exv10w6









Exhibit 10.6




EXECUTION VERSION




FIRST AMENDMENT TO

PIPELINE SYSTEMS OPERATING AGREEMENT




     THIS FIRST AMENDMENT TO PIPELINE SYSTEMS OPERATING AGREEMENT (this “Amendment”) is
made and entered into as of this 31st day of March, 2010 by and among Navajo Refining
Company, L.L.C., a Delaware limited liability company (“Navajo Refining”), Lea Refining
Company, a Delaware corporation (“Lea Refining”), Woods Cross Refining Company, L.L.C., a
Delaware limited liability company (“Woods Cross Refining”), Holly Refining & Marketing —
Tulsa LLC, a Delaware limited liability company (“Holly Refining Tulsa” and, together with
Navajo Refining, Lea Refining, and Woods Cross Refining, the “Holly Entities”), and Holly
Energy Partners—Operating, L.P., a Delaware limited partnership (“Operator”). Each of the
Holly Entities and the Operator are sometimes individually referred to herein as a “Party”
and collectively as the “Parties.”



     WHEREAS, the Parties entered into that certain Pipeline Systems Operating Agreement on
February 8, 2010, to be effective as of December 1, 2009 (the “Agreement”), and now desire
to amend certain provisions of such Agreement, as set forth herein in connection with the
acquisition of certain assets by certain of the subsidiaries of Operator from certain of the Holly
Entities. Capitalized terms used, but not defined, herein shall have the meanings given to them in
the Agreement.



     NOW, THEREFORE, in consideration of the foregoing recitals and the agreements contained
herein, and for other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Parties hereto, intending to be legally bound, do hereby agree as follows:



     1. Amendment to Exhibit A. Exhibit A is hereby amended and restated in its entirety
as set forth on Exhibit A-1 hereto.



     2. Amendment to Exhibit B. Exhibit B is hereby amended and restated in its entirety
as set forth on Exhibit B-1 hereto.



     3. No Further Amendment; Miscellaneous. Except as amended hereby, all of the terms
and conditions of the Agreement shall remain in full force and effect. The “General Conditions;
Miscellaneous” provisions set forth in Sections 13.1, 13.2, 13.3,
13.4, 13.5, 13.8, 13.12, 13.13, 13.15, and
13.16 of the Agreement, are hereby incorporated herein by reference.



[Signature Page Follows]








 









 








     IN WITNESS WHEREOF, the Parties hereto have executed this First Amendment to Pipeline Systems
Operating Agreement as of the date first above written.



	 	 	 	 	 
	 	OPERATOR:





HOLLY ENERGY PARTNERS-OPERATING, L.P.

 	 
	 	By:  	/s/ David G. Blair
 	 
	 	 	David G. Blair 	 
	 	 	Senior Vice President 	 
	 
	 	HOLLY ENTITIES:





NAVAJO REFINING COMPANY, L.L.C.

 	 
	 	By:  	/s/ David L. Lamp
 	 
	 	 	David L. Lamp 	 
	 	 	Executive Vice President 	 
	 
	 	LEA REFINING COMPANY

 	 
	 	By:  	/s/ David L. Lamp
 	 
	 	 	David L. Lamp 	 
	 	 	Vice President 	 
	 
	 	WOODS CROSS REFINING COMPANY,

L.L.C.

 	 
	 	By:  	/s/ David L. Lamp
 	 
	 	 	David L. Lamp 	 
	 	 	President 	 
	 



Signature Page 1 of 1 to First Amendment to Pipeline Systems Operating Agreement





 











 





	 	 	 	 	 
	 	HOLLY REFINING & MARKETING – TULSA LLC

 	 
	 	By:  	/s/ David L. Lamp
 	 
	 	 	David L. Lamp 	 
	 	 	President 	 
	 



	 	 	 	 	 
	ACKNOWLEDGED AND AGREED:



HOLLY CORPORATION

 	 
	By:  	/s/ David L. Lamp
 	 
	 	David L. Lamp 	 
	 	President 	 
	 



	 	 	 	 	 
	ACKNOWLEDGED AND AGREED:



HOLLY ENERGY PARTNERS, L.P.

