SC 13E3

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

SCHEDULE 13E-3

(Rule 13e-100)

Rule 13e-3 Transaction Statement Under

Section 13(e) of the Securities Exchange Act of 1934

PLAINS RESOURCES INC.

(Name of the Issuer)

Plains Resources Inc., James C. Flores, John T. Raymond,

Vulcan Energy Corporation, Prime Time Acquisition Corporation

(Name of Person(s) Filing Statement)

Common Stock, Par Value $0.10 Per Share

(Title of Class of Securities)

726540503

(CUSIP Number of Class of Securities)

John F. Wombwell Executive Vice President, General Counsel and Secretary Plains Resources Inc. 700 Milam, Suite 3100 Houston, TX 77002 (832) 239-6000	Richard Leigh Vice President and Secretary Vulcan Energy Corporation 505 5th Avenue South Suite 900 Seattle, WA 98104 (206) 342-2000
copy to:	copy to:
Michael E. Dillard, P.C. Julien R. Smythe Akin Gump Strauss Hauer & Feld LLP 1900 Pennzoil Place, South Tower 711 Louisiana Street Houston, TX 77002 (713) 220-5800	Frank Ed Bayouth II Skadden, Arps, Slate, Meagher & Flom LLP 1600 Smith Street, Suite 4400 Houston, TX 77002 (713) 655-5100

(Name, Address and Telephone Number of Persons Authorized to Receive Notices and

Communications on Behalf of Person(s) Filing Statement)

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the transaction, passed upon the merits or the fairness of the transaction or passed upon the adequacy or accuracy of the information contained in this document. Any representation to the contrary is a criminal offense.

This statement is filed in connection with (check the appropriate box):

a.	x	The filing of solicitation materials or an information statement subject to Regulation 14A, Regulation 14C or Rule 13e-3(c) under the Securities Exchange Act of 1934.
b.	¨	The filing of a registration statement under the Securities Act of 1933.
c.	¨	A tender offer.
d.	¨	None of the above.

Check the following box if the soliciting materials or information statement referred to in checking box (a) are preliminary copies: x

Check the following box if the filing is a final amendment reporting the results of the transaction: ¨

CALCULATION OF FILING FEE*

Transaction value	Amount of Filing Fee
$385,161,498.00	$48,799.96

* The filing fee of $48,799.96 was calculated pursuant to Exchange Act Rule 0-11(c)(1) and is based on (1) the aggregate number of 22,675,700 shares of Plains Resources common stock, $0.10 par value per share (the “Common Stock”), consisting of 22,599,200 shares of Common Stock outstanding plus the 76,500 restricted units representing the right to purchase Common Stock multiplied by the $16.75 per share merger consideration; plus (ii) the cash-out value of 1,610,785 options representing the right to purchase Common Stock. The filing fee was then calculated by multiplying the resulting transaction cash value of $385,161,498.00 by 0.00012670.

x Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule and date of its filing.

Amount Previously Paid: $48,799.96

Form or Registration No.: Schedule 14A

Filing Party: Plains Resources Inc.

Date Filed: March 2, 2004

INTRODUCTION

This Rule 13e-3 Transaction Statement on Schedule 13E-3 is being filed with the Securities and Exchange Commission pursuant to Section 13(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) by (1) Plains Resources Inc., a Delaware corporation (“Plains Resources”), (2) James C. Flores and John T. Raymond (including their affiliates, the “Management Stockholders”), (3) Vulcan Energy Corporation, a newly formed Delaware corporation (“Vulcan Energy”) which will be 100% owned by Mr. Allen and the Management Stockholders following the proposed merger discussed below, and (4) Prime Time Acquisition Corporation, a newly formed Delaware corporation and wholly owned subsidiary of Vulcan Energy (the “Vulcan Merger Subsidiary”). The preceding persons are collectively referred to herein as the “Filing Persons,” and individually as a “Filing Person.”

This Schedule 13E-3 relates to a proposed merger of the Vulcan Merger Subsidiary with and into Plains Resources (the “Merger”) pursuant to an Agreement and Plan of Merger, dated as of February 19, 2004 (the “Merger Agreement”), by and among Vulcan Energy, the Vulcan Merger Subsidiary and Plains Resources. In connection with the Merger:

• each share of Plains Resources common stock outstanding at the effective time of the merger (other than shares held directly or indirectly by Vulcan Energy or Plains Resources and other than shares held by dissenting stockholders who exercise and perfect their appraisal rights under Delaware law) will be converted into the right to receive $16.75 in cash;

• each share of restricted common stock of Plains Resources (other than restricted shares held by the Management Stockholders) will become fully vested and will be converted into the right to receive $16.75 in cash;

• each option to purchase shares of Plains Resources common stock (other than stock options held by the Management Stockholders) will become fully vested and exercisable, and each holder of options to purchase shares of Plains Resources common stock (other than the Management Stockholders) will receive, upon exercise of the option, an amount in cash equal to the number of unexercised shares subject to such option times the excess of $16.75 over the per share exercise price of the option; and

• each outstanding restricted stock unit (other than restricted stock units held by the Management Stockholders) will become fully vested and payable and treated as a share of Plains Resources common stock and exchanged for $16.75 in cash.

As a result of the merger, the stockholders of Plains Resources (other than Vulcan Energy and its affiliates and the Management Stockholders) will no longer have any interest in, and will no longer be stockholders of, Plains Resources and will not participate in the future earnings or growth of Plains Resources, if any.

Concurrently with the filing of this Schedule 13E-3, Plains Resources is filing under Regulation 14A of the Exchange Act a preliminary proxy statement pursuant to which Plains Resources’ stockholders will be given notice of, and be asked to vote with respect to, the approval and adoption of the Merger Agreement and the Merger.

A copy of the proxy statement is incorporated by reference herein as Exhibit (a)(3) and a copy of the Merger Agreement is attached as Appendix A to the proxy statement. All references in this Schedule 13E-3 to Items numbered 1001 through 1016 are references to Items set forth in Regulation M-A under the Exchange Act.

The cross reference sheet below is being supplied pursuant to General Instruction F to Schedule 13E-3 and shows the location in the proxy statement of the information required to be included in response to the items in this Schedule 13E-3. The information contained in the proxy statement, including all schedules, exhibits, appendices and annexes thereto, is hereby expressly incorporated herein by reference and the responses to each item in this Schedule 13E-3 are qualified in their entirety by the information contained in the proxy statement and the schedules, exhibits, appendices and annexes thereto. As of the date hereof, the proxy statement is in preliminary form and is subject to completion or amendment. Capitalized terms used but not defined in this Schedule 13E-3 shall have the meanings given to them in the proxy statement.

All information contained in, or incorporated by reference in, this Schedule 13E-3 concerning Plains Resources has been supplied by Plains Resources and no other Filing Person takes responsibility for the accuracy of any

information not supplied by such Filing Person. The information contained in this Schedule 13E-3 and/or the proxy statement concerning each Filing Person other than Plains Resources was supplied by each such Filing Person and no other Filing Person, including Plains Resources, takes responsibility for the accuracy of any information not supplied by such Filing Person.

Item 1. Summary Term Sheet

Regulation M-A

Item 1001

Summary Term Sheet. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

Item 2. Subject Company Information

Regulation M-A

Item 1002

(a) Name and Address. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Information About the Transaction Participants”

(b) Securities. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Information Concerning the Special Meeting—Record Date”

“Common Stock Market Price and Dividend Information”

(c) Trading Market and Price. The information contained in the proxy statement under the caption “Common Stock Market Price and Dividend Information” is incorporated herein by reference.

(d) Dividends. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Common Stock Market Price and Dividend Information”

“Merger Agreement—Conduct of Business Pending the Merger”

(e) Prior Public Offerings. None.

(f) Prior Stock Purchases. The information contained in the proxy statement under the caption “Information Regarding Common Stock Transactions—Purchases by Plains Resources” is incorporated herein by reference.

Item 3. Identity and Background of Filing Persons

Regulation M-A

Item 1003

(a) Name and Address. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Current Executive Officers and Directors of Plains Resources”

“Current Executive Officers and Directors of Vulcan Energy and Vulcan Merger Subsidiary”

“Information About the Transaction Participants”

(b) Business and Background of Entities. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Information About the Transaction Participants”

(c) Business and Background of Natural Persons. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Current Executive Officers and Directors of Plains Resources”

“Current Executive Officers and Directors of Vulcan Energy and Vulcan Merger Subsidiary”

“Information About the Transaction Participants”

Item 4. Terms of the Transaction

Regulation M-A

Item 1004

(a)(1) Material Terms. Tender Offers. Not applicable.

(a)(2) Mergers or Similar Transactions. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Information Concerning the Special Meeting”

“Special Factors—Structure of the Transaction”

“Special Factors—Background of the Merger”

“Special Factors—Recommendations of the Special Committee and the Board of Directors; Reasons for Recommending the Approval and Adoption of the Merger Agreement and the Merger”

“Special Factors—Purposes of the Merger; Certain Effects of the Merger”

“Special Factors—Interests of Certain Persons in the Merger”

“Special Factors—Agreements with the Management Stockholders”

“Material U.S. Federal Income Tax Consequences”

“Merger Agreement”

(c) Different Terms. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Special Factors—Interests of Certain Persons in the Merger”

“Special Factors—Agreements with the Management Stockholders”

“Merger Agreement”

(d) Appraisal Rights. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Appraisal Rights”

“Merger Agreement—Appraisal Rights”

Appendix C

(e) Provisions for Unaffiliated Security Holders. The Filing Persons have made no provisions in connection with this transaction to grant unaffiliated security holders access to the respective corporate files of any of the Filing Persons or to obtain counsel or appraisal services at the expense of the Filing Persons.

(f) Eligibility for Listing or Trading. Not applicable.

Item 5. Past Contacts, Transactions, Negotiations and Agreements

Regulation M-A

Item 1005

(a) Transactions. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Special Factors—Interests of Certain Persons in the Merger”

“Special Factors—Agreements with the Management Stockholders”

“Information About the Transaction Participants—Past Contacts, Transactions, Negotiations and Agreements”

(b) Significant Corporate Events. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Special Factors—Background of the Merger”

“Special Factors—Interests of Certain Persons in the Merger”

(c) Negotiations or Contacts. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Special Factors—Background of the Merger”

“Special Factors—Agreements with the Management Stockholders”

“Special Factors—Interests of Certain Persons in the Merger”

(d) Conflicts of Interest. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Special Factors—Background of the Merger”

“Special Factors—Purposes of the Merger; Certain Effects of the Merger”

“Special Factors—Interests of Certain Persons in the Merger”

“Special Factors—Agreements with the Management Stockholders”

(e) Agreements Involving the Subject Company’s Securities. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Special Factors—Interests of Certain Persons in the Merger”

“Special Factors—Agreements with the Management Stockholders”

“Information About the Transaction Participants—Past Contacts, Transactions, Negotiations and Agreements”

Item 6. Purposes of the Transaction and Plans or Proposals

Regulation M-A

Item 1006

(b) Use of Securities Acquired. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Special Factors—Structure of the Transaction”

“Special Factors—Agreements with the Management Stockholders”

“Special Factors—Plans for Plains Resources Following the Merger”

“Merger Agreement”

(c)(1)-(8) Plans. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Special Factors—Structure of the Transaction”

“Special Factors—Purposes of the Merger; Certain Effects of the Merger”

“Special Factors—Agreements with the Management Stockholders”

“Special Factors—Interests of Certain Persons in the Merger”

“Special Factors—Agreements with the Management Stockholders”

“Special Factors—Plans for Plains Resources Following the Merger”

“Financing For the Merger”

“Merger Agreement”

Item 7. Purposes, Alternatives, Reasons and Effects

Regulation M-A

Item 1013

(a) Purposes. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Special Factors—Background of the Merger”

“Special Factors—Recommendations of the Special Committee and the Board of Directors; Reasons for Recommending the Approval and Adoption of the Merger Agreement and the Merger”

“Special Factors—Purposes of the Merger; Certain Effects of the Merger”

“Special Factors—Position of Vulcan Energy and the Vulcan Merger Subsidiary as to the Fairness of the Merger to Plains Resources Stockholders”

“Special Factors—Interests of Certain Persons in the Merger”

“Special Factors—Agreements with the Management Stockholders”

“Special Factors—Plans For Plains Resources Following the Merger”

(b) Alternatives. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Special Factors—Background of the Merger”

“Special Factors—Recommendations of the Special Committee and the Board of Directors; Reasons for Recommending the Approval and Adoption of the Merger Agreement and the Merger”

“Special Factors—Purposes of the Merger; Certain Effects of the Merger”

“Special Factors—Plans For Plains Resources if the Merger is Not Completed”

(c) Reasons. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Special Factors—Background of the Merger”

“Special Factors—Purposes of the Merger; Certain Effects of the Merger”

“Special Factors—Recommendations of the Special Committee and the Board of Directors; Reasons for Recommending the Approval and Adoption of the Merger Agreement and the Merger”

“Special Factors—Opinion of Financial Advisor to the Special Committee”

“Special Factors—Position of Vulcan Energy and the Vulcan Merger Subsidiary as to the Fairness of the Merger to Plains Resources Stockholders”

“Special Factors—Interests of Certain Persons in the Merger”

“Special Factors—Agreements with the Management Stockholders”

“Special Factors—Plans for Plains Resources Following the Merger”

(d) Effects. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Special Factors—Recommendations of the Special Committee and the Board of Directors; Reasons for Recommending the Approval and Adoption of the Merger Agreement and the Merger”

“Special Factors—Interests of Certain Persons in the Merger”

“Special Factors—Agreements with the Management Stockholders”

“Special Factors—Purposes of the Merger; Certain Effects of the Merger”

“Special Factors—Plans for Plains Resources Following the Merger”

“Material U.S. Federal Income Tax Consequences”

Item 8. Fairness of the Transaction

Regulation M-A

Item 1014

(a) Fairness. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Special Factors—Background of the Merger”

“Special Factors—Recommendations of the Special Committee and the Board of Directors; Reasons for Recommending the Approval and Adoption of the Merger Agreement and the Merger”

“Special Factors—Opinion of Financial Advisor to the Special Committee”

“Special Factors—Position of Vulcan Energy and the Vulcan Merger Subsidiary as to the Fairness of the Merger to Plains Resources Stockholders”

“Special Factors—Interests of Certain Persons in the Merger”

(b) Factors Considered in Determining Fairness. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Special Factors—Structure of the Transaction”

“Special Factors—Background of the Merger”

“Special Factors—Recommendations of the Special Committee and the Board of Directors; Reasons for Recommending the Approval and Adoption of the Merger Agreement and the Merger”

“Special Factors—Opinion of Financial Advisor to the Special Committee”

“Special Factors—Position of Vulcan Energy and the Vulcan Merger Subsidiary as to the Fairness of the Merger to Plains Resources Stockholders”

“Special Factors—Purposes of the Merger; Certain Effects of the Merger”

“Special Factors—Interests of Certain Persons in the Merger”

“Special Factors—Agreements with the Management Stockholders”

(c) Approval of Security Holders. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Information Concerning the Special Meeting—Vote Required; How Shares Are Voted”

“Special Factors—Recommendations of the Special Committee and the Board of Directors; Reasons for Recommending the Approval and Adoption of the Merger Agreement and the Merger”

“Special Factors—Position of Vulcan Energy and the Vulcan Merger Subsidiary as to the Fairness of the Merger to Plains Resources Stockholders”

(d) Unaffiliated Representative. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Special Factors—Background of the Merger”

“Special Factors—Recommendations of the Special Committee and the Board of Directors; Reasons for Recommending the Approval and Adoption of the Merger Agreement and the Merger”

“Special Factors—Opinion of Financial Advisor to the Special Committee”

“Special Factors—Position of Vulcan Energy and the Vulcan Merger Subsidiary as to the Fairness of the Merger to Plains Resources Stockholders”

(e) Approval of Directors. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Special Factors—Background of the Merger”

“Special Factors—Recommendations of the Special Committee and the Board of Directors; Reasons for Recommending the Approval and Adoption of the Merger Agreement and the Merger”

“Special Factors—Position of Vulcan Energy and the Vulcan Merger Subsidiary as to the Fairness of the Merger to Plains Resources Stockholders”

(f) Other Offers. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Special Factors—Background of the Merger”

“Special Factors—Recommendations of the Special Committee and the Board of Directors; Reasons for Recommending the Approval and Adoption of the Merger Agreement and the Merger”

“Special Factors—Position of Vulcan Energy and the Vulcan Merger Subsidiary as to the Fairness of the Merger to Plains Resources Stockholders”

Item 9. Reports, Opinions, Appraisals and Negotiations

Regulation M-A

Item 1015

(a) Report, Opinion or Appraisal. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Special Factors—Background of the Merger”

“Special Factors—Recommendations of the Special Committee and the Board of Directors; Reasons for Recommending the Approval and Adoption of the Merger Agreement and the Merger”

“Special Factors—Opinion of Financial Advisor to the Special Committee”

“Special Factors—Position of Vulcan Energy and the Vulcan Merger Subsidiary as to the Fairness of the Merger to Plains Resources Stockholders”

Appendix B

(b) Preparer and Summary of the Report, Opinion or Appraisal. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Special Factors—Background of the Merger”

“Special Factors—Opinion of Financial Advisor to the Special Committee”

“Special Factors—Fees and Expenses”

Appendix B

(c) Availability of Documents. The information contained in the proxy statement under the caption “Special Factors—Opinion of Financial Advisor to the Special Committee” is incorporated herein by reference.

Item 10. Source and Amounts of Funds or Other Consideration

Regulation M-A

Item 1007

(a) Source of Funds. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Special Factors—Structure of the Transaction”

“Special Factors—Agreements with the Management Stockholders”

“Financing For the Merger”

“Merger Agreement”

(b) Conditions. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Special Factors—Structure of the Transaction”

“Special Factors—Agreements with the Management Stockholders”

“Financing For the Merger”

“Merger Agreement”

(c) Expenses. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Information Concerning the Special Meeting—Proxy Solicitation”

“Special Factors—Fees and Expenses”

“Financing For the Merger—Requirements”

(d) Borrowed Funds. Not applicable.

Item 11. Interest in Securities of the Subject Company

Regulation M-A

Item 1008

(a) Securities Ownership. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Special Factors—Interests of Certain Persons in the Merger”

“Security Ownership of Certain Beneficial Owners and Management of Plains Resources”

(b) Securities Transactions. The information contained in the proxy statement under the caption “Information Regarding Common Stock Transactions” is incorporated herein by reference.

Item 12. The Solicitation or Recommendation

Regulation M-A

Item 1012

(d) Intent to Tender or Vote in a Going-Private Transaction. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Information Concerning the Special Meeting—Vote Required; How Shares Are Voted”

(e) Recommendations of Others. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Questions and Answers About the Merger”

“Information Concerning the Special Meeting—Proxy Solicitation”

“Special Factors—Recommendations of the Special Committee and the Board of Directors; Reasons for Recommending the Approval and Adoption of the Merger Agreement and the Merger”

“Special Factors—Position of Vulcan Energy and the Vulcan Merger Subsidiary as to the Fairness of the Merger to Plains Resources Stockholders”

Item 13. Financial Statements

Regulation M-A

Item 1010

(a) Financial Information. The information contained in the proxy statement under the caption “Plains Resources Selected Historical Consolidated Financial Data” is incorporated herein by reference.

(b) Pro Forma Information. Not applicable.

Item 14. Persons/Assets, Retained, Employed, Compensated or Used

Regulation M-A

Item 1009

(a) Solicitations or Recommendations. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Information Concerning the Special Meeting—Proxy Solicitation”

“Special Factors—Recommendations of the Special Committee and the Board of Directors; Reasons for Recommending the Approval and Adoption of the Merger Agreement and the Merger”

“Special Factors—Opinion of the Financial Advisor to the Special Committee”

“Special Factors—Position of Vulcan Energy and the Vulcan Merger Subsidiary as to the Fairness of the Merger to Plains Resources Stockholders”

Appendix B

(b) Employees and Corporate Assets. The information contained in the proxy statement under the following captions is incorporated herein by reference:

“Summary”

“Information Concerning the Special Meeting—Proxy Solicitation”

“Special Factors—Background of the Merger”

“Special Factors—Interests of Certain Persons in the Merger”

Item 15. Additional Information

Regulation M-A

Item 1011

(b) Other Material Information. The entirety of the proxy statement, including all appendices thereto, is incorporated herein by reference.

Item 16. Exhibits

Regulation M-A

Item 1016

(a)(1) Not applicable.

(a)(3) Preliminary proxy statement, incorporated herein by reference to Schedule 14A as filed with the Securities and Exchange Commission by Plains Resources Inc. on March 2, 2004.

(b) Not applicable.

(c)(1) Presentation to the Board of Directors.

(c)(2) Opinion of Petrie Parkman & Co., dated February 18, 2004 (included as Appendix B to the preliminary proxy statement, which is filed herewith as Exhibit (a)(3)).

(d)(1) Agreement and Plan of Merger, dated as of February 19, 2004, by and among Vulcan Energy Corporation, Prime Time Acquisition Corporation and Plains Resources Inc. (included as Appendix A to the preliminary proxy statement, which is filed herewith as Exhibit (a)(3)).

(d)(2) Amended and Restated Subscription Agreement, dated as of February 19, 2004, by and among Vulcan Energy Corporation, Paul G. Allen, James C. Flores and John T. Raymond (included as Exhibit 99(a) to the Schedule 13D/A, which was filed by Plains Resources, the Management Stockholders, Mr. Allen and Vulcan Energy on February 26, 2004).

(d)(3) Form of Stockholders’ Agreement, dated as of November 19, 2003, by and among Vulcan Energy Corporation, Paul G. Allen, James C. Flores and John T. Raymond.

(d)(4) Form of Exclusivity Agreement, dated as of November 19, 2003, by and among Paul G. Allen, James C. Flores and John T. Raymond.

(d)(5) Form of Proposed Employment Agreement for James C. Flores; Summary of Key Terms.

(d)(6) Form of Proposed Employment Agreement for John T. Raymond; Summary of Key Terms.

(f) Section 262 of the Delaware General Corporation Law (included as Appendix C to the preliminary proxy statement, which is filed herewith as Exhibit (a)(3)).

(g) Not applicable.

* Previously filed.

SIGNATURES

After due inquiry and to the best of their knowledge and belief, the undersigned certify that the information set forth in this statement is true, complete and correct.

Dated: March 1, 2004	PLAINS RESOURCES INC.
		By: /s/ Stephen A. Thorington
		Name: Stephen A. Thorington
		Title:   Executive Vice President
Dated: March 1, 2004		/s/ James C. Flores
		James C. Flores
Dated: March 1, 2004		/s/ John T. Raymond
		John T. Raymond
Dated: March 1, 2004	PRIME TIME ACQUISITION CORPORATION
		By: /s/ David N. Capobianco
		Name: David N. Capobianco
		Title:   Vice President
Dated: March 1, 2004	VULCAN ENERGY CORPORATION
		By: /s/ David N. Capobianco
		Name: David N. Capobianco
		Title:   Vice President

EX-99.C1

Exhibit (c)(1)

Presentation to the Special Committee and Board of Directors

February 18, 2004

PETRIE PARKMAN & Co.

CONFIDENTIAL

This memorandum was prepared solely for the internal use of Petrie Parkman & Co. (“Petrie Parkman”) and The Special Committee of the Board of Directors (“Special Committee”) and the Board of Directors of Plains Resources Inc. (the “Company” or “PLX”) and was based solely on certain publicly-available information, materials supplied by PLX, discussions with PLX’s management and personnel, and the numerous assumptions specified herein; Petrie Parkman has not independently verified any such information. This memorandum presents an analysis of PLX.

In this analysis, Petrie Parkman has employed certain methodologies which it considers proprietary; accordingly, the Special Committee agrees not to disclose this memorandum to any outside party without Petrie Parkman’s prior consent. The analysis presented herein does not purport to reflect values that might be realized by PLX in a sale of all or part of the assets of PLX. The materials included in this memorandum reflect the views of Petrie Parkman at the time of its preparation. Petrie Parkman makes no representation or warranty, express or implied, as to the accuracy or completeness of the materials contained herein. The presentation does not imply agreement by the Special Committee or the Company with the analysis and is intended for informational purposes only.

PETRIE PARKMAN & Co.

February 2004

Table of Contents

I. Market Environment Update

II. Transaction Overview

III. Reference Value Analysis Summary

IV. Appendices

Reference Value Analysis (Detail) DCF Analysis Sensitivities Standard Definitions

PETRIE PARKMAN & Co.

i

Market Environment Update

PETRIE PARKMAN

Market Overview

Since the Special Committee’s January 8, 2004 meeting, both energy equities and the broader markets have been mixed

% Change

Since

Index 1/8/04 2/13/04 1/9/04

DJIA 10,592 10,628 0.3%)

S&P 500 1,132 1,146 1.2%)

NASDAQ 2,100 2,054 (2.2%)

10 Yr. Treasury 4.26% 4.04% (22 bps)

S&P O&G Index 1 229 232 (1.3%)

Pipeline Index 2 37 36 (2.8%)

MLP Peer Group 3 169 167 (1.4%)

PLX $ 16.27 $ 16.34 0.4%)

PAA $ 32.83 $ 31.84 (3.0%)

Oil and natural gas prices have declined somewhat but remain very strong relative to historical periods; OPEC has shown signs of pricing resolve in the face of continuing dollar weakness

PAA announced a distribution increase to an annualized rate of $2.25 per unit, and its intent to expand its Cushing Terminal Facility and Basin Pipeline System (total capex of $11 MM)

1 S&P O&G Index includes AHC, APC, APA, ASH, BR, CVX, COP, DVN, EOG, XOM, KMG, MRO, OXY, SUN and UCL.

2 Bloomberg US Pipeline Index includes EP, ENB, EQT, KMI, NFG, STR, TRP and WMB.

3 MLP Peer Group includes Magellan Midstream, Valero LP, Teppco Partners, TC Pipelines, Sunoco Logistics, Plains All American, Pacific Energy Partners, Northern Border, Martin Midstream, Markwest Energy Partners, Kinder Morgan Partners, Kaneb Pipe Line, Genesis Energy, Enterprise Products, Enbridge Energy Partners, CrossTex Energy Partners, Buckeye Partners, and Gulfterra.

PETRIE PARKMAN & Co.

1—1

Market Environment Update

Midstream Market Environment

Factor Environment Comment

Interest Rates Very Favorable Interest rates at historically low levels

Commodity Prices Very Favorable Spot prices for oil and gas near recent highs; very strong

relative to historical periods

Midstream Asset Favorable Restructuring of merchant energy companies created a

Market Environment target-rich environment

Equity Capital Very Favorable Widely available

Availability Investors’ desire for yield has fueled demand for MLP

units

Relatively tight yield range of MLP’s implies little current

differentiation among companies by investors

Debt Capital Very Favorable Commercial and high yield markets strong for energy

Availability companies

Competition Growing Numerous new midstream MLP’s created in last several

years to take advantage of market conditions

PETRIE PARKMAN & Co.

1—2

Transaction Overview

Since PLX’s receipt of the Vulcan Group’s $14.25 per share cash offer (“Vulcan Initial Offer”) on November 19, 2003 and the formation of the PLX Special Committee, the Special Committee and its advisors:

Publicly announced the hiring of Petrie Parkman as financial advisor and Baker Botts and Morris Nichols as legal advisors

o The announcement also stated the Special Committee had been authorized to review and evaluate alternative proposals that may be developed or received from other parties relating to a transaction with PLX

Performed due diligence on PLX, Plains All American Pipeline, L.P., and the Vulcan Group

Reviewed various potential strategic options for PLX, including remaining independent and possible alternative transactions or restructurings and the related tax implications to PLX

Formally rejected the Vulcan Initial Offer as inadequate through public announcement on January 22, 2004

Contacted a number of third parties regarding their interest in a possible transaction with PLX and besides the Vulcan Initial Offer, the Special Committee considered one resulting written proposal

Negotiated an improved offer from the Vulcan Group, providing for $16.75 per share in cash pursuant to a merger agreement

PETRIE PARKMAN & Co.

2—1

Transaction Overview

The following summarizes Petrie Parkman’s understanding of the key terms of the proposed transaction with Vulcan1:

Consideration: $16.75 per share in cash for each outstanding share of PLX common stock

Structure: Cash merger of PLX with and into a newly formed Vulcan Acquisition Sub, as a result of which PLX will become a wholly owned subsidiary of Vulcan

In the merger, each outstanding share of PLX to be converted into the right to receive $16.75 per share in cash

Conditions: Approval of PLX board of directors and recommendation of the Special Committee

Approval of the holders of a majority of the outstanding shares of PLX Closing of PAA’s Capline acquisition under terms not materially less favorable than currently negotiated

Fully committed financing to be received by Vulcan from Fleet ($175MM),

Bank of America ($65MM), reinvestment of Jim Flores and John Raymond equity, and the balance from Paul Allen

Flores and Raymond to have performed under terms of their Subscription Agreement with Vulcan

1 Based on draft of merger agreement dated February 16, 2004.

PETRIE PARKMAN & Co.

2—2

Transaction Overview

The following summarizes Petrie Parkman’s understanding of the key terms of the proposed transaction with Vulcan1 (cont’d):

Other Features: Customary fiduciary out and no-shop provisions

Termination fee of $[TBD]MM (approximately []% of equity value)

Vulcan to enter into voting agreements with Flores and Raymond

Other customary terms and conditions

On February 13, 2004, as a condition of Vulcan to continue to negotiate the terms of the potential merger, PLX entered into an exclusivity letter agreement with Vulcan

Exclusivity period to last until the later of seven days from letter signing (February 20, 2004)

– or –

The day after the Company files with the SEC for a request for an order declaring the Company is not an investment company under the ‘40 Act

Provided, however, that in no event shall the exclusivity period be longer than 14 days

1 Based on draft of merger agreement dated February 16, 2004.

PETRIE PARKMAN & Co.

2—3

Transaction Overview

Vulcan Offer Perspective

in millions, except per share amounts

Proposed Purchase Price ($/Sh.) $16.75

Fully Diluted Shares Outstanding (MM) 24.6

Purchase Price of Equity $412

Total Debt at 12/31/03 50

Net Working Capital at 12/31/03 (3)

Total Investment $459

Purchase Price / Net Income

LTM 9/30/03 55.9x

2003E 1 130.9x

2004E 2 45.1x

Total Investment / EBITDA

LTM 9/30/03 12.6x

2003E 1 12.7x

2004E 2 13.8x

Offer Premium to Market (Before Announcement) 3

1 Day 24.6%

30 Days 25.9%

60 Days 33.1%

1 Based on PLX estimates as of 1/5/04.

2 2004 estimates based on PLX 2004 Operational Plan Growth Case.

3 Before public announcement of Vulcan offer on 11/20/03.

PETRIE PARKMAN & Co.

2—4

Transaction Overview

PLX Common Stock Performance

(Closing Prices Since December 19, 2002)

Proposed Transaction Price $16.75/Share

Implied Premiums

Stock Price

$/Share Premium

Prior to Initial Offer Price

1 Day $13.44 24.6%

30 Days $13.30 25.9%

60 Days $12.58 33.1%

Period Average

30 Days $13.23 26.6%

60 Days $13.03 28.5%

High $14.54 15.2%

Low $10.41 60.9%

Since PXP Spin-off $12.62 32.7%

Entire Period High 1 $16.74 0.1%

Entire Period Low 1 $10.41 60.9%

1 Based on closing prices since PXP spin-off; does not include intraday trades.

PETRIE PARKMAN & Co.

2—5

Reference Value Analysis Summary

Reference Value Analysis

Petrie Parkman used the following methods of analysis in determining equity reference value ranges for PLX:

Methodology Description

Discounted Cash Flow / Going Concern Analysis Based on PLX financial projections for 2004 – 2013 using three different operating scenarios (Low Case, Mid Case and High Case). Discounted cash flow analysis of the projected unlevered free cash flows and terminal values for PLX using various discount rates and terminal multiple sensitivities.

Comparable Transaction Analysis Based upon the implied purchase price multiples for selected corporate transactions and offers for control and comparable asset transactions and the application of benchmark multiples to corresponding PLX financial and operating measures.

Premium Analysis Based upon the implied premiums paid in selected corporate transactions and offers for control and the application of these premiums to corresponding PLX historical prices.

Capital Market Comparison Based upon the review of market capitalization multiples for selected publicly traded companies with operations similar to PLX and the application of multiples to corresponding PLX financial and operating measures.

PETRIE PARKMAN & Co.

3—1

Reference Value Analysis Summary

Proposed Transaction Price = $16.75

$12.00 $9.00

$18.50 $15.00

$23.00 $19.00

$17.87 $14.49

$17.38 $15.35

$16.70 $13.46

Methodology

Note: See appendix for reference value analysis detail. Per share ranges based on 24.6 MM fully diluted shares outstanding.

PETRIE PARKMAN & Co.

3—2

Appendices

Reference Value Analysis Detail

DCF Analysis Sensitivities

Standard Definitions

PETRIE PARKMAN & Co.

Reference Value Analysis

Summary of PLX Projections

PLX 2003—2004 Estimates

in millions, except otherwise noted

2003E 1,2 2004E 2,3

Benchmark Commodity Price

NYMEX Oil ($/Bbl) $30.96 $23.00

EBITDA

Midstream 4 $30 $32

Upstream $6 $1

$36 $33

EBIT

Midstream 4 $30 $32

Upstream $2 ($3)

$32 $29

Net Income

Midstream $4 $12

Upstream ($0) ($3)

$3 $9

Throughout this presentation Petrie Parkman used the following assumptions to allocate G&A, book DD&A and debt in computing segment financial measures:

Upstream Midstream

G&A 75% 25%

Book DD&A 100% 0%

Debt 0% 100%

1 Based on PLX estimates as of 1/5/04.

2 Petrie Parkman allocated 25% of total G&A to Midstream and 75% to Upstream, 100% of book DD&A to Upstream and 100% of debt to Midstream.

3 Based on PLX 2004 Operational Plan Growth Case.

4 EBITDA and EBIT include cash distributions from general partner and limited partner interests in PAA.

PETRIE PARKMAN & Co.

4—1

Reference Value Analysis

Fully Diluted Share Calculation

PLX Calculation of Fully Diluted Shares

In thousands, except per share amounts

Current Shares Outstanding 23,768

Restricted Units 137

Dilutive Securities Outstanding 3,811

Total Fully Diluted Shares 27,716

Proposed Transaction Price $16.75

Wtd Avg Exercise Price of Options $13.63

Treasury Method Shares Repurchased (3,102)

Fully Diluted Shares Using the Treasury Method 24,614

Options

Total Exercise Exercisable

Security Shares Price Shares Proceeds

1992 Plan 82 $ 5.20 82 $426

1996 Plan 232 $ 9.14 232 $2,119

2001 Plan 3,467 $ 14.18 3,467 $49,158

Officer Option Plan 30 $ 8.40 30 $252

Total Dilutive Securities 3,811 $ 13.63 3,811 $51,955

Note: Flores and Raymond own 1,475,000 and 725,000 options, respectively (approximately 58% of the total options outstanding).

PETRIE PARKMAN & Co.

4—2

Reference Value Analysis

Commodity Pricing Scenarios

Oil Forecast

WTI NYMEX

PP&Co. Benchmark Oil Price Forecast ($/Bbl) Esc.

