EXHIBIT 10.7 EXECUTION VERSION

Contribution Agreement

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Alon USA Energy, Inc. | T & R ASSETS, INC. | HOLLY ENERGY PARTNERS | FIN-TEX PIPE LINE COMPANY

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Title: EXHIBIT 10.7 EXECUTION VERSION
Governing Law: Texas Date: 5/11/2005
Law Firm: Vinson & Elkins L.L.P.

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EXHIBIT 10.7

EXECUTION VERSION

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CONTRIBUTION AGREEMENT

by and among

HOLLY ENERGY PARTNERS, L.P.

and

HOLLY ENERGY PARTNERS - OPERATING, L.P.

as Transferee Parties,

and

T & R ASSETS, INC.

FIN-TEX PIPE LINE COMPANY

ALON USA REFINING, INC.

as Transferors,

and

ALON PIPELINE ASSETS, LLC

ALON PIPELINE LOGISTICS, LLC

ALON USA, INC.

and

ALON USA, LP

Dated as of January 25, 2005

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TABLE OF CONTENTS

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Page

ARTICLE I

TRANSFER OF ASSETS, ASSUMPTION OF

LIABILITIES AND AGGREGATE CONSIDERATION

1.1 Contribution of Property and Assets..................................... 2

1.2 Excluded Assets......................................................... 5

1.3 Assumed Liabilities; Retained Liabilities............................... 6

1.4 Contribution to Newco 2................................................. 8

1.5 Contribution to Transferee.............................................. 8

1.6 Contributions to HEP Opco and Conversion of Newco 1..................... 8

1.7 Consideration........................................................... 9

1.8 Contribution to Partnership............................................. 9

ARTICLE II

CLOSING

2.1 Closing................................................................. 10

2.2 Deliveries by the Alon Parties.......................................... 10

2.3 Deliveries by Transferee................................................ 12

2.4 Casualty and Condemnation............................................... 12

2.5 Prorations.............................................................. 14

2.6 Closing Costs; Transfer Taxes and Fees.................................. 15

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE TRANSFEROR PARTIES

3.1 Organization............................................................ 15

3.2 Authorization........................................................... 16

3.3 No Conflicts or Violations; No Consents or Approvals Required........... 16

3.4 Compliance With Laws and Permits........................................ 17

3.5 Absence of Litigation................................................... 17

3.6 Operating Statements; Absence of Changes................................ 17

3.7 Title to Contributed Assets............................................. 18

3.8 Newco 1 and Newco 2..................................................... 19

3.9 Contracts............................................................... 20

3.10 Prohibited Persons Transactions......................................... 20

3.11 Intellectual Property................................................... 21

3.12 Software Products....................................................... 21

3.13 Taxes................................................................... 21

3.14 Sufficiency and Condition of Assets; Entire Operations................. 22

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HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

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3.15 Collective Bargaining Agreements; Labor Relations....................... 22

3.16 Employees; Employee Benefit Matters..................................... 22

3.17 Performance Of Pipelines; Performance of Terminals...................... 23

3.18 Insurance............................................................... 24

3.19 Status of Transferor Parties............................................ 24

3.20 Environmental Matters................................................... 24

3.21 Brokers and Finders..................................................... 25

3.22 Representations Relating to the Class B Units........................... 25

3.23 WAIVERS AND DISCLAIMERS................................................. 25

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF TRANSFEREE

4.1 Organization............................................................ 27

4.2 Authorization........................................................... 27

4.3 No Violations; No Consents or Approvals Required........................ 27

4.4 Absence of Litigation................................................... 28

4.5 Validity of Class B Units............................................... 28

4.6 Transferee Public Documents............................................. 28

4.7 Brokers and Finders..................................................... 29

ARTICLE V

COVENANTS

5.1 Conduct of the Operations............................................... 29

5.2 Access.................................................................. 30

5.3 Supplemental Operating Statements....................................... 30

5.4 Notification............................................................ 31

5.5 Injunctions............................................................. 31

5.6 Payments Received....................................................... 31

5.7 Rights.................................................................. 31

5.8 Insurance............................................................... 33

5.9 Cooperation............................................................. 33

5.10 Additional Agreements................................................... 33

5.11 HSR Matters............................................................. 34

5.12 Access to Financial Information......................................... 34

5.13 Bank Consents........................................................... 34

ARTICLE VI

EMPLOYMENT MATTERS

6.1 Offers of Employment.................................................... 35

6.2 Transferors' Employee Liabilities....................................... 36

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HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

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ARTICLE VII

CONDITIONS TO CLOSING

7.1 Conditions to Each Party's Obligation to Close.......................... 36

7.2 Conditions to Transferee's Obligation to Close.......................... 37

7.3 Conditions to the Alon Parties' and Newco 1's Obligation to Close....... 38

ARTICLE VIII

TERMINATION

8.1 Termination............................................................. 39

8.2 Effect of Termination................................................... 39

ARTICLE IX

INDEMNIFICATION

9.1 Obligations to Indemnify................................................ 40

9.2 Third Party Claims...................................................... 41

9.3 Direct Claims........................................................... 43

9.4 Dispute Resolution - Indemnification.................................... 44

9.5 Limits of Liability..................................................... 46

9.6 Survival of Covenants, Representations and Warranties................... 47

9.7 Exclusive Remedy........................................................ 47

9.8 Payments................................................................ 48

9.9 Administration of Indemnity Claims...................................... 48

ARTICLE X

INTERPRETATION; DEFINED TERMS

10.1 Interpretation.......................................................... 48

10.2 References, Gender, Number.............................................. 49

10.3 Defined Terms........................................................... 49

ARTICLE XI

ADDITIONAL AGREEMENTS

11.1 Access to Information................................................... 62

11.2 Public Announcements.................................................... 62

11.3 Confidentiality......................................................... 62

11.4 Notice of Certain Events................................................ 63

11.5 Further Assurances...................................................... 63

11.6 Post-Closing Tax Covenants.............................................. 63

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HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

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ARTICLE XII

MISCELLANEOUS

12.1 Expenses................................................................ 64

12.2 Notices................................................................. 64

12.3 Entire Agreement; Amendment; Waiver..................................... 65

12.4 Severability............................................................ 66

12.5 Parties in Interest..................................................... 66

12.6 Governing Law........................................................... 66

12.7 Assignment to Lenders; Assignment of Agreement to Subsidiary............ 66

12.8 No Waiver Relating to Claims for Fraud.................................. 67

12.9 Dispute Resolution - General............................................ 68

12.10 Captions 69

12.11 Counterparts............................................................ 69

12.12 Director and Officer Liability.......................................... 69

12.13 Specific Performance.................................................... 70

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EXHIBITS:

Exhibit A - Special Warranty Deed

Exhibit B - Pipeline Conveyance

Exhibit C - Bills of Sale

Exhibit D - Pipelines and Terminals Agreement

Exhibit E - Environmental Agreement

Exhibit F - Right of First Offer Agreement

Exhibit G - Assignment and Assumption Agreement

Exhibit H - Services Agreement

Exhibit I - Subordination, Non-Disturbance and Attornment Agreement

Exhibit J - Class B Amendment

Exhibit K - Mortgage and Deed of Trust

Exhibit L - Consent Agreement

ANNEXES:

Annex A-1 - Pipelines

Annex A-2 - Pipeline Maps

Annex A-3 - Pipeline Fee Land

Annex A-4 - Pipeline Leases

Annex A-5 - Pipeline Easements

Annex B-1 - Terminals

Annex B-2 - Terminal Fee Land

Annex B-3 - Terminal Leases

HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

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SCHEDULES:

Schedule 7.2(a) - Transferee Governmental Consents

Schedule 7.2(e) - Transferee Third Party Consents

Schedule 7.3(a) - Alon Governmental Consents

Schedule 7.3(e) - Alon Third Party Consents

HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

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CONTRIBUTION AGREEMENT

THIS CONTRIBUTION AGREEMENT (this "Agreement") dated as of January 25,

2005, is made and entered into by and among Holly Energy Partners, L.P., a

Delaware limited partnership ("Transferee"), Holly Energy Partners - Operating,

L.P., a Delaware limited partnership and a wholly-owned subsidiary of Transferee

("HEP Opco" and, together with Transferee, the "Transferee Parties"), T&R

Assets, Inc., a Texas corporation ("T&R"), Fin-Tex Pipe Line Company, a Texas

corporation ("Fin-Tex"), Alon USA Refining, Inc., a Delaware corporation ("Alon

Refining", and together with T&R and Fin-Tex, collectively, the "Transferors",

and each individually, a "Transferor"), Alon Pipeline Assets, LLC, a Texas

limited liability company ("Newco 1"), Alon Pipeline Logistics, LLC, a Delaware

limited liability company ("Newco 2", and together with the Transferors, the

"Transferor Parties"), Alon USA, Inc., a Delaware corporation and the parent of

the Transferors ("Alon USA"), and Alon USA, LP, a Texas limited partnership

("Alon LP", and together with the Transferor Parties and Alon USA, the "Alon

Parties").

WHEREAS, for the purpose of effecting the transactions contemplated by

this Agreement, the Transferors have formed Newco 1 and collectively directly

own all of the issued and outstanding equity interest therein (the "Newco 1

Equity Interests").

WHEREAS, for the purpose of effecting the transactions contemplated by

this Agreement, the Transferors have formed Newco 2 and collectively directly

own all of the issued and outstanding equity interest therein (the "Newco 2

Equity Interests").