 	 
	By:  	HEP Logistics Holdings, L.P.,
 	 
	 	its General Partner 	 



	 	 	 	 	 
	 	 	 
	 	By:  	                  Holly Logistic Services, L.L.C.,
 	 
	 	 	its General Partner 	 



	 	 	 	 	 
	 	 	 
	 	By:  	                                  /s/ David G. Blair
 	 
	 	 	David G. Blair 	 
	 	 	President 	 
	 



Signature Page 2 of 2 to First Amendment to Pipeline Systems Operating Agreement









 









 











EXHIBIT A-1




Basic Description of Systems and Management Fee


Management Fee 



The Management Fee for 2009 will be the “Total Management Fee” as set forth in the table below and
will be allocated among the Systems as set forth in the table below.



Systems




	 	 	 	 	 	 	 
	 	 	 	 	Amount of Management
	 	 	Owner of Asset	 	Fee Allocated to the Asset
	General Systems Management	 	 	 	 
	 

	 	N/A
	 	$	150,000.00	 
	Insurance Reimbursement	 	 	 	 
	 

	 	N/A
	 	$	15,000.00	 
	Artesia System
	 	 	 	 	 	 
	(None)

	 	N/A
	 	 	N/A	 
	Lovington System
	 	 	 	 	 	 
	Ponderosa Junction
to Lovington -
LPG/Natural Gasoline
Pipeline having a
diameter of 8” and
extending
approximately 11 1/2
miles and a diameter
of 6” extending
approximately 8
miles

	 	Navajo Refining Company,
L.L.C.
	 	$	0.00	 
	Woods Cross System
	 	 	 	 	 	 
	Woods Cross 12”
Plains Crude Oil
Delivery Pipeline
extending
approximately 700
feet

	 	Woods Cross Refining
Company, L.L.C.
	 	$	25,000.00	 
	Woods Cross 6”
Hydrogen Pipeline
extending
approximately 4
miles

	 	Woods Cross Refining
Company, L.L.C.
	 	$	25,000.00	 
	 

	 	Total Management Fee:
	 	$	215,000.00	 






Exhibit A-1




 









 








EXHIBIT B-1




Services included in Management Fee




	 	PART I — 	 	

Management services and costs included in the Management Fee, as contemplated by
Section 8.2 of the foregoing Agreement are the following:







	 	•	 	Operator’s central office costs
	 
	 	•	 	General administration of Pipeline operations by Operator’s senior management personnel
	 
	 	•	 	General administration of Pipeline operations by Operator’s operations management
personnel
	 
	 	•	 	Supervision of the Pipeline Control Center
	 
	 	•	 	Environmental, health and safety management
	 
	 	•	 	Administrative services relating to DOT compliance
	 
	 	•	 	Preparation and submission of FERC Reports
	 
	 	•	 	Pipeline Scheduling
	 
	 	•	 	Purchasing
	 
	 	•	 	Right of Way services after the In-Service Date (excluding new projects)
	 
	 	•	 	Travel and meeting expenses for necessary meetings
	 
	 	•	 	Crisis Communications
	 
	 	•	 	Ordinary course administration of contracts between the Holly Entities and customers of
the Holly Entities (excluding outside counsel services deemed necessary by Operator)
	 
	 	•	 	Normal operating activities of the Facilities






	 	PART II — 	 	
For avoidance of doubt, the following work and services are specifically
excluded from the Management Fee and shall be paid to Operator by the Holly Entities, along
with other costs, under Section 8.3 of the foregoing Agreement:







	 	•	 	Operations personnel to the extent performing services in connection with activities
outside the normal operation of the Systems
	 
	 	•	 	All direct operating costs incurred outside the normal operation of the Systems
	 
	 	•	 	Services obtained from third-parties
	 
	 	•	 	Travel and meal expenses for Operator’s personnel while performing work on the assets
set forth on Exhibit A
	 
	 	•	 	Pipeline measurement including contract proving
	 
	 	•	 	Insurance
	 
	 	•	 	All project management, engineering and other services related to any expansion project
	 
	 	•	 	Compliance and other costs or expenses incurred in connection with any regulatory
program to the extent directly applicable to the Systems, including, but not limited to,
compliance with governmental requirements and guidelines for public awareness, contractor
awareness, one-call, operator qualification, facility response plans, drug and alcohol
testing and other requirements and guidelines of any governmental authority with
jurisdiction
	 
	 	•	 	Annual DOT fees
	 
	 	•	 	Procurement, maintenance and replacement of safety equipment and materials
	 
	 	•	 	Preparation and filing of required reports and permit applications with governmental
entities with jurisdiction (other than FERC and DOT), including, but not limited to
environmental permit reporting and permit renewals (third party contract costs only)





Exhibit B-1