Document:

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                                                                    EXHIBIT 10.2

                         EXECUTIVE EMPLOYMENT AGREEMENT

         This Employment Agreement ("Agreement"), including the attached Exhibit
"A", is entered into between EOTT ENERGY LLC, a Delaware corporation, having
offices at 2000 W. Sam Houston Parkway S., Suite 400, Houston, Texas 77042
("Employer" and "Company"), and Thomas M. Matthews, an individual currently
residing at 17402 Ridge Top Drive, Houston, Texas 77090 ("Employee"), to be
effective as of July 1, 2003 (the "Effective Date").

                                   WITNESSETH:

         WHEREAS, Employer is desirous of employing Employee pursuant to the
terms and conditions and for the consideration set forth in this Agreement, and
Employee is desirous of entering employment with the Employer pursuant to such
terms and conditions and for such consideration.

         NOW, THEREFORE, for and in consideration of the mutual promises,
covenants, and obligations contained herein, Employer and Employee agree as
follows:

ARTICLE 1: EMPLOYMENT AND DUTIES:

         1.1.     Employer agrees to employ Employee, and Employee agrees to be
employed by Employer, beginning as of the Effective Date of this Agreement and
continuing until the date set forth on Exhibit "A" (the "Term"), subject to the
terms and conditions of this Agreement. This Agreement will expire by its own
terms and the Employee will automatically become an employee at will and be
included in all general employment and benefit arrangements at the end of the
Term unless the Company notifies Employee of its intention to extend the Term
(such notice to include the length of the intended extension) at least sixty
(60) days prior to the expiration of the Term and Employee accepts such
extension within ten (10) days of receipt of such notice.

         1.2.     Employee shall be employed in the position set forth on
Exhibit "A". Employee agrees to serve in the assigned position and to perform
diligently and to the best of Employee's abilities the duties and services
appertaining to such position as determined by Employer, as well as such
additional or different duties and services appropriate to such position which
Employee from time to time may be reasonably directed to perform by Employer.
Employee shall at all times comply with and be subject to such policies and
procedures as Employer may establish from time to time.

         1.3.     Employee shall, during the period of Employee's employment by
Employer, devote Employee's full business time, energy, and best efforts to the
business and affairs of Employer. Employee may not engage, directly or
indirectly, in any other business, investment, or activity that interferes with
Employee's performance of Employee's duties hereunder, is contrary to the
interests of Employer, or requires any significant portion of Employee's
business time. The activities described as "permitted activities," on Exhibit A
attached hereto shall not be deemed a violation of this Section 1.3.

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         1.4.     Employee acknowledges and agrees that Employee owes a
fiduciary duty of loyalty, fidelity and allegiance to act at all times in the
best interests of the Employer and to do no act which would injure Employer's
business, its interests, or its reputation. Employee agrees to comply with the
policies and procedures as described and contained in the Employer's Code of
Ethics policy, a copy of which has been provided to Employee.

ARTICLE 2: COMPENSATION AND BENEFITS:

         2.1.     Employee shall be paid as set forth on Exhibit "A". Employee's
monthly base salary shall be paid in semimonthly installments in accordance with
Employer's standard payroll practice, and (as with all other payments made to
Employee by Employer) is subject to withholding of all federal, state, city, or
other taxes as may be required by law.

         2.2.     While employed by Employer (both during the Term and
thereafter), Employee shall be allowed to participate, on the same basis
generally as other employees of Employer, in all general employee benefit plans
and programs, including improvements or modifications of the same, which on the
effective date or thereafter are made available by Employer to all or
substantially all of Employer's employees. Such benefits, plans, and programs
may include, without limitation, medical, dental care, life insurance,
disability protection, and qualified plans. Nothing in this Agreement is to be
construed or interpreted to provide greater rights, participation, coverage, or
benefits under such benefit plans or programs than provided to similarly
situated employees pursuant to the terms and conditions of such benefit plans
and programs, except as may be approved by Employer's compensation committee and
Board of Directors.

         2.3.     Employee shall be eligible to participate in the Employer's
long-term incentive plans and Employer's annual incentive plan currently
maintained or hereafter maintained by Employer for its officers as a group.

         2.4.     Employer shall not by reason of this Article 2 be obligated to
institute, maintain, or refrain from changing, amending, or discontinuing, any
such incentive compensation or employee benefit program or plan, so long as such
actions or inactions are similarly applicable to covered employees generally.
Moreover, unless specifically provided for in a written plan document adopted by
the Board of Directors of Employer, none of the benefits or arrangements
described in this Article 2 shall be secured or funded in any way, and each
shall instead constitute an unfunded and unsecured promise to pay money in the
future exclusively from the general assets of Employer.

         2.5.     Employer may withhold from any compensation, benefits, or
amounts payable under this Agreement all federal, state, city, or other taxes as
may be required by law.

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ARTICLE 3: TERMINATION PRIOR TO EXPIRATION OF TERM AND EFFECTS OF SUCH
           TERMINATION:

         3.1.     Notwithstanding any other provisions of this Agreement,
Employer shall have the right to terminate Employee's employment under this
Agreement at any time prior to the expiration of the Term for any of the
following reasons:

         (i)      For "cause" upon the determination by the Employer's
                  Independent Directors of the Board who are neither employees
                  of nor Affiliated with Employer or any subsidiary of Employer
                  apart from his or her capacity as a member of the Board and
                  any Board committee and who otherwise have no interest in such
                  determination ("Independent Directors") that "cause" exists
                  for the termination of the employment relationship. As used in
                  this Section 3.1(i), the term "cause" shall mean [a]
                  Employee's gross negligence or willful misconduct in the
                  performance of the duties and services required of Employee
                  pursuant to this Agreement; or [b] Employee's final conviction
                  of a felony or of a misdemeanor involving moral turpitude; [c]
                  Employee's involvement in a conflict of interest as referenced
                  in Sections 1.3 and 1.4 with respect to which Employer makes a
                  good faith determination to terminate the employment of
                  Employee; or [d] Employee's material breach of any material
                  provision of this Agreement which remains uncorrected for
                  thirty (30) days following written notice to Employee by
                  Employer of such breach. It is expressly acknowledged and
                  agreed that the decision as to whether "cause" exists for
                  termination of the employment relationship by Employer is
                  delegated to the Independent Directors of the Board of
                  Employer for determination;

         (ii)     for any other reason whatsoever, with or without cause, in the
                  sole discretion of the Employer's Independent Directors of the
                  Board;

         (iii)    upon Employee's death; or

         (iv)     to the extent allowed by law, upon Employee's becoming
                  incapacitated by accident, sickness, or other circumstance
                  which renders him or her mentally or physically incapable of
                  performing the duties and services required of Employee, as
                  determined in good faith by Employer.

The termination of Employee's employment by Employer prior to the expiration of
the Term shall constitute a "Termination for Cause" if made pursuant to Section
3.1(i); the effect of such termination is specified in Section 3.4. The
termination of Employee's employment by Employer prior to the expiration of the
Term shall constitute an "Involuntary Termination" if made pursuant to Section
3.1(ii); the effect of such termination is specified in Section 3.5. The effect
of the employment relationship being terminated pursuant to Section 3.1(iii) as
a result of Employee's death is specified in Section 3.6. The effect of the
employment relationship being terminated pursuant to Section 3.1(iv) as a result
of the Employee becoming incapacitated is specified in Section 3.7.

