and certificates

mentioned above or elsewhere in this Agreement shall not be reasonably satisfactory in form and substance to the Representatives and counsel for the Underwriters, this Agreement and all obligations of the Underwriters hereunder may be canceled at, or at any time prior to, the Closing Date (or any Option Closing Date, as applicable) by the Representatives. Notice of such cancellation shall be given to the Partnership in writing or by telephone or facsimile confirmed in writing.

7. Reimbursement of Underwriters ’ Expenses. If the sale of the Units provided for herein is not consummated because any condition to the obligations of the Underwriters set forth in Section 6 hereof is not satisfied, because of any termination pursuant to Section 10 hereof or because of any refusal, inability or failure on the part of the Teekay Parties to perform any agreement herein or comply with any provision hereof other than by reason of a default by any of the Underwriters, the Teekay Parties will reimburse the Underwriters severally through the Representatives on demand for all out of pocket expenses (including reasonable fees and disbursements of counsel) that shall have been reasonably incurred by them in connection with the proposed purchase and sale of the Units.

8. Indemnification and Contribution. (a) The Teekay Parties, jointly and severally, agree to indemnify and hold harmless each Underwriter, the directors, officers, employees, agents and affiliates of each Underwriter and each person who controls any Underwriter within the meaning of either the Act or the Exchange Act against any and all losses, claims, damages or liabilities, joint or several, to which they or any of them may become subject under the Act, the Exchange Act or other Federal or state statutory law or regulation, at common law or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement as originally filed or in any amendment thereof, or in the Disclosure Package, any Issuer Free Writing Prospectus, any Non-Prospectus Road Show or the Prospectus or in any amendment thereof or supplement thereto or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and agrees to reimburse each such indemnified party, as incurred, for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action; provided , however , that the Teekay Parties will not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon any such untrue statement or alleged untrue statement or omission or alleged omission made therein in reliance upon and in conformity with written information furnished to the Teekay Parties through the Representatives by or on behalf of any Underwriter specifically for inclusion therein. This indemnity agreement will be in addition to any liability which the Teekay Parties may otherwise have.

(b) Each Underwriter severally and not jointly agrees to indemnify and hold harmless the Teekay Parties, each of their respective directors, each of their respective officers who signs the Registration Statement, and each person who controls the Teekay Parties within the meaning of either the Act or the Exchange Act, to the same extent as the indemnity in Section 8(a) from the Teekay Parties to each Underwriter, but only with reference to written information relating to such Underwriter furnished to the Teekay Parties through the Representatives by or on behalf of such Underwriter specifically for inclusion in the documents referred to in the foregoing indemnity. This indemnity agreement will be in addition to any

liability which any Underwriter may otherwise have. The Underwriters confirm and the Teekay Parties acknowledge that the statements set forth (i) in the first paragraph under the heading “Underwriting—Underwriting Discounts and Expenses” and (ii) under the heading “Underwriting—Price Stabilization, Short Positions and Penalty Bids” in the Preliminary Prospectus and the Prospectus constitute the only information concerning the Underwriters furnished in writing to the Partnership through the Representatives by or on behalf of the Underwriters specifically for inclusion in the Registration Statement, the Disclosure Package, the Prospectus and any Issuer Free Writing Prospectus or Non-Prospectus Road Show.

(c) Promptly after receipt by an indemnified party under this Section 8 of notice of the commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under this Section 8, notify the indemnifying party in writing of the commencement thereof; but the failure so to notify the indemnifying party (i) will not relieve it from liability under paragraph (a) or (b) above unless and to the extent it did not otherwise learn of such action and such failure results in the forfeiture by the indemnifying party of substantial rights and defenses and (ii) will not, in any event, relieve the indemnifying party from any obligations to any indemnified party other than the indemnification obligation provided in paragraph (a) or (b) above. The indemnifying party shall be entitled to appoint counsel of the indemnifying party’s choice at the indemnifying party’s expense to represent the indemnified party in any action for which indemnification is sought (in which case the indemnifying party shall not thereafter be responsible for the fees and expenses of any separate counsel retained by the indemnified party or parties except as set forth below); provided, however, that such counsel shall be reasonably satisfactory to the indemnified party. Notwithstanding the indemnifying party’s election to appoint counsel to represent the indemnified party in an action, the indemnified party shall have the right to employ one separate counsel (in addition to local counsel), and the indemnifying party shall bear the reasonable fees, costs and expenses of such separate counsel if (i) the use of counsel chosen by the indemnifying party to represent the indemnified party would present such counsel with a conflict of interest, (ii) the actual or potential defendants in, or targets of, any such action include both the indemnified party and the indemnifying party and the indemnified party shall have reasonably concluded that there may be legal defenses available to it and/or other indemnified parties which are different from or additional to those available to the indemnifying party, (iii) the indemnifying party shall not have employed counsel reasonably satisfactory to the indemnified party to represent the indemnified party within a reasonable time after notice of the institution of such action or (iv) the indemnifying party shall authorize the indemnified party to employ separate counsel at the expense of the indemnifying party. An indemnifying party will not, without the prior written consent of the indemnified parties (which consent shall not be unreasonably withheld, conditioned or delayed), settle or compromise or consent to the entry of any judgment with respect to any pending or threatened claim, action, suit or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified parties are actual or potential parties to such claim or action) unless such settlement, compromise or consent (i) includes an unconditional release of each indemnified party from all liability arising out of such claim, action, suit or proceeding and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.

(d) In the event that the indemnity provided in paragraph (a) or (b) of this Section 8 is unavailable to or insufficient to hold harmless an indemnified party for any reason, the Teekay Parties, severally and jointly, and the Underwriters, severally, agree to contribute to the aggregate losses, claims, damages and liabilities (including legal or other expenses reasonably incurred in connection with investigating or defending the same) (collectively “ Losses ”) to which one or more of the Teekay Parties and one or more of the Underwriters may be subject in such proportion as is appropriate to reflect the relative benefits received by the Teekay Parties on the one hand and by the Underwriters on the other from the Offering; provided , however , that in no case shall any Underwriter (except as may be provided in any agreement among underwriters relating to the Offering) be responsible for any amount in excess of the underwriting discount or commission applicable to the Units purchased by such Underwriter hereunder. If the allocation provided by the immediately preceding sentence is unavailable for any reason, the Teekay Parties and the Underwriters severally shall contribute in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Teekay Parties on the one hand and of the Underwriters on the other in connection with the statements or omissions which resulted in such Losses as well as any other relevant equitable considerations. Benefits received by the Teekay Parties shall be deemed to be equal to the total net proceeds from the Offering (before deducting expenses) received by the Partnership, and benefits received by the Underwriters shall be deemed to be equal to the total underwriting discounts and commissions, in each case as set forth on the cover page of the Prospectus. Relative fault shall be determined by reference to, among other things, whether any untrue or any alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information provided by the Teekay Parties on the one hand or the Underwriters on the other, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such untrue statement or omission. The Teekay Parties and the Underwriters agree that it would not be just and equitable if contribution were determined by pro rata allocation or any other method of allocation which does not take account of the equitable considerations referred to above. Notwithstanding the provisions of this paragraph (d), no person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section 8, each person who controls an Underwriter within the meaning of either the Act or the Exchange Act and each director, officer, employee and agent of an Underwriter shall have the same rights to contribution as such Underwriter, and each person who controls any of the Teekay Parties within the meaning of either the Act or the Exchange Act, each officer of the Teekay Parties who shall have signed the Registration Statement and each director of the Teekay Parties shall have the same rights to contribution as the Teekay Parties, subject in each case to the applicable terms and conditions of this paragraph (d).

9. Default by an Underwriter. If any one or more Underwriters shall fail to purchase and pay for any of the Units agreed to be purchased by such Underwriter or Underwriters hereunder and such failure to purchase shall constitute a default in the performance of its or their obligations under this Agreement, the remaining Underwriters shall be obligated severally to take up and pay for (in the respective proportions which the amount of Units set forth opposite their names in Schedule I hereto bears to the aggregate amount of Units set forth opposite the names of all the remaining Underwriters) the Units which the defaulting Underwriter or Underwriters agreed but failed to purchase; provided , however , that in the event that the

aggregate amount of Units which the defaulting Underwriter or Underwriters agreed but failed to purchase shall exceed 10% of the aggregate amount of Units set forth in Schedule I hereto, the remaining Underwriters shall have the right to purchase all, but shall not be under any obligation to purchase any, of the Units, and if such nondefaulting Underwriters do not purchase all the Units, this Agreement will terminate without liability to any nondefaulting Underwriter or the Teekay Parties. In the event of a default by any Underwriter as set forth in this Section 9, the Closing Date shall be postponed for such period, not exceeding five Business Days, as the Representatives shall determine in order that the required changes in the Registration Statement, the Disclosure Package, the Prospectus or in any other documents or arrangements may be effected. Nothing contained in this Agreement shall relieve any defaulting Underwriter of its liability, if any, to the Teekay Parties and any nondefaulting Underwriter for damages occasioned by its default hereunder.

10. Termination. This Agreement shall be subject to termination in the absolute discretion of the Representatives, by notice given to the Partnership prior to delivery of and payment for the Units, if at any time prior to such time (i) trading in the Partnership’s Common Units, Series A Preferred Units, the Series B Preferred Units or Series E Preferred Units shall have been suspended by the Commission or the NYSE or trading in securities generally on the NYSE shall have been suspended or limited or minimum prices shall have been established on such exchange, (ii) a banking moratorium shall have been declared either by Federal or New York State authorities or (iii) there shall have occurred any outbreak or escalation of hostilities, declaration by the United States of a national emergency or war, or other calamity or crisis the effect of which on financial markets is such as to make it, in the sole judgment of the Representatives, impractical or inadvisable to proceed with the offering or delivery of the Units as contemplated by the Disclosure Package or the Prospectus (in each case exclusive of any supplement thereto).

11. Representations and Indemnities to Survive. The respective agreements, representations, warranties, indemnities and other statements of the Teekay Parties or their officers and of the Underwriters set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation made by or on behalf of any Underwriter or the Teekay Parties or any of the officers, directors, employees, agents or controlling persons referred to in Section 8 hereof, and will survive delivery of and payment for the Units. The provisions of Sections 5(k), 7, 8 and 9 hereof shall survive the termination or cancellation of this Agreement.

12. Notices. All communications hereunder will be in writing and effective only on receipt, and, if sent to the Representatives, will be mailed, delivered or telefaxed to (a) Morgan Stanley & Co. LLC, 1585 Broadway, New York, New York 10036, Attn: Equity Syndicate Desk with copies to UBS Securities LLC, 1285 Avenue of the Americas, New York, NY 10019, Attn: Fixed Income Syndicate (fax no. 203-719-0495); or, (b) if sent to the Partnership, will be mailed, delivered or telefaxed to Teekay Offshore Partners L.P., 4th Floor, Belvedere Building, 69 Pitts Bay Road, Hamilton, HM 08, Bermuda, Attn. Corporate Secretary (fax no. 441-292-3931) with a copy to Perkins Coie LLP, 1120 N.W. Couch Street, 10th Floor, Portland, Oregon 97209-4128, Attn: David Matheson (fax no. 503-346-2008).

13. Successors. This Agreement will inure to the benefit of and be binding upon the parties hereto and their respective successors and the officers, directors, employees, agents and controlling persons referred to in Section 8 hereof, and no other person will have any right or obligation hereunder.

14. Applicable Law . This Agreement will be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and to be performed within the State of New York.

15. Integration . This Agreement supersedes all prior agreements and understandings (whether written or oral) between the Teekay Parties and the Underwriters, or any of them, with respect to the subject matter hereof.

16. Judicial Proceedings .

(a) The Teekay Parties irrevocably (i) agree that any legal suit, action or proceeding against the Teekay Parties arising out of or based upon this Agreement, the transactions contemplated hereby or alleged violations of the securities laws of the United States or any state in the United States may be instituted in any New York court, (ii) waive, to the fullest extent it may effectively do so, any objection which it may now or hereafter have to the laying of venue of any such proceeding in any New York court and (iii) submit to the exclusive jurisdiction of such courts in any such suit, action or proceeding. Each of the Teekay Parties has appointed Puglisi & Associates, as its authorized agent (the “ Authorized Agent ”), upon whom process may be served in any such action arising out of or based on this Agreement, the transactions contemplated hereby or any alleged violation of the securities laws of the United States or any state in the United States which may be instituted in any New York court, expressly consents to the jurisdiction of any such court in respect of any such action, and waives any other requirements of or objections to personal jurisdiction with respect thereto. Such appointment shall be irrevocable. The Teekay Parties represent and warrant that the Authorized Agent has agreed to act as such agent for service of process and agrees to take any and all action, including the filing of any and all documents and instruments, that may be necessary to continue such appointment in full force and effect as aforesaid. Service of process upon the Authorized Agent and written notice of such service to the Teekay Parties shall be deemed, in every respect, effective service of process upon the Teekay Parties.

(b) If for the purposes of obtaining judgment in any court it is necessary to convert a sum due hereunder into any currency other than United States dollars, the parties hereto agree, to the fullest extent that they may effectively do so, that the rate of exchange used shall be the rate at which in accordance with normal banking procedures the Underwriters could purchase United States dollars with such other currency in the City of New York on the business day proceeding that on which final judgment is given. The obligations of the Teekay Parties in respect of any sum due from it to the Underwriters shall, notwithstanding any judgment in a currency other than United States dollars, not be discharged until the first business day, following receipt by the Underwriters of any sum adjudged to be so due in such other currency, on which (and only to the extent that) the Underwriters may in accordance with normal banking procedures purchase United States dollars with such other currency; if the United States dollars so purchased are less than the sum originally due to the Underwriters hereunder, the Teekay

Parties agree, as a separate obligation and notwithstanding any such judgment, that the party responsible for such judgment shall indemnify the Underwriters against such loss. If the United States dollars so purchased are greater than the sum originally due to the Underwriters hereunder, the Underwriters agree to pay to the Teekay Parties an amount equal to the excess of the dollars so purchased over the sum originally due to the Underwriters hereunder.

17. Counterparts . This Agreement may be signed in one or more counterparts, each of which shall constitute an original and all of which together shall constitute one and the same agreement.

18. Headings. The section headings used herein are for convenience only and shall not affect the construction hereof.

19. No Fiduciary Duty . The Partnership hereby acknowledges that (a) the Underwriters are acting as a principal and not as an agent or fiduciary of the Partnership and (b) its engagement of the Underwriters in connection with the Offering is as independent contractors and not in any other capacity. Furthermore, the Partnership agrees that it is solely responsible for making its own judgments in connection with the Offering (irrespective of whether the Underwriters have advised or are currently advising the Partnership on related or other matters).

20. Definitions. The terms that follow, when used in this Agreement, shall have the meanings indicated.

“ Applicable Time ” shall mean 3:35 P.M. (New York City time) on January 16, 2018, which the Representatives have informed the Partnership is a time prior to the first sale of the Units;

“ Base Prospectus ” shall mean the base prospectus referred to in the second sentence of Section 1(a) above contained in the Registration Statement at the initial Effective Date.

“ Commission ” shall mean the United States Securities and Exchange Commission.

“ Disclosure Package ” shall mean (i) the Preliminary Prospectus, as amended and supplemented to the Applicable Time, (ii) the Issuer Free Writing Prospectuses identified in Schedule IV hereto and (iii) any other Free Writing Prospectus that the parties hereto shall hereafter expressly agree in writing to treat as part of the Disclosure Package.

“ Effective Date ” shall mean each date and time that the Registration Statement, any post-effective amendment or amendments thereto and any Rule 462(b) Registration Statement became or becomes effective.

“ Free Writing Prospectus ” shall mean a free writing prospectus, as defined in Rule 405.

“ Issuer Free Writing Prospectus ” shall mean an issuer free writing prospectus, as defined in Rule 433.

“ Preliminary Prospectus ” shall mean any preliminary prospectus supplement to the Base Prospectus, which describes the Units and the offering thereof and which is used prior to the filing of the Prospectus, together with the Base Prospectus.

“ Prospectus ” shall mean the final prospectus supplement relating to the Units, including the accompanying Base Prospectus, as filed with the Commission pursuant to Rule 424(b) of the Act and the rules and regulations of the Commission promulgated thereunder;

“ Registration Statement ” shall mean the registration statement referred to in the second sentence of Section 1(a) above, including exhibits and financial statements and any prospectus supplement relating to the Units that is filed with the Commission pursuant to Rule 424(b) and deemed part of such registration statement pursuant to Rule 430B, as amended at the Applicable Time and, in the event any post-effective amendment thereto or any Rule 462(b) Registration Statement becomes effective prior to the Closing Date, shall also mean such registration statement as so amended or such Rule 462(b) Registration Statement, as the case may be.

“Rule 158”, “Rule 163”, “Rule 164”, “Rule 172”, “Rule 405”, “Rule 415”, “Rule 424”, “Rule 430B”, “Rule 433” and “Rule 462” refer to such rules under the Act.

“ Rule 462(b) Registration Statement ” shall mean a registration statement and any amendments thereto filed pursuant to Rule 462(b) relating to the offering covered by the Registration Statement.

If the foregoing is in accordance with your understanding of our agreement, please sign and return to us the enclosed duplicate hereof, whereupon this letter and your acceptance shall represent a binding agreement among the Teekay Parties and the several Underwriters.


Very truly yours,

Teekay Offshore Partners L.P.

By:	Teekay Offshore GP L.L.C., its general partner

By:	/s/ Edith Robinson
	Name:	Edith Robinson
	Title:	Secretary

Teekay Offshore GP L.L.C.

By:	/s/ Edith Robinson
	Name:	Edith Robinson
	Title:	Secretary

The foregoing Agreement is hereby

confirmed and accepted as of the date

first written above.

Morgan Stanley & Co. LLC

UBS Securities LLC


By:	Morgan Stanley & Co. LLC

By:	/s/ Yurij Slyz
	Name:	Yurij Slyz
	Title:	Executive Director

By:	UBS Securities LLC

By:	/s/ Clare Qi
	Name:	Clare Qi
	Title:	Director

By:	/s/ Aum Dasani
	Name:	Aum Dasani
	Title:	Associate Director

For themselves and the other several

Underwriters named in Schedule I to the

foregoing Agreement.

SCHEDULE I


Underwriters	Number of Firm Units to be Purchased
Morgan Stanley & Co. LLC		1,667,500
UBS Securities LLC		1,667,500
J.P. Morgan Securities LLC		460,000
Stifel, Nicolaus & Company, Incorporated		460,000
Commonwealth Bank of Australia		115,000
ING Financial Markets LLC		115,000
Scotia Capital (USA) Inc.		115,000

Total		4,600,000

SCHEDULE II

Operating Subsidiaries and Ownership

1.	The Partnership directly owns:

(a)

all of the issued and outstanding stock of Teekay Offshore Finance Corp., a Marshall Islands corporation;

(b)

100% of the outstanding stock of Teekay FSO Finance Pty Ltd., an Australian corporation, which directly owns 100% of the outstanding stock of Teekay Australia Offshore Holdings Pty Ltd., an Australian corporation (“ TAOH ”), which directly owns 100% of the membership interest in Dampier Spirit L.L.C., a Marshall Islands limited liability company (“ Dampier Spirit ”).

(c)

a 100% membership interest in Varg L.L.C., a Marshall Islands limited liability company (“ Varg LLC ”), which directly owns (i) a 1% interest in Teekay Offshore European Holdings Cooperatief U.A., a Dutch corporation (“ TOEH ”), and (ii) 100% of the outstanding stock of Teekay Varg Production Limited;

(d)

a 100% membership interest in Teekay Offshore Holdings;

(e)

a 100% membership interest in Teekay Al Rayyan L.L.C., a Marshall Islands limited liability company; and

(f)

a 0.01% interest in Teekay Piranema Servicos de Petroleo Ltda., a sociedad limitada organized under the laws of Brazil.

2.	Teekay Offshore Holdings directly owns:

(a)

a 100% membership interest in ShuttleCo;

(b)

a 100% membership interest in Teekay Hiload LLC, a Marshall Islands limited liability company;

(c)

a 100% membership interest in Gina Krogg L.L.C., a Marshall Islands limited liability company;

(d)

100% of the outstanding shares of Gina Krog Offshore Pte. Ltd. , a Singapore corporation, which directly owns 100% of the outstanding stock of Gina Krog AS, a Norwegian corporation;

(e)

a 100% membership interest in Knarr L.L.C., a Marshall Islands limited liability company;

(f)

a 100% membership interest in Clipper L.L.C., a Marshall Islands limited liability company;

(g)

100% of the outstanding stock of Teekay Offshore Group Ltd., a Marshall Islands corporation;

(h)

a 100% membership interest in Pattani Spirit L.L.C., a Marshall Islands limited liability company (“ Pattani Spirit ”);

(i)

a 100% membership interest in Piranema L.L.C., a Marshall Islands limited liability company;

(j)

a 100% interest in Tiro Sidon L.L.C. , a Marshall Islands limited liability company (“ Tiro Sidon ”);

(k)

a 100% interest in Voyageur L.L.C., a Marshall Islands limited liability company which directly owns 100% of the shares of Teekay Voyageur Production Limited, a company incorporated under the Companies Act of Scotland;

(l)

a 100% membership interest in the Arendal Spirit L.L.C., a Marshall Islands limited liability company;

(m)

a 100% membership interest in Logitel Offshore Rig II L.L.C., a Marshall Islands limited liability company;

(n)

a 100% membership interest in Logitel Offshore Rig III L.L.C., a Marshall Islands limited liability company;

(o)

a 100% membership interest in Logitel Offshore Rig IV L.L.C., a Marshall Islands limited liability company;

(p)

a 100% membership interest in Siri Holdings L.L.C., a Marshall Islands limited liability company (“ Siri Holdings ”);

(q)

a 100% membership interest in Logitel Offshore L.L.C., a Marshall Islands limited liability company;

(r)

100% of the outstanding shares of Logitel Offshore Pte. Ltd., a Singapore corporation (“ Logitel Pte ”);

(s)

100% of the outstanding shares of Logitel Offshore Holdings Pte. Ltd., a Singapore corporation;

(t)

a 100% membership interest in Apollo Spirit L.L.C., a Marshall Islands limited liability company (“ Apollo Spirit ”);

(u)

a 100% membership interest in Petrojarl I L.L.C., a Marshall Islands limited liability company;

(v)

a 100% membership interest in Teekay Offshore Operating Holdings L.L.C., a Marshall Islands limited liability company, which directly owns a 100% membership interest in Teekay Offshore Chartering L.L.C.; and

(w)

a 99% interest in TOEH.

3.	Logitel Pte directly owns:

(a)

100% of the outstanding shares of Logitel Offshore Rig I Pte. Ltd., a Singapore corporation; and

(b)

100% of the outstanding shares of Logitel Offshore Rig II Pte. Ltd., a Singapore corporation.

4.	ShuttleCo directly owns:

(a)

a 100% membership interest in Samba Spirit L.L.C., a Marshall Islands limited liability company;

(b)

a 100% membership interest in Lambada Spirit. L.L.C., a Marshall Islands limited liability company;

(c)

a 50% membership interest in Navion Gothenburg L.L.C., a Marshall Islands limited liability company (“ Navion Gothenburg ”);

(d)

a 100% membership interest in Navion Bergen L.L.C., a Marshall Islands limited liability company (“ Navion Bergen ”);

(e)

a 100% membership interest in Teekay Shuttle Tanker Finance L.L.C., a Marshall Islands limited liability company (“ Teekay Shuttle Tankers ”);

(f)

a 100% membership interest in the OLP GP, which owns a 0.91% general partner interest in the Operating Company; and

(g)

a 99.09% limited partner interest in the Operating Company.

5.	Teekay Shuttle Tankers directly owns:

(a)

a 100% membership interest in Bossa Nova Spirit L.L.C., a Marshall Islands limited liability company; and

(b)

a 100% membership interest in Sertanejo Spirit L.L.C., a Marshall Islands limited liability company.

6.	The Operating Company directly owns:

(a)

100% of the outstanding stock of Teekay Nordic Holdings Inc., a Marshall Islands corporation (“ Nordic Holdings ”);

(b)

100% of the outstanding stock of Norsk Teekay Holdings Ltd., a Marshall Islands corporation (“ Norsk Holdings ”);

(c)

100% of the outstanding shares of Teekay Offshore Operating Pte. Ltd., a Singapore corporation (“ TOO Pte ”), which directly owns 100% of the outstanding stock of Teekay Navion Offshore Loading Pte. Ltd., a Singapore corporation (“ Teekay Navion ”);

(d)

a 100% membership interest in Amundsen Spirit L.L.C., a Marshall Islands limited liability company (“ Amundsen Spirit ”);

(e)

a 100% membership interest in Nansen Spirit L.L.C., a Marshall Islands limited liability company (“ Nansen Spirit ”);

(f)

a 100% membership interest in Scott Spirit L.L.C., a Marshall Islands limited liability company (“ Scott Spirit ”); and

(g)

a 100% of membership interest in Peary Spirit L.L.C., a Marshall Islands limited liability company. (“ Peary Spirit ”).

7.	TOEH directly owns:

(a)

100% of the outstanding stock of Varg Production AS, a Norwegian corporation;

(b)

100% of the outstanding stock of Piranema Production AS, a Norwegian corporation, which directly owns a 99.99% interest in Piranema Servicios de Petroleo Ltda.;

(c)

100% of the outstanding stock of ALP Maritime Group B.V., a Dutch corporation (“ Dutchco ”), which directly owns 100% of the outstanding stock of ALP Maritime Services B.V., a Dutchco, ALP Maritime Holding B.V., a Dutchco (“ ALP Maritime Holding ”), and ALP Ocean Towage Holding B.V., a Dutchco (“ ALP Towage Holding ”);

(d)

100% of the outstanding stock of Logitel Offshore Holding AS, a Norwegian corporation;

(e)

100% of the outstanding stock of Logitel Offshore Norway AS, a Norwegian corporation;

(f)

100% of the outstanding stock of Petrojarl I Production AS, a Norwegian corporation, which owns a 0.01% interest in Teekay Petrojarl I Servicos de Petroleo Ltda, a sociedad limitada organized under the laws of Brazil;

(g)

a 99.9% interest in Teekay Petrojarl I Servicos de Petroleo Ltda, a sociedad limitada organized under the laws of Brazil;

(h)

100% of the outstanding stock of Teekay Petrojarl Offshore Siri AS, a Norwegian corporation, which directly owns a 1% interest in Teekay Petrojarl Producao Petrolifera do Brasil Ltda., a sociedad limitada organized under the laws of Brazil (“ Petrojarl Producao ”);

(i)

100% of the outstanding stock of Teekay Knarr AS, a Norwegian corporation;

(j)

100% of the outstanding stock of Teekay Offshore Production Holdings AS, a Norwegian corporation, which directly owns 100% of the outstanding stock of Teekay Petrojarl Production AS, a Norwegian corporation;

(k)

100% of the outstanding stock of Teekay Petrojarl Offshore Crewing AS, a Norwegian corporation;

(l)

100% of the stock of Teekay Petrojarl UK Limited, a company organized under the laws of the United Kingdom;

(m)

100% of the outstanding stock of Navion Offshore Loading AS, a Norwegian corporation (“ Navion Offshore ”);

(n)

100% of the outstanding stock of Teekay Norway HiLoad AS, a Norwegian corporation; and

(o)

a 50% interest in OOG-TK Libra GmbH, a limited liability company registered in the Republic of Austria, which owns a nominal interest in OOG-TK Libra GmbH & Co KG, a limited liability company registered in the Republic of Austria (“ OOG-TK Libra ”); and

(p)

a 50% interest in OOG-TK Libra.

8.	ALP Maritime Services B.V. directly owns 100% of ALP Maritime Contractors B.V., a Dutchco.

9.	ALP Maritime Holding directly owns:

(a)

100% of the outstanding stock of ALP Defender B.V., a Dutchco;

(b)

100% of the outstanding stock of ALP Keeper B.V., a Dutchco;

(c)

100% of the outstanding stock of ALP Striker B.V., a Dutchco; and

(d)

100% of the outstanding stock of ALP Sweeper B.V., a Dutcho.

10.	ALP Towage Holding directly owns:

(a)

100% of the outstanding stock of ALP Guard B.V., a Dutchco;

(b)

100% of the outstanding stock of ALP Winger B.V., a Dutchco;

(c)

100% of the outstanding stock of ALP Centre B.V., a Dutchco;

(d)

100% of the outstanding stock of ALP Forward B.V., a Dutchco;

(e)

100% of the outstanding stock of ALP Ace B.V., a Dutchco; and

(f)

100% of the outstanding stock of ALP Ippon B.V., a Dutchco.

11.	OOG-TK Libra directly owns:

(a)

a 100% interest in OOG-TK Operator Holdings, Ltd., a company organized under the laws of the Cayman Islands (“ OOG-TK Operator ”), which directly owns a 0.1% interest in OOG-TK Producao de Petroleao Ltda., a sociedad limitada organized under the laws of Brazil (“ OOG-TK Producao ”); and

(b)

a 99.9% interest in OOG-TK Producao.

12.	Nordic Holdings directly owns:

(a)

a 50% partnership interest in Partrederiet Stena Ugland Shuttle Tankers III DA, a Norwegian shipping partnership regulated under the Marine Act of 1994 (Norway) (“ Stena Natalita ”);

(b)

a 50% membership interest in Stena Spirit L.L.C., an Isle of Man limited liability company (“ Stena Spirit ”);

(c)

a 50% membership interest in Nordic Rio L.L.C., a Marshall Islands limited liability company (“ Nordic Rio ”);

13.	Apollo Spirit directly owns an 89% membership interest in KS Apollo Spirit, a Norwegian limited partnership (“ KS Apollo Spirit ”).

14.

Norsk Holdings directly owns 100% of the outstanding stock of Teekay European Holdings S.a.r.l., a Luxembourg corporation (“ Luxco ”), which directly owns 100% of the outstanding stock of Teekay Netherlands European Holdings B.V., a Dutchco, which directly owns 100% of the outstanding stock of Norsk Teekay AS, a Norwegian corporation (“ Norsk Teekay ”).

15.	Norsk Teekay directly owns:

(a)

100% of the outstanding stock of Teekay Norway AS, a Norwegian corporation (“ Teekay Norway ”).

16.	Teekay Norway directly owns:

(a)

100% of the outstanding stock of Ugland Nordic Shipping AS, a Norwegian corporation (“ Ugland Nordic ”);

(b)

100% of the outstanding stock of Navion Bergen AS, a Norwegian corporation (“ Bergen AS ”);

(c)

100% of the outstanding stock of Navion Gothenburg AS, a Norwegian corporation (“ Gothenburg AS ”);

(d)

100% of the outstanding stock of Teekay Grand Banks Shipping AS, a Norwegian corporation, which directly owns 100% of the outstanding stock of Teekay Grand Banks AS, a Norwegian corporation, which directly owns (i) 100% of the outstanding stock of Teekay (Atlantic) Management ULC, a Canadian corporation, and (ii) 100% of the outstanding stock of Teekay (Atlantic) Chartering ULC, a Canadian corporation;

(e)

100% of the outstanding stock of Teekay SHI Hull No. 2241 AS, a Norwegian corporation (“ SHI Hull No. 2241 ”);

(f)

100% of the outstanding stock of Teekay SHI Hull No. 2242 AS, a Norwegian corporation (“ SHI Hull No. 2242 ”);

(g)

100% of the outstanding stock of Teekay SHI Hull No. 2256 AS, a Norwegian corporation (“ SHI Hull No. 2256 ”); and

(h)

100% of the outstanding stock of Teekay SHI Hull No. 2257 AS, a Norwegian corporation (“ SHI Hull No. 2257 ”).

17.	Ugland Nordic directly owns:

(a)

a 50% interest in Partrederiet Stena Ugland Shuttle Tankers II DA, a Norwegian shipping partnership regulated under the Marine Act of 1994 (Norway); and

(b)

a 50% interest in Partrederiet Stena Ugland Shuttle Tankers I DA, a Norwegian shipping partnership regulated under the Marine Act of 1994 (Norway).

