Document:

exv10w3

Exhibit 10.3

EXECUTION VERSION

TULSA EQUIPMENT AND THROUGHPUT AGREEMENT

     This Tulsa Equipment and Throughput Agreement is being entered into on August 1, 2009 (this
“Agreement”), by and between Holly Refining & Marketing — Tulsa LLC, a Delaware
corporation, (“Tulsa Refining”), and HEP Tulsa LLC, a Delaware limited liability company
(“HEP Tulsa”). Each of Tulsa Refining and HEP Tulsa is individually referred to herein as
a “Party” and collectively as the “Parties.”

RECITALS:

     WHEREAS, on June 1, 2009, Tulsa Refining acquired the Tulsa Refinery, including the Tulsa
Loading Racks (each as defined below), from Sunoco, Inc. (R&M);

     WHEREAS, on the date hereof, HEP Tulsa is acquiring the Tulsa Loading Racks from Tulsa
Refining pursuant to an Asset Purchase Agreement (the “Asset Purchase Agreement”) and will
be granted certain access and other rights with respect to the Tulsa Loading Racks pursuant to a
Facility Sites, Access and Rail Line License Agreement;

     WHEREAS, HEP Tulsa is substantially dependent upon Tulsa Refining for the volumes of Products
(as defined below) handled at the Tulsa Loading Racks such that a significant reduction in Tulsa
Refining’s use of the Tulsa Loading Racks would likely result in a correspondingly significant
reduction in the financial and commercial success of HEP Tulsa; and

     WHEREAS,
Tulsa Refining and HEP Tulsa desire to enter into this Agreement.

     NOW, THEREFORE, the parties to this Agreement hereby agree as follows:

     Section 1. Definitions

     Capitalized terms used throughout this Agreement and not otherwise defined herein shall have
the meanings set forth below.

     “Affiliate” means, with respect to any Person, any other Person that directly or
indirectly through one or more intermediaries controls, is controlled by or is under common control
with, the Person in question, excluding, in the case of Tulsa Refining, the Partnership Group
Members and excluding, in the case of HEP Tulsa, the Holly Group Members.

     “Agreement” has the meaning set forth in the introduction.

     “Applicable Law” means any applicable statute, law, regulation, ordinance, rule,
judgment, rule of law, order, decree, permit, approval, concession, grant, franchise, license,
agreement, requirement, or other governmental restriction or any similar form of decision of, or
any provision or condition of any permit, license or other operating authorization issued under any
of the foregoing by, or any determination by any Governmental Authority having or asserting
jurisdiction over the matter or matters in question, whether now or hereafter in effect and in each
case as amended (including, without limitation, all of the terms and provisions of the common law
of such Governmental Authority), as interpreted and enforced at the time in question.

 

 

     “Arbitrable Dispute” means any and all disputes, Claims, controversies and other
matters in question between HEP Tulsa, on the one hand, and Tulsa Refining, on the other hand,
arising out of or relating to this Agreement or the alleged breach hereof, or in any way relating
to the subject matter of this Agreement regardless of whether (a) allegedly extra-contractual in
nature, (b) sounding in contract, tort or otherwise, (c) provided for by Applicable Law or
otherwise or (d) seeking damages or any other relief, whether at law, in equity or otherwise.

     “Asset Purchase Agreement” has the meaning set forth in the recitals.

     “Base Tariff” has the meaning set forth in Section 2(a)(ii).

     “bpd” means barrels per day.

     “Claim” means any existing or threatened future claim, demand, suit, action,
investigation, proceeding, governmental action or cause of action of any kind or character (in each
case, whether civil, criminal, investigative or administrative), known or unknown, under any
theory, including those based on theories of contract, tort, statutory liability, strict liability,
employer liability, premises liability, products liability, breach of warranty or malpractice.

     “Claimant” has the meaning set forth in Section 13(f).

     “Contract Year” means a year that commences on July 1 and ends on the last day of
June, except that the initial Contract Year shall commence on August 1, 2009.

     “Control” (including with correlative meaning, the term “controlled by”)
means, as used with respect to any Person, the possession, direct or indirect, of the power to
direct or cause the direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.

     “Deficiency Notice” has the meaning set forth in Section 11(a).

     “Deficiency Payment” has the meaning set forth in Section 11(a).

     “Environmental Laws” means all federal, state, and local laws, statutes, rules,
regulations, orders, and ordinances, now or hereafter in effect, relating to protection of the
environment including, without limitation, the federal Comprehensive Environmental Response,
Compensation, and Liability Act, the Superfund Amendments Reauthorization Act, the Resource
Conservation and Recovery Act, the Clean Air Act, the Federal Water Pollution Control Act, the
Toxic Substances Control Act, the Oil Pollution Act, the Safe Drinking Water Act, the Hazardous
Materials Transportation Act, and other environmental conservation and protection laws, each as
amended from time to time.

     “Force Majeure” means acts of God, strikes, lockouts or other industrial disturbances,
acts of the public enemy, wars, blockades, insurrections, riots, storms, floods, washouts, arrests,
the order of any court or Governmental Authority having jurisdiction while the same is in force and
effect, civil disturbances, explosions, breakage, accident to machinery, storage tanks or lines of
pipe, inability to obtain or unavoidable delay in obtaining material or equipment, and any other
causes whether of the kind herein enumerated or otherwise not reasonably within the

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control of the party claiming suspension and which by the exercise of due diligence such party
is unable to prevent or overcome.

     “Governmental Authority” means any federal, state, local or foreign government or any
provincial, departmental or other political subdivision thereof, or any entity, body or authority
exercising executive, legislative, judicial, regulatory, administrative or other governmental
functions or any court, department, commission, board, bureau, agency, instrumentality or
administrative body of any of the foregoing.

     “Hazardous Substance” means (a) any substance that is designated, defined, or
classified as a hazardous waste, hazardous material, pollutant, contaminant, or toxic or hazardous
substance, or that is otherwise regulated under any Environmental Law, including, without
limitation, any hazardous substance as defined under the Comprehensive Environmental Response,
Compensation, and Liability Act, and (b) petroleum, crude oil, gasoline, natural gas, fuel oil,
motor oil, waste oil, diesel fuel, jet fuel, and other refined petroleum hydrocarbons.

     “HEP Tulsa” has the meaning set forth in the introduction.

     “Holly Group” means Holly Corporation, a Delaware corporation, and Tulsa Refining and
any Subsidiary of Tulsa Refining, treated as a single consolidated entity.

     “Holly Group Member” means any member of the Holly Group.

     “Incentive Tariff” has the meaning set forth in Section 2(a)(ii).

     “Indemnified Party” means the party to this Agreement seeking indemnification under
Section 5.

     “Indemnifying Party” means the party to this Agreement from whom indemnification is
sought under Section 5.

     “Limited Partner” has the meaning set forth in the Partnership Agreement.

     “Minimum Revenue Commitment” has the meaning set forth in Section 2(a)(i).

     “Minimum Throughput” has the meaning set forth in Section 2(a)(ii).

     “Omnibus Agreement” means the Second Amended and Restated Omnibus Agreement, dated as
of August 1, 2009, among Holly Corporation, the Partnership and certain of their respective
subsidiaries, as amended from time-to-time.

     “PPI” has the meaning set forth in Section 2(a)(iii).

     “Partnership” means Holly Energy Partners, L.P., a Delaware limited partnership.

     “Partnership Agreement” means the First Amended and Restated Agreement of Limited
Partnership of Holly Energy Partners, L.P., dated July 13, 2004, as amended by Amendment No. 1 to
the First Amended and Restated Agreement of Limited Partnership of Holly Energy

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Partners, L.P., dated February 28, 2005, as amended by Amendment No. 2 to the First Amended
and Restated Agreement of Limited Partnership of Holly Energy Partners, L.P., dated July 6, 2005,
as amended by Amendment No. 3 to the First Amended and Restated Agreement of Limited Partnership of
Holly Energy Partners, L.P., dated April 11, 2008, as such agreement is in effect on the date of
this Agreement. No amendment or modification to the Partnership Agreement subsequent to the date
of this Agreement shall be given effect for the purposes of this Agreement unless consented to by
each of the parties to this Agreement.

     “Partnership Group” means the Partnership, Holly Energy Partners — Operating, L.P. and
any Subsidiary of any such Person, treated as a single consolidated entity.

     “Partnership Group Member” means any member of the Partnership Group.

     “Party” or “Parties” has the meaning set forth in the introduction.

     “Payment Obligations” has the meaning set forth in Section 14(a).

     “Person” means an individual or a corporation, limited liability company, partnership,
joint venture, trust, unincorporated organization, association, government agency or political
subdivision thereof or other entity.

     “Prime Rate” means the prime rate per annum announced by Union Bank, N.A., or if Union
Bank, N.A. no longer announces a prime rate for any reason, the prime rate per annum announced by
the largest U.S. bank measured by deposits from time to time as its base rate on corporate loans,
automatically fluctuating upward or downward with each announcement of such prime rate.

     “Products” means gasolines, diesel fuel, jet fuel, kerosene, heating oil, distillates,
transmix, liquefied petroleum gas, natural gas liquids, blend stocks, specialty lubricants,
ethanol, gas oil, naphtha, coker feed, and any other feedstock or blendstock that may be moved
across the Tulsa Loading Racks.

     “Purchase Option Agreement” means the Tulsa Purchase Option Agreement, dated August 1,
2009, between Tulsa Refining and HEP Tulsa.

     “Refund” has the meaning set forth in Section 11(c).

     “Respondent” has the meaning set forth in Section 13(f).

     “Subsidiary” means with respect to any Person, (a) a corporation of which more than
50% of the voting power of shares entitled (without regard to the occurrence of any contingency) to
vote in the election of directors or other governing body of such corporation is owned, directly or
indirectly, at the date of determination, by such Person, by one or more Subsidiaries of such
Person or a combination thereof, (b) a partnership (whether general or limited) in which such
Person or a Subsidiary of such Person is, at the date of determination, a general or limited
partner of such partnership, but only if more than 50% of the partnership interests of such
partnership (considering all of the partnership interests of the partnership as a single class) is
owned, directly or indirectly, at the date of determination, by such Person, by one or more
Subsidiaries of such

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Person, or a combination thereof, or (c) any other Person (other than a corporation or a
partnership) in which such Person, one or more Subsidiaries of such Person, or a combination
thereof, directly or indirectly, at the date of determination, has (i) at least a majority
ownership interest or (ii) the power to elect or direct the election of a majority of the directors
or other governing body of such Person.

     “Term” has the meaning set forth in Section 7.

     “Toxic Tort” means a claim or cause of action arising from personal injury or property
damage incurred by the plaintiff that is alleged to have been caused by exposure to, or
contamination by, Hazardous Substances that have been released into the environment by or as a
result of the actions or omissions of the defendant.

     “Tulsa Loading Racks” means the loading racks described on Exhibit A attached
hereto, as such Exhibit may be amended or revised from time-to-time by mutual agreement of Tulsa
Refining and HEP Tulsa.

     “Tulsa Refinery” means the refinery owned by Tulsa Refining located at 1700 S. Union
Avenue, Tulsa, Oklahoma 74107.

     “Tulsa Refining” has the meaning set forth in the introduction.

     Section 2. Agreement to Use Tulsa Loading Racks

     The parties intend to be strictly bound by the commercial terms set forth in this Agreement.
The principal objective of HEP Tulsa is for Tulsa Refining to meet or exceed the 12,500 bpd minimum
volume commitment as calculated on a monthly basis.

     (a) Throughput and Rate; Minimum Revenue Commitment. During the Term and subject to
the terms and conditions of this Agreement, Tulsa Refining agrees as follows:

          (i) Subject to Section 3, Tulsa Refining will load or unload by tanker truck or rail
car at the Tulsa Loading Racks an amount of Products in the aggregate that will satisfy the Minimum
Revenue Commitment for each contract month. The “Minimum Revenue Commitment” shall be an
amount of revenue to HEP Tulsa for each contract month determined by multiplying the Minimum
Throughput times the Base Tariff.

          (ii) Tulsa Refining will pay HEP Tulsa a fee of $0.60 per barrel (the “Base Tariff”),
as such Base Tariff may be revised pursuant to Section 2(a)(iii) and Schedule I
attached hereto, for the first 12,500 bpd of Products calculated on a monthly basis, or such other
amount of Products that is mutually agreed upon by the Parties pursuant to Section 3 (the
“Minimum Throughput”), received at or shipped from the Tulsa Loading Racks and a fee of
$0.30 per barrel (the “Incentive Tariff”), as such Incentive Tariff may be revised pursuant
to Section 2(a)(iii) and Schedule I attached hereto, for volumes in excess of the
Minimum Throughput received at or shipped from the Tulsa Loading Racks. No later than 15 days
after the end of each month during the Term, Tulsa Refining shall: (A) provide HEP Tulsa with a
report detailing the number of barrels of Products received at or shipped from the Tulsa Refinery
via the Tulsa Loading Racks for that month and (B) within ten days after receiving an invoice from
HEP Tulsa, pay HEP

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Tulsa the payment owed pursuant to this Section 2(a)(ii) and Section 11.
Payments not received by HEP Tulsa on or prior to the applicable payment date will accrue interest
at the Prime Rate from the applicable payment date until paid.

          (iii) Each of the Base Tariff and the Incentive Tariff shall be adjusted on July 1 of each
Contract Year by an amount equal to the upper change in the annual change rounded to four decimal
places of the Producers Price Index-Commodities-Finished Goods, (PPI), et al. (“PPI”),
produced by the U.S. Department of Labor, Bureaus of Labor Statistics; provided,
however, that such adjustment shall not exceed 3.0% in any Contract Year. The series ID is
WPUSOP3000 as of December 31, 2007 — located at
http://www.bls.gov/data/. The change factor shall
be calculated as follows: annual PPI index (most current year) less annual PPI index (most
current year minus 1) divided by annual PPI index (most current year minus 1). An example
for year 2006 change is: [PPI (2005) — PPI (2004)] / PPI (2004) or (155.7 — 148.5) / 148.5 or .0485 or 4.85%, which would then be rounded down to 3.0% so as not to exceed the 3.0% cap. If the
PPI index change is negative in a given year then there will be no change in the Base Tariff or the
Incentive Tariff. If the above index is no longer published, the Parties shall negotiate in good
faith to agree on a new index that gives comparable protection against inflation, and the same
method of adjustment for increases in the new index shall be used to calculate increases in the
Base Tariff and the Incentive Tariff. If the Parties are unable to agree, a new index will be
determined by binding arbitration in accordance with Section 13(f), and the same method of
adjustment for increases in the new index shall be used to calculate increases in the Base Tariff
and the Incentive Tariff. To evidence the Parties agreement to each adjusted Base Tariff and
Incentive Tariff, the Parties shall execute an amended, modified, revised or updated Schedule
I and attach it to this Agreement. Such amended, modified, revised or updated Schedule
I shall be sequentially numbered (e.g. Schedule I-1, Schedule I-2, etc.), dated
and appended as an additional schedule to this Agreement and shall replace the prior version of
Schedule I in its entirety, except as specified therein.

