**AGREEMENT**:     NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreementshereinafter set forth, the parties hereto agree as follows:1. Definitions.     1.1 Certain Interpretive Matters. When a reference is made in this Agreement toSections, such reference will be to a Section of this Agreement unless otherwise indicated.Whenever the words “include,” “includes” or “including” are used in this Agreement, they will bedeemed to be followed by the words “without limitation.” Unless the context otherwise requires,(i) “or” is disjunctive but not necessarily exclusive, (ii) words in the singular include theplural and vice versa, (iii) the use in this Agreement of a pronoun in reference to a party heretoincludes the masculine, feminine or neuter, as the context may require, (iv) the use in thisAgreement of “day” will mean a calendar day unless indicated otherwise, (v) all references to $ ordollar amounts will be to lawful currency of the United States, and (vi) the words “herein”,“hereby”, “hereof”, and “hereunder” and other words of similar import refer to this Agreement as awhole and not to any particular section, paragraph or other subdivision of this Agreement.     1.2 Number of Shares of Stock. Whenever any provision of this Agreement calls for anycalculation based on a number of shares of capital stock issued and outstanding or held by aStockholder, the number of shares deemed to be issued and outstanding or held by that Stockholder,unless specifically stated otherwise, as applicable, shall be the total number of shares of theCompany’s Common Stock, par value $0.01 per share (the “***Common Stock***”), or Preferred Stock thenissued and outstanding or owned by such Stockholder, as applicable.     1.3 Defined Terms. The following capitalized terms, as used in this Agreement, shallhave the meanings set forth below.     ***“Additional L/C Preferred Shares***” means the First L/C Preferred Shares and the Second L/CPreferred Shares.     ***“Additional Letters of Credit***” means the First Letters of Credit and the Second Letters ofCredit.     “***Affiliate***” shall mean with respect to any Person (as defined below), any Person who, directlyor indirectly, controls, is controlled by or is under common control with such Person, includingany partner, officer, director, member, manager or employee of such Person.     “***Alon Common Stock***” shall mean the shares of common stock, par value $0.01 per share, of AlonUSA Energy, Inc., a Delaware corporation.     “***Business Day***” means a day other than a Saturday, Sunday or other day on which commercialbanks in Dallas, Texas are not open for business.     “***Certificate***” means the Company’s Amended and Restated Certificate of Incorporation, as ineffect from time to time.
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     “***Change of Control***” means either of the following events:     (a) the failure, for any reason, of Alon USA or any of its Affiliates to beneficially own,directly or indirectly, at least a majority of the voting stock of the Company or, if applicable,any entity that succeeds to all or substantially all of the assets of the Company by purchase,contribution, assignment, merger, consolidation or otherwise; or     (b) the failure, for any reason, of Alon Israel to beneficially own, directly or indirectly,at least a majority of the voting stock of Alon USA or, if applicable, any entity that succeeds toall or substantially all of the assets of Alon USA by purchase, contribution, assignment, merger,consolidation or otherwise.     “***First L/C Alon Share Price***” shall mean the greater of (i) the average of the daily closingsales prices per share of the Alon Common Stock on the New York Stock Exchange for each trading dayduring the period commencing on the day 90 days prior to the date of the issuance of the FirstLetters of Credit and ending on the date of issuance, and (ii) the closing sale price per share ofthe Alon Common Stock on the New York Stock Exchange on the date of the issuance of the FirstLetters of Credit.     “***First L/C Preferred Shares***” means the Preferred Shares issued upon an exercise of the L/COption with respect to the First Letters of Credit.     “***Original Preferred Alon Share Price***” shall mean the greater of (i) the average of the dailyclosing sales prices per share of the Alon Common Stock on the New York Stock Exchange for eachtrading day during the period commencing on the day 90 days prior to the date of the OriginalStockholders Agreement and ending on the date of the Original Stockholders Agreement (ii) theclosing sale price per share of the Alon Common Stock on the New York Stock Exchange on the date ofthe Original Stockholders Agreement.     “***Original Preferred Shares***” means the 80,000 shares of Preferred Stock issued pursuant to theOriginal Purchase Agreement, together with any and all shares of Preferred Stock that may be issuedupon an exercise of the L/C Option with respect to the Original Letters of Credit.     “***Par Value***” means the par value of $1,000.00 per share of the Preferred Stock.     “***Permitted Transferee***” means any Person to which a Stockholder may Transfer Securities aspermitted by and in accordance with Sections 2.1 and 2.2 of this Agreement.     “***Person***” means an individual, a corporation, an association, a joint venture, a partnership, alimited liability company, an estate, a trust, an unincorporated organization and any other entityor organization, governmental or otherwise.     “***Preferred Shares***” means, collectively, the Original Preferred Shares, the First L/C PreferredShares and the Second L/C Preferred Shares.     “***Preferred Stock***” means the Company’s Series A Preferred Stock, par value $1,000 per share.
