Exhibit 10.11

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                           REVOLVING CREDIT AGREEMENT

                           dated as of April 24, 2003

                                      among

                   KANEB PIPE LINE OPERATING PARTNERSHIP, L.P.
                                   as Borrower

                         KANEB PIPE LINE PARTNERS, L.P.
                                     as KPP

                   THE LENDERS FROM TIME TO TIME PARTY HERETO

                                       and

                                  SUNTRUST BANK
                             as Administrative Agent


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                           SUNTRUST ROBINSON HUMPHREY,
                   A DIVISON OF SUNTRUST CAPITAL MARKETS, INC.
                                       and
                         BANC ONE CAPITAL MARKETS, INC.,
                    as Joint Lead Arrangers and Book Managers

                                  BANK ONE, NA
                              as Syndication Agent


                                   BNP PARIBAS

                               FLEET NATIONAL BANK
                                       and

                          KEYBANK NATIONAL ASSOCIATION,
                           as Co-Documentation Agents



<PAGE>

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>

                                                                                                              Page


                       Article I DEFINITIONS; CONSTRUCTION

<S>                                                                                                           <C>
Section 1.1. Definitions..........................................................................................1
Section 1.2. Classifications of Loans and Borrowings.............................................................20
Section 1.3. Accounting Terms and Determination..................................................................20
Section 1.4. Terms Generally.....................................................................................20

                 Article II AMOUNT AND TERMS OF THE COMMITMENTS

Section 2.1. The Revolving Credit Facility.......................................................................21
Section 2.2. The Loans...........................................................................................21
Section 2.3. Procedure for Borrowings............................................................................21
Section 2.4. Funding of Borrowings...............................................................................22
Section 2.5. Interest Elections..................................................................................22
Section 2.6. Reduction and Termination of Commitments............................................................23
Section 2.7. Repayment of Loans..................................................................................24
Section 2.8. Evidence of Indebtedness............................................................................24
Section 2.9. Prepayments.........................................................................................24
Section 2.10. Interest on Loans..................................................................................25
Section 2.11. Fees...............................................................................................25
Section 2.12. Computation of Interest and Fees...................................................................26
Section 2.13. Inability to Determine Interest Rates..............................................................26
Section 2.14. Illegality.........................................................................................27
Section 2.15. Increased Costs....................................................................................27
Section 2.16. Funding Indemnity..................................................................................28
Section 2.17. Taxes..............................................................................................29
Section 2.18. Payments Generally; Pro Rata Treatment; Sharing of Set-offs........................................30
Section 2.19. Letters of Credit..................................................................................32
Section 2.20. Mitigation of Obligations; Replacement of Lenders..................................................36
Section 2.21. Increase of Commitments; Additional Lenders........................................................37

                    Article III CONDITIONS PRECEDENT TO LOANS

Section 3.1. Conditions To Effectiveness.........................................................................38
Section 3.2. Each Credit Event...................................................................................40
Section 3.3. Delivery of Documents...............................................................................40

                    Article IV REPRESENTATIONS AND WARRANTIES

Section 4.1. Existence; Power....................................................................................41
Section 4.2. Organizational Power; Authorization; Enforceability.................................................41
Section 4.3. Governmental Approvals; No Conflicts................................................................41
Section 4.4. Financial Statements................................................................................42
Section 4.5. Litigation and Environmental Matters................................................................42
Section 4.6. Compliance with Laws and Agreements.................................................................42
Section 4.7. Investment Company Act, Etc.........................................................................42
Section 4.8. Taxes...............................................................................................43
Section 4.9. Margin Regulations..................................................................................43
Section 4.10. ERISA..............................................................................................43
Section 4.11. Ownership of Property..............................................................................43
Section 4.12. Disclosure.........................................................................................44
Section 4.13. Labor Relations....................................................................................44
Section 4.14. Insolvency.........................................................................................44
Section 4.15. Subsidiaries, Significant Affiliates and Guarantors................................................44

                         Article V AFFIRMATIVE COVENANTS

Section 5.1. Financial Statements and Other Information..........................................................45
Section 5.2. Notices of Material Events..........................................................................46
Section 5.3. Existence; Conduct of Business......................................................................47
Section 5.4. Compliance with Laws, Etc...........................................................................47
Section 5.5. Payment of Obligations..............................................................................47
Section 5.6. Books and Records...................................................................................47
Section 5.7. Visitation, Inspection, Etc.........................................................................47
Section 5.8. Maintenance of Properties; Insurance................................................................48
Section 5.9. Use of Proceeds.....................................................................................48
Section 5.10. Additional Subsidiaries............................................................................48

                         Article VI FINANCIAL COVENANTS

Section 6.1. Leverage Ratio......................................................................................48
Section 6.2. Consolidated EBITDA to Consolidated Interest Expense................................................49
Section 6.3. Consolidated Net Worth..............................................................................49

                         Article VII NEGATIVE COVENANTS

Section 7.1. Indebtedness........................................................................................49
Section 7.2. Negative Pledge.....................................................................................50
Section 7.3. Fundamental Changes.................................................................................51
Section 7.4. Investments, Loans, Etc.............................................................................51
Section 7.5. Restricted Payments.................................................................................52
Section 7.6. Sale of Assets......................................................................................53
Section 7.7. Transactions with Affiliates........................................................................53
Section 7.8. Restrictive Agreements..............................................................................53
Section 7.9. Sale and Leaseback Transactions.....................................................................54
Section 7.10. Hedging Agreements.................................................................................54
Section 7.11. Amendment to Material Documents....................................................................54
Section 7.12. Accounting Changes.................................................................................54

                           Article VIII KPP GUARANTEe

Section 8.1. Guarantee...........................................................................................54
Section 8.2. Guaranteed Obligations Not Waived...................................................................55
Section 8.3. Guarantee of Payment................................................................................55
Section 8.4. No Discharge or Diminishment of Guarantee...........................................................56
Section 8.5. Defenses of Borrower Waived.........................................................................56
Section 8.6. Agreement to Pay; Subordination.....................................................................56
Section 8.7. Information.........................................................................................57
Section 8.8. Termination.........................................................................................57

                          Article IX EVENTS OF DEFAULT

Section 9.1. Events of Default...................................................................................57

                       Article X THE ADMINISTRATIVE AGENT

Section 10.1. Appointment of Administrative Agent................................................................60
Section 10.2. Nature of Duties of Administrative Agent...........................................................60
Section 10.3. Lack of Reliance on the Administrative Agent.......................................................61
Section 10.4. Certain Rights of the Administrative Agent.........................................................61
Section 10.5. Reliance by Administrative Agent...................................................................62
Section 10.6. The Administrative Agent in its Individual Capacity................................................62
Section 10.7. Successor Administrative Agent.....................................................................62
Section 10.8. Authorization to Execute other Loan Documents......................................................63

                            Article XI MISCELLANEOUS

Section 11.1. Notices............................................................................................63
Section 11.2. Waiver; Amendments.................................................................................65
Section 11.3. Expenses; Indemnification..........................................................................66
Section 11.4. Successors and Assigns.............................................................................67
Section 11.5. Governing Law; Jurisdiction; Consent to Service of Process.........................................70
Section 11.6. WAIVER OF JURY TRIAL...............................................................................70
Section 11.7. Right of Setoff....................................................................................71
Section 11.8. Counterparts; Integration..........................................................................71
Section 11.9. Survival...........................................................................................71
Section 11.10. Severability......................................................................................72
Section 11.11. Confidentiality...................................................................................72
Section 11.12. Interest Rate Limitation..........................................................................73
Section 11.13. Waiver of Effect of Corporate Seal................................................................73

</TABLE>

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Annex I   Commitments
------
<TABLE>
<CAPTION>
Schedules

<S>                                 <C>
       Schedule I           -       Applicable Margin and Applicable Commitment Fee Percentage
       Schedule II          -       Existing Indebtedness
       Schedule 4.5         -       Environmental Matters
       Schedule 4.15        -       Subsidiaries
       Schedule 7.1         -       Existing Subsidiary Indebtedness
       Schedule 7.2         -       Existing Liens


Exhibits

       Exhibit A            -       Form of Note
       Exhibit B            -       Form of Assignment and Acceptance
       Exhibit C            -       Form of Subsidiary Guarantee Agreement
       Exhibit D            -       Form of Notice of Borrowing
       Exhibit E            -       Form of Continuation/Conversion
       Exhibit F            -       Form of Opinion
       Exhibit G                    Form of Compliance Certificate

</TABLE>

<PAGE>
                           REVOLVING CREDIT AGREEMENT


     THIS REVOLVING CREDIT AGREEMENT (this "Agreement") is made and entered into
as of April __, 2003, by and among KANEB PIPE LINE OPERATING PARTNERSHIP,  L.P.,
a Delaware limited partnership (the "Borrower"), KANEB PIPE LINE PARTNERS, L.P.,
a  Delaware  limited  partnership   ("KPP"),   the  banks  and  other  financial
institutions  from time to time party hereto (the  "Lenders") and SUNTRUST BANK,
in its capacity as  administrative  agent for the Lenders  (the  "Administrative
Agent") and as issuing bank (the "Issuing Bank").


                              W I T N E S S E T H:

     WHEREAS,   the  Borrower  has  requested  that  the  Lenders   establish  a
$400,000,000 revolving credit facility in favor of the Borrower;

     WHEREAS,  subject to the terms and conditions of this Agreement (including,
without limitation,  the guaranty and other agreements of KPP set forth herein),
the Lenders and the Issuing Bank to the extent of their  respective  Commitments
as defined herein,  are willing  severally to establish the requested  revolving
credit facility and letter of credit subfacility in favor of the Borrower.

     NOW,  THEREFORE,  in consideration of the premises and the mutual covenants
herein  contained,  the  Borrower,  KPP, the  Lenders,  the Issuing Bank and the
Administrative Agent agree as follows:

Article I
                            DEFINITIONS; CONSTRUCTION
Section 1.1.      Definitions.

     In addition to the other terms defined  herein,  the  following  terms used
herein shall have the meanings  herein  specified  (to be equally  applicable to
both the singular and plural forms of the terms defined):

          "Adjusted LIBO Rate" shall mean,  with respect to each Interest Period
     for a  Eurodollar  Borrowing,  the rate per annum  obtained by dividing (i)
     LIBOR for such Interest Period by (ii) a percentage equal to 1.00 minus the
     Eurodollar Reserve Percentage.

          "Administrative Agent" shall have the meaning set forth in the opening
     paragraph hereof.

          "Administrative  Questionnaire"  shall  mean,  with  respect  to  each
     Lender,  an  administrative  questionnaire  in  the  form  prepared  by the
     Administrative  Agent  and  submitted  to  the  Administrative  Agent  duly
     completed by such Lender.

          "Affiliate"  shall  mean,  as to any  Person,  any other  Person  that
     directly,  or indirectly through one or more intermediaries,  Controls,  is
     Controlled  by, or is under  common  Control  with,  such  Person.  For the
     purposes of this  definition,  "Control" shall mean the power,  directly or
     indirectly,  either to (i) vote 5% or more of  securities  having  ordinary
     voting power for the election of directors (or persons  performing  similar
     functions)  of a Person  or (ii)  direct  or  cause  the  direction  of the
     management  and  policies  of a Person,  whether  through  the  ability  to
     exercise voting power, by contract or otherwise.  The terms "Controlled by"
     and "under common Control with" have meanings correlative thereto.

          "Aggregate Commitments" shall mean,  collectively,  all Commitments of
     all Lenders at any time outstanding.

          "Applicable Commitment Fee Percentage" shall mean, with respect to the
     commitment  fee, a  percentage  per annum  determined  by  reference to the
     applicable Reference Rating in effect on such date as set forth on Schedule
     I;  provided,  that a change in the  Applicable  Commitment  Fee Percentage
     resulting from a change in the Reference  Rating or Leverage Ratio shall be
     effective on the day on which either rating agency changes its rating or on
     the  third day  after  which  KPP is  required  to  deliver  the  financial
     statements required by Section 5.1(a) or (b) and the compliance certificate
     required by Section 5.1(c), as applicable, and shall continue until the day
     prior to the day that a further change becomes effective; provided, that if
     KPP shall have failed to deliver the financial  statements and  certificate
     described above, the Applicable Commitment Fee Percentage shall be based on
     the highest Leverage Ratio until such time as such financial statements and
     certificate  are  delivered,  at which time the  Applicable  Commitment Fee
     Percentage  shall be  determined  as provided  above.  Notwithstanding  the
     foregoing,  the Applicable  Commitment Fee Percentage from the Closing Date
     until further change in accordance herewith shall be 0.25% per annum.

          "Applicable  Lending  Office" shall mean, for each Lender and for each
     Type of Loan, the "Lending  Office" of such Lender (or an Affiliate of such
     Lender)   designated   for  such   Type  of  Loan  in  the   Administrative
     Questionnaire  submitted by such Lender or such other office of such Lender
     (or an  Affiliate  of such  Lender)  as such  Lender  may from time to time
     specify to the Administrative Agent and the Borrower as the office by which
     its Loans of such Type are to be made and maintained.

          "Applicable  Margin" shall mean,  as of any date,  with respect to all
     Loans  outstanding on any date or the letter of credit fee, as the case may
     be, the  percentage  per annum  determined  by reference to the  applicable
     Reference  Rating and Leverage Ratio in effect on such date as set forth on
     Schedule I; provided, that a change in the Applicable Margin resulting from
     a change in the  Reference  Rating or Leverage  Ratio shall be effective on
     the day on which either  rating  agency  changes its rating or on the third
     day  after  which KPP is  required  to  deliver  the  financial  statements
     required by Section 5.1(a) or (b) and the compliance  certificate  required
     by Section 5.1(c), as applicable, and shall continue until the day prior to
     the day that a further  change  becomes  effective;  provided,  that if KPP
     shall have  failed to deliver  the  financial  statements  and  certificate
     described  above,  the  Applicable  Margin  shall be  based on the  highest
     Leverage Ratio until such time as such financial statements and certificate
     are delivered,  at which time the Applicable  Margin shall be determined as
     provided above.  Notwithstanding the foregoing,  the Applicable Margin from
     the Closing  Date until  further  change in  accordance  herewith  shall be
     1.125% per annum with  respect to  Eurodollar  Loans and 0% with respect to
     Base Rate Loans.

          "Assignment  and  Acceptance"  shall mean an assignment and acceptance
     entered into by a Lender and an assignee (with the consent of any party the
     consent  of which is  required  by Section  11.4(b))  and  accepted  by the
     Administrative Agent, in the form of Exhibit B attached hereto or any other
     form approved by the Administrative Agent.

          "Base  Rate" shall mean the higher of (i) the per annum rate which the
     Administrative  Agent publicly  announces from time to time to be its prime
     lending  rate,  as in effect from time to time,  and (ii) the Federal Funds
     Rate as in effect from time to time plus  one-half of one percent  (0.50%).
     The Administrative  Agent's prime lending rate is a reference rate and does
     not necessarily represent the lowest or best rate charged to customers. The
     Administrative  Agent may make commercial  loans or other loans at rates of
     interest at, above or below the Administrative  Agent's prime lending rate.
     Each  change in the  Administrative  Agent's  prime  lending  rate shall be
     effective from and including the date such change is publicly  announced as
     being effective.

          "Borrower"  shall  have  the  meaning  in the  introductory  paragraph
     hereof.

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

          "Bridge Loan Agreement" shall mean that certain Bridge Loan Agreement,
     dated as of December 24, 2002, by and among the Borrower,  KPP, the lenders
     from time to time parties  thereto and  SunTrust  Bank,  as  Administrative
     Agent.

          "Business Day" shall mean (i) any day other than a Saturday, Sunday or
     other day on which commercial  banks in Atlanta,  Georgia and New York, New
     York  are  authorized  or  required  by law to  close  and (ii) if such day
     relates to a Borrowing of, a payment or prepayment of principal or interest
     on, a conversion of or into, or an Interest  Period for, a Eurodollar  Loan
     or a notice with respect to any of the foregoing, any day on which dealings
     in Dollars are carried on in the London interbank market.

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

          "Change in Control"  shall mean the  occurrence  of one or more of the
     following  events:  (i) any sale,  lease,  exchange or other transfer (in a
     single  transaction  or  a  series  of  related  transactions)  of  all  or
     substantially  all of the assets of KPP or the General Partner to any other
     Person or "group"  (within the meaning of the  Securities  Exchange  Act of
     1934 and the rules of the Securities and Exchange Commission  thereunder in
     effect on the date hereof), (ii) the acquisition of ownership,  directly or
     indirectly, beneficially or of record, by any Person or "group" (within the
     meaning  of the  Securities  Exchange  Act of  1934  and the  rules  of the
     Securities  and  Exchange  Commission  thereunder  as in effect on the date
     hereof)  (other than, in the case of the General  Partner,  by the Investor
     Group) of  sufficient  Equity  Interests  in KPP or the General  Partner to
     Control KPP or the General Partner, as the case may be; or (iii) occupation
     of a  majority  of the  seats  (other  than  vacant  seats) on the board of
     directors of the General  Partner by Persons who were neither (A) nominated
     by the  current  board  of  directors  or (B)  appointed  by  directors  so
     nominated.  For the purposes of this  definition,  "Control" shall mean the
     power, directly or indirectly, either to (i) vote 50% or more of securities
     having  ordinary  voting power for the  election of  directors  (or persons
     performing  similar  functions)  of a Person  or (ii)  direct  or cause the
     direction of the management and policies of a Person,  whether  through the
     ability to exercise  voting  power,  by contract  or  otherwise.  The terms
     "Controlled  by" and "under common Control with" have meanings  correlative
     thereto.

          "Change in Law" shall mean (i) the  adoption  of any  applicable  law,
     rule or regulation after the date of this Agreement, (ii) any change in any
     applicable law, rule or regulation,  or any change in the interpretation or
     application  thereof, by any Governmental  Authority after the date of this
     Agreement,  or (iii)  compliance by any Lender (or its  Applicable  Lending
     Office) or the Issuing  Bank (or for purposes of Section  2.19(b),  by such
     Lender's or the Issuing Bank's  holding  company,  if applicable)  with any
     request, guideline or directive (whether or not having the force of law) of
     any Governmental Authority made or issued after the date of this Agreement.

          "Charges" shall have the meaning set forth in Section 11.12.

          "Closing Date" shall mean the date on which the  conditions  precedent
     set forth in Section 3.1 have been  satisfied or waived in accordance  with
     Section 11.2.

          "Code" shall mean the Internal Revenue Code of 1986, as amended and in
     effect from time to time.

          "Commitment"  shall mean, with respect to each Lender,  the obligation
     of such Lender to make Loans to the Borrower and to  participate in Letters
     of Credit in an aggregate  principal  amount not  exceeding  the amount set
     forth with  respect to such Lender on Annex I, as such Annex may be amended
     pursuant to Section 2.21 or 11.4.

          "Compliance  Certificate"  shall mean a certificate from a Responsible
     Officer of the Borrower,  in the form of, and containing the certifications
     set forth in, the  certificate  attached  hereto as  Exhibit G,  including,
     without  limitation,  (i)  certifying  as to  whether a Default or Event of
     Default has occurred and is continuing on the date of such certificate, and
     if a Default or an Event of Default then has  occurred  and is  continuing,
     specifying  the details  thereof and the action that the Borrower has taken
     or proposes to take with respect thereto,  (ii) setting forth in reasonable
     detail calculations demonstrating compliance with Article VI, (iii) stating
     whether  any  change  in  GAAP or the  application  thereof  affecting  the
     calculations  described in clause (ii) above has occurred since the date of
     the audited financial  statements of KPP referred to in Section 4.4 and, if
     any  change  has  occurred,  specifying  the  effect of such  change on the
     financial  statements  accompanying  such  certificate,  (iv) the financial
     statements  fairly  represent,  in all  material  respects,  the  financial
     condition,  results of operations,  shareholders'  equity and cash flows of
     the KPP and its  Subsidiaries  in accordance with GAAP at such date and for
     such period,  subject only to normal  year-end  audit  adjustments  and the
     absence of footnotes in the case of unaudited financial  statements and (v)
     since the date of the  financial  statements  of KPP referred to in Section
     4.4, there has been no change which has had or could reasonably be expected
     to have a Material Adverse Effect.

          "Consolidated EBITDA" shall mean, for KPP and its Subsidiaries for any
     period,  an amount equal to the sum of (i) Consolidated Net Income for such
     period plus (ii) to the extent  deducted in  determining  Consolidated  Net
     Income for such period, (A) Consolidated  Interest Expense,  (B) income tax
     expense,  (C)  depreciation  and  amortization  and (D) all other  non-cash
     charges, determined on a consolidated basis in accordance with GAAP in each
     case for such period.

          "Consolidated   Interest   Expense"   shall  mean,  for  KPP  and  its
     Subsidiaries  for  any  period  determined  on  a  consolidated   basis  in
     accordance with GAAP, the sum of (i) total interest expense, (other than in
     respect of Permitted  Non-Recourse  Debt) including without  limitation the
     interest  component of any payments in respect of Capital Lease Obligations
     capitalized  or expensed  during such period  (whether or not actually paid
     during  such  period)  plus (ii) the net amount  payable  (or minus the net
     amount  receivable) under Hedging Agreements during such period (whether or
     not actually paid or received during such period).

          "Consolidated  Net Income" shall mean, for any period,  the sum of (i)
     the net  income  (or  loss) of KPP and its  Subsidiaries  for  such  period
     determined  on a  consolidated  basis  in  accordance  with  GAAP,  but (A)
     excluding  therefrom  (to the extent  otherwise  included  therein) (1) any
     extraordinary  gains or losses,  (2) any gains attributable to write-ups of
     assets,  (3) any equity  interest  of KPP or any  Subsidiary  of KPP in the
     unremitted  earnings of any Person that is not a  Subsidiary  other than ST
     Linden,  L.L.C.  and (4) any  income of any  Person  other  than KPP or the
     Borrower for such period if (x) such Person has any Permitted  Non-Recourse
     Indebtedness   outstanding  owing  to  any  Person  other  than  KPP  or  a
     wholly-owned  Subsidiary of KPP and (y) such income is not received in cash
     by KPP or the  Borrower,  as the case may be,  during such period,  and (B)
     including therein (to the extent not otherwise included therein) any income
     (or  loss) of any  Person or  attributable  to any  assets  if such  income
     accrued  prior to the date that (x) such Person  became a Subsidiary or was
     merged into or  consolidated  with KPP or any Subsidiary of KPP or (y) such
     assets  were  acquired by KPP or any  Subsidiary,  as the case may be, plus
     (ii)  the net  income  (or  loss) of the  General  Partner  in such  period
     attributable to the General Partner's interest in the Borrower,  determined
     in accordance with GAAP.

          "Consolidated  Net  Worth"  shall  mean as of any  date the sum of (x)
     total partners' capital of KPP and its consolidated Subsidiaries as at such
     date,  excluding  the effects of any write-ups  after  December 31, 2002 of
     assets  owned by KPP and its  consolidated  Subsidiaries  as of the date of
     this  Agreement plus (y) minority  interests of the General  Partner in the
     Borrower, in each case determined in accordance with GAAP.

          "Consolidated Total Debt" shall mean, as of any date of determination,
     all Indebtedness of KPP and its Subsidiaries, excluding Indebtedness of the
     type described in clause (xi) of the definition of Indebtedness.

          "Constituent  Documents" shall mean, for any Person, the documents for
     its formation and organization,  which, for example,  (i) for a corporation
     are its  corporate  charter  and  bylaws,  (ii)  for a  partnership  is its
     partnership  agreement,  (iii)  for a  limited  liability  company  are its
     certificate of organization  and  regulations,  and (iv) for a trust is the
     trust agreement or indenture under which it is created.

          "Credit  Exposure" shall mean, with respect to any Lender at any time,
     the sum of the outstanding  principal  amount of such Lender's Loans and LC
     Exposure.

          "Credit  Rating" of any Person shall mean the ratings  assigned by S&P
     and Moody's to the senior unsecured  non-credit  enhanced long-term debt of
     such  Person.  For  purposes  hereof,  if the  ratings  assigned by S&P and
     Moody's are not comparable  (i.e., a "split  rating"),  and (i) the ratings
     differential  is less than two levels,  then the higher of such two ratings
     shall control or (ii) the ratings  differential is two levels or more, then
     the ratings one below the higher of such two ratings shall control,  unless
     either  rating  is below  BBB- (in the case of S&P) or Baa3 (in the case of
     Moody's),  in which case the lower of the two ratings shall control. If the
     rating system of S&P or Moody's  shall  change,  or if either rating agency
     shall cease to be in the business of rating corporate debt obligations, the
     Borrower,  the Lenders and the Administrative Agent shall negotiate in good
     faith to amend this  Schedule to reflect such changed  rating system or the
     unavailability  of  ratings  from  such  rating  agency  and,  pending  the
     effectiveness  of  any  such  amendment,  the  Applicable  Margin  and  the
     Applicable  Commitment Fee  Percentage  shall be determined by reference to
     the Credit  Rating  most  recently  in effect  prior to any such  change or
     cessation.  If  after a  reasonable  time  the  parties  cannot  agree to a
     mutually  acceptable  amendment,  the Applicable  Margin and the Applicable
     Commitment Fee Percentage shall be determined by reference to Level IV.

          "Default"  shall mean any condition or event that,  with the giving of
     notice or the lapse of time or both, would constitute an Event of Default.

          "Default  Interest"  shall  have the  meaning  set  forth  in  Section
     2.10(b).

          "Distribution" shall mean, with respect to any Equity Interests issued
     by a Person (i) the retirement,  redemption,  purchase or other acquisition
     for value of those Equity Interests, (ii) the declaration or payment of any
     dividend or  distribution  on or with  respect to those  Equity  Interests,
     (iii) any  Investment  by that Person in the holder of any of those  Equity
     Interests,  and (iv) any other payment by that Person with respect to those
     Equity Interests.

          "Dollar(s)"  and the sign "$" shall  mean  lawful  money of the United
     States of America.

          "Environmental  Liability"  shall mean any  liability,  contingent  or
     otherwise  (including  any  liability for damages,  costs of  environmental
     investigation and remediation,  costs of administrative  oversight,  fines,
     natural  resource  damages,  penalties  or  indemnities),  of  KPP  or  any
     Subsidiary  directly  or  indirectly  resulting  from or based upon (i) any
     actual or alleged violation of any Environmental  Law, (ii) the generation,
     use,  handling,  transportation,  storage,  treatment  or  disposal  of any
     Hazardous Materials,  (iii) any actual or alleged exposure to any Hazardous
     Materials,  (iv)  the  Release  or  threatened  Release  of  any  Hazardous
     Materials or (v) any contract,  agreement or other  consensual  arrangement
     pursuant to which  liability  is assumed or imposed  with respect to any of
     the foregoing.

          "Equity Event" shall mean (i) the  contribution  in cash of capital to
     KPP or any Subsidiary of KPP by any Person other than KPP or a Wholly-Owned
     Subsidiary of KPP or any  Subsidiary of KPP, or (ii) any issuance of Equity
     Interests by KPP or any  Subsidiary  of KPP to any Person other than KPP or
     any Subsidiary of KPP or a Wholly-Owned Subsidiary of KPP.

          "Equity  Interests"  shall mean,  (i) with  respect to a  corporation,
     shares  of  capital  stock  of  such  corporation  or  any  other  interest
     convertible or exchangeable into any such interest,  (ii) with respect to a
     limited liability  company,  a membership  interest in such company,  (iii)
     with respect to a partnership,  a partnership interest in such partnership,
     and (iv) with  respect to any other  Person,  an  interest  in such  Person
     analogous to interests described in clauses (i) through (iii).

          "ERISA"  shall mean the  Employee  Retirement  Income  Security Act of
     1974, as amended from time to time, and any successor statute.

          "ERISA  Affiliate"  shall mean any trade or  business  (whether or not
     incorporated),  which,  together with KPP, is treated as a single  employer
     under  Section  414(b) or (c) of the Code or,  solely for the  purposes  of
     Section 302 of ERISA and  Section  412 of the Code,  is treated as a single
     employer under Section 414 of the Code.

