Document:

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                                                                    EXHIBIT 10.4

                        BINDVIEW DEVELOPMENT CORPORATION
                    1998 NON-EMPLOYEE DIRECTOR INCENTIVE PLAN

                    (AS AMENDED THROUGH SEPTEMBER 2, 2003 AND
                  APPROVED BY THE SHAREHOLDERS ON MAY 27, 2004)

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                        BINDVIEW DEVELOPMENT CORPORATION
                    1998 NON-EMPLOYEE DIRECTOR INCENTIVE PLAN

                                TABLE OF CONTENTS

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1.  PURPOSE ............................................................................................      1
2.  EFFECTIVE DATE OF PLAN .............................................................................      1
3.  ADMINISTRATION .....................................................................................      1
4.  DEDICATED SHARES ...................................................................................      1
5.  GRANT OF OPTIONS ...................................................................................      1
6.  ELIGIBILITY ........................................................................................      1
7.  OPTION GRANT SIZE AND GRANT DATES ..................................................................      2
8.  OPTION PRICE; FAIR MARKET VALUE ....................................................................      2
9.  DURATION OF OPTIONS ................................................................................      2
10. AMOUNT EXERCISABLE .................................................................................      2
11. EXERCISE OF OPTIONS ................................................................................      4
12. NON-TRANSFERABILITY OF OPTIONS .....................................................................      5
13. TERMINATION OF DIRECTORSHIP OF OPTIONEE ............................................................      5
14. REQUIREMENTS OF LAW ................................................................................      5
15. NO RIGHTS AS STOCKHOLDER ...........................................................................      6
16. NO OBLIGATION TO RETAIN OPTIONEE ...................................................................      6
17. CHANGES IN THE COMPANY'S CAPITAL STRUCTURE .........................................................      6
18. TERMINATION AND AMENDMENT OF PLAN ..................................................................      8
19. WRITTEN AGREEMENT ..................................................................................      9
20. INDEMNIFICATION OF BOARD ...........................................................................      9
21. FORFEITURES ........................................................................................      9
22. RESTRICTED STOCK AWARDS ............................................................................      9
23. GENDER .............................................................................................     12
24. HEADINGS ...........................................................................................     12
25. GOVERNING LAW ......................................................................................     12
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                        BINDVIEW DEVELOPMENT CORPORATION

                    1998 NON-EMPLOYEE DIRECTOR INCENTIVE PLAN

      1. PURPOSE. The BindView Development Corporation 1998 Non-Employee
Director Incentive Plan (the "Plan") of BindView Development Corporation (the
"Company") is for the benefit of members of the Board of Directors of the
Company who, at the time of their service, are not employees of the Company or
any of its affiliates, by providing them an opportunity to become owners of the
Common Stock, no par value, of the Company (the "Stock"), thereby advancing the
best interests of the Company by increasing their proprietary interest in the
success of the Company and encouraging them to continue in their present
capacity.

      2. EFFECTIVE DATE OF PLAN. The Plan is effective January 5, 1998, if
within one year of that date it shall have been approved by the holders of at
least a majority of the outstanding shares of voting stock of the Company voting
in person or by proxy at a duly held shareholders' meeting, or if the provisions
of the corporate charter, bylaws or applicable state law prescribes a greater
degree of shareholder approval for this action, the approval by the holders of
that percentage, at a duly held meeting of shareholders, or in either case by a
consent in lieu of a meeting if permitted by the corporate charter, bylaws and
applicable law.

      3. ADMINISTRATION. The Plan shall be administered by the Board of
Directors of the Company (the "Board"). Subject to the terms of the Plan, the
Board shall have the power to construe the provisions of the Plan, Options,
Restricted Stock (as defined in Paragraph 22 below), and Stock issued hereunder,
to determine all questions arising hereunder, and to adopt and amend such rules
and regulations for administering the Plan as the Board deems desirable.

      4. DEDICATED SHARES. Effective upon shareholder approval at the Company's
2004 annual meeting, the total number of shares of Stock with respect to which
Initial Grants or Annual Grants (collectively, the "Options") may be granted
under this Plan shall not exceed, in the aggregate one million (1,000,000)
shares; provided, that the class and aggregate number of shares of Stock which
may be granted hereunder shall be subject to adjustment in accordance with the
provisions of Paragraph 17. The shares of Stock may be treasury shares or
authorized but unissued shares of Stock. In the event that any outstanding
Option shall expire or is terminated or canceled for any reason, the shares of
Stock allocable to the unexercised portion of that Option may again be subject
to an Option or Options under the Plan.

      5. GRANT OF OPTIONS. All Options granted under the Plan shall be
Nonqualified Options which are not intended to satisfy the requirements of
Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"). No
options shall be granted under the Plan subsequent to January 4, 2008.

      6. ELIGIBILITY. The individuals who shall be eligible to receive Options
under the Plan shall be each member of the Board who is not an employee of the
Company or any affiliate of the Company ("Eligible Director").

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      7. OPTION GRANT SIZE AND GRANT DATES. On the day the Eligible Director is
first elected or appointed to be a director (whichever is applicable), the
Eligible Director shall be granted an Option to purchase up to 100,000 shares of
Stock on the terms and conditions set forth herein (an "Initial Grant").

            In each calendar year, on or after the annual meeting of the
Company's shareholders, each Eligible Director who was a director at the time
of, and continues to serve as a director after, such annual meeting, may be
granted an Option to purchase up to 25,000 shares of Stock on the terms and
conditions set forth herein (an "Annual Grant").

            Subject only to any applicable limitations set out in this Plan, the
number of shares of Stock to be covered by any Option granted to an Eligible
Director shall be as determined by the Board. Notwithstanding the provisions of
Section 17, the number of shares of Stock which may subsequently be awarded
pursuant to this Section 7 shall not increase but may be decreased if
appropriate under Section 17. If service of an Eligible Director who previously
received an Initial Grant terminates and the Director is subsequently elected or
appointed to the Board, that Director shall not be eligible to receive a second
Initial Grant.

            If the General Counsel of the Company determines, in his sole
discretion, that the Company is in possession of material, nonpublic information
about the Company or any of its subsidiaries, he may suspend granting of the
Initial Grant or Annual Grant to each Eligible Director until the second trading
day after public dissemination of that information, and the determination by the
General Counsel that issuance of the Options is then appropriate.

      8. OPTION PRICE; FAIR MARKET VALUE. The price at which shares of Stock may
be purchased by each Eligible Director (the "Optionee") pursuant to his Initial
Grant or Annual Grant, shall be 100% of the "Fair Market Value" of the shares of
Stock on the date of grant of the Initial Grant or Annual Grant, as applicable.

            For all purposes of this Plan, the "Fair Market Value" of the Stock
as of any date means (a) the average of the high and low sale prices of the
Stock on that date on the principal securities exchange on which the Stock is
listed; or (b) if the Stock is not listed on a securities exchange, the average
of the high and low sale prices of the Stock on that date as reported on the
NASDAQ National Market System; or (c) if the Stock is not listed on the NASDAQ
National Market System, the average of the high and low bid quotations for the
Stock on that date as reported by the National Quotation Bureau Incorporated;
(d) for any Options issued prior to the initial public offering of the Stock,
the initial public offering price; or (e) if none of the foregoing is
applicable, the average between the closing bid and ask prices per share of
stock on the last preceding date on which those prices were reported or that
amount as determined by the Board.

      9. DURATION OF OPTIONS. The term of each Option shall be ten years from
the date of grant. No Option shall be exercisable after the expiration of ten
years from the date the Option is granted.

      10. AMOUNT EXERCISABLE. (a) Each Option hereunder shall become exercisable
on a cumulative basis over three years as follows: (1) one-third (33%) on the
first annual anniversary of the grant of the Option, and (2) an

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additional one-twelfth (8.33%) each three months after such first annual
anniversary. (b) The Board may in its discretion partially or fully accelerate
the exercisability of any outstanding Option in connection with the Optionee's
resignation from the Board. (c) Upon a Change of Control, each Option shall
become immediately exercisable. For this purpose, a "Change in Control" shall
have occurred if, after the Effective Date of the Plan:

            (i) a report on Schedule 13D or Schedule 14D-1 (or any successor
      schedule, form or report) shall be filed with the Commission pursuant to
      the Exchange Act and that report discloses that any person (within the
      meaning of Section 13(d) or Section 14(d)(2) of the Exchange Act), other
      than the Company (or one of its subsidiaries) or any employee benefit plan
      sponsored by the Company (or one of its subsidiaries), is the beneficial
      owner (as that term is defined in Rule 13d-3 or any successor rule or
      regulation promulgated under the Exchange Act), directly or indirectly, of
      20 percent or more of the outstanding Voting Stock;

            (ii) any person (within the meaning of Section 13(d) or Section
      14(d)(2) of the Exchange Act), other than the Company (or one of its
      subsidiaries) or any employee benefit plan sponsored by the Company (or
      one of its subsidiaries), shall purchase securities pursuant to a tender
      offer or exchange offer to acquire any Voting Stock (or any securities
      convertible into Voting Stock) and, immediately after consummation of that
      purchase, that person is the beneficial owner (as that term is defined in
      Rule 13d-3 or any successor rule or regulation promulgated under the
      Exchange Act), directly or indirectly, of 20 percent or more of the
      outstanding Voting Stock (such person's beneficial ownership to be
      determined, in the case of rights to acquire Voting Stock, pursuant to
      paragraph (d) of Rule 13d-3 or any successor rule or regulation
      promulgated under the Exchange Act);

            (iii) the consummation of:

                        (x) a merger, consolidation or reorganization of the
      Company with or into any other person if (a) the Company is not the
      surviving entity or (b) as a result of such merger, consolidation or
      reorganization, 50 percent or less of the combined voting power of the
      then-outstanding securities of such other person immediately after such
      merger, consolidation or reorganization are held in the aggregate by the
      holders of Voting Stock immediately prior to such merger, consolidation or
      reorganization;

                        (y) any sale, lease, exchange or other transfer of all
      or substantially all the assets of the Company and its consolidated
      subsidiaries to any other person if as a result of such sale, lease,
      exchange or other transfer, 50 percent or less of the combined voting
      power of the then-outstanding securities of such other person immediately
      after such sale, lease, exchange or other transfer are held in the
      aggregate by the holders of Voting Stock immediately prior to such sale,
      lease, exchange or other transfer; or

                        (z) a transaction immediately after the consummation of
      which any person (within the meaning of Section 13(d) or Section 14(d)(2)
      of the Exchange Act) would be

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      the beneficial owner (as that term is defined in Rule 13d-3 or any
      successor rule or regulation promulgated under the Exchange Act), directly
      or indirectly, of more than 50 percent of the outstanding Voting Stock;

            (iv) the stockholders of the Company approve the dissolution of the
      Company; or

            (v) during any period of 12 consecutive months, the individuals who
      at the beginning of that period constituted the Board of Directors shall
      cease to constitute a majority of the Board of Directors, unless the
      election, or the nomination for election by the Company's stockholders, of
      each director of the Company first elected during such period was approved
      by a vote of at least a two-thirds of the directors of the Company then
      still in office who were directors of the Company at the beginning of any
      such period.

            "Voting Stock" means shares of the capital stock of the Company the
holders of which are entitled to vote for the election of directors, but
excluding shares entitled to so vote only upon the occurrence of a contingency
unless that contingency shall have occurred.

      11. EXERCISE OF OPTIONS. Each Option shall be exercised by the delivery of
written notice to the Committee setting forth the number of shares of Stock with
respect to which the Option is to be exercised, together with: (a) cash,
certified check, bank draft, or postal or express money order payable to the
order of the Company for an amount equal to the option price of the shares, (b)
Mature Shares at their Fair Market Value on the date of exercise, (c) payment to
the Company, through a broker-assisted exercise that is approved by the
Committee, for an amount equal to the option price of the shares, (d) any
combination of (a), (b), or (c), and/or (e) any other form of payment which is
acceptable to the Committee, and specifying the address to which the
certificates for the shares are to be mailed.

            As promptly as practicable after receipt of written notification and
payment, the Company shall deliver to the Eligible Director certificates for the
number of shares with respect to which the Option has been exercised, issued in
the Eligible Director's name.

            Whenever an Option is exercised by exchanging Mature Shares owned by
the Optionee, the Optionee shall deliver to the Company certificates registered
in the name of the Optionee representing a number of Mature Shares legally and
beneficially owned by the Optionee, free of all liens, claims, and encumbrances
of every kind, accompanied by stock powers duly endorsed in blank by the record
holder of the shares represented by the certificates, (with signature guaranteed
by a commercial bank or trust company or by a brokerage firm having a membership
on a registered national stock exchange). The delivery of certificates upon the
exercise of Options is subject to the condition that the person exercising the
Option provide the Company with the information the Company might reasonably
request pertaining to exercise, sale or other disposition.

            If Mature Shares are used in payment, the aggregate Fair Market
Value of the Mature Shares tendered must be equal to or less than the aggregate
exercise price of the shares being purchased upon exercise of

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the Option, and any difference must be paid by cash, certified check, bank
draft, or postal or express money order payable to the order of the Company.
Delivery of the shares shall be deemed effected for all purposes when a stock
transfer agent of the Company shall have deposited the certificates in the
United States mail, addressed to the Eligible Director, at the address specified
by the Eligible Director.

            Notwithstanding any other provision of the Plan, the Committee shall
have the authority to cause an Optionee to utilize a different method of
exercise if the method selected by the Optionee could result in adverse
accounting treatment for the Company.

            "Mature Shares" means shares of Stock that have been legally and
beneficially owned by the Optionee for at least six months.

      12. NON-TRANSFERABILITY OF OPTIONS. Options shall not be transferable by
the Optionee other than by will or under the laws of descent and distribution,
and shall be exercisable, during the Optionee's lifetime, only by him.
Notwithstanding any provision in this Plan to the contrary, an Eligible Director
may transfer an Option to an Immediate Family Member or an entity controlled by
an Eligible Director or an Immediate Family Member, provided, however, no
further transfer shall be made except by operation of law or a transfer back to
such Eligible Director or such other transfer which may be approved by the
Board. For this purpose, "Immediate Family Member" means an Eligible Director's
children, grandchildren or spouse, or a trust for the benefit of such Immediate
Family Members.

      13. TERMINATION OF DIRECTORSHIP OF OPTIONEE. If, before the date of
expiration of the Option, the Optionee shall cease to be a director of the
Company, the Option shall terminate on the earlier of the date of expiration or
90 days after the date of ceasing to serve as a director. In this event, the
Optionee shall have the right, prior to the termination of the Option, to
exercise the Option if he was entitled to exercise immediately prior to ceasing
to serve as a director.

            Upon the death or disability of the Optionee while serving as a
director, his options shall become fully vested and, in the case of death his
executors, administrators, or any person or persons to whom his Option may be
transferred by will or by the laws of descent and distribution, shall have the
right, at any time prior to the earlier of the date of expiration of the Option
or 12 months following the date of his death, to exercise the Option, in whole
or in part.

      14. REQUIREMENTS OF LAW. The Company shall not be required to sell or
issue any Stock under any Option if issuing that Stock would constitute or
result in a violation by the Optionee or the Company of any provision of any
law, statute, or regulation of any governmental authority. Specifically, in
connection with any applicable statute or regulation relating to the
registration of securities, upon exercise of any Option, the Company shall not
be required to issue any Stock unless the Company has received evidence
satisfactory to it to the effect that the holder of that Option will not
transfer the Stock except in accordance with applicable law, including receipt
of an opinion of counsel satisfactory to the Company to the effect that any
proposed transfer complies with applicable law. The determination by the Company
on this matter shall be final, binding and conclusive. The Company may, but
shall in no event be obligated to, register any Stock covered by this Plan
pursuant to applicable securities laws of

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any country or any political subdivision. In the event the Stock issuable on
exercise of an Option is not registered, the Company may imprint on the
certificate evidencing the Stock any legend that counsel for the Company
considers necessary or advisable to comply with applicable law. The Company
shall not be obligated to take any other affirmative action in order to cause
the exercise of an Option, or the issuance of shares under it, to comply with
any law or regulation of any governmental authority.

      15. NO RIGHTS AS STOCKHOLDER. No Optionee shall have any rights as a
stockholder with respect to Stock covered by any Option until the date a stock
certificate is issued for the Stock, and, except as otherwise provided in
Paragraph 17 hereof, no adjustment for dividends, or otherwise, shall be made if
the record date thereof is prior to the date of issuance of such certificate.

      16. NO OBLIGATION TO RETAIN OPTIONEE. The granting of any Option shall not
impose upon the Company or its stockholders any obligation to retain or continue
to retain any Optionee or nominate any Optionee for election to continue in his
capacity as a director of the Company. The right of the Company, the Board of
Directors, and the Stockholders to terminate the service of any Optionee as a
director shall not be diminished or affected by reason of the fact that one or
more Options have been or would be granted to him.

      17. CHANGES IN THE COMPANY'S CAPITAL STRUCTURE. The existence of
outstanding Options shall not affect in any way the right or power of the
Company or its stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the Company's capital
structure or its business, or any merger or consolidation of the Company, or any
issue of bonds, debentures, preferred or prior preference stock ahead of or
affecting the Stock or its rights, or the dissolution or liquidation of the
Company, or any sale or transfer of all or any part of its assets or business,
or any other corporate act or proceeding, whether of a similar character or
otherwise.

            If the Company shall effect a subdivision or consolidation of shares
or other capital readjustment, the payment of a stock dividend, or other
increase or reduction of the number of shares of the Stock outstanding, without
receiving compensation for it in money, services or property, then (a) the
number, class, and per share price of shares of Stock subject to outstanding
Options under this Plan shall be appropriately adjusted in such a manner as to
entitle an Optionee to receive upon exercise of an Option, for the same
aggregate cash consideration, the equivalent total number and class of shares he
would have received had he exercised his Option in full immediately prior to the
event requiring the adjustment; and (b) the number and class of shares of Stock
with respect to which Options may be granted under the Plan shall be adjusted by
substituting for the total number and class of shares of Stock then available
for grant, that number and class of shares of Stock that would have been
received by the owner of an equal number of outstanding shares of each class of
Stock as the result of the event requiring the adjustment.

