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<ITEMS>7
<FILING-DATE>20021119
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>MARTIN MIDSTREAM PARTNERS LP
<CIK>0001176334
<ASSIGNED-SIC>5171
<IRS-NUMBER>050527861
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1231
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<FILE-NUMBER>000-50056
<FILM-NUMBER>02833339
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<BUSINESS-ADDRESS>
<STREET1>4200 STONE ROAD
<CITY>KILGORE
<STATE>TX
<ZIP>75662
<PHONE>9039836200
</BUSINESS-ADDRESS>
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<DESCRIPTION>FORM 8-K
<TEXT>
<PAGE>
--------------------------------------------------------------------------------


                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549





                                    FORM 8-K

                                 CURRENT REPORT

     PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934




       Date of report (date of earliest event reported): November 6, 2002




                         MARTIN MIDSTREAM PARTNERS L.P.
             (Exact name of Registrant as specified in its charter)


<Table>
<S>                               <C>                            <C>
         DELAWARE                        000-50056                            05-0527861
  (State of incorporation         (Commission file number)       (I.R.S. employer identification number)
     or organization)

                             4200 STONE ROAD
                              KILGORE, TEXAS                                                  75662
                 (Address of principal executive offices)                                  (Zip code)
</Table>



       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (903) 983-6200


--------------------------------------------------------------------------------
<PAGE>
ITEM 5. OTHER EVENTS.

         On November 6, 2002, Martin Midstream Partners L.P., a Delaware limited
partnership (the "Partnership"), completed the sale by the Partnership of
2,900,000 common units representing limited partner interests in the Partnership
(the "Units") in an underwritten public offering (the "Offering"). The Units
sold in the Offering were registered under the Securities Act of 1933, as
amended, pursuant to the Partnership's registration statement (the "Registration
Statement") on Form S-1 (File No. 333-91706). In connection with the
consummation of the Offering, the Partnership entered into each of the
agreements attached as Exhibits to this Current Report on Form 8-K, which had
previously been filed as non-executed forms to the Registration Statement. This
Current Report on Form 8-K is being filed solely for the purpose of filing
execution copies of such form agreements.

ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.

         (c)      EXHIBITS


         EXHIBIT
         NUMBER                        DESCRIPTION
         -------                       -----------
         1.1        --   Underwriting Agreement dated October 31, 2002, by and
                         among Martin Resource Management Corporation ("MRMC"),
                         Martin Resource LLC ("Resource LLC"), Martin Midstream
                         GP LLC (the "General Partner"), Martin Midstream
                         Partners L.P. (the "Partnership"), Martin Operating
                         Partnership L.P. (the "Operating Partnership"), Martin
                         Operating GP LLC (the "Operating General Partner"),
                         Martin Gas Marine LLC ("MGMLLC"), Martin Gas Sales LLC
                         ("MGSLLC"), Martin L.P. Gas, Inc. ("MLP Gas"), CF
                         Martin Sulphur Holding Corporation ("CFMSHC") and the
                         underwriters named therein.

         3.1        --   First Amended and Restated Agreement of Limited
                         Partnership of Martin Midstream Partners L.P., dated
                         November 6, 2002.

         3.2        --   Amended and Restated Agreement of Limited Partnership
                         of Martin Operating Partnership L.P., dated November 6,
                         2002.

         10.1       --   Credit Agreement dated November 6, 2002, among the
                         Operating Partnership, as borrower, the Partnership,
                         Royal Bank of Canada, as administrative agent and
                         collateral agent, Comerica Bank-Texas, as co-agent, and
                         the lenders named therein.

         10.2       --   Contribution, Conveyance and Assumption Agreement dated
                         October 31, 2002, by and among MRMC, Resource LLC, the
                         General Partner, the Partnership, the Operating
                         Partnership, the Operating General Partner, MGMLLC,
                         Martin Resources, Inc., MLP Gas, MGSLLC, Martin
                         Transport, Inc. ("Transport"), CFMSHC and Midstream
                         Fuel Service LLC ("MFSLLC").

         10.3       --   Omnibus Agreement dated November 1, 2002, by and among
                         MRMC, the General Partner, the Partnership and the
                         Operating Partnership.



                                       2
<PAGE>

         10.4       --   Motor Carrier Agreement dated November 1, 2002, by and
                         between the Operating Partnership and Transport.

         10.5       --   Terminal Services Agreement dated November 1, 2002, by
                         and between the Operating Partnership and MGSLLC.

         10.6       --   Throughput Agreement dated November 1, 2002, by and
                         between MGSLLC and the Operating Partnership.

         10.7       --   Contract for Marine Transportation dated November 1,
                         2002, by and between the Operating Partnership and
                         MRMC.

         10.8       --   Product Storage Agreement dated November 1, 2002, by
                         and between Martin Underground Storage, Inc. and the
                         Operating Partnership.

         10.9       --   Marine Fuel Agreement dated November 1, 2002, by and
                         between MFSLLC and the Operating Partnership.

         10.10      --   Product Supply Agreement dated November 1, 2002, by and
                         between MGSLLC and the Operating Partnership.

         10.11      --   Martin Midstream Partners L.P. Long-Term Incentive Plan

         10.12      --   Assignment and Assumption of Lease and Sublease dated
                         November 1, 2002, by and between the Operating
                         Partnership and MGSLLC.

         10.13      --   Purchaser Use Easement, Ingress-Egress Easement, and
                         Utility Facilities Easement dated November 1, 2002, by
                         and between MGSLLC and the Operating Partnership.



                                       3
<PAGE>


                                   SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.

                                      MARTIN MIDSTREAM PARTNERS L.P.

                                      By:  Martin Midstream GP LLC
                                      Its: General Partner


Date:  November 19, 2002              By: /s/ RUBEN S. MARTIN
                                         --------------------------------------
                                          Ruben S. Martin,
                                          President and Chief Executive Officer


                                       4
<PAGE>


                               INDEX TO EXHIBITS

<Table>
<Caption>
EXHIBIT
NUMBER                    DESCRIPTION
------                    -----------
<S>                 <C>
1.1                 --   Underwriting Agreement dated October 31, 2002, by and
                         among Martin Resource Management Corporation ("MRMC"),
                         Martin Resource LLC ("Resource LLC"), Martin Midstream
                         GP LLC (the "General Partner"), Martin Midstream
                         Partners L.P. (the "Partnership"), Martin Operating
                         Partnership L.P. (the "Operating Partnership"), Martin
                         Operating GP LLC (the "Operating General Partner"),
                         Martin Gas Marine LLC ("MGMLLC"), Martin Gas Sales LLC
                         ("MGSLLC"), Martin L.P. Gas, Inc. ("MLP Gas"), CF
                         Martin Sulphur Holding Corporation ("CFMSHC") and the
                         underwriters named therein.

3.1                 --   First Amended and Restated Agreement of Limited
                         Partnership of Martin Midstream Partners L.P., dated
                         November 6, 2002.

3.2                 --   Amended and Restated Agreement of Limited Partnership
                         of Martin Operating Partnership L.P., dated November 6,
                         2002.

10.1                --   Credit Agreement dated November 6, 2002, among the
                         Operating Partnership, as borrower, the Partnership,
                         Royal Bank of Canada, as administrative agent and
                         collateral agent, Comerica Bank-Texas, as co-agent, and
                         the lenders named therein.

10.2                --   Contribution, Conveyance and Assumption Agreement dated
                         October 31, 2002, by and among MRMC, Resource LLC, the
                         General Partner, the Partnership, the Operating
                         Partnership, the Operating General Partner, MGMLLC,
                         Martin Resources, Inc., MLP Gas, MGSLLC, Martin
                         Transport, Inc. ("Transport"), CFMSHC and Midstream
                         Fuel Service LLC ("MFSLLC").

10.3                --   Omnibus Agreement dated November 1, 2002, by and among
                         MRMC, the General Partner, the Partnership and the
                         Operating Partnership.

10.4                --   Motor Carrier Agreement dated November 1, 2002, by and
                         between the Operating Partnership and Transport.

10.5                --   Terminal Services Agreement dated November 1, 2002, by
                         and between the Operating Partnership and MGSLLC.

10.6                --   Throughput Agreement dated November 1, 2002, by and
                         between MGSLLC and the Operating Partnership.

10.7                --   Contract for Marine Transportation dated November 1,
                         2002, by and between the Operating Partnership and
                         MRMC.

10.8                --   Product Storage Agreement dated November 1, 2002, by
                         and between Martin Underground Storage, Inc. and the
                         Operating Partnership.

10.9                --   Marine Fuel Agreement dated November 1, 2002, by and
                         between MFSLLC and the Operating Partnership.
</Table>

                                       5
<PAGE>
<Table>
<S>                 <C>
10.10               --   Product Supply Agreement dated November 1, 2002, by and
                         between MGSLLC and the Operating Partnership.

10.11               --   Martin Midstream Partners L.P. Long-Term Incentive Plan

10.12               --   Assignment and Assumption of Lease and Sublease dated
                         November 1, 2002, by and between the Operating
                         Partnership and MGSLLC.

10.13               --   Purchaser Use Easement, Ingress-Egress Easement, and
                         Utility Facilities Easement dated November 1, 2002, by
                         and between MGSLLC and the Operating Partnership.
</Table>


                                        6

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-1.1
<SEQUENCE>3
<FILENAME>d00990exv1w1.txt
<DESCRIPTION>UNDERWRITING AGREEMENT
<TEXT>
<PAGE>
                                                                    EXHIBIT 1.1




                         MARTIN MIDSTREAM PARTNERS L.P.

                            2,900,000 COMMON UNITS*

                     REPRESENTING LIMITED PARTNER INTERESTS



                             UNDERWRITING AGREEMENT



                                                         St. Petersburg, Florida
                                                                October 31, 2002





Raymond James & Associates, Inc.
A. G. Edwards & Sons, Inc.
RBC Dain Rauscher Inc.
As Representatives of the Several Underwriters
         listed on Schedule I hereto
c/o Raymond James & Associates, Inc.
880 Carillon Parkway
St. Petersburg, Florida 33716

Ladies and Gentlemen:

         Martin Midstream Partners L.P., a Delaware limited partnership (the
"Partnership"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the several Underwriters named in Schedule I hereto (the
"Underwriters"), an aggregate of 2,900,000 common units, each representing a
limited partner interest in the Partnership (the "Common Units"). The aggregate
of 2,900,000 Common Units to be purchased from the Partnership are called the
"Firm Units." In addition, the Partnership has agreed to sell to the
Underwriters, upon the terms and conditions stated herein, up to an additional
435,000 Common Units (the "Additional Units") to cover over-allotments by the
Underwriters, if any. The Firm Units and the Additional Units are collectively
referred to in this Agreement as the "Units." Raymond James & Associates, Inc.,
A.G. Edwards & Sons, Inc. and RBC Dain Rauscher Inc. are acting as the
representatives of the several Underwriters and in such capacity are referred to
in this Agreement as the "Representatives."


----------

* Plus an additional 435,000 units subject to the Underwriters' over-allotment
option.




<PAGE>

         (a) It is understood and agreed to by all parties that the Partnership
was formed to acquire, own and operate, through Martin Operating Partnership
L.P., a Delaware limited partnership (the "Operating Partnership"), certain of
the assets and operations of the marine transportation, terminalling, LPG
distribution and fertilizer business (the "MRMC Business") held by various
subsidiaries of Martin Resource Management Corporation, a Texas corporation
("MRMC"), and, thereafter, to manage such assets and operations as more
particularly described in the Prospectus (as defined herein). On the Closing
Date (as hereinafter defined), the Operating Partnership will have entered into
a Credit Agreement (the "MLP Credit Agreement") with RBC Capital Markets, Royal
Bank of Canada and the lenders named therein (the "MLP Lenders") providing for
borrowings of up to $60.0 million. On the Closing Date, MRMC will have entered
into a Second Amended and Restated Credit Agreement (the "MRMC Credit
Agreement") with JP MorganChase and the lenders named therein (the "MRMC
Lenders"). For the purposes of this Agreement, the term "Permitted Liens" shall
mean liens, encumbrances and/or security interests (i) granted by any of the
Martin Parties (excluding the Partnership Entities) to the MRMC Lenders in
relation to the MRMC Credit Agreement, (ii) granted by any Partnership Entity to
the MLP Lenders in relation to the MLP Credit Agreement or (iii) granted by any
of the Martin Parties pursuant to all of their existing secured debt.

         (b) It is further understood and agreed by all parties hereto that
prior to the date hereof:

         (i) Martin Gas Sales, Inc., a Texas corporation ("MGSI"), converted
under Texas law into Martin Gas Sales LLC, a Texas limited liability company
("MGS");

         (ii) Martin Fuel Service, Inc., an Alabama corporation ("MFSI"),
converted under Alabama law into Midstream Fuel Service LLC, an Alabama limited
liability company ("Midstream"); and

         (iii) Martin Gas Marine, Inc., a Texas corporation ("MGMI"), converted
under Texas law into Martin Gas Marine LLC, a Texas limited liability company
("Marine").

         (c) It is further understood and agreed by all parties that as of the
date hereof:

         (i) Martin Resource LLC, a Delaware limited liability company ("Martin
LLC"), is a wholly-owned direct subsidiary of MRMC;

         (ii) Martin Midstream GP LLC, a Delaware limited liability company (the
"General Partner"), is a wholly-owned direct subsidiary of Martin LLC;

         (iii) the General Partner is the sole general partner of the
Partnership, having a 2% general partner interest in the Partnership;

         (iv) Martin LLC is the sole limited partner of the Partnership, having
a 98% limited partner interest in the Partnership;

         (v) Martin Operating GP LLC, a Delaware limited liability company
("Operating GP"), is a wholly-owned direct subsidiary of Martin LLC;



                                       2
<PAGE>

         (vi) Operating GP is the sole general partner of the Operating
Partnership, having a 0.1% general partner interest in the Operating
Partnership;

         (vii) Martin LLC is the sole limited partner of the Operating
Partnership, having a 99.9% limited partner interest in the Operating
Partnership;

         (viii) each of Martin Resources, Inc., a Texas corporation
("Resources"), Martin Transport, Inc., a Texas corporation ("MTI"), MGS,
Midstream and Marine is a wholly-owned direct subsidiary of MRMC;

         (ix) Martin L.P. Gas, Inc., a Texas corporation ("MLP Gas"), is a
wholly-owned indirect subsidiary of MRMC and a wholly-owned direct subsidiary of
MGS;

         (x) CF Martin Sulphur Holding Corporation, a Nevada corporation
("CFMSHC"), is a wholly-owned indirect subsidiary of MRMC and its direct
shareholders (and ownership percentages) are MGMI (50.06%), MGSI (49.21%) and
MTI (0.73%);

         (xi) MRMC indirectly owns 50% of the membership interests of CF Martin
Sulphur L.L.C., a Delaware limited liability company ("CFMSLLC"), and the direct
members of CFMSLLC (and their ownership percentages) are Marine (25.05%), MTI
(.35%) and MGSI (24.6%);

         (xii) CF Industries Inc., a Delaware corporation ("CFI"), directly owns
50% of the membership interests of CFMSLLC;

         (xiii) CFMSLLC is the sole general partner of CF Martin Sulphur, L.P.,
a Delaware limited partnership ("CFMSLP"), having a 1% general partner interest
in CFMSLP; and

         (xiv) each of CFMSHC and CFI hold a 49.5% limited partner interest in
CFMSLP.

         (d) Prior to or concurrently with the Closing (as defined herein), the
following transactions will occur:

         (i) MRMC will contribute to Martin LLC, as a capital contribution, (i)
all of the outstanding membership interest in Marine and (ii) all of the
outstanding common stock of Resources;

         (ii) Martin LLC will contribute to the Operating Partnership, in
exchange for a limited partner interest in the Operating Partnership, (i) all of
the outstanding membership interest in Marine LLC and (ii) all of the
outstanding common stock of Resources;

         (iii) MGS will contribute to the Operating Partnership all of the
outstanding capital stock of Martin L.P. Gas, Inc., a Texas corporation ("MLP
Gas") and a wholly-owned subsidiary of MGS, in exchange for a limited partner
interest in the Operating Partnership;

         (iv) Resources will merge with and into the Operating Partnership with
the Operating Partnership being the surviving entity;



                                       3
<PAGE>

         (v) MLP Gas will merge with and into the Operating Partnership with the
Operating Partnership being the surviving entity;

         (vi) MGS will contribute to the Operating Partnership the LPG Assets
(as defined in the Contribution, Conveyance and Assumption Agreement, dated as
of the date hereof, among MRMC, the General Partner, the Partnership, Operating
GP, the Operating Partnership, Marine, Resources, MLP Gas, MGS, Martin LLC,
CFMSHC and Midstream (the "Contribution Agreement") in exchange for a limited
partner interest in the Operating Partnership;

         (vii) Midstream will contribute the Tenn-Tom Towing Assets (as defined
in the Contribution Agreement) to the Operating Partnership in exchange for a
limited partner interest in the Operating Partnership;

         (viii) Marine will distribute to the Operating Partnership (i) its
25.05% membership interest in CFMSLLC and (ii) the Marine Retained Assets (as
defined in the Contribution Agreement);

         (ix) Operating Partnership will distribute to Martin LLC the Retained
Assets (as defined in the Contribution Agreement);

         (x) MTI will sell 7.3 shares of common stock of CFMSHC owned by MTI to
MGS in exchange for 40 shares of common stock of MRMC;

         (xi) CFMSHC will liquidate and dissolve and in such liquidation and
dissolution distribute its assets, including its 49.5% interest in CFMSLP, on a
pro-rata basis to its shareholders Marine and MGS, and MGS will immediately
contribute its distributed interest to the Operating Partnership in exchange for
a limited partner interest in the Operating Partnership;

         (xii) MGS will contribute its limited partner interest in the Operating
Partnership to the Partnership in exchange for subordinated units of the
Partnership ("Subordinated Units");

         (xiii) Midstream will contribute its limited partner interest in the
Operating Partnership to the Partnership in exchange for Subordinated Units;

         (xiv) Martin LLC will contribute a portion of its limited partner
interest in the Operating Partnership to the General Partner as a capital
contribution;

         (xv) Martin LLC will contribute (i) its remaining limited partner
interest in the Operating Partnership and (ii) all of its membership interest in
the Operating GP to the Partnership in exchange for Subordinated Units;

         (xvi) the General Partner will contribute the limited partner interest
in the Operating Partnership that it received from Martin LLC to the Partnership
in exchange for (i) a continuation of its 2% general partner interest in the
Partnership and (ii) the issuance of incentive distribution rights ("Incentive
Distribution Rights") under the partnership agreement of the Partnership (the
"Partnership Agreement");





                                       4
<PAGE>

         (xvii) CFMSHC, CFI and CFMSLLC will enter into an amendment to the
Agreement of Limited Partnership of CFMSLP (the "CFMSLP Amendment");

         (xviii) the Operating Partnership will borrow $37,200,000 under the MLP
Credit Agreement;

         (xix) the limited partner interest in the Partnership owned by Martin
LLC will be redeemed for $980; and

         (xx) the public offering of the Firm Units contemplated hereby will be
consummated.

         Promptly after the Closing, Marine will merge with and into the
Operating Partnership with the Operating Partnership being the surviving entity.
The transactions described in the immediately preceding paragraph (d) are
referred to as the "Transactions." In connection with the Transactions, the
parties to the Transactions entered into various bills of sale, deeds, leases,
assignments, conveyances, contribution agreements and related documents
(collectively, the "Conveyances"). The mergers described in clauses (iv) and (v)
of paragraph (d) above are referred to herein as the "Mergers." In connection
with the consummation of the Mergers, the parties to these Transactions entered
into, as applicable, merger agreements and certificates and articles of merger
(the "Merger Documents"). The conversions described in clauses (i) through (iii)
of paragraph (b) above are referred to herein as the "Conversions." In
connection with the consummation of the Conversions, the parties to those
Transactions entered into, as applicable, conversion agreements and certificates
and articles of conversion (the "Conversion Documents"). The Conveyances, Merger
Documents and Conversion Documents are collectively referred to herein as the
"Transaction Documents."

         The General Partner, the Partnership, Operating GP and the Operating
Partnership collectively constitute the "Partnership Entities." MRMC, Martin
LLC, Marine, MGS, MLP Gas, CFMSHC and the Partnership Entities (collectively,
the "Martin Parties") wish to confirm as follows their agreement with you and
the other several Underwriters, on whose behalf you are acting, in connection
with the several purchases of the Units from the Partnership.

         1. Registration Statement and Prospectus. The Partnership has prepared
and filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933 and the rules and
regulations of the Commission thereunder (collectively, the "Act"), a
registration statement on Form S-1 (File No. 333-91706), including a prospectus
subject to completion, relating to the Units. Such registration statement, as
amended, including the financial statements, exhibits and appendices thereto, at
the time when it becomes effective and as thereafter amended by any
post-effective amendment, is referred to in this Agreement as the "Registration
Statement." The prospectus in the form included in the Registration Statement
or, if the prospectus included in the Registration Statement omits certain
information in reliance upon Rule 430A under the Act and such information is
thereafter included in a prospectus filed with the Commission pursuant to Rule
424(b) under the Act or as part of a post-effective amendment to the
Registration Statement after the Registration Statement becomes effective, the
prospectus as so filed, is referred to in this Agreement as the "Prospectus." If
the Partnership elects, with the consent of the Representatives, to rely on Rule
434 under the Act, all references to the Prospectus shall be deemed to include
the form of





                                       5
<PAGE>

prospectus and the term sheet contemplated by Rule 434, taken together, provided
to the Underwriters by the Partnership in reliance on Rule 434 under the Act
(the "Rule 434 Prospectus"). If the Partnership files another registration
statement with the Commission to register a portion of the Units pursuant to
Rule 462(b) under the Act (the "Rule 462 Registration Statement"), then any
reference to "Registration Statement" herein shall be deemed to include the
registration statement on Form S-1 (File No. 333-91706) and the Rule 462
Registration Statement, as each such registration statement may be amended
pursuant to the Act. The prospectus subject to completion in the form included
in the Registration Statement at the time of the initial filing of such
Registration Statement with the Commission and as such prospectus is amended
from time to time until the date of the Prospectus is referred to in this
Agreement as the "Preliminary Prospectus." All references in this Agreement to
the Registration Statement, the Rule 462 Registration Statement, the Rule 434
Prospectus, a Preliminary Prospectus or the Prospectus, or any amendments or
supplements to any of the foregoing, shall include any copy thereof filed with
the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval
System ("EDGAR").

         2. Agreements to Sell and Purchase. The Partnership hereby agrees to
issue and sell the Firm Units to the Underwriters and, upon the basis of the
representations, warranties and agreements of the Martin Parties herein
contained and subject to all the terms and conditions set forth herein, each
Underwriter agrees, severally and not jointly, to purchase from the Partnership
at a purchase price of $17.67 per Unit (the "purchase price per Unit"), the
number of Firm Units set forth opposite the name of such Underwriter in Schedule
I hereto.

         The Partnership hereby also agrees to sell to the Underwriters, and,
upon the basis of the representations, warranties and agreements of the Martin
Parties herein contained and subject to all the terms and conditions set forth
herein, the Underwriters shall have the right for 30 days from the date of the
Prospectus to purchase from the Partnership, up to 435,000 Additional Units at
the same purchase price per Unit as paid for the Firm Units. The Additional
Units may be purchased solely for the purpose of covering over-allotments, if
any, made in connection with the offering of the Firm Units. If any Additional
Units are to be purchased, each Underwriter, severally and not jointly, agrees
to purchase the number of Additional Units (subject to such adjustments as you
may determine to avoid fractional shares) that bears the same proportion to the
total number of Additional Units to be purchased by the Underwriters as the
number of Units set forth opposite the name of such Underwriter in Schedule I
hereto bears to the total number of Units. The option to purchase Additional
Units may be exercised at any time within 30 days after the date of the
Prospectus, but no more than once.

         3. Terms of Public Offering. The Partnership has been advised by you
that the Underwriters propose to make a public offering of their respective
portions of the Units as soon after the Registration Statement and this
Agreement have become effective as in your judgment is advisable and initially
to offer the Units upon the terms set forth in the Prospectus.

         Not later than 12:00 p.m. on the second business day following the date
the Units are released by the Underwriters for sale to the public, the
Partnership shall deliver or cause to be delivered copies of the Prospectus in
such quantities and at such places as the Representatives shall request.




                                       6
<PAGE>

         4. Delivery of the Units and Payment Therefor. Delivery to the
Underwriters of the Firm Units and payment therefor (the "Closing") shall be
made at the offices of Baker Botts L.L.P., 2001 Ross Avenue, Dallas, Texas at
8:30 a.m., Dallas, Texas time, on November 6, or such other place, time and date
not later than 1:30 p.m., Dallas, Texas time, on November 6, as the
Representatives shall designate by notice to the Partnership (the time and date
of such closing are called the "Closing Date"). The place of the Closing and the
Closing Date may be varied by agreement between you and the Partnership. The
Partnership hereby acknowledges that circumstances under which the
Representatives may provide notice to postpone the Closing Date as originally
scheduled include any determination by the Partnership or the Representatives to
recirculate to the public copies of an amended or supplemented Prospectus or a
delay as contemplated by the provisions of Section 11 hereof.

         Delivery to the Underwriters of and payment for any Additional Units to
be purchased by the Underwriters (the "Additional Closing") shall be made at the
offices of Baker Botts L.L.P, 2001 Ross Avenue, Dallas, Texas, at 10:00 a.m.,
Dallas, Texas time, on such date or dates (the "Additional Closing Date") (which
may be the same as the Closing Date, but shall in no event be earlier than the
Closing Date nor earlier than three nor later than ten business days after the
giving of the notice hereinafter referred to; the Closing Date and the
Additional Closing Date are sometimes each referred to herein as a "Closing
Date") as shall be specified in a written notice, from the Representatives on
behalf of the Underwriters to the Partnership, of the Underwriters'
determination to purchase a number, specified in such notice, of Additional
Units. Such notice may be given at any time within 30 days after the date of the
Prospectus and must set forth (i) the aggregate number of Additional Units as to
which the Underwriters are exercising the option and (ii) the names and
denominations in which the certificates for which the Additional Units are to be
registered. The place of the Additional Closing and the Additional Closing Date
may be varied by agreement between you and the Partnership.

         Certificates for the Firm Units and for any Additional Units to be
purchased hereunder shall be registered in such names and in such denominations
as you shall request prior to 1:00 p.m., Dallas, Texas time, not later than the
second full business day preceding the Closing Date or the Additional Closing
Date, as the case may be. Such certificates shall be made available to you in
Dallas, Texas for inspection and packaging not later than 9:30 a.m., Dallas,
Texas time, on the business day immediately preceding the Closing Date or the
Additional Closing Date, as the case may be. The certificates evidencing the
Firm Units and any Additional Units to be purchased hereunder shall be delivered
to you on the Closing Date or the Additional Closing Date, as the case may be,
against payment of the purchase price therefore by wire transfer of immediately
available funds to an account specified in writing, not later than the close of
business on the business day next preceding the Closing Date or the Additional
Closing Date, as the case may be, by the Partnership. Payment for the Units sold
by the Partnership hereunder shall be delivered by the Representatives to the
Partnership.

         It is understood that the Representatives have been authorized, for
their own accounts and the accounts of the several Underwriters, to accept
delivery of and receipt for, and make payment of the purchase price per Unit for
the Firm Units and the Additional Units, if any, that the Underwriters have
agreed to purchase. Raymond James and Associates, Inc., individually and not as
a Representative of the Underwriters, may, but shall not be obligated to, make
payment for any Units to be purchased by any Underwriter whose funds shall not
have been received by the




                                       7
<PAGE>

Representatives by the Closing Date or the Additional Closing Date, as the case
may be, for the account of such Underwriter, but any such payment shall not
relieve such Underwriter from any of its obligations under this Agreement.

         5. Covenants and Agreements of the Martin Parties. Each of the Martin
Parties, jointly and severally, covenants and agrees with the several
Underwriters as follows:

               (a) Preparation of Registration Statement and Prospectus. The
Martin Parties will use their best efforts to cause the Registration Statement
and any amendments thereto to become effective, if it has not already become
effective, and will advise you promptly and, if requested by you, will confirm
such advice in writing (i) when the Registration Statement has become effective
and the time and date of any filing of any post-effective Registration Statement
or any amendment or supplement to any Preliminary Prospectus or the Prospectus
and the time and date that any post-effective amendment to the Registration
Statement becomes effective, (ii) if Rule 430A under the Act is employed, when
the Prospectus has been timely filed pursuant to Rule 424(b) under the Act,
(iii) of the receipt of any comments of the Commission, or any request by the
Commission for amendments or supplements to the Registration Statement, any
Preliminary Prospectus or the Prospectus or for additional information, (iv) of
the issuance by the Commission of any stop order suspending the effectiveness of
the Registration Statement or of the suspension of qualification of the Units
for offering or sale in any jurisdiction or the initiation of any proceeding for
such purposes and (v) within the period of time referred to in Section 5(e)
below, of any event that comes to the attention of any of the Martin Parties or
Partnership Entities that makes any statement made in the Registration Statement
or the Prospectus (as then amended or supplemented) untrue in any material
respect or that requires the making of any additions thereto or changes therein
in order to make the statements therein (in the case of the Prospectus, in light
of the circumstances under which they were made) not misleading in any material
respect, or of the necessity to amend or supplement the Prospectus (as then
amended or supplemented) to comply with the Act or any other law. If at any time
the Commission shall issue any stop order suspending the effectiveness of the
Registration Statement, the Martin Parties will make every reasonable effort to
obtain the withdrawal or lifting of such order at the earliest possible time. If
the Partnership elects, with the consent of the Representatives, to rely on Rule
434 under the Act, the Martin Parties will provide the Underwriters with copies
of the form of Rule 434 Prospectus (including copies of a term sheet that
complies with the requirements of Rule 434 under the Act), in such number as the
Underwriters may reasonably request, and file with the Commission in accordance
with Rule 424(b) of the Act the form of Prospectus complying with Rule 434(b)(2)
of the Act before the close of business on the first business day immediately
following the date hereof. If the Partnership elects not to rely on Rule 434
under the Act, the Martin Parties will provide the Underwriters with copies of
the form of Prospectus, in such number as the Underwriters may reasonably
request, and file with the Commission such Prospectus in accordance with Rule
424(b) of the Act before the close of business on the first business day
immediately following the date hereof.

               (b) Signed Copies of Registration Statements. The Martin Parties
will furnish to you, without charge, two signed duplicate originals of the
Registration Statement as originally filed with the Commission and of each
amendment thereto, including financial statements and all exhibits thereto, and
will also furnish to you, without charge, such number of conformed copies




                                       8
<PAGE>

of the Registration Statement as originally filed and of each amendment thereto
as you may reasonably request.

               (c) Amendments to Registration Statement. The Martin Parties will
not file any Rule 462 Registration Statement or any amendment to the
Registration Statement or make any amendment or supplement to the Prospectus
unless (i) you shall have previously been advised thereof and been given a
reasonable opportunity to review such filing, amendment or supplement and (ii)
you have not reasonably objected to such filing, amendment or supplement after
being so advised and having been given a reasonable opportunity to review such
filing, amendment or supplement.

               (d) Copies of the Preliminary Prospectus. Prior to the execution
and delivery of this Agreement, the Martin Parties have delivered or will
deliver to you, without charge, in such quantities as you have requested or may
hereafter reasonably request, copies of each form of the Preliminary Prospectus.
Consistent with the provisions of Section 5(e) hereof, the Partnership consents
to the use, in accordance with the provisions of the Act and with the securities
or Blue Sky laws of the jurisdictions in which the Units are offered by the
several Underwriters and by dealers, prior to the date of the Prospectus, of
each Preliminary Prospectus so furnished by the Martin Parties.

               (e) Copies of the Prospectus. As soon after the execution and
delivery of this Agreement as is practicable and thereafter from time to time
for such period as in the reasonable opinion of counsel for the Underwriters a
prospectus is required by the Act to be delivered in connection with sales by
any Underwriter or a dealer (the "Prospectus Delivery Period"), the Partnership
will deliver to each Underwriter and each dealer, without charge, as many copies
of the Prospectus (and of any amendment or supplement thereto) as they may
reasonably request. The Partnership consents to the use of the Prospectus (and
of any amendment or supplement thereto) in accordance with the provisions of the
Act and with the securities or Blue Sky laws of the jurisdictions in which the
Units are offered by the several Underwriters and by all dealers to whom Units
may be sold, both in connection with the offering and sale of the Units and for
such period of time thereafter as the Prospectus is required by the Act to be
delivered in connection with sales by any Underwriter or dealer. If at any time
prior to the later of (i) the completion of the distribution of the Units
pursuant to the offering contemplated by the Registration Statement or (ii) the
expiration of prospectus delivery requirements with respect to the Units under
Section 4(3) of the Act and Rule 174 thereunder, any event shall occur that in
the judgment of the Martin Parties or in the opinion of counsel for the
Underwriters is required to be set forth in the Prospectus (as then amended or
supplemented) or should be set forth therein in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading, or if it is necessary to supplement or amend the Prospectus to
comply with the Act or any other law, the Martin Parties will forthwith prepare
and, subject to Sections 5(a) and 5(c) hereof, file with the Commission and use
their best efforts to cause to become effective as promptly as possible an
appropriate supplement or amendment thereto, and will furnish to each
Underwriter who has previously requested Prospectuses, without charge, a
reasonable number of copies thereof.

               (f) Blue Sky Qualification. The Martin Parties will cooperate
with you and counsel for the Underwriters in connection with the registration or
qualification of the Units for offering and sale by the several Underwriters and
by dealers under the securities or Blue Sky





                                       9
<PAGE>

laws of such jurisdictions as you may reasonably designate and will file such
consents to service of process or other documents as may be reasonably necessary
in order to effect and maintain such registration or qualification for so long
as required to complete the distribution of the Units; provided that in no event
shall any Partnership Entity be obligated to qualify to do business in any
jurisdiction where it is not now so qualified or to take any action that would
subject it to general service of process in suits, other than those arising out
of the offering or sale of the Units, as contemplated by this Agreement and the
Prospectus, in any jurisdiction where it is not now so subject. In the event
that the qualification of the Units in any jurisdiction is suspended, the Martin
Parties shall so advise you promptly in writing. The Partnership Entities will
comply with such Blue Sky laws and will continue such qualifications,
registrations and exemptions in effect for so long as required to complete the
distribution of the Units.

               (g) Reports to Security Holders. The Martin Parties will make
generally available to security holders of the Partnership a consolidated
earnings statement of the Partnership (in form complying with the provisions of
Rule 158), which need not be audited, covering a twelve-month period commencing
after the effective date of the Registration Statement and the Rule 462
Registration Statement, if any, and ending not later than 15 months thereafter,
as soon as practicable after the end of such period, which consolidated earnings
statement shall satisfy the provisions of Section 11(a) of the Act.

               (h) Copies of Reports. During the period ending two years from
the date hereof, the Martin Parties will furnish to you and, upon your request,
to each of the other Underwriters, (i) as soon as practical, copies of all
materials furnished by the Partnership to its security holders or filed with the
Commission, the National Association of Securities Dealers, Inc. (the "NASD") or
the Nasdaq Stock Market ("NASDAQ") or any national securities exchange.

               (i) Expenses. If this Agreement shall terminate or shall be
terminated after execution pursuant to any provision hereof or if this Agreement
shall be terminated by the Underwriters because of any inability, failure or
refusal on the part of the Martin Parties to perform in all material respects
any agreement herein or to comply in all material respects with any of the terms
or provisions hereof or to fulfill in all material respects any of the
conditions of this Agreement, the Martin Parties agree to reimburse you and the
other Underwriters for all out-of-pocket expenses (including travel expenses and
reasonable fees and expenses of counsel for the Underwriters, but excluding
wages and salaries paid by you) reasonably incurred by you in connection
herewith; provided that such reimbursement amount shall not exceed $350,000.

               (j) Application of Proceeds. The Martin Parties will cause the
Partnership to apply the net proceeds from the sale of the Units to be sold by
it hereunder in accordance in all material respects with the statements under
the caption "Use of Proceeds" in the Prospectus.

               (k) Rule 430A. If Rule 430A under the Act is employed, the Martin
Parties will cause the Partnership to timely file the Prospectus or term sheet
(as described in Rule 434(b) under the Act) pursuant to Rule 424(b) under the
Act.

               (l) Lock-up Period. For a period of 180 days after the date of
the Prospectus first filed pursuant to Rule 424(b) under the Act, the Martin
Parties will cause the Partnership not




                                       10
<PAGE>

to, directly or indirectly, (i) issue, sell, offer or contract to sell or
otherwise dispose of or transfer any Common Units or securities convertible into
or exchangeable or exercisable for Common Units (collectively, "Partnership
Units") or any rights to purchase Partnership Units, or file any registration
statement under the Act with respect to any of the foregoing, or (ii) enter into
any swap or other agreement that transfers, in whole or in part, directly or
indirectly, the economic consequences of ownership of Partnership Units whether
any such swap or transaction is to be settled by delivery of Common Units or
other securities, in cash or otherwise, in each case without the prior written
consent of the Representatives on behalf of the Underwriters; provided, however,
that the foregoing restrictions do not apply to (A) the sale of Common Units to
the Underwriters pursuant to this Agreement, (B) the issuance of Common Units by
the Partnership to employee benefit plans, qualified unit option plans or other
employee compensation plans and issuances of Common Units upon the exercise of
options under such plans and (C) the issuance of Common Units in connection with
accretive acquisitions made by the Partnership provided that the recipients of
those Common Units agree to be bound by the restrictions in this paragraph (l).

               (m) Copies of Financial Statements. Prior to the Closing Date or
the Additional Closing Date, as the case may be, the Martin Parties will furnish
to you, as promptly as possible, copies of any unaudited interim consolidated
financial statements of the Partnership and its subsidiaries for any period
subsequent to the periods covered by the financial statements appearing in the
Prospectus.

               (n) Undertakings. The Martin Parties will cause the Partnership
to comply with all provisions of any undertakings contained in the Registration
Statement.

               (o) Stabilization or Manipulation. The Martin Parties will not at
any time, directly or indirectly, take any action designed, or which might
reasonably be expected to cause or result in, or which will constitute,
stabilization or manipulation of the price of Common Units to facilitate the
sale or resale of any of the Units.

               (p) NASDAQ Requirements. The Martin Parties will cause the
Partnership to timely file with NASDAQ all documents and notices required by
NASDAQ of companies that have or will issue securities that are traded on
NASDAQ. The Martin Parties will use their best efforts to complete the inclusion
of the Units on NASDAQ, subject only to official notice of issuance, prior to
the Closing Date.

               (q) Transfer Agent and Registrar. The Martin Parties will cause
the Partnership to engage and maintain, at its expense, a transfer agent and, if
necessary under the jurisdiction of its formation or the rules of any national
securities exchange or automated quotation system on which the Common Units are
listed, a registrar (which, if permitted by applicable laws and rules may be the
same entity as the transfer agent) for the Common Units.

               (r) Consents. The Martin Parties will accomplish or obtain as
soon as practicable all consents, recordings and filings necessary to perfect,
preserve and protect the title of the Operating Partnership to the properties
and assets owned by it as a result of the Transactions.




                                       11
<PAGE>


               (s) Directed Unit Program. It is understood that up to 150,000 of
the Firm Units (the "Directed Units") will initially be reserved by the
Underwriters for offer and sale to officers, directors, employees and persons
having business relationships with the Martin Parties ("Directed Unit
Participants") upon the terms and conditions set forth in the Prospectus and in
accordance with the rules and regulations of the National Association of
Securities Dealers, Inc. (the "Directed Unit Program"). Under no circumstances
will any Underwriter be liable to the Martin Parties or to any Directed Unit
Participant for any action taken or omitted to be taken in good faith in
connection with such Directed Unit Program. To the extent that any Directed
Units are not affirmatively reconfirmed for purchase by any Directed Unit
Participant on or immediately after the date of this Agreement, such Directed
Units may be offered to the public as part of the public offering contemplated
hereby.

               (t) NASD Requirements. The Martin Parties will cause each annual
report distributed to the security holders of the Partnership to comply with
NASD Rule 2810(b)(5).

         6. Representations and Warranties of the Martin Parties. Each of the
Martin Parties, jointly and severally, hereby represents and warrants to each
Underwriter that:

               (a) Preliminary Prospectus. Each Preliminary Prospectus included
as part of the Registration Statement as originally filed or as part of any
amendment or supplement thereto, or filed pursuant to Rule 424(a) under the Act,
complied as to form when so filed in all material respects with the provisions
of the Act, except that this representation and warranty does not apply to
statements in or omissions from such Preliminary Prospectus (or any amendment or
supplement thereto) made in reliance upon and in conformity with information
relating to any Underwriter furnished to the Partnership in writing by or on
behalf of any Underwriter through you expressly for use therein. The Commission
has not issued any order preventing or suspending the use of any Preliminary
Prospectus and no proceeding for that purpose has been instituted or threatened
by the Commission or the securities authority of any state or other
jurisdiction.

               (b) No Material Misstatements or Omissions. The Partnership has
prepared each of the Registration Statement, any Rule 462 Registration Statement
and will prepare any post-effective amendment thereto, and the Prospectus and
any amendments or supplements thereto. The Registration Statement (including any
Rule 462 Registration Statement), in the form in which it becomes effective and
also in such form as it may be when any post-effective amendment thereto shall
become effective, and the Prospectus, and any supplement or amendment thereto
when filed with the Commission under Rule 424(b) under the Act, will comply as
to form in all material respects with the provisions of the Act and will not at
any such times contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except that this representation and warranty does not
apply to statements in or omissions from the Registration Statement or the
Prospectus (or any amendment or supplement thereto) made in reliance upon and in
conformity with information relating to any Underwriter furnished to the
Partnership in writing by or on behalf of any Underwriter through you expressly
for use therein.

               (c) Conformity of EDGAR Filings. To the best knowledge of the
Martin Parties, each Preliminary Prospectus and the Prospectus, if filed by
electronic transmission




                                       12
<PAGE>

pursuant to EDGAR (except as may be permitted by Regulation S-T under the Act),
was or will be identical to the copy thereof delivered to the Underwriters for
use in connection with the offer and sale of the Units.

               (d) Formation and Qualification of the Partnership and the
Operating Partnership. Each of the Partnership and the Operating Partnership has
been duly formed and is validly existing in good standing as a limited
partnership under the Delaware Revised Uniform Limited Partnership Act (the
"Delaware LP Act") with full partnership power and authority to own or lease and
operate its properties to be owned or leased and operated by it at each Closing
Date, to assume the liabilities being assumed by it pursuant to the Transaction
Documents and to conduct its business as presently conducted and as described in
the Registration Statement and the Prospectus (and any amendment or supplement
thereto), in each case in all material respects. Each of the Partnership and the
Operating Partnership is duly registered or qualified as a foreign limited
partnership for the transaction of business under the laws of each jurisdiction
in which the character of the business to be conducted by it at each Closing
Date or the nature or location of the properties to be owned or leased by it at
each Closing Date makes such registration or qualification necessary, except
where the failure so to register or qualify would not (i) have a material
adverse effect on the condition (financial or otherwise), business, properties,
net worth or results of operations of the Partnership Entities (a "Material
Adverse Effect") or (ii) subject the limited partners of the Partnership to any
material liability or disability.

               (e) Formation and Qualification of Martin LLC, the General
Partner and Operating GP. Each of Martin LLC, the General Partner and Operating
GP has been duly formed and is validly existing in good standing as a limited
liability company under the Delaware Limited Liability Company Act (the
"Delaware LLC Act") with full limited liability company power and authority to
own, lease and operate its properties to be owned or leased and operated by it
at each Closing Date, to assume the liabilities being assumed by it pursuant to
the Transaction Documents, to conduct its business as presently conducted and as
described in the Registration Statement and the Prospectus (and any amendment or
supplement thereto), and (i) with respect to the General Partner, to act as
general partner of the Partnership, and (ii) with respect to Operating GP, to
act as general partner of the Operating Partnership, in each case in all
material respects. Each of Martin LLC, the General Partner and Operating GP is
duly registered or qualified as a foreign limited liability company for the
transaction of business under the laws of each jurisdiction in which the
character of the business to be conducted by it at each Closing Date or the
nature or location of the properties to be owned or leased by it at each Closing
Date makes such registration or qualification necessary, except where the
failure so to register or qualify would not (i) have a Material Adverse Effect
or (ii) subject the limited partners of the Partnership to any material
liability or disability.

               (f) Formation and Qualification of CFMSLP. CFMSLP has been duly
formed and is validly existing in good standing as a limited partnership under
the Delaware LP Act with full partnership power and authority to own or lease
and operate its properties to be owned or leased and operated by it at each
Closing Date and to conduct its business as presently conducted and as described
in the Registration Statement and the Prospectus (and any amendment or
supplement thereto), in each case in all material respects. CFMSLP is duly
registered or qualified as a foreign limited partnership for the transaction of
business under the laws of each jurisdiction in which the character of the
business to be conducted by it at each




                                       13
<PAGE>

Closing Date or the nature or location of the properties to be owned or leased
by it at each Closing Date makes such registration or qualification necessary,
except where the failure so to register or qualify would not (i) have a Material
Adverse Effect or (ii) subject the Operating Partnership, as a limited partner
of CFMSLP, to any material liability or disability.

               (g) Ownership of General Partner Interest. On the Closing Date
and the Additional Closing Date, as the case may be, the General Partner will be
the sole general partner of the Partnership with a 2% general partner interest
in the Partnership; such general partner interest will be duly authorized and
validly issued in accordance with the First Amended and Restated Agreement of
Limited Partnership of the Partnership (the "Partnership Agreement"); and the
General Partner will own such general partner interest free and clear of all
liens, encumbrances, security interests, charges or claims, except for Permitted
Liens, applicable securities laws and any restrictions set forth in the
Partnership Agreement.

               (h) Ownership of the Sponsor Units and Incentive Distribution
Rights. On the Closing Date and the Additional Closing Date, as the case may be,
MGS will own 1,543,797 Subordinated Units, Midstream will own 620,644
Subordinated Units and Martin LLC will own 2,088,921 Subordinated Units (all
such Subordinated Units being collectively referred to herein as the "Sponsor
Units"); all of such Sponsor Units and the limited partner interests represented
thereby will be duly authorized and validly issued in accordance with the
Partnership Agreement, fully paid (to the extent required under the Partnership
Agreement) and nonassessable (except as such nonassessability may be affected by
matters described in the Prospectus under the caption "The Partnership
Agreement--Limited Liability"); the General Partner will own all of the
Incentive Distribution Rights, and such Incentive Distribution Rights will be
duly authorized and validly issued in accordance with the Partnership Agreement,
and fully paid (to the extent required under the Partnership Agreement) and
nonassessable (except as such nonassessability may be affected by matters
described in the Prospectus under the caption "The Partnership
Agreement--Limited Liability"); and the Sponsor Units and the Incentive
Distribution Rights will be owned free and clear of all liens, encumbrances,
security interests, charges or claims, except for Permitted Liens, applicable
securities laws, any restrictions set forth in the Partnership Agreement and,
with respect to the Incentive Distribution Rights, any restrictions on
transferability set forth in the governing documents of the Partnership
Entities.

               (i) Valid Issuance of Units. On the Closing Date and the
Additional Closing Date, as the case may be, the Firm Units and the Additional
Units, as the case may be, and the limited partner interests represented
thereby, will be duly authorized by the Partnership Agreement and, when issued
and delivered to the Underwriters against payment therefore in accordance with
the terms hereof, will be validly issued, fully paid (to the extent required
under the Partnership Agreement) and nonassessable (except as such
nonassessability may be affected by matters described in the Prospectus under
the caption "The Partnership Agreement--Limited Liability"); and other than the
Sponsor Units and the Incentive Distribution Rights, the Units are the only
limited partner interests of the Partnership issued and outstanding.

               (j) Ownership of Martin LLC. At each Closing Date, MRMC will own
a 100% member interest in Martin LLC; such member interest will be duly
authorized and validly issued in accordance with the limited liability company
agreement of Martin LLC (as the same may be amended and restated at or prior to
each Closing Date, the "Martin LLC Agreement")





                                       14
<PAGE>

and will be fully paid (to the extent required under the Martin LLC Agreement)
and nonassessable (except as such nonassessability may be affected by Section
18-607 of the Delaware LLC Act); and MRMC will own such member interest free and
clear of all liens, encumbrances, security interests, charges or claims, except
for Permitted Liens and applicable securities laws and any restrictions set
forth in the Martin LLC Agreement.

               (k) Ownership of Operating GP. At each Closing Date, the
Partnership will own a 100% member interest in Operating GP; such member
interest will be duly authorized and validly issued in accordance with the
limited liability company agreement of Operating GP (as the same may be amended
and restated at or prior to each Closing Date, the "Operating GP Agreement") and
will be fully paid (to the extent required under the Operating GP Agreement) and
nonassessable (except as such nonassessability may be affected by Section 18-607
of the Delaware LLC Act); and the Partnership will own such member interest free
and clear of all liens, encumbrances, security interests, charges or claims,
except for Permitted Liens, applicable securities laws and any restrictions set
forth in the Operating GP Agreement.

               (l) Ownership of the Operating Partnership. At each Closing Date,

                  (i) Operating GP will be the sole general partner of the
         Operating Partnership with a 0.1% general partner interest in the
         Operating Partnership; such general partner interest will be duly
         authorized and validly issued in accordance with the partnership
         agreement of the Operating Partnership (as the same may be amended and
         restated at or prior to each Closing Date, the "Operating Partnership
         Agreement"); and Operating GP will own such general partner interest
         free and clear of all liens, encumbrances (except any restrictions on
         transferability as described in the Prospectus), security interests,
         charges or claims, except for Permitted Liens, applicable securities
         laws and any restrictions set forth in the Operating Partnership
         Agreement; and

                  (ii) the Partnership will be the sole limited partner of the
         Operating Partnership with a 99.9% limited partner interest in the
         Operating Partnership; such limited partner interest will be duly
         authorized and validly issued in accordance with the Operating
         Partnership Agreement and will be fully paid (to the extent required
         under the Operating Partnership Agreement) and nonassessable (except as
         such nonassessability may be affected by Sections 17-303 and 17-607 of
         the Delaware LP Act); and the Partnership will own such limited partner
         interest free and clear of all liens, encumbrances, security interests,
         charges or claims, except for Permitted Liens, applicable securities
         laws and any restrictions set forth in the Operating Partnership
         Agreement.

               (m) Ownership of General Partner. At each Closing Date, Martin
LLC will own 100% of the member interests in the General Partner; such member
interest will be duly authorized and validly issued in accordance with the
limited liability company agreement of the General Partner (as the same may be
amended and restated at or prior to each Closing Date, the "General Partner LLC
Agreement") and will be fully paid (to the extent required under the General
Partner LLC Agreement) and nonassessable (except as such nonassessability may be
affected by Section 18-607 of the Delaware LLC Act); and Martin LLC will own
such member interest free and clear of all liens, encumbrances, security
interests, charges or claims, except for




                                       15
<PAGE>

Permitted Liens, applicable securities laws and any restrictions in the General
Partner LLC Agreement.

               (n) Ownership of Limited Partner Interest in CFMSLP. At each
Closing Date, the Operating Partnership will be a limited partner of CFMSLP with
a 49.5% limited partner interest in CFMSLP; such limited partner interest has
been duly authorized and validly issued in accordance with the partnership
agreement, as amended, of CFMSLP and is fully paid (to the extent required under
the partnership agreement, as amended, of CFMSLP) and nonassessable (except as
such nonassessability may be affected by Sections 17-303 and 17-607 of the
Delaware LP Act); and the Operating Partnership will own such limited partner
interest free and clear of all liens, encumbrances, security interests, charges
or claims, other than transfer restrictions and buy/sell obligations contained
in the organizational documents of CFMSLP or its general partner, applicable
securities laws and any restrictions set forth in the governing documents of the
Partnership Entities.

               (o) No Other Subsidiaries. Upon the completion of the
transactions summarized in the introductory paragraphs of this Agreement, at
each Closing Date, other than (i) the Partnership's ownership of a 100% member
interest in Operating GP and a 99.9% limited partner interest in the Operating
Partnership, (ii) Operating GP's ownership of a 0.1% general partner interest in
the Operating Partnership and (iii) the Operating Partnership's ownership of a
49.5% limited partner interest in CFMSLP, none of the Partnership, Operating GP,
or the Operating Partnership will own, directly or indirectly, any equity or
long-term debt securities of any corporation, partnership, limited liability
company, joint venture, association or other entity. Upon the completion of the
transactions summarized in the introductory paragraphs of this Agreement, at
each Closing Date, other than its ownership of its partnership interests in the
Partnership, the General Partner will not own, directly or indirectly, any
equity or long-term debt securities of any corporation, partnership, limited
liability company, joint venture, association or other entity.

               (p) No Preemptive Rights, Registration Rights or Options. Except
as described in the Prospectus, there are no preemptive rights or other rights
to subscribe for or to purchase, nor any restriction upon the voting or transfer
of, any partnership or member interests in the Partnership Entities, in each
case pursuant to the organizational documents or any agreement or other
instrument to which any Partnership Entity is a party or by which any of them
may be bound. Neither the filing of the Registration Statement nor the offering
or sale of the Units as contemplated by this Agreement gives rise to any rights
for or relating to the registration of any Units or other securities of any
Partnership Entity, other than as described in the Prospectus and the
Partnership Agreement or as have been waived. Except as described in the
Prospectus, there are not outstanding options or warrants to purchase any
partnership or member interests in any Partnership Entity.

               (q) Authority. The Partnership has all necessary limited
partnership power and authority to issue, sell and deliver (i) the Units, in
accordance with and upon the terms and conditions set forth in this Agreement,
the Partnership Agreement, the Registration Statement and the Prospectus, and
(ii) the Subordinated Units and the Incentive Distribution Rights, in accordance
with the terms and conditions set forth in the Partnership Agreement and the
Transaction Documents. All corporate, partnership and limited liability company
action, as the





                                       16
<PAGE>

case may be, required to be taken by the Martin Parties or any of their
stockholders, partners or members for the authorization, issuance, sale and
delivery of the Units, the Subordinated Units and the Incentive Distribution
Rights, the execution and delivery of the Operative Agreements (as defined in
Section 6(t)) and the consummation of the transactions (including the
Transactions) contemplated by this Agreement and the Operative Agreements has
been, or prior to the Closing will be, validly taken.

               (r) Enforceability of Agreement. This Agreement has been duly
authorized and validly executed and delivered by each of the Martin Parties and
constitutes the valid and legally binding agreement of each of them, enforceable
against each of them in accordance with its terms; provided that the
enforceability hereof may be limited by bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer and similar laws relating to or affecting
creditors' rights generally and by general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law)
and an implied covenant of good faith and fair dealing; and provided further,
that the indemnity and contribution provisions hereunder may be limited by
federal or state securities laws.

               (s) Conformity to Description of the Units, the Subordinated
Units and the Incentive Distribution Rights. The Units, when issued and
delivered against payment therefor as provided herein, and the Subordinated
Units and the Incentive Distribution Rights, when issued and delivered in
accordance with the terms of the Partnership Agreement, will conform in all
material respects to the descriptions thereof contained in the Prospectus.

               (t) Enforceability of Other Agreements. At or before the Closing:

                  (i) the Partnership Agreement will be duly authorized,
         executed and delivered by the General Partner and Martin LLC as the
         "Organizational Limited Partner," and will be a valid and legally
         binding agreement of the General Partner and the Organizational Limited
         Partner, enforceable against the General Partner and the Organizational
         Limited Partner in accordance with its terms;

                  (ii) the Martin LLC Agreement will be duly authorized,
         executed and delivered by MRMC and will be a valid and legally binding
         agreement of MRMC, enforceable against MRMC in accordance with its
         terms;

                  (iii) the Operating GP Agreement will be duly authorized,
         executed and delivered by the Partnership and will be a valid and
         legally binding agreement of the Partnership, enforceable against the
         Partnership in accordance with its terms;

                  (iv) the Operating Partnership Agreement will be duly
         authorized, executed and delivered by Operating GP and the Partnership
         and will be a valid and legally binding agreement of Operating GP and
         the Partnership, enforceable against Operating GP and the Partnership
         in accordance with its terms;

                  (v) the General Partner LLC Agreement will be duly authorized,
         executed and delivered by Martin LLC and will be a valid and legally
         binding agreement of Martin LLC enforceable against Martin LLC in
         accordance with its terms;




                                       17
<PAGE>


                  (vi) each of the Transaction Documents will be duly
         authorized, executed and delivered by the parties thereto and will be
         valid and legally binding agreements of each of them, enforceable
         against each of them in accordance with its terms;

                  (vii) the omnibus agreement (the "Omnibus Agreement") will be
         duly authorized, executed and delivered by each of MRMC, the General
         Partner, the Partnership and the Operating Partnership, and will be
         valid and legally binding agreement of each of them, enforceable
         against each of them in accordance with its terms;

                  (viii) the motor carrier agreement (the "Motor Carrier
         Agreement") will be duly authorized, executed and delivered by each of
         the Partnership and MTI, and will be a valid and legally binding
         agreement of each of them, enforceable against each of them in
         accordance with its terms;

                  (ix) the product supply agreement (the "Product Supply
         Agreement") will be duly authorized, executed and delivered by each of
         the Partnership and MGS and will be a valid and legally binding
         agreement of each of them, enforceable against each of them in
         accordance with its terms;

                  (x) the marine fuel agreement (the "Marine Fuel Agreement")
         will be duly authorized, executed and delivered by each of the
         Partnership and Midstream and will be a valid and legally binding
         agreement of each of them, enforceable against each of them in
         accordance with its terms;

                  (xi) the product storage agreement (the "Product Storage
         Agreement") will be duly authorized, executed and delivered by each of
         the Partnership and Martin Underground Storage, Inc. and will be a
         valid and legally binding agreement of each of them, enforceable
         against each of them in accordance with its terms;

                  (xii) the terminal services agreement (the "Terminal Services
         Agreement") will be duly authorized, executed and delivered by each of
         the Partnership and MGS and will be a valid and legally binding
         agreement of each of them, enforceable against each of them in
         accordance with its terms;

                  (xiii) the contract for marine transportation (the "Marine
         Transportation Agreement") will be duly authorized, executed and
         delivered by each of the Partnership and MRMC and will be a valid and
         legally binding agreement of each of them, enforceable against each of
         them in accordance with its terms;

                  (xiv) the throughput agreement (the "Throughput Agreement")
         will be duly authorized, executed and delivered by each of the
         Partnership and MGS and will be a valid and legally binding agreement
         of each of them, enforceable against each of them in accordance with
         its terms; and

                  (xv) the MLP Credit Agreement will be duly authorized,
         executed and delivered by the Partnership, the Operating Partnership
         and Operating GP and will be a




                                       18
<PAGE>

         valid and legally binding agreement of each of them, enforceable
         against each of them in accordance with its terms;

provided that, with respect to each agreement described in this Section 6(t),
the enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer and similar laws relating to or
affecting creditors' rights generally and by general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law); and provided further, that the indemnity and contribution
provisions contained in any of such agreements may be limited by applicable laws
and public policy. The Partnership Agreement, the Martin LLC Agreement, the
Operating GP Agreement, the Operating Partnership Agreement, the General Partner
LLC Agreement, the Transaction Documents, the Omnibus Agreement, the Motor
Carrier Agreement, the Product Supply Agreement, the Marine Fuel Agreement, the
Product Storage Agreement, the Terminal Services Agreement, the Marine
Transportation Agreement, the Throughput Agreement and the MLP Credit Agreement
are herein collectively referred to as the "Operative Agreements."

               (u) Sufficiency of Transferred Assets Under the Transaction
Documents. The Transaction Documents will be legally sufficient to transfer or
convey to the Operating Partnership all properties not already held by it that
are, individually or in the aggregate, required to enable the Operating
Partnership to conduct its operations in all material respects as contemplated
by the Prospectus, subject to the conditions, reservations, encumbrances and
limitations contained in the Transaction Documents, the Permitted Liens and
those set forth in the Prospectus. The Operating Partnership, upon execution and
delivery of the Transaction Documents and the filing of related articles of
merger, certificates of merger and articles of conversion with the applicable
governmental authorities, will succeed in all material respects to the business,
assets, properties, liabilities and operations of the MRMC Business, except as
disclosed in the Prospectus and the Transaction Documents.

               (v) Legal Proceedings. There are no legal or governmental
proceedings pending or, to the best knowledge of the Martin Parties, threatened,
against any of the Martin Parties or CFMSLP or to which any of the Martin
Parties or CFMSLP any of their respective properties are subject, that are
required to be described in the Registration Statement or the Prospectus (or any
amendment or supplement thereto) but are not described as required. Except as
described in the Prospectus, there is no action, suit, inquiry, proceeding or
investigation by or before any court or governmental or other regulatory or
administrative agency or commission pending or, to the best knowledge of the
Martin Parties, threatened, against or involving any of the Martin Parties or
CFMSLP, or to which any of their properties are subject, which might
individually or in the aggregate prevent or adversely affect the transactions
contemplated by this Agreement or result in a Material Adverse Effect.

               (w) Contracts. There are no agreements, contracts, indentures,
leases or other instruments that are required to be described in the
Registration Statement or the Prospectus (or any amendment or supplement
thereto) or to be filed as an exhibit to the Registration Statement that are not
described, filed or incorporated by reference in the Registration Statement and
the Prospectus as required by the Act.




                                       19
<PAGE>

               (x) No Default. None of the Martin Parties or CFMSLP is (i) in
violation of (A) its certificate or agreement of limited partnership, limited
liability company agreement, certificate or articles of incorporation or bylaws,
or other organizational documents, (B) any law, statute, ordinance,
administrative or governmental rule or regulation applicable to it, the
violation of which would have a Material Adverse Effect or could materially
impair the ability of any of the Martin Parties to perform their obligations
under this Agreement or the Operative Agreements, or (C) any judgment, decree or
injunction of any court or governmental agency or body having jurisdiction over
it, the violation of which would have a Material Adverse Effect or could
materially impair the ability of any of the Martin Parties to perform their
obligations under this Agreement or the Operative Agreements; or (ii) in breach
or default in any material respect in the performance of any obligation,
agreement or condition contained in (A) any bond, debenture, note or any other
evidence of indebtedness or (B) any agreement, contract, indenture, lease or
other document or instrument (each of (A) and (B), an "Existing Instrument") to
which it is a party or by which any of its properties may be bound, which breach
or default would have a Material Adverse Effect or could materially impair the
ability of any of the Martin Parties to perform their obligations under this
Agreement or the Operative Agreements. To the knowledge of the Martin Parties,
no third party to any Existing Instrument is in default under any such Existing
Instrument, which default would, if continued, have a Material Adverse Effect.

               (y) No Consents or Conflicts. None of the offering, issuance and
sale of the Units by the Partnership, the execution, delivery or performance of
this Agreement or the Operative Agreements by the Martin Parties that are
parties hereto or thereto, or the consummation of the transactions contemplated
hereby and thereby (including the Transactions) (i) requires any consent,
approval, authorization or other order of or registration, qualification or
filing with, any court, regulatory body, administrative agency or other
governmental body, agency or official (except (a) such as may be required for
the registration of the Units under the Act, the inclusion of the Units on the
NASDAQ National Market, the registration of the Common Units under the
Securities Exchange Act of 1934 and the rules and regulations of the Commission
thereunder (collectively, the "Exchange Act") and compliance with the securities
or Blue Sky laws of various jurisdictions, all of which will be, or have been,
effected in accordance with this Agreement and except for the NASD's clearance
of the underwriting terms of the offering contemplated hereby as required under
the NASD's Rules of Fair Practice, (b) as contemplated by the Contribution
Agreement, (c) as disclosed in the Registration Statement, (d) the consent
required under the lease with the Tampa Port Authority filed as an exhibit to
the Registration Statement, (e) any maritime consents, applications and/or
filings made in connection with the transfer of vessels to the Partnership
Entities, (f) filings with applicable secretaries of state to effect any
conversions or mergers contemplated by the Contribution Agreement, and (g) lien
filings and lien releases necessary in connection with the MLP Credit
Agreement), (ii) conflicts with or will conflict with or constitutes or will
constitute a breach or violation of, or a default under, the certificate or
agreement of limited partnership, limited liability company agreement,
certificate or articles of incorporation or bylaws or other organizational
documents of any of the Martin Parties or CFMSLP (assuming all required consents
are received from CF Industries, Inc. in regard to the organizational documents
of CFMSLP), (iii) conflicts with or will conflict with or constitute or will
constitute a breach or violation of, or a default under, any Existing Instrument
to which any of the Martin Parties or CFMSLP is a party or by which any of their
respective properties may be bound (assuming all required consents and/or
approvals are received from the lenders referenced in the "Use of




                                       20
<PAGE>

Proceeds" section of the Prospectus and in connection with the MRMC Credit
Agreement and the Tampa Port Authority), (iv) violates or will violate any
statute, law, regulation, ruling, filing, judgment, injunction, order or decree
applicable to any of the Martin Parties or any of their properties, or (v)
results in or will result in the creation or imposition of any lien,
encumbrance, security interest, equity, charge or claim upon any property or
assets of any of the Martin Parties or CFMSLP (other than the Permitted Liens,
applicable securities laws and any restrictions set forth in the governing
documents of the Partnership Entities) pursuant to, or requires the consent of
any other party to, any Existing Instrument (except as noted above), except in
case of (i), (iii), (iv) or (v) above, for such conflicts, breaches, defaults,
liens, encumbrances, security interests, charges or claims that will not,
individually or in the aggregate, result in a Material Adverse Effect.

               (z) Independent Public Accountants. KPMG LLP, the certified
public accountants who have certified the financial statements (including the
related notes thereto and supporting schedules) filed as part of the
Registration Statement and the Prospectus (or any amendment or supplement
thereto), are independent public accountants as required by the Act.

               (aa) Capitalization; Financial Statements. On June 30, 2002, the
Partnership would have had, on the consolidated pro forma basis indicated in the
Prospectus (and any amendment or supplement thereto), a capitalization as set
forth therein. The historical financial statements, together with related
schedules and notes, included in the Registration Statement and the Prospectus
(and any amendment or supplement thereto), present fairly in all material
respects the financial condition, results of operations, cash flows and changes
in financial position of the entities purported to be shown thereby on the basis
stated in the Registration Statement at the respective dates or for the
respective periods to which they apply; such statements and related schedules
and notes have been prepared in accordance with generally accepted accounting
principles consistently applied throughout the periods involved, except as
disclosed therein. The selected historical and pro forma financial information
set forth in the Registration Statement, the Preliminary Prospectus, and the
Prospectus (and any amendment or supplement thereto) under the caption "Selected
Historical and Pro Forma Financial and Operating Data" is accurately presented
in all material respects and prepared on a basis consistent with the audited and
unaudited historical consolidated financial statements and pro forma financial
statements from which it has been derived. The pro forma financial statements of
the Partnership included in the Registration Statement, the Preliminary
Prospectus and the Prospectus (and any amendment or supplement thereto) have
been prepared in all material respects in accordance with the applicable
accounting requirements of Article 11 of Regulation S-X of the Commission; the
assumptions used in the preparation of such pro forma financial statements are,
in the opinion of the management of the Martin Parties, reasonable; and the pro
forma adjustments reflected in such pro forma financial statements have been
properly applied to the historical amounts in compilation of such pro forma
financial statements. No other financial statements or schedules are required to
be included in the Registration Statement.

               (bb) No Material Adverse Change. Except as disclosed in the
Registration Statement and the Prospectus (or any amendment or supplement
thereto), subsequent to the respective dates as of which such information is
given in the Registration Statement and the Prospectus (or any amendment or
supplement thereto), (i) none of the Partnership Entities or CFMSLP has incurred
any material liabilities or obligations, indirect, direct or contingent, or




                                       21
<PAGE>

entered into any transaction that is not in the ordinary course of business,
(ii) none of the Partnership Entities or CFMSLP has sustained any material loss
or interference with its business or properties from fire, flood, windstorm,
accident or other calamity, whether or not covered by insurance, (iii) none of
the Partnership Entities or CFMSLP is in default under the terms of outstanding
debt obligations, (iv) there has not been any change in the capitalization or
any material change in the indebtedness of any of the Partnership Entities or
CFMSLP (other than in the ordinary course of business) and (v) there has not
been any material adverse change, or any development involving or that may
reasonably be expected to result in a Material Adverse Effect, in the condition
(financial or otherwise), business, prospects, properties, net worth or result
of operations of the Partnership Entities or CFMSLP taken as a whole.

               (cc) Prior Sales of Securities. All offers and sales of
securities of Marine, Resources, MLP Gas or any of the Partnership Entities
prior to the date hereof were made in compliance with or were the subject of an
available exemption from the Act and all other applicable state and federal laws
or regulations.

