Exhibit 10.5

                                                                  EXECUTION COPY

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                                 $570,000,000.00
                                CREDIT AGREEMENT


                                   dated as of
                                OCTOBER 14, 2003


                                      AMONG


                      KINDER MORGAN ENERGY PARTNERS, L.P.,
                                 as the Company,




                            THE LENDERS PARTY HERETO,


                      WACHOVIA BANK, NATIONAL ASSOCIATION,
                          as the Administrative Agent,



                                 CITIBANK, N.A.
                                       and
                              JPMORGAN CHASE BANK,
                          as the Co-Syndication Agents,


                                 BANK ONE, N.A.
                                       and
                               BARCLAYS BANK PLC,
                         as the Co-Documentation Agents




                          WACHOVIA CAPITAL MARKETS, LLC
                                       and
                         CITIGROUP GLOBAL MARKETS, INC.,
                as Joint Lead Arrangers and Joint Book Managers


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<PAGE>


                                TABLE OF CONTENTS

                                                                            Page


ARTICLE I. DEFINITIONS.........................................................1
  SECTION 1.01 Defined Terms...................................................1
  SECTION 1.02 Classification of Loans and Borrowings.........................20
  SECTION 1.03 Accounting Terms; Changes in GAAP..............................20
  SECTION 1.04 Interpretation.................................................20

ARTICLE II. THE CREDITS.......................................................21
  SECTION 2.01 Commitments....................................................21
  SECTION 2.02 Loans and Borrowings...........................................22
  SECTION 2.03 Requests for Committed Borrowings..............................23
  SECTION 2.04 Competitive Bid Procedure......................................23
  SECTION 2.05 THIS SECTION IS INTENTIONALLY OMITTED..........................26
  SECTION 2.06 Telephonic Notices.............................................26
  SECTION 2.07 Funding of Borrowings..........................................26
  SECTION 2.08 Interest Elections.............................................27
  SECTION 2.09 Termination and Reduction of Commitments.......................28
  SECTION 2.10 Repayment of Loans; Evidence of Debt...........................28
  SECTION 2.11 Prepayment of Loans............................................29
  SECTION 2.12 Fees...........................................................30
  SECTION 2.13 Interest.......................................................31
  SECTION 2.14 Alternate Rate of Interest.....................................32
  SECTION 2.15 Increased Costs................................................33
  SECTION 2.16 Break Funding Payments.........................................33
  SECTION 2.17 Taxes..........................................................34
  SECTION 2.18 Payments Generally; Pro Rata Treatment; Sharing of Set-offs....35
  SECTION 2.19 Mitigation Obligations; Replacement of Lenders.................37
  SECTION 2.20 Extensions of Termination Date; Removal of Lenders.............37

ARTICLE III. CONDITIONS PRECEDENT.............................................39
  SECTION 3.01 Conditions Precedent to the Initial Borrowing..................39
  SECTION 3.02 Conditions Precedent to All Borrowings.........................41
  SECTION 3.03 Conditions Precedent to Conversions............................41
  SECTION 3.04 Delivery of Documents..........................................41

ARTICLE IV. REPRESENTATIONS AND WARRANTIES....................................41
  SECTION 4.01 Organization and Qualification.................................42
  SECTION 4.02 Authorization, Validity, Etc...................................42
  SECTION 4.03 Governmental Consents, Etc.....................................42
  SECTION 4.04 No Breach or Violation of Agreements or Restrictions, Etc......42
  SECTION 4.05 Properties.....................................................43
  SECTION 4.06 Litigation and Environmental Matters...........................43
  SECTION 4.07 Financial Statements...........................................43

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  SECTION 4.08 Disclosure.....................................................44
  SECTION 4.09 Investment Company Act.........................................44
  SECTION 4.10 Public Utility Holding Company Act.............................44
  SECTION 4.11 ERISA..........................................................44
  SECTION 4.12 Tax Returns and Payments.......................................44
  SECTION 4.13 Compliance with Laws and Agreements............................45
  SECTION 4.14 Purpose of Loans...............................................45

ARTICLE V. AFFIRMATIVE COVENANTS..............................................45
  SECTION 5.01 Financial Statements and Other Information.....................45
  SECTION 5.02 Existence, Conduct of Business.................................48
  SECTION 5.03 Payment of Obligations.........................................48
  SECTION 5.04 Maintenance of Properties; Insurance...........................48
  SECTION 5.05 Books and Records; Inspection Rights...........................49
  SECTION 5.06 Compliance with Laws...........................................49
  SECTION 5.07 Use of Proceeds................................................49

ARTICLE VI. NEGATIVE COVENANTS................................................49
  SECTION 6.01 Liens..........................................................49
  SECTION 6.02 Fundamental Changes............................................50
  SECTION 6.03 Restricted Payments............................................50
  SECTION 6.04 Transactions with Affiliates...................................50
  SECTION 6.05 Restrictive Agreements.........................................50
  SECTION 6.06 Financial Covenants............................................51

ARTICLE VII. EVENTS OF DEFAULT................................................51
  SECTION 7.01 Events of Default and Remedies.................................51

ARTICLE VIII. THE ADMINISTRATIVE AGENT........................................54
  SECTION 8.01 Appointment, Powers and Immunities.............................54
  SECTION 8.02 Reliance by Administrative Agent...............................55
  SECTION 8.03 Defaults; Events of Default....................................55
  SECTION 8.04 Rights as a Lender.............................................55
  SECTION 8.05 INDEMNIFICATION................................................55
  SECTION 8.06 Non-Reliance on Agents and other Lenders.......................56
  SECTION 8.07 Action by Administrative Agent.................................57
  SECTION 8.08 Resignation or Removal of Administrative Agent.................57
  SECTION 8.09 Duties of Co-Syndication Agents and Co-Documentation Agents....57

ARTICLE IX. MISCELLANEOUS.....................................................58
  SECTION 9.01 Notices, Etc...................................................58
  SECTION 9.02 Waivers; Amendments............................................59
  SECTION 9.03 Payment of Expenses, Indemnities, etc..........................60
  SECTION 9.04 Successors and Assigns.........................................62
  SECTION 9.05 Assignments and Participations.................................62
  SECTION 9.06 Survival; Reinstatement........................................64
  SECTION 9.07 Counterparts; Integration; Effectiveness.......................65

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  SECTION 9.08 Severability...................................................67
  SECTION 9.09 Right of Setoff................................................67
  SECTION 9.10 Governing Law; Jurisdiction; Consent to Service of Process.....68
  SECTION 9.11 WAIVER OF JURY TRIAL...........................................69
  SECTION 9.12 Confidentiality................................................69
  SECTION 9.13 Interest Rate Limitation.......................................70
  SECTION 9.14 EXCULPATION PROVISIONS.........................................70



SCHEDULES:

Schedule 1.01     Commitments
Schedule 4.01     Existing Subsidiaries
Schedule 6.05     Existing Restrictions


EXHIBITS:

Exhibit 1.01-A     Form of Assignment and Acceptance
Exhibit 1.01-B     Form of Committed Note
Exhibit 1.01-C     Form of Competitive Note
Exhibit 2.03       Form of Borrowing Request
Exhibit 2.04-A     Form of Competitive Bid Request
Exhibit 2.04-B     Form of Notice to Lenders of Competitive Bid Request
Exhibit 2.04-C     Form of Competitive Bid
Exhibit 2.07       Form of Notice of Account Designation
Exhibit 2.08       Form of Interest Election Request
Exhibit 2.11       Form of Notice of Prepayment
Exhibit 5.01       Form of Compliance Certificate


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<PAGE>


                                CREDIT AGREEMENT

           THIS  CREDIT   AGREEMENT,   dated  as  of  October  14,  2003  (this
"Agreement") is among:

          (a)  Kinder  Morgan  Energy   Partners,   L.P.,  a  Delaware   limited
partnership (the "Company");

          (b) the banks and other financial institutions listed on the signature
pages hereof under the caption  "Lenders"  (the "Lenders" and together with each
other Person that becomes a Lender  pursuant to Section 2.01(b) or Section 9.05,
collectively, the "Lenders");

          (c) Wachovia   Bank,   National  Association,  a   national    banking
association,  individually as a Lender and as the  administrative  agent for the
Lenders (in such latter  capacity  together  with any other  Person that becomes
Administrative Agent pursuant to Section 8.08, the "Administrative Agent");

          (d) Citibank,  N.A., and JPMorgan Chase  Bank  as  the  Co-Syndication
Agents (the "Co-Syndication Agents"); and

          (e) Bank One, N.A., and  Barclays  Bank  PLC, as the  Co-Documentation
Agents (the "Co-Documentation Agents").

                             PRELIMINARY STATEMENTS

      The  Company  has  requested  that a credit  facility  be  extended  to it
pursuant  to which the  Company may borrow from the Lenders (a) to repay in full
the  principal and accrued  interest on all loans and other amounts  outstanding
under that  certain  Credit  Agreement  dated as of October  15,  2002 among the
Company, the lenders party thereto, Wachovia Bank, National Association,  as the
administrative  agent,  JPMorgan  Chase  Bank,  as  the  syndication  agent  and
Citibank,  N.A., as the  documentation  agent (as amended to date, the "Existing
Credit Agreement"),  (b) to back commercial paper issuance,  and (c) for working
capital and other general partnership purposes.

      NOW, THEREFORE, the parties hereto agree as follows:

                                   ARTICLE I.

                                   DEFINITIONS

          SECTION  1.01 Defined Terms. As used in this Agreement,  the following
terms have the meanings specified below:

      "ABR", when used in reference to any Loan or Borrowing,  refers to whether
such Loan,  or the Loans  comprising  such  Borrowing,  bear  interest at a rate
determined by reference to the Alternate Base Rate.

      "Administrative  Agent" has the meaning  specified in the  introduction to
this Agreement.



<PAGE>


      "Administrative  Questionnaire"  means an Administrative  Questionnaire in
the form supplied by the Administrative Agent.

      "Affiliate" of any Person shall mean (i) any Person directly or indirectly
controlled by, controlling or under common control with such first Person,  (ii)
any  director  or officer of such first  Person or of any Person  referred to in
clause (i) above and (iii) if any  Person in clause (i) above is an  individual,
any member of the immediate  family  (including  parents,  siblings,  spouse and
children) of such individual and any trust whose  principal  beneficiary is such
individual or one or more members of such immediate family and any Person who is
controlled  by any such member or trust.  For purposes of this  definition,  any
Person that owns directly or  indirectly  25% or more of the  securities  having
ordinary voting power for the election of directors or other governing body of a
corporation or 25% or more of the  partnership or other  ownership  interests of
any other Person (other than as a limited  partner of such other Person) will be
deemed to "control" (including,  with its correlative meanings,  "controlled by"
and "under common control with") such corporation or other Person.

      "Agreement"  has  the  meaning  specified  in  the  introduction  to  this
Agreement (subject, however, to Section 1.04(v) hereof).

      "Alternate  Base Rate"  means,  for any day, a rate per annum equal to the
greater of (a) the Federal Funds  Effective  Rate in effect on such day plus 1/2
of 1% and  (b) the  Prime  Rate in  effect  for  such  day (as the  same  may be
increased in accordance with Section 2.01(c)).  Any change in the Alternate Base
Rate due to a change in the Prime Rate or the Federal Funds Effective Rate shall
be  effective  from the  effective  date of such change in the Prime Rate or the
Federal Funds Effective Rate, respectively.

      "Applicable  Margin" means at any time and from time to time, a percentage
per  annum  equal  to  the  applicable   percentage  set  forth  below  for  the
corresponding Performance Level set forth below (as the same may be increased in
accordance with Section 2.01(c)):

                 -------------------------------------
                    Performance    LIBOR Borrowings
                       Level      Margin Percentage
                 -------------------------------------
                         I               .410%
                 -------------------------------------
                        II               .525%
                 -------------------------------------
                        III              .625%
                 -------------------------------------
                        IV               .700%
                 -------------------------------------
                         V              1.125%
                 -------------------------------------

The Applicable  Margin shall be determined by reference to the Performance Level
in effect from time to time,  and any change in the  Applicable  Margin shall be
effective from the effective  date of the change in the  applicable  Performance
Level giving rise thereto.

      "Applicable   Percentage"   means,  with  respect  to   any  Lender,   the
percentage of the Total  Commitment  represented  by  such Lender's  Commitment.
If the Total Commitment has


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terminated or expired, the Applicable Percentages shall be determined based upon
the Total Commitment most recently in effect, giving effect to any assignments.

      "Assignment  and  Acceptance"  means an assignment and acceptance  entered
into by a Lender and an assignee (with the consent of any party whose consent is
required by Section 9.05), and accepted by the Administrative Agent, in the form
of Exhibit 1.01-A or any other form approved by the Administrative Agent.

      "Available Cash" means,  with respect to any fiscal quarter of the Company
(a "Test Quarter"), an amount equal to the algebraic sum of (a) the aggregate of
all cash  distributions  actually  made to and  received by the Company from the
Subsidiaries  in respect of their Capital Stock during such fiscal quarter minus
(b) the aggregate amount of all cash disbursements,  including disbursements for
operating  expenses,  payments of principal of and interest on Indebtedness  and
taxes  (net of  amounts  received  or to be  received  by the  Company  from the
Subsidiaries as reimbursement for such amounts),  and capital  expenditures (net
of any borrowings to fund such capital  expenditures  permitted pursuant to this
Agreement),  actually paid by the Company during such Test Quarter, plus, in the
case of a  decrease,  or minus,  in the case of an  increase  (c) the  amount by
which,  as at the end of such  Test  Quarter,  cash  reserves  necessary  in the
reasonable  discretion of the Company's management for the proper conduct of the
business of the Company and the  Subsidiaries  subsequent  to such Test Quarter,
decreased  or  increased  from the amount of such  reserves as at the end of the
immediately preceding fiscal quarter.

      "Availability  Period"  means the period  from the  Effective  Date to the
Termination Date.

      "Benefit  Arrangement"  means at any time an employee  benefit plan within
the meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan
and which is maintained or otherwise  contributed  to by any member of the ERISA
Group.

      "Board" means the Board of Governors of the Federal  Reserve System of the
United States of America.

      "Board of  Directors"  means,  with  respect to any  Person,  the Board of
Directors  of such Person or any  committee  of the Board of  Directors  of such
Person  duly  authorized  to act on  behalf of the  Board of  Directors  of such
Person.

      "Board  Resolution"  means,  with  respect  to any  Person,  a  copy  of a
resolution  certified by the Secretary or an Assistant  Secretary of such Person
to have been duly  adopted by the Board of Directors of such Person and to be in
full force and effect on the date of such  certification,  and  delivered to the
Administrative Agent.

      "Borrowing"  means  (a)  a  Committed   Borrowing  or  (b)  a  Competitive
Borrowing.

      "Borrowing  Date" means the Business Day upon which any Loan is to be made
available to the Company.

      "Borrowing Request" has the meaning specified in Section 2.03.


                                      -3-
<PAGE>


      "Business  Day" means any day that is not a Saturday,  Sunday or other day
on which commercial  banks in Houston,  Texas, New York, New York, or Charlotte,
North  Carolina,  are authorized or required by law to remain  closed;  provided
that,  when used in connection  with a Eurodollar  Loan, the term "Business Day"
shall also  exclude any day on which  banks are not open for  dealings in dollar
deposits in the London interbank market.

      "Capital Lease  Obligations"  of any Person means the  obligations of such
Person to pay rent or other  amounts  under  any lease of (or other  arrangement
conveying the right to use) real or personal property, or a combination thereof,
which  obligations  are required to be  classified  and accounted for as capital
leases on a balance  sheet of such  Person  under  GAAP,  and the amount of such
obligations  shall be the  capitalized  amount thereof  determined in accordance
with GAAP.

      "Capital  Stock"  means,  with respect to any Person,  any and all shares,
interests,  rights  to  purchase,  warrants,  options,  participations  or other
equivalents (however  designated) of such Person's equity,  including all common
stock and preferred stock, any limited or general  partnership  interest and any
limited liability company member interest.

      "Change in Control" means either (a) the  acquisition  through  beneficial
ownership or otherwise after the date hereof by any person (as such term is used
in section  13(d) and section  14(d)(2) of the  Exchange Act as in effect on the
date hereof) or related  persons  constituting  a group (as such term is used in
Rule 13d-5 under the Exchange Act as in effect on the date hereof) of 30% of the
Voting Stock of the General Partner; or (b) individuals who, at the beginning of
any period of 12 consecutive  months,  constitute the General Partner's Board of
Directors  cease for any reason (other than death or disability) to constitute a
majority of the General Partner's Board of Directors then in office.

      "Change in Control Event" means the execution of any definitive  agreement
which, when fully performed by the parties thereto,  would result in a Change in
Control.

      "Change  in Law" means (a) the  adoption  of any law,  rule or  regulation
after the date of this Agreement,  (b) any change in any law, rule or regulation
or in the  interpretation or application  thereof by any Governmental  Authority
after the date of this  Agreement  or (c)  compliance  by any  Lender  (or,  for
purposes of Section  2.15(b),  by any  lending  office of such Lender or by such
Lender's  holding  company,  if any) with any  request,  guideline  or directive
(whether or not having the force of law) of any  Governmental  Authority made or
issued  after  the date of this  Agreement.  If any  Lender  (or its  applicable
lending  office or its holding  company,  as the case may be) shall be, or shall
determine  itself  to  be,  required  by any  law,  rule,  regulation,  request,
guideline  or  directive  (whether  or not having the force of law)  relating to
capital  requirements  adopted after the date of this Agreement or any change in
the  interpretation or application of any thereof by any Governmental  Authority
after the date of this  Agreement  (each, a "Capital  Requirement")  to maintain
(and in either such case such Lender,  lending office or holding company, as the
case  may be,  does in fact  maintain)  capital  against  such  Lender's  unused
Commitment  (or any  portion  thereof),  in whole or in part as a result of such
unused Commitment (or portion), either alone or in combination with any proposed
or agreed extension thereof (whether or not such extension shall by its terms at
the time be effective), extending or being deemed to extend for a period of more
than one year from its inception or to have an


                                      -4-
<PAGE>


original  maturity  of more than one year or  otherwise  to last for a period of
time sufficient to require  maintenance of capital against it, a "Change in Law"
shall be deemed to have occurred for purposes of Section 2.15(b) with respect to
such Capital Requirement.

      "Charges" has the meaning specified in Section 9.13.

      "Class",  when  used in  reference  to any Loan or  Borrowing,  refers  to
whether such Loan, or the Loans  comprising such Borrowing,  are Committed Loans
or Competitive Loans.

      "Code"  means the Internal  Revenue Code of 1986,  as amended from time to
time.

      "Co-Documentation Agents" has the meaning specified in the introduction to
this Agreement.

      "Commitment"  means,  with respect to each Lender,  the commitment of such
Lender to make Committed Loans  hereunder,  expressed as an amount  representing
the  maximum  aggregate  amount  of  such  Lender's  Committed  Credit  Exposure
hereunder,  as such  commitment may be (a) reduced from time to time pursuant to
Section 2.09 and (b) increased  pursuant to Section 2.01 or reduced or increased
from time to time  pursuant  to  assignments  by or to such  Lender  pursuant to
Section 9.05.  The initial  amount of each  Lender's  Commitment is set forth on
Schedule 1.01 hereto, or in the Assignment and Acceptance pursuant to which such
Lender shall have assumed its Commitment, as applicable.

      "Committed  Borrowing"  means a borrowing  comprised of Committed Loans of
the same Type, made, converted or continued on the same date and, in the case of
Eurodollar Loans, as to which a single Interest Period is in effect.

      "Committed Credit Exposure" means, with respect to any Lender at any time,
the sum of the outstanding  principal amount of such Lender's Committed Loans at
such time.

      "Committed Loan" means a Loan made pursuant to Section 2.03.

      "Committed  Note" means a  promissory  note of the Company  payable to the
order of each Lender, in substantially the form of Exhibit 1.01-B, together with
all modifications, extensions, renewals and rearrangements thereof.

      "Communications" has the meaning specified in Section 9.01.

      "Company" has the meaning specified in the introduction to this Agreement.

      "Company Debt Rating" means, with respect to the Company as of any date of
determination, the rating that has been most recently announced by either S&P or
Moody's,  as the case may be, for any non-credit  enhanced,  unsecured long-term
senior  debt  issued  or to be  issued  by  the  Company.  For  purposes  of the
foregoing:

          (a) if only one of S&P and Moody's shall have in effect a Company Debt
Rating,  the  Applicable  Margin or the Facility  Fee Rate,  as the case may be,
shall be determined by reference to the available rating;


                                      -5-
<PAGE>


          (b) if, at any time,  neither S&P nor  Moody's  shall have in effect a
Company Debt Rating, the Applicable Margin or the Facility Fee Rate, as the case
may be, shall be set in accordance with Performance Level V under the definition
of "Applicable Margin" or "Facility Fee Rate", as the case may be;

          (c) if the ratings  established  by S&P and Moody's  shall fall within
different Performance Levels, the Applicable Margin or the Facility Fee Rate, as
the case may be, shall be based upon the higher rating; provided, however, that,
if the lower of such ratings is two or more Performance  Levels below the higher
of such ratings, the Applicable Margin or the Facility Fee Rate, as the case may
be, shall be based upon the rating that is one Performance Level above the lower
rating;

          (d) if any rating established by S&P or Moody's shall be changed, such
change  shall be  effective  as of the date on which  such  change is  announced
publicly by the rating agency making such change; and

          (e) if S&P or  Moody's  shall  change the basis on which  ratings  are
established by it, each reference to the Company Debt Rating announced by S&P or
Moody's shall refer to the then equivalent rating by S&P or Moody's, as the case
may be.

      "Competitive  Bid" means an offer by a Lender to make a  Competitive  Loan
substantially in the form of Exhibit 2.04-C.

      "Competitive  Bid Rate" means,  with respect to any  Competitive  Bid, the
Margin or the Fixed  Rate,  as  applicable,  offered by the Lender  making  such
Competitive Bid.

      "Competitive  Bid Request" means a request by the Company for  Competitive
Bids in  accordance  with  Section  2.04  substantially  in the form of  Exhibit
2.04-A.

      "Competitive Borrowing" means a borrowing consisting of a Competitive Loan
or concurrent  Competitive Loans of the same Type, as to which a single Interest
Period is in effect  and made on the same date by the  Lender or  Lenders  whose
Competitive  Bid(s) as all or as a part of such  borrowing,  as the case may be,
has (or have) been accepted by the Company under the bidding procedure described
in Section 2.04.

      "Competitive Loan" means a Loan made pursuant to Section 2.04.

      "Competitive  Note" means a promissory  note of the Company payable to the
order of a Lender,  in substantially  the form of Exhibit 1.01-C,  together with
all modifications, extensions, renewals and rearrangements thereof.

      "Consenting Lenders" has the meaning specified in Section 2.20.

      "Consolidated EBITDA" means, for any period, the EBITDA of the Company and
the  Subsidiaries  for  such  period  determined  on  a  consolidated  basis  in
accordance with GAAP.

      "Consolidated  Indebtedness"  means,  at the  date  of  any  determination
thereof,  Indebtedness  of the  Company  and the  Subsidiaries  determined  on a
consolidated basis in


                                      -6-
<PAGE>


accordance  with  GAAP;  excluding,   however,  Guarantees  by  the  Company  of
Indebtedness  of employees of the Company and the  Subsidiaries  in an aggregate
amount  at  any  time  outstanding  for  all  such  Indebtedness  not  exceeding
$7,500,000.

      "Consolidated  Interest  Expense"  means,  for any  period,  the  Interest
Expense of the Company and the  Subsidiaries  for such  period  determined  on a
consolidated basis in accordance with GAAP.

      "Co-Syndication  Agents" has the meaning  specified in the introduction to
this Agreement.

      "Default" means any event or condition which upon notice, lapse of time or
both would, unless cured or waived, become an Event of Default.

      "Delegate"  means  Kinder  Morgan  Management,  LLC,  a  Delaware  limited
liability company.

       "dollars" or "$" refers to lawful money of the United States of America.

      "EBITDA" means (without  duplication),  with respect to any period for any
Person,  the Net Income of such  Person,  increased  (to the extent  deducted in
determining  Net  Income for such  period)  by the sum of (a) all  income  taxes
(including  state  franchise  taxes  based upon  income) of such  Person paid or
accrued according to GAAP for such period; (b) Consolidated  Interest Expense of
such Person for such  period;  and (c)  depreciation  and  amortization  of such
Person for such period determined in accordance with GAAP.

      "Effective Date" means the date occurring on or before October 31, 2003 on
which the  conditions  specified  in Section  3.01 are  satisfied  (or waived in
accordance with Section 9.02).

      "Eligible Assignee" means (a) any Lender; (b) any Affiliate of any Lender;
(c) a commercial bank organized or licensed under the laws of the United States,
or a state thereof,  and having total assets in excess of $1,000,000,000;  (d) a
commercial  bank organized under the laws of any other country which is a member
of the OECD, or a political  subdivision  of any such country,  and having total
assets in excess of $1,000,000,000,  provided that such bank is acting through a
branch or agency  located  in the  country in which it is  organized  or another
country which is also a member of the OECD; and (e) a finance company, insurance
company  or  other  financial   institution  or  fund  (whether  a  corporation,
partnership,  trust or other  entity) that is engaged in making,  purchasing  or
otherwise  investing in commercial  loans in the ordinary course of its business
and  having  a  combined  capital  and  surplus  or  total  assets  of at  least
$100,000,000.

      "Environmental   Laws"  means  all  laws,   rules,   regulations,   codes,
ordinances,  orders,  decrees,  judgments,   injunctions,   notices  or  binding
agreements  issued,  promulgated or entered into by any Governmental  Authority,
relating in any way to the  environment,  preservation or reclamation of natural
resources,  the  management,  release or  threatened  release  of any  Hazardous
Material or to health and safety matters.

      "Environmental  Liability"  means any  liability,  contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the

                                      -7-
<PAGE>


Company or any  Subsidiary  directly or indirectly  resulting from or based upon
(a)  violation of any  Environmental  Law, (b) the  generation,  use,  handling,
transportation,  storage,  treatment or disposal of any Hazardous Materials, (c)
exposure to any Hazardous Materials,  (d) the release of any Hazardous Materials
into  the  environment,  or (e) any  contract,  agreement  or  other  consensual
arrangement  pursuant to which  liability  is assumed or imposed with respect to
any of the foregoing.

      "ERISA"  means the Employee  Retirement  Income  Security Act of 1974,  as
amended from time to time.

      "ERISA  Group"  means the  Company,  any  Subsidiary  and all members of a
controlled  group of corporations  and all trades or businesses  (whether or not
incorporated)  under  common  control  which,  together  with the Company or any
Subsidiary, are treated as a single employer under Section 414 of the Code.

      "Eurodollar",  when used in reference to any Loan or Borrowing,  refers to
whether such Loan, or the Loans  comprising such  Borrowing,  bear interest at a
rate determined by reference to the LIBOR Rate.

      "Event of Default" has the meaning specified in Section 7.01.

      "Exchange Act" means the Securities Exchange Act of 1934, as amended.

      "Excluded  Taxes" means,  with respect to the  Administrative  Agent,  any
Lender or any other  recipient of any payment to be made by or on account of any
Obligation,  (a) income or franchise  taxes  imposed on (or measured by) its net
income by the United States of America, or by the jurisdiction under the laws of
which such  recipient is organized or in which its  principal  office is located
or,  in the case of any  Lender,  in which  its  applicable  lending  office  is
located, (b) any branch profits taxes imposed by the United States of America or
any  similar  tax  imposed  by any other  jurisdiction  in which the  Company is
located and (c) in the case of a Foreign Lender (other than an assignee pursuant
to a request by the Company under Section 2.19(b)),  any withholding tax that is
imposed  on  amounts  payable to such  Foreign  Lender at the time such  Foreign
Lender  becomes a party to this  Agreement  or is  attributable  to such Foreign
Lender's  failure or  inability to comply with  Section  2.17(e),  except to the
extent that such Foreign Lender's assignor (if any) was entitled, at the time of
assignment,  to receive additional amounts from the Company with respect to such
withholding tax pursuant to Section 2.17(a).

      "Execution  Date" means the earliest  date upon which all of the following
shall have occurred:  counterparts of this Agreement shall have been executed by
the  Company  and each  Lender  listed on the  signature  pages  hereof  and the
Administrative  Agent  shall  have  received  counterparts  hereof  which  taken
together,   bear  the  signatures  of  the  Company  and  each  Lender  and  the
Administrative Agent.

      "Existing Credit  Agreement" has the meaning  specified in the Preliminary
Statements.

      "Existing Termination Date" has the meaning specified in Section 2.20.

      "Extended Maturity Date" has the meaning specified in Section 2.01(c).

                                      -8-
<PAGE>


      "Extended  Termination  Date" means, as at any date, the date to which the
      Termination Date has then most recently been extended  pursuant to Section
      2.20.

      "Facility  Fee Rate" means at any time and from time to time, a percentage
per  annum  equal  to  the  applicable   percentage  set  forth  below  for  the
corresponding Performance Level set forth below:

               ---------------------------------------
                Performance Level  Facility Fee Rate
               ---------------------------------------
                        I                 .090%
               ---------------------------------------
                       II                 .100%
               ---------------------------------------
                       III                .125%
               ---------------------------------------
                       IV                 .175%
               ---------------------------------------
                        V                 .250%
               ---------------------------------------

The Facility Fee Rate shall be determined by reference to the Performance  Level
in effect from time to time,  and any change in the  Facility  Fee Rate shall be
effective from the effective  date of the change in the  applicable  Performance
Level giving rise thereto.

      "Federal Funds  Effective Rate" means,  for any day, the weighted  average
(rounded  upwards,  if  necessary,  to the  next  1/100  of 1%) of the  rates on
overnight Federal funds  transactions with members of the Federal Reserve System
arranged by Federal funds brokers,  as published on the next succeeding Business
Day by the  Federal  Reserve  Bank  of New  York,  or,  if  such  rate is not so
published for any day that is a Business Day, the average (rounded  upwards,  if
necessary,  to the  next  1/100 of 1%) of the  quotations  for such day for such
transactions  received  by the  Administrative  Agent from three  Federal  funds
brokers of recognized standing selected by it.

      "Fee Letter" has the meaning specified in Section 2.12.

      "Fixed Rate" means,  with respect to any Competitive  Loan (or Competitive
Borrowing) (other than a Eurodollar Competitive Loan or Competitive  Borrowing),
the fixed rate of interest  per annum  specified  by the  Lender(s)  making such
Competitive   Loan  (or  the  Competitive   Loans  comprising  such  Competitive
Borrowing) in its (or their) related Competitive Bid(s).

      "Fixed Rate Loan" means a  Competitive  Loan  bearing  interest at a Fixed
Rate.

      "Foreign  Lender"  means any Lender that is organized  under the laws of a
jurisdiction  other than that in which the Company is located.  For  purposes of
this  definition,  the United  States of  America,  each state  thereof  and the
District of Columbia shall be deemed to constitute a single jurisdiction.

      "GAAP" means generally accepted accounting principles in the United States
of America from time to time, including as set forth in the opinions, statements
and pronouncements of the Accounting  Principles Board of the American Institute
of Certified Public Accountants and the Financing Accounting Standards Board.

                                      -9-
<PAGE>


      "General Partner" means Kinder Morgan G.P., Inc., a Delaware corporation.

      "Governmental  Authority"  means the  government  of the United  States of
America, any other nation or any political subdivision thereof, whether state or
local,  and any agency,  authority,  instrumentality,  regulatory  body,  court,
central  bank or  other  entity  exercising  executive,  legislative,  judicial,
taxing,  regulatory  or  administrative  powers or functions of or pertaining to
government.

      "Guarantee" of or by any Person (the  "guarantor")  means any  obligation,
contingent or otherwise,  of the guarantor  guaranteeing  or having the economic
effect of guaranteeing  any Indebtedness or other obligation of any other Person
(the  "primary  obligor") in any manner,  whether  directly or  indirectly,  and
including any obligation of the guarantor,  direct or indirect,  (a) to purchase
or pay (or  advance  or  supply  funds  for the  purchase  or  payment  of) such
Indebtedness  or other  obligation or to purchase (or to advance or supply funds
for the purchase of) any  security for the payment  thereof,  (b) to purchase or
lease property,  securities or services for the purpose of assuring the owner of
such  Indebtedness or other obligation of the payment  thereof,  (c) to maintain
working capital,  equity capital or any other financial  statement  condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness  or other  obligation  or (d) as an account party in respect of any
letter of credit or letter of guaranty  issued to support such  Indebtedness  or
obligation; provided, that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business.

