Document:

Exhibit

Exhibit 10.3

EXECUTION COPY

OMNIBUS AMENDMENT NO. 2 AND CONSENT
TO
SIXTH AMENDED AND RESTATED CREDIT AGREEMENT
AND
AMENDMENT NO. 3 TO AMENDED AND RESTATED SECURITYAGREEMENT

This OMNIBUS AMENDMENT NO. 2 AND CONSENT to SIXTH AMENDED AND RESTATED CREDIT AGREEMENT and AMENDMENT NO. 3 TO AMENDED AND RESTATED SECURITY AGREEMENT (the “Amendment”), dated as of August 21, 2015, is entered into by and among Tesoro Corporation (the “Borrower”), the Subsidiaries of the Borrower party hereto (the “Subsidiary Grantors” and, together with the Borrower, the “Grantors”), the financial institutions listed on the signature pages hereof (the “Lenders”), and JPMorgan Chase Bank, National Association, as Administrative Agent (the “Agent”), under the below-defined Credit Agreement.  Each capitalized term used herein and not otherwise defined herein shall have the meaning given to it in the below-defined Credit Agreement.

WITNESSETH

WHEREAS, the Borrower, the Lenders, and the Agent are parties to a Sixth Amended and Restated Credit Agreement dated as of January 4, 2013 (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”);

WHEREAS, the Borrower wishes to amend the Credit Agreement in certain respects and the Lenders party hereto and the Agent are willing to amend the Credit Agreement on the terms and conditions set forth herein;

WHEREAS, the Borrower has informed the Agent that, notwithstanding the terms of Section 6.25 of the Credit Agreement as in effect prior to this Amendment, the Borrower has caused funds on deposit in the Collection Accounts to be released to Borrower operating accounts maintained at Lenders other than JPMorgan (collectively, the “Collection Account Transfers”);

WHEREAS, the Borrower has requested that the Lenders party hereto and the Agent consent to the Collection Account Transfers;

WHEREAS, subject to the terms and conditions of this Amendment, the Lenders party hereto and the Agent are willing to consent to the Collection Account Transfers;

WHEREAS, the Grantors and the Agent are parties to an Amended and Restated Security Agreement, dated as of March 16, 2011 (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Security Agreement”); and

WHEREAS, the Grantors wish to amend the Security Agreement in certain respects and the Lenders party hereto and the Agent are willing to amend the Security Agreement on the terms and conditions set forth herein.

ACTIVE 209499242v.12

NOW, THEREFORE, in consideration of the premises set forth above, the terms and conditions contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Borrower, the Subsidiary Grantors, the Agent and the Lenders party hereto hereby agree as follows:

1.    Amendments to  Credit  Agreement.    Effective  as  of  the  date  of  satisfaction of  the conditions precedent set forth in Section 4 below, the Credit Agreement is hereby amended as follows:

(a) Section 1.1 of the Credit Agreement is hereby amended to add the following definitions in their appropriate alphabetical order therein:

“ “JPMorgan Money Market Mutual Fund Interests” means shares in certain money market mutual funds advised by J.P. Morgan Investment Management Inc., an affiliate of JPMorgan, each as reflected on such fund’s shareholder records maintained by Boston Financial Data Services, Inc., as transfer agent on behalf of each such fund.”

“ “Second Amendment Effective Date” means August 21, 2015.”

(b)  The definition of “Perfected Cash Interests” contained in Section 1.1 of the Credit
Agreement is hereby amended to amend and restate such definition in its entirety as follows:

““Perfected Cash Interests” means Dollars or Cash Equivalent Investments on deposit in collection accounts, other accounts or otherwise (including the JPMorgan Money Market Mutual Fund Interests), in each case subject to control agreements in form and substance acceptable to the Agent that grant the Agent first priority perfected security interests in such accounts or investments and the Dollars and Cash Equivalent Investments (including proceeds thereof) on deposit or otherwise maintained or reflected therein or other similar arrangements whereby the bank, financial institution or other agent holding or reflecting such deposits or investments (or the issuer of such investments, as applicable to establish control) have acknowledged the Lien created thereon and the Agent holds a first priority perfected security interest therein.”

(c)  Section 6.25 of the Credit Agreement is hereby amended and restated in its entirety as follows:

“6.25    Collection Account.      The  Borrower  and  its  Subsidiaries  shall  cause  all collections of Receivables constituting Collateral and all proceeds of Collateral to be directly deposited into  collection  accounts  (such  accounts,  “Collection  Accounts”)  maintained  with  JPMorgan  or  an Affiliate thereof or other financial institutions.  Collection Accounts shall, upon the request of the Agent, be subject to account control agreements, in form and substance acceptable to the Agent, which grant the Agent control over and a first-priority perfected security interest in such Collection Accounts, including, without limitation, amounts and other items on deposit therein.  If any collections referred to in the first sentence of this Section 6.25 are received by the Borrower, a Subsidiary, or any other Person, such collections shall be deemed to have been received by the Borrower, such Subsidiary or such other Person in trust for the Agent, and, upon the Borrower’s, such Subsidiary’s, or such other Person’s receipt thereof, the Borrower shall (or shall cause such Subsidiary or other Person to) promptly remit all of such collections, in their original form, for deposit into a Collection Account.  Following the occurrence and during the continuance of a Default, all amounts received by the Agent, all amounts on deposit in the Collection Accounts, and all amounts constituting collections required to be deposited into Collection Accounts shall be the sole property of the Agent for the benefit of the Holders of Secured Obligations and shall be deemed received by the Agent for application to the Secured Obligations pursuant to the terms of this Agreement.   With respect to any Collection Account described in this Section 6.25 not already

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subject to a control agreement on the Second Amendment Effective Date, the Borrower and its Subsidiaries shall have ninety (90) days from the date of the Agent’s request therefor to cause such account to become subject to one of the aforementioned account control agreements.  For the avoidance of doubt, amounts on deposit in any Collection Account and other Cash Equivalent Investments not subject to an account control agreement shall not constitute Perfected Cash Interests and therefore shall not be included in the Borrowing Base.  Notwithstanding the foregoing, or anything to the contrary in Section 2.11.1, (a) the Borrower and its Subsidiaries shall be permitted to transfer amounts on deposit in any Collection Account to any other account or investment constituting a Cash Equivalent Investment (including the JPMorgan Money Market Mutual Fund Interests) so long as after giving effect to such transfer such amounts constitute Perfected Cash Interests and (b) at all times that (i) no Default exists and (ii) Excess Availability equals or exceeds $300,000,000, amounts which are on deposit in Collection Accounts or other accounts or investments referenced in the preceding clause (a) may be released, in a manner mutually satisfactory to the Borrower and the Agent, on a daily basis to the Borrower’s operating accounts maintained with JPMorgan or with any other Lender or otherwise at the direction of the Borrower (and such released amounts shall be automatically released from the Lien created by the Security Agreement and cease to be Collateral without delivery of any instrument or performance of any act by any party, and all rights to such released amounts shall revert to the Borrower or applicable Subsidiary).   In  connection with any release described in  clause (b)  of  the  immediately preceding sentence, the Agent, at the request and sole expense of the Borrower, shall execute and deliver to the Borrower all releases or other documents reasonably necessary or desirable for the release of the Lien on such released amounts.”

2.    Amendments to Security Agreement and Reaffirmation of Security Interest.

(a)    Effective as of the date of satisfaction of the conditions precedent set forth in
Section 4 below, the Security Agreement is hereby amended as follows:

(i)         The definition of “Cash Equivalents” contained in Section 1.3 of the Security Agreement is hereby amended by (i) deleting the word “and” at the end of clause (4), (ii) replacing the period at the end of clause (5) with “; and” and (iii) adding new clause (6) as follows:

“(6)    Cash Equivalent Investments.”

(ii)        The following new definition of “Cash Equivalent Investments” is hereby added to Section 1.3 of the Security Agreement in its appropriate alphabetical order therein:

“Cash  Equivalent  Investments”  shall  have  the  meaning  set  forth  in  the  Credit
Agreement.”

(iii)       Section 4.6 of the Security Agreement is hereby amended and restated in its entirety as follows:

“4.6.      Deposit Accounts and Cash Equivalent Investments.  Each Grantor will, within ninety (90) days of the Agent’s request (and as required pursuant to Section 6.25 of the Credit Agreement), cause each bank or other financial institution in which it maintains (a) a Deposit Account (other than a Deposit Account maintained for collections from retail sales) to enter into a control agreement with the Agent, in form and substance satisfactory to the Agent in order to give the Agent Control of the Deposit Account, (b) other Cash Equivalent Investments to enter into control agreements in form and substance acceptable to the Agent that grant the Agent Control over such investments, or (c) other deposits (general or special, time or demand, provisional or final) to be notified of the security interest granted to the Agent hereunder and cause each such

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bank or other financial institution to acknowledge such notification in writing.  In the case of deposits maintained with Lenders, the terms of such letter shall be subject to the provisions of the Credit Agreement regarding setoffs.”

(b)        For the avoidance of doubt, each Grantor hereby reaffirms the security interest granted under the terms and conditions of the Security Agreement and agrees that such security interest remains in full force and effect and is hereby ratified, reaffirmed and confirmed, and each Grantor hereby pledges, assigns and grants to the Agent, on behalf of and for the ratable benefit of the Holders of Secured Obligations and (to the extent specifically provided for in the Security Agreement) their Affiliates, a security interest in all of such Grantor’s right, title and interest, whether now owned or hereafter acquired, in and to the Collateral (as defined in the Security Agreement as amended hereby and including Cash Equivalent Investments) to secure the prompt and complete payment and performance of (i) the Secured Obligations in the case of the Borrower and (ii) the “Guaranteed Obligations” (as defined in the Guaranty) in the case of each other Grantor.