          "ERISA  Event" shall mean (i) any  "reportable  event",  as defined in
     Section 4043 of ERISA or the regulations  issued thereunder with respect to
     a Plan (other than an event for which the 30-day  notice period is waived);
     (ii) the  existence  with  respect to any Plan of an  "accumulated  funding
     deficiency"  (as  defined  in  Section  412 of the Code or  Section  302 of
     ERISA),  whether or not waived; (iii) the filing pursuant to Section 412(d)
     of the Code or Section  303(d) of ERISA of an  application  for a waiver of
     the minimum funding  standard with respect to any Plan; (iv) the incurrence
     by KPP or any of its ERISA  Affiliates of any  liability  under Title IV of
     ERISA with respect to the  termination  of any Plan; (v) the receipt by KPP
     or any ERISA Affiliate from the PBGC or a plan  administrator  appointed by
     the PBGC of any notice  relating to an intention  to terminate  any Plan or
     Plans or to appoint a trustee to administer  any Plan;  (vi) the incurrence
     by KPP or any of its ERISA  Affiliates of any liability with respect to the
     withdrawal or partial  withdrawal from any Plan or  Multiemployer  Plan; or
     (vii) the  receipt  by KPP or any ERISA  Affiliate  of any  notice,  or the
     receipt by any  Multiemployer  Plan from KPP or any ERISA  Affiliate of any
     notice,   concerning   the   imposition  of   Withdrawal   Liability  or  a
     determination that a Multiemployer Plan is, or is expected to be, insolvent
     or in reorganization, within the meaning of Title IV of ERISA.

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

          "Eurodollar  Reserve  Percentage"  shall  mean  the  aggregate  of the
     maximum reserve percentages (including,  without limitation, any emergency,
     supplemental,  special or other marginal  reserves)  expressed as a decimal
     (rounded  upwards to the next  1/100th of 1%) in effect on any day to which
     the Administrative  Agent is subject with respect to the Adjusted LIBO Rate
     pursuant to  regulations  issued by the Board of  Governors  of the Federal
     Reserve  System (or any  Governmental  Authority  succeeding  to any of its
     principal  functions)  with  respect  to  eurocurrency  funding  (currently
     referred to as "eurocurrency  liabilities"  under Regulation D). Eurodollar
     Loans shall be deemed to constitute  eurocurrency funding and to be subject
     to such reserve  requirements  without  benefit of or credit for proration,
     exemptions or offsets that may be available from time to time to any Lender
     under  Regulation D. The Eurodollar  Reserve  Percentage  shall be adjusted
     automatically  on and as of the effective date of any change in any reserve
     percentage.

          "Event of Default" shall have the meaning set forth in Article IX.

          "Excluded  Affiliate" shall mean, for any Person (the "first Person"),
     any other  Person  (the  "second  Person")  in which the first  Person owns
     Equity Interests and where the second Person (i) has no Indebtedness  other
     than Permitted  Non-Recourse  Debt and (ii) the sole purpose of which is to
     engage  in the  acquisition,  construction,  development  and/or  operation
     activities financed or refinanced with such Permitted Non-Recourse Debt.

          "Excluded  Subsidiary"  shall  mean any  Subsidiary  of KPP that is an
     Excluded Affiliate.

          "Excluded Taxes" shall mean with respect to the Administrative  Agent,
     any Lender,  the Issuing  Bank or any other  recipient of any payment to be
     made by or on account of any  obligation  of the  Borrower  hereunder,  (i)
     income or franchise taxes imposed on (or measured by) its net income by the
     United States of America,  or by the  jurisdiction  under the laws of which
     such recipient is organized or in which its principal office is located or,
     in the case of any  Lender,  in which  its  applicable  lending  office  is
     located,  (ii) any branch  profits  taxes  imposed by the United  States of
     America or any similar tax imposed by any other  jurisdiction  in which any
     Lender  is  located  and  (iii)  in  the  case  of a  Foreign  Lender,  any
     withholding  tax that (A) is  imposed on  amounts  payable to such  Foreign
     Lender at the time such Foreign Lender  becomes a party to this  Agreement,
     (B) is imposed on amounts  payable to such Foreign  Lender at any time that
     such Foreign Lender designates a new lending office,  other than taxes that
     have  accrued  prior to the  designation  of such  lending  office that are
     otherwise  not  Excluded  Taxes,  and (C) is  attributable  to such Foreign
     Lender's failure to comply with Section 2.17(e).

          "Existing  Indebtedness"  shall  mean the  Indebtedness  described  on
     Schedule II of this Agreement.

          "Existing   Revolving  Credit   Agreement"  shall  mean  that  certain
     Revolving Credit Agreement, dated as of December 28, 2000, by and among the
     Borrower,  KPP, the lenders from time to time parties  thereto and SunTrust
     Bank, as Administrative Agent.

          "Fair Market Value" shall mean, with respect to any Equity Interest or
     other property or asset,  the price  obtainable for such Equity Interest or
     other  property or asset in an  arm's-length  sale  between an informed and
     willing  purchaser  under no  compulsion  to purchase  and an informed  and
     willing seller under no compulsion to sell.

          "Fee  Letters"  shall mean (i) that certain  letter  agreement,  dated
     March 13, 2003,  between the Borrower and  SunTrust  Robinson  Humphrey,  a
     division of SunTrust  Capital Markets,  Inc.,  relating to certain fees and
     expenses  payable in connection  with this  Agreement and (ii) that certain
     letter agreement,  dated as of March 13, 2003 between the Borrower and Banc
     One Capital Markets, Inc., relating to certain fees and expenses payable in
     connection with this Agreement.

          "Federal  Funds  Rate"  shall  mean,  for any day,  the rate per annum
     (rounded  upwards,  if  necessary,  to the next 1/100th of 1%) equal to the
     weighted average of the rates on overnight Federal funds  transactions with
     member  banks of the  Federal  Reserve  System  arranged  by Federal  funds
     brokers,  as published by the Federal  Reserve Bank of New York on the next
     succeeding  Business  Day or if  such  rate  is not so  published  for  any
     Business  Day,  the  Federal  Funds Rate for such day shall be the  average
     rounded upwards, if necessary,  to the next 1/100th of 1% of the quotations
     for such day on such transactions received by the Administrative Agent from
     three  Federal  funds  brokers  of  recognized  standing  selected  by  the
     Administrative Agent.

          "Foreign  Lender"  shall mean any Lender  that is not a United  States
     Person under Section 7701(a)(3) of the Code.

          "Foreign  Subsidiary"  shall  mean any  Subsidiary  of KPP that is not
     organized  under the law of the  United  States of  America or any state or
     territory thereof.

          "GAAP" shall mean  generally  accepted  accounting  principles  in the
     United  States  applied on a  consistent  basis and subject to the terms of
     Section 1.3.

          "General  Partner"  shall mean Kaneb Pipe Line Company LLC, a Delaware
     limited liability company.

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

          "Granting Lender" shall have the meaning set forth in Section 11.4(e).

          "Guarantee"  of or by any  Person  (the  "guarantor")  shall  mean any
     obligation,  contingent or  otherwise,  of the  guarantor  guaranteeing  or
     having the economic  effect of guaranteeing  any  Indebtedness of any other
     Person  (the  "primary  obligor")  in  any  manner,   whether  directly  or
     indirectly,  and  including  any  obligation,  direct or  indirect,  of the
     guarantor  (i) to  purchase  or pay (or  advance  or  supply  funds for the
     purchase  or  payment  of)  such  Indebtedness  or other  obligation  or to
     purchase  (or to advance or supply  funds for the purchase of) any security
     for the payment thereof, (ii) to purchase or lease property,  securities or
     services  for the purpose of  assuring  the owner of such  Indebtedness  or
     other obligation of the payment thereof, (iii) to maintain working capital,
     equity capital or any other financial  statement  condition or liquidity of
     the  primary  obligor  so as to  enable  the  primary  obligor  to pay such
     Indebtedness or other  obligation or (iv) as an account party in respect of
     any  letter  of credit or letter  of  guaranty  issued in  support  of such
     Indebtedness or obligation;  provided,  that the term "Guarantee" shall not
     include  endorsements  for collection or deposits in the ordinary course of
     business. The amount of any Guarantee shall be deemed to be an amount equal
     to the stated or determinable  amount of the primary  obligation in respect
     of which  Guarantee  is made or,  if not so  stated  or  determinable,  the
     maximum reasonably  anticipated liability in respect thereof (assuming such
     Person is required to perform  thereunder)  as determined by such Person in
     good  faith.  The  term  "Guarantee"  used  as a verb  has a  corresponding
     meaning.

          "Guaranteed  Obligations"  shall have the meaning set forth in Section
     8.01.

          "Guarantor" shall mean KPP and each party to the Subsidiary  Guarantee
     Agreement.

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

          "Hedging  Agreements"  shall mean  interest  rate swap,  cap or collar
     agreements,  interest  rate  future  or  option  contracts,  currency  swap
     agreements,  currency future or option contracts,  commodity agreements and
     other  similar  agreements  or  arrangements  designed  to protect  against
     fluctuations in interest rates,  currency  values or commodity  values,  in
     each case to which KPP or any Subsidiary of KPP is a party.

          "Indebtedness" of any Person shall mean, without duplication,  (i) all
     obligations of such Person for borrowed money, (ii) all obligations of such
     Person evidenced by bonds, debentures,  notes or other similar instruments,
     (iii) all  obligations  of such Person in respect of the deferred  purchase
     price of property or services  (other than trade  payables  incurred in the
     ordinary course of business;  provided, that for purposes of Section 9.1(f)
     trade  payables  overdue  by more than 120 days shall be  included  in this
     definition  except to the extent that any of such trade  payables are being
     disputed in good faith and by appropriate  measures),  (iv) all obligations
     of such  Person  under  any  conditional  sale  or  other  title  retention
     agreement(s)  relating to property acquired by such Person, (v) all Capital
     Lease  Obligations  of such  Person and all  obligations  in respect of the
     unpaid  principal  amount or component of all  obligations  under Synthetic
     Leases,  (vi) all obligations,  contingent or otherwise,  of such Person in
     respect of letters of credit,  acceptances or similar extensions of credit,
     (vii) all Guarantees of such Person of the type of  Indebtedness  described
     in clauses (i) through (v) above,  (viii) all Indebtedness of a third party
     secured by any Lien on property  owned by such Person,  whether or not such
     Indebtedness has been assumed by such Person,  (ix) all obligations of such
     Person,  contingent or otherwise, to purchase,  redeem, retire or otherwise
     acquire  for value any common  stock of such  Person,  (x) all  Off-Balance
     Sheet  Liabilities,  and (xi) all obligations under any Hedging  Agreement.
     The  Indebtedness  of any Person  shall  include  the  Indebtedness  of any
     partnership or joint venture in which such Person is a general partner or a
     joint  venturer,  except to the extent that the terms of such  Indebtedness
     provide that such Person is not liable therefor.

          "Indemnified Taxes" shall mean Taxes other than Excluded Taxes.

          "Indemnitee" shall have the meaning set forth in Section 11.3(b).

          "Information  Memorandum"  shall  mean  the  Confidential  Information
     Memorandum  dated  March  2003,  relating  to  KPP,  the  Borrower  and the
     transactions contemplated by this Agreement and the other Loan Documents.

          "Interest   Coverage   Ratio"  shall  mean  for  any  period  of  four
     consecutive  fiscal quarters of KPP, the ratio of (i)  Consolidated  EBITDA
     for such period to (ii) Consolidated Interest Expense for such period.

          "Interest Period" shall mean with respect to any Eurodollar Borrowing,
     a period of one, two, three or six months; provided, that:

               (i) the initial Interest Period for such Borrowing shall commence
          on the date of such  Borrowing  (including  the date of any conversion
          from a Borrowing of another Type),  and each Interest Period occurring
          thereafter in respect of such  Borrowing  shall commence on the day on
          which the next preceding Interest Period expires;

               (ii) if any Interest  Period would  otherwise  end on a day other
          than a Business  Day,  such  Interest  Period shall be extended to the
          next  succeeding  Business  Day,  unless  such  Business  Day falls in
          another  calendar  month, in which case such Interest Period would end
          on the next preceding Business Day;

               (iii) any Interest Period that begins on the last Business Day of
          a  calendar  month  (or on a day for  which  there  is no  numerically
          corresponding  day in the calendar  month at the end of such  Interest
          Period) shall end on the last Business Day of a calendar month;

               (iv) no Interest Period may extend beyond the Termination Date.

          "Investment" shall mean, in respect of any Person, any loan,  advance,
     extension  of credit or  capital  contribution  to that  Person,  any other
     investment  in that Person,  or any purchase or  commitment to purchase any
     Equity Interest or Indebtedness  issued by that Person or substantially all
     of the assets or a division or other business unit of that Person.

          "Investor Group" shall mean Kaneb Services, LLC and its Subsidiaries.

          "Issuing  Bank" shall mean  SunTrust Bank or any other Lender that has
     agreed to issue  Letters of Credit,  each in its  capacity  as an issuer of
     Letters of Credit pursuant to Section 2.19.

          "LC Commitment"  shall mean that portion of the Aggregate  Commitments
     that may be used by the  Borrower  for the issuance of Letters of Credit in
     an aggregate face amount not to exceed $50,000,000.

          "LC  Disbursement"  shall  mean a  payment  made by the  Issuing  Bank
     pursuant to a Letter of Credit.

          "LC Documents" shall mean the Letters of Credit and all  applications,
     agreements and instruments relating to the Letters of Credit.

          "LC Exposure"  shall mean,  at any time,  the sum of (i) the aggregate
     undrawn amount of all outstanding Letters of Credit at such time, plus (ii)
     the aggregate amount of all LC Disbursements  that have not been reimbursed
     by or on behalf of the Borrower at such time. The LC Exposure of any Lender
     shall be its Pro Rata Share of the total LC Exposure at such time.

          "Lenders"  shall  have  the  meaning  set  forth  in the  introductory
     paragraph  hereof and shall include,  where  appropriate,  each  additional
     Lender that joins this Agreement pursuant to Sections 2.21 or 11.4.

          "Letter of Credit"  shall mean any  stand-by  letter of credit  issued
     pursuant  to  Section  2.19 by the  Issuing  Bank  for the  account  of the
     Borrower pursuant to the LC Commitment.

          "Leverage  Ratio"  shall  mean,  as of  any  date,  the  ratio  of (i)
     Consolidated Total Debt as of such date to (ii) Consolidated EBITDA for the
     four  consecutive  Fiscal Quarters  ending on or immediately  prior to such
     date.

          "LIBOR" shall mean, for any applicable Interest Period with respect to
     any Eurodollar Loan, the British Bankers'  Association  Interest Settlement
     Rate per annum for deposits in Dollars for a period equal to such  Interest
     Period  appearing on the display  designated  as Page 3750 on the Dow Jones
     Markets  Service (or such other page on that service or such other  service
     designated  by the  British  Bankers'  Association  for the display of such
     Association's  Interest  Settlement  Rates for Dollar deposits) as of 11:00
     a.m.  (London,  England time) on the day that is two Business Days prior to
     the first day of the  Interest  Period or if such Page 3750 is  unavailable
     for any reason at such time,  the rate which appears on the Reuters  Screen
     ISDA  Page  as  of  such  date  and  such  time;  provided,   that  if  the
     Administrative  Agent  determines that the relevant  foregoing  sources are
     unavailable for the relevant Interest Period,  LIBOR shall mean the rate of
     interest determined by the Administrative  Agent to be the average (rounded
     upward, if necessary,  to the nearest 1/100th of 1%) of the rates per annum
     at which  deposits in Dollars are offered to the  Administrative  Agent two
     (2)  Business  Days  preceding  the  first day of such  Interest  Period by
     leading  banks in the London  interbank  market as of 10:00 a.m.  (New York
     time) for delivery on the first day of such Interest Period, for the number
     of days comprised  therein and in an amount comparable to the amount of the
     Eurodollar Loan of the Administrative Agent.

          "Lien" shall mean any mortgage,  pledge, security interest,  financing
     statement,   lien   (statutory   or   otherwise),    charge,   encumbrance,
     hypothecation, assignment, deposit arrangement, or other arrangement having
     the practical effect of the foregoing or any preference,  priority or other
     security  agreement  or  preferential  arrangement  of any  kind or  nature
     whatsoever  (including  any  conditional  sale  or  other  title  retention
     agreement and any capital  lease having the same economic  effect as any of
     the foregoing).

          "Loan"  shall mean a loan made by a Lender to the  Borrower  under its
     Commitment, which may either be a Base Rate Loan or a Eurodollar Loan.

          "Loan Documents" shall mean,  collectively,  this Agreement, the Notes
     (if any), the Subsidiary Guarantee Agreement, the LC Documents, all Notices
     of Borrowing, all Notices of Conversion/Continuation  and any and all other
     instruments, agreements, documents and writings executed in connection with
     any of the foregoing.

          "Loan Parties" shall mean the Borrower and the Guarantors.

          "Material  Adverse Effect" shall mean, with respect to any event, act,
     condition  or  occurrence  of  whatever   nature   (including  any  adverse
     determination in any litigation, arbitration, or governmental investigation
     or proceeding),  whether  singularly or in conjunction with any other event
     or events, act or acts, condition or conditions,  occurrence or occurrences
     whether or not related, a material adverse change in, or a material adverse
     effect on, (i) the business,  results of operations,  financial  condition,
     assets,  liabilities  or  prospects  of  the  Borrower  or of KPP  and  its
     Subsidiaries  taken  as a  whole,  (ii) the  ability  of any Loan  Party to
     perform any of its obligations  under the Loan Documents,  (iii) the rights
     and remedies of the Administrative  Agent, the Issuing Bank and the Lenders
     under  any  of the  Loan  Documents  or  (iv)  the  legality,  validity  or
     enforceability of any of the Loan Documents.

          "Material Indebtedness" shall mean Indebtedness (other than the Loans)
     or obligations  in respect of one or more Hedging  Agreements of any one or
     more of KPP and its Subsidiaries in an aggregate principal amount exceeding
     $10,000,000.  For  purposes  of  determining  Material  Indebtedness,   the
     "principal  amount" of the  obligations  of KPP or any Subsidiary of KPP in
     respect to any Hedging Agreement at any time shall be the maximum aggregate
     amount  (giving  effect  to  any  netting  agreements)  that  KPP  or  such
     Subsidiary  would  be  required  to  pay if  such  Hedging  Agreement  were
     terminated at such time.

          "Maximum Rate" shall have the meaning set forth in Section 11.12.

          "Moody's" shall mean Moody's Investors Service, Inc.

          "Multiemployer  Plan"  shall  have the  meaning  set forth in  Section
     4001(a)(3) of ERISA.

          "Net Cash Proceeds"  shall mean,  with respect to any sale,  transfer,
     conveyance,  lease  or  other  disposition  (including  by way  of  merger,
     consolidation  or  sale-leaseback)  of any assets of KPP or any Significant
     Affiliate (including,  without limitation, any Equity Interest owned by KPP
     or such Significant  Affiliate),  the aggregate amount of cash received, as
     the  case  may  be,  by (x)  KPP or the  Borrower  or (y)  any  Significant
     Affiliate and legally available to be distributed to KPP or the Borrower in
     the form of dividends or  distributions in connection with such transaction
     after,  in each case,  deducting  therefrom (i) payments made in respect of
     any  Indebtedness  to the extent that such payments are required to be made
     (other than under the Loan  Documents) as a result of or in connection with
     such  transaction  by  applicable  law or  the  terms  of  any  contractual
     agreement  relating to such  Indebtedness,  (ii)  reasonable  and customary
     transaction  costs,  and (iii) the  amount of taxes  paid or  reserved  for
     payment by KPP or such  Significant  Affiliate in  connection  with or as a
     result of such transaction.

          "Non-Recourse"  shall mean,  with  respect to any Person as applied to
     any Indebtedness (i) that such Person is not directly or indirectly  liable
     to make any  payments  with  respect to such  Indebtedness,  (ii) that such
     Indebtedness (or portion thereof) does not constitute  Indebtedness of such
     Person  other  than to the  extent  of  recourse  to such  Person's  Equity
     Interests  in the Person  primarily  incurring  such  Indebtedness  (or any
     shareholder,  partner, member or participant of such Person) and that (iii)
     such  Indebtedness  (or  portion  thereof)  is not secured by a Lien on any
     asset of such  Person  other than such  Person's  Equity  Interests  in the
     Person primarily  incurring such Indebtedness or any shareholder,  partner,
     member,  participant or other owner, directly or indirectly, of such Person
     or the Person the obligations of which were guaranteed.

          "Note"  shall mean a promissory  note of the  Borrower  payable to the
     order of a  requesting  Lender in the  principal  amount  of such  Lender's
     commitment, in substantially the form of Exhibit A.

          "Notice of Borrowing" shall have the meaning set forth in Section 2.3.

          "Notice of Conversion/Continuation" shall mean the notice given by the
     Borrower  to the  Administrative  Agent in  respect  of the  conversion  or
     continuation  of an  outstanding  Borrowing  as provided in Section  2.5(b)
     hereof.

          "Obligations"  shall mean all  amounts  owing by the  Borrower  to the
     Administrative  Agent,  the  Issuing  Bank or any Lender  pursuant to or in
     connection  with this  Agreement  or any  other  Loan  Document,  including
     without  limitation,  all  principal,   interest  (including  any  interest
     accruing after the filing of any petition in bankruptcy or the commencement
     of any  insolvency,  reorganization  or  like  proceeding  relating  to the
     Borrower,  whether or not a claim for post-filing or post-petition interest
     is  allowed  in such  proceeding),  all  reimbursement  obligations,  fees,
     expenses,  indemnification and reimbursement  payments,  costs and expenses
     (including  all fees and expenses of counsel to the  Administrative  Agent,
     the Issuing Bank and any Lender incurred  pursuant to this Agreement or any
     other Loan Document),  whether direct or indirect,  absolute or contingent,
     liquidated or unliquidated,  now existing or hereafter arising hereunder or
     thereunder,  and all obligations  arising under Hedging Agreements owing to
     the Administrative Agent, any Lender or any of their Affiliates relating to
     the foregoing to the extent  permitted  hereunder,  and all obligations and
     liabilities  incurred in  connection  with  collecting  and  enforcing  the
     foregoing,  together  with  all  renewals,  extensions,   modifications  or
     refinancings thereof.

          "Off-Balance  Sheet  Liabilities"  of any  Person  shall  mean (i) any
     repurchase  obligation or liability of such Person with respect to accounts
     or notes receivable sold by such Person,  (ii) any liability of such Person
     under any sale and leaseback transactions that do not create a liability on
     the  balance  sheet of such  Person or (iii) any  obligation  arising  with
     respect to any other transaction  which is the functional  equivalent of or
     takes the place of  borrowing  but that does not  constitute a liability on
     the balance sheet of such Person.

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

          "Participant" shall have the meaning set forth in Section 11.4(c).

          "Payment  Office"  shall mean the office of the  Administrative  Agent
     located at 25 Park  Place,  N.E.,  Atlanta,  Georgia  30303,  or such other
     location  as to which the  Administrative  Agent  shall have given  written
     notice to the Borrower and the other Lenders.

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

          "Permitted Encumbrances" shall mean

               (i) Liens imposed by law for taxes not yet due or which are being
          contested in good faith by appropriate proceedings and with respect to
          which adequate reserves are being maintained in accordance with GAAP;

               (ii)  statutory   Liens  of  landlords  and  Liens  of  carriers,
          warehousemen,  mechanics,  materialmen  and  other  Liens  arising  by
          operation  of law in the  ordinary  course of business for amounts not
          yet due or which  are being  contested  in good  faith by  appropriate
          proceedings  and with  respect to which  adequate  reserves  are being
          maintained in accordance with GAAP;

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

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

               (v) easements,  zoning  restrictions,  rights-of-way  and similar
          encumbrances  on  real  property  imposed  by  law or  arising  in the
          ordinary   course  of  business   that  do  not  secure  any  monetary
          obligations  and do not  materially  detract  from  the  value  of the
          affected property or materially interfere with the ordinary conduct of
          business of the Borrower and its Subsidiaries taken as a whole; and

               (vi) Liens granted in favor of the  Administrative  Agent for the
          benefit of the Lenders.

          "Permitted Investments" shall mean:

               (i) direct  obligations  of, or obligations  the principal of and
          interest on which are unconditionally guaranteed by, the United States
          (or by any agency thereof to the extent such obligations are backed by
          the full faith and credit of the United States), in each case maturing
          within one year from the date of acquisition thereof;

               (ii) commercial  paper having the highest rating,  at the time of
          acquisition  thereof,  of S&P or Moody's and in either  case  maturing
          within six months from the date of acquisition thereof;

               (iii)  certificates  of deposit,  bankers'  acceptances  and time
          deposits  maturing within 180 days of the date of acquisition  thereof
          issued or  guaranteed  by or placed  with,  and money  market  deposit
          accounts  issued or offered by, any domestic  office of any commercial
          bank  organized  under  the laws of the  United  States  or any  state
          thereof which has a combined capital and surplus and undivided profits
          of not less than $500,000,000;

               (iv) fully  collateralized  repurchase  agreements with a term of
          not more than 30 days for securities described in clause (i) above and
          entered  into with a financial  institution  satisfying  the  criteria
          described in clause (iii) above; and

               (v)  mutual  funds  investing  solely  in any  one or more of the
          Permitted Investments described in clauses (i) through (iv) above.

          "Permitted  Non-Recourse  Debt" shall mean  Indebtedness of any Person
     (other than any Loan Party) that is  Non-Recourse  to any Loan Party and is
     used by such Person to acquire,  construct,  develop  and/or operate assets
     not owned by KPP or any  Significant  Affiliate as of the date hereof or to
     refinance other Permitted Non-Recourse Debt.

          "Person" shall mean any individual,  partnership,  firm,  corporation,
     association,  joint  venture,  limited  liability  company,  trust or other
     entity, or any Governmental Authority.

          "Plan"  shall mean any  employee  pension  benefit  plan (other than a
     Multiemployer  Plan)  subject  to the  provisions  of  Title IV of ERISA or
     Section  412 of the Code or Section  302 of ERISA,  and in respect of which
     KPP or any ERISA  Affiliate  is (or,  if such plan were  terminated,  would
     under  Section 4069 of ERISA be deemed to be) an  "employer"  as defined in
     Section  3(5) of ERISA.  "Pro Rata  Share"  shall mean with  respect to any
     Commitment of any Lender at any time, and all Loans,  other Credit Exposure
     or any payments or prepayments related thereto, a percentage, the numerator
     of which shall be such Lender's  Commitment  (or if such  Commitments  have
     been  terminated  or expired or the Loans have been  declared to be due and
     payable, such Lender's Credit Exposure), and the denominator of which shall
     be the sum of such  Commitments of all Lenders (or if such Commitments have
     been  terminated  or expired or the Loans have been  declared to be due and
     payable, the sum of the Credit Exposures of all Lenders).

          "Reference Parties" shall mean KPP and the Borrower.

          "Reference  Ratings"  shall mean the Credit  Ratings of the  Reference
     Party with the lowest Credit Rating.

          "Regulation  D" shall mean  Regulation  D of the Board of Governors of
     the Federal Reserve System, as the same may be in effect from time to time,
     and any successor regulations.

          "Regulation  U" shall mean  Regulation  U of the Board of Governors of
     the Federal Reserve System, as the same may be in effect from time to time,
     and any successor regulations.

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

          "Release" shall mean any release, spill, emission,  leaking,  dumping,
     injection,  pouring, deposit, disposal,  discharge,  dispersal, leaching or
     migration  into the  environment  (including  ambient air,  surface  water,
     groundwater,  land surface or  subsurface  strata) or within any  building,
     structure, facility or fixture.

          "Required  Lenders" shall mean, at any time, Lenders holding more than
     51% of the aggregate  outstanding Credit Exposure and unused Commitments at
     such time or if the Lenders have no Loans or Letters of Credit outstanding,
     then Lenders holding more than 51% of the Commitments.