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     “***Second L/C Alon Share Price***” shall mean the greater of (i) the average of the daily closingsales prices per share of the Alon Common Stock on the New York Stock Exchange for each trading dayduring the period commencing on the day 90 days prior to the date of the issuance of the SecondLetters of Credit and ending on the date of issuance, and (ii) the closing sale price per share ofthe Alon Common Stock on the New York Stock Exchange on the date of the issuance of the SecondLetters of Credit.     “***Second L/C Preferred Shares***” means the Preferred Shares issued upon an exercise of the L/COption with respect to the Second Letters of Credit.     “***Securities***” means, at any time, any shares of capital stock of the Company, including CommonStock and Preferred Stock now or hereafter issued by the Company, together with any options thereonand any other shares of stock directly or indirectly issued or issuable with respect thereto,whether by way of a stock dividend, stock split or in exchange for or upon conversion of suchshares or otherwise in connection with a combination of shares, recapitalization, merger,consolidation or other corporate reorganization, and any instrument convertible into or exercisableor exchangeable for (in each case, directly or indirectly) shares of capital stock of the Company,together with any shares of stock issued or issuable with respect thereto.     “***Securities Act***” means the Securities Act of 1933, as amended, and the rules and regulationspromulgated thereunder.     “***Series A Dividends***” has the meaning set forth in the Certificate.     “***Share Exchange***” means the issuance and delivery by Alon USA to Alon Israel and/or any of itsPermitted Transferees in exchange for Preferred Shares held by Alon Israel and/or any of itsPermitted Transferees a number of duly authorized, fully paid and nonassessable whole shares ofAlon Common Stock as determined in accordance with Section 2.3 hereof.     “***Transfer***” means any direct transfer, donation, sale, assignment, pledge, hypothecation, grantof a security interest in or other disposal or attempted disposal of all or any portion of aSecurity, any interest or rights in a Security, or any rights under this Agreement. “***Transferred***”means the accomplishment of a Transfer, and “***Transferee***” means the recipient of a Transfer.2. Restrictions on Transfer.     2.1 Restrictions on Transfer. Each Stockholder agrees that such Stockholder will not,without the prior written consent of the Company, not to be unreasonably withheld, Transfer all orany portion of the Securities now owned or hereafter acquired by such Stockholder, except inconnection with, and strictly in compliance with this Article 2. Notwithstanding the foregoing, aTransfer by a Stockholder to any Affiliate of such Stockholder shall not be subject to the priorconsent of the Company.     2.2 Permitted Transfers. Notwithstanding the provisions of Section 2.1, no Transfershall be permitted or effected hereunder unless and until the Transferee shall have entered into ajoinder agreement in form and substance reasonably acceptable to the Stockholders providing thatall Securities so Transferred shall continue to be subject to all provisions of this Agreement asif such Securities were still held by such Stockholder (“***Joinder Agreement***”).
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Notwithstanding anything to the contrary in this Agreement or any failure by a Transfereeunder this Section 2.2 to execute a Joinder Agreement, such Transferee shall take any Securities soTransferred subject to all provisions of this Agreement as if such Securities were still held bythe Stockholder making such Transfer, whether or not they so agree in writing.     2.3 Exchange Right.          (a) Subject to the prior receipt by Alon USA of approval of holders of a majority of the AlonCommon Stock with respect to the issuance of the Exchange Shares (as defined below) pursuant to andin compliance with Section 312.03 of the NYSE’s Listed Company Manual (“***NYSE StockholderApproval***”), prior to the consummation of any Change of Control (a “***Change of Control Date***”), eachof Alon USA and Alon Israel shall have the option, exercisable at each such party’s sole andabsolute discretion, to require the other party to consummate a Share Exchange by delivery to theother party at least 10 Business Days prior to the Change of Control Date of a written notice (the“***Exercise Notice***”) setting forth such party’s election to effectuate a Share Exchange. Any ShareExchange elected pursuant to this Section 2.3(a) shall be consummated effective as of the BusinessDay immediately preceding such Change of Control Date (the “***Change of Control Exchange Date***”).          (b) Subject to the prior receipt by Alon USA of NYSE Stockholder Approval, Alon Israel and/orany of its Permitted Transferees shall have the option (the “***Exchange Option***”), exercisable for afive Business Day period beginning on the first day on which the Alon USA securities trading windowis open after each of January 3, 2010, July 1, 2010 and January 1, 2011 to require Alon USA toconsummate a Share Exchange by delivery to Alon USA of an exercise notice setting forth theelection to effectuate a Share Exchange (the date on which such Share Exchange is consummated beingreferred to herein as a “***Voluntary Exchange Date***”).          (c) If Krotz Springs’ assets are the subject of any proceeding under, or any order, decree orjudgment entered in any proceeding under, any bankruptcy, insolvency, receivership, reorganization,liquidation or other similar law (other than a voluntary liquidation pursuant to which there aresufficient proceeds to distribute to the holders of the Preferred Shares an aggregate amount equalto the par value plus accrued dividends of all of the then outstanding Preferred Shares) (each, a“***Trigger Event***”), then, subject to the prior receipt by Alon USA of NYSE Stockholder Approval, AlonIsrael and/or any of its Permitted Transferees shall have the option to require Alon USA toconsummate a Share Exchange effective (the date on which such Share Exchange is consummated beingreferred to herein as a “***Trigger Event Exchange Date***”).          (d) If a Share Exchange effected pursuant to Sections 2.3(a), (b) or (c) shall not haveoccurred prior to 5:00 p.m. (Dallas, Texas time) on July 1, 2011 (the “***Mandatory Exchange Date***”),then, subject to the prior receipt by Alon USA of NYSE Stockholder Approval, Alon USA and AlonIsrael and/or any of its Permitted Transferees shall consummate a Share Exchange effective as ofthe Mandatory Exchange Date.          (e) Alon USA acknowledges and agrees that it shall include the NYSE Stockholder Approval (andall required disclosures) as a matter to be voted upon in its proxy statement relating to its 2009annual meeting of stockholders.
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          (f) On the Change of Control Exchange Date, Voluntary Exchange Date, Trigger Event ExchangeDate or Mandatory Exchange Date, as applicable, Alon USA shall issue and deliver to Alon Israeland/or any of its Permitted Transferees in exchange for the Preferred Shares subject to such ShareExchange (all of which shares shall be transferred and delivered to Alon USA free and clear of anylien, claim, judgment, charge, mortgage, security interest, escrow, equity or other encumbrance), anumber of duly authorized, fully paid and nonassessable whole shares of Alon Common Stock equal to:     (i) with respect to the Original Preferred Shares, the quotient obtained bydividing (x) the sum of (A) the aggregate Par Value of the Original Preferred Sharesbeing exchanged by Alon Israel and/or any of its Permitted Transferees, and (B) theaggregate Series A Dividends accrued but unpaid on such Original Preferred Shares,whether or not declared, together with any other dividends declared but unpaid onsuch Original Preferred Shares, by (y) the Original Preferred Alon Share Price (the“***Original Exchange Shares***”); provided that in lieu of any fractional share of AlonCommon Stock that would otherwise be payable by operation of this subsection, AlonUSA shall pay to the Person entitled thereto an amount in cash equal to suchfraction multiplied by the Original Preferred Alon Share Price.     (ii) with respect to the First L/C Preferred Shares, the quotient obtained bydividing (x) the sum of (A) the aggregate Par Value of the First L/C PreferredShares being exchanged by Alon Israel and/or any of its Permitted Transferees, and(B) the aggregate Series A Dividends accrued but unpaid on such First L/C PreferredShares, whether or not declared, together with any other dividends declared butunpaid on such First L/C Preferred Shares, by (y) the First L/C Alon Share Price(the “***First L/C Exchange Shares***”); provided that in lieu of any fractional share ofAlon Common Stock that would otherwise be payable by operation of this subsection,Alon USA shall pay to the Person entitled thereto an amount in cash equal to suchfraction multiplied by the First L/C Alon Share Price;     (iii) with respect to the Second L/C Preferred Shares, the quotient obtained bydividing (x) the sum of (A) the aggregate Par Value of the Second L/C PreferredShares being exchanged by Alon Israel and/or any of its Permitted Transferees, and(B) the aggregate Series A Dividends accrued but unpaid on such Second L/C PreferredShares, whether or not declared, together with any other dividends declared butunpaid on such Second L/C Preferred Shares, by (y) the Second L/C Alon Share Price(the “***Second L/C Exchange Shares***” and together with the Original Exchange Shares andthe First L/C Exchange Shares (the “***Exchange Shares***”); provided that in lieu of anyfractional share of Alon Common Stock that would otherwise be payable by operationof this subsection, Alon USA shall pay to the Person entitled thereto an amount incash equal to such fraction multiplied by the Second L/C Alon Share Price; and          (g) As a condition precedent to delivery of Exchange Shares, Alon Israel and/or any of itsPermitted Transferees shall surrender the certificate or certificates for all
