exv10w3



 






Exhibit 10.3




PREPARED BY AND WHEN

RECORDED RETURN TO:




Alon USA, LP

7616 LBJ Freeway, Suite 300

Dallas, Texas 75251

Attn: Harlin R. Dean


[TEXAS]

FORM OF


MORTGAGE AND DEED OF TRUST

(WITH SECURITY AGREEMENT AND FINANCING STATEMENT)




BY




HEP FIN-TEX/TRUST-RIVER, L.P.,

A TEXAS LIMITED PARTNERSHIP,

AS GRANTOR




TO




HARLIN R. DEAN,

AS TRUSTEE




FOR THE BENEFIT OF




ALON USA, LP,

A TEXAS LIMITED PARTNERSHIP,

AS BENEFICIARY




DATED AS OF MARCH 1, 2005



NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKE ANY
OF THE FOLLOWING INFORMATION FROM THIS INSTRUMENT BEFORE IT IS FILED FOR RECORD IN THE PUBLIC
RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER’S LICENSE NUMBER.



ATTENTION: COUNTY CLERK—THIS INSTRUMENT COVERS GOODS THAT ARE OR ARE TO BECOME FIXTURES ON THE
REAL PROPERTY DESCRIBED HEREIN AND IS TO BE FILED FOR RECORD IN THE RECORDS WHERE MORTGAGES ON REAL
ESTATE ARE RECORDED. ADDITIONALLY, THIS INSTRUMENT SHOULD BE APPROPRIATELY INDEXED, NOT ONLY AS A
MORTGAGE, BUT ALSO AS A FINANCING STATEMENT COVERING GOODS THAT ARE OR ARE TO BECOME FIXTURES ON
THE REAL PROPERTY DESCRIBED HEREIN. THE MAILING ADDRESSES OF THE GRANTOR (DEBTOR) AND BENEFICIARY
(BENEFICIARY) ARE SET FORTH IN THIS INSTRUMENT.




 









 








MORTGAGE AND DEED OF TRUST (WITH SECURITY AGREEMENT AND FINANCING STATEMENT)




     THIS MORTGAGE AND DEED OF TRUST (WITH SECURITY AGREEMENT AND FINANCING STATEMENT) (hereinafter
referred to as this “Deed of Trust”), is entered into as of the 1st day of March, 2005, by
HEP Fin-Tex/Trust-River, L.P., a Texas limited partnership (hereinafter referred to as
“Grantor”), a subsidiary of Holly Energy Partners, L.P., a Delaware limited partnership
(“HEP”), whose address for notice hereunder is at 100 Crescent Court, Suite 1600, Dallas,
Texas 75201-6927, Attention: General Counsel, facsimile number (214) 871-3523, to Harlin R. Dean,
Trustee (hereinafter referred to in such capacity as “Trustee”), whose address is 7616 LBJ
Freeway, Suite 300, Dallas, Texas 75251, for the benefit of the herein below defined Beneficiary.



W I T N E S S E T H:




ARTICLE 1




DEFINITIONS





	1.1  	Definitions. As used herein, the following terms shall have the following meanings:






(a) Affiliate: With respect to a specified Person, any other Person controlling,
controlled by or under common control with that first Person. As used in this definition,
the term “control” includes (a) with respect to any Person having voting shares or the
equivalent and elected directors, managers or Persons performing similar functions, the
ownership of or power to vote, directly or indirectly, shares or the equivalent representing
more than 50% of the power to vote in the election of directors, managers or Persons
performing similar functions, (b) ownership of more than 50% of the equity or equivalent
interest in any Person and (c) the ability to direct the business and affairs of any Person
by acting as a general partner, manager or otherwise.




(b) Beneficiary: Alon USA, LP, a Texas limited partnership, whose address for
notice hereunder is 7616 LBJ Freeway, Suite 300, Dallas, Texas 75251, Attention: General
Counsel, facsimile number (972) 367-3724.




(c) Contracts: The Terminal Contracts and/or the Pipeline Contracts, as the context
may require.




(d) Deed of Trust: Shall have the meaning set forth in the introductory paragraph
hereof.




(e) Easements: The Terminal Easements and/or the Pipeline Easements, as the context
may require.



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(f) Event of Default: Any happening or occurrence described in Article 7 of this
Deed of Trust.




(g) Fixtures: All materials, supplies, equipment, apparatus and other items now or
hereafter acquired by Grantor and now or hereafter attached to, installed in or used in
connection with (temporarily or permanently) any of the Real Property, the Pipelines or the
Terminals, together with all accessions, replacements, betterments and substitutions for any
of the foregoing and the proceeds thereof.




(h) Governmental Entity: Any court, governmental department, commission, council,
board, bureau, agency or other judicial, administrative, regulatory, legislative or other
instrumentality of the United States of America or any foreign country, or any state,
county, municipality or local governmental body or political subdivision or any such other
foreign country.




(i) Grantor: The above defined Grantor, whether one or more, and any and all
subsequent owners of the Mortgaged Property or any part thereof.




(j) Impositions: All real estate and personal property taxes; water, gas, sewer,
electricity and other utility rates and charges; charges for any easement, license or
agreement maintained for the benefit of the Mortgaged Property; and all other taxes, charges
and assessments and any interest, costs or penalties with respect thereto, general and
special, ordinary and extraordinary, foreseen and unforeseen, of any kind and nature
whatsoever which at any time prior to or after the execution hereof may be assessed, levied
or imposed upon the Mortgaged Property or the ownership, use, occupancy or enjoyment
thereof.




(k) Improvements: The Terminal Improvements and the Pipeline Improvements, as the
context may require.




(l) Leases: Any and all leases, subleases, licenses, concessions or other
agreements (written or verbal, now or hereafter in effect) which grant a possessory interest
in and to, or the right to use, the Mortgaged Property, and all other agreements, such as
utility contracts, maintenance agreements and service contracts, which in any way relate to
the use, occupancy, operation, maintenance, enjoyment or ownership of the Mortgaged
Property, including, without limitation, the Surface Leases, save and except any and all
leases, subleases or other agreements pursuant to which Grantor is granted a possessory
interest in the Real Property.




(m) Legal Requirements: Shall mean (i) any and all laws, statutes, codes, rules,
regulations, ordinances, judgments, orders, writs, decrees, requirements or determinations
of any Governmental Entity, and (ii) to the extent not covered by clause (i) immediately
above, any and all requirements of permits, licenses, certificates, authorizations,
concessions, franchises or other approvals granted by any Governmental Entity.



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(n) Mortgaged Property: The Terminal Assets and the Pipeline Assets, together
with:




	 	(i)  	all rights, privileges, tenements, hereditaments, rights-of-way, easements,
appendages and appurtenances in anywise appertaining thereto, and all right, title
and interest of Grantor in and to any streets, ways, alleys, strips or gores of land
adjoining the Real Property or any part thereof; and
	 
	 	(ii)  	all betterments, additions, alterations, appurtenances, substitutions,
replacements and revisions thereof and thereto and all reversions and remainders
therein; and
	 
	 	(iii)  	all other property and rights of Grantor of every kind and character to the
extent specifically relating to and used or to be used solely in connection with the
foregoing property, and all proceeds and products of any of the foregoing.






As used in this Deed of Trust, the term “Mortgaged Property” shall be expressly
defined as meaning all or, where the context permits or requires, any portion of the above,
and all or, where the context permits or requires, any interest therein. Notwithstanding
anything to the contrary herein, in no event shall the term “Mortgaged Property”
include any Product owned by third parties that may be shipped through or stored at or in
any of the Mortgaged Property.




(o) Obligations: Shall have the meaning given such term in Section 2.1.




(p) Permitted Encumbrances: Shall mean any of the following matters:




(a) any (i) inchoate liens, security interests or similar charges constituting
or securing the payment of expenses which were incurred incidental to the
ownership and operation of the Pipelines and Terminals (collectively, the
“Operations”) or the operation, storage, transportation, shipment,
handling, repair, construction, improvement or maintenance of the Mortgaged
Property, and (ii) materialman’s, mechanics’, repairman’s, employees’,
contractors’, operators’, warehousemen’s, barge or ship owner’s and carriers’
liens or other similar liens, security interests or charges for liquidated
amounts arising in the ordinary course of business incidental to the conduct of
the Operations or the ownership and operation of the Mortgaged Property,
securing amounts the payment of which is not delinquent and that will be paid in
the ordinary course of business or, if delinquent, that are being contested in
good faith with any action or proceeding to foreclose or attach any of the
Mortgaged Property on account thereof properly stayed; (b) any liens or security
interests for Taxes not yet delinquent or, if delinquent, that are being
contested in good faith in the ordinary course of business with any action or
proceeding to foreclose or attach any of the Mortgaged Property on account
thereof properly stayed; (c) any liens or security interests reserved in leases,
rights of way or other real property interests for rental or for compliance with
the terms of such



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leases, rights of way or other real property interests, provided payment of the
debt secured is not delinquent or, if delinquent, is being contested in good
faith in the ordinary course of business with any action or proceeding to
foreclose or attach any of the Mortgaged Property on account thereof properly
stayed; (d) all prior reservations of minerals in and under or that may be
produced from any of the lands constituting part of the Mortgaged Property or on
which any part of the Mortgaged Property is located; (e) all liens (other than
liens for borrowed money), security interests, charges, easements, restrictive
covenants, encumbrances, contracts, instruments, obligations, discrepancies,
conflicts, shortages in area or boundary lines, encroachments or protrusions, or
overlapping of improvements, defects, irregularities and other matters affecting
or encumbering title to the Mortgaged Property which individually or in the
aggregate are not such as to unreasonably or materially interfere with or
prevent any material operations conducted on the Mortgaged Property; (f) rights
reserved to or vested in any Governmental Entity to control or regulate any of
the Mortgaged Property or the Operations and all Legal Requirements of such
authorities, including any building or zoning ordinances and all environmental
laws; (g) any contract, easement, instrument, lien, security instrument, permit,
amendment, extension or other matter entered into by a party in accordance with
the terms of the Contribution Agreement (as defined in the Pipelines and
Terminals Agreement) or in compliance with the approvals or directives of the
other party made pursuant to such Contribution Agreement; (h) all Post Closing
Consents (as defined in the Contribution Agreement); (i) defects in the early
chain of the title consisting of the mere failure to recite marital status in a
document or omissions of successions of heirship proceedings, unless such
failure or omission results in another person’s superior claim of title to the
Pipeline Easements or relevant portion thereof; (j) any assertion of a defect
based on a lack of a survey with respect to the Pipelines; (k) any title defect
affecting (or the termination or expiration of) any easement, right of way,
leasehold interest or fee interest affecting property over which the Pipelines
pass which has been replaced prior to the date of this Deed of Trust by an
easement, right of way, leasehold interest or fee interest covering
substantially the same land or the portion thereof used by Beneficiary or its
affiliates; and (l) all Senior Liens.




(q) Permits: The Terminal Permits and/or the Pipeline Permits, as the context may
require.




(r) Person: An individual, a corporation, a partnership, a limited liability
company, an association, a trust, or any other entity or organization, including, without
limitation, any Governmental Entity.




(s) Personalty: The Terminal Equipment, the Pipeline Equipment, and all other
personal property (other than the Fixtures) and intangible assets of any kind or character
as defined in and subject to the provisions of the Texas Business and Commerce Code (Article
9 — Secured Transactions), which are now or hereafter located or to be located



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upon, within or about the Real Property, or which are or may be used in or related to the
planning, development, financing or operation of the Mortgaged Property, together with all
accessories, replacements and substitutions thereto or therefor and the proceeds thereof.