          "Requirement  of Law"  for any  Person  shall  mean  the  articles  or
     certificate  of   incorporation,   bylaws,   partnership   certificate  and
     agreement,  or limited  liability  company  certificate of organization and
     agreement,  as the case may be,  and  other  organizational  and  governing
     documents of such  Person,  and any law,  treaty,  rule or  regulation,  or
     determination  of a Governmental  Authority,  in each case applicable to or
     binding  upon such Person or any of its property or to which such Person or
     any of its property is subject.

          "Responsible  Officer" shall mean, with respect to any Person,  any of
     the president,  the chief executive  officer,  the chief operating officer,
     the chief  financial  officer,  the  treasurer or a vice  president of such
     Person or such other  representative of such Person as may be designated in
     writing by any one of the foregoing with the consent of the  Administrative
     Agent.

          "Restricted Payment" shall have the meaning set forth in Section 7.5.

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

          "SPV" shall have the meaning set forth in Section 11.4(c).

          "Significant  Affiliate"  shall mean each  Person  (i) in which  KPP's
     direct and indirect  Investments in such Person constitute more than 10% of
     the total assets of KPP and its  consolidated  Subsidiaries,  (ii) in which
     KPP's and its Subsidiaries'  share of the total assets (after  intercompany
     eliminations)  of such Person exceed 10% of the total assets of KPP and its
     consolidated  Subsidiaries,  or (iii) in which  the  equity  of KPP and its
     Subsidiaries in the income from continuing operations of such Person before
     income  taxes,  extraordinary  items and  cumulative  effects of changes in
     accounting   principles   exceeds  10%  of  such  income  of  KPP  and  its
     consolidated Subsidiaries.

          "Significant  Subsidiary"  shall mean any  Subsidiary of KPP that is a
     Significant Affiliate.

          "Senior Notes Indenture" shall mean that certain  Indenture,  dated on
     or about  February 21, 2002,  between the Borrower and JPMorgan Chase Bank,
     as trustee,  with respect to the issuance of the  Borrower's  7.750% Senior
     Unsecured Notes due 2012.

          "Subsidiary"  shall mean,  with respect to any Person (the  "parent"),
     any corporation,  partnership,  joint venture,  limited liability  company,
     association  or other  entity the  accounts of which would be  consolidated
     with those of the parent in the parent's consolidated  financial statements
     if such financial  statements  were prepared in accordance  with GAAP as of
     such date, as well as any other  corporation,  partnership,  joint venture,
     limited  liability  company,  association  or  other  entity  (i) of  which
     securities or other ownership  interests  representing more than 50% of the
     equity or more than 50% of the ordinary  voting power,  or in the case of a
     partnership,  more than 50% of the general partnership interests are, as of
     such date,  owned,  Controlled  or held,  or (ii) that is, as of such date,
     otherwise  Controlled,  by the  parent or one or more  subsidiaries  of the
     parent or by the parent and one or more subsidiaries of the parent.  Unless
     otherwise indicated,  all references to "Subsidiary" hereunder shall mean a
     Subsidiary of KPP, and shall include, without limitation, the Borrower.

          "Subsidiary  Guarantee  Agreement" shall mean the Subsidiary Guarantee
     Agreement,  substantially  in the form of Exhibit C, made by the Guarantors
     (other  than KPP) in favor of the  Administrative  Agent for the benefit of
     the Lenders.

          "Synthetic  Lease"  shall  mean a lease  transaction  under  which the
     parties  intend that (i) the lease will be treated as an "operating  lease"
     by the lessee pursuant to Statement of Financial  Accounting  Standards No.
     13, as amended  and (ii) the lessee  will be  entitled  to various  tax and
     other  benefits  ordinarily  available to owners (as opposed to lessees) of
     like property.

          "Synthetic Lease  Obligations" shall mean, with respect to any Person,
     the sum of (i) all remaining  rental  obligations  of such Person as lessee
     under Synthetic  Leases which are  attributable  to principal and,  without
     duplication, (ii) all rental and purchase price payment obligations of such
     Person under such  Synthetic  Leases  assuming  such Person  exercises  the
     option to purchase the lease property at the end of the lease term.

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

          "Termination Date" shall mean the earliest of (i) the date three years
     from the date of this Agreement, (ii) the date on which the Commitments are
     terminated  pursuant to Section 2.6 and (iii) the date on which all amounts
     outstanding  under this Agreement have been declared or have  automatically
     become due and payable (whether by acceleration or otherwise).

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

          "Wholly-Owned  Subsidiary" shall mean any Subsidiary of a Person,  all
     of the issued and  outstanding  Equity  Interests  of which are directly or
     indirectly  owned  by  such  Person,  excluding  (i)  any  general  partner
     interests  owned by the General  Partner in any such  Subsidiary  that is a
     partnership  and (ii) any directors'  qualifying  shares or similar type of
     Equity Interests, as applicable.

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

Section 1.2. Classifications of Loans and Borrowings.

     For purposes of this Agreement,  Loans may be classified and referred to by
Type (e.g.,  a "Eurodollar  Loan" or "Base Rate Loan").  Borrowings  also may be
classified and referred to by Type (e.g.,  "Eurodollar  Borrowing" or "Base Rate
Borrowing").

Section 1.3. Accounting Terms and Determination.

     Unless  otherwise  defined or specified  herein,  all accounting terms used
herein shall be interpreted,  all accounting  determinations  hereunder shall be
made, and all financial  statements  required to be delivered hereunder shall be
prepared,  in accordance with GAAP as in effect from time to time,  applied on a
basis consistent  (except for such changes approved by KPP's independent  public
accountants) with the most recent audited  consolidated  financial  statement of
KPP delivered  pursuant to Section  5.1(a);  provided,  that if KPP notifies the
Administrative  Agent  that KPP  wishes to amend any  covenant  in Article VI to
eliminate the effect of any change in GAAP on the operation of such covenant (or
if the Administrative Agent notifies KPP that the Required Lenders wish to amend
Article VI for such purpose),  then KPP's compliance with such covenant shall be
determined on the basis of GAAP in effect immediately before the relevant change
in GAAP became effective, until either such notice is withdrawn or such covenant
is amended in a manner satisfactory to KPP and the Required Lenders.

Section 1.4. Terms Generally.

     The  definitions  of terms herein  shall apply  equally to the singular and
plural forms of the terms defined. Whenever the context may require, any pronoun
shall include the corresponding masculine,  feminine and neuter forms. The words
"include",  "includes"  and  "including"  shall be deemed to be  followed by the
phrase "without limitation". The word "will" shall be construed to have the same
meaning and effect as the word "shall".  In the  computation  of periods of time
from a specified date to a later specified date, the word "from" means "from and
including"  and the word  "to"  means "to but  excluding".  Unless  the  context
requires  otherwise  (i)  any  definition  of or  reference  to  any  agreement,
instrument  or other  document  herein  shall be  construed as referring to such
agreement,  instrument or other document as it was originally  executed or as it
may from time to time be amended,  restated,  supplemented or otherwise modified
(subject to any  restrictions on such  amendments,  supplements or modifications
set forth herein), (ii) any reference herein to any Person shall be construed to
include  such  Person's  successors  and  permitted  assigns,  (iii)  the  words
"hereof",  "herein"  and  "hereunder"  and  words  of  similar  import  shall be
construed  to  refer  to this  Agreement  as a whole  and not to any  particular
provision  hereof,  (iv) all  references  to  Articles,  Sections,  Exhibits and
Schedules  shall be  construed  to refer to  Articles,  Sections,  Exhibits  and
Schedules to this  Agreement and (v) all  references to a specific time shall be
construed  to refer to the  time in the  city  and  state of the  Administrative
Agent's principal office, unless otherwise indicated.

                 Article II AMOUNT AND TERMS OF THE COMMITMENTS

Section 2.1. The Revolving Credit Facility.

     Subject to and upon the terms and  conditions  herein  set  forth,  (i) the
Lenders hereby  establish in favor of the Borrower a revolving  credit  facility
pursuant to which each Lender  severally  agrees (to the extent of such Lender's
Commitment)  to make Loans to the Borrower in accordance  with Section 2.2, (ii)
the Issuing Bank agrees to issue  Letters of Credit in  accordance  with Section
2.19, and (iii) each Lender agrees to purchase a  participation  interest in the
Letters of Credit pursuant to the terms and conditions hereof; provided, that in
no event shall the aggregate principal amount of all outstanding Credit Exposure
exceed at any time the Aggregate Commitments from time to time in effect.

Section 2.2. The Loans.

     Subject to the terms and conditions set forth herein, each Lender severally
agrees to make  Loans,  ratably  in  proportion  to its Pro Rata  Share,  to the
Borrower,  from time to time from the date hereof until the Termination Date, in
an aggregate  principal  amount  outstanding at any time that will not result in
(i) such Lender's Credit Exposure exceeding such Lender's Commitment or (ii) the
sum of the  aggregate  Credit  Exposures of all Lenders  exceeding the Aggregate
Commitments.  Until the  Termination  Date,  the  Borrower  shall be entitled to
borrow, prepay and reborrow Loans in accordance with the terms and conditions of
this Agreement.

Section 2.3. Procedure for Borrowings.

     The  Borrower  shall  give the  Administrative  Agent  written  notice  (or
telephonic notice promptly confirmed in writing) of each Borrowing substantially
in the form of Exhibit D (a "Notice of Borrowing")  (x) prior to 11:00 a.m. (New
York  time)  one  Business  Day  prior to the  requested  date of each Base Rate
Borrowing and (y) prior to 11:00 a.m. (New York time) three  Business Days prior
to the requested  date of each  Eurodollar  Borrowing.  Each Notice of Borrowing
shall be irrevocable and shall specify:  (i) the aggregate  principal  amount of
such Borrowing, (ii) the date of such Borrowing (which shall be a Business Day),
(iii) the Type of such Loan  comprising such Borrowing and (iv) in the case of a
Eurodollar  Borrowing,  the duration of the initial  Interest Period  applicable
thereto (subject to the provisions of the definition of Interest  Period).  Each
Borrowing shall consist entirely of Base Rate Loans or Eurodollar  Loans, as the
Borrower  may  request.  The  aggregate  principal  amount  of  each  Eurodollar
Borrowing  shall be not less than $5,000,000 or a larger multiple of $1,000,000,
and the aggregate principal amount of each Base Rate Borrowing shall not be less
than $1,000,000 or a larger multiple of $100,000; provided, that Base Rate Loans
made  pursuant  to Section  2.19(d)  may be made in lesser  amounts as  provided
therein. At no time shall the total number of Eurodollar Borrowings  outstanding
at any time exceed five. Promptly following the receipt of a Notice of Borrowing
in accordance herewith, the Administrative Agent shall advise each Lender of the
details  thereof and the amount of such  Lender's Loan to be made as part of the
requested Borrowing.

Section 2.4. Funding of Borrowings.

          (a)  Each  Lender  will  make  available  each  Loan  to be made by it
     hereunder on the  proposed  date  thereof by wire  transfer in  immediately
     available funds by 11:00 a.m. (New York time) to the  Administrative  Agent
     at the  Payment  Office.  The  Administrative  Agent  will make such  Loans
     available  to the  Borrower  by  promptly  crediting  the  amounts  that it
     receives,  in like funds by the close of business on such proposed date, to
     an account maintained by the Borrower with the  Administrative  Agent or at
     the Borrower's  option,  by effecting a wire transfer of such amounts to an
     account designated by the Borrower to the Administrative Agent.

          (b) Unless the  Administrative  Agent shall have been  notified by any
     Lender  prior to 5 p.m.  (New York time) one Business Day prior to the date
     of a Borrowing in which such Lender is participating  that such Lender will
     not make available to the Administrative  Agent such Lender's share of such
     Borrowing,  the  Administrative  Agent may assume that such Lender has made
     such amount  available to the  Administrative  Agent on such date,  and the
     Administrative Agent, in reliance on such assumption, may make available to
     the Borrower on such date a  corresponding  amount.  If such  corresponding
     amount is not in fact made  available to the  Administrative  Agent by such
     Lender on the date of such  Borrowing,  the  Administrative  Agent shall be
     entitled to recover  such  corresponding  amount on demand from such Lender
     together  with  interest at the  Federal  Funds Rate for up to two days and
     thereafter at the rate  specified for such  Borrowing.  If such Lender does
     not pay such corresponding amount forthwith upon the Administrative Agent's
     demand  therefor,  the  Administrative  Agent  shall  promptly  notify  the
     Borrower,  and the Borrower shall immediately pay such corresponding amount
     to the  Administrative  Agent  together with interest at the rate specified
     for such Borrowing.  Nothing in this subsection  shall be deemed to relieve
     any Lender from its  obligation to fund its Pro Rata Share of any Borrowing
     hereunder  or to  prejudice  any rights which the Borrower may have against
     any Lender as a result of any default by such Lender hereunder.

          (c) All Borrowings  shall be made by the Lenders on the basis of their
     respective Pro Rata Shares.  No Lender shall be responsible for any default
     by any other Lender in its obligations hereunder,  and each Lender shall be
     obligated to make its Loans provided to be made by it hereunder, regardless
     of the failure of any other Lender to make its Loans hereunder.

Section 2.5. Interest Elections.

          (a) Each  Borrowing  initially  shall be of the Type  specified in the
     applicable Notice of Borrowing,  and in the case of a Eurodollar Borrowing,
     shall  have an  initial  Interest  Period as  specified  in such  Notice of
     Borrowing.  Thereafter,  the Borrower  may elect to convert such  Borrowing
     into a different Type or to continue such  Borrowing,  and in the case of a
     Eurodollar Borrowing,  may elect Interest Periods therefor, all as provided
     in this Section.  The Borrower may elect different  options with respect to
     different  portions  of the  affected  Borrowing,  in which  case each such
     portion  shall  be  allocated  ratably  among  the  Lenders  holding  Loans
     comprising such Borrowing, and the Loans comprising each such portion shall
     be  considered a separate  Borrowing.

          (b) To make an election  pursuant to this Section,  the Borrower shall
     give the  Administrative  Agent prior written notice (or telephonic  notice
     promptly confirmed in writing) of each Borrowing  substantially in the form
     of Exhibit E attached hereto (a "Notice of  Conversion/Continuation")  that
     is to be  converted  or  continued,  as the case may be, (x) prior to 10:00
     a.m.  (New York time) one  Business  Day prior to the  requested  date of a
     conversion into a Base Rate Borrowing and (y) prior to 11:00 a.m. (New York
     time) three Business Days prior to a continuation  of or conversion  into a
     Eurodollar Borrowing. Each such Notice of Conversion/Continuation  shall be
     irrevocable  and shall  specify (i) the  Borrowing  to which such Notice of
     Continuation/Conversion applies and, if different options are being elected
     with respect to different  portions thereof,  the portions thereof that are
     to be allocated to each resulting  Borrowing (in which case the information
     to be specified  pursuant to clauses  (iii) and (iv) shall be specified for
     each  resulting  Borrowing);  (ii) the effective  date of the election made
     pursuant  to such  Notice  of  Continuation/Conversion,  which  shall  be a
     Business Day,  (iii)  whether the resulting  Borrowing is to be a Base Rate
     Borrowing or a Eurodollar Borrowing; and (iv) if the resulting Borrowing is
     to be a Eurodollar Borrowing,  the Interest Period applicable thereto after
     giving effect to such election, which shall be a period contemplated by the
     definition    of    "Interest    Period".    If   any   such    Notice   of
     Continuation/Conversion  requests  a  Eurodollar  Borrowing  but  does  not
     specify an Interest  Period,  the Borrower shall be deemed to have selected
     an Interest  Period of one month.  The  principal  amount of any  resulting
     Borrowing  shall  satisfy  the  minimum  borrowing  amount  for  Eurodollar
     Borrowings and Base Rate Borrowings set forth in Section 2.3.

          (c) If, on the  expiration  of any  Interest  Period in respect of any
     Eurodollar Borrowing, the Borrower shall have failed to deliver a Notice of
     Conversion/ Continuation, then, unless such Borrowing is repaid as provided
     herein,  the  Borrower  shall be deemed to have  elected  to  convert  such
     Borrowing to a Base Rate Borrowing.  No Borrowing may be converted into, or
     continued  as, a  Eurodollar  Borrowing if a Default or an Event of Default
     has occurred and is continuing, unless the Administrative Agent and each of
     the Lenders shall have otherwise consented in writing. No conversion of any
     Eurodollar  Loans shall be permitted except on the last day of the Interest
     Period in respect thereof.

          (d)  Upon  receipt  of  any  Notice  of  Conversion/Continuation,  the
     Administrative  Agent  shall  promptly  notify  each  Lender of the details
     thereof and of such Lender's portion of each resulting Borrowing.

Section 2.6. Reduction and Termination of Commitments.

          (a)  Unless  previously  terminated,  all  Commitments  (including  LC
     Commitments) shall terminate on the Termination Date.

          (b) Upon at least  three  Business  Days'  prior  written  notice  (or
     telephonic  notice  promptly  confirmed  in writing) to the  Administrative
     Agent  (which  notice  shall be  irrevocable),  the Borrower may reduce the
     Aggregate  Commitments  in part or terminate the Aggregate  Commitments  in
     whole;  provided,  that (i) any  partial  reduction  shall  apply to reduce
     proportionately  and  permanently  the Commitment of each Lender,  (ii) any
     partial reduction  pursuant to this Section 2.6 shall be in an amount of at
     least  $5,000,000 and any larger multiple of $1,000,000,  and (iii) no such
     reduction shall be permitted that would reduce the Aggregate Commitments to
     an amount less than the outstanding  Credit  Exposures of all Lenders.  Any
     such reduction in the Aggregate  Commitments below the aggregate  principal
     amount of the LC  Commitment  shall result in an equal  reduction to the LC
     Commitment.

Section 2.7. Repayment of Loans.

     The  outstanding  principal  amount of all Loans  shall be due and  payable
(together with accrued and unpaid interest thereon) on the Termination Date.

Section 2.8. Evidence of Indebtedness.

          (a) Each Lender shall  maintain in accordance  with its usual practice
     appropriate  records  evidencing the  indebtedness  of the Borrower to such
     Lender  resulting  from each Loan  made by such  Lender  from time to time,
     including the amounts of principal and interest payable thereon and paid to
     such  Lender  from time to time under this  Agreement.  The  Administrative
     Agent shall maintain appropriate records in which shall be recorded (i) the
     Commitment of each Lender,  (ii) the amount of each Loan made  hereunder by
     each Lender,  the Type thereof and the Interest Period applicable  thereto,
     (iii) the date of each  continuation  thereof pursuant to Section 2.5, (iv)
     the date of each  conversion  of all or a portion  thereof to another  Type
     pursuant  to  Section  2.5,  (v) the date and  amount of any  principal  or
     interest  due and payable or to become due and payable from the Borrower to
     each Lender  hereunder  in respect of such Loans and (vi) both the date and
     amount of any sum received by the  Administrative  Agent hereunder from the
     Borrower in respect of the Loans and each Lender's Pro Rata Share  thereof.
     The  entries  made in such  records  shall be prima  facie  evidence of the
     existence and amounts of the obligations of the Borrower therein  recorded;
     provided,  that the  failure or delay of any  Lender or the  Administrative
     Agent in  maintaining  or making  entries into any such record or any error
     therein  shall not in any manner  affect the  obligation of the Borrower to
     repay the Loans (both principal and unpaid accrued interest) of such Lender
     in accordance with the terms of this Agreement.

          (b) At the request of any Lender at any time, the Borrower agrees that
     it will execute and deliver to such Lender a Note,  payable to the order of
     such Lender.

Section 2.9. Prepayments.

     The  Borrower  shall  have the  right at any time and from  time to time to
prepay any Borrowing, in whole or in part, without premium or penalty, by giving
irrevocable  written notice (or telephonic notice promptly confirmed in writing)
to the  Administrative  Agent no later than (i) in the case of prepayment of any
Eurodollar  Borrowing,  11:00 a.m. (New York time) not less than three  Business
Days prior to any such prepayment, and (ii) in the case of any prepayment of any
Base Rate  Borrowing,  not less than one  Business Day prior to the date of such
prepayment. Each such notice shall be irrevocable and shall specify the proposed
date of such  prepayment  and the principal  amount of each Borrowing or portion
thereof to be prepaid. Upon receipt of any such notice, the Administrative Agent
shall promptly notify each affected  Lender of the contents  thereof and of such
Lender's  Pro Rata Share of any such  prepayment.  If such notice is given,  the
aggregate  amount  specified in such notice shall be due and payable on the date
designated in such notice,  together  with accrued  interest to such date on the
amount so  prepaid in  accordance  with  Section  2.10(c);  provided,  that if a
Eurodollar Borrowing is prepaid on a date other than the last day of an Interest
Period  applicable  thereto,  the Borrower  shall also pay all amounts  required
pursuant to Section  2.16.  Each partial  prepayment  of any Loan shall be in an
amount that would be  permitted  in the case of an advance of a Borrowing of the
same Type  pursuant to Section  2.2.  Each  prepayment  of a Borrowing  shall be
applied ratably to the Loans comprising such Borrowing.

Section 2.10. Interest on Loans.

          (a) The Borrower shall pay interest on each Base Rate Loan at the Base
     Rate  in  effect  from  time to time  and on  each  Eurodollar  Loan at the
     Adjusted LIBO Rate for the  applicable  Interest  Period in effect for such
     Loan,  plus,  in each case,  the  Applicable  Margin in effect from time to
     time.

          (b) If an Event of Default  has  occurred  and is  continuing,  at the
     option of the Required Lenders,  the Borrower shall pay interest  ("Default
     Interest")  with  respect  to all  Eurodollar  Loans at the rate  otherwise
     applicable for the  then-current  Interest Period plus an additional 2% per
     annum until the last day of such Interest Period, and thereafter,  and with
     respect to all Base Rate Loans and all other  Obligations  hereunder (other
     than  Loans),  at an all-in  rate in effect  for Base Rate  Loans,  plus an
     additional 2% per annum.

          (c)  Interest on the  principal  amount of all Loans shall accrue from
     and including the date such Loans are made to but excluding the date of any
     repayment  thereof.  Interest on all  outstanding  Base Rate Loans shall be
     payable quarterly in arrears on the last day of each March, June, September
     and  December  and on the  Termination  Date.  Interest on all  outstanding
     Eurodollar  Loans shall be payable on the last day of each Interest  Period
     applicable  thereto,  and, in the case of any  Eurodollar  Loans  having an
     Interest  Period in excess of three  months,  on each day that occurs every
     three months,  after the initial date of such Interest  Period,  and on the
     Termination  Date.  Interest on any Loan that is  converted  into a Loan of
     another  Type or that is repaid or prepaid  shall be payable on the date of
     such  conversion or on the date of any such repayment or prepayment (on the
     amount repaid or prepaid) thereof. All Default Interest shall be payable on
     demand.

          (d) The  Administrative  Agent  shall  determine  each  interest  rate
     applicable to the Loans  hereunder and shall  promptly  notify the Borrower
     and  the  Lenders  of such  rate  in  writing  (or by  telephone,  promptly
     confirmed in  writing).  Any such  determination  shall be  conclusive  and
     binding for all purposes, absent manifest error.

Section 2.11. Fees.

          (a) Agency Fees.  The Borrower shall pay to the  Administrative  Agent
     for its own account fees in the amounts and at the times agreed upon by the
     Borrower in the Fee Letter  described  in clause (i) of the  definition  of
     "Fee Letters".

          (b) Commitment Fee. The Borrower  agrees to pay to the  Administrative
     Agent for the account of each Lender a commitment fee which shall accrue at
     the Applicable  Commitment Fee Percentage  (determined  daily in accordance
     with  Schedule  I) on the daily  amount of the  unused  Commitment  of such
     Lender from the date hereof until the Termination Date.  Accrued commitment
     fees  shall be payable  in  arrears  on the last day of each  March,  June,
     September  and  December,  commencing on the first such date to occur after
     the date hereof, and on the Termination Date.

          (c)  Letter  of  Credit  Fee.  The  Borrower  agrees to pay (i) to the
     Administrative  Agent,  for the account of each Lender,  a letter of credit
     fee with respect to its participation in each Letter of Credit, which shall
     accrue at a rate per annum equal to the  Applicable  Margin for  Eurodollar
     Loans  then in effect on the  average  daily  amount  of such  Lender's  LC
     Exposure  attributable  to such Letter of Credit during the period from and
     including  the date of issuance  of each Letter of Credit to but  excluding
     the  date on  which  such  Letter  of  Credit  expires  or is drawn in full
     (including  without  limitation  any LC Exposure  that remains  outstanding
     after  the  Termination  Date)  and  (ii) to the  Issuing  Bank for its own
     account a fronting fee,  which shall accrue at the rate of 0.125% per annum
     on the  average  daily  amount of the LC  Exposure  from the  Closing  Date
     through the Termination  Date (or until the date that such Letter of Credit
     is  irrevocably  cancelled,  whichever  is later),  as well as the  Issuing
     Bank's  standard  fees with  respect  to  issuance,  amendment,  renewal or
     extension  of any Letter of Credit or  processing  of drawings  thereunder.
     Notwithstanding  the foregoing,  if the Required  Lenders elect to increase
     interest on the Loans to the Default Interest  pursuant to Section 2.10(b),
     the  letter of credit  fees  payable  pursuant  to clause  (i) above  shall
     automatically be increased by an additional 2% per annum.

          (d) Upfront Fees. The Borrower shall pay to the Administrative  Agent,
     for the benefit of the Lenders,  the upfront fee previously  agreed upon by
     the Borrower and the  Administrative  Agent, which shall be due and payable
     on the Closing Date.

          (e) Accrued fees shall be payable quarterly in arrears on the last day
     of each March,  June,  September and December,  commencing on June 30, 2003
     and on the  Termination  Date  (and if  later,  the date the  Loans  and LC
     Exposure shall be repaid in their entirety; provided further, that any such
     fees accruing after the Termination Date shall be payable on demand.


Section 2.12. Computation of Interest and Fees.

     Interest based on the Administrative  Agent's prime rate pursuant to clause
(i) of the definition of "Base Rate" shall be computed on the basis of a year of
365 days (or 366 days in a leap  year)  and paid for the  actual  number of days
elapsed (including the first day but excluding the last day). All other interest
and all fees shall be  computed  on the basis of a year of 360 days and paid for
the actual  number of days elapsed  (including  the first day but  excluding the
last day). Each determination by the Administrative Agent of an interest rate or
fee hereunder shall be made in good faith and, except for manifest error,  shall
be final, conclusive and binding for all purposes.

Section 2.13. Inability to Determine Interest Rates.

     If prior to the  commencement  of any  Interest  Period for any  Eurodollar
Borrowing,   (i)  the   Administrative   Agent  shall  have  determined   (which
determination shall be conclusive and binding upon the Borrower) that, by reason
of circumstances  affecting the relevant interbank market, adequate means do not
exist  for   ascertaining   LIBOR  for  such  Interest   Period,   or  (ii)  the
Administrative  Agent shall have received notice from the Required  Lenders that
the Adjusted LIBO Rate does not  adequately  and fairly reflect the cost to such
Lenders (or Lender, as the case may be) of making,  funding or maintaining their
Eurodollar Loans for such Interest Period, the  Administrative  Agent shall give
written  notice (or  telephonic  notice,  promptly  confirmed in writing) to the
Borrower  and to the  Lenders  as  soon as  practicable  thereafter.  Until  the
Administrative  Agent  shall  notify  the  Borrower  and the  Lenders  that  the
circumstances giving rise to such notice no longer exist, (i) the obligations of
the Lenders to make Eurodollar Loans or to continue or convert outstanding Loans
as or into Eurodollar  Loans shall be suspended and (ii) all such affected Loans
shall be  converted  into  Base Rate  Loans on the last day of the then  current
Interest  Period  applicable  thereto unless the Borrower  prepays such Loans in
accordance with this Agreement.

Section 2.14. Illegality.