     (b) Operation and Maintenance of Tulsa Loading Racks.

          (i) During the Term, (1) HEP Tulsa hereby retains Tulsa Refining, and Tulsa Refining hereby
accepts such retention, to (at Tulsa Refining’s sole cost and expense) manage, operate and maintain
the Tulsa Loading Racks for and on behalf of HEP Tulsa; (2) HEP Tulsa hereby authorizes Tulsa
Refining to do and perform any and all acts and things necessary, requisite or proper for the
efficient and safe operation, maintenance, upkeep and repair of the Tulsa Loading Racks and to do
all other things that Tulsa Refining deems necessary or appropriate to the accomplishment of the
purposes of this Agreement, so that the Tulsa Loading Racks may be utilized to load or unload at
the Tulsa Loading Racks an average of 12,500 bpd of Products; and (3) Tulsa Refining shall manage
and direct such operation, maintenance, upkeep and repair in an efficient, safe and economical
manner and in accordance with all valid and applicable laws, rules and regulations of governmental
authorities.

          (ii) During the Term, Tulsa Refining shall maintain in effect all material licenses,
authorizations, permissions or permits of a Governmental Authority necessary to operate the Tulsa
Loading Racks.

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     (c) Exclusive Use; Insurance.

          (i) HEP Tulsa agrees that during the Term, Tulsa Refining and its Affiliates shall have the
exclusive right to use the Tulsa Loading Racks.

          (ii) During the Term, Tulsa Refining agrees to carry and keep in full force and effect
insurance, including, without limitation, general liability and commercial property insurance,
covering the Tulsa Loading Racks for the protection of the Parties that is customary for businesses
of their type.

          (iii) During the Term if any of the Tulsa Loading Racks are damaged or destroyed, then Tulsa
Refining shall, in its sole discretion, either (x) rebuild or repair such damaged or destroyed
Tulsa Loading Racks or (y) pay HEP Tulsa an amount equal to the replacement cost of such damaged or
destroyed Tulsa Loading Racks. In the event the Parties are unable to agree on the replacement
cost of the Tulsa Loading Racks, the replacement cost shall be determined by binding arbitration in
accordance with Section 13(f).

     (d) Equipment Expansions and Modifications. From time-to-time the parties may agree
to expand or modify certain equipment covered by this Agreement, including refined products loading
racks and other equipment. In connection with the expansion or modification of such equipment, the
parties may agree to certain reimbursements, increased tariff rates or other payments or may
otherwise revise the terms of this Agreement to address such projects. Attached to this Agreement
as Exhibit B is a list of current expansion or modification projects agreed to by the
parties hereto and the terms of such projects. Exhibit B may be amended, modified,
revised or updated from time-to-time to evidence the parties’ agreement to new expansion or
modification projects; the completion, termination or revision of previously agreed to expansion or
modification projects; or the modification of the terms of this Agreement in connection with the
addition, completion, termination or revision of such expansion or modification projects. To
evidence the Parties agreement to each new expansion or modification project or the completion,
termination or revision of previously agreed to expansion or modification project or the
modification of the terms of this Agreement in connection with the addition, completion,
termination or revision of such expansion or modification projects, the Parties shall execute an
amended, modified, revised or updated Exhibit B and attach it to this Agreement. Such
amended, modified, revised or updated Exhibit B shall be sequentially numbered (e.g.
Exhibit B-1, Exhibit B-2, etc.), dated and appended as an additional exhibit to
this Agreement and shall replace the prior version of Exhibit B in its entirety, except as
specified therein.

     (e) Taxes. Tulsa Refining will pay all taxes, import duties, license fees and other
charges by any Governmental Authority levied on the Products delivered by Tulsa Refining for
transportation through the Tulsa Loading Racks. Subject to Article 3 of the Asset Purchase
Agreement, Tulsa Refining will pay all real property taxes by any Governmental Authority levied on
the real property on which the Tulsa Loading Racks are located and HEP Tulsa will pay all real
property taxes, if any, or personal property taxes by any Governmental Authority levied on the
Tulsa Loading Racks.

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     (f) Books and Records. During the Term, HEP Tulsa shall have the right, no more than
twice in any twelve month period, to review and audit Tulsa Refining’s books and records relating
to the volume of Products received at or shipped from the Tulsa Loading Racks for purposes of
verifying Tulsa Refining’s compliance with Section 2(a)(ii). Any review, audit or
investigation undertaken by HEP Tulsa shall be at HEP Tulsa’s own cost and expense.

     (g) Monthly Surcharge. If new laws or regulations are enacted that require HEP Tulsa
to make substantial and unanticipated capital expenditures with respect to the Tulsa Loading Racks,
HEP Tulsa may impose a monthly surcharge to cover HEP Tulsa’s cost of complying with these laws or
regulations. Tulsa Refining and HEP Tulsa shall use their reasonable commercial efforts to comply
with these laws and regulations and shall negotiate in good faith to mitigate the impact of these
laws and regulations and to determine the level of the monthly surcharge. If the Parties are
unable to agree on the level of the monthly surcharge, such surcharge will be determined by binding
arbitration in accordance with Section 13(f). Any applicable exhibit or schedule to this
Agreement will be updated, amended or revised, as applicable, in accordance with this Agreement to
reflect any monthly surcharge agreed to in accordance with this Section 2(g).

     Section 3. Exceptions to Tulsa Refining’s Obligations

     (a) Shut Down or Reconfiguration of Tulsa Refinery. Tulsa Refining must deliver to
HEP Tulsa at least six months advance written notice of any planned shut down or reconfiguration
(excluding planned maintenance turnarounds) of the Tulsa Refinery or any portion of the Tulsa
Refinery that would reduce the Tulsa Refinery’s output. Tulsa Refining will use its commercially
reasonable efforts to mitigate any reduction in revenues or throughput obligations under this
Agreement that would result from such a shut down or reconfiguration. If Tulsa Refining shuts down
or reconfigures the Tulsa Refinery or any portion of the Tulsa Refinery (excluding planned
maintenance turnarounds) and reasonably believes in good faith that such shut down or
reconfiguration will jeopardize its ability to satisfy its Minimum Revenue Commitment under this
Agreement, then within 90 days of the delivery of the written notice of the planned shut down or
reconfiguration unless it is exercising its right to purchase the Tulsa Loading Racks pursuant to
Section 3(a) of the Purchase Option Agreement, Tulsa Refining shall (i) propose a new Minimum
Revenue Commitment, such that the ratio of the new Minimum Revenue Commitment under this Agreement
over the anticipated production level following the shut down or reconfiguration will be
approximately equal to the ratio of the original Minimum Revenue Commitment under this Agreement
over the original production level and (ii) propose the date on which the new Minimum Revenue
Commitment shall take effect. Unless objected to by HEP Tulsa within 60 days of receipt by HEP
Tulsa of such proposal, such new Minimum Revenue Commitment shall become effective as of the date
proposed by Tulsa Refining. To the extent that HEP Tulsa does not agree with Tulsa Refining’s
proposal, any changes in Tulsa Refining’s obligations under this Agreement, or the date on which
such changes will take effect, will be determined by binding arbitration in accordance with
Section 13(f). Schedule I or any other applicable exhibit or schedule to this
Agreement will be updated, amended or revised, as applicable, in accordance with this Agreement to
reflect any change in Tulsa Refining’s Minimum Revenue Commitment agreed to in accordance with this
Section 3(a).

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     (b) Force Majeure. In the event that any party is rendered unable, wholly or in part,
by a Force Majeure event from performing its obligations under this Agreement for a period of more
than 30 days, then upon the delivery of notice and full particulars of the Force Majeure event in
writing within a reasonable time after the occurrence of the Force Majeure event relied on, the
obligations of the parties, so far as they are affected by the Force Majeure event, shall be
suspended for the duration of any inability so caused. Any suspension of the obligations of the
parties as a result of this Section 3(b) shall extend the Term. Tulsa Refining will be
required to pay any amounts accrued and due under this Agreement at the time of the Force Majeure
event. The cause of the Force Majeure event shall so far as possible be remedied with all
reasonable dispatch, except that no party shall be compelled to resolve any strikes, lockouts or
other industrial disputes other than as it shall determine to be in its best interests. In the
event a Force Majeure event prevents HEP Tulsa or Tulsa Refining from performing its obligations
under this Agreement for a period of more than one year, this Agreement may be terminated by HEP
Tulsa or Tulsa Refining.

     Section 4. Agreement to Remain Shipper

     With respect to any Products that are produced at the Tulsa Refinery and handled at any Tulsa
Loading Rack, Tulsa Refining agrees that it will continue its historical commercial practice of
owning such Products handled at a Tulsa Loading Rack and to continue acting in the capacity of the
shipper of any such Products for its own account at all times that such Products are being handled
at the Tulsa Loading Racks.

     Section 5. Indemnification

     (a) Indemnification of HEP Tulsa. Tulsa Refining shall indemnify, defend and hold
harmless HEP Tulsa from and against any losses, damages, liabilities, Claims, demands, causes of
action, judgments, settlements, fines, penalties, costs, and expenses (including, without
limitation, court costs and reasonable attorney’s and expert’s fees) of any and every kind or
character, known or unknown, fixed or contingent, suffered or incurred by HEP Tulsa, including
environmental and Toxic Tort losses, to the extent arising out of:

          (i) events and conditions associated with the operation of the Tulsa Loading Racks and
occurring (x) before the date of this Agreement or (y) during the Term while Tulsa Refining is
operating the Tulsa Loading Racks (except, in the case of (y), to the extent arising out of (aa)
the gross negligence or willful misconduct of HEP Tulsa, its agents, employees, contractors,
Affiliates or assignees at the Tulsa Refinery in connection with activities undertaken by any such
Persons at or with respect to the Tulsa Refinery, or (bb) the operation of the Tulsa Loading Racks
at the direction of HEP Tulsa by any Person other than (A) Tulsa Refining or its Affiliates or (B)
a Person operating the Tulsa Loading Racks at the direction of Tulsa Refining or its Affiliates,
and in the case of (bb), arising out of the negligent acts or omissions or willful misconduct of
such Person),

          (ii) all legal actions pending against Tulsa Refining on August 1, 2009,

          (iii) all federal, state and local tax liabilities attributable to (A) the operation or
ownership of the Tulsa Loading Racks prior to the date of this Agreement and (B) the operation

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of the Tulsa Loading Racks during the Term while Tulsa Refining is operating the Tulsa Loading
Racks,

          (iv) any violation or correction of violation of Environmental Laws associated with the
ownership or operation of the Tulsa Loading Racks occurring (x) prior to the date of this Agreement
or (y) during the Term while Tulsa Refining is operating the Tulsa Loading Racks (except, in the
case of (y), to the extent associated with the operation of the Tulsa Loading Racks at the
direction of HEP Tulsa by any Person other than (1) Tulsa Refining or its Affiliates or (2) a
Person operating the Tulsa Loading Racks at the direction of Tulsa Refining or its Affiliates), or

          (v) any environmental or Toxic Tort event or condition associated with ownership or operation
of the Tulsa Loading Racks (including, without limitation, the presence of Hazardous Substances on,
under, about or migrating to or from the Tulsa Loading Racks or the disposal or release of
Hazardous Substances generated by operation of the Tulsa Loading Racks) occurring (x) prior to the
date of this Agreement or (y) during the Term while Tulsa Refining is operating the Tulsa Loading
Racks (except, in the case of (y), to the extent associated with the operation of the Tulsa Loading
Racks at the direction of HEP Tulsa by any Person other than (1) Tulsa Refining or its Affiliates
or (2) a Person operating the Tulsa Loading Racks at the direction of Tulsa Refining or its
Affiliates), including, without limitation, (A) the cost and expense of any investigation,
assessment, evaluation, monitoring, containment, cleanup, repair, restoration, remediation, or
other corrective action required or necessary under Environmental Laws, (B) the cost or expense of
the preparation and implementation of any closure, remedial, corrective action, or other plans
required or necessary under Environmental Laws, and (C) the cost and expense for any environmental
or Toxic Tort pre-trial, trial, or appellate legal or litigation support work.

     (b) Indemnification of Tulsa Refining. HEP Tulsa shall indemnify, defend and hold
harmless Tulsa Refining from and against any losses, damages, liabilities, Claims, demands, causes
of action, judgments, settlements, fines, penalties, costs, and expenses (including, without
limitation, court costs and reasonable attorney’s and expert’s fees) of any and every kind or
character, known or unknown, fixed or contingent, suffered or incurred by Tulsa Refining, including
environmental and Toxic Tort losses, to the extent arising out of:

          (i) the gross negligence or willful misconduct of HEP Tulsa, its agents, employees,
contractors, Affiliates or assignees at the Tulsa Refinery in connection with activities undertaken
by any such Persons at or with respect to the Tulsa Refinery,

          (ii) the operation of the Tulsa Loading Racks at the direction of HEP Tulsa by any Person
other than (x) Tulsa Refining or its Affiliates or (y) a Person operating the Tulsa Loading Racks
at the direction of Tulsa Refining or its Affiliates, and arising out of the negligent acts or
omissions or willful misconduct of such Person,

          (iii) any violation or correction of violation of Environmental Laws associated with (x) the
operation of the Tulsa Loading Racks at the direction of HEP Tulsa by any Person other than (1)
Tulsa Refining or its Affiliates or (2) a Person operating the Tulsa Loading Racks

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at the direction of Tulsa Refining or its Affiliates, or (y) the ownership of the Tulsa
Loading Racks after the Term by any Person other than Tulsa Refining or its Affiliates, or

          (iv) any environmental or Toxic Tort event or condition associated with (x) the operation of
the Tulsa Loading Racks (including, without limitation, the presence of Hazardous Substances on,
under, about or migrating to or from the Tulsa Loading Racks or the disposal or release of
Hazardous Substances generated by operation of the Tulsa Loading Racks) at the direction of HEP
Tulsa by any Person other than (1) Tulsa Refining or its Affiliates or (2) a Person operating the
Tulsa Loading Racks at the direction of Tulsa Refining or its Affiliates, or (y) the ownership of
the Tulsa Loading Racks after the Term by any Person other than Tulsa Refining or its Affiliates
including, without limitation, (A) the cost and expense of any investigation, assessment,
evaluation, monitoring, containment, cleanup, repair, restoration, remediation, or other corrective
action required or necessary under Environmental Laws, (B) the cost or expense of the preparation
and implementation of any closure, remedial, corrective action, or other plans required or
necessary under Environmental Laws, and (C) the cost and expense for any environmental or Toxic
Tort pre-trial, trial, or appellate legal or litigation support work,

          (v) except to the extent arising prior to the date of this Agreement, all federal, state and
local tax liabilities attributable to the ownership of the Tulsa Loading Racks.