         3.2.     Notwithstanding any other provisions of this Agreement except
Section 8.5, Employee shall have the right to terminate the employment
relationship under this Agreement at any time prior to the expiration of the
Term of employment for any of the following reasons:

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         (i)      a material breach by Employer of any material provision of
                  this Agreement or the occurrence of an Involuntary Termination
                  as defined in Section 3.5 which remains uncorrected for 30
                  days following written notice of such breach by Employee to
                  Employer; or

         (ii)     for any other reason whatsoever, in the sole discretion of
                  Employee.

The termination of Employee's employment by Employee prior to the expiration of
the Term shall constitute an "Involuntary Termination" if made pursuant to
Section 3.2(i); the effect of such termination is specified in Section 3.5. The
termination of Employee's employment by Employee prior to the expiration of the
Term shall constitute a "Voluntary Termination" if made pursuant to Section
3.2(ii); the effect of such termination is specified in Section 3.3.

         3.3.     Upon a "Voluntary Termination" of the employment relationship
by Employee prior to expiration of the Term, all future compensation to which
Employee is entitled and all future benefits for which Employee is eligible
shall cease and terminate as of the date of termination. Employee shall be
entitled to pro rata salary and accrued benefits through the date of such
termination, but Employee shall not be entitled to any bonuses or incentive
compensation not yet paid at the date of such termination.

         3.4.     If Employee's employment hereunder shall be terminated by
Employer for Cause prior to expiration of the Term, all future compensation to
which Employee is entitled and all future benefits for which Employee is
eligible shall cease and terminate as of the date of termination. Employee shall
be entitled to pro rata salary and accrued benefits through the date of such
termination, but Employee shall not be entitled to any bonuses or incentive
compensation not yet paid at the date of such termination.

         3.5.     Upon an Involuntary Termination of the employment relationship
by either Employer or Employee prior to expiration of the Term, Employee shall
be entitled, after execution of a Waiver and Release Agreement in consideration
of Employee's continuing obligations hereunder after such termination
(including, without limitation, Employee's non-competition obligations), to the
sum of two years annual base salary payable as follows: one year's annual base
salary shall be paid within thirty (30) days of the termination date; the
remaining one year's annual base salary shall be paid at the end of the twelve
(12) month period following the termination date. As used in this Agreement,
"Involuntary Termination" shall also mean termination of Employee's employment
with Employer if such termination results from:

         (i)      termination by Employee within 90 days of and in connection
                  with or based upon any of the following:

                  (a)      a substantial and/or material reduction in the nature
                           or scope of Employee's duties and/or responsibilities
                           as such duties are constituted as of the effective
                           date of this Agreement or later agreed to by Employee
                           and Employer, or if Employee is no longer an
                           executive officer of the Company as defined as
                           Section 16b in SEC regulations, which reduction
                           remains in place and uncorrected for thirty(30) days
                           following written notice of such breach to Employer
                           by Employee;

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                  (b)      a reduction in Employee's base pay or an exclusion
                           from a benefit plan or programs (except as part of a
                           general cutback for all employees or officers);

                  (c)      a change in the location for the primary performance
                           of Employee's services under this Agreement from the
                           city in which Employee was serving at the time of
                           notification to a city which is more than 100 miles
                           away from such location, which change is not approved
                           by Employee;

         (ii)     termination by Employee within one (1) year of Change of
                  Control Date:

                  (a)      "Change of Control" of Company shall mean

                           (i)      Company merges or consolidates with any
                                    other entity (other than one of EOTT Energy
                                    LLC's majority owned subsidiaries) and the
                                    shareholders of EOTT Energy LLC own less
                                    than 50% of the surviving entity,

                           (ii)     Company sells all or substantially all of
                                    its assets to any other person or entity
                                    (other than (i) a sale of equity interests
                                    in EOTT Energy LLC or (ii) a sale of assets
                                    to another majority owned subsidiary of EOTT
                                    Energy LLC and in connection therewith
                                    Employee becomes employed by such
                                    subsidiary, EOTT Energy LLC or a partnership
                                    in which EOTT Energy LLC is the general
                                    partner),

                           (iii)    Company is dissolved,

                           (iv)     any third person or entity together with its
                                    Affiliates shall become, directly or
                                    indirectly, the Beneficial Owner of greater
                                    than 50% of the voting stock of Company
                                    (except as the result of a distribution of
                                    the voting securities of the Company to the
                                    shareholders), or if

                           (v)      during such time as Company has a class of
                                    Voting Securities registered under the
                                    Securities Exchange Act of 1934, the
                                    individuals who constituted the members of
                                    the Company's Board of Directors ("Incumbent
                                    Board") upon the effective date of such
                                    registration cease for any reason to
                                    constitute at least a majority thereof,
                                    provided that any person becoming a director
                                    whose election or nomination for election by
                                    Company stockholders was approved by a vote
                                    of at least two thirds (2/3) of the
                                    directors comprising the Incumbent Board
                                    (either by a specific vote or by approval of
                                    the proxy statement of the Company in which
                                    such person is named as a nominee for
                                    director, without objection to such
                                    nomination) shall be, for purposes of this
                                    clause (v), considered as though such person
                                    were a member of the Incumbent Board.

                  (b)      "Change of Control Date" shall mean the day on which
                           a Change of Control becomes effective.

Employee shall not be under any duty or obligation to seek or accept other
employment following Involuntary Termination and the amounts due Employee
hereunder shall not be reduced or suspended if Employee accepts subsequent
employment. Employee's rights under this Section 3.5 are Employee's sole

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and exclusive rights against Employer, or its Affiliates, and Employer's sole
and exclusive liability to Employee under this Agreement, in contract, tort, or
otherwise, for any Involuntary Termination of the employment relationship.
Employee, to the extent permitted by law, covenants not to sue or lodge any
claim, demand or cause of action against Employer for any sums for Involuntary
Termination other than those sums specified in this Section 3.5.

         3.6.     Upon termination of the employment relationship as a result of
Employee's death, Employee's heirs, administrators, or legatees shall be
entitled to Employee's pro rata salary for the remaining term of contract.

         3.7.     Upon termination of the employment relationship as a result of
Employee's incapacity, Employee shall be entitled to his or her pro rata salary
for the remaining term of contract.

         3.8.     In all cases, the payments payable to Employee under Section
3.5 of this Agreement upon termination of the employment relationship shall be
offset against any amounts to which Employee may otherwise be entitled under any
and all severance plans, and policies of Employer, or its Affiliates.

         3.9.     Termination (including expiration of the Term) of the
employment relationship does not terminate those obligations imposed by this
Agreement, which are continuing obligations, including, without limitation,
Employee's obligations under Articles 5 and 6. Upon termination, Employee shall
promptly return all property of the Company to the Company, including books,
records, computer files, etc.

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ARTICLE 4: CONTINUATION OF EMPLOYMENT BEYOND TERM; TERMINATION AND EFFECTS OF
           TERMINATION:

         4.1.     Should Employee remain employed by Employer beyond the
expiration of the Term of this Agreement, and this Agreement has not been
extended by Employer, the Employer-Employee relationship shall be employment at
will, terminable at any time by either Employer or Employee for any reason
whatsoever, with or without cause, subject to the terms and conditions hereof.

ARTICLE 5: OWNERSHIP AND PROTECTION OF INFORMATION; COPYRIGHTS:

         5.1.     All information, ideas, concepts, improvements, discoveries,
and inventions, whether patentable or not, which are conceived, made, developed
or acquired by Employee, individually or in conjunction with others, during
Employee's employment by Employer (whether during business hours or otherwise
and whether on Employer's premises or otherwise) which relate to Employer's
business, products or services (including, without limitation, all such
information relating to corporate opportunities, research, financial and sales
data, pricing and trading terms, evaluations, opinions, interpretations,
acquisition prospects, the identity of customers or their requirements, the
identity of key contacts within the customer's organizations or within the
organization of acquisition prospects, or marketing and merchandising
techniques, prospective names, and marks) shall be disclosed to Employer and are
and shall be the sole and exclusive property of Employer. Moreover, all
drawings, memoranda, notes, records, files, correspondence, drawings, manuals,
models, specifications, computer programs, maps and all other writings or
materials of any type embodying any of such information, ideas, concepts,
improvements, discoveries, and inventions are and shall be the sole and
exclusive property of Employer.