Pricing Case 2004 2005 2006 2007 2008 Thereafter

Pricing Case I $ 22.00 $ 22.66 $ 23.34 $ 24.04 $ 24.76 3.0%

Pricing Case II $ 24.00 $ 24.72 $ 25.46 $ 26.23 $ 27.01 3.0%

Pricing Case III $ 26.00 $ 26.78 $ 27.58 $ 28.41 $ 29.26 3.0%

Strip Pricing (esc.) $ 32.34 $ 29.08 $ 27.71 $ 26.90 $ 26.75 3.0%

Strip Pricing (flat) $ 32.34 $ 29.08 $ 27.71 $ 26.90 $ 26.75 0.0%

Strip Pricing as of 2/13/04. Benchmark pricing cases I, II, and III of $22.00, $24.00 and $26.00/Bbl. for oil, were escalated at 3% per year starting in 2005. Strip Pricing cases reflect actual prices from 1/1/04 through 2/13/04. The Strip Pricing (Esc.) Case was escalated annually following 2008 at the rate of 3%. Adjustments were made to the above benchmarks based on the historical relationship between the benchmarks and PLX’s realized prices.

PETRIE PARKMAN & Co.

4—3

Reference Value Analysis

1

Proposed Transaction Price = $16.75

$12.00 $9.00

$18.50 $15.00

$23.00 $19.00

$17.87 $14.49

$17.38 $15.35

$16.70 $13.46

Methodology

Note: Based on 24.6 MM fully diluted shares outstanding.

PETRIE PARKMAN & Co.

4—4

Reference Value Analysis

Discounted Cash Flow / Going Concern Analysis

Methodology: After-tax discounted cash flow analysis based upon projected unlevered free cash flows for

2004 – 2013 plus a terminal value using 7.0—9.0x multiple of estimated 2013 EBITDA.

Discount Rates: After-tax discount rates of 8.0%—12.0% were utilized.

Oil and Gas Pricing: Based upon Petrie Parkman Escalated Strip Benchmark pricing scenario.

Operating Projections: Based upon detailed 2004 – 2008 Florida property projections provided by PLX, 2004 – 2013

PLX projections provided by PLX, illustrative four-year PAA projections provided by PAA to Petrie Parkman and Vulcan, and PAA projections prepared by PAA for the PAA Bank Group and reviewed by Petrie Parkman.

Three cases of operating projections were analyzed. See assumptions below (note: all cases assume $158 MM Capline acquisition in 2004):

Assumptions Low Case Mid Case High Case

PAA Base Assumptions

Organic growth 2% 2% 2%

Cost Escalation 2% 2% 2%

Distribution Coverage 104% 104% 104%

PAA Acquisition Assumptions

Acquisitions Per Year $0 $150 $250

Acquisition Multiple of EBITDA N/A 7.5x 7.5x

% Debt Financing N/A 50% 50%

Cost of Debt N/A 6.0% 6.0%

Maintenance Capex (% of EBITDA) N/A 2.0% 2.0%

PETRIE PARKMAN & Co.

4—5

Reference Value Analysis

LP unit annual distribution is a key measure of MLP performance:

Historical MLP Unit Distribution Growth Rates

3 Year LP Distribution CAGR

3 Year GP Distribution CAGR

5 Year LP Distribution CAGR

5 Year GP Distribution CAGR

Note: LP unit distribution growth rates calculated based on 3Q03 announced distributions. GP distribution growth based on Company filings and PPC estimates. PAA 5-Year GP distribution growth based on 1999 – 2003 PPC estimates.

PETRIE PARKMAN & Co.

4—6

Reference Value Analysis

Petrie Parkman compared its Low, Mid and High Cases to certain projections provided by PLX and PAA. These cases are summarized below:

Scenario

Description

PAA summary projections per May 27, 2003 PLX Board Materials

PAA B

$300 MM annual acquisition capital spending

Cases provided to Vulcan by PAA

PAA V1

5.0% annual LP unit distribution growth, 0% organic growth in PAA PAA V2

5.0% annual LP unit distribution growth, 2% organic growth in PAA

PAA V3

7.5% annual LP unit distribution growth, 0% organic growth in PAA

PAA V4

7.5% annual LP unit distribution growth, 2% organic growth in PAA

PAA V5

10.0% annual LP unit distribution growth, 0% organic growth in PAA

PAA V6

10.0% annual LP unit distribution growth, 2% organic growth in PAA

Cases provided to PAA Bank Group by PAA

PAA Bank Base

2% organic growth in PAA; no acquisitions

PAA Bank Growth

2% organic growth in PAA; $250 MM annual acquisition capital spending

Petrie Parkman Discounted Cash Flow / Going Concern Cases

PPC Low Case

2% organic growth in PAA; no acquisitions

PPC Mid Case

2% organic growth in PAA; $150 MM annual acquisition capital spending

PPC High Case

2% organic growth in PAA; $250 MM annual acquisition capital spending

PETRIE PARKMAN & Co.

4—7

Reference Value Analysis

Summary of Projections – Net to PLX (sorted by Total PLX distributions)

PAA Projection Assumptions 2006 PAA Projected Net Distributions to PLX

Avg. Annual

Acquisition Distributions Net to PLX Total PLX 2003-2006

Scenario 2003-2006 PAA Growth CapEx LP GP Distributions CAGR

LP Distribution Organic ($MM) ($/unit) ($ MM) ( $MM) ($ MM)

PAA Bank Base N/A / 2.0% $ 0 $ 2.20 $ 27.3 $ 3.5 $ 30.8 -0.1%

PPC—Low Case N/A / 2.0% $ 0 $ 2.34 $ 29.0 $ 4.8 $ 33.8 3.0%

PAA Bank Growth N/A / 2.0% $ 250 $ 2.50 $ 31.0 $ 7.0 $ 38.0 7.1%

PAA V2 5.0% / 2.0% $ 103 $ 2.55 $ 31.6 $ 6.8 $ 38.4 7.5%

PPC—Mid Case 4.9% / 2.0% $ 150 $ 2.54 $ 31.5 $ 7.1 $ 38.7 7.7%

PAA V1 5.0% / 0.0% $ 175 $ 2.55 $ 31.6 $ 7.2 $ 38.8 7.9%

PAA V4 7.5% / 2.0% $ 211 $ 2.73 $ 33.9 $ 9.8 $ 43.7 12.2%

PPC—High Case 7.3% / 2.0% $ 250 $ 2.72 $ 33.7 $ 9.7 $ 43.5 12.0%

PAA V3 7.5% / 0.0% $ 292 $ 2.73 $ 33.9 $ 10.3 $ 44.2 12.6%

PLX Board N/A / 0.0% $ 300 $ 2.77 $ 34.3 $ 11.5 $ 45.8 14.0%

PAA V6 10.0% / 2.0% $ 392 $ 2.93 $ 36.3 $ 17.1 $ 53.4 20.0%

PAA V5 10.0% / 0.0% $ 487 $ 2.93 $ 36.3 $ 18.1 $ 54.4 20.7%

PETRIE PARKMAN & Co.

4—8

Reference Value Analysis

Discounted Cash Flow Analysis

Low Case 1

PLX Discounted Cash Flow Analysis

$            in millions, except per share 2003-2013

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 CAGR

Distributions Received from PAA $ 30.9 $ 31.9 $ 32.8 $ 33.8 $ 34.8 $ 35.8 $ 36.8 $ 37.9 $ 39.0 $ 40.0 $ 41.2 2.9%

Upstream Operating Cash Flow 8.8 5.5 3.6 3.9 5.6 3.7 4.0 4.2 4.5 4.8 5.1 -5.3%

% of Total Operating Cash Flow 22% 15% 10% 10% 14% 9% 10% 10% 10% 11% 11%

Less: G&A (6.3) (4.8) (4.9) (5.0) (5.1) (5.2) (5.3) (5.4) (5.5) (5.6) (5.7)

EBITDA $ 33.4 $ 32.6 $ 31.5 $ 32.7 $ 35.3 $ 34.3 $ 35.5 $ 36.7 $ 38.0 $ 39.2 $ 40.6 2.0%

Unlevered Cash Taxes (3.5) (4.1) (3.7) (4.1) (6.4) (6.6) (7.6) (8.1) (8.6) (9.0) (9.5)

After-tax Cash Flow $ 29.9 $ 28.5 $ 27.8 $ 28.5 $ 28.8 $ 27.7 $ 27.8 $ 28.6 $ 29.4 $ 30.2 $ 31.1

Capital Expenditures (5.7) (3.7) (2.5) (2.0) (1.8) (1.5) (1.5) (1.6) (1.6) (1.6) (1.7)

Changes in Net Working Capital (0.6) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Unlevered Free Cash Flow $ 23.7 $ 24.8 $ 25.3 $ 26.6 $ 27.0 $ 26.2 $ 26.3 $ 27.0 $ 27.8 $ 28.6 $ 29.4 2.2%

Equity Reference Value Range ($/Sh.) 1

Discount Terminal Multiple of EBITDA

Rate 7.0x 7.5x 8.0x 8.5x 9.0x

12.0% $ 8.45 $ 8.74 $ 9.02 $ 9.30 $ 9.58

11.0% $ 9.05 $ 9.36 $ 9.67 $ 9.97 $ 10.28

10.0% $ 9.70 $ 10.04 $ 10.37 $ 10.70 $ 11.04

9.0% $ 10.41 $ 10.77 $ 11.14 $ 11.50 $ 11.86

8.0% $ 11.18 $ 11.58 $ 11.97 $ 12.37 $ 12.77

Equity Reference Value Range $/Share $ 9.00 - $ 12.00

1 Based on 24.6 MM fully diluted shares outstanding

PETRIE PARKMAN & Co.

4—9

Reference Value Analysis

Discounted Cash Flow Analysis

Low Case

Summary PAA Projections

Summary PAA Projections

$            in millions, except per unit 2003-2013

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 CAGR

Base EBITDA $ 174 $ 178 $ 182 $ 185 $ 189 $ 193 $ 197 $ 201 $ 205 $ 209 $ 213 2.0%

Acquisition EBITDA $ 0 $ 19 $ 19 $ 20 $ 20 $ 21 $ 21 $ 21 $ 22 $ 22 $ 23

Total EBITDA $ 174 $ 197 $ 201 $ 205 $ 209 $ 213 $ 218 $ 222 $ 227 $ 231 $ 236 3.1%

Maintenance Capex (9) (13) (13) (14) (14) (14) (15) (15) (15) (15) (16)

Interest Expense (35) (37) (37) (37) (37) (37) (37) (37) (37) (37) (37)

Avail. Distributable Cash Flow $ 131 $ 147 $ 150 $ 154 $ 158 $ 162 $ 166 $ 170 $ 174 $ 178 $ 183

PAA Distributable Cash Flow $ 130 $ 141 $ 145 $ 148 $ 152 $ 156 $ 160 $ 164 $ 168 $ 172 $ 176 3.1%

GP Distribution $ 8 $ 9 $ 10 $ 11 $ 12 $ 13 $ 14 $ 15 $ 16 $ 17 $ 18 8.5%

LP Distribution $ 122 $ 132 $ 135 $ 137 $ 140 $ 143 $ 146 $ 149 $ 152 $ 155 $ 158 2.6%

per unit $ 2.20 $ 2.24 $ 2.29 $ 2.34 $ 2.38 $ 2.43 $ 2.48 $ 2.53 $ 2.58 $ 2.63 $ 2.69 2.0%

LP Growth Rate 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%

GP Distributions to PLX $ 3 $ 4 $ 4 $ 5 $ 5 $ 6 $ 6 $ 7 $ 7 $ 7 $ 8 8.5%

LP Distributions to PLX $ 27 $ 28 $ 28 $ 29 $ 30 $ 30 $ 31 $ 31 $ 32 $ 33 $ 33 2.0%

Total Distributions to PLX $ 31 $ 32 $ 33 $ 34 $ 35 $ 36 $ 37 $ 38 $ 39 $ 40 $ 41

PAA Annual Acquisitions $ 158 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0

PETRIE PARKMAN & Co.

4—10

Reference Value Analysis

Discounted Cash Flow Analysis

Mid Case 1

PLX Discounted Cash Flow Analysis

$            in millions, except per share

2003-2013

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 CAGR

Distributions Received from PAA $ 30.9 $ 31.9 $ 35.3 $ 38.7 $ 42.1 $ 46.1 $ 50.3 $ 54.4 $ 58.6 $ 62.8 $ 67.6 8.1%

Upstream Operating Cash Flow 8.8 5.5 3.6 3.9 5.6 3.7 4.0 4.2 4.5 4.8 5.1 -5.3%

% of Total Operating Cash Flow 22% 15% 9% 9% 12% 7% 7% 7% 7% 7% 7%

Less: G&A (6.3) (4.8) (4.9) (5.0) (5.1) (5.2) (5.3) (5.4) (5.5) (5.6) (5.7)

EBITDA $ 33.4 $ 32.6 $ 34.0 $ 37.6 $ 42.5 $ 44.6 $ 48.9 $ 53.3 $ 57.6 $ 62.0 $ 67.0 7.2%

Unlevered Cash Taxes (3.5) (4.1) (3.8) (4.0) (5.5) (6.3) (7.6) (8.5) (9.4) (10.3) (12.0)

After-tax Cash Flow $ 29.9 $ 28.5 $ 30.2 $ 33.6 $ 37.0 $ 38.4 $ 41.3 $ 44.8 $ 48.2 $ 51.7 $ 55.0

Capital Expenditures (5.7) (3.7) (3.2) (2.6) (2.5) (2.2) (2.2) (2.2) (2.3) (2.3) (2.3)

Changes in Net Working Capital (0.6) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Unlevered Free Cash Flow $ 23.7 $ 24.8 $ 27.1 $ 31.0 $ 34.5 $ 36.2 $ 39.1 $ 42.6 $ 46.0 $ 49.4 $ 52.6 8.3%

Equity Reference Value Range ($/Sh.) 1

Discount Terminal Multiple of EBITDA

Rate 7.0x 7.5x 8.0x 8.5x 9.0x

12.0% $ 13.20 $ 13.66 $ 14.13 $ 14.59 $ 15.05

11.0% $ 14.16 $ 14.66 $ 15.17 $ 15.67 $ 16.18

10.0% $ 15.20 $ 15.75 $ 16.30 $ 16.85 $ 17.40

9.0% $ 16.33 $ 16.93 $ 17.53 $ 18.13 $ 18.73

8.0% $ 17.56 $ 18.22 $ 18.87 $ 19.53 $ 20.18

Equity Reference Value Range $/Share $ 15.00 - $ 18.50

1 Based on 24.6 MM fully diluted shares outstanding

PETRIE PARKMAN & Co.

4—11

Reference Value Analysis

Discounted Cash Flow Analysis

Mid Case

Summary PAA Projections

Summary PAA Projections

$            in millions, except per unit

2003-2013

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 CAGR

Base EBITDA $ 174 $ 178 $ 182 $ 185 $ 189 $ 193 $ 197 $ 201 $ 205 $ 209 $ 213 2.0%

Acquisition EBITDA $ 0 $ 19 $ 39 $ 60 $ 80 $ 101 $ 121 $ 141 $ 162 $ 182 $ 203

Total EBITDA $ 174 $ 197 $ 221 $ 245 $ 269 $ 293 $ 318 $ 342 $ 367 $ 391 $ 416 9.1%

Maintenance Capex (9) (13) (14) (14) (15) (16) (17) (17) (18) (19) (19)

Interest Expense (35) (37) (42) (46) (51) (55) (60) (64) (69) (73) (78)

Avail. Distributable Cash Flow $ 131 $ 147 $ 166 $ 184 $ 203 $ 222 $ 241 $ 261 $ 280 $ 299 $ 319

PAA Distributable Cash Flow $ 130 $ 141 $ 159 $ 177 $ 196 $ 214 $ 232 $ 251 $ 269 $ 288 $ 306 9.0%

GP Distribution $ 8 $ 9 $ 13 $ 16 $ 20 $ 26 $ 33 $ 40 $ 47 $ 55 $ 64 23.3%

LP Distribution $ 122 $ 132 $ 147 $ 161 $ 176 $ 187 $ 199 $ 210 $ 222 $ 233 $ 242 7.1%

per unit $ 2.20 $ 2.24 $ 2.40 $ 2.54 $ 2.69 $ 2.78 $ 2.87 $ 2.96 $ 3.04 $ 3.12 $ 3.18 3.7%

LP Growth Rate 2.0% 6.8% 6.1% 5.6% 3.6% 3.2% 3.0% 2.8% 2.7% 1.7%

GP Distributions to PLX $ 3 $ 4 $ 6 $ 7 $ 9 $ 12 $ 15 $ 18 $ 21 $ 24 $ 28 23.3%

LP Distributions to PLX $ 27 $ 28 $ 30 $ 32 $ 33 $ 35 $ 36 $ 37 $ 38 $ 39 $ 39 3.7%

Total Distributions to PLX $ 31 $ 32 $ 35 $ 39 $ 42 $ 46 $ 50 $ 54 $ 59 $ 63 $ 68

PAA Annual Acquisitions $ 158 $ 150 $ 150 $ 150 $ 150 $ 150 $ 150 $ 150 $ 150 $ 150

PETRIE PARKMAN & Co.

4—12

Reference Value Analysis

Discounted Cash Flow Analysis

High Case 1

PLX Discounted Cash Flow Analysis

$            in millions, except per share

2003-2013

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 CAGR

Distributions Received from PAA $ 30.9 $ 33.4 $ 38.4 $ 43.5 $ 49.5 $ 55.5 $ 61.6 $ 67.6 $ 73.7 $ 79.7 $ 86.7 10.9%

Upstream Operating Cash Flow 8.8 5.5 3.6 3.9 5.6 3.7 4.0 4.2 4.5 4.8 5.1 -5.3%

% of Total Operating Cash Flow 22% 14% 9% 8% 10% 6% 6% 6% 6% 6% 6%

Less: G&A (6.3) (4.8) (4.9) (5.0) (5.1) (5.2) (5.3) (5.4) (5.5) (5.6) (5.7)

EBITDA $ 33.4 $ 34.2 $ 37.1 $ 42.3 $ 50.0 $ 54.0 $ 60.2 $ 66.4 $ 72.7 $ 78.9 $ 86.1 9.9%

Unlevered Cash Taxes (3.5) (4.2) (3.7) (3.9) (5.9) (6.9) (8.5) (9.8) (11.1) (12.5) (15.0)

After-tax Cash Flow $ 29.9 $ 30.0 $ 33.4 $ 38.5 $ 44.1 $ 47.2 $ 51.7 $ 56.6 $ 61.5 $ 66.4 $ 71.1

Capital Expenditures (5.7) (4.1) (3.6) (3.1) (2.9) (2.6) (2.6) (2.7) (2.7) (2.7) (2.8)

Changes in Net Working Capital (0.6) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Unlevered Free Cash Flow $ 23.7 $ 25.9 $ 29.8 $ 35.4 $ 41.1 $ 44.5 $ 49.0 $ 53.9 $ 58.8 $ 63.7 $ 68.4 11.2%

Equity Reference Value Range ($/Sh.) 1

Discount Terminal Multiple of EBITDA

Rate 7.0x 7.5x 8.0x 8.5x 9.0x

12.0% $ 16.81 $ 17.41 $ 18.00 $ 18.60 $ 19.20

11.0% $ 18.03 $ 18.68 $ 19.33 $ 19.98 $ 20.62

10.0% $ 19.35 $ 20.06 $ 20.77 $ 21.47 $ 22.18

9.0% $ 20.79 $ 21.56 $ 22.34 $ 23.11 $ 23.88

8.0% $ 22.37 $ 23.21 $ 24.05 $ 24.89 $ 25.73

Equity Reference Value Range $/Share $ 19.00 - $ 23.00

1 Based on 24.6 MM fully diluted shares outstanding

PETRIE PARKMAN & Co.

4—13

Reference Value Analysis

Discounted Cash Flow Analysis

High Case

Summary PAA Projections

Summary PAA Projections

$            in millions, except per unit

2003-2013

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 CAGR

Base EBITDA $ 174 $ 178 $ 182 $ 185 $ 189 $ 193 $ 197 $ 201 $ 205 $ 209 $ 213 2.0%

Acquisition EBITDA $ 0 $ 31 $ 65 $ 99 $ 132 $ 166 $ 200 $ 234 $ 267 $ 301 $ 335

Total EBITDA $ 174 $ 209 $ 247 $ 284 $ 322 $ 359 $ 397 $ 434 $ 472 $ 510 $ 548 12.1%

Maintenance Capex (9) (13) (14) (15) (16) (17) (18) (19) (20) (21) (22)

Interest Expense (35) (40) (47) (55) (62) (70) (77) (85) (92) (100) (107)

Avail. Distributable Cash Flow $ 131 $ 156 $ 185 $ 214 $ 243 $ 272 $ 301 $ 330 $ 360 $ 389 $ 419

PAA Distributable Cash Flow $ 130 $ 150 $ 178 $ 206 $ 234 $ 261 $ 290 $ 318 $ 346 $ 374 $ 402 12.0%

GP Distribution $ 8 $ 11 $ 16 $ 22 $ 32 $ 43 $ 53 $ 64 $ 74 $ 85 $ 100 28.9%

LP Distribution $ 122 $ 139 $ 162 $ 183 $ 201 $ 219 $ 236 $ 254 $ 271 $ 289 $ 303 9.5%

per unit $ 2.20 $ 2.31 $ 2.53 $ 2.72 $ 2.85 $ 2.97 $ 3.08 $ 3.19 $ 3.30 $ 3.40 $ 3.46 4.6%

LP Growth Rate 5.1% 9.3% 7.6% 4.7% 4.2% 3.9% 3.5% 3.3% 3.1% 1.8%

GP Distributions to PLX $ 3 $ 5 $ 7 $ 10 $ 14 $ 19 $ 23 $ 28 $ 33 $ 38 $ 44 28.9%

LP Distributions to PLX $ 27 $ 29 $ 31 $ 34 $ 35 $ 37 $ 38 $ 40 $ 41 $ 42 $ 43 4.6%

Total Distributions to PLX $ 31 $ 33 $ 38 $ 43 $ 49 $ 56 $ 62 $ 68 $ 74 $ 80 $ 87

PAA Annual Acquisitions $ 250 $ 250 $ 250 $ 250 $ 250 $ 250 $ 250 $ 250 $ 250 $ 250

PETRIE PARKMAN & Co

4—14

Reference Value Analysis

Comparable Transaction Analysis

PLX Transaction Enterprise Reference

Measure Data ($MM) Parameters Value Range ($MM)

Midstream Assets

Purchase Price / LTM 9/30/03 Net Income 1 $ 7 20.0 - 25.0x $ 196 - $ 234

Total Investment / LTM 9/30/03 EBIT 2 $ 30 14.0 - 16.0x 418 - 478

Total Investment / LTM 9/30/03 EBITDA 2 $ 30 11.0 - 14.0x 328 - 418

Composite Midstream Assets Enterprise Reference Value Range $ 375 - $ 450

Florida Properties 3 29 - 37

Composite Enterprise Reference Value Range $ 404 - $ 487

Adjusted for:

Debt at 12/31/03E 4 ( $ 50) - ( $ 50)

Net Working Capital at 12/31/03E 4 3 - 3

Equity Reference Value Range $ 357 - $ 440

Equity Reference Value Range—$            per Share 5 $ 14.49 - $ 17.87

1 Enterprise Reference Value Range adjusted for debt of $50 MM and net working capital of $3 MM.

2 EBITDA and EBIT include cash distributions from general partner and limited partner interests in PAA.

3 See page 4—20.

4 Based on PLX estimates dated 1/5/04.

5 Based on 24.6 MM fully diluted shares outstanding.

PETRIE PARKMAN & Co.

4—15

Reference Value Analysis

Comparable Transaction Analysis

Transaction Parameters Summary

1

Transaction Parameters Summary

Purchase Total Investment /

Number of Price / LTM LTM

Deal Type Transactions Review Period LTM Net Inc. EBIT EBITDA 1

Midstream Corporate 15 1997—2004 YTD Mean 24.2x 16.4x 13.0x

Median 23.2x 15.5x 10.9x

Midstream Asset 43 2001—2004 YTD Mean - - 8.2x

Median - - 8.1x

General Partner 11 1996—2004 YTD Mean - - 16.9x

Median - - 10.5x

1 LTM EBITDA multiple for General Partner transactions based on annualized distributions.

PETRIE PARKMAN & Co.

4—16

Reference Value Analysis

Comparable Transaction Analysis

Midstream Corporate Transactions

Selected Corporate Midstream Transactions and Offers for Control

Purchase Purchase Total Total Investment /

Date Price Price / Investment LTM LTM

Announced Acquiror Target $MM LTM Net Inc. $MM EBIT EBITDA

1 09/20/01 Duke Energy Corp. Westcoast Energy Inc. $ 3,443 12.5x $ 8,713 15.6x 10.5x

2 03/16/01 Enbridge Inc. Midcoast Energy Resources Inc. 337 20.0x 583 14.7x 10.8x

3 01/15/00 El Paso Energy Corporation Coastal Corporation 9,759 19.6x 15,377 15.4x 10.4x

4 07/08/99 KN Energy, Inc. Kinder Morgan Energy, Inc. 521 20.3x 664 13.7x 13.4x

5 05/18/99 NiSource Inc. Columbia Energy Group 5,623 23.2x 8,037 15.2x 11.4x

6 04/18/99 Columbia Energy Group Consolidated Natural Gas 6,678 28.0x 9,016 18.1x 10.9x

7 03/15/99 El Paso Energy Sonat Inc. 3,528 25.6x 5,451 16.3x 8.0x

8 02/22/99 Dominion Resources Inc. Consolidated Natural Gas 6,354 26.6x 8,692 17.5x 10.5x

9 02/22/99 Sempra Energy Inc. KN Energy Inc. 1,741 27.6x 5,974 17.1x 10.9x

10 08/02/98 CMS Energy Corp. Continental Natural Gas 64 NM 155 NM 39.6x

11 03/02/98 El Paso Energy Corporation Deeptech International Inc. 292 NM 388 NM 13.4x

12 01/26/98 TransCanada Pipelines Ltd. Nova Corporation 7,090 14.3x 8,021 12.4x 8.2x

13 11/24/97 The Williams Cos. Mapco Inc. 2,532 14.1x 3,350 14.9x 10.9x

14 10/22/97 Koch Industries USX-Delhi 198 44.7x 762 26.0x 14.3x

15 09/23/97 Shell Oil Company Tejas Gas Corporation 1,265 38.3x 2,132 N/A 12.1x

Max $ 9,759 44.7x $ 15,377 26.0x 39.6x

Mean 3,295 24.2x 5,154 16.4x 13.0x

Median 2,532 23.2x 5,451 15.5x 10.9x

Min 64 12.5x 155 12.4x 8.0x

Note:

Purchase Price = Purchase Price of Equity

Total Investment = Purchase Price + Long Term Debt + Preferred Stock + Minority Interest—Working Capital N/A = Not available NM = Not material

PETRIE PARKMAN & Co.

4—17

Reference Value Analysis

Comparable Transaction Analysis

Midstream Asset Transactions

Selected Midstream Asset Transactions

Total Total

Date Investment Investment /

Announced Acquiror Target $ MM LTM EBITDA

1 12/22/03 Enbridge Energy Partners, L.P. Mid-Continent Crude Pipeline and Storage (Shell Pipeline) $ 141 5.6x

2 12/16/03 Plains All American Pipeline, LP Interest in Capline / Capwood Pipeline Systems (Shell Pipeline) 158 8.3x

3 11/19/03 Enbridge Energy Partners, L.P. North Texas System (Cantera Resources) 247 8.0x

4 11/18/03 Markwest Energy Partners, LP American Central Western Oklahoma Gas Company 38 14.6x

5 11/07/03 Markwest Energy Partners, LP Michigan Crude Gathering Pipeline (Shell) 21 8.4x

6 09/10/03 Provident Energy Trust Redwater Canadian NGL Unit (Williams) 206 7.6x

7 05/13/03 Loews Corporation Texas Gas Transmission Pipeline (Williams) 1,045 7.1x

8 05/02/03 Cantera Resources CMS Field Services 165 4.7x

9 05/02/03 Crosstex Energy L.P. Midstream Assets (Duke) 66 6.0x

10 03/25/03 Markwest Energy Partners, LP Pinnacle Natural Gas 40 7.4x

11 03/20/03 Fort Chicago Partners/ Enbridge Energy Alliance Pipeline Ltd (Duke) 264 4.5x

12 12/22/02 Southern Union Co. & AIG Highstar Capital Panhandle Eastern Pipeline Company (CMS Energy) 1,828 8.6x

13 11/19/02 BC Gas Inc. / Inter Pipeline Fund Interest in Cold Lake Pipeline/Express Pipeline (EnCana) 1,011 11.4x

14 11/12/02 Sunoco Logostics Partners L.P. West Texas Gulf Pipeline Company 11 8.2x

15 11/08/02 Northern Border Partners, L.P. Viking Gas Transmission / Interest in Guardian (Xcel Energy) 152 6.8x

16 10/31/02 Sunoco Logostics Partners L.P. Petroleum Products Pipelines (Unocal) 54 10.0x

17 10/21/02 Kinder Morgan Inc. 50% Interest in TransColorado Pipeline ( Questar Corp.) 106 9.6x

18 10/16/02 ONEOK Inc. Gas Distribution Assets (Southern Union) 420 7.5x

19 10/11/02 Enbridge Inc. Alliance Pipeline Ltd 368 4.9x

20 10/03/02 National Fuel Gas Co. Empire State Pipeline (Duke Energy) 240 8.0x

21 10/03/02 Koch Industries Inc. Interest in Colonial Pipeline (BP) 295 4.4x

22 09/23/02 Enbridge Energy Partners, L.P. Enbridge Midcoast Energy Co. (Enbridge Energy Co.) 820 14.9x

23 09/16/02 AIG Highstar Capital, L.P. Central Pipeline (Williams Cos.) 555 7.3x

24 08/26/02 Williams Energy Partners L.P. Refined Petroleum Products Pipeline (Tesoro) 110 7.3x

25 08/01/02 Enterprise Products Partners L.P. Mapletree LLC and Oaktree LLC (Williams Cos.) 1,200 10.4x

26 07/29/02 MidAmerican Energy Holdings Northern Natural Pipeline Company (Dynegy) 1,878 7.2x

27 05/30/02 El Paso Energy Partners San Juan Assets (El Paso Corp.) 782 8.7x

28 05/28/02 TEPPCO Partners, L.P. Val Verde Gathering System (Burlington Resources) 444 8.5x

29 05/06/02 Plains All American Pipeline, LP W. TX Crude Pipeline Assets (Shell Pipeline Co.) 315 10.5x

30 04/11/02 Williams Energy Partners L.P. Williams Pipeline Company LLC 1,000 9.5x

31 03/27/02 MidAmerican Energy Holdings Kern River Gas Transmission Company (Williams Cos.) 956 5.9x

32 02/19/02 El Paso Energy Partners EPN Holding Co. (El Paso Corp.) 735 8.2x

33 01/31/02 Dynegy Inc. Northern Natural Pipeline Company (Enron) 2,473 9.5x

34 01/09/02 TEPPCO Partners, L.P. Chaparral Pipeline / Quanah Pipeline (Valero and Koch) 130 8.1x

35 12/17/01 Kinder Morgan Energy Partners, L.P. Tejas Gas, LLC 750 7.8x

36 11/27/01 Undisclosed South Texas, Gulf Coast Gathering Assets 32 8.2x

37 11/01/01 Pembina Pipeline Income Fund Alberta Oil Sands Pipeline Ltd. 141 11.3x

38 10/25/01 Enbridge Energy Partners, L.P. East Texas System (Koch Midstream Services) 231 8.2x

39 09/10/01 TEPPCO Partners, L.P. Jonah Gas Gathering Company 360 8.0x

40 07/18/01 Undisclosed Gulf of Mexico Gathering Assets 71 6.2x

41 05/07/01 Northern Border Partners, L.P. Midwestern Gas Transmission (El Paso) 100 8.8x

42 03/08/01 Lakehead Pipeline Partners, L.P. The North Dakota Pipeline System (Enbridge) 33 6.0x

43 03/01/01 Plains All American Pipeline, LP Canadian Pipeline Trucking, Terminals (Murphy Oil) 161 9.4x

Max $ 2,473 14.9x

Mean 469 8.2x

Median 240 8.1x

Note: Min 11 4.4x

Total Investment = Purchase Price + Long Term Debt + Preferred Stock + Minority Interest—Working Capital

PETRIE PARKMAN & Co.

4—18

Reference Value Analysis

Comparable Transaction Analysis

General Partner Transactions

Selected GP Transactions

Total

Total Investment/

Date Investment Annualized GP Split

Announced Acquiror Target GP (Seller) $MM Distribution Level

1 12/22/03 Investor Group Natural Resource Partners GP (Arch Coal) $ 4 9.5x Lowest

2 12/15/03 El Paso Corporation Gulfterra GP (Goldman) 125 14.9x Highest

3 12/15/03 Enterprise Products Partners Gulfterra GP (El Paso) 425 10.0x Highest

4 10/03/03 Goldman Sachs Gulfterra GP (El Paso) 88 10.5x Highest

5 04/21/03 Madison Dearborn Partners & others Magellan Midstream Partners GP (Williams) 65 12.4x 3 of 4

6 08/16/02 TransCanada Pipeline Limited Northern Border Partners GP (Williams) 12 6.9x 3 of 4

7 06/08/01 Investor Group Plains All American GP (Plains Resources) 41 47.8x 2 of 4

8 04/27/99 Suburban Propane Partners Suburban Propane Partners GP (Millennium Chemicals) 6 6.6x Lowest

9 04/20/99 Shell Oil Company Enterprise GP (Enterprise) 4 8.1x Lowest

10 10/20/97 Kinder Morgan Santa Fe Pacific Pipelines GP (Santa Fe) 84 22.3x Highest

11 03/25/96 Buckeye Management Buckeye GP (American Financial Group) 63 37.3x 3 of 6

Max $ 425 47.8x

Mean 83 16.9x

Median 63 10.5x

Min 4 6.6x

Note: Williams GP Total Investment based on announced purchase price of $510 MM for WMB’s ownership in Williams Energy Partners plus accrued G&A minus the value of the common units and class B units at the market price the day before announcement and the value of the subordinated units at 85% of the market price the day before announcement.

PETRIE PARKMAN & Co.

4—19

Reference Value Analysis

Comparable Transaction Analysis

E&P Property Transactions

E&P Transaction Enterprise Reference

Measure Data Parameters Value Range ($MM)

Florida Properties $/BOE

Proved Reserves (MMBOE) 1 16 $ 2.00 - 2.50 $ 33 - $ 41

Hedging 2 ( $4) - ( $ 4)

Enterprise Reference Value Range for Florida Assets $ 29 - $ 37

1 Based on Netherland, Sewell & Associates, Inc. reserve report as of 12/31/02.

2 Based on the NPV of the Company’s estimated after-tax hedge position at 12/31/03 using discount rates of 10.0 – 12.5% and strip pricing (esc.) case.

PETRIE PARKMAN & Co.

4—20

Reference Value Analysis

Comparable Transaction Analysis

E&P Property Transactions

Petrie Parkman reviewed publicly-available information relating to 12 announced oil and gas property transactions and proprietary information relating to 1 oil and gas property transaction between January 1998 and February 2004 in California and the Gulf Coast region to determine the transaction parameters relevant for an analysis of PLX.