      "Hazardous  Materials"  means all explosive or  radioactive  substances or
wastes  and all  hazardous  or toxic  substances,  wastes  or other  pollutants,
including  petroleum or petroleum  distillates,  asbestos or asbestos containing
materials,  polychlorinated  biphenyls,  radon gas, infectious or medical wastes
and all other  substances  or wastes of any  nature  regulated  pursuant  to any
Environmental Law.

      "Hedging Agreement" means any interest rate protection agreement,  foreign
currency  exchange  agreement,  commodity  price  protection  agreement or other
interest or currency exchange rate or commodity price hedging arrangement.

      "Indebtedness"  of  any  Person  means,  without   duplication,   (a)  all
obligations  of such Person for  borrowed  money or with  respect to deposits or
advances of any kind,  (b) all  obligations  of such Person  evidenced by bonds,
debentures,  notes or similar  instruments,  (c) all  obligations of such Person
under conditional sale or other title retention  agreements relating to property
acquired by such Person,  (d) all  obligations  of such Person in respect of the
deferred purchase price of property or services or any other similar  obligation
upon which  interest  charges are  customarily  paid  (excluding  trade accounts
payable  incurred in the ordinary course of business),  (e) all  Indebtedness of
others secured by (or for which the holder of such  Indebtedness has an existing
right,  contingent or otherwise, to be secured by) any Lien on property owned or
acquired by such Person,  whether or not the  Indebtedness  secured  thereby has
been  assumed,  (f) all  Guarantees  by such  Person of  Indebtedness  of others
(provided  that  in the  event  that  any  Indebtedness  of the  Company  or any
Subsidiary shall be the subject of a Guarantee by one or more Subsidiaries or by
the  Company,  as the case  may be,  the  aggregate  amount  of the  outstanding
Indebtedness  of the Company and the  Subsidiaries  in respect  thereof shall be
determined by reference to the primary  Indebtedness so guaranteed,  and without
duplication by

                                      -10-
<PAGE>


reason  of  the  existence  of  any  such  Guarantee),  (g)  all  Capital  Lease
Obligations of such Person,  (h) all  obligations,  contingent or otherwise,  of
such  Person as an account  party in respect of letters of credit and letters of
guaranty and (i) all  obligations,  contingent or  otherwise,  of such Person in
respect of bankers'  acceptances.  The  Indebtedness of any Person shall include
the  Indebtedness  of any other Person  (including any partnership in which such
Person is a general  partner) to the extent such Person is liable  therefor as a
result of such Person's  ownership  interest in or other  relationship with such
entity,  except to the extent the terms of such  Indebtedness  provide that such
Person is not liable therefor.

      "Indemnified Taxes" means Taxes other than Excluded Taxes.

      "Indemnity  Matters"  means,  with respect to any Indemnified  Party,  all
losses,  liabilities,  claims and damages  (including  reasonable legal fees and
expenses).

      "Information  Memorandum" means the Confidential  Information  Memorandum
dated September 2003.

      "Interest Election Request" has the meaning specified in Section 2.08.

      "Interest Expense" means (without duplication), with respect to any period
for any  Person  (a) the  aggregate  amount of  interest,  whether  expensed  or
capitalized, paid, accrued or scheduled to be paid during such period in respect
of the  Indebtedness  of such Person  including (i) the interest  portion of any
deferred  payment  obligation;  (ii) the  portion  of any rental  obligation  in
respect of Capital Lease Obligations  allocable to interest expenses;  and (iii)
any non-cash  interest  payments or accruals,  all determined in accordance with
GAAP, less (b) Interest Income of such Person for such period.

      "Interest  Income"  means,  with  respect to any  period  for any  Person,
interest actually received by such Person during such period.

      "Interest  Payment Date" means (a) with respect to any ABR Loan,  the last
Business Day of each March,  June,  September and December,  (b) with respect to
any Eurodollar Loan, the last Business Day of the Interest Period  applicable to
the  Borrowing  of which  such Loan is a part and,  in the case of a  Eurodollar
Borrowing with an Interest Period of more than three months' duration,  each day
prior to the last day of such Interest  Period that occurs at intervals of three
months'  duration  after  the  first day of such  Interest  Period  and (c) with
respect to any Fixed Rate Loan, the last day of the Interest  Period  applicable
to the  Borrowing  of which such Loan is a part and, in the case of a Fixed Rate
Borrowing  with an  Interest  Period  of more  than 90  days'  duration  (unless
otherwise specified in the applicable  Competitive Bid Request),  each day prior
to the last day of such  Interest  Period that occurs at  intervals  of 90 days'
duration after the first day of such Interest  Period,  and any other dates that
are  specified in the  applicable  Competitive  Bid Request as Interest  Payment
Dates with respect to such Borrowing.

      "Interest Period" means (a) with respect to any Eurodollar Borrowing,  the
period  commencing on the date of such  Borrowing and ending on the  numerically
corresponding  day in the calendar  month that is one, two,  three or six months
thereafter,  as the  Company  may elect and (b) with  respect  to any Fixed Rate
Borrowing,  the  period  (which  shall  not be less than 7 days or more than 180
days) commencing on the date of such Borrowing and ending on the date

                                      -11-
<PAGE>


specified in the applicable Competitive Bid Request;  provided,  that (i) if any
Interest  Period  would end on a day other than a Business  Day,  such  Interest
Period shall be extended to the next succeeding Business Day unless, in the case
of any Eurodollar Borrowing, such next succeeding Business Day would fall in the
next calendar  month,  in which case such Interest  Period shall end on the next
preceding  Business  Day,  (ii) any Interest  Period that  commences on the last
Business Day of a calendar  month (or on a day for which there is no numerically
corresponding  day in the last calendar month of such Interest Period) shall end
on the last Business Day of the last calendar month of such Interest  Period and
(iii) no  Interest  Period  for any  Competitive  Borrowing  shall end after the
Termination  Date and no Interest  Period for any Committed  Borrowing shall end
after the Maturity Date. For purposes hereof, the date of a Borrowing  initially
shall  be the  date on  which  such  Borrowing  is made  and,  in the  case of a
Committed  Borrowing,  thereafter shall be the effective date of the most recent
conversion or continuation of such Borrowing.

      "Lender" has the meaning specified in the introduction to this Agreement.

      "Lenders" has the meaning specified in the introduction to this Agreement.

      "LIBOR"  shall mean the rate of  interest  determined  on the basis of the
rate for deposits in dollars in an amount  substantially  equal to the amount of
the  applicable  Loan  for a  period  equal to the  applicable  Interest  Period
commencing on the first day of such Interest  Period  appearing on Telerate Page
3750 as of 11:00 a.m.  (London time) two Business Days prior to the first day of
the applicable  Interest Period.  In the event that such rate does not appear on
Telerate Page 3750, "LIBOR" shall be determined by the  Administrative  Agent to
be the rate per annum at which  deposits  in  dollars  are  offered  by  leading
reference  banks in the London  interbank  market to Wachovia  at  approximately
11:00  a.m.  (London  time)  two  Business  Days  prior to the  first day of the
applicable  Interest Period for a period equal to such Interest Period and in an
amount substantially equal to the amount of the applicable Loan.

      "LIBOR  Rate" shall mean,  with respect to any LIBOR Loan for any Interest
Period for such Loan, a rate per annum (rounded  upwards,  if necessary,  to the
nearest 1/100 of 1%) determined by the  Administrative  Agent to be equal to the
quotient of (i) LIBOR for such Loan for such Interest  Period  divided by (ii) 1
minus the Reserve Requirement for such Loan for such Interest Period.

      "Lien" means, with respect to any asset, (a) any mortgage,  deed of trust,
lien, pledge, hypothecation,  encumbrance, charge or security interest in, on or
of such asset and (b) the interest of a vendor or a lessor under any conditional
sale  agreement,  capital lease or title  retention  agreement (or any financing
lease having  substantially  the same economic  effect as any of the  foregoing)
relating to such asset.

      "Loan Documents" mean,  collectively,  this Agreement,  the Notes, if any,
the Fee  Letter  and all  other  instruments  and  documents  from  time to time
executed and delivered by the Company in connection herewith and therewith.

      "Loans" means advances made by the Lenders to the Company pursuant to this
Agreement.


                                      -12-
<PAGE>


      "Margin" means, with respect to any Competitive Loan bearing interest at a
rate based on the LIBOR Rate, the marginal rate of interest, if any, to be added
to or  subtracted  from  the  LIBOR  Rate to  determine  the  rate  of  interest
applicable  to such Loan,  as  specified  by the Lender  making such Loan in its
related Competitive Bid.

      "Material  Adverse  Effect" means,  relative to any occurrence of whatever
nature,  a material adverse effect on (a) the business,  assets,  liabilities or
financial  condition of the Company and the  Subsidiaries  taken as a whole, (b)
the ability of the Company to perform the Obligations,  or (c) the rights of the
Administrative  Agent and the Lenders  against the  Company  under any  material
provision of this Agreement or any other Loan Document.

      "Material  Subsidiary"  means any  Subsidiary  the value of the  assets of
which exceeds $75,000,000.

      "Maturity Date" means the earlier of (a) (i) the  Termination  Date or, if
the Company has exercised its option  pursuant to Section  2.01(c) to extend the
maturity of the  Committed  Loans,  (ii) the Extended  Maturity Date and (b) the
date on which the Obligations are accelerated pursuant to Section 7.01.

      "Maximum Rate" has the meaning specified in Section 9.13.

      "Moody's" means Moody's Investors Service, Inc.

      "Multiemployer  Plan"  means a  multiemployer  plan as  defined in Section
4001(a)(3) of ERISA.

      "Net  Income"  means with  respect  to any Person for any period  that net
income of such  Person for such  period  determinant  in  accordance  with GAAP;
provided that there shall be excluded, without duplication, from such net income
(to the extent otherwise included therein):

           (a)  net  extraordinary  gains and losses (other than, in the case of
losses,  losses  resulting  from  charges  against  net income to  establish  or
increase  reserves  for  potential  environmental  liabilities  and reserves for
exposure of such Person under rate cases);

           (b)  net gains or losses in respect of  dispositions  of assets other
than in the ordinary course of business;

           (c)  any  gains or losses  attributable  to write-ups or  write-downs
of assets; and

           (d)  proceeds  of  any   key  man  insurance,  or  any  insurance  on
property, plant or equipment.

      "Net Worth" means,  as to the Company at any date, the amount of partners'
capital of the Company determined as of such date in accordance with GAAP.

      "Nominee" has the meaning specified in Section 2.20.

      "Non-Consenting Lenders" has the meaning specified in Section 2.20.

                                      -13-
<PAGE>


      "Note" means a Committed Note or a Competitive Note.

      "Notice of Account Designation" has the meaning specified in Section 2.07.

      "Notice of Default" has the meaning specified in Section 7.01.

      "Notice of Extension" has the meaning specified in Section 2.20.

      "Notice of  Extension  of  Maturity  Date" has the  meaning  specified  in
Section 2.01(c).

      "Notice of Prepayment" has the meaning specified in Section 2.11.

      "Obligations" means collectively:

           (a)  the  payment  of  all  indebtedness  and  liabilities  by,  and
performance of all other obligations of, the Company in respect of the Loans;

           (b)  the  payment of all other  indebtedness  and  liabilities by and
performance of all other obligations of, the Company to the Administrative Agent
and the Lenders under, with respect to, and arising in connection with, the Loan
Documents, and the payment of all indebtedness and liabilities of the Company to
the Administrative  Agent and the Lenders for fees, costs,  indemnification  and
expenses  (including  reasonable  attorneys'  fees and expenses)  under the Loan
Documents;

           (c)  the  reimbursement  of all sums  advanced and costs and expenses
incurred by the  Administrative  Agent under any Loan Document (whether directly
or  indirectly)  in connection  with the  Obligations or any part thereof or any
renewal, extension or change of or substitution for the Obligations or, any part
thereof,  whether such advances, costs and expenses were made or incurred at the
request of the Company or the Administrative Agent; and

           (d)  all  renewals,   extensions,   amendments  and  changes  of,  or
substitutions or replacements  for, all or any part of the items described under
clauses (a) through (c) above.

      "OECD" means the Organization for Economic Cooperation and Development (or
any successor).

      "Original Termination Date" means October 12, 2004.

      "Other  Taxes"  means any and all present or future  stamp or  documentary
taxes or any other excise or property  taxes,  charges or similar levies arising
from any payment made hereunder or from the  execution,  delivery or enforcement
of, or otherwise with respect to, this Agreement.

      "Participant" has the meaning specified in Section 9.05(e).

      "PBGC"  means the Pension  Benefit  Guaranty  Corporation  referred to and
defined in ERISA and any successor entity performing similar functions.


                                      -14-
<PAGE>


      "Performance  Level"  means a  reference  to one of  Performance  Level I,
Performance Level II, Performance Level III, Performance Level IV or Performance
Level V.

      "Performance  Level  I"  means,  at any  date of  determination,  that the
Company  shall have a Company  Debt Rating in effect on such date of at least A-
by S&P or at least A3 by Moody's.

      "Performance  Level II" means, at any date of determination,  (a) that the
Performance  Level does not meet the requirements of Performance Level I and (b)
that the Company  shall have a Company  Debt Rating in effect on such date of at
least BBB+ by S&P or at least Baa1 by Moody's.

      "Performance Level III" means, at any date of determination,  (a) that the
Performance  Level  does not meet the  requirements  of  Performance  Level I or
Performance  Level II and (b) that the Company  shall have a Company Debt Rating
in effect on such date of at least BBB by S&P or at least Baa2 by Moody's.

      "Performance  Level IV" means, at any date of determination,  (a) that the
Performance  Level  does not  meet  the  requirements  of  Performance  Level I,
Performance  Level II or  Performance  Level III and (b) that the Company  shall
have a Company  Debt Rating in effect on such date of at least BBB- by S&P or at
least Baa3 by Moody's.

      "Performance  Level  V"  means,  at any  date of  determination,  that the
Performance  Level  does not  meet  the  requirements  of  Performance  Level I,
Performance Level II, Performance Level III or Performance Level IV.

      "Permitted Encumbrances" means:

           (a)  Liens  imposed  by law for  taxes  that  are not yet due or are
being contested in compliance with Section 5.03;

           (b)  carriers',     warehousemen's,     mechanics',    materialmen's,
repairmen's and other like Liens imposed by law,  arising in the ordinary course
of business and securing  obligations  that are not overdue by more than 30 days
or are being contested in compliance with Section 5.03;

           (c)  pledges  and deposits made in the ordinary course of business in
compliance with workers'  compensation,  unemployment insurance and other social
security laws or regulations;

           (d)  deposits  to secure the  performance of bids,  trade  contracts,
leases,  statutory obligations,  surety and appeal bonds,  performance bonds and
other  obligations  of a like  nature,  in each case in the  ordinary  course of
business;

           (e)  easements,   zoning  restrictions,   rights-of-way  and  similar
encumbrances  on real property  imposed by law or arising in the ordinary course
of business that do not secure any monetary  obligations  and do not  materially
detract from the value of the affected  property or interfere  with the ordinary
conduct of business of the Company or any Subsidiary;


                                      -15-
<PAGE>


           (f)  judgment  and  attachment  Liens not giving  rise to an Event of
Default or Liens created by or existing from any litigation or legal  proceeding
that are being contested in compliance with Section 5.03;

           (g)  any  interest  or title of a lessor in  property  subject to any
Capital Lease  Obligation or operating  lease which,  in each case, is permitted
under this Agreement; and

           (h)  Liens  in favor of  collecting  or payor banks having a right of
setoff, revocation, refund or chargeback with respect to money or instruments of
the Company or any Subsidiary on deposit with or in possession of such bank;

provided  that the term  "Permitted  Encumbrances"  shall not  include  any Lien
securing Indebtedness, except as provided in clause (g) above.

      "Person" means any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership,  Governmental Authority
or other entity.

      "Plan" means any employee pension benefit plan (other than a Multiemployer
Plan) subject to the  provisions of Title IV of ERISA or Section 412 of the Code
or Section  302 of ERISA,  and in respect of which the  Company or any member of
the ERISA Group is (or, if such plan were  terminated,  would under Section 4069
of ERISA be deemed to be) an "employer" as defined in Section 3(5) of ERISA.

      "Plantation  Pipe Line" means  Plantation  Pipe Line Company,  a Delaware
and Virginia corporation.

      "Prime Rate" shall mean the rate of interest  from time to time  announced
publicly  by the  Administrative  Agent at the  Principal  Office  as its  prime
commercial  lending  rate.  Such  rate is set by the  Administrative  Agent as a
general  reference  rate of  interest,  taking into  account such factors as the
Administrative Agent may deem appropriate,  it being understood that many of the
Administrative  Agent's commercial or other loans are priced in relation to such
rate, that it is not necessarily the lowest or best rate actually charged to any
customer and that the Administrative  Agent may make various commercial or other
loans at rates of interest having no relationship to such rate.

      "Principal  Office" shall mean the principal office of the  Administrative
Agent,  presently located at 301 South College Street, TW-10,  Charlotte,  North
Carolina  28288-0608 or such other location as designated by the  Administrative
Agent from time to time.

      "Register" has the meaning specified in Section 9.05.

      "Regulation A" means  Regulation A of the Board,  as the same is from time
to time in effect,  and all official rulings and  interpretations  thereunder or
thereof.

      "Regulation D" means  Regulation D of the Board,  as the same is from time
to time in effect,  and all official rulings and  interpretations  thereunder or
thereof.


                                      -16-
<PAGE>


      "Regulation T" means  Regulation T of the Board,  as the same is from time
to time in effect,  and all official rulings and  interpretations  thereunder or
thereof.

      "Regulation U" means  Regulation U of the Board,  as the same is from time
to time in effect,  and all official rulings and  interpretations  thereunder or
thereof.

      "Regulation X" means  Regulation X of the Board,  as the same is from time
to time in effect,  and all official rulings and  interpretations  thereunder or
thereof.

      "Related Credit  Agreement" means the Credit Agreement dated as of October
15, 2002 among the Company,  OLP "B", the lenders party thereto,  Wachovia Bank,
National   Association,   as  Administrative  Agent,  JPMorgan  Chase  Bank,  as
Syndication Agent and Citibank, N.A., as Co-Documentation Agents.

      "Related  Parties"  means,  with  respect to any  specified  Person,  such
Person's Affiliates and the respective directors,  officers,  employees,  agents
and advisors of such Person and such Person's Affiliates.

      "Required  Lenders" means, at any time,  Lenders having  Committed  Credit
Exposures and unused  Commitments  representing  more than 50% of the sum of the
total Committed Credit Exposures and unused Commitments at such time.

      "Requirement of Law" shall mean any law, statute, code, ordinance,  order,
determination,   rule,  regulation,  judgment,  decree,  injunction,  franchise,
permit,  certificate,  license,  authorization or other directive or requirement
(whether or not having the force of law),  including  Environmental Laws, energy
regulations and  occupational,  safety and health standards or controls,  of any
Governmental Authority.

      "Reserve  Requirement" means, for any day as applied to a Eurodollar Loan,
the  aggregate  (without  duplication)  of the  rates  (expressed  as a  decimal
fraction)  of  reserve  requirements  in  effect on such day  (including  basic,
supplemental, marginal and emergency reserves under any regulations of the Board
or other  Governmental  Authority  having  jurisdiction  with  respect  thereto)
dealing with reserve requirements prescribed for eurocurrency funding (currently
referred to as  "Eurocurrency  Liabilities"  in  Regulation  D)  maintained by a
member bank of the Federal Reserve System.  Eurodollar  Loans shall be deemed to
constitute   Eurocurrency   Liabilities  and  to  be  subject  to  such  reserve
requirements  without benefit of or credit for proration,  exceptions or offsets
which may be available from time to time to any Lender under Regulation D.

      "Responsible  Officer",  as used with  respect to the  Company,  means the
Chairman, Vice Chairman, President, any Vice President, Chief Executive Officer,
Chief Financial Officer, Controller or Treasurer of the Delegate.

      "Restricted Payment" means any distribution  (whether in cash,  securities
or other property) with respect to any partnership  interest in the Company,  or
any payment  (whether in cash,  securities  or other  property),  including  any
deposit,  on  account  of the  purchase,  redemption,  retirement,  acquisition,
cancellation  or termination of any such  partnership  interest or any option or
other right to acquire any such partnership interest; provided, however, that

                                      -17-
<PAGE>


(a) distributions with respect to the partnership  interests in the Company that
do not exceed, with respect to any fiscal quarter of the Company,  the amount of
Available Cash for such quarter shall not constitute Restricted Payments so long
as both before and after the making of such distribution, no Event of Default or
Default  shall have occurred and be  continuing,  (b) any  partnership  interest
split,  partnership  interest  reverse  split,  dividend of Company  partnership
interests or similar transaction will not constitute a Restricted  Payment,  (c)
the application by the Company after the date of this Agreement to the purchase,
redemption, retirement,  cancellation or termination of partnership interests in
the  Company  of an  aggregate  amount  not  greater  than  the  excess  of  (i)
$100,000,000.00,  over (ii) the aggregate  amount of all amounts applied to such
purchases,  redemptions,  retirements,  cancellations or terminations during the
period  beginning  one day after the Effective  Date and  extending  through and
including the date of this Agreement shall not constitute  Restricted  Payments,
and (d)  acquisitions  by officers,  directors  and  employees of the Company of
partnership  interests  in the  Company  through  cashless  exercise  of options
pursuant  to the  Company's  Common  Unit  Option  Plan,  shall  not  constitute
Restricted Payments.

      "S&P" means Standard & Poor's Ratings Group, a division of The McGraw-Hill
Companies, Inc.

      "SEC" means the  Securities  and Exchange  Commission or any  Governmental
Authority succeeding to its function.

      "SFPP First  Mortgage  Notes" means those  certain  First  Mortgage  Notes
issued  by SFPP,  L.P.  (under  its  prior  name  Southern  Pacific  Pipe  Lines
Partnership,  L.P.), pursuant to a Note Agreement dated December 8, 1988 between
SFPP  and  the  purchasers  named  therein,  which  on the  Execution  Date  are
outstanding in the aggregate principal amount of $37,078,000.

      "Subsidiary" means, with respect to any Person (the "parent") at any date,
any corporation,  limited liability company,  partnership,  association or other
entity the accounts of which would be  consolidated  with those of the parent in
the parent's consolidated financial statements if such financial statements were
prepared  in  accordance  with  GAAP as of  such  date,  as  well  as any  other
corporation, limited liability company, partnership, association or other entity
(a) of which securities or other ownership interests  representing more than 50%
of the equity or more than 50% of the ordinary voting power or, in the case of a
partnership,  more than 50% of the general partnership interests are, as of such
date,  owned,  controlled  or held,  or (b) that is, as of such date,  otherwise
controlled,  by the parent or one or more  subsidiaries  of the parent or by the
parent and one or more subsidiaries of the parent.  Unless the context otherwise
clearly  requires,  references  in  this  Agreement  to a  "Subsidiary"  or  the
"Subsidiaries"  refer  to a  Subsidiary  or the  Subsidiaries  of  the  Company.
Notwithstanding the foregoing, Plantation Pipe Line shall not be a Subsidiary of
the Company  until such time as its assets and  liabilities,  profit or loss and
cash flow are required under GAAP to be consolidated with those of the Company.

      "Tangible Net Worth" means,  as to the Company at any date, Net Worth less
the net book  value on such date of all assets  (after  deducting  any  reserves
applicable  thereto) which would be treated as intangible under GAAP,  including
goodwill,  trademarks,  trade names,  service  marks,  brand names,  copyrights,
patents and unamortized debt discount and expense, organizational


                                      -18-
<PAGE>


expenses  and the excess of the equity in any  Subsidiary  over the cost of the
investment in such Subsidiary.

      "Taxes"  means any and all  present  or  future  taxes,  levies,  imposts,
duties,  deductions,   charges  or  withholdings  imposed  by  any  Governmental
Authority.

      "Term Loan Phase" means the period  beginning on the Termination  Date and
ending on the Extended  Maturity  Date (or, if the maturity of the Loan has been
accelerated to an earlier date, ending on such earlier date).

      "Termination Date" means, at any time, the Original Termination Date or an
Extended  Termination  Date, as the case may be or, in either case,  the earlier
date of termination in whole of the Total Commitment pursuant to Section 2.09 or
Section 7.01.

      "Total  Capitalization"  means,  as to the Company at any date, the sum of
Consolidated   Indebtedness   (determined  at  such  date)  and  the  Net  Worth
(determined  as at the end of the most recent fiscal  quarter of the Company for
which financial  statements  pursuant to Section 5.01(a) or Section 5.01(b),  as
applicable, have been delivered).

      "Total Commitment" means the sum of the Commitments of the Lenders.

      "Transactions"  means  the  execution,  delivery  and  performance  by the
Company of this Agreement and the other Loan  Documents,  the borrowing of Loans
and the use of the proceeds thereof.

      "Type", when used in reference to any Loan or Borrowing, refers to whether
the rate of interest on such Loan, or on the Loans comprising such Borrowing, is
determined by reference to the LIBOR Rate or the Alternate Base Rate.

      "United States" and "U.S." each means United States of America.

      "Utilization Fee" has the meaning specified in Section 2.12.

      "Voting Stock" means, with respect to any Person,  securities of any class
or classes of Capital Stock in such Person entitling holders thereof (whether at
all times or only so long as no senior class of stock has voting power by reason
of any contingency) to vote in the election of members of the Board of Directors
or other  governing  body of such Person or its  managing  member or its general
partner  (or its  managing  general  partner  if there is more than one  general
partner).

      "Wachovia" means Wachovia Bank,  National  Association,  in its individual
capacity.

      "Wholly-owned  Subsidiary"  means a  Subsidiary  of which all  issued  and
outstanding  Capital  Stock  (excluding  (a)  in  the  case  of  a  corporation,
directors'  qualifying  shares, (b) in the case of a limited  partnership,  a 2%
general partner interest and (c) in the case of a limited liability  company,  a
2% managing member interest) is directly or indirectly owned by the Company.


                                      -19-
<PAGE>


      "Withdrawal Liability" means liability to a Multiemployer Plan as a result
of a complete or partial withdrawal from such Multiemployer  Plan, as such terms
are defined in Part I of Subtitle E of Title IV of ERISA.

          SECTION 1.02  Classification of Loans and Borrowings.  For purposes of
this  Agreement,  Loans may be  classified  and  referred to by Class  (e.g.,  a
"Committed Loan" or a "Competitive Loan") or by Type (e.g., a "Eurodollar Loan")
or by Class and Type  (e.g.,  a  "Eurodollar  Committed  Loan" or a "Fixed  Rate
Loan").  Borrowings  also may be  classified  and referred to by Class (e.g.,  a
"Committed  Borrowing"  or a  "Competitive  Borrowing")  or  by  Type  (e.g.,  a
"Eurodollar  Borrowing" or a "Fixed Rate Borrowing") or by Class and Type (e.g.,
a "Eurodollar Committed Borrowing" or a "Fixed Rate Competitive Borrowing").

          SECTION 1.03  Accounting  Terms;  Changes in GAAP.  All accounting and
financial terms used herein and not otherwise  defined herein and the compliance
with each covenant  contained herein which relates to financial matters shall be
determined in accordance with GAAP applied by the Company on a consistent basis,
except to the extent that a deviation  therefrom  is  expressly  stated.  Should
there be a change in GAAP from that in effect on the Execution  Date,  such that
any of the defined  terms set forth in Section 1.01 and/or  compliance  with the
covenants set forth in Article VI would then be calculated in a different manner
or with different  components or any of such covenants and/or defined terms used
therein  would no longer  constitute  meaningful  criteria  for  evaluating  the
matters  addressed  thereby prior to such change in GAAP (a) the Company and the
Required Lenders agree,  within the 60-day period following any such change,  to
negotiate in good faith and enter into an  amendment to this  Agreement in order
to modify the defined terms set forth in Section 1.01 or the covenants set forth
in Article VI, or both, in such respects as shall reasonably be deemed necessary
by the Required  Lenders that the criteria for evaluating the matters  addressed
by such covenants are substantially the same criteria as were effective prior to
any such change in GAAP, and (b) the Company shall be deemed to be in compliance
with such covenants during the 60-day period following any such change, or until
the earlier date of execution of such  amendment,  if and to the extent that the
Company  would  have  been in  compliance  therewith  under  GAAP  as in  effect
immediately prior to such change.

          SECTION  1.04  Interpretation.  In  this  Agreement,  unless  a  clear
contrary intention appears:

          (i)    the singular number includes the plural number and vice versa;

          (ii)   reference to any gender includes each other gender;

          (iii)  the words "herein", "hereof" and "hereunder" and other words of
     similar import refer to this Agreement as a whole and not to any particular
     Article, Section or other subdivision;

          (iv)   reference to any Person includes such Person's  successors  and
     assigns  but,  if  applicable,  only if such  successors  and  assigns  are
     permitted  by this  Agreement,  and  reference  to a Person in a particular
     capacity excludes such Person in any other capacity


                                      -20-
<PAGE>


      or individually;  provided that nothing in this clause (iv) is intended to
      authorize any assignment not otherwise permitted by this Agreement;

          (v)    except as expressly provided to the contrary herein,  reference
     to any agreement, document or instrument (including  this  Agreement) means
     such  agreement,  document  or  instrument  as  amended,  supplemented   or
     modified, or extended, renewed,  refunded,  substituted or replaced, and in
     effect  from  time  to  time  in accordance  with the terms thereof and, if
     applicable,  the  terms hereof,  and reference to any Note or other note or
     Indebtedness or other indebtedness includes any note or indebtedness issued
     pursuant  hereto  in  extension  or  renewal  or  refunding  thereof  or in
     substitution  or replacement therefor;

          (vi)   unless  the  context  indicates  otherwise,  reference  to  any
     Article, Section, Schedule or Exhibit means such Article or Section  hereof
     or such Schedule or Exhibit hereto;

          (vii)  the word "including" (and with correlative  meaning  "include")
     means  including,  without  limiting  the  generality  of  any  description
     preceding such term;

          (viii) with respect to the determination of any period of time, except
     as  expressly  provided to the  contrary,  the word "from"  means "from and
     including" and the word "to" means "to but excluding";

          (ix)   reference to any law, rule or regulation means such as amended,
     modified,  codified or reenacted,  in whole or in part,  and in effect from
     time to time; and

          (x) the words  "asset" and  "property"  shall be construed to have the
     same meaning and effect and refer to any and all  tangible  and  intangible
     assets and properties.

                                   ARTICLE II.

                                   THE CREDITS

          SECTION 2.01 Commitments.  (a) Subject to the terms and conditions set
forth  herein,  each Lender agrees to make  Committed  Loans to the Company from
time to time during the  Availability  Period in an aggregate  principal  amount
that will not result in (i) such Lender's  Committed  Credit Exposure  exceeding
such  Lender's  Commitment  or  (ii)  the  sum of  the  total  Committed  Credit
Exposures, plus the aggregate principal amount of outstanding Competitive Loans,
exceeding the Total Commitment.  In furtherance of the foregoing,  the aggregate
amount of the  Total  Commitment  shall be deemed  used from time to time to the
extent of the aggregate amount of the Competitive  Loans then  outstanding,  and
such deemed use of the Total  Commitment shall be applied to the Lenders ratably
according  to their  respective  Commitments.  Within the  foregoing  limits and
subject to the terms and  conditions  set forth herein,  the Company may borrow,
prepay and reborrow Committed Loans.

          (b) The  Company  shall have the  right,  without  the  consent of the
Lenders  but with the prior  approval  of the  Administrative  Agent,  not to be
unreasonably  withheld,  to cause  from  time to time an  increase  in the total
Commitments of the Lenders by adding to this


                                      -21-
<PAGE>


Agreement one or more  additional  Lenders or by allowing one or more Lenders to
increase their respective Commitments;  provided however (i) no Default or Event
of Default  shall have  occurred  hereunder  which is  continuing,  (ii) no such
increase shall cause the aggregate  Commitments hereunder to exceed $600,000,000
and (iii) no  Lender's  Commitment  shall be  increased  without  such  Lender's
consent.

