exhibit10_1.htm


    EXHIBIT 10.1

    


    


    


    


    


    


    


    


    


    PARTNERSHIP
AGREEMENT

    


    OF

    


    TEXAS
OFFSHORE PORT SYSTEM

    


    (a
Delaware general partnership)

    


    (dated
as of August 14, 2008)

     

     

     

     

     

    



    
      
         


      

      
         


        
          

        

      

      
         


      

    


    TABLE
OF CONTENTS

     

    
       

      
        	
                ARTICLE
      I DEFINITIONS 

              	
                1

              


      

    

     

    
      	
               
      

            	
              1.1

            	
              Specific
      Definitions 

            	
              1

            


    

    
      	
               
      

            	
              1.2

            	
              Other
      Terms 

            	
              13

            


    

    
      	
               
      

            	
              1.3

            	
              Construction 

            	
              14

            


    

    
      
         

        
          	
                  ARTICLE
      II ORGANIZATION   

                	
                  14

                


        

      

    

     

    
      	
               
      

            	
              2.1

            	
              Formation 

            	
              14

            


    

    
      	
               
      

            	
              2.2

            	
              Name 

            	
              14

            


    

    
      	
               
      

            	
              2.3

            	
              Principal
      Office in the United States; Other Offices 

            	
              14

            


    

    
      	
               
      

            	
              2.4

            	
              Registered
      Office in the State of Delaware; Registered Agent

            	
              14

            


    

    
      	
               
      

            	
              2.5

            	
              Purpose 

            	
              14

            


    

    
      	
               
      

            	
              2.6

            	
              Foreign
      Qualification 

            	
              15

            


    

    
      	
               
      

            	
              2.7

            	
              Term 

            	
              15

            


    

    
      	
               
      

            	
              2.8

            	
              Mergers
      and Exchanges 

            	
              15

            


    

    
      	
               
      

            	
              2.9

            	
              Business
      Opportunities—No Implied Duties or Obligations 

            	
              15

            


    

    
      
         

        
          	
                  ARTICLE
      III PARTNERSHIP INTERESTS AND TRANSFERS   

                	
                  16

                


        

      

    

     

    
      	
               
      

            	
              3.1

            	
              Initial
      Partners 

            	
              16

            


    

    
      	
               
      

            	
              3.2

            	
              Partnership
      Interests 

            	
              16

            


    

    
      	
               
      

            	
              3.3

            	
              Representations
      and Warranties 

            	
              16

            


    

    
      	
               
      

            	
              3.4

            	Transfers,
      Transfer Restrictions and Changes of Control 	
              17

            


    

    
      	
               
      

            	
              3.5

            	
              Possible
      Additional Restrictions on Transfer 

            	
              27

            


    

    
      	
               
      

            	
              3.6

            	
              Additional
      Partnership Interests 

            	
              27

            


    

    
      	
               
      

            	
              3.7

            	
              Information 

            	
              27

            


    

    
      	
               
      

            	
              3.8

            	
              Liability
      to Third Parties 

            	
              28

            


    

    
      	
               
      

            	
              3.9

            	
              Dissociation 

            	
              29

            


    

    
      	
               
      

            	
              3.10

            	
              Lack
      of Partner Authority 

            	
              29

            


    

    
      	
               
      

            	
              3.11

            	
              Not
      a Security 

            	
              30

            


    

    
      	
               
      

            	
              3.12

            	
              Party
      in Default 

            	
              30

            


    

    
      
         

        
          	
                  ARTICLE
      IV CAPITAL CONTRIBUTIONS  

                	
                  30

                


        

      

    

     

    
      	
               
      

            	
              4.1

            	
              Initial
      Facilities Capital Contributions 

            	
              30

            


    

    
      	
               
      

            	
              4.2

            	
              Subsequent
      Contributions 

            	
              32

            


    

    
      	
               
      

            	
              4.3

            	
              Failure
      to Contribute 

            	
              32

            


    

    
      	
               
      

            	
              4.4

            	
              Return
      of Contributions 

            	
              35

            


    

    
      	
               
      

            	
              4.5

            	
              Capital
      Accounts 

            	
              35

            


    

    
      	
               
      

            	
              4.6

            	
              Partner
      Parent Guarantees 

            	
              37

            


    

     

    
      	
              ARTICLE
      V ALLOCATIONS AND DISTRIBUTIONS   

            	
              37

            


    

     

    
      	
               
      

            	
              5.1

            	
              Allocations
      for Capital Account Purposes 

            	
              37

            


    

     

    
      
        
        

      

      
        i

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              5.2

            	
              Allocations
      for Tax Purposes 

            	
              39

            


    

    
      	
               
      

            	
              5.3

            	
              Requirement
      of Distributions 

            	
              41

            


    

    
      	
               
      

            	
              5.4

            	
              Sharing
      of Distributions 

            	
              41

            


    

    
      	
               
      

            	
              5.5

            	
              Reserves 

            	
              41

            


    

    
      	
               
      

            	
              5.6

            	
              Distribution
      Restrictions 

            	
              41

            


    

     

    
      	
              ARTICLE
      VI MANAGEMENT OF THE PARTNERSHIP    

            	
              42

            


    

     

    
      	
               
      

            	
              6.1

            	
              Management
      by the Partners and Delegation of Authority 

            	
              42

            


    

    
      	
               
      

            	
              6.2

            	
              Committees 

            	
              42

            


    

    
      	
               
      

            	
              6.3

            	
              Authority
      of Partners and Committees 

            	
              43

            


    

    
      	
               
      

            	
              6.4

            	
              Officers 

            	
              45

            


    

    
      	
               
      

            	
              6.5

            	
              Duties
      of Officers 

            	
              45

            


    

    
      	
               
      

            	
              6.6

            	
              No
      Duty to Consult 

            	
              45

            


    

    
      	
               
      

            	
              6.7

            	
              Reimbursement 

            	
              45

            


    

    
      	
               
      

            	
              6.8

            	
              Partners
      and Affiliates Dealing With the Company 

            	
              46

            


    

    
      	
               
      

            	
              6.9

            	
              Insurance 

            	
              46

            


    

     

    
      
        	
                ARTICLE
      VII MEETINGS

              	
                46

              


      
 


    
      	
               
      

            	
              7.1

            	
              Meetings
      of Partners and Committees; Required Interest
Actions 

            	
              46

            


    

    
      	
               
      

            	
              7.2

            	
              Special
      Actions 

            	
              47

            


    

    
      	
               
      

            	
              7.3

            	
              Interested
      Partner Transaction

            	
              49

            


    

    
      	
               
      

            	
              7.4

            	
              Voting
      List 

            	
              49

            


    

    
      	
               
      

            	
              7.5

            	
              Proxies 

            	
              50

            


    

    
      	
               
      

            	
              7.6

            	
              Votes 

            	
              50

            


    

    
      	
               
      

            	
              7.7

            	
              Conduct
      of Meetings 

            	
              50

            


    

    
      	
               
      

            	
              7.8

            	
              Action
      by Written Consent 

            	
              50

            


    

    
      	
               
      

            	
              7.9

            	
              Resolution
      of Management Disputes 

            	
              51

            


    

    
      	
               
      

            	
              7.10

            	
              Records 

            	
              51

            


    

     


      
        	
                ARTICLE
      VIII INDEMNIFICATION  

              	
                52

              


      

    

     

    
      	
               
      

            	
              8.1

            	
              Right
      to Indemnification 

            	
              52

            


    

    
      	
               
      

            	
              8.2

            	
              Indemnification
      of Others 

            	
              52

            


    

    
      	
               
      

            	
              8.3

            	
              Advance
      Payment 

            	
              53

            


    

    
      	
               
      

            	
              8.4

            	
              Appearance
      as a Witness 

            	
              53

            


    

    
      	
               
      

            	
              8.5

            	
              Nonexclusivity
      of Rights 

            	
              53

            


    

    
      	
               
      

            	
              8.6

            	
              Insurance;
      Appointment of Counsel 

            	
              53

            


    

    
      	
               
      

            	
              8.7

            	
              Partner
      Notification 

            	
              53

            


    

    
      	
               
      

            	
              8.8

            	
              Savings
      Clause 

            	
              54

            


    

    
      	
               
      

            	
              8.9

            	
              Scope
      of Indemnity 

            	
              54

            


    

     

    
      	
              ARTICLE
      IX TAXES

            	
              54

            


    

     

    
      	
               
      

            	
              9.1

            	
              Tax
      Returns 

            	
              54

            


    

    
      	
               
      

            	
              9.2

            	
              Tax
      Elections 

            	
              54

            


    

    
      	
               
      

            	
              9.3

            	
              Tax
      Matters Partner 

            	
              54

            


    

     

    
      
        
        

      

      
        ii

        
          

        

      

      
        
        

      

    

     

    
      
        	
                ARTICLE
      X BOOKS, RECORDS, REPORTS, AND BANK ACCOUNTS 

              	
                55

              


      

    

     

    
      	
               
      

            	
              10.1

            	
              Maintenance
      of Books 

            	
              55

            


    

    
      	
               
      

            	
              10.2

            	
              Financial
      Statements 

            	
              55

            


    

    
      	
               
      

            	
              10.3

            	
              Tax
      Statements 

            	
              55

            


    

    
      	
               
      

            	
              10.4

            	
              Accounts 

            	
              55

            


    

     

    
      
        	
                ARTICLE
      XI BANKRUPTCY OF A PARTNER  

              	
                56

              


      

    

     

    
      	
               
      

            	
              11.1

            	
              No
      Dissociation Upon Bankruptcy 

            	
              56

            


    

    
      	
               
      

            	
              11.2

            	
              Bankrupt
      Partners 

            	
              56

            


    

     

    
      
        	
                ARTICLE
      XII DISSOLUTION, LIQUIDATION, AND TERMINATION 

              	
                57

              


      

    

     

    
      	
               
      

            	
              12.1

            	
              Dissolution 

            	
              57

            


    

    
      	
               
      

            	
              12.2

            	
              Liquidation
      and Termination 

            	
              57

            


    

    
      	
               
      

            	
              12.3

            	
              Provision
      for Contingent Claims 

            	
              59

            


    

    
      	
               
      

            	
              12.4

            	
              Deficit
      Capital Accounts 

            	
              59

            


    

     

    
      
        	
                ARTICLE
      XIII AMENDMENT OF THE AGREEMENT 

              	
                60

              


      

    

     

    
      	
               
      

            	
              13.1

            	
              Amendments
      to be Adopted by the Company 

            	
              60

            


    

    
      	
               
      

            	
              13.2

            	
              Amendment
      Procedures 

            	
              60

            


    

     

    
      
        	
                ARTICLE
      XIV PARTNERSHIP INTERESTS  

              	
                61

              


      

    

     

    
      	
               
      

            	
              14.1

            	
              Certificates 

            	
              61

            


    

    
      	
               
      

            	
              14.2

            	
              Registered
      Holders 

            	
              61

            


    

     

    
      
        	
                ARTICLE
      XV OTHER PARTNER AGREEMENTS AND OBLIGATIONS  

              	
                61

              


      

    

     

    
      	
               
      

            	
              15.1

            	
              Facilities
      Other than Initial Facilities 

            	
              61

            


    

    
      	
               
      

            	
              15.2

            	
              Project
      Financings 

            	
              62

            


    

    
      	
               
      

            	
              15.3

            	
              Expansion
      Option

            	
              62

            


    

    
      	
               
      

            	
              15.4

            	
              Termination
      of Throughput Agreement

            	
              64

            


    

     

    
      
        	
                ARTICLE
      XVI GENERAL PROVISIONS  

              	
                65

              


      

    

     

    
      	
               
      

            	
              16.1

            	
              Offset

            	
              65

            


    

    
      	
               
      

            	
              16.2

            	
              Entire
      Agreement; Supersedure

            	
              65

            


    

    
      	
               
      

            	
              16.3

            	
              Waivers

            	
              65

            


    

    
      	
               
      

            	
              16.4

            	
              Binding
      Effect

            	
              65

            


    

    
      	
               
      

            	
              16.5

            	
              Governing
      Law; Jurisdiction; Waiver of Jury Trials; Severability

            	
              65

            


    

    
      	
               
      

            	
              16.6

            	
              Further
      Assurances

            	
              66

            


    

    
      	
               
      

            	
              16.7

            	
              Waiver
      of Certain Rights

            	
              66

            


    

    
      	
               
      

            	
              16.8

            	
              Notice
      to Parties of Provisions of this Agreement. 

            	
              66

            


    

    
      	
               
      

            	
              16.9

            	
              Counterparts

            	
              66

            


    

    
      
        	
                 
      

              	
                16.10

              	
                Attendance
      via Communications Equipment

              	
                66

              


      

    

     

    
      
        
        

      

      
        iii

        
          

        

      

      
        
        

      

    

     

    
      
        	
                 
      

              	
                16.11

              	
                
                  Reports
      to Partners

                

              	
                67

              


      

      
        	
                 
      

              	
                16.12

              	
                
                  Checks,
      Notes and Contracts

                

              	
                67

              


      

      
        	
                 
      

              	
                16.13

              	
                
                  Books
      and Records

                

              	
                67

              


      

      
        	
                 
      

              	
                16.14

              	
                
                  Audit
      Rights of Partners 

                

              	
                67

              


      

      
        	
                 
      

              	
                16.15

              	
                
                  No
      Third Party Beneficiaries 

                

              	
                67

              


      

      
        	
                 
      

              	
                16.16

              	
                
                  Notices
      

                

              	
                68

              


      

      
        	
                 
      

              	
                16.17

              	
                
                  Remedies
      

                

              	
                68

              


      

      
        	
                 
      

              	
                16.18

              	
                
                  Grant
      of Security Interest 

                

              	
                68

              


      

      
        	
                 
      

              	
                16.19

              	
                
                  Default
      Budgets 

                

              	
                69

              


      

      
         

      

    

     

    EXHIBITS:

     

    Exhibit A
– Ownership Information

    Exhibit B
– Transfer Notice Form

    Exhibit C
– Partner Parent Guarantees

    


    SCHEDULES:

    Schedule
1 – Description of Initial Facilities

    Schedule
2 – Insurance

    Schedule
3 – Construction Budget


    
      
         


      

      
        iv

        
          

        

      

      
         


      

    

     

    
      PARTNERSHIP
AGREEMENT

      OF

      TEXAS
OFFSHORE PORT SYSTEM

      (a
Delaware general partnership)

       

      This
Partnership Agreement of Texas Offshore Port System, a Delaware general
partnership (the “Company”), dated as
of August 14, 2008 (the “Effective Date”) is
agreed to, executed and adopted by all the Partners (as such term is defined
herein) thereof.

       

      RECITALS

       

      WHEREAS,
the Partners desire to form the Company in connection with the construction,
acquisition, ownership and operation of TOPS (as such term is defined
herein).

       

      AGREEMENT

       

      NOW,
THEREFORE, for and in consideration of the premises and the mutual covenants and
agreements contained herein and other good and valuable consideration (the
receipt and sufficiency of which are hereby confirmed and acknowledged), the
Parties hereto hereby stipulate and agree as follows:

       

      ARTICLE
I

      DEFINITIONS

       

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

         

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

         

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

         

        “Act” means the
Delaware Revised Uniform Partnership Act.

         

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


         

        
          
            
            

          

          
            1

            
              

            

          

          
            
            

          

        

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

        “Bankrupt Partner”
means any Party:

         

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

         

        
          
            
            

          

          
            2

            
              

            

          

          
            
            

          

        

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

          
            3

            
              

            

          

          
            
            

          

        

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

        “Construction Manager”
means Enterprise Field Services, LLC.

         

        
          
            
            

          

          
            4

            
              

            

          

          
            
            

          

        

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

          
            5

            
              

            

          

          
            
            

          

        

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

          
            6

            
              

            

          

          
            
            

          

        

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

          
            7

            
              

            

          

          
            
            

          

        

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

          
            8

            
              

            

          

          
            
            

          

        

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

          
            9

            
              

            

          

          
            
            

          

        

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

        “Operator” means
Enterprise Field Services, LLC.

         

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

         

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

         

        
          
            
            

          

          
            10

            
              

            

          

          
            
            

          

        

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

          
            11

            
              

            

          

          
            
            

          

        

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

          
            12

            
              

            

          

          
            
            

          

        

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

          
            13

            
              

            

          

          
            
            

          

        

         

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

         

        ARTICLE
II

        ORGANIZATION

         

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

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

         

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

         

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

         

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

         

        2.9    Business Opportunities—No
Implied Duties or Obligations.

         

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

         

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

         

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

         

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

         

        
          
            
            

          

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

         

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

         

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

         

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

         

        ARTICLE
III

        PARTNERSHIP
INTERESTS AND TRANSFERS

         

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

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

         

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

         

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

         

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

         

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

         

        (a)    Effects of Attempted or
Permitted Transfers.

         

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

         

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

         

        
          
            
            

          

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

         

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

         

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

         

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

         

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

         

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

         

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

         

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


         

        
          
            
            

          

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

         

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

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

         

        (e)    Right of First
Refusal.

         

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

         

        
          
            
            

          

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

         

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

         

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

         

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

         

        
          
            
            

          

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

         

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

         

        
          
            
            

          

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

         

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

         

        (vii)    Any
Transferring Party may withdraw its offer altogether (including to the original
offeror) if the Appraised Value is less than 90% of the Fair Market Value stated
in the Offer Notice, provided that in such case the Transferring Party will be
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        Appraiser.  Absent
fraud or manifest error, the Appraised Value determination will be final and
binding and not subject to further appeal.

         

        (f)    Right of Purchase Upon
Change of Control.

         

        (i)    Right of
Purchase.

         

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

         

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

         

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

         

        
          
            
            

          

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

         

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

         

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

         

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


         

        
          
            
            

          

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

         

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

         

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

         

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


         

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

         

        
          
            
            

          

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

         

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

         

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

         

        3.7    Information.

         

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

         

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

         

        
          
            
            

          

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

         

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

         

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

         

        
          
            
            

          

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

         

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

         

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

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

         

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

         

        ARTICLE
IV

        CAPITAL
CONTRIBUTIONS

         

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

         

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

         

        
          	
                  ·  

                	
                  For
      the account of Oiltanking, one United States Dollar
    ($1.00);

                


        

        
          	
                  ·  

                	
                  For
      the account of TEPPCO, one United States Dollar ($1.00);
    and

                


        

        
          	
                  ·  

                	
                  For
      the account of Enterprise, one United States Dollar
    ($1.00).

                


        

         

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

         

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

         

        
          
            
            

          

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

         

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

         

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

         

        (f)    Resolution of Capital Call
Disputes.

         

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

         

        
          
            
            

          

          
            31

            
              

            

          

          
            
            

          

        

         

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

         

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

         

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

         

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

         

        4.3    Failure to
Contribute.

         

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

         

        
          
            
            

          

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

         

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

          
            34

            
              

            

          

          
            
            

          

        

         

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

         

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

         

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

          
            35

            
              

            

          

          
            
            

          

        

         

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

         

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

         

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

         

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

         

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

         

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

         

        
          
            
            

          

          
            36

            
              

            

          

          
            
            

          

        

         

        (d)    Adjustments to Capital
Accounts.

         

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

         

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

         

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

         

        4.6    Partner Parent
Guarantees

         

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

         

        ARTICLE
V

        ALLOCATIONS
AND DISTRIBUTIONS

         

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

         

        
          
            
            

          

          
            37

            
              

            

          

          
            
            

          

        

         

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

         

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

         

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

         

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

         

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

         

        (f)    Qualified Income
Offset.  In the event any Party unexpectedly receives any
adjustments, allocations or distributions described in Treasury Regulation
section 1.704-1(b)(2)(ii)(d)(4) through (6) (or any successor provisions), items
of Company income and gain will be specifically allocated to such Party in an
amount and manner sufficient to eliminate, to the extent required by the
Treasury Regulations promulgated under section 704(b) of the Code, the deficit
balance, if any, in its Adjusted Capital 

         

        
          
            
            

          

          
            38

            
              

            

          

          
            
            

          

        

         

        Account
created by such adjustments, allocations or distributions as quickly as possible
unless such deficit balance is otherwise eliminated pursuant to Section 5.1(d) or 5.1(e).

         

        (g)    Gross Income
Allocations.  In the event any Party has a deficit balance in
its Adjusted Capital Account at the end of such taxable period which is in
excess of the sum of (i) the amount such Party is obligated to restore pursuant
to any provision of this Agreement and (ii) the amount such Party is deemed
obligated to restore pursuant to the penultimate sentences of Treasury
Regulations sections 1.704-2(g)(1) and 1.704-2(i)(5), such Party will be
specifically allocated items of Company gross income and gain in the amount of
such excess as quickly as possible; provided that an
allocation pursuant to this Section 5.1(g) will be made
only if and to the extent that such Party would have a deficit balance in its
Adjusted Capital Account after all other allocations provided in this Section 5.1 have been
tentatively made for such taxable period as if this Section 5.1(g) was not in the
Agreement.

         

        (h)    Nonrecourse
Deductions.  Nonrecourse Deductions for any such taxable period
will be allocated to the Parties in proportion to their respective Partnership
Interests.  If a Majority Interest determines in the Eligible
Partners’ good faith discretion that the Company’s Nonrecourse Deductions must
be allocated in a different ratio to satisfy the safe harbor requirements of the
Treasury Regulations promulgated under section 704(b) of the Code, the Company
is authorized, upon notice to the Parties, to revise the prescribed ratio to the
numerically closest ratio which does satisfy such requirements.

         

        (i)    Partner Nonrecourse
Deductions.  Partner Nonrecourse Deductions for any taxable
period will be allocated 100% to the Party that bears the Economic Risk of Loss
for such Partner Nonrecourse Debt to which such Partner Nonrecourse Deductions
are attributable in accordance with Treasury Regulation section 1.704-2(i) (or
any successor provision).  If more than one Party bears the Economic
Risk of Loss with respect to a Partner Nonrecourse Debt, such Partner
Nonrecourse Deductions attributable thereto will be allocated between or among
such Parties ratably in proportion to their respective shares of such Economic
Risk of Loss.

         

        (j)    Code Section 754
Adjustments.  To the extent an adjustment to the adjusted tax
basis of any Company asset pursuant to section 734(b) or 743(b) of the Code is
required to be taken into account in determining Capital Accounts pursuant to
Treasury Regulation section 1.704-1(b)(2)(iv)(m), the amount of such adjustment
in the Capital Accounts shall be treated as an item of gain (if the adjustment
increases the basis of such asset) or loss (if the adjustment decreases such
basis), and such item of gain or loss shall be specially allocated to the
Parties in the manner in which their Capital Accounts are required to be
adjusted pursuant to such section of the Treasury Regulations.

         

        5.2    Allocations for Tax
Purposes.

         

        (a)    Except as
otherwise provided herein, for federal income tax purposes, each item of income,
gain, loss and deduction which is recognized by the Company for federal income
tax purposes will be allocated among the Parties in the same manner as its


         

        
          
            
            

          

          
            39

            
              

            

          

          
            
            

          

        

         

        correlative
item of “book” income, gain, loss or deduction is allocated pursuant to Section 5.1.