3.          Consent.   Subject to the satisfaction of the conditions precedent set forth in Section 4 below, and notwithstanding the terms of Section 6.25 of the Credit Agreement as in effect prior to the effectiveness of this Amendment, the Lenders party hereto and the Agent hereby consent to the Collection Account Transfers and agree that the Collection Account Transfers are deemed to have been, and any subsequent actions taken with respect to amounts on deposit in Collection Accounts shall hereafter be, subject to Section 6.25 of the Credit Agreement as amended pursuant to this Amendment.

4.          Conditions of Effectiveness.   This Amendment shall become effective and be deemed effective as of the date hereof, if, and only if:

(a) the Agent shall have received executed copies of this Amendment from the Borrower, the Subsidiary Grantors and all of the Lenders required to execute and deliver this Amendment pursuant to the terms of the Credit Agreement;

(b) the Agent shall have received those agreements, documents, instruments and other deliverables appearing in Annex A hereto; and

(c) the Borrower shall have paid all fees and expenses of the Agent (including, to the extent invoiced, attorneys’ fees and expenses) in connection with this Amendment.

5.          Representations and Warranties of the Borrower and Subsidiary Grantors. The Borrower and each Subsidiary Grantor hereby represents and warrants as follows:

(a)        The Credit Agreement and Security Agreement, each as previously executed and amended and as amended hereby constitutes the legal, valid and binding obligation of the Borrower and each Subsidiary Grantor party thereto, and is enforceable against the Borrower and each Subsidiary Grantor party thereto in accordance with its terms, except as enforceability may be limited by (i) bankruptcy, insolvency, fraudulent conveyances, reorganization or similar laws relating to or affecting the enforcement of creditors’ rights generally; (ii) general equitable principles (whether considered in a proceeding in equity or at law); and (iii) requirements of reasonableness, good faith and fair dealing.

(b)       (i) The representations and warranties contained in Article V of the Credit Agreement and Article 3 of the Security Agreement are true and correct as of the date hereof, after giving effect to this Amendment, except (x) with respect to Sections 5.5 and 5.7 of the Credit Agreement, the representations and warranties set forth in such Sections shall have been true and correct on and as of the date of the most recent Form 10-K or Form 10-Q filing, as applicable, made by the Borrower with the

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U.S. Securities and Exchange Commission, and (y) with respect to any other representation and warranty set forth in Article V of the Credit Agreement and Article 3 of the Security Agreement, to the extent such representation or warranty is stated to relate solely to an earlier date, such representation or warranty shall have been true and correct on and as of such earlier date and (ii) after giving effect to this Amendment, no event shall have occurred and then be continuing which constitutes a Default or an Unmatured Default.

(c)       The modifications contemplated by this Amendment are permitted under the terms of indentures and other agreements referenced in Section 9.17 of the Credit Agreement that remain in effect as of the date hereof.

(d)        The Borrower and each Subsidiary Grantor has the power and authority and legal right to execute and deliver this Amendment and to perform its obligations hereunder. The execution and delivery by the Borrower and each Subsidiary Grantor of this Amendment and the performance of its obligations hereunder have been duly authorized by proper proceedings and the Amendment has been duly executed and delivered by the Borrower and each Subsidiary Grantor. No order, consent, adjudication, approval, license, authorization, or validation of, or exemption by, any governmental or public body or authority, or any subdivision thereof, which has not been obtained by the Borrower or any Subsidiary Grantor, is required to be obtained by the Borrower or any Subsidiary Grantor in connection with the execution and delivery of the Amendment except where failure to obtain the same would not reasonably be expected to have a Material Adverse Effect.

6.    Effect on the Credit Agreement and Security Agreement.

(a)        Upon the effectiveness of this Amendment, on and after the date hereof, each reference  in  the  Credit  Agreement    or  the  Security  Agreement  to  “this  Agreement,” “hereunder,” “hereof,” “herein” or words of like import shall mean and be a reference to the Credit Agreement or Security Agreement, as applicable, as amended and modified hereby.

(b)        Except as specifically amended and modified above, the Credit Agreement, the Security Agreement and all other documents, instruments and agreements executed and/or delivered in connection therewith shall remain in full force and effect, and are hereby ratified and confirmed.

(c)        The  execution,  delivery  and  effectiveness of  this  Amendment  shall  neither, except as expressly provided herein, operate as a waiver of any right, power or remedy of the Lenders or the Agent, nor constitute a waiver of any provision of the Credit Agreement, the Security Agreement or any other documents, instruments and agreements executed and/or delivered in connection therewith.

(d)    For the avoidance of doubt, the parties hereto acknowledge and agree that this
Amendment constitutes a Loan Document as defined under the Credit Agreement.

7.          Costs  and  Expenses.    The  Borrower  agrees  to  pay  all  reasonable  costs,  fees  and out-of-pocket expenses (including attorneys’ fees and expenses charged to the Agent) incurred by the Agent and the Lenders in connection with the preparation, arrangement, execution and enforcement of this Amendment.

8.        Governing Law.   THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

9.          Headings.  Section headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment for any other purpose.

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10.        Counterparts.  This Amendment may be executed by one or more of the parties to the Amendment on any number of separate counterparts and all of said counterparts taken together shall be deemed to constitute one and the same instrument.  Delivery of an executed counterpart of a signature page of this Amendment by facsimile shall be effective as delivery of a manually executed counterpart of this Amendment.

11.        No Strict Construction. The parties hereto have participated jointly in the negotiation and drafting of this Amendment.  In the event an ambiguity or question of intent or interpretation arises, this Amendment shall be construed as if drafted jointly by the parties hereto and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Amendment.

12.        Reaffirmation. Each of the undersigned Subsidiary Grantors and each other Subsidiary Guarantor signatory hereto hereby acknowledges receipt of a copy of this Amendment, and the Borrower and each Subsidiary Grantor and Subsidiary Guarantor affirms the terms and conditions of each Loan Document executed by it, including, without limitation, the Security Agreement and each Guaranty to which it is a party, and acknowledges and agrees that each such Loan Document executed by it in connection with the Credit Agreement remains in full force and effect and is hereby reaffirmed, ratified and confirmed.

The remainder of this page is intentionally blank.

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IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and year first above written.

TESORO CORPORATION,
as the Borrower

By:  \s\ Brad S. Lakhia            
Name:  Brad S. Lakhia
Title:  Vice President and Treasurer

SUBSIDIARY GRANTORS:

TESORO WASATCH, LLC
TESORO COMPANIES, INC.
TESORO ALASKA COMPANY LLC (formerly known as
Tesoro Alaska Company)
TESORO REFINING & MARKETING COMPANY LLC
(formerly known as Tesoro Refining and Marketing Company)
TESORO WEST COAST COMPANY, LLC
TESORO SIERRA PROPERTIES, LLC
TESORO NORTHSTORE COMPANY
TESORO SOUTH COAST COMPANY, LLC
TESORO TRADING COMPANY
TESORO ENVIRONMENTAL RESOURCES COMPANY
TESORO AVIATION COMPANY
TESORO MARITIME COMPANY
TESORO FAR EAST MARITIME COMPANY
GOLD STAR MARITIME COMPANY
CARSON COGENERATION COMPANY
TESORO INSURANCE HOLDING COMPANY
TRANS-FORELAND PIPELINE COMPANY LLC
TESORO RENEWABLES COMPANY LLC
UINTA EXPRESS PIPELINE COMPANY LLC
TESORO SOCAL COGEN COMPANY LLC

By:  \s\ Brad S. Lakhia        
Name:  Brad S. Lakhia
Title:  Vice President and Treasurer

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

SUBSIDIARY GRANTORS:

TREASURE FRANCHISE COMPANY LLC

By:  \s\ ROBERT R. MOTLEY        
Name: Robert R.Motley
Title: President and Manager

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

Solely with respect to Section 12 hereof:

TESORO CANADA SUPPLY & DISTRIBUTION LTD.
TESORO PANAMA COMPANY, S.A.

By:  \s\ BRAD S. LAKHIA        
Name: Brad S. Lakhia
Title: Vice President and Treasurer

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION,
individually, as the Non-Ratable Lender and as Administrative
Agent

By:  \s\ J. DEVIN MOCK        
Name: J. Devin Mock
Title: Authorized Officer

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

THE ROYAL BANK OF SCOTLAND PLC,
as a Lender

By:  \s\ SIMON MOCKFORD        
Name: Simon Mockford
Title:  Managing Director

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

WELLS FARGO BANK, N.A.,
as a Lender

By:  \s\ MATT HARBOUR        
Name: Matt Harbour
Title:  Duly Authorized Signer

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

BANK OF AMERICA, N.A.,
as a Lender

By:  \s\ BRANDON WATKINS        
Name: Brandon Watkins
Title:  Senior Vice President

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

BARCLAYS BANK PLC,
as a Lender

By:  \s\ LUKE SYME            
Name: Luke Syme
Title:  Assistant Vice President

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

THE BANK OF TOKYO MITSUIBISHI UFJ, LTD.,
as a Lender

By:  \s\ TODD VAUBEL        
Name: Todd Vaubel
Title:  Vice President

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

CITIBANK, N.A.,
as a Lender

By:  \s\ BRENDAN MACKAY        
Name: Brendan Mackay
Title:  Vice President and Director

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

CREDIT AGRICOLE CORPORATE & INVESTMENT BANK,
as a Lender

By:  \s\ DARRELL STANLEY        
Name: Darrell Stanley
Title:  Managing Director

By:  \s\ MICHAEL WILLIS        
Name: Michael Willis
Title:  Managing Director

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

MIZUHO BANK, LTD.,
as a Lender

By:  \s\ DONNA DEMAGISTRIS        
Name: Donna DeMagistris
Title:  Authorized Signatory