            If while unexercised Options remain outstanding under the Plan (i)
the Company shall not be the surviving entity in any merger, consolidation or
other reorganization (or survives only as a subsidiary of an entity other than
an entity that was wholly-owned by the Company immediately prior to such merger,
consolidation or other reorganization), (ii) the Company sells, leases or
exchanges or agrees to sell, lease or exchange all or substantially all of its
assets to any other person or entity (other than an entity wholly-owned by the
Company), (iii) the Company is to be dissolved, or (iv) the Company is a party
to any other corporate transaction (as defined under Section 424(a) of the Code
and applicable Treasury Regulations) that is not described in clauses (i), (ii)
or (iii) of

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this sentence (each such event is referred to herein as a "Corporate Change"),
then (x) except as otherwise provided in an Option Agreement or as a result of
the Board's effectuation of one or more of the alternatives described below,
there shall be no acceleration of the time at which any Option then outstanding
may be exercised, and (y) no later than ten (10) days after the approval by the
stockholders of the Company of such Corporate Change, the Board, acting in its
sole and absolute discretion without the consent or approval of any Optionee,
shall act to effect one or more of the following alternatives, which may vary
among individual Optionees and which may vary among Options held by any
individual Optionee:

            (1) accelerate the time at which some or all of the Options then
      outstanding may be exercised so that such Options may be exercised in full
      for a limited period of time on or before a specified date (before or
      after such Corporate Change) fixed by the Board, after which specified
      date all such Options that remain unexercised and all rights of Optionees
      thereunder shall terminate,

            (2) require the mandatory surrender to the Company by all or
      selected Optionees of some or all of the then outstanding Options held by
      such Optionees (irrespective of whether such Options are then exercisable
      under the provisions of this Plan or the Option Agreements evidencing such
      Options) as of a date, before or after such Corporate Change, specified by
      the Board, in which event the Board shall thereupon cancel such Options
      and the Company shall pay to each such Optionee an amount of cash per
      share equal to the excess, if any, of the per share price offered to
      stockholders of the Company in connection with such Corporate Change over
      the exercise price(s) under such Options for such shares,

            (3) with respect to all or selected Optionees, have some or all of
      their then outstanding Options (whether vested or unvested) assumed or
      have a new Option substituted for some or all of their then outstanding
      Options (whether vested or unvested) by an entity which is a party to the
      transaction resulting in such Corporate Change and which is then employing
      him, or a parent or subsidiary of such entity, provided that (A) such
      assumption or substitution is on a basis where the excess of the aggregate
      fair market value of the shares subject to the Option immediately after
      the assumption or substitution over the aggregate exercise price of such
      shares is equal to the excess of the aggregate fair market value of all
      shares subject to the Option immediately before such assumption or
      substitution over the aggregate exercise price of such shares, and (B) the
      assumed rights under such existing Option or the substituted rights under
      such new Option as the case may be will have the same terms and conditions
      as the rights under the existing Option assumed or substituted for, as the
      case may be,

            (4) provide that the number and class of shares of Stock covered by
      an Option (whether vested or unvested) theretofore granted shall be
      adjusted so that such Option when exercised shall thereafter cover the
      number and class of shares of stock or other securities or property
      (including, without limitation, cash) to which the Optionee would have
      been entitled pursuant to the terms of the agreement and/or plan relating
      to such Corporate Change if, immediately prior to such Corporate Change,
      the Optionee had been the holder of record of the number of shares of
      Stock then covered by such Option, or

<PAGE>

            (5) make such adjustments to Options then outstanding as the Board
      deems appropriate to reflect such Corporate Change (provided, however,
      that the Board may determine in its sole and absolute discretion that no
      such adjustment is necessary).

            In effecting one or more of alternatives (3), (4) or (5) above, and
except as otherwise may be provided in an Option Agreement, the Board, in its
sole and absolute discretion and without the consent or approval of any
Optionee, may accelerate the time at which some or all Options then outstanding
may be exercised.

            In the event of changes in the outstanding Stock by reason of
recapitalizations, reorganizations, mergers, consolidations, combinations,
exchanges or other relevant changes in capitalization occurring after the date
of the grant of any Option and not otherwise provided for by this Section 4.5,
any outstanding Options and any agreements evidencing such Options shall be
subject to adjustment by the Board in its sole and absolute discretion as to the
number and price of shares of stock or other consideration subject to such
Options. In the event of any such change in the outstanding Stock, the aggregate
number of shares available under this Plan may be appropriately adjusted by the
Board, whose determination shall be conclusive.

            The issue by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, for cash or property,
or for labor or services either upon direct sale or upon the exercise of rights
or warrants to subscribe for them, or upon conversion of shares or obligations
of the Company convertible into shares or other securities, shall not affect,
and no adjustment by reason of such issuance shall be made with respect to, the
number, class, or price of shares of Stock then subject to outstanding Options.

      18. TERMINATION AND AMENDMENT OF PLAN.

      (a) The Board may amend, terminate or suspend the Plan at any time and
from time to time, in its sole and absolute discretion, in whole or in part;
provided, however, that any amendment which must be approved by the shareholders
of the Company in order to comply with applicable law or the rules of the
principal national securities exchange upon which the shares of Stock are traded
or quoted, shall not be effective unless and until such approval has been
obtained. Presentation of this Plan or any amendment hereof for shareholder
approval shall not be construed to limit the Company's authority to offer
similar or dissimilar benefits under other plans without shareholder approval.

      (b) The Board shall not, without the further approval of the shareholders
of the Company, authorize the amendment of any outstanding Option to reduce the
option price. Furthermore, no Option shall be canceled and replaced with awards
having a lower option price without further approval of the shareholders of the
Company. This Section is intended to prohibit the unlimited repricing of
"underwater" Options without the further approval of the shareholders of the
Company and shall not be construed to prohibit the adjustments provided for in
Section 17 of this Plan.

      19. WRITTEN AGREEMENT. Each Option granted hereunder shall be embodied in
a written agreement, which shall be subject to the terms and conditions of this
Plan and shall be signed by the Optionee and by the

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Chairman of the Board, the Vice Chairman, the President or any Vice President of
the Company for and in the name and on behalf of the Company.

      20. INDEMNIFICATION OF BOARD. With respect to administration of the Plan,
the Company shall indemnify each present and future member of the Board of
Directors against, and each member of the Board of Directors shall be entitled
without further act on his part to indemnity from the Company for, all expenses
(including the amount of judgments and the amount of approved settlements made
with a view to the curtailment of costs of litigation, other than amounts paid
to the Company itself) reasonably incurred by him in connection with or arising
out of any action, suit, or proceeding in which he may be involved by reason of
his being or having been a member of the Board of Directors, whether or not he
continues to be a member of the Board of Directors at the time of incurring the
expenses. However, this indemnity shall not include any expenses incurred by any
member of the Board of Directors (a) in respect of matters as to which he shall
be finally adjudged in any action, suit or proceeding to have been guilty of
gross negligence or willful misconduct in the performance of his duty as a
member of the Board of Directors, or (b) in respect of any matter in which any
settlement is effected, to an amount in excess of the amount approved by the
Company on the advice of its legal counsel. In addition, no right of
indemnification under this Plan shall be available to or enforceable by any
member of the Board of Directors unless, within 60 days after institution of any
action, suit or proceeding, he shall have offered the Company, in writing, the
opportunity to handle and defend same at its own expense. This right of
indemnification shall inure to the benefit of the heirs, executors or
administrators of each member of the Board of Directors and shall be in addition
to all other rights to which a member of the Board of Directors may be entitled
as a matter of law, contract, or otherwise.

      21. FORFEITURES. Notwithstanding any other provision of this Plan, if,
before or after termination of the Optionee's capacity as a director of the
Company, there is an adjudication by a court of competent jurisdiction that the
Optionee committed fraud, embezzlement, theft, commission of felony, or proven
dishonesty in the course of his advisory relationship to the Company and its
affiliates which conduct materially damaged the Company or its affiliates, or
disclosed trade secrets of the Company or its affiliates, then any outstanding
options which have not been exercised by Optionee shall be forfeited. In order
to provide the Company with an opportunity to enforce this Section, an Option
may not be exercised if a lawsuit alleging that an action described in the
preceding sentence has taken place until a final resolution of the lawsuit
favorable to the Optionee.

      22. RESTRICTED STOCK AWARDS. Subject to the provisions of this Plan, the
Board may issue, to any Eligible Director, shares of "Restricted Stock" (which
may be referred to as "Restricted Shares"), namely shares of Stock subject to
restrictions to be set out in an agreement between the Company and the Eligible
Director entered into pursuant to this Plan ("Restricted Stock Agreement"). The
terms and conditions of the Restricted Stock Agreement shall be determined by
the Board consistent with the terms of this Plan and shall conform to the
signature requirements of Section 10. In the discretion of the Board, an award
of Restricted Stock may be made as a grant of Restricted Shares or as a right to
receive Stock (or its cash equivalent or a combination of both) in the future.

      (a) Limitation on Awards of Restricted Stock.

            (1) In any calendar year, an Eligible Director may be awarded
Restricted Shares regardless whether he or she is granted an Option in that
year. However, the sum of (i) the number of Restricted Shares so

<PAGE>

awarded, plus (ii) the number of shares of Stock subject to such Option, if any,
may not exceed the maximum Option size (in number of shares) that may be granted
to such Eligible Director in that calendar year under Section 7. EXAMPLE: If an
Eligible Director receives an Annual Grant of an Option to purchase 20,000
shares of Stock in a particular calendar year, then in that year he or she may
be awarded up to, but not more than, 5,000 Restricted Shares, so that his or her
total for the year does not exceed the 25,000-share limit on Annual Grants in
Section 7.

            (2) The sum of (i) the aggregate number of Restricted Shares awarded
under this Plan, plus (ii) the aggregate number of shares of Stock subject to
Options granted under this Plan, may not exceed the number of Shares reserved
for issuance under Section 4. EXAMPLE: If Options have been granted to Eligible
Directors to purchase an aggregate of 750,000 Shares, then no more than an
aggregate of 250,000 Restricted Shares may be issued to Eligible Directors, so
that the total does not exceed the 1,000,000 Shares dedicated for issuance under
this Plan in Section 4.