               (dd) NASDAQ Listing. The Units have been approved for inclusion
on the NASDAQ National Market under the symbol "MMLP," subject to official
notice of issuance of the Units being sold by the Partnership, and upon
consummation of the offering contemplated hereby the Partnership will be in
compliance with the designation and maintenance criteria applicable to NASDAQ
National Market issuers.

               (ee) No Other Offering Material. None of the Martin Parties has
distributed and will not distribute, and has not authorized the Underwriters to
distribute, any offering material in connection with the offering and sale of
the Units other than the Preliminary Prospectus, the Prospectus or other
offering material, if any, as permitted by the Act.

               (ff) No Stabilization or Manipulation. Other than excepted
activity pursuant to Regulation M under the Exchange Act, none of the Martin
Parties has taken and will not take, directly or indirectly, any action that
constituted, or any action designed to, or that might reasonably be expected to
cause or result in or constitute, under the Act or otherwise, stabilization or
manipulation of the price of any security of the Partnership to facilitate the
sale or resale of the Units or for any other purpose.

               (gg) Taxes. At each Closing Date, each of the Martin Parties and
CFMSLP will have filed all tax returns required to be filed, which returns will
be complete and correct in all material respects, and no Martin Party will be in
default in the payment of any taxes that are payable pursuant to such returns or
any assessments with respect thereto.

               (hh) Transactions with Affiliates. Except as set forth in the
Prospectus, there are no transactions with "affiliates" (as defined in Rule 405
promulgated under the Act) or any officer, director or security holder of the
Martin Parties or CFMSLP (whether or not an affiliate) that are required by the
Act to be disclosed in the Registration Statement. Additionally, no
relationship, direct or indirect, exists between the Martin Parties, CFMSLP or
any of their subsidiaries on the one hand, and the directors, officers,
stockholders, customers or suppliers of the Martin Parties, CFMSLP or any of
their subsidiaries on the other hand that is required by the Act to be disclosed
in the Registration Statement and the Prospectus that is not so disclosed.





                                       22
<PAGE>
               (ii) Investment Company Act; Public Utility Holding Company Act.
None of the Martin Parties or CFMSLP is now, and after the sale of the Units to
be sold by the Partnership hereunder and application of the net proceeds from
such sale as described in the Prospectus under the caption "Use of Proceeds"
none of them will be, (i) an "investment company" or an "affiliated person" of,
or "promoter" or "principal underwriter" for, an investment company within the
meaning of the Investment Company Act of 1940, as amended, or (ii) a "public
utility company," "holding company" or a "subsidiary company" of a "holding
company" or an "affiliate" thereof, under the Public Utility Holding Company Act
of 1935, as amended.

               (jj) Title to Properties. Each of the Partnership Entities and
CFMSLP has, or at each Closing Date will have, good and valid title to all
property (real and personal) described in the Prospectus as being owned by it,
free and clear of all liens, claims, security interests or other encumbrances
except (i) such as are described in the Prospectus, (ii) Permitted Liens, (iii)
liens, encumbrances and/or security interests affecting the property of CFMSLP
as a result of CFMSLP's credit facility, (iv) applicable securities laws, (v)
restrictions set forth in the governing documents of the Partnership Entities or
(vi) such as are not materially burdensome and do not have or will not result in
a Material Adverse Effect. All property (real and personal) held under lease by
the Partnership Entities or CFMSLP is held by them under valid, enforceable
leases with only such exceptions as in the aggregate are not materially
burdensome and do not have or result in a Material Adverse Effect.

               (kk) Permits. Each of the Partnership Entities and CFMSLP has, or
at each Closing Date will have, all permits, licenses, franchises, approvals,
consents and authorizations of governmental or regulatory authorities
(hereinafter "permit" or "permits") as are necessary to own its properties and
to conduct its business in the manner described in the Prospectus, subject to
such qualifications as may be set forth in the Prospectus, except where the
failure to have obtained any such permit has not had and will not have a
Material Adverse Effect.

               (ll) Internal Controls. The Partnership Entities and CFMSLP
maintain a system of internal accounting controls sufficient to provide
reasonable assurances that (i) transactions are executed in accordance with
management's general or specific authorizations, (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain accountability for
assets, (iii) access to assets is permitted only in accordance with management's
general or specific authorizations and (iv) the recorded amount of assets is
compared with existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.

               (mm) Environmental Compliance. Except as described in the
Prospectus, the Martin Parties (i) are in compliance with any and all applicable
federal, state, local and foreign laws and regulations relating to the
protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants ("Environmental Laws"), (ii)
have received all permits, licenses or other approvals required of them under
applicable Environmental Laws to conduct their respective businesses and (iii)
are in compliance with all terms and conditions of any such permit, license or
approval, except where such noncompliance with Environmental Laws, failure to
receive required permits, licenses or other approvals or failure to comply with
the terms and conditions of such permits, licenses or other approvals




                                       23
<PAGE>
would not, individually or in the aggregate, have a Material Adverse Effect.
None of the Martin Parties has been named as a "potentially responsible party"
under the Comprehensive Environmental Response Compensation and Liability Act of
1980, as amended, in regard to any unresolved matter or claim. None of the
Martin Parties owns, leases or occupies any property requiring remediation that
appears on any list of hazardous sites compiled by any state or local
governmental agency. In the ordinary course of its business, each of the Martin
Parties conducts a periodic review of the effect of Environmental Laws on its
business, operations and properties, in the course of which it identifies and
evaluates associated costs and liabilities (including any capital or operating
expenditures required for clean-up, closure of properties or compliance with
Environmental Laws or any permit, license or approval,


any related constraints on operating activities and any potential liabilities to
third parties). On the basis of such review and amount of its established
reserves, each of the Martin Parties has reasonably concluded that such
associated costs and liabilities would not, individually or in the aggregate,
result in a Material Adverse Effect.

               (nn) Lock-Up Agreements. The Martin Parties have procured lock-up
agreements, in the form of Exhibit A attached hereto ("Lock-Up Agreements"),
from each of the Martin Parties and the executive officers and directors of the
General Partner.

               (oo) NASD Affiliations. No officer, director, manager or nominee
for any of the foregoing of the Partnership Entities has a direct or indirect
affiliation or association with any member of the NASD.

               (pp) Insurance. Each of the Martin Parties is insured by insurers
of recognized financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in which it is engaged;
and none of the Martin Parties has reason to believe that it will not be able to
renew its existing insurance coverage as and when such coverage expires or to
obtain similar coverage from similar insurers as may be necessary to continue
its business at a comparable cost.

               (qq) ERISA. Except for the Martin Midstream Partners L.P.
Long-Term Incentive Plan (the "Plan"), none of the Partnership Entities is a
party to, or has any liability with respect to, any "employee benefit plan" (as
defined under the Employee Retirement Income Security Act of 1974, as amended,
and the regulations and published interpretations thereunder (collectively,
"ERISA")) established or maintained by them or their "ERISA Affiliates" (as
defined below). "ERISA Affiliate" means, with respect to any Partnership Entity,
any member of any group or organization described in Sections 414(b), (c), (m)
or (o) of the Internal Revenue Code of 1986 (as amended, the "Code") of which
such entity is a member. The Plan is in compliance with ERISA and all other
applicable state and federal laws. No "reportable event" (as defined in ERISA)
has occurred with respect to the Plan. The Plan, if it were to be terminated as
of the Closing Date, would not have any "amount of unfunded benefit liabilities"
(as defined in ERISA). No Partnership Entity nor any of their ERISA Affiliates
has incurred or reasonably expects to incur any liability under (i) Title IV of
ERISA with respect to termination of, or withdrawal from, the Plan or (ii)
Sections 412, 4971, 4975 or 4980B of the Code. Each "employee benefit plan"
established or maintained by any Partnership Entity or any of their ERISA
Affiliates that is intended to be qualified under Section 401(a) of the Code is
so qualified





                                       24
<PAGE>
and nothing has occurred, whether by action or failure to act, that would cause
the loss of such qualification.

               (rr) Forecast. The financial forecast of combined statements of
operations of the Partnership for the 12 months ending September 30, 2003, the
notes thereto and the financial forecast of available cash from operating
surplus based on such financial forecast that are included in Appendix E to the
Registration Statement and the Prospectus were made with a reasonable basis in
good faith. All significant assumptions used in the preparation of such
financial forecast are accurately disclosed in the Registration Statement and
the Prospectus, and such assumptions are, in the opinion of management of the
Partnership, reasonable. The calculation of available cash from operating
surplus was derived from such financial forecast on a basis consistent with the
terms of the Partnership Agreement. Each of the other statements made by the
Partnership in the Registration Statement and the Prospectus within the coverage
of Rule 175(b) under the Act, including (but not limited to) any statements with
respect to future available cash or future cash distributions of the Partnership
or the anticipated ratio of taxable income to cash distributions, was made with
a reasonable basis and in good faith.

               (ss) Private Placement. The offer, sale and issuance of the
Sponsor Units and the Incentive Distribution Rights to the General Partner
pursuant to the Partnership Agreement are exempt from the registration
requirements of the Act and the securities laws of any state having jurisdiction
with respect thereto, and none of the Martin Parties has taken or will take any
action that would cause the loss of such exemption.

               (tt) Directed Unit Sales. None of the Directed Units distributed
in connection with the Directed Unit Program will be offered or sold outside of
the United States.

         7. Expenses. Whether or not the transactions contemplated hereby are
consummated or this Agreement becomes effective or is terminated, the Martin
Parties agree to pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Martin Parties' counsel and accountants in
connection with the registration of the Units under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement and the Prospectus and amendments and supplements thereto
and the mailing and delivering of copies thereof and of any Preliminary
Prospectus to the Underwriters and dealers; (ii) the printing and delivery
(including postage, air freight charges and charges for counting and packaging)
of such copies of the Registration Statement, the Prospectus, each Preliminary
Prospectus, and all amendments or supplements to any of them as may be
reasonably requested for use in connection with the offering and sale of the
Units; (iii) consistent with the provisions of Section 5(f), all expenses in
connection with the qualification of the Units for offering and sale under state
securities laws or Blue Sky laws, including reasonable attorneys' fees and
out-of-pocket expenses of the counsel for the Underwriters in connection
therewith; (iv) the filing fees incident to securing any required review by the
NASD of the fairness of the terms of the sale of the Units and the reasonable
fees and disbursements of the Underwriters' counsel relating thereto; (v) the
fees and expenses associated with including the Units on the NASDAQ National
Market; (vi) the cost of preparing certificates representing the Units; (vii)
the costs and charges of any transfer agent or registrar; (viii) the cost of the
tax stamps, if any, in connection with the issuance and delivery of the Units to
the respective Underwriters; (ix) expenses incurred by the Underwriters in
connection with the Directed Unit Program, including counsel fees related
directly to the



                                       25
<PAGE>

Directed Unit Program and any stamp duties or other taxes incurred by the
Underwriters in connection with the Directed Unit Program; (x) all other fees,
costs and expenses referred to in Item 13 of the Registration Statement; and
(xi) the transportation, lodging, graphics and other expenses incidental to the
Partnership's preparation for and participation in the "roadshow" for the
offering contemplated hereby. Except as provided in this Section 7 and in
Section 8 hereof, the Underwriters shall pay their own expenses, including the
fees and disbursements of their counsel. In addition, in the event that the
proposed offering is terminated for the reasons set forth in Section 5(i)
hereof, the Partnership agrees to reimburse the Underwriters as provided in
Section 5(i).

         8. Indemnification and Contribution. (a) Subject to the limitations in
this paragraph below, the Martin Parties agree, jointly and severally, to
indemnify and hold harmless you and each other Underwriter, the directors,
officers, employees and agents of each Underwriter, and each person, if any, who
controls any Underwriter within the meaning of Section 15 of the Act or Section
20 of the Exchange Act from and against any and all losses, claims, damages,
liabilities and expenses, including reasonable costs of investigation and
attorneys' fees and expenses (collectively, "Damages") arising out of or based
upon any untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus or in the Registration Statement or the
Prospectus or in any amendment or supplement thereto, or any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein (in the case of the Prospectus, in
light of the circumstances under which they were made) not misleading, except:

               (i) to the extent that any such Damages arise out of or are based
upon an untrue statement or omission or alleged untrue statement or omission
that has been made therein or omitted therefrom in reliance upon and in
conformity with the information furnished in writing to the Partnership by or on
behalf of any Underwriter through you, expressly for use in connection
therewith, which information consists solely of the information specified in
Section 14 hereof; or

               (ii) with respect to any Preliminary Prospectus, the foregoing
indemnity in this Section 8(a) shall not inure to the benefit of any Underwriter
(or any of its directors, officers or employees or any person controlling such
Underwriter) if copies of the Prospectus were timely delivered to the
Underwriter and a copy of the Prospectus (as then amended or supplemented if the
Partnership shall have furnished any amendments or supplements thereto) was not
sent or given by or on behalf of such Underwriter to the person claiming
Damages, if required by law so to have been delivered, at or prior to the
written confirmation of the sale of the Units to such person, and if the
Prospectus (as so amended or supplemented) would have cured the defect giving
rise to such Damages.

This indemnification shall be in addition to any liability that the Martin
Parties may otherwise have.

         In addition to their other obligations under this Section 8, the Martin
Parties agree that, as an interim measure during the pendency of any claim,
action, investigation, inquiry or other proceeding arising out of or based upon
any statement or omission, or any inaccuracy in the representations and
warranties of the Martin Parties herein or failure to perform their respective




                                       26
<PAGE>

obligations hereunder, all as set forth in this Section 8, the party against
whom indemnification is being sought will reimburse, in accordance with the
provisions of Section 8(c), each Underwriter and each director, officer,
employee, agent or controlling person thereof on a monthly basis for all
reasonable legal or other out-of-pocket expenses incurred in connection with
investigating or defending any such claim, action, investigation, inquiry or
other proceeding (to the extent documented by reasonably itemized invoices
therefor), notwithstanding the absence of a judicial determination as to the
propriety and enforceability of the obligation of the Martin Parties to
reimburse each Underwriter and each director, officer, employee, agent or
controlling person thereof for such expenses and the possibility that such
payments might later be held to have been improper by a court of competent
jurisdiction. To the extent that any such interim reimbursement payment is so
held to have been improper, each Underwriter and each director, officer,
employee, agent or controlling person thereof shall promptly return it to the
person(s) from whom it was received. Any such interim reimbursement payments
that are not made to the Underwriters or directors, officers, employees, agents
or controlling persons thereof within 30 days of a request for reimbursement
shall bear interest compounded daily at a rate determined on the basis of the
base lending rate announced from time to time by The Wall Street Journal from
the date of such request.

         In connection with the offer and sale of the Directed Units, the Martin
Parties, jointly and severally, agree, promptly upon a request in writing, to
indemnify and hold harmless the Underwriters and the directors, officers,
employees, agents and controlling persons thereof from and against any Damages
which (i) arise out of, or are based upon, any untrue statement or alleged
untrue statement of a material fact contained in any material prepared by or
with the approval of the Martin Parties for distribution to Directed Unit
Participants in connection with the Directed Unit Program or any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, (ii) arises out of
the failure of any Directed Unit Participant to pay for and accept delivery of
Directed Units that the Directed Unit Participant agreed to purchase or (iii) is
otherwise related to the Directed Unit Program, other than Damages that are:

               (x) finally judicially determined to have resulted directly from
the materials prepared by the Underwriters in connection with the Directed Unit
Program or from the bad faith, gross negligence or willful misconduct of the
Underwriters, or

               (y) the result of the failure of the Underwriters to deliver
copies of the Prospectus (including any amended or supplemented Prospectus if
the Partnership shall have timely furnished any amendments or supplements
thereto) to the person claiming Damages, if such delivery was required by law,
at or prior to the written confirmation of the sale of the Units to such person,
and if the Prospectus (as so amended or supplemented) would have cured the
defect giving rise to such Damages.

               (b) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Martin Parties and their respective directors
and officers who sign the Registration Statement and any person who controls the
Martin Parties within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, to the same extent as the foregoing several indemnity from the
Martin Parties to each Underwriter and the directors, officers, employees,
agents and controlling persons thereof, but only with respect to information
furnished in writing by or on




                                       27
<PAGE>

behalf of such Underwriter through you expressly for use in the Registration
Statement, the Prospectus or any Preliminary Prospectus, or any amendment or
supplement thereto.

               In addition to their other obligations under this Section 8, the
Underwriters agree, that, as an interim measure during the pendency of any
claim, action, investigation, inquiry or other proceeding arising out of failure
to perform their obligations hereunder, all as set forth in this Section 8, the
party against whom indemnification is being sought will reimburse in accordance
with the provisions of Section 8(c), each Martin Party and each director,
officer, employee, agent or controlling person thereof on a monthly basis for
all reasonable legal or other out-of-pocket expenses incurred in connection with
investigating or defending any such claim, action, investigation, inquiry or
other proceeding (to the extent documented by reasonably itemized invoices
therefor), notwithstanding the absence of a judicial determination as to the
propriety and enforceability of the obligation of the Underwriters to reimburse
each Martin Party and each director, officer, employee, agent or controlling
person thereof for such expenses and the possibility that such payments might
later be held to have been improper by a court of competent jurisdiction. To the
extent that any such interim reimbursement payment is so held to have been
improper, each Martin Party and each director, officer, employee, agent or
controlling person thereof shall promptly return it to the person(s) from whom
it was received. Any such interim reimbursement payments that are not made to
the Martin Parties or directors, officers, employees, agents or controlling
persons thereof within 30 days of a request for reimbursement shall bear
interest compounded daily at a rate determined on the basis of the base lending
rate announced from time to time by The Wall Street Journal from the date of
such request.

               (c) Promptly after receipt by an indemnified party under this
Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 8 except to the extent it has
been materially prejudiced by such failure and, provided further, that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under this Section 8.
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly with
any other similarly notified indemnifying party, to assume the defense thereof
with counsel reasonably satisfactory to the indemnified party. After notice from
the indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
the Representatives shall have the right to employ counsel to represent jointly
the Representatives and those other Underwriters and their respective directors,
officers, employees, agents and controlling persons who may be subject to
liability arising out of any claim or action in respect of which indemnity may
be sought by the Underwriters against the Martin Parties under this Section 8
if, in the reasonable judgment of the Representatives, it is advisable for the
Representatives and those Underwriters, officers, employees and controlling
persons to be jointly represented by separate counsel, and in that event fees
and expenses of one such separate counsel (plus one local counsel if necessary
in the





                                       28
<PAGE>

opinion of counsel to the indemnified party) shall be paid by the Martin
Parties. No indemnifying party shall (i) without the prior written consent of
the indemnified parties (which consent shall not be unreasonably withheld),
settle or compromise or consent to the entry of any judgment with respect to any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each indemnified party from all liability arising out of such claim, action,
suit or proceeding, or (ii) be liable for any settlement of any such action
effected without its written consent (which consent shall not be unreasonably
withheld), but if settled with the consent of the indemnifying party or if there
be a final judgment of the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and against any
loss or liability by reason of such settlement or judgment.

               (d) If the indemnification provided for in this Section 8 is
unavailable or insufficient for any reason whatsoever to hold harmless an
indemnified party in respect of any Damages referred to herein, then an
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such Damages (i) in such proportion as is appropriate to reflect the relative
benefits received by the Martin Parties on the one hand, and the Underwriters on
the other hand, from the offering and sale of the Units or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative and several fault of the
Martin Parties on the one hand, and the Underwriters on the other hand, in
connection with the statements or omissions that resulted in such Damages as
well as any other relevant equitable considerations. The relative and several
benefits received by the Martin Parties on the one hand, and the Underwriters on
the other hand, shall be deemed to be in the same proportion as the total net
proceeds from the offering (before deducting expenses) received by the
Partnership bear to the total underwriting discounts and commissions received by
the Underwriters, in each case as set forth in the table on the cover page of
the Prospectus. The relative fault of the Martin Parties on the one hand, and
the Underwriters on the other hand, shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Martin Parties on the one hand, or by the
Underwriters on the other hand and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.

         The Martin Parties and the Underwriters agree that it would not be just
and equitable if contribution pursuant to this Section 8 was determined by a pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the Damages
referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Section 8, no Underwriter shall be required to contribute any amount in excess
of the amount of the underwriting commissions received by such




                                       29
<PAGE>

underwriter in connection with the Units underwritten by it and distributed to
the public. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Underwriters'
obligations to contribute pursuant to this Section 8 are several in proportion
to the respective numbers of Firm Units set forth opposite their names in
Schedule I hereto (or such numbers of Firm Units increased as set forth in
Section 11 hereof) and not joint.

         Any Damages for which an indemnified party is entitled to
indemnification or contribution under this Section 8, in accordance with the
provisions of Section 8(c), shall be paid by the indemnifying party to the
indemnified party as Damages are incurred after receipt of reasonably itemized
invoices therefor. The indemnity, contribution and reimbursement agreements
contained in this Section 8 and the representations and warranties of the Martin
Parties set forth in this Agreement shall remain operative and in full force and
effect, regardless of (i) any investigation made by or on behalf of any
Underwriter or director, officer, employee, agent or controlling person thereof,
the Martin Parties, their respective directors or officers or any person
controlling the Martin Parties, (ii) acceptance of any Units and payment
therefor hereunder and (iii) any termination of this Agreement. A successor to
any Underwriter or director, officer, employee, agent or controlling person
thereof, or to the Martin Parties, their respective directors or officers or any
person controlling the Martin Parties, shall be entitled to the benefits of the
indemnity, contribution and reimbursement agreements contained in this Section
8.

               (e) It is agreed that any controversy arising out of the
operation of the interim reimbursement arrangements set forth in the second
paragraph of Section 8(a) or the second paragraph of Section 8(b), including the
amounts of any requested reimbursement payments and the method of determining
such amounts, shall be settled by arbitration conducted pursuant to the Code of
Arbitration Procedure of the NASD. Any such arbitration must be commenced by
service of a written demand for arbitration or written notice of intention to
arbitrate, therein electing the arbitration tribunal. In the event the party
demanding arbitration does not make such designation of an arbitration tribunal
in such demand or notice, then the party responding to said demand or notice is
authorized to do so. Such an arbitration would be limited to the operation of
the interim reimbursement provisions contained in the second paragraph of this
Section 8, and would not resolve the ultimate propriety or enforceability of the
obligation to reimburse expenses that is created by the provisions of the first
paragraph of this Section 8.

         9. Conditions of Underwriters' Obligations. The several obligations of
the Underwriters to purchase the Firm Units hereunder are subject to the
following conditions:

               (a) The Registration Statement shall have become effective not
later than 12:00 noon, New York City time, on the date hereof, or at such later
date and time as shall be consented to in writing by the Representatives, and
all filings required by Rules 424(b), 430A and 462 under the Act shall have been
timely made.

               (b) You shall be reasonably satisfied that since the respective
dates as of which information is given in the Registration Statement and
Prospectus, (i) there shall not have been any change in the capitalization or
any material change in the indebtedness (other than in




                                       30
<PAGE>

the ordinary course of business) of the Partnership Entities, (ii) except as set
forth or contemplated by the Registration Statement or the Prospectus, no
material oral or written agreement or other transaction shall have been entered
into by the Partnership Entities that is not in the ordinary course of business
or that could reasonably be expected to result in a material reduction in the
future earnings of the Partnership Entities, (iii) no loss or damage (whether or
not insured) to the property of the Partnership Entities shall have been
sustained that had or could reasonably be expected to have a Material Adverse
Effect, (iv) no legal or governmental action, suit or proceeding affecting the
Partnership Entities or any of their properties, or that affects or could
reasonably be expected to affect the transactions contemplated by this
Agreement, shall have been instituted or threatened and that would reasonably be
expected to result in a Material Adverse Effect and (v) there shall not have
been any material change in the condition (financial or otherwise), business,
prospects, properties, net worth or results of operations of the Partnership
Entities that makes it impractical or inadvisable in your judgment to proceed
with the public offering or purchase of the Units as contemplated hereby.

               (c) You shall have received on the Closing Date (and the
Additional Closing Date, if any) a written opinion of Baker Botts L.L.P.,
counsel to the Martin Parties, substantially to the effect that:

                  (i) Each of the Partnership and the Operating Partnership has
         been duly formed and is validly existing in good standing as a limited
         partnership under the Delaware LP Act with all necessary limited
         partnership power and authority to own or lease its properties, to
         assume the liabilities being assumed by it pursuant to the Transaction
         Documents and to conduct its business as presently conducted and as
         described in the Registration Statement and the Prospectus, in each
         case in all material respects. Each of the Partnership and the
         Operating Partnership has been duly registered or qualified as a
         foreign limited partnership for the transaction of business under the
         laws of each jurisdiction in which the character of the business
         conducted by it or the nature or location of the properties owned or
         leased by it makes such registration or qualification necessary, except
         where the failure to so register or qualify does not have a Material
         Adverse Effect.

                  (ii) Each of Martin LLC, the General Partner and Operating GP
         has been duly formed and is validly existing in good standing as a
         limited liability company under the Delaware LLC Act with all necessary
         limited liability company power and authority to own or lease its
         properties, to assume the liabilities being assumed by it pursuant to
         the Transaction Documents and to conduct its business as presently
         conducted and as described in the Registration Statement and the
         Prospectus, in each case in all material respects. The General Partner
         has all necessary limited liability company power and authority to act
         as general partner of the Partnership. Operating GP has all necessary
         limited liability company power and authority to act as general partner
         of the Operating Partnership. Each of Martin LLC, the General Partner
         and Operating GP has been duly registered or qualified as a foreign
         limited liability company for the transaction of business under the
         laws of each jurisdiction in which the character of the business
         conducted by it or the nature or location of the properties owned or
         leased by it makes such registration or qualification necessary, except
         where the failure to so register or qualify does not have a Material
         Adverse Effect.



                                       31
<PAGE>

                  (iii) CFMSLP has been duly formed and is validly existing in
         good standing as a limited partnership under the Delaware LP Act with
         full partnership power and authority to own or lease and operate its
         properties to be owned or leased and operated by it at each Closing
         Date and to conduct its business as presently conducted.

                  (iv) The General Partner is the sole general partner of the
         Partnership with a 2% general partner interest in the Partnership; such
         general partner interest has been duly authorized and validly issued in
         accordance with the Partnership Agreement; and the General Partner owns
         such general partner interest free and clear of all liens,
         encumbrances, security interests, charges or claims (i) in respect of
         which a financing statement under the Uniform Commercial Code of the
         State of Delaware naming the General Partner as debtor is on file in
         the office of the Secretary of State of Delaware or (ii) otherwise
         known to such counsel, without independent investigation, in each case
         other than those created by or arising under the Delaware LP Act,
         Permitted Liens, applicable securities laws and any restrictions set
         forth in the governing documents of the Partnership Entities.

                  (v) The General Partner owns all of the Incentive Distribution
         Rights, MGS owns 1,543,797 Subordinated Units, Midstream owns 620,644
         Subordinated Units and Martin LLC owns 2,088,921 Subordinated Units;
         all of such Common Units, Subordinated Units and the limited partner
         interests represented thereby and the Incentive Distribution Rights
         have been duly authorized and validly issued in accordance with the
         Partnership Agreement, and are fully paid (to the extent required under
         the Partnership Agreement) and nonassessable (except as such
         nonassessability may be affected by matters described in the Prospectus
         under the caption "The Partnership Agreement--Limited Liability"); and
         the General Partner, MGS, Midstream and Martin LLC own their respective
         Subordinated Units and Incentive Distribution Rights free and clear of
         all liens, encumbrances, security interests, charges or claims (i) in
         respect of which a financing statement under the Uniform Commercial
         Code of the State of Delaware naming the General Partner, MGS,
         Midstream or Martin LLC as debtor is on file in the office of the
         Secretary of State of Delaware or (ii) otherwise known to such counsel,
         without independent investigation, in each case other than those
         created by or arising under the Delaware LP Act, Permitted Liens,
         applicable securities laws, any restrictions set forth in the governing
         documents of the Partnership Entities and, with respect to the
         Incentive Distribution Rights, any restrictions on transferability set
         forth in the governing documents of the Partnership Entities.

                  (vi) The Units to be issued and sold to the Underwriters by
         the Partnership pursuant to the Underwriting Agreement and the limited
         partner interests represented thereby have been duly authorized by the
         Partnership Agreement and, when issued and delivered to the
         Underwriters against payment therefore in accordance with the terms of
         the Underwriting Agreement, will be validly issued, fully paid (to the
         extent required under the Partnership Agreement) and nonassessable
         (except as such nonassessability may be affected by matters described
         in the Prospectus under the caption "The Partnership Agreement--Limited
         Liability"); and other than the Sponsor Units and the Incentive
         Distribution Rights, the Units are the only limited partner interests
         of the Partnership issued and outstanding at the Closing Date.




                                       32
<PAGE>

                  (vii) MRMC is the sole member of Martin LLC with a 100% member
         interest in Martin LLC; such member interest has been duly authorized
         and validly issued in accordance with the Martin LLC Agreement and is
         fully paid (to the extent required under the Martin LLC Agreement) and
         nonassessable (except as such nonassessability may be affected by
         Section 18-607 of the Delaware LLC Act); and MRMC owns such member
         interest free and clear of all liens, encumbrances, security interests,
         charges or claims (i) in respect of which a financing statement under
         the Uniform Commercial Code of the State of Delaware naming MRMC as
         debtor is on file in the office of the Secretary of State of Delaware
         or (ii) otherwise known to such counsel, without independent
         investigation, in each case other than those created by or arising
         under the Delaware LP Act, Permitted Liens, applicable securities laws
         and any restrictions set forth in the governing documents of the
         Partnership Entities.

                  (viii) The Partnership is the sole member of Operating GP with
         a 100% member interest in Operating GP; such member interest has been
         duly authorized and validly issued in accordance with the Operating GP
         Agreement and is fully paid (to the extent required under the Operating
         GP Agreement) and nonassessable (except as such nonassessability may be
         affected by Section 18-607 of the Delaware LLC Act); and the
         Partnership owns such member interest free and clear of all liens,
         encumbrances, security interests, charges or claims (i) in respect of
         which a financing statement under the Uniform Commercial Code of the
         State of Delaware naming the Partnership as debtor is on file in the
         office of the Secretary of State of Delaware or (ii) otherwise known to
         such counsel, without independent investigation, in each case other
         than those created by or arising under the Delaware LP Act, Permitted
         Liens, applicable securities laws and any restrictions set forth in the
         governing documents of the Partnership Entities.

                  (ix) Operating GP is the sole general partner of the Operating
         Partnership with a 0.1% general partner interest in the Operating
         Partnership; such general partner interest has been duly authorized and
         validly issued in accordance with the Operating Partnership Agreement,
         and Operating GP owns such general partner interest free and clear of
         all liens, encumbrances , security interests, charges or claims (i) in
         respect of which a financing statement under the Uniform Commercial
         Code of the State of Delaware naming Operating GP as debtor is on file
         in the office of the Secretary of State of Delaware or (ii) otherwise
         known to such counsel, without independent investigation, in each case
         other than those created by or arising under the Delaware LP Act,
         Permitted Liens, applicable securities laws and any restrictions set
         forth in the governing documents of the Partnership Entities.

                  (x) The Partnership is the sole limited partner of the
         Operating Partnership with a 99.9% limited partner interest in the
         Operating Partnership; such limited partner interest has been duly
         authorized and validly issued in accordance with the Operating
         Partnership Agreement and is fully paid (to the extent required under
         the Operating Partnership Agreement) and nonassessable (except as such
         nonassessability may be affected by Sections 17-303 and 17-607 of the
         Delaware LP Act); and the Partnership owns such limited partner
         interest free and clear of all liens, encumbrances, security interests,
         charges or claims (i) in respect of which a financing statement under
         the Uniform Commercial Code of the State of Delaware naming the
         Partnership as debtor




                                       33
<PAGE>

         is on file in the office of the Secretary of State of Delaware or (ii)
         otherwise known to such counsel, without independent investigation, in
         each case other than those created by or arising under the Delaware LP
         Act, Permitted Liens, applicable securities laws and any restrictions
         set forth in the governing documents of the Partnership Entities.

                  (xi) Martin LLC is the sole member of the General Partner with
         a 100% member interest in the General Partner; such member interest has
         been duly authorized and validly issued in accordance with the General
         Partner LLC Agreement and is fully paid (to the extent required under
         the General Partner LLC Agreement) and nonassessable (except as such
         nonassessability may be affected by Section 18-607 of the Delaware LLC
         Act); and Martin LLC owns such member interest free and clear of all
         liens, encumbrances, security interests, charges or claims (i) in
         respect of which a financing statement under the Uniform Commercial
         Code of the State of Delaware naming Martin LLC as debtor is on file in
         the office of the Secretary of State of Delaware or (ii) otherwise
         known to such counsel, without independent investigation, in each case
         other than those created by or arising under the Delaware LP Act,
         Permitted Liens, applicable securities laws and any restrictions set
         forth in the governing documents of the Partnership Entities.

                  (xii) At the Closing Date, each of MGM and the Operating
         Partnership will be a limited partner of CFMSLP with an aggregate 49.5%
         limited partner interest in CFMSLP; such limited partner interests have
         been duly authorized and validly issued in accordance with the
         partnership agreement, as amended, of CFMSLP and are fully paid (to the
         extent required under the partnership agreement, as amended, of CFMSLP)
         and nonassessable (except as such nonassessability may be affected by
         Sections 17-303 and 17-607 of the Delaware LP Act); and each of MGM and
         the Operating Partnership will own such limited partner interests free
         and clear of all liens, encumbrances, security interests, charges or
         claims (i) in respect of which a financing statement under the Uniform
         Commercial Code of the State of Delaware naming MGM or the Operating
         Partnership as debtor is on file in the office of the Secretary of
         State of Delaware or (ii) otherwise known to such counsel, without
         independent investigation, in each case other than those created by or
         arising under the Delaware LP Act, applicable securities laws, any
         restrictions set forth in the governing documents of the Partnership
         Entities, and any transfer restrictions and buy/sell obligations
         contained in the governing documents of CFMSLP or its general partner.

                  (xiii) Except as described in the Prospectus, there are no
         preemptive rights or other rights to subscribe for or to purchase, nor
         any restriction upon the voting or transfer of, any partnership or
         member interests in the Partnership Entities, in each case pursuant to
         the organizational documents or any agreement or other instrument
         listed as an exhibit to the Registration Statement to which any
         Partnership Entity is a party or by which any of them may be bound. To
         such counsel's knowledge, neither the filing of the Registration
         Statement nor the offering or sale of the Units as contemplated by this
         Agreement gives rise to any rights for or relating to the registration
         of any Units or other securities of any Partnership Entity, other than
         as described in the Prospectus and the Partnership Agreement or as have
         been waived. To such counsel's knowledge, except as




                                       34
<PAGE>

         described in the Prospectus, there are no outstanding options or
         warrants to purchase partnership or member interests in any Partnership
         Entity.

                  (xiv) The Partnership has all necessary limited partnership
         power and authority to issue, sell and deliver (i) the Units, in
         accordance with and upon the terms and conditions set forth in this
         Agreement, the Partnership Agreement, the Registration Statement and
         the Prospectus, and (ii) the Subordinated Units and the Incentive
         Distribution Rights, in accordance with the terms and conditions set
         forth in the Partnership Agreement and the Transaction Documents.

                  (xv) This Agreement has been duly authorized and validly
         executed and delivered by each of the Martin Parties.

                  (xvi) Each of the Operative Agreements to which any of the
         Martin Parties is a party has been duly authorized and validly executed
         and delivered by the Martin Parties that are parties thereto. Assuming
         due authorization, execution and delivery by each party other than a
         Martin Party, each of the Operative Agreements (other than any
         Operative Agreement governed by law other than Texas law) to which any
         of the Martin Parties is a party constitutes a valid and legally
         binding obligation of the Martin Parties that are parties thereto,
         enforceable against each such party in accordance with its terms,
         subject to (i) bankruptcy, insolvency, reorganization, moratorium,
         fraudulent transfer and similar laws relating to or affecting
         creditors' rights generally and by general principles of equity
         (regardless of whether such enforceability is considered in a
         proceeding in equity or at law) and (ii) public policy, applicable law
         relating to fiduciary duties and indemnification and contribution and
         an implied covenant of good faith and fair dealing.

                  (xvii) The Mergers of Resources and MLP Gas with and into the
         Operating Partnership became effective under the Delaware LP Act and
         the Texas Business Corporation Act, as applicable, on November 1, 2002.

                  (xviii) Pursuant to Section 17-211 of the Delaware LP Act,
         upon the effectiveness of the Mergers of Resources and MLP Gas with and
         into the Operating Partnership, for all purposes of the laws of the
         State of Delaware, all of the rights, privileges and powers of
         Resources and MLP Gas, and all property, real, personal and mixed, and
         all debts due to either of Resources and MLP Gas, as well as all other
         things and causes of action belonging to each of Resources and MLP Gas,
         shall be vested in the Operating Partnership, and shall thereafter be
         the property of the Operating Partnership as they were of each of
         Resources and MLP Gas, and the title to any real property vested by
         deed or otherwise, under the laws of the State of Delaware, in either
         of Resources or MLP Gas shall not revert or be in any way impaired by
         reason of Section 17-211 of the Delaware LP Act. Pursuant to Article
         5.06 of the Texas Business Corporation Act, all rights, title and
         interests to all real estate and other property owned by each of
         Resources and MLP Gas shall be allocated to and vested in the Operating
         Partnership without reversion or impairment, without further act or
         deed, and without any transfer or assignment having occurred, but
         subject to any existing liens or other encumbrances thereon.



                                       35
<PAGE>

                  (xix) Each of the Conveyances that purports to transfer right,
         title or interest to property (i) is in a form legally sufficient as
         between the parties thereto to convey to the transferee thereunder all
         of the right, title and interest of the transferor stated therein in
         and to the properties located in the State of Texas and to any vessels
         governed by the United States regulations relating to the documentation
         of vessels, as described in the Conveyances, subject to the conditions,
         reservations and limitations contained in the Conveyances, except motor
         vehicles or other property requiring conveyances of certificated title
         as to which the Conveyances are legally sufficient to compel delivery
         of such certificated title, (ii) is in a form legally sufficient for
         recordation in the appropriate public offices of the State of Texas or
         in relation to vessels, in the National Vessel Documentation Center of
         the U.S. Coast Guard, in each case to the extent such recordation is
         required, (iii) upon proper recordation of any deeds included in the
         Conveyances relating to real properties located in the State of Texas
         and upon obtaining or making the maritime consents, applications and/or
         filings to be obtained or made in connection with the transfer of
         vessels to the Partnership Entities, will constitute record notice to
         all third parties under the applicable recordation statutes of the
         State of Texas and the United States regulations relating to the
         documentation of vessels concerning record title to the real property
         or vessels, as the case may be, transferred thereby; and (iv)
         recordation in the office of the County Clerk for each county in which
         the Partnership Entities own real property is the appropriate public
         office in the State of Texas for the recordation of deeds and
         assignments of interests in real property located in such county.

                  (xx) Except as described in the Prospectus, to the knowledge
         of such counsel, there is no action, suit, inquiry, proceeding or
         investigation by or before any court or governmental or other
         regulatory or administrative agency or commission pending or
         threatened, against or involving any of the Martin Parties, or to which
         any of the Martin Parties or their properties are subject that are
         required to be described in the Registration Statement or Prospectus
         that are not described as required therein.

                  (xxi) None of the offering, issuance and sale of the Units by
         the Partnership, the execution, delivery or performance of this
         Agreement or the Operative Agreements by the Martin Parties that are
         parties hereto or thereto, or the consummation of the transactions
         contemplated hereby and thereby (including the Transactions) (i)
         conflicts with or will conflict with or constitutes or will constitute
         a breach or violation of, or a default under, the certificate or
         agreement of limited partnership, limited liability company agreement,
         certificate or articles of incorporation or bylaws (or other
         organizational documents) of any of the Martin Parties, (ii)
         constitutes or will constitute a breach or violation of, or a default
         (or an event that, with notice or lapse of time or both, would
         constitute such a default) under, any Operative Agreement or any other
         agreement filed as an exhibit to the Registration Statement, (iii)
         violates or will result in any violation of (assuming compliance with
         all applicable state securities and Blue Sky laws) any applicable
         Delaware, Texas or federal law or regulation, or any ruling, filing,
         judgment, injunction, order or decree of any Delaware, Texas or federal
         court or government agency applicable to the Martin Parties, or (iv)
         results in or will result in the creation or imposition of any lien,
         encumbrance, security interest, charge or claim (other than Permitted
         Liens) upon any property or assets of any of the Partnership Entities,




                                       36
<PAGE>

         which conflicts, breaches, violations, defaults or liens, encumbrances,
         security interests, charges or claims, in the case of clauses (ii),
         (iii) or (iv), would individually or in the aggregate, result in a
         Material Adverse Effect.

                  (xxii) No consent, approval, authorization or other order of,
         or registration, qualification or filing with, any Delaware, Texas or
         federal court, regulatory body, administrative agency or other
         governmental body, agency or official is required on the part of any of
         the Martin Parties for the valid offering, issuance and sale of the
         Units to the Underwriters under this Agreement, the execution, delivery
         and performance of this Agreement or the Operative Agreements by the
         Martin Parties that are parties hereto or thereto or the consummation
         by the Martin Parties of the transactions (including the Transactions)
         contemplated by this Agreement or the Operative Agreements except (i)
         for such consents required under the Act and the Exchange Act or under
         state securities or "Blue Sky" laws, as to which such counsel need to
         express any opinion, (ii) for such consents which have been obtained or
         made, (iii) for such consents which (A) are of a routine or
         administrative nature, (B) are not customarily obtained or made prior
         to the consummation of transactions such as those contemplated by this
         Agreement and the Operative Agreements and (C) are expected in the
         reasonable judgment of the General Partner to be obtained in the
         ordinary course of business subsequent to the consummation of the
         Transactions or (iv) for such consents which, if not obtained or made,
         would not, individually or in the aggregate, have a Material Adverse
         Effect.

                  (xxiii) The Registration Statement has been declared effective
         by the Commission under the Act. To the knowledge of such counsel, no
         stop order suspending the effectiveness of the Registration Statement
         has been issued under the Act and no proceedings for such purpose have
         been instituted or are pending or are contemplated or threatened by the
         Commission. Any required filing of the Prospectus and any supplement
         thereto pursuant to Rule 424(b) under the Act has been made in the
         manner and within the time period required by such Rule 424(b).

                  (xxiv) The Registration Statement, including any Rule 462
         Registration Statement, the Prospectus and each amendment or supplement
         to the Registration Statement and the Prospectus, as of their
         respective effective or issue dates (other than the financial
         statements and the notes and schedules thereto, and the other
         financial, statistical and accounting data included in the Registration
         Statement, Prospectus and in the exhibits to or excluded from the
         Registration Statement, as to which no opinion need be given) comply as
         to form in all material respects with the requirements of the Act.

                  (xxv) None of the Partnership Entities is an "investment
         company", as such term is defined in the Investment Company Act of
         1940, as amended, or a "public utility holding company" or "holding
         company" within the meaning of the Public Utility Holding Company Act
         of 1935, as amended.

                  (xxvi) The opinion of Baker Botts L.L.P. that is filed as
         Exhibit 8.1 to the Registration Statement is confirmed and the
         Underwriters may rely on such opinion as if it were addressed to them.

                                       37

<PAGE>

                  (xxvii) The statements in the Registration Statement and
         Prospectus under the captions "Cash Distribution Policy," "Management's
         Discussion and Analysis of Financial Condition and Results of
         Operations - Description of Our Credit Facility," "Certain
         Relationships and Related Transactions," "Conflicts of Interest and
         Fiduciary Responsibilities," "Description of the Common Units,"
         "Description of the Subordinated Units" and "The Partnership Agreement"
         accurately describe in all material respects the portions of the
         documents addressed thereby and, insofar as they purport to constitute
         summaries of law or legal conclusions, are accurate in all material
         respects; the description of the statutes and regulations set forth in
         the Registration Statement and Prospectus under the caption
         "Business--Environmental and Regulatory Matters" fairly describe in all
         material respects the portions of the statutes and regulations
         addressed thereby; and the Common Units, the Subordinated Units and the
         Incentive Distribution Rights conform in all material respects to the
         descriptions thereof contained in the Registration Statement and
         Prospectus under the captions "Prospectus Summary--The Offering," "Cash
         Distribution Policy," "Description of the Common Units," "Description
         of the Subordinated Units" and "The Partnership Agreement."

                  (xxviii) The offer, sale and issuance of the Sponsor Units and
         the Incentive Distribution Rights to the General Partner or any of the
         Martin Parties pursuant to the Partnership Agreement are exempt from
         the registration requirements of the Act and the securities laws of the
         State of Texas.

         In rendering such opinion, counsel may rely, to the extent they deem
such reliance proper, as to matters of fact upon certificates of officers of the
Martin Parties and of government officials, provided that counsel shall state
their belief that they and you are justified in relying thereon. Copies of all
such certificates shall be furnished to you and your counsel on the Closing Date
and the Additional Closing Date, as the case may be.

         In addition, such counsel shall state that they have participated in
conferences with officers and other representatives of the Martin Parties, the
independent public accountants of the Partnership, and the Underwriters, at
which the contents of the Registration Statement and the Prospectus and related
matters were discussed, and although such counsel has not independently
verified, is not passing on, and is not assuming any responsibility for the
accuracy, completeness or fairness of the statements contained in, the
Registration Statement and the Prospectus (except to the extent specified in the
foregoing opinion), based on the foregoing, no information has come to such
counsel's attention that causes such counsel to believe that the Registration
Statement (other than (i) the financial statements included therein, including
the notes and schedules thereto and the auditors' reports thereon, (ii) the
other financial, statistical and accounting data included therein, and (iii) the
exhibits thereto, as to which such counsel need not comment), as of its
effective date contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, or that the Prospectus (other than (i) the
financial statements included therein, including the notes and schedules thereto
and the auditors' reports thereon, (ii) the other financial, statistical and
accounting data included therein, and (iii) the exhibits thereto, as to which
such counsel need not comment), as of its issue date and the Closing Date
contained or contains an untrue statement of a material fact or omitted or omits
to state a material fact

                                       38

<PAGE>

necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.

                  (d) You shall have received on the Closing Date a written
opinion of each of Trenam, Kemker, Scharf, Barkin, Frye, O'Neill and Mullis,
P.A. and Vickers, Riis, Murray and Curran, L.L.C., counsel to the Martin
Parties, substantially to the effect set forth in Exhibit B attached hereto.

                  (e) You shall have received on the Closing Date a written
opinion of Cook, Yancey, King & Galloway, a Professional Law Corporation,
counsel to the Martin Parties, substantially to the effect set forth in Exhibit
C attached hereto.

                  (f) You shall have received on the Closing Date a written
opinion of Marquis & Aurbach, counsel to the Martin Parties, substantially to
the effect set forth in Exhibit D attached hereto.

                  (g) You shall have received on the Closing Date or Additional
Closing Date, as the case may be, an opinion of Vinson & Elkins L.L.P., as
counsel for the Underwriters, dated the Closing Date or Additional Closing Date,
as the case may be, with respect to the issuance and sale of the Units, the
Registration Statement and other related matters as you may reasonably request,
and the Martin Parties and their counsel shall have furnished to your counsel
such documents as they may reasonably request for the purpose of enabling them
to pass upon such matters.

                  (h) You shall have received letters addressed to you and dated
the date hereof and the Closing Date or the Additional Closing Date, as the case
may be, from the firm of KPMG LLP, independent certified public accountants (i)
confirming that they are independent public accountants within the meaning of
the Act and are in compliance with the applicable requirements relating to the
qualification of accountants under Rule 2-01 of Regulation S-X of the
Commission, and (ii) stating, as of the date thereof (or, with respect to
matters involving changes or developments since the respective dates as of which
specified financial information is given in the Prospectus, as of a date not
more than five days prior to the date thereof), the conclusions and findings of
such firm with respect to the financial information and other matters ordinarily
covered by accountants' "comfort letters" to underwriters in connection with
registered public offerings.

                  (i) All corporate, partnership and limited liability company
proceedings and other legal matters incident to the authorization, form and
validity of this Agreement, the Operative Agreements, the Common Units, the
Subordinated Units, the Incentive Distribution Rights, the Registration
Statement and the Prospectus, and all other legal matters relating to this
Agreement, the transactions contemplated hereby and the Transactions shall be
reasonably satisfactory in all material respects to counsel for the
Underwriters, and the Partnership shall have furnished to such counsel all
documents and information that they may reasonably request to enable them to
pass upon such matters.

                                       39

<PAGE>

                  (j) The MLP Credit Agreement shall have been duly authorized,
executed and delivered by the Partnership, Operating Partnership and Operating
GP and each of the other parties thereto.

                  (k) (i) No stop order suspending the effectiveness of the
Registration Statement shall have been issued by the Commission and no
proceedings for that purpose shall be pending or, to the knowledge of the
Partnership, shall be threatened or contemplated by the Commission at or prior
to the Closing Date or Additional Closing Date, as the case may be; (ii) no
order suspending the effectiveness of the Registration Statement or the
qualification or registration of the Units under the securities or Blue Sky laws
of any jurisdiction shall be in effect and no proceeding for such purpose shall
be pending or, to the knowledge of the Partnership, threatened or contemplated
by the authorities of any jurisdiction; (iii) any request for additional
information on the part of the staff of the Commission or any such authorities
shall have been complied with to the satisfaction of the staff of the Commission
or such authorities; (iv) after the date hereof, no amendment or supplement to
the Registration Statement or the Prospectus shall have been filed unless a copy
thereof was first submitted to you and you did not object thereto in good faith;
and (v) all of the representations and warranties of the Martin Parties
contained in this Agreement shall be true and correct on and as of the date
hereof and on and as of the Closing Date or Additional Closing Date, as the case
may be, as if made on and as of the Closing Date or Additional Closing Date, as
the case may be, and you shall have received a certificate, dated the Closing
Date or the Additional Closing Date, as the case may be, and signed by the chief
executive officer and the chief financial officer of the Partnership (or such
other officers as are acceptable to you) to the effect set forth in this Section
9(k) and in Sections 9(b), 9(l) and 9(q) hereof and that shall set forth a
representation of the Partnership that all of the transactions summarized in the
introductory paragraphs of this Agreement have been completed.

                  (l) The Martin Parties shall not have failed in any material
respect at or prior to the Closing Date or the Additional Closing Date, as the
case may be, to have performed or complied with any of their agreements herein
contained and required to be performed or complied with by them hereunder at or
prior to the Closing Date or Additional Closing Date, as the case may be.

                  (m) The Partnership shall have furnished or caused to have
been furnished to you such further certificates and documents as you shall have
reasonably requested.

                  (n) At or prior to the Closing Date, you shall have received
Lock-Up Agreements from each of the Martin Parties and the directors and
executive officers of the General Partner not to (except as provided in such
Lock-Up Agreement) directly or indirectly (i) sell, offer or contract to sell or
otherwise dispose of or transfer any Common Units, whether now owned or acquired
after the date of the Prospectus or with respect to which the power of
disposition is acquired after the date of the Prospectus, or file any
registration statement under the Act with respect to the foregoing or (ii) enter
into any swap or other agreement that transfers, in whole or in part, directly
or indirectly, the economic consequences of ownership of Common Units whether
any such swap or transaction is to be settled by delivery of Common Units, in
cash or otherwise, before the expiration of 180 days from the Closing Date,
without the prior written consent of Raymond James & Associates, Inc.

                                       40

<PAGE>

                  (o) At or prior to the effective date of the Registration
Statement, you shall have received a letter from the Corporate Financing
Department of the NASD confirming that such Department has determined to raise
no objections with respect to the fairness or reasonableness of the underwriting
terms and arrangements of the offering contemplated hereby.

                  (p) The NASDAQ National Market shall have approved the Units
for inclusion therein, subject only to official notice of issuance, and
satisfactory evidence of such actions shall have been provided to the
Underwriters.

                  (q) The consents, applications, filings and releases set forth
on Schedule 10(q) shall have been obtained or made, except for such consents
(i)(A) which are of a routine or administrative nature, (B) are not customarily
obtained or made prior to the consummation of transactions such as those
contemplated by this Agreement and the Operative Agreements and (C) are expected
in the reasonable judgment of the General Partner to be obtained in the ordinary
course of business subsequent to the consummation of the Transactions or (ii)
which, if not obtained or made, would not, individually or in the aggregate,
have a Material Adverse Affect.

         All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are reasonably satisfactory
in form and substance to you and your counsel. Any representation made in any
certificate executed by an officer of the Partnership shall be deemed to be a
representation of the Partnership.

         The several obligations of the Underwriters to purchase Additional
Units hereunder are subject to the satisfaction on and as of the Additional
Closing Date of the conditions set forth in this Section 9, except that, if the
Additional Closing Date is other than the Closing Date, the certificates,
opinions and letters referred to in this Section 9 shall be dated as of the
Additional Closing Date and the opinions called for by paragraphs (c) and (d)
shall be revised to reflect the sale of Additional Units.

         If any of the conditions hereinabove provided for in this Section 9
shall not have been satisfied when and as required by this Agreement, this
Agreement may be terminated by you by notifying the Partnership of such
termination in writing or by telegram at or prior to such Closing Date, but you
shall be entitled to waive any of such conditions.

         10. Effective Date of Agreement. This Agreement shall become effective
upon the later of (a) the execution and delivery hereof by the parties hereto
and (b) release of notification of the effectiveness of the Registration
Statement by the Commission; provided, however, that the provisions of Sections
7 and 8 shall at all times be effective.

         11. Defaulting Underwriters. If any one or more of the Underwriters
shall fail or refuse to purchase Firm Units that it or they have agreed to
purchase hereunder, and the aggregate number of Firm Units that such defaulting
Underwriter or Underwriters agreed but failed or refused to purchase is not more
than one-tenth of the aggregate number of the Firm Units, each non-defaulting
Underwriter shall be obligated, severally, in the proportion in which the number
of Firm Units set forth opposite its name in Schedule I hereto bears to the
aggregate number of Firm Units set forth opposite the names of all
non-defaulting Underwriters or in such other proportion as you may specify in
the Agreement Among Underwriters, to purchase the

                                       41

<PAGE>

Firm Units that such defaulting Underwriter or Underwriters agreed, but failed
or refused, to purchase. If any Underwriter or Underwriters shall fail or refuse
to purchase Firm Units and the aggregate number of Firm Units with respect to
which such default occurs is more than one-tenth of the aggregate number of Firm
Units and arrangements satisfactory to you and the Partnership for the purchase
of such Firm Units are not made within 48 hours after such default, this
Agreement will terminate without liability on the part of any non-defaulting
Underwriter or the Partnership. In any such case that does not result in
termination of this Agreement, either you or the Partnership shall have the
right to postpone the Closing Date, but in no event for longer than seven days,
in order that the required changes, if any, in the Registration Statement and
the Prospectus or any other documents or arrangements may be effected. Any
action taken under this paragraph shall not relieve any defaulting Underwriter
from liability in respect of any such default of any such Underwriter under this
Agreement.

         12. Termination of Agreement. This Agreement shall be subject to
termination in your absolute discretion, without liability on the part of any
Underwriter to any of the Martin Parties by notice to the Partnership, if prior
to the Closing Date or the Additional Closing Date (if different from the
Closing Date and then only as to the Additional Units), as the case may be, in
your sole judgment, (i) trading in the Partnership's Common Units shall have
been suspended by the Commission or the NASDAQ, (ii) trading in securities
generally on the NYSE or NASDAQ shall have been suspended or materially limited,
or minimum or maximum prices shall have been generally established on such
exchange, or additional material governmental restrictions, not in force on the
date of this Agreement, shall have been imposed upon trading in securities
generally by any such exchange or by order of the Commission or any court or
other governmental authority, (iii) a general moratorium on commercial banking
activities shall have been declared by either federal or New York State
authorities, (iv) there shall have occurred any material disruption in
commercial banking or securities settlement or clearance services, or (v) there
shall have occurred any outbreak or escalation of hostilities or other
international or domestic calamity, crisis or change in political, financial or
economic conditions or other material event the effect of which on the financial
markets of the United States is such as to make it, in your judgment,
impracticable or inadvisable to market the Units or to enforce contracts for the
sale of the Units. Notice of such cancellation shall be promptly given to the
Partnership and its counsel by telegraph, telecopy or telephone and shall be
subsequently confirmed by letter.

         13. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Martin Parties or their respective officers and of the Underwriters set forth in
or made pursuant to this Agreement will remain in full force and effect,
regardless of any investigation made by or on behalf of the Underwriters or the
Martin Parties or any of the officers, directors, employees, agents or
controlling persons referred to in Section 8 hereof, and will survive delivery
of and payment for the Units. The provisions of Sections 7 and 8 hereof shall
survive the termination or cancellation of this Agreement.

         14. Information Furnished by the Underwriters. The Martin Parties
acknowledge that

         (i) the second to the last paragraph of the cover page of the
Prospectus regarding delivery of the Units,

                                       42

<PAGE>

         (ii) the list of the Underwriters and their respective participation in
the sale of the Units, and

         (iii) the statements set forth in the third, eighth, ninth, tenth, and
eighteenth paragraphs, the last sentence of the eleventh paragraph, and the
second sentence of the seventh paragraph, in each case under the caption
"Underwriting" in the Prospectus.

constitute the only information furnished by or on behalf of the Underwriters
through you as such information is referred to in Sections 6.1(a), 6.1(b) and 8
hereof.

         15. Miscellaneous. Except as otherwise provided in Sections 5 and 12
hereof, notice given pursuant to any of the provisions of this Agreement shall
be in writing and shall be delivered:

                  (i)      to the Partnership:

                           Martin Midstream Partners L.P.
                           4200 Stone Road
                           Kilgore, Texas  75662
                           Attention:  Ruben Martin

                           with a copy to:

                           Baker Botts L.L.P.
                           2001 Ross Avenue
                           600 Trammell Crow Center
                           Dallas, Texas  75201
                           Attention:  C. Neel Lemon, III

                  (ii)     to the Underwriters:

                           Raymond James & Associates, Inc.
                           2001 Ross Avenue
                           3550 Trammel Crow Center
                           Dallas, Texas  75201
                           Attention:  Allen D. Lassiter

                           with a copy to:

                           Vinson & Elkins L.L.P.
                           2001 Ross Avenue
                           3700 Trammell Crow Center
                           Dallas, Texas  75201
                           Attention:  Jeffrey A. Chapman

                                       43

<PAGE>

                           and

                           Vinson & Elkins L.L.P.
                           1001 Fannin
                           2300 First City Tower
                           Houston, Texas  77002-6760
                           Attention:  Thomas P. Mason

         This Agreement has been and is made solely for the benefit of the
several Underwriters, the Martin Parties and their respective successors. This
Agreement and the terms and provisions hereof are for the sole benefit of only
those persons, except that (A) the indemnities of the Martin Parties contained
in Section 8 shall also be deemed to be for the benefit of each director,
officer, employee and agent of any Underwriter and any person who controls any
Underwriter within the meaning of Section 15 of the Act and (B) the indemnity
agreement of the Underwriters contained in Section 8 of this Agreement shall be
deemed to be for the benefit of each director of the General Partner, each
officer of the General Partner who has signed the Registration Statement and any
person who controls any of the Martin Parties within the meaning of Section 15
of the Act. Nothing in this Agreement is intended or shall be construed to give
any person, other than the persons referred to in this Section 15, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein.

         16. Applicable Law; Counterparts. This Agreement shall be governed by
and construed in accordance with the laws of the State of Florida without
reference to choice of law principles thereunder.

         This Agreement may be signed in various counterparts, which together
shall constitute one and the same instrument.

         This Agreement shall be effective when, but only when, at least one
counterpart hereof shall have been executed on behalf of each party hereto.

         17. Waiver of Jury Trial. The Partnership and the Underwriters each
hereby irrevocably waive any right they may have to a trial by jury in respect
of any claim based upon or arising out of this Agreement or the transactions
contemplated hereby.

                                       44

<PAGE>
         Please confirm that the foregoing correctly sets forth the agreement
among the Martin Parties and the several Underwriters.

                                   Very truly yours,

                                   MARTIN RESOURCE MANAGEMENT
                                   CORPORATION


                                   By:    /s/ Ruben S. Martin
                                        Name:  Ruben S. Martin
                                        Title: President


                                   MARTIN RESOURCE LLC

                                   By:    Martin Resource Management
                                          Corporation, as sole member



                                          By:  /s/ Ruben S. Martin
                                              Name:  Ruben S. Martin
                                              Title: President


                                    MARTIN MIDSTREAM GP LLC


                                    By:    /s/ Ruben S. Martin
                                         Name:  Ruben S. Martin
                                         Title: Chief Executive Officer


                                    MARTIN MIDSTREAM PARTNERS L.P.

                                    By:    Martin Midstream GP LLC,
                                           as general partner

                                           By:  /s/ Ruben S. Martin
                                               Name:  Ruben S. Martin
                                               Title: Chief Executive Officer

                                      S-1

<PAGE>

                                    MARTIN OPERATING GP LLC

                                    By:    Martin Resource LLC,
                                           as sole member

                                           By:   Martin Resource Management
                                                 Corporation, as sole member


                                                 By:   /s/ Ruben S. Martin
                                                     Name:  Ruben S. Martin
                                                     Title: President


                                    MARTIN OPERATING PARTNERSHIP L.P.

                                    By:    Martin Operating GP LLC,
                                           as general partner

                                           By:   Martin Resource LLC, as sole
                                                 member

                                                 By:  Martin Resource Management
                                                      Corporation, as sole
                                                      member


                                                      By:   /s/ Ruben S. Martin
                                                          Name:  Ruben S. Martin
                                                          Title: President


                                     MARTIN GAS MARINE LLC

                                     By:    Martin Resource Management
                                            Corporation, as sole member


                                            By:  /s/ Ruben S. Martin
                                                Name:  Ruben S. Martin
                                                Title: President

                                      S-2

<PAGE>

                                      MARTIN GAS SALES LLC

                                      By:    Martin Resource Management
                                             Corporation, as sole member



                                             By:  /s/ Ruben S. Martin
                                                 Name:  Ruben S. Martin
                                                 Title: President


                                      MARTIN L.P. GAS, INC.


                                      By:  /s/ Ruben S. Martin
                                          Name:  Ruben S. Martin
                                          Title: President


                                      CF MARTIN SULPHUR HOLDING CORPORATION


                                      By:   /s/ Robert D. Bondurant
                                      Name:  Robert D. Bondurant
                                      Title: Authorized Representative


                                      S-3

<PAGE>


CONFIRMED as of the date first above
mentioned.

      RAYMOND JAMES & ASSOCIATES, INC.
      A. G. EDWARDS & SONS, INC.
      RBC DAIN RAUSCHER INC.

Acting on behalf of themselves and as the
Representatives of the other several
Underwriters named in Schedule I hereto.

By Raymond James & Associates, Inc.


By:  /s/ Allen D. Lassiter
      Authorized Representative


                                      S-4

<PAGE>



                                   SCHEDULE I

<Table>
<Caption>
                                                             Number
                Name                                       Firm Shares
                ----                                       -----------
<S>                                                        <C>
Raymond James & Associates, Inc.                             935,250

A.G. Edwards & Sons, Inc.                                    810,550

RBC Dain Rauscher Inc.                                       748,200

Ferris, Baker Watts, Incorporated                             58,000

Legg Mason Wood Walker, Incorporated                          58,000

McDonald Investments Inc., a KeyCorp Company                  58,000

Morgan Keegan & Company, Inc.                                 58,000

Sanders Morris Harris                                         58,000

Stephens Inc.                                                 58,000

Wedbush Morgan Securities Inc.                                58,000



                                                        ------------
TOTAL:                                                     2,900,000
</Table>


<PAGE>


                                 SCHEDULE 10(Q)

1.       The consent required under the lease with the Tampa Port Authority
         filed as an exhibit to the Registration Statement.

2.       Any maritime consents, applications and/or filings obtained or made in
         connection with the transfer of vessels to the Partnership Entities.

3.       Filings with applicable secretaries of state to effect any conversions
         or mergers contemplated by the Contribution Agreement.

4.       Lien filings and lien releases necessary in connection with the MLP
         Credit Agreement.

5.       All required consents from CF Industries, Inc.

6.       All required consents and/or approvals from the lenders referred in the
         "Use of Proceeds" section of the Prospectus.



<PAGE>



                                    EXHIBIT A

                                  _______, 2002

RAYMOND JAMES & ASSOCIATES, INC.
A. G. EDWARDS & SONS, INC.
RBC DAIN RAUSCHER INC.
As Representatives of the Several Underwriters
c/o Raymond James & Associates, Inc.
880 Carillon Parkway
St. Petersburg, FL 33716

RE:      MARTIN MIDSTREAM PARTNERS L.P. (THE "PARTNERSHIP") -
         RESTRICTION ON STOCK SALES

Dear Sirs:

         This letter is delivered to you pursuant to the Underwriting Agreement
(the "Underwriting Agreement") to be entered into by the Martin Parties (as
defined in the Underwriting Agreement), including the Partnership, as issuer,
Raymond James & Associates, Inc. and the Representatives (the "Representatives")
of certain underwriters (the "Underwriters") to be named therein. Upon the terms
and subject to the conditions of the Underwriting Agreement, the Underwriters
intend to effect a public offering of Common Units of the Partnership (the
"Units"), as described in and contemplated by the registration statement of the
Partnership on Form S-1, File No. 333-91706 (the "Registration Statement"), as
filed with the Securities and Exchange Commission on July 1, 2002 (the
"Offering"). Capitalized terms used but not defined herein have the respective
meanings assigned to such terms in the Underwriting Agreement.

         The undersigned recognizes that it is in the best financial interests
of the undersigned that the Partnership completes the proposed Offering.

         The undersigned further recognizes that the Units held by the
undersigned are, or may be, subject to certain restrictions on transferability,
including those imposed by United States federal securities laws.
Notwithstanding these restrictions, the undersigned has agreed to enter into
this letter agreement to further assure the Underwriters that the Units of the
undersigned, now held or hereafter acquired, will not enter the public market at
a time that might impair the underwriting effort.

         Therefore, as an inducement to the Underwriters to execute the
Underwriting Agreement, the undersigned hereby acknowledges and agrees that the
undersigned will not (i) sell, offer, contract to sell, pledge, grant any option
to purchase or otherwise dispose of (collectively, a "Disposition") any Units,
or any securities convertible into or exercisable or exchangeable for, or any
rights to purchase or otherwise acquire, any Units held by the undersigned or
acquired by the undersigned after the date hereof, or that may be deemed to be
beneficially owned by the undersigned (collectively, the "Lock-Up Units"),
pursuant to the Rules and Regulations promulgated under the Act and the Exchange
Act for a period commencing on the date hereof

                                      A-1

<PAGE>

and ending 180 days after the date of the Partnership's Prospectus first filed
pursuant to Rule 424(b) under the Act, inclusive (the "Lock-Up Period"), without
the prior written consent of Raymond James & Associates, Inc. or (ii) exercise
or seek to exercise or effectuate in any manner any rights of any nature that
the undersigned has or may have hereafter to require the registration under the
Act the undersigned's sale, transfer or other disposition of any of the Lock-Up
Units or other securities of the Martin Parties held by the undersigned, or to
otherwise participate as a selling securityholder in any manner in any
registration effected by the Martin Parties under the Act, including under the
Registration Statement, during the Lock-Up Period. The foregoing restrictions
are expressly agreed to preclude the undersigned from engaging in any hedging,
collar (whether or not for any consideration) or other transaction that is
designed to or reasonably expected to lead or result in a Disposition of Lock-Up
Units during the Lock-Up Period, even if such Lock-Up Units would be disposed of
by someone other than such holder. Such prohibited hedging or other transactions
would include any short sale or any purchase, sale or grant of any right
(including any put or call option or reversal or cancellation thereof) with
respect to any Lock-Up Units or with respect to any security (other than a
broad-based market basket or index) that includes, relates to or derives any
significant part of its value from Lock-Up Units.

         Notwithstanding the agreement not to make any Disposition during the
Lock-Up Period, you have agreed that the foregoing restrictions shall not apply
to:

(1)      the Units being offered in the prospectus included in the Registration
         Statement; or

(2)      Units issued by the Partnership under employee incentive plans or upon
         the exercise of options issued under employee incentive plans.(1)

         It is understood that, if the Underwriting Agreement (other than the
provisions thereof that survive termination) shall terminate or be terminated
prior to payment for and delivery of the Units, you will release the undersigned
from the obligations under this letter agreement.

         In furtherance of the foregoing, the Martin Parties and their transfer
agents and registrars are hereby authorized to decline to make any transfer of
Lock-Up Units if such transfer would constitute a violation or breach of this
letter. This letter shall be binding on the undersigned and the respective
successors, heirs, personal representatives and assigns of the undersigned.

                                                     Very truly yours,

                                                     ---------------------------
                                                     [Name]


----------
(1) For the agreement signed by the Partnership, add: (3) Units issued in
connection with accretive acquisitions; provided that the recipients of such
Units agree to be bound by the restrictions set forth herein.