          (c) All Committed Loans which are outstanding on the Termination  Date
are due and payable,  together with accrued interest thereon, on the Termination
Date unless Company exercises its option to convert such Loans to term loans and
extend  the  maturity  date  of  such  Loans  to the  date  which  is the  first
anniversary of the Termination Date (the "Extended Maturity Date"). In the event
Company  elects  to  exercise  its  option to extend  the  maturity  date of the
Committed  Loans,  Company shall, by written notice  received by  Administrative
Agent (a "Notice of Extension of Maturity  Date") not less than 20 nor more than
60 days prior to the Termination  Date,  advise the Banks that it shall exercise
its  option  to  extend  the  maturity   date  of  the  Committed   Loans.   The
Administrative  Agent will promptly,  and in any event within five Business Days
of the receipt of such Notice of Extension of Maturity Date,  notify the Lenders
of the contents of such notice.  Such Notice of Extension of Maturity Date shall
constitute a representation by Company that (A) no Event of Default has occurred
and is  continuing  and (B) the  representations  and  warranties  contained  in
Article IV are  correct  on and as of the date of such  Notice of  Extension  of
Maturity Date, as though made on and as of such date (unless any  representation
and warranty  expressly  relates to an earlier  date).  In the event the Company
elects to extend the maturity of the Committed  Loans,  the Alternate  Base Rate
and  Applicable  Margin (as the case may be)  applicable to the Committed  Loans
during the Term Loan Phase shall be increased by .25% per annum.

          SECTION 2.02 Loans and  Borrowings.  (a) Each  Committed Loan shall be
made as part of a Borrowing  consisting  of Committed  Loans made by the Lenders
ratably in  accordance  with their  respective  Commitments.  The failure of any
Lender to make any Loan  required  to be made by it shall not  relieve any other
Lender  of  its  obligations  hereunder;   provided  that  the  Commitments  and
Competitive  Bids of the Lenders are several and no Lender shall be  responsible
for any other Lender's failure to make Loans as required.

          (b) Subject to Section 2.14 (i) each  Committed  Borrowing  (including
Committed  Loans  continued and  converted  during the Term Loan Phase) shall be
comprised  entirely of ABR Loans or Eurodollar  Loans as the Company may request
in accordance herewith,  and (ii) each Competitive  Borrowing shall be comprised
entirely of  Eurodollar  Loans or Fixed Rate Loans as the Company may request in
accordance  herewith.  Each Lender at its option may make any Eurodollar Loan by
causing any domestic or foreign  branch or Affiliate of such Lender to make such
Loan;  provided that any exercise of such option shall not affect the obligation
of the  Company  to  repay  such  Loan in  accordance  with  the  terms  of this
Agreement.

          (c) At the  commencement  of each Interest  Period for any  Eurodollar
Committed  Borrowing,  such Borrowing shall be in an aggregate amount that is an
integral  multiple of $1,000,000 and not less than $3,000,000.  At the time that
each ABR Committed  Borrowing is made,  such Borrowing  shall be in an aggregate
amount that is an integral  multiple of $1,000,000 and not less than $1,000,000;
provided that an ABR Committed  Borrowing may be in an aggregate  amount that is
equal to the entire unused balance of the Total Commitment.


                                      -22-
<PAGE>


Each Competitive Bid Request shall be in an aggregate amount that is an integral
multiple of $1,000,000  and not less than  $25,000,000.  Borrowings of more than
one Type and Class may be  outstanding  at the same  time;  provided  that there
shall  not at  any  time  be  more  than a  total  of six  Eurodollar  Committed
Borrowings outstanding.

          (d) Notwithstanding any other provision of this Agreement, the Company
shall not be  entitled  to  request,  or to elect to  convert or  continue,  any
Borrowing if the Interest Period  requested with respect thereto would end after
the Maturity Date.

          SECTION 2.03 Requests for Committed Borrowings. To request a Committed
Borrowing,  the Company shall notify the Administrative Agent of such request by
telephone (a) in the case of a Eurodollar Borrowing,  not later than 10:00 a.m.,
Charlotte,  North  Carolina,  time,  three  Business Days before the date of the
proposed Borrowing and (b) in the case of an ABR Borrowing, not later than 10:00
a.m.,  Charlotte,  North Carolina,  time, on the date of the proposed Borrowing.
Each  such  telephonic  Borrowing  Request  shall be  irrevocable  and  shall be
confirmed promptly by hand delivery or telecopy to the Administrative Agent of a
written Borrowing Request in a form of Exhibit 2.03 (a "Borrowing  Request") and
signed by the Company.  Each such telephonic and written Borrowing Request shall
specify the following information in compliance with Section 2.02:

          (i)   the aggregate amount of the requested Borrowing;

          (ii)  the date of such Borrowing, which shall be a Business Day;

          (iii) whether such Borrowing is to be an ABR Borrowing or a Eurodollar
     Borrowing;

          (iv)  in the case of a  Eurodollar  Borrowing,  the  initial  Interest
     Period to be applicable  thereto,  which shall be a period  contemplated by
     the definition of the term "Interest Period"; and

          (v)   the location and number of the Company's  account to which funds
     are to be disbursed,  which shall comply with the  requirements  of Section
     2.07.

If no election as to the Type of  Committed  Borrowing  is  specified,  then the
requested Committed  Borrowing shall be an ABR Borrowing.  If no Interest Period
is specified with respect to any requested Eurodollar Committed Borrowing,  then
the Company shall be deemed to have  selected an Interest  Period of one month's
duration.  Promptly  following receipt of a Borrowing Request in accordance with
this  Section  2.03,  the  Administrative  Agent shall advise each Lender of the
details  thereof and of the amount of such  Lender's  Loan to be made as part of
the requested Borrowing.

          SECTION 2.04  Competitive Bid Procedure.  (a) Subject to the terms and
conditions set forth herein,  from time to time during the  Availability  Period
the  Company  may  request  Competitive  Bids  and may (but  shall  not have any
obligation to) accept Competitive Bids and borrow  Competitive  Loans;  provided
that  the  sum of the  total  Committed  Credit  Exposures  plus  the  aggregate
principal amount of outstanding  Competitive Loans, at any time shall not exceed
the Total Commitment. To request Competitive Bids, the Company shall notify the


                                      -23-
<PAGE>


Administrative  Agent of such request by telephone,  in the case of a Eurodollar
Borrowing,  not later than 10:00 a.m.,  Charlotte,  North  Carolina,  time, four
Business  Days before the date of the proposed  Borrowing  and, in the case of a
Fixed Rate  Borrowing,  not later than 10:00 a.m.,  Charlotte,  North  Carolina,
time, one Business Day before the date of the proposed Borrowing;  provided that
the Company may submit up to (but not more than) three  Competitive Bid Requests
on the same day, but a  Competitive  Bid Request shall not be made on any of the
five  Business Days next  succeeding  the date of any previous  Competitive  Bid
Request,  unless any and all such previous  Competitive  Bid Requests shall have
been withdrawn or all Competitive  Bids received in response  thereto  rejected.
Each such telephonic Competitive Bid Request shall be confirmed promptly by hand
delivery or telecopy to the  Administrative  Agent of a written  Competitive Bid
Request signed by the Company.  Each such telephonic and written Competitive Bid
Request shall specify the following information in compliance with Section 2.02:

          (i)   the aggregate amount of the requested Borrowing;

          (ii)  the date of such Borrowing, which shall be a Business Day;

          (iii) whether  such  Borrowing  is to be a  Eurodollar  Borrowing or a
     Fixed Rate Borrowing;

          (iv)  the Interest Period to be  applicable to such  Borrowing,  which
     shall be a period  contemplated  by the  definition  of the term  "Interest
     Period"; and

          (v)   the location and number of the Company's  account to which funds
     are to be disbursed,  which shall comply with the  requirements  of Section
     2.07.

Promptly  following receipt of a Competitive Bid Request in accordance with this
Section,  the  Administrative  Agent  shall  notify the  Lenders of the  details
thereof by telecopy  (in  substantially  the form set forth in Exhibit  2.04-B),
inviting the Lenders to submit Competitive Bids.

          (b) Each Lender may (but shall not have any obligation to) make one or
more  Competitive  Bids to the Company in response to a Competitive Bid Request.
Each  Competitive  Bid by a Lender  must be  substantially  the form of  Exhibit
2.04-C and must be received by the Administrative Agent by telecopy, in the case
of a Eurodollar  Competitive  Borrowing,  not later than 10:00 a.m.,  Charlotte,
North  Carolina,  time,  three  Business  Days before the proposed  date of such
Competitive Borrowing, and in the case of a Fixed Rate Borrowing, not later than
10:00 a.m.,  Charlotte,  North  Carolina,  time,  on the  proposed  date of such
Competitive Borrowing. Competitive Bids that do not conform substantially to the
form of Exhibit  2.04-C may be rejected  by the  Administrative  Agent,  and the
Administrative   Agent  shall  notify  the  applicable  Lender  as  promptly  as
practicable.  Each Competitive Bid shall specify (i) the principal amount (which
shall be a minimum of  $5,000,000  and an integral  multiple of  $1,000,000  and
which  may equal  the  entire  principal  amount  of the  Competitive  Borrowing
requested  by the Company) of the  Competitive  Loan or Loans that the Lender is
willing to make,  (ii) the  Competitive Bid Rate or Rates at which the Lender is
prepared to make such Loan or Loans (expressed as a percentage rate per annum in
the form of a decimal to no more than four decimal places) and (iii) the


                                      -24-
<PAGE>


Interest  Period  applicable  to each such Loan and the last day thereof  (which
shall  conform  to that  specified  in the  Company's  related  Competitive  Bid
Request).

          (c) The  Administrative  Agent  shall  promptly  notify the Company by
telecopy of the Competitive Bid Rate and the principal  amount specified in each
Competitive  Bid and the  identity  of the  Lender  that  shall  have  made such
Competitive Bid.

          (d) Subject only to the provisions of this paragraph,  the Company may
accept or reject any  Competitive  Bid in whole or (to the extent  herein  below
provided)  in  part.  The  Company  shall  notify  the  Administrative  Agent by
telephone, confirmed by telecopy in a form approved by the Administrative Agent,
whether and to what  extent it has decided to accept or reject each  Competitive
Bid, in the case of a  Eurodollar  Competitive  Borrowing,  not later than 11:30
a.m.,  Charlotte,  North Carolina,  time, three Business Days before the date of
the proposed Competitive  Borrowing,  and in the case of a Fixed Rate Borrowing,
not later than 11:30 a.m., Charlotte, North Carolina, time, on the proposed date
of the  Competitive  Borrowing;  provided that (i) the failure of the Company to
give such notice shall be deemed to be a rejection of each Competitive Bid, (ii)
the Company shall not accept a Competitive Bid made at a particular  Competitive
Bid Rate if the Company  rejects a Competitive  Bid made at a lower  Competitive
Bid Rate,  (iii) the aggregate  amount of the  Competitive  Bids accepted by the
Company  shall not  exceed the  aggregate  amount of the  requested  Competitive
Borrowing specified in the related  Competitive Bid Request,  (iv) to the extent
necessary to comply with clause (iii) above, the Company may accept  Competitive
Bids at the same Competitive Bid Rate in part, which acceptance,  in the case of
multiple  Competitive  Bids at such Competitive Bid Rate, shall be made pro rata
in  accordance  with the  amount of each such  Competitive  Bid,  and (v) except
pursuant to clause  (iv)  above,  no  Competitive  Bid shall be  accepted  for a
Competitive Loan unless such  Competitive Loan is in a minimum  principal amount
of $5,000,000 and an integral multiple of $1,000,000; provided further that if a
Competitive  Loan  must be in an  amount  less than  $5,000,000  because  of the
provisions of clause (iv) above,  such  Competitive Loan may be for a minimum of
$1,000,000 or any integral  multiple  thereof,  and in calculating  the pro rata
allocation  of  acceptances  of  portions  of  multiple  Competitive  Bids  at a
particular  Competitive  Bid Rate  pursuant to clause (iv) the amounts  shall be
rounded to  integral  multiples  of  $1,000,000  in a manner  determined  by the
Company. A notice given by the Company pursuant to this Section 2.04(d) shall be
irrevocable.

          (e) The Administrative Agent shall promptly notify each bidding Lender
by telecopy  whether or not its  Competitive  Bid has been accepted (and, if so,
the amount and  Competitive Bid Rate so accepted),  and each  successful  bidder
will thereupon become bound, subject to the terms and conditions hereof, to make
the Competitive  Loan in respect of which its Competitive Bid has been accepted.
After  completing the  notifications  referred to in the  immediately  preceding
sentence,  the  Administrative  Agent shall notify each Lender of the  aggregate
principal amount of all Competitive Bids accepted.

          (f) Upon determination by the  Administrative  Agent of the LIBOR Rate
applicable to any Eurodollar  Competitive Loan to be made by any Lender pursuant
to a  Competitive  Bid that has been  accepted by a Company  pursuant to Section
2.04(d), the Administrative Agent shall notify such Lender of (i) the applicable
LIBOR Rate and (ii) the sum of the applicable  LIBOR Rate plus the Margin bid by
such Lender.


                                      -25-
<PAGE>


          (g) If the Administrative  Agent or any of its Affiliates shall at any
time have a Commitment  hereunder and shall elect to submit a Competitive Bid in
its capacity as a Lender,  it shall submit such  Competitive Bid directly to the
Company at least one quarter of an hour earlier than the time by which the other
Lenders are  required to submit  their  Competitive  Bids to the  Administrative
Agent pursuant to paragraph (b) of this Section.

          SECTION 2.05  THIS SECTION IS INTENTIONALLY OMITTED.

          SECTION  2.06  Telephonic  Notices.  Without in any way  limiting  the
obligation  of the  Company to confirm in writing  any  telephonic  notice it is
entitled  to  give  under  this  Agreement  or  any  other  Loan  Document,  the
Administrative  Agent may act without  liability  upon the basis of a telephonic
notice believed in good faith by the Administrative Agent to be from the Company
prior to receipt of written confirmation.  In each such case, the Company hereby
waives the right to dispute the  Administrative  Agent's  record of the terms of
such telephonic notice.

          SECTION  2.07 Funding of  Borrowings.  (a) Each Lender shall make each
Loan to be made by it hereunder on the proposed date thereof by wire transfer of
immediately  available funds by 2:00 p.m., Charlotte,  North Carolina,  time, to
the account of the Administrative  Agent most recently designated by it for such
purpose by notice to the  Lenders.  Not later than 2:00 p.m.  (Charlotte,  North
Carolina,  time) on the proposed Borrowing Date, each Lender will make available
to the  Administrative  Agent, for the account of the Company,  at the office of
the  Administrative  Agent in funds immediately  available to the Administrative
Agent, such Lender's Loans to be made on such Borrowing Date. The Company hereby
irrevocably authorizes the Administrative Agent to disburse the proceeds of each
Borrowing requested pursuant to this Section 2.07 in immediately available funds
by  crediting  or wiring such  proceeds  to the  deposit  account of the Company
identified in the most recent Notice of Account Designation substantially in the
form of Exhibit 2.07 hereto (a "Notice of Account Designation") delivered by the
Company to the Administrative  Agent or otherwise agreed upon by the Company and
the Administrative Agent from time to time.

          (b) Unless the Administrative  Agent shall have received notice from a
Lender  prior to the  proposed  date of any  Borrowing  (or prior to 12:00 noon,
Charlotte,  North Carolina,  time, on such date in the case of an ABR Borrowing)
that such  Lender  will not make  available  to the  Administrative  Agent  such
Lender's share of such Borrowing,  the Administrative Agent may assume that such
Lender has made such share  available  on such date in  accordance  with Section
2.07(a) and may, in reliance upon such assumption, make available to the Company
a  corresponding  amount.  In such  event,  if a Lender has not in fact made its
share of the applicable  Borrowing  available to the Administrative  Agent, then
the  applicable   Lender  and  the  Company   severally  agree  to  pay  to  the
Administrative Agent forthwith on demand such corresponding amount with interest
thereon, for each day from the date such amount is made available to the Company
to the date of payment to the  Administrative  Agent, at (i) in the case of such
Lender, the Federal Funds Effective Rate or (ii) in the case of the Company, the
interest rate  applicable  to ABR Loans.  If such Lender pays such amount to the
Administrative  Agent,  then such amount shall  constitute  such  Lender's  Loan
included in such Borrowing.


                                      -26-
<PAGE>


          SECTION 2.08 Interest  Elections.  (a) Subject to Section  2.14,  each
Committed  Borrowing  initially shall be of the Type specified in the applicable
Borrowing Request and, in the case of a Eurodollar  Committed  Borrowing,  shall
have  an  initial  Interest  Period  as  specified  in such  Borrowing  Request.
Thereafter, including throughout the Term Loan Phase, if applicable, and subject
to Section 2.14,  the Company may elect to convert such Borrowing to a different
Type or to continue such  Borrowing  and, in the case of a Eurodollar  Committed
Borrowing,  may elect Interest Periods therefor, all as provided in this Section
2.08. The Company may elect different options with respect to different portions
of the affected  Borrowing,  in which case each such portion  shall be allocated
ratably among the Lenders holding the Loans  comprising such Borrowing,  and the
Loans  comprising  each such portion shall be  considered a separate  Borrowing.
This Section 2.08 shall not apply to  Competitive  Borrowings,  which may not be
converted or continued.

          (b) To make an election  pursuant to this  Section  2.08,  the Company
shall notify the Administrative  Agent of such election by telephone by the time
that a Borrowing  Request  would be required  under  Section 2.03 if the Company
were  requesting a Committed  Borrowing of the Type resulting from such election
to be  made  on the  effective  date of such  election  (disregarding  for  this
purpose, during the Term Loan Phase, the fact that no such Borrowing Request was
then authorized by Section 2.03). Each such telephonic Interest Election Request
shall be  irrevocable  and  shall be  confirmed  promptly  by hand  delivery  or
telecopy to the  Administrative  Agent of a written Interest Election Request in
the form of Exhibit 2.08 (an "Interest Election Request").

          (c) Each  telephonic  and  written  Interest  Election  Request  shall
specify the following information in compliance with Section 2.02:

          (i)   the Borrowing  to which  such Interest  Election Request applies
     and, if  different  options are being  elected  with  respect to  different
     portions  thereof,  the portions  thereof to be allocated to each resulting
     Borrowing  (in which  case the  information  to be  specified  pursuant  to
     clauses  (iii)  and (iv)  below  shall  be  specified  for  each  resulting
     Borrowing);

          (ii)  the  effective  date  of  the  election  made  pursuant  to such
     Interest Election Request, which shall be a Business Day;

          (iii) whether the  resulting  Borrowing is to be an ABR Borrowing or a
     Eurodollar Borrowing; and

          (iv)  if  the  resulting  Borrowing  is a  Eurodollar  Borrowing,  the
     Interest  Period  to be  applicable  thereto  after  giving  effect to such
     election,  which shall be a period  contemplated  by the  definition of the
     term "Interest Period".

If any such Interest  Election Request requests a Eurodollar  Borrowing but does
not  specify  an  Interest  Period,  then the  Company  shall be  deemed to have
selected an Interest Period of one month's duration.


                                      -27-
<PAGE>


          (d) Promptly  following receipt of an Interest  Election Request,  the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender's portion of each resulting Borrowing.

          (e) If the Company fails to deliver a timely Interest Election Request
with  respect  to a  Eurodollar  Committed  Borrowing  prior  to the  end of the
Interest Period  applicable  thereto,  then,  unless such Borrowing is repaid as
provided  herein,  at the end of such Interest  Period such  Borrowing  shall be
converted to an ABR Borrowing. Notwithstanding any contrary provision hereof, if
and so long as an Event of Default is continuing  (i) no  outstanding  Committed
Borrowing  may be converted to or continued as a Eurodollar  Borrowing  and (ii)
unless repaid, each Eurodollar  Committed Borrowing shall be converted to an ABR
Borrowing at the end of the Interest Period applicable thereto.

          SECTION 2.09  Termination  and  Reduction of  Commitments.  (a) Unless
previously terminated,  the Commitments shall terminate on the Termination Date,
and amounts repaid thereafter may not be reborrowed.

          (b) The  Company  may at any  time  terminate,  or  from  time to time
reduce,  the  Total  Commitment,  in whole or in  part;  provided  that (i) each
partial  reduction  of the Total  Commitment  shall be in an  amount  that is an
integral  multiple  of  $1,000,000  and not less  than  $5,000,000  and (ii) the
Company shall not terminate or reduce the Commitments if, after giving effect to
any concurrent  prepayment of the Loans in accordance with Section 2.11, the sum
of the total Committed Credit Exposures,  plus the aggregate principal amount of
outstanding Competitive Loans, would exceed the Total Commitment.

          (c) The Company shall notify the Administrative  Agent of any election
to terminate or reduce the Total Commitment under Section 2.09(b) at least three
Business  Days prior to the  effective  date of such  termination  or reduction,
specifying  such election and the effective  date  thereof.  Promptly  following
receipt of any notice, the Administrative  Agent shall advise the Lenders of the
contents thereof.  Each notice delivered by the Company pursuant to this Section
2.09 shall be  irrevocable;  provided that a notice of  termination of the Total
Commitment  delivered  by the Company may state that such notice is  conditioned
upon the effectiveness of other credit facilities, in which case such notice may
be revoked by the Company (by notice to the Administrative  Agent on or prior to
the  specified  effective  date)  if  such  condition  is  not  satisfied.   Any
termination  or  reduction  of the Total  Commitment  shall be  permanent.  Each
reduction of the Total  Commitment  shall be made  ratably  among the Lenders in
accordance with their respective Commitments.

          (d) The Total Commitment shall  automatically  terminate on the date a
Change in Control occurs.

          SECTION  2.10  Repayment of Loans;  Evidence of Debt.  (a) The Company
hereby  unconditionally  promises to pay (i) to the Administrative Agent for the
account of each Lender the then unpaid  principal  amount of each Committed Loan
on the  Maturity  Date and (ii) to the  Administrative  Agent for the account of
each Lender  having a Competitive  Loan  outstanding  the then unpaid  principal
amount  of  each  Competitive  Loan  on the  last  day of  the  Interest  Period
applicable to such Loan. In addition,  if prior to the Termination  Date the sum
of


                                      -28-
<PAGE>


the total Committed Credit Exposures, plus the aggregate principal amount of the
outstanding  Competitive Loans, exceeds the Total Commitment,  the Company shall
pay to the  Administrative  Agent for the  account of each  Lender an  aggregate
principal  amount of Committed  Loans  sufficient  to cause the sum of the total
Committed  Credit  Exposures,   plus  the  aggregate  principal  amount  of  the
outstanding Competitive Loans, not to exceed the Total Commitment.

          (b) On the date that a Change in Control  occurs,  the  Company  shall
repay the  outstanding  principal  amount  of the  Loans  and all other  amounts
outstanding hereunder and under the other Loan Documents.

          (c) Each Lender shall  maintain in accordance  with its usual practice
an account or accounts evidencing the indebtedness of the Company to such Lender
resulting from each Loan made by such Lender, including the amounts of principal
and interest payable and paid to such Lender from time to time hereunder.

          (d) The Administrative Agent shall maintain accounts in which it shall
record (i) the amount of each Loan made  hereunder,  the Class and Type  thereof
and the Interest Period applicable thereto,  (ii) the amount of any principal or
interest  due and payable or to become due and payable  from the Company to each
Lender hereunder and (iii) the amount of any sum received by the  Administrative
Agent hereunder for the account of the Lenders and each Lender's share thereof.

          (e) The entries  made in the accounts  maintained  pursuant to Section
2.10(c) or (d) shall be prima facie evidence of the existence and amounts of the
obligations  recorded  therein;  provided  that the failure of any Lender or the
Administrative  Agent to maintain such accounts or any error or conflict therein
shall not in any manner affect the  obligation of the Company to repay the Loans
in accordance with the terms of this Agreement.

          (f) Any Lender may  request  that Loans made by it be  evidenced  by a
Committed  Note or a Competitive  Note,  as the case may be. In such event,  the
Company shall prepare,  execute and deliver to such Lender a Committed Note or a
Competitive  Note, as the case may be.  Thereafter,  the Loans evidenced by such
promissory  note and  interest  thereon  shall  at all  times  (including  after
assignment  pursuant to Section 9.05) be represented  by one or more  promissory
notes in such forms payable to the order of the payee named therein.

          SECTION 2.11 Prepayment of Loans. (a) The Company shall have the right
at any time and from time to time to prepay any  Borrowing  in whole or in part,
subject to prior notice in accordance  with Section  2.11(b);  provided that the
Company  shall not have the right to prepay any  Competitive  Loan  without  the
prior consent of the Lender thereof.

          (b) The Company  shall  notify the  Administrative  Agent by telephone
(confirmed  by telecopy in the form of Exhibit 2.11 (a "Notice of  Prepayment"))
of any  prepayment  hereunder  (i) in the  case of  prepayment  of a  Eurodollar
Committed Borrowing, not later than 11:00 a.m., Charlotte, North Carolina, time,
three  Business  Days  before  the  date of  prepayment  or (ii) in the  case of
prepayment of an ABR Committed Borrowing,  not later than 11:00 a.m., Charlotte,
North Carolina, time, on the date of prepayment. Each such notice shall


                                      -29-
<PAGE>


be  irrevocable  and shall specify the prepayment  date,  Type and the principal
amount of each Borrowing or portion  thereof to be prepaid;  provided that, if a
notice  of  prepayment  is given in  connection  with a  conditional  notice  of
termination of the Commitments as contemplated by Section 2.09, then such notice
of  prepayment  may be  revoked  if such  notice of  termination  is  revoked in
accordance with Section 2.09. Each partial  prepayment  shall be in an aggregate
amount not less than,  and shall be an integral  multiple of, the amounts  shown
below with respect to the applicable Type of Loan or Borrowing:

        ------------------------------------------------------------------
                Type of                   Integral         Minimum
             Loan/Borrowing              Multiple of   Aggregate Amount
        ------------------------------------------------------------------
        Eurodollar Committed Borrowing   $  1,000,000    $  3,000,000
        ------------------------------------------------------------------
        ABR Committed Borrowing             1,000,000       1,000,000
        ------------------------------------------------------------------

Promptly following receipt of any such notice relating to a Committed Borrowing,
the  Administrative  Agent shall advise the Lenders of the contents thereof.  If
the Company fails to designate  the Type of  Borrowings  to be prepaid,  partial
prepayments  shall be applied first to the outstanding ABR Borrowings  until all
such outstanding principal of ABR Borrowings are repaid in full, and then to the
outstanding principal amount of Eurodollar  Borrowings.  Each partial prepayment
of any Committed  Borrowing shall be in an amount that would be permitted in the
case of an advance of a  Committed  Borrowing  of the same Type as  provided  in
Section 2.02. Each prepayment of a Committed  Borrowing shall be applied ratably
to the Loans included in the prepaid Borrowing. Prepayments shall be accompanied
by accrued interest to the extent required by Section 2.13.

          SECTION 2.12 Fees. (a) The Company agrees to pay to the Administrative
Agent for the account of each Lender a facility  fee,  which shall accrue at the
applicable  Facility  Fee Rate on the  daily  amount of the  Commitment  of such
Lender,  whether used or unused and, when the Commitment has terminated,  on the
outstanding  Loans  of such  Lender,  during  the  period  from the date of this
Agreement to the later of (i) the date on which such  Commitment  terminates and
(ii) the date on which the Loans are paid in full.  Accrued  facility fees shall
be payable in arrears on the last  Business Day of March,  June,  September  and
December of each year and on the date on which the Commitments terminate and the
date the Loans  are paid in full,  commencing  on the  first  such date to occur
after the date  hereof.  All  facility  fees shall be computed on the basis of a
year of 365 or 366 days, as the case may be, and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day).

          (b) The Company agrees to pay to each of the Administrative  Agent and
Wachovia Securities,  Inc., for their own accounts,  fees payable in the amounts
and at the times  specified in that letter  agreement  dated  September 29, 2003
among the Company, the Administrative  Agent and Wachovia  Securities,  Inc. (as
from time to time amended, the "Fee Letter").

          (c) The  Company  agrees  to pay to the  Administrative  Agent for the
account of each Lender a utilization fee (the  "Utilization  Fee"),  which shall
accrue at a rate per annum equal to .125% on:


                                      -30-
<PAGE>


          (i) each  Lender's  Commitment  (whether  used or unused) for each day
     during the period from the Effective Date to the Termination Date, on which
     the  sum of the  total  Committed  Credit  Exposures,  plus  the  aggregate
     principal amount of outstanding Competitive Loans, plus the aggregate loans
     and  letters of credit  outstanding  under the  Related  Credit  Agreement,
     exceeds 50% of the sum of the Total Commitment plus the "Total  Commitment"
     (as defined in the Related Credit Agreement), and

          (ii) each Lender's  Committed  Credit Exposure for each day during the
     period from the Termination  Date to the date on which the Committed Credit
     Exposures of all Lenders,  all Competitive  Loans and all loans outstanding
     under the Related Credit  Agreement are paid in full or reduced to zero, on
     which the sum of the total Committed Credit  Exposures,  plus the aggregate
     principal amount of outstanding Competitive Loans, plus the aggregate loans
     and  letters of credit  outstanding  under the  Related  Credit  Agreement,
     exceeds 50% of the sum of Total Commitment, plus the "Total Commitment" (as
     defined  in  the  Related  Credit  Agreement)  determined  as  of  the  day
     immediately preceding the Termination Date.

All Utilization Fees shall be payable in arrears on the last day of March, June,
September  and  December  of each  year  and on the date  the  Committed  Credit
Exposures  of all Lenders and all  Competitive  Loans and all loans  outstanding
under the Related  Credit  Agreement are paid in full or reduced to zero, as the
case may be,  commencing on the first of such dates to occur after the Effective
Date.  All  Utilization  Fees shall be computed on the basis of a year of 365 or
366 days, as the case may be, and shall be payable for the actual number of days
elapsed (including the first day but excluding the last day).

          (d) All fees  payable  hereunder  shall be paid on the dates  due,  in
immediately  available funds, to the Administrative Agent (for distribution,  in
the case of Facility  Fees and  Utilization  Fees,  to the  Lenders).  Except as
required by law, fees paid shall not be refundable under any circumstances.

          SECTION 2.13  Interest.  (a) The Loans  comprising  each ABR Borrowing
shall bear interest at a rate per annum equal to the Alternate Base Rate.

          (b) The Loans comprising each Eurodollar Borrowing shall bear interest
(i) in the  case of a  Eurodollar  Committed  Loan,  at the  LIBOR  Rate for the
Interest Period in effect for such Borrowing plus the Applicable  Margin or (ii)
in the case of a Eurodollar Competitive Loan, at the LIBOR Rate for the Interest
Period in effect for such  Borrowing plus (or minus,  as applicable)  the Margin
applicable to such Loan.

          (c) Each  Fixed  Rate Loan  shall  bear  interest  at the  Fixed  Rate
applicable to such Loan.

          (d) Notwithstanding the foregoing,  if any principal of or interest on
any Loan or any fee or other amount payable by the Company hereunder is not paid
when due,  whether at stated  maturity,  upon  acceleration  or otherwise,  such
overdue amount shall bear interest,  after as well as before judgment, at a rate
per annum equal to (i) in the case of overdue principal of any


                                      -31-
<PAGE>


Loan, 2% plus the rate  otherwise  applicable to such Loan as provided  above or
(ii) in the case of any other amount, 2% plus the Alternate Base Rate.

          (e) Accrued  interest on each Loan shall be payable in arrears on each
Interest Payment Date for such Loan; provided that (i) interest accrued pursuant
to  Section  2.13(d)  shall  be  payable  on  demand,  (ii) in the  event of any
repayment or prepayment of any Loan (other than a prepayment of an ABR Committed
Loan  prior to the end of the  Availability  Period),  accrued  interest  on the
principal  amount  repaid  or  prepaid  shall  be  payable  on the  date of such
repayment or prepayment,  (iii) in the event of any conversion of any Eurodollar
Committed Loan prior to the end of the current Interest Period therefor, accrued
interest on such Loan shall be payable on the effective date of such  conversion
and (iv) all accrued  interest  shall be payable upon  termination  of the Total
Commitment.