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

NATIXIS, NEW YORK BRANCH
as a Lender

By:  \s\ JARRETT PRICE        
Name: Jarrett Price
Title:  Director

By:  \s\ CARLOS QUINTEROS    
Name: Carlos Quinteros
Title:  Managing Director

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

BANCO BILBAO VIZCAYA ARGENTARIA S.A.,
NEW YORK BRANCH, as a Lender

By:  \s\ NURYS MALEKI        
Name: Nurys Maleki
Title:  Global Trade Finance

By:  \s\ LUCA SACCHI        
Name: Luca Sacchi
Title:  Managing Director

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

BNP PARIBAS,
as a Lender

By:  \s\ NICOLAS ANBERREE        
Name: Nicolas Anberree
Title:  Vice President

By:  \s\ CLAUDIA ZARATE            
Name: Claudia Zarate
Title:  Director

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

DEUTSCHE BANK AG NEW YORK BRANCH,
as a Lender

By:  \s\ PETER CUCCHIARA        
Name: Peter Cucchiara
Title:  Vice President

By:  \s\ MICHAEL SHANNON            
Name: Michael Shannon
Title:  Vice President

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

REGIONS BANK,
as a Lender

By:  \s\ GREGORY GARBUZ        
Name: Gregory Garbuz
Title:  Vice President

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

SUNTRUST BANK,
as a Lender

By:  \s\ DAN CLUBB        
Name: Dan Clubb 
Title:  Director

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

UBS AG, STAMFORD BRANCH,
as a Lender

By:  \s\ DARLENE ARIAS        
Name: Darlene Arias
Title:  Director

By:  \s\ CRAIG PEARSON        
Name: Craig Pearson
Title:  Associate Director

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

THE BANK OF NOVA SCOTIA,
as a Lender

By:  \s\ JOHN FRAZELL    
Name: John Frazell
Title:  Director

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

ROYAL BANK OF CANADA,
as a Lender

By:  \s\ JASON YORK        
Name: Jason York
Title:  Authorized Signatory

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

CIBC INC.,
as a Lender

By:  \s\ RICHARD ANTL        
Name: Richard Antl
Title:  Authorized Signatory

By:  \s\ TRUDY NELSON        
Name: Trudy Nelson
Title:  Authorized Signatory

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

FIFTH THIRD BANK,
as a Lender

By:  \s\ LARRY HAYES        
Name: Larry Hayes
Title:  Vice President

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

SUMITOMO MITSUI BANKING CORPORATION,
as a Lender

By:  \s\ JAMES D. WEINSTEIN        
Name: James D. Weinstein
Title:  Managing Director

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

RB INTERNATIONAL FINANCE (USA), LLC,
as a Lender

By:  \s\ JOHN A. VALISKA            
Name: John A. Valiska
Title:  First Vice President

By:  \s\ STEVEN VANSTEENBERGEN    
Name: Steven VanSteenbergen
Title:  Vice President

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

PNC BANK, NATIONAL ASSOCIATION,
as a Lender

By:  \s\ ART BOYLE            
Name: Art Boyle
Title:  Officer

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

CAPITAL ONE, NATIONAL ASSOCIATION,
as a Lender

By:  \s\ NANCY MAK        
Name: Nancy Mak
Title:  Senior Vice President

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

HSBC BANK USA, NATIONAL ASSOCIATION,
as a Lender

By:  \s\ WADIE C. HABIBY        
Name: Wadie C. Habiby
Title:  Vice President

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

U.S. BANK NATIONAL ASSOCIATION,
as a Lender

By:  \s\ ROD SWENSON        
Name: Rod Swenson
Title:  Vice President

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

AMEGY BANK NATIONAL ASSOCIATION,
as a Lender

By:  \s\ MARK A. SERICE        
Name: Mark A. Serice
Title:  Senior Vice President

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

CITY NATIONAL BANK, a national banking association,
as a Lender

By:  \s\ MIA BOLIN            
Name: Mia Bolin
Title:  Vice President

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

FROST BANK,
as a Lender

By:  \s\ SARAH CERNOSEK        
Name: Sarah Cernosek
Title:  Senior Vice President

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

COMERICA BANK,
as a Lender

By:  \s\ L. J. PERENYL        
Name: L. J. Perenyl
Title:  Vice President

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH,
as a Lender

By:  \s\ MIKHAIL FAYBUSOVICH        
Name: Mikhail Faybusovich
Title:  Authorized Signatory

By:  \s\ GREGORY FANTERI        
Name: Gregory Fanteri
Title:  Authorized Signatory

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

AMALGAMATED BANK,
as a Lender

By:  \s\ MICHAEL L. LAMANES        
Name: Michael L. LaManes
Title:  First Vice President

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

SIEMENS FINANCIAL SERVICES, INC.,
as a Lender

By:  \s\ JEFFREY B. IERVESE        
Name: Jeffrey B. Iervese
Title:  Vice President

By:  \s\ JOHN FINORE        
Name: John Finore
Title:  Vice President

SIGNATURE PAGE TO AMENDMENT NO.2 AND CONSENT
TO SIXTH AMENDED AND RESTATED CREDIT AGREEMENT AND
AMENDMENT NO. 3 TO
AMENDED AND RESTATED SECURITY AGREEMENT

ANNEX A
TO
OMNIBUS AMENDMENT

List of Closing Deliverables1 

		
	1.
	Omnibus Amendment No. 2 to Sixth Amended and Restated Credit Agreement and Amendment No. 3 to Amended and Restated Security Agreement (the “Amendment”) by and among the Borrower, the Subsidiary Grantors, the Lenders signatory thereto and the Agent.

		
	2.
	Evidence that the credit facility evidenced by that certain Term Loan Credit Agreement, dated as of January 28, 2013, among the Borrower, JPMorgan Chase Bank, National Association, as administrative agent and collateral agent, and the lenders party thereto, has been terminated and cancelled, and that all indebtedness thereunder shall have been fully repaid and any and all liens thereunder shall have been terminated.

		
	3.
	UCC-1 Financing Statements naming each Credit Party as debtor and the Agent as secured party filed in the appropriate offices in the jurisdictions as described on Schedule I hereto.

		
	4.
	Control Agreement with respect to the JPMorgan Money Market Mutual Fund Interests.

		
	5.
	Opinion of Simpson Thacher & Bartlett LLP, special outside counsel to the Borrower and theSubsidiary Grantors addressed to the Agent and the Lenders.

		
	6.
	Certificate of the Secretary or an Assistant Secretary of each Grantor certifying (i) that there have been no changes in the Articles or Certificate of Incorporation, Certificate of Formation or other analogous charter document of such Credit Party,  either as attached thereto and as certified  as  of  a  recent  date  by  the  Secretary of  State  (or  the  equivalent thereof)  of  its jurisdiction of organization since the date of the certification thereof by such Secretary of State (or equivalent thereof) or as previously certified to the Agent as of a prior date pursuant to documentation delivered in connection with the closing of the Credit Agreement, (ii) that there has been no change to the By-Laws, Limited Liability Company Agreement, Partnership Agreement or other analogous organizational document of such Grantor as previously certified to the Agent as of a prior date pursuant to documentation delivered in connection with the closing of the Credit Agreement, (iii) resolutions of the Board of Directors, Board of Managers or other analogous governing body of such Grantor authorizing the execution, delivery and performance  of  the  Amendment  and  the  Credit  Agreement  and  Security  Agreement  as amended thereby, and (iv) the names and true signatures of the incumbent officers of such Grantor authorized to sign the Amendment and, in the case of the Borrower, authorized to request a Borrowing and the issuance, amendment, renewal or extension of a Letter of Credit under the Credit Agreement.

___________________________
1 Items appearing in bold and italics shall be prepared and/or provided by the Borrower and/or Borrower’s counsel.

Schedule I

UCC-1 Financing Statements

	
			
	Debtor
	Secured Party
	Filing Jurisdiction

	Tesoro
Corporation
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Carson
Cogeneration
Company
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Gold Star
Maritime
Company
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Tesoro Alaska
Company LLC
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Tesoro Aviation
Company
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Tesoro
Companies, Inc.
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Tesoro
Environmental Resources Company
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Tesoro Far East
Maritime
Company
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Tesoro Insurance
Holding Company
	JPMorgan Chase
Bank, National
Association, as
	Secretary of State of
Delaware

	
			
	 
	Agent
	 

	Tesoro Maritime
Company
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Tesoro Northstore
Company
	JPMorgan Chase
Bank, National Association, as Agent
	Department of
Natural Resources of
Alaska

	Tesoro Refining & Marketing
Company LLC
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Tesoro
Renewables
Company LLC
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Tesoro Sierra
Properties, LLC
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Tesoro SoCal
Cogen Company
LLC
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Tesoro South
Coast Company, LLC
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Tesoro Trading
Company
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Tesoro Wasatch,
LLC
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Tesoro West Coast
Company, LLC
	JPMorgan Chase
Bank, National
Association, as
	Secretary of State of
Delaware

	
			
	 
	Agent
	 

	Trans-Foreland
Pipeline Company
LLC
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Treasure Franchise
Company LLC
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
Delaware

	Uinta Express
Pipeline Company
LLC
	JPMorgan Chase
Bank, National Association, as Agent
	Secretary of State of
DelawareExhibit

Exhibit 10.4

TESORO CORPORATION

EXECUTIVE DEFERRED COMPENSATION PLAN

ARTICLE I
GENERAL PROVISIONS

1.1     Establishment and Purpose.

WHEREAS, Tesoro Corporation (the "Company") previously established the Tesoro Corporation Executive Deferred Compensation Plan (the "Plan"), as amended, primarily for the purpose of providing benefits for a select group of management and highly compensated employees of the Company and its Subsidiaries so as to provide benefits comparable to those not provided under the Tesoro Corporation Thrift Plan due to salary and deferral limitations imposed under the Code;

WHEREAS, the Plan is intended to qualify as a "top hat" plan under Sections 201(2), 301(a)(3) and 401(a)(l) of ERISA; and

WHEREAS, the Company previously amended and restated the Plan, effective January 1, 2009, to comply with Regulations under Section 409A of the Code and to clarify certain provisions of the Plan relating to Supplemental Discretionary Awards;

WHEREAS, the Company desires to amend and restate the Plan to incorporate Amendments No.1-4 and to effectuate certain design changes, effective for contributions made to the Plan on account of a Participant’s service on or after January 1, 2016;

WHEREAS, all contributions made to the Plan on account of a Participant’s service prior to January 1, 2016 shall remain subject to the Plan terms prior to this amended and restated Plan;

NOW, THEREFORE, the Company adopts this amended and restated Tesoro Corporation Executive Deferred Compensation Plan, effective January 1, 2016, as follows:

1.2     Definitions.

"Affiliate" means each entity that would be considered a single employer with the Company under Section 414(b) or Section 414(c) of the Code, except that the phrase "at least 50%" shall be substituted for the phrase "at least 80%" as used therein.