      (b) Pricing of Restricted Shares. Restricted Shares may be issued to an
Eligible Director for no payment, or for a payment at, above, or below the Fair
Market Value on the date of grant, in any case as determined by the Board.

      (c) Stock Certificate. Restricted Shares shall be registered in the name
of the Eligible Director receiving the Restricted Shares and deposited, together
with a stock power endorsed in blank, with the Company. Each such certificate
shall bear a legend in substantially the following form:

              The transferability of this certificate and the shares of Stock
              represented by it is restricted by and subject to the terms and
              conditions (including conditions of forfeiture) contained in the
              BindView Development Corporation Non-Employee Director Incentive
              Plan, and an agreement entered into between the registered owner
              and the Company, including any shareholders agreement. A copy of
              the Plan and agreement is on file in the office of the Secretary
              of the Company.

      (d) Restrictions. Restricted Shares shall be subject to such restrictions
on sale, transfer, alienation, pledge or other encumbrance as are specified in
the Restricted Stock Agreement. Such restrictions shall include without
limitation the following, regardless whether expressly set forth in the
Restricted Stock Agreement:

            (1) a prohibition against the sale, transfer, alienation, pledge or
other encumbrance of the Restricted Shares, except that any Restricted Shares
that are subject to such prohibition may nevertheless be transferred in the same
manner as Options under Section 12. Such prohibition shall lapse in the same
way(s) and on the same schedule(s) (including without limitation any automatic
or discretionary accelerated vesting), as though an Option for the same number
of Shares had been granted on the same date as the issuance of the Restricted
Shares; and

            (2) a requirement that the Eligible Director forfeit Restricted
Shares (or, if purchased by the Eligible Director, resell Restricted Shares back
to the Company at cost) in any circumstance in which an Option,

<PAGE>

granted on the same date as the issuance of the Restricted Shares, would either
(i) cease to be an exercisable Option by reason of termination of such Option
under this Plan, or (ii) be forfeited under this Plan.

   No award of Restricted Shares may provide for restrictions continuing beyond
10 years from the date of the award.

      (e) Lapse of Restrictions.

            (1) At the end of the time period during which any Restricted Shares
are subject to forfeiture or restrictions on sale, transfer, alienation, pledge,
or other encumbrance, such Restricted Shares shall vest and will be delivered in
a certificate, free of all restrictions, to the Eligible Director or to the
Eligible Director's legal representative, beneficiary or heir; provided the
certificate shall bear such legend, if any, as the Committee determines is
reasonably required by applicable law. By accepting a Stock Award and executing
a Restricted Stock Agreement, the Employee agrees to remit when due any federal,
state or local taxes of any kind required by law to be withheld with respect to
a delivery of Stock under the Plan. The Company, to the extent permitted or
required by law, shall have the right to deduct from any payment of any kind
(including normal directors fees) otherwise due to a grantee, an amount equal to
any federal, state or local taxes of any kind required by law to be withheld
with respect to any delivery of Stock under the Plan.

            (2) If an Eligible Director who holds Restricted Shares shall cease
to be a member of the Board by reason of disability or death, then any
restrictions on such Restricted Shares shall automatically lapse, subject to any
specific restrictions stated in the Restricted Stock Agreement.

      (f) Rights as Stockholder. Subject to the terms and conditions of this
Plan, each Eligible Director receiving a certificate for Restricted Shares shall
have all the rights of a stockholder with respect to the Restricted Shares
during any period in which such Restricted Shares are subject to forfeiture or
restrictions on transfer, including without limitation, the right to vote such
Shares. Any dividends paid with respect to such Restricted Shares, in cash or
property (other than stock in the Company or rights to acquire stock in the
Company) shall be paid to such Eligible Director currently. Dividends paid in
stock in the Company or rights to acquire stock in the Company shall be added to
and become a part of the Restricted Shares.

      (g) Section 83(b) Election. If a grantee makes an election under Section
83(b) of the Code, or any successor section thereto, to be taxed with respect to
Restricted Shares as of the date of transfer of the Restricted Shares rather
than as of the date or dates upon which the grantee would otherwise be taxable
under Section 83(a) of the Code, the grantee shall deliver a copy of such
election to the Company immediately after filing such election with the Internal
Revenue Service.

      (h) Other Plan Provisions Applicable. All other provisions of this Plan,
not inconsistent with subparagraphs (a) through (g) of this Section 22, shall
apply in respect of Restricted Shares, mutatis mutandis.

<PAGE>

      23. GENDER. If the context requires, words of one gender when used in this
Plan shall include the others and words used in the singular or plural shall
include the other.

      24. HEADINGS. Headings are included for convenience of reference only and
do not constitute part of the Plan and shall not be used in construing the terms
of the Plan.

      25. GOVERNING LAW. The provisions of this Plan shall be construed,
administered, and governed under the laws of the State of Texas.

                                      # # #<PAGE>
                                                                  EXHIBIT 10.A.2

                                                                  EXECUTION COPY

--------------------------------------------------------------------------------

                                  SECOND WAIVER

                                       TO

                    $3,000,000,000 REVOLVING CREDIT AGREEMENT

                            DATED AS OF JUNE 15, 2004

                                      AMONG

                EL PASO CORPORATION, EL PASO NATURAL GAS COMPANY,
              TENNESSEE GAS PIPELINE COMPANY, ANR PIPELINE COMPANY
                      AND COLORADO INTERSTATE GAS COMPANY,
                                  AS BORROWERS,

                            THE LENDERS PARTY HERETO,

                                       AND

                              JPMORGAN CHASE BANK,
                             AS ADMINISTRATIVE AGENT

              ABN AMRO BANK N.V. AND CITICORP NORTH AMERICA, INC.,
                           AS CO-DOCUMENTATION AGENTS

              BANK OF AMERICA, N.A. AND CREDIT SUISSE FIRST BOSTON,
                            AS CO-SYNDICATION AGENTS

--------------------------------------------------------------------------------

<PAGE>

                                                                  EXECUTION COPY

                                  SECOND WAIVER
                  TO $3,000,000,000 REVOLVING CREDIT AGREEMENT

      This SECOND WAIVER TO $3,000,000,000 REVOLVING CREDIT AGREEMENT (this
"Second Waiver") dated as of June 15, 2004, is by and among EL PASO CORPORATION,
a Delaware corporation (the "Company"), EL PASO NATURAL GAS COMPANY, a Delaware
corporation ("EPNGC"), TENNESSEE GAS PIPELINE COMPANY, a Delaware corporation
("TGPC"), ANR PIPELINE COMPANY, a Delaware corporation ("ANR"), COLORADO
INTERSTATE GAS COMPANY, a Delaware corporation, the several banks and other
financial institutions signatories hereto, JPMORGAN CHASE BANK, as
Administrative Agent (the "Administrative Agent"), ABN AMRO BANK N.V. and
CITICORP NORTH AMERICA, INC., as Co-Documentation Agents, and BANK OF AMERICA,
N.A. and CREDIT SUISSE FIRST BOSTON, as Co-Syndication Agents, and is in
connection with $3,000,000,000 Revolving Credit Agreement, dated as of April 16,
2003, as amended by that certain First Amendment to $3,000,000,000 Revolving
Credit Agreement and Waiver (the "First Amendment") dated as of March 15, 2004
(as so amended, the "Credit Agreement"), by and among the Company, EPNGC, TGPC,
ANR, the several banks and other financial institutions party thereto (the
"Lenders"), the Administrative Agent, the Co-Documentation Agents and the
Co-Syndication Agents. Each term defined in the Credit Agreement (as amended
hereby) and not otherwise defined herein shall have the meaning assigned to such
term in the Credit Agreement. Unless otherwise indicated, all section and
article references in this Second Waiver refer to the Credit Agreement.

                                    RECITALS:

      WHEREAS, the Company requested, and the Majority Lenders granted, certain
modifications and waivers pursuant to the First Amendment, in connection with
the Company's Reserve Reduction (as such term is defined in such First
Amendment), its inability to timely file its annual report on Form 10-K,
including its financial statements for the year ended December 31, 2003, with
the Securities and Exchange Commission and its inability to deliver such annual
report and such financial statements to the Lenders within 120 days after such
year end as required by Section 5.08(b) of the Credit Agreement.

      WHEREAS, the Company anticipates that it will be unable to file its annual
report on Form 10-K, including its financial statements for the year ended
December 31, 2003, with the Securities and Exchange Commission or deliver the
same to the Lenders, prior to the expiration of the waiver relating to Section
5.08(b) of the Credit Agreement as set forth in the First Amendment.

      WHEREAS, the Company was unable to timely file its quarterly report on
Form 10-Q, including its financial statements for the quarter ended March 31,
2004, with the Securities and Exchange Commission and consequently was unable to
timely deliver such quarterly report and such financial statements to the
Lenders as required by Section 5.08(a) of the Credit Agreement.

      WHEREAS, the Company has requested that the Administrative Agent and the
Lenders waive its failure to comply with Section 5.08(a) and continue to waive
the failure to comply with Section 5.08(b), together with the related Events of
Default under the Credit Agreement that may result from the Company's failure to
deliver such annual and quarterly reports to the Lenders.