18.	Siri Holdings directly owns:

(a)

a 100% membership interest in TPO Siri LLC, a Marshall Islands limited liability company; and

(b)

a 99% interest in Petrojarl Producao.

19.	Tiro Sidon directly owns:

(a)

a 1% partnership interest in Tiro Sidon UK L.L.P., a limited liability partnership incorporated in England and Wales (“ Tiro Sidon UK ”);

(b)

a 100% membership interest in Tiro Sidon Holdings L.L.C., a Marshall Islands limited liability company, which directly owns a 99% partnership interest in Tiro Sidon UK; and

(c)

a 50% interest in OOG-TKP Oil Services, Ltd., a company organized under the laws of the Cayman Islands.

20.	Tiro Sidon UK directly owns:

(a)

a 50% ownership interest in OOG-TKP FPSO GmbH, a limited liability company registered in the Republic of Austria, which owns a nominal interest in OOG-TKP FPSO GmbH & Co KG, a limited partnership registered in the Republic of Austria (“ OOG-TKP FPSO LP ”); and

(b)

a 50% partnership interest in OOG-TKP FPSO LP, which directly owns (i) a 99.9% ownership interest in OOG-TKP Producao de Petroleao Ltda., a sociedad limitada organized under the laws of Brazil (“ OOG-TKP Producao ”), and (ii) 100% of the stock of OOG-TKP Operator Holdings Limited, a company organized under the laws of the Cayman Islands (“ OOG-TKP Operator ”).

21.	OOG-TKP Operator directly owns 0.1% of OOG-TKP Producao.

22.	Navion Offshore directly owns:

(a)

100% of the outstanding stock of Teekay Shipping Norway AS, a Norwegian corporation, which owns 0.0001% of the outstanding stock of Teekay do Brasil Servicios Maritimos Ltda, a sociedad limitada organized under the laws of Brazil ( Teekay do Brasil ”);

(b)

100% of the outstanding stock of Teekay Shipping Norway (Marine HR) AS, a Norwegian corporation;

(c)

100% of the outstanding stock of Teekay Offshore Crewing AS, a Norwegian corporation;

(d)

99.9999% of the outstanding stock of Teekay do Brasil; and

(e)

100% of the outstanding stock of Teekay Shipping Partners Holding AS, a Norwegian corporation.

SCHEDULE III

List of Owners, Vessels and Registration


	Entity	Vessel	Registration
1.	Amundsen Spirit LLC	Amundsen Spirit	Bahamas
2.	Bossa Nova Spirit LLC	Bossa Nova Spirit	Bahamas
3.	Clipper L.L.C.	Suksan Salamander	Bahamas
4.	Dampier Spirit LLC	Dampier Spirit	Bahamas
5.	KS Apollo Spirit	Apollo Spirit	Liberia
6.	Lambada Spirit LLC	Lambada Spirit	Bahamas
7.	Nansen Spirit LLC	Nansen Spirit	Bahamas
8.	Navion Bergen LLC	Navion Bergen	Bahamas
9.	Navion Gothenburg LLC	Navion Gothenburg	Bahamas
10.	Teekay Navion Offshore Loading Pte. Ltd	Navion Oceania	Bahamas
11.	Teekay Hiload LLC	HiLoad DP No. 1	Cyprus
12.	Teekay Navion Offshore Loading AS	Navion Anglia	Bahamas
13.	Teekay Navion Offshore Loading AS	Navion Scandia	Bahamas
14.	Teekay Navion Offshore Loading AS	Navion Hispania	Canada
15.	Teekay Navion Offshore Loading AS	Navion Britannia	Bahamas
16.	Nordic Rio LLC	Nordic Rio	Bahamas
17.	OOG TKP FPSO Gmbh & Co KG	FPSO Cidade de Itajai	Bahamas
18.	Partrederiet Stena Ugland Shuttle Tankers I DA	Stena Alexita	Bermuda
19.	Partrederiet Stena Ugland Shuttle Tankers III DA	Stena Sirita	Bermuda
20.	Partrederiet Stena Ugland Shuttle Tankers III DA	Stena Natalita	Bahamas
21.	OOG TKP FPSO Gmbh & Co KG	FPSO Pioneiro De Libra	Panama
22.	Gina Krog Offshore Pte. Ltd.	Randgrid	Bahamas
23.	Pattani Spirit LLC	Pattani Spirit	Bahamas
24.	Peary Spirit LLC	Peary Spirit	Bahamas
25.	Piranema LLC	Piranema Spirit	Bahamas
26.	Samba Spirit LLC	Samba Spirit	Bahamas
27.	Sertanejo Spirit LLC	Sertanejo Spirit	Bahamas
28.	Scott Spirit LLC	Scott Spirit	Bahamas
29.	Stena Spirit LLC	Stena Spirit	Bahamas
30.	TPO Siri LLC	Petrojarl Cidade de Rio Das Ostras	Bahamas
31.	Teekay Al Rayyan LLC	Falcon Spirit	Bahamas
32.	Teekay Navion Offshore Loading Pte. Ltd	Navion Stavanger	Bahamas
33.	Teekay Navion Offshore Loading Pte. Ltd	Nordic Spirit	Bahamas
34.	Teekay Navion Offshore Loading Pte. Ltd	Nordic Brasilia	Bahamas
35.	Teekay Navion Offshore Loading Pte. Ltd	Petroatlantic	Bahamas
36.	Teekay Navion Offshore Loading Pte. Ltd	Petronordic	Bahamas


37.	Teekay Navion Offshore Loading Pte. Ltd	Navion Oslo	Bahamas
38.	Varg L.L.C.	Petrojarl Varg	Bahamas
39.	Voyageur L.L.C.	Voyageur Spirit	Bahamas
40.	Arendal Spirit L.L.C.	Arendal Spirit	Bahamas
41.	Petrojarl I L.L.C.	Petrojarl I	Bahamas
42.	ALP Winger B.V.	ALP Winger	Netherlands
43.	ALP Guard B.V.	ALP Guard	Netherlands
44.	ALP Centre B.V.	ALP Centre	Netherlands
45.	ALP Ippon B.V.	ALP Ippon	Netherlands
46.	Teekay Grand Banks Shipping AS	Beothuk Spirit	Canada
47.	Teekay Navion Offshore Loading Pte Ltd.	Norse Spirit	Canada
48.	Teekay Navion Offshore Loading Pte. Ltd.	Grena Knutsen ⁽¹⁾	Bahamas
49.	Teekay (Atlantic) Chartering ULC	Jasmine Knutsen ⁽¹⁾	Canada
50.	Teekay (Atlantic) Chartering ULC	Heather Knutsen ⁽¹⁾	Canada
51.	Teekay Grand Banks Shipping AS	EC Canada NB Hull 2186 ⁽²⁾	—
52.	SHI Hull No. 2241	E-Shuttle NB Hull 2241 ⁽²⁾	—
53.	SHI Hull No. 2242	E-Shuttle NB Hull 2242 ⁽²⁾	—
54.	SHI Hull No. 2256	E-Shuttle NB Hull 2256 ⁽²⁾	—
55.	SHI Hull No. 2257	E-Shuttle NB Hull 2257 ⁽²⁾	—
56.	Teekay Offshore Chartering L.L.C.	Blue Power ⁽¹⁾	Liberia
57.	Teekay Offshore Chartering L.L.C.	Blue Pride ⁽¹⁾	Liberia
58.	Knarr L.L.C.	Petrojarl Knarr	Bahamas
59.	ALP Ace B.V.	ALP Ace	Netherlands
60.	ALP Forward B.V.	ALP Forward	Netherlands
61.	ALP Striker B.V.	ALP Striker	Netherlands
62.	ALP Defender B.V.	ALP Defender	Netherlands
63.	ALP Sweeper B.V.	ALP Sweeper	Netherlands
64.	ALP Keeper B.V.	ALP Keeper	—

(1) In-chartered

(2) On order

SCHEDULE IV

1.	Final Term Sheet substantially in the form set forth in Schedule V.

SCHEDULE V

PRICING TERM SHEET

LOGO

8.8750% Series E Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred

Units

(Liquidation Preference $25.00 per Unit)

January 16, 2018

Issuer:

Teekay Offshore Partners L.P.

Securities Offered:

8.8750% Series E Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units (the “Series E Preferred Units”)

Number of Firm Units:

4,600,000 units

Number of Option Units:

690,000 units

Public Offering Price:

$25.00 per unit; $115,000,000 total (assuming no exercise of the option to purchase additional units)

Underwriting Discounts:

$0.7875 per unit; $3,622,500 total assuming no exercise of the option to purchase additional units)

Maturity Date:

Perpetual (unless redeemed by the Issuer on or after February 15, 2025)

Ratings:

The Series E Preferred Units will not be rated by any nationally recognized statistical rating organization

Trade Date:

January 16, 2018

Settlement Date:

January 23, 2018 ( T+5 )

Liquidation Preference:

$25.00, plus accrued and unpaid distributions

Distribution Rate:

From and including the original issue date to, but not including, February 15, 2025, the distribution rate for the Series E Preferred Units will be 8.8750% per annum per $25.00 of the liquidation preference per unit (equal to $2.21875 per unit per annum). From and including February 15, 2025, the distribution rate will be a floating rate equal to three-month LIBOR plus a spread of 640.7 basis points per annum per $25.00 of liquidation preference per unit.

Distribution Payment Dates:

Quarterly on each February 15, May 15, August 15 and November 15. The initial distribution on the Series E Preferred Units will be payable on May 15, 2018 in an amount equal to $0.69028 per unit.

Optional Redemption:

On or after February 15, 2025, the Issuer may, at its option, redeem the Series E Preferred Units, in whole or in part, at any time or from time to time, at a redemption price of $25.00 per unit plus an amount equal to all accumulated and unpaid distributions thereon to the date of redemption.

CUSIP/ISIN:

Y8565J 176 / MHY8565J1762

Joint Book-Running Managers:

Morgan Stanley & Co. LLC

UBS Securities LLC

J.P. Morgan Securities LLC

Stifel, Nicolaus & Company, Incorporated

Co-Managers:

Commonwealth Bank of Australia

ING Financial Markets LLC

Scotia Capital (USA) Inc.

Listing:

The Issuer intends to file an application to list the Series E Preferred Units on the New York Stock Exchange under the symbol “TOOPRE”. If the application is approved, trading of the Series E Preferred Units on the New York Stock Exchange is expected to commence within 30 days after their original issue date.

ADDITIONAL INFORMATION:

All information (including financial information) presented in the Preliminary Prospectus Supplement is deemed to have changed to the extent affected by the changes described herein.

This communication is intended for the sole use of the person to whom it is provided by us. This communication does not constitute an offer to sell the Series E Preferred Units and is not soliciting an offer to buy the Series E Preferred Units in any jurisdiction where the offer or sale is not permitted.

The issuer has filed a registration statement (including a prospectus supplement and a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus supplement and prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about the issuer and this offering. You may obtain these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, the issuer, any underwriter or any dealer participating in the offering will arrange to send you the prospectus supplement and prospectus if you request it by calling Morgan Stanley & Co. LLC at 1-866-718-1649, UBS Securities LLC at 1-888-827-7275, J.P. Morgan Securities LLC at 1-212-834-4533 or Stifel, Nicolaus & Company, Incorporated at 1-855-300-7136.

ANY DISCLAIMERS OR OTHER NOTICES THAT MAY APPEAR BELOW ARE NOT APPLICABLE TO THIS COMMUNICATION AND SHOULD BE DISREGARDED. SUCH DISCLAIMERS OR OTHER NOTICES WERE AUTOMATICALLY GENERATED AS A RESULT OF THIS COMMUNICATION BEING SENT VIA BLOOMBERG OR ANOTHER EMAIL SYSTEM.

ANNEX A

Each of the Partnership and the Operating Company has been duly formed and is validly existing in good standing as a limited partnership under Marshall Islands Law, and has the limited partnership power and authority to own or lease its properties and to conduct its business, in each case in all material respects, as described in the Registration Statement, the Disclosure Package and the Prospectus.

Each of the General Partner and OLP GP has been duly formed and is validly existing in good standing as a limited liability company under Marshall Islands Law, and each has the limited liability company power and authority to own or lease its properties and to conduct its business, in each case in all material respects, as described in the Registration Statement, the Disclosure Package and the Prospectus.

Each of the Marshall Islands Subsidiaries is validly existing in good standing as a limited liability company or corporation, as applicable, under Marshall Islands Law, and each has the limited liability company or corporate power, as applicable, and authority to own or lease its properties and to conduct its business, in each case in all material respects, as described in the Registration Statement, the Disclosure Package and the Prospectus.

All limited partnership and limited liability company action, as the case may be, required to be taken by the Teekay Parties or any of their respective partners or members pursuant to Marshall Islands Law, for the authorization, execution and delivery of the Underwriting Agreement and the Partnership Agreement, and the consummation of the transactions contemplated thereby, has been validly taken.

Each of the Teekay Parties has all requisite limited partnership or limited liability company, as applicable, power and authority to execute and deliver the Underwriting Agreement, and the Partnership Agreement to which it is party, and to perform its obligations thereunder and to consummate the transactions contemplated thereby, including the issuance, sale and delivery of the Preferred Units by the Partnership in accordance with and upon the terms and conditions set forth in the Underwriting Agreement and the Partnership Agreement.

6.	The Underwriting Agreement has been validly executed and delivered by each of the Teekay Parties party thereto.

The Partnership Agreement has been validly executed by the General Partner and constitutes a valid and legally binding obligation of the General Partner, enforceable against the General Partner in accordance with its terms, except that (i) the enforceability may be limited by applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally, and subject, as to enforceability, to general principles of equity, including principles of commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity), and (ii) rights to indemnification and contribution thereunder may be limited by securities laws or considerations of public policy relating thereto.

Assuming that each of Teekay Holdings and Brookfield, has taken all actions necessary to authorize its “acknowledgment and confirmation” of the Partnership Agreement and has validly executed the Partnership Agreement, the Partnership Agreement is enforceable (as defined in the Partnership Agreement) against Teekay Holdings and Brookfield in accordance with its terms, except that (i) the enforceability thereof may be limited by applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws relating to or affecting creditors’ rights generally and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law), and (ii) the indemnity, contribution and exoneration provisions contained in such agreement may be limited by applicable laws and public policy.

The execution, delivery and performance of the Underwriting Agreement and the Partnership Agreement and the consummation of the transactions contemplated thereby, including the offering, issuance and sale by the Partnership of the Preferred Units in accordance with and upon the terms and conditions set forth in the Underwriting Agreement, do not and will not (i) conflict with or constitute a violation of the organizational documents of any of the Teekay Parties, OLP GP, the Operating Company or the Marshall Islands Subsidiaries, (ii) conflict with or constitute a breach or violation of, or a default under (or an event which, with notice or lapse of time or both, would constitute such a default), the Teekay Offshore Partners L.P. 2006 Long-Term Incentive Plan, (iii) violate Marshall Islands Law, or (iv) violate any judgment, order or decree of which we are aware of any court, regulatory body, administrative agency, governmental body, arbitrator or other authority situated in the Republic of the Marshall Islands directed to any of the Teekay Parties, OLP GP, the Operating Company or the Marshall Islands Subsidiaries in a proceeding before such court, regulatory body, administrative agency, governmental body, arbitrator or other authority in the Republic of the Marshall Islands to which any of them is a party.

10.

No permit, consent, approval, authorization, order, registration, filing or qualification of or with any court, governmental agency or body of the Republic of the Marshall Islands having jurisdiction over the Teekay Parties, OLP GP, the Operating Company, any of the Marshall Islands Subsidiaries or any of their respective properties is required in connection with the execution and delivery of the Underwriting Agreement or the Partnership Agreement by the Teekay Parties party thereto, the performance of the transactions contemplated thereby by the Teekay Parties or the performance by the Teekay Parties of their obligations thereunder, including the offering, issuance and sale by the Partnership of the Preferred Units in accordance with and upon the terms and conditions set forth in the Underwriting Agreement and the Partnership Agreement.

11.

The Preferred Units to be issued pursuant to the Underwriting Agreement and the limited partner interests represented thereby have been duly authorized in accordance with the Partnership Agreement and, when issued and delivered to the Underwriters against payment therefor in accordance with the terms of the Underwriting Agreement, will be

validly issued, fully paid (to the extent required under the Partnership Agreement) and nonassessable (except as such nonassessability may be affected by Sections 30, 41, 51 and 60 of the Marshall Islands Limited Partnership Act and except as may otherwise be provided in the Partnership Agreement). The form of certificate representing the Preferred Units attached as Exhibit D to the Partnership Agreement does not violate Marshall Islands Law.

12.

The General Partner owns of record a 0.76% general partner interest (excluding preferred units) in the Partnership and is the sole general partner of the Partnership. Such general partner interest has been duly authorized and validly issued in accordance with the Partnership Agreement. To our knowledge, the General Partner beneficially owns such general partner interest free and clear of all pledges, liens, encumbrances, security interests or other claims, except for the Claims Exceptions. The term “Claim Exceptions” with respect to any limited liability company membership interest, shareholding interest, limited partnership interest or other interest as used herein shall mean: (i) pledges, liens, encumbrances, security interests or other claims as described in, referred to (including by incorporation by reference) or disclosed in the Registration Statement, Disclosure Package, or Prospectus, (ii) any liens pursuant to credit agreements, security agreements or financing documents described in, referred to (including by incorporation by reference) or disclosed in the Registration Statement, Disclosure Package, or Prospectus, and (iii) restrictions on transferability contained in the relevant organizational documents or under applicable securities laws, as applicable.

13.

Teekay Holdings owns of record 51% of the membership interests in the General Partner. Brookfield owns of record 49% of the membership interests in the General Partner. Such membership interests have been duly authorized and validly issued in accordance with the limited liability company agreement of the General Partner, and are fully paid (to the extent required under the General Partner’s limited liability company agreement) and nonassessable (except as such nonassessability may be affected by Sections 20, 31, 40 and 49 of the Marshall Islands Limited Liability Company Act of 1996 and except as may be provided in the General Partner limited liability company agreement). For the avoidance of doubt, Brookfield has an option to acquire an additional 2% of the membership interests in the General Partner.

14.

The General Partner owns of record 100% of the Incentive Distribution Rights (as defined in the Partnership Agreement) of the Partnership. To our knowledge, the General Partner beneficially owns such Incentive Distribution Rights free and clear of all pledges, liens, encumbrances, security interests or other claims, except for the Claim Exceptions. As of the date hereof, 38,211,772 common units of the Partnership are owned by Teekay Finance Limited, a Bermuda company (“Teekay Finance”), through brokerage accounts, 16,560,066 are owned of record by Teekay Shipping Limited, a Bermuda company, and 1,815,646 common units of the Partnership are owned of record by Teekay Holdings. These common units of the Partnership and the Incentive Distribution Rights of the Partnership have been duly authorized and validly issued in accordance with the Partnership Agreement, and are fully paid (to the extent required under the Partnership Agreement) and nonassessable (except as such nonassessability may be affected by

Sections 30, 41, 51 and 60 of the Marshall Islands Limited Partnership Act and except as may otherwise be provided in the Partnership Agreement).

15.

ShuttleCo, owns of record a 99.09% limited partnership interest the Operating Company. OLP GP owns of record a 0.91% general partnership interest in the Operating Company. All such partnership interests have been duly authorized and validly issued in accordance with the partnership agreement of the Operating Company, as amended or restated prior to the date hereof, and are fully paid (to the extent required under such partnership agreement) and, with respect to the limited partner interests, are nonassessable (except as such nonassessability may be affected by Sections 30, 41, 51 and 60 of the Marshall Islands Limited Partnership Act and except as may otherwise be provided in the partnership agreement of the Operating Company). To our knowledge, ShuttleCo and OLP GP beneficially own such partnership interest free and clear of all pledges, liens, encumbrances, security interests or other claims, except for the Claim Exceptions.

16.

Listed in the “Owner” column of Schedule 1 is the owner of record of the stock or membership interests, as applicable, of each of the Marshall Islands Subsidiaries. The stock or membership interests, as applicable, of the entities listed in the “Marshall Islands Subsidiary” column of Schedule 1 have been duly authorized and validly issued in accordance with the organizational documents of each such Marshall Islands Subsidiary, as amended or restated prior to the date hereof, and are fully paid (to the extent required under the organizational documents of each Marshall Islands Subsidiary) and nonassessable (except as such nonassessability may be affected by applicable Marshall Islands Law and except as may otherwise be provided in the applicable organizational documents). To our knowledge, each Marshall Islands entity in the “Owner” column of Schedule 1 hereto beneficially owns the stock or membership interests, as applicable, of each of the entities in the “Marshall Islands Subsidiary” column of Schedule 1 hereto, free and clear of all pledges, liens, encumbrances, security interests or other claims, except for Claim Exceptions.

17.

Except as described in the Registration Statement, the Disclosure Package or the Prospectus (including in any document or filing incorporated by reference therein), or as otherwise set forth in the Partnership Agreement or the General Partner’s Second Amended and Restated Limited Liability Company Agreement dated September 25, 2017, there are no preemptive rights or other rights to subscribe for or to purchase, nor any restriction upon the voting or transfer of, (i) any limited partner interests in the Partnership or the Operating Company, (ii) any membership interests in the General Partner or OLP GP, or (iii) any equity interests in any Marshall Islands Subsidiary (except as provided in Section 78 of the Business Corporations Act of the Republic of the Marshall Islands), in each case pursuant to the limited partnership agreement or limited liability company agreement or articles of incorporation or bylaws of such entity.

18.

To our knowledge, no permits, consents, licenses, franchises, concessions, certificates and authorizations of, or declarations or filings with, any governmental or regulatory authorities of the Republic of the Marshall Islands are required for any of the Teekay Parties, OLP GP, the Operating Company or the Marshall Islands Subsidiaries to own or lease its properties and to conduct its business in the manner described in the Registration

Statement, the Disclosure Package and the Prospectus, other than such permits, consents, licenses, franchises, concessions, certificates and authorizations, declarations or filings with any Republic of the Marshall Islands governmental authority (i) currently held or previously obtained, applied, received or filed by any of the Teekay Parties, OLP GP, the Operating Company or the Marshall Islands Subsidiaries or (ii) necessary for the ownership, chartering, management or operation of Marshall Islands flagged vessels or rigs.

19.

The statements (i) in the Partnership’s Form 20-F for the year ended December 31, 2016 under the captions “Item 4. Information on the Partnership—E. Taxation of the Partnership—Marshall Islands Taxation” and “Item 10. Additional Information—Non-United States Tax Consequences—Marshall Islands Tax Consequences” and (ii) in the Disclosure Package and the Prospectus under the captions “Non-United States Tax Considerations—Republic of the Marshall Islands Tax Considerations” and “Service of Process and Enforcement of Civil Liabilities,” insofar as they purport to constitute summaries of Marshall Islands Law or legal conclusions of Marshall Islands Law, fairly describe in all material respects the portions of the statutes and regulations addressed thereby, subject to the qualifications and assumptions stated therein.

20.	The choice of New York law to govern the Underwriting Agreement constitutes a valid choice of law under Marshall Islands Law.

21.	The submission by the Partnership in the Underwriting Agreement to the exclusive jurisdiction of any New York court is a valid submission under Marshall Islands Law.

22.

A judgment granted by a foreign court against the Partnership may be recognized in the Republic of the Marshall Islands, to the extent that the foreign judgment grants or denies recovery of a sum of money, other than a judgment for taxes, a fine or other penalty, or a judgment for support in matrimonial matters, and so long as the judgment is final and conclusive and enforceable where rendered even though an appeal therefrom is pending, or subject to appeal (although the court may stay in proceedings until the relevant appeal has been determined or until the expiration of a period of time sufficient to enable the defendant to prosecute the appeal). A foreign judgment is not conclusive if: (i) the judgment was rendered under a system which does not provide impartial tribunals or procedures compatible with the requirements of due process of law, (ii) the foreign court did not have personal jurisdiction over the defendant, (iii) the foreign court did not have jurisdiction over the subject matter, or (iv) the foreign court does not recognize or enforce the judgments of any other foreign nation. A foreign judgment need not be recognized if: (i) the defendant in the proceedings in the foreign court did not receive notice of the proceedings in sufficient time to enable him to defend, (ii) the judgment was obtained by fraud, (iii) the cause of action on which the judgment is based is repugnant to the public policy of the Republic of the Marshall Islands, (iv) the judgment conflicts with another final and conclusive judgment, (v) the proceeding in the foreign court was contrary to an agreement between the parties under which the dispute in question was to be settled otherwise than by proceedings in the court, or (vi) in the case of jurisdiction based only on personal service, the foreign court was a seriously inconvenient forum for the trial of the action.

ANNEX B-1

The statements, with respect to legal matters or legal conclusions, in (a) the Disclosure Package and the Prospectus under the caption “Material United States Federal Income Tax Considerations” and (b) the Partnership’s Form 20-F for the year ended December 31, 2016 (the “ Form 20-F ”) under the caption “Item 4. Information on the Partnership—Taxation of the Partnership—United States Taxation” are, in all material respects, an accurate discussion of the material U.S. federal income tax considerations addressed therein. (We do not opine or comment on the representations and statements of fact of the Partnership included in such discussion.)

2.	Our opinion filed as Exhibit 8.1 to the Partnership’s Report on Form 6-K furnished to the Commission on January 23, 2018 and incorporated by reference into the Registration Statement is confirmed and the Underwriters may rely upon such opinion as if it were addressed to them.

To our knowledge and except as described in the Registration Statement, the Disclosure Package and the Prospectus, there are no outstanding options or warrants to purchase (a) any Common Units, Series A Preferred Units, Series B Preferred Units, Series E Preferred Units, Incentive Distribution Rights or other interests in the Partnership, or (b) any equity interests in the General Partner, Teekay Offshore Holdings, ShuttleCo, the Operating Company or the Operating Subsidiaries.

To our knowledge, there are no contracts, agreements or understandings between any of the Teekay Entities and any person granting such person the right to require any of the Teekay Entities to file a registration statement under the Act with respect to any securities of any of the Teekay Entities owned or to be owned by such person or to require any of the Teekay Entities to include such securities in the securities registered pursuant to the Registration Statement or in any securities being registered pursuant to any other registration statement filed by any Teekay Entity under the Act, except for any such rights that have been waived or do not apply with respect to the Offering.

The statements (a) in the Disclosure Package and the Prospectus under the captions “Description of Series E Preferred Units” and “The Partnership Agreement” and (b) in subsection b) in the Form 20-F under the caption “Item 7. Major Unitholders and Related Party Transactions – Certain Relationships and Related Party Transactions,” insofar as they constitute descriptions of agreements, fairly describe in all material respects the portions of the agreements addressed thereby, and the Series E Preferred Units conform in all material respects to the descriptions thereof contained in the Disclosure Package and the Prospectus under the captions “Description of Series E Preferred Units” and “The Partnership Agreement.”

The Registration Statement was declared effective by the Commission under the Act on January 10, 2018; the Preliminary Prospectus, each Issuer Free Writing Prospectus and the Prospectus have been filed with the Commission pursuant to Rule 424(b) and Rule 433, as applicable, under the Act, in a manner and within the time period required by the

1933 Act Regulations; and, to our knowledge, no stop order suspending the effectiveness of the Registration Statement has been issued under the Act and no proceeding for that purpose has been instituted or is pending or threatened by the Commission.

Without independent verification of the factual accuracy, completeness or fairness of any statements made in the Registration Statement or the Prospectus, each of the Registration Statement, on the Effective Date, the Disclosure Package, as of the Applicable Time, and the Prospectus, when filed with the Commission pursuant to Rule 424(b) under the Act and on the date hereof (except for the financial statements and financial schedules, and other financial and statistical information included therein, as to which we express no opinion) appears on its face to be appropriately responsive in all material respects to the requirements of the Act and the applicable rules and regulations of the Commission thereunder.

The Partnership’s offering, issuance and sale of the of the Series E Preferred Units, and the Partnership’s and the General Partner’s execution, delivery and performance of the Underwriting Agreement, and consummation of the transactions contemplated by the Underwriting Agreement do not (a) violate statutory or regulatory U.S. federal laws or statutory or regulatory laws of the State of New York that counsel exercising customary professional judgment would in our experience reasonably recognize as typically applicable to agreements similar to the Underwriting Agreement and transactions similar to the transactions contemplated by the Underwriting Agreement, or (b) conflict with or constitute a breach or violation of, or a default under (or an event which, with notice or lapse of time or both, would constitute such a default), any Material Agreement. (We do not comment or opine as to compliance with any financial covenants or financial ratios contained in any such documents.) “Material Agreement” means any indenture, contract, mortgage, deed of trust, note agreement, loan agreement, lease or other agreement or instrument filed by the Partnership as an exhibit to the Registration Statement (including any document filed as an exhibit to any document incorporated by reference into the Registration Statement).

Without independent verification of the factual accuracy, completeness or fairness of the documents incorporated by reference in the Registration Statement and the Prospectus or any further amendment or supplement thereto made by the Partnership prior to the date hereof (other than exhibits thereto and the financial statements and financial schedules, and other financial and statistical information included therein, as to which we express no opinion), when they became effective or were filed with the Commission, as the case may be, each of such documents appears on its face to be appropriately responsive in all material respects to the applicable requirements of the Exchange Act and the applicable rules and regulations of the Commission thereunder.

10.

To our knowledge, (a) there is no pending or threatened action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving any Teekay Entity or its property of a character required to be disclosed in the Registration Statement, the Disclosure Package or the Prospectus that is not disclosed in the Registration Statement, the Disclosure Package or the Prospectus as required and

(b) there is no agreement, franchise, contract, indenture, lease or other document or instrument of a character that is required to be described in the Registration Statement, the Disclosure Package or the Prospectus by the Act or to be filed by the Act as an exhibit to the Registration Statement that is not described or filed as required.

11.

All consents, approvals, authorizations or other orders of, or registrations or filings on the part of the Partnership, the General Partner, Brookfield or Teekay Holdings with any United States federal or New York governmental or regulatory authority required for the issuance of the Series E Preferred Units, the execution and delivery by the Partnership and the General Partner of the Underwriting Agreement, the execution and delivery by the General Partner, Brookfield and Teekay Holdings of the Restated Partnership Agreement, and the consummation of the transactions contemplated by the Underwriting Agreement have been made or obtained.

12.

The Partnership is not, and immediately upon giving effect to the Offering, the sale of the Series E Preferred Units and the application of the proceeds thereof as described under “Use of Proceeds” in the Prospectus, will not be, required to register as an “investment company” under the Investment Company Act of 1940, as amended.

13.	The form of the certificate representing the Series E Preferred Units (i) complies with the requirements of the Restated Partnership Agreement and (ii) complies in all material respects with the requirements and rules of the NYSE.

ANNEX B-2

We have participated in conferences with officers and other representatives of the Partnership, representatives of the Underwriters and representatives of the independent auditors of the Partnership at which the contents of the Registration Statement, the Disclosure Package and the Prospectus were discussed. Although we assume no responsibility for the factual accuracy, completeness or fairness of any statements (other than as set forth in paragraphs 1, 2 and 5 of Annex B-1, which remain subject to the assumptions, exclusions and qualifications set forth in this opinion) made in (a) the Registration Statement, (b) the Prospectus, or (c) the documents incorporated by reference in the Registration Statement, nothing has come to our attention that causes us to believe that:

(a) the Registration Statement or the base prospectus included therein (except for the financial statements and financial schedules and other financial information included therein, as to which we make no statement), as of the Effective Date, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading,

(b) the Disclosure Package (except for the financial statements and financial schedules and other financial information included therein, as to which we make no statement), as of the Applicable Time, contained an untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; or

(c) the Prospectus (except for the financial statements and financial schedules and other financial information included therein, as to which we make no statement), as of its date or as of the date hereof, contained or contains any untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

Exhibit 4.1

EXECUTION COPY

SIXTH AMENDED AND RESTATED

AGREEMENT OF LIMITED PARTNERSHIP

TEEKAY OFFSHORE PARTNERS L.P.