WHEREAS, the Transferors wish to contribute to Newco 1, and Newco 1 wishes

to acquire from the Transferors (a) certain refined petroleum products

pipelines, (b) certain refined petroleum products terminals, and (c) certain

other specified rights and assets used primarily in connection with the

ownership and operation of the Pipelines (as defined herein) and the Terminals

(as defined herein), all on the terms and conditions of this Agreement.

WHEREAS, in connection with such contribution and acquisition Newco 1

shall assume certain liabilities and obligations of the Transferors as more

fully described herein, all on the terms and conditions of this Agreement.

WHEREAS, the Transferors wish to contribute to Newco 2 all of the Newco 1

Equity Interests; and

WHEREAS, Newco 2 wishes to contribute to Transferee, and Transferee wishes

to acquire from Newco 2, all of the Newco 1 Equity Interests.

NOW, THEREFORE, in consideration of the premises and the mutual covenants

and agreements contained herein, and other good and valuable consideration, the

receipt and sufficiency of which is hereby acknowledged, the parties hereto

hereby agree as follows:

HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

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ARTICLE I

TRANSFER OF ASSETS, ASSUMPTION OF

LIABILITIES AND AGGREGATE CONSIDERATION

1.1 CONTRIBUTION OF PROPERTY AND ASSETS. On the terms and subject to the

conditions set forth in this Agreement, at the Closing each Transferor shall

contribute, transfer, assign and deliver to Newco 1, as a capital contribution,

all of such Transferor's right, title and interest in and to the properties and

assets (other than the Excluded Assets) used primarily in connection with the

ownership and operation of the Pipelines and the Terminals (collectively, the

"Operations") (all of such assets, properties and rights are collectively

referred to as the "Contributed Assets"), including the following:

(a) All of the assets, properties and rights, whether real,

personal or mixed, which are owned or held for use by such Transferor primarily

in connection with the ownership or operation of the refined petroleum product

pipelines described in Annex A-1 (the "Pipelines") and the maps depicted in

Annex A-2, including the following (collectively, the "Pipeline Assets"):

(i) The parcels of fee simple real property described in

Annex A-3 (collectively, the "Pipeline Fee Land");

(ii) The lessee's interest in the leases described in Annex

A-4 (collectively, the "Pipeline Leases"), together with all the leasehold

estate described in the Pipeline Leases;

(iii) All easements, rights-of-way, property use agreements,

line rights and real property licenses and permits (including rights-of-way

permits from railroads and road crossing permits or other rights-of-way permits

from Governmental Entities) relating to the real property described in clauses

(i) and (ii) above, including those described in Annex A-5 (the "Pipeline

Easements"); and

(iv) All buildings, structures, fixtures, facilities,

improvements and appurtenances to the real property described in clauses (i),

(ii) and (iii) above (collectively, the "Pipeline Improvements"). The Pipeline

Improvements shall be treated as real property for all purposes of this

Agreement.

(b) All of the properties and assets, whether real, personal or

mixed, which are owned or held for use by such Transferor primarily in

connection with the ownership or operation of those certain refined petroleum

product terminals described in Annex B-1 (the "Terminals"), including the

following (collectively, the "Terminal Assets"):

(i) The parcels of fee simple real property described in

Annex B-2 (collectively, the "Terminal Fee Land");

HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

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(ii) The lessee's interest in the leases described in Annex

B-3 (collectively, the "Terminal Leases") together with all the leasehold estate

described in the Terminal Leases;

(iii) All easements, rights-of-way, property use agreements,

line rights and real property licenses and permits (including rights-of-way

permits from railroads and road crossing permits or other rights-of-way permits

from Governmental Entities) relating to the real property described in clauses

(i) and (ii) above, including those described in Annex B-2 or Annex B-3 (the

"Terminal Easements"); and

(iv) All buildings, structures, fixtures, facilities,

improvements and appurtenances to the real property described in clauses (i),

(ii) and (iii) above (collectively, the "Terminal Improvements"). The Terminal

Improvements shall be treated as real property for all purposes of this

Agreement.

or Terminal Improvements, all fittings, cathodic protection ground beds,

rectifiers, other cathodic or electric protection devices, machinery, engines,

pipes, pipelines, valves, valve boxes, connections, gates, scraper trap

extenders, telecommunication facilities and equipment (including microwave and

other transmission towers), lines, wires, computer hardware, fixed or mobile

machinery and equipment, vehicle refueling tanks, pumps, heating and

non-pipeline pumping stations, fittings, tools, furniture and metering equipment

(collectively, the "Equipment") that (i) are not by their nature consumed in the

ordinary course of business such that they constitute Supplies (as defined in

Section 1.1(e) below), (ii) are used, owned or leased by such Transferor as of

the Closing Date, (iii) are used in connection with the Operations, and (iv) in

the ordinary course of the Operations either (A) are permanently located on the

Real Property for use primarily in connection with the ownership and operation

of the Pipeline and Terminal Assets or the conduct of the Operations, or (B)

have historically been part of such Transferor's centralized or regional

maintenance operations for the Pipeline and Terminal Assets and have been

allocated by such Transferor to such assets for purposes of their divestiture.

All such items of Equipment (other than furnishings or office equipment) having

a net book value of $10,000 or more as of the close of the most recent fiscal

quarter ended at least one month prior to the date of this Agreement are

identified on Transferor Disclosure Schedule 1.1(c).

(d) All Rolling Stock listed on Transferor Disclosure Schedule

1.1(d).

(e) All inventories of spare parts intended to be consumed in the

ordinary course of the ownership and operation of the Pipeline and Terminal

Assets or the conduct of the Operations, maintenance, shop and office supplies,

and other similar items of tangible personal property on hand as of the Closing

and intended to be consumed in the ordinary course of the ownership and

operation of the Pipeline and Terminal Assets or the conduct of the Operations,

as well as chemicals or drag reducing agents, if any, on hand (the "Supplies").

(f) To the extent assignable, all permits, licenses, certificates,

authorizations, registrations, Orders, waivers, variances, exemptions,

franchises and approvals granted by any

HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

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Governmental Entity to such Transferor or its respective predecessors in

interest in connection with the Operations, including those set forth in Seller

Disclosure Schedule 1.1(f).

(g) Such records and documents relating to the ownership,

condition or operation of the Pipeline and Terminal Assets as the parties may

determine pursuant to Section 2.6(c) to be a part of the Pipeline and Terminal

Assets (the "Records"); provided, however, that such Transferor shall be

entitled to retain a copy of any Records and that the Records shall not include

any records or documents that are covered by the attorney-client privilege or

work product doctrine.

(h) Subject to Section 5.7, all rights under (i) Contracts and

other legally binding rights and obligations of such Transferor relating

primarily to the conduct of the Operations and set forth in Transferor

Disclosure Schedule 1.1(h) and (ii) Contracts relating primarily to the conduct

of the Operations and entered into by such Transferor after the date of this

Agreement in the ordinary course of business and in accordance with the terms

and conditions of this Agreement, but excluding those Contracts constituting

Leases or Easements (collectively, the "Assumed Contracts").

(i) The trademarks, trademark applications, trademark

registrations, trade names and service marks described in Transferor Disclosure

Schedule 1.1(i), together with the goodwill associated therewith and all rights

deriving therefrom (collectively, the "Trademarks").

(j) The registered copyrights or unregistered copyrights and all

rights deriving therefrom described in Transferor Disclosure Schedule 1.1(j)

(collectively, the "Copyrights").

(k) The patents, patent applications and other patent rights

described in Transferor Disclosure Schedule 1.1(k) (collectively, the

"Patents").

(l) The software (other than standard off-the-shelf software),

unpatented formulas, know-how, inventions, discoveries, trade secrets,

improvements, web sites, domain names and other technology described in

Transferor Disclosure Schedule 1.1(l) and all rights deriving therefrom

(together with the Trademarks, Copyrights and Patents, the "Intellectual

Property").

(m) All goodwill related to the Operations, if any.

(n) All rights under manufacturers' and vendors' warranties

relating to items included in the Operations and all rights against third

parties relating to items included in the Operations.

(o) Any and all other rights, titles and interests of such

Transferor in any and all other properties and assets (whether real, personal or

mixed, tangible or intangible), used or held for use primarily in connection

with the Operations.

HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

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1.2 EXCLUDED ASSETS. Notwithstanding anything to the contrary contained in

this Agreement, each Transferor shall retain all of its right, title and

interest in and to, and there shall be excluded from the contribution, transfer,

assignment and delivery of the Contributed Assets to Newco 1 hereunder, the

following assets and properties (collectively, the "Excluded Assets"):

(a) All rights under this Agreement and the Ancillary Documents.

(b) All cash, accounts receivable, pre-paid expenses, bank

accounts, cash equivalents and other similar types of investments, certificates

of deposit, U.S. Treasury bills and other marketable securities.

variations or derivations thereof, and (ii) any logo, service mark, copyright,

trade name or trademark of or associated with such Transferor or any of its

affiliates, not used or held for use primarily in connection with the

Operations.

(d) Tangible personal property located at the Real Property that

is (i) owned (or leased from third parties) by contractors or service providers

doing work or providing services at the Real Property or (ii) owned (or leased

from third parties) by employees of such Transferor.

(e) Improvements, fixtures, equipment and tangible personal

property located on any easement, right-of-way, lease, license or similar land

use right which encumbers the Real Property insofar as such improvements,

fixtures, equipment and tangible personal property are owned (or leased from

third parties) by the holder of such easement, right-of-way, lease, license or

similar land use right which encumbers the Real Property.