         

        (b)    In an
attempt to eliminate Book-Tax Disparities attributable to a Contributed Property
or Adjusted Property, items of income, gain, loss, depreciation, amortization
and cost recovery deductions will be allocated for federal income tax purposes
among the Parties as follows:

         

        (i)    (A)    In the case
of a Contributed Property, such items attributable thereto will be allocated
among the Parties in the manner provided under section 704(c) of the Code and
section 1.704-3(d) of the Treasury Regulations (i.e. the “remedial method”) that
takes into account the variation between the Agreed Value of such property and
its adjusted basis at the time of contribution; and (B) any item of Residual
Gain or Residual Loss attributable to a Contributed Property will be allocated
among the Parties in the same manner as its correlative item of “book” gain or
loss is allocated pursuant to Section 5.1.

         

        (ii)    (A)    In the case
of an Adjusted Property, such items will (1) first, be allocated among the
Parties in a manner consistent with the principles of section 704(c) of the Code
and section 1.704-3(d) of the Treasury Regulations (i.e. the “remedial method”)
to take into account the Unrealized Gain or Unrealized Loss attributable to such
property and the allocations thereof pursuant to Section 4.5(d)(i) or (ii) and (2) second,
in the event such property was originally a Contributed Property, be allocated
among the Parties in a manner consistent with Section 5.2(b)(i)(A); and (B)
any item of Residual Gain or Residual Loss attributable to an Adjusted Property
will be allocated among the Parties in the same manner as its correlative item
of “book” gain or loss is allocated pursuant to Section 5.1.

         

        (c)    For the
proper administration of the Company, the Company will (i) adopt such
conventions as it deems appropriate in determining the amount of depreciation,
amortization and cost recovery deductions; provided, that such
depreciation, amortization and cost recovery methods will be the most
accelerated methods allowed under federal tax laws; (ii) make special
allocations for federal income tax purposes of income (including gross income)
or deductions; and (iii) amend the provisions of this Agreement as appropriate
to reflect the proposal or promulgation of Treasury Regulations under section
704(b) or section 704(c) of the Code.  The Company may adopt such
conventions, make such allocations and make such amendments to this Agreement as
provided in this Section 5.2(c) only if such
conventions, allocations or amendments are consistent with the principles of
section 704 of the Code.

         

        (d)    The
Company may determine to depreciate the portion of an adjustment under section
743(b) of the Code attributable to unrealized appreciation in any Adjusted
Property (to the extent of the unamortized Book-Tax Disparity) using a
predetermined rate derived from the depreciation method and useful life applied
to the Company’s common basis of such property, despite the inconsistency of
such with Treasury Regulation section 1.167(c)-1(a)(6), or any successor
provisions.  If the Company 

         

        
          
            
            

          

          
            40

            
              

            

          

          
            
            

          

        

         

        determines
that such reporting position cannot reasonably be taken, the Company may adopt
any reasonable depreciation convention that would not have a material adverse
effect on the Partners.

         

        (e)    Any gain
allocated to the Parties upon the sale or other taxable disposition of any
Company asset will, to the extent possible, after taking into account other
required allocations of gain pursuant to this Section 5.2 be
characterized as Recapture Income in the same proportions and the same extent as
such Parties (or their predecessors in interest) have been allocated any
deductions directly or indirectly giving rise to the treatment of such gains as
Recapture Income.

         

        (f)    All items
of income, gain, loss, deduction and credit recognized by the Company for
federal income tax purposes and allocated to the Parties in accordance with the
provisions hereof will be determined without regard to any election under
section 754 of the Code which may be made by the Company; provided, however, that such
allocations, once made, will be adjusted as necessary or appropriate to take
into account those adjustments permitted or required by sections 734 and 743 of
the Code.

         

        5.3    Requirement of
Distributions. Subject
to the provisions of Sections 5.6 and 12.2, the Company
will distribute (within 30 Days following the end of each calendar month) its
Available Cash to the Parties who were Record Holders as of the Record Date for
such distribution, as provided in Section 5.4.

         

        5.4    Sharing of
Distributions. Except
for preferential or disproportionate distributions to the extent expressly
provided for in this Agreement (including those set forth in Sections 4.1(f)(ii) and
12.2),
all distributions attributable to the Partnership Interests of the Company paid
in cash, property, or equity ownership of the Company will be allocated and made
to the Parties in proportion to their respective Partnership
Interests.

         

        5.5    Reserves. Before
payment of any distributions, there may be set aside out of any Available Cash
such sum or sums as a Unanimous Interest from time to time determines proper as
a cash reserve or reserves to meet working capital, other obligations and
contingencies, for repairing or maintaining any property of the Company, or for
such other purpose as a Required Interest determines to be appropriate, except
that no reserves shall be provided or be retained for any cost of the Company
that will be capitalized; and a Required Interest may modify or abolish any such
cash reserve in the manner in which it was created.

         

        5.6    Distribution
Restrictions. Unless
consented to in writing by a Unanimous Interest, and subject to the provisions
of Section
4.3, the
Company will not distribute any of the Initial Facilities Capital Contributions
until the completion of the construction and installation of the Initial
Facilities, except to the extent that a Unanimous Interest agrees that the
applicable portion of such Initial Facilities Capital Contributions is no longer
needed to finance such construction and installation or the operations of the
Company.

         

        
          
            
            

          

          
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        ARTICLE
VI

        MANAGEMENT
OF THE PARTNERSHIP

         

        6.1    Management by the Partners
and Delegation of Authority. The
business and affairs of the Company will be managed by or under the authority of
the Partners in accordance with the Act, which Partners may act through their
designated representatives.  Except for situations in which the
approval of the Partners is required by this Agreement or by non-waivable
provisions of applicable Laws, a Required Interest will have broad discretion
to, and may, authorize any committee constituted pursuant to Section 6.2 or
any officer or other agent (including the Operator and the Construction Manager)
to act on behalf of the Company or to make any determination on behalf of the
Company.  At a meeting of the Partners at which a quorum is present
(in person or by proxy), the affirmative vote of a Majority Interest will be the
act of the Partners or any committee unless a different Required Interest is
required by a non-waivable provision of the Act or any express provision of this
Agreement.  Where the Required Interest for a particular action,
determination or other matter with respect to the Company, the Partners or any
committee formed hereunder is not expressly specified herein, a Majority
Interest shall be the Required Interest with respect to such action,
determination or other matter. 

         

        6.2    Committees.

         

        (a)    For
organizational purposes, the Partners shall form a management committee of the
Partners (the “Management
Committee”) responsible for the planning, oversight and approval of the
policies and strategies of the Company and any other actions not expressly
delegated to another committee, body, officer or other representative of the
Company (including Construction Manager or Operator) or otherwise retained or
reserved for the Partners under this Agreement.  At any time after the
date hereof, the Partners may form one or more other committees of the Partners
to be responsible for planning, oversight, control and approval over such
matters as delegated to such committee by the Partners.  Each Partner
is entitled to representation on every committee established hereunder in
proportion to its respective Partnership Interest and each Partner will appoint
in writing one (or more) of its duly authorized agents to act for the Partner on
each committee of the Partners.  One such agent(s) of each Partner
will be given the authority by such Partner to vote on behalf of the Partner on
any issue within the committee’s responsibility.  The collective
representatives of each Partner on a committee will be entitled to one vote (or
a fraction thereof) per percent (or fraction thereof) of Partnership Interest
held by such Partner, as reflected in the transfer records of the
Company.  Any person may serve as a representative for more than one
Partner.

         

        (b)    Each
Partner is entitled to appoint the Chairman of the Management Committee in
alternating years; provided
such Partner holds at least a twenty percent (20%) Partnership
Interest.  During the first one-year period of this Agreement,
Oiltanking shall select the Chairman, during the second one-year period, TEPPCO
shall select the Chairman, and during the third one-year period Enterprise shall
select the Chairman.  For the purposes of this paragraph, each Partner
and its Affiliates who are Partners shall be treated as a single Partner; provided, however, that
Enterprise and TEPPCO shall not be treated as Affiliates for the purposed of
this Section 6.2(b).

         

        
          
            
            

          

          
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        (c)    Each
Partner will appoint at least one Vice President or a more senior officer of the
Partner or its Affiliates and one alternate to serve on the Management
Committee.  Each Partner will, absent extenuating circumstances, use
commercially reasonable efforts to have such senior representative serve on the
Management Committee for at least two consecutive years.

         

        6.3    Authority of Partners and
Committees.

         

        (a)    With
respect to conflicts or disagreements between and among any committees, the
Management Committee will have ultimate decision-making
authority.  The Partners and the committees will act through the
Company’s officers, employees, representatives, agents and designees to whom
authority has been expressly delegated.  No Partner will have
individual authority to bind the Company unless such is expressly delegated in
writing, conferred upon it pursuant to this Agreement or by action of the
Company or a duly authorized committee, body, officer or other
representative.  All actions required by this Agreement to be taken or
approved by the Partners will be pursuant to resolutions approved or consented
to by the Partners in accordance with Article VII
(including the majority and unanimous approval requirements set forth in Sections 6.1 and 7.2).

         

        (b)    Unless
otherwise expressly delegated in writing or provided by this Agreement and
subject to Section
7.2, the Partners hereby delegate to the Management Committee as a group
the authority, with respect to the Company, to authorize and approve the
following, or, with respect to matters to be authorized or approved by
Subsidiaries of the Company, to determine how the Company will vote as a member
of such Subsidiary, with respect to the following:

         

        (i)    authorizing
any Throughput Agreement;

         

        (ii)    (A)    entering into
any credit agreement, indenture or similar agreement, (B) entering into any
employment agreement, consulting agreement or other services agreement with
Affiliates or employees of Affiliates of any of the Partners or (C) borrowing
money or making draws under any such previously approved credit agreement,
indenture or similar agreement for the purpose of funding authorized
transactions;

         

        (iii)   
   approving
all Budgets, including any annual operating and capital expenditures
budgets;

         

        (iv)   
   authorizing
a transaction (or series of related transactions) involving a lease or similar
arrangement;

         

        (v)    utilizing
for other than Company purposes any material asset (or assets) of the
Company;

         

        (vi)   
   acquiring
or disposing of any asset (or assets) of the Company or its
Subsidiaries;

         

        
          
            
            

          

          
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        (vii)  
   authorizing
a transaction (or series of related transactions) which involves acquiring,
constructing or otherwise obtaining any pipeline, lateral or extension,
including any Lateral, or any pumping, expansion or other
facilities;

         

        (viii)  
   authorizing
material transactions the nature of which are not in the ordinary course of
business of the Company;

         

        (ix)     
   issuing
additional equity interests in any Subsidiary of the Company;

         

        (x) 
    instituting
or settling litigation, arbitration, or similar proceedings against any
Partner;

         

        (xi)
    entering
into any contract, agreement or other undertaking that obligates or commits the
Company or any of its Subsidiaries to incur expenditures;

         

        (xii)    authorizing
any Interested Partner Transaction;

         

        (xiii)   
   permitting
a Partner to dissociate;

         

        (xiv)  
   waiver,
amendment, termination (other than by expiration of the term thereof) or other
modification of the Construction Agreement (or any successor agreement) or the
Operating Agreement (or any successor agreement);  provided, however, that for
purposes of this Section 6.3(b)(xiv), if any
Partner or its Affiliate would be replaced as an operator or construction
manager as a result of such termination, such Partner will not be entitled to
vote on such termination; further provided,
that the vote or consent of such Partners not terminated (to the extent such
Partners are eligible to vote on or consent to such matter) will be sufficient
to take such actions under this Section even if the Partnership Interests held
by such Partners is less than a Majority Interest;

         

        (xv)   
   permitting
dissolution and liquidation; and

         

        (xvi)  
   permitting
the merger, consolidation, participation in a share exchange or other statutory
reorganization of the Company with, or sale of all or substantially all of the
assets of the Company or any of its Subsidiaries to, any Person.

         

        An act of
the Management Committee will occur only by the affirmative vote or written
consent of the applicable Required Interest specified in this Agreement,
including the  Majority Interest approval requirements set forth in
Section 6.1 and other
Partnership Interest approval requirements otherwise set forth in this
Agreement, and to the same extent as such Required Interests apply to the
Partners.

         

        (c)    Management
Committee approval of or agreement to any matter specified in Section 6.3(b)(i)  (including
as to whether the Company should accept any particular quality of Oil in a
proposed Throughput Agreement) shall be granted or withheld based only upon such
Partner’s good faith belief that such approval or agreement, or the


         

        
          
            
            

          

          
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        withholding
of such approval or agreement, is in the best interest of the
Company.  Approval of or agreement to any other matter required under
this Agreement may be withheld by any Partner for any reason whatsoever, in each
Partner’s sole and absolute discretion.

         

        6.4    Officers.

         

        (a)    The
Management Committee may designate one or more Persons to fill one or more
officer positions of the Company to perform such duties as specified by the
Management Committee.  Such officers may include President, Vice
President, Treasurer, Assistant Treasurer, Secretary and Assistant
Secretary.  No officer need be a resident of the State of
Delaware.  The Management Committee may assign titles to particular
officers.  Each officer will hold office until his successor will be
duly designated and will qualify to hold such office for a two-year term, or, if
earlier, until his death or until he will resign or will have been removed in
the manner hereinafter provided.  Any number of offices may be held by
the same Person.  The salaries or other compensation, if any, of the
officers and agents of the Company may be fixed from time to time by the
Partners.  

         

        (b)    Any
officer may resign as such at any time.  Such resignation will be made
in writing and will take effect at the time specified therein, or if no time be
specified, at the time of its receipt by the Company.  The acceptance
of a resignation will not be necessary to make it effective, unless expressly so
provided in the resignation.  Any officer may be removed as such,
either with or without cause, by the Management Committee; provided, however, that such
removal will be without prejudice to the contract rights, if any, of the officer
so removed.  Designation of an officer will not of itself create
contract rights.  Any vacancy occurring in any office of the Company
may be filled by the Management Committee.

         

        6.5    Duties of
Officers. Each
officer will devote such time, effort, and skill to the Company’s business
affairs as he or she deems necessary and proper for the Company’s welfare and
success.  The Partners expressly recognize that the officers have
substantial other business relationships and activities with Persons other than
the Company.

         

        6.6    No Duty to
Consult. Except
as otherwise provided herein or by applicable law, neither the Company nor its
duly appointed agents, designees or representatives (including the Operator and
the Construction Manager) or the officers of the Company will have a duty or
obligation to consult with or seek the advice of the Partners on any matter
relating to the day-to-day business affairs of the Company duly delegated to
such Persons; provided, however, that such
Persons will not be restricted from consulting with or seeking the advice of the
Partners.

         

        6.7    Reimbursement. Except
as otherwise provided in Article IV and except
for expenses incurred by the Partners in connection with preparation of this
Agreement and the Related Agreements, all expenses incurred with respect to the
organization, operation and management of the Company will be borne by the
Company.

         

        
          
            
            

          

          
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        6.8    Partners and Affiliates
Dealing With the Company. Subject
to any approval required under Article VII, the
Company may appoint, employ, contract, or otherwise deal with any Person,
including Partners, Affiliates of the Partners, other Persons with whom the
Partners are otherwise related, and with Persons which have a financial interest
in a Partner or in which a Partner has a financial interest, for transacting
Company business, including any acts or services for the Company as the Partners
of any committee, officer or other representative with the proper authority may
approve.

         

        6.9    Insurance. The
Operator will provide the applicable insurance coverages described on Schedule 2 for the
benefit of the Company and the Partners.  The costs of the insurance
coverages described on Schedule 2 which are
obtained by the Operator will automatically be included in the applicable
operating budget for the Company without the necessity of approval by the
Partners.  All insurance policies provided by the Operator will
provide that the insurers waive their right of subrogation against the Partners,
the Affiliates of each of the foregoing and other indemnitees.

         

        ARTICLE
VII

        MEETINGS

         

        7.1    Meetings of Partners and
Committees;
Required Interest Actions.

         

        (a)    A quorum
will be present at a meeting of the Partners or any committee of the Company if
the holders of at least 67% of all Partnership Interests are represented at the
meeting in person or by proxy who are not then deemed to be a Delinquent Party
but who are still deemed to be an Eligible Partner.  However, if after
two (2) unsuccessful attempts to obtain a quorum, a quorum will be present at
the third such meeting of the Partners or any committee of the Company if the
holders of more than 50% of all Partnership Interests are represented at such
meeting in person or by proxy who are not then deemed to be a Delinquent Party
but who are still deemed to be an Eligible Partner

         

        (b)    All
meetings of the Partners or any committee of the Company will be held at the
principal place of business of the Company or, if otherwise agreed by the
Partners or the committee members, as applicable, at such other place within or
without the State of Delaware as will be specified or fixed in the notices or
waivers of notice thereof; provided that any or all Partners or their
representatives may participate in any such meeting by means of teleconference,
video conference or similar communications equipment pursuant to Section
16.10.  Partners (including representatives thereof serving as
committee members) will use their reasonable efforts to attend each meeting of
the Partners or any committee of the Company.

         

        (c)    Except as
set forth in Section
7.2, a Majority Interest represented (in person or by proxy) at a meeting
at which a quorum is present will have the power to adjourn such meeting from
time to time, without any notice other than an announcement at the meeting of
the time and place of the resumption of the adjourned meeting.  The
time and place of such adjournment will be determined by a vote of such
Partnership Interest.  Upon the resumption of such adjourned meeting,
any business may be transacted that might have been transacted at the meeting as
originally called.

         

        
          
            
            

          

          
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        (d)    Unless
otherwise expressly provided in a written meeting notice issued hereunder,
meetings of the Partners for the transaction of such business as may properly
come before such meeting will be held at least once per quarter at the principal
office of the Company on such dates as to which the Partners mutually
agree.  Regularly scheduled, periodic meetings of the Partners or any
committee of the Company may be held without special notice to the Partners or
Partner representatives at such times and places as will from time to time be
determined by resolution of the Partners or such Partner representatives and
communicated to all Partners or their representatives.  Each Partner,
or its representatives in the case of committee meetings, will use reasonable
efforts to inform the other Partners or committee representatives of any
business matters that it intends to raise at any regular meeting of the Partners
or any committee of the Company within a reasonable time prior to such
meeting.

         

        (e)    Special
meetings of the Partners or any committee of the Company, for any purpose or
purposes, unless otherwise prescribed by applicable Law, will be called by (i)
the President or Secretary (if any), (ii) any one or more of the Non-Defaulting
Partners or (iii) any chairman of a committee with respect to meetings of that
committee.  Such notice will state the purpose or purposes of the
proposed meeting and, unless approved by a Majority Interest, no other business
or purpose may be considered at such meeting.  

         

        (f)    Except as
provided otherwise by this Agreement or applicable Law, written or printed
notice stating the place, day and hour of the meeting and the purpose or
purposes for which such meeting is called, will be delivered not less than 10
nor more than 60 Days (including Saturdays, Sundays and holidays) before the
date of the proposed meeting, either personally, by certified mail (return
receipt requested) or by telecopy (with a copy delivered via United States
mail), by or at the direction of the Person calling the meeting, to each Partner
or Partner representative, as the case may be, entitled to vote thereat;
provided that a Majority Interest may waive objection to any notice delivered
less than 10 Days prior to such meeting.  If mailed, any such notice
will be deemed to be delivered when deposited in the United States mail,
addressed to the Partner, or Partner representative, at its address provided for
in Section
16.16, with postage thereon prepaid.

         

        (g)    The date
on which notice of a meeting of the Partners or any committee of the Company is
mailed will be the Record Date for the determination of the Partners or Partner
representatives entitled to notice of or to vote at such meeting, including any
adjournment thereof, or the Partners or Partner representatives entitled to
receive such notice.

         

        7.2    Special
Actions. Notwithstanding
anything to the contrary set forth herein, the  approval of a
Unanimous Non-Defaulting Interest will be required to authorize and approve the
following, or, with respect to matters to be authorized or approved by
Subsidiaries of the Company, to determine how the Company will vote as a member
of such Subsidiary with respect to the following:

         

        
          
            
            

          

          
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        (a)    For the
business of the Company to be any business other than the business of TOPS or
business directly related to TOPS;

         

        (b)    The
assignment of all or substantially all of the Company’s assets in trust for
creditors or on the assignee’s promise to pay the debts of the
Company;

         

        (c)    Any act
which will make it impossible to carry on the ordinary business of the
Company;

         

        (d)    The
exercise of a right to terminate or the waiver of any right to terminate any
Throughput Agreement;

         

        (e)    The
contribution of any property (other than cash) as a Capital Contribution to the
Company;

         

        (f)    Any
agreement or commitment by the Company to sell, issue, or otherwise dispose of
any Partnership Interests whether pursuant to any option, purchase right, other
contract or commitment or otherwise;

         

        (g)    The
creation of any new class of Partnership Interest;

         

        (h)    Any
change in the voting or other rights applicable to any Partnership Interests or
any change in the attributes of any Partnership Interests, except changes
occurring as remedies to a Default by a Partner;

         

        (i)    Entering
into any material transaction (including without limitation, any Throughput
Agreement with a term in excess of 1 year or a value in excess of 50,000 barrels
per day), except (i) a Throughput Agreement that does not obligate the Company
to expend new capital and is at a throughput fee that the President has
authority to approve, (ii) a long-term Throughput Agreement that has terms
substantially similar to other long-term Throughput Agreements of the Company
that does not obligate the Company to expend new capital, and (iii) any other
transaction of a nature that the Partners mutually agree is not
material;

         

        (j)    Permitting
the merger, consolidation, participation in a share exchange or other statutory
reorganization with, or sale of the assets of, the Company (having a value in
excess of $5,000,000, or of any Subsidiary of the Company, directly or
indirectly, to any Person or permitting the conversion of the Company into a
different form of entity;

         

        (k)    Permitting
winding up and liquidation of the Company;

         

        (l)    Amending
the governing documents of the Company; provided that all of
the other Parties consent to such amendment;

         

        (m)    Entering
into any Interested Partner Transaction;

         

        (n)    Without
regard to any contrary or overriding provisions of the governing documents of
the Company, any other act for which unanimity would otherwise be 

         

        
          
            
            

          

          
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        required
by the statute(s) governing the organization, formation or governance of the
Company;

         

        (o)    Additional
Capital Contributions, beyond those required for the Initial
Facilities;

         

        (p)    Approval
of any Budgets and staffing plan; and/or any amendment to any approved Budget
and/or any deviation of any line item in any previously approved Budget by more
than 10%;

         

        (q)    Incurring
any long-term debt secured by a lien on the Company’s assets;

         

        (r)    Hiring
and/or firing of members of the Company’s senior management team;

         

        (s)    Hiring
and/or firing of the Company’s accountants and/or auditors;

         

        (t)    Entering
into any joint venture or partnership or the acquisition of share or assets of
any other company;

         

        (u)    Consenting
to the settlement or admission of any liability in excess of
$250,000;

         

        (v)    Approval
of the duties, authorities and responsibilities of the President of the
Company;

         

        (w)    Any
change in the reserve requirement, dividend and/or distribution policy of the
Company; or

         

        (x)    Actions
for which this Agreement expressly requires approval of a Unanimous
Non-Defaulting Interest.

         

        7.3    Interested
Partner Transaction. Any
Partner shall have the right to cause the Company to enforce its rights under
any Interested Partner Transaction (including the Operating Agreement) as such
Partner determines is reasonable and appropriate, including but not limited to
such remedies as termination; provided that, such Partner causing the
enforcement of such remedy shall indemnify the Company and the other Partners
from any losses incurred due to a determination by a court of competent
jurisdiction that the enforcement of such remedy was wrongful or otherwise in
breach of such Interested Partner Transaction.