TABLE OF CONTENTS


		Page
ARTICLE I DEFINITIONS			1

Section 1.1	Definitions		1

Section 1.2	Construction		21

ARTICLE II ORGANIZATION			22

Section 2.1	Formation		22

Section 2.2	Name		22

Section 2.3	Registered Office; Registered Agent; Principal Office; Other Offices		22

Section 2.4	Purpose and Business		22

Section 2.5	Powers		23

Section 2.6	Power of Attorney		23

Section 2.7	Term		24

Section 2.8	Title to Partnership Assets		24

ARTICLE III RIGHTS OF LIMITED PARTNERS			25

Section 3.1	Limitation of Liability		25

Section 3.2	Management of Business		25

Section 3.3	Outside Activities of the Limited Partners		25

Section 3.4	Rights of Limited Partners		26

ARTICLE IV CERTIFICATES; RECORD HOLDERS; TRANSFER OF PARTNERSHIP INTERESTS			26

Section 4.1	Certificates		26

Section 4.2	Mutilated, Destroyed, Lost or Stolen Certificates		27

Section 4.3	Record Holders		28

Section 4.4	Transfer Generally		28

Section 4.5	Registration and Transfer of Limited Partner Interests		28

Section 4.6	Transfer of the General Partner’s General Partner Interest		29

Section 4.7	Transfer of Incentive Distribution Rights		29

Section 4.8	Restrictions on Transfers		30

ARTICLE V CAPITAL CONTRIBUTIONS AND ISSUANCE OF PARTNERSHIP INTERESTS			30

Section 5.1	Organizational Contributions		30

Section 5.2	Initial Unit Issuances; General Partner Pre-emptive Rights		30

TABLE OF CONTENTS


		Page
Section 5.3	Contributions by Initial Limited Partners and Distributions to the General Partner and its Affiliates		31

Section 5.4	Interest and Withdrawal		32

Section 5.5	Issuances of Additional Partnership Securities		32

Section 5.6	Limitations on Issuance of Additional Partnership Securities		33

Section 5.7	Limited Preemptive Right		33

Section 5.8	Splits and Combinations		33

Section 5.9	Fully Paid and Non-Assessable Nature of Limited Partner Interests		34

ARTICLE VI ALLOCATIONS AND DISTRIBUTIONS			34

Section 6.1	Allocations		34

Section 6.2	Requirement and Characterization of Distributions; Distributions to Record Holders		35

Section 6.3	Distributions of Available Cash from Operating Surplus		35

Section 6.4	Distributions of Available Cash from Capital Surplus		36

Section 6.5	Adjustment of Minimum Quarterly Distribution and Target Distribution Levels		37

Section 6.6	Special Provisions Relating to the Holders of Incentive Distribution Rights		37

ARTICLE VII MANAGEMENT AND OPERATION OF BUSINESS			37

Section 7.1	Management		37

Section 7.2	Certificate of Limited Partnership		39

Section 7.3	Restrictions on the General Partner’s Authority		40

Section 7.4	Reimbursement of the General Partner		40

Section 7.5	Outside Activities		41

Section 7.6	Loans from the General Partner; Loans or Contributions from the Partnership or Group Members		42

Section 7.7	Indemnification		43

Section 7.8	Liability of Indemnitees		45

Section 7.9	Resolution of Conflicts of Interest; Standards of Conduct and Modification of Duties		45

Section 7.10	Other Matters Concerning the General Partner		47

Section 7.11	Purchase or Sale of Partnership Securities		48

Section 7.12	Registration Rights of the General Partner and its Affiliates		48

Section 7.13	Reliance by Third Parties		50

-ii-

TABLE OF CONTENTS


		Page
ARTICLE VIII BOOKS, RECORDS, ACCOUNTING AND REPORTS			51

Section 8.1	Records and Accounting		51

Section 8.2	Fiscal Year		51

Section 8.3	Reports		51

ARTICLE IX TAX MATTERS			52

Section 9.1	Tax Elections and Information		52

Section 9.2	Withholding		52

Section 9.3	Conduct of Operations		52

ARTICLE X ADMISSION OF PARTNERS			52

Section 10.1	Admission of Initial Limited Partners		52

Section 10.2	Admission of Additional Limited Partners		53

Section 10.3	Admission of Successor General Partner		53

Section 10.4	Amendment of Agreement and Certificate of Limited Partnership		54

ARTICLE XI WITHDRAWAL OR REMOVAL OF PARTNERS			54

Section 11.1	Withdrawal of the General Partner		54

Section 11.2	Removal of the General Partner		55

Section 11.3	Interest of Departing General Partner and Successor General Partner		56

Section 11.4	Withdrawal of Limited Partners		57

ARTICLE XII DISSOLUTION AND LIQUIDATION			57

Section 12.1	Dissolution		57

Section 12.2	Continuation of the Business of the Partnership After Dissolution		58

Section 12.3	Liquidator		58

Section 12.4	Liquidation		59

Section 12.5	Cancellation of Certificate of Limited Partnership		60

Section 12.6	Return of Contributions		61

Section 12.7	Waiver of Partition		61

ARTICLE XIII AMENDMENT OF PARTNERSHIP AGREEMENT; MEETINGS; RECORD DATE			61

Section 13.1	Amendments to be Adopted Solely by the General Partner		61

Section 13.2	Amendment Procedures		62

Section 13.3	Amendment Requirements		63

Section 13.4	Special Meetings		63

Section 13.5	Notice of a Meeting		64

Section 13.6	Record Date		64

Section 13.7	Adjournment		64

Section 13.8	Waiver of Notice; Approval of Meeting; Approval of Minutes		65

-iii-

TABLE OF CONTENTS


		Page
Section 13.9	Quorum and Voting		65

Section 13.10	Conduct of a Meeting		65

Section 13.11	Action Without a Meeting		66

Section 13.12	Right to Vote and Related Matters		66

ARTICLE XIV MERGER			67

Section 14.1	Authority		67

Section 14.2	Procedure for Merger or Consolidation		67

Section 14.3	Approval by Limited Partners of Merger or Consolidation		68

Section 14.4	Certificate of Merger		69

Section 14.5	Amendment of Partnership Agreement		69

Section 14.6	Effect of Merger		69

ARTICLE XV RIGHT TO ACQUIRE LIMITED PARTNER INTERESTS			70

Section 15.1	Right to Acquire Limited Partner Interests		70

ARTICLE XVI SERIES A, SERIES B AND SERIES E CUMULATIVE REDEEMABLE PREFERRED UNITS			71

Section 16.1	Designations		71

Section 16.2	Units		72

Section 16.3	Distributions		72

Section 16.4	Liquidation Rights		75

Section 16.5	Voting Rights		76

Section 16.6	Optional Redemption		78

Section 16.7	Rank		81

Section 16.8	No Sinking Fund		82

Section 16.9	Record Holders		82

Section 16.10	Notices		82

Section 16.11	Other Rights; Fiduciary Duties		82

ARTICLE XVII GENERAL PROVISIONS			83

Section 17.1	Addresses and Notices		83

Section 17.2	Further Action		83

Section 17.3	Binding Effect		83

Section 17.4	Integration		84

Section 17.5	Creditors		84

Section 17.6	Waiver		84

Section 17.7	Counterparts		84

-iv-

TABLE OF CONTENTS


		Page
Section 17.8	Applicable Law		84

Section 17.9	Invalidity of Provisions		84

Section 17.10	Consent of Partners		84

Section 17.11	Facsimile Signatures		85

Section 17.12	Third-Party Beneficiaries		85

-v-

SIXTH AMENDED AND RESTATED AGREEMENT OF LIMITED

PARTNERSHIP OF TEEKAY OFFSHORE PARTNERS L.P.

THIS SIXTH AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF TEEKAY OFFSHORE PARTNERS L.P., dated as of January 23, 2018, is entered into by and between Teekay Offshore GP L.L.C., a Marshall Islands limited liability company, as the General Partner, and, solely with respect to Section 16.5(b), Teekay Holdings Limited, a Bermuda company, and Brookfield TK TOGP L.P., a Bermuda limited partnership, together with any other Persons who become Partners in the Partnership or parties hereto as provided herein. In consideration of the covenants, conditions and agreements contained herein, the parties agree as follows:

ARTICLE I

DEFINITIONS

Section 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.

“Acquisition” means any transaction in which any Group Member acquires (through an asset acquisition, merger, stock acquisition or other form of investment) control over all or a portion of the assets, properties or business of another Person for the purpose of increasing the operating capacity or asset base of the Partnership Group from the operating capacity or asset base of the Partnership Group existing immediately prior to such transaction; provided , however , that any acquisition of properties or assets of another Person that is made solely for investment purposes shall not constitute an Acquisition under this Agreement.

“Adjusted Operating Surplus” means, with respect to any period, Operating Surplus generated with respect to such period (a) less (i) any net increase in Working Capital Borrowings (or the Partnership’s proportionate share of any net increase in Working Capital Borrowings in the case of Subsidiaries that are not wholly owned) with respect to such period and (ii) any net decrease in cash reserves for Operating Expenditures with respect to such period to the extent such reduction does not relate to an Operating Expenditure made with respect to such period, and (b) plus (i) any net decrease in Working Capital Borrowings (or the Partnership’s proportionate share of any net decrease in Working Capital Borrowings in the case of Subsidiaries that are not wholly owned) with respect to such period, and (ii) any net increase in cash reserves (or the Partnership’s proportionate share of any net increase in cash reserves in the case of Subsidiaries that are not wholly owned) for Operating Expenditures with respect to such period to the extent such reserve is required (A) by any debt instrument for the repayment of principal, interest or premium or (B) for any Preferred Unit Payments. Adjusted Operating Surplus does not include that portion of Operating Surplus included in clause (a)(i) of the definition of Operating Surplus.

“Affiliate” means, with respect to any Person, any other Person that directly or indirectly through one or more intermediaries controls, is controlled by or is under common control with, 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.

- 1 -

“Agreed Value” means the fair market value of the applicable property or other consideration at the time of contribution or distribution, as the case may be, as determined by the General Partner.

“Agreement” means this Sixth Amended and Restated Agreement of Limited Partnership of Teekay Offshore Partners L.P., as it may be amended, supplemented or restated from time to time.

“Arrears” means, with respect to Preferred Unit Distributions for a particular series of Preferred Units for any quarter period, that the full cumulative Preferred Unit Distributions for such series of Preferred Units through the most recent Preferred Unit Distribution Payment Date for such series of Preferred Units have not been paid on all Outstanding Preferred Units of such series.

“Associate” means, when used to indicate a relationship with any Person: (a) any corporation or organization of which such Person is a director, officer, manager or partner or is, directly or indirectly, the owner of 20% or more of any class of voting stock or other voting interest; (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, who has the same principal residence as such Person.

“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 Group (or the Partnership’s proportionate share of cash and cash equivalents in the case of Subsidiaries that are not wholly owned) on hand at the end of such Quarter, and (ii) all additional cash and cash equivalents of the Partnership Group (or the Partnership’s proportionate share of cash and cash equivalents in the case of Subsidiaries that are not wholly owned) on hand on the date of determination of Available Cash with respect to such Quarter resulting from Working Capital Borrowings made subsequent to the end of such Quarter, less

(b) the amount of any cash reserves (or the Partnership’s proportionate share of cash reserves in the case of Subsidiaries that are not wholly owned) established by 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 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, (iii) provide funds for Preferred Unit Payments or (iv) provide funds for distributions under Section 6.3 or Section 6.4 in respect of any one or more of the next four Quarters; provided , however , that the General Partner may not establish cash

- 2 -

reserves pursuant to (iv) above if the effect of establishing such reserves would be that the Partnership is unable to distribute the Minimum Quarterly Distribution on all Common Units with respect to such Quarter; and, provided further , that disbursements made by a 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.

“Board of Directors” means the board of directors or managers of a corporation or limited liability company, as applicable, or if a limited partnership, the board of directors or board of managers of the general partner of such limited partnership.

“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 State of New York shall not be regarded as a Business Day.

“ Calculation Agent ” means a calculation agent appointed by the General Partner prior to the commencement of the Series E Floating Rate Period. If the General Partner is unable to obtain a third-party to serve as calculation agent, the calculation agent may be the General Partner or an Affiliate of the General Partner.

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

“Capital Improvement” means any (a) addition or improvement to the capital assets owned by any Group Member or (b) acquisition or conversion of existing, or the construction of new, capital assets (including shuttle tankers, floating storage and offtake units, floating production, storage and offloading units, crude oil tankers and related assets), in each case if such addition, improvement, acquisition, conversion or construction is made to increase the operating capacity or asset base of the Partnership Group from the operating capacity or asset base of the Partnership Group existing immediately prior to such addition, improvement, acquisition, conversion or construction.

“Capital Surplus” has the meaning assigned to such term in Section 6.2(a).

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

“Certificate” means a certificate (i) substantially in the form of Exhibit A with respect to Common Units, Exhibit B with respect to Series A Preferred Units, Exhibit C with respect to Series B Preferred Units or Exhibit D with respect to Series E Preferred Units, to this Agreement, (ii) issued in global or book entry form in accordance with the rules and regulations of the Depository or (iii) in such other form as may be adopted by the General Partner, issued by the

- 3 -

Partnership evidencing ownership of one or more Common Units or Preferred Units, or a certificate, in such form as may be adopted by the General Partner, issued by the Partnership evidencing ownership of one or more other Partnership Securities.

“Certificate of Limited Partnership” means the Certificate of Limited Partnership of the Partnership filed with the Marshall Islands Registrar as referenced in Section 7.2 as such Certificate of Limited Partnership may be amended, supplemented or restated from time to time.

“claim” (as used in Section 7.12(c)) has the meaning assigned to such term in Section 7.12(c).

“Closing Date” means the first date on which Common Units are sold by the Partnership to the Underwriters pursuant to the provisions of the Underwriting Agreement.

“Closing Price” means, in respect of any class or series of Limited Partner Interests, as of the date of determination, 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, as reported in the principal consolidated transaction reporting system with respect to securities listed on the principal National Securities Exchange on which the respective Limited Partner Interests are listed or admitted to trading or, if such Limited Partner Interests are not listed or admitted to trading on any National Securities Exchange, 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 any quotation system then in use with respect to such Limited Partner Interests, or, if on any such day such Limited Partner Interests of such class or series are not quoted by any such system, 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 or series 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 or series, the fair value of such Limited Partner Interests on such day as determined by the General Partner.

“Code” means the United States 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 any successor law.

“Combined Interest” has the meaning assigned to such term in Section 11.3(a).

“Commences Commercial Service” and “Commenced Commercial Service” shall mean the date a Capital Improvement is first put into service by a Group Member following, if applicable, completion of conversion or construction and testing.

“Commission” means the United States Securities and Exchange Commission.

“Common Unit” means a Partnership Security having the rights and obligations specified with respect to Common Units in this Agreement.

“Conflicts Committee” means a committee of the Board of Directors of the General Partner composed entirely of two or more directors who are not (a) security holders, officers or employees of the General Partner, (b) officers, directors or employees of any Affiliate of the

- 4 -

General Partner or (c) holders of any ownership interest in the Partnership Group other than Common Units and who also meet the independence standards required of directors who serve on an audit committee of a board of directors established by the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission thereunder and by the National Securities Exchange on which the Common Units are listed or admitted to trading.

“Contributed Property” means each property or other asset, in such form as may be permitted by the Marshall Islands Act, but excluding cash, contributed to the Partnership.

“Contribution Agreement” means that certain Contribution, Conveyance and Assumption Agreement, dated as of the Closing Date, among the General Partner, the Partnership, the Operating Company, Teekay Corporation and the other parties named therein, together with the additional conveyance documents and instruments contemplated or referenced thereunder.

“Current Market Price” means, in respect of any class or series of Limited Partner Interests, as of the date of determination, the average of the daily Closing Prices per Limited Partner Interest of such class or series for the 20 consecutive Trading Days immediately prior to such date.

“Departing General 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.

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

“Estimated Maintenance Capital Expenditures” means an estimate made in good faith by the Board of Directors of the General Partner (with the concurrence of the Conflicts Committee) of the average quarterly Maintenance Capital Expenditures that the Partnership will need to incur to maintain the operating capacity or asset base of the Partnership Group (including the Partnership’s proportionate share of the average quarterly Maintenance Capital Expenditures of its Subsidiaries that are not wholly owned), existing at the time the estimate is made. The Board of Directors of the General Partner (with the concurrence of the Conflicts Committee) will be permitted to make such estimate in any manner it determines reasonable. The estimate will be made at least annually and whenever an event occurs that is likely to result in a material adjustment to the amount of Maintenance Capital Expenditures on a long-term basis. The Partnership shall disclose to its Partners any change in the amount of Estimated Maintenance Capital Expenditures in its reports made in accordance with Section 8.3 to the extent not previously disclosed. Any adjustments to Estimated Maintenance Capital Expenditures shall be prospective only.

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

“Expansion Capital Expenditures” means cash expenditures for Acquisitions or Capital Improvements. Expansion Capital Expenditures shall not include Maintenance Capital Expenditures. Expansion Capital Expenditures shall include interest (and related fees) on debt incurred and distributions on equity incurred, in each case, to finance the conversion or construction of a Capital Improvement and paid during the period beginning on the date that the

- 5 -

Partnership enters into a binding obligation to commence conversion or construction of the Capital Improvement and ending on the earlier to occur of the date that such Capital Improvement Commences Commercial Service or the date that such Capital Improvement is abandoned or disposed of. Debt incurred or equity issued to fund any such conversion or construction period interest payments, or such conversion or construction period distributions on equity paid during such period, shall also be deemed to be debt or equity, as the case may be, incurred to finance the conversion or construction of a Capital Improvement.

“First Target Distribution” means $0.4025 per Common Unit per Quarter, subject to adjustment in accordance with Section 6.5.

“General Partner” means Teekay Offshore GP L.L.C., a Marshall Islands limited liability company, and its successors and permitted assigns that are admitted to the Partnership as general partner of the Partnership, in its capacity as general partner of the Partnership (except as the context otherwise requires).

“General Partner Interest” means the ownership interest of the General Partner in the Partnership (in its capacity as a general partner and without reference to any Limited Partner Interest held by it) which is evidenced by General Partner Units, and includes any and all benefits to which the General Partner is entitled as provided in this Agreement, together with all obligations of the General Partner to comply with the terms and provisions of this Agreement.

“General Partner Unit” means a fractional part of the General Partner Interest having the rights and obligations specified with respect to the General Partner Interest. A General Partner Unit is not a Unit.

“Group” means a Person that with or through any of its Affiliates or Associates has any agreement, arrangement, understanding or relationship for the purpose of acquiring, holding, voting (except voting pursuant to a revocable proxy or consent given to such Person in response to a proxy or consent solicitation made to 10 or more Persons) or disposing of any Partnership Securities with any other Person that beneficially owns, or whose Affiliates or Associates beneficially own, directly or indirectly, Partnership Securities.

“Group Member” means a member of the Partnership Group.

“Group Member Agreement” means the partnership agreement of any Group Member, other than the Partnership, that is a limited or general partnership, the limited liability company agreement of any Group Member that is a limited liability company, the certificate of incorporation and bylaws (or similar organizational documents) of any Group Member that is a corporation, the joint venture agreement or similar governing document of any Group Member that is a joint venture and the governing or organizational or similar documents of any other Group Member that is a Person other than a limited or general partnership, limited liability company, corporation or joint venture, in each case as such may be amended, supplemented or restated from time to time.

“Holder” as used in Section 7.12, has the meaning assigned to such term in Section 7.12(a).

- 6 -

“Incentive Distribution Right” means a non-voting Limited Partner Interest issued to the General Partner, which Partnership Interest will confer upon the holder thereof only the rights and obligations specifically provided in this Agreement with respect to Incentive Distribution Rights (and no other rights otherwise available to or other obligations of a holder of a Partnership Interest). Notwithstanding anything in this Agreement to the contrary, the holder of an Incentive Distribution Right shall not be entitled to vote such Incentive Distribution Right on any Partnership matter except as may otherwise be required by law.

“Incentive Distributions” means any amount of cash distributed to the holders of the Incentive Distribution Rights pursuant to Sections 6.3(c), (d) and (e).

“Indemnified Persons” has the meaning assigned to such term in Section 7.12(c).

“Indemnitee” means (a) the General Partner, (b) any Departing General Partner, (c) any Person who is or was an Affiliate of the General Partner or any Departing General Partner, (d) any Person who is or was a member, partner, director, officer, fiduciary or trustee of any Person which any of the preceding clauses of this definition describes, (e) any Person who is or was serving at the request of the General Partner or any Departing General Partner or any Affiliate of the General Partner or any Departing General Partner as an officer, director, member, partner, fiduciary or trustee of another Person (provided, however, that a Person shall not be an Indemnitee by reason of providing, on a fee-for-services basis, trustee, fiduciary or custodial services), and (f) any other Person the General Partner designates as an “Indemnitee” for purposes of this Agreement.

“Initial Common Units” means the Common Units sold in the Initial Offering.

“Initial Limited Partners” means Teekay Corporation and the General Partner (with respect to the Incentive Distribution Rights received by it pursuant to Section 5.1(b)), and the Underwriters, in each case upon being admitted to the Partnership in accordance with Section 10.1.

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

“Initial Unit Price” means (a) with respect to the Common Units, $21.00 (the initial public offering price per Common Unit at which the Underwriters offered the Common Units to the public for sale) or (b) with respect to any other class or series of Units, the price per Unit at which such class or series of Units is initially sold by the Partnership, as determined by the General Partner, in each case adjusted as the General Partner determines to be appropriate to give effect to any distribution, subdivision or combination of Units.

“Interim Capital Transactions” means the following transactions if they occur prior to the Liquidation Date: (a) borrowings, refinancings or refundings of indebtedness (other than Working Capital Borrowings and other than for items purchased on open account in the ordinary course of business) by any Group Member and sales of debt securities of any Group Member; (b) sales of equity interests of any Group Member (including the Common Units sold to the Underwriters pursuant to the exercise of the Over-Allotment Option); (c) sales or other voluntary or involuntary dispositions of any assets of any Group Member other than (i) sales or other

- 7 -

dispositions of inventory, accounts receivable and other assets in the ordinary course of business and (ii) sales or other dispositions of assets as part of normal retirements or replacements; (d) the termination of interest rate swap agreements; (e) capital contributions received; and (f) corporate reorganizations or restructurings.

“Investment Capital Expenditures” means capital expenditures other than Maintenance Capital Expenditures or Expansion Capital Expenditures.

“Issue Price” means the price at which a Unit is purchased from the Partnership, after reflecting any sales commission or underwriting discount charged to the Partnership.

“Junior Securities” has the meaning assigned to such term in Section 16.7.

“Limited Partner” means, unless the context otherwise requires, the Organizational Limited Partner prior to its withdrawal from the Partnership, each Initial Limited Partner, each additional Person that becomes a Limited Partner pursuant to the terms of this Agreement and any Departing General Partner upon the change of its status from General Partner to Limited Partner pursuant to Section 11.3, in each case, in such Person’s capacity as a limited partner of the Partnership; provided , however , that when the term “Limited Partner” is used herein in the context of any vote or other approval, including Articles XIII and XIV, such term shall not, solely for such purpose, include any holder of an Incentive Distribution Right (solely with respect to its Incentive Distribution Rights and not with respect to any other Limited Partner Interest held by such Person) except as may otherwise be required by law. Limited Partners may include custodians, nominees or any other individual or entity in its own or any representative capacity.

“Limited Partner Interest” means the ownership interest of a Limited Partner in the Partnership, which may be evidenced by Common Units, Preferred Units, Incentive Distribution Rights or other Partnership Securities or a combination thereof or interest therein, and includes any and all benefits to which such Limited Partner is entitled as provided in this Agreement, together with all obligations of such Limited Partner 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 Articles XIII and XIV, such term shall not, solely for such purpose, include any Incentive Distribution Right except as may otherwise be required by law.

“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 holders of Outstanding Units have the right to elect to continue the business of the Partnership 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.

“Liquidation Event” means the occurrence of a dissolution or liquidation of the Partnership, whether voluntary or involuntary; provided , however , that a Liquidation Event shall not precede the Liquidation Date. Neither the sale of all or substantially all of the property or business of the Partnership nor the consolidation or merger of the Partnership with or into any other Person, individually or in a series of transactions, shall be deemed a Liquidation Event.

- 8 -

“Liquidation Preference” means, in connection with any distribution in connection with a Liquidation Event pursuant to Section 12.4 and with respect to any holder of any class or series of Partnership Securities, the amount otherwise payable to such holder in such distribution with respect to such class or series of Partnership Securities (assuming no limitation on the assets of the Partnership available for such distribution), including an amount equal to any accrued but unpaid distributions thereon to the date fixed for such payment, whether or not declared (if the terms of the applicable class or series of Partnership Securities so provide). For avoidance of doubt, for the foregoing purposes (a) the Series A Liquidation Preference is the Liquidation Preference with respect to the Series A Preferred Units, (b) the Series B Liquidation Preference is the Liquidation Preference with respect to the Series B Preferred Units and (c) the Series E Liquidation Preference is the Liquidation Preference with respect to the Series E Preferred Units.

“Liquidator” means one or more Persons selected by the General Partner to perform the functions described in Section 12.4.

“ London Business Day ” means any day on which dealings in deposits in U.S. dollars are transacted in the London interbank market.

“Maintenance Capital Expenditures” means cash expenditures (including expenditures for the addition or improvement to the capital assets owned by any Group Member or for the acquisition or conversion of existing, or the construction of new, capital assets) if such expenditure is made to maintain the operating capacity or asset base of the Partnership Group. Maintenance Capital Expenditures shall not include (a) Expansion Capital Expenditures or (b) expenditures made solely for investment purposes (as opposed to maintenance purposes). Maintenance Capital Expenditures shall include interest (and related fees) on debt incurred and distributions on equity incurred, in each case, to finance the conversion or construction of a replacement asset and paid during the period beginning on the date that the Group Member enters into a binding obligation to commence converting or constructing a replacement asset and ending on the earlier to occur of the date that such replacement asset Commences Commercial Service or the date that such replacement asset is abandoned or disposed of. Debt incurred to pay or equity issued to fund the conversion or construction period interest payments, or such conversion or construction period distributions on equity shall also be deemed to be debt or equity, as the case may be, incurred to finance the conversion or construction of a replacement asset.

“Marshall Islands Act” means the Limited Partnership Act of the Marshall Islands, as amended, supplemented or restated from time to time, and any successor to such statute.

“Marshall Islands Registrar” means the Registrar of Corporations responsible for non-resident entities as described in Section 4 of the Marshall Islands Business Corporations Act.

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

“Minimum Quarterly Distribution” means $0.35 per Common Unit per Quarter, subject to adjustment in accordance with Section 6.5.

- 9 -

“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 by the Partnership, the Agreed Value of such property, reduced by any indebtedness either assumed by such Partner upon such distribution or to which such property is subject at the time of distribution.

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

“Omnibus Agreement” means that Amended and Restated Omnibus Agreement, dated as of the Closing Date, among Teekay Corporation, Teekay LNG Partners L.P., Teekay GP L.L.C., Teekay LNG Operating L.L.C., the General Partner, the Partnership, Teekay Offshore Operating GP L.L.C. and the Operating Company.

“Operating Company” means Teekay Offshore Operating L.P., a Marshall Islands limited partnership, and any successors thereto.

“Operating Company Agreement” means the First Amended and Restated Agreement of Limited Partnership of the Operating Company, as it may be amended, supplemented or restated from time to time.

“Operating Expenditures” means all Partnership Group expenditures (or the Partnership’s proportionate share of expenditures in the case of Subsidiaries that are not wholly owned), including taxes, reimbursements of the General Partner, repayment of Working Capital Borrowings, debt service payments, capital expenditures and Preferred Unit Distributions, subject to the following:

(a) repayment of Working Capital Borrowings deducted from Operating Surplus pursuant to clause (b)(iii) of the definition of Operating Surplus shall not constitute Operating Expenditures when actually repaid;

(b) payments (including prepayments and prepayment penalties) of principal of and premium on indebtedness other than Working Capital Borrowings shall not constitute Operating Expenditures; and

(c) Operating Expenditures shall not include (i) Expansion Capital Expenditures, Investment Capital Expenditures or actual Maintenance Capital Expenditures, but shall include Estimated Maintenance Capital Expenditures, (ii) payment of transaction expenses (including taxes) relating to Interim Capital Transactions, (iii) Preferred Unit Redemption Payments, (iv) payments made to Preferred Unit Holders to purchase or otherwise acquire Preferred Units in accordance with Section 7.1(a)(xiii) or 7.11, or (v) distributions to Partners, other than Preferred Unit Distributions.

- 10 -

Where capital expenditures consist of both (x) Maintenance Capital Expenditures and (y) Expansion Capital Expenditures and/or Investment Capital Expenditures, the General Partner, with the concurrence of the Conflicts Committee, shall determine the allocation between the amounts paid for each.

“Operating Surplus” means, with respect to any period ending prior to the Liquidation Date, on a cumulative basis and without duplication:

(a) the sum of (i) $15 million, (ii) all cash receipts of the Partnership Group (or the Partnership’s proportionate share of cash receipts in the case of Subsidiaries that are not wholly owned) for the period beginning on the Closing Date and ending on the last day of such period, other than cash receipts from Interim Capital Transactions, (iii) all cash receipts of the Partnership Group (or the Partnership’s proportionate share of cash receipts in the case of Subsidiaries that are not wholly owned) after the end of such period but on or before the date of determination of Operating Surplus with respect to such period resulting from Working Capital Borrowings and (iv) the amount of distributions paid on equity issued in connection with the conversion or construction of a Capital Improvement or replacement asset and paid during the period beginning on the date that the Group Member enters into a binding obligation to commence conversion or construction of such Capital Improvement or replacement asset and ending on the earlier to occur of the date that such Capital Improvement or replacement asset Commences Commercial Service or the date that it is abandoned or disposed of (equity issued to fund the conversion or construction period interest payments on debt incurred (including periodic net payments under related interest rate swap agreements), or conversion or construction period distributions on equity issued, to finance the conversion or construction of a Capital Improvement or replacement asset shall also be deemed to be equity issued to finance the conversion or construction of a Capital Improvement or replacement asset for purposes of this clause (iv)), less

(b) the sum of (i) Operating Expenditures for the period beginning on the Closing Date and ending on the last day of such period, (ii) the amount of cash reserves (or the Partnership’s proportionate share of cash reserves in the case of Subsidiaries that are not wholly owned) established by the General Partner to provide funds for future Operating Expenditures and (iii) all Working Capital Borrowings not repaid within twelve months after having been incurred; provided , however , that disbursements made (including contributions to a Group Member or disbursements on behalf of a Group Member) or cash reserves established, increased or reduced after the end of such period but on or before the date of determination of Available Cash with respect to such period shall be deemed to have been made, established, increased or reduced, for purposes of determining Operating Surplus, within such period if the General Partner so determines.

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

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

- 11 -

“Option Closing Date” means the date or dates on which any Common Units are sold by the Partnership to the Underwriters upon exercise of the Over-Allotment Option.

“Organizational Limited Partner” means Teekay Corporation in its capacity as the organizational limited partner of the Partnership pursuant to this Agreement.

“Original Agreement” means the First Amended and Restated Agreement of Limited Partnership of the Partnership dated as of December 19, 2006.