         5.2.     Employee acknowledges that the business of Employer, and its
Affiliates is highly competitive and that its strategies, methods, books,
records, and documents, its technical information concerning its products,
equipment, services, and processes, procurement procedures and pricing
techniques, the names of and other information (such as credit and financial
data) concerning its customers and business affiliates, all comprise
confidential business information and trade secrets which are valuable, special,
and unique assets which Employer, or its Affiliates use in its business to
obtain a competitive advantage over its competitors. Employee further
acknowledges that protection of such confidential business information and trade
secrets against unauthorized disclosure and use is of critical importance to
Employer, and its Affiliates in maintaining its competitive position. Employee
acknowledges that under this Agreement, Employee is being given access to
Employer's confidential business information and trade secrets, and Employee
hereby agrees that Employee will not, at any time during or after his or her
employment by Employer, make any unauthorized disclosure of any confidential
business information or trade secrets of Employer, or its Affiliates, or make
any use thereof, except in the carrying out of his or her employment
responsibilities hereunder, or as may be required by law. EOTT Energy LLC and
its Affiliates shall be third party beneficiaries of Employee's obligations
under this Section. As a result of Employee's employment by Employer, Employee
may also from time to time have access to, or knowledge of, confidential
business information or trade secrets of third parties, such as customers,
suppliers, partners, joint venturers, and the like, of Employer, and its
Affiliates. Employee also agrees to preserve and protect the confidentiality of
such third party confidential information and trade secrets to the same extent,
and on the same basis, as Employer's confidential business information and trade
secrets. Employee acknowledges that money damages would not be a sufficient
remedy for any breach of this Article 5 by Employee, and Employer shall be
entitled to enforce the provisions of this Article 5 to specific performance and
injunctive relief as remedies for such breach or any threatened

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breach. Such remedies shall not be deemed the exclusive remedies for a breach of
this Article 5, but shall be in addition to all remedies available at law or in
equity to Employer, including the recovery of damages from Employee and his or
her agents involved in such breach.

ARTICLE 6: POST-EMPLOYMENT NON-COMPETITION OBLIGATIONS:

         6.1.     As part of the consideration for the compensation and benefits
to be paid to Employee hereunder, and as an additional incentive for Employer to
enter into this Agreement, and in particular Employer's agreement to the
protections contained in Section 3.5, Employer and Employee agree to the
non-competition provisions of this Article 6 during the term of this Agreement.
Employee agrees that during the period of Employee's non-competition obligations
hereunder, Employee will not, directly or indirectly for Employee or for others,
in any geographic area or market where Employer or any of its Affiliated
companies are conducting any business as of the date of termination of the
employment relationship or have during the previous twelve months conducted any
business:

         (i)      engage in any business competitive with the business conducted
                  by Employer or its Affiliates;

         (ii)     render advice or services to, or otherwise assist, any other
                  person, association, or entity who is engaged, directly or
                  indirectly, in any business competitive with the business
                  conducted by Employer or its Affiliates; or

         (iii)    induce any employee of Employer or any of its Affiliates to
                  terminate his or her employment with Employer or its
                  Affiliates, or hire or assist in the hiring of any such
                  employee by person, association, or entity not Affiliated with
                  Employer or its Affiliates.

These non-competition obligations shall continue for a period of one year after
involuntary termination of this employment relationship.

         6.2.     Employee understands that the foregoing restrictions may limit
his or her ability to engage in certain businesses during the twelve (12) month
period provided for above, but acknowledges that Employee will receive
sufficiently high remuneration and other benefits (e.g., the right to receive
compensation under Section 3.5 upon Involuntary Termination) under this
Agreement to justify such restriction. Employee acknowledges that money damages
would not be sufficient remedy for any breach of this Article 6 by Employee, and
Employer shall be entitled to enforce the provisions of this Article 6 by
terminating any payments then owed to Employee under this Agreement and/or to
specific performance and injunctive relief as remedies for such breach or any
threatened breach. Such remedies shall not be deemed the exclusive remedies for
a breach of this Article 6, but shall be in addition to all remedies available
at law or in equity to Employer, including, without limitation, the recovery of
damages from Employee and his or her agents involved in such breach.

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         6.3.     It is expressly understood and agreed that Employer and
Employee consider the restrictions contained in this Article 6 to be reasonable
and necessary to protect the proprietary information of Employer. Nevertheless,
if any of the aforesaid restrictions are found by a court having jurisdiction to
be unreasonable, or overly broad as to geographic area or time, or otherwise
unenforceable, the parties intend for the restrictions therein set forth to be
modified by such courts so as to be reasonable and enforceable and, as so
modified by the court, to be fully enforced.

ARTICLE 7: INDEMNIFICATION:

         7.1      If, at any time during or after the Term of this Agreement,
the Employee is made a party to, or is threatened to be made a party in, any
civil, criminal or administrative action, suit or proceeding by reason of the
fact that the Employee is or was a director, officer, employee or agent of the
Company, or of any other corporation or any partnership, joint venture, trust or
other enterprise for which the Employee served as such at the request of the
Company, then the Employee shall be indemnified by the Company, to the fullest
extent permitted under applicable law, against expenses actually and reasonably
incurred by the Employee or imposed on the Employee in connection with, or
resulting from, the defense of such action, suit or proceeding, or in connection
with, or resulting from, any appeal therein if the Employee acted in good faith
and in a manner the Employee reasonably believed to be in or not opposed to the
best interest of the Company, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe the Employee's conduct was
unlawful, except with respect to matters as to which it is adjudged that the
Employee is liable to the Company or to such other corporation, partnership,
joint venture, trust or other enterprise for gross negligence or willful
misconduct in the performance of the Employee's duties. As used herein, the term
"expenses" shall include all obligations actually and reasonably incurred by the
Employee for the payment of money, including, without limitation, attorney's
fees, judgments, awards, fines, penalties and amounts paid in satisfaction of a
judgment or in settlement of any such action, suit or proceeding, except amounts
paid to the Company or such other corporation, partnership, joint venture, trust
or other enterprise by the Employee. The foregoing indemnification provisions
shall be in addition to any other rights to indemnification to which the
Employee may be entitled.

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ARTICLE 8: MISCELLANEOUS:

         8.1.     For purposes of this Agreement the following terms shall have
the meanings ascribed to them below:

         (a)      "Affiliates" or "Affiliated" means an entity who directly, or
                  indirectly through one or more intermediaries, controls, is
                  controlled by, or is under common control with Employer.

         (b)      "Involuntary Termination Date" shall mean Employee's last date
                  of employment by reason of an Involuntary Termination.

         8.2.     For purposes of this Agreement, notices and all other
communications provided for herein shall be in writing and shall be deemed to
have been duly given when personally delivered or when mailed by United States
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:

If to Employer, to:

         EOTT Energy LLC
         Box 4666
         Houston, Texas 77210
         Attention: Vice President Human Resources

If to Employee, to:

         Mr. Thomas M. Matthews
         17402 Ridge Top Drive
         Houston, Texas 77090

Either Employer or Employee may furnish a change of address to the other in
writing in accordance herewith, except that notices of changes of address shall
be effective only upon receipt.