(t) Pipeline Assets: All of the following assets, properties and rights, whether
real, personal or mixed, which are owned or held for use by Grantor solely in connection
with the ownership or operation of those certain pipelines described in Part I of Exhibit B
(the “Pipelines”) and the maps depicted in Part II of Exhibit B:




   (i) All parcels of fee simple real property now or hereafter owned by Grantor on which
any part of the Pipelines are located including, without limitation, the property held in
fee by Grantor listed on Part III of Exhibit B (collectively, the “Pipeline Fee
Land”);




   (ii) All leases of real property now or hereafter entered into or acquired by Grantor
on which all or a part of the Pipelines are located, including, without limitation, the
leases (the “Pipeline Leases”) listed on Part IV of Exhibit B;




   (iii) All easements, rights-of-way, property use agreements, line rights and real
property licenses (including right-of-way permits from railroads and road crossing permits
or other right-of-way permits from Governmental Entities) required to operate the Pipelines
now or hereafter entered into or acquired by Grantor, including, without limitation, the
easements, rights-of-way, property use agreements, line rights and real property licenses
listed on Part V of Exhibit B (the “Pipeline Easements”);




   (iv) All structures, fixtures and appurtenances to the real property described in
clause (i) above and the leased land covered by the leases described in clause (ii) above
and now or hereafter owned by Grantor, including, without limitation, any buildings,
pipelines and pumping facilities listed on Part VI of Exhibit B (collectively, the
“Pipeline Improvements”);




   (v) To the extent same do not constitute Pipeline Improvements, any and all fittings,
cathodic protection ground beds, rectifiers, other cathodic or electric protection devices,
machinery, engines, pipes, pipelines, valves, valve boxes, connections, gates, scraper trap
extenders, telecommunication facilities and equipment (including microwave and other
transmission towers), lines, wires, computer hardware, fixed or mobile machinery and
equipment, vehicle refueling tanks, pumps, heating and non-pipeline pumping stations,
fittings, tools, furniture and metering equipment now or hereafter acquired by Grantor,
including, without limitation, (A) from time to time located on the Pipeline Real Property,
but excluding the assets of others located at such locations, or (B) wherever located, in
each case as listed on Part VII of Exhibit B (the “Pipeline Equipment”);




   (vi) The contracts, agreements, leases and other legally binding rights and obligations
of Grantor listed on Part VIII of Exhibit B, but excluding those contracts and



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agreements constituting Pipeline Leases and Pipeline Easements (the “Pipeline
Contracts”);




   (vii) The intellectual property rights and related computer software listed on Part IX
of Exhibit B;




   (viii) All permits, licenses, certificates, authorizations, registrations, orders,
waivers, variances and approvals now or hereafter granted by any Governmental Entity to
Grantor or its predecessors in interest pertaining solely to the ownership or operation of
the Pipelines, including, without limitation, those permits, licenses, certificates,
authorizations, registrations, orders, waivers, variances and approvals listed on Part X of
Exhibit B, in each case to the extent the same are assignable (the “Pipeline
Permits”); and




   (ix) All records and documents now or hereafter acquired by Grantor relating solely to
the ownership, condition or operation of the Pipeline Assets (the “Pipeline
Records”).




(u) Pipeline Contracts: Shall have the meaning set forth in subsection (vi) of the
definition of Pipeline Assets.




(v) Pipeline Easements: Shall have the meaning set forth in subsection (iii) of the
definition of Pipeline Assets.




(w) Pipeline Equipment: Shall have the meaning set forth in subsection (v) of the
definition of Pipeline Assets.




(x) Pipeline Fee Land: Shall have the meaning set forth in subsection (i) of the
definition of Pipeline Assets.




(y) Pipeline Improvements: Shall have the meaning set forth in subsection (iv) of
the definition of Pipeline Assets.




(z) Pipeline Leases: Shall have the meaning set forth in subsection (ii) of the
definition of Pipeline Assets.




(aa) Pipeline Permits: Shall have the meaning set forth in subsection (viii) of the
definition of Pipeline Assets.




(bb) Pipeline Real Property: Collectively, the Pipeline Fee Land, the Pipeline
Leases, the Pipeline Improvements and the Pipeline Easements.




(cc) Pipeline Records: Shall have the meaning set forth in subsection (ix) of the
definition of Pipeline Assets.



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(dd) Pipelines: Shall have the meaning set forth in the first paragraph of the
definition of Pipeline Assets.




(ee) Pipelines and Terminals Agreement: That certain Pipelines and Terminals
Agreement dated as of February 28, 2005 between HEP and Beneficiary, together with any
amendments, restatements or modifications from time to time made thereto.




(ff) Product: Crude oil, distilled liquid crude oil fractions, gasoline,
iso-butane, diesel fuel, and/or jet fuel transported through the Pipelines.




(gg) Real Property: The Terminal Real Property and the Pipeline Real Property.




(hh) Security Documents: This Deed of Trust and any and all other documents now or
hereafter executed by Grantor or any other Person to evidence or secure the performance of
the Obligations.




(ii) Senior Bank Liens: Collectively, (a) each lien and security interest in all or
any portion of the Mortgaged Property heretofore or hereafter granted by Grantor or its
Affiliates in favor of Union Bank of California, N.A., in its capacity as the administrative
agent (or any assignee of or successor to such administrative agent) under the Senior Credit
Agreement and on behalf of the Credit Parties (as defined in the security documents related
to such liens and security interests), and (b) each lien and security interest in all or any
portion of the Mortgaged Property hereafter granted by any Person who acquires an interest
in all or any portion of the Mortgaged Property securing senior debt of such Person.




(jj) Senior Credit Agreement: That certain Credit Agreement dated as of July 7,
2004 (as extended, amended, supplemented and/or restated, including any refinancing thereof
in whole or in part, from time to time) among Holly Energy Partners – Operating, L.P., a
Delaware limited partnership, the banks party thereto from time to time, and Union Bank of
California, N.A., in its capacity as administrative agent (or any assignee of or successor
to such administrative agent).




(kk) Senior Lien: Collectively, the Senior Bank Liens and each other lien and
security interest as to which the lien and security interest granted pursuant to this Deed
of Trust has been subordinated thereto pursuant to the terms of a Subordination,
Non-Disturbance and Attornment Agreement in substantially the form of Attachment 1 hereto
executed by the Beneficiary and the holder of such lien and security interest and recorded
in the Official Public Records of Real Property of Archer, Baylor, Clay, Culberson, Ector,
Haskell, Howard, Jones, Loving, Midland, Mitchell, Nolan, Reeves, Schackelford, Taylor,
Throckmorton, Wichita and Winkler Counties, Texas, and (at the election of such holder) any
or all of the other counties in Texas in which any of the Mortgaged Property is located.




(ll) Surface Leases: The Terminal Leases and/or the Pipeline Leases, as the context
may require.



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(mm) Taxes: Any and all federal, state, local, foreign and other net income, gross
income, gross receipts, sales, use, ad valorem, transfer, franchise, profits, license,
leases, service, service use, withholding, payroll, employment, excise, severance, stamp,
occupation, premium, property, windfall profits, customs, duties or other taxes, fees, or
assessments.




(nn) Terminal Assets: All of the following assets, properties and rights, whether
real, personal or mixed, which are owned or held for use by Grantor solely in connection
with the ownership or operation of those certain terminals described in Part I of Exhibit A
(the “Terminals”):




   (i) All parcels of fee simple real property now or hereafter owned by Grantor on which
any part of the Terminals is located including, without limitation, the property listed on
Part II of Exhibit A (collectively, the “Terminal Fee Land”);




   (ii) All leases of real property now or hereafter entered into or acquired by Grantor
on which all or a part of the Terminals is located, including, without limitation, the
leases (the “Terminal Leases”) listed on Part III of Exhibit A;




   (iii) All easements, rights-of-way, property use agreements, line rights and real
property licenses (including right-of-way permits from railroads and road crossing permits
or other right-of-way permits from Governmental Entities) required to operate the Terminals
now or hereafter entered into or acquired by Grantor, including, without limitation, the
easements, rights-of-way, property use agreements, line rights and real property licenses
listed on Part IV of Exhibit A (the “Terminal Easements”);




   (iv) All structures, fixtures and appurtenances to the real property described in
clause (i) above and the leased land covered by the leases described in clause (ii) above
and now or hereafter owned by Grantor, including, without limitation, any buildings,
pipelines and pumping facilities, listed on Part V of Exhibit A (collectively, the
“Terminal Improvements”);




   (v) To the extent same do not constitute Terminal Improvements, any and all fittings,
cathodic protection ground beds, rectifiers, other cathodic or electric protection devices,
machinery, engines, pipes, pipelines, valves, valve boxes, connections, gates, scraper trap
extenders, telecommunication facilities and equipment (including microwave and other
transmission towers), lines, wires, computer hardware, fixed or mobile machinery and
equipment, vehicle refueling tanks, pumps, heating and non-pipeline pumping stations,
fittings, tools, furniture and metering equipment, now or hereafter acquired by Grantor,
including, without limitation, (A) from time to time located on the Terminal Real Property,
but excluding the assets of others located at such locations, or (B) wherever located, in
each case as listed on Part VI of Exhibit A (the “Terminal Equipment”);




   (vi) The contracts, agreements, leases and other legally binding rights and obligations
of Grantor listed on Part VII of Exhibit A, but excluding those contracts and



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agreements constituting Terminal Leases and Terminal Easements (the “Terminal
Contracts”);




   (vii) The intellectual property rights and related computer software listed on Part
VIII of Exhibit A;




   (viii) All permits, licenses, certificates, authorizations, registrations, orders,
waivers, variances and approvals now or hereafter granted by any Governmental Entity to
Grantor or its predecessors in interest pertaining solely to the ownership or operation of
the Terminals, including, without limitation, those permits, licenses, certificates,
authorizations, registrations, orders, waivers, variances and approvals listed on Part IX of
Exhibit A, in each case to the extent the same are assignable (the “Terminal
Permits”); and




   (ix) All records and documents now or hereafter acquired by Grantor relating solely to
the ownership, condition or operation of the Terminal Assets (the “Terminal
Records”).




(oo) Terminal Contracts: Shall have the meaning set forth in subsection (vi) of the
definition of Terminal Assets.




(pp) Terminal Easements: Shall have the meaning set forth in subsection (iii) of
the definition of Terminal Assets.




(qq) Terminal Equipment: Shall have the meaning set forth in subsection (v) of the
definition of Terminal Assets.




(rr) Terminal Fee Land: Shall have the meaning set forth in subsection (i) of the
definition of Terminal Assets.




(ss) Terminal Improvements: Shall have the meaning set forth in subsection (iv) of
the definition of Terminal Assets.




(tt) Terminal Leases: Shall have the meaning set forth in subsection (ii) of the
definition of Terminal Assets.




(uu) Terminal Permits: Shall have the meaning set forth in subsection (viii) of the
definition of Terminal Assets.




(vv) Terminal Real Property: Collectively, the Terminal Fee Land, the Terminal
Leases, the Terminal Improvements and the Terminal Easements.




(ww) Terminal Records: Shall have the meaning set forth in subsection (ix) of the
definition of Terminal Assets.



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(xx) Terminals: Shall have the meaning set forth in the first paragraph of the
definition of Terminal Assets.



ARTICLE 2




GRANT




2.1 Grant. To secure and enforce the prompt performance and compliance by HEP of all
obligations set forth for HEP in Section 13(c), Section 17(c), Section 17(d), Section 18 and
Section 21(c) of the Pipelines and Terminals Agreement, plus all damages owed to Beneficiary
resulting from any rejection of the Pipelines and Terminals Agreement by HEP in any bankruptcy or
insolvency proceeding involving HEP, and any reasonable costs and expenses (including, but not
limited to, attorneys’ and experts’ fees and court costs) incurred by Beneficiary in enforcing and
exercising its rights hereunder (collectively, the “Obligations”), Grantor has GRANTED,
BARGAINED, SOLD and CONVEYED, and by these presents does GRANT, BARGAIN, SELL and CONVEY, unto
Trustee the Mortgaged Property, subject, however, to the Permitted Encumbrances, TO HAVE
AND TO HOLD the Mortgaged Property unto Trustee, forever, and Grantor does hereby bind itself, its
successors and assigns to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property unto
Trustee against every Person whomsoever lawfully claiming or to claim the same or any part thereof
other than against any holder of any Senior Lien; provided, however, that this grant shall
terminate upon the full performance and discharge of all of the Obligations and in accordance with
the other terms set forth herein.



ARTICLE 3




WARRANTIES AND REPRESENTATIONS




     Grantor hereby unconditionally warrants and represents to Beneficiary as follows:



3.1 Organization and Power. Grantor (a) is a limited partnership duly organized, validly
existing and in good standing under the laws of the State of Texas, and has complied with all
conditions prerequisite to its doing business in the State of Texas and (b) has all requisite power
and all governmental certificates of authority, licenses, permits, qualifications and documentation
to own, lease and operate its properties and to carry on its business as now being, and as proposed
to be, conducted.