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Preferred Shares being exchanged by it and/or its Permitted Transferees pursuant to such ShareExchange (or, if Alon Israel and/or any of its Permitted Transferees alleges that any suchcertificate has been lost, stolen or destroyed, a lost certificate affidavit and agreementreasonably acceptable to Alon USA to indemnify Alon USA and the Company against any claim that maybe made against Alon USA or the Company on account of the alleged loss, theft or destruction ofsuch certificate) to Alon USA at its principal office. If so required by Alon USA, certificatessurrendered for exchange shall be endorsed or accompanied by written instrument or instruments oftransfer, in form reasonably satisfactory to Alon USA, duly executed by the registered holder. Allrights of Alon Israel and/or any of its Permitted Transferees with respect to the Preferred Sharesexchanged pursuant to Section 2.3, whether arising under the Certificate, this Agreement orotherwise, including the rights, if any, to receive Series A Dividends accrued on or after theChange of Control Exchange Date, Voluntary Exchange Date, Trigger Event Exchange Date or MandatoryExchange Date, as applicable, will be deemed transferred and assigned by Alon Israel and itsPermitted Transferees to Alon USA on the Change of Control Exchange Date, Voluntary Exchange Date,Trigger Event Exchange Date or Mandatory Exchange Date, as applicable, (notwithstanding the failureof Alon Israel and/or any of its Permitted Transferees to surrender the certificates at or prior tosuch time), except only the right of Alon Israel and/or any of its Permitted Transferees, uponsurrender of the certificate or certificates (or lost certificate affidavit and agreement)therefor, to receive Exchange Shares.          (h) If there shall occur any reorganization, recapitalization, reclassification or othersimilar event involving Alon USA in which the Alon Common Stock is reclassified as, converted intoor exchanged for new or different securities (the “***Successor Securities***”), then, following any suchreorganization, recapitalization, reclassification or other event, the Preferred Shares shallinstead be exchangeable pursuant to this Section 2.3 for such Successor Securities and allreferences in this Agreement to the Alon Common Stock shall be deemed to be references to suchSuccessor Securities, *mutatis mutandis*.          (i) In connection with a Share Exchange, Alon USA will, upon request, enter into a customaryand reasonable registration rights agreement with a Permitted Transferee of Alon Israel withrespect to shares of Alon USA common stock issued to such Permitted Transferee pursuant to suchShare Exchange.     2.4 Effect of Prohibited Transfers. If any Transfer by any Stockholder is made orattempted contrary to the provisions of this Agreement, such purported Transfer shall be void *abinitio*; the Company and the other parties hereto shall have, in addition to any other legal orequitable remedies which they may have, the right to enforce the provisions of this Agreement byactions for specific performance (to the extent permitted by law); and the Company shall have theright to refuse to recognize any improper Transferee of any Stockholder for any purpose.     2.5 Call Option.          (a) With respect to the Original Preferred Shares, during the 18 month period beginning onJuly 3, 2008, each of Alon USA and Alon LA shall have the option to purchase from Alon Israeland/or its Permitted Transferees all or a portion of the Original Preferred Shares at a price pershare payable in cash equal to the Par Value plus accrued but unpaid dividends; provided, however,that such call option shall be (i) subject to the prior release (or withdrawal
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pursuant to Section 5.1) of the Original Letters of Credit and (ii) conditioned upon theapproval of such purchase by the audit committee of Alon USA.          (b) With respect to the Additional L/C Preferred Shares, during the period beginning on thedate of issuance of any Preferred Shares in connection with the exercise of the L/C Option andending on December 31, 2010, each of Alon USA and Alon LA shall have the option to purchase fromAlon Israel and/or its Permitted Transferees all or a portion of the Additional L/C PreferredShares at a price per share equal to the Par Value plus accrued but unpaid dividends; provided,however, that such call option shall be (i) subject to the prior release (or withdrawal pursuant toSection 5.1) of the Additional Letters of Credit and (ii) conditioned upon the approval of suchpurchase by the audit committee of Alon USA.3. Original Letters of Credit.     3.1 Issuance of Original Letters of Credit. In accordance with the Original PurchaseAgreement, Alon Israel shall have caused to be issued and delivered to Bank of America, N.A. (“***Bankof America***”) one or more irrevocable standby letters of credit (each, an “***Original Letter ofCredit***”) up to the aggregate amount of $55,000,000.00 in order to support the borrowing base ofKrotz Springs under the Revolving Credit Agreement.     