(f) Improvements, fixtures and items of equipment and tangible

personal property located on the Real Property insofar as such improvements,

fixtures, equipment and tangible personal property are owned (or leased from

third parties) by such Transferor or any affiliate thereof and are not used or

held for use primarily in connection with the Operations, including such of the

foregoing as are described in Transferor Disclosure Schedule 1.2(f).

(g) All crude oil, refined petroleum products or other petroleum

or petrochemical products.

(h) Any refund, rebate, credit or similar claim for Taxes paid by

such Transferor, whether known or unknown on the Closing Date, relating to the

Operations for any period or portion thereof ending prior to the Closing Date.

(i) Any refund, rebate, credit or similar claim relating to an

Excluded Asset or Retained Liability, whether known or unknown on the Closing

Date.

(j) All claims, causes of action, choses in action, rights of

recovery and rights of set off of any kind against any person arising out of or

relating to (i) the Operations for any period or portion thereof ending prior to

the Closing Date, (ii) any Excluded Asset, or (iii) any

HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

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Retained Liability; provided that to the extent that any of the foregoing arise

out of or relate to an Assumed Liability and are not otherwise expressly

identified as an Excluded Asset in this Section 1.2 (including in any Transferor

Disclosure Schedule relating to this Section 1.2), such shall not be an Excluded

Asset but shall rather be part of the Contributed Assets.

(k) Subject to Section 2.4 and Section 5.8, all rights under (i)

the insurance policies of such Transferor (including all claims and other rights

thereunder or relating thereto with respect to the Contributed Assets and the

Excluded Assets) and (ii) any premium returns or refunds or other amounts

associated with any tail policy, COBRA policy or other policy (whether in

existence on the date of this Agreement or hereafter purchased by such

Transferor) relating to the provision of COBRA benefits or other benefits to the

employees of such Transferor (or any subgroup thereof).

(l) Any other properties and assets (real, personal, mixed,

tangible or intangible) which are described in Transferor Disclosure Schedule

1.2(l).

1.3 ASSUMED LIABILITIES; RETAINED LIABILITIES.

(a) Assumed Liabilities. Subject to Section 1.3(b) and Section

2.5, at the Closing, each Transferor shall assign to Newco 1 and Newco 1 shall

assume and thereafter pay, perform and discharge when due the following

liabilities, obligations and commitments of such Transferor (collectively, the

"Assumed Liabilities"):

(i) all liabilities, obligations and commitments of such

Transferor accruing with respect to periods commencing on and after the

Effective Time under the Assumed Contracts, Leases and Easements and which

relate solely to the performance of the Assumed Contracts, Leases and Easements

after the Effective Time; and

(ii) except for liabilities, obligations and commitments

described in Section 1.3(a)(i), all other liabilities, obligations and

commitments occurring, arising out of or related to the ownership, use,

construction, maintenance or operation of the Contributed Assets on and after

the Effective Time, including all liabilities, obligations and commitments

incurred or imposed as a result of any event or occurrence (including any

injury, death or damage to person or property of a third party, or any claim for

repair, improvement, modification, replacement or maintenance of any Contributed

Asset) on or after the Effective Time to the extent arising out of or

attributable to the ownership or use of any portion of the Contributed Assets on

or after the Effective Time; provided that in no event shall the foregoing

include any liability, obligation, or commitment to the extent that in respect

thereof any Transferee Indemnified Party has the right to seek indemnification

from any Alon Party pursuant to Section 9.1(a)(ii), 9.1(a)(iii) or 9.1(a)(iv) of

this Agreement or the terms of the Environmental Agreement.

(b) Retained Liabilities. Subject to Section 2.5, Newco 1 does not

assume or agree to pay, honor, satisfy, discharge or perform, and shall not be

deemed by virtue of the execution and delivery of this Agreement or any

Ancillary Document or as a result of the consummation of the transactions

contemplated hereby or thereby, to have assumed, or to have

HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

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agreed to pay, honor, satisfy, discharge or perform, any liability of any

Transferor (other than the Assumed Liabilities), whether primary or secondary,

direct or indirect, known or unknown, fixed, accrued or contingent, existing

prior to the Effective Time (the "Retained Liabilities"), including the

following:

(i) any liability of any Transferor not specifically assumed

pursuant to Section 1.3(a);

(ii) any liability arising prior to the Effective Time out of

any breach by any Transferor of any provisions of any Assumed Contract,

including liabilities arising out of any Transferor's failure to perform any

Assumed Contract in accordance with its terms prior to the Effective Time;

(iii) any liability arising out of any breach by any

Transferor of any provisions of any Contract (other than an Assumed Contract and

other than as described in Section 1.3(b)(ii)), including liabilities arising

out of any Transferor's failure to perform any Contract (other than an Assumed

Contract and other than as described in Section 1.3(b)(ii)) in accordance with

its terms;

(iv) any liability of any Transferor under any Employee

Benefit Plan or Benefit Arrangement arising from the operation of such

Transferor's businesses; (v) any liability for any Taxes payable with respect to

the Contributed Assets or the Operations for any period or portion thereof

ending on or prior to the Closing Date;

(vi) any liability under or in connection with any Excluded

Assets;

(vii) any liability with respect to (A) any employees or any

collective bargaining representatives of any employees, agents or independent

contractors, in each case incurred while such person was employed by or

affiliated with any Transferor or any of its respective affiliates, whether or

not such employees, collective bargaining representatives, agents or independent

contractors are employed by or are affiliated with Newco 1 after the Effective

Time, (B) any Laws relating to plant closings, mass layoffs or employment

termination occurring at or prior to the Effective Time, (C) any liabilities

arising under or with respect to any collective bargaining agreement or Employee

Plans to which any Transferor or any of its respective affiliates is or was a

party prior to the Effective Time, (D) any liabilities arising at or prior to

the Effective Time for wages, salaries, severance (and notice thereof),

termination pay, vacation, individual or group life or health insurance,

property or personal injury claims or termination claims, and (E) any liability

arising on or prior to the Effective Time with respect to any employees of any

Transferor, applicants for employment with such Transferor or collective

bargaining agents arising from any unfair labor practice charges, charges of

employment discrimination, other federal and state administrative charges of any

kind, workers' compensation claims, arbitration awards, claims under the WARN

Act, claims for severance pay or other claims or causes of action of any kind;

HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

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(viii) any liability of any Transferor arising out of or

incurred in connection with the negotiation, preparation and execution of this

Agreement and the Ancillary Documents and the transactions contemplated hereby

and thereby and fees and expenses of any and all counsel, accountants and other

experts or advisers;

(ix) any intercompany liability between any Transferor and

any affiliate thereof;

(x) any liabilities retained by any Transferor under Section

6.2;

(xi) any accounts payable or other payables due and owing by

any Transferor;

(xii) any liability resulting from any Action, whether or not

pending or threatened prior to the Effective Time, arising out of or relating to

any other Retained Liability specified in this Section 1.3(b);

(xiii) any liability arising under any Contract that is not an

Assumed Contract; and

(xiv) any fines or penalties imposed on any Transferor as a

result of the Notice of Probable Violation disclosed on Transferor Disclosure

Schedule 3.4, Item 1.a.

contrary in this Section 1.3, the parties expressly acknowledge and agree that

this Section 1.3 shall not apply to Environmental Costs and Liabilities, which

shall be exclusively governed by the provisions of the Environmental Agreement.

1.4 CONTRIBUTION TO NEWCO 2. Effective as of immediately following the

contribution of the Contributed Assets to and the assumption of the Assumed

Liabilities by Newco 1 as required by Sections 1.1 and 1.3 hereof, each

Transferor shall contribute, transfer, assign and convey to Newco 2, as a

capital contribution, all of the Newco 1 Equity Interests held beneficially and

of record by such Transferor, free and clear of any Liens and Encumbrances.

1.5 CONTRIBUTION TO TRANSFEREE. Effective as of immediately following the

contribution of the Newco 1 Equity Interests to Newco 2 as required by Section

1.4 hereof and contemporaneously with the receipt by Newco 2 of the

consideration set forth in Section 1.7 hereof, Newco 2 shall, by virtue of this

Agreement and without any further action by any party, contribute, transfer,

assign and convey to Transferee, as a capital contribution, all of the Newco 1

Equity Interests, free and clear of any Liens and Encumbrances.

1.6 CONTRIBUTIONS TO HEP OPCO AND CONVERSION OF NEWCO 1.

(a) Immediately following the contribution of the Newco 1 Equity

Interests to Transferee as required by Section 1.5 hereof, Transferee shall

contribute, transfer, assign and convey to HEP Opco, as a capital contribution,

the Newco 1 Equity Interests.

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(b) Immediately following the contribution of the Newco 1 Equity

Interests to HEP Opco as required by Section 1.6(a) hereof, HEP Opco shall

contribute, transfer, assign and convey to HEP Pipeline, as a capital

contribution, a portion of the Newco 1 Equity Interests.

Interests to HEP Pipeline as required by Section 1.6(b) hereof, HEP shall cause

HEP Opco and HEP Pipeline to convert Newco 1 into a Texas limited partnership

with HEP Opco being the limited partner thereof and HEP Pipeline being the

general partner thereof.

1.7 CONSIDERATION.

(a) The aggregate consideration (the "Aggregate Consideration")

for the contribution of Newco 1 shall consist of (i) the Cash Consideration and

(ii) the Unit Consideration.

(b) The Closing Cash Consideration shall be paid by Transferee at

the Closing by wire transfer of immediately available funds to the account

specified by Newco 2 in writing at least three business days prior to the

Closing Date.

by delivery of the Certificates.