     (c) Indemnification Procedures.

          (i) The Indemnified Party agrees that promptly after it becomes aware of facts giving rise to
a claim for indemnification under this Section 5, it will provide notice thereof in writing
to the Indemnifying Party, specifying the nature of and specific basis for such claim.

          (ii) The Indemnifying Party shall have the right to control all aspects of the defense of (and
any counterclaims with respect to) any claims brought against the Indemnified Party that are
covered by the indemnification under this Section 5, including, without limitation, the
selection of counsel, determination of whether to appeal any decision of any court and the settling
of any such matter or any issues relating thereto; provided, however, that no such
settlement shall be entered into without the consent of the Indemnified Party unless it includes a
full release of the Indemnified Party from such matter or issues, as the case may be.

          (iii) The Indemnified Party agrees to cooperate fully with the Indemnifying Party, with
respect to all aspects of the defense of any claims covered by the indemnification under this
Section 5, including, without limitation, the prompt furnishing to the Indemnifying Party
of any correspondence or other notice relating thereto that the Indemnified Party may receive,
permitting the name of the Indemnified Party to be utilized in connection with such defense, the
making available to the Indemnifying Party of any files, records or other information of the
Indemnified Party that the Indemnifying Party considers relevant to such defense and the making
available to the Indemnifying Party of any employees of the Indemnified Party; provided,
however, that in connection therewith the Indemnifying Party agrees to use reasonable
efforts to minimize the impact thereof on the operations of the Indemnified Party and further
agrees to maintain the confidentiality of all files, records, and other information furnished by
the Indemnified Party pursuant to this Section 5(c). In no event shall the obligation of
the

11

 

Indemnified Party to cooperate with the Indemnifying Party as set forth in the immediately
preceding sentence be construed as imposing upon the Indemnified Party an obligation to hire and
pay for counsel in connection with the defense of any claims covered by the indemnification set
forth in this Section 5; provided, however, that the Indemnified Party may,
at its own option, cost and expense, hire and pay for counsel in connection with any such defense.
The Indemnifying Party agrees to keep any such counsel hired by the Indemnified Party informed as
to the status of any such defense, but the Indemnifying Party shall have the right to retain sole
control over such defense.

          (iv) In determining the amount of any loss, cost, damage or expense for which the Indemnified
Party is entitled to indemnification under this Agreement, the gross amount of the indemnification
will be reduced by all amounts recovered by the Indemnified Party under contractual indemnities
(other than insurance policies) from third Persons. An Indemnified Party shall be obligated to
pursue all contractual indemnities that such Indemnified Party has with third Persons outside of
this Agreement, provided, however, if the Indemnified Party’s right to such
indemnification is assignable, the Indemnified Party may, in its sole discretion and in lieu of
pursuing such claim, elect to assign such indemnification claim to the Indemnifying Party to pursue
and shall reasonably cooperate with the Indemnifying Party (including, without limitation, making
its relevant books, records, officers, information and testimony reasonably available to the
Indemnifying Party) in the Indemnifying Party’s pursuit of such claim. In the event the
Indemnified Party recovers under a contractual indemnity from a third Person outside of this
Agreement, the amount recovered, less the reasonable out-of-pocket fees and expenses incurred by
the Indemnified Party in recovering such amounts, shall reduce the amount such Indemnified Party
may recover under this Section 5 and if the Indemnified Party receives any such amounts
subsequent to an indemnification payment by the Indemnifying Party in respect of such losses, then
such Indemnified Party shall promptly reimburse the Indemnifying Party for any payment made or
expense incurred by such Indemnifying Party in connection with providing such indemnification
payment up to the amount so received by the Indemnified Party.

          (v) The Indemnifying Party’s indemnification obligations, and the Indemnified Party’s
entitlement to indemnification, are subject to the limitation on damages contained in Section
13(i).

     (d) Survival of Indemnification. The provisions of this Section 5 shall
survive the termination of this Agreement (including any termination following the sale of the
Tulsa Loading Racks pursuant to the Purchase Option Agreement).

     Section 6. Consent to Third-Party Operator

     If at any time Tulsa Refining does not operate, maintain and manage the Tulsa Loading Racks,
then the written consent of Tulsa Refining, which consent may not be unreasonably withheld, shall
be required before any Person, other than the owner of the Tulsa Loading Racks or its Affiliates,
operates, maintains or manages the Tulsa Loading Racks. This Section 6 shall survive any
termination of this Agreement and shall automatically terminate at such time as the Tulsa Refinery
and the Tulsa Loading Racks are owned by the same Person or an Affiliate of such Person.

12

 

     Section 7. Effectiveness and Term

     This Agreement shall be effective as of August 1, 2009 and shall terminate at 12:01 a.m.
Dallas, Texas, time on August 1, 2024, unless extended pursuant to Section 3(b) or by
written mutual agreement of the Parties hereto or as set forth in Section 8 or earlier
terminated pursuant to the Purchase Option Agreement (the “Term”). In the event Tulsa
Refining desires to extend this Agreement, it shall provide prior written notice to HEP Tulsa of
its desire to so extend this Agreement; such written notice shall be provided not more than
twenty-four (24) months and not less than the later of twelve (12) months prior to the date of
termination or ten (10) days after receipt of a written request from HEP Tulsa (which request may
be delivered no earlier than twelve (12) months prior to the date of termination) to provide any
such notice or lose such right.

     Section 8. Right to Enter into a New Agreement

     (a) In the event that Tulsa Refining provides prior written notice to HEP Tulsa of the desire
of Tulsa Refining to extend this Agreement by written mutual agreement of the Parties, the Parties
shall negotiate in good faith to extend this Agreement by written mutual agreement, but, if such
negotiations fail to produce a written mutual agreement for extension by a date six months prior to
the termination date, then HEP Tulsa shall have the right to negotiate to enter into one or more
throughput agreements with one or more third parties to begin after the date of termination,
provided that until the end of one year following termination without renewal of this Agreement,
Tulsa Refining will have the right to enter into a new throughput agreement with HEP Tulsa on
commercial terms that substantially match the terms upon which HEP Tulsa proposes to enter into an
agreement with a third party for similar services with respect to all or a material portion of the
Tulsa Loading Racks. In such circumstances, HEP Tulsa shall give Tulsa Refining forty-five (45)
days prior written notice of any proposed new throughput agreement with a third party, and such
notice shall inform Tulsa Refining of the fee schedules, tariffs, duration and any other terms of
the proposed third party agreement and Tulsa Refining shall have forty-five (45) days following
receipt of such notice to agree to the terms specified in the notice or Tulsa Refining shall lose
the rights specified by this Section 8(a) with respect to the assets that are the subject
of such notice.

     (b) In the event that Tulsa Refining fails to provide prior written notice to HEP Tulsa of its
desire to extend this Agreement by written mutual agreement of the Parties pursuant to Section
7, HEP Tulsa shall have the right, during the period from the date of Tulsa Refining’s failure
to provide written notice pursuant to Section 7 to the date of termination of this
Agreement, to negotiate to enter into a new throughput agreement with a third party, provided
however that at any time during the twelve (12) months prior to the expiration of the Term, Tulsa
Refining will have the right to enter into a new throughput agreement with HEP Tulsa on commercial
terms that substantially match the terms upon which HEP Tulsa proposes to enter into an agreement
with a third party for similar services with respect to all or a material portion of the Tulsa
Loading Racks. In such circumstances, HEP Tulsa shall give Tulsa Refining forty-five (45) days
prior written notice of any proposed new throughput agreement with a third party, and such notice
shall inform Tulsa Refining of the fee schedules, tariffs, duration and any other terms of the
proposed third party agreement and Tulsa Refining shall have forty-five (45) days following receipt
of such notice to agree to the terms specified in the notice or Tulsa Refining

13

 

shall lose the rights specified by this Section 8(b) with respect to the assets that
are the subject of such notice.

     Section 9. Repurchase Right and Buyout of Remaining Term

     Notwithstanding anything in this Agreement to the contrary, the parties acknowledge Tulsa
Refining’s right to purchase the Tulsa Loading Racks and/or buyout the remaining term of this
Agreement, and HEP Tulsa’s right to put the Tulsa Loading Racks to Tulsa Refining, upon the terms
set forth in the Purchase Option Agreement.

     Section 10. Notices

     (a) Any notice or other communication given under this Agreement shall be in writing and shall
be (i) delivered personally, (ii) sent by documented overnight delivery service, (iii) sent by
email transmission, or (iv) sent by first class mail, postage prepaid (certified or registered
mail, return receipt requested). Such notice shall be deemed to have been duly given (x) if
received, on the date of the delivery, with a receipt for delivery, (y) if refused, on the date of
the refused delivery, with a receipt for refusal, or (z) with respect to email transmissions, on
the date the recipient confirms receipt. Notices or other communications shall be directed to the
following addresses:

Notices to Tulsa Refining:

Holly Refining & Marketing — Tulsa LLC

100 Crescent Court, Suite 1600

Dallas, Texas 75201

Attn: David L. Lamp

Email address: president @hollycorp.com

with a copy, which shall not constitute notice, but is required in order to give proper notice, to:

Holly Refining & Marketing — Tulsa LLC

100 Crescent Court, Suite 1600

Dallas, Texas 75201

Attn: General Counsel

Email address: generalcounsel@hollycorp.com

14

 

Notices to HEP Tulsa:

HEP Tulsa LLC

100 Crescent Court, Suite 1600

Dallas, Texas 75201

Attn: David G. Blair

Email address: SVP-HEP@hollyenergy.com

with a copy, which shall not constitute notice, but is required in
order to give proper notice, to:

HEP Tulsa LLC

100 Crescent Court

Suite 1600

Dallas, Texas 75201

Attn: General Counsel

Email address: generalcounsel@hollycorp.com

     (b) Either Party may at any time change its address for service from time to time by giving
notice to the other Party in accordance with this Section 10.

     Section 11. Deficiency Payments

     (a) As soon as practicable following the end of each contract month under this Agreement, HEP
Tulsa shall deliver to Tulsa Refining a written notice (the “Deficiency Notice”) detailing
any failure of Tulsa Refining to meet its obligations under Section 2(a)(i); provided that
Tulsa Refining’s obligations pursuant to its Minimum Revenue Commitment in Section 2(a)(i)
shall be assessed on a monthly basis for purposes of this Section 11. The Deficiency
Notice shall (i) specify in reasonable detail the nature of any deficiency and (ii) specify the
approximate dollar amount that HEP Tulsa believes would have been paid by Tulsa Refining to HEP
Tulsa if Tulsa Refining had complied with its respective obligations pursuant to Section
2(a)(i) (the “Deficiency Payment”). Tulsa Refining shall pay the Deficiency Payment to
HEP Tulsa upon the later of: (A) ten (10) days after its receipt of the Deficiency Notice and (B)
thirty (30) days following the end of the related contract month.

     (b) If Tulsa Refining disagrees with the Deficiency Notice, then, following the payment of the
Deficiency Payment to HEP Tulsa, a senior officer of Tulsa Refining and a senior officer of HEP
Tulsa shall meet or communicate by telephone at a mutually acceptable time and place, and
thereafter as often as they reasonably deem necessary and shall negotiate in good faith to attempt
to resolve any differences that they may have with respect to matters specified in the Deficiency
Notice. During the 30-day period following the payment of the Deficiency Payment, Tulsa Refining
shall have access to the working papers of HEP Tulsa relating to the Deficiency Notice. If such
differences are not resolved within thirty (30) days following the payment of the Deficiency
Payment, Tulsa Refining and HEP Tulsa shall, within forty-five (45) days following the payment of
the Deficiency Payment, submit any and all matters which remain in dispute and which were properly
included in the Deficiency Notice to arbitration in accordance with Section 13(f).

15

 

     (c) If it is finally determined pursuant to this Section 11 that Tulsa Refining is not
required to make any or all of the Deficiency Payment (the “Refund”), HEP Tulsa shall
promptly pay to Tulsa Refining the Refund, together with interest thereon at the Prime Rate, in
immediately available funds.

     (d) The parties acknowledge and agree that there shall be no carry-over of deficiency volumes
with respect to Tulsa Refining’s Minimum Revenue Commitment under Section 2(a).

     Section 12. Right of First Refusal

     The Parties acknowledge the right of first refusal of Tulsa Refining with respect to the Tulsa
Loading Racks provided in the Purchase Option Agreement.

     Section 13. Miscellaneous

     (a) Intention as to Tulsa Refinery. Tulsa Refining represents to HEP Tulsa that, as
of August 1, 2009, it is not considering a shut down of the Tulsa Refinery or any changes to the
Tulsa Refinery that would have a material adverse effect on the operation of the Tulsa Refinery.

     (b) Amendments and Waivers. No amendment or modification of this Agreement shall be
valid unless it is in writing and signed by the Parties. No waiver of any provision of this
Agreement shall be valid unless it is in writing and signed by the party against whom the waiver is
sought to be enforced. Any of the exhibits or schedules to this Agreement may be amended,
modified, revised or updated by the Parties if each of the Parties execute an amended, modified,
revised or updated exhibit or schedule, as applicable, and attach it to this Agreement. Such
amended, modified, revised or updated exhibits or schedules shall be sequentially numbered (e.g.
Exhibit A-1, Exhibit A-2, etc.), dated and appended as an additional exhibit or schedule to this
Agreement and shall replace the prior exhibit or schedule, as applicable, in its entirety, except
as specified therein. No failure or delay in exercising any right hereunder, and no course of
conduct, shall operate as a waiver of any provision of this Agreement. No single or partial
exercise of a right hereunder shall preclude further or complete exercise of that right or any
other right hereunder.

     (c) Successors and Assigns.