“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 or Group (other than the General Partner or its Affiliates) beneficially owns 20% or more of the Outstanding Partnership Securities of any class or series then Outstanding, all Partnership Securities owned by such Person or Group shall not be voted on any matter and shall not be considered to be Outstanding when sending notices of a meeting of Limited Partners to vote on any matter (unless otherwise required by law), calculating required votes, determining the presence of a quorum or for other similar purposes under this Agreement, except that Partnership Securities so owned 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 or series of Partnership Securities for purposes of this Agreement); provided , further , that the foregoing limitation shall not apply to (i) any Person or Group who acquired 20% or more of the Outstanding Partnership Securities of any class or series then Outstanding directly from the General Partner or its Affiliates, (ii) any Person or Group who acquired 20% or more of any Outstanding Partnership Securities of any class or series then Outstanding directly or indirectly from a Person or Group described in clause (i) provided that the General Partner shall have notified such Person or Group in writing that such limitation shall not apply, (iii) any Person or Group who acquired 20% or more of any Partnership Securities issued by the Partnership with the prior approval of the Board of Directors of the General Partner or (iv) with respect to any voting rights thereof, Preferred Units.

“Over-Allotment Option” means the over-allotment option granted to the Underwriters by the Partnership pursuant to the Underwriting Agreement.

“Parity Securities” has the meaning assigned to such term in Section 16.7(b).

“Partners” means the General Partner and the Limited Partners.

“Partnership” means Teekay Offshore Partners L.P., a Marshall Islands limited partnership, and any successors thereto.

“Partnership Group” means the Partnership and its Subsidiaries, including the Operating Company, treated as a single entity.

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

- 12 -

“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, Preferred Units and Incentive Distribution Rights.

“Paying Agent” means Computershare, acting in its capacity as paying agent for the particular series of Preferred Units, and its respective successors and assigns or any other payment agent appointed by the General Partner; provided , however , that if no Paying Agent is specifically designated for a particular series of Preferred Units, the General Partner shall act in such capacity.

“Percentage Interest” means as of any date of determination (a) as to the General Partner with respect to General Partner Units and as to any Unitholder with respect to Units (other than Preferred Units), the product obtained by multiplying (i) 100% less the percentage applicable to clause (b) below by (ii) the quotient obtained by dividing (A) the number of Units (other than Preferred Units) held by such Unitholder or the number of General Partner Units held by the General Partner, as the case may be, by (B) the total number of all Outstanding Units (other than Preferred Units) and General Partner Units, and (b) as to the holders of other Partnership Securities issued by the Partnership in accordance with Section 5.5, the percentage established as a part of such issuance. The Percentage Interest with respect to an Incentive Distribution Right and to a Preferred Unit shall at all times be zero.

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

“Preferred Unit Distribution Payment Date” means the Series A Distribution Payment Date, Series B Distribution Payment Date or Series E Distribution Payment Date, as applicable.

“Preferred Unit Distributions” means Series A Distributions, Series B Distributions and/or Series E Distributions, as applicable.

“Preferred Unit Holders” means Series A Holders, Series B Holders and/or Series E Holders, as applicable.

“Preferred Unit Liquidation Preference” means the Series A Liquidation Preference, Series B Liquidation Preference or Series E Liquidation Preference, as applicable.

“Preferred Unit Payments” means Series A Payments, Series B Payments and/or Series E Payments, as applicable.

“Preferred Unit Redemption Payments” means Series A Redemption Payments, Series B Redemption Payments or Series E Redemption Payments, as applicable.

“Preferred Units” means a Partnership Security, designated as a “Preferred Unit,” which entitles the holder thereof to a preference with respect to distributions, or as to the distribution of assets upon any Liquidation Event, over Common Units, including the Series A Preferred Units, the Series B Preferred Units and the Series E Preferred Units.

- 13 -

“Prior Agreement” means the Fifth Amended and Restated Agreement of Limited Partnership of the Partnership dated as of June 29, 2016.

“Pro Rata” means (a) when used with respect to Units (other than Preferred Units) or any class or series thereof, apportioned equally among all designated Units (other than Preferred Units) in accordance with their relative Percentage Interests, (b) when used with respect to Partners or Record Holders, apportioned among all Partners or Record Holders in accordance with their relative Percentage Interests and (c) when used with respect to holders of Incentive Distribution Rights or Preferred Units (or a particular series thereof), apportioned equally among all holders of Incentive Distribution Rights or Preferred Units (or such series thereof) in accordance with the relative number or percentage of Incentive Distribution Rights or Preferred Units (or such series thereof), as applicable, held by each such holder.

“Purchase Date” means the date determined by the General Partner as the date for purchase of all Outstanding Limited Partner Interests of a certain class or series (other than Limited Partner Interests owned by the General Partner and its Affiliates) pursuant to Article XV.

“Quarter” means, unless the context requires otherwise, a fiscal quarter, or, with respect to the first fiscal quarter including the Closing Date, the portion of such fiscal quarter after the Closing Date, of the Partnership.

“Record Date” means the date established by the General Partner or otherwise in accordance with this Agreement 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 to participate in any offer.

“Record Holder” means (a) the Person in whose name a Common Unit is registered on the books of the Transfer Agent as of the opening of business on a particular Business Day, (b) the Person in whose name a Preferred Unit is registered on the books of the Transfer Agent as of, unless otherwise set forth in Article XVI, the opening of business on a particular Business Day, or (c) with respect to other Partnership Interests, the Person in whose name any such other Partnership Interest is registered on the books that the General Partner has caused to be kept as of the opening of business on such Business Day.

“Registrar” 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 for the Common Units and the Preferred Units; provided , however , that if no registrar is specifically designated for any other Partnership Securities, the General Partner shall act in such capacity.

“Registration Statement” means the Registration Statement on Form F-1 (Registration No. 333-139116) as it has been or as it may be amended or supplemented from time to time, filed by the Partnership with the Commission under the Securities Act to register the offering and sale of the Common Units in the Initial Offering.

- 14 -

“ Reuters Page LIBOR01 ” means the display so designated on the Reuters 3000 Xtra (or such other page as may succeed or replace the LIBOR01 page on that service).

“Second Target Distribution” means $0.4375 per Common Unit per Quarter, subject to adjustment in accordance with Section 6.5.

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

“Senior Securities” has the meaning assigned to such term in Section 16.7(c).

“Series A Distribution Payment Date” means each February 15, May 15, August 15 and November 15, commencing August 15, 2013; provided, however, that if any Series A Distribution Payment Date would otherwise occur on a day that is not a Business Day, payment of Series A Distributions that would otherwise be payable on such date shall instead occur on the immediately succeeding Business Day as provided for in Section 16.3(a).

“Series A Distribution Period” means a period of time from and including the preceding Series A Distribution Payment Date (other than the initial Series A Distribution Period, which shall commence on and include the Series A Original Issue Date), to but excluding the next Series A Distribution Payment Date for such Series A Distribution Period.

“Series A Distribution Rate” means a rate equal to 7.25% per annum of the Stated Series A Liquidation Preference per Series A Preferred Unit.

“Series A Distribution Record Date” has the meaning assigned to such term in Section 16.3(b).

“Series A Distributions” means distributions with respect to Series A Preferred Units pursuant to Section 16.3.

“Series A Holder” means a Record Holder of the Series A Preferred Units.

“Series A Liquidation Preference” means a liquidation preference for each Series A Preferred Unit initially equal to the Stated Series A Liquidation Preference per unit, which liquidation preference shall be subject to (a) increase by the per Series A Preferred Unit amount of any accumulated and unpaid distributions (whether or not such distributions shall have been declared) and (b) decrease upon a distribution in connection with a Liquidation Event described in Section 16.4 which does not result in payment in full of the liquidation preference of such Series A Preferred Unit.

“Series A Original Issue Date” means April 30, 2013.

“Series A Payments” means, collectively, Series A Distributions and Series A Redemption Payments.

“Series A Preferred Unit” means a Preferred Unit having the designations, preferences, rights, powers and duties set forth in Article XVI.

- 15 -

“Series A Redemption Date” has the meaning assigned to such term in Section 16.6.

“Series A Redemption Notice” has the meaning assigned to such term in Section 16.6(b).

“Series A Redemption Price” has the meaning assigned to such term in Section 16.6(a).

“Series A Redemption Payments” means payments to be made to the holders of Series A Preferred Units to redeem Series A Preferred Units in accordance with Section 16.6.

“Series B Distribution Payment Date” means each February 15, May 15, August 15 and November 15, commencing August 15, 2015; provided, however, that if any Series B Distribution Payment Date would otherwise occur on a day that is not a Business Day, payment of Series B Distributions that would otherwise be payable on such date shall instead occur on the immediately succeeding Business Day as provided for in Section 16.3(a).

“Series B Distribution Period” means a period of time from and including the preceding Series B Distribution Payment Date (other than the initial Series B Distribution Period, which shall commence on and include the Series B Original Issue Date), to but excluding the next Series B Distribution Payment Date for such Series B Distribution Period.

“Series B Distribution Rate” means a rate equal to 8.50% per annum of the Stated Series B Liquidation Preference per Series B Preferred Unit.

“Series B Distribution Record Date” has the meaning assigned to such term in Section 16.3(b).

“Series B Distributions” means distributions with respect to Series B Preferred Units pursuant to Section 16.3.

“Series B Holder” means a Record Holder of the Series B Preferred Units.

“Series B Liquidation Preference” means a liquidation preference for each Series B Preferred Unit initially equal to the Stated Series B Liquidation Preference per unit, which liquidation preference shall be subject to (a) increase by the per Series B Preferred Unit amount of any accumulated and unpaid distributions (whether or not such distributions shall have been declared) and (b) decrease upon a distribution in connection with a Liquidation Event described in Section 16.4 which does not result in payment in full of the liquidation preference of such Series B Preferred Unit.

“Series B Original Issue Date” means April 20, 2015.

“Series B Payments” means, collectively, Series B Distributions and Series B Redemption Payments.

“Series B Preferred Unit” means a Preferred Unit having the designations, preferences, rights, powers and duties set forth in Article XVI.

“Series B Redemption Date” has the meaning assigned to such term in Section 16.6.

- 16 -

“Series B Redemption Notice” has the meaning assigned to such term in Section 16.6(b).

“Series B Redemption Price” has the meaning assigned to such term in Section 16.6(a).

“Series B Redemption Payments” means payments to be made to the holders of Series B Preferred Units to redeem Series B Preferred Units in accordance with Section 16.6.

“Series E Distribution Payment Date” means each February 15, May 15, August 15 and November 15, commencing May 15, 2018; provided , however , that (i) if any Series E Distribution Payment Date during the Series E Fixed Rate Period would otherwise occur on a day that is not a Business Day, payment of Series E Distributions that would otherwise be payable on such date shall instead occur on the immediately succeeding Business Day as provided for in Section 16.3(a), and (ii) if any Series E Distribution Payment Date during the Series E Floating Rate Period would otherwise occur on a day that is not a Business Day, such Series E Distribution Payment Date shall instead be on the immediately succeeding Business Day.

“Series E Distribution Period” means a period of time from and including the preceding Series E Distribution Payment Date (other than the initial Series E Distribution Period, which shall commence on and include the Series E Original Issue Date), to but excluding the next Series E Distribution Payment Date for such Series E Distribution Period.

“Series E Distribution Rate” means a rate equal to (a) during the Series E Fixed Rate Period, 8.875% per annum of the Stated Series E Liquidation Preference per Series E Preferred Unit and (b) during the Series E Floating Rate Period, a percentage per annum of the Stated Series E Liquidation Preference per Series E Preferred Unit equal to the sum of (i) Series E Three-Month LIBOR, as calculated on each applicable Series E LIBOR Determination Date, and (ii) 6.407%.

“Series E Distribution Record Date” has the meaning assigned to such term in Section 16.3(b).

“Series E Distributions” means distributions with respect to Series E Preferred Units pursuant to Section 16.3.

“Series E Fixed Rate Period” means the period from and including the Series E Original Issue Date to, but not including, February 15, 2025.

“Series E Floating Rate Period” means the period from and including February 15, 2025 to, but not including, the date that all of the Series E Preferred Units are redeemed in full in accordance with Section 16.6 or are otherwise not outstanding.

“Series E Holder” means a Record Holder of the Series E Preferred Units.

“ Series E LIBOR Determination Date ” means the London Business Day immediately preceding the first date of the applicable Series E Distribution Period during the Series E Floating Rate Period.

- 17 -

“Series E Liquidation Preference” means a liquidation preference for each Series E Preferred Unit initially equal to the Stated Series E Liquidation Preference per unit, which liquidation preference shall be subject to (a) increase by the per Series E Preferred Unit amount of any accumulated and unpaid distributions (whether or not such distributions shall have been declared) and (b) decrease upon a distribution in connection with a Liquidation Event described in Section 16.4 which does not result in payment in full of the liquidation preference of such Series E Preferred Unit.

“Series E Original Issue Date” means January 23, 2018.

“Series E Payments” means, collectively, Series E Distributions and Series E Redemption Payments.

“Series E Preferred Unit” means a Preferred Unit having the designations, preferences, rights, powers and duties set forth in Article XVI.

“Series E Redemption Date” has the meaning assigned to such term in Section 16.6.

“Series E Redemption Notice” has the meaning assigned to such term in Section 16.6(b).

“Series E Redemption Price” has the meaning assigned to such term in Section 16.6(a).

“Series E Redemption Payments” means payments to be made to the holders of Series E Preferred Units to redeem Series E Preferred Units in accordance with Section 16.6.

“ Series E Three-Month LIBOR ” means, in respect of each Series E Distribution Period during the Series E Floating Rate Period, the following rate determined by the Calculation Agent, as of the applicable Series E LIBOR Determination Date in accordance with the following provisions:

(a) the rate (expressed as a percentage per year) for deposits in U.S. dollars for a three-month period commencing on the first day of such period that appears on Reuters Page LIBOR01 as of 11:00 a.m. (London time) on the applicable Series E LIBOR Determination Date; or

(b) If the Calculation Agent determines that three-month LIBOR (as contemplated by the immediately preceding clause (a)) has been discontinued, then it will determine whether to use a substitute or successor base rate that it has determined in its sole discretion is most comparable to three-month LIBOR, provided that if the Calculation Agent determines there is an industry accepted successor base rate, the Calculation Agent shall use such successor base rate. If the Calculation Agent has determined a substitute or successor base rate in accordance with the foregoing, the Calculation Agent in its sole discretion may also implement changes to the business day convention, the definition of business day, the Series E LIBOR Determination Date and any method for obtaining the substitute or successor base rate if such rate is unavailable on the relevant business day, in a manner that is consistent with industry accepted practices for such substitute or successor base rate. Unless the Calculation Agent determines to use a substitute or successor base rate as so provided, the following will apply: if the rate described in the immediately preceding clause (a) is not so published, the Calculation Agent shall select four

- 18 -

major banks in the London interbank market and request that the principal London offices of those four selected banks provide their offered quotations for deposits in U.S. dollars for a period of three months, commencing on the first day of the applicable period, to prime banks in the London interbank market at approximately 11:00 a.m. (London time) on the Series E LIBOR Determination Date for such period. Offered quotations must be based on a principal amount equal to an amount that, in the Calculation Agent’s judgment, is representative of a single transaction in U.S. dollars in the London interbank market at the time. If two or more quotations are provided, Series E Three-Month LIBOR for such period will be the arithmetic mean of the quotations. If fewer than two quotations are provided, Series E Three-Month LIBOR for such period will be the arithmetic mean of the rates quoted on the Series E LIBOR Determination Date for such period by three major banks in New York City selected by the Calculation Agent, for loans in U.S. dollars to leading European banks for a three-month period commencing on the first day of such period. The rates quoted must be based on an amount that, in the Calculation Agent’s judgment, is representative of a single transaction in U.S. dollars in that market at the time. If fewer than three New York City banks selected by the Calculation Agent are quoting rates in the manner described above, Series E Three-Month LIBOR for the applicable period will be the same as for the immediately preceding period or, if the immediately preceding period was within the Series E Fixed Rate Period, the same as for the most recent quarter for which Series E Three-Month LIBOR can be determined.

All percentages resulting from any of the calculations described in the immediately preceding clauses (a) and (b) will be rounded, if necessary, to the nearest one hundred-thousandth of a percentage point (with five one-millionths of a percentage point rounded upwards) and all dollar amounts used in or resulting from such calculations will be rounded, if necessary, to the nearest cent (with one-half cent being rounded upwards).

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

“Stated Preferred Unit Liquidation Preference” means the Stated Series A Liquidation Preference, Stated Series B Liquidation Preference or Stated Series E Liquidation Preference, as applicable.

“Stated Series A Liquidation Preference” means an amount equal to $25.00 per Series A Preferred Unit.

“Stated Series B Liquidation Preference” means an amount equal to $25.00 per Series B Preferred Unit.

“Stated Series E Liquidation Preference” means an amount equal to $25.00 per Series E Preferred Unit.

“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 (as defined, but excluding subsection (d) of this definition) of such Person or a combination thereof,

- 19 -

(b) a partnership (whether general or limited) in which such Person or a Subsidiary (as defined, but excluding subsection (d) of this definition) 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 the partnership as a single class) is owned, directly or indirectly, at the date of determination, by such Person, by one or more Subsidiaries (as defined, but excluding subsection (d) of this definition) of such Person, or a combination thereof, (c) any other Person (other than a corporation or a partnership) in which such Person, one or more Subsidiaries (as defined, but excluding subsection (d) of this definition) of such Person, or a combination thereof, directly or indirectly, at the date of determination, has (i) 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, or (d) any other Person in which such Person, one or more Subsidiaries (as defined, but excluding subsection (d) of this definition) of such Person, or a combination thereof, directly or indirectly, at the date of determination, has (i) less than a majority ownership interest or (ii) less than the power to elect or direct the election of a majority of the directors or other governing body of such Person, provided that (A) such Person, one or more Subsidiaries (as defined, but excluding this subsection (d) of this definition) of such Person, or a combination thereof, directly or indirectly, at the date of the determination, has at least a 20% ownership interest in such other Person, (B) such Person accounts for such other Person (under U.S. GAAP, as in effect on the later of the date of investment in such other Person or material expansion of the operations of such other Person) on a consolidated or equity accounting basis, (C) such Person has directly or indirectly material negative control rights regarding such other Person including over such other Person’s ability to materially expand its operations beyond that contemplated at the date of investment in such other Person, and (D) such other Person is (i) other than with respect to the Operating Company, formed and maintained for the sole purpose of owning or leasing, operating and chartering no more than 10 vessels for a period of no more than 40 years, and (ii) obligated under its constituent documents, or as a result of a unanimous agreement of its owners, to distribute to its owners all of its income on at least an annual basis (less any cash reserves that are approved by such Person).

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

“Third Target Distribution” means $0.525 per unit per Quarter, subject to adjustment in accordance with Section 6.5.

“Trading Day” means, for the purpose of determining the Current Market Price of any class or series of Limited Partner Interests, a day on which the principal National Securities Exchange on which such class or series of Limited Partner Interests is listed is open for the transaction of business or, if Limited Partner Interests of a class or series are not listed on any National Securities Exchange, a day on which banking institutions in New York City generally are open.

“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 transfer agent for the Common Units and the Preferred Units; provided , however , that if no transfer agent is specifically designated for any other Partnership Securities, the General Partner shall act in such capacity.

- 20 -

“Underwriter” means each Person named as an underwriter in Schedule I to the Underwriting Agreement who purchases Common Units pursuant thereto.

“Underwriting Agreement” means the Underwriting Agreement dated December 13, 2006 among the Underwriters, the Partnership, the General Partner, the Operating Company, and Teekay Corporation, providing for the purchase of Common Units by such Underwriters.

“Unit” means a Partnership Security that is designated as a “Unit” and shall include Common Units and Preferred Units, but shall not include (i) General Partner Units (or the General Partner Interest represented thereby) or (ii) the Incentive Distribution Rights.

“Unit Majority” means a majority of the Outstanding Common Units, voting as a class.

“Unit Register” means the register of the Partnership for the registration and transfer of Limited Partnership Interests as provided in Section 4.5.

“Unitholders” means the holders of Units.

“Unrecovered Capital” means at any time, with respect to a Common Unit, the Initial Unit Price less the sum of all distributions constituting Capital Surplus theretofore made in respect of an Initial Common Unit and any distributions of cash (or the Net Agreed Value of any distributions in kind) in connection with the dissolution and liquidation of the Partnership theretofore made in respect of an Initial Common Unit, adjusted as the General Partner determines to be appropriate to give effect to any distribution, subdivision or combination of such Units.

“U.S. GAAP” means United States generally accepted accounting principles consistently applied.

“Working Capital Borrowings” means borrowings used solely for working capital purposes or to pay distributions to Partners made pursuant to a credit facility, commercial paper facility or similar financing arrangement available to a Group Member, provided that when such borrowing is incurred it is the intent of the borrower to repay such borrowing within 12 months from sources other than additional Working Capital Borrowings.

Section 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; (c) the term “include” or “includes” means includes, without limitation, and “including” means including, without limitation; and (d) the terms “hereof”, “herein” and “hereunder” refer to this Agreement as a whole and not to any particular provision of this Agreement. The table of contents and headings contained in this Agreement are for reference purposes only, and shall not affect in any way the meaning or interpretation of this Agreement.

- 21 -

ARTICLE II

ORGANIZATION

Section 2.1

Formation.

The General Partner and the Organizational Limited Partner have previously formed the Partnership as a limited partnership pursuant to the provisions of the Marshall Islands Act and hereby amend and restate the Prior Agreement in its entirety. This amendment and restatement shall become effective on the date of this Agreement. 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 Marshall Islands 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.

Section 2.2

Name.

The name of the Partnership shall be “Teekay Offshore Partners L.P.” The Partnership’s business may be conducted under any other name or names as determined by the General Partner, including the name of the General Partner. The words “Limited Partnership” or the letters “L.P.” 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 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.

Section 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 Marshall Islands shall be located at Trust Company Complex, Ajeltake Island, Ajeltake Road, Majuro, Marshall Islands MH 96960, and the registered agent for service of process on the Partnership in the Marshall Islands at such registered office shall be The Trust Company of The Marshall Islands, Inc. The principal office of the Partnership shall be located at 4th Floor, Belvedere Building, 69 Pitts Bay Road, Hamilton, HM 08, Bermuda 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 Marshall Islands as the General Partner determines to be necessary or appropriate. The address of the General Partner shall be 4th Floor, Belvedere Building, 69 Pitts Bay Road, Hamilton, HM 08, Bermuda or such other place as the General Partner may from time to time designate by notice to the Limited Partners.

Section 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

- 22 -

liability company or other arrangement to engage indirectly in, any business activity that is approved by the General Partner and that lawfully may be conducted by a limited partnership organized pursuant to the Marshall Islands 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, and (b) do anything necessary or appropriate to the foregoing, including the making of capital contributions or loans to a Group Member. The General Partner shall have no duty or obligation to propose or approve, and may decline to propose or approve, the conduct by the Partnership of any business free of any fiduciary duty or obligation whatsoever to the Partnership, any Limited Partner and, in declining to so propose or approve, shall not be required to act in good faith or pursuant to any other standard imposed by this Agreement, any Group Member Agreement, any other agreement contemplated hereby or under the Marshall Islands Act or any other law, rule or regulation.

Section 2.5

Powers.

The Partnership shall be empowered to do any and all acts and things necessary and appropriate for the furtherance and accomplishment of the purposes and business described in Section 2.4 and for the protection and benefit of the Partnership.

Section 2.6

Power of Attorney.

(a) Each Limited Partner hereby constitutes and appoints the General Partner and, if a Liquidator shall have been selected pursuant to Section 12.3, the Liquidator (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 determines to be 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 Marshall Islands 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 determines to be 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 determines to be 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, Articles IV, X, XI or 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 5.5; and (F) all certificates, documents and other instruments (including agreements and a certificate of merger) relating to a merger, consolidation or conversion of the Partnership pursuant to Article XIV; and

- 23 -

(ii) execute, swear to, acknowledge, deliver, file and record all ballots, consents, approvals, waivers, certificates, documents and other instruments that the General Partner or the Liquidator determines to be necessary or appropriate 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 (B) effectuate the terms or intent of this Agreement; provided , however , 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.

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 and the transfer of all or any portion of such Limited Partner’s Partnership Interest and shall extend to such Limited Partner’s heirs, successors, assigns and personal representatives. Each such Limited Partner 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, 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 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 determines to be necessary or appropriate to effectuate this Agreement and the purposes of the Partnership.

Section 2.7

Term.

The term of the Partnership commenced upon the filing of the Certificate of Limited Partnership in accordance with the Marshall Islands Act and shall continue in existence until the 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 Marshall Islands Act.

Section 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, individually or collectively, shall have any ownership interest in such Partnership assets or any

- 24 -

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 commercially 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; and, 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.

ARTICLE III

RIGHTS OF LIMITED PARTNERS

Section 3.1

Limitation of Liability.

The Limited Partners shall have no liability under this Agreement except as expressly provided in this Agreement or the Marshall Islands Act.

Section 3.2

Management of Business.

No Limited Partner, in its capacity as such, shall participate in the operation, management or control (within the meaning of the Marshall Islands 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, manager, member, general partner, agent or trustee of the General Partner or any of its Affiliates, or any officer, director, employee, manager, 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 30 of the Marshall Islands Act) and shall not affect, impair or eliminate the limitations on the liability of the Limited Partners under this Agreement.

Section 3.3

Outside Activities of the Limited Partners.

Subject to the provisions of Section 7.5 and the Omnibus Agreement, which shall continue to be applicable to the Persons referred to therein, regardless of whether such Persons shall also be Limited Partners, any Limited Partner 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 shall have any rights by virtue of this Agreement in any business ventures of any Limited Partner.

- 25 -

Section 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, to:

(i) obtain, promptly after becoming available, a copy of the Partnership’s financial statements or income tax returns, if applicable, for each year;

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

(iii) 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;

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

(vi) 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, for such period of time as the General Partner deems reasonable, (i) any information that the General Partner reasonably believes to be in the nature of trade secrets or (ii) 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

Section 4.1

Certificates.

Upon the Partnership’s issuance of Common Units or Preferred Units to any Person and subject to Section 16.2(b) with respect to any series of Preferred Units described therein, the Partnership shall issue, upon the request of such Person, one or more Certificates in the name of such Person evidencing the number of such Units being so issued. In addition, (a) upon the General Partner’s request, the Partnership shall issue to it one or more Certificates in the name of

- 26 -

the General Partner evidencing its General Partner Units and (b) upon the request of any Person owning Incentive Distribution Rights or any other Partnership Securities other than Common Units or Preferred Units, the Partnership shall issue to such Person one or more certificates evidencing such Incentive Distribution Rights or other Partnership Securities other than Common Units or Preferred Units. Certificates shall be executed on behalf of the Partnership by the Chairman of the Board, President or any Executive Vice President or Vice President and the Chief Financial Officer or the Secretary or any Assistant Secretary of the General Partner. No Common Unit Certificate or Preferred Unit 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 Common Units or Preferred Units in global form, the Common Unit Certificates or the Preferred Unit Certificates shall be valid upon receipt of a certificate from the Transfer Agent certifying that the Common Units or Preferred Units have been duly registered in accordance with the directions of the Partnership.

Section 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 the Transfer Agent shall countersign and deliver 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 the Transfer Agent shall countersign, 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 General Partner, that a previously issued Certificate has been lost, destroyed or stolen;

(ii) requests the issuance of a new Certificate before the General Partner 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 General Partner, delivers to the General Partner a bond, in form and substance satisfactory to the General Partner, with surety or sureties and with fixed or open penalty as the General Partner may direct to indemnify the Partnership, the Partners, 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 General Partner.

If a Limited Partner fails to notify the General Partner within a reasonable period of 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 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.

- 27 -

(c) As a condition to the issuance of any new Certificate under this Section 4.2, the General Partner 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.

Section 4.3

Record Holders.

The Partnership shall be entitled to recognize the Record Holder as the Partner 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 such Partnership Interests are listed or admitted to 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 Partnership Interests, as between the Partnership on the one hand, and such other Persons on the other, such representative Person shall be the Record Holder of such Partnership Interest.

Section 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 by which a holder of Incentive Distribution Rights assigns its Incentive Distribution Rights to another Person, and includes a sale, assignment, gift, pledge, encumbrance, hypothecation, mortgage, exchange or any other disposition by law or otherwise or (ii) by which the holder of a Limited Partner Interest (other than an Incentive Distribution Right) assigns such Limited Partner Interest to another Person who is or becomes a Limited Partner, and includes a sale, assignment, gift, exchange or any other disposition by law or otherwise, including any transfer upon foreclosure of any pledge, encumbrance, hypothecation or mortgage.

(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, partner or other owner of the General Partner of any or all of the shares of stock, membership interests, partnership interests or other ownership interests in the General Partner.

Section 4.5

Registration and Transfer of Limited Partner Interests.

(a) The General Partner 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 Registrar and Transfer Agent are hereby appointed registrar and

- 28 -

transfer agent for the purpose of registering Common Units and Preferred Units and transfers of such Common Units and Preferred Units as herein provided. The Partnership shall not recognize transfers of Certificates evidencing Limited Partner Interests unless such transfers are effected 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, the Transfer Agent shall countersign and deliver, 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.

(b) The General Partner shall not recognize any transfer of Limited Partner Interests until the Certificates, if any, evidencing such Limited Partner Interests are surrendered for registration of transfer. No charge shall be imposed by the General Partner for such transfer; provided , however , that as a condition to the issuance of any new Certificate under this Section 4.5, the General Partner may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed with respect thereto.

(c) The General Partner and its Affiliates shall have the right at any time to transfer their Common Units or any Preferred Units to one or more Persons.

Section 4.6

Transfer of the General Partner’s General Partner Interest.

(a) Subject to Section 4.6(b) below the General Partner may transfer all or any of its General Partner Interest without Unitholder approval.

(b) 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 (i) the transferee agrees to assume the rights and duties of the General Partner under this Agreement and to be bound by the provisions of this Agreement, (ii) the Partnership receives an Opinion of Counsel that such transfer would not result in the loss of limited liability of any Limited Partner or of any limited partner or member of any other Group Member and (iii) such transferee also agrees to purchase all (or the appropriate portion thereof, if applicable) of the partnership or membership interest of the General Partner as the general partner or managing member, if any, 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 the General Partner immediately prior to the transfer of the General Partner Interest, and the business of the Partnership shall continue without dissolution.

Section 4.7

Transfer of Incentive Distribution Rights.

The General Partner or any other holder of Incentive Distribution Rights may transfer any or all of its Incentive Distribution Rights without Unitholder approval. Notwithstanding anything herein to the contrary, no transfer of Incentive Distribution Rights to another Person shall be permitted unless the transferee agrees to be bound by the provisions of this Agreement.

- 29 -

The General Partner and any transferee or transferees of the Incentive Distribution Rights may agree in a separate instrument as to the General Partner’s exercise of its rights with respect to the Incentive Distribution Rights under Section 11.3 hereof.

Section 4.8

Restrictions on Transfers.

(a) Except as provided in Section 4.8(b) below, but notwithstanding the other provisions of this Article IV, no transfer of any Partnership Interests shall be made if such transfer would (i) violate the then applicable U.S. federal or state securities laws, laws of the Marshall Islands, or rules and regulations of the Commission, any state securities commission or any other governmental authority with jurisdiction over such transfer or (ii) terminate the existence or qualification of the Partnership or any Group Member under the laws of the jurisdiction of its formation.

(b) 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 or admitted to trading.

ARTICLE V

CAPITAL CONTRIBUTIONS AND ISSUANCE OF PARTNERSHIP INTERESTS

Section 5.1

Organizational Contributions.

(a) In connection with the formation of the Partnership under the Marshall Islands Act, the General Partner made an initial Capital Contribution to the Partnership in the amount of $20, for a 2% General Partner Interest in the Partnership and was admitted as the General Partner of the Partnership, and the Organizational Limited Partner made an initial Capital Contribution to the Partnership in the amount of $980 for a 98% Limited Partner Interest in the Partnership and was admitted as a Limited Partner of the Partnership.