"Aggregated Plan" means all agreements, methods, programs and other arrangements that are aggregated with this Plan under Section 1.409A-1(c) of the Regulations.

"Beneficiary" means the person or persons designated by a Participant as his beneficiary hereunder in accordance with the provisions of Article V.

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"Board" means the Board of Directors of the Company.

"Bonus Compensation" means, as determined in the sole discretion of the Committee, such annual bonus or other bonus paid to a Participant including, but not limited to, executive bonus and long-term incentive bonus, but excluding special compensation, bonuses paid because of service overseas, expense allowances, all other extraordinary compensation, and, except as permitted with the prior written consent of the Committee, excluding Sign-On Bonus and Retention Bonus. For the avoidance of doubt, the Committee shall have the sole discretion to determine at any time which types of Bonus Compensation are deferrable under the Plan.

"Chief Executive Officer" means the Chief Executive Officer of the Company.

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

"Committee" means the Employee Benefits Committee appointed by the Compensation Committee of the Board, or such other committee designated by the Compensation Committee of the Board to discharge the duties of the Committee hereunder.

"Company" means Tesoro Corporation, a Delaware corporation, or any successor thereto.

"Company Matching Contribution" means the employer matching contributions allocated to the Participant's account under the Thrift Plan for the Plan Year.

"Compensation" shall, unless otherwise determined by the Committee, for purposes of Sections 2.1 and 2.2 of the Plan, have the meaning assigned thereto in the Thrift Plan (determined without regard to any limits imposed on Compensation by the Code, but including amounts voluntarily deferred under the terms of this Plan and any 401(k) deferrals under the Thrift Plan) and shall, as applicable, include Bonus Compensation.

"Corporate Change in Control" means (i) there shall be consummated (A) any consolidation or merger of Company in which Company is not the continuing or surviving corporation or pursuant to which shares of Company's Common Stock would be converted into cash, securities or other property, other than a merger of Company where a majority of the board of directors of the surviving corporation are, and for a one-year period after the merger continue to be, persons who were directors of Company immediately prior to the merger or were elected as directors, or nominated for election as director, by a vote of at least two-thirds of the directors then still in office who were directors of Company immediately prior to the merger, or (B) any sale, lease, exchange or transfer (in one transaction or a series of related transactions) of all or substantially all of the assets of Company, or (ii) the shareholders of Company shall approve any plan or proposal for the liquidation or dissolution of Company, or (iii) (A) any "person" (as such term is used in Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934), other than Company or a Subsidiary or any employee benefit plan sponsored by Company or a Subsidiary, shall become the beneficial owner (within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934) of securities of Company representing 35 percent or more of the combined voting power of Company's then outstanding securities ordinarily (and apart from rights accruing in special 

2

circumstances) having the right to vote in the election of directors, as a result of a tender or exchange offer, open market purchases, privately negotiated purchases or otherwise, and (B) at any time during a period of one-year thereafter, individuals who immediately prior to the beginning of such period constituted the Board shall cease for any reason to constitute at least a majority thereof, unless election or the nomination by the Board for election by Company's shareholders of each new director during such period was approved by a vote of at least two-thirds of the directors then still in office who were directors at the beginning of such period.

"Deferral Account" means the bookkeeping account(s) established on behalf of a Participant to track the Participant's supplemental benefits as described in Article II hereof. A Deferral Account can refer to either a Termination Account or Specified Date Account as defined herein.

"Deferral Election" means an election by a Participant to defer Compensation in accordance with the provisions of Section 2.1 of the Plan, including an election as to the Distribution Date and Distribution Option.

"Deferrals" shall have the meaning ascribed thereto in Section 2.1(b) hereof.
    
"Disability" means disability as determined under the Retirement Plan.
    
"Disability Date" means the date on which a Participant's Separation from Service due to Disability occurs.
    
"Distribution Date" means the date on which distribution of the applicable portion of a Participant's Deferral Account (other than the portion, if any, of such Deferral Account that is attributable to Supplemental Discretionary Awards) is to commence. Distribution Dates are determined according to each Participant's Deferral Elections for each Deferral Account or as otherwise provided under the terms of the Plan.
    
"Distribution Option" means the form in which distribution of the applicable portion of a Participant's Deferral Account (other than the portion, if any, of such Participant's Deferral Account that is attributable to Supplemental Discretionary Awards) is to be made. Distribution Options are determined according to each Participant's Deferral Elections for each Plan Year or as otherwise provided under the terms of the Plan.

"Earnings" shall have the meaning ascribed thereto in Section 2.4(b) of the Plan.

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

“409A Change in Control” means any of the following events: (i) a change in the ownership of the Company, (ii) a change in the effective control of the Company, or (iii) a change in the ownership of a substantial portion of the assets of the Company.

3

For purposes of this definition, a change in the ownership of the Company occurs on the date on which any one person, or more than one person acting as a group, acquires ownership of stock of the Company that, together with stock held by such person or group constitutes more than 50% of the total fair market value or total voting power of the stock of the Company. A change in the effective control of the Company occurs on the date on which either: (i) a person, or more than one person acting as a group, acquires ownership of stock of the Company possessing 30% or more of the total voting power of the stock of the Company, taking into account all such stock acquired during the 12-month period ending on the date of the most recent acquisition, or (ii) a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board prior to the date of the appointment or election, but only if no other corporation is a majority shareholder of the Company. A change in the ownership of a substantial portion of assets occurs on the date on which any one person, or more than one person acting as a group, other than a person or group of persons that is related to the Company, acquires assets from the Company that have a total gross fair market value equal to or more than 40% of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions, taking into account all such assets acquired during the 12-month period ending on the date of the most recent acquisition.

An event constitutes a 409A Change in Control with respect to a Participant only if the Participant performs services for the Company that has experienced the 409A Change in Control, or the Participant’s relationship to the affected Company otherwise satisfies the requirements of Treasury Regulation Section 1.409A-3(i)(5)(ii). The determination as to the occurrence of a 409A Change in Control shall be based on objective facts and in accordance with the requirements of Section 409A of the Code.

"Insolvency" means, with respect to the Company: (1) an adjudication of bankruptcy; (2) an assignment for the benefit of creditors of or by the Company; (3) a material part or all of the property of the Company becomes subject to the control and direction of a receiver, which receivership is not dismissed within sixty (60) days of such receiver's appointment; or (4) the filing by the Company of a petition for relief under any federal or other bankruptcy or other insolvency law or for an arrangement with creditors.

"Participant" means any employee who has satisfied the eligibility requirements set forth in Section 1.4 of the Plan and has a credit to a Deferral Account or has completed a Deferral Election.

"Performance-Based Compensation" means the total amounts payable to a Participant as remuneration based upon the Participant's performance of services for the Company over a period of not less than twelve (12) months, the payment of which or the amount of which is contingent on the satisfaction of established organizational or individual performance criteria, and that otherwise meets the definition of "performance-based compensation", as that term is defined in Section 1.409A-2(a)(7) of the Regulations. For these purposes, Performance-Based Compensation shall be based upon criteria established no later than 90 days following commencement of the applicable performance period.

4

"Person" means any individual, corporation, joint venture, association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.

"Plan Year" means the twelve-month period beginning each January 1.

"Regulations" means the Treasury Regulations promulgated under the Code.

“Retention Bonus” means a cash-based award outside of an employee's regular compensation that is offered as an incentive to keep such employee on the job during a particularly important business cycle (such as a merger or acquisition).

"Retirement Plan" means the Tesoro Corporation Retirement Plan, as amended.

"Separation from Service" means a reasonably anticipated permanent reduction in the level of bona fide services performed by the Participant for the Company and its Affiliates to 20% or less of the average level of bona fide services performed by the Participant for the Company and its Affiliates (whether as an employee or an independent contractor) in the immediately preceding thirty-six (36) months (or the full period of service to the Company and its Affiliates if the Participant has been providing services to the Company and its Affiliates for fewer than thirty-six (36) months). The determination of whether a Separation from Service has occurred shall be made by the Committee in accordance with the provisions of Section 409A of the Code and the Regulations promulgated thereunder.

“Sign-On Bonus” means a cash-based award that is payable to an eligible individual pursuant to the terms and conditions of such individual’s offer of employment to induce him or her to become an employee of the Company, or any similar item of compensation.

“Specified Date Account” means a Deferral Account established by the Committee to record the amounts payable to a Participant at a future date as specified in such Participant’s Deferral Election or, as applicable, pursuant to a Supplemental Discretionary Award. Unless otherwise permitted by the Committee, a Participant may maintain no more than five Specified Date Accounts. A Specified Date Account may be identified herein and in enrollment materials as an “In-Service Account”, “Fixed Date Account” or such other name as established by the Committee without affecting the meaning thereof.

"Subsidiary" means any entity in which the Company owns or otherwise controls, directly or indirectly, stock or other ownership interests having the voting power to elect a majority of the board of directors, or other governing group having functions similar to a board of directors, as determined by the Committee.

"Supplemental Discretionary Award" means a discretionary amount, if any, credited to a Participant's Deferral Account pursuant to Section 2.2(b).

5

“Supplemental Discretionary Profit Sharing Award” means a discretionary amount, if any, credited to a Participant’s Deferral Account pursuant to Section 2.2(c).