The number of transactions reviewed and the range of purchase price of reserves per unit of equivalent proved reserves (6:1 Mcf to Bbl basis) are as follows:

1998—2004 YTD Selected Transactions

Proved Percent Purchase Purchase Price to:

Reserves Oil Price Reserves Reserves

Date Buyer Seller (MMBOE) (%) ($MM) ($/BOE) ($/Mcfe) Region State(s)

1 7/9/02 Rising Star Energy LLC Seitel, Inc. 9 32% $ 40 $ 4.38 $ 0.73 West Coast CA

2 9/4/01 Undisclosed Coho Energy, Inc. 30 98% 80 2.66 $ 0.44 Gulf Coast MS

3 1/1/01 Patina Oil & Gas Corp. Elysium Energy Partners 13 90% 48 3.57 $ 0.60 West Coast CA

4 10/17/00 Undisclosed Bellweather Exploration 3 N/A 22 7.33 $ 1.22 Gulf Coast AL

5 6/6/00 Tartan Energy Albatross Oil and Gas Company 1 100% 7 5.15 $ 0.86 West Coast CA

6 11/18/99 Undisclosed Undisclosed 88 N/A 107 1.22 $ 0.20 West Coast CA

7 8/16/99 Denbury Resources Undisclosed 6 100% 13 2.21 $ 0.37 Gulf Coast MS

8 6/29/99 Nuevo Energy Corp. Texaco Inc. 34 100% 61 1.81 $ 0.30 West Coast CA

9 4/1/99 Plains Resources Inc. Aera Energy LLC 7 100% 8 1.10 $ 0.18 West Coast CA

10 1/11/99 Naftex Operating Co. Chevron Corp. 5 N/A 13 2.52 $ 0.42 West Coast CA

11 12/23/98 Berry Petroleum Co. Aera Energy LLC 13 100% 35 2.69 $ 0.45 West Coast CA

12 8/3/98 Berry Petroleum Co. Occidental Petroleum 1 100% 3 2.38 $ 0.40 West Coast CA

13 2/5/98 Occidental Petroleum Corp. U.S. Government 1,000 N/A 3,650 3.65 $ 0.61 West Coast CA

Max 1,000 100% $ 3,650 $ 7.33 $ 1.22

Mean 93 91% 314 3.13 $ 0.52

Median 9 100% 35 2.66 $ 0.44

Min 1 32% 3 1.10 $ 0.18

PETRIE PARKMAN & Co.

4—21

Reference Value Analysis

Premium Analysis

PLX Transaction Enterprise Reference

Measure Data Parameters Value Range ($MM)

Premium Analysis 1,2

1 day prior $ 13.44 15% - 25% $ 428 - $ 461

30 days prior $ 13.30 25% - 35% 456 - 489

60 days prior $ 12.58 20% - 30% 419 - 450

Composite Enterprise Reference Value Range $ 425 - $ 475

Adjusted for:

Long-Term Debt at 12/31/03E 3 ( $ 50) - ( $ 50)

Net Working Capital at 12/31/03E 3 3 - 3

Equity Reference Value Range ($ MM) $ 378 - $ 428

Equity Reference Value Range—$            per Share 4 $ 15.35 - $ 17.38

1 Enterprise Reference Value Range adjusted for debt of $50 MM and net working capital of $3 MM.

2 PLX stock prices based on unaffected share price prior to Vulcan offer after market close on 11/20/03.

3 Based on PLX estimates dated 1/5/04.

4 Based on 24.6 MM fully diluted shares outstanding.

PETRIE PARKMAN & Co.

4—22

Reference Value Analysis

Premium Analysis

Midstream Corporate Transactions

Selected Corporate Midstream Transactions and Offers for Control

Stock Premium

Date Day(s) Prior

Announced Acquiror Target 1 30 60

1 09/20/01 Duke Energy Corp. Westcoast Energy Inc. 15.5% 17.3% 19.9%

2 03/16/01 Enbridge Inc. Midcoast Energy Resources Inc. 7.1% 19.5% 22.0%

3 01/15/00 El Paso Energy Corporation Coastal Corporation 26.8% 30.0% 13.8%

4 07/08/99 KN Energy, Inc. Kinder Morgan Energy, Inc. N/A N/A N/A

5 05/18/99 NiSource Inc. Columbia Energy Group 22.0% 35.3% 34.5%

6 04/18/99 Columbia Energy Group Consolidated Natural Gas 33.5% 31.9% 33.5%

7 03/15/99 El Paso Energy Sonat Inc. 18.2% 27.9% 25.1%

8 02/22/99 Dominion Resources Inc. Consolidated Natural Gas 18.4% 29.6% 24.2%

9 02/22/99 Sempra Energy Inc. KN Energy Inc. 16.3% 9.9% -2.7%

10 08/02/98 CMS Energy Corp. Continental Natural Gas 10.3% 44.8% 55.9%

11 03/02/98 El Paso Energy Corporation Deeptech International Inc. 8.7% 2.8% 21.7%

12 01/26/98 TransCanada Pipelines Ltd. Nova Corporation 6.0% 15.2% 15.9%

13 11/24/97 The Williams Cos. Mapco Inc. 21.1% 39.3% 34.3%

14 10/22/97 Koch Industries USX-Delhi 27.0% 47.7% 67.6%

15 09/23/97 Shell Oil Company Tejas Gas Corporation 23.0% 33.8% 38.7%

Max 33.5% 47.7% 67.6%

Mean 18.1% 27.5% 28.9%

Median 18.3% 29.8% 24.7%

Min 6.0% 2.8% -2.7%

PETRIE PARKMAN & Co.

4—23

Reference Value Analysis

Capital Market Comparison

12345

PLX Transaction Enterprise Reference

Measure Data ($MM) Parameters Value Range ($MM)

Midstream Assets

Market Value / LTM 9/30/03 Net Income 1 $ 7 15.0 - 20.0x $ 167 - $ 204

Market Value / 2003E Net Income 1,2 $ 4 13.0 - 18.0x 101 - 119

Market Value / 2004E Net Income 1,2 $ 12 15.0 - 20.0x 233 - 293

Enterprise Value / LTM 9/30/03 OCF 3 $ 32 10.0 - 12.0x 316 - 380

Enterprise Value / LTM 9/30/03 EBIT 3 $ 30 12.0 - 16.0x 358 - 478

Enterprise Value / LTM 9/30/03 EBITDA 3 $ 30 11.0 - 14.0x 328 - 418

Enterprise Value / 2003E EBITDA 2,3 $ 30 10.0 - 12.0x 301 - 361

Enterprise Value / 2004E EBITDA 2,3 $ 32 8.5 - 11.0x 275 - 356

Composite Midstream Assets Enterprise Reference Value Range $ 350 - $ 425

Florida Properties 4 37 - 41

Composite Enterprise Reference Value Range $ 387 - $ 466

Adjusted for:

Debt at 9/30/03 ( $ 55) - ($ 55)

Net Working Capital at 9/30/03 (0) - (0)

Equity Reference Value Range $ 331 - $ 411

Equity Reference Value Range—$            per Share 5 $ 13.46 - $ 16.70

1 Enterprise Reference Value Range adjusted for debt of $55 MM and net working capital of ($0) MM.

2 2003E Net Income and EBITDA based on PLX estimates dated 1/5/04; 2004E Net Income and EBITDA based on PLX 2004 Operational Plan Growth Case.

3 OCF, EBITDA and EBIT include cash distributions from general partner and limited partner interests in PAA.

4 Based on discounted cash flow analysis of Florida properties using Strip Pricing (esc.) Case. See page 4—27.

5 Based on 24.6 MM fully diluted shares outstanding.

PETRIE PARKMAN & Co.

4—24

Reference Value Analysis

Capital Market Comparison

Midstream Companies

Selected Midstream Companies

A B C D E F G H I J K L M N

% of MARKET VALUE TO: ENTERPRISE VALUE TO:

Current 52 Week Market Net Income Ent. OCF EBIT EBITDA

Price Yield High Value LTM 03E 04E Value LTM LTM LTM 03E 04E

$/Unit $MM x x x $MM x x x x x

CROSSTEX ENERGY INC. $ 31.60 3.8% 93% $ 369 N/M N/M 58.5x $ 503 13.0x 34.4x 17.3x 13.5x 11.2x

DYNEGY INC. $ 4.30 0.0% 79% $ 1,621 N/M N/M N/M $ 7,549 9.3x N/M 21.8x 5.9x 7.4x

EL PASO ENERGY CORP. $ 8.57 1.9% 87% $ 5,137 N/M N/M 26.0x $ 26,473 5.8x N/M 14.1x 8.2x 8.3x

KANEB SERVICES LLC $ 31.69 5.6% 93% $ 365 12.7x N/A N/A $ 1,392 6.8x 11.2x 7.9x N/A N/A

KINDER MORGAN, INC. $ 60.29 2.7% 96% $ 7,430 20.1x 18.1x 16.2x $ 11,801 13.0x 16.4x 14.1x 12.0x 11.0x

MARKWEST HYDROCARBON $ 10.86 0.0% 83% $ 102 N/M N/M N/M $ 234 12.0x N/M N/M N/A N/A

ONEOK $ 22.42 3.2% 96% $ 1,822 10.9x 10.7x 11.0x $ 3,677 6.5x 8.9x 6.5x 6.0x 6.1x

QUESTAR CORP $ 35.81 2.3% 97% $ 2,974 14.1x 15.6x 14.9x $ 4,049 7.3x 11.2x 7.3x 7.4x 6.9x

TRANSCANADA $ 20.67 4.0% 94% $ 9,973 18.2x 16.2x 16.3x $ 18,707 8.0x 11.2x 8.0x 7.6x 7.7x

WESTERN GAS RES $ 48.20 0.4% 96% $ 1,602 21.4x 19.4x 19.4x $ 1,906 5.9x 9.0x 6.6x 7.7x 7.4x

WILLIAMS COMPANIES $ 10.14 0.4% 88% $ 5,254 27.2x N/M 23.6x $ 13,369 4.5x 8.5x 5.6x 7.0x 7.3x

Max 5.6% 97% $ 9,973 27.2x 19.4x 58.5x $ 26,473 13.0x 34.4x 21.8x 13.5x 11.2x

Mean 2.2% 91% $ 3,332 17.8x 16.0x 23.2x $ 8,151 8.4x 13.9x 10.9x 8.4x 8.1x

Median 2.3% 93% $ 1,822 18.2x 16.2x 17.9x $ 4,049 7.3x 11.2x 8.0x 7.6x 7.4x

Min 0.0% 79% $ 102 10.9x 10.7x 11.0x $ 234 4.5x 8.5x 5.6x 5.9x 6.1x

Note: Market data as of 2/13/04. 2003E and 2004E Net Income based on First Call consensus estimates. 2003E and 2004E EBITDA based on research analyst projections.

PETRIE PARKMAN & Co.

4—25

Reference Value Analysis

Florida Properties Reserve Summary as of 12/31/021

Oil/Liquids PV10 OpEx Lifting Cost CapEx F&DC

MMBbls MM MM $ /Bbl MM $ /Bbl

Proved Reserves

Proved Developed Producing 10.7 $ 46.7 $ 108.4 $ 10.14 $ 24.0 $ 2.25

Proved Developed Non-Producing 3.8 26.9 10.7 2.81 2.7 0.70

Proved Undeveloped 1.8 14.3 3.0 1.66 4.3 2.37

Total Proved Reserves 16.3 $ 87.9 $ 122.1 $ 7.48 $ 31.0 $ 1.90

Probable Reserves 1.6 8.9 2.3 1.45 6.0 3.76

Possible Reserves 1.1 9.5 0.0 0.00 0.0 0.00

Total Reserves 19.0 $ 106.3 $ 124.4 $ 6.53 $ 37.0 $ 1.94

Proved Reserves by Volume

By Category

PUD 11%

PDP 66%

PDNP 23%

Proved Reserves by PV10

By Category

PUD 16%

PDP 53%

PDNP 31%

1 Based on Netherland, Sewell & Associates, Inc. reserve report as of 12/31/02. Petrie Parkman assumed reserve report production for 2002 was replaced during 2003.

PETRIE PARKMAN & Co.

4—26

Reference Value Analysis

Discounted Cash Flow Analysis as of 12/31/031

Florida Properties

12345678

Reference Value Ranges—Non Stepped-Up Analysis ($MM)

Category Pricing Case I Pricing Case II Pricing Case III Strip Pricing (Esc.) Strip Pricing (Flat)

Proved Reserves

Proved Developed Producing 2 $ 15.9 - $ 16.8 $ 22.7 - $ 24.5 $ 29.4 - $ 32.1 $ 29.5 - $ 31.4 $ 25.0 - $ 25.6

Proved Developed Non-Producing 3 9.8 - 11.4 11.2 - 13.0 12.7 - 14.7 11.4 - 13.2 10.2 - 11.7

Proved Undeveloped 4 4.0 - 4.8 4.8 - 5.7 5.5 - 6.5 4.8 - 5.7 4.5 - 5.3

Total Proved Reserves $ 29.7 - $ 33.0 $ 38.6 - $ 43.2 $ 47.6 - $ 53.4 $ 45.6 - $ 50.3 $ 39.8 - $ 42.6

Probable 5 0.6 - 0.8 0.6 - 1.0 0.7 - 1.1 0.7 - 1.0 0.6 - 0.9

Possible 6 0.6 - 1.0 0.7 - 1.1 0.8 - 1.2 0.7 - 1.1 0.7 - 1.0

Total Reserves $ 30.9 - $ 34.8 $ 40.0 - $ 45.2 $ 49.1 - $ 55.6 $ 47.0 - $ 52.3 $ 41.1 - $ 44.6

Hedging 7 1.5 - 1.5 0.1 - 0.1 (1.2) - (1.3) (3.7) - (3.8) (3.7) - (3.8)

G&A 8 (6.8) - (7.4) (6.8) - (7.4) (6.8) - (7.4) (6.8) - (7.4) (6.8) - (7.4)

Florida Properties Reference Value Range $ 25.7 - $ 29.0 $ 33.4 - $ 38.0 $ 41.1 - $ 47.0 $ 36.6 - $ 41.2 $ 30.6 - $ 33.4

1 In its analysis, Petrie Parkman assumed PLX replaced production in 2003.

2 Based on the NPV of after-tax cash flows using discount rates of 10.0 – 12.5%.

3 Based on the NPV of after-tax cash flows using discount rates of 12.5 – 15.0%.

4 Based on the NPV of after-tax cash flows using discount rates of 17.5 – 20.0%.

5 Based on the NPV of after-tax cash flows using discount rates of 30.0 – 40.0%.

6 Based on the NPV of after-tax cash flows using discount rates of 40.0 – 50.0%.

7 Based on the NPV of the Company’s estimated after-tax hedge position at 12/31/03 using discount rates of 10.0 – 12.5%.

8 See page 4—28.

PETRIE PARKMAN & Co.

4—27

Reference Value Analysis

Discounted Cash Flow Assumptions

Florida Properties

Petrie Parkman calculated after-tax net cash flows for the reserves using the following assumptions and procedures:

Reserves/Production Profile

Production profiles for proved reserves were based on the Netherland, Sewell & Associates, Inc. reserve report as of 12/31/02. Petrie Parkman assumed reserve report production for 2002 was replaced during 2003.

Currency

All $            figures represent United States dollars.

Product Pricing

Petrie Parkman utilizes five pricing scenarios for West Texas Intermediate (“WTI”) equivalent oil. WTI forecasts are based on current NYMEX WTI spot prices and escalators. Adjustments were made to the forecasts above to account for quality and for transportation differentials consistent with PLX’s historical realized differentials.

Operating Capital Costs

Operating and capital costs are based on the reserve report and escalated at 3%.

Income Tax Rate

U.S. combined statutory federal and state rate = 39%.

General & Administrative Expense

Petrie Parkman projected G&A expense for PLX’s Florida properties for a 10-year period based on 2004 estimates and Netherland Sewell’s projection of PDP reserves. The application of after-tax discount rates of 10.0%—12.5% to the projected after-tax G&A burden yielded a range as shown below.

General & Administrative: ($6.8) MM - ($7.4) MM

PETRIE PARKMAN & Co.

4—28

DCF Analysis Sensitivities

Approximate DCF Analysis sensitivity to various parameters, all else being equal:

Approx. Impact per PLX

Sensitivity

Share

Change of 1% in PAA organic growth rate +/- $ 1.00

Change of 1.0x in PAA acquisition multiple +/- $1.00 – 3.00

Change of 100 bps in PAA cost of equity ( $150 MM annual acq.) +/- $ 0.45

Change of 100 bps in PAA cost of debt ($150 MM annual acq.) +/- $ 1.00

Change of $100 MM per yr. in PAA acquisitions +/- $3.00 – 5.00

Change of $1.00/Bbl in oil prices (PLX E&P only) +/- $ 0.15

PETRIE PARKMAN & Co.

4—29

DCF Analysis Sensitivities

PLX Discounted Cash Flow Analysis—Sensitivities

Growth Sensitivity

Assumptions:

Discount Rate 10.0% 10.0%

Terminal EBITDA Multiple 8.0x 8.0x

Acquisition Multiple of EBITDA 7.5x 7.5x

% Debt Financing 50.0% 50.0%

PAA Average Cost of Debt 6.0% 6.0%

Equity Reference Value Range ($/Sh.)

Organic Growth Rate $

$ 16.24 -1.0% 0.0% 1.0% 2.0% 3.0%

$0 $ 7.38 $ 8.55 $ 9.43 $ 10.37 $ 11.54

$ 100 $ 10.93 $ 12.21 $ 13.23 $ 14.34 $ 15.52

Yearly Acquisitions $ 200 $ 15.07 $ 16.34 $ 17.42 $ 18.52 $ 19.69

$ 300 $ 19.58 $ 20.91 $ 21.91 $ 22.99 $ 24.14

Acquisition Sensitivity 2

Assumptions:

Discount Rate 10.0% 10.0%

Terminal EBITDA Multiple 8.0x 8.0x

Organic Growth Rate 2.0% 2.0%

Yearly Acquisitions $150 $150

% Debt Financing 50.0% 50.0%

PAA Equity Yield 6.9% 7.0%

Equity Reference Value Range ($/Sh.)

PAA Average Cost of Debt

$ 16.24 9.0% 8.0% 7.0% 6.0% 5.0%

10.0x $ 10.69 $ 11.66 $ 12.64 $ 13.59 $ 14.57

Acquisition

Multiple 9.0x $ 11.55 $ 12.55 $ 13.50 $ 14.52 $ 15.45

8.0x $ 12.68 $ 13.67 $ 14.64 $ 15.63 $ 16.56

7.0x $ 14.09 $ 15.06 $ 16.05 $ 17.06 $ 18.10

6.0x $ 16.00 $ 17.00 $ 18.02 $ 18.95 $ 20.02

Acquisition Sensitivity

Assumptions:

Discount Rate 10.0% 10.0%

Terminal EBITDA Multiple 8.0x 8.0x

Organic Growth Rate 2.0% 2.0%

% Debt Financing 50.0% 50.0%

PAA Average Cost of Debt 6.0% 6.0%

Equity Reference Value Range ($/Sh.)

Acquisition Multiple

$ 16.24 10.0x 9.0x 8.0x 7.0x 6.0x

$0 $ 10.37 $ 10.37 $ 10.37 $ 10.37 $ 10.37

$100 $ 12.56 $ 13.15 $ 13.89 $ 14.84 $ 16.12

Yearly Acquisitions $200 $ 14.79 $ 16.03 $ 17.61 $ 19.56 $ 22.29

$300 $ 17.24 $ 19.18 $ 21.58 $ 24.60 $ 28.78

Cost of Capital Sensitivity

Assumptions:

Discount Rate 10.0% 10.0%

Terminal EBITDA Multiple 8.0x 8.0x

Organic Growth Rate 2.0% 2.0%

Yearly Acquisitions $150 $150

Acquisition Multiple of EBITDA 7.5x 7.5x

% Debt Financing 50.0% 50.0%

Equity Reference Value Range ($/Sh.)

PAA Average Cost of Debt

$ 16.24 9.0% 8.0% 7.0% 6.0% 5.0%

8.9% $ 12.40 $ 13.40 $ 14.38 $ 15.38 $ 16.32

Equity

7.9% $ 12.85 $ 13.86 $ 14.84 $ 15.84 $ 16.77

Yield 6.9% $ 13.35 $ 14.32 $ 15.30 $ 16.30 $ 17.33

$ 13.82 $ 14.78 $ 15.76 $ 16.76 $ 17.79

PAA 5.9%

4.9% $ 14.30 $ 15.25 $ 16.23 $ 17.23 $ 18.26

PETRIE PARKMAN & Co.

4—30

DCF Analysis Sensitivities

PLX Discounted Cash Flow Analysis—Sensitivities

Growth Sensitivity

Assumptions:

Discount Rate 10.0% 10.0%

Terminal EBITDA Multiple 8.0x 8.0x

Acquisition Multiple of EBITDA 8.5x 7.5x

% Debt Financing 50.0% 50.0%

PAA Average Cost of Debt 7.0% 6.0%

Equity Reference Value Range ($/Sh.)

Organic Growth Rate

$ 16.30 -1.0% 0.0% 1.0% 2.0% 3.0%

$0 $ 6.95 $ 8.07 $ 8.94 $ 9.95 $ 11.07

$ 100 $ 9.54 $ 10.63 $ 11.58 $ 12.66 $ 13.83

Yearly Acquisitions $ 200 $ 12.14 $ 13.46 $ 14.50 $ 15.61 $ 16.82

$ 300 $ 15.30 $ 16.68 $ 17.68 $ 18.82 $ 19.95

Acquisition Sensitivity 2

Assumptions:

Discount Rate 10.0% 10

Terminal EBITDA Multiple 8.0x

Organic Growth Rate 2.0% 2

Yearly Acquisitions $150 $

% Debt Financing 50.0% 50

PAA Equity Yield 6.9% 6

Equity Reference Value Range ($/Sh.)

PAA Average Cost of Debt $

$ 16.30 9.0% 8.0% 7.0% 6.0% 5.0%

10.0x $ 10.69 $ 11.66 $ 12.64 $ 13.59 $ 14.57

Acquisition

Multiple 9.0x $ 11.55 $ 12.55 $ 13.50 $ 14.52 $ 15.45

8.0x $ 12.68 $ 13.67 $ 14.64 $ 15.63 $ 16.56

7.0x $ 14.09 $ 15.06 $ 16.05 $ 17.06 $ 18.10

6.0x $ 16.00 $ 17.00 $ 18.02 $ 18.95 $ 20.02

Acquisition Sensitivity

Assumptions:

Discount Rate 10.0%

Terminal EBITDA Multiple 8.0x

Organic Growth Rate 2.0%

% Debt Financing 50.0%

PAA Average Cost of Debt 7.0%

Equity Reference Value Range ($/Sh.)

Acquisition Multiple

$ 16.30 10.0x 9.0x 8.0x 7.0x 6.0x

$0 $ 9.95 $ 9.95 $ 9.95 $ 9.95 $ 9.95

$100 $ 11.74 $ 12.32 $ 13.05 $ 13.99 $ 15.33

Yearly Acquisitions $200 $ 13.66 $ 14.91 $ 16.46 $ 18.47 $ 21.07

$300 $ 15.69 $ 17.65 $ 20.04 $ 23.19 $ 27.22

Cost of Capital Sensitivity

Assumptions:

Discount Rate 10.0% 10.0%

Terminal EBITDA Multiple 8.0x 8.0x

Organic Growth Rate 2.0% 2.0%

Yearly Acquisitions $150 $150

Acquisition Muliple of EBITDA 8.5x 7.5x

% Debt Financing 50.0% 50.0%

Equity Reference Value Range ($/Sh.)

PAA Average Cost of Debt

$ 16.30 9.0% 8.0% 7.0% 6.0% 5.0%

8.9% $ 11.13 $ 12.12 $ 13.11 $ 14.14 $ 15.08

Equity

7.9% $ 11.61 $ 12.60 $ 13.61 $ 14.59 $ 15.52

Yield 6.9% $ 12.09 $ 13.05 $ 14.06 $ 15.04 $ 15.97

$ 12.54 $ 13.51 $ 14.52 $ 15.50 $ 16.43

PAA 5.9%

4.9% $ 13.04 $ 14.03 $ 14.99 $ 15.97 $ 16.89

PETRIE PARKMAN & Co.

4—31

Standard Definitions

Standard Definitions1

** Income Statement **

Revenues Operating revenues from major lines of business

Operating Income Revenues - operating expenses + exploration expense (to normalize for

accounting

methods)

Non-Operating Items All recurring but non-operating items (e.g. interest income)

Net Income Reported net income (adjusted to exclude effect of all non-recurring items)

- preferred dividends—minority interest

Interest Expense Interest charges and capitalized lease obligations net of capitalized interest and not net of interest income where possible

Adjusted Net Income Earnings to common + tax-effected impairments – tax-effected gains (losses) – tax-

effected other non-recurring revenue (expenses)

Discretionary Cash Flow Earnings to common + DD&A Expense – income from discounted operations + deferred taxes – capitalized interest +impairments + exploration expense – gains (losses) – other non-recurring items

EBITDA Earnings before interest, taxes, DD&A

Operating Cash Flow EBITDA + G&A Expense

1 All items should be adjusted to exclude effects of non-recurring items.

PETRIE PARKMAN & Co.

Standard Definitions

Standard Definitions1

(cont’d)

** Balance Sheet **

Market Value Market value of common equity

Long-Term Debt All long-term debt, capitalized lease obligations, and production payments at book value

Working Capital Current assets – current liabilities

Preferred Stock All preferred stocks at (in order of preference subject to availability) (i) Market value, (ii)

liquidation value, or (iii) book value

Enterprise Value Market Value + Long-Term Debt + Minority Interest + Preferred Stock – Working Capital

Proved Reserves All reserves including proportionate share of affiliates and equity investments

SEC Value Standardized measure of future net cash flows

1 All items should be adjusted to exclude effects of non-recurring items.

PETRIE PARKMAN & Co.

EX-99.D3

EXHIBIT(d)(3)

STOCKHOLDERS’ AGREEMENT

for

VULCAN ENERGY CORPORATION

TABLE OF CONTENTS

	ARTICLE I DEFINED TERMS
Section 1.1	Definitions.	1
Section 1.2	Rules of Construction.	8
ARTICLE II REPRESENTATIONS AND WARRANTIES
Section 2.1	Representations and Warranties of the Company.	9
Section 2.2	Representations and Warranties of Stockholders.	10
ARTICLE III MANAGEMENT OF THE COMPANY; ACTIVITIES OF THE STOCKHOLDERS
Section 3.1	Board of Directors.	10
Section 3.2	Board Approval Matters.	13
Section 3.3	Certificate of Incorporation and Bylaws.	14
Section 3.4	Approval of Employment Agreements.	15
Section 3.5	Termination of Employment Agreement without Cause.	15
Section 3.6	Amendments to Bylaws.	15
ARTICLE IV TRANSFER RESTRICTIONS; TRANSFER OF STOCK
Section 4.1	Transfer of Common Stock.	15
Section 4.2	Prohibited Transferees.	16
Section 4.3	Transfers to Affiliates; Deemed Transfers.	16
Section 4.4	Limitation on Partial Transfers.	16
Section 4.5	Right of First Offer.	17
Section 4.6	Right of First Refusal.	18
Section 4.7	Tag Along Rights.	19
Section 4.8	Drag Along Rights.	20
Section 4.9	Violations.	22
Section 4.10	Sale Transaction; Cooperation.	22
Section 4.11	Legends.	23
Section 4.12	Transferees to be Bound.	24
Section 4.13	Call Rights.	24
Section 4.14	Effect of Sale.	28
ARTICLE V COVENANTS OF THE COMPANY
Section 5.1	Financial Statements and Other Information.	29

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Section 5.2	Records.	29
Section 5.3	Fiscal Year.	29
Section 5.4	Debt Support Fee.	30
Section 5.5	Preemptive Rights.	30
ARTICLE VI ADDITIONAL AGREEMENTS
Section 6.1	Confidentiality.	30
Section 6.2	Credit Agreement Defaults.	32
Section 6.3	Tax Cooperation.	32
Section 6.4	Dividends.	33
Section 6.5	Acquisitions of MLPGP Interests.	33
ARTICLE VII MISCELLANEOUS
Section 7.1	Termination of Agreement.	33
Section 7.2	Notices.	34
Section 7.3	Waivers.	35
Section 7.4	Amendment.	35
Section 7.5	Applicable Law; Jurisdiction.	36
Section 7.6	Assignment.	36
Section 7.7	Binding Effect; Benefits.	36
Section 7.8	Counterparts.	36
Section 7.9	Invalidity.	36
Section 7.10	Entire Agreement and Construction.	36
Section 7.11	Expenses.	37
Section 7.12	After-Acquired Shares of Common Stock.	37
Section 7.13	Joinder of Spouses.	37
Section 7.14	Future Actions.	37
Section 7.15	Enforcement of this Agreement.	37
Section 7.16	Interpretation.	37
Section 7.17	No Partnership.	37

- ii -

STOCKHOLDERS’ AGREEMENT

THIS STOCKHOLDERS’ AGREEMENT, is entered into and effective as of             , 2004 (the “Effective Date”), by and among Vulcan Energy Corporation, a Delaware corporation (the “Company”), Paul G. Allen, an individual (“Allen”), James C. Flores, an individual (“Flores”) and John T. Raymond, an individual (“Raymond”)(each of Flores and Raymond is sometimes referred to herein as a “Management Stockholder” and collectively, as the “Management Stockholders”). Allen, each Management Stockholder and each other person that may become a party to this Agreement as contemplated hereby are hereinafter referred to individually as a “Stockholder” and collectively as the “Stockholders”.

W I T N E S S E T H:

WHEREAS, the Company’s authorized capital stock consists of [            ] shares of Class A Common Stock, par value [$0.01] per share (the “Class A Common Stock”), [            ] shares of Class B Common Stock, par value [$0.01] per share (the “Class B Common Stock”), and [            ] shares of Class C Common Stock, par value [$0.01] per share (the “Class C Common Stock”, and together with the Class A Common Stock and the Class B Common Stock, the “Common Stock”), with each share of Common Stock having the rights and preferences set forth in the Company’s Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws; and

WHEREAS, contemporaneously with the execution and delivery of this Agreement, each of the Management Stockholders is acquiring certain of such shares of Common Stock pursuant to the Subscription Agreement (as defined herein); and

WHEREAS, the Company and each of the Stockholders have agreed, inter alia, to make certain provisions for the management of the Company and its Subsidiaries and to restrict the transfer of the Common Stock held by the Stockholders.

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, and intending to be legally bound hereby, the parties hereto covenant and agree as follows:

ARTICLE I

DEFINED TERMS

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

“Affiliate” means, with respect to a specified Person, any other Person, directly or indirectly controlling, controlled by or under direct or indirect common

control with such specified Person. For purposes of this definition, “control” (including, with correlative meanings, “controlling”, “controlled by”, and “under common control with”) means the power to direct or cause the direction of the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise.

“Allen” has the meaning set forth in the introduction hereto.

“Allen Designee” has the meaning set forth in Section 3.1(a).

“Allen Ownership Percentage” means, as of a particular time, the amount, expressed as a percentage, obtained by dividing (i) the aggregate number of shares of Common Stock owned by Allen and/or each of his Affiliates at such time, by (ii) the total number of shares of Common Stock outstanding at such time. For the avoidance of doubt, shares of Common Stock issuable in respect of any options, warrants or other securities which are exercisable or exchangeable for, or convertible into, Common Stock shall not be deemed to be owned by Allen or any of his Affiliates for purposes of clause (i) above, and shall not be deemed to be outstanding for purposes of clause (ii) above.

“Alpha Notice” has the meaning set forth in Section 4.5.

“Alpha Option Period” has the meaning set forth in Section 4.5.

“Alpha Price” has the meaning set forth in Section 4.5.

“Appraiser” has the meaning set forth in Section 4.13(e)(ii).

“Beta Notice” has the meaning set forth in Section 4.6.

“Beta Option Period” has the meaning set forth in Section 4.6.

“Beta Price” has the meaning set forth in Section 4.6.

“Beta Sale Reference Date” has the meaning set forth in Section 4.6.

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

“Bylaws” means the Company’s Amended and Restated Bylaws as in effect on the date hereof, as such Bylaws may be hereafter amended in accordance with the provisions thereof and the provisions of Section 3.3 hereof.

“Call Closing” has the meaning set forth in Section 4.13(g).

“Call Closing Date” has the meaning set forth in Section 4.13(g).

- 2 -

“Call Event” means, with respect to a particular Management Stockholder, the occurrence of any of the following events: (i) a Management Stockholder Insolvency Event with respect to such Management Stockholder; (ii) the termination of the Exclusivity Agreement with respect to such Management Stockholder (other than pursuant to Section 3.1(e) or Section 3.2(c) thereof), (iii) a material breach of any representation, warranty, covenant or agreement of such Management Stockholder set forth in the Subscription Agreement or this Agreement, which breach is not cured within 30 days after notice thereof, (iv) with respect to Raymond, the termination of the Raymond Employment Agreement by the Company for Cause (as defined therein) or by Raymond other than for Good Reason (as defined therein), or (v) with respect to Flores, the termination of the Flores Employment Agreement by the Company for Cause (as defined therein) or by Flores other than for Good Reason (as defined therein).

“Call Option Notice” has the meaning set forth in Section 4.13(a).

“Call Right” has the meaning set forth in Section 4.13(a).

“Call Shares” has the meaning set forth in Section 4.13(a).

“Certificate of Incorporation” means the Company’s Amended and Restated Certificate of Incorporation as in effect on the date hereof, and as such Certificate of Incorporation may be hereafter amended in accordance with applicable law and the terms of this Agreement.

“Class A Common Stock” has the meaning set forth in the recitals hereto.

“Class B Common Stock” has the meaning set forth in the recitals hereto.

“Class C Common Stock” has the meaning set forth in the recitals hereto.

“Closing” has the meaning set forth in the Subscription Agreement.

“Closing Date” has the meaning set forth in the Subscription Agreement.

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

“Common Stock” has the meaning set forth in the recitals hereto.

“Company” has the meaning set forth in the introduction hereto.

“Confidential Information” has the meaning set forth in Section 6.1.

“Derivative Securities” means, with respect to a particular issuer, securities of such issuer which are exercisable or exchangeable for, or convertible into, equity securities of such issuer, excluding (i) any securities which are exercisable or exchangeable for, or convertible into, equity securities of such issuer where such

- 3 -

securities are issued or delivered to any lender to the issuer or any of its Affiliates or to any purchaser of any debt security issued by the issuer or any of its Affiliates, in each case in connection with the incurrence of, or any amendment or waiver in connection with, the indebtedness to such lender or represented by such debt security, as the case may be, and (ii) convertible or exchangeable notes and other convertible, exchangeable or derivative debt instruments.

“Drag Along Purchaser” has the meaning set forth in Section 4.8(a).

“Drag Percentage” has the meaning set forth in Section 4.8(a).

“Effective Date” has the meaning set forth in the introduction hereto.

“Employee Agreement” means the Flores Employment Agreement or the Raymond Employment Agreement, as the case may be.

“Excluded Issuance” means the issuance of:

(a) equity or Derivative Securities to officers, employees, managers or directors of, or consultants to, the issuer or its Affiliates, on the Closing Date in accordance with the Subscription Agreement or pursuant to the Exclusivity Agreement, or the issuance to such Persons of any equity securities pursuant to the terms of any such Derivative Securities;

(b) equity issuable upon conversion of (i) any securities which are exercisable or exchangeable for, or convertible into, equity securities of the Company where such securities are issued or delivered to any lender to the Company or any of its Subsidiaries or to any purchaser of any debt security issued by the Company or any of its Subsidiaries, in each case in connection with the incurrence of, or any amendment or waiver in connection with, the indebtedness to such lender or represented by such debt security, as the case may be, or (ii) any Derivative Securities, convertible or exchangeable notes and other convertible, exchangeable or derivative debt instrument that are issued in compliance with this Agreement;

(c) securities issued as a dividend or upon any split or other subdivision, recapitalization or combination of equity;

(d) any equity securities or Derivative Securities issued to the Company or any of its Subsidiaries;

(e) any equity securities or Derivative Securities issued to any third party not Affiliated with Allen, including securities issued as consideration in connection with the merger or consolidation of another entity into or with the Company or a Subsidiaries of the Company, or the sale of all or substantially all of the assets of another entity to the Company or a Subsidiary of the Company;

- 4 -

(f) any equity securities or Derivative Securities issued in connection with any public offering of any equity securities or Derivative Securities of the Company;

(g) the provisions of either Employment Agreement related to management incentive payments as a result of Allen receiving a certain rate of return on his investment in the Company; and

(h) any shares of Common Stock issued pursuant to Section 10.6 of the Subscription Agreement.