<PAGE>

                                                                  EXECUTION COPY

                                   AGREEMENT:

      In consideration of the premises and the mutual covenants contained herein
and in the Credit Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:

      Section 1. Waivers. The Administrative Agent and the Lenders hereby waive
each of the following:

            (a) compliance by the Company with the affirmative covenant
contained in Section 5.08(a) of the Credit Agreement, insofar as such covenant
requires that the unaudited financial statements for the Company and its
consolidated Subsidiaries required to be delivered thereunder for the fiscal
quarter ended March 31, 2004, must be delivered to each Lender within 60 days
after March 31, 2004, together with an accompanying certificate of the chief
financial officer, controller or treasurer of the Company; provided that such
waiver shall expire upon the earliest to occur of the following (the "Waiver
Expiration"):

                  (i) August 14, 2004;

                  (ii) the date upon which the Company or any Significant
Subsidiary shall receive notice from the holder or holders under any Material
Indebtedness, or from any Person or Persons authorized to deliver such notice on
behalf of such holder or holders, of an Unmatured Default;

                  (iii) the date on which the Company or any Significant
Subsidiary shall be required to provide notice to the holder or holders of any
Material Indebtedness, or to any other Person or Persons authorized to receive
such notice on behalf of such holder or holders, of an Unmatured Default which
would become a Matured Default upon the lapse of time without any further action
by any Person;

                  (iv) the date on which the Company or any Significant
Subsidiary has knowledge of, or should have had knowledge of, an Unmatured
Default (other than an Excepted Default) under any Material Indebtedness if the
effect of such knowledge by such Person is that such Unmatured Default would
become a Matured Default upon the lapse of time without any further action by
any Person;

                  (v) the date upon which a Matured Default with respect to any
Material Indebtedness (other than an Excepted Default) first exists; and

                  (vi) the date upon which the Company or any Excepted
Subsidiary shall have received with respect to an Excepted Default either a
"Default Notice" pursuant to Section 9.01(x) of the Excepted Subsidiary
Indenture or a notice of acceleration pursuant to Section 9.01(y) of the
Excepted Subsidiary Indenture;

and provided further, that if the Waiver Expiration occurs prior to compliance
by the Company with Section 5.08(a), then, notwithstanding the grace period
provided for in Article VII(d), the Default arising out of the Company's failure
to so comply with Section 5.08(a) shall become an Event of Default if such
Default remains unremedied for twenty-nine (29) days after the date of the
Waiver Expiration and this Second Waiver shall constitute written notice of such
Default to

                                        2
<PAGE>

                                                                  EXECUTION COPY

the Company for purposes of Article VII(d) and such written notice shall be
deemed to be received by the Company as of the date of the Waiver Expiration;

            (b) compliance by the Company with the affirmative covenants
contained in Sections 5.08(b) and (c) of the Credit Agreement, insofar as such
covenants require that the audited financial statements for the Company and its
consolidated Subsidiaries required to be delivered thereunder for the fiscal
year ended December 31, 2003, must be delivered to each Lender within 120 days
after December 31, 2003, together with an accompanying certificate of the chief
financial officer, controller or treasurer of the Company; provided that such
waiver shall expire on the Waiver Expiration; and provided further, that if the
Waiver Expiration occurs prior to compliance by the Company with Sections
5.08(b) and (c), then, notwithstanding the grace period provided for in Article
VII(d), the Defaults arising out of the Company's failure to so comply with
Sections 5.08(b) and (c) shall each become an Event of Default if such Default
remains unremedied for twenty-nine (29) days after the date of the Waiver
Expiration and this Second Waiver shall constitute written notice of such
Defaults to the Company for purposes of Article VII(d) and such written notice
shall be deemed to be received by the Company as of the date of the Waiver
Expiration;

            (c) if the Waiver Expiration occurs prior to the compliance by the
Company with the affirmative covenants contained in Sections 5.08(a), (b) or (c)
for the fiscal periods ending December 31, 2003 and March 31, 2004, and with
respect only to a renewal or extension of any Letter of Credit issued by an
Issuing Bank prior to the date of the Waiver Expiration, the condition set forth
in Section 3.03(b) insofar as, and for as long as, such condition is not
satisfied because of the existence and continuation of a Default or Event of
Default arising out of the Company's failure to comply with Sections 5.08(a),
(b) or (c) with respect to the fiscal periods ending December 31, 2003 and March
31, 2004.

            (d) For purposes of this Section 1 and the other provisions of this
Second Waiver, the following terms shall have the meanings set forth below:

                  (i)   "Excepted Default" means an event or condition that
could or has become an "Event of Default" pursuant to the provisions of Sections
9.01(c) and (d) of the Excepted Subsidiary Indenture.

                  (ii)  "Excepted Subsidiary" means either of Gemstone Investor
Limited or Gemstone Investor, Inc.

                  (iii) "Excepted Subsidiary Indenture" means the Indenture
dated as of May 9, 2002 among the Excepted Subsidiaries, as issuers, The Bank of
New York, as the New Indenture Trustee, and the Company, as guarantor, pursuant
to which the Excepted Subsidiaries' 7.71% Guaranteed Senior Unsecured Notes due
2004 were issued.

                  (iv) "Material Indebtedness" means any Debt or Guaranty of the
Company or any Significant Subsidiary in an aggregate principal amount of
$100,000,000 or more.

                  (v)  "Matured Default" means any event or condition which
allows the holder or holders of any Material Indebtedness to accelerate the
maturity of such Material Indebtedness.

                                       3
<PAGE>

                                                                  EXECUTION COPY

                  (vi)  "Significant Subsidiary" means (i) each Subsidiary of
the Company that would be a "significant subsidiary" of the Company within the
meaning of Rule 1-02 under Regulation S-X promulgated by the Securities and
Exchange Commission and (ii) each of the Credit Related Parties, El Paso CGP
Company, Gemstone Investor Limited, Gemstone Investor, Inc. and El Paso
Production Holding Company.

                  (vii) "Unmatured Default" means any event or condition which,
with notice or lapse of time or both, allows the holder or holders of any
Material Indebtedness to accelerate the maturity of such Material Indebtedness.

      Section 2. Limitations. The waivers set forth herein are limited precisely
as written and shall not (a) be deemed to be a waiver or modification of any
other term or condition of the Credit Agreement (including, but not limited to,
any other Default or Event of Default under the Credit Agreement arising out of
the same factual predicate as the Defaults waived herein in Sections 1(a) and
(b)) or (b) except as expressly set forth herein, prejudice any right or rights
which the Lenders may now have or may have in the future under or in connection
with the Credit Agreement or any of the other documents or instruments referred
to therein. Except as expressly modified hereby or by express written amendments
thereof, the Credit Agreement and each of the other Loan Documents and
instruments executed in connection with any of the foregoing are and shall
remain in full force and effect. In the event of a conflict between this Second
Waiver and any of the foregoing documents, the terms of this Second Waiver shall
be controlling.

      Section 3. Effectiveness. This Second Waiver shall become effective as of
June 15, 2004, if on or prior to that date the following conditions have been
satisfied or waived: (a) the Administrative Agent shall have received this
Second Waiver, executed and delivered by each Borrower, the Administrative Agent
and the Majority Lenders, (b) each Guarantor other than the Company shall have
executed and delivered an acknowledgment and consent to this Second Waiver
substantially in the form of Exhibit A hereto, (c) except for Excepted Defaults,
no Matured Default exists and is continuing and (d) the Administrative Agent
shall have received evidence satisfactory to it that any default or event of
default under the Financing Documents (including any Company Project Support
Document or any Company Reimbursement Document (as such term is defined in
Appendix A-1 to the Security and Intercreditor Agreement)) for (i) the Lakeside
Underlying Transaction (as defined on Schedule 1 attached hereto) and (ii) each
of the Additional Covered Letters of Credit (as described on Schedule 1 attached
hereto) arising from the failure of the Company to timely deliver its financial
statements has been waived, cured or otherwise remedied.

      Section 4. Representations and Warranties. The Company hereby represents
and warrants to the Administrative Agent and each of the Lenders that:

            (a) each of the representations and warranties made by the Company
or its Subsidiaries in or pursuant to the Credit Agreement and the other Loan
Documents (excluding Section 4.05 of the Credit Agreement) is true and correct
in all material respects as of the date hereof, as if made (after giving effect
to this Second Waiver) on and as of such date, except for any representations
and warranties made as of a specified date, which are true and correct in all
material respects as of such specified date;

                                       4
<PAGE>

                                                                  EXECUTION COPY

            (b) after giving effect to this Second Waiver, no Default or Event
of Default has occurred and is continuing as of the date hereof;

            (c) except for the obligations set forth on Schedule 2 attached
hereto, there is no credit agreement, instrument, guarantee, bond, indentures or
similar document or agreement with respect to Debt or Guarantees of the Company
or any Significant Subsidiary in aggregate principal amount of $50,000,000 or
more under which an Unmatured Default or Matured Default will occur from a
breach of the obligation of the relevant obligor thereunder or the Company to
deliver financial statements for the year ended December 31, 2003 or for the
fiscal period ended March 31, 2004, within any applicable time period required
by such documents or agreements.

            (d) for the period commencing March 30, 2004 to and including June
15, 2004, neither the Company nor any Significant Subsidiary has (i) been
required to provide a notice with respect to any Unmatured Default, (ii)
received notice from any Person with respect to any Unmatured Default or (iii)
acquired knowledge of any Unmatured Default; provided, however, that the
representations made in the foregoing clauses (i) and (iii) are not made as to
any Excepted Default.

            (e) no Matured Default exists and is continuing; provided, however,
that no such representation is made as to any Excepted Default.

      Section 5. Covenant Regarding Coastal Petrochemical. The Company hereby
agrees to (a) use its commercially reasonable efforts to obtain a waiver with
respect to any event or condition which constitutes an event of default or which
upon notice, lapse of time or both would, unless cured or waived, become an
event of default under the Financing Documents (including any Company Project
Support Document) for the Coastal Petrochemical Underlying Transaction arising
from the failure of the Company to timely deliver its financial statements and
(b) to promptly provide a certified copy of any such waiver to the
Administrative Agent.