"Supplemental Match" means an amount credited to the Participant's Deferral Account pursuant to Section 2.2(a).

“Termination Account” means a Deferral Account established by the Committee to record the amounts payable to a Participant upon Separation from Service. Unless a Specified Date Account has been established by or on behalf of a Participant, all Deferrals and Company contributions shall be allocated to a Termination Account on behalf of the Participant.

"Thrift Plan" means the Tesoro Corporation Thrift Plan, as amended.

"Unforeseeable Emergency" means a severe financial hardship to the Participant resulting from an illness or accident of the Participant, the Participant's spouse, or a dependent (as determined under Section 152 of the Code, but without regard to subsections (b)(1), (b)(2) and (d)(1)(B) of Section 152) of the Participant, loss of the Participant's property due to casualty (including the need to rebuild a home following damage to a home not otherwise covered by insurance), or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant.

1.3     Administration.

(a) The Committee shall administer the Plan and have sole and absolute authority and discretion to decide all matters relating to the administration of the Plan, including, without limitation, determining the rights and status of Participants or their Beneficiaries under the Plan. The Committee is authorized to interpret the Plan, to adopt administrative rules, regulations, and guidelines for the Plan, and may correct any defect, supply any omission or reconcile any inconsistency or conflict in the Plan. The Committee's determinations under the Plan need not be uniform among all Participants, or classes or categories of Participants, and may be applied to such Participants, or classes or categories of Participants, as the Committee, in its sole and absolute discretion, considers necessary, appropriate or desirable. All determinations by the Committee shall be final, conclusive and binding on the Company, the Participant and any and all interested parties.

(b) The Committee may delegate such of its powers and authority under the Plan to the Company's officers or such other person(s) as it deems necessary or appropriate. In the event of such delegation, all references to the Committee in this Plan shall be deemed references to such officers or such other person(s) as it relates to those aspects of the Plan that have been delegated.

(c) Any action taken by the Committee with respect to the rights or benefits under the Plan of any Participant shall be subject to correction by the Committee as to payments not yet made to such person, and acceptance of any deferred compensation benefits under the Plan constitutes acceptance of and agreement to the Committee's or the Company's 

6

making any appropriate adjustments in future payments to such person (or to recover from such person) any excess payment or underpayment previously made to him.

(d) Notwithstanding any provision of the Plan to the contrary, if any benefit provided under this Plan is subject to the provisions of Section 409A of the Code and the Regulations issued thereunder, the provisions of the Plan shall be administered, interpreted and construed in a manner necessary to comply with Section 409A and the Regulations issued thereunder (or disregarded to the extent such provision cannot be so administered, interpreted or construed).

1.4     Eligibility and Participation.

(a) Participation in the Plan is limited to those individuals who are eligible to participate in the Thrift Plan and are within the category of a select group of management and highly compensated employees as referred to in Sections 201(2), 301(a)(3) and 401(a)(l) of ERISA, and who are within those classifications of officers and key management employees of the Company and its Subsidiaries as determined in the sole discretion of the Compensation Committee of the Board for each Plan Year. Plan eligibility for new participants shall commence as of the first day of the Plan Year or the first day of the 7th month of the Plan Year (each, a "semi-annual entry date") as determined by the Compensation Committee of the Board. Employees hired, promoted or reclassified to a category of officer and key management employees of the Company and/or its Subsidiaries eligible for participation shall become eligible as of the semiannual entry date determined by the Compensation Committee of the Board. A newly eligible Participant shall make his or her Deferral Elections within the designated time periods as set forth in Section 2.1 hereof.

(b) A Participant shall cease to be a Participant upon receiving payment for the full amount of benefits to which the Participant is entitled under the Plan. A Participant who becomes ineligible to participate based on eligibility status as determined pursuant to Section 1.4(a) of this Plan shall become an ineligible Participant at the time determined by the Committee. Once a Participant is no longer eligible to actively participate in the Plan, he shall not be entitled to defer Compensation pursuant to Section 2.1 or receive a Supplemental Match, Supplemental Discretionary Profit Sharing Award or Supplemental Discretionary Award (except to the extent otherwise provided in an Award Agreement) under Section 2.2.

ARTICLE II
SUPPLEMENTAL BENEFITS

2.1     Supplemental Deferral Elections.

(a) Each Participant shall be eligible to elect to defer Compensation under the Plan with respect to a Plan Year in accordance with the terms of the Plan and the rules and procedures established by the Committee. Deferral Elections under the Plan are entirely voluntary and, with respect to the Plan Year to which they relate, following the end of the 

7

election period established under Section 2.1(b), are irrevocable, except as provided in Sections 2.1(e) and 3.5 hereof.

(b) A Participant may make a Deferral Election by filing a written or electronic election with the Committee or its designee directing the Company to reduce the Participant's Compensation, including as applicable, Bonus Compensation and to credit the amount of any such reduction (the "Deferrals") to the Deferral Account established and maintained for such Participant pursuant to Section 2.4 of the Plan. Each Deferral Election shall specify whether to allocate Deferrals to a Termination Account or one or more Specified Date Accounts (and if no such designation is made, Deferrals shall automatically be allocated to the Termination Account). Each Deferral Election shall be partitioned for each available deferral source (e.g. salary and each type of bonus). The Committee may, in its sole discretion, establish a minimum deferral period for the establishment of a Specified Date Account (e.g. the third Plan Year following the year that the Deferral is allocated to such account). Deferral Elections hereunder shall be made in accordance with the terms of the Plan and the rules established by the Committee and, except as provided below, must be filed not later than December 31 of the calendar year preceding the Plan Year to which the election relates (or at such earlier times as may be established by the Committee) (such period established by the Committee on an annual basis shall be the “Annual Enrollment Period”). With regard to Performance- Based Compensation, such Deferral Elections shall initially be permitted to be made in the Annual Enrollment Period preceding the Plan Year(s) to which such election relates and subsequently may be changed, elected or withdrawn on or before June 30 of the calendar year that coincides with the applicable performance period in accordance with Section 409A of the Code and the Regulations. A Participant may revoke or modify such election up until the end of the election period established by the Committee under this Section 2.1(b). Notwithstanding the preceding, for the first Plan Year in which a Participant is eligible to participate in the Plan, a Participant's initial Deferral Election may be made within thirty (30) days after the date the Participant becomes eligible to participate in the Plan and shall apply only to Compensation and Bonus Compensation paid for services to be performed after the election for such Plan Year in accordance with Section 409A of the Code. Unless otherwise determined by the Committee, a Deferral Election must be filed each Plan Year, and will not carry over from Plan Year to Plan Year.

(c) Deferrals shall be credited to each Participant's Deferral Account at such time or times as determined by the Committee; provided, however, that Deferrals shall be credited to each Participant's Deferral Account not later than thirty (30) days after the date on which such Compensation would have otherwise been paid, without regard to whether or not the Participant has reached the limit on 401(k) deferrals under the Thrift Plan. Deferrals shall be deemed to be invested in accordance with a Participant's investment designations as permitted under Section 2.4(b).

(d) Unless otherwise determined by the Committee, a Participant may elect to defer up to 50% of Compensation (exclusive of Bonus Compensation) and up to 100% of Bonus Compensation payable to the Participant. Notwithstanding the foregoing, the Committee may implement additional conditions with respect to a Participant’s Deferral Election, 

8

including but not limited to applying deferral percentages only to amounts in excess of certain thresholds.

(e) Notwithstanding the foregoing and unless otherwise determined by the Committee, a Deferral Election shall automatically terminate on the earliest to occur of: (1) the end of the Plan Year to which the Deferral Election applies; (2) the termination of a Participant's employment for any reason; (3) the Committee's determination that the Participant is no longer eligible to participate in the Plan; or (4) the termination or discontinuance of the Plan.

(f) Each Participant shall at all times be vested in the portion of his Deferral Account attributable to Deferrals, including Earnings thereon.

		
	2.2 
	Supplemental Match, Discretionary Profit Sharing Awards and Discretionary  Awards.

(a) With respect to each Plan Year and to the extent provided under this Section 2.2, the Company shall credit a supplemental matching award ("Supplemental Match") to each eligible Participant's Deferral Account. The Supplemental Match shall be in such percentage of the Participants’ Compensation (excluding Bonus Compensation) deferred under this Plan as shall be determined by the Compensation Committee of the Board in its sole discretion from year to year. The Supplemental Match shall apply to each Participant as of the first payroll period during the Plan Year in which such Participant’s Compensation (including Bonus Compensation) exceeds the limitations imposed under Section 401(a)(17) of the Code and shall be credited to the Participant’s Deferral Account for such payroll period and each subsequent payroll period during the Plan Year in which the Participant is eligible for the Supplemental Match. The Supplemental Match shall be credited to such Participant’s Termination Account or, as applicable, Specified Date Account (determined by the Deferral Election of such Participant for the Deferral to which such Supplemental Match relates) within thirty (30) days of such Deferral (recognizing that the Supplemental Match relates only to Deferrals of Compensation exceeding the statutory limit set forth above. Those Participants eligible to participate in the Company's Executive Security Plan, or who, through the terms of an individual employment agreement have an entitlement to supplemental retirement benefits, shall not be eligible to participate in the Supplemental Match. In the event a Participant subsequently loses eligibility to participate in the Executive Security Plan or his employment agreement is amended to eliminate supplemental retirement benefits, such Participant shall regain eligibility to share in the Supplemental Match for that portion of the Plan Year following such Participant's loss of eligibility to participate in the Executive Security Plan or elimination of supplemental retirement benefits as set forth herein. Participants who become eligible for participation in the Executive Security Plan, or who are granted supplemental retirement benefits through an individual employment agreement will be allowed to retain the Supplemental Match contributed up to such eligibility, subject to the normal vesting provisions in Section 2.2(e).

