PARTNERSHIP AGREEMENT

1.1       Specific Definitions . As used in this Agreement, the following terms have the following meanings:

“ Acceptance Notice ” has the meaning given that term in Section 3.4(e)(i) .

“ Accessible Capacity ” means that portion of the Base Capacity which is commercially useable for the receipt, storage and delivery of incremental Oil, taking into consideration committed amounts (including binding letter of intent commitments), operating and capital costs, hydraulics, use of flow inducer and/or drag-reducing agents and other similar factors to receive, store, and deliver relevant additional Expansion Throughput.

“ Act ” means the Delaware Revised Uniform Partnership Act.

“ Adjusted Capital Account ” means the Capital Account maintained for each Party as of the end of each taxable year of the Company, (a) increased by any amounts that such Party is obligated to restore under the standards set by Treasury Regulation section 1.704-1(b)(2)(ii)(c) (or is deemed obligated to restore pursuant to the penultimate sentences of Treasury Regulation sections 1.704-2(g)(1) and 1.704-2(i)(5)), and (b) decreased by (i) the amount of all losses and deductions that, as of the end of such taxable year, are reasonably expected to be allocated to such Party in subsequent years under sections 704(e)(2) and 706(d) of the Code and Treasury Regulation section 1.751-1(b)(2)(ii), and (ii) the amount of all distributions that, as of the end of such taxable year, are reasonably expected to be made to such Party in subsequent years in

accordance with the terms of this Agreement or otherwise to the extent they exceed offsetting increases to such Party’s Capital Account that are reasonably expected to occur during (or prior to) the year in which such distributions are reasonably expected to be made (other than increases as a result of a minimum chargeback pursuant to Section 5.1(d) or 5.1(e) ).  The foregoing definition of Adjusted Capital Account is intended to comply with the provisions of Treasury Regulation section 1.704-1(b)(2)(ii)(d) and will be interpreted consistently therewith.

“ Adjusted Property ” means any property, the Carrying Value of which has been adjusted pursuant to Section 4.5(d) .

“ Affected Interest ” has the meaning ascribed to it in Section 3.4(f)(i)(A) .

“ Affected Partner ” has the meaning ascribed to it in Section 3.4(f)(i)(A) .

“ Affiliate ” means, with respect to any relevant Person, any other Person that directly or indirectly, through one or more intermediaries, Controls, is Controlled by, or is under common Control with, the relevant Person.  Notwithstanding the foregoing, solely for the purposes of this Agreement (i) the Company and its Subsidiaries will be deemed not to be Affiliates of any Partner or any of its Affiliates, and vice-versa; and (ii) no Partner will be deemed to be an Affiliate of any other Partner solely because of their ownership of Partnership Interests.

“ Agreed Value ” of any Contributed Property or Adjusted Property means the Fair Market Value of such property or other consideration at the time of contribution or adjustment, as applicable, as determined by the Partners.  The Partners will, in their sole discretion, use such method as they deem reasonable and appropriate to allocate the aggregate Agreed Value of Contributed Properties or Adjusted Properties in a single or integrated transaction among such properties on a basis proportional to their Fair Market Value.

“ Agreement ” means this Partnership Agreement (including any schedules, exhibits or attachments hereto), as amended, supplemented or modified from time to time.

“ Appraised Value ” has the meaning given that term in Section 3.4(e)(iv) .

“ Appraiser ” means a reputable accounting, appraisal or investment banking firm recognized as an expert in rendering valuation opinions on transactions such as that proposed.

“ Available Cash ” means unrestricted cash and cash equivalents of the Company less reasonable cash reserves set aside pursuant to Section 5.5 .

“ Bankrupt Partner ” means any Party:

(a)      that (i) makes a general assignment for the benefit of creditors, (ii) files a voluntary bankruptcy petition, (iii) becomes the subject of an order for relief or is declared insolvent in any federal or state bankruptcy or insolvency proceeding, (iv) files a petition or answer seeking for the Party a reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any law, (v) files an answer or other pleading admitting or failing to contest the material allegations of a petition filed against the Party in a proceeding of the type described in subclauses (i) through (iv) of

this clause (a), or (vi) seeks, consents, or acquiesces to the appointment of a trustee, receiver or liquidator of the Party or of all or any substantial part of the Party’s properties; or

(b)      against which a proceeding seeking reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any Law has been commenced and 90 Days have expired without dismissal thereof or with respect to which, without the Party’s consent or acquiescence, a trustee, receiver, or liquidator of the Party or of all or any substantial part of the Party’s properties has been appointed and 60 Days have expired without such appointments having been vacated or stayed, or 60 Days have expired after the date of expiration of a stay, if the appointment has not previously been vacated.

“ Base Capacity ” means the Maximum Throughput Capacity on the relevant portion of TOPS immediately before the commencement of the relevant Expansion Project, but excluding any capacity related to any Expansion Project for which full payout has not occurred as of the date such Base Capacity is assessed.

“ Book-Tax Disparity ” means with respect to any item of Contributed Property or Adjusted Property, as of the date of any determination, the difference between the Carrying Value of such Contributed Property or Adjusted Property and the adjusted basis thereof for federal income tax purposes as of such date.  A Party’s share of the Company’s Book-Tax Disparities in all of its Contributed Property and Adjusted Property will be reflected by the difference between such Party’s Capital Account balance as maintained pursuant to Section 4.5 and the hypothetical balance of such Party’s Capital Account computed as if it had been maintained strictly in accordance with federal income tax accounting principles.  The determination of Book-Tax Disparity and a Party’s share thereof will be determined consistently with section 1.704-3(c) of the Treasury Regulations.

“ Budget ” means the construction budget attached hereto as Schedule 3 , any amendments thereto approved by the Partners and any other budget or budgets approved by the Partners.

“ Business Day ” means Monday through Friday of each week, except that a legal holiday recognized as such by the government of the United States or the nationally-chartered banking institutions in the State of Texas will not be regarded as a Business Day.

“ Capacity Request ” has the meaning given that term in Section 15.3 .

“ Capital Account ” means the capital account maintained for each Party pursuant to Section 4.5 .

“ Capital Call Dispute ” has the meaning given that term in Section 4.1(d)

“ Capital Call Dispute Notice ” has the meaning given that term in Section 4.1(d) .

“ Capital Call Dispute Period ” has the meaning given that term in Section 4.1(d) .

“ Capital Call Notice ” has the meaning given that term in Section 4.1(c) .

“ Capital Contribution ” means any contribution by a Party to the capital of the Company, as contemplated by Section 4.5(a) .

“ Carrying Value ” means (a) with respect to Contributed Property and Adjusted Property, the Agreed Value of such property reduced (but not below zero) by all depreciation, amortization and cost recovery deductions relating to such property charged to the Party’s Capital Accounts, and (b) with respect to any other Company property, the adjusted basis of such property for federal income tax purposes, all as of the time of determination.  The Carrying Value of any property will be adjusted from time to time in accordance with Sections 4.5(d)(i) and 4.5(d)(ii) and to reflect changes, additions or other adjustments to the Carrying Value for dispositions and acquisitions of Company properties, as deemed appropriate by a Required Interest.

“ Change of Control ” means, with respect to any Party, a change in the Person or Persons that ultimately Controls such Party (including the acquisition by any Person or two or more Persons acting in concert, other than the management or the shareholders of such Controlling Person or Persons immediately prior to the change, of beneficial ownership (within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as amended) of 50% or more of the issued and outstanding shares of Voting Stock of such Controlling Person or Persons); provided, that a change of control with respect to a relevant Person that does not ultimately Control such relevant Person (for example, an intermediate holding company subsidiary of another Person that ultimately controls such relevant Person) shall not constitute a Change of Control.

“ Change of Control Notice ” has the meaning given that term in Section 3.4(f)(i)(B) .

“ Change of Control Notice Date ” means the later of (i) the date the Change of Control Notice is delivered to all Non-Affected Partners and (ii) the closing date of the transaction constituting the applicable Change of Control.

“ Change of Control Option Period ” has the meaning given to that term in Section 3.4(f)(i)(D) .

“ Code ” means the Internal Revenue Code of 1986 and any successor statute, as amended from time to time.

“ Commencement Date ” means the date upon which the Initial Facilities are fully operational.

“ Company ” has the meaning given that term in the preamble.

“ Confidential Information ” has the meaning given that term in Section 3.7(b) .

“ Construction Agreement ” means the Construction Management Agreement (including any schedules, exhibits or attachments thereto) between the Company and Enterprise Field Services, LLC, as amended, restated, supplemented or otherwise modified from time to time.

“ Construction Manager ” means Enterprise Field Services, LLC.

“ Contributed Property ” means each property or other asset, in such form as may be permitted by the Act, but excluding cash or cash equivalents, contributed to the Company (or deemed contributed to the Company on termination and reconstitution thereof pursuant to section 708 of the Code).  Following the adjustment of the Carrying Value of a Contributed Property pursuant to Section 4.5(d) , such property will no longer constitute a Contributed Property for purposes of Section 5.2 , but will be deemed an Adjusted Property for such purposes.

“ Control ” (and its derivatives and similar terms) means, directly or indirectly, having the ability to direct or cause the direction of the management and policies of any Person, whether by ownership of Voting Stock, contract or otherwise.

“ Costs ” has the meaning given that term in Section 4.3(a)(ii)(C) .

“ Day ” means a period of 24 consecutive hours beginning at 7:00 a.m., Central Time.

“ Default ” means, for any relevant Party, upon the occurrence and during the continuation of any of the following events:

(a)      the failure to remedy, within five Business Days of such relevant Party’s receipt of written notice thereof (from the Company or any other Partner), such Party’s failure to contribute by the required time all or any portion of a Capital Contribution such Party is required to make under Section 4.1 or to which such Party agreed in writing (including by approval of written resolutions), unless: (i) one or more Lending Partners elects to have an advance made on behalf of such Party treated as a loan under Section 4.3(a)(ii) and such Lending Partner(s) agree in writing that such failure to make a Capital Contribution will not be deemed a Default hereunder, in which case no Default will be deemed to exist with respect to the relevant Capital Contribution; or (ii) such Party on account of its failure to contribute has suffered a reduction in its Capital Contributions and adjustment of its Partnership Interest under Section 4.3(a)(i) ;

(b)      the occurrence of any event that causes such relevant Party to become a Bankrupt Partner; or

(c)      the failure to remedy, within 60 Days of receipt of written notice thereof from the Company or any other Partner, the non-performance or breach of or non-compliance with any other material agreement, obligation, representation, warranty, covenant or undertaking (other than the Capital Contribution requirements covered in (a) above) of such relevant Party or one of its Affiliates (that is not a Partner) contained in this Agreement, including the failure to comply with the provisions contained in Section 3.4 (including the failure of a Party to comply with Section 3.4(e) (in the case of a Transfer to which such Section applies) and Section 3.4(f) (in the case of a Change of Control)).

“ Default Interest Rate ” means a rate per annum, compounded monthly, equal to the lesser of (a) two (2) percentage points plus the one-year prime rate that is quoted in the Money Rates Section of The Wall Street Journal (or, in its absence, a similar publication) on the first Business Day of the applicable month and (b) the maximum, lawful interest rate then in effect under applicable Law.

“ Delinquent Party ” has the meaning given that term in Section 4.3(a) .

“ Determining Engineer ” means Stone & Webster or, if Stone & Webster is unavailable or unwilling to serve on reasonable terms, any other comparable engineering firm selected by the Management Committee.

“ DOE Lease ” means that certain U.S. Department of Energy Bryan Mound Pipeline Lease Agreement that may be entered into between the United States of America, acting by and through the United States Department of Energy Strategic Petroleum Reserve, and the Company, for the lease of pipelines that the Company has the option under certain Throughput Agreements to make a part of TOPS.