3.2 Validity of Security Documents. The execution, delivery and performance by Grantor of
the Security Documents (a) are within Grantor’s powers and have been duly authorized by Grantor’s
partners or other necessary parties, and all other requisite action for such authorization has been
taken; (b) have received all (if any) requisite prior governmental approval in order to be legally
binding and enforceable in accordance with the terms thereof; and (c) will not violate, be in
conflict with, result in a breach of or constitute (with due notice or lapse of time, or both) a
default under, any Legal Requirement or result in the creation or imposition of any lien, charge



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or encumbrance of any nature whatsoever upon any of Grantor’s property or assets, except as
contemplated by the provisions of the Security Documents. The Security Documents constitute the
legal, valid and binding obligations of Grantor and others obligated under the terms of the
Security Documents, in accordance with their respective terms.



3.3 Lien of this Instrument. Subject to the Senior Liens, this Deed of Trust constitutes a
valid and subsisting deed of trust lien on the Real Property and the Fixtures and a valid,
subsisting security interest in and to, and a valid assignment of, the Personalty and Leases, all
in accordance with the terms hereof.



3.4 Litigation. There are no actions, suits or proceedings pending, or to the knowledge of
Grantor threatened, against or affecting the Grantor as a result of or in connection with Grantor’s
entering into this Deed of Trust, or involving the validity or enforceability of this Deed of Trust
or the priority of the liens and security interests created by the Security Documents, and no event
has occurred (including specifically Grantor’s execution of the Security Documents) which will
violate, be in conflict with, result in the breach of, or constitute (with due notice or lapse of
time, or both) a default under, any Legal Requirement or result in the creation or imposition of
any lien, charge or encumbrance of any nature whatsoever upon any of Grantor’s property other than
the liens and security interests created by the Security Documents.



ARTICLE 4




AFFIRMATIVE COVENANTS OF GRANTOR




     Grantor hereby unconditionally covenants and agrees with Beneficiary as follows:



4.1 Lien Status. Except for the Permitted Encumbrances, Grantor will protect the lien and
security interest status of this Deed of Trust and except for the Permitted Encumbrances, will not,
without the prior written consent of Beneficiary, place, or permit to be placed, or otherwise
mortgage, hypothecate or encumber the Mortgaged Property with, any other lien or security interest
of any nature whatsoever (statutory, constitutional or contractual) regardless of whether same is
allegedly or expressly inferior to the lien and security interest created by this Deed of Trust,
and, if any such lien or security interest is asserted against the Mortgaged Property, Grantor will
promptly, at its own cost and expense, (a) pay the underlying claim in full or take such other
action so as to cause same to be released and (b) within five days from the date such lien or
security interest is so asserted, give Beneficiary notice of such lien or security interest. Such
notice shall specify who is asserting such lien or security interest and shall detail the origin
and nature of the underlying claim giving rise to such asserted lien or security interest.



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ARTICLE 5




NEGATIVE COVENANTS OF GRANTOR




          Grantor hereby covenants and agrees with Beneficiary that, until the full performance and
discharge of all of the Obligations, Grantor will not, without the prior written consent of
Beneficiary, create, place or permit to be created or placed, or through any act or failure to act,
acquiesce in the placing of, or allow to remain, any mortgage, pledge, lien (statutory,
constitutional or contractual), security interest, encumbrance or charge on, or conditional sale or
other title retention agreement, regardless of whether same are expressly subordinate to the liens
of the Security Documents, with respect to, the Mortgaged Property, other than the Permitted
Encumbrances.



ARTICLE 6




AFFIRMATIVE COVENANTS OF BENEFICIARY




          By its acceptance hereof, Beneficiary recognizes that (a) Grantor is obligated or may
hereafter become obligated to any of the Credit Parties in connection with the Senior Credit
Agreement, and (b) Grantor and any future owner of the Mortgaged Property may incur additional
indebtedness or become otherwise obligated to one or more banks, insurance companies, investment
banks or other financial institutions regularly engaged in commercial lending and/or bonds,
debentures, notes and similar instruments evidencing obligations that may be secured by liens or
security interests on some or all of Grantor’s property, including the Mortgaged Property (the
holder of such liens or security interests being a “Secured Lender”). To the extent that
any such Secured Lender notifies Beneficiary of Secured Lender’s desire to subordinate the lien and
security interest held by Beneficiary pursuant to this Deed of Trust, Beneficiary, by its
acceptance hereof, will agree to effect such subordination by promptly executing, in one or more
counterparts, a Subordination, Non-Disturbance and Attornment Agreement in substantially the form
of Attachment 1 hereto (the “SNDA”). The subordination of this Deed of Trust shall (i) not
be effective unless and until the SNDA has been executed by the Secured Lender, and (ii) be subject
to compliance by the Secured Lender with its obligations under Section 3 and Section 4 of the SNDA.
Any Secured Lender who is a party to an SNDA and who is in compliance with its obligations under
Section 3 and Section 4 of such SNDA is hereinafter referred to as a “Lienholder.”



ARTICLE 7




EVENTS OF DEFAULT




          The term “Event of Default”, as used in the Security Documents, shall mean the
occurrence or happening, at any time and from time to time, of any one or more of the following.



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7.1 Breach of Deed of Trust. (a) Grantor shall (i) fail to perform or observe, in any
material respect, any covenant, condition or agreement of this Deed of Trust to be performed or
observed by Grantor, or (ii) breach any warranty or representation made by Grantor in this Deed of
Trust, and such failure or breach shall continue unremedied for a period of thirty (30) days after
receipt of written notice thereof to the Grantor from the Beneficiary; provided, however, that in
the event such failure or breach cannot be reasonably cured within such thirty (30) day period and
Grantor has diligently proceeded (and continues to proceed) to cure such breach, Grantor shall have
an additional sixty (60) days to cure such failure or breach, or (b) HEP shall fail to perform all
of the Obligations in full and on or before the dates same are to be performed (after giving effect
to any applicable grace and cure periods).



7.2 Voluntary Bankruptcy. Grantor shall (i) voluntarily be adjudicated a bankrupt or
insolvent, (ii) procure, permit or suffer the voluntary or involuntary appointment of a receiver,
trustee or liquidator for itself or for all or any substantial portion of its property, (iii) file
any petition seeking a discharge, rearrangement, or reorganization of its debts pursuant to the
bankruptcy laws or any other debtor relief laws of the United States or any state or any other
competent jurisdiction, or (iv) make a general assignment for the benefit of its creditors.



7.3 Involuntary Bankruptcy. If (i) a petition is filed against Grantor seeking to
rearrange, reorganize or extinguish its debts under the provisions of any bankruptcy or other
debtor relief law of the United States or any state or other competent jurisdiction, and such
petition is not dismissed or withdrawn within sixty (60) days after its filing, or (ii) a court of
competent jurisdiction enters an order, judgment or decree appointing, without the consent of
Grantor a receiver or trustee for it, or for all or any part of its property, and such order,
judgment, or decree is not dismissed, withdrawn or reversed within sixty (60) days after the date
of entry of such order, judgment or decree.



7.4 Rejection of Pipelines and Terminals Agreement. A rejection, by or on behalf of
Grantor or HEP, of the Pipelines and Terminals Agreement in bankruptcy.




ARTICLE 8




DEFAULT



8.1 Remedies. Subject, in each case, to the rights of any Lienholder arising under or
pursuant to the Senior Liens, and the terms and provisions of the SNDA, and provided no Alon Event
of Default (as defined in the Pipelines and Terminals Agreement) has occurred and is continuing
(other than an Alon Event of Default resulting solely and directly from a failure by HEP to comply
with the Obligations), if an Event of Default shall occur and be continuing, Beneficiary may, at
Beneficiary’s election and by or through Trustee or otherwise, exercise any or all of the following
rights, remedies and recourses.





(a) Entry Upon Mortgaged Property. Enter upon the Mortgaged Property and take
exclusive possession thereof and of all books, records and accounts relating thereto. If
Grantor remains in possession of all or any part of the Mortgaged Property after an Event



13









 






of Default and without Beneficiary’s prior written consent thereto, Beneficiary may invoke
any and all legal remedies (other than foreclosure) to dispossess Grantor, including
specifically one or more actions for forcible entry and detainer, trespass to try title and
writ of restitution. Nothing contained in the foregoing sentence shall, however, be
construed to impose any greater obligation or any prerequisites to acquiring possession of
the Mortgaged Property after an Event of Default than would have existed in the absence of
such sentence.




(b) Operation of Mortgaged Property. Hold, lease, manage, operate or otherwise use
or permit the use of the Mortgaged Property, either itself or by other Persons, firms or
entities, in such manner, for such time and upon such other terms as Beneficiary may deem to
be prudent and reasonable under the circumstances (making such repairs, alterations,
additions and improvements thereto and taking any and all other action with reference
thereto, from time to time, as Beneficiary shall deem necessary or desirable), and apply all
amounts collected by Trustee or Beneficiary in connection therewith in accordance with the
provisions of Section 8.7.




(c) Trustee or Receiver. Prior to, upon or at any time after, commencement of any
legal proceedings hereunder, make application to a court of competent jurisdiction as a
matter of strict right and without notice to Grantor or regard to the adequacy of the
Mortgaged Property for the satisfaction of the Obligations for appointment of a receiver of
the Mortgaged Property, and Grantor does hereby irrevocably consent to such appointment.
Any such receiver shall have all the usual powers and duties of receivers in similar cases,
including the full power to rent, maintain and otherwise operate the Mortgaged Property upon
such terms as may be approved by the court.




(d) Other. Exercise any and all other rights, remedies and recourses granted under
this Deed of Trust.


8.2 Remedies Cumulative, Concurrent and Nonexclusive. Beneficiary shall have all rights,
remedies and recourses granted in the Pipelines and Terminals Agreement and, subject to the rights
of any Lienholder arising under or pursuant to the Senior Liens, and the terms and provisions of
the SNDA, the Deed of Trust and same (a) shall be cumulative and concurrent; (b) may be pursued
separately, successively or concurrently against Grantor or others obligated under this Deed of
Trust, or against the Mortgaged Property, or against any one or more of them, at the sole
discretion of Beneficiary; (c) may be exercised as often as occasion therefor shall arise, it being
agreed by Grantor that the exercise or failure to exercise any of same shall in no event be
construed as a waiver or release thereof or of any other right, remedy or recourse; and (d) are
intended to be, and shall be, nonexclusive.



8.3 Obligations. Neither Grantor, HEP nor any other Person hereafter obligated for
performance or fulfillment of all or any of the Obligations shall be relieved of such obligation by
reason of (a) the failure of Trustee to comply with any request of Grantor or any other Person to
enforce any provisions of this Deed of Trust; (b) the release, regardless of consideration, of the
Mortgaged Property or the addition of any other property to the Mortgaged Property; (c) any
agreement or stipulation between any subsequent owner of the Mortgaged Property and




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Beneficiary extending, renewing, rearranging or in any other way modifying the terms of the
Security Documents without first having obtained the consent of, given notice to or paid any
consideration to Grantor or such other Person, and in such event Grantor and all such other Persons
shall continue to be liable to make payment according to the terms of any such extension or
modification agreement unless expressly released and discharged in writing by Beneficiary; or (d)
by any other act or occurrence save and except the complete fulfillment of all of the Obligations.



8.4 Release of and Resort to Collateral. Beneficiary may release, regardless of
consideration, any part of the Mortgaged Property without, as to the remainder, in any way
impairing, affecting, subordinating or releasing the lien or security interest created in or
evidenced by this Deed of Trust or their stature as a lien and security interest in and to the
Mortgaged Property.



8.5 Waiver of Redemption, Notice and Marshalling of Assets. To the fullest extent
permitted by law, Grantor hereby irrevocably and unconditionally waives and releases (a) all
benefits that might accrue to Grantor by virtue of any present or future law exempting the
Mortgaged Property from attachment, levy or sale on execution or providing for any appraisement,
valuation, stay of execution, exemption from civil process, redemption or extension of time for
payment; (b) all notices of any Event of Default or of Trustee’s election to exercise or his actual
exercise of any right, remedy or recourse provided for under this Deed of Trust; and (c) any right
to a marshalling of assets or a sale in inverse order of alienation.