          (i) This Agreement shall inure to the benefit of, and shall be binding upon, Tulsa Refining,
HEP Tulsa and their respective successors and permitted assigns. Neither this Agreement nor any of
the rights or obligations hereunder shall be assigned without the prior written consent of Tulsa
Refining (in the case of any assignment by HEP Tulsa) or HEP Tulsa (in the case of any assignment
by Tulsa Refining); provided, however, that (i) HEP Tulsa may make such an
assignment (including a partial pro rata assignment) to an Affiliate of HEP Tulsa without Tulsa
Refining’s consent, (ii) Tulsa Refining may make such an assignment (including a pro rata partial
assignment) to an Affiliate of Tulsa Refining without the consent of HEP Tulsa, (iii) Tulsa
Refining may make a collateral assignment of its rights and obligations hereunder and/or grant a
security interest in its rights and obligations to all or a portion of the Tulsa Loading Racks to
any bona fide third party lender or debt holder, or trustee or representative for any of them
without the consent of HEP Tulsa, (iv) HEP Tulsa may make a collateral assignment of its rights
hereunder and/or grant a security interest in its rights and obligations hereunder to a

16

 

bona fide third party lender or debt holder, or trustee or representative for any of them
without Tulsa Refining’s consent, if such third party lender, debt holder or trustee shall have
executed and delivered to Tulsa Refining a non-disturbance agreement in such form as is reasonably
satisfactory to Tulsa Refining and such third party lender, debt holder, or trustee, (v) HEP Tulsa
may assign all of its rights and obligations under this Agreement to any Person to whom it
transfers the Tulsa Loading Racks without Tulsa Refining’s consent, and (vi) Tulsa Refining may
assign all of its rights and obligations under this Agreement to any third party(ies) that acquire
the Tulsa Refinery without the consent of HEP Tulsa. Any attempt to make an assignment otherwise
than as permitted by the foregoing shall be null and void. The Parties agree to require their
respective successors, if any, to expressly assume, in a form of agreement reasonably acceptable to
the other Party, their obligations under this Agreement.

          (ii) HEP Tulsa agrees that it will require any Person to whom it transfers the Tulsa Loading
Racks to expressly assume all of HEP Tulsa’s obligations under this Agreement and the Purchase
Option Agreement, in a form of agreement reasonably acceptable to Tulsa Refining.

     (d) Severability. If any provision of this Agreement shall be held invalid or
unenforceable by a court or regulatory body of competent jurisdiction, the remainder of this
Agreement shall remain in full force and effect.

     (e) Choice of Law. This Agreement shall be subject to and governed by the laws of the
State of Delaware, excluding any conflicts-of-law rule or principle that might refer the
construction or interpretation of this Agreement to the laws of another state.

     (f) Arbitration Provision. Any and all Arbitrable Disputes must be resolved through
the use of binding arbitration using three arbitrators, in accordance with the Commercial
Arbitration Rules of the American Arbitration Association, as supplemented to the extent necessary
to determine any procedural appeal questions by the Federal Arbitration Act (Title 9 of the United
States Code). If there is any inconsistency between this Section 13(f) and the Commercial
Arbitration Rules or the Federal Arbitration Act, the terms of this Section 13(f) will
control the rights and obligations of the Parties. Arbitration must be initiated within the time
limits set forth in this Agreement, or if no such limits apply, then within a reasonable time or
the time period allowed by the applicable statute of limitations. Arbitration may be initiated by
a Party (“Claimant”) serving written notice on the other Party (“Respondent”) that
the Claimant elects to refer the Arbitrable Dispute to binding arbitration. Claimant’s notice
initiating binding arbitration must identify the arbitrator Claimant has appointed. The Respondent
shall respond to Claimant within thirty (30) days after receipt of Claimant’s notice, identifying
the arbitrator Respondent has appointed. If the Respondent fails for any reason to name an
arbitrator within the 30-day period, Claimant shall petition the American Arbitration Association
for appointment of an arbitrator for Respondent’s account. The two arbitrators so chosen shall
select a third arbitrator within thirty (30) days after the second arbitrator has been appointed.
The Claimant will pay the compensation and expenses of the arbitrator named by it, and the
Respondent will pay the compensation and expenses of the arbitrator named by or for it. The costs
of petitioning for the appointment of an arbitrator, if any, shall be paid by Respondent. The
Claimant and Respondent will each pay one-half of the compensation and expenses of the third
arbitrator. All arbitrators must (i) be neutral parties who have never been officers, directors or
employees of

17

 

any of Tulsa Refining, HEP Tulsa or any of their Affiliates and (ii) have not less than seven
(7) years experience in the energy industry. The hearing will be conducted in Dallas, Texas and
commence within thirty (30) days after the selection of the third arbitrator. Tulsa Refining, HEP
Tulsa and the arbitrators shall proceed diligently and in good faith in order that the award may be
made as promptly as possible. Except as provided in the Federal Arbitration Act, the decision of
the arbitrators will be binding on and non-appealable by the Parties hereto. The arbitrators shall
have no right to grant or award indirect, consequential, punitive or exemplary damages of any kind.
The Arbitrable Disputes may be arbitrated in a common proceeding along with disputes under other
agreements between the Tulsa Refining, HEP Tulsa or their Affiliates to the extent that the issues
raised in such disputes are related. Without the written consent of the Parties, no unrelated
disputes or third party disputes may be joined to an arbitration pursuant to this Agreement.

     (g) Further Assurances. In connection with this Agreement and all transactions
contemplated by this Agreement, each signatory Party hereto agrees to execute and deliver such
additional documents and instruments and to perform such additional acts as may be necessary or
appropriate to effectuate, carry out and perform all of the terms, provisions and conditions of
this Agreement and all such transactions.

     (h) Headings. Headings of the Sections of this Agreement are for convenience of the
Parties only and shall be given no substantive or interpretative effect whatsoever. All references
in this Agreement to Sections are to Sections of this Agreement unless otherwise stated.

     (i) Limitation of Damages. NOTWITHSTANDING ANYTHING CONTAINED TO THE CONTRARY IN ANY
OTHER PROVISION OF THIS AGREEMENT AND EXCEPT FOR CLAIMS MADE BY THIRD PARTIES WHICH SHALL NOT BE
LIMITED BY THIS PARAGRAPH, THE PARTIES AGREE THAT THE RECOVERY BY ANY PARTY, INCLUDING PURSUANT TO
SECTION 5, OF ANY LIABILITIES, DAMAGES, COSTS OR OTHER EXPENSES SUFFERED OR INCURRED BY IT (i) AS A
RESULT OF ANY BREACH OR NONFULFILLMENT BY A PARTY OF ANY OF ITS REPRESENTATIONS, WARRANTIES,
COVENANTS, AGREEMENTS OR OTHER OBLIGATIONS UNDER THIS AGREEMENT OR (ii) BY REASON OF OR ARISING OUT
OF ANY OF THE EVENTS, CONDITIONS OR OTHER MATTERS LISTED IN SECTION 5(a) OR SECTION 5(b) WHICH THE
PARTIES HAVE AGREED TO INDEMNIFY THE OTHER PARTY AGAINST, SHALL BE LIMITED TO ACTUAL DAMAGES AND
SHALL NOT INCLUDE OR APPLY TO, NOR SHALL ANY PARTY BE ENTITLED TO RECOVER, ANY INDIRECT,
CONSEQUENTIAL, EXEMPLARY OR PUNITIVE DAMAGES (INCLUDING, WITHOUT LIMITATION, ANY DAMAGES ON ACCOUNT
OF LOST PROFITS OR OPPORTUNITIES OR BUSINESS INTERRUPTION OR DIMINUTION IN VALUE) SUFFERED OR
INCURRED BY ANY PARTY; PROVIDED, HOWEVER, THAT SUCH RESTRICTION AND LIMITATION
SHALL NOT APPLY TO A PARTY’S OBLIGATION TO INDEMNIFY THE OTHER PARTY UNDER SECTION 5(a) OR SECTION
5(b) HEREOF, AS APPLICABLE, (Y) AS A RESULT OF A THIRD PARTY CLAIM FOR SUCH INDIRECT,
CONSEQUENTIAL, EXEMPLARY OR PUNITIVE DAMAGES AGAINST SUCH INDEMNIFIED PARTY, OR (Z) FOR INDIRECT,
CONSEQUENTIAL, EXEMPLARY OR PUNITIVE DAMAGES (INCLUDING, WITHOUT LIMITATION, ANY DAMAGES ON ACCOUNT
OF LOST PROFITS OR OPPORTUNITIES OR BUSINESS INTERRUPTION OR

18

 

DIMINUTION IN VALUE) THAT ARE A RESULT OF SUCH INDEMNIFYING PARTY’S OR ITS AFFILIATES’ GROSS
NEGLIGENCE OR WILLFULL MISCONDUCT.

     (j) Notice to Third Parties. Tulsa Refining authorizes HEP Tulsa to file in the
applicable recording office in the State of Delaware a UCC-1 Financing Statement (i) listing Tulsa
Refining as “Debtor”, (ii) listing HEP Tulsa as “Secured Party” and (iii) checking the
“Lessee/Lessor” as an alternative designation. The Parties agree that such UCC-1 Financing
Statement is solely to provide notice to third parties of HEP Tulsa’s ownership of the Tulsa
Loading Racks, that such financing statement shall not evidence a security interest in any of Tulsa
Refining’s personal property, and that no such security interest is granted or deemed to be granted
hereunder.

     Section 14. Guarantee

     (a) Payment and Performance Guaranty. The Partnership unconditionally, absolutely,
continually and irrevocably guarantees, as principal and not as surety, to Tulsa Refining the
punctual and complete payment in full when due of all amounts due from HEP Tulsa under the
Agreement (collectively, the “Payment Obligations”). The Partnership agrees that Tulsa
Refining shall be entitled to enforce directly against the Partnership any of the Payment
Obligations.

     (b) Guaranty Absolute. The Partnership hereby guarantees that the Payment Obligations
will be paid strictly in accordance with the terms of the Agreement. The obligations of the
Partnership under this Agreement constitute a present and continuing guaranty of payment, and not
of collection or collectibility. The liability of the Partnership under this Agreement shall be
absolute, unconditional, present, continuing and irrevocable irrespective of:

          (i) any assignment or other transfer of the Agreement or any of the rights thereunder of Tulsa
Refining;

          (ii) any amendment, waiver, renewal, extension or release of or any consent to or departure
from or other action or inaction related to the Agreement;

          (iii) any acceptance by Tulsa Refining of partial payment or performance from HEP Tulsa;

          (iv) any bankruptcy, insolvency, reorganization, arrangement, composition, adjustment,
dissolution, liquidation or other like proceeding relating to HEP Tulsa or any action taken with
respect to the Agreement by any trustee or receiver, or by any court, in any such proceeding;

          (v) any absence of any notice to, or knowledge of, the Partnership, of the existence or
occurrence of any of the matters or events set forth in the foregoing subsections (i) through (iv);
or

          (vi) any other circumstance which might otherwise constitute a defense available to, or a
discharge of, a guarantor.

19

 

     The obligations of the Partnership hereunder shall not be subject to any reduction,
limitation, impairment or termination for any reason, including any claim of waiver, release,
surrender, alteration or compromise, and shall not be subject to any defense or setoff,
counterclaim, recoupment or termination whatsoever by reason of the invalidity, illegality or
unenforceability of the Payment Obligations or otherwise.

     (c) Waiver. The Partnership hereby waives promptness, diligence, all setoffs,
presentments, protests and notice of acceptance and any other notice relating to any of the Payment
Obligations and any requirement for Tulsa Refining to protect, secure, perfect or insure any
security interest or lien or any property subject thereto or exhaust any right or take any action
against HEP Tulsa, any other entity or any collateral.

     (d) Subrogation Waiver. The Partnership agrees that it shall not have any rights
(direct or indirect) of subrogation, contribution, reimbursement, indemnification or other rights
of payment or recovery from HEP Tulsa for any payments made by the Partnership under this
Section 14 until all Payment Obligations have been indefeasibly paid, and the Partnership
hereby irrevocably waives and releases, absolutely and unconditionally, any such rights of
subrogation, contribution, reimbursement, indemnification and other rights of payment or recovery
it may now have or hereafter acquire against HEP Tulsa until all Payment Obligations have been
indefeasibly paid.

     (e) Reinstatement. The obligations of the Partnership under this Section 14
shall continue to be effective or shall be reinstated, as the case may be, if at any time any
payment of any of the Payment Obligations is rescinded or must otherwise be returned to HEP Tulsa
or any other entity, upon the insolvency, bankruptcy, arrangement, adjustment, composition,
liquidation or reorganization of HEP Tulsa or such other entity, or for any other reason, all as
though such payment had not been made.

     (f) Continuing Guaranty. This Section 14 is a continuing guaranty and shall
(i) remain in full force and effect until the first to occur of the indefeasible payment in full of
all of the Payment Obligations, (ii) be binding upon the Partnership, its successors and assigns
and (iii) inure to the benefit of and be enforceable by Tulsa Refining and its successors,
transferees and assigns.

     (g) No Duty to Pursue Others. It shall not be necessary for Tulsa Refining (and the
Partnership hereby waives any rights which the Partnership may have to require Tulsa Refining), in
order to enforce such payment by the Partnership, first to (i) institute suit or exhaust its
remedies against HEP Tulsa or others liable on the Payment Obligations or any other person, (ii)
enforce Tulsa Refining’s rights against any other guarantors of the Payment Obligations, (iii) join
HEP Tulsa or any others liable on the Payment Obligations in any action seeking to enforce this
Section 14, (iv) exhaust any remedies available to Tulsa Refining against any security
which shall ever have been given to secure the Payment Obligations, or (v) resort to any other
means of obtaining payment of the Payment Obligations.

[Remainder of Page Intentionally Left Blank]

20

 

     IN WITNESS WHEREOF, the undersigned Parties have executed this Agreement as of the date first
written above.

	 	 	 	 	 
	 	HOLLY REFINING & MARKETING — TULSA LLC

 	 
	 	By:  	/s/ David L. Lamp
 	 
	 	 	David L. Lamp 	 
	 	 	President 	 
	 
	 	HEP TULSA LLC

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

	 	 	 	 	 
	ACKNOWLEDGED AND AGREED

FOR PURPOSES OF Section 14:

HOLLY ENERGY PARTNERS, L.P.

	 	 
	By:  	HEP Logistics Holdings, L.P.,

its General Partner

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

its General Partner

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

Signature Page 1 of 1 to the Tulsa Equipment and Throughput Agreement

 

 

SCHEDULE I

TARIFFS

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Incentive Tariff
	 	 	Base Tariff	 	(For volumes in excess of
	Contract Year	 	(For the first 12,500 bpd)	 	12,500 bpd)
	August 1, 2009
	 	$0.60 per barrel	 	$0.30 per barrel

Schedule I

 

 

EXHIBIT A

TULSA
LOADING RACKS

As of August 1, 2009

The following descriptions are of the above ground loading equipment located at the Tulsa Refinery
that are subject to this Agreement. The drawings attached to this Exhibit show the detail of the
rail track footage acquired by HEP Tulsa. All other above ground piping and improvements located
on these drawings was purchased by HEP Tulsa.

#1. Lube Oil Rail Rack — A covered finished lube oil rail car loading rack consisting of 10 rail
spots, 12 loading arms, two loading lines, a gear oil line, steam, air and water lines. There are
rail tracks located on both the north and south sides of this loading rack. The rack is used to
load multiple finished lube oil products. The rack is located in Section 11, Township 19 North,
Range 12 East, I.B.M., Tulsa County, Oklahoma. See Drawing Number 1 for more detail.