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

“ Effective Date ” has the meaning given that term in the preamble.

“ Eligible Partner ” means a Partner eligible to vote on or consent to the applicable matter, and excludes (a) with respect to an Interested Partner Transaction, each Interested Partner, (b) with respect to any litigation, arbitration or similar proceedings (including any proposed or threatened litigation, arbitration or similar proceeding) to which a Partner or an Affiliate thereof is adverse to the Company, such adverse Partner and its Affiliates, (c) with respect to a matter involving a Transferring Party, such Transferring Party and its Affiliates, (d) with respect to prepayment of the unamortized amount of a Payout Amount, the Expansion Participants and their Affiliates, (e) with respect to any Capacity Request, any Partner who, or whose Affiliate, delivered such Capacity Request, (f) with respect to the dissociation of any Party, the Party (and its Affiliates) whose dissociation is proposed, and (g) with respect to the admission as a Substituted Partner of any Transferee that acquired its Partnership Interest through a Foreclosure Transfer, the Partner whose Partnership Interest or other interest is the subject of such Foreclosure Transfer; provided , that TEPPCO and Enterprise shall be deemed not to be Affiliates for purposes of this definition.

“ Enterprise ” means Enterprise Offshore Port System, LLC, a Texas limited liability company.

“ Exercising Partner ” has the meaning given that term in Section 15.3 .

“ Expanded Capacity ” means, with respect to a relevant Expansion Project, the additional throughput capacity created on TOPS as a result of such relevant Expansion Project built pursuant to Section 15.3 .

“ Expanded Capacity Revenues ” means net revenues from throughput services provided on TOPS, and from any other services provided by the Company or its Subsidiaries, that are attributable to the Expanded Capacity Volumes, less an amount equal to the sum of (a) the Company’s operating costs attributable to the Expanded Capacity, plus (b) a pro rata portion of the Company’s overhead costs (based on the Expanded Capacity Volume as compared to Base Capacity).

“ Expanded Capacity Volumes ” means, for the relevant month, the lesser of (a) the Expanded Capacity or (b) the Expansion Throughput.

“ Expansion Liquidation Value ” has the meaning given that term in Section 12.2(c)(iii)(A) .

“ Expansion Option ” has the meaning given that term in Section 15.3(a) .

“ Expansion Option Notice ” has the meaning given that term in Section 15.3(b) .

“ Expansion Option Period ” has the meaning given that term in Section 15.3(a)(iv) .

“ Expansion Participants ” has the meaning given that term in Section 15.3(b) .

“ Expansion Project ” means (a) the installation of additional pumping facilities on or tied into the then-existing TOPS, (b) the construction and installation of one or more additional pipelines to loop the oil pipeline included in TOPS or (c) other than a Lateral that connects at a Lateral Connection Point, any physical enhancement or series of physical enhancements which would increase the Base Capacity of any then existing pipeline, lateral, segment, extension or other significant oil handling facility owned, leased or otherwise controlled by the Company or its Subsidiaries, including adding pumps to one or more existing pipelines, laterals, segments or extensions or constructing a new pipeline, lateral, segment or extension (which does not constitute a Lateral that connects at a Lateral Connection Point).

“ Expansion Throughput ” has the meaning given that term in Section 15.3(a)(i) .

“ Fair Market Value ” of an asset, transaction or a Partnership Interest means the fair market value of such asset, transaction or interest, based upon appropriate valuation methods and techniques, (a) without adding premiums or deducting discounts for controlling interests, minority interests or illiquidity, but (b) taking into consideration adjustments for abnormal or non-recurring amounts or activities and earnings multiples earned by companies in businesses similar to the Company.

“ Foreclosure Transfer ” means any Transfer resulting from any judicial or non-judicial foreclosure by the holder of a Security Interest or any Transfer to the holder of a Security Interest in connection with a workout or similar arrangement or any Transfer from the holder of a Security Interest.

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

“ Governmental Authority ” means any legislature, agency, bureau, branch, department, division, commission, court, tribunal, magistrate, justice, multi-national organization, quasi-governmental authority, or other similar recognized organization or body of any federal, state, county, municipal, local, or foreign government or other similar recognized organization or body exercising similar powers or authority.

“ Incremental Volumes ” means, with respect to a relevant month, the aggregate volumes received, stored and delivered by TOPS in excess of the Base Capacity, plus the relevant Expansion Throughput; provided, however , that the Incremental Volumes will be applied to Expansion Projects which have not paid out pursuant to Section 15.3 in chronological order of completion.

“ Initial Facilities ” means the proposed offshore oil port consisting of two single point moorings, platforms, meters, pumps, oil delivery pipelines, storage tank farm and related facilities described on Schedule 1 to be constructed, leased, owned or otherwise acquired by the Company (and any changes thereto approved by a Unanimous Interest) and including any additional facilities that the Company is obligated to construct, lease or otherwise acquire pursuant to any Throughput Agreement.

“ Initial Facilities Capital Contributions ” has the meaning given that term in Section 4.1 .

“ Interested Partner ” means, with respect to any Interested Partner Transaction, any Party that is party to (or has an Affiliate that is party to) such transaction; provided , that TEPPCO and  Enterprise shall be deemed not to be Affiliates for purposes of this definition.

“ Interested Partner Transaction ” means any transaction or agreement (or proposed transaction or agreement), including the purchase, sale, lease or exchange of property (tangible or intangible) or the rendering of any service, involving the Company or any of its Subsidiaries on the one hand and any Party or Parties (or Affiliate(s) thereof) on the other hand, including the waiver, amendment, termination (other than by expiration of the term thereof) or any other modification of any such agreement.

“ Lateral ” means any pipeline, lateral, segment or extension that directly connects or is proposed to directly connect to the then-existing TOPS.

“ Lateral Connection Point ” means (a) with respect to any proposed Oil pipeline, lateral, segment or extension that is proposed to connect one or more delivery points to the then-existing TOPS, the closest and most practical connection point or points, taking into account the location of the relevant delivery points and the then-existing TOPS, where sufficient capacity for Oil to be delivered to refineries connected to such proposed pipeline, lateral or segment is available (or could be made available by acquiring, constructing or otherwise obtaining additional facilities in accordance with the terms of Section 7.2 or (b) any other interconnection point approved by a Required Interest.

“ Lateral Opportunity ” has the meaning given that term in Section 15.1 .

“ Lateral Opportunity Notice ” has the meaning given that term in Section 15.1(a) .

“ Law ” means any law (statutory, common, or otherwise), constitution, treaty, convention, ordinance, equitable principle, code, rule, regulation, executive order, or other similar authority enacted, adopted, promulgated, or applied by any Governmental Authority, each as amended and now and hereinafter in effect.

“ Lending Partner ” has the meaning given that term in Section 4.3(a)(ii) .

“ Liquidator ” has the meaning given that term in Section 12.2 .

“ Loss ” or “ Losses ” means, subject to the limitations set forth in Section 16.17 , any actions, claims, settlements, judgments, arbitration awards, demands, liens, losses, damages, fines, penalties, interest costs, expenses (including expenses attributable to the defense or enforcement of any actions or claims), reasonable and necessary attorneys’ and experts’ fees and liabilities.

“ Majority Interest ” means any one or more Eligible Partners having among them more than 50% of the Partnership Interests of all Eligible Partners.

“ Management Committee ” has the meaning given that term in Section 6.2(a) .

“ Management Dispute ” has the meaning given that term in Section7.9 .

“ Maximum Throughput Capacity ” means the then existing maximum throughput capacity, taking into account operational (e.g., drag reducing agents) and physical capabilities of the relevant portion of TOPS.

“ Minimum Gain Attributable to Partner Nonrecourse Debt ” means that amount determined in accordance with the principles of Treasury Regulation section 1.704-2(i)(3).

“ Net Agreed Value ” means (a) in the case of any Contributed Property, the Fair Market Value of such property reduced by any liabilities either assumed by the Company upon such contribution or to which such property is subject when contributed and (b) in the case of any property distributed to a Party by the Company, the Company’s Carrying Value of such property at the time such property is distributed, reduced by any indebtedness either assumed by such Party upon such distribution or to which such property is subject at the time of distribution as determined under section 752 of the Code.

“ Net Income ” means, for any taxable period, the excess, if any, of the Company’s items of income and gain for such taxable period over the Company’s items of loss and deduction for such taxable period.  The items included in the calculation of Net Income will be determined in accordance with Section 4.5(b) and will not include any items specifically allocated under Sections 5.1(d) through 5.1(j) .  For purposes of Sections 5.1(a) and (b) , in determining whether Net Income has been allocated to any Party for any previous taxable period, any Unrealized Gain or Unrealized Loss allocated pursuant to Section 4.5(d) will be treated as an item of gain or loss in computing Net Income.

“ Net Loss ” means, for any taxable period, the excess, if any, of the Company’s items of loss and deduction for such taxable period over the Company’s items of income and gain for such taxable period.  The items included in the calculation of Net Loss will be determined in accordance with Section 4.5(b) and will not include any items specifically allocated under Sections 5.1(d) through 5.1(j) .  For purposes of Sections 5.1(a) and (b) , in determining whether Net Loss has been allocated to any Party for any previous taxable period, any Unrealized Gain or Unrealized Loss allocated pursuant to Section 4.5(d) will be treated as an item of gain or loss in computing Net Loss.

“ Non-Cash Consideration ” has the meaning given that term in Section 3.4(e)(vi) .

“ Non-Defaulting Partner ” means a Partner that is not in Default hereunder.

“ Non-Delinquent Partner ” means any Partner that is not a Delinquent Party.

“ Non-Transferring Partners ” has the meaning assigned to such term in Section 3.4(e)(i) .

“ Nonrecourse Built-in Gain ” means with respect to any Contributed Properties or Adjusted Properties that are subject to a mortgage or negative pledge securing a Nonrecourse Liability, the amount of any taxable gain that would be allocated to the Party pursuant to Section 5.2(b)(i)(A) or 5.2(b)(ii)(A) if such properties were disposed of in a taxable transaction in full satisfaction of such liabilities and for no other consideration.

“ Nonrecourse Debt ” has the meaning given the term “nonrecourse liability” in Treasury Regulation section 1.704-2(b)(3).

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

“ Nonrecourse Liability ” has the meaning given that term in Treasury Regulation section 1.704-2(b)(3).

“ Obligation ” has the meaning given that term in Section 4.3(a)(ii)(B) .

“ Offer Notice ” has the meaning given that term in Section 3.4(e)(i) .

“ Oil ” means the liquid hydrocarbon production from wells, or a blend of such, in its natural form, not having been enhanced or altered in any manner or by any process, other than these processes that normally occur on an offshore production facility, that would result in misrepresentation of its true value for adaptability to refining as a whole crude oil.

“ Oiltanking ” means Oiltanking Freeport L.P., a Texas limited partnership.

“ Operating Agreement ” means the Operation and Management Agreement (including any schedules, exhibits or attachments thereto) between the Company and the Operator, as amended, restated, supplemented or otherwise modified from time to time.

“ Operator ” means Enterprise Field Services, LLC.

“ Option Period ” has the meaning given that term in Section 3.4(e)(i) .

“ Partner ” means any Person executing this Agreement as of the Effective Date as a Partner or any Person thereafter admitted to the Company as an additional Partner or a Substituted Partner as provided in this Agreement, but does not include any Person who has ceased to be a Partner in the Company.

“ Partnership Interest ” means the ownership interest (on a percentage basis) of a Party in the Company, including rights to distributions (liquidating or otherwise), allocations, information, and to consent, approve or disapprove (subject to the limitations set forth in this Agreement) specified actions, which ownership interest is more particularly described and identified in Article III and Exhibit A .

“ Partnership Minimum Gain ” means the amount determined pursuant to Treasury Regulation section 1.704-2(d).