(b) Prior to the Closing Date (i) the General Partner contributed its 0.52% ownership interest in the Operating Company to the Partnership in exchange for (A) a continuation of its 2% General Partner Interest, (B) the Incentive Distribution Rights and (C) the assumption by the Partnership of a $2.7 million note representing 2% of the total cash to be paid to Teekay Corporation from the proceeds of the Initial Offering, and (ii) Teekay Corporation contributed to the Partnership (A) all of its ownership interest in the general partner of the Operating Company and (B) a 25.47% limited partner interest in the Operating Company, in exchange for a continuation of its 98% limited partner interest in the Partnership and a $131.7 million note representing 98% of the total cash to be paid to Teekay Corporation from the proceeds of the Initial Offering.

Section 5.2

Initial Unit Issuances; General Partner Pre-emptive Rights.

(a) On or prior to the Closing Date and pursuant to the Contribution Agreement, (i) Teekay Corporation’s 98% initial limited partner interest was converted into (A) 2,800,000 Common Units and (B) 9,800,000 Subordinated Units (as defined in the Original Agreement) and (ii) the Partnership issued to the General Partner, for no additional consideration, 400,000 General Partner Units evidencing the General Partner’s 2% General Partner Interest.

- 30 -

(b) Upon the issuance of any additional Limited Partner Interests by the Partnership (other than Common Units issued in the Initial Offering, including any Common Units issued pursuant to the Over-Allotment Option), the General Partner may, in exchange for a proportionate number of General Partner Units, make additional Capital Contributions in an amount equal to the product obtained by multiplying (i) the quotient determined by dividing (A) the General Partner’s Percentage Interest immediately prior to such issuance by (B) 100 less the General Partner’s Percentage Interest immediately prior to such issuance by (ii) the amount contributed to the Partnership by the Limited Partners in exchange for such additional Limited Partner Interests. The General Partner shall not be obligated to make any additional Capital Contributions to the Partnership. The General Partner’s Percentage Interest shall not change as a result of the issuance of any Preferred Units. However, the General Partner shall be entitled to participate in any Preferred Unit Payments only to the extent of its proportionate Capital Contribution with respect to any such issuance of the applicable series of Preferred Units.

Section 5.3

Contributions by Initial Limited Partners and Distributions to the General Partner and its Affiliates.

(a) On the Closing Date and pursuant to the Underwriting Agreement, each Underwriter contributed to the Partnership cash in an amount equal to the Issue Price per Initial Common Unit, multiplied by the number of Common Units specified in the Underwriting Agreement to be purchased by such Underwriter at the Closing Date. In exchange for such Capital Contributions by the Underwriters, the Partnership issued Common Units to each Underwriter on whose behalf such Capital Contribution was made in an amount equal to the number of Common Units specified in the Underwriting Agreement to be purchased by such Underwriter on the Closing Date.

(b) Upon exercise of the Over-Allotment Option, each Underwriter contributed to the Partnership cash in an amount equal to the Issue Price per Initial Common Unit, multiplied by the number of Common Units to be purchased by such Underwriter at the Option Closing Date. In exchange for such Capital Contributions by the Underwriters, the Partnership issued Common Units to each Underwriter on whose behalf such Capital Contribution was made in an amount equal to the quotient obtained by dividing (i) the cash contributions to the Partnership by or on behalf of such Underwriter by (ii) the Issue Price per Initial Common Unit. Upon receipt by the Partnership of the Capital Contributions from the Underwriters as provided in this Section 5.3(b), the Partnership used such cash to redeem from Teekay Corporation that number of Common Units equal to the number of Common Units issued to the Underwriters as provided in this Section 5.3(b).

(c) No Limited Partner Interests were issued or issuable as of or at the Closing Date other than (i) the Common Units issuable pursuant to subparagraph (a) of this Section 5.3 in aggregate number equal to 7,000,000, (ii) the “Option Units” as such term is used in the Underwriting Agreement in an aggregate number up to 1,050,000 issuable upon exercise of the Over-Allotment Option pursuant to subparagraph (c) hereof, (iii) the 9,800,000 Subordinated Units issuable pursuant to Section 5.2 hereof, (iv) the 2,800,000 Common Units issuable pursuant to Section 5.2 hereof, and (v) the Incentive Distribution Rights.

- 31 -

Section 5.4

Interest and Withdrawal.

No interest shall be paid by the Partnership on Capital Contributions. No Partner 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 and permitted 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 shall have priority over any other Partner either as to the return of Capital Contributions or as to profits, losses or distributions.

Section 5.5

Issuances of Additional Partnership Securities.

(a) Subject to any approvals required by Preferred Unit Holders pursuant to Section 16.5(c)(ii), the Partnership may issue additional Partnership Securities and options, rights, warrants and appreciation rights relating to the 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 the General Partner shall determine, all without the approval of any Limited Partners.

(b) Each additional Partnership Security authorized to be issued by the Partnership pursuant to Section 5.5(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, including (i) the right to share in Partnership distributions; (ii) the rights upon dissolution and liquidation of the Partnership; (iii) whether, and the terms and conditions upon which, the Partnership may or shall be required to redeem the Partnership Security (including sinking fund provisions); (iv) 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; (v) the terms and conditions upon which each Partnership Security will be issued, evidenced by certificates and assigned or transferred; (vi) the method for determining the Percentage Interest as to such Partnership Security; and (vii) the right, if any, of each 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 shall take all actions that it determines to be necessary or appropriate in connection with (i) each issuance of Partnership Securities and options, rights, warrants and appreciation rights relating to Partnership Securities pursuant to this Section 5.5, (ii) the conversion of the General Partner Interest (represented by General Partner Units) or any Incentive Distribution Rights into 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 shall determine the relative rights, powers and duties of the holders of the Units or other Partnership Securities being so issued. The General Partner shall do all things necessary to comply with the Marshall Islands Act and is authorized and directed to do all things that it determines to be necessary or appropriate in connection with any future issuance

- 32 -

of Partnership Securities or in connection with the conversion of the General Partner Interest or any Incentive Distribution Rights into 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 Units or other Partnership Securities are listed or admitted to trading.

Section 5.6

Limitations on Issuance of Additional Partnership Securities.

The Partnership may issue an unlimited number of Partnership Securities (or options, rights, warrants or appreciation rights related thereto) pursuant to Section 5.5 without the approval of the Limited Partners; provided , however , that no fractional units shall be issued by the Partnership.

Section 5.7

Limited Preemptive Right.

Except as provided in this Section 5.7 and in Section 5.2(b), no Person shall have any preemptive, preferential or other similar right with respect to the issuance of any Partnership Security, whether unissued, held in the treasury or hereafter created. The General Partner shall have the right, which it may from time to time assign in whole or in part to any of its Affiliates, to purchase Partnership Securities from the Partnership whenever, and on the same terms that, the Partnership issues Partnership Securities to Persons other than the General Partner and its Affiliates, to the extent necessary to maintain the Percentage Interests of the General Partner and its Affiliates equal to that which existed immediately prior to the issuance of such Partnership Securities; provided, however , that the amount of any series of Preferred Units issued by the Partnership from time to time that the General Partner shall have a right to purchase pursuant to this Section 5.7 shall equal the product of (a) the aggregate Percentage Interest of the General Partner and its Affiliates multiplied by (b) the number of such series of Preferred Units so issued.

Section 5.8

Splits and Combinations.

(a) Subject to Sections 5.8(d) and 6.5 (dealing with adjustments of distribution levels), the Partnership may make a Pro Rata distribution of Partnership Securities (other than Preferred Units) to all Record Holders of the same class or series of Partnership Securities or may effect a subdivision or combination of the same class or series of Partnership Securities so long as, after any such event, each Partner holding such class or series of such Partnership Securities shall have the same Percentage Interest in the Partnership as before such event, and any amounts calculated on a per Unit basis (including those based on the applicable Preferred Unit Liquidation Preference or the applicable Stated Preferred Unit Liquidation Preference) or stated as a number of Units are proportionately adjusted, to the extent applicable.

(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.

- 33 -

(c) Promptly following any such distribution, subdivision or combination, the Partnership may issue Certificates 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 that it determines to be necessary or 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, the surrender of any Certificate 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 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).

Section 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 the Marshall Islands Act.

ARTICLE VI

ALLOCATIONS AND DISTRIBUTIONS

Section 6.1

Allocations.

For purposes of the Marshall Islands Act, the Partnership’s items of income, gain, loss and deduction shall be allocated among the Partners in each taxable year (or portion thereof) as follows:

(a) to each (i) Series A Holder, an allocation of items of income, including if necessary items of gross income, in an amount equal to the difference, if any, between (A) the excess of the Series A Liquidation Preference attributable to such Series A Holder over the Stated Series A Liquidation Preference attributable to such Series A Holder and (B) the cumulative amount of all prior allocations of income to such Series A Holder pursuant to this Section 6.1(a), (ii) Series B Holder, an allocation of items of income, including if necessary items of gross income, in an amount equal to the difference, if any, between (A) the excess of the Series B Liquidation Preference attributable to such Series B Holder over the Stated Series B Liquidation Preference attributable to such Series B Holder and (B) the cumulative amount of all prior allocations of income to such Series B Holder pursuant to this Section 6.1(a), and (iii) Series E Holder, an allocation of items of income, including if necessary items of gross income, in an amount equal to the difference, if any, between (A) the excess of the Series E Liquidation Preference attributable to such Series E Holder over the Stated Series E Liquidation Preference attributable to such Series E Holder and (B) the cumulative amount of all prior allocations of income to such Series E Holder pursuant to this Section 6.1(a), provided that, in the event the

- 34 -

Partnership’s gross income for a taxable year (or portion thereof) is less than the sum of the amounts determined pursuant to clauses (i), (ii) and (iii), allocations shall be made pro rata to Series A Holders, Series B Holders and Series E Holders in proportion to the amounts set forth in clauses (i), (ii) and (iii) above; and

(b) (after taking into account any allocations of gross income to a Series A Holder, Series B Holder, or Series E Holder, as applicable, pursuant to Section 6.1(a)), in a manner such that all allocations to the Partners (including allocations made pursuant to Section 6.1(a)) are in accordance with the Partners’ interests in the Partnership, taking into account Sections 6.3, 6.4 and 12.4 and Article XVI.

Section 6.2

Requirement and Characterization of Distributions; Distributions to Record Holders.

(a) Subject to Section 16.3, within 45 days following the end of each Quarter commencing with the Quarter ending on December 31, 2006, an amount equal to 100% of Available Cash with respect to such Quarter shall, subject to Section 51 of the Marshall Islands Act, be distributed in accordance with this Article VI by the Partnership to the Partners as of the Record Date selected by the General Partner. All amounts of Available Cash distributed by the Partnership on any date from any source shall be deemed to be Operating Surplus until the sum of all amounts of Available Cash theretofore distributed by the Partnership to the Partners pursuant to Section 6.3 equals the Operating Surplus from the Closing Date through the close of the immediately preceding Quarter. Any remaining amounts of Available Cash distributed by the Partnership on such date shall, except as otherwise provided in Section 6.4, be deemed to be “Capital Surplus.” This Section 6.2(a) shall not apply to Preferred Units.

(b) Notwithstanding Section 6.2(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.

(c) 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.

Section 6.3

Distributions of Available Cash from Operating Surplus.

Available Cash with respect to any Quarter that is deemed to be Operating Surplus pursuant to the provisions of Sections 6.2 or 6.4, shall, subject to Section 51 of the Marshall Islands Act, be distributed as follows (subject to Section 16.3 in respect of any series of Preferred Units described therein and except as otherwise required by Section 5.5 in respect of additional Partnership Securities issued pursuant thereto):

(a) First, 100% to the General Partner and the Unitholders in accordance with their respective Percentage Interests, until there has been distributed in respect of each Unit then Outstanding an amount equal to the Minimum Quarterly Distribution for such Quarter;

- 35 -

(b) Second, 100% to the General Partner and the Unitholders in accordance with their respective Percentage Interests, until there has been distributed in respect of each Unit then Outstanding an amount equal to the excess of the First Target Distribution over the Minimum Quarterly Distribution for such Quarter;

(c) Third, (i) to the General Partner in accordance with its Percentage Interest; (ii) 13% to the holders of the Incentive Distribution Rights, Pro Rata; and (iii) to all Unitholders, Pro Rata, a percentage equal to 100% less the sum of the percentages applicable to subclauses (i) and (ii) of this clause (c), until there has been distributed in respect of each Unit then Outstanding an amount equal to the excess of the Second Target Distribution over the First Target Distribution for such Quarter;

(d) Fourth, (i) to the General Partner in accordance with its Percentage Interest; (ii) 23% to the holders of the Incentive Distribution Rights, Pro Rata; and (iii) to all Unitholders, Pro Rata, a percentage equal to 100% less the sum of the percentages applicable to subclauses (i) and (ii) of this clause (d), until there has been distributed in respect of each Unit then Outstanding an amount equal to the excess of the Third Target Distribution over the Second Target Distribution for such Quarter; and

(e) Thereafter, (i) to the General Partner in accordance with its Percentage Interest; (ii) 48% to the holders of the Incentive Distribution Rights, Pro Rata; and (iii) to all Unitholders, Pro Rata, a percentage equal to 100% less the sum of the percentages applicable to subclauses (i) and (ii) of this clause (e);

provided, however, that if the Minimum Quarterly Distribution, the First Target Distribution, the Second Target Distribution and the Third Target Distribution have been reduced to zero pursuant to the second sentence of Section 6.5, the distribution of Available Cash that is deemed to be Operating Surplus with respect to any Quarter will be made solely in accordance with Section 6.3(e). No distributions shall be made with respect to Preferred Units pursuant to this Section 6.3.

Section 6.4

Distributions of Available Cash from Capital Surplus.

Available Cash that is deemed to be Capital Surplus pursuant to the provisions of Section 6.2(a) shall, subject to Section 51 of the Marshall Islands Act and Section 16.3 in respect of any series of Preferred Units described therein, be distributed, unless the provisions of Section 6.2 require otherwise, 100% to the General Partner and the Unitholders (other than Preferred Unit Holders) in accordance with their respective Percentage Interests, until a hypothetical holder of a Common Unit acquired on the Closing Date has received with respect to such Common Unit, during the period since the Closing Date through such date, distributions of Available Cash that are deemed to be Capital Surplus in an aggregate amount equal to the Initial Unit Price. Thereafter and subject to Section 16.3, all Available Cash shall be distributed as if it were Operating Surplus and shall be distributed in accordance with Section 6.3.

- 36 -

Section 6.5

Adjustment of Minimum Quarterly Distribution and Target Distribution Levels.

The Minimum Quarterly Distribution, First Target Distribution, Second Target Distribution and Third Target Distribution 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. In the event of a distribution of Available Cash that is deemed to be from Capital Surplus, the then applicable Minimum Quarterly Distribution, First Target Distribution, Second Target Distribution and Third Target Distribution, shall be reduced in the same proportion that the distribution had to the fair market value of the Common Units prior to the announcement of the distribution. If the Common Units are publicly traded on a National Securities Exchange, the fair market value will be the Current Market Price before the ex-distribution date. If the Common Units are not publicly traded, the fair market value will be determined by the Board of Directors of the General Partner.

Section 6.6

Special Provisions Relating to the Holders of Incentive Distribution Rights.

Notwithstanding anything to the contrary set forth in this Agreement, the holders of the Incentive Distribution Rights (a) shall possess the rights and obligations provided in this Agreement with respect to a Limited Partner pursuant to Articles III and VII and (b) shall not (i) be entitled to vote on any matters requiring the approval or vote of the holders of Outstanding Units, except as provided by law, or (ii) be entitled to any distributions other than as provided in Sections 6.3(c), (d) and (e) and 12.4.

ARTICLE VII

MANAGEMENT AND OPERATION OF BUSINESS

Section 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 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 determines to be 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 (subject to Section 16.5(c)(ii) with respect to any Senior Securities), and the incurring of any other obligations;

- 37 -

(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, consolidation 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 and Article XIV);

(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(a), the lending of funds to other Persons (including other Group Members); the repayment or guarantee of obligations of 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 such non-recourse provision 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 insurance for the benefit of the Partnership Group, the Partners and Indemnitees;

(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, limited liability companies or other relationships (including the acquisition of interests in, and the contributions of property to, any Group Member from time to time) subject 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, arbitration or mediation and the incurring of legal expenses and the settling of claims and litigation;

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

- 38 -

(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 4.8);

(xiii) the purchase, sale or other acquisition or disposition of Partnership Securities (subject to Section 16.6(f)), or the issuance of options, rights, warrants and appreciation rights relating to Partnership Securities;

(xiv) the undertaking of any action in connection with the Partnership’s participation in any Group Member; and

(xv) the entering into of agreements with any of its Affiliates to render services to a Group Member or to itself in the discharge of its duties as General Partner of the Partnership.

(b) Notwithstanding any other provision of this Agreement, any Group Member Agreement, the Marshall Islands Act or any applicable law, rule or regulation, each of the Partners and each other Person who may acquire an interest in Partnership Securities hereby (i) approves, ratifies and confirms the execution, delivery and performance by the parties thereto of this Agreement, the Underwriting Agreement, the Omnibus Agreement, the Contribution Agreement, any Group Member Agreement of any other Group Member and the other agreements described in or filed as exhibits to the Registration Statement that are related to the transactions contemplated by the Registration Statement; (ii) agrees that the General Partner (on its own or on behalf 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 Registration 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 Partnership Securities; 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.

Section 7.2

Certificate of Limited Partnership.

The General Partner caused the Certificate of Limited Partnership to be filed with the Marshall Islands Registrar as required by the Marshall Islands Act. The General Partner shall use all commercially reasonable efforts to cause to be filed such other certificates or documents that the General Partner determines to be necessary or appropriate for the formation, continuation, qualification and operation of a limited partnership (or a partnership or other entity in which the limited partners have limited liability) in the Marshall Islands or any other jurisdiction in which the Partnership may elect to do business or own property. To the extent the General Partner determines such action to be necessary or appropriate, the General Partner shall file amendments to and restatements of the Certificate of Limited Partnership and do all things to

- 39 -

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 Marshall Islands or of any other jurisdiction 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.

Section 7.3

Restrictions on the General Partner’s Authority.

(a) Except as otherwise provided in this Agreement, 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.

(b) Except as provided in Articles XII and XIV, the General Partner may not sell, exchange or otherwise dispose of all or substantially all of the assets of the Partnership Group, taken as a whole, in a single transaction or a series of related transactions (including by way of merger, consolidation, other combination or sale of ownership interests in the Partnership’s Subsidiaries) without the approval of holders of a Unit Majority; 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. Without the approval of holders of a Unit Majority, the General Partner shall not, on behalf of the Partnership, except as permitted under Sections 4.6, 11.1 and 11.2, elect or cause the Partnership to elect a successor general partner of the Partnership.

Section 7.4

Reimbursement of the General Partner.

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

(b) The General Partner shall be reimbursed on a monthly basis, or such other basis as the General Partner may determine, for (i) all direct and indirect expenses it incurs or payments it makes on behalf of the Partnership Group (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 Group, which amounts shall also include reimbursement for any Common Units purchased to satisfy obligations of the Partnership under any of its equity compensation plans), and (ii) all other direct and indirect expenses allocable to the Partnership or otherwise incurred by the General Partner in connection with operating the Partnership Group’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 Group. 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.

- 40 -

(c) The General Partner and its Affiliates may charge any member of the Partnership Group a management fee to the extent necessary to allow the Partnership Group to reduce the amount of any U.S. federal, state or local or any non-U.S. franchise or income tax or any other tax based upon the revenues or gross margin of any member of the Partnership Group if the tax benefit produced by the payment of such management fee or fees exceeds the amount of such fee or fees.

(d) The General Partner, 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 or rights, warrants or appreciation rights relating to Partnership Securities), or cause the Partnership to issue Partnership Securities in connection with, or 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 thereof, 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 Affiliates are 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 Affiliates of Partnership Securities purchased by the General Partner or such Affiliates from the Partnership or in the open market 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.

Section 7.5

Outside Activities.

(a) After the Closing Date, 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 and any other partnership or limited liability company of which the Partnership is, directly or indirectly, a partner or member and to undertake activities that are ancillary or related thereto (including being a limited partner in the Partnership), (ii) shall not 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, if any, of one or more Group Members or as described in or contemplated by the Registration Statement or (B) the acquiring, owning or disposing of debt or equity securities in any Group Member and (iii) except to the extent permitted in the Omnibus Agreement, shall not, and shall cause its controlled Affiliates not to, engage in any LNG Restricted Business or Crude Oil Restricted Business (as such terms are defined in the Omnibus Agreement).

(b) Teekay Corporation, Teekay LNG Partners L.P. and certain of their respective Affiliates have entered into the Omnibus Agreement, which agreement sets forth certain restrictions on the ability of Teekay Corporation, Teekay LNG Partners L.P. and certain of their Affiliates to engage in any Offshore Restricted Business (as defined in the Omnibus Agreement).

- 41 -

(c) Except as specifically restricted by Section 7.5(a) or the Omnibus 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. Notwithstanding anything to the contrary in this Agreement, (i) the possessing of competitive interests and 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 any fiduciary duty or any other obligation of any type whatsoever of the General Partner or of any Indemnitee 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.

(d) Notwithstanding anything to the contrary in this Agreement, the doctrine of corporate opportunity, or any analogous doctrine, shall not apply to an Indemnitee (including the General Partner) and, subject to the terms of Section 7.5(a), Section 7.5(b), Section 7.5(c) and the Omnibus Agreement, no Indemnitee (including the General Partner) who acquires knowledge of a potential transaction, agreement, arrangement or other matter that may be an opportunity for the Partnership shall have any duty to communicate or offer such opportunity to the Partnership, and, subject to the terms of Section 7.5(a), Section 7.5(b), Section 7.5(c) and the Omnibus Agreement, such Indemnitee (including the General Partner) shall not be liable to the Partnership, to any Limited Partner or any other Person for breach of any fiduciary or other duty by reason of the fact that such Indemnitee (including the General Partner) pursues or acquires such opportunity for itself, directs such opportunity to another Person or does not communicate such opportunity or information to the Partnership.

(e) The General Partner and each of its Affiliates may acquire Units or other Partnership Securities in addition to those acquired on the Closing Date and, except as otherwise provided in this Agreement, shall be entitled to exercise, at their option, all rights relating to all Units or other Partnership Securities acquired by them. The term “Affiliates” as used in this Section 7.5(e) with respect to the General Partner shall not include any Group Member.

Section 7.6

Loans from the General Partner; Loans or Contributions from the Partnership or Group Members.

(a) The General Partner or any of its Affiliates 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

- 42 -

imposed on the borrowing party by unrelated lenders on comparable loans made on an arms’-length basis (without reference to the lending party’s financial abilities or guarantees), all as determined by the General Partner. 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.

(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 determined by the General Partner. No Group Member may lend funds to the General Partner or any of its Affiliates (other than another Group Member).

(c) No borrowing by any Group Member or the approval thereof by the General Partner shall be deemed to constitute a breach of any duty, expressed or implied, of the General Partner or its Affiliates to the Partnership or the Limited Partners 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.

Section 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 , however , that the Indemnitee shall not be 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 the Indemnitee is seeking indemnification pursuant to this Section 7.7, the Indemnitee acted in bad faith or engaged in fraud or willful misconduct or, in the case of a criminal matter, acted with knowledge that the Indemnitee’s conduct was unlawful; and, provided further, that no indemnification pursuant to this Section 7.7 shall be available to the General Partner or its Affiliates (other than a Group Member) with respect to its or their obligations incurred pursuant to the Underwriting Agreement, the Omnibus Agreement or the Contribution Agreement (other than obligations incurred by the General Partner on behalf of the Partnership). 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 a determination that the Indemnitee is not entitled to be indemnified upon

- 43 -

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, 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.

(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 the Indemnitee 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 the Indemnitee with respect to any employee benefit plan in the performance of its duties for a purpose reasonably believed by it to be in the best interest of the participants and beneficiaries of the plan shall be deemed to be for a purpose that is in 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.

- 44 -

Section 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 or any other Persons who have acquired interests in the Partnership Securities, for losses sustained or liabilities incurred as a result of any act or omission of an Indemnitee unless there has been a final and non-appealable judgment entered by a court of competent jurisdiction determining that, in respect of the matter in question, the Indemnitee acted in bad faith or engaged in fraud or willful misconduct or, in the case of a criminal matter, acted with knowledge that the Indemnitee’s conduct was criminal.

(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.

(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.

(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.

Section 7.9

Resolution of Conflicts of Interest; Standards of Conduct and Modification of Duties.

(a) Unless otherwise expressly provided in this Agreement or any Group Member 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, any Group Member or any Partner, 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 any Group Member Agreement, of any agreement contemplated herein or therein, 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 Special Approval, (ii) approved by the vote of a majority of the Outstanding Common Units (excluding Common Units owned by the General Partner and its Affiliates), (iii) on terms no less favorable to the Partnership than those generally being provided to or available from unrelated third parties or

- 45 -

(iv) fair and reasonable 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 shall be authorized but not required in connection with its resolution of such conflict of interest to seek Special Approval of such resolution, and the General Partner may also adopt a resolution or course of action that has not received Special Approval. If Special Approval is not sought and the Board of Directors of the General Partner determines that the resolution or course of action taken with respect to a conflict of interest satisfies either of the standards set forth in clauses (iii) or (iv) above, then it shall be presumed that, in making its decision, the Board of Directors of the General Partner acted in good faith, and in any proceeding brought by any Limited Partner or by or on behalf of such Limited Partner or any other Limited Partner or the Partnership challenging such approval, the Person bringing or prosecuting such proceeding shall have the burden of overcoming such presumption. Notwithstanding anything to the contrary in this Agreement, the existence of the conflicts of interest described in the Registration Statement are hereby approved by all Partners.

(b) Whenever the General Partner makes a determination or takes or declines to take any other action, or any of its Affiliates causes it to do so, in its capacity as the general partner of the Partnership as opposed to in its individual capacity, whether under this Agreement, any Group Member Agreement or any other agreement contemplated hereby or otherwise, then, unless another express standard is provided for in this Agreement, the General Partner, or such Affiliates causing it to do so, shall make such determination or take or decline to take such other action in good faith and shall not be subject to any other or different standards imposed by this Agreement, any Group Member Agreement, any other agreement contemplated hereby or under the Marshall Islands Act or any other law, rule or regulation or at equity. In order for a determination or other action to be in “good faith” for purposes of this Agreement, the Person or Persons making such determination or taking or declining to take such other action must reasonably believe that the determination or other action is in the best interests of the Partnership, unless the context otherwise requires.

(c) Whenever the General Partner makes a determination or takes or declines to take any other action, or any of its Affiliates causes it to do so, in its individual capacity as opposed to in its capacity as the general partner of the Partnership, whether under this Agreement, any Group Member Agreement or any other agreement contemplated hereby or otherwise, then the General Partner, or such Affiliates causing it to do so, are entitled to make such determination or to take or decline to take such other action free of any fiduciary duty or obligation whatsoever to the Partnership or any Limited Partner, and the General Partner, or such Affiliates causing it to do so, shall not be required to act in good faith or pursuant to any other standard imposed by this Agreement, any Group Member Agreement, any other agreement contemplated hereby or under the Marshall Islands Act or any other law, rule or regulation or at equity. By way of illustration and not of limitation, whenever the phrase, “at the option of the General Partner,” or some variation of that phrase, is used in this Agreement, it indicates that the General Partner is acting in its individual capacity. For the avoidance of doubt, whenever the General Partner votes or transfers its Units (including Common Units and any Preferred Units it may hold), General Partner Interest or Incentive Distribution Rights, to the extent permitted under this Agreement, or refrains from voting or transferring its Units (including Common Units and any Preferred Units it may hold), General Partner Units or Incentive Distribution Rights, as appropriate, it shall be acting in its individual capacity. The General Partner’s organizational documents may provide

- 46 -

that determinations to take or decline to take any action in its individual, rather than representative, capacity may or shall be determined by its members, if the General Partner is a limited liability company, stockholders, if the General Partner is a corporation, or the members or stockholders of the General Partner’s general partner, if the General Partner is a limited partnership.

(d) Notwithstanding anything to the contrary in this Agreement, the General Partner and its Affiliates shall have no duty or obligation, express or implied, to (i) sell or otherwise dispose of any asset of the Partnership Group other than in the ordinary course of business or (ii) 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. Any determination by the General Partner or any of its Affiliates to enter into such contracts shall be at its option.

(e) Except as expressly set forth in this Agreement, neither the General Partner nor any other Indemnitee shall have any duties or liabilities, including fiduciary duties, to the Partnership or any Limited Partner and the provisions of this Agreement, to the extent that they restrict, eliminate or otherwise modify the duties and liabilities, including fiduciary duties, of the General Partner or any other Indemnitee otherwise existing at law or in equity, are agreed by the Partners to replace such other duties and liabilities of the General Partner or such other Indemnitee. Notwithstanding anything to the contrary, but subject to Section 7.9(c) and without reference to the definition of “good faith” in Section 7.9(b), neither the General Partner nor any other Indemnitee shall owe any fiduciary duties to Preferred Unit Holders other than a contractual duty of good faith and fair dealing.

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

Section 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.

(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 advice or 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 advice or 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.

- 47 -

Section 7.11

Purchase or Sale of Partnership Securities.

Subject to Section 16.6(f), 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 or 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 Articles IV and X and Section 16.6(f).

Section 7.12

Registration Rights of the General Partner and its Affiliates.

(a) If (i) the General Partner or any Affiliate of the General Partner (including for purposes of this Section 7.12, any Person that is an Affiliate of the General Partner at the date hereof notwithstanding that it may later cease to be an Affiliate of the General Partner) holds Partnership Securities that it desires to sell and (ii) Rule 144 of the Securities Act (or any successor rule or regulation to Rule 144) or another exemption from registration is not available to enable such holder of Partnership Securities (the “Holder” ) to dispose of the number of Partnership Securities it desires to sell at the time it desires to do so without registration under the Securities Act, then at the option and upon the request of the Holder, the Partnership shall file with the Commission as promptly as practicable after receiving such request, and use all commercially reasonable efforts to cause to become effective and remain effective for a period of not less than six months following its effective date or such shorter period as shall terminate when all Partnership Securities covered by such registration statement have been sold, a registration statement under the Securities Act registering the offering and sale of the number of Partnership Securities specified by the Holder; provided , however , that the Partnership shall not be required to effect more than three registrations pursuant to this Section 7.12(a); and, provided further, that if the Conflicts Committee determines in good faith that the requested registration would be materially detrimental to the Partnership and its Partners because such registration would (x) materially interfere with a significant acquisition, reorganization or other similar transaction involving the Partnership, (y) require premature disclosure of material information that the Partnership has a bona fide business purpose for preserving as confidential or (z) render the Partnership unable to comply with requirements under applicable securities laws, then the Partnership shall have the right to postpone such requested registration for a period of not more than six months after receipt of the Holder’s request, such right pursuant to this Section 7.12(a) not to be utilized more than once in any 12-month period. Except as provided in the preceding sentence, the Partnership shall be deemed not to have used all commercially reasonable efforts to keep the registration statement effective during the applicable period if it voluntarily takes any action that would result in Holders of Partnership Securities covered thereby not being able to offer and sell such Partnership Securities at any time during such period, unless such action is required by applicable law. In connection with any registration pursuant to the immediately preceding sentence, the Partnership shall (i) promptly prepare and file (A) such documents as may be necessary to register or qualify the securities subject to such registration under the securities laws of such states as the Holder shall reasonably request (provided, however, that no such qualification shall be required in any jurisdiction where, as a result thereof, the Partnership would become subject to general service of process or to taxation or qualification to do business as a foreign corporation or partnership doing business in such jurisdiction solely as a result of such registration), and (B) such documents as may be necessary to apply for listing or to list the

- 48 -

Partnership Securities subject to such registration on such National Securities Exchange as the Holder shall reasonably request, and (ii) do any and all other acts and things that may be necessary or appropriate to enable the Holder to consummate a public sale of such Partnership Securities in such states. Except as set forth in Section 7.12(c), all costs and expenses of any such registration and offering (other than the underwriting discounts and commissions) shall be paid by the Partnership, without reimbursement by the Holder.