         8.3.     This Agreement shall be governed in all respects by the laws
of the State of Texas, excluding any conflict-of-law rule or principle that
might refer the construction of the Agreement to the laws of another state or
country.

         8.4.     No failure by either party hereto at any time to give notice
of any breach by the other party of, or to require compliance with, any
condition or provision of this Agreement shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or at any prior or subsequent
time.

         8.5.     If a dispute arises out of or related to this Agreement, other
than a dispute regarding Employee's obligations under Article 5, Section 5.2, or
Article 6, Section 6.1, and if the dispute cannot be settled through direct
discussions, then Employer and Employee agree to first endeavor to settle the
dispute in an amicable manner by mediation, before having recourse to any other
proceeding or forum. Employer shall pay all costs of such mediation and binding
arbitration, exclusive of Employee's legal fees. Thereafter, the matter shall be
submitted to binding arbitration as follows:

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         ANY DISPUTE, CLAIM, OR CONTROVERSY ARISING OUT OF OR RELATED IN ANY WAY
         TO THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO ITS ENFORCEABILITY,
         VALIDITY, OR INTERPRETATION, OR RELATED IN ANY WAY TO EMPLOYEE'S
         EMPLOYMENT WITH EMPLOYER THAT IS NOT FIRST RESOLVED BY AGREEMENT OR
         MEDIATION AS PROVIDED ABOVE, SHALL BE SUBMITTED TO AND RESOLVED BY
         BINDING ARBITRATION WITH THE AMERICAN ARBITRATION ASSOCIATION ("AAA")
         IN HOUSTON, TEXAS, IN ACCORDANCE WITH THE AAA'S APPLICABLE RULES TO THE
         RESOLUTION OF EMPLOYMENT DISPUTES. JUDGMENT UPON THE AWARD RENDERED BY
         THE ARBITRATOR(S) MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. IT
         IS SPECIFICALLY AGREED THAT THE ARBITRATION PROVISION SHALL BE BINDING
         ON EMPLOYEE'S HEIRS, ADMINISTRATORS, AND PERSONAL REPRESENTATIVES. THE
         PARAGRAPH SHALL BE GOVERNED BY THE FEDERAL ARBITRATION ACT. NOTHING
         CONTAINED IN THE AGREEMENT SHALL PREVENT EMPLOYER FROM SEEKING
         INJUNCTIVE RELIEF AGAINST EMPLOYEE FOR VIOLATION OF ANY AGREEMENT
         PERTAINING TO NON-COMPETITION, TRADE SECRETS, OR CONFIDENTIALITY.

         8.6.     It is a desire and intent of the parties that the terms,
provisions, covenants, and remedies contained in this Agreement shall be
enforceable to the fullest extent permitted by law. If any such term, provision,
covenant, or remedy of this Agreement or the application thereof to any person,
association, or entity or circumstances shall, to any extent, be construed to be
invalid or unenforceable in whole or in part, then such term, provision,
covenant, or remedy shall be construed in a manner so as to permit its
enforceability under the applicable law to the fullest extent permitted by law.
In any case, the remaining provisions of this Agreement or the application
thereof to any person, association, or entity or circumstances other than those
to which they have been held invalid or unenforceable, shall remain in full
force and effect.

         8.7.     This Agreement shall be binding upon and inure to the benefit
of Employer and any other person, association, or entity which may hereafter
acquire or succeed to all or substantially all of the business or assets of
Employer by any means whether direct or indirect, by purchase, merger,
consolidation, or otherwise. Employer may assign this Agreement to any Affiliate
or any other entity of EOTT Energy LLC. Employee's rights and obligations under
this Agreement hereof are personal and such rights, benefits, and obligations of
Employee shall not be voluntarily or involuntarily assigned, alienated, or
transferred, whether by operation of law or otherwise, without the prior written
consent of Employer.

         8.8.     There exist other agreements between Employer and Employee
relating to the employment relationship between them, e.g., the agreement with
respect to Employer policies contained in Employer's Code of Ethics policy and
agreements with respect to benefit plans. This Agreement replaces and merges
previous agreements and discussions pertaining to the following subject matters
covered herein: the nature of Employee's employment relationship with Employer
and the term and termination of such relationship. This Agreement constitutes
the entire agreement of the parties with regard to such subject matters, and
contains all of the covenants, promises, representations, warranties, and
agreements between the parties with respect such subject matters. Each party to
this Agreement acknowledges that no representation, inducement, promise, or
agreement, oral or written, has been made by either party with respect to such
subject matters, which is not embodied herein, and that no agreement, statement,
or promise relating to the employment of Employee by Employer that is not
contained in this Agreement shall be valid or binding. Any modification of this
Agreement will be effective only if it is in writing and

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signed by each party whose rights hereunder are affected thereby, provided that
any such modification must be authorized or approved by the Board of Directors
of Employer.

         IN WITNESS WHEREOF, Employer and Employee have duly executed this
Agreement in multiple originals to be effective on the date first stated above.

                                    EOTT ENERGY LLC

                                    By: /s/ Mary Ellen Coombe
                                        ----------------------------------------
                                        Name: Mary Ellen Coombe
                                        Title: Vice President, HR

                                    This 14th day of July, 2003

                                    THOMAS M. MATTHEWS

                                    /s/ Thomas M. Matthews
                                    -----------------------------------

                                    This 14 day of July, 2003

                                  - Page 12 -

<PAGE>

                                 EXHIBIT "A" TO
                         EXECUTIVE EMPLOYMENT AGREEMENT
                                     BETWEEN
                     EOTT ENERGY LLC AND THOMAS M. MATTHEWS

Employee Name:             Thomas M. Matthews

Term:                      Three (3) years (June 30, 2006)

Position:                  Chairman of the Board and Chief Executive Officer

Reporting Relationship:    Board of Directors

Location:                  Houston, Texas

Monthly Base Salary:       Employee's monthly base salary shall not be less than
                           thirty thousand dollars ($30,000.00).

Bonus:                     Employee is eligible to participate in the EOTT
                           Energy LLC Annual Incentive Plan ("Plan") or any
                           appropriate replacement bonus plan of Employer. All
                           bonuses are discretionary and shall be paid in
                           accordance with the terms and provisions of the Plan.
                           The annual targeted incentive is fifty percent (50%)
                           of the annual base salary.

Long Term Incentives:      Employee is eligible to participate in any long term
                           incentive plans as recommended and approved by the
                           Board of Directors of EOTT Energy LLC. Employee's
                           2003 award under the EOTT Energy LLC Equity Plan is
                           140,000 LLC units. In the event of Involuntary
                           Termination as a result of Change of Control as
                           defined in Article 3, Section 3.5(ii), accelerated
                           vesting shall occur on the termination date for all
                           unvested units under any award grants.

Vacation Benefits:         Employee shall receive five (5) weeks of vacation per
                           year accrued on a monthly basis.

Permitted Activities:      Authorized to accept and participate on no more than
                           three Board of Director assignments provided that
                           there are no conflicts of interest as determined by
                           the EOTT Energy Audit Committee.

EOTT ENERGY LLC                               THOMAS M. MATTHEWS

By:  /s/ Mary Ellen Coombe                    /s/ T.M. Matthews
     -----------------------------------      ----------------------------------
     Name: Mary Ellen Coombe                  This 14 day of July, 2003
     Title: Vice President, HR
     This 14 day of July, 2003

                                   - Page 13 -<PAGE>
                                                                    EXHIBIT 10.3

                         EXECUTIVE EMPLOYMENT AGREEMENT

         This Employment Agreement ("Agreement"), including the attached Exhibit
"A", is entered into between EOTT ENERGY LLC, a Delaware corporation, having
offices at 2000 W. Sam Houston Parkway S., Suite 400, Houston, Texas 77042
("Employer" and "Company"), and H. KEITH KAELBER, an individual currently
residing at 3195 Inwood Drive, Houston, Texas 77019 ("Employee"), to be
effective as of July 1, 2003 (the "Effective Date").