1.8 CONTRIBUTION TO PARTNERSHIP. It is the express intent of Transferee

and the Transferor Parties that the transactions contemplated by Section 1.5

hereof constitute a tax free contribution to a partnership under Section 721 of

the Code. The Transferor Parties and Transferee shall negotiate in good faith a

determination of the fair market value of each of the respective Contributed

Assets as soon as reasonably practicable following the date of this Agreement

and, in any event, no later than 60 days after the Closing. If the determination

is not agreed upon within 60 days after the Closing, then Transferee and the

Transferor Parties agree that the determination shall be made based upon an

asset valuation supplied by an independent accounting firm or appraiser, in

either case with substantial experience in valuing petroleum product pipelines

and terminals and mutually acceptable to Transferee and the Transferor Parties.

The cost of such appraisal shall be shared equally by Transferee and the

Transferor Parties. The appraisal, if required, shall be procured and provided

to Transferee and the Transferor Parties within 120 days after the Closing.

Transferee and the Transferor Parties agree that the determination of the fair

market value of the Contributed Assets pursuant to this Section 1.8 shall be

used for purposes of applying Section 704(c) of the Code to the Contributed

Assets, and that the variation between the fair market value of the Contributed

Assets and the adjusted tax basis of the Contributed Assets will be taken into

account under the "remedial method" as described in Treasury Regulation Section

1.704-3(d). Transferee and the Transferor Parties further agree that they shall

report the federal, state, municipal, local and other Tax consequences of the

contribution and acquisition hereunder in a manner consistent with this Section

1.8 and they shall not take any position inconsistent therewith in connection

with any Tax return, refund claim, litigation or otherwise. The parties hereby

acknowledge that none of the parties has made, or is making in this Agreement,

any representation to any other party concerning any of the Tax effects or

consequences of the transactions provided for in this Agreement and that each

party has obtained

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independent Tax advice with respect thereto and upon which it has solely relied;

provided that this sentence shall not limit the obligations of any party hereto

with respect to any covenants of such party expressly set forth herein or the

remedies of any party hereto with respect to a failure to comply with any such

covenants.

ARTICLE II

CLOSING

2.1 CLOSING. The closing of the transactions contemplated hereby (the

"Closing") shall be held at the offices of Vinson & Elkins L.L.P., 3700 Trammell

Crow Center, 2001 Ross Avenue, Dallas, Texas 75201 at 10:00 a.m. on the fifth

business day following the satisfaction or waiver of the conditions set forth in

Article VII (other than those conditions relating to execution of the Ancillary

Documents, which will be satisfied at the Closing), or such other place, time or

date as may be agreed upon by the parties; provided, however, that Transferee,

by means of prior notice to Transferors, shall have the right from time to time

to postpone the date for the Closing to such later date as may be specified in

such notice; and provided, further, that Transferee may not postpone such date

beyond the later of (i) February 28, 2005 or (ii) the first business day after

the date that the consents contemplated by Section 5.13 are actually obtained by

the Alon Parties. The date on which the Closing takes place is referred to

herein as the "Closing Date." The Closing shall be deemed to be effective as of

12:01 a.m. on the Closing Date (the "Effective Time").

2.2 DELIVERIES BY THE ALON PARTIES. At the Closing, the applicable Alon

Parties shall deliver, or cause to be delivered, to Transferee the following:

(a) A special warranty deed from each Transferor substantially in

the form of Exhibit A attached hereto (the "Special Warranty Deeds"), conveying

the Fee Land and all appurtenances thereto, including any Pipeline Improvements

or Terminal Improvements located on such Fee Land, as applicable, held by such

Transferor to Newco 1, subject only to Permitted Liens.

(b) A conveyance, assignment, bill of sale, and shared easement

agreement from each Transferor substantially in the form of Exhibit B attached

hereto (the "Pipeline Conveyance"), conveying all Real Property (other than the

Fee Land and all appurtenances thereto, including any Pipeline Improvements or

Terminal Improvements located on such Fee Land) held by such Transferor to Newco

1, subject only to Permitted Liens and the reservation of an easement for

Transferor for the operation and maintenance of a parallel pipeline with respect

to Easements designated as "Shared" on Annex A-5, as more specifically provided

therein.

substantially in the form of Exhibit C attached hereto (the "Bills of Sale"),

conveying to Newco 1 all of the Contributed Assets held by such Transferor

(other than the Real Property), subject only to Permitted Liens.

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(d) A counterpart of the pipelines and terminals agreement

substantially in the form attached as Exhibit D (the "Pipelines and Terminals

Agreement"), duly executed by Alon LP.

(e) A counterpart of the environmental agreement substantially in

the form attached as Exhibit E (the "Environmental Agreement"), duly executed by

each Alon Party listed as a signatory thereto.

(f) A counterpart of the right of first offer agreement

substantially in the form attached as Exhibit F (the "Right of First Offer

Agreement"), duly executed by Alon USA.

(g) A counterpart of the assignment and assumption agreement,

substantially in the form attached as Exhibit G (the "Assignment and Assumption

Agreement"), duly executed by each Transferor and Newco 1.

(h) All Consents required to be obtained by the Alon Parties

pursuant to Section 7.2(e).

(i) A counterpart of the services agreement, substantially in the

form attached as Exhibit H (the "Services Agreement"), duly executed by Alon LP.

(j) A certificate of non-foreign status substantially in the form

specified in Treasury Regulation 1.1445-2(b)(2)(iii) for each Transferor.

(k) A commitment for an TLTA Owner's Policy of Title Insurance for

each tract of Terminal Fee Land as set forth in Annex B-1, issued in the name of

Newco 1 at the Transferor Parties' cost and expense by the Title Company in the

amounts set forth on Transferor Disclosure Schedule 2.2(k) for each tract of

Terminal Fee Land, subject only to the standard printed exceptions set out on a

standard form Owner's Policy of Title Insurance issued by the Title Company and

the Permitted Liens applicable to each such tract of Terminal Fee Land, provided

that Transferee may at its sole cost and expense obtain any endorsements or

extended coverage which may be available, including but not limited to any

endorsement to delete survey exceptions or to provide coverage to any lender of

Transferee.

(l) The Alon Party Closing Certificate, duly executed by an

executive officer of each Transferor Party.

(m) A counterpart of the subordination, non-disturbance and

attornment agreement, substantially in the form attached as Exhibit I, with

Transferee's senior secured lenders at Closing, duly executed by Alon LP.

(n) An executed perpetual easement agreement for the benefit of

Transferee and its successors and assigns, granting an easement of at least 50

feet in width across Transferor's Hawley Terminal for operation and maintenance

of the Trust Pipelines crossing such terminal property, which easement agreement

shall include rights of ingress and egress as reasonably necessary for the

operation and maintenance of said Pipelines.

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(o) Such other documents in a form and substance reasonably

acceptable to Transferee that (i) are duly executed by each Transferor and

reflect the contribution, transfer, assignment and conveyance required by

Section 1.4 hereof and (ii) are duly executed by Newco 2 and reflect the

contribution, transfer, assumption and conveyance required by Section 1.5

hereof.

2.3 DELIVERIES BY TRANSFEREE. At the Closing, Transferee shall deliver, or

cause to be delivered, to Alon USA the following:

(a) After the receipt of the contribution required by Section 1.5

hereof, a counterpart of the Pipelines and Terminals Agreement, duly executed by

Transferee.

(b) After the receipt of the contribution required by Section 1.5

hereof, a counterpart of the Environmental Agreement, duly executed by

Transferee.

hereof, a counterpart of the Right of First Offer Agreement, duly executed by

Transferee.

(d) After the receipt of the contribution required by Section 1.5

hereof, a counterpart of the Services Agreement, duly executed by Transferee.

(e) An amendment to the Transferee Party Organizational Documents,

in substantially the form attached as Exhibit J (the "Class B Amendment").

(f) Certificates representing the Unit Consideration and issued in

the name of Newco 2 or its designee (the "Certificates").

(g) The Transferee Closing Certificate, duly executed by an

executive officer of Transferee.

(h) After the receipt of the contribution required by Section 1.5

hereof, a counterpart of the mortgage and deed of trust, substantially in the

form attached as Exhibit K, duly executed by Newco 1.

(i) A counterpart of the documents effecting the contribution

required by Section 1.6(b) hereof and the conversion of Newco 1 into a limited

partnership as required by Section 1.6(b) hereof.

2.4 CASUALTY AND CONDEMNATION.

(a) Material Casualty. Transferors shall notify Transferee in

writing on the next business day, and in no event later than 24 hours, if, after

the date of this Agreement and prior to the Closing, all or any part of a

Pipeline and Terminal Asset is damaged or destroyed by fire or other casualty

and such damage or destruction, individually or in the aggregate, constitutes a

Material Damage or Condemnation. Transferee shall have the option, exercisable

within ten days after receipt of such written notice from Transferors (but

before Closing), to elect

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by written notice to Transferors to terminate this Agreement; provided, however,

that such election by Transferee to terminate this Agreement shall not be

effective if:

(i) such damaged or destroyed Pipeline and Terminal Asset

can be repaired or replaced to the state in which such asset existed immediately

preceding such damage or destruction within 120 days from the date of

Transferors' receipt of Transferee's notice of termination; and

(ii) within ten days after Transferors' receipt of

Transferee's notice of termination, Transferors give Transferee written notice

of Transferors' election to repair or replace such damaged or destroyed Pipeline

and Terminal Asset at Transferors' sole expense (including any insurance

proceeds attributable thereto under insurance policies of Transferors or any of

their respective affiliates).