     If any Change in Law shall make it unlawful or impossible for any Lender to
make,  maintain or fund any Eurodollar  Loan and such Lender shall so notify the
Administrative  Agent,  the  Administrative  Agent  shall  promptly  give notice
thereof to the  Borrower  and the other  Lenders,  whereupon  until such  Lender
notifies the Administrative Agent and the Borrower that the circumstances giving
rise to such  suspension no longer exist,  the obligation of such Lender to make
Eurodollar  Loans,  or to  continue  or  convert  outstanding  Loans  as or into
Eurodollar Loans, shall be suspended.  In the case of the making of a Eurodollar
Borrowing,  such  Lender's Loan shall be made as a Base Rate Loan as part of the
same  Borrowing for the same Interest  Period,  and, if the affected  Eurodollar
Loan is then  outstanding,  such  Loan  shall be  converted  to a Base Rate Loan
either (i) on the last day of the then current  Interest  Period  applicable  to
such Eurodollar Loan if such Lender may lawfully  continue to maintain such Loan
to such date or (ii)  immediately if such Lender shall determine that it may not
lawfully continue to maintain such Eurodollar Loan to such date. Notwithstanding
the  foregoing,  the affected  Lender shall,  prior to giving such notice to the
Administrative  Agent,  designate a different  Applicable Lending Office if such
designation  would avoid the need for giving such notice and if such designation
would not otherwise be disadvantageous to such Lender in the good faith exercise
of its discretion.

Section 2.15. Increased Costs.

     (a) If any Change in Law shall:

               (i)  impose,  modify  or deem  applicable  any  reserve,  special
          deposit or similar  requirement that is not otherwise  included in the
          determination  of the Adjusted LIBO Rate hereunder  against assets of,
          deposits with or for the account of, or credit extended by, any Lender
          (except any such reserve  requirement  reflected in the Adjusted  LIBO
          Rate) or the Issuing Bank; or

               (ii)  impose  on  any  Lender  or on  the  Issuing  Bank  or  the
          eurodollar   interbank  market  any  other  condition  affecting  this
          Agreement or any Eurodollar Loans made by such Lender or any Letter of
          Credit or any participation  therein;  and the result of either of the
          foregoing is to increase the cost to such Lender of making, converting
          into,  continuing or maintaining a Eurodollar  Loan or to increase the
          cost to such Lender or the Issuing Bank of participating in or issuing
          any Letter of Credit or to reduce the amount received or receivable by
          such  Lender or the Issuing  Bank  hereunder  (whether  of  principal,
          interest or any other  amount),  then the Borrower shall promptly pay,
          upon  written  notice from and demand by such  Lender on the  Borrower
          (with a copy of such notice and demand to the  Administrative  Agent),
          to the  Administrative  Agent for the account of such  Lender,  within
          five  Business  Days  after  the  date  of  such  notice  and  demand,
          additional  amount or amounts  sufficient to compensate such Lender or
          the  Issuing  Bank,  as the case may be,  for  such  additional  costs
          incurred or reduction suffered.

          (b) If any Lender or the Issuing Bank shall have determined that on or
     after  the date of this  Agreement  any  Change  in Law  regarding  capital
     requirements has or would have the effect of reducing the rate of return on
     such  Lender's  or the  Issuing  Bank's  capital (or on the capital of such
     Lender's or the Issuing Bank's parent  corporation) as a consequence of its
     obligations  hereunder  or under or in respect of any Letter of Credit to a
     level below that which such Lender or the Issuing Bank or such  Lender's or
     the Issuing  Bank's  parent  corporation  could have  achieved but for such
     Change in Law  (taking  into  consideration  such  Lender's  or the Issuing
     Bank's  policies  or the  policies of such  Lender's or the Issuing  Bank's
     parent  corporation  with respect to capital  adequacy)  then, from time to
     time,  within  five (5)  Business  Days after  receipt by the  Borrower  of
     written  demand by such Lender (with a copy  thereof to the  Administrative
     Agent),  the Borrower shall pay to such Lender such  additional  amounts as
     will  compensate  such Lender or the Issuing  Bank or such  Lender's or the
     Issuing Bank's parent corporation for any such reduction suffered.

          (c) A  certificate  of a Lender or the Issuing Bank setting  forth the
     amount or amounts  necessary to compensate  such Lender or the Issuing Bank
     or such Lender's or the Issuing Bank's parent corporation,  as the case may
     be,  specified in subsection  (a) or (b) of this Section shall be delivered
     to the  Borrower  (with a copy to the  Administrative  Agent)  and shall be
     conclusive,  absent manifest error.  The Borrower shall pay any such Lender
     or the Issuing Bank,  as the case may be, such amount or amounts  within 10
     days after receipt thereof.

          (d) Failure or delay on the part of any Lender or the Issuing  Bank to
     demand compensation  pursuant to this Section shall not constitute a waiver
     of such Lender's or the Issuing Bank's right to demand such compensation

Section 2.16. Funding Indemnity.

     In the event of (i) the payment of any principal of a Eurodollar Loan other
than on the last day of the Interest Period applicable  thereto  (including as a
result  of an Event  of  Default),  (ii) the  conversion  or  continuation  of a
Eurodollar  Loan other than on the last day of the  Interest  Period  applicable
thereto,  or (iii) the  failure by the  Borrower to borrow,  prepay,  convert or
continue any  Eurodollar  Loan on the date  specified in any  applicable  notice
(regardless  of whether such notice is withdrawn or revoked),  then, in any such
event,  the Borrower  shall  compensate  each Lender,  within five Business Days
after  written  demand  from  such  Lender,   for  any  loss,  cost  or  expense
attributable to such event. In the case of a Eurodollar Loan, such loss, cost or
expense shall be deemed to include an amount determined by such Lender to be the
excess,  if any,  of (A) the amount of interest  that would have  accrued on the
principal  amount of such  Eurodollar Loan if such event had not occurred at the
Adjusted LIBO Rate  applicable to such  Eurodollar  Loan for the period from the
date of such event to the last day of the then current  Interest Period therefor
(or in the case of a failure to borrow, convert or continue, for the period that
would  have been the  Interest  Period  for such  Eurodollar  Loan) over (B) the
amount of interest that would accrue on the principal  amount of such Eurodollar
Loan for the same  period  if the  Adjusted  LIBO Rate were set on the date such
Eurodollar  Loan were  prepaid or  converted  or the date on which the  Borrower
failed to borrow,  convert or continue such Eurodollar Loan. A certificate as to
any additional  amount payable under this Section 2.16 submitted to the Borrower
by any Lender (with a copy to the  Administrative  Agent)  shall be  conclusive,
absent manifest error.

Section 2.17. Taxes.

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

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

          (c) The Borrower shall indemnify the Administrative Agent, each Lender
     and the Issuing Bank,  within five (5) Business  Days after written  demand
     therefor,  for the full amount of any Indemnified Taxes or Other Taxes paid
     by the  Administrative  Agent, such Lender or the Issuing Bank, as the case
     may  be,  on or  with  respect  to  any  payment  by or on  account  of any
     obligation of the Borrower hereunder (including  Indemnified Taxes or Other
     Taxes imposed or asserted on or  attributable to amounts payable under this
     Section)  and any  penalties,  interest  and  reasonable  expenses  arising
     therefrom or with respect thereto, whether or not such Indemnified Taxes or
     Other Taxes were  correctly or legally  imposed or asserted by the relevant
     Governmental  Authority.  A certificate as to the amount of such payment or
     liability  delivered to the Borrower by a Lender or the Issuing Bank, or by
     the Administrative  Agent on its own behalf or on behalf of a Lender or the
     Issuing Bank, shall be conclusive absent manifest error.

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

          (e) Each Foreign Lender represents and warrants to the  Administrative
     Agent and the Borrower  that, as of the date such Lender becomes a party to
     this  Agreement,  such Lender is entitled to an exemption from  withholding
     tax under the Code or any treaty to which the United States is a party with
     respect to payments  under this  Agreement,  and each Foreign  Lender shall
     deliver to the Borrower (with a copy to the  Administrative  Agent), at the
     time or times  prescribed  by applicable  law, such properly  completed and
     executed documentation prescribed by applicable law or reasonably requested
     by the Borrower as will permit such payments to be made without withholding
     or at a reduced rate.  Without  limiting the  generality of the  foregoing,
     each Foreign Lender agrees that it will deliver to the Administrative Agent
     and the Borrower (or in the case of a Participant, to the Lender from which
     the related participation shall have been purchased),  as appropriate,  two
     (2) duly completed  copies of (i) Internal Revenue Service Form W-8 ECI, or
     any successor form thereto,  certifying that the payments received from the
     Borrower  hereunder are  effectively  connected with such Foreign  Lender's
     conduct of a trade or  business  in the  United  States;  or (ii)  Internal
     Revenue  Service Form W-8 BEN, or any successor  form  thereto,  certifying
     that such Foreign Lender is entitled to benefits under an income tax treaty
     to which the United States is a party which reduces the rate of withholding
     tax on payments of interest;  or (iii)  Internal  Revenue  Service Form W-8
     BEN, or any  successor  form  prescribed by the Internal  Revenue  Service,
     together  with a  certificate  (A)  establishing  that the  payment  to the
     Foreign  Lender   qualifies  as  "portfolio   interest"  exempt  from  U.S.
     withholding  tax under Code section 871(h) or 881(c),  and (B) stating that
     (1)  the  Foreign  Lender  is not a  bank  for  purposes  of  Code  section
     881(c)(3)(A),  or the  obligation  of the Borrower  hereunder is not,  with
     respect  to such  Foreign  Lender,  a loan  agreement  entered  into in the
     ordinary  course of its  trade or  business,  within  the  meaning  of that
     section;  (2) the Foreign  Lender is not a 10%  shareholder of the Borrower
     within the meaning of Code section  871(h)(3) or 881(c)(3)(B);  and (3) the
     Foreign Lender is not a controlled  foreign  corporation that is related to
     the Borrower within the meaning of Code section 881(c)(3)(C);  or (iv) such
     other  Internal  Revenue  Service forms as may be applicable to the Foreign
     Lender,  including Forms W-8 IMY or W-8 EXP. Each such Foreign Lender shall
     deliver  to the  Borrower  and the  Administrative  Agent  such forms on or
     before the date that it becomes a party to this  Agreement  (or in the case
     of a  Participant,  on or before the date such  Participant  purchases  the
     related participation). In addition, each such Foreign Lender shall deliver
     such  forms  promptly  upon  the  obsolescence  or  invalidity  of any form
     previously delivered by such Foreign Lender. Each such Foreign Lender shall
     promptly notify the Borrower and the Administrative  Agent at any time that
     it determines  that it is no longer in a position to provide any previously
     delivered  certificate to the Borrower (or any other form of  certification
     adopted by the Internal Revenue Service for such purpose).

Section 2.18. Payments Generally; Pro Rata Treatment; Sharing of Set-offs.

          (a) The  Borrower  shall make each  payment  required to be made by it
     hereunder  (whether of principal,  interest,  fees or  reimbursement  of LC
     Disbursements,  or of amounts  payable under Section 2.15, 2.16 or 2.17, or
     otherwise)  prior  to  12:00  noon  on the  date  when  due in  immediately
     available  funds,  free  and  clear of any  defenses,  rights  or  set-off,
     counterclaim,  or withholding or deduction of taxes.  Any amounts  received
     after such time on any date may, in the  discretion  of the  Administrative
     Agent, be deemed to have been received on the next succeeding  Business Day
     for purposes of calculating  interest  thereon.  All such payments shall be
     made to the Administrative Agent at the Payment Office,  except payments to
     be made  directly  to the Issuing  Bank as  expressly  provided  herein and
     except that  payments  pursuant to  Sections  2.15,  2.16 and 2.17 and 11.3
     shall be made directly to the Persons entitled thereto.  The Administrative
     Agent shall distribute any such payments  received by it for the account of
     any other Person to the appropriate  recipient  promptly  following receipt
     thereof.  If any  payment  hereunder  shall  be due on a day  that is not a
     Business Day, the date for payment shall be extended to the next succeeding
     Business Day, and, in the case of any payment accruing  interest,  interest
     thereon  shall  be made  payable  for the  period  of such  extension.  All
     payments hereunder shall be made in Dollars.

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

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

          (d) Unless the  Administrative  Agent shall have received  notice from
     the  Borrower  prior  to  the  date  on  which  any  payment  is due to the
     Administrative  Agent for the account of the  Lenders or the  Issuing  Bank
     hereunder that the Borrower will not make such payment,  the Administrative
     Agent may assume that the  Borrower  has made such  payment on such date in
     accordance  herewith and may, in reliance upon such assumption,  distribute
     to the  Lenders  or the  Issuing  Bank,  as the case may be,  the amount or
     amounts  due.  In such  event,  if the  Borrower  has not in fact made such
     payment,  then each of the Lenders or the Issuing Bank, as the case may be,
     severally agrees to repay to the  Administrative  Agent forthwith on demand
     the amount so  distributed  to such  Lender or Issuing  Bank with  interest
     thereon,  for  each  day  from  and  including  the  date  such  amount  is
     distributed   to  it  to  but   excluding   the  date  of  payment  to  the
     Administrative  Agent,  at the greater of the Federal Funds Rate and a rate
     determined by the Administrative  Agent in accordance with banking industry
     rules on interbank compensation.

          (e) If any Lender  shall fail to make any payment  required to be made
     by it pursuant to Section 2.4(a) or 11.3(d),  then the Administrative Agent
     may, in its discretion  (notwithstanding  any contrary  provision  hereof),
     apply any amounts thereafter  received by the Administrative  Agent for the
     account of such  Lender to satisfy  such  Lender's  obligations  under such
     Sections until all such unsatisfied obligations are fully paid.

Section 2.19. Letters of Credit.

          (a) Prior to the Termination  Date, the Issuing Bank, in reliance upon
     the agreements of the other Lenders pursuant to Section 2.19(d),  agrees to
     issue, at the request of the Borrower, Letters of Credit for the account of
     the Borrower on the terms and conditions  hereinafter set forth;  provided,
     that (i) each Letter of Credit  shall expire on the earlier of (A) the date
     one year  after the date of  issuance  of such  Letter of Credit (or in the
     case of any renewal or  extension  thereof,  one year after such renewal or
     extension)  and (B) the date that is five (5)  Business  Days  prior to the
     Termination Date; (ii) each Letter of Credit shall be in a stated amount of
     at least  $100,000;  and (iii) the  Borrower  may not request any Letter of
     Credit,  if, after  giving  effect to such  issuance  (A) the  aggregate LC
     Exposure  would exceed the LC  Commitment or (B) the aggregate LC Exposure,
     plus the  aggregate  outstanding  Loans of all  Lenders  would  exceed  the
     Aggregate  Commitments.  Upon the  issuance  of each  Letter of Credit each
     Lender  shall be deemed  to,  and hereby  irrevocably  and  unconditionally
     agrees to, purchase from the Issuing Bank without  recourse a participation
     in such  Letter  of Credit  equal to such  Lender's  Pro Rata  Share of the
     aggregate  amount  available to be drawn under such Letter of Credit.  Each
     issuance of a Letter of Credit shall be deemed to utilize the Commitment of
     each Lender by an amount equal to the amount of such participation.

          (b) To request the  issuance of a Letter of Credit (or any  amendment,
     renewal or  extension  of an  outstanding  Letter of Credit),  the Borrower
     shall  give the  Issuing  Bank  and the  Administrative  Agent  irrevocable
     written notice at least three (3) Business Days prior to the requested date
     of such issuance  specifying  the date (which shall be a Business Day) such
     Letter of Credit is to be issued (or amended,  extended or renewed,  as the
     case may be), the expiration  date of such Letter of Credit,  the amount of
     such Letter of Credit , the name and address of the beneficiary thereof and
     such other  information as shall be necessary to prepare,  amend,  renew or
     extend  such  Letter of Credit.  In  addition  to the  satisfaction  of the
     conditions  in Article  III,  the issuance of such Letter of Credit (or any
     amendment  which  increases  the amount of such  Letter of Credit)  will be
     subject to the further  conditions  that such Letter of Credit  shall be in
     such form and contain such terms as the Issuing Bank shall approve and that
     the Borrower shall have executed and delivered any additional applications,
     agreements and instruments relating to such Letter of Credit as the Issuing
     Bank shall reasonably require;  provided, that in the event of any conflict
     between such  applications,  agreements or instruments  and this Agreement,
     the terms of this Agreement shall control.

          (c) At least two Business  Days prior to the issuance of any Letter of
     Credit,  the Issuing Bank will confirm  with the  Administrative  Agent (by
     telephone or in writing)  that the  Administrative  Agent has received such
     notice and if not, the Issuing Bank will provide the  Administrative  Agent
     with a copy thereof.  Unless the Issuing Bank has received  notice from the
     Administrative  Agent on or before the Business Day  immediately  preceding
     the date the Issuing  Bank is to issue the  requested  Letter of Credit (1)
     directing  the Issuing Bank not to issue the Letter of Credit  because such
     issuance is not then permitted  hereunder  because of the  limitations  set
     forth in  Section  2.19(a)  or that  one or more  conditions  specified  in
     Article  III are  not  then  satisfied,  then,  subject  to the  terms  and
     conditions  hereof,  the Issuing Bank shall, on the requested  date,  issue
     such  Letter of Credit in  accordance  with the  Issuing  Bank's  usual and
     customary business practices.

          (d) The  Issuing  Bank  shall  examine  all  documents  purporting  to
     represent a demand for payment under a Letter of Credit promptly  following
     its receipt  thereof.  The Issuing  Bank shall  notify the Borrower and the
     Administrative  Agent of such  demand for  payment  and whether the Issuing
     Bank has made or will make a LC Disbursement thereunder; provided, that any
     failure  to give or delay in  giving  such  notice  shall not  relieve  the
     Borrower of its  obligation  to reimburse  the Issuing Bank and the Lenders
     with respect to such LC Disbursement. The Borrower shall be irrevocably and
     unconditionally  obligated  to  reimburse  the  Issuing  Bank  for  any  LC
     Disbursements paid by the Issuing Bank in respect of such drawing,  without
     presentment,  demand or other  formalities of any kind. Unless the Borrower
     shall have notified the Issuing Bank and the Administrative  Agent prior to
     11:00 a.m.  (New York time) on the  Business Day  immediately  prior to the
     date on which  such  drawing  is  honored  that  the  Borrower  intends  to
     reimburse  the Issuing  Bank for the amount of such  drawing in funds other
     than from the  proceeds  of  Loans,  the  Borrower  shall be deemed to have
     timely given a Notice of Borrowing to the  Administrative  Agent requesting
     the Lenders to make a Base Rate Borrowing on the date on which such drawing
     is honored in an exact amount due to the Issuing Bank;  provided,  that for
     purposes solely of such Borrowing,  the conditions  precedents set forth in
     Section 3.2 hereof shall not be applicable.  The Administrative Agent shall
     notify the Lenders of such  Borrowing in  accordance  with Section 2.3, and
     each Lender shall make the proceeds of its Base Rate Loan  included in such
     Borrowing  available  to the  Administrative  Agent for the  account of the
     Issuing Bank in accordance with Section 2.4. The proceeds of such Borrowing
     shall be applied  directly by the  Administrative  Agent to  reimburse  the
     Issuing Bank for such LC Disbursement.

          (e) If for any reason a Base Rate  Borrowing may not be (as determined
     in the sole  discretion of the  Administrative  Agent),  or is not, made in
     accordance with the foregoing provisions,  then each Lender (other than the
     Issuing Bank) shall be obligated to fund the participation that such Lender
     purchased  pursuant to  subsection  (a) in an amount  equal to its Pro Rata
     Share of such LC  Disbursement  on and as of the date  which such Base Rate
     Borrowing  should  have  occurred.  Each  Lender's  obligation  to fund its
     participation shall be absolute and unconditional and shall not be affected
     by  any  circumstance,   including  without   limitation  (i)  any  setoff,
     counterclaim,  recoupment,  defense or other  right that such Lender or any
     other  Person may have against the Issuing Bank or any other Person for any
     reason  whatsoever,  (ii) the existence of a Default or an Event of Default
     or the termination of the Aggregate  Commitments,  (iii) any adverse change
     in the  condition  (financial  or  otherwise)  of KPP,  the Borrower or any
     Subsidiary,  (iv) any breach of this Agreement by the Borrower or any other
     Lender, (v) any amendment,  renewal or extension of any Letter of Credit or
     (vi) any other circumstance,  happening or event whatsoever, whether or not
     similar to any of the  foregoing.  On the date that such  participation  is
     required to be funded, each Lender shall promptly transfer,  in immediately
     available  funds,  the amount of its  participation  to the  Administrative
     Agent for the account of the Issuing Bank. Whenever,  at any time after the
     Issuing  Bank  has  received  from  any  such  Lender  the  funds  for  its
     participation in a LC Disbursement, the Issuing Bank (or the Administrative
     Agent  on  its  behalf)  receives  any  payment  on  account  thereof,  the
     Administrative  Agent  or the  Issuing  Bank,  as the  case  may  be,  will
     distribute  to such  Lender its Pro Rata Share of such  payment;  provided,
     that if such  payment  is  required  to be  returned  for any reason to the
     Borrower  or to a  trustee,  receiver,  liquidator,  custodian  or  similar
     official  in any  bankruptcy  proceeding,  such  Lender  will return to the
     Administrative  Agent or the Issuing  Bank any portion  thereof  previously
     distributed by the Administrative Agent or the Issuing Bank to it.

          (f) To the  extent  that  any  Lender  shall  fail to pay  any  amount
     required to be paid pursuant to subsection  (d) of this Section 2.19 on the
     due date  therefor,  such Lender  shall pay  interest  to the Issuing  Bank
     (through the Administrative Agent) on such amount from such due date to the
     date such  payment is made at a rate per annum equal to the  Federal  Funds
     Rate; provided,  that if such Lender shall fail to make such payment to the
     Issuing  Bank  within  three  (3)  Business  Days of such due  date,  then,
     retroactively  to the due  date,  such  Lender  shall be  obligated  to pay
     interest on such amount at the Default Rate.

          (g) If any Event of  Default  shall  occur and be  continuing,  on the
     Business  Day that the  Borrower  receives  notice from the  Administrative
     Agent or the  Required  Lenders  demanding  the deposit of cash  collateral
     pursuant to this subsection,  the Borrower shall deposit in an account with
     the Administrative  Agent, in the name of the Administrative  Agent and for
     the benefit of the Issuing Bank and the Lenders, an amount in cash equal to
     the LC Exposure  as of such date plus any accrued and unpaid fees  thereon;
     provided,  that the obligation to deposit such cash collateral shall become
     effective  immediately,  and such deposit shall become  immediately due and
     payable,  without demand or notice of any kind,  upon the occurrence of any
     Event of Default with  respect to the  Borrower  described in clause (g) or
     (h) of Section 9.1. Such deposit shall be held by the Administrative  Agent
     as collateral  for the payment and  performance  of the  obligations of the
     Borrower  under  this  Agreement.   The  Administrative  Agent  shall  have
     exclusive   dominion  and  control,   including  the  exclusive   right  of
     withdrawal,  over such  account.  Borrower  agrees to execute any documents
     and/or  certificates that may be necessary to effectuate the intent of this
     subsection.  Other  than any  interest  earned  on the  investment  of such
     deposits, which investments shall be made at the option and sole discretion
     of the  Administrative  Agent and at the Borrower's risk and expense,  such
     deposits  shall not bear  interest.  Interest and profits,  if any, on such
     investments shall accumulate in such account.  Moneys in such account shall
     be applied by the Administrative Agent to reimburse the Issuing Bank for LC
     Disbursements  for which it had not been  reimbursed  and to the  extent so
     applied,   shall  be  held  for  the  satisfaction  of  the   reimbursement
     obligations  of the  Borrower  for the LC  Exposure at such time or, if the
     maturity  of the  Loans  has  been  accelerated,  with the  consent  of the
     Required  Lenders,  be applied to satisfy other obligations of the Borrower
     under this  Agreement  and the other Loan  Documents.  If the  Borrower  is
     required to provide an amount of cash  collateral  hereunder as a result of
     the  occurrence  of an Event of Default,  such amount (to the extent not so
     applied as  aforesaid)  shall be  returned  to the  Borrower  within  three
     Business Days after all Events of Default have been cured or waived.

          (h) Promptly  following  the end of each Fiscal  Quarter,  the Issuing
     Bank shall deliver  (through the  Administrative  Agent) to each Lender and
     the  Borrower  a  report   describing  the  aggregate   Letters  of  Credit
     outstanding  at the end of such  Fiscal  Quarter.  Upon the  request of any
     Lender from time to time, the Issuing Bank shall deliver to such Lender any
     other information  reasonably requested by such Lender with respect to each
     Letter of Credit then outstanding.

          (i) The Borrower's obligation to reimburse LC Disbursements  hereunder
     shall be absolute,  unconditional  and  irrevocable  and shall be performed
     strictly  in  accordance  with  the  terms  of  this  Agreement  under  all
     circumstances   whatsoever  and   irrespective  of  any  of  the  following
     circumstances:

               (i) Any lack of  validity  or  enforceability  of any  Letter  of
          Credit or this Agreement;

               (ii) The existence of any claim, set-off,  defense or other right
          which the Borrower or any  Subsidiary or Affiliate of the Borrower may
          have at any time against a beneficiary or any transferee of any Letter
          of Credit (or any Persons or entities for whom any such beneficiary or
          transferee may be acting),  any Lender (including the Issuing Bank) or
          any other  Person,  whether in connection  with this  Agreement or the
          Letter of Credit or any  document  related  hereto or  thereto  or any
          unrelated transaction;

               (iii) Any  draft or other  document  presented  under a Letter of
          Credit  proving to be forged,  fraudulent or invalid in any respect or
          any statement therein being untrue or inaccurate in any respect;

               (iv) Payment by the Issuing Bank under a Letter of Credit against
          presentation  of a draft or other  document to the  Issuing  Bank that
          does not comply with the terms of such Letter of Credit;

               (v) Any other event or  circumstance  whatsoever,  whether or not
          similar to any of the foregoing, that might, but for the provisions of
          this Section, constitute a legal or equitable discharge of, or provide
          a right of setoff against, the Borrower's obligations hereunder; or

               (vi) The existence of a Default or an Event of Default.

     Neither the  Administrative  Agent,  the Issuing Bank,  the Lenders nor any
Related Party of any of the foregoing shall have any liability or responsibility
by reason of or in  connection  with the  issuance  or transfer of any Letter of
Credit or any payment or failure to make any payment thereunder (irrespective of
any  of  the  circumstances   referred  to  above),  or  any  error,   omission,
interruption,  loss or delay in transmission or delivery of any draft, notice or
other  communication  under or relating to any Letter of Credit  (including  any
document required to make a drawing thereunder),  any error in interpretation of
technical terms or any consequence arising from causes beyond the control of the
Issuing Bank; provided,  that the foregoing shall not be construed to excuse the
Issuing Bank from  liability to the Borrower to the extent of any actual  direct
damages (as opposed to special,  indirect  (including claims for lost profits or
other consequential  damages),  or punitive damages,  claims in respect of which
are hereby  waived by the Borrower to the extent  permitted by  applicable  law)
suffered  by the  Borrower  that are  caused by the  Issuing  Bank's  failure to
exercise due care when determining  whether drafts or other documents  presented
under a Letter of Credit  comply  with the terms  thereof.  The  parties  hereto
expressly agree,  that in the absence of gross negligence or willful  misconduct
on the part of the Issuing Bank (as finally  determined  by a court of competent
jurisdiction),  the Issuing Bank shall be deemed to have  exercised  due care in
each such  determination.  In furtherance of the foregoing and without  limiting
the  generality  thereof,  the parties  agree that,  with  respect to  documents
presented  that appear on their face to be in  substantial  compliance  with the
terms of a Letter of  Credit,  the  Issuing  Bank may,  in its sole  discretion,
either accept and make payment upon such documents  without  responsibility  for
further investigation,  regardless of any notice or information to the contrary,
or refuse to accept and make payment upon such  documents if such  documents are
not in strict compliance with the terms of such Letter of Credit.