          (f) All interest hereunder shall be computed on the basis of a year of
360 days,  except that interest computed by reference to the Alternate Base Rate
at times  when the  Alternate  Base  Rate is based on the  Prime  Rate  shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and in
each case shall be payable for the actual number of days elapsed  (including the
first day but excluding the last day).  The  applicable  Alternate  Base Rate or
LIBOR  Rate  shall  be  determined  by  the   Administrative   Agent,  and  such
determination shall be conclusive absent manifest error.

          SECTION 2.14 Alternate Rate of Interest.  If prior to the commencement
of any Interest Period for a Eurodollar Borrowing:

          (a) the Administrative  Agent determines (which determination shall be
conclusive  absent  manifest  error) that adequate and  reasonable  means do not
exist for ascertaining the LIBOR Rate for such Interest Period; or

          (b) the  Administrative  Agent is advised by the Required Lenders (or,
in the case of a Eurodollar  Competitive Loan, by the Lender that is required to
make such Loan) that the LIBOR Rate for such Interest Period will not adequately
and fairly reflect the cost to such Lenders (or Lender) of making or maintaining
their Loans (or its Loan) included in such Borrowing for such Interest Period;

then the  Administrative  Agent shall give notice thereof to the Company and the
Lenders by  telephone  or telecopy as promptly as  practicable  thereafter  and,
until the  Administrative  Agent  notifies  the Company and the Lenders that the
circumstances  giving  rise to such  notice no longer  exist,  (i) any  Interest
Election Request that requests the conversion of any Committed  Borrowing to, or
continuation  of any  Committed  Borrowing as, a Eurodollar  Borrowing  shall be
ineffective,  (ii) if any  Borrowing  Request  requests a  Eurodollar  Committed
Borrowing,  such  Borrowing  shall be made as an ABR  Borrowing  and  (iii)  any
request  by  the  Company  for  a  Eurodollar  Competitive  Borrowing  shall  be
ineffective;  provided that (A) if the circumstances  giving rise to such notice
do not affect all the  Lenders,  then  requests by the  Company  for  Eurodollar
Competitive  Borrowings may be made to Lenders that are not affected thereby and
(B) if the  circumstances  giving  rise to such  notice  affect only one Type of
Borrowings, then the other Type of Borrowings shall be permitted.


                                      -32-
<PAGE>


          SECTION 2.15 Increased Costs. (a) If any Change in Law shall:

          (i) impose, modify or deem applicable any reserve,  special deposit or
     similar requirement against assets of, deposits with or for the account of,
     or credit  extended  by, any Lender  (except any such  reserve  requirement
     reflected in the LIBOR Rate); or

          (ii) impose  on any  Lender or the London  interbank  market any other
     condition affecting this Agreement or Eurodollar Loans made by such Lender;

and the result of any of the  foregoing  shall be to  increase  the cost to such
Lender of making or maintaining  any  Eurodollar  Loan or Fixed Rate Loan (or of
maintaining its obligation to make any such Loan) or to reduce the amount of any
sum  received or  receivable  by such Lender  hereunder  (whether of  principal,
interest or otherwise), then the Company will pay to such Lender such additional
amount or amounts as will  compensate  such  Lender  for such  additional  costs
incurred or reduction suffered.

          (b) If any Lender  determines that any Change in Law regarding capital
requirements has or would have the effect of reducing the rate of return on such
Lender's capital or on the capital of such Lender's holding company,  if any, as
a  consequence  of this  Agreement  or the Loans made by such  Lender to a level
below  that  which  such  Lender or such  Lender's  holding  company  could have
achieved but for such Change in Law (taking  into  consideration  such  Lender's
policies  and the  policies of such  Lender's  holding  company  with respect to
capital  adequacy),  then from time to time the Company  will pay to such Lender
such  additional  amount  or  amounts  as will  compensate  such  Lender or such
Lender's holding company for any such reduction suffered.

          (c) A  certificate  of a Lender  setting  forth the  amount or amounts
necessary to compensate such Lender or its holding company,  as the case may be,
as specified in paragraph  (a) or (b) of this Section 2.15 shall be delivered to
the Company and shall be conclusive absent manifest error. The Company shall pay
such Lender the amount shown as due on any such  certificate  within 10 Business
Days after receipt thereof.

          (d) Failure or delay on the part of any Lender to demand  compensation
pursuant to this  Section 2.15 shall not  constitute  a waiver of such  Lender's
right to  demand  such  compensation;  provided  that the  Company  shall not be
required to compensate a Lender  pursuant to this Section 2.15 for any increased
costs or  reductions  incurred  more than six months prior to the date that such
Lender  notifies the Company of the Change in Law giving rise to such  increased
costs  or  reductions  and of such  Lender's  intention  to  claim  compensation
therefor;  provided  further  that,  if the  Change in Law  giving  rise to such
increased costs or reductions is retroactive, then the six-month period referred
to above shall be extended to include the period of retroactive effect thereof.

          SECTION 2.16 Break Funding  Payments.  In the event of (a) the payment
of any  principal  of any  Eurodollar  Loan or Fixed Rate Loan other than on the
last day of an Interest Period applicable  thereto  (including as a result of an
Event of Default),  (b) the conversion of any Eurodollar  Loan other than on the
last day of the Interest Period  applicable  thereto,  (c) the failure to borrow
(unless such failure was caused by the failure of a Lender to


                                      -33-
<PAGE>


make such Loan), convert, continue or prepay any Eurodollar Loan, or the failure
to convert an ABR Loan to a Eurodollar Loan, on the date specified in any notice
delivered  pursuant hereto (regardless of whether such notice is permitted to be
revocable  under  Section 2.09 and is revoked in accordance  herewith),  (d) the
failure to borrow any  Competitive  Loan after  accepting the Competitive Bid to
make such Loan  (unless  such  failure  was caused by the failure of a Lender to
make such Loan), or (e) the assignment of any Eurodollar Loan or Fixed Rate Loan
other than on the last day of the Interest Period applicable thereto as a result
of a request by the Company  pursuant to Section 2.19,  then, in any such event,
the  Company  shall  compensate  each  Lender  for the  loss,  cost and  expense
attributable  to such event.  In the case of a Eurodollar  Loan, the loss to any
Lender  attributable  to any such  event  shall be deemed to  include  an amount
determined  by such Lender to be equal to the excess,  if any, of (i) the amount
of interest  that such  Lender  would pay for a deposit  equal to the  principal
amount of such Loan for the period  from the date of such  payment,  conversion,
failure or  assignment to the last day of the then current  Interest  Period for
such Loan (or,  in the case of a failure to borrow,  convert  or  continue,  the
duration of the Interest  Period that would have resulted  from such  borrowing,
conversion  or  continuation)  if the interest rate payable on such deposit were
equal to the  LIBOR  Rate for such  Interest  Period,  over  (ii) the  amount of
interest that such Lender would earn on such principal amount for such period if
such Lender were to invest such principal amount for such period at the interest
rate that  would be bid by such  Lender (or an  affiliate  of such  Lender)  for
dollar deposits from other banks in the Eurodollar market at the commencement of
such period.  A  certificate  of any Lender  setting forth any amount or amounts
that such Lender is entitled to receive  pursuant to this  Section 2.16 shall be
delivered to the Company and shall be  conclusive  absent  manifest  error.  The
Company  shall pay such Lender the amount  shown as due on any such  certificate
within 10 Business Days after receipt thereof.

          SECTION  2.17 Taxes.  (a) Any and all payments by or on account of any
obligation of the Company  hereunder shall be made free and clear of and without
deduction for any Indemnified Taxes or Other Taxes; provided that if the Company
shall be  required  to deduct  any  Indemnified  Taxes or Other  Taxes from such
payments, then (i) the sum payable shall be increased as necessary so that after
making all required deductions  (including  deductions  applicable to additional
sums payable under this Section 2.17) the  Administrative  Agent or a Lender (as
the case may be) receives an amount equal to the sum it would have  received had
no such  deductions  been made,  (ii) the Company shall make such deductions and
(iii)  the  Company  shall  pay  the  full  amount   deducted  to  the  relevant
Governmental Authority in accordance with applicable law.

          (b) In addition, the Company shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.

          (c) The Company  shall  indemnify  the  Administrative  Agent and each
Lender,  within 10 Business Days after  written  demand  therefor,  for the full
amount of any Indemnified  Taxes or Other Taxes (including  Indemnified Taxes or
Other Taxes imposed or asserted on or attributable to amounts payable under this
Section 2.17(c)) paid by the  Administrative  Agent or such Lender,  as the case
may be, and any penalties, interest and reasonable expenses arising therefrom or
with respect thereto,  whether or not such Indemnified Taxes or Other Taxes were
correctly or legally imposed or asserted by the relevant Governmental Authority.
A  certificate  as to the amount of such payment or  liability  delivered to the
Company by a Lender, or by the


                                      -34-
<PAGE>


Administrative  Agent on its own  behalf  or on  behalf  of a  Lender,  shall be
conclusive absent manifest error.

          (d) As soon as practicable  after any payment of Indemnified  Taxes or
Other  Taxes by the  Company to a  Governmental  Authority,  the  Company  shall
deliver  to the  Administrative  Agent the  original  or a  certified  copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy of
the return  reporting such payment or other evidence of such payment  reasonably
satisfactory to the Administrative Agent.

          (e) Any  Foreign  Lender  that is  entitled  to an  exemption  from or
reduction  of  withholding  tax under the law of the  jurisdiction  in which the
Company is located,  or any treaty to which such  jurisdiction is a party,  with
respect to payments  under this  Agreement  shall deliver to the Company (with a
copy to the Administrative Agent), at the time or times prescribed by applicable
law or reasonably requested by the Company, such properly completed and executed
documentation  prescribed by  applicable  law as will permit such payments to be
made without withholding or at a reduced rate.

          (f) If the Administrative  Agent or a Lender  determines,  in its sole
discretion,  that it has  received  a refund of any  Taxes or Other  Taxes as to
which it has been  indemnified  by the  Company  or with  respect  to which  the
Company has paid additional  amounts pursuant to this Section 2.17, it shall pay
over such refund to the Company  (but only to the extent of  indemnity  payments
made,  or  additional  amounts paid, by the Company under this Section 2.17 with
respect to the Taxes and Other  Taxes  giving rise to such  refund),  net of all
out-of-pocket  expenses of the  Administrative  Agent or such Lender and without
interest  (other than any interest paid by the relevant  Governmental  Authority
with respect to such refund);  provided,  that the Company,  upon the request of
the Administrative Agent or such Lender, agrees to repay the amount paid over to
the  Company  (plus any  penalties,  interest  or other  charges  imposed by the
relevant  Governmental  Authority) to the Administrative Agent or such Lender in
the event the  Administrative  Agent or such  Lender is  required  to repay such
refund  to such  Governmental  Authority.  This  Section  2.17(f)  shall  not be
construed to require the  Administrative  Agent or any Lender to make  available
its tax returns (or any other  information  relating to its taxes which it deems
confidential) to the Company or any other Person.

          SECTION  2.18  Payments  Generally;  Pro Rata  Treatment;  Sharing  of
Set-offs.  (a) The Company  shall make each  payment  required to be made by the
Company  hereunder  (whether of  principal,  interest or fees,  or under Section
2.15,  2.16 or  2.17,  or  otherwise)  prior  to 12:00  noon,  Charlotte,  North
Carolina,  time, on the date when due, in immediately  available funds,  without
set-off or  counterclaim.  Any amounts received after such time on any date may,
in the discretion of the  Administrative  Agent, be deemed to have been received
on the  next  succeeding  Business  Day for  purposes  of  calculating  interest
thereon.  All such  payments  shall be made to the  Administrative  Agent at its
Principal Office, except that payments pursuant to Sections 2.15, 2.16, 2.17 and
9.03 shall be made directly to the Persons entitled thereto.  The Administrative
Agent shall  distribute any such payments  received by it for the account of any
other Person to the appropriate recipient promptly following receipt thereof. If
any payment hereunder shall be due on a day that is not a Business Day, the date
for payment shall be extended to the next  succeeding  Business Day, and, in the
case of any payment accruing


                                      -35-
<PAGE>


interest,  interest  thereon shall be payable for the period of such  extension.
All payments hereunder shall be made in dollars.

          (b) If at any time insufficient funds are received by and available to
the  Administrative  Agent to pay fully all amounts of  principal,  interest and
fees then due hereunder,  such funds shall be applied (i) first, to pay interest
and fees then due  hereunder,  ratably  among the  parties  entitled  thereto in
accordance  with the amounts of interest and fees then due to such parties,  and
(ii) second,  to pay  principal  then due  hereunder,  ratably among the parties
entitled  thereto in accordance  with the amounts of principal  then due to such
parties.

          (c) If any  Lender  shall,  by  exercising  any  right of  set-off  or
counterclaim  or  otherwise,  obtain  payment in respect of any  principal of or
interest  on any of its  Committed  Loans  resulting  in such  Lender  receiving
payment of a greater  proportion of the aggregate  amount of its Committed Loans
and accrued interest  thereon than the proportion  received by any other Lender,
then the Lender  receiving such greater  proportion  shall purchase (for cash at
face value) participations in the Committed Loans of other Lenders to the extent
necessary  so that the  benefit  of all such  payments  shall be  shared  by the
Lenders  ratably in  accordance  with the  aggregate  amount of principal of and
accrued interest on their respective  Committed Loans;  provided that (i) if any
such  participations  are purchased and all or any portion of the payment giving
rise  thereto is  recovered,  such  participations  shall be  rescinded  and the
purchase price restored to the extent of such recovery,  without  interest,  and
(ii) the  provisions  of this  paragraph  shall not be construed to apply to any
payment made by the Company pursuant to and in accordance with the express terms
of this Agreement or any payment obtained by a Lender as  consideration  for the
assignment  of or sale of a  participation  in any of its Loans to any assignee,
other than to the Company or any  Subsidiary  or Affiliate  thereof (as to which
the  provisions  of this  paragraph  shall apply).  The Company  consents to the
foregoing and agrees,  to the extent it may  effectively do so under  applicable
law,  that any  Lender  acquiring  a  participation  pursuant  to the  foregoing
arrangements may exercise against the Company rights of set-off and counterclaim
with  respect to such  participation  as fully as if such  Lender  were a direct
creditor of the Company in the amount of such participation.

          (d) Unless the  Administrative  Agent shall have received  notice from
the Company prior to the date on which any payment is due to the  Administrative
Agent for the account of the Lenders  hereunder  that the Company  will not make
such payment, the Administrative Agent may assume that the Company has made such
payment on such date in  accordance  herewith  and may,  in  reliance  upon such
assumption,  distribute  to the Lenders  the amount  due. In such event,  if the
Company has not in fact made such  payment,  then each of the Lenders  severally
agrees to repay to the  Administrative  Agent  forthwith on demand the amount so
distributed  to such Lender with  interest  thereon,  for each day from the date
such amount is  distributed  to it to the date of payment to the  Administrative
Agent, at the Federal Funds Effective Rate.

          (e) If any Lender  shall fail to make any payment  required to be made
by it pursuant to Section 2.07(b) or 2.18(d), then the Administrative Agent may,
in its discretion  (notwithstanding  any contrary provision  hereof),  apply any
amounts thereafter received by the Administrative  Agent for the account of such
Lender to satisfy such Lender's  obligations  under such Sections until all such
unsatisfied obligations are fully paid.


                                      -36-
<PAGE>


          SECTION 2.19 Mitigation  Obligations;  Replacement of Lenders.  (a) If
any Lender  requests  compensation  under  Section  2.15,  or if the  Company is
required  to pay  any  additional  amount  to  any  Lender  or any  Governmental
Authority  for the  account of any Lender  pursuant to Section  2.17,  then such
Lender shall use reasonable  efforts to designate a different lending office for
funding or booking its Loans  hereunder or to assign its rights and  obligations
hereunder to another of its offices, branches or affiliates, if, in the judgment
of such Lender,  such  designation or assignment  (i) would  eliminate or reduce
amounts  payable  pursuant to Section  2.15 or 2.17,  as the case may be, in the
future  and (ii)  would not  subject  such  Lender to any  unreimbursed  cost or
expense and would not otherwise be disadvantageous to such Lender.

          (b) If any Lender requests  compensation under Section 2.15, or if the
Company  is  required  to  pay  any  additional  amount  to  any  Lender  or any
Governmental  Authority for the account of any Lender  pursuant to Section 2.17,
or if any Lender  defaults in its obligation to fund Loans  hereunder,  then the
Company may, at its sole expense and effort,  upon notice to such Lender and the
Administrative  Agent,  require  such  Lender to assign  and  delegate,  without
recourse  (in  accordance  with and  subject to the  restrictions  contained  in
Section 9.05), all its interests, rights and obligations under this Agreement to
an assignee that shall assume such  obligations  (which  assignee may be another
Lender,  if a Lender  accepts such  assignment);  provided  that (i) the Company
shall have received the prior written consent of the Administrative Agent, which
consent shall not be unreasonably withheld, (ii) such Lender shall have received
payment of an amount equal to the  outstanding  principal of its Loans,  accrued
interest  thereon,  accrued fees and all other amounts  payable to it hereunder,
from the  assignee  (to the extent of such  outstanding  principal  and  accrued
interest  and fees) or the Company (in the case of all other  amounts) and (iii)
in the case of any such assignment resulting from a claim for compensation under
Section  2.15 or payments  required to be made  pursuant to Section  2.17,  such
assignment will result in a reduction in such compensation or payments. A Lender
shall not be required  to make any such  assignment  and  delegation  if,  prior
thereto, as a result of a waiver by such Lender or otherwise,  the circumstances
entitling the Company to require such assignment and delegation cease to apply.

          SECTION 2.20 Extensions of Termination Date;  Removal of Lenders.  (a)
The Company  may, by written  notice to the  Administrative  Agent (a "Notice of
Extension")  given  not  less  than 30 nor more  than 45 days  prior to the then
effective  Termination Date, advise the Lenders that it requests an extension of
the then effective  Termination Date (such then effective Termination Date being
the "Existing Termination Date") by 364 calendar days, effective on the Existing
Termination  Date.  The  Administrative  Agent will  promptly,  and in any event
within five Business Days of the receipt of such Notice of Extension, notify the
Lenders of the contents of each such Notice of Extension.

          (b)  Each  Notice  of  Extension  shall  (i) be  irrevocable  and (ii)
constitute a representation by the Company that (A) neither any Event of Default
nor any Default has occurred and is continuing,  and (B) the representations and
warranties contained in Article IV are correct on and as of such date, as though
made on and as of such date (unless any  representation  and warranty  expressly
relates to an  earlier  date).  In the event the  Existing  Termination  Date is
extended pursuant to the terms of this Section 2.20, the Company shall be deemed
to represent on and as of the effective  date of such extension that (i) neither
any Event of Default nor any Default has  occurred and is  continuing,  and (ii)
the representations and


                                      -37-
<PAGE>


warranties contained in Article IV are correct on and as of such date, as though
made on and as of such date (unless any  representation  and warranty  expressly
relates to an earlier date).

          (c) In the event a Notice of Extension is given to the  Administrative
Agent as provided in Section  2.20(a) and the  Administrative  Agent  notifies a
Lender of the contents thereof, such Lender shall on or before the 20th day next
preceding  the  Existing  Termination  Date advise the  Administrative  Agent in
writing whether or not such Lender consents to the extension  requested  thereby
and if any Lender fails so to advise the Administrative Agent, such Lender shall
be deemed to have not  consented to such  extension.  If Lenders  holding 80% or
more of the Total  Commitment  so consent  (the  "Consenting  Lenders")  to such
extension  and any and all Lenders who have not consented  (the  "Non-Consenting
Lenders")  are  replaced,  the  Termination  Date,  and the  Commitments  of the
Consenting  Lenders and the Nominees (as defined  below) shall be  automatically
extended 364 calendar days past the Existing  Termination Date, effective on the
Existing  Termination Date. The  Administrative  Agent shall promptly notify the
Company and all of the Lenders of each written  notice of consent given pursuant
to this Section 2.20(c).

          (d) In the event  the  Consenting  Lenders  hold less than 100% of the
Total Commitment,  the Consenting  Lenders, or any of them, shall have the right
(but not the  obligation)  to assume all or any  portion  of the  Non-Consenting
Lenders'   Commitments   by  giving  written  notice  to  the  Company  and  the
Administrative  Agent of their  election to do so on or before the 15th day next
preceding the Existing  Termination  Date, which notice shall be irrevocable and
shall  constitute an undertaking  to (i) assume,  as of the close of business on
the Existing  Termination  Date,  all or such portion of the  Commitments of the
Non-Consenting  Lenders, as the case may be, as may be specified in such written
notice, and (ii) purchase (without recourse) from the Non-Consenting Lenders, at
the close of business on the Existing  Termination  Date,  the Committed  Credit
Exposures  outstanding on the Existing  Termination  Date that correspond to the
portion of the  Commitments  to be so assumed at a price equal to the sum of (x)
the unpaid  principal  amount of all Loans so purchased,  plus (y) the aggregate
amount,  if any,  previously  funded by the transferor or any  participations so
purchased,  plus (z) all accrued and unpaid interest  thereon.  Such Commitments
and Committed Credit Exposures,  or portion thereof, to be assumed and purchased
by Consenting Lenders shall be allocated among those Consenting Lenders who have
so  elected  to  assume  the  same pro rata in  accordance  with the  respective
Commitments  of such  Consenting  Lenders as of the  Existing  Termination  Date
(provided,  however, in no event shall a Consenting Lender be required to assume
and  purchase  an amount or  portion of the  Commitments  and  Committed  Credit
Exposures  of the  Non-Consenting  Lenders  in excess of the  amount  which such
Consenting  Lender  agreed to assume and  purchase  pursuant to the  immediately
preceding  sentence)  or on such other  basis as such  Consenting  Lender  shall
agree. The Administrative  Agent shall promptly notify the Company and the other
Consenting  Lenders in the event it receives any notice from a Consenting Lender
pursuant to this Section 2.20(d).

          (e) In the  event  that the  Consenting  Lenders  shall  not  elect as
provided in Section  2.20(d) to assume and  purchase  all of the  Non-Consenting
Lenders' Commitments and Committed Credit Exposures,  the Company may designate,
by written notice to the  Administrative  Agent and the Consenting Lenders given
on or before the tenth day next preceding the Existing  Termination Date, one or
more Eligible Assignees not a party to this


                                      -38-
<PAGE>


Agreement (individually, a "Nominee" and collectively, the "Nominees") to assume
all or any portion of the Non-Consenting  Lenders' Commitments not to be assumed
by  the  Consenting   Lenders  and  to  purchase  (without  recourse)  from  the
Non-Consenting  Lenders all Committed Credit Exposures  outstanding at the close
of business on the Existing  Termination Date that corresponds to the portion of
the Commitments so to be assumed at the price specified in Section 2.20(d). Each
assumption and purchase under this Section  2.20(e) shall be effective as of the
close of business on the Existing  Termination  Date when each of the  following
conditions has been  satisfied in a manner  satisfactory  to the  Administrative
Agent:

          (i) each  Nominee  and the  Non-Consenting  Lenders  have  executed an
     Assignment and  Acceptance  pursuant to which such Nominee shall (A) assume
     in  writing  its share of the  obligations  of the  Non-Consenting  Lenders
     hereunder,  including its share of the  Commitments  of the  Non-Consenting
     Lenders  and (B)  agree  to be  bound  as a  Lender  by the  terms  of this
     Agreement; and

          (ii)  each  Nominee   shall  have   completed  and  delivered  to  the
     Administrative Agent an Administrative Questionnaire.

          (f) If all of the  Commitments of the  Non-Consenting  Lenders are not
replaced on or before the Existing  Termination  Date,  then, at the  Borrower's
option,  either  (i)  the  Total  Commitment  shall  terminate  on the  Existing
Termination Date or (ii) the Borrower shall give prompt notice of termination on
the Existing  Termination Date of the Commitments of each Non-Consenting  Lender
not so replaced to the  Administrative  Agent,  and shall prepay on the Existing
Termination Date the Loans, if any, of such Non-Consenting  Lenders, which shall
reduce the Total  Commitment  accordingly  (to the extent not assumed),  and the
Existing Termination Date shall be extended in accordance with this Section 2.20
for the remaining Commitments of the Consenting Lenders; provided, however, that
(A) Consenting  Lenders and Nominees shall have Committed  Credit  Exposures and
unused Commitments  representing more than 80% of the sum of the total Committed
Credit   Exposures  and  unused   Commitments   prior  to   replacement  of  the
Non-Consenting  Lenders and (B) no Lender after giving  effect to the  extension
contemplated hereunder shall have more than 20% of the Total Commitment.

                                  ARTICLE III.

                              CONDITIONS PRECEDENT

          SECTION  3.01  Conditions  Precedent  to  the Initial  Borrowing.  The
obligations of the Lenders to make Loans  hereunder  shall not become  effective
until the date on which each of the following  conditions is satisfied or waived
in accordance with Section 9.02:

          (a) The Administrative  Agent shall have received the following,  each
dated the Execution Date:

          (i)   this Agreement executed by each party hereto;

          (ii)  if requested by any Lender, a Committed  Note and a  Competitive
     Note executed by the Company and payable to the order of such Lender;


                                      -39-
<PAGE>


          (iii) a certificate of an officer and of the secretary or an assistant
     secretary of the Delegate,  certifying,  inter alia,  (A) true and complete
     copies of each of the limited  liability company agreement of the Delegate,
     the certificate of incorporation,  as amended and in effect, of the General
     Partner,  the  partnership  agreement,  as amended  and in  effect,  of the
     Company,  the bylaws,  as amended and in effect, of the General Partner and
     the  resolutions  adopted by the Board of  Directors  of the  Delegate  (1)
     authorizing the execution,  delivery and performance by the Company of this
     Agreement  and the other Loan  Documents  to which it is or will be a party
     and the  Borrowings  to be made  hereunder,  (2) approving the forms of the
     Loan  Documents  to which it is a party and which will be  delivered  at or
     prior to the initial  Borrowing  Date and (3)  authorizing  officers of the
     Delegate to execute and deliver the Loan  Documents to which the Company is
     or will be a party,  (B) the  incumbency  and  specimen  signatures  of the
     officers of the Delegate  executing any documents on its behalf and (C) (1)
     that the  representations  and warranties  made by the Company in each Loan
     Document to which the Company is a party and which will be  delivered at or
     prior to the initial  Borrowing  Date are true and correct in all  material
     respects,  (2)  the  absence  of any  proceedings  for the  dissolution  or
     liquidation  of the  Company  and (3) the  absence  of the  occurrence  and
     continuance of any Default or Event of Default;

          (iv) a letter from CT Corporation  System,  Inc. in form and substance
     satisfactory to the  Administrative  Agent  evidencing the obligation of CT
     Corporation  System,  Inc. to accept service of process in the State of New
     York on behalf of the Company;

          (v) a favorable,  signed opinion addressed to the Administrative Agent
     and the Lenders from Bracewell & Patterson, L.L.P., counsel to the Company,
     given upon the express instruction of the Company; and

          (vi) certificates of appropriate public officials as to the existence,
     good standing and  qualification  to do business as a foreign entity of the
     Company,  the General  Partner and the  Delegate in the States of Texas and
     Delaware.

          (b) The  Administrative  Agent shall be reasonably  satisfied that all
required  consents and  approvals of any  Governmental  Authority  and any other
Person in connection  with the  transactions  contemplated  by this Section 3.01
shall have been  obtained  and  remain in effect  (except  where the  failure to
obtain such approvals would not have a Material Adverse Effect).

          (c) The Company shall have paid to Wachovia Capital  Markets,  LLC and
the Administrative Agent all fees and expenses pursuant to the Fee Letter agreed
upon by such parties to be paid on or prior to the Execution Date.

          (d) The Existing  Credit  Agreement shall have been terminated and all
amounts outstanding thereunder paid in full.

          (e) The  Company  shall have paid to  Andrews  Kurth LLP  pursuant  to
Section 9.03 all reasonable fees and disbursements invoiced to the Company on or
prior to the Execution Date.


                                      -40-
<PAGE>


          SECTION 3.02 Conditions  Precedent to All Borrowings.  The obligations
of the Lenders to make any Loans  hereunder  (including  any Loans to be made on
the initial Borrowing Date) is subject to the further conditions  precedent that
on the date of such Borrowing:

          (a) The  conditions  precedent  set forth in  Section  3.01 shall have
theretofore been satisfied;

          (b) The  representations and warranties set forth in Article IV (other
than the  representation  set forth in  Section  4.07(c))  and in the other Loan
Documents  shall be true and correct in all  material  respects as of, and as if
such  representations  and  warranties  were made on, the Borrowing  Date of the
proposed Loan (unless such  representation  and warranty expressly relates to an
earlier date), and by the Company's  delivery of a Borrowing Request the Company
shall be deemed to have  certified to the  Administrative  Agent and the Lenders
that such  representations  and  warranties are true and correct in all material
respects;

          (c) The Company  shall have  complied  with the  provisions of Section
2.03 or Section 2.04, as the case may be; and

          (d) No  Default  or  Event  of  Default  shall  have  occurred  and be
continuing or would result from such Borrowing.

The   acceptance  of  the  benefits  of  each  Borrowing   shall   constitute  a
representation  and  warranty by the Company to each of the Lenders  that all of
the conditions specified in this Section 3.02 above exist as of that time.

          SECTION 3.03 Conditions  Precedent to  Conversions.  The obligation of
the  Lenders  to  convert  or  continue  any  existing  Borrowing  into  or as a
Eurodollar  Borrowing is subject to the condition  precedent that on the date of
such  conversion  or  continuation  no Default  or Event of  Default  shall have
occurred and be continuing  or would result from the making of such  conversion.
The  acceptance of the benefits of each such  conversion or  continuation  shall
constitute a  representation  and warranty by the Company to each of the Lenders
that no Default or Event of Default  shall have  occurred and be  continuing  or
would result from the making of such conversion or continuation.

          SECTION  3.04  Delivery  of  Documents.  All  of the  Loan  Documents,
certificates,  legal opinions and other documents and papers referred to in this
Article   III,   unless   otherwise   specified,   shall  be  delivered  to  the
Administrative  Agent for the account of each of the Lenders and, except for any
Notes, in sufficient counterparts or copies for each of the Lenders and shall be
satisfactory in form and substance to the Lenders.

                                  ARTICLE IV.

                         REPRESENTATIONS AND WARRANTIES

      The Company  makes the  following  representations  and  warranties to the
Administrative Agent and the Lenders:


                                      -41-
<PAGE>


          SECTION 4.01 Organization and  Qualification.  The Company and each of
the Subsidiaries (a) is a corporation,  partnership or limited liability company
duly organized or formed,  validly  existing and in good standing under the laws
of the  state  of its  incorporation,  organization  or  formation,  (b) has all
requisite corporate,  partnership,  limited liability company or other power and
all material  governmental  licenses,  authorizations,  consents  and  approvals
required to carry on its business as now conducted and (c) is duly  qualified to
do business and is in good standing in every  jurisdiction  in which the failure
to be so qualified would,  individually or together with all such other failures
of the Company and the  Subsidiaries,  have a Material Adverse Effect. As of the
date of this  Agreement,  the Persons and other  entities shown on Schedule 4.01
are  all  of the  Subsidiaries  of the  Company,  and  such  Schedule  4.01  (x)
accurately  reflects  the  direct  owner  of the  Capital  Stock  of  each  such
Subsidiary  owned  by  such  direct  owner,   (y)  accurately   identifies  such
Subsidiaries and (z) accurately sets forth the jurisdictions of their respective
incorporation, organization or formation, as the case may be.

          SECTION  4.02  Authorization,  Validity,  Etc.  The  Company  has  all
requisite  partnership and other power and authority to execute and deliver, and
to incur and perform its  obligations  under this  Agreement and under the other
Loan Documents to which it is a party and to make the Borrowings hereunder,  and
all such actions have been duly  authorized by all necessary  proceedings on its
behalf.  This  Agreement and the other Loan Documents have been duly and validly
executed and delivered by or on behalf of the Company and  constitute  valid and
legally  binding  agreements of the Company  enforceable  against the Company in
accordance  with the respective  terms thereof,  except (a) as may be limited by
bankruptcy,   insolvency,   reorganization,   moratorium,  fraudulent  transfer,
fraudulent  conveyance  or other  similar  laws  relating  to or  affecting  the
enforcement of creditors' rights generally,  and by general principles of equity
(including  principles  of good  faith,  reasonableness,  materiality  and  fair
dealing)  which may,  among other  things,  limit the right to obtain  equitable
remedies  (regardless of whether considered in a proceeding in equity or at law)
and (b) as to the enforceability of provisions for indemnification for violation
of applicable securities laws, limitations thereon arising as a matter of law or
public policy.