                                   WITNESSETH:

         WHEREAS, Employer is desirous of employing Employee pursuant to the
terms and conditions and for the consideration set forth in this Agreement, and
Employee is desirous of entering employment with the Employer pursuant to such
terms and conditions and for such consideration.

         NOW, THEREFORE, for and in consideration of the mutual promises,
covenants, and obligations contained herein, Employer and Employee agree as
follows:

ARTICLE 1: EMPLOYMENT AND DUTIES:

         1.1.     Employer agrees to employ Employee, and Employee agrees to be
employed by Employer, beginning as of the Effective Date of this Agreement and
continuing until the date set forth on Exhibit "A" (the "Term"), subject to the
terms and conditions of this Agreement. This Agreement will expire by its own
terms and the Employee will automatically become an employee at will and be
included in all general employment and benefit arrangements at the end of the
Term unless the Company notifies Employee of its intention to extend the Term
(such notice to include the length of the intended extension) at least sixty
(60) days prior to the expiration of the Term and Employee accepts such
extension within ten (10) days of receipt of such notice.

         1.2.     Employee shall be employed in the position set forth on
Exhibit "A". Employee agrees to serve in the assigned position and to perform
diligently and to the best of Employee's abilities the duties and services
appertaining to such position as determined by Employer, as well as such
additional or different duties and services appropriate to such position which
Employee from time to time may be reasonably directed to perform by Employer.
Employee shall at all times comply with and be subject to such policies and
procedures as Employer may establish from time to time.

         1.3.     Employee shall, during the period of Employee's employment by
Employer, devote Employee's full business time, energy, and best efforts to the
business and affairs of Employer. Employee may not engage, directly or
indirectly, in any other business, investment, or activity that interferes with
Employee's performance of Employee's duties hereunder, is contrary to the
interests of Employer, or requires any significant portion of Employee's
business time. The activities described as "permitted activities," on Exhibit A
attached hereto shall not be deemed a violation of this Section 1.3.

                                   - Page 1 -

<PAGE>

         1.4.     Employee acknowledges and agrees that Employee owes a
fiduciary duty of loyalty, fidelity and allegiance to act at all times in the
best interests of the Employer and to do no act which would injure Employer's
business, its interests, or its reputation. Employee agrees to comply with the
policies and procedures as described and contained in the Employer's Code of
Ethics policy, a copy of which has been provided to Employee.

ARTICLE 2: COMPENSATION AND BENEFITS:

         2.1.     Employee shall be paid as set forth on Exhibit "A". Employee's
monthly base salary shall be paid in semimonthly installments in accordance with
Employer's standard payroll practice, and (as with all other payments made to
Employee by Employer) is subject to withholding of all federal, state, city, or
other taxes as may be required by law.

         2.2.     While employed by Employer (both during the Term and
thereafter), Employee shall be allowed to participate, on the same basis
generally as other employees of Employer, in all general employee benefit plans
and programs, including improvements or modifications of the same, which on the
effective date or thereafter are made available by Employer to all or
substantially all of Employer's employees. Such benefits, plans, and programs
may include, without limitation, medical, dental care, life insurance,
disability protection, and qualified plans. Nothing in this Agreement is to be
construed or interpreted to provide greater rights, participation, coverage, or
benefits under such benefit plans or programs than provided to similarly
situated employees pursuant to the terms and conditions of such benefit plans
and programs, except as may be approved by Employer's compensation committee and
Board of Directors.

         2.3.     Employee shall be eligible to participate in the Employer's
long-term incentive plans and Employer's annual incentive plan currently
maintained or hereafter maintained by Employer for its officers as a group.

         2.4.     Employer shall not by reason of this Article 2 be obligated to
institute, maintain, or refrain from changing, amending, or discontinuing, any
such incentive compensation or employee benefit program or plan, so long as such
actions or inactions are similarly applicable to covered employees generally.
Moreover, unless specifically provided for in a written plan document adopted by
the Board of Directors of Employer, none of the benefits or arrangements
described in this Article 2 shall be secured or funded in any way, and each
shall instead constitute an unfunded and unsecured promise to pay money in the
future exclusively from the general assets of Employer.

         2.5.     Employer may withhold from any compensation, benefits, or
amounts payable under this Agreement all federal, state, city, or other taxes as
may be required by law.

                                   - Page 2 -

<PAGE>

ARTICLE 3: TERMINATION PRIOR TO EXPIRATION OF TERM AND EFFECTS OF SUCH
           TERMINATION:

         3.1.     Notwithstanding any other provisions of this Agreement,
Employer shall have the right to terminate Employee's employment under this
Agreement at any time prior to the expiration of the Term for any of the
following reasons:

         (i)      For "cause" upon the determination by the Company's Chief
                  Executive Officer and the Employer's Independent Directors of
                  the Board who are neither employees of nor Affiliated with
                  Employer or any subsidiary of Employer apart from his or her
                  capacity as a member of the Board and any Board committee and
                  who otherwise have no interest in such determination
                  ("Independent Directors") that "cause" exists for the
                  termination of the employment relationship. As used in this
                  Section 3.1(i), the term "cause" shall mean [a] Employee's
                  gross negligence or willful misconduct in the performance of
                  the duties and services required of Employee pursuant to this
                  Agreement; or [b] Employee's final conviction of a felony or
                  of a misdemeanor involving moral turpitude; [c] Employee's
                  involvement in a conflict of interest as referenced in
                  Sections 1.3 and 1.4 with respect to which Employer makes a
                  good faith determination to terminate the employment of
                  Employee; or [d] Employee's material breach of any material
                  provision of this Agreement which remains uncorrected for
                  thirty (30) days following written notice to Employee by
                  Employer of such breach. It is expressly acknowledged and
                  agreed that the decision as to whether "cause" exists for
                  termination of the employment relationship by Employer is
                  delegated to the Independent Directors of the Board of
                  Employer for determination;

         (ii)     for any other reason whatsoever, with or without cause, in the
                  sole discretion of the Employer's Independent Directors of the
                  Board;

         (iii)    upon Employee's death; or

         (iv)     to the extent allowed by law, upon Employee's becoming
                  incapacitated by accident, sickness, or other circumstance
                  which renders him or her mentally or physically incapable of
                  performing the duties and services required of Employee, as
                  determined in good faith by Employer.

The termination of Employee's employment by Employer prior to the expiration of
the Term shall constitute a "Termination for Cause" if made pursuant to Section
3.1(i); the effect of such termination is specified in Section 3.4. The
termination of Employee's employment by Employer prior to the expiration of the
Term shall constitute an "Involuntary Termination" if made pursuant to Section
3.1(ii); the effect of such termination is specified in Section 3.5. The effect
of the employment relationship being terminated pursuant to Section 3.1(iii) as
a result of Employee's death is specified in Section 3.6. The effect of the
employment relationship being terminated

                                   - Page 3 -

<PAGE>

pursuant to Section 3.1(iv) as a result of the Employee becoming incapacitated
is specified in Section 3.7.

         3.2.     Notwithstanding any other provisions of this Agreement except
Section 8.5, Employee shall have the right to terminate the employment
relationship under this Agreement at any time prior to the expiration of the
Term of employment for any of the following reasons:

         (i)      a material breach by Employer of any material provision of
                  this Agreement or the occurrence of an Involuntary Termination
                  as defined in Section 3.5 which remains uncorrected for 30
                  days following written notice of such breach by Employee to
                  Employer; or

         (ii)     for any other reason whatsoever, in the sole discretion of
                  Employee.