          (j) Each Letter of Credit shall be subject to the Uniform  Customs and
     Practices for Documentary Credits (1993 Revision), International Chamber of
     Commerce Publication No. 500, as the same may be amended from time to time,
     and, to the extent not  inconsistent  therewith,  the governing law of this
     Agreement set forth in Section 11.5.

Section 2.20. Mitigation of Obligations; Replacement of Lenders.

          (a) If any Lender requests  compensation under Section 2.15, or if the
     Borrower  is  required  to pay any  additional  amount to any Lender or any
     Governmental  Authority  for the account of any Lender  pursuant to Section
     2.17,  then such  Lender  shall  use  reasonable  efforts  to  designate  a
     different  lending office for funding or booking its Loans  hereunder or to
     assign its  rights and  obligations  hereunder  to another of its  offices,
     branches  or  affiliates,  if, in the sole  judgment of such  Lender,  such
     designation  or assignment (i) would  eliminate or reduce  amounts  payable
     under  Section 2.15 or Section  2.17, as the case may be, in the future and
     (ii) would not subject such Lender to any unreimbursed  cost or expense and
     would not otherwise be  disadvantageous to such Lender. The Borrower hereby
     agrees to pay all costs and expenses  incurred by any Lender in  connection
     with such designation or assignment.

          (b) If any Lender requests  compensation under Section 2.15, or if the
     Borrower  is  required  to pay any  additional  amount to any Lender or any
     Governmental  Authority  of the  account of any Lender  pursuant to Section
     2.17, or if any Lender defaults in its obligation to fund Loans  hereunder,
     then the Borrower may, at its sole expense and effort,  upon notice to such
     Lender and the  Administrative  Agent,  require  such  Lender to assign and
     delegate,   without  recourse  (in  accordance  with  and  subject  to  the
     restrictions  set forth in Section  11.4(b) all its  interests,  rights and
     obligations  under this  Agreement  to an assignee  that shall  assume such
     obligations (which assignee may be another Lender);  provided, that (i) the
     Borrower   shall  have   received   the  prior   written   consent  of  the
     Administrative  Agent,  which consent shall not be  unreasonably  withheld,
     (ii) such  Lender  shall have  received  payment of an amount  equal to the
     outstanding  principal  amount of all Loans  owed to it,  accrued  interest
     thereon,  accrued fees and all other amounts payable to it hereunder,  from
     the  assignee  (in the  case  of such  outstanding  principal  and  accrued
     interest)  and from the  Borrower  (in the case of all other  amounts)  and
     (iii)  in the  case of a  claim  for  compensation  under  Section  2.15 or
     payments required to be made pursuant to Section 2.17, such assignment will
     result in a reduction in such compensation or payments.  A Lender shall not
     be required to make any such  assignment  and delegation if, prior thereto,
     as a result of a waiver  by such  Lender or  otherwise,  the  circumstances
     entitling the Borrower to require such  assignment and delegation  cease to
     apply.


Section 2.21. Increase of Commitments; Additional Lenders.

          (a) So long as no Event of Default  has  occurred  and is  continuing,
     from time to time after the Closing Date, Borrower may, upon written notice
     to the Administrative Agent, who shall promptly notify the Lenders, propose
     to  increase  the  Aggregate  Commitments  up to an  amount  not to  exceed
     $450,000,000 (the amount of any such increase,  the "Additional  Commitment
     Amount").  Each  Lender  shall  have  the  right  for a  period  of 15 days
     following  receipt  of such  notice,  to elect  by  written  notice  to the
     Borrower  and the  Administrative  Agent to increase  its  Commitment  by a
     principal  amount equal to its Pro Rata Share of the Additional  Commitment
     Amount.  In the event that the  aggregate  amount to which the  Lenders are
     willing to increase the Commitments is less than the Additional  Commitment
     Amount  based  on the  written  notices  delivered  by the  Lenders  to the
     Administrative  Agent, the Administrative  Agent shall offer to the Lenders
     who have agreed to increase their  Commitments  the  opportunity to further
     increase  their  Commitments  up to  an  amount  equal  to  the  Additional
     Commitment  Amount.  Each such Lender shall promptly  respond in writing to
     the  Administrative  Agent of whether it will agree to further increase its
     Commitment  and by what  amount  it will  agree  to  further  increase  its
     Commitment.  Within five (5) Business  Days after  receipt of all responses
     from such Lenders,  the Administrative  Agent shall inform the Borrower and
     all Lenders in writing of the amount by which each Lender will increase its
     Commitment.  No Lender (or any successor thereto) shall have any obligation
     to increase its  Commitment or its other  obligations  under this Agreement
     and the other Loan Documents,  and any decision by a Lender to increase its
     Commitment  shall be made in its  sole  discretion  independently  from any
     other  Lender.  Decisions  to increase a Commitment  must be  affirmatively
     communicated  in writing and shall not be presumed  based upon a failure to
     respond to Borrower's request.

          (b) If the  existing  Lenders do not elect to increase  the  Aggregate
     Commitments by the Additional  Commitment Amount pursuant to subsection (a)
     of this Section, the Borrower shall have the right, within ninety days (90)
     after  receipt of such  notice  from the  Administrative  Agent,  to obtain
     additional   Commitments   from  one  or  more  other  banks  or  financial
     institutions  (each,  an  "Additional  Lender") to the extent  necessary to
     increase the Aggregate  Commitments  by the Additional  Commitment  Amount;
     provided,  however,  that each Additional  Lender must (i) be acceptable to
     the Administrative Agent and (ii) become a party to this Agreement pursuant
     to  a  joinder  agreement  in  form  and  substance   satisfactory  to  the
     Administrative  Agent.  The sum of the increases in the  Commitments of the
     existing  Lenders  pursuant to subsection  (a) plus the  Commitments of the
     Additional  Lenders  shall  not  in the  aggregate  exceed  the  Additional
     Commitment Amount.

          (c) Increases in the aggregate  amount of the Commitments  pursuant to
     this  Section  2.21  shall  become   effective  upon  the  receipt  by  the
     Administrative  Agent of each agreement in form and substance  satisfactory
     to the  Administrative  Agent signed by the  Borrower,  by each  Additional
     Lender  and by each  other  Lender  whose  Commitment  is to be  increased,
     setting  forth the new  Commitments  of such Lenders and setting  forth the
     agreement of each Additional Lender to become a party to this Agreement and
     to be bound by all the  terms and  provisions  hereof,  together  with such
     evidence of appropriate corporate authorization on the part of the Borrower
     with  respect to the  increase  in the  Commitments  and such  opinions  of
     counsel for the Borrower with respect to the increase in the Commitments as
     the Administrative Agent may reasonably request. Upon the acceptance of any
     such agreement by the Administrative Agent, the Aggregate Commitments shall
     automatically  be increased by the amount of the Commitments  added through
     such agreement and Annex I shall automatically be deemed amended to reflect
     the  Commitments of all Lenders after giving effect to the addition of such
     Commitments.

          (d) Upon any  increase  in the  aggregate  amount  of the  Commitments
     pursuant to this Section  2.21 that is not pro rata among all Lenders,  (x)
     effective upon such increase,  the Borrower shall be deemed to have prepaid
     all  outstanding  Loans in their  entirety  and  reborrowed  Loans from the
     Lenders in proportion to their respective  Commitments  after giving effect
     to such increase and (y) effective  upon such  increase,  the amount of the
     participations   held  by  each  Lender  in  each  Letter  of  Credit  then
     outstanding shall be deemed adjusted such that, after giving effect to such
     adjustments,  the Lenders shall hold  participations in each such Letter of
     Credit in the proportion its respective  Commitment  bears to the aggregate
     Commitments after giving effect to such increase.


                   Article III CONDITIONS PRECEDENT TO LOANS

Section 3.1. Conditions To Effectiveness.

     The  obligations  of the  Lenders to make Loans and the  obligation  of the
Issuing Bank to issue any Letter of Credit  hereunder shall not become effective
until the date on which each of the following conditions is satisfied (or waived
in accordance with Section 11.2).

          (a) The  Administrative  Agent shall have  received all fees and other
     amounts due and payable under the Loan  Documents and the Fee Letters on or
     prior to the  Closing  Date,  including  reimbursement  or  payment  of all
     out-of-pocket    expenses   (including   reasonable   fees,   charges   and
     disbursements  of  counsel  to the  Administrative  Agent)  required  to be
     reimbursed  or paid by the  Borrower,  under any Loan  Document  or the Fee
     Letters.

          (b) The Administrative  Agent (or its counsel) shall have received the
     following,  each in the form specified or, if no form is specified, in form
     and substance satisfactory to the Administrative Agent:

               (i) a  counterpart  of this  Agreement  signed by or on behalf of
          each  party   thereto  or  written   evidence   satisfactory   to  the
          Administrative  Agent (which may include  telecopy  transmission  of a
          signed  signature page of this Agreement) that such party has signed a
          counterpart of this Agreement;

               (ii) if requested  by any Lender,  a Note payable to such Lender,
          duly executed by the Borrower;

               (iii) a counterpart of the Subsidiary Guarantee  Agreement,  duly
          executed by each Guarantor;

               (iv) a certificate of the Secretary or Assistant Secretary of the
          General Partner and each Loan Party,  attaching and certifying  copies
          of its  Constituent  Documents and of the  resolutions of its board of
          directors  (or  other  comparable  authorizations),   authorizing  the
          execution,  delivery and performance of the Loan Documents to which it
          is a party and certifying  the name,  title and true signature of each
          officer of the General  Partner and such Loan Party executing the Loan
          Documents to which it is a party;

               (v)  certificates of good standing or existence,  as the case may
          be, from the Secretary of State of the jurisdiction of organization of
          the General  Partner  and each Loan Party and each other  jurisdiction
          where the General  Partner or each such Loan Party is (x)  required to
          be qualified to do business as a foreign  corporation,  partnership or
          limited liability company,  as the case may be, or (y) owns, leases or
          operates common carrier pipeline assets;

               (vi) a favorable written opinion of Fulbright & Jaworski, L.L.P.,
          counsel to the General Partner and the Loan Parties,  addressed to the
          Administrative  Agent and each of the  Lenders,  substantially  in the
          form of Exhibit F;

               (vii) a  certificate,  dated  the  Closing  Date and  signed by a
          Responsible  Officer of the Borrower,  confirming  compliance with the
          conditions set forth in clauses (i) and (ii) of Section 3.2;

               (viii) a certificate  of the Secretary or Assistant  Secretary of
          the  Borrower,  attaching  and  certifying  copies  of  all  consents,
          approvals,  authorizations,   registrations  and  filings  and  orders
          required or advisable to be made or obtained under any  Requirement of
          Law, or by any contractual or legal  obligation of the General Partner
          or each  Loan  Party,  in  connection  with the  execution,  delivery,
          performance,  validity and enforceability of the Loan Documents or any
          of  the  transactions   contemplated   thereby,   and  such  consents,
          approvals, authorizations,  registrations, filings and orders shall be
          in full force and effect and all applicable waiting periods shall have
          expired and no investigation or inquiry by any Governmental  Authority
          regarding any transaction contemplated hereby shall be ongoing;

               (ix) Copies of the audited  consolidated  financial statements of
          KPP and its  Subsidiaries  for the fiscal  years  ending  December 31,
          2000, 2001 and 2002;

               (x) a duly executed Notice of Borrowing;

               (xi) a duly executed funds disbursement agreement;

               (xii) evidence that all outstanding  "Obligations" (as defined in
          the Existing  Revolving Credit  Agreement) will be repaid in full upon
          funding of the initial  Loan and that the  Existing  Revolving  Credit
          Agreement  will  be  terminated  on the  Closing  Date,  in  form  and
          substance satisfactory to the Administrative Agent

               (xiii) evidence that all outstanding "Obligations" (as defined in
          the Bridge Loan  Agreement) will be repaid in full upon funding of the
          initial Loan and that the Bridge Loan  Agreement will be terminated on
          the  Closing  Date,  in  form  and  substance   satisfactory   to  the
          Administrative Agent; and

               (xiv)  certificates of insurance  issued on behalf of insurers of
          the Borrower and all Guarantors,  describing in reasonable  detail the
          types and amounts of insurance (property and liability)  maintained by
          the Borrower and all Guarantors.

Section 3.2. Each Credit Event.

     The  obligation  of  each  Lender  to make a Loan  on the  occasion  of any
Borrowing and of the Issuing Bank to issue, amend, renew or extend any Letter of
Credit is subject to the satisfaction of the following conditions:

          (i) at the  time  of and  immediately  after  giving  effect  to  such
     Borrowing or the issuance,  amendment,  renewal or extension of such Letter
     of  Credit,  as  applicable,  no  Default  or Event of  Default  shall have
     occurred and be continuing; and

          (ii) all  representations  and warranties of each Loan Party set forth
     in the Loan  Documents  to which each such Loan  Party is a party  shall be
     true and  correct in all  material  respects  on and as of the date of such
     Borrowing or the date of issuance, amendment,  extension or renewal of such
     Letter of Credit, in each case before and after giving effect thereto;

          (iii) since the date of the  financial  statements of KPP described in
     Section  4.4,  there  shall  have  been no  change  which  has had or could
     reasonably be expected to have a Material Adverse Effect;

          (iv) the Administrative Agent shall have received Notice of Borrowing,
     duly completed, executed and delivered in accordance with the terms hereof;
     and

          (v) the Administrative Agent shall have received such other documents,
     certificates,  information or legal opinions as the Administrative Agent or
     the Required  Lenders may  reasonably  request,  all in form and  substance
     reasonably  satisfactory  to  the  Administrative  Agent  or  the  Required
     Lenders.

     Each  Borrowing and each issuance,  amendment,  extension or renewal of any
Letter of Credit shall be deemed to constitute a representation  and warranty by
the Borrower on the date thereof as to the matters  specified in clauses (i) and
(ii) of this Section 3.2.

Section 3.3. Delivery of Documents.

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

                   Article IV REPRESENTATIONS AND WARRANTIES


     Each of the Borrower and KPP represents and warrants to the  Administrative
Agent and each Lender as follows:

Section 4.1. Existence; Power.

     The General Partner and each Loan Party and each of its Subsidiaries (i) is
duly  organized,  validly  existing  and  in  good  standing  as a  corporation,
partnership or limited  liability  company under the laws of the jurisdiction of
its  organization,  (ii) has all  requisite  power and authority to carry on its
business as now conducted,  and (iii) is duly qualified to do business and is in
good standing in each jurisdiction where such qualification is required,  except
where a failure to be so qualified could not reasonably be expected to result in
a Material Adverse Effect.

Section 4.2. Organizational Power; Authorization; Enforceability.

     The execution,  delivery and  performance  by the General  Partner and each
Loan Party of the Loan  Documents  to which it is a party are within the General
Partner's  or such  Loan  Party's  organizational  powers  and  have  been  duly
authorized by all necessary organizational, and if required, stockholder, member
or partner (as  applicable),  action.  This Agreement has been duly executed and
delivered by the General Partner,  KPP and the Borrower,  and  constitutes,  and
each other Loan  Document to which any Loan Party is a party,  when executed and
delivered  by such Loan Party,  will  constitute,  the legal,  valid and binding
obligation  of KPP,  the  Borrower  or such  Loan  Party  (as the  case may be),
enforceable against KPP, the Borrower or such Loan Party (as the case may be) in
accordance with its respective terms.

Section 4.3. Governmental Approvals; No Conflicts.

     The  execution,  delivery and  performance  by each Loan Party of each Loan
Document to which it is a party (i) do not  require any consent or approval  of,
registration  or filing  with,  or any action by,  any  Governmental  Authority,
except  those as have been  obtained  or made and are in full force and  effect,
(ii) will not violate any  Requirements of Law or the  Constituent  Documents of
such Loan Party or any of its  Subsidiaries or any judgment,  order or ruling of
any Governmental Authority,  (iii) will not violate or result in a default under
any indenture,  material agreement or other material  instrument binding on such
Loan  Party or any of its  Subsidiaries  or any of its  assets or give rise to a
right  thereunder to require any payment to be made by such Loan Party or any of
its  Subsidiaries  and (iv) will not result in the creation or imposition of any
Lien on any asset of such Loan Party or any of its  Subsidiaries,  except  Liens
(if any) created under the Loan Documents.

Section 4.4. Financial Statements.

     The Borrower has furnished to each Lender the audited  consolidated balance
sheet of KPP and its  Subsidiaries  as of  December  31,  2002  and the  related
consolidated  statements of income,  shareholders' equity and cash flows for the
fiscal year then ended prepared by KPMG LLP, certified by a Responsible  Officer
of KPP. Such  financial  statements  fairly present the  consolidated  financial
condition  of KPP and its  Subsidiaries  as of such  date  and the  consolidated
results of  operations  for such  period in  conformity  with GAAP  consistently
applied. Since December 31, 2002, there have been no changes with respect to KPP
and its  Subsidiaries  or the  Borrower  which have had or could  reasonably  be
expected to have, singly or in the aggregate, a Material Adverse Effect.

Section 4.5. Litigation and Environmental Matters.

          (a) No  litigation,  investigation  or  proceeding  of or  before  any
     arbitrators  or  Governmental  Authorities  is pending  against  or, to the
     knowledge of the Borrower,  threatened  against or affecting any Loan Party
     or any of its  Subsidiaries  (i) that could reasonably be expected to have,
     either individually or in the aggregate,  a Material Adverse Effect or (ii)
     that in any manner draws into  question the validity or  enforceability  of
     this Agreement or any other Loan Document.

          (b) Except for the matters  set forth on  Schedule  4.5, no Loan Party
     nor any of its Subsidiaries (i) has failed to comply with any Environmental
     Law or to obtain,  maintain  or comply  with any  permit,  license or other
     approval required under any  Environmental  Law, (ii) has become subject to
     any  Environmental  Liability,  (iii) has received notice of any claim with
     respect to any  Environmental  Liability or (iv) knows of any basis for any
     Environmental Liability,  where any such event or circumstance described in
     clauses (i) through  (iv) above (A) could  reasonably  be expected to have,
     either  individually or in the aggregate,  a Material Adverse Effect or (B)
     in any manner draws into  question the validity or  enforceability  of this
     Agreement or any other Loan Document.

Section 4.6. Compliance with Laws and Agreements.

     Each Loan Party and each of its  Subsidiaries is in compliance with (i) all
Requirements  of Law and all judgments,  decrees and orders of any  Governmental
Authority, and (ii) all indentures, agreements or other instruments binding upon
it or its  properties,  except  where  non-compliance,  either  singly or in the
aggregate,  could not  reasonably  be expected  to result in a Material  Adverse
Effect.

Section 4.7. Investment Company Act, Etc.

     Neither KPP nor any of its Subsidiaries is (i) an "investment  company", as
defined in, or subject to regulation under, the Investment  Company Act of 1940,
as amended,  (ii) a "holding  company"  as defined in, or subject to  regulation
under,  the Public  Utility  Holding  Company  Act of 1935,  as amended or (iii)
otherwise  subject to any other regulatory  scheme limiting its ability to incur
debt or requiring any approval or consent from or  registration  or filing with,
any Governmental Authority in connection herewith.

Section 4.8. Taxes.

     KPP and its  Subsidiaries  and each other  Person the taxes of which KPP or
any  Subsidiary  of KPP could  become  liable have timely  filed or caused to be
filed all Federal income tax returns and all other material tax returns that are
required  to be filed  by them,  and  have  paid all  taxes  shown to be due and
payable on such  returns or on any  assessments  made against it or its property
and all other taxes,  fees or other charges imposed on it or any of its property
by any  Governmental  Authority,  except (i) to the extent the  failure to do so
would not have a Material  Adverse  Effect or (ii) where the same are  currently
being  contested in good faith by appropriate  proceedings  and for which KPP or
such  Subsidiary,  as the  case may be,  has set  aside  on its  books  adequate
reserves in  accordance  with GAAP.  The  charges,  accruals and reserves on the
books of KPP and its Subsidiaries in respect of such taxes are adequate,  and no
tax liabilities that could be materially in excess of the amount so provided are
anticipated.

Section 4.9. Margin Regulations.

     None  of the  proceeds  of any of the  Loans  will  be  used,  directly  or
indirectly,   for  "purchasing"  or  "carrying"  any  "margin  stock"  with  the
respective  meanings  of each of such terms under  Regulation  U as now and from
time to time hereafter in effect or for any purpose that violates the provisions
of the Regulation U. Neither KPP nor its Subsidiaries is engaged principally, or
as one of its important activities,  in the business of extending credit for the
purpose of purchasing or carrying "margin stock."

Section 4.10. ERISA.

     No ERISA Event has occurred or is reasonably  expected to occur that,  when
taken together with all other such ERISA Events, could reasonably be expected to
result in a  Material  Adverse  Effect.  The  present  value of all  accumulated
benefit  obligations under each Plan (based on the assumptions used for purposes
of Statement of Financial  Standards No. 87) did not, as of the date of the most
recent  financial  statements  reflecting  such  amounts,  exceed  by more  than
$5,000,000  the fair  market  value of the assets of such Plan,  and the present
value of all accumulated  benefit obligations of all underfunded Plans (based on
the  assumptions  used for purposes of Statement of Financial  Standards No. 87)
did not, as of the date of the most recent financial statements  reflecting such
amounts,  exceed by more than  $5,000,000 the fair market value of the assets of
all such underfunded Plans.

Section 4.11. Ownership of Property.

          (a) Each Loan Party and its  Subsidiaries  has good title to, or valid
     leasehold  interests in, all of its real and personal  property material to
     the operation of its business,  including all such properties  reflected in
     the most recent  audited  consolidated  balance sheet of KPP referred to in
     Section 4.4 or  purported  to have been  acquired by KPP or any  Subsidiary
     after said date  (except as sold or  otherwise  disposed of in the ordinary
     course of business), in each case free and clear of Liens, other than Liens
     permitted  under  Section  7.2.  All  leases  that  individually  or in the
     aggregate  are  material  to the  business  or  operations  of KPP  and its
     Subsidiaries are valid and subsisting and are in full force.

          (b) Each Loan Party and its  Subsidiaries  owns,  or is  licensed,  or
     otherwise has the right,  to use, all patents,  trademarks,  service marks,
     tradenames,  copyrights  and other  intellectual  property  material to its
     business,  and the use thereof by such Loan Party and its Subsidiaries does
     not  infringe  on the  rights  of any  other  Person,  except  for any such
     infringements  that,  individually  or in the  aggregate,  would not have a
     Material Adverse Effect.

Section 4.12. Disclosure.

     The Borrower has disclosed to the Lenders all  agreements,  instruments and
corporate  or  other  restrictions  to  which  each  Loan  Party  or  any of its
Subsidiaries  is  subject,  and all other  matters  known to any of them,  that,
individually  or in the aggregate,  could  reasonably be expected to result in a
Material  Adverse  Effect.  Neither the  Information  Memorandum  nor any of the
reports  (including without limitation all reports that the Borrower is required
to file with the  Securities  and Exchange  Commission),  financial  statements,
certificates or other information furnished by or on behalf of any Loan Party to
the  Administrative  Agent or any Lender in connection  with the  negotiation or
syndication of this Agreement or any other Loan Document or delivered  hereunder
or  thereunder  (as  modified  or  supplemented  by  any  other  information  so
furnished)  contains  any  material  misstatement  of fact or omits to state any
material fact necessary to make the  statements  therein,  taken as a whole,  in
light of the circumstances under which they were made, not misleading; provided,
that with respect to projected  financial  information,  the Borrower represents
only that such  information  was  prepared in good faith based upon  assumptions
believed to be reasonable at the time.

Section 4.13. Labor Relations.

     There  are no  strikes,  lockouts  or  other  material  labor  disputes  or
grievances  against  any  Loan  Party  or any of its  Subsidiaries,  or,  to the
Borrower's  knowledge,  threatened against or affecting any Loan Party or any of
its  Subsidiaries,   and  no  significant  unfair  labor  practice,  charges  or
grievances are pending  against the Borrower or any of its  Subsidiaries,  or to
the Borrower's knowledge, threatened against any of them before any Governmental
Authority.  All  payments  due from any  Loan  Party or any of its  Subsidiaries
pursuant to the provisions of any collective bargaining agreement have been paid
or accrued as a liability on the books of such Loan Party or such Subsidiary (as
applicable),  except where the failure to do so could not reasonably be expected
to have a Material Adverse Effect.

Section 4.14. Insolvency.

     After giving effect to the  execution  and delivery of the Loan  Documents,
the  making  of the  Loans  under  this  Agreement,  neither  KPP nor any of its
Subsidiaries will be "insolvent,"  within the meaning of such term as defined in
ss. 101 of Title 11 of the United  States Code, as amended from time to time, or
be  unable to pay its debts  generally  as such  debts  become  due,  or have an
unreasonably  small  capital to engage in any business or  transaction,  whether
current or contemplated

Section 4.15. Subsidiaries, Significant Affiliates and Guarantors.

     Schedule 4.15 sets forth the name of, the ownership interest of KPP in, the
jurisdiction  of  incorporation  or  organization  of,  and the  type  of,  each
Subsidiary of KPP and each Significant  Affiliate and identifies each Subsidiary
of KPP and each Significant  Affiliate that is a Guarantor,  in each case, as of
the date hereof.


                        Article V AFFIRMATIVE COVENANTS


     KPP and the Borrower (as applicable) covenant and agree that so long as any
Lender has a Commitment  hereunder or the  principal of and interest on any Loan
or any fee or any other amount payable hereunder remains unpaid:

Section 5.1. Financial Statements and Other Information.

     The Borrower will deliver to the Administrative Agent and each Lender:

          (a) as soon as  available  and in any event  within 100 days after the
     end of each  fiscal  year of KPP, a copy of the annual  audited  report for
     such fiscal year for KPP and its  Subsidiaries,  containing a  consolidated
     balance sheet of KPP and its Subsidiaries as of the end of such fiscal year
     and the related consolidated statements of income, stockholders' equity and
     cash  flows   (together  with  all  footnotes   thereto)  of  KPP  and  its
     Subsidiaries  for  such  fiscal  year,   setting  forth  in  each  case  in
     comparative  form  the  figures  for  the  previous  fiscal  year,  all  in
     reasonable detail and reported on by KPMG LLP or other  independent  public
     accountants of nationally recognized standing (without a "going concern" or
     like qualification,  exception or explanation and without any qualification
     or exception  as to scope of such audit) to the effect that such  financial
     statements present fairly in all material respects the financial  condition
     and the results of operations of KPP and its  Subsidiaries  for such fiscal
     year  on a  consolidated  basis  in  accordance  with  GAAP  and  that  the
     examination  by such  accountants  in  connection  with  such  consolidated
     financial statements has been made in accordance with GAAP;

          (b) as soon as available and in any event within 55 days after the end
     of each of the first three  fiscal  quarters of each fiscal year of KPP, an
     unaudited  consolidated balance sheet of KPP and its Subsidiaries as of the
     end  of  such  fiscal  quarter  and  the  related  unaudited   consolidated
     statements  of income and cash flows of KPP and its  Subsidiaries  for such
     fiscal  quarter and the then elapsed  portion of such fiscal year,  setting
     forth in each case in  comparative  form the figures for the  corresponding
     quarter and the  corresponding  portion of KPP's previous  fiscal year, all
     certified  by a  Responsible  Officer  of KPP as  presenting  fairly in all
     material respects the financial  condition and results of operations of KPP
     and its  Subsidiaries  on a  consolidated  basis in  accordance  with GAAP,
     subject to normal year-end audit adjustments and the absence of footnotes;

          (c)  concurrently  with  the  delivery  of  the  financial  statements
     referred to in  subsections  (a) and (b) above,  a  Compliance  Certificate
     signed by a Responsible Officer of the Borrower;

          (d)  concurrently  with  the  delivery  of  the  financial  statements
     referred to in subsection (a) above,  a certificate of the accounting  firm
     that reported on such financial  statements stating whether it obtained any
     knowledge during the course of its examination of such financial statements
     of any Default or Event of Default (which certificate may be limited to the
     extent required by accounting rules or guidelines);

          (e) promptly after the same become publicly  available,  copies of all
     periodic and other reports, proxy statements and other materials filed with
     the  Securities  and Exchange  Commission,  or any  Governmental  Authority
     succeeding to any or all functions of said Commission, or with any national
     securities exchange,  or distributed by KPP or the Borrower to its security
     holders generally;

          (f) promptly  after the same shall be filed with the Internal  Revenue
     Service, copies of IRS Form 8886 (or any successor form) related to the tax
     structure  and  tax  treatment  of the  transactions  contemplated  by this
     Agreement; and

          (g) promptly  following any request  therefor,  such other information
     regarding  the  results  of  operations,  business  affairs  and  financial
     condition of KPP, the Borrower or of their  respective  Subsidiaries as the
     Administrative Agent or any Lender may reasonably request.