If Transferors elect to repair or replace such damaged Pipeline and Terminal

Asset pursuant to the foregoing, Transferors shall be obligated to proceed in

good faith to diligently repair or replace such damaged or destroyed Pipeline

and Terminal Asset to the state in which such asset existed immediately

preceding such damage or destruction and the Closing Date shall be extended

until the third business day following the date on which Transferors and

Transferee mutually agree that such damaged Pipeline and Terminal Asset has been

so repaired or replaced, such mutual agreement not to be unreasonably withheld,

conditioned or delayed; provided, however, this Agreement shall terminate, at

Transferee's option, if such damaged asset is not so repaired or replaced by the

earlier of (x) 120 days from the date of Transferor's receipt of Transferee's

aforesaid notice of termination or (y) the Termination Date.

(b) Material Condemnation. Transferors shall notify Transferee in

writing on the next business day, and in no event later than 24 hours, if, after

the date of this Agreement and prior to the Closing, all or any part of a

Pipeline and Terminal Asset is taken in condemnation or if proceedings for such

purpose shall be pending, and such taking, individually or in the aggregate,

constitutes or would constitute a Material Damage or Condemnation. Transferee

shall have the option, exercisable within ten days following receipt of such

written notice from Transferors (but before Closing), to elect by written notice

to Transferors to terminate this Agreement.

Agreement and prior to the Closing:

(i) all or any part of a Pipeline and Terminal Asset shall

be damaged or destroyed by fire or other casualty and either (A) such damage or

destruction does not, individually or in the aggregate, constitute a Material

Damage or Condemnation or (B) Transferee does not elect to terminate this

Agreement pursuant to Section 2.4(a); or

(ii) all or any part of a Pipeline and Terminal Asset shall

be taken in condemnation or under the right of eminent domain or if proceedings

for such purposes shall be pending and either (A) such taking does not,

individually or in the aggregate, constitute a

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Material Damage or Condemnation or (B) Transferee does not elect to terminate

this Agreement pursuant to Section 2.4(b);

then this Agreement shall remain in full force and effect notwithstanding any

such damage, destruction, taking or proceeding or the threat thereof.

(d) Insurance Proceeds, Condemnation Awards or Other Proceeds. To

the extent insurance proceeds (excluding any insurance proceeds payable through

self-insurance programs of Transferors or their respective affiliates),

condemnation awards or other payments are not committed, used or applied by

Transferors prior to the Closing Date to repair, restore or replace such

damaged, destroyed or taken Pipeline and Terminal Asset, Transferors shall at

the Closing (i) assign to Transferee Transferors' rights to receive all

insurance or condemnation proceeds, awards or payments (excluding any insurance

proceeds payable through self-insurance programs of Transferors or their

respective affiliates) owed to Transferors in respect of such Pipeline and

Terminal Asset by reason of such damage, destruction or taking, less any

reasonable costs and expenses incurred by Transferors in collecting same or in

connection with such proceedings or the threat thereof, and (ii) pay to

Transferee all insurance or condemnation proceeds, awards or payments (excluding

any insurance proceeds payable through self-insurance programs of Transferors or

their respective affiliates) theretofore paid to Transferors in respect of such

Pipeline and Terminal Asset by reason of such damage, destruction or taking,

less any reasonable costs and expenses incurred by Transferors in collecting

same or in connection with such proceedings or the threat thereof. Further, to

the extent Transferors do not repair, restore or replace any such damaged or

destroyed Pipeline and Terminal Asset at least substantially to the condition in

which such asset existed prior to such damage or destruction (taking into

account the age of any individual asset and its use, if any, in the Operations

immediately prior to such damage or destruction), and any insurance proceeds

paid to Transferee pursuant to Section 2.4(c) are insufficient to cover the

diminution in value of such damaged or destroyed Pipeline and Terminal Asset

resulting from such damage or destruction and Transferors' failure to repair,

restore or replace the same as provided above, then the Cash Consideration shall

be reduced by the amount of such deficiency as shall be mutually agreed by

Transferee and Transferors in good faith (such amount, the "Deficiency Amount").

2.5 PRORATIONS. On the Closing Date, or as promptly as practicable

following the Closing Date, but in no event later than 60 calendar days

thereafter, the real and personal property Taxes, water, gas, electricity and

other utilities, local business or other license fees to the extent assigned and

other similar periodic charges payable with respect to the Contributed Assets

shall be prorated between Transferee, on the one hand, and Transferors, on the

other hand, effective as of the Effective Time with Transferors being

responsible for amounts related to the period prior to but excluding the

Effective Time and Transferee being responsible for amounts related to the

period at and after the Effective Time. The Parties shall take all actions

necessary to cause utility meter readings to be determined as of the Effective

Time or as close thereto as reasonably practicable. If the final real property

Tax rate or final assessed value for the current Tax year is not established by

the Closing Date, the prorations shall be made on the basis of the rate or

assessed value in effect for the preceding Tax year and shall be adjusted when

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the exact amounts are determined. All such prorations shall be based upon the

most recent available assessed value available prior to the Closing Date.

2.6 CLOSING COSTS; TRANSFER TAXES AND FEES.

(a) Allocation of Costs. Transferee shall pay the cost of all

sales, transfer and use Taxes arising out of the transfer of the Contributed

Assets pursuant to this Agreement and, subject to Section 2.2(k), all costs and

expenses (including recording fees and real estate transfer Taxes and real

estate transfer stamps) incurred in connection with obtaining or recording title

to the Contributed Assets. The sales, use and transfer Tax returns required by

reason of said transfer shall be timely prepared and filed by the party normally

obligated by Law or regulation to make such filing. Transferors and Transferee

agree to cooperate with each other in connection with the preparation and filing

of such returns, in obtaining all available exemptions from such sales, use and

transfer Taxes, and in timely providing each other with resale certificates and

any other documents necessary to satisfy any such exemptions.

(b) Reimbursement. If Transferee, on the one hand, or any

Transferor, on the other hand, pays any Tax agreed to be borne by the other

party under this Agreement, such other party shall promptly (within five

business days) reimburse the paying party for the amounts so paid. If any party

receives any Tax refund or credit applicable to a Tax paid by another party

hereunder, the receiving party shall promptly (within five business days) pay

such amounts to the party entitled thereto.

Transferors shall identify those records and documents that shall constitute a

part of the Records. On or before the 60th day following the Closing,

Transferors shall provide originals of the applicable records and documents to

Transferee to the extent Transferors or their respective affiliates have such

originals in their possession. Transferors shall deliver any records and

documents that constitute a part of the Records that are discovered by

Transferors to be in their possession or the possession of any of their

respective affiliates after the date on which the Records are delivered to

Transferee pursuant to the provisions hereof.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE TRANSFEROR PARTIES

The Alon Parties, jointly and severally, hereby represent and warrant to

Transferee as follows:

3.1 ORGANIZATION. Each Alon Party and Newco 1 is an entity duly organized,

validly existing and in good standing under the laws of its state of

organization and has the requisite power to own, lease and operate its

properties and assets and to carry on its business as now being conducted. Each

Alon Party and Newco 1 is duly qualified to do business and in good standing as

a foreign entity in each of the states in which it has assets or conducts

activities which require it to be so qualified or in good standing, except where

the failure to be so qualified or in good standing could not reasonably be

expected to have a Material Adverse Effect. The Alon Parties have furnished to

Transferee a true, correct and complete copy of the organizational

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documents for each Alon Party and Newco 1 (collectively, the "Alon Party

Organizational Documents"). The Alon Party Organizational Documents are in full

force and effect and constitute all of the organizational and governing

documents for each Alon Party and Newco 1. There are no proceedings or actions

pending or contemplated to dissolve any Alon Party or Newco 1.

3.2 AUTHORIZATION. Each Alon Party and Newco 1 has full power and

authority to (a) execute and deliver this Agreement and the Alon Ancillary

Documents to be executed and delivered by such Alon Party or Newco 1 and (b)

consummate the transactions contemplated hereby and thereby. Each Alon Party and

Newco 1 has taken all action required by its applicable Alon Party

Organizational Documents to authorize (i) the execution, delivery and

performance of this Agreement and the applicable Alon Ancillary Documents and

(ii) the consummation of the transactions contemplated hereby and thereby. This

Agreement has been duly and validly executed and delivered by each Alon Party

and Newco 1 and is a legal, valid and binding obligation of such Alon Party or

Newco 1, enforceable against such Alon Party or Newco 1 in accordance with its

terms, except as enforcement may be limited by applicable bankruptcy,

insolvency, reorganization, moratorium, fraudulent conveyance or other similar

Laws now or hereafter in effect relating to creditors' rights generally and

general principles of equity (regardless of whether enforceability is considered

in a proceeding at law or in equity). All Alon Ancillary Documents to be

executed and delivered by each Alon Party and Newco 1 shall, on the Closing

Date, be duly and validly executed by each Alon Party and Newco 1, as

applicable, and be legal, valid and binding obligations of such Alon Party and

Newco 1, enforceable against such Alon Party and Newco 1 in accordance with

their respective terms, except as enforcement may be limited by applicable

bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or

other similar Laws now or hereafter in effect relating to creditors' rights

generally and general principles of equity (regardless of whether enforceability

is considered in a proceeding at law or in equity).