3.2 Repayment. In the event that Bank of America draws upon one or more OriginalLetters of Credit at any time during which the Original Letters of Credit are outstanding, Alon LAshall issue and deliver to Alon Israel within three days following each such draw a promissory note(each an “***Original Promissory Note***”) in a principal amount equal to the aggregate amount of suchdraw under the Original Letter(s) of Credit (each an “***Original Repayment Amount***”) and bearinginterest at a rate of 10.75% per annum in full and final settlement and discharge of any obligationor liability of the Company or any Affiliate of the Company to Alon Israel with respect to theOriginal Repayment Amount; provided, however, that no fees, bank charges or other expenses shall beincluded in the determination of the Original Repayment Amount. The principal amount and allaccrued interest under each Original Promissory Note shall be due and payable on or before 12months following the date of issuance of such Original Promissory Note. The Original PromissoryNote will provide that Alon USA may issue a whole number of shares of Alon Common Stock equal tothe quotient of (1) the Original Repayment Amount divided by (2) the Original Preferred Alon SharePrice to satisfy all obligations under the Original Promissory Note. Any shares of Alon CommonStock issued to satisfy the Original Promissory Note shall be issued on the first day on which theAlon Energy securities trading window is open after the date of the Original Promissory Note.     3.3 Replacement. From and after the date of the initial issuance of the OriginalLetters of Credit, Alon USA and the Company shall, and shall cause their Affiliates to, use theirrespective best efforts (subject to the terms of their respective existing credit facilities andother binding obligations) to either (i) replace the Original Letters of Credit with their ownresources or by obtaining funds or other support, including other letters of credit, throughcommercially reasonable arrangements with third party financing sources or (ii) otherwise securethe release by Bank of America of the letter of credit support requirement under the RevolvingCredit Agreement. In addition, if the Original Letters of Credit remain outstanding after thefirst anniversary of the original issuance of such Original Letters of Credit, the Company shall,and
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shall cause Krotz Springs to, use its respective best efforts to prevent any draw down on theOriginal Letters of Credit, including by reducing inventories and throughput at Krotz Springs.     3.4 Expenses, Fees, Charges and Interest. Alon LA or Alon USA (subject to the termsof their respective existing credit facilities and other binding obligations) shall pay the creditsupport obligations of the Company set forth in Section 1.3 of the Original Purchase Agreement andthe Company is hereby released from such obligations.4. Additional Letters of Credit.     4.1 First Letters of Credit. Alon Israel shall cause to be issued and delivered toone or more Persons, as designated by Krotz Springs, one or more irrevocable standby letters ofcredit (the “***First Letters of Credit***”) in an aggregate face amount of up to $15,000,000.00 andshall cause such First Letters of Credit to be maintained (unless replaced, reduced or withdrawn asprovided herein or unless drawn upon by the beneficiary thereof) pursuant to the Term LoanAgreement and the Revolving Credit Agreement.     4.2 Second Letters of Credit. On or before April 30, 2009, Alon Israel shall cause tobe issued and delivered to one or more Persons, as designated by Krotz Springs, one or moreirrevocable standby letters of credit (the “***Second Letters of Credit***”) in an aggregate face amountof up to $10,000,000.00 and shall cause such First Letters of Credit to be maintained (unlessreplaced, reduced or withdrawn as provided herein or unless drawn upon by the beneficiary thereof)pursuant to the Term Loan Agreement and the Revolving Credit Agreement.     4.3 Repayment. In the event that any Person draws upon an Additional Letter of Creditat any time during which any Additional Letter of Credit remains outstanding, Alon LA shall issueand deliver to Alon Israel within three days following each such draw a promissory note (each an“***L/C Promissory Note***”) in a principal amount equal to the aggregate amount of such draw under theapplicable Additional Letter of Credit (each an “***L/C Repayment Amount***”) and bearing interest at arate of 10.75% per annum in full and final settlement and discharge of any obligation or liabilityof the Company or any Affiliate of the Company to Alon Israel with respect to the L/C RepaymentAmount; provided, however, that no fees, bank charges or other expenses shall be included in thedetermination of the L/C Repayment Amount. The principal amount and all accrued