Section 5.2. Notices of Material Events.

     The  Borrower  will  furnish to the  Administrative  Agent and each  Lender
prompt written notice of the following,  in each case,  accompanied by a written
statement of a Responsible  Officer of the Borrower setting forth the details of
the event or development  requiring such notice and any action taken or proposed
to be taken with respect thereto:

          (a) the occurrence of any Default or Event of Default;

          (b) the filing or commencement of any action, suit or proceeding by or
     before  any  arbitrator  or  Governmental  Authority  against  or,  to  the
     knowledge  of  KPP  or  the  Borrower,  affecting  any  Loan  Party  or any
     Subsidiary  of  any  Loan  Party  that,  if  adversely  determined,   could
     reasonably be expected to result in a Material Adverse Effect;

          (c) the occurrence of any event or any other  development by which any
     Loan Party or any Subsidiary of any Loan Party (i) fails to comply with any
     Environmental Law or to obtain, maintain or comply with any permit, license
     or other  approval  required  under any  Environmental  Law,  (ii)  becomes
     subject to any Environmental Liability,  (iii) receives notice of any claim
     with respect to any Environmental  Liability,  or (iv) becomes aware of any
     basis for any Environmental Liability and in each of the preceding clauses,
     which  individually  or in the aggregate,  could  reasonably be expected to
     result in a Material Adverse Effect;

          (d) the occurrence of any ERISA Event that alone, or together with any
     other ERISA  Events that have  occurred,  could  reasonably  be expected to
     result in liability  of KPP and its  Subsidiaries  in an  aggregate  amount
     exceeding $5,000,000; and

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

Section 5.3. Existence; Conduct of Business.

     KPP and the Borrower will, and will cause each of its  Subsidiaries  to, do
or cause to be done all things necessary to preserve, renew and maintain in full
force and  effect  its legal  existence  and its  respective  rights,  licenses,
permits, privileges, franchises, patents, copyrights, trademarks and trade names
material to the conduct of its business and will  continue to engage in the same
business as presently  conducted or such other  businesses  that are  reasonably
related  thereto;  provided,  that  nothing in this Section  shall  prohibit any
merger, consolidation, liquidation or dissolution permitted under Section 7.3.

Section 5.4. Compliance with Laws, Etc.

     KPP and the  Borrower  will,  and will cause each of its  Subsidiaries  to,
comply with all laws,  rules,  regulations and  requirements of any Governmental
Authority  applicable  to its  properties,  except  where the  failure to do so,
either  individually  or in the  aggregate,  could not reasonably be expected to
result in a Material Adverse Effect.

Section 5.5. Payment of Obligations.

     KPP and the Borrower will, and will cause each of its  Subsidiaries to, pay
and discharge at or before  maturity,  all of its  obligations  and  liabilities
(including  without  limitation all tax liabilities and claims that could result
in a statutory  Lien)  before the same shall  become  delinquent  or in default,
except where (i) the validity or amount thereof is being contested in good faith
by  appropriate  proceedings,  (ii) KPP or such  Subsidiary has set aside on its
books adequate  reserves with respect  thereto in accordance with GAAP and (iii)
the  failure to make  payment  pending  such  contest  could not  reasonably  be
expected to result in a Material Adverse Effect.

Section 5.6. Books and Records.

     KPP and the Borrower will, and will cause each of its Subsidiaries to, keep
proper books of record and account in which full, true and correct entries shall
be made of all  dealings  and  transactions  in  relation  to its  business  and
activities  to the  extent  necessary  to  prepare  the  consolidated  financial
statements of Borrower in conformity with GAAP.

Section 5.7. Visitation, Inspection, Etc.

     KPP and the  Borrower  will,  and will cause each of its  Subsidiaries  to,
permit any  representative of the  Administrative  Agent or any Lender, to visit
and inspect its properties,  to examine its books and records and to make copies
and take extracts therefrom,  and to discuss its affairs,  finances and accounts
with any of its officers and with its independent  certified public accountants,
all at such  reasonable  times and as often as the  Administrative  Agent or any
Lender may reasonably  request after reasonable  prior notice to KPP;  provided,
however, if an Event of Default has occurred and is continuing,  no prior notice
shall be required.

Section 5.8. Maintenance of Properties; Insurance.

     KPP and the Borrower will, and will cause each of its  Subsidiaries to, (i)
keep and maintain  all property  material to the conduct of its business in good
working order and condition,  except for ordinary wear and tear and except where
the  failure  to do so,  either  individually  or in the  aggregate,  could  not
reasonably be expected to result in a Material  Adverse Effect and (ii) maintain
with financially sound and reputable insurance companies, insurance with respect
to  its  properties  and  business,  and  the  properties  and  business  of its
Subsidiaries, against loss or damage of the kinds customarily insured against by
companies  in the same or similar  businesses  operating  in the same or similar
locations.

Section 5.9. Use of Proceeds.

     The  Borrower  will use the  proceeds  of all Loans to  refinance  existing
Indebtedness on the Closing Date and thereafter to fund  acquisitions  permitted
hereunder,  to provide for working capital and general corporate purposes of the
Borrower and its Subsidiaries. No part of the proceeds of any Loan will be used,
whether  directly or indirectly,  for any purpose that would violate any rule or
regulation of the Board of Governors of the Federal  Reserve  System,  including
Regulation  T, U or X. All Letters of Credit will be used for general  corporate
purposes.

Section 5.10. Additional Subsidiaries.

     If  any  additional   Significant   Subsidiary  (other  than  any  Excluded
Subsidiary  and any Foreign  Subsidiary)  is  acquired or formed  after the date
hereof, KPP will, within ten business days after such Significant  Subsidiary is
acquired or formed,  notify the Administrative Agent and the Lenders thereof and
will  cause such  Significant  Subsidiary  to become a  Guarantor  by  executing
agreements  in the form of Annex I to Exhibit C and will cause such  Significant
Subsidiary to deliver  simultaneously  therewith such  certificates,  documents,
opinions of counsel  and other  information  regarding  such  Guarantor  and the
enforceability  against such Guarantor of the Subsidiary  Guarantee Agreement as
the Administrative Agent may reasonably request.

                         Article VI FINANCIAL COVENANTS


     KPP and the Borrower (as applicable) covenant and agree that so long as any
Lender has a Commitment hereunder or the principal of or interest on or any Loan
remains unpaid or any fee or any other amount payable hereunder remains unpaid:

Section 6.1. Leverage Ratio.

     KPP and its Subsidiaries will maintain at all times a Leverage Ratio of not
more than 4.25:1.00;  provided, however, that if the Borrower consummates within
a six-month period one or more acquisitions  permitted under Section 7.4 with an
aggregate purchase price in excess of $50,000,000 (collectively, the "Adjustment
Acquisition"), then KPP and its Subsidiaries may maintain at all time during the
period  beginning on the date of the  Adjustment  Acquisition  and ending on the
last day of the second fiscal quarter  ending  thereafter  (the "Adjusted  Ratio
Period") a Leverage  Ratio in excess of 4.25:1.00  but not more than  4.50:1.00;
provided,  further,  that no acquisition shall be counted toward requirements of
more than one Adjusted Ratio Period.

Section 6.2. Consolidated EBITDA to Consolidated Interest Expense.

     KPP and its  Subsidiaries  will maintain a ratio of Consolidated  EBITDA to
Consolidated  Interest  Expense of not less than  3.00:1.00,  measured,  in each
case, for the  four-fiscal  quarter period ending on the last day of each fiscal
quarter.

Section 6.3. Consolidated Net Worth.

     KPP will not permit its  Consolidated Net Worth at any time to be less than
an amount  equal to (i) 80% of the  Consolidated  Net Worth as at  December  31,
2002,  plus (ii) 80% of the Net Cash  Proceeds of any Equity Event by KPP or any
of its Subsidiaries.

                         Article VII NEGATIVE COVENANTS


     Each of KPP and  the  Borrower  covenants  and  agrees  that so long as any
Lender has a Commitment hereunder or the principal of or interest on any Loan or
any Letter of Credit remains unpaid, outstanding or unreimbursed,  or any fee or
any other amount payable hereunder remains unpaid:

Section 7.1. Indebtedness.

     KPP and the  Borrower  will not,  and will not  permit any  Subsidiary  to,
create, incur, assume or suffer to exist any Indebtedness, except:

          (a) Indebtedness created pursuant to the Loan Documents and, until the
     application  of  the  proceeds  of  the  initial  Loans,  the  Indebtedness
     outstanding  under the Bridge Loan  Agreement  and the  Existing  Revolving
     Credit Agreement; and

          (b)  Indebtedness  of  Subsidiaries  of KPP (other than the  Borrower)
     existing on the date hereof and set forth on Schedule  7.1 and  extensions,
     renewals and replacements of any such Indebtedness that do not increase the
     outstanding principal amount thereof (immediately prior to giving effect to
     such  extension,  renewal or  replacement)  or shorten the  maturity or the
     weighted average life thereof;

          (c)  Indebtedness  of  Subsidiaries  of KPP (other than the  Borrower)
     incurred to finance the  acquisition,  construction  or  improvement of any
     fixed or capital  assets,  including  Capital  Lease  Obligations,  and any
     Indebtedness  assumed in connection with the acquisition of any such assets
     or secured by a Lien on any such assets prior to the  acquisition  thereof;
     provided,  that such  Indebtedness  is incurred  prior to or within 90 days
     after  such   acquisition  or  the  completion  of  such   construction  or
     improvements  or  extensions,   renewals,  and  replacements  of  any  such
     Indebtedness that do not increase the outstanding  principal amount thereof
     (immediately  prior  to  giving  effect  to  such  extension,   renewal  or
     replacement) or shorten the maturity or the weighted  average life thereof;
     provided further,  that the aggregate principal amount of such Indebtedness
     does not exceed $25,000,000 at any time outstanding;

          (d)  Indebtedness  of  Subsidiaries  of KPP (other than the  Borrower)
     owing to the  Borrower  or any other  Subsidiary;  provided,  that any such
     Indebtedness  that is owed to a Subsidiary that is not a Guarantor shall be
     subject to Section 7.4;

          (e)  Guarantees  by  Subsidiaries  of KPP (other than the Borrower) of
     Indebtedness  of the  Borrower  or any  other  Subsidiary;  provided,  that
     Guarantees by any Loan Party of  Indebtedness of any Subsidiary that is not
     a Guarantor shall be subject to Section 7.4;

          (f)  Indebtedness  of any Person which becomes a Subsidiary  after the
     date of this Agreement; provided, that such Indebtedness exists at the time
     that such Person becomes a Subsidiary  and is not created in  contemplation
     of or in connection with such Person becoming a Subsidiary;

          (g)  Indebtedness  in  respect  of Hedging  Obligations  permitted  by
     Section 7.10;

          (h) other  unsecured  Indebtedness  of Subsidiaries of KPP (other than
     the Borrower) in an aggregate principal amount not to exceed $25,000,000 at
     any time outstanding; and

          (i)  other  unsecured   Indebtedness  of  the  Borrower  or  KPP,  the
     incurrence  of which  does not  otherwise  result  in the  occurrence  of a
     Default or an Event of Default.

Section 7.2. Negative Pledge.

     KPP and the  Borrower  will not,  and will not  permit any  Subsidiary  to,
create,  incur,  assume  or  suffer  to exist  any Lien on any of its  assets or
property now owned or hereafter acquired, except:

          (a) Permitted Encumbrances;

          (b) any Liens on any property or asset of KPP or any Subsidiary of KPP
     existing on the date hereof set forth on Schedule 7.2; provided,  that such
     Lien  shall  not apply to any  other  property  or asset of KPP or any such
     Subsidiary;

          (c)  purchase  money  Liens upon or in any fixed or capital  assets to
     secure the purchase  price or the cost of  construction  or  improvement of
     such fixed or capital assets or to secure Indebtedness  incurred solely for
     the purpose of financing the  acquisition,  construction  or improvement of
     such  fixed or capital  assets  (including  Liens  securing  Capital  Lease
     Obligations);  provided,  that (i) such Lien secures Indebtedness permitted
     by  Section   7.1(c)  or  (i),  (ii)  such  Lien  attaches  to  such  asset
     concurrently  or  within  90 days  after the  acquisition,  improvement  or
     completion of the construction thereof;  (iii) such Lien does not extend to
     any other asset; and (iv) the Indebtedness  secured thereby does not exceed
     the cost of  acquiring,  constructing  or  improving  such fixed or capital
     assets;

          (d) any Lien (i)  existing on any asset of any Person at the time such
     Person  becomes a  Subsidiary  of KPP,  (ii)  existing  on any asset of any
     Person at the time such Person is merged with or into KPP or any Subsidiary
     of KPP or (iii) existing on any asset prior to the  acquisition  thereof by
     KPP or any Subsidiary of KPP; provided,  that any such Lien was not created
     in the contemplation of any of the foregoing and any such Lien secures only
     those  obligations  which it secures on the date that such Person becomes a
     Subsidiary or the date of such merger or the date of such acquisition; and

          (e) extensions,  renewals,  or replacements of any Lien referred to in
     subsections (a) through (d) of this Section;  provided,  that the principal
     amount of the  Indebtedness  secured  thereby is not increased and that any
     such extension,  renewal or replacement is limited to the assets originally
     encumbered thereby.

Section 7.3. Fundamental Changes.

          (a) KPP and the Borrower will not, and will not permit any  Subsidiary
     to, merge into or  consolidate  into any other Person,  or permit any other
     Person to merge into or consolidate  with it, or sell,  lease,  transfer or
     otherwise dispose of (in a single  transaction or a series of transactions)
     all or substantially all of its assets (in each case,  whether now owned or
     hereafter  acquired) or all or substantially all of the stock of any of its
     Subsidiaries  (in each case,  whether now owned or  hereafter  acquired) or
     liquidate  or  dissolve;   provided,  that  if  at  the  time  thereof  and
     immediately  after giving  effect  thereto,  no Default or Event of Default
     shall have  occurred and be continuing  (i) any  Subsidiary of the Borrower
     may merge with a Person if such  Subsidiary is the surviving  Person,  (ii)
     any Subsidiary  may merge into another  Subsidiary;  provided,  that if any
     party to such merger is a Guarantor,  the Guarantor  shall be the surviving
     Person, (iii) any Subsidiary of the Borrower may sell,  transfer,  lease or
     otherwise dispose of all or substantially all of its assets to the Borrower
     or to a Guarantor  and (iv) any  Subsidiary  (other than a  Guarantor)  may
     liquidate  or dissolve if the Borrower  determines  in good faith that such
     liquidation  or dissolution is in the best interests of the Borrower and is
     not materially disadvantageous to the Lenders.

          (b) KPP and the  Borrower  will not,  and will not  permit  any of its
     Subsidiaries  to, engage in any business other than  businesses of the type
     conducted  by KPP and its  Subsidiaries  on the date hereof and  businesses
     reasonably related thereto.

Section 7.4. Investments, Loans, Etc.

     KPP and the  Borrower  will not,  and will not  permit any  Subsidiary  to,
purchase, hold or acquire (including pursuant to any merger with any Person that
was not a  wholly-owned  Subsidiary  prior to such  merger),  any common  stock,
evidence of indebtedness or other securities (including any option,  warrant, or
other  right to acquire  any of the  foregoing)  of, make or permit to exist any
loans or advances to,  Guarantee any  obligations of, or make or permit to exist
any  investment  or any other  interest  in,  any other  Person or  purchase  or
otherwise acquire (in one transaction or a series of transactions) any assets of
any other Person (all of the foregoing being collectively called "Investments"),
except:

          (a)  Investments  (other than Permitted  Investments)  existing on the
     date hereof (including Investments in Subsidiaries);

          (b) Permitted Investments;

          (c)  Guarantees  constituting  Indebtedness  permitted by Section 7.1;
     provided,   that  the  aggregate   principal   amount  of  Indebtedness  of
     Subsidiaries  that are not Guarantors that are Guaranteed by any Loan Party
     shall be subject to the limitation set forth in subsection (d) hereof;

          (d)  Investments  made  by  KPP  in or to  any  Subsidiary  and by any
     Subsidiary to the Borrower or in or to another Subsidiary;  provided,  that
     the  aggregate  amount  of  Investments  by  Loan  Parties  in or  to,  and
     Guarantees by Loan Parties of  Indebtedness of any Subsidiary that is not a
     Guarantor  (including all such  Investments and Guarantees  existing on the
     Closing Date) shall not exceed $100,000,000 at any time outstanding;

          (e) other  Investments  made by KPP or any  Subsidiary of KPP (in each
     case,  whether directly or indirectly,  through one or more Subsidiaries of
     KPP or one or more  Excluded  Affiliates),  provided,  that  for  any  such
     Investment  of  at  least  $50,000,000  individually,  and  for  each  such
     Investment  of at least  $10,000,000  individually  if the aggregate of all
     such  Investments  during  any  fiscal  year  of KPP  shall  have  exceeded
     $75,000,000,  KPP shall  first have  provided to the  Administrative  Agent
     financial   statements   of   KPP   and   its   consolidated   Subsidiaries
     demonstrating,  to the reasonable satisfaction of the Administrative Agent,
     that after giving pro forma effect to such  Investment,  KPP shall continue
     to be in compliance with Article VI hereof;

          (f) loans or advances to  employees,  officers or  directors of KPP or
     any  Subsidiary  of KPP in the  ordinary  course of  business  for  travel,
     relocation  and related  expenses;  provided,  however,  that the aggregate
     amount of all such loans and  advances  does not exceed  $1,000,000  at any
     time; and

          (g)  pursuant  to  Hedging  Agreements   permitted  by  Section  7.10.

Section 7.5. Restricted Payments.

     KPP and the Borrower will not, and will not permit any  Subsidiary to, make
or agree to make, directly or indirectly, any Distribution,  or make any payment
on account of, or set apart  assets for a sinking or other  analogous  fund for,
the purchase,  redemption,  retirement,  defeasance or other acquisition of, any
Equity Interests or Indebtedness subordinated to the Obligations of the Borrower
or any options,  warrants,  or other rights to purchase Equity Interests or such
Indebtedness,   whether  now  or  hereafter  outstanding  (each,  a  "Restricted
Payment"),  except  for (i)  Distributions  payable  by KPP solely in its Equity
Interests,  (ii) Restricted  Payments made by any Subsidiary of KPP to KPP or to
another  Subsidiary  of KPP and  (iii)  cash  Distributions  paid  on,  and cash
redemptions of, the Equity Interests of KPP or the Borrower;  provided,  that no
Default or Event of Default has  occurred  and is  continuing,  or would  result
after giving pro forma effect to such  Distribution  or redemption,  at the time
such Distribution is paid or redemption is made.

Section 7.6. Sale of Assets.

     KPP and the Borrower  will not, and will not permit any  Subsidiary  (other
than any Excluded  Subsidiary)  to, convey,  sell,  lease,  assign,  transfer or
otherwise dispose of, any of its assets, business or property, whether now owned
or hereafter acquired, except:

          (a) dispositions of inventory in the ordinary course of business;

          (b)  dispositions  of other assets in the ordinary  course of business
     having a Fair Market Value of not more than  $25,000,000  in the  aggregate
     during  any  fiscal  year of KPP  and  not  more  than  $50,000,000  in the
     aggregate  from the date hereof  until the date three years  following  the
     date of this Agreement; and

          (c)  dispositions  of assets the proceeds of which are  reinvested  in
     other  assets  used by or useful to KPP or such  Significant  Affiliate  in
     conducting its customary  business if (A) a binding purchase,  subscription
     or similar  agreement  relating to such reinvestment is entered into within
     60 days after the receipt of all or substantially  all of the cash proceeds
     from the  disposition  of such  assets,(B)  the Net Cash Proceeds from such
     disposition  are so  reinvested  within 120 days after the  receipt of such
     cash  proceeds and (C) the Required  Lenders  approve the  reinvestment  of
     proceeds  from the sale of  assets  (other  than  inventory)  in  excess of
     $50,000,000.

Section 7.7. Transactions with Affiliates.

     KPP and the Borrower will not, and will not permit any Subsidiary to, sell,
lease or otherwise  transfer  any  property or assets to, or purchase,  lease or
otherwise  acquire any property or assets from, or otherwise engage in any other
transactions  with, any of its Affiliates,  except (i) in the ordinary course of
business at prices and on terms and conditions not less favorable to KPP or such
Subsidiary than could be obtained on an arm's-length  basis from unrelated third
parties,   (ii)   transactions   between  or  among  KPP  and  its  wholly-owned
Subsidiaries  that are Loan Parties,  but not involving any other Affiliates and
(iii) any Restricted Payment permitted by Section 7.5.

Section 7.8. Restrictive Agreements.

     KPP and the Borrower  will not, and will not permit any  Subsidiary  (other
than any Excluded  Subsidiary) to, directly or indirectly,  enter into, incur or
permit to exist any  agreement  (i) that  prohibits,  restricts  or imposes  any
condition upon the ability of any Subsidiary of KPP to make  Distributions  with
respect to its Equity Interests,  to make or repay loans or advances to Borrower
or any Guarantor,  to guarantee  Indebtedness of Borrower or any Guarantor or to
transfer  any of its  property or assets to Borrower or any  Guarantor,  or (ii)
contains any  prohibitions  or  restrictions  on KPP or such Subsidiary that are
more  restrictive  than the covenants  contained in this Agreement or the Senior
Notes  Indenture;   provided,   that  (A)  the  foregoing  shall  not  apply  to
restrictions or conditions  imposed by law or by this Agreement,  any other Loan
Document and the Senior Notes Indenture and (B) the foregoing shall not apply to
customary  restrictions and conditions  contained in agreements  relating to the
sale of any Subsidiary of KPP pending such sale,  provided such restrictions and
conditions  apply only to the Subsidiary that is sold and such sale is permitted
hereunder.

Section 7.9. Sale and Leaseback Transactions.

     KPP and the Borrower  will not, and will not permit any  Subsidiary  (other
than any  Excluded  Subsidiary)  to,  enter into any  arrangement,  directly  or
indirectly,  whereby it shall sell or transfer any  property,  real or personal,
used or useful in its business,  whether now owned or hereinafter acquired,  and
thereafter  rent or lease such property or other property that it intends to use
for  substantially  the  same  purpose  or  purposes  as the  property  sold  or
transferred.

Section 7.10. Hedging Agreements.

     KPP and the Borrower will not, and will not permit any Subsidiary to, enter
into any Hedging  Agreement,  other than Hedging  Agreements entered into in the
ordinary  course of business to hedge or mitigate risks to which KPP or any such
Subsidiary  is exposed in the conduct of its business or the  management  of its
liabilities.  Solely for the avoidance of doubt, KPP acknowledges that a Hedging
Agreement  entered  into for  speculative  purposes or of a  speculative  nature
(which shall be deemed to include any Hedging  Agreement  under which KPP or any
Subsidiary of KPP is or may become obliged to make any payment (A) in connection
with the purchase by any third party of any common stock or any  Indebtedness or
(B) as a result  of  changes  in the  market  value of any  common  stock or any
Indebtedness) is not a Hedging  Agreement entered into in the ordinary course of
business to hedge or mitigate risks.

Section 7.11. Amendment to Material Documents.

     KPP and the  Borrower  will not,  and will not  permit any  Subsidiary  to,
amend,  modify or waive any of its rights in a manner materially  adverse to the
Lenders under its Constituent Documents.

Section 7.12. Accounting Changes.

     KPP and the Borrower will not, and will not permit any  Subsidiary to, make
any significant change in accounting treatment or reporting practices, except as
required by GAAP,  or change the fiscal  year of KPP or of any such  Subsidiary,
except to change the fiscal  year of any such  Subsidiary  to conform its fiscal
year to that of KPP.

                           Article VIII KPP GUARANTEE


     The Borrower is a direct and  wholly-owned  Subsidiary of KPP, and KPP will
derive  substantial  benefit  from the  making of the Loans by the  Lenders.  As
consideration  therefor  and in order to induce the Lenders to make  Loans,  KPP
agrees as follows:

Section 8.1. Guarantee.

     KPP  unconditionally  guarantees,  jointly  with the other  Guarantors  and
severally,  as a primary  obligor  and not  merely as a surety,  (i) the due and
punctual  payment of (A) the  principal  of and  premium,  if any,  and interest
(including interest accruing during the pendency of any bankruptcy,  insolvency,
receivership  or other  similar  proceeding,  regardless  of whether  allowed or
allowable  in  such  proceeding)  on the  Loans,  when  and as due,  whether  at
maturity,  by  acceleration,  upon  one or  more  dates  set for  prepayment  or
otherwise,  (B) each payment  required to be made by the  Borrower  hereunder in
respect of any Letter of Credit,  when and as due, including payments in respect
of reimbursement or  disbursements,  interest thereon and obligations to provide
cash collateral, and (C) all other monetary obligations,  including fees, costs,
expenses and indemnities,  whether primary, secondary, direct, contingent, fixed
or otherwise (including monetary obligations incurred during the pendency of any
bankruptcy, insolvency,  receivership or other similar proceeding, regardless of
whether allowed or allowable in such  proceeding),  of the other Loan Parties to
the  Administrative  Agent and the Lenders  under this  Agreement the other Loan
Documents,  (ii) the due and punctual performance of all covenants,  agreements,
obligations  and liabilities of the other Loan Parties under or pursuant to this
Agreement and the other Loan Documents;  and (iii) the due and punctual  payment
and performance of all obligations of the Borrower, monetary or otherwise, under
each Hedging  Agreement entered into with a counterparty that was a Lender or an
Affiliate  of a Lender at the time  such  Hedging  Agreement  was  entered  into
related to the  Indebtedness  incurred  hereunder  (all the  monetary  and other
obligations  referred  to in the  preceding  clauses  (i)  through  (iii)  being
collectively called the "Guaranteed  Obligations").  KPP further agrees that the
Guaranteed  Obligations may be extended or renewed, in whole or in part, without
notice to or  further  assent  from it, and that it will  remain  bound upon its
guarantee notwithstanding any extension or renewal of any Guaranteed Obligation.

Section 8.2. Guaranteed Obligations Not Waived.

     To the fullest extent  permitted by applicable law, KPP waives  presentment
to,  demand of payment  from and protest to the other Loan Parties of any of the
Guaranteed  Obligations,  and also waives  notice of acceptance of its guarantee
and notice of  protest  for  nonpayment.  To the  fullest  extent  permitted  by
applicable  law, the  obligations of KPP hereunder  shall not be affected by (i)
the  failure  of the  Administrative  Agent or any Lender to assert any claim or
demand or to enforce or exercise any right or remedy against the Borrower or any
other Guarantor under the provisions of this Agreement,  any other Loan Document
or otherwise, (ii) any rescission,  waiver, amendment or modification of, or any
release from any of the terms or provisions of, this  Agreement,  any other Loan
Document or any other  agreement,  including with respect to any other Guarantor
under the Subsidiary  Guarantee  Agreement,  or (iii) the failure to perfect any
security  interest  in, or the  release  of, any of the  security  held by or on
behalf of the Administrative Agent or any Lender.

Section 8.3. Guarantee of Payment.

     KPP further  agrees that its  guarantee  constitutes a guarantee of payment
when due and not of collection,  and waives any right to require that any resort
be had by the Administrative Agent or any Lender to any of the security held for
payment of the Guaranteed  Obligations or to any balance of any deposit  account
or credit on the books of the Administrative Agent or any Lender in favor of the
Borrower or any other Person.