(b) If the Partnership shall at any time propose to file a registration statement under the Securities Act for an offering of Partnership Securities for cash (other than an offering relating solely to an employee benefit plan), the Partnership shall use all commercially reasonable efforts to include such number or amount of Partnership Securities held by any Holder in such registration statement as the Holder shall request; provided , however , that the Partnership is not required to make any effort or take any action to so include the Partnership Securities of the Holder once the registration statement becomes or is declared effective by the Commission, including any registration statement providing for the offering from time to time of Partnership Securities pursuant to Rule 415 of the Securities Act. If the proposed offering pursuant to this Section 7.12(b) shall be an underwritten offering, then, in the event that the managing underwriter or managing underwriters of such offering advise the Partnership and the Holder in writing that in their opinion the inclusion of all or some of the Holder’s Partnership Securities would adversely and materially affect the success of the offering, the Partnership shall include in such offering only that number or amount, if any, of Partnership Securities held by the Holder that, in the opinion of the managing underwriter or managing underwriters, will not so adversely and materially affect the offering. Except as set forth in Section 7.12(c), all costs and expenses of any such registration and offering (other than the underwriting discounts and commissions) shall be paid by the Partnership, without reimbursement by the Holder.

(c) If underwriters are engaged in connection with any registration referred to in this Section 7.12, the Partnership shall provide indemnification, representations, covenants, opinions and other assurance to the underwriters in form and substance reasonably satisfactory to such underwriters. Further, in addition to and not in limitation of the Partnership’s obligation under Section 7.7, the Partnership shall, to the fullest extent permitted by law, indemnify and hold harmless the Holder, its officers, directors and each Person who controls the Holder (within the meaning of the Securities Act) and any agent thereof (collectively, “Indemnified Persons” ) from and against any and all losses, claims, demands, actions, causes of action, assessments, damages, liabilities (joint or several), costs and expenses (including interest, penalties and reasonable attorneys’ fees and disbursements), resulting to, imposed upon, or incurred by the Indemnified Persons, directly or indirectly, under the Securities Act or otherwise (hereinafter referred to in this Section 7.12(c) as a “claim” and in the plural as “claims”) based upon, arising out of or resulting from any untrue statement or alleged untrue statement of any material fact contained in any registration statement under which any Partnership Securities were registered under the Securities Act or any state securities or Blue Sky laws, in any preliminary prospectus or issuer free writing prospectus as defined in Rule 433 of the Securities Act (if used prior to the effective date of such registration statement), or in any summary or final prospectus or in any amendment or supplement thereto (if used during the period the Partnership is required to keep the registration statement current), or arising out of, based upon or resulting from the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements made therein not misleading; provided , however , that the Partnership shall not be

- 49 -

liable to any Indemnified Person to the extent that any such claim arises out of, is based upon or results from an untrue statement or alleged untrue statement or omission or alleged omission made in such registration statement, such preliminary, summary or final prospectus or such amendment or supplement, in reliance upon and in conformity with written information furnished to the Partnership by or on behalf of such Indemnified Person specifically for use in the preparation thereof.

(d) The provisions of Section 7.12(a) and Section 7.12(b) shall continue to be applicable with respect to the General Partner (and any of the General Partner’s Affiliates) after it ceases to be a general partner of the Partnership, during a period of two years subsequent to the effective date of such cessation and for so long thereafter as is required for the Holder to sell all of the Partnership Securities with respect to which it has requested during such two-year period inclusion in a registration statement otherwise filed or that a registration statement be filed; provided , however , that the Partnership shall not be required to file successive registration statements covering the same Partnership Securities for which registration was demanded during such two-year period. The provisions of Section 7.12(c) shall continue in effect thereafter.

(e) The rights to cause the Partnership to register Partnership Securities pursuant to this Section 7.12 may be assigned (but only with all related obligations) by a Holder to a transferee or assignee of such Partnership Securities, provided (i) the Partnership is, within a reasonable time after such transfer, furnished with written notice of the name and address of such transferee or assignee and the Partnership Securities with respect to which such registration rights are being assigned, and (ii) such transferee or assignee agrees in writing to be bound by and subject to the terms set forth in this Section 7.12.

(f) Any request to register Partnership Securities pursuant to this Section 7.12 shall (i) specify the Partnership Securities intended to be offered and sold by the Person making the request, (ii) express such Person’s present intent to offer such Partnership Securities for distribution, (iii) describe the nature or method of the proposed offer and sale of Partnership Securities, and (iv) contain the undertaking of such Person to provide all such information and materials and take all action as may be required in order to permit the Partnership to comply with all applicable requirements in connection with the registration of such Partnership Securities.

Section 7.13

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

- 50 -

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, its officers 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.

ARTICLE VIII

BOOKS, RECORDS, ACCOUNTING AND REPORTS

Section 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 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 , however , 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.

Section 8.2

Fiscal Year.

The fiscal year of the Partnership shall be a fiscal year ending December 31.

Section 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 made available, by any reasonable means (including posting on the Partnership’s website), to each Record Holder of a Unit as of a date selected by the General Partner, 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 fiscal year, the General Partner shall cause to be mailed or made available, by any reasonable means (including posting on the Partnership’s website), to each Record Holder of a Unit, as of a date selected by the General Partner, 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 the Units are listed or admitted to trading, or as the General Partner determines to be necessary or appropriate.

- 51 -

ARTICLE IX

TAX MATTERS

Section 9.1

Tax Elections and Information.

(a) The Partnership has elected to be treated as an association taxable as a corporation for United States federal income tax purposes. Except as otherwise provided herein, the General Partner shall determine whether the Partnership should make any other elections permitted by the Code.

(b) The tax information reasonably required by Record Holders generally for United States 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.

Section 9.2

Withholding.

Notwithstanding any other provision of this Agreement, the General Partner is authorized to take any action that may be required to cause the Partnership and other Group Members to comply with any withholding requirements established under the Code or any other U.S. federal, state or local or any non-U.S. law including pursuant to Sections 1441, 1442 and 1445 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 distribution of income to any Partner, the General Partner may treat the amount withheld as a distribution of cash pursuant to Section 6.2 in the amount of such withholding from such Partner.

Section 9.3

Conduct of Operations.

The General Partner shall use commercially reasonable efforts to conduct the business of the Partnership and its Affiliates in a manner that does not require a holder of Common Units or Preferred Units to file a tax return in any jurisdiction with which the holder has no contact other than through ownership of Common Units or Preferred Units.

For greater certainty, the General Partner shall conduct the affairs and governance of the Partnership so that the General Partner and the Partnership are not residents of Canada for purposes of Canada’s tax legislation and neither the General Partner nor the Partnership is carrying on business in Canada for purposes of such legislation.

ARTICLE X

ADMISSION OF PARTNERS

Section 10.1

Admission of Initial Limited Partners.

Upon the issuance by the Partnership of Partnership Securities to the General Partner, Teekay Corporation and the Underwriters as described in Sections 5.1(b), 5.2 and 5.3, the General Partner admitted such parties to the Partnership as Initial Limited Partners in respect of the Partnership Securities issued to them.

- 52 -

Section 10.2

Admission of Additional Limited Partners.

(a) By acceptance of the transfer of any Limited Partner Interests in accordance with Article IV or the acceptance of any Limited Partner Interests issued pursuant to Article V or pursuant to a merger or consolidation pursuant to Article XIV, each transferee of, or other such Person acquiring, a Limited Partner Interest (including any nominee holder or an agent or representative acquiring such Limited Partner Interests for the account of another Person) (i) shall be admitted to the Partnership as a Limited Partner with respect to the Limited Partner Interests so transferred or issued to such Person when any such transfer, issuance or admission is reflected in the books and records of the Partnership and such Limited Partner becomes the Record Holder of the Limited Partner Interests so transferred, (ii) shall become bound by the terms of this Agreement, (iii) represents that the transferee has the capacity, power and authority to enter into this Agreement, (iv) grants the powers of attorney set forth in this Agreement and (v) makes the consents and waivers contained in this Agreement, all with or without execution of this Agreement by such Person. The transfer of any Limited Partner Interests and the admission of any new Limited Partner shall not constitute an amendment to this Agreement. A Person may become a Limited Partner or Record Holder of a Limited Partner Interest without the consent or approval of any of the Partners. A Person may not become a Limited Partner until such Person acquires a Limited Partner Interest and such Person is reflected in the books and records of the Partnership as the Record Holder of such Limited Partner Interest.

(b) The name and mailing address of each Limited Partner shall be listed on the books and records of the Partnership maintained for such purpose by the Partnership or the Transfer Agent. The General Partner shall update the books and records of the Partnership from time to time as necessary to reflect accurately the information therein (or shall cause the Transfer Agent to do so, as applicable). A Limited Partner Interest may be represented by a Certificate, as provided in Section 4.1 hereof.

(c) Any transfer of a Limited Partner Interest shall not entitle the transferee to receive distributions or to any other rights to which the transferor was entitled until the transferee becomes a Limited Partner pursuant to Section 10.1(a).

Section 10.3

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 (represented by General Partner Units) 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 predecessor or transferring General Partner, pursuant to Section 11.1 or 11.2 or the transfer of the General Partner Interest (represented by General Partner Units) 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 members of the Partnership Group without dissolution.

- 53 -

Section 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 or appropriate under the Marshall Islands 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

Section 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 other Partners;

(ii) The General Partner transfers all of its rights as General Partner 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 petition in bankruptcy; (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), (B) or (C) of this Section 11.1(a)(iv); or (E) seeks, consents to or acquiesces in the appointment of a trustee, receiver or liquidator of the General Partner or of all or any substantial part of its properties;

(v) The General Partner is adjudged bankrupt or insolvent, or has entered against it an order for relief in any bankruptcy or insolvency proceeding;

(vi) (A) in the event the General Partner is a corporation, the filing of a certificate of dissolution, or its equivalent, for the corporation or the revocation of its charter and the expiration of ninety (90) days after the date of notice to the corporation of revocation without a reinstatement of its charter; (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; (D) in the event the General Partner is a natural person, his death or adjudication of incompetency; and (E) otherwise in the event of the termination of the General Partner.

- 54 -

If an Event of Withdrawal specified in Section 11.1(a)(iv), (v) or (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) the General Partner voluntarily withdraws by giving at least 90 days’ advance notice to the Unitholders, such withdrawal to take effect on the date specified in such notice; or (ii) 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. 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, if any, to the extent applicable, 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 Unit Majority, 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 the successor general partner or managing member, to the extent applicable, of the other Group Members of which the General Partner is a general partner or a managing member. If, prior to the effective date of the General Partner’s withdrawal a successor is not selected by the Unitholders as provided herein, 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 10.3.

Section 11.2

Removal of the General Partner.

The General Partner may be removed if such removal is approved by the Unitholders holding at least 66 2/3% of the Outstanding Common Units (including Common Units held by the General Partner and its Affiliates voting as a single class). Any such action by such holders for removal of the General Partner must also provide for the election of a successor General Partner by the Unitholders holding a majority of the Outstanding Common Units voting as a class (including Common Units held by the General Partner and its Affiliates). Such removal shall be effective immediately following the admission of a successor General Partner pursuant to Section 10.3. The removal of the General Partner shall also automatically constitute the removal of the General Partner as general partner or managing member, to the extent applicable, of the other Group Members of which the General Partner is a general partner or a managing member. 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 10.3, automatically become a successor general partner or managing member, to the extent applicable, of the other Group Members of which the General Partner is a general partner or a managing member. The right of the holders of Outstanding Common Units to remove the General Partner shall not exist or be exercised unless the Partnership has received an Opinion of Counsel that such removal (following the selection of the successor General Partner) would not result in the loss of the limited liability of any Limited Partner or any Group Member. Any successor General Partner elected in accordance with the terms of this Section 11.2 shall be subject to the provisions of Section 10.3.

- 55 -

Section 11.3

Interest of Departing General Partner and Successor General Partner.

(a) In the event of (i) withdrawal of the General Partner under circumstances where such withdrawal does not violate this Agreement or (ii) removal of the General Partner by the holders of Outstanding Common Units under circumstances where Cause does not exist, if the successor General Partner is elected in accordance with the terms of Section 11.1 or 11.2, the Departing General Partner shall have the option, exercisable prior to the effective date of the departure of such Departing General Partner, to require its successor to purchase its General Partner Interest (represented by General Partner Units) and its general partner interest (or equivalent interest), if any, in the other Group Members and all of the Incentive Distribution Rights (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 Unitholders under circumstances where Cause exists or if the General Partner withdraws under circumstances where such withdrawal violates this Agreement, and if a successor General Partner is elected in accordance with the terms of Section 11.1 or 11.2 (or if the business of the Partnership is continued pursuant to Section 12.2 and the successor General Partner is not the former General Partner), such successor shall have the option, exercisable prior to the effective date of the departure of such Departing General Partner (or, in the event the business of the Partnership is continued, prior to the date the business of the Partnership is continued), to purchase the Combined Interest for such fair market value of such Combined Interest of the Departing General Partner. In either event, the Departing General Partner shall be entitled to receive all reimbursements due such Departing General 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 Departing General Partner for the benefit of the Partnership or the other Group Members.

For purposes of this Section 11.3(a), the fair market value of the Departing General Partner’s Combined Interest shall be determined by agreement between the Departing General Partner and its successor or, failing agreement within 30 days after the effective date of such Departing General Partner’s departure, by an independent investment banking firm or other independent expert selected by the Departing General 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 General Partner shall designate an independent investment banking firm or other independent expert, the Departing General 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 of the Departing General Partner. In making its determination, such third independent investment banking firm or other independent expert may consider the then current trading price of Units on any National Securities Exchange on which Units are then listed or admitted to trading, the value of the Partnership’s assets, the rights and obligations of the Departing General Partner and other factors it may deem relevant.

- 56 -

(b) If the Combined Interest is not purchased in the manner set forth in Section 11.3(a), the Departing General Partner (or its transferee) shall become a Limited Partner and its Combined Interest shall be converted into Common Units pursuant to a valuation made by an investment banking firm or other independent expert selected pursuant to Section 11.3(a), without reduction in such Partnership Interest (but subject to proportionate dilution by reason of the admission of its successor). Any successor General Partner shall indemnify the Departing General Partner (or its transferee) as to all debts and liabilities of the Partnership arising on or after the date on which the Departing General Partner (or its transferee) becomes a Limited Partner. For purposes of this Agreement, conversion of the Combined Interest of the Departing General Partner to Common Units will be characterized as if the Departing General Partner (or its transferee) contributed its Combined Interest to the Partnership in exchange for the newly issued Common Units.

(c) If a successor General Partner is elected in accordance with the terms of Section 11.1 or 11.2 (or if the Partnership is continued pursuant to Section 12.2 and the successor General Partner is not the former General Partner) and the option described in Section 11.3(a) is not exercised by the party entitled to do so, the successor General Partner shall, at the effective date of its admission to the Partnership, contribute to the Partnership cash in the amount equal to the product of the Percentage Interest of the Departing General Partner and the Net Agreed Value of the Partnership’s assets on such date. In such event, such successor General Partner shall, subject to the following sentence, be entitled to its Percentage Interest of all Partnership allocations and distributions to which the Departing General Partner was entitled. In addition, the successor General Partner shall cause this Agreement to be amended to reflect that, from and after the date of such successor General Partner’s admission, the successor General Partner’s interest in all Partnership distributions and allocations shall be its Percentage Interest.

Section 11.4

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

Section 12.1

Dissolution.

The Partnership shall not be dissolved by the admission of 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 Sections 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) an election to dissolve the Partnership by the General Partner that is approved by the holders of a Unit Majority;

- 57 -

(b) at any time there are no Limited Partners, unless the Partnership is continued without dissolution in accordance with the Marshall Islands Act;

(c) the entry of a decree of judicial dissolution of the Partnership pursuant to the provisions of the Marshall Islands Act; or

(d) 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 Sections 11.1(b) or 11.2 and such successor is admitted to the Partnership pursuant to Section 10.3.

Section 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 Sections 11.1(a)(i) or (iii) and the failure of the Partners to select a successor to such Departing General Partner pursuant to Sections 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 Sections 11.1(a)(iv), (v) or (vi), then, to the maximum extent permitted by law, within 180 days thereafter, the holders of a Unit Majority may elect to continue the business of the Partnership on the same terms and conditions set forth in this Agreement by appointing as a successor General Partner a Person approved by the holders of a Unit Majority. 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:

(i) the Partnership shall continue without dissolution unless earlier dissolved in accordance with this Article XII;

(ii) 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 11.3; and

(iii) the successor General Partner shall be admitted to the Partnership as General Partner, effective as of the Event of Withdrawal, by agreeing in writing to be bound by this Agreement; provided , however , that the right of the holders of a Unit Majority 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 the exercise of the right would not result in the loss of limited liability of any Limited Partner.

Section 12.3

Liquidator.

Upon dissolution of the Partnership, unless the business of the Partnership is continued 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

- 58 -

compensation for its services as may be approved by holders of a majority of the Outstanding Common Units voting as a single class. 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 holders of a majority of the Outstanding Common Units voting as a single class. 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 holders of a majority of the Outstanding Common Units voting as a single class. 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)) necessary or appropriate to carry out the duties and functions of the Liquidator hereunder for and during the period of time required to complete the winding up and liquidation of the Partnership as provided for herein.

Section 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 determined by the Liquidator, subject to Section 60 of the Marshall Islands Act and the following:

(a) 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 defer liquidation or distribution of the Partnership’s assets for a reasonable time if it determines that an immediate sale or distribution of all or some of the Partnership’s assets would be impractical or would cause undue loss to the Partners. The Liquidator may 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) Liabilities of the Partnership include amounts owed to the Liquidator as compensation for serving in such capacity (subject to the terms of Section 12.3) and amounts to Partners otherwise than in respect of their distribution rights under Articles VI and XVI, as applicable. 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 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.

- 59 -

(c) All property and all cash in excess of that required to discharge liabilities as provided in Section 12.4(b) shall be distributed, subject to Section 16.4 in respect of any series of Preferred Units described therein, as follows:

(i) If the Current Market Price of the Common Units as of the date three trading days prior to the announcement of the proposed liquidation exceeds the Unrecovered Capital for a Common Unit:

(A) First, (x) to the General Partner in accordance with its Percentage Interest and (y) to all the Unitholders holding Common Units, Pro Rata, a percentage equal to 100% less the General Partner’s Percentage Interest, until there has been distributed in respect of each Common Unit then Outstanding an amount equal to such Current Market Price of a Common Unit; and

(B) Thereafter (x) to the General Partner in accordance with its Percentage Interest, (y) 48% to the holders of the Incentive Distribution Rights, Pro Rata, and (z) to all Unitholders holding Common Units, Pro Rata, a percentage equal to 100% less the sum of the percentages applicable to subclauses (x) and (y) of this clause (i)(B); and

(ii) If the Current Market Price of a Common Unit as of the date three trading days prior to the announcement of the proposed liquidation is equal to or less than the Unrecovered Capital for a Common Unit:

(B) Thereafter, (x) to the General Partner in accordance with its Percentage Interest; (y) 48% to the holders of the Incentive Distribution Rights, Pro Rata; and (z) to all Unitholders holding Common Units, Pro Rata, a percentage equal to 100% less the sum of the percentages applicable to subclauses (x) and (y) of this clause (ii)(B).

Distributions with respect to any series of Preferred Units described in Article XVI in connection with a liquidation or dissolution of the Partnership shall be made pursuant to Section 16.4, rather than pursuant to clause (i) or (ii) of this Section 12.4(c).

Section 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 Certificate of Limited Partnership and all qualifications of the Partnership as a foreign limited partnership in jurisdictions other than the Marshall Islands shall be canceled and such other actions as may be necessary to terminate the Partnership shall be taken.

- 60 -

Section 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 Unitholders, or any portion thereof, it being expressly understood that any such return shall be made solely from Partnership assets.

Section 12.7

Waiver of Partition.

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

ARTICLE XIII

AMENDMENT OF PARTNERSHIP AGREEMENT; MEETINGS; RECORD DATE

Section 13.1

Amendments to be Adopted Solely by the General Partner.

Each Partner agrees that the General Partner, without the approval of any Partner, 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 the General Partner determines to be necessary or appropriate 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 the Marshall Islands or to ensure that the Group Members will not be treated as associations taxable as corporations or otherwise taxed as entities for Marshall Islands income tax purposes;

(d) subject to Section 16.5, to the extent applicable, a change that the General Partner determines (i) does not adversely affect the Limited Partners (including any particular class or series of Partnership Interests as compared to other classes or series of Partnership Interests) in any material respect, (ii) to be necessary or appropriate to (A) satisfy any requirements, conditions or guidelines contained in any opinion, directive, order, ruling or regulation of any Marshall Islands authority (including the Marshall Islands Act) or (B) facilitate the trading of the Units (including the division of any class, classes or series of Outstanding Units into different classes or series to facilitate uniformity of tax consequences within such classes or series of Units) or comply with any rule, regulation, guideline or requirement of any National Securities Exchange on which the Units are or will be listed, (iii) to be necessary or appropriate in connection with action taken by the General Partner pursuant to Section 5.8 or (iv) is required to effect the intent expressed in the Registration Statement or the intent of the provisions of this Agreement or is otherwise contemplated by this Agreement;

- 61 -

(e) a change in the fiscal year or taxable year of the Partnership and any other changes that the General Partner determines to be necessary or appropriate 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 (other than Preferred Unit 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 U.S. Investment Company Act of 1940, as amended, the U.S. Investment Advisers Act of 1940, as amended, or “plan asset” regulations adopted under the U.S. Employee Retirement Income Security Act of 1974, as amended, regardless of whether such regulations are substantially similar to plan asset regulations currently applied or proposed by the United States Department of Labor;

(g) subject to Section 16.5, an amendment that the General Partner determines to be necessary or appropriate in connection with the authorization of issuance of any class or series of Partnership Securities pursuant to Section 5.5;

(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 the General Partner determines to be necessary or appropriate to reflect and account for the formation by the Partnership of, or investment by the Partnership in, any corporation, partnership, joint venture, limited liability company or other Person, in connection with the conduct by the Partnership of activities permitted by the terms of Section 2.4;

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

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

Section 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 the General Partner; provided , however , that the General Partner shall have no duty or obligation to propose any amendment to this Agreement and may decline to do so free of any fiduciary duty or obligation whatsoever to the Partnership or any Limited Partner and, in declining to propose an amendment, to the fullest extent permitted by applicable law shall not be required to act in good faith or pursuant to any other standard imposed by this Agreement, any Group Member Agreement, any other agreement contemplated hereby or under the Marshall Islands Act or any other law, rule or regulation. Subject to Section 16.5, to the extent applicable, a proposed amendment shall be effective upon its approval by the General Partner and the holders of a Unit Majority, unless a greater or different percentage is required under this Agreement or by the Marshall Islands Act. Each proposed amendment that requires the approval

- 62 -

of the holders of a specified percentage of Outstanding Units 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 Units or call a meeting of the Unitholders to consider and vote on such proposed amendment. The General Partner shall notify all Record Holders upon final adoption of any such proposed amendments.

Section 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 Units (including Units 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 Units whose aggregate Outstanding Units 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 enlargement 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 consent may be given or withheld at the General Partner’s option, (iii) change Section 12.1(a), or (iv) change the term of the Partnership or, except as set forth in Section 12.1(a), give any Person the right to dissolve the Partnership.

(c) Except as provided in Section 14.3 and subject to Section 16.5(c)(i) with respect to the applicable series of Preferred Units described therein, and without limitation of the General Partner’s authority to adopt amendments to this Agreement without the approval of any Partners as contemplated in Section 13.1, any amendment that would have a material adverse effect on the rights or preferences of any class or series of Partnership Interests in relation to other classes or series of Partnership Interests must be approved by the holders of not less than a majority of the Outstanding Partnership Interests of the class or series affected.

(d) Notwithstanding any other provision of this Agreement, except for amendments pursuant to Section 13.1 and except as otherwise provided by Section 14.3(b), no amendments shall become effective without the approval of the holders of at least 90% of the Outstanding Units voting as a single class 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 at least 90% of the Outstanding Units.

Section 13.4

Special Meetings.

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

- 63 -

the General Partner or by Limited Partners owning 20% or more of the Outstanding Units of the class, classes or series for which a meeting is proposed. 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 Marshall Islands Act or the law of any other jurisdiction in which the Partnership is qualified to do business.

Section 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, classes or series of Units for which a meeting is proposed in writing by mail or other means of written communication in accordance with Section 17.1. 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.

Section 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 the Units are listed or admitted to trading, in which case the rule, regulation, guideline or requirement of such National Securities 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. If the General Partner does not set a Record Date, then (a) the Record Date for determining the Limited Partners entitled to notice of or to vote at a meeting of the Limited Partners shall be the close of business on the day next preceding the day on which notice is given, and (b) the Record Date for determining the Limited Partners entitled to give approvals without a meeting shall be the date the first written approval is deposited with the Partnership in care of the General Partner in accordance with Section 13.11.

Section 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

- 64 -

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.

Section 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 it had occurred at a meeting duly held after regular call and notice, if a quorum is present either in person or by proxy. Attendance of a Limited Partner at a meeting shall constitute a waiver of notice of the meeting, except when the Limited Partner attends the meeting for the express purpose of objecting, at the beginning of the meeting, to 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.

Section 13.9

Quorum and Voting.

The holders of a majority of the Outstanding Units of the class, classes or series for which a meeting has been called (including Outstanding Units deemed owned by the General Partner) represented in person or by proxy shall constitute a quorum at a meeting of Limited Partners of such class, classes or series unless any such action by the Limited Partners requires approval by holders of a greater percentage of such Units, in which case the quorum shall be such greater percentage. At any meeting of the Limited Partners duly called and held in accordance with this Agreement at which a quorum is present, the act of Limited Partners holding Outstanding Units that in the aggregate represent a majority of the Outstanding Units 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 Units 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 Units specified in this Agreement (including Outstanding Units deemed owned by the General Partner). 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 a majority of the Outstanding Units entitled to vote at such meeting (including Outstanding Units deemed owned by the General Partner) represented either in person or by proxy, but no other business may be transacted, except as provided in Section 13.7.

Section 13.10

Conduct of a Meeting.

The General Partner shall have full power and authority concerning the manner of conducting any meeting of the Limited Partners or solicitation of approvals in writing, including the determination of Persons entitled to vote, the existence of a quorum, the satisfaction of the

- 65 -

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 Limited 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.

Section 13.11

Action Without a Meeting.

If authorized by the General Partner, 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 Units (including Units 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 the Units are listed or admitted to trading, in which case the rule, regulation, guideline or requirement of such National Securities Exchange shall govern). Prompt notice of the taking of action without a meeting shall be given to the Limited Partners who have not approved the action 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 Units held by the Limited Partners, the Partnership shall be deemed to have failed to receive a ballot for the Units 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 applicable statutes then governing the rights, duties and liabilities of the Partnership and the Partners.

Section 13.12

Right to Vote and Related Matters.

(a) Only those Record Holders of the Units on the Record Date set pursuant to Section 13.6 (and also subject to the limitations contained in the definition of “Outstanding” ) 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 Units 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 Units shall be deemed to be references to the votes or acts of the Record Holders of such Outstanding Units.

- 66 -

(b) With respect to Units 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 Units are registered, such other Person shall, in exercising the voting rights in respect of such Units on any matter, and unless the arrangement between such Persons provides otherwise, vote such Units 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

Section 14.1

Authority.

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

Section 14.2

Procedure for Merger or Consolidation.

Merger or consolidation of the Partnership pursuant to this Article XIV requires the prior consent of the General Partner; provided , however , that, to the fullest extent permitted by law, the General Partner shall have no duty or obligation to consent to any merger or consolidation of the Partnership and may decline to do so free of any fiduciary duty or obligation whatsoever to the Partnership or any Limited Partner and, in declining to consent to a merger or consolidation, shall not be required to act in good faith or pursuant to any other standard imposed by this Agreement, any Group Member Agreement, any other agreement contemplated hereby or under the Marshall Islands Act or any other law, rule or regulation or at equity. If the General Partner shall determine 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” );

(d) the manner and basis of exchanging or converting the equity securities of each constituent business entity for, or into, cash, property or interests, rights, securities or obligations of the Surviving Business Entity; and (i) if any general or limited partner interests, securities or

- 67 -

rights of any constituent business entity are not to be exchanged or converted solely for, or into, cash, property or 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 general or limited partnership, corporation, trust, limited liability company, unincorporated business or other Person (other than the Surviving Business Entity) which the holders of such interests, securities or rights are to receive in exchange for, or upon conversion of their interests, securities or rights, and (ii) in the case of securities represented by certificates, upon the surrender of such certificates, which cash, property or interests, rights, securities or obligations of the Surviving Business Entity or any general or limited partnership, corporation, trust, limited liability company, unincorporated business or other Person (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 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 such certificate of merger, the effective time shall be fixed at a date or time certain at or prior to the time of the filing of such certificate of merger and stated therein); and

(g) such other provisions with respect to the proposed merger or consolidation that the General Partner determines to be necessary or appropriate.

Section 14.3

Approval by Limited Partners of Merger or Consolidation.

(a) Except as provided in Sections 14.3(d) and 14.3(e), the General Partner, upon its approval of the Merger Agreement, shall direct that the Merger Agreement be submitted to a vote of 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 Sections 14.3(d) and 14.3(e), the Merger Agreement shall be approved upon receiving the affirmative vote or consent of the holders of a Unit Majority.

(c) Except as provided in Sections 14.3(d) and 14.3(e), 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, without Limited Partner approval, to convert the Partnership or any Group Member into a new limited liability entity, to merge the Partnership or any Group Member into, or convey all of the Partnership’s assets to, another limited liability entity which

- 68 -

shall be newly formed and shall have no assets, liabilities or operations at the time of such conversion, merger or conveyance 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 conversion, merger or conveyance, as the case may be, would not result in the loss of the limited liability of any Limited Partner, (ii) the sole purpose of such conversion, 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.

(e) Additionally, notwithstanding anything else contained in this Article XIV or in this Agreement, the General Partner is permitted, without Limited Partner approval, to merge or consolidate the Partnership with or into another entity if (i) the General Partner has received an Opinion of Counsel that the merger or consolidation, as the case may be, would not result in the loss of the limited liability of any Limited Partner, (ii) the merger or consolidation would not result in an amendment to this Agreement, other than any amendments that could be adopted pursuant to Section 13.1, (iii) the Partnership is the Surviving Business Entity in such merger or consolidation, (iv) each Unit outstanding immediately prior to the effective date of the merger or consolidation is to be an identical Unit of the Partnership after the effective date of the merger or consolidation, and (v) the number of Partnership Securities to be issued by the Partnership in such merger or consolidation does not exceed 20% of the Partnership Securities Outstanding immediately prior to the effective date of such merger or consolidation.

Section 14.4

Certificate of Merger.

Upon the required approval by the General Partner and the Unitholders of a Merger Agreement, a certificate of merger shall be executed and filed in conformity with the requirements of the Marshall Islands Act.

Section 14.5

Amendment of Partnership Agreement.

Pursuant to Section 20(2) of the Marshall Islands Act, an agreement of merger or consolidation approved in accordance with Section 20(2) of the Marshall Islands Act may (a) effect any amendment to this Agreement or (b) effect the adoption of a new partnership agreement for a limited partnership if it is the Surviving Business Entity. Any such amendment or adoption made pursuant to this Section 14.5 shall be effective at the effective time or date of the merger or consolidation.

Section 14.6

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;

- 69 -

(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.

(b) A merger or consolidation effected pursuant to this Article 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

Section 15.1

Right to Acquire Limited Partner Interests.