         

        7.4    Voting
List. The
Secretary or Assistant Secretary of the Company or the designated Partner
representative on the committee for the maintenance of the committee’s records
will make, at least five Days before each meeting of Partners or the applicable
committee, a complete list of the Partners or their representatives, as the case
may be, entitled to vote thereat or any adjournment thereof, arranged in
alphabetical order, with the address of and the Partnership Interest held or
represented by each, which list, for a period of ten Days prior to such meeting,
will be kept on file at the registered office or principal place of business of
the Company and will be subject to inspection by any Partner or Partner
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        during
usual business hours.  Such list will also be produced and kept open
at the time and place of the meeting and will be subject to the inspection of
any Partner or Partner representative during the whole time of the
meeting.  The original Company records will be prima facie evidence as
to who are the Partners or their representatives entitled to examine such list
or transfer records or to vote at any meeting of the Partners or the Management
Committee.  Failure to fully comply with the requirements of this
Section 7.4 will not affect
the validity of any action taken at the meeting.

         

        7.5    Proxies. A
Partner or its representative may vote either in person or by proxy executed in
writing by the Partner or Partner representative.  A telegram, telex,
cablegram or similar transmission by the Partner or Partner representative or a
photographic, photostatic, facsimile or similar reproduction of writing executed
by the Partner or Partner representative will be treated as an execution in
writing for purposes of this Section 7.5.  Proxies
for use at any meeting of the Partners or committee of the Company or in
connection with the taking of any action by written consent will be filed with
the Company before or at the time of the meeting or execution of the written
consent, as the case may be.  All proxies will be received and taken
charge of and all ballots will be received and canvassed by an inspector or
inspectors appointed by the President or a Vice President of the Company who
will decide all questions touching upon the qualification of voters, the
validity of the proxies, and the acceptance or rejection of votes.

         

        7.6    Votes. Each
Partner or Partner representative will be entitled to one vote (or a fraction
thereof) per percent (or fraction thereof) of Partnership Interest held by such
Partner, as reflected in the transfer records of the Company; provided, however, that for
purposes of determining a quorum or a Required Interest the Partnership Interest
of any relevant Partner will not be counted and such interest will be
apportioned by interest among the remaining Partners as applicable if the
relevant Partner is not eligible to vote on or consent to the applicable matter
for any reason, including because the relevant Partner is in Default, or is not
deemed to be a Substituted Partner; provided further,
however, that
no Partner will be required to make any Capital Contribution, other than an
Initial Facilities Capital Contribution, if such Partner did not vote to approve
such Capital Contribution in accordance with Section 4.2.  Except
to the extent required by applicable Laws, a Party in Default is not eligible to
vote on or consent to any matter during the existence and continuation of such
Default.

         

        7.7    Conduct of
Meetings. All
meetings of the Partners will be presided over by the chairman of the meeting,
who will be, in order of priority, the President, Vice President or other
appropriate officer of the Company.  All meetings of any committee of
the Company will be presided over by the then acting Chairman or Vice-Chairman
of the Committee or, in such person’s absence, such other person designated by
the Committee.  The chairman of any meeting of the Partners or
committee of the Company will determine the order of business and the procedure
at the meeting, including regulation of the manner of voting and the conduct of
discussion.

         

        7.8    Action by Written
Consent.

         

        (a)    Except as
otherwise provided by applicable Laws, any action required or permitted to be
taken at any meeting of Partners or committee of the Company may be taken
without a meeting, and without a vote, if a consent or consents in writing,
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        forth the
action so taken, is signed by the holder or holders or representatives of not
less than the minimum of Required Interests that would be necessary to take such
action at a meeting at which the holders of all Partnership Interests eligible
to vote on the action were present and voted.  To the extent required
by Law, every written consent will bear the date of signature of each Partner or
Partner representative who signs the consent.  To the extent required
by law, no written consent will be effective to take the action that is the
subject of such consent unless, within 60 Days after the date of the earliest
dated consent delivered to the Company in the manner required by this Section 7.8, a consent or
consents signed by the holder or holders of not less than the minimum Required
Interest that would be necessary to take the action that is the subject of the
consent are delivered to the Company by delivery to its registered office or its
principal place of business.  Delivery will be by hand or certified or
registered mail (return receipt requested) to the Company’s principal place of
business and will be addressed to the Secretary of the Company.  A
telegram, telex, cablegram or similar transmission by a Partner or Partner
representative, or a photographic, photostatic, facsimile or similar
reproduction of a writing signed by a Partner or Partner representative, or an
e-mail, or other electronic communication bearing an electronic or digital
signature, will be regarded as signed by the Partner or Partner representative
for purposes of this Section 7.8.  Prompt
written notice of the taking of any action by the Partners or committees of the
Company without a meeting by less than a Unanimous Interest will be given to
those Partners or Partner representatives who did not consent in writing to the
action.

         

        (b)    The
Record Date for determining Partners or their representatives entitled to
consent to an action in writing without a meeting will be the first date on
which a signed written consent setting forth the action taken or proposed to be
taken is delivered to the Company.

         

        7.9    Resolution of Management
Disputes. If
a Management Dispute occurs, it will be subject to the provisions of this Section 7.9, notwithstanding
any other provision of this Agreement to the contrary.  Upon the
written request by any Partner served on the Company and each of the other
Partners within 10 Days following any vote of the Partners resulting in a
Management Dispute, the senior management-level representatives of the Partners
shall meet in an effort to attempt to resolve the Management
Dispute.  For purposes of this Section 7.9, a “Management Dispute”
means any matter which, after having been duly presented for approval of the
Partners, is not approved by a Required Interest, but which receives the
affirmative vote of a Majority Interest.  If the senior
management-level representatives of the Partners are unable, in good faith, to
resolve in its entirety any Management Dispute, then such Management Dispute
will remain unresolved.

         

        7.10    Records. An
officer of the Company or a designated Partner representative will be
responsible for maintaining the records of the Company, including keeping
minutes at the meetings of the Partners or committees of the Company and the
filing of consents in the records of the Company.

         

        
          
            
            

          

          
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        ARTICLE
VIII

        INDEMNIFICATION

         

        8.1    Right to
Indemnification. Subject
to the limitations and conditions as provided herein or by applicable Laws, each
Person who was or is made a party or is threatened to be made a party to or is
involved in any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative, arbitrative or investigative
(hereinafter a “Proceeding”), or any
appeal in such a Proceeding or any inquiry or investigation that could lead to
such a Proceeding, by reason of the fact that he or she, or a Person of whom he
or she is the legal representative, is or was a Partner, a member of a committee
of the Company or an officer of the Company, or while such a Person is or was
serving at the written request of the Company (as approved by a Majority
Interest of the Partners) as a director, officer, partner, venturer, proprietor,
member, trustee, employee, agent, or similar functionary of another foreign or
domestic general partnership, corporation, limited partnership, joint venture,
limited liability company, sole proprietorship, trust, employee benefit plan or
other enterprise, will be indemnified by the Company to the extent such
Proceeding or other above-described process relates to any such above-described
relationships with, status with respect to, or representation of any such
Person, to the fullest extent permitted by the Act, as the same exists or may
hereafter be amended (but, in the case of any such amendment, only to the extent
that such amendment permits the Company to provide broader indemnification
rights than said Laws permitted the Company to provide prior to such amendment)
against judgments, penalties (including excise and similar taxes and punitive
damages), fines, settlements and reasonable expenses (including attorneys’ fees)
actually incurred by such Person in connection with such Proceeding, and
indemnification under this Section 8.1 will
continue as to a Person who has ceased to serve in the capacity which initially
entitled such Person to indemnity hereunder for any and all liabilities and
damages related to and arising from such Person’s activities while acting in
such capacity; provided, however, that no
Person will be entitled to indemnification under this Section 8.1 in the event the
Proceeding involves acts or omissions of such Person which constitute an
intentional breach of this Agreement or gross negligence or willful misconduct
on the part of such Person or if such Person was acting, willfully and in bad
faith, otherwise than on behalf of the Company or in accordance with this
Agreement or the Related Agreements.  The rights granted pursuant to
this Article
VIII will be deemed contract rights, and no amendment, modification or
repeal of this Article
VIII will have the effect of limiting or denying any such rights with
respect to actions taken or Proceedings arising prior to any such amendment,
modification or repeal.  It is expressly acknowledged that the
indemnification provided in this Article VIII could
involve indemnification for negligence or under theories of strict
liability.

         

        8.2    Indemnification of
Others. The
Company may (upon approval of a Unanimous Interest) indemnify, and advance
expenses to, (a) Persons who are not or were not a Partner, including officers,
employees or agents of (i) any Partner or its Affiliate and (ii) the Company,
and (b) those Persons who are or were serving at the written request of the
Company (as approved by a Majority Interest) as a manager, director, officer,
partner, venturer, proprietor, member, trustee, employee, agent or similar
functionary of another foreign or domestic general partnership, corporation,
limited partnership, joint venture, limited liability company, sole
proprietorship, trust, employee benefit plan or other enterprise against any
liability asserted against such Person and incurred by such Person in such a
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        such a
Person to the same extent that it may indemnify and advance expenses to a
Partner under this Article
VIII.

         

        8.3    Advance
Payment. Any
right to indemnification conferred in Section 8.1 will include a
limited right to be paid or reimbursed by the Company for any and all reasonable
expenses as they are incurred by a Person for whom indemnification under Section 8.1 is available and
who was, or is threatened, to be made a named defendant or respondent in a
Proceeding in advance of the final disposition of the Proceeding and without any
determination as to such Person’s ultimate entitlement to indemnification; provided, however, that the
payment of such expenses incurred by any such Person in advance of final
disposition of a Proceeding will be made only upon delivery to the Company of a
written affirmation by such Person of his good faith belief that he has met the
requirements necessary for indemnification under this Article VIII and a
written undertaking, by or on behalf of such Person, to promptly repay all
amounts so advanced if it will ultimately be determined that such indemnified
Person is not entitled to be indemnified under this Article VIII or
otherwise.

         

        8.4    Appearance as a
Witness. Notwithstanding
any other provision of this Article VIII, the
Company may pay or reimburse expenses incurred by any Person for whom
indemnification is available pursuant to this Article VIII in
connection with such Person’s appearance as a witness or other participation in
a Proceeding relevant to the Company at a time when he is not a named defendant
or respondent in the Proceeding.

         

        8.5    Nonexclusivity of
Rights. The
right to indemnification and the advancement and payment of expenses conferred
in this Article
VIII will not be exclusive of any other right which a Person indemnified
pursuant to Sections
8.1 and 8.2 may have or
hereafter acquire under any Laws, this Agreement, or any other agreement, vote
of Partners or otherwise; provided that any Person that is indemnified hereunder
must promptly reimburse the Company up to such indemnified amounts to the extent
such Person also recovers such costs from another Person.  All
indemnity obligations will first be satisfied by insurance proceeds (if any) and
next by the assets of the Company.

         

        8.6    Insurance; Appointment of
Counsel. The
Company may purchase and maintain indemnification insurance, at its expense, to
protect itself and any Person from any expenses, liabilities, or losses that may
be indemnified under this Article
VIII.  The Company may elect to engage competent counsel to
assume control of the defense of any Proceeding for which it may or must provide
indemnity hereunder.

         

        8.7    Partner
Notification. Any
Person requesting indemnification hereunder must give the Company written notice
of the claim within 30 Days of becoming aware of such claim or five Business
Days prior to the date on which a response to such claim is due, if earlier than
30 Days; provided, that
failure to give such notice shall not preclude indemnification unless the
Company is materially prejudiced by such failure.  All claims for
indemnification and any indemnification of or advance of expenses to any Person
entitled to be indemnified under this Article VIII will be
reported in writing to the Partners with or before the notice or waiver of
notice of the next Partners’ meeting or with or before the next submission to
Partners of a consent to action without a meeting and, in any case, within the
3-month period immediately following the date the indemnification or advance was
made.

         

        
          
            
            

          

          
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        8.8    Savings
Clause. If
this Article
VIII or any portion hereof will be invalidated on any ground by any court
of competent jurisdiction, then the Company will nevertheless indemnify and hold
harmless any Person for whom indemnification is available under Section 8.1 as to costs,
charges and expenses (including attorneys’ fees), judgments, fines and amounts
paid in settlement with respect to any action, suit or proceeding, whether
civil, criminal, administrative or investigative to the full extent permitted by
any applicable portion of this Article VIII that
will not have been invalidated and to the fullest extent permitted by applicable
Laws.

         

        8.9    Scope of
Indemnity. For
the purposes of this Article VIII,
references to the “Company” include all
constituent entities, whether corporations or otherwise, absorbed in a
consolidation or merger as well as the resulting or surviving
entity.  Thus, any Person for whom indemnity or advances are available
under this Article
VIII will stand in the same position under the provisions of this Article VIII with
respect to the resulting or surviving entity as he would have if such merger,
consolidation, or other reorganization never occurred.

         

        ARTICLE
IX

        TAXES

         

        9.1    Tax
Returns. The
Company will cause to be prepared and filed all necessary federal and state
income tax returns for the Company, including making the elections described in
Section 9.2.  Upon
written request by the Company, each Party will furnish to the Company all
pertinent information in its possession relating to Company operations that is
necessary to enable the Company’s income tax returns to be prepared and
filed.

         

        9.2    Tax
Elections. The
Company will make the following elections on the appropriate tax
returns:

         

        (a)    to adopt the
accrual method of accounting;

        


        (b)    an election
pursuant to section 754 of the Code;

        


        (c)    to elect to
amortize the organizational expenses of the Company and the start-up
expenditures of the Company under section 195 of the Code ratably over a period
of 60 months as permitted by section 709(b) of the Code; and

        


        (d)    any other
election that the Company may deem appropriate and in the best interests of the
Company or Partners, as the case may be.

        


        Neither
the Company nor any Partner may make an election for the Company to be excluded
from the application of the provisions of subchapter K of chapter 1 of subtitle
A of the Code or any similar provisions of applicable state law, and no
provision of this Agreement will be construed to sanction or approve such an
election.

         

        9.3    Tax Matters Partner. The
Company will select one of the Partners as the “Tax Matters Partner”
of the Company pursuant to section 6231(a)(7) of the Code.  The Tax
Matters Partner will take such action as may be necessary to cause each Partner
to become a “notice

         

        
          
            
            

          

          
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        partner” within the
meaning of section 6223 of the Code and will inform each Partner of all
significant matters that may come to its attention in its capacity as Tax
Matters Partner by giving notice thereof on or before the fifth Business Day
after becoming aware thereof and, within that time, will forward to each other
Partner copies of all significant written communications it may receive in that
capacity.  The Tax Matters Partner may not take any action
contemplated by sections 6222 through 6232 of the Code without the consent of a
Unanimous Interest, but this sentence does not authorize the Tax Matters Partner
to take any action left to the determination of an individual Partner under
sections 6222 through 6232 of the Code.  The initial Tax Matters
Partner will be Enterprise.  The Tax Matters Partner may be replaced
by a Majority Interest (with respect to which the Tax Matters Partner will be an
“Eligible Partner” unless an Affiliate of the Tax Matters Partner is not serving
as the Operator).

         

        ARTICLE
X

        BOOKS,
RECORDS, REPORTS, AND BANK ACCOUNTS

         

        10.1    Maintenance of
Books. The
Company will keep books and records of accounts and will keep minutes of the
proceedings of its Partners.  The books of account for the Company
will be maintained on an accrual basis in accordance with the terms of this
Agreement and GAAP, except that the Capital Accounts will be maintained in
accordance with Section 4.5.  The
accounting year of the Company will be determined by the Company.  The
initial custodian of the company records will be the Operator.

         

        10.2    Financial
Statements. On
or before the last Day of each calendar month, the Company will cause each
Partner to be furnished with an unaudited balance sheet, income statement,
statement of cash flows and statement of changes in each Partner’s Capital
Account for, or as of the end of, the calendar month immediately preceding such
calendar month, all of which are to be prepared in accordance with
GAAP.  On or before the thirty-first Day of each March, the Company
will cause each Partner to be furnished with audited financial statements,
including a balance sheet, an income statement, a statement of cash flows, and a
statement of changes in each Partner’s Capital Account for, or as of the end of,
the immediately preceding calendar year.  Annual financial statements
must be prepared in accordance with GAAP by an independent auditor approved by a
Majority Interest.  The independent auditor may be replaced upon
approval of a Majority Interest.  The initial auditor of the Company
is Deloitte & Touche LLP.  The Company also may cause to be
prepared or delivered such other reports as a Majority Interest may deem, in the
Eligible Partners’ sole judgment, appropriate.  The Company will bear
the costs of all such reports and financial statements.

         

        10.3    Tax
Statements. On
or before the last Day of July during the existence of the Company, the Company
will cause each Partner to be furnished with all information reasonably
necessary or appropriate to file their appropriate tax reports, including a
schedule of Company book-tax differences for, or as of the end of, the
immediately preceding tax year.  In addition, to the extent reasonably
possible, the Company will cause each Partner to be provided with estimates of
all such information on or before the first Day of February each
year.

         

        10.4    Accounts. The
officers of the Company will establish and maintain one or more separate bank
and investment accounts and arrangements for Company funds in the Company’s name
with financial institutions and firms that the officers of the Company may
determine.  The 

         

        
          
            
            

          

          
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        Company
may not commingle the Company’s funds with the funds of any other
Person.  All such accounts will be and remain the property of the
Company and all funds will be received, held and disbursed for the purposes
specified in this Agreement.  Except as otherwise agreed by a Majority
Interest, the Company may invest Company funds only in (a) readily marketable
securities issued by the United States or any agency or instrumentality thereof
and backed by the full faith and credit of the United States maturing within
three months or less from the date of acquisition, (b) readily marketable
securities issued by any state or municipality within the United States of
America or any political subdivision, agency or instrumentality thereof,
maturing within three months or less from the date of acquisition and rated “A”
or better by any recognized rating agency, (c) readily marketable commercial
paper rated “Prime-1” by Moody’s or “A-1” by Standard and Poor’s (or comparably
rated by such organizations or any successors thereto if the rating system is
changed or there are such successors) and maturing in not more than three months
after the date of acquisition or (d) certificates of deposit or time deposits
issued by any incorporated bank organized and doing business under the Laws of
the United States of America which is rated at least “A” or “A2” by Standard and
Poor’s or Moody’s, which is not in excess of federally insured amounts, and
which matures within three months or less from the date of
acquisition.

         

        ARTICLE
XI

        BANKRUPTCY
OF A PARTNER

         

        11.1    No Dissociation Upon
Bankruptcy. Notwithstanding
any provision herein or in the Act to the contrary, a Party becoming a Bankrupt
Partner will not result in its dissociation under Section 15-601 of the Act
unless all of the other Partners so elect at the time such Partner becomes a
Bankrupt Partner: provided, however, that the
Partners agree that a dissociation caused by any such election of the other
Partners under this Section 11.1 shall
not be deemed “wrongful” and, as a result, shall not trigger any of the remedies
set forth in Section
3.9 (a) – (d).  If all of the other Partners so elect for a
Bankrupt Partner to be dissociated, the Company will not be dissolved or wound
up and the provisions of Subchapter VI and VII of the Act shall
apply.

         

        11.2    Bankrupt
Partners. If
any Party becomes a Bankrupt Partner, the Company, by approval of at least a
Majority Interest or, if the Company does not exercise the relevant option, the
non-Bankrupt Partners which desire to participate, will have the option,
exercisable by notice from the Company or the Partners, as the case may be, to
the Bankrupt Partner (or its representative) at any time prior to the 180th Day
after receipt of notice of the occurrence of the event causing it to become a
Bankrupt Partner, to buy, and, on the exercise of this option, the Bankrupt
Partner or its representative will sell, its Partnership
Interest.  The purchase price will be an amount equal to the Fair
Market Value thereof determined by agreement by the Bankrupt Partner (or its
representative) and the potential purchaser; however, if those Persons do not
agree on the Fair Market Value on or before the 90th Day following the date of
receipt by such potential purchaser of notice of the occurrence of the event
causing the Partner to become a Bankrupt Partner, either such Person, by written
notice to the other, may require the determination of Fair Market Value to be
made by an independent Appraiser specified in such notice.  If the
Person receiving that notice objects on or before the tenth Day following
receipt to the independent Appraiser designated in that notice, and those
Persons otherwise fail to agree on an independent Appraiser, either such Person
may petition the United States District Judge for the Southern District of Texas
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        designate
an independent Appraiser, whose determination of the independent Appraiser,
however designated, is final and binding on all parties.  The Bankrupt
Partner and the potential purchaser each will pay one-half of the costs of the
appraisal and court costs in appointing an Appraiser (if any).  If the
potential purchaser then elects, within ten Days after the Fair Market Value has
been decided by agreement or by an independent Appraiser, to exercise the
purchase option, the purchasing Person will pay the Fair Market Value as so
determined in cash on closing.  The payment to be made to the Bankrupt
Partner or its representative pursuant to this Section 11.2 is in complete
liquidation and satisfaction of all the rights and interest of the Bankrupt
Partner and its representative (and of all Persons claiming by, through, or
under the Bankrupt Partner and its representative) in and in respect of the
Company, including any Partnership Interest, any rights in specific Company
property, and any rights against the Company or its Subsidiaries and its
officers, agents, and representatives and (insofar as the affairs of the Company
are concerned) against the Partners.

         

        ARTICLE
XII

        DISSOLUTION,
LIQUIDATION, AND TERMINATION

         

        12.1    Dissolution. Subject
to the provisions of Section 12.2 and any
applicable Laws, the Company will dissolve and its affairs will be wound up on
the first to occur, and only in the event of, the following:

         

         (a)    the
occurrence of an event that makes it unlawful for all or substantially all of
the business or affairs of the Company to be continued, provided that the
Company has not cured such illegality within 90 Days following receipt of notice
of such event;

         

         (b)    the
consent of a Unanimous Interest;

         

         (c)    entry of
a decree of judicial dissolution of the Company under section 15-801 of the Act;
and

         

         (d)    any event
resulting in only one remaining Partner.

         

        Each
Partner expressly agrees (i) that the bankruptcy or dissociation of a Partner or
any other event described in Section 15-801 of the Act will not cause or result
in the dissolution of the Company and (ii) that it will not, and it expressly
waives its right to, apply to the Delaware Court of Chancery for a decree of
dissolution under Section 15-801(5) of the Act.

         

        12.2    Liquidation and
Termination. Subject
to Sections 3.4, 3.5 and 7.6, upon dissolution
of the Company, a representative of the Company selected by a Majority Interest
will act as a liquidator or may appoint one or more Partners as liquidator
(“Liquidator”).  The
Liquidator will proceed diligently to wind up the affairs of the Company and
make final distributions as provided herein and in the Act.  The costs
of liquidation will be borne as a Company expense.  Until final
distribution, the Liquidator will continue to operate the Company properties for
a reasonable period of time to allow for the sale of all or a part of the assets
thereof with all of the power and authority of the Partners.  The
steps to be accomplished by the Liquidator are as follows:

         

        
          
            
            

          

          
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        (a)    as
promptly as possible after dissolution and again after final liquidation, the
Liquidator will cause a proper accounting to be made of the Company’s assets,
liabilities, and operations through the last Day of the calendar month in which
the dissolution occurs or the final liquidation is completed, as
applicable;

         

        (b)    the
Liquidator will cause any notices required by law to be mailed to each known
creditor of and claimant against the Company in the manner described by such
law;

         

        (c)    subject
to the terms and conditions of this Agreement and the Act (especially section
15-803), the Liquidator will distribute the assets of the Company in the
following order:

         

        (i)    the
Liquidator will pay, satisfy or discharge from Company funds all of the debts,
liabilities and obligations of the Company, including all expenses incurred in
liquidation or otherwise make adequate provision for payment and discharge
thereof (including the establishment of a cash escrow fund for contingent
liabilities in such amount and for such term as the Liquidator may reasonably
determine); provided, however, such
payments will not include any Capital Contributions described in Article IV or any
other obligations in favor of the Partners created by this Agreement other than
a loan made pursuant to any provision;

         

        (ii)    the
Liquidator will pay, satisfy or discharge from Company funds all of the advances
and loans (but not Capital Contributions) made to the Company by Partners, as
described in Section
4.5;
and

         

        (iii)    all
remaining assets of the Company will be distributed to the Partners as
follows:

         

        (A)    the
Liquidator may sell any or all Company property, including to one or more of the
Partners; provided that (x) any
such sale to a Partner is made on an arms length basis under terms which are in
the best interest of the Company and (y) to the extent that any Partner has
participated in an Expansion Option under Section 15.3, the
Liquidator will hire an independent Appraiser to attribute (on the basis of its
then-existing Fair Market Value) the proceeds from the sale of the Company
property between each respective Expansion Project for which a Payout Amount has
not been fully received by the Participating Partners, and all other assets of
the Company (such value for each respective Expansion Project, the “Expansion Liquidation
Value”) and the Liquidator will repay any Partners’ Expansion Option loan
pursuant to Section 15.3,
but only to the extent that there is any Expansion Liquidation Value allocated
to the corresponding Expansion Project, and any resulting gain or loss from each
sale will be computed and allocated to the Capital Accounts of the Partners on a
pro rata basis in accordance with each of their respective Partnership
Interests;

         

        
          
            
            

          

          
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        (B)    with
respect to all Company property that has not been sold, the fair market value of
that property (as determined by the Liquidator using any method of valuation as
it, using its best judgment, deems reasonable) will be determined and the
Capital Accounts of the Partners will be adjusted to reflect the manner in which
the unrealized income, gain, loss, and deduction inherent in property that has
not been reflected in the Capital Accounts previously would be allocated among
the Partners if there were a taxable disposition of that property for such fair
market value of that property on the date of distribution; and

         

        (C)    Company
property will be distributed among the Partners ratably in proportion to each
Partner’s Partnership Interest;

         

        All
distributions in kind to the Partners will be made subject to the liability of
each distributee for costs, expenses, and liabilities theretofore incurred or
for which the Company has committed prior to the date of termination and those
costs, expenses, and liabilities will be allocated to the distributee pursuant
to this Section
12.2.  The
distribution of cash and/or property to a Partner in accordance with the
provisions of this Section 12.2 constitutes a
complete return to the Partner of its Capital Contributions and a complete
distribution to the Partner of its Partnership Interest and all the Company’s
property.  To the extent that a Partner returns funds to the Company,
it has no claim against any other Partner for those funds.

         

        12.3    Provision for Contingent
Claims.

         

        (a)    The
Liquidator will make a reasonable provision to pay all claims and obligations,
including all contingent, conditional or unmatured claims and obligations,
actually known to the Company but for which the identity of the claimant is
unknown; and

         

        (b)    If there
are insufficient assets to both pay the creditors pursuant to Section 12.2(c)(i) and to
establish the provision contemplated by Section 12.3(a), the claims
will be paid as provided for in accordance to their priority, and, among claims
of equal priority, ratably to the extent of assets therefor.

         

        12.4    Deficit Capital
Accounts. Notwithstanding
anything to the contrary contained in this Agreement, and notwithstanding any
custom or rule of law to the contrary, a deficit, if any, in the Capital Account
of any Partner resulting from or attributable to any adjustments, allocations,
losses, deductions, distributions or similar events, including deductions and
losses of the Company (including non-cash items such as depreciation) or
distributions of money pursuant to this Agreement to all Partners ratably in
proportion to their respective Partnership Interests, upon the dissolution and
winding up of the Company will not be an asset of the Company and no such
Partner will be obligated to contribute any amounts to the Company to bring the
balance of such Partner’s Capital Account to zero.

         

        
          
            
            

          

          
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        ARTICLE
XIII

        AMENDMENT
OF THE AGREEMENT

         

        13.1    Amendments to be Adopted by
the Company. Except
to the extent expressly provided to the contrary in this Agreement, each Partner
agrees that the appropriate officer of the Company, in accordance with and
subject to the limitations contained in Article VII, may
amend and execute, swear to, acknowledge, deliver, file and record whatever
documents may be required to reflect:

         

        (a)    a change
in the registered agent or office of the Company;

         

        (b)    admission
or substitution of Partners (or changes in Partnership Interests) effected in
accordance with this Agreement;

         

        (c)    upon
prior written notice to the Partners, a change that is necessary or advisable in
the opinion of the Company to ensure that the Company will not be taxable as a
corporation or otherwise taxed as an entity for federal income tax
purposes;

         

        (d)    an
amendment that is necessary, in the opinion of counsel, to prevent the Company
or its officers from in any manner being subjected to the provisions of the
Investment Company Act of 1940, as amended, or “plan asset” regulations adopted
under the Employee Retirement Income Security Act of 1974, as amended, whether
or not substantially similar to plan asset regulations currently applied or
proposed by the United States Department of Labor; and

         

        (e)    subject
to the terms of Section 3.6, an amendment
that the Company determines in its sole discretion to be necessary or
appropriate in connection with the authorization for issuance of any Partnership
Interest pursuant to Section 3.6.

         

        13.2    Amendment
Procedures. Except
as provided in Section
13.1,
all amendments to this Agreement will be made in accordance with the following
requirements:

         

        (a)    amendments
to this Agreement may be proposed, in writing, by any Partner;

         

        (b)    each such
proposal will contain the text of the proposed amendment;

         

        (c)    if an
amendment is proposed, the Company will seek the written approval of all of the
Parties to this Agreement or call a meeting of the Partners to consider and vote
on such proposed amendment;

         

        (d)    a
proposed amendment will be effective upon its approval by all of the Parties to
this Agreement;

         

        (e)    any
amendment that would materially and adversely affect the rights of any type or
class of Partnership Interests in relation to other types or classes of
Partnership Interests requires the approval of the holders of at least a
majority of the Partnership Interests of such class or type of Partnership
Interest; and

         

        
          
            
            

          

          
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        (f)    the
Company will notify all Record Holders upon final adoption of any proposed
amendment.

         

        ARTICLE
XIV

        PARTNERSHIP
INTERESTS

         

        14.1    Certificates.  Unless
and to the extent the Company elects otherwise, the Partnership Interests will
be uncertificated.

         

        14.2    Registered
Holders.  The
Company will be entitled to recognize the exclusive right of a Person registered
on its books as the owner of the indicated Partnership Interest and will not be
bound to recognize any equitable or other claim to or interest in such
Partnership Interest on the part of any Person other than such registered owner,
whether or not it will have express or other notice thereof, except as otherwise
provided by Law.

         

        ARTICLE
XV

        OTHER
PARTNER AGREEMENTS AND OBLIGATIONS

         

        15.1    Facilities Other than
Initial Facilities. No
Party will, or will permit any of its Affiliates to, directly or indirectly,
enter into any agreement to construct or otherwise consummate any transaction
involving the construction of any Lateral (a “Lateral Opportunity”)
until such Lateral Opportunity has been rejected or otherwise forfeited by the
Company and the Partners, as applicable, in accordance with this Section
15.1.

         

        (a)    Any
Partner may propose that the Company undertake a Lateral Opportunity by
delivering written notice (a “Lateral Opportunity
Notice”) to the Company and each of the other Partners, which Lateral
Opportunity Notice would include the proposed terms and conditions of such
transactions and reasonably sufficient operational and financial information and
other details to allow such Partners to make a reasonably informed decision with
respect to such Lateral Opportunity.  If a Unanimous Interest does not
approve the Lateral Opportunity and deliver notice thereof in writing within 30
Days after the Company receives the Lateral Opportunity Notice that the Company
should undertake such project on the terms and conditions set forth in the
applicable Lateral Opportunity Notice, any Partner voting in favor of such
project will have the right to pursue such project (a “Rejected Lateral
Opportunity”) on the terms and conditions set forth in the applicable
Lateral Opportunity Notice and own any assets related thereto in the proportion
that such Partner’s Partnership Interest is to the Partnership Interest of all
Partners that had (i) voted in favor of such project and (ii) elected to
participate in the Rejected Lateral Opportunity by giving written notice of such
intent to the Company within 50 Days after the Company received the relevant
Lateral Opportunity Notice.  In such event, the Partners (directly or
through their Affiliates) desiring to pursue such Rejected Lateral Opportunity
will be free for a period of 60 Days after such 50-Day period to enter into
definitive agreements, if any, or otherwise consummate the transactions
contemplated by the applicable Lateral Opportunity Notice on the terms and
conditions set forth in the applicable Lateral Opportunity Notice without
further obligation to any Partners or the Company; provided that
following such 60-Day period such Partners (and, to the extent covered by this
Section 15.1,
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        Affiliates)
may not enter into definitive agreements, if any, or otherwise consummate the
transactions with respect to a Rejected Lateral Opportunity without again
offering the same to the Company in accordance with this Section
15.1.

         

        (b)    No
Partner will have any obligation or duty to the Company or the other Partners
with respect to any Rejected Lateral Opportunity to the extent it is covered by
definitive agreements entered into, or otherwise consummated, by such Partners
or their applicable Affiliates after compliance with this Section 15.1 or with
respect to any modification, renewal or extension of the terms of such
definitive agreements with respect to any such Rejected Lateral
Opportunity.  Except as set forth in this Section 15.1, the
construction, operation, maintenance and ownership of each such Rejected Lateral
Opportunity project will not be governed or affected by this Agreement, but will
be governed by the contractual and other arrangements established by the
Partners (or their Affiliates) participating in such project; provided, that no
Partner may vote against or refuse to consent to the interconnection of any such
Rejected Lateral Opportunity project with TOPS unless such Partner reasonably
and in good faith believes that such interconnection would materially damage
TOPS or the Company.

         

        (c)    Any
Partner that delivers a Lateral Opportunity Notice or elects to participate in a
Rejected Lateral Opportunity will deliver a certificate executed by an executive
or similar officer of such Partner to each other Partner certifying that: (i)
such Lateral Opportunity or Rejected Lateral Opportunity is not, directly or
indirectly, related in any way to any past, current or future-contemplated
transaction involving the certifying Partner (including, to the extent covered
by this Section
15.1, its applicable Affiliates) not described in the Lateral Opportunity
Notice and (ii) taken as a whole and, in light of the circumstances in which the
same were made, the Lateral Opportunity Notice does not and will not, to the
best knowledge of the certifying Partner, as of the date when made, contain any
untrue statement of a material fact or omit to state a material fact (other than
omissions that pertain to matters of a general economic nature, matters
generally known to each Partner, or matters of public knowledge that generally
affect any of the industry segments included in the business of the Company)
necessary in order to make the statements contained therein not misleading, and
all financial projections contained in any Lateral Opportunity Notice have been
prepared in good faith based upon assumptions believed by the Partner to be
reasonable.  Any breach of a representation or warranty contained in
such certificate will be deemed to be a breach of a representation or warranty
contained in this Agreement.

         

        15.2    Project
Financings. Each
Partner will be responsible for arranging the financing of its share of Capital
Contributions and advances or loans to or other investments in the Company (if
project financing documents not completed); provided, however, that the
Partners agree to use commercially reasonable, good faith efforts to review and
pursue any project financing arrangement for the Company to the extent the terms
and conditions of such project financing are in the best interest of each of the
Partners.

         

        15.3    Expansion
Option.

         

        
          
            
            

          

          
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        (a)    Any
Partner (the “Exercising Partner”)
will have the right to require the Company to construct, own and operate a
particular Expansion Project (the “Expansion Option”)
if:

         

         (i)    Any
Person (including the Exercising Partner or its Affiliate) has delivered to the
Partners a written notice requesting firm capacity or additional firm capacity
(a “Capacity
Request”) on TOPS to receive, store and deliver Oil under one or more
existing or new Throughput Agreements (including Incremental Volumes, the Oil to
be received, stored and delivered using such requested capacity is referred to
as “Expansion
Throughput”);

         

        (ii)    the
Accessible Capacity is not sufficient practically to handle substantially all of
the Expansion Throughput;

         

        (iii)    such
Expansion Project is necessary to increase the Base Capacity to a level adequate
to allow TOPS to handle the Expansion Throughput;

         

        (iv)    within 60
Days from the date of delivery of such Capacity Request (the “Expansion Option
Period”) (A) the Partners held a meeting, a Unanimous Interest did not
approve such Expansion Project and the Exercising Partner voted in favor of such
Expansion Project at such meeting or (B) the Partners were unable to hold a
meeting through no fault of the Exercising Partner; and

         

        (v)    the
Expansion Option is exercised in accordance with the requirements of Section 15.3(b).

         

        (b)    Exercise.  The
Exercising Partner may exercise the Expansion Option only by delivering, at any
time after such Expansion Project has been rejected or, if no vote was held with
respect to such Expansion Project, after the Expansion Option Period, but in any
case no later than 30 Days after the end of the Expansion Option Period, written
notice of such exercise (the “Expansion Option
Notice”) to the Company and each other Partner.  Whenever an
Exercising Partner delivers an Expansion Option Notice, every other Partner
which voted in favor of the relevant Expansion Project at the last meeting
during which such project was voted on (together with the Exercising Partner,
the “Expansion
Participants”) will have the right to participate, proportionately based
on the relationship of its Partnership Interest to the Partnership Interests of
all of the Expansion Participants, in such project on the same basis as the
Exercising Partner, including the right to receive the Payout Amount out of 80%
of the Expanded Capacity Revenues and the obligation to fund such
project.  Any Expansion Participant which desires to exercise its
right to participate in such project must deliver to the other Partners a notice
substantially similar to that delivered by the original Exercising Partner in
accordance with the terms of this subsection, within 30 Days after it receives
the Expansion Option Notice.  Each Expansion Participant will provide
to the other Expansion Participants and the Company an irrevocable commitment
timely to fund the relevant Expansion Project and, if appropriate, assurances
reasonably satisfactory to the Company and the other Expansion Participants that
the relevant Expansion Participant has the ability to complete such Expansion
Project.  If any Expansion Participant pays any amount to the Company


         

        
          
            
            

          

          
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        in excess
of the amount needed to complete the Expansion Project the Company will
immediately return such excess amount to the Expansion Participant.

         

        (c)    Repayment.  Until
the Expansion Participants have (i) received payment of their share of the
Expanded Capacity Revenues in an aggregate amount equal to the Payout Amount or
(ii) the Company, by vote of a Unanimous Interest, has otherwise paid the
unamortized portion of the Payout Amount to the Expansion Participants as
described below, the Expansion Participants will be paid monthly amounts equal
to 80% of the Expanded Capacity Revenues.  Such amounts will be
allocated among the Expansion Participants in the proportions that the
Partnership Interest of each such Expansion Participant bears to the Partnership
Interests of all such Expansion Participants.  The remaining 20% of
the Expanded Capacity Revenues will be retained by the Company and allocated to
all of the Partners in accordance with Sections 5.1 and
5.2.  After recovery of the Payout Amount or payment by the
Company of the unamortized portion of the Payout Amount to the Expansion
Participants as described below, all of the Expanded Capacity Revenues will be
retained by the Company and allocated to all of the Partners based on their
respective Partnership Interests.  If, at any time, the Company, by
vote of a Unanimous Interest, elects to prepay the unamortized amount of the
Payout Amount, the Company will promptly pay an amount equal to the then
remaining unpaid principal amount of the Payout Amount to the Expansion
Participants, which remaining unpaid principal amount will be calculated by
treating as principal payments two-thirds (2/3rds) of all amounts received by
the Expansion Participants prior to such time in satisfaction of the Payout
Amount.

         

        (d)    Capacity.  Prior
to proceeding with any Expansion Project in accordance with this Section, all of the
Partners will cooperate to establish (i) the Accessible Capacity and (ii) an
expansion design to handle the Expansion Throughput.  If the Partners
cannot agree on any such matter, the Company will engage an independent
engineering consultant (of national prominence with experience in the relevant
geographical area) to resolve each such matter.

         

        (e)    Treatment as
Loan.  Any amount paid by one or more Partners pursuant to
Section 15.3
will be considered to be a limited recourse, partially secured loan from such
Partner to the Company, with such loan payable only from, and secured only by a
security interest granted by the Company in, 80% of the Expanded Capacity
Revenues until such Payout Amount is paid in full.  Except for such
security interest in 80% of the Expanded Capacity Revenues, such loan will be
without recourse against the Company.  The Company will have no
obligation to repay such loan except to the extent that 80% of the Expanded
Capacity Revenues are available.

         

        15.4    Termination
of Throughput Agreement. Any
Partner or Partners may propose that the Company exercise its right according to
the terms of a Throughput Agreement to terminate such Throughput Agreement by
delivering written notice to the Company and each of the other
Partners.  If a Required Interest does not approve the termination of
the Throughput Agreement and the Company does not terminate the Throughput
Agreement by the deadline set forth in such Throughput Agreement for termination
thereof, such Partner or Partners shall have the right to dissociate from the
Company provided such Partner forfeit its investment in the 

         

        
          
            
            

          

          
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        Company
and its right to any buy-out of its interest in the Company and such
dissociation shall not be in breach of this Agreement.  Such
dissociating Partner shall not be obligated to the Company or the other Partners
for any further obligations under this Agreement.

        


        ARTICLE
XVI

        GENERAL
PROVISIONS

         

        16.1    Offset. Whenever
the Company is to pay any sum under this Agreement to any Party, any amounts
that such Party owes the Company may be deducted from that sum before payment
unless the Company has been notified by such Party of a bona fide dispute
concerning any amounts owed and the disputing Party has paid all undisputed
amounts then owed.

         

        16.2    Entire
Agreement; Supersedure. This
Agreement constitutes the entire agreement among the Parties hereto with respect
to the formation and governance of the Company and supersedes (a) all prior oral
or written proposals or agreements, (b) all contemporaneous oral proposals or
agreements and (c) all previous negotiations and all other communications or
understandings between the Parties hereto and their Affiliates with respect
thereto.  The Partners, on behalf of their respective Affiliates,
hereby agree that the Term Sheet for Texas Offshore Port Project executed April
16, 2007 by and among Enterprise Products Operating L.P., TEPPCO Partners, L.P.,
and Oiltanking Houston, L.P., as amended and extended (the “Term Sheet”), is
hereby terminated and of no further force or effect and that all rights under
and provisions of the Term Sheet what would survive such termination are hereby
terminated and waived.

         

        16.3    Waivers. Neither
action taken (including any investigation by or on behalf of any Partner) nor
inaction pursuant to this Agreement, will be deemed to constitute a waiver of
compliance with any representation, warranty, covenant or agreement contained
herein by the Partner not committing such action or inaction.  A
waiver by any Partner of a particular right, including breach of any provision
of this Agreement, will not operate or be construed as a subsequent waiver of
that same right or a waiver of any other right.  Any waiver hereunder
must be express and in writing to constitute a waiver.

         

        16.4    Binding
Effect. This
Agreement will be binding upon and inure to the benefit of the Parties and their
respective heirs, legal representatives, successors and assigns.

         

        16.5    Governing
Law; Jurisdiction; Waiver of Jury Trials; Severability. THIS AGREEMENT HAS BEEN EXECUTED AND
DELIVERED AND WILL BE CONSTRUED, INTERPRETED AND GOVERNED PURSUANT TO AND IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO ANY
CONFLICT OF LAWS PRINCIPLES WHICH, IF APPLIED, MIGHT PERMIT OR REQUIRE THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.  EXCLUSIVE VENUE FOR
ANY LEGAL PROCEEDING ARISING FROM OR RELATING TO THIS AGREEMENT WILL BE HOUSTON,
HARRIS COUNTY, TEXAS. THE PARTIES AGREE THAT THE FEDERAL
AND STATE COURTS LOCATED IN HOUSTON, HARRIS COUNTY, TEXAS SHALL HAVE EXCLUSIVE
JURISDICTION OVER ANY DISPUTE ARISING OUT OF THIS 

         

        
          
            
            

          

          
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        AGREEMENT OR ANY ACTION RELATING TO
THE ENFORCEMENT OF ITS PROVISIONS.

         

        EACH
OF THE PARTIES HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE GOVERNMENT RULE, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO A DISPUTE UNDER
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.

         

        In the
event of a direct conflict between the provisions of this Agreement and any
mandatory provision of the Act or applicable Laws, the applicable provision of
the Act or other applicable Laws, as the case may be, will
control.  If any provision of this Agreement, or the application
thereof to any Person or circumstance, is held invalid or unenforceable to any
extent, the remainder of this Agreement and the application of that provision to
other Persons or circumstances will not be affected thereby and that provision
will be enforced to the greatest extent permitted by the Act or other applicable
Laws, as the case may be.  The Parties agree to negotiate in good
faith to replace any such invalid provision with a valid provision having
similar effect.

         

        16.6    Further
Assurances. Subject
to the terms and conditions set forth in this Agreement, each of the Parties
agrees to use all reasonable efforts to take, or to cause to be taken, all
actions, and to do, or to cause to be done, all things necessary, proper or
advisable under applicable Laws and regulations to consummate and make effective
the transactions contemplated by this Agreement.  In case, at any time
after the execution of this Agreement, any further action is necessary or
desirable to carry out its purposes, the proper officers or directors of the
Parties will take or cause to be taken all such necessary action.

         

        16.7    Waiver of
Certain Rights. Except as
expressly provided in this Agreement, each Party irrevocably waives any right it
may have to maintain any action for dissolution and liquidation of the Company
or for partition of any property of the Company.  Except as expressly
provided in this Agreement, no Party has any rights, and each Party waives any
rights it might otherwise have, to (a) distributions in kind, (b) partition (by
sale or in kind) or (c) statutory buyout upon wrongful dissolution.

         

        16.8    Notice to
Parties of Provisions of this Agreement. By
executing this Agreement, each Party acknowledges that it has actual notice of
all of the provisions of this Agreement.  Each Party hereby agrees
that this Agreement constitutes adequate notice of all such
provisions.

         

        16.9    Counterparts. This
Agreement may be executed in multiple counterparts, each of which, when
executed, will be deemed an original, and all of which will constitute but one
and the same instrument.

         

        16.10    Attendance
via Communications Equipment. Unless
otherwise restricted by law or this Agreement, the Partners or committees may
hold meetings by means of telephone conference or video conference equipment by
means of which all Persons participating in the 

         

        
          
            
            

          

          
            66

            
              

            

          

          
            
            

          

        

         

        meeting
can effectively communicate with each other.  Such participation in a
meeting will constitute presence in person at the meeting, except where a Person
participates in the meeting for the express purpose of objecting to the
transaction of any business on the ground that the meeting is not lawfully
called or convened.

         

        16.11    Reports
to Partners. The
officers of the Company will present at each quarterly meeting of the Partners,
and at any special meeting of the Partners, a statement of the business and
condition of the Company and its Subsidiaries.

         

        16.12    Checks,
Notes and Contracts. Checks
and other orders for the payment of money will be signed by such Person or
Persons as the Company will from time to time by resolution
determine.  Contracts and other instruments or documents may be signed
in the name of the Company by any officer, or any Person as the Company will
from time to time by resolution determine, authorized to sign such contract,
instrument or document by the Company, and such authority may be general or
confined to specific instances.  Checks and other orders for the
payment of money made payable to the Company may be endorsed for deposit to the
credit of the Company, with a depositary authorized by resolution of the
Company, by the President or Treasurer or such other Persons as the Company may
from time to time by resolution determine.

         

        16.13    Books and
Records. The
officers of the Company will keep correct and complete books and records of
account, including the names and addresses of all Partners and the number and
class of the interest held by each, and minutes of the proceedings of the
meetings (and any actions by written consent of) the Company and the Partners
and the committees at its registered office or principal place of business, or
at the office of its transfer agent or registrar.

         

        16.14    Audit Rights of
Partners. Each
Partner will have the right to inspect and audit the books and records of the
Company, to interview Company officers or representatives and to inspect Company
assets and operations.  Such audits will be conducted at the sole cost
of the Partner or Partners requesting same.  The audit rights with
respect to any calendar year or any portion of such year will terminate on and
as of the last Day of the third calendar year immediately following the year in
question.  A Partner may exercise its audit rights hereunder by giving
at least 30 Days written notice to the Company of the desire to perform such
audit, which notice will include the estimated timing and other particulars
related to such audit.  The audit will be conducted during normal
business hours of the Company and may be conducted by the Partner or its
designated auditors, consultants, counsel or other
representatives.  The audit will not unreasonably interfere with the
operation of the Company and its Subsidiaries.  If any financial
statement or other report is not challenged within three years, then it will be
presumed to be accurate.

         

        16.15    No Third Party
Beneficiaries. Except
to the extent a third party is expressly given rights herein, any agreement
herein contained, expressed or implied, will be only for the benefit of the
Partners and their respective legal representatives, successors, and assigns,
and such agreements will not inure to the benefit of any other Person
whomsoever, it being the intention of the Parties hereto that no Person will be
deemed a third party beneficiary of this Agreement except to the extent a third
party is expressly given rights herein.

         

        
          
            
            

          

          
            67

            
              

            

          

          
            
            

          

        

         

        16.16    Notices. Except
as otherwise expressly provided in this Agreement to the contrary (including in
the definition of the term Default), any notice required or permitted to be
given under this Agreement will be in writing (including telex, facsimile,
telecopier or similar writing) and sent to the address of the Partner set forth
below, or to such other more recent address of which the sending Partner
actually has received written notice:

         

        (a)           if
to the Company, to:

        


        Texas
Offshore Port System

        Attn:
Chairman

        15631
Jacintoport Blvd.

        Houston,
Texas 77015

        Phone:  281-457-7900

        Facsimile:  281-457-7991

        


        and to
the Partners; and

        


        (b)           if
to the Partners, to each of the Partners listed on Exhibit A at the
address set forth therein.

        


        Each such
notice, demand or other communication will be effective, if given by registered
or certified mail, return receipt requested, as of the third Day after the date
indicated on the mailing certificate, or if given by any other means, when
delivered at the address specified in this Section 16.16.

         

        16.17    Remedies. Except
as expressly provided herein (including in Section 12.1), the rights,
obligations and remedies created by this Agreement are cumulative and in
addition to any other rights, obligations or remedies otherwise available at law
or in equity.  In lieu of seeking judicial remedies, nothing herein
will be considered an election of remedies.  In addition, any
successful Partner is entitled to recover from any other Partner(s) against whom
any claim or dispute is successfully brought its reasonable costs related to
enforcing this Agreement, including reasonable attorneys’ and experts’ fees, and
arbitration expenses.  NOTWITHSTANDING ANYTHING TO THE
CONTRARY, THE PARTIES WAIVE ANY AND ALL RIGHTS, CLAIMS OR CAUSES OF ACTION
ARISING UNDER THIS AGREEMENT FOR INCIDENTAL, CONSEQUENTIAL, PUNITIVE OR
EXEMPLARY DAMAGES.  A PARTY MAY RECOVER FROM THE OTHER PARTY ALL
COSTS, EXPENSES OR DAMAGES INCLUDING INDIRECT, SPECIAL, CONSEQUENTIAL,
INCIDENTAL, EXEMPLARY, PUNITIVE AND DAMAGES PAID OR OWED TO ANY THIRD PARTY FOR
WHICH SUCH PARTY HAS A RIGHT TO RECOVER FROM THE OTHER
PARTY.

         

        16.18    Grant of Security
Interest. Each
Party grants to the Company a Security Interest in all of such Party’s
Partnership Interest and other rights hereunder (including such Party’s rights
to distributions) to secure the payment and performance of such Party’s
obligations under Section 3.4 and Article
IV.  Each Party grants to the other Partners a Security
Interest in all of such Party’s Partnership Interest and other rights hereunder
(including such Party’s rights to distributions) to secure the payment and
performance of such Party’s obligations to a Lending 

         

        
          
            
            

          

          
            68

            
              

            

          

          
            
            

          

        

         

        Partner
under Section
4.3.  The
Security Interests granted pursuant to this Agreement are subordinate to any
lenders to a Party of a loan for the purposes of financing a Capital
Contribution as may be required by such lenders but otherwise are prior to all
other Security Interests on such collateral (except that they are pari passu as among the
Company and applicable Partners).  The Company and any Partner acting
on behalf of the Company will have the right, in addition to the other rights
and remedies granted to it pursuant to this Agreement or available to it at Law
or in equity, to take any action (including court proceedings and exercising the
rights of a secured party under the Uniform Commercial Code of any applicable
State) that a Required Interest or such Partner may deem appropriate to obtain
payment and/or performance from such Party of any such
obligation.  The failure of such Party to pay or perform any of its
obligations secured hereunder shall constitute a default under the Uniform
Commercial Code of any applicable state and the Company and any Partner (on
behalf of the Company) shall have all rights provided to a secured party
thereunder.  Such Party hereby waives all demands and notices to the
maximum extent permitted by the Uniform Commercial Code of any applicable state
and any other law.  At any time and from time to time, upon the
written request of the Company or any Partner, and at the sole expense of such
Party, any Party will promptly and duly execute and deliver such further
instruments and documents and take such further action as the Company or the
applicable Partner may reasonably request for the purpose of obtaining or
preserving the full benefits of the Security Interests granted hereunder and of
the rights and powers herein granted, including the filing of any financing or
continuation statements under the Uniform Commercial Code in effect in any
jurisdiction with respect to the Security Interests created
hereby.  Each Party hereby authorizes the Company, any other Partner
or either of their respective counsel or representative, at any time and from
time to time, to file financing statements and amendments to financing
statements that describe the collateral covered by such financing statements in
such jurisdictions as the Company or other Partner may deem necessary or
desirable in order to perfect the Security Interests granted
hereby.  Each Party hereby further authorizes the Company, any other
Partner or either of their respective counsel or representative, at any time and
from time to time, to file continuation statements with respect to previously
filed financing statements.  A photographic or other reproduction of
this Agreement will be sufficient as a financing statement for filing in any
jurisdiction.  In the event the Company exercises its remedies
hereunder, and as a result of which the Company acquires any Partnership
Interest of a Party, such Partnership Interest shall be treated as redeemed for
purposes of determining the relative Partnership Interest of the remaining
Partners and such Party shall have no further rights under this Agreement with
respect to such Partnership Interest.

         

        16.19    Default
Budgets. To
the extent that the applicable Required Interest does not approve an operating
or capital expenditure Budget for a relevant period, the Company shall operate
using the applicable Budget for the prior such period, adjusted (without
duplication) to reflect increases or decreases resulting from the following
events, and which shall govern until such time as the Required Interest approves
a new proposed budget, but no later than one year:

         

        (a)    the
operation of escalation or de-escalation provisions in contracts in effect at
such time as a result of the passage of time or the occurrence of events beyond
the control of the Company to the extent such contracts are still in
effect;

         

        
          
            
            

          

          
            69

            
              

            

          

          
            
            

          

        

         

        (b)    elections
made in any prior period under contracts contemplated by the Budget for the
prior period regardless of which party to such contracts makes such
election;

         

        (c)    increases
or decreases in expenses attributable to the effect of employee or contractor
additions or reductions during the prior period contemplated by the Budget for
the prior period;

         

        (d)    changes
in interest expense attributable to any indebtedness of the
Company;

         

        (e)    increases
in overhead expenses in an amount equal to (i) the total of overhead expenses
reflected in the Budget for the prior period multiplied by (ii) the increase in
the Consumer Price Index for All Urban Consumers (CPI-U)
Houston-Galveston-Brazoria, Texas area over the prior period;

         

        (f)    the
reasonably anticipated incidence of costs during such period for any legal,
accounting and other professional fees or disbursements in connection with
events or changes not contemplated at the time of preparation of the Budget for
the prior period;

         

        (g)    decreases
in expenses attributable to non-recurring items reflected in the prior period’s
Budget; and

         

        (h)    any
Expansion Project or any Lateral Opportunity approved by the
Company.

         

        
          
            
            

          

          
            70

            
              

            

          

          
            
            

          

        

         

        The
Parties hereto have executed this Agreement as of the Effective
Date.

         

        
          	 	OILTANKING
      FREEPORT L.P.
	 	    By: OTF GP,
      LLC, its general partner
	 	 
	 	 
	 	By:       /s/ Carlin G.
      Conner                                                   
      
	 	    Carlin G.
      Conner
	 	    President
	 	 
	 	 
	 	TEPPCO O/S PORT SYSTEM,
      LLC
	 	 
	 	 
	 	By:       /s/ John N.
      Goodpasture                                           
	 	    John N.
      Goodpasture
	 	    Vice
      President
	 	 
	 	 
	 	ENTERPRISE OFFSHORE
      PORT
	 	SYSTEM, LLC
	 	 
	 	 
	 	By:       /s/ James
      Guion                                                         
       
	 	    James
      Guion
	 	    Vice
      President


        

         

         

         

         

        
          
            Partnership
Agreement Signature Page

            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        EXHIBIT
A

        OWNERSHIP
INFORMATION

         

        
          	
                   

                  Name
      of Each Partner

                	
                   

                  Address

                	
                  Initial

                  Partnership
      

                  Interest

                
	
                   

                  1)           Oiltanking Freeport
      L.P.

                   

                	
                   

                  15631
      Jacintoport Blvd.

                  Houston,
      Texas 77015

                  Phone:  281-457-7900

                  Facsimile:  281-457-7991

                  Attn:  Office
      of the President

                   

                	
                   

                  33
      1/3%

                
	
                   

                  2)           TEPPCO O/S Port System,
      LLC

                   

                   

                	
                   

                  1100
      Louisiana Street

                  Suite
      1600

                  Houston,
      Texas  77002

                  Phone:  713.381.3939

                  Facsimile:  713.381.4039

                  Attn:
      General Counsel

                   

                	
                   

                  33
      1/3%

                
	
                   

                  3)            Enterprise Offshore Port
      System, LLC

                   

                	
                   

                  1100
      Louisiana Street

                  Suite
      1000

                  Houston,
      Texas  77002

                  Phone:  713.381.6523

                  Facsimile:  713.381.6570

                  Attn:  Executive
      Vice President

                   

                	
                   

                  33
      1/3%

                


        

         

         

         

         

        
          
            Exhibit
A to Partnership Agreement - Page 1

            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        EXHIBIT
B

        TRANSFER
NOTICE FORM

         

        The undersigned hereby gives notice on
[date] to Texas Offshore Port System, a Delaware general partnership (the “Company”), that the
undersigned acquired a ___% general partnership interest in the Company from
[name of transferor] (“Transferor”) on [date
of transfer] (the “Transfer
Date”).  The undersigned hereby unconditionally assumes all of
Transferor’s obligations and liabilities (to the extent accruing on or after the
Transfer Date) under the partnership agreement of the Company as such
partnership agreement (including all schedules, exhibits and attachments
thereto) has been amended, restated, supplemented and otherwise modified from
time to time, and agrees to be bound by all the terms and conditions of such
partnership agreement.


        


        [Insert
signature or signature block, as appropriate.]

        
           

           

           

           

          
            
              Exhibit
B to Partnership Agreement - Page 1

              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

        

        


        EXHIBIT
C

        PARENT
PARTNER GUARANTEES

        


        
          	
                  1.  

                	
                  TOPS
      Partner Performance Guaranty Agreement dated August 14, 2008 by and among
      Enterprise Products Operating LLC, Oiltanking Freeport L.P., TEPPCO O/S
      Port System, LLC and Texas Offshore Port
System.

                


        

         

        
          	
                  2.  

                	
                  TOPS
      Partner Performance Guaranty Agreement dated August 14, 2008 by and among
      TEPPCO Partners, L.P., Enterprise Offshore Port System LLC, Oiltanking
      Freeport L.P. and Texas Offshore Port
System.

                


        

         

        
          	
                  3.  

                	
                  TOPS
      Partner Performance Guaranty Agreement dated August 14, 2008 by and among
      Oiltanking Holding Americas, Inc., Enterprise Offshore Port System LLC,
      TEPPCO O/S Port System, LLC and Texas Offshore Port
  System.

                


        

         

        
          	
                  4.  

                	
                  Comfort
      letter from Oiltanking Freeport, L.P. to Enterprise Offshore Port System
      LLC and TEPPCO O/S Port System, LLC regarding TOPS Partner Specific and
      Limited Guaranty Agreement by and among Oiltanking GmbH, Enterprise
      Offshore Port System LLC, TEPPCO O/S Port System, LLC and Texas Offshore
      Port System.

                


        

      

    

     

     

     

     

    
      
        Exhibit
C to Partnership Agreement - Page 1

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      


      TOPS
PARTNER PERFORMANCE GUARANTY AGREEMENT

      (by
Enterprise Products Operating LLC)

       

      This
Performance Guaranty Agreement (this “Agreement”) dated as
of August 14, 2008, is made by and among Enterprise Products Operating LLC, a
Texas limited liability company (the “Guarantor”),
Oiltanking Freeport L.P., a Texas limited partnership (“Oiltanking”) and
TEPPCO O/S Port System, LLC, a Texas limited liability company (“TEPPCO”) and Texas
Offshore Port System, a Delaware general partnership (“TOPS”, with
Oiltanking, TEPPCO and the Guarantor, each a “Party” and together, the “Parties”).

       

      INTRODUCTION

       

      1.           Contemporaneously
herewith, Oiltanking, TEPPCO and Enterprise Offshore Port System, LLC, a Texas
limited liability company (“Obligor”), are
entering into that certain Partnership Agreement of TOPS, dated the same date as
this Agreement (including the exhibits, annexes and schedules thereto, and as
amended, restated, supplemented and otherwise modified from time to time, the
“Partnership
Agreement”).

       

      2.           Obligor
is a wholly-owned indirect subsidiary of the Guarantor.

       

      3.           It
is the intention of the Parties that TOPS will be direct beneficiary of this
Agreement.

       

      4.           The
Guarantor acknowledges that it will indirectly benefit from Obligor being party
to the Partnership Agreement.

       

      5.           Oiltanking,
TEPPCO and TOPS desire that the Guarantor guarantee Obligor’s performance under
Section 4.1 of the Partnership Agreement (the “Guaranteed
Provision”) upon the terms and conditions set forth herein.

       

      AGREEMENT

       

      For and
in consideration of the premises and mutual covenants herein contained and other
good and valuable consideration (the receipt and sufficiency of which is hereby
acknowledged), the Parties do hereby stipulate and agree as
follows:

       

      1.    Defined
Terms.  Capitalized terms used herein but not defined will have
the meaning given them in the Partnership Agreement.

       

      2.    The
Guaranty.


       

      (a)    Subject
to Section
2(b), Section
2(c) and Section 2(d), the
Guarantor hereby irrevocably and unconditionally guarantees to TOPS the full and
timely performance and discharge (including the payment of money) by Obligor of
all obligations and liabilities of Obligor now existing or hereafter arising
under the Guaranteed Provision (the “Guaranteed
Obligations”) and in each case hereby agrees that if Obligor fails (i) to
pay any undisputed amount when and as the same becomes due and payable by
Obligor to TOPS under the Guaranteed Provision, or (ii) to perform and


       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 2

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      discharge
in full, on a timely basis, any of its respective obligations or liabilities in
accordance with the Guaranteed Provision, the Guarantor will, upon effectiveness
of notice of such failure from TOPS or any Partner, forthwith perform and
discharge any such obligation or liability to TOPS (including the payment of
money) as such performance and discharge is required to be made or done by
Obligor pursuant to the terms of the Guaranteed Provision.  Subject to
Section 2(b),
Section 2(c)
and Section
2(d), the guaranty in the preceding sentence is an absolute, present and
continuing guaranty of performance of obligations (including the payment of
money) and not of collectability and is in no way conditional or contingent upon
any attempt to collect from Obligor or upon any other action, occurrence or
circumstance whatsoever.  Subject to Section 2(b), Section 2(c) and
Section 2(d),
including the appropriate resolution of any applicable “Capital Call Disputes”
as provided under Section 4.1(f) of the Partnership Agreement, it will not be
necessary for TOPS or any Partner, in order to enforce such performance by the
Guarantor, first to institute suit or exhaust its remedies against Obligor, any
other guarantor, or any other Person liable with respect to the Guaranteed
Obligations.

       

      (b)    Notwithstanding
anything to the contrary contained in this Section 2 or
elsewhere in this Agreement, Oiltanking, TEPPCO and TOPS each separately
acknowledge and agree that the Guarantor will have the benefit of and the right
to assert any defenses against the claims of TOPS which are available to Obligor
and which would have also been available to the Guarantor if the Guarantor had
been in the same contractual position as Obligor under the Partnership
Agreement, including the appropriate resolution of any applicable “Capital Call
Dispute” as provided under Section 4.1(f) of the Partnership Agreement, other
than defenses arising from the bankruptcy or insolvency of Obligor.

       

      (c)    This
guaranty is limited in amount.  Notwithstanding anything to the
contrary contained in this Section 2 or
elsewhere in this Agreement, Oiltanking, TEPPCO and TOPS each separately
acknowledge and agree that the Guarantor’s obligations under this Agreement,
inclusive of all attorneys’ fees, expenses and other sums due hereunder, shall
not exceed the aggregate sum of US $700 million.

       

      (d)    Notwithstanding
anything to the contrary contained in this Section 2 or
elsewhere in this Agreement, Oiltanking, TEPPCO and TOPS each separately
acknowledge and agree that the Guarantor’s obligations under this Agreement
shall terminate and be of no further force or effect upon the payment of 100% of
all amounts for costs and expenses incurred on behalf of TOPS related to the
formation of TOPS and of all amounts to be incurred by TOPS to design,
construct, install and place in service the Initial Facilities as necessary to
timely and satisfactorily fulfill all of TOPS’s obligations under the Throughput
Agreements.

       

      3.    Obligations
Absolute.  Subject to Section 2(b), Section 2(c) and
Section 2(d),
the obligations of the Guarantor hereunder will be absolute, continuing and
unconditional and will not be released, discharged or in any way affected, by
any of the following:

       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 3

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (a)    any
amendment, modification of or supplement to the Partnership Agreement or any
other instrument referred to therein or any assignment or transfer of any rights
or obligations thereunder;

       

      (b)    any
extension of the time for the payment of all or any portion of any sums payable
under the Guaranteed Provision or the extension of time for the performance of
any obligations under the Guaranteed Provision;

       

      (c)    any
failure, omission, delay or lack of diligence on the part of TOPS to enforce,
assert or exercise, or any waiver of, any right, privilege, power or remedy
conferred on TOPS by the Guaranteed Provision, or any action on the part of TOPS
granting indulgence or extension of any kind;

       

      (d)    any
bankruptcy, insolvency, readjustment, composition, liquidation, dissolution or
similar proceeding or any other defense that may arise in connection with any
such proceeding with respect to Obligor, the Guarantor or any other
Person;

       

      (e)    any
change in the corporate or partnership structure, existence or ownership of the
Guarantor, Obligor or TOPS (including the termination or liquidation of any such
Person) or  any sale, lease or transfer of any or all of the assets of
the Guarantor, Obligor or TOPS to any Person;

       

      (f)    any
failure on the part of Obligor for any reason to comply with or perform any of
the terms of any other agreement with the Guarantor; or

       

      (g)    any
applicable Law hereafter in effect in any jurisdiction affecting any of the
rights under or terms of the Guaranteed Provision except to the extent any such
Law renders Guarantor’s actions hereunder either unenforceable or
illegal.

       

      4.    Waiver.  The
Guarantor unconditionally waives, to the fullest extent permitted by applicable
Law: (a) except as required under Sections 1.1 (under the definition of
“Default”),  4.1(c) and 4.1(d) of the Partnership Agreement (which
notices TOPS expressly agrees to deliver to Guarantor pursuant to Section 7 hereof),
notice of acceptance hereof, of any action taken or omitted in reliance hereon,
of demand, and of any defaults by Obligor in the payment or performance of any
Guaranteed Obligations, and of any of the matters referred to in Section 3 hereof; (b)
all notices that may otherwise be required by applicable Law or otherwise to
preserve any of the rights of TOPS against the Guarantor, including presentment
to or demand for payment from Obligor or the Guarantor, notice to Obligor of
claims with a court in the event of the bankruptcy of Obligor;
and  (c) any requirement of diligence on the part of
TOPS.

       

      5.    Reinstatement of
Guaranty.  This Agreement will continue to be effective, or be
reinstated, as the case may be, if and to the extent at any time any payment, in
whole or in part, made by Obligor or the Guarantor to TOPS in respect of the
Guaranteed Obligations is rescinded or must otherwise be restored or returned by
TOPS upon the insolvency, bankruptcy, dissolution, liquidation or reorganization
of Obligor, or upon or as a result of the appointment of a custodian, receiver,
trustee or other officer with similar powers with respect to Obligor or any
substantial part of its property, or otherwise, all as though such payments had
not been made and, to the extent permitted by applicable law, in such event the
Guarantor will pay TOPS an amount equal 

       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 4

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      to the
payment that has been rescinded or returned. TOPS will not be required to
litigate or otherwise dispute its obligation to make such repayments if it in
good faith believes that such obligation exists.

       

      6.    Representations, Covenants
and Warranties of Guarantor.  The Guarantor represents,
covenants and warrants as follows as of the date hereof:

       

      (a)    Organization, Good Standing and
Location.  The Guarantor is a limited liability company duly
organized, validly existing and in good standing under the laws of the State of
Texas.  The Guarantor has all requisite power and authority, and all
governmental licenses and permits, to own and operate its properties and to
carry on its businesses as presently conducted, except where the failure to do
so could not reasonably be expected to have a material adverse effect on the
business of the Guarantor and its Subsidiaries taken as a whole.  The
Guarantor has the requisite power to enter into and perform its obligations
under this Agreement.

       

      (b)    Approval and Enforceability of
Agreement.  The execution, delivery and performance of this
Agreement have been duly authorized by all necessary action on the part of the
Guarantor. This Agreement has been duly and validly executed and delivered and
constitutes the legal, valid and binding obligation of the Guarantor,
enforceable against it in accordance with its terms, subject to (i) applicable
bankruptcy, insolvency, moratorium, reorganization, dissolution, receivership
and similar laws affecting the rights and remedies of creditors generally, and
(ii) general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law). Except for such notice,
filings, authorizations, consents, or approvals as have been given, made, or
obtained, respectively, the Guarantor is not required to give any notice to,
make any filings with, or obtain any authorization, consent or approval of, any
Governmental Authority or any other Person to perform its obligations under this
Agreement.  Neither the execution and the delivery of this Agreement
by the Guarantor, nor the performance by the Guarantor of its obligations
hereunder, will in any material respect violate any statute, regulation, rule,
injunction, judgment, order, decree or ruling of any Governmental Authority to
which the Guarantor is subject, or any provision of its charter or bylaws or any
material agreement or instrument to which the Guarantor is a party.

       

      7.    Notices.  Unless
otherwise specifically provided herein, all notices, consents, directions,
approvals, instructions, requests and other communications required or permitted
by the terms hereof will be in writing and addressed in the following
manner:

       

      (a)    If to the
Guarantor, to:

       

      Enterprise
Products Operating LLC

      Attn:  Executive
Vice President

      1100
Louisiana Street, Suite 1000

      Houston,
Texas  77002

      Telephone:  (713)
381-6523

      Fax:  (713)
381-6570

      


    

     

     

    
      


      
        
          
            Exhibit
C to Partnership Agreement - Page 5

             


          

          
             


            
              

            

          

          
             


          

        

      

      


      (b)    If to
Oiltanking, to:

       

      Oiltanking
Freeport L.P.

      Attn:  President

      15631
Jacintoport Blvd.

      Houston,
Texas  77015

      Telephone:  (281)
457-0828

      Fax:  (281)
457-7917

      


      (c)    If to
TEPPCO, to:

       

      TEPPCO
O/S Port System, LLC

      Attn:  General
Counsel

      1100
Louisiana Street

      Suite  1600

      Houston,
Texas  77002

      Telephone:  (713)
381-3939

      Fax:  (713)
381-4039

      


      (d)    If to
TOPS, to:

       

      Texas
Offshore Port System

      Attn:
Chairman

      15631
Jacintoport Blvd.

      Houston,
Texas 77015

      Phone:  281-457-7900

      Facsimile:  281-457-7991

       

      provided, however, that any such
addressee may change its address for communications by notice given as aforesaid
to the other Parties.  Each such notice, demand or other communication
will be effective, if given by registered or certified mail, return receipt
requested, as of the third Day after the date indicated on the mailing
certificate, or if given by any other means, when delivered at the address
specified in this Section 7.

       

      8.    Construction.  Whenever
the context requires: the gender of all words used in this Agreement includes
the masculine, feminine, and neuter; a reference to any person or entity
includes its permitted successors and assigns; the words “hereof,” “herein,”
“hereto,” “hereunder,” and words of similar import when used in this Agreement
will refer to this Agreement as a whole and not to any particular provisions of
this Agreement; articles and other titles or headings are for convenience only
and neither limit nor amplify the provisions of the Agreement itself, and all
references herein to articles, sections or subdivisions thereof will refer to
the corresponding article, section or subdivision thereof of this Agreement
unless specific reference is made to such articles, sections or subdivisions of
another document or instrument; any reference to “includes” or “including” will
mean “includes without limitation” or “including, but not limited to,”
respectively; and any references in the singular will include references in the
plural and vice-versa.

       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 6

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      9.    Severability.  If
any provision of this Agreement, or the application thereof to any Person or
circumstances, shall, for any reason or to any extent, be invalid or
unenforceable, such invalidity or unenforceability will not in any manner affect
or render invalid or unenforceable the remainder of this Agreement, and the
application of that provision to other Persons or circumstances will not be
affected but, rather, will be enforced to the extent permitted by applicable
Law.

       

      10.    Entire Agreement;
Amendment.  This Agreement expresses the entire understanding
of the subject matter hereof; and all other understandings, written or oral, are
hereby merged herein and superseded.  No amendment of or supplement to
this Agreement, or waiver or modification of, or consent under, the terms hereof
will be effective unless in writing and signed by the Party to be bound
thereby.

       

      11.    Term of
Agreement.  Subject to Section 2(c) and
Section 2(d),
this Agreement and all guarantees, covenants and agreements of the Guarantor
contained herein will continue in full force and effect and will not be
discharged until all of the Guaranteed Obligations have terminated, expired or
been indefeasibly paid or otherwise performed and discharged in
full.

       

      12.    Survival of Representations
and Warranties.  All representations and warranties contained
herein or made in writing or on behalf of the Guarantor in connection herewith
will survive the execution and delivery of this Agreement.

       

      13.    Governing Law; Waiver of
Jury Trial.  THIS AGREEMENT WILL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS WITHOUT REGARD
TO ANY CONFLICT OF LAW PRINCIPLES THAT MIGHT PERMIT OR REQUIRE THE APPLICATION
OF THE LAWS OF ANOTHER JURISDICTION. THE VENUE AND JURISDICTION WILL LIE IN
HOUSTON, HARRIS COUNTY, TEXAS.  EACH PARTY IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY
AND ALL RIGHTS TO TRIAL BY JURY IN CONNECTION WITH ANY LITIGATION ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.

       

      14.    Attorneys’
Fees.  In the event of any litigation or other proceedings to
enforce this Agreement, the prevailing party will be entitled to recover all
reasonable attorneys’ fees and expenses incurred in connection
therewith.

       

      15.    Assignment.  Guarantor
shall not assign or pledge any of its rights, duties, and obligations that are
set forth under this Agreement without the prior written consent of TOPS and any
purported assignment or pledge in violation of this Section shall be null and
void; provided, that notwithstanding any such assignment by Guarantor, Guarantor
will remain primarily obligated under this Agreement and will not be released
from any of its obligations hereunder.

       

      16.    No Third-Party
Beneficiaries.  This Agreement is intended for the exclusive
benefit of TOPS, Oiltanking and TEPPCO, and no other Person shall have any
rights hereunder, whether as a third-party beneficiary or
otherwise.

       

      


       

      ********

       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 7

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      IN
WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed and
delivered as of the date and year first written in the Preamble.

       

      
        
          	 	ENTERPRISE
      PRODUCTS OPERATING LLC
	 	 
	 	 
	 	By:       /s/ Bryan
      Bulawa                                                      
      
	 	    Bryan
      Bulawa
	 	    Vice President
      and Treasurer
	 	    
	 	 
	 	OILTANKING FREEPORT L.P.
	 	 
	 	    By: OTF GP,
      LLC, its general partner
	 	 
	 	By:       /s/ Carlin G.
      Conner                                                  
      
	 	    Carlin G.
      Conner
	 	    President
	 	 
	 	 
	 	TEPPCO O/S PORT SYSTEM,
      LLC
	 	 
	 	 
	 	By:       /s/ John N.
      Goodpasture                                          
	 	    John N.
      Goodpasture
	 	    Vice
      President
	 	 
	 	 
	 	TEXAS OFFSHORE PORT
      SYSTEM
	 	 
	 	 
	 	By:       /s/ Carlin G.
      Conner                                                  
	 	    Carlin G.
      Conner
	 	    Chairman


        

         

         

         

        

          
            
              Exhibit
C to Partnership Agreement - Page 8

               


            

            
               


              
                

              

            

            
               


            

          

        

      

    

     

    TOPS
PARTNER PERFORMANCE GUARANTY AGREEMENT

    (by
TEPPCO Partners, L.P.)

     

    This
Performance Guaranty Agreement (this “Agreement”) dated as
of August 14, 2008, is made by and among TEPPCO Partners, L.P., a Delaware
limited partnership (the “Guarantor”),
Oiltanking Freeport L.P., a Texas limited partnership (“Oiltanking”),
Enterprise Offshore Port System, LLC, a Texas limited liability company (“Enterprise”) and
Texas Offshore Port System, a Delaware general partnership (“TOPS”, with
Oiltanking, Enterprise and the Guarantor, each a “Party” and together,
the “Parties”).

     

    INTRODUCTION

     

    1.           Contemporaneously
herewith, Oiltanking, Enterprise and TEPPCO O/S Port System, LLC, a Texas
limited liability company (“Obligor”), are
entering into that certain Partnership Agreement of TOPS, dated the same date as
this Agreement (including the exhibits, annexes and schedules thereto, and as
amended, restated, supplemented and otherwise modified from time to time, the
“Partnership
Agreement”).

     

    2.           Obligor
is a wholly-owned indirect subsidiary of the Guarantor.

     

    3.           It
is the intention of the Parties that TOPS will be direct beneficiary of this
Agreement.

     

    4.           The
Guarantor acknowledges that it will indirectly benefit from Obligor being party
to the Partnership Agreement.

     

    5.           Oiltanking,
Enterprise and TOPS desire that the Guarantor guarantee Obligor’s performance
under Section 4.1 of the Partnership Agreement (the “Guaranteed
Provision”) upon the terms and conditions set forth herein.

     

    AGREEMENT

     

    For and
in consideration of the premises and mutual covenants herein contained and other
good and valuable consideration (the receipt and sufficiency of which is hereby
acknowledged), the Parties do hereby stipulate and agree as
follows:

     

    1.    Defined
Terms.  Capitalized terms used herein but not defined will have
the meaning given them in the Partnership Agreement.

     

    2.    The
Guaranty.

     

    (a)    Subject
to Section
2(b), Section
2(c) and Section 2(d), the
Guarantor hereby irrevocably and unconditionally guarantees to TOPS the full and
timely performance and discharge (including the payment of money) by Obligor of
all obligations and liabilities of Obligor now existing or hereafter arising
under the Guaranteed Provision (the “Guaranteed
Obligations”) and in each case hereby agrees that if Obligor fails (i) to
pay any undisputed amount when and as the same becomes due and payable by
Obligor to TOPS under the Guaranteed Provision, or (ii) to perform and


     

     

     

     

    
      
        Exhibit
C to Partnership Agreement - Page 9

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    discharge
in full, on a timely basis, any of its respective obligations or liabilities in
accordance with the Guaranteed Provision, the Guarantor will, upon effectiveness
of notice of such failure from TOPS or any Partner, forthwith perform and
discharge any such obligation or liability to TOPS (including the payment of
money) as such performance and discharge is required to be made or done by
Obligor pursuant to the terms of the Guaranteed Provision.  Subject to
Section 2(b),
Section 2(c)
and Section
2(d), the guaranty in the preceding sentence is an absolute, present and
continuing guaranty of performance of obligations (including the payment of
money) and not of collectability and is in no way conditional or contingent upon
any attempt to collect from Obligor or upon any other action, occurrence or
circumstance whatsoever.  Subject to Section 2(b), Section 2(c) and
Section 2(d),
including the appropriate resolution of any applicable “Capital Call Disputes”
as provided under Section 4.1(f) of the Partnership Agreement, it will not be
necessary for TOPS or any Partner, in order to enforce such performance by the
Guarantor, first to institute suit or exhaust its remedies against Obligor, any
other guarantor, or any other Person liable with respect to the Guaranteed
Obligations.

     

    (b)    Notwithstanding
anything to the contrary contained in this Section 2 or
elsewhere in this Agreement, Oiltanking, Enterprise and TOPS each separately
acknowledge and agree that the Guarantor will have the benefit of and the right
to assert any defenses against the claims of TOPS which are available to Obligor
and which would have also been available to the Guarantor if the Guarantor had
been in the same contractual position as Obligor under the Partnership
Agreement, including the appropriate resolution of any applicable “Capital Call
Dispute” as provided under Section 4.1(f) of the Partnership Agreement, other
than defenses arising from the bankruptcy or insolvency of Obligor.

     

    (c)    This
guaranty is limited in amount.  Notwithstanding anything to the
contrary contained in this Section 2 or
elsewhere in this Agreement, Oiltanking, Enterprise and TOPS each separately
acknowledge and agree that the Guarantor’s obligations under this Agreement,
inclusive of all attorneys’ fees, expenses and other sums due hereunder, shall
not exceed the aggregate sum of US $700 million.

     

    (d)    Notwithstanding
anything to the contrary contained in this Section 2 or
elsewhere in this Agreement, Oiltanking, Enterprise and TOPS each separately
acknowledge and agree that the Guarantor’s obligations under this Agreement
shall terminate and be of no further force or effect upon the payment of 100% of
all amounts for costs and expenses incurred on behalf of TOPS related to the
formation of TOPS and of all amounts to be incurred by TOPS to design,
construct, install and place in service the Initial Facilities as necessary to
timely and satisfactorily fulfill all of TOPS’s obligations under the Throughput
Agreements.

     

    3.    Obligations
Absolute.  Subject to Section 2(b), Section 2(c) and
Section 2(d),
the obligations of the Guarantor hereunder will be absolute, continuing and
unconditional and will not be released, discharged or in any way affected, by
any of the following:

     

     

     

     

    
      
        Exhibit
C to Partnership Agreement - Page 10

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (a)    any
amendment, modification of or supplement to the Partnership Agreement or any
other instrument referred to therein or any assignment or transfer of any rights
or obligations thereunder;

     

    (b)    any
extension of the time for the payment of all or any portion of any sums payable
under the Guaranteed Provision or the extension of time for the performance of
any obligations under the Guaranteed Provision;

     

    (c)    any
failure, omission, delay or lack of diligence on the part of TOPS to enforce,
assert or exercise, or any waiver of, any right, privilege, power or remedy
conferred on TOPS by the Guaranteed Provision, or any action on the part of TOPS
granting indulgence or extension of any kind;

     

    (d)    any
bankruptcy, insolvency, readjustment, composition, liquidation, dissolution or
similar proceeding or any other defense that may arise in connection with any
such proceeding with respect to Obligor, the Guarantor or any other
Person;

     

    (e)    any
change in the corporate or partnership structure, existence or ownership of the
Guarantor, Obligor or TOPS (including the termination or liquidation of any such
Person) or  any sale, lease or transfer of any or all of the assets of
the Guarantor, Obligor or TOPS to any Person;

     

    (f)    any
failure on the part of Obligor for any reason to comply with or perform any of
the terms of any other agreement with the Guarantor; or

     

    (g)    any
applicable Law hereafter in effect in any jurisdiction affecting any of the
rights under or terms of the Guaranteed Provision except to the extent any such
Law renders Guarantor’s actions hereunder either unenforceable or
illegal.

     

    4.    Waiver.  The
Guarantor unconditionally waives, to the fullest extent permitted by applicable
Law: (a) except as required under Sections 1.1 (under the definition of
“Default”),  4.1(c) and 4.1(d) of the Partnership Agreement (which
notices TOPS expressly agrees to deliver to Guarantor pursuant to Section 7 hereof),
notice of acceptance hereof, of any action taken or omitted in reliance hereon,
of demand, and of any defaults by Obligor in the payment or performance of any
Guaranteed Obligations, and of any of the matters referred to in Section 3 hereof; (b)
all notices that may otherwise be required by applicable Law or otherwise to
preserve any of the rights of TOPS against the Guarantor, including presentment
to or demand for payment from Obligor or the Guarantor, notice to Obligor of
claims with a court in the event of the bankruptcy of Obligor;
and  (c) any requirement of diligence on the part of
TOPS.

     

    5.    Reinstatement of
Guaranty.  This Agreement will continue to be effective, or be
reinstated, as the case may be, if and to the extent at any time any payment, in
whole or in part, made by Obligor or the Guarantor to TOPS in respect of the
Guaranteed Obligations is rescinded or must otherwise be restored or returned by
TOPS upon the insolvency, bankruptcy, dissolution, liquidation or reorganization
of Obligor, or upon or as a result of the appointment of a custodian, receiver,
trustee or other officer with similar powers with respect to Obligor or any
substantial part of its property, or otherwise, all as though such payments had
not been made and, to the extent permitted by applicable law, in such event the
Guarantor will pay TOPS an amount equal 

     

     

     

     

    
      
        Exhibit
C to Partnership Agreement - Page 11

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    to the
payment that has been rescinded or returned.  TOPS will not be
required to litigate or otherwise dispute its obligation to make such repayments
if it in good faith believes that such obligation exists.

     

    6.    Representations, Covenants
and Warranties of Guarantor.  The Guarantor represents,
covenants and warrants as follows as of the date hereof:

     

    (a)    Organization, Good Standing and
Location.  The Guarantor is a limited partnership duly
organized, validly existing and in good standing under the laws of the State of
Texas.  The Guarantor has all requisite power and authority, and all
governmental licenses and permits, to own and operate its properties and to
carry on its businesses as presently conducted, except where the failure to do
so could not reasonably be expected to have a material adverse effect on the
business of the Guarantor and its Subsidiaries taken as a whole.  The
Guarantor has the requisite power to enter into and perform its obligations
under this Agreement.

     

    (b)    Approval and Enforceability of
Agreement.  The execution, delivery and performance of this
Agreement have been duly authorized by all necessary action on the part of the
Guarantor. This Agreement has been duly and validly executed and delivered and
constitutes the legal, valid and binding obligation of the Guarantor,
enforceable against it in accordance with its terms, subject to (i) applicable
bankruptcy, insolvency, moratorium, reorganization, dissolution, receivership
and similar laws affecting the rights and remedies of creditors generally, and
(ii) general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law). Except for such notice,
filings, authorizations, consents, or approvals as have been given, made, or
obtained, respectively, the Guarantor is not required to give any notice to,
make any filings with, or obtain any authorization, consent or approval of, any
Governmental Authority or any other Person to perform its obligations under this
Agreement.  Neither the execution and the delivery of this Agreement
by the Guarantor, nor the performance by the Guarantor of its obligations
hereunder, will in any material respect violate any statute, regulation, rule,
injunction, judgment, order, decree or ruling of any Governmental Authority to
which the Guarantor is subject, or any provision of its charter or bylaws or any
material agreement or instrument to which the Guarantor is a party.

     

    7.    Notices.  Unless
otherwise specifically provided herein, all notices, consents, directions,
approvals, instructions, requests and other communications required or permitted
by the terms hereof will be in writing and addressed in the following
manner:

     

    (a)    If to the
Guarantor, to:

     

    TEPPCO
Partners, L.P.

    Attn:  General
Counsel

    1100
Louisiana Street

    Suite  1600

    Houston,
Texas  77002

    Telephone:  (713)
381-3939

    Fax:  (713)
381-4039


     

     

     

     

    


    
      
        
          Exhibit
C to Partnership Agreement - Page 12

           


        

        
           


          
            

          

        

        
           


        

      

    

    


    (b)    If to
Oiltanking, to:

     

    Oiltanking
Freeport L.P.

    Attn:  Office
of the President

    15631
Jacintoport Blvd.

    Houston,
Texas  77015

    Telephone:  (281)
457-0828

    Fax:  (281)
457-7917

    


    (c)    If to
Enterprise, to:

     

    Enterprise
Offshore Port System, LLC

    Attn:  Executive
Vice President

    1100
Louisiana Street, Suite 1000

    Houston,
Texas  77002

    Telephone:  (713)
381-6523

    Fax:  (713)
381-6570

     

    (d)    If to
TOPS, to:

     

    Texas
Offshore Port System

    Attn:
Chairman

    15631
Jacintoport Blvd.

    Houston,
Texas 77015

    Phone:  281-457-7900

    Facsimile:  281-457-7991

     

    provided, however, that any such
addressee may change its address for communications by notice given as aforesaid
to the other Parties.  Each such notice, demand or other communication
will be effective, if given by registered or certified mail, return receipt
requested, as of the third Day after the date indicated on the mailing
certificate, or if given by any other means, when delivered at the address
specified in this Section 7.

     

    8.    Construction.  Whenever
the context requires: the gender of all words used in this Agreement includes
the masculine, feminine, and neuter; a reference to any person or entity
includes its permitted successors and assigns; the words “hereof,” “herein,”
“hereto,” “hereunder,” and words of similar import when used in this Agreement
will refer to this Agreement as a whole and not to any particular provisions of
this Agreement; articles and other titles or headings are for convenience only
and neither limit nor amplify the provisions of the Agreement itself, and all
references herein to articles, sections or subdivisions thereof will refer to
the corresponding article, section or subdivision thereof of this Agreement
unless specific reference is made to such articles, sections or subdivisions of
another document or instrument; any reference to “includes” or “including” will
mean “includes without limitation” or “including, but not limited to,”
respectively; and any references in the singular will include references in the
plural and vice-versa.

     

    9.    Severability.  If
any provision of this Agreement, or the application thereof to any Person or
circumstances, shall, for any reason or to any extent, be invalid or
unenforceable, such 

     

     

     

     

    
      
        Exhibit
C to Partnership Agreement - Page 13

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    invalidity
or unenforceability will not in any manner affect or render invalid or
unenforceable the remainder of this Agreement, and the application of that
provision to other Persons or circumstances will not be affected but, rather,
will be enforced to the extent permitted by applicable Law.

     

    10.    Entire Agreement;
Amendment.  This Agreement expresses the entire understanding
of the subject matter hereof; and all other understandings, written or oral, are
hereby merged herein and superseded.  No amendment of or supplement to
this Agreement, or waiver or modification of, or consent under, the terms hereof
will be effective unless in writing and signed by the Party to be bound
thereby.

     

    11.    Term of
Agreement.  Subject to Section 2(c) and
Section 2(d),
this Agreement and all guarantees, covenants and agreements of the Guarantor
contained herein will continue in full force and effect and will not be
discharged until all of the Guaranteed Obligations have terminated, expired or
been indefeasibly paid or otherwise performed and discharged in
full.

     

    12.    Survival of Representations
and Warranties.  All representations and warranties contained
herein or made in writing or on behalf of the Guarantor in connection herewith
will survive the execution and delivery of this Agreement.

     

    13.    Governing Law; Waiver of
Jury Trial.  THIS AGREEMENT WILL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS WITHOUT REGARD
TO ANY CONFLICT OF LAW PRINCIPLES THAT MIGHT PERMIT OR REQUIRE THE APPLICATION
OF THE LAWS OF ANOTHER JURISDICTION. THE VENUE AND JURISDICTION WILL LIE IN
HOUSTON, HARRIS COUNTY, TEXAS.  EACH PARTY IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY
AND ALL RIGHTS TO TRIAL BY JURY IN CONNECTION WITH ANY LITIGATION ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.

     

    14.    Attorneys’
Fees.  In the event of any litigation or other proceedings to
enforce this Agreement, the prevailing party will be entitled to recover all
reasonable attorneys’ fees and expenses incurred in connection
therewith.

     

    15.    Assignment.  Guarantor
shall not assign or pledge any of its rights, duties, and obligations that are
set forth under this Agreement without the prior written consent of TOPS and any
purported assignment or pledge in violation of this Section shall be null and
void; provided, that notwithstanding any such assignment by Guarantor, Guarantor
will remain primarily obligated under this Agreement and will not be released
from any of its obligations hereunder.

     

    16.    No Third-Party
Beneficiaries.  This Agreement is intended for the exclusive
benefit of TOPS, Oiltanking and Enterprise, and no other Person shall have any
rights hereunder, whether as a third-party beneficiary or
otherwise.


     

    ********

     

     

     

    
 

    
      
        
          Exhibit
C to Partnership Agreement - Page 14

           


        

        
           


          
            

          

        

        
           


        

      

    

    


    IN
WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed and
delivered as of the date and year first written in the Preamble.

     

    
      
        
          	 	TEPPCO
      PARTNERS, L.P.
	 	 
	 	
                  By:  Texas
      Eastern Products Pipeline Company, LLC, its general
  partner

                
	 	 
	 	By:       /s/ William G.
      Manias                                                      
      
	 	    William G.
      Manias
	 	    Vice President
      and Chief Financial Officer
	 	    
	 	 
	 	OILTANKING FREEPORT L.P.
	 	 
	 	    By: OTF GP,
      LLC, its general partner
	 	 
	 	By:       /s/ Carlin G.
      Conner                                                          
	 	    Carlin G.
      Conner
	 	    President
	 	 
	 	 
	 	ENTERPRISE OFFSHORE PORT
      SYSTEM,  LLC
	 	 
	 	 
	 	By:       /s/ James
      Guion                                                                 
	 	    James
      Guion
	 	    Vice
      President
	 	 
	 	 
	 	TEXAS OFFSHORE PORT
      SYSTEM
	 	 
	 	 
	 	By:       /s/ Carlin G.
      Conner                                                           
	 	    Carlin G.
      Conner
	 	    Chairman


        

         

         

         

        

          
            
              Exhibit
C to Partnership Agreement - Page 15

               


            

            
               


              
                

              

            

            
               


            

          

        

         

      

    

    TOPS
PARTNER PERFORMANCE GUARANTY AGREEMENT

    (by
Oiltanking Holding Americas, Inc.)

     

    This
Performance Guaranty Agreement (this “Agreement”) dated as
of August 14, 2008, is made by and among Oiltanking Holding Americas, Inc., a
Delaware corporation (the “Guarantor”),
Enterprise Offshore Port System, LLC, a Texas limited liability company (“Enterprise”), TEPPCO
O/S Port System, LLC, a Texas limited liability company (“TEPPCO”) and Texas
Offshore Port System, a Delaware general partnership (“TOPS”, with
Enterprise, TEPPCO and the Guarantor, each a “Party” and together, the “Parties”).

     

    INTRODUCTION

     

    A.           Contemporaneously
herewith, Enterprise, TEPPCO and Oiltanking Freeport L.P., a Texas limited
partnership (“Obligor”), are
entering into that certain Partnership Agreement of TOPS, dated the same date as
this Agreement (including the exhibits, annexes and schedules thereto, and as
amended, restated, supplemented and otherwise modified from time to time, the
“Partnership
Agreement”).

     

    B.           Guarantor
is the sole limited partner of Obligor.  The general partner of
Obligor, OTF GP, LLC, a Texas limited liability company, is a wholly-owned
direct subsidiary of the Guarantor.

     

    C.           It
is the intention of the Parties that TOPS will be the direct beneficiary of this
Agreement.

     

    D.           The
Guarantor acknowledges that it will indirectly benefit from Obligor being party
to the Partnership Agreement.

     

    E.           Enterprise,
TEPPCO and TOPS desire that the Guarantor guarantee Obligor’s performance under
Section 4.1 of the Partnership Agreement (the “Guaranteed
Provision”) upon the terms and conditions set forth herein.

     

    AGREEMENT

     

    For and
in consideration of the premises and mutual covenants herein contained and other
good and valuable consideration (the receipt and sufficiency of which is hereby
acknowledged), the Parties do hereby stipulate and agree as
follows:

     

    1.    Defined
Terms.  Capitalized terms used herein but not defined will have
the meaning given them in the Partnership Agreement.

     

    2.    The
Guaranty.


     

    (a)    Subject
to Section
2(b), Section
2(c) and Section 2(d), the
Guarantor hereby irrevocably and unconditionally guarantees to TOPS the full and
timely performance and discharge (including the payment of money) by Obligor of
all obligations and liabilities of Obligor now existing or hereafter arising
under the Guaranteed Provision (the “Guaranteed
Obligations”) and in each case hereby agrees that 

     

     

     

     

    
      
        Exhibit
C to Partnership Agreement - Page 16

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    if
Obligor fails (i) to pay any undisputed amount when and as the same becomes due
and payable by Obligor to TOPS under the Guaranteed Provision, or (ii) to
perform and discharge in full, on a timely basis, any of its respective
obligations or liabilities in accordance with the Guaranteed Provision, the
Guarantor will, upon effectiveness of notice of such failure from TOPS or any
Partner, forthwith perform and discharge any such obligation or liability to
TOPS (including the payment of money) as such performance and discharge is
required to be made or done by Obligor pursuant to the terms of the Guaranteed
Provision.  Subject to Section 2(b), Section 2(c) and
Section 2(d),
the guaranty in the preceding sentence is an absolute, present and continuing
guaranty of performance of obligations (including the payment of money) and not
of collectability and is in no way conditional or contingent upon any attempt to
collect from Obligor or upon any other action, occurrence or circumstance
whatsoever.  Subject to Section 2(b), Section 2(c) and
Section 2(d),
including the appropriate resolution of any applicable “Capital Call Disputes”
as provided under Section 4.1(f) of the Partnership Agreement, it will not be
necessary for TOPS or any Partner, in order to enforce such performance by the
Guarantor, first to institute suit or exhaust its remedies against Obligor, any
other guarantor, or any other Person liable with respect to the Guaranteed
Obligations.

     

    (b)    Notwithstanding
anything to the contrary contained in this Section 2 or
elsewhere in this Agreement, Enterprise, TEPPCO and TOPS each separately
acknowledge and agree that the Guarantor will have the benefit of and the right
to assert any defenses against the claims of TOPS which are available to Obligor
and which would have also been available to the Guarantor if the Guarantor had
been in the same contractual position as Obligor under the Partnership
Agreement, including the appropriate resolution of any applicable “Capital Call
Dispute” as provided under Section 4.1(f) of the Partnership Agreement, other
than defenses arising from the bankruptcy or insolvency of Obligor.

     

    (c)    This
guaranty is limited in amount.  Notwithstanding anything to the
contrary contained in this Section 2 or
elsewhere in this Agreement, Enterprise, TEPPCO and TOPS each separately
acknowledge and agree that the Guarantor’s obligations under this Agreement,
inclusive of all attorneys’ fees, expenses and other sums due hereunder, shall
not exceed the aggregate sum of US $700 million.

     

    (d)    Notwithstanding
anything to the contrary contained in this Section 2 or
elsewhere in this Agreement, Enterprise, TEPPCO and TOPS each separately
acknowledge and agree that the Guarantor’s obligations under this Agreement
shall terminate and be of no further force or effect upon the payment of 100% of
all amounts for costs and expenses incurred on behalf of TOPS related to the
formation of TOPS and of all amounts to be incurred by TOPS to design,
construct, install and place in service the Initial Facilities as necessary to
timely and satisfactorily fulfill all of TOPS’s obligations under the Throughput
Agreements.

     

    3.    Obligations
Absolute.  Subject to Section 2(b), Section 2(c) and
Section 2(d),
the obligations of the Guarantor hereunder will be absolute, continuing and
unconditional and will not be released, discharged or in any way affected, by
any of the following:

     

     

     

     

    
      
        Exhibit
C to Partnership Agreement - Page 17

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (a)    any
amendment, modification of or supplement to the Partnership Agreement or any
other instrument referred to therein or any assignment or transfer of any rights
or obligations thereunder;

     

    (b)    any
extension of the time for the payment of all or any portion of any sums payable
under the Guaranteed Provision or the extension of time for the performance of
any obligations under the Guaranteed Provision;

     

    (c)    any
failure, omission, delay or lack of diligence on the part of TOPS to enforce,
assert or exercise, or any waiver of, any right, privilege, power or remedy
conferred on TOPS by the Guaranteed Provision, or any action on the part of TOPS
granting indulgence or extension of any kind;

     

    (d)    any
bankruptcy, insolvency, readjustment, composition, liquidation, dissolution or
similar proceeding or any other defense that may arise in connection with any
such proceeding with respect to Obligor, the Guarantor or any other
Person;

     

    (e)    any
change in the corporate or partnership structure, existence or ownership of the
Guarantor, Obligor or TOPS (including the termination or liquidation of any such
Person) or  any sale, lease or transfer of any or all of the assets of
the Guarantor, Obligor or TOPS to any Person;

     

    (f)    any
failure on the part of Obligor for any reason to comply with or perform any of
the terms of any other agreement with the Guarantor; or

     

    (g)    any
applicable Law hereafter in effect in any jurisdiction affecting any of the
rights under or terms of the Guaranteed Provision except to the extent any such
Law renders Guarantor’s actions hereunder either unenforceable or
illegal.

     

    4.    Waiver.  The
Guarantor unconditionally waives, to the fullest extent permitted by applicable
Law: (a) except as required under Sections 1.1 (under the definition of
“Default”), 4.1(c) and 4.1(d) of the Partnership Agreement (which notices TOPS
expressly agrees to deliver to Guarantor pursuant to Section 7 hereof),
notice of acceptance hereof, of any action taken or omitted in reliance hereon,
of demand, and of any defaults by Obligor in the payment or performance of any
Guaranteed Obligations, and of any of the matters referred to in Section 3 hereof; (b)
all notices that may otherwise be required by applicable Law or otherwise to
preserve any of the rights of TOPS against the Guarantor, including presentment
to or demand for payment from Obligor or the Guarantor, notice to Obligor of
claims with a court in the event of the bankruptcy of Obligor;
and  (c) any requirement of diligence on the part of
TOPS.

     

    5.    Reinstatement of
Guaranty.  This Agreement will continue to be effective, or be
reinstated, as the case may be, if and to the extent at any time any payment, in
whole or in part, made by Obligor or the Guarantor to TOPS in respect of the
Guaranteed Obligations is rescinded or must otherwise be restored or returned by
TOPS upon the insolvency, bankruptcy, dissolution, liquidation or reorganization
of Obligor, or upon or as a result of the appointment of a custodian, receiver,
trustee or other officer with similar powers with respect to Obligor or any
substantial part of its property, or otherwise, all as though such payments had
not been made and, to the extent permitted by applicable law, in such event the
Guarantor will pay TOPS an amount equal 

     

    
      
        Exhibit
C to Partnership Agreement - Page 18

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    to the
payment that has been rescinded or returned.  TOPS will not be
required to litigate or otherwise dispute its obligation to make such repayments
if it in good faith believes that such obligation exists.

     

    6.    Representations, Covenants
and Warranties of Guarantor.  The Guarantor represents,
covenants and warrants as follows as of the date hereof:

     

    (a)    Organization, Good Standing and
Location.  The Guarantor is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Delaware.  The Guarantor has all requisite power and authority, and
all governmental licenses and permits, to own and operate its properties and to
carry on its businesses as presently conducted, except where the failure to do
so could not reasonably be expected to have a material adverse effect on the
business of the Guarantor and its Subsidiaries taken as a whole.  The
Guarantor has the requisite power to enter into and perform its obligations
under this Agreement.

     

    (b)    Approval and Enforceability of
Agreement.  The execution, delivery and performance of this
Agreement have been duly authorized by all necessary action on the part of the
Guarantor.  This Agreement has been duly and validly executed and
delivered and constitutes the legal, valid and binding obligation of the
Guarantor, enforceable against it in accordance with its terms, subject to (i)
applicable bankruptcy, insolvency, moratorium, reorganization, dissolution,
receivership and similar laws affecting the rights and remedies of creditors
generally, and (ii) general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at
law).  Except for such notice, filings, authorizations, consents, or
approvals as have been given, made, or obtained, respectively, the Guarantor is
not required to give any notice to, make any filings with, or obtain any
authorization, consent or approval of, any Governmental Authority or any other
Person to perform its obligations under this Agreement.  Neither the
execution and the delivery of this Agreement by the Guarantor, nor the
performance by the Guarantor of its obligations hereunder, will in any material
respect violate any statute, regulation, rule, injunction, judgment, order,
decree or ruling of any Governmental Authority to which the Guarantor is
subject, or any provision of its charter or bylaws or any material agreement or
instrument to which the Guarantor is a party.

     

    7.    Notices.  Unless
otherwise specifically provided herein, all notices, consents, directions,
approvals, instructions, requests and other communications required or permitted
by the terms hereof will be in writing and addressed in the following
manner:

     

    (a)    If to the
Guarantor, to:

     

    Oiltanking
Holding Americas, Inc.

    Attn:  Donna
Hymel

    103 Fouke
Road

    Suite
202

    Wilmington,
Delaware  19803

    Telephone:  302-691-6055

    Fax:
302-652-8667

    


     

     

     

    
 

    
      
        
          Exhibit
C to Partnership Agreement - Page 19

           


        

        
           


          
            

          

        

        
           


        

      

    

    


    With
copies to:

     

    Oiltanking
Freeport, L.P.

    Attn:  Office
of the President

    15631
Jacintoport Blvd.

    Houston,
Texas  77015

    Telephone:  281-457-7900

    Fax:  281-457-7991

     

    and

     

    Oiltanking
GmbH

    Attn:  Jan Vogel

    Admiralitaetstrasse
55

    Hamburg,
Germany

    D20459

    Telephone:  011
49 40 370 04 990

    Fax:  011
49 40 370 99 499

     

    (b)    If to
Enterprise, to:

     

    Enterprise
Offshore Port System, LLC

    Attn:  Executive
Vice President

    1100
Louisiana Street, Suite 1000

    Houston,
Texas  77002

    Telephone:  713-381-6523

    Fax:  713-381-6570

    


    (c)    If to
TEPPCO, to:

     

    TEPPCO
O/S Port System, LLC

    Attn:  General
Counsel

    1100
Louisiana Street

    Suite  1600

    Houston,
Texas  77002

    Telephone:  (713)
381-3939

    Fax:  (713)
381-4039

     

    (d)    If to
TOPS, to:

     

    Texas
Offshore Port System

    Attn:
Chairman

    15631
Jacintoport Blvd.

    Houston,
Texas 77015

    Phone:  281-457-7900

    Facsimile:  281-457-7991

     

     

     

     

    
      
        Exhibit
C to Partnership Agreement - Page 20

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    provided, however, that any such
addressee may change its address for communications by notice given as aforesaid
to the other Parties.  Each such notice, demand or other communication
will be effective, if given by registered or certified mail, return receipt
requested, as of the third Day after the date indicated on the mailing
certificate, or if given by any other means, when delivered at the address
specified in this Section 7.

     

    8.    Construction.  Whenever
the context requires: the gender of all words used in this Agreement includes
the masculine, feminine, and neuter; a reference to any person or entity
includes its permitted successors and assigns; the words “hereof,” “herein,”
“hereto,” “hereunder,” and words of similar import when used in this Agreement
will refer to this Agreement as a whole and not to any particular provisions of
this Agreement; articles and other titles or headings are for convenience only
and neither limit nor amplify the provisions of the Agreement itself, and all
references herein to articles, sections or subdivisions thereof will refer to
the corresponding article, section or subdivision thereof of this Agreement
unless specific reference is made to such articles, sections or subdivisions of
another document or instrument; any reference to “includes” or “including” will
mean “includes without limitation” or “including, but not limited to,”
respectively; and any references in the singular will include references in the
plural and vice-versa.

     

    9.    Severability.  If
any provision of this Agreement, or the application thereof to any Person or
circumstances, shall, for any reason or to any extent, be invalid or
unenforceable, such invalidity or unenforceability will not in any manner affect
or render invalid or unenforceable the remainder of this Agreement, and the
application of that provision to other Persons or circumstances will not be
affected but, rather, will be enforced to the extent permitted by applicable
Law.

     

    10.    Entire Agreement;
Amendment.  This Agreement expresses the entire understanding
of the subject matter hereof; and all other understandings, written or oral, are
hereby merged herein and superseded.  No amendment of or supplement to
this Agreement, or waiver or modification of, or consent under, the terms hereof
will be effective unless in writing and signed by the Party to be bound
thereby.

     

    11.    Term of
Agreement.  Subject to Section 2(c) and
Section 2(d),
this Agreement and all guarantees, covenants and agreements of the Guarantor
contained herein will continue in full force and effect and will not be
discharged until all of the Guaranteed Obligations have terminated, expired or
been indefeasibly paid or otherwise performed and discharged in
full.

     

    12.    Survival of Representations
and Warranties.  All representations and warranties contained
herein or made in writing or on behalf of the Guarantor in connection herewith
will survive the execution and delivery of this Agreement.

     

    13.    Governing Law; Waiver of
Jury Trial.  THIS AGREEMENT WILL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS WITHOUT REGARD
TO ANY CONFLICT OF LAW PRINCIPLES THAT MIGHT PERMIT OR REQUIRE THE APPLICATION
OF THE LAWS OF ANOTHER JURISDICTION.  THE VENUE AND JURISDICTION WILL
LIE IN HOUSTON, HARRIS COUNTY, TEXAS.  EACH PARTY IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY
AND ALL RIGHTS TO TRIAL BY JURY IN CONNECTION 

     

     

     

     

    
      
        Exhibit
C to Partnership Agreement - Page 21

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    WITH ANY LITIGATION ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.

     

    14.    Attorneys’
Fees.  In the event of any litigation or other proceedings to
enforce this Agreement, the prevailing party will be entitled to recover all
reasonable attorneys’ fees and expenses incurred in connection
therewith.

     

    15.    Assignment.  Guarantor
shall not assign or pledge any of its rights, duties, and obligations that are
set forth under this Agreement without the prior written consent of TOPS and any
purported assignment or pledge in violation of this Section shall be null and
void; provided, that notwithstanding any such assignment by Guarantor, Guarantor
will remain primarily obligated under this Agreement and will not be released
from any of its obligations hereunder.

     

    16.    No Third-Party
Beneficiaries.  This Agreement is intended for the exclusive
benefit of TOPS, Enterprise and TEPPCO, and no other Person shall have any
rights hereunder, whether as a third-party beneficiary or
otherwise.

     

    


     

    ********

     

     

     

     

    
      
        
          Exhibit
C to Partnership Agreement - Page 22

           


        

        
           


          
            

          

        

        
           


        

      

    

    


    IN
WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed and
delivered as of the date and year first written in the Preamble.

    
       

      
        
          
            	 	OILTANKING
      HOLDING AMERICAS, INC
	 	 
	 	 
	 	By:       /s/ Carlin G.
      Conner                                                      
      
	 	    Carlin G.
      Conner
	 	    Special
      Agent
	 	    
	 	 
	 	ENTERPRISE OFFSHORE PORT
      SYSTEM,  LLC
	 	 
	 	 
	 	By:       /s/ James
      Guion                                                             
	 	    James
      Guion
	 	    Vice
      President
	 	 
	 	 
	 	TEPPCO O/S PORT SYSTEM,
      LLC
	 	 
	 	 
	 	By:       /s/ John N.
      Goodpasture                                              
	 	    John N.
      Goodpasture
	 	    Vice
      President
	 	 
	 	 
	 	TEXAS OFFSHORE PORT
      SYSTEM
	 	 
	 	 
	 	By:       /s/ Carlin G.
      Conner                                                       
	 	    Carlin G.
      Conner
	 	    Chairman


          

           

           

           

          

            
              
                Exhibit
C to Partnership Agreement - Page 23

                 


              

              
                 


                
                  

                

              

              
                 


              

            

          

           

        

      

    

    
      OILTANKING
FREEPORT, L.P.

      15631
JACINTOPORT BOULEVARD

      HOUSTON,
TEXAS 77015

      


      August
14, 2008

      TEPPCO
O/S Port System, LLC

      1100
Louisiana, Suite 1600

      Houston,
Texas 77002

      


      Enterprise
Offshore Port System, LLC

      1100
Louisiana, Suite 1000

      Houston,
Texas 77002

       

      RE:           Texas
Offshore Port System

       

      Gentlemen:

       

      On this day, Oiltanking Freeport, L.P.
(“Oiltanking”), TEPPCO O/S Port System, LLC (“TEPPCO”), and Enterprise Offshore
Port System, LLC (“Enterprise”) executed the Partnership Agreement of Texas
Offshore Port System (the “Partnership Agreement”).  All terms
capitalized herein and not otherwise defined herein shall have the meanings
ascribed to them in the Partnership Agreement.

       

      Pursuant to Section 4.6 of the
Partnership Agreement, at the time of its execution each Partner was required to
cause its respective Affiliate Guarantor to issue a guaranty of such Partner’s
obligation to contribute Capital Contributions. Each of the Partners has caused
its Affiliate to execute and deliver an appropriate guaranty, save and except
that Oiltanking did not deliver the Specific and Limited Guaranty Agreement from
its parent, Oiltanking GmbH.  Oiltanking has advised the TOPS
Partnership, Enterprise and TEPPCO that it requires additional time to deliver
the Oiltanking GmbH guaranty because the delivery of such guaranty requires (i)
the approval of Oiltanking GmbH’s Supervisory Board and (ii) the approval of
Oiltanking GmbH’s bankers.  Oiltanking anticipates that its parent,
Oiltanking GmbH, will be able to deliver the Oiltanking GmbH guaranty on or
before September 30, 2008.

       

      By this letter agreement, TEPPCO,
Enterprise, the TOPS Partnership and Oiltanking hereby agree that:

       

      1.           Oiltanking
shall use its best efforts to cause the Oiltanking GmbH guaranty in the form
attached hereto as Exhibit A to be delivered to the TOPS Partnership on or
before September 30, 2008 (hereinafter [as same may be extended] the
“Deadline”);

       

      2.           Oiltanking
shall not be considered to be in breach of the Partnership Agreement due to its
inability to deliver the Oiltanking GmbH guaranty prior to the Deadline;
and

       

      3.           In
the event that Oiltanking fails to deliver the Oiltanking GmbH guaranty to the
TOPS Partnership on or before the Deadline, then Enterprise and TEPPCO may
either, at their respective sole option and in their respective sole discretion,
(i) extend the Deadline during which period Oiltanking shall continue to use its
best efforts to diligently pursue delivery of the Oiltanking GmbH guaranty or
(ii) as their sole and exclusive remedy, and notwithstanding anything to the
contrary in the Partnership Agreement, require Oiltanking to withdraw from
the

       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 24

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Partnership,
at which time the TOPS Partnership shall refund all of Oiltanking’s Capital
Contributions.  Following the refund of such Capital Contributions,
Oiltanking’s partnership interest shall be deemed to be redeemed and the
remaining Partners and the TOPS Partnership shall thereafter have no rights,
duties or obligations to Oiltanking under the Partnership Agreement, and
Oiltanking shall thereafter have no rights, duties or obligations to the
remaining Partners or to the TOPS Partnership under the Partnership
Agreement.  Oiltanking hereby  waives and releases (and
shall cause its Affiliate Oiltanking Houston L.P. to waive and release) all
rights that it and its affiliates may have against the remaining Partners and
their affiliates under the Term Sheet for Texas Offshore Oil Port Project dated
April 16, 2007, executed in anticipation of the Partnership
Agreement.

       

      If this letter correctly sets forth the
terms of our agreement, please so indicate by signing the attached copy and
returning it to Oiltanking.

       

      


      Very
truly yours,

      


      OILTANKING
FREEPORT, L.P.