Section 8.4. No Discharge or Diminishment of Guarantee.

     The  obligations  of KPP hereunder  shall not be subject to any  reduction,
limitation,   impairment  or   termination   for  any  reason  (other  than  the
indefeasible payment in full in cash of the Guaranteed  Obligations),  including
any claim of waiver, release, surrender,  alteration or compromise of any of the
Guaranteed  Obligations,  and shall not be  subject  to any  defense  or setoff,
counterclaim,  recoupment or termination whatsoever by reason of the invalidity,
illegality  or  unenforceability  of the  Guaranteed  Obligations  or otherwise.
Without  limiting  the  generality  of the  foregoing,  the  obligations  of KPP
hereunder  shall not be  discharged  or  impaired or  otherwise  affected by the
failure of the Administrative  Agent or any Lender to assert any claim or demand
or to enforce any remedy under this  Agreement,  any other Loan  Document or any
other agreement,  by any waiver or modification of any provision of any thereof,
by any default,  failure or delay,  willful or otherwise,  in the performance of
the Guaranteed Obligations, or by any other act or omission that may or might in
any manner or to any extent vary the risk of KPP or that would otherwise operate
as a  discharge  of a  guarantor  as a matter of law or equity  (other  than the
indefeasible payment in full in cash of all the Guaranteed Obligations).

Section 8.5. Defenses of Borrower Waived.

     To the fullest extent  permitted by applicable  law, KPP waives any defense
based on or arising out of any defense of any Loan Party or the unenforceability
of the  Guaranteed  Obligations  or any  part  thereof  from any  cause,  or the
cessation  from any cause of the  liability  of any Loan  Party,  other than the
final and  indefeasible  payment in full in cash of the Guaranteed  Obligations.
The  Administrative  Agent and the Lenders may, at their election,  foreclose on
any security held by one or more of them by one or more judicial or  nonjudicial
sales,  accept  an  assignment  of any  such  security  in lieu of  foreclosure,
compromise  or adjust  any part of the  Guaranteed  Obligations,  make any other
accommodation  with the  other  Loan  Parties  or any other  guarantor,  without
affecting or impairing in any way the liability of KPP  hereunder  except to the
extent the Guaranteed Obligations have been fully, finally and indefeasibly paid
in cash.  Pursuant to applicable  law, KPP waives any defense arising out of any
such election even though such election operates, pursuant to applicable law, to
impair or to extinguish any right of reimbursement or subrogation or other right
or remedy of KPP against the Borrower or any other  Guarantor or  guarantor,  as
the case may be, or any security.

Section 8.6. Agreement to Pay; Subordination.

     In  furtherance  of the  foregoing and not in limitation of any other right
that the Administrative  Agent or any Lender has at law or in equity against KPP
by virtue  hereof,  upon the failure of the  Borrower or any other Loan Party to
pay any Guaranteed  Obligation when and as the same shall become due, whether at
maturity, by acceleration,  after notice of prepayment or otherwise,  KPP hereby
promises to and will forthwith  pay, or cause to be paid, to the  Administrative
Agent  for  the  benefit  of the  Lenders  in cash  the  amount  of such  unpaid
Guaranteed  Obligations.  Upon payment by KPP of any sums to the  Administrative
Agent,  all rights of KPP against any Loan Party arising as a result  thereof by
way of right of subrogation, contribution, reimbursement, indemnity or otherwise
shall in all respects be subordinate and junior in right of payment to the prior
indefeasible  payment  in full in cash  of all the  Guaranteed  Obligations.  In
addition,  any indebtedness of any other Loan Party now or hereafter held by KPP
is hereby  subordinated in right of payment to the prior payment in full in cash
of the Guaranteed Obligations. If any amount shall erroneously be paid to KPP on
account  of (i) such  subrogation,  contribution,  reimbursement,  indemnity  or
similar  right or (ii) any such  indebtedness  of such Loan  Party,  such amount
shall be held in trust  for the  benefit  of the  Administrative  Agent  and the
Lenders and shall forthwith be paid to the  Administrative  Agent to be credited
against the payment of the Guaranteed Obligations, whether matured or unmatured,
in accordance with the terms of the Loan Documents.

Section 8.7. Information.

     KPP assumes all responsibility for being and keeping itself informed of the
other  Loan  Parties'   financial   condition  and  assets,  and  of  all  other
circumstances bearing upon the risk of nonpayment of the Guaranteed  Obligations
and the  nature,  scope and  extent of the risks  that KPP  assumes  and  incurs
hereunder,  and agrees that none of the Administrative Agent or the Lenders will
have any duty to advise KPP of information  known to it or any of them regarding
such circumstances or risks.

Section 8.8. Termination.

     The guarantees made hereunder (i) shall terminate when all Obligations have
been paid in full in cash and the  Lenders  have no further  commitment  to lend
under this  Agreement,  the LC Exposure has been reduced to zero and the Issuing
Bank has no further  obligation to issue Letters of Credit under this  Agreement
and (ii) shall continue to be effective or be reinstated, as the case may be, if
at any time  payment,  or any part  thereof,  of any  Guaranteed  Obligation  is
rescinded or must  otherwise be restored by any Lender or any Guarantor upon the
bankruptcy or  reorganization  of the Borrower,  any Guarantor or otherwise.  In
connection  with the  foregoing,  the  Administrative  Agent  shall  execute and
deliver to KPP or KPP's designee, at KPP's expense, any documents or instruments
that KPP shall reasonably request from time to time to evidence such termination
and release.

                          Article IX EVENTS OF DEFAULT


Section 9.1. Events of Default.

     If any of the following events (each an "Event of Default") shall occur:

          (a) the Borrower shall fail to pay any principal of any Loan or of any
     reimbursement obligations in respect of any LC Disbursement when and as the
     same shall become due and payable,  whether at the due date thereof or at a
     date fixed for prepayment or otherwise; or

          (b) the Borrower shall fail to pay any interest on any Loan or any fee
     or any other amount (other than an amount  payable under  subsection (a) of
     Section 9.1) payable under this Agreement or any other Loan Document,  when
     and as the same  shall  become  due and  payable,  and such  failure  shall
     continue unremedied for a period of 3 Business Days; or

          (c) any representation or warranty made or deemed made by or on behalf
     of any Loan Party in or in connection with this Agreement or any other Loan
     Document  (including the Schedules  attached thereto) and any amendments or
     modifications hereof or waivers hereunder,  or in any certificate,  report,
     financial statement or other document submitted to the Administrative Agent
     or the  Lenders by any Loan Party or any  representative  of any Loan Party
     pursuant to or in connection with this Agreement or any other Loan Document
     shall prove to be  incorrect  in any  material  respect when made or deemed
     made or submitted; or

          (d) the  Borrower  or KPP,  as  applicable,  shall  fail to observe or
     perform any covenant or agreement  contained in Section 5.2(a) or 5.3 (with
     respect to KPP's or the Borrower's existence) or Article VI or VII; or

          (e) any Loan Party  shall fail to observe or perform  any  covenant or
     agreement  contained in any Loan Document  (other than those referred to in
     subsections  (a),  (b)  and (d)  above),  and  such  failure  shall  remain
     unremedied for 30 days after the earlier of (i) any officer of the Borrower
     becomes aware of such failure, or (ii) notice thereof shall have been given
     to the Borrower by the Administrative Agent or any Lender; or

          (f) the Borrower, KPP or any Significant Affiliate (whether as primary
     obligor or as guarantor or other surety) shall fail to pay any principal of
     or premium or interest on any Material  Indebtedness  that is  outstanding,
     when and as the same shall  become due and payable  (whether  at  scheduled
     maturity, required prepayment, acceleration, demand or otherwise), and such
     failure shall continue after the applicable grace period, if any, specified
     in the agreement or instrument  evidencing such Indebtedness;  or any other
     event  shall  occur  or  condition  shall  exist  under  any  agreement  or
     instrument  relating  to such  Indebtedness  and shall  continue  after the
     applicable grace period, if any, specified in such agreement or instrument,
     if the effect of such event or  condition is to  accelerate,  or permit the
     acceleration   of,  the  maturity  of  such   Indebtedness;   or  any  such
     Indebtedness  shall be  declared to be due and  payable;  or required to be
     prepaid  or  redeemed  (other  than  by  a  regularly   scheduled  required
     prepayment or redemption),  purchased or defeased,  or any offer to prepay,
     redeem, purchase or defease such Indebtedness shall be required to be made,
     in each case prior to the stated maturity thereof; or

          (g) the Borrower,  KPP or any Significant Affiliate shall (i) commence
     a  voluntary  case  or  other  proceeding  or  file  any  petition  seeking
     liquidation,  reorganization  or other relief  under any federal,  state or
     foreign  bankruptcy,  insolvency  or other  similar law now or hereafter in
     effect or  seeking  the  appointment  of a  custodian,  trustee,  receiver,
     liquidator or other similar  official of it or any substantial  part of its
     property,  (ii)  consent  to the  institution  of, or fail to  contest in a
     timely and  appropriate  manner,  any  proceeding or petition  described in
     subsection  (i)  of  this  Section,  (iii)  apply  for  or  consent  to the
     appointment of a custodian,  trustee, receiver, liquidator or other similar
     official for the Borrower,  KPP or any such Significant  Affiliate or for a
     substantial part of its assets,  (iv) file an answer admitting the material
     allegations of a petition filed against it in any such proceeding, (v) make
     a general assignment for the benefit of creditors,  or (vi) take any action
     for the purpose of effecting any of the foregoing; or

          (h) an  involuntary  proceeding  shall be commenced or an  involuntary
     petition shall be filed seeking (i)  liquidation,  reorganization  or other
     relief in respect of the Borrower,  KPP or any Significant Affiliate or its
     debts, or any substantial part of its assets,  under any federal,  state or
     foreign  bankruptcy,  insolvency  or other  similar law now or hereafter in
     effect  or  (ii)  the  appointment  of  a  custodian,   trustee,  receiver,
     liquidator  or  other  similar  official  for  the  Borrower,  KPP  or  any
     Significant  Affiliate or for a substantial part of its assets,  and in any
     such case,  such  proceeding  or petition  shall remain  undismissed  for a
     period of 60 days or an order or decree  approving  or ordering  any of the
     foregoing shall be entered; or

          (i) the  Borrower,  KPP or any  Significant  Subsidiary  shall  become
     unable to pay,  shall admit in writing its  inability to pay, or shall fail
     to pay, its debts as they become due; or

          (j) an ERISA Event  shall have  occurred  that,  in the opinion of the
     Required  Lenders,  when taken  together  with other ERISA Events that have
     occurred,  could  reasonably  be  expected  to result in  liability  to the
     Borrower and the Subsidiaries in an aggregate amount exceeding  $5,000,000;
     or

          (k) any  judgment  or order  for the  payment  of money in  excess  of
     $5,000,000 in the aggregate shall be rendered against the Borrower,  KPP or
     any Significant  Affiliate,  and either (i) enforcement  proceedings  shall
     have been  commenced  by any creditor  upon such  judgment or order or (ii)
     there  shall be a period  of 30  consecutive  days  during  which a stay of
     enforcement  of such  judgment or order,  by reason of a pending  appeal or
     otherwise, shall not be in effect; or

          (l) any  non-monetary  judgment or order shall be rendered against the
     Borrower,  KPP  or any  Significant  Affiliate  that  could  reasonably  be
     expected to have a Material Adverse Effect,  and there shall be a period of
     30 consecutive  days during which a stay of enforcement of such judgment or
     order, by reason of a pending appeal or otherwise,  shall not be in effect;
     or

          (m) a Change in Control shall occur or exist; or

          (n) any "Event of Default"  under any other Loan Document shall occur;
     or

          (o) any provision of the Subsidiary  Guarantee Agreement shall for any
     reason  cease to be valid and  binding  on,  or  enforceable  against,  any
     Guarantor,  or any Guarantor shall so state in writing, or any provision of
     Article  VIII shall for any  reason  cease to be valid and  binding  on, or
     enforceable against KPP, or KPP shall so state in writing; or any Guarantor
     shall seek to terminate its obligations under the Loan Documents;

then,  and in every such event  (other than an event with  respect to KPP or the
Borrower  described in  subsection  (g) or (h) of this  Section) and at any time
thereafter during the continuance of such event, the  Administrative  Agent may,
and upon the written  request of the Required  Lenders  shall,  by notice to the
Borrower,  take any or all of the  following  actions,  at the same or different
times:  (i) terminate the  Commitments,  whereupon the Commitment of each Lender
shall  terminate  immediately;  (ii)  declare the  principal  of and any accrued
interest  on the  Loans,  and all  other  Obligations  owing  hereunder,  to be,
whereupon   the  same  shall  become  due  and  payable   immediately,   without
presentment,  demand,  protest  or other  notice of any  kind,  all of which are
hereby  waived by the  Borrower;  (iii)  exercise all remedies  contained in any
other Loan Document, and (iv) exercise any other remedies available at law or in
equity;  and that, if an Event of Default  specified in either subsection (g) or
(h) shall occur, the Commitments shall automatically terminate and the principal
of the Loans then outstanding,  together with accrued interest thereon,  and all
fees,  and all other  Obligations  shall  automatically  become due and payable,
without presentment,  demand,  protest or other notice of any kind, all of which
are hereby waived by the Borrower.

                       Article X THE ADMINISTRATIVE AGENT


Section 10.1. Appointment of Administrative Agent.

          (a)  Each   Lender   irrevocably   appoints   SunTrust   Bank  as  the
     Administrative  Agent and  authorizes it to take such actions on its behalf
     and to exercise  such powers as are delegated to the  Administrative  Agent
     under this Agreement and the other Loan  Documents,  together with all such
     actions   and  powers  that  are   reasonably   incidental   thereto.   The
     Administrative  Agent may perform any of its duties  hereunder or under the
     other  Loan  Documents  by  or  through  any  one  or  more  sub-agents  or
     attorneys-in-fact appointed by the Administrative Agent. The Administrative
     Agent and any such sub-agent or attorney-in-fact may perform any and all of
     its duties and  exercise  its rights and powers  through  their  respective
     Related Parties. The exculpatory provisions set forth in this Article shall
     apply to any such sub-agent or attorney-in-fact  and the Related Parties of
     the Administrative  Agent, any such sub-agent and any such attorney-in-fact
     and shall  apply to their  respective  activities  in  connection  with the
     syndication  of the  credit  facilities  provided  for  herein  as  well as
     activities as Administrative Agent.

          (b) The Issuing  Bank shall act on behalf of the Lenders  with respect
     to any  Letters  of  Credit  issued  by it  and  the  documents  associated
     therewith  until  such time and  except  for so long as the  Administrative
     Agent may  agree at the  request  of the  Required  Lenders  to act for the
     Issuing Bank with respect  thereto;  provided,  that the Issuing Bank shall
     have all the benefits  and  immunities  (i) provided to the  Administrative
     Agent  in this  Article  X with  respect  to any acts  taken  or  omissions
     suffered by the Issuing Bank in connection with Letters of Credit issued by
     it or proposed to be issued by it and the  application  and  agreements for
     letters of credit  pertaining  to the  Letters of Credit as fully as if the
     term "Administrative  Agent" as used in this Article X included the Issuing
     Bank  with  respect  to such  acts or  omissions  and (ii) as  additionally
     provided in this Agreement with respect to the Issuing Bank

          (c) Each Lender hereby designates Bank One, NA, as Syndication  Agent,
     and BNP Paribas, Fleet National Bank and KeyBank National Association, each
     as Co-Documentation  Agent. Each Lender and the Loan Parties agree that the
     Syndication Agent and the  Co-Documentation  Agents shall have no duties or
     obligations  under any Loan  Documents  to the  Administrative  Agent,  any
     Lender or any Loan Party.

Section 10.2. Nature of Duties of Administrative Agent.

     The  Administrative  Agent shall not have any duties or obligations  except
those  expressly  set  forth in this  Agreement  and the other  Loan  Documents.
Without limiting the generality of the foregoing,  (i) the Administrative  Agent
shall not be subject to any  fiduciary or other  implied  duties,  regardless of
whether a Default or an Event of Default has  occurred and is  continuing,  (ii)
the  Administrative  Agent  shall  not have  any duty to take any  discretionary
action or exercise any discretionary  powers,  except those discretionary rights
and powers expressly  contemplated by the Loan Documents that the Administrative
Agent is required to exercise in writing by the Required  Lenders (or such other
number  or  percentage   of  the  Lenders  as  shall  be  necessary   under  the
circumstances  as provided in Section  11.2),  and (iii) except as expressly set
forth in the Loan Documents, the Administrative Agent shall not have any duty to
disclose,  and shall not be liable for the failure to disclose,  any information
relating to the Borrower or any of its  Subsidiaries  that is communicated to or
obtained by the  Administrative  Agent or any of its Affiliates in any capacity.
The  Administrative  Agent shall not be liable for any action taken or not taken
by it, its sub-agents or attorneys-in-fact with the consent or at the request of
the Required Lenders (or such other number or percentage of the Lenders as shall
be  necessary  under the  circumstances  as provided in Section  11.2) or in the
absence of its own gross negligence or willful  misconduct.  The  Administrative
Agent  shall  not  be  responsible  for  the  negligence  or  misconduct  of any
sub-agents or  attorneys-in-fact  selected by it. The Administrative Agent shall
not be deemed to have  knowledge  of any Default or Event of Default  unless and
until written notice thereof (which notice shall include an express reference to
such event being a "Default"  or "Event of Default"  hereunder)  is given to the
Administrative Agent by the Borrower or any Lender, and the Administrative Agent
shall not be  responsible  for or have any duty to ascertain or inquire into (A)
any statement, warranty or representation made in or in connection with any Loan
Document,  (B)  the  contents  of any  certificate,  report  or  other  document
delivered  hereunder or thereunder or in connection  herewith or therewith,  (C)
the  performance  or observance of any of the  covenants,  agreements,  or other
terms  and  conditions  set  forth  in any  Loan  Document,  (D)  the  validity,
enforceability,  effectiveness  or genuineness of any Loan Document or any other
agreement,  instrument or document, or (E) the satisfaction of any condition set
forth in Article III or  elsewhere in any Loan  Document,  other than to confirm
receipt of items expressly required to be delivered to the Administrative Agent.
The  Administrative  Agent may consult with legal counsel (including counsel for
the Borrower) concerning all matters pertaining to such duties.

Section 10.3. Lack of Reliance on the Administrative Agent.

     Each  of the  Lenders  and  the  Issuing  Bank  acknowledges  that  it has,
independently  and without reliance upon the  Administrative  Agent or any other
Lender and based on such documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement.  Each of
the Lenders and the Issuing Bank also acknowledges  that it will,  independently
and without reliance upon the Administrative Agent or any other Lender and based
on such documents and information as it has deemed appropriate, continue to make
its own  decisions  in taking or not taking of any action under or based on this
Agreement,  any  related  agreement  or  any  document  furnished  hereunder  or
thereunder.

Section 10.4. Certain Rights of the Administrative Agent.

     If the  Administrative  Agent shall request  instructions from the Required
Lenders with respect to any action or actions  (including the failure to act) in
connection with this Agreement,  the  Administrative  Agent shall be entitled to
refrain  from  such act or  taking  such act,  unless  and  until it shall  have
received  instructions from such Lenders; and the Administrative Agent shall not
incur liability to any Person by reason of so refraining.  Without  limiting the
foregoing,  no Lender  shall  have any right of action  whatsoever  against  the
Administrative  Agent  as  a  result  of  the  Administrative  Agent  acting  or
refraining  from acting  hereunder in accordance  with the  instructions  of the
Required Lenders where required by the terms of this Agreement.

Section 10.5. Reliance by Administrative Agent.

     The  Administrative  Agent shall be  entitled  to rely upon,  and shall not
incur any liability for relying upon, any notice, request, certificate, consent,
statement,  instrument,  document or other writing  believed by it to be genuine
and to have been signed,  sent or made by the proper Person.  The Administrative
Agent may also rely upon any  statement  made to it orally or by  telephone  and
believed by it to be made by the proper Person and shall not incur any liability
for relying  thereon.  The  Administrative  Agent may consult with legal counsel
(including  counsel for the Borrower),  independent public accountants and other
experts selected by it and shall not be liable for any action taken or not taken
by it in accordance with the advice of such counsel, accountants or experts.

Section 10.6. The Administrative Agent in its Individual Capacity.

     The bank serving as the Administrative Agent shall have the same rights and
powers  under this  Agreement  and any other Loan  Document in its capacity as a
Lender as any other Lender and may exercise or refrain from  exercising the same
as  though  it were  not the  Administrative  Agent;  and the  terms  "Lenders",
"Required  Lenders",  "holders of Notes", or any similar terms shall, unless the
context clearly otherwise  indicates,  include the  Administrative  Agent in its
individual  capacity.  The  bank  acting  as the  Administrative  Agent  and its
Affiliates may accept deposits from, lend money to, and generally  engage in any
kind of  business  with the  Borrower  or any  Subsidiary  or  Affiliate  of the
Borrower as if it were not the Administrative Agent hereunder.

Section 10.7. Successor Administrative Agent.

          (a) The  Administrative  Agent may resign at any time by giving notice
     thereof to the Lenders and the Borrower and may be removed at any time with
     or without  cause by the Required  Lenders.  Upon any such  resignation  or
     removal,  the Required  Lenders shall have the right to appoint a successor
     Administrative Agent, subject to the approval by the Borrower provided that
     no Default or Event of Default  shall have  occurred and be  continuing  at
     such  time.  If no  successor  Administrative  Agent  shall  have  been  so
     appointed,  and shall have accepted such  appointment  within 30 days after
     the  retiring  Administrative  Agent  gives  notice of  resignation  or the
     Required  Lenders' removal of the Agent,  then the retiring  Administrative
     Agent  may,  on behalf  of the  Lenders  and the  Issuing  Bank,  appoint a
     successor  Administrative Agent, which shall be a commercial bank organized
     under the laws of the United  States of  America or any state  thereof or a
     bank  which  maintains  an office in the United  States,  having a combined
     capital and surplus of at least $500,000,000.

          (b) Upon the acceptance of its appointment as the Administrative Agent
     hereunder  by  a  successor,  such  successor  Administrative  Agent  shall
     thereupon  succeed  to and  become  vested  with  all the  rights,  powers,
     privileges  and  duties  of the  retiring  Administrative  Agent,  and  the
     retiring  Administrative  Agent  shall be  discharged  from its  duties and
     obligations under this Agreement and the other Loan Documents. If within 45
     days after written notice is given of the retiring  Administrative  Agent's
     resignation or removal under this Section 10.7 no successor  Administrative
     Agent shall have been  appointed and shall have accepted such  appointment,
     then on such 45th day (i) the retiring  Administrative  Agent's resignation
     or removal shall become effective,  (ii) the retiring  Administrative Agent
     shall  thereupon be discharged  from its duties and  obligations  under the
     Loan Documents and (iii) the Required Lenders shall thereafter  perform all
     duties of the retiring  Administrative Agent under the Loan Documents until
     such time as the Required Lenders appoint a successor  Administrative Agent
     as provided above. After any retiring  Administrative  Agent's  resignation
     hereunder,  the  provisions of this Article X shall  continue in effect for
     the benefit of such retiring  Administrative  Agent and its representatives
     and  agents in  respect  of any  actions  taken or not taken by any of them
     while it was serving as the Administrative Agent.

Section 10.8. Authorization to Execute other Loan Documents.

     Each Lender hereby authorizes the Administrative Agent to execute on behalf
of all Lenders all Loan Documents other than this Agreement.

                            Article XI MISCELLANEOUS


Section 11.1. Notices.

          (a) Except in the case of notices and other  communications  expressly
     permitted to be given by telephone, all notices and other communications to
     any party herein to be effective shall be in writing and shall be delivered
     by hand or overnight  courier  service,  mailed by certified or  registered
     mail or sent by telecopy, as follows:

     To the Borrower:        2435 North Central Expressway
                             Suite 700
                             Richardson, Texas  75080-2731
                             Attention:  Ed Doherty
                                         Mark Jones
                             Telecopy Number:  (972) 699-1894

      To KPP:                2435 North Central Expressway
                             Suite 700
                             Richardson, Texas  75080-2731
                             Attention:  Ed Doherty
                                         Mark Jones
                             Telecopy Number:  (972) 699-1894

      To the Administrative
           Agent:            SunTrust Bank
                             303 Peachtree Street, N. E.
                             Atlanta, Georgia 30308
                             Attention: John Fields
                             Telecopy Number:

      With a copy to:        SunTrust Bank
                             Agency Services
                             303 Peachtree Street, N. E./ 25th Floor
                             Atlanta, Georgia 30308
                             Attention: Ms. Hope Williams
                             Telecopy Number: (404) 658-4906

                                   and

                             King & Spalding
                             191 Peachtree Street, N.E.
                             Atlanta, Georgia 30303
                             Attention: Carolyn Z. Alford
                             Telecopy Number: (404) 572-5100

          To the Issuing Bank: SunTrust Bank 25 Park Place, N. E./Mail Code 3706
     Atlanta,  Georgia  30303  Attention:  John Conley  Telecopy  Number:  (404)
     588-8129

      To any other Lender:   the address set forth in the Administrative
                             Questionnaire


     Any party hereto may change its address or telecopy  number for notices and
     other  communications  hereunder by notice to the other parties hereto. All
     such notices and other communications  shall, when transmitted by overnight
     delivery,  or faxed,  be effective when delivered for overnight  (next-day)
     delivery,   or   transmitted   in  legible  form  by   facsimile   machine,
     respectively,  or if  mailed,  upon the third  Business  Day after the date
     deposited  into the mails or if delivered,  upon delivery;  provided,  that
     notices delivered to the Administrative Agent or the Issuing Bank shall not
     be  effective  until  actually  received  by  such  Person  at its  address
     specified in this Section 11.1.

          (b) Any agreement of the  Administrative  Agent and the Lenders herein
     to receive  certain  notices by  telephone  or  facsimile is solely for the
     convenience and at the request of the Borrower.  The  Administrative  Agent
     and the Lenders  shall be entitled to rely on the  authority  of any Person
     purporting  to be a Person  authorized  by the Borrower to give such notice
     and the  Administrative  Agent and Lenders  shall not have any liability to
     the Borrower or other Person on account of any action taken or not taken by
     the Administrative Agent or the Lenders in reliance upon such telephonic or
     facsimile notice. The obligation of the Borrower to repay the Loans and all
     other  Obligations  hereunder  shall not be  affected  in any way or to any
     extent  by any  failure  of the  Administrative  Agent and the  Lenders  to
     receive written  confirmation of any telephonic or facsimile  notice or the
     receipt by the Administrative Agent and the Lenders of a confirmation which
     is at variance with the terms  understood by the  Administrative  Agent and
     the Lenders to be contained in any such telephonic or facsimile notice.

Section 11.2. Waiver; Amendments.

          (a) No failure or delay by the Administrative  Agent, the Issuing Bank
     or any Lender in exercising any right or power  hereunder or any other Loan
     Document,   and  no  course  of  dealing   between  the  Borrower  and  the
     Administrative  Agent or any Lender, shall operate as a waiver thereof, nor
     shall any  single or  partial  exercise  of any such  right or power or any
     abandonment  or  discontinuance  of steps to  enforce  such right or power,
     preclude any other or further exercise thereof or the exercise of any other
     right or power  hereunder  or  thereunder.  The rights and  remedies of the
     Administrative  Agent, the Issuing Bank and the Lenders hereunder and under
     the other Loan Documents are cumulative and are not exclusive of any rights
     or remedies  provided by law. No waiver of any provision of this  Agreement
     or any other Loan  Document  or consent to any  departure  by the  Borrower
     therefrom  shall  in any  event  be  effective  unless  the  same  shall be
     permitted  by  subsection  (b) of this  Section,  and then  such  waiver or
     consent  shall  be  effective  only in the  specific  instance  and for the
     purpose for which given.  Without limiting the generality of the foregoing,
     the  making of a Loan or the  issuance  of a Letter of Credit  shall not be
     construed  as a waiver of any  Default or Event of Default,  regardless  of
     whether the  Administrative  Agent, the Issuing Bank or any Lender may have
     had notice or knowledge of such Default or Event of Default at the time.