3.3 NO CONFLICTS OR VIOLATIONS; NO CONSENTS OR APPROVALS REQUIRED. Except

as set forth in Transferor Disclosure Schedule 3.3, the execution, delivery and

performance by each Alon Party and Newco 1 of this Agreement and the other Alon

Ancillary Documents to which such Alon Party or Newco 1 is a party do not, and

the consummation of the transactions contemplated hereby and thereby will not,

(a) violate, conflict with, or result in any breach of any provision of the Alon

Organizational Documents, (b) violate, conflict with or result in a violation or

breach of, or constitute a default (with or without due notice or lapse of time

or both) under, any of the material terms, conditions or provisions of any

Material Contract, or (c) subject to obtaining the Consents or making the

registrations, declarations or filings set forth in the next sentence, violate

in any material respect any applicable Law binding upon any Alon Party or Newco

1 or the Pipeline and Terminal Assets or the Operations. No Consent of any

Governmental Entity or any other person is required for any Alon Party or Newco

1 in connection with the execution, delivery and performance of this Agreement

and the Alon Ancillary Documents to which such Alon Party or Newco 1 is a party

or the consummation of the transactions contemplated hereby or thereby, except

as set forth in Transferor Disclosure Schedule 3.3 and except for (i)

requirements under the HSR Act, (ii) Environmental Permits and (iii)

Post-Closing Consents.

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3.4 COMPLIANCE WITH LAWS AND PERMITS. Except as set forth on Transferor

Disclosure Schedule 3.4, (a) Transferors hold, and upon the contributions by the

Transferors, Newco 1 will hold, all permits, licenses, variances, exemptions,

orders, franchises and approvals of all Governmental Entities necessary for the

lawful ownership or material to the operation of the Pipeline and Terminal

Assets and the conduct of the Operations (the "Permits") and (b) the Operations

comply with, and the Transferors and their respective affiliates have owned and

operated the Pipeline and Terminal Assets and conducted the Operations in

material compliance with, all applicable Laws and Permits. Except as set forth

on Transferor Disclosure Schedule 3.4, no investigation or review by any

Governmental Entity with respect to any Transferor or any of its affiliates and

relating to the Pipeline and Terminal Assets or the Operations is pending or, to

the knowledge of the Alon Parties, threatened which, if resolved adversely to

such Transferor or any of its affiliates, could reasonably be expected to have a

Material Adverse Effect. For purposes of this Section 3.4, the term "applicable

Laws," as used in clause (a) above, shall not include any Environmental Laws or

the subject matter of Section 3.20.

3.5 ABSENCE OF LITIGATION. Except as set forth on Transferor Disclosure

Schedule 3.5, there is no Action pending or, to the knowledge of the Alon

Parties, threatened against any Transferor or any its affiliates by or before

any arbitrator or Governmental Entity and relating to or against the Pipeline

and Terminal Assets or the Operations or challenging the transactions

contemplated hereby, nor are there any reviews or investigations relating to any

Transferor or any of its affiliates and the Pipeline and Terminal Assets or the

Operations pending or, to the knowledge of the Alon Parties, threatened by or

before any arbitrator or any Governmental Entity.

3.6 OPERATING STATEMENTS; ABSENCE OF CHANGES.

(a) Operating Statements. Transferors have provided to Transferee

true, correct and complete copies of statements of operating expenses and

throughput volumes for the operations of the Pipeline and Terminal Assets for

the twelve months ended December 31, 2004, 2003 and 2002, and property and

equipment ledgers, including Tax basis and Tax depreciation information, for the

Contributed Assets which ledgers are in substantially the form maintained by

Transferors or their respective affiliates in the ordinary course of business

(collectively, the "Operating Statements"). The Operating Statements (i) are

consistent in all material respects with the books and records of Transferors or

their respective affiliates relating to the conduct of the Operations, (ii)

reflect in all material respects on an accrual basis expenses for the periods

indicated that were incurred in the operation of the Pipelines and the Terminal

Assets, (iii) were prepared by management of Transferors or their respective

affiliates in good faith and based upon reasonable judgments and assumptions and

(iv) do not include or relate to any assets other than the Contributed Assets.

Transferors do not maintain any financial statements specific to the Contributed

Assets other than internally prepared monthly balance sheets and statements of

income for management control areas consisting of individual pipeline systems

and terminals.

(b) Absence of Changes. Since December 31, 2004, (i) Transferors

and their respective affiliates have operated the Pipeline and Terminal Assets

and conducted the Operations in the ordinary course of business consistent with

past practice, (ii) Transferors and their respective affiliates have not

incurred or suffered any change, circumstance, result, effect,

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event or fact, which has had or could reasonably be expected to have a material

adverse change on the Operations and (iii) there has not occurred, and

Transferors and their respective affiliates have not incurred or suffered, any

change, circumstance, result, effect, event or fact that could reasonably be

expected to have a Material Adverse Effect.

Disclosure Schedule 3.6(c), from and after December 31, 2004, nothing has

occurred that would have violated the terms of Sections 5.1(d), 5.1(i), 5.1(l)

and 5.1(m) hereof if the terms thereof had been in effect from and after

December 31, 2004.

3.7 TITLE TO CONTRIBUTED ASSETS.

(a) Except as set forth on Transferor Disclosure Schedule 3.7(a),

Transferors have, and at the Closing Newco 1 shall receive and own, good and

marketable title to the Fee Land and all of the Contributed Assets that

constitute personal property and good and indefeasible title to or valid

leasehold interests in all of the other Contributed Assets, in each case free

and clear of any Liens, other than Permitted Liens.

(b) Each tract of Fee Land is owned in fee simple by the

applicable Transferor, subject only to the Permitted Liens, and except as set

forth on Transferor Disclosure Schedule 3.7(b), none of the Fee Land is subject

to any lease or other possessory interest of any person other than the

applicable Transferor. Except for the Leases, and except as described in

Transferor Disclosure Schedule 3.7(b), Transferors do not lease any parcels,

tracts of land, buildings, fixtures or improvements that are used or held for

use primarily in connection with the Operations.

the Real Property constitutes all the parcels, tracts of land, buildings,

fixtures and improvements that are used or held for use primarily in connection

with the Operations.

(d) Except as set forth in Transferor Disclosure Schedule 3.7(d),

(i) other than Transferors, there are no parties in possession of any portion of

the Real Property as lessees, subtenants or tenants at sufferance or

trespassers; (ii) there is no pending, or to the knowledge of the Alon Parties,

threatened condemnation, eminent domain or similar proceeding or special

assessment affecting the Real Property, and (iii) to the knowledge of the Alon

Parties, (A) there is no pending Action to modify or terminate the present

zoning of the Real Property or any aspect thereof, and (B) certificates of

occupancy and all other Permits, and any requisite certificates of the local

board of fire underwriters (or other body exercising similar functions), have

been issued, if required by any Governmental Entity, for each of the

Improvements located on the Real Property and all such Permits have been paid

for and are in full force and effect. Except as set forth on Transferor

Disclosure Schedule 3.7(d), no commitments have been made to any Governmental

Entity, utility company, school board, church or other religious body or any

homeowners or homeowners' association, or any other organization, group or

individual, relating to the Real Property that would impose an obligation on

Transferee, its affiliates or their respective successors or assigns to make any

contribution or dedications of money or land or to construct, install or

maintain any improvements of a public or private nature on or off of the Real

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Property. Except as set forth on Transferor Disclosure Schedule 3.7(d), since

December 31, 2004 the Improvements have been maintained in accordance with

historical practices (but in no event at less than prudent industry standards

and practices), other than deferred maintenance projects set forth on Transferor

Disclosure Schedule 3.7(d) or deferred maintenance projects that, individually

or in the aggregate, do not exceed $50,000. To the knowledge of the Alon

Parties, the compliance in all respects of the Real Property and all aspects

thereof with all applicable zoning and similar Laws does not depend on, and no

Operating Permit for such real property depends on, any other real property or

other rights appurtenant thereto.

(e) Each parcel of Real Property is adequately serviced by all

public utilities and services, including electricity, water, sewage and

telecommunications, to the extent necessary to continue the operation of the

Contributed Assets located thereon consistent with operation by the applicable

Transferor prior to the date of this Agreement.

(f) Except as provided in Transferor Disclosure Schedule 3.7(f),

(i) neither any Alon Party nor Newco 1 is a party to any Contract regarding the

sale, conveyance, transfer, lease or disposition of any portion of the Real

Property (except for this Agreement or as contemplated hereby); (ii) there has

not been granted to any person and no person possesses, any option to purchase

or right of first refusal to purchase any portion of the Real Property; and

(iii) neither any Alon Party nor Newco 1 is a party to any occupancy Contract,

lease or similar arrangement with respect to any portion of the Real Property.

(g) Except as set forth in Transferor Disclosure Schedule 3.7(g),

(i) no Transferor is in material default under any Easement or Lease to which it

is a party, nor to the knowledge of the Alon Parties, is there any event or

circumstance that solely with the giving of notice or the lapse of time or both

would constitute a material default under any such Easement or Lease, (ii) there

are no easement gaps in the "Trust Pipeline" or the "River Pipeline," and to the

knowledge of the Alon Parties, the "Fin-Tex Pipeline" and (iii) the Easements

are in full force and effect and are sufficient to allow the applicable

Transferor and Newco 1 to continue to operate the Pipelines therein or thereon

(without interruption) as currently operated. All Pipelines are located fully

within the land constituting or encumbered by the Pipeline Easements. All

Easements and Leases represent valid, binding and enforceable agreements of the

applicable Transferor and, to the knowledge of the Alon Parties, each of the

parties thereto and there is no pending modification or cancellation of same.

(h) The applicable Transferor has a valid and subsisting leasehold

estate in and the right to quiet enjoyment of the real property leased to it

under the Pipeline Leases and Terminal Leases for the full term thereof, subject

to the Permitted Liens.