#2. Wax Rail Car Rack — An uncovered wax loading rack consisting of four rail spots. The rack is
served by two tracks. The rack is located in Section 10, Township 19 North, Range 12 East, I.B.M.,
Tulsa County, Oklahoma. See Drawing Number 2 for more detail.

#3. Black Oil Rail Rack — An uncovered black oil rail car loading rack consisting of four rail
loading arms and a total of seven car loading capabilities. There are two tracks at this rack
which serve both the north and south sides of this rack. This rack is located in Section 10,
Township 19 North, Range 12 East, I.B.M., Tulsa County, Oklahoma. See Drawing Number 3 for more
detail.

#4. Lube Oil Truck Rack — A covered four bay lube oil loading rack. There are eight loading
spots and the capability to load two trucks at one time. There are scales on each bay, however,
the scale on bay two and four are not functional at this time. This rack is located in Section 11,
Township 19 North, Range 12 East, I.B.M., Tulsa County, Oklahoma. See Drawing Number 4 for more
detail.

#5. Extract Truck Rack — A covered single bay truck rack for loading finished extract products.
There is a scale at this loading rack. This rack is located in Section 10, Township 19 North,
Range 12 East, I.B.M. Tulsa County, Oklahoma. See Drawing Number 5 for more detail.

#6. [Intentionally omitted]

#7. Wax Truck Rack — A covered single bay truck rack for loading finish waxes. There is a scale
at this loading rack. This rack is located in Section 10, Township 19 North, Range 12 East,
I.B.M., Tulsa County, Oklahoma. See Drawing Number 7 for more detail.

#8. Extract Rail Rack — An uncovered four spot finished extract loading rack. This rack is
located in Section 10, Township 19 North, Range 12 East, I.B.M., Tulsa County, Oklahoma. See
Drawing Number 8 for more detail.

A-1

 

#9. Bright Stock Rail Rack — An uncovered bright stock rail car loading rack consisting of eight
rail spots and dual tracks with four loading arms.

#10. Diesel Rail Car Loading Rack — An uncovered diesel rail car loading rack with the capability
of loading seven cars through the four rail loading arms. This rack has dual tracks.

#11. L-70 Rail Rack — An uncovered rail car loading rack consisting of three rail spots. This
rack has dual tracks.

Racks 9, 10, and 11 are contiguous racks served by dual tracks located in Section 10, Township 19
North, Range 12 East, I.B.M., Tulsa County, Oklahoma. See Drawings Numbered 9, 10 and 11 for more
detail.

#12. [Intentionally omitted]

#13. Soft Wax MEK Truck Rack — An uncovered truck loading rack with a single spot. There is no
scale at this location. This rack is located in Section 11, Township 19 North, Range 12 East,
I.B.M., Tulsa County, Oklahoma. See Drawing Number 13 for more detail.

The Parties agree that the Tulsa Loading Racks do not include the following loading racks located
at the Tulsa Refinery (which loading racks are owned by Tulsa Refining or its Affiliates):

	 	•	 	The Gasoline/Diesel Fuel/Jet Fuel truck loading rack
	 
	 	•	 	The Asphalt Resid rail car loading rack and the Asphalt Resid truck loading dock

A-2

 

Drawing Number 1

     

A-3

 

Drawing Number 2

     

A-4

 

Drawing Number 3

     

A-5

 

Drawing Number 4

A-6

 

Drawing Number 5

     

A-7

 

Drawing Number 7

A-8

 

Drawing Number 8

A-9

 

Drawing Number 9, 10 and 11

A-10

 

Drawing Number 9, 10 and 11 (continued)

A-11

 

Drawing Number 13

A-12

 

EXHIBIT B

EQUIPMENT EXPANSIONS AND MODIFICATIONS

As of August 1, 2009

None.

B-1exv10w4

Exhibit 10.4

EXECUTION VERSION

TULSA PURCHASE OPTION AGREEMENT

     This Tulsa Purchase Option Agreement is being entered into on August 1, 2009 (this
“Agreement”), by and between Holly Refining & Marketing — Tulsa LLC, a Delaware limited
liability company (“Tulsa Refining”), and HEP Tulsa LLC, a Delaware limited liability
company (“HEP Tulsa”). Each of Tulsa Refining and HEP Tulsa is individually referred to
herein as a “Party” and collectively as the “Parties.”

RECITALS:

     WHEREAS, on June 1, 2009, Tulsa Refining acquired the Tulsa Refinery, including the Tulsa
Loading Racks (each as defined below), from Sunoco, Inc. (R&M);

     WHEREAS, on the date hereof, HEP Tulsa is acquiring the Tulsa Loading Racks from Tulsa
Refining pursuant to an Asset Purchase Agreement and will be granted certain access and other
rights with respect to the Tulsa Loading Racks pursuant to an Equipment Sites, Access and Rail Line
License Agreement (the “License Agreement”); and

     WHEREAS, Tulsa Refining and HEP Tulsa desire to enter into this Agreement to evidence their
agreement regarding certain purchase options and put rights (some of which are summarized on
Exhibit A attached hereto) with respect to the Tulsa Loading Racks.

     NOW, THEREFORE, the parties to this Agreement hereby agree as follows:

     Section 1. Definitions

     Capitalized terms used throughout this Agreement and not otherwise defined herein shall have
the meanings set forth below.

     “Acquisition Proposal” has the meaning set forth in Section 4(b).

     “Affiliate” means, with respect to any Person, any other Person that directly or
indirectly through one or more intermediaries controls, is controlled by or is under common control
with, the Person in question, excluding, in the case of Tulsa Refining, the Partnership Group
Members and excluding, in the case of HEP Tulsa, the Holly Group Members.

     “Agreement” has the meaning set forth in the introduction.

     “Applicable Law” means any applicable statute, law, regulation, ordinance, rule,
judgment, rule of law, order, decree, permit, approval, concession, grant, franchise, license,
agreement, requirement, or other governmental restriction or any similar form of decision of, or
any provision or condition of any permit, license or other operating authorization issued under any
of the foregoing by, or any determination by any Governmental Authority having or asserting
jurisdiction over the matter or matters in question, whether now or hereafter in effect and in each
case as amended (including, without limitation, all of the terms and provisions of the common law
of such Governmental Authority), as interpreted and enforced at the time in question.

 

 

     “Arbitrable Dispute” means any and all disputes, Claims, controversies and other
matters in question between HEP Tulsa, on the one hand, and Tulsa Refining, on the other hand,
arising out of or relating to this Agreement or the alleged breach hereof, or in any way relating
to the subject matter of this Agreement regardless of whether (a) allegedly extra-contractual in
nature, (b) sounding in contract, tort or otherwise, (c) provided for by Applicable Law or
otherwise or (d) seeking damages or any other relief, whether at law, in equity or otherwise.

     “Claim” means any existing or threatened future claim, demand, suit, action,
investigation, proceeding, governmental action or cause of action of any kind or character (in each
case, whether civil, criminal, investigative or administrative), known or unknown, under any
theory, including those based on theories of contract, tort, statutory liability, strict liability,
employer liability, premises liability, products liability, breach of warranty or malpractice.

     “Control” (including with correlative meaning, the term “controlled by”)
means, as used with respect to any Person, the possession, direct or indirect, of the power to
direct or cause the direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.

     “Disposition Notice” has the meaning set forth in Section 4(b).

     “Fair Market Value” means the fair market cash value of the Tulsa Loading Racks to a
third party at the time of the proposed sale to Tulsa Refining or its Affiliates, excluding any
value pursuant to the Tulsa Throughput Agreement or any other agreement relating to the Tulsa
Loading Racks, less the sum of the actual amounts expended for capital expenditures and
improvements made by Tulsa Refining or its Affiliates to the Tulsa Loading Racks during the Term.

     “First ROFR Acceptance Deadline” has the meaning set forth in Section 4(b).

     “Governmental Authority” means any federal, state, local or foreign government or any
provincial, departmental or other political subdivision thereof, or any entity, body or authority
exercising executive, legislative, judicial, regulatory, administrative or other governmental
functions or any court, department, commission, board, bureau, agency, instrumentality or
administrative body of any of the foregoing.

     “HEP Tulsa” has the meaning set forth in the introduction.

     “Holly” means Holly Corporation, a Delaware corporation.

     “Holly Group” means Holly Corporation, a Delaware corporation, and Tulsa Refining and
any Subsidiary of Tulsa Refining, treated as a single consolidated entity.

     “Holly Group Member” means any member of the Holly Group.

     “License Agreement” has the meaning set forth in the recitals.

     “Offer Price” has the meaning set forth in Section 4(b).

2

 

     “Partnership” means Holly Energy Partners, L.P., a Delaware limited partnership.

     “Partnership Group” means the Partnership, Holly Energy Partners — Operating, L.P. and
any Subsidiary of any such Person, treated as a single consolidated entity.

     “Partnership Group Member” means any member of the Partnership Group.

     “Party” or “Parties” has the meaning set forth in the introduction.

     “Permitted Encumbrances” means (i) statutory liens for current taxes or assessments
not yet due or delinquent or the validity of which are being contested in good faith by appropriate
proceedings; (ii) mechanics, carriers’, workers’, repairmen’s, landlord’s and other similar liens
imposed by law arising or incurred in the ordinary course of business with respect to charges not
yet due and payable; and (iii) such other encumbrances, if any, which were not incurred in
connection with the borrowing of money or the advance of credit and which do not materially detract
from the value of or interfere with the present use, or any use presently anticipated by the owner
thereof, of the property subject thereto or affected thereby, and including without limitation
capital leases.

     “Person” means an individual or a corporation, limited liability company, partnership,
joint venture, trust, unincorporated organization, association, government agency or political
subdivision thereof or other entity.

     “Proposed Transferee” has the meaning set forth in Section 4(b).

     “Purchaser” has the meaning set forth in Section 3(a).

     “Real Property” has the meaning set forth in Section 6(a).

     “Respondent” has the meaning set forth in Section 10(e).

     “Sale Assets” has the meaning set forth in Section 4(b).

     “Second ROFR Acceptance Deadline” has the meaning set forth in Section 4(b)

     “Subsidiary” means with respect to any Person, (a) a corporation of which more than
50% of the voting power of shares entitled (without regard to the occurrence of any contingency) to
vote in the election of directors or other governing body of such corporation is owned, directly or
indirectly, at the date of determination, by such Person, by one or more Subsidiaries of such
Person or a combination thereof, (b) a partnership (whether general or limited) in which such
Person or a Subsidiary of such Person is, at the date of determination, a general or limited
partner of such partnership, but only if more than 50% of the partnership interests of such
partnership (considering all of the partnership interests of the partnership as a single class) is
owned, directly or indirectly, at the date of determination, by such Person, by one or more
Subsidiaries of such Person, or a combination thereof, or (c) any other Person (other than a
corporation or a partnership) in which such Person, one or more Subsidiaries of such Person, or a
combination thereof, directly or indirectly, at the date of determination, has (i) at least a
majority ownership

3

 

interest or (ii) the power to elect or direct the election of a majority of the directors or
other governing body of such Person.

     “Term” has the meaning set forth in the Tulsa Throughput Agreement.

     “Transfer” including the correlative terms “Transferring” or
“Transferred” means any direct or indirect transfer, assignment, sale, gift, pledge,
hypothecation or other encumbrance, or any other disposition (whether voluntary, involuntary or by
operation of law) of the Tulsa Loading Racks.

     “Tulsa Loading Racks” has the meaning set forth in the Tulsa Throughput Agreement.

     “Tulsa Refinery” means the refinery owned by Tulsa Refining located at 1700 S. Union
Avenue, Tulsa, Oklahoma 74107.

     “Tulsa Refining” has the meaning set forth in the introduction.

     “Tulsa Throughput Agreement” means the Tulsa Equipment and Throughput Agreement, dated
as of August 1, 2009, between Tulsa Refining and HEP Tulsa, as amended from time-to-time.

     “UCC” means the Uniform Commercial Code of the State of Delaware.

     Section 2. Option to Purchase the Tulsa Loading Racks Upon Termination of the Tulsa
Throughput Agreement Due to Non-Renewal or Extension of the Tulsa Throughput Agreement

     (a) HEP Tulsa hereby grants to Tulsa Refining the unconditional right and option to purchase
for Fair Market Value (in accordance with this Section 2) all of HEP Tulsa’s, right title
and interest in, to and under the Tulsa Loading Racks. In the event Tulsa Refining desires to
exercise its option to purchase the Tulsa Loading Racks pursuant to this Section 2, it
shall provide prior written notice to HEP Tulsa of its desire to so purchase the Tulsa Loading
Racks; such written notice shall be provided not more than twenty-four (24) months and not less
than twelve (12) months prior to the date of termination of this Agreement.

     (b) If Tulsa Refining decides to exercise the option to purchase the Tulsa Loading Racks, it
will provide written notice to HEP Tulsa of such exercise, the Fair Market Value it proposes to pay
for the Tulsa Loading Racks, and the other terms of the purchase. If Tulsa Refining and HEP Tulsa
are unable to agree on the Fair Market Value of the Tulsa Loading Racks or the other terms of the
purchase within 30 days following HEP Tulsa’s receipt of Tulsa Refining’s notice of its exercise of
the option to purchase the Tulsa Loading Racks, the Parties will engage a mutually-agreed-upon
investment banking firm to determine, within 30 days of such investment banking firm’s engagement,
the Fair Market Value of the Tulsa Loading Racks and/or the other terms on which Tulsa Refining and
HEP Tulsa are unable to agree. The fees of the investment banking firm will be split equally
between Tulsa Refining and HEP Tulsa. Once the investment banking firm submits its determination of
the Fair Market Value of the Tulsa Loading Racks and/or the other terms on which Tulsa Refining and
HEP Tulsa are unable to agree, Tulsa Refining will have the right, but not the obligation, to
purchase the Tulsa Loading

4

 

Racks on the terms as modified by the determination of the investment banking firm. Tulsa
Refining will provide written notice of its decision to HEP Tulsa within 30 days after the
investment banking firm has submitted its determination. Failure to provide such notice within such
30-day period shall be deemed to constitute a decision not to purchase the Tulsa Loading Racks.