          (b) No amendment or waiver of any  provision of this  Agreement or the
     other  Loan  Documents,  nor  consent  to any  departure  by any Loan Party
     therefrom,  shall in any event be  effective  unless  the same  shall be in
     writing and signed by the Borrower and the Required Lenders or the Borrower
     and the  Administrative  Agent with the consent of the Required Lenders and
     then  such  waiver  or  consent  shall be  effective  only in the  specific
     instance and for the specific  purpose for which given;  provided,  that no
     amendment  or waiver  shall:  (i)  increase  the  Commitment  of any Lender
     without  the written  consent of such  Lender,  (ii)  reduce the  principal
     amount  of any Loan or LC  Disbursement  or  reduce  the  rate of  interest
     thereon, or reduce any fees payable hereunder,  without the written consent
     of each Lender  affected  thereby,  (iii)  postpone  the date fixed for any
     payment of any principal of, or interest on, any Loan or LC Disbursement or
     interest  thereon or any fees  hereunder  or reduce the amount of, waive or
     excuse any such payment, or postpone the scheduled date for the termination
     or reduction of any Commitment,  without the written consent of each Lender
     affected thereby, (iv) change Section 2.18(b) or (c) in a manner that would
     alter the pro rata  sharing  of  payments  required  thereby,  without  the
     written  consent of each Lender,  (v) change any of the  provisions of this
     Section or the  definition  of  "Required  Lenders" or any other  provision
     hereof specifying the number or percentage of Lenders which are required to
     waive,  amend or modify any rights  hereunder or make any  determination or
     grant any  consent  hereunder,  without the  consent of each  Lender;  (vi)
     release any  guarantor or limit the liability of any such  guarantor  under
     any guaranty agreement,  without the written consent of each Lender;  (vii)
     release all or  substantially  all  collateral (if any) securing any of the
     Obligations,  without the written consent of each Lender; provided further,
     that no such agreement shall amend,  modify or otherwise affect the rights,
     duties or  obligations  of the  Administrative  Agent or the  Issuing  Bank
     without   the  prior   written   consent  of  the   Administrative   Agent.
     Notwithstanding  the  foregoing,  any  provision of this  Agreement  may be
     amended  by an  agreement  in writing  entered  into by the  Borrower,  the
     Required Lenders and the  Administrative  Agent if (i) by the terms of such
     agreement  the  Commitment  of each Lender not  consenting to the amendment
     provided for therein shall  terminate (but such Lender shall continue to be
     entitled to the benefits of Sections  2.15,  2.16,  and 2.17 and 11.3) upon
     the  effectiveness  of such  amendment and (ii) at the time such  amendment
     becomes  effective,  each Lender not consenting thereto receives payment in
     full  principal  of and  interest  accrued  on each Loan made by it and all
     other amounts  owing to it or accrued for its account under this  Agreement
     and is released from its obligations hereunder.

     Section 11.3. Expenses; Indemnification.

          (a) The Borrower shall pay (i) all reasonable, out-of-pocket costs and
     expenses of the  Administrative  Agent and its  Affiliates,  including  the
     reasonable   fees,   charges   and   disbursements   of  counsel   for  the
     Administrative Agent and its Affiliates, in connection with the syndication
     of  the  credit  facilities   provided  for  herein,  the  preparation  and
     administration  of the Loan Documents and any amendments,  modifications or
     waivers  thereof  (whether  or not the  transactions  contemplated  in this
     Agreement  or any  other  Loan  Document  shall be  consummated),  (ii) all
     reasonable   out-of-pocket   expenses  incurred  by  the  Issuing  Bank  in
     connection with the issuance, amendment, renewal or extension of any Letter
     of Credit or any demand for payment  thereunder and (iii) all out-of-pocket
     costs and expenses  (including,  without  limitation,  the reasonable fees,
     charges and  disbursements  of outside  counsel and the  allocated  cost of
     inside counsel) incurred by the  Administrative  Agent, the Issuing Bank or
     any Lender in connection  with the  enforcement or protection of its rights
     in connection with this Agreement, including its rights under this Section,
     or in  connection  with the Loans  made or any  Letters  of  Credit  issued
     hereunder,  including all such  out-of-pocket  expenses incurred during any
     workout,  restructuring or negotiations in respect of such Loans or Letters
     of Credit.

          (b) The  Borrower  shall  indemnify  the  Administrative  Agent,  each
     Issuing  Bank  and  each  Lender,  and  each  Related  Party  of any of the
     foregoing (each, an "Indemnitee")  against,  and hold each of them harmless
     from, any and all costs, losses,  liabilities,  claims, damages and related
     expenses,  including the fees, charges and disbursements of any counsel for
     any Indemnitee, which may be incurred by or asserted against any Indemnitee
     arising out of, in  connection  with or as a result of (i) the execution or
     delivery  of  this   Agreement  or  any  other   agreement  or   instrument
     contemplated  hereby,  the  performance  by the  parties  hereto  of  their
     respective  obligations  hereunder  or  the  consummation  of  any  of  the
     transactions  contemplated hereby, (ii) any Loan or Letter of Credit or any
     actual or proposed use of the proceeds therefrom  (including any refusal by
     any Issuing Bank to honor a demand for payment  under a Letter of Credit if
     the  documents  presented  in  connection  with such demand do not strictly
     comply  with the terms of such  Letter  of  Credit),  (iii)  any  actual or
     alleged presence or release of Hazardous  Materials on or from any property
     owned by the  Borrower or any  Subsidiary  or any  Environmental  Liability
     related in any way to the Borrower or any  Subsidiary or (iv) any actual or
     prospective claim, litigation,  investigation or proceeding relating to any
     of the foregoing,  whether based on contract,  tort or any other theory and
     regardless of whether any Indemnitee is a party thereto; provided, that the
     Borrower  shall not be obligated to indemnify any Indemnitee for any of the
     foregoing arising  primarily out of such  Indemnitee's  gross negligence or
     willful misconduct as determined by a court of competent  jurisdiction in a
     final,  nonappealable  judgment.  The  foregoing  provisions  shall  be  in
     addition  to  any  right  that  Indemnitee  shall  have  at  common  law or
     otherwise.  No Indemnitee  shall be liable for any damages arising from the
     use  by  others  of  information  or  others  obtained  through   internet,
     Intralinks(R),  or other similar  transmission  services in connection with
     this Agreement.  No Indemnitee shall have any liability  (whether direct or
     indirect,  in contract or tort or  otherwise)  to the Borrower or any other
     Loan  Party  arising  out  of,  related  to  or  in  connection   with  the
     transactions contemplated by the Loan Documents,  except to the extent that
     such  liability  shall  be  finally  judicially  determined  by a court  of
     competent  jurisdiction  to have  resulted  from  such  Indemnitee's  gross
     negligence or willful  misconduct.  No Indemnitee  shall be  responsible or
     liable for special,  indirect,  consequential or punitive damages which may
     be alleged to arise in any manner in connection  with this Agreement or the
     Loan  Documents  or any  transaction  contemplated  hereby.  The  foregoing
     indemnification  and limitation on liability shall survive and continue for
     the benefit of the Indemnitees.

          (c) The Borrower shall pay, and hold the Administrative Agent and each
     of the Lenders  harmless  from and against,  any and all present and future
     stamp, documentary,  and other similar taxes with respect to this Agreement
     and any other Loan  Documents,  any collateral  described  therein,  or any
     payments due thereunder,  and save the Administrative Agent and each Lender
     harmless  from and  against  any and all  liabilities  with  respect  to or
     resulting from any delay or omission to pay such taxes.

          (d) To the extent that the Borrower  fails to pay any amount  required
     to be paid to the Administrative Agent or the Issuing Bank under subsection
     (a),  (b)  or  (c)  above,  each  Lender  severally  agrees  to  pay to the
     Administrative Agent or the Issuing Bank, as the case may be, such Lender's
     Pro Rata Share (determined as of the time that the unreimbursed  expense or
     indemnity  payment is sought) of such  unpaid  amount;  provided,  that the
     unreimbursed  expense or indemnified payment,  claim, damage,  liability or
     related  expense,  as the case may be, was incurred by or asserted  against
     the Administrative Agent or the Issuing Bank, in its capacity as such.

          (e) To the extent  permitted by applicable law, the Borrower,  KPP and
     all Significant  Affiliates shall not assert,  and hereby waives, any claim
     against any Indemnitee, on any theory of liability, for special,  indirect,
     consequential  or punitive damages (as opposed to actual or direct damages)
     arising out of, in connection with or as a result of, this Agreement or any
     agreement or instrument contemplated hereby, the transactions  contemplated
     therein, any Loan or any Letter of Credit or the use of proceeds thereof.

          (f) All amounts due under this Section shall be payable promptly after
     written demand therefor.

Section 11.4. Successors and Assigns.

          (a) The provisions of this  Agreement  shall be binding upon and inure
     to the benefit of the parties  hereto and their  respective  successors and
     assigns  permitted  hereby,  except  that the  Borrower  may not  assign or
     otherwise  transfer any of its rights or obligations  hereunder without the
     prior  written  consent of each Lender  (and any  attempted  assignment  or
     transfer by the  Borrower  without  such  consent  shall be null and void).
     Nothing in this  Agreement,  expressed  or implied,  shall be  construed to
     confer upon any Person  (other than the parties  hereto,  their  respective
     successors  and  assigns  permitted  hereby  and,  to the extent  expressly
     contemplated  hereby,  the  Related  Parties of each of the  Administrative
     Agent and the Lenders) any legal or equitable right,  remedy or claim under
     or by reason of this Agreement.

          (b) Any Lender may at any time assign to one or more  assignees all or
     a portion of its rights and obligations  under this Agreement and the other
     Loan Documents  (including all or a portion of its Commitment and the Loans
     at the time  owing to it and  including  non-pro  rata  assignments  of its
     Commitments and related Loans); provided, that (i) except in the case of an
     assignment  to a Lender or an Affiliate  of a Lender,  each of the Borrower
     and the Administrative Agent (and, in the case of an assignment of all or a
     portion of a  Commitment)  must give their  prior  written  consent  (which
     consent shall not be unreasonably withheld or delayed),  (ii) except in the
     case of an  assignment  to a  Lender  or an  Affiliate  of a  Lender  or an
     assignment  of the  entire  amount  of the  assigning  Lender's  Commitment
     hereunder  or an  assignment  while an Event of Default has occurred and is
     continuing, the amount of the Commitment of the assigning Lender subject to
     each  such  assignment  (determined  as of  the  date  the  Assignment  and
     Acceptance   with   respect  to  such   assignment   is  delivered  to  the
     Administrative  Agent)  shall  not be  less  than  $1,000,000  (unless  the
     Borrower and the Administrative Agent shall otherwise consent),  (iii) each
     partial  assignment shall be made as an assignment of a proportionate  part
     of all the assigning  Lender's rights and  obligations  with respect to any
     Commitment and the Loans related thereto under this Agreement and the other
     Loan  Documents,  (iv) the assigning  Lender and the assignee shall execute
     and  deliver to the  Administrative  Agent an  Assignment  and  Acceptance,
     together  with a processing  and  recordation  fee payable by the assigning
     Lender or the assignee (as  determined  between such  Persons) in an amount
     equal to $1,000 and (v) such assignee, if it is not a Lender, shall deliver
     a duly completed Administrative  Questionnaire to the Administrative Agent;
     provided,  that any consent of the Borrower  otherwise  required  hereunder
     shall  not  be  required  if an  Event  of  Default  has  occurred  and  is
     continuing.   Upon  the  execution  and  delivery  of  the  Assignment  and
     Acceptance  and  payment by such  assignee  to the  assigning  Lender of an
     amount  equal to the  purchase  price agreed  between  such  Persons,  such
     assignee  shall  become  a party  to this  Agreement  and  any  other  Loan
     Documents to which such  assigning  Lender is a party and, to the extent of
     such interest  assigned by such Assignment and  Acceptance,  shall have the
     rights and obligations of a Lender under this Agreement,  and the assigning
     Lender shall be released from its obligations  hereunder to a corresponding
     extent (and, in the case of an Assignment  and  Acceptance  covering all of
     the assigning  Lender's rights and obligations  under this Agreement,  such
     Lender shall cease to be a party  hereto but shall  continue to be entitled
     to the  benefits  of  Sections  2.15,  2.16  and 2.17  and  11.3.  Upon the
     consummation of any such assignment  hereunder,  the assigning Lender,  the
     Administrative  Agent and the Borrower shall make appropriate  arrangements
     to have new Notes issued if so  requested  by either or both the  assigning
     Lender or the assignee.  Any  assignment or other transfer by a Lender that
     does not  fully  comply  with the  terms of this  subsection  (b)  shall be
     treated  for  purposes  of  this  Agreement  as a sale  of a  participation
     pursuant to subsection (c) below.

          (c) Any Lender may at any time, without the consent of the Borrower or
     the Administrative  Agent or the Issuing Bank sell participations to one or
     more banks or other entities (a  "Participant") in all or a portion of such
     Lender's  rights and obligations  under this Agreement  (including all or a
     portion of its  Commitment and the Loans owing to it);  provided,  that (i)
     such Lender's obligations under this Agreement shall remain unchanged, (ii)
     such Lender shall remain solely responsible to the other parties hereto for
     the performance of its obligations  hereunder,  and (iii) the Borrower, the
     Administrative  Agent and the other Lenders  shall  continue to deal solely
     and directly with such Lender in connection  with such Lender's  rights and
     obligations  under  this  Agreement  and  the  other  Loan  Documents.  Any
     agreement  between  such Lender and the  Participant  with  respect to such
     participation  shall  provide  that such Lender shall retain the sole right
     and  responsibility  to enforce this Agreement and the other Loan Documents
     and the right to  approve  any  amendment,  modification  or waiver of this
     Agreement and the other Loan Documents;  provided,  that such participation
     agreement may provide that such Lender will not, without the consent of the
     Participant,  agree  to any  amendment,  modification  or  waiver  of  this
     Agreement  described in the first  proviso of Section  11.2(b) that affects
     the  Participant.  The  Borrower  agrees  that  each  Participant  shall be
     entitled to the benefits of Sections 2.15, 2.16 and 2.17 to the same extent
     as if it  were  a  Lender  hereunder  and  had  acquired  its  interest  by
     assignment pursuant to subsection (b); provided,  that no Participant shall
     be entitled to receive any greater  payment under Section 2.15 or 2.17 than
     the  applicable  Lender would have been entitled to receive with respect to
     the  participation  sold  to  such  Participant  unless  the  sale  of such
     participation  is made with the Borrower's  prior written  consent.  To the
     extent permitted by law, the Borrower agrees that each Participant shall be
     entitled  to the  benefits  of  Section  2.18 as  though  it were a Lender,
     provided,  that such  Participant  agrees  to share  with the  Lenders  the
     proceeds  thereof in accordance  with Section 2.18 as fully as if it were a
     Lender hereunder. A Participant that would be a Foreign Lender if it were a
     Lender  shall not be  entitled to the  benefits of Section  2.17 unless the
     Borrower is notified of such  participation  sold to such  Participant  and
     such Participant  agrees,  for the benefit of the Borrower,  to comply with
     Section 2.17(e) as though it were a Lender hereunder.

          (d) Any Lender may at any time pledge or assign a security interest in
     all or any  portion of its rights  under this  Agreement  and its Notes (if
     any) to secure its obligations to a Federal Reserve Bank without  complying
     with  this  Section;  provided,  that no such  pledge or  assignment  shall
     release a Lender from any of its  obligations  hereunder or substitute  any
     such pledgee or assignee for such Lender as a party hereto.

          (e)  Notwithstanding  anything to the contrary  contained herein,  any
     Lender (a "Granting Lender") may grant to a special purpose funding vehicle
     (an "SPV"), identified as such in writing from time to time by the Granting
     Lender to the Administrative Agent and the Borrower,  the option to provide
     to the Borrower all or any part of any Loan that such Granting Lender would
     otherwise be obligated to make to the Borrower  pursuant to this Agreement;
     provided,  that (i) nothing herein shall constitute a commitment by any SPV
     to make any Loan and (ii) if an SPV elects not to  exercise  such option or
     otherwise fails to provide all or any part of any Loan, the Granting Lender
     shall be  obligated  to make such Loan  pursuant to the terms  hereof.  The
     making of a Loan by an SPV hereunder  shall  utilize the  Commitment of the
     Granting  Lender to the same extent,  and as if such Loan were made by such
     Granting  Lender.  Each party  hereto  hereby  agrees  that no SPV shall be
     liable for any indemnity or similar payment obligation under this Agreement
     (all  liability  for which  shall  remain  with the  Granting  Lender).  In
     furtherance  of the  foregoing,  each party  hereto  hereby  agrees  (which
     agreement shall survive the termination of this Agreement)  that,  prior to
     the date  that is one year and one day  after  the  payment  in full of all
     outstanding  commercial  paper or other senior  indebtedness of any SPV, it
     will  not  institute  against,  or join any  other  Person  in  instituting
     against, such SPV any bankruptcy,  reorganization,  arrangement, insolvency
     or  liquidation  proceedings  under  the laws of the  United  States or any
     State.  Notwithstanding  anything to the contrary in this Section 11.4, any
     SPV may (i) with notice to, but without the prior  written  consent of, the
     Borrower and the Administrative Agent and without paying any processing fee
     therefor,  assign  all or a portion  of its  interests  in any Loans to the
     Granting  Lender  or to any  financial  institutions  (consented  to by the
     Borrower and the  Administrative  Agent) providing  liquidity and/or credit
     support  to or for the  account  of such  SPV to  support  the  funding  or
     maintenance  of  Loans  and  (ii)  disclose  on a  confidential  basis  any
     non-public  information  relating  to  its  Loans  to  any  rating  agency,
     commercial  paper dealer or provider of any surety,  guarantee or credit or
     liquidity  enhancement to such SPV. As this Section  11.4(e) applies to any
     particular SPV, this Section may not be amended without the written consent
     of such SPV.

Section 11.5. Governing Law; Jurisdiction; Consent to Service of Process.

          (a) This Agreement and the other Loan Documents  shall be construed in
     accordance  with and be governed by the law (without  giving  effect to the
     conflict of law principles thereof) of the State of New York.

          (b)   Each  of  the   Borrower   and  KPP   hereby   irrevocably   and
     unconditionally  submits, for itself and its property, to the non-exclusive
     jurisdiction of the United States  District Court of the Southern  District
     of New York,  and of the Supreme  Court of the State of New York sitting in
     New York County and any appellate court from any thereof,  in any action or
     proceeding  arising out of or relating to this  Agreement or any other Loan
     Document  or  the  transactions  contemplated  hereby  or  thereby,  or for
     recognition or enforcement of any judgment,  and each of the parties hereto
     hereby irrevocably and unconditionally agrees that all claims in respect of
     any such action or proceeding  may be heard and determined in such New York
     state court or, to the extent  permitted by  applicable  law,  such Federal
     court.  Each of the parties hereto agrees that a final judgment in any such
     action or  proceeding  shall be  conclusive  and may be  enforced  in other
     jurisdictions  by suit on the judgment or in any other  manner  provided by
     law.  Nothing in this Agreement or any other Loan Document shall affect any
     right that the  Administrative  Agent,  the Issuing  Bank or any Lender may
     otherwise have to bring any action or proceeding relating to this Agreement
     or any other Loan  Document  against the Borrower or its  properties in the
     courts of any jurisdiction.

          (c)  Each of the  Borrower  and KPP  irrevocably  and  unconditionally
     waives any  objection  which it may now or hereafter  have to the laying of
     venue of any such suit, action or proceeding described in subsection (b) of
     this Section and brought in any court referred to in subsection (b) of this
     Section.  Each of the parties  hereto  irrevocably  waives,  to the fullest
     extent permitted by applicable law, the defense of an inconvenient forum to
     the maintenance of such action or proceeding in any such court.

          (d) Each party to this Agreement  irrevocably  consents to the service
     of process in the manner  provided for notices in Section 11.1.  Nothing in
     this  Agreement or in any other Loan  Document will affect the right of any
     party hereto to serve process in any other manner permitted by law.

Section 11.6. WAIVER OF JURY TRIAL.

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

Section 11.7. Right of Setoff.

     In addition to any rights now or hereafter granted under applicable law and
not by way of  limitation  of any such rights,  each Lender and the Issuing Bank
shall have the right,  at any time or from time to time upon the  occurrence and
during the  continuance  of an Event of  Default,  without  prior  notice to the
Borrower,  any such notice being expressly  waived by the Borrower to the extent
permitted by applicable law, to set off and apply against all deposits  (general
or special,  time or demand,  provisional  or final) of the Borrower at any time
held or other  obligations at any time owing by such Lender and the Issuing Bank
to or for  the  credit  or the  account  of the  Borrower  against  any  and all
Obligations  held by such  Lender  or the  Issuing  Bank,  as the  case  may be,
irrespective  of whether  such Lender or the Issuing Bank shall have made demand
hereunder and although such  Obligations  may be unmatured.  Each Lender and the
Issuing Bank agree promptly to notify the Administrative  Agent and the Borrower
after any such set-off and any  application  made by such Lender and the Issuing
Bank, as the case may be;  provided,  that the failure to give such notice shall
not affect the  validity of such  set-off and  application.  Each Lender and the
Issuing Bank agrees to apply all amounts  collected from any such set-off to the
Obligations  before  applying  such amounts to any other  Indebtedness  or other
obligations  owed by the Borrower and any of its  Subsidiaries to such Lender or
Issuing Bank.

Section 11.8. Counterparts; Integration.

     This  Agreement  may be  executed  by one or  more of the  parties  to this
Agreement on any number of separate  counterparts  (including by telecopy),  and
all of said  counterparts  taken  together shall be deemed to constitute one and
the same  instrument.  This  Agreement,  the other  Loan  Documents  and the Fee
Letters  constitute  the entire  agreement  among the parties hereto and thereto
regarding  the  subject  matters  hereof and  thereof  and  supersede  all prior
agreements and understandings, oral or written, regarding such subject matters.

Section 11.9. Survival.

     All  covenants,  agreements,  representations  and  warranties  made by the
Borrower  herein  and in the  certificates  or other  instruments  delivered  in
connection  with or pursuant to this Agreement  shall be considered to have been
relied upon by the other  parties  hereto and shall  survive the  execution  and
delivery  of this  Agreement  and the  making of any Loans and  issuance  of any
Letters of Credit,  regardless of any investigation made by any such other party
or on its behalf and notwithstanding that the Administrative  Agent, the Issuing
Bank or any Lender may have had notice or  knowledge of any Default or incorrect
representation  or warranty at the time any credit is  extended  hereunder,  and
shall  continue  in full  force and  effect as long as the  principal  of or any
accrued  interest on any Loan or any fee or any other amount  payable under this
Agreement is outstanding  and unpaid or any Letter of Credit is outstanding  and
so long as the  Commitments  have not expired or  terminated.  The provisions of
Sections  2.15,  2.16,  2.17, and 11.3 and Article X shall survive and remain in
full  force  and  effect  regardless  of the  consummation  of the  transactions
contemplated  hereby,  the repayment of the Loans, the expiration or termination
of the  Letters  of  Credit  and  the  Commitments  or the  termination  of this
Agreement or any provision  hereof.  All  representations  and  warranties  made
herein, in the certificates,  reports,  notices,  and other documents  delivered
pursuant to this  Agreement  shall  survive the  execution  and delivery of this
Agreement  and the other  Loan  Documents,  and the  making of the Loans and the
issuance of the Letters of Credit.

Section 11.10. Severability.

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

Section 11.11. Confidentiality.

     Each of the  Administrative  Agent, the Issuing Bank and each Lender agrees
to take normal and reasonable precautions to maintain the confidentiality of any
information  designated in writing as confidential  and provided to it by KPP or
any Subsidiary of KPP, except that such  information may be disclosed (i) to any
Related Party of the Administrative  Agent, the Issuing Bank or any such Lender,
including without limitation accountants, legal counsel and other advisors, (ii)
to the extent  required by applicable  laws or regulations or by any subpoena or
similar legal process, (iii) to the extent requested by any regulatory agency or
authority,  (iv) to the extent that such information  becomes publicly available
other  than as a result  of a breach of this  Section  11.11,  or which  becomes
available  to the  Administrative  Agent,  the Issuing  Bank,  any Lender or any
Related Party of any of the foregoing on a  nonconfidential  basis from a source
other than KPP or any Subsidiary of KPP, (v) in connection  with the exercise of
any  remedy  hereunder  or any  suit,  action  or  proceeding  relating  to this
Agreement or the enforcement of rights hereunder, and (vi) subject to provisions
substantially  similar  to this  Section  11.11,  to any  actual or  prospective
assignee,   Participant  or  counterparty  (or  their  advisors)  to  any  swap,
securitization or derivative  transaction referenced to credit or other risks or
events arising under this  Agreement or any other Loan  Document,  or (vii) with
the consent of the Borrower. Any Person required to maintain the confidentiality
of any  information as provided for in this Section 11.11 shall be considered to
have complied with its obligation to do so if such Person has exercised the same
degree of care to  maintain  the  confidentiality  of such  information  as such
Person would accord its own confidential  information.  Notwithstanding anything
herein  to the  contrary,  any  party  to  this  Agreement  (and  any  employee,
representative,  or other agent of any party to this  Agreement) may disclose to
any and all persons,  without  limitation of any kind, the tax treatment and tax
structure of the  transactions  contemplated by this Agreement and all materials
of any kind  (including  opinions or other tax analyses) that are provided to it
relating to such tax treatment and tax structure.

Section 11.12. Interest Rate Limitation.

     Notwithstanding  anything  herein  to  the  contrary,  if at any  time  the
interest rate applicable to any Loan,  together with all fees, charges and other
amounts  which may be treated as  interest  on such Loan  under  applicable  law
(collectively,  the "Charges"), shall exceed the maximum lawful rate of interest
(the "Maximum Rate") that may be contracted  for,  charged,  taken,  received or
reserved by a Lender holding such Loan in accordance  with  applicable  law, the
rate of interest  payable in respect of such Loan  hereunder,  together with all
Charges payable in respect thereof, shall be limited to the Maximum Rate and, to
the extent  lawful,  the  interest  and Charges  that would have been payable in
respect of such Loan but were not payable as a result of the  operation  of this
Section  11.12 shall be cumulated  and the interest and Charges  payable to such
Lender in respect of other Loans or periods  shall be  increased  (but not above
the Maximum Rate therefor) until such cumulated  amount,  together with interest
thereon  at the  Federal  Funds Rate to the date of  repayment,  shall have been
received by such Lender.

Section 11.13. Waiver of Effect of Corporate Seal.

     The Borrower  represents  and  warrants  that neither it nor any other Loan
Party is required to affix its  corporate  seal to this  Agreement  or any other
Loan Document pursuant to any requirement of law or regulation, agrees that this
Agreement is delivered by Borrower  under seal and waives any  shortening of the
statute of  limitations  that may result from not affixing the corporate seal to
this Agreement or such other Loan Documents.



<PAGE>
     IN WITNESS  WHEREOF,  the parties  hereto have caused this  Agreement to be
duly  executed by their  respective  authorized  officers as of the day and year
first above written.


                                  KANEB PIPE LINE OPERATING PARTNERSHIP, L.P.

                                  By KANEB PIPE LINE COMPANY LLC,
                                     General Partner

                                      By           //s//
                                      Name:  Edward D. Doherty
                                      Title: Chairman of the Board

                                   KANEB PIPE LINE PARTNERS, L.P.

                                   By KANEB PIPE LINE COMPANY LLC,
                                     General Partner

                                      By           //s//
                                      Name:  Edward D. Doherty
                                      Title: Chairman of the Board



                                   SUNTRUST BANK,
                                   as Administrative Agent and as a Lender


                                   By        //s//
                                        John A. Fields, Jr.
                                        Managing Director