The termination of Employee's employment by Employee prior to the expiration of
the Term shall constitute an "Involuntary Termination" if made pursuant to
Section 3.2(i); the effect of such termination is specified in Section 3.5. The
termination of Employee's employment by Employee prior to the expiration of the
Term shall constitute a "Voluntary Termination" if made pursuant to Section
3.2(ii); the effect of such termination is specified in Section 3.3.

         3.3.     Upon a "Voluntary Termination" of the employment relationship
by Employee prior to expiration of the Term, all future compensation to which
Employee is entitled and all future benefits for which Employee is eligible
shall cease and terminate as of the date of termination. Employee shall be
entitled to pro rata salary and accrued benefits through the date of such
termination, but Employee shall not be entitled to any bonuses or incentive
compensation not yet paid at the date of such termination.

         3.4.     If Employee's employment hereunder shall be terminated by
Employer for Cause prior to expiration of the Term, all future compensation to
which Employee is entitled and all future benefits for which Employee is
eligible shall cease and terminate as of the date of termination. Employee shall
be entitled to pro rata salary and accrued benefits through the date of such
termination, but Employee shall not be entitled to any bonuses or incentive
compensation not yet paid at the date of such termination.

         3.5.     Upon an Involuntary Termination of the employment relationship
by either Employer or Employee prior to expiration of the Term, Employee shall
be entitled, after execution of a Waiver and Release Agreement in consideration
of Employee's continuing obligations hereunder after such termination
(including, without limitation, Employee's non-competition obligations), to the
sum of two years annual base salary payable as follows: one year's annual base
salary shall be paid within thirty (30) days of the termination date; the
remaining one year's annual base salary shall be paid at the end of the twelve
(12) month period following the termination date. As used in this Agreement,
"Involuntary Termination" shall also mean termination of Employee's employment
with Employer if such termination results from:

         (i)      termination by Employee within 90 days of and in connection
                  with or based upon any of the following:

                                   - Page 4 -

<PAGE>

                  (a)      a substantial and/or material reduction in the nature
                           or scope of Employee's duties and/or responsibilities
                           as such duties are constituted as of the effective
                           date of this Agreement or later agreed to by Employee
                           and Employer, or if Employee is no longer an
                           executive officer of the Company as defined as
                           Section 16b in SEC regulations, which reduction
                           remains in place and uncorrected for thirty(30) days
                           following written notice of such breach to Employer
                           by Employee;

                  (b)      a reduction in Employee's base pay or an exclusion
                           from a benefit plan or programs (except as part of a
                           general cutback for all employees or officers);

                  (c)      a change in the location for the primary performance
                           of Employee's services under this Agreement from the
                           city in which Employee was serving at the time of
                           notification to a city which is more than 100 miles
                           away from such location, which change is not approved
                           by Employee;

         (ii)     termination by Employee within one (1) year of Change of
                  Control Date:

                  (a)      "Change of Control" of Company shall mean

                           (i)      Company merges or consolidates with any
                                    other entity (other than one of EOTT Energy
                                    LLC's majority owned subsidiaries) and the
                                    shareholders of EOTT Energy LLC own less
                                    than 50% of the surviving entity,

                           (ii)     Company sells all or substantially all of
                                    its assets to any other person or entity
                                    (other than (i) a sale of equity interests
                                    in EOTT Energy LLC or (ii) a sale of assets
                                    to another majority owned subsidiary of EOTT
                                    Energy LLC and in connection therewith
                                    Employee becomes employed by such
                                    subsidiary, EOTT Energy LLC or a partnership
                                    in which EOTT Energy LLC is the general
                                    partner),

                           (iii)    Company is dissolved,

                           (iv)     any third person or entity together with its
                                    Affiliates shall become, directly or
                                    indirectly, the Beneficial Owner of greater
                                    than 50% of the voting stock of Company
                                    (except as the result of a distribution of
                                    the voting securities of the Company to the
                                    shareholders), or if

                           (v)      during such time as Company has a class of
                                    Voting Securities registered under the
                                    Securities Exchange Act of 1934, the
                                    individuals who constituted the members of
                                    the Company's Board of Directors ("Incumbent
                                    Board") upon the effective date of such
                                    registration cease for any reason to
                                    constitute at least a majority thereof,
                                    provided that any person becoming a director
                                    whose election or nomination for election by
                                    Company stockholders was approved by a vote
                                    of at least two thirds (2/3) of the
                                    directors comprising the Incumbent Board
                                    (either by a specific vote or by approval of
                                    the proxy statement of the Company in which
                                    such person is named as a nominee for
                                    director, without objection to such
                                    nomination) shall be, for purposes of this

                                   - Page 5 -

<PAGE>

                                    clause (v), considered as though such person
                                    were a member of the Incumbent Board.

                  (b)      "Change of Control Date" shall mean the day on which
                           a Change of Control becomes effective.

Employee shall not be under any duty or obligation to seek or accept other
employment following Involuntary Termination and the amounts due Employee
hereunder shall not be reduced or suspended if Employee accepts subsequent
employment. Employee's rights under this Section 3.5 are Employee's sole and
exclusive rights against Employer, or its Affiliates, and Employer's sole and
exclusive liability to Employee under this Agreement, in contract, tort, or
otherwise, for any Involuntary Termination of the employment relationship.
Employee, to the extent permitted by law, covenants not to sue or lodge any
claim, demand or cause of action against Employer for any sums for Involuntary
Termination other than those sums specified in this Section 3.5.

         3.6.     Upon termination of the employment relationship as a result of
Employee's death, Employee's heirs, administrators, or legatees shall be
entitled to Employee's pro rata salary for the remaining term of contract.

         3.7.     Upon termination of the employment relationship as a result of
Employee's incapacity, Employee shall be entitled to his or her pro rata salary
for the remaining term of contract.

         3.8.     In all cases, the payments payable to Employee under Section
3.5 of this Agreement upon termination of the employment relationship shall be
offset against any amounts to which Employee may otherwise be entitled under any
and all severance plans, and policies of Employer, or its Affiliates.

         3.9.     Termination (including expiration of the Term) of the
employment relationship does not terminate those obligations imposed by this
Agreement, which are continuing obligations, including, without limitation,
Employee's obligations under Articles 5 and 6. Upon termination, Employee shall
promptly return all property of the Company to the Company, including books,
records, computer files, etc.

                                   - Page 6 -

<PAGE>

ARTICLE 4: CONTINUATION OF EMPLOYMENT BEYOND TERM; TERMINATION AND EFFECTS OF
           TERMINATION:

         4.1.     Should Employee remain employed by Employer beyond the
expiration of the Term of this Agreement, and this Agreement has not been
extended by Employer, the Employer-Employee relationship shall be employment at
will, terminable at any time by either Employer or Employee for any reason
whatsoever, with or without cause, subject to the terms and conditions hereof.

ARTICLE 5: OWNERSHIP AND PROTECTION OF INFORMATION; COPYRIGHTS:

         5.1.     All information, ideas, concepts, improvements, discoveries,
and inventions, whether patentable or not, which are conceived, made, developed
or acquired by Employee, individually or in conjunction with others, during
Employee's employment by Employer (whether during business hours or otherwise
and whether on Employer's premises or otherwise) which relate to Employer's
business, products or services (including, without limitation, all such
information relating to corporate opportunities, research, financial and sales
data, pricing and trading terms, evaluations, opinions, interpretations,
acquisition prospects, the identity of customers or their requirements, the
identity of key contacts within the customer's organizations or within the
organization of acquisition prospects, or marketing and merchandising
techniques, prospective names, and marks) shall be disclosed to Employer and are
and shall be the sole and exclusive property of Employer. Moreover, all
drawings, memoranda, notes, records, files, correspondence, drawings, manuals,
models, specifications, computer programs, maps and all other writings or
materials of any type embodying any of such information, ideas, concepts,
improvements, discoveries, and inventions are and shall be the sole and
exclusive property of Employer.