“ Party ” means any Person that is a party to this Agreement, whether as a Partner or a Transferee.

“ Payout Amount ” means an amount of money equal to 250% of the amount of the actual out-of-pocket capital cost of the relevant Expansion Project; provided , however that to the extent the Company elects to prepay all or any portion of the unamortized portion of the principal amount of the payout balance in accordance with Section 15.3 , such Payout Amount will be reduced as described in Section 15.3(c) .

“ Person ” means any individual or entity, including any corporation, limited liability company, partnership (general or limited), joint venture, association, joint stock company, trust, unincorporated organization or government (including any board, agency, political subdivision or other body thereof).

“ Proceeding ” has the meaning given that term in Section 8.1 .

“ Proposed Transaction ” has the meaning given that term in Section 3.4(e)(i) .

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

“ Record Date ” means the date established by the Company for determining (a) the identity of Partners (or Transferees, if applicable) entitled to notice of, or to vote at, any meeting of Partners or entitled to vote by ballot or give approval of Company action in writing without a meeting or entitled to exercise rights in respect of any lawful action of Partners, or (b) the identity of Record Holders entitled to receive any report or distribution.

“ Record Holder ” means the Person in whose name a Partnership Interest is registered on the books of the Company as of the opening of business on a particular Business Day.

“ Rejected Lateral Opportunity ” has the meaning given that term in Section 15.1(a) .

“ Related Agreements ” mean the Operating Agreement and the Construction Agreement.

“ Required Interest ” means one or more Eligible Partners holding the applicable percentage of Partnership Interests required to authorize or approve a relevant act of the Company, including a Majority Interest or a Unanimous Interest, as applicable.

“ Residual Gain ” or “ Residual Loss ” means any item of gain or loss, as the case may be, of the Company recognized for federal income tax purposes resulting from a sale, exchange or other disposition of a Contributed Property or Adjusted Property, to the extent such item of gain or loss is not allocated pursuant to Section 5.2(b)(i)(A) or 5.2(b)(ii)(A) , to eliminate Book-Tax Disparities.

“ Security Interest ” means any security interest, lien, mortgage, encumbrance, hypothecation, pledge, or other obligation, whether created by operation of law or otherwise, created by any Person in any of its property or rights as part of a bona fide arms-length secured transaction.

“ Service ” means the Internal Revenue Service and any successor agency.

“ Subject Interest ” has the meaning given that term in Section 3.4(e)(i).

“ Subsidiary ” means, with respect to any relevant Person, any other Person that is Controlled and more than 50%-owned (directly or indirectly) by the relevant Person.  Notwithstanding the foregoing, solely for the purposes of this Agreement, the Company and its Subsidiaries will be deemed not to be Subsidiaries of any Partner or any of its Affiliates, and vice-versa.

“ Substituted Partner ” means a Person who is admitted as a Partner of the Company because such Person has complied with the requirements of Section 3.4 in place of and with all the rights of a Partner, and who is shown as a Partner on the books and records of the Company.

“ Sufficient Net Worth ” means net worth calculated in accordance with GAAP of at least (a) prior to the completion and placing in service of the Initial Facilities, $300 million or (b) after the completion and placing in service of the Initial Facilities, $150 million.

“ Tax Matters Partner ” has the meaning given that term in Section 9.3 .

“ TEPPCO ” means TEPPCO O/S Port System, LLC, a Texas limited liability company.

“ Throughput Agreement ” means any contract, agreement or other obligation of the Company to receive, store and deliver Oil on TOPS but excludes financial hedging or derivative contracts.

“ TOPS ” means the facilities for the receipt, storage and delivery of Oil owned and/or operated by the Company, consisting of (a) the Initial Facilities, (b) any pipeline laterals (including Laterals), mainlines, segments or extensions or related Oil handling facilities constructed, purchased, leased or otherwise acquired by the Company pursuant to this Agreement and (c) any equipment, facilities, storage tanks and fixtures owned or leased by the Company and located on or connected to such pipelines.

“ Transfer ” or “ Transferred ” means a direct (voluntary or involuntary) sale, assignment, transfer, conveyance, exchange, foreclosure, grant of a security interest in, bequest, devise, gift or any other alienation, by operation of Law or otherwise, (in each case, with or without

consideration) of any rights, interests or obligations with respect to all or any portion of any Partnership Interest, including a Foreclosure Transfer.

“ Transferee ” means a Person who receives all or part of a Partner’s Partnership Interest through a Transfer but who has not become a Substituted Partner.

“ Transferor ” means a Partner, Substituted Partner or a predecessor Transferor who Transfers a Partnership Interest (or a portion thereof).

“ Transferring Party ” has the meaning given that term in Section 3.4(e)(i) .

“ Treasury Regulation ” has the meaning given that term in Section 3.5 .

“ Unanimous Interest ” means one or more Eligible Partners having among them at least 100% of the Partnership Interests of all Eligible Partners.

“ Unanimous Non-Defaulting Interest ” means one or more Non-Defaulting Partners having among them at least one hundred percent (100%) of the Partnership Interests of all Non-Defaulting Partners.

“ Unbudgeted Capital Call ” has the meaning given in Section 4.1(d) .

“ Unrealized Gain ” attributable to any item of Company property means, as of any date of determination, the excess, if any, of (a) the Fair Market Value of such property as of such date over (b) the Carrying Value of such property as of such date (prior to any adjustment to be made pursuant to Section 4.5(d) as of such date).  In determining such Unrealized Gain, the aggregate cash amount and Fair Market Value of a Company asset (including cash or cash equivalents) will be determined by a Majority Interest.

“ Unrealized Loss ” attributable to any item of Company property means, as of any date of determination, the excess, if any, of (a) the Carrying Value of such property as of such date (prior to any adjustment to be made pursuant to Section 4.5(d) as of such date) over (b) the Fair Market Value of such property as of such date.  In determining such Unrealized Loss, the aggregate cash amount and Fair Market Value of a Company asset (including cash or cash equivalents) will be determined by a Majority Interest.

“ Value Disagreement Notice ” has the meaning ascribed to it in Section 3.4(e)(iv) .

“ Voting Stock ” means (a) with respect to a corporation, capital stock issued by such corporation, (b) with respect to a partnership (whether general or limited), any general partner interest in such partnership and (c) with respect to any other entity, the equivalent interests in such entity, the holders of which are ordinarily, in the absence of contingencies, entitled to vote for the election of directors (or Persons with management authority performing similar functions) of such entity.

1.2       Other Terms . Other terms may be defined elsewhere in the text of this Agreement and will have the meanings indicated throughout this Agreement.  Whenever the context requires, the singular will include the plural, and the plural will include the singular.

1.3       Construction . The Parties have participated jointly in the negotiation and drafting of this Agreement.  In the event an ambiguity or question of intent or interpretation arises, this Agreement will be construed as if drafted jointly by the Parties and no presumption or burden of proof will arise favoring or disfavoring any Party by virtue of the authorship of any of the provisions of this Agreement.  Any reference to any federal, state, local, or foreign statute or Law will be deemed to refer to such statute or Law, as amended, and also to refer to all rules and regulations promulgated thereunder, unless the context requires otherwise.  Any reference to a Party will also include such Party’s permitted successors and assigns.  The words “including,” “includes,” and “include” will be deemed to be followed by the phrase “without limitation.” All personal pronouns used in this Agreement, whether used in the masculine, feminine or neuter gender, will include all other genders; the singular will include the plural, and vice versa.  All references herein to Exhibits, Schedules, Articles, Sections or subdivisions thereof will refer to the corresponding Exhibits, Schedules, Article, Section or subdivision thereof of this Agreement unless specific reference is made to such exhibits, articles, sections or subdivisions of another document or instrument.  The terms “herein,” “hereby,” “hereunder,” “hereof,” “hereinafter,” and other equivalent words refer to this Agreement in its entirety and not solely to the particular portion of the Agreement in which such word is used.  Each certificate delivered by a Party, pursuant to this Agreement will be deemed a part hereof, and any representation, warranty or covenant herein referenced or affirmed in such certificate will be treated as a representation, warranty or covenant given in the correlated Section hereof on the date of such certificate.  Additionally, any representation, warranty or covenant made in any such certificate by a Party, will be deemed to be made herein.

2.1       Formation . The Company filed a certificate of partnership existence with the Secretary of State of the State of Delaware on April 16, 2008.

2.2       Name . The name of the Company is “Texas Offshore Port System” and all Company business must be conducted in that name or such other names that comply with applicable Law as the Company may select from time to time.

2.3       Principal Office in the United States; Other Offices . The principal office of the Company in the United States will be at 1100 Louisiana Street, Suite 1000, Houston, Texas 77002 or at such other place as a Majority Interest may designate from time to time, which need not be in the State of Delaware.  The Company may have such other offices as the Partners may designate from time to time.

2.4       Registered Office in the State of Delaware; Registered Agent . The registered office of the Company in the State of Delaware will be at Corporation Trust Center, 1209 Orange Street, Wilmington, New Castle County, Delaware 19801, or at such other place as a Majority Interest may designate from time to time.  The name of the registered agent is The Corporation Trust Company.

2.5       Purpose . The sole purpose of the Company is to, directly or indirectly, (a) design, construct, own, operate and manage (including entering into Throughput Agreements and

financing arrangements related to its operation) the Initial Facilities in accordance with the terms of this Agreement, (b) own and operate any other facilities that constitute a portion of TOPS in accordance with the terms of this Agreement and (c) engage in activities directly related to (a) and (b) above.  Except for activities related to such purposes,   there are no other authorized business purposes of the Company.  The Company will not engage, directly or indirectly, in any activity or conduct inconsistent with such purposes or in any speculative trading, financial or commodity derivatives or hedges or in any activity which a Partner reasonably determines, as of the date of the acquisition or commencement of such activity, would generate income that is not “qualifying income” as defined in Section 7704(d) of the Code.  It is the express intent and purpose of the Partners that the Company is a partnership for a definite term as defined in Section 15-101(14) of the Act and not a partnership at will.

2.6       Foreign Qualification . Prior to the Company conducting business in any jurisdiction other than Delaware, the Company will comply with all requirements under applicable Law necessary to qualify the Company as a foreign general partnership, and, if necessary, keep the Company in good standing, in that jurisdiction.

2.7       Term . The existence of the Company shall extend for a term of 50 years, commencing on the Effective Date, unless otherwise terminated in accordance with Article XII .

2.8       Mergers and Exchanges . Except as otherwise required by this Agreement or by applicable Laws, the Company may be a party to any (a) merger, (b) consolidation, (c) share exchange or (d) other type of reorganization.

2.9       Business Opportunities—No Implied Duties or Obligations .

(a)      Except to the extent expressly provided in Section 15.1 , each Partner and its respective Affiliates may engage, directly or indirectly, without the consent of the other Partners or the Company, in other business opportunities, transactions, ventures or other arrangements of any nature or description, independently or with others, including business of a nature which may be competitive with or the same as or similar to the business of the Company or its Subsidiaries, regardless of the geographic location of such business, and without any duty or obligation to offer or account to the other Partners, the Company or its Subsidiaries in connection therewith.

(b)      Except as specified herein, to the extent that any Partner (in its capacity as a Partner) owes the Company or any other Partner any fiduciary, quasi-fiduciary or other duty with respect to the Company, such duty shall be limited or eliminated to the fullest extent provided by Delaware Law.  As examples, but not as limitations:

(i)      any Partner may compete with the Company (except as specified in Article XV ), and, to the extent approved in accordance with Article VII , enter into any contract or agreement with the Company;

(ii)      except to the extent expressly set forth to the contrary herein, each Partner may act and make decisions in its own interest;

(iii)      Lateral Opportunities are the only business opportunities required to be offered to the Company by any Partner;

(iv)      a Partner shall be deemed to have complied with its Partner duty of good faith and fair dealing with respect to the Company so long as it has complied with this Agreement with respect to all of its Lateral Opportunities; and

(v)      to the extent that a Partner owes any fiduciary, quasi-fiduciary or other duty to the Company or any other Partner, such Partner may rely and will be protected in acting or refraining from acting upon the opinions and reports of legal counsel, accountants, appraisers, management consultants, investment bankers and engineers selected by it to the extent that such Partner reasonably believes that the matters covered by such opinions and reports are within such Person’s professional or expert competence, and such Partner’s act or omission in reliance thereon shall be conclusively presumed to have been done or omitted in good faith and in accordance with such duty.