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(b) With respect to any Plan Year and to the extent provided under this Section 2.2, the Company may credit a Supplemental Discretionary Award (the "Supplemental Discretionary Award") to any eligible Participant's Deferral Account. The determination of a Participant to whom such Supplemental Discretionary Award applies, as well as the amount of such award, if any, shall be in the sole discretion of the Chief Executive Officer, pursuant to an agreement between the Company and such Participant (the "Award Agreement"), provided, however, that deferrals of Supplemental Discretionary Awards may be negotiated with a Participant prior to the date the Participant has a legally binding right to such award. A Supplemental Discretionary Award shall be credited to a Participant’s Termination Account or, as applicable, Specified Date Account in accordance with the provisions of the applicable Award Agreement.

(c) With respect to any Plan Year for which the Company makes a profit sharing contribution to the Thrift Plan and for which a Participant has Compensation (including Bonus Compensation) that exceeds the limitations imposed under Section 401(a)(17) of the Code, to the extent provided under this Section 2.2, the Company may credit to such Participant’s Deferral Account a discretionary profit sharing award. Such award, if any, shall be a percentage of such excess compensation that may or may not be equal to the percentage of compensation contributed for such Plan Year as a profit sharing contribution on behalf of participants in the Thrift Plan. Further, for any Plan Year in which a Participant is not able to receive the entire allocation to which such Participant would otherwise be entitled under the terms of the Thrift Plan due solely to the limitations of Section 415 of the Code, the Company may credit to such Participant’s Deferral Account the amount by which such Participant’s allocation to the Thrift Plan would otherwise exceed the limits of Section 415 for such Plan Year. Amounts, if any, credited under this section 2.2(c) shall be “Supplemental Discretionary Profit Sharing Awards”. Supplemental Discretionary Profit Sharing Awards, if any, will be credited to the Participant's Termination Account or, as applicable, Specified Date Account in accordance with the Deferral Election of such Participant for the Plan Year to which such Supplemental Discretionary Profit Sharing Award relates.

(d) Supplemental Match, Supplemental Discretionary Awards, and Supplemental Discretionary Profit Sharing Awards shall be credited to a Participant’s Termination Account or, as applicable, Specified Date Account as provided above and shall be deemed invested in the same manner in which the remainder of such account is deemed to be invested under Section 2.4(b).

(e) Subject to Section 2.3 and Exhibit 1 hereof, each Participant shall vest in the portion of his Deferral Account attributable to a Supplemental Match upon the completion of three (3) years of service and to that portion of his Deferral Account attributable to a Supplemental Discretionary Profit Sharing Award upon the completion of one (1) year of service. Years of service shall be determined in accordance with the methodology set forth in the Thrift Plan for determining years of service for vesting purposes thereunder. Each Participant shall vest in that portion of his Deferral Account attributable to a Supplemental Discretionary Award in accordance with the provisions of the Award Agreement pursuant to which such Supplemental Discretionary Award is credited.

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2.3     Change in Control.

In the event of a Corporate Change in Control, the portion of a Participant's Deferral Account attributable to any Supplemental Match, Supplemental Discretionary Profit Sharing Award, and any Supplemental Discretionary Award shall become fully vested. A Corporate Change in Control is not an event which triggers an automatic distribution of benefits.

2.4     Deferral Accounts/Earnings.

(a) Unless otherwise determined by the Committee, the Company shall maintain on behalf of each Participant separate Deferral Account(s), which shall consist of a Termination Account and, as applicable, Specified Date Accounts up to the maximum permitted under this Plan.

(b) The Participant's Termination Account and, as applicable, Specified Date Accounts shall be adjusted by an amount equal to the amount that would have been earned (or lost) if the Deferrals of such Participant and Company contributions credited on behalf of such Participant under this Plan had been invested in hypothetical investments designated by the Participant from time to time, based on a list of hypothetical investments provided by the Committee from time to time (such hypothetical earnings or losses shall be referred to as "Earnings"); provided, however, in no event shall the common stock of the Company or any Subsidiary ever constitute a hypothetical investment maintained under the Plan. The Participant shall designate the investments used to measure Earnings from the list of authorized investments provided by the Committee by completing the appropriate form (or electronically via the website made available for such purpose) or in such other manner as the Committee may designate from time to time. The Participant may change such designations at such times as are permitted by the Committee, provided that the Participant shall be entitled to change such designations at least quarterly. Earnings shall be credited to the Participant's Deferral Account at least annually (or more frequently at the discretion of the Committee). Earnings shall be credited to a Deferral Account until all payments with respect to such account have been made under this Plan. Neither the Company nor the Committee shall act as a guarantor, or be liable or otherwise responsible for the investment performance of the designated investments (including any losses sustained by a Participant) with respect to a Participant's Deferral Account.

(c) Each Participant shall be vested in his Deferral Account balances in accordance with the vesting designated in Sections 2.1(f), 2.2(e) and 2.3 hereof, or, as applicable, pursuant to Exhibit 1.

ARTICLE III
DISTRIBUTIONS

3.1     Termination Account Distribution Dates.

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Except in the event of death or a Separation from Service due to Disability, distributions of a Participant’s Termination Account upon such Participant’s Separation from Service shall be made or, as applicable, commence on (i) the first business day of the January immediately following such Separation from Service or (ii) if later, the first business day of the seventh month following the month in which such Separation from Service occurs. Notwithstanding the foregoing, distribution of that portion of a Participant's Termination Account that is attributable to Supplemental Discretionary Awards shall be made at such time as may be designated and set forth in the Award Agreement pursuant to which such Supplemental Discretionary Award is credited. Each distribution shall be valued as of the last business day of the month immediately
preceding the month in which such distribution occurs.

3.2     Termination Account Distribution Option/Manner of Payment.

The Distribution Option for a Participant’s Termination Account shall be determined in accordance with such election procedures as are established by the Committee and distributions shall, in accordance with such Participant’s Deferral Election, be paid in the form of a lump sum or in installments over a period of 2-to-15 years; provided, however, that the Distribution Option must be established at the time of such Participant's Deferral Election, in accordance with the requirements of Section 2.1 hereof, and must be in a form acceptable to the Committee as determined from time to time. Notwithstanding the preceding provisions of this Section 3.2, if a Participant fails to designate a form of distribution, or if the balance in the Participant's Deferral Account(s) in the aggregate is less than $100,000 at such Participant’s Separation from Service, the distribution will be paid in the form of a lump sum regardless of the Participant's Deferral Election. Notwithstanding the foregoing, distribution of that portion of a Participant's Termination Account that is attributable to Supplemental Discretionary Awards shall be made in such manner as may be designated and set forth in the Award Agreement pursuant to which such Supplemental Discretionary Award is credited. All payments under the Plan shall be made in cash.

3.3     Specified Date Account Distribution Dates.

Distribution Dates for a Participant's Specified Date Account(s) shall be established and determined in accordance with the Participant's Deferral Elections. A Participant must choose a designated Distribution Date for each Specified Date Account among the following: (i) benefits to be paid or, as applicable, commence on the designated Distribution Date regardless of whether such Participant’s employment status with the Company or any Affiliate (a “Future Date Account”) or (ii) benefits to be paid or, as applicable, commence at the earlier of the designated Distribution Date or such Participant’s Separation from Service (an “In-Service Account”). Notwithstanding the foregoing, distribution of that portion of a Participant's Specified Date Account that is attributable to Supplemental Discretionary Awards shall be made at such time as may be designated and set forth in the Award Agreement pursuant to which such Supplemental Discretionary Award is credited. Payment of each Specified Date Account will be made or, as applicable, commence on the first business day of the month immediately following the month in which the Distribution Date or, as applicable, the date set forth in the Award Agreement occurs and shall be valued as of the last business day of the month immediately preceding the month in which such distribution occurs.

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With respect to a Future Date Account, the vested portion of such account will be paid only in accordance with the Distribution Date elected by the Participant or, as applicable, the date set forth in the Award Agreement, notwithstanding any intervening Separation from Service of such Participant prior to such Distribution Date.

With respect to an In-Service Account, the vested portion of such account will be paid or, as applicable, commence in accordance with the Distribution Date elected by the Participant or, as applicable, the date set forth in the Award Agreement, unless there is an intervening Separation from Service of such Participant prior to the commencement of the distribution of such In-Service Account, in which case, such In-Service Account shall be paid at the same time as such Participant’s Termination Account.

Any Specified Date Account of a Participant for which distribution has commenced prior to such Participant’s Separation from Service shall continue distributions in the manner originally elected by the Participant for such account, or, as applicable, set forth in such Participant’s Award Agreement, notwithstanding any subsequent Separation from Service of such Participant.

3.4     Specified Date Account Distribution Option/Manner of Payment.

Subject to Section 3.3, a Participant’s Distribution Option for a Specified Date Account shall be determined in accordance with such election procedures as are established by the Committee and distributions shall, in accordance with such Participant’s Deferral Election, be paid in the form of a lump sum or in installments over a period of 2-to-5 years; provided, however, that the Distribution Option must be established at the time of the Participant's Deferral Election, in accordance with the requirements of Section 2.1 hereof, and must be in a form acceptable to the Committee as determined from time to time. Notwithstanding the preceding provisions of this Section 3.4, if a Participant fails to designate a form of distribution, or if the balance in the Participant's Deferral Account(s) in the aggregate is less than $100,000 at such Participant’s Separation from Service, the distribution will be paid in the form of a lump sum regardless of the Participant's Deferral Election. Notwithstanding the foregoing, distribution of that portion of a Participant's Specified Date Account that is attributable to Supplemental Discretionary Awards shall be made in such manner as may be designated and set forth in the Award Agreement pursuant to which such Supplemental Discretionary Award is credited. All payments under the Plan shall be made in cash.

3.5     Modification of Distribution Elections.

A Participant has the right to change any Distribution Date or Distribution Option associated with the Deferral Account previously designated by the Participant in one or more Deferral Elections pursuant to this Article III; provided, however, that: (1) the Participant must file an election designating the new Distribution Date and Distribution Option at least one year prior to the Distribution Date previously designated; (2) the new Distribution Option may extend, but not accelerate, payments; and (3) the new election must also provide that the new Distribution Date be a minimum of five years later than the existing Distribution Date. Any such election shall be made 

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in accordance with such rules and procedures as are established by the Committee and shall not take effect for at least twelve (12) months after the date on which such election is made.