                                      A-2

<PAGE>


                                    EXHIBIT B

                         FORM OF LOCAL COUNSEL OPINIONS
                             FOR FLORIDA AND ALABAMA



         In the case of the Closing Date only, each of Trenam, Kemker, Scharf,
Barkin, Frye, O'Neill & Mullis, P.A., with respect to the State of Florida, and
Vickers, Riis, Murray and Curran, L.L.C., with respect to the State of Alabama,
shall have furnished to you their written opinions, dated the Closing Date, in
form and substance satisfactory to you, to the effect that:

                  (a) The Operating Partnership has been duly qualified or
         registered as a foreign limited partnership for the transaction of
         business under the laws of [Florida or Alabama, as applicable].

                  (b) The Operating GP has been duly qualified or registered as
         a foreign limited liability company for the transaction of business
         under the laws of [Florida or Alabama, as applicable].

                  (c) Each of the Operative Agreements to which MFSI or
         Midstream is a party has been duly authorized and validly executed and
         delivered by such party. [Alabama only]

                  (d) Each of the Partnership and the Operating Partnership has
         all requisite limited partnership power and authority under the laws of
         the State of [insert applicable state] to own or lease its properties
         and to conduct its business in the State of [insert applicable state],
         in each case in all material respects as described or otherwise
         disclosed in the Prospectus; each of the General Partner and the
         Operating GP has all requisite limited liability company power and
         authority under the laws of the State of [insert applicable state] to
         own or lease its properties and to conduct its business in the State of
         [insert applicable state], in each case in all material respects as
         described or otherwise disclosed in the Prospectus; and upon the
         consummation of the Transactions (assuming that the Partnership will
         not be liable under the laws of the State of Delaware for the
         liabilities of the Operating Partnership and assuming that unitholders
         will not be liable under the laws of the State of Delaware for the
         liabilities of the Partnership or the Operating Partnership), the
         Partnership will not be liable under the laws of the State of [insert
         applicable state] for the liabilities of the Operating Partnership, and
         unitholders will not be liable under the laws of the State of [insert
         applicable state] for the liabilities of the Partnership or the
         Operating Partnership except in each case to the same extent as under
         the laws of the State of Delaware.

                  (e) [Alabama only: The Conversion of MFSI into Midstream was
         legally sufficient under the laws of the State of Alabama to vest in
         Midstream the assets of MFSI located in the State of Alabama.] Assuming
         that the Mergers and the Conversions [Alabama only: , other than the
         Conversion of MFSI into


                                      B-1

<PAGE>

         Midstream,] were legally sufficient under applicable Delaware and Texas
         law to vest in the Operating Partnership, as applicable, the assets of
         the parties to the Mergers and the Conversions, then the Mergers and
         the Conversions were legally sufficient under the law of the State of
         [insert applicable state] to vest, directly or indirectly, in the
         Operating Partnership, as applicable, the assets of the parties to the
         Mergers and the Conversions located in the State of [insert applicable
         state].

                  (f) No permit, consent, approval, authorization, order,
         registration, filing or qualification ("consent") of or with any court,
         governmental agency or body of the State of [insert applicable state]
         having jurisdiction over the Martin Parties or any of their respective
         properties is required for the issuance and sale of the Units by the
         Partnership, or for the conveyance of the properties located in the
         State of [insert applicable state] purported to be conveyed to the
         Operating Partnership, as applicable, pursuant to the Conveyances,
         except (A) for such consents required under the Securities Act, the
         Exchange Act and state securities or "Blue Sky" laws, as to which such
         counsel need not express any opinion, (B) for such consents which have
         been obtained or made, (C) for such consents which (i) are of a routine
         or administrative nature, (ii) are not customarily obtained or made
         prior to the consummation of transactions such as those contemplated by
         this Agreement and the Operative Agreements and (iii) are expected in
         the reasonable judgment of the General Partner to be obtained or made
         in the ordinary course of business subsequent to the consummation of
         the Transactions, (D) for such consents which, if not obtained or made,
         would not, individually or in the aggregate, have a material adverse
         effect upon the operations conducted or to be conducted as described in
         the Prospectus in the State of [insert applicable state] by the
         Partnership Entities or (E) as disclosed in the Prospectus.

                  (g) The execution, delivery and performance of the Conveyances
         relating to the transfer of property in the State of [insert applicable
         state] has not violated and will not violate any statute of the State
         of [insert applicable state] or any rule, regulation or, to the
         knowledge of such counsel, any order of any agency of the State of
         [insert applicable state] having jurisdiction over any of the Martin
         Parties or any of their respective properties, except for any such
         violations which, individually or in the aggregate, would not have a
         material adverse effect on the unitholders or the operations conducted
         in the State of [insert applicable state] by the Partnership Entities,
         taken as a whole.

                  (h) Each of the Conveyances is in a form legally sufficient as
         between the parties thereto to convey to the transferee thereunder all
         of the right, title and interest of the transferor stated therein in
         and to the properties located in the State of [insert applicable
         state], as described in the Conveyances, subject to the conditions,
         reservations and limitations contained in the Conveyances, except motor
         vehicles or other property requiring conveyance of certificated title
         as to which the Conveyances are legally sufficient to compel delivery
         of such certificated title.

                                      B-2

<PAGE>

                  (i) Each of the Conveyances in the form of a deed or real
         property assignment (including, without limitation, the form of the
         exhibits and schedules thereto) is in a form legally sufficient for
         recordation in the appropriate public offices of the State of [insert
         applicable state], to the extent such recordation is required, and,
         upon proper recordation of any of such deeds and real property
         assignments in the State of [insert applicable state], will constitute
         notice to all third parties under the recordation statutes of the State
         of [insert applicable state] concerning record title to the assets
         transferred thereby; recordation in the office of the County Clerk for
         each county in which the Partnership Entities own property is the
         appropriate public office in the State of [insert applicable state] for
         the recordation of deeds and assignments of interests in real property
         located in such county.

         In rendering such opinion, such counsel may (A) rely in respect of
matters of fact upon certificates of officers and employees of the Martin
Parties and upon information obtained from public officials, (B) assume that all
documents submitted to them as originals are authentic, and all copies submitted
to them conform to the originals thereof, and that the signatures on all
documents examined by them are genuine, (C) state that such opinions are limited
to the laws of the State of [insert applicable state], excepting therefrom
municipal and local ordinances and regulations, (D) state that they express no
opinion with respect to state or local taxes or tax statutes to which any of the
limited partners of the Partnership or any of the Partnership Entities may be
subject, and (E) with respect to the opinion in paragraph (i) rely upon
certificates of foreign qualification provided by the Secretary of State of
[insert applicable state] (each of which shall be dated as of the date not more
than fourteen days prior to the Closing Date and provided to you).

         In rendering such opinion, such counsel shall state that (A) Baker
Botts L.L.P. and the Martin Parties are hereby authorized to rely upon such
opinion letter in connection with the Transactions as if such opinion letter
were addressed and delivered to them on the date hereof and (B) subject to the
foregoing, such opinion letter may be relied upon by the Underwriters and its
counsel only in connection with the Transactions and no other use or
distribution of this opinion letter may be made without such counsel's prior
written consent.


                                      B-3

<PAGE>

                                    EXHIBIT C

                              FORM OF LOCAL COUNSEL
                              OPINION FOR LOUISIANA



         In the case of the Closing Date only, Cook, Yancy, King & Galloway, a
Professional law corporation, with respect to the State of Louisiana, shall have
furnished to you its written opinion, dated the Closing Date, in form and
substance satisfactory to you, to the effect that:

                  (a) The Operating Partnership has been duly qualified or
         registered as a foreign limited partnership for the transaction of
         business under the laws of Louisiana.

                  (b) The Operating GP has been duly qualified or registered as
         a foreign limited liability company for the transaction of business
         under the laws of Louisiana.

                  (c) Each of the Partnership and the Operating Partnership has
         all requisite limited partnership power and authority under the laws of
         the State of Louisiana to own or lease its properties and to conduct
         its business in the State of Louisiana, in each case in all material
         respects as described or otherwise disclosed in the Prospectus; each of
         the General Partner and the Operating GP has all requisite limited
         liability company power and authority under the laws of the State of
         Louisiana to own or lease its properties and to conduct its business in
         the State of Louisiana, in each case in all material respects as
         described or otherwise disclosed in the Prospectus; and upon the
         consummation of the Transactions (assuming that the Partnership will
         not be liable under the laws of the State of Delaware for the
         liabilities of the Operating Partnership and assuming that unitholders
         will not be liable under the laws of the State of Delaware for the
         liabilities of the Partnership or the Operating Partnership), the
         Partnership will not be liable under the laws of the State of Louisiana
         for the liabilities of the Operating Partnership, and unitholders will
         not be liable under the laws of the State of Louisiana for the
         liabilities of the Partnership or the Operating Partnership except in
         each case to the same extent as under the laws of the State of
         Delaware.

                  (d) No permit, consent, approval, authorization, order,
         registration, filing or qualification ("consent") of or with any court,
         governmental agency or body of the State of Louisiana having
         jurisdiction over the Martin Parties or any of their respective
         properties is required for the issuance and sale of the Units by the
         Partnership, or for the execution, delivery and performance of that
         certain Product Storage Agreement, by and between Martin Underground
         Storage, Inc. and the Partnership (the "Product Storage Agreement"),
         except (A) for such consents required under the Securities Act, the
         Exchange Act and state securities or "Blue Sky" laws, as to which such
         counsel need not express any opinion, (B) for such consents which have
         been obtained or made, (C) for such consents which (i) are of a routine
         or administrative nature, (ii) are not customarily obtained or made
         prior to the consummation of transactions such as those contemplated by
         this Agreement and the Operative Agreements and (iii) are expected in
         the reasonable judgment of the General Partner to be obtained or made
         in the ordinary course of

                                      C-1

<PAGE>

         business subsequent to the consummation of the Transactions, (D) for
         such consents which, if not obtained or made, would not, individually
         or in the aggregate, have a material adverse effect upon the operations
         conducted or to be conducted as described in the Prospectus in the
         State of Louisiana by the Partnership Entities or (E) as disclosed in
         the Prospectus.

                  (e) The execution, delivery and performance of the Product
         Storage Agreement has not violated and will not violate any statute of
         the State of Louisiana or any rule, regulation or, to the knowledge of
         such counsel, any order of any agency of the State of Louisiana having
         jurisdiction over any of the Martin Parties or any of their respective
         properties, except for any such violations which, individually or in
         the aggregate, would not have a material adverse effect on the
         unitholders or the operations conducted in the State of Louisiana by
         the Partnership Entities, taken as a whole.

         In rendering such opinion, such counsel may (A) rely in respect of
matters of fact upon certificates of officers and employees of the Martin
Parties and upon information obtained from public officials, (B) assume that all
documents submitted to them as originals are authentic, and all copies submitted
to them conform to the originals thereof, and that the signatures on all
documents examined by them are genuine, (C) state that such opinions are limited
to the laws of the State of Louisiana, excepting therefrom municipal and local
ordinances and regulations, (D) state that they express no opinion with respect
to state or local taxes or tax statutes to which any of the limited partners of
the Partnership or any of the Partnership Entities may be subject, and (E) with
respect to the opinion in paragraph (i) rely upon certificates of foreign
qualification provided by the Secretary of State of Louisiana (each of which
shall be dated as of the date not more than fourteen days prior to the Closing
Date and provided to you).

         In rendering such opinion, such counsel shall state that (A) Baker
Botts L.L.P. and the Martin Parties are hereby authorized to rely upon such
opinion letter in connection with the Transactions as if such opinion letter
were addressed and delivered to them on the date hereof and (B) subject to the
foregoing, such opinion letter may be relied upon by the Underwriters and its
counsel only in connection with the Transactions and no other use or
distribution of this opinion letter may be made without such counsel's prior
written consent.


                                      C-2


<PAGE>



                                    EXHIBIT D

                    FORM OF LOCAL COUNSEL OPINION FOR NEVADA



         In the case of the Closing Date only, Marquis & Aurbach shall have
furnished to you their written opinion, dated the Closing Date, in form and
substance satisfactory to you, to the effect that the distribution of assets by
CFMSHC pursuant to a liquidation proceeding was legally sufficient under the
laws of the State of Nevada to vest in each of Marine, MGS and MTI an interest
in CFMSLP on the basis of their pro rata interest in CFMSHC.

         In rendering such opinion, such counsel may (A) rely in respect of
matters of fact upon certificates of officers and employees of the Martin
Parties and upon information obtained from public officials, (B) assume that all
documents submitted to them as originals are authentic, and all copies submitted
to them conform to the originals thereof, and that the signatures on all
documents examined by them are genuine, (C) state that such opinions are limited
to the laws of the State of Nevada, excepting therefrom federal laws including
but not limited to bankruptcy, municipal and local ordinances and regulations
and excepting voidability under the Uniform Fraudulent Transfer Act, codified at
Chapter 112 of the Nevada Revised Statutes (D) state that they express no
opinion with respect to federal, state or local taxes or tax statutes to which
CFMSHC, CFMSLP, or any of the limited partners of the Partnership or any of the
Partnership Entities may be subject.

         In rendering such opinion, such counsel shall state that (A) Baker
Botts L.L.P. and the Martin Parties are hereby authorized to rely upon such
opinion letter in connection with the Transactions as if such opinion letter
were addressed and delivered to them on the date hereof and (B) subject to the
foregoing, such opinion letter may be relied upon by the Underwriters and its
counsel only in connection with the Transactions and no other use or
distribution of this opinion letter may be made without such counsel's prior
written consent.

                                      D-1




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3.1
<SEQUENCE>4
<FILENAME>d00990exv3w1.txt
<DESCRIPTION>FIRST AMENDED AND RESTATED AGREEMENT OF LP
<TEXT>
<PAGE>
                                                                     EXHIBIT 3.1


================================================================================

                                                                  EXECUTION COPY



                           FIRST AMENDED AND RESTATED


                        AGREEMENT OF LIMITED PARTNERSHIP


                                       OF


                         MARTIN MIDSTREAM PARTNERS L.P.




================================================================================



<PAGE>



                                TABLE OF CONTENTS

<Table>
<S>                                                                                                              <C>
ARTICLE I - DEFINITIONS
         Section 1.1       Definitions............................................................................1
         Section 1.2       Construction..........................................................................20

ARTICLE II - ORGANIZATION
         Section 2.1       Formation.............................................................................20
         Section 2.2       Name..................................................................................21
         Section 2.3       Registered Office; Registered Agent; Principal Office; Other Offices..................21
         Section 2.4       Purpose and Business..................................................................21
         Section 2.5       Powers................................................................................22
         Section 2.6       Power of Attorney.....................................................................22
         Section 2.7       Term..................................................................................23
         Section 2.8       Title to Partnership Assets...........................................................23

ARTICLE III - RIGHTS OF LIMITED PARTNERS
         Section 3.1       Limitation of Liability...............................................................24
         Section 3.2       Management of Business................................................................24
         Section 3.3       Outside Activities of the Limited Partners............................................24
         Section 3.4       Rights of Limited Partners............................................................24

ARTICLE IV - CERTIFICATES; RECORD HOLDERS; TRANSFER OF PARTNERSHIP
INTERESTS; REDEMPTION OF PARTNERSHIP INTERESTS
         Section 4.1       Certificates..........................................................................25
         Section 4.2       Mutilated, Destroyed, Lost or Stolen Certificates.....................................25
         Section 4.3       Record Holders........................................................................26
         Section 4.4       Transfer Generally....................................................................27
         Section 4.5       Registration and Transfer of Limited Partner Interests................................27
         Section 4.6       Transfer of the General Partner's General Partner Interest............................28
         Section 4.7       Transfer of Incentive Distribution Rights.............................................29
         Section 4.8       Restrictions on Transfers.............................................................29
         Section 4.9       Citizenship Certificates; Non-citizen Assignees.......................................30
         Section 4.10      Redemption of Partnership Interests of Non-citizen Assignees..........................31

ARTICLE V - CAPITAL CONTRIBUTIONS AND ISSUANCE OF PARTNERSHIP INTERESTS
         Section 5.1       Organizational Contributions..........................................................32
         Section 5.2       Contributions by the General Partner and its Affiliates...............................32
         Section 5.3       Contributions by Initial Limited Partners and Distributions to the General
                           Partner...............................................................................33
         Section 5.4       Interest and Withdrawal...............................................................33
         Section 5.5       Capital Accounts......................................................................34
         Section 5.6       Issuances of Additional Partnership Securities........................................36
         Section 5.7       Limitations on Issuance of Additional Partnership Securities..........................37
</Table>



                                       i
<PAGE>


<Table>
<S>                                                                                                              <C>
         Section 5.8       Conversion of Subordinated Units......................................................40
         Section 5.9       Limited Preemptive Right..............................................................43
         Section 5.10      Splits and Combinations...............................................................44
         Section 5.11      Fully Paid and Non-Assessable Nature of Limited Partner Interests.....................44

ARTICLE VI - ALLOCATIONS AND DISTRIBUTIONS
         Section 6.1       Allocations for Capital Account Purposes..............................................44
         Section 6.2       Allocations for Tax Purposes..........................................................52
         Section 6.3       Requirement and Characterization of Distributions; Distributions to Record
                           Holders...............................................................................54
         Section 6.4       Distributions of Available Cash from Operating Surplus................................55
         Section 6.5       Distributions of Available Cash from Capital Surplus..................................57
         Section 6.6       Adjustment of Minimum Quarterly Distribution and Target Distribution Levels...........57
         Section 6.7       Special Provisions Relating to the Holders of Subordinated Units......................57
         Section 6.8       Special Provisions Relating to the Holders of Incentive Distribution Rights...........58
         Section 6.9       Entity-Level Taxation.................................................................58

ARTICLE VII - MANAGEMENT AND OPERATION OF BUSINESS
         Section 7.1       Management............................................................................59
         Section 7.2       Certificate of Limited Partnership....................................................61
         Section 7.3       Restrictions on the General Partner's Authority.......................................61
         Section 7.4       Reimbursement of the General Partner..................................................62
         Section 7.5       Outside Activities....................................................................63
         Section 7.6       Loans from the General Partner; Loans or Contributions from the
                           Partnership; Contracts with Affiliates; Certain Restrictions on the
                           General Partner.......................................................................64
         Section 7.7       Indemnification.......................................................................65
         Section 7.8       Liability of Indemnitees..............................................................67
         Section 7.9       Resolution of Conflicts of Interest...................................................68
         Section 7.10      Other Matters Concerning the General Partner..........................................70
         Section 7.11      Purchase or Sale of Partnership Securities............................................70
         Section 7.12      Registration Rights of the General Partner and its Affiliates.........................70
         Section 7.13      Reliance by Third Parties.............................................................72

ARTICLE VIII - BOOKS, RECORDS, ACCOUNTING AND REPORTS
         Section 8.1       Records and Accounting................................................................73
         Section 8.2       Fiscal Year...........................................................................73
         Section 8.3       Reports...............................................................................73

ARTICLE IX - TAX MATTERS
         Section 9.1       Tax Returns and Information...........................................................74
         Section 9.2       Tax Elections.........................................................................74
         Section 9.3       Tax Controversies.....................................................................74
         Section 9.4       Withholding...........................................................................74
</Table>



                                       ii
<PAGE>



<Table>
<S>                                                                                                             <C>
ARTICLE X - ADMISSION OF PARTNERS
         Section 10.1      Admission of Initial Limited Partners.................................................75
         Section 10.2      Admission of Substituted Limited Partner..............................................75
         Section 10.3      Admission of Successor General Partner................................................75
         Section 10.4      Admission of Additional Limited Partners..............................................76
         Section 10.5      Amendment of Agreement and Certificate of Limited Partnership.........................76

ARTICLE XI - WITHDRAWAL OR REMOVAL OF PARTNERS
         Section 11.1      Withdrawal of the General Partner.....................................................76
         Section 11.2      Removal of the General Partner........................................................78
         Section 11.3      Interest of Departing Partner and Successor General Partner...........................79
         Section 11.4      Termination of Subordination Period, Conversion of Subordinated Units and
                           Extinguishment of Cumulative Common Unit Arrearages...................................80
         Section 11.5      Withdrawal of Limited Partners........................................................80

ARTICLE XII - DISSOLUTION AND LIQUIDATION
         Section 12.1      Dissolution...........................................................................80
         Section 12.2      Continuation of the Business of the Partnership After Dissolution.....................81
         Section 12.3      Liquidator............................................................................81
         Section 12.4      Liquidation...........................................................................82
         Section 12.5      Cancellation of Certificate of Limited Partnership....................................83
         Section 12.6      Return of Contributions...............................................................83
         Section 12.7      Waiver of Partition...................................................................83
         Section 12.8      Capital Account Restoration...........................................................83

ARTICLE XIII - AMENDMENT OF PARTNERSHIP AGREEMENT; MEETINGS; RECORD DATE
         Section 13.1      Amendment to be Adopted Solely by the General Partner.................................83
         Section 13.2      Amendment Procedures..................................................................85
         Section 13.3      Amendment Requirements................................................................85
         Section 13.4      Special Meetings......................................................................86
         Section 13.5      Notice of a Meeting...................................................................86
         Section 13.6      Record Date...........................................................................87
         Section 13.7      Adjournment...........................................................................87
         Section 13.8      Waiver of Notice; Approval of Meeting; Approval of Minutes............................87
         Section 13.9      Quorum................................................................................87
         Section 13.10     Conduct of a Meeting..................................................................88
         Section 13.11     Action Without a Meeting..............................................................88
         Section 13.12     Voting and Other Rights...............................................................89

ARTICLE XIV - MERGER
         Section 14.1      Authority.............................................................................89
         Section 14.2      Procedure for Merger or Consolidation.................................................89
         Section 14.3      Approval by Limited Partners of Merger or Consolidation...............................90
         Section 14.4      Certificate of Merger.................................................................91
         Section 14.5      Effect of Merger......................................................................91
</Table>



                                      iii
<PAGE>


<Table>
<S>                                                                                                             <C>
ARTICLE XV - RIGHT TO ACQUIRE LIMITED PARTNER INTERESTS
         Section 15.1      Right to Acquire Limited Partner Interests............................................92

ARTICLE XVI - GENERAL PROVISIONS
         Section 16.1      Addresses and Notices.................................................................93
         Section 16.2      Further Action........................................................................94
         Section 16.3      Binding Effect........................................................................94
         Section 16.4      Integration...........................................................................94
         Section 16.5      Creditors.............................................................................94
         Section 16.6      Waiver................................................................................94
         Section 16.7      Counterparts..........................................................................94
         Section 16.8      Applicable Law........................................................................95
         Section 16.9      Invalidity of Provisions..............................................................95
         Section 16.10     Consent of Partners...................................................................95
</Table>



                                       iv
<PAGE>



                 FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED
                  PARTNERSHIP OF MARTIN MIDSTREAM PARTNERS L.P.

         THIS AGREEMENT OF LIMITED PARTNERSHIP OF MARTIN MIDSTREAM PARTNERS
L.P., dated as of November 6, 2002, is entered into by and among Martin
Midstream GP LLC, a Delaware limited liability company, as the General Partner,
and Martin Resource LLC, a Delaware limited liability company, as the
Organizational Limited Partner, together with any other Persons who become
Partners in the Partnership or parties hereto as provided herein. In
consideration of the covenants, conditions and agreements contained herein, the
parties hereto hereby agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

         Section 1.1 Definitions. The following definitions shall be for all
purposes, unless otherwise clearly indicated to the contrary, applied to the
terms used in this Agreement.

         "Acquisition" means any transaction in which any Group Member acquires
(through an asset acquisition, merger, stock acquisition or other form of
investment) control over all or a portion of the assets, properties or business
of another Person for the purpose of increasing the operating capacity or
revenues of the Partnership Group from the operating capacity or revenues of the
Partnership Group existing immediately prior to such transaction.

         "Additional Book Basis" means the portion of any remaining Carrying
Value of an Adjusted Property that is attributable to positive adjustments made
to such Carrying Value as a result of Book-Up Events. For purposes of
determining the extent that Carrying Value constitutes Additional Book Basis:

                  (i) Any negative adjustment made to the Carrying Value of an
         Adjusted Property as a result of either a Book-Down Event or a Book-Up
         Event shall first be deemed to offset or decrease that portion of the
         Carrying Value of such Adjusted Property that is attributable to any
         prior positive adjustments made thereto pursuant to a Book-Up Event or
         Book-Down Event.

                  (ii) If Carrying Value that constitutes Additional Book Basis
         is reduced as a result of a Book-Down Event and the Carrying Value of
         other property is increased as a result of such Book-Down Event, an
         allocable portion of any such increase in Carrying Value shall be
         treated as Additional Book Basis; provided that the amount treated as
         Additional Book Basis pursuant hereto as a result of such Book-Down
         Event shall not exceed the amount by which the Aggregate Remaining Net
         Positive Adjustments after such Book-Down Event exceeds the remaining
         Additional Book Basis attributable to all of the Partnership's Adjusted
         Property after such Book-Down Event (determined without regard to the
         application of this clause (ii) to such Book-Down Event).

         "Additional Book Basis Derivative Items" means any Book Basis
Derivative Items that are computed with reference to Additional Book Basis. To
the extent that the Additional Book Basis attributable to all of the
Partnership's Adjusted Property as of the beginning of any taxable period
exceeds the Aggregate Remaining Net Positive Adjustments as of the beginning of
such



<PAGE>



period (the "Excess Additional Book Basis"), the Additional Book Basis
Derivative Items for such period shall be reduced by the amount that bears the
same ratio to the amount of Additional Book Basis Derivative Items determined
without regard to this sentence as the Excess Additional Book Basis bears to the
Additional Book Basis as of the beginning of such period.

         "Additional Limited Partner" means a Person admitted to the Partnership
as a Limited Partner pursuant to Section 10.4 and who is shown as such on the
books and records of the Partnership.

         "Adjusted Capital Account" means the Capital Account maintained for
each Partner as of the end of each fiscal year of the Partnership, (a) increased
by any amounts that such Partner is obligated to restore under the standards set
by Treasury Regulation Section 1.704-1(b)(2)(ii)(c) (or is deemed obligated to
restore under Treasury Regulation Sections 1.704-2(g) and 1.704-2(i)(5)) and (b)
decreased by (i) the amount of all losses and deductions that, as of the end of
such fiscal year, are reasonably expected to be allocated to such Partner in
subsequent years under Sections 704(e)(2) and 706(d) of the Code and Treasury
Regulation Section 1.751-1(b)(2)(ii), and (ii) the amount of all distributions
that, as of the end of such fiscal year, are reasonably expected to be made to
such Partner in subsequent years in accordance with the terms of this Agreement
or otherwise to the extent they exceed offsetting increases to such Partner's
Capital Account that are reasonably expected to occur during (or prior to) the
year in which such distributions are reasonably expected to be made (other than
increases as a result of a minimum gain chargeback pursuant to Section 6.1(d)(i)
or 6.1(d)(ii)). The foregoing definition of Adjusted Capital Account is intended
to comply with the provisions of Treasury Regulation Section
1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith. The
"Adjusted Capital Account" of a Partner in respect of a General Partner
Interest, a Common Unit, a Subordinated Unit or an Incentive Distribution Right
or any other specified interest in the Partnership shall be the amount which
such Adjusted Capital Account would be if such General Partner Interest, Common
Unit, Subordinated Unit, Incentive Distribution Right or other interest in the
Partnership were the only interest in the Partnership held by such Partner from
and after the date on which such General Partner Interest, Common Unit,
Subordinated Unit, Incentive Distribution Right or other interest was first
issued.

         "Adjusted Operating Surplus" means, with respect to any period,
Operating Surplus generated during such period (a) less (i) any net increase in
Working Capital Borrowings with respect to such period and (ii) any net
reduction in cash reserves for Operating Expenditures with respect to such
period not relating to an Operating Expenditure made during such period, and (b)
plus (i) any net decrease in Working Capital Borrowings with respect to such
period, and (ii) any net increase in cash reserves for Operating Expenditures
with respect to such period required by any debt instrument for the repayment of
principal, interest or premium. Adjusted Operating Surplus does not include that
portion of Operating Surplus included in clause (a)(i) of the definition of
Operating Surplus.

         "Adjusted Property" means any property the Carrying Value of which has
been adjusted pursuant to Section 5.5(d)(i) or 5.5(d)(ii).

         "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,



                                       2
<PAGE>



the Person in question. As used herein, the term "control" means the possession,
direct or indirect, of the power to direct or cause the direction of the
management and policies of a Person, whether through ownership of voting
securities, by contract or otherwise.

         "Aggregate Remaining Net Positive Adjustments" means, as of the end of
any taxable period, the sum of the Remaining Net Positive Adjustments of all the
Partners.

         "Agreed Allocation" means any allocation, other than a Required
Allocation, of an item of income, gain, loss or deduction pursuant to the
provisions of Section 6.1, including, without limitation, a Curative Allocation
(if appropriate to the context in which the term "Agreed Allocation" is used).

         "Agreed Value" of any Contributed Property means the fair market value
of such property or other consideration at the time of contribution as
determined by the General Partner using such reasonable method of valuation as
it may adopt. The General Partner shall, in its discretion, use such method as
it deems reasonable and appropriate to allocate the aggregate Agreed Value of
Contributed Properties contributed to the Partnership in a single or integrated
transaction among each separate property on a basis proportional to the fair
market value of each Contributed Property.

         "Agreement" means this First Amended and Restated Agreement of Limited
Partnership of Martin Midstream Partners L.P., as it may be amended,
supplemented or restated from time to time.

         "Assignee" means a Non-citizen Assignee or a Person to whom one or more
Limited Partner Interests have been transferred in a manner permitted under this
Agreement and who has executed and delivered a Transfer Application as required
by this Agreement, but who has not been admitted as a Substituted Limited
Partner.

         "Associate" means, when used to indicate a relationship with any
Person, (a) any corporation or organization of which such Person is a director,
officer or partner or is, directly or indirectly, the owner of 20% or more of
any class of voting stock or other voting interest; (b) any trust or other
estate in which such Person has at least a 20% beneficial interest or as to
which such Person serves as trustee or in a similar fiduciary capacity; and (c)
any relative or spouse of such Person, or any relative of such spouse, who has
the same principal residence as such Person.

         "Available Cash" means, with respect to any Quarter ending prior to the
Liquidation Date:

                  (a) the sum of (i) all cash and cash equivalents of the
Partnership Group on hand at the end of such Quarter, and (ii) all additional
cash and cash equivalents of the Partnership Group on hand on the date of
determination of Available Cash with respect to such Quarter resulting from
Working Capital Borrowings made subsequent to the end of such Quarter, less

                  (b) the amount of any cash reserves that are necessary or
appropriate in the reasonable discretion of the General Partner to (i) provide
for the proper conduct of the business



                                       3
<PAGE>



of the Partnership Group (including reserves for future capital expenditures and
for anticipated future credit needs of the Partnership Group) subsequent to such
Quarter, (ii) comply with applicable law or any loan agreement, security
agreement, mortgage, debt instrument or other agreement or obligation to which
any Group Member is a party or by which it is bound or its assets are subject or
(iii) provide funds for distributions under Section 6.4 or 6.5 in respect of any
one or more of the next four Quarters; provided, however, that the General
Partner may not establish cash reserves pursuant to (iii) above if the effect of
such reserves would be that the Partnership is unable to distribute the Minimum
Quarterly Distribution on all Common Units, plus any Cumulative Common Unit
Arrearage on all Common Units, with respect to such Quarter; and, provided
further, that disbursements made by a Group Member or cash reserves established,
increased or reduced after the end of such Quarter but on or before the date of
determination of Available Cash with respect to such Quarter shall be deemed to
have been made, established, increased or reduced, for purposes of determining
Available Cash, within such Quarter if the General Partner so determines.

         Notwithstanding the foregoing, "Available Cash" with respect to the
Quarter in which the Liquidation Date occurs and any subsequent Quarter shall
equal zero.

         "Book Basis Derivative Items" means any item of income, deduction, gain
or loss included in the determination of Net Income or Net Loss that is computed
with reference to the Carrying Value of an Adjusted Property (e.g.,
depreciation, depletion, or gain or loss with respect to an Adjusted Property).

         "Book-Down Event" means an event which triggers a negative adjustment
to the Capital Accounts of the Partners pursuant to Section 5.5(d).

         "Book-Tax Disparity" means with respect to any item of Contributed
Property or Adjusted Property, as of the date of any determination, the
difference between the Carrying Value of such Contributed Property or Adjusted
Property and the adjusted basis thereof for federal income tax purposes as of
such date. A Partner's share of the Partnership's Book-Tax Disparities in all of
its Contributed Property and Adjusted Property will be reflected by the
difference between such Partner's Capital Account balance as maintained pursuant
to Section 5.5 and the hypothetical balance of such Partner's Capital Account
computed as if it had been maintained strictly in accordance with federal income
tax accounting principles.

         "Book-Up Event" means an event which triggers a positive adjustment to
the Capital Accounts of the Partners pursuant to Section 5.5(d).

         "Business" has the meaning assigned to such term in the Omnibus
Agreement.

         "Business Day" means Monday through Friday of each week, except that a
legal holiday recognized as such by the government of the United States of
America or the State of Texas shall not be regarded as a Business Day.

         "Capital Account" means the capital account maintained for a Partner
pursuant to Section 5.5. The "Capital Account" of a Partner in respect of a
General Partner Interest, a Common Unit, a Subordinated Unit, an Incentive
Distribution Right or any other Partnership Interest shall be the amount which
such Capital Account would be if such General Partner




                                       4
<PAGE>



Interest, Common Unit, Subordinated Unit, Incentive Distribution Right or other
Partnership Interest were the only interest in the Partnership held by such
Partner from and after the date on which such General Partner Interest, Common
Unit, Subordinated Unit, Incentive Distribution Right or other Partnership
Interest was first issued.

         "Capital Contribution" means any cash, cash equivalents or the Net
Agreed Value of Contributed Property that a Partner contributes to the
Partnership pursuant to this Agreement or the Contribution Agreement, or any
payment made by the General Partner to the Partnership described in Section
5.2(c).

         "Capital Improvement" means any (a) addition or improvement to the
capital assets owned by any Group Member or (b) acquisition of existing, or the
construction of new, capital assets (including, without limitation, marine
transportation, storage facilities and logistics assets, and related assets), in
each case if such addition, improvement, acquisition or construction is made to
increase the operating capacity or revenues of the Partnership Group from the
operating capacity or revenues of the Partnership Group existing immediately
prior to such addition, improvement, acquisition or construction.

         "Capital Surplus" has the meaning assigned to such term in Section
6.3(a).

         "Carrying Value" means (a) with respect to a Contributed Property, the
Agreed Value of such property reduced (but not below zero) by all depreciation,
amortization and cost recovery deductions charged to the Partners' and
Assignees' Capital Accounts in respect of such Contributed Property, and (b)
with respect to any other Partnership property, the adjusted basis of such
property for federal income tax purposes, all as of the time of determination.
The Carrying Value of any property shall be adjusted from time to time in
accordance with Sections 5.5(d)(i) and 5.5(d)(ii) and to reflect changes,
additions or other adjustments to the Carrying Value for dispositions and
acquisitions of Partnership properties, as deemed appropriate by the General
Partner.

         "Cause" means a court of competent jurisdiction has entered a final,
non-appealable judgment finding the General Partner liable for actual fraud,
gross negligence or willful or wanton misconduct in its capacity as a general
partner of the Partnership.

         "Certificate" means a certificate (i) substantially in the form of
Exhibit A to this Agreement, (ii) issued in global form in accordance with the
rules and regulations of the Depositary or (iii) in such other form as may be
adopted by the General Partner in its discretion, issued by the Partnership
evidencing ownership of one or more Common Units or a certificate, in such form
as may be adopted by the General Partner in its discretion, issued by the
Partnership evidencing ownership of one or more other Partnership Securities.

         "Certificate of Limited Partnership" means the Certificate of Limited
Partnership of the Partnership filed with the Secretary of State of the State of
Delaware as such Certificate of Limited Partnership may be amended, supplemented
or restated from time to time.

         "Citizenship Certification" means a properly completed certificate in
such form as may be specified by the General Partner by which a Limited Partner
or an Assignee certifies that he



                                       5
<PAGE>



(and if he is a nominee holding for the account of another Person, that to the
best of his knowledge such other Person) is an Eligible Citizen.

         "Claim" has the meaning assigned to such term in Section 7.12(c).

         "Closing Date" means the first date on which Common Units are sold by
the Partnership to the Underwriters pursuant to the provisions of the
Underwriting Agreement.

         "Closing Price" has the meaning assigned to such term in Section
15.1(a).

         "Code" means the Internal Revenue Code of 1986, as amended and in
effect from time to time. Any reference herein to a specific section or sections
of the Code shall be deemed to include a reference to any corresponding
provision of any successor law.

         "Combined Interest" has the meaning assigned to such term in Section
11.3(a).

         "Commission" means the United States Securities and Exchange
Commission.

         "Common Unit" means a Partnership Security representing a fractional
part of the Partnership Interests of all Limited Partners and Assignees and of
the General Partner, and having the rights and obligations specified with
respect to Common Units in this Agreement. The term "Common Unit" does not refer
to a Subordinated Unit prior to its conversion into a Common Unit pursuant to
the terms hereof.

         "Common Unit Arrearage" means, with respect to any Common Unit,
whenever issued, as to any Quarter within the Subordination Period, the excess,
if any, of (a) the Minimum Quarterly Distribution with respect to a Common Unit
in respect of such Quarter over (b) the sum of all Available Cash distributed
with respect to a Common Unit in respect of such Quarter pursuant to Section
6.4(a)(i).

         "Conflicts Committee" means a committee of the Board of Directors of
the General Partner composed entirely of two or more directors who are not (a)
security holders, officers or employees of the General Partner, (b) officers,
directors or employees of any Affiliate of the General Partner or (c) holders of
any ownership interest in the Partnership Group other than Common Units and who
also meet the independence standards required to serve on an audit committee of
a board of directors by the National Securities Exchange on which the Common
Units are listed for trading.

         "Contributed Property" means each property or other asset, in such form
as may be permitted by the Delaware Act, but excluding cash, contributed to the
Partnership. Once the Carrying Value of a Contributed Property is adjusted
pursuant to Section 5.5(d), such property shall no longer constitute a
Contributed Property, but shall be deemed an Adjusted Property.

         "Contribution Agreement" means that certain Contribution, Conveyance
and Assumption Agreement, dated as of the Closing Date, among the General
Partner, the Partnership, the Operating Partnership, Martin Resource Management
Corporation and certain other Affiliates of Martin Resource Management
Corporation, together with the additional conveyance documents and instruments
contemplated or referenced thereunder.



                                       6
<PAGE>



         "Controlled Person" means any corporation or partnership of which the
Partnership or any Subsidiary owns or controls an interest in excess of 25%.

         "Cumulative Common Unit Arrearage" means, with respect to any Common
Unit, whenever issued, and as of the end of any Quarter, the excess, if any, of
(a) the sum resulting from adding together the Common Unit Arrearage as to an
Initial Common Unit for each of the Quarters within the Subordination Period
ending on or before the last day of such Quarter over (b) the sum of any
distributions theretofore made pursuant to Section 6.4(a)(ii) and the second
sentence of Section 6.5 with respect to an Initial Common Unit (including any
distributions to be made in respect of the last of such Quarters).

         "Curative Allocation" means any allocation of an item of income, gain,
deduction, loss or credit pursuant to the provisions of Section 6.1(d)(xi).

         "Current Market Price" has the meaning assigned to such term in Section
15.1(a).

         "Delaware Act" means the Delaware Revised Uniform Limited Partnership
Act, 6 Del. C. Section 17-101, et seq., as amended, supplemented or restated
from time to time, and any successor to such statute.

         "Departing Partner" means a former General Partner from and after the
effective date of any withdrawal or removal of such former General Partner
pursuant to Section 11.1 or 11.2.

         "Depositary" means, with respect to any Units issued in global form,
The Depository Trust Company and its successors and permitted assigns.

         "Economic Risk of Loss" has the meaning set forth in Treasury
Regulation Section 1.752-2(a).

         "Eligible Citizen" means a Person who is (i) qualified to own interests
in real property in jurisdictions in which any Group Member does business or
proposes to do business from time to time, and whose status as a Limited Partner
or Assignee does not or would not subject such Group Member to a significant
risk of cancellation or forfeiture of any of its properties or any interest
therein and (ii) is not a Non-citizen.

         "Event of Withdrawal" has the meaning assigned to such term in Section
11.1(a).

         "Final Subordinated Units" has the meaning assigned to such term in
Section 6.1(d)(x).

         "First Liquidation Target Amount" has the meaning assigned to such term
in Section 6.1(c)(i)(D).

         "First Target Distribution" means $0.55 per Unit per Quarter (or, with
respect to the period commencing on the Closing Date and ending on December 31,
2002, it means the product of $0.55 multiplied by a fraction of which the
numerator is the number of days in such period, and of which the denominator is
91), subject to adjustment in accordance with Sections 6.6 and 6.9.



                                       7
<PAGE>



         "Fully Diluted Basis" means, when calculating the number of Outstanding
Units for any period, a basis that includes, in addition to the Outstanding
Units, all Partnership Securities and options, rights, warrants and appreciation
rights relating to an equity interest in the Partnership (a) that are
convertible into or exercisable or exchangeable for Units that are senior to or
pari passu with the Subordinated Units, (b) whose conversion, exercise or
exchange price is less than the Current Market Price on the date of such
calculation, (c) that may be converted into or exercised or exchanged for such
Units prior to or during the Quarter following the end of the last Quarter
contained in the period for which the calculation is being made without the
satisfaction of any contingency beyond the control of the holder other than the
payment of consideration and the compliance with administrative mechanics
applicable to such conversion, exercise or exchange, and (d) were not converted
into or exercised or exchanged for such Units prior to the end of the last
quarter referred to in clause (c) above; provided that for purposes of
determining the number of Outstanding Units on a Fully Diluted Basis when
calculating whether the Subordination Period has ended or Subordinated Units are
entitled to convert into Common Units pursuant to Section 5.8, such Partnership
Securities, options, rights, warrants and appreciation rights shall be deemed to
have been Outstanding Units only for the four Quarters that comprise the last
four Quarters of the measurement period; provided, further, that if
consideration will be paid to any Group Member in connection with such
conversion, exercise or exchange, the number of Units to be included in such
calculation shall be that number equal to the difference between (i) the number
of Units issuable upon such conversion, exercise or exchange and (ii) the number
of Units which such consideration would purchase at the Current Market Price.

         "General Partner" means Martin Midstream GP LLC and its successors and
permitted assigns as general partner of the Partnership.

         "General Partner Interest" means the ownership interest of the General
Partner in the Partnership (in its capacity as a general partner without
reference to any Limited Partner Interest held by it) which may be evidenced by
Partnership Securities or a combination thereof or interest therein, and
includes any and all benefits to which the General Partner is entitled as
provided in this Agreement, together with all obligations of the General Partner
to comply with the terms and provisions of this Agreement.

         "Group" means a Person that with or through any of its Affiliates or
Associates has any agreement, arrangement or understanding for the purpose of
acquiring, holding, voting (except voting pursuant to a revocable proxy or
consent given to such Person in response to a proxy or consent solicitation made
to 10 or more Persons) or disposing of any Partnership Securities with any other
Person that beneficially owns, or whose Affiliates or Associates beneficially
own, directly or indirectly, Partnership Securities.

         "Group Member" means a member of the Partnership Group.

         "Holder" as used in Section 7.12, has the meaning assigned to such term
in Section 7.12(a).

         "Incentive Distribution Right" means a non-voting Limited Partner
Interest issued to the General Partner in connection with the transfer of all of
its interest in the Operating Partnership



                                       8
<PAGE>



and Martin Operating GP LLC pursuant to Section 5.2, which Partnership Interest
will confer upon the holder thereof only the rights and obligations specifically
provided in this Agreement with respect to Incentive Distribution Rights (and no
other rights otherwise available to or other obligations of a holder of a
Partnership Interest). Notwithstanding anything in this Agreement to the
contrary, the holder of an Incentive Distribution Right shall not be entitled to
vote such Incentive Distribution Right on any Partnership matter except as may
otherwise be required by law.

         "Incentive Distributions" means any amount of cash distributed to the
holders of the Incentive Distribution Rights pursuant to Sections 6.4(a)(v),
(vi) and (vii) and 6.4(b)(iii), (iv) and (v).

         "Indemnified Persons" has the meaning assigned to such term in Section
7.12(c).

         "Indemnitee" means (a) the General Partner, (b) any Departing Partner,
(c) any Person who is or was an Affiliate of the General Partner or any
Departing Partner, (d) any Person who is or was a member, partner, officer,
director, employee, agent or trustee of any Group Member, the General Partner or
any Departing Partner or any Affiliate of any Group Member, the General Partner
or any Departing Partner, and (e) any Person who is or was serving at the
request of the General Partner or any Departing Partner or any Affiliate of the
General Partner or any Departing Partner as an officer, director, employee,
member, partner, agent, fiduciary or trustee of another Person; provided, that a
Person shall not be an Indemnitee by reason of providing, on a fee-for-services
basis, trustee, fiduciary or custodial services.

         "Initial Common Units" means the Common Units sold in the Initial
Offering.

         "Initial Limited Partners" means the General Partner and the
Underwriters, in each case upon being admitted to the Partnership in accordance
with Section 10.1.

         "Initial Offering" means the initial offering and sale of Common Units
to the public, as described in the Registration Statement.

         "Initial Unit Price" means (a) with respect to the Common Units and the
Subordinated Units, the initial public offering price per Common Unit at which
the Underwriters offered the Common Units to the public for sale as set forth on
the cover page of the prospectus included as part of the Registration Statement
and first issued at or after the time the Registration Statement first became
effective or (b) with respect to any other class or series of Units, the price
per Unit at which such class or series of Units is initially sold by the
Partnership, as determined by the General Partner, in each case adjusted as the
General Partner determines to be appropriate to give effect to any distribution,
subdivision or combination of Units.

         "Interim Capital Transactions" means the following transactions if they
occur prior to the Liquidation Date: (a) borrowings, refinancings or refundings
of indebtedness and sales of debt securities (other than Working Capital
Borrowings and other than for items purchased on open account in the ordinary
course of business) by any Group Member; (b) sales of equity interests by any
Group Member (including the Common Units sold to the Underwriters pursuant to
the exercise of their over-allotment option); and (c) sales or other voluntary
or involuntary dispositions of any assets of any Group Member other than (i)
sales or other dispositions of



                                       9
<PAGE>



inventory, accounts receivable and other assets in the ordinary course of
business, and (ii) sales or other dispositions of assets as part of normal
retirements or replacements.

         "Issue Price" means the price at which a Unit is purchased from the
Partnership, after taking into account any sales commission or underwriting
discount charged to the Partnership.

         "Limited Partner" means, unless the context otherwise requires, (a) the
Organizational Limited Partner prior to its withdrawal from the Partnership,
each Initial Limited Partner, each Substituted Limited Partner, each Additional
Limited Partner and any Departing Partner upon the change of its status from
General Partner to Limited Partner pursuant to Section 11.3 or (b) solely for
purposes of Articles V, VI, VII and IX, each Assignee; provided, however, that
when the term "Limited Partner" is used herein in the context of any vote or
other approval, including without limitation Articles XIII and XIV, such term
shall not, solely for such purpose, include any holder of an Incentive
Distribution Right except as may otherwise be required by law.

         "Limited Partner Interest" means the ownership interest of a Limited
Partner or Assignee in the Partnership, which may be evidenced by Common Units,
Subordinated Units, Incentive Distribution Rights or other Partnership
Securities or a combination thereof or interest therein, and includes any and
all benefits to which such Limited Partner or Assignee is entitled as provided
in this Agreement, together with all obligations of such Limited Partner or
Assignee to comply with the terms and provisions of this Agreement; provided,
however, that when the term "Limited Partner Interest" is used herein in the
context of any vote or other approval, including without limitation Articles
XIII and XIV, such term shall not, solely for such purpose, include any holder
of an Incentive Distribution Right except as may otherwise be required by law.

         "Liquidation Date" means (a) in the case of an event giving rise to the
dissolution of the Partnership of the type described in clauses (a) and (b) of
the first sentence of Section 12.2, the date on which the applicable time period
during which the holders of Outstanding Units have the right to elect to
reconstitute the Partnership and continue its business has expired without such
an election being made, and (b) in the case of any other event giving rise to
the dissolution of the Partnership, the date on which such event occurs.

         "Liquidator" means one or more Persons selected by the General Partner
to perform the functions described in Section 12.3 as liquidating trustee of the
Partnership within the meaning of the Delaware Act.

         "Merger Agreement" has the meaning assigned to such term in Section
14.1.

         "Minimum Quarterly Distribution" means $0.50 per Unit per Quarter (or
with respect to the period commencing on the Closing Date and ending on December
31, 2002, it means the product of $0.50 multiplied by a fraction of which the
numerator is the number of days in such period and of which the denominator is
91), subject to adjustment in accordance with Sections 6.6 and 6.9.

         "National Securities Exchange" means an exchange registered with the
Commission under Section 6(a) of the Securities Exchange Act of 1934, as
amended, supplemented or restated from time to time, and any successor to such
statute, or the Nasdaq Stock Market or any successor thereto.



                                       10
<PAGE>



         "Net Agreed Value" means, (a) in the case of any Contributed Property,
the Agreed Value of such property reduced by any liabilities either assumed by
the Partnership upon such contribution or to which such property is subject when
contributed, and (b) in the case of any property distributed to a Partner or
Assignee by the Partnership, the Partnership's Carrying Value of such property
(as adjusted pursuant to Section 5.5(d)(ii)) at the time such property is
distributed, reduced by any indebtedness either assumed by such Partner or
Assignee upon such distribution or to which such property is subject at the time
of distribution, in either case, as determined under Section 752 of the Code.

         "Net Income" means, for any taxable year, the excess, if any, of the
Partnership's items of income and gain (other than those items taken into
account in the computation of Net Termination Gain or Net Termination Loss) for
such taxable year over the Partnership's items of loss and deduction (other than
those items taken into account in the computation of Net Termination Gain or Net
Termination Loss) for such taxable year. The items included in the calculation
of Net Income shall be determined in accordance with Section 5.5(b) and shall
not include any items specially allocated under Section 6.1(d); provided that
the determination of the items that have been specially allocated under Section
6.1(d) shall be made as if Section 6.1(d)(xii) were not in this Agreement.

         "Net Loss" means, for any taxable year, the excess, if any, of the
Partnership's items of loss and deduction (other than those items taken into
account in the computation of Net Termination Gain or Net Termination Loss) for
such taxable year over the Partnership's items of income and gain (other than
those items taken into account in the computation of Net Termination Gain or Net
Termination Loss) for such taxable year. The items included in the calculation
of Net Loss shall be determined in accordance with Section 5.5(b) and shall not
include any items specially allocated under Section 6.1(d); provided that the
determination of the items that have been specially allocated under Section
6.1(d) shall be made as if Section 6.1(d)(xii) were not in this Agreement.

         "Net Positive Adjustments" means, with respect to any Partner, the
excess, if any, of the total positive adjustments over the total negative
adjustments made to the Capital Account of such Partner pursuant to Book-Up
Events and Book-Down Events.

         "Net Termination Gain" means, for any taxable year, the sum, if
positive, of all items of income, gain, loss or deduction recognized by the
Partnership after the Liquidation Date. The items included in the determination
of Net Termination Gain shall be determined in accordance with Section 5.5(b)
and shall not include any items of income, gain or loss specially allocated
under Section 6.1(d).

         "Net Termination Loss" means, for any taxable year, the sum, if
negative, of all items of income, gain, loss or deduction recognized by the
Partnership after the Liquidation Date. The items included in the determination
of Net Termination Loss shall be determined in accordance with Section 5.5(b)
and shall not include any items of income, gain or loss specially allocated
under Section 6.1(d).

         "Non-citizen" means (1) any person (including any individual, a
partnership, a corporation or an association) who is not a United States
citizen, within the meaning of Section 2



                                       11
<PAGE>
of the Shipping Act, 1916, as amended or as it may hereafter be amended; (2) any
foreign government or representative thereof; (3) any corporation, the
president, chief executive officer or chairman of the board of directors of
which is a Non-citizen, or of which more than a minority or the number of its
directors necessary to constitute a quorum are Non-citizens; (4) any corporation
organized under the laws of any foreign government; (5) any corporation of which
25%or greater interest is owned beneficially or of record, or may be voted by, a
Non-citizen or Non-citizens, or which by any other means whatsoever is
controlled by or in which control is permitted to be exercised by a Non-citizen
or Non-citizens (the General Partner being authorized to determine reasonably
the meaning of "control" for this purpose); (6) any partnership or association
which is controlled by a Non-citizen or Non-citizens; or (7) any person
(including an individual, partnership, corporation or association) who acts as
representative of or fiduciary for any person described in clauses (1) through
(6) above.

         "Non-citizen Assignee" means a Person whom the General Partner has
determined in its discretion does not constitute an Eligible Citizen and as to
whose Partnership Interest the General Partner has become the Substituted
Limited Partner pursuant to Section 4.9.

         "Nonrecourse Built-in Gain" means with respect to any Contributed
Properties or Adjusted Properties that are subject to a mortgage or pledge
securing a Nonrecourse Liability, the amount of any taxable gain that would be
allocated to the Partners pursuant to Sections 6.2(b)(i)(A), 6.2(b)(ii)(A) and
6.2(b)(iii) if such properties were disposed of in a taxable transaction in full
satisfaction of such liabilities and for no other consideration.

         "Nonrecourse Deductions" means any and all items of loss, deduction or
expenditure (including, without limitation, any expenditure described in Section
705(a)(2)(B) of the Code) that, in accordance with the principles of Treasury
Regulation Section 1.704-2(b), are attributable to a Nonrecourse Liability.

         "Nonrecourse Liability" has the meaning set forth in Treasury
Regulation Section 1.752-1(a)(2).

         "Notice of Election to Purchase" has the meaning assigned to such term
in Section 15.1(b).

         "Omnibus Agreement" means that Omnibus Agreement, dated as of the
Closing Date, among Martin Resource Management Corporation, the General Partner,
the Partnership and the Operating Partnership.

         "Operating Expenditures" means all Partnership Group expenditures,
including, but not limited to, taxes, reimbursements of the General Partner,
repayment of Working Capital Borrowings, debt service payments and capital
expenditures, subject to the following:

                  (a) Payments (including prepayments) of principal of and
premium on indebtedness other than Working Capital Borrowings shall not
constitute Operating Expenditures; and

                  (b) Operating Expenditures shall not include (i) capital
expenditures made for Acquisitions or for Capital Improvements, (ii) payment of
transaction expenses relating to



                                       12
<PAGE>



Interim Capital Transactions or (iii) distributions to Partners. Where capital
expenditures are made in part for Acquisitions or for Capital Improvements and
in part for other purposes, the General Partner's good faith allocation between
the amounts paid for each shall be conclusive.

         "Operating Partnership" means Martin Operating Partnership, L.P., a
Delaware limited partnership, and any successors thereto.

         "Operating Partnership Agreement" means the Amended and Restated
Partnership Agreement of the Operating Partnership, as it may be amended,
supplemented or restated from time to time.

         "Operating Surplus" means, with respect to any period ending prior to
the Liquidation Date, on a cumulative basis and without duplication,

                  (a) the sum of (i) $8.5 million plus (ii) all cash and cash
equivalents of the Partnership Group on hand as of the close of business on the
Closing Date, (iii) all cash receipts of the Partnership Group for the period
beginning on the Closing Date and ending with the last day of such period, other
than cash receipts from Interim Capital Transactions (except to the extent
specified in Section 6.5) and (iv) all cash receipts of the Partnership Group
after the end of such period but on or before the date of determination of
Operating Surplus with respect to such period resulting from Working Capital
Borrowings, less

                  (b) the sum of (i) Operating Expenditures for the period
beginning on the Closing Date and ending with the last day of such period and
(ii) the amount of cash reserves that is necessary or advisable in the
reasonable discretion of the General Partner to provide funds for future
Operating Expenditures; provided, however, that disbursements made (including
contributions to a Group Member or disbursements on behalf of a Group Member) or
cash reserves established, increased or reduced after the end of such period but
on or before the date of determination of Available Cash with respect to such
period shall be deemed to have been made, established, increased or reduced, for
purposes of determining Operating Surplus, within such period if the General
Partner so determines.

         Notwithstanding the foregoing, "Operating Surplus" with respect to the
Quarter in which the Liquidation Date occurs and any subsequent Quarter shall
equal zero.

         "Opinion of Counsel" means a written opinion of counsel (who may be
regular counsel to the Partnership or the General Partner or any of its
Affiliates) acceptable to the General Partner in its reasonable discretion.

         "Option Closing Date" means the date or dates on which any Common Units
are sold by the Partnership to the Underwriters upon exercise of the
Over-Allotment Option.

         "Organizational Limited Partner" means Martin Resource LLC in its
capacity as the organizational limited partner of the Partnership pursuant to
this Agreement.

         "Outstanding" means, with respect to Partnership Securities, all
Partnership Securities that are issued by the Partnership and reflected as
outstanding on the Partnership's books and records as of the date of
determination; provided, however, that if at any time any Person or



                                       13
<PAGE>



Group (other than the General Partner or its Affiliates) beneficially owns 20%
or more of any Outstanding Partnership Securities of any class then Outstanding,
all Partnership Securities owned by such Person or Group shall not be voted on
any matter and shall not be considered to be Outstanding when sending notices of
a meeting of Limited Partners to vote on any matter (unless otherwise required
by law), calculating required votes, determining the presence of a quorum or for
other similar purposes under this Agreement, except that Common Units so owned
shall be considered to be Outstanding for purposes of Section 11.1(b)(iv) (such
Common Units shall not, however, be treated as a separate class of Partnership
Securities for purposes of this Agreement); provided, further, that the
foregoing limitation shall not apply (i) to any Person or Group who acquired 20%
or more of any Outstanding Partnership Securities of any class then Outstanding
directly from the General Partner or its Affiliates, (ii) to any Person or Group
who acquired 20% or more of any Outstanding Partnership Securities of any class
then Outstanding directly or indirectly from a Person or Group described in
clause (i) provided that the General Partner shall have notified such Person or
Group in writing that such limitation shall not apply, or (iii) to any Person or
Group who acquired 20% or more of any Partnership Securities issued by the
Partnership with the prior approval of the Board of Directors of the General
Partner; provided further, that the provisions contained herein may be amended
by the General Partner as provided in Section 13.1 hereof.

         "Over-Allotment Option" means the over-allotment option granted to the
Underwriters by the Partnership pursuant to the Underwriting Agreement.

         "Parity Units" means Common Units and all other Units of any other
class or series that have the right (i) to receive distributions of Available
Cash from Operating Surplus pursuant to each of subclauses (a)(i) and (a)(ii) of
Section 6.4 in the same order of priority with respect to the participation of
Common Units in such distributions or (ii) to participate in allocations of Net
Termination Gain pursuant to Section 6.1(c)(i)(B) in the same order of priority
with the Common Units, in each case regardless of whether the amounts or value
so distributed or allocated on each Parity Unit equals the amount or value so
distributed or allocated on each Common Unit. Units whose participation in such
(i) distributions of Available Cash from Operating Surplus and (ii) allocations
of Net Termination Gain are subordinate in order of priority to such
distributions and allocations on Common Units shall not constitute Parity Units
even if such Units are convertible under certain circumstances into Common Units
or Parity Units.

         "Partner Nonrecourse Debt" has the meaning set forth in Treasury
Regulation Section 1.704-2(b)(4).

         "Partner Nonrecourse Debt Minimum Gain" has the meaning set forth in
Treasury Regulation Section 1.704-2(i)(2).

         "Partner Nonrecourse Deductions" means any and all items of loss,
deduction or expenditure (including, without limitation, any expenditure
described in Section 705(a)(2)(B) of the Code) that, in accordance with the
principles of Treasury Regulation Section 1.704-2(i), are attributable to a
Partner Nonrecourse Debt.

         "Partners" means the General Partner and the Limited Partners.



                                       14
<PAGE>



         "Partnership" means Martin Midstream Partners L.P., a Delaware limited
partnership, and any successors thereto.

         "Partnership Group" means the Partnership, the Operating Partnership
and any Subsidiary of any such entity, treated as a single consolidated entity.

         "Partnership Interest" means an interest in the Partnership, which
shall include the General Partner Interest and Limited Partner Interests.

         "Partnership Minimum Gain" means that amount determined in accordance
with the principles of Treasury Regulation Section 1.704-2(d).

         "Partnership Security" means any class or series of equity interest in
the Partnership (but excluding any options, rights, warrants and appreciation
rights relating to an equity interest in the Partnership), including without
limitation, Common Units, Subordinated Units and Incentive Distribution Rights.

         "Percentage Interest" means as of any date of determination (a) as to
the General Partner (in its capacity as General Partner without reference to any
Limited Partner Interests held by it), 2.0%, (b) as to any Unitholder or
Assignee holding Units, the product obtained by multiplying (i) 98% less the
percentage applicable to paragraph (c) by (ii) the quotient obtained by dividing
(A) the number of Units held by such Unitholder or Assignee by (B) the total
number of all Outstanding Units, and (c) as to the holders of additional
Partnership Securities issued by the Partnership in accordance with Section 5.6,
the percentage established as a part of such issuance. The Percentage Interest
with respect to an Incentive Distribution Right shall at all times be zero.

         "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.

         "Per Unit Capital Amount" means, as of any date of determination, the
Capital Account, stated on a per Unit basis, underlying any Unit held by a
Person other than the General Partner or any Affiliate of the General Partner
who holds Units.

         "Pro Rata" means (a) when modifying Units or any class thereof,
apportioned equally among all designated Units in accordance with their relative
Percentage Interests, (b) when modifying Partners and Assignees, apportioned
among all Partners and Assignees in accordance with their relative Percentage
Interests and (c) when modifying holders of Incentive Distribution Rights,
apportioned equally among all holders of Incentive Distribution Rights in
accordance with the relative number of Incentive Distribution Rights held by
each such holder.

         "Purchase Date" means the date determined by the General Partner as the
date for purchase of all Outstanding Units of a certain class (other than Units
owned by the General Partner and its Affiliates) pursuant to Article XV.

         "Quarter" means, unless the context requires otherwise, a fiscal
quarter, or, with respect to the first fiscal quarter after the Closing Date,
the portion of such fiscal quarter after the Closing Date, of the Partnership.



                                       15
<PAGE>



         "Recapture Income" means any gain recognized by the Partnership
(computed without regard to any adjustment required by Section 734 or Section
743 of the Code) upon the disposition of any property or asset of the
Partnership, which gain is characterized as ordinary income because it
represents the recapture of deductions previously taken with respect to such
property or asset.

         "Record Date" means the date established by the General Partner for
determining (a) the identity of the Record Holders entitled to notice of, or to
vote at, any meeting of Limited Partners or entitled to vote by ballot or give
approval of Partnership action in writing without a meeting or entitled to
exercise rights in respect of any lawful action of Limited Partners or (b) the
identity of Record Holders entitled to receive any report or distribution or to
participate in any offer.

         "Record Holder" means the Person in whose name a Common Unit is
registered on the books of the Transfer Agent as of the opening of business on a
particular Business Day, or with respect to other Partnership Securities, the
Person in whose name any such other Partnership Security is registered on the
books which the General Partner has caused to be kept as of the opening of
business on such Business Day.

         "Redeemable Interests" means any Partnership Interests for which a
redemption notice has been given, and has not been withdrawn, pursuant to
Section 4.10.

         "Registration Statement" means the Registration Statement on Form S-1
(Registration No. 333-91706) as it has been or as it may be amended or
supplemented from time to time, filed by the Partnership with the Commission
under the Securities Act to register the offering and sale of the Common Units
in the Initial Offering.

         "Remaining Net Positive Adjustments" means as of the end of any taxable
period, (i) with respect to the Unitholders holding Common Units or Subordinated
Units, the excess of (a) the Net Positive Adjustments of the Unitholders holding
Common Units or Subordinated Units as of the end of such period over (b) the sum
of those Partners' Share of Additional Book Basis Derivative Items for each
prior taxable period, (ii) with respect to the General Partner (as holder of the
General Partner Interest), the excess of (a) the Net Positive Adjustments of the
General Partner as of the end of such period over (b) the sum of the General
Partner's Share of Additional Book Basis Derivative Items with respect to the
General Partner Interest for each prior taxable period, and (iii) with respect
to the holders of Incentive Distribution Rights, the excess of (a) the Net
Positive Adjustments of the holders of Incentive Distribution Rights as of the
end of such period over (b) the sum of the Share of Additional Book Basis
Derivative Items of the holders of the Incentive Distribution Rights for each
prior taxable period.

         "Required Allocations" means (a) any limitation imposed on any
allocation of Net Losses or Net Termination Losses under Section 6.1(b) or
6.1(c)(ii) and (b) any allocation of an item of income, gain, loss or deduction
pursuant to Section 6.1(d)(i), 6.1(d)(ii), 6.1(d)(iv), 6.1(d)(vii) or
6.1(d)(ix).

         "Residual Gain" or "Residual Loss" means any item of gain or loss, as
the case may be, of the Partnership recognized for federal income tax purposes
resulting from a sale, exchange or other disposition of a Contributed Property
or Adjusted Property, to the extent such item of gain



                                       16
<PAGE>



or loss is not allocated pursuant to Section 6.2(b)(i)(A) or 6.2(b)(ii)(A),
respectively, to eliminate Book-Tax Disparities.

         "Second Liquidation Target Amount" has the meaning assigned to such
term in Section 6.1(c)(i)(E).

         "Second Target Distribution" means $0.625 per Unit per Quarter (or,
with respect to the period commencing on the Closing Date and ending on December
31, 2002, it means the product of $0.625 multiplied by a fraction of which the
numerator is equal to the number of days in such period and of which the
denominator is 91), subject to adjustment in accordance with Sections 6.6 and
6.9.

         "Securities Act" means the Securities Act of 1933, as amended,
supplemented or restated from time to time and any successor to such statute.

         "Share of Additional Book Basis Derivative Items" means in connection
with any allocation of Additional Book Basis Derivative Items for any taxable
period, (i) with respect to the Unitholders holding Common Units or Subordinated
Units, the amount that bears the same ratio to such Additional Book Basis
Derivative Items as the Unitholders' Remaining Net Positive Adjustments as of
the end of such period bears to the Aggregate Remaining Net Positive Adjustments
as of that time, (ii) with respect to the General Partner (as holder of the
General Partner Interest), the amount that bears the same ratio to such
additional Book Basis Derivative Items as the General Partner's Remaining Net
Positive Adjustments as of the end of such period bears to the Aggregate
Remaining Net Positive Adjustment as of that time, and (iii) with respect to the
Partners holding Incentive Distribution Rights, the amount that bears the same
ratio to such Additional Book Basis Derivative Items as the Remaining Net
Positive Adjustments of the Partners holding the Incentive Distribution Rights
as of the end of such period bears to the Aggregate Remaining Net Positive
Adjustments as of that time.

         "Special Approval" means approval by a majority of the members of the
Conflicts Committee.

         "Subordinated Unit" means a Unit representing a fractional part of the
Partnership Interests of all Limited Partners and Assignees and having the
rights and obligations specified with respect to Subordinated Units in this
Agreement. The term "Subordinated Unit" as used herein does not include a Common
Unit or Parity Unit. A Subordinated Unit that is convertible into a Common Unit
or a Parity Unit shall not constitute a Common Unit or Parity Unit until such
conversion occurs.

         "Subordination Period" means the period commencing on the Closing Date
and ending on the first to occur of the following dates:

                  (a) the first day of any Quarter beginning after September 30,
2009 in respect of which (i) (A) distributions of Available Cash from Operating
Surplus on each of the Outstanding Common Units and Subordinated Units and any
other Outstanding Units that are senior or equal in right of distribution to the
Subordinated Units with respect to each of the three consecutive,
non-overlapping four-Quarter periods immediately preceding such date equaled or
exceeded the sum of the Minimum Quarterly Distribution (or portion thereof for
the first fiscal



                                       17
<PAGE>



quarter after the Closing Date) on all Outstanding Common Units and Subordinated
Units and any other Outstanding Units that are senior or equal in right of
distribution to the Subordinated Units during such periods and (B) the Adjusted
Operating Surplus generated during each of the three consecutive,
non-overlapping four-quarter periods immediately preceding such date equaled or
exceeded the sum of the Minimum Quarterly Distribution on all of the Common
Units and Subordinated Units and any other Units that are senior or equal in
right of distribution to the Subordinated Units that were Outstanding during
such periods on a Fully Diluted Basis, plus the related distribution on the
General Partner Interest, during such periods and (ii) there are no Cumulative
Common Unit Arrearages; and

                  (b) the date on which the General Partner is removed as
general partner of the Partnership upon the requisite vote by holders of
Outstanding Units under circumstances where Cause does not exist and Units held
by the General Partner and its Affiliates are not voted in favor of such
removal.