          SECTION 4.03 Governmental  Consents,  Etc. No authorization,  consent,
approval,  license or exemption of or  registration,  declaration or filing with
any  Governmental  Authority,  is necessary for the valid execution and delivery
of, or the incurrence and performance by the Company of its  obligations  under,
any Loan  Document to which it is a party,  except those that have been obtained
and such matters  relating to  performance  as would  ordinarily  be done in the
ordinary course of business after the Execution Date.

          SECTION  4.04 No Breach or Violation of  Agreements  or  Restrictions,
Etc.  Neither the execution and delivery of, nor the incurrence and  performance
by the Company of its  obligations  under,  the Loan  Documents to which it is a
party, nor the extensions of credit contemplated by the Loan Documents, will (a)
breach or violate any applicable Requirement of Law, (b) result in any breach or
violation  of any of the  terms,  covenants,  conditions  or  provisions  of, or
constitute a default  under,  or result in the creation or imposition of (or the
obligation  to create or  impose)  any Lien upon any of its  property  or assets
(other than Liens created or  contemplated  by this  Agreement)  pursuant to the
terms of, any indenture,  mortgage, deed of trust, agreement or other instrument
to  which  it or  any  of the  Subsidiaries  is  party  or by  which  any of its
properties or assets,  or those of any of the  Subsidiaries is bound or to which
it is


                                      -42-
<PAGE>


subject, except for breaches,  violations and defaults under clauses (a) and (b)
that neither  individually  nor in the aggregate could reasonably be expected to
result in a Material Adverse Effect, or (c) violate any provision of the organic
documents of the Company.

          SECTION 4.05 Properties.  Each of the Company and the Subsidiaries has
good  title to,  or valid  leasehold  or other  interests  in,  all its real and
personal  property  material to its business,  except for Liens  permitted under
Section 6.01.

          SECTION  4.06  Litigation  and  Environmental  Matters.  (a) Except as
disclosed in the most recent Annual Report on Form 10-K delivered by the Company
to the  Lenders,  there  is no  action,  suit or  proceeding  by or  before  any
arbitrator or Governmental Authority pending against or, to the knowledge of the
Company,  threatened against or affecting the Company or any of the Subsidiaries
(i) as to which there is a reasonable  possibility  of an adverse  determination
and that, if adversely  determined,  could reasonably be expected to result in a
Material   Adverse   Effect  or  (ii)  that  involves  this   Agreement  or  the
Transactions.

          (b) In the ordinary  course of its business,  the Company  conducts an
ongoing review of the effect of Environmental  Laws on the business,  operations
and  properties of the Company and the  Subsidiaries,  in the course of which it
identifies and evaluates associated liabilities and costs (including any capital
or  operating  expenditures  required  for  clean-up  or closure  of  properties
currently or previously owned, any capital or operating expenditures required to
achieve or maintain compliance with environmental  protection  standards imposed
by law or as a  condition  of any  license,  permit  or  contract,  any  related
constraints  on  operating  activities,  including  any  periodic  or  permanent
shutdown of any facility or reduction in the level of or change in the nature of
operations  conducted  thereat,  any costs or  liabilities  in  connection  with
off-site disposal of wastes or Hazardous Materials,  and any actual or potential
liabilities to third  parties,  including  employees,  and any related costs and
expenses).  On the basis of this review,  the Company has  reasonably  concluded
that such associated  liabilities  and costs,  including the costs of compliance
with Environmental Laws, are unlikely to result in a Material Adverse Effect.

          SECTION 4.07 Financial Statements.  (a) The consolidated balance sheet
of the Company  and the  Subsidiaries  as at  December  31, 2002 and the related
consolidated statements of income,  comprehensive income,  partners' capital and
cash flows of the Company and the Subsidiaries for the fiscal year ended on said
date,  with the opinion thereon of  PricewaterhouseCoopers  LLP and set forth in
the Company's  2002 Annual  Report on Form 10-K,  as filed with the SEC,  fairly
present,  in conformity with GAAP, the  consolidated  financial  position of the
Company and the Subsidiaries as of such date and their  consolidated  results of
operations and cash flows for such fiscal year.

          (b) The unaudited  consolidated  balance sheets of the Company and the
Subsidiaries  as at June 30, 2003 and the  related  consolidated  statements  of
income and cash flows of the  Company  and the  Subsidiaries  for the  six-month
period  ended on such date and set forth in the  Company's  Quarterly  Report on
Form 10-Q for its fiscal  quarter  then  ended,  as filed  with the SEC,  fairly
present,  in  conformity  with  GAAP  applied  on a basis  consistent  with  the
financial statements referred to in Section 4.07(a), the consolidated  financial
position  of the  Company  and  the  Subsidiaries  as at  said  date  and  their
consolidated results of their operations


                                      -43-
<PAGE>


cash flows for the  six-month  period ended on said date (subject to the absence
of footnotes and to normal year-end and audit adjustments).

          (c) Since December 31, 2002, there has been no material adverse change
in the business,  assets,  liabilities or financial condition of the Company and
the Subsidiaries, taken as a whole.

          SECTION 4.08 Disclosure.  All information  heretofore furnished by the
Company  to  the  Administrative  Agent  or any  Lender  for  purposes  of or in
connection  with this Agreement or any transaction  contemplated  hereby is, and
all such information  hereafter  furnished by the Company to the  Administrative
Agent or any Lender will be, true and accurate in all  material  respects on the
date as of which such  information is stated or certified.  None of the reports,
financial  statements,  certificates  or other  information  furnished  by or on
behalf of the Company to the  Administrative  Agent or any Lender in  connection
with the syndication or negotiation of this Agreement or delivered hereunder (as
modified  or  supplemented  by other  information  so  furnished)  contains  any
material  misstatement  of fact or omits to state any material fact necessary to
make the statements  therein, in the light of the circumstances under which they
were made, not misleading.

          SECTION 4.09  Investment  Company Act.  Neither the Company nor any of
the Subsidiaries  is, or is regulated as, an "investment  company," as such term
is defined in the Investment Company Act of 1940, as amended.

          SECTION 4.10 Public Utility Holding  Company Act.  Neither the Company
nor any of the  Subsidiaries is a non-exempt  "holding  company",  or subject to
regulation as such, or an  "affiliate"  of a "holding  company" or a "subsidiary
company"  of a  "holding  company",  within the  meaning  of the Public  Utility
Holding Company Act of 1935, as amended.

          SECTION 4.11 ERISA.  Each member of the ERISA Group has  fulfilled its
obligations  under  the  minimum  funding  standards  of ERISA and the Code with
respect to each Plan and is in  compliance  in all  material  respects  with the
presently applicable provisions of ERISA and the Code with respect to each Plan.
No member of the ERISA  Group  has (i)  sought a waiver of the  minimum  funding
standard  under  Section 412 of the Code in respect of any Plan,  (ii) failed to
make any contribution or payment to any Plan or Multiemployer Plan or in respect
of any  Benefit  Arrangement,  or made  any  amendment  to any  Plan or  Benefit
Arrangement,  which has resulted or could result in the  imposition of a Lien or
the  posting  of a bond or  other  security  under  ERISA  or the  Code or (iii)
incurred  any  liability  under Title IV of ERISA other than a liability  to the
PBGC for  premiums  under  Section  4007 of  ERISA,  which  waiver,  failure  or
liability could reasonably be expected to result in a Material Adverse Effect.

          SECTION   4.12  Tax  Returns  and   Payments.   The  Company  and  the
Subsidiaries  have caused to be filed all  federal  income tax returns and other
material  tax  returns,  statements  and reports (or  obtained  extensions  with
respect  thereto)  which are  required to be filed and have paid or deposited or
made  adequate  provision in  accordance  with GAAP for the payment of all taxes
(including estimated taxes shown on such returns,  statements and reports) which
are shown to be due pursuant to such returns,  except for taxes being  contested
in good


                                      -44-
<PAGE>


faith by appropriate  proceedings for which adequate reserves in accordance with
GAAP have been  created on the books of the  Company  and the  Subsidiaries  and
where the failure to pay such taxes  (individually  or in the  aggregate for the
Company and the Subsidiaries) would not have a Material Adverse Effect.

          SECTION 4.13 Compliance with Laws and Agreements.  Each of the Company
and the  Subsidiaries is in compliance with all laws,  regulations and orders of
any Governmental  Authority applicable to it or its property and all indentures,
agreements and other instruments  binding upon it or its property,  except where
the failure to do so,  individually  or in the aggregate for the Company and the
Subsidiaries,  could not reasonably be expected to result in a Material  Adverse
Effect.

          SECTION 4.14  Purpose of Loans.  (a) All proceeds of the Loans will be
used for the purposes set forth in Section 5.07.

          (a) None of the  proceeds  of the  loans  under  the  Existing  Credit
Agreement or the Related Credit Agreement (as defined therein) were, and none of
the proceeds of the Loans under this Agreement or the Related  Credit  Agreement
will be, used directly or  indirectly  for the purpose of buying or carrying any
"margin stock" within the meaning of Regulation U (herein called "margin stock")
or for the purpose of reducing or retiring any indebtedness which was originally
incurred to buy or carry any margin stock,  or for any other purpose which might
constitute this  transaction a "purpose" credit within the meaning of Regulation
T, U or X.  Neither the Company nor any agent  acting on its behalf has taken or
will take any action which might cause this Agreement or any other Loan Document
or  the  Related  Credit  Agreement  to  violate  Regulation  T,  Regulation  U,
Regulation  X, or any other  regulation  of the Board or to violate the Exchange
Act.  Margin  stock  does not  constitute  more  than 25% of the  assets  of the
Company, or of the Company and the Subsidiaries on a consolidated basis, and the
Company does not intend or foresee that it will ever do so.

                                   ARTICLE V.

                              AFFIRMATIVE COVENANTS

      Until the Commitments have expired or been terminated and the principal of
and interest on each Loan and all fees payable hereunder shall have been paid in
full, the Company covenants and agrees with the Lenders that:

          SECTION 5.01 Financial  Statements and Other Information.  The Company
will furnish to the  Administrative  Agent, in each case with sufficient  copies
for each Lender:

          (a) within  three days after the date in each fiscal year on which the
Company is required to file its Annual Report on Form 10-K with the SEC (i) such
Annual Report, and (ii) its audited  consolidated  balance sheet and the related
consolidated statements of income,  comprehensive income, operations,  partners'
capital and cash flows as of the end of and for such year, setting forth in each
case in  comparative  form  the  figures  as of the end of and for the  previous
fiscal year, all reported on by PricewaterhouseCoopers LLP, or other independent


                                      -45-
<PAGE>


public accountants of recognized national standing (without a "going concern" or
like qualification or exception and without any qualification or exception as to
the  scope of their  audit)  to the  effect  that  such  consolidated  financial
statements  present  fairly in all  material  respects the  financial  position,
results of operations  and cash flows of the Company and the  Subsidiaries  on a
consolidated  basis in accordance  with GAAP;  provided,  however,  that (x) the
Company  shall be deemed to have  furnished  said Annual Report on Form 10-K for
purposes  of clause  (i) if it shall  have  timely  made the same  available  on
"EDGAR"  and/or  on its  home  page on the  worldwide  web (at the  date of this
Agreement  located at  http://www.kindermorgan.com)  and complied  with the last
grammatical  paragraph of this Section 5.01 in respect thereof,  and (y) if said
Annual Report  contains such  consolidated  balance sheet and such  consolidated
statements of results of income,  comprehensive  income,  partners'  capital and
cash  flows,  and the report  thereon  of such  independent  public  accountants
(without qualification or exception, and to the effect, as specified above), the
Company shall not be required to comply with clause (ii);

          (b) within three days after each date in each fiscal year on which the
Company is  required  to file a  Quarterly  Report on Form 10-Q with the SEC (i)
such Quarterly Report,  and (ii) its consolidated  balance sheet and the related
consolidated  statements  of income  and cash flows as of the end of and for the
fiscal  quarter to which said  Quarterly  Report  relates  and the then  elapsed
portion of the fiscal year,  setting forth in each case in comparative  form the
figures  as of the end  and  for the  corresponding  period  or  periods  of the
previous  fiscal year,  all  certified by a  Responsible  Officer as  presenting
fairly  in  all  material  respects  the  financial  condition  and  results  of
operations  of the  Company  and the  Subsidiaries  on a  consolidated  basis in
accordance  with GAAP,  subject to normal  year-end  audit  adjustments  and the
absence of footnotes; provided, however, that (x) the Company shall be deemed to
have furnished said Quarterly Report for purposes of clause (i) if it shall have
timely  made  the same  available  on  "EDGAR"  and/or  on its home  page on the
worldwide    web   (at    the    date   of    this    Agreement    located    at
http://www.kindermorgan.com) and complied with the last grammatical paragraph of
this Section 5.01 in respect thereof,  and (y) if said Quarterly Report contains
such consolidated  balance sheet and consolidated  statements of income and cash
flows, and such certifications, the Company shall not be required to comply with
clause (ii);

          (c)  simultaneously  with  the  delivery  of  each  set  of  financial
statements  referred  to  in  clauses  (a)  and  (b)  above,  a  certificate  in
substantially  the form of Exhibit  5.01 signed by an  authorized  financial  or
accounting  officer of the Company (i) setting  forth in  reasonable  detail the
calculations  required to establish  whether the Company was in compliance  with
the  requirements  of  Section  6.06(a),  (b),  (c) and (d) on the  date of such
financial  statements  and (ii) stating  whether any Default or Event of Default
exists on the date of such  certificate  and, if any Default or Event of Default
then exists,  setting forth the details thereof and the action which the Company
is taking or proposes to take with respect thereto;

          (d)  simultaneously  with  the  delivery  of  each  set  of  financial
statements  referred  to in  clause  (a)  above,  a  statement  of the  firm  of
independent  public  accountants  which  reported on such  statements  (i) as to
whether  anything has come to their  attention to cause them to believe that any
Default or Event of  Default  existed  on the date of such  statements  and (ii)
confirming the  calculations  set forth in the officer's  certificate  delivered
simultaneously  therewith pursuant to clause (c) above; provided,  however, that
such  accountants  shall not be liable to anyone by reason of their  failure  to
obtain knowledge of any Default or Event of Default


                                      -46-
<PAGE>


which  would  not  be  disclosed  in  the  course  of  an  audit  conducted  in
accordance with generally accepted auditing standards;

          (e) prompt written notice of the following:

          (i)  the occurrence  of any  Default  or Event of Default or Change in
     Control Event and

          (ii) any other  development  that results in, or could  reasonably  be
     expected to result in, a Material Adverse Effect;

(each  notice  delivered  under  this  Section  5.01(e) to be  accompanied  by a
statement of a  Responsible  Officer  setting  forth the details of the event or
development  requiring  such notice and any action taken or proposed to be taken
with respect thereto);

          (f)  promptly  upon  receipt  thereof,  a copy of each other report or
letter  submitted to the Company by independent  accountants in connection  with
any annual,  interim or special  audit made by them of the books of the Company,
and a copy of any  response by the  Company,  or the Board of  Directors  of the
general partner of the Company, to such letter or report;

          (g) without duplication of any other requirement of this Section 5.01,
promptly  upon the  mailing  thereof to the public  unitholders  of the  Company
generally,  copies of all financial statements,  reports and proxy statements so
mailed;

          (h)  promptly  upon the  filing  thereof  with the SEC,  copies of all
registration  statements  (other than the exhibits  thereto and any registration
statements  on Form S-8 or its  equivalent)  and  reports  on Form 8-K which the
Company shall have filed with the SEC;

          (i) if and when any member of the ERISA Group (i) gives or is required
to give notice to the PBGC of any "reportable event" (as defined in Section 4043
of ERISA)  (other than such event as to which the 30-day notice  requirement  is
waived)  with  respect  to  any  Plan  which  might  constitute  grounds  for  a
termination  of such  Plan  under  Title IV of  ERISA,  or  knows  that the plan
administrator  of any Plan has given or is  required  to give notice of any such
reportable  event,  a copy of the  notice  of such  reportable  event  given  or
required to be given to the PBGC;  (ii)  receives  notice of complete or partial
withdrawal  liability  under Title IV of ERISA or notice that any  Multiemployer
Plan is in reorganization,  is insolvent or has been terminated,  a copy of such
notice; (iii) receives notice from the PBGC under Title IV of ERISA of an intent
to terminate,  impose  liability  (other than for premiums under Section 4007 of
ERISA) in respect  of, or appoint a trustee to  administer  any Plan,  a copy of
such notice;  (iv) applies for a waiver of the minimum  funding  standard  under
Section 412 of the Code, a copy of such application;  (v) gives notice of intent
to terminate any Plan under Section  4041(c) of ERISA, a copy of such notice and
other  information filed with the PBGC; (vi) gives notice of withdrawal from any
Plan pursuant to Section 4063 of ERISA, a copy of such notice; or (vii) fails to
make any payment or contribution to any Plan or Multiemployer Plan or in respect
of any  Benefit  Arrangement  or makes  any  amendment  to any  Plan or  Benefit
Arrangement  which has resulted or could result in the  imposition  of a Lien or
the posting of a bond or other  security,  a certificate of the chief  financial
officer or the chief accounting officer of the Company setting


                                      -47-
<PAGE>


forth details as to such  occurrence  and action,  if any,  which the Company or
applicable member of the ERISA Group is required or proposes to take; and

          (j) from time to time such other  information  regarding the business,
affairs or financial  condition of the Company or any Subsidiary as the Required
Lenders or the Administrative Agent may reasonably request.

           Information  required to be  delivered  pursuant to Section  5.01(a),
5.01(b),  5.01(g) or 5.01(h) above shall be deemed to have been delivered on the
date on which the Company  provides notice to the  Administrative  Agent and the
Lenders  that such  information  has been  posted on  "EDGAR"  or the  Company's
website or another  website  identified  in such  notice and  accessible  by the
Administrative  Agent and the Lenders  without  charge  (and the Company  hereby
agrees to provide such  notice);  provided that such notice may be included in a
certificate delivered pursuant to Section 5.01(c).

          SECTION 5.02  Existence,  Conduct of Business.  The Company will,  and
will  cause  each of the  Material  Subsidiaries  to, do or cause to be done all
things necessary to preserve,  renew and keep in full force and effect its legal
existence and the rights, licenses,  permits, privileges and franchises material
to the conduct of its business;  provided that the foregoing  shall not prohibit
any merger,  consolidation,  liquidation or dissolution  permitted under Section
6.02.

          SECTION 5.03 Payment of Obligations.  The Company will, and will cause
each of the Subsidiaries to, pay, before the same shall become  delinquent or in
default,  its obligations,  including tax liabilities,  that, if not paid, could
result in a Material  Adverse  Effect,  except  where (a) the validity or amount
thereof is being  contested in good faith by  appropriate  proceedings,  (b) the
Company or such  Subsidiary  has set aside on its books  adequate  reserves with
respect  thereto in  accordance  with GAAP,  and (c) the failure to make payment
pending such contest  could not  reasonably  be expected to result in a Material
Adverse Effect.

          SECTION 5.04  Maintenance  of Properties;  Insurance.  (a) The Company
will keep, and will cause each Material  Subsidiary to keep, all property useful
and necessary in its business in good working order and condition, ordinary wear
and tear excepted.

          (b) The Company will maintain or cause to be  maintained  with, in the
good faith judgment of the Company, financially sound and reputable insurers, or
through  self-insurance,  insurance  with respect to its properties and business
and the properties and businesses of the Subsidiaries  against loss or damage of
the kinds  customarily  insured  against by business  enterprises of established
reputation  engaged in the same or similar business and similarly  situated,  of
such  types  and in  such  amounts  as are  customarily  carried  under  similar
circumstances   by  such  other   corporations.   Such   insurance  may  include
self-insurance  or be subject to co-insurance,  deductibility or similar clauses
which, in effect, result in self-insurance of certain losses, provided that such
self-insurance is in accord with the approved practices of business  enterprises
of established reputation similarly situated and adequate insurance reserves are
maintained in connection  with such  self-insurance,  and,  notwithstanding  the
foregoing  provisions  of this  Section 5.04 the Company or any  Subsidiary  may
effect workers'  compensation  or similar  insurance in respect of operations in
any state or other jurisdiction either


                                      -48
<PAGE>


through an insurance  fund  operated by such state or other  jurisdiction  or by
causing to be  maintained a system or systems of  self-insurance  in accord with
applicable laws.

          SECTION 5.05 Books and Records;  Inspection  Rights. The Company will,
and will cause each of the  Subsidiaries  to,  keep  proper  books of record and
account in which full,  true and correct  entries are made of all  dealings  and
transactions in relation to its business and  activities.  The Company will, and
will cause each of the Subsidiaries to, permit any representatives designated by
the  Administrative  Agent or any Lender,  upon  reasonable  prior notice during
normal business hours, to visit and inspect its properties,  to examine and make
extracts from its books and records (subject to compliance with  confidentiality
agreements and applicable  copyright law), and to discuss its affairs,  finances
and condition with its officers and independent accountants,  all at such times,
and as often, as reasonably requested.

          SECTION 5.06  Compliance  with Laws.  The Company will, and will cause
each of the  Subsidiaries  to, comply with all Requirements of Law applicable to
it or its property,  except where the failure to do so,  individually  or in the
aggregate,  could not  reasonably  be expected  to result in a Material  Adverse
Effect.

          SECTION 5.07 Use of  Proceeds.  The proceeds of the Loans will be used
only for (a)  refinancing  (i) amounts  outstanding  under the  Existing  Credit
Agreement,  (ii) other  Indebtedness  of the Company and its  Subsidiaries,  and
(iii) commercial  paper,  and (b) working capital and other general  partnership
purposes.

                                  ARTICLE VI.

                               NEGATIVE COVENANTS

      Until the Commitments  have expired or terminated and the principal of and
interest on each Loan and all fees payable hereunder have been paid in full, the
Company covenants and agrees with the Lenders that:

          SECTION  6.01  Liens.  The Company  will not,  and will not permit any
Subsidiary to, create, incur, assume or permit to exist any Lien on any property
or asset now owned or hereafter  acquired by it, or assign or sell any income or
revenues  (including  accounts  receivable) or rights in respect of any thereof,
except:

          (a) Permitted Encumbrances;

          (b) Liens  existing on any property or asset prior to the  acquisition
     thereof by the Company or any  Subsidiary  or  existing on any  property or
     asset of any Person that becomes a  Subsidiary  after the date hereof prior
     to the time such Person  becomes a  Subsidiary  and  securing  Indebtedness
     whose incurrence,  for purposes of this Agreement, by virtue of acquisition
     of such  property  or  asset,  or by virtue of such  Person so  becoming  a
     Subsidiary, would not result in a violation of Section 6.06(a), (b), (c) or
     (d);  provided that (i) such Lien is not created in  contemplation of or in
     connection with such  acquisition or such Person becoming a Subsidiary,  as
     the case may be,  (ii) such Lien shall not apply to any other  property  or
     assets of the Company or any Subsidiary,  (iii) such Lien shall secure only
     those obligations which it secures on the date


                                      -49-
<PAGE>


of such  acquisition or the date such Person  becomes a Subsidiary,  as the case
may be, and extensions,  renewals and replacements  thereof that do not increase
the outstanding  principal amount thereof. For purposes of this Section 6.01(b),
the  Indebtedness  so secured  shall be deemed to have been incurred on the last
day of the fiscal quarter then most recently ended.

          (c) Liens,  not otherwise  permitted by the foregoing  clauses (a) and
(b),  securing  Indebtedness  and  payment  obligations  in  respect  of Hedging
Agreements in an aggregate amount not exceeding 10% of Tangible Net Worth.

          SECTION 6.02 Fundamental  Changes.  The Company will not, and will not
permit any Subsidiary to, merge into or  consolidate  with any other Person,  or
permit any other Person to merge into or consolidate with it, or sell, transfer,
lease  or  otherwise   dispose  of  (in  one  transaction  or  in  a  series  of
transactions) all (or substantially  all) of its assets, or all or substantially
all of the stock of or other equity interest in any of the Subsidiaries (in each
case,  whether now owned or  hereafter  acquired),  or  liquidate  or  dissolve,
unless:  (a) at the time thereof and immediately  after giving effect thereto no
Event of Default or Default shall have occurred and be  continuing;  and (b) the
Company is the  surviving  entity or the  recipient of any such sale,  transfer,
lease  or  other  disposition  of  assets,   provided,   that  no  such  merger,
consolidation,  sale, transfer, lease or other disposition shall have the effect
of releasing the Company from any of the Obligations.

          SECTION 6.03 Restricted  Payments.  The Company will not, and will not
permit any of the  Subsidiaries  to,  declare or make,  or agree to pay or make,
directly or indirectly, any Restricted Payment.

          SECTION 6.04 Transactions  with Affiliates.  The Company will not, and
will not permit any of the Subsidiaries  to, sell,  lease or otherwise  transfer
any property or assets to, or purchase,  lease or otherwise acquire any property
or assets from, or otherwise engage in any other  transactions  with, any of its
Affiliates, except (a) in the ordinary course of business at prices and on terms
and conditions not less favorable to the Company or such  Subsidiary  than could
be  obtained  on  an  arm's-length  basis  from  unrelated  third  parties,  (b)
transactions between or among the Company and the Wholly-owned  Subsidiaries not
involving  any  other  Affiliate,  (c) any  payment  which  would  constitute  a
Restricted Payment but for the proviso to the definition of said term in Section
1.01 and (d) loans and advances by the Company to the General  Partner to enable
the  General  Partner  to pay  general  and  administrative  costs and  expenses
pursuant to the partnership agreement of the Company and in accordance with past
practices.

          SECTION 6.05  Restrictive  Agreements.  The Company will not, and will
not permit any of the Subsidiaries to, directly or indirectly, enter into, incur
or permit to exist any agreement or other arrangement that prohibits,  restricts
or imposes any condition  upon the ability of any Subsidiary to pay dividends or
other  distributions  with respect to any shares of its Capital Stock or to make
or repay loans or advances to the Company or any other such Subsidiary, provided
that the foregoing shall not apply to (a) restrictions and conditions imposed by
law or by  this  Agreement  or  the  Related  Credit  Agreement,  (b)  customary
restrictions and conditions  contained in agreements relating to the sale of all
or substantially all of the Capital Stock or assets of a Subsidiary pending such
sale,  provided such  restrictions  and conditions  apply only to the Subsidiary
that is to be sold and such sale is permitted hereunder, (c) restrictions and


                                      -50-
<PAGE>


conditions  existing on the date hereof  identified  on Schedule 6.05 (but shall
apply to any extension or renewal of, or any amendment or modification expanding
the scope of,  any such  restriction  or  condition)  and (d)  restrictions  and
conditions  contained in the agreement pursuant to which the SFPP First Mortgage
Notes were issued.

          SECTION 6.06 Financial  Covenants.  The Company will observe and cause
the Subsidiaries to observe each of the following requirements:

          (a) Ratio of Consolidated  Indebtedness to  Consolidated  EBITDA.  The
Company will not at any time permit the ratio of  Consolidated  Indebtedness  to
Consolidated  EBITDA for the four full fiscal  quarters most  recently  ended in
respect of which  financial  statements  shall have been  delivered  pursuant to
Section  5.01(a) or (b), as the case may be, to exceed 5.00 to 1.0. For purposes
of this Section  6.06(a),  if during any period the Company  acquires any Person
(or any interest in any Person) or all or substantially all of the assets of any
Person,  the  EBITDA  attributable  to such  assets  or an  amount  equal to the
percentage  of  ownership of the Company in such Person times the EBITDA of such
Person, for such period determined on a pro forma basis (which determination, in
each case,  shall be subject to  approval  of the  Required  Lenders,  not to be
unreasonably  withheld) may be included as Consolidated  EBITDA for such period,
if on the date of such  acquisition  no  Indebtedness  (other than  Indebtedness
permitted  pursuant  to  Section  6.06(b) or (d)) is  incurred  by reason of and
giving effect to such acquisition and such Person,  or the entity acquiring such
assets,  as the case may be,  is a  Subsidiary.  For  purposes  of  ascertaining
whether  the  Required  Lenders  have  approved  a  determination  of the EBITDA
attributable  to  acquired  assets,  or the assets of an  acquired  Person,  for
inclusion  in  Consolidated  EBITDA for any  period  pursuant  to the  foregoing
sentence,  a Lender  which has not,  within 10 days  after  its  receipt  of the
certificate  of a Responsible  Officer  required by the last sentence of Section
5.01,  objected to the inclusion in Consolidated  EBITDA as set forth therein of
an amount of EBITDA  attributable  to such acquired assets or the assets of such
acquired  Person,  as the case may be, shall be deemed to have approved both the
determination of such amount of EBITDA so included, and the inclusion thereof in
Consolidated EBITDA pursuant to the foregoing sentence.

          (b)  Total  Indebtedness  (excluding  Indebtedness  of a  consolidated
Subsidiary  owed  to the  Company  or to  any  Wholly-owned  Subsidiary)  of all
consolidated   Subsidiaries   shall  at  no  time  exceed  15%  of  Consolidated
Indebtedness.

          (c) Tangible Net Worth as at the last day of any fiscal  quarter shall
not be less than $2,100,000,000.

          (d) Consolidated  Indebtedness  shall at no time exceed 62.5% of Total
Capitalization.

                                  ARTICLE VII.