3.6     Separation from Service.

Notwithstanding the foregoing provisions, in the event of a Participant's Separation from Service for any reason other than death or Disability, the Participant will receive a payment of all vested amounts credited to the Participant's Deferral Accounts (other than Future Date Accounts and In-Service Accounts that have commenced distribution) as elected by the Participant pursuant to Section 3.2, subject to any modifications elected by the Participant pursuant to Section 3.5, or as otherwise provided in Section 3.2 hereof. Any portion of a Participant's Deferral Account attributable to a Supplemental Match, Supplemental Discretionary Profit Sharing Award, or a Supplemental Discretionary Award that is not vested on the date of such Participant's Separation from Service shall be forfeited by the Participant should he or she fail to satisfy the vesting conditions of Sections 2.1(f), 2.2(e) or 2.3. Such forfeited amount shall revert to the Company and shall remain a general corporate asset to be used for any purpose determined by the Company.

3.7     Death.

Notwithstanding the foregoing provisions, the Beneficiary or Beneficiaries of a Participant shall be entitled to receive the entire amount credited to such Participant's Deferral Accounts (including all Specified Date Accounts) at the time of such Participant's death, valued as of the last business day of the month in which such Participant’s death occurred. Any unvested amounts remaining in such Participant's Deferral Accounts shall immediately become fully vested upon the Participant's death. The value of the Participant's Deferral Accounts will be paid to the Participant's Beneficiary, including the Participant's estate if designated as the Beneficiary, in a lump sum within ninety (90) days following the Participant's death. The Participant shall designate his Beneficiary in accordance with the provisions of Article V hereof.

3.8     Disability.

Notwithstanding the foregoing provisions, in the event of Disability, a Participant shall continue to accrue vesting service until fully vested in his Deferral Accounts or, if earlier, until his Disability Date. The Participant will receive a payment of all vested amounts credited to such Participant's Deferral Accounts (including all Specified Date Accounts) as of his Disability Date, in the manner provided in his Deferral Election (or, as applicable Award Agreement) or, if earlier, on his Distribution Date. Any portion of a Participant's Deferral Account attributable to a Supplemental Match, Supplemental Discretionary Profit Sharing Award, or a Supplemental Discretionary Award that is not vested on such Participant's Disability Date shall be forfeited by the Participant should he or she fail to satisfy the vesting conditions of Sections 2.1(f), 2.2(e) or 2.3. Such forfeited amount shall revert to the Company and shall remain a general corporate asset to be used for any purpose determined by the Company.

3.9     Unforeseeable Emergency.

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The Committee may, upon request of a Participant, cause to be paid to such Participant an amount equal to all or any part of the amounts credited to such Participant's Deferral Account if the Committee determines, in its absolute discretion based on such reasonable evidence that it shall require, that such a payment or payments is necessary for the purpose of alleviating the consequences of an Unforeseeable Emergency occurring with respect to the Participant. The amounts distributed with respect to an Unforeseeable Emergency may not exceed the amount necessary to satisfy the emergency plus amounts necessary to pay taxes on the distribution, after taking into account the extent to which the hardship is or may be relieved through reimbursement or compensation by insurance or otherwise or by liquidation of the Participant's assets (to the extent liquidation would not itself cause severe financial hardship). The amount of emergency payment shall be subtracted first from the vested portion of such Participant’s Termination Account until depleted and then from the vested portion of such Participant’s Specified Date Accounts, beginning with the Specified Date Account with the latest payment commencement date. Any such distribution upon an Unforeseeable Emergency shall result in a termination of Deferrals that would otherwise be credited on behalf of such Participant for the Plan Year in which the distribution on account of an Unforeseeable Emergency occurs, together with any Supplemental Match associated with such Deferrals.

3.10     Change in Time of Payments.

Notwithstanding any provision of this Article III to the contrary, the benefits payable hereunder may, to the extent expressly provided in this Section 3.10, be paid prior to or later than the date on which they would otherwise be paid to the Participant.

(a) Distribution in the Event of Income Inclusion Under Code Section 409A. If any portion of a Participant's Deferral Accounts is required to be included in income by the Participant prior to receipt due to a failure of this Plan or any Aggregated Plan to comply with the requirements of Code Section 409A and the Regulations, the Committee may determine that such Participant shall receive a distribution from the Plan in an amount equal to the lesser of: (i) the portion of his or her Deferral Account required to be included in income as a result of the failure of the Plan or any Aggregated Plan to comply with the requirements of Code Section 409A and the Regulations, or (ii) the balance of the Participant's Deferral Account.

(b) Distribution Necessary to Satisfy Applicable Tax Withholding. If the Company is required to withhold amounts to pay the Participant’s portion of the Federal Insurance Contributions Act (FICA) tax imposed under Code Sections 3101, 3121(a) or 3121(v)(2) with respect to amounts that are or will be paid to the Participant under the Plan before they otherwise would be paid, the Committee may determine that such Participant shall receive a distribution from the Plan in an amount equal to the lesser of: (i) the amount in the Participant's Deferral Accounts or (ii) the aggregate of the FICA taxes imposed and the income tax withholding related to such amount.

(c) Delay for Payments in Violation of Federal Securities Laws or Other Applicable Law. In the event the Company reasonably anticipates that the payment of benefits as specified hereunder would violate Federal securities laws or other applicable law, the 

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Committee may delay the payment under this Article III until the earliest date at which the Company reasonably anticipates that the making of such payment would not cause such violation.

(d) Delay for Insolvency or Compelling Business Reasons. In the event the Company determines that the making of any payment of benefits on the date specified hereunder would jeopardize the ability of the Company to continue as a going concern, the Committee may delay the payment of benefits under this Article III until the first calendar year in which the Company notifies the Committee that the payment of benefits would not have such effect.

(e) Administrative Delay in Payment. The payment of benefits hereunder shall begin at the date specified in accordance with the provisions of the foregoing paragraphs of this Article III; provided that, in the case of administrative necessity, the payment of such benefits may be delayed up to the later of the last day of the calendar year in which payment would otherwise be made or the 15th day of the third calendar month following the date on which payment would otherwise be made. Further, if, as a result of events beyond the control of the Participant (or following the Participant's death, the Participant's Beneficiary), it is not administratively practicable for the Committee to calculate the amount of benefits due to Participant as of the date on which payment would otherwise be made, the payment may be delayed until the first calendar year in which calculation of the amount is administratively practicable.

(f) No Participant Election. Notwithstanding the foregoing provisions, if the period during which payment of benefits hereunder will be made occurs, or will occur, in two calendar years, the Participant shall not be permitted to elect the calendar year in which the payment shall be made.

3.11     409A Change in Control.

If a 409A Change in Control occurs before all Deferral Account(s) have been fully distributed, the remaining balance of all such Deferral Account(s) (including all Specified Date Accounts) shall be distributed in the form of a single lump sum payable at the end of the fifteenth (15th) month following the month in which such 409A Change in Control is effective, unless a Participant makes a timely election during the first three (3) months following the 409A Change in Control, in compliance with Section 3.5, to delay commencement of benefits from such Participant’s Deferral Account(s) by a minimum of five (5) years and to receive the benefits in the form of a lump sum, in which case distribution shall be made in accordance with such Participant’s modified election.

ARTICLE IV
FUNDING

4.1     Unsecured Obligation of Company.

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(a) Any benefit payable pursuant to this Plan shall be paid from the general assets of the Company. Nothing contained in this Plan and no action taken pursuant to the provisions of this Plan shall create a trust of any kind or a fiduciary relationship between any Participant (or any other interested person) and the Company or the Committee, or require the Company to maintain or set aside any specific funds for the purpose of paying any benefit hereunder. To the extent that a Participant or any other person acquires a right to receive payments from the Company under this Plan, such right shall be no greater than the right of any unsecured general creditor of the Company.

(b) If the Company maintains a separate fund or makes specific investments, including the purchase of insurance on the life of the a Participant, to assure its ability to pay any benefits due under this Plan, neither the Participant nor the Participant's Beneficiary shall have any legal or equitable ownership interest in, or lien on, such fund, policy, investment or any other asset of the Company. The Company, in its sole discretion, may determine the exact nature and method of informal funding (if any) of the obligations under this Plan. If the Company elects to maintain a separate fund or makes specific investments to fund its obligations under this Plan, the Company reserves the right, in its sole discretion, to terminate such method of funding at any time, in whole or in part. In addition, the Company may, in its sole and absolute discretion, set aside or earmark funds in an amount, determined by the Committee, equal to the total amounts necessary to provide benefits under the Plan. The Committee may, at its discretion direct the Company to establish one or more grantor trusts to provide for the ultimate payment of the Company's obligations under this Plan, but the trust instrument for any such trust must specifically provide that its assets are subject to the claims of the Company's creditors. Such grantor trust may require that the Company fully fund said trust with respect to benefits accrued through the date of a Corporate Change in Control following such a Corporate Change in Control.

4.2     Cooperation of Participant.

If the Company, in its sole discretion, elects to invest in a life insurance, disability or
annuity policy on the life of a Participant to assist with the informal funding of its obligations
under this Plan, the Participant shall assist the Company, from time to time, promptly upon the
request of the Company, in obtaining such insurance policy by supplying any information
necessary to obtain such policy as well as submitting to any physical examinations required
therefore. The Company shall be responsible for the payment of all premiums with respect to
any whole life, variable, or universal life insurance policy purchased in connection with this Plan
unless otherwise expressly agreed.