8.6 Discontinuance of Proceedings. In case Beneficiary shall have proceeded to invoke any
right, remedy or recourse permitted under this Deed of Trust and shall thereafter elect to
discontinue or abandon same for any reason, Beneficiary shall have the unqualified right so to do
and, in such an event, Grantor and Beneficiary shall be restored to their former positions with
respect to the Obligations, the Security Documents, the Mortgaged Property and otherwise, and the
rights, remedies, recourses and powers of Beneficiary shall continue as if same had never been
invoked.



8.7 Application of Proceeds. Subject, in each case, to the rights of any Lienholder
arising under or pursuant to the Senior Liens, and the terms and provisions of the SNDA (including,
without limitation, the right to receive payments otherwise due to HEP under the terms of the
Pipelines and Terminals Agreement), the proceeds and other amounts generated by the holding,
operating or other use of, the Mortgaged Property shall be applied by Trustee or Beneficiary (or
the receiver, if one is appointed) to the extent that funds are so available therefrom in the
following orders of priority:





(a) first, to the payment of the costs and expenses of taking possession of the Mortgaged
Property and of holding, using, leasing, repairing and improving the same, including without
limitation (i) trustees’ and receivers’ fees, (ii) court costs, (iii) attorneys’ and
accountants’ fees, and (iv) the payment of any and all Impositions, liens, security
interests or other rights, titles or interests equal or superior to the lien and security
interest of this Deed of Trust (except those to which the Mortgaged Property has



15









 






been sold subject to and without in any way implying Beneficiary’s prior consent to the
creation thereof);




(b) second, to the payment of all amounts which may be due to Beneficiary with respect to
the Obligations;




(c) third, to the extent permitted by law, funds are available therefor out of the proceeds
generated by the holding, operating or other use of the Mortgaged Property and known by
Beneficiary, to the payment of any indebtedness or obligation secured by a subordinate deed
of trust on or security interest in the Mortgaged Property; and




(d) fourth, to Grantor.


8.8 INDEMNITY. IN CONNECTION WITH ANY ACTION TAKEN BY TRUSTEE AND/OR BENEFICIARY PURSUANT
TO THIS MORTGAGE, TRUSTEE AND/OR BENEFICIARY AND THEIR RESPECTIVE OFFICERS, DIRECTORS,
SHAREHOLDERS, PARTNERS, MEMBERS, EMPLOYEES, AGENTS, REPRESENTATIVES, ATTORNEYS, ACCOUNTANTS AND
EXPERTS (COLLECTIVELY THE “INDEMNIFIED PARTIES”) SHALL NOT BE LIABLE FOR ANY LOSS SUSTAINED BY
GRANTOR RESULTING FROM (i) AN ASSERTION THAT TRUSTEE, BENEFICIARY OR INDEMNIFIED PARTY HAS RECEIVED
FUNDS FROM THE OPERATIONS OF THE MORTGAGED PROPERTY CLAIMED BY THIRD PERSONS OR (ii) ANY ACT OR
OMISSION OF TRUSTEE, BENEFICIARY OR INDEMNIFIED PARTY IN ADMINISTERING, MANAGING, OPERATING OR
CONTROLLING THE MORTGAGED PROPERTY, INCLUDING IN EITHER CASE SUCH LOSS WHICH MAY RESULT FROM THE
ORDINARY NEGLIGENCE OF TRUSTEE, BENEFICIARY OR AN INDEMNIFIED PARTY OR WHICH MAY RESULT FROM STRICT
LIABILITY, WHETHER UNDER APPLICABLE LAW OR OTHERWISE, UNLESS SUCH LOSS IS CAUSED BY THE GROSS
NEGLIGENCE, WILLFUL MISCONDUCT OR BAD FAITH OF TRUSTEE, BENEFICIARY OR ANY INDEMNIFIED PARTY NOR
SHALL TRUSTEE, BENEFICIARY AND/OR ANY INDEMNIFIED PARTY BE OBLIGATED TO PERFORM OR DISCHARGE ANY
OBLIGATION, DUTY OR LIABILITY OF GRANTOR. GRANTOR SHALL AND DOES HEREBY AGREE TO INDEMNIFY
TRUSTEE, BENEFICIARY AND EACH OF THEIR RESPECTIVE INDEMNIFIED PARTIES FOR, AND TO HOLD THEM
HARMLESS FROM, ANY AND ALL LOSSES WHICH MAY OR MIGHT BE INCURRED BY TRUSTEE, BENEFICIARY OR
INDEMNIFIED PARTY BY REASON OF THIS DEED OF TRUST OR THE EXERCISE OF RIGHTS OR REMEDIES HEREUNDER,
INCLUDING SUCH LOSSES WHICH MAY RESULT FROM THE ORDINARY NEGLIGENCE OF TRUSTEE, BENEFICIARY OR AN
INDEMNIFIED PARTY OR WHICH MAY RESULT FROM STRICT LIABILITY, WHETHER UNDER APPLICABLE LAW OR
OTHERWISE, UNLESS SUCH LOSS IS CAUSED BY THE GROSS NEGLIGENCE, WILLFUL MISCONDUCT OR BAD FAITH OF
TRUSTEE, BENEFICIARY OR INDEMNIFIED PARTY. SHOULD TRUSTEE, BENEFICIARY AND/OR ANY INDEMNIFIED
PARTY MAKE ANY EXPENDITURE ON ACCOUNT OF ANY SUCH LOSSES, THE AMOUNT THEREOF, INCLUDING, WITHOUT




16









 







LIMITATION, COSTS, EXPENSES AND REASONABLE ATTORNEYS’ FEES, SHALL BE A DEMAND OBLIGATION (WHICH
OBLIGATION GRANTOR HEREBY EXPRESSLY PROMISES TO PAY) OWING BY GRANTOR TO TRUSTEE AND/OR BENEFICIARY
AND SHALL BEAR INTEREST FROM THE DATE EXPENDED UNTIL PAID AT THE HIGHEST RATE ALLOWED BY LAW, SHALL
BE A PART OF THE OBLIGATIONS AND SHALL BE SECURED BY THIS DEED OF TRUST. THE LIABILITIES OF
GRANTOR AS SET FORTH IN THIS SECTION 8.8 SHALL SURVIVE THE TERMINATION OF THIS DEED OF TRUST.




ARTICLE 9




SECURITY AGREEMENT



9.1 Security Interest. This Deed of Trust shall be construed as a deed of trust on real

property and it shall (subject to the Senior Liens) also constitute and serve as a “Security
Agreement” on personal property within the meaning of, and shall constitute a security interest
under, the Uniform Commercial Code (being Chapter 9 of the Texas Business and Commerce Code, as to
property within the scope thereof and situated in the State of Texas) with respect to the
Personalty, Fixtures and Leases. To this end, Grantor has GRANTED, BARGAINED, CONVEYED, ASSIGNED,
TRANSFERRED, AND SET OVER, and by these presents does GRANT, BARGAIN, CONVEY, ASSIGN, TRANSFER AND
SET OVER, unto Trustee and unto Beneficiary, a security interest and all of Grantor’s right, title
and interest in, to and under the Personalty, Fixtures and Leases to secure the full and timely
performance and discharge of the Obligations, subject only to the Permitted Encumbrances.



9.2 Financing Statements. Grantor hereby authorizes Beneficiary to file such “Financing
Statements,” and Grantor hereby agrees to execute and deliver such further assurances as
Beneficiary may, from time to time, consider reasonably necessary to create, perfect and preserve
Beneficiary’s security interest herein granted and Beneficiary may cause such statements and
assurances to be recorded and filed, at such times and places as may be required or permitted by
law to so create, perfect and preserve such security interest.



9.3 Uniform Commercial Code Remedies. Subject, in each case, to the rights of any
Lienholder under or pursuant to the Senior Liens, and the terms and provisions of the SNDA and this
Deed of Trust, Beneficiary and/or Trustee shall have all the rights, remedies and recourses (other
than auction and sale rights) with respect to the Personalty, Fixtures and Leases afforded to it by
the aforesaid Uniform Commercial Code (being Chapter 9 of the Texas Business and Commerce Code, as
to property within the scope thereof and situated in the State of Texas) in addition to, and not in
limitation of, the other rights, remedies and recourses afforded by this Deed of Trust.



9.4 No Obligation of Trustee or Beneficiary. The assignment and security interest herein
granted shall not be deemed or construed to constitute Trustee or Beneficiary as a trustee in
possession of the Mortgaged Property, to obligate Trustee or Beneficiary to lease the Mortgaged
Property or attempt to do same, or to take any action, incur any expense or perform or discharge
any obligation, duty or liability whatsoever.




17









 







9.5 Fixture Filing. This Deed of Trust shall constitute a “fixture filing” for all
purposes of Chapter 9 of the Texas Business and Commerce Code. All or part of the Mortgaged
Property are or are to become fixtures; information concerning the security interest herein granted
may be obtained at the addresses set forth on the first page hereof. The address of the Secured
Party (Beneficiary) is the address set forth in Section 1.1(a) and the address of the Debtor
(Grantor) is the address set forth in the opening recital of this Deed of Trust.



9.6 Satisfaction and Release. If (a) all Obligations secured hereby shall be paid,
performed and satisfied in full, (b) the Mortgaged Property (or any portion thereof, in which case
the provisions of clauses (i) through (iv) below shall be applicable only to such portion) shall be
sold, consigned, conveyed or transferred in accordance with the provisions of the Pipelines and
Terminals Agreement, (c) the Pipelines and Terminals Agreement shall be terminated, cancelled or
otherwise expire (except to the extent terminated by Beneficiary pursuant to a Force Majeure event
affecting Grantor or an HEP Event of Default (each as defined in such agreement) and in accordance
with Section 10(b) or Section 17(b) of the Pipelines and Terminals Agreement, as applicable), and
the Obligations of HEP set forth in Section 13(c) of the Pipelines and Terminals Agreement shall no
longer be applicable, and/or (d) at any time Grantor’s or HEP’s (in the event Grantor does not have
a stand-alone credit rating) senior unsecured debt has an Investment Grade Rating (as hereinafter
defined) from both Moody’s Investors Service, Inc. (“Moody’s”) and Standard & Poor’s
Ratings Group (“S&P”) (or any successor to the rating business of either thereof), then (i)
this Deed of Trust shall be null and void, (ii) the liens and security interests created by this
Deed of Trust shall be released as promptly as practicable, (iii) the Mortgaged Property shall
revert to Grantor (or the transferee in the case of clause (b) above) free and clear of the liens
and security interests created by this Deed of Trust, and (iv) Beneficiary and Trustee (as
applicable) shall execute and deliver, or cause to be executed and delivered, instruments of
satisfaction and release that are reasonably requested by Grantor. Otherwise, this Deed of Trust
shall remain and continue in full force and effect. As used in this Section 9.6, the term
“Investment Grade Rating” shall mean a rating equal to or higher than Baa3 (or the equivalent) by
Moody’s, or BBB- (or the equivalent) by S&P.




ARTICLE 10




CONCERNING THE TRUSTEE



10.1 No Required Action. Trustee shall not be required to take any action toward the
execution and enforcement of the trust hereby created or to institute, appear in or defend any
action, suit or other proceeding in connection therewith where in his opinion such action will be
likely to involve him in expense or liability, unless requested so to do by a written instrument
signed by Beneficiary and, if Trustee so requests, unless Trustee is tendered security and
indemnity satisfactory to him against any and all costs, expense and liabilities arising therefrom.
Trustee shall not be responsible for the execution, acknowledgment or validity of the Security
Documents, or for the proper authorization thereof, or for the sufficiency of the lien and security
interest purported to be created hereby, and makes no representation in respect thereof or in
respect of the rights, remedies and recourses of Beneficiary.