                                EVENTS OF DEFAULT

          SECTION 7.01 Events of Default and  Remedies.  If any of the following
events ("Events of Default") shall occur and be continuing:


                                      -51-
<PAGE>


          (a) the  principal  of any Loan shall not be paid when and as the same
shall become due and payable, whether at the due date thereof or at a date fixed
for prepayment thereof or otherwise;

          (b) any  interest  on any Loan or any fee or any other  amount  (other
than an amount  referred to in clause (a) of this  Article)  payable  under this
Agreement  or any other Loan  Document  shall not be paid,  when and as the same
shall become due and payable,  and such failure shall continue  unremedied for a
period of three Business Days;

          (c) any  representation  or warranty  made or, for purposes of Article
III, deemed made by or on behalf of the Company herein,  at the direction of the
Company  or by the  Company  in any  other  Loan  Document  or in any  document,
certificate or financial  statement  delivered in connection with this Agreement
or any other Loan  Document  shall prove to have been  incorrect in any material
respect when made or deemed made or reaffirmed, as the case may be;

          (d) the  Company  shall  fail to  observe  or  perform  any  covenant,
condition or agreement  contained in Section  5.01(e)(i),  5.02 (with respect to
the Company's existence) or 5.07 or in Article VI;

          (e) the  Company  shall fail to perform  or  observe  any other  term,
covenant or agreement contained in this Agreement (other than those specified in
Section 7.01(a),  Section 7.01(b) or Section 7.01(d)) or any other Loan Document
to which it is a party and, in any event,  such failure shall remain  unremedied
for 30 calendar  days after the earlier of (i)  written  notice of such  failure
shall have been given to the Company by the  Administrative  Agent or any Lender
or, (ii) a Responsible Officer of the Company becomes aware of such failure;

          (f) other than as specified in Section 7.01(a) or (b), (i) the Company
or any Subsidiary  fails to make (whether as primary  obligor or as guarantor or
other  surety) any payment of principal  of, or interest or premium,  if any, on
any item or items of Indebtedness (other than as specified in Section 7.01(a) or
Section  7.01(b)) or any payment in respect of any Hedging  Agreement beyond any
period of grace provided with respect thereto (not to exceed 30 days);  provided
that the aggregate  outstanding  principal amount of all Indebtedness or payment
obligations  in respect  of all  Hedging  Agreements  as to which such a payment
default  shall occur and be continuing  is equal to or exceeds  $25,000,000,  or
(ii) the Company or any Subsidiary fails to duly observe, perform or comply with
any  agreement  with any Person or any term or condition of any  instrument,  if
such failure,  either  individually or in the aggregate,  shall have resulted in
the  acceleration of the payment of  Indebtedness  with an aggregate face amount
which is equal to or exceeds  $25,000,000;  provided  that this Section  7.01(f)
shall not apply to  secured  Indebtedness  that  becomes  due as a result of the
voluntary sale or transfer of the property or assets securing such  Indebtedness
so long as such Indebtedness is paid in full when due;

          (g) an involuntary case shall be commenced or an involuntary  petition
shall be filed  seeking  (i)  liquidation,  reorganization  or other  relief  in
respect  of the  Company  or any  Material  Subsidiary  or  its  debts,  or of a
substantial part of its assets, under any Federal,  state or foreign bankruptcy,
insolvency,  receivership  or similar law now or hereafter in effect or (ii) the
appointment  of a receiver,  trustee,  custodian,  sequestrator,  conservator or
similar official for the


                                      -52-
<PAGE>


Company or any Material Subsidiary or for a substantial part of its assets, and,
in any such case, such proceeding or petition shall continue  undismissed for 60
days or an order or decree  approving or ordering any of the foregoing  shall be
entered;

          (h) the Company,  or any  Material  Subsidiary  shall (i)  voluntarily
commence any proceeding or file any petition  seeking  liquidation,  winding-up,
reorganization or other relief under any Federal,  state or foreign  bankruptcy,
insolvency, receivership or similar law now or hereafter in effect, (ii) consent
to the institution  of, or fail to contest in a timely and  appropriate  manner,
any  proceeding  or petition  described in Section  7.01(g),  (iii) apply for or
consent to the  appointment  of a receiver,  trustee,  custodian,  sequestrator,
conservator  or similar  official for the Company or any Material  Subsidiary or
for a substantial part of its assets, (iv) file an answer admitting the material
allegations  of a petition filed against it in any such  proceeding,  (v) make a
general  assignment for the benefit of creditors or (vi) take any action for the
purpose of effecting any of the foregoing;

          (i) the Company or any Material Subsidiary shall become unable,  admit
in writing or fail generally to pay its debts as they become due;

          (j) (i) the General  Partner fails to make (whether as primary obligor
or as  guarantor or other  surety) any payment of  principal  of, or interest or
premium, if any, on any item or items of Indebtedness beyond any period of grace
provided  with  respect  thereto  (not to  exceed 30  days);  provided  that the
aggregate outstanding principal amount of all such Indebtedness as to which such
a  payment  default  shall  occur  and be  continuing  is  equal  to or  exceeds
$25,000,000,  or (ii) the  General  Partner  fails to duly  observe,  perform or
comply  with any  agreement  with any  Person  or any term or  condition  of any
instrument,  if such  failure,  individually  or in the  aggregate,  shall  have
resulted in the  acceleration of the payment of  Indebtedness  with an aggregate
face amount which is equal to or exceeds $25,000,000; provided that this Section
7.01(j) shall not apply to secured  Indebtedness that becomes due as a result of
the  voluntary  sale  or  transfer  of the  property  or  assets  securing  such
Indebtedness so long as such Indebtedness is paid in full when due;

          (k) one or more  judgments  for the  payment of money in an  aggregate
amount in excess of  $75,000,000  shall be  rendered  against the  Company,  any
Subsidiary or any combination thereof and the same shall remain undischarged for
a period of 30 consecutive  days during which execution shall not be effectively
stayed, or any action shall be legally taken by a judgment creditor to attach or
levy upon any  assets of the  Company  or any  Subsidiary  to  enforce  any such
judgment;

          (l) any member of the ERISA Group shall fail to pay when due an amount
which it shall have become  liable to pay under Title IV of ERISA;  or notice of
intent to  terminate a Plan shall be filed under Title IV of ERISA by any member
of the ERISA Group, any plan  administrator or any combination of the foregoing;
or the PBGC shall institute proceedings under Title IV of ERISA to terminate, to
impose  liability  (other  than for  premiums  under  Section  4007 of ERISA) in
respect of, or to cause a trustee to be appointed to  administer  any Plan; or a
condition  shall exist by reason of which the PBGC would be entitled to obtain a
decree  adjudicating  that any Plan must be  terminated;  or there shall occur a
complete  or  partial  withdrawal  from , or a default,  within  the  meaning of
Section 4219(c)(5) of ERISA, with respect


                                      -53-
<PAGE>


to, one or more Multiemployer Plans which could cause one or more members of the
ERISA Group to incur a current payment obligation;  and in each of the foregoing
instances  such condition  could  reasonably be expected to result in a Material
Adverse Effect;

then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing,  the  Administrative  Agent, may, and upon the written
request of the Required Lenders shall, by written notice  (including notice sent
by  telecopy)  to the  Company (a "Notice  of  Default")  take any or all of the
following actions,  without prejudice to the rights of the Administrative Agent,
any  Lender or other  holder of any of the  Obligations  to  enforce  its claims
against the Company  (provided that, if an Event of Default specified in Section
7.01(g) or  Section  7.01(h)  shall  occur  with  respect to the  Company or any
Subsidiary,  the  result of which  would  occur  upon the  giving of a Notice of
Default as  specified in clauses (i) and (ii) below,  shall occur  automatically
without the giving of any Notice of Default):  (i) declare the Total  Commitment
terminated,  whereupon the Commitments of the Lenders shall forthwith  terminate
immediately and any accrued facility fees shall forthwith become due and payable
without any other  notice of any kind;  (ii)  declare the  principal  of and any
accrued  interest in respect of all Loans, and all the other  Obligations  owing
hereunder and under the other Loan  Documents,  to be,  whereupon the same shall
become, forthwith due and payable without presentment,  demand, notice of demand
or of dishonor and nonpayment,  protest,  notice of protest, notice of intent to
accelerate,  declaration  or notice of  acceleration  or any other notice of any
kind,  all of which are hereby  waived by the  Company;  and (iii)  exercise any
rights or remedies under the Loan Documents.

                                 ARTICLE VIII.

                            THE ADMINISTRATIVE AGENT

          SECTION 8.01  Appointment,  Powers and Immunities.  Each Lender hereby
irrevocably appoints and authorizes the Administrative Agent to act as its agent
hereunder  and  under  the  other  Loan   Documents  with  such  powers  as  are
specifically  delegated  to the  Administrative  Agent  by  the  terms  of  this
Agreement and such other Loan Documents,  together with such other powers as are
reasonably  incidental thereto.  The Administrative Agent (which term as used in
this  sentence and in Section 8.05 and the first  sentence of Section 8.06 shall
include  reference to its Affiliates and its  Affiliates'  officers,  directors,
employees, attorneys, accountants, experts and agents): (a) shall have no duties
or responsibilities except those expressly set forth in the Loan Documents,  and
shall not by reason of the Loan  Documents  be a trustee  or  fiduciary  for any
Lender;  (b) makes no  representation or warranty to any Lender and shall not be
responsible  to the Lenders for any  recitals,  statements,  representations  or
warranties contained in this Agreement,  or in any certificate or other document
referred  to or  provided  for  in,  or  received  by any of  them  under,  this
Agreement, or for the value, validity,  effectiveness,  genuineness,  execution,
legality,  enforceability  or  sufficiency  of this  Agreement,  any other  Loan
Document or any other document  referred to or provided for herein or therein or
for  any  failure  by  the  Company  or  any  other   Person   (other  than  the
Administrative  Agent) to perform any of its obligations hereunder or thereunder
or for the  existence  or value of, or the  perfection  or  priority of any Lien
upon,  any  collateral  security  or the  financial  or other  condition  of the
Company, the Subsidiaries or any other obligor or guarantor; (c) except pursuant
to Section 8.07 shall not be required to initiate or conduct any  litigation  or
collection proceedings


                                      -54-
<PAGE>


hereunder;  and (d) shall not be responsible  for any action taken or omitted to
be taken by it hereunder or under any other  document or instrument  referred to
or provided  for herein or in  connection  herewith  including  its own ordinary
negligence, except for its own gross negligence,  willful misconduct or unlawful
conduct. The Administrative Agent may employ agents, accountants,  attorneys and
experts and shall not be  responsible  for the  negligence  or misconduct of any
such agents,  accountants,  attorneys or experts selected by it in good faith or
any action taken or omitted to be taken in good faith by it in  accordance  with
the advice of such agents, accountants, attorneys or experts. The Administrative
Agent may deem and treat the payee  named in any Note as the holder  thereof for
all  purposes  hereof  unless and until a written  notice of the  assignment  or
transfer   thereof   permitted   hereunder   shall  have  been  filed  with  the
Administrative Agent. The Administrative Agent is authorized to release any cash
collateral  that is  permitted  to be  released  pursuant  to the  terms of this
Agreement.

          SECTION 8.02  Reliance by  Administrative  Agent.  The  Administrative
Agent  shall  be  entitled  to rely  upon  any  certification,  notice  or other
communication (including any thereof by telephone,  telex, telecopier,  telegram
or cable)  believed  by it to be genuine  and correct and to have been signed or
sent by or on behalf  of the  proper  Person or  Persons,  and upon  advice  and
statements of legal counsel,  independent accountants and other experts selected
by the Administrative Agent in good faith.

          SECTION 8.03 Defaults;  Events of Default.  The  Administrative  Agent
shall not be deemed to have knowledge of the occurrence of a Default or an Event
of Default  (other than the  non-payment of principal of or interest on Loans or
of fees) unless the  Administrative  Agent has received  notice from a Lender or
the Company  specifying  such  Default or Event of Default and stating that such
notice is a "Notice  of  Default."  In the event that the  Administrative  Agent
receives such a notice of the  occurrence of a Default or Event of Default,  the
Administrative  Agent shall give prompt  notice  thereof to the Lenders.  In the
event of a payment Default or Event of Default,  the Administrative  Agent shall
give each Lender prompt notice of each such payment Default or Event of Default.

          SECTION 8.04 Rights as a Lender.  With respect to its  Commitments and
the Loans  made by it,  Wachovia  (and any  successor  acting as  Administrative
Agent),  in its  capacity as a Lender  hereunder  shall have the same rights and
powers hereunder as any other Lender and may exercise the same as though it were
not acting as the  Administrative  Agent,  and the term  "Lender"  or  "Lenders"
shall, unless the context otherwise indicates,  include the Administrative Agent
in its individual capacity. Wachovia (and any successor acting as Administrative
Agent),  and its  Affiliates  may  (without  having to account  therefor  to any
Lender) accept deposits from, lend money to and generally  engage in any kind of
banking, trust or other business with the Company (and any of its Affiliates) as
if it were not acting as the Administrative  Agent.  Wachovia and its Affiliates
may  accept  fees and other  consideration  from the  Company  for  services  in
connection  with this  Agreement or otherwise  without having to account for the
same to the Lenders.

          SECTION  8.05  INDEMNIFICATION.  THE LENDERS  AGREE TO  INDEMNIFY  THE
ADMINISTRATIVE AGENT, THE CO-SYNDICATION AGENTS AND THE CO-DOCUMENTATION  AGENTS
RATABLY  IN  ACCORDANCE  WITH THEIR  APPLICABLE  PERCENTAGES  FOR THE  INDEMNITY
MATTERS AS


                                      -55-
<PAGE>


DESCRIBED IN SECTION 9.03 TO THE EXTENT NOT  INDEMNIFIED  OR  REIMBURSED  BY THE
COMPANY UNDER SECTION 9.03, BUT WITHOUT  LIMITING THE OBLIGATIONS OF THE COMPANY
UNDER  SAID  SECTION  9.03 AND FOR ANY AND ALL OTHER  LIABILITIES,  OBLIGATIONS,
LOSSES,  DAMAGES,  PENALTIES,  ACTIONS,  JUDGMENTS,  SUITS,  COSTS,  EXPENSES OR
DISBURSEMENTS  OF ANY  KIND AND  NATURE  WHATSOEVER  WHICH  MAY BE  IMPOSED  ON,
INCURRED BY OR ASSERTED AGAINST THE ADMINISTRATIVE  AGENT, EITHER CO-SYNDICATION
AGENT OR EITHER CO-DOCUMENTATION AGENT IN ANY WAY RELATING TO OR ARISING OUT OF:
(A) THIS  AGREEMENT OR ANY OTHER LOAN  DOCUMENT  CONTEMPLATED  BY OR REFERRED TO
HEREIN OR THE TRANSACTIONS CONTEMPLATED HEREBY, BUT EXCLUDING,  UNLESS A DEFAULT
OR AN EVENT OF DEFAULT HAS OCCURRED  AND IS  CONTINUING,  NORMAL  ADMINISTRATIVE
COSTS AND EXPENSES  INCIDENT TO THE  PERFORMANCE OF ITS AGENCY  DUTIES,  IF ANY,
HEREUNDER OR (B) THE ENFORCEMENT OF ANY OF THE TERMS OF THIS AGREEMENT OR OF ANY
OTHER LOAN  DOCUMENT;  WHETHER  OR NOT ANY OF THE  FOREGOING  SPECIFIED  IN THIS
SECTION 8.05 ARISES FROM THE SOLE OR CONCURRENT NEGLIGENCE OF THE ADMINISTRATIVE
AGENT, THE CO-SYNDICATION AGENTS OR THE CO-DOCUMENTATION AGENTS, AS THE CASE MAY
BE;  PROVIDED  THAT NO LENDER  SHALL BE LIABLE FOR ANY OF THE  FOREGOING  TO THE
EXTENT  THEY ARISE FROM THE GROSS  NEGLIGENCE,  WILLFUL  MISCONDUCT  OR UNLAWFUL
CONDUCT  OF THE  ADMINISTRATIVE  AGENT,  EITHER  CO-SYNDICATION  AGENT OR EITHER
CO-DOCUMENTATION AGENT.

          SECTION 8.06  Non-Reliance  on Agents and other  Lenders.  Each Lender
acknowledges and agrees that it has,  independently  and without reliance on the
Administrative Agent, either Co-Syndication Agent, either Co-Documentation Agent
or any other  Lender,  and based on such  documents  and  information  as it has
deemed  appropriate,  made  its  own  credit  analysis  of the  Company  and the
Subsidiaries  and its decision to enter into this  Agreement,  and that it will,
independently  and  without  reliance  upon  the  Administrative  Agent,  either
Co-Syndication Agent, either  Co-Documentation Agent or any Lender, and based on
such  documents  and  information  as it shall  deem  appropriate  at the  time,
continue to make its own analysis and  decisions in taking or not taking  action
under this Agreement.  Neither the Administrative  Agent, either  Co-Syndication
Agent  nor  either  Co-Documentation  Agent  shall be  required  to keep  itself
informed as to the  performance or observance by the Company of this  Agreement,
the other Loan  Documents  or any other  document  referred to or  provided  for
herein or to inspect the properties or books of the Company. Except for notices,
reports and other documents and information  expressly  required to be furnished
to the Lenders by the Administrative Agent hereunder, neither the Administrative
Agent, either Co-Syndication Agent nor either  Co-Documentation Agent shall have
any duty or  responsibility  to  provide  any  Lender  with any  credit or other
information  concerning  the  affairs,  financial  condition  or business of the
Company (or any of its  Affiliates)  which may come into the  possession  of the
Administrative Agent, either Co-Syndication Agent, either Co-Documentation Agent
or any of its respective  Affiliates.  In this regard,  each Lender acknowledges
that Andrews Kurth LLP is acting in this  transaction as special  counsel to the
Administrative Agent only. Each Lender will consult with


                                      -56-
<PAGE>


its own legal counsel to the extent that it deems  necessary in connection  with
this Agreement and other Loan Documents and the matters  contemplated herein and
therein.

          SECTION  8.07  Action by  Administrative  Agent.  Except for action or
other matters  expressly  required of the  Administrative  Agent hereunder,  the
Administrative  Agent  shall in all  cases  be fully  justified  in  failing  or
refusing to act hereunder unless it shall (a) receive written  instructions from
the  Required  Lenders (or all of the Lenders as  expressly  required by Section
9.02)  specifying  the  action  to be  taken,  and  (b)  be  indemnified  to its
satisfaction by the Lenders against any and all liability and expenses which may
be incurred by it by reason of taking or continuing to take any such action. The
instructions  of the  Required  Lenders  (or  all of the  Lenders  as  expressly
required  by  Section  9.02) and any action  taken or  failure  to act  pursuant
thereto by the Administrative Agent shall be binding on all of the Lenders. If a
Default or Event of Default has occurred and is continuing,  the  Administrative
Agent shall take such action with respect to such Default or Event of Default as
shall be directed by the Required  Lenders (or all of the Lenders as required by
Section 9.02) in the written  instructions (with indemnities)  described in this
Section 8.07;  provided that,  unless and until the  Administrative  Agent shall
have received such directions,  the  Administrative  Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such  Default  or Event of Default  as it shall  deem  advisable  in the best
interests of the Lenders. In no event,  however,  shall the Administrative Agent
be  required  to take any  action  which  exposes  the  Administrative  Agent to
personal liability or which is contrary to this Agreement or applicable law.

          SECTION 8.08 Resignation or Removal of Administrative  Agent.  Subject
to the  appointment  and  acceptance  of a  successor  Administrative  Agent  as
provided below, the Administrative Agent may resign at any time by giving notice
thereof to the  Lenders and the  Company,  and the  Administrative  Agent may be
removed at any time with or without cause by the Required Lenders. Upon any such
resignation or removal,  the Required  Lenders shall have the right to appoint a
successor  Administrative  Agent  (so long as no  Default  or  Event of  Default
exists) with the prior written  consent of the Company  (which consent shall not
be unreasonably withheld). If no successor  Administrative Agent shall have been
so appointed by the Required  Lenders and shall have accepted  such  appointment
within  thirty (30) days after the  retiring  Administrative  Agent's  giving of
notice  of  resignation  or  the  Required  Lenders'  removal  of  the  retiring
Administrative  Agent, then the retiring  Administrative Agent may, on behalf of
the Lenders,  appoint a successor Administrative Agent (so long as no Default or
Event of Default  exists) with the prior written  consent of the Company  (which
consent  shall  not be  unreasonably  withheld).  Upon  the  acceptance  of such
appointment  hereunder  by a  successor  Administrative  Agent,  such  successor
Administrative  Agent shall thereupon  succeed to and become vested with all the
rights, powers,  privileges and duties of the retiring Administrative Agent, and
the  retiring  Administrative  Agent  shall be  discharged  from its  duties and
obligations hereunder.  After any retiring Administrative Agent's resignation or
removal hereunder as  Administrative  Agent, the provisions of this Article VIII
and  Section  9.03 shall  continue  in effect for its  benefit in respect of any
actions  taken  or  omitted  to be  taken  by it  while  it  was  acting  as the
Administrative Agent.

          SECTION  8.09  Duties of  Co-Syndication  Agents and  Co-Documentation
Agents.  Notwithstanding  the  indemnity  of the  Co-Syndication  Agents and the
Co-Documentation  Agents contained in Section 8.05 and in Section 9.03,  nothing
contained in this Agreement  shall be construed to impose any obligation or duty
whatsoever on any Person


                                      -57-
<PAGE>


named  on the  cover of this  Agreement  or  elsewhere  in this  Agreement  as a
Co-Syndication Agent,  Co-Documentation Agent, Joint Lead Arranger or Joint Book
Manager, other than those applicable to all Lenders as such.

                                  ARTICLE IX.

                                  MISCELLANEOUS

          SECTION 9.01 Notices, Etc.

          (a) The  Administrative  Agent, any Lender or the holder of any of the
Obligations,  giving  consent  or notice or making any  request  of the  Company
provided  for  hereunder,   shall  notify  each  Lender  (in  the  case  of  the
Administrative  Agent)  and the  Administrative  Agent (in the case of a Lender)
thereof.  In the event  that the  holder  of any Note or any of the  Obligations
(including  any  Lender)  shall  transfer  such  Note or  Obligations,  it shall
promptly  so advise the  Administrative  Agent which shall be entitled to assume
conclusively  that no  transfer of any Note or any of the  Obligations  has been
made by any holder  (including any Lender)  unless and until the  Administrative
Agent receives written notice to the contrary.

          (b) Except with respect to notices and other communications  expressly
permitted to be given by telephone, all notices, consents, requests,  approvals,
demands and other communications  (collectively  "Communications")  provided for
herein  shall be in writing  (including  facsimile  Communications)  and mailed,
telecopied or delivered:

          (i)   if to the Company, to it at:

                     500 Dallas, Suite 1000
                     Houston, Texas 77002
                     Attention:  C. Park Shaper
                     Telecopy No: (713) 369-9499;

          (ii)  if to the Administrative Agent, to it at:

                     c/o Wachovia Capital Markets, LLC
                     1001 Fannin Street, Suite 2255
                     Houston, Texas 77002
                     Attention:  Russell Clingman
                     Telecopy No.: (713)-650-6354;

          (iii) if  to any  other  Lender,  to it at its  address  (or  telecopy
     number) set forth in the  Administrative  Questionnaire  delivered  by such
     Person to the  Administrative  Agent or in the  Assignment  and  Acceptance
     executed by such Person;

or, in the case of any party hereto,  such other  address or telecopy  number as
such  party  may  hereafter  specify  for such  purpose  by  notice to the other
parties.

          (c)  Communications  to the  Lenders  hereunder  may be  delivered  or
furnished by electronic  communications  pursuant to procedures  approved by the
Administrative Agent;


                                      -58-
<PAGE>


provided  that the foregoing  shall not apply to notices  pursuant to Article II
unless otherwise agreed by the  Administrative  Agent and the applicable Lender.
The Administrative Agent or the Company may, in its discretion,  agree to accept
notices and other  communications  to it hereunder by electronic  communications
pursuant to procedures approved by it; provided that approval of such procedures
may be limited to particular notices or communications.

          (d) Any party  hereto may change its  address or  telecopy  number for
notices  and other  communications  hereunder  by  notice  to the other  parties
hereto.  All  notices  and other  communications  given to any  party  hereto in
accordance  with the provisions of this  Agreement  shall be deemed to have been
given on the date of receipt.

          SECTION  9.02  Waivers;  Amendments.  (a) No  failure  or delay by the
Administrative Agent or any Lender in exercising,  and no course of dealing with
respect to, any right or power hereunder shall operate as a waiver thereof,  nor
shall  any  single  or  partial  exercise  of any such  right or  power,  or any
abandonment  or  discontinuance  of steps  to  enforce  such a right  or  power,
preclude  any other or further  exercise  thereof or the  exercise  of any other
right or power.  No notice to or demand on the Company in any case shall entitle
the  Company  to any other or  further  notice or  demand  in  similar  or other
circumstances.  No waiver of any  provision of this  Agreement or consent to any
departure  therefrom  shall in any event be  effective  unless the same shall be
permitted by Section 9.02(b), and then such waiver or consent shall be effective
only in the  specific  instance  and for the  purpose for which  given.  Without
limiting  the  generality  of the  foregoing,  the making of a Loan shall not be
construed as a waiver of any Default or Event of Default,  regardless of whether
the Administrative  Agent or any Lender may have had notice or knowledge of such
Default at the time.

          (b) No provision of this  Agreement or any other Loan  Document may be
waived,  amended or modified  except  pursuant to an agreement or  agreements in
writing  entered into by the Company and the Required  Lenders or by the Company
and the Administrative Agent with the consent of the Required Lenders;  provided
that no such  agreement  shall (i) increase the Commitment of any Lender without
the written consent of such Lender, (ii) reduce the principal amount of any Loan
or reduce the rate of interest thereon,  or reduce any fees payable hereunder or
under the Fee  Letter  without  the  written  consent  of each  Lender  affected
thereby, (iii) postpone the scheduled date of payment of the principal amount of
any Loan (including any payment required  pursuant to Section  2.10(b)),  or any
interest thereon, or any fees payable hereunder,  or reduce the amount of, waive
or excuse any such payment,  or postpone the scheduled date of expiration of any
Commitment,  without the written consent of each Lender affected  thereby,  (iv)
change Section  2.18(b) or (c) in a manner that would alter the pro rata sharing
of payments required thereby, without the written consent of each Lender, or (v)
change  any of the  provisions  of this  Section  9.02(b),  Section  9.05 or the
definition of "Required  Lenders" or any other provision  hereof  specifying the
number or  percentage of Lenders  required to waive,  amend or modify any rights
hereunder or make any determination or grant any consent hereunder,  without the
written  consent of each Lender;  provided  further that no such agreement shall
amend,  modify or  otherwise  affect the rights or duties of the  Administrative
Agent hereunder without the prior written consent of the Administrative Agent.


                                      -59-
<PAGE>


          SECTION  9.03  Payment of  Expenses,  Indemnities,  etc.  The  Company
agrees:

          (a) to pay all reasonable expenses of the Administrative  Agent in the
administration  (including  advice of counsel as to the rights and duties of the
Administrative Agent and the Lenders with respect thereto) of, and in connection
with the negotiation,  syndication,  investigation,  preparation,  execution and
delivery of, recording or filing of,  preservation of rights under,  enforcement
of, and refinancing,  renegotiation or restructuring  of, the Loan Documents and
any  amendment,   waiver  or  consent  relating  thereto   (including,   without
limitation,  travel, photocopy,  mailing,  courier,  telephone and other similar
expenses of the  Administrative  Agent, the reasonable fees and disbursements of
counsel and other outside  consultants for the Administrative  Agent and, in the
case of  enforcement  of  this  Agreement  and the  other  Loan  Documents,  the
reasonable fees and  disbursements of counsel,  including the allocated costs of
inside  counsel for the  Administrative  Agent and each  Lender);  and  promptly
reimburse  the  Administrative  Agent  for all  amounts  expended,  advanced  or
incurred by the Administrative Agent or the Lenders to satisfy any obligation of
the Company under this Agreement.

          (b) TO INDEMNIFY THE ADMINISTRATIVE AGENT, THE CO-SYNDICATION  AGENTS,
THE  CO-DOCUMENTATION  AGENTS AND EACH LENDER AND EACH OF THEIR  AFFILIATES  AND
EACH  OF  THEIR  OFFICERS,  DIRECTORS,   EMPLOYEES,   REPRESENTATIVES,   AGENTS,
ATTORNEYS,  ACCOUNTANTS AND EXPERTS  ("INDEMNIFIED  PARTIES") FROM, HOLD EACH OF
THEM  HARMLESS  AGAINST AND PROMPTLY  UPON DEMAND PAY OR REIMBURSE  EACH OF THEM
FOR,  THE  INDEMNITY  MATTERS  WHICH MAY BE  REASONABLY  INCURRED BY OR ASSERTED
AGAINST OR INVOLVE ANY OF THEM (WHETHER OR NOT ANY OF THEM IS DESIGNATED A PARTY
THERETO) AS A RESULT OF,  ARISING OUT OF OR IN ANY WAY RELATED TO (I) ANY ACTUAL
OR  PROPOSED  USE BY THE COMPANY OF THE  PROCEEDS OF ANY OF THE LOANS,  (II) THE
EXECUTION,  DELIVERY AND PERFORMANCE OF THE LOAN DOCUMENTS, (III) THE OPERATIONS
OF THE  BUSINESS OF THE COMPANY  AND THE  SUBSIDIARIES,  (IV) THE FAILURE OF THE
COMPANY OR ANY  SUBSIDIARY TO COMPLY WITH THE TERMS OF THIS  AGREEMENT,  OR WITH
ANY REQUIREMENT OF LAW, (V) ANY INACCURACY OF ANY  REPRESENTATION  OR ANY BREACH
OF ANY  WARRANTY OF THE COMPANY SET FORTH IN ANY OF THE LOAN  DOCUMENTS  OR (VI)
ANY OTHER  ASPECT  OF THE LOAN  DOCUMENTS,  INCLUDING  THE  REASONABLE  FEES AND
DISBURSEMENTS  OF COUNSEL AND ALL OTHER  EXPENSES  INCURRED IN  CONNECTION  WITH
INVESTIGATING,   DEFENDING  OR  PREPARING  TO  DEFEND  ANY  SUCH  ACTION,  SUIT,
PROCEEDING (INCLUDING ANY INVESTIGATIONS,  LITIGATION OR INQUIRIES) OR CLAIM AND
INCLUDING ALL INDEMNITY MATTERS ARISING BY REASON OF THE ORDINARY  NEGLIGENCE OF
ANY  INDEMNIFIED  PARTY,  BUT EXCLUDING ALL INDEMNITY  MATTERS ARISING SOLELY BY
REASON OF CLAIMS BETWEEN THE LENDERS OR ANY LENDER AND THE ADMINISTRATIVE AGENT,
EITHER  CO-SYNDICATION  AGENT,  OR EITHER  CO-DOCUMENTATION  AGENT OR A LENDER'S
SHAREHOLDERS AGAINST THE ADMINISTRATIVE AGENT OR LENDER OR BY REASON OF THE


                                      -60-
<PAGE>


GROSS  NEGLIGENCE,  WILLFUL  MISCONDUCT OR UNLAWFUL  CONDUCT ON THE PART OF THE
INDEMNIFIED PARTY SEEKING INDEMNIFICATION.

          (c) TO INDEMNIFY AND HOLD  HARMLESS FROM TIME TO TIME THE  INDEMNIFIED
PARTIES  FROM AND AGAINST ANY AND ALL LOSSES,  CLAIMS,  COST  RECOVERY  ACTIONS,
ADMINISTRATIVE ORDERS OR PROCEEDINGS,  DAMAGES AND LIABILITIES TO WHICH ANY SUCH
PERSON MAY BECOME  SUBJECT (I) UNDER ANY  ENVIRONMENTAL  LAW  APPLICABLE  TO THE
COMPANY OR ANY  SUBSIDIARY OR ANY OF THEIR  PROPERTIES OR ASSETS,  INCLUDING THE
TREATMENT  OR DISPOSAL OF  HAZARDOUS  MATERIALS  ON ANY OF THEIR  PROPERTIES  OR
ASSETS,  (II) AS A RESULT OF THE BREACH OR  NON-COMPLIANCE BY THE COMPANY OR ANY
SUBSIDIARY  WITH  ANY  ENVIRONMENTAL  LAW  APPLICABLE  TO  THE  COMPANY  OR  ANY
SUBSIDIARY,  (III) DUE TO PAST OWNERSHIP BY THE COMPANY OR ANY SUBSIDIARY OF ANY
OF THEIR  PROPERTIES  OR ASSETS OR PAST  ACTIVITY ON ANY OF THEIR  PROPERTIES OR
ASSETS WHICH,  THOUGH LAWFUL AND FULLY  PERMISSIBLE AT THE TIME, COULD RESULT IN
PRESENT  LIABILITY,  (IV) THE  PRESENCE,  USE,  RELEASE,  STORAGE,  TREATMENT OR
DISPOSAL OF HAZARDOUS MATERIALS ON OR AT ANY OF THE PROPERTIES OWNED OR OPERATED
BY THE  COMPANY OR ANY  SUBSIDIARY,  OR (V) ANY OTHER  ENVIRONMENTAL,  HEALTH OR
SAFETY CONDITION IN CONNECTION WITH THE LOAN DOCUMENTS.

          (d) No  Indemnified  Party  may  settle  any  claim to be  indemnified
without  the consent of the  indemnitor,  such  consent  not to be  unreasonably
withheld;  provided,  that the indemnitor may not reasonably withhold consent to
any settlement that an Indemnified  Party  proposes,  if the indemnitor does not
have the financial  ability to pay all its obligations  outstanding and asserted
against the  indemnitor  at that time,  including the maximum  potential  claims
against the Indemnified Party to be indemnified pursuant to this Section 9.03.

          (e) In the case of any indemnification  hereunder,  the Administrative
Agent or Lender,  as  appropriate  shall give  notice to the Company of any such
claim or demand being made against the  Indemnified  Party and the Company shall
have the  non-exclusive  right to join in the defense  against any such claim or
demand;  provided that if the Company provides a defense,  the Indemnified Party
shall  bear its own cost of  defense  unless  there is a  conflict  between  the
Company and such Indemnified Party.