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

         "Substituted Limited Partner" means a Person who is admitted as a
Limited Partner to the Partnership pursuant to Section 10.2 in place of and with
all the rights of a Limited Partner and who is shown as a Limited Partner on the
books and records of the Partnership.

         "Surviving Business Entity" has the meaning assigned to such term in
Section 14.2(b).

         "Third Liquidation Target Amount" has the meaning assigned to such term
in Section 6.1(c)(i)(F).

         "Third Target Distribution" means $0.75 per Unit per Quarter (or, with
respect to the period commencing on the Closing Date and ending on December 31,
2002, it means the product of $0.75 multiplied by a fraction of which the
numerator is equal to the number of days in such period and of which the
denominator is 91), subject to adjustment in accordance with Sections 6.6 and
6.9.

         "Trading Day" has the meaning assigned to such term in Section 15.1(a).

         "transfer" has the meaning assigned to such term in Section 4.4(a).



                                       18
<PAGE>



         "Transfer Agent" means such bank, trust company or other Person
(including the General Partner or one of its Affiliates) as shall be appointed
from time to time by the Partnership to act as registrar and transfer agent for
the Common Units; provided that if no Transfer Agent is specifically designated
for any other Partnership Securities, the General Partner shall act in such
capacity.

         "Transfer Application" means an application and agreement for transfer
of Units in the form set forth on the back of a Certificate or in a form
substantially to the same effect in a separate instrument.

         "Underwriter" means each Person named as an underwriter in Schedule I
to the Underwriting Agreement who purchases Common Units pursuant thereto.

         "Underwriting Agreement" means the Underwriting Agreement dated October
31, 2002 among the Underwriters, the Partnership, the General Partner, the
Operating Partnership and Martin Resource Management Corporation, providing for
the purchase of Common Units by such Underwriters.

         "Unit" means a Partnership Security that is designated as a "Unit" and
shall include Common Units and Subordinated Units but shall not include (i) a
General Partner Interest or (ii) Incentive Distribution Rights.

         "Unitholders" means the holders of Units.

         "Unit Majority" means, (x) during the Subordination Period, at least a
majority of the Outstanding Common Units (excluding Common Units owned by the
General Partner and its Affiliates) voting as a class and at least a majority of
the Outstanding Subordinated Units voting as a class, and thereafter, (y) at
least a majority of the Outstanding Common Units.

         "Unpaid MQD" has the meaning assigned to such term in Section
6.1(c)(i)(B).

         "Unrealized Gain" attributable to any item of Partnership property
means, as of any date of determination, the excess, if any, of (a) the fair
market value of such property as of such date (as determined under Section
5.5(d)) over (b) the Carrying Value of such property as of such date (prior to
any adjustment to be made pursuant to Section 5.5(d) as of such date).

         "Unrealized Loss" attributable to any item of Partnership property
means, as of any date of determination, the excess, if any, of (a) the Carrying
Value of such property as of such date (prior to any adjustment to be made
pursuant to Section 5.5(d) as of such date) over (b) the fair market value of
such property as of such date (as determined under Section 5.5(d)).

         "Unrecovered Capital" means at any time, with respect to a Unit, the
Initial Unit Price less the sum of all distributions constituting Capital
Surplus theretofore made in respect of an Initial Common Unit and any
distributions of cash (or the Net Agreed Value of any distributions in kind) in
connection with the dissolution and liquidation of the Partnership theretofore
made in respect of an Initial Common Unit, adjusted as the General Partner
determines to be appropriate to give effect to any distribution, subdivision or
combination of such Units.



                                       19
<PAGE>



         "U.S. GAAP" means United States Generally Accepted Accounting
Principles consistently applied.

         "U.S. Maritime Company" means any corporation or other entity which,
directly or indirectly (1) owns or operates vessels in the United States
coastwise trade, intercoastal trade or noncontiguous domestic trade; (2) owns or
operates any vessel built with construction differential subsidies from the
United States Government (or any agency thereof); (3) is a party to an operating
differential subsidy agreement with the United States Government (or any agency
thereof) on account of ships owned, chartered or operated by it; (4) owns any
vessel on which there is a preferred mortgage issued in connection with Title XI
of the Merchant Marine Act, 1936, as amended; (5) operates vessels under
agreement with the United States Government (or any agency thereof); (6)
conducts any activity, takes any action or receives any benefit which would be
adversely affected under any provision of the U.S. maritime, shipping or vessel
documentation laws by virtue of Non-citizen ownership of its stock; or (7)
maintains a Capital Construction Fund under the provisions of Section 607 of the
Merchant Marine Act of 1936, as amended.

         "Withdrawal Opinion of Counsel" has the meaning assigned to such term
in Section 11.1(b).

         "Working Capital Borrowings" means borrowings used solely for working
capital purposes or to pay distributions to Partners made pursuant to a credit
facility or other arrangement to the extent such borrowings are required to be
reduced to a relatively small amount each year (or for the year in which the
Initial Offering is consummated, the 12-month period beginning on the Closing
Date) for an economically meaningful period of time.

         Section 1.2 Construction. Unless the context requires otherwise: (a)
any pronoun used in this Agreement shall include the corresponding masculine,
feminine or neuter forms, and the singular form of nouns, pronouns and verbs
shall include the plural and vice versa; (b) references to Articles and Sections
refer to Articles and Sections of this Agreement; and (c) the term "include" or
"includes" means includes, without limitation, and "including" means including,
without limitation.

                                   ARTICLE II
                                  ORGANIZATION

         Section 2.1 Formation. The General Partner and the Organizational
Limited Partner have previously formed the Partnership as a limited partnership
pursuant to the provisions of the Delaware Act and hereby amend and restate the
original Agreement of Limited Partnership of Martin Midstream Partners L.P. in
its entirety. This amendment and restatement shall become effective on the date
of this Agreement. Except as expressly provided to the contrary in this
Agreement, the rights, duties (including fiduciary duties), liabilities and
obligations of the Partners and the administration, dissolution and termination
of the Partnership shall be governed by the Delaware Act. All Partnership
Interests shall constitute personal property of the owner thereof for all
purposes and a Partner has no interest in specific Partnership property.



                                       20
<PAGE>



         Section 2.2 Name. The name of the Partnership shall be "Martin
Midstream Partners L.P." The Partnership's business may be conducted under any
other name or names deemed necessary or appropriate by the General Partner in
its sole discretion, including the name of the General Partner. The words
"Limited Partnership," "L.P.," "Ltd." or similar words or letters shall be
included in the Partnership's name where necessary for the purpose of complying
with the laws of any jurisdiction that so requires. The General Partner in its
discretion may change the name of the Partnership at any time and from time to
time and shall notify the Limited Partners of such change in the next regular
communication to the Limited Partners.

         Section 2.3 Registered Office; Registered Agent; Principal Office;
Other Offices. Unless and until changed by the General Partner, the registered
office of the Partnership in the State of Delaware shall be located at 1209
Orange Street, Wilmington, Delaware 19801, and the registered agent for service
of process on the Partnership in the State of Delaware at such registered office
shall be The Corporation Trust Company. The principal office of the Partnership
shall be located at 4200 Stone Road, Kilgore, Texas 75662 or such other place as
the General Partner may from time to time designate by notice to the Limited
Partners. The Partnership may maintain offices at such other place or places
within or outside the State of Delaware as the General Partner deems necessary
or appropriate. The address of the General Partner shall be 4200 Stone Road,
Kilgore, Texas 75662 or such other place as the General Partner may from time to
time designate by notice to the Limited Partners.

         Section 2.4 Purpose and Business. The purpose and nature of the
business to be conducted by the Partnership shall be to (a) own the equity of
the general partner of the Operating Partnership and to serve as a limited
partner of the Operating Partnership and, in connection therewith, to exercise
all the rights and powers conferred upon the Partnership as a partner of the
Operating Partnership pursuant to the Operating Partnership Agreement or
otherwise, (b) engage directly in, or enter into or form any corporation,
partnership, joint venture, limited liability company or other arrangement to
engage indirectly in, any business activity that the Operating Partnership is
permitted to engage in by the Operating Partnership Agreement or that its
subsidiaries are permitted to engage in by their limited liability company or
partnership agreements and, in connection therewith, to exercise all of the
rights and powers conferred upon the Partnership pursuant to the agreements
relating to such business activity, (c) engage directly in, or enter into or
form any corporation, partnership, joint venture, limited liability company or
other arrangement to engage indirectly in, any business activity that is
approved by the General Partner and which lawfully may be conducted by a limited
partnership organized pursuant to the Delaware Act and, in connection therewith,
to exercise all of the rights and powers conferred upon the Partnership pursuant
to the agreements relating to such business activity; provided, however, that
the General Partner reasonably determines, as of the date of the acquisition or
commencement of such activity, that such activity (i) generates "qualifying
income" (as such term is defined pursuant to Section 7704 of the Code) or a
Subsidiary or a Partnership activity that generates qualifying income or (ii)
enhances the operations of an activity of the Operating Partnership, and (d) do
anything necessary or appropriate to the foregoing, including the making of
capital contributions or loans to a Group Member. The General Partner has no
obligation or duty to the Partnership, the Limited Partners or the Assignees to
propose or approve, and in its discretion may decline to propose or approve, the
conduct by the Partnership of any business.



                                       21
<PAGE>



         Section 2.5 Powers. The Partnership shall be empowered to do any and
all acts and things necessary, appropriate, proper, advisable, incidental to or
convenient for the furtherance and accomplishment of the purposes and business
described in Section 2.4 and for the protection and benefit of the Partnership.

         Section 2.6 Power of Attorney. Each Limited Partner and each Assignee
hereby constitutes and appoints the General Partner and, if a Liquidator shall
have been selected pursuant to Section 12.3, the Liquidator (and any successor
to the Liquidator by merger, transfer, assignment, election or otherwise) and
each of their authorized officers and attorneys-in-fact, as the case may be,
with full power of substitution, as his true and lawful agent and
attorney-in-fact, with full power and authority in his name, place and stead,
to:

                  (i) execute, swear to, acknowledge, deliver, file and record
         in the appropriate public offices (A) all certificates, documents and
         other instruments (including this Agreement and the Certificate of
         Limited Partnership and all amendments or restatements hereof or
         thereof) that the General Partner or the Liquidator deems necessary or
         appropriate to form, qualify or continue the existence or qualification
         of the Partnership as a limited partnership (or a partnership in which
         the limited partners have limited liability) in the State of Delaware
         and in all other jurisdictions in which the Partnership may conduct
         business or own property; (B) all certificates, documents and other
         instruments that the General Partner or the Liquidator deems necessary
         or appropriate to reflect, in accordance with its terms, any amendment,
         change, modification or restatement of this Agreement; (C) all
         certificates, documents and other instruments (including conveyances
         and a certificate of cancellation) that the General Partner or the
         Liquidator deems necessary or appropriate to reflect the dissolution
         and liquidation of the Partnership pursuant to the terms of this
         Agreement; (D) all certificates, documents and other instruments
         relating to the admission, withdrawal, removal or substitution of any
         Partner pursuant to, or other events described in, Article IV, X, XI or
         XII; (E) all certificates, documents and other instruments relating to
         the determination of the rights, preferences and privileges of any
         class or series of Partnership Securities issued pursuant to Section
         5.6; and (F) all certificates, documents and other instruments
         (including agreements and a certificate of merger) relating to a merger
         or consolidation of the Partnership pursuant to Article XIV; and

                  (ii) execute, swear to, acknowledge, deliver, file and record
         all ballots, consents, approvals, waivers, certificates, documents and
         other instruments necessary or appropriate, in the discretion of the
         General Partner or the Liquidator, to make, evidence, give, confirm or
         ratify any vote, consent, approval, agreement or other action that is
         made or given by the Partners hereunder or is consistent with the terms
         of this Agreement or is necessary or appropriate, in the discretion of
         the General Partner or the Liquidator, to effectuate the terms or
         intent of this Agreement; provided, that when required by Section 13.3
         or any other provision of this Agreement that establishes a percentage
         of the Limited Partners or of the Limited Partners of any class or
         series required to take any action, the General Partner and the
         Liquidator may exercise the power of attorney made in this Section
         2.6(a)(ii) only after the necessary vote, consent or approval of the
         Limited Partners or of the Limited Partners of such class or series, as
         applicable.



                                       22
<PAGE>



Nothing contained in this Section 2.6(a) shall be construed as authorizing the
General Partner to amend this Agreement except in accordance with Article XIII
or as may be otherwise expressly provided for in this Agreement.

         (b) The foregoing power of attorney is hereby declared to be
irrevocable and a power coupled with an interest, and it shall survive and, to
the maximum extent permitted by law, not be affected by the subsequent death,
incompetency, disability, incapacity, dissolution, bankruptcy or termination of
any Limited Partner or Assignee and the transfer of all or any portion of such
Limited Partner's or Assignee's Partnership Interest and shall extend to such
Limited Partner's or Assignee's heirs, successors, assigns and personal
representatives. Each Limited Partner or Assignee hereby agrees to be bound by
any representation made by the General Partner or the Liquidator acting in good
faith pursuant to such power of attorney; and each Limited Partner or Assignee
hereby waives, to the maximum extent permitted by law, any and all defenses that
may be available to contest, negate or disaffirm the action of the General
Partner or the Liquidator taken in good faith under such power of attorney. Each
Limited Partner or Assignee shall execute and deliver to the General Partner or
the Liquidator, within 15 days after receipt of the request therefor, such
further designation, powers of attorney and other instruments as the General
Partner or the Liquidator deems necessary to effectuate this Agreement and the
purposes of the Partnership.

         Section 2.7 Term. The term of the Partnership commenced upon the filing
of the Certificate of Limited Partnership in accordance with the Delaware Act
and shall continue in existence until the dissolution of the Partnership in
accordance with the provisions of Article XII. The existence of the Partnership
as a separate legal entity shall continue until the cancellation of the
Certificate of Limited Partnership as provided in the Delaware Act.

         Section 2.8 Title to Partnership Assets. Title to Partnership assets,
whether real, personal or mixed and whether tangible or intangible, shall be
deemed to be owned by the Partnership as an entity, and no Partner or Assignee,
individually or collectively, shall have any ownership interest in such
Partnership assets or any portion thereof. Title to any or all of the
Partnership assets may be held in the name of the Partnership, the General
Partner, one or more of its Affiliates or one or more nominees, as the General
Partner may determine. The General Partner hereby declares and warrants that any
Partnership assets for which record title is held in the name of the General
Partner or one or more of its Affiliates or one or more nominees shall be held
by the General Partner or such Affiliate or nominee for the use and benefit of
the Partnership in accordance with the provisions of this Agreement; provided,
however, that the General Partner shall use reasonable efforts to cause record
title to such assets (other than those assets in respect of which the General
Partner determines that the expense and difficulty of conveyancing makes
transfer of record title to the Partnership impracticable) to be vested in the
Partnership as soon as reasonably practicable; provided, further, that, prior to
the withdrawal or removal of the General Partner or as soon thereafter as
practicable, the General Partner shall use reasonable efforts to effect the
transfer of record title to the Partnership and, prior to any such transfer,
will provide for the use of such assets in a manner satisfactory to the General
Partner. All Partnership assets shall be recorded as the property of the
Partnership in its books and records, irrespective of the name in which record
title to such Partnership assets is held.



                                       23
<PAGE>



                                   ARTICLE III
                           RIGHTS OF LIMITED PARTNERS

         Section 3.1 Limitation of Liability. The Limited Partners and the
Assignees shall have no liability under this Agreement except as expressly
provided in this Agreement or the Delaware Act.

         Section 3.2 Management of Business. No Limited Partner or Assignee, in
its capacity as such, shall participate in the operation, management or control
(within the meaning of the Delaware Act) of the Partnership's business, transact
any business in the Partnership's name or have the power to sign documents for
or otherwise bind the Partnership. Any action taken by any Affiliate of the
General Partner or any officer, director, employee, manager, member, general
partner, agent or trustee of the General Partner or any of its Affiliates, or
any officer, director, employee, manager, member, general partner, agent or
trustee of a Group Member, in its capacity as such, shall not be deemed to be
participation in the control of the business of the Partnership by a limited
partner of the Partnership (within the meaning of Section 17-303(a) of the
Delaware Act) and shall not affect, impair or eliminate the limitations on the
liability of the Limited Partners or Assignees under this Agreement.

         Section 3.3 Outside Activities of the Limited Partners. Subject to the
provisions of Section 7.5 and the Omnibus Agreement, which shall continue to be
applicable to the Persons referred to therein, regardless of whether such
Persons shall also be Limited Partners or Assignees, any Limited Partner or
Assignee shall be entitled to and may have business interests and engage in
business activities in addition to those relating to the Partnership, including
business interests and activities in direct competition with the Partnership
Group. Neither the Partnership nor any of the other Partners or Assignees shall
have any rights by virtue of this Agreement in any business ventures of any
Limited Partner or Assignee.

         Section 3.4 Rights of Limited Partners. In addition to other rights
provided by this Agreement or by applicable law, and except as limited by
Section 3.4(b), each Limited Partner shall have the right, for a purpose
reasonably related to such Limited Partner's interest as a limited partner in
the Partnership, upon reasonable written demand and at such Limited Partner's
own expense:

                  (i) to obtain true and full information regarding the status
         of the business and financial condition of the Partnership;

                  (ii) promptly after becoming available, to obtain a copy of
         the Partnership's federal, state and local income tax returns for each
         year;

                  (iii) to have furnished to him a current list of the name and
         last known business, residence or mailing address of each Partner;

                  (iv) to have furnished to him a copy of this Agreement and the
         Certificate of Limited Partnership and all amendments thereto, together
         with a copy of the executed copies of all powers of attorney pursuant
         to which this Agreement, the Certificate of Limited Partnership and all
         amendments thereto have been executed;



                                       24
<PAGE>



                  (v) to obtain true and full information regarding the amount
         of cash and a description and statement of the Net Agreed Value of any
         other Capital Contribution by each Partner and which each Partner has
         agreed to contribute in the future, and the date on which each became a
         Partner; and

                  (vi) to obtain such other information regarding the affairs of
         the Partnership as is just and reasonable.

         (b) The General Partner may keep confidential from the Limited Partners
and Assignees, for such period of time as the General Partner deems reasonable,
(i) any information that the General Partner reasonably believes to be in the
nature of trade secrets or (ii) other information the disclosure of which the
General Partner in good faith believes (A) is not in the best interests of the
Partnership Group, (B) could damage the Partnership Group or (C) that any Group
Member is required by law or by agreement with any third party to keep
confidential (other than agreements with Affiliates of the Partnership the
primary purpose of which is to circumvent the obligations set forth in this
Section 3.4).

                                   ARTICLE IV
        CERTIFICATES; RECORD HOLDERS; TRANSFER OF PARTNERSHIP INTERESTS;
                       REDEMPTION OF PARTNERSHIP INTERESTS

         Section 4.1 Certificates. Upon the Partnership's issuance of Common
Units or Subordinated Units to any Person and upon such Person's request, the
Partnership shall issue one or more Certificates in the name of such Person
evidencing the number of such Units being so issued. In addition, (a) upon the
General Partner's request, the Partnership shall issue to it one or more
Certificates in the name of the General Partner evidencing its interests in the
Partnership and (b) upon the request of any Person owning Incentive Distribution
Rights or any other Partnership Securities other than Common Units or
Subordinated Units, the Partnership shall issue to such Person one or more
certificates evidencing such Incentive Distribution Rights or other Partnership
Securities other than Common Units or Subordinated Units. Certificates shall be
executed on behalf of the Partnership by the Chairman of the Board, President or
any Vice President and the Secretary or any Assistant Secretary of the General
Partner. No Common Unit Certificate shall be valid for any purpose until it has
been countersigned by the Transfer Agent; provided, however, that if the General
Partner elects to issue Common Units in global form, the Common Unit
Certificates shall be valid upon receipt of a certificate from the Transfer
Agent certifying that the Common Units have been duly registered in accordance
with the directions of the Partnership and the Underwriters. Subject to the
requirements of Section 6.7(b), the Partners holding Certificates evidencing
Subordinated Units may exchange such Certificates for Certificates evidencing
Common Units on or after the date on which such Subordinated Units are converted
into Common Units pursuant to the terms of Section 5.8.

         Section 4.2 Mutilated, Destroyed, Lost or Stolen Certificates.

         (a) If any mutilated Certificate is surrendered to the Transfer Agent,
the appropriate officers of the General Partner on behalf of the Partnership
shall execute, and the Transfer Agent shall countersign and deliver in exchange
therefor, a new Certificate evidencing the same number and type of Partnership
Securities as the Certificate so surrendered.



                                       25
<PAGE>



         (b) The appropriate officers of the General Partner on behalf of the
Partnership shall execute and deliver, and the Transfer Agent shall countersign
a new Certificate in place of any Certificate previously issued if the Record
Holder of the Certificate:

                  (i) makes proof by affidavit, in form and substance
         satisfactory to the General Partner, that a previously issued
         Certificate has been lost, destroyed or stolen;

                  (ii) requests the issuance of a new Certificate before the
         General Partner has notice that the Certificate has been acquired by a
         purchaser for value in good faith and without notice of an adverse
         claim;

                  (iii) if requested by the General Partner, delivers to the
         General Partner a bond, in form and substance satisfactory to the
         General Partner, with surety or sureties and with fixed or open penalty
         as the General Partner may reasonably direct, in its sole discretion,
         to indemnify the Partnership, the Partners, the General Partner and the
         Transfer Agent against any claim that may be made on account of the
         alleged loss, destruction or theft of the Certificate; and

                  (iv) satisfies any other reasonable requirements imposed by
         the General Partner.

         If a Limited Partner or Assignee fails to notify the General Partner
within a reasonable time after he has notice of the loss, destruction or theft
of a Certificate, and a transfer of the Limited Partner Interests represented by
the Certificate is registered before the Partnership, the General Partner or the
Transfer Agent receives such notification, the Limited Partner or Assignee shall
be precluded from making any claim against the Partnership, the General Partner
or the Transfer Agent for such transfer or for a new Certificate.

         (c) As a condition to the issuance of any new Certificate under this
Section 4.2, the General Partner may require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the Transfer
Agent) reasonably connected therewith.

         Section 4.3 Record Holders. The Partnership shall be entitled to
recognize the Record Holder as the Partner or Assignee with respect to any
Partnership Interest and, accordingly, shall not be bound to recognize any
equitable or other claim to or interest in such Partnership Interest on the part
of any other Person, regardless of whether the Partnership shall have actual or
other notice thereof, except as otherwise provided by law or any applicable
rule, regulation, guideline or requirement of any National Securities Exchange
on which such Partnership Interests are listed for trading. Without limiting the
foregoing, when a Person (such as a broker, dealer, bank, trust company or
clearing corporation or an agent of any of the foregoing) is acting as nominee,
agent or in some other representative capacity for another Person in acquiring
and/or holding Partnership Interests, as between the Partnership on the one
hand, and such other Persons on the other, such representative Person (a) shall
be the Partner or Assignee (as the case may be) of record and beneficially, (b)
must execute and deliver a Transfer Application and (c) shall be bound by this
Agreement and shall have the rights and obligations of a Partner or Assignee (as
the case may be) hereunder and as, and to the extent, provided for herein.



                                       26
<PAGE>



         Section 4.4 Transfer Generally.

         (a) The term "transfer," when used in this Agreement with respect to a
Partnership Interest, shall be deemed to refer to a transaction by which the
General Partner assigns its General Partner Interest to another Person who
becomes the general partner of the Partnership, by which the holder of a Limited
Partner Interest assigns such Limited Partner Interest to another Person who is
or becomes a Limited Partner or an Assignee, and includes a sale, assignment,
gift, pledge, encumbrance, hypothecation, mortgage, exchange or any other
disposition by law or otherwise.

         (b) No Partnership Interest shall be transferred, in whole or in part,
except in accordance with the terms and conditions set forth in this Article IV.
Any transfer or purported transfer of a Partnership Interest not made in
accordance with this Article IV shall be null and void.

         (c) Nothing contained in this Agreement shall be construed to prevent a
disposition by any member of the General Partner of any or all of the membership
interests of the General Partner.

         Section 4.5 Registration and Transfer of Limited Partner Interests.

         (a) The Partnership shall keep or cause to be kept on behalf of the
Partnership a register in which, subject to such reasonable regulations as it
may prescribe and subject to the provisions of Section 4.5(b), the Partnership
will provide for the registration and transfer of Limited Partner Interests. The
Transfer Agent is hereby appointed registrar and transfer agent for the purpose
of registering Common Units and transfers of such Common Units as herein
provided. The Partnership shall not recognize transfers of Certificates
evidencing Limited Partner Interests unless such transfers are effected in the
manner described in this Section 4.5. Upon surrender of a Certificate for
registration of transfer of any Limited Partner Interests evidenced by a
Certificate, and subject to the provisions of Section 4.5(b), the appropriate
officers of the General Partner on behalf of the Partnership shall execute and
deliver, and in the case of Common Units, the Transfer Agent shall countersign
and deliver, in the name of the holder or the designated transferee or
transferees, as required pursuant to the holder's instructions, one or more new
Certificates evidencing the same aggregate number and type of Limited Partner
Interests as was evidenced by the Certificate so surrendered.

         (b) Except as otherwise provided in Section 4.9, the Partnership shall
not recognize any transfer of Limited Partner Interests evidenced by a
Certificate until the Certificates evidencing such Limited Partner Interests are
surrendered for registration of transfer and such Certificates are accompanied
by a Transfer Application duly executed by the transferee (or the transferee's
attorney-in-fact duly authorized in writing). No charge shall be imposed by the
Partnership for such transfer; provided, that as a condition to the issuance of
any new Certificate under this Section 4.5, the Partnership may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed with respect thereto.



                                       27
<PAGE>



         (c) Limited Partner Interests may be transferred only in the manner
described in this Section 4.5. The transfer of any Limited Partner Interests and
the admission of any new Limited Partner shall not constitute an amendment to
this Agreement.

         (d) Until admitted as a Substituted Limited Partner pursuant to Section
10.2, the Record Holder of a Limited Partner Interest shall be an Assignee in
respect of such Limited Partner Interest. Limited Partners may include
custodians, nominees or any other individual or entity in its own or any
representative capacity.

         (e) A transferee of a Limited Partner Interest who has completed and
delivered a Transfer Application shall be deemed to have (i) requested admission
as a Substituted Limited Partner, (ii) agreed to comply with and be bound by and
to have executed this Agreement, (iii) represented and warranted that such
transferee has the right, power and authority and, if an individual, the
capacity to enter into this Agreement, (iv) granted the powers of attorney set
forth in this Agreement and (v) given the consents and approvals and made the
waivers contained in this Agreement.

         (f) The General Partner and its Affiliates shall have the right at any
time to transfer their Subordinated Units and Common Units (whether issued upon
conversion of the Subordinated Units or otherwise) to one or more Persons.

         Section 4.6 Transfer of the General Partner's General Partner Interest.

         (a) Subject to Section 4.6(c) below, prior to September 30, 2012, the
General Partner shall not transfer all or any part of its General Partner
Interest to a Person unless such transfer (i) has been approved by the prior
written consent or vote of the holders of at least a majority of the Outstanding
Common Units (excluding Common Units held by the General Partner and its
Affiliates) or (ii) is of all, but not less than all, of its General Partner
Interest to (A) an Affiliate of the General Partner (other than an individual)
or (B) another Person (other than an individual) in connection with the merger
or consolidation of the General Partner with or into another Person (other than
an individual) or the transfer by the General Partner of all or substantially
all of its assets to another Person (other than an individual).

         (b) Subject to Section 4.6(c) below, on or after September 30, 2012,
the General Partner may transfer all or any of its General Partner Interest
without Unitholder approval.

         (c) Notwithstanding anything herein to the contrary, no transfer by the
General Partner of all or any part of its General Partner Interest to another
Person shall be permitted unless (i) the transferee agrees to assume the rights
and duties of the General Partner under this Agreement and to be bound by the
provisions of this Agreement, (ii) the Partnership receives an Opinion of
Counsel that such transfer would not result in the loss of limited liability of
any Limited Partner or of any limited partner of the Operating Partnership or
cause the Partnership or the Operating Partnership to be treated as an
association taxable as a corporation or otherwise to be taxed as an entity for
federal income tax purposes (to the extent not already so treated or taxed) and
(iii) such transferee also agrees to purchase all (or the appropriate portion
thereof, if applicable) of the partnership or membership interest of the General
Partner as the general partner or managing member, if any, of each other Group
Member. In the case of a transfer



                                       28
<PAGE>



pursuant to and in compliance with this Section 4.6, the transferee or successor
(as the case may be) shall, subject to compliance with the terms of Section
10.3, be admitted to the Partnership as the General Partner immediately prior to
the transfer of the Partnership Interest, and the business of the Partnership
shall continue without dissolution.

         Section 4.7 Transfer of Incentive Distribution Rights. Prior to
September 30, 2012, a holder of Incentive Distribution Rights may transfer any
or all of the Incentive Distribution Rights held by such holder without any
consent of the Unitholders (a) to an Affiliate of such holder (other than an
individual) or (b) to another Person (other than an individual) in connection
with (i) the merger or consolidation of such holder of Incentive Distribution
Rights with or into such other Person or (ii) the transfer by such holder of all
or substantially all of its assets to such other Person or (iii) the sale of all
or substantially all of the equity interests of such holder to such other
Person. Any other transfer of the Incentive Distribution Rights prior to
September 30, 2012, shall require the prior approval of holders of at least a
majority of the Outstanding Common Units (excluding Common Units held by the
General Partner and its Affiliates). On or after September 30, 2012, any holder
of Incentive Distribution Rights may transfer any or all of its Incentive
Distribution Rights without Unitholder approval. Notwithstanding anything herein
to the contrary, no transfer of Incentive Distribution Rights to another Person
shall be permitted unless the transferee agrees to be bound by the provisions of
this Agreement.

         Section 4.8 Restrictions on Transfers.

         (a) Except as provided in Section 4.8(d) below, but notwithstanding the
other provisions of this Article IV, no transfer of any Partnership Interests
shall be made if such transfer would (i) violate the then applicable federal or
state securities laws or rules and regulations of the Commission, any state
securities commission or any other governmental authority with jurisdiction over
such transfer, (ii) terminate the existence or qualification of the Partnership
or the Operating Partnership under the laws of the jurisdiction of its
formation, or (iii) cause the Partnership or the Operating Partnership to be
treated as an association taxable as a corporation or otherwise to be taxed as
an entity for federal income tax purposes (to the extent not already so treated
or taxed).

         (b) The General Partner may impose restrictions on the transfer of
Partnership Interests if a subsequent Opinion of Counsel determines that such
restrictions are necessary to avoid a significant risk of the Partnership or the
Operating Partnership becoming an association taxable as a corporation or
otherwise to be taxed as an entity for federal income tax purposes. The
restrictions may be imposed by making such amendments to this Agreement as the
General Partner may determine to be necessary or appropriate to impose such
restrictions; provided, however, that any amendment that the General Partner
believes, in the exercise of its reasonable discretion, could result in the
delisting or suspension of trading of any class of Limited Partner Interests on
the principal National Securities Exchange on which such class of Limited
Partner Interests is then traded must be approved, prior to such amendment being
effected, by the holders of at least a majority of the Outstanding Limited
Partner Interests of such class.

         (c) The transfer of a Subordinated Unit that has converted into a
Common Unit shall be subject to the restrictions imposed by Section 6.7(b).



                                       29
<PAGE>



         (d) Nothing contained in this Article IV, or elsewhere in this
Agreement, shall preclude the settlement of any transactions involving
Partnership Interests entered into through the facilities of any National
Securities Exchange on which such Partnership Interests are listed for trading.

         Section 4.9 Citizenship Certificates; Non-citizen Assignees.

         (a) If any Group Member is or becomes subject to any federal, state or
local law or regulation that, in the reasonable determination of the General
Partner, creates (i) a substantial risk of cancellation or forfeiture of any
property in which the Group Member has an interest based on the nationality,
citizenship or other related status of a Limited Partner or Assignee or (ii) a
substantial risk that one or more Group Member or any Controlled Person of a
Group Member will not be permitted to conduct business as a U.S. Maritime
Company based on the status of a Limited Partner or Assignee as a Non-citizen,
the General Partner may request any Limited Partner or Assignee to furnish to
the General Partner, within 30 days after receipt of such request, an executed
Citizenship Certification or such other information concerning his nationality,
citizenship or other related status (or, if the Limited Partner or Assignee is a
nominee holding for the account of another Person, the nationality, citizenship
or other related status of such Person) as the General Partner may request. If a
Limited Partner or Assignee fails to furnish to the General Partner within the
aforementioned 30-day period such Citizenship Certification or other requested
information or if upon receipt of such Citizenship Certification or other
requested information the General Partner determines, with the advice of
counsel, that a Limited Partner or Assignee is not an Eligible Citizen, the
Partnership Interests owned by such Limited Partner or Assignee shall be subject
to redemption in accordance with the provisions of Section 4.10. In addition,
the General Partner may require that the status of any such Partner or Assignee
be changed to that of a Non-citizen Assignee and, thereupon, the General Partner
shall be substituted for such Non-citizen Assignee as the Limited Partner in
respect of his Limited Partner Interests.

         (b) The General Partner shall, in exercising voting rights in respect
of Limited Partner Interests held by it on behalf of Non-citizen Assignees,
distribute the votes in the same ratios as the votes of Partners (including
without limitation the General Partner) in respect of Limited Partner Interests
other than those of Non-citizen Assignees are cast, either for, against or
abstaining as to the matter.

         (c) Upon dissolution of the Partnership, a Non-citizen Assignee shall
have no right to receive a distribution in kind pursuant to Section 12.4 but
shall be entitled to the cash equivalent thereof, and the Partnership shall
provide cash in exchange for an assignment of the Non-citizen Assignee's share
of the distribution in kind. Such payment and assignment shall be treated for
Partnership purposes as a purchase by the Partnership from the Non-citizen
Assignee of his Limited Partner Interest (representing his right to receive his
share of such distribution in kind).

         (d) At any time after he can and does certify that he has become an
Eligible Citizen, a Non-citizen Assignee may, upon application to the General
Partner, request admission as a Substituted Limited Partner with respect to any
Limited Partner Interests of such Non-citizen Assignee not redeemed pursuant to
Section 4.10, and upon his admission pursuant to



                                       30
<PAGE>



Section 10.2, the General Partner shall cease to be deemed to be the Limited
Partner in respect of the Non-citizen Assignee's Limited Partner Interests.

         Section 4.10 Redemption of Partnership Interests of Non-citizen
Assignees.

         (a) If at any time a Limited Partner or Assignee fails to furnish a
Citizenship Certification or other information requested within the 30-day
period specified in Section 4.9(a), or if upon receipt of such Citizenship
Certification or other information the General Partner determines, with the
advice of counsel, that a Limited Partner or Assignee is not an Eligible
Citizen, the Partnership may, unless the Limited Partner or Assignee establishes
to the satisfaction of the General Partner that such Limited Partner or Assignee
is an Eligible Citizen or has transferred his Partnership Interests to a Person
who is an Eligible Citizen and who furnishes a Citizenship Certification to the
General Partner prior to the date fixed for redemption as provided below, redeem
the Partnership Interest of such Limited Partner or Assignee as follows:

                  (i) The General Partner shall, not later than the 30th day
         before the date fixed for redemption, give notice of redemption to the
         Limited Partner or Assignee, at his last address designated on the
         records of the Partnership or the Transfer Agent, by registered or
         certified mail, postage prepaid. The notice shall be deemed to have
         been given when so mailed. The notice shall specify the Redeemable
         Interests, the date fixed for redemption, the place of payment, that
         (if applicable) payment of the redemption price will be made upon
         surrender of the Certificate evidencing the Redeemable Interests and
         that on and after the date fixed for redemption no further allocations
         or distributions to which the Limited Partner or Assignee would
         otherwise be entitled in respect of the Redeemable Interests will
         accrue or be made.

                  (ii) The aggregate redemption price for Redeemable Interests
         shall be an amount equal to the Current Market Price (the date of
         determination of which shall be the date fixed for redemption) of
         Limited Partner Interests of the class to be so redeemed multiplied by
         the number of Limited Partner Interests of each such class included
         among the Redeemable Interests. The redemption price shall be paid, in
         the discretion of the General Partner, in cash or by delivery of a
         promissory note of the Partnership in the principal amount of the
         redemption price, bearing interest at the rate of 10% annually and
         payable in three equal annual installments of principal together with
         accrued interest, commencing one year after the redemption date.

                  (iii) Upon surrender by or on behalf of the Limited Partner or
         Assignee, at the place specified in the notice of redemption, of the
         Certificate evidencing the Redeemable Interests, duly endorsed in blank
         or accompanied by an assignment duly executed in blank, the Limited
         Partner or Assignee or his duly authorized representative shall be
         entitled to receive the payment therefor.

                  (iv) After the redemption date, Redeemable Interests shall no
         longer constitute issued and Outstanding Limited Partner Interests.



                                       31
<PAGE>



         (b) The provisions of this Section 4.10 shall also be applicable to
Limited Partner Interests held by a Limited Partner or Assignee as nominee of a
Person determined to be other than an Eligible Citizen.

         (c) Nothing in this Section 4.10 shall prevent the recipient of a
notice of redemption from transferring his Limited Partner Interest before the
redemption date if such transfer is otherwise permitted under this Agreement.
Upon receipt of notice of such a transfer, the General Partner shall withdraw
the notice of redemption, provided the transferee of such Limited Partner
Interest certifies to the satisfaction of the General Partner in a Citizenship
Certification delivered in connection with the Transfer Application that he is
an Eligible Citizen. If the transferee fails to make such certification, such
redemption shall be effected from the transferee on the original redemption
date.

                                    ARTICLE V
           CAPITAL CONTRIBUTIONS AND ISSUANCE OF PARTNERSHIP INTERESTS

         Section 5.1 Organizational Contributions. In connection with the
formation of the Partnership under the Delaware Act, the General Partner made an
initial Capital Contribution to the Partnership in the amount of $20.00, for a
2% General Partner Interest in the Partnership and has been admitted as a
General Partner of the Partnership, and the Organizational Limited Partner made
an initial Capital Contribution to the Partnership in the amount of $980.00 for
a 98% Limited Partner Interest in the Partnership and has been admitted as a
Limited Partner of the Partnership. As of the Closing Date, the interest of the
Organizational Limited Partner shall be redeemed as provided in the Contribution
Agreement; the initial Capital Contributions of each Partner shall thereupon be
refunded; and the Organizational Limited Partner shall cease to be a Limited
Partner of the Partnership. Ninety-eight percent of any interest or other profit
that may have resulted from the investment or other use of such initial Capital
Contributions shall be allocated and distributed to the Organizational Limited
Partner, and the balance thereof shall be allocated and distributed to the
General Partner.

         Section 5.2 Contributions by the General Partner and its Affiliates.

         (a) On the Closing Date and pursuant to the Contribution Agreement, and
in consideration of the assumption of the debt as set forth in Section 3.1(b) of
the Contribution Agreement, (i) the General Partner shall contribute to the
Partnership, as a Capital Contribution, all of its interest in the Operating
Partnership in exchange for (A) the continuation of its General Partner
Interest, subject to all of the rights, privileges and duties of the General
Partner under this Agreement, and (B) the Incentive Distribution Rights, (ii)
the Organizational Limited Partner shall contribute to the Partnership its
limited partner interest in the Operating Partnership and all of its interest in
Martin Operating GP LLC, as a Capital Contribution, in exchange for 2,088,921
Subordinated Units, (iii) Midstream Fuel Service LLC shall contribute its
limited partner interest in the Operating Partnership, as a Capital
Contribution, in exchange for 620,644 Subordinated Units, and (iv) Martin Gas
Sales LLC will contribute its limited partner interest in the Operating
Partnership, as a Capital Contribution, in exchange for 1,543,797 Subordinated
Units.

         (b) Upon the issuance of any additional Limited Partner Interests by
the Partnership (other than the issuance of the Common Units issued in the
Initial Offering and other than the



                                       32
<PAGE>



issuance of the Common Units issued pursuant to the Over-Allotment Option and
other than Common Units purchased by the General Partner to the extent the
Over-Allotment Option is not exercised), the General Partner shall be required
to make additional Capital Contributions equal to 2/98ths of any amount
contributed to the Partnership by the Limited Partners in exchange for such
additional Limited Partner Interests. Except as set forth in the immediately
preceding sentence and Article XII, the General Partner shall not be obligated
to make any additional Capital Contributions to the Partnership.

         (c) The General Partner shall make additional Capital Contributions
equal to the amount of any loss or deduction allocated to it pursuant to Section
6.1(d)(xiii) no later than [o] days after the date on which such loss or
deduction is realized.

         Section 5.3 Contributions by Initial Limited Partners and Distributions
to the General Partner.

         (a) On the Closing Date and pursuant to the Underwriting Agreement,
each Underwriter shall contribute to the Partnership cash in an amount equal to
the Issue Price per Initial Common Unit, multiplied by the number of Common
Units specified in the Underwriting Agreement to be purchased by such
Underwriter at the Closing Date. In exchange for such Capital Contributions by
the Underwriters, the Partnership shall issue Common Units to each Underwriter
on whose behalf such Capital Contribution is made in an amount equal to the
quotient obtained by dividing (i) the cash contribution to the Partnership by or
on behalf of such Underwriter by (ii) the Issue Price per Initial Common Unit.

         (b) Upon the exercise of the Over-Allotment Option and pursuant to the
Underwriting Agreement, each Underwriter shall contribute to the Partnership
cash in an amount equal to the Issue Price per Initial Common Unit, multiplied
by the number of Common Units specified in the Underwriting Agreement to be
purchased by such Underwriter at the Option Closing Date. In exchange for such
Capital Contributions by the Underwriters, the Partnership shall issue Common
Units to each Underwriter on whose behalf such Capital Contribution is made in
an amount equal to the quotient obtained by dividing (i) the cash contributions
to the Partnership by or on behalf of such Underwriter by (ii) the Issue Price
per Initial Common Unit.

         (c) No Limited Partner Interests will be issued or issuable as of or at
the Closing Date other than (i) the Common Units issuable pursuant to
subparagraph (a) hereof in aggregate number equal to 2,900,000, (ii) the
"Additional Units" as such term is used in the Underwriting Agreement in an
aggregate number up to 435,000 issuable upon exercise of the Over-Allotment
Option pursuant to subparagraph (b) hereof, (iii) the 4,253,362 Subordinated
Units issuable to the Martin Resource Management Corporation and its Affiliates
pursuant to Section 5.2 hereof, and (iv) the Incentive Distribution Rights.

         Section 5.4 Interest and Withdrawal. No interest shall be paid by the
Partnership on Capital Contributions. No Partner or Assignee shall be entitled
to the withdrawal or return of its Capital Contribution, except to the extent,
if any, that distributions made pursuant to this Agreement or upon termination
of the Partnership may be considered as such by law and then only to the extent
provided for in this Agreement. Except to the extent expressly provided in this
Agreement, no Partner or Assignee shall have priority over any other Partner or
Assignee either



                                       33
<PAGE>



as to the return of Capital Contributions or as to profits, losses or
distributions. Any such return shall be a compromise to which all Partners and
Assignees agree within the meaning of Section 17-502(b) of the Delaware Act.

         Section 5.5 Capital Accounts.

         (a) The Partnership shall maintain for each Partner (or a beneficial
owner of Partnership Interests held by a nominee in any case in which the
nominee has furnished the identity of such owner to the Partnership in
accordance with Section 6031(c) of the Code or any other method acceptable to
the General Partner in its sole discretion) owning a Partnership Interest a
separate Capital Account with respect to such Partnership Interest in accordance
with the rules of Treasury Regulation Section 1.704-1(b)(2)(iv). Such Capital
Account shall be increased by (i) the amount of all Capital Contributions made
to the Partnership with respect to such Partnership Interest pursuant to this
Agreement and (ii) all items of Partnership income and gain (including, without
limitation, income and gain exempt from tax) computed in accordance with Section
5.5(b) and allocated with respect to such Partnership Interest pursuant to
Section 6.1, and decreased by (x) the amount of cash or Net Agreed Value of all
actual and deemed distributions of cash or property made with respect to such
Partnership Interest pursuant to this Agreement and (y) all items of Partnership
deduction and loss computed in accordance with Section 5.5(b) and allocated with
respect to such Partnership Interest pursuant to Section 6.1.

         (b) For purposes of computing the amount of any item of income, gain,
loss or deduction which is to be allocated pursuant to Article VI and is to be
reflected in the Partners' Capital Accounts, the determination, recognition and
classification of any such item shall be the same as its determination,
recognition and classification for federal income tax purposes (including,
without limitation, any method of depreciation, cost recovery or amortization
used for that purpose), provided, that:

                  (i) Solely for purposes of this Section 5.5, the Partnership
         shall be treated as owning directly its proportionate share (as
         determined by the General Partner based upon the provisions of the
         Operating Partnership Agreement) of all property owned by the Operating
         Partnership or any other Subsidiary that is classified as a partnership
         for federal income tax purposes.

                  (ii) All fees and other expenses incurred by the Partnership
         to promote the sale of (or to sell) a Partnership Interest that can
         neither be deducted nor amortized under Section 709 of the Code, if
         any, shall, for purposes of Capital Account maintenance, be treated as
         an item of deduction at the time such fees and other expenses are
         incurred and shall be allocated among the Partners pursuant to Section
         6.1.

                  (iii) Except as otherwise provided in Treasury Regulation
         Section 1.704-1(b)(2)(iv)(m), the computation of all items of income,
         gain, loss and deduction shall be made without regard to any election
         under Section 754 of the Code which may be made by the Partnership and,
         as to those items described in Section 705(a)(1)(B) or 705(a)(2)(B) of
         the Code, without regard to the fact that such items are not includable
         in gross income or are neither currently deductible nor capitalized for
         federal income tax



                                       34
<PAGE>



         purposes. To the extent an adjustment to the adjusted tax basis of any
         Partnership asset pursuant to Section 734(b) or 743(b) of the Code is
         required, pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(m),
         to be taken into account in determining Capital Accounts, the amount of
         such adjustment in the Capital Accounts shall be treated as an item of
         gain or loss.

                  (iv) Any income, gain or loss attributable to the taxable
         disposition of any Partnership property shall be determined as if the
         adjusted basis of such property as of such date of disposition were
         equal in amount to the Partnership's Carrying Value with respect to
         such property as of such date.

                  (v) In accordance with the requirements of Section 704(b) of
         the Code, any deductions for depreciation, cost recovery or
         amortization attributable to any Contributed Property shall be
         determined as if the adjusted basis of such property on the date it was
         acquired by the Partnership were equal to the Agreed Value of such
         property. Upon an adjustment pursuant to Section 5.5(d) to the Carrying
         Value of any Partnership property subject to depreciation, cost
         recovery or amortization, any further deductions for such depreciation,
         cost recovery or amortization attributable to such property shall be
         determined (A) as if the adjusted basis of such property were equal to
         the Carrying Value of such property immediately following such
         adjustment and (B) using a rate of depreciation, cost recovery or
         amortization derived from the same method and useful life (or, if
         applicable, the remaining useful life) as is applied for federal income
         tax purposes; provided, however, that, if the asset has a zero adjusted
         basis for federal income tax purposes, depreciation, cost recovery or
         amortization deductions shall be determined using any reasonable method
         that the General Partner may adopt.

                  (vi) If the Partnership's adjusted basis in a depreciable or
         cost recovery property is reduced for federal income tax purposes
         pursuant to Section 48(q)(1) or 48(q)(3) of the Code, the amount of
         such reduction shall, solely for purposes hereof, be deemed to be an
         additional depreciation or cost recovery deduction in the year such
         property is placed in service and shall be allocated among the Partners
         pursuant to Section 6.1. Any restoration of such basis pursuant to
         Section 48(q)(2) of the Code shall, to the extent possible, be
         allocated in the same manner to the Partners to whom such deemed
         deduction was allocated.

         (c) (i) A transferee of a Partnership Interest shall succeed to a pro
rata portion of the Capital Account of the transferor relating to the
Partnership Interest so transferred.

                  (ii) Immediately prior to the transfer of a Subordinated Unit
         or of a Subordinated Unit that has converted into a Common Unit
         pursuant to Section 5.8 by a holder thereof (other than a transfer to
         an Affiliate unless the General Partner elects to have this
         subparagraph 5.5(c)(ii) apply), the Capital Account maintained for such
         Person with respect to its Subordinated Units or converted Subordinated
         Units will (A) first, be allocated to the Subordinated Units or
         converted Subordinated Units to be transferred in an amount equal to
         the product of (x) the number of such Subordinated Units or converted
         Subordinated Units to be transferred and (y) the Per Unit Capital
         Amount for a Common Unit, and (B) second, any remaining balance in such
         Capital Account will be



                                       35
<PAGE>



         retained by the transferor, regardless of whether it has retained any
         Subordinated Units or converted Subordinated Units. Following any such
         allocation, the transferor's Capital Account, if any, maintained with
         respect to the retained Subordinated Units or converted Subordinated
         Units, if any, will have a balance equal to the amount allocated under
         clause (B) hereinabove, and the transferee's Capital Account
         established with respect to the transferred Subordinated Units or
         converted Subordinated Units will have a balance equal to the amount
         allocated under clause (A) hereinabove.

         (d) (i) In accordance with Treasury Regulation Section
1.704-1(b)(2)(iv)(f), on an issuance of additional Partnership Interests for
cash or Contributed Property or the conversion of the General Partner's Combined
Interest to Common Units pursuant to Section 11.3(b), the Capital Account of all
Partners and the Carrying Value of each Partnership property immediately prior
to such issuance shall be adjusted upward or downward to reflect any Unrealized
Gain or Unrealized Loss attributable to such Partnership property, as if such
Unrealized Gain or Unrealized Loss had been recognized on an actual sale of each
such property immediately prior to such issuance and had been allocated to the
Partners at such time pursuant to Section 6.1 in the same manner as any item of
gain or loss actually recognized during such period would have been allocated.
In determining such Unrealized Gain or Unrealized Loss, the aggregate cash
amount and fair market value of all Partnership assets (including, without
limitation, cash or cash equivalents) immediately prior to the issuance of
additional Partnership Interests shall be determined by the General Partner
using such reasonable method of valuation as it may adopt; provided, however,
that the General Partner, in arriving at such valuation, must take fully into
account the fair market value of the Partnership Interests of all Partners at
such time. The General Partner shall allocate such aggregate value among the
assets of the Partnership (in such manner as it determines in its discretion to
be reasonable) to arrive at a fair market value for individual properties.

                  (ii) In accordance with Treasury Regulation Section
         1.704-1(b)(2)(iv)(f), immediately prior to any actual or deemed
         distribution to a Partner of any Partnership property (other than a
         distribution of cash that is not in redemption or retirement of a
         Partnership Interest), the Capital Accounts of all Partners and the
         Carrying Value of all Partnership property shall be adjusted upward or
         downward to reflect any Unrealized Gain or Unrealized Loss attributable
         to such Partnership property, as if such Unrealized Gain or Unrealized
         Loss had been recognized in a sale of such property immediately prior
         to such distribution for an amount equal to its fair market value, and
         had been allocated to the Partners, at such time, pursuant to Section
         6.1 in the same manner as any item of gain or loss actually recognized
         during such period would have been allocated. In determining such
         Unrealized Gain or Unrealized Loss, the aggregate cash amount and fair
         market value of all Partnership assets (including, without limitation,
         cash or cash equivalents) immediately prior to a distribution shall (A)
         in the case of an actual distribution which is not made pursuant to
         Section 12.4 or in the case of a deemed distribution, be determined and
         allocated in the same manner as that provided in Section 5.5(d)(i) or
         (B) in the case of a liquidating distribution pursuant to Section 12.4,
         be determined and allocated by the Liquidator using such reasonable
         method of valuation as it may adopt.

         Section 5.6 Issuances of Additional Partnership Securities.



                                       36
<PAGE>



         (a) Subject to Section 5.7, the Partnership may issue additional
Partnership Securities and options, rights, warrants and appreciation rights
relating to the Partnership Securities for any Partnership purpose at any time
and from time to time to such Persons for such consideration and on such terms
and conditions as shall be established by the General Partner in its sole
discretion, all without the approval of any Limited Partners.

         (b) Each additional Partnership Security authorized to be issued by the
Partnership pursuant to Section 5.6(a) may be issued in one or more classes, or
one or more series of any such classes, with such designations, preferences,
rights, powers and duties (which may be senior to existing classes and series of
Partnership Securities), as shall be fixed by the General Partner in the
exercise of its sole discretion, including (i) the right to share Partnership
profits and losses or items thereof; (ii) the right to share in Partnership
distributions; (iii) rights upon dissolution and liquidation of the Partnership;
(iv) whether, and the terms and conditions upon which, the Partnership may
redeem the Partnership Security; (v) whether such Partnership Security is issued
with the privilege of conversion or exchange and, if so, the terms and
conditions of such conversion or exchange; (vi) the terms and conditions upon
which each Partnership Security will be issued, evidenced by certificates and
assigned or transferred; and (vii) the right, if any, of each such Partnership
Security to vote on Partnership matters, including matters relating to the
relative rights, preferences and privileges of such Partnership Security.

         (c) The General Partner is hereby authorized and directed to take all
actions that it deems necessary or appropriate in connection with (i) each
issuance of Partnership Securities and options, rights, warrants and
appreciation rights relating to Partnership Securities pursuant to this Section
5.6, (ii) the conversion of the General Partner Interest or any Incentive
Distribution Rights into Units pursuant to the terms of this Agreement, (iii)
the admission of Additional Limited Partners and (iv) all additional issuances
of Partnership Securities. The General Partner is further authorized and
directed to specify the relative rights, powers and duties of the holders of the
Units or other Partnership Securities being so issued. The General Partner shall
do all things necessary to comply with the Delaware Act and is authorized and
directed to do all things it deems to be necessary or advisable in connection
with any future issuance of Partnership Securities or in connection with the
conversion of the General Partner Interest or any Incentive Distribution Rights
into Units pursuant to the terms of this Agreement, including compliance with
any statute, rule, regulation or guideline of any federal, state or other
governmental agency or any National Securities Exchange on which the Units or
other Partnership Securities are listed for trading.

         Section 5.7 Limitations on Issuance of Additional Partnership
Securities. Except as otherwise specified in this Section 5.7, the issuance of
Partnership Securities pursuant to Section 5.6 shall be subject to the following
restrictions and limitations:

         (a) During the Subordination Period, the Partnership shall not issue
(and shall not issue any options, rights, warrants or appreciation rights
relating to) an aggregate of more than 1,500,000 (plus an amount, if any, equal
to one half of the number of Units issued pursuant to the Over-Allotment Option,
if and to the extent exercised) additional Parity Units without the prior
approval of the holders of a Unit Majority. In applying this limitation, there
shall be excluded Common Units and other Parity Units issued (A) in connection
with the Underwriting



                                       37
<PAGE>



Agreement, (B) in accordance with Sections 5.7(b) and 5.7(c), (C) upon
conversion of Subordinated Units pursuant to Section 5.8, (D) upon conversion of
the General Partner Interest or any Incentive Distribution Rights pursuant to
Section 11.3(b), (D) pursuant to the employee benefit plans of the General
Partner, the Partnership or any other Group Member, (E) upon a conversion or
exchange of Parity Units issued after the date hereof into Common Units or other
Parity Units; provided that the total amount of Available Cash required to pay
the aggregate Minimum Quarterly Distribution on all Common Units and all Parity
Units does not increase as a result of this conversion or exchange and (F) in
the event of a combination or subdivision of Common Units.

         (b) During the Subordination Period, the Partnership may also issue an
unlimited number of Parity Units without the prior approval of the Unitholders,
if such issuance occurs (i) in connection with an Acquisition or a Capital
Improvement or (ii) within 365 days of, and the net proceeds from such issuance
are used to repay debt incurred in connection with, an Acquisition or a Capital
Improvement, in each case where such Acquisition or Capital Improvement involves
assets that, if acquired by the Partnership as of the date that is one year
prior to the first day of the Quarter in which such Acquisition is to be
consummated or such Capital Improvement is to be completed, would have resulted,
on a pro forma basis, in an increase in:

                           (A) the amount of Adjusted Operating Surplus
                  generated by the Partnership on a per-Unit basis (for all
                  Outstanding Units) with respect to each of the four most
                  recently completed Quarters (on a pro forma basis as described
                  below) as compared to

                           (B) the actual amount of Adjusted Operating Surplus
                  generated by the Partnership on a per-Unit basis (for all
                  Outstanding Units) (excluding Adjusted Operating Surplus
                  attributable to the Acquisition or Capital Improvement) with
                  respect to each of such four most recently completed Quarters.

The General Partner's good faith determination that such an increase would have
resulted shall be conclusive. If the issuance of Parity Units with respect to an
Acquisition or Capital Improvement occurs within the first four full Quarters
after the Closing Date, then Adjusted Operating Surplus as used in clauses (A)
(subject to the succeeding sentence) and (B) above shall be calculated (i) for
each Quarter, if any, that commenced after the Closing Date for which actual
results of operations are available, based on the actual Adjusted Operating
Surplus of the Partnership generated with respect to such Quarter, and (ii) for
each other Quarter, on a pro forma basis consistent with the procedures, as
applicable, set forth in Appendix D to the Registration Statement. Furthermore,
the amount in clause (A) shall be determined on a pro forma basis assuming that
(1) all of the Parity Units to be issued in connection with or within 365 days
of such Acquisition or Capital Improvement had been issued and outstanding, (2)
all indebtedness for borrowed money to be incurred or assumed in connection with
such Acquisition or Capital Improvement (other than any such indebtedness that
is to be repaid with the proceeds of such issuance of Parity Units) had been
incurred or assumed, in each case as of the commencement of such four-Quarter
period, (3) the personnel expenses that would have been incurred by the
Partnership in the operation of the acquired assets are the personnel expenses
for employees to be retained by the Partnership in the operation of the acquired
assets, and (4) the



                                       38
<PAGE>



non-personnel costs and expenses are computed on the same basis as those
incurred by the Partnership in the operation of the Partnership's business at
similarly situated Partnership facilities. For the purposes of this Section
5.7(b), the term "debt" shall be deemed to include indebtedness used to extend,
refinance, renew, replace or defease any debt-originally incurred in connection
with an Acquisition or Capital Improvement.

         (c) During the Subordination Period, without the prior approval of the
holders of a Unit Majority, the Partnership shall not issue any additional
Partnership Securities (or options, rights, warrants or appreciation rights
related thereto) (i) that are entitled in any Quarter to receive in respect of
the Subordination Period any distribution of Available Cash from Operating
Surplus before the Common Units and any Parity Units have received (or amounts
have been set aside for payment of) the Minimum Quarterly Distribution and any
Cumulative Common Unit Arrearage for such Quarter or (ii) that are entitled to
allocations in respect of the Subordination Period of Net Termination Gain
before the Common Units and any Parity Units have been allocated Net Termination
Gain pursuant to Section 6.1(c)(i)(B).

         (d) During the Subordination Period, without the prior approval of the
Unitholders, the Partnership may issue additional Partnership Securities (or
options, rights, warrants or appreciation rights related thereto) (i) that are
not entitled in any Quarter during the Subordination Period to receive any
distributions of Available Cash from Operating Surplus until after the Common
Units and any Parity Units have received (or amounts have been set aside for
payment of) the Minimum Quarterly Distribution and any Cumulative Common Unit
Arrearage for such Quarter and (ii) that are not entitled to allocations in
respect of the Subordination Period of Net Termination Gain before the Common
Units and Parity Units have been allocated Net Termination Gain pursuant to
Section 6.1(c)(i)(B), even if (A) the amount of Available Cash from Operating
Surplus to which each such Partnership Security is entitled to receive after the
Minimum Quarterly Distribution and any Cumulative Common Unit Arrearage have
been paid or set aside for payment on the Common Units exceeds the Minimum
Quarterly Distribution, (B) the amount of Net Termination Gain to be allocated
to such Partnership Security after Net Termination Gain has been allocated to
any Common Units and Parity Units pursuant to Section 6.1(c)(i)(B) exceeds the
amount of such Net Termination Gain to be allocated to each Common Unit or
Parity Unit or (C) the holders of such additional Partnership Securities have
the right to require the Partnership or its Affiliates to repurchase such
Partnership Securities at a discount, par or a premium.

         (e) During the Subordination Period, the Partnership may also issue an
unlimited number of Parity Units without the approval of the Unitholders, if the
proceeds from such issuance are used exclusively to repay up to $15,000,000 of
indebtedness of a Group Member where the aggregate amount of distributions that
would have been paid with respect to such newly issued Units or Partnership
Securities, plus the related distributions on the General Partner Interest in
respect of the four-Quarter period ending prior to the first day of the Quarter
in which the issuance is to be consummated (assuming such additional Units or
Partnership Securities had been Outstanding throughout such period and that
distributions equal to the distributions that were actually paid on the
Outstanding Units during the period were paid on such additional Units or
Partnership Securities) did not exceed the interest costs actually incurred
during such period on the indebtedness that is to be repaid (or, if such
indebtedness was not outstanding throughout the entire period, would have been
incurred had such indebtedness been outstanding for the



                                       39
<PAGE>



entire period). In the event that the Partnership is required to pay a
prepayment penalty in connection with the repayment of such indebtedness, for
purposes of the foregoing test the number of Parity Units issued to repay such
indebtedness shall be deemed increased by the number of Parity Units that would
need to be issued to pay such penalty.

         (f) No fractional Units shall be issued by the Partnership.

         Section 5.8 Conversion of Subordinated Units. A total of 850,672 of the
Outstanding Subordinated Units will convert into Common Units on a one-for-one
basis immediately after the distribution of Available Cash to Partners pursuant
to Section 6.3(a) in respect of any Quarter ending on or after September 30,
2005 in respect of which:

                  (i) distributions under Section 6.4 in respect of all
         Outstanding Common Units and Subordinated Units and any other
         Outstanding Units that are senior or equal in right of distribution to
         the Subordinated Units with respect to each of the three consecutive,
         non-overlapping four-Quarter periods immediately preceding such date
         equaled or exceeded the sum of the Minimum Quarterly Distribution on
         all of the Outstanding Common Units and Subordinated Units and any
         other Outstanding Units that are senior or equal in right of
         distribution to the Subordinated Units during such periods;

                  (ii) the Adjusted Operating Surplus generated during each of
         the three consecutive, non-overlapping four-Quarter periods immediately
         preceding such date equaled or exceeded the sum of the Minimum
         Quarterly Distribution on all of the Common Units, Subordinated Units
         and any other Units that are senior or equal in right of distribution
         to the Subordinated Units that were Outstanding during such periods on
         a Fully Diluted Basis, plus the related distribution on the General
         Partner Interest in the Partnership, during such periods; and

                  (iii) the Cumulative Common Unit Arrearage on all of the
         Common Units is zero.

         (b) An additional 850,672 of the Outstanding Subordinated Units will
convert into Common Units on a one-for-one basis immediately after the
distribution of Available Cash to Partners pursuant to Section 6.3(a) in respect
of any Quarter ending on or after September 30, 2006, in respect of which:

                  (i) distributions under Section 6.4 in respect of all
         Outstanding Common Units and Subordinated Units and any other
         Outstanding Units that are senior or equal in right of distribution to
         the Subordinated Units with respect to each of the three consecutive,
         non-overlapping four-Quarter periods immediately preceding such date
         equaled or exceeded the sum of the Minimum Quarterly Distribution on
         all of the Outstanding Common Units and Subordinated Units and any
         other Outstanding Units that are senior or equal in right of
         distribution to the Subordinated Units during such periods;

                  (ii) the Adjusted Operating Surplus generated during each of
         the three consecutive, non-overlapping four-Quarter periods immediately
         preceding such date equaled or exceeded the sum of the Minimum
         Quarterly Distribution on all of the Common Units, Subordinated Units
         and any other Units that are senior or equal in right



                                       40
<PAGE>



         of distribution to the Subordinated Units that were Outstanding during
         such periods on a Fully Diluted Basis, plus the related distribution on
         the General Partner Interest during such periods; and

                  (iii) the Cumulative Common Unit Arrearage on all of the
         Common Units is zero;

provided, however, that the conversion of Subordinated Units pursuant to this
Section 5.8(b) may not occur until at least one year following the conversion of
Subordinated Units pursuant to Section 5.8(a).

         (c) An additional 850,672 of the Outstanding Subordinated Units will
convert into Common Units on a one-for-one basis immediately after the
distribution of Available Cash to Partners pursuant to Section 6.3(a) in respect
of any Quarter ending on or after September 30, 2007, in respect of which:

                  (i) distributions under Section 6.4 in respect of all
         Outstanding Common Units and Subordinated Units and any other
         Outstanding Units that are senior or equal in right of distribution to
         the Subordinated Units with respect to each of the three consecutive,
         non-overlapping four-Quarter periods immediately preceding such date
         equaled or exceeded the sum of the Minimum Quarterly Distribution on
         all of the Outstanding Common Units and Subordinated Units and any
         other Outstanding Units that are senior or equal in right of
         distribution to the Subordinated Units during such periods;

                  (ii) the Adjusted Operating Surplus generated during each of
         the three consecutive, non-overlapping four-Quarter periods immediately
         preceding such date equaled or exceeded the sum of the Minimum
         Quarterly Distribution on all of the Common Units, Subordinated Units
         and any other Units that are senior or equal in right of distribution
         to the Subordinated Units that were Outstanding during such periods on
         a Fully Diluted Basis, plus the related distribution on the General
         Partner Interest during such periods; and

                  (iii) the Cumulative Common Unit Arrearage on all of the
         Common Units is zero;

provided, however, that the conversion of Subordinated Units pursuant to this
Section 5.8(c) may not occur until at least one year following the conversion of
Subordinated Units pursuant to Section 5.8(b).

         (d) An additional 850,672 of the Outstanding Subordinated Units will
convert into Common Units on a one-for-one basis immediately after the
distribution of Available Cash to Partners pursuant to Section 6.3(a) in respect
of any Quarter ending on or after September 30, 2008, in respect of which:

                  (i) distributions under Section 6.4 in respect of all
         Outstanding Common Units and Subordinated Units and any other
         Outstanding Units that are senior or equal in right of distribution to
         the Subordinated Units with respect to each of the three consecutive,
         non-overlapping four-Quarter periods immediately preceding such date



                                       41
<PAGE>



         equaled or exceeded the sum of the Minimum Quarterly Distribution on
         all of the Outstanding Common Units and Subordinated Units and any
         other Outstanding Units that are senior or equal in right of
         distribution to the Subordinated Units during such periods;

                  (ii) the Adjusted Operating Surplus generated during each of
         the three consecutive, non-overlapping four-Quarter periods immediately
         preceding such date equaled or exceeded the sum of the Minimum
         Quarterly Distribution on all of the Common Units, Subordinated Units
         and any other Units that are senior or equal in right of distribution
         to the Subordinated Units that were Outstanding during such periods on
         a Fully Diluted Basis, plus the related distribution on the General
         Partner Interest during such periods; and

                  (iii) the Cumulative Common Unit Arrearage on all of the
         Common Units is zero;

provided, however, that the conversion of Subordinated Units pursuant to this
Section 5.8(d) may not occur until at least one year following the conversion of
Subordinated Units pursuant to Section 5.8(c).

         (e) An additional 850,672 of the Outstanding Subordinated Units will
convert into Common Units on a one-for-one basis immediately after the
distribution of Available Cash to Partners pursuant to Section 6.3(a) in respect
of any Quarter ending on or after September 30, 2005, in respect of which:

                  (i) distributions under Section 6.4 in respect of all
         Outstanding Common Units and Subordinated Units and any other
         Outstanding Units that are senior or equal in right of distribution to
         the Subordinated Units with respect to each of the two consecutive,
         non-overlapping four-Quarter periods immediately preceding such date
         equaled or exceeded the sum of the Second Target Distribution on all of
         the Outstanding Common Units and Subordinated Units and any other
         Outstanding Units that are senior or equal in right of distribution to
         the Subordinated Units during such periods;

                  (ii) the Adjusted Operating Surplus generated during each of
         the two consecutive, non-overlapping four-Quarter periods immediately
         preceding such date equaled or exceeded the sum of the Second Target
         Distribution on all of the Common Units, Subordinated Units and any
         other Units that are senior or equal in right of distribution to the
         Subordinated Units that were Outstanding during such periods on a Fully
         Diluted Basis, plus the related distribution on the General Partner
         Interest during such periods; and

                  (iii) the Cumulative Common Unit Arrearage on all of the
         Common Units is zero;

         (f) An additional 850,672 of the Outstanding Subordinated Units will
convert into Common Units on a one-for-one basis immediately after the
distribution of Available Cash to Partners pursuant to Section 6.3(a) in respect
of any Quarter ending on or after September 30, 2005, in respect of which:



                                       42
<PAGE>
                  (i) distributions under Section 6.4 in respect of all
         Outstanding Common Units and Subordinated Units and any other
         Outstanding Units that are senior or equal in right of distribution to
         the Subordinated Units with respect to each of the two consecutive,
         non-overlapping four-Quarter periods immediately preceding such date
         equaled or exceeded the sum of the Third Target Distribution on all of
         the Outstanding Common Units and Subordinated Units and any other
         Outstanding Units that are senior or equal in right of distribution to
         the Subordinated Units during such periods;

                  (ii) the Adjusted Operating Surplus generated during each of
         the two consecutive, non-overlapping four-Quarter periods immediately
         preceding such date equaled or exceeded the sum of the Third Target
         Distribution on all of the Common Units, Subordinated Units and any
         other Units that are senior or equal in right of distribution to the
         Subordinated Units that were Outstanding during such periods on a Fully
         Diluted Basis, plus the related distribution on the General Partner
         Interest during such periods; and

         (g) (iii) the Cumulative Common Unit Arrearage on all of the Common
Units is zero. In the event that less than all of the Outstanding Subordinated
Units shall convert into Common Units pursuant to Section 5.8(a) - (f) at a time
when there shall be more than one holder of Subordinated Units, then, unless all
of the holders of Subordinated Units shall agree to a different allocation, the
Subordinated Units that are to be converted into Common Units shall be allocated
among the holders of Subordinated Units pro rata based on the number of
Subordinated Units held by each such holder.