interest undereach L/C Promissory Note shall be due and payable on or before 12 months following the date ofissuance of such L/C Promissory Note. Each L/C Promissory Note will provide that Alon USA mayissue a whole number of shares of Alon Common Stock equal to the quotient of (1) the L/C RepaymentAmount divided by (2) the First L/C Alon Share Price or the Second L/C Alon Share Price, asapplicable, to satisfy all obligations under such L/C Promissory Note. Any shares of Alon CommonStock issued to satisfy any L/C Promissory Note shall be issued on the first day on which the AlonUSA securities trading window is open after the date of such L/C Promissory Note.     4.4 Replacement. From and after the date of the initial issuance of the AdditionalLetters of Credit, Alon USA and the Company shall, and shall cause their Affiliates to, use theirrespective best efforts (subject to the terms of their respective existing credit facilities andother binding obligations) to either (i) replace the Additional Letters of Credit with their ownresources or by obtaining funds or other support, including other letters of credit, throughcommercially
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reasonable arrangements with third party financing sources or (ii) otherwise secure therelease of the letter of credit support requirements. In addition, if the Additional Letters ofCredit remain outstanding after the first anniversary of the original issuance of such AdditionalLetters of Credit, the Company shall, and shall cause Krotz Springs to, use its respective bestefforts to prevent any draw down on the Additional Letters of Credit, including by reducinginventories and throughput at Krotz Springs. If the Additional Letters of Credit remain outstandingas of December 31, 2010, Alon USA and Alon LA shall be obligated to replace the Letters of Creditor otherwise secure the release of the letter of credit support requirements; provided, that ifAlon USA and Alon LA fail to replace the Additional Letters of Credit or otherwise release thecredit support requirements by December 31, 2010, Alon USA or Alon LA (subject to the terms oftheir respective existing credit facilities and other binding obligations) shall pay to Alon Israela penalty payment and incur an interest rate adjustment as set forth in Section 4.5.     4.5 Expenses, Fees, Charges and Interest. Alon LA or Alon USA (subject to the termsof their respective existing credit facilities and other binding obligations) shall pay to AlonIsrael for a period beginning on the date of the initial issuance of the Additional Letters ofCredit and ending on December 31, 2009, in consideration for causing the issuance of the Letters ofCredit, a rate per annum equal to 2% of the aggregate amount of Additional Letters of Creditoutstanding. If, after compliance by Alon LA or Alon USA with its obligations under Section 4.4 ofthis Agreement to attempt to replace or secure the release of the Additional Letters of Credit, theAdditional Letters of Credit continue to remain outstanding after December 31, 2009, Alon Israelwill continue to provide the letter of credit support for an additional twelve month period duringwhich Alon LA or Alon USA (subject to the terms of their respective existing credit facilities andother binding obligations) shall pay to Alon Israel, in consideration for continuing the letter ofcredit support, a rate per annum equal to 4% of the aggregate amount of Letters of Creditoutstanding. If Alon USA and the Company fail to release the Additional Letters of Credit byDecember 31, 2010, as required in Section 4.4, and the Additional Letters of Credit continue toremain outstanding at such time, Alon LA or Alon USA (subject to the terms of their respectiveexisting credit facilities and other binding obligations) shall, within three days after December31, 2010, pay to Alon Israel a penalty in an amount equal to the difference between (x) theaggregate amount of payments Alon LA or Alon USA would have paid to Alon Israel for the letter ofcredit support during the period beginning on the date of the initial issuance of the AdditionalLetters of Credit and ending on December 31, 2010 if the rates described above would have been10.75%, less (y) the aggregate amount of payments actually made by Alon Israel for the Letter ofCredit support during such period. Subject to receipt of the penalty payment by Alon LA or AlonUSA, Alon Israel will thereafter continue to provide the letter of credit support until such timeas either Alon LA or Alon USA shall have successfully replaced the Additional Letters of Credit orsuch Additional Letters of Credit shall have been released, during which time Alon LA or Alon USA(subject to the terms of their respective existing credit facilities and other binding obligations)shall pay to Alon Israel, in consideration for continuing the letter of credit support, a rate perannum equal to 10.75 % of the aggregate amount of Additional Letters of Credit outstanding.5. Withdrawal of Letters of Credit and Preferred Stock Purchase Option.     5.1 L/C Option.