          (f) THE FOREGOING  INDEMNITIES SHALL EXTEND TO THE INDEMNIFIED PARTIES
NOTWITHSTANDING  THE SOLE OR  CONCURRENT  NEGLIGENCE  OF EVERY KIND OR CHARACTER
WHATSOEVER,  WHETHER  ACTIVE  OR  PASSIVE,  WHETHER  AN  AFFIRMATIVE  ACT  OR AN
OMISSION,   INCLUDING,   ALL  TYPES  OF  NEGLIGENT  CONDUCT  IDENTIFIED  IN  THE
RESTATEMENT  (SECOND) OF TORTS OF ONE OR MORE OF THE  INDEMNIFIED  PARTIES OR BY
REASON  OF  STRICT  LIABILITY  IMPOSED  WITHOUT  FAULT ON ANY ONE OR MORE OF THE
INDEMNIFIED  PARTIES.  TO THE EXTENT THAT AN INDEMNIFIED  PARTY IS FOUND TO HAVE
COMMITTED  AN ACT OF GROSS  NEGLIGENCE  OR  WILLFUL  MISCONDUCT  OR  ENGAGED  IN
UNLAWFUL


                                      -61-
<PAGE>


CONDUCT, THIS CONTRACTUAL OBLIGATION OF INDEMNIFICATION SHALL CONTINUE BUT SHALL
ONLY  EXTEND TO THE  PORTION  OF THE CLAIM  THAT IS DEEMED TO HAVE  OCCURRED  BY
REASON OF EVENTS OTHER THAN THE GROSS NEGLIGENCE, WILLFUL MISCONDUCT OR UNLAWFUL
CONDUCT OF THE INDEMNIFIED PARTY.

          (g) The  Company's  obligations  under this Section 9.03 shall survive
any  termination  of this  Agreement  and the  payment  of the  Loans  and shall
continue thereafter in full force and effect, for a period of six years.

          (h) To the extent that the Company fails to pay any amount required to
be paid by it to the  Administrative  Agent under this Section 9.03, each Lender
severally  agrees to pay to the  Administrative  Agent such Lender's  Applicable
Percentage  (determined as of the time that the applicable  unreimbursed expense
or  indemnity  payment is  sought)  of such  unpaid  amount;  provided  that the
unreimbursed  expense or indemnified loss, claim,  damage,  liability or related
expense,  as  the  case  may  be,  was  incurred  by  or  asserted  against  the
Administrative Agent in its capacity as such.

          (i) The  Company  shall pay any amounts  due under this  Section  9.03
within  thirty  (30) days of the  receipt by the Company of notice of the amount
due.

          SECTION 9.04 Successors and Assigns.  The provisions of this Agreement
shall be binding  upon and inure to the benefit of the parties  hereto and their
respective  successors and assigns permitted hereby.  Nothing in this Agreement,
expressed or implied,  shall be construed to confer upon any Person  (other than
the parties hereto,  their  respective  successors and assigns  permitted hereby
and, to the extent expressly contemplated hereby, the Related Parties of each of
the Administrative  Agent and the Lenders) any legal or equitable right,  remedy
or claim under or by reason of this Agreement.

          SECTION 9.05 Assignments and Participations.

          (a) The Company may not assign its rights or obligations  hereunder or
under  the  Notes  without  the  prior  consent  of all of the  Lenders  and the
Administrative Agent.

          (b) Any Lender may assign to one or more assignees all or a portion of
its rights and obligations  under this Agreement  (including all or a portion of
its Commitment and the Loans at the time owing to it);  provided that (i) except
in the case of an  assignment  to a Lender or an Affiliate of a Lender,  each of
the Company and the  Administrative  Agent must give their prior written consent
to such  assignment  (which consent shall not be  unreasonably  withheld),  (ii)
except in the case of an  assignment  to a Lender or an Affiliate of a Lender or
an  assignment  of  the  entire  remaining  amount  of  the  assigning  Lender's
Commitment, the amount of the Commitment of the assigning Lender subject to each
such  assignment  (determined as of the date the Assignment and Acceptance  with
respect to such assignment is delivered to the  Administrative  Agent) shall not
be less than $5,000,000 unless each of the Company and the Administrative  Agent
otherwise consent,  (iii) each partial assignment shall be made as an assignment
of a  proportionate  part of all the assigning  Lender's  rights and obligations
under this  Agreement,  (iv) the parties to each  assignment  shall  execute and
deliver to the Administrative


                                      -62-
<PAGE>


Agent an Assignment and  Acceptance,  together with a processing and recordation
fee of $3,500 for each such assignment, and (v) the assignee, if it shall not be
a  Lender,   shall  deliver  to  the  Administrative   Agent  an  Administrative
Questionnaire;  provided  further  that any  consent  of the  Company  otherwise
required under this Section 9.05(b) shall not be required if an Event of Default
has  occurred and is  continuing.  Upon  acceptance  and  recording  pursuant to
Section 9.05(d),  from and after the effective date specified in each Assignment
and  Acceptance,  the  assignee  thereunder  shall be a party hereto and, to the
extent of the interest  assigned by such  Assignment  and  Acceptance,  have the
rights and  obligations  of a Lender  under this  Agreement,  and the  assigning
Lender  thereunder  shall,  to the  extent  of the  interest  assigned  by  such
Assignment and Acceptance, be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance  covering all of the assigning
Lender's rights and obligations under this Agreement, such Lender shall cease to
be a party hereto but shall  continue to be entitled to the benefits of Sections
2.15,  2.16, 2.17 and 9.03). Any assignment or transfer by a Lender of rights or
obligations  under this Agreement that does not comply with this paragraph shall
be  treated  for  purposes  of this  Agreement  as a sale by  such  Lender  of a
participation in such rights and obligations in accordance with Section 9.05(e).

          (c) The Administrative  Agent,  acting for this purpose as an agent of
the Company, shall maintain at one of its offices in Charlotte, North Carolina a
copy of each  Assignment and  Acceptance  delivered to it and a register for the
recordation  of the names and addresses of the Lenders,  and the  Commitment of,
and  principal  amount of the Loans owing to, each Lender  pursuant to the terms
hereof from time to time (the "Register").  The entries in the Register shall be
conclusive, absent manifest error, and the Company, the Administrative Agent and
the  Lenders  may treat each  Person  whose  name is  recorded  in the  Register
pursuant  to the terms  hereof as a Lender  hereunder  for all  purposes of this
Agreement,  notwithstanding  notice  to the  contrary.  The  Register  shall  be
available for inspection by the Company and any Lender,  at any reasonable  time
and from time to time upon reasonable prior notice.

          (d) Upon its receipt of a duly  completed  Assignment  and  Acceptance
executed  by an  assigning  Lender and an  assignee,  the  assignee's  completed
Administrative  Questionnaire  (unless the  assignee  shall  already be a Lender
hereunder),  the processing and  recordation  fee referred to in Section 9.05(b)
and any written  consent to such  assignment  required by Section  9.05(b),  the
Administrative  Agent shall accept such Assignment and Acceptance and record the
information  contained therein in the Register. No assignment shall be effective
for purposes of this  Agreement  unless it has been  recorded in the Register as
provided in this paragraph.

          (e)  Any  Lender  may,  without  the  consent  of the  Company  or the
Administrative Agent, sell participations to one or more banks or other entities
(a  "Participant")  in all or a portion of such Lender's  rights and obligations
under this Agreement (including all or a portion of its Commitment and the Loans
owing to it);  provided that (i) such Lender's  obligations under this Agreement
shall remain unchanged,  (ii) such Lender shall remain solely responsible to the
other  parties  hereto for the  performance  of such  obligations  and (iii) the
Company,  the Administrative  Agent and the other Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement.  Any agreement or instrument pursuant to which
a Lender sells such a participation  shall provide that such Lender shall retain
the sole right to enforce this Agreement and to


                                      -63-
<PAGE>


approve  any  amendment,  modification  or  waiver  of  any  provision  of  this
Agreement;  provided  that such  agreement or  instrument  may provide that such
Lender will not, without the consent of the Participant, agree to any amendment,
modification  or waiver  described in the first proviso to Section  9.02(b) that
affects such  Participant.  Subject to Section 9.05(f),  the Company agrees that
each  Participant  shall be entitled to the benefits of Sections 2.15,  2.16 and
2.17 to the same extent as if it were a Lender and had  acquired its interest by
assignment pursuant to Section 9.05(b), and be indemnified under Section 9.03 as
if it were a Lender. In addition, each agreement creating any participation must
include an agreement by the Participant to be bound by the provisions of Section
9.12.

          (f) A Participant shall not be entitled to receive any greater payment
under Section 2.15 or 2.17 than the  applicable  Lender would have been entitled
to receive with respect to the participation  sold to such  Participant,  unless
the sale of the  participation  to such  Participant  is made with the Company's
prior written consent. A Participant that would be a Foreign Lender if it were a
Lender  shall not be entitled to the benefits of Section 2.17 unless the Company
is notified of the  participation  sold to such Participant and such Participant
agrees, for the benefit of the Company, to comply with Section 2.17(e) as though
it were a Lender.

          (g) The Lenders may furnish any information  concerning the Company in
the  possession of the Lenders from time to time to assignees  and  Participants
(including prospective assignees and participants);  provided that, such Persons
agree to be bound by the provisions of Section 9.12 hereof.

          (h) Notwithstanding anything in this Section 9.05 to the contrary, any
Lender may assign and pledge its Notes to any Federal Reserve Bank or the United
States  Treasury  as  collateral  security  pursuant  to  Regulation  A and  any
operating  circular  issued by such Federal  Reserve  System and/or such Federal
Reserve  Bank.  No such  assignment  and/or  pledge shall  release the assigning
and/or pledging Lender from its obligations hereunder.

          (i)  Notwithstanding  any other  provisions  of this Section  9.05, no
transfer or  assignment  of the  interests or  obligations  of any Lender or any
grant of participations therein shall be permitted if such transfer,  assignment
or grant would require the Company to file a registration statement with the SEC
or to qualify the Loans under the "Blue Sky" laws of any state.

          SECTION 9.06 Survival;  Reinstatement.  (a) All covenants, agreements,
representations   and  warranties   made  by  the  Company  herein  and  in  the
certificates  or other  instruments  delivered in connection with or pursuant to
this Agreement shall be considered to have been relied upon by the other parties
hereto and shall survive the  execution  and delivery of this  Agreement and the
making of any  Loans,  regardless  of any  investigation  made by any such other
party or on its behalf and notwithstanding  that the Administrative Agent or any
Lender may have had notice or  knowledge  of any  Default or Event of Default or
incorrect  representation  or  warranty  at the  time  any  credit  is  extended
hereunder,  and shall continue in full force and effect as long as the principal
of or any accrued  interest on any Loan or any fee or any other  amount  payable
under this Agreement is outstanding and unpaid so long as the  Commitments  have
not expired or terminated.  The provisions of Sections 2.15, 2.16, 2.17 and 9.03
and Article VIII shall survive and remain in full force and effect regardless of
the consummation of


                                      -64-
<PAGE>


the transactions contemplated hereby, the repayment of the Loans, the expiration
or  termination of the  Commitments or the  termination of this Agreement or any
provision hereof.

          (b)  To  the  extent  that  any  payments  on  the   Obligations   are
subsequently invalidated,  declared to be fraudulent or preferential,  set aside
or required to be repaid to a trustee,  debtor in possession,  receiver or other
Person under any bankruptcy  law,  common law or equitable  cause,  then to such
extent,  the  Obligations so satisfied  shall be revived and continue as if such
payment or proceeds had not been received.

          SECTION 9.07 Counterparts;  Integration; Effectiveness. This Agreement
may be executed in  counterparts  (and by different  parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall  constitute a single  contract.  This Agreement,  the other
Loan  Documents  and the Fee Letter  constitute  the entire  contract  among the
parties  hereto  relating to the subject matter hereof and supersede any and all
previous agreements and understandings, oral or written, relating to the subject
matter hereof  (including  the  Information  Memorandum).  Except as provided in
Section 3.01,  this  Agreement  shall become  effective  when it shall have been
executed by the  Administrative  Agent and when the  Administrative  Agent shall
have  received  counterparts  hereof  which,  when  taken  together,   bear  the
signatures of each of the other parties hereto,  and thereafter shall be binding
upon and  inure to the  benefit  of the  parties  hereto  and  their  respective
successors and assigns.  Delivery of an executed counterpart of a signature page
of this  Agreement  by  telecopy  shall be  effective  as delivery of a manually
executed counterpart of this Agreement.

          SECTION 9.08 Severability.  Any provision of this Agreement held to be
invalid,  illegal  or  unenforceable  in  any  jurisdiction  shall,  as to  such
jurisdiction,  be  ineffective to the extent of such  invalidity,  illegality or
unenforceability without affecting the validity,  legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a  particular  jurisdiction  shall not  invalidate  such  provision in any other
jurisdiction.

          SECTION  9.09  Right of  Setoff.  If an Event of  Default  shall  have
occurred and be  continuing,  each Lender is hereby  authorized  at any time and
from time to time, to the fullest extent  permitted by law, to set off and apply
any and all deposits (general or special, time or demand,  provisional or final)
at any time held and other  indebtedness  at any time owing by such Lender to or
for  the  credit  or the  account  of the  Company  against  any of and  all the
Obligations  now or hereafter  existing  under this Agreement and the other Loan
Documents held by such Lender,  irrespective of whether or not such Lender shall
have made any demand under this Agreement and although such  Obligations  may be
unmatured.  The rights of each Lender under this Section 9.09 are in addition to
other rights and remedies  (including  other rights of setoff) which such Lender
may have.

          SECTION  9.10  Governing  Law;  Jurisdiction;  Consent  to  Service of
Process.

          (a) This Agreement and the other Loan Documents  shall be construed in
accordance with and governed by the laws of the State of New York.


                                      -65-
<PAGE>


          (b) ANY LEGAL ACTION OR PROCEEDING  WITH RESPECT TO THIS AGREEMENT AND
THE OTHER LOAN  DOCUMENTS  MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK
SITTING IN THE BOROUGH OF  MANHATTAN  OR OF THE UNITED  STATES FOR THE  SOUTHERN
DISTRICT OF NEW YORK AND, BY EXECUTION AND DELIVERY OF THIS  AGREEMENT,  EACH OF
THE PARTIES HERETO HEREBY  IRREVOCABLY  ACCEPTS FOR ITSELF AND IN RESPECT OF ITS
PROPERTY AND ASSETS,  UNCONDITIONALLY,  THE  NON-EXCLUSIVE  JURISDICTION  OF THE
AFORESAID  COURTS  WITH  RESPECT TO ANY SUCH ACTION OR  PROCEEDING.  THE COMPANY
HEREBY  IRREVOCABLY  DESIGNATES,  APPOINTS AND EMPOWERS CT  CORPORATION  SYSTEM,
INC.,  WITH  OFFICES ON THE DATE  HEREOF AT 111 8TH AVENUE,  NEW YORK,  NEW YORK
10011, AS ITS DESIGNEE, APPOINTEE AND AGENT TO RECEIVE AND ACCEPT FOR AND ON ITS
BEHALF,  AND IN RESPECT OF ITS PROPERTY,  SERVICE OF ANY AND ALL LEGAL  PROCESS,
SUMMONS,  NOTICES  AND  DOCUMENTS  WHICH  MAY BE  SERVED  IN ANY SUCH  ACTION OR
PROCEEDING. IF FOR ANY REASON SUCH DESIGNEE,  APPOINTEE AND AGENT SHALL CEASE TO
BE AVAILABLE  TO ACT AS SUCH,  THE COMPANY  AGREES TO DESIGNATE A NEW  DESIGNEE,
APPOINTEE  AND AGENT IN NEW YORK,  NEW YORK ON THE TERMS AND FOR THE PURPOSES OF
THIS PROVISION  SATISFACTORY TO THE  ADMINISTRATIVE  AGENT.  THE COMPANY FURTHER
IRREVOCABLY  CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED
COURTS IN ANY SUCH  ACTION OR  PROCEEDING  BY THE  MAILING OF COPIES  THEREOF BY
REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID,  TO IT AT ITS ADDRESS PROVIDED IN
SECTION 9.01, SUCH SERVICE TO BECOME  EFFECTIVE  THIRTY DAYS AFTER SUCH MAILING.
NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE ADMINISTRATIVE  AGENT OR ANY LENDER
TO SERVE  PROCESS IN ANY OTHER  MANNER  PERMITTED  BY LAW OR TO  COMMENCE  LEGAL
PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE COMPANY IN ANY OTHER JURISDICTION.

          (c) THE COMPANY HEREBY  IRREVOCABLY  WAIVES ANY OBJECTION WHICH IT MAY
NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID  ACTIONS OR
PROCEEDINGS  ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT  BROUGHT IN THE
COURTS REFERRED TO IN CLAUSE (b) ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES, TO
THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, THE RIGHT TO PLEAD OR CLAIM, AND
AGREES NOT TO PLEAD OR CLAIM, THAT ANY SUCH ACTION OR PROCEEDING  BROUGHT IN ANY
SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

          (d) EACH PARTY HERETO HEREBY (i)  IRREVOCABLY  WAIVES,  TO THE MAXIMUM
EXTENT  PERMITTED  BY LAW, ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY SUCH
LITIGATION ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES, OR DAMAGES
OTHER THAN,  OR IN ADDITION TO, ACTUAL  DAMAGES;  (ii)  CERTIFIES  THAT NO PARTY
HERETO NOR ANY REPRESENTATIVE OR AGENT OR COUNSEL FOR


                                      -66-
<PAGE>


ANY PARTY HERETO HAS REPRESENTED,  EXPRESSLY OR OTHERWISE,  OR IMPLIED THAT SUCH
PARTY  WOULD NOT,  IN THE EVENT OF  LITIGATION,  SEEK TO ENFORCE  THE  FOREGOING
WAIVERS,  AND (iii)  ACKNOWLEDGES  THAT IT HAS BEEN  INDUCED  TO ENTER INTO THIS
AGREEMENT AND THE TRANSACTIONS  CONTEMPLATED  HEREBY AND THEREBY BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS CONTAINED IN THIS SECTION 9.10.

          SECTION 9.11 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY  IN ANY  LEGAL  PROCEEDING  DIRECTLY  OR  INDIRECTLY  ARISING  OUT OF OR
RELATING TO THIS  AGREEMENT OR THE  TRANSACTIONS  CONTEMPLATED  HEREBY  (WHETHER
BASED ON CONTRACT,  TORT OR ANY OTHER  THEORY).  EACH PARTY HERETO (a) CERTIFIES
THAT NO  REPRESENTATIVE,  AGENT OR ATTORNEY OF ANY OTHER PARTY HAS  REPRESENTED,
EXPRESSLY  OR  OTHERWISE,  THAT SUCH  OTHER  PARTY  WOULD  NOT,  IN THE EVENT OF
LITIGATION,  SEEK TO ENFORCE THE FOREGOING WAIVER AND (b)  ACKNOWLEDGES  THAT IT
AND THE OTHER PARTIES  HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.11.

          SECTION 9.12 Confidentiality. Each of the Administrative Agent and the
Lenders agrees to maintain the  confidentiality  of the  Information (as defined
below),  except  that  Information  may be  disclosed  (a)  to  its  Affiliates,
directors,  officers and  employees  and to its agents,  including  accountants,
legal  counsel and other  advisors  who have been  informed of the  confidential
nature  of  the  information  provided,  (b)  to  the  extent  requested  by any
regulatory   authority,   including  the  National   Association   of  Insurance
Commissioners or any similar  organization,  or any nationally recognized rating
agency  that  requires  access  to  information  about  a  Lender's   investment
portfolio,  (c) to the extent a Lender  reasonably  believes  it is  required by
applicable  laws or regulations or by any subpoena or similar legal process (and
such Lender will provide prompt notice thereof to the Company), (d) to any other
party to this  Agreement,  (e) in  connection  with the exercise of any remedies
hereunder or any suit,  action or proceeding  relating to this  Agreement or any
other Loan Document or the  enforcement of rights  hereunder or thereunder,  (f)
subject to an  understanding  with such Person that such Person will comply with
this Section  9.12,  to any assignee of or  Participant  in, or any  prospective
assignee  of or  Participant  in,  any of its rights or  obligations  under this
Agreement,  (g)  with the  consent  of the  Company  or (h) to the  extent  such
Information (i) becomes publicly available other than as a result of a breach of
this Section 9.12 or (ii) becomes available to the  Administrative  Agent or any
Lender  from a source  other than the  Company  (unless  such source is actually
known  by  the   individual   receiving  the   information  to  be  bound  by  a
confidentiality   agreement  or  other  legal  or   contractual   obligation  of
confidentiality  with  respect to such  information).  For the  purposes of this
Section  9.12,  "Information"  means all  information  received from the Company
relating to the Company or its business, other than any such information that is
known to a Lender,  publicly known or otherwise  available to the Administrative
Agent or any Lender other than  through  disclosure  (a) by the Company,  or (b)
from a  source  actually  known to a  Lender  to be  bound by a  confidentiality
agreement  or other legal or  contractual  obligation  of  confidentiality  with
respect

                                      -67-
<PAGE>


to  such   information.   Notwithstanding   anything  herein  to  the  contrary,
"Information"  shall not include,  and the Administrative  Agent and each Lender
may  disclose  to any and all  Persons,  without  limitation  of any  kind,  any
information  with  respect to the U.S.  federal  income tax  treatment  and U.S.
federal  income tax structure of the  transactions  contemplated  hereby and all
materials  of any kind  (including  opinions  or other  tax  analyses)  that are
provided  to the  Administrative  Agent  or such  Lender  relating  to such  tax
treatment and tax structure,  except that the foregoing  proviso shall not apply
to the extent  reasonably  necessary to comply with securities  laws. Any Person
required to maintain  the  confidentiality  of  Information  as provided in this
Section 9.12 shall be considered  to have complied with its  obligation to do so
if such Person maintains the  confidentiality  of such Information in accordance
with  procedures  adopted in good faith to protect  confidential  Information of
third parties delivered to a lender.

          SECTION 9.13 Interest Rate Limitation. Notwithstanding anything herein
to the  contrary,  if at any time the  interest  rate  applicable  to any  Loan,
together with all fees,  charges and other amounts which are treated as interest
on such Loan under applicable law (collectively the "Charges"), shall exceed the
maximum lawful rate (the "Maximum Rate") which may be contracted  for,  charged,
taken,  received or reserved by the Lender holding such Loan in accordance  with
applicable law, the rate of interest  payable in respect of such Loan hereunder,
together with all Charges  payable in respect  thereof,  shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been  payable in  respect  of such Loan but were not  payable as a result of the
operation of this  Section 9.13 shall be cumulated  and the interest and Charges
payable to such Lender in respect of other Loans or periods  shall be  increased
(but not above the Maximum Rate therefor) until such cumulated amount,  together
with  interest  thereon  at the  Federal  Funds  Effective  Rate to the  date of
repayment, shall have been received by such Lender.

          SECTION  9.14  EXCULPATION  PROVISIONS.  EACH  OF THE  PARTIES  HERETO
SPECIFICALLY AGREES THAT IT HAS A DUTY TO READ THIS AGREEMENT, THE NOTES AND (IN
THE CASE OF THE COMPANY AND THE ADMINISTRATIVE  AGENT) THE FEE LETTER AND AGREES
THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS OF THIS  AGREEMENT AND
THE OTHER LOAN  DOCUMENTS;  THAT IT HAS IN FACT READ THIS AGREEMENT AND IS FULLY
INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE TERMS,  CONDITIONS AND EFFECTS
OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS;  THAT IT HAS BEEN REPRESENTED BY
INDEPENDENT  LEGAL COUNSEL OF ITS CHOICE  THROUGHOUT THE NEGOTIATIONS  PRECEDING
ITS EXECUTION OF THIS AGREEMENT AND THE OTHER LOAN  DOCUMENTS;  AND HAS RECEIVED
THE ADVICE OF ITS ATTORNEY IN ENTERING  INTO THIS  AGREEMENT  AND THE OTHER LOAN
DOCUMENTS;  AND THAT IT RECOGNIZES  THAT CERTAIN OF THE TERMS OF THIS  AGREEMENT
AND THE OTHER LOAN DOCUMENTS RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT
IN SOME  ASPECTS  OF THE  TRANSACTION  AND  RELIEVING  THE  OTHER  PARTY  OF ITS
RESPONSIBILITY  FOR SUCH LIABILITY.  EACH PARTY HERETO AGREES AND COVENANTS THAT
IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY  PROVISION
OF THIS AGREEMENT


                                      -68-
<PAGE>


ON THE BASIS THAT THE PARTY HAD NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT
THE PROVISION IS NOT "CONSPICUOUS."


                                      -69-
<PAGE>


      The parties  hereto have caused this  Agreement to be duly  executed as of
the date and year first above written.

                          KINDER MORGAN ENERGY PARTNERS, L.P.,
                          as the Company

                          By: Kinder Morgan G.P., Inc.,
                              its General Partner

                              By: Kinder Morgan Management, LLC,
                                  its Delegate


                               By:    /s/ Joseph Listengart
                                      -------------------------------
                               Name:  Joseph Listengart
                                      -------------------------------
                               Title: Vice President
                                      -------------------------------



<PAGE>


                          LENDERS:

                               WACHOVIA BANK NATIONAL
                               ASSOCIATION, as the Administrative
                               Agent and as a Lender


                               By:    /s/ Russell Clingman
                                      -------------------------------
                                      Russell Clingman
                                      -------------------------------
                                      Director
                                      -------------------------------


<PAGE>


                               JPMORGAN CHASE BANK,
                               as a Co-Syndication Agent and as a Lender


                               By:    /s/ Michael J. DeForge
                                      -------------------------------
                               Name:  Michael J. DeForge
                                      -------------------------------
                               Title: Vice President
                                      -------------------------------




<PAGE>


                               CITIBANK, N.A.,
                               as Co-Syndication Agent and as a Lender


                               By:    /s/ Joronne Jeter
                                      -------------------------------
                               Name:  Joronne Jeter
                                      -------------------------------
                               Title: Attorney-in-Fact
                                      -------------------------------



<PAGE>


                               BANK ONE, N.A.
                               (MAIN OFFICE CHICAGO),
                               as Co-Documentation Agent and as a Lender


                               By:    /s/ Jane Bek-Keil
                                      -------------------------------
                               Name:  Jane Bek-Keil
                                      -------------------------------
                               Title: Director
                                      -------------------------------



<PAGE>


                               BARCLAYS BANK PLC,
                               as Co-Documentation Agent and as a Lender


                               By:    /s/ Nicholas A. Bell
                                      -------------------------------
                               Name:  Nicholas A. Bell
                                      -------------------------------
                               Title: Director
                                      -------------------------------






<PAGE>


                               COMMERZBANK AKTIENGLESEUSCHAFT,
                               ATLANTA AGENCY


                               By:    /s/ Subash R. Viswanathan
                                      -------------------------------
                               Name:  Subash R. Viswanathan
                                      -------------------------------
                               Title: Senior Vice President
                                      -------------------------------


                               By:    /s/ David A. Bennett
                                      -------------------------------
                               Name:  David A. Bennett
                                      -------------------------------
                               Title: Assistant Vice President
                                      -------------------------------





<PAGE>


                               DEUTSCHE BANK AG NEW YORK BRANCH


                               By:    /s/ Richard Henshall
                                      -------------------------------
                               Name:  Richard Henshall
                                      -------------------------------
                               Title: Director
                                      -------------------------------


                               By:    /s/ Joel Makowsky
                                      -------------------------------
                               Name:  Joel Makowsky
                                      -------------------------------
                               Title: Director
                                      -------------------------------





<PAGE>


                               LEHMAN BROTHERS BANK, FSB


                               By:    /s/ Gary T. Taylor
                                      -------------------------------
                               Name:  Gary T. Taylor
                                      -------------------------------
                               Title: Vice President
                                      -------------------------------






<PAGE>


                               WILLIAM STREET COMMITMENT
                               CORPORATION (Recourse only to assets of
                               William Street Commitment Corporation)


                               By:    /s/ Jennifer M. Hill
                                      -------------------------------
                               Name:  Jennifer M. Hill
                                      -------------------------------
                               Title: Vice President and CFO
                                      -------------------------------








<PAGE>


                               KBC BANK N.V.


                               By:    /s/ Robert Snauffer
                                      -------------------------------
                               Name:  Robert Snauffer
                                      -------------------------------
                               Title: First Vice President
                                      -------------------------------


                               By:    /s/ Eric Raskin
                                      -------------------------------
                               Name:  Eric Raskin
                                      -------------------------------
                               Title: Vice President
                                      -------------------------------





<PAGE>


                               ROYAL BANK OF CANADA


                               By:    /s/ Lorne Gartner
                                      -------------------------------
                               Name:  Lorne Gartner
                                      -------------------------------
                               Title: Authorized Signatory
                                      -------------------------------




<PAGE>


                               SUNTRUST BANK, ATLANTA


                               By:    /s/ Joseph M. McCreery
                                      -------------------------------
                               Name:  Joseph M. McCreery
                                      -------------------------------
                               Title: Vice President
                                      -------------------------------




<PAGE>


                               CREDIT LYONNAIS NEW YORK BRANCH


                               By:    /s/ Olivier Audemand
                                      -------------------------------
                               Name:  Olivier Audemand
                                      -------------------------------
                               Title: Senior Vice President
                                      -------------------------------




<PAGE>


                               THE ROYAL BANK OF SCOTLAND plc


                               By:    /s/ Patricia J. Dundee
                                      -------------------------------
                               Name:  Patricia J. Dundee
                                      -------------------------------
                               Title: Senior Vice President
                                      -------------------------------




<PAGE>


                               BMO NESBITT BURNS FINANCING, INC.


                               By:    /s/ Cahal B. Carmody
                                      -------------------------------
                               Name:  Cahal B. Carmody
                                      -------------------------------
                               Title: Vice President
                                      -------------------------------





<PAGE>


                               THE BANK OF NOVA SCOTIA


                               By:    /s/ V. Gibson
                                      -------------------------------
                               Name:  V. Gibson
                                      -------------------------------
                               Title: Assistant Agent
                                      -------------------------------





<PAGE>


                               SOUTHWEST BANK OF TEXAS


                               By:    /s/ Bryan Chapman
                                      -------------------------------
                               Name:  Bryan Chapman
                                      -------------------------------
                               Title: Senior Vice President
                                      -------------------------------





<PAGE>


                               UBS AG, CAYMAN ISLANDS BRANCH


                               By:    /s/ Wilfred V. Saint
                                      -------------------------------
                               Name:  Wilfred V. Saint
                                      -------------------------------
                               Title: Associate Director
                                      Banking Products Services, US
                                      -------------------------------


                               By:    /s/ Juan Zunlga
                                      -------------------------------
                               Name:  Juan Zunlga
                                      -------------------------------
                               Title: Associate Director
                                      Banking Products Services, US
                                      -------------------------------




<PAGE>



                               WELLS FARGO BANK TEXAS, N.A.


                               By:    /s/ Richard A. Gould
                                      -------------------------------
                               Name:  Richard A. Gould
                                      -------------------------------
                               Title: Vice President
                                      -------------------------------





<PAGE>


                               BANK OF TOKYO - MITSUBISHI, LTD.,
                               HOUSTON AGENCY


                               By:    /s/ Donald W. Herrick, Jr.
                                      -------------------------------
                               Name:  Donald W. Herrick, Jr.
                                      -------------------------------
                               Title: Vice President
                                      -------------------------------







<PAGE>


                                                                   SCHEDULE 1.01

                                     COMMITMENTS
                                     -----------



    Wachovia Bank National Association                $ 41,278,182

    JPMorgan Chase Bank                               $ 41,270,000

    Citibank, N.A.                                    $ 41,270,000

    Commerzbank Aktiengleseuschaft, Atlanta Agency    $ 30,000,000

    Deutsche Bank AG New York Branch                  $ 27,000,000

    Lehman Brothers Bank, FSB                         $ 25,000,000

    KBC Bank, N.V.                                    $ 25,000,000

    Royal Bank of Canada                              $ 27,000,000

    SunTrust Bank, Atlanta                            $ 26,000,000

    Bank One, N.A.                                    $ 33,000,000

    Credit Lyonnais New York Branch                   $ 26,000,000

    The Royal Bank of Scotland plc                    $ 27,000,000

    BMO Nesbitt Burns Financing, Inc.                 $ 27,000,000

    Barclays Bank PLC                                 $ 33,000,000

    The Bank of Nova Scotia                           $ 27,000,000

    Southwest Bank of Texas                           $ 13,181,818

    UBS AG, Cayman Islands Branch                     $ 27,000,000

    Wells Fargo Bank Texas, N.A.                      $ 15,000,000

    Bank of Tokyo-Mitsubishi, Ltd., Houston Agency    $ 25,000,000

    William Street Commitment Corporation             $ 33,000,000
                                                      ------------

          TOTAL                                       $570,000,000
                                                      ============






<PAGE>


                                                                  EXHIBIT 1.01-A

                          FORM OF ASSIGNMENT AND ACCEPTANCE
                          ---------------------------------

                             Dated:
                                    ----------------

      Reference is made to the Credit Agreement dated as of October 14, 2003 (as
restated,  amended, modified,  supplemented and in effect from time to time, the
"Credit  Agreement"),  among Kinder  Morgan  Energy  Partners,  L.P., a Delaware
limited partnership (the "Company"),  the Lenders named therein,  Wachovia Bank,
National Association,  as the Administrative Agent (the "Administrative Agent"),
Citibank,  N.A.,  and JPMorgan  Chase Bank,  as the  Co-Syndication  Agents (the
"Co-Syndication  Agents")  and Bank One,  N.A.,  and  Barclays  Bank PLC, as the
Co-Documentation Agents (the "Co-Documentation Agents").  Capitalized terms used
herein and not otherwise  defined shall have the meanings assigned to such terms
in the Credit Agreement.