(c)      The duties, obligations and other responsibilities of the Partners to the Company and the other Partners (whether express or implied, created by this Agreement, by Law or otherwise) are the duties, obligations and responsibilities of the individual Partners and not of their Affiliates who are not otherwise Partners.  The existence of the Company does not create any duties, obligations or other responsibilities of any Partner’s Affiliate (who is not a Partner) to any other Partner.  To the extent that this Agreement requires any Affiliate (who is not a Partner) of any Partner to take any action or refrain from taking any action, such Partner agrees to use its best efforts to cause such Affiliate to take such action or refrain from taking such action, as applicable.

3.1       Initial Partners . The initial Partners of the Company are Oiltanking, TEPPCO and Enterprise.

3.2       Partnership Interests . The Partners agree that each Partner’s Partnership Interest will be that which is set forth in Exhibit A , as amended from time to time in accordance with the terms of this Agreement.

3.3       Representations and Warranties . As of the Effective Date, each Partner hereby represents and warrants to the Company and to each other Partner that:

(a)      it is duly formed, validly existing and (if applicable) in good standing under the Laws of the state of its formation, and if required by Laws, is duly qualified to do business and (if applicable) in good standing in the jurisdiction of its principal place of business (if not formed therein);

(b)      it has full corporate, limited liability company, partnership, trust, or other applicable power and authority to execute and deliver this Agreement and to perform its obligations hereunder and all necessary actions by the board of directors, shareholders,

managers, members, partners, trustees, beneficiaries, or other Persons necessary for the due authorization, execution, delivery, and performance of this Agreement by that Partner have been duly taken;

(c)      it has duly executed and delivered this Agreement, and this Agreement is enforceable against such Partner in accordance with its terms, subject to bankruptcy, moratorium, insolvency and other Laws generally affecting creditors’ rights and general principles of equity (whether applied in a court of law or equity);

(d)      its authorization, execution, delivery and performance of this Agreement does not conflict with any material obligation under any other material agreement or arrangement to which it is a party or by which it is bound; and

(e)      it (i) has been furnished with or given adequate access to such information about the Company and its Partnership Interest as such Partner has requested, (ii) has made its own independent inquiry and investigation into, and based thereon, has formed an independent judgment concerning, the Company and such Partner’s Partnership Interest therein, (iii) (x) has adequate means of providing for its current needs and possible individual contingencies, (y) is able to bear the economic risks of this investment, and (z) has a sufficient net worth to sustain a loss of its entire investment in the Company in the event such loss should occur, (iv) has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of an investment in the Company, (v) is an “ accredited investor ” within the meaning of Regulation D of the Securities Act of 1933 and (vi) understands and agrees that, except where required by applicable Law, its Partnership Interest will not be sold, pledged, hypothecated or otherwise transferred except in accordance with the terms of this Agreement and pursuant to an applicable exemption from registration under the Securities Act of 1933 and other applicable securities Laws.  

3.4       Transfers, Transfer Restrictions and Changes of Control . A Party may Transfer all or part of a Partnership Interest only in accordance with applicable Laws and the provisions of this Agreement, including the following provisions of this Section 3.4 .  Any purported Transfer in breach of the terms of this Agreement will be null and void ab initio , and the Company will not recognize any such prohibited Transfer.

(a)       Effects of Attempted or Permitted Transfers .

(i)      Except as otherwise provided in this Agreement or as required by applicable Laws, a Transfer of a Partnership Interest will be effective only to give the Transferee the right to receive the share of allocations and distributions to which the Transferor would otherwise be entitled, and no Transferee of a Partnership Interest will have the unilateral right to become a Substituted Partner.

(ii)      Unless and until a Transferee is admitted as a Substituted Partner as set forth in Section 3.4(a)(iii) (and except to the extent required by applicable Laws), (x) the Transferee will have no right to exercise any of the powers, rights and privileges of a Partner hereunder other than to receive its share of allocations

and distributions pursuant to Section 3.4(a)(i) , and (y) the Party who has Transferred all or any part of its Partnership Interest to such Transferee, until the Transferee is admitted as a Substituted Partner (1) will remain a Partner with respect to such Partnership Interest and (2) will release, indemnify, defend (upon request) and hold the Company and the other Partners harmless from and against any claims with respect to such attempted Transfer.

(iii)      Subject to compliance with the terms and conditions of Sections 3.4 and 3.5 , a Transferee may become a Substituted Partner if the Transferee agrees in writing to be bound by all the terms and conditions, as then in effect, of this Agreement.

(iv)      At the time all of the provisions of this Section 3.4 have been complied with: (x) a Substituted Partner will have all of the powers, rights, privileges, duties, obligations and liabilities of a Partner, as provided in this Agreement and by applicable Laws, to the extent of the Partnership Interest so Transferred; and (y) if the Substituted Partner has Sufficient Net Worth immediately prior to the applicable Transfer, the Partner who Transferred the Partnership Interest will be relieved of all of the obligations and liabilities with respect to such Partnership Interest; provided , that such Transferring Partner will remain fully liable for all liabilities and obligations relating to such Partnership Interest that accrued prior to such Transfer, including the obligation to make its proportionate share of the Initial Facilities Capital Contributions and any other Capital Contributions such Partner agreed to or was otherwise obligated to make.

(v)      Neither the Company nor any of the Partners will be bound or otherwise affected by any Transfer of any Partnership Interest of which such Person has not received notice pursuant to Section 3.4(h) .

(vi)      The Company may, in its reasonable discretion, charge a Partner a reasonable fee to cover the administrative expenses necessary to effect the Transfer of all or part of such Partner’s Partnership Interest.

(vii)      In the absence of a Transferee becoming a Substituted Partner of a Transferor (as provided under this Agreement), any payment by the Company to the Transferor will acquit the Company, its Subsidiaries and the Partners of all liability to any other Persons who may be interested in such payment by reason of a Transfer by such Partner.

(b)       General Transfer Restrictions .  Notwithstanding any provision in this Agreement to the contrary, no Party will Transfer its rights or obligations arising from or related to this Agreement, any Partnership Interest, or any interest therein:

(i)      if such Transfer would result in the violation of Laws, including any obligation under the Act or the obligation to file a registration statement, or have an applicable exemption from registration under, the Securities Act of 1933

or any other applicable securities Laws or materially change the regulatory scheme in which the Company operates;

(ii)      (or take or omit any action, filing, election, or other action which could result in a deemed Transfer) if such Transfer (either considered alone or in the aggregate with prior Transfers by the same Party or any other Parties) could reasonably be expected to result in (x) the termination of the Company for federal income tax purposes under Section 708 of the Code at any time after six months have elapsed after the Commencement Date or (y) the Company being taxed as a corporation or otherwise being taxed as an entity for federal income tax purposes;

(iii)      (except with respect to a Foreclosure Transfer) if such Person is in Default; and

(iv)      (other than Affiliate Transfers permitted under Section 3.4(d) and Foreclosure Transfers permitted under Section 3.4(j) ) if written consent of a Majority Interest has not been obtained (which consent may be delayed or withheld within each Eligible Partner’s sole discretion); provided , that no such consent will be required for any Transfer with respect to which the Transferring Partner has complied with the right of first refusal provisions in Section 3.4(e) .

(c)       Admission as a Partner .  Notwithstanding that a Transfer is otherwise permitted under, or consented to by the Eligible Partners in accordance with, the terms and conditions of this Section 3.4 , a Transferee shall only be admitted as a Substituted Partner if (i) such Transfer is expressly provided for herein (i.e., Affiliate Transfers permitted under Section 3.4(d) and Foreclosure Transfers permitted under Section 3.4(j) ), (ii) Transfers with respect to which the Transferring Partner has complied with the right of first refusal provisions in Section 3.4(e) or (iii) with the express written consent or agreement of a Unanimous Interest.

(d)       Affiliate Transfers .  Subject to the limitations set forth in Sections 3.4(b), (f) and (h) and the Transferee unconditionally assuming (by operation of Law or otherwise) all of the Transferor’s post-Transfer obligations under this Agreement, any Partner may Transfer any or all of its Partnership Interest to an Affiliate of such Partner which at the time of the Transfer is intended by such Partner in good faith to remain an Affiliate of such Partner and is of Sufficient Net Worth or whose obligations under this Agreement are guaranteed by an entity of Sufficient Net Worth, in which event such Transferee will be admitted as a Substituted Partner without any further consent or approval by the Company or any of the Partners and the Partner who Transferred the Partnership Interest will be relieved of all of the obligations and liabilities with respect to such Partnership Interest; provided , that such Transferring Partner will remain fully liable for all liabilities and obligations relating to such Partnership Interest that accrued prior to such Transfer, including the obligation to make its proportionate share of the Initial Facilities Capital Contributions and any other Capital Contributions such Partner agreed to or was otherwise obligated to make; and provided further , that, (i) if the Transferor’s Partnership Interest is supported by a guaranty, the guaranty must apply to the Transferee and its Partnership Interest and (ii) the Transfer was made for a valid business purpose

and not with a view to circumvent the Transfer restrictions or Change of Control provisions contained in this Agreement.

(e)       Right of First Refusal .

(i)      Except with respect to Affiliate Transfers permitted under Section 3.4(d) and Foreclosure Transfers permitted under Section 3.4(j) , any Party desiring to Transfer all or any portion of its interest in the Company (a “ Transferring Party ”) to a ready, willing and able Transferee (or Transferring of all or any portion of such interest by operation of Law or otherwise) must first offer to Transfer the portion of such interest that it desires to Transfer (collectively, the “ Subject Interest ”) to the other Partners (the “ Non-Transferring Partners ”) as a group based upon the same terms and conditions (including with respect to representations, warranties and indemnities, if any) as those under which, and for the same value (determined, if applicable, in accordance with Sections 3.4(e)(iv) , (v) or (vi) ) that, the Transferring Party desires to Transfer the Subject Interest to such ready, willing and able Transferee.  Such offer will be made by a good faith written offer (the “ Offer Notice ”) to transfer all of the Subject Interest and must contain a complete description of the transaction, including any other transactions on which such transaction is contingent (the “ Proposed Transaction ”), in which the Transferring Party proposes to Transfer the Subject Interest, including the name of the ready, willing and able Transferee (including, if applicable, the name of the Person ultimately Controlling such Transferee, if known), the known or anticipated closing date of the Proposed Transaction, the consideration, if any, specified for the Subject Interest (if there is no consideration, the Offer Notice will state as such), and any other material terms and conditions of the Proposed Transaction (including, to the extent the Transferring Party is not prohibited from making such disclosure, the terms of any other transactions contingent on such transaction (or on which such transaction is contingent), provided , that the Transferring Party will not, and will not permit its Affiliates who are not Partners to, agree to keep confidential the terms of any such contingent transaction primarily to circumvent the requirement in this clause).  Each Non-Transferring Partner will have 60 Days (as extended pursuant to Sections 3.4(e)(iv), (v) and (vi) , the “ Option Period ”) after its receipt of the Offer Notice within which to elect to acquire all of such Subject Interest upon the terms and conditions contained in the Offer Notice or determined in accordance with 3.4(e)(iv), (v) and (vi) .  If, within the Option Period, one or more Non-Transferring Partners elect to acquire such Subject Interest, then (1) such Non-Transferring Partner(s) will each deliver its own separate written notice to the Transferring Party and to the other Non-Transferring Partner(s) during such period that expresses such desire to purchase the Subject Interest (each, an “ Acceptance Notice ”) and (2) such Non-Transferring Partner(s) and the Transferring Party will use good faith commercially reasonable efforts to close such transaction in accordance with Section 3.4(a)(i) no later than the later to occur of (x) the known or anticipated closing date set forth in the Notice Offer or (y) 60 Days after the last Day of the Option Period.  If the Non-Transferring Partners and the Transferring Party each used good faith, commercially reasonable efforts to promptly close such transaction, but they do not close such transaction

within 90 Days after the last Day of the Option Period, the Transferring Party may proceed with the closing of the Proposed Transaction.