         (h) Any Subordinated Units that are not converted into Common Units
pursuant to Section 5.8(a) - (f) shall convert into Common Units on a
one-for-one basis immediately after the distribution of Available Cash to
Partners pursuant to Section 6.3(a) in respect of the final Quarter of the
Subordination Period.

         (i) Notwithstanding any other provision of this Agreement, all the then
Outstanding Subordinated Units will automatically convert into Common Units on a
one-for-one basis as set forth in, and pursuant to the terms of, Section 11.4.

         (j) A Subordinated Unit that has converted into a Common Unit shall be
subject to the provisions of Section 6.7(b).

         Section 5.9 Limited Preemptive Right. Except as provided in this
Section 5.9 and in Section 5.2, no Person shall have any preemptive,
preferential or other similar right with respect to the issuance of any
Partnership Security, whether unissued, held in the treasury or hereafter
created. The General Partner shall have the right, which it may from time to
time assign in whole or in part to any of its Affiliates, to purchase
Partnership Securities from the Partnership whenever, and on the same terms
that, the Partnership issues Partnership Securities to Persons other than the
General Partner and its Affiliates, to the extent necessary to maintain the
Percentage Interests of the General Partner and its Affiliates equal to that
which existed immediately prior to the issuance of such Partnership Securities.



                                       43
<PAGE>



         Section 5.10 Splits and Combinations.

         (a) Subject to Sections 5.10(d), 6.6 and 6.9 (dealing with adjustments
of distribution levels), the Partnership may make a Pro Rata distribution of
Partnership Securities to all Record Holders or may effect a subdivision or
combination of Partnership Securities so long as, after any such event, each
Partner shall have the same Percentage Interest in the Partnership as before
such event, and any amounts calculated on a per Unit basis (including any Common
Unit Arrearage or Cumulative Common Unit Arrearage) or stated as a number of
Units (including the number of Subordinated Units that may convert prior to the
end of the Subordination Period and the number of additional Parity Units that
may be issued pursuant to Section 5.7 without a Unitholder vote) are
proportionately adjusted retroactive to the beginning of the Partnership.

         (b) Whenever such a distribution, subdivision or combination of
Partnership Securities is declared, the General Partner shall select a Record
Date as of which the distribution, subdivision or combination shall be effective
and shall send notice thereof at least 20 days prior to such Record Date to each
Record Holder as of a date not less than 10 days prior to the date of such
notice. The General Partner also may cause a firm of independent public
accountants selected by it to calculate the number of Partnership Securities to
be held by each Record Holder after giving effect to such distribution,
subdivision or combination. The General Partner shall be entitled to rely on any
certificate provided by such firm as conclusive evidence of the accuracy of such
calculation.

         (c) Promptly following any such distribution, subdivision or
combination, the Partnership may issue Certificates to the Record Holders of
Partnership Securities as of the applicable Record Date representing the new
number of Partnership Securities held by such Record Holders, or the General
Partner may adopt such other procedures as it may deem appropriate to reflect
such changes. If any such combination results in a smaller total number of
Partnership Securities Outstanding, the Partnership shall require, as a
condition to the delivery to a Record Holder of such new Certificate, the
surrender of any Certificate held by such Record Holder immediately prior to
such Record Date.

         (d) The Partnership shall not issue fractional Units upon any
distribution, subdivision or combination of Units. If a distribution,
subdivision or combination of Units would result in the issuance of fractional
Units but for the provisions of Section 5.7(e) and this Section 5.10(d), each
fractional Unit shall be rounded to the nearest whole Unit (and a 0.5 Unit shall
be rounded to the next higher Unit).

         Section 5.11 Fully Paid and Non-Assessable Nature of Limited Partner
Interests. All Limited Partner Interests issued pursuant to, and in accordance
with the requirements of, this Article V shall be fully paid and non-assessable
Limited Partner Interests in the Partnership, except as such non-accessibility
may be affected by Section 17-607 of the Delaware Act.

                                   ARTICLE VI
                          ALLOCATIONS AND DISTRIBUTIONS

         Section 6.1 Allocations for Capital Account Purposes. For purposes of
maintaining the Capital Accounts and in determining the rights of the Partners
among themselves, the



                                       44
<PAGE>



Partnership's items of income, gain, loss and deduction (computed in accordance
with Section 5.5(b)) shall be allocated among the Partners in each taxable year
(or portion thereof) as provided herein below.

         (a) Net Income. After giving effect to the special allocations set
forth in Section 6.1(d), Net Income for each taxable year and all items of
income, gain, loss and deduction taken into account in computing Net Income for
such taxable year shall be allocated as follows:

                  (i) First, 100% to the General Partner, in an amount equal to
         the aggregate Net Losses allocated to the General Partner pursuant to
         Section 6.1(b)(iii) for all previous taxable years until the aggregate
         Net Income allocated to the General Partner pursuant to this Section
         6.1(a)(i) for the current taxable year and all previous taxable years
         is equal to the aggregate Net Losses allocated to the General Partner
         pursuant to Section 6.1(b)(iii) for all previous taxable years;

                  (ii) Second, 2% to the General Partner, in an amount equal to
         the aggregate Net Losses allocated to the General Partner pursuant to
         Section 6.1(b)(ii) for all previous taxable years and 98% to the
         Unitholders, in accordance with their respective Percentage Interests,
         until the aggregate Net Income allocated to such Partners pursuant to
         this Section 6.1(a)(ii) for the current taxable year and all previous
         taxable years is equal to the aggregate Net Losses allocated to such
         Partners pursuant to Section 6.1(b)(ii) for all previous taxable years;
         and

                  (iii) Third, 2% to the General Partner, and 98% to the
         Unitholders, Pro Rata.

         (b) Net Losses. After giving effect to the special allocations set
forth in Section 6.1(d), Net Losses for each taxable period and all items of
income, gain, loss and deduction taken into account in computing Net Losses for
such taxable period shall be allocated as follows:

                  (i) First, 2% to the General Partner, and 98% to the
         Unitholders, Pro Rata, until the aggregate Net Losses allocated
         pursuant to this Section 6.1(b)(i) for the current taxable year and all
         previous taxable years is equal to the aggregate Net Income allocated
         to such Partners pursuant to Section 6.1(a)(iii) for all previous
         taxable years, provided that the Net Losses shall not be allocated
         pursuant to this Section 6.1(b)(i) to the extent that such allocation
         would cause any Unitholder to have a deficit balance in its Adjusted
         Capital Account at the end of such taxable year (or increase any
         existing deficit balance in its Adjusted Capital Account);

                  (ii) Second, 2% to the General Partner, and 98% to the
         Unitholders, Pro Rata; provided, that Net Losses shall not be allocated
         pursuant to this Section 6.1(b)(ii) to the extent that such allocation
         would cause any Unitholder to have a deficit balance in its Adjusted
         Capital Account at the end of such taxable year (or increase any
         existing deficit balance in its Adjusted Capital Account);

                  (iii) Third, the balance, if any, 100% to the General Partner.



                                       45
<PAGE>



         (c) Net Termination Gains and Losses. After giving effect to the
special allocations set forth in Section 6.1(d), all items of income, gain, loss
and deduction taken into account in computing Net Termination Gain or Net
Termination Loss for such taxable period shall be allocated in the same manner
as such Net Termination Gain or Net Termination Loss is allocated hereunder. All
allocations under this Section 6.1(c) shall be made after Capital Account
balances have been adjusted by all other allocations provided under this Section
6.1 and after all distributions of Available Cash provided under Sections 6.4
and 6.5 have been made; provided, however, that solely for purposes of this
Section 6.1(c), Capital Accounts shall not be adjusted for distributions made
pursuant to Section 12.4.

                  (i) If a Net Termination Gain is recognized (or deemed
         recognized pursuant to Section 5.5(d)), such Net Termination Gain shall
         be allocated among the Partners in the following manner (and the
         Capital Accounts of the Partners shall be increased by the amount so
         allocated in each of the following subclauses, in the order listed,
         before an allocation is made pursuant to the next succeeding
         subclause):

                           (A) First, to each Partner having a deficit balance
                  in its Capital Account, in the proportion that such deficit
                  balance bears to the total deficit balances in the Capital
                  Accounts of all Partners, until each such Partner has been
                  allocated Net Termination Gain equal to any such deficit
                  balance in its Capital Account;

                           (B) Second, 98% to all Unitholders holding Common
                  Units, Pro Rata, and 2% to the General Partner, until the
                  Capital Account in respect of each Common Unit then
                  Outstanding is equal to the sum of (1) its Unrecovered Capital
                  plus (2) the Minimum Quarterly Distribution for the Quarter
                  during which the Liquidation Date occurs, reduced by any
                  distribution pursuant to Section 6.4(a)(i) or (b)(i) with
                  respect to such Common Unit for such Quarter (the amount
                  determined pursuant to this clause (2) is hereinafter defined
                  as the "Unpaid MQD") plus (3) any then existing Cumulative
                  Common Unit Arrearage;

                           (C) Third, if such Net Termination Gain is recognized
                  (or is deemed to be recognized) prior to the expiration of the
                  Subordination Period, 98% to all Unitholders holding
                  Subordinated Units, Pro Rata, and 2% to the General Partner,
                  until the Capital Account in respect of each Subordinated Unit
                  then Outstanding equals the sum of (1) its Unrecovered
                  Capital, determined for the taxable year (or portion thereof)
                  to which this allocation of gain relates, plus (2) the Minimum
                  Quarterly Distribution for the Quarter during which the
                  Liquidation Date occurs, reduced by any distribution pursuant
                  to Section 6.4(a)(iii) with respect to such Subordinated Unit
                  for such Quarter;

                           (D) Fourth, 98% to all Unitholders, Pro Rata, and 2%
                  to the General Partner, until the Capital Account in respect
                  of each Common Unit then Outstanding is equal to the sum of
                  (1) its Unrecovered Capital, plus (2) the Unpaid MQD, plus (3)
                  any then existing Cumulative Common Unit Arrearage, plus (4)
                  the excess of (aa) the First Target Distribution less the
                  Minimum Quarterly Distribution for each Quarter of the
                  Partnership's existence over



                                       46
<PAGE>



                  (bb) the cumulative per Unit amount of any distributions of
                  Available Cash that is deemed to be Operating Surplus made
                  pursuant to Sections 6.4(a)(iv) and 6.4(b)(ii) (the sum of (1)
                  plus (2) plus (3) plus (4) is hereinafter defined as the
                  "First Liquidation Target Amount");

                           (E) Fifth, 85% to all Unitholders, Pro Rata, 13% to
                  the holders of the Incentive Distribution Rights, Pro Rata,
                  and 2% to the General Partner, until the Capital Account in
                  respect of each Common Unit then Outstanding is equal to the
                  sum of (1) the First Liquidation Target Amount, plus (2) the
                  excess of (aa) the Second Target Distribution less the First
                  Target Distribution for each Quarter of the Partnership's
                  existence over (bb) the cumulative per Unit amount of any
                  distributions of Available Cash that is deemed to be Operating
                  Surplus made pursuant to Sections 6.4(a)(v) and 6.4(b)(iii)
                  (the sum of (1) plus (2) is hereinafter defined as the "Second
                  Liquidation Target Amount");

                           (F) Sixth, 75% to all Unitholders, Pro Rata, 23% to
                  the holders of the Incentive Distribution Rights, Pro Rata,
                  and 2% to the General Partner, until the Capital Account in
                  respect of each Common Unit then Outstanding is equal to the
                  sum of (1) the Second Liquidation Target Amount, plus (2) the
                  excess of (aa) the Third Target Distribution less the Second
                  Target Distribution for each Quarter of the Partnership's
                  existence over (bb) the cumulative per Unit amount of any
                  distributions of Available Cash that is deemed to be Operating
                  Surplus made pursuant to Sections 6.4(a)(vi)and 6.4(b)(iv)
                  (the sum of (1) plus (2) is hereinafter defined as the "Third
                  Liquidation Target Amount"); and

                           (G) Finally, any remaining amount 50% to all
                  Unitholders, Pro Rata, 48% to the holders of the Incentive
                  Distribution Rights, Pro Rata, and 2% to the General Partner.

                  (ii) If a Net Termination Loss is recognized (or deemed
         recognized pursuant to Section 5.5(d)), such Net Termination Loss shall
         be allocated among the Partners in the following manner:

                           (A) First, if such Net Termination Loss is recognized
                  (or is deemed to be recognized) prior to the conversion of the
                  last Outstanding Subordinated Unit, 98% to the Unitholders
                  holding Subordinated Units, Pro Rata, and 2% to the General
                  Partner, until the Capital Account in respect of each
                  Subordinated Unit then Outstanding has been reduced to zero;

                           (B) Second, 98% to all Unitholders holding Common
                  Units, Pro Rata, and 2% to the General Partner, until the
                  Capital Account in respect of each Common Unit then
                  Outstanding has been reduced to zero; and

                           (C) Third, the balance, if any, 100% to the General
                  Partner.

                  (iii) If, immediately prior to the allocation of any Net
         Termination Gain or Net Termination Loss pursuant to Section 6.1(c)(i)
         and (ii), the cumulative amount of Capital Contributions by the General
         Partner to the Partnership described in Section 5.2(c)



                                       47
<PAGE>



         exceeds the cumulative amount of items allocated to the General Partner
         pursuant to Section 6.1(d)(xiii), items of loss and deduction shall be
         allocated to the General Partner, immediately prior to any allocation
         pursuant to Section 6.1(c)(i) and (ii), in an amount equal to such
         excess. In the event the amount of Partnership losses and deductions
         available to make the allocation described in the previous sentence is
         less than the amount required to satisfy such allocation, Net
         Termination Gain that would otherwise be allocated to the General
         Partner pursuant to Sections 6.1(c)(i)(B), (D), (E), (F) or (G), in an
         amount equal to such shortfall, shall be allocated to the Unitholders
         holding Common Units instead.

         (d) Special Allocations. Notwithstanding any other provision of this
Section 6.1, the following special allocations shall be made for such taxable
period:

                  (i) Partnership Minimum Gain Chargeback. Notwithstanding any
         other provision of this Section 6.1, if there is a net decrease in
         Partnership Minimum Gain during any Partnership taxable period, each
         Partner shall be allocated items of Partnership income and gain for
         such period (and, if necessary, subsequent periods) in the manner and
         amounts provided in Treasury Regulation Sections 1.704-2(f)(6),
         1.704-2(g)(2) and 1.704-2(j)(2)(i), or any successor provision. For
         purposes of this Section 6.1(d), each Partner's Adjusted Capital
         Account balance shall be determined, and the allocation of income or
         gain required hereunder shall be effected, prior to the application of
         any other allocations pursuant to this Section 6.1(d) with respect to
         such taxable period (other than an allocation pursuant to Sections
         6.1(d)(vi) and 6.1(d)(vii)). This Section 6.1(d)(i) is intended to
         comply with the Partnership Minimum Gain chargeback requirement in
         Treasury Regulation Section 1.704-2(f) and shall be interpreted
         consistently therewith.

                  (ii) Chargeback of Partner Nonrecourse Debt Minimum Gain.
         Notwithstanding the other provisions of this Section 6.1 (other than
         Section 6.1(d)(i)), except as provided in Treasury Regulation Section
         1.704-2(i)(4), if there is a net decrease in Partner Nonrecourse Debt
         Minimum Gain during any Partnership taxable period, any Partner with a
         share of Partner Nonrecourse Debt Minimum Gain at the beginning of such
         taxable period shall be allocated items of Partnership income and gain
         for such period (and, if necessary, subsequent periods) in the manner
         and amounts provided in Treasury Regulation Sections 1.704-2(i)(4) and
         1.704-2(j)(2)(ii), or any successor provisions. For purposes of this
         Section 6.1(d), each Partner's Adjusted Capital Account balance shall
         be determined, and the allocation of income or gain required hereunder
         shall be effected, prior to the application of any other allocations
         pursuant to this Section 6.1(d), other than Section 6.1(d)(i) and other
         than an allocation pursuant to Sections 6.1(d)(vi) and 6.1(d)(vii),
         with respect to such taxable period. This Section 6.1(d)(ii) is
         intended to comply with the chargeback of items of income and gain
         requirement in Treasury Regulation Section 1.704-2(i)(4) and shall be
         interpreted consistently therewith.



                                       48
<PAGE>



                  (iii) Priority Allocations.

                           (A) If the amount of cash or the Net Agreed Value of
                  any property distributed (except cash or property distributed
                  pursuant to Section 12.4) to any Unitholder with respect to
                  its Units for a taxable year is greater (on a per Unit basis)
                  than the amount of cash or the Net Agreed Value of property
                  distributed to the other Unitholders with respect to their
                  Units (on a per Unit basis), then (1) each Unitholder
                  receiving such greater cash or property distribution shall be
                  allocated gross income in an amount equal to the product of
                  (aa) the amount by which the distribution (on a per Unit
                  basis) to such Unitholder exceeds the distribution (on a per
                  Unit basis) to the Unitholders receiving the smallest
                  distribution and (bb) the number of Units owned by the
                  Unitholder receiving the greater distribution; and (2) the
                  General Partner shall be allocated gross income in an
                  aggregate amount equal to 1/98th of the sum of the amounts
                  allocated in clause (1) above.

                           (B) After the application of Section 6.1(d)(iii)(A),
                  all or any portion of the remaining items of Partnership gross
                  income or gain for the taxable period, if any, shall be
                  allocated 100% to the holders of Incentive Distribution
                  Rights, Pro Rata, until the aggregate amount of such items
                  allocated to the holders of Incentive Distribution Rights
                  pursuant to this paragraph 6.1(d)(iii)(B) for the current
                  taxable year and all previous taxable years is equal to the
                  cumulative amount of all Incentive Distributions made to the
                  holders of Incentive Distribution Rights from the Closing Date
                  to a date 45 days after the end of the current taxable year.

                  (iv) Qualified Income Offset. In the event any Partner
         unexpectedly receives any adjustments, allocations or distributions
         described in Treasury Regulation Sections 1.704-1(b)(2)(ii)(d)(4),
         1.704-1(b)(2)(ii)(d)(5), or 1.704-1(b)(2)(ii)(d)(6), items of
         Partnership income and gain shall be specially allocated to such
         Partner in an amount and manner sufficient to eliminate, to the extent
         required by the Treasury Regulations promulgated under Section 704(b)
         of the Code, the deficit balance, if any, in its Adjusted Capital
         Account created by such adjustments, allocations or distributions as
         quickly as possible unless such deficit balance is otherwise eliminated
         pursuant to Section 6.1(d)(i) or (ii).

                  (v) Gross Income Allocations. In the event any Partner has a
         deficit balance in its Capital Account at the end of any Partnership
         taxable period in excess of the sum of (A) the amount such Partner is
         required to restore pursuant to the provisions of this Agreement and
         (B) the amount such Partner is deemed obligated to restore pursuant to
         Treasury Regulation Sections 1.704-2(g) and 1.704-2(i)(5), such Partner
         shall be specially allocated items of Partnership gross income and gain
         in the amount of such excess as quickly as possible; provided, that an
         allocation pursuant to this Section 6.1(d)(v) shall be made only if and
         to the extent that such Partner would have a deficit balance in its
         Capital Account as adjusted after all other allocations provided for in
         this Section 6.1 have been tentatively made as if this Section
         6.1(d)(v) were not in this Agreement.



                                       49
<PAGE>



                  (vi) Nonrecourse Deductions. Nonrecourse Deductions for any
         taxable period shall be allocated to the Partners in accordance with
         their respective Percentage Interests. If the General Partner
         determines in its good faith discretion that the Partnership's
         Nonrecourse Deductions must be allocated in a different ratio to
         satisfy the safe harbor requirements of the Treasury Regulations
         promulgated under Section 704(b) of the Code, the General Partner is
         authorized, upon notice to the other Partners, to revise the prescribed
         ratio to the numerically closest ratio that does satisfy such
         requirements.

                  (vii) Partner Nonrecourse Deductions. Partner Nonrecourse
         Deductions for any taxable period shall be allocated 100% to the
         Partner that bears the Economic Risk of Loss with respect to the
         Partner Nonrecourse Debt to which such Partner Nonrecourse Deductions
         are attributable in accordance with Treasury Regulation Section
         1.704-2(i). If more than one Partner bears the Economic Risk of Loss
         with respect to a Partner Nonrecourse Debt, such Partner Nonrecourse
         Deductions attributable thereto shall be allocated between or among
         such Partners in accordance with the ratios in which they share such
         Economic Risk of Loss.

                  (viii) Nonrecourse Liabilities. For purposes of Treasury
         Regulation Section 1.752-3(a)(3), the Partners agree that Nonrecourse
         Liabilities of the Partnership in excess of the sum of (A) the amount
         of Partnership Minimum Gain and (B) the total amount of Nonrecourse
         Built-in Gain shall be allocated among the Partners in accordance with
         their respective Percentage Interests.

                  (ix) Code Section 754 Adjustments. To the extent an adjustment
         to the adjusted tax basis of any Partnership asset pursuant to Section
         734(b) or 743(c) of the Code is required, pursuant to Treasury
         Regulation Section 1.704-1(b)(2)(iv)(m), to be taken into account in
         determining Capital Accounts, the amount of such adjustment to the
         Capital Accounts shall be treated as an item of gain (if the adjustment
         increases the basis of the asset) or loss (if the adjustment decreases
         such basis), and such item of gain or loss shall be specially allocated
         to the Partners in a manner consistent with the manner in which their
         Capital Accounts are required to be adjusted pursuant to such Section
         of the Treasury Regulations.

                  (x) Economic Uniformity. At the election of the General
         Partner with respect to any taxable period ending upon, or after, the
         termination of the Subordination Period, all or a portion of the
         remaining items of Partnership gross income or gain for such taxable
         period, after taking into account allocations pursuant to Section
         6.1(d)(iii), shall be allocated 100% to each Partner holding
         Subordinated Units that are Outstanding as of the termination of the
         Subordination Period ("Final Subordinated Units") in the proportion of
         the number of Final Subordinated Units held by such Partner to the
         total number of Final Subordinated Units then Outstanding, until each
         such Partner has been allocated an amount of gross income or gain which
         increases the Capital Account maintained with respect to such Final
         Subordinated Units to an amount equal to the product of (A) the number
         of Final Subordinated Units held by such Partner and (B) the Per Unit
         Capital Amount for a Common Unit. The purpose of this allocation is to
         establish uniformity between the Capital Accounts underlying Final
         Subordinated Units and the Capital Accounts underlying Common Units
         held by Persons other than the



                                       50
<PAGE>



         General Partner and its Affiliates immediately prior to the conversion
         of such Final Subordinated Units into Common Units. This allocation
         method for establishing such economic uniformity will only be available
         to the General Partner if the method for allocating the Capital Account
         maintained with respect to the Subordinated Units between the
         transferred and retained Subordinated Units pursuant to Section
         5.5(c)(ii) does not otherwise provide such economic uniformity to the
         Final Subordinated Units.

                  (xi) Curative Allocation.

                           (A) Notwithstanding any other provision of this
                  Section 6.1, other than the Required Allocations, the Required
                  Allocations shall be taken into account in making the Agreed
                  Allocations so that, to the extent possible, the net amount of
                  items of income, gain, loss and deduction allocated to each
                  Partner pursuant to the Required Allocations and the Agreed
                  Allocations, together, shall be equal to the net amount of
                  such items that would have been allocated to each such Partner
                  under the Agreed Allocations had the Required Allocations and
                  the related Curative Allocation not otherwise been provided in
                  this Section 6.1. Notwithstanding the preceding sentence,
                  Required Allocations relating to (1) Nonrecourse Deductions
                  shall not be taken into account except to the extent that
                  there has been a decrease in Partnership Minimum Gain and (2)
                  Partner Nonrecourse Deductions shall not be taken into account
                  except to the extent that there has been a decrease in Partner
                  Nonrecourse Debt Minimum Gain. Allocations pursuant to this
                  Section 6.1(d)(xi)(A) shall only be made with respect to
                  Required Allocations to the extent the General Partner
                  reasonably determines that such allocations will otherwise be
                  inconsistent with the economic agreement among the Partners.
                  Further, allocations pursuant to this Section 6.1(d)(xi)(A)
                  shall be deferred with respect to allocations pursuant to
                  clauses (1) and (2) hereof to the extent the General Partner
                  reasonably determines that such allocations are likely to be
                  offset by subsequent Required Allocations.

                           (B) The General Partner shall have reasonable
                  discretion, with respect to each taxable period, to (1) apply
                  the provisions of Section 6.1(d)(xi)(A) in whatever order is
                  most likely to minimize the economic distortions that might
                  otherwise result from the Required Allocations, and (2) divide
                  all allocations pursuant to Section 6.1(d)(xi)(A) among the
                  Partners in a manner that is likely to minimize such economic
                  distortions.

                  (xii) Corrective Allocations. In the event of any allocation
         of Additional Book Basis Derivative Items or any Book-Down Event or any
         recognition of a Net Termination Loss, the following rules shall apply:

                           (A) In the case of any allocation of Additional Book
                  Basis Derivative Items (other than an allocation of Unrealized
                  Gain or Unrealized Loss under Section 5.5(d) hereof), the
                  General Partner shall allocate additional items of gross
                  income and gain away from the holders of Incentive
                  Distribution Rights to the Unitholders and the General
                  Partner, or additional items of deduction and loss away from
                  the Unitholders and the General Partner to the holders of
                  Incentive



                                       51
<PAGE>



                  Distribution Rights, to the extent that the Additional Book
                  Basis Derivative Items allocated to the Unitholders or the
                  General Partner exceed their Share of Additional Book Basis
                  Derivative Items. For this purpose, the Unitholders and the
                  General Partner shall be treated as being allocated Additional
                  Book Basis Derivative Items to the extent that such Additional
                  Book Basis Derivative Items have reduced the amount of income
                  that would otherwise have been allocated to the Unitholders or
                  the General Partner under the Partnership Agreement (e.g.,
                  Additional Book Basis Derivative Items taken into account in
                  computing cost of goods sold would reduce the amount of book
                  income otherwise available for allocation among the Partners).
                  Any allocation made pursuant to this Section 6.1(d)(xii)(A)
                  shall be made after all of the other Agreed Allocations have
                  been made as if this Section 6.1(d)(xii) were not in this
                  Agreement and, to the extent necessary, shall require the
                  reallocation of items that have been allocated pursuant to
                  such other Agreed Allocations.

                           (B) In the case of any negative adjustments to the
                  Capital Accounts of the Partners resulting from a Book-Down
                  Event or from the recognition of a Net Termination Loss, such
                  negative adjustment (1) shall first be allocated, to the
                  extent of the Aggregate Remaining Net Positive Adjustments, in
                  such a manner, as reasonably determined by the General
                  Partner, that to the extent possible the aggregate Capital
                  Accounts of the Partners will equal the amount which would
                  have been the Capital Account balance of the Partners if no
                  prior Book-Up Events had occurred, and (2) any negative
                  adjustment in excess of the Aggregate Remaining Net Positive
                  Adjustments shall be allocated pursuant to Section 6.1(c)
                  hereof.

                           (C) In making the allocations required under this
                  Section 6.1(d)(xii), the General Partner, in its sole
                  discretion, may apply whatever conventions or other
                  methodology it deems reasonable to satisfy the purpose of this
                  Section 6.1(d)(xii).

         Section 6.2 Allocations for Tax Purposes.

         (a) Except as otherwise provided herein, for federal income tax
purposes, each item of income, gain, loss and deduction shall be allocated among
the Partners in the same manner as its correlative item of "book" income, gain,
loss or deduction is allocated pursuant to Section 6.1.

         (b) In an attempt to eliminate Book-Tax Disparities attributable to a
Contributed Property or Adjusted Property, items of income, gain, loss,
depreciation, amortization and cost recovery deductions shall be allocated for
federal income tax purposes among the Partners as follows:

                  (i) (A) In the case of a Contributed Property, such items
         attributable thereto shall be allocated among the Partners in the
         manner provided under Section 704(c) of the Code that takes into
         account the variation between the Agreed Value of such property and its
         adjusted basis at the time of contribution; and (B) any item of
         Residual Gain or Residual Loss attributable to a Contributed Property
         shall be allocated among the



                                       52
<PAGE>



         Partners in the same manner as its correlative item of "book" gain or
         loss is allocated pursuant to Section 6.1.

                  (ii) (A) In the case of an Adjusted Property, such items shall
         (1) first, be allocated among the Partners in a manner consistent with
         the principles of Section 704(c) of the Code to take into account the
         Unrealized Gain or Unrealized Loss attributable to such property and
         the allocations thereof pursuant to Section 5.5(d)(i) or 5.5(d)(ii),
         and (2) second, in the event such property was originally a Contributed
         Property, be allocated among the Partners in a manner consistent with
         Section 6.2(b)(i)(A); and (B) any item of Residual Gain or Residual
         Loss attributable to an Adjusted Property shall be allocated among the
         Partners in the same manner as its correlative item of "book" gain or
         loss is allocated pursuant to Section 6.1.

                  (iii) The General Partner shall apply the principles of
         Treasury Regulation Section 1.704-3(d) to eliminate Book-Tax
         Disparities.

         (c) For the proper administration of the Partnership and for the
preservation of uniformity of the Limited Partner Interests (or any class or
classes thereof), the General Partner shall have sole discretion to (i) adopt
such conventions as it deems appropriate in determining the amount of
depreciation, amortization and cost recovery deductions; (ii) make special
allocations for federal income tax purposes of income (including, without
limitation, gross income) or deductions; and (iii) amend the provisions of this
Agreement as appropriate (x) to reflect the proposal or promulgation of Treasury
Regulations under Section 704(b) or Section 704(c) of the Code or (y) otherwise
to preserve or achieve uniformity of the Limited Partner Interests (or any class
or classes thereof). The General Partner may adopt such conventions, make such
allocations and make such amendments to this Agreement as provided in this
Section 6.2(c) only if such conventions, allocations or amendments would not
have a material adverse effect on the Partners, the holders of any class or
classes of Limited Partner Interests issued and Outstanding or the Partnership,
and if such allocations are consistent with the principles of Section 704 of the
Code.

         (d) The General Partner in its discretion may determine to depreciate
or amortize the portion of an adjustment under Section 743(b) of the Code
attributable to unrealized appreciation in any Adjusted Property (to the extent
of the unamortized Book-Tax Disparity) using a predetermined rate derived from
the depreciation or amortization method and useful life applied to the
Partnership's common basis of such property, despite any inconsistency of such
approach with Treasury Regulation Section 1.167(c)-l(a)(6) or any successor
regulations thereto. If the General Partner determines that such reporting
position cannot reasonably be taken, the General Partner may adopt depreciation
and amortization conventions under which all purchasers acquiring Limited
Partner Interests in the same month would receive depreciation and amortization
deductions, based upon the same applicable rate as if they had purchased a
direct interest in the Partnership's property. If the General Partner chooses
not to utilize such aggregate method, the General Partner may use any other
reasonable depreciation and amortization conventions to preserve the uniformity
of the intrinsic tax characteristics of any Limited Partner Interests that would
not have a material adverse effect on the Limited Partners or the Record Holders
of any class or classes of Limited Partner Interests.



                                       53
<PAGE>



         (e) Any gain allocated to the Partners upon the sale or other taxable
disposition of any Partnership asset shall, to the extent possible, after taking
into account other required allocations of gain pursuant to this Section 6.2, be
characterized as Recapture Income in the same proportions and to the same extent
as such Partners (or their predecessors in interest) have been allocated any
deductions directly or indirectly giving rise to the treatment of such gains as
Recapture Income.

         (f) All items of income, gain, loss, deduction and credit recognized by
the Partnership for federal income tax purposes and allocated to the Partners in
accordance with the provisions hereof shall be determined without regard to any
election under Section 754 of the Code which may be made by the Partnership;
provided, however, that such allocations, once made, shall be adjusted as
necessary or appropriate to take into account those adjustments permitted or
required by Sections 734 and 743 of the Code.

         (g) Each item of Partnership income, gain, loss and deduction shall for
federal income tax purposes, be determined on an annual basis and prorated on a
monthly basis and shall be allocated to the Partners as of the opening of the
Nasdaq National Market on the first Business Day of each month; provided,
however, that (i) such items for the period beginning on the Closing Date and
ending on the last day of the month in which the Option Closing Date or the
expiration of the Over-allotment Option occurs shall be allocated to the
Partners as of the opening of the Nasdaq National Market on the first Business
Day of the next succeeding month; and provided, further, that gain or loss on a
sale or other disposition of any assets of the Partnership or any other
extraordinary item of income or loss realized and recognized other than in the
ordinary course of business, as determined by the General Partner in its sole
discretion, shall be allocated to the Partners as of the opening of the Nasdaq
National Market on the first Business Day of the month in which such gain or
loss is recognized for federal income tax purposes. The General Partner may
revise, alter or otherwise modify such methods of allocation as it determines
necessary or appropriate in its sole discretion, to the extent permitted or
required by Section 706 of the Code and the regulations or rulings promulgated
thereunder.

         (h) Allocations that would otherwise be made to a Limited Partner under
the provisions of this Article VI shall instead be made to the beneficial owner
of Limited Partner Interests held by a nominee in any case in which the nominee
has furnished the identity of such owner to the Partnership in accordance with
Section 6031(c) of the Code or any other method acceptable to the General
Partner in its sole discretion.

         Section 6.3 Requirement and Characterization of Distributions;
Distributions to Record Holders.

         (a) Within 45 days following the end of each Quarter commencing with
the Quarter ending on December 31, 2002, an amount equal to 100% of Available
Cash with respect to such Quarter shall, subject to Section 17-607 of the
Delaware Act, be distributed in accordance with this Article VI by the
Partnership to the Partners as of the Record Date selected by the General
Partner in its reasonable discretion. All amounts of Available Cash distributed
by the Partnership on any date from any source shall be deemed to be Operating
Surplus until the sum of all amounts of Available Cash theretofore distributed
by the Partnership to the Partners pursuant to Section 6.4 equals the Operating
Surplus from the Closing Date through the close of the



                                       54
<PAGE>



immediately preceding Quarter. Any remaining amounts of Available Cash
distributed by the Partnership on such date shall, except as otherwise provided
in Section 6.5, be deemed to be "Capital Surplus." All distributions required to
be made under this Agreement shall be made subject to Section 17-607 of the
Delaware Act.

         (b) Notwithstanding Section 6.3(a), in the event of the dissolution and
liquidation of the Partnership, all receipts received during or after the
Quarter in which the Liquidation Date occurs, other than from borrowings
described in (a)(ii) of the definition of Available Cash, shall be applied and
distributed solely in accordance with, and subject to the terms and conditions
of, Section 12.4.

         (c) The General Partner shall have the discretion to treat taxes paid
by the Partnership on behalf of, or amounts withheld with respect to, all or
less than all of the Partners, as a distribution of Available Cash to such
Partners.

         (d) Each distribution in respect of a Partnership Interest shall be
paid by the Partnership, directly or through the Transfer Agent or through any
other Person or agent, only to the Record Holder of such Partnership Interest as
of the Record Date set for such distribution. Such payment shall constitute full
payment and satisfaction of the Partnership's liability in respect of such
payment, regardless of any claim of any Person who may have an interest in such
payment by reason of an assignment or otherwise.

         Section 6.4 Distributions of Available Cash from Operating Surplus.

         (a) During the Subordination Period. Available Cash with respect to any
Quarter within the Subordination Period that is deemed to be Operating Surplus
pursuant to the provisions of Section 6.3 or 6.5 shall, subject to Section
17-607 of the Delaware Act, be distributed as follows, except as otherwise
required by Section 5.6(b) in respect of additional Partnership Securities
issued pursuant thereto:

                  (i) First, 98% to the Unitholders holding Common Units, Pro
         Rata, and 2% to the General Partner, until there has been distributed
         in respect of each Common Unit then Outstanding an amount equal to the
         Minimum Quarterly Distribution for such Quarter;

                  (ii) Second, 98% to the Unitholders holding Common Units, Pro
         Rata, and 2% to the General Partner, until there has been distributed
         in respect of each Common Unit then Outstanding an amount equal to the
         Cumulative Common Unit Arrearage existing with respect to such Quarter;

                  (iii) Third, 98% to the Unitholders holding Subordinated
         Units, Pro Rata, and 2% to the General Partner, until there has been
         distributed in respect of each Subordinated Unit then Outstanding an
         amount equal to the Minimum Quarterly Distribution for such Quarter;

                  (iv) Fourth, 98% to all Unitholders, Pro Rata, and 2% to the
         General Partner, until there has been distributed in respect of each
         Unit then Outstanding an amount equal to the excess of the First Target
         Distribution over the Minimum Quarterly Distribution for such Quarter;



                                       55
<PAGE>



                  (v) Fifth, 85% to all Unitholders, Pro Rata, 13% to the
         holders of the Incentive Distribution Rights, Pro Rata, and 2% to the
         General Partner, until there has been distributed in respect of each
         Unit then Outstanding an amount equal to the excess of the Second
         Target Distribution over the First Target Distribution for such
         Quarter;

                  (vi) Sixth, 75% to all Unitholders, Pro Rata, 23% to the
         holders of the Incentive Distribution Rights, Pro Rata, and 2% to the
         General Partner, until there has been distributed in respect of each
         Unit then Outstanding an amount equal to the excess of the Third Target
         Distribution over the Second Target Distribution for such Quarter; and

                  (vii) Thereafter, 50% to all Unitholders, Pro Rata, 48% to the
         holders of the Incentive Distribution Rights, Pro Rata, and 2% to the
         General Partner;

provided, however, if the Minimum Quarterly Distribution, the First Target
Distribution, the Second Target Distribution and the Third Target Distribution
have been reduced to zero pursuant to the second sentence of Section 6.6(a), the
distribution of Available Cash that is deemed to be Operating Surplus with
respect to any Quarter will be made solely in accordance with Section
6.4(a)(vii).

         (b) After the Subordination Period. Available Cash with respect to any
Quarter after the Subordination Period that is deemed to be Operating Surplus
pursuant to the provisions of Section 6.3 or 6.5, subject to Section 17-607 of
the Delaware Act, shall be distributed as follows, except as otherwise required
by Section 5.6(b) in respect of additional Partnership Securities issued
pursuant thereto:

                  (i) First, 98% to all Unitholders, Pro Rata, and 2% to the
         General Partner, until there has been distributed in respect of each
         Unit then Outstanding an amount equal to the Minimum Quarterly
         Distribution for such Quarter;

                  (ii) Second, 98% to all Unitholders, Pro Rata, and 2% to the
         General Partner, until there has been distributed in respect of each
         Unit then Outstanding an amount equal to the excess of the First Target
         Distribution over the Minimum Quarterly Distribution for such Quarter;

                  (iii) Third, 85% to all Unitholders, Pro Rata, 13% to the
         holders of the Incentive Distribution Rights, Pro Rata, and 2% to the
         General Partner, until there has been distributed in respect of each
         Unit then Outstanding an amount equal to the excess of the Second
         Target Distribution over the First Target Distribution for such
         Quarter;

                  (iv) Fourth, 75% to all Unitholders, Pro Rata, 23% to the
         holders of the Incentive Distribution Rights, Pro Rata, and 2% to the
         General Partner, until there has been distributed in respect of each
         Unit then Outstanding an amount equal to the excess of the Third Target
         Distribution over the Second Target Distribution for such Quarter; and

                  (v) Thereafter, 50% to all Unitholders, Pro Rata, 48% to the
         holders of the Incentive Distribution Rights, Pro Rata, and 2% to the
         General Partner;



                                       56
<PAGE>



provided, however, if the Minimum Quarterly Distribution, the First Target
Distribution, the Second Target Distribution and the Third Target Distribution
have been reduced to zero pursuant to the second sentence of Section 6.6(a), the
distribution of Available Cash that is deemed to be Operating Surplus with
respect to any Quarter will be made solely in accordance with Section 6.4(b)(v).

         Section 6.5 Distributions of Available Cash from Capital Surplus.
Available Cash that is deemed to be Capital Surplus pursuant to the provisions
of Section 6.3(a) shall, subject to Section 17-607 of the Delaware Act, be
distributed, unless the provisions of Section 6.3 require otherwise, 98% to all
Unitholders, Pro Rata, and 2% to the General Partner, until a hypothetical
holder of an Initial Common Unit has received with respect to such Common Unit,
during the period since the Closing Date through such date, distributions of
Available Cash that are deemed to be Capital Surplus in an aggregate amount
equal to the Initial Unit Price. Available Cash that is deemed to be Capital
Surplus shall then be distributed 98% to all Unitholders holding Common Units,
Pro Rata, and 2% to the General Partner, until there has been distributed in
respect of each Common Unit then Outstanding an amount equal to the Cumulative
Common Unit Arrearage. Thereafter, all Available Cash shall be distributed as if
it were Operating Surplus and shall be distributed in accordance with Section
6.4.

         Section 6.6 Adjustment of Minimum Quarterly Distribution and Target
Distribution Levels.

         (a) The Minimum Quarterly Distribution, First Target Distribution,
Second Target Distribution, Third Target Distribution, Common Unit Arrearages
and Cumulative Common Unit Arrearages shall be proportionately adjusted in the
event of any distribution, combination or subdivision (whether effected by a
distribution payable in Units or otherwise) of Units or other Partnership
Securities in accordance with Section 5.10. In the event of a distribution of
Available Cash that is deemed to be from Capital Surplus, the then applicable
Minimum Quarterly Distribution, First Target Distribution, Second Target
Distribution and Third Target Distribution, shall be adjusted proportionately
downward to equal the product obtained by multiplying the otherwise applicable
Minimum Quarterly Distribution, First Target Distribution, Second Target
Distribution and Third Target Distribution, as the case may be, by a fraction of
which the numerator is the Unrecovered Capital of the Common Units immediately
after giving effect to such distribution and of which the denominator is the
Unrecovered Capital of the Common Units immediately prior to giving effect to
such distribution.

         (b) The Minimum Quarterly Distribution, First Target Distribution,
Second Target Distribution and Third Target Distribution, shall also be subject
to adjustment pursuant to Section 6.9.

         Section 6.7 Special Provisions Relating to the Holders of Subordinated
Units.

         (a) Except with respect to the right to vote on or approve matters
requiring the vote or approval of a percentage of the holders of Outstanding
Common Units and the right to participate in allocations of income, gain, loss
and deduction and distributions made with respect to Common Units, the holder of
a Subordinated Unit shall have all of the rights and obligations of a Unitholder
holding Common Units hereunder; provided, however, that immediately upon



                                       57
<PAGE>



the conversion of Subordinated Units into Common Units pursuant to Section 5.8,
the Unitholder holding a Subordinated Unit shall possess all of the rights and
obligations of a Unitholder holding Common Units hereunder, including the right
to vote as a Common Unitholder and the right to participate in allocations of
income, gain, loss and deduction and distributions made with respect to Common
Units; provided, however, that such converted Subordinated Units shall remain
subject to the provisions of Sections 5.5(c)(ii), 6.1(d)(x) and 6.7(b).

         (b) The Unitholder holding a Subordinated Unit which has converted into
a Common Unit pursuant to Section 5.8 shall not be issued a Common Unit
Certificate pursuant to Section 4.1, and shall not be permitted to transfer its
converted Subordinated Units to a Person which is not an Affiliate of the holder
until such time as the General Partner determines, based on advice of counsel,
that a converted Subordinated Unit should have, as a substantive matter, like
intrinsic economic and federal income tax characteristics, in all material
respects, to the intrinsic economic and federal income tax characteristics of an
Initial Common Unit. In connection with the condition imposed by this Section
6.7(b), the General Partner may take whatever reasonable steps are required to
provide economic uniformity to the converted Subordinated Units in preparation
for a transfer of such converted Subordinated Units, including the application
of Sections 5.5(c)(ii) and 6.1(d)(x); provided, however, that no such steps may
be taken that would have a material adverse effect on the Unitholders holding
Common Units represented by Common Unit Certificates.

         Section 6.8 Special Provisions Relating to the Holders of Incentive
Distribution Rights. Notwithstanding anything to the contrary set forth in this
Agreement, the holders of the Incentive Distribution Rights (a) shall (i)
possess the rights and obligations provided in this Agreement with respect to a
Limited Partner pursuant to Articles III and VII and (ii) have a Capital Account
as a Partner pursuant to Section 5.5 and all other provisions related thereto
and (b) shall not (i) be entitled to vote on any matters requiring the approval
or vote of the holders of Outstanding Units, (ii) be entitled to any
distributions other than as provided in Sections 6.4(a)(v), (vi) and (vii),
6.4(b)(iii), (iv) and (v), and 12.4 or (iii) be allocated items of income, gain,
loss or deduction other than as specified in this Article VI.

         Section 6.9 Entity-Level Taxation. If legislation is enacted or the
interpretation of existing language is modified by the relevant governmental
authority which causes a Group Member to be treated as an association taxable as
a corporation or otherwise subjects a Group Member to entity-level taxation for
federal, state or local income tax purposes, the then applicable Minimum
Quarterly Distribution, First Target Distribution, Second Target Distribution
and Third Target Distribution, shall be adjusted to equal the product obtained
by multiplying (a) the amount thereof by (b) one minus the sum of (i) the
highest marginal federal corporate (or other entity, as applicable) income tax
rate of the Group Member for the taxable year of the Group Member in which such
Quarter occurs (expressed as a percentage) plus (ii) the effective overall state
and local income tax rate (expressed as a percentage) applicable to the Group
Member for the calendar year next preceding the calendar year in which such
Quarter occurs (after taking into account the benefit of any deduction allowable
for federal income tax purposes with respect to the payment of state and local
income taxes), but only to the extent of the increase in such rates resulting
from such legislation or interpretation. Such effective overall state and local
income tax rate shall be determined for the taxable year next preceding the
first taxable year during which the Group Member is taxable for federal income
tax purposes as an



                                       58
<PAGE>



association taxable as a corporation or is otherwise subject to entity-level
taxation by determining such rate as if the Group Member had been subject to
such state and local taxes during such preceding taxable year.

                                   ARTICLE VII
                      MANAGEMENT AND OPERATION OF BUSINESS

         Section 7.1 Management.

         (a) The General Partner shall conduct, direct and manage all activities
of the Partnership. Except as otherwise expressly provided in this Agreement,
all management powers over the business and affairs of the Partnership shall be
exclusively vested in the General Partner, and no Limited Partner or Assignee
shall have any management power over the business and affairs of the
Partnership. In addition to the powers now or hereafter granted a general
partner of a limited partnership under applicable law or which are granted to
the General Partner under any other provision of this Agreement, the General
Partner, subject to Section 7.3, shall have full power and authority to do all
things and on such terms as it, in its sole discretion, may deem necessary or
appropriate to conduct the business of the Partnership, to exercise all powers
set forth in Section 2.5 and to effectuate the purposes set forth in Section
2.4, including the following:

                  (i) the making of any expenditures, the lending or borrowing
         of money, the assumption or guarantee of, or other contracting for,
         indebtedness and other liabilities, the issuance of evidences of
         indebtedness, including indebtedness that is convertible into
         Partnership Securities, and the incurring of any other obligations;

                  (ii) the making of tax, regulatory and other filings, or
         rendering of periodic or other reports to governmental or other
         agencies having jurisdiction over the business or assets of the
         Partnership;

                  (iii) the acquisition, disposition, mortgage, pledge,
         encumbrance, hypothecation or exchange of any or all of the assets of
         the Partnership or the merger or other combination of the Partnership
         with or into another Person (the matters described in this clause (iii)
         being subject, however, to any prior approval that may be required by
         Section 7.3);

                  (iv) the use of the assets of the Partnership (including cash
         on hand) for any purpose consistent with the terms of this Agreement,
         including the financing of the conduct of the operations of the
         Partnership Group; subject to Section 7.6(a), the lending of funds to
         other Persons (including other Group Members), the repayment or
         guarantee of obligations of the Partnership Group and the making of
         capital contributions to any member of the Partnership Group;

                  (v) the negotiation, execution and performance of any
         contracts, conveyances or other instruments (including instruments that
         limit the liability of the Partnership under contractual arrangements
         to all or particular assets of the Partnership, with the other party to
         the contract to have no recourse against the General Partner or its
         assets other than its



                                       59
<PAGE>



         interest in the Partnership, even if same results in the terms of the
         transaction being less favorable to the Partnership than would
         otherwise be the case);

                  (vi) the distribution of Partnership cash;

                  (vii) the selection and dismissal of employees (including
         employees having titles such as "president," "vice president,"
         "secretary" and "treasurer") and agents, outside attorneys,
         accountants, consultants and contractors and the determination of their
         compensation and other terms of employment or hiring;

                  (viii) the maintenance of such insurance for the benefit of
         the Partnership Group and the Partners as it deems necessary or
         appropriate;

                  (ix) the formation of, or acquisition of an interest in, and
         the contribution of property and the making of loans to, any other
         limited or general partnerships, joint ventures, corporations, limited
         liability companies or other relationships (including the acquisition
         of interests in, and the contributions of property to, any Group Member
         from time to time) subject to the restrictions set forth in Section
         2.4;

                  (x) the control of any matters affecting the rights and
         obligations of the Partnership, including the bringing and defending of
         actions at law or in equity and otherwise engaging in the conduct of
         litigation and the incurring of legal expense and the settlement of
         claims and litigation;

                  (xi) the indemnification of any Person against liabilities and
         contingencies to the extent permitted by law;

                  (xii) the entering into of listing agreements with any
         National Securities Exchange and the delisting of some or all of the
         Limited Partner Interests from, or requesting that trading be suspended
         on, any such exchange (subject to any prior approval that may be
         required under Section 4.8);

                  (xiii) unless restricted or prohibited by Section 5.7, the
         purchase, sale or other acquisition or disposition of Partnership
         Securities, or the issuance of additional options, rights, warrants and
         appreciation rights relating to Partnership Securities; and

                  (xiv) the undertaking of any action in connection with the
         Partnership's participation in the Operating Partnership or any other
         subsidiary of the Partnership as a member or partner.

         (b) Notwithstanding any other provision of this Agreement, the
Operating Partnership Agreement, the Delaware Act or any applicable law, rule or
regulation, each of the Partners and the Assignees and each other Person who may
acquire an interest in Partnership Securities hereby (i) approves, ratifies and
confirms the execution, delivery and performance by the parties thereto of the
Operating Partnership Agreement, the Underwriting Agreement, the Omnibus
Agreement, the Contribution Agreement and the other agreements described in or
filed as exhibits to the Registration Statement that are related to the
transactions contemplated by the Registration Statement; (ii) agrees that the
General Partner (on its own or through any officer of



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the Partnership) is authorized to execute, deliver and perform the agreements
referred to in clause (i) of this sentence and the other agreements, acts,
transactions and matters described in or contemplated by the Registration
Statement on behalf of the Partnership without any further act, approval or vote
of the Partners or the Assignees or the other Persons who may acquire an
interest in Partnership Securities; and (iii) agrees that the execution,
delivery or performance by the General Partner, any Group Member or any
Affiliate of any of them, of this Agreement or any agreement authorized or
permitted under this Agreement (including the exercise by the General Partner or
any Affiliate of the General Partner of the rights accorded pursuant to Article
XV), shall not constitute a breach by the General Partner of any duty that the
General Partner may owe the Partnership or the Limited Partners or any other
Persons under this Agreement (or any other agreements) or of any duty stated or
implied by law or equity.

         Section 7.2 Certificate of Limited Partnership. The General Partner has
caused the Certificate of Limited Partnership to be filed with the Secretary of
State of the State of Delaware as required by the Delaware Act. The General
Partner shall use all reasonable efforts to cause to be filed such other
certificates or documents as may be determined by the General Partner in its
sole discretion to be reasonable and necessary or appropriate for the formation,
continuation, qualification and operation of a limited partnership (or a
partnership in which the limited partners have limited liability) in the State
of Delaware or any other state in which the Partnership may elect to do business
or own property. To the extent that such action is determined by the General
Partner in its sole discretion to be reasonable and necessary or appropriate,
the General Partner shall file amendments to and restatements of the Certificate
of Limited Partnership and do all things to maintain the Partnership as a
limited partnership (or a partnership or other entity in which the limited
partners have limited liability) under the laws of the State of Delaware or of
any other state in which the Partnership may elect to do business or own
property. Subject to the terms of Section 3.4(a), the General Partner shall not
be required, before or after filing, to deliver or mail a copy of the
Certificate of Limited Partnership, any qualification document or any amendment
thereto to any Limited Partner.

         Section 7.3 Restrictions on the General Partner's Authority.

         (a) The General Partner may not, without written approval of the
specific act by holders of all of the Outstanding Limited Partner Interests or
by other written instrument executed and delivered by holders of all of the
Outstanding Limited Partner Interests subsequent to the date of this Agreement,
take any action in contravention of this Agreement, including, except as
otherwise provided in this Agreement, (i) committing any act that would make it
impossible to carry on the ordinary business of the Partnership; (ii) possessing
Partnership property, or assigning any rights in specific Partnership property,
for other than a Partnership purpose; (iii) admitting a Person as a Partner;
(iv) amending this Agreement in any manner; or (v) transferring its interest as
a general partner of the Partnership.

         (b) Except as provided in Articles XII and XIV, the General Partner may
not sell, exchange or otherwise dispose of all or substantially all of the
Partnership's assets in a single transaction or a series of related transactions
(including by way of merger, consolidation or other combination) or approve on
behalf of the Partnership the sale, exchange or other disposition of all or
substantially all of the assets of the Operating Partnership without the
approval of holders of a Unit Majority; provided however that this provision
shall not preclude or limit the General



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Partner's ability to mortgage, pledge, hypothecate or grant a security interest
in all or substantially all of the assets of the Partnership or the Operating
Partnership and shall not apply to any forced sale of any or all of the assets
of the Partnership or the Operating Partnership pursuant to the foreclosure of,
or other realization upon, any such encumbrance. Without the approval of holders
of a Unit Majority, the General Partner shall not, on behalf of the Partnership,
(i) consent to any amendment to the Operating Partnership Agreement or (ii)
except as expressly permitted by Section 7.9(d), take any action permitted to be
taken by a partner of the Operating Partnership, in either case, that would
adversely affect the Limited Partners (including any particular class of
Partnership Interests as compared to any other class of Partnership Interests)
in any material respect, except, in either case, as permitted under Sections
4.6, 11.1 and 11.2 with respect to the election of a successor general partner
or managing member of any Group Member.

         Section 7.4 Reimbursement of the General Partner.

         (a) Except as provided in this Section 7.4 and elsewhere in this
Agreement, the General Partner shall not be compensated for its services as a
general partner or managing member of any Group Member.

         (b) The General Partner shall be reimbursed on a monthly basis, or such
other reasonable basis as the General Partner may determine in its sole
discretion, for (i) all direct and indirect expenses it incurs or payments it
makes on behalf of the Partnership (including salary, bonus, incentive
compensation and other amounts paid to any Person including Affiliates of the
General Partner to perform services for the Partnership or for the General
Partner in the discharge of its duties to the Partnership), and (ii) all other
necessary or appropriate expenses allocable to the Partnership or otherwise
reasonably incurred by the General Partner in connection with operating the
Partnership's business (including expenses allocated to the General Partner by
its Affiliates). The General Partner shall determine the expenses that are
allocable to the Partnership in any reasonable manner determined by the General
Partner in its sole discretion. Reimbursements pursuant to this Section 7.4
shall be in addition to any reimbursement to the General Partner as a result of
indemnification pursuant to Section 7.7.

         (c) Subject to Section 5.7, the General Partner, in its sole discretion
and without the approval of the Limited Partners (who shall have no right to
vote in respect thereof), may propose and adopt on behalf of the Partnership
employee benefit plans, employee programs and employee practices (including
plans, programs and practices involving the issuance of Partnership Securities
or options to purchase Partnership Securities), or cause the Partnership to
issue Partnership Securities in connection with, or pursuant to, any employee
benefit plan, employee program or employee practice maintained or sponsored by
the General Partner or any of its Affiliates, in each case for the benefit of
employees of the General Partner, any Group Member or any Affiliate, or any of
them, in respect of services performed, directly or indirectly, for the benefit
of the Partnership Group. The Partnership agrees to issue and sell to the
General Partner or any of its Affiliates any Partnership Securities that the
General Partner or such Affiliates are obligated to provide to any employees
pursuant to any such employee benefit plans, employee programs or employee
practices. Expenses incurred by the General Partner in connection with any such
plans, programs and practices (including the net cost to the General Partner or
such Affiliates of Partnership Securities purchased by the General Partner or
such



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<PAGE>



Affiliates from the Partnership to fulfill options or awards under such plans,
programs and practices) shall be reimbursed in accordance with Section 7.4(b).
Any and all obligations of the General Partner under any employee benefit plans,
employee programs or employee practices adopted by the General Partner as
permitted by this Section 7.4(c) shall constitute obligations of the General
Partner hereunder and shall be assumed by any successor General Partner approved
pursuant to Section 11.1 or 11.2 or the transferee of or successor to all of the
General Partner's General Partner Interest pursuant to Section 4.6.

         Section 7.5 Outside Activities.

         (a) After the Closing Date, the General Partner, for so long as it is
the General Partner of the Partnership agrees that its sole business will be to
act as a general partner or managing member, as the case may be, of the
Partnership and any other partnership or limited liability company of which the
Partnership or the Operating Partnership is, directly or indirectly, a partner
or member and to undertake activities that are ancillary or related thereto
(including being a limited partner in the Partnership).

         (b) Martin Resource Management Corporation has entered into the Omnibus
Agreement with the General Partner, and the Partnership, which agreement sets
forth certain restrictions on the ability of Martin Resource Management
Corporation and its Affiliates to engage in the Business.

         (c) Except as specifically restricted by Section 7.5(a) and the Omnibus
Agreement, each Indemnitee (other than the General Partner) shall have the right
to engage in businesses of every type and description and other activities for
profit and to engage in and possess an interest in other business ventures of
any and every type or description, whether in businesses engaged in or
anticipated to be engaged in by any Group Member, independently or with others,
including business interests and activities in direct competition with the
business and activities of any Group Member, and none of the same shall
constitute a breach of this Agreement or any duty express or implied by law to
any Group Member or any Partner or Assignee. Neither any Group Member, any
Limited Partner nor any other Person shall have any rights by virtue of this
Agreement, the Operating Partnership Agreement, the limited liability company or
partnership agreement of any other Group Member or the partnership relationship
established hereby or thereby in any business ventures of any Indemnitee.

         (d) Subject to the terms of Section 7.5(a), Section 7.5(b), Section
7.5(c) and the Omnibus Agreement, but otherwise notwithstanding anything to the
contrary in this Agreement, (i) the engaging in competitive activities by any
Indemnitees (other than the General Partner) in accordance with the provisions
of this Section 7.5 is hereby approved by the Partnership and all Partners, (ii)
it shall be deemed not to be a breach of the General Partner's fiduciary duty or
any other obligation of any type whatsoever of the General Partner for the
Indemnitees (other than the General Partner) to engage in such business
interests and activities in preference to or to the exclusion of the Partnership
and (iii) except as set forth in the Omnibus Agreement, Martin Resource
Management Corporation, the General Partner and the Indemnitees shall have no
obligation to present business opportunities to the Partnership.



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         (e) The General Partner and any of its Affiliates may acquire Units or
other Partnership Securities in addition to those acquired on the Closing Date
and, except as otherwise provided in this Agreement, shall be entitled to
exercise all rights of the General Partner or Limited Partner, as applicable,
relating to such Units or Partnership Securities.

         (f) The term "Affiliates" when used in Section 7.5(a) and Section
7.5(e) with respect to the General Partner shall not include any Group Member or
any Subsidiary of the Group Member.

         (g) Anything in this Agreement to the contrary notwithstanding, to the
extent that provisions of Sections 7.7, 7.8, 7.9, 7.10 or other Sections of this
Agreement purport or are interpreted to have the effect of restricting the
fiduciary duties that might otherwise, as a result of Delaware or other
applicable law, be owed by the General Partner to the Partnership and its
Limited Partners, or to constitute a waiver or consent by the Limited Partners
to any such restriction, such provisions shall be inapplicable and have no
effect in determining whether the General Partner has complied with its
fiduciary duties in connection with determinations made by it under this Section
7.5.

         Section 7.6 Loans from the General Partner; Loans or Contributions from
the Partnership; Contracts with Affiliates; Certain Restrictions on the General
Partner.

         (a) The General Partner or any of its Affiliates may lend to any Group
Member, and any Group Member may borrow from the General Partner or any of its
Affiliates, funds needed or desired by the Group Member for such periods of time
and in such amounts as the General Partner may determine; provided, however,
that in any such case the lending party may not charge the borrowing party
interest at a rate greater than the rate that would be charged the borrowing
party or impose terms less favorable to the borrowing party than would be
charged or imposed on the borrowing party by unrelated lenders on comparable
loans made on an arm's-length basis (without reference to the lending party's
financial abilities or guarantees). The borrowing party shall reimburse the
lending party for any costs (other than any additional interest costs) incurred
by the lending party in connection with the borrowing of such funds. For
purposes of this Section 7.6(a) and Section 7.6(b), the term "Group Member"
shall include any Affiliate of a Group Member that is controlled by the Group
Member. No Group Member may lend funds to the General Partner or any of its
Affiliates (other than another Group Member).

         (b) The Partnership may lend or contribute to any Group Member, and any
Group Member may borrow from the Partnership, funds on terms and conditions
established in the sole discretion of the General Partner; provided, however,
that the Partnership may not charge the Group Member interest at a rate less
than the rate that would be charged to the Group Member (without reference to
the General Partner's financial abilities or guarantees) by unrelated lenders on
comparable loans. The foregoing authority shall be exercised by the General
Partner in its sole discretion and shall not create any right or benefit in
favor of any Group Member or any other Person.

         (c) The General Partner may itself, or may enter into an agreement with
any of its Affiliates to, render services to a Group Member or to the General
Partner in the discharge of its duties as General Partner of the Partnership.
Any services rendered to a Group Member by the



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General Partner or any of its Affiliates shall be on terms that are fair and
reasonable to the Partnership; provided, however, that the requirements of this
Section 7.6(c) shall be deemed satisfied as to (i) any transaction approved by
Special Approval, (ii) any transaction, the terms of which are no less favorable
to the Partnership Group than those generally being provided to or available
from unrelated third parties or (iii) any transaction that, taking into account
the totality of the relationships between the parties involved (including other
transactions that may be particularly favorable or advantageous to the
Partnership Group), is equitable to the Partnership Group. The provisions of
Section 7.4 shall apply to the rendering of services described in this Section
7.6(c).

         (d) The Partnership Group may transfer assets to joint ventures, other
partnerships, corporations, limited liability companies or other business
entities in which it is or thereby becomes a participant upon such terms and
subject to such conditions as are consistent with this Agreement and applicable
law.

         (e) Neither the General Partner nor any of its Affiliates shall sell,
transfer or convey any property to, or purchase any property from, the
Partnership, directly or indirectly, except pursuant to transactions that are
fair and reasonable to the Partnership; provided, however, that the requirements
of this Section 7.6(e) shall be deemed to be satisfied as to (i) the
transactions effected pursuant to Sections 5.2 and 5.3, the Contribution
Agreement and any other transactions described in or contemplated by the
Registration Statement, (ii) any transaction approved by Special Approval, (iii)
any transaction, the terms of which are no less favorable to the Partnership
than those generally being provided to or available from unrelated third
parties, or (iv) any transaction that, taking into account the totality of the
relationships between the parties involved (including other transactions that
may be particularly favorable or advantageous to the Partnership), is equitable
to the Partnership. With respect to any contribution of assets to the
Partnership in exchange for Partnership Securities, the Conflicts Committee, in
determining whether the appropriate number of Partnership Securities are being
issued, may take into account, among other things, the fair market value of the
assets, the liquidated and contingent liabilities assumed, the tax basis in the
assets, the extent to which tax-only allocations to the transferor will protect
the existing partners of the Partnership against a low tax basis, and such other
factors as the Conflicts Committee deems relevant under the circumstances.

         (f) The General Partner and its Affiliates will have no obligation to
permit any Group Member to use any facilities or assets of the General Partner
and its Affiliates, except as may be provided in contracts entered into from
time to time specifically dealing with such use, nor shall there be any
obligation on the part of the General Partner or its Affiliates to enter into
such contracts.

         (g) Without limitation of Sections 7.6(a) through 7.6(f), and
notwithstanding anything to the contrary in this Agreement, the existence of the
conflicts of interest described in the Registration Statement are hereby
approved by all Partners.

         Section 7.7 Indemnification.

         (a) To the fullest extent permitted by law but subject to the
limitations expressly provided in this Agreement, all Indemnitees shall be
indemnified and held harmless by the



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Partnership from and against any and all losses, claims, damages, liabilities,
joint or several, expenses (including legal fees and expenses), judgments,
fines, penalties, interest, settlements or other amounts arising from any and
all claims, demands, actions, suits or proceedings, whether civil, criminal,
administrative or investigative, in which any Indemnitee may be involved, or is
threatened to be involved, as a party or otherwise, by reason of its status as
an Indemnitee; provided, that in each case the Indemnitee acted in good faith
and in a manner that such Indemnitee reasonably believed to be in, or (in the
case of a Person other than the General Partner) not opposed to, the best
interests of the Partnership and, with respect to any criminal proceeding, had
no reasonable cause to believe its conduct was unlawful; provided, further, no
indemnification pursuant to this Section 7.7 shall be available to the General
Partner with respect to its obligations incurred pursuant to the Underwriting
Agreement, the Omnibus Agreement or the Contribution Agreement (other than
obligations incurred by the General Partner on behalf of the Partnership). The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere, or its equivalent, shall not
create a presumption that the Indemnitee acted in a manner contrary to that
specified above. Any indemnification pursuant to this Section 7.7 shall be made
only out of the assets of the Partnership, it being agreed that the General
Partner shall not be personally liable for such indemnification and shall have
no obligation to contribute or loan any monies or property to the Partnership to
enable it to effectuate such indemnification.

         (b) To the fullest extent permitted by law, expenses (including legal
fees and expenses) incurred by an Indemnitee who is indemnified pursuant to
Section 7.7(a) in defending any claim, demand, action, suit or proceeding shall,
from time to time, be advanced by the Partnership prior to the final disposition
of such claim, demand, action, suit or proceeding upon receipt by the
Partnership of any undertaking by or on behalf of the Indemnitee to repay such
amount if it shall be determined that the Indemnitee is not entitled to be
indemnified as authorized in this Section 7.7.

         (c) The indemnification provided by this Section 7.7 shall be in
addition to any other rights to which an Indemnitee may be entitled under any
agreement, pursuant to any vote of the holders of Outstanding Limited Partner
Interests, as a matter of law or otherwise, both as to actions in the
Indemnitee's capacity as an Indemnitee and as to actions in any other capacity
(including any capacity under the Underwriting Agreement), and shall continue as
to an Indemnitee who has ceased to serve in such capacity and shall inure to the
benefit of the heirs, successors, assigns and administrators of the Indemnitee.

         (d) The Partnership may purchase and maintain (or reimburse the General
Partner or its Affiliates for the cost of) insurance, on behalf of the General
Partner, its Affiliates and such other Persons as the General Partner shall
determine, against any liability that may be asserted against or expense that
may be incurred by such Person in connection with the Partnership's activities
or such Person's activities on behalf of the Partnership, regardless of whether
the Partnership would have the power to indemnify such Person against such
liability under the provisions of this Agreement.

         (e) For purposes of this Section 7.7, the Partnership shall be deemed
to have requested an Indemnitee to serve as fiduciary of an employee benefit
plan whenever the performance by it of its duties to the Partnership also
imposes duties on, or otherwise involves



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<PAGE>



services by, it to the plan or participants or beneficiaries of the plan; excise
taxes assessed on an Indemnitee with respect to an employee benefit plan
pursuant to applicable law shall constitute "fines" within the meaning of
Section 7.7(a); and action taken or omitted by it with respect to any employee
benefit plan in the performance of its duties for a purpose reasonably believed
by it to be in the interest of the participants and beneficiaries of the plan
shall be deemed to be for a purpose which is in, or not opposed to, the best
interests of the Partnership.