18









 







10.2 Certain Rights. With the approval of Beneficiary, Trustee shall have the right to
take any and all of the following actions: (a) to select, employ and advise with counsel (who may
be, but need not be, counsel for Beneficiary) upon any matters arising hereunder, including the
preparation, execution and interpretation of the Security Documents, and shall be fully protected
in relying as to legal matters on the advice of counsel; (b) to execute any of the trusts and
powers hereof and to perform any duty hereunder either directly or through his agents or attorneys;
(c) to select and employ, in and about the execution of his duties hereunder, suitable accountants,
engineers and other experts, agents and attorneys-in-fact, either corporate or individual, not
regularly in the employ of Trustee, and Trustee shall not be answerable for any act, default or
misconduct of any such accountant, engineer or other expert, agent or attorney-in-fact, if selected
with reasonable care, or for any error of judgment or act done by Trustee in good faith, or be
otherwise responsible or accountable under any circumstances whatsoever, except for Trustee’s gross
negligence or bad faith; and (d) to take any and all other lawful action as Beneficiary may
instruct Trustee to take to protect or enforce Beneficiary’s rights hereunder. Trustee shall not
be personally liable in case of entry by him, or anyone entering by virtue of the powers herein
granted him, upon the Mortgaged Property for debts contracted or liability or damages incurred in
the management or operation of the Mortgaged Property. Trustee shall have the right to rely on any
instrument, document or signature authorizing or supporting any action taken or proposed to be
taken by him hereunder, believed by him in good faith to be genuine. Trustee shall be entitled to
reimbursement for expenses incurred by him in the performance of his duties hereunder and to
reasonable compensation for such of his services hereunder as shall be rendered. Grantor will,
from time to time, pay the compensation due to Trustee hereunder and reimburse Trustee for, and
save him harmless against, any and all liability and expenses which may be incurred by him in the
performance of his duties.



10.3 Retention of Moneys. All moneys received by Trustee shall, until used or applied as
herein provided, be held in trust for the purposes for which they were received, but need not be
segregated in any manner from any other moneys (except to the extent required by law) and Trustee
shall be under no liability for interest on any moneys received by him hereunder.



10.4 Successor Trustees. Trustee may resign by the giving of notice of such resignation in
writing to Beneficiary. If Trustee shall die, resign or become disqualified from acting in the
execution of this trust, or shall fail or refuse to execute the same when requested by Beneficiary
so to do, or if, for any reason, Beneficiary shall prefer to appoint a substitute trustee to act
instead of the aforenamed Trustee, Beneficiary shall have full power to appoint a substitute
trustee and, if preferred, several substitute trustees in succession who shall succeed to all the
estates, properties, rights, powers and duties of the aforenamed Trustee. Such appointment may be
executed by any authorized agent of Beneficiary, and if such Beneficiary be a corporation and such
appointment be executed in its behalf by any officer of such corporation, such appointment shall be
conclusively presumed to be executed with authority and shall be valid and sufficient without proof
of any action by the Board of Directors or any superior officer of the corporation. Grantor hereby
ratifies and confirms any and all acts which the aforenamed Trustee, or his successor or successors
in this trust, shall do lawfully by virtue hereof.




19









 







10.5 Perfection of Appointment. Should any deed, conveyance or instrument of any nature be
required from Grantor by any successor Trustee to more fully and certainly vest in and confirm to
such new Trustee such estates, rights, powers and duties, then, upon request by such Trustee, any
and all such deeds, conveyances and instruments shall be made, executed, acknowledged and delivered
and shall be caused to be recorded and/or filed by Grantor.



10.6 Succession Instruments. Any new Trustee appointed pursuant to any of the provisions
hereof shall, without any further act, deed or conveyance, become vested with all the estates,
properties, rights, powers and trusts of its or his predecessor in the rights hereunder with like
effect as if originally named as Trustee herein; but nevertheless, upon the written request of
Beneficiary or of the successor Trustee, the Trustee ceasing to act shall execute and deliver an
instrument transferring to such successor Trustee, upon the trusts herein expressed, all the
estates, properties, rights, powers and trusts of the Trustee so ceasing to act, and shall duly
assign, transfer and deliver any of the property and moneys held by such Trustee to the successor
Trustee so appointed in its or his place.



10.7 No Representation by Trustee. By accepting or approving anything required to be
observed, performed or fulfilled or to be given to Trustee or Beneficiary pursuant to the Security
Documents, including but not limited to, any officer’s certificate, balance sheet, statement of
profit and loss or other financial statement, survey, appraisal or insurance policy, neither
Trustee nor Beneficiary shall be deemed to have warranted, consented to, or affirmed the
sufficiency, legality, effectiveness or legal effect of the same, or of any term, provision or
condition thereof, and such acceptance or approval thereof shall not be or constitute any warranty,
consent or affirmation with respect thereto by Trustee or Beneficiary.




ARTICLE 11




MISCELLANEOUS



11.1 Performance at Grantor’s Expense. The cost and expense of performing or complying
with any and all of the Obligations shall be borne solely by Grantor and/or HEP to the extent
provided in the Pipelines and Terminals Agreement.



11.2 Survival of Obligations. Each and all of the Obligations shall survive the execution
and delivery of the Security Documents and shall continue in full force and effect until the
Obligations have been performed and discharged in full.



11.3 Further Assurances. Grantor, upon the request of Trustee or Beneficiary, will
execute, acknowledge, deliver and record and/or file such further instruments and do such further
acts as may be necessary, desirable or proper to carry out more effectively the purpose of the
Security Documents and to subject to the liens and security interests thereof any property intended
by the terms thereof to be covered thereby, including specifically but without limitation, any
renewals, additions, substitutions, replacements, betterments or appurtenances to the then
Mortgaged Property.




20









 







11.4 Recording and Filing. Grantor will cause the Security Documents and all amendments
and supplements thereto and substitutions therefor to be recorded, filed, re-recorded and refiled
in such manner and in such places as Trustee or Beneficiary shall reasonably request, and will pay
all such recording, filing, re-recording and refiling taxes, fees and other charges.



11.5 Notices. All notices or other communications required or permitted to be given
pursuant to this Deed of Trust shall be in writing and shall be considered as properly given if
mailed by first-class United States mail, postage prepaid, registered or certified with return
receipt requested, or by delivering same in person to the intended addressee or by prepaid
telegram. Notice so mailed shall be effective two days following its deposit. Notice given in any
other manner shall be effective only if and when received by the addressee. For purposes of
notice, the addresses of Beneficiary and Grantor shall be as set forth in Section 1.1(a) and the
opening recital hereinabove, respectively; provided, however, that either party shall have the
right to change its address for notice hereunder to any other location within the continental
United States by the giving of thirty (30) days’ notice to the other party in the manner set forth
hereinabove.



11.6 No Waiver. Any failure by Trustee or Beneficiary to insist, or any election by
Trustee or Beneficiary not to insist, upon strict performance by Grantor of any of the terms,
provisions or conditions of the Security Documents shall not be deemed to be a waiver of same or of
any other terms, provision or condition thereof and Trustee or Beneficiary shall have the right at
any time or times thereafter to insist upon strict performance by Grantor of any and all of such
terms, provisions and conditions.



11.7 Beneficiary’s Right to Perform the Obligations. If Grantor shall fail, refuse or
neglect to make any payment or perform any act required by the Security Documents (after giving
effect to any applicable notice and cure period), then at any time thereafter, and without further
notice to or demand upon Grantor and without waiving or releasing any other right, remedy or
recourse Beneficiary may have because of same, Beneficiary may (but shall not be obligated to) make
such payment or perform such act for the account of and at the expense of Grantor, and shall have
the right to enter upon or in the Real Property for such purpose and to take all such action
thereon and with respect to the Mortgaged Property as it may deem necessary or appropriate but in
any case subject to the rights of any Lienholder arising under or pursuant to the Senior Liens and
the terms and provisions of the SNDA. If Beneficiary shall elect to pay any Imposition or other
sums due with reference to the Mortgaged Property, Beneficiary may do so in reliance on any bill,
statement or assessment procured from the appropriate Governmental Entity or other issuer thereof
without inquiring into the accuracy or validity thereof. Similarly, in making any payments to
protect the security intended to be created by the Security Documents, Beneficiary shall not be
bound to inquire into the validity of any apparent or threatened adverse title, lien, encumbrance,
claim or charge before making an advance for the purpose of preventing or removing the same.
Grantor shall indemnify Beneficiary for all losses, expenses, damage, claims and causes of action,
including reasonable attorneys’ fees, incurred or accruing by reason of any acts performed by
Beneficiary pursuant to the provisions of this Section 11.7 or by reason of any other provision in
the Security Documents. All sums paid by Beneficiary pursuant to this Section 11.7 and all other
sums expended by Beneficiary to which it shall be entitled to be indemnified, together with
interest thereon at the maximum rate allowed by law from the date of




21









 







such payment or expenditure, shall be secured by the Security Documents and shall be paid by
Grantor to Beneficiary upon demand.



11.8 Covenants Running with the Land. All Obligations contained in the Security Documents
are intended by the parties to be, and shall be construed as, covenants running with the Mortgaged
Property.



11.9 Successors and Assigns. All of the terms of the Security Documents shall apply to, be
binding upon and inure to the benefit of the parties thereto, their successors and assigns, and all
other Persons claiming by, through or under them.



11.10 Severability. The Security Documents are intended to be performed in accordance
with, and only to the extent permitted by, all applicable Legal Requirements. If any provision of
any of the Security Documents or the application thereof to any Person or circumstance shall, for
any reason and to any extent, be invalid or unenforceable neither the remainder of the instrument
in which such provision is contained nor the application of such provision to other Persons or
circumstances nor the other instruments referred to hereinabove shall be affected thereby, but
rather shall be enforced to the greatest extent permitted by law.



11.11 Entire Agreement and Modification. The Security Documents contain the entire
agreements between the parties relating to the subject matter hereof and thereof and all prior
agreements relative thereto which are not contained herein or therein are terminated.
Notwithstanding anything herein to the contrary, Grantor and, by its acceptance hereof, Beneficiary
hereby acknowledge and agree that in the event that any of the terms or provisions of this Deed of
Trust conflict with any terms or provisions of the Pipelines and Terminals Agreement, the terms or
provisions of the Pipelines and Terminals Agreement shall govern and control for all purposes .
The Security Documents may not be amended, revised, waived, discharged, released or
terminated orally but only by a written instrument or instruments (a) executed by the party against
which enforcement of the amendment, revision, waiver, discharge, release or termination is
asserted, and (b) consented to by the Lienholders to the extent any such amendment, revision,
waiver, discharge, release or termination would be materially adverse to the rights of any such
Lienholder. Any alleged amendment, revision, waiver, discharge, release or termination which is
not so documented shall not be effective as to any party.



11.12 Counterparts. This Deed of Trust may be executed in any number of counterparts, each
of which shall be an original but all of which together shall constitute but one instrument.



11.13 Applicable Law. The Security Documents shall be governed by and construed according
to the laws of the State of Texas (excluding any conflicts of law, rule or principle that might
refer such matters to the laws of another jurisdiction).



11.14 No Partnership. Nothing contained in the Security Documents is intended to, or shall
be construed as, creating to any extent and in any manner whatsoever, any partnership, joint
venture, or association between Grantor, Trustee and Beneficiary, or in any way make




22









 







Beneficiary or Trustee coprincipals with Grantor with reference to the Mortgaged Property, and any
inferences to the contrary are hereby expressly negated.



11.15 Headings. The Article, Section and Subsection entitlements hereof are inserted for
convenience of reference only and shall in no way alter, modify or define, or be used in
construing, the text of such Articles, Sections or Subsections.



11.16 Waiver of Stay, Moratorium, and Similar Rights. Grantor agrees, to the full extent
that it may lawfully do so, that it will not at any time insist upon or plead or in any way take
advantage of any appraisement, valuation, stay, marshalling of assets, extension, redemption or
moratorium law now or hereafter in force and effect so as to prevent or hinder the enforcement of
the provisions of this Deed of Trust or the indebtedness secured hereby, or any agreement between
Grantor and Beneficiary or any rights or remedies Beneficiary may have thereunder, hereunder or by
law.



11.17 Transfer of Mortgaged Property. No sale, lease, exchange, assignment, conveyance or
other transfer (each, a “Transfer”) of the Mortgaged Property will extinguish the lien or
security interest created by this Deed of Trust, except to the extent provided in Section 9.6 of
this Deed of Trust or in the Pipelines and Terminals Agreement. As a condition to any Transfer,
Beneficiary may (a) require the express assumption of the Obligations by the transferee (with or
without the release of Grantor from liability in respect thereof), and (b) require the execution of
an assumption agreement, modification agreements, supplemental security documents and financing
statements satisfactory in form and substance to Beneficiary.