(ii)      If any Non-Transferring Partner does not elect to acquire its proportionate share of the Subject Interest, each of the remaining Non-Transferring Partners will have the right to acquire, under the terms and conditions set forth in this Section 3.4(e) , a proportionate portion of the remaining Subject Interest based on the relation of its Partnership Interest to the Partnership Interests of all Non-Transferring Partners desiring to acquire a portion of such share of the Subject Interest.  The right herein created in favor of the Non-Transferring Partners as a group is an option to acquire all, or none, of the Subject Interest offered for sale by the Transferring Party.  If all the Non-Transferring Partners elect to purchase the Subject Interest, unless otherwise agreed, each such Non-Transferring Partner will purchase a pro-rata portion of the Subject Interest based on its respective Partnership Interest.  If the Non-Transferring Partners as a group decline to acquire all of the Subject Interest of the Transferring Party in accordance with this Section 3.4(e) or if the Option Period has expired without delivery by any Non-Transferring Partner of an Acceptance Notice, the Transferring Party may Transfer such Subject Interest to the Transferee named in the Offer Notice delivered to the Non-Transferring Partners upon the terms described in such Offer Notice.  If such Transfer does not occur substantially in accordance with the terms of such Offer Notice, such Transfer will have been in violation of this Section 3.4(e) and be null and void ab initio and the Transferring Party and the Subject Interest will again be subject to the provisions of this Section 3.4(e) .

(iii)      Upon consummation of any Transfer made in accordance with this Section 3.4(e) (whether to a Partner or any other Person), such Transferee and its Partnership Interest will automatically become a party to and be bound by this Agreement and will thereafter have all of the rights of a Party and the obligations of a Partner hereunder; provided , however , that notwithstanding the foregoing, all Transfers pursuant to this Section 3.4(e) must also comply with and be governed by the other provisions of this Agreement, including any restrictions on Transfers therein and on any Transferee becoming a Substituted Partner, for such Transferee to have all of the rights of a Partner hereunder.

(iv)      If no consideration is to be paid in the Proposed Transaction for the Subject Interest, the Transferring Party will state as such in its Offer Notice and will state its good faith determination of the Fair Market Value of the Subject Interest, which will be the consideration for which the Subject Interest is offered to the Non-Transferring Partners.  If a Majority Interest disagrees with such determination, they will notify the Transferring Party of such disagreement within 20 Business Days of receiving the Offer Notice.  If such disagreement is not resolved within 20 Business Days after such notice to the Transferring Party, any Partner may cause such disagreement to be resolved by delivering notice (a “ Value Disagreement Notice ”) to the Transferring Party and the other Partners.  If more than one Partner delivers a Value Disagreement Notice, all such Notices shall be aggregated into one.  The Value Disagreement Notice must include the names of

three Appraisers (each of which must be independent from the  Company, the Partners and their respective Affiliates) proposed by the delivering Partner.  If more than one Partner delivers a Value Disagreement Notice, such Partners must together identify three Appraisers.  The Transferring Party must, within ten Days after receipt of the Value Disagreement Notice, choose one of the Appraisers listed on the Value Disagreement Notice to determine the Fair Market Value of the Subject Interest that is in dispute (the “ Appraised Value ”).  Subject to the provisions of Section 3.4(e)(vii) , the Partners delivering the Value Disagreement Notice(s) and the Transferring Party will share on an equal basis the costs of the designated Appraiser.  The Transferring Partner and each applicable Non-Transferring Partner will promptly provide such Appraiser with all information each deems necessary or appropriate to determine such Appraised Value, and such Appraiser shall determine such Appraised Value within 30 Days after receipt of all such information.  If a Value Disagreement Notice is delivered, the Option Period will be extended until the date five Business Days after the disagreement described in such Value Disagreement Notice is resolved.  The consideration to be paid by the applicable Non-Transferring Partners for the Subject Interest then will be a cash amount equal to the Appraised Value of the Subject Interest, as determined by the Appraiser.

(v)      If the Proposed Transaction (including, to the extent the Transferring Party is not prohibited from making such disclosure, the terms of any other transactions contingent on such transaction (or on which such transaction is contingent), provided , that the Transferring Party will not, and will not permit its Affiliates to, agree to keep confidential the terms of any such contingent transaction primarily to circumvent the requirement in this clause) contemplates the transfer of any asset, property, interest or right in addition to the Subject Interest to the proposed Transferee or its Affiliate, then the Transferring Party must include in its Offer Notice its good faith determination of the Fair Market Value of the Subject Interest, which will be the consideration for which the Subject Interest is offered to the Non-Transferring Partners.  If a Majority Interest disagrees with such determination, they will notify the Transferring Party of such disagreement within 20 Business Days of receiving the Offer Notice.  If such disagreement is not resolved within 20 Business Days after such notice to the Transferring Party, any Partner may cause such disagreement to be resolved by delivering a Value Disagreement Notice to the Transferring Party and the other Partners.  If more than one Partner delivers a Value Disagreement Notice, all such Notices shall be aggregated into one.  The Value Disagreement Notice must include the names of three Appraisers (each of which must be independent from the Company, the Partners and their respective Affiliates) proposed by the delivering Partner.  If more than one Partner delivers a Value Disagreement Notice, such Partners must together identify three Appraisers.  The Transferring Party must, within ten Days after receipt of the Value Disagreement Notice, choose one of the Appraisers listed on the Value Disagreement Notice to determine the Appraised Value.  Subject to the provisions of Section 3.4(e)(vii) , the Partners delivering the Value Disagreement Notice(s) and the Transferring Party will share on an equal basis the costs of the designated Appraiser.  The Transferring Party and each applicable

Non-Transferring Partner will promptly provide such Appraiser with all information necessary or appropriate to determine the Appraised Value, and such Appraiser shall determine the Appraised Value within 30 Days after receipt of all such information.  If a Value Disagreement Notice is delivered, the Option Period will be extended until the date five Business Days after the disagreement described in such Value Disagreement Notice is resolved.  The consideration to be paid by the applicable Non-Transferring Partners for the Subject Interest then will be a cash amount equal to the Appraised Value of the Subject Interest, as determined by the Appraiser.

(vi)      If any portion of the consideration set forth in the Offer Notice is to be paid in a form other than cash or cash equivalents (including real or personal property, promissory notes, securities, contractual benefits, assumption of liabilities or anything else of value) (“ Non-Cash Consideration ”), the Transferring Party will state in its Offer Notice its good faith determination of the Fair Market Value of the Subject Interest, which will be the consideration for which the Subject Interest is offered to the Non-Transferring Partners.  If a Majority Interest disagrees with such determination, they will notify the Transferring Party of such disagreement within 20 Business Days of receiving the Offer Notice.  If such disagreement is not resolved within 20 Business Days after such notice to the Transferring Party, any Partner may cause such disagreement to be resolved by delivering a Value Disagreement Notice to the Transferring Party and the other Partners.  If more than one Partner delivers a Value Disagreement Notice, all such Notices must be aggregated into one.  The Value Disagreement Notice must include the names of three Appraisers (each of which must be independent from the Company, the Partners and their respective Affiliates) proposed by the delivering Partner.  If more than one Partner delivers a Value Disagreement Notice, such Partners must together identify three Appraisers.  The Transferring Party must, within ten Days after receipt of the Value Disagreement Notice, choose one of the Appraisers listed on the Value Disagreement Notice to determine the Appraised Value.  Subject to the provisions of Section 3.4(e)(vii) , the Partners delivering the Value Disagreement Notice(s) and the Transferring Party will share on an equal basis the costs of the designated Appraiser.  The Transferring Party and each applicable Non-Transferring Partner will promptly provide such Appraiser with all information that each deems necessary or appropriate to determine the Appraised Value, and such Appraiser shall determine the Appraised Value within 30 Days after receipt of all such information.  If a Value Disagreement Notice is delivered, the Option Period will be extended until the date five Business Days after the disagreement described in such Value Disagreement Notice is resolved.  The consideration to be paid by the applicable Non-Transferring Partners for the Subject Interest then will be a cash amount equal to the Appraised Value of the Subject Interest, as determined by the Appraisers.

(vii)      Any Transferring Party may withdraw its offer altogether (including to the original offeror) if the Appraised Value is less than 90% of the Fair Market Value stated in the Offer Notice, provided that in such case the Transferring Party will be solely responsible for the costs of the designated

Appraiser.  Absent fraud or manifest error, the Appraised Value determination will be final and binding and not subject to further appeal.

(f)       Right of Purchase Upon Change of Control .

(i)       Right of Purchase .

(A)      Subject to Sections 3.4(f)(i)(D) , if a Change of Control occurs with respect to any Party (the “ Affected Partner ”), then all other Partners as a group (the “ Non-Affected Partners ”) will have the right to purchase all of such Party’s interest in the Company (the “ Affected Interest ”) for the Fair Market Value of such interest either as stated in the Change of Control Notice or as determined, if applicable, in accordance with Section 3.4(f)(i)(C) .

(B)      If a Change of Control occurs with respect to any Party, such Affected Partner must, as soon as reasonably possible after the Change of Control, deliver to each Non-Affected Partner a written notice (the “ Change of Control Notice ”) containing the following information:  (1) the name of the Person ultimately Controlling such Party following the Change of Control as a result of the transaction and the relationship between such Person and the Affected Partner; (2) a description of the transaction constituting a Change of Control of such Partner, including such Partner’s good faith determination of (x) the total value of the transaction as a whole (to the extent that disclosure thereof is not prohibited by Law or by a confidentiality agreement, a waiver of which cannot reasonably be obtained) and (y) the Fair Market Value of the Affected Interest on the closing date of such transaction; and (3) the closing date of such transaction.

(C)      If a Majority Interest disagrees with the Affected Partner’s determination of any value calculated in the Change of Control Notice, they will notify the Affected Partner of such disagreement within ten Business Days of the Change of Control Notice Date.  If such disagreement is not resolved within ten Business Days after such notice to the Affected Partner, any Partner may cause such disagreement to be resolved by delivering a Value Disagreement Notice to the Affected Party and the other Partners.  The Value Disagreement Notice must include the names of three Appraisers (each of which must be independent from the delivering Partner and its Affiliates) proposed by the delivering Partner.  The Affected Party must, within ten days after receipt of the Value Disagreement Notice, choose one of the Appraisers listed on the Value Disagreement Notice to determine the Appraised Value.  The Non-Affected Partners and the Affected Partner will share on an equal basis the costs of the designated appraiser.  The Affected Partner and each Non-Affected Partner will promptly provide such Appraiser with all information that each deems necessary or appropriate to determine such

Appraised Value, and such Appraiser shall determine the Appraised Value within 30 Days after receipt of all such information.  If a Value Disagreement Notice is delivered, the Change of Control Option Period will be extended until the date five Business Days after the disagreement described on such Value Disagreement Notice is resolved.  The consideration to be paid by the applicable Non-Affected Partners for the Affected Interest then will be a cash amount equal to the Appraised Value of the Affected Interest, as determined by the resolution of the Appraiser.