         (f) In no event may an Indemnitee subject the Limited Partners to
personal liability by reason of the indemnification provisions set forth in this
Agreement.

         (g) An Indemnitee shall not be denied indemnification in whole or in
part under this Section 7.7 because the Indemnitee had an interest in the
transaction with respect to which the indemnification applies if the transaction
was otherwise permitted by the terms of this Agreement.

         (h) The provisions of this Section 7.7 are for the benefit of the
Indemnitees, their heirs, successors, assigns and administrators and shall not
be deemed to create any rights for the benefit of any other Persons.

         (i) No amendment, modification or repeal of this Section 7.7 or any
provision hereof shall in any manner terminate, reduce or impair the right of
any past, present or future Indemnitee to be indemnified by the Partnership, nor
the obligations of the Partnership to indemnify any such Indemnitee under and in
accordance with the provisions of this Section 7.7 as in effect immediately
prior to such amendment, modification or repeal with respect to claims arising
from or relating to matters occurring, in whole or in part, prior to such
amendment, modification or repeal, regardless of when such claims may arise or
be asserted.

         Section 7.8 Liability of Indemnitees.

         (a) Notwithstanding anything to the contrary set forth in this
Agreement, no Indemnitee shall be liable for monetary damages to the
Partnership, the Limited Partners, the Assignees or any other Persons who have
acquired interests in the Partnership Securities, for losses sustained or
liabilities incurred as a result of any act or omission if such Indemnitee acted
in good faith.

         (b) Subject to its obligations and duties as General Partner set forth
in Section 7.1(a), the General Partner may exercise any of the powers granted to
it by this Agreement and perform any of the duties imposed upon it hereunder
either directly or by or through its agents, and the General Partner shall not
be responsible for any misconduct or negligence on the part of any such agent
appointed by the General Partner in good faith.

         (c) To the extent that, at law or in equity, an Indemnitee has duties
(including fiduciary duties) and liabilities relating thereto to the Partnership
or to the Partners, the General Partner and any other Indemnitee acting in
connection with the Partnership's business or affairs shall not be liable to the
Partnership or to any Partner for its good faith reliance on the provisions of
this Agreement. The provisions of this Agreement, to the extent that they
restrict or otherwise



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<PAGE>



modify the duties and liabilities of an Indemnitee otherwise existing at law or
in equity, are agreed by the Partners to replace such other duties and
liabilities of such Indemnitee.

         (d) Any amendment, modification or repeal of this Section 7.8 or any
provision hereof shall be prospective only and shall not in any way affect the
limitations on the liability to the Partnership, the Limited Partners, the
General Partner, and the Partnership's and General Partner's directors, officers
and employees under this Section 7.8 as in effect immediately prior to such
amendment, modification or repeal with respect to claims arising from or
relating to matters occurring, in whole or in part, prior to such amendment,
modification or repeal, regardless of when such claims may arise or be asserted.

         Section 7.9 Resolution of Conflicts of Interest.

         (a) Unless otherwise expressly provided in this Agreement, the
Operating Partnership Agreement or the limited liability company agreement or
partnership agreement of any other Group Member, whenever a potential conflict
of interest exists or arises between the General Partner or any of its
Affiliates, on the one hand, and the Partnership, the Operating Partnership, any
other Group Member, any Partner or any Assignee, on the other, any resolution or
course of action by the General Partner or its Affiliates in respect of such
conflict of interest shall be permitted and deemed approved by all Partners, and
shall not constitute a breach of this Agreement, of the Operating Partnership
Agreement, of any agreement contemplated herein or therein, or of any duty
stated or implied by law or equity, if the resolution or course of action is, or
by operation of this Agreement is deemed to be, fair and reasonable to the
Partnership. The General Partner shall be authorized but not required in
connection with its resolution of such conflict of interest to seek Special
Approval of such resolution, and the General Partner may also adopt a resolution
or course of action that has not received Special Approval. Any such approval by
the Conflicts Committee shall be subject to the presumption that, in making its
decision, the Conflicts Committee acted on an informed basis, in good faith, and
in the honest belief that the action taken was in the best interests of the
Partnership, and in any proceeding brought by any Unitholder or by or on behalf
of such Unitholder or any other Unitholders or the Partnership challenging such
approval, the Person bringing or prosecuting such proceeding shall have the
burden of overcoming such presumption. Any conflict of interest and any
resolution of such conflict of interest shall be conclusively deemed fair and
reasonable to the Partnership if such conflict of interest or resolution is (i)
approved by Special Approval, (ii) on terms no less favorable to the Partnership
than those generally being provided to or available from unrelated third parties
or (iii) fair to the Partnership, taking into account the totality of the
relationships between the parties involved (including other transactions that
may be particularly favorable or advantageous to the Partnership). The General
Partner (including the Conflicts Committee in connection with Special Approval)
shall be authorized in connection with its determination of what is "fair and
reasonable" to the Partnership and in connection with its resolution of any
conflict of interest to consider (A) the relative interests of any party to such
conflict, agreement, transaction or situation and the benefits and burdens
relating to such interest; (B) any customary or accepted industry practices and
any customary or historical dealings with a particular Person; (C) any
applicable generally accepted accounting practices or principles; and (D) such
additional factors as the General Partner (including the Conflicts Committee)
determines in its sole discretion to be relevant, reasonable or appropriate
under the circumstances. In any proceeding brought by any Unitholder by or on
behalf of such Unitholder or any other Unitholders or the



                                       68
<PAGE>



Partnership alleging that such a resolution by the General Partner (and not by
the Conflicts Committee, whose resolution shall be conclusive as provided above)
is not fair to the Partnership, such Unitholder shall have the burden of proof
of overcoming such conclusion. Nothing contained in this Agreement, however, is
intended to nor shall it be construed to require the General Partner (including
the Conflicts Committee) to consider the interests of any Person other than the
Partnership. In the absence of bad faith by the General Partner, the resolution,
action or terms so made, taken or provided by the General Partner with respect
to such matter shall not constitute a breach of this Agreement or any other
agreement contemplated herein or a breach of any standard of care or duty
imposed herein or therein or, to the extent permitted by law, under the Delaware
Act or any other law, rule or regulation.

         (b) Whenever this Agreement or any other agreement contemplated hereby
provides that the General Partner or any of its Affiliates is permitted or
required to make a decision (i) in its "sole discretion" or "discretion," that
it deems "necessary or appropriate" or "necessary or advisable" or under a grant
of similar authority or latitude, except as otherwise provided herein, the
General Partner or such Affiliate shall be entitled to consider only such
interests and factors as it desires and shall have no duty or obligation to give
any consideration to any interest of, or factors affecting, the Partnership, the
Operating Partnership, any Group Member, any Limited Partner or any Assignee,
(ii) it may make such decision in its sole discretion (regardless of whether
there is a reference to "sole discretion" or "discretion") unless another
express standard is provided for, or (iii) in "good faith" or under another
express standard, the General Partner or such Affiliate shall act under such
express standard and shall not be subject to any other or different standards
imposed by this Agreement, the Operating Partnership Agreement, the limited
liability company agreement or partnership agreement of any Group Member any
other agreement contemplated hereby or under the Delaware Act or any other law,
rule or regulation. In addition, any actions taken by the General Partner or
such Affiliate consistent with the standards of "reasonable discretion" set
forth in the definitions of Available Cash or Operating Surplus shall not
constitute a breach of any duty of the General Partner to the Partnership or the
Limited Partners. The General Partner shall have no duty, express or implied, to
sell or otherwise dispose of any asset of the Partnership Group other than in
the ordinary course of business. No borrowing by any Group Member or the
approval thereof by the General Partner shall be deemed to constitute a breach
of any duty of the General Partner to the Partnership or the Limited Partners by
reason of the fact that the purpose or effect of such borrowing is directly or
indirectly to (A) enable distributions to the General Partner or its Affiliates
(including in their capacities as Limited Partners) to exceed 2% of the total
amount distributed to all partners or (B) hasten the expiration of the
Subordination Period or the conversion of any Subordinated Units into Common
Units.

         (c) Whenever a particular transaction, arrangement or resolution of a
conflict of interest is required under this Agreement to be "fair and
reasonable" to any Person, the fair and reasonable nature of such transaction,
arrangement or resolution shall be considered in the context of all similar or
related transactions.

         (d) The Unitholders hereby authorize the General Partner, on behalf of
the Partnership as a partner or member of a Group Member, to approve of actions
by the general partner or managing member of such Group Member similar to those
actions permitted to be taken by the General Partner pursuant to this Section
7.9.



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         Section 7.10 Other Matters Concerning the General Partner.

         (a) The General Partner may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, bond, debenture or other paper
or document believed by it to be genuine and to have been signed or presented by
the proper party or parties.

         (b) The General Partner may consult with legal counsel, accountants,
appraisers, management consultants, investment bankers and other consultants and
advisers selected by it, and any act taken or omitted to be taken in reliance
upon the opinion (including an Opinion of Counsel) of such Persons as to matters
that the General Partner reasonably believes to be within such Person's
professional or expert competence shall be conclusively presumed to have been
done or omitted in good faith and in accordance with such opinion.

         (c) The General Partner shall have the right, in respect of any of its
powers or obligations hereunder, to act through any of its duly authorized
officers, a duly appointed attorney or attorneys-in-fact or the duly authorized
officers of the Partnership.

         (d) Any standard of care and duty imposed by this Agreement or under
the Delaware Act or any applicable law, rule or regulation shall be modified,
waived or limited, to the extent permitted by law, as required to permit the
General Partner to act under this Agreement or any other agreement contemplated
by this Agreement and to make any decision pursuant to the authority prescribed
in this Agreement, so long as such action is reasonably believed by the General
Partner to be in, or not inconsistent with, the best interests of the
Partnership.

         Section 7.11 Purchase or Sale of Partnership Securities. The General
Partner may cause the Partnership to purchase or otherwise acquire Partnership
Securities; provided that, except as permitted pursuant to Section 4.10, the
General Partner may not cause any Group Member to purchase Subordinated Units
during the Subordination Period. As long as Partnership Securities are held by
any Group Member, such Partnership Securities shall not be considered
Outstanding for any purpose, except as otherwise provided herein. The General
Partner or any Affiliate of the General Partner may also purchase or otherwise
acquire and sell or otherwise dispose of Partnership Securities for its own
account, subject to the provisions of Articles IV and X.

         Section 7.12 Registration Rights of the General Partner and its
Affiliates.

         (a) If (i) the General Partner or any Affiliate of the General Partner
(including for purposes of this Section 7.12, any Person that is an Affiliate of
the General Partner at the date of this Agreement notwithstanding that it may
later cease to be an Affiliate of the General Partner) holds Partnership
Securities that it desires to sell and (ii) Rule 144 of the Securities Act (or
any successor rule or regulation to Rule 144) or another exemption from
registration is not available to enable such holder of Partnership Securities
(the "Holder") to dispose of the number of Partnership Securities it desires to
sell at the time it desires to do so without registration under the Securities
Act, then upon the request of any such Holder, the Partnership shall file with
the Commission as promptly as practicable after receiving such request, and use
all reasonable efforts to cause to become effective and remain effective for a
period of not less than six months



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following its effective date or such shorter period as shall terminate when all
Partnership Securities covered by such registration statement have been sold, a
registration statement under the Securities Act registering the offering and
sale of the number of Partnership Securities specified by the Holder; provided,
however, that the Partnership shall not be required to effect more than three
registrations pursuant to this Section 7.12(a); and provided further, however,
that if the Conflicts Committee determines in its good faith judgment that a
postponement of the requested registration for up to six months would be in the
best interests of the Partnership and its Partners due to a pending transaction,
investigation or other event, the filing of such registration statement or the
effectiveness thereof may be deferred for up to six months, but not thereafter.
In connection with any registration pursuant to the immediately preceding
sentence, the Partnership shall promptly prepare and file (x) such documents as
may be necessary to register or qualify the securities subject to such
registration under the securities laws of such states as the Holder shall
reasonably request; provided, however, that no such qualification shall be
required in any jurisdiction where, as a result thereof, the Partnership would
become subject to general service of process or to taxation or qualification to
do business as a foreign corporation or partnership doing business in such
jurisdiction solely as a result of such registration, and (y) such documents as
may be necessary to apply for listing or to list the Partnership Securities
subject to such registration on such National Securities Exchange as the Holder
shall reasonably request, and do any and all other acts and things that may
reasonably be necessary or advisable to enable the Holder to consummate a public
sale of such Partnership Securities in such states. Except as set forth in
Section 7.12(c), all costs and expenses of any such registration and offering
(other than the underwriting discounts and commissions) shall be paid by the
Partnership, without reimbursement by the Holder.

         (b) If the Partnership shall at any time propose to file a registration
statement under the Securities Act for an offering of equity securities of the
Partnership for cash (other than an offering relating solely to an employee
benefit plan), the Partnership shall use all reasonable efforts to include such
number or amount of securities held by the Holder in such registration statement
as the Holder shall request. If the proposed offering pursuant to this Section
7.12(b) shall be an underwritten offering, then, in the event that the managing
underwriter or managing underwriters of such offering advise the Partnership and
the Holder in writing that in their opinion the inclusion of all or some of the
Holder's Partnership Securities would adversely and materially affect the
success of the offering, the Partnership shall include in such offering only
that number or amount, if any, of securities held by the Holder which, in the
opinion of the managing underwriter or managing underwriters, will not so
adversely and materially affect the offering. Except as set forth in Section
7.12(c), all costs and expenses of any such registration and offering (other
than the underwriting discounts and commissions) shall be paid by the
Partnership, without reimbursement by the Holder.

         (c) If underwriters are engaged in connection with any registration
referred to in this Section 7.12, the Partnership shall provide indemnification,
representations, covenants, opinions and other assurance to the underwriters in
form and substance reasonably satisfactory to such underwriters. Further, in
addition to and not in limitation of the Partnership's obligation under Section
7.7, the Partnership shall, to the fullest extent permitted by law, indemnify
and hold harmless the Holder, its officers, directors and each Person who
controls the Holder (within the meaning of the Securities Act) and any agent
thereof (collectively, "Indemnified Persons") against any losses, claims,
demands, actions, causes of action, assessments, damages, liabilities



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(joint or several), costs and expenses (including interest, penalties and
reasonable attorneys' fees and disbursements), resulting to, imposed upon, or
incurred by the Indemnified Persons, directly or indirectly, under the
Securities Act or otherwise (hereinafter referred to in this Section 7.12(c) as
a "claim" and in the plural as "claims") based upon, arising out of or resulting
from any untrue statement or alleged untrue statement of any material fact
contained in any registration statement under which any Partnership Securities
were registered under the Securities Act or any state securities or Blue Sky
laws, in any preliminary prospectus (if used prior to the effective date of such
registration statement), or in any summary or final prospectus or in any
amendment or supplement thereto (if used during the period the Partnership is
required to keep the registration statement current), or arising out of, based
upon or resulting from the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
made therein not misleading; provided, however, that the Partnership shall not
be liable to any Indemnified Person to the extent that any such claim arises out
of, is based upon or results from an untrue statement or alleged untrue
statement or omission or alleged omission made in such registration statement,
such preliminary, summary or final prospectus or such amendment or supplement,
in reliance upon and in conformity with written information furnished to the
Partnership by or on behalf of such Indemnified Person specifically for use in
the preparation thereof.

         (d) The provisions of Section 7.12(a) and 7.12(b) shall continue to be
applicable with respect to the General Partner (and any of the General Partner's
Affiliates) after it ceases to be a Partner of the Partnership, during a period
of two years subsequent to the effective date of such cessation and for so long
thereafter as is required for the Holder to sell all of the Partnership
Securities with respect to which, during such two-year period, it has requested
inclusion in a registration statement pursuant to Section 7.12(b) or requested
that a registration statement be filed pursuant to Section 7.12(a); provided,
however, that the Partnership shall not be required to file successive
registration statements covering the same Partnership Securities for which
registration was demanded during such two-year period. The provisions of Section
7.12(c) shall continue in effect thereafter.

         (e) Any request to register Partnership Securities pursuant to this
Section 7.12 shall (i) specify the Partnership Securities intended to be offered
and sold by the Person making the request, (ii) express such Person's present
intent to offer such Partnership Securities for distribution, (iii) describe the
nature or method of the proposed offer and sale of Partnership Securities, and
(iv) contain the undertaking of such Person to provide all such information and
materials and take all action as may be required in order to permit the
Partnership to comply with all applicable requirements in connection with the
registration of such Partnership Securities.

         Section 7.13 Reliance by Third Parties. Notwithstanding anything to the
contrary in this Agreement, any Person dealing with the Partnership shall be
entitled to assume that the General Partner and any officer of the General
Partner authorized by the General Partner to act on behalf of and in the name of
the Partnership has full power and authority to encumber, sell or otherwise use
in any manner any and all assets of the Partnership and to enter into any
authorized contracts on behalf of the Partnership, and such Person shall be
entitled to deal with the General Partner or any such officer as if it were the
Partnership's sole party in interest, both legally and beneficially. Each
Limited Partner hereby waives any and all defenses or other remedies that may be
available against such Person to contest, negate or disaffirm any action of the
General



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Partner or any such officer in connection with any such dealing. In no event
shall any Person dealing with the General Partner or any such officer or its
representatives be obligated to ascertain that the terms of the Agreement have
been complied with or to inquire into the necessity or expedience of any act or
action of the General Partner or any such officer or its representatives. Each
and every certificate, document or other instrument executed on behalf of the
Partnership by the General Partner or its representatives shall be conclusive
evidence in favor of any and every Person relying thereon or claiming thereunder
that (a) at the time of the execution and delivery of such certificate, document
or instrument, this Agreement was in full force and effect, (b) the Person
executing and delivering such certificate, document or instrument was duly
authorized and empowered to do so for and on behalf of the Partnership and (c)
such certificate, document or instrument was duly executed and delivered in
accordance with the terms and provisions of this Agreement and is binding upon
the Partnership.

                                  ARTICLE VIII
                     BOOKS, RECORDS, ACCOUNTING AND REPORTS

         Section 8.1 Records and Accounting. The General Partner shall keep or
cause to be kept at the principal office of the Partnership appropriate books
and records with respect to the Partnership's business, including all books and
records necessary to provide to the Limited Partners any information required to
be provided pursuant to Section 3.4(a). Any books and records maintained by or
on behalf of the Partnership in the regular course of its business, including
the record of the Record Holders and Assignees of Units or other Partnership
Securities, books of account and records of Partnership proceedings, may be kept
on, or be in the form of, computer disks, hard drives, punch cards, magnetic
tape, photographs, micrographics or any other information storage device;
provided, that the books and records so maintained are convertible into clearly
legible written form within a reasonable period of time. The books of the
Partnership shall be maintained, for financial reporting purposes, on an accrual
basis in accordance with U.S. GAAP.

         Section 8.2 Fiscal Year. The fiscal year of the Partnership shall be a
fiscal year ending December 31.

         Section 8.3 Reports.

         (a) As soon as practicable, but in no event later than 120 days after
the close of each fiscal year of the Partnership, the General Partner shall
cause to be mailed or made available to each Record Holder of a Unit as of a
date selected by the General Partner in its discretion, an annual report
containing financial statements of the Partnership for such fiscal year of the
Partnership, presented in accordance with U.S. GAAP, including a balance sheet
and statements of operations, Partnership equity and cash flows, such statements
to be audited by a firm of independent public accountants selected by the
General Partner.

         (b) As soon as practicable, but in no event later than 90 days after
the close of each Quarter except the last Quarter of each fiscal year, the
General Partner shall cause to be mailed or made available to each Record Holder
of a Unit, as of a date selected by the General Partner in its discretion, a
report containing unaudited financial statements of the Partnership and such
other information as may be required by applicable law, regulation or rule of
any National



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Securities Exchange on which the Units are listed for trading, or as the General
Partner determines to be necessary or appropriate.

                                   ARTICLE IX
                                   TAX MATTERS

         Section 9.1 Tax Returns and Information. The Partnership shall timely
file all returns of the Partnership that are required for federal, state and
local income tax purposes on the basis of the accrual method and a taxable year
ending on December 31. The tax information reasonably required by Record Holders
for federal and state income tax reporting purposes with respect to a taxable
year shall be furnished to them within 90 days of the close of the calendar year
in which the Partnership's taxable year ends. The classification, realization
and recognition of income, gain, losses and deductions and other items shall be
on the accrual method of accounting for federal income tax purposes.

         Section 9.2 Tax Elections.

         (a) The Partnership shall make the election under Section 754 of the
Code in accordance with applicable regulations thereunder, subject to the
reservation of the right to seek to revoke any such election upon the General
Partner's determination that such revocation is in the best interests of the
Limited Partners. Notwithstanding any other provision herein contained, for the
purposes of computing the adjustments under Section 743(b) of the Code, the
General Partner shall be authorized (but not required) to adopt a convention
whereby the price paid by a transferee of a Limited Partner Interest will be
deemed to be the lowest quoted closing price of the Limited Partner Interests on
any National Securities Exchange on which such Limited Partner Interests are
traded during the calendar month in which such transfer is deemed to occur
pursuant to Section 6.2(g) without regard to the actual price paid by such
transferee.

         (b) The Partnership shall elect to deduct expenses incurred in
organizing the Partnership ratably over a sixty-month period as provided in
Section 709 of the Code.

         (c) Except as otherwise provided herein, the General Partner shall
determine whether the Partnership should make any other elections permitted by
the Code.

         Section 9.3 Tax Controversies. Subject to the provisions hereof, the
General Partner is designated as the Tax Matters Partner (as defined in the
Code) and is authorized and required to represent the Partnership (at the
Partnership's expense) in connection with all examinations of the Partnership's
affairs by tax authorities, including resulting administrative and judicial
proceedings, and to expend Partnership funds for professional services and costs
associated therewith. Each Partner agrees to cooperate with the General Partner
and to do or refrain from doing any or all things reasonably required by the
General Partner to conduct such proceedings.

         Section 9.4 Withholding. Notwithstanding any other provision of this
Agreement, the General Partner is authorized to take any action that it
determines in its discretion to be necessary or appropriate to cause the
Partnership and other Group Members to comply with any withholding requirements
established under the Code or any other federal, state or local law including,
without limitation, pursuant to Sections 1441, 1442, 1445 and 1446 of the Code.
To



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the extent that the Partnership is required or elects to withhold and pay over
to any taxing authority any amount resulting from the allocation or distribution
of income to any Partner or Assignee (including, without limitation, by reason
of Section 1446 of the Code), the amount withheld may at the discretion of the
General Partner be treated by the Partnership as a distribution of cash pursuant
to Section 6.3 in the amount of such withholding from such Partner.

                                    ARTICLE X
                              ADMISSION OF PARTNERS

         Section 10.1 Admission of Initial Limited Partners. Upon the issuance
by the Partnership of Common Units, Subordinated Units and Incentive
Distribution Rights to the Partners as described in Section 5.3 in connection
with the Initial Offering, the General Partner shall admit such parties to the
Partnership as Initial Limited Partners in respect of the Common Units,
Subordinated Units or Incentive Distribution Rights issued to them.

         Section 10.2 Admission of Substituted Limited Partner. By transfer of a
Limited Partner Interest in accordance with Article IV, the transferor shall be
deemed to have given the transferee the right to seek admission as a Substituted
Limited Partner subject to the conditions of, and in the manner permitted under,
this Agreement. A transferor of a Certificate representing a Limited Partner
Interest shall, however, only have the authority to convey to a purchaser or
other transferee who does not execute and deliver a Transfer Application (a) the
right to negotiate such Certificate to a purchaser or other transferee and (b)
the right to transfer the right to request admission as a Substituted Limited
Partner to such purchaser or other transferee in respect of the transferred
Limited Partner Interests. Each transferee of a Limited Partner Interest
(including any nominee holder or an agent acquiring such Limited Partner
Interest for the account of another Person) who executes and delivers a Transfer
Application shall, by virtue of such execution and delivery, be an Assignee and
be deemed to have applied to become a Substituted Limited Partner with respect
to the Limited Partner Interests so transferred to such Person. Such Assignee
shall become a Substituted Limited Partner (x) at such time as the General
Partner consents thereto, which consent may be given or withheld in the General
Partner's discretion, and (y) when any such admission is shown on the books and
records of the Partnership. If such consent is withheld, such transferee shall
be an Assignee. An Assignee shall have an interest in the Partnership equivalent
to that of a Limited Partner with respect to allocations and distributions,
including liquidating distributions, of the Partnership. With respect to voting
rights attributable to Limited Partner Interests that are held by Assignees, the
General Partner shall be deemed to be the Limited Partner with respect thereto
and shall, in exercising the voting rights in respect of such Limited Partner
Interests on any matter, vote such Limited Partner Interests at the written
direction of the Assignee who is the Record Holder of such Limited Partner
Interests. If no such written direction is received, such Limited Partner
Interests will not be voted. An Assignee shall have no other rights of a Limited
Partner.

         Section 10.3 Admission of Successor General Partner. A successor
General Partner approved pursuant to Section 11.1 or 11.2 or the transferee of
or successor to all of the General Partner Interest pursuant to Section 4.6 who
is proposed to be admitted as a successor General Partner shall be admitted to
the Partnership as the General Partner, effective immediately prior to the
withdrawal or removal of the predecessor or transferring General Partner,
pursuant to Section 11.1 or 11.2 or the transfer of the General Partner Interest
pursuant to Section 4.6; provided,



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however, that no such successor shall be admitted to the Partnership until
compliance with the terms of Section 4.6 has occurred and such successor has
executed and delivered such other documents or instruments as may be required to
effect such admission. Any such successor shall, subject to the terms hereof,
carry on the business of the members of the Partnership Group without
dissolution.

         Section 10.4 Admission of Additional Limited Partners.

         (a) A Person (other than the General Partner, an Initial Limited
Partner or a Substituted Limited Partner) who makes a Capital Contribution to
the Partnership in accordance with this Agreement shall be admitted to the
Partnership as an Additional Limited Partner only upon furnishing to the General
Partner

                  (i) evidence of acceptance in form satisfactory to the General
         Partner of all of the terms and conditions of this Agreement, including
         the power of attorney granted in Section 2.6, and

                  (ii) such other documents or instruments as may be required in
         the discretion of the General Partner to effect such Person's admission
         as an Additional Limited Partner.

         (b) Notwithstanding anything to the contrary in this Section 10.4, no
Person shall be admitted as an Additional Limited Partner without the consent of
the General Partner, which consent may be given or withheld in the General
Partner's discretion. The admission of any Person as an Additional Limited
Partner shall become effective on the date upon which the name of such Person is
recorded as such in the books and records of the Partnership, following the
consent of the General Partner to such admission.

         Section 10.5 Amendment of Agreement and Certificate of Limited
Partnership. To effect the admission to the Partnership of any Partner, the
General Partner shall take all steps necessary and appropriate under the
Delaware Act to amend the records of the Partnership to reflect such admission
and, if necessary, to prepare as soon as practicable an amendment to this
Agreement and, if required by law, the General Partner shall prepare and file an
amendment to the Certificate of Limited Partnership, and the General Partner may
for this purpose, among others, exercise the power of attorney granted pursuant
to Section 2.6.

                                   ARTICLE XI
                        WITHDRAWAL OR REMOVAL OF PARTNERS

         Section 11.1 Withdrawal of the General Partner.

         (a) The General Partner shall be deemed to have withdrawn from the
Partnership upon the occurrence of any one of the following events (each such
event herein referred to as an "Event of Withdrawal");

                  (i) The General Partner voluntarily withdraws from the
         Partnership by giving written notice to the other Partners;



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                  (ii) The General Partner transfers all of its rights as
         General Partner pursuant to Section 4.6;

                  (iii) The General Partner is removed pursuant to Section 11.2;

                  (iv) The General Partner (A) makes a general assignment for
         the benefit of creditors; (B) files a voluntary bankruptcy petition for
         relief under Chapter 7 of the United States Bankruptcy Code; (C) files
         a petition or answer seeking for itself a liquidation, dissolution or
         similar relief (but not a reorganization) under any law; (D) files an
         answer or other pleading admitting or failing to contest the material
         allegations of a petition filed against the General Partner in a
         proceeding of the type described in clauses (A)-(C) of this Section
         11.1(a)(iv); or (E) seeks, consents to or acquiesces in the appointment
         of a trustee (but not a debtor-in-possession), receiver or liquidator
         of the General Partner or of all or any substantial part of its
         properties;

                  (v) A final and non-appealable order of relief under Chapter 7
         of the United States Bankruptcy Code is entered by a court with
         appropriate jurisdiction pursuant to a voluntary or involuntary
         petition by or against the General Partner; or

                  (vi) (A) in the event the General Partner is a corporation, a
         certificate of dissolution or its equivalent is filed for the General
         Partner, or 90 days expire after the date of notice to the General
         Partner of revocation of its charter without a reinstatement of its
         charter, under the laws of its state of incorporation; (B) in the event
         the General Partner is a partnership or a limited liability company,
         the dissolution and commencement of winding up of the General Partner;
         (C) in the event the General Partner is acting in such capacity by
         virtue of being a trustee of a trust, the termination of the trust; (D)
         in the event the General Partner is a natural person, his death or
         adjudication of incompetency; and (E) otherwise in the event of the
         termination of the General Partner.

If an Event of Withdrawal specified in Section 11.1(a)(iv), (v) or (vi)(A), (B),
(C) or (E) occurs, the withdrawing General Partner shall give notice to the
Limited Partners within 30 days after such occurrence. The Partners hereby agree
that only the Events of Withdrawal described in this Section 11.1 shall result
in the withdrawal of the General Partner from the Partnership.

         (b) Withdrawal of the General Partner from the Partnership upon the
occurrence of an Event of Withdrawal shall not constitute a breach of this
Agreement under the following circumstances: (i) at any time during the period
beginning on the Closing Date and ending at 12:00 midnight, Eastern Standard
Time, on September 30, 2012, the General Partner voluntarily withdraws by giving
at least 90 days' advance notice of its intention to withdraw to the Limited
Partners; provided that prior to the effective date of such withdrawal, the
withdrawal is approved by Unitholders holding at least a majority of the
Outstanding Common Units (excluding Common Units held by the General Partner and
its Affiliates) and the General Partner delivers to the Partnership an Opinion
of Counsel ("Withdrawal Opinion of Counsel") that such withdrawal (following the
selection of the successor General Partner) would not result in the loss of the
limited liability of any Limited Partner or any Group Member or cause any Group
Member to be treated as an association taxable as a corporation or otherwise to
be taxed as an entity for federal



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income tax purposes (to the extent not previously treated as such); (ii) at any
time after 12:00 midnight, Eastern Standard Time, on September 30, 2012, the
General Partner voluntarily withdraws by giving at least 90 days' advance notice
to the Unitholders, such withdrawal to take effect on the date specified in such
notice; (iii) at any time that the General Partner ceases to be the General
Partner pursuant to Section 11.1(a)(ii) or is removed pursuant to Section 11.2;
or (iv) notwithstanding clause (i) of this sentence, at any time that the
General Partner voluntarily withdraws by giving at least 90 days' advance notice
of its intention to withdraw to the Limited Partners, such withdrawal to take
effect on the date specified in the notice, if at the time such notice is given
one Person and its Affiliates (other than the General Partner and its
Affiliates) own beneficially or of record or control at least 50% of the
Outstanding Units. The withdrawal of the General Partner from the Partnership
upon the occurrence of an Event of Withdrawal shall also constitute the
withdrawal of the General Partner as general partner or managing member, to the
extent applicable, of the other Group Members. If the General Partner gives a
notice of withdrawal pursuant to Section 11.1(a)(i), the holders of a Unit
Majority, may, prior to the effective date of such withdrawal, elect a successor
General Partner. The Person so elected as successor General Partner shall
automatically become the successor general partner or managing member, to the
extent applicable, of the other Group Members of which the General Partner is a
general partner or a managing member. If, prior to the effective date of the
General Partner's withdrawal, a successor is not selected by the Unitholders as
provided herein or the Partnership does not receive a Withdrawal Opinion of
Counsel, the Partnership shall be dissolved in accordance with Section 12.1. Any
successor General Partner elected in accordance with the terms of this Section
11.1 shall be subject to the provisions of Section 10.3.

         Section 11.2 Removal of the General Partner. The General Partner may be
removed if such removal is approved by the Unitholders holding at least 66 2/3%
of the Outstanding Units (including Units held by the General Partner and its
Affiliates). Any such action by such holders for removal of the General Partner
must also provide for the election of a successor General Partner by the
Unitholders holding a majority of the outstanding Common Units voting as a class
and a majority of the outstanding Subordinated Units voting as a class
(including Units held by the General Partner and its Affiliates). Such removal
shall be effective immediately following the admission of a successor General
Partner pursuant to Section 10.3. The removal of the General Partner shall also
automatically constitute the removal of the General Partner as general partner
or managing member, to the extent applicable, of the other Group Members of
which the General Partner is a general partner or a managing member. If a Person
is elected as a successor General Partner in accordance with the terms of this
Section 11.2, such Person shall, upon admission pursuant to Section 10.3,
automatically become a successor general partner or managing member, to the
extent applicable, of the other Group Members of which the General Partner is a
general partner or a managing member. The right of the holders of Outstanding
Units to remove the General Partner shall not exist or be exercised unless the
Partnership has received an opinion opining as to the matters covered by a
Withdrawal Opinion of Counsel. Any successor General Partner elected in
accordance with the terms of this Section 11.2 shall be subject to the
provisions of Section 10.3. The percentage of the Outstanding Units required to
remove the General Partner may be amended by the General Partner as described in
Section 13.1 hereof.



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         Section 11.3 Interest of Departing Partner and Successor General
Partner.

         (a) In the event of (i) withdrawal of the General Partner under
circumstances where such withdrawal does not violate this Agreement or (ii)
removal of the General Partner by the holders of Outstanding Units under
circumstances where Cause does not exist, if the successor General Partner is
elected in accordance with the terms of Section 11.1 or 11.2, the Departing
Partner shall have the option, exercisable prior to the effective date of the
departure of such Departing Partner, to require its successor to purchase its
General Partner Interest and its general partner interest (or equivalent
interest, if any) in the other Group Members and all of its Incentive
Distribution Rights (collectively, the "Combined Interest") in exchange for an
amount in cash equal to the fair market value of such Combined Interest, such
amount to be determined and payable as of the effective date of its departure.
If the General Partner is removed by the Unitholders under circumstances where
Cause exists or if the General Partner withdraws under circumstances where such
withdrawal violates this Agreement, and if a successor General Partner is
elected in accordance with the terms of Section 11.1 or 11.2, such successor
shall have the option, exercisable prior to the effective date of the departure
of such Departing Partner, to purchase the Combined Interest for such fair
market value of such Combined Interest of the Departing Partner. In either
event, the Departing Partner shall be entitled to receive all reimbursements due
such Departing Partner pursuant to Section 7.4, including any employee-related
liabilities (including severance liabilities), incurred in connection with the
termination of any employees employed by the Departing Partner for the benefit
of the Partnership or the other Group Members.

         For purposes of this Section 11.3(a), the fair market value of the
Departing Partner's Combined Interest shall be determined by agreement between
the Departing Partner and its successor or, failing agreement within 30 days
after the effective date of such Departing Partner's departure, by an
independent investment banking firm or other independent expert selected by the
Departing Partner and its successor, which, in turn, may rely on other experts,
and the determination of which shall be conclusive as to such matter. If such
parties cannot agree upon one independent investment banking firm or other
independent expert within 45 days after the effective date of such departure,
then the Departing Partner shall designate an independent investment banking
firm or other independent expert, the Departing Partner's successor shall
designate an independent investment banking firm or other independent expert,
and such firms or experts shall mutually select a third independent investment
banking firm or independent expert, which third independent investment banking
firm or other independent expert shall determine the fair market value of the
Combined Interest of the Departing Partner. In making its determination, such
third independent investment banking firm or other independent expert may
consider the then current trading price of Units on any National Securities
Exchange on which Units are then listed, the value of the Partnership's assets,
the rights and obligations of the Departing Partner and other factors it may
deem relevant.

         (b) If the Combined Interest is not purchased in the manner set forth
in Section 11.3(a), the Departing Partner (or its transferee) shall become a
Limited Partner and its Combined Interest shall be converted into Common Units
pursuant to a valuation made by an investment banking firm or other independent
expert selected pursuant to Section 11.3(a), without reduction in such
Partnership Interest (but subject to proportionate dilution by reason of the
admission of its successor). Any successor General Partner shall indemnify the
Departing



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Partner (or its transferee) as to all debts and liabilities of the Partnership
arising on or after the date on which the Departing Partner (or its transferee)
becomes a Limited Partner. For purposes of this Agreement, conversion of the
Combined Interest of the Departing Partner to Common Units will be characterized
as if the Departing Partner (or its transferee) contributed its Combined
Interest to the Partnership in exchange for the newly issued Common Units.

         (c) If a successor General Partner is elected in accordance with the
terms of Section 11.1 or 11.2 and the option described in Section 11.3(a) is not
exercised by the party entitled to do so, the successor General Partner shall,
at the effective date of its admission to the Partnership, contribute to the
Partnership cash in the amount equal to 2/98ths of the Net Agreed Value of the
Partnership's assets on such date. In such event, such successor General Partner
shall, subject to the following sentence, be entitled to 2% of all Partnership
allocations and distributions to which the Departing Partner was entitled. In
addition, the successor General Partner shall cause this Agreement to be amended
to reflect that, from and after the date of such successor General Partner's
admission, the successor General Partner's interest in all Partnership
distributions and allocations shall be 2%.

         Section 11.4 Termination of Subordination Period, Conversion of
Subordinated Units and Extinguishment of Cumulative Common Unit Arrearages.
Notwithstanding any provision of this Agreement, if the General Partner is
removed as general partner of the Partnership under circumstances where Cause
does not exist and Units held by the General Partner and its Affiliates are not
voted in favor of such removal, (i) the Subordination Period will end and all
Outstanding Subordinated Units will immediately and automatically convert into
Common Units on a one-for-one basis and (ii) all Cumulative Common Unit
Arrearages on the Common Units will be extinguished.

         Section 11.5 Withdrawal of Limited Partners. No Limited Partner shall
have any right to withdraw from the Partnership; provided, however, that when a
transferee of a Limited Partner's Limited Partner Interest becomes a Record
Holder of the Limited Partner Interest so transferred, such transferring Limited
Partner shall cease to be a Limited Partner with respect to the Limited Partner
Interest so transferred.

                                   ARTICLE XII
                           DISSOLUTION AND LIQUIDATION

         Section 12.1 Dissolution. The Partnership shall not be dissolved by the
admission of Substituted Limited Partners or Additional Limited Partners or by
the admission of a successor General Partner in accordance with the terms of
this Agreement. Upon the removal or withdrawal of the General Partner, if a
successor General Partner is elected pursuant to Section 11.1 or 11.2, the
Partnership shall not be dissolved and such successor General Partner shall
continue the business of the Partnership. The Partnership shall dissolve, and
(subject to Section 12.2) its affairs shall be wound up, upon:

         (a) an Event of Withdrawal of the General Partner as provided in
Section 11.1(a) (other than Section 11.1(a)(ii)), unless a successor is elected
and an Opinion of Counsel is received as provided in Section 11.1(b) or 11.2 and
such successor is admitted to the Partnership pursuant to Section 10.3;



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         (b) an election to dissolve the Partnership by the General Partner that
is approved by the holders of a Unit Majority;

         (c) the entry of a decree of judicial dissolution of the Partnership
pursuant to the provisions of the Delaware Act; or

         (d) the sale of all or substantially all of the assets and properties
of the Partnership Group.

         Section 12.2 Continuation of the Business of the Partnership After
Dissolution. Upon (a) dissolution of the Partnership following an Event of
Withdrawal caused by the withdrawal or removal of the General Partner as
provided in Section 11.1(a)(i) or (iii) and the failure of the Partners to
select a successor to such Departing Partner pursuant to Section 11.1 or 11.2,
then within 90 days thereafter, or (b) dissolution of the Partnership upon an
event constituting an Event of Withdrawal as defined in Section 11.1(a)(iv), (v)
or (vi), then, to the maximum extent permitted by law, within 180 days
thereafter, the holders of a Unit Majority may elect to reconstitute the
Partnership and continue its business on the same terms and conditions set forth
in this Agreement by forming a new limited partnership on terms identical to
those set forth in this Agreement and having as the successor General Partner a
Person approved by the holders of a Unit Majority. Unless such an election is
made within the applicable time period as set forth above, the Partnership shall
conduct only activities necessary to wind up its affairs. If such an election is
so made, then:

                  (i) the reconstituted Partnership shall continue unless
         earlier dissolved in accordance with this Article XII;

                  (ii) if the successor General Partner is not the former
         General Partner, then the interest of the former General Partner shall
         be treated in the manner provided in Section 11.3; and

                  (iii) all necessary steps shall be taken to cancel this
         Agreement and the Certificate of Limited Partnership and to enter into
         and, as necessary, to file a new partnership agreement and certificate
         of limited partnership, and the successor General Partner may for this
         purpose exercise the powers of attorney granted the General Partner
         pursuant to Section 2.6; provided, that the right of the holders of a
         Unit Majority to approve a successor General Partner and to
         reconstitute and to continue the business of the Partnership shall not
         exist and may not be exercised unless the Partnership has received an
         Opinion of Counsel that (x) the exercise of the right would not result
         in the loss of limited liability of any Limited Partner and (y) neither
         the Partnership, the reconstituted limited partnership nor the
         Operating Partnership or any other Group Member would be treated as an
         association taxable as a corporation or otherwise be taxable as an
         entity for federal income tax purposes upon the exercise of such right
         to continue.

         Section 12.3 Liquidator. Upon dissolution of the Partnership, unless
the Partnership is continued under an election to reconstitute and continue the
Partnership pursuant to Section 12.2, the General Partner shall select one or
more Persons to act as Liquidator, which may be the



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General Partner. The Liquidator (if other than the General Partner) shall be
entitled to receive such compensation for its services as may be approved by
holders of at least a majority of the Outstanding Common Units and Subordinated
Units voting as a single class. The Liquidator (if other than the General
Partner) shall agree not to resign at any time without 15 days' prior notice and
may be removed at any time, with or without cause, by notice of removal approved
by holders of at least a majority of the Outstanding Common Units and
Subordinated Units voting as a single class. Upon dissolution, removal or
resignation of the Liquidator, a successor and substitute Liquidator (who shall
have and succeed to all rights, powers and duties of the original Liquidator)
shall within 30 days thereafter be approved by holders of at least a majority of
the Outstanding Common Units and Subordinated Units voting as a single class.
The right to approve a successor or substitute Liquidator in the manner provided
herein shall be deemed to refer also to any such successor or substitute
Liquidator approved in the manner herein provided. Except as expressly provided
in this Article XII, the Liquidator approved in the manner provided herein shall
have and may exercise, without further authorization or consent of any of the
parties hereto, all of the powers conferred upon the General Partner under the
terms of this Agreement (but subject to all of the applicable limitations,
contractual and otherwise, upon the exercise of such powers, other than the
limitation on sale set forth in Section 7.3(b)) to the extent necessary or
desirable in the good faith judgment of the Liquidator to carry out the duties
and functions of the Liquidator hereunder for and during such period of time as
shall be reasonably required in the good faith judgment of the Liquidator to
complete the winding up and liquidation of the Partnership as provided for
herein.

         Section 12.4 Liquidation. The Liquidator shall proceed to dispose of
the assets of the Partnership, discharge its liabilities, and otherwise wind up
its affairs in such manner and over such period as the Liquidator determines to
be in the best interest of the Partners, subject to Section 17-804 of the
Delaware Act and the following:

         (a) The assets may be disposed of by public or private sale or by
distribution in kind to one or more Partners on such terms as the Liquidator and
such Partner or Partners may agree. If any property is distributed in kind, the
Partner receiving the property shall be deemed for purposes of Section 12.4(c)
to have received cash equal to its fair market value; and contemporaneously
therewith, appropriate cash distributions must be made to the other Partners.
The Liquidator may, in its absolute discretion, defer liquidation or
distribution of the Partnership's assets for a reasonable time if it determines
that an immediate sale or distribution of all or some of the Partnership's
assets would be impractical or would cause undue loss to the Partners. The
Liquidator may, in its absolute discretion, distribute the Partnership's assets,
in whole or in part, in kind if it determines that a sale would be impractical
or would cause undue loss to the Partners.

         (b) Liabilities of the Partnership include amounts owed to the
Liquidator as compensation for serving in such capacity (subject to the terms of
Section 12.3) and amounts to Partners otherwise than in respect of their
distribution rights under Article VI. With respect to any liability that is
contingent, conditional or unmatured or is otherwise not yet due and payable,
the Liquidator shall either settle such claim for such amount as it thinks
appropriate or establish a reserve of cash or other assets to provide for its
payment. When paid, any unused portion of the reserve shall be distributed as
additional liquidation proceeds.



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         (c) All property and all cash in excess of that required to discharge
liabilities as provided in Section 12.4(b) shall be distributed to the Partners
in accordance with, and to the extent of, the positive balances in their
respective Capital Accounts, as determined after taking into account all Capital
Account adjustments (other than those made by reason of distributions pursuant
to this Section 12.4(c)) for the taxable year of the Partnership during which
the liquidation of the Partnership occurs (with such date of occurrence being
determined pursuant to Treasury Regulation Section 1.704-1(b)(2)(ii)(g)), and
such distribution shall be made by the end of such taxable year (or, if later,
within 90 days after said date of such occurrence).

         Section 12.5 Cancellation of Certificate of Limited Partnership. Upon
the completion of the distribution of Partnership cash and property as provided
in Section 12.4 in connection with the liquidation of the Partnership, the
Partnership shall be terminated and the Certificate of Limited Partnership and
all qualifications of the Partnership as a foreign limited partnership in
jurisdictions other than the State of Delaware shall be canceled and such other
actions as may be necessary to terminate the Partnership shall be taken.

         Section 12.6 Return of Contributions. The General Partner shall not be
personally liable for, and shall have no obligation to contribute or loan any
monies or property to the Partnership to enable it to effectuate, the return of
the Capital Contributions of the Limited Partners or Unitholders, or any portion
thereof, it being expressly understood that any such return shall be made solely
from Partnership assets.

         Section 12.7 Waiver of Partition. To the maximum extent permitted by
law, each Partner hereby waives any right to partition of the Partnership
property.

         Section 12.8 Capital Account Restoration. No Limited Partner shall have
any obligation to restore any negative balance in its Capital Account upon
liquidation of the Partnership. The General Partner shall be obligated to
restore any negative balance in its Capital Account upon liquidation of its
interest in the Partnership by the end of the taxable year of the Partnership
during which such liquidation occurs, or, if later, within 90 days after the
date of such liquidation.

                                  ARTICLE XIII
            AMENDMENT OF PARTNERSHIP AGREEMENT; MEETINGS; RECORD DATE

         Section 13.1 Amendment to be Adopted Solely by the General Partner.
Each Partner agrees that the General Partner, without the approval of any
Partner or Assignee, may amend any provision of this Agreement and execute,
swear to, acknowledge, deliver, file and record whatever documents may be
required in connection therewith, to reflect:

         (a) a change in the name of the Partnership, the location of the
principal place of business of the Partnership, the registered agent of the
Partnership or the registered office of the Partnership;

         (b) admission, substitution, withdrawal or removal of Partners in
accordance with this Agreement;



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         (c) a change that, in the sole discretion of the General Partner, is
necessary or advisable to qualify or continue the qualification of the
Partnership as a limited partnership or a partnership in which the Limited
Partners have limited liability under the laws of any state or to ensure that
the Group Members will not be treated as associations taxable as corporations or
otherwise taxed as entities for federal income tax purposes;

         (d) a change that, in the discretion of the General Partner, (i) does
not adversely affect the Limited Partners (including any particular class of
Partnership Interests as compared to other classes of Partnership Interests) in
any material respect, (ii) is necessary or advisable to (A) satisfy any
requirements, conditions or guidelines contained in any opinion, directive,
order, ruling or regulation of any federal or state agency or judicial authority
or contained in any federal or state statute (including the Delaware Act) or (B)
facilitate the trading of the Units (including the division of any class or
classes of Outstanding Units into different classes to facilitate uniformity of
tax consequences within such classes of Units) or comply with any rule,
regulation, guideline or requirement of any National Securities Exchange on
which the Units are or will be listed for trading, compliance with any of which
the General Partner determines in its discretion to be in the best interests of
the Partnership and the Limited Partners, (iii) is necessary or advisable in
connection with action taken by the General Partner pursuant to Section 5.10 or
(iv) is required to effect the intent expressed in the Registration Statement or
the intent of the provisions of this Agreement or is otherwise contemplated by
this Agreement;

         (e) a change in the fiscal year or taxable year of the Partnership and
any changes that, in the discretion of the General Partner, are necessary or
advisable as a result of a change in the fiscal year or taxable year of the
Partnership including, if the General Partner shall so determine, a change in
the definition of "Quarter" and the dates on which distributions are to be made
by the Partnership;

         (f) an amendment that is necessary, in the Opinion of Counsel, to
prevent the Partnership, or the General Partner or its directors, officers,
trustees or agents from in any manner being subjected to the provisions of the
Investment Company Act of 1940, as amended, the Investment Advisers Act of 1940,
as amended, or "plan asset" regulations adopted under the Employee Retirement
Income Security Act of 1974, as amended, regardless of whether such are
substantially similar to plan asset regulations currently applied or proposed by
the United States Department of Labor;

         (g) subject to the terms of Section 5.7, an amendment that, in the
discretion of the General Partner, is necessary or advisable in connection with
the authorization of issuance of any class or series of Partnership Securities
pursuant to Section 5.6;

         (h) any amendment expressly permitted in this Agreement to be made by
the General Partner acting alone;

         (i) an amendment effected, necessitated or contemplated by a Merger
Agreement approved in accordance with Section 14.3;

         (j) an amendment that, in the discretion of the General Partner, is
necessary or advisable to reflect, account for and deal with appropriately the
formation by the Partnership of,



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or investment by the Partnership in, any corporation, partnership, joint
venture, limited liability company or other entity, in connection with the
conduct by the Partnership of activities permitted by the terms of Section 2.4;

         (k) a merger or conveyance pursuant to Section 14.3(d);

         (l) an amendment to Section 11.2 that would reduce the percentage of
the Outstanding Units required for the Unitholders to remove the General
Partner; provided, however, that once such required percentage has been reduced,
it may be further reduced by the General Partner but such required percentage
may not be increased without a vote of the Unitholders; provided further,
however, that no such amendment may provide that any class Units may vote
separately as a class to remove the General Partner;

         (m) an amendment to the definition of "Outstanding" contained in
Section 1.1 hereof to increase from 20% or more the percentage of Outstanding
Partnership Securities, that if at any time acquired by any Person or Group,
shall not be voted on any matter and shall not be considered to be Outstanding
for the other purposes described in such definition; provided, however, that
once such percentage has been increased, it may be further increased by the
General Partner, but such required percentage may not be reduced without a vote
of the Unitholders; or

         (n) any other amendments substantially similar to the foregoing.

         Section 13.2 Amendment Procedures. Except as provided in Sections 13.1
and 13.3, all amendments to this Agreement shall be made in accordance with the
following requirements. Amendments to this Agreement may be proposed only by or
with the consent of the General Partner which consent may be given or withheld
in its sole discretion. A proposed amendment shall be effective upon its
approval by the holders of a Unit Majority, unless a greater or different
percentage is required under this Agreement or by Delaware law. Each proposed
amendment that requires the approval of the holders of a specified percentage of
Outstanding Units shall be set forth in a writing that contains the text of the
proposed amendment. If such an amendment is proposed, the General Partner shall
seek the written approval of the requisite percentage of Outstanding Units or
call a meeting of the Unitholders to consider and vote on such proposed
amendment. The General Partner shall notify all Record Holders upon final
adoption of any such proposed amendments.

         Section 13.3 Amendment Requirements.

         (a) Notwithstanding the provisions of Sections 13.1 and 13.2, no
provision of this Agreement that establishes a percentage of Outstanding Units
(including Units deemed owned by the General Partner) required to take any
action shall be amended, altered, changed, repealed or rescinded in any respect
that would have the effect of reducing such voting percentage unless such
amendment is approved by the written consent or the affirmative vote of holders
of Outstanding Units whose aggregate Outstanding Units constitute not less than
the voting requirement sought to be reduced.



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         (b) Notwithstanding the provisions of Sections 13.1 and 13.2, no
amendment to this Agreement may (i) enlarge the obligations of any Limited
Partner without its consent, unless such shall be deemed to have occurred as a
result of an amendment approved pursuant to Section 13.3(c), (ii) enlarge the
obligations of, restrict in any way any action by or rights of, or reduce in any
way the amounts distributable, reimbursable or otherwise payable to, the General
Partner or any of its Affiliates without its consent, which consent may be given
or withheld in its sole discretion, (iii) change Section 12.1(b), or (iv) change
the term of the Partnership or, except as set forth in Section 12.1(b), give any
Person the right to dissolve the Partnership.

         (c) Except as provided in Section 14.3, and without limitation of the
General Partner's authority to adopt amendments to this Agreement without the
approval of any Partners or Assignees as contemplated in Section 13.1, any
amendment that would have a material adverse effect on the rights or preferences
of any class of Partnership Interests in relation to other classes of
Partnership Interests must be approved by the holders of not less than a
majority of the Outstanding Partnership Interests of the class affected.

         (d) Notwithstanding any other provision of this Agreement, except for
amendments pursuant to Section 13.1 and except as otherwise provided by Section
14.3(b), no amendments shall become effective without the approval of the
holders of at least 90% of the Outstanding Units voting as a single class unless
the Partnership obtains an Opinion of Counsel to the effect that such amendment
will not affect the limited liability of any Limited Partner under applicable
law.

         (e) Except as provided in Section 13.1, this Section 13.3 shall only be
amended with the approval of the holders of at least 90% of the Outstanding
Units.

         Section 13.4 Special Meetings. All acts of Limited Partners to be taken
pursuant to this Agreement shall be taken in the manner provided in this Article
XIII. Special meetings of the Limited Partners may be called by the General
Partner or by Limited Partners owning 20% or more of the Outstanding Units of
the class or classes for which a meeting is proposed. Limited Partners shall
call a special meeting by delivering to the General Partner one or more requests
in writing stating that the signing Limited Partners wish to call a special
meeting and indicating the general or specific purposes for which the special
meeting is to be called. Within 60 days after receipt of such a call from
Limited Partners or within such greater time as may be reasonably necessary for
the Partnership to comply with any statutes, rules, regulations, listing
agreements or similar requirements governing the holding of a meeting or the
solicitation of proxies for use at such a meeting, the General Partner shall
send a notice of the meeting to the Limited Partners either directly or
indirectly through the Transfer Agent. A meeting shall be held at a time and
place determined by the General Partner on a date not less than 10 days nor more
than 60 days after the mailing of notice of the meeting. Limited Partners shall
not vote on matters that would cause the Limited Partners to be deemed to be
taking part in the management and control of the business and affairs of the
Partnership so as to jeopardize the Limited Partners' limited liability under
the Delaware Act or the law of any other state in which the Partnership is
qualified to do business.

         Section 13.5 Notice of a Meeting. Notice of a meeting called pursuant
to Section 13.4 shall be given to the Record Holders of the class or classes of
Units for which a meeting is



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proposed in writing by mail or other means of written communication in
accordance with Section 16.1. The notice shall be deemed to have been given at
the time when deposited in the mail or sent by other means of written
communication.

         Section 13.6 Record Date. For purposes of determining the Limited
Partners entitled to notice of or to vote at a meeting of the Limited Partners
or to give approvals without a meeting as provided in Section 13.11 the General
Partner may set a Record Date, which shall not be less than 10 nor more than 60
days before (a) the date of the meeting (unless such requirement conflicts with
any rule, regulation, guideline or requirement of any National Securities
Exchange on which the Units are listed for trading, in which case the rule,
regulation, guideline or requirement of such exchange shall govern) or (b) in
the event that approvals are sought without a meeting, the date by which Limited
Partners are requested in writing by the General Partner to give such approvals.

         Section 13.7 Adjournment. When a meeting is adjourned to another time
or place, notice need not be given of the adjourned meeting and a new Record
Date need not be fixed, if the time and place thereof are announced at the
meeting at which the adjournment is taken, unless such adjournment shall be for
more than 45 days. At the adjourned meeting, the Partnership may transact any
business which might have been transacted at the original meeting. If the
adjournment is for more than 45 days or if a new Record Date is fixed for the
adjourned meeting, a notice of the adjourned meeting shall be given in
accordance with this Article XIII.

         Section 13.8 Waiver of Notice; Approval of Meeting; Approval of
Minutes. The transactions of any meeting of Limited Partners, however called and
noticed, and whenever held, shall be as valid as if it had occurred at a meeting
duly held after regular call and notice, if a quorum is present either in person
or by proxy, and if, either before or after the meeting, Limited Partners
representing such quorum who were present in person or by proxy and entitled to
vote, sign a written waiver of notice or an approval of the holding of the
meeting or an approval of the minutes thereof. All waivers and approvals shall
be filed with the Partnership records or made a part of the minutes of the
meeting. Attendance of a Limited Partner at a meeting shall constitute a waiver
of notice of the meeting, except when the Limited Partner does not approve, at
the beginning of the meeting, of the transaction of any business because the
meeting is not lawfully called or convened; and except that attendance at a
meeting is not a waiver of any right to disapprove the consideration of matters
required to be included in the notice of the meeting, but not so included, if
the disapproval is expressly made at the meeting.

         Section 13.9 Quorum. The holders of a majority of the Outstanding Units
of the class or classes for which a meeting has been called (including
Outstanding Units deemed owned by the General Partner) represented in person or
by proxy shall constitute a quorum at a meeting of Limited Partners of such
class or classes unless any such action by the Limited Partners requires
approval by holders of a greater percentage of such Units, in which case the
quorum shall be such greater percentage. At any meeting of the Limited Partners
duly called and held in accordance with this Agreement at which a quorum is
present, the act of Limited Partners holding Outstanding Units that in the
aggregate represent a majority of the Outstanding Units entitled to vote and be
present in person or by proxy at such meeting shall be deemed to constitute the
act of all Limited Partners, unless a greater or different percentage is
required with respect to such action under the provisions of this Agreement, in
which case the act of the



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Limited Partners holding Outstanding Units that in the aggregate represent at
least such greater or different percentage shall be required. The Limited
Partners present at a duly called or held meeting at which a quorum is present
may continue to transact business until adjournment, notwithstanding the
withdrawal of enough Limited Partners to leave less than a quorum, if any action
taken (other than adjournment) is approved by the required percentage of
Outstanding Units specified in this Agreement (including Outstanding Units
deemed owned by the General Partner). In the absence of a quorum any meeting of
Limited Partners may be adjourned from time to time by the affirmative vote of
holders of at least a majority of the Outstanding Units entitled to vote at such
meeting (including Outstanding Units deemed owned by the General Partner)
represented either in person or by proxy, but no other business may be
transacted, except as provided in Section 13.7.

         Section 13.10 Conduct of a Meeting. The General Partner shall have full
power and authority concerning the manner of conducting any meeting of the
Limited Partners or solicitation of approvals in writing, including the
determination of Persons entitled to vote, the existence of a quorum, the
satisfaction of the requirements of Section 13.4, the conduct of voting, the
validity and effect of any proxies and the determination of any controversies,
votes or challenges arising in connection with or during the meeting or voting.
The General Partner shall designate a Person to serve as chairman of any meeting
and shall further designate a Person to take the minutes of any meeting. All
minutes shall be kept with the records of the Partnership maintained by the
General Partner. The General Partner may make such other regulations consistent
with applicable law and this Agreement as it may deem advisable concerning the
conduct of any meeting of the Limited Partners or solicitation of approvals in
writing, including regulations in regard to the appointment of proxies, the
appointment and duties of inspectors of votes and approvals, the submission and
examination of proxies and other evidence of the right to vote, and the
revocation of approvals in writing.

         Section 13.11 Action Without a Meeting. If authorized by the General
Partner, any action that may be taken at a meeting of the Limited Partners may
be taken without a meeting if an approval in writing setting forth the action so
taken is signed by Limited Partners owning not less than the minimum percentage
of the Outstanding Units (including Units deemed owned by the General Partner)
that would be necessary to authorize or take such action at a meeting at which
all the Limited Partners were present and voted (unless such provision conflicts
with any rule, regulation, guideline or requirement of any National Securities
Exchange on which the Units are listed for trading, in which case the rule,
regulation, guideline or requirement of such exchange shall govern). Prompt
notice of the taking of action without a meeting shall be given to the Limited
Partners who have not approved in writing. The General Partner may specify that
any written ballot submitted to Limited Partners for the purpose of taking any
action without a meeting shall be returned to the Partnership within the time
period, which shall be not less than 20 days, specified by the General Partner.
If a ballot returned to the Partnership does not vote all of the Units held by
the Limited Partners, the Partnership shall be deemed to have failed to receive
a ballot for the Units that were not voted. If approval of the taking of any
action by the Limited Partners is solicited by any Person other than by or on
behalf of the General Partner, the written approvals shall have no force and
effect unless and until (a) they are deposited with the Partnership in care of
the General Partner, (b) approvals sufficient to take the action proposed are
dated as of a date not more than 90 days prior to the date sufficient approvals
are deposited with the Partnership and (c) an Opinion of Counsel is delivered to
the General Partner to the effect



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that the exercise of such right and the action proposed to be taken with respect
to any particular matter (i) will not cause the Limited Partners to be deemed to
be taking part in the management and control of the business and affairs of the
Partnership so as to jeopardize the Limited Partners' limited liability, and
(ii) is otherwise permissible under the state statutes then governing the
rights, duties and liabilities of the Partnership and the Partners.

         Section 13.12 Voting and Other Rights.

         (a) Only those Record Holders of the Units on the Record Date set
pursuant to Section 13.6 (and also subject to the limitations contained in the
definition of "Outstanding") shall be entitled to notice of, and to vote at, a
meeting of Limited Partners or to act with respect to matters as to which the
holders of the Outstanding Units have the right to vote or to act. All
references in this Agreement to votes of, or other acts that may be taken by,
the Outstanding Units shall be deemed to be references to the votes or acts of
the Record Holders of such Outstanding Units.

         (b) With respect to Units that are held for a Person's account by
another Person (such as a broker, dealer, bank, trust company or clearing
corporation, or an agent of any of the foregoing), in whose name such Units are
registered, such other Person shall, in exercising the voting rights in respect
of such Units on any matter, and unless the arrangement between such Persons
provides otherwise, vote such Units in favor of, and at the direction of, the
Person who is the beneficial owner, and the Partnership shall be entitled to
assume it is so acting without further inquiry. The provisions of this Section
13.12(b) (as well as all other provisions of this Agreement) are subject to the
provisions of Section 4.3.

                                   ARTICLE XIV
                                     MERGER

         Section 14.1 Authority. The Partnership may merge or consolidate with
one or more corporations, limited liability companies, business trusts or
associations, real estate investment trusts, common law trusts or unincorporated
businesses, including a general partnership or limited partnership, formed under
the laws of any state of the United States of America, pursuant to a written
agreement of merger or consolidation ("Merger Agreement") in accordance with
this Article XIV.

         Section 14.2 Procedure for Merger or Consolidation. Merger or
consolidation of the Partnership pursuant to this Article XIV requires the prior
approval of the General Partner. If the General Partner shall determine, in the
exercise of its discretion, to consent to the merger or consolidation, the
General Partner shall approve the Merger Agreement, which shall set forth:

         (a) the names and jurisdictions of formation or organization of each of
the business entities proposing to merge or consolidate;

         (b) the name and jurisdiction of formation or organization of the
business entity that is to survive the proposed merger or consolidation (the
"Surviving Business Entity");

         (c) the terms and conditions of the proposed merger or consolidation;



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         (d) the manner and basis of exchanging or converting the equity
securities of each constituent business entity for, or into, cash, property or
general or limited partner interests, rights, securities or obligations of the
Surviving Business Entity; and (i) if any general or limited partner interests,
securities or rights of any constituent business entity are not to be exchanged
or converted solely for, or into, cash, property or general or limited partner
interests, rights, securities or obligations of the Surviving Business Entity,
the cash, property or general or limited partner interests, rights, securities
or obligations of any limited partnership, corporation, trust or other entity
(other than the Surviving Business Entity) which the holders of such general or
limited partner interests, securities or rights are to receive in exchange for,
or upon conversion of their general or limited partner interests, securities or
rights, and (ii) in the case of securities represented by certificates, upon the
surrender of such certificates, which cash, property or general or limited
partner interests, rights, securities or obligations of the Surviving Business
Entity or any general or limited partnership, corporation, trust or other entity
(other than the Surviving Business Entity), or evidences thereof, are to be
delivered;

         (e) a statement of any changes in the constituent documents or the
adoption of new constituent documents (the articles or certificate of
incorporation, articles of trust, declaration of trust, certificate or agreement
of limited partnership or other similar charter or governing document) of the
Surviving Business Entity to be effected by such merger or consolidation;

         (f) the effective time of the merger, which may be the date of the
filing of the certificate of merger pursuant to Section 14.4 or a later date
specified in or determinable in accordance with the Merger Agreement (provided,
that if the effective time of the merger is to be later than the date of the
filing of the certificate of merger, the effective time shall be fixed no later
than the time of the filing of the certificate of merger and stated therein);
and

         (g) such other provisions with respect to the proposed merger or
consolidation as are deemed necessary or appropriate by the General Partner.

         Section 14.3 Approval by Limited Partners of Merger or Consolidation.

         (a) Except as provided in Section 14.3(d), the General Partner, upon
its approval of the Merger Agreement, shall direct that the Merger Agreement be
submitted to a vote of Limited Partners, whether at a special meeting or by
written consent, in either case in accordance with the requirements of Article
XIII. A copy or a summary of the Merger Agreement shall be included in or
enclosed with the notice of a special meeting or the written consent.

         (b) Except as provided in Section 14.3(d), the Merger Agreement shall
be approved upon receiving the affirmative vote or consent of the holders of a
Unit Majority unless the Merger Agreement contains any provision that, if
contained in an amendment to this Agreement, the provisions of this Agreement or
the Delaware Act would require for its approval the vote or consent of a greater
percentage of the Outstanding Units or of any class of Limited Partners, in
which case such greater percentage vote or consent shall be required for
approval of the Merger Agreement.

         (c) Except as provided in Section 14.3(d), after such approval by vote
or consent of the Limited Partners, and at any time prior to the filing of the
certificate of merger pursuant to



                                       90
<PAGE>



Section 14.4, the merger or consolidation may be abandoned pursuant to
provisions therefor, if any, set forth in the Merger Agreement.

         (d) Notwithstanding anything else contained in this Article XIV or in
this Agreement, the General Partner is permitted, in its discretion, without
Limited Partner approval, to merge the Partnership or any Group Member into, or
convey all of the Partnership's assets to, another limited liability entity
which shall be newly formed and shall have no assets, liabilities or operations
at the time of such Merger other than those it receives from the Partnership or
other Group Member if (i) the General Partner has received an Opinion of Counsel
that the merger or conveyance, as the case may be, would not result in the loss
of the limited liability of any Limited Partner or any Group Member or cause the
Partnership or any Group Member to be treated as an association taxable as a
corporation or otherwise to be taxed as an entity for federal income tax
purposes (to the extent not previously treated as such), (ii) the sole purpose
of such merger or conveyance is to effect a mere change in the legal form of the
Partnership into another limited liability entity and (iii) the governing
instruments of the new entity provide the Limited Partners and the General
Partner with the same rights and obligations as are herein contained.

         Section 14.4 Certificate of Merger. Upon the required approval by the
General Partner and the Unitholders of a Merger Agreement, a certificate of
merger shall be executed and filed with the Secretary of State of the State of
Delaware in conformity with the requirements of the Delaware Act.

         Section 14.5 Effect of Merger.

         (a) At the effective time of the certificate of merger:

                  (i) all of the rights, privileges and powers of each of the
         business entities that has merged or consolidated, and all property,
         real, personal and mixed, and all debts due to any of those business
         entities and all other things and causes of action belonging to each of
         those business entities, shall be vested in the Surviving Business
         Entity and after the merger or consolidation shall be the property of
         the Surviving Business Entity to the extent they were of each
         constituent business entity;

                  (ii) the title to any real property vested by deed or
         otherwise in any of those constituent business entities shall not
         revert and is not in any way impaired because of the merger or
         consolidation;

                  (iii) all rights of creditors and all liens on or security
         interests in property of any of those constituent business entities
         shall be preserved unimpaired; and

                  (iv) all debts, liabilities and duties of those constituent
         business entities shall attach to the Surviving Business Entity and may
         be enforced against it to the same extent as if the debts, liabilities
         and duties had been incurred or contracted by it.