“Exclusivity Agreement” means the Exclusivity Agreement to be entered into at the Closing among Allen and each of the Management Stockholders, substantially in the form of Exhibit A hereto, as such agreement may be amended or modified from time to time in accordance with its terms.

“Fair Market Value” has the meaning set forth in Section 4.13(e).

“Flores” has the meaning set forth in the introduction hereto.

“Flores Designee” has the meaning set forth in Section 3.1(a).

“Flores Employment Agreement” means the Employment Agreement between the Company and Flores in the form entered into at the Closing, as such agreement may be amended or modified from time to time in accordance with its terms.

“Flores Ownership Percentage” means, as of a particular time, the amount, expressed as a percentage, obtained by dividing (i) the aggregate number of shares of Common Stock owned by Flores and/or each of his Affiliates at such time, by (ii) the total number of shares of Common Stock outstanding at such time. For the avoidance of doubt, shares of Common Stock issuable in respect of any options, warrants or other securities which are exercisable or exchangeable for, or convertible into, Common Stock shall not be deemed to be owned by Flores or any of his Affiliates for purposes of clause (i) above, and shall not be deemed to be outstanding for purposes of clause (ii) above.

“Management Designee” has the meaning set forth in Section 3.1(a).

“Management Stockholder” and “Management Stockholders” have the meanings set forth in the introduction hereto.

“Management Stockholder Insolvency Event” means, with respect to a particular Management Stockholder, any of the following: (a) (i) the commencement by such Management Stockholder of a voluntary case under applicable law relating to bankruptcy, insolvency or reorganization, (ii) the consent by such Management Stockholder to the entry of an order for relief against himself in an involuntary case under applicable law relating to bankruptcy, insolvency or reorganization, (iii) the consent by such Management Stockholder to the appointment of a receiver, trustee, assignee,

- 5 -

liquidator or similar Person (“Custodian”) over himself for substantially all of his property under applicable law relating to bankruptcy, insolvency or reorganization or (iv) the making by such Management Stockholder of a general assignment for the benefit of creditors; or (b) the entry by a court of competent jurisdiction of an order or decree under applicable law relating to bankruptcy, insolvency or reorganization that remains unstayed for 90 calendar days and that (i) is for relief against such Management Stockholder in an involuntary case, (ii) appoints a Custodian over such Management Stockholder for all or substantially all of his property, or (iii) orders the liquidation of substantially all of such Management Stockholder’s assets.

“MLP” means Plains All American Pipeline, L.P., a Delaware limited partnership.

“MLPGP” means Plains All American GP LLC, a Delaware limited liability company.

“MLPGP LLC Agreement” means the Amended and Restated Limited Liability Company Agreement of MLPGP, dated as of June 8, 2001, as such agreement may be amended or modified from time to time in accordance with its terms.

“Participation Rights Notice Period” has the meaning set forth in Section 5.5(b).

“Participation Rights Offer” has the meaning set forth in Section 5.5(a).

“Permitted Receiving Persons” has the meaning set forth in Section 6.1(d).

“Person” means an individual, partnership, limited partnership, limited liability partnership, limited liability company, foreign limited liability company, trust, estate, corporation, custodian, trustee, executor, administrator, nominee or any other entity.

“Pledge” has the meaning set forth in Section 4.1(a).

“Prohibited Transferee” means any Person that during the fiscal year immediately preceding the time of determination had crude oil midstream operating income less maintenance and capital expenditures of at least $40,000,000.

“Proposed Purchaser” has the meaning set forth in Section 4.7(a).

“Proposed Sale” has the meaning set forth in Section 4.7(a).

“Purchase Money Note” has the meaning set forth in Section 4.13(f).

“Purchase Money Note Offset Amount” has the meaning set forth in Section 4.13(f).

- 6 -

“Purchase Price” has the meaning set forth in Section 4.13(d).

“Purchasing Stockholder” has the meaning set forth in Section 4.13(b).

“Qualifying Alpha Offer” has the meaning set forth in Section 4.5.

“Raymond” has the meaning set forth in the introduction hereto.

“Raymond Designee” has the meaning set forth in Section 3.1(a).

“Raymond Employment Agreement” means the Employment Agreement between the Company and Raymond in the form entered into at the Closing, as such agreement may be amended or modified from time to time in accordance with its terms.

“Raymond Ownership Percentage” means, as of a particular time, the amount, expressed as a percentage, obtained by dividing (i) the aggregate number of shares of Common Stock owned by Raymond and/or each of his Affiliates at such time, by (ii) the total number of shares of Common Stock outstanding at such time. For the avoidance of doubt, shares of Common Stock issuable in respect of any options, warrants or other securities which are exercisable or exchangeable for, or convertible into, Common Stock shall not be deemed to be owned by Raymond or any of his Affiliates for purposes of clause (i) above, and shall not be deemed to be outstanding for purposes of clause (ii) above.

“Sable” means Sable Investments, L.P., a Delaware limited partnership.

“Sale” or “Sell” has the meaning set forth in Section 4.1(a).

“Sale Notice” has the meaning set forth in Section 4.7(a).

“Sale Request” has the meaning set forth in Section 4.7(a).

“Sale Transaction” means a sale of all or substantially all of the assets or equity of the Company to a non-Affiliate of Allen, which may take the form of a merger, consolidation or similar transaction involving the Company or all or substantially all of its significant Subsidiaries, a share exchange, a stock or unit purchase or any other similar transaction.

“Section 4.8 Notice” has the menaing set forth in Section 4.8(b).

“Securities Act” means the Securities Act of 1933, as amended from time to time and any successor statute thereto, and the rules and regulations promulgated thereunder, as amended from time to time.

“Selling Stockholder” has the meaning set forth in Section 4.13(a).

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“Stockholder” and “Stockholders” has the meaning set forth in the introduction hereto.

“Stockholder Pro Rata Call Shares” has the meaning set forth in Section 4.13(b).

“Subscription Agreement” means the Subscription Agreement, dated November 19, 2003, by and among the Company, Allen, Flores and Raymond, as such agreement may be amended or modified from time to time in accordance with its terms.

“Subsidiary” means, with respect to a specified Person, any Person in which, at the time of the applicable determination, such specified Person has, directly or indirectly, a 50% or greater ownership interest or any Person with respect to which such specified Person possesses (through one or more intermediaries) the power to direct or cause the direction of the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; provided, however, that in no event shall (i) MLP or any of its Subsidiaries be deemed to be a Subsidiary of the Company or (ii) the Company or any of its Subsidiaries be deemed to be a Subsidiary of Allen.

“Substitute Director” has the meaning set forth in Section 3.1(d).

“Tax Distribution Amount” means, with respect to a particular calendar quarter, the amount necessary to pay the foreign, federal, state and local income taxes on all taxable income that would be allocated to the Stockholders by the Company for such calendar quarter at the combined foreign, federal, state and local tax rate which is the highest among the Stockholders.

“Transferor” has the meaning set forth in Section 4.7.

“Withdrawing Director” has the meaning set forth in Section 3.1(d).

Section 1.2 Rules of Construction. For purposes of this Agreement:

(a) Unless the context otherwise requires; (i) words in the singular include the plural and words in the plural include the singular; (ii) words in the masculine include the feminine and words in the feminine include the masculine; (iii) a reference to any person or entity includes its successors and assigns and (iv) the words “include” or “including” shall be deemed to be followed by the phrase “without limitation”.

(b) References to Articles or Sections are, unless otherwise specified, to Articles or Sections of this Agreement. The captions in this Agreement and the Table of Contents to this Agreement are for convenience of reference only and shall not be deemed to alter or affect any provision hereof or interpretation or construction hereof.

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(c) References herein to any agreement or other instrument shall, unless the context otherwise requires (or the definition thereof otherwise specifies), be deemed references to the same as it may from time to time be changed, amended or extended.

(d) All pronouns and all variations thereof shall be deemed to refer to the masculine, feminine, or neuter, singular or plural, as the context in which they are used may require. Any reference to any statutes or laws will include all amendments, modifications, or replacements of the specific sections and provisions concerned.

ARTICLE II

REPRESENTATIONS AND WARRANTIES

Section 2.1 Representations and Warranties of the Company. The Company represents and warrants to each of the Stockholders as follows:

(a) The Company is a corporation duly organized and validly existing under the laws of the State of Delaware. The Company has the corporate power and authority to carry on its business as proposed to be conducted and is duly licensed or qualified to do business and in good standing in each jurisdiction in which its ownership or leasing of property or the conduct of its business requires such licensing or qualification. The Company has full right, power and authority to enter into this Agreement and to perform its obligations hereunder.

(b) This Agreement has been duly authorized, executed and delivered by the Company and constitutes a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except that such enforceability (i) may be limited by bankruptcy, insolvency, moratorium or other similar laws affecting or relating to the enforcement of creditors’ rights generally and (ii) is subject to general principles of equity and the discretion of the court before which any proceedings seeking injunctive relief or specific performance may be brought.

(c) Neither the execution and delivery of this Agreement, nor the consummation of the transactions contemplated hereby, nor compliance by the Company with any of the provisions hereof will (i) conflict with or result in a breach of any provision of the Certificate of Incorporation or Bylaws, (ii) constitute or result in a breach of any term, condition or provision of, or constitute a default under, or give rise to any right of termination, cancellation or acceleration with respect to, or result in the creation of any lien, charge or encumbrance upon any property or asset of the Company pursuant to any note, bond, mortgage, indenture, license, agreement or other instrument or obligation to which the Company is a party, or (iii) violate any order, writ, injunction, decree, statute, rule or regulation applicable to the Company, except (in the case of clause (ii) above) for such violations, rights, conflicts, breaches, creations or defaults which, either individually or in the aggregate, will not have a material adverse effect on the business, results of operations or financial condition of the Company and its Subsidiaries, taken as a whole.

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Section 2.2 Representations and Warranties of Stockholders. Each Stockholder, severally and not jointly, represents and warrants to Company and to the other Stockholders as follows:

(a) Such Stockholder is an individual resident or citizen of the United States or a trust as described in Section 1361(c)(2) of the Code and is an eligible S corporation shareholder as defined in Section 1361(b)(1) of the Code.

(b) This Agreement has been duly authorized, executed and delivered by such Stockholder and constitutes a valid and binding obligation of such Stockholder enforceable against such Stockholder in accordance with its terms, except that such enforceability (i) may be limited by bankruptcy, insolvency, moratorium or other similar laws affecting or relating to the enforcement of creditors’ rights generally and (ii) is subject to general principles of equity and the discretion of the court before which any proceedings seeking injunctive relief or specific performance may be brought.

(c) Neither the execution and delivery of this Agreement, nor the consummation of the transactions contemplated hereby, nor compliance by the Stockholder with any of the provisions hereof will (i) constitute or result in a breach of any term, condition or provision of, or constitute a default under, or give rise to any right of termination, cancellation or acceleration with respect to, or result in the creation of any lien, charge or encumbrance upon any property or asset of the Stockholder pursuant to any note, bond, mortgage, indenture, license, agreement or other instrument or obligation to which the Stockholder is a party, or (ii) violate any order, writ, injunction, decree, statute, rule or regulation applicable to the Stockholder.

ARTICLE III

MANAGEMENT OF THE COMPANY; ACTIVITIES OF THE STOCKHOLDERS

Section 3.1 Board of Directors.

(a) Each of the Stockholders and the Company shall take all action within their respective power (including having all of their shares of Common Stock represented in person or by proxy at all meetings of Stockholders, voting their shares of Common Stock, acting by written consent, and using all reasonable efforts to cause any director designated by such Stockholder not to take any action inconsistent with this Agreement) required to cause the Board of Directors of the Company at all times to consist of five members, subject to adjustment as provided in Section 3.1(b)(i) and (iv), as follows: (i) three designees of Allen (each an “Allen Designee”), (ii) subject to Section 3.1(b)(ii) and (iv), one designee of Flores (the “Flores Designee”), and (iii) subject to Section 3.1(b)(iii) and (iv), one designee of Raymond (the “Raymond Designee”; each of the Flores Designee and the Raymond Designee is sometimes referred to herein as a “Management Designee” and collectively, as the “Management Designees”).

(b) (i) If the right of any Management Stockholder to designate a director shall terminate under this Section 3.1(b), then the number of directors shall automatically and immediately, without any further action, be decreased by one for each such right that has terminated.

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(ii) The right of Flores to designate one director under this Section 3.1 shall terminate (x) at such time as Flores or any of his Affiliates Sells any shares of Common Stock (other than transfers of shares of Common Stock to any of Flores’s Affiliates that are permitted under Article IV or transfers of less than all of Flores’s Common Stock pursuant to Section 4.8) if, immediately after such Sale, the Flores Ownership Percentage is less than 25% of the Flores Ownership Percentage at the time of the Closing or (y) at such time as Flores or any of his Affiliates Sells any shares of Common Stock pursuant to Section 4.8 if, immediately after such Sale, the Flores Ownership Percentage is less than 10% of the Flores Ownership Percentage at the time of the Closing.

(iii) The right of Raymond to designate one director under this Section 3.1 shall terminate (x) at such time as Raymond or any of his Affiliates Sells any shares of Common Stock (other than transfers of shares of Common Stock to any of Raymond’s Affiliates that are permitted under Article IV or transfers of less than all of Raymond’s Common Stock pursuant to Section 4.8) if, immediately after such Sale, the Raymond Ownership Percentage is less than 25% of the Raymond Ownership Percentage at the time of the Closing or (y) at such time as Raymond or any of his Affiliates Sells any shares of Common Stock pursuant to Section 4.8 if, immediately after such Sale, the Raymond Ownership Percentage is less than 10% of the Raymond Ownership Percentage at the time of the Closing.

(iv) If at any time and for so long as either or both of the Management Stockholders and their Affiliates own a majority of the outstanding shares of Common Stock, Flores shall have the right to designate two Flores Designees and Raymond shall have the right to designate two Raymond Designees; provided that if either Management Stockholder and its Affiliates own no Common Stock and the other Management Stockholder and its Affiliates own a majority of the outstanding shares of the Common Stock, the Stockholders agree to take all steps necessary or advisable, including amending the Certificate of Incorporation, Bylaws and this Agreement, to allow such Management Stockholder and his Affiliates to designate a majority of the directors of the Company.

(c) Notwithstanding anything herein to the contrary, each Stockholder shall use its best efforts to ensure (including by appearing at a meeting, or executing a written consent, with respect to their shares of Common Stock) that (x) Allen shall have the sole and exclusive power to remove any Allen Designee from the Board of Directors of the Company, with or without cause, (y) Flores shall have the sole and exclusive power to remove any Flores Designee from the Board of Directors of the Company, with or without cause, and (z) Raymond shall have the sole and exclusive power to remove any Raymond Designee from the Board of Directors of the Company, with or without cause; provided, however, that at such time as any Management Stockholder is no longer entitled to designate a director pursuant to Section 3.1(b), such Management Stockholder and each other Stockholder shall use their best efforts to ensure (including by appearing at a meeting, or executing a written consent, with respect to their shares of Common Stock) that any director

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then holding office who was designated by such Management Stockholder shall automatically and immediately, without any further action, be removed from the Board of Directors of the Company, including any committees thereof.

(d) In the event that any director (a “Withdrawing Director”) designated in the manner set forth in Section 3.1(a) above is unable to serve, or once having commenced to serve, is removed or withdraws from the Board of Directors of the Company, such Withdrawing Director’s replacement (the “Substitute Director”) on the Board of Directors of the Company will be designated by the party or parties who designated the Withdrawing Director, subject to Section 3.1(b) hereof. The Company and each of the Stockholders agree to take all action within their power, including the voting of capital stock of the Company, to cause the election of such Substitute Director.

(e) In the event any Stockholder entitled to designate a director or directors pursuant to this Agreement chooses not to designate any director or directors, such directorship or directorships shall remain vacant.

(f) A majority of the Board of Directors, which majority must include at least two Allen Designees for so long as the Allen Designees constitute a majority of the Board of Directors, must be present in order for a quorum of the Board of Directors to be present for the transaction of the Company’s business.

(g) The Board of Directors of the Company shall meet not less than four times per annum.

(h) Special meetings of the Board of Directors of the Company may be called by any director or upon written notification to the Board of Directors by Stockholders holding at least 30% of the then-outstanding shares of Common Stock.

(i) Subject to the next sentence, all meetings of the Board of Directors shall be held upon at least three Business Days notice to all directors. Notice of a meeting need not be given to any director who signs a waiver of notice or a consent to holding the meeting (which waiver or consent need not specify the purpose of the meeting) or an approval of the minutes thereof, whether before or after the meeting, or who attends (by whatever permitted means) the meeting without protesting, prior to its commencement, the lack of notice to such director. All such waivers, consents and approvals shall be filed with the Company records or made a part of the minutes of the meeting. Meetings of the Board of Directors may be held at any place within or without the State of Delaware which has been designated in the notice of the meeting or at such place as may be approved by the Board of Directors. Directors may participate in a meeting through use of conference telephone, electronic video screen communication, or other communications equipment, so long as all directors participating in such meeting can hear one another. Participation in a meeting in such manner constitutes a presence in person at such meeting.

(j) The Company shall reimburse the reasonable out-of-pocket expenses incurred by each director in the performance of such director’s obligations as a director (including expenses incurred traveling to and from and attending meetings of the Board of Directors of the Company).

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Section 3.2 Board Approval Matters. Subject to the provisions of this Agreement, the business, property and affairs of the Company shall be managed and all powers of the Company shall be exercised by or under the direction of the Board of Directors. Except as otherwise expressly provided in this Agreement, the vote of a majority of the directors (at least two of whom must be Allen Designees for so long as the Allen Designees constitute a majority of the Board of Directors) shall constitute the act of the Board of Directors; provided, however, that, without the prior approval of a majority of the directors, which majority shall include at least two Allen Designees, for so long as the Allen Designees constitute a majority of the Board of Directors, and one Management Designee, if any, the Company shall not, and, where applicable, shall not permit any of its Subsidiaries to, directly or indirectly, take or permit to be taken any of the following actions:

(a) Increase or decrease the number of members of the Board of Directors of the Company;

(b) To the extent such funds are legally available for distribution, fail to declare and pay dividends in respect of any calendar quarter at least equal to the lesser of (i) the Tax Distribution Amount for such calendar quarter and (ii) the amount, if any, by which (x) the aggregate amount of cash and cash equivalents of the Company at the end of such calendar quarter, exceeds (y) the amount of cash reserves that is necessary or appropriate in the reasonable discretion of a majority of the directors (at least two of whom must be Allen Designees for so long as the Allen Designees constitute a majority of the Board of Directors) to (1) provide for the proper conduct of the business of the Company (including reserves for future capital expenditures, for debt prepayments, for anticipated future credit needs of the Company and for anticipated capital contributions to MLPGP) subsequent to such quarter or (2) comply with applicable law or any loan agreement, security agreement, mortgage, debt instrument or other agreement or obligation to which the Company is a party or by which the Company is bound or its assets or property is subject;

(c) Except agreements entered into on the Effective Date in connection with the consummation of the transactions contemplated under the Subscription Agreement, enter into any agreement or transaction involving more than $50,000 with (x) a director or any officer of the Company or any of its Subsidiaries or (y) any Stockholder(s) or any of their respective Subsidiaries or Affiliates; provided, however, that subject to compliance by the Company with Section 5.5, this Section 3.2(c) shall not apply to any issuance of securities to Allen or any of his Affiliates on terms that are fair to the Company or pursuant to Section 10.6 of the Subscription Agreement;

(d) Incur indebtedness for borrowed money (excluding intra-company borrowings or renewals or extensions of existing agreements in effect on the Closing Date), where the amount of such indebtedness incurred, together with all other indebtedness for borrowed money of the Company, exceeds 5.5 times the Company’s consolidated cash flows (as determined under the Company’s principal debt documents with s third party) for the four fiscal quarters immediately preceding such determination; provided,

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that for purposes of determining whether the aggregate amount of such indebtedness incurred exceeds 5.5 times such cash flows, the following indebtedness shall be disregarded: (1) indebtedness to the extent that the proceeds thereof are to be used to refinance or repay, concurrently with or within ten business days of incurrence, any other indebtedness, (2) indebtedness incurred for the sole purpose of making mandatory and scheduled repayments of existing indebtedness which is to be repaid within 12 months of the incurrence of such indebtedness, and (3) indebtedness incurred to pay fees and expenses associated with the raising, renewal or refinancing of any indebtedness which is the subject of this provision;

(e) Approve any Sale of any shares of Common Stock by Allen to any Prohibited Transferee prior to the third anniversary of the Closing Date pursuant to Section 4.2(b);

(f) Engage in any material business activity outside the scope of the Midstream Business (as defined in the Exclusivity Agreement), other than activities reasonably related to the Midstream Business;

(g) Approve any individual capital projects or incur any capital expenditures in any transaction or series of related transactions for an amount in excess of $5,000,000 in any calendar year, other than maintenance capital; provided, however, that, for the avoidance of doubt, the foregoing shall not be deemed to apply to any acquisition, directly or indirectly, of any Securities, including any membership interests in MLPGP or any general or limited partner interests in MLP; or

(h) Amend or propose, approve, authorize or adopt any amendment to, the Certificate of Incorporation or the Bylaws.

Section 3.3 Certificate of Incorporation and Bylaws.

(a) Attached hereto as Exhibit B is the Certificate of Incorporation as it shall be in effect on the Closing Date. The provisions of the Certificate of Incorporation are hereby approved by, and made a part of the agreement among, the parties hereto. Each of the Stockholders and the Company shall take all action within their respective power (including having all of their shares of Common Stock represented in person or by proxy at all meetings of Stockholders, voting their shares of Common Stock, acting by written consent, and using all reasonable efforts to cause any director designated by such Stockholder all necessary action) required to cause the proposal, approval and adoption of the Certificate of Incorporation immediately following the Closing.

(b) Attached hereto as Exhibit C are the Bylaws as they shall be in effect on the Closing Date. The provisions of the Bylaws are hereby approved by, and made a part of the agreement among, the parties hereto. Each of the Stockholders and the Company shall take all action within their respective power (including having all of their shares of Common Stock represented in person or by proxy at all meetings of Stockholders, voting their shares of Common Stock, acting by written consent, and using all reasonable efforts to cause any director designated by such Stockholder all necessary action) required to cause the proposal, approval and adoption of the Bylaws immediately following the Closing.

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Section 3.4 Approval of Employment Agreements. At the request of Flores or Raymond, the Stockholders shall vote in favor of (including by appearing at a meeting, or executing a written consent, with respect to their shares of Common Stock) approval of the Flores Employment Agreement or the Raymond Employment Agreement, as the case may be, in accordance with Section 280G(b)(5) of the Code and the regulations thereunder.

Section 3.5 Termination of Employment Agreement without Cause. Any determination by the Board of Directors of the Company to terminate either the Flores Employment Agreement or the Raymond Employment Agreement for any reason other than “Cause” (as defined in the Flores Employment Agreement or the Raymond Employment Agreement, as the case may be) shall require the unanimous approval of the Board of Directors; provided, however, that for purposes of this Section 3.5, a determination by the Board of Directors of the Company that “Cause” exists may be made by a majority of the directors (at least two of whom must be Allen Designees for so long as the Allen Designees constitute a majority of the Board of Directors). For the avoidance of doubt, a determination by the Board of Directors of the Company not to renew the Flores Employment Agreement or the Raymond Employment Agreement shall not constitute termination for a reason other than “Cause” for purposes of this Section 3.5.

Section 3.6 Amendments to Bylaws. Notwithstanding anything in the Certificate of Incorporation, the Bylaws or this Agreement to the contrary, each of the Stockholders acknowledges and agrees that it shall not take or cause to be taken any action to amend, restate, repeal or adopt new bylaws for the Company, unless such action is taken with the approval of a majority of the Board of Directors of the Company, which majority shall include at least two Allen Designees, for so long as the Allen Designees constitute a majority of the Board of Directors, and one Management Designee, if any. Any purported action by any Stockholder to amend, restate, repeal or adopt new bylaws for the Company that does not comply with the immediately preceding sentence shall be null and void ab initio and of no force or effect, and the Company shall not recognize or be bound by any such purported action.

ARTICLE IV

TRANSFER RESTRICTIONS; TRANSFER OF STOCK

Section 4.1 Transfer of Common Stock.

(a) Prior to January 1, 2015, so long as the Allen Ownership Percentage is greater than 20% of the Allen Ownership Percentage at the Closing, no Stockholder (other than Allen) shall, without the prior written consent of Allen, directly or indirectly give, sell, transfer, assign or otherwise in any manner dispose of any of its shares of Common Stock or any interest therein (other than a bona fide pledge thereof that is otherwise permitted under this Article IV or any transfer pursuant to such a pledge, “a Sale” or “to Sell”), or pledge, hypothecate, encumber or otherwise grant a security interest in (voluntarily or involuntarily, a “Pledge”), any shares of Common Stock, except (x) pursuant to Section 4.3, (y) as provided in Sections 4.7, 4.8, or 4.13 or (z) with the prior written consent of Allen.

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(b) Notwithstanding any other provision of this Agreement to the contrary, (i) without the prior written consent of Allen, no Stockholder (other than Allen) may transfer, and no Person may acquire, the legal or beneficial ownership of any share of Common Stock if such transfer or acquisition would cause the Company to fail to meet the definition of an S corporation as defined in Section 1361(a)(1) of the Code and (ii) Allen may not transfer, and no Person may acquire, the legal or beneficial ownership of any share of Common Stock if such transfer or acquisition would cause the Company to fail to meet the definition of an S corporation as defined in Section 1361(a)(1) of the Code; provided, however that this clause (ii) shall not apply to any Sale by Allen of more than 50% of the shares of Common Stock held by Allen immediately prior to such transaction. Without limiting the foregoing, without the prior written consent of Allen, (x) no Sale may be made if the result thereof would be that the Company would have more than the maximum permitted number of stockholders under the Code to qualify as an S corporation as in effect at the time of the purported Sale, and (y) no Stockholder may Sell the legal or beneficial ownership of any Common Stock to any Person other than (i) an individual who is a resident or citizen of the United States, (ii) a trust described in Section 1361(c)(2) of the Code, or (iii) an entity that is and remains disregarded as an entity separate from such Stockholder for Federal income tax purposes; provided, however that this sentence shall not apply to any Sale by Allen of more than 50% of the shares of Common Stock held by Allen immediately prior to such transaction.

Section 4.2 Prohibited Transferees. Notwithstanding anything in this Agreement to the contrary, no Stockholder (other than Allen) shall Sell or Pledge any shares of Common Stock to any Prohibited Transferee, except pursuant to Sections 4.7 or 4.8.

(b) Prior to the third anniversary of the Closing Date, Allen shall not Sell any shares of Common Stock to any Prohibited Transferee without the prior consent of the Board of Directors of the Company pursuant to Section 3.2(e).

Section 4.3 Transfers to Affiliates; Deemed Transfers.     Subject to Sections 4.1 and 4.2 and subject to compliance with Section 4.12, a Stockholder may transfer shares of Common Stock to a controlled Affiliate thereof. In the event any such Affiliate ceases to be an Affiliate of the transferring Stockholder due to such Stockholder’s sale, transfer or other disposition of its direct or indirect interest in such Affiliate, such transferring Stockholder shall cause such Affiliate to transfer to such Stockholder or another Affiliate of such Stockholder all Common Stock owned by such Affiliate immediately prior to the time such Affiliate would cease to be an Affiliate of such Stockholder, provided that if such transfer of Common Stock does not occur prior to such disposition of such interest in such Affiliate, such disposition shall be deemed a Sale which is subject to all of the restrictions set forth in this Article IV.

Section 4.4 Limitation on Partial Transfers. A Stockholder may not Sell a number of shares of Common Stock that is less than 5% of the outstanding shares of Common Stock unless such Stockholder and its Affiliates are Selling all of the shares of Common Stock then held by such Stockholder and its Affiliates; provided, however, that the foregoing shall not apply to a Sale pursuant to Section 4.7 or Section 4.8.

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Section 4.5 Right of First Offer. If Allen desires to Sell shares of Common Stock to any Person other than (i) to an Affiliate of Allen or (ii) with respect to up to an aggregate number of shares of Common Stock equal to 40% of the shares of Common Stock held by Allen and his Affiliates, to any employee of Vulcan Inc. or any Subsidiary thereof, Allen shall invite the Management Stockholders to make a firm offer to purchase such shares of Common Stock by promptly notifying the Management Stockholders in writing of such desire to Sell such shares (such notice, the “Alpha Notice”). The Management Stockholders shall have a period of 30 days after delivery of the Alpha Notice to provide Allen with a Qualifying Alpha Offer; provided however that if the shares of Common Stock subject to such Alpha Notice represent more than 50% of the outstanding shares of Common Stock, the Management Stockholders shall have a period of 45 days after delivery of the Alpha Notice to provide Allen with a Qualifying Alpha Offer. A “Qualifying Alpha Offer” means a bona fide firm written offer by the Management Stockholders, acting jointly, or if one Management Stockholder elects not to make an offer, by the other Management Stockholder, to purchase all (but not less than all) of the shares of Common Stock then proposed to be Sold by Allen, which offer shall (w) be solely for cash, (x) set forth the material terms and conditions of such offer and the price or method of determining such price (the “Alpha Price”), (y) by its terms be open and irrevocable within the Alpha Option Period and (z) accompanied by written firm, binding commitments from reputable financial institutions to provide financing for such offer, all to Allen’s reasonable satisfaction. Allen shall have a period of up to 60 days (the “Alpha Option Period”) after the receipt of a Qualifying Alpha Offer within which to notify the Management Stockholders in writing that he accepts the Qualifying Alpha Offer. If Allen gives such written notice within the Alpha Option Period then the Management Stockholders shall have up to an additional 120 days after Allen gives such notice to do all things necessary to consummate the transaction, including receiving consents and entering into agreements, and for the avoidance of doubt during such time the Qualifying Alpha Offer shall remain irrevocable by the Management Stockholder(s). If the Management Stockholders do not make a Qualifying Alpha Offer within the requisite 30 or 45-day period, as applicable, after delivery of the Alpha Notice, or if, having made such an offer, the Management Stockholder(s) fail to consummate such transaction within the 120-day period provided above, Allen may secure a bona fide offer for such shares of Common Stock from a third party and Sell such shares of Common Stock to such third party at any price and on any terms, provided that such Sale to the bona fide third party is consummated within 270 days after the end of such 30, 45 or 120-day period, as applicable. In addition, following delivery of a Qualifying Alpha Offer, Allen may secure a bona fide offer for such shares of Common Stock from a third party and Sell such shares of Common Stock to such third party at a price greater than the Alpha Price contained in, or is on terms which are otherwise, in Allen’s reasonable judgment, in the aggregate superior to the terms of, the Qualifying Alpha Offer, provided that such Sale to the bona fide third party is consummated within 270 days after the date on which such Qualifying Alpha Offer is delivered. To the extent Allen accepts a Qualifying Alpha Offer under this Section 4.5 and the Management Stockholder(s) making such offer fail to consummate such transaction in breach of the obligation created by the acceptance of such offer, the foregoing shall not preclude Allen from seeking from such Management Stockholder(s) money damages and

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suitable relief to which he may be entitled as a result of such Management Stockholder(s)’ breach. This Section 4.5 shall terminate when either Management Stockholder shall have lost its right to designate a director pursuant to Section 3.1.

Section 4.6 Right of First Refusal. At any time after the tenth anniversary of the Closing Date, if a Stockholder (other than Allen) receives a bona fide third party offer to acquire any or all of such Stockholder’s shares of Common Stock or any interest therein (other than a bona fide pledge), which offer such Stockholder wishes to accept, such Stockholder shall promptly notify Allen in writing of such offer (the “Beta Notice”), setting forth the name and address of the prospective purchaser, the price or method of determining such price (the “Beta Price”), and the material terms and conditions of such proposed Sale. Allen shall have a period of up to 30 days (the “Beta Option Period”) after the receipt of the Beta Notice within which to notify such Stockholder in writing that he wishes to acquire all (but not less than all) of such shares of Common Stock at a price equal to the Beta Price and upon the same terms and conditions set forth in the Beta Notice. If Allen gives such written notice within the Beta Option Period, then he shall have up to an additional 120 days after he gives such notice to do all the things necessary to consummate the transaction, including receiving consents and entering into agreements. If Allen receives such consents and enters into such agreements as are necessary to consummate the transactions, then such Stockholder shall be obligated to Sell to Allen, and Allen shall be obligated to acquire from such Stockholder, such shares of Common Stock at the price and on the terms and conditions set forth in the Beta Notice. If Allen does not give such notice to such Stockholder within such Beta Option Period or if, having given such notice, Allen shall fail to consummate such transaction with the 120-day period provided above, then, subject to Sections 4.1, 4.2 and 4.4, such Stockholder shall be free to Sell such shares of Common Stock to the party named in its notice provided that such Sale is consummated within 120 days after the Beta Sale Reference Date at a price equal to or greater than the Beta Price and upon substantially the same terms and conditions (other than the price, which may be higher than the Beta Price) as are set forth in the Beta Notice. Allen shall be entitled from time to time to assign his rights under this Section 4.6 to any of his Affiliates. The “Beta Sale Reference Date” means (i) the date on which the Beta Option Period expires or (ii) if Allen shall have given the requisite written notice during the Beta Option Period but shall have failed to consummate such transaction within the 120-day period provided above, the date on which such 120-day period shall end; provided, that if during such 120-day period Allen shall have notified such Stockholder in writing that Allen will not consummate such transaction and that Allen waives his rights under this Section 4.6 with respect to that particular Beta Notice, then the Beta Sale Reference Date shall be the date of such notice from Allen. To the extent Allen agrees to buy shares of Common Stock from a Stockholder under this Section 4.6 and fails to consummate such transaction in breach of his obligations under such agreement, the foregoing shall not preclude such Stockholder from seeking from Allen money damages and suitable relief to which he may be entitled as a result of Allen’s breach. This Section 4.6 shall terminate when Allen and his Affiliates collectively no longer own at least 50% of the outstanding shares of Common Stock.

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Section 4.7 Tag Along Rights.