ARTICLE V
BENEFICIARIES

5.1     Beneficiary Designations.

A designation of a Beneficiary hereunder may be made only by an instrument (in form acceptable to the Committee) signed by the Participant and filed with the Committee prior to the 

17

Participant's death. In the absence of such a designation and at any other time when there is no existing Beneficiary designated hereunder, the unpaid value of the Participant's Deferral Accounts to which the Participant was entitled at his death shall be distributed to the Participant's estate. A Beneficiary who dies or which ceases to exist shall not be entitled to any part of any payment thereafter to be made to the Participant's Beneficiary unless the Participant's designation specifically provides to the contrary. If two or more persons designated as a Participant's Beneficiary are in existence with respect to a single deferred compensation benefit, the amount of any payment to the Beneficiary under this Plan shall be divided equally among such persons, unless the Participant's designation specifically provides to the contrary.

5.2     Change in Beneficiary.

A Participant may, at any time and from time to time, change a Beneficiary designation hereunder without the consent of any existing Beneficiary or any other person. Any change in Beneficiary shall be made only by an instrument (in form acceptable to the Committee) signed by the Participant, and any change shall be effective only if received by the Committee prior to the death of the Participant.

ARTICLE VI
CLAIMS PROCEDURES

6.1     Claims for Benefits.

The Committee shall determine the rights of any Participant to any deferred compensation benefits hereunder. Any Participant who believes that he has not received the deferred compensation benefits to which he is entitled under the Plan may file a claim in writing with the Committee. The Committee shall, no later than 90 days after the receipt of a claim (plus an additional period of 90 days if required for processing, provided that notice of the extension of time is given to the claimant with the first 90-day period), either allow or deny the claim in writing.

A denial of a claim by the Committee, wholly or partially, shall be written in a manner intended to be understood by the claimant and shall include:
(a) the specific reasons for the denial;
(b) specific reference to pertinent Plan provisions on which the denial is based;
(c) a description of any additional material or information necessary for the claimant to perfect the claim and an explanation of why such material or information is necessary; and
(d) an explanation of the claim review procedure and the time limits applicable to such procedures, including a statement of the claimant's right to bring a civil action under Section 502(a) of ERISA.

6.2     Appeal Provisions.

A claimant whose claim is denied (or his duly authorized representative) may within 60 days after receipt of denial of a claim file with the Committee a written request for a review of

18

such claim. If the claimant does not file a request for review of his claim within such 60-day period, the claimant shall be deemed to have acquiesced in the original decision of the Committee on his claim, the decision shall become final and the claimant will not be entitled to bring a civil action under Section 502(a) of ERISA. If such an appeal is so filed within such 60- day period the Company (or its delegate) shall conduct a full and fair review of such claim. During such review, the claimant (or the claimant's authorized representative) shall be given the opportunity to review all documents that are pertinent to his claim and to submit issues and comments in writing.

The Company shall mail or deliver to the claimant a written decision on the matter based on the facts and the pertinent provisions of the Plan within 60 days after the receipt of the request for review (unless special circumstances require an extension of up to 60 additional days, in which case written notice of such extension shall be given to the claimant prior to the commencement of such extension). Such decision shall be written in a manner intended to be understood by the claimant, shall state the specific reasons for the decision and the specific Plan provisions on which the decision was based and shall, to the extent permitted by law, be final and binding on all interested persons.

ARTICLE VII
MISCELLANEOUS

7.1     Withholding.

The Company shall be required to withhold from any distribution payable under the Plan an amount sufficient to satisfy all federal, state and local tax withholding requirements.

7.2     No Guarantee of Employment.

Nothing in this Plan shall be construed as guaranteeing future employment to any Participant. Without limiting the generality of the preceding sentence, except as otherwise set forth in a written agreement, a Participant continues to be an employee of the Company solely at the will of the Company subject to discharge at any time, with or without cause. The benefits provided for herein for a Participant shall not be deemed to modify, affect or limit any salary or salary increases, bonuses, profit sharing or any other type of compensation of a Participant in any manner whatsoever. Nothing contained in this Plan shall affect the right of a Participant to participate in or be covered by or under any qualified or nonqualified pension, profit sharing, group, bonus or other supplemental compensation, retirement or fringe benefit Plan constituting any part of the Company's compensation structure whether now or hereinafter existing.

7.3     Payment to Guardian.

If a benefit payable hereunder is payable to a minor, to a person declared incompetent or to a person incapable of handling the disposition of his property, the Committee may direct payment of such benefit to the guardian, legal representative or person having the care and custody of such minor, incompetent or person. The Committee may require such proof of incompetency, minority, incapacity or guardianship, as it may deem appropriate prior to distribution of the benefit. Such distribution shall completely discharge the Company from all liability with respect to such benefit.

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7.4     Assignment.

No right or interest under this Plan of any Participant or Beneficiary shall be assignable or transferable in any manner or be subject to alienation, anticipation, sale, pledge, encumbrance or other legal process or in any manner be liable for or subject to the debts or liabilities of the Participant or Beneficiary.

7.5     Severability.

If any provision of this Plan or the application thereof to any circumstance(s) or person(s) is held to be invalid by a court of competent jurisdiction, the remainder of the Plan and the application of such provision to other circumstances or persons shall not be affected thereby.

7.6     Amendment and Termination.

The Company may at any time (without the consent of any Participant) modify, amend or terminate any or all of the provisions of this Plan; provided, however, that no modification, amendment or termination of this Plan shall adversely affect the rights of a Participant under the Plan without the consent of such Participant. Notwithstanding the foregoing or any provision of the Plan to the contrary, the Company may at any time (without the consent of any Participant) modify, amend or terminate any or all of the provisions of this Plan to the extent necessary to conform the provisions of the Plan with Section 409A of the Code regardless of whether such modification, amendment or termination of this Plan shall adversely affect the rights of a Participant under the Plan. Any amendment or termination of the Plan shall be at the direction of the Compensation Committee of the Board. Notwithstanding the foregoing, the Plan shall automatically terminate, without further action of the Company, upon Insolvency of the Company.

7.7     Effect of Termination.

If the Plan is terminated, all deferrals shall thereupon cease, but Earnings shall continue to be credited to the Deferral Accounts in accordance with Section 2.4 hereof. Notwithstanding the foregoing, to the extent provided by the Company in accordance with Section 7.6, the Plan may be liquidated following a termination under any of the following circumstances:

(a) the termination and liquidation of the Plan within twelve (12) months of a complete dissolution of the Company taxed under Section 331 of the Code or with the approval of a bankruptcy court pursuant to 11 U.S.C. § 503(b)(1)(A); provided that the amounts deferred under this Plan are included in the Participants' gross incomes in the latest of the following years (or, if earlier, the taxable year in which the amount is actually or constructively received): (i) the calendar year in which the Plan is terminated; (ii) the first calendar year in which the amount is no longer subject to a substantial risk of forfeiture; or (iii) the first calendar year in which the payment is administratively practicable.

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(b) the termination and liquidation of the Plan pursuant to irrevocable action taken by the Company within the thirty (30) days preceding or the twelve (12) months following a 409A Change of Control; provided that all Aggregated Plans are terminated and liquidated with respect to each Participant that experienced such change of control, so that under the terms of the termination and liquidation, all such Participants are required to receive all amounts of deferred compensation under this Plan and any other Aggregated Plans within twelve (12) months of the date the Company irrevocably takes all necessary action to terminate and liquidate this Plan and such other Aggregated Plans;

(c) the termination and liquidation of the Plan, provided that: (i) the termination and liquidation does not occur proximate to a downturn in the Company's financial health; (2) the Company terminates and liquidates all Aggregated Plans; (3) no payments in liquidation of this Plan are made within twelve (12) months of the date the Company irrevocably takes all necessary action to terminate and liquidate this Plan, other than payments that would be payable under the terms of this Plan if the action to terminate and liquidate this Plan had not occurred; (4) all payments are made within twenty four (24) months of the date on which the Company irrevocably takes all action necessary to terminate and liquidate this Plan; and (5) the Company does not adopt a new Aggregated Plan at any time within three (3) years following the date on which the Company irrevocably takes all action necessary to terminate and liquidate the Plan.

7.8     Exculpation and Indemnification.

The Company shall indemnify and hold harmless the members of the Committee from and against any and all liabilities, costs and expenses incurred by such persons as a result of any act, or omission to act, in connection with the performance of such person's duties, responsibilities and obligations under the Plan, other than such liabilities, costs and expenses as may result from the gross negligence, willful misconduct, and/or criminal acts of such persons.

7.9     Confidentiality.

In further consideration of the benefits available to each Participant under this Plan, each Participant shall agree that, except as such may be disclosed in financial statements and tax returns, or in connection with estate planning, all terms and provisions of this Plan, and any agreement between the Company and the Participant entered into pursuant this Plan, are and shall forever remain confidential until the death of Participant; and the Participant shall not reveal the terms and conditions contained in this Plan or any such agreement at any time to any person or entity, other than his respective financial and professional advisors unless required to do so by a court of competent jurisdiction or as otherwise may be required by law.

7.10     Gender and Number.

For purposes of interpreting the provisions of this Plan, the masculine gender shall be deemed to include the feminine, the feminine gender shall be deemed to include the masculine, and the singular shall include the plural unless otherwise clearly required by the context.

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7.11     Governing Law.

Except as otherwise preempted by the laws of the United States, this Plan shall be governed by and construed in accordance with the laws of the State of Texas, without giving effect to its conflict of law provisions.

7.12     Effective Date.

Executed this _______ day of _________________, 2015, to be effective January 1, 2016.

TESORO CORPORATION

By:                                                      
Name:                                                 
Title:                                                   

                

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TESORO CORPORATION

EXECUTIVE DEFERRED COMPENSATION PLAN

Exhibit 1

Notwithstanding any provision of the Plan to the contrary, each Participant who was
employed by Tesoro Hawaii, LLC as of September 25, 2013, the date of the sale by the
Company of all of its interest in Tesoro Hawaii, LLC, shall be immediately 100% vested in his
Deferral Account as of such date.

4815-1583-0558v.8 47436-12
23

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