     (c) If Tulsa Refining chooses to exercise its option to purchase the Tulsa Loading Racks under
this Section 2, this Agreement shall become a contract of sale and purchase for the Tulsa
Loading Racks pursuant to which HEP Tulsa shall be obligated to sell the Tulsa Loading Racks to
Tulsa Refining and Tulsa Refining shall be obligated to purchase the Tulsa Loading Racks from HEP
Tulsa. The terms of the purchase and sale agreement, unless otherwise agreed to by Tulsa Refining
and HEP Tulsa, will include the following:

          (i) Tulsa Refining will deliver, or cause to be delivered, a cash purchase price (or any other
consideration agreed to by Tulsa Refining and HEP Tulsa (each in their sole discretion));

          (ii) HEP Tulsa will represent that there are no liens on the Tulsa Loading racks (other than
Permitted Encumbrances) and that it has good and indefeasible title to the Tulsa Loading Racks,
subject to all Permitted Encumbrances, matters recorded and physical conditions existing as of the
date of this Agreement, plus any other such matters as Tulsa Refining may approve, which approval
will not be unreasonably withheld;

          (iii) unless otherwise agreed to by the Parties, the closing date for the purchase of the
Tulsa Loading Racks shall occur on the date of termination of this Agreement;

          (iv) HEP Tulsa shall execute, have acknowledged and deliver to Tulsa Refining a bill of sale
or comparable document and, if applicable, a conveyance, special warranty deed, assignment of
easement, or comparable document, as appropriate, in the applicable jurisdiction, on the closing
date for the purchase of the Tulsa Loading Racks conveying the Tulsa Loading Racks unto Tulsa
Refining free and clear of all encumbrances created or allowed by HEP Tulsa other than those set
forth in Section 2(c)(ii) above;

          (v) subject to the requirements set forth in Section 2(c)(ii) and Section
2(c)(iv), the sale of the Tulsa Loading Racks shall be made on an “as is,” “where is” and “with
all faults” basis, and the instruments conveying the Tulsa Loading Racks shall contain appropriate
disclaimers;

          (vi) neither HEP Tulsa nor Tulsa Refining shall have any obligation to sell or buy the Tulsa
Loading Racks if any required written consents of governmental authorities and other third parties
have not been obtained or such sale or purchase is prohibited by Applicable Law; and

          (vii) the sale of the Tulsa Loading Racks shall be subject to the receipt of any consents or
waivers required pursuant to the Amended and Restated Credit Agreement, dated as of August 27,
2007, among Holly Energy Partners — Operating, L.P., the Banks party thereto, and Union Bank,
N.A., as Administrative Agent, as such agreement may be amended, restated, otherwise modified or
refinanced from time to time.

5

 

     (d) Tulsa Refining and HEP Tulsa shall cooperate in good faith in obtaining all necessary
governmental and other third Person approvals, waivers and consents required for the closing. Any
such closing shall be delayed, to the extent required, until the third business day following the
expiration of any required waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended; provided, however, that such delay shall not exceed 120 days
and, if governmental approvals and waiting periods shall not have been obtained or expired, as the
case may be, by such 120th day, then Tulsa Refining may notify HEP Tulsa that it is waiving its
option to purchase the Tulsa Loading Racks and thereafter neither Tulsa Refining nor HEP Tulsa
shall have any further obligation under this Section 2 with respect to Tulsa Refining’s
prior election to purchase the Tulsa Loading Racks.

     (e) Notwithstanding anything in this Agreement to the contrary, if Tulsa Refining chooses or
is deemed to have chosen not to exercise its option to purchase the Tulsa Loading Racks at the
price determined by the investment banking firm under Section 2(b), such choice shall not
impact its rights to purchase the Tulsa Loading Racks pursuant to this Section 2 in the
future and such rights shall remain in effect and shall not be extinguished until the expiration of
the term set forth in Section 2(a).

     Section 3. Repurchase Right In Event of a Sale of the Tulsa Refinery; Buyout of Remaining
Term

     (a) If during the Term Tulsa Refining (i) shuts down the Tulsa Refinery and such planned shut
down is intended at the time of such shut down to be permanent or (ii) sells or causes to be sold
to a third party(ies), including any Person in which Holly or its Affiliates have a minority
interest, the Tulsa Refinery, including, among other things, any sale, merger or consolidation of
the entity or entities which own the Tulsa Refinery and related assets, then Tulsa Refining shall
be entitled to (x) assign all of its rights and obligations under this Agreement and the Tulsa
Throughput Agreement to such third party(ies) or (y) purchase the Tulsa Loading Racks for a cash
purchase price equal to the net present value, at a discount rate of 15%, of the remaining minimum
payments, based upon the then current base tariff, under Section 2(a) of the Tulsa
Throughput Agreement from the date of the sale through the end of the Term, which (in the case of
(y)) will result in the termination of the Tulsa Throughput Agreement. (The cash purchase price in
clause (y) does not include Fair Market Value and such concept shall not apply to the cash purchase
price payable pursuant to this Section 3.) In the event Tulsa Refining elects to purchase
the Tulsa Loading Racks in accordance with this Section 3, then this Agreement shall become
a contract of sale and purchase for the Tulsa Loading Racks pursuant to which HEP Tulsa shall be
obligated to sell the Tulsa Loading Racks to Tulsa Refining or the third party(ies) purchasing the
Tulsa Refinery (the “Purchaser”). The terms of the purchase and sale agreement, unless
otherwise agreed to by Tulsa Refining and HEP Tulsa, will include the following:

          (i) Tulsa Refining or the Purchaser, as applicable, will deliver, or cause to be delivered, a
cash purchase price (or any other consideration agreed to by Tulsa Refining or the Purchaser, as
applicable, and HEP Tulsa (each in their sole discretion));

          (ii) HEP Tulsa will represent that there are no liens on the Tulsa Loading Racks (other than
Permitted Encumbrances) and that it has good and indefeasible title to the Tulsa Loading Racks,
subject to all Permitted Encumbrances, matters recorded and physical

6

 

conditions existing as of the date of this Agreement, plus any other such matters as Tulsa
Refining or the Purchaser may approve, which approval will not be unreasonably withheld;

          (iii) unless otherwise agreed to by Tulsa Refining or the Purchaser, as applicable, and HEP
Tulsa, the closing date for the purchase of the Tulsa Loading Racks shall occur no later than 90
days following receipt by HEP Tulsa of written notice by Tulsa Refining of the exercise of its
rights under this Section 3;

          (iv) HEP Tulsa shall execute, have acknowledged and deliver to Tulsa Refining or the
Purchaser, as applicable, a bill of sale or comparable document and, if applicable, a conveyance,
special warranty deed, assignment of easement, or comparable document, as appropriate, in the
applicable jurisdiction, on the closing date for the purchase of the Tulsa Loading Racks conveying
the Tulsa Loading Racks unto Tulsa Refining or the Purchaser, as applicable, free and clear of all
encumbrances created or allowed by HEP Tulsa other than those set forth in Section 3(a)(ii)
above;

          (v) subject to the requirements set forth in Section 3(a)(ii) and Section
3(a)(iv), the sale of the Tulsa Loading Racks shall be made on an “as is,” “where is” and “with
all faults” basis, and the instruments conveying the Tulsa Loading Racks shall contain appropriate
disclaimers;

          (vi) neither HEP Tulsa nor Tulsa Refining or the Purchaser shall have any obligation to sell
or buy the Tulsa Loading Racks if any required written consents of governmental authorities and
other third parties have not been obtained or such sale or purchase is prohibited by Applicable
Law; and

          (vii) the sale of the Tulsa Loading Racks shall be subject to the receipt of any consents or
waivers required pursuant to the Amended and Restated Credit Agreement, dated as of August 27,
2007, among Holly Energy Partners — Operating, L.P., the Banks party thereto, and Union Bank,
N.A., as Administrative Agent, as such agreement may be amended, restated, otherwise modified or
refinanced from time to time.

     (b) Tulsa Refining or the Purchaser, as applicable, and HEP Tulsa shall cooperate in good
faith in obtaining all necessary governmental and other third Person approvals, waivers and
consents required for the closing. Any such closing shall be delayed, to the extent required, until
the third business day following the expiration of any required waiting periods under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended; provided,
however, that such delay shall not exceed 120 days and, if governmental approvals and
waiting periods shall not have been obtained or expired, as the case may be, by such 120th day,
then Tulsa Refining or the Purchaser, as applicable, may notify HEP Tulsa that it is waiving its
right to purchase the Tulsa Loading Racks and thereafter none of Tulsa Refining, the Purchaser or
HEP Tulsa shall have any further obligation under this Section 3 with respect to Tulsa
Refining’s prior election to purchase the Tulsa Loading Racks.

     (c) If Purchaser does not agree to assume the License Agreement and Tulsa Refining’s rights
and obligations as “Licensor” thereunder, then Tulsa Refining shall have been

7

 

deemed to have exercised its option to purchase the Tulsa Loading Racks under this Section
3 at a purchase price as determined under clause (y) in Section 3(a).

     Section 4. Tulsa Refining Right of First Refusal to Purchase the Tulsa Loading Racks

     (a) HEP Tulsa hereby grants to Tulsa Refining a right of first refusal on any proposed
Transfer (other than a grant of a security interest to a bona fide third-party lender or a Transfer
to an Affiliate) of the Tulsa Loading Racks.

     (b) If HEP Tulsa proposes to Transfer any of the of the Tulsa Loading Racks to any Person
pursuant to a bona fide third-party offer (an “Acquisition Proposal”), then HEP Tulsa shall
promptly give written notice (a “Disposition Notice”) thereof to Tulsa Refining. The
Disposition Notice shall set forth the following information in respect of the proposed Transfer:
the name and address of the prospective acquiror (the “Proposed Transferee”), the Tulsa
Loading Racks subject to the Acquisition Proposal (the “Sale Assets”), the purchase price
offered by such Proposed Transferee (the “Offer Price”), reasonable detail concerning any
non-cash portion of the proposed consideration, if any, to allow Tulsa Refining to reasonably
determine the fair market value of such non-cash consideration, HEP Tulsa’s estimate of the fair
market value of any non-cash consideration and all other material terms and conditions of the
Acquisition Proposal that are then known to HEP Tulsa. To the extent the Proposed Transferee’s
offer consists of consideration other than cash (or in addition to cash) the Offer Price shall be
deemed equal to the amount of any such cash plus the fair market value of such non-cash
consideration. In the event Tulsa Refining and HEP Tulsa agree as to the fair market value of any
non-cash consideration, Tulsa Refining will provide written notice of its decision regarding the
exercise of its right of first refusal to purchase the Sale Assets within 30 days of its receipt of
the Disposition Notice (the “First ROFR Acceptance Deadline”). Failure to provide such
notice within such 30-day period shall be deemed to constitute a decision not to purchase the Sale
Assets. In the event (i) Tulsa Refining’s determination of the fair market value of any non-cash
consideration described in the Disposition Notice (to be determined by Tulsa Refining within 30
days of receipt of such Disposition Notice) is less than the fair market value of such
consideration as determined by HEP Tulsa in the Disposition Notice and (ii) Tulsa Refining and HEP
Tulsa are unable to mutually agree upon the fair market value of such non-cash consideration within
30 days after Tulsa Refining notifies HEP Tulsa of its determination thereof, HEP Tulsa and Tulsa
Refining shall engage a mutually-agreed-upon investment banking firm to determine the fair market
value of the non-cash consideration. Such investment banking firm shall be instructed to return its
decision within 30 days after all material information is submitted thereto, which decision shall
be final. The fees of the investment banking firm will be split equally between Tulsa Refining and
HEP Tulsa. Tulsa Refining will provide written notice of its decision regarding the exercise of its
right of first refusal to purchase the Sale Assets to HEP Tulsa within 30 days after the investment
banking firm has submitted its determination (the “Second ROFR Acceptance Deadline”).
Failure to provide such notice within such 30-day period shall be deemed to constitute a decision
by Tulsa Refining not to purchase the Sale Assets. If Tulsa Refining fails to exercise a right
during any applicable period set forth in this Section 4(b), Tulsa Refining shall be deemed
to have waived its rights with respect to such proposed disposition of the Sale Assets, but not
with respect to any future offer of Tulsa Loading Racks.

8

 

     (c) If Tulsa Refining chooses to exercise its right of first refusal to purchase the Sale
Assets under Section 4(b), Tulsa Refining and HEP Tulsa shall enter into a purchase and
sale agreement for the Sale Assets which, unless otherwise agreed to by Tulsa Refining and HEP
Tulsa shall include the following terms:

          (i) Tulsa Refining will agree to deliver cash for the Offer Price (or any other consideration
agreed to by Tulsa Refining and HEP Tulsa (each in their sole discretion));

          (ii) HEP Tulsa will represent that there are no liens on the Sale Assets (other than Permitted
Encumbrances) and that it has good and indefeasible title to the Sale Assets, subject to all
Permitted Encumbrances, matters recorded and physical conditions existing as of the date of this
Agreement, plus any other such matters as Tulsa Refining may approve, which approval will not be
unreasonably withheld;

          (iii) unless otherwise agreed to by the Parties, the closing date for the purchase of the Sale
Assets shall occur no later than 90 days following receipt by HEP Tulsa of written notice by Tulsa
Refining of its intention to exercise its option to purchase the Sale Assets pursuant to
Section 4(b);

          (iv) HEP Tulsa shall execute, have acknowledged and deliver to Tulsa Refining a bill of sale
or comparable document and, if applicable, a conveyance, special warranty deed, assignment of
easement, or comparable document, as appropriate, in the applicable jurisdiction, on the closing
date for the purchase of the Sale Assets conveying the Sale Assets unto Tulsa Refining free and
clear of all encumbrances created or allowed by HEP Tulsa other than those set forth in Section
4(c)(ii) above;

          (v) subject to the requirements set forth in Section 4(c)(ii) and Section
4(c)(iv), the sale of any Sale Assets shall be made on an “as is,” “where is” and “with all
faults” basis, and the instruments conveying such Sale Assets shall contain appropriate
disclaimers;

          (vi) the termination of the Tulsa Throughput Agreement;

          (vii) neither HEP Tulsa nor Tulsa Refining shall have any obligation to sell or buy the Sale
Assets if any required written consents of governmental authorities and other third parties have
not been obtained or such sale or purchase is prohibited by Applicable Law; and

          (viii) the sale of the Tulsa Loading Racks shall be subject to the receipt of any consents or
waivers required pursuant to the Amended and Restated Credit Agreement, dated as of August 27,
2007, among Holly Energy Partners — Operating, L.P., the Banks party thereto, and Union Bank,
N.A., as Administrative Agent, as such agreement may be amended, restated, otherwise modified or
refinanced from time to time.

     (d) Tulsa Refining and HEP Tulsa shall cooperate in good faith in obtaining all necessary
governmental and other third Person approvals, waivers and consents required for the closing. Any
such closing shall be delayed, to the extent required, until the third business day following the
expiration of any required waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended; provided, however, that such delay shall not exceed 120 days
and, if governmental approvals and waiting periods shall not have been obtained or expired,

9

 

as the case may be, by such 120th day, then Tulsa Refining may notify HEP Tulsa that it is
waiving its right to purchase the Sale Assets described in the Disposition Notice and thereafter
neither Tulsa Refining nor HEP Tulsa shall have any further obligation under this Section 4
with respect to such Sale Assets unless such Sale Assets again become subject to this Section
4 pursuant to Section 4(e).