         (b) A merger or consolidation effected pursuant to this Article shall
not be deemed to result in a transfer or assignment of assets or liabilities
from one entity to another.



                                       91
<PAGE>



                                   ARTICLE XV
                   RIGHT TO ACQUIRE LIMITED PARTNER INTERESTS

         Section 15.1 Right to Acquire Limited Partner Interests.

         (a) Notwithstanding any other provision of this Agreement, if at any
time the General Partner and its Affiliates hold more than 80% of the total
Limited Partner Interests of any class then Outstanding, the General Partner
shall then have the right, which right it may assign and transfer in whole or in
part to the Partnership or any Affiliate of the General Partner, exercisable in
its sole discretion, to purchase all, but not less than all, of such Limited
Partner Interests of such class then Outstanding held by Persons other than the
General Partner and its Affiliates, at the greater of (x) the Current Market
Price as of the date three days prior to the date that the notice described in
Section 15.1(b) is mailed and (y) the highest price paid by the General Partner
or any of its Affiliates for any such Limited Partner Interest of such class
purchased during the 90-day period preceding the date that the notice described
in Section 15.1(b) is mailed. As used in this Agreement, (i) "Current Market
Price" as of any date of any class of Limited Partner Interests means the
average of the daily Closing Prices (as hereinafter defined) per Limited Partner
Interest of such class for the 20 consecutive Trading Days (as hereinafter
defined) immediately prior to such date; (ii) "Closing Price" for any day means
the last sale price on such day, regular way, or in case no such sale takes
place on such day, the average of the closing bid and asked prices on such day,
regular way, in either case as reported in the principal consolidated
transaction reporting system with respect to securities listed or admitted for
trading on the principal National Securities Exchange (other than the Nasdaq
Stock Market) on which such Limited Partner Interests of such class are listed
or admitted to trading or, if such Limited Partner Interests of such class are
not listed or admitted to trading on any National Securities Exchange (other
than the Nasdaq Stock Market), the last quoted price on such day or, if not so
quoted, the average of the high bid and low asked prices on such day in the
over-the-counter market, as reported by the Nasdaq Stock Market or such other
system then in use, or, if on any such day such Limited Partner Interests of
such class are not quoted by any such organization, the average of the closing
bid and asked prices on such day as furnished by a professional market maker
making a market in such Limited Partner Interests of such class selected by the
General Partner, or if on any such day no market maker is making a market in
such Limited Partner Interests of such class, the fair value of such Limited
Partner Interests on such day as determined reasonably and in good faith by the
General Partner; and (iii) "Trading Day" means a day on which the principal
National Securities Exchange on which such Limited Partner Interests of any
class are listed or admitted to trading is open for the transaction of business
or, if Limited Partner Interests of a class are not listed or admitted to
trading on any National Securities Exchange, a day on which banking institutions
in New York City generally are open.

         (b) If the General Partner, any Affiliate of the General Partner or the
Partnership elects to exercise the right to purchase Limited Partner Interests
granted pursuant to Section 15.1(a), the General Partner shall deliver to the
Transfer Agent notice of such election to purchase (the "Notice of Election to
Purchase") and shall cause the Transfer Agent to mail a copy of such Notice of
Election to Purchase to the Record Holders of Limited Partner Interests of such
class (as of a Record Date selected by the General Partner) at least 10, but not
more than 60, days prior to the Purchase Date. Such Notice of Election to
Purchase shall also be published for a period of at least three consecutive days
in at least two daily newspapers of general circulation




                                       92
<PAGE>



printed in the English language and published in the Borough of Manhattan, New
York. The Notice of Election to Purchase shall specify the Purchase Date and the
price (determined in accordance with Section 15.1(a)) at which Limited Partner
Interests will be purchased and state that the General Partner, its Affiliate or
the Partnership, as the case may be, elects to purchase such Limited Partner
Interests (upon surrender of Certificates representing such Limited Partner
Interests in exchange for payment, if applicable) at such office or offices of
the Transfer Agent as the Transfer Agent may specify, or as may be required by
any National Securities Exchange on which such Limited Partner Interests are
listed or admitted to trading. Any such Notice of Election to Purchase mailed to
a Record Holder of Limited Partner Interests at his address as reflected in the
records of the Transfer Agent shall be conclusively presumed to have been given
regardless of whether the owner receives such notice. On or prior to the
Purchase Date, the General Partner, its Affiliate or the Partnership, as the
case may be, shall deposit with the Transfer Agent cash in an amount sufficient
to pay the aggregate purchase price of all of such Limited Partner Interests to
be purchased in accordance with this Section 15.1. If the Notice of Election to
Purchase shall have been duly given as aforesaid at least 10 days prior to the
Purchase Date, and if on or prior to the Purchase Date the deposit described in
the preceding sentence has been made for the benefit of the holders of Limited
Partner Interests subject to purchase as provided herein, then from and after
the Purchase Date, notwithstanding that any Certificate shall not have been
surrendered for purchase, all rights of the holders of such Limited Partner
Interests (including any rights pursuant to Articles IV, V, VI, and XII) shall
thereupon cease, except the right to receive the purchase price (determined in
accordance with Section 15.1(a)) for Limited Partner Interests therefor, without
interest, upon surrender to the Transfer Agent of the Certificates representing
such Limited Partner Interests, and such Limited Partner Interests shall
thereupon be deemed to be transferred to the General Partner, its Affiliate or
the Partnership, as the case may be, on the record books of the Transfer Agent
and the Partnership, and the General Partner or any Affiliate of the General
Partner, or the Partnership, as the case may be, shall be deemed to be the owner
of all such Limited Partner Interests from and after the Purchase Date and shall
have all rights as the owner of such Limited Partner Interests (including all
rights as owner of such Limited Partner Interests pursuant to Articles IV, V, VI
and XII).

         (c) At any time from and after the Purchase Date, a holder of an
Outstanding Limited Partner Interest subject to purchase as provided in this
Section 15.1 may surrender his Certificate evidencing such Limited Partner
Interest to the Transfer Agent in exchange for payment of the amount described
in Section 15.1(a), therefor, without interest thereon.

                                   ARTICLE XVI
                               GENERAL PROVISIONS

         Section 16.1 Addresses and Notices. Any notice, demand, request, report
or proxy materials required or permitted to be given or made to a Partner or
Assignee under this Agreement shall be in writing and shall be deemed given or
made when delivered in person or when sent by first class United States mail or
by other means of written communication to the Partner or Assignee at the
address described below. Any notice, payment or report to be given or made to a
Partner or Assignee hereunder shall be deemed conclusively to have been given or
made, and the obligation to give such notice or report or to make such payment
shall be deemed conclusively to have been fully satisfied, upon sending of such
notice, payment or report to the Record Holder of such Partnership Securities at
his address as shown on the records of the



                                       93
<PAGE>



Transfer Agent or as otherwise shown on the records of the Partnership,
regardless of any claim of any Person who may have an interest in such
Partnership Securities by reason of any assignment or otherwise. An affidavit or
certificate of making of any notice, payment or report in accordance with the
provisions of this Section 16.1 executed by the General Partner, the Transfer
Agent or the mailing organization shall be prima facie evidence of the giving or
making of such notice, payment or report. If any notice, payment or report
addressed to a Record Holder at the address of such Record Holder appearing on
the books and records of the Transfer Agent or the Partnership is returned by
the United States Postal Service marked to indicate that the United States
Postal Service is unable to deliver it, such notice, payment or report and any
subsequent notices, payments and reports shall be deemed to have been duly given
or made without further mailing (until such time as such Record Holder or
another Person notifies the Transfer Agent or the Partnership of a change in his
address) if they are available for the Partner or Assignee at the principal
office of the Partnership for a period of one year from the date of the giving
or making of such notice, payment or report to the other Partners and Assignees.
Any notice to the Partnership shall be deemed given if received by the General
Partner at the principal office of the Partnership designated pursuant to
Section 2.3. The General Partner may rely and shall be protected in relying on
any notice or other document from a Partner, Assignee or other Person if
believed by it to be genuine.

         Section 16.2 Further Action. The parties shall execute and deliver all
documents, provide all information and take or refrain from taking action as may
be necessary or appropriate to achieve the purposes of this Agreement.

         Section 16.3 Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their heirs, executors,
administrators, successors, legal representatives and permitted assigns.

         Section 16.4 Integration. This Agreement constitutes the entire
agreement among the parties hereto pertaining to the subject matter hereof and
supersedes all prior agreements and understandings pertaining thereto.

         Section 16.5 Creditors. None of the provisions of this Agreement shall
be for the benefit of, or shall be enforceable by, any creditor of the
Partnership.

         Section 16.6 Waiver. No failure by any party to insist upon the strict
performance of any covenant, duty, agreement or condition of this Agreement or
to exercise any right or remedy consequent upon a breach thereof shall
constitute waiver of any such breach of any other covenant, duty, agreement or
condition.

         Section 16.7 Counterparts. This Agreement may be executed in
counterparts, all of which together shall constitute an agreement binding on all
the parties hereto, notwithstanding that all such parties are not signatories to
the original or the same counterpart. Each party shall become bound by this
Agreement immediately upon affixing its signature hereto or, in the case of a
Person acquiring a Unit, upon accepting the certificate evidencing such Unit, or
executing and delivering either a Transfer Application as herein described or
any other document satisfactory to the General Partner evidencing such party's
agreement to comply with and be bound by this Agreement, independently of the
signature of any other party.



                                       94
<PAGE>



         Section 16.8 Applicable Law. This Agreement shall be construed in
accordance with and governed by the laws of the State of Delaware, without
regard to the principles of conflicts of law.

         Section 16.9 Invalidity of Provisions. If any provision of this
Agreement is or becomes invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not be affected thereby.

         Section 16.10 Consent of Partners. Each Partner hereby expressly
consents and agrees that, whenever in this Agreement it is specified that an
action may be taken upon the affirmative vote or consent of less than all of the
Partners, such action may be so taken upon the concurrence of less than all of
the Partners and each Partner shall be bound by the results of such action.




                                       95
<PAGE>
         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.

                                     GENERAL PARTNER:

                                     MARTIN MIDSTREAM GP LLC


                                     By: /s/ Ruben S. Martin, III
                                         Name:  Ruben S. Martin, III
                                         Title: Chief Executive Officer


                                     ORGANIZATIONAL LIMITED PARTNER:


                                     MARTIN RESOURCE LLC

                                     By: Martin Resource Management Corporation,
                                         its sole member

                                     By: /s/ Ruben S. Martin, III
                                         Name:  Ruben S. Martin, III
                                         Title: President

                                     LIMITED PARTNERS:

                                     All Limited Partners now
                                     and hereafter admitted as
                                     Limited Partners of the
                                     Partnership, pursuant to
                                     powers of attorney now and
                                     hereafter executed in favor
                                     of, and granted and
                                     delivered to the General
                                     Partner.

                                     MARTIN MIDSTREAM GP LLC


                                     By: /s/ Ruben S. Martin, III
                                         Name:  Ruben S. Martin, III
                                         Title: President




                                       96
<PAGE>




                                    EXHIBIT A
                            TO THE FIRST AMENDED AND
                  RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF
                         MARTIN MIDSTREAM PARTNERS L.P.
                       CERTIFICATE EVIDENCING COMMON UNITS
                    REPRESENTING LIMITED PARTNER INTERESTS IN
                         MARTIN MIDSTREAM PARTNERS L.P.

No.                                                                 Common Units
    ----------                                           ----------

         In accordance with Section 4.1 of the First Amended and Restated
Agreement of Limited Partnership of Martin Midstream Partners L.P., as amended,
supplemented or restated from time to time (the "Partnership Agreement"), Martin
Midstream Partners L.P., a Delaware limited partnership (the "Partnership"),
hereby certifies that ___________________ (the "Holder") is the registered owner
of Common Units representing limited partner interests in the Partnership (the
"Common Units") transferable on the books of the Partnership, in person or by
duly authorized attorney, upon surrender of this Certificate properly endorsed
and accompanied by a properly executed application for transfer of the Common
Units represented by this Certificate. The rights, preferences and limitations
of the Common Units are set forth in, and this Certificate and the Common Units
represented hereby are issued and shall in all respects be subject to the terms
and provisions of, the Partnership Agreement. Copies of the Partnership
Agreement are on file at, and will be furnished without charge on delivery of
written request to the Partnership at, the principal office of the Partnership
located at 4200 Stone Road, Kilgore, Texas 75662. Capitalized terms used herein
but not defined shall have the meanings given them in the Partnership Agreement.

         The Holder, by accepting this Certificate, is deemed to have (i)
requested admission as, and agreed to become, a Limited Partner and to have
agreed to comply with and be bound by and to have executed the Partnership
Agreement, (ii) represented and warranted that the Holder has all right, power
and authority and, if an individual, the capacity necessary to enter into the
Partnership Agreement, (iii) granted the powers of attorney provided for in the
Partnership Agreement and (iv) made the waivers and given the consents and
approvals contained in the Partnership Agreement.

         This Certificate shall not be valid for any purpose unless it has been
countersigned and registered by the Transfer Agent and Registrar.


Dated:                                    Martin Midstream Partners L.P.
      ---------------

Countersigned and Registered by:          By: Martin Midstream GP LLC, its
                                              General Partner

                                          By:
-------------------------------              -----------------------------------
as Transfer Agent and Registrar           Name:
                                               ---------------------------------

By:                                       By:
   ----------------------------------        -----------------------------------
          Authorized Signature                          Secretary



                                       1
<PAGE>
                            [REVERSE OF CERTIFICATE]

                                  ABBREVIATIONS

       The following abbreviations, when used in the inscription on the face
of this Certificate, shall be construed as follows according to applicable laws
or regulations:

TEN COM - as tenants in common               UNIF GIFT/TRANSFERS MIN ACT
TEN ENT - as tenants by the entireties       __________ Custodian _________
                                             (Cust)                     (Minor)
JT TEN -  as joint tenants with right of     under Uniform Gifts/Transfers to CD
          survivorship and not as            Minors Act (State)
          tenants in common

       Additional abbreviations, though not in the above list, may also be used.

                           ASSIGNMENT OF COMMON UNITS
                                       IN
                         MARTIN MIDSTREAM PARTNERS L.P.
              IMPORTANT NOTICE REGARDING INVESTOR RESPONSIBILITIES
                          DUE TO TAX SHELTER STATUS OF
                         MARTIN MIDSTREAM PARTNERS L.P.

       You have acquired an interest in Martin Midstream Partners L.P., 4200
Stone Road, Kilgore, Texas 75662, whose taxpayer identification number is
05-0527861. The Internal Revenue Service has issued Martin Midstream Partners
L.P. the following tax shelter registration number: __________________.

       YOU MUST REPORT THIS REGISTRATION NUMBER TO THE INTERNAL REVENUE SERVICE
IF YOU CLAIM ANY DEDUCTION, LOSS, CREDIT OR OTHER TAX BENEFIT OR REPORT ANY
INCOME BY REASON OF YOUR INVESTMENT IN MARTIN MIDSTREAM PARTNERS L.P.

       You must report the registration number as well as the name and taxpayer
identification number of Martin Midstream Partners L.P. on Form 8271. FORM 8271
MUST BE ATTACHED TO THE RETURN ON WHICH YOU CLAIM THE DEDUCTION, LOSS, CREDIT OR
OTHER TAX BENEFIT OR REPORT ANY INCOME BY REASON OF YOUR INVESTMENT IN MARTIN
MIDSTREAM PARTNERS L.P.

       If you transfer your interest in Martin Midstream Partners L.P. to
another person, you are required by the Internal Revenue Service to keep a list
containing (a) that person's name, address and taxpayer identification number,
(b) the date on which you transferred the interest and (c) the name, address and
tax shelter registration number of Martin Midstream Partners L.P. If you do not
want to keep such a list, you must (1) send the information specified above to
the Partnership, which will keep the list for this tax shelter, and (2) give a
copy of this notice to the person to whom you transfer your interest. Your
failure to comply with any of the above-



                                       2
<PAGE>
described responsibilities could result in the imposition of a penalty under
Section 6707(b) or 6708(a) of the Internal Revenue Code of 1986, as amended,
unless such failure is shown to be due to reasonable cause.

         ISSUANCE OF A REGISTRATION NUMBER DOES NOT INDICATE THAT THIS
INVESTMENT OR THE CLAIMED TAX BENEFITS HAVE BEEN REVIEWED, EXAMINED OR APPROVED
BY THE INTERNAL REVENUE SERVICE.

         FOR VALUE RECEIVED, _______________ hereby assigns, conveys, sells and
transfers unto

____________________________________       ____________________________________
(Please print or typewrite name            (Please insert Social Security or
and address of Assignee)                   other identifying number of Assignee)

__________ Common Units representing limited partner interests evidenced by this
Certificate, subject to the Partnership Agreement, and does hereby irrevocably
constitute and appoint ______________ as its attorney-in-fact with full power of
substitution to transfer the same on the books of Martin Midstream Partners L.P.

<Table>
<S>                                              <C>
Date:                                            NOTE:       The signature to any endorsement hereon must correspond with the
         ---------------------------                         name as written upon the face of this Certificate in every
                                                             particular, without alteration, enlargement or change.
SIGNATURE(S) MUST BE GUARANTEED BY A MEMBER
FIRM OF THE NATIONAL ASSOCIATION OF SECURITIES                                                    - (Signature)
DEALERS, INC. OR BY A COMMERCIAL BANK OR TRUST               ------------------------------------
COMPANY SIGNATURE(S) GUARANTEED
                                                                                                  - (Signature)
                                                             ------------------------------------
-----------------------------
</Table>

         No transfer of the Common Units evidenced hereby will be registered on
the books of the Partnership, unless the Certificate evidencing the Common Units
to be transferred is surrendered for registration or transfer and an Application
for Transfer of Common Units has been executed by a transferee either (a) on the
form set forth below or (b) on a separate application that the Partnership will
furnish on request without charge. A transferor of the Common Units shall have
no duty to the transferee with respect to execution of the transfer application
in order for such transferee to obtain registration of the transfer of the
Common Units.



                                       3
<PAGE>



                    APPLICATION FOR TRANSFER OF COMMON UNITS

         The undersigned ("Assignee") hereby applies for transfer to the name of
the Assignee of the Common Units evidenced hereby.

         The Assignee (a) requests admission as a Substituted Limited Partner
and agrees to comply with and be bound by, and hereby executes, the First
Amended and Restated Agreement of Limited Partnership of Martin Midstream
Partners L.P. (the "Partnership"), as amended, supplemented or restated to the
date hereof (the "Partnership Agreement"), (b) represents and warrants that the
Assignee has all right, power and authority and, if an individual, the capacity
necessary to enter into the Partnership Agreement, (c) appoints the General
Partner of the Partnership and, if a Liquidator shall be appointed, the
Liquidator of the Partnership as the Assignee's attorney-in-fact to execute,
swear to, acknowledge and file any document, including, without limitation, the
Partnership Agreement and any amendment thereto and the Certificate of Limited
Partnership of the Partnership and any amendment thereto, necessary or
appropriate for the Assignee's admission as a Substituted Limited Partner and as
a party to the Partnership Agreement, (d) gives the powers of attorney provided
for in the Partnership Agreement, and (e) makes the waivers and gives the
consents and approvals contained in the Partnership Agreement. Capitalized terms
not defined herein have the meanings assigned to such terms in the Partnership
Agreement.

Date:
     ----------------------

<Table>
<S>                                                                        <C>
---------------------------------------------------            -------------------------------
   Social Security or other identifying number                      Signature of Assignee


---------------------------------------------------            -------------------------------
   Purchase Price including commissions, if any                  Name and Address of Assignee
</Table>

Type of Entity (check one):

        [ ]  Individual            [ ]  Partnership          [ ]  Corporation

        [ ]  Trust                 [ ]  Other (specify)

Nationality (check one):

        [ ]  U.S. Citizen, Resident or Domestic Entity

        [ ]  Foreign Corporation   [ ]  Non-resident Alien

         If the U.S. Citizen, Resident or Domestic Entity box is checked, the
following certification must be completed.

         Under Section 1445(e) of the Internal Revenue Code of 1986, as amended
(the "Code"), the Partnership must withhold tax with respect to certain
transfers of property if a holder of an interest in the Partnership is a foreign
person. To inform the Partnership that no withholding is



                                       4
<PAGE>



required with respect to the undersigned interestholder's interest in it, the
undersigned hereby certifies the following (or, if applicable, certifies the
following on behalf of the interestholder).

Complete Either A or B:

A.       Individual Interestholder

         1.       I am not a non-resident alien for purposes of U.S. income
                  taxation.

         2.       My U.S. taxpayer identification number (Social Security
                  Number) is __________.

         3.       My home address is __________________________________________.


B.       Partnership, Corporation or Other Interestholder


         1.       ________________ (Name of Interestholder) is not a foreign
                  corporation, foreign partnership, foreign trust or foreign
                  estate (as those terms are defined in the Code and Treasury
                  Regulations).

         2.       The interestholder's U.S. employer identification number is
                  ___________.

         3.       The interestholder's office address and place of incorporation
                  (if applicable) is_______________.

         The interestholder agrees to notify the Partnership within sixty (60)
days of the date the interestholder becomes a foreign person.

         The interestholder understands that this certificate may be disclosed
to the Internal Revenue Service by the Partnership and that any false statement
contained herein could be punishable by fine, imprisonment or both.

         Under penalties of perjury, I declare that I have examined this
certification and to the best of my knowledge and belief it is true, correct and
complete and, if applicable, I further declare that I have authority to sign
this document on behalf of:


                        --------------------------------
                             Name of Interestholder

                        --------------------------------
                               Signature and Date

                        --------------------------------
                              Title (if applicable)

         Note: If the Assignee is a broker, dealer, bank, trust company,
clearing corporation, other nominee holder or an agent of any of the foregoing,
and is holding for the account of any other person, this application should be
completed by an officer thereof or, in the case of a broker or dealer, by a
registered representative who is a member of a registered national securities
exchange or a member of the National Association of Securities Dealers, Inc.,
or, in the case of any other nominee holder, a person performing a similar
function. If the Assignee is a broker,




                                       5
<PAGE>



dealer, bank, trust company, clearing corporation, other nominee owner or an
agent of any of the foregoing, the above certification as to any person for whom
the Assignee will hold the Common Units shall be made to the best of the
Assignee's knowledge.






                                       6

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3.2
<SEQUENCE>5
<FILENAME>d00990exv3w2.txt
<DESCRIPTION>AMENDED AND RESTATED AGREMEENT OF LTD PARTNERSHIP
<TEXT>
<PAGE>
                                                                     EXHIBIT 3.2

                                                                  EXECUTION COPY



              AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP


                                       OF


                        MARTIN OPERATING PARTNERSHIP L.P.


<PAGE>


                                TABLE OF CONTENTS

<Table>
<Caption>

                                                                                                                Page
                                                                                                                ----

<S>      <C>                                                                                                    <C>
ARTICLE I DEFINITIONS.............................................................................................1
         Section 1.1 Definitions..................................................................................1
         Section 1.2 Construction................................................................................10

ARTICLE II ORGANIZATION..........................................................................................10
         Section 2.1 Formation...................................................................................10
         Section 2.2 Name........................................................................................11
         Section 2.3 Registered Office; Registered Agent; Principal Office; Other Offices........................11
         Section 2.4 Purpose and Business........................................................................11
         Section 2.5 Powers......................................................................................12
         Section 2.6 Power of Attorney...........................................................................12
         Section 2.7 Term........................................................................................13
         Section 2.8 Title to Partnership Assets.................................................................13

ARTICLE III RIGHTS OF LIMITED PARTNERS...........................................................................14
         Section 3.1 Limitation of Liability.....................................................................14
         Section 3.2 Management of Business......................................................................14
         Section 3.3 Outside Activities of the Limited Partners..................................................14
         Section 3.4 Rights of Limited Partners..................................................................14

ARTICLE IV TRANSFERS OF PARTNERSHIP INTERESTS....................................................................15
         Section 4.1 Transfer Generally..........................................................................15
         Section 4.2 Transfer of General Partner's General Partner Interest......................................15
         Section 4.3 Transfer of a Limited Partner's Partnership Interest........................................16
         Section 4.4 Restrictions on Transfers...................................................................16

ARTICLE V CAPITAL CONTRIBUTIONS AND ISSUANCE OF PARTNERSHIP INTERESTS............................................17
         Section 5.1 Initial Contributions.......................................................................17
         Section 5.2 Contributions Pursuant to the Contribution Agreement........................................17
         Section 5.3 Additional Capital Contributions............................................................17
         Section 5.4 Interest and Withdrawal.....................................................................18
         Section 5.5 Capital Accounts............................................................................18
         Section 5.6 Loans from Partners.........................................................................20
         Section 5.7 Issuances of Additional Partnership Securities..............................................21
         Section 5.8 Limited Preemptive Rights...................................................................21
         Section 5.9 Fully Paid and Non-Assessable Nature of Limited Partner Interests...........................22

ARTICLE VI ALLOCATIONS AND DISTRIBUTIONS.........................................................................22
         Section 6.1 Allocations for Capital Account Purposes....................................................22
         Section 6.2 Allocations for Tax Purposes................................................................26
         Section 6.3 Distributions...............................................................................28
</Table>



                                       i

<PAGE>



<Table>

<S>      <C>                                                                                                   <C>
ARTICLE VII MANAGEMENT AND OPERATION OF BUSINESS.................................................................28
         Section 7.1 Management..................................................................................28
         Section 7.2 Certificate of Limited Partnership..........................................................30
         Section 7.3 Restrictions on the General Partner's Authority.............................................30
         Section 7.4 Reimbursement of the General Partner........................................................31
         Section 7.5 Outside Activities..........................................................................32
         Section 7.6 Loans from the General Partner; Loans or Contributions from the
                     Partnership; Contracts with Affiliates; Certain Restrictions on the General
                     Partner.....................................................................................33
         Section 7.7 Indemnification.............................................................................34
         Section 7.8 Liability of Indemnitees....................................................................36
         Section 7.9 Resolution of Conflicts of Interest.........................................................36
         Section 7.10 Other Matters Concerning the General Partner...............................................38
         Section 7.11 Reliance by Third Parties..................................................................39

ARTICLE VIII BOOKS, RECORDS AND ACCOUNTING.......................................................................39
         Section 8.1 Records and Accounting......................................................................39
         Section 8.2 Fiscal Year.................................................................................39

ARTICLE IX TAX MATTERS...........................................................................................40
         Section 9.1 Tax Returns and Information.................................................................40
         Section 9.2 Tax Elections...............................................................................40
         Section 9.3 Tax Controversies...........................................................................40
         Section 9.4 Withholding.................................................................................40

ARTICLE X ADMISSION OF PARTNERS..................................................................................41
         Section 10.1 Admission of Partners......................................................................41
         Section 10.2 Admission of Substituted Limited Partner...................................................41
         Section 10.3 Admission of Additional Limited Partners...................................................41
         Section 10.4 Admission of Successor or Transferee General Partner.......................................42
         Section 10.5 Amendment of Agreement and Certificate of Limited Partnership..............................42

ARTICLE XI WITHDRAWAL OR REMOVAL OF PARTNERS.....................................................................42
         Section 11.1 Withdrawal of the General Partner..........................................................42
         Section 11.2 Removal of the General Partner.............................................................44
         Section 11.3 Interest of Departing Partner..............................................................44
         Section 11.4 Withdrawal of a Limited Partner............................................................44

ARTICLE XII DISSOLUTION AND LIQUIDATION..........................................................................45
         Section 12.1 Dissolution................................................................................45
         Section 12.2 Continuation of the Business of the Partnership After Dissolution..........................45
         Section 12.3 Liquidator.................................................................................46
         Section 12.4 Liquidation................................................................................46
         Section 12.5 Cancellation of Certificate of Limited Partnership.........................................47
         Section 12.6 Return of Contributions....................................................................47
         Section 12.7 Waiver of Partition........................................................................47
         Section 12.8 Capital Account Restoration................................................................47
</Table>



                                       ii

<PAGE>

<Table>


<S>      <C>                                                                                                   <C>
ARTICLE XIII AMENDMENT OF PARTNERSHIP AGREEMENT..................................................................48
         Section 13.1 Amendment to be Adopted Solely by the General Partner......................................48
         Section 13.2 Amendment Procedures.......................................................................49

ARTICLE XIV MERGER...............................................................................................49
         Section 14.1 Authority..................................................................................49
         Section 14.2 Procedure for Merger or Consolidation......................................................49
         Section 14.3 Approval by Limited Partners of Merger or Consolidation....................................50
         Section 14.4 Certificate of Merger......................................................................51
         Section 14.5 Effect of Merger...........................................................................51

ARTICLE XV GENERAL PROVISIONS....................................................................................52
         Section 15.1 Addresses and Notices......................................................................52
         Section 15.2 Further Action.............................................................................52
         Section 15.3 Binding Effect.............................................................................52
         Section 15.4 Integration................................................................................52
         Section 15.5 Creditors..................................................................................52
         Section 15.6 Waiver.....................................................................................52
         Section 15.7 Counterparts...............................................................................52
         Section 15.8 Applicable Law.............................................................................53
         Section 15.9 Invalidity of Provisions...................................................................53
         Section 15.10 Consent of Partners.......................................................................53
</Table>


                                      iii

<PAGE>

              AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
                                       OF
                        MARTIN OPERATING PARTNERSHIP L.P.

         This AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP of MARTIN
OPERATING PARTNERSHIP L.P., dated as of November 6, 2002, is entered into by and
between Martin Operating GP LLC, a Delaware limited liability company, as the
General Partner, and Martin Midstream Partners L.P., a Delaware limited
partnership, as the Limited Partner, together with any other Persons who
hereafter become Partners in the Partnership or parties hereto as provided
herein.

                                   ARTICLE I
                                   DEFINITIONS


                  Section 1.1 Definitions. The following definitions shall be
for all purposes, unless otherwise clearly indicated to the contrary, applied to
the terms used in this Agreement. Capitalized terms used herein but not
otherwise defined shall have the meanings assigned to such terms in the MLP
Agreement.

                  "Additional Limited Partner" means a Person admitted to the
         Partnership as a Limited Partner pursuant to Section 10.3 and who is
         shown as such on the books and records of the Partnership.

                  "Adjusted Capital Account" means the Capital Account
         maintained for each Partner as of the end of each fiscal year of the
         Partnership, (a) increased by any amounts that such Partner is
         obligated to restore under the standards set by Treasury Regulation
         Section 1.704-1(b)(2)(ii)(c) (or is deemed obligated to restore under
         Treasury Regulation Sections 1.704-2(g) and 1.704-2(i)(5)) and (b)
         decreased by (i) the amount of all losses and deductions that, as of
         the end of such fiscal year, are reasonably expected to be allocated to
         such Partner in subsequent years under Sections 704(e)(2) and 706(d) of
         the Code and Treasury Regulation Section 1.751-1(b)(2)(ii), and (ii)
         the amount of all distributions that, as of the end of such fiscal
         year, are reasonably expected to be made to such Partner in subsequent
         years in accordance with the terms of this Agreement or otherwise to
         the extent they exceed offsetting increases to such Partner's Capital
         Account that are reasonably expected to occur during (or prior to) the
         year in which such distributions are reasonably expected to be made
         (other than increases as a result of a minimum gain chargeback pursuant
         to Section 6.1(d)(i) or 6.1(d)(ii)). The foregoing definition of
         Adjusted Capital Account is intended to comply with the provisions of
         Treasury Regulation Section 1.704-1(b)(2)(ii)(d) and shall be
         interpreted consistently therewith. The "Adjusted Capital Account" of a
         Partner in respect of a General Partner Interest or any other specified
         interest in the Partnership shall be the amount that such Adjusted
         Capital Account would be if such General Partner Interest or other
         interest in the Partnership were the only interest in the Partnership
         held by such Partner from and after the date on which such General
         Partner Interest or other interest in the Partnership was first issued.




                                       1
<PAGE>

                  "Adjusted Property" means any property the Carrying Value of
         which has been adjusted pursuant to Section 5.5(d)(i) or 5.5(d)(ii).

                  "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. As used herein, the term "control" means the possession,
         direct or indirect, of the power to direct or cause the direction of
         the management and policies of a Person, whether through ownership of
         voting securities, by contract or otherwise.

                  "Agreed Allocation" means any allocation, other than a
         Required Allocation, of an item of income, gain, loss or deduction
         pursuant to the provisions of Section 6.1, including, without
         limitation, a Curative Allocation (if appropriate to the context in
         which the term "Agreed Allocation" is used).

                  "Agreed Value" of any Contributed Property means the fair
         market value of such property or other consideration at the time of
         contribution as determined by the General Partner using such reasonable
         method of valuation as it may adopt. The General Partner shall, in its
         discretion, use such method as it deems reasonable and appropriate to
         allocate the aggregate Agreed Value of Contributed Properties
         contributed to the Partnership in a single or integrated transaction
         among each separate property on a basis proportional to the fair market
         value of each Contributed Property.

                  "Agreement" means this Amended and Restated Agreement of
         Limited Partnership of Martin Operating Partnership L.P., as it may be
         amended, supplemented or restated from time to time.

                  "Assets" means all assets conveyed, contributed or otherwise
         transferred, including any transfers of assets pursuant to the mergers
         set forth in the Contribution Agreement, to the Partnership Group prior
         to or on the Closing Date pursuant to the Contribution Agreement.

                  "Assignee" means a Person to whom one or more Limited Partner
         Interests have been transferred in a manner permitted under this
         Agreement, but who has not been admitted as a Substituted Limited
         Partner.

                  "Associate" means, when used to indicate a relationship with
         any Person, (a) any corporation or organization of which such Person is
         a director, officer or partner or is, directly or indirectly, the owner
         of 20% or more of any class of voting stock or other voting interest;
         (b) any trust or other estate in which such Person has at least a 20%
         beneficial interest or as to which such Person serves as trustee or in
         a similar fiduciary capacity; and (c) any relative or spouse of such
         Person, or any relative of such spouse, who has the same principal
         residence as such Person.

                  "Available Cash" means, with respect to any Quarter ending
         prior to the Liquidation Date:



                                       2
<PAGE>

                           (a) the sum of (i) all cash and cash equivalents of
         the Partnership on hand at the end of such Quarter, and (ii) all
         additional cash and cash equivalents of the Partnership on hand on the
         date of determination of Available Cash with respect to such Quarter
         resulting from Working Capital Borrowings made subsequent to the end of
         such Quarter, less

                           (b) the amount of any cash reserves that is necessary
         or appropriate in the reasonable discretion of the General Partner to
         (i) provide for the proper conduct of the business of the Partnership
         (including reserves for future capital expenditures and for anticipated
         future credit needs of the Partnership) subsequent to such Quarter,
         (ii) comply with applicable law or any loan agreement, security
         agreement, mortgage, debt instrument or other agreement or obligation
         to which any Group Member is a party or by which it is bound or its
         assets are subject or (iii) provide funds for distributions under
         Section 6.4 or 6.5 of the MLP Agreement in respect of any one or more
         of the next four Quarters; provided, however, that the General Partner
         may not establish cash reserves pursuant to (iii) above if the effect
         of such reserves would be that the MLP is unable to distribute the
         Minimum Quarterly Distribution on all Common Units, plus any Cumulative
         Common Unit Arrearage on all Common Units, with respect to such
         Quarter; and, provided further, that disbursements made by a Group
         Member or cash reserves established, increased or reduced after the end
         of such Quarter but on or before the date of determination of Available
         Cash with respect to such Quarter shall be deemed to have been made,
         established, increased or reduced, for purposes of determining
         Available Cash, within such Quarter if the General Partner so
         determines.

                  Notwithstanding the foregoing, "Available Cash" with respect
         to the Quarter in which the Liquidation Date occurs and any subsequent
         Quarter shall equal zero.

                  "Book-Tax Disparity" means with respect to any item of
         Contributed Property or Adjusted Property, as of the date of any
         determination, the difference between the Carrying Value of such
         Contributed Property or Adjusted Property and the adjusted basis
         thereof for federal income tax purposes as of such date. A Partner's
         share of the Partnership's Book-Tax Disparities in all of its
         Contributed Property and Adjusted Property will be reflected by the
         difference between such Partner's Capital Account balance as maintained
         pursuant to Section 5.5 and the hypothetical balance of such Partner's
         Capital Account computed as if it had been maintained strictly in
         accordance with federal income tax accounting principles.

                  "Capital Account" means the capital account maintained for a
         Partner pursuant to Section 5.5. The "Capital Account" of a Partner in
         respect of a General Partner Interest or any other Partnership Interest
         shall be the amount that such Capital Account would be if such General
         Partner Interest or other specified interest in the Partnership were
         the only interest in the Partnership held by such Partner from and
         after the date on which such General Partner Interest or other
         specified interest in the Partnership was first issued.



                                       3
<PAGE>

                  "Capital Contribution" means any cash, cash equivalents or the
         Net Agreed Value of Contributed Property that a Partner contributes to
         the Partnership pursuant to this Agreement or the Contribution
         Agreement.

                  "Carrying Value" means (a) with respect to a Contributed
         Property, the Agreed Value of such property reduced (but not below
         zero) by all depreciation, amortization and cost recovery deductions
         charged to the Partners' and Assignees' Capital Accounts in respect of
         such Contributed Property, and (b) with respect to any other
         Partnership property, the adjusted basis of such property for federal
         income tax purposes, all as of the time of determination. The Carrying
         Value of any property shall be adjusted from time to time in accordance
         with Sections 5.5(d)(i) and 5.5(d)(ii) and to reflect changes,
         additions or other adjustments to the Carrying Value for dispositions
         and acquisitions of Partnership properties, as deemed appropriate by
         the General Partner.

                  "Certificate of Limited Partnership" means the Certificate of
         Limited Partnership of the Partnership filed with the Secretary of
         State of the State of Delaware as referenced in Section 7.2, as such
         Certificate of Limited Partnership may be amended, supplemented or
         restated from time to time.

                  "Closing Date" means the first date on which Common Units are
         sold by the MLP to the Underwriters pursuant to the provisions of the
         Underwriting Agreement.

                  "Code" means the Internal Revenue Code of 1986, as amended and
         in effect from time to time. Any reference herein to a specific section
         or sections of the Code shall be deemed to include a reference to any
         corresponding provision of any successor law.

                  "Commission" means the United States Securities and Exchange
         Commission.

                  "Contributed Property" means each property or other asset, in
         such form as may be permitted by the Delaware Act, but excluding cash,
         contributed to the Partnership. Once the Carrying Value of a
         Contributed Property is adjusted pursuant to Section 5.5(d), such
         property shall no longer constitute a Contributed Property, but shall
         be deemed an Adjusted Property.

                  "Contribution Agreement" means that certain Contribution,
         Conveyance and Assumption Agreement, dated as of October 31, 2002,
         among the Partnership, the General Partner, the MLP General Partner,
         the MLP, Martin Resource Management Corporation, certain other
         Subsidiaries of Martin Resource Management Corporation, Martin Resource
         LLC, and certain other subsidiaries of Martin Resource LLC, together
         with the additional conveyance documents and instruments contemplated
         or referenced thereunder.

                  "Curative Allocation" means any allocation of an item of
         income, gain, deduction, loss or credit pursuant to the provisions of
         Section 6.1(d)(ix).



                                       4
<PAGE>

                  "Delaware Act" means the Delaware Revised Uniform Limited
         Partnership Act, 6 Del. C. Section 17-101 et seq., as amended,
         supplemented or restated from time to time, and any successor to such
         statute.

                  "Departing Partner" means a former General Partner from and
         after the effective date of any withdrawal or removal of such former
         General Partner pursuant to Section 11.1 or 11.2.

                  "Economic Risk of Loss" has the meaning set forth in Treasury
         Regulation Section 1.752-2(a).

                  "Event of Withdrawal" has the meaning assigned to such term in
         Section 11.1(a).

                  "General Partner" means Martin Operating GP LLC and its
         successors and permitted assigns as general partner of the Partnership.

                  "General Partner Interest" means the ownership interest of the
         General Partner in the Partnership (in its capacity as a general
         partner) and includes any and all benefits to which the General Partner
         is entitled as provided in this Agreement, together with all
         obligations of the General Partner to comply with the terms and
         provisions of this Agreement.

                  "Group Member" means a member of the Partnership Group.

                  "Indemnitee" means (a) the General Partner, (b) any Departing
         Partner, (c) any Person who is or was an Affiliate of the General
         Partner or any Departing Partner, (d) any Person who is or was a
         member, partner, officer, director, employee, agent or trustee of any
         Group Member, the General Partner or any Departing Partner or any
         Affiliate of any Group Member, the General Partner or any Departing
         Partner, and (e) any Person who is or was serving at the request of the
         General Partner or any Departing Partner or any Affiliate of the
         General Partner or any Departing Partner as an officer, director,
         employee, member, partner, agent, fiduciary or trustee of another
         Person; provided, that a Person shall not be an Indemnitee by reason of
         providing, on a fee-for-services basis, trustee, fiduciary or custodial
         services.

                  "Initial Offering" means the initial offering and sale of
         Common Units to the public, as described in the Registration Statement.

                  "Limited Partner" means any Person that is admitted to the
         Partnership as a limited partner pursuant to the terms and conditions
         of this Agreement; but the term "Limited Partner" shall not include any
         Person from and after the time such Person withdraws as a Limited
         Partner from the Partnership.

                  "Limited Partner Interest" means the ownership interest of a
         Limited Partner or Assignee in the Partnership and includes any and all
         benefits to which such Limited Partner or Assignee is entitled as
         provided in this Agreement, together with all




                                       5
<PAGE>

         obligations of such Limited Partner or Assignee to comply with the
         terms and provisions of this Agreement.

                  "Liquidation Date" means (a) in the case of an event giving
         rise to the dissolution of the Partnership of the type described in
         clauses (a) and (b) of the first sentence of Section 12.2, the date on
         which the applicable time period during which the Partners have the
         right to elect to reconstitute the Partnership and continue its
         business has expired without such an election being made, and (b) in
         the case of any other event giving rise to the dissolution of the
         Partnership, the date on which such event occurs.

                  "Liquidator" means one or more Persons selected by the General
         Partner to perform the functions described in Section 12.3 as
         liquidating trustee of the Partnership within the meaning of the
         Delaware Act.

                  "Merger Agreement" has the meaning assigned to such term in
         Section 14.1.

                  "MLP" means Martin Midstream Partners L.P., a Delaware limited
         partnership.

                  "MLP Agreement" means the Agreement of Limited Partnership of
         Martin Midstream Partners L.P., as it may be amended, supplemented or
         restated from time to time.

                  "MLP General Partner" means Martin Midstream GP LLC, a
         Delaware limited liability company and the general partner of the MLP.

                  "Net Agreed Value" means, (a) in the case of any Contributed
         Property, the Agreed Value of such property reduced by any liabilities
         either assumed by the Partnership upon such contribution or to which
         such property is subject when contributed, and (b) in the case of any
         property distributed to a Partner or Assignee by the Partnership, the
         Partnership's Carrying Value of such property (as adjusted pursuant to
         Section 5.5(d)(ii)) at the time such property is distributed, reduced
         by any indebtedness either assumed by such Partner or Assignee upon
         such distribution or to which such property is subject at the time of
         distribution, in either case, as determined under Section 752 of the
         Code.

                  "Net Income" means, for any taxable year, the excess, if any,
         of the Partnership's items of income and gain (other than those items
         taken into account in the computation of Net Termination Gain or Net
         Termination Loss) for such taxable year over the Partnership's items of
         loss and deduction (other than those items taken into account in the
         computation of Net Termination Gain or Net Termination Loss) for such
         taxable year. The items included in the calculation of Net Income shall
         be determined in accordance with Section 5.5(b) and shall not include
         any items specially allocated under Section 6.1(d).

                  "Net Loss" means, for any taxable year, the excess, if any, of
         the Partnership's items of loss and deduction (other than those items
         taken into account in the computation




                                       6
<PAGE>

         of Net Termination Gain or Net Termination Loss) for such taxable year
         over the Partnership's items of income and gain (other than those
         items taken into account in the computation of Net Termination Gain or
         Net Termination Loss) for such taxable year. The items included in the
         calculation of Net Loss shall be determined in accordance with Section
         5.5(b) and shall not include any items specially allocated under
         Section 6.1(d).

                  "Net Termination Gain" means, for any taxable year, the sum,
         if positive, of all items of income, gain, loss or deduction recognized
         by the Partnership after the Liquidation Date. The items included in
         the determination of Net Termination Gain shall be determined in
         accordance with Section 5.5(b) and shall not include any items of
         income, gain or loss specially allocated under Section 6.1(d).

                  "Net Termination Loss" means, for any taxable year, the sum,
         if negative, of all items of income, gain, loss or deduction recognized
         by the Partnership after the Liquidation Date. The items included in
         the determination of Net Termination Loss shall be determined in
         accordance with Section 5.5(b) and shall not include any items of
         income, gain or loss specially allocated under Section 6.1(d).

                  "Nonrecourse Built-in Gain" means with respect to any
         Contributed Properties or Adjusted Properties that are subject to a
         mortgage or pledge securing a Nonrecourse Liability, the amount of any
         taxable gain that would be allocated to the Partners pursuant to
         Sections 6.2(b)(i)(A), 6.2(b)(ii)(A) and 6.2(b)(iii) if such properties
         were disposed of in a taxable transaction in full satisfaction of such
         liabilities and for no other consideration.

                  "Nonrecourse Deductions" means any and all items of loss,
         deduction or expenditure (including, without limitation, any
         expenditure described in Section 705(a)(2)(B) of the Code) that, in
         accordance with the principles of Treasury Regulation Section
         1.704-2(b), are attributable to a Nonrecourse Liability.

                  "Nonrecourse Liability" has the meaning set forth in Treasury
         Regulation Section 1.752-1(a)(2).

                  "OLP Subsidiary" means a Subsidiary of the Partnership.

                  "Omnibus Agreement" means that Omnibus Agreement, dated as
         November 1, 2002, among the Partnership, Martin Resource Management
         Corporation, the MLP General Partner and the MLP.

                  "Opinion of Counsel" means a written opinion of counsel (who
         may be regular counsel to the Partnership or the General Partner or any
         of its Affiliates) acceptable to the General Partner in its reasonable
         discretion.

                  "Partner Nonrecourse Debt" has the meaning set forth in
         Treasury Regulation Section 1.704-2(b)(4).



                                       7
<PAGE>

                  "Partner Nonrecourse Debt Minimum Gain" has the meaning set
         forth in Treasury Regulation Section 1.704-2(i)(2).

                  "Partner Nonrecourse Deductions" means any and all items of
         loss, deduction or expenditure (including, without limitation, any
         expenditure described in Section 705(a)(2)(B) of the Code) that, in
         accordance with the principles of Treasury Regulation Section
         1.704-2(i), are attributable to a Partner Nonrecourse Debt.

                  "Partners" means the General Partner and the Limited Partners.

                  "Partnership" means Martin Operating Partnership L.P., a
         Delaware limited partnership, and any successors thereto.

                  "Partnership Group" means the Partnership and all OLP
         Subsidiaries, treated as a single consolidated entity.

                  "Partnership Interest" means an ownership interest of a
         Partner in the Partnership, which shall include the General Partner
         Interest and the Limited Partner Interest(s).

                  "Partnership Minimum Gain" means that amount determined in
         accordance with the principles of Treasury Regulation Section
         1.704-2(d).

                  "Partnership Security" means any class or series of equity
         interest in the Partnership (but excluding any options, rights,
         warrants and appreciation rights relating to an equity interest in the
         Partnership).

                  "Percentage Interest" means the percentage interest in the
         Partnership owned by each Partner upon completion of the transactions
         in Section 5.2 and shall mean, (a) as to the General Partner, 0.1% and
         (b) as to the MLP, 99.9%.

                  "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.

                  "Quarter" means, unless the context requires otherwise, a
         fiscal quarter (or, with respect to the fiscal quarter during which the
         Closing Date occurs, the portion of such fiscal quarter remaining after
         the Closing Date) of the Partnership.

                  "Recapture Income" means any gain recognized by the
         Partnership (computed without regard to any adjustment required by
         Section 734 or Section 743 of the Code) upon the disposition of any
         property or asset of the Partnership, which gain is characterized as
         ordinary income because it represents the recapture of deductions
         previously taken with respect to such property or asset.



                                       8
<PAGE>

                  "Registration Statement" means the Registration Statement on
         Form S-1 (Registration No. 333-91706) as it has been or as it may be
         amended or supplemented from time to time, filed by the MLP with the
         Commission under the Securities Act to register the offering and sale
         of the Common Units in the Initial Offering.

                  "Required Allocations" means (a) any limitation imposed on any
         allocation of Net Losses or Net Termination Losses under Section 6.1(b)
         or 6.1(c)(ii) and (b) any allocation of an item of income, gain, loss
         or deduction pursuant to Section 6.1(d)(i), 6.1(d)(ii), 6.1(d)(iv),
         6.1(d)(vii) or 6.1(d)(ix).

                  "Residual Gain" or "Residual Loss" means any item of gain or
         loss, as the case may be, of the Partnership recognized for federal
         income tax purposes resulting from a sale, exchange or other
         disposition of a Contributed Property or an Adjusted Property, to the
         extent such item of gain or loss is not allocated pursuant to Section
         6.2(b)(i)(A) or 6.2(b)(ii)(A), respectively, to eliminate Book-Tax
         Disparities.

                  "Securities Act" means the Securities Act of 1933, as amended,
         supplemented or restated from time to time and any successor to such
         statute.

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

                  "Substituted Limited Partner" means a Person who is admitted
         as a Limited Partner to the Partnership pursuant to Section 10.2 in
         place of and with all the rights of a Limited Partner and who is shown
         as a Limited Partner on the books and records of the Partnership.

                  "Surviving Business Entity" has the meaning assigned to such
         term in Section 14.2(b).

                  "transfer" has the meaning assigned to such term in Section
         4.1(a).



                                       9
<PAGE>

                  "Underwriter" means each Person named as an underwriter in
         Schedule I to the Underwriting Agreement who purchases Common Units
         pursuant thereto.

                  "Underwriting Agreement" means the Underwriting Agreement,
         dated October 31, 2002, among the Underwriters, the MLP, the MLP
         General Partner, the Partnership and Martin Resource Management
         Corporation, and certain Affiliates, providing for the purchase of
         Common Units by such Underwriters.

                  "Unrealized Gain" attributable to any item of Partnership
         property means, as of any date of determination, the excess, if any, of
         (a) the fair market value of such property as of such date (as
         determined under Section 5.5(d)) over (b) the Carrying Value of such
         property as of such date (prior to any adjustment to be made pursuant
         to Section 5.5(d) as of such date).

                  "Unrealized Loss" attributable to any item of Partnership
         property means, as of any date of determination, the excess, if any, of
         (a) the Carrying Value of such property as of such date (prior to any
         adjustment to be made pursuant to Section 5.5(d) as of such date) over
         (b) the fair market value of such property as of such date (as
         determined under Section 5.5(d)).

                  "U.S. GAAP" means United States Generally Accepted Accounting
         Principles consistently applied.

                  "Withdrawal Opinion of Counsel" has the meaning assigned to
         such term in Section 11.1(b).

                  "Working Capital Borrowings" means borrowings used solely for
         working capital purposes or to pay distributions to Partners made
         pursuant to a credit facility or other arrangement to the extent such
         borrowings are required to be reduced to a relatively small amount each
         year (or for the year in which the Initial Offering is consummated, the
         12-month period beginning on the Closing Date) for an economically
         meaningful period of time.

                  Section 1.2 Construction. Unless the context requires
otherwise: (a) any pronoun used in this Agreement shall include the
corresponding masculine, feminine or neuter forms, and the singular form of
nouns, pronouns and verbs shall include the plural and vice versa; (b)
references to Articles and Sections refer to Articles and Sections of this
Agreement; and (c) the term "include" or "includes" means includes, without
limitation, and "including" means including, without limitation.


                                   ARTICLE II
                                  ORGANIZATION

                  Section 2.1 Formation. Except as expressly provided to the
contrary in this Agreement, the rights, duties (including fiduciary duties),
liabilities and obligations of the





                                       10
<PAGE>

Partners and the administration, dissolution and termination of the Partnership
shall be governed by the Delaware Act. All Partnership Interests shall
constitute personal property of the owner thereof for all purposes and a Partner
has no interest in specific Partnership property.

                  Section 2.2 Name. The name of the Partnership shall be "Martin
Operating Partnership L.P." The Partnership's business may be conducted under
any other name or names deemed necessary or appropriate by the General Partner
in its sole discretion, including the name of the General Partner. The words
"Limited Partnership," "L.P.," "Ltd." or similar words or letters shall be
included in the Partnership's name where necessary for the purpose of complying
with the laws of any jurisdiction that so requires. The General Partner in its
discretion may change the name of the Partnership at any time and from time to
time and shall notify the Limited Partners of such change in the next regular
communication to the Limited Partners.

                  Section 2.3 Registered Office; Registered Agent; Principal
Office; Other Offices. Unless and until changed by the General Partner, the
registered office of the Partnership in the State of Delaware shall be located
at 1209 Orange Street, Wilmington, Delaware 19801, and the registered agent for
service of process on the Partnership in the State of Delaware at such
registered office shall be The Corporation Trust Company. The principal office
of the Partnership shall be located at 4200 Stone Road, Kilgore, Texas 75662, or
such other place as the General Partner may from time to time designate by
notice to the Limited Partners. The Partnership may maintain offices at such
other place or places within or outside the State of Delaware as the General
Partner deems necessary or appropriate. The address of the General Partner shall
be 4200 Stone Road, Kilgore, Texas 75662, or such other place as the General
Partner may from time to time designate by notice to the Limited Partners.

                  Section 2.4 Purpose and Business. The purpose and nature of
the business to be conducted by the Partnership shall be to (a) acquire, manage,
operate and sell the Assets and any similar assets or properties now or
hereafter acquired by the Partnership, (b) engage directly in, or enter into or
form any corporation, partnership, joint venture, limited liability company or
other arrangement to engage indirectly in, any business activity that the
Partnership is permitted to engage in, or any type of business or activity
engaged in by the General Partner prior to the Closing Date and, in connection
therewith, to exercise all of the rights and powers conferred upon the
Partnership pursuant to the agreements relating to such business activity, (c)
engage directly in, or enter into or form any corporation, partnership, joint
venture, limited liability company or other arrangement to engage indirectly in,
any business activity that is approved by the General Partner and that lawfully
may be conducted by a limited partnership organized pursuant to the Delaware Act
and, in connection therewith, to exercise all of the rights and powers conferred
upon the Partnership pursuant to the agreements relating to such business
activity; provided, however, that the General Partner reasonably determines, as
of the date of the acquisition or commencement of such activity, that such
activity (i) generates "qualifying income" (as such term is defined pursuant to
Section 7704 of the Code) or (ii) enhances the operations of an activity of the
Partnership that generates qualifying income, and (d) do anything necessary or
appropriate to the foregoing, including the making of capital contributions or
loans to a Group Member, the MLP or any Subsidiary of the MLP. The General
Partner has no obligation or duty to the Partnership, the Limited Partners or
the Assignees to propose or approve, and in its discretion may decline to
propose or approve, the conduct by the Partnership of any business.



                                       11
<PAGE>

                  Section 2.5 Powers. The Partnership shall be empowered to do
any and all acts and things necessary, appropriate, proper, advisable,
incidental to or convenient for the furtherance and accomplishment of the
purposes and business described in Section 2.4 and for the protection and
benefit of the Partnership.

                  Section 2.6 Power of Attorney.

                  (a) Each Limited Partner and each Assignee hereby constitutes
and appoints the General Partner and, if a Liquidator shall have been selected
pursuant to Section 12.3, the Liquidator (and any successor to the Liquidator by
merger, transfer, assignment, election or otherwise) and each of their
authorized officers and attorneys-in-fact, as the case may be, with full power
of substitution, as its true and lawful agent and attorney-in-fact, with full
power and authority in his name, place and stead, to:


                      (i) execute, swear to, acknowledge, deliver, file and
         record in the appropriate public offices (A) all certificates,
         documents and other instruments (including this Agreement and the
         Certificate of Limited Partnership and all amendments or restatements
         hereof or thereof) that the General Partner or the Liquidator deems
         necessary or appropriate to form, qualify or continue the existence or
         qualification of the Partnership as a limited partnership (or a
         partnership in which the limited partners have limited liability) in
         the State of Delaware and in all other jurisdictions in which the
         Partnership may conduct business or own property; (B) all certificates,
         documents and other instruments that the General Partner or the
         Liquidator deems necessary or appropriate to reflect, in accordance
         with its terms, any amendment, change, modification or restatement of
         this Agreement; (C) all certificates, documents and other instruments
         (including conveyances and a certificate of cancellation) that the
         General Partner or the Liquidator deems necessary or appropriate to
         reflect the dissolution and liquidation of the Partnership pursuant to
         the terms of this Agreement; (D) all certificates, documents and other
         instruments relating to the admission, withdrawal, removal or
         substitution of any Partner pursuant to, or other events described in,
         Article IV, X, XI or XII; (E) all certificates, documents and other
         instruments relating to the determination of the rights, preferences
         and privileges of any class or series of Partnership Interests issued
         pursuant hereto; and (F) all certificates, documents and other
         instruments (including agreements and a certificate of merger) relating
         to a merger or consolidation of the Partnership pursuant to Article
         XIV; and

                      (ii) execute, swear to, acknowledge, deliver, file and
         record all ballots, consents, approvals, waivers, certificates,
         documents and other instruments necessary or appropriate, in the
         discretion of the General Partner or the Liquidator, to make, evidence,
         give, confirm or ratify any vote, consent, approval, agreement or other
         action that is made or given by the Partners hereunder or is consistent
         with the terms of this Agreement or is necessary or appropriate, in the
         discretion of the General Partner or the Liquidator, to effectuate the
         terms or intent of this Agreement; provided, that when required by any
         provision of this Agreement that establishes a percentage of the
         Limited Partners or of the Limited Partners of any class or series
         required to take any action, the General Partner and the Liquidator may
         exercise the power of attorney made in this Section 2.6(a)(ii) only




                                       12
<PAGE>

         after the necessary vote, consent or approval of the Limited Partners
         or of the Limited Partners of such class or series, as applicable.

                  Nothing contained in this Section 2.6(a) shall be construed as
authorizing the General Partner to amend this Agreement except in accordance
with Article XIII or as may be otherwise expressly provided for in this
Agreement.

                  (b) The foregoing power of attorney is hereby declared to be
irrevocable and a power coupled with an interest, and it shall survive and, to
the maximum extent permitted by law, not be affected by the subsequent death,
incompetency, disability, incapacity, dissolution, bankruptcy or termination of
any Limited Partner or Assignee and the transfer of all or any portion of such
Limited Partner's or Assignee's Partnership Interest and shall extend to such
Limited Partner's or Assignee's heirs, successors, assigns and personal
representatives. Each such Limited Partner or Assignee hereby agrees to be bound
by any representation made by the General Partner or the Liquidator acting in
good faith pursuant to such power of attorney; and each such Limited Partner or
Assignee, to the maximum extent permitted by law, hereby waives any and all
defenses that may be available to contest, negate or disaffirm the action of the
General Partner or the Liquidator taken in good faith under such power of
attorney. Each Limited Partner or Assignee shall execute and deliver to the
General Partner or the Liquidator, within 15 days after receipt of the request
therefor, such further designation, powers of attorney and other instruments as
the General Partner or the Liquidator deems necessary to effectuate this
Agreement and the purposes of the Partnership.

                  Section 2.7 Term. The term of the Partnership commenced upon
the filing of the Certificate of Limited Partnership in accordance with the
Delaware Act and shall continue in existence until the dissolution of the
Partnership in accordance with the provisions of Article XII. The existence of
the Partnership as a separate legal entity shall continue until the cancellation
of the Certificate of Limited Partnership as provided in the Delaware Act.

                  Section 2.8 Title to Partnership Assets. Title to Partnership
assets, whether real, personal or mixed and whether tangible or intangible,
shall be deemed to be owned by the Partnership as an entity, and no Partner or
Assignee, individually or collectively, shall have any ownership interest in
such Partnership assets or any portion thereof. Title to any or all of the
Partnership assets may be held in the name of the Partnership, the General
Partner, one or more of its Affiliates or one or more nominees, as the General
Partner may determine. The General Partner hereby declares and warrants that any
Partnership assets for which record title is held in the name of the General
Partner or one or more of its Affiliates or one or more nominees shall be held
by the General Partner or such Affiliate or nominee for the use and benefit of
the Partnership in accordance with the provisions of this Agreement; provided,
however, that the General Partner shall use reasonable efforts to cause record
title to such assets (other than those assets in respect of which the General
Partner determines that the expense and difficulty of conveyancing makes
transfer of record title to the Partnership impracticable) to be vested in the
Partnership as soon as reasonably practicable; provided, further, that, prior to
any withdrawal or removal of the General Partner or as soon thereafter as
practicable, the General Partner shall use reasonable efforts to effect the
transfer of record title to the Partnership and, prior to any such transfer,
will provide for the use of such assets in a manner satisfactory to the General
Partner.




                                       13
<PAGE>

All Partnership assets shall be recorded as the property of the Partnership in
its books and records, irrespective of the name in which record title to such
Partnership assets is held.

                                  ARTICLE III
                           RIGHTS OF LIMITED PARTNERS

                  Section 3.1 Limitation of Liability. The Limited Partners and
the Assignees shall have no liability under this Agreement except as expressly
provided in this Agreement or the Delaware Act.

                  Section 3.2 Management of Business. No Limited Partner or
Assignee, in its capacity as such, shall participate in the operation,
management or control (within the meaning of the Delaware Act) of the
Partnership's business, transact any business in the Partnership's name or have
the power to sign documents for or otherwise bind the Partnership. Any action
taken by any Affiliate of the General Partner or any officer, director,
employee, manager, member, general partner, agent or trustee of the General
Partner or any of its Affiliates, or any officer, director, employee, manager,
member, general partner, agent or trustee of a Group Member, in its capacity as
such, shall not be deemed to be participation in the control of the business of
the Partnership by a limited partner of the Partnership (within the meaning of
Section 17-303(a) of the Delaware Act) and shall not affect, impair or eliminate
the limitations on the liability of the Limited Partners or Assignees under this
Agreement.

                  Section 3.3 Outside Activities of the Limited Partners.
Subject to the provisions of Article II and the Omnibus Agreement, which shall
continue to be applicable to the Persons referred to therein, regardless of
whether such Persons shall also be Limited Partners or Assignees, any Limited
Partner or Assignee shall be entitled to and may have business interests and
engage in business activities in addition to those relating to the Partnership,
including business interests and activities in direct competition with the
Partnership Group. Neither the Partnership nor any of the other Partners or
Assignees shall have any rights by virtue of this Agreement in any business
ventures of any Limited Partner or Assignee.

                  Section 3.4 Rights of Limited Partners.

                  (a) In addition to other rights provided by this Agreement or
by applicable law, and except as limited by Section 3.4(b), each Limited Partner
shall have the right, for a purpose reasonably related to such Limited Partner's
interest as a limited partner in the Partnership, upon reasonable written demand
and at such Limited Partner's own expense:

                      (i) promptly after becoming available, to obtain a copy of
         the Partnership's federal, state and local income tax returns for each
         year;

                      (ii) to have furnished to him a current list of the name
         and last known business, residence or mailing address of each Partner;

                      (iii) to have furnished to him a copy of this Agreement
         and the Certificate of Limited Partnership and all amendments thereto,
         together with a copy of





                                       14
<PAGE>

         the executed copies of all powers of attorney pursuant to which this
         Agreement, the Certificate of Limited Partnership and all amendments
         thereto have been executed;

                      (iv) to obtain true and full information regarding the
         amount of cash and a description and statement of the Net Agreed Value
         of any other Capital Contribution by each Partner and that each Partner
         has agreed to contribute in the future, and the date on which each
         became a Partner; and

                      (v) to obtain such other information regarding the affairs
         of the Partnership as is just and reasonable; and

                      (vi) to obtain true and full information regarding the
         status of the business and financial condition of the Partnership.

                  (b) The General Partner may keep confidential from the Limited
Partners and Assignees, for such period of time as the General Partner deems
reasonable, (i) any information that the General Partner reasonably believes to
be in the nature of trade secrets or (ii) other information the disclosure of
which the General Partner in good faith believes (A) is not in the best
interests of the MLP or the Partnership Group, (B) could damage the MLP or the
Partnership Group or (C) that any Group Member is required by law or by
agreement with any third party to keep confidential (other than agreements with
Affiliates of the Partnership the primary purpose of which is to circumvent the
obligations set forth in this Section 3.4).

                                   ARTICLE IV
                       TRANSFERS OF PARTNERSHIP INTERESTS

                  Section 4.1 Transfer Generally.

                  (a) The term "transfer," when used in this Agreement with
respect to a Partnership Interest, shall be deemed to refer to a transaction by
which a General Partner assigns its General Partner Interest to another Person
who becomes the General Partner or by which the holder of a Limited Partner
Interest assigns such Limited Partner Interest to another Person who is or
becomes a Limited Partner (or an Assignee), and includes a sale, assignment,
gift, pledge, encumbrance, hypothecation, mortgage, exchange or any other
disposition by law or otherwise.

                  (b) No Partnership Interest shall be transferred, in whole or
in part, except in accordance with the terms and conditions set forth in this
Article IV. Any transfer or purported transfer of a Partnership Interest not
made in accordance with this Article IV shall be null and void.

                  (c) Nothing contained in this Agreement shall be construed to
prevent a disposition by any member of the General Partner of any or all of the
issued and outstanding member interests of the General Partner.

                  Section 4.2 Transfer of General Partner's General Partner
Interest. No provision of this Agreement shall be construed to prevent (and the
Limited Partners do hereby expressly consent to) (i) the transfer by the General
Partner of all or a portion of its General


                                       15
<PAGE>

Partner Interest to one or more Affiliates, which transferred General Partner
Interest, to the extent not transferred to a successor General Partner, shall
constitute a Limited Partner Interest or (ii) the transfer by the General
Partner, in whole and not in part, of its General Partner Interest upon (a) its
merger, consolidation or other combination into any other Person or the transfer
by it of all or substantially all of its assets to another Person or (b) sale of
all or substantially all of the membership interests of the General Partner by
its members if, in the case of a transfer described in either clause (i) or (ii)
of this sentence, the rights and duties of the General Partner with respect to
the General Partner Interest so transferred are assumed by the transferee and
the transferee agrees to be bound by the provisions of this Agreement; provided,
however, that in either such case, the transferee is primarily controlled,
directly or indirectly, by the MLP or the MLP General Partner or any Person
primarily controlling, directly or indirectly, the MLP or the MLP General
Partner; provided, further, that in either such case, such transferee furnishes
to the Partnership an Opinion of Counsel that such merger, consolidation,
combination, transfer or assumption will not result in a loss of limited
liability of any Limited Partner or cause the Partnership to be taxable as a
corporation or otherwise to be taxed as an entity for federal income tax
purposes (to the extent not already so treated or taxed). In the case of a
transfer pursuant to this Section 4.2 to a Person proposed as a successor
general partner of the Partnership, the transferee or successor (as the case may
be) shall, subject to compliance with the terms of Section 10.4, be admitted to
the Partnership as the General Partner immediately prior to the transfer of the
Partnership Interest, and the business of the Partnership shall continue without
dissolution.

                  Section 4.3 Transfer of a Limited Partner's Partnership
Interest. A Limited Partner may transfer all, but not less than all, of its
Partnership Interest as a Limited Partner in connection with the merger,
consolidation or other combination of such Limited Partner with or into any
other Person or the transfer by such Limited Partner of all or substantially all
of its assets to another Person and, following any such transfer, such Person
may become a Substituted Limited Partner pursuant to Article X. Except as set
forth in the immediately preceding sentence, or in connection with any pledge of
(or any related foreclosure on) a Partnership Interest of a Limited Partner
solely for the purpose of securing, directly or indirectly, indebtedness of the
Partnership or the MLP, a Limited Partner may not transfer all or any part of
its Partnership Interest or withdraw from the Partnership.

                  Section 4.4 Restrictions on Transfers.

                  (a) Notwithstanding the other provisions of this Article IV,
no transfer of any Partnership Interest shall be made if such transfer would (i)
violate the then applicable federal or state securities laws or the rules and
regulations of the Commission, any state securities commission or any other
governmental authority with jurisdiction over such transfer, (ii) terminate the
existence or qualification of the Partnership or the MLP under the laws of the
jurisdiction of its formation or (iii) cause the Partnership or the MLP to be
treated as an association taxable as a corporation or otherwise to be taxed as
an entity for federal income tax purposes (to the extent not already so treated
or taxed).

                  (b) The General Partner may impose restrictions on the
transfer of Partnership Interests if a subsequent Opinion of Counsel determines
that such restrictions are necessary to avoid a significant risk of the
Partnership or the MLP becoming taxable as a corporation or




                                       16
<PAGE>

otherwise to be taxed as an entity for federal income tax purposes. The
restrictions may be imposed by making such amendments to this Agreement as the
General Partner may determine to be necessary or appropriate to impose such
restrictions.