(a) General. Subject to Section 4.5, if Allen or any Affiliate of Allen (as the case may be, a “Transferor”) proposes to Sell any of the shares of Common Stock owned by it to any Person other than (i) an Affiliate of Allen or (ii) with respect to up to an aggregate number of shares of Common Stock equal to 40% of the shares of Common Stock held by Allen and his Affiliates, any employee of Vulcan Inc. or any Subsidiary thereof (a “Proposed Purchaser”), then the Transferor will promptly provide each Management Stockholder written notice (a “Sale Notice”) of such proposed Sale (a “Proposed Sale”) and the material terms of the Proposed Sale as of the date of such Sale Notice, including the aggregate number of shares of Common Stock the Proposed Purchaser is willing to purchase. If within ten Business Days of the receipt of the Sale Notice, the Transferor receives a written request (a “Sale Request”) to include the shares of Common Stock held, directly or indirectly, by any Management Stockholder in the Proposed Sale, such Management Stockholder shall have the right to Sell, at the same price, on the same terms and pursuant to the same conditions as the Proposed Sale, up to such number of shares of Common Stock as shall equal the aggregate number of shares of Common Stock proposed to be Sold in such transaction by the Transferor multiplied by a fraction, the numerator of which is the aggregate number of shares of Common Stock owned by such Management Stockholder and the denominator of which is the aggregate number of shares of Common Stock owned by the Transferor and its Affiliates and all other Stockholders participating in such transaction; provided, however, that if, under the terms of the Proposed Sale, Allen has agreed to assign the right to designate all three Allen Designees to the Proposed Purchaser, such Management Stockholder shall have the right to Sell, at the same price, on the same terms and pursuant to the same conditions as the Proposed Sale, up to all of the shares of Common Stock owned by such Management Stockholder. If a Management Stockholder wishes to Sell a number of shares of Common Stock which is less than its share as determined pursuant to the preceding sentence, the maximum number of shares of Common Stock such Management Stockholder wishes to Sell must be explicitly set forth in the Sale Request. If any such Management Stockholder has not accepted the offer contained in the Sale Notice by delivering the Sale Request to the Transferor in the required time, such Management Stockholder shall be deemed to have irrevocably waived its rights under this Section 4.7(a) with respect to such Proposed Sale, and the Transferor shall thereafter be free, for a period of 180 days from the date of the Sale Notice, to transfer the shares of Common Stock specified in the Sale Notice upon the same terms and conditions set forth in the Sale Notice. Any Sale Request shall be irrevocable, and once received by the Transferor, such Management Stockholder shall be obligated to Sell to the Proposed Purchaser such Management Stockholder’s shares of Common Stock in accordance with this Section 4.7(a). In connection with the delivery of the Sale Request, a Management Stockholder shall deliver to the Transferor the certificates for the shares of Common Stock to be sold by it in connection with the Proposed Sale, duly endorsed or accompanied by written instruments of transfer, in form and substance satisfactory to Allen, free and clear of any liens. If a Management Stockholder should fail to so deliver such certificates to the Transferor, (i) the Transferor shall have the right to complete the Proposed Sale without regard to the defaulting Management Stockholder by substituting additional shares of Transferor’s Common Stock in lieu of the shares of Common Stock that the defaulting Management Stockholder would otherwise have Sold in such Proposed Sale, and such Management Stockholder shall be deemed to have revoked his Sale Request and to have irrevocably waived his rights under

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this Section 4.7(a) with respect to such Proposed Sale or (ii), if the Transferor does not exercise its right set forth in clause (i) of this sentence, the Company shall cause its books and records to show that such shares of Common Stock are bound by the provisions of this Section 4.7(a) and that such shares of Common Stock shall be transferred to the transferee identified in the Sale Notice immediately upon surrender for transfer by such holder; provided, however, that the foregoing shall not preclude the Transferor from seeking any remedy to which it may otherwise be entitled as a result of such Management Stockholder’s failure to so deliver such certificates. The Transferor shall not consummate any Proposed Sale without compliance with this Section 4.7(a), and the Company shall not recognize or give effect to any purported transfer of shares of Common Stock not made in compliance with this Section 4.7(a).

(b) Terms. Shares of Common Stock subject to a Sale Request will be included in a Proposed Sale pursuant hereto and to any agreement with the Proposed Purchaser relating thereto, on the same terms and subject to the same conditions applicable to the shares of Common Stock which the Transferor proposes to sell in the Proposed Sale. Such terms and conditions shall be determined in the sole discretion of the Transferor, and shall include (i) the Sale consideration and (ii) the provision of information, representations, warranties, covenants and requisite indemnifications; provided, however, that (x) if the terms set forth in such definitive documents differ in any material respect from the material terms set forth in the Sale Notice with respect to such Proposed Sale, then notwithstanding the delivery of a Sale Request with respect to such Proposed Sale, the Management Stockholder who delivered such Sale Request shall have the right to rescind such Sale Request by delivering written notice of such rescission to the Transferor within two Business Days of receipt of such definitive documents, and (y) any representations and warranties relating specifically to any Stockholder shall only be made by that Stockholder and any indemnification provided by the Stockholders shall be on a several, not joint, basis and shall be based on the number of shares of Common Stock being Sold by each Stockholder in the Proposed Sale (determined on a fully diluted basis calculated using the treasury method). In addition, each participating Management Stockholder shall reimburse the Transferor for its proportionate share (based on consideration received) of the out-of-pocket costs and expenses incurred by the Transferor in connection with any such Proposed Sale.

(c) Termination. This Section 4.7 shall terminate when Allen and his Affiliates collectively no longer own at least 50% of the outstanding shares of Common Stock.

Section 4.8 Drag Along Rights.

(a) General. Subject to Section 4.5, if at any time Allen and/or any of his Affiliates elects to Sell shares of Common Stock representing more than 50% of the outstanding shares of Common Stock to any third party (other than Allen or an Affiliate) (the “Drag Along Purchaser”) in a bona fide arm’s-length transaction, Allen may, at his option, require each, but not less than all, of the other holders of shares of Common Stock to Sell the Drag Percentage (as defined herein) of its shares of Common Stock in such transaction on the same terms and conditions set forth below. “Drag Percentage” means, with respect a particular Sale under this Section 4.8, an amount, expressed as a percentage,

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equal to (i) the number of shares of Common Stock being Sold by Allen and his Affiliates in such transaction divided by (ii) the aggregate number of shares of Common Stock held by Allen and his Affiliates immediately prior to consummation of such Sale; provided, however, if as a result of such proposed Sale under this Section 4.8 a Management Stockholder would lose its right to designate a director under Section 3.1, such Management Stockholder shall have the right to Sell, at the same price, on the same terms and conditions as the proposed Sale, up to all of its shares of Common Stock in excess of its Drag Percentage, provided, that in order to exercise such right such Management Stockholder shall, within 10 days of delivery of the Section 4.8 Notice, provide irrevocable written notice to Allen of such Management Stockholder’s exercise of such right specifying the number of shares it elects to sell in excess of its Drag Percentage.

(b) Written Notice. Allen shall provide written notice of such Sale to the other holders of shares of Common Stock (a “Section 4.8 Notice”) and a draft of the agreement pursuant to which such shares of Common Stock are proposed to be transferred. The Section 4.8 Notice shall state (i) the name and address of the prospective transferee(s), (ii) the material terms and conditions (including price) of the contemplated sale and (iii) the expected closing date of the transaction. Each other holder of shares of Common Stock must participate in such Sale on the terms and conditions set forth in the Section 4.8 Notice.

(c) Delivery of Shares of Common Stock. Within ten Business Days following the receipt of the Section 4.8 Notice, each other holder of shares of Common Stock shall deliver to Allen, or his representative designated in the Section 4.8 Notice, if any, shall deliver the certificates representing his shares of Common Stock duly endorsed or accompanied by written instruments of transfer, in form and substance reasonably satisfactory to Allen, free and clear of any liens, together with any other documents reasonably required to be executed in connection with such Sale. If any such holder of shares of Common Stock should fail to deliver such certificates to Allen, the Company shall cause its books and records to show that such shares of Common Stock are subject to the provisions of this Section 4.8 and that such shares of Common Stock shall be transferred to the transferee identified in the Section 4.8 Notice immediately upon surrender for transfer by such holder.

(d) Consummation of Sale. Promptly after the consummation of the Sale pursuant to this Section 4.8, Allen shall give notice thereof to the other holders of shares of Common Stock, shall direct the purchaser to remit to each such holder who has surrendered its certificates the total consideration for the shares of Common Stock of such holder and, in any event, shall furnish such other evidence of the completion and time of completion of such Sale and the terms thereof as may be reasonably requested by such holder. If within 180 days after Allen gives the Section 4.8 Notice, the Sale has not been completed, he shall, if applicable, return to each other holder of shares of Common Stock the certificates delivered for transfer pursuant hereto, together with any documents in his possession executed by such holder in connection with such proposed transaction, and Allen shall thereafter be required to re-comply with the provisions of this Section 4.8 if he wishes to require the holders of shares of Common Stock to sell such shares in any transaction subject to this

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Section 4.8; provided, however that if, having given a Section 4.8 Notice, Allen elects to cease the process of pursuing a sale under this Section 4.8, Allen may not give another Section 4.8 Notice until 12 months after the date of such initial Section 4.8 Notice; provided, further however, that the restriction in the foregoing proviso shall not apply to any Section 4.8 Notice given in respect of, or in response to, any unsolicited offer.

(e) Terms. Shares of Common Stock subject to this Section 4.8 will be included in a proposed sale pursuant hereto and be subject to any agreement with the Drag Along Purchaser relating thereto, on the same terms and subject to the same conditions applicable to the shares of Common Stock which Allen and/or his Affiliates proposes to sell in such transaction. Such terms and conditions shall be determined in the sole discretion of Allen, and shall include (i) the Sale consideration and (ii) the provision of information, representations, warranties, covenants and requisite indemnifications; provided, however, that any representations and warranties relating specifically to any Stockholder shall only be made by that Stockholder and any indemnification provided by the Stockholders shall be on a several, not joint, basis and shall be based on the number of shares of Common Stock being Sold by each Stockholder in such transaction (determined on a fully diluted basis calculated using the treasury method). In addition, each participating Stockholder shall reimburse Allen for its proportionate share (based on consideration received) of the out-of-pocket costs and expenses incurred by Allen in connection with any such transaction. In connection with any such transaction, Allen shall be entitled in his sole discretion to determine the form of, and the aggregate amount of, consideration to be paid for the shares of the Company; provided, however, that no Stockholder shall be required to accept in any such transaction any consideration other than cash or marketable securities (or any combination thereof).

Section 4.9 Violations. Any purported Sale or Pledge of any shares of Common Stock by a Stockholder which is not permitted by the foregoing provisions of this Article IV, or which is in violation of such provisions, shall be void and of no force and effect whatsoever and shall not be recognized by the Company, and no dividends of any kind whatsoever nor any distribution pursuant to liquidation or otherwise shall be paid by the Company in respect of such shares (all such dividends and distributions being deemed waived), and the voting rights of such shares of any matter whatsoever shall be suspended, during the period commencing with such party’s initial failure of compliance with this Article IV and ending either when the other party or parties shall have been given a full opportunity to exercise its rights under and in accordance with this Article IV or when the other party or parties shall agree in writing to terminate such suspension, and to permit such Sale or Pledge.

Section 4.10 Sale Transaction; Cooperation. Sale Transaction. Subject to Section 4.5 with respect to any Sale Transaction that involves the transfer of shares of Common Stock, at any time and from time to time Allen shall have the right to initiate a Sale Transaction with any Person other than an Affiliate of Allen. In connection with any Sale Transaction, Allen shall be entitled in his sole discretion to determine whether such Sale Transaction will take the form of a sale of all or substantially all of the assets or equity of the Company, a merger, consolidation or similar transaction involving the Company or any of its significant Subsidiaries, a share exchange, a stock or unit purchase or any other similar transaction, and each Stockholder hereby agrees to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate fully with Allen and the Company in doing, all things necessary, proper and advisable to consummate and make effective such Sale Transaction on terms and conditions acceptable to Allen, including (i) voting, and

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causing any of its Affiliates holding shares of Common Stock to vote, all such shares in favor of such Sale Transaction and (ii) entering into such documents as shall be reasonably required to be executed in connection with such Sale Transaction

(b) Terms. Each Stockholder’s interests subject to this Section 4.10 will participate in a proposed Sale Transaction pursuant hereto and be subject to any agreement with the counter-party relating thereto, on the same terms and subject to the same conditions applicable to Allen’s interests. Such terms and conditions shall be determined in the sole discretion of Allen, and shall include (i) the Sale consideration and (ii) the provision of information, representations, warranties, covenants and requisite indemnifications; provided, that (x) without its prior consent, no Stockholder shall be required to accept in any such transaction any consideration other than cash or marketable securities (or any combination thereof), other than any asset held by the Company or any of its Subsidiaries immediately prior to such transaction; provided, however, that if a Stockholder is offered the opportunity to accept in a transaction subject to this Section 4.10 any consideration other than cash or marketable securities (or any combination thereof), other than any asset held by the Company or any of its Subsidiaries immediately prior to such transaction, such Stockholder shall be deemed to have elected not to accept such consideration in such transaction unless such Stockholder provides Allen with irrevocable written notice of such Stockholder’s consent to receipt of such alternative consideration in such transaction within five Business Days of receipt from Allen of such offer of alternative consideration, and (y) any representations and warranties relating specifically to any Stockholder shall only be made by that Stockholder and any indemnification provided by the Stockholders shall be several, not joint, and shall be based on the number of shares of Common Stock being Sold by each Stockholder in the Sale Transaction (determined on a fully diluted basis calculated using the treasury method), or in the case of a liquidation or dissolution of the Company (or other similar transaction), on the proceeds distributed to such Stockholder in such transaction in respect of such Stockholder’s Common Stock and any options, warrants or other rights to acquire Common Stock held by such Stockholder. In addition, each participating Stockholder shall reimburse Allen for its proportionate share (based on consideration received) of the out-of-pocket costs and expenses incurred by the Allen in connection with any such Sale Transaction.

(c) Termination. This Section 4.10 shall terminate when Allen and his Affiliates collectively no longer own at least 50% of the outstanding shares of Common Stock.

Section 4.11 Legends.

(a) Each certificate for Common Stock shall contain a legend substantially in the form of the following:

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS OF, AND RESTRICTIONS ON TRANSFER SET FORTH IN, A STOCKHOLDERS’ AGREEMENT ENTERED INTO BY AND AMONG VULCAN ENERGY CORPORATION (THE “COMPANY”)

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AND CERTAIN OTHER PERSONS NAMED THEREIN, DATED AS OF [            ], 2004, COPIES OF WHICH ARE ON FILE WITH THE SECRETARY OF THE COMPANY, AND SUCH SHARES ARE HELD AND MAY NOT BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED, HYPOTHECATED, ENCUMBERED, OTHERWISE GRANTED AS SECURITY, OR OTHERWISE DISPOSED OF EXCEPT IN ACCORDANCE THEREWITH. SUCH STOCKHOLDERS’ AGREEMENT CONTAINS, AMONG OTHER THINGS, A “RIGHT OF FIRST REFUSAL” RESTRICTION WITH RESPECT TO SUCH SHARES.

(b) In addition to the legend required under Section 4.11(a), each Stockholder agrees that unless and until the shares of Common Stock have been registered under the Securities Act, or a transferring Stockholder delivers an opinion of counsel reasonably satisfactory to the Company that such registration is not required, or shares of Common Stock may be sold pursuant to Rule 144 of the Securities Act, each certificate representing shares of Common Stock also shall bear a legend in substantially the following form:

THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED, TRANSFERRED OR OTHERWISE DISPOSED OF UNTIL THE HOLDER HEREOF PROVIDES EVIDENCE REASONABLY SATISFACTORY TO THE COMPANY (WHICH, IN THE DISCRETION OF THE COMPANY, MAY INCLUDE AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY) THAT SUCH OFFER, SALE, PLEDGE, TRANSFER OR OTHER DISPOSITION WILL NOT VIOLATE APPLICABLE FEDERAL OR STATE SECURITIES LAWS.

Section 4.12 Transferees to be Bound. If any Stockholder Sells its shares of Common Stock, the transferee shall agree in writing with the remaining Stockholder(s) to be bound by the terms of this Agreement prior to such Sale by executing and delivering a joinder agreement substantially in the form attached hereto as Exhibit D, and from and after such Sale, such transferee shall be deemed to be a “Stockholder” for all purposes hereunder, but such transferee shall not be deemed a Management Stockholder or “Allen or his Affiliate” for any purpose hereunder.

Section 4.13 Call Rights.

(a) Within the later of (i) 90 days following the occurrence of a Call Event with respect to a Management Stockholder, and (ii) 30 days following the final determination, pursuant to Section 4.13(e), of Fair Market Value with respect to the shares of Common Stock held by such Management Stockholder, Allen shall have the right and option to purchase (a “Call Right”) all and not less than all of the shares of Common Stock owned

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by such Management Stockholder and each Affiliate of such Management Stockholder (or his personal representative, as the case may be) (collectively, the “Selling Stockholder”, and all of such Selling Stockholder’s shares of Common Stock, the “Call Shares”) in the manner, for the price and on the terms and conditions contained in this Section 4.13; provided, however, that if the other Management Stockholder elects to purchase the Stockholder Pro Rata Call Shares from such Selling Stockholder pursuant to Section 4.13(b), then Allen’s Call Right shall be with respect to a number of Call Shares equal to the aggregate number of Call Shares minus the aggregate number of Stockholder Pro Rata Call Shares purchased by the Purchasing Stockholder. Allen shall exercise such option by giving written notice of such exercise (the “Call Option Notice”) to the Selling Stockholder and the other Management Stockholder.

(b) Following the delivery of the Call Option Notice, the non-selling Management Stockholder (or his personal representative, as the case may be) (the “Purchasing Stockholder”) shall have a Call Right (exercisable within 10 days of receipt of the Call Option Notice by giving written notice to such Selling Stockholder and Allen) to purchase, in the manner, for the price and on the terms and conditions contained in this Section 4.13, such number of Call Shares equal to, but not less than, (i) the aggregate number of shares of Common Stock being purchased under this Section 4.13 at the time of such purchase transaction, multiplied by (ii) a fraction, (A) the numerator of which is the aggregate number of shares of Common Stock owned by such Purchasing Stockholder at the time of such repurchase transaction and (B) the denominator of which is the aggregate number of shares Common Stock owned by Allen and his Affiliates and the Purchasing Stockholder (or each of their respective personal representatives, as the case may be) at the time of such repurchase transaction (such number of shares of Common Stock, the “Stockholder Pro Rata Call Shares”).

(c) If Allen exercises his Call Right, then he shall purchase a number of shares of Common Stock equal to the number of Call Shares minus, in the event the Purchasing Stockholder has exercised its Call Right, the Stockholder Pro Rata Call Shares, and if the Purchasing Stockholder shall have exercised its Call Right, he shall purchase all of Stockholder Pro Rata Call Shares.

(d) The purchase price (“Purchase Price”) of any shares of Common Stock pursuant to the exercise of a Call Right shall be, subject to adjustment as provided in Section 4.13(f), the Fair Market Value of such shares.

(e) For purposes of this Section 4.13, the “Fair Market Value” of a share of Common Stock subject to a Call Right means the fair market value in U.S. dollars of a share of Common Stock as of the date of the Call Event giving rise to the determination of “Fair Market Value” which would reasonably be expected to be realized in an open market sale on arm’s length terms to a Person who is not an Affiliate of the seller or the buyer, having regard to all relevant factors, but without regard to (x) the availability or lack of availability of a market for such shares of Common Stock or (y) any minority discount that would otherwise be applicable to such shares of Common Stock, such “Fair Market Value” to be determined as follows:

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(i) During the ten-day period following the date on which a Call Event occurs, upon the request of Allen, the Selling Stockholder (or his personal representative) and Allen shall each submit to the other such party’s respective proposal as to the Fair Market Value. If the higher proposal is not more than 10% higher than the lower proposal, then the Fair Market Value shall be equal to the average of such proposals.

(ii) In the event that one of the proposals contemplated under clause (i) above is more than 10% higher than the other proposal, then within ten Business Days after the submission of such proposals, Allen and the Selling Stockholder shall jointly select and retain a managing director in an independent nationally recognized investment bank (the “Appraiser”). In the event that such parties fail to jointly select the Appraiser within such time period, then at the request of Allen or the Selling Stockholder the American Arbitration Association shall provide them with a list of at least five Appraiser candidates and each of Allen and the Selling Stockholder shall be allowed to strike a number of names from the list and rank the remaining Appraiser candidates in order of acceptance. The highest ranking Appraiser candidate who remains on the list shall serve as the Appraiser. The Appraiser shall be requested to make its determination within a period of 30 days after the deadline for submissions to be made by Allen and the Selling Stockholder pursuant to Section 4.13(e)(iii), or as soon as practicable thereafter.

(iii) Within five Business Days of the appointment of the Appraiser, each of Allen and the Selling Stockholder shall submit to the Appraiser (A) its proposed determination of the Fair Market Value provided to the other party pursuant to Section 4.13(e)(i), (B) a list of factors that it believes to be relevant in the determination of the Fair Market Value, and (C) the reasons for that proposed value. In addition, each of Allen and the Selling Stockholder shall at the same time deliver to the other a copy of any submission or information supplied by Allen and the Selling Stockholder to the Appraiser.

(iv) The Appraiser shall then make its own determination (having requested such further information from Allen, the Selling Stockholder and/or the Company as it shall require) of the Fair Market Value.

(v) The Appraiser shall certify to each of Allen, the Selling Stockholder and the Company (A) that, having considered the respective submissions of Allen and the Selling Stockholder, it has made its own determination of the Fair Market Value according to the principles of this Agreement and (B) the proposed value of which of Allen and the Selling Stockholder it determines to be closer to the Fair Market Value. The value proposed by Allen or the Selling Stockholder so certified by the Appraiser pursuant to clause (B) above shall thereupon be deemed to be the Fair Market Value.

(vi) The fees and expenses of the Appraiser shall be paid equally by the Selling Stockholder and Allen, and, if applicable, the Purchasing Stockholder shall reimburse Allen for the Purchasing Stockholder’s proportionate

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share of such fees and expenses paid by Allen. The Appraiser shall act as an expert and not as an arbitrator and its determination shall be final and binding upon the Selling Stockholder, Allen and, if applicable, the Purchasing Stockholder in the absence of manifest error. The Appraiser shall have no liability to any of the Selling Stockholder, Allen, the Company or, if applicable, the Purchasing Stockholder in respect of its determination.

(f) The Purchase Price with respect to any shares of Common Stock purchased by Allen and, if applicable, the Purchasing Stockholder pursuant to his respective Call Right shall be paid by wire transfer of immediately available funds to an account designated by the Selling Stockholder (or, in the event that the Selling Stockholder shall fail to timely designate an account to receive such wire transfer, to an escrow account established pursuant to Section 4.13(h)) promptly upon delivery of the certificates representing the Selling Stockholder’s shares of Common Stock and such other documents reasonably required for the Closing under Section 4.13(g). Notwithstanding anything in this Agreement to the contrary, in the event a Management Stockholder is indebted to the Company under a Promissory Note evidencing a portion of the subscription price or option exercise price of his shares of Common Stock (a “Purchase Money Note”), the aggregate principal bAllence, and all accrued interest, outstanding under said Purchase Money Note as of the Call Closing Date (the sum of such aggregate principal plus such accrued interest, the “Purchase Money Note Offset Amount”) shall be offset against the Purchase Price payable by Allen, and at the Call Closing Allen shall pay to the Company the Purchase Money Note Offset Amount by wire transfer of immediately available funds to an account designated by the Company. The Selling Stockholder shall receive the Purchase Price net of (i) the Purchase Money Note Offset Amount and (ii) any amount required to be withheld by law.

(g) Any purchase of shares of Common Stock pursuant to this Section 4.13 shall be consummated (the “Call Closing”) at the Company’s principal office at 10:00 a.m., prevailing business time, on the date (the “Call Closing Date”) which is the later of (i) the 90th day after the date of occurrence of the event giving rise to the Call Right and (ii) the 45^th day after Allen exercises his Call Right; provided, however, that if any regulatory approval or waiting period is required in connection with any such purchase, then such 45-day period shall be extended by the number of days necessary to satisfy such regulatory requirement, but in no event shall such period be extended by more than 60 days. If such date is not a Business Day, the Call Closing shall occur at the same time and place on, and the Call Closing Date shall be, the next succeeding Business Day. At the Call Closing, the Selling Stockholder shall deliver the certificates representing his shares of Common Stock duly endorsed, or accompanied by written instruments of transfer, in form and substance reasonably satisfactory to Allen, free and clear of any liens, and shall furnish such other evidence, including applicable inheritance and estate tax waivers and releases, as may reasonably be necessary to effect the transfers of such shares.

(h) In the event Allen and, if applicable, a Purchasing Stockholder, exercises their respective Call Right pursuant to this Section 4.13 and in the event a Selling Stockholder fails to designate an account to receive a wire transfer or fails to deliver such shares, in proper form for transfer, on the Call Closing Date, Allen and/or the Purchasing Stockholder may elect to deposit the cash representing the Purchase Price (minus any escrow

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fees) with an escrow agent. From and after the deposit of such adjusted Purchase Price, such shares shall be deemed for all purposes (including the right to vote, receive payment of dividends and exercise rights under this Agreement) to have been transferred to the purchaser(s) thereof, the Company shall issue new certificates representing such shares to the purchaser(s) thereof, and the certificates registered in the name of such Selling Stockholder shall be deemed to have been canceled and to represent solely a right to receive payment of the Purchase Price (minus any escrow fees), without interest, from the escrow account. If the proceeds of sale have not been claimed by such Selling Stockholder (by delivery of the share certificates, in proper form for transfer) prior to the third anniversary of the Call Closing Date, the escrow deposits, and all interest earned thereon, shall be returned to the respective depositors, and such Selling Stockholder shall look solely to the purchaser(s) for payment of the Purchase Price. The escrow agent shall not be liable for any action or inaction taken by him in good faith.

(i) In the event the Purchasing Stockholder exercises his Call Right under this Section 4.13 and should fail to deliver his portion of the Purchase Price and/or any other documents reasonably required to be delivered to consummate such repurchase transaction, Allen shall have the right to purchase all of the Call Shares, including the Stockholder Pro Rata Call Shares, and the Purchasing Stockholder shall be deemed to have revoked his notice provided under Section 4.13(b) and to have irrevocably waived his rights under this Section 4.13 with respect to such repurchase transaction; provided, however, that the foregoing shall not preclude Allen from seeking money damages and equitable relief to which he may be entitled as a result of the Purchasing Stockholder’s failure to participate in the Call Closing.

(j) Upon the delivery of the Call Option Notice, the Selling Stockholder’s respective rights under Sections 3.1 and 5.5 shall terminate; provided, however, that if the Call Closing shall not have occurred on or before the applicable Call Closing Date (other than due to a failure of the Selling Stockholder to comply with its obligations under this Section 4.13), then such Selling Stockholder’s respective rights under Sections 3.1 and 5.5 shall be reinstated.

(k) Termination. This Section 4.13 shall terminate when Allen and his Affiliates collectively no longer own at least 50% of the outstanding shares of Common Stock.

Section 4.14 Effect of Sale. Any Stockholder who Sells all of his shares of Common Stock to one or more un-Affiliated third parties shall cease to be a Stockholder and shall cease to have any rights under this Agreement; provided, however, that the foregoing shall not limit or modify the obligations of such Stockholder under this Agreement arising prior to or in connection with such transaction or the obligations of such Stockholder under Sections 6.1 and 6.3 hereof.

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ARTICLE V

COVENANTS OF THE COMPANY

Section 5.1 Financial Statements and Other Information. Subject to Section 6.1, the Company shall deliver to each Stockholder, or its transferee, as long as it holds any shares of Common Stock, the following:

(a) As soon as available but in any event not later than 60 days after the end of each of the quarterly accounting periods (other than the fourth fiscal quarter of the Company in each fiscal year which is governed by Section 5.1(b) below), the unaudited consolidated bAllence sheet of the Company and its Subsidiaries, if any, as of the end of each such period, the related unaudited consolidated statements of income and retained earnings of the Company and its Subsidiaries, if any, for such quarterly period and for the period from the beginning of such fiscal year to the end of such quarterly period, and the related unaudited statements of cash flows of the Company and its Subsidiaries, if any, for the period from the beginning of such fiscal year to the end of such quarterly period. All such financial statements shall be prepared in accordance with generally accepted accounting principles (except that such financial statements need not contain footnotes) applied on a consistent basis.

(b) As soon as available, but in any event no later than 90 days after the end of each fiscal year of the Company, a copy of the audited consolidated bAllence sheets of the Company and its Subsidiaries, if any, as of the end of such fiscal year and the related consolidated statements of income, retained earnings and cash flows of the Company and its Subsidiaries stating in comparative form the figures as of the end of and for the previous fiscal year certified by a firm of independent certified public accountants of recognized national standing selected by the Company and approved by the Board of Directors in accordance with Section 3.2. All such financial statements shall be prepared in accordance with generally accepted accounting principles applied on a consistent basis.

(c) As soon as available but in any event not later than 45 days after the end of each month, beginning after the first month after the Effective Date, on a monthly basis, (i) an unaudited consolidated statement of income and explanation of income and expenses of the Company and its Subsidiaries, if any, for such month, (ii) an unaudited consolidated bAllence sheet of the Company and its Subsidiaries, if any, as of the end of such month and (iii) an unaudited consolidated statement of funds from operations of the Company and its Subsidiaries, if any, as of the end of such month.

(d) With reasonable promptness, such other information and data with respect to the Company or any of its Subsidiaries as from time to time may be reasonably requested by any Stockholder.

Section 5.2 Records. The Company shall, and shall cause each of its Subsidiaries to, maintain reasonably complete and accurate records and accounts of all income and expenditures, working capital, investments, acquisitions and disposition of properties, financial arrangements and all other Company activities. Such records and accounts shall be maintained in accordance with generally accepted accounting principles.

Section 5.3 Fiscal Year. The Company’s fiscal year shall commence on January 1 and end on December 31 of each year.

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Section 5.4 Debt Support Fee. The Company shall pay to Allen, on a quarterly basis an amount equal to 150 basis points per year, compounded annually, in respect of the outstanding principal amount of any debt guaranteed by Allen in connection with the transactions contemplated by the Subscription Agreement. Such amount shall be paid in cash to the extent permitted under the Company’s credit agreements. To the extent such amounts are not paid, they will accrue interest at a rate equal to the appropriate Applicable Federal Rate, compounded annually.

Section 5.5 Preemptive Rights.

(a) Not less than 30 days prior to the issuance by the Company of (x) debt securities to Allen or any of his Affiliates or (y) equity securities or Derivative Securities (other than an Excluded Issuance), the Company shall offer to each Management Stockholder the opportunity to purchase up to such Management Stockholder’s pro-rata share of the securities to be issued at the same price, on the same terms and pursuant to the same conditions as the Company issues such securities, by delivering to each Management Stockholder a notice identifying the securities to be issued and setting forth the price, terms and conditions of such issuance (the “Participation Rights Offer”). For purposes of this Section 5.5(a), a Management Stockholder’s pro-rata share of the securities to be issued shall be determined based on the number of shares of Common Stock it holds (determined on a fully diluted basis calculated using the treasury method).

(b) A Management Stockholder shall have up to a period of 20 days after the receipt of such notice (the “Participation Rights Notice Period”) within which to notify the Company in writing that it wishes to accept the Participation Rights Offer. If a Management Stockholder wishes to purchase less than its pro-rata share of the securities to be issued, such notice shall so state and shall expressly state the maximum number of such securities that such Management Stockholder is willing to purchase. If a Management Stockholder gives such written notice within the Participation Rights Notice Period, it shall be bound to purchase such securities on such terms and subject to such conditions, and it shall do all things necessary to consummate the transaction, including executing and delivering the same documentation that is executed and delivered by the other purchasers of such securities, at the same time as the other purchasers of such securities. If a Management Stockholder does not give notice of acceptance of the Participation Rights Offer within the Participation Rights Notice Period, it shall be deemed to have irrevocably rejected the Participation Rights Offer with respect to such issuance.

ARTICLE VI

ADDITIONAL AGREEMENTS

Section 6.1 Confidentiality. Each of the Stockholders and the Company acknowledges that it, its Affiliates and its and its Affiliates’ employees, agents, advisors or representatives (collectively, “representatives”) possess and may hereafter obtain, confidential business, commercial, technical, financial and operational information from the other parties to this Agreement, their respective Affiliates and their respective businesses and which relates to the past, ongoing or future operations of the Company (collectively, such

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information, whether obtained in written form, visually (such as by inspection) or orally, is hereinafter referred to as “Confidential Information”). For purposes of this Section 6.1, the “Confidential Information of a Party” shall include the Confidential Information of such Party’s Affiliates. With respect to Confidential Information, each of the Company and each Stockholder covenants to the others as follows:

(a) Each party agrees to exercise the same degree of care as it uses in protecting its own Confidential Information from disclosure (but not less than reasonable care) to make no disclosure of any Confidential Information received from any other party, and further agrees to make no use of any Confidential Information received from any other party except, in each case, in connection with the execution and delivery of this Agreement, the Exclusivity Agreement, the agreements and transactions contemplated hereby and thereby and any future agreements, arrangements and transactions involving the operations of the Company, including, for the avoidance of doubt, in the case of Allen and his representatives, any discussions or activities with respect to any potential Sale Transaction. Notwithstanding the foregoing, the parties (and each representative of the parties) may disclose to any and all persons, without limitation of any kind, the tax treatment and any facts that may be relevant to the tax structure of the transaction, provided, however, that no party (and no employee, representative, or other agent thereof) shall disclose any other information that is not relevant to understanding the tax treatment and tax structure of the transaction (including the identity of any party and any information that could lead another to determine the identity of any party), or any other information to the extent that such disclosure could result in a violation of any federal or state securities law.

(b) The obligations of non-disclosure and restricted use contained in this Section 6.1 shall not apply to any of the disclosing party’s Confidential Information that:

(i) was available to the public prior to the date such Confidential Information was disclosed to the receiving party;

(ii) becomes available to the public through no fault of the receiving party subsequent to the date such Confidential Information was disclosed to the receiving party;

(iii) was in the possession of the receiving party prior to the date such Confidential Information was disclosed to the receiving party, and was not obtained by the receiving party from a third party having an obligation of confidentiality to the disclosing party regarding such Confidential Information;

(iv) is hereafter rightfully obtained by the receiving party from a third party not under an obligation of confidentiality to the disclosing party regarding such Confidential Information; or

(v) is independently developed by employees of the receiving party without using the Confidential Information of the disclosing party.

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(c) It shall not be a breach of the obligation of non-disclosure contained in this Section 6.1 if a receiving party discloses any Confidential Information as required by law or judicial proceeding; provided, however, that such disclosure shall be excused only to the extent such disclosure is required by law or such proceeding and only if the receiving party provides prior written notice to the disclosing party sufficient to allow the disclosing party an opportunity to oppose or attempt to limit the required disclosure, and only if the receiving party itself uses reasonable efforts to ensure that the confidentiality of the Confidential Information is protected by court or administrative order.

(d) Each party shall have the right to disclose to its Affiliates and representatives (collectively, its “Permitted Receiving Persons”) all Confidential Information received under this Agreement; however each receiving party warrants that its Permitted Receiving Persons will comply with all of the obligations set out in this Section 6.1, and further agrees to be responsible for all harm caused by any non-compliance by any Permitted Receiving Person of the receiving party with any of the obligations set out in this Section 6.1, to the same extent the receiving party would have been responsible under applicable law for its own breach of the same obligations.

(e) Each party agrees that it will use reasonable efforts to inform all of its Permitted Receiving Persons to whom Confidential Information of any other party is disclosed, of the existence of this Agreement and of the confidential nature of such Confidential Information.

Section 6.2 Credit Agreement Defaults. Each party shall use its reasonable efforts to cause the Company to promptly cure any default under any loan agreement or other debt instrument, if the result of such default would be to restrict the ability of the Company to pay dividends under the terms of such loan agreement or debt instrument.

Section 6.3 Tax Cooperation.

(a) Each Stockholder hereby consents to the election of the Company to be treated as an S corporation under Section 1362(a) of the Code and agree to execute any appropriate election, as necessary, under Subchapter S of the Code providing for the Company to be an S corporation. The Management Stockholders shall not take any action, make any election, take any position or file any form inconsistent with or which would prohibit the Company from being an S corporation or which would terminate the S corporation status of the Company, without the prior written consent of Allen.