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          (a) While any Original Letters of Credit remain outstanding, Alon Israel may exercise the L/COption at any time and from time to time, to withdraw all or a portion of the outstanding OriginalLetters of Credit and acquire Preferred Shares in accordance with Section 5.2 below. The PreferredShares delivered to Alon Israel upon such exercise shall be deemed to constitute Original PreferredShares for all purposes of this Agreement.          (b) While any Additional Letters of Credit remain outstanding, Alon Israel may exercise theL/C Option at any time and from time to time, to withdraw all or a portion of the outstandingAdditional Letters of Credit and acquire Preferred Shares in accordance with Section 5.2 below.          (c) Alon Israel may exercise the L/C Option by providing written notice to Alon LA of AlonIsrael’s election thereof and by providing the date of the anticipated withdrawal of the OriginalLetters of Credit or Additional Letters of Credit, as applicable, which will be at least 10Business Days after the date of the delivery of such notice.     5.2 L/C Stock Purchase Agreement. In the event that Alon Israel exercises an L/COption, Alon Israel and the Company will enter into a stock purchase agreement (the “***L/C StockPurchase Agreement***”) in the form attached hereto as Exhibit A pursuant to which the Companywill sell to Alon Israel a number of Preferred Shares equal to the quotient of (1) the aggregateamount of the outstanding Original Letters of Credit or Additional Letters of Credit, asapplicable, being withdrawn divided by (2) $1,000.00. The sale of such Preferred Shares will notbe registered under the Securities Act, in reliance on an exemption from registration under Section4(2) of the Securities Act. The closing of the transactions contemplated by the L/C Stock PurchaseAgreement will occur contemporaneously with the withdrawal of the Original Letters of Credit orAdditional Letters of Credit, as applicable.6. Miscellaneous Provisions.     6.1 Reliance. Each of the parties hereto agrees that each covenant and agreement madeby it in this Agreement is material, shall be deemed to have been relied upon by the other partiesand shall remain operative and in full force and effect after the date hereof regardless of anyinvestigation. This Agreement shall not be construed so as to confer any right or benefit upon anyPerson other than the parties hereto and their respective successors and permitted assigns to theextent contemplated herein.     6.2 Legend on Securities. The Company and the Stockholders acknowledge and agree thatin addition to any other legend on the certificates representing Securities held by them,substantially the following legend shall be typed on each certificate evidencing any of theSecurities held at any time by any Stockholder:THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEENREGISTERED PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATEOR OTHER JURISDICTION. ABSENT SUCH REGISTRATION OR AN EXEMPTION FROM THE REQUIREMENT THEREFOR, NOTRANSFER OF THESE SHARES OR ANY INTEREST THEREIN MAY BE MADE.
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THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO THE PROVISIONS OF A CERTAIN STOCKHOLDERSAGREEMENT, INCLUDING CERTAIN RESTRICTIONS ON TRANSFER SET FORTH THEREIN. A COMPLETE AND CORRECTCOPY OF SUCH AGREEMENT IS AVAILABLE FOR INSPECTION AT THE PRINCIPAL OFFICE OF THE COMPANY AND WILLBE FURNISHED UPON WRITTEN REQUEST AND WITHOUT CHARGE.     6.3 Alon Common Stock.          (a) Alon Israel understands that any shares of Alon Common Stock that may be issued pursuantto this Agreement will not be registered under the Securities Act, and will be issued by reason ofa specific exemption from the registration provisions of the Securities Act which depends upon,among other things, the bona fide nature of the investment intent and the accuracy of Alon Israel’srepresentations as expressed herein. Alon Israel understands that such shares will be “restrictedsecurities” under applicable U.S. federal and state securities laws and that, pursuant to theselaws, Alon Israel must hold such shares indefinitely unless they are registered with the Securitiesand Exchange Commission and qualified by state authorities, or an exemption from such registrationand qualification requirements is available. Alon Israel acknowledges that, except pursuant to theterms of the Registration Rights Agreement, dated as of July 6, 2005, between Alon USA and AlonIsrael, Alon USA has no obligation to register or qualify such shares for resale. Alon Israelfurther acknowledges that if an exemption from registration or qualification is available, it maybe conditioned on various requirements, including the time and manner of sale and the holdingperiod for such Shares, and on requirements relating to the Company which are outside of AlonIsrael’s control, and which Alon USA is under no obligation and may not be able to satisfy.          (b) Alon Israel acknowledges that Alon USA’s agreement hereunder to issue shares of AlonCommon Stock is made in reliance upon Alon Israel’s representation to Alon USA, which by the itsexecution of this Agreement, Alon Israel hereby confirms, that any shares of Alon Common Stock thatmay be acquired by Alon Israel hereunder will be acquired for investment for Alon Israel’s ownaccount, not as a nominee or agent, and not with a view to the resale or distribution of any partthereof. By executing this Agreement, Alon Israel further represents that it does not presentlyhave any contract, undertaking, agreement or arrangement with any Person to sell, transfer or grantparticipations to such Person or to any third Person, with respect to any of such shares. AlonIsrael has not been formed for the specific purpose of acquiring the Shares.          (c) Alon Israel represents to Alon USA that Alon Israel is an accredited investor as definedin Rule 501(a) of Regulation D promulgated under the Securities Act.          (d) Alon Israel acknowledges and agrees that any certificates representing shares of AlonCommon Stock will bear substantially the following legend:THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEENREGISTERED PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATEOR OTHER JURISDICTION. ABSENT SUCH REGISTRATION OR AN EXEMPTION FROM THE