      Section 6. Covenant to Deliver Notice of Waiver Expiration. The Company
hereby covenants to deliver written notice to the Administrative Agent of the
Waiver Expiration promptly upon the occurrence thereof and, if applicable, a
copy of each notice with respect to any Unmatured Default, whether required to
be provided by the Company or any Significant Subsidiary or received by the
same, promptly upon either the receipt thereof or the delivery thereof by the
Company or such Significant Subsidiary.

      Section 7. Adoption, Ratification and Confirmation of Loan Documents. The
Company and each of the Pipeline Company Borrowers hereby adopts, ratifies and
confirms the Loan Documents, as amended hereby, and acknowledges and agrees that
the Loan Documents, as amended hereby, are and remain in full force and effect.

      Section 8. Governing Law. THIS SECOND WAIVER AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND
BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

      Section 9. Descriptive Headings, Etc. The descriptive headings of the
several sections of this Second Waiver are inserted for convenience only and
shall not be deemed to affect the meaning or construction of any of the
provisions hereof. The statements made and the

                                       5
<PAGE>

                                                                  EXECUTION COPY

terms defined in the recitals to this Second Waiver are hereby incorporated into
this Second Waiver in their entirety.

      Section 10. Payment of Expenses and Deferred Waiver Fees. The Company
agrees to pay or reimburse the Administrative Agent for all of its out-of-pocket
costs and reasonable expenses incurred in connection with this Second Waiver,
any other documents prepared in connection herewith and the transactions
contemplated hereby, including, without limitation, the reasonable fees and
disbursements of counsel to the Administrative Agent. If the Company has not
complied in all respects with the covenants of Sections 5.08(a), (b) and (c) of
the Credit Agreement as of July 15, 2004, then the Company agrees to pay on July
16, 2004, to each Lender that is a signatory to this Second Waiver a deferred
waiver fee in an amount equal to 0.05% of the Commitment of such Lender, such
waiver fee constituting an Obligation under the Credit Agreement.

      Section 11. Entire Agreement. This Second Waiver and the documents
referred to herein represent the entire understanding of the parties hereto
regarding the subject matter hereof and supersede all prior and contemporaneous
oral and written agreements of the parties hereto with respect to the subject
matter hereof.

      Section 12. Counterparts. This Second Waiver may be executed in any number
of counterparts (including by telecopy) and by different parties on separate
counterparts and all of such counterparts shall together constitute one and the
same instrument.

      Section 13. Successors. The execution and delivery of this Second Waiver
by any Lender shall be binding upon each of its successors and assigns
(including transferees of its Commitment and Loans in whole or in part prior to
the effectiveness hereof) and binding in respect of all of its Commitment and
Loans.

         [Signature Pages to this Second Waiver Begin on the Next Page]

                                       6
<PAGE>

                                                                  EXECUTION COPY

      In Witness Whereof, the parties hereto have caused this Second Waiver to
be duly executed and delivered by their respective duly authorized officers as
of the date first written above.

THE COMPANY:                    EL PASO CORPORATION

                                By: /s/ John J. Hopper
                                    -----------------------------------------
                                    Name: John J. Hopper
                                    Title: Vice President and Treasurer

PIPELINE COMPANY BORROWERS:

                                EL PASO NATURAL GAS COMPANY

                                By: /s/ Greg G. Gruber
                                    -----------------------------------------
                                    Name: Greg G. Gruber
                                    Title: Senior Vice President,
                                           Chief Financial Officer and Treasurer

                                TENNESSEE GAS PIPELINE COMPANY

                                By: /s/ Greg G. Gruber
                                    -----------------------------------------
                                    Name: Greg G. Gruber
                                    Title: Senior Vice President,
                                           Chief Financial Officer and Treasurer

                                ANR PIPELINE COMPANY

                                By: /s/ Greg G. Gruber
                                    -----------------------------------------
                                    Name: Greg G. Gruber
                                    Title: Senior Vice President,
                                           Chief Financial Officer and Treasurer

                                COLORADO INTERSTATE GAS COMPANY

                                By: /s/ Greg G. Gruber
                                    -----------------------------------------
                                    Name: Greg G. Gruber
                                    Title: Senior Vice President,
                                           Chief Financial Officer and Treasurer

                        Signature Page 1 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

ADMINISTRATIVE AGENT:           JPMORGAN CHASE BANK, individually and as
                                Administrative Agent

                                By: /s/ Peter M. Ling
                                    -----------------------------------------
                                    Name: Peter M. Ling
                                    Title: Managing Director

                        Signature Page 2 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

LENDERS:                        ABN AMRO BANK N.V.

                                By: /s/ Frank T. J. van Deur
                                    -----------------------------------------
                                    Name: Frank T. J. van Deur
                                    Title: Vice President

                                By: /s/ Stephanie B. Casas
                                    -----------------------------------------
                                    Name: Stephanie B. Casas
                                    Title: Vice President

                        Signature Page 3 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                CITICORP NORTH AMERICA, INC.

                                By: /s/ Amy Pincu
                                    -----------------------------------------
                                    Name: Amy Pincu
                                    Title: Director

                        Signature Page 4 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                BANK OF AMERICA, N.A.

                                By: /s/ Patrick Honey
                                    -----------------------------------------
                                    Name: Patrick Honey
                                    Title: Principal

                        Signature Page 5 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                CREDIT SUISSE FIRST BOSTON, ACTING THROUGH
                                ITS CAYMAN ISLANDS BRANCH

                                By: /s/ James P. Moran
                                    -----------------------------------------
                                    Name: James P. Moran
                                    Title: Director

                                By: /s/ Denise L. Alvarez
                                    -----------------------------------------
                                    Name: Denise L. Alvarez
                                    Title: Associate

                        Signature Page 6 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                THE BANK OF NOVA SCOTIA

                                By: /s/  Nadine Bell
                                    -----------------------------------------
                                    Name: Nadine Bell
                                    Title: Senior Manager

                        Signature Page 7 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                HVB AG, NEW YORK BRANCH

                                By: /s/ Loriann Curnyn
                                    -----------------------------------------
                                    Name: Loriann Curnyn
                                    Title: Managing Director

                                By: /s/ Shannon Batchman
                                    -----------------------------------------
                                    Name: Shannon Batchman
                                    Title: Director

                        Signature Page 8 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                BNP PARIBAS

                                By: /s/ Mark A. Cox
                                    -----------------------------------------
                                    Name: Mark A. Cox
                                    Title: Director

                                By: /s/ Greg Smothers
                                    -----------------------------------------
                                    Name: Greg Smothers
                                    Title: Vice President

                        Signature Page 9 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                DEUTSCHE BANK AG NEW YORK BRANCH

                                By: /s/ Joel Makowsky
                                    -----------------------------------------
                                    Name: Joel Makowsky
                                    Title: Director

                                By: /s/ Richard Henshall
                                    -----------------------------------------
                                    Name: Richard Henshall
                                    Title: Director

                        Signature Page 10 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                SOCIETE GENERALE

                                By: /s/  Stephen W. Warfel
                                    -----------------------------------------
                                    Name: Stephen W. Warfel
                                    Title: Vice President

                        Signature Page 11 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                MIZUHO CORPORATE BANK, LTD.

                                By: /s/ Noel Purcell
                                    -----------------------------------------
                                    Name: Noel Purcell
                                    Title: SVP & Dept. Head

                       Signature Page 12 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                THE BANK OF NEW YORK

                                By: /s/ Lizanne T. Eberle
                                    -----------------------------------------
                                    Name: Lizanne T. Eberle
                                    Title: Vice President

                       Signature Page 13 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                CALYON NEW YORK BRANCH

                                By: /s/  Olivier Audemand
                                    -----------------------------------------
                                    Name: Olivier Audemand
                                    Title: Managing Director

                       Signature Page 14 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                MELLON BANK, N.A.

                                By: /s/ Gary A. Saul
                                    -----------------------------------------
                                    Name: Gary A. Saul
                                    Title: First Vice President

                       Signature Page 15 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                THE BANK OF TOKYO-MITSUBISHI, LTD HOUSTON AGENCY

                                By: /s/ Kelson Glasscock
                                    -----------------------------------------
                                    Name: Kelson Glasscock
                                    Title: Vice President & Manager

                                By: /s/ Jay Fort
                                    -----------------------------------------
                                    Name: Jay Fort
                                    Title: Vice President

                       Signature Page 16 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                BANK ONE, NA (MAIN OFFICE CHICAGO)

                                By: /s/  Hal E. Fudge
                                    -----------------------------------------
                                    Name: Hal E. Fudge
                                    Title: First Vice President

                       Signature Page 17 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                LEHMAN COMMERCIAL PAPER INC.

                                By: /s/ Janine M. Shugan
                                    -----------------------------------------
                                    Name: Janine M. Shugan
                                    Title: Authorized Signatory

                       Signature Page 18 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                ROYAL BANK OF CANADA

                                By: /s/ Raymond S. Chang
                                    -----------------------------------------
                                    Name: Raymond S. Chang
                                    Title: Vice President

                       Signature Page 19 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                KBC BANK N.V.