(a) Notwithstanding any other provision of this Agreement, if at any time the General Partner and its Affiliates hold more than 80% of the total Limited Partner Interests of any class or series then Outstanding, 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 Affiliate of the General Partner, exercisable at its option, to purchase all, but not less than all, of such Limited Partner Interests of such class or series then Outstanding held by Persons other than the General Partner and its Affiliates, 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 or any of its Affiliates for any such Limited Partner Interest of such class or series purchased during the 90-day period preceding the date that the notice described in Section 15.1(b) is mailed. Notwithstanding the foregoing, the repurchase right described in this Article XV shall not apply to Preferred Units.

(b) If the General Partner, any Affiliate of the General Partner or the Partnership 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 or series (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, its Affiliate or the Partnership, as the case may be, elects to purchase such Limited Partner Interests, upon surrender of Certificates representing such Limited Partner Interests 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

- 70 -

Exchange on which such Limited Partner Interests are listed. 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, its Affiliate or the Partnership, 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 shall not have been surrendered for purchase, all rights of the holders of such Limited Partner Interests (including any rights pursuant to Articles IV, V, VI and XII) shall thereupon cease, except the right to receive the applicable 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 representing such Limited Partner Interests, and such Limited Partner Interests shall thereupon be deemed to be transferred to the General Partner, its Affiliate or the Partnership, as the case may be, on the record books of the Transfer Agent and the Partnership, and the General Partner or any Affiliate 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 Articles IV, V, VI and 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 to the Transfer Agent in exchange for payment of the amount described in Section 15.1(a), without interest thereon.

ARTICLE XVI

SERIES A, SERIES B AND SERIES E CUMULATIVE REDEEMABLE PREFERRED UNITS

Section 16.1

Designations.

(a) On April 23, 2013, the General Partner designated and created a series of Preferred Units designated as “7.25% Series A Cumulative Redeemable Preferred Units,” and fixed the preferences, rights, powers and duties of the holders of the Series A Preferred Units as set forth in this Article XVI. Each Series A Preferred Unit shall be identical in all respects to every other Series A Preferred Unit, except as to the respective dates from which the Series A Liquidation Preference shall increase or from which Series A Distributions may begin accruing, to the extent such dates may differ. The Series A Preferred Units represent perpetual equity interests in the Partnership and shall not give rise to a claim by the holder for redemption thereof at a particular date.

(b) On April 13, 2015, the General Partner designated and created a series of Preferred Units designated as “8.50% Series B Cumulative Redeemable Preferred Units,” and fixed the preferences, rights, powers and duties of the holders of the Series B Preferred Units as

- 71 -

set forth in this Article XVI. Each Series B Preferred Unit shall be identical in all respects to every other Series B Preferred Unit, except as to the respective dates from which the Series B Liquidation Preference shall increase or from which Series B Distributions may begin accruing, to the extent such dates may differ. The Series B Preferred Units represent perpetual equity interests in the Partnership and shall not give rise to a claim by the holder for redemption thereof at a particular date.

(c) The General Partner hereby designates and creates a series of Preferred Units to be designated as “8.875% Series E Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units,” and fixed the preferences, rights, powers and duties of the holders of the Series E Preferred Units as set forth in this Article XVI. Each Series E Preferred Unit shall be identical in all respects to every other Series E Preferred Unit, except as to the respective dates from which the Series E Liquidation Preference shall increase or from which Series E Distributions may begin accruing, to the extent such dates may differ. The Series E Preferred Units represent perpetual equity interests in the Partnership and shall not give rise to a claim by the holder for redemption thereof at a particular date.

Section 16.2

Units.

(a) The authorized number of Series A Preferred Units, of Series B Preferred Units and of Series E Preferred Units shall each be unlimited. Series A Preferred Units, Series B Preferred Units or Series E Preferred Units that are purchased or otherwise acquired by the Partnership shall be cancelled.

(b) The Series A Preferred Units, the Series B Preferred Units and the Series E Preferred Units shall, as to each such series of Preferred Units, be represented by a single Certificate registered in the name of the Depository or its nominee, and no Series A Holder, Series B Holder or Series E Holder shall be entitled to receive a Certificate evidencing such applicable Units, unless otherwise required by law or the Depository gives notice of its intention to resign or is no longer eligible to act as such with respect to such series of Preferred Units and the Partnership shall have not selected a substitute Depository within 60 calendar days thereafter. So long as the Depository shall have been appointed and is serving with respect to such series of Preferred Units, payments and communications made by the Partnership to Series A Holders, Series B Holders or Series E Holders shall be made by making payments to, and communicating with, the Depository.

Section 16.3

Distributions.

(a) Distributions on each Series A Preferred Unit shall be cumulative and shall accrue at the Series A Distribution Rate from the Series A Original Issue Date (or, for any subsequently issued and newly Outstanding Series A Preferred Units, from the Series A Distribution Payment Date immediately preceding the issuance date of such Units) until such time as the Partnership pays the Series A Distribution or redeems the Series A Preferred Units in full in accordance with Section 16.6 below, whether or not such Series A Distributions shall have been declared. Distributions on each Series B Preferred Unit shall be cumulative and shall accrue at the Series B Distribution Rate from the Series B Original Issue Date (or, for any subsequently issued and newly Outstanding Series B Preferred Units, from the Series B Distribution Payment Date

- 72 -

immediately preceding the issuance date of such Units) until such time as the Partnership pays the Series B Distribution or redeems the Series B Preferred Units in full in accordance with Section 16.6 below, whether or not such Series B Distributions shall have been declared. Distributions on each Series E Preferred Unit shall be cumulative and shall accrue at the applicable Series E Distribution Rate from the Series E Original Issue Date (or, for any subsequently issued and newly Outstanding Series E Preferred Units, from the Series E Distribution Payment Date immediately preceding the issuance date of such Units) until such time as the Partnership pays the Series E Distribution or redeems the Series E Preferred Units in full in accordance with Section 16.6 below, whether or not such Series E Distributions shall have been declared. Series A Holders, Series B Holders and Series E Holders shall be entitled to receive Series A Distributions, Series B Distributions or Series E Distributions, as applicable, from time to time out of any assets of the Partnership legally available for the payment of distributions at the Series A Distribution Rate per Series A Preferred Unit, at the Series B Distribution Rate per Series B Preferred Unit, or at the applicable Series E Distribution Rate per Series E Preferred Unit, as applicable, in each case when, as, and if declared by the General Partner. Distributions, to the extent declared by the General Partner to be paid by the Partnership in accordance with this Section 16.3, shall be paid quarterly on each Series A Distribution Payment Date, Series B Distribution Payment Date or Series E Distribution Payment Date, as applicable. Distributions shall accumulate in each Series A Distribution Period from and including the preceding Series A Distribution Payment Date (other than the initial Series A Distribution Period, which shall commence on and include the Series A Original Issue Date), to but excluding the next Series A Distribution Payment Date for such Series A Distribution Period, and distributions shall accrue on accumulated Series A Distributions at the Series A Distribution Rate. Distributions shall accumulate in each Series B Distribution Period from and including the preceding Series B Distribution Payment Date (other than the initial Series B Distribution Period, which shall commence on and include the Series B Original Issue Date), to but excluding the next Series B Distribution Payment Date for such Series B Distribution Period, and distributions shall accrue on accumulated Series B Distributions at the Series B Distribution Rate. Distributions shall accumulate in each Series E Distribution Period from and including the preceding Series E Distribution Payment Date (other than the initial Series E Distribution Period, which shall commence on and include the Series E Original Issue Date), to but excluding the next Series E Distribution Payment Date for such Series E Distribution Period, and distributions shall accrue on accumulated Series E Distributions at the applicable Series E Distribution Rate. If any Series A Distribution Payment Date, Series B Distribution Payment Date or Series E Distribution Payment Date (during the Series E Fixed Rate Period) otherwise would occur on a date that is not a Business Day, declared Series A Distributions, Series B Distributions or Series E Distributions, as applicable, shall be paid on the immediately succeeding Business Day without the accumulation of additional distributions. Series A Distributions and Series B Distributions shall be payable based on a 360-day year consisting of twelve 30-day months. Series E Distributions for any Series E Distribution Period during the Series E Fixed Rate Period shall be payable based on a 360-day year consisting of twelve 30-day months and Series E Distributions for any Series E Distribution Period during the Series E Floating Rate Period shall be payable based on a 360-day year and the number of days actually elapsed during such Series E Distribution Period.

(b) Not later than 5:00 p.m., New York City time, on each Series A Distribution Payment Date, Series B Distribution Payment Date and Series E Distribution Payment Date, the

- 73 -

Partnership shall pay those Series A Distributions, Series B Distributions or Series E Distributions, if any, that shall have been declared by the General Partner to Series A Holders, Series B Holders or Series E Holders, as applicable, on the Record Date for the applicable Series A Preferred Distribution, Series B Preferred Distribution or Series E Preferred Distribution. The Record Date (the “Series A Distribution Record Date” ) for the payment of any Series A Distributions shall be the fifth Business Day immediately preceding the applicable Series A Distribution Payment Date, except that in the case of payments of Series A Distributions in arrears, the Series A Distribution Record Date with respect to a Series A Distribution Payment Date shall be such date as may be designated by the General Partner in accordance with this Article XVI. The Record Date (the “ Series B Distribution Record Date ”) for the payment of any Series B Distributions shall be the fifth Business Day immediately preceding the applicable Series B Distribution Payment Date, except that in the case of payments of Series B Distributions in arrears, the Series B Distribution Record Date with respect to a Series B Distribution Payment Date shall be such date as may be designated by the General Partner in accordance with this Article XVI. The Record Date (the “ Series E Distribution Record Date ”) for the payment of any Series E Distributions shall be the fifth Business Day immediately preceding the applicable Series E Distribution Payment Date, except that in the case of payments of Series E Distributions in arrears, the Series E Distribution Record Date with respect to a Series E Distribution Payment Date shall be such date as may be designated by the General Partner in accordance with this Article XVI. No distribution shall be declared or paid or set apart for payment on any Junior Securities (other than a distribution payable solely in Junior Securities) unless full cumulative Series A Distributions, Series B Distributions and Series E Distributions have been or contemporaneously are being paid or provided for on all Outstanding Series A Preferred Units, Series B Preferred Units, Series E Preferred Units and any other Parity Securities through the most recent respective Series A Distribution Payment Dates, Series B Distribution Payments Dates and Series E Distribution Payment Dates. Accumulated Series A Distributions, accumulated Series B Distributions or accumulated Series E Distributions in arrears for any past Series A Distribution Period, Series B Distribution Period or Series E Distribution Period, as applicable, may be declared by the General Partner and paid on any date fixed by the General Partner, whether or not a Series A Distribution Payment Date, Series B Distribution Payment Date or a Series E Distribution Payment Date, to Series A Holders, Series B Holders or Series E Holders, as applicable, on the record date for such payment, which may not be more than 60 days, nor less than 15 days, before such payment date. Subject to the next succeeding sentence, if all accumulated Series A Distributions, Series B Distributions and Series E Distributions in arrears on all Outstanding Series A Preferred Units, Series B Preferred Units, Series E Preferred Units and any other Parity Securities shall not have been declared and paid, or if sufficient funds for the payment thereof shall not have been set apart, payment of accumulated distributions in arrears on the Series A Preferred Units, Series B Preferred Units, Series E Preferred Units and any such Parity Securities shall be made in order of their respective distribution payment dates, commencing with the earliest. If less than all distributions payable with respect to all Series A Preferred Units, Series B Preferred Units, Series E Preferred Units and any other Parity Securities are paid, any partial payment shall be made pro rata with respect to the Series A Preferred Units, Series B Preferred Units, Series E Preferred Units and any such other Parity Securities entitled to a distribution payment at such time in proportion to the aggregate distribution amounts remaining due in respect of such Series A Preferred Units, Series B Preferred Units, Series E Preferred Units and such other Parity Securities at such time. Subject

- 74 -

to Sections 12.4 and 16.6, none of the Series A Holders, Series B Holders or Series E Holders shall be entitled to any distribution, whether payable in cash, property or stock, in excess of full cumulative Series A Distributions, Series B Distributions or Series E Distributions, as applicable. Except insofar as distributions accrue on the amount of any accumulated and unpaid Series A Distributions, Series B Distributions or Series E Distributions, as applicable, as described in Section 16.3(a), no interest or sum of money in lieu of interest shall be payable in respect of any distribution payment which may be in arrears on the Series A Preferred Units, the Series B Preferred Units or the Series E Preferred Units. So long as the Series A Preferred Units, Series B Preferred Units or Series E Preferred Units, as applicable, are held of record by the nominee of the Depository, declared Series A Distributions, Series B Distributions or Series E Distributions shall be paid to the Depository in same-day funds on each Series A Distribution Payment Date, Series B Distribution Payment Date or Series E Distribution Payment Date, as applicable.

Section 16.4

Liquidation Rights.

(a) Upon the occurrence of any Liquidation Event, Series A Holders, Series B Holders and Series E Holders shall be entitled to receive out of the assets of the Partnership or proceeds thereof legally available for distribution to the Partners, (i) after satisfaction of all liabilities, if any, to creditors of the Partnership, (ii) after all applicable distributions of such assets or proceeds being made to or set aside for the holders of any Senior Securities then Outstanding in respect of such Liquidation Event, (iii) concurrently with any applicable distributions of such assets or proceeds being made to or set aside for holders of any Series A Preferred Units, Series B Preferred Units, Series E Preferred Units or other Parity Securities then Outstanding in respect of such Liquidation Event and (iv) before any distribution of such assets or proceeds is made to or set aside for the holders of Common Units and any other classes or series of Junior Securities as to such distribution, a liquidating distribution or payment in full redemption of such Series A Preferred Units, Series B Preferred Units or Series E Preferred Units in an amount equal to the Series A Liquidation Preference, the Series B Liquidation Preference or the Series E Liquidation Preference, as applicable. For purposes of clarity, upon the occurrence of any Liquidation Event, (x) the holders of then Outstanding Senior Securities shall be entitled to receive the applicable Liquidation Preference on such Senior Securities before any distribution shall be made with respect to the Series A Preferred Units, the Series B Preferred Units, the Series E Preferred Units or any Parity Securities and (y) the Series A Holders shall be entitled to the Series A Liquidation Preference per Series A Preferred Unit in cash, the Series B Holders shall be entitled to the Series B Liquidation Preference per Series B Preferred Unit in cash and the Series E Holders shall be entitled to the Series E Liquidation Preference per Series E Preferred Unit in cash, in each case concurrently with any distribution made to the holders of any Parity Securities and before any distribution shall be made to the holders of Common Units or any other Junior Securities. Series A Holders, Series B Holders and Series E Holders shall not be entitled to any other amounts from the Partnership, in their capacities as Series A Holders, Series B Holders or Series E Holders, as applicable, after they have received the Series A Liquidation Preference, the Series B Liquidation Preference or the Series E Liquidation Preference, as applicable. The payment of the Series A Liquidation Preference, Series B Liquidation Preference or Series E Liquidation Preference shall be a payment in redemption of the Series A Preferred Units, the Series B Preferred Units or the Series E Preferred Units, as applicable, such that, from and after payment of the full Series A Liquidation Preference, Series B Liquidation Preference or Series E Liquidation Preference, any such Series A Preferred Unit, Series B Preferred Unit or Series E Preferred Unit, as applicable, shall thereafter be cancelled and no longer be Outstanding.

- 75 -

(b) If, in the event of any distribution or payment described in Section 16.4(a) above where the Partnership’s assets available for distribution to holders of the Outstanding Series A Preferred Units, Series B Preferred Units, Series E Preferred Units and any other Parity Securities are insufficient to satisfy the applicable Liquidation Preference for such Series A Preferred Units, Series B Preferred Units, Series E Preferred Units and Parity Securities, the Partnership’s then remaining assets or proceeds thereof legally available for distribution to unitholders of the Partnership shall be distributed among the holders of Outstanding Series A Preferred Units, Series B Preferred Units, Series E Preferred Units and such Parity Securities, as applicable, ratably on the basis of their relative aggregate Liquidation Preferences. To the extent that the Series A Holders, Series B Holders or Series E Holders receive a partial payment of their Series A Liquidation Preference, Series B Liquidation Preference or Series E Liquidation Preference, as applicable, such partial payment shall reduce the Series A Liquidation Preference of their Series A Preferred Units, the Series B Liquidation Preference of their Series B Preferred Units, or the Series E Liquidation Preference of their Series E Preferred Units, as applicable, but only to the extent of such amount paid.

(c) After payment of the applicable Liquidation Preference to the holders of the Outstanding Series A Preferred Units, Series B Preferred Units, Series E Preferred Units and any other Parity Securities, the Partnership’s remaining assets and funds shall be distributed among the holders of the Common Units and any other Junior Securities then Outstanding according to their respective rights and preferences.

Section 16.5

Voting Rights.

(a) Notwithstanding anything to the contrary in this Agreement, none of the Series A Preferred Units, the Series B Preferred Units or the Series E Preferred Units shall have any voting rights except as set forth in Section 13.3(d), this Section 16.5 or as otherwise provided by the Marshall Islands Act.

(b) In the event that six quarterly Series A Distributions, whether consecutive or not, are in arrears, the Series A Holders shall have the right, voting as a class together with holders of any other Parity Securities upon which like voting rights have been conferred and are exercisable, at a meeting of the General Partner called for such purpose within 30 days after receipt by the General Partner of a request by Series A Holders holding a majority of the Outstanding Series A Preferred Units, to elect one member of the Board of Directors of the General Partner, and the size of the Board of Directors of the General Partner shall be increased as needed to accommodate such change; provided, however, that such right of the Series A Holders shall not apply to the election of another director if (i) Series A Holders and holders of Parity Securities upon which like voting rights have been conferred, voting as a class, have previously elected a member of the Board of Directors of the General Partner and (ii) such director continues then to serve on the Board of Directors. Such right of such Series A Holders to elect a member of the Board of Directors of the General Partner shall continue until the Partnership pays in full, or declares and sets aside funds for the payment of, all Series A Distributions accumulated and in arrears on the Series A Preferred Units, at which time such

- 76 -

right shall terminate, subject to the revesting of such right in the event of each and every subsequent failure to pay six quarterly Series A Distributions as described above in this Section 16.5(b). In the event that six quarterly Series B Distributions, whether consecutive or not, are in arrears, the Series B Holders shall have the right, voting as a class together with holders of any other Parity Securities upon which like voting rights have been conferred and are exercisable, at a meeting of the General Partner called for such purpose within 30 days after receipt by the General Partner of a request by Series B Holders holding a majority of the Outstanding Series B Preferred Units, to elect one member of the Board of Directors of the General Partner, and the size of the Board of Directors of the General Partner shall be increased as needed to accommodate such change; provided, however, that such right of the Series B Holders shall not apply to the election of another director if (i) Series B Holders and holders of Parity Securities upon which like voting rights have been conferred, voting as a class, have previously elected a member of the Board of Directors of the General Partner and (ii) such director continues then to serve on the Board of Directors. Such right of such Series B Holders to elect a member of the Board of Directors of the General Partner shall continue until the Partnership pays in full, or declares and sets aside funds for the payment of, all Series B Distributions accumulated and in arrears on the Series B Preferred Units, at which time such right shall terminate, subject to the revesting of such right in the event of each and every subsequent failure to pay six quarterly Series B Distributions as described above in this Section 16.5(b). In the event that six quarterly Series E Distributions, whether consecutive or not, are in arrears, the Series E Holders shall have the right, voting as a class together with holders of any other Parity Securities upon which like voting rights have been conferred and are exercisable, at a meeting of the General Partner called for such purpose within 30 days after receipt by the General Partner of a request by Series E Holders holding a majority of the Outstanding Series E Preferred Units, to elect one member of the Board of Directors of the General Partner, and the size of the Board of Directors of the General Partner shall be increased as needed to accommodate such change; provided, however, that such right of the Series E Holders shall not apply to the election of another director if (i) Series E Holders and holders of Parity Securities upon which like voting rights have been conferred, voting as a class, have previously elected a member of the Board of Directors of the General Partner and (ii) such director continues then to serve on the Board of Directors. Such right of such Series E Holders to elect a member of the Board of Directors of the General Partner shall continue until the Partnership pays in full, or declares and sets aside funds for the payment of, all Series E Distributions accumulated and in arrears on the Series E Preferred Units, at which time such right shall terminate, subject to the revesting of such right in the event of each and every subsequent failure to pay six quarterly Series E Distributions as described above in this Section 16.5(b). Upon any termination of the right of the Series A Holders, the Series B Holders, the Series E Holders and, if applicable, holders of any other Parity Securities to vote as a class for such director, the term of office of the director then in office elected by such Series A Holders, Series B Holders, Series E Holders and holders of any other Parity Securities voting as a class shall terminate immediately. Any director elected by the Series A Holders, the Series B Holders, the Series E Holders and, if applicable, holders of any other Parity Securities shall be entitled to one vote on any matter before the Board of Directors of the General Partner.

- 77 -

(c)

(i) Unless the General Partner shall have received the affirmative vote or consent of the holders of at least 66 2/3% of the Outstanding Series A Preferred Units, voting as a separate class, the General Partner shall not adopt any amendment to this Agreement that would have a material adverse effect on the existing terms of the Series A Preferred Units. Unless the General Partner shall have received the affirmative vote or consent of the holders of at least 66 2/3% of the Outstanding Series B Preferred Units, voting as a separate class, the General Partner shall not adopt any amendment to this Agreement that would have a material adverse effect on the existing terms of the Series B Preferred Units. Unless the General Partner shall have received the affirmative vote or consent of the holders of at least 66 2/3% of the Outstanding Series E Preferred Units, voting as a separate class, the General Partner shall not adopt any amendment to this Agreement that would have a material adverse effect on the existing terms of the Series E Preferred Units.

(ii) Unless the General Partner shall have received the affirmative vote or consent of the holders of at least 66 2/3% of the Outstanding Series A Preferred Units, Series B Preferred Units and Series E Preferred Units, voting as a class together with holders of any other Parity Securities upon which like voting rights have been conferred and are exercisable, the Partnership shall not (x) issue any Parity Securities if the cumulative distributions payable on Outstanding Series A Preferred Units, Series B Preferred Units or Series E Preferred Units are in arrears or (y) create or issue any Senior Securities.

(d) For any matter described in this Section 16.5 in which the Series A Holders, Series B Holders or Series E Holders are entitled to vote as a class (whether separately or together with the holders of any Parity Securities), such Series A Holders, Series B Holders or Series E Holders shall be entitled to one vote per Series A Preferred Unit, Series B Preferred Unit or Series E Preferred Unit, as applicable. Any Series A Preferred Units, Series B Preferred Units or Series E Preferred Units held by the Partnership or any of its subsidiaries or Affiliates shall not be entitled to vote.

Section 16.6

Optional Redemption.

The Partnership shall have the right at any time, and from time to time, on or after April 30, 2018 to redeem the Series A Preferred Units, in whole or in part, from any source of funds legally available for such purpose. Any such redemption shall occur on a date set by the General Partner (the “Series A Redemption Date” ). The Partnership shall have the right at any time, and from time to time, on or after April 20, 2020 to redeem the Series B Preferred Units, in whole or in part, from any source of funds legally available for such purpose. Any such redemption shall occur on a date set by the General Partner (the “ Series B Redemption Date ”). The Partnership shall have the right at any time, and from time to time, on or after February 15, 2025 to redeem the Series E Preferred Units, in whole or in part, from any source of funds legally available for such purpose. Any such redemption shall occur on a date set by the General Partner (the “ Series E Redemption Date ”).

(a) The Partnership shall effect any such redemption by paying cash for each Series A Preferred Unit, Series B Preferred Unit or Series E Preferred Unit, as applicable, to be redeemed equal to (i) the Series A Liquidation Preference for such Series A Preferred Unit on such Series A Redemption Date (the “Series A Redemption Price” ), (ii) the Series B Liquidation

- 78 -

Preference for such Series B Preferred Unit on such Series B Redemption Date (the “ Series B Redemption Price ”), or (iii) the Series E Liquidation Preference for such Series E Preferred Unit on such Series E Redemption Date (the “ Series E Redemption Price ”). So long as the Series A Preferred Units, Series B Preferred Units or Series E Preferred Units to be redeemed are held of record by the nominee of the Depository, the Series A Redemption Price, Series B Redemption Price or Series E Redemption Price, as applicable, shall be paid by the Paying Agent to the Depository on the Series A Redemption Date, the Series B Redemption Date or the Series E Redemption Price, as applicable.

(b) The Partnership shall give notice of any redemption by mail, postage prepaid, not less than 30 days and not more than 60 days before the scheduled Series A Redemption Date, Series B Redemption Date or Series E Redemption Date, to the Series A Holders, Series B Holders or Series E Holders, as applicable (as of 5:00 p.m. New York City time on the Business Day next preceding the day on which notice is given) of any Series A Preferred Units, Series B Preferred Units or Series E Preferred Units to be redeemed as such Series A Holders’, Series B Holders’ or Series E Holders’ names appear on the books of the Transfer Agent and at the address of such Series A Holders, Series B Holders or Series E Holders shown therein. Such notice (the “Series A Redemption Notice,” the “Series B Redemption Notice” or the “Series E Redemption Notice ”, as applicable) shall state, as applicable: (1) the Series A Redemption Date, Series B Redemption Date or Series E Redemption Date, (2) the number of Series A Preferred Units, Series B Preferred Units or Series E Preferred Units to be redeemed and, if less than all Outstanding Series A Preferred Units, Series B Preferred Units or Series E Preferred Units are to be redeemed, the number (and the identification) of Units to be redeemed from such Series A Holder, Series B Holder or Series E Holder, (3) the Series A Redemption Price, Series B Redemption Price or Series E Redemption Price, as applicable, (4) the place where the Series A Preferred Units, Series B Preferred Units or Series E Preferred Units are to be redeemed and shall be presented and surrendered for payment of the Series A Redemption Price, Series B Redemption Price or Series E Redemption Price therefor and (5) that distributions on the Units to be redeemed shall cease to accumulate from and after such Series A Redemption Date, Series B Redemption Date or Series E Redemption Date, as applicable.

(c) If the Partnership elects to redeem less than all of the Outstanding Series A Preferred Units, Series B Preferred Units or Series E Preferred Units, as applicable, the number of Series A Preferred Units, Series B Preferred Units or Series E Preferred Units to be redeemed shall be determined by the General Partner, and such Series A Preferred Units, Series B Preferred Units or Series E Preferred Units, as applicable, shall be redeemed by such method of selection as the Depository shall determine either Pro Rata or by lot, with adjustments to avoid redemption of fractional Series A Preferred Units, Series B Preferred Units or Series E Preferred Units. The aggregate Series A Redemption Price, Series B Redemption Price or Series E Redemption Price for any such partial redemption of the Outstanding Series A Preferred Units, Series B Preferred Units or Series E Preferred Units shall be allocated correspondingly among the redeemed Series A Preferred Units, Series B Preferred Units or Series E Preferred Units, as applicable. The Series A Preferred Units, Series B Preferred Units or Series E Preferred Units not redeemed shall remain Outstanding and entitled to all the rights and preferences provided in this Article XVI.

- 79 -

(d) If the Partnership gives or causes to be given a Series A Redemption Notice, Series B Redemption Notice or Series E Redemption Notice, the Partnership shall deposit with the Paying Agent funds, sufficient to redeem the Series A Preferred Units, Series B Preferred Units or Series E Preferred Units, as applicable, as to which such Series A Redemption Notice, Series B Redemption Notice or Series E Redemption Notice shall have been given, no later than 5:00 p.m. New York City time on the Business Day immediately preceding the Series A Redemption Date, Series B Redemption Date or Series E Redemption Date, and shall give the Paying Agent irrevocable instructions and authority to pay the Series A Redemption Price to the Series A Holders, the Series B Redemption Price to the Series B Holders and the Series E Redemption Price to the Series E Holders to be redeemed upon surrender or deemed surrender (which shall occur automatically if the Certificate representing such Series A Preferred Units, Series B Preferred Units or Series E Preferred Units, as applicable, is issued in the name of the Depository or its nominee) of the Certificates therefor as set forth in the Series A Redemption Notice, Series B Redemption Notice or Series E Redemption Notice. If the Series A Redemption Notice, Series B Redemption Notice or Series E Redemption Notice, as applicable, shall have been given, from and after the Series A Redemption Date, Series B Redemption Date or Series E Redemption Date, as applicable, unless the Partnership defaults in providing funds sufficient for such redemption at the time and place specified for payment pursuant to the Series A Redemption Notice, Series B Redemption Notice or Series E Redemption Notice, all Series A Distributions on such Series A Preferred Units to be redeemed, Series B Distributions on such Series B Preferred Units to be redeemed and/or Series E Distributions on such Series E Preferred Units to be redeemed, as applicable, shall cease to accumulate and all rights of holders of such Series A Preferred Units, Series B Preferred Units or Series E Preferred Units as Limited Partners with respect to such Series A Preferred Units, Series B Preferred Units or Series E Preferred Units to be redeemed shall cease, except the right to receive the Series A Redemption Price, Series B Redemption Price or Series E Redemption Price, as applicable, and such Series A Preferred Units, Series B Preferred Units or Series E Preferred Units shall not thereafter be transferred on the books of the Transfer Agent or be deemed to be Outstanding for any purpose whatsoever. The Partnership shall be entitled to receive from the Paying Agent the interest income, if any, earned on such funds deposited with the Paying Agent (to the extent that such interest income is not required to pay the Series A Redemption Price of the Series A Preferred Units, the Series B Redemption Price of the Series B Preferred Units or the Series E Redemption Price of the Series E Preferred Units, as applicable, to be redeemed), and the holders of any Series A Preferred Units, Series B Preferred Units or Series E Preferred Units so redeemed shall have no claim to any such interest income. Any funds deposited with the Paying Agent hereunder by the Partnership for any reason, including redemption of Series A Preferred Units, Series B Preferred Units or Series E Preferred Units, that remain unclaimed or unpaid after two years after the applicable Series A Redemption Date, Series B Redemption Date or Series E Redemption Date or other payment date, as applicable, shall be, to the extent permitted by law, repaid to the Partnership upon its written request, after which repayment the Series A Holders, Series B Holders or Series E Holders entitled to such redemption or other payment shall have recourse only to the Partnership. Notwithstanding any Series A Redemption Notice, Series B Redemption Notice or Series E Redemption Notice, there shall be no redemption of any Series A Preferred Units, Series B Preferred Units or Series E Preferred Units, as applicable, called for redemption until funds sufficient to pay the full Series A Redemption Price of such Series A Preferred Units, the full Series B Redemption Price of such Series B Preferred Units or the full Series E Redemption Price of such Series E Preferred Units, as applicable, shall have been deposited by the Partnership with the Paying Agent.

- 80 -

(e) Any Series A Preferred Units, Series B Preferred Units or Series E Preferred Units that are redeemed or otherwise acquired by the Partnership shall be canceled. If only a portion of the Series A Preferred Units, Series B Preferred Units or Series E Preferred Units represented by a Certificate shall have been called for redemption, upon surrender of the Certificate to the Paying Agent (which shall occur automatically if the Certificate representing such Series A Preferred Units, Series B Preferred Units or Series E Preferred Units is registered in the name of the Depository or its nominee), the Paying Agent shall issue to the Series A Holders, Series B Holders or Series E Holders, as applicable, a new Certificate (or adjust the applicable book-entry account) representing the number of Series A Preferred Units, Series B Preferred Units or Series E Preferred Units represented by the surrendered Certificate that have not been called for redemption.

(f) Notwithstanding anything to the contrary in this Article XVI, in the event that full cumulative distributions on the Series A Preferred Units, Series B Preferred Units, Series E Preferred Units and any other Parity Securities shall not have been paid or declared and set apart for payment, none of the Partnership, the General Partner or any Affiliate of the General Partner shall be permitted to repurchase, redeem or otherwise acquire, in whole or in part, any Series A Preferred Units, Series B Preferred Units, Series E Preferred Units or other Parity Securities except pursuant to a purchase or exchange offer made on the same terms to all Series A Holders, Series B Holders, Series E Holders and holders of any other Parity Securities. None of the Partnership, the General Partner or any Affiliate of the General Partner shall be permitted to redeem, repurchase or otherwise acquire any Common Units or any other Junior Securities unless full cumulative distributions on the Series A Preferred Units, Series B Preferred Units, Series E Preferred Units and any other Parity Securities for all prior and the then-ending Series A Distribution Periods, Series B Distribution Periods and Series E Distribution Periods shall have been paid or declared and set apart for payment.