3.8 NEWCO 1 AND NEWCO 2.

(a) As of the date of this Agreement and as of immediately prior

to the Closing, all of the issued and outstanding Newco 1 Equity Interests and

Newco 2 Equity Interests are owned by the Transferors, free and clear of all

Liens or Encumbrances and such Newco 1 Equity Interests shall constitute all of

the issued and outstanding equity interests of Newco 1.

HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

<PAGE>

(b) Immediately following the contribution required by Section 1.4

hereof, Newco 2 shall receive legal and beneficial title to all of the issued

and outstanding Newco 1 Equity Interests, free and clear of all Liens and

Encumbrances.

hereof, Transferee shall receive legal and beneficial title to all of the issued

and outstanding Newco 1 Equity Interests, free and clear of all Liens and

Encumbrances.

(d) Newco 1 has conducted no business or activity and has no

assets or liabilities other than its liabilities and obligations under this

Agreement, and as of the Closing Newco 1 shall have no assets or liabilities

other than the Contributed Assets, Assumed Liabilities and the liabilities and

obligations under this Agreement which it shall hold immediately following the

contribution required by Sections 1.1, 1.2 and 1.3 hereof.

3.9 CONTRACTS.

(a) True, correct and complete copies of all Assumed

Contracts have been delivered to Transferee. Except as disclosed in Transferor

Disclosure Schedule 3.9(a), (i) each Assumed Contract is in full force and

effect and constitutes a valid and binding agreement, enforceable in accordance

with its terms, of the applicable Transferor and, to the knowledge of the Alon

Parties, each other party thereto, (ii) neither the applicable Transferor nor

any of its affiliates is in breach of or default, in any material respect, under

any Assumed Contract involving or relating to any of the Pipeline and Terminal

Assets, and (iii) to the knowledge of the Alon Parties, there does not exist

under any provision of any Assumed Contract any event that, with the giving of

notice or the lapse of time or both, would constitute such a breach or default

by the applicable Transferor or any of its affiliates under such contract.

Except as disclosed in Transferor Disclosure Schedule 3.9(a), no other party to

any Assumed Contract is, to the knowledge of the Alon Parties, in breach of or

default under such Assumed Contract in any material respect. No Alon Party nor

any affiliate thereof has received any notice from any other party to any

Assumed Contract that alleges any violation, breach or default by any Transferor

of any Assumed Contract in any material respect.

(b) Assuming the Consents set forth on Transferor Disclosure

Schedule 3.3 are obtained prior to Closing, each Assumed Contract shall not be

cancelable by the other party due to the consummation of the transactions

contemplated hereby.

3.10 PROHIBITED PERSONS TRANSACTIONS. Each Alon Party and Newco 1 is

currently in compliance with, and shall at all times during the term of this

Agreement (including any extension thereof) remain in compliance with, the

regulations of the Office of Foreign Asset Control ("OFAC") of the Department of

the Treasury (including those named on OFAC's Specially Designated and Blocked

Persons List) and any statute, executive order (including the September 24,

2001, Executive Order Blocking Property and Prohibiting Transactions with

Persons Who Commit, Threaten to Commit, or Support Terrorism), or other

governmental action relating thereto.

HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

<PAGE>

3.11 INTELLECTUAL PROPERTY. All Intellectual Property used or held for use

primarily in connection with the Operations is listed in Transferor Disclosure

Schedules 1.1(i), 1.1(j), 1.1(k) and 1.1(l). Transferors own or hold pursuant to

valid licenses to use such Intellectual Property free and clear of all Liens,

and no Transferor nor any affiliate of any Transferor has granted to any third

party any license or other right to any of such Intellectual Property and no

Transferor is a party to or bound by any Contract or any other obligation

whatsoever that limits or impairs its ability to use, sell, transfer, assign or

convey the Intellectual Property, except for restrictions on assignment included

within licenses to use the Intellectual Property. Except as set forth in

Transferor Disclosure Schedule 3.11, none of the Trademarks that constitute the

Intellectual Property are being used by any Transferor or any affiliate thereof

in connection with the conduct of any business other than the Operations. Except

as set forth in Transferor Disclosure Schedule 3.11, no claim is pending or, to

the knowledge of the Alon Parties, threatened against any Transferor or any

affiliate thereof asserting that its use of the Intellectual Property infringes

the patent, trademark, copyright or other intellectual property rights of any

person and, to the knowledge of the Alon Parties, the use of such Intellectual

Property does not infringe any such rights. To the knowledge of the Alon

Parties, no person is infringing any Transferor's rights in its Intellectual

Property. All registrations and certificates issued by any Governmental Entity

relating to any of such Intellectual Property and all Contracts pursuant to

which any Transferor uses any of the Intellectual Property are valid and

subsisting, have been properly maintained and no Transferor nor any other person

is in default or violation thereunder.

3.12 SOFTWARE PRODUCTS. Except for Excluded Assets, Transferor Disclosure

Schedule 3.12 contains a true, complete and correct list of all software

products and custom software that Transferors own or license from a third party

that is used primarily in connection with the Operations. To the knowledge of

the Alon Parties, the use of such software products and custom software by the

applicable Transferor does not violate any rights of any other person, and no

Transferor nor any affiliate of any Transferor has received any communication

alleging such a violation. Except as set forth in Transferor Disclosure Schedule

3.12, no Transferor is obligated to compensate any person for the licensing of

such software products or custom software.

3.13 TAXES. Each Transferor and any consolidated, combined or unitary

group of which such Transferor is or has been a member has timely filed with the

appropriate Taxing Authorities all Tax returns required to be filed on or prior

to the date of this Agreement. All such Tax returns are true, correct and

complete in all material respects and the applicable Transferor or an affiliate

of such Transferor has timely paid all Taxes shown as due and payable on all Tax

returns. No Taxing Authority has raised any issues relating to Taxes for which a

Lien could otherwise be imposed after the Closing Date upon any of the

Contributed Assets. Except as set forth in Transferor Disclosure Schedule 3.13,

no audit or other proceeding by any Governmental Entity is pending or, to the

knowledge of the Alon Parties, threatened with respect to any Taxes due or any

Tax return filed by any Transferor or any affiliate of any Transferor relating

to the Pipeline and Terminal Assets or the Operations. No assessment of any Tax

(other than assessments of Taxes not yet due) is proposed against any Transferor

or any of its affiliates relating to any of the Contributed Assets. No

Transferor nor any affiliate of any Transferor has been and is now in violation

(and with notice or lapse of time, or both, would be in violation) of

HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

<PAGE>

any applicable Law relating to the payment or withholding of Taxes relating to

the Contributed Assets or the Operations.

3.14 SUFFICIENCY AND CONDITION OF ASSETS; ENTIRE OPERATIONS. Except as set

forth in Transferor Disclosure Schedule 3.14, (a) the Contributed Assets are in

adequate and sufficient operating condition and repair (normal wear and tear

excepted) to enable Newco 1 after the Closing to conduct the Operations as

currently conducted and are suitable for the purposes for which they are

currently used, (b) the Contributed Assets constitute all of the assets, real

and personal, tangible and intangible, necessary to conduct the Operations in

the manner presently conducted and (c) the Contributed Assets meet the legally

required mechanical integrity and other standards of the Department of

Transportation and the Environmental Protection Agency in all material respects.

Transferor Disclosure Schedule 3.14 sets forth the date of the most recent

linalog testing for mechanical integrity performed on each of the Pipelines and

true, correct and complete copies of the results of such testing have been

provided to Transferee. Prior to the date of this Agreement T&R has transferred,

conveyed and assigned all right, title and interest in the water discharge

pipeline related to Alon Refining's management control area for the Big Spring,

Texas refinery such that T&R has no right, title or interest in, or is obligated

with respect to any liability or obligation associated with, such pipeline, and

Newco 1 shall not receive any such right, title or interest, or liability or

obligation, upon the contribution and assumption contemplated by Sections 1.1

and 1.3 hereof.

3.15 COLLECTIVE BARGAINING AGREEMENTS; LABOR RELATIONS. Except as

described in Transferor Disclosure Schedule 3.15:

(a) No Transferor nor any affiliate of any Transferor is a party

to any collective bargaining agreement with any labor organization relating to

employees involved in the operation of the Pipeline and Terminal Assets.

(b) No Transferor nor any affiliate of any Transferor has agreed

to recognize any union or other collective bargaining representative, nor has

any union or other collective bargaining representative been certified as the

exclusive bargaining representative of any employees involved in the operation

of the Pipeline and Terminal Assets.

certifications, collective agreements, letters of understanding and any

applicable orders of the National Labor Relations Board pertaining to a labor

organization and which relate to the employment of any employee involved in the

operation of the Pipeline and Terminal Assets.

(d) There is no pending or, to the knowledge of the Alon Parties,

threatened, strike, slowdown, lock-out, work-stoppage, representation petition

or other labor union organizing effort or other labor dispute, labor board

proceeding, labor arbitration proceeding, or administrative tribunal proceeding,

involving any employees involved in the operation of the Pipeline and Terminal

Assets.

3.16 EMPLOYEES; EMPLOYEE BENEFIT MATTERS. (a) Transferor Disclosure

Schedule 3.16 contains a true, correct and complete list of the names of all

employees involved in the

HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

<PAGE>

operation of the Pipeline and Terminal Assets as of the date of this Agreement,

specifying each employee's job title and salary.