                                By: /s/ Robert Snauffer
                                    -----------------------------------------
                                    Name: Robert Snauffer
                                    Title: First Vice President

                                By: /s/ Eric Raskin
                                    -----------------------------------------
                                    Name: Eric Raskin
                                    Title: Vice President

                       Signature Page 20 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                NORDDEUTSCHE LANDESBANK GIROZENTRALE

                                NEW YORK BRANCH AND/OR CAYMAN ISLANDS BRANCH

                                By: /s/ Stephen K. Hunter
                                    -----------------------------------------
                                    Name: Stephen K. Hunter
                                    Title: SVP & Deputy General Manager

                                By: /s/ Stephanie Finnen
                                ---------------------------------------------
                                    Name: Stephanie Finnen
                                    Title: VP

                       Signature Page 21 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                SPECIAL SITUATIONS INVESTING GROUP, INC.

                                By: /s/ Robert S. Fanelli
                                    -----------------------------------------
                                    Name: Robert S. Fanelli
                                    Title: Authorized Signatory

                       Signature Page 22 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                AMARILLO NATIONAL BANK

                                By: /s/ Craig I. Sanders
                                    -----------------------------------------
                                    Name: Craig I. Sanders
                                    Title: Executive Vice President

                       Signature Page 23 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                AKANTHOS ARBITRAGE MASTER FUND LP

                                BY AKANTHOS CAPITAL MGMT LLC, HS GP

                                By: /s/ Michael Kao
                                    -----------------------------------------
                                    Name: Michael Kao
                                    Title: Managing Member

                       Signature Page 24 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                QUADRANGLE MASTER FUNDING LTD

                                By: /s/ Christopher Santana
                                    -----------------------------------------
                                    Name: Christopher Santana
                                    Title: Member

                       Signature Page 25 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                BEAR STEARNS INVESTMENT PRODUCTS INC.

                                By: /s/ Richard Bram Smith
                                    -----------------------------------------
                                    Name: Richard Bram Smith
                                    Title: Vice President

                       Signature Page 26 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                TRS CALLISTO LLC

                                By: /s/ Deborah O'Keefe
                                    -----------------------------------------
                                    Name: Deborah O'Keefe
                                    Title: Vice President

                       Signature Page 27 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                LONGACRE MASTER FUND LTD.

                                By: /s/ Steven Weissman
                                    -----------------------------------------
                                    Name: Steven Weissman
                                    Title: Director

                       Signature Page 28 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                LONGACRE CAPITAL PARTNERS (QP) LP

                                By: /s/ Steven Weissman
                                    -----------------------------------------
                                    Name: Steven Weissman
                                    Title: Member

                       Signature Page 29 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                SATELLITE SENIOR INCOME FUND, LLC

                                By: /s/  Brian S. Kriftcher
                                    -----------------------------------------
                                    Name: Brian S. Kriftcher
                                    Title: Chief Operating Officer & Principal

                       Signature Page 30 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                SATELLITE SENIOR INCOME FUND II, LLC

                                By: /s/  Brian S. Kriftcher
                                    -----------------------------------------
                                    Name: Brian S. Kriftcher
                                    Title: Chief Operating Officer & Principal

                       Signature Page 31 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                OAK HILL SECURITIES FUND, L.P.

                                By: Oak Hill Securities GenPar, L.P.
                                    its General Partner

                                By: Oak Hill Securities MGP, Inc.,
                                    its General Partner

                                By: /s/ Scott D. Krase
                                    -----------------------------------------
                                    Name: Scott D. Krase
                                    Title: Vice President

                       Signature Page 32 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                OAK HILL SECURITIES FUND II, L.P.

                                By: Oak Hill Securities GenPar II, L.P.
                                    its General Partner

                                By: Oak Hill Securities MGP II, Inc.,
                                    its General Partner

                                By: /s/ Scott D. Krase
                                    -----------------------------------------
                                    Name: Scott D. Krase
                                    Title: Vice President

                       Signature Page 33 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                OAK HILL CREDIT ALPHA FUND LP

                                By: Oak Hill Credit Alpha GenPar, L.P.
                                    its General Partner

                                By: Oak Hill Credit Alpha MGP, Inc.,
                                    its General Partner

                                By: /s/ Scott D. Krase
                                    -----------------------------------------
                                    Name: Scott D. Krase
                                    Title: Authorized Person

                       Signature Page 34 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                OAK HILL CREDIT  ALPHA FUND (OFFSHORE) LTD

                                By: /s/ Scott D. Krase
                                    -----------------------------------------
                                    Name: Scott D. Krase
                                    Title: Authorized Person

                       Signature Page 35 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                   SCHEDULE 1

                       WAIVERS REQUIRED FOR EFFECTIVENESS

      1.    Guarantee of the Company relating to the Lakeside Purchasers, dated
            as of May 15, 2001, LLC Synthetic Lease, as amended as of April 16,
            2003 and the Financing Documents related thereto, all as described
            on Part 6 of Schedule II-C of the Security and Intercreditor
            Agreement (the "Lakeside Underlying Transaction").

The remaining items listed in this Part A are herein identified as the
"Additional Covered Letters of Credit":

      2.    Reimbursement obligations of the Company or its Subsidiaries with
            respect to Letter of Credit #00881-30010064 issued by Citibank, N.A.
            for the benefit of Pacific Gas & Electric;

      3.    Reimbursement obligations of the Company or its Subsidiaries with
            respect to Letter of Credit #00880-30024869 issued by Citibank, N.A.
            for the benefit of Bangladesh Power Development Board;

      4.    Reimbursement obligations of the Company or its Subsidiaries with
            respect to Letter of Credit #61610705 issued by Citibank, N.A. for
            the benefit of Citibank Dhaka;

      5.    Reimbursement obligations of the Company or its Subsidiaries with
            respect to Letter of Credit #6160704 issued by Citibank, N.A. for
            the benefit of Citibank New York;

      6.    Reimbursement obligations of the Company or its Subsidiaries with
            respect to Letter of Credit #P-292889 issued by JPMorgan Chase Bank
            for the benefit of ANR Eaton Company;

      7.    Reimbursement obligations of the Company or its Subsidiaries with
            respect to Letter of Credit #P-382682 issued by JPMorgan Chase Bank
            for the benefit of the State of Florida; and

      8.    Reimbursement obligations of the Company or its Subsidiaries with
            respect to Letter of Credit #G390391 issued by Toronto Dominion for
            the benefit of ANP.

                      Page 1 to Schedule 1 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                   SCHEDULE 2

                       LIST OF DEBT & GUARANTY OBLIGATIONS

I.    EL PASO CORPORATION (FORMERLY EL PASO ENERGY CORPORATION) DEBT INSTRUMENTS

      1.    $3,000,000,000 Revolving Credit Agreement dated as of April 16,
            2003, among El Paso Corporation, El Paso Natural Gas Company,
            Tennessee Gas Pipeline Company and ANR Pipeline Company, as
            Borrowers, the lenders party thereto and JPMorgan Chase Bank, as
            Administrative Agent, ABN AMRO Bank, N.V. and Citicorp North
            America, as Co Document Agents, and Bank of America, N.A. and Credit
            Suisse First Boston, as Co-Syndication Agents.

      2.    Indenture dated as of May 10, 1999, between El Paso Energy
            Corporation and The Chase Manhattan Bank (by merger JPMorgan Chase
            Bank and subsequently replaced by HSBC BANK USA)

      3.    Indenture dated as of March 1, 1998 between El Paso Natural Gas
            Company (by assignment now El Paso Corporation) and The Chase
            Manhattan Bank (by merger JPMorgan Chase Bank and subsequently
            replaced by Law Debenture Trust Company of New York)

      4.    Indenture dated as of June 1, 1986, between Sonat Inc. (by merger
            now El Paso Corporation) and Manufacturers Hanover Trust Company (by
            merger JPMorgan Chase Bank and subsequently replaced by HSBC BANK
            USA)

      5.    Indenture dated as of March 30, 1992, between Valero Energy
            Corporation (by merger PG&E Gas Transmission, Texas Corporation,
            then El Paso Gas Transmission Company and now El Paso Corporation)
            and Bankers Trust Company (by merger now Deutsche Bank Trust Company
            Americas)

      6.    Additional Covered Letters of Credit

      (a)   Reimbursement obligations of the Company or its Subsidiaries with
            respect to Letter of Credit #00881-30010064 issued by Citibank, N.A.
            for the benefit of Pacific Gas & Electric;

      (b)   Reimbursement obligations of the Company or its Subsidiaries with
            respect to Letter of Credit #00880-30024869 issued by Citibank, N.A.
            for the benefit of Bangladesh Power Development Board;

      (c)   Reimbursement obligations of the Company or its Subsidiaries with
            respect to Letter of Credit #61610705 issued by Citibank, N.A. for
            the benefit of Citibank Dhaka;

      (d)   Reimbursement obligations of the Company or its Subsidiaries with
            respect to Letter of Credit #6160704 issued by Citibank, N.A. for
            the benefit of Citibank New York;

                      Page 1 to Schedule 2 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

      (e)   Reimbursement obligations of the Company or its Subsidiaries with
            respect to Letter of Credit #P-292889 issued by JPMorgan Chase Bank
            for the benefit of ANR Eaton Company;

      (f)   Reimbursement obligations of the Company or its Subsidiaries with
            respect to Letter of Credit #P-382682 issued by JPMorgan Chase Bank
            for the benefit of the State of Florida; and

      (g)   Reimbursement obligations of the Company or its Subsidiaries with
            respect to Letter of Credit #G390391 issued by Toronto Dominion for
            the benefit of ANP.