         5.2.     Employee acknowledges that the business of Employer, and its
Affiliates is highly competitive and that its strategies, methods, books,
records, and documents, its technical information concerning its products,
equipment, services, and processes, procurement procedures and pricing
techniques, the names of and other information (such as credit and financial
data) concerning its customers and business affiliates, all comprise
confidential business information and trade secrets which are valuable, special,
and unique assets which Employer, or its Affiliates use in its business to
obtain a competitive advantage over its competitors. Employee further
acknowledges that protection of such confidential business information and trade
secrets against unauthorized disclosure and use is of critical importance to
Employer, and its Affiliates in maintaining its competitive position. Employee
acknowledges that under this Agreement, Employee is being given access to
Employer's confidential business information and trade secrets, and Employee
hereby agrees that Employee will not, at any time during or after his or her
employment by Employer, make any unauthorized disclosure of any confidential
business information or trade secrets of Employer, or its Affiliates, or make
any use thereof, except in the carrying out of his or her employment
responsibilities hereunder, or as may be required by law. EOTT Energy LLC and
its Affiliates shall be third party beneficiaries of Employee's obligations
under this Section. As a result of Employee's employment by Employer, Employee
may also from time to time have access to, or knowledge of, confidential
business information or trade secrets of third parties, such as customers,
suppliers, partners, joint venturers, and the like, of Employer, and its
Affiliates. Employee also agrees to preserve and protect the confidentiality of
such third party confidential information and trade secrets to the same extent,
and on the same basis, as Employer's confidential business

                                   - Page 7 -

<PAGE>

information and trade secrets. Employee acknowledges that money damages would
not be a sufficient remedy for any breach of this Article 5 by Employee, and
Employer shall be entitled to enforce the provisions of this Article 5 to
specific performance and injunctive relief as remedies for such breach or any
threatened breach. Such remedies shall not be deemed the exclusive remedies for
a breach of this Article 5, but shall be in addition to all remedies available
at law or in equity to Employer, including the recovery of damages from Employee
and his or her agents involved in such breach.

ARTICLE 6: POST-EMPLOYMENT NON-COMPETITION OBLIGATIONS:

         6.1.     As part of the consideration for the compensation and benefits
to be paid to Employee hereunder, and as an additional incentive for Employer to
enter into this Agreement, and in particular Employer's agreement to the
protections contained in Section 3.5, Employer and Employee agree to the
non-competition provisions of this Article 6 during the term of this Agreement.
Employee agrees that during the period of Employee's non-competition obligations
hereunder, Employee will not, directly or indirectly for Employee or for others,
in any geographic area or market where Employer or any of its Affiliated
companies are conducting any business as of the date of termination of the
employment relationship or have during the previous twelve months conducted any
business:

         (i)      engage in any business competitive with the business conducted
                  by Employer or its Affiliates;

         (ii)     render advice or services to, or otherwise assist, any other
                  person, association, or entity who is engaged, directly or
                  indirectly, in any business competitive with the business
                  conducted by Employer or its Affiliates; or

         (iii)    induce any employee of Employer or any of its Affiliates to
                  terminate his or her employment with Employer or its
                  Affiliates, or hire or assist in the hiring of any such
                  employee by person, association, or entity not Affiliated with
                  Employer or its Affiliates.

These non-competition obligations shall continue for a period of one year after
involuntary termination of this employment relationship.

         6.2.     Employee understands that the foregoing restrictions may limit
his or her ability to engage in certain businesses during the twelve (12) month
period provided for above, but acknowledges that Employee will receive
sufficiently high remuneration and other benefits (e.g., the right to receive
compensation under Section 3.5 upon Involuntary Termination) under this
Agreement to justify such restriction. Employee acknowledges that money damages
would not be sufficient remedy for any breach of this Article 6 by Employee, and
Employer shall be entitled to enforce the provisions of this Article 6 by
terminating any payments then owed to Employee under this Agreement and/or to
specific performance and injunctive relief as remedies for such breach or any
threatened breach. Such remedies shall not be deemed the exclusive remedies for
a breach of this Article 6, but shall be in addition to all remedies available
at law or in equity to Employer,

                                   - Page 8 -

<PAGE>

including, without limitation, the recovery of damages from Employee and his or
her agents involved in such breach.

         6.3.     It is expressly understood and agreed that Employer and
Employee consider the restrictions contained in this Article 6 to be reasonable
and necessary to protect the proprietary information of Employer. Nevertheless,
if any of the aforesaid restrictions are found by a court having jurisdiction to
be unreasonable, or overly broad as to geographic area or time, or otherwise
unenforceable, the parties intend for the restrictions therein set forth to be
modified by such courts so as to be reasonable and enforceable and, as so
modified by the court, to be fully enforced.

ARTICLE 7: INDEMNIFICATION:

         7.1      If, at any time during or after the Term of this Agreement,
the Employee is made a party to, or is threatened to be made a party in, any
civil, criminal or administrative action, suit or proceeding by reason of the
fact that the Employee is or was a director, officer, employee or agent of the
Company, or of any other corporation or any partnership, joint venture, trust or
other enterprise for which the Employee served as such at the request of the
Company, then the Employee shall be indemnified by the Company, to the fullest
extent permitted under applicable law, against expenses actually and reasonably
incurred by the Employee or imposed on the Employee in connection with, or
resulting from, the defense of such action, suit or proceeding, or in connection
with, or resulting from, any appeal therein if the Employee acted in good faith
and in a manner the Employee reasonably believed to be in or not opposed to the
best interest of the Company, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe the Employee's conduct was
unlawful, except with respect to matters as to which it is adjudged that the
Employee is liable to the Company or to such other corporation, partnership,
joint venture, trust or other enterprise for gross negligence or willful
misconduct in the performance of the Employee's duties. As used herein, the term
"expenses" shall include all obligations actually and reasonably incurred by the
Employee for the payment of money, including, without limitation, attorney's
fees, judgments, awards, fines, penalties and amounts paid in satisfaction of a
judgment or in settlement of any such action, suit or proceeding, except amounts
paid to the Company or such other corporation, partnership, joint venture, trust
or other enterprise by the Employee. The foregoing indemnification provisions
shall be in addition to any other rights to indemnification to which the
Employee may be entitled.

                                   - Page 9 -

<PAGE>

ARTICLE 8: MISCELLANEOUS:

         8.1.     For purposes of this Agreement the following terms shall have
the meanings ascribed to them below:

         (a)      "Affiliates" or "Affiliated" means an entity who directly, or
                  indirectly through one or more intermediaries, controls, is
                  controlled by, or is under common control with Employer.

         (b)      "Involuntary Termination Date" shall mean Employee's last date
                  of employment by reason of an Involuntary Termination.

         8.2.     For purposes of this Agreement, notices and all other
communications provided for herein shall be in writing and shall be deemed to
have been duly given when personally delivered or when mailed by United States
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:

If to Employer, to:

         EOTT Energy LLC
         Box 4666
         Houston, Texas 77210
         Attention: Vice President Human Resources

If to Employee, to:

         Mr. H. Keith Kaelber
         3195 Inwood Drive
         Houston, TX 77019

Either Employer or Employee may furnish a change of address to the other in
writing in accordance herewith, except that notices of changes of address shall
be effective only upon receipt.