(b) If the Company’s status as an S corporation is terminated inadvertently, or if the Company’s S election is found to have been ineffective, and the Company wishes to obtain a waiver or ruling under Section 1362(f) of the Code, each Stockholder agrees to cooperate and to sign any documents and to make any adjustments required pursuant to Section 1362(f)(4) of the Code and approved by the Company’s Board of Directors. A Stockholder’s obligation to take such actions shall continue after the Stockholder has ceased to own stock in the Company and after this Agreement has terminated.

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Section 6.4 Dividends. Each Stockholder hereby agrees that to the extent such funds are legally available for distribution, it will use its reasonable efforts to cause the Company to pay dividends in respect of any calendar quarter at least equal to the amount, if any, by which (i) the aggregate amount of cash and cash equivalents of the Company at the end of such calendar quarter, exceeds (ii) the amount of cash reserves that is necessary or appropriate in the reasonable discretion of a majority of the directors (at least two of whom must be Allen Designees for so long as the Allen Designees constitute a majority of the Board of Directors) to (A) provide for the proper conduct of the business of the Company (including reserves for future capital expenditures, for debt prepayments, for potential acquisitions, for anticipated future credit needs of the Company and for anticipated capital contributions to MLPGP) subsequent to such quarter or (B) comply with applicable law or any loan agreement, security agreement, mortgage, debt instrument or other agreement or obligation to which the Company is a party or by which the Company is bound or its assets or property is subject; provided, that no Stockholder shall have any such obligation with respect to any period if the Board of Directors shall have determined not to declare and pay such dividend for such period pursuant to Section 3.2(b).

Section 6.5 Acquisitions of MLPGP Interests. No Stockholder shall acquire any membership interest in MLPGP unless such Stockholder shall first have presented the opportunity to acquire such membership interest to the Company and the Board of Directors shall have determined not to pursue such opportunity; provided, however, that (a) in the case of Allen, such determination by the Board of Directors shall have received the concurrence of at least one Management Designee, if any, (b) the foregoing shall not prohibit Sable from acquiring any additional membership interest in MLPGP pursuant to Section 9.8 of the MLPGP LLC Agreement, and (c) the foregoing shall not apply to the acquisition of any equity security, or any security which is exercisable or exchangeable for, or convertible into, any equity security, that is listed for quotation or subject to trading on any securities exchange or market.

ARTICLE VII

MISCELLANEOUS

Section 7.1 Termination of Agreement. This Agreement shall terminate only (a) with the mutual consent of the Stockholders, (b) upon the dissolution or liquidation of the Company, (c) upon the consummation of a firm commitment underwritten offering of Common Stock pursuant to a registration statement under the Securities Act, (d) upon the consummation of any merger or consolidation to which the Company is a party, or (e) upon the consummation of a Sale Transaction (except, in the case of (d) or (e) any merger or consolidation immediately following which the Stockholders hold a majority of the capital stock entitled to vote generally in the election of directors of the surviving or resulting entity or any Person controlling such surviving or resulting entity); provided, that for purposes of this Section 7.1, if the Sale Transaction consists of a sale of all or substantially all of the Company’s assets, then such Sale Transaction shall not be deemed consummated prior to the distribution of the net proceeds of such sale which are available and intended for distribution to the Stockholders. Except for Sections 6.1 and 6.3 and this Article VII, this Agreement shall terminate as to any Stockholder at such time as such Stockholder no longer holds any Common Stock or Derivative Securities with respect thereto.

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Section 7.2 Notices. All notices, consents, requests, demands and other communications which are required or may be given pursuant to the terms of this Agreement shall be in writing and shall be deemed duly given or delivered (i) when received if delivered by hand, (ii) the Business Day after their deposit with a recognized overnight commercial courier (receipt requested), or (iii) upon receipt if sent by telecopier (with receipt confirmed), provided that with respect to clause (iii) a copy is either promptly thereafter mailed in the United States by first-class postage pre-paid mail or sent by a recognized overnight commercial courier (receipt requested), to the party as follows:

If to the Company:	Vulcan Energy Corporation
	505 Fifth Ave S Suite 900
	Seattle, WA 98104
	Fax: 206-342-3000
	Attention: David N. Capobianco
Copies (which shall not constitute notice) to:
	Skadden, Arps, Slate,
	Meagher & Flom LLP
	1600 Smith
	Suite 4400
	Houston, Texas 77002
	Fax: (713) 655-5200
	Attention: Frank Ed Bayouth II
	Nicholas Saggese
	and
	each Stockholder
If to Allen:	Paul Allen, c/o
	Vulcan Energy Corporation
	505 Fifth Ave S Suite 900
	Seattle, WA 98104
	Fax: 206-342-3000
	Attention: David N. Capobianco
Copies (which shall not constitute notice) to:
	Skadden, Arps, Slate,
	Meagher & Flom LLP
	1600 Smith
	Suite 4400
	Houston, Texas 77002
	Fax: (713) 655-5200
	Attention: Frank Ed Bayouth II
	Nicholas Saggese

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If to Flores:	c/o Plains Exploration and Production
	700 Milam, Suite 3100
	Houston, Texas 77002
	Fax: (832) 239-6210
	Attention: James C. Flores
Copies (which shall
not constitute notice) to:	Akin Gump Strauss Hauer & Feld LLP
	711 Louisiana St.
	Suite 1900 South Tower
	Houston, Texas 77002
	Fax: 713-236-0822
	Attention: Michael Dillard
If to Raymond:	c/o Plains Exploration and Production
	700 Milam, Suite 3100
	Houston, Texas 77002
	Fax: (832) 239-6210
	Attention: John T. Raymond
Copies (which shall
not constitute notice) to:	Akin Gump Strauss Hauer & Feld LLP
	711 Louisiana St.
	Suite 1900 South Tower
	Houston, Texas 77002
	Fax: 713-236-0822
	Attention: Michael Dillard

or to such other address and/or telecopy number as any party (or the acquiror of such party’s shares of Common Stock) shall have designated by 15 days’ notice in writing to the other parties.

Section 7.3 Waivers. The parties hereto may by written instrument (i) extend the time for the performance of any of the obligations or other acts of the other parties hereto, and (ii) waive compliance or performance by any other party with or of any of the covenants or agreements made to it by any other party contained in this Agreement. The delay or failure on the part of any party hereto to insist, in any one instance or more, upon strict performance of any of the terms or conditions of this Agreement, or to exercise any right or privilege herein conferred shall not be construed as a waiver of any such terms conditions, rights or privileges but the same shall continue and remain in full force and effect. All rights and remedies are cumulative.

Section 7.4 Amendment. This Agreement shall be modified, supplemented or amended only by a written instrument executed by all of the Stockholders.

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Section 7.5 Applicable Law; Jurisdiction. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without giving effect to any of the conflict of law rules thereof. Except as provided in Section 4.13(e), the Stockholders agree that the courts of Delaware (either State or Federal) are to have exclusive jurisdiction to settle any dispute arising in connection with the creation, validity, effect, interpretation or performance of, or the legal relationships established by this Agreement or otherwise arising in connection with this Agreement, and by execution of this Agreement, each Stockholder hereby irrevocably submits to the jurisdiction of such courts and further irrevocably consents to the service of process outside of the territorial jurisdiction of such courts by mailing copies thereof by registered United States mail, postage prepaid, to its address specified herein.

Section 7.6 Assignment. Except as expressly contemplated hereby, this Agreement may not be assigned by any party to it without the prior written consent of the other parties; provided, however, that subject to Section 4.7(a) without the prior written consent of the other parties hereto Allen shall be entitled to assign his right to designate one or more of the Allen Designees to any transferee of any shares of Common Stock then held by Allen or any of his Affiliates.

Section 7.7 Binding Effect; Benefits. This Agreement shall inure to the benefit of, and be binding upon, the parties to it and their respective successors, permitted assigns and other permitted transferees. Nothing contained in this Agreement, express or implied, is intended to confer upon any person or entity other than the parties to it and their respective successors, permitted assigns and other permitted transferees, any rights or remedies under or by reason of this Agreement.

Section 7.8 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.

Section 7.9 Invalidity. If any provision of this Agreement is held invalid or unenforceable, such invalidity or unenforceability shall not affect in any way the validity or enforceability of any other provision of this Agreement. In the event any provision of this Agreement is held invalid or unenforceable, the parties shall attempt to agree on a valid or enforceable provision which shall be a reasonable substitute for such invalid or unenforceable provision in light of the tenor of this Agreement and, on so agreeing, shall incorporate such substitute provision in this Agreement.

Section 7.10 Entire Agreement and Construction. This Agreement, together with the Subscription Agreement, the Exclusivity Agreement and any exhibits, annexes and other documents contemplated hereby and thereby, contains the entire agreement between the parties hereto with respect to the subject matter hereof and all prior understandings and agreements shall merge herein. There are no additional terms, whether consistent or inconsistent, oral or written, which are intended to be part of the parties’ understandings which have not been incorporated into this Agreement, the Subscription Agreement, the Exclusivity Agreement and any exhibits, annexes and other agreements and documents contemplated hereby or thereby.

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Section 7.11 Expenses. Except as otherwise expressly provided herein, each party shall bear its own fees, costs and expenses in connection with the transactions contemplated herein.

Section 7.12 After-Acquired Shares of Common Stock. All of the provisions of this Agreement shall apply to, and the term “Common Stock” means and includes (a) all of the shares of Common Stock now owned or which may be transferred hereafter to, or owned by, a Stockholder, (b) all shares of Common Stock issued to a Stockholder and (c) all shares of Common Stock (i) received by a Stockholder as a dividend on or other payment made to holders of shares of Common Stock, or (ii) issued in connection with a split of shares of Common Stock or a reorganization, recapitalization, consolidation or merger.

Section 7.13 Joinder of Spouses. The spouses of certain Stockholders have joined in the execution of this Agreement to evidence their agreement and consent to be bound by the terms and conditions hereof as to their interest, whether as community property or otherwise, if any, in the shares of Common Stock owned by their respective spouses.

Section 7.14 Future Actions. The Company and each Stockholder shall execute and deliver all such future instruments and take such other and further action as may be reasonably necessary or appropriate to carry out the provisions of this Agreement and the intention of the parties expressed herein.

Section 7.15 Enforcement of this Agreement. The parties hereto agree that irreparable damage would occur if this Agreement were not performed in accordance with its specific terms or was otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions thereof in any court of the United States or any state having jurisdiction, this being in addition to any other remedy to which they are entitled at law or in equity.

Section 7.16 Interpretation. If any claim is made by any party relating to any conflict, omission or ambiguity in this Agreement, no presumption or burden of proof or persuasion shall be implied by virtue of the fact that this Agreement was prepared by or at the request of a particular party or its counsel.

Section 7.17 No Partnership. Nothing in this Agreement shall be construed to create an association, trust, joint venture or partnership between any of the parties or to impose a trust or partnership obligation or liability upon any party. No party shall have any right, power or authority to enter into any agreement or undertaking for, or to act on behalf of, or to act as or be an agent or representative of, or to otherwise bind, any other party.

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

COMPANY:	VULCAN ENERGY CORPORATION
	By
		Name:
		Title:
STOCKHOLDERS:
	Paul G. Allen
	James C. Flores
	John T. Raymond
SPOUSE OF MANAGEMENT
STOCKHOLDERS:
	Cherie H. Flores

SCHEDULE I

Name	Number of Shares
Paul G. Allen	[	]
James C. Flores	[	]
John T. Raymond	[	]
TOTAL	[	]

S-1

EX-99.D4

EXHIBIT(d)(4)

EXCLUSIVITY AGREEMENT

AMONG

PAUL G. ALLEN

JAMES C. FLORES

AND

JOHN T. RAYMOND

Dated as of                  , 200[3]

TABLE OF CONTENTS

ARTICLE I DEFINITIONS		1
1.1	Acquisition Company	1
1.2	Affiliate	1
1.3	Agreement	2
1.4	Allen	2
1.5	Applicable Performance Criteria	2
1.6	Company	2
1.7	Confidential Information	2
1.8	Controlled Affiliate	2
1.9	Custodian	2
1.10	Employment Agreement	2
1.11	Flores	2
1.12	Flores Employment Agreement	2
1.13	Hydrocarbons	2
1.14	Incentive Arrangements	3
1.15	Management Stockholder or Management Stockholders	3
1.16	Midstream Asset	3
1.17	Midstream Oil Assets	3
1.18	Midstream Business	3
1.19	Midstream Investment	4
1.20	Midstream Oil Business	4
1.21	Midstream Oil Investment	4
1.22	Midstream Oil Opportunity	4
1.23	Midstream Opportunity	4
1.24	Minimum Participation Equity Amount	4
1.25	MLP	4
1.26	MLPGP	4
1.27	NonAffiliate Purchaser	4
1.28	Notifying Party	4
1.29	Oil Assets Purchaser	4

1.30	Offer	5
1.31	Opportunity Notice	5
1.32	Participation Terms	5
1.33	Party or Parties	5
1.34	Permitted Receiving Persons	5
1.35	Person	5
1.36	Pursue	5
1.37	Raymond	5
1.38	Raymond Employment Agreement	5
1.39	Restricted Business	5
1.40	Rolling Period	5
1.41	Second Offer	5
1.42	Securities	5
1.43	Significant Midstream Business	6
1.44	Stockholders’ Agreement	6
1.45	Structured Investment	6
1.46	VIM Representative	6
ARTICLE II COVENANTS		6
2.1	Midstream Opportunities.	6
2.2	Exceptions.	7
2.3	Management Stockholders’ Participation Right.	8
2.4	Cooperation.	10
2.5	Remedies.	10
2.6	Restricted Business Procedures.	11
ARTICLE III TERMINATION		15
3.1	Complete Termination.	15
3.2	Termination with respect to a Management Stockholder.	16
3.3	Effect of Termination.	17
ARTICLE IV REPRESENTATIONS AND WARRANTIES		18
4.1	Due Organization.	18
4.2	Due Authorization; Enforceability.	18
4.3	No Conflicts.	18

ARTICLE V MISCELLANEOUS		18
5.1	Notices.	18
5.2	Waivers.	21
5.3	Amendments.	21
5.4	Applicable Law; Jurisdiction.	21
5.5	Assignment.	21
5.6	Binding Effect; Benefits.	21
5.7	Counterparts.	22
5.8	Invalidity.	22
5.9	Entire Agreement and Construction.	22
5.10	Expenses.	22
5.11	Interpretation.	22
5.12	Rules of Construction.	22
5.13	No Partnership.	23
5.14	Electronic Signatures.	23

EXCLUSIVITY AGREEMENT

This Exclusivity Agreement (this “Agreement”) is entered into as of the      day of             , 200[    ], by and among Paul G. Allen, an individual (“Allen”), James C. Flores, an individual (“Flores”), and John T. Raymond, an individual (“Raymond”). Each of Flores and Raymond is sometimes referred to herein as a “Management Stockholder” and collectively, as the “Management Stockholders”, and each of Allen and each Management Stockholder is hereinafter referred to individually as a “Party” and collectively as the “Parties.”

WHEREAS, contemporaneously with the execution and delivery hereof, Allen, Flores, Raymond and Vulcan Energy Corporation, a Delaware corporation (the “Company”), are entering into the Stockholders’ Agreement for the Company (as such agreement may be amended by the parties thereto from time to time, the “Stockholders’ Agreement”); and

WHEREAS, as a condition to the willingness of each such party to enter into the Stockholders’ Agreement, the Parties have agreed to enter into and abide by the terms of this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and intending to be legally bound hereby, the Parties agree as follows:

ARTICLE I

DEFINITIONS

When used in this Agreement, the following terms shall have the meanings set forth below (all terms used in this Agreement that are not defined in this Article I shall have the meanings set forth elsewhere in this Agreement or, if not otherwise defined elsewhere in this Agreement, the meanings set forth in the Stockholders’ Agreement):

1.1 Acquisition Company shall have the meaning set forth in Section 2.3 (a).

1.2 Affiliate means, with respect to a specified Person, any Person directly or indirectly controlling, controlled by or under direct or indirect common control with such other Person; provided, however, that for purposes of Article II, (i) neither the Company nor any of its Subsidiaries shall be deemed to be an Affiliate of any Party or any of his Affiliates and (ii) none of MLPGP, MLP or any of its Subsidiaries shall be deemed to be an Affiliate of any Party or the Company or any of its Subsidiaries; provided, further, however, that Sable Investments, L.P. and its Subsidiaries shall be deemed an Affiliate of each Management Stockholder for so long as Flores is a party to this Agreement. For purposes of this definition, “control” (including, with correlative meanings, “controlling”, “controlled by”, and “under common control with”) means the power to direct or cause the direction of the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise.

1

1.3 Agreement means this Exclusivity Agreement, as originally executed and as amended from time to time.

1.4 Allen shall have the meaning set forth in the introduction hereto.

1.5 Applicable Performance Criteria will be deemed to have been satisfied for any Rolling Period so long as the compounded annual growth rate of the pro forma aggregate distributions to the Company for such Rolling Period, directly and indirectly from MLP, equal the London Interbank Offered Rate plus 4% (but not to exceed 6%), assuming for purposes of making such determination, that the Company’s interest in MLP during such Rolling Period is equal to the Company’s interest in MLP on the date hereof (subject to appropriate adjustment in the event of any adjustments to the “Minimum Quarterly Distribution” or “Target Distribution” levels under Section 6.6 of the MLP’s limited partnership agreement). The growth rate and hence Applicable Performance Criteria will be calculated for each Rolling Period at the end of each calendar quarter beginning with quarter ending Dec. 31, 2004 using the Rolling Period ended December 31, 2004 (but, if the Company has transferred any interest in MLP, assuming the Company’s interest is as assumed above) as the base measurement period.

1.6 Company shall have the meaning set forth in the recitals hereto.

1.7 Confidential Information has the meaning set forth in Section 2.6(d)(i).

1.8 Controlled Affiliate means, with respect to a particular Party, any Affiliate of such Party in which, at the time of the applicable determination, such Party has, directly or indirectly, a 50% or greater ownership interest and with respect to which such Party possesses (through one or more intermediaries), the power to direct or cause the direction of the management and policies of such Affiliate, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise.

1.9 Custodian shall have the meaning set forth in Section 3.3(b).

1.10 Employment Agreement means the Raymond Employment Agreement or the Raymond Employment Agreement as the case may be.

1.11 Flores shall have the meaning set forth in the introduction hereto.

1.12 Flores Employment Agreement means the Employment Agreement, dated as of the date hereof, between the Company and Flores, as such agreement may be amended or modified from time to time in accordance with its terms.

1.13 Hydrocarbons means crude oil, natural gas, casinghead gas, condensate, sulphur, natural gas liquids, plant products, liquefied petroleum gas and other liquid or gaseous hydrocarbons produced in association therewith, including coalbed methane and gas and CO₂.

2

1.14 Incentive Arrangements shall have the meaning set forth in Section 2.3(c).

1.15 Management Stockholder or Management Stockholders shall have the meaning set forth in the introduction hereto.

1.16 Midstream Asset means any asset (or any interest in any asset) that is used, or is to be used, primarily in the conduct of a Midstream Business; provided, however, that where any such assets are transferred as part of the sale to the purchaser thereof of a business, division or facility, in any such case which is structured as an asset sale, such assets shall not constitute Midstream Assets if the fair market value from such assets is less than 50% of the aggregate fair market value of all of the assets transferred to such purchaser in such transaction.

1.17 Midstream Business means the gathering, transportation, terminalling, storage, and marketing in North America of Hydrocarbons and all operations directly related thereto, including (a) the acquisition, construction, installation, maintenance or remediation and operation of pipelines, gathering lines, compressors, facilities, storage facilities and equipment, and (b) the gathering of Hydrocarbons from fields, interstate and intrastate transportation by pipeline, trucks or barges, tank storage of Hydrocarbons, transferring Hydrocarbons from pipelines and storage tanks to trucks, barges or other pipelines, acquisitions of Hydrocarbons at the well or bulk purchase at pipeline and terminal facilities and subsequent resale thereof.

1.18 Midstream Investment means (a) the acquisition (whether by purchase, merger, consolidation or otherwise, and whether for cash, property, services, securities or otherwise) of capital stock, bonds, notes, debentures, partnership or other ownership interests or other securities, including any options or warrants, of any Person with a Significant Midstream Business or any agreement to make any such acquisition; (b) the making of any deposit with, or advance, loan or other extension of credit to, any Person with a Significant Midstream Business (including the purchase of property from another Person subject to an understanding or agreement, contingent or otherwise, to resell such property to such other Person) or any commitment to make any such advance, loan or extension (but excluding accounts receivable, endorsement for collection or deposits arising in the ordinary course of business) and (c) other guarantees of indebtedness of any Person with a Significant Midstream Business or any other credit support or contingent obligation with respect to indebtedness or other liability of such Person.

3

1.19 Midstream Oil Assets means any Midstream Assets, substantially all of the value of which is attributable to the Midstream Oil Business.

1.20 Midstream Oil Business means: (a) crude oil storage, terminalling and gathering activities in any state in the United States, except for Alaska and Hawaii, for any Person, (b) crude oil marketing activities, and (c) transportation of crude oil by pipeline in any state in the United States, except for Alaska and Hawaii, for any Person. A Midstream Oil Business shall not include any activities required to be performed by a any Party or Affiliate thereof as the operator pursuant to any operating agreement entered into by such Person with respect to oil and gas properties owned jointly with other Persons.

1.21 Midstream Oil Investment means any Midstream Investment substantially all of the value of which is attributable to the Midstream Oil Business.

1.22 Midstream Oil Opportunity means any Midstream Opportunity substantially all of the value of which is attributable to the Midstream Oil Business.

1.23 Midstream Opportunity means any business opportunity that falls [primarily] within the scope of the Midstream Business, including any proposal or opportunity with respect to any Midstream Investment, any proposed purchase of Midstream Assets, any proposed sale, lease, transfer or other disposition of Midstream Assets, any proposed purchase of Securities of, any proposed sale or other transfer of Securities of, any proposed loan, guarantee or other extension of credit to, or any proposed merger or acquisition of or with, any Person with a Significant Midstream Business or other projects, plans or proposals that are capital in nature and that relate primarily to the Midstream Business.

1.24 Minimum Participation Equity Amount means, with respect to a particular Midstream Opportunity, an amount equal to (i) $1,000,000, if the initial equity value of the Acquisition Company with respect to such Midstream Opportunity based on initial equity contributions to be made to such Acquisition Company (with respect to such Midstream Opportunity, the “Initial Equity Value”) is less than or equal to $25,000,000, and (ii) the greater of (x) $2,000,000 and (y) 1% of the Initial Equity Value, if the Initial Equity Value is greater than $25,000,000.

1.25 MLP means Plains All American Pipeline, L.P., a Delaware limited partnership, and its Subsidiaries.

1.26 MLPGP means Plains All American GP LLC, a Delaware limited liability company. NonAffiliate Purchaser shall have the meaning set forth in Section 2.6(b)(ii).

1.28 Notifying Party shall have the meaning set forth in Section 2.1(a).

1.29 Oil Assets Purchaser shall have the meaning set forth in Section 2.6.

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1.30 Offer shall have the meaning set forth in Section 2.6(a).

1.31 Opportunity Notice shall have the meaning set forth in Section 2.1(a).

1.32 Participation Terms shall have the meaning set forth in Section 2.3(b).

1.33 Party or Parties shall have the meaning set forth in the introduction hereto.

1.34 Permitted Receiving Persons shall have the meaning set forth in section 2.6(d).

1.35 Person means an individual, partnership, limited partnership, limited liability partnership, limited liability company, foreign limited liability company, trust, estate, corporation, custodian, trustee, executor, administrator, nominee or any other entity.

1.36 Pursue means, with respect to a particular Midstream Opportunity, to pursue or exploit, or to assist, encourage or facilitate any other Person in pursuing or exploiting, such Midstream Opportunity.

1.37 Raymond shall have the meaning set forth in the introduction hereto.

1.38 Raymond Employment Agreement means the Employment Agreement, dated as of the date hereof, between the Company and Raymond, as such agreement may be amended or modified from time to time in accordance with its terms.

1.39 Restricted Business shall have the meaning set forth in Section 2.6.

1.40 Rolling Period means any four consecutive calendar quarters.

1.41 Second Offer shall have the meaning set forth in Section 2.6(c).

1.42 Securities means any (a) privately or publicly issued capital stock, bonds, notes, debentures, commercial paper, bank acceptances, trade acceptances, trust receipts and other obligations, choses in action, partnership interests, instruments or evidences of indebtedness commonly referred to as securities, warrants, options, including puts and calls or any combination thereof and the writing of such options, and (b) any claims or other causes of action, matured or unmatured, contingent or otherwise, of creditors and/or equity holders of any Person against such Person, including “claim” and “interests”, in each case as defined under Title 11 of the United States Code entitled “Bankruptcy” (as the same may be hereafter amended from time to time, and any successor statute or statutes thereto), and all rights and options relating to the foregoing.

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1.43 Significant Midstream Business means, with respect to a particular Person, the Midstream Business of such Person if more than 50% of the fair market value of such Person’s assets were Midstream Assets.

1.44 Stockholders’ Agreement shall have the meaning set forth in the recitals hereto.

1.45 Structured Investment means an investment in any public or private Securities that represent less than 25% of the equity ownership of the issuer on a fully diluted basis, or that are convertible into less than 25% of the equity ownership of the issuer on a fully diluted basis; provided, however, that with respect to any Midstream Oil Investment, such investment shall be a passive investment.

1.46 VIM Representative means any senior officer or portfolio manager of the investment management division of Vulcan Inc. or any executive officer in the investment management division of any other entity 80% of the equity of which is owned by Allen or his Controlled Affiliates and that manages private equity investments on his behalf.

ARTICLE II

COVENANTS

2.1 Midstream Opportunities.

(a) Obligation to Give Notice of Midstream Opportunities. If any Management Stockholder or any VIM Representative has actual knowledge of any bona fide Midstream Opportunity that such person reasonably believes would be considered by MLP or the Company and that such person has the right to fulfill or to direct to another Person for fulfillment, such person (the “Notifying Party”) shall promptly notify the Company, MLP (with respect to any Midstream Oil Opportunity) and the other Parties orally or in writing (including by email) of such Midstream Opportunity (such notice, the “Opportunity Notice”); provided, however, that no such person shall be required to give any such notice where doing so could reasonably be deemed to cause such person or any of its Affiliates to breach any contractual, fiduciary or other obligation owed to any Person or is reasonably likely to subject such person to a claim that such notice would breach any contractual, fiduciary or other obligation, in each case other than any obligation undertaken primarily for the purpose of enabling a Party to avoid its commitments and obligations under this Agreement. Promptly upon request by the Company, any other Party or, if applicable, MLP, the Notifying Party shall provide all relevant information regarding the Midstream Opportunity in the possession of the Notifying Party to the requesting party; provided, further, however that there shall be no obligation to notify MLP of any Midstream Opportunity that is not a Midstream Oil Opportunity. Allen shall direct, and shall use reasonable efforts to cause, the VIM Representatives to comply with this Agreement.

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(b) Exploitation of Midstream Opportunities. Except as otherwise set forth in this Article II, no Party shall, or shall cause its Controlled Affiliates to, Pursue any Midstream Opportunity; provided, however, that following compliance with the notice requirements of Section 2.1(a) and subject to Section 2.1(e), the Notifying Party may, and may cause any of its Controlled Affiliates to Pursue such Midstream Opportunity if the Company shall have elected not to Pursue such Midstream Opportunity (either directly or through a Subsidiary); provided, further, however, that if Allen elects to Pursue such Midstream Opportunity pursuant to Section 2.1(c) below, regardless of whether Flores and/or Raymond (or their designees on the board of directors of the Company) concurred in the Company’s determination not to Pursue such Midstream Opportunity, such election by Allen shall have the effect of prohibiting any Management Stockholder from Pursuing, and from causing its respective Controlled Affiliates to Pursue, such Midstream Opportunity.

(c) Allen’s Exploitation Right. Notwithstanding Section 2.1(b), if the Company shall have elected not to Pursue a Midstream Opportunity (either directly or through a Subsidiary), regardless of whether Flores and/or Raymond (or their designees on the board of directors of the Company) concurred in the Company’s determination not to Pursue such Midstream Opportunity, Allen may Pursue such Midstream Opportunity (either directly or through a Subsidiary or a Controlled Affiliate) to the exclusion of the Management Stockholders, provided that Allen complies with Section 2.3 with respect to such Midstream Opportunity.

(d) Deemed Election Not to Pursue. For purposes of Section 2.1(b), each of the Company and Allen shall be deemed to have elected not to Pursue a Midstream Opportunity that is not a Midstream Oil Opportunity if it does not give notice to the Parties of its determination to Pursue such Midstream Opportunity (either directly or through a Subsidiary or a Controlled Affiliate) within 15 days after its receipt of the Opportunity Notice with respect to such Midstream Opportunity. In addition, if the Company or Allen abandons its efforts to Pursue (either directly or through a Subsidiary or a Controlled Affiliate) such Midstream Opportunity, it shall be deemed to have elected not to Pursue such Midstream Opportunity at the time of such abandonment. If the Company or Allen should abandon such efforts, it will give notice thereof to the Management Stockholders as soon as reasonably practicable.

(e) Exploitation of Midstream Oil Opportunities. No Party shall, or shall cause its Controlled Affiliates to, Pursue any Midstream Oil Opportunity other than by assisting MLP; provided, however, that notwithstanding any other provision of this Agreement to the contrary, the opportunity to acquire directly or indirectly any membership interest in MLPGP or any Security issued by any Subsidiary of MLPGP or by MLP shall not constitute a Midstream Oil Opportunity for purposes this Agreement.

2.2 Exceptions.

(a) Failure to Meet Performance Criteria. Notwithstanding anything in this Agreement to the contrary, Section 2.1 shall not apply to Allen or any VIM Representative with respect to Midstream Opportunities that Allen or any

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VIM Representative first learned about from a source other than a Management Stockholder, other than Midstream Oil Opportunities, at any time that the Company does not meet the Applicable Performance Criteria. Without limiting the generality of the foregoing, Allen shall not be obligated to, or to direct or cause any VIM Representative to, notify the Company or the Management Stockholders of, and Allen shall not be prohibited from Pursuing, and Allen shall not be prohibited from causing its Controlled Affiliates to Pursue, any Midstream Opportunity that is not a Midstream Oil Opportunity of which Allen becomes aware during any period that the Company does not meet the Applicable Performance Criteria, regardless of whether the Company subsequently meets the Applicable Performance Criteria; provided, that Allen first learned of such Midstream Opportunity on a nonconfidential basis from a source other than the Notifying Party; provided, further, that such source was not known by Allen to be bound by any agreement with the Notifying Party to keep such information confidential, or otherwise prohibited from transmitting the information to Allen by a contractual, legal or fiduciary obligation.

(b) Structured Investments. Notwithstanding anything in this Agreement to the contrary, Section 2.1 shall not apply to any Structured Investment.

(c) Insignificant Midstream Business. For the avoidance of doubt, Section 2.1 shall not apply to any Midstream Opportunity if such midstream Opportunity is with respect to a Person not having a Significant Midstream Business.

(d) Recognition of Fiduciary Obligations. Notwithstanding anything in this Agreement to the contrary and without limiting the proviso to Section 2.1(a), it is understood and acknowledged that each of the Parties has, and may continue to have, fiduciary obligations to others by virtue of his investments in, or relationships with, other companies, and notwithstanding anything in this Agreement to the contrary, nothing contained in this Agreement shall be deemed to require any Party to take or fail to take any action where doing so could reasonably be deemed to cause such Party or any of its Affiliates to breach any fiduciary or other similar obligation owed to any Person or is reasonably likely to subject such Party to a claim that such action or failure to act would breach any fiduciary or other similar obligation, in each case other than any obligation undertaken primarily for the purpose of enabling a Party to avoid its commitments and obligations under this Agreement.

2.3 Management Stockholders’ Participation Right.

(a) If Allen elects to Pursue a Midstream Opportunity (either directly or through a Subsidiary) pursuant to Section 2.1(c), then Allen shall offer each Management Stockholder the opportunity to invest in the acquisition vehicle for such transaction (with respect to each such Midstream Opportunity, an “Acquisition Company”) on the Participation Terms (as defined herein) applicable to such Midstream Opportunity. For the avoidance of doubt, neither Allen nor the Company shall be required to offer the Participation Terms to the Management Stockholders with respect to any Midstream Opportunity exploited by or through the Company.

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(b) The “Participation Terms” means, with respect to a particular Midstream Opportunity, the following terms:

(i) The participating Management Stockholders shall be required to purchase, collectively, the Minimum Participation Equity Amount of the equity of the Acquisition Company for such Midstream Opportunity on the same terms and conditions as such equity is issued to Allen or his designee; provided, however, that each participating Management Stockholder shall also be offered the opportunity to purchase the greater of (x) its pro-rata share (based on its fully diluted percentage ownership of the Company, calculated based on the treasury method, at such time) and (y) 20%, of the initial equity in such Acquisition Company on the same terms and conditions as such equity is issued to Allen or his designee; provided, further, that each Participating Stockholder shall be required to enter into a stockholders’ agreement with Allen or his designee which contains terms which are substantially similar to those set forth in Articles III, IV, VI and VII of the Stockholders’ Agreement; and

(ii) Each participating Management Stockholder shall be provided the Incentive Arrangements (as defined herein) with respect to such Midstream Opportunity; provided, however, that (x) if Allen reasonably believes in good faith that the participating Management Stockholder or Management Stockholders are not capable of, or are not willing to, manage the business and affairs of the Acquisition Company (1) in a manner that is reasonably satisfactory to Allen and (2) on terms and conditions substantially similar to those set forth with respect to the Company in the Stockholders’ Agreement, then Allen shall be entitled to direct the participating Management Stockholder or Management Stockholders to identify and, subject to Allen’s approval in his reasonable discretion, hire other individuals to act as operating management with respect to such Acquisition Company and (y) the compensation arrangements for any operating management hired pursuant to clause (x) shall (1) be acceptable to Allen in his reasonable discretion and (2) be derived solely from the aggregate Incentive Arrangements with respect to such Midstream Opportunity, and appropriate adjustments shall be made to the terms of the Incentive Arrangements to reflect the participation of such operating management. For purposes of clause (y)(2) of the proviso to the immediately preceding sentence, in any case where there is only one participating Management Stockholder and additional operating management is hired pursuant to clause (x) of such proviso, the aggregate Incentive Arrangements shall be determined as if there were two participating Management Stockholders. For the avoidance of doubt, neither the requirement by Allen of the hiring of operating management

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nor the sharing of the Incentive Arrangements with such operating management with respect to a particular Midstream Opportunity pursuant to the proviso to the preceding sentence shall preclude Allen from pursuing such Midstream Opportunity pursuant to Section 2.1(c).

(c) The “Incentive Arrangements” means, with respect to a particular Midstream Opportunity to which they apply, the following terms:

(i) Each participating Management Stockholder shall be granted an option to purchase an additional number of shares of common equity of the Acquisition Company for such Midstream Opportunity equal to 5% of the aggregate number of shares of common equity of the Acquisition Company issued in connection with such Midstream Opportunity, subject to Section 2.3(b)(ii). The exercise price of such option shall be the price at which such shares of common equity are issued in connection with such Midstream Opportunity, and the shares covered by such option shall vest in five equal annual installments, commencing on the first anniversary of the closing date of the consummation of the transaction that exploits such Midstream Opportunity; and

(ii) The Acquisition Company for such Midstream Opportunity shall have an obligation to make an incentive payment to each participating Management Stockholder on terms and conditions substantially similar to those set forth in the “Management Incentive Payment” provision of such participating Management Stockholder’s Employment Agreement (and the related definitions).