      7.    Other Letters of Credit

                        (a) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #NY-93959 issued
                  by Banco Bilbao Vizcaya Argentaria, S.A. for the benefit of
                  ANP;

                        (b) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #NY-93960 issued
                  by Banco Bilbao Vizcaya Argentaria, S.A. for the benefit of
                  ANP;

                        (c) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #P-298274 issued
                  by JPMorgan Chase Bank for the benefit of West Kern;

                        (d) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #P-212605 issued
                  by JPMorgan Chase Bank for the benefit of Twin County;

                        (e) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #P-233719 issued
                  by JPMorgan Chase Bank for the benefit of Protective;

                        (f) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #P-258425 issued
                  by JPMorgan Chase Bank for the benefit of Chevron USA;

                        (g) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #P-233969 issued
                  by JPMorgan Chase Bank for the benefit of General Electric I;

                        (h) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #P-241080 issued
                  by JPMorgan Chase Bank for the benefit of ANP;

                        (i) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #P-770429 issued
                  by JPMorgan Chase Bank for the benefit of Home Insurance;

                      Page 2 to Schedule 2 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                        (j) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #P-393501 issued
                  by JPMorgan Chase Bank for the benefit of the State of
                  Florida;

                        (k) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #P-346269 issued
                  by JPMorgan Chase Bank for the benefit of the State of
                  Florida;

                        (l) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #P-209947 issued
                  by JPMorgan Chase Bank for the benefit of New England Power;

                        (m) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #P-367925 issued
                  by JPMorgan Chase Bank for the benefit of Insurance Company of
                  North America;

                        (n) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #P-226058 issued
                  by JPMorgan Chase Bank for the benefit of the State of
                  Florida;

                        (o) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #P-215470 issued
                  by JPMorgan Chase Bank for the benefit of Travelers;

                        (p) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #A26018T issued
                  by Compass Bank for the benefit of the Texas Commission on
                  Environmental Quality;

                        (q) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #A26048T issued
                  by Compass Bank for the benefit of the New Jersey Department
                  of Environmental Protection;

                        (r) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #A26076T issued
                  by Compass Bank for the benefit of the City of Chicago;

                        (s) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #A26112T issued
                  by Compass Bank for the benefit of the Kansas Department of
                  Health & Environment;

                        (t) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Bank Guarantee #100BGC101248
                  issued by Deutsche Bank AG for the benefit of the Belgian VAT
                  Tax Authority;

                      Page 3 to Schedule 2 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                        (u) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #91874275 issued
                  by BNP Paribas for the benefit of Citibank Dhaka;

                        (v) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #27699 issued by
                  BNP Paribas for the benefit of the California Power Exchange;

                        (w) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #91870940 issued
                  by BNP Paribas for the benefit of DB Trust Company;

                        (x) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #27497 issued by
                  BNP Paribas for the benefit of Florida Gas Transmission;

                        (y) Reimbursement obligations of the Company or its
                  Subsidiaries with respect to Letter of Credit #91871362 issued
                  by BNP Paribas for the benefit of Manaus Energy.

      12.   Guaranty dated October 22, 1999 by El Paso Corporation in favor of
            Meizhou Wan Generating Company Ltd.

      13.   Amended and Restated Guarantee dated as of April 16, 2003, by El
            Paso Corporation in favor of Lakeside Real Estate Trust 2001 for the
            benefit of the Investors, the Lenders and JPMorgan Chase Bank, as
            Administrative Agent for the Lenders.

      14.   El Paso Contingent Guaranty Agreement, dated as of November 2, 2001,
            in favor of Prudential Insurance Company of America.

      15.   Guarantee dated as of March 27, 2002, by El Paso Corporation in
            favor of RFC Caverns, L.P. and GATX Gas Storage Services, Inc.

      16.   Indenture dated as of May 9, 2002, among Gemstone Investor Limited,
            Gemstone Investor, Inc., The Bank of New York, as trustee, and El
            Paso Corporation, as guarantor.

II.   EL PASO CGP COMPANY (FORMERLY THE COASTAL CORPORATION) DEBT INSTRUMENTS

      1.    Indenture dated as of October 1, 1989, between The Coastal
            Corporation and The Bank of New York.

      2.    Indenture dated as of October 1, 1990, between The Coastal
            Corporation and The Bank of New York.

                      Page 4 to Schedule 2 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

      3.    Indenture dated as of May 15, 1992, between The Coastal Corporation
            and Bank of Montreal Trust Company (subsequently replaced by The
            Bank of New York), as supplemented.

      4.    Indenture dated as of September 15, 1992, between The Coastal
            Corporation and NationsBank of Texas, National Association
            (subsequently replaced by The Bank of New York), as supplemented.

      5.    Indenture dated as of February 24, 1997, between The Coastal
            Corporation and Harris Trust and Savings Bank (subsequently replaced
            by The Bank of New York), as supplemented.

      6.    Indenture dated as of May 13, 1998, between The Coastal Corporation
            and The Bank of New York, as supplemented.

      13.   Note Purchase Agreement dated February 26, 1996, among The Coastal
            Corporation, Australia and New Zealand Banking Group Limited,
            Bankers Trust Company, Nationsbank of Texas, N.A., and The
            Toronto-Dominion Bank.

III.  EL PASO PRODUCTION HOLDING COMPANY INDENTURE

      1.    Indenture dated May 23, 2003, between El Paso Production Holding
            Company and Wilmington Trust Company.

                      Page 5 to Schedule 2 to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                    EXHIBIT A

                                     FORM OF

                           ACKNOWLEDGMENT AND CONSENT

      In connection with that certain Second Waiver to $3,000,000,000 Revolving
Credit Agreement dated as of June 15, 2004 (the "Second Waiver"), by and among
El Paso Corporation, a Delaware corporation (the "Company"), El Paso Natural Gas
Company, a Delaware corporation ("EPNGC"), Tennessee Gas Pipeline Company, a
Delaware corporation ("TGPC"), ANR Pipeline Company, a Delaware corporation
("ANR"), Colorado Interstate Gas Company, a Delaware corporation, the several
banks and other financial institutions signatories thereto, JPMorgan Chase Bank,
as Administrative Agent (the "Administrative Agent"), ABN AMRO Bank N.V. and
Citicorp North America, Inc., as Co-Documentation Agents, and Bank Of America,
N.A. and Credit Suisse First Boston, as Co-Syndication Agents, each of the
undersigned Persons, as a Subsidiary Guarantor under that certain Subsidiary
Guarantee Agreement, dated as of April 16, 2003 (as amended, supplemented or
otherwise modified from time to time, the "Subsidiary Guarantee Agreement") made
by each such Person in favor of JPMorgan Chase Bank, in its capacity as
Collateral Agent, (a) acknowledges the execution and delivery of the Second
Waiver by the Credit Parties that are party thereto and the effect of the
provisions of the Second Waiver and (b) confirms and agrees that as of June 15,
2004, after giving effect to the provisions of the Second Waiver, the Subsidiary
Guarantee Agreement is, and shall continue to be, in full force and effect and
is hereby ratified and confirmed in all respects and the Subsidiary Guarantee
Agreement and all of the Collateral do, and shall continue to, secure the
payment of all of the Guaranteed Obligations (as defined in the Subsidiary
Guarantee Agreement) pursuant to the terms of the Subsidiary Guarantee
Agreement. Capitalized terms not otherwise defined herein shall have the
meanings assigned to them in that certain $3,000,000,000 Revolving Credit
Agreement, dated as of April 16, 2003 (the "Credit Agreement"), by and among the
Company, EPNGC, TGPC, ANR, the several banks and other financial institutions
party thereto, the Administrative Agent, the Co-Documentation Agents and the
Co-Syndication Agents.

SUBSIDIARY GUARANTORS:              AMERICAN NATURAL RESOURCES COMPANY

                                    By: _____________________________________
                                        Name:
                                        Title:

                                    EL PASO ANR INVESTMENTS, L.L.C.

                                    By: _____________________________________
                                        Name:
                                        Title:

                      Page 1 to Exhibit A to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                    EL PASO ANRS INVESTMENTS, L.L.C.

                                    By: _____________________________________
                                        Name:
                                        Title:

                                    EL PASO CNG COMPANY, L.L.C.

                                    By: _____________________________________
                                        Name:
                                        Title:

                                    EL PASO EPN INVESTMENTS, L.L.C.

                                    By: _____________________________________
                                        Name:
                                        Title:

                                    EL PASO EPNG INVESTMENTS, L.L.C.

                                    By: _____________________________________
                                        Name:
                                        Title:

                                    EL PASO NORIC INVESTMENTS III, L.L.C.

                                    By: _____________________________________
                                        Name:
                                        Title:

                      Page 2 to Exhibit A to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                    EL PASO TENNESSEE PIPELINE CO.

                                    By: _____________________________________
                                        Name:
                                        Title:

                                    EL PASO TGPC INVESTMENTS, L.L.C.

                                    By: _____________________________________
                                        Name:
                                        Title:

                                    EL PASO WIC INVESTMENTS, L.L.C.

                                    By: _____________________________________
                                        Name:
                                        Title:

                                    SABINE RIVER INVESTORS I, L.L.C.

                                    By: _____________________________________
                                        Name:
                                        Title:

                                    SABINE RIVER INVESTORS II, L.L.C.

                                    By: _____________________________________
                                        Name:
                                        Title:

                                    SABINE RIVER INVESTORS III, L.L.C.

                                    By: _____________________________________
                                        Name:
                                        Title:

                      Page 3 to Exhibit A to Second Waiver

<PAGE>

                                                                  EXECUTION COPY

                                    SABINE RIVER INVESTORS IV, L.L.C.

                                    By: _____________________________________
                                        Name:
                                        Title:

                                    SABINE RIVER INVESTORS V, L.L.C.

                                    By: _____________________________________
                                        Name:
                                        Title:

                      Page 4 to Exhibit A to Second Waiver

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