11.18 Estoppel Certificates. Grantor and Beneficiary agree to execute and deliver from
time to time, upon the request of the other party, a certificate regarding the status of the
Pipelines and Terminals Agreement, consisting of statements, if true (or if not, specifying why
not), (a) that the Pipelines and Terminals Agreement is in full force and effect, (b) the date
through which payments have been paid, (c) the date of the commencement of the term of the
Pipelines and Terminals Agreement, (d) the nature of any amendments or modifications of the
Pipelines and Terminals Agreement, (e) to such party’s actual knowledge without investigation, no
default, or state of facts which with the passage of time or notice (or both) would constitute a
default, exists under the Pipelines and Terminals Agreement, (f) to such party’s actual knowledge
without investigation, no setoffs, recoupments, estoppels, claims or counterclaims exist against
the other party under the Pipelines and Terminals Agreement, and (g) such other factual matters as
may be reasonably requested.



11.19 Final Agreement. Grantor acknowledges receipt of a copy of this instrument at the
time of execution hereof. Grantor acknowledges that, except as incorporated in writing in this
Deed of Trust, there are not, and were not, and no persons are or were authorized to make any
representations, understandings, stipulations, agreements or promises, oral or written, with
respect to the matters addressed in this Deed of Trust. THE WRITTEN AGREEMENTS HEREIN REPRESENT
THE FINAL AGREEMENT BETWEEN THE PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.




23









 








[SIGNATURE PAGE TO FOLLOW]





24









 








     WITNESS THE EXECUTION HEREOF as of the date first above written.



	 	 	 	 	 
	 	 	GRANTOR:
	 
	 	 	 	 
	 	 	HEP FIN-TEX/TRUST-RIVER, L.P.,
 a Texas limited partnership
	 
	 	 	 	 
	

	 	By:
	 	HEP Pipeline GP, L.L.C., a Delaware 

limited liability company, its General

Partner
	 
	 	 	 	 
	

	 	By:
	 	Holly Energy Partners — Operating, L.P.,

a Delaware limited partnership,

its Sole Member
	 
	 	 	 	 
	

	 	By:
	 	HEP Logistics GP, L.L.C.,

a Delaware limited liability company,

its General Partner
	 
	 	 	 	 
	

	 	By:
	 	Holly Energy Partners, L.P.,

a Delaware limited partnership,

its Sole Member
	 
	 	 	 	 
	

	 	By:
	 	HEP Logistics Holdings, L.P.,

a Delaware limited partnership,

its General Partner
	 
	 	 	 	 
	

	 	By:
	 	Holly Logistic Services, L.L.C.,

a Delaware limited liability company,

its General Partner
	 
	 	 	 	 
	

	 	By:
	 	W. John Glancy,

	

	 	 
	 	
Vice President, General Counsel and 

Secretary






	 	 	 
	EMPLOYER IDENTIFICATION NUMBER OF GRANTOR:

	 	______________________________

	 
	 	 
	ORGANIZATIONAL NUMBER OF GRANTOR:

	 	______________________________







[Signature Page]




 









 








	 	 	 
	THE STATE OF TEXAS

	 	§
	

	 	§
	COUNTY OF DALLAS

	 	§






     THIS INSTRUMENT was acknowledged before me on March 1, 2005 by W. John Clancy, Vice President,
General Counsel and Secretary of Holly Logistic Services, L.L.C., a Delaware limited liability
company, as General Partner of HEP Logistics Holdings, L.P., a Delaware limited partnership, as
General Partner of Holly Energy Partners, L.P., a Delaware limited partnership, the Sole Member of
HEP Logistics GP, L.L.C., a Delaware limited liability company, as General Partner of Holly Energy
Partners – Operating, L.P., a Delaware limited partnership, the Sole Member of HEP Pipeline GP,
L.L.C., a Delaware limited liability company, as General Partner of HEP Fin-Tex/Trust-River, L.P.,
a Texas limited partnership, on behalf of such entities.



	 	 	 
	

	 	________________________________

Notary Public in and for the State of Texas
	 
	 	 
	_______________________

My Commission Expires

	 	________________________________

Printed Name of Notary






[Acknowledgement Page]




 









 








Exhibit A




	 	 	 
	Part I -
	 	Description of Terminals
	 
	 	 
	Part II -
	 	Description of Terminal Fee Land
	 
	 	 
	Part III -
	 	Terminal Leases
	 
	 	 
	Part IV -
	 	Terminal Easements
	 
	 	 
	Part V -
	 	Terminal Improvements
	 
	 	 
	Part VI -
	 	Terminal Equipment
	 
	 	 
	Part VII -
	 	Terminal Contracts
	 
	 	 
	Part VIII -
	 	Intellectual Property
	 
	 	 
	Part IX -
	 	Terminal Permits






A-1




 









 








EXHIBIT B




	 	 	 
	Part I -
	 	Description of Pipelines
	 
	 	 
	Part II -
	 	Description of Pipeline Fee Land
	 
	 	 
	Part III -
	 	Pipeline Leases
	 
	 	 
	Part IV -
	 	Pipeline Easements
	 
	 	 
	Part V -
	 	Pipeline Improvements
	 
	 	 
	Part VI -
	 	Pipeline Equipment
	 
	 	 
	Part VII -
	 	Pipeline Contracts
	 
	 	 
	Part VIII -
	 	Intellectual Property
	 
	 	 
	Part IX -
	 	Pipeline Permits






B-1




 









 








ATTACHMENT 1




FORM OF SUBORDINATION, NON-DISTURBANCE

AND ATTORNMENT AGREEMENT




After recording, return to:

Bracewell & Patterson, L.L.P.

South Tower Pennzoil Place

711 Louisiana Street, Suite 2900

Houston, Texas 77002

Attn: Stephanie Koo Song



SUBORDINATION, NON-DISTURBANCE

AND ATTORNMENT AGREEMENT




          This Subordination, Non-Disturbance and Attornment Agreement (this “Agreement”) is
executed as of March 1, 2005, among Union Bank of California, N.A., in its capacity as
administrative agent (or any assignee of or successor to such administrative agent) under the
Credit Agreement (as defined below) and on behalf of the Credit Parties (as defined below)
(“Administrative Agent”), and Alon USA, LP, a Texas limited partnership (“Alon”)
and Credit Suisse First Boston, acting through its Cayman Islands Branch, in its capacity as
administrative agent and collateral agent (or any assignee of or successor to such administrative
agent and/or collateral agent) (“Alon Administrative Agent”) for the Secured Parties (as
defined in the Guarantee and Collateral Agreement, dated as of January 14, 2004 (the “Alon
Security Agreement”), among Alon USA, Inc., the subsidiaries of Alon USA, Inc. party thereto
and Alon Administrative Agent, as amended, extended, renewed, restated, supplemented or otherwise
modified from time to time), and its successors in such capacity. [Paragraph to be
revised/conformed for Alon Revolving Agent]



RECITALS:




          A. Holly Energy Partners – Operating, L.P., a Delaware limited partnership
(“Operating”), the financial institutions party thereto from time to time (individually, a
“Financial Institution” and collectively, the “Financial Institutions”), the
Financial Institutions issuing letters of credit thereunder from time to time, if any
(individually, an “Issuing Bank” and collectively, the “Issuing Banks”), the
Financial Institutions or any affiliate thereof that have entered into hedging arrangements with
Operating or any subsidiary thereof from time to time (individually, a “Swap Counterparty”
and collectively, the “Swap Counterparties” and, together with Administrative Agent, the
Financial Institutions and the Issuing Banks, being collectively referred to herein as the
“Credit Parties”) are parties to that certain Credit Agreement dated as of July 7, 2004 (as
heretofore and hereafter renewed, extended, amended, supplemented, replaced, modified and/or
restated from time to time, the “Credit Agreement”).



1-1









 





          B. The Financial Institutions are the present owners and holders of certain promissory notes
dated July 7, 2004, in the aggregate principal amount of $100,000,000, executed by Operating and
payable to the order of each such Financial Institution (as heretofore and hereafter renewed,
extended, amended, supplemented, replaced, modified, and/or restated from time to time, the
“Notes”). Administrative Agent, for the ratable benefit of the Credit Parties, is the
beneficiary of that certain (i) Mortgage, Deed of Trust, Security Agreement, Assignment of Rents
and Leases, Fixture Filing and Financing Statement dated as of March 1 2005 (as heretofore and
hereafter renewed, extended, amended, supplemented, replaced, modified, and/or restated from time
to time, the “Senior Texas Deed of Trust”), and (ii) Mortgage, Security Agreement,
Assignment of Rents and Leases, Fixture Filing and Financing Statement dated as of March 1, 2005
(as heretofore and hereinafter received, extended, amended, supplemented, replaced, modified,
and/or restated from time to time, the “Senior Oklahoma Mortgage” and, together with the
Senior Texas Deed of Trust, collectively, the “Senior Mortgage”), and the secured party
under certain other security agreements and documents entered into in connection with the Credit
Agreement (as heretofore and hereafter renewed, extended, amended, supplemented, replaced,
modified, and/or restated from time to time, the “Security Instruments” and, together with
the Credit Agreement, the Notes, the Senior Mortgage and any other documents, instruments and
agreements executed and/or delivered in connection with the Credit Agreement, collectively, the
“Senior Loan Documents”).



          C. Pursuant to the Senior Loan Documents and to secure the Notes and the other Secured
Obligations (as defined in the Senior Mortgage), HEP Fin-Texas/Trust River, L.P., a Texas limited
partnership (“HEP Fin-Tex”) and a subsidiary of Holly Energy Partners, L.P., a Delaware
limited partnership (“HEP”) granted a security interest and mortgage lien to or for the
benefit of Administrative Agent, covering the right, title and interest of HEP Fin-Tex in certain
property described in Exhibit A attached hereto (the “Property”).



          D. Alon is the current owner of certain rights and interests under and pursuant to the
provisions of that certain Pipelines and Terminals Agreement dated as of February 28, 2005 between
HEP and Alon (together with any amendments, restatements or modifications from time to time made
thereto, the “Pipeline and Terminals Agreement”).



          E. Alon is the current beneficiary of certain liens and security interests in a portion of the
Property (the “Subordinated Liens”) under and pursuant to the provisions of that certain
(i) Mortgage and Deed of Trust (with Security Agreement and Financing Statement) (the “Alon
Texas Deed of Trust”) dated as of March 1, 2005 executed by HEP Fin-Tex to Harlin R. Dean,
Trustee, for the benefit of Alon, securing the Obligations (as defined in the Alon Texas Deed of
Trust), such Alon Texas Deed of Trust being recorded (or to be recorded) in various counties in the
State of Texas, and (ii) Mortgage (with Security Agreement and Financing Statement) (the “Alon
Oklahoma Mortgage” and, together with the Alon Texas Deed of Trust, collectively, the “Alon
Mortgage”) dated as of March 1, 2005 executed by HEP Fin-Tex to Alon, securing the Obligations
(as defined in the Alon Oklahoma Mortgage), such Alon Oklahoma Mortgage being recorded (or to be
recorded) in various counties in the state of Oklahoma.



          F. Alon has agreed to subordinate its Subordinated Liens under the Alon Mortgage (but not,
pursuant to this Agreement, any of its rights and interests under the Pipelines and Terminals
Agreement) to (i) the Senior Mortgage and the other Senior Loan Documents, and (ii)



1-2









 




any other mortgage, deed of trust or security instrument granted by a Purchaser (as defined
below) or any subsequent purchaser of any portion of the Mortgaged Property (as heretofore and
hereafter renewed, extended, amended, supplemented, replaced, modified, and/or restated from time
to time, a “Future Senior Mortgage”) that secures debt and obligations of, and other
extensions of credit to, such Purchaser or purchaser (together with the Secured Obligations (as
defined in the Senior Mortgage), referred to herein as the “Senior Secured Obligations”)
and Administrative Agent has agreed that it and any such Purchaser at foreclosure of the Senior
Mortgage shall recognize and not disturb or extinguish the Alon Mortgage, all on the terms and
conditions hereinafter set forth.