(d) The Parties agree to consider alternative structures that provide substantially similar economics to the Parties by using different classes of capital stock.

2.4 Cooperation. Each Party shall cooperate fully with the Company, Allen and MLP in any evaluation or pursuit of any Midstream Opportunity presented to the Company, Allen or MLP hereunder. Without limiting the generality of the foregoing, if any Midstream Opportunity is available only to the Notifying Party, such Party shall use reasonable efforts to cause such Midstream Opportunity to be made available to the Company, MLP and/or Allen. To the extent neither the Company nor Allen elects to Pursue a Midstream Opportunity under Section 2.1(d) or otherwise, either or both Management Stockholders may Pursue such Midstream Opportunity. The Parties acknowledge and agree that the fact that a Midstream Opportunity may only be available to the Notifying Party shall not affect the applicability of this Article II to such Midstream Opportunity.

2.5 Remedies. Each Party recognizes that a breach by it of this Article II will result in irreparable damage and harm to each of the other Parties and its

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respective Affiliates and that each of the other Parties and its respective Affiliates may be without an adequate remedy at law in the event of any such activities. Each Party agrees, therefore, if any provision of Article II is breached, then each of the non-breaching Parties and its Affiliates may at its election institute and prosecute proceedings in any court of competent jurisdiction: (a) to obtain specific performance by the breaching Party of Article II; (b) to enjoin the breaching Party from engaging in the activities proscribed by Article II; or (c) to pursue any one or more of the foregoing or any other remedy available to it under applicable law, including actual damages. Any non-breaching Party and its respective Affiliates will not, by seeking or obtaining such relief, be deemed to have precluded themselves from obtaining any other relief to which they may be entitled. Each of the Parties hereby waives any requirement that the non-breaching Parties or their respective Affiliates post any bond or other security in connection with the enforcement of this Agreement.

2.6 Restricted Business Procedures. If any Management Stockholder, Allen or the Company or any of the Company’s Subsidiaries acquires a Midstream Business that is not a Midstream Oil Business but includes Midstream Oil Assets valued in excess of $10 million as of the date of acquisition, as determined in good faith by the Company’s board of directors (such Midstream Oil Assets, a “Restricted Business”), then not later than 30 days after the consummation of the acquisition by such Person (the “Oil Assets Purchaser”) of the Midstream Business, the Oil Assets Purchaser shall notify MLP of such purchase and offer MLP (or cause an offer to be made to MLP of) the opportunity to purchase such Restricted Business. If within 30 days after receipt of such notification, MLP fails to notify the Oil Assets Purchaser of its intentions with respect to the Restricted Business, all rights under this Section 2.6 with respect to such Restricted Business will terminate and the Oil Assets Purchaser may continue to own and operate such Restricted Business. For the avoidance of doubt, the provisions of this Section 2.6 shall not apply to any Structured Investment. If MLP notifies the Oil Assets Purchaser that MLP has elected to purchase such Restricted Business, then the following procedures shall be followed:

(a) The Oil Assets Purchaser shall submit a good faith offer to MLP to sell the Restricted Business (the “Offer”) to MLP on the terms and for the consideration stated in the Offer.

(b) The Oil Assets Purchaser and MLP shall negotiate in good faith, for 60 days after receipt of such Offer by the MLP, the terms on which the Restricted Business will be sold to MLP. The Oil Assets Purchaser shall provide all information concerning the business, operations and finances of such Restricted Business as MLP may reasonably request.

(i) If the Oil Assets Purchaser and the MLP agree on such terms within 60 days after receipt by the MLP of the Offer, MLP shall purchase the Restricted Business on such terms as soon as commercially practicable after such agreement has been reached.

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(ii) If the Oil Assets Purchaser and the MLP are unable to agree on the terms of a sale during such 60-day period, the Oil Assets Purchaser shall attempt to sell the Restricted Business to a Person that is not an Affiliate of the Oil Assets Purchaser (a “NonAffiliate Purchaser”) within nine months of the termination of such 60-day period. Any such sale to a NonAffiliate Purchaser must be for a purchase price, as determined in good faith by the Company’s board of directors, not less than 95% of the purchase price last offered by MLP.

(c) If, after the expiration of such nine-month period, the Oil Assets Purchaser has not sold the Restricted Business to a NonAffiliate Purchaser, it shall submit another Offer (the “Second Offer”) to MLP within seven days after the expiration of such nine-month period. The Oil Assets Purchaser shall provide all information concerning the business, operations and finances of such Restricted Business as may be reasonably requested by MLP.

(i) If MLP elects not to negotiate with the Oil Assets Purchaser regarding the Second Offer, the Oil Assets Purchaser shall be free to continue to engage in such Restricted Business.

(ii) If MLP elects to purchase such Restricted Business, then MLP and the Oil Assets Purchaser shall negotiate the terms of such purchase for 60 days. If the Oil Assets Purchaser and MLP agree on such terms within 60 days after receipt by MLP of the Second Offer, MLP shall purchase the Restricted Business on such terms as soon as commercially practicable after such agreement has been reached.

(iii) If during such 60-day period, no agreement has been reached between the Oil Assets Purchaser and MLP, the Oil Assets Purchaser and MLP will engage an independent investment banking firm with a national reputation to determine the value of the Restricted Business. Such investment banking firm will determine the value of the Restricted Business within 30 days and furnish the Oil Assets Purchaser and MLP its opinion of such value. The Oil Assets Purchaser and MLP will each pay one-half of the fees and expenses of such investment banking firm. Upon receipt of such opinion, the MLP shall have the option to (A) purchase the Restricted Business for an amount equal to the value determined by such investment banking firm or (B) decline to purchase such Restricted Business, in which event the Oil Assets Purchaser will be free to continue to engage in such Restricted Business.

(d) MLP may not avail itself of its rights under this Section 2.6 unless it executes (and the Oil Assets Purchaser would also be required to execute) a confidentiality agreement having the following provisions.

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(i) each shall acknowledge that it, its Affiliates and its and its Affiliates’ employees, agents, advisors or representatives (collectively, “representatives”) possess and may thereafter obtain, confidential business, commercial, technical, financial and operational information from the other parties to such agreement, their respective Affiliates and their respective businesses and which relates to the past, ongoing or future operations of the Restricted Business and the Oil Assets Purchaser’s business and operations (collectively, such information, whether obtained in written form, visually (such as by inspection) or orally, is hereinafter referred to as “Confidential Information”). For purposes of such agreement, the “Confidential Information of a party” would include the Confidential Information of such Person’s Affiliates. With respect to such Confidential Information, each of the Oil Assets Purchaser and MLP would covenant to the other as follows:

(ii) Each party would agree to exercise the same degree of care as it uses in protecting its own Confidential Information from disclosure (but not less than reasonable care), to make no disclosure of any Confidential Information received from any other party, and would further agree to make no use of any Confidential Information received from any other party except, in each case, in connection with the transactions contemplated by the potential transfer of the Restricted Business. Notwithstanding the foregoing, to the extent required by law, any such parties (and each representative of such parties) would be permitted to disclose to any and all Persons, without limitation of any kind, the tax treatment and any facts that may be relevant to the tax structure of any such transaction, provided, however, that no such party (and no employee, representative, or other agent thereof) would be entitled to disclose any other information that is not relevant to understanding the tax treatment and tax structure of the transaction (including the identity of any party and any information that could lead another to determine the identity of any party), or any other information to the extent that such disclosure could result in a violation of any federal or state securities law.

(iii) The obligations of non-disclosure and restricted use contained in such agreement would not apply to any of the disclosing party’s Confidential Information that:

(1) was available to the public prior to the date such Confidential Information was disclosed to the receiving party;

(2) became available to the public through no fault of the receiving party subsequent to the date such Confidential Information was disclosed to the receiving party;

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(3) was in the possession of the receiving party prior to the date such Confidential Information was disclosed to the receiving party, and was not obtained by the receiving party from a third party having an obligation of confidentiality to the disclosing party regarding such Confidential Information;

(4) was hereafter rightfully obtained by the receiving party from a third party not under an obligation of confidentiality to the disclosing party regarding such Confidential Information; or

(5) was independently developed by employees of the receiving party without using the Confidential Information of the disclosing party.

It would not be a breach of the obligation of non-disclosure contained in such agreement if a receiving party disclosed any Confidential Information as required by law or judicial proceeding; provided, however, that such disclosure would be excused only to the extent such disclosure was required by law or such proceeding and only if, to the extent reasonably practicable, the receiving party provided prior written notice to the disclosing party sufficient to allow the disclosing party an opportunity to oppose or attempt to limit the required disclosure, and only if the receiving party itself used reasonable efforts to ensure that the confidentiality of the Confidential Information is protected by court or administrative order at no cost to such receiving party.

(i) Each party would have the right to disclose to its Affiliates and representatives (collectively, its “Permitted Receiving Persons”) all Confidential Information received under such agreement; however each receiving party would warrant that its Permitted Receiving Persons would comply with all of the obligations set out in such agreement, and would further agree to be responsible for all harm caused by any non-compliance by any Permitted Receiving Person of the receiving party with any of the obligations set out in such agreement, to the same extent the receiving party would have been responsible under applicable law for its own breach of the same obligations.

(ii) Each party would agree to use reasonable efforts to inform all of its Permitted Receiving Persons to whom Confidential Information of any other party is disclosed, of the existence of such agreement and of the confidential nature of such Confidential Information.

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ARTICLE III

TERMINATION

3.1 Complete Termination. This Agreement shall be terminated in accordance with, and subject to, the following provisions:

(a) Mutual Agreement. This Agreement may be terminated by mutual written agreement of the Parties;

(b) Termination of Stockholders’ Agreement. This Agreement shall terminate automatically upon termination of the Stockholders’ Agreement;

(c) Default by Allen (Other Than Section 2.1(a)). This Agreement may be terminated by Flores and Raymond by written notice to Allen if Allen breaches or fails to perform in any material respect any of his respective representations, warranties, covenants or other agreements contained in this Agreement (other than Section 2.1(a)), the Subscription Agreement or the Stockholders Agreement, provided that such breach or failure is not remedied within a period of 30 calendar days following receipt of written notice of such default; provided, however, that the termination right under this Section 3.1(c) shall not be available if Flores or Raymond has breached or failed to perform in any material respect any of his respective representations, warranties, covenants or other agreements contained this Agreement or, if applicable, the Subscription Agreement, the Stockholders’ Agreement or such Party’s employment agreement with the Company. In the event of a breach or failure to perform in any material respect of Allen’s or Allen’s respective representations, warranties, covenants or other agreements contained in this Agreement, the Subscription Agreement or the Stockholders’ Agreement, as applicable, Flores and/or Raymond shall give written notice of such breach or failure to Allen in sufficient detail to enable Allen to cure the default;

(d) Default by Allen Under Section 2.1(a). This Agreement may be terminated by Flores and Raymond by written notice to Allen if Allen intentionally breaches or fails to perform in any material respect his obligations under Section 2.1(a) of this Agreement, provided that in any such case such breach or failure is not remedied within a period of 30 calendar days following receipt of written notice of such default; provided, however, that the right to terminate this Agreement under this Section 3.1(d) shall not be available if Flores or Raymond has breached or failed to perform in any material respect any of its respective representations, warranties, covenants or other agreements contained this Agreement or, if applicable, the Subscription Agreement, the Stockholders’ Agreement or such Party’s employment agreement with the Company. In the event of a breach or failure to perform in any material respect of Allen’s obligations under Section 2.1(a) of this Agreement, Flores and/or Raymond shall give written notice of such breach or failure to Allen in sufficient detail to enable Allen to cure the default;

(e) Failure to Meet Applicable Performance Criteria. During any Underperformance Period, Allen may terminate this Agreement if he provides written notice thereof to the Management Stockholders prior to the end of such period. An “Underperformance Period” means any period beginning when the Applicable Performance Criteria has not been met for four consecutive Rolling Periods and ending at the end of the next four consecutive Rolling Periods, if any, for which the Applicable Performance Criteria has been met;

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(f) Sable Change of Control. This Agreement may be terminated by Allen by giving written notice thereof to the Management Stockholders, if any Person or “Group” (as such term is used in Section 13(d) of the Exchange Act, other than Flores or/and Raymond or any entity or entities controlled by either Flores and/or Raymond, is or becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act)), of (a) more than 50% of the general or limited partnership interests in Sable Investments, L.P. or (b) stock or other equity interest of any legal entity that controls Sable Investments, L.P. representing more than 50% of the voting interests entitled to vote generally for the election of the board of directors or other governing body of such entity; and

(g) Change of Control. This Agreement shall terminate automatically if Allen and his Affiliates should no longer be able to appoint at least two directors to the Company’s board of directors or if Allen and his Affiliates should cease to own at least 50% of the Company’s outstanding common stock

3.2 Termination with respect to a Management Stockholder. (a) This Agreement shall be terminated with respect to a particular Management Stockholder (i) automatically if Allen and/or any other Management Stockholder shall have exercised its Call Right with respect to such Management Stockholder pursuant to Section 4.13 of the Stockholders’ Agreement, (ii) at such Management Stockholder’s option if (A) his employment is terminated without Cause or (B) he terminates his employment for Good Reason under his Employment Agreement (as such terms are defined in his Employment Agreement), and (iii) at Allen’s option or such Management Stockholder’s option at the end of the then-current term of such Management Stockholder’s Employment Agreement if such term is not extended for any additional one year term as contemplated thereby.

(b) Default (Other Than Section 2.1(a)). This Agreement may be terminated by Allen with respect to a particular Management Stockholder by written notice to such Management Stockholder if such Management Stockholder breaches or fails to perform in any material respect any of his respective representations, warranties, covenants or other agreements contained in this Agreement (other than Section 2.1(a)), the Subscription Agreement, the Stockholders’ Agreement or such Management Stockholders’ employment agreement with the Company, provided that such breach or failure is not remedied within a period of 30 calendar days following receipt of written notice of such default; provided, however, that the termination right under this Section 3.2(b) shall not be available if Allen has breached or failed to perform in any material respect any of its respective representations, warranties, covenants or other agreements contained this Agreement, the Subscription Agreement or the Stockholders Agreement. In the event of a breach or failure to perform in any material respect of a Management Stockholder’s respective representations, warranties, covenants or other agreements contained in this Agreement or, if applicable, the Subscription Agreement, the Stockholders’ Agreement or such Management Stockholder’s employment agreement, Allen shall give written notice of such breach or failure to the defaulting Party in sufficient detail to enable the defaulting Party to cure the default;

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(c) Default Under Section 2.1(a). This Agreement may be terminated by Allen with respect to a particular Management Stockholder by written notice to such Management Stockholder if such Management Stockholder intentionally breaches or fails to perform in any material respect any of his respective obligations under Section 2.1(a) of this Agreement, provided that such breach or failure is not remedied within a period of 30 calendar days following receipt of written notice of such default; provided, however, that the termination right under this Section 3.2(c) shall not be available if Allen has breached or failed to perform in any material respect any of its respective representations, warranties, covenants or other agreements contained this Agreement, the Subscription Agreement or the Stockholders Agreement. In the event of a breach or failure to perform in any material respect of a Management Stockholder’s respective obligations under Section 2.1(a) of this Agreement, Allen shall give written notice of such breach or failure to the defaulting Party in sufficient detail to enable the defaulting Party to cure the default;

(d) Other Instances. This Agreement may be terminated by Allen with respect to a particular Management Stockholder immediately by giving written notice thereof to such Management Stockholder, if a Call Event (as defined in the Stockholders’ Agreement) occurs with respect to such Management Stockholder.

3.3 Effect of Termination.

(a) Upon the termination of this Agreement pursuant to Section 3.1, no Party nor any of its Affiliates, stockholders, directors, officers or representatives will have any further obligation to the other, except that: no termination will prejudice any claim any Party may have that arises prior to the effective date of such termination.

(b) Upon the termination of this Agreement with respect to a Party pursuant to Section 3.2, such Party and its Affiliates, stockholders, directors, officers or representatives will have no further obligation to the remaining Parties, and the remaining Parties and their respective Affiliates, stockholders, directors, officers or representatives will have no further obligation to such Party, except that no termination will prejudice any claim any Party may have that arises prior to the effective date of such termination.

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ARTICLE IV

REPRESENTATIONS AND WARRANTIES

Each Party, severally and not jointly, represents and warrants to the other Parties as follows:

4.1 Due Organization. If such Person is not a natural person, such Person is a corporation, partnership, trust or other entity duly organized, validly existing and in good standing under the laws of such Person’s jurisdiction of organization.

4.2 Due Authorization; Enforceability. This Agreement has been duly authorized, executed and delivered by such Person and constitutes a valid and binding obligation of such Person enforceable against such Person in accordance with its terms, except that such enforceability (i) may be limited by bankruptcy, insolvency, moratorium or other similar laws affecting or relating to the enforcement of creditors’ rights generally and (ii) is subject to general principles of equity and the discretion of the court before which any proceedings seeking injunctive relief or specific performance may be brought.

4.3 No Conflicts. Neither the execution and delivery of this Agreement, nor the consummation of the transactions contemplated hereby, nor compliance by such Person with any of the provisions hereof will (i) conflict with or result in a breach of any provision of the Certificate of Incorporation or Bylaws or other constituent documents of such Person, (ii) constitute or result in a breach of any term, condition or provision of, or constitute a default under, or give rise to any right of termination, cancellation or acceleration with respect to, or result in the creation of any lien, charge or encumbrance upon any property or asset of such Person pursuant to any note, bond, mortgage, indenture, license, agreement or other instrument or obligation to which such Person is a party, or (iii) violate any order, writ, injunction, decree, statute, rule or regulation applicable to such Person.

ARTICLE V

MISCELLANEOUS

5.1 Notices. All notices, consents, requests, demands and other communications which are required or may be given pursuant to the terms of this Agreement shall be in writing and shall be deemed duly given or delivered (i) when received if delivered by hand, (ii) the Business Day after their deposit with a recognized overnight commercial courier (receipt requested), or (iii) upon receipt if sent by telecopier (with receipt confirmed), provided that with respect to clause (iii) a copy is either promptly thereafter mailed in the United States by first-class postage pre-paid mail or sent by a recognized overnight commercial courier (receipt requested), to the Party as follows:

If to the Company:	Vulcan Energy Corporation
	505 Fifth Ave S Suite 900
	Seattle, WA 98104
	Fax: (206) 342-3000
	Attention: David Capobianco

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Copies (which shall not constitute notice) to:	Skadden, Arps, Slate,
	Meagher & Flom LLP
	1600 Smith
	Suite 4400
	Houston, Texas 77002
	Fax: (713) 655-5200
	Attention: Frank Ed Bayouth II
	Nicholas Saggese
	and
	each Stockholder
	and
	Akin Gump Strauss Hauer & Feld LLP
	711 Louisiana St.
	Suite 1900 South Tower
	Houston, Texas 77002
	Fax: (713) 236-0822
	Attention: Michael Dillard
If to MLP:	Plains All American Pipeline LP
	333 Clay Street
	Suite 1600
	Houston, TX 77002
	Fax: (713) 654-4100
	Attention: Greg Armstrong
Copies (which shall not constitute notice) to:	Skadden, Arps, Slate,
	Meagher & Flom LLP
	1600 Smith
	Suite 4400
	Houston, Texas 77002
	Fax: (713) 655-5200
	Attention: Frank Ed Bayouth II
	Nicholas Saggese
	and
	each Stockholder
	and

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	Akin Gump Strauss Hauer & Feld LLP
	711 Louisiana St.
	Suite 1900 South Tower
	Houston, Texas 77002
	Fax: (713) 236-0822
	Attention: Michael Dillard
If to Allen:	c/o Vulcan Investment Management, Inc.
	505 Fifth Ave S Suite 900
	Seattle, WA 98104
	Fax: (206) 342-3000
	Attention:
Copy (which shall not constitute notice) to:	Skadden, Arps, Slate,
	Meagher & Flom LLP
	1600 Smith
	Suite 4400
	Houston, Texas 77002
	Fax: (713) 655-5200
	Attention: Frank Ed Bayouth II
	Nicholas Saggese
If to Flores:	c/o Plains Exploration and Production Company
	700 Milam, Suite 3100
	Houston, Texas 77002
	Fax: (832) 239-6210
	Attention: James C. Flores
Copy (which shall not constitute notice) to:	Akin Gump Strauss Hauer & Feld LLP
	711 Louisiana St.
	Suite 1900 South Tower
	Houston, Texas 77002
	Fax: (713) 236-0822
	Attention: Michael Dillard
If to Raymond:	c/o Plains Exploration and Production Company
	700 Milam, Suite 3100
	Houston, Texas 77002
	Fax: (832) 239-6210
	Attention: John T. Raymond

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Copy (which shall not constitute notice) to:	Akin Gump Strauss Hauer & Feld LLP
	711 Louisiana St.
	Suite 1900 South Tower
	Houston, Texas 77002
	Fax: (713) 236-0822
	Attention: Michael Dillard

or to such other address and/or telecopy number as any Party (or the acquiror of such Party’s shares of Common Stock) shall have designated by 15 days’ notice in writing to the other Parties. Notices other than notices under Section 2.1(a) may not be given by email or similar means.

5.2 Waivers. The Parties hereto may by written instrument (i) extend the time for the performance of any of the obligations or other acts of the other Parties hereto, and (ii) waive compliance or performance by any other Party with or of any of the covenants or agreements made to it by any other Party contained in this Agreement. The delay or failure on the part of any party hereto to insist, in any one instance or more, upon strict performance of any of the terms or conditions of this Agreement, or to exercise any right or privilege herein conferred shall not be construed as a waiver of any such terms conditions, rights or privileges but the same shall continue and remain in full force and effect. All rights and remedies are cumulative.

5.3 Amendments. All amendments to this Agreement will be in writing and must be signed by each of the Parties.

5.4 Applicable Law; Jurisdiction. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without giving effect to any of the conflict of law rules thereof. The Parties agree that the courts of Delaware (either State or Federal) are to have exclusive jurisdiction to settle any dispute arising in connection with the creation, validity, effect, interpretation or performance of, or the legal relationships established by this Agreement or otherwise arising in connection with this Agreement, and by execution of this Agreement, each Party hereby irrevocably submits to the jurisdiction of such courts and further irrevocably consents to the service of process outside of the territorial jurisdiction of such courts by mailing copies thereof by registered United States mail, postage prepaid, to its address specified herein.

5.5 Assignment. No Party shall be entitled to assign its rights or obligations under this Agreement without the prior written consent of the other Parties.

5.6 Binding Effect; Benefits. This Agreement shall inure to the benefit of, and be binding upon, the Parties to it and their respective successors, permitted assigns and other permitted transferees. Nothing contained in this Agreement, express or implied, is intended to confer upon any person or entity other than the Parties to it and their respective successors, permitted assigns and other permitted transferees, any rights

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or remedies under or by reason of this Agreement; provided that MLP is expressly made a third party beneficiary of Sections 2.1(e) and 2.6 of this Agreement; provided, further that such designation as a third party beneficiary shall not in any way limit the ability of the Parties to waive, amend or terminate this Agreement or any of such sections, in each case, without the consent of MLP.

5.7 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.

5.8 Invalidity. If any provision of this Agreement is held invalid or unenforceable, such invalidity or unenforceability shall not affect in any way the validity or enforceability of any other provision of this Agreement. In the event any provision of this Agreement is held invalid or unenforceable, the Parties shall attempt to agree on a valid or enforceable provision which shall be a reasonable substitute for such invalid or unenforceable provision in light of the tenor of this Agreement and, on so agreeing, shall incorporate such substitute provision in this Agreement.

5.9 Entire Agreement and Construction. This Agreement, together with the Subscription Agreement, the Stockholders’ Agreement and any exhibits, annexes and other documents contemplated hereby and thereby, contains the entire agreement among the Parties with respect to the subject matter hereof and all prior understandings and agreements shall merge herein. There are no additional terms, whether consistent or inconsistent, oral or written, which are intended to be part of the Parties’ understandings which have not been incorporated into this Agreement, the Subscription Agreement, the Stockholders’ Agreement and any exhibits, annexes and other agreements and documents contemplated hereby or thereby.

5.10 Expenses. Except as otherwise expressly provided herein, each party shall bear its owns fees, costs and expenses in connection with the transaction contemplated herein.

5.11 Interpretation. If any claim is made by any Party relating to any conflict, omission or ambiguity in this Agreement, no presumption or burden of proof or persuasion shall be implied by virtue of the fact that this Agreement was prepared by or at the request of a particular Party or its counsel.

5.12 Rules of Construction. For purposes of this Agreement:

(a) Unless the context otherwise requires; (i) words in the singular include the plural and words in the plural include the singular; (ii) words in the masculine include the feminine and words in the feminine include the masculine; (iii) a reference to any person or entity includes its successors and assigns and (iv) the words “include” or “including” shall be deemed to be followed by the phrase “without limitation”.

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(b) References to Articles or Sections are, unless otherwise specified, to Articles or Sections of this Agreement. The captions in this Agreement and the Table of Contents to this Agreement are for convenience of reference only and shall not be deemed to alter or affect any provision hereof or interpretation or construction hereof.

(c) References herein to any agreement or other instrument shall, unless the context otherwise requires (or the definition thereof otherwise specifies), be deemed references to the same as it may from time to time be changed, amended or extended.

(d) All pronouns and all variations thereof shall be deemed to refer to the masculine, feminine, or neuter, singular or plural, as the context in which they are used may require. Any reference to any statutes or laws will include all amendments, modifications, or replacements of the specific sections and provisions concerned.

5.13 No Partnership. Nothing in this Agreement shall be construed to create an association, trust, joint venture or partnership between any of the Parties or to impose a trust or partnership obligation or liability upon any Party. No Party shall have any right, power or authority to enter into any agreement or undertaking for, or to act on behalf of, or to act as or be an agent or representative of, or to otherwise bind, any other Party.

5.14 Electronic Signatures. Notwithstanding references in Section 2.1(a) to email, for purposes of determining whether a Party has signed this Agreement or any document contemplated hereby or any amendment or waiver hereof, only a handwritten signature on a paper document or a facsimile transmission of a handwritten original signature will constitute a signature, notwithstanding any law relating to or enabling the creation, execution or delivery of any contract or signature by electronic means.

* * * * *

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IN WITNESS WHEREOF, each of the Parties has executed this Agreement effective as of the date written above.

PAUL G. ALLEN

JAMES C. FLORES

JOHN T. RAYMOND

EX-99.D5

EXHIBIT(d)(5)

Proposed Employment Agreement

for

Flores

Summary of Key Terms

Overall Rationale: To secure the services of Jim Flores (the “Executive”) as the Executive Chairman of Vulcan Energy Corporation (the “Company”).

1. Position/Duties: Executive Chairman of the Company. Duties would include managing the Company’s administrative and operational matters, and identifying and/or analyzing potential transactions in the mid-stream energy market. Executive would be required to devote an amount of his business time to the performance of duties hereunder consistent with his past practice, or such additional time as shall be necessary and appropriate in light of the needs of the Company.

2. Contract Term: Initial term commences on the Closing Date and ends on January 1, 2015. Commencing on January 1, 2015, and each anniversary thereof, his employment will automatically be extended for successive one-year periods unless either party provides notice not to extend at least 90 days prior to such anniversary.

3. Annual Cash Compensation: $200,000.

4. Equity Compensation:

a) Option Grant: Executive’s existing options with respect to Plains Resources, Inc. (“PLX”) shares would be cancelled without compensation. Executive would be granted an option (the “Option”) to purchase a number of shares of common stock of the Company such that the number of shares subject to the Option would equal five percent of the shares of common stock of the Company on a fully diluted basis (determined based on the treasury method) on the date of grant (after giving effect to the transaction). The Option would vest with respect to 90% of the shares covered by the Option on a schedule consistent with the remaining vesting schedule for the Executive’s existing options (without regard to any acceleration of vesting in connection with the transaction), and the per share exercise price of that portion of the Option would be such as to maintain the aggregate spread implicit in Executive’s existing options (based on the Merger Price, as defined in the Subscription Agreement). The Option would vest with respect to the remaining 10% of the shares covered by the Option in 10 equal annual installments, commencing on the first anniversary of the effective date of the Executive’s employment agreement with the Company, and the per share exercise price of that portion of the Option would be the Initial Share Price (as defined in the Subscription Agreement). The Company would have the right to

terminate the Option at any Call Closing, provided that the Company would be required to pay an amount equal to the difference between the aggregate exercise price of the Option with respect to the vested shares under the Option and the aggregate call price with respect to such vested shares under the Option. In addition, in the event of a drag-along event, the Company would have the right to reduce the number of shares subject to the Option pro-rata based on the percentage of Executive’s shares sold in such drag-along transaction, provided that the Company would be required to pay an amount equal to the difference between the aggregate exercise price of the Option with respect to the reduced shares under the Option and the aggregate drag-along price with respect to such reduced shares. The number of shares to be reduced would first be applied against any vested shares and then to any unvested shares.

b) Restricted Shares: Executive would contribute his shares of PLX (both vested and unvested) to the Company in exchange for shares of the Company. Any Company shares received in respect of any PLX restricted shares would be subject to the same restrictions and vesting schedule (without regard to any acceleration of vesting in connection with the transaction). In addition, Executive would be granted a number of additional shares of restricted stock equal to $2.5 million divided by a fraction, the numerator of which is the Aggregate Consideration Amount (as defined in the Subscription Agreement) and the denominator of which is 20 million. The additional restricted stock would vest in 10 equal annual installments, commencing on the first anniversary of the effective date of the Executive’s employment agreement with the Company.

c) Waiver of Acceleration: Executive would waive the acceleration of vesting with respect to any shares of restricted stock or options of PLX in connection with the transaction.

d) Incentive Vesting: If either (i) the aggregate distributions per common unit paid by MLP during any four consecutive calendar quarters is greater than or equal to $2.70 (subject to adjustment in the event of any adjustments to the Minimum Quarterly Distribution or Target Distribution levels under Section 6.6 of the MLP Agreement) or (ii) the Notional Equity Value of the Company exceeds 2.5 times the Initial Notional Equity Value of the Company, then the Option and all outstanding shares of restricted stock would vest in full. “Notional Equity Value” means, as of a particular date, an amount equal to (i) the Initial Multiple times the operating income less maintenance and capital expenditures (in each case, excluding Calumet Florida) of the Company for the immediately preceding four quarters, (ii) less the Company’s total debt outstanding as of such date. “Initial Notional Equity Value” means, as of a particular date, the Notional Equity Value as of the Closing Date, adjusted to reflect on a proforma basis any asset sales and equity issuances occurring after

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the Closing Date. “Initial Multiple” means a fraction, the numerator of which is the Aggregate Consideration Amount (as defined in the Subscription Agreement), plus the Company’s total debt outstanding immediately following the Closing, minus $20 million, and the denominator of which is the operating income less maintenance and capital expenditures (in each case, excluding Calumet Florida) of the Company on an annualized pro forma basis based on the last full fiscal quarter preceding the Closing.

e) Vesting upon Sale Transaction. The Option and restricted shares shall vest upon consummation of a Sale Transaction (as defined in the Stockholders’ Agreement).

5. Tax Loans: Upon the exercise of any Option following its acceleration as described under “Incentive Vesting”, or upon the vesting of any restricted share, at Executive’s request the Company would be obligated to lend to Executive the funds necessary for Executive to pay the federal income tax incurred by Executive with respect to such exercise or vesting, such loan to be on the terms set forth on Exhibit A. Notwithstanding the foregoing, the Company shall not be obligated to make any such loan if doing so would be prohibited under or would result in a breach or default under any third party credit agreement or instrument to which the Company or any of its Subsidiaries is a party; provided, that the Company shall use reasonable efforts to obtain a waiver or consent under any such agreement or instrument to make such loan.

6. Option Exercise Loans: Upon the acceleration of any Option as described under “Incentive Vesting”, at Executive’s request, the Company would be obligated to lend to Executive the funds necessary for Executive to pay the strike price with respect to any unexercised portion of the Option, such loan to be on the terms set forth on Exhibit B. Notwithstanding the foregoing, the Company shall not be obligated to make any such loan if doing so would be prohibited under or would result in a breach or default under any third party credit agreement or instrument to which the Company or any of its Subsidiaries is a party; provided, that the Company shall use reasonable efforts to obtain a waiver or consent under any such agreement or instrument to make such loan.

7. Management Incentive Payment: The employment agreement shall include the incentive payment provisions set forth on Schedule I hereto.

8. Other Benefits: Executive shall become eligible for benefits under the Company’s welfare benefit and qualified retirement plans when and if he loses eligibility for such plans with another employer. Executive shall be granted annual vacation consistent with past practice.

9. Expenses: Executive will be entitled to reimbursement for reasonable and necessary expenses in carrying out his duties.

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10. Payments upon Termination: Upon termination of Executive’s employment, Executive would be entitled to receive the following benefits:

(a) Termination upon Death, Disability, or Cause or other than for Good Reason: In the event the employment agreement terminates upon the Death or Disability of the Executive, or the Executive is terminated by the Company with Cause or he resigns for other than Good Reason, the Executive would not be entitled to any benefits other than any unpaid salary or pro rata share of any non-discretionary bonus amounts accrued through the effective date of such termination or resignation and any other vested benefits that have accrued through such date pursuant to the terms of the Company’s benefit plans and any benefits required by applicable law. All unvested options and restricted stock would lapse.

(b) Termination for Good Reason . In the event the Executive resigns for Good Reason, the Executive would be entitled to receive (i) on the termination date, an amount equal to one times the aggregate of his annual salary under the employment agreement and the bonus, if any, Executive received in the immediately preceding year, (ii) continuation of participation in the Company’s welfare benefit plans available to senior executive officers through the 18^th month following the date of termination, and (iii) all outstanding equity awards would vest in full, and the Company would provide all associated rights with respect thereto as contemplated herein, including the right to borrow the funds required to fund the exercise of any stock options and any amounts payable as a result of the income taxes incurred as a result of such exercise or vesting.

(c) Definitions:

(i) Disability. Executive shall have been absent from the performance of his duties with the Company for six consecutive months as a result of Executive’s incapacity due to physical or mental illness.

(ii) Cause. (A) Executive’s willful failure to perform duties reasonably assigned to him by the board of directors of the Company in accordance with the terms of the employment agreement, (B) Executive’s engaging in conduct which is demonstrably and materially injurious to the Company and its subsidiaries taken as a whole, (C) Executive’s having been convicted of, or entered a plea of nolo contendere to, burglary, larceny, murder or arson, or a felony involving deceit, fraud, perjury or embezzlement, or (D) Executive’s material breach of any term of his employment agreement, the Stockholders’ Agreement or the Exclusivity Agreement (other than the notification provisions thereof). The Company must provide Executive with written notice detailing such conduct (accompanied by a resolution of the Company’s board of directors finding such conduct) and provide Executive reasonable opportunity to cure.

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(iii) Good Reason. Without Executive’s written consent (A) material breach of any of the Company’s obligations under the employment agreement, (B) assignment by the Board to Executive of any duties that materially adversely alter the nature or status of Executive’s office, title or responsibilities, (C) the Company’s requiring Executive to relocate anywhere other than the greater Houston, Texas metropolitan area, except for required travel on Company business to an extent substantially consistent with Executive’s obligations under his employment agreement or (D) Allen’s material breach of either the Stockholders’ Agreement or the Exclusivity Agreement (other than the notification provisions thereof); provided, however, that notwithstanding the foregoing, neither (1) the transfer of the location of the Company’s principal administrative (for example, benefits) and/or financial functions (but not the position or title of President or Chief Executive Officer) to any site designated by the Board nor (2) the assignment or delegation of such functions or responsibilities by the Board to any person other than Executive, shall constitute Good Reason. The Executive must provide the Company with written notice detailing such conduct and provide the Company reasonable opportunity to cure.