     (e) If the Transfer to the Proposed Transferee is not consummated in accordance with the terms
of the Acquisition Proposal within the later of (i) 180 days after the later of the applicable ROFR
Acceptance Deadline, and (ii) 10 days after the satisfaction of all governmental approval or filing
requirements, if any, the Acquisition Proposal shall be deemed to lapse, and HEP Tulsa may not
Transfer any of the Sale Assets described in the Disposition Notice without complying again with
the provisions of this Section 4 if and to the extent then applicable.

     Section 5. HEP Tulsa Put Right

     (a) Tulsa Refining hereby grants to HEP Tulsa the unconditional right and option to sell to
Tulsa Refining for $100.00 (in accordance with this Section 5) all of HEP Tulsa’s, right
title and interest in, to and under the Tulsa Loading Racks. In the event HEP Tulsa desires to
exercise its option to sell the Tulsa Loading Racks pursuant to this Section 5(a), it shall
provide prior written notice to Tulsa Refining of its desire to so sell the Tulsa Loading Racks;
such written notice shall be provided not less than six (6) months prior to the date of termination
of this Agreement.

     (b) Notwithstanding the foregoing, in the event Tulsa Refining duly exercises its option to
sell the Real Property (as defined below) to HEP Tulsa pursuant to Section 6, then HEP
Tulsa shall have the unconditional right and option to sell to Tulsa Refining for $100.00 (in
accordance with this Section 5) all of HEP Tulsa’s, right title and interest in, to and
under the Tulsa Loading Racks; provided, that in the event HEP Tulsa desires to exercise its option
to sell the Tulsa Loading Racks pursuant to this Section 5(b), it must provide written
notice to Tulsa Refining of its desire to so sell the Tulsa Loading Racks within fifteen (15) days
following its receipt of the Real Property Put Right Notice (as defined below). Notwithstanding
anything in this Agreement to the contrary, in the event HEP Tulsa duly exercises its option to
sell all of HEP Tulsa’s, right title and interest in, to and under the Tulsa Loading Racks to Tulsa
Refining pursuant to this Section 5(b), then (i) Tulsa Refining’s exercise of its option to
sell the Real Property to HEP Tulsa pursuant to Section 6 shall automatically be voided and
of no further force and effect and (ii) (x) the provisions of Section 2, Section 3,
Section 4 and Section 6 shall terminate simultaneously with the termination of the
Tulsa Throughput Agreement and (y) the term of this Agreement shall be extended and this Agreement
shall terminate simultaneously with the closing of the sale of the Tulsa Loading Racks pursuant to
this Section 5.

     (c) If HEP Tulsa chooses to exercise its option to sell the Tulsa Loading Racks under this
Section 5, this Agreement shall become a contract of sale and purchase for the Tulsa
Loading Racks pursuant to which Tulsa Refining shall be obligated to purchase the Tulsa Loading
Racks from HEP Tulsa and HEP Tulsa shall be obligated to sell the Tulsa Loading Racks to Tulsa
Refining. The terms of the purchase and sale agreement, unless otherwise agreed to by Tulsa
Refining and HEP Tulsa, will include the following:

10

 

          (i) Tulsa Refining will deliver, or cause to be delivered, the $100.00 purchase price in cash
for the Tulsa Loading Racks, which will result in the termination of the Tulsa Throughput
Agreement;

          (ii) HEP Tulsa will represent that there are no liens on the Tulsa Loading Racks (other than
Permitted Encumbrances) and that it has good and indefeasible title to the Tulsa Loading Racks,
subject to all Permitted Encumbrances, matters recorded and physical conditions existing as of the
date of this Agreement, plus any other such matters as Tulsa Refining may approve, which approval
will not be unreasonably withheld;

          (iii) unless otherwise agreed to by the Parties, the closing date for the purchase of the
Tulsa Loading Racks shall occur on the date of termination of this Agreement;

          (iv) HEP Tulsa shall execute, have acknowledged and deliver to Tulsa Refining a bill of sale
or comparable document and, if applicable, a conveyance, special warranty deed, assignment of
easement, or comparable document, as appropriate, in the applicable jurisdiction, on the closing
date for the sale of the Tulsa Loading Racks conveying the Tulsa Loading Racks unto Tulsa Refining
free and clear of all encumbrances created or allowed by HEP Tulsa other than those set forth in
Section 5(c)(ii) above;

          (v) subject to the requirements set forth in Section 5(c)(ii) and Section
5(c)(iv), the sale of the Tulsa Loading Racks shall be made on an “as is,” “where is” and “with
all faults” basis, and the instruments conveying the Tulsa Loading Racks shall contain appropriate
disclaimers;

          (vi) the termination of the Tulsa Throughput Agreement;

          (vii) neither HEP Tulsa nor Tulsa Refining shall have any obligation to sell or buy the Tulsa
Loading Racks if any required written consents of governmental authorities and other third parties
have not been obtained or such sale or purchase is prohibited by Applicable Law; and

          (viii) the sale of the Tulsa Loading Racks shall be subject to the receipt of any consents or
waivers required pursuant to the Amended and Restated Credit Agreement, dated as of August 27,
2007, among Holly Energy Partners — Operating, L.P., the Banks party thereto, and Union Bank,
N.A., as Administrative Agent, as such agreement may be amended, restated, otherwise modified or
refinanced from time to time.

     (d) Tulsa Refining and HEP Tulsa shall cooperate in good faith in obtaining all necessary
governmental and other third Person approvals, waivers and consents required for the closing. Any
such closing shall be delayed, to the extent required, until the third business day following the
expiration of any required waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended; provided, however, that such delay shall not exceed 120 days
and, if governmental approvals and waiting periods shall not have been obtained or expired, as the
case may be, by such 120th day, then HEP Tulsa may notify Tulsa Refining that it is waiving its
option to sell the Tulsa Loading Racks and thereafter neither Tulsa Refining nor HEP Tulsa shall
have any further obligation under this Section 5 with respect to HEP Tulsa’s prior election
to sell the Tulsa Loading Racks.

11

 

     Section 6. Tulsa Refining Put Right of Real Property

     (a) Subject to Section 5(b), HEP Tulsa hereby grants to Tulsa Refining the
unconditional right and option to sell to HEP Tulsa for $100.00 (in accordance with this
Section 6) all of Tulsa Refining’s, right, title and interest in, to and under the real
property located directly under the Tulsa Loading Racks (the “Real Property”); provided
that such right shall not be exercisable (i) if Tulsa Refining has exercised its option to purchase
the Tulsa Loading Racks pursuant to Section 2 or Section 3, (ii) if HEP Tulsa has
exercised its right to sell the Tulsa Loading Racks to Tulsa Refining pursuant to Section
5(a), (iii) with respect to the real property underlying the Sale Assets which Tulsa Refining
has exercised its right of first refusal to purchase pursuant to Section 4, or (iv) at any
time prior to that date which is six (6) months prior to the date of scheduled termination of this
Agreement. In the event Tulsa Refining desires to exercise its option to sell the Real Property
pursuant to this Section 6, it shall provide written notice to HEP Tulsa (the “Real
Property Put Right Notice”) of its desire to so sell the Real Property not more than six (6)
months and not less than twenty (20) days prior to the date of termination of this Agreement. In
the event Tulsa Refining notifies HEP Tulsa of its desire to exercise its put right under this
Section 6, then, notwithstanding Section 8, but subject to Section 5(b),
(x) the provisions of Section 2, Section 3, Section 4 and Section 5
shall terminate simultaneously with the termination of the Tulsa Throughput Agreement and (y) the
term of this Agreement shall be extended and this Agreement shall terminate simultaneously with the
closing of the sale of the Real Property pursuant to this Section 6.

     (b) If Tulsa Refining chooses to exercise its option to sell the Real Property under this
Section 6, this Agreement shall become a contract of sale and purchase for the Real
Property pursuant to which HEP Tulsa shall be obligated to purchase the Real Property from Tulsa
Refining and Tulsa Refining shall be obligated to sell the Real Property to HEP Tulsa. The terms of
the purchase and sale agreement, unless otherwise agreed to by Tulsa Refining and HEP Tulsa, will
include the following:

          (i) HEP Tulsa will deliver, or cause to be delivered, the $100.00 purchase price in cash for
the Real Property, which will result in the termination of the Tulsa Throughput Agreement;

          (ii) Tulsa Refining will represent that it has good and indefeasible title to the Real
Property, subject to all recorded matters and all physical conditions in existence on the closing
date for such sale to HEP Tulsa of the Real Property, plus any other such matters as HEP Tulsa may
approve in writing, which approval will not be unreasonably withheld;

          (iii) unless otherwise agreed to by the Parties, the closing date for the purchase of the Real
Property shall occur no later than the latter of (A) 90 days following receipt by HEP Tulsa of
written notice by Tulsa Refining of its intention to exercise its option to sell the Real Property
pursuant to this Section 6 and (B) 15 days following receipt by Tulsa Refining and/or HEP
Tulsa of all necessary consents, approvals, or permits necessary to convey the Real Property to HEP
Tulsa as set out in this Section 6;

          (iv) Tulsa Refining, at its expense, shall cause the Real Property to be subdivided if and as
to the extent required under applicable law, taxed as one or more separate

12

 

tax parcels distinct from any other portion of the Tulsa Refinery, and otherwise cause the
Real Property to comply with all legal requirements necessary to convey fee title of the Real
Property to HEP Tulsa, and HEP Tulsa shall reasonably cooperate with respect thereto; the terms and
conditions of this Section 6(b)(iv) shall survive the closing and the delivery of the deed
contemplated under this Section 6;

          (v) Tulsa Refining shall execute, have acknowledged and deliver to HEP Tulsa (A) a special
warranty deed on the closing date for the sale of the Real Property conveying the Real Property
unto HEP Tulsa free and clear of all encumbrances created or allowed by Tulsa Refining other than
those set forth in Section 6(b)(ii) above and reserving for Tulsa Refining an easement in,
on, under and over the Real Property for the use, operation, maintenance, repair, replacement, and
location of any rail lines existing as of the date of such conveyance, and (B) an access agreement
in favor of HEP Tulsa granting access rights comparable to the access rights granted in the License
Agreement and otherwise reasonably acceptable to both HEP Tulsa and Tulsa Refining;

          (vi) subject to the requirements set forth in Section 6(b)(ii) and Section
6(b)(v)(A), the sale of the Real Property shall be made on an “as is,” “where is” and “with all
faults” basis, and the instruments conveying the Real Property shall contain appropriate
disclaimers;

          (vii) the termination of the Tulsa Throughput Agreement, if applicable;

          (viii) neither HEP Tulsa nor Tulsa Refining shall have any obligation to sell or buy the Real
Property if any required written consents of governmental authorities and other third parties have
not been obtained or such sale or purchase is prohibited by Applicable Law; and

          (ix) the sale of the Real Property shall be subject to the receipt of any consents or waivers
required pursuant to the Second Amended and Restated Credit Agreement, dated as of April 7, 2009,
among Holly Corporation, Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C
Issuer, UBS Loan Finance LLC and U.S. Bank National Association, as Co-Documentation Agents, and
Union Bank of California, N.A. and Compass Bank, as Syndication Agents, as such agreement may be
amended, restated, otherwise modified or refinanced from time to time.

     (c) Tulsa Refining and HEP Tulsa shall cooperate in good faith in obtaining all necessary
governmental and other third Person approvals, waivers and consents required for the closing. Any
such closing shall be delayed, to the extent required, until the third business day following the
expiration of any required waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended; provided, however, that such delay shall not exceed 120 days
and, if governmental approvals and waiting periods shall not have been obtained or expired, as the
case may be, by such 120th day, then Tulsa Refining may notify HEP Tulsa that it is waiving its
option to sell the Real Property and thereafter neither Tulsa Refining nor HEP Tulsa shall have any
further obligation under this Section 6 with respect to Tulsa Refining’s prior election to
sell the Tulsa Loading Racks.

13

 

     (d) At the request of either party hereto, Tulsa Refining and HEP Tulsa shall execute and
acknowledge a memorandum evidencing the existence of the put option rights and obligations under
this Section 6, such memorandum to be in a form that can be recorded in the real property
records of Tulsa County, Oklahoma and otherwise reasonably acceptable to each party; thereafter the
party requesting such memorandum shall be authorized and permitted to record such memorandum in the
real property records of Tulsa County, Oklahoma.

     Section 7. Required Action; No Other Rights

     The Parties agree that they will cooperate with the reasonable due diligence efforts of any
Person acquiring the Tulsa Loading Racks pursuant to any Party’s exercise of its rights under this
Agreement to purchase or sell the Tulsa Loading Racks.

     Section 8. Effectiveness and Term

     This Agreement shall be effective as of August 1, 2009 and shall terminate simultaneously with
the termination of the Tulsa Throughput Agreement, including an extensions or amendments of such
agreement, unless extended by written mutual agreement of the Parties hereto.

     Section 9. Notices

     (a) Any notice or other communication given under this Agreement shall be in writing and shall
be (i) delivered personally, (ii) sent by documented overnight delivery service, (iii) sent by
email transmission, or (iv) sent by first class mail, postage prepaid (certified or registered
mail, return receipt requested). Such notice shall be deemed to have been duly given (x) if
received, on the date of the delivery, with a receipt for delivery, (y) if refused, on the date of
the refused delivery, with a receipt for refusal, or (z) with respect to email transmissions, on
the date the recipient confirms receipt. Notices or other communications shall be directed to the
following addresses:

Notices to Tulsa Refining:

Holly Refining & Marketing — Tulsa LLC

100 Crescent Court, Suite 1600

Dallas, Texas 75201

Attn: David L. Lamp

Email address: president@hollycorp.com

with a copy, which shall not constitute notice, but is required in

order to give proper notice, to:

14

 

Holly Refining & Marketing — Tulsa LLC

100 Crescent Court, Suite 1600

Dallas, Texas 75201

Attn: General Counsel

Email address: generalcounsel@hollycorp.com

Notices to HEP Tulsa:

HEP Tulsa LLC

100 Crescent Court, Suite 1600

Dallas, Texas 75201

Attn: David G. Blair

Email address: SVP-HEP@hollyenergy.com

with a copy, which shall not constitute notice, but is required in

order to give proper notice, to:

HEP Tulsa LLC

100 Crescent Court, Suite 1600

Dallas, Texas 75201

Attn: General Counsel

Email address: generalcounsel@hollycorp.com

     (b) Either Party may at any time change its address for service from time to time by giving
notice to the other Party in accordance with this Section 9.