(D)      The Non-Affected Partners will have 60 days (as extended pursuant to Section 3.4(f)(i)(C) , the “ Change of Control Option Period ”) after the Change of Control Notice Date within which to elect to acquire all of the Affected Interest pursuant to this Section 3.4(f)(i) .  If one or more Non-Affected Partners elects to acquire the Affected Interest by delivering notice within the Change of Control Option Period, then such Non-Affected Partner or Partners and the Affected Partner will use good faith, commercially reasonable efforts to close such Transfer no later than 60 days after the expiration of the Change of Control Option Period.  Subject to Section 3.4(g) , if the Non-Affected Partner(s) and the Affected Partner use good faith, commercially reasonable efforts to promptly close such Transfer, but do not close such Transfer within 90 days after the expiration of the Change of Control Option Period, the Non-Affected Partners’ rights to acquire the Affected Interest will terminate as of such 90th day.

(ii)      If a Non-Affected Partner does not elect to acquire its proportionate share of the Affected Interest, each of the remaining Non-Affected Partners will, subject to the terms and conditions contained in Section 3.4(f)(i) , have the right to acquire a proportionate portion of the remaining Affected Interest based on the relation of its Partnership Interest to the Partnership Interests of all Non-Affected Partners desiring to acquire a portion of such share of the Affected Interest.  The right herein created in favor of the Non-Affected Partners as a group is an option to acquire all, or none, of the Affected Interest.  If the Non-Affected Partners as a group decline to acquire all of the Affected Interest in accordance with this Section 3.4(f) or if the offer to sell contained in Section 3.4(f)(i) has expired, the right to acquire provided by this Section 3.4(f) will terminate.

(g)       Governmental Consents .  If any governmental consent or approval is required with respect to any Transfer, the Transferee will have a reasonable amount of time (not to exceed one year from the date upon which such Transfer would have been otherwise consummated in accordance with the terms of this Agreement) to obtain such consent or approval.  All Partners will use reasonable, good faith efforts to cooperate with the Transferee attempting to obtain, and to assist in timely obtaining, such consent or approval; provided that no Partner   will be required to incur any out-of-pocket costs in connection with such cooperation and assistance.  After the expiration of such waiting period, such Transferee will forfeit its rights to acquire the Partnership Interest subject to such proposed Transfer with respect to such specific transaction; provided , however , that

such forfeiture will not limit or otherwise affect the forfeiting Transferee’s rights with respect to any subsequent proposed Transfer.

(h)       Documentation; Validity of Transfer .  The Company may not recognize for any purpose any purported Transfer of all or any part of a Partnership Interest unless and until the applicable provisions of Section 3.4 have been satisfied and the Company has received, on behalf of the Company (with copies to each of the Non-Transferring Partners), a document substantially in the form attached hereto as Exhibit B executed by both the Transferor (or if the Transfer is on account of the death, incapacity, or liquidation of the Partner, its legal or authorized representative) and the Transferee.  Each Transfer and, if applicable, admission of a Substituted Partner complying with the provisions of Section 3.4 is effective against the Company as of the first Business Day of the calendar month immediately succeeding the month in which (i) the Company receives the documents required by this Section 3.4(h) reflecting such Transfer and (ii) all other requirements of Section 3.4 have been met.

(i)       Closing of a Transfer .  At the closing of the Transfer of a Partnership Interest pursuant to this Agreement, (i) the Transferee will deliver to the Transferor the full consideration agreed upon (except as otherwise identified in the Offer Notice or as agreed to between the Transferor and the Transferee) and (ii) the Transferor will Transfer its Partnership Interest to the Transferee free and clear of any and all liens, claims, security interests and other encumbrances, other than those created by this Agreement or any loan documents evidencing indebtedness of the Company for borrowed money.  Any Partnership Interest transfer or similar taxes involved in such sale will be the sole responsibility of the Transferor, and the Transferor will provide the Transferee with such evidence of the Transferor’s authority to Transfer hereunder and such tax lien waivers and similar instruments as the Transferee may reasonably request.

(j)       Pledge; Foreclosure Transfers .  The Parties expressly acknowledge and agree that each Party will grant a Security Interest in its Partnership Interests pursuant to Section 16.18 .  Foreclosure Transfers with respect to either such Security Interest are permitted hereunder without the consent of the Partners, and any such proper Foreclosure Transfer shall entitle a Partner that forecloses on the underlying Security Interest to become a Substituted Partner.

(k)       Security Interest Transfers .  Notwithstanding anything to the contrary contained herein, any Party has the right to grant a Security Interest, in connection with any bona fide financing transaction, in any right or obligation such Party may have arising out of or related to this Agreement, the Company, or such Party’s Partnership Interest, or any interest herein or therein, and make a Transfer in connection with any such Security Interest; provided , however, that (i) no such Security Interest may be created in violation of Sections 3.4(a)(i) or 3.4(b)(i), (ii) the Company must be notified of any such Security Interest promptly after the creation thereof, and (iii) except as set forth to the contrary in Section 3.4(j) , any Foreclosure Transfer with respect to a Security Interest in a Partnership Interest shall entitle a non-Partner that forecloses on the underlying Security Interest only to become a Transferee and not a Substituted Partner.  If such foreclosing Person is already a Partner, such Partner’s status as a Partner will

remain unchanged but its Partnership Interest will be increased by the Partnership Interest acquired through the Foreclosure Transfer.

3.5       Possible Additional Restrictions on Transfer . Notwithstanding anything to the contrary contained in this Agreement, in the event of (a) the enactment (or imminent enactment) of any legislation, (b) the publication of any temporary or final regulation by the Treasury Department (“ Treasury Regulation ”), (c) any ruling by the Service, or (d) any judicial decision that in any such case, in the opinion of tax counsel to the Company, would result in the taxation of the Company for federal income tax purposes as a corporation or would otherwise subject the Company to being taxed as an entity for federal income tax purposes, this Agreement will be deemed to impose such restrictions on the Transfer of a Partnership Interest as may be required, in the opinion of counsel to the Company, to prevent the Company from being taxed as a corporation or otherwise being taxed as an entity for federal income tax purposes, and the Partners hereby agree thereafter to amend this Agreement as necessary or appropriate to impose such restrictions.

3.6       Additional Partnership Interests . Additional Partnership Interests may be created and issued to non-Partners and to existing Partners; provided that, any non-Partner receiving a Partnership Interest in such issuance shall be admitted to the Company as a Partner, only upon the vote of a Unanimous Non-Defaulting Interest and subject to the terms and conditions of this Agreement.  Such admission must comply with any additional terms and conditions that a Unanimous Non-Defaulting Interest may in their sole discretion determine at the time of admission.  A document, in a form acceptable to a Unanimous Non-Defaulting Interest, will specify the terms of admission or issuance and will include, among other things, the Partnership Interest applicable thereto.  Any such admission of a new Partner also must comply with the provisions of Section 3.4(a)(iii) .  The provisions of this Section 3.6 will not apply to Transfers of Partnership Interests.

3.7       Information .

(a)      Except as specifically set forth to the contrary in Section 3.7(b) , no Person other than a Partner is entitled to any information with respect to the Company unless otherwise approved by a Majority Interest.

(b)      The Parties acknowledge that, from time to time, they may receive information from or regarding the Company, its Subsidiaries, its customers or any other Partner or their Affiliates in the nature of trade secrets or secret or proprietary information or information that is otherwise confidential, the release of which may be damaging to the Company, its Subsidiaries, the Partner or their Affiliates, as applicable, or Persons with which they do business (“ Confidential Information ”).  Each Party will, and will cause its Affiliates who are not Partners to, (A) hold in strict confidence any such Confidential Information it receives and (B) not disclose such Confidential Information to any Person other than another Partner, except for disclosures: (i) to comply with applicable Laws or, rules or regulations of any applicable securities exchange or market; (ii) under compulsion of judicial process, including to Arbitrators in any Proceeding involving the Partners; (iii) in connection with any proposed Transfer of all or part of a Partnership Interest in the Company of such Party or the proposed sale of

all or substantially all of such Party or its direct or indirect parent, to Affiliates, advisers or representatives of the Partner or Persons to which such interest may be Transferred as permitted by this Agreement, but only if the recipients of such Confidential Information have agreed in writing to be bound by confidentiality provisions that are no less stringent than those set forth in this Section 3.7(b); (iv) of Confidential Information that such Party also has received from a source independent of the Company or its Subsidiaries and that such Party reasonably believes such source obtained such information without breach of any obligation of confidentiality; (v) of Confidential Information obtained prior to the formation of the Company, provided that this sub-clause (v) will not relieve any Partner or any of its Affiliates from any obligations it may have to any other Partner or any of its Affiliates under any existing confidentiality agreement; (vi) to members, partners, officers, employees, Affiliates, lenders, accountants and other representatives of such Partner with a need to know such Confidential Information, provided that such Partner will be responsible for such representatives’ use and disclosure of any such Confidential Information; or (vii) of public information.  The confidentiality obligations set forth in this Section 3.7(b) will terminate with respect to any Confidential Information five years after disclosure of such information to the Company or the Partners (or possibly longer if covered by separate confidentiality obligations).  No Partner may (directly or indirectly) permit the use of Confidential Information in a manner adverse to the interests of the Company or the Partner disclosing such Information, except as permitted by this Section 3.7(b) .  No rights in Confidential Information are transferred or will be deemed to be transferred upon any disclosure hereunder.  The Parties acknowledge that a breach of the provisions of this Section 3.7(b) may cause irreparable injury to the Company or its Subsidiaries or another Partner for which monetary damages are inadequate, difficult to compute, or both.  Accordingly, the Parties agree that the provisions of this Section 3.7(b) may be enforced by injunctive action or specific performance.

(c)      The Parties acknowledge that, from time to time, the Company and its Subsidiaries may need information from any or all of such Parties for various reasons, including compliance with Laws.  Each Party will provide to the Company and its Subsidiaries all information reasonably requested by the Company and its Subsidiaries within a reasonable amount of time from the date such Party receives such request; provided , however , that no Party will be obligated to provide such information to the Company and its Subsidiaries to the extent such disclosure (i) could reasonably be expected to result in the breach or violation of any contractual obligation (if a waiver of such restriction cannot reasonably be obtained) or applicable Law or (ii) involves secret, confidential or proprietary information.

3.8       Liability to Third Parties . Except as required by the Act or as otherwise expressly agreed to in writing, no Partner will be liable to any Person (including any third party or to any other Partner) (a) as the result of any act or omission of another Partner or (b) for losses, liabilities or obligations of the Company or any of its Subsidiaries.  The Company will use its best efforts to cause all contracts, leases, subleases, notes, deeds of trust and other agreements to which it is a party to contain an appropriate provision limiting the claims of all parties thereto to the assets of the Company and expressly waiving any rights of such parties to proceed against the Partners, jointly or severally.