      This Assignment and  Acceptance,  between the Assignor (as defined and set
forth in Schedule I hereto and made a part  hereof) and the Assignee (as defined
and set forth on  Schedule I hereto  and made a part  hereof) is dated as of the
Effective  Date of Assignment (as set forth on Schedule I hereto and made a part
hereof).

      1. The  Assignor  hereby  irrevocably  sells and  assigns to the  Assignee
without recourse to the Assignor,  and the Assignee hereby irrevocably purchases
and  assumes  from the  Assignor  without  recourse to the  Assignor,  as of the
Effective Date of Assignment, an undivided interest (the "Assigned Interest") in
and to all the  Assignor's  rights and  obligations  under the Credit  Agreement
respecting  those,  and only those,  credit  facilities  contained in the Credit
Agreement as set forth on Schedule I (collectively,  the "Assigned  Facilities",
individually,  an "Assigned Facility"),  in a principal amount for each Assigned
Facility as set forth on Schedule I.

      2. The  Assignor  (i) makes no  representation  or warranty and assumes no
responsibility  with respect to any  statements,  warranties or  representations
made in or in connection with the Credit Agreement or any other Loan Document or
the execution, legality, validity, enforceability,  genuineness,  sufficiency or
value of the Credit  Agreement,  any other Loan Document or any other instrument
or  document  furnished  pursuant  thereto,  other than that it is the legal and
beneficial owner of the Assigned Interest and that the Assigned Interest is free
and clear of any adverse  claim;  (ii) makes no  representation  or warranty and
assumes no responsibility with respect to the financial condition of the Company
or the  Subsidiaries  or the  performance  or  observance  by the Company or the
Subsidiaries of any of its  obligations  under the Credit  Agreement,  any other
Loan Document or any other instrument or document  furnished  pursuant  thereto;
and (iii) attaches the Note if any, held by it evidencing the Assigned  Facility
or Facilities,  as the case may be, and requests that the  Administrative  Agent
exchange  such  Note(s) for a new Note  payable to the Assignor (if the Assignor
has retained any interest in the Assigned Facility or Facilities) and a new Note
payable to the Assignee in the amount which reflects the  assignment  being made
hereby  (and after  giving  effect to any other  assignments  which have  become
effective on the Effective Date of Assignment).

      3. The Assignee (i) represents and warrants that it is legally  authorized
to enter into this Assignment and Acceptance; (ii) confirms that it has received
a copy of the Credit



<PAGE>


Agreement,  together  with  copies of the  financial  statements  referred to in
Section  4.07  thereof,  or if  later,  the  most  recent  financial  statements
delivered  pursuant  to  Section  5.01  thereof,  and such other  documents  and
information as it has deemed appropriate to make its own credit analysis;  (iii)
agrees that it will  independently and without reliance upon the  Administrative
Agent,  the Assignor or any other Lender and based on such other  documents  and
information as it shall deem  appropriate at the time,  continue to make its own
credit decisions in taking or not taking action under the Credit Agreement; (iv)
appoints and  authorizes  the  Administrative  Agent to take such action as such
agent on its behalf and to  exercise  such powers as are  reasonably  incidental
thereto;  (v)  agrees  that it will be bound  by the  provisions  of the  Credit
Agreement  and will  perform in  accordance  with its terms all the  obligations
which by the terms of the Credit Agreement are required to be performed by it as
a Lender;  (vi) confirms that it is an Eligible Assignee;  (vii) if the Assignee
is  organized  under  the laws of a  jurisdiction  outside  the  United  States,
attaches the forms  prescribed  by the Internal  Revenue  Services of the United
States certifying as to the Assignee's  exemption from United States withholding
taxes with respect to all  payments to be made to the Assignee  under the Credit
Agreement  or such other  documents as are  necessary to indicate  that all such
payments  are subject to such tax at a rate by an  applicable  tax  treaty,  and
(viii)  has  supplied   the   information   requested   on  the   administrative
questionnaire provided by the Administrative Agent.

      4. Following the execution of this Assignment and  Acceptance,  it will be
delivered to the  Administrative  Agent for acceptance by it and the Company and
recording  by the  Administrative  Agent  pursuant to Section 9.05 of the Credit
Agreement,  effective as of the Effective  Date of Assignment  (which  Effective
Date of  Assignment  shall,  unless  otherwise  agreed to by the  Administrative
Agent, be at least five Business Days after the execution of this Assignment and
Acceptance).

      5. Upon such  acceptance and recording,  from and after the Effective Date
of Assignment,  the  Administrative  Agent shall make all payments in respect of
the Assigned Interest (including payments of principal, interest, fees and other
amounts)  to the  Assignee,  whether  such  amounts  have  accrued  prior to the
Effective  Date of  Assignment or accrue  subsequent  to the  Effective  Date of
Assignment.  The Assignor and Assignee shall make all appropriate adjustments in
payments  for  periods  prior  to  the  Effective  Date  of  Assignment  by  the
Administrative  Agent or with respect to the making of this assignment  directly
between themselves.

      6. From and after the Effective Date of Assignment, (i) the Assignee shall
be party to the Credit  Agreement and, to the extent provided in this Assignment
and Acceptance, have the rights and obligations of a Lender thereunder, and (ii)
the Assignor  shall,  to the extent  provided in this Assignment and Acceptance,
relinquish  its rights and be  released  from its  obligations  under the Credit
Agreement.

      7. THIS  ASSIGNMENT AND ACCEPTANCE  SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

      IN WITNESS  WHEREOF,  the parties  hereto have caused this  Assignment and
Acceptance  to be  executed  by their  respective  duly  authorized  officers on
Schedule I hereto.


                                      -2-
<PAGE>


                       Schedule I to Assignment and Acceptance

Legal Name of Assignor:
                        -------------------------------------------

Legal Name of Assignee:
                        -------------------------------------------

Effective Date of Assignment:
                              -------------------------------------





                                                Percentage Assigned of Each
                                                  Facility (to at least 8
                                                   decimals) (Shown as a
                            Principal             percentage of aggregate
                            Amount of              held by all applicable
Assigned Facilities     Assigned Interest                 Lenders)
-------------------     -----------------       ----------------------------

Commitment                 $                                      %
                            ----------                   ---------

Committed Loans            $                                      %
                            ----------                   ---------

Competitive Loans          $                                      %
                            ----------                   ---------

           Total           $
                            ----------



                                      -3-
<PAGE>


                                                                  EXHIBIT 1.01-B

                             FORM OF COMMITTED NOTE
                             ----------------------


                                                            -------------, -----

           FOR VALUE RECEIVED,  the undersigned,  KINDER MORGAN ENERGY PARTNERS,
L.P., a Delaware limited partnership, (the "Company"), HEREBY PROMISES TO PAY to
the   order  of   _______________________________________________________   (the
"Lender"),  the lesser of (i) such  Lender's  Commitment  and (ii) the aggregate
amount of  Committed  Loans made by the Lender and  outstanding  on the Maturity
Date.  The  principal  amount of the  Committed  Loans made by the Lender to the
Company  shall  be due  and  payable  on the  dates  and in the  amounts  as are
specified  in that  certain  Credit  Agreement  dated as of October 14, 2003 (as
restated,  amended, modified,  supplemented and in effect from time to time, the
"Credit  Agreement") among the Company,  the Lender,  certain other lenders that
are party thereto, the Co-Syndication  Agents, the  Co-Documentation  Agents and
Wachovia Bank, National Association,  as Administrative Agent for the Lender and
such other lenders.  All capitalized terms used herein and not otherwise defined
shall have the meanings as defined in the Credit Agreement.

           The Company  promises to pay interest on the unpaid  principal amount
of each Committed Loan outstanding from time to time from the date thereof until
such  principal  amount is paid in full, at such  interest  rates and payable on
such dates as are specified in the Credit Agreement. Both principal and interest
are payable in same day funds in lawful money of the United States of America to
the Administrative  Agent at its Principal Office, or at such other place as the
Administrative Agent shall designate in writing to the Company.

           This Note is one of the Committed Notes referred to in, and this Note
and all provisions herein are entitled to the benefits of, the Credit Agreement.
The  Credit  Agreement,  among  other  things  (a)  provides  for the  making of
Committed  Loans by the Lender and the other lenders to the Company from time to
time, and (b) contains  provisions for  acceleration of the maturity hereof upon
the happening of certain stated events,  for prepayments on account of principal
hereof  prior to the  maturity  hereof  upon the  terms and  conditions  therein
specified,  and for  limitations  on the  amount of  interest  paid such that no
provision  of the Credit  Agreement  or this Note shall  require  the payment or
permit the collection of interest in excess of the Maximum Rate.

           This Note may be held by the Lender for the account of its applicable
lending office and may be transferred from one lending office to another lending
office from time to time as the Lender may determine.

           The  Company  and any  and all  endorsers,  guarantors  and  sureties
severally  waive grace,  demand,  presentment  for payment,  notice of dishonor,
default or intent to accelerate,  protest and notice of protest and diligence in
collecting  and  bringing  of suit  against any party  hereto,  and agree to all
renewals,   extensions  or  partial  payments  hereon  and  to  any  release  or
substitution of security  herefor,  in whole or in part, with or without notice,
before or after maturity.


<PAGE>


           This Note shall be  governed by and  construed  under the laws of the
State of New York and the applicable laws of the United States of America.


                               KINDER MORGAN ENERGY PARTNERS, L.P.,
                               as the Company

                               By: Kinder Morgan G.P., Inc.,
                                   its General Partner

                                   By: Kinder Morgan Management, LLC,
                                       its Delegate


                                   By:
                                          -----------------------------
                                   Name:
                                   Title:





<PAGE>


                                                                  EXHIBIT 1.01-C

                            FORM OF COMPETITIVE NOTE
                            ------------------------


                                                            -------------, -----

           FOR VALUE RECEIVED,  the undersigned,  KINDER MORGAN ENERGY PARTNERS,
L.P., a Delaware limited partnership, (the "Company"), HEREBY PROMISES TO PAY to
the order of ________________________________  (the "Lender"), the lesser of (i)
the aggregate  amount of all  Commitments  of all Lenders and (ii) the aggregate
amount  of  Competitive  Loans  made  by  the  Lender  and  outstanding  on  the
Termination  Date.  The principal  amount of the  Competitive  Loans made by the
Lender to the  Company  shall be due and payable on the dates and in the amounts
as are specified in that certain Credit  Agreement  dated as of October 14, 2003
(as restated,  amended, modified,  supplemented and in effect from time to time,
the "Credit  Agreement")  among the Company,  the Lender,  certain other lenders
that are party thereto, the Co-Syndication  Agents, the Co-Documentation  Agents
and Wachovia Bank,  National  Association,  as the Administrative  Agent for the
Lender  and such  other  lenders.  All  capitalized  terms  used  herein and not
otherwise defined shall have the meanings as defined in the Credit Agreement.

           The Company  promises to pay interest on the unpaid  principal amount
of each  Competitive  Loan  outstanding  from time to time from the date thereof
until such principal  amount is paid in full, at such interest rates and payable
on such dates as are  specified  in the Credit  Agreement.  Both  principal  and
interest are payable in same day funds in lawful  money of the United  States of
America to the  Administrative  Agent at the Principal  Office, or at such other
place as the Administrative Agent shall designate in writing to the Company.

           This Note is one of the  Competitive  Notes  referred to in, and this
Note and all  provisions  herein are  entitled  to the  benefits  of, the Credit
Agreement. The Credit Agreement,  among other things (a) provides for the making
of  Competitive  Loans by the Lender and the other  lenders to the Company  from
time to time,  and (b)  contains  provisions  for  acceleration  of the maturity
hereof upon the happening of certain stated events,  for  prepayments on account
of principal  hereof prior to the maturity  hereof upon the terms and conditions
therein specified,  and for limitations on the amount of interest paid such that
no provision of the Credit  Agreement or this Note shall  require the payment or
permit the collection of interest in excess of the Maximum Rate.

           This Note may be held by the Lender for the account of its applicable
lending office and may be transferred from one lending office to another lending
office from time to time as the Lender may determine.

           The  Company  and any  and all  endorsers,  guarantors  and  sureties
severally  waive grace,  demand,  presentment  for payment,  notice of dishonor,
default or intent to accelerate,  protest and notice of protest and diligence in
collecting  and  bringing  of suit  against any party  hereto,  and agree to all
renewals,   extensions  or  partial  payments  hereon  and  to  any  release  or
substitution of security  herefor,  in whole or in part, with or without notice,
before or after maturity.



<PAGE>


           This Note shall be  governed by and  construed  under the laws of the
State of New York and the applicable laws of the United States of America.


                               KINDER MORGAN ENERGY PARTNERS, L.P.,
                               as the Company

                               By: Kinder Morgan G.P., Inc.,
                                   its General Partner

                                   By: Kinder Morgan Management, LLC,
                                       its Delegate


                                   By:
                                          -----------------------------
                                   Name:
                                   Title:




                                      -2-
<PAGE>


                                                                    EXHIBIT 2.03

                              FORM OF BORROWING REQUEST
                              -------------------------

                                Dated
                                      ------------

Wachovia Bank, National Association,
as Administrative Agent
301 South College Street
Charlotte, North Carolina  28288-0608
Attn:  Syndication Agency Services

Ladies and Gentlemen:

      This  Borrowing  Request  is  delivered  to you by  Kinder  Morgan  Energy
Partners,  L.P. (the "Company"),  a Delaware limited partnership,  under Section
2.03 of the  Credit  Agreement  dated as of  October  14,  2003,  (as  restated,
amended,  modified,  supplemented and in effect, the "Credit  Agreement") by and
among  the  Company,   the  Lenders  party  thereto,   Wachovia  Bank,  National
Association,  as Administrative Agent, Citibank,  N.A., and JPMorgan Chase Bank,
as  Co-Syndication  Agents,  and Bank One,  N.A.,  and  Barclays  Bank  PLC,  as
Co-Documentation Agents.

      1. The Company  hereby  requests  that the Lenders make a Loan or Loans in
the aggregate  principal amount of $______________  (the "Committed Loan" or the
"Committed Loans")./1

      2. The Company hereby  requests that the Committed Loan or Committed Loans
be made on the following Business Day: _________________________________./2

      3. The Company hereby  requests that the Committed Loan or Committed Loans
bear interest at the following interest rate, plus the Applicable Margin, as set
forth below:


                                                                 Maturity
                                                                 Date for
                    Principal                     Interest       Interest
                  Component of                     Period         Period
   Type of         Committed         Interest        (if            (if
Committed Loan        Loan             Rate      applicable)    applicable)
--------------        ----             ----      -----------    -----------



      4. The Company  hereby  requests that the funds from the Committed Loan or
Committed Loans be disbursed to the following bank account:
_______________________________.


_____________________

1     Complete with an amount in accordance  with Section 2.11(b) of the Credit
      Agreement.

2     Complete  with a Business Day in accordance  with Section  2.11(b) of the
      Credit Agreement.


<PAGE>


      5. After giving effect to the  requested  Committed  Loan,  the sum of the
Committed Credit Exposures,  plus the aggregate  principal amount of Competitive
Loans outstanding as of the date hereof (including the requested Loans) does not
exceed the maximum amount  permitted to be outstanding  pursuant to the terms of
the Credit Agreement.

      6. All of the  conditions  applicable  to the  Committed  Loans  requested
herein as set forth in the Credit  Agreement  have been satisfied as of the date
hereof and will remain satisfied to the date of such Loans.

      7. All capitalized  undefined terms used herein have the meanings assigned
thereto in the Credit Agreement.

           IN WITNESS  WHEREOF,  the  undersigned  have executed this Borrowing
Request this _____ day of _______________, ______.


                               KINDER MORGAN ENERGY PARTNERS, L.P.,
                               as the Company

                               By: Kinder Morgan G.P., Inc.,
                                   its General Partner

                                   By: Kinder Morgan Management, LLC,
                                       its Delegate


                                   By:
                                          -----------------------------
                                   Name:
                                   Title:




                                      -2-
<PAGE>


                                                                  EXHIBIT 2.04-A

                         FORM OF COMPETITIVE BID REQUEST



Wachovia Bank, National Association,
as Administrative Agent
301 South College Street
Charlotte, North Carolina  28288-0608

Attention: Syndication Agency Services

Ladies and Gentlemen:

           Reference  is made to the Credit  Agreement  dated as of October  14,
2003 (as restated,  amended,  modified,  supplemented and in effect from time to
time, the "Credit Agreement"), among the undersigned, the Lenders party thereto,
the  Co-Syndication  Agents,  the  Co-Documentation  Agents and  Wachovia  Bank,
National Association, as Administrative Agent. Capitalized terms used herein and
not otherwise  defined herein shall have the meanings  assigned to such terms in
the Credit  Agreement.  The  undersigned  hereby  gives you notice  pursuant  to
Section 2.04 of the Credit  Agreement  that it requests a Competitive  Borrowing
under the Credit Agreement, and in that connection sets forth below the terms on
which such Competitive Borrowing is requested to be made:

(A)   Borrowing Date of Competitive
      Borrowing (which is a Business Day)
                                               -------------------------

(B)   Aggregate Principal Amount of
      Competitive Borrowing/1
                                               -------------------------

(C)   Interest rate basis/2

(D)   Interest Period and the last
      day thereof /3
                                               -------------------------

(E)   Location and number of Company's account
      to which funds are to be deposited
                                               -------------------------


_____________________

1     Not less than  $25,000,000 or greater than the unused Total Commitment and
      in integral multiples of $1,000,000.

2     Eurodollar Competitive Borrowing or Fixed Rate Borrowing.

3     Which shall have a duration (i) in the case of a Eurodollar  Loan, of one,
      two,  three or six months and (ii) in the case of Fixed Rate Loan,  of not
      less than seven days nor more than 180 days,  and which,  in either  case,
      shall end not later than the Termination Date.


<PAGE>


           By the delivery of this Competitive Bid Request and the acceptance of
any or all of the  Competitive  Loans offered by the Lenders in response to this
Competitive Bid Request, the undersigned shall be deemed to have represented and
warranted that the applicable  conditions to lending specified in Article III of
the  Credit  Agreement  have been  satisfied  with  respect  to the  Competitive
Borrowing requested hereby.

                               Very truly yours,

                               KINDER MORGAN ENERGY PARTNERS, L.P.,
                               as the Company

                               By: Kinder Morgan G.P., Inc.,
                                   its General Partner

                                   By: Kinder Morgan Management, LLC,
                                       its Delegate


                                   By:
                                          -----------------------------
                                   Name:
                                   Title:





<PAGE>


                                                                  EXHIBIT 2.04-B

                FORM OF NOTICE TO LENDERS OF COMPETITIVE BID REQUEST



[Name of Lender]
[Address of Lender]

                                                                          [Date]

Attention:

Ladies and Gentlemen:

           Reference  is made to the Credit  Agreement  dated as of October  14,
2003 (as restated,  amended,  modified,  supplemented and in effect from time to
time, the "Credit  Agreement"),  among Kinder Morgan Energy Partners,  L.P. (the
"Company"),   the  Lenders  party  thereto,   the  Co-Syndication   Agents,  the
Co-Documentation   Agents,   and  Wachovia  Bank,   National   Association,   as
Administrative  Agent.  Capitalized  terms used herein and not otherwise defined
herein shall have the meanings  assigned to such terms in the Credit  Agreement.
The Company delivered a Competitive Bid Request  requesting a Competitive Bid on
_______________,  pursuant to Section  2.04(a) of the Credit  Agreement,  and in
that  connection you are invited to submit a Competitive  Bid by [Date] / [Time]
../1  Your  Competitive  Bid must  comply  with  Section  2.04(b)  of the  Credit
Agreement and the terms set forth below on which the Competitive Bid Request was
made:

(A) Date of Competitive Borrowing
                                    ------------------------------------

(B) Principal amount of
    Competitive Borrowing
                                    ------------------------------------

(C) Interest rate basis
    (i.e., Eurodollar or Fixed Rate)
                                    ------------------------------------

(D) Interest Period and the last
    day thereof/2
                                    ------------------------------------


____________________

1     The  Competitive Bid must be received by the  Administrative  Agent (i) in
      the case of Eurodollar Loans, not later than 10:00 a.m.  Charlotte,  North
      Carolina,  time,  three  Business  Days  before  the  Borrowing  Date of a
      proposed Competitive Borrowing,  and (ii) in the case of Fixed Rate Loans,
      not  later  than  10:00  a.m.,  Charlotte,  North  Caroline,  time  on the
      Borrowing Date of a proposed Competitive Borrowing.

2     Which may not be a date later than the Termination Date.


<PAGE>


                               Very truly yours,

                               WACHOVIA BANK, NATIONAL ASSOCIATION,
                               as Administrative Agent


                               By:
                                      -------------------------------
                               Name:
                                      -------------------------------
                               Title:
                                      -------------------------------




                                      -2-
<PAGE>

                                                                  EXHIBIT 2.04-C

                               FORM OF COMPETITIVE BID

Wachovia Bank, National Association,
as Administrative Agent
301 South College Street
Charlotte, North Carolina  28228-0608                                     [Date]

Attention:  Syndication Agency Services

Ladies and Gentlemen:

           The  undersigned,  [Name of Lender],  refers to the Credit  Agreement
dated as of October 14, 2003 (as restated,  amended, modified,  supplemented and
in effect from time to time, the "Credit Agreement"), among Kinder Morgan Energy
Partners,  L.P. (the "Company"),  the Lenders party thereto,  the Co-Syndication
Agents, the Co-Documentation Agents and Wachovia Bank, National Association,  as
Administrative  Agent.  Capitalized  terms used herein and not otherwise defined
herein shall have the meanings  assigned to such terms in the Credit  Agreement.
The  undersigned  hereby makes a Competitive  Bid pursuant to Section 2.04(b) of
the Credit  Agreement,  in response to the  Competitive  Bid Request made by the
Company on  _________________,  , and in that  connection  sets forth  below the
terms on which such Competitive Bid is made:

(A) Principal Amount/1
                                          ------------------------------------

(B) Competitive Bid Rate/2
                                          ------------------------------------

(C) Interest Period and
    the last day thereof/3
                                          ------------------------------------

           The undersigned  hereby confirms that it is prepared to extend credit
to the Company upon  acceptance  by the Company of this bid in  accordance  with
Section 2.04(d) of the Credit Agreement.


____________________

1     Not  less  than  $5,000,000  or  greater  than the  requested  Competitive
      Borrowing and in integral  multiples of $1,000,000  above said $5,000,000.
      Multiple bids will be accepted by the Administrative Agent.

2     i.e.  LIBOR Rate + or -  _______%,  in the case of  Eurodollar  Loans,  or
      _____%,  in the case of Fixed  Rate Loan (in each case,  expressed  in the
      form of a decimal to no more than four decimal places).

3     The  Interest  Period  must  be  the  Interest  Period  specified  in the
      Competitive Bid Request.


<PAGE>


                               Very truly yours,

                               [NAME OF LENDER]


                               By:
                                      -------------------------------------
                               Name:
                               Title:





<PAGE>


                                                                    EXHIBIT 2.07

                        FORM OF NOTICE OF ACCOUNT DESIGNATION

                                Dated
                                      ------------

Wachovia Bank, National Association,
as Administrative Agent
301 South College Street
Charlotte, North Carolina  28288-0608
Attn:  Syndication Agency Services

Ladies and Gentlemen:

           This  Notice of Account  Designation  is  delivered  to you by Kinder
Morgan Energy Partners,  L.P. (the "Company"),  a Delaware limited  partnership,
under  Section  2.07 of the Credit  Agreement  dated as of October  14, 2003 (as
restated,  amended, modified,  supplemented and in effect from time to time, the
"Credit  Agreement")  by and among  the  Company,  the  Lenders  party  thereto,
Wachovia Bank, National Association,  as Administrative Agent,  Citibank,  N.A.,
and JPMorgan  Chase Bank, as  Co-Syndication  Agents,  and Bank One,  N.A.,  and
Barclays Bank PLC, as Co-Documentation Agents.

           The  Administrative  Agent is hereby  authorized to disburse all Loan
proceeds into the following account(s):

                          [Insert name of bank/
                          ABA Routing Number/
                          and Account Number]

           IN WITNESS  WHEREOF,  the  undersigned   has executed  this Notice of
Account Designation this _____ day of ___________________, ____.


                               KINDER MORGAN ENERGY PARTNERS, L.P.,
                               as the Company

                               By: Kinder Morgan G.P., Inc.,
                                   its General Partner

                                   By: Kinder Morgan Management, LLC,
                                       its Delegate


                                   By:
                                          -----------------------------
                                   Name:
                                   Title:





<PAGE>


                                                                    EXHIBIT 2.08

                          FORM OF INTEREST ELECTION REQUEST

                               Dated
                                     ------------

Wachovia Bank, National Association,
as Administrative Agent
301 South College Street
Charlotte, North Carolina  28288-0608
Attn:  Syndication Agency Services

Ladies and Gentlemen:

           This  irrevocable   Interest  Election  Request  (the  "Request")  is
delivered to you under Section 2.08 of the Credit  Agreement dated as of October
14, 2003 (as restated,  amended, modified,  supplemented and in effect from time
to time, the "Credit  Agreement"),  by and among Kinder Morgan Energy  Partners,
L.P., a Delaware limited partnership (the "Company"),  the Lenders party thereto
(the "Lenders"),  Wachovia Bank, National Association,  as Administrative Agent,
Citibank, N.A., and JPMorgan Chase Bank, as Co-Syndication Agents, and Bank One,
N.A., and Barclays Bank PLC, as Co-Documentation Agents.

      1.   This Interest Election Request is submitted for the purpose of:

           (a)  [Converting]  [Continuing] a ____________ Committed Loan [into]
                [as] a ____________ Loan./1

           (b)  The aggregate  outstanding  principal  balance of such Committed
                Loan is $______________.

           (c)  The last day of the current  Interest  Period for such Committed
                Loan is _____________./2

           (d)  The principal  amount of such  Committed  Loan to be [converted]
                [continued] is $_____________./3

           (e)  The requested effective date of the [conversion]  [continuation]
                of such Committed Loan is _______________./4


____________________

1     Delete the bracketed  language and insert  "Alternate Base Rate" or "LIBOR
      Rate", as applicable, in each blank.

2     Insert  applicable  date  for  any  Eurodollar  Loan  being  converted  or
      continued.

3     Complete  with an amount  in  compliance  with  Section 2.08 of the Credit
      Agreement.

4     Complete  with a  Business  Day in  compliance  with  Section  2.08 of the
      Credit Agreement..

<PAGE>


           (f)  The requested  Interest  Period  applicable  to the  [converted]
                [continued] Committed Loan is ____________________./5

           2.   No Default or Event of Default exists,  and none will exist upon
the conversion or  continuation  of the Committed Loan requested herein.

           3.   All  capitalized  undefined  terms used herein have the meanings
assigned thereto in the Credit Agreement.

           IN WITNESS  WHEREOF,  the  undersigned  has executed  this  Interest
Election Request this _____ day of ___________________, ____.


                               KINDER MORGAN ENERGY PARTNERS, L.P.,
                               as the Company

                               By: Kinder Morgan G.P., Inc.,
                                   its General Partner

                                   By: Kinder Morgan Management, LLC,
                                       its Delegate


                                   By:
                                          -----------------------------
                                   Name:
                                   Title:




____________________

5     Complete for each Eurodollar Loan in compliance with the definition of the
      term "Interest Period" specified in Section 1.01.

<PAGE>


                                                                    EXHIBIT 2.11

                          FORM OF NOTICE OF PREPAYMENT

Wachovia Bank, National Association,
as Administrative Agent
301 South College Street
Charlotte, North Carolina  28228-0608

Attention:  Syndication Agency Services

Ladies and Gentlemen:

           This  irrevocable  Notice of Prepayment is delivered to you by Kinder
Morgan Energy Partners,  L.P. (the "Company"),  a Delaware limited  partnership,
under  Section  2.11 of the Credit  Agreement  dated as of October  14, 2003 (as
restated,  amended, modified,  supplemented and in effect from time to time, the
"Credit  Agreement"),  by and among the Company,  the Lenders party thereto, the
Co-Syndication Agents, the Co-Documentation  Agents, and Wachovia Bank, National
Association, as the Administrative Agent.

      1. The Company hereby provides notice to the Administrative Agent that the
Company  shall repay the  following  ABR Loans  and/or  Eurodollar  Loans in the
amount of $_____________./1

      2. The Company  shall repay the  above-referenced  Loans on the  following
Business Day: ___________________./2

      3. All capitalized  undefined terms used herein have the meanings assigned
thereto in the Credit Agreement.

      IN WITNESS WHEREOF,  the undersigned have executed this Borrowing Request
this _____ day of _______________, _____.


                               KINDER MORGAN ENERGY PARTNERS, L.P.,
                               as the Company

                               By: Kinder Morgan G.P., Inc.,
                                   its General Partner

                                   By: Kinder Morgan Management, LLC,
                                       its Delegate


                                   By:
                                          -----------------------------
                                   Name:
                                   Title:




____________________

1     Complete  with  an amount in  accordance  with  Section 2.03 of the Credit
      Agreement.

2     Complete  with  a Business  Day in  accordance  with  Section  2.03 of the
      Credit Agreement.


<PAGE>


                                                                    EXHIBIT 5.01

                         FORM OF COMPLIANCE CERTIFICATE

           The    undersigned     hereby    certifies    that    he    is    the
____________________________  of  KINDER  MORGAN  MANAGEMENT,  LLC,  a  Delaware
limited  liability  company,  the delegate of the KINDER  MORGAN  G.P.,  INC., a
Delaware corporation,  general partner of KINDER MORGAN ENERGY PARTNERS, L.P., a
Delaware limited partnership (the "Company"),  and that as such he is authorized
to execute  this  certificate  on behalf of the Company.  With  reference to the
Credit Agreement dated as of October 14, 2003 (as restated,  amended,  modified,
supplemented  and in  effect  from  time to time,  the  "Agreement")  among  the
Company,  the Co-Syndication  Agents, the  Co-Documentation  Agents and Wachovia
Bank,  National  Association,  as  Administrative  Agent,  for the lenders  (the
"Lenders"),  which  are or  become  a  party  thereto,  and  such  Lenders,  the
undersigned  represents  and  warrants as follows  (each  capitalized  term used
herein  having the same meaning given to it in the  Agreement  unless  otherwise
specified);

           (a)  Attached  hereto  are the  detailed  computations  necessary  to
      determine whether the Company is in compliance with Sections 6.06(a), (b),
      (c) and (d) of the Agreement as of the end of the [fiscal  quarter][fiscal
      year] ending ________________.

           (b) There  currently  does not exist any  Default or Event of Default
      under the Agreement.

           EXECUTED AND DELIVERED this _____ day of ________________, ______.


                               KINDER MORGAN ENERGY PARTNERS, L.P.,
                               as the Company

                               By: Kinder Morgan G.P., Inc.,
                                   its General Partner

                                   By: Kinder Morgan Management, LLC,
                                       its Delegate


                                   By:
                                          -----------------------------
                                   Name:
                                   Title: