Exhibit 10.2


                        ASSET PURCHASE AND SALE AGREEMENT



                                     Between


                       KOCH PIPELINE COMPANY, L.P. ("KPL")

             KOCH FERTILIZER STORAGE AND TERMINAL COMPANY ("KFS&T")
                              (together, "Seller")


                                       and


             KANEB PIPE LINE OPERATING PARTNERSHIP, L.P., ("Buyer")

                            Date: September 17, 2002






<PAGE>
                               TABLE OF CONTENTS
<TABLE>
<CAPTION>

                                                                                                               Page

<S>                                                                                                              <C>
ARTICLE I - DEFINITIONS...........................................................................................1

   1.01        Definitions........................................................................................1
   ----

   1.02        Construction; Interpretation.......................................................................6
   ----

ARTICLE II - SALE OF ASSETS.......................................................................................7

   2.01        Purchase and Sale..................................................................................7
   ----

   2.02        Assets.............................................................................................7
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   2.03        Excluded Assets....................................................................................8
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   2.04        Assumption.........................................................................................9
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   2.05        Seller's Accounts Receivable, Accounts Payable and Settlement Thereof.............................10
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ARTICLE III - PURCHASE PRICE.....................................................................................10

   3.01        Purchase Price; Taxes.............................................................................10
   ----

   3.02        Adjustments to the Purchase Price.................................................................11
   ----                                   -

   3.03        Property Tax Proration............................................................................12
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   3.04        Allocation........................................................................................12
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ARTICLE IV - REPRESENTATION AND WARRANTIES BY SELLER.............................................................12

   4.01        Seller............................................................................................12
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ARTICLE V - REPRESENTATIONS AND WARRANTIES BY BUYER..............................................................21

   5.01        Buyer.............................................................................................21
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ARTICLE VI - TITLE...............................................................................................22

   6.01        Title to Real Property............................................................................22
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   6.02        Title (Assets other than the Real Property).......................................................22
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ARTICLE VII - COVENANTS..........................................................................................22

   7.01        Casualty Loss.....................................................................................22
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   7.02        Conduct of Business Prior to Closing..............................................................23
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   7.03        HSR Act...........................................................................................25
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   7.04        Compliance with Conditions Precedent..............................................................25
   ----                                  -

   7.05        Preparation of Preliminary Settlement Statement...................................................25
   ----                      -

   7.06        Press Release.....................................................................................25
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   7.07        Government Filings................................................................................25
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   7.08        Consents to Assignment............................................................................25
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   7.09        Tariffs...........................................................................................26
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   7.10        Notices under Articles IV, V and VII..............................................................26
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   7.11        Pipeline Repairs..................................................................................26
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   7.12        Cooperation.......................................................................................26
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ARTICLE VIII - POST-CLOSING AGREEMENTS...........................................................................27

   8.01         Final Recapitulation Settlement; Subsequent Audits and Settlements...............................27
   ----

   8.02        Recording.........................................................................................27
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   8.03        Records...........................................................................................27
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   8.04        Use of Seller's Name..............................................................................28
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   8.05        Non-Solicitation of Employees.....................................................................28
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   8.06        Post-Closing Covenants............................................................................28
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   8.07        Covenant Not to Sue...............................................................................28
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   8.08        Further Assurances................................................................................28
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ARTICLE IX - CLOSING.............................................................................................29

   9.01        Time and Place....................................................................................29
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   9.02        Conditions to Buyer's Obligations.................................................................30
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   9.03        Conditions to Seller's Obligations................................................................32
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ARTICLE X - DISCLAIMERS; INDEMNITIES.............................................................................33

   10.01       Disclaimers.......................................................................................33
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   10.02       Buyer's Indemnity.................................................................................35
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   10.03       Seller's Indemnity................................................................................36
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   10.04       Threshold and Monetary Cap........................................................................37
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   10.05       Survival..........................................................................................38
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   10.06       Sole and Exclusive Remedy.........................................................................38
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   10.07       Limitations.......................................................................................39
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   10.08       Indemnification Procedures........................................................................39
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ARTICLE XI - INSPECTION AND RECORDS; TITLE.......................................................................40

   11.01       Inspection........................................................................................40
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   11.02       Title Inspection..................................................................................40
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ARTICLE XII - TAXES..............................................................................................41

   12.01       Tax Proceedings...................................................................................41
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   12.02       Sales Taxes.......................................................................................41
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   12.03       Other Taxes.......................................................................................41
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ARTICLE XIII - EMPLOYEE MATTERS..................................................................................42

   13.01       Employees.........................................................................................42
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   13.02       Employee Benefit Plans............................................................................43
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   13.03       No Third Party Employee Beneficiary...............................................................44
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   13.04       Federal Worker Adjustment and Retraining Notification Act.........................................45
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ARTICLE XIV - MISCELLANEOUS PROVISIONS...........................................................................45

   14.01       Commission........................................................................................45
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   14.02       Assignment........................................................................................45
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   14.03       Entire Agreement; Amendments......................................................................45
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   14.04       Severability......................................................................................45
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   14.05       Actions...........................................................................................45
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   14.06       Termination.......................................................................................46
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   14.07       Counterparts......................................................................................46
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   14.08       Governing Law.....................................................................................46
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   14.09       Time of Essence...................................................................................46
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   14.10       Nondisclosure of Confidential Information.........................................................47
   -----                       -

   14.11       Assignment of ContractS and Property Rights.......................................................47
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   14.12       Notices and Addresses.............................................................................47
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</TABLE>
<TABLE>
<CAPTION>

                                     EXHIBITS AND SCHEDULES

<S>               <C>                                                           <C>
Exhibit           Description                                                   Section Reference
---------         -----------                                                   -----------------
    A             Facilities                                                            2.02(a)
    B             Real Property                                                         2.02(b)
    C             Leasehold Interests                                                   2.02(c)
    D             Property Rights                                                       2.02(d)
    E             Permits                                                               2.02(e)
    F             Contracts                                                             2.02(f)
    G             Intellectual Property                                                 2.02(g)
    H             Purchase Price Allocation                                             3.04
    I             Form of Assignment and Assumption Agreement                           9.01(a)
    J             Form of Bill of Sale                                                  9.01(a)
    K-1           Transition Services Agreement                                         9.01(a)
    K-2           Services Agreement (Long Term)                                        9.01(a)
    L             Form of Special Warranty Deed                                         9.01(a)
    M             Additional Excluded Assets                                            2.03(e)
    N             Technical Repair Criteria                                             7.11
    O             Form of Easement                                                      9.01(a)
    P             Post Closing Covenants                                                8.06
    Q             Form of Agreement for Anhydrous Ammonia
                  Storage and Throughput Service                                        9.01(a)
</TABLE>
<TABLE>
<CAPTION>

<S>               <C>                                                           <C>
  Schedule        Description                                                   Section Reference
  --------        -----------                                                   -----------------
   4.01(d)        Conduct of Business                                                   4.01(d)
   4.01(e)        Proceedings and Orders                                                4.01(e)
   4.01(g)        Known Environmental Matters,
                  Environmental Law Violations and Claims                               4.01(g)
   4.01(h)        Compliance with Laws                                                  4.01(h)
   4.01(j)        Violations                                                            4.01(j)
   4.01(m)        Legislative and Regulatory Changes                                    4.01(m)(v)
   4.01(o)(i)(A)  Exceptions to Employees                                               4.01(o)(i)
   4.01(o)(i)(B)  Notifications of Plans to Terminate Employment                        4.01(o)(i)
   4.01(o)(ii)      Employee Benefit Plans                                              4.01(o)(ii)
   4.01(p)        Contracts                                                             4.01(p)
   4.01(r)        Business Interruptions                                                4.01(r)
   4.01(s)        Permits                                                               4.01(s)
   4.01(t)        Deposits                                                              4.01(t)
   4.01(u)        Work Orders                                                           4.01(u)
   4.01(v)        Customer List                                                         4.01(v)
   4.01(w)        Royalties                                                             4.01(w)
  13.01           Employees                                                            13.01(a)

</TABLE>


<PAGE>

                        ASSET PURCHASE AND SALE AGREEMENT

     THIS ASSET PURCHASE AND SALE AGREEMENT  ("Agreement")  is entered into this
17th day of September,  2002, by and among:  A. Koch Pipeline  Company,  L.P., a
Delaware limited partnership,  with its principal place of business at 4111 East
37th Street North, Wichita, Kansas 67220 ("KPL"); B. Koch Fertilizer Storage and
Terminal Company, a Nebraska  corporation,  with its principal place of business
at 4111 East 37th Street North,  Wichita,  Kansas 67220 ("KFS&T");  and C. Kaneb
Pipe Line Operating Partnership,  L.P., a Delaware limited partnership, with its
principal  place of  business  at 2435  North  Central  Expressway,  Suite  700,
Richardson, Texas 75080 ("Buyer").

     KPL and KFS&T are hereinafter  collectively referred to as "Seller." Seller
and  Buyer  are  hereinafter  collectively  referred  to as the  "Parties",  and
individually as a "Party."

     WHEREAS, Seller owns the anhydrous ammonia pipeline system described herein
and  certain  other  related  assets,  facilities  and  contracts  (collectively
referred to as the "Assets," as defined in Section 2.02); and

     WHEREAS,  pursuant to the terms of this  Agreement,  Seller desires to sell
and Buyer desires to purchase the Assets.

     NOW,  THEREFORE,  for and in  consideration  of the premises and the mutual
covenants contained herein, the Parties agree as follows:

                             ARTICLE I: DEFINITIONS

1.01 Definitions.  As used  herein,  the  following  terms have the meanings set
     forth below:

          "Accounting Firm" has the meaning given it in Section 8.01(b).

          "Affiliate"  means  with  respect  to any  Person,  any  other  Person
     directly or indirectly controlling,  controlled by, or under common control
     with such Person.  For purposes of the definition of "Affiliate,"  the term
     "control"  (including the correlative  terms "controlled by" and "under the
     common  control  of"),  as used  with  respect  to any  Person,  means  the
     possession,  directly  or  indirectly,  of the power to direct or cause the
     direction  of the  management  and  policies  of such  Person,  through the
     ownership of voting securities, by contract, or otherwise.

          "Agreement" means this Asset Purchase and Sale Agreement.

          "Asset" and "Assets" have the meanings given them in Section 2.02.

          "Business"  means the  business  currently  being  conducted by Seller
     using the Assets.

          "Business  Day"  means  any  day,  Monday  through  Friday,  on  which
     nationally  chartered banks are open for the transaction of business in New
     York, New York.

          "Buyer" has the meaning given it in the Preamble.

          "Buyer Indemnitees" means Buyer, its parent companies,  Affiliates and
     subsidiaries,   and  their   respective   partners,   members,   directors,
     shareholders, officers, employees, agents, representatives, contractors and
     subcontractors.

          "Casualty Loss" has the meaning given it in Section 7.01.

          "Closing" has the meaning given it in Section 9.01.

          "Closing Amount" has the meaning given it in Section 7.05.

          "Closing Date" means the date on which Closing occurs.

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

          "Confidentiality   Agreement"   means  that  certain   confidentiality
     agreement  dated March 12,  2002 by and among  Kaneb Pipe Line  Company and
     KPL,  KFS&T and Koch  Nitrogen  Company,  which to the extent  Confidential
     Information  relating to the Assets  purchased  and sold  hereunder  or the
     Business  was  disclosed  pursuant to the  Confidentiality  Agreement,  the
     obligations of Buyer  thereunder  shall  automatically  terminate as of the
     Closing; provided, however, to the extent Confidential Information relating
     to assets not purchased and sold hereunder was or is disclosed  pursuant to
     the Confidentiality  Agreement,  then the  Confidentiality  Agreement shall
     remain in full force and effect according to its terms.

          "Contracts" has the meaning given it in Section 2.02(f).

          "Drop Dead Date" has the meaning given it in Section 14.06(a)(ii).

          "Effective Time" has the meaning given it in Section 9.01.

          "Employees" has the meaning given it in Section 13.01(a).

          "Employment Sites" has the meaning given it in Section 4.01(o)(vii).

          "Environmental Condition" means soil and water contamination, or other
     types of  Releases  of  Hazardous  Materials  or  environmental  damage  or
     contamination  in,  on,  around or under the  Assets  or  arising  from the
     Assets,  including  offsite  disposal  thereof  and any of  which  requires
     Remediation under applicable Environmental Laws.

          "Environmental  Laws" means any and all Legal  Requirements or Orders,
     rules, codes, policies,  directives,  standards, licenses or permits of any
     Governmental Body relating to the environment, specifically including those
     relating  to the  exposure  to, or the use,  Release,  emission,  presence,
     storage, treatment, generation, transportation,  processing or handling of,
     Hazardous Materials, in effect as of the Effective Time, including the Safe
     Drinking  Water Act, 42  U.S.C.ss.300f  et seq.;  the Federal  Insecticide,
     Fungicide & Rodenticide  Act, 7 U.S.C.ss.136 et seq.; the Toxic  Substances
     Control Act, 15 U.S.C.ss.  2601 et seq.;  the Oil Pollution Act of 1990, 33
     U.S.C.ss.  2701 et seq.; the Clean Water Act, 33 U.S.C.ss.1251 et seq.; the
     Clean Air Act, 42  U.S.C.ss.7401  et seq.;  the Resource  Conservation  and
     Recovery Act, 42  U.S.C.ss.6901  et seq.; the  Comprehensive  Environmental
     Response,  Compensation  and Liability Act, 42 U.S.C.ss.  9601 et seq., and
     the Emergency Planning and Community Right to Know Act, 42 U.S.C.ss.  11001
     et seq., and all similar statutes adopted by the States in which the Assets
     are located and in effect as of the Effective Time.

          "Environmental   Liabilities"  means   Liabilities/Claims   (including
     Remediation costs and legal costs associated therewith) incurred or imposed
     (a) as  the  result  of an  Environmental  Condition,  (b)  pursuant  to an
     agreement,  Order, notice of responsibility or directive arising out of, or
     in connection with, or under Environmental Laws, or (c) pursuant to a claim
     by a  Governmental  Body or other  Person  for  personal  injury,  property
     damage,   damage  to   natural   resources,   Remediation   or  payment  or
     reimbursement  or response costs incurred or expended by such  Governmental
     Body or Person  pursuant to common law or statute and related to the use or
     Release of Hazardous Materials.

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

          "Excluded Assets" has the meaning given it in Section 2.03.

          "Facilities" has the meaning given it in Section 2.02(a).

          "Final Recap" has the meaning given it in Section 8.01(a).

          "Final Recap Statement" has the meaning given it in Section 8.01(a).

          "Governmental Body" means any (a) nation,  state,  county, city, town,
     village,  district,  territory,  or other  jurisdiction of any nature;  (b)
     federal,  state,  local,  municipal,  foreign,  or  other  government;  (c)
     governmental  authority of any nature  (including any governmental  agency,
     branch,  department,  official, or entity and any court or other tribunal);
     or (d) body  exercising,  or  entitled  to  exercise,  any  administrative,
     executive, judicial,  legislative,  police, regulatory, or taxing authority
     or power of any nature, including any arbitrator or arbitration panel.

          "Hazardous   Material"   means  any  "hazardous   waste",   "hazardous
     substance",  "extremely hazardous substance", "toxic chemical",  "hazardous
     chemical",  "toxic  pollutants",   "contaminants",   "chemical",  "chemical
     substance",  or  "asbestos",  as  such  terms  are  defined  in  any of the
     Environmental  Laws,  or related  substances,  and  petroleum and petroleum
     products,  all in such  quantities  or  concentrations  as are regulated by
     Environmental Laws.

          "Hired  Employees"  means those  Employees  accepting  employment with
     Buyer effective as of the Effective Date.

          "HSR Act" means the  Hart-Scott-Rodino  Antitrust  Improvements Act of
     1976, as amended.

          "Indemnify" means to indemnify, defend and hold harmless.

          "Indemnitee" has the meaning given it in Section 10.08.

          "Indemnitor" has the meaning given it in Section 10.08.

          "Intellectual Property" has the meaning given it in Section 2.02(g).

          "Intermittent Services Agreements" has the meaning given it in Section
     4.01(p)(iv).

          "Known by Seller" or  "Seller's  Knowledge"  means the current  actual
     knowledge of the  following  employees of Seller  applicable to the Assets:
     Patrick  McCann,   Michael  Purkey,  Ron  Simmons,   Royce  Hoemann,  Scott
     Christensen and Gary Koegeboehn, of such fact or circumstance,  without any
     specific or  additional  duty to review  documents  or records or interview
     other  persons to gain any new actual  knowledge  or to refresh a memory of
     past knowledge.

          "Known Environmental Condition" means an Environmental Condition which
     occurred  prior to the Effective  Time,  and which is Known by Seller at or
     prior to Closing, each of which are listed on Schedule 4.01(g).

          "KPL" has the meaning given it in the Preamble.

          "KFS&T" has the meaning given it in the Preamble.

          "Leasehold Interests" has the meaning given it in Section 2.02(c).

          "Legal  Requirement" means any Order,  constitution,  law,  ordinance,
     regulation,  statute,  or treaty  issued by any  Governmental  Body, or any
     principle of common law or governmental interpretation thereof.

          "Liabilities/Claims"  means all liabilities,  claims,  losses,  strict
     liability  claims,   including  those  arising  under  Environmental  Laws,
     demands, lawsuits,  judgments, Orders, fines, penalties,  damages, punitive
     damages,  expenses,  including reasonable attorneys' and consultants' fees,
     costs,  environmental  assessment costs,  Remediation  costs, and causes of
     action asserted by any Person.

          "Monetary Cap" has the meaning given it in Section 10.04.

          "Negligence/Fault"   means  negligence,   gross   negligence,   strict
     liability  and  any  other  type or form  of  negligence  recognized  under
     applicable law, and willful misconduct.

          "Net  Inventory"  means  the  anhydrous  ammonia  owned by  Seller  as
     linefill or stored by Seller in terminals that are connected to, related to
     or used in connection with the Facilities, including any pipeline retention
     allowances and long and short  positions with respect  thereto for calendar
     year 2002.

          "New Contracts" has the meaning given it in Section 9.02(j).

          "Notice" means written notice provided pursuant to Section 14.12.

          "Order"  means any  award,  decision,  injunction,  judgment,  decree,
     order, ruling,  subpoena, or verdict entered,  issued, made, or rendered by
     any court, administrative agency, or other Governmental Body.

          "Party" and "Parties" have the meanings given them in the Preamble.

          "Permits" has the meaning given it in Section 2.02(e).

          "Person" means any individual,  corporation  (including any non-profit
     corporation),  general or limited  partnership,  limited liability company,
     joint  venture,  estate,  trust,  unincorporated  organization,   business,
     syndicate, sole proprietorship,  association, organization, labor union, or
     other entity or Governmental Body.

          "Plans" has the meaning given it in Section 4.01(o)(ii).

          "Preliminary Settlement Statement" has the meaning given it in Section
     7.05.

          "Proceeding" means any action, arbitration,  audit, claim, inspection,
     notice, review, hearing, investigation, litigation, or suit (whether civil,
     criminal, administrative, investigative, or informal), at law or in equity,
     commenced,  brought,  conducted,  or  heard  by  or  before,  or  otherwise
     involving, any Governmental Body.

          "Property Rights" has the meaning given it in Section 2.02(d).

          "Purchase Price" has the meaning given it in Section 3.01(a).

          "Real Property" has the meaning given it in Section 2.02(b).

          "Records" has the meaning given it in Section 2.02(i).

          "Reference  Balance  Sheet Date" has the  meaning  given it in Section
     4.01(f)(iii).

          "Release" or "Released" means any spilling, leaking, pumping, pouring,
     emitting, emptying,  discharging,  injecting,  escaping, leaching, dumping,
     migrating or disposing  (including the abandoning or discarding of barrels,
     containers and other closed receptacles  containing any Hazardous Material)
     of a Hazardous Material into the environment.

          "Remediation" means containment,  remediation,  clean-up, restoration,
     removal or monitoring.

          "Seller" has the meaning given it in the Preamble.

          "Seller  Indemnitees" means Seller,  its parent companies,  Affiliates
     and  subsidiaries,  and  their  respective  partners,  members,  directors,
     shareholders, officers, employees, agents, representatives, contractors and
     subcontractors.

          "Seller's  Accounts  Payable"  means any debt or trade payable owed by
     Seller  arising in the ordinary  course of business  from sales or services
     rendered  to Seller  prior to the  Effective  Time in  connection  with the
     Business.

          "Seller's  Accounts  Receivable" means any debt or trade payable owing
     to Seller arising in the ordinary course of business from sales or services
     rendered  by Seller  prior to the  Effective  Time in  connection  with the
     Business.

          "Seller's  Existing Field Authority  Limitations"  means $100,000 with
     respect to capital  expenditures;  and  $150,000  with  respect to expensed
     expenditures.

          "Smart  Pig  Inspection"   means  the  internal   (in-line)   pipeline
     inspection by use of instrumented inspection tool.

          "Tax" or "Taxes" means any income, excise, franchise, profits, capital
     gains, capital stock, transfer, sales, use, occupation,  property, payroll,
     withholding or other taxes or charges, assessments,  duties, levies or fees
     of any kind imposed or collected  by any  Governmental  Body or pursuant to
     any  Legal  Requirement,  including  any  penalties,  interest,  deficiency
     assessments, additions to taxes or other charges with respect thereto.

          "Threshold Amount" has the meaning given it in Section 10.04.

          "Title Defect" means any  encumbrance,  encroachment,  irregularity or
     defect in or objection to title to the Real Property,  Leasehold Interests,
     Permits or Property Rights.

          "Unknown  Environmental  Condition" means an  Environmental  Condition
     which  occurred  prior to the  Effective  Time,  but  which is not Known by
     Seller at or prior to Closing.

          "WARN Act" means the Worker Adjustment Retraining  Notification Act of
     1988, as amended.

     1.02  Construction;   Interpretation.  Unless  the  context  shall  require
otherwise:  (i) words  importing  the  singular  number or plural  number  shall
include the plural number and singular number respectively; (ii) words importing
the  masculine  gender shall  include the  feminine and neuter  genders and vice
versa; (iii) reference to "include", "includes", and "including" shall be deemed
to be followed by the phrase  "without  limitation;"  (iv)  reference to "to the
extent" shall be deemed to be followed by the phrase ", but only to the extent;"
(v) reference in this Agreement to "herein",  "hereby",  or "hereunder",  or any
similar  formulation,  shall be  deemed to refer to this  Agreement  as a whole,
including the Exhibits and Schedules referenced herein and attached hereto; (vi)
the headings of this Agreement are for reference only and shall not be deemed to
form part of the text or be used in the construction or  interpretation  of this
Agreement;  and (vii) all  references  to "Section" or  "Sections"  refer to the
corresponding  Section or Sections of this  Agreement.  This  Agreement has been
mutually drafted, negotiated and prepared at the mutual request and direction of
the Parties,  at arm's length,  with the advice and participation of counsel. If
there is any  ambiguity,  this Agreement  shall not be construed  against either
Party.

                           ARTICLE II: SALE OF ASSETS

     2.01  Purchase  and  Sale.  Subject  to the terms  and  conditions  of this
Agreement,  Buyer  agrees to  purchase  from  Seller and Seller  agrees to sell,
transfer, assign and convey the Assets to Buyer at the Closing,  effective as of
the Effective Time.

     2.02 Assets.  Unless  otherwise  excluded in this  Agreement,  the "Assets"
shall consist of the following and shall hereafter collectively,  in whole or in
part, be referred to as the "Assets" or individually as the "Asset":

          (a) Pipelines,  Pipeline Assets and Other Fixtures.  All right,  title
     and interest in and to Seller's  Hermann,  Missouri  terminal and in and to
     those certain pipelines,  and related valves, pumps,  compressors and other
     equipment,  vehicles,  buildings,  building contents, personal property and
     fixtures relating  primarily to Seller's anhydrous ammonia pipeline systems
     (except for the Excluded Assets),  including the items described in Exhibit
     A (the "Facilities"). To the extent any such property is leased, the leases
     related  thereto are  described  in Exhibit C, and Seller  shall assign its
     leasehold  interest to the extent  assignable and will not convey title. To
     the extent  title to any of the Assets is held by an  Affiliate  of Seller,
     Seller shall cause that Affiliate to transfer title directly to Buyer at no
     additional cost to Buyer;

          (b) Real Property. All right, title and interest in and to any parcels
     of real  property  owned by Seller or an  Affiliate  thereof upon which the
     Facilities are located,  together with the improvements  thereon (the "Real
     Property"), including the parcels described in Exhibit B;

          (c) Leasehold  Interests.  All right, title and interest of the lessee
     in and to leases of real  property  upon which the Assets are  situated and
     the rights  associated  therewith  relating to ongoing use,  operation  and
     maintenance  of the Assets (the  "Leasehold  Interests"),  all of which are
     more particularly described in Exhibit C;

          (d)  Property  Rights.  To the  extent  not  listed as a Permit  under
     Exhibit E, all right, title and interest of the beneficiary or right holder
     in and to  those  certain  easements,  rights-of-way,  servitudes,  permits
     and/or licenses,  railroad crossing rights,  and other rights to use of the
     surface and  subsurface and related  instruments  which are held for use in
     connection with the ownership, use, operation or maintenance of the Assets,
     including  those  items  listed in Exhibit D, and which  excludes  the Real
     Property, the Permits and the Leasehold Interests (the "Property Rights");

          (e)  Permits.  All right,  title and  interest of the  beneficiary  or
     permit  holder  in  and  to  any   environmental,   operational  and  other
     governmental permits,  licenses, Orders, franchises and related instruments
     or rights  relating to the  ownership or  operation  of the Assets,  all of
     which are listed in Exhibit E  ("Permits"),  but only to the extent legally
     assignable or  transferable  and  excluding  the Property  Rights listed in
     Exhibit D;

          (f)  Contracts.  Subject to the  provisions of Section  14.11,  all of
     Seller's  right,  title  and  interest  in and to any  and  all  contracts,
     warranties  and  other  agreements  relating  exclusively  to or which  are
     reasonably necessary for the use of the Assets ("Contracts"), including the
     Contracts listed in Exhibit F;

          (g)  Intellectual   Property.   All  intellectual  property  interests
     identified  on Exhibit G,  including all  Liabilities/Claims  against other
     Persons for infringement and other proprietary rights associated  therewith
     (the "Intellectual Property");

          (h)  Inventory.  The Net  Inventory.  Buyer  will be  responsible  for
     satisfying any pipeline  retention  allowances and long and short positions
     and obligations with any third Persons.

          (i) Records.  All books,  records and files of Seller  relating to the
     Assets (paper and electronic  format, if available),  excluding  accounting
     records,  but including  operating records,  technical manuals and warranty
     documents, customer lists and information, charts, maps, surveys, drawings,
     prints and any physical embodiment of the Intellectual Property relating to
     the Assets (the "Records");  provided,  however, that the Records shall not
     include  Seller's and Seller's  Affiliates'  (A) corporate and  partnership
     records (including any documents relating to the formation or governance of
     Seller or its Affiliates),  (B) information  related to previous offers for
     the Assets,  including  economic analyses of the Assets, (C) any records to
     the  extent  related  to the  Excluded  Assets,  and (D)  records  or other
     information  protected  by the  attorney-client  privilege  or that is work
     product of  Seller's  counsel or counsel  for  Seller's  partners  or their
     Affiliates,  it being agreed that communications seeking or providing legal
     advice by, between,  or among the following persons shall be and are hereby
     deemed   confidential   communications   subject  to  the   attorney-client
     privilege:  counsel for Seller,  or their  Affiliates,  and any employee or
     agent of Seller or their Affiliates.

     2.03 Excluded Assets. Except as specifically included within the definition
of the Assets or otherwise  provided for in this Agreement,  it is the intent of
the Parties  that no other  assets or  interests  held or owned by Seller or any
related  liabilities or obligations  shall be sold,  conveyed,  transferred,  or
assigned  to Buyer,  and  specifically,  the  sale,  conveyance,  transfer,  and
assignment hereunder shall not include the following (the "Excluded Assets"):

          (a) any cash and cash equivalents of Seller;

          (b) any logos,  emblems,  signs,  trademarks,  trade names, or service
     marks that are the property of Seller or its Affiliates; provided, however,
     that signs for  location,  warning,  notice,  or as  required  by law shall
     remain  in place  and  will be  modified  or  replaced  by Buyer to  remove
     Seller's  name,  logo,  or other  identifying  marks as provided in Section
     8.04;

          (c) all items of personal property owned or leased generally by Seller
     currently located at Seller's Wichita, Kansas facility or office, including
     vehicles,  office  equipment,   furniture,   computers,  copiers,  and  fax
     machines;

          (d) all  ammonia  terminals,  truck  loading  and  storage  facilities
     located at, on or adjacent to the Facilities unless  specifically listed on
     Exhibit A;

          (e)  all  items  of  personal  property  (including  vehicles,  office
     equipment,  furniture,  computers, copiers, and fax machines) located at or
     adjacent to the Facilities to the extent listed on Exhibit M;

          (f)  any  software  programs  and  licenses  for  software  which  are
     confidential  or  proprietary  to  Seller or its  Affiliates,  or cannot be
     transferred  without payment of a fee to another  Person,  owner or vendor;
     provided, however, that Seller shall use good faith efforts to assist Buyer
     in  arranging  for a copy  of  software  that is not  transferable  without
     payment of a fee or other right to use such  software,  provided Buyer pays
     any fee  charged  or  assessed  by the  vendor or owner  thereof  (or other
     Persons  holding  the  right  to  license  the use of such  software);  and
     provided  further,  that Buyer  shall have  access to all data which is not
     confidential or proprietary on Seller's or its operator's  systems relating
     to the Assets for conversion to or storage on Buyer's systems; and

          (g) any personal property,  software,  computers,  servers, peripheral
     computer hardware and communication devices used in, or in connection with,
     Seller's  pipeline  control center used to remotely monitor and control the
     anhydrous ammonia pipeline systems and to ensure the integrity thereof.

     2.04  Assumption.  As of the Effective Time,  Buyer shall assume all rights
and obligations arising after the Effective Time under the Leasehold  Interests,
Property  Rights,  Permits  and  Contracts  and agrees to  Indemnify  the Seller
Indemnitees  from  and  against  all  Liabilities/Claims   under  the  Leasehold
Interests,  Property Rights,  Permits and Contracts accruing after the Effective
Time; but only in each case if such  obligations and  Liabilities/Claims  do not
arise out of or relate to acts or omissions that occurred prior to the Effective
Time.


2.05 Seller's Accounts Receivable, Accounts Payable and Settlement Thereof.

     (a) Buyer hereby  acknowledges  that no sale or transfer of the proceeds of
Seller's Accounts  Receivable is made or contemplated by this Agreement and that
Seller is entitled to receive payment of all of Seller's Accounts Receivable out
of the payments received by Buyer on account thereof,  if any. The Parties shall
reasonably  cooperate  with each  other in  connection  with the  collection  of
Seller's Accounts Receivable.

     (b) Buyer is not assuming any of Seller's Accounts Payable. Seller shall be
responsible  for the  payment of  Seller's  Accounts  Payable.  Seller and Buyer
hereby  acknowledge that no transfer or assignment of Seller's  Accounts Payable
is  made  or  contemplated  by this  Agreement  and  that  Seller  shall  remain
responsible for all of Seller's Accounts Payable.

     (c)  Notwithstanding  the foregoing  provisions of Section 2.05, Seller and
Buyer will provide each other with a monthly schedule of  reimbursements  due to
or from  one  Party as a result  of the  other  Party  collecting  the  former's
accounts  receivable  or payment of  accounts  payable.  Reimbursements  will be
settled monthly  following Closing until both Parties agree that all significant
reimbursements have been settled.

                           ARTICLE III: PURCHASE PRICE

     3.01 Purchase Price; Taxes.


          (a)  Purchase  Price.  Subject  to the  terms and  conditions  of this
     Agreement, and in full payment for the Assets, Buyer shall pay to Seller at
     Closing,  by wire transfer as described in Section 9.01(b),  the sum of One
     Hundred Forty  Million U.S.  Dollars  ($140,000,000.00)  as such sum may be
     adjusted as described in Section 3.02 pursuant to the provisions of Section
     7.05 (the "Purchase Price").

          (b) Taxes.  Buyer shall pay all Taxes payable in  connection  with the
     consummation  of the  transactions  contemplated  by this Agreement and the
     sale,  conveyance and assignment of the Assets hereunder (other than income
     Taxes resulting  directly from such sale,  which shall be borne by Seller),
     including  sales and use Taxes;  gross receipts  Taxes and other  similarly
     imposed transaction Taxes; conveyances, transfer, and recording fees; motor
     vehicle  transfer and excise Taxes and  registration  fees; and real estate
     transfer Taxes and documentary stamp Taxes,  except for sales,  transfer or
     similar  Tax which may be payable  with  respect to the  anhydrous  ammonia
     owned by Seller as Net Inventory, for which Seller shall pay any applicable
     sales,  transfer or similar Tax.  Buyer further  agrees to prepare and file
     any necessary Tax returns in  connection  with the foregoing  Taxes (except
     for  sales,  transfer  or  similar  Tax  which  may be  payable  on the Net
     Inventory  referenced  in the  preceding  sentence) and fees to be borne by
     Buyer and to pay all filing and  recording  fees relating to the filing and
     recording  of any  instruments  delivered by Seller to convey the Assets to
     Buyer.

     3.02  Adjustments  to the  Purchase  Price.  The  Purchase  Price  shall be
adjusted at Closing as follows.

          (a) Upward Adjustments. The Purchase Price shall be adjusted upward by
     the following:


               (i) the amount of expenses, costs, Taxes, and charges incurred or
          paid by Seller that are  attributable to the ownership or operation of
          the Assets after the Effective  Time  including,  any prepaid lease or
          other pre-payments,  production,  excise,  severance,  gross receipts,
          federal and state income Tax,  franchise Tax and any other Taxes based
          upon or  measured  by the  ownership  of the Assets or the  receipt of
          proceeds therefrom, not deducted or netted from proceeds under Section
          3.02(b)(i) below;

               (ii)  except  for  payments  received  by Buyer  with  respect to
          Seller's  Accounts  Receivable,  which are covered by Section 2.05(a),
          the amount of all  income,  revenues  and  proceeds  received by Buyer
          attributable to the ownership and operation of the Assets prior to the
          Effective Time; and

               (iii) any other amount agreed upon by the Parties.

          (b)  Downward  Adjustments.  The  Purchase  Price  shall  be  adjusted
     downward by the following:

               (i) the amount of all income,  revenues and proceeds  received by
          Seller attributable to the ownership and operation of the Assets after
          the Effective Time;

               (ii) ad  valorem,  property,  and other  Taxes  allocated  to the
          Seller under Section 3.03;

               (iii) the  amount  attributable  to any  Casualty  Loss  prior to
          Closing under Section 7.01;

               (iv) the amount mutually agreed to and  attributable to any gaps,
          defects or encumbrances in Property  Rights,  Leasehold  Interests and
          Permits under Section 11.02(b);

               (v) any other amount agreed upon by the Parties; and

               (vi) An amount  equal to $342,500,  which is the mutually  agreed
          upon  approximation  of  one-half  of the costs  that Buyer and Seller
          expect  Buyer  will incur for the  construction  and  installation  of
          equipment  by  Buyer   necessary  to  monitor  and  control   pipeline
          movements, including remote terminal unit, Omni flow computer, control
          building,  electrical  panel and wiring,  satellite  dish,  indoor and
          outdoor unit,  and other  required  equipment at the locations  listed
          below in accordance  with the easements  granted in Exhibit O. Aurora,
          Nebraska  Crawfordsville,  Indiana Fort Madison,  Iowa Holstein,  Iowa
          Huntington,  Indiana  Iowa  Falls,  Iowa  Marshalltown,  Iowa  Trilla,
          Illinois Taft, Louisiana Walton, Indiana Washington,  Iowa Wood River,
          Illinois

               The Parties agree that this  downward  adjustment to the Purchase
          price shall be the sole and exclusive  consideration  due to Buyer for
          the matters addressed in this Section 3.02(b)(vi).

     3.03 Property Tax Proration.  Real estate, ad valorem and personal property
Taxes,  if any, for the calendar year in which Closing  occurs shall be prorated
to the Effective Time based upon the most recent  property Tax  assessments  and
most recent certified Tax rates.  Such Tax proration shall be settled at Closing
by a downward adjustment to the Purchase Price. Buyer will assume responsibility
for the  actual  payment  to the  applicable  Governmental  Body  of any  unpaid
property Taxes not yet due. Buyer shall  Indemnify the Seller  Indemnitees  from
and against any and all real estate,  ad valorem and personal  property Taxes to
be paid by Buyer in accordance with this Section 3.03.

     3.04  Allocation.  The Parties  agree that the  valuations  established  in
Exhibit H attached  hereto  reflect the fair  market  value of the Assets at the
time of  Closing.  The Parties  further  agree that the  Purchase  Price for the
Assets shall be  allocated  among those  Assets  conveyed to Buyer  hereunder in
accordance  with Section 1060 of the Internal  Revenue Code of 1986, as amended.
Seller  and Buyer  agree to  cooperate  in good faith in the  allocation  of the
Purchase Price and the completion and filing of the United States Federal Income
Tax Form 8594 in accordance with the price allocation. The Parties further agree
that they will report the Tax consequences of the purchase and sale hereunder in
a manner  consistent with the valuations  established in Exhibit H and that they
will not take any positions inconsistent therewith in connection with the filing
of any Tax return.

              ARTICLE IV: REPRESENTATIONS AND WARRANTIES BY SELLER

     4.01 Seller. Seller represents and warrants to Buyer as of the date of this
Agreement that:

          (a) Organization and Standing.  KPL is a limited partnership and KFS&T
     is a  corporation,  each  duly  organized,  validly  existing  and in  good
     standing   under  the  laws  of  the  States  of  Delaware   and   Nebraska
     respectively,  and both are duly  authorized,  qualified and licensed under
     all applicable  Legal  Requirements  to carry on the Business in the places
     and in the manner now conducted.

          (b) Authority. Seller has the full legal right, power and authority to
     enter into,  execute,  deliver and perform this  Agreement and to carry out
     the  transactions  contemplated  herein to be  performed  or carried out by
     Seller.  The  execution  and  delivery of this  Agreement by Seller and the
     consummation  of the  transactions  contemplated  hereby have been duly and
     validly  authorized and approved by all requisite  partnership or corporate
     action on the part of Seller.

          (c)  Enforceability.  This Agreement  constitutes the legal, valid and
     binding  obligation of Seller,  enforceable  in accordance  with its terms,
     except as that enforceability may be (i) limited by applicable  bankruptcy,
     insolvency,  reorganization,  moratorium  or  similar  laws  affecting  the
     enforcement  of  creditors'  rights  generally  and (ii) subject to general
     principles  of  equity  (regardless  of  whether  such   enforceability  is
     considered in a Proceeding in equity or at law).

          (d) Conduct of Business.  Except as set forth in Schedule 4.01(d),  to
     Seller's Knowledge, since January 1, 2000, the Assets have been operated in
     the ordinary course of business.

          (e) Proceedings and Orders.  Except as set forth in Schedule  4.01(e),
     (i) there are no Proceedings  pending before any Governmental  Body, and to
     Seller's Knowledge, there are no Proceedings threatened in writing, against
     Seller relating to the Business or any of the Assets, or which question the
     validity or  legality of the  transactions  contemplated  hereby;  and (ii)
     Seller  is not  subject  to  any  outstanding  Order  (other  than  general
     regulation  and  general   regulatory  Orders  that  are  not  specifically
     addressed to Seller but are applicable  generally to businesses of the type
     operated by Seller) that would  reasonably be anticipated to materially and
     adversely affect the Assets or the Business.

          (f) Financial Information. Seller has delivered to Buyer copies of the
     following financial data and information of the Business:

               (i) unaudited balance sheet as of December 31, 1999, December 31,
          2000 and December 31, 2001;

               (ii) unaudited  income  statement and statement of cash flows for
          calendar years 1999, 2000 and 2001; and

               (iii) unaudited balance sheet as of June 30, 2002 (the "Reference
          Balance Sheet Date") and year to date unaudited  income  statement and
          statement of cash flows for the period ending June 30, 2002.

     Such  financial  statements  delivered to Buyer are true and correct in all
     material respects and present fairly the financial  position and results of
     operations of the Business as of the  respective  dates thereof and for the
     fiscal periods then ended, in accordance with generally accepted accounting
     principles  consistently applied, except that the interim statements do not
     include normal,  recurring  year-end  adjustments or footnotes and the year
     end statements do not include footnotes.

          It is acknowledged by the Parties that Buyer may determine on or after
     the date hereof that certain laws and  regulations  applicable to Buyer may
     require  an  audit to be  performed  with  respect  to the  Assets  and the
     Business  for periods on or before the Closing  Date.  To the extent  Buyer
     makes such a  determination,  Seller  agrees to reasonably  cooperate  with
     Buyer in providing access to Seller's books, records, personnel and present
     auditors (and their work papers)  required to complete  such an audit.  The
     cost of any such audit will be at Buyer's  sole  expense,  and Buyer  shall
     reimburse  Seller  for  Seller's  reasonable   third-Person   out-of-pocket
     expenses  relating  to its  cooperation  as  described  in the  immediately
     preceding sentence.

          (g) Environmental Law Violations and Environmental  Claims.  Except as
     set forth in Schedule 4.01(g), to Seller's Knowledge:

               (i) there is no Environmental Condition relating to the Assets;

               (ii) Seller is in compliance  with all  applicable  Environmental
          Laws with respect to the Assets or the  operation  thereof,  including
          the  Records  and  accounting  records  required  to  comply  with the
          Environmental Laws;

               (iii) there are no underground storage tanks, as defined in Title
          40 of the Code of Federal Regulations,  located on or under any of the
          Assets;

               (iv)  there  are  no  obligations,  undertakings  or  liabilities
          arising out of or relating to Environmental  Laws or any Environmental
          Condition  that  Seller,  with  respect to the Assets,  has agreed to,
          assumed or retained, by contract or otherwise; and

               (v) Seller has provided Buyer access to all environmental audits,
          assessments or investigations of the Assets that are in the possession
          of Seller or are subject to its control.

          (h) Compliance.  Except as set forth in Schedule  4.01(h),  the Assets
     and Seller's ownership and operation of the Facilities, and its Records and
     accounting records maintained in connection with the Asset or the Business,
     are in  compliance in all material  respects  with all Legal  Requirements,
     excluding  the  compliance  with  Environmental  Laws and the  Records  and
     accounting  records  relating  thereto,  which are covered  exclusively  by
     Section 4.01(g).

          (i) [Reserved]

          (j) No  Violations.  Except  as set  forth in  Schedule  4.01(j),  the
     execution and delivery of this  Agreement and the  performance by Seller of
     its obligations hereunder will not:

               (i) violate or conflict  with any  provision of Seller's  limited
          partnership   agreements  or  corporate   governance   documents,   as
          applicable;

               (ii)  result  in the  breach  of any  term or  condition  of,  or
          terminate  or  constitute a default or cause the  acceleration  of any
          obligation  under,  any  agreement or  instrument to which Seller is a
          party or by which Seller or any of the Asset may be bound;

               (iii) to Seller's Knowledge, except as otherwise stated in either
          Schedule  4.01(g) or 4.01(h),  violate or conflict with any applicable
          Legal Requirement applicable to Seller or the Assets;

               (iv) cause  Buyer to lose the  benefit of any right or  privilege
          included in the Assets;

               (v) relieve any Person of any obligation (whether  contractual or
          otherwise)  or enable any Person to terminate  any such  obligation or
          any right or benefit  enjoyed by Seller or to exercise any right under
          any agreement with respect to the Assets;

               (vi) require notice to or the consent, authorization, approval or
          order of any Person; or

               (vii) to Seller's Knowledge,  materially and adversely affect the
          business  relationship  of clients,  customers  and  suppliers  of the
          Business.

          (k) Non-foreign Entity.  Seller is not a non-resident  alien,  foreign
     corporation,  foreign  partnership,  foreign  trust,  or foreign estate for
     purposes of U.S. income taxation.

          (l) Brokers.  Seller is not a party to or in any way  obligated  under
     any contract or other agreement for the payment of any broker's or finder's
     fee  in  connection  with  the  origination,   negotiation,   execution  or
     performance of this Agreement or the transactions contemplated hereby.

          (m) Events Since the Reference Balance Sheet Date. Since the Reference
     Balance Sheet Date, there has not been:

               (i) any change in the  condition  (financial  or otherwise) or in
          the  properties,  assets,  liabilities,  business or  prospects of the
          Business  of the  Seller,  except  normal  and  usual  changes  in the
          ordinary  course  of  business,  none of which has been  material  and
          adverse and all of which in the  aggregate  have not been material and
          adverse;

               (ii) any labor trouble, strike or any other occurrence,  event or
          condition  affecting  the  employees  of Seller  that  materially  and
          adversely affects the condition (financial or otherwise) of the Assets
          or the Business;

               (iii) any breach or default by Seller or, to Seller's  Knowledge,
          by any other party, under any agreement or obligation  included in the
          Assets or by which any of the Assets are bound;

               (iv) any damage,  destruction  or loss (whether or not covered by
          insurance)  materially  and  adversely  affecting  the  Assets  or the
          Business;

               (v)  except  as  set  forth  in  Schedule  4.01(m),  to  Seller's
          Knowledge,  any  legislative  or regulatory  change that is reasonably
          expected  to  materially  and  adversely  affect  the  Assets  or  the
          Business;

               (vi) any  transaction  related to or affecting  the Assets or the
          Business  other  than  transactions  in  the  ordinary  course  of the
          Business; or

               (vii)  any  other   occurrence,   event  or  condition  that  has
          materially  and  adversely  affected  (or is  reasonably  expected  to
          materially and adversely affect) the Assets or the Business.

          (n) Taxes and Tax Returns.  All Tax returns,  information  returns and
     statements,  forms and reports required by any  Governmental  Body or Legal
     Requirement  to be filed by  Seller,  or which  include  or should  include
     Seller,  including  those relating to Taxes to which Seller or the Business
     is  subject,  have been or will be properly  filed when due,  and all Taxes
     shown thereon to be due and payable have been or will be paid timely. There
     are no liens for Taxes upon any of the  Assets,  except for liens for Taxes
     not yet due and payable.

          (o) Employee Matters.

               (i) Seller's  Employees.  Except as otherwise  stated on Schedule
          4.01(o)(i)(A), Schedule 13.01 lists all of Seller's employees who work
          at the Assets on the date Seller executes this  Agreement,  along with
          such  individual's  title  and/or  job  description  and date of hire.
          Seller  has  separately  provided  Buyer with such  Employees  current
          annual salary, bonus(es) for the previous year and other compensation.
          Except as  otherwise  stated in  Schedule  4.01(o)(i)(B),  none of the
          Employees has provided Seller with  notification  that he/she plans to
          terminate  his/her  employment  during calendar year 2002,  whether by
          reason  of  the   transactions   contemplated  by  this  Agreement  or
          otherwise.

               (ii) Employee Benefits Plans.  Schedule  4.01(o)(ii) lists all of
          the employee  welfare  benefit and employee  pension  benefit plans as
          defined  in  sections  3(1) and 3(2) of ERISA,  including  plans  that
          provide  retirement  income  or  result  in a  deferral  of  income by
          Employees  for periods  extending  to  termination  of  employment  or
          beyond,  and plans that  provide  medical,  surgical or hospital  care
          benefits or benefits  for  sickness,  accident,  disability,  death or
          unemployment   and  all   other   employee   benefit   agreements   or
          arrangements,  including deferred compensation plans, incentive plans,
          bonus plans or arrangements,  stock option plans stock purchase plans,
          stock award plans, golden parachute  agreements,  severance pay plans,
          dependent care plans,  cafeteria plans,  employee assistance programs,
          scholarship programs,  contracts with any of the Employees,  retention
          incentive  agreements,  non-competition  agreements  with  any  of the
          Employees,   consulting   agreements   with  any  of  the   Employees,
          confidentiality  agreements  with  any  of  the  Employees,   vacation
          policies  and similar  plans,  agreements  and  arrangements  that are
          currently  in  effect  for  the  benefit  of the  Employees  or  their
          beneficiaries   (collectively,   the  "Plans").  Buyer  will  have  no
          liability  with  respect  to any  Plans  or  other  similar  plans  or
          arrangements   of  Seller  or  its  Affiliates  as  a  result  of  the
          transactions contemplated by this Agreement.

               (iii) Neither Seller nor any entity (whether or not incorporated)
          that was at any time during the six-year  period ending on the Closing
          Date  treated as a single  employer  together  with the  Seller  under
          section  414 of the Code has ever  maintained,  had an  obligation  to
          contribute to,  contributed to, or incurred any liability with respect
          to, a  pension  plan  that is or was  subject  to Title IV of ERISA of
          section 412 of the Code.

               (iv) Seller has complied with the group health plan  continuation
          of  coverage   requirements   of  the   Consolidated   Omnibus  Budget
          Reconciliation Act of 1985, as amended.

               (v) In connection  with the  Business,  there is no labor strike,
          work  stoppage,  lockout,  or other material labor dispute or slowdown
          pending,  or to  Seller's  Knowledge,  threatened  in writing  against
          Seller  and there has not been any such  action  during the last three
          (3)  year  period,  and  Seller  is not a  party  to or  bound  by any
          collective  bargaining  agreement or similar agreement or written work
          rules or practices with any labor organization or employee association
          covering the terms and  conditions  of  employment of any employee who
          works at any of the  Assets.  To  Seller's  Knowledge,  no Employee is
          represented  by any labor  organization  and, to  Seller's  Knowledge,
          there are no current union organizing activities among the Employees.

               (vi)  Other  than  wage  increases  in  the  ordinary  course  of
          business,  since December 31, 2001, Seller has not made any commitment
          or  agreement to increase  the wages of any  employment  of any of the
          Employees.

               (vii)  During the four (4) year period  immediately  prior to the
          date  hereof,  Seller has not  effectuated  (i) a "plant  closing" (as
          defined in the WARN Act)  affecting  any site of  employment of any of
          the facilities included in the Assets covered by this transaction (the
          "Employment  Sites");  or (ii) a "mass layoff" (as defined in the WARN
          Act)  affecting  any of the  Employment  Sites;  nor has  Seller  been
          affected  by any  transaction  or engaged  in  layoffs  or  employment
          terminations  sufficient  in  number  to  trigger  application  of any
          similar state or local law at any of the Employment Sites.

               (viii)  With  respect  to each  Employee  hired by  Seller  after
          November  6, 1986 that is not a citizen of the United  States,  Seller
          shall have required a copy of Form I-9 to be completed pursuant to the
          Immigration  Reform  and  Control  Act of  1986,  and  the  rules  and
          regulations promulgated thereunder,  and shall have retained a copy of
          such Form I-9 in its employee files.

          (p) Contracts and Agreements. Exhibit F sets forth a true and complete
     list of, briefly describes (including termination dates) and states whether
     or not consent to assign is required  with respect to, all of the following
     contracts, agreements, leases, licenses, plans, arrangements or commitments
     that  relate  to the  Assets or the  Business,  including  all  amendments,
     supplements  and  modifications  thereto (the  "Contracts"),  excluding any
     Property  Rights  or  Leasehold  Interests  which  are set  forth  in other
     Exhibits:

               (i)  all  contracts,   agreements,   leases,   licenses,   plans,
          arrangements or commitments, including those in respect of the sale of
          products  or services or the  purchase of raw  materials,  supplies or
          other products or utilities;

               (ii) all offers,  tenders or the like  outstanding and capable of
          being converted into an obligation of Seller by the passage of time or
          by an acceptance or other act of some other person or entity or both;

               (iii)  all  sales,   agency  or  distributorship   agreements  or
          franchises or legally  enforceable  commitments  or  obligations  with
          respect thereto;

               (iv) all  collective  bargaining  agreements,  union  agreements,
          employment  agreements,  consulting agreements or agreements providing
          for the services of an independent  contractor;  provided, that Seller
          has  advised  Buyer,  and Buyer  accordingly  agrees,  that Seller may
          terminate  service  agreements with  contractors who may work at or in
          connection  with  Assets  pursuant to  Seller's  "General  Contracts,"
          "Intermittent   Services   Agreements,"  or  similar  agreements  (the
          "Intermittent   Services   Agreements")  and  that  such  Intermittent
          Services  Agreements  are not  included  on  Exhibit F and will not be
          assigned to Buyer,  provided,  that,  Seller shall have provided Buyer
          with a list of those vendors and a short  description  of the services
          provided to the Business under the  Intermittent  Services  Agreements
          that will not be assigned to Buyer;

               (v)  compensation,  group  life  and  health  insurance  or other
          employee benefit plans, agreements, arrangements or commitments of any
          nature whatsoever,  whether or not legally binding, and all agreements
          with any present or former officer,  director,  manager or shareholder
          of Seller;

               (vi) all loan or credit agreements, indentures, guarantees (other
          than   endorsements   made  for   collection),   mortgages,   pledges,
          conditional  sales  or  other  title  retention  agreements,  and  all
          equipment financing obligations, lease and lease-purchase agreements;

               (vii) all leases and all other  contracts,  agreements or legally
          enforceable  commitments relating to or affecting real property or any
          interest therein;

               (viii) all  performance  bonds,  bid bonds,  surety bonds and the
          like, all contracts and bids covered by such bonds, and all letters of
          credit and guaranties;

               (ix) all consent decrees and other judgments,  decrees or orders,
          settlement   agreements   and   agreements   relating  to  competitive
          activities, requiring or prohibiting any future action;

               (x) all  contracts or agreements of any nature with any Affiliate
          of Seller;

               (xi)  all  contracts,   agreements,   leases,  licenses,   plans,
          arrangements  or commitments  entered into outside the ordinary course
          of the operation of the Business; and

               (xii) all other contracts,  agreements,  leases, licenses, plans,
          arrangements  or  commitments  that are  material to the Assets or the
          operation of the Business

     Except as set forth in  Schedule  4.01(p),  all such  Contracts  are valid,
     binding  and in full force and effect in  accordance  with their  terms and
     conditions.  Except  as set  forth in  Schedule  4.01(p),  Seller is not in
     default under any of the Contracts and, to the Seller's Knowledge, no other
     party to any Contract is in default  under such  Contracts and there are no
     conditions  which,  with the  passage  of time or giving of notice or both,
     would constitute such a default by Seller,  or, to Seller's  Knowledge,  by
     any other party to the Contracts, and the Contracts will not be breached by
     or  give  the  other  party a  right  of  termination  as a  result  of the
     transactions contemplated by this Agreement. True and correct copies of all
     of the Contracts, and all amendments, supplements and modifications thereto
     have been  delivered  to Buyer.  Except as noted on  Exhibit  F, all of the
     Contracts  may be assigned to Buyer  without the approval or consent of any
     Person.

          (q) Title to Assets.  Seller owns or has the right to use (pursuant to
     a valid lease or license  disclosed  herein) all of the Assets.  Except for
     the Real Property which is covered  exclusively in Section 6.01, Seller has
     good and  marketable  title to the Assets,  excluding  any assets  shown on
     Exhibits C or D as being leased by Seller or under a Property  Right,  free
     and clear of any liens or  encumbrances.  The Assets  include all  existing
     warranties and service  agreements with respect to any of the Assets to the
     extent the same are capable of being assigned to Buyer.  The Assets include
     all  easements,  rights of ingress and egress and  utilities  and  services
     necessary to conduct the Business as Seller currently  conducts it. None of
     the Real Property has been condemned or otherwise taken by any Governmental
     Body,  nor to  Seller's  Knowledge,  is any  such  condemnation  or  taking
     threatened in writing nor has Seller  received any written  notice that any
     is  planned.  Except  for the  Excluded  Assets,  the Assets are all of the
     assets and properties  Seller used in its operation of the Business  during
     the  twelve  (12)  month  period  immediately  preceding  the date  hereof;
     provided, that, in the case of leased or licensed assets or properties, the
     leases or licenses  covering such assets or properties  are included in the
     Assets.

          (r)  Except  as set  forth in  Schedule  4.01(r),  in the two (2) year
     period  immediately  preceding the date of this  Agreement,  there have not
     been any significant interruptions of the Business.

          (s) Permits.

               (i) Except as set forth in  Schedule  4.01(s),  the  Permits  set
          forth in  Exhibit  E are a true  and  complete  list of all  licenses,
          permits  and  similar  documents  necessary  for  the  conduct  of the
          Business as it has been  conducted  by Seller  during the  immediately
          preceding twelve (12) months (excluding any highway,  railroad or road
          permits,  which are included on Exhibit D) and a true and correct copy
          of all Permits have been  delivered  to Buyer.  Except as set forth in
          Schedule 4.01(s),  all of the Permits are validly issued to Seller and
          in its name and in full force and effect.  The Assets and the Business
          are operated substantially in compliance with the Permits.

               (ii) Except as set forth in Schedule  4.01(s),  no violations are
          or have  been  recorded  with  respect  to any of the  Permits  and no
          proceeding is pending or, to Seller's Knowledge, threatened in writing
          seeking the revocation or limitation of any of the Permits. Seller has
          no reason to believe that any of the Permits would not be  assignable,
          transferable or able to be re-issued to Buyer.  Except as set forth in
          Schedule 4.01(s), Seller has made all filings necessary to request the
          timely  renewal or issuance of all the Permits it uses in the Business
          prior to  Closing  for  Seller to own and  operate  the Assets and the
          Business as Seller  currently  operates  them.  Except as set forth in
          Schedule  4.01(s),  there  are  no  pending  requests  by  Seller  for
          abatement  of any Permit  requirements  relating  to the Assets or the
          Business.

          (t) Deposits. Except as set forth in Schedule 4.01(t), Seller does not
     now hold any deposits or  prepayments  by third Persons with respect to any
     of the Assets or the Business.

          (u) Work Orders.  Except as set forth in Schedules  4.01(u) or Exhibit
     F,  there are no  outstanding  work  orders or  contracts  relating  to any
     portion of the Assets  from or required  by any policy of  insurance,  fire
     department,  sanitation department,  health authority or other Governmental
     Body,  nor is there  any  matter  under  discussion  with such  Persons  or
     authorities relating to such work orders or contracts.

          (v) Customer  List.  Schedule  4.01(v) sets forth a true,  correct and
     complete  list of all customers of the Business to which Seller has sold or
     provided products or services during the two (2) years immediately prior to
     the date  hereof,  including an accurate  statement  of the gross  revenues
     received from each such customer  during the twelve month period ended June
     30, 2002. This list also indicates by special  designation all customers on
     the list that the  Business  has not sold or provided  products or services
     during the first six (6) months of calendar year 2002.

          (w) No Royalties.  Except as set forth in Schedule 4.01(w), no royalty
     or similar payment or amount is being paid or is owed by Seller, not is any
     such item accruing, with respect to the operation,  ownership or use of the
     Business or the Assets.

          (x) Inventory.  The Net Inventory, as well as any product inventory of
     product  located in the pipeline or any terminals  being  conveyed to Buyer
     hereunder,  is of the quality and quantity usable in the ordinary course of
     the  Business as it has been  conducted  by Seller  during the  immediately
     preceding twelve (12) month period.  As of Closing,  the Net Inventory will
     be not less than  seventy-four  thousand  (74,000) tons,  including the Net
     Inventory in the Hermann,  MO terminal.  None of the Net Inventory or other
     products  located  in the  Facilities  is owned by any  Persons  other than
     Seller.  All  product  received  or held by  Seller as  pipeline  retention
     allowances after December 31, 2001 is located in the Facilities,  or stored
     by Seller in  terminals  connected  to,  related to, or used in  connection
     with, the Facilities and is included in the Net Inventory.

     ARTICLE V: REPRESENTATIONS AND WARRANTIES BY BUYER

     5.01 Buyer.  Buyer represents and warrants to Seller as of the date of this
Agreement that:

          (a)  Organization  and Standing.  Buyer is a limited  partnership duly
     organized,  validly  existing  and in good  standing  under the laws of the
     State of Delaware,  and is, or will be as of the Closing,  duly authorized,
     qualified and licensed under all applicable Legal  Requirements to carry on
     the Business in the places and in the manner now conducted.

          (b) Authority.  Buyer has the full legal right, power and authority to
     enter into,  execute,  deliver and perform this  Agreement and to carry out
     the  transactions  contemplated  herein to be  performed  or carried out by
     Buyer.  The  execution  and  delivery  of this  Agreement  by Buyer and the
     consummation  of the  transactions  contemplated  hereby have been duly and
     validly authorized and approved by all requisite  partnership action on the
     part of Buyer.

          (c)  Enforceability.  This Agreement  constitutes the legal, valid and
     binding  obligation of Buyer,  enforceable  in  accordance  with its terms,
     except  as  that  enforceability  may  be  (i)  limited  by  an  applicable
     bankruptcy,   insolvency,   reorganization,   moratorium  or  similar  laws
     affecting the enforcement of creditors'  rights  generally and (ii) subject
     to general principles of equity (regardless of whether such  enforceability
     is considered in a Proceeding in equity or at law).

          (d) Legal Proceedings. (i) there are no Proceedings pending before any
     Governmental  Body,  and to  Buyer's  Knowledge,  there are no  Proceedings
     threatened in writing, against Buyer, or which Buyer reasonably anticipates
     becoming a party,  or which the  question  the  validity or legality of the
     transactions  contemplated  hereby;  and (ii)  Buyer is not  subject to any
     outstanding  Order (other than general  regulation  and general  regulatory
     Orders  that are not  specifically  addressed  to Buyer but are  applicable
     generally to businesses of the type operated by Buyer or the Business) that
     would  reasonably be anticipated to materially and adversely affect Buyer's
     ability to purchase, own and operate the Assets or the Business.

          (e) No Violations.  This  transaction will not (i) violate or conflict
     with any provision of Buyer's organizational  documents; (ii) result in the
     breach of any term or condition of, or terminate or constitute a default or
     cause the acceleration of any obligation under, any agreement or instrument
     to which  Buyer is a party  or is  otherwise  bound;  or (iii)  violate  or
     conflict with any Legal Requirement applicable to Buyer.

          (f) Non-foreign  Entity.  Buyer is not a non-resident  alien,  foreign
     corporation,  foreign  partnership,  foreign  trust,  or foreign estate for
     purposes of U.S. income taxation.

          (g) Brokers. Buyer is not a party to or in any way obligated under any
     contract or other agreement for the payment of any broker's or finder's fee
     in connection with the origination,  negotiation,  execution or performance
     of this Agreement or the transactions contemplated hereby.

                                ARTICLE VI: TITLE

     6.01 Title to Real  Property.  Title to the Real  Property will be conveyed
with a special warranty of title, pursuant to which Seller will warrant title to
the Real Property  against any and all  Liabilities/Claims  arising by, through,
and under Seller or any Affiliate of Seller, but not otherwise.

     6.02 Title  (Assets other than the Real  Property).  Except as set forth in
Sections 4.01(q) and 6.01, Seller makes no warranty with respect to title of the
Assets.

                             ARTICLE VII: COVENANTS

     7.01 Casualty Loss.  Prior to Closing,  if all or any portion of the Assets
have been or are damaged or destroyed by fire,  flood,  storm, or other casualty
of a similar  nature,  or shall be taken by  condemnation  or under the right of
eminent domain (all of which are herein called  "Casualty  Loss"),  Seller shall
bear the risk of such Casualty  Loss,  and the Purchase  Price shall be adjusted
downward as provided in Section  3.02(b)(iii)  by the cost to repair or replace,
as applicable, those damaged, lost or destroyed Assets unless Seller replaces or
repairs such at its cost prior to Closing in a manner  reasonably  acceptable to
Buyer. Any insurance  proceeds,  payments made under threat of condemnation,  or
condemnation  awards, shall be the sole property of Seller. The risk of Casualty
Loss  relating  to the  Assets  shall  pass to Buyer at  Closing.  All repair or
replacement costs shall be determined  jointly by the Parties or, if the Parties
disagree with respect thereto, at Seller's option,  Seller may repair or replace
such Assets at Seller's  cost,  except that should the Casualty Loss or Casualty
Losses have a Material Adverse Effect On The Assets When Taken As A Whole,  then
either Party may terminate this Agreement. The phrase "a Material Adverse Effect
On The Assets When Taken As A Whole" shall mean a Casualty Loss and/or  Casualty
Losses for which  either:  (i) the repair and/or  replacement  costs exceeds ten
percent (10%) of the Purchase Price; or (ii) the repair and replacement  thereof
requires more than ninety (90) days to complete.

     7.02 Conduct of Business Prior to Closing.

          (a) Prior to Closing, Seller shall:

               (i) afford to the  officers  and  authorized  representatives  of
          Buyer access to the books and records of Seller  related to the Assets
          and the  Business  and shall  furnish  Buyer with such  financial  and
          operating  data and other  information  regarding  the  Assets and the
          Business and as Buyer may from time to time reasonably request;

               (ii) conduct the Business in the ordinary course;

               (iii)  maintain the Assets in good working  order and  condition,
          ordinary wear and tear excepted;

               (iv) perform all its obligations under agreements  relating to or
          affecting the Assets or the Business;

               (v) keep in full force and effect its existing insurance coverage
          on the Assets;

               (vi)  use its  reasonable  commercial  efforts  to  maintain  and
          preserve the Business,  and retain its present  employees,  customers,
          suppliers and others having business relations with it;

               (vii) duly and timely file all reports or returns required by any
          Legal  Requirement to be filed with any Governmental  Body, and timely
          pay all Taxes levied or assessed upon it or its properties or upon any
          part thereof;

               (viii)  duly  observe  and  conform  to  all  Legal  Requirements
          relating  to the  Assets or its  properties  or to the  operation  and
          conduct of its business and all covenants,  terms and conditions  upon
          or under which any of its properties are held;

               (ix) duly and timely take all actions  necessary to carry out the
          transactions contemplated hereby; and

               (x) deliver to Buyer on or before the 20th day of each month true
          and correct  unaudited monthly balance sheets and statements of income
          for the  Business  for the  immediately  preceding  month,  with  such
          financial  statements  for  the  months  between  June  30,  2002  and
          execution of this Agreement,  to be delivered at the time of execution
          of this Agreement.

          (b)  Without  the  consent  of  Buyer  (which  consent  shall  not  be
     unreasonably  withheld,  delayed  or  conditioned),  and prior to  Closing,
     Seller shall not:

               (i)  incur   obligations   with  respect  to,  or  undertake  any
          transactions  relating to, the Assets other than  transactions  (A) in
          the normal,  usual,  and customary  manner,  (B) of a nature and in an
          amount consistent with prior practice,  and (C) in the ordinary course
          of business of owning and operating the Assets;

               (ii) encumber,  sell, or otherwise  dispose of any of the Assets,
          other than property which is replaced by equivalent property, or which
          is used,  consumed,  or  abandoned  in the  normal  operations  of the
          Business;

               (iii) enter into or assume any contract,  agreement,  obligation,
          lease, license or commitment related to the Business or the Assets (or
          of a type included in the Assets) other than in the ordinary course of
          business;

               (iv) except in the case of an  emergency  situation  or if Seller
          believes (after  consultation with Buyer) is required to comply with a
          Legal  Requirement,  enter  into  or  assume  (whether  or  not in the
          ordinary  course of business)  any  contract,  agreement,  obligation,
          lease,  license or  commitment  related to the  Business or the Assets
          which  would  reasonably  be  anticipated  to commit  the Buyer  after
          Closing to in excess of Seller's Existing Field Authority Limitations;
          provided,  that,  if Seller  enters into such a  contract,  agreement,
          obligation,  lease,  license or  commitment  in order to comply with a
          Legal Requirement,  if such arrangement would materially and adversely
          affect  Buyer's  ownership  or operation of the Assets or the Business
          after Closing,  Buyer shall have the right to terminate this Agreement
          pursuant to the provisions of Section 14.06;

               (v) enter into or assume any mortgage,  pledge,  conditional sale
          or other title retention agreement, lien, encumbrance or charge of any
          kind upon any of the  Assets,  or sell,  lease,  abandon or  otherwise
          dispose of any of the  Assets,  including  real  property,  machinery,
          equipment or other operating properties;

               (vi)  engage  in  any  activities  or  transactions   that  would
          reasonably be expected to materially  and adversely  affect the Assets
          or the Business; or

               (vii) increase the salary of any Employee  except in the ordinary
          course of business and then not in excess of five percent (5%) of such
          Employee's base salary;

          (c) Seller shall cooperate with Buyer and its  representatives  in the
     preparation  of any documents or other material that may be required by any
     Governmental  Body in  connection  with the Assets or the  Business  or the
     transactions contemplated hereby.

          (d) Upon Buyer providing Seller with reasonable  notice,  Seller shall
     afford to the officers and authorized  representatives  of Buyer reasonable
     access to the  premises,  facilities  and tangible  assets  included in the
     Assets  for  the  purpose  of  inspecting  such  premises,  facilities  and
     equipment in such manner as Buyer shall deem appropriate.

     7.03 HSR Act.  As required  by law,  and to the extent not  earlier  filed,
Seller and Buyer,  promptly,  but in no event later than three (3) Business Days
after the  execution of this  Agreement,  shall each file  notification  reports
under the HSR Act and the rules  thereunder in connection with the  transactions
contemplated by this Agreement, shall cooperate with each other in attempting to
secure early  termination of the applicable  waiting periods under such Act, and
upon the request of either the Federal  Trade  Commission  or the  Department of
Justice,  shall exercise their  respective  commercially  reasonable  efforts to
supply such agencies with any additional requested  information as expeditiously
as possible.  Each Party shall pay its own costs in preparing  such filing,  and
the filing fees will be shared equally by Buyer and Seller.

     7.04  Compliance  with  Conditions  Precedent.  Each  Party  shall  use its
commercially reasonable efforts to cause the conditions precedent to Closing set
forth in Sections 9.02 and 9.03,  applicable to such Party,  to be fulfilled and
satisfied as soon as practicable but in any event prior to Closing.

     7.05 Preparation of Preliminary  Settlement Statement.  No later than three
(3) days prior to the anticipated  Closing,  Seller shall prepare and deliver to
Buyer a statement of the  estimated  Purchase  Price  adjustments  to be made at
Closing as provided for in this Agreement  ("Preliminary  Settlement Statement")
showing the calculation of the Purchase Price, as adjusted  ("Closing  Amount").
The Parties agree that where actual numbers are not available,  the  Preliminary
Settlement  Statement will be based upon the previous  year's Tax renditions and
payments and from Seller's  prior-month's  Asset-related  financial  records and
will be reconciled when actual numbers are available.  If the Parties are unable
to resolve any disagreements  with respect thereto,  such disagreement  shall be
resolved in the same manner as set forth in Sections 8.01(a) and (b).

     7.06 Press  Release.  The Parties shall consult with each other with regard
to all publicity  and other  releases  issued at or prior to Closing  concerning
this Agreement and the transactions  contemplated  hereby and except as required
by Legal Requirements,  neither Party shall issue any publicity or other release
without the prior written consent of the other Party.

     7.07 Government Filings.  After Closing, Buyer shall promptly file with the
applicable  Governmental  Body all  filings  necessary  to change  Seller or its
operator  from the owner and/or  operator of the Assets to Buyer or its designee
and shall promptly  provide Seller with the copies of all such filings when made
and confirmation thereof when received.

     7.08 Consents to Assignment.  If the terms of any Property Right, Leasehold
Interest,  Permit or Contract require that consent or approval be obtained prior
to any assignment or partial assignment, upon execution of this Agreement and up
to Closing,  Seller shall exercise  reasonable  commercial efforts, at its cost,
and with the  cooperation of Buyer,  to obtain such consent or approval prior to
Closing.  Seller  shall send all initial  letters  requesting  such  consents or
approvals  to all such third  Persons.  If such  consents or  approvals  are not
obtained by Seller prior to Closing,  at Closing,  Seller shall provide a status
report of Seller's efforts to obtain such consents and approvals and Buyer shall
be responsible, at its cost, for seeking such consents and approvals, and Seller
shall use  reasonable  commercial  efforts  to assist  Buyer in  obtaining  such
consents or approvals,  and Buyer shall promptly  reimburse Seller for all costs
incurred  by Seller in  assisting  Buyer to obtain such  consents  or  approvals
following Closing;  provided that, Seller shall be responsible for obtaining, at
its cost,  any consents  required to assign or  otherwise  transfer any railroad
crossing  rights.  Seller  shall  provide  Buyer  with a list  of any  Leasehold
Interest,  Permit or Contract  that  requires  consent to assign and Buyer shall
provide a list of any Property Right that requires consent to assign.

     7.09  Tariffs.  By no later than three (3) Business  Days after the Closing
Date,  Buyer  shall  file with each  applicable  Governmental  Body all  filings
necessary  to adopt the tariffs in effect for the  Facilities  and to reflect in
the tariffs the change in ownership and  operatorship  of the Assets,  all to be
effective at the Effective Time.

     7.10 Notices under Articles IV, V and VII. If any of the representations or
warranties  of either  Seller or Buyer  hereunder  are  determined  by the Party
providing them to have been incorrect when made, or are determined by that Party
to be incorrect as of any date  subsequent to the date hereof,  or if any of the
covenants of Seller or Buyer  contained in this Agreement have not been complied
with timely,  then that Party shall  immediately  notify the other Party to such
effect,  provided  that such  notice  shall in no way limit the rights of either
Party  (i)  under  Section  14.06 to  terminate  this  Agreement  or  refuse  to
consummate the transactions contemplated hereby or (ii) to enforce any rights or
remedies it may have hereunder.

     7.11 Pipeline Repairs. In lieu of any indemnification  obligation set forth
in Article X, Seller,  at its sole cost,  expense and risk, will make reasonable
commercial  efforts  to make  all  pipeline  repairs  to the  anhydrous  ammonia
pipelines purchased and sold hereunder pursuant to the Technical Repair Criteria
set forth in Exhibit N as a result of a Smart Pig  Inspection for the first four
(4) pipe  segments of said line (Note:  A total of four (4) metal loss Smart Pig
Inspections have been completed as of August 1, 2002).  Seller shall conduct any
additional  Smart Pig  Inspection  runs of such  pipelines  between date of this
Agreement  and the Closing,  if any, in its  ordinary  course of business at its
sole cost,  expense and risk. If the fifth pipe segment Smart Pig Inspection run
(whether  conducted by Seller or Buyer and whether  conducted  prior to or after
Closing)  demonstrates  that repairs are  required  pursuant to the Criteria set
forth in Exhibit N, and if and to the extent such repairs are conducted prior to
Closing,  such repairs  shall be conducted  at Seller's  sole cost,  expense and
risk.  If any such repairs for the first four or the fifth Smart Pig  Inspection
run are  conducted  after  Closing,  they shall be conducted by Buyer at Buyer's
sole risk and Seller shall reimburse Buyer for its reasonable costs and expenses
therefor,  but only to the extent  such  repairs are  conducted  pursuant to the
Technical  Repair  Criteria,  and subject to the cost and expense  reimbursement
limitations,  set forth in Exhibit N. The cost of any Smart Pig Inspection  runs
after  the  fifth  overall  run and any  repairs  associated  with any Smart Pig
Inspections  after the fifth run  overall,  regardless  of when such repairs are
conducted, shall be at Buyer's sole risk, cost and expense.

     7.12  Cooperation.  Each of the Parties shall  cooperate with the other and
its  representatives  in the preparation of any documents or other material that
may be required by any  Governmental  Body in connection  with the Assets or the
Business or the transactions contemplated hereby.

                      ARTICLE VIII: POST-CLOSING AGREEMENTS

     8.01 Final  Recapitulation  Settlement;  Subsequent Audits and Settlements.
With respect to final recapitulation and audits:

          (a) Within ninety (90) days after the Closing, Seller shall provide to
     Buyer,  for Buyer's review and comment,  a proposed final  statement in the
     form of the Preliminary  Settlement Statement (the "Final Recap Statement")
     to account for all  adjustments to the Purchase Price known as of such date
     pursuant to Section 3.02 (the "Final  Recap").  Buyer shall have the right,
     within  thirty  (30) days after  receipt of the Final Recap  Statement,  to
     audit the Final Recap  Statement.  If Buyer  disagrees with the Final Recap
     Statement,  the Parties shall use their respective  commercially reasonable
     efforts  to reach  agreement  within  thirty  (30) days  following  Buyer's
     completion of its audit of the Final Recap Statement.

          (b) If the  Parties  are unable to  resolve  any  disagreements,  such
     disagreement  shall,  at the earliest  practicable  date,  be referred,  by
     either or both of the Parties, to a nationally  recognized  accounting firm
     mutually acceptable to the Parties (the "Accounting Firm"),  along with all
     audit reports,  work papers,  schedules,  and  calculations  related to the
     matter in dispute. Within twenty-five (25) days after such submission,  the
     Accounting  Firm shall issue a letter report  determining  the Final Recap,
     which  shall be final  and  binding.  Any fees  and  expenses  incurred  in
     resolving  disputes shall be borne by the Party incurring such,  except for
     the Accounting Firm, which shall be borne equally by Buyer and Seller.

          (c)  Payment of any  amounts  owed under the Final Recap is due within
     ten (10) days  after the date  Seller  and Buyer  agree on the Final  Recap
     Statement,  or within  ten (10) days after the  determination  of the Final
     Recap by the Accounting Firm, whichever is later.

     8.02 Recording.  Buyer shall be solely  responsible for promptly  recording
the  assignments  and any other  instruments  related to the  conveyance  of the
Assets,  and shall promptly furnish Seller with copies of all recordings and the
recording information. All recording and filing fees shall be paid by Buyer.

     8.03  Records.  Within  thirty (30) days  following  Closing,  Seller shall
permit Buyer to take possession of the designated original set of the Records in
Seller's possession except accounting records for transactions prior to Closing,
wherever located. With regards to such retained accounting records, Seller shall
make  available to Buyer such records for  inspection  and copying during normal
business  hours.  For a period of five (5) years  following the Closing Date (or
such  longer  period if  requested  by Seller due to a pending  Proceeding  or a
Proceeding  threatened  in  writing),  Buyer shall use  commercially  reasonable
efforts to retain and make such Records  which it takes  possession of available
to Seller for inspection and copying during normal business hours, together with
such  additional  Records of Buyer as may be  reasonably  requested by Seller in
order to pursue any claims,  obligations,  and disputes  relating to the Assets;
provided,  that,  at any time,  Buyer may provide  notice to Seller  pursuant to
Section  14.12 of Buyer's  willingness  to transfer to Seller  possession of any
Record,  and if Seller does not accept such  transfer  within sixty (60) days of
the receipt of such  notice,  then Buyer  shall be  relieved of its  obligations
under this  sentence with respect to such Record.  Prior to Seller  disposing of
Seller's  accounting  records for the Business,  Seller shall provide  notice to
Buyer  pursuant to Section  14.12 of Seller's  willingness  to transfer to Buyer
possession  of such  accounting  records,  and if  Buyer  does not  accept  such
transfer within sixty (60) days of the receipt of such notice, then Seller shall
be relieved of its obligations to retain such accounting record.

     8.04 Use of Seller's Name. By no later than ninety (90) days after Closing,
Buyer shall have removed or caused to have been removed the names and marks used
by Seller or its operator and all variations and  derivations  thereof and logos
relating  thereto from the Assets  (including  all  pipeline  markers) and Buyer
shall not thereafter make any use whatsoever of those names, marks and logos. If
Buyer has not  completed  such removal  within  ninety (90) days after  Closing,
Seller shall have the right, but not the obligation, to complete such removal or
cause such  removal to be  completed  and Buyer shall  reimburse  Seller for any
costs or expenses incurred by Seller in connection therewith and shall Indemnify
the Seller Indemnitees from and against any and all Liabilities/Claims caused by
or arising from Buyer's failure to do so.

     8.05  Non-Solicitation of Employees.  Buyer covenants and agrees on its own
behalf and on behalf of its successors,  permitted  assigns and on behalf of any
other  Person to whom Buyer may sell or  otherwise  convey all or any portion of
the  Assets,  that it will not  solicit to hire any of the  Employees  listed in
Schedule  4.01(o)(i)(A)  for a period of two (2) years after the  Closing  Date.
Seller  covenants  and  agrees on its  behalf  and on behalf of its  Affiliates,
successors  and  permitted  assigns  that it will not solicit to hire any of the
Hired Employees for a period of two (2) years after the Closing Date.

     8.06 Post-Closing Covenants. The other Post Closing Covenants are set forth
in Exhibit P.

     8.07 Covenant Not to Sue.  Except in connection  with exercising its rights
to  indemnity  under  this  Agreement,  Buyer,  on  behalf  of  itself  and  its
Affiliates,  covenants  and agrees  that it will not sue or join,  or request or
demand in writing that any Governmental  Body or any Person sue or join,  Seller
or the Seller  Indemnitees  in any  Proceedings  that  arise  under or due to an
Unknown Environmental Condition.

     8.08  Further  Assurances.  Each  Party  shall,  from  time  to time at the
reasonable request of the other, and without further consideration,  execute and
deliver  such  other  instruments  of sale,  transfer,  conveyance,  assignment,
clarification,  and termination,  and take such other action as the Party making
the request may reasonably  require to effectuate the intentions of the Parties,
including  those required to sell,  transfer,  convey and assign to, and vest in
Buyer, and to place Buyer in possession of the Assets, and to transfer,  assign,
or  convey  the  Excluded  Assets  to  Seller  or any  other  property  that was
mistakenly  conveyed to Buyer.  Seller  intends to convey the Assets at Closing;
provided,  however,  if it is determined after Closing that: (i) any part of the
Assets was not in fact conveyed to Buyer,  and that the title to any part of the
Assets is incorrectly in the name of Seller; (ii) any Excluded Asset is conveyed
to Buyer and that the title to such Excluded Asset is incorrectly in the name of
Buyer;  or (iii) any other property that was  mistakenly  conveyed to Buyer as a
part of the Assets and that title to such property is incorrectly in the name of
Buyer,  then each Party shall take all such  action  necessary  to promptly  and
correctly  convey any part of the Assets to Buyer,  or any part of the  Excluded
Assets to Seller or any other property  mistakenly conveyed to Buyer re-conveyed
to Seller.

                               ARTICLE IX: CLOSING

     9.01 Time and Place.  The closing of the  transaction  contemplated by this
Agreement (the "Closing")  shall take place at the offices of Seller in Wichita,
Kansas,  beginning at 8:00 a.m.,  central  time,  on a mutually  agreeable  date
within three (3) Business Days after all conditions to Closing  specified  under
Sections  9.02 and 9.03 have been  either met or waived.  The  Closing  shall be
effective as of 8:00 a.m.  central time on the Closing  Date, or such other date
as the Parties may agree (the  "Effective  Time").  At  Closing,  the  following
events  shall  occur,  each being a condition  precedent  to the others and each
being deemed to have occurred simultaneously with the others:

          (a) Closing Deliveries.

               (i) Buyer shall deliver to Seller a certificate  of an officer of
          Buyer as to the  adoption of  resolutions  of its  General  Partner or
          other  governing  body   authorizing   the  execution,   delivery  and
          performance  of this  Agreement by Buyer and the  consummation  of the
          transaction contemplated hereby;

               (ii) Seller shall  deliver to Buyer  certificates  executed by an
          officer  of each  Seller  as to the  adoption  of  resolutions  of its
          General  Partner  and Board of  Directors  or other  governing  bodies
          authorizing the execution,  delivery and performance of this Agreement
          by Seller and the consummation of the actions contemplated hereby;

               (iii) Seller and Buyer shall execute,  acknowledge and deliver to
          each  other  Assignment  and  Assumption   Agreement(s)   respectively
          assigning  and  assuming the  Leasehold  Interests,  Property  Rights,
          Permits, Contracts and Intellectual Property substantially in the form
          of Exhibit I;

               (iv)  Seller  shall  execute,  acknowledge  and  deliver to Buyer
          Bill(s) of Sale  conveying  the  Facilities,  Inventory and Records to
          Buyer substantially in the form of Exhibit J;

               (v) Seller  shall  deliver to Buyer an original  title to each of
          the titled vehicle(s) listed in Exhibit A and other transfer documents
          required to re-register such titled vehicle(s) in Buyer's name;

               (vi) Seller and Buyer  shall  execute and deliver to each other a
          Transition  Services  Agreement in  substantially  the form of Exhibit
          K-1; the Services  Agreement (Long Term) in substantially  the form of
          Exhibit K-2;  and the  Agreement  for  Anhydrous  Ammonia  Storage and
          Throughput Service in substantially the form of Exhibit Q.

               (vii)  Seller  shall  execute,  acknowledge  and deliver to Buyer
          Special Warranty Deeds for the Real Property substantially in the form
          of Exhibit L;

               (viii) Seller or its Affiliates  shall execute,  acknowledge  and
          deliver to Buyer  easements for access to the certain  portions of the
          Real Property substantially in the form of Exhibit O covering the Real
          Property  owned by  Seller  or its  Affiliate  upon  which  any of the
          Facilities are located;

               (ix)  Buyer  shall  execute  and  deliver  to  Seller a Sales Tax
          Exemption  Certificate(s)  (for  Resale)  for  the  anhydrous  ammonia
          linefill  in a form or forms  acceptable  to the  states  in which the
          linefill is located;

               (x) Seller and Buyer shall  execute and deliver to each other and
          such other  conveyance  documents  and  instruments  of  transfer  and
          assignment  necessary  to convey  the  Assets  to Buyer in the  manner
          contemplated by this Agreement; and

               (xi)  Seller  shall  deliver  to  Buyer a valid  and  enforceable
          release and  termination  agreement from Velocita Corp. and Sea Breeze
          Communications Company which fully releases and terminates (A) any and
          all rights of way previously granted to such entities that are related
          to or located on the same real  property as the Property  Rights,  and
          (B) any and all rights previously  granted to such entities related to
          the Property  Rights,  including any rights to develop the fiber optic
          rights of way located in the Property  Rights or otherwise deal in any
          way with any  fiber  optic or  similar  cable or lines  in,  on, or in
          connection  with,  the Property  Rights,  and shall deliver such other
          related  instruments  and approvals as Buyer may require in connection
          therewith,  such release and termination agreement,  other instruments
          and  other   approvals  to  be  in  form  and   substance   reasonably
          satisfactory to Buyer.

          (b)  Payment.  Buyer shall  deliver to Seller,  and Seller  shall have
     received,  the payment of the  purchase  price set forth in Article III, as
     adjusted,  in  immediately  available  same day funds by wire  transfer for
     credit to Seller's account as designated by Seller in writing not less than
     three (3) Business Days prior to the anticipated Closing Date.

     9.02  Conditions  to Buyer's  Obligations.  Each  obligation of Buyer to be
performed by or at the Closing,  is, at the option of Buyer,  subject to each of
the conditions set forth below.

          (a)  The  representations  and  warranties  made  by  Seller  in  this
     Agreement shall be true and accurate in all material  respects on and as of
     the  Closing  with the same  effect  as  though  such  representations  and
     warranties  have been given on and as of the  Closing  and Buyer shall have
     received a certificate,  dated as of the Closing Date,  signed by Seller to
     such effect.  Seller shall also have  performed  or complied  with,  in all
     material respects, all of its obligations under this Agreement which are to
     be performed or complied  with by it prior to or at Closing and Buyer shall
     have received a certificate, dated as of the Closing Date, signed by Seller
     to such effect.

          (b)  There  shall  not  be  on  the  Closing  (i)  any  Order  by  any
     Governmental  Body,  (ii) any written  threat  thereof by any  Governmental
     Body, which is evidenced by a writing from the threatening  agency or (iii)
     any  Proceeding,  which in all  reasonable  likelihood,  might  prohibit or
     render illegal, the consummation of the transaction  contemplated herein or
     which seeks damages on account thereof.

          (c) All agreements, documents, and instruments contemplated under this
     Agreement to be executed and  delivered by Seller or its  Affiliates  shall
     have been duly executed by Seller or its  Affiliates and shall be ready for
     delivery   concurrently   with  the   consummation   of  the   transactions
     contemplated by this Agreement.

          (d) All required consents, approvals and waivers from any Governmental
     Body,  including  those under the HSR Act, shall have been received,  or if
     applicable,  the  waiting  period  under  the  HSR  Act  applicable  to the
     transactions contemplated hereby shall have expired or been terminated.

          (e) The Assignment and Assumption Agreement  substantially in the form
     of Exhibit I shall have been executed and delivered by Seller and Buyer.

          (f) The Bill(s) of Sale  substantially  in the form of Exhibit J shall
     have been executed and delivered by Seller to Buyer.

          (g)  Seller  and Buyer  shall  execute  and  deliver  to each  other a
     Transition Services Agreement in substantially the form of Exhibit K-1; the
     Services  Agreement (Long Term) in  substantially  the form of Exhibit K-2;
     and the Agreement for Anhydrous  Ammonia Storage and Throughput  Service in
     substantially the form of Exhibit Q.

          (h) The Special Warranty Deeds  substantially in the form of Exhibit L
     shall have been executed and delivered by Seller to Buyer.

          (i) The  Easements  substantially  in the form of Exhibit O shall have
     been executed and delivered by Seller to Buyer.

          (j)  No  material  and  adverse  change  shall  have  occurred  in the
     Business,  and no Casualty  Loss to the Assets  which would have a Material
     Adverse  Effect (as  defined in Section  7.01),  whether or not  covered by
     insurance,  shall have occurred since the Reference Balance Sheet Date, and
     Seller shall have delivered to Buyer a certificate  dated as of the Closing
     Date, executed by Seller representing to Buyer such facts.

          (k) Seller shall have delivered to Buyer an accurate list, dated as of
     the Closing Date, showing: (i) all agreements, contracts and commitments of
     the typed listed on Exhibit F entered into since the date of this Agreement
     (including amendments,  if any, to the items listed on Exhibit F), and (ii)
     all other agreements, contracts and commitments relating to the Business or
     the Assets  entered into since the date of this  Agreement,  together  with
     true,  complete  and  accurate  copies  of all  such  documents  (the  "New
     Contracts").  Buyer  shall  have the right and  opportunity  to review  and
     approve the New  Contracts.  All of the New Contracts  that are approved by
     Buyer shall be included in the Assets (with no addition or  subtraction  to
     or from the Purchase Price) and the future obligations of Seller thereunder
     shall be assigned to and assumed by Buyer pursuant to Section 2.04. Any New
     Contracts not approved by Buyer in writing shall remain the sole obligation
     of Seller  and shall not be  assumed  by  Buyer,  and Buyer  shall  have no
     obligation or liability with respect thereto.

          (k) No notice to or consent,  authorization,  approval or order of any
     Person  shall  be  required  for  the   consummation  of  the  transactions
     contemplated by this Agreement  (except for notices that have been duly and
     timely given and  consents,  authorizations  and  approvals  that have been
     obtained).  True and  correct  copies of all  required  notices,  consents,
     authorizations  and approvals  shall have been delivered to Buyer and shall
     be reasonably satisfactory in form and substance to Buyer and its counsel.

          (l) Buyer shall have  waived,  or Seller  shall have cured,  any title
     defects  with  respect to any of the Real  Property  included  in any title
     reports  secured  by Buyer,  which in  Buyer's  reasonable  judgment  would
     adversely  impair  Buyer's  ownership  or the use of said Real  Property as
     currently used by Seller.

          (m) The release and  termination  agreement and other  instruments and
     other approvals  referenced in Section 9.01(a)(xi) shall have been executed
     and delivered to Buyer.

     9.03  Conditions to Seller's  Obligations.  Each obligation of Seller to be
performed  on the  Closing  is, at the option of Seller,  subject to each of the
conditions set forth below:

          (a) The representations and warranties made by Buyer in this Agreement
     shall  be true  and  accurate  in all  material  respects  on and as of the
     Closing with the same effect as though such  representations and warranties
     had been given on and as of the  Closing and Seller  shall have  received a
     certificate,  dated as of the Closing Date, signed by Buyer to such effect.
     Buyer  shall  also  have  performed  and  complied  with,  in all  material
     respects,  all of its  obligations  under  this  Agreement  which are to be
     performed or complied with by it prior to or at Closing.  Seller shall have
     received a  certificate,  dated as of the Closing Date,  signed by Buyer to
     such effect.

          (b)  There  shall  not be on the  Closing  Date  (i) any  Order by any
     Governmental  Body,  (ii) any written  threat  thereof by any  Governmental
     Body, which is evidenced by a writing received from the threatening  agency
     or (iii) any Proceeding, which in all reasonable likelihood, might prohibit
     or render illegal, the consummation of the transaction  contemplated herein
     or which seeks damages on account thereof.

          (c) All agreements, documents, and instruments contemplated under this
     Agreement  to be  executed  and  delivered  by Buyer  shall  have been duly
     executed  by Buyer and shall be ready for  delivery  concurrently  with the
     consummation of the transactions contemplated by this Agreement.

          (d) All required consents, approvals and waivers from any Governmental
     Body,  including  those under the HSR Act, shall have been received,  or if
     applicable,  the  waiting  period  under  the  HSR  Act  applicable  to the
     transactions contemplated hereby shall have expired or been terminated.

          (e) The Assignment and Assumption Agreement  substantially in the form
     of Exhibit I shall have been executed and delivered by Buyer to Seller.

          (f)  Seller  and Buyer  shall  execute  and  deliver  to each  other a
     Transition Services Agreement in substantially the form of Exhibit K-1; the
     Services  Agreement (Long Term) in  substantially  the form of Exhibit K-2;
     and the Agreement for Anhydrous  Ammonia Storage and Throughput  Service in
     substantially the form of Exhibit Q.

          (g) No Casualty Loss to the Assets which would have a Material Adverse
     Effect (as defined in Section  7.01),  whether or not covered by insurance,
     shall have occurred since the Reference Balance Sheet Date.

          (h) The  Sales  Tax  Exemption  Certificate(s)  (for  Resale)  for the
     anhydrous  ammonia  linefill in a form or forms acceptable to the states in
     which the  linefill is locate  shall have been  executed  and  delivered by
     Buyer to Seller.

                       ARTICLE X: DISCLAIMERS; INDEMNITIES

     10.01 Disclaimers.

          (a) Except as  specifically  set forth in Sections 4.01, 6.01 or 6.02,
     Buyer acknowledges and agrees that the Seller Indemnitees have not made, do
     not  make,  and  expressly   disclaim  any   warranties,   representations,
     covenants,  or guarantees,  either express or implied,  whether  arising by
     operation of law or  otherwise,  as to the  merchantability,  habitability,
     quantity,  quality,  environmental  condition, or physical condition of the
     Assets,  their suitability or fitness for any particular  purpose or use or
     that Buyer may  increase  or  maintain  the  current or  existing  pipeline
     tariffs.  Buyer  affirms  that  it:  (i) has had the  opportunity  prior to
     execution  of  this  Agreement  to  investigate  and  inspect  the  Assets,
     including an environmental  review, and (ii) has made its own determination
     as  to  the:  (A)  merchantability,  habitability,  quantity,  quality  and
     physical  condition  of the  Assets,  and (B) the  Assets'  suitability  or
     fitness for any particular purpose or use.

          (b) Except as otherwise  set forth  herein,  including  the  indemnity
     obligations  hereunder,  Buyer  hereby  agrees to accept  the  Assets  upon
     Closing in their present environmental  condition and physical condition on
     an "as is", "where is", and "with all faults and defects" basis,  including
     environmental,  regardless of how caused or created  (including by Seller's
     Negligence/Fault,  actions,  omissions, or fault, pursuant to any statutory
     scheme,  due to strict  liability,  or otherwise),  and  acknowledges  that
     Seller  shall  not be under  any  obligation  whatsoever  pursuant  to this
     Agreement to undertake any improvement,  repair, modification,  alteration,
     Remediation,  or other  work of any kind with  respect to any of the Assets
     except as set forth in Section 7.01.

          (c)     (i)  Except with respect to those  matters for which Seller is
          Indemnifying  Buyer  as  provided  under  Section  10.03,  the  Seller
          Indemnitees  are hereby  expressly  released by Buyer from any and all
          responsibilities,   obligations,  and  Liabilities/Claims,  known  and
          unknown,  whether based upon  Negligence/Fault  or otherwise,  arising
          under Environmental Laws or any other Legal Requirement, including any
          obligations  to take the Assets back or reduce the Purchase  Price and
          any actions for  contribution,  indemnity,  or to improve,  repair, or
          otherwise modify the physical  condition of the Assets,  that Buyer or
          its  successors or assigns may presently or in the future have against
          any of the Seller  Indemnitees,  based,  in whole or in part, upon the
          presence of Hazardous Materials or other  Environmental  Condition on,
          at,  under,   or  emanating  from  the  Assets  or  arising  from  the
          environmental   condition   or  physical   condition  of  the  Assets,
          regardless  of how caused or created  (by  Seller's  Negligence/Fault,
          actions  or  omissions  pursuant  to any  statutory  scheme  or strict
          liability,   or  otherwise).   Buyer  further  acknowledges  that  the
          provisions of this Section have been fully explained to Buyer and that
          it fully understands and accepts the same as a condition to proceeding
          with this  transaction.  Buyer  acknowledges  that none of the  Seller
          Indemnitees  have made any statements or  representations  contrary to
          the provisions of this section.  Buyer specifically  acknowledges that
          Seller  is  not  assuming  any   Liabilities/Claims  or  Environmental
          liabilities of the Buyer Indemnitees.

               (ii)  Except  with  respect to those  matters  for which Buyer is
          Indemnifying  the Seller  Indemnitees as provided under Section 10.02,
          the Buyer Indemnitees are hereby expressly released by Seller from any
          and all responsibilities,  obligations, and Liabilities/Claims,  known
          and unknown,  whether based on Negligence/Fault or otherwise,  arising
          under Environmental Laws or any other Legal Requirement, including any
          obligations  to  increase  the  Purchase  Price  and any  actions  for
          contribution,  indemnity,  or to improve,  repair, or otherwise modify
          the physical condition of the Assets, that Seller or its successors or
          assigns may  presently  or in the future have against any of the Buyer
          Indemnities,  based,  in  whole  or in  part,  upon  the  presence  of
          Hazardous Materials or other Environmental  Condition on, at or under,
          or  emanating  from the  Assets  or  arising  from  the  environmental
          condition  or  physical  condition  of the Assets,  regardless  of how
          caused or created (by Buyer's  Negligence/Fault,  actions or omissions
          pursuant to any statutory scheme or strict  liability,  or otherwise).
          Seller further  acknowledges  that the provisions of this Section have
          been  fully  explained  to Seller  and that it fully  understands  and
          accepts the same as a condition to proceeding  with this  transaction.
          Seller  acknowledges  that none of the Buyer Indemnitees have made any
          statements  or  representations  contrary  to the  provisions  of this
          section.  Seller specifically  acknowledges that Buyer is not assuming
          any  Liabilities/Claims  or  Environmental  liabilities  of the Seller
          Indemnitees.

               (iii) This Section  10.01(c) is not  intended,  and should not be
          construed,  to: (A) cause Buyer or its successors or assigns to become
          responsible for any Liabilities/Claims or Environmental Liabilities of
          Seller  except as provided in Section  10.02;  (B) cause Seller or its
          successors or assigns to become responsible for any Liabilities/Claims
          or  Environmental  Liabilities  of Buyer except as provided in Section
          10.03; or (C) alter or modify in any manner the indemnity  obligations
          of the parties under this Agreement.

          (d) Except as specifically set forth in Sections 4.01 or 6.01, none of
     the  Seller  Indemnitees  make any  warranty  or  representation,  express,
     implied,  statutory or otherwise, as to the accuracy or completeness of any
     title  opinion,  data,  reports,  records,  projections,   information,  or
     materials  now,  heretofore,  or hereafter  furnished or made  available to
     Buyer in  connection  with the Assets,  including  any  description  of the
     Assets, the pricing  assumptions,  the environmental  condition or physical
     condition of the Assets,  any other  matters  contained in the data, or any
     other  materials  furnished or made  available to Buyer by Seller or by any
     Seller Indemnitee.

          (e) By  virtue  of the  purchase  of the  Assets  from  Seller,  Buyer
     acknowledges  that Seller hereby expressly  excludes,  and does not assign,
     transfer,  or convey to Buyer any rights or benefits of or to any insurance
     policies of Seller or Seller's  Affiliates which might relate to, cover, or
     insure Seller for loss of or liability arising from the use, ownership,  or
     operation of the Assets,  regardless of whether such assignment,  right, or
     benefit arises by statute,  agreement,  or operation of law,  including but
     not limited to defense and indemnity  benefits  attributable  to or arising
     from or under such policies.

     10.02  Buyer's  Indemnity.  After the  Effective  Time,  and to the fullest
extent  permitted by law, but subject to the other provisions of this Article X,
Buyer  shall  Indemnify  the Seller  Indemnitees  from and  against  any and all
Liabilities/Claims arising from or relating to:

          (a) any breach of the representations and warranties or covenants made
     by Buyer in this Agreement;

          (b) Buyer's, its contractors' and/or agents' inspection of the Assets,
     regardless of whether such  Liabilities/Claims  are caused by or arise from
     the Seller Indemnitees' or third Persons' negligence, actions, omissions or
     fault, or otherwise;

          (c) the  possession,  ownership,  condition,  use, or operation of the
     Assets by Buyer,  or its successors or assigns after the Effective Time, or
     the assumption of responsibilities hereunder by Buyer concerning the Assets
     (except that Buyer shall have no duty to Indemnify  the Seller  Indemnitees
     under this Section 10.02(c) with respect to any Environmental  Condition or
     environmental  related  Liabilities/Claims,  which is  covered  exclusively
     under Sections 10.02(d) and 10.02(e)), provided such Liabilities/Claims are
     not  caused  by and do  not  arise  from  Seller  Indemnitees'  negligence,
     actions,  omissions or fault, except that this Indemnity shall apply to the
     extent  Liabilities/Claims  arise  from or relate to the  design,  physical
     condition,  or  maintenance-status  of the Assets as of the Effective Time,
     regardless of whether the design, physical condition, or maintenance-status
     of the Assets is caused by, or arises from,  Seller  Indemnitees'  or third
     Persons' pre-Closing  negligence,  actions,  omissions or fault;  provided,
     further that the  indemnity  set forth in this Section  10.02(c)  shall not
     apply to the extent Seller has an indemnity obligation to Buyer pursuant to
     Section 10.03;

          (d)   any   Environmental    Condition   or   environmental    related
     Liability/Claim  arising  from the  operation  by Buyer,  design,  physical
     condition,  or  maintenance-status  of the Assets after the Effective  Time
     while owned or  operated by Buyer,  its  successors  or assigns;  provided,
     that,  such  Environmental  Condition  does  not  result  from  and  is not
     attributable to the Seller Indemnitees  negligence,  actions,  omissions or
     fault or a third Person's  negligent actions or omissions or fault prior to
     the Effective  Time,  except that this Indemnity  shall apply to the extent
     Liabilities/Claims  arise from or relate to the design, physical condition,
     or maintenance-status of the Assets as of the Effective time, regardless of
     whether the design, physical condition, or maintenance-status of the Assets
     is  caused  by, or  arises  from,  Seller  Indemnitees'  or third  Persons'
     pre-Closing negligence, actions, omissions or fault; provided, further that
     the  indemnity  set forth in this Section  10.02(d)  shall not apply to the
     extent  Seller has an  indemnity  obligation  to Buyer  pursuant to Section
     10.03; and

          (e) any Liabilities/Claims and Environmental  Liabilities arising as a
     result of an Unknown Environmental  Condition,  which Unknown Environmental
     Condition is discovered or reported to Seller more than two (2) years after
     the  Closing  Date,   except  for   Liabilities/Claims   and  Environmental
     Liabilities  arising out or relating to personal injury or death to persons
     or fines and penalties,  for which Buyer shall not owe any indemnity  under
     this Section 10.02(e).

     10.03  Seller's  Indemnity.  After the Effective  Time,  and to the fullest
extent  permitted by law, but subject to the other provisions of this Article X,
Seller  shall  Indemnify  the Buyer  Indemnitees  from and  against  any and all
Liabilities/Claims arising from or relating to:

          (a) any breach of the representations and warranties or covenants made
     by Seller in this Agreement;  provided, that, for purposes of the indemnity
     set forth in this Section 10.03(a),  the  representations and warranties of
     Seller  set  forth in this  Agreement  shall be deemed to have been made by
     Seller  without any  qualifications  regarding  materiality  and  reference
     therein to  "material"  or  "materiality"  or similar words shall be deemed
     deleted,  it being the  agreement  of the Parties  that with respect to the
     indemnity  set forth in this Section  10.03(a),  Seller's  only relief with
     respect to materiality  shall be the Threshold  Amount set forth in Section
     10.04;

          (b) the  possession,  ownership,  use, or  operation  of the Assets by
     Seller prior to the  Effective  Time (except that Seller shall have no duty
     to Indemnify under this Section 10.03(b) with respect to any  Environmental
     Condition or  environmental  related  Liabilities/Claims,  which is covered
     exclusively by the provisions of Sections 10.03(c), 10.03(d) and 10.03(e)),
     except for Liabilities/Claims arising post-Closing to the extent they arise
     from or relate to the design,  physical condition, or maintenance-status of
     the Assets as of the Effective Time, which are specifically and exclusively
     covered by Buyer's indemnity set forth in Sections 10.02(c) and 10.02(d);

          (c) any Known Environmental Condition;

          (d) any Unknown  Environmental  Condition and Environmental  Liability
     arising from an event, condition, incident, action or omissions existing or
     occurring  prior  to the  Effective  Time  relating  to the  Assets  or the
     Business,  except for Environmental Liabilities arising post-Closing to the
     extent  they arise from or relate to the  design,  physical  condition,  or
     maintenance-status  of the  Assets  as of the  Effective  Time,  which  are
     specifically  and  exclusively  covered by Buyer's  indemnity  set forth in
     Sections 10.02(c) and 10.02(d);

          (e)  Seller's  disposal,  treatment,  transportation  for  disposal or
     treatment or the storage in anticipation  of the disposal or treatment,  of
     Hazardous Material prior to the Effective Time;

          (f) any Proceedings  pending before any Governmental  Body as to which
     it has been served process or which Seller has received written notice; and

          (g) any substantial  non-compliance with Legal Requirements associated
     with Seller's ownership or operation of the Assets or the Business prior to
     the Effective Time (but excluding those matters  relating to  Environmental
     Condition or environmental  related  Liabilities/Claims  to the extent they
     are  covered by the  indemnity  set forth in Sections  10.02(d),  10.02(e),
     10.03(c), 10.03(d) and 10.03(e)).

     10.04  Threshold  and  Monetary  Cap.  Notwithstanding  the  provisions  of
Sections  10.02 and 10.03,  with  respect to  Liabilities/Claims  arising  under
Sections 10.03(a), 10.03(b), 10.03(d), 10.03(e), and 10.03(f), Seller shall have
no  liability,  and Buyer shall assume all  liability,  and shall  Indemnify the
Seller Indemnitees from and against all  Liabilities/Claims  with respect to the
first One Hundred Thousand Dollars ($100,000.00) (the "Threshold  Amount");,  it
being  understood that all such  Liabilities/Claims  shall accumulate until such
time or times as the aggregate of such Liabilities/Claims,  exceed the Threshold
Amount,  whereupon Seller shall Indemnify the Buyer Indemnitees from and against
all such  Liabilities/Claims  in excess of the Threshold Amount, up to a maximum
of Fourteen Million Dollars  ($14,000,000.00)(the amount above $100,000.00 up to
a  total  liability  of  $14,000,000.00,  for a total  liability  by  Seller  of
$13,900,000.00) (the "Monetary Cap").  Notwithstanding anything contained herein
(except for the next sentence),  with respect to any such  Liabilities/Claims in
excess of the Monetary Cap, Seller shall, without limitation,  have no liability
to  any  Buyer  Indemnitee,  direct  or  indirect  for  any  Liabilities/Claims.
Notwithstanding the other provisions of this Section 10.04, with respect to: (i)
Seller's  warranties of title set forth in Sections 4.01(q),  6.01 and 6.02, the
monetary cap shall equal the Purchase Price;  and (ii) Seller's  Indemnity under
Section 10.03(c) and action arising from actual fraud or willful misconduct, the
Threshold and Monetary Cap shall not be applicable.

     10.05  Survival.  Except  as  limited  by this  Section  10.05,  all of the
respective indemnifications,  representations, warranties, covenants, agreements
and other obligations of the Parties, including the indemnification  obligations
hereunder,  shall  survive  Closing  and  shall not be  deemed  merged  into any
conveyance  documents.  For the avoidance of doubt, all such  obligations  shall
survive the Closing  regardless of any  investigation  at any time made by or on
behalf of Buyer.

          (a) Representations and Warranties. Except as otherwise stated herein,
     the respective  representations  and warranties of the Parties set forth in
     this Agreement  shall terminate two (2) years after the Closing Date except
     for claims made in writing with  respect to a particular  matter or matters
     prior  thereto,   and  provided  that  any   acknowledgments,   waivers  or
     representations  given  herein  may be  asserted  as a defense by any Party
     hereunder  at any time in  connection  with  defending  a claim  or  claims
     asserted by the other Party, or its successors or permitted  assigns,  with
     regard to any of the transactions contemplated by this Agreement.  Seller's
     representations and warranties of title set forth in Sections 4.01(q), 6.01
     and 6.02  shall  survive  the  Closing  indefinitely,  notwithstanding  any
     otherwise applicable statute of limitation.

          (b)  Indemnities.  Except as otherwise  stated herein,  the respective
     indemnity  obligations  of the  Parties set forth in this  Agreement  shall
     terminate  two (2) years after the  Closing  Date except for claims made in
     writing  with  respect to a  particular  matter or matters  prior  thereto;
     provided,  however,  the following indemnity  obligations shall survive the
     Closing  indefinitely,  notwithstanding any otherwise applicable statute of
     limitation:

               (i) Buyer's indemnity obligations set forth in Section 10.02(e);

               (ii) Buyer's indemnity  obligations set forth in Section 10.02(c)
          and  Section  10.02(d)  solely with  respect to the  design,  physical
          condition  or  maintenance-status  of the  Assets as of the  Effective
          Time;

               (iii)  Seller's  indemnity   obligations  set  forth  in  Section
          10.03(c);

               (iv) Seller's indemnity obligations set forth in Section 10.03(a)
          solely with  respect to Seller's  representations  and  warranties  of
          title set forth in Section 4.01(q) and Section 6.01; and

               (v) the Parties' post-Closing covenants.

          (c) Covenants.  The covenants and obligations of the Parties contained
     in this  Agreement,  to the extent required in order for a Party or Parties
     to receive the intended benefits of any such provision, shall extend beyond
     any  applicable  statutory  limitation  period,  and shall not terminate by
     reason of such statutory limitation period otherwise imposed by law.

     10.06 Sole and Exclusive  Remedy.  Other than claims for actual fraud,  and
except for any right of specific  performance of this Agreement that a Party may
have  under  law or  equity,  the  right of each  Party to seek  indemnification
(subject to the limitations provided for in this Article X) from the other Party
shall be the sole and  exclusive  remedy of each Party  against  the other under
this  Agreement,  and subject to the foregoing,  it is expressly  understood and
agreed  that,  except  by  virtue of the  indemnification  provisions  set forth
herein,   neither   Party  is   entitled  to  any   non-contractual   indemnity,
contribution,  adjustment, reduction, set-off, damages or the like in connection
with the transaction contemplated hereby, but may be entitled to any appropriate
equitable relief.

     10.07  Limitations.  Notwithstanding  anything to the contrary contained in
this Agreement, neither Party:

          (a) shall be liable to the other Party for any  damages  related to or
     arising in connection with this Agreement or the transactions  contemplated
     hereby other than actual or compensatory  damages;  it being agreed that no
     Party shall be liable to the other for indirect, incidental, consequential,
     exemplary,  punitive  damages or  diminution  in value of the Assets or the
     Business hereunder, including any lost earnings or profits or losses due to
     business interruption; or

          (b)  shall  be  entitled  to  recover  more  than  once  for  any  one
     Liability/Claim for which full indemnification is provided hereunder,  such
     as in the case of  Liabilities/Claims  flowing from the breach of more than
     one representation, warranty, covenant, or agreement hereunder.

     10.08 Indemnification  Procedures. If any Proceedings are instituted or any
claim or demand is  asserted  by any Person in respect of which  indemnification
may be sought by any Party or Parties from any other Party or Parties  under the
provisions  of this  Agreement,  the Party or  Parties  seeking  indemnification
(collectively,  the  "Indemnitee")  shall cause  Notice of the  assertion of any
claim of which it has knowledge that is covered by the indemnity to be forwarded
promptly  to  the  Party  or  Parties  from  which   indemnification  is  sought
(collectively,  the "Indemnitor");  provided, that failure or delay in providing
Notice  shall not  relieve  the  Indemnitor  of  liability  except to the extent
prejudiced by such failure or delay. The Indemnitor shall have the right, at its
option and at its own expense, to be represented by counsel of its choice and to
participate in, or, if the Indemnitor  acknowledges in writing to the Indemnitee
the  Indemnitor's  obligations  to Indemnify  the  Indemnitee  with respect to a
Liability/Claim,  to take exclusive control of, the defense, negotiation, and/or
settlement   of  any   Proceeding   or  demand  which  relates  to  any  amounts
indemnifiable  or  potentially  indemnifiable  under this  Agreement;  provided,
however, that the Indemnitee may participate in any such Proceeding with counsel
of its  choice  and at its own  expense,  shall  have a right to  Notice  of any
settlement,  and the  Indemnitor  shall not  execute or  otherwise  agree to any
settlement  or consent  decree which  provides for other than  monetary  payment
without  the  Indemnitee's  prior  written  consent,   which  consent  will  not
unreasonably be withheld,  conditioned or delayed.  If the Indemnitor elects not
to defend or settle  such  Proceeding  or  demand  and the  Indemnitee  defends,
settles, or otherwise deals with any such Proceeding or demand, which settlement
may be without the consent of the Indemnitor, the Indemnitee will act reasonably
and in accordance  with its good faith  business  judgment.  The Parties  hereto
agree to  reasonably  cooperate  fully  with each other in  connection  with the
defense,  negotiation,  or  settlement of any such  Proceeding or demand.  After
final  judgment or award shall have been  rendered by a Government  Body and the
expiration of the time in which to appeal therefrom,  or a settlement shall have
been  consummated,  or the Indemnitee and the Indemnitor shall have arrived at a
mutually binding  agreement with respect to each separate matter  indemnified by
the  Indemnitor,  the Indemnitee  shall forward to the Indemnitor  Notice of any
sums  due and  owing by the  Indemnitor  with  respect  to such  matter  and the
Indemnitor  shall pay all of the sums so owing to the Indemnitee by check within
thirty  (30) days after the date of such  Notice.  If a claim is made by a third
Person against an Indemnitee,  the Indemnitee will, at its own expense,  use its
commercially  reasonable  efforts  to make  available  to the  Indemnitor  those
employees whose  assistance,  testimony,  or presence is necessary to assist the
Indemnitor in evaluating and in defending such claims;  provided,  however, that
any  such  access  shall  be  conducted  in such a  manner  as not to  interfere
unreasonably with the operations of the business of the Indemnitee.

                    ARTICLE XI: INSPECTION AND RECORDS; TITLE

     11.01 Inspection. Prior to Closing, at any reasonable time and from time to
time, Seller shall permit the representatives of Buyer to inspect the Assets and
observe the operating and maintenance  personnel  therein  employed,  to further
observe  any  and  all  activities   related  to  the  maintenance,   operation,
contracting,  and  administration  thereof.  All information  furnished to Buyer
pursuant to this provision will be deemed to be  "Confidential  Information" for
purposes of the Confidentiality Agreement. All inspections shall be conducted in
compliance  with all of Seller's  safety  procedures,  rules and  regulations in
effect at the Assets from time to time, which shall include, without limitation,
site safety training and access restriction  procedures as are normally required
by Seller of third Person invitees.


     11.02 Title  Inspection.  Prior to Closing,  Buyer may complete a review of
title to the Real Property and the Property Rights.

          (a) Title Inspection of Real Property. Seller shall have no obligation
     to cure any Title Defects to any of the Real Property, but, as set forth in
     Section  9.02(l),  if any title  report  prepared by or for Buyer shows any
     title  defects  with respect to any of the Real  Property  which in Buyer's
     reasonable  judgment would adversely impair Buyer's ownership or the use of
     said Real  Property as currently  used by Seller,  Seller's  curing of such
     Title Defects shall be a condition to Buyer's obligation to Close hereunder
     and if not waived by Buyer or cured by Seller,  Buyer  shall have the right
     to terminate this Agreement pursuant to the provisions of Section 14.06.

          (b) Title  Inspection  of Property  Rights,  Leasehold  Interests  and
     Permits.  Seller  shall  notify Buyer prior to Closing of any gaps or Title
     Defects  within  Seller's  Knowledge  with respect to the Property  Rights,
     Leasehold  Interests and Permits.  Upon Buyer's completion of its review of
     the Property  Rights,  Leasehold  Interests  and Permits,  the Parties will
     agree  upon the  known  gaps and  Title  Defects  in the  Property  Rights,
     Leasehold  Interests  and Permits.  The Parties  agree that there will be a
     downward  adjustment to the Purchase Price of Eighty  dollars  ($80.00) per
     rod for gaps or for which there are Title  Defects in the Property  Rights,
     Leasehold  Interests  and Permits,  which the Parties agree is a reasonable
     approximation  of the cost to cure such gaps and  Title  Defects  and which
     shall be reflected in the  adjustment  to the  Purchase  Price  pursuant to
     Section 3.02(b)(iv). If Buyer and Seller do not agree on the number of rods
     for which there are gaps or Title Defects in the Property Rights, Leasehold
     Interests and Permits (which results in a Purchase Price reduction), either
     Buyer or Seller may terminate  this  Agreement  pursuant to Section  14.06.
     Buyer  may  raise  for  consideration  any such  gaps or Title  Defects  it
     discovers prior to Closing.  Subject to Seller's disclosure to Buyer of all
     gaps and Title Defects within Seller's  Knowledge and to agreement upon the
     number of rods for which there are gaps and Title  Defects in the  Property
     Rights, Leasehold Interests and Permits, the mutually agreed upon reduction
     in the Purchase Price (which shall be equal to $80.00/rod  times the number
     of rods for which there is a gap or Title Defect) shall be Buyer's sole and
     exclusive  remedy with respect to any such gaps and Title Defects,  whether
     Known by Seller or unknown as of Closing.

                               ARTICLE XII: TAXES

     12.01 Tax Proceedings. If Buyer or any of its Affiliates receives notice of
any examination,  adjustment,  or other Proceeding relating to the liability for
Taxes of or with respect to Seller for any period prior to the  Effective  Time,
Buyer shall provide Notice to Seller within seven (7) Business Days of receiving
notice  thereof  (or such lesser  time if such  notice  given to Buyer  requires
action in less than  seven (7)  Business  Days).  As to any such Taxes for which
Seller is or may be liable, Seller shall, at Seller's expense, control or settle
the contest of such  examination,  adjustment,  or other  Proceeding,  and shall
defend (upon Buyer's request), indemnify and hold the Buyer Indemnitees harmless
from and against all losses in connection therewith. The Parties shall cooperate
with each other and with their  respective  Affiliates in the  negotiations  and
settlement  of any  Proceeding  described in this  Section  12.01 and in Section
12.02.

     12.02 Sales Taxes.  The Purchase Price provided for hereunder  excludes any
sales Tax or other Taxes required to be paid in connection  with the sale of the
Assets and the Parties agree that this  transaction is an isolated or occasional
sale and that  sales Tax is not due;  however  if any  sales  tax is  eventually
levied upon this  transaction,  as set forth in Section 3.01(b),  Buyer shall be
responsible for all applicable sales and use Taxes, gross receipts,  conveyance,
transfer,  and  recording  fees,  motor  vehicle  transfer  and excise Taxes and
registration  fees, and real estate transfer Taxes and documentary  stamp Taxes,
if any, that may be imposed on any transfer  pursuant to this Agreement,  except
that Buyer shall not be responsible for (i) any Taxes based upon income, or (ii)
any sales,  transfer  or similar  Tax which may be payable  with  respect to the
anhydrous  ammonia owned by Seller as Net Inventory,  for which Seller shall pay
any applicable sales,  transfer or similar Tax. Except for any applicable sales,
transfer or similar Tax on the Net Inventory,  Buyer shall  Indemnify the Seller
Indemnitees from and against any and all sales,  use, gross receipts and similar
Taxes and related  penalties and interest imposed on Seller based on the sale of
the Assets (but not Taxes based on income). To the extent the sale of the Assets
is a sale of tangible  personal  property,  Buyer and Seller shall  cooperate to
obtain any applicable exemption certificates or other documentation necessary to
obtain available Tax exempt status for the sale of the Assets.

     12.03 Other Taxes.  Buyer shall defend (upon Seller's  request),  indemnify
and hold the Seller  Indemnitees  harmless from,  and shall be responsible  for,
paying or withholding or causing to be paid or withheld all Taxes of Buyer which
accrue after the  Effective  Time and for filing all  statements,  returns,  and
documents incident thereto.

                         ARTICLE XIII: EMPLOYEE MATTERS

     13.01 Employees.

          (a) Seller  shall take all action  necessary  to assure that Buyer may
     interview and offer  employment  to any or all of the  employees  listed on
     Schedule  13.01   ("Employees"),   which  offers  of  employment   will  be
     conditioned  upon  Closing  and upon  the  termination  of such  employees'
     employment with Seller or its Affiliates at the Effective Time and shall be
     effective as of the Effective Time.  Buyer shall provide Seller with a list
     of all of  those  Employees  it  wishes  to  interview  or make  offers  of
     employment to without  interviews and shall  coordinate  interviews  with a
     Seller  designated  representative.  Buyer shall  provide  Seller a list of
     those  Employees to whom offers of  employment  have been made,  which list
     shall include the nature and title of the position, salary, and location of
     employment.  Buyer shall also provide Seller with a list of those Employees
     accepting Buyer's employment offer on or before seven (7) days prior to the
     anticipated  Closing Date.  Such offers of employment  shall be on the same
     basis, and Buyer shall treat the Hired Employees on substantially  the same
     basis, as other similarly situated employees of Buyer.

          (b) The Hired Employees will become Buyer's Employees at the Effective
     Time.  At that time,  Buyer will become  responsible  for wages,  salaries,
     benefits, other compensation,  severance pay, and severance benefits to the
     extent  required under federal,  state,  or local law, or notices  required
     under such laws with respect to the Hired Employees arising with respect to
     employment  with Buyer and which relate to any period  after the  Effective
     Time.  Buyer shall  Indemnify the Seller  Indemnitees  from and against any
     Liabilities/Claims  by any  Hired  Employees  for  their  wages,  salaries,
     bonuses,  severance  pay, and severance  benefits  provided  under federal,
     state, or local law,  notices required under such laws, and compensation or
     benefits of any kind which accrue under Buyer's employee benefit plans as a
     result of and related to any of the Hired Employees'  employment with Buyer
     after the Effective Time.

          (c) Seller shall retain  responsibility  for, and shall  Indemnify the
     Buyer  Indemnitees  from and against all liabilities or obligations for the
     following  matters  which  accrue  for  the  periods  prior  and  up to the
     Effective Time as a result of the Employees' employment with Seller:

               (i) wages, salaries, commissions and bonuses;

               (ii) all accrued and outstanding  employee benefits and severance
          pay and  severance  benefits  to the extent  required  under  federal,
          state, or local law, or notices  required under such laws with respect
          to Employees of Seller who are terminated prior to the Effective Time;

               (iii) vacation pay with respect to the Hired Employees; and

               (iv) any  other  employee-related  matters  or  liabilities  with
          respect to its employees during the periods in which they are employed
          by Seller.

     13.02 Employee Benefit Plans.

          (a) At the Effective  Time,  Seller or its Affiliates  shall cause the
     termination  of the  participation  of the  Hired  Employees  in all of the
     Plans,  except that the Hired  Employees'  participation in Seller's or its
     Affiliates' medical and dental plans shall continue through the last day of
     the month in which the Effective Time occurs.  On the last day of the month
     in which the Effective Time occurs,  the Hired Employees'  participation in
     Seller's  or its  Affiliates'  medical and dental  plans  shall  terminate.
     Seller shall determine whether the "same desk" rule applies to the Seller's
     or its Affiliates' Tax qualified savings plan. If such rule does not apply,
     Seller shall make  distribution  to the Hired  Employees in accordance with
     the terms of Seller's or its Affiliates' plan.

          (b) All of the Hired  Employees  will be permitted to enroll in all of
     Buyer's  "employee  welfare  benefit  plans,"  as that term is  defined  in
     Section 3(1) of ERISA, upon the termination of such benefits under Seller's
     or its  Affiliates'  Plans  and any  other  employee  programs  of Buyer in
     accordance  with the terms and  conditions of Buyer's plans and programs in
     effect from time to time for its similarly situated employees generally.

          (c) Subject to the  satisfaction of the conditions  described below in
     this Section 13.02(c), at the Effective Time Buyer shall waive or cause the
     waiver of waiting periods,  pre-existing condition exclusions,  deductibles
     (for the  remainder  of  2002),  and  other  limitations  on  participation
     otherwise  applicable to any Hired Employee and qualified  dependents  (who
     were  covered  by an  employee  welfare  benefit  plan  of  Seller  or  its
     Affiliates  and  immediately  elects to be covered by an  employee  welfare
     benefit  plan of  Buyer)  under or with  respect  to all  employee  welfare
     benefit plans maintained by Buyer. The conditions for the waivers described
     above are:

               (i) Buyer will waive waiting  periods to the extent  service with
          Seller  would  otherwise  satisfy  the  waiting  period  and the Hired
          Employee is actively at work. For Long Term Disability Insurance,  the
          waiver is contingent  upon  receiving a waiver from Buyer's  insurance
          carrier;

               (ii) Buyer will waive  pre-existing  condition  exclusions to the
          extent a Certificate  of  Creditable  Coverage is presented by and for
          the  Hired  Employee  and  all  dependents  showing  coverage  for the
          eighteen (18) months immediately prior to coverage under Buyer's plan;
          and

               (iii) Buyer will offset (waive or partially waive) deductibles to
          the extent the Hired Employee or dependent shows  reasonable  evidence
          of  satisfaction  of the applicable  deductible with Seller during the
          same calendar year.

          (d) Seller shall retain responsibility for any medical,  dental, life,
     vision, AD&D, cafeteria,  short-term  disability,  and long-term disability
     claims  by any  Hired  Employee  which  were  incurred  on or  prior to the
     Effective  Time and for workers'  compensation  claims  related to injuries
     arising from the employment of the Hired Employees for periods prior to and
     through  the  Effective  Time,  in each case to the  extent  covered by the
     respective  employee benefit plan and/or insurance plan or policy of Seller
     or its Affiliates,  and any claims regarding the Seller's 401(k) Plan which
     arise out of the  administration  or  operation  of such Plan  prior to the
     Effective Time.  Seller shall be responsible,  and bear all costs,  for the
     administration  and termination of such benefits and Seller  represents and
     warrants  that Buyer shall have no liability  with respect  thereto.  Buyer
     states that it does not assume,  and shall have no  liability  with respect
     to,  any  medical,  dental,  life,  vision,  AD&D,  cafeteria,   short-term
     disability or long-term  disability claims by any Hired Employee which were
     incurred on or prior to the  Effective  Time or for  workers'  compensation
     claims  related  to  injuries  arising  from the  employment  of the  Hired
     Employees for periods prior to and through the Effective Time, in each case
     whether or not  covered by the  respective  employee  benefit  plan  and/or
     insurance  plan or  policy  of  Seller  or its  Affiliates,  or any  claims
     regarding the Seller's 401(k) Plan which arise out of the administration or
     operation of such plan prior to the Effective Time.

          (e) For purposes of this Section,  a claim for  reimbursement  under a
     medical,  hospital or dental,  prescription  drug, or similar plan shall be
     deemed to be incurred on the date that the claim occurs.  A claim occurs on
     the date service is provided and there shall be no  continuation of a claim
     from one day to the  next.  In the  event of a  hospitalization  commencing
     prior to the last day of the month in which the Effective Time occurs,  any
     existing  coverage  shall  cease on the last day of the  month in which the
     Effective  Time occurs  unless the  participant  elects COBRA  continuation
     coverage.

          (f) With respect to the Hired Employees,  prior employment with Seller
     or an Affiliate  thereof shall be  recognized by Buyer,  for the purpose of
     determining  service  awards,  severance,  vacation  eligibility,  and  for
     eligibility,  vesting,  and  participation  under Buyer's  employee benefit
     plans, but not with respect to calculating  pension benefit  payments.  All
     Hired Employees shall be subject to Buyer's vacation policies, provided all
     such Hired Employees  shall be given full credit for  pre-Closing  years of
     service recognized by Seller and its Affiliates for vacation purposes under
     Buyer's policy.  Seller shall be responsible for payment to Hired Employees
     for any accrued and earned but not used vacation.  The Hired Employees will
     be permitted by Buyer to take the vacation  time paid by Seller as time off
     without pay after the Closing Date until they reach their  anniversary year
     at which  time  they  will be given  vacation  recognizing  prior  years of
     service with Seller on Buyer's vacation schedule.

          (g) Seller shall not include a reserve for accrued bonuses through the
     Effective  Time.  Seller shall pay such  amounts,  if any,  directly to the
     Hired Employees.

     13.03  No  Third  Party  Employee   Beneficiary.   The  Parties   expressly
acknowledge  that this  Agreement is not  intended to create a contract  between
either Buyer or Seller,  on the one hand, and any Hired  Employee,  on the other
hand,  and no Hired  Employee  may rely on this  Agreement  as the basis for any
breach of  contract  claim  against  Buyer or Seller.  Seller  shall not, in any
manner,  be  responsible  or liable  for  administration  or the  payment of any
benefit due under any plans maintained by Buyer after the Closing.

     13.04 Federal Worker  Adjustment and Retraining  Notification  Act.  Seller
shall have caused the termination of the employment of the Hired Employees as of
the Effective  Time and shall have provided such notice of termination if and as
required by the Worker  Adjustment  Retraining and Notification Act, as amended,
and  shall  have  complied  with  any  comparable  state or  local  statutes  or
regulations.

                      ARTICLE XIV: MISCELLANEOUS PROVISIONS

     14.01  Commission.  Each of the Parties  represents and warrants that there
are no claims for brokerage  commission or finders' fees in connection  with the
transaction  contemplated  by this Agreement  arising as a result of any actions
taken or agreements by such Party, and Seller and Buyer will respectively pay or
discharge, and will Indemnify the other Party against,  brokerage commissions or
finders' fees incurred by reason of any action taken by such Indemnitor.

     14.02  Assignment.  The terms,  provisions and conditions of this Agreement
shall extend to, be binding upon and inure to the benefit of the Parties,  their
respective successors and permitted assigns. No Party will make an assignment of
its rights and/or  obligations  under this  Agreement  without the prior written
consent of the other,  which such  consent may be withheld  for any reason.  Any
assignment  or attempted  assignment in violation of this Section shall be void.
Notwithstanding the foregoing,  either Party may assign this Agreement,  and its
rights and  obligations  hereunder,  to any of its  respective  Affiliates  upon
providing  Notice to the other Party without first obtaining the written consent
of the other Party;  provided that the  assigning  Party shall remain liable for
its obligations hereunder notwithstanding such assignment.

     14.03 Entire  Agreement;  Amendments.  This  Agreement and the exhibits and
schedules  attached  hereto and  incorporated  by reference  herein  contain the
entire  understanding  of the Parties with respect to its subject matter.  There
are no restrictions, agreements, promises, warranties, covenants or undertakings
relating to the transactions  contemplated herein other than those expressly set
forth herein. This Agreement  supersedes all prior agreements and understandings
between the Parties with respect to its subject  matter.  This  Agreement may be
amended only by a written instrument duly executed by the Parties. Any condition
to a Party's  obligations  hereunder may be waived in writing by such Party.  No
waiver by any Party of any one or more defaults by the other in  performance  of
any of the  provisions  of this  Agreement  shall  operate or be  construed as a
waiver  of any  future  default  or  defaults,  whether  of a like or  different
character.

     14.04  Severability.  Each  portion of this  Agreement  is  intended  to be
severable.  If any term or provision hereof is illegal or invalid for any reason
whatsoever,  such illegality or invalidity  shall not affect the validity of the
remainder of this Agreement.

     14.05 Actions. Seller and Buyer, singularly and plurally, warrant and agree
that each shall use its commercially  reasonable  efforts to take or cause to be
taken all such action as may be necessary to consummate  and make  effective the
transaction  as set forth in this  Agreement  and to assure  that it will not be
under any  material  corporate,  legal or  contractual  restriction  that  would
prohibit or delay the timely consummation of such transaction.

     14.06 Termination.

          (a)  This  Agreement  may be  terminated  at any  time on or  prior to
     Closing:

               (i) by mutual written consent of Seller and Buyer;

               (ii) by Seller if the  conditions  set forth in Section 9.03 have
          not been satisfied in all material  respects by Buyer or not waived by
          Seller in writing by December 31, 2002 (the "Drop Dead Date");

               (iii) by Buyer if the  conditions  set forth in Section 9.02 have
          not been satisfied in all material respects by Seller or not waived by
          Buyer in writing by the Drop Dead Date;

               (iv) by  Buyer  or  Seller  pursuant  to and in  accordance  with
          Section 7.01 or Section 11.02(b); or

               (v)  by  Buyer  pursuant  to  and  in  accordance   with  Section
          7.02(b)(iv) or Section 11.02(a).

          (b) If the  Closing  does not occur as a result  of  either  Seller or
     Buyer  exercising  its right to terminate  pursuant to this Section  14.06,
     this  Agreement  shall be null and void, and no Party shall have any rights
     or obligations under this Agreement, except that:

               (i) A termination  shall not relieve any Party from any liability
          for  breach   hereof   occurring   prior  to   termination,   and  the
          non-breaching  Party  shall be  entitled  to any and all relief  under
          applicable law or in equity on account of such breach; and

               (ii)  Buyer's  obligations  under the  Confidentiality  Agreement
          shall survive any such termination.

     14.07  Counterparts.  This Agreement may be executed  simultaneously in any
number of  counterparts,  each of which shall be deemed an original,  but all of
which together shall constitute one and the same instrument.

     14.08  Governing  Law.  This  Agreement  shall be governed by,  enforced in
accordance with, and interpreted under, the laws of the State of Kansas, without
regard to its conflicts of law principles.

     14.09 Time of Essence.  With regards to dates and time periods set forth or
referred to in this Agreement, time is of the essence.

     14.10 Nondisclosure of Confidential Information.

          (a)  Seller  recognizes  and  acknowledges  that it has  knowledge  of
     certain  confidential  information  regarding  the Assets and the  Business
     which  will  be  included  in the  Assets  conveyed  to  Buyer  at  Closing
     hereunder. Seller agrees that it will not disclose, and will use reasonable
     commercial  efforts  to  prevent  disclosure  to any  other  Person of such
     confidential  information  except to authorized  representatives  of Buyer.
     Seller  recognizes  and agrees that  violation of this  provision may cause
     irreparable  damage or injury  to Buyer,  the exact  amount of which may be
     impossible to ascertain,  and that Buyer may be entitled to an  injunction,
     without the necessity of posting a bond therefor,  restraining  any further
     violation  of this  provision.  Such rights to any  injunction  shall be in
     addition to, and not in limitation  of, any other rights and remedies Buyer
     may have vis-a-vis Seller.

          (b) The Parties acknowledge and agree that the terms and conditions of
     this Agreement, including any Exhibits and Schedules referenced herein, are
     confidential  and proprietary to each of the Parties and that they will use
     reasonable  commercial efforts to prevent disclosure of the contents hereof
     to any Person, except as by an authorized representative of the other Party
     (including that Party's  attorneys,  accountants,  auditors and lenders who
     are  bound to a duty of  confidentiality  to that  Party),  and  except  as
     required, and then only to the extent required, to be disclosed pursuant to
     a Legal Requirement, and then the Party disclosing it shall make reasonable
     commercial  efforts to obtain reliable assurance from the Person to whom it
     is disclosed that confidential  treatment will be accorded thereto. In such
     instance the other Party shall be provided  sufficient  prior Notice of the
     requirement to disclose such that the other Party may seek, at its expense,
     a protective order or other appropriate remedy with respect thereto.

     14.11  Assignment of Contracts  and Property  Rights.  Notwithstanding  any
other  provision  of this  Agreement,  nothing in this  Agreement or any related
document  shall be  construed  as an  attempt  to  assign or  transfer:  (i) any
Contract,  Leasehold Interest, Permit or Property Right which as a matter of law
or by its terms,  is  non-assignable  without the  consent of the other  parties
thereto unless such consent has been given,  or (ii) any Contract or claim as to
which all of the remedies for the  enforcement  thereof  enjoyed by Seller would
not,  as a  matter  of  law or by its  terms,  pass  to  Buyer  incident  to the
assignment  or transfer to Buyer to be made under this  Agreement.  However,  in
order to  assist  Buyer  in  preserving  and  realizing  the full  value of such
Contracts,  Leasehold Interests, Permits, Property Rights and claims, Seller, at
the  request of Buyer,  shall  exercise  reasonable  efforts to assist  Buyer in
capturing the commercial  benefit of such  non-assignable  Contracts,  Leasehold
Interests,  Permits and Property  Rights,  and to facilitate  the  collection of
moneys due and payable and to become due and payable  thereunder  to Buyer under
such  Contracts and claims.  Seller shall  promptly pay over to Buyer all moneys
collected by or paid to it with respect to each such Contract or claim.

     14.12 Notices and Addresses.

          (a) All notices  required or permitted  hereunder  shall be in writing
     and shall be served on the  Parties at the  addresses  set forth in Section
     14.12(b).  Any such  notices  may be sent by: (i) a  nationally  recognized
     overnight courier, in which case notice shall be deemed delivered three (3)
     Business Days after deposit with such courier; (ii) facsimile transmission,
     in which case  notice  shall be deemed  delivered  upon  actual  receipt by
     recipient;  (iii) certified mail, return receipt  requested,  in which case
     notice will be deemed  delivered three (3) Business Days after mailing;  or
     (iv)  hand-delivery,  in which case notice shall be deemed  delivered  upon
     actual  receipt  by  recipient.  Copies of  notices  are for  informational
     purposes  only, and a failure to give or receive copies of any notice shall
     not be deemed a failure to give notice.  Any notice or other  communication
     required to be given under this Agreement or in connection with the matters
     contemplated by it shall be in writing in the English language. The refusal
     to accept delivery shall constitute acceptance, and in such event, the date
     of   delivery   shall  be  the  date  on  which   delivery   was   refused.
     Notwithstanding  anything to the contrary contained herein, if the delivery
     of any notice, item, or information,  pursuant to the terms hereof,  begins
     the running of a time period  during  which a Party is obligated to respond
     or else have its approval deemed to have been granted or denied,  then such
     notice, item, or information shall either bear or be accompanied by a cover
     letter  w+hich bears the  following  legend (in bold and capital  letters):
     "TIME  SENSITIVE  REQUEST -  RESPONSE  REQUIRED  WITHIN A FINITE  NUMBER OF
     DAYS."

          (b) The  addresses  and other  details of the  Parties are (or at such
     other address as either Party may designate by written notice):

                  Seller:       Koch Pipeline Company, L.P.
                                4111 East 37th Street North
                                Wichita, Kansas 67220
                                Attention:  President
                                Phone Number: (316) 828-5385
                                Fax Number:     (316) 828-7666

                                Koch Fertilizer Storage and Terminal Company
                                4111 East 37th Street North
                                Wichita, Kansas 67220
                                Attention: President
                                Phone Number: (316) 828-8996
                                Fax Number:     (316) 828-7946

                  With copies to:   Koch Fertilizer Storage and Terminal Company
                                    4111 East 37th Street North
                                    Wichita, Kansas 67220
                                    Attention: Steven  H. Carter
                                    Phone Number: (316) 828-5138
                                    Fax Number:     (316) 828-9811

                                    Koch Pipeline Company, L.P.
                                    4111 E. 37th Street North
                                    Wichita, KS  67220
                                    Attention: General Counsel
                                    Phone Number:  (316) 828-4550
                                    Fax Number:      (316) 828-7997

                  Buyer:            Kaneb Pipe Line Operating Partnership, L.P.
                                    2425 North Central Expressway, Suite 700
                                    Richardson, TX 75080-2731
                                    Attn.: Edward D. Doherty
                                           Chairman of the Board and
                                           Chief Executive Officer
                                    Phone Number: (972) 699-4013
                                    Fax Number:   (972) 699-1894

                  With Copies to:   Kaneb Pipe Line Operating Partnership, L.P.
                                    7340 West 21st Street N, Suite 200
                                    Wichita, KS  67205
                                    Attn.: Jimmy L. Harrison, President
                                    Phone Number: (316) 773-9000
                                    Fax Number: (316) 773-9001

                                    Fulbright & Jaworski L.L.P.
                                    2200 Ross Avenue, Suite 2800
                                    Dallas, TX  75201
                                    Attn.: Kenneth L. Stewart
                                    Phone: (214) 855-8060
                                    Fax Number: (214) 855-8200

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<PAGE>
     IN WITNESS  WHEREOF,  the Parties have hereto set their hands by their duly
authorized officials as of the date set forth above.
<TABLE>
<CAPTION>

 "Seller"                                            "Seller"

<S>                                                   <C>
Koch Pipeline Company, L.P.                           Koch Fertilizer Storage and Terminal Company
By:      Koch Pipeline Company, LLC,
         Its General Partner

By:                                                   By:
   -----------------------------------------             -------------------------------------------------
         Anthony L. Botterweck                                Daniel J. Stecklein
         President                                            President
</TABLE>

"Buyer"

Kaneb Pipe Line Operating Partnership, L.P.
By:      Kaneb Pipe Line Company, LLC,
         Its General Partner


By:
   -----------------------------------------
Name:  Jimmy L. Harrison
Title:    President

Signature  page to that certain Asset  Purchase and Sale  Agreement by and among
Koch Pipeline  Company,  L.P. and Koch Fertilizer  Storage and Terminal  Company
(together, "Seller") and Kaneb Pipe Line Operating Partnership, L.P. ("Buyer").