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REQUIREMENT THEREFOR, NO TRANSFER OF THESE SHARES OR ANY INTEREST THEREIN MAY BE MADE.          (e) Alon Israel represents that, with respect to any issuance of shares of Alon Common Stockpursuant to this Agreement, it will satisfy itself as to the full observance of the laws of Israel,including (i) the legal requirements within Israel for the acquisition of such shares, (ii) anyforeign exchange restrictions applicable to such acquisition, (iii) any governmental or otherconsents that may need to be obtained, and (iv) the income tax and other tax consequences, if any,that may be relevant to the acquisition, holding, redemption, sale, or transfer of such shares.Alon Israel’s acquisition and continued beneficial ownership of such shares will not violate anyapplicable securities or other laws of Israel.     6.4 Successors and Assigns. The terms and conditions of this Agreement shall inure tothe benefit of and be binding upon the respective successors and permitted assigns of the parties.Nothing in this Agreement, express or implied, is intended to confer upon any party other than theparties hereto or their respective successors and assigns any rights, remedies, obligations, orliabilities under or by reason of this Agreement, except as expressly provided in this Agreement.     6.5 Governing Law. This Agreement shall be governed by, and construed in accordancewith, the laws of the State of Texas, regardless of the laws that might otherwise govern underapplicable principles of conflicts of law.     6.6 Counterparts; Facsimile. This Agreement may be executed and delivered byfacsimile signature and in two or more counterparts, each of which shall be deemed an original, butall of which together shall constitute one and the same instrument.     6.7 Titles and Subtitles. The titles and subtitles used in this Agreement are usedfor convenience only and are not to be considered in construing or interpreting this Agreement.     6.8 Notices. All notices and other communications given or made pursuant to thisAgreement shall be in writing and shall be deemed effectively given: (a) upon personal delivery tothe party to be notified, (b) five business days after having been sent by certified mail, returnreceipt requested, postage prepaid, or (d) two business days after deposit with an internationallyrecognized express courier service, specifying same day or next business day delivery, with writtenverification of receipt. All communications shall be sent to the respective parties at theiraddress as set forth on the signature page, or to such address as subsequently modified by writtennotice given in accordance with this Section 6.8.     6.9 Amendments and Waivers. Any term of this Agreement may be amended, terminated orwaived only with the written consent of Alon USA, the Company and the Stockholders.     6.10 Severability. Whenever possible, each provision or portion of any provision ofthis Agreement shall be interpreted in such manner as to be effective and valid under applicablelaw, but if any provision or portion of any provision of this Agreement is held to be invalid,illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, suchinvalidity, illegality or unenforceability shall not affect the validity, legality orenforceability of
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any other provision or portion of any provision in such jurisdiction, and this Agreement shallbe reformed, construed and enforced in such jurisdiction in such manner as will effect as nearly aslawfully possible the purposes and intent of such invalid, illegal or unenforceable provision.     6.11 Delays or Omissions. No delay or omission to exercise any right, power or remedyaccruing to any party under this Agreement, upon any breach or default of any other party underthis Agreement, shall impair any such right, power or remedy of such non-breaching ornon-defaulting party nor shall it be construed to be a waiver of any such breach or default, or anacquiescence therein, or of or in any similar breach or default thereafter occurring; nor shall anywaiver of any single breach or default be deemed a waiver of any other breach or defaulttheretofore or thereafter occurring. Any waiver, permit, consent or approval of any kind orcharacter on the part of any party of any breach or default under this Agreement, or any waiver onthe part of any party of any provisions or conditions of this Agreement, must be in writing andshall be effective only to the extent specifically set forth in such writing. All remedies, eitherunder this Agreement or by law or otherwise afforded to any party, shall be cumulative and notalternative.     6.12 Entire Agreement; Amendment and Restatement. This Agreement constitutes the fulland entire understanding and agreement between the parties with respect to the subject matterhereof, and any other written or oral agreement relating to the subject matter hereof existingbetween the parties are expressly canceled. This Agreement amends and restates the OriginalStockholders Agreement in its entirety.     6.13 Further Assurances. From and after the date of this Agreement, upon the requestof either Stockholder or the Company, the Company and each Stockholder shall execute and deliversuch instruments, documents and other writings as may be reasonably necessary or desirable toconfirm and carry out and to effectuate fully the intent and purposes of this Agreement and thetransactions contemplated hereby.     6.14 After-Acquired Securities; New Parties. Whenever any Stockholder becomes therecord or beneficial owner of additional securities of the Company, such securities will be subjectto all of the terms and conditions of this Agreement. The Company will cause Persons not partiesto this Agreement who from time to time receive securities of the Company to be subject to theterms and conditions of this Agreement.**[Signature Page Follows]**
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     IN WITNESS WHEREOF, the parties hereto have caused this Stockholders Agreement to be dulyexecuted as of the date first set forth above.      ALON USA ENERGY, INC.