11. Gross-Up Payment: For purposes of avoiding the “golden parachute” excise tax imposed under Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), the effectiveness of Executive’s employment agreement shall be subject to the approval of the shareholders of the Company in accordance with Section 280G(b)(5) of the Code and the regulations thereunder. If, regardless of such shareholder approval, Executive would become subject to the “golden parachute” excise tax, Executive would be entitled to the greater after-tax benefit of (i) the total amount of the benefits provided under his employment agreement or (ii) a reduced portion of such benefits such that no portion of his benefits would be subject to the “golden parachute” excise tax. Notwithstanding the foregoing, if Executive becomes subject to the “golden parachute” excise tax with respect to the Merger due to the acceleration of his equity awards upon a termination without Cause or for Good Reason, then he would be entitled to a gross-up payment with respect to such excise tax on the same basis as his existing gross-up at PLX.

12. Confidentiality/ Non-Competition/Non-Solicitation: Executive would be subject to certain confidentiality provisions, as well as non-competition and non-solicitation restrictions for a period of one (1) year following termination of employment with the Company, provided that the non-competition and non-solicitation restrictions would not apply if Executive is terminated without Cause or terminates his employment for Good Reason or upon termination of the employment agreement upon exercise of the right to terminate the automatic extensions in Section 2 above.

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13. Effect on Existing Employment Arrangements: Executive’s existing employment agreement would terminate at the closing, and all rights and obligations, including any right to any severance payment or benefit, would terminate. Executive’s existing options would be cancelled without compensation. Executive’s existing restricted shares and restricted units would be converted into restricted shares in the Company as provided in the Subscription Agreement.

14. Mitigation: Executive would not be required to mitigate if the event of his termination.

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Exhibit A

Tax Loan Terms

Each tax loan shall be evidenced by a promissory note with the following terms:

1. Term: Principal and accrued but unpaid interest due and payable on January 2, 2015.

2. Rate: The Applicable Federal Rate applicable to a loan with a maturity equal to the period of time between the issuance of the note and January 2, 2015.

3. Security: Principal and interest secured by a first lien on all shares of Common Stock held by Executive.

4. Recourse: Beyond value of collateral, non-recourse to Executive.

5. Acceleration: (i) Principal and interest accelerate in full upon the occurrence of a Sale Transaction (as defined in the Stockholders Agreement) and (ii) accelerates pro-rata as to principal and accrued interest upon the sale of any shares of Common Stock.

6. Interest Payments: Accrue quarterly on a PIK-basis.

7. Prepayment: Prepayable at any time without a pre-payment penalty.

8. Assignability: The Company may assign the note, the security interest and all related security documents.

9. Default at Maturity: In the event that Executive fails to pay any outstanding principal and interest at maturity (other than maturity in respect of an acceleration event), if the holder of the note does not elect to extend the maturity date, the holder shall be entitled to foreclose on a number of shares of Common Stock securing the note equal to the aggregate amount of unpaid principal and interest divided by the “Fair Market Value” of such shares, determined in accordance with Section 4.13(e) of the Stockholders Agreement.

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Exhibit B

Option Exercise Loan Terms

Each option exercise loan shall be evidenced by a promissory note with the following terms:

1. Term: Principal and accrued but unpaid interest due and payable upon the earlier of (i) January 2, 2015 and (ii) the occurrence of a Sale Transaction (as defined in the Stockholders Agreement).

2. Rate: The Applicable Federal Rate applicable to a loan with a maturity equal to the period of time between the issuance of the note and January 2, 2015.

3. Security: Principal and interest secured by a first lien on all shares of Common Stock issued upon exercise of Option.

4. Recourse: Beyond value of collateral, recourse to Executive in an amount equal to 25% of the original principal amount of loan and 25% of accrued interest.

5. Acceleration: Pro-rata as to principal and accrued interest upon the sale of any shares of Common Stock.

6. Interest Payments: Accrue quarterly on a PIK-basis.

7. Prepayment: Prepayable at any time without a pre-payment penalty.

8. Assignability: The Company may assign the note, the security interest and all related security documents.

9. Default at Maturity: In the event that Executive fails to pay any outstanding principal and interest at maturity (other than maturity in respect of an acceleration event), if the holder of the note does not elect to extend the maturity date, the holder shall be entitled to foreclose on a number of shares of Common Stock securing the note equal to the aggregate amount of unpaid principal and interest divided by the “Fair Market Value” of such shares, determined in accordance with Section 4.13(e) of the Stockholders Agreement.

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Schedule I

Flores Incentive Provisions

1. Definitions

When used in this Schedule, the following terms shall have the meanings set forth below (all terms used in this Schedule that are not defined in this Section 1 shall have the meanings set forth elsewhere in this Schedule or, if not otherwise defined elsewhere in the Subscription Agreement, the meanings set forth in the Stockholders’ Agreement):

“Equity Value” means (i) if the Incentive Payment Amount is being determined with respect to a Sale Transaction, the aggregate net sales price of the equity of the Company in such Sale Transaction and/or, if such Sale Transaction results in proceeds to the Company, the aggregate net proceeds available for distribution to holders of shares of Common Stock after repayment of all indebtedness (including for the avoidance of doubt, any premium or prepayment or similar penalty) and other obligations of the Company and its Subsidiaries and the payment of all fees and expenses of the Company incurred in connection therewith and (ii) if the Incentive Payment Amount is being determined with respect to a request pursuant to Section 2(b) below, the aggregate value of the equity of the Company based on the fair market value in U.S. dollars of a share of Common Stock as of the date of the request giving rise to the determination of “Equity Value” which would reasonably be expected to be realized in an open market sale on arm’s length terms to a Person who is not an Affiliate of the seller or the buyer, having regard to all relevant factors, but without regard to (x) the availability or lack of availability of a market for such shares of Common Stock or (y) any minority discount that would otherwise be applicable to such shares of Common Stock, such “Equity Value” to be determined pursuant to Section 2(c) below.

“Flores Incentive Percentage” means 100%; provided, however, that (i) if the Flores Employment Agreement shall have been terminated as a result of death or disability, then the Flores Incentive Percentage shall be equal to the product of 100% and a fraction, the numerator of which is the number of months during which the Flores Employment Agreement was in effect (rounded up to the nearest whole month), and the denominator of which is 120, and (ii) if the Flores Employment Agreement shall have been terminated by the Company for “Cause” (as defined therein) or by Flores other than for “Good Reason” (as defined therein), then the Flores Incentive Percentage shall be zero.

“Incentive Payment Amount” means (i) if the Equity Value at the time of the Valuation Event is less than or equal to the Target Value at the time of the Valuation Event, then the Incentive Payment Amount shall be zero, and (ii) if the Equity Value at the time of the Valuation Event is greater than the Target Value at the time of the Valuation Event, then the Incentive Payment Amount shall be an amount equal to the lesser of (x) 2.5% of the amount by which the Equity Value exceeds the Invested Amount and (y) one-half of the amount by which the Equity Value exceeds the Target Value.

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“Incentive Shares” means a number of shares of Common Stock with a value (based on the Equity Value at the time of the Valuation Event giving rise to the obligation to deliver such shares under Section 2 below) equal to the Flores Incentive Percentage of the Incentive Payment Amount.

“Invested Amount” means the sum of (i) the Aggregate Consideration Amount (as defined in the Subscription Agreement) and (ii) the aggregate sales price of any equity securities issued by the Company after the Closing (including upon the exercise of any options).

“Target Value” means the value of the Company at which Allen has achieved an internal rate of return of 20% (after giving effect to any distributions he has received) on his investment in the Company, where “internal rate of return” means the annual percentage rate of return in which the sum of discounted cash inflows over the life of an investment is equal to the sum of the discounted cash outflows.

“Trued-up Amount” has the meaning set forth in Section 2(a) below.

“Valuation Event” means the first to occur of a Sale Transaction or a request pursuant to Section 2(b) below.

2. Management Incentive

(a) Unless Incentive Shares have previously been delivered pursuant to Section 2(b) below, immediately prior to the consummation of a Sale Transaction, in consideration of the value Flores shall have brought to the business of the Company, the Company shall deliver to Flores the Incentive Shares. In the event that at any time following consummation of such Sale Transaction, there shall be any reduction of the purchase price, or the Stockholders or the Company are required to make any indemnification or similar payment in respect of such Sale Transaction, then within five business days of such reduction or indemnification payment, Flores shall pay to each of Allen and, if applicable, Raymond, such amount as shall be necessary to ensure that the net amount that each Stockholder receives in respect of such Sale Transaction (after giving effect to any such reduction or indemnification payment) is equal to the amount such Stockholder would have received had the Incentive Payment Amount and Flores’s Incentive Shares been calculated based on an Equity Value equal to the original Equity Value less the amount of such reduction or indemnification payment (the “Trued-up Amount”), provided, however, that in no event shall Flores be required to pay an aggregate amount that would result in Flores receiving less than its Trued-up Amount.

(b) At any time after the earlier to occur of (i) January 1, 2015, and (ii) the date on which Allen and his Affiliates shall have Sold to third parties (other than any employee of Vulcan Inc. or any Subsidiary thereof), in one or more transactions, shares of Common Stock representing more than 50% of the outstanding shares of Common Stock if, after giving effect to the last of such sales, the Allen Ownership Percentage is less than 10% of the initial Allen Ownership Percentage, the Management Stockholders shall be entitled to

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jointly request a determination of the Equity Value of the Company in accordance with Section 2(c) below and, promptly following the determination of such Equity Value, in consideration of the value Flores shall have brought to the business of the Company, the Company shall deliver to Flores the Incentive Shares, if any; provided, however, that (i) in no event shall the Management Stockholders have the right to request such determination following the occurrence of any Sale Transaction and (ii) the Management Stockholders shall not have the right to request such determination more than once. The Management Stockholders shall make such request by providing written notice thereof to the Company, such notice to by signed by each Management Stockholder.

(c) If the Management Stockholders shall have requested a determination of the Equity Value pursuant to Section 2(b) above, the Equity Value shall be determined as follows:

(i) During the ten-day period following the date on which such determination is requested, the Management Stockholders, on the one hand, and Allen, on the other, shall each submit to the other such party’s respective proposal as to the Equity Value. If the higher proposal is not more than 10% higher than the lower proposal, then the Equity Value shall be equal to the average of such proposals.

(ii) In the event that one of the proposals contemplated under clause (i) above is more than 10% higher than the other proposal, then within ten Business Days after the submission of such proposals, the Management Stockholders, on the one hand, and Allen, on the other, shall jointly select and retain a managing director in an independent nationally recognized investment bank (the “Equity Value Appraiser”). In the event that such parties fail to jointly select the Appraiser within such period, then at the request of the Management Stockholders, on the one hand, or Allen, on the other hand, the American Arbitration Association shall provide them with a list of at least five Equity Value Appraiser candidates and each of the Management Stockholders, on the one hand, or Allen, on the other hand, shall be allowed to strike a number of names from the list and rank the remaining Equity Value Appraiser candidates in order of acceptance. The highest ranking Equity Value Appraiser candidate who remains on the list shall serve as the Appraiser. The Equity Value Appraiser shall be requested to make its determination within a period of 30 days after the deadline for submissions to be made by the Management Stockholders, on the one hand, or Allen, on the other hand, pursuant to Section 3(c)(iii), or as soon as practicable thereafter.

(iii) Within five Business Days of the appointment of the Appraiser, each of the Management Stockholders, on the one hand, and Allen, on the other hand, shall submit to the Equity Value Appraiser (A) its proposed determination of the Equity Value provided to the other party pursuant to Section 2(c)(i), (B) a list of factors that it believes to be relevant in the determination of the Equity Value, and (C) the reasons for that proposed value. In addition, each of the Management Stockholders, on the one hand, and Allen, on the other hand, shall at the same time deliver to the other a copy of any submission or information supplied by the Management Stockholders, on the one hand, or Allen, on the other hand, to the Equity Value Appraiser.

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(iv) The Equity Value Appraiser shall then make its own determination (having requested such further information from the Management Stockholders, Allen and/or the Company as it shall require) of the Equity Value.

(v) The Equity Value Appraiser shall certify to each of the Management Stockholders, Allen and the Company (A) that, having considered the respective submissions of the Management Stockholders, on the one hand, and Allen, on the other hand, it has made its own determination of the Equity Value according to the principles of this Agreement and (B) the proposed value of which of the Management Stockholders, on the one hand, or Allen, on the other hand, it determines to be closer to the Equity Value. The value proposed by the Management Stockholders, on the one hand, or Allen, on the other hand, so certified by the Equity Value Appraiser pursuant to clause (B) above shall thereupon be deemed to be the Equity Value for purposes of Section 2(b) above.

(vi) The fees and expenses of the Equity Value Appraiser shall be paid equally by the Management Stockholders, on the one hand, or Allen, on the other hand. The Equity Value Appraiser shall act as an expert and not as an arbitrator and its determination shall be final and binding upon the Management Stockholders, on the one hand, and Allen, on the other hand, in the absence of manifest error. The Equity Value Appraiser shall have no liability to any of the Management Stockholders, Allen or the Company in respect of its determination.

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EX-99.D6

EXHIBIT(d)(6)

Proposed Employment Agreement

for

Raymond

Summary of Key Terms

Overall Rationale: To secure the services of John Raymond (the “Executive”) as the President and Chief Executive Officer of Vulcan Energy Corporation (the “Company”).

1. Position/Duties: President and Chief Executive Officer of the Company. Duties would include managing the Company’s administrative and operational matters, and identifying and/or analyzing potential transactions in the mid-stream energy market. Executive would be required to devote an amount of his business time to the performance of duties hereunder consistent with his past practice, or such additional time as shall be necessary and appropriate in light of the needs of the Company.

2. Contract Term: Initial term commences on the Closing Date and ends on January 1, 2015. Commencing on January 1, 2015, and each anniversary thereof, his employment will automatically be extended for successive one-year periods unless either party provides notice not to extend at least 90 days prior to such anniversary.

3. Annual Cash Compensation: $300,000.

4. Equity Compensation:

a) Option Grant: Executive’s existing options with respect to Plains Resources, Inc. (“PLX”) shares would be cancelled without compensation. Executive would be granted an option (the “Option”) to purchase a number of shares of common stock of the Company such that the number of shares subject to the Option would equal five percent of the shares of common stock of the Company on a fully diluted basis (determined based on the treasury method) on the date of grant (after giving effect to the transaction). The Option would vest with respect to 90% of the shares covered by the Option on a schedule consistent with the remaining vesting schedule for the Executive’s existing options (without regard to any acceleration of vesting in connection with the transaction), and the per share exercise price of that portion of the Option would be such as to maintain the aggregate spread implicit in Executive’s existing options (based on the Merger Price, as defined in the Subscription Agreement). The Option would vest with respect to the remaining 10% of the shares covered by the Option in 10 equal annual installments, commencing on the first anniversary of the effective date of the Executive’s employment agreement with the Company, and the per share exercise price of that portion of the Option would be the Initial Share Price (as defined in the

Subscription Agreement). The Company would have the right to terminate the Option at any Call Closing, provided that the Company would be required to pay an amount equal to the difference between the aggregate exercise price of the Option with respect to the vested shares under the Option and the aggregate call price with respect to such vested shares under the Option. In addition, in the event of a drag-along event, the Company would have the right to reduce the number of shares subject to the Option pro-rata based on the percentage of Executive’s shares sold in such drag-along transaction, provided that the Company would be required to pay an amount equal to the difference between the aggregate exercise price of the Option with respect to the reduced shares under the Option and the aggregate drag-along price with respect to such reduced shares. The number of shares to be reduced would first be applied against any vested shares and then to any unvested shares.

b) Restricted Shares: Executive would contribute his shares of PLX (both vested and unvested) to the Company in exchange for shares of the Company. Any Company shares received in respect of any PLX restricted shares would be subject to the same restrictions and vesting schedule (without regard to any acceleration of vesting in connection with the transaction). In addition, Executive would be granted a number of additional shares of restricted stock equal to $2.5 million divided by a fraction, the numerator of which is the Aggregate Consideration Amount (as defined in the Subscription Agreement) and the denominator of which is 20 million. The additional restricted stock would vest in 10 equal annual installments, commencing on the first anniversary of the effective date of the Executive’s employment agreement with the Company.

c) Waiver of Acceleration: Executive would waive the acceleration of vesting with respect to any shares of restricted stock or options of PLX in connection with the transaction.

d) Incentive Vesting: If either (i) the aggregate distributions per common unit paid by MLP during any four consecutive calendar quarters is greater than or equal to $2.70 (subject to adjustment in the event of any adjustments to the Minimum Quarterly Distribution or Target Distribution levels under Section 6.6 of the MLP Agreement) or (ii) the Notional Equity Value of the Company exceeds 2.5 times the Initial Notional Equity Value of the Company, then the Option and all outstanding shares of restricted stock would vest in full. “Notional Equity Value” means, as of a particular date, an amount equal to (i) the Initial Multiple times the operating income less maintenance and capital expenditures (in each case, excluding Calumet Florida) of the Company for the immediately preceding four quarters, (ii) less the Company’s total debt outstanding as of such date. “Initial Notional Equity Value” means, as of a particular date, the Notional Equity Value as of the Closing Date, adjusted to reflect

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on a proforma basis any asset sales and equity issuances occurring after the Closing Date. “Initial Multiple” means a fraction, the numerator of which is the Aggregate Consideration Amount (as defined in the Subscription Agreement), plus the Company’s total debt outstanding immediately following the Closing, minus $20 million, and the denominator of which is the operating income less maintenance and capital expenditures (in each case, excluding Calumet Florida) of the Company on an annualized pro forma basis based on the last full fiscal quarter preceding the Closing.

e) Vesting upon Sale Transaction. The Option and restricted shares shall vest upon consummation of a Sale Transaction (as defined in the Stockholders’ Agreement).

5. Tax Loans: Upon the exercise of any Option following its acceleration as described under “Incentive Vesting”, or upon the vesting of any restricted share, at Executive’s request the Company would be obligated to lend to Executive the funds necessary for Executive to pay the federal income tax incurred by Executive with respect to such exercise or vesting, such loan to be on the terms set forth on Exhibit A. Notwithstanding the foregoing, the Company shall not be obligated to make any such loan if doing so would be prohibited under or would result in a breach or default under any third party credit agreement or instrument to which the Company or any of its Subsidiaries is a party; provided, that the Company shall use reasonable efforts to obtain a waiver or consent under any such agreement or instrument to make such loan.

6. Option Exercise Loans: Upon the acceleration of any Option as described under “Incentive Vesting”, at Executive’s request, the Company would be obligated to lend to Executive the funds necessary for Executive to pay the strike price with respect to any unexercised portion of the Option, such loan to be on the terms set forth on Exhibit B. Notwithstanding the foregoing, the Company shall not be obligated to make any such loan if doing so would be prohibited under or would result in a breach or default under any third party credit agreement or instrument to which the Company or any of its Subsidiaries is a party; provided, that the Company shall use reasonable efforts to obtain a waiver or consent under any such agreement or instrument to make such loan.

7. Management Incentive Payment: The employment agreement shall include the incentive payment provisions set forth on Schedule I hereto.

8. Other Benefits: Executive shall become eligible for benefits under the Company’s welfare benefit and qualified retirement plans when and if he loses eligibility for such plans with another employer. Executive shall be granted annual vacation consistent with past practice.

9. Expenses: Executive will be entitled to reimbursement for reasonable and necessary expenses in carrying out his duties.

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10. Payments upon Termination: Upon termination of Executive’s employment, Executive would be entitled to receive the following benefits:

(a) Termination upon Death, Disability, or Cause or other than for Good Reason: In the event the employment agreement terminates upon the Death or Disability of the Executive, or the Executive is terminated by the Company with Cause or he resigns for other than Good Reason, the Executive would not be entitled to any benefits other than any unpaid salary or pro rata share of any non-discretionary bonus amounts accrued through the effective date of such termination or resignation and any other vested benefits that have accrued through such date pursuant to the terms of the Company’s benefit plans and any benefits required by applicable law. All unvested options and restricted stock would lapse.

(b) Termination for Good Reason . In the event the Executive resigns for Good Reason, the Executive would be entitled to receive (i) on the termination date, an amount equal to one times the aggregate of his annual salary under the employment agreement and the bonus, if any, Executive received in the immediately preceding year, (ii) continuation of participation in the Company’s welfare benefit plans available to senior executive officers through the 18^th month following the date of termination, and (iii) all outstanding equity awards would vest in full, and the Company would provide all associated rights with respect thereto as contemplated herein, including the right to borrow the funds required to fund the exercise of any stock options and any amounts payable as a result of the income taxes incurred as a result of such exercise or vesting.

(c) Definitions:

(i) Disability. Executive shall have been absent from the performance of his duties with the Company for six consecutive months as a result of Executive’s incapacity due to physical or mental illness.

(ii) Cause. (A) Executive’s willful failure to perform duties reasonably assigned to him by the board of directors of the Company in accordance with the terms of the employment agreement, (B) Executive’s engaging in conduct which is demonstrably and materially injurious to the Company and its subsidiaries taken as a whole, (C) Executive’s having been convicted of, or entered a plea of nolo contendere to, burglary, larceny, murder or arson, or a felony involving deceit, fraud, perjury or embezzlement, or (D) Executive’s material breach of any term of his employment agreement, the Stockholders’ Agreement or the Exclusivity Agreement (other than the notification provisions thereof). The Company must provide Executive with written notice detailing such conduct (accompanied by a resolution of the Company’s board of directors finding such conduct) and provide Executive reasonable opportunity to cure.

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(iii) Good Reason. Without Executive’s written consent (A) material breach of any of the Company’s obligations under the employment agreement, (B) assignment by the Board to Executive of any duties that materially adversely alter the nature or status of Executive’s office, title or responsibilities, (C) the Company’s requiring Executive to relocate anywhere other than the greater Houston, Texas metropolitan area, except for required travel on Company business to an extent substantially consistent with Executive’s obligations under his employment agreement or (D) Alan’s material breach of either the Stockholders’ Agreement or the Exclusivity Agreement (other than the notification provisions thereof); provided, however, that notwithstanding the foregoing, neither (1) the transfer of the location of the Company’s principal administrative (for example, benefits) and/or financial functions (but not the position or title of President or Chief Executive Officer) to any site designated by the Board nor (2) the assignment or delegation of such functions or responsibilities by the Board to any person other than Executive, shall constitute Good Reason. The Executive must provide the Company with written notice detailing such conduct and provide the Company reasonable opportunity to cure.

11. Gross-Up Payment: For purposes of avoiding the “golden parachute” excise tax imposed under Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), the effectiveness of Executive’s employment agreement shall be subject to the approval of the shareholders of the Company in accordance with Section 280G(b)(5) of the Code and the regulations thereunder. If, regardless of such shareholder approval, Executive would become subject to the “golden parachute” excise tax, Executive would be entitled to the greater after-tax benefit of (i) the total amount of the benefits provided under his employment agreement or (ii) a reduced portion of such benefits such that no portion of his benefits would be subject to the “golden parachute” excise tax. Notwithstanding the foregoing, if Executive becomes subject to the “golden parachute” excise tax with respect to the Merger due to the acceleration of his equity awards upon a termination without Cause or for Good Reason, then he would be entitled to a gross-up payment with respect to such excise tax on the same basis as his existing gross-up at PLX.

12. Confidentiality/ Non-Competition/Non-Solicitation: Executive would be subject to certain confidentiality provisions, as well as non-competition and non-solicitation restrictions for a period of one (1) year following termination of employment with the Company, provided that the non-competition and non-solicitation restrictions would not apply if Executive is terminated without Cause or terminates his employment for Good Reason or upon termination of the employment agreement upon exercise of the right to terminate the automatic extensions in Section 2 above.

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13. Effect on Existing Employment Arrangements: Executive’s existing employment agreement would terminate at the closing, and all rights and obligations, including any right to any severance payment or benefit, would terminate. Executive’s existing options would be cancelled without compensation. Executive’s existing restricted shares and restricted units would be converted into restricted shares in the Company as provided in the Subscription Agreement.

14. Mitigation: Executive would not be required to mitigate if the event of his termination.

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Exhibit A

Tax Loan Terms

Each tax loan shall be evidenced by a promissory note with the following terms:

1. Term: Principal and accrued but unpaid interest due and payable on January 2, 2015.

2. Rate: The Applicable Federal Rate applicable to a loan with a maturity equal to the period of time between the issuance of the note and January 2, 2015.

3. Security: Principal and interest secured by a first lien on all shares of Common Stock held by Executive.

4. Recourse: Beyond value of collateral, non-recourse to Executive.

5. Acceleration: (i) Principal and interest accelerate in full upon the occurrence of a Sale Transaction (as defined in the Stockholders Agreement) and (ii) accelerates pro-rata as to principal and accrued interest upon the sale of any shares of Common Stock.

6. Interest Payments: Accrue quarterly on a PIK-basis.

7. Prepayment: Prepayable at any time without a pre-payment penalty.

8. Assignability: The Company may assign the note, the security interest and all related security documents.

9. Default at Maturity: In the event that Executive fails to pay any outstanding principal and interest at maturity (other than maturity in respect of an acceleration event), if the holder of the note does not elect to extend the maturity date, the holder shall be entitled to foreclose on a number of shares of Common Stock securing the note equal to the aggregate amount of unpaid principal and interest divided by the “Fair Market Value” of such shares, determined in accordance with Section 4.13(e) of the Stockholders Agreement.

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Exhibit B

Option Exercise Loan Terms

Each option exercise loan shall be evidenced by a promissory note with the following terms:

1. Term: Principal and accrued but unpaid interest due and payable upon the earlier of (i) January 2, 2015 and (ii) the occurrence of a Sale Transaction (as defined in the Stockholders Agreement).

2. Rate: The Applicable Federal Rate applicable to a loan with a maturity equal to the period of time between the issuance of the note and January 2, 2015.

3. Security: Principal and interest secured by a first lien on all shares of Common Stock issued upon exercise of Option.

4. Recourse: Beyond value of collateral, recourse to Executive in an amount equal to 25% of the original principal amount of loan and 25% of accrued interest.

5. Acceleration: Pro-rata as to principal and accrued interest upon the sale of any shares of Common Stock.

6. Interest Payments: Accrue quarterly on a PIK-basis.

7. Prepayment: Prepayable at any time without a pre-payment penalty.

8. Assignability: The Company may assign the note, the security interest and all related security documents.

9. Default at Maturity: In the event that Executive fails to pay any outstanding principal and interest at maturity (other than maturity in respect of an acceleration event), if the holder of the note does not elect to extend the maturity date, the holder shall be entitled to foreclose on a number of shares of Common Stock securing the note equal to the aggregate amount of unpaid principal and interest divided by the “Fair Market Value” of such shares, determined in accordance with Section 4.13(e) of the Stockholders Agreement.

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Schedule I

Raymond Incentive Provisions

1. Definitions

When used in this Schedule, the following terms shall have the meanings set forth below (all terms used in this Schedule that are not defined in this Section 1 shall have the meanings set forth elsewhere in this Schedule or, if not otherwise defined elsewhere in the Subscription Agreement, the meanings set forth in the Stockholders’ Agreement):

“Equity Value” means (i) if the Incentive Payment Amount is being determined with respect to a Sale Transaction, the aggregate net sales price of the equity of the Company in such Sale Transaction and/or, if such Sale Transaction results in proceeds to the Company, the aggregate net proceeds available for distribution to holders of shares of Common Stock after repayment of all indebtedness (including for the avoidance of doubt, any premium or prepayment or similar penalty) and other obligations of the Company and its Subsidiaries and the payment of all fees and expenses of the Company incurred in connection therewith and (ii) if the Incentive Payment Amount is being determined with respect to a request pursuant to Section 2(b) below, the aggregate value of the equity of the Company based on the fair market value in U.S. dollars of a share of Common Stock as of the date of the request giving rise to the determination of “Equity Value” which would reasonably be expected to be realized in an open market sale on arm’s length terms to a Person who is not an Affiliate of the seller or the buyer, having regard to all relevant factors, but without regard to (x) the availability or lack of availability of a market for such shares of Common Stock or (y) any minority discount that would otherwise be applicable to such shares of Common Stock, such “Equity Value” to be determined pursuant to Section 2(c) below.

“Raymond Incentive Percentage” means 100%; provided, however, that (i) if the Raymond Employment Agreement shall have been terminated as a result of death or disability, then the Raymond Incentive Percentage shall be equal to the product of 100% and a fraction, the numerator of which is the number of months during which the Raymond Employment Agreement was in effect (rounded up to the nearest whole month), and the denominator of which is 120, and (ii) if the Raymond Employment Agreement shall have been terminated by the Company for “Cause” (as defined therein) or by Raymond other than for “Good Reason” (as defined therein), then the Raymond Incentive Percentage shall be zero.

“Incentive Payment Amount” means (i) if the Equity Value at the time of the Valuation Event is less than or equal to the Target Value at the time of the Valuation Event, then the Incentive Payment Amount shall be zero, and (ii) if the Equity Value at the time of the Valuation Event is greater than the Target Value at the time of the Valuation Event, then the Incentive Payment Amount shall be an amount equal to the lesser of (x) 2.5% of the amount by which the Equity Value exceeds the Invested Amount and (y) one-half of the amount by which the Equity Value exceeds the Target Value.

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“Incentive Shares” means a number of shares of Common Stock with a value (based on the Equity Value at the time of the Valuation Event giving rise to the obligation to deliver such shares under Section 2 below) equal to the Raymond Incentive Percentage of the Incentive Payment Amount.

“Invested Amount” means the sum of (i) the Aggregate Consideration Amount (as defined in the Subscription Agreement) and (ii) the aggregate sales price of any equity securities issued by the Company after the Closing (including upon the exercise of any options).

“Target Value” means the value of the Company at which Alan has achieved an internal rate of return of 20% (after giving effect to any distributions he has received) on his investment in the Company, where “internal rate of return” means the annual percentage rate of return in which the sum of discounted cash inflows over the life of an investment is equal to the sum of the discounted cash outflows.

“Trued-up Amount” has the meaning set forth in Section 2(a) below.

“Valuation Event” means the first to occur of a Sale Transaction or a request pursuant to Section 2(b) below.

2. Management Incentive

(a) Unless Incentive Shares have previously been delivered pursuant to Section 2(b) below, immediately prior to the consummation of a Sale Transaction, in consideration of the value Raymond shall have brought to the business of the Company, the Company shall deliver to Raymond the Incentive Shares. In the event that at any time following consummation of such Sale Transaction, there shall be any reduction of the purchase price, or the Stockholders or the Company are required to make any indemnification or similar payment in respect of such Sale Transaction, then within five business days of such reduction or indemnification payment, Raymond shall pay to each of Alan and, if applicable, Foxtrot, such amount as shall be necessary to ensure that the net amount that each Stockholder receives in respect of such Sale Transaction (after giving effect to any such reduction or indemnification payment) is equal to the amount such Stockholder would have received had the Incentive Payment Amount and Raymond’s Incentive Shares been calculated based on an Equity Value equal to the original Equity Value less the amount of such reduction or indemnification payment (the “Trued-up Amount”), provided, however, that in no event shall Raymond be required to pay an aggregate amount that would result in Raymond receiving less than its Trued-up Amount.

(b) At any time after the earlier to occur of (i) January 1, 2015, and (ii) the date on which Alan and his Affiliates shall have Sold to third parties (other than any employee of Vulcan Inc. or any Subsidiary thereof), in one or more transactions, shares of Common Stock representing more than 50% of the outstanding shares of Common Stock if, after giving effect to the last of such sales, the Alan Ownership Percentage is less than 10% of the initial Alan Ownership Percentage, the Management Stockholders shall be entitled to

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jointly request a determination of the Equity Value of the Company in accordance with Section 2(c) below and, promptly following the determination of such Equity Value, in consideration of the value Raymond shall have brought to the business of the Company, the Company shall deliver to Raymond the Incentive Shares, if any; provided, however, that (i) in no event shall the Management Stockholders have the right to request such determination following the occurrence of any Sale Transaction and (ii) the Management Stockholders shall not have the right to request such determination more than once. The Management Stockholders shall make such request by providing written notice thereof to the Company, such notice to by signed by each Management Stockholder.

(c) If the Management Stockholders shall have requested a determination of the Equity Value pursuant to Section 2(b) above, the Equity Value shall be determined as follows:

(i) During the ten-day period following the date on which such determination is requested, the Management Stockholders, on the one hand, and Alan, on the other, shall each submit to the other such party’s respective proposal as to the Equity Value. If the higher proposal is not more than 10% higher than the lower proposal, then the Equity Value shall be equal to the average of such proposals.

(ii) In the event that one of the proposals contemplated under clause (i) above is more than 10% higher than the other proposal, then within ten Business Days after the submission of such proposals, the Management Stockholders, on the one hand, and Alan, on the other, shall jointly select and retain a managing director in an independent nationally recognized investment bank (the “Equity Value Appraiser”). In the event that such parties fail to jointly select the Appraiser within such period, then at the request of the Management Stockholders, on the one hand, or Alan, on the other hand, the American Arbitration Association shall provide them with a list of at least five Equity Value Appraiser candidates and each of the Management Stockholders, on the one hand, or Alan, on the other hand, shall be allowed to strike a number of names from the list and rank the remaining Equity Value Appraiser candidates in order of acceptance. The highest ranking Equity Value Appraiser candidate who remains on the list shall serve as the Appraiser. The Equity Value Appraiser shall be requested to make its determination within a period of 30 days after the deadline for submissions to be made by the Management Stockholders, on the one hand, or Alan, on the other hand, pursuant to Section 3(c)(iii), or as soon as practicable thereafter.

(iii) Within five Business Days of the appointment of the Appraiser, each of the Management Stockholders, on the one hand, and Alan, on the other hand, shall submit to the Equity Value Appraiser (A) its proposed determination of the Equity Value provided to the other party pursuant to Section 2(c)(i), (B) a list of factors that it believes to be relevant in the determination of the Equity Value, and (C) the reasons for that proposed value. In addition, each of the Management Stockholders, on the one hand, and Alan, on the other hand, shall at the same time deliver to the other a copy of any submission or information supplied by the Management Stockholders, on the one hand, or Alan, on the other hand, to the Equity Value Appraiser.

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(iv) The Equity Value Appraiser shall then make its own determination (having requested such further information from the Management Stockholders, Alan and/or the Company as it shall require) of the Equity Value.

(v) The Equity Value Appraiser shall certify to each of the Management Stockholders, Alan and the Company (A) that, having considered the respective submissions of the Management Stockholders, on the one hand, and Alan, on the other hand, it has made its own determination of the Equity Value according to the principles of this Agreement and (B) the proposed value of which of the Management Stockholders, on the one hand, or Alan, on the other hand, it determines to be closer to the Equity Value. The value proposed by the Management Stockholders, on the one hand, or Alan, on the other hand, so certified by the Equity Value Appraiser pursuant to clause (B) above shall thereupon be deemed to be the Equity Value for purposes of Section 2(b) above.

(vi) The fees and expenses of the Equity Value Appraiser shall be paid equally by the Management Stockholders, on the one hand, or Alan, on the other hand. The Equity Value Appraiser shall act as an expert and not as an arbitrator and its determination shall be final and binding upon the Management Stockholders, on the one hand, and Alan, on the other hand, in the absence of manifest error. The Equity Value Appraiser shall have no liability to any of the Management Stockholders, Alan or the Company in respect of its determination.

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