                                   ARTICLE V
           CAPITAL CONTRIBUTIONS AND ISSUANCE OF PARTNERSHIP INTERESTS

                  Section 5.1 Initial Contributions. In connection with the
initial formation of the Partnership under the Delaware Act, the General Partner
made an initial Capital Contribution to the Partnership in the amount of $1.00
in exchange for a 0.1% interest in the Partnership and was admitted as General
Partner, and Martin Resource LLC made an initial Capital Contribution to the
Partnership in the amount of $999 in exchange for a 99.9% interest (the "Initial
LP Interest") in the Partnership and was admitted as a Limited Partner.

                  Section 5.2 Contributions Pursuant to the Contribution
Agreement.

                  (a) Pursuant to the Contribution Agreement, Martin Resource
LLC , Martin Gas Sales LLC, and Midstream Fuel Service LLC contributed to the
Partnership all of their direct interests in the Assets pursuant to the
Contribution Agreement in exchange for Limited Partner Interests. Immediately
following such transfer, and the admission of Martin Resource LLC, Martin Gas
Sales LLC and Midstream Fuel Service LLC as Limited Partners, the Initial LP
Interest was redeemed by the Partnership for $999 in cash. Following these
transactions, these parties held a collective 99.9% Limited Partner Interest in
the Partnership.

                  (b) Pursuant to the Contribution Agreement, Martin Resource
LLC, Martin Gas Sales LLC and Midstream Fuel Service LLC transferred their
collective 99.9% Limited Partner Interest and the 0.1% General Partner Interest
to the MLP and the MLP General Partner in exchange for Subordinated Units (as
defined in the MLP Agreement) of the MLP. Pursuant to the Contribution
Agreement, the MLP General Partner transferred the Limited Partnership Interest
it received from Martin Resource Management Corporation and certain of its
Affiliates to the MLP in exchange for a continuation of its 2% general partner
interest in the MLP. The contribution by Martin Resource LLC of a portion of its
Limited Partner Interest occurred immediately prior to the other contributions
covered in this subsection (b) so that the MLP was admitted as a Limited Partner
of the Partnership prior to the withdrawal of Martin Resource LLC, Martin Gas
Sales LLC and Midstream Fuel Service LLC as Limited Partners of the Partnership.

                  (c) Following the foregoing transactions, the General Partner
owns a 0.1% Partnership Interest as General Partner and the MLP owns a 99.9%
Partnership Interest as a Limited Partner.

                  Section 5.3 Additional Capital Contributions. With the consent
of the General Partner, any Limited Partner may, but shall not be obligated to,
make additional Capital Contributions to the Partnership. Contemporaneously with
the making of any Capital Contributions by a Limited Partner, in addition to
those provided in Sections 5.1 and 5.2, the General Partner shall be obligated
to make an additional Capital Contribution to the Partnership in an amount equal
to 0.1 divided by 99.9 times the amount of the additional Capital




                                       17
<PAGE>

Contribution then made by such Limited Partner. Except as set forth in the
immediately preceding sentence and in Article XII, the General Partner shall not
be obligated to make any additional Capital Contributions to the Partnership.

                  Section 5.4 Interest and Withdrawal. No interest shall be paid
by the Partnership on Capital Contributions. No Partner or Assignee shall be
entitled to the withdrawal or return of its Capital Contribution, except to the
extent, if any, that distributions made pursuant to this Agreement or upon
termination of the Partnership may be considered as such by law and then only to
the extent provided for in this Agreement. Except to the extent expressly
provided in this Agreement, no Partner or Assignee shall have priority over any
other Partner or Assignee either as to the return of Capital Contributions or as
to profits, losses or distributions. Any such return shall be a compromise to
which all Partners and Assignees agree within the meaning of Section 17-502(b)
of the Delaware Act.

                  Section 5.5 Capital Accounts.

                  (a) The Partnership shall maintain for each Partner (or a
beneficial owner of Partnership Interests held by a nominee in any case in which
the nominee has furnished the identity of such owner to the Partnership in
accordance with Section 6031(c) of the Code or any other method acceptable to
the General Partner in its sole discretion) owning a Partnership Interest a
separate Capital Account with respect to such Partnership Interest in accordance
with the rules of Treasury Regulation Section 1.704-1(b)(2)(iv). Such Capital
Account shall be increased by (i) the amount of all Capital Contributions made
to the Partnership with respect to such Partnership Interest pursuant to this
Agreement and (ii) all items of Partnership income and gain (including, without
limitation, income and gain exempt from tax) computed in accordance with Section
5.5(b) and allocated with respect to such Partnership Interest pursuant to
Section 6.1, and decreased by (x) the amount of cash or Net Agreed Value of all
actual and deemed distributions of cash or property made with respect to such
Partnership Interest pursuant to this Agreement and (y) all items of Partnership
deduction and loss computed in accordance with Section 5.5(b) and allocated with
respect to such Partnership Interest pursuant to Section 6.1.

                  (b) For purposes of computing the amount of any item of
income, gain, loss or deduction that is to be allocated pursuant to Article VI
and is to be reflected in the Partners' Capital Accounts, the determination,
recognition and classification of any such item shall be the same as its
determination, recognition and classification for federal income tax purposes
(including, without limitation, any method of depreciation, cost recovery or
amortization used for that purpose), provided, that:

                      (i) Solely for purposes of this Section 5.5, the
         Partnership shall be treated as owning directly its proportionate share
         (as determined by the General Partner) of all property owned by any OLP
         Subsidiary that is classified as a partnership for federal income tax
         purposes.

                      (ii) All fees and other expenses incurred by the
         Partnership to promote the sale of (or to sell) a Partnership Interest
         that can neither be deducted nor amortized under Section 709 of the
         Code, if any, shall, for purposes of Capital Account





                                       18
<PAGE>

         maintenance, be treated as an item of deduction at the time such fees
         and other expenses are incurred and shall be allocated among the
         Partners pursuant to Section 6.1.

                      (iii) Except as otherwise provided in Treasury Regulation
         Section 1.704-1(b)(2)(iv)(m), computation of all items of income, gain,
         loss and deduction shall be made without regard to any election under
         Section 754 of the Code that may be made by the Partnership and, as to
         those items described in Section 705(a)(1)(B) or 705(a)(2)(B) of the
         Code, without regard to the fact that such items are not includable in
         gross income or are neither currently deductible nor capitalized for
         federal income tax purposes. To the extent an adjustment to the
         adjusted tax basis of any Partnership asset pursuant to Section 734(b)
         or 743(b) of the Code is required, pursuant to Treasury Regulation
         Section 1.704-1(b)(2)(iv)(m), to be taken into account in determining
         Capital Accounts, the amount of such adjustment in the Capital Accounts
         shall be treated as an item of gain or loss.

                      (iv) Any income, gain or loss attributable to the taxable
         disposition of any Partnership property shall be determined as if the
         adjusted basis of such property as of such date of disposition were
         equal in amount to the Partnership's Carrying Value with respect to
         such property as of such date.

                      (v) In accordance with the requirements of Section 704(b)
         of the Code, any deductions for depreciation, cost recovery or
         amortization attributable to any Contributed Property shall be
         determined as if the adjusted basis of such property on the date it was
         acquired by the Partnership were equal to the Agreed Value of such
         property. Upon an adjustment pursuant to Section 5.5(d) to the Carrying
         Value of any Partnership property subject to depreciation, cost
         recovery or amortization, any further deductions for such depreciation,
         cost recovery or amortization attributable to such property shall be
         determined (A) as if the adjusted basis of such property were equal to
         the Carrying Value of such property immediately following such
         adjustment and (B) using a rate of depreciation, cost recovery or
         amortization derived from the same method and useful life (or, if
         applicable, the remaining useful life) as is applied for federal income
         tax purposes; provided, however, that, if the asset has a zero adjusted
         basis for federal income tax purposes, depreciation, cost recovery or
         amortization deductions shall be determined using any reasonable method
         that the General Partner may adopt.

                      (vi) If the Partnership's adjusted basis in a depreciable
         or cost recovery property is reduced for federal income tax purposes
         pursuant to Section 48(q)(1) or 48(q)(3) of the Code, the amount of
         such reduction shall, solely for purposes hereof, be deemed to be an
         additional depreciation or cost recovery deduction in the year such
         property is placed in service and shall be allocated among the Partners
         pursuant to Section 6.1. Any restoration of such basis pursuant to
         Section 48(q)(2) of the Code shall, to the extent possible, be
         allocated in the same manner to the Partners to whom such deemed
         deduction was allocated.

                  (c) A transferee of a Partnership Interest shall succeed to a
pro rata portion of the Capital Account of the transferor relating to the
Partnership Interest so transferred.



                                       19
<PAGE>
                  (d) (i) In accordance with Treasury Regulation Section
         1.704-1(b)(2)(iv)(f), on an issuance of additional Partnership
         Interests for cash or Contributed Property, the Capital Accounts of all
         Partners and the Carrying Value of each Partnership property
         immediately prior to such issuance shall be adjusted upward or downward
         to reflect any Unrealized Gain or Unrealized Loss attributable to such
         Partnership property, as if such Unrealized Gain or Unrealized Loss had
         been recognized on an actual sale of each such property immediately
         prior to such issuance and had been allocated to the Partners at such
         time pursuant to Section 6.1 in the same manner as any item of gain or
         loss actually recognized during such period would have been allocated.
         In determining such Unrealized Gain or Unrealized Loss, the aggregate
         cash amount and fair market value of all Partnership assets (including,
         without limitation, cash or cash equivalents) immediately prior to the
         issuance of additional Partnership Interests shall be determined by the
         General Partner using such reasonable method of valuation as it may
         adopt; provided, however, that the General Partner, in arriving at such
         valuation, must take fully into account the fair market value of the
         Partnership Interests of all Partners at such time. The General Partner
         shall allocate such aggregate value among the assets of the Partnership
         (in such manner as it determines in its discretion to be reasonable) to
         arrive at a fair market value for individual properties.

                  (ii) In accordance with Treasury Regulation Section
         1.704-1(b)(2)(iv)(f), immediately prior to any actual or deemed
         distribution to a Partner of any Partnership property (other than a
         distribution of cash that is not in redemption or retirement of a
         Partnership Interest), the Capital Accounts of all Partners and the
         Carrying Value of all Partnership property shall be adjusted upward or
         downward to reflect any Unrealized Gain or Unrealized Loss attributable
         to such Partnership property, as if such Unrealized Gain or Unrealized
         Loss had been recognized in a sale of such property immediately prior
         to such distribution for an amount equal to its fair market value, and
         had been allocated to the Partners, at such time, pursuant to Section
         6.1(c) in the same manner as any item of gain or loss actually
         recognized during such period would have been allocated. In determining
         such Unrealized Gain or Unrealized Loss the aggregate cash amount and
         fair market value of all Partnership assets (including, without
         limitation, cash or cash equivalents) immediately prior to a
         distribution shall (A) in the case of an actual distribution that is
         not made pursuant to Section 12.4 or in the case of a deemed
         distribution, be determined and allocated in the same manner as that
         provided in Section 5.5(d)(i) or (B) in the case of a liquidating
         distribution pursuant to Section 12.4, be determined and allocated by
         the Liquidator using such reasonable method of valuation as it may
         adopt.

                  Section 5.6 Loans from Partners. Loans by a Partner to the
Partnership shall not constitute Capital Contributions. If any Partner shall
advance funds to the Partnership in excess of the amounts required hereunder to
be contributed by it to the capital of the Partnership, the making of such
excess advances shall not result in any increase in the amount of the Capital
Account of such Partner. The amount of any such excess advances shall be a debt
obligation of the Partnership to such Partner and shall be payable or
collectible only out of the Partnership assets in accordance with the terms and
conditions upon which such advances are made.



                                       20
<PAGE>

                  Section 5.7 Issuances of Additional Partnership Securities.

                  (a) The Partnership may issue additional Partnership
Securities and options, rights, warrants and appreciation rights relating to the
Partnership Securities for any Partnership purpose at any time and from time to
time to such Persons for such consideration and on such terms and conditions as
shall be established by the General Partner in its sole discretion. The issuance
by the Partnership of Partnership Securities or rights, warrants or appreciation
rights in respect thereof shall be deemed an amendment to this Agreement.

                  (b) Each additional Partnership Security authorized to be
issued by the Partnership pursuant to Section 5.7(a) may be issued in one or
more classes, or one or more series of any such classes, with such designations,
preferences, rights, powers and duties (which may be senior to existing classes
and series of Partnership Securities), as shall be fixed by the General Partner
in its sole discretion, including (i) the right to share Partnership profits and
losses or items thereof; (ii) the right to share in Partnership distributions;
(iii) the rights upon dissolution and liquidation of the Partnership; (iv)
whether, and the terms and conditions upon which, the Partnership may redeem
such Partnership Security; (v) whether such Partnership Security is issued with
the privilege of conversion or exchange and, if so, the terms and conditions of
such conversion or exchange; (vi) the terms and conditions upon which each
Partnership Security will be issued, evidenced by certificates and assigned or
transferred; and (vii) the right, if any, of the holder of each such Partnership
Security to vote on Partnership matters, including matters relating to the
relative designations, preferences, rights, powers and duties of such
Partnership Security.

                  (c) The General Partner is hereby authorized and directed to
take all actions that it deems necessary or appropriate in connection with (i)
each issuance of Partnership Securities and options, rights, warrants and
appreciation rights relating to Partnership Securities pursuant to this Section
5.7, (ii) the admission of Additional Limited Partners and (iii) all additional
issuances of Partnership Securities. The General Partner is further authorized
and directed to specify the relative rights, powers and duties of the holders of
the Partnership Interests or other Partnership Securities being so issued. The
General Partner shall do all things necessary to comply with the Delaware Act
and is authorized and directed to do all things it deems necessary or advisable
in connection with any future issuance of Partnership Securities, including
compliance with any statute, rule, regulation or guideline of any federal, state
or other governmental agency.

                  Section 5.8 Limited Preemptive Rights. Except as provided in
Section 5.3, no Person shall have preemptive, preferential or other similar
rights with respect to (a) additional Capital Contributions; (b) issuance or
sale of any class or series of Partnership Interests, whether unissued, held in
the treasury or hereafter created; (c) issuance of any obligations, evidences of
indebtedness or other securities of the Partnership convertible into or
exchangeable for, or carrying or accompanied by any rights to receive, purchase
or subscribe to, any such Partnership Interests; (d) issuance of any right of
subscription to or right to receive, or any warrant or option for the purchase
of, any such Partnership Interests; or (e) issuance or sale of any other
securities that may be issued or sold by the Partnership.



                                       21
<PAGE>

                  Section 5.9 Fully Paid and Non-Assessable Nature of Limited
Partner Interests. All Limited Partner Interests issued pursuant to, and in
accordance with the requirements of, this Article V shall be fully paid and
non-assessable Limited Partner Interests, except as such non-assessability may
be affected by Section 17-607 of the Delaware Act.

                                   ARTICLE VI
                          ALLOCATIONS AND DISTRIBUTIONS

                  Section 6.1 Allocations for Capital Account Purposes. For
purposes of maintaining the Capital Accounts and in determining the rights of
the Partners among themselves, the Partnership's items of income, gain, loss and
deduction (computed in accordance with Section 5.5(b)) shall be allocated among
the Partners in each taxable year (or portion thereof) as provided herein below.

                  (a) Net Income. After giving effect to the special allocations
set forth in Section 6.1(d), Net Income for each taxable year and all items of
income, gain, loss and deduction taken into account in computing Net Income for
such taxable year shall be allocated among the Partners as follows:

                      (i) First, 100% to the General Partner, until the
         aggregate Net Income allocated to the General Partner pursuant to this
         Section 6.1(a)(i) for the current taxable year and all previous taxable
         years is equal to the aggregate Net Losses allocated to the General
         Partner pursuant to Section 6.1(b)(ii) for all previous taxable years;

                      (ii) Second, 0.1% to the General Partner and 99.9% to the
         Limited Partners in accordance with their respective Percentage
         Interests.

                  (b) Net Losses. After giving effect to the special allocations
set forth in Section 6.1(d), Net Losses for each taxable period and all items of
income, gain, loss and deduction taken into account in computing Net Losses for
such taxable period shall be allocated among the Partners as follows:

                      (i) First, 0.1% to the General Partner and 99.9% to the
         Limited Partners, in accordance with their respective Percentage
         Interests; provided, however, that Net Losses shall not be allocated to
         a Limited Partner pursuant to this Section 6.1(b)(i) to the extent that
         such allocation would cause a Limited Partner to have a deficit balance
         in its Adjusted Capital Account at the end of such taxable year (or
         increase any existing deficit balance in such Limited Partner's
         Adjusted Capital Account);

                      (ii) Second, the balance, if any, 100% to the General
         Partner.

                  (c) Net Termination Gains and Losses. After giving effect to
the special allocations set forth in Section 6.1(d), all items of income, gain,
loss and deduction taken into account in computing Net Termination Gain or Net
Termination Loss for such taxable period shall be allocated in the same manner
as such Net Termination Gain or Net Termination Loss is allocated hereunder. All
allocations under this Section 6.1(c) shall be made after Capital Account
balances have been adjusted by all other allocations provided under this Section
6.1 and





                                       22
<PAGE>

after all distributions of Available Cash provided under Section 6.4 have been
made with respect to the taxable period ending on or before the Liquidation
Date; provided, however, that solely for purposes of this Section 6.1(c),
Capital Accounts shall not be adjusted for distributions made pursuant to
Section 12.4.

                      (i) If a Net Termination Gain is recognized (or deemed
         recognized pursuant to Section 5.5(d)), such Net Termination Gain shall
         be allocated among the Partners in the following manner (and the
         Capital Accounts of the Partners shall be increased by the amount so
         allocated in each of the following subclauses, in the order listed,
         before an allocation is made pursuant to the next succeeding
         subclause):

                          (A) First, to each Partner having a deficit balance in
                  its Capital Account, in the proportion that such deficit
                  balance bears to the total deficit balances in the Capital
                  Accounts of all Partners, until each such Partner has been
                  allocated Net Termination Gain equal to any such deficit
                  balance in its Capital Account; and

                          (B) Second, 0.1% to the General Partner and 99.9% to
                  the Limited Partners, in accordance with their respective
                  Percentage Interests.

                      (ii) If a Net Termination Loss is recognized (or deemed
         recognized pursuant to Section 5.5(d)), such Net Termination Loss shall
         be allocated among the Partners in the following manner:

                          (A) First, to the General Partner and the Limited
                  Partners in proportion to, and to the extent of, the positive
                  balances in their respective Capital Accounts; and

                          (B) Second, the balance, if any, 100% to the General
                  Partner.

                  (d) Special Allocations. Notwithstanding any other provision
of this Section 6.1, the following special allocations shall be made for such
taxable period:

                      (i) Partnership Minimum Gain Chargeback. Notwithstanding
         any other provision of this Section 6.1, if there is a net decrease in
         Partnership Minimum Gain during any Partnership taxable period, each
         Partner shall be allocated items of Partnership income and gain for
         such period (and, if necessary, subsequent periods) in the manner and
         amounts provided in Treasury Regulation Sections 1.704-2(f)(6),
         1.704-2(g)(2) and 1.704-2(j)(2)(i), or any successor provision. For
         purposes of this Section 6.1(d), each Partner's Adjusted Capital
         Account balance shall be determined, and the allocation of income or
         gain required hereunder shall be effected, prior to the application of
         any other allocations pursuant to this Section 6.1(d) with respect to
         such taxable period (other than an allocation pursuant to Sections
         6.1(d)(v) and 6.1(d)(vi)). This Section 6.1(d)(i) is intended to comply
         with the Partnership Minimum Gain chargeback requirement in Treasury
         Regulation Section 1.704-2(f) and shall be interpreted consistently
         therewith.





                                       23
<PAGE>

                      (ii) Chargeback of Partner Nonrecourse Debt Minimum Gain.
         Notwithstanding the other provisions of this Section 6.1 (other than
         Section 6.1(d)(i)), except as provided in Treasury Regulation Section
         1.704-2(i)(4), if there is a net decrease in Partner Nonrecourse Debt
         Minimum Gain during any Partnership taxable period, any Partner with a
         share of Partner Nonrecourse Debt Minimum Gain at the beginning of such
         taxable period shall be allocated items of Partnership income and gain
         for such period (and, if necessary, subsequent periods) in the manner
         and amounts provided in Treasury Regulation Sections 1.704-2(i)(4) and
         1.704-2(j)(2)(ii), or any successor provisions. For purposes of this
         Section 6.1(d), each Partner's Adjusted Capital Account balance shall
         be determined, and the allocation of income or gain required hereunder
         shall be effected, prior to the application of any other allocations
         pursuant to this Section 6.1(d), other than Section 6.1(d)(i) and other
         than an allocation pursuant to Sections 6.1(d)(v) and 6.1(d)(vi), with
         respect to such taxable period. This Section 6.1(d)(ii) is intended to
         comply with the chargeback of items of income and gain requirement in
         Treasury Regulation Section 1.704-2(i)(4) and shall be interpreted
         consistently therewith.

                      (iii) Qualified Income Offset. In the event any Partner
         unexpectedly receives any adjustments, allocations or distributions
         described in Treasury Regulation Sections 1.704-1(b)(2)(ii)(d)(4),
         1.704-1(b)(2)(ii)(d)(5), or 1.704-1(b)(2)(ii)(d)(6), items of
         Partnership income and gain shall be specially allocated to such
         Partner in an amount and manner sufficient to eliminate, to the extent
         required by the Treasury Regulations promulgated under Section 704(b)
         of the Code, the deficit balance, if any, in its Adjusted Capital
         Account created by such adjustments, allocations or distributions as
         quickly as possible unless such deficit balance is otherwise eliminated
         pursuant to Section 6.1(d)(i) or (ii).

                      (iv) Gross Income Allocations. In the event any Partner
         has a deficit balance in its Capital Account at the end of any
         Partnership taxable period in excess of the sum of (A) the amount such
         Partner is required to restore pursuant to the provisions of this
         Agreement and (B) the amount such Partner is deemed obligated to
         restore pursuant to Treasury Regulation Sections 1.704-2(g) and
         1.704-2(i)(5), such Partner shall be specially allocated items of
         Partnership gross income and gain in the amount of such excess as
         quickly as possible; provided, that an allocation pursuant to this
         Section 6.1(d)(iv) shall be made only if and to the extent that such
         Partner would have a deficit balance in its Capital Account as adjusted
         after all other allocations provided for in this Section 6.1 have been
         tentatively made as if this Section 6.1(d)(iv) were not in this
         Agreement.

                      (v) Nonrecourse Deductions. Nonrecourse Deductions for any
         taxable period shall be allocated to the Partners in accordance with
         their respective Percentage Interests. If the General Partner
         determines in its good faith discretion that the Partnership's
         Nonrecourse Deductions must be allocated in a different ratio to
         satisfy the safe harbor requirements of the Treasury Regulations
         promulgated under Section 704(b) of the Code, the General Partner is
         authorized, upon notice to the other Partners, to revise the prescribed
         ratio to the numerically closest ratio that does satisfy such
         requirements.



                                       24
<PAGE>

                      (vi) Partner Nonrecourse Deductions. Partner Nonrecourse
         Deductions for any taxable period shall be allocated 100% to the
         Partner that bears the Economic Risk of Loss with respect to the
         Partner Nonrecourse Debt to which such Partner Nonrecourse Deductions
         are attributable in accordance with Treasury Regulation Section
         1.704-2(i). If more than one Partner bears the Economic Risk of Loss
         with respect to a Partner Nonrecourse Debt, such Partner Nonrecourse
         Deductions attributable thereto shall be allocated between or among
         such Partners in accordance with the ratios in which they share such
         Economic Risk of Loss.

                      (vii) Nonrecourse Liabilities. For purposes of Treasury
         Regulation Section 1.752-3(a)(3), the Partners agree that Nonrecourse
         Liabilities of the Partnership in excess of the sum of (A) the amount
         of Partnership Minimum Gain and (B) the total amount of Nonrecourse
         Built-in Gain shall be allocated among the Partners in accordance with
         their respective Percentage Interests.

                      (viii) Code Section 754 Adjustments. To the extent an
         adjustment to the adjusted tax basis of any Partnership asset pursuant
         to Section 734(b) or 743(c) of the Code is required, pursuant to
         Treasury Regulation Section 1.704-1(b)(2)(iv)(m), to be taken into
         account in determining Capital Accounts, the amount of such adjustment
         to the Capital Accounts shall be treated as an item of gain (if the
         adjustment increases the basis of the asset) or loss (if the adjustment
         decreases such basis), and such item of gain or loss shall be specially
         allocated to the Partners in a manner consistent with the manner in
         which their Capital Accounts are required to be adjusted pursuant to
         such Section of the Treasury Regulations.

                      (ix) Curative Allocation.

                           (A) Notwithstanding any other provision of this
                  Section 6.1, other than the Required Allocations, the Required
                  Allocations shall be taken into account in making the Agreed
                  Allocations so that, to the extent possible, the net amount of
                  items of income, gain, loss and deduction allocated to each
                  Partner pursuant to the Required Allocations and the Agreed
                  Allocations, together, shall be equal to the net amount of
                  such items that would have been allocated to each such Partner
                  under the Agreed Allocations had the Required Allocations and
                  the related Curative Allocation not otherwise been provided in
                  this Section 6.1. Notwithstanding the preceding sentence,
                  Required Allocations relating to (1) Nonrecourse Deductions
                  shall not be taken into account except to the extent that
                  there has been a decrease in Partnership Minimum Gain and (2)
                  Partner Nonrecourse Deductions shall not be taken into account
                  except to the extent that there has been a decrease in Partner
                  Nonrecourse Debt Minimum Gain. Allocations pursuant to this
                  Section 6.1(d)(ix)(A) shall only be made with respect to
                  Required Allocations to the extent the General Partner
                  reasonably determines that such allocations will otherwise be
                  inconsistent with the economic agreement among the Partners.
                  Further, allocations pursuant to this Section 6.1(d)(ix)(A)
                  shall be deferred with respect to allocations pursuant to
                  clauses (1) and (2) hereof to the extent the General Partner
                  reasonably determines that such allocations are likely to be
                  offset by subsequent Required Allocations.


                                       25
<PAGE>

                           (B) The General Partner shall have reasonable
                  discretion, with respect to each taxable period, to (1) apply
                  the provisions of Section 6.1(d)(ix)(A) in whatever order is
                  most likely to minimize the economic distortions that might
                  otherwise result from the Required Allocations, and (2) divide
                  all allocations pursuant to Section 6.1(d)(ix)(A) among the
                  Partners in a manner that is likely to minimize such economic
                  distortions.

                  Section 6.2 Allocations for Tax Purposes.

                  (a) Except as otherwise provided herein, for federal income
tax purposes, each item of income, gain, loss and deduction shall be allocated
among the Partners in the same manner as its correlative item of "book" income,
gain, loss or deduction is allocated pursuant to Section 6.1.

                  (b) In an attempt to eliminate Book-Tax Disparities
attributable to a Contributed Property or Adjusted Property, items of income,
gain, loss, depreciation, amortization and cost recovery deductions shall be
allocated for federal income tax purposes among the Partners as follows:

                      (i) (A) In the case of a Contributed Property, such items
         attributable thereto shall be allocated among the Partners in the
         manner provided under Section 704(c) of the Code that takes into
         account the variation between the Agreed Value of such property and its
         adjusted basis at the time of contribution; and (B) any item of
         Residual Gain or Residual Loss attributable to a Contributed Property
         shall be allocated among the Partners in the same manner as its
         correlative item of "book" gain or loss is allocated pursuant to
         Section 6.1.

                      (ii) (A) In the case of an Adjusted Property, such items
         shall (1) first, be allocated among the Partners in a manner consistent
         with the principles of Section 704(c) of the Code to take into account
         the Unrealized Gain or Unrealized Loss attributable to such property
         and the allocations thereof pursuant to Section 5.5(d)(i) or
         5.5(d)(ii), and (2) second, in the event such property was originally a
         Contributed Property, be allocated among the Partners in a manner
         consistent with Section 6.2(b)(i)(A); and (B) any item of Residual Gain
         or Residual Loss attributable to an Adjusted Property shall be
         allocated among the Partners in the same manner as its correlative item
         of "book" gain or loss is allocated pursuant to Section 6.1.

                      (iii) The General Partner shall apply the principles of
         Treasury Regulation Section 1.704-3(d) to eliminate Book-Tax
         Disparities.

                  (c) For the proper administration of the Partnership and for
the preservation of uniformity of the Units or other limited partner interests
of the MLP (or any class or classes thereof), the General Partner shall have
sole discretion to (i) adopt such conventions as it deems appropriate in
determining the amount of depreciation, amortization and cost recovery
deductions; (ii) make special allocations for federal income tax purposes of
income (including, without limitation, gross income) or deductions; and (iii)
amend the provisions of this Agreement as appropriate (x) to reflect the
proposal or promulgation of Treasury Regulations under Section





                                       26
<PAGE>

704(b) or Section 704(c) of the Code or (y) otherwise to preserve or achieve
uniformity of the Units or other limited partner interests of the MLP (or any
class or classes thereof). The General Partner may adopt such conventions, make
such allocations and make such amendments to this Agreement as provided in this
Section 6.2(c) only if such conventions, allocations or amendments would not
have a material adverse effect on the Partners, the holders of any class or
classes of Units or other limited partner interests of the MLP issued and
outstanding or the Partnership, and if such allocations are consistent with the
principles of Section 704 of the Code.

                  (d) The General Partner in its discretion may determine to
depreciate or amortize the portion of an adjustment under Section 743(b) of the
Code attributable to unrealized appreciation in any Adjusted Property (to the
extent of the unamortized Book-Tax Disparity) using a predetermined rate derived
from the depreciation or amortization method and useful life applied to the
Partnership's common basis of such property, despite any inconsistency of such
approach with Treasury Regulation Section 1.167(c)-l(a)(6) or any successor
regulations thereto. If the General Partner determines that such reporting
position cannot reasonably be taken, the General Partner may adopt depreciation
and amortization conventions under which all purchasers acquiring limited
partner interests of the MLP in the same month would receive depreciation and
amortization deductions, based upon the same applicable rate as if they had
purchased a direct interest in the Partnership's property. If the General
Partner chooses not to utilize such aggregate method, the General Partner may
use any other reasonable depreciation and amortization conventions to preserve
the uniformity of the intrinsic tax characteristics of any limited partner
interests of the MLP that would not have a material adverse effect on the
Partners or the holders of any class or classes of limited partner interests of
the MLP.

                  (e) Any gain allocated to the Partners upon the sale or other
taxable disposition of any Partnership asset shall, to the extent possible,
after taking into account other required allocations of gain pursuant to this
Section 6.2, be characterized as Recapture Income in the same proportions and to
the same extent as such Partners (or their predecessors in interest) have been
allocated any deductions directly or indirectly giving rise to the treatment of
such gains as Recapture Income.

                  (f) All items of income, gain, loss, deduction and credit
recognized by the Partnership for federal income tax purposes and allocated to
the Partners in accordance with the provisions hereof shall be determined
without regard to any election under Section 754 of the Code that may be made by
the Partnership; provided, however, that such allocations, once made, shall be
adjusted as necessary or appropriate to take into account those adjustments
permitted or required by Sections 734 and 743 of the Code.

                  (g) The General Partner may adopt such methods of allocation
of income, gain, loss or deduction between a transferor and a transferee of a
Partnership Interest as it determines necessary or appropriate in its sole
discretion, to the extent permitted or required by Section 706 of the Code and
the regulations or rulings promulgated thereunder.

                  (h) Allocations that would otherwise be made to a Partner
under the provisions of this Article VI shall instead be made to the beneficial
owner of Partnership Interests held by a nominee in any case in which the
nominee has furnished the identity of such




                                       27
<PAGE>

owner to the Partnership in accordance with Section 6031(c) of the Code or any
other method acceptable to the General Partner in its sole discretion.

                  Section 6.3 Distributions.

                  (a) Within 45 days following the end of each Quarter
commencing with the Quarter ending on September 30, 2002, an amount equal to
100% of Available Cash with respect to such Quarter shall, subject to Section
17-607 of the Delaware Act, be distributed in accordance with this Article VI by
the Partnership to the Partners in accordance with their respective Percentage
Interests. The immediately preceding sentence shall not require any distribution
of cash if and to the extent such distribution would be prohibited by applicable
law or by any loan agreement, security agreement, mortgage, debt instrument or
other agreement or obligation to which the Partnership is a party or by which it
is bound or its assets are subject. All distributions required to be made under
this Agreement shall be made subject to Section 17-607 of the Delaware Act.

                  (b) In the event of the dissolution and liquidation of the
Partnership, all receipts received during or after the Quarter in which the
Liquidation Date occurs, other than from borrowings described in (a)(ii) of the
definition of Available Cash, shall be applied and distributed solely in
accordance with, and subject to the terms and conditions of, Section 12.4.

                  (c) The General Partner shall have the discretion to treat
taxes paid by the Partnership on behalf of, or amounts withheld with respect to,
all or less than all of the Partners, as a distribution of Available Cash to
such Partners.

                                  ARTICLE VII
                      MANAGEMENT AND OPERATION OF BUSINESS

                  Section 7.1 Management.

                  (a) The General Partner shall conduct, direct and manage all
activities of the Partnership. Except as otherwise expressly provided in this
Agreement, all management powers over the business and affairs of the
Partnership shall be exclusively vested in the General Partner, and no Limited
Partner or Assignee shall have any management power over the business and
affairs of the Partnership. In addition to the powers now or hereafter granted a
general partner of a limited partnership under applicable law or that are
granted to the General Partner under any other provision of this Agreement, the
General Partner, subject to Section 7.3, shall have full power and authority to
do all things and on such terms as it, in its sole discretion, may deem
necessary or appropriate to conduct the business of the Partnership, to exercise
all powers set forth in Section 2.5 and to effectuate the purposes set forth in
Section 2.4, including the following:

                      (i) the making of any expenditures, the lending or
         borrowing of money, the assumption or guarantee of, or other
         contracting for, indebtedness and other liabilities, the issuance of
         evidences of indebtedness, including indebtedness that is convertible
         into a Partnership Interest, and the incurring of any other
         obligations;



                                       28
<PAGE>

                      (ii) the making of tax, regulatory and other filings, or
         rendering of periodic or other reports to governmental or other
         agencies having jurisdiction over the business or assets of the
         Partnership;

                      (iii) the acquisition, disposition, mortgage, pledge,
         encumbrance, hypothecation or exchange of any or all of the assets of
         the Partnership or the merger or other combination of the Partnership
         with or into another Person (the matters described in this clause (iii)
         being subject, however, to any prior approval that may be required by
         Section 7.3);

                      (iv) the use of the assets of the Partnership (including
         cash on hand) for any purpose consistent with the terms of this
         Agreement, including the financing of the conduct of the operations of
         the Partnership Group; subject to Section 7.6, the lending of funds to
         other Persons (including the MLP and any member of the Partnership
         Group); the repayment of obligations of the MLP or any member of the
         Partnership Group and the making of capital contributions to any member
         of the Partnership Group;

                      (v) the negotiation, execution and performance of any
         contracts, conveyances or other instruments (including instruments that
         limit the liability of the Partnership under contractual arrangements
         to all or particular assets of the Partnership, with the other party to
         the contract to have no recourse against the General Partner or its
         assets other than its interest in the Partnership, even if same results
         in the terms of the transaction being less favorable to the Partnership
         than would otherwise be the case);

                      (vi) the distribution of Partnership cash;

                      (vii) the selection and dismissal of employees (including
         employees having titles such as "president," "vice president,"
         "secretary" and "treasurer") and agents, outside attorneys,
         accountants, consultants and contractors and the determination of their
         compensation and other terms of employment or hiring;

                      (viii) the maintenance of such insurance for the benefit
         of the Partnership Group and the Partners as it deems necessary or
         appropriate;

                      (ix) the formation of, or acquisition of an interest in,
         and the contribution of property and the making of loans to, any
         further limited or general partnerships, joint ventures, corporations,
         limited liability companies or other relationships subject to the
         restrictions set forth in Section 2.4;

                      (x) the control of any matters affecting the rights and
         obligations of the Partnership, including the bringing and defending of
         actions at law or in equity and otherwise engaging in the conduct of
         litigation and the incurring of legal expense and the settlement of
         claims and litigation; and

                      (xi) the indemnification of any Person against liabilities
         and contingencies to the extent permitted by law.



                                       29
<PAGE>

                  (b) Notwithstanding any other provision of this Agreement, the
MLP Agreement, the Delaware Act or any applicable law, rule or regulation, each
of the Partners and the Assignees and each other Person who may acquire an
interest in the Partnership hereby (i) approves, ratifies and confirms the
execution, delivery and performance by the parties thereto of this Agreement,
the Underwriting Agreement, the Omnibus Agreement, the Contribution Agreement
and the other agreements and documents described in or filed as exhibits to the
Registration Statement that are related to the transactions contemplated by the
Registration Statement; (ii) agrees that the General Partner (on its own or
through any officer of the Partnership) is authorized to execute, deliver and
perform the agreements referred to in clause (i) of this sentence, as
applicable, and the other agreements, acts, transactions and matters described
in or contemplated by the Registration Statement on behalf of the Partnership
without any further act, approval or vote of the Partners or the Assignees or
the other Persons who may acquire an interest in the Partnership; and (iii)
agrees that the execution, delivery or performance by the General Partner, the
MLP, any Group Member or any Affiliate of any of them, of this Agreement or any
agreement authorized or permitted under this Agreement (including the exercise
by the General Partner or any Affiliate of the General Partner of the rights
accorded pursuant to Article XV), shall not constitute a breach by the General
Partner of any duty that the General Partner may owe the Partnership or the
Limited Partners or any other Persons under this Agreement (or any other
agreements) or of any duty stated or implied by law or equity.

                  Section 7.2 Certificate of Limited Partnership. The General
Partner has caused the Certificate of Limited Partnership to be filed with the
Secretary of State of the State of Delaware as required by the Delaware Act. The
General Partner shall use all reasonable efforts to cause to be filed such other
certificates or documents as may be determined by the General Partner in its
sole discretion to be reasonable and necessary or appropriate for the formation,
continuation, qualification and operation of a limited partnership (or a
partnership in which the limited partners have limited liability) in the State
of Delaware or any other state in which the Partnership may elect to do business
or own property. To the extent that such action is determined by the General
Partner in its sole discretion to be reasonable and necessary or appropriate,
the General Partner shall file amendments to and restatements of the Certificate
of Limited Partnership and do all things to maintain the Partnership as a
limited partnership (or a partnership or other entity in which the limited
partners have limited liability) under the laws of the State of Delaware or of
any other state in which the Partnership may elect to do business or own
property. Subject to the terms of Section 3.4(a), the General Partner shall not
be required, before or after filing, to deliver or mail a copy of the
Certificate of Limited Partnership, any qualification document or any amendment
thereto to any Limited Partner or Assignee.

                  Section 7.3 Restrictions on the General Partner's Authority.

                  (a) The General Partner may not, without written approval of
the specific act by the Limited Partners or by other written instrument executed
and delivered by the Limited Partners subsequent to the date of this Agreement,
take any action in contravention of this Agreement, including, except as
otherwise provided in this Agreement, (i) committing any act that would make it
impossible to carry on the ordinary business of the Partnership; (ii) possessing
Partnership property, or assigning any rights in specific Partnership property,
for other than a Partnership purpose; (iii) admitting a Person as a Partner;
(iv) amending this Agreement in any manner; or (v) transferring its General
Partner Interest.



                                       30
<PAGE>

                  (b) Except as provided in Articles XII and XIV, the General
Partner may not sell, exchange or otherwise dispose of all or substantially all
of the Partnership's assets in a single transaction or a series of related
transactions (including by way of merger, consolidation or other combination) or
approve on behalf of the Partnership the sale, exchange or other disposition of
all or substantially all of the assets of the Partnership, without the approval
of the Limited Partners; provided however that this provision shall not preclude
or limit the General Partner's ability to mortgage, pledge, hypothecate or grant
a security interest in all or substantially all of the assets of the Partnership
and shall not apply to any forced sale of any or all of the assets of the
Partnership pursuant to the foreclosure of, or other realization upon, any such
encumbrance.

                  Section 7.4 Reimbursement of the General Partner.

                  (a) Except as provided in this Section 7.4 and elsewhere in
this Agreement or in the Omnibus Agreement, the General Partner shall not be
compensated for its services as General Partner or as general partner or
managing member of any Group Member.

                  (b) The General Partner shall be reimbursed on a monthly
basis, or such other reasonable basis as the General Partner may determine in
its sole discretion, for (i) all direct and indirect expenses it incurs or
payments it makes on behalf of the Partnership (including salary, bonus,
incentive compensation and other amounts paid to any Person including Affiliates
of the General Partner to perform services for the Partnership or for the
General Partner in the discharge of its duties to the Partnership), and (ii) all
other necessary or appropriate expenses allocable to the Partnership or
otherwise reasonably incurred by the General Partner in connection with
operating the Partnership's business (including expenses allocated to the
General Partner by its Affiliates). The General Partner shall determine the
expenses that are allocable to the Partnership in any reasonable manner
determined by the General Partner in its sole discretion. Reimbursements
pursuant to this Section 7.4 shall be in addition to any reimbursement to the
General Partner as a result of indemnification pursuant to Section 7.7.

                  (c) Subject to Section 5.7, the General Partner, in its sole
discretion and without the approval of the Limited Partners (who shall have no
right to vote in respect thereof), may propose and adopt on behalf of the
Partnership employee benefit plans, employee programs and employee practices, or
cause the Partnership to issue Partnership Interests in connection with or
pursuant to any employee benefit plan, employee program or employee practice
maintained or sponsored by the General Partner or any of its Affiliates, in each
case for the benefit of employees of the General Partner, any Group Member or
any Affiliate, or any of them, in respect of services performed, directly or
indirectly, for the benefit of the Partnership Group. Expenses incurred by the
General Partner in connection with any such plans, programs and practices shall
be reimbursed in accordance with Section 7.4(b). Any and all obligations of the
General Partner under any employee benefit plans, employee programs or employee
practices adopted by the General Partner as permitted by this Section 7.4(c)
shall constitute obligations of the General Partner hereunder and shall be
assumed by any successor General Partner approved pursuant to Section 11.1 or
11.2 or the transferee of or successor to all of the General Partner's General
Partner Interest pursuant to Section 4.2.


                                       31
<PAGE>
                  Section 7.5 Outside Activities.

                  (a) After the Closing Date, the General Partner, for so long
as it is the General Partner of the Partnership, (i) agrees that its sole
business will be to act as the General Partner of the Partnership and a general
partner or managing member, as the case may be, of any other partnership or
limited liability company of which the Partnership is, directly or indirectly, a
partner or member, and to undertake activities that are ancillary or related
thereto, and (ii) shall not engage in any business or activity or incur any
debts or liabilities except in connection with or incidental to (A) its
performance as general partner of the Partnership or one or more Group Members
or as described in or contemplated by the Registration Statement or (B) the
acquiring, owning or disposing of debt or equity securities in any Group Member.

                  (b) Except as specifically restricted by Section 7.5(a) and
the Omnibus Agreement, each Indemnitee (other than the General Partner) shall
have the right to engage in businesses of every type and description and other
activities for profit and to engage in and possess an interest in other business
ventures of any and every type or description, whether in businesses engaged in
or anticipated to be engaged in by the MLP or any Group Member, independently or
with others, including business interests and activities in direct competition
with the business and activities of the MLP or any Group Member, and none of the
same shall constitute a breach of this Agreement or any duty express or implied
by law to the MLP or any Group Member or any Partner or Assignee. Neither the
MLP nor any Group Member, any Limited Partner nor any other Person shall have
any rights by virtue of this Agreement, the MLP Agreement or the partnership
relationship established hereby or thereby in any business ventures of any
Indemnitee.

                  (c) Subject to the terms of Section 7.5(a), Section 7.5(b) and
the Omnibus Agreement, but otherwise notwithstanding anything to the contrary in
this Agreement, (i) the engaging in competitive activities by any Indemnitee
(other than the General Partner) in accordance with the provisions of this
Section 7.5 is hereby approved by the Partnership and all Partners, (ii) it
shall be deemed not to be a breach of the General Partner's fiduciary duty or
any other obligation of any type whatsoever of the General Partner for the
Indemnitees (other than the General Partner) to engage in such business
interests and activities in preference to or to the exclusion of the Partnership
and (iii) except as set forth in the Omnibus Agreement, the Indemnitees shall
have no obligation to present business opportunities to the Partnership.

                  (d) The General Partner and any of its Affiliates may acquire
Units or other MLP Securities in addition to those acquired on the Closing Date
and, except as otherwise provided in this Agreement, shall be entitled to
exercise all rights relating to such Units or MLP Securities.

                  (e) The term "Affiliates" when used in Section 7.5(a) and
Section 7.5(d) with respect to the General Partner shall not include any Group
Member or any Subsidiary of the MLP or any Group Member.

                  (f) Anything in this Agreement to the contrary
notwithstanding, to the extent that provisions of Sections 7.7, 7.8, 7.9, 7.10
or other Sections of this Agreement purport or are interpreted to have the
effect of restricting the fiduciary duties that might otherwise, as a result of



                                       32
<PAGE>

Delaware or other applicable law, be owed by the General Partner to the
Partnership and its Limited Partners, or to constitute a waiver or consent by
the Limited Partners to any such restriction, such provisions shall be
inapplicable and have no effect in determining whether the General Partner has
complied with its fiduciary duties in connection with determinations made by it
under this Section 7.5.

                  Section 7.6 Loans from the General Partner; Loans or
Contributions from the Partnership; Contracts with Affiliates; Certain
Restrictions on the General Partner.

                  (a) The General Partner or any of its Affiliates may lend to
the Partnership, the MLP or any Group Member, and the Partnership, the MLP or
any Group Member may borrow from the General Partner or any of its Affiliates,
funds needed or desired by the MLP or the Group Member for such periods of time
and in such amounts as the General Partner may determine; provided, however,
that in any such case the lending party may not charge the borrowing party
interest at a rate greater than the rate that would be charged the borrowing
party or impose terms less favorable to the borrowing party than would be
charged or imposed on the borrowing party by unrelated lenders on comparable
loans made on an arm's-length basis (without reference to the lending party's
financial abilities or guarantees). The borrowing party shall reimburse the
lending party for any costs (other than any additional interest costs) incurred
by the lending party in connection with the borrowing of such funds. For
purposes of this Section 7.6(a) and Section 7.6(b), the term "Group Member"
shall include any Affiliate of a Group Member that is controlled by the Group
Member.

                  (b) The Partnership may lend or contribute to any Group
Member, and any Group Member may borrow from the Partnership, funds on terms and
conditions established in the sole discretion of the General Partner; provided,
however, that the Partnership may not charge the Group Member interest at a rate
less than the rate that would be charged to the Group Member (without reference
to the General Partner's financial abilities or guarantees) by unrelated lenders
on comparable loans. The foregoing authority shall be exercised by the General
Partner in its sole discretion and shall not create any right or benefit in
favor of any Group Member or any other Person.

                  (c) The General Partner may itself, or may enter into an
agreement with the MLP General Partner or any of its Affiliates to, render
services to a Group Member or to the General Partner in the discharge of its
duties as general partner of the Partnership. Any services rendered to a Group
Member by the General Partner, the MLP General Partner or any of their
Affiliates shall be on terms that are fair and reasonable to the Partnership;
provided, however, that the requirements of this Section 7.6(c) shall be deemed
satisfied as to (i) any transaction approved by Special Approval, (ii) any
transaction, the terms of which are no less favorable to the Partnership Group
than those generally being provided to or available from unrelated third parties
or (iii) any transaction that, taking into account the totality of the
relationships between the parties involved (including other transactions that
may be particularly favorable or advantageous to the Partnership Group), is
equitable to the Partnership Group. The provisions of Section 7.4 shall apply to
the rendering of services described in this Section 7.6(c).

                  (d) The Partnership Group may transfer assets to joint
ventures, other partnerships, corporations, limited liability companies or other
business entities in which it is or




                                       33
<PAGE>

thereby becomes a participant upon such terms and subject to such conditions as
are consistent with this Agreement and applicable law.

                  (e) Neither the General Partner nor any of its Affiliates
shall sell, transfer or convey any property to, or purchase any property from,
the Partnership, directly or indirectly, except pursuant to transactions that
are fair and reasonable to the Partnership; provided, however, that the
requirements of this Section 7.6(e) shall be deemed to be satisfied as to (i)
the transactions effected pursuant to Sections 5.2 and 5.3, the Contribution
Agreement and any other transactions described in or contemplated by the
Registration Statement, (ii) any transaction approved by Special Approval, (iii)
any transaction, the terms of which are no less favorable to the Partnership
than those generally being provided to or available from unrelated third
parties, or (iv) any transaction that, taking into account the totality of the
relationships between the parties involved (including other transactions that
may be particularly favorable or advantageous to the Partnership Group), is
equitable to the Partnership.

                  (f) The General Partner and its Affiliates will have no
obligation to permit any Group Member to use any facilities or assets of the
General Partner and its Affiliates, except as may be provided in contracts
entered into from time to time specifically dealing with such use, nor shall
there be any obligation on the part of the General Partner or its Affiliates to
enter into such contracts.

                  (g) Without limitation of Sections 7.6(a) through 7.6(f), and
notwithstanding anything to the contrary in this Agreement, the existence of the
conflicts of interest described in the Registration Statement are hereby
approved by all Partners.

                  Section 7.7 Indemnification.

                  (a) To the fullest extent permitted by law but subject to the
limitations expressly provided in this Agreement, all Indemnitees shall be
indemnified and held harmless by the Partnership from and against any and all
losses, claims, damages, liabilities, joint or several, expenses (including
legal fees and expenses), judgments, fines, penalties, interest, settlements or
other amounts arising from any and all claims, demands, actions, suits or
proceedings, whether civil, criminal, administrative or investigative, in which
any Indemnitee may be involved, or is threatened to be involved, as a party or
otherwise, by reason of its status as an Indemnitee; provided, that in each case
the Indemnitee acted in good faith and in a manner that such Indemnitee
reasonably believed to be in, or (in the case of a Person other than the General
Partner) not opposed to, the best interests of the Partnership and, with respect
to any criminal proceeding, had no reasonable cause to believe its conduct was
unlawful; provided, further, no indemnification pursuant to this Section 7.7
shall be available to the General Partner with respect to its obligations
incurred pursuant to the Underwriting Agreement or the Contribution Agreement
(other than obligations incurred by the General Partner on behalf of the
Partnership). The termination of any action, suit or proceeding by judgment,
order, settlement, conviction or upon a plea of nolo contendere, or its
equivalent, shall not create a presumption that the Indemnitee acted in a manner
contrary to that specified above. Any indemnification pursuant to this Section
7.7 shall be made only out of the assets of the Partnership, it being agreed
that the General Partner shall not be personally liable for such indemnification
and shall have no





                                       34
<PAGE>

obligation to contribute or loan any monies or property to the Partnership to
enable it to effectuate such indemnification.

                  (b) To the fullest extent permitted by law, expenses
(including legal fees and expenses) incurred by an Indemnitee who is indemnified
pursuant to Section 7.7(a) in defending any claim, demand, action, suit or
proceeding shall, from time to time, be advanced by the Partnership prior to the
final disposition of such claim, demand, action, suit or proceeding upon receipt
by the Partnership of any undertaking by or on behalf of the Indemnitee to repay
such amount if it shall be determined that the Indemnitee is not entitled to be
indemnified as authorized in this Section 7.7.

                  (c) The indemnification provided by this Section 7.7 shall be
in addition to any other rights to which an Indemnitee may be entitled under any
agreement, pursuant to any vote of the Partners, as a matter of law or
otherwise, both as to actions in the Indemnitee's capacity as an Indemnitee and
as to actions in any other capacity (including any capacity under the
Underwriting Agreement), and shall continue as to an Indemnitee who has ceased
to serve in such capacity and shall inure to the benefit of the heirs,
successors, assigns and administrators of the Indemnitee.

                  (d) The Partnership may purchase and maintain (or reimburse
the General Partner or its Affiliates for the cost of) insurance, on behalf of
the General Partner, its Affiliates and such other Persons as the General
Partner shall determine, against any liability that may be asserted against or
expense that may be incurred by such Person in connection with the Partnership's
activities or such Person's activities on behalf of the Partnership, regardless
of whether the Partnership would have the power to indemnify such Person against
such liability under the provisions of this Agreement.

                  (e) For purposes of this Section 7.7, the Partnership shall be
deemed to have requested an Indemnitee to serve as fiduciary of an employee
benefit plan whenever the performance by it of its duties to the Partnership
also imposes duties on, or otherwise involves services by, it to the plan or
participants or beneficiaries of the plan; excise taxes assessed on an
Indemnitee with respect to an employee benefit plan pursuant to applicable law
shall constitute "fines" within the meaning of Section 7.7(a); and action taken
or omitted by it with respect to any employee benefit plan in the performance of
its duties for a purpose reasonably believed by it to be in the interest of the
participants and beneficiaries of the plan shall be deemed to be for a purpose
that is in, or not opposed to, the best interests of the Partnership.

                  (f) In no event may an Indemnitee subject the Limited Partners
to personal liability by reason of the indemnification provisions set forth in
this Agreement.

                  (g) An Indemnitee shall not be denied indemnification in whole
or in part under this Section 7.7 because the Indemnitee had an interest in the
transaction with respect to which the indemnification applies if the transaction
was otherwise permitted by the terms of this Agreement.



                                       35
<PAGE>

                  (h) The provisions of this Section 7.7 are for the benefit of
the Indemnitees, their heirs, successors, assigns and administrators and shall
not be deemed to create any rights for the benefit of any other Persons.

                  (i) No amendment, modification or repeal of this Section 7.7
or any provision hereof shall in any manner terminate, reduce or impair the
right of any past, present or future Indemnitee to be indemnified by the
Partnership, nor the obligations of the Partnership to indemnify any such
Indemnitee under and in accordance with the provisions of this Section 7.7 as in
effect immediately prior to such amendment, modification or repeal with respect
to claims arising from or relating to matters occurring, in whole or in part,
prior to such amendment, modification or repeal, regardless of when such claims
may arise or be asserted.

                  Section 7.8 Liability of Indemnitees.

                  (a) Notwithstanding anything to the contrary set forth in this
Agreement, no Indemnitee shall be liable for monetary damages to the
Partnership, the Limited Partners, the Assignees or any other Persons who have
acquired interests in the Units or other MLP Securities, for losses sustained or
liabilities incurred as a result of any act or omission if such Indemnitee acted
in good faith.

                  (b) Subject to its obligations and duties as General Partner
set forth in Section 7.1(a), the General Partner may exercise any of the powers
granted to it by this Agreement and perform any of the duties imposed upon it
hereunder either directly or by or through its agents, and the General Partner
shall not be responsible for any misconduct or negligence on the part of any
such agent appointed by the General Partner in good faith.

                  (c) To the extent that, at law or in equity, an Indemnitee has
duties (including fiduciary duties) and liabilities relating thereto to the
Partnership or to the Partners, the General Partner and any other Indemnitee
acting in connection with the Partnership's business or affairs shall not be
liable to the Partnership or to any Partner for its good faith reliance on the
provisions of this Agreement. The provisions of this Agreement, to the extent
that they restrict or otherwise modify the duties and liabilities of an
Indemnitee otherwise existing at law or in equity, are agreed by the Partners to
replace such other duties and liabilities of such Indemnitee.

                  (d) Any amendment, modification or repeal of this Section 7.8
or any provision hereof shall be prospective only and shall not in any way
affect the limitations on the liability to the Partnership, the Limited
Partners, the General Partner, and the Partnership's and General Partner's
directors, officers and employees under this Section 7.8 as in effect
immediately prior to such amendment, modification or repeal with respect to
claims arising from or relating to matters occurring, in whole or in part, prior
to such amendment, modification or repeal, regardless of when such claims may
arise or be asserted.

                  Section 7.9 Resolution of Conflicts of Interest.

                  (a) Unless otherwise expressly provided in this Agreement or
the MLP Agreement, whenever a potential conflict of interest exists or arises
between the General Partner or any of its Affiliates, on the one hand, and the
Partnership, the MLP, any Partner or any Assignee, on the other, any resolution
or course of action by the General Partner or its Affiliates



                                       36
<PAGE>

in respect of such conflict of interest shall be permitted and deemed approved
by all Partners, and shall not constitute a breach of this Agreement, of the MLP
Agreement, of any agreement contemplated herein or therein, or of any duty
stated or implied by law or equity, if the resolution or course of action is, or
by operation of this Agreement is deemed to be, fair and reasonable to the
Partnership. The General Partner shall be authorized but not required in
connection with its resolution of such conflict of interest to seek Special
Approval of such resolution and the General Partner may also adopt a resolution
or course of action that has not received Special Approval. Any Special Approval
shall be subject to the presumption that, in making its decision, the Conflicts
Committee acted on an informed basis, in good faith and in the honest belief
that the action taken was in the best interests of the Partnership and the MLP
and, in any proceeding brought by any Limited Partner or by or on behalf of such
Limited Partner or any other Limited Partners or the Partnership challenging
such approval, the Person bringing or prosecuting such proceeding shall have the
burden of overcoming such presumption. Any conflict of interest and any
resolution of such conflict of interest shall be conclusively deemed fair and
reasonable to the Partnership if such conflict of interest or resolution is (i)
approved by Special Approval, (ii) on terms no less favorable to the Partnership
than those generally being provided to or available from unrelated third parties
or (iii) fair to the Partnership, taking into account the totality of the
relationships between the parties involved (including other transactions that
may be particularly favorable or advantageous to the Partnership). The General
Partner may also adopt a resolution or course of action that has not received
Special Approval. The General Partner shall be authorized in connection with its
determination of what is "fair and reasonable" to the Partnership and in
connection with its resolution of any conflict of interest to consider (A) the
relative interests of any party to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interest; (B) any
customary or accepted industry practices and any customary or historical
dealings with a particular Person; (C) any applicable generally accepted
accounting practices or principles; and (D) such additional factors as the
General Partner determines in its sole discretion to be relevant, reasonable or
appropriate under the circumstances. In any proceeding brought by any Limited
Partner or by or on behalf of such Limited Partner or any other Limited Partners
or the Partnership alleging that such a resolution by the General Partner is not
fair to the Partnership, such Limited Partner shall have the burden of proof of
overcoming such conclusion. Nothing contained in this Agreement, however, is
intended to nor shall it be construed to require the General Partner to consider
the interests of any Person other than the Partnership. In the absence of bad
faith by the General Partner, the resolution, action or terms so made, taken or
provided by the General Partner with respect to such matter shall not constitute
a breach of this Agreement or any other agreement contemplated herein or a
breach of any standard of care or duty imposed herein or therein or, to the
extent permitted by law, under the Delaware Act or any other law, rule or
regulation.

                  (b) Whenever this Agreement or any other agreement
contemplated hereby provides that the General Partner or any of its Affiliates
is permitted or required to make a decision (i) in its "sole discretion" or
"discretion," that it deems "necessary or appropriate" or "necessary or
advisable" or under a grant of similar authority or latitude, except as
otherwise provided herein, the General Partner or such Affiliate shall be
entitled to consider only such interests and factors as it desires and shall
have no duty or obligation to give any consideration to any interest of, or
factors affecting, the Partnership, the MLP, any Limited Partner or any
Assignee, (ii) it may make such decision in its sole discretion (regardless of
whether there is a reference to "sole discretion" or "discretion") unless
another express standard is provided for, or



                                       37
<PAGE>

(iii) in "good faith" or under another express standard, the General Partner or
such Affiliate shall act under such express standard and shall not be subject to
any other or different standards imposed by this Agreement, the MLP Agreement,
any other agreement contemplated hereby or under the Delaware Act or any other
law, rule or regulation. In addition, any actions taken by the General Partner
or such Affiliate consistent with the standards of "reasonable discretion" set
forth in the definition of Available Cash shall not constitute a breach of any
duty of the General Partner to the Partnership or the Limited Partners. The
General Partner shall have no duty, express or implied, to sell or otherwise
dispose of any asset of the Partnership Group other than in the ordinary course
of business. No borrowing by any Group Member or the approval thereof by the
General Partner shall be deemed to constitute a breach of any duty of the
General Partner to the Partnership or the Limited Partners by reason of the fact
that the purpose or effect of such borrowing is directly or indirectly to (A)
enable distributions to the General Partner or its Affiliates to exceed 0.01% of
the total amount distributed to all Partners or (B) hasten the expiration of the
Subordination Period or the conversion of any Subordinated Units into Common
Units.

                  (c) Whenever a particular transaction, arrangement or
resolution of a conflict of interest is required under this Agreement to be
"fair and reasonable" to any Person, the fair and reasonable nature of such
transaction, arrangement or resolution shall be considered in the context of all
similar or related transactions.

                  (d) The Limited Partner hereby authorizes the General Partner,
on behalf of the Partnership as a partner or member of a Group Member, to
approve of actions by the general partner or managing member of such Group
Member similar to those actions permitted to be taken by the General Partner
pursuant to this Section 7.9.

                  Section 7.10 Other Matters Concerning the General Partner.

                  (a) The General Partner may rely and shall be protected in
acting or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, bond, debenture or
other paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties.

                  (b) The General Partner may consult with legal counsel,
accountants, appraisers, management consultants, investment bankers and other
consultants and advisers selected by it, and any act taken or omitted to be
taken in reliance upon the opinion (including an Opinion of Counsel) of such
Persons as to matters that the General Partner reasonably believes to be within
such Person's professional or expert competence shall be conclusively presumed
to have been done or omitted in good faith and in accordance with such opinion.

                  (c) The General Partner shall have the right, in respect of
any of its powers or obligations hereunder, to act through any of its duly
authorized officers, a duly appointed attorney or attorneys-in-fact or the duly
authorized officers of the Partnership.

                  (d) Any standard of care and duty imposed by this Agreement or
under the Delaware Act or any applicable law, rule or regulation shall be
modified, waived or limited, to the extent permitted by law, as required to
permit the General Partner to act under this





                                       38
<PAGE>

Agreement or any other agreement contemplated by this Agreement and to make any
decision pursuant to the authority prescribed in this Agreement, so long as such
action is reasonably believed by the General Partner to be in, or not
inconsistent with, the best interests of the Partnership.

                  Section 7.11 Reliance by Third Parties. Notwithstanding
anything to the contrary in this Agreement, any Person dealing with the
Partnership shall be entitled to assume that the General Partner and any officer
of the General Partner authorized by the General Partner to act on behalf of and
in the name of the Partnership has full power and authority to encumber, sell or
otherwise use in any manner any and all assets of the Partnership and to enter
into any authorized contracts on behalf of the Partnership, and such Person
shall be entitled to deal with the General Partner or any such officer as if it
were the Partnership's sole party in interest, both legally and beneficially.
Each Limited Partner hereby waives any and all defenses or other remedies that
may be available against such Person to contest, negate or disaffirm any action
of the General Partner or any such officer in connection with any such dealing.
In no event shall any Person dealing with the General Partner or any such
officer or its representatives be obligated to ascertain that the terms of the
Agreement have been complied with or to inquire into the necessity or expedience
of any act or action of the General Partner or any such officer or its
representatives. Each and every certificate, document or other instrument
executed on behalf of the Partnership by the General Partner or its
representatives shall be conclusive evidence in favor of any and every Person
relying thereon or claiming thereunder that (a) at the time of the execution and
delivery of such certificate, document or instrument, this Agreement was in full
force and effect, (b) the Person executing and delivering such certificate,
document or instrument was duly authorized and empowered to do so for and on
behalf of the Partnership and (c) such certificate, document or instrument was
duly executed and delivered in accordance with the terms and provisions of this
Agreement and is binding upon the Partnership.


                                  ARTICLE VIII
                         BOOKS, RECORDS AND ACCOUNTING

                  Section 8.1 Records and Accounting. The General Partner shall
keep or cause to be kept at the principal office of the Partnership appropriate
books and records with respect to the Partnership's business, including all
books and records necessary to provide to the Limited Partners any information
required to be provided pursuant to Section 3.4(a). Any books and records
maintained by or on behalf of the Partnership in the regular course of its
business, including books of account and records of Partnership proceedings, may
be kept on, or be in the form of, computer disks, hard drives, punch cards,
magnetic tape, photographs, micrographics or any other information storage
device; provided, that the books and records so maintained are convertible into
clearly legible written form within a reasonable period of time. The books of
the Partnership shall be maintained, for financial reporting purposes, on an
accrual basis in accordance with U.S. GAAP.

                  Section 8.2 Fiscal Year. The fiscal year of the Partnership
shall be a fiscal year ending December 31.



                                       39
<PAGE>

                                   ARTICLE IX
                                  TAX MATTERS

                  Section 9.1 Tax Returns and Information. The Partnership shall
timely file all returns of the Partnership that are required for federal, state
and local income tax purposes on the basis of the accrual method and a taxable
year ending on December 31. The tax information reasonably required by the
Partners for federal and state income tax reporting purposes with respect to a
taxable year shall be furnished to them within 90 days of the close of the
calendar year in which the Partnership's taxable year ends. The classification,
realization and recognition of income, gain, losses and deductions and other
items shall be on the accrual method of accounting for federal income tax
purposes.

                  Section 9.2 Tax Elections.

                  (a) To the extent applicable for federal income tax purposes,
the Partnership shall make the election under Section 754 of the Code in
accordance with applicable regulations thereunder, subject to the reservation of
the right to seek to revoke any such election upon the General Partner's
determination that such revocation is in the best interests of the Limited
Partners.

                  (b) To the extent applicable for federal income tax purposes,
the Partnership shall elect to deduct expenses incurred in organizing the
Partnership ratably over a sixty-month period as provided in Section 709 of the
Code.

                  (c) Except as otherwise provided herein, the General Partner
shall determine whether the Partnership should make any other elections
permitted by the Code.

                  Section 9.3 Tax Controversies. Subject to the provisions
hereof, the General Partner is designated as the Tax Matters Partner (as defined
in the Code) and is authorized and required to represent the Partnership (at the
Partnership's expense) in connection with all examinations of the Partnership's
affairs by tax authorities, including resulting administrative and judicial
proceedings, and to expend Partnership funds for professional services and costs
associated therewith. Each Partner agrees to cooperate with the General Partner
and to do or refrain from doing any or all things reasonably required by the
General Partner to conduct such proceedings.

                  Section 9.4 Withholding. Notwithstanding any other provision
of this Agreement, the General Partner is authorized to take any action that it
determines in its discretion to be necessary or appropriate to cause the
Partnership to comply with any withholding requirements established under the
Code or any other federal, state or local law including, without limitation,
pursuant to Sections 1441, 1442, 1445 and 1446 of the Code. To the extent that
the Partnership is required or elects to withhold and pay over to any taxing
authority any amount resulting from the allocation or distribution of income to
any Partner or Assignee (including, without limitation, by reason of Section
1446 of the Code), the amount withheld may at the discretion of the General
Partner be treated by the Partnership as a distribution of cash pursuant to
Section 6.3 in the amount of such withholding from such Partner.



                                       40
<PAGE>

                                   ARTICLE X
                             ADMISSION OF PARTNERS

                  Section 10.1 Admission of Partners. Upon the consummation of
the transfers and conveyances described in Section 5.2, the General Partner
shall be the sole general partner of the Partnership and the MLP shall be the
sole limited partner of the Partnership.

                  Section 10.2 Admission of Substituted Limited Partner. By
transfer of a Limited Partner Interest in accordance with Article IV, the
transferor shall be deemed to have given the transferee the right to seek
admission as a Substituted Limited Partner subject to the conditions of, and in
the manner permitted under, this Agreement. A transferor of a Limited Partner
Interest shall, however, only have the authority to convey to a purchaser or
other transferee (a) the right to negotiate such Limited Partner Interest to a
purchaser or other transferee and (b) the right to request admission as a
Substituted Limited Partner to such purchaser or other transferee in respect of
the transferred Limited Partner Interests. Each transferee of a Limited Partner
Interest shall be an Assignee and be deemed to have applied to become a
Substituted Limited Partner with respect to the Limited Partner Interests so
transferred to such Person. Such Assignee shall become a Substituted Limited
Partner (x) at such time as the General Partner consents thereto, which consent
may be given or withheld in the General Partner's discretion, and (y) when any
such admission is shown on the books and records of the Partnership. If such
consent is withheld, such transferee shall remain an Assignee. An Assignee shall
have an interest in the Partnership equivalent to that of a Limited Partner with
respect to allocations and distributions, including liquidating distributions,
of the Partnership. With respect to voting rights attributable to Limited
Partner Interests that are held by Assignees, the General Partner shall be
deemed to be the Limited Partner with respect thereto and shall, in exercising
the voting rights in respect of such Limited Partner Interests on any matter,
vote such Limited Partner Interests at the written direction of the Assignee. If
no such written direction is received, such