     Section 10. Miscellaneous

     (a) Amendments and Waivers. No amendment or modification of this Agreement shall be
valid unless it is in writing and signed by the Parties. No waiver of any provision of this
Agreement shall be valid unless it is in writing and signed by the party against whom the waiver is
sought to be enforced. Any of the exhibits or schedules to this Agreement may be amended,
modified, revised or updated by the Parties if each of the Parties execute an amended, modified,
revised or updated exhibit or schedule, as applicable, and attach it to this Agreement. Such
amended, modified, revised or updated exhibits or schedules shall be sequentially numbered (e.g.
Exhibit A-1, Exhibit A-2, etc.), dated and appended as an additional exhibit or schedule to this
Agreement and shall replace the prior exhibit or schedule, as applicable, in its entirety, except
as specified therein. No failure or delay in exercising any right hereunder, and no course of
conduct, shall operate as a waiver of any provision of this Agreement. No single or partial
exercise of a right hereunder shall preclude further or complete exercise of that right or any
other right hereunder.

     (b) Successors and Assigns.

          (i) This Agreement shall inure to the benefit of, and shall be binding upon, Tulsa Refining,
HEP Tulsa and their respective successors and permitted assigns. Neither this Agreement nor any of
the rights or obligations hereunder shall be assigned without the prior

15

 

written consent of Tulsa Refining (in the case of any assignment by HEP Tulsa) or HEP Tulsa
(in the case of any assignment by Tulsa Refining); provided, however, that (i) HEP
Tulsa may make such an assignment (including a partial pro rata assignment) to an Affiliate of HEP
Tulsa without Tulsa Refining’s consent, (ii) Tulsa Refining may make such an assignment (including
a pro rata partial assignment) to an Affiliate of Tulsa Refining without HEP Tulsa’s consent, (iii)
Tulsa Refining may make a collateral assignment of its rights and obligations hereunder and/or
grant a security interest in its rights and obligations to all or a portion of the Tulsa Loading
Racks to any bona fide third party lender or debt holder, or trustee or representative for any of
them without HEP Tulsa’s consent, (iv) HEP Tulsa may make a collateral assignment of its rights
hereunder and/or grant a security interest in all or a portion of the Tulsa Loading Racks to a bona
fide third party lender or debt holder, or trustee or representative for any of them without Tulsa
Refining’s consent, if such third party lender, debt holder or trustee shall have executed and
delivered to Tulsa Refining a non-disturbance agreement in such form as is reasonably satisfactory
to Tulsa Refining and such third party lender, debt holder, or trustee, (v) HEP Tulsa may assign
all of its rights and obligations under this Agreement to any Person to whom it transfers the Tulsa
Loading Racks without Tulsa Refining’s consent, and (vi) Tulsa Refining may assign all of its
rights and obligations under this Agreement to any third party(ies) that acquire the Tulsa Refinery
without HEP Tulsa’s consent. Any attempt to make an assignment otherwise than as permitted by the
foregoing shall be null and void. The Parties agree to require their respective successors, if
any, to expressly assume, in a form of agreement reasonably acceptable to the other Party, their
obligations under this Agreement.

          (ii) HEP Tulsa agrees that it will require any Person to whom it transfers the Tulsa Loading
Racks to expressly assume all of HEP Tulsa’s obligations under this Agreement and the Tulsa
Throughput Agreement, in a form of agreement reasonably acceptable to Tulsa Refining.

     (c) Severability. If any provision of this Agreement shall be held invalid or
unenforceable by a court or regulatory body of competent jurisdiction, the remainder of this
Agreement shall remain in full force and effect.

     (d) Choice of Law. This Agreement shall be subject to and governed by the laws of the
State of Delaware, excluding any conflicts-of-law rule or principle that might refer the
construction or interpretation of this Agreement to the laws of another state.

     (e) Arbitration Provision. Except as permitted under Section 10(i), any and
all Arbitrable Disputes must be resolved through the use of binding arbitration using three
arbitrators, in accordance with the Commercial Arbitration Rules of the American Arbitration
Association, as supplemented to the extent necessary to determine any procedural appeal questions
by the Federal Arbitration Act (Title 9 of the United States Code). If there is any inconsistency
between this Section 10(e) and the Commercial Arbitration Rules or the Federal Arbitration
Act, the terms of this Section 10(e) will control the rights and obligations of the
Parties. Arbitration must be initiated within the time limits set forth in this Agreement, or if
no such limits apply, then within a reasonable time or the time period allowed by the applicable
statute of limitations. Arbitration may be initiated by a Party (“Claimant”) serving
written notice on the other Party (“Respondent”) that the Claimant elects to refer the
Arbitrable Dispute to binding arbitration. Claimant’s notice initiating binding arbitration must
identify the arbitrator

16

 

Claimant has appointed. The Respondent shall respond to Claimant within thirty (30) days
after receipt of Claimant’s notice, identifying the arbitrator Respondent has appointed. If the
Respondent fails for any reason to name an arbitrator within the 30-day period, Claimant shall
petition the American Arbitration Association for appointment of an arbitrator for Respondent’s
account. The two arbitrators so chosen shall select a third arbitrator within thirty (30) days
after the second arbitrator has been appointed. The Claimant will pay the compensation and
expenses of the arbitrator named by it, and the Respondent will pay the compensation and expenses
of the arbitrator named by or for it. The costs of petitioning for the appointment of an
arbitrator, if any, shall be paid by Respondent. The Claimant and Respondent will each pay
one-half of the compensation and expenses of the third arbitrator. All arbitrators must (i) be
neutral parties who have never been officers, directors or employees of any of Tulsa Refining, HEP
Tulsa or any of their Affiliates and (ii) have not less than seven (7) years experience in the
energy industry. The hearing will be conducted in Dallas, Texas and commence within thirty (30)
days after the selection of the third arbitrator. Tulsa Refining, HEP Tulsa and the arbitrators
shall proceed diligently and in good faith in order that the award may be made as promptly as
possible. Except as provided in the Federal Arbitration Act, the decision of the arbitrators will
be binding on and non-appealable by the Parties hereto. The arbitrators shall have no right to
grant or award indirect, consequential, punitive or exemplary damages of any kind. The Arbitrable
Disputes may be arbitrated in a common proceeding along with disputes under other agreements
between Tulsa Refining, HEP Tulsa or their Affiliates to the extent that the issues raised in such
disputes are related. Without the written consent of the Parties, no unrelated disputes or third
party disputes may be joined to an arbitration pursuant to this Agreement.

     (f) Further Assurances. In connection with this Agreement and all transactions
contemplated by this Agreement, each signatory Party hereto agrees to execute and deliver such
additional documents and instruments and to perform such additional acts as may be necessary or
appropriate to effectuate, carry out and perform all of the terms, provisions and conditions of
this Agreement and all such transactions.

     (g) Headings. Headings of the Sections of this Agreement are for convenience of the
Parties only and shall be given no substantive or interpretative effect whatsoever. All references
in this Agreement to Sections are to Sections of this Agreement unless otherwise stated.

     (h) Limitation of Damages. NOTWITHSTANDING ANYTHING CONTAINED TO THE CONTRARY IN ANY
OTHER PROVISION OF THIS AGREEMENT AND EXCEPT FOR CLAIMS MADE BY THIRD PARTIES WHICH SHALL NOT BE
LIMITED BY THIS PARAGRAPH, THE PARTIES AGREE THAT THE RECOVERY BY ANY PARTY OF ANY LIABILITIES,
DAMAGES, COSTS OR OTHER EXPENSES SUFFERED OR INCURRED BY IT AS A RESULT OF ANY BREACH OR
NONFULFILLMENT BY A PARTY OF ANY OF ITS REPRESENTATIONS, WARRANTIES, COVENANTS, AGREEMENTS OR OTHER
OBLIGATIONS UNDER THIS AGREEMENT, SHALL BE LIMITED TO ACTUAL DAMAGES AND SHALL NOT INCLUDE OR APPLY
TO, NOR SHALL ANY PARTY BE ENTITLED TO RECOVER, ANY INDIRECT, CONSEQUENTIAL, EXEMPLARY OR PUNITIVE
DAMAGES (INCLUDING, WITHOUT LIMITATION, ANY DAMAGES ON ACCOUNT OF LOST PROFITS OR OPPORTUNITIES OR
BUSINESS INTERRUPTION OR DIMINUTION IN VALUE) SUFFERED OR INCURRED BY ANY PARTY; PROVIDED,
HOWEVER, THAT SUCH RESTRICTION AND LIMITATION SHALL NOT APPLY TO

17

 

(x) A THIRD PARTY CLAIM FOR SUCH INDIRECT, CONSEQUENTIAL, EXEMPLARY OR PUNITIVE DAMAGES OR (y)
INDIRECT, CONSEQUENTIAL, EXEMPLARY OR PUNITIVE DAMAGES THAT ARE A RESULT OF THE GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT OF THE OTHER PARTY OR ITS AFFILIATES (INCLUDING, WITHOUT LIMITATION, ANY DAMAGES
ON ACCOUNT OF LOST PROFITS OR OPPORTUNITIES OR BUSINESS INTERRUPTION OR DIMINUTION IN VALUE).

     (i) Security Agreement. This Agreement constitutes a “Security Agreement” on the
Tulsa Loading Racks as personal property within the meaning of the UCC and other applicable law.
To this end, HEP Tulsa grants to Tulsa Refining a security interest in the Tulsa Loading Racks to
secure the performance of HEP Tulsa hereunder, and agrees that Tulsa Refining shall have all the
rights and remedies of a secured party under the UCC with respect to the Tulsa Loading Racks. If
HEP Tulsa fails to convey, transfer and assign the Tulsa Loading Racks in accordance with the
provisions of this Agreement, then Tulsa Refining shall be permitted to foreclose on the Tulsa
Loading Racks in accordance with and as permitted under the UCC. Any notice of sale, disposition
or other intended action by Tulsa Refining with respect to the Tulsa Loading Racks sent to HEP
Tulsa at least ten (10) days prior to any action under the UCC shall constitute reasonable notice
to HEP Tulsa. HEP Tulsa hereby irrevocably authorizes Tulsa Refining at any time and from time to
file in any filing office in any UCC jurisdiction one or more financing or continuation statements
and amendments thereto, relative to all or any part of the Tulsa Loading Racks, without the
signature of HEP Tulsa where permitted by law. Tulsa Refining acknowledges and agrees that its
security interest in the Tulsa Loading Racks granted hereunder (i) is automatically subordinate to
the security interest of Union Bank, N.A. in the Tulsa Loading Racks until the termination or
expiration of the Amended and Restated Credit Agreement dated as of August 27, 2007, as amended
from time to time, among Holly Energy Partners — Operating, L.P., as Borrower, the financial
institutions party thereto, and Union Bank, N.A., formerly known as Union Bank of California, N.A.,
as Administrative Agent, Issuing Bank and Sole Lead Arranger and (ii) is subject to any
Subordination, Non-Disturbance and Attornment Agreement entered into among Union Bank, N.A., as
administrative agent, and Tulsa Refining. Tulsa Refining further agrees to subordinate its
security interest in the Tulsa Loading Racks granted hereunder to any future security interest in
the Tulsa Loading Racks granted by HEP Tulsa in favor of any third-party providing financing to HEP
Tulsa, so long as the holder of such future financing executes and delivers to Tulsa Refining a
subordination, non-disturbance and attornment agreement recognizing and agreeing not to disturb
Tulsa Refining’s rights under this Agreement and the Tulsa Throughput Agreement, and otherwise
being in form and substance reasonably acceptable to Tulsa Refining.

[Remainder of Page Intentionally Left Blank]

18

 

     IN WITNESS WHEREOF, the undersigned Parties have executed this Agreement as of the date first
written above.

	 	 	 	 	 
	 	HOLLY REFINING & MARKETING

— TULSA LLC

 	 
	 	By:  	/s/ David L. Lamp
 	 
	 	 	David L. Lamp 	 
	 	 	President 	 
	 
	 	HEP TULSA LLC

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

Signature Page 1 of 1 to the Tulsa Purchase Option Agreement

 

 

EXHIBIT A

SUMMARY OF EXERCISABILITY OF THE PURCHASE OPTION AND PUT RIGHTS

     For ease of reference, following is a summary of the time of exercisability of the purchase
option pursuant to Section 2 and the put rights pursuant to Section 5 and
Section 6:

	 	•	 	Pursuant to Section 2, Tulsa Refining may elect to purchase the Tulsa
Loading Racks by providing prior written notice to HEP Tulsa of its desire to so
purchase the Tulsa Loading Racks not more than twenty-four (24) months and not less
than twelve (12) months prior to the date of termination of this Agreement.
	 
	 	•	 	Pursuant to Section 5(a), HEP Tulsa may elect to sell the Tulsa Loading
Racks to Tulsa Refining by providing prior written notice to Tulsa Refining of its
desire to so sell the Tulsa Loading Racks not less than six (6) months prior to the
date of termination of this Agreement.
	 
	 	•	 	Pursuant to Section 6, Tulsa Refining may elect to sell the Real
Property to HEP Tulsa by providing prior written notice to HEP Tulsa of its desire
to so sell the Real Property not more than six (6) months and not less than twenty
(20) days prior to the date of termination of this Agreement. Tulsa Refining’s
option to sell the Real Property to HEP Tulsa may not be exercised (i) if Tulsa
Refining has exercised its option to purchase the Tulsa Loading Racks pursuant to
Section 2 or Section 3, (ii) if HEP Tulsa has exercised its right
to sell the Tulsa Loading Racks to Tulsa Refining pursuant to Section 5(a),
(iii) with respect to the real property underlying the Sale Assets which Tulsa
Refining has exercised its right of first refusal to purchase pursuant to
Section 4, or (iv) at any time prior to that date which is six (6) months
prior to the date of scheduled termination of this Agreement.
	 
	 	•	 	Pursuant to Section 5(b), if Tulsa Refining has exercised its option
pursuant to Section 6 to sell the Real Property to HEP Tulsa, then HEP
Tulsa may elect to sell the Tulsa Loading Racks to Tulsa Refining by providing
written notice to Tulsa Refining of its desire to so sell the Tulsa Loading Racks
within fifteen (15) days following its receipt of the Real Property Put Right
Notice. In the event HEP Tulsa duly exercises its option to sell the Tulsa Loading
Racks to Tulsa Refining pursuant to Section 5(b), then Tulsa Refining’s
exercise of its option to sell the Real Property to HEP Tulsa pursuant to
Section 6 shall automatically be voided and of no further force and effect.

In the event of any conflict between the terms of this Exhibit A and the terms of
Section 2, Section 5 or Section 6, the terms and provisions of Section
2, Section 5 and Section 6, as applicable, shall control.

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