(b) Transferor Disclosure Schedule 3.16(b) lists each Employee

Benefit Plan and material Benefit Arrangement maintained by any Transferor or

any ERISA Affiliate of any Transferor immediately prior to the Closing with

respect to any of the employees involved in the operation of the Pipeline and

Terminal Assets and any Employee Benefit Plan maintained or contributed to by

any Transferor or any ERISA Affiliate of any Transferor, that is subject to

Title IV of ERISA.

complete copies of all Employee Benefit Plans and material Benefit Arrangements

listed in Transferor Disclosure Schedule 3.16(b).

(d) Transferors have made available for Transferee's inspection a

list on a per employee basis and in reasonable detail of all current annual

compensation expenditures for the employees involved in the operation of the

Pipeline and Terminal Assets, including bonuses and similar amounts.

(e) Except as otherwise set forth in Transferor Disclosure

Schedule 3.16(e):

(i) As to any Employee Benefit Plan listed in Transferor

Disclosure Schedule 3.16(b) and subject to Title IV of ERISA, there has been no

event or condition which presents the risk of plan termination, no accumulated

funding deficiency, whether or not waived, within the meaning of Section 302 of

ERISA or Section 412 of the Code has been incurred, no reportable event within

the meaning of Section 4043 of ERISA (for which the disclosure requirements of

Regulation Section 4043.1 et seq., promulgated by the PBGC have not been waived)

has occurred, no notice of intent to terminate the plan has been given under

Section 4041 of ERISA and no proceeding has been instituted under Section 4042

of ERISA to terminate the plan, no liability to the PBGC has been incurred.

(ii) With respect to any Employee Benefit Plan, within the

meaning of Section 3(3) of ERISA, which is not listed in Transferor Disclosure

Schedule 3.16(b) but which has been sponsored, maintained or contributed to

within six years prior to the Closing Date by any Transferor or any ERISA

Affiliate of any Transferor, (A) no withdrawal liability, within the meaning of

Section 4201 of ERISA, has been incurred, which withdrawal liability has not

been satisfied, (B) no liability to the PBGC has been incurred, which liability

has not been satisfied, (C) no accumulated funding deficiency, whether or not

waived, within the meaning of Section 302 of ERISA or Section 412 of the Code

has been incurred, and (D) all contributions (including installments) to such

plan required by Section 302 of ERISA and Section 412 of the Code have been

timely made.

3.17 PERFORMANCE OF PIPELINES; PERFORMANCE OF TERMINALS.

HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

<PAGE>

(a) Performance of Pipelines. Each of the Pipelines is currently

capable, in accordance with all applicable Laws and Permits, of transporting

refined products at the volumes set forth in Transferor Disclosure Schedule

3.17(a).

(b) Performance of Terminals. Each of the Terminals is currently

capable, in accordance with all applicable Laws and Permits, of receiving,

delivering, storing, blending or otherwise handling refined products at the

respective capacities set forth in Transferor Disclosure Schedule 3.17(b).

3.18 INSURANCE. Transferor Disclosure Schedule 3.18 sets forth a list

(including nature of coverage, limits, deductibles and premiums) of all policies

or binders of fire, casualty, liability, burglary, fidelity, workers'

compensation, vehicular and other non-ERISA related insurance maintained, owned

or held by any Transferor or its affiliate on the date of this Agreement and

covering the Contributed Assets.

3.19 STATUS OF TRANSFEROR PARTIES. None of the Alon Parties or Newco 1 is

(a) a "public utility company" or a "holding company," or a "subsidiary company"

of a "holding company," or an "affiliate" of either a "holding company" or a

"subsidiary company" of a "holding company," in each case within the meaning of

the Public Utility Holding Company Act of 1935 or (b) an "investment company" or

a company "controlled" by an "investment company" within the meaning of the

Investment Company Act of 1940.

3.20 ENVIRONMENTAL MATTERS.

(a) Actions. Except as set forth on Transferor Disclosure Schedule

3.20(a), there are no Actions pending or, to the knowledge of the Alon Parties,

threatened to which any Transferor or any of its affiliates is, or is threatened

to be made, a party in which Environmental Costs or Liabilities are being, or

are threatened to be, asserted or directed against such Transferor or any of its

affiliates relating to any of the Pipeline and Terminal Assets or the Operations

that (x) pertain or relate to (i) any remedial obligations presently required

under any applicable Environmental Law, (ii) violations by such Transferor or

any of its affiliates of any Environmental Law, (iii) personal injury or

property damage claims relating to a release of Hazardous Materials or (iv)

response, removal or remedial costs under any Environmental Law, and (y) which

could reasonably be expected to have a Material Adverse Effect.

(b) Compliance. Except as set forth on Transferor Disclosure

Schedule 3.20(b) or which could not be reasonably expected to have a Material

Adverse Effect:

(i) No Transferor nor any affiliate of any Transferor has

caused or allowed the generation, use, treatment, storage or disposal of

Hazardous Materials at or on any of the Pipeline and Terminal Assets except in

accordance with all applicable Environmental Laws.

(ii) With respect to the current operation of the Pipeline

and Terminal Assets, each Transferor is in compliance, in all material respects,

with all limitations, restrictions, standards and obligations established under

Environmental Laws, except for violations that are or can be remedied by routine

repair and maintenance in the ordinary course of business.

HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

<PAGE>

(iii) Set forth in Transferor Disclosure Schedule 3.20(b)(iii)

is a true, correct and complete list of all Environmental Permits held by each

Transferor in connection with the ownership and operation of the Pipeline and

Terminal Assets in the manner they are currently operated. All such

Environmental Permits have been duly obtained or filed and are in full force and

effect, and the applicable Transferor is in compliance, in all material

respects, with such Environmental Permits. The current operation of the Pipeline

and Terminal Assets does not provide a basis for revocation or suspension of any

Environmental Permit.

(iv) None of the Pipeline and Terminal Assets is encumbered

by a Lien arising or imposed under Environmental Laws.

(v) To the knowledge of the Alon Parties, there are no

Hazardous Materials present on any of the Real Property in amounts that could

give rise to an obligation to perform remediation or other corrective action

pursuant to Environmental Laws, except for remediation or corrective action that

could not reasonably be expected to result in a material liability or materially

impair the conduct of the Operations from and after the Closing.

3.21 BROKERS AND FINDERS. No investment banker, broker, finder, financial

advisor or other intermediary has been retained by or is authorized to act on

behalf of any of the Alon Parties or Newco 1 who is entitled to receive from

Transferee any fee or commission in connection with the transactions

contemplated by this Agreement.

3.22 REPRESENTATIONS RELATING TO THE CLASS B UNITS.

(a) Each Transferor and Newco 2 is an "Accredited Investor" as

defined in Rule 501(a) of Regulation D promulgated under the Securities Act.

(b) Each Transferor and Newco 2 is acquiring the Class B Units for

its own account for investment, and not with a view to any distribution or

resale thereof in violation of the Securities Act or any other applicable

domestic or foreign securities law.

copy of the First Amended and Restated Agreement of Limited Partnership of

Transferee, as amended (the "Transferee Partnership Agreement"), and the Class B

Amendment, and acknowledges access to the Transferee Public Documents. Each

Transferor and Newco 2 and their attorneys, accountants and other

representatives have had an opportunity to ask questions of and receive answers

from Transferee or a person acting on behalf of Transferee concerning the terms

and conditions of their investment in the Class B Units.

(d) Each Transferor and Newco 2 acknowledges and agrees that,

based in part upon its representations contained herein and in reliance upon

applicable exemptions, the Class B Units to be acquired by Newco 2 will not be

registered under the Securities Act or the securities Laws of any other domestic

or foreign jurisdiction as of the Closing Date.

3.23 WAIVERS AND DISCLAIMERS. TRANSFEREE ACKNOWLEDGES THAT IT HAS HAD AN

OPPORTUNITY TO INSPECT THE CONTRIBUTED ASSETS,

HOLLY ENERGY PARTNERS, L.P.

CONTRIBUTION AGREEMENT

<PAGE>

THAT TRANSFEREE HAS CONDUCTED ITS INDEPENDENT DUE DILIGENCE INVESTIGATION AND

INSPECTION OF ALL ASPECTS OF SUCH CONTRIBUTED ASSETS AND THE CLOSING OF THE

TRANSACTIONS CONTEMPLATED HEREBY IS NOT CONDITIONED ON TRANSFEREE CONDUCTING

FURTHER DUE DILIGENCE. OTHER THAN AS EXPRESSLY SET OUT HEREIN OR IN THE ALON

ANCILLARY DOCUMENTS, TRANSFEREE IS RELYING ON SUCH INDEPENDENT INVESTIGATION AND

INSPECTION OF THE CONTRIBUTED ASSETS AND IS NOT RELYING ON ANY INFORMATION

PROVIDED BY TRANSFERORS OR THEIR AGENTS AND REPRESENTATIVES IN DETERMINING

WHETHER TO ACQUIRE THE CONTRIBUTED ASSETS.

NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS AGREEMENT,

EXCEPT FOR THE EXPRESS REPRESENTATIONS AND WARRANTIES AND OTHER COVENANTS AND

AGREEMENTS MADE BY THE ALON PARTIES IN THIS AGREEMENT AND THE ALON ANCILLARY

DOCUMENTS, TRANSFEREE ACKNOWLEDGES AND AGREES THAT THE CONTRIBUTION OF THE

CONTRIBUTED ASSETS AS PROVIDED FOR HEREIN SHALL BE MADE IN AN "AS IS", "WHERE

IS" CONDITION WITH ALL FAULTS AND THAT THE ALON PARTIES HAVE NOT MADE, NOR DO

MAKE, A

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