         8.3.     This Agreement shall be governed in all respects by the laws
of the State of Texas, excluding any conflict-of-law rule or principle that
might refer the construction of the Agreement to the laws of another state or
country.

         8.4.     No failure by either party hereto at any time to give notice
of any breach by the other party of, or to require compliance with, any
condition or provision of this Agreement shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or at any prior or subsequent
time.

         8.5.     If a dispute arises out of or related to this Agreement, other
than a dispute regarding Employee's obligations under Article 5, Section 5.2, or
Article 6, Section 6.1, and if the dispute cannot be settled through direct
discussions, then Employer and Employee agree to first endeavor to settle the
dispute in an amicable manner by mediation, before having recourse to any other
pro-

                                  - Page 10 -

<PAGE>

ceeding or forum. Employer shall pay all costs of such mediation and binding
arbitration, exclusive of Employee's legal fees. Thereafter, the matter shall be
submitted to binding arbitration as follows:

         ANY DISPUTE, CLAIM, OR CONTROVERSY ARISING OUT OF OR RELATED IN ANY WAY
         TO THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO ITS ENFORCEABILITY,
         VALIDITY, OR INTERPRETATION, OR RELATED IN ANY WAY TO EMPLOYEE'S
         EMPLOYMENT WITH EMPLOYER THAT IS NOT FIRST RESOLVED BY AGREEMENT OR
         MEDIATION AS PROVIDED ABOVE, SHALL BE SUBMITTED TO AND RESOLVED BY
         BINDING ARBITRATION WITH THE AMERICAN ARBITRATION ASSOCIATION ("AAA")
         IN HOUSTON, TEXAS, IN ACCORDANCE WITH THE AAA'S APPLICABLE RULES TO THE
         RESOLUTION OF EMPLOYMENT DISPUTES. JUDGMENT UPON THE AWARD RENDERED BY
         THE ARBITRATOR(S) MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. IT
         IS SPECIFICALLY AGREED THAT THE ARBITRATION PROVISION SHALL BE BINDING
         ON EMPLOYEE'S HEIRS, ADMINISTRATORS, AND PERSONAL REPRESENTATIVES. THE
         PARAGRAPH SHALL BE GOVERNED BY THE FEDERAL ARBITRATION ACT. NOTHING
         CONTAINED IN THE AGREEMENT SHALL PREVENT EMPLOYER FROM SEEKING
         INJUNCTIVE RELIEF AGAINST EMPLOYEE FOR VIOLATION OF ANY AGREEMENT
         PERTAINING TO NON-COMPETITION, TRADE SECRETS, OR CONFIDENTIALITY.

         8.6.     It is a desire and intent of the parties that the terms,
provisions, covenants, and remedies contained in this Agreement shall be
enforceable to the fullest extent permitted by law. If any such term, provision,
covenant, or remedy of this Agreement or the application thereof to any person,
association, or entity or circumstances shall, to any extent, be construed to be
invalid or unenforceable in whole or in part, then such term, provision,
covenant, or remedy shall be construed in a manner so as to permit its
enforceability under the applicable law to the fullest extent permitted by law.
In any case, the remaining provisions of this Agreement or the application
thereof to any person, association, or entity or circumstances other than those
to which they have been held invalid or unenforceable, shall remain in full
force and effect.

         8.7.     This Agreement shall be binding upon and inure to the benefit
of Employer and any other person, association, or entity which may hereafter
acquire or succeed to all or substantially all of the business or assets of
Employer by any means whether direct or indirect, by purchase, merger,
consolidation, or otherwise. Employer may assign this Agreement to any Affiliate
or any other entity of EOTT Energy LLC. Employee's rights and obligations under
this Agreement hereof are personal and such rights, benefits, and obligations of
Employee shall not be voluntarily or involuntarily assigned, alienated, or
transferred, whether by operation of law or otherwise, without the prior written
consent of Employer.

         8.8.     There exist other agreements between Employer and Employee
relating to the employment relationship between them, e.g., the agreement with
respect to Employer policies contained in Employer's Code of Ethics policy and
agreements with respect to benefit plans. This Agreement replaces and merges
previous agreements and discussions pertaining to the following subject matters
covered herein: the nature of Employee's employment relationship with Employer
and the term and termination of such relationship. This Agreement constitutes
the entire agreement of the parties with regard to such subject matters, and
contains all of the covenants, promises, repre-

                                  - Page 11 -

<PAGE>

sentations, warranties, and agreements between the parties with respect such
subject matters. Each party to this Agreement acknowledges that no
representation, inducement, promise, or agreement, oral or written, has been
made by either party with respect to such subject matters, which is not embodied
herein, and that no agreement, statement, or promise relating to the employment
of Employee by Employer that is not contained in this Agreement shall be valid
or binding. Any modification of this Agreement will be effective only if it is
in writing and signed by each party whose rights hereunder are affected thereby,
provided that any such modification must be authorized or approved by the Board
of Directors of Employer.

         IN WITNESS WHEREOF, Employer and Employee have duly executed this
Agreement in multiple originals to be effective on the date first stated above.

                                     EOTT ENERGY LLC

                                     EOTT ENERGY LLC

                                     By: /s/ T.M. Matthews
                                         --------------------------------------
                                         Name: Thomas M. Matthews
                                         Title: Chairman and CEO

                                     This 15th day of July, 2003

                                     H. KEITH KAELBER

                                     /s/ H. Keith Kaelber
                                     ------------------------------------------
                                     Name: ____________________________________

                                     This 15th day of July, 2003

                                  - Page 12 -

<PAGE>

                                 EXHIBIT "A" TO
                         EXECUTIVE EMPLOYMENT AGREEMENT
                                     BETWEEN
                      EOTT ENERGY LLC AND H. KEITH KAELBER

Employee Name:             H. Keith Kaelber

Term:                      Three (3) years (June 30, 2006)

Position:                  Executive Vice President and Chief Financial Officer

Reporting Relationship:    Chief Executive Officer

Location:                  Houston, Texas

Monthly Base Salary:       Employee's  monthly base salary shall not be less
                           than twenty thousand  dollars ($20,000.00).

Bonus:                     Employee is eligible to participate in the
                           EOTT Energy LLC Annual Incentive Plan
                           ("Plan") or any appropriate replacement
                           bonus plan of Employer. All bonuses are
                           discretionary and shall be paid in
                           accordance with the terms and provisions of
                           the Plan. The annual targeted incentive is
                           fifty percent (50%) of the annual base
                           salary.

Long Term Incentives:      Employee  is  eligible  to  participate  in any long
                           term incentive plans as recommended and approved by
                           the Board of Directors of EOTT Energy LLC. Employee's
                           2003 award under the EOTT Energy LLC Equity Plan is
                           75,000 LLC units. In the event of Involuntary
                           Termination as a result of Change of Control as
                           defined in Article 3, Section 3.5(ii), accelerated
                           vesting shall occur on the termination date for all
                           unvested units under any award grants.

Vacation Benefits:         Employee shall receive four (4) weeks of vacation per
                           year accrued on a monthly basis.

Permitted Activities:      Director, Indwell
                           Boy Scouts of America

EOTT ENERGY LLC                                H. KEITH KAELBER

By: /s/ T.M. Matthews                          /s/ H. Keith Kaelber
    ------------------------------------       ---------------------------------
     Name: T.M. Matthews                       This 15th day of July, 2003
     Title: Chairman & CEO
     This 15 day of July, 2003

                                  - Page 13 -

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