3.9       Dissociation . Notwithstanding the fact that a Party may dissociate (which must be accomplished by delivery of written notice to the Company) by express will at any time pursuant to Sections 15-103(b)(4) and 15-602(a) of the Act, any dissociation by any Party without the express prior written consent of all other Parties will be wrongful and a breach of this Agreement (as set forth in Section 15-602(b) of the Act).  If any Party wrongfully dissociates or attempts to dissociate:

(a)      such Party will be liable to the Company for its allocable share of all Initial Facilities Capital Contributions required prior to and following such dissociation, resignation or withdrawal, regardless of whether the relevant Capital Call Notice has been delivered prior to or after such  dissociation, resignation or withdrawal;

(b)      such Party will be liable to the Company and the other Partners for all Losses caused by such dissociation, resignation or withdrawal, including   any incidental, indirect, special, exemplary, punitive, or consequential damages of any kind or nature;

(c)      such Party will be a non-Partner Party, except that (i) such Party will not be entitled to receive distributions of any kind or character from the Company, (ii) such Party will not be allocated any income or loss by the Company and (iii) such Party’s former Partnership Interest will be considered cancelled for all purposes until the end of the term of the Company; and

(d)      such Party waives its right to statutory buyout of its Partnership Interest (to which it might otherwise have been entitled under Section 15-701 of the Act), provided that if (and only if) such Party is held in a final, nonappealable judgment to be entitled to buyout of its Partnership Interest, such buyout will be for 2/3 of the Fair Market Value (determined in the Company’s reasonable judgment, taking into account all factors reasonably deemed relevant by the Company) of such Partnership Interest (with such 1/3 discount, as is agreed by the Parties hereto, reflecting the damage done to the Company by such wrongful dissociation) and will be payable solely by an unsecured promissory note issued by the Company (i) with a term of 10 years, non-compounding interest payable annually at a rate of interest reasonably determined by the Company and the entire principal amount thereof payable upon maturity, (ii) with no covenants of the Company other than the obligation to pay interest annually and principal upon maturity and (iii) with a provision stating that such promissory note is solely an obligation of the Company and expressly non-recourse to the Partners.

Notwithstanding anything to the contrary herein, the dissociation (wrongful or otherwise) of any Party will not cause the dissolution or winding up of the Company.  For the avoidance of doubt, a Transfer of a Partnership Interest in accordance with Section 3.4 will be deemed not to constitute a dissociation, resignation or withdrawal by a Party.

3.10       Lack of Partner Authority . No Partner has the authority to act on behalf of any other Partner.  No Partner has the authority or power to act as agent for or on behalf of the Company, do any act that would be binding on the Company or any of its Subsidiaries, or incur any expenditure on behalf of the Company or any of its Subsidiaries, unless expressly authorized to do so in writing by the Company.

3.11       Not a Security . The Partnership Interests are deemed not to be a “security” under the Uniform Commercial Code of Texas, Delaware or any other relevant jurisdiction.

3.12       Party in Default . Except to the extent required by applicable Laws, a Party in Default does not have any voting rights or rights to distributions of a Partner in the Company or under this Agreement (and shall not be an Eligible Partner) during the existence and continuation of such Default, but a Party in Default remains primarily obligated for, and subject to, its obligations under this Agreement.

4.1       Initial Facilities Capital Contributions . Each Party has made or will make (as applicable) the Capital Contributions described in this Section 4.1 (the “ Initial Facilities Capital Contributions ”).

(a)      As of the execution of this Agreement, each Partner has contributed to the Company the amounts set forth below:

(b)      Solely to the extent that the Company does not have cash immediately available to satisfy same, the Partners will contribute cash in amounts equal to their allocable share (determined by relative Partnership Interests) of 100% of all amounts for costs and expenses incurred on behalf of the Company related to the feasibility study for TOPS, the formation of the Company and all amounts to be incurred by the Company to design, construct, install and place in service the Initial Facilities as necessary to timely and satisfactorily fulfill all of the Company’s obligations under the Throughput Agreements, which contributions will be made as necessary or appropriate subject to Section 4.1(d) (in the Construction Manager’s reasonable determination) to allow the Company to timely pay such amounts as they become due.   An estimate of the contributions necessary or appropriate under this Section 4.1(b) is set forth on Schedule 3 .

(c)      If the Construction Manager determines from time to time in its reasonable discretion that any Capital Contribution described in Section 4.1(b) may be necessary or appropriate to timely complete the Initial Facilities, then the Construction Manager will send written notice (a “ Capital Call Notice ”) to the Partners specifying (i) the aggregate amount of such Capital Contribution reasonably and in good faith deemed necessary or appropriate by the Construction Manager and each Partner’s allocable share thereof, (ii) the actual expenditures incurred through the date of such notice, broken out by project or obligation and amounts set forth in the applicable Budget for the project or obligation for which the Capital Contribution is being requested, and (iii) the date by which such Capital Contributions must be made to the Company by the Partners (which date will not be less than ten Business Days from the date on which the Capital Call Notice is sent).  Subject to Section 4.1(d) , each Partner must promptly thereafter

contribute cash to the Company in an amount equal to such Partner’s allocable share of the amount of such Capital Contribution on or before the date specified in such Capital Call Notice.

(d)      If a Capital Call Notice is delivered requesting Capital Contributions (i) for line item amounts exceeding those set forth in the applicable Budget by 10% or $2,500,000 or (ii) not provided for in a Budget and in excess of $2,500,000   (either of (i) or (ii), an “ Unbudgeted Capital Call ”), the Construction Manager must set forth in its Capital Call Notice a detailed explanation for the variance from the Budget.  If any Partner reasonably and in good faith believes that the excess amounts so requested are (A) due to the gross negligence or willful misconduct (which expressly includes any intentional breach of a material provision contained in the Construction Agreement) of the Construction Manager or (B) not reasonably necessary or appropriate for completion of the Initial Facilities, such Partner may dispute the excess Capital Contribution so requested with written notice, stating the reason(s) for such belief (a “ Capital Call Dispute Notice ”), to the Construction Manager and the other Partners within 10 Business Days of receipt of the relevant Capital Call Notice (“ Capital Call Dispute Period ”).  If a Partner does timely deliver a Capital Call Dispute Notice, such dispute (the “ Capital Call Dispute ”) shall be determined in accordance with Section 4.1(f) .

(e)      Notwithstanding the fact that a Partner has timely delivered a Capital Call Dispute Notice, such Partner will contribute to the Company the entire amount requested in such Capital Call Notice in accordance with the Capital Call Notice instruction.

(f)       Resolution of Capital Call Disputes .

(i)       Disputes as to Whether an Amount is Necessary .  If a Capital Call Dispute Notice has been timely delivered and such Capital Call Dispute Notice alleges that an Unbudgeted Capital Call is not reasonably necessary or appropriate for completion of the Initial Facilities, then the Partners will refer such dispute to the Determining Engineer to resolve.  The sole matter to be determined by the Determining Engineer in any such dispute is whether the Unbudgeted Capital Call is, or is not, reasonably necessary or appropriate for completion of the Initial Facilities.  The Partners will use (and, if the Construction Manager is under the Control of a Partner, such Partner will cause the Construction Manager to use) commercially reasonable efforts to cooperate with the Determining Engineer so that the Determining Engineer may reach its decision as quickly as possible.  In connection with the resolution of any such Capital Call Dispute, the Company will agree to indemnify the Determining Engineer to the extent reasonably requested by the Determining Engineer.  All costs incurred by any Partner in connection with any such Capital Call Dispute will be for the account of such Partner.  All amounts paid to the Determining Engineer in connection with any such Capital Call Dispute shall be paid by the Company.  The determination of any such Capital Call Dispute by the Determining Engineer will be final and each Partner hereby waives its ability to appeal such determination, whether through resort to the courts or otherwise.  If the resolution of the Capital Call Dispute provides that all or any portion of the Unbudgeted Capital Call was not reasonably necessary or

appropriate for completion of the Initial Facilities, the Partners shall instruct the Construction Manager to revise the Capital Call Notice accordingly, and to the extent that such distribution would not breach any of the Company’s material third party agreements (including loan agreements), the Company shall return such excess amounts contributed to the applicable contributing Partners.

(ii)       Disputes as to Whether an Amount was Caused by the Construction Manager .  If a Capital Call Dispute Notice has been timely delivered and such Capital Call Dispute Notice alleges that an Unbudgeted Capital Call is due to the gross negligence or willful misconduct (which expressly includes any intentional breach of a material provision contained in the Construction Agreement) of the Construction Manager, then such dispute will be resolved according to Section 16.5 .   If the resolution of the Capital Call Dispute provides that all or any portion of the Unbudgeted Capital Call was due to the gross negligence or willful misconduct of the Construction Manager, then the Company shall promptly take action to recover such funds from the Construction Manager, together with interest from the date of payment thereof as set forth in the Construction Agreement.  To the extent that such distribution would not breach any of the Company’s material third party agreements (including loan agreements), the Company shall distribute all such recovered funds to the Partners that contributed funds with respect to the relevant Unbudgeted Capital Call.

(g)      Each Capital Contribution made will be credited to the contributing Party’s Capital Account (other than any amounts returned pursuant to Section 4.1(f)) .

4.2       Subsequent Contributions . No Party will be required to make any Capital Contributions other than the Initial Facilities Capital Contributions and any other Capital Contribution to which such Party has agreed in writing (including by approval of written resolutions).  Except to the extent set forth in Article XV , no Party may make any Capital Contribution other than the Initial Facilities Capital Contributions unless such Capital Contribution has been approved by a Unanimous Non-Defaulting Interest.

4.3       Failure to Contribute .

(a)      If a Party does not contribute by the required time all or any portion of a Capital Contribution such Party (the “ Delinquent Party ”) is required to make under Section 4.1 or to which such Party agreed, any one or more Non-Delinquent Partner may advance the entire amount of the Delinquent Party’s Capital Contribution that has not been contributed, with each Non-Delinquent Partner electing to participate in such advance making its share of such advance in proportion to its Partnership Interest (without taking into account the Partnership Interest of the Delinquent Party) or in such other percentages as the participating Partners may agree.  Each Non-Delinquent Partner who makes such an advance on behalf of a Delinquent Party will have the right to designate the extent to which such advance will (x) constitute a loan to the Delinquent Party and/or (y) result in an immediate adjustment of the Partnership Interests of the Delinquent Party and the Non-Delinquent Partner making such election; provided , however , that if the advancing Non-Delinquent Partner does not notify the Company of

its election to have all, or any portion of, such advance treated as a loan to the Delinquent Party, in writing, at the time the advance is made, then such advance will automatically result in an immediate adjustment of the Partnership Interests.

(i)      To the extent one or more Non-Delinquent Partners does not elect to have an advance made pursuant to Section 4.3(a) treated as a loan to the Delinquent Party, or affirmatively elects to have such advance result in an adjustment of the Partnership Interests, the Company will automatically adjust the Partnership Interest for each Partner to equal the percentage obtained by dividing (A) the Capital Contributions made by such Partner (including any Capital Contribution made by such Partner under this Section 4.3 multiplied by two and twenty-five hundredths (2.25); provided that the Delinquent Party shall forfeit from its Capital Contributions an amount equal to the amount of the Delinquent Party’s Capital Contribution that has not been contributed and that has not been designated as a loan multiplied by one and twenty-five hundredths (1.25)) by (B) the aggregate Capital Contributions made by all Partners (including all Capital Contributions made under this Section ).  Upon the adjustment of the Partnership Interests in the manner set forth in the preceding sentence, Exhibit A will be deemed to be amended to reflect such adjusted Partnership Interests.  Notwithstanding the foregoing, the Delinquent Party will have the right to re-acquire the interest in question from the advancing Non-Delinquent Partner within 30 Days following the date on which such Partnership Interest adjustment is made by paying the entire amount advanced by such Non-Delinquent Partner in return for such adjustment, plus interest thereon at a rate equal to the lesser of (A) the maximum, lawful interest rate, compounded monthly, that is then-currently permitted under applicable Law, or (B) 12% per annum.