AGREEMENTS:




          NOW, THEREFORE, in consideration of Ten Dollars ($10) and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, Administrative Agent
and Alon hereby covenant and agree as follows:




	1.  	Subordination of Alon Mortgage.





               (a) Subject to the provisions of Section 3 and Section 4 hereof, the
Subordinated Liens of Alon under the Alon Mortgage and all of the terms, covenants and provisions
of the Alon Mortgage, and all rights, remedies and options of Alon thereunder, are and shall at all
times continue to be subject, subordinate and inferior in all respects to the Senior Loan Documents
and any Future Senior Mortgage and to the liens and security interests thereof and to all
amendments, modifications, and replacements thereof, with the same force and effect as if the
Senior Loan Documents, or if applicable, the Future Senior Mortgage, had been executed, delivered
and recorded prior to the execution, delivery and recordation of the Alon Mortgage. This Agreement
is not intended, and shall not be construed, to (i) subordinate the rights and interests of Alon
under the Pipelines and Terminals Agreement (including Alon’s right to quiet enjoyment under the
Pipelines and Terminals Agreement or any claims, remedies or damages that may be due or available
to, or become due or available to, Alon under the Pipelines and Terminals Agreement), or (ii)
subordinate the Alon Mortgage to any mortgage, deed of trust, assignment, security agreement,
financing statement or other security document, other than, with respect to clause (ii), the Senior
Loan Documents and the Future Senior Mortgage. Nothing in this Agreement shall impair, as between
HEP or Operating, on the one hand, and Alon, on the other hand, the obligations of HEP and
Operating, which are absolute and unconditional, to perform the Obligations in accordance with
their terms.



               (b) Notwithstanding anything herein or in the Alon Mortgage to the contrary, Alon hereby
acknowledges and agrees, and HEP Fin-Tex by its consent to this Agreement acknowledges and agrees,
that (i) in the event that any of the terms or provisions of this Agreement conflict with any terms
or provisions of the Alon Mortgage, the terms or provisions of this Agreement shall govern and
control for all purposes; and (ii) without the written prior consent of the Administrative Agent or
the beneficiary of any Future Senior Mortgage (together with the Credit Parties, the “Senior
Beneficiaries”), neither Alon nor HEP Fin-Tex (nor any future owner of the Mortgaged Property)
will amend, revise, supplement, replace, restate, or otherwise modify the Alon Mortgage if such
amendment, revision, supplement, replacement,



1-3









 




restatement or other modification would be materially adverse to the rights of any Senior
Beneficiary.





	2.  	Relative Rights and Priorities. Subject to the provisions of Section 1,
Section 3 and Section 4 hereof:





               (a) Until the Senior Secured Obligations have been indefeasibly paid in full, all commitments
to extend credit under the Credit Agreement (or if applicable, any agreement governing obligations
secured by a Future Senior Mortgage) have terminated, and all letters of credit issued thereunder
have been terminated and returned (the “Senior Obligations Payment Date”), Alon will not
commence any foreclosure (whether a judicial foreclosure or non-judicial foreclosure) of the Alon
Mortgage or accept a deed or assignment in lieu of foreclosure.



               (b) Alon agrees that, until the Senior Obligations Payment Date has occurred:




                    (i) it will not take or cause to be taken any action, the purpose or effect of which is
to make any Subordinated Lien pari passu with or senior to, or to give Alon any preference
or priority relative to, the liens and security interests with respect to the Senior Secured
Obligations;




                    (ii) it will not oppose, object to, interfere with, hinder or delay, in any manner,
whether by judicial proceedings (including without limitation the filing of an Insolvency
Proceeding (as herein defined)) or otherwise, any foreclosure, sale, lease, exchange,
transfer or other disposition of the Mortgaged Property (as defined in the Alon Mortgage and
with the same meaning herein as therein defined) by any of the Senior Beneficiaries or any
other Enforcement Action taken by or on behalf of any of the Senior Beneficiaries;




                    (iii) it has no right to (x) direct any of the Senior Beneficiaries to exercise any
right, remedy or power with respect to the Mortgaged Property or pursuant to the Senior Loan
Documents or any Future Senior Mortgage or (y) consent or object to the exercise by any of
the Senior Beneficiaries of any right, remedy or power with respect to the Mortgaged
Property or pursuant to the Senior Loan Documents or any Future Senior Mortgage or to the
timing or manner in which any such right is exercised or not exercised (or, to the extent
they may have any such right described in this clause (iii), whether as a junior lien
creditor or otherwise, they hereby irrevocably waive such right); and




                    (iv) it will not institute any suit or other proceeding or assert in any suit,
Insolvency Proceeding or other proceeding any claim against any of the Senior Beneficiaries
seeking damages from or other relief by way of specific performance, instructions or
otherwise, with respect to, and none of the Senior Beneficiaries shall be liable for any
action taken or omitted to be taken by any of the Senior Beneficiaries with respect to the
Mortgaged Property or pursuant to the Senior Loan Documents or any Future Senior Mortgage.



               (c) Until the Senior Obligations Payment Date has occurred, Alon agrees that it shall not, in
or in connection with any Insolvency Proceeding, file any pleadings or motions,



1-4









 




take any position at any hearing or proceeding of any nature, or otherwise take any action
whatsoever, in each case, that is inconsistent with the terms or spirit of, or intent of the
parties with respect to, this Agreement, including, without limitation, with respect to the
determination of any liens or claims held by any of the Senior Beneficiaries (including the
validity and enforceability thereof) or the value of any claims of such parties under the United
States Bankruptcy Code or otherwise; provided that Alon may file a proof of claim in an
Insolvency Proceeding, subject to the limitations contained in this Agreement and only if
consistent with the terms and the limitations imposed hereby.




               (d) Until the Senior Obligations Payment Date has occurred, whether or not an Insolvency
Proceeding has been commenced by or against the owner of the Mortgaged Property, any of the Senior
Beneficiaries shall have the exclusive right to take and continue any Enforcement Action with
respect to the Mortgaged Property, without any consultation with or consent of Alon. Upon the
occurrence and during the continuance of a default or an event of default under the Senior Loan
Documents or any Future Senior Mortgage, any of the Senior Beneficiaries may take and continue any
Enforcement Action with respect to the Senior Secured Obligations and the Mortgaged Property in
such order and manner as they may determine in their sole discretion.



               (e) Alon shall not object to or contest, or support any other person or entity in contesting
or objecting to, in any proceeding (including without limitation, any Insolvency Proceeding), the
validity, extent, perfection, priority or enforceability of any lien or security interest in the
Mortgaged Property granted in favor of any of the Senior Beneficiaries. Notwithstanding any
failure by any of the Senior Beneficiaries or Alon or their respective representatives to perfect
its liens in the Mortgaged Property or any avoidance, invalidation or subordination by any third
party or court of competent jurisdiction of the liens in the Mortgaged Property granted in favor of
any of the Senior Beneficiaries or Alon, the priority and rights as between any of the Senior
Beneficiaries and Alon and their representatives with respect to the Mortgaged Property shall be as
set forth herein.



          As used in this Section 2, the following terms shall have the following meanings:



          “Enforcement Action” means any demand for payment or acceleration thereof, the
bringing of any lawsuit or other proceeding, the exercise of any rights and remedies, directly or
indirectly, with respect to any Mortgaged Property, any enforcement or foreclosure of any lien or
security interest, any sale in lieu of foreclosure, the taking of possession, exercise of any
offset, repossession, garnishment, sequestration or execution, any collection of any Mortgaged
Property, any notice to account debtors on any Mortgaged Property or the commencement or
prosecution of enforcement of any of the rights and remedies under the Senior Loan Documents or
applicable law, including without limitation the exercise of any rights of set-off or recoupment,
and the exercise of any rights or remedies of a secured creditor under the uniform commercial code
of any applicable jurisdiction, under the United States Bankruptcy Code, as amended from time to
time or otherwise; provided, that, the exercise or enforcement by Alon of its rights under the
Pipelines and Terminals Agreement shall not constitute an Enforcement Action.



          “Insolvency Proceeding” means any proceeding in respect of bankruptcy, insolvency,
winding up, receivership, dissolution or assignment for the benefit of creditors, in each of the



1-5









 




foregoing events whether under the United States Bankruptcy Code, as amended from time to time
or any similar federal, state or foreign bankruptcy, insolvency, reorganization, receivership or
similar law.



3. Recognition and Non-Disturbance of Alon Mortgage. If Administrative Agent, any other
Credit Party or any other person (Administrative Agent, any other Credit Party or such other person
being herein called a “Purchaser”) shall become the owner of any part of the Property by
reason of the foreclosure (whether a judicial foreclosure or non-judicial foreclosure) of the
Senior Mortgage or the acceptance of a deed or assignment in lieu of foreclosure or otherwise (any
of such being herein called a “Foreclosure Event”), then for so long as the Pipelines and
Terminals Agreement is in effect, the Purchaser shall (i) recognize the Alon Mortgage, and the Alon
Mortgage shall not be terminated or affected thereby, but shall continue in full force and effect
upon all of the terms, covenants and conditions set forth in the Alon Mortgage, and (ii) be bound
by and subject to all of the terms, provisions, covenants and conditions of the Alon Mortgage;
provided, that, the Alon Mortgage shall be subordinated to any Future Senior Mortgage, regardless
of whether such Future Senior Mortgage is a direct replacement of an existing Senior Mortgage or
Security Instrument, and any such Future Senior Mortgage shall be considered a “Senior Mortgage”
for purposes of this Agreement and the Alon Mortgage. Administrative Agent shall not name Alon as
a party in any foreclosure or other proceeding relating to the Senior Mortgage or Notes, and shall
not claim, or seek adjudication, that the Alon Mortgage has been terminated or otherwise adversely
affected by any Foreclosure Event.



4. Pipelines and Terminals Agreement. Administrative Agent recognizes and confirms that
the Pipelines and Terminals Agreement, and the rights and interests of Alon thereunder, shall in no
way be restricted, limited or otherwise affected by this Agreement, the Alon Mortgage, the Senior
Mortgage, any Future Senior Mortgage, the Security Instruments or any liens or security interests
thereof; provided, however, that, Alon agrees that nothing in the Pipelines and Terminals Agreement
shall (a) prevent any Purchaser or subsequent purchaser from owning or operating the Mortgaged
Property, so long as such Purchaser or subsequent purchaser shall have assumed, and be in
compliance with, HEP’s obligations under the Pipelines and Terminals Agreement and shall have
executed an “SNDA” as defined in, and in accordance with, Article 6 of the Alon Mortgage, or (b) be
deemed to invalidate or require the release of any Senior Beneficiary’s liens in the Mortgaged
Property in connection with the exercise by Alon of a purchase option under the Pipelines and
Terminals Agreement or otherwise. Administrative Agent, both for itself and for any Purchaser,
further agrees that upon any Foreclosure Event, the Pipelines and Terminals Agreement shall not be
terminated or affected thereby, nor shall Alon’s right to ship or store petroleum products through
the pipelines or in the terminals, respectively, constituting a portion of the Property in
accordance with the provisions of the Pipelines and Terminals Agreement (or any other rights of
Alon under the Pipelines and Terminals Agreement) be affected or disturbed because of the
Foreclosure Event, but rather the Pipelines and Terminals Agreement shall continue in full force
and effect as direct obligations between the Purchaser and Alon, upon all of the terms, covenants
and conditions set forth in the Pipelines and Terminals Agreement. Neither Administrative Agent
nor any Purchaser shall name Alon as a party in any foreclosure or other proceeding relating to the
Senior Mortgage or Notes, and neither Administrative Agent nor any Purchaser shall claim, or seek
adjudication, that the Pipelines and Terminals Agreement has been terminated or otherwise adversely
affected by any Foreclosure




1-6









 







Event. Notwithstanding the foregoing, in the event that the Pipelines and Terminals Agreement is
rejected in bankruptcy or is otherwise terminated, the Purchaser shall, promptly upon request by
Alon, enter into a pipelines and terminals agreement with Alon on substantially the same terms (and
with tariffs and minimum volumes commensurate with those then applicable under the Pipelines and
Terminals Agreement) and conditions as the rejected or terminated Pipelines and Terminals
Agreement, but having a term commencing on the date on which Purchaser acquired title to any
portion of the Property. The immediately preceding sentence shall be deemed to be a covenant
running with the land and shall be binding on any person or entity that acquires title to all or
party of the Property by, through or under the Senior Mortgage.