Section 16.7

Rank.

The Series A Preferred Units, Series B Preferred Units and Series E Preferred Units shall each be deemed to rank:

(a) Senior to (i) the Common Units and (ii) any other class or series of Partnership Securities established after the Series A Original Issue Date by the General Partner, the terms of which class or series do not expressly provide that it is made senior to or on parity with the Series A Preferred Units, Series B Preferred Units or Series E Preferred Units as to distributions and distributions upon any Liquidation Event (collectively referred to with the Partnership’s Common Units as “Junior Securities” );

(b) On a parity with each other and with any other class or series of Partnership Securities established after the Series A Original Issue Date by the General Partner, the terms of which class or series are not expressly subordinated or senior to the Series A Preferred Units, Series B Preferred Units or Series E Preferred Units as to distributions and distributions upon any Liquidation Event (collectively referred to as “Parity Securities” ); and

- 81 -

(c) Junior to any class or series of Partnership Securities established after the Series A Original Issue Date by the General Partner, the terms of which class or series expressly provide that it ranks senior to the Series A Preferred Units, Series B Preferred Units and Series E Preferred Units as to distributions and distributions upon any Liquidation Event (collectively referred to as “Senior Securities” ).

The Partnership may issue Junior Securities and, subject to any approvals required by Series A Holders, Series B Holders and Series E Holders pursuant to Section 16.5(c)(ii), Parity Securities from time to time in one or more classes or series without the consent of the Series A Holders, Series B Holders or Series E Holders, as applicable. The General Partner has the authority to determine the preferences, powers, qualifications, limitations, restrictions and special or relative rights or privileges, if any, of any such class or series before the issuance of any Partnership Securities of such class or series.

Section 16.8

No Sinking Fund.

None of the Series A Preferred Units, the Series B Preferred Units or the Series E Preferred Units shall have the benefit of any sinking fund.

Section 16.9

Record Holders.

To the fullest extent permitted by applicable law, the General Partner, Partnership, the Registrar, the Transfer Agent and the Paying Agent may deem and treat any Series A Holder, Series B Holder and Series E Holder as the true, lawful and absolute owner of the applicable Series A Preferred Units, Series B Preferred Units or Series E Preferred Units for all purposes, and neither the General Partner, the Partnership nor the Registrar, the Transfer Agent or the Paying Agent shall be affected by any notice to the contrary.

Section 16.10

Notices.

All notices or communications in respect of the Series A Preferred Units, Series B Preferred Units or Series E Preferred Units shall be sufficiently given if given in writing and delivered in person or by first class mail, postage prepaid, or if given in such other manner as may be permitted in this Article XVI, this Agreement or by applicable law.

Section 16.11

Other Rights; Fiduciary Duties.

None of the Series A Preferred Units, the Series B Preferred Units or the Series E Preferred Units shall have any voting powers, preferences or relative, participating, optional or other special rights, or qualifications, limitations or restrictions thereof, other than as set forth in this Article XVI or as provided by applicable law. Notwithstanding anything to the contrary in this Agreement, but subject to Section 7.9(c) and without reference to the definition of “good faith” in Section 7.9(b), neither the General Partner nor any other Indemnitee shall owe any fiduciary duties to Series A Holders, Series B Holders or Series E Holders, other than a contractual duty of good faith and fair dealing.

- 82 -

ARTICLE XVII

GENERAL PROVISIONS

Section 17.1

Addresses and Notices.

Any notice, demand, request, report or proxy materials required or permitted to be given or made to a Partner 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 at the address described below. Any notice, payment or report to be given or made to a Partner 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 Securities 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 Securities 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 17.1 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 Postal Service 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 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. 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 or other Person if believed by it to be genuine.

Section 17.2

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.

Section 17.3

Binding Effect.

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

- 83 -

Section 17.4

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, including the Prior Agreement.

Section 17.5

Creditors.

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

Section 17.6

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.

Section 17.7

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, pursuant to Section 10.2(a) without execution hereof.

Section 17.8

Applicable Law.

This Agreement shall be construed in accordance with and governed by the laws of the Marshall Islands, without regard to the principles of conflicts of law.

Section 17.9

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.

Section 17.10

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.

- 84 -

Section 17.11

Facsimile Signatures.

The use of facsimile signatures affixed in the name and on behalf of the transfer agent and registrar of the Partnership on Certificates representing Common Units and Preferred Units is expressly permitted by this Agreement.

Section 17.12

Third-Party Beneficiaries.

Each Partner agrees that any Indemnitee shall be entitled to assert rights and remedies hereunder as a third-party beneficiary hereto with respect to those provisions of this Agreement affording a right, benefit or privilege to such Indemnitee.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

- 85 -

IN WITNESS WHEREOF , the parties hereto have executed this Sixth Amended and Restated Agreement of Limited Partnership as of the date first written above.


GENERAL PARTNER:

Teekay Offshore GP L.L.C.

By:		/s/ Edith Robinson
Name:		Edith Robinson
Title:		Secretary

LIMITED PARTNERS:

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

Teekay Offshore GP L.L.C.

By:		/s/ Edith Robinson
Name:		Edith Robinson
Title:		Secretary

[SIGNATURE PAGE CONTINUES ON NEXT PAGE]

- 86 -


ACKNOWLEDGED AND AGREED FOR PURPOSES OF SECTION 16.5(b):

Teekay Holdings Limited, as a member of the General Partner, to evidence its agreement to modify the governing documents of the General Partner at such time and in such manner as may be required from time to time by Section 16.5(b)

By:		/s/ Edith Robinson
Name:		Edith Robinson
Title:		Secretary

Brookfield TK TOGP L.P., as a member of the General Partner, to evidence its agreement to modify the governing documents of the General Partner at such time and in such manner as may be required from time to time by Section 16.5(b)

By: Brookfield Capital Partners (Bermuda) Ltd., its general partner

By:		/s/ Anna Knapman-Scott
Name:		Anna Knapman-Scott
Title:		Assistant Secretary

- 87 -

EXHIBIT A

to the Sixth Amended and Restated

Agreement of Limited Partnership of

Teekay Offshore Partners L.P.

Certificate Evidencing Common Units

Representing Limited Partner Interests in

Teekay Offshore Partners L.P.


No.		Common Units

In accordance with Section 4.1 of the Sixth Amended and Restated Agreement of Limited Partnership of Teekay Offshore Partners L.P., as amended, supplemented or restated from time to time (the “Partnership Agreement” ), Teekay Offshore Partners L.P., a Marshall Islands limited partnership (the “Partnership” ), hereby certifies that (the “Holder” ) is the registered owner of Common Units representing limited partner interests in the Partnership (the “Common Units” ) transferable on the books of the Partnership, in person or by duly authorized attorney, upon surrender of this Certificate properly endorsed. The rights, preferences and limitations of the Common Units are set forth in, and this Certificate and the Common Units represented hereby are issued and shall in all respects be subject to the terms and provisions of, the Partnership Agreement. Copies of the Partnership Agreement are on file at, and will be furnished without charge on delivery of written request to the Partnership at, the principal office of the Partnership located at 4th Floor, Belvedere Building, 69 Pitts Bay Road, Hamilton, HM 08, Bermuda. Capitalized terms used herein but not defined shall have the meanings given them in the Partnership Agreement.

The Holder, by accepting this Certificate, is deemed to have (i) requested admission as, and agreed to become, a Limited Partner and to have agreed to comply with and be bound by and to have executed the Partnership Agreement, (ii) represented and warranted that the Holder has all right, power and authority and, if an individual, the capacity necessary to enter into the Partnership Agreement, (iii) granted the powers of attorney provided for in the Partnership Agreement and (iv) made the waivers and given the consents and approvals contained in the Partnership Agreement.

This Certificate shall not be valid for any purpose unless it has been countersigned and registered by the Transfer Agent and Registrar.


Dated:	Teekay Offshore Partners L.P.

Countersigned and Registered by:	By:	Teekay Offshore GP L.L.C.,
		its General Partner

	By:
as Transfer Agent and Registrar		Title:

By:	By:
Authorized Signature		Secretary

A-1

[Reverse of Certificate]

ABBREVIATIONS

The following abbreviations, when used in the inscription on the face of this Certificate, shall be construed as follows according to applicable laws or regulations:


TEN COM	—	as tenants in common	UNIF GIFT/TRANSFERS MIN ACT
			Custodian
			(Cust) (Minor)
TEN ENT	—	as tenants by the entireties	under Uniform Gifts /Transfers to CD Minors Act (State)
JT TEN	—	as joint tenants with right of
		survivorship and not as tenants in common

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

ASSIGNMENT OF COMMON UNITS

TEEKAY OFFSHORE PARTNERS L.P.


FOR VALUE RECEIVED, hereby assigns, conveys, sells and transfers unto

(Please print or typewrite name		(Please insert Social Security or other
and address of Assignee)		identifying number of Assignee)

Common Units representing limited partner interests evidenced by this Certificate, subject to the Partnership Agreement, and does hereby irrevocably constitute and appoint as its attorney-in-fact with full power of substitution to transfer the same on the books of the Partnership.

Date:

NOTE:

The signature to any endorsement hereon must correspond with the name as written upon the face of this Certificate in every particular, without alteration, enlargement or change.

THE SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15

(Signature)

No transfer of the Common Units evidenced hereby will be registered on the books of the Partnership, unless the Certificate evidencing the Common Units to be transferred is surrendered for registration or transfer.

A-2

EXHIBIT B

to the Sixth Amended and Restated

Agreement of Limited Partnership of

Teekay Offshore Partners L.P.

Certificate Evidencing Series A Cumulative

Redeemable Preferred Units

Representing Limited Partner Interests in

Teekay Offshore Partners L.P.


No.		Series A Preferred Units

In accordance with Section 4.1 of the Sixth Amended and Restated Agreement of Limited Partnership of Teekay Offshore Partners L.P., as amended, supplemented or restated from time to time (the “Partnership Agreement” ), Teekay Offshore Partners L.P., a Marshall Islands limited partnership (the “Partnership” ), hereby certifies that (the “Holder” ) is the registered owner of 7.25% Series A Cumulative Redeemable Preferred Units representing limited partner interests in the Partnership (the “Series A Preferred Units” ) transferable on the books of the Partnership, in person or by duly authorized attorney, upon surrender of this Certificate properly endorsed. The rights, preferences and limitations of the Series A Preferred Units are set forth in, and this Certificate and the Series A Preferred Units represented hereby are issued and shall in all respects be subject to the terms and provisions of, the Partnership Agreement. Copies of the Partnership Agreement are on file at, and will be furnished without charge on delivery of written request to the Partnership at, the principal office of the Partnership located at 4th Floor, Belvedere Building, 69 Pitts Bay Road, Hamilton, HM 08, Bermuda. Capitalized terms used herein but not defined shall have the meanings given them in the Partnership Agreement.

This Certificate shall not be valid for any purpose unless it has been countersigned and registered by the Transfer Agent and Registrar.


Dated:	Teekay Offshore Partners L.P.

Countersigned and Registered by:	By:	Teekay Offshore GP L.L.C.,
		its General Partner

	By:
as Transfer Agent and Registrar		Title:

By:	By:
Authorized Signature		Secretary

B-1

[Reverse of Certificate]

ABBREVIATIONS

The following abbreviations, when used in the inscription on the face of this Certificate, shall be construed as follows according to applicable laws or regulations:


TEN COM	—	as tenants in common	UNIF GIFT/TRANSFERS MIN ACT
			Custodian
			(Cust) (Minor)
TEN ENT	—	as tenants by the entireties	under Uniform Gifts /Transfers to CD Minors Act (State)
JT TEN	—	as joint tenants with right of
		survivorship and not as tenants in common

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

ASSIGNMENT OF SERIES A PREFERRED UNITS

TEEKAY OFFSHORE PARTNERS L.P.


FOR VALUE RECEIVED, hereby assigns, conveys, sells and transfers unto

(Please print or typewrite name		(Please insert Social Security or other
and address of Assignee)		identifying number of Assignee)

Series A Preferred Units representing limited partner interests evidenced by this Certificate, subject to the Partnership Agreement, and does hereby irrevocably constitute and appoint as its attorney-in-fact with full power of substitution to transfer the same on the books of the Partnership.


Date:	NOTE:	The signature to any endorsement hereon must correspond with the name as written upon the face of this Certificate in every particular, without alteration, enlargement or change.
THE SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15		(Signature) (Signature)
		(Signature) (Signature)

No transfer of the Series A Preferred Units evidenced hereby will be registered on the books of the Partnership, unless the Certificate evidencing the Series A Preferred Units to be transferred is surrendered for registration or transfer.

B-2

EXHIBIT C

to the Sixth Amended and Restated

Agreement of Limited Partnership of

Teekay Offshore Partners L.P.

Certificate Evidencing Series B Cumulative

Redeemable Preferred Units

Representing Limited Partner Interests in

Teekay Offshore Partners L.P.


No.		Series B Preferred Units

In accordance with Section 4.1 of the Sixth Amended and Restated Agreement of Limited Partnership of Teekay Offshore Partners L.P., as amended, supplemented or restated from time to time (the “Partnership Agreement” ), Teekay Offshore Partners L.P., a Marshall Islands limited partnership (the “Partnership” ), hereby certifies that (the “Holder” ) is the registered owner of 8.50% Series B Cumulative Redeemable Preferred Units representing limited partner interests in the Partnership (the “Series B Preferred Units” ) transferable on the books of the Partnership, in person or by duly authorized attorney, upon surrender of this Certificate properly endorsed. The rights, preferences and limitations of the Series B Preferred Units are set forth in, and this Certificate and the Series B Preferred Units represented hereby are issued and shall in all respects be subject to the terms and provisions of, the Partnership Agreement. Copies of the Partnership Agreement are on file at, and will be furnished without charge on delivery of written request to the Partnership at, the principal office of the Partnership located at 4th Floor, Belvedere Building, 69 Pitts Bay Road, Hamilton, HM 08, Bermuda. Capitalized terms used herein but not defined shall have the meanings given them in the Partnership Agreement.

This Certificate shall not be valid for any purpose unless it has been countersigned and registered by the Transfer Agent and Registrar.


Dated:	Teekay Offshore Partners L.P.

Countersigned and Registered by:	By:	Teekay Offshore GP L.L.C.,
		its General Partner

	By:
as Transfer Agent and Registrar		Title:

By:	By:
Authorized Signature		Secretary

C-1

[Reverse of Certificate]

ABBREVIATIONS

The following abbreviations, when used in the inscription on the face of this Certificate, shall be construed as follows according to applicable laws or regulations:


TEN COM	—	as tenants in common	UNIF GIFT/TRANSFERS MIN ACT
			Custodian
			(Cust) (Minor)
TEN ENT	—	as tenants by the entireties	under Uniform Gifts /Transfers to CD Minors Act (State)
JT TEN	—	as joint tenants with right of survivorship and not as tenants in common

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

ASSIGNMENT OF SERIES B PREFERRED UNITS

TEEKAY OFFSHORE PARTNERS L.P.


FOR VALUE RECEIVED, hereby assigns, conveys, sells and transfers unto

(Please print or typewrite name		(Please insert Social Security or other
and address of Assignee)		identifying number of Assignee)

Series B Preferred Units representing limited partner interests evidenced by this Certificate, subject to the Partnership Agreement, and does hereby irrevocably constitute and appoint as its attorney-in-fact with full power of substitution to transfer the same on the books of the Partnership.

Date:

NOTE:

The signature to any endorsement hereon must correspond with the name as written upon the face of this Certificate in every particular, without alteration, enlargement or change.

(Signature)

No transfer of the Series B Preferred Units evidenced hereby will be registered on the books of the Partnership, unless the Certificate evidencing the Series B Preferred Units to be transferred is surrendered for registration or transfer.

C-2

EXHIBIT D

to the Sixth Amended and Restated

Agreement of Limited Partnership of

Teekay Offshore Partners L.P.

Certificate Evidencing Series E Fixed-to-Floating Rate

Cumulative Redeemable Perpetual Preferred Units

Representing Limited Partner Interests in

Teekay Offshore Partners L.P.


No.		Series E Preferred Units

In accordance with Section 4.1 of the Sixth Amended and Restated Agreement of Limited Partnership of Teekay Offshore Partners L.P., as amended, supplemented or restated from time to time (the “Partnership Agreement” ), Teekay Offshore Partners L.P., a Marshall Islands limited partnership (the “Partnership” ), hereby certifies that (the “Holder” ) is the registered owner of 8.875% Series E Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units representing limited partner interests in the Partnership (the “Series E Preferred Units” ) transferable on the books of the Partnership, in person or by duly authorized attorney, upon surrender of this Certificate properly endorsed. The rights, preferences and limitations of the Series E Preferred Units are set forth in, and this Certificate and the Series E Preferred Units represented hereby are issued and shall in all respects be subject to the terms and provisions of, the Partnership Agreement. Copies of the Partnership Agreement are on file at, and will be furnished without charge on delivery of written request to the Partnership at, the principal office of the Partnership located at 4th Floor, Belvedere Building, 69 Pitts Bay Road, Hamilton, HM 08, Bermuda. Capitalized terms used herein but not defined shall have the meanings given them in the Partnership Agreement.

This Certificate shall not be valid for any purpose unless it has been countersigned and registered by the Transfer Agent and Registrar.


Dated:	Teekay Offshore Partners L.P.

Countersigned and Registered by:	By:	Teekay Offshore GP L.L.C.,
		its General Partner

	By:
as Transfer Agent and Registrar		Title:

By:	By:
Authorized Signature		Secretary

D-1

[Reverse of Certificate]

ABBREVIATIONS

The following abbreviations, when used in the inscription on the face of this Certificate, shall be construed as follows according to applicable laws or regulations:


TEN COM	—	as tenants in common	UNIF GIFT/TRANSFERS MIN ACT
			Custodian
			(Cust) (Minor)
TEN ENT	—	as tenants by the entireties	under Uniform Gifts /Transfers to CD Minors Act (State)
JT TEN	—	as joint tenants with right of survivorship and not as tenants in common

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

ASSIGNMENT OF SERIES E PREFERRED UNITS

TEEKAY OFFSHORE PARTNERS L.P.


FOR VALUE RECEIVED, hereby assigns, conveys, sells and transfers unto

(Please print or typewrite name		(Please insert Social Security or other
and address of Assignee)		identifying number of Assignee)

Series E Preferred Units representing limited partner interests evidenced by this Certificate, subject to the Partnership Agreement, and does hereby irrevocably constitute and appoint as its attorney-in-fact with full power of substitution to transfer the same on the books of the Partnership.

Date:

NOTE:

The signature to any endorsement hereon must correspond with the name as written upon the face of this Certificate in every particular, without alteration, enlargement or change.

(Signature)

No transfer of the Series E Preferred Units evidenced hereby will be registered on the books of the Partnership, unless the Certificate evidencing the Series E Preferred Units to be transferred is surrendered for registration or transfer.

D-2

Exhibit 5.1

LOGO

Teekay Offshore Partners L.P.

4th Floor, Belvedere Building

69 Pitts Bay Road

Hamilton HM 08

Bermuda

Our reference: 25247.50142/80542356v2

January 23, 2018

Registration Statement on Form F-3 – Exhibit 5.1 Opinion

Ladies and Gentlemen:

We have acted as special counsel as to matters of the law of the Republic of the Marshall Islands (“ Marshall Islands Law ”) for Teekay Offshore Partners L.P., a Marshall Islands limited partnership (the “ Partnership ”), in connection with the issuance and sale by the Partnership of up to 5,290,000 of the Partnership’s 8.875% Series E Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units (the “ Preferred Units ”) pursuant to the Partnership’s Registration Statement on Form F-3 (No. 333-221745) (the “ Registration Statement ”), the preliminary prospectus supplement dated January 16, 2018 to the base prospectus dated January 10, 2018 (together, the “ Preliminary Prospectus ”) and the prospectus supplement dated January 16, 2018 to the base prospectus dated January 10, 2018 (together, the “ Prospectus ”).

In rendering this opinion, we have examined originals or photocopies of all such documents, including (i) the Registration Statement, the Preliminary Prospectus and the Prospectus, (ii) the certificate of limited partnership and the Fifth Amended and Restated Agreement of Limited Partnership of the Partnership, (iii) the form of Sixth Amended and Restated Agreement of Limited Partnership of the Partnership (the “ Partnership Agreement ”), (iv) the Underwriting Agreement (the “ Underwriting Agreement ”) dated January 16, 2018, among the representatives of the underwriters named therein, the Partnership and Teekay Offshore GP L.L.C., a Marshall Islands limited liability company (together with the Partnership, the “ Teekay Parties ”) and (v) such other papers, documents and certificates of public officials and certificates of representatives of the Teekay Parties, as we have deemed necessary, and upon representation and warranties of the Teekay Parties contained in the Underwriting Agreement.

Watson Farley & Williams LLP 250 West 55th Street New York New York 10019 T +1 212 922 2200 F +1 212 922 1512 wfw.com

Watson Farley & Williams LLP is a limited liability partnership that (or a WFW Affiliated Entity) has an office in each of the cities listed above.

Page 2

LOGO

original documents of all documents submitted to us as conformed or photostatic copies, (d) that the documents reviewed by us in connection with the rendering of the opinion set forth herein are true, correct and complete and (e) the truthfulness of each statement as to all factual matters contained in any document or certificate encompassed within the due diligence review undertaken by us. As to any questions of fact material to our opinion, we have, when relevant facts were not independently established, relied upon the aforesaid certificates.

In rendering this opinion, we have also assumed:

(i)	that the issuance and sale of the Preferred Units complies in all respects with the terms, conditions and restrictions set forth in the Preliminary Prospectus and the Prospectus and all of the instruments and other documents relating thereto or executed in connection therewith;

(ii)	that the Underwriting Agreement has been duly and validly authorized by the parties thereto (other than the Teekay Parties), and executed and delivered by such parties thereto;

(iii)

the Preferred Units shall be issued and sold in compliance with applicable U.S. federal, state and foreign laws and in the manner stated in the Registration Statement, Preliminary Prospectus and the Prospectus; and

(iv)	the validity and enforceability of the Underwriting Agreement against the parties thereto.

This opinion is limited to Marshall Islands Law and is as of the date hereof. We expressly disclaim any responsibility to advise of any development or circumstance of any kind, including any change of law or fact that may occur after the date of this opinion letter that might affect the opinion expressed herein.

Based on the foregoing and having regard to legal considerations which we deem relevant, and subject to the qualifications, limitations and assumptions set forth herein, we are of the opinion that when the Preferred Units have been issued and delivered against payment therefor in accordance with the terms of the Partnership Agreement, Underwriting Agreement, Registration Statement and Prospectus, the Preferred Units will be validly issued, fully paid (to the extent required under the Partnership Agreement) and nonassessable (except as such nonassessability may be affected by Sections 30, 41, 51 and 60 of the Marshall Islands Limited Partnership Act).

Page 3

LOGO

We consent to the filing of this opinion as an exhibit to a Report on Form 6-K of the Partnership, the discussion of this opinion in the Registration Statement, the Preliminary Prospectus and the Prospectus, and to the references to our firm in the Registration Statement, the Preliminary Prospectus and the Prospectus. In giving this consent, we do not hereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended (the “ Securities Act ”) and the rules and regulations promulgated thereunder (the “ Rules ”) nor do we admit that we are experts with respect to any part of the Registration Statement within the meaning of the term “expert” as used in the Securities Act or related Rules.

Very truly yours,

Watson Farley & Williams LLP

/s/ Watson Farley & Williams LLP

Exhibit 8.1

January 23, 2018

Teekay Offshore Partners L.P.

Teekay Offshore GP L.L.C.

4th Floor, Belvedere Building

69 Pitts Bay Road

Hamilton, HM08

Bermuda

Re:

Teekay Offshore Partners L.P. Registration Statement on Form F-3

Ladies and Gentlemen:

We have acted as counsel to Teekay Offshore Partners L.P., a Republic of the Marshall Islands limited partnership (the “Partnership”), in connection with the preparation and filing with the Securities and Exchange Commission (the “Commission”) pursuant to the Securities Act of 1933, as amended (the “Securities Act”) of a preliminary prospectus supplement dated January 16, 2018 (the “Preliminary Prospectus Supplement”) and a final prospectus supplement dated January 16, 2018 (the “Prospectus Supplement”) to that certain registration statement on Form F-3 filed with the Commission on November 24, 2017 (No. 333-221745), as amended (the “Registration Statement”), for the offer and sale of up to 5,290,000 8.875% Series E Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units of the Partnership.

You have requested our opinion regarding certain United States federal income tax considerations that may be relevant to prospective Series E Preferred unitholders. In rendering our opinion, we have examined and relied upon the truth, accuracy, and completeness of the facts, statements and representations contained in (i) the Registration Statement, the Preliminary Prospectus Supplement and the Prospectus Supplement, (ii) the certificate of the Partnership, Teekay Offshore GP L.L.C., a Republic of The Marshall Islands limited liability company (the “General Partner”), and certain other affiliates of the Partnership (the “Tax Certificate”), (iii) that certain Sixth Amended and Restated Agreement of Limited Partnership of Teekay Offshore Partners L.P. (the “Partnership Agreement”), and (iv) such other documents, certificates, records, statements and representations made by the Partnership as we have deemed necessary or appropriate as a basis for the opinion set forth below. We have not, however, undertaken an independent investigation of any factual matter set forth in any of the foregoing.

In addition, we have assumed, with your permission, (i) that the Partnership will operate in full compliance with the terms of the Partnership Agreement without waiver or breach of any material provision thereof and (ii) the statements and representations concerning the Partnership and its operations contained in the Registration Statement, the Preliminary Prospectus Supplement and the Prospectus Supplement and the statements and representations contained in the Tax Certificate are true, correct and complete and will remain true, correct and complete at all relevant times, (iii) the authenticity of original documents submitted to us and the conformity to the originals of documents submitted to us as copies and (iv) that any statement or representation contained in the Tax Certificate with the qualification “to the knowledge of” or “based on the belief of” or other similar qualification, is true, correct and complete and will remain true, correct and complete at all relevant times, in each case without such qualification.

Teekay Offshore Partners L.P.

January 23, 2018

Page 2

Based upon the foregoing, and subject to the limitations, qualifications, assumptions and caveats set forth herein and in the Preliminary Prospectus Supplement, the Prospectus Supplement and the Registration Statement, we hereby confirm our opinions set forth in, and as of the date of, the Preliminary Prospectus Supplement, the Prospectus Supplement and the Registration Statement under the heading “Material United States Federal Income Tax Considerations.”

This opinion addresses only the matters of United States federal income taxation specifically described under the heading “Material United States Federal Income Tax Considerations” in the Preliminary Prospectus Supplement, the Prospectus Supplement and the Registration Statement. This opinion does not address any other United States federal tax consequences or any state, local or foreign tax consequences that may be relevant to prospective Series E Preferred unitholders.

We hereby consent to the discussion of this opinion in the Preliminary Prospectus Supplement, the Prospectus Supplement and the Registration Statement, to the filing of this opinion as an exhibit to a report on Form 6-K of the Partnership, to the incorporation by reference of this opinion into the Preliminary Prospectus Supplement, the Prospectus Supplement and the Registration Statement and to the use of our name under the captions “Legal Matters” and “Material United States Federal Income Tax Considerations” in the Preliminary Prospectus Supplement, the Prospectus Supplement and the Registration Statement. In giving this consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended (the “Securities Act”), nor do we admit that we are experts with respect to any part of the Preliminary Prospectus Supplement, the Prospectus Supplement or the Registration Statement within the meaning of the term “expert” as used in the Securities Act or the rules and regulations of the Securities and Exchange Commission promulgated thereunder.

Very truly yours,

/s/ Perkins Coie LLP

Perkins Coie LLP

Exhibit 8.2

LOGO

Teekay Offshore Partners L.P.

4th Floor, Belvedere Building

69 Pitts Bay Road

Hamilton HM 08

Bermuda

Our reference: 25247.50142/80445209v2

January 23, 2018

Registration Statement on Form F-3 – Exhibit 8.2 Opinion

We have acted as special counsel as to matters of the law of the Republic of the Marshall Islands (“ Marshall Islands Law ”) for Teekay Offshore Partners L.P., a Marshall Islands limited partnership (the “ Partnership ”), in connection with the issuance and sale by the Partnership of 8.875% Series E Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units pursuant to the Partnership’s Registration Statement on Form F-3 (No. 333-221745) (the “ Registration Statement ”), the preliminary prospectus supplement dated January 16, 2018 to the base prospectus dated January 10, 2018 (together, the “ Base Prospectus ”) and the prospectus supplement dated January 16, 2018 to the base prospectus dated January 10, 2018 (together, the “ Prospectus Supplement ”).

As such counsel, we have examined originals or copies (certified or otherwise identified to our satisfaction) of all such documents, including (i) the Registration Statement and the prospectus contained therein (the “ Prospectus ”), (ii) the certificate of limited partnership and Fifth Amended and Restated Limited Partnership of the Partnership, each as amended to date, (iii) a draft of the Sixth Amended and Restated Limited Partnership Agreement of the Partnership, and (iv) such other records, certificates, agreements, documents or other instruments, and such certificates or comparable documents of public officials and of officers and representatives of the Partnership as we have deemed relevant and necessary.

In such examination, we have assumed (a) the legal capacity of each natural person, (b) the genuineness of all signatures and the authenticity of all documents submitted to us as originals, (c) the conformity to original documents of all documents submitted to us as conformed or photostatic copies, (d) that the documents reviewed by us in connection with the rendering of the opinion set forth herein are true, correct and complete and (e) the truthfulness of each statement as to all factual matters contained in any document or certificate encompassed within the due diligence review undertaken by us.

Watson Farley & Williams LLP 250 West 55th Street New York New York 10019 T +1 212 922 2200 F +1 212 922 1512 wfw.com

Watson Farley & Williams LLP is a limited liability partnership that (or a WFW Affiliated Entity) has an office in each of the cities listed above.

Page 2

LOGO

As to any questions of fact material to our opinion, we have, when relevant facts were not independently established, relied upon the aforesaid certificates or comparable documents. We have not independently verified the facts so relied on.

This opinion letter is limited to Marshall Islands Law and is as of the date hereof. We expressly disclaim any responsibility to advise of any development or circumstance of any kind, including any change of law or fact that may occur after the date of this opinion letter that might affect the opinion expressed herein.

Based on the facts as set forth in the Registration Statement, the Base Prospectus and the Prospectus Supplement, and having regard to legal considerations which we deem relevant, and subject to the qualifications, limitations and assumptions set forth herein, we hereby confirm that we have reviewed the discussion set forth in the Prospectus Supplement under the caption “Non-United States Tax Considerations—Republic of the Marshall Islands Tax Considerations” and we confirm that the statements in such discussions, to the extent they constitute summaries of law or legal conclusions, unless otherwise noted, are the opinion of Watson Farley & Williams LLP with respect to Marshall Islands tax consequences as of the date of the effectiveness of the Registration Statement (except for the representations and statements of fact of the Partnership included under such caption, as to which we express no opinion).

We consent to the filing of this opinion as an exhibit to a Report on Form 6-K of the Partnership, the discussion of this opinion in the Registration Statement, and to the references to our firm in the Registration Statement and the Prospectus. In giving this consent, we do not hereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended (the “ Securities Act ”) or the rules and regulations promulgated thereunder, nor do we admit that we are experts with respect to any part of the Registration Statement within the meaning of the term “expert” as used in the Securities Act.

Very truly yours,

Watson Farley & Williams LLP

/s/ Watson Farley & Williams LLP