(ii)      To the extent one or more Non-Delinquent Partners (the “ Lending Partner ,” whether one or more) elects to have an advance made pursuant to Section 4.3(a) constitute a loan to the Delinquent Party, such advance will have the following results (except to the extent otherwise agreed by the Lending Partner and the Delinquent Party, in each such Person’s sole discretion):

(A)      the sum advanced will constitute a loan from the Lending Partner to the Delinquent Party and a Capital Contribution of that sum to the Company by the Delinquent Party pursuant to the applicable provisions of this Agreement;

(B)      the principal balance of the loan and all accrued unpaid interest thereon (collectively, the “ Obligation ”) will be due and payable in whole no later than the tenth Business Day after the Day written demand requesting payment of the Obligation is made by the Lending Partner to the Delinquent Party; provided , however , that the Delinquent Party may prepay the Obligation in whole or in part at any time prior to the date due;

(C)      the amount lent will bear interest at the Default Interest Rate from the date on which the advance is deemed made until the date on

which the loan, together with all interest accrued thereon and all costs and expenses associated therewith (“ Costs ”), is repaid to the Lending Partner;

(D)      all distributions from the Company that otherwise would be made to the Delinquent Party (whether before or after dissolution of the Company) instead will be paid to the Lending Partner until the Obligation and any Costs have been paid in full to the Lending Partner (with payments being applied first to accrued and unpaid interest, second to Costs, and finally to principal);

(E)      the Lending Partner will have the right, in addition to the other rights and remedies granted to it pursuant to this Agreement or available to it at Law or in equity, to take any action (including court proceedings and exercising the rights of a secured party under the Uniform Commercial Code of any applicable State) that the Lending Partner may deem appropriate to obtain payment from the Delinquent Party of the Obligation and all Costs; and

(F)      initially, a loan by any Partner to another Partner as contemplated by this Section 4.3(a)(ii) will not be considered a Capital Contribution by the Lending Partner and will not increase the Capital Account balance of the Lending Partner.  Notwithstanding the foregoing, if the principal and interest of any such loan have not been repaid within one year from the date of the loan, the Lending Partner, at any time thereafter by giving written notice to the Company, may elect to have the unpaid principal and interest balance of such loan transferred to and increase such Lending Partner’s Capital Account with a corresponding decrease in the Capital Account of the Partner on whose behalf such loan was made.  Upon such transfer, the loan will be treated as a Capital Contribution and the Partnership Interest for each Partner will be automatically adjusted to equal the percentage obtained by dividing (A) the Capital Account of such Partner (including any Capital Contributions made on behalf of another Partner multiplied by two; provided that the Delinquent Party shall forfeit from its Capital Contributions an amount equal to the amount of the Delinquent Party’s Capital Contribution that has not been contributed and has not been designated as a loan) by (B) the aggregate Capital Accounts of all Partners (including all Capital Contributions made on behalf of other Partners). Upon the adjustment of the Partnership Interests in the manner set forth in the preceding sentence, Exhibit A will be deemed to be amended to reflect such adjusted Partnership Interests.

(b)      Notwithstanding the rights of Non-Delinquent Partners described in Section 4.3(a) , the Company, by a vote of a Majority Interest (where the Party in Default is not an Eligible Partner), will have the right to exercise the following remedies with respect to a Party in Default:

(i)      the Company may at any time take such action (including court proceedings) as the Company may deem appropriate to obtain payment by the Delinquent Party of the portion of the Delinquent Party’s Capital Contribution that is in Default, along with all Costs and expenses associated with the collection of such Delinquent Party’s Capital Contribution; and

(ii)      the Company may at any time exercise any other rights and remedies available at law or in equity.

(c)      For purposes of Section 4.3(b) above the rights of the Lending Partner shall be pari passu as among the Company and the Eligible Partners.

4.4       Return of Contributions . No Partner is entitled (a) to the return of any part of any Capital Contributions (other than any preferential or disproportionate distributions to the extent such distributions are expressly required to be returned by this Agreement) or (b) to be paid interest in respect of either its Capital Account or its Capital Contributions.  An unrepaid Capital Contribution is not a liability of the Company or its Subsidiaries or of any other Partner.  A Partner is not required to contribute or to lend any cash or property to the Company to enable the Company to return any other Partners’ Capital Contributions.

4.5       Capital Accounts . A separate capital account (“ Capital Account ”) will be established and maintained for each Party in accordance with the rules of Treasury Regulation section 1.704-1(b)(2)(iv) and the following terms and conditions:

(a)       Increases and Decreases .  Each Party’s Capital Account will be (i) increased by (A) the amount of cash or cash equivalents contributed by that Party to the Company as capital, (B) the Net Agreed Value of property contributed by that Party to the Company as capital, (C) the amount of any loans transferred by such Partner to its Capital Account pursuant to Section 4.3(a)(ii)(F) (contributions contemplated by subparagraphs (A), (B) and (C) will be referred to as “ Capital Contributions ”), and (D) allocations to that Party of Company income and gain (or items thereof), including income and gain exempt from tax and income and gain described in Treasury Regulation section 1.704-1(b)(2)(iv)(g), but excluding income and gain described in Treasury Regulation section 1.704-1(b)(4)(i); and (ii) will be decreased by (A) the amount of cash or cash equivalents distributed to that Party by the Company, (B) the Net Agreed Value of property distributed to that Party by the Company, and (C) allocations of Company losses and deductions (or items thereof), including losses and deductions described in Treasury Regulation section 1.704-1(b)(2)(iv)(g) (but excluding losses or deductions described in Treasury Regulation section 1.704-1(b)(4)(i) or (iii));

(b)       Method for Determining Income, Gain Or Loss and Deductions .  For purposes of computing the amount of any item of income, gain, loss or deduction to be reflected in the Parties’ Capital Accounts, the determination, recognition and classification of any such item will be the same as its determination, recognition and classification for federal income tax purposes (including any method of depreciation, cost recovery or amortization used for that purpose), provided that:

(i)      All fees and other expenses incurred by the Company to promote the sale of (or to sell) any interest that can neither be deducted nor amortized under section 709 of the Code, if any, will, for purposes of Capital Account maintenance, be treated as an item of deduction at the time such fees and other expenses are incurred and will be allocated among the Partners pursuant to Sections 5.1 and 5.2 .

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

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

(iv)      In accordance with the requirements of section 704(b) of the Code, any deductions for depreciation, cost recovery or amortization attributable to any Contributed Property will be determined as if the adjusted basis of such property on the date it was acquired by the Company was equal to the Agreed Value of such property on the date it was acquired by the Company.  Upon an adjustment pursuant to Section 4.5(d) to the Carrying Value of any Company property subject to depreciation, cost recovery or amortization, any further deductions for such depreciation, cost recovery or amortization attributable to such property will be determined (A) as if the adjusted basis of such property were equal to the Carrying Value of such property immediately following such adjustment and (B) using a rate of depreciation, cost recovery or amortization derived from the same method and useful life (or, if applicable, the remaining useful life) as is applied for federal income tax purposes; provided , however , that if the asset has a zero adjusted basis for federal income tax purposes, depreciation, cost recovery or amortization deductions will be determined using any reasonable method that the Company may adopt.

(v)      Any income of the Company that is exempt from federal income tax and not otherwise taken into account in computing Net Income or Net Loss will be added to such taxable income or loss.

(c)       Impact of Succession in Interests .  A Transferee will succeed to the Capital Account of the Transferor relating to the Partnership Interest so Transferred.

(d)       Adjustments to Capital Accounts .

(i)       Additional Partnership Interests .  Consistent with the provisions of Treasury Regulation section 1.704-1(b)(2)(iv)(f), on an issuance of additional Partnership Interests for cash or Contributed Property or upon an adjustment of the Partner’s Capital Accounts pursuant to Section 4.3 , the Capital Accounts of all Partners and the Carrying Value of each Company property immediately prior to such issuance or adjustment will be adjusted upward or downward to reflect any Unrealized Gain or Unrealized Loss attributable to such Company property, as if such Unrealized Gain or Unrealized Loss had been recognized on an actual sale of each such property immediately prior to such issuance or adjustment and had been allocated to the Partners at such time pursuant to Section 5.1 .

(ii)       Adjustments Prior to a Distribution .  In accordance with Treasury Regulation section 1.704-1(b)(2)(iv)(f), immediately prior to any distribution to a Partner of any Company property (other than a distribution of cash or cash equivalents that are not in redemption or retirement of a Partnership Interest), the Capital Accounts of all Partners and the Carrying Value of each Company property will be adjusted upward or downward to reflect any Unrealized Gain or Unrealized Loss attributable to such Company property, as if such Unrealized Gain or Unrealized Loss had been recognized in a sale of such property immediately prior to such distribution for an amount equal to its Fair Market Value (which will be determined by a Majority Interest), and had been allocated to the Partners at such time, pursuant to Section 5.1 .

(e)       Non-Partner Parties .  Notwithstanding anything to the contrary herein, if the Company has not been notified in writing of the existence of any non-Partner Party (i) the Company will not have any liability for maintaining such Party’s Capital Account and (ii) such Party will be responsible for all costs, expenses and other damages suffered by the Company and the other Parties by reason of such lack of notice.

4.6       Partner Parent Guarantees

As an inducement to each other Partner to enter into this Agreement and as security for the payment of Initial Facilities Capital Contributions, each of the Partners have caused their respective Affiliate guarantors to issue a guarantee of such Partner’s obligation to contribute Capital Contributions, and as a further inducement Oiltanking has issued its comfort letter to Enterprise and TEPPCO, true and correct copies of which are attached as Exhibit C .

5.1       Allocations for Capital Account Purposes . For purposes of maintaining the Capital Accounts and in determining the rights of the Parties among themselves, the Company’s items of income, gain, loss and deduction (computed in accordance with Section 4.5(b) ) will be allocated among the Parties for each taxable year (or portion thereof) as provided herein below.

(a)       Net Income .  All items of income, gain, loss and deduction taken into account in computing Net Income for such taxable period, determined after any special allocations required by Sections 5.1(c) through 5.1(j) have first been made, will be allocated to each Party in proportion to its respective Partnership Interests.

(b)       Net Loss .  All items of income, gain, loss and deduction taken into account in computing Net Loss for such taxable period, determined after any special allocations required by Sections 5.1(c) through 5.1(j) have first been made, will be allocated to each Party in proportion to its respective Partnership Interests.

(c)       Nonrecourse Liabilities .  For purposes of Treasury Regulation section 1.752-3(a)(3), the Partners agree that Nonrecourse Liabilities of the Company in excess of the sum of (i) the amount of Partnership Minimum Gain and (ii) the total amount of Nonrecourse Built-in Gain will be allocated among the Parties in accordance with their respective Partnership Interests.

(d)       Partnership Minimum Gain Chargeback .  Notwithstanding the other provisions of this Section 5.1 , except as provided in Treasury Regulation section 1.704-2(f)(2) through (5), if there is a net decrease in Partnership Minimum Gain during such taxable period, each Party will be allocated items of Company income and gain for such period (and, if necessary, subsequent periods) in the manner and amounts provided in Treasury Regulation sections 1.704-2(f)(6) and (g)(2) and section 1.704-2(j)(2)(i), or any successor provisions.  For purposes of this Section 5.1(d) , each Party’s Adjusted Capital Account balance will be determined, and the allocation of income or gain required hereunder will be effected, prior to the application of any other allocations pursuant to this Section 5.1 with respect to such taxable period (other than an allocation pursuant to Section 5.1(h) or (i) ).

(e)       Chargeback of Minimum Gain Attributable to Partner Nonrecourse Debt .  Notwithstanding the other provisions of this Section 5.1 (other than Section 5.1(d) , except as provided in Treasury Regulation section 1.704-2(i)(4)), if there is a net decrease in Minimum Gain Attributable to Partner Nonrecourse Debt during such taxable period, any Party with a share of Minimum Gain Attributable to Partner Nonrecourse Debt at the beginning of such taxable period will be allocated items of Company income and gain for such period (and, if necessary, subsequent periods) in the manner and amounts provided in Treasury Regulation sections 1.704-2(i)(4) and 1.704-2(j)(2)(ii), or any successor provisions.  For purposes of this Section 5.1 , each Party’s Adjusted Capital Account balance will be determined and the allocation of income or gain required hereunder will be effected, prior to the application of any other allocations pursuant to this Se