5. Attornment With Respect to the Pipelines and Terminals Agreement. Upon the occurrence
of any Foreclosure Event, Alon shall attorn to the Purchaser, the Purchaser shall accept such
attornment, and the Purchaser and Alon shall be bound to each other under all of the terms,
provisions, covenants and conditions of the Pipelines and Terminals Agreement; provided,
that, except for Alon’s express rights and remedies under the Pipelines and Terminals
Agreement, in no event shall the Purchaser be liable for any act, omission, default,
misrepresentation, or breach of warranty of HEP or HEP Fin-Tex (or any owner of the Mortgaged
Property prior to such Purchaser) or obligations accruing prior to Purchaser’s actual ownership of
the Property. The provisions of this Agreement regarding attornment by Alon shall be
self-operative and effective without the necessity of execution of any new document on the part of
any party hereto or the respective heirs, legal representatives, successors or assigns of any such
party. Alon agrees, however, to execute and deliver upon the request of Purchaser, any instrument
or certificate which in the reasonable judgment of Purchaser may be necessary or appropriate to
evidence such attornment.



6. Estoppel Certificate. Alon agrees to execute and deliver from time to time, upon the
request of any of the Senior Beneficiaries, a certificate regarding the status of the Pipelines and
Terminals Agreement, consisting of statements, if true (or if not, specifying why not), (a) that
the Pipelines and Terminals Agreement is in full force and effect, (b) the date through which
payments have been paid, (c) the date of the commencement of the term of the Pipelines and
Terminals Agreement, (d) the nature of any amendments or modifications of the Pipelines and
Terminals Agreement, (e) to Alon’s actual knowledge without investigation, no default, or state of
facts which with the passage of time or notice (or both) would constitute a default, exists under
the Pipelines and Terminals Agreement, (f) to Alon’s actual knowledge without investigation, no
setoffs, recoupments, estoppels, claims or counterclaims exist against HEP under the Pipelines and
Terminals Agreement, and (g) such other factual matters as may be reasonably requested.



7. [Intentionally Omitted].



8. Reliance on Notices. HEP Fin-Tex agrees that Alon may rely upon any and all notices
from Administrative Agent or any Purchaser, even if such conflict with notices from HEP Fin-Tex.



9. Notices. All notices, consents and other communications pursuant to the provisions of
this Agreement shall be in writing and shall be sent by (a) registered or certified mail, postage




1-7









 







prepaid, return receipt requested, (b) nationally recognized overnight delivery service, or (c)
telecopier, addressed as follows:




	 	 	 	 	 
	

	 	If to Administrative Agent:
	 	Union Bank of California, N.A.

445 South Figueroa Street, 15th Floor

Los Angeles, California 90071

Attention: Don Smith

Telecopy: (213) 236-6823
	 
	 	 	 	 
	

	 	If to Alon:
	 	Alon USA, LP

7616 LBJ Freeway, Suite 300

Dallas, Texas 75251

Attention: General Counsel

Telecopy: (972) 367-3723






     Notice sent by registered or certified mail, postage prepaid, return receipt requested, shall
be deemed given and received on the third Business Day (hereinafter defined) after being deposited
in the United States mail, notice sent by nationally recognized overnight delivery service shall be
deemed given in conformity with this paragraph and received on the first Business Day after being
deposited with such delivery service, and notice given by telecopier shall be deemed given and
received upon actual receipt if received during the recipient’s normal business hours or at the
beginning of the recipient’s next Business Day after receipt if not received during the recipient’s
normal business hours. Each party may designate a change of address by notice to the other party.
“Business Day” means a day upon which commercial banks are not authorized or required by
law to close in Dallas, Texas.


10. Binding Effect. This Agreement shall be binding upon Administrative Agent and Alon and
inure to the benefit of the Senior Beneficiaries and Alon and their respective successors and
assigns. Alon assigns to Alon Administrative Agent its rights hereunder and under the Pipelines
and Terminals Agreement by way of a collateral assignment. The parties agree that any person that
shall become the owner of any of the rights of Alon hereunder or under the Pipelines and Terminals
Agreement by reason of the foreclosure (whether a judicial foreclosure or non-judicial foreclosure
and including, without limitation, Alon Administrative Agent) of the Alon Security Agreement or the
acceptance of a deed or assignment in lieu of foreclosure or otherwise pursuant to the exercise by
Alon Administrative Agent of its rights under the Alon Security Agreement (“Alon
Successor”) shall (a) have the same rights as Alon hereunder and under the Pipelines and
Terminals Agreement, including, without limitation, under this Section 10, and (b) be bound
by and subject to all of the terms, provisions, covenants and conditions of this Agreement. HEP
Fin-Tex has assigned to Administrative Agent its rights hereunder, and HEP has assigned to
Administrative Agent its rights under the Pipelines and Terminals Agreement by way of a collateral
assignment. The parties agree that any person that shall become the owner of any of the rights of
HEP Fin-Tex hereunder, or any of the rights of HEP under the Pipelines and Terminals Agreement by
reason of foreclosure (whether a judicial foreclosure or non-judicial foreclosure and including,
without limitation, Administrative Agent) or the acceptance of a deed or assignment in lieu of
foreclosure or otherwise shall (i) have the same rights as HEP Fin-Tex hereunder, and HEP under the
Pipelines and Terminals Agreement, including, without limitation,




1-8









 







under this Section 10, and (ii) be bound by and subject to all of the terms, provisions,
covenants and conditions of this Agreement.



11. General Definitions. The term “Administrative Agent” as used herein shall
include the successors and assigns of Administrative Agent. The term “HEP” as used herein
shall include the successors and assigns of HEP under the Pipelines and Terminals Agreement, but
shall not mean or include Administrative Agent. The term “Property” as used herein shall
mean the Property, the improvements now or hereafter located thereon and the estates therein
encumbered by the Senior Mortgage. The term “Alon” as used herein shall include the
successors and assigns of Alon hereunder and under the Pipelines and Terminals Agreement including,
without limitation, any Alon Successor.



12. Modifications. This Agreement may not be modified in any manner or terminated except
by an instrument in writing executed by the parties hereto.



13. Governing Law. This Agreement shall be governed by and construed under the laws of the
State in which the Property is located.



14. Duplicate Originals; Counterparts. This Agreement may be executed in any number of
duplicate originals and each duplicate original shall be deemed to be an original. This Agreement
may be executed in several counterparts, each of which counterparts shall be deemed an original
instrument and all of such together shall constitute a single Agreement.




[REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]




1-9









 








          IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the date first
above written.



	 	 	 	 	 	 	 	 	 	 	 
	ADMINISTRATIVE AGENT:	 	UNION BANK OF CALIFORNIA, N.A.,

as Administrative Agent	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	By:	 	 	 	 	 	 	 	 
	 	 	 	 	 
Sean Murphy, Vice President	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	ALON:	 	ALON USA, LP	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	Alon USA GP, LLC,

its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	 	By:	 	 	 	 	 	 
	

	 	 	 	 	 	

Jeff D. Morris, President and

Chief Executive Officer	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 





	 	 	 	 	 	 	 	 	 
	ALON ADMINISTRATIVE AGENT:	 	CREDIT SUISSE FIRST BOSTON,

acting through its Cayman Islands Branch,

as Alon Administrative Agent
	 
	 	 	 	 	 	 	 	 
	

	 	By:	 	 	 	 	 	 
	

	 	 	 	 	 	 	 	 
	

	 	Name:	 	 	 	 	 	 
	

	 	 	 	 	 	 	 	 
	

	 	Title:	 	 	 	 	 	 
	

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	

	 	By:	 	 	 	 	 	 
	

	 	 	 	 	 	 	 	 
	

	 	Name:	 	 	 	 	 	 
	

	 	 	 	 	 	 	 	 
	

	 	Title:	 	 	 	 	 	 
	

	 	 	 	 	 	 	 	 






1-10









 






HEP FIN-TEX’S CONSENT



The undersigned hereby consents to the foregoing Subordination, Non-Disturbance and Attornment
Agreement and, without limitation, agrees to the provisions of Section 8 thereof.




	 	 	 	 	 
	HEP FIN-TEX:	 	HEP FIN-TEX/TRUST-RIVER, L.P.,

a Texas limited partnership
	 
	 	 	 	 
	

	 	By:
	 	HEP Pipeline GP, L.L.C., a Delaware

limited liability company, its General

Partner
	 
	 	 	 	 
	

	 	By:
	 	Holly Energy Partners — Operating, L.P.,

a Delaware limited partnership,

its Sole Member
	 
	 	 	 	 
	

	 	By:
	 	HEP Logistics GP, L.L.C.,

a Delaware limited liability company,

its General Partner
	 
	 	 	 	 
	

	 	By:
	 	Holly Energy Partners, L.P.,

a Delaware limited partnership,

its Sole Member
	 
	 	 	 	 
	

	 	By:
	 	HEP Logistics Holdings, L.P.,

a Delaware limited partnership,

its General Partner
	 
	 	 	 	 
	

	 	By:
	 	Holly Logistic Services, L.L.C.,

a Delaware limited liability company,

its General Partner
	 
	 	 	 	 
	

	 	By:	 	 
	 	 	 	 
	

	 	 	 	W. John Glancy,

Vice President, General Counsel and

Secretary






1-11









 






	 	 	 
	THE STATE OF TEXAS

	 	§
	

	 	§
	COUNTY OF DALLAS

	 	§






          THIS INSTRUMENT was acknowledged before me on March ___, 2005 by Sean Murphy, Vice President
of Union Bank of California, N.A., a national banking association, as Administrative Agent, on
behalf of such banking association.



	 	 	 
	

	 	________________________________

Notary Public in and for the State of Texas
	 
	 	 
	______________________

My Commission Expires

	 	________________________________

Printed Name of Notary






	 	 	 
	THE STATE OF TEXAS

	 	§
	

	 	§
	COUNTY OF DALLAS

	 	§






          THIS INSTRUMENT was acknowledged before me on March ___, 2005 by Jeff D. Morris, President and
Chief Executive Officer of Alon USA GP, LLC, a Texas limited liability company, the general partner
of Alon USA, LP, a Texas limited partnership, on behalf of such limited liability company and
limited partnership.



	 	 	 
	

	 	________________________________

Notary Public in and for the State of Texas
	 
	 	 
	_____________________

My Commission Expires

	 	________________________________

Printed Name of Notary






1-12









 






	 	 	 
	THE STATE OF ______

	 	§
	

	 	§
	COUNTY OF ________

	 	§






          THIS INSTRUMENT was acknowledged before me on March ___, 2005 by
______, ______of Credit Suisse
First Boston, a ___, acting through its Cayman Islands Branch, as
Alon Administrative Agent, on behalf of such ______.



	 	 	 
	

	 	_________________________________

Notary Public in and for the State of_____
	 
	 	 
	______________________

My Commission Expires

	 	_________________________________

Printed Name of Notary






	 	 	 
	THE STATE OF ________

	 	§
	

	 	§
	COUNTY OF __________

	 	§






          THIS INSTRUMENT was acknowledged before me on March ___, 2005 by
______, ______of Credit Suisse
First Boston, a ___, acting through its Cayman Islands Branch, as
Alon Administrative Agent, on behalf of such ______.



	 	 	 
	

	 	____________________________________

Notary Public in and for the State of________
	 
	 	 
	_____________________

My Commission Expires

	 	___________________________________

Printed Name of Notary






1-13









 






	 	 	 
	THE STATE OF TEXAS

	 	§
	

	 	§
	COUNTY OF DALLAS

	 	§






          THIS INSTRUMENT was acknowledged before me on March 1, 2005 by W. John Glancy, Vice President,
General Counsel and Secretary of Holly Logistic Services, L.L.C., a Delaware limited liability
company, as General Partner of HEP Logistics Holdings, L.P., a Delaware limited partnership, as
General Partner of Holly Energy Partners, L.P., a Delaware limited partnership, the Sole Member of
HEP Logistics GP, L.L.C., a Delaware limited liability company, as General Partner of Holly Energy
Partners – Operating, L.P., a Delaware limited partnership, the Sole Member of HEP Pipeline GP,
L.L.C., a Delaware limited liability company, as General Partner of HEP Fin-Tex/Trust-River, L.P.,
a Texas limited partnership, on behalf of such entities.



	 	 	 
	

	 	__________________________________

Notary Public in and for the State of Texas
	 
	 	 
	______________________

My Commission Expires

	 	__________________________________

Printed Name of Notary






1-14









 






EXHIBIT A




Property




A-1