      


      By:           OTF
GP, LLC

      Its General Partner

      


      


      By:      /s/ Carlin G. Conner   
          

           Carlin G.
Conner, President

      


      Agreed to
and accepted

      this
14th
day of August 2008:

      


      TEPPCO
O/S PORT SYSTEM, LLC

      


      


      By:      /s/ John N. Goodpasture   
    

      John N.
Goodpasture

      Vice
President

      


      ENTERPRISE
OFFSHORE PORT SYSTEM, LLC

      


      


      By:      /s/ James
Guion                   


      James
Guion

      Vice
President

       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 25

           


        

        
           


          
            

          

        

        
           


        

      


      EXHIBIT
A

      


      TOPS
PARTNER SPECIFIC AND LIMITED GUARANTY AGREEMENT

      (by
Oiltanking GmbH)

       

      This
Specific and Limited Guaranty Agreement (this “Agreement”) dated as
of [_________], 2008, is made by and among Oiltanking GmbH, a German limited
liability company (the “Guarantor”),
Enterprise Offshore Port System, LLC, a Texas limited liability company (“Enterprise”), TEPPCO
O/S Port System, LLC, a Texas limited liability company (“TEPPCO”) and Texas
Offshore Port System, a Delaware general partnership (“TOPS”, with
Enterprise, TEPPCO and the Guarantor, each a “Party” and together, the “Parties”).

       

      INTRODUCTION

       

      A.           Contemporaneously
herewith, Enterprise, TEPPCO and Oiltanking Freeport L.P., a Texas limited
partnership (“OFLP”), are entering
into that certain Partnership Agreement of TOPS, dated the same date as this
Agreement (including the exhibits, annexes and schedules thereto, and as
amended, restated, supplemented and otherwise modified from time to time, the
“Partnership
Agreement”).

       

      B.           Contemporaneously
herewith, Enterprise, TEPPCO, Oiltanking Holding Americas, Inc., a Delaware
corporation (“Obligor”), and TOPS
are entering into that certain TOPS Partner Performance Guaranty Agreement dated
the same date as this Agreement (the “Guaranty
Agreement”).

       

      C.           Obligor
is the wholly-owned direct subsidiary of Guarantor and OFLP is the wholly-owned
indirect subsidiary of the Guarantor.

       

      D.           It
is the intention of the Parties that TOPS will be the direct beneficiary of this
Agreement.

       

      E.           The
Guarantor acknowledges that it will indirectly benefit from Obligor being the
owner of OFLP and of OFLP being a party to the Partnership
Agreement.

       

      F.           Enterprise,
TEPPCO and TOPS desire that the Guarantor guarantee Obligor’s performance under
the Guaranty Agreement upon the terms and conditions set forth
herein.

       

      AGREEMENT

       

      For and
in consideration of the premises and mutual covenants herein contained and other
good and valuable consideration (the receipt and sufficiency of which is hereby
acknowledged), the Parties do hereby stipulate and agree as
follows:

       

      1.    Defined
Terms.  Capitalized terms used herein but not defined will have
the meaning given them in the Partnership Agreement.

       

      2.    The
Guaranty.

       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 26

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (a)    Subject
to Section
2(b), Section
2(c) and Section 2(d), the
Guarantor hereby irrevocably and unconditionally guarantees to TOPS the full and
timely performance and discharge by Obligor of all payment obligations of
Obligor now existing or hereafter arising under the Guaranty Agreement (the
“Guaranteed
Obligations”), and agrees that if Obligor fails to pay any amount when
and as the same becomes due and payable by Obligor to TOPS under the Guaranty
Agreement, the Guarantor will, within ten (10) days from and after the
effectiveness of notice of such failure from TOPS or any Partner, forthwith
perform and discharge any such payment obligation to TOPS as is required to be
made or done by Obligor pursuant to the terms of the Guaranty
Agreement.  Subject to Section 2(b), Section 2(c) and
Section 2(d),
the guaranty in the preceding sentence is an absolute, present and continuing
guaranty of performance of obligations (including the payment of money) and not
of collectability and is in no way conditional or contingent upon any attempt to
collect from Obligor or upon any other action, occurrence or circumstance
whatsoever.  Subject to Section 2(b), Section 2(c) and
Section 2(d),
including the appropriate resolution of any applicable “Capital Call Disputes”
as provided under Section 4.1(f) of the Partnership Agreement, it will not be
necessary for TOPS or any Partner, in order to enforce such performance by the
Guarantor, first to institute suit or exhaust its remedies against Obligor, any
other guarantor, or any other Person liable with respect to the Guaranteed
Obligations.

       

      (b)    Notwithstanding
anything to the contrary contained in this Section 2 or
elsewhere in this Agreement, Enterprise, TEPPCO and TOPS each separately
acknowledge and agree that the Guarantor will have the benefit of and the right
to assert any defenses against the claims of TOPS which are available to Obligor
or OFLP and which would have also been available to the Guarantor if the
Guarantor had been in the same contractual position as OFLP under the
Partnership Agreement, including the appropriate resolution of any applicable
“Capital Call Dispute” as provided under Section 4.1(f) of the Partnership
Agreement, other than defenses arising from the bankruptcy or insolvency of
Obligor or OFLP.

       

      (c)    This
guaranty is limited in amount.  Notwithstanding anything to the
contrary contained in this Section 2 or
elsewhere in this Agreement, Enterprise, TEPPCO and TOPS each separately
acknowledge and agree that the Guarantor’s obligations under this Agreement,
inclusive of all attorneys’ fees, expenses and other sums due hereunder, shall
not exceed the difference between (i) US $700 million and (ii) any and all
sums paid by Obligor under the Guaranty Agreement.

       

      (d)    Notwithstanding
anything to the contrary contained in this Section 2 or
elsewhere in this Agreement, Enterprise, TEPPCO and TOPS each separately
acknowledge and agree that the Guarantor’s obligations under this Agreement
shall terminate and be of no further force or effect upon the payment of 100% of
all amounts for costs and expenses incurred on behalf of TOPS related to the
formation of TOPS and of all amounts to be incurred by TOPS to design,
construct, install and place in service the Initial Facilities as necessary to
timely and satisfactorily fulfill all of TOPS’s obligations under the Throughput
Agreements.

       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 27

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      3.    Obligations
Absolute.  Subject to Section 2(b), Section 2(c) and
Section 2(d),
the obligations of the Guarantor hereunder will be absolute, continuing and
unconditional and will not be released, discharged or in any way affected, by
any of the following:

       

      (a)    any
amendment, modification of or supplement to the Guaranty Agreement or the
Partnership Agreement or any other instrument referred to therein or any
assignment or transfer of any rights or obligations thereunder;

       

      (b)    any
extension of the time for the payment of all or any portion of any sums payable
under the Guaranty Agreement or the Partnership Agreement or the extension of
time for the performance of any obligations under the Guaranty Agreement or the
Partnership Agreement;

       

      (c)    any
failure, omission, delay or lack of diligence on the part of TOPS to enforce,
assert or exercise, or any waiver of, any right, privilege, power or remedy
conferred on TOPS by the Guaranty Agreement or the Partnership Agreement, or any
action on the part of TOPS granting indulgence or extension of any
kind;

       

      (d)    any
bankruptcy, insolvency, readjustment, composition, liquidation, dissolution or
similar proceeding or any other defense that may arise in connection with any
such proceeding with respect to Obligor, OFLP, the Guarantor or any other
Person;

       

      (e)    any
change in the corporate or partnership structure, existence or ownership of the
Guarantor, Obligor, OFLP or TOPS (including the termination or liquidation of
any such Person) or any sale, lease or transfer of any or all of the assets of
the Guarantor, Obligor, OFLP or TOPS to any Person;

       

      (f)    any
failure on the part of Obligor or OFLP for any reason to comply with or perform
any of the terms of any other agreement with the Guarantor; or

       

      (g)    any
applicable Law hereafter in effect in any jurisdiction affecting any of the
rights under or terms of the Guaranty Agreement or the Partnership Agreement
except to the extent any such Law renders Guarantor’s actions hereunder either
unenforceable or illegal.

       

      4.    Waiver.  The
Guarantor unconditionally waives, to the fullest extent permitted by applicable
Law: (a) except as required under Sections 1.1 (under the definition of
“Default”), 4.1(c) and 4.1(d) of the Partnership Agreement (which notices TOPS
expressly agrees to deliver to Guarantor pursuant to Section 7 hereof),
notice of acceptance hereof, of any action taken or omitted in reliance hereon,
of demand, of any defaults by Obligor in the payment or performance of the
Guaranty Agreement, or of any defaults by OFLP in the payment or performance of
the Guaranteed Obligations, and of any of the matters referred to in Section 3 hereof; (b)
all notices that may otherwise be required by applicable Law or otherwise to
preserve any of the rights of TOPS against the Guarantor, including presentment
to or demand for payment from Obligor, OFLP or the Guarantor, notice to Obligor
or OFLP of claims with a court in the event of the bankruptcy of Obligor or
OFLP, as the case may be; and  (c) any requirement of diligence on the
part of TOPS.

       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 28

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      5.    Reinstatement of
Guaranty.  This Agreement will continue to be effective, or be
reinstated, as the case may be, if and to the extent at any time any payment, in
whole or in part, made by Obligor, OFLP or the Guarantor to TOPS in respect of
the Guaranty Agreement or the Guaranteed Obligations is rescinded or must
otherwise be restored or returned by TOPS upon the insolvency, bankruptcy,
dissolution, liquidation or reorganization of Obligor or OFLP, as the case may
be, or upon or as a result of the appointment of a custodian, receiver, trustee
or other officer with similar powers with respect to Obligor or OFLP or any
substantial part of their respective property, or otherwise, all as though such
payments had not been made and, to the extent permitted by applicable law, in
such event the Guarantor will pay TOPS an amount equal to the payment that has
been rescinded or returned.  TOPS will not be required to litigate or
otherwise dispute its obligation to make such repayments if it in good faith
believes that such obligation exists.

       

      6.    Representations, Covenants
and Warranties of Guarantor.  The Guarantor represents,
covenants and warrants as follows as of the date hereof:

       

      (a)    Organization, Good Standing and
Location.  The Guarantor is a Gesellschaft mit beschränkter
Haftung (GmbH) with limited liability duly organized, validly existing
and in good standing under the laws of Germany.  The Guarantor has all
requisite power and authority, and all governmental licenses and permits, to own
and operate its properties and to carry on its businesses as presently
conducted, except where the failure to do so could not reasonably be expected to
have a material adverse effect on the business of the Guarantor and its
Subsidiaries taken as a whole.  The Guarantor has the requisite power
to enter into and perform its obligations under this Agreement.

       

      (b)    Approval and Enforceability of
Agreement.  The execution, delivery and performance of this
Agreement have been duly authorized by all necessary action on the part of the
Guarantor. This Agreement has been duly and validly executed and delivered and
constitutes the legal, valid and binding obligation of the Guarantor,
enforceable against it in accordance with its terms, subject to (i) applicable
bankruptcy, insolvency, moratorium, reorganization, dissolution, receivership
and similar laws affecting the rights and remedies of creditors generally, and
(ii) general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law). Except for such notice,
filings, authorizations, consents, or approvals as have been given, made, or
obtained, respectively, the Guarantor is not required to give any notice to,
make any filings with, or obtain any authorization, consent or approval of, any
Governmental Authority or any other Person to perform its obligations under this
Agreement.  Neither the execution and the delivery of this Agreement
by the Guarantor, nor the performance by the Guarantor of its obligations
hereunder, will in any material respect violate any statute, regulation, rule,
injunction, judgment, order, decree or ruling of any Governmental Authority to
which the Guarantor is subject, or any provision of its charter or bylaws or any
material agreement or instrument to which the Guarantor is a party.

       

      7.    Notices.  Unless
otherwise specifically provided herein, all notices, consents, directions,
approvals, instructions, requests and other communications required or permitted
by the terms hereof will be in writing and addressed in the following
manner:

       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 29

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (a)    If to the
Guarantor, to:

       

      Oiltanking
GmbH

      Attn:  Jan
Vogel

      Admiralitaetstrasse
55

      Hamburg,
Germany

      D20459

      Telephone:  011
49 40 370 04 990

      Fax:  011
49 40 370 99 499

      


      (b)    If to
Enterprise, to:

       

      Enterprise
Offshore Port System, LLC

      Attn:  Executive
Vice President

      1100
Louisiana Street, Suite 1000

      Houston,
Texas  77002

      Telephone:  (713)
381-3939

      Fax:  (713)
381-4039

      


      (c)    If to
TEPPCO, to:

       

      TEPPCO
O/S Port System, LLC

      Attn:  General
Counsel

      1100
Louisiana Street

      Suite  1600

      Houston,
Texas  77002

      Telephone:  (713)
381-3939

      Fax:  (713)
381-4039

      


      (d)    If to
TOPS, to:

       

      Texas
Offshore Port System

      Attn:
Chairman

      15631
Jacintoport Blvd.

      Houston,
Texas 77015

      Phone:  281-457-7900

      Facsimile:  281-457-7991

       

      provided, however, that any such
addressee may change its address for communications by notice given as aforesaid
to the other Parties.  Each such notice, demand or other communication
will be effective, if given by registered or certified mail, return receipt
requested, as of the third Day after the date indicated on the mailing
certificate, or if given by any other means, when delivered at the address
specified in this Section 7.

       

      8.    Construction.  Whenever
the context requires: the gender of all words used in this Agreement includes
the masculine, feminine, and neuter; a reference to any person or entity
includes its permitted successors and assigns; the words “hereof,” “herein,”
“hereto,” “hereunder,” and words of similar import when used in this Agreement
will refer to this

       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 30

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Agreement
as a whole and not to any particular provisions of this Agreement; articles and
other titles or headings are for convenience only and neither limit nor amplify
the provisions of the Agreement itself, and all references herein to articles,
sections or subdivisions thereof will refer to the corresponding article,
section or subdivision thereof of this Agreement unless specific reference is
made to such articles, sections or subdivisions of another document or
instrument; any reference to “includes” or “including” will mean “includes
without limitation” or “including, but not limited to,” respectively; and any
references in the singular will include references in the plural and
vice-versa.

       

      9.    Severability.  If
any provision of this Agreement, or the application thereof to any Person or
circumstances, shall, for any reason or to any extent, be invalid or
unenforceable, such invalidity or unenforceability will not in any manner affect
or render invalid or unenforceable the remainder of this Agreement, and the
application of that provision to other Persons or circumstances will not be
affected but, rather, will be enforced to the extent permitted by applicable
Law.

       

      10.    Entire Agreement;
Amendment.  This Agreement expresses the entire understanding
of the subject matter hereof; and all other understandings, written or oral, are
hereby merged herein and superseded.  No amendment of or supplement to
this Agreement, or waiver or modification of, or consent under, the terms hereof
will be effective unless in writing and signed by the Party to be bound
thereby.

       

      11.    Term of
Agreement.  Subject to Section 2(c) and
Section 2(d),
this Agreement and all guarantees, covenants and agreements of the Guarantor
contained herein will continue in full force and effect and will not be
discharged until all of the Guaranteed Obligations have terminated, expired or
been indefeasibly paid or otherwise performed and discharged in
full.

       

      12.    Survival of Representations
and Warranties.  All representations and warranties contained
herein or made in writing or on behalf of the Guarantor in connection herewith
will survive the execution and delivery of this Agreement.

       

      13.    Governing
Law.  THIS
AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF TEXAS WITHOUT REGARD TO ANY CONFLICT OF LAW PRINCIPLES THAT MIGHT
PERMIT OR REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION.

       

      14.    Dispute
Resolution

       

      (a)    Arbitration.  Any
Dispute shall be exclusively and definitively resolved through final and binding
arbitration, it being the intention of the Parties that this is a broad form
arbitration agreement designed to encompass all possible
disputes.  “Dispute” means any dispute, controversy or claim (of any
and every kind or type, whether based on contract, tort, statute, regulation, or
otherwise) arising out of, relating to or connected with this Agreement,
including any dispute as to the construction, validity, interpretation,
termination, enforceability or breadth of the Agreement, as well as any dispute
over arbitrability or jurisdiction.

       

      (b)    Rules;
Administration.  The arbitration shall be conducted in
accordance with the International Arbitration Rules of the American Arbitration
Association

       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 31

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       (“AAA”) (as then in
effect) and administered by the International Center for Dispute
Resolution.

       

      (c)    Number of
Arbitrators.  The arbitral tribunal shall consist of three (3)
arbitrators, who shall endeavor to complete the final hearing in the arbitration
within six (6) Months after the appointment of the last arbitrator.

       

      (d)    Method of Appointment of the
Arbitrators.  If there are only two (2) parties to the Dispute,
then each party to the Dispute shall appoint one (1) arbitrator within thirty
(30) Days of the filing of the arbitration, and the two arbitrators so appointed
shall select the presiding arbitrator within thirty (30) Days after the latter
of the two arbitrators has been appointed by the parties to the
Dispute.  If a party to the Dispute fails to appoint its
Party-appointed arbitrator within the applicable time period or if the two
Party-appointed arbitrators cannot reach an agreement on the presiding
arbitrator within the applicable time period, then the AAA shall serve as the
appointing authority and shall appoint the remainder of the three arbitrators
not yet appointed.  If the arbitration is to be conducted by three
arbitrators and there are more than two parties to the Dispute, then within
thirty (30) Days of the filing of the arbitration, all claimants shall jointly
appoint one arbitrator and all respondents shall jointly appoint one arbitrator,
and the two arbitrators so appointed shall select the presiding arbitrator
within thirty (30) Days after the latter of the two arbitrators has been
appointed by the parties to the Dispute.  For the purposes of
appointing arbitrators under this Section 14(d), (i) Guarantor, and all Persons
whose interest in this Agreement derives from Guarantor (including the Obligor
or OFLP, if such parties agree to become parties to the arbitration) shall be
considered as one Party; and (ii) the Beneficiaries and all Persons whose
interest in this Agreement derives from Beneficiaries shall be considered as one
Party.  If either all claimants or all respondents fail to make a
joint appointment of an arbitrator within the applicable time period, or if the
Party-appointed arbitrators cannot reach an agreement on the presiding
arbitrator within the applicable time period, then the AAA shall serve as the
appointing authority and shall appoint the remainder of the three
arbitrators.

       

      (e)    Place of
Arbitration.  Unless otherwise agreed in writing by all parties
to the Dispute, the place of arbitration shall be Houston, Texas.

       

      (f)    Language.  The
arbitration proceedings shall be conducted in the English language, and the
arbitrators shall be fluent in the English language.

       

      (g)    Entry of
Judgment.  The award of the arbitral tribunal shall be final
and binding.  Judgment on the award of the arbitral tribunal may be
entered and enforced by any court of competent jurisdiction.

       

      (h)    Notice.  All
notices required for any arbitration proceeding shall be deemed properly
given if given in accordance with ‎Section 7.

       

      (i)    Qualifications and Conduct of the
Arbitrators.  All arbitrators shall be and remain at all times
wholly impartial, and, once appointed, no arbitrator shall have any ex parte
communications with any of the parties to the Dispute concerning the arbitration
or 

       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 32

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      the
underlying Dispute other than communications directly concerning the selection
of the presiding arbitrator, where applicable.

       

      (j)    Equitable
Remedies.  Notwithstanding anything to the contrary in this
Section 14, any Party to the Dispute may apply to a court in Harris County,
Texas for interim measures (i) prior to the constitution of the arbitral
tribunal (and thereafter as necessary to enforce the arbitral tribunal’s
rulings); or (ii) in the absence of the jurisdiction of the arbitral tribunal to
rule on interim measures in a given jurisdiction.  Any Party may apply
to such court for equitable relief available under this
Agreement.  The Parties agree that seeking, obtaining or contesting
such interim measures or equitable relief shall not waive the right to
arbitration.  The arbitrators (or in an emergency the presiding
arbitrator acting alone in the event one or more of the other arbitrators is
unable to be involved in a timely fashion) may grant interim measures including
injunctions, attachments, specific performance and conservation orders in
appropriate circumstances, which measures may be immediately enforced by court
order.  Hearings on requests for interim measures may be held in
person, by telephone, by video conference or by other means that permit the
parties to the Dispute to present evidence and arguments.

       

      (k)    Costs and Attorneys’
Fees.  The arbitral tribunal is authorized to award costs of
the arbitration in its award, including: (i) the fees and expenses of the
arbitrators; (ii) the costs of assistance required by the tribunal, including
its experts; (iii) the fees and expenses of the administrator; (iv) the
reasonable costs for legal representation of a successful Party; and (v) any
such costs incurred in connection with an application for interim or emergency
relief and to allocate those costs between the parties to the
Dispute.  The costs of the arbitration proceedings, including
attorneys’ fees, shall be borne in the manner determined by the arbitral
tribunal.

       

      (l)    Interest.  The
award shall include pre-award and post-award interest, as determined by the
arbitral award, from the date of any default or other breach of this Agreement
until the arbitral award is paid in full.  Interest shall accrue at
the Default Interest Rate compounded Monthly.

       

      (m)    Currency of
Award.  The arbitral award shall be made and payable in United
States Dollars.

       

      (n)    Waiver of Challenge to Decision or
Award.  To the extent permitted by  Law, the Parties
hereby waive any right to appeal from or challenge any arbitral decision or
award, or to oppose enforcement of any such decision or award before a court or
any governmental authority, except with respect to the limited grounds for
modification or non-enforcement provided by any applicable arbitration statute
or treaty.

       

      (o)    Confidentiality.  Any
arbitration or expert determination relating to a Dispute (including a
settlement resulting from an arbitral award, documents exchanged or produced
during an arbitration proceeding, and memorials, briefs or other documents
prepared for the arbitration) shall be confidential and may not be disclosed by
the Parties, their employees, officers, directors, counsel, consultants, and
expert witnesses, except  to the extent necessary to enforce this
Section 14 or any arbitration award, to enforce other 

       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 33

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      rights of
a party to the Dispute, or as required by Law; provided however, that breach of
this confidentiality provision shall not void any settlement, expert
determination or award.

       

      15.    Assignment.  Guarantor
shall not assign or pledge any of its rights, duties, and obligations that are
set forth under this Agreement without the prior written consent of TOPS and any
purported assignment or pledge in violation of this Section shall be null and
void; provided, that notwithstanding any such assignment by Guarantor, Guarantor
will remain primarily obligated under this Agreement and will not be released
from any of its obligations hereunder.

       

      16.    No Third-Party
Beneficiaries.  This Agreement is intended for the exclusive
benefit of TOPS, Enterprise and TEPPCO, and no other Person shall have any
rights hereunder, whether as a third-party beneficiary or
otherwise.

       

      


      ********

       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 34

           


        

        
           


          
            

          

        

        
           


        

      


      IN
WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed and
delivered as of the date and year first written in the Preamble.

      
         

        
          
            
              	 	OILTANKING
      GmbH
	 	 
	 	 
	 	By:                                                                                                
      
	 	    Name:
	 	    Title:
	 	    
	 	 
	 	ENTERPRISE OFFSHORE PORT
      SYSTEM,  LLC
	 	 
	 	 
	 	By:                                                                                                
	 	    Name:
	 	    Title:
	 	 
	 	 
	 	TEPPCO O/S PORT SYSTEM,
      LLC
	 	 
	 	 
	 	By:                                                                                                
	 	    Name:
	 	    Title:
	 	 
	 	 
	 	TEXAS OFFSHORE PORT
      SYSTEM
	 	 
	 	 
	 	By:                                                                                                
	 	    Name:
	 	    Title:


            

          

        

      

       

       

       

       

      
        
          Exhibit
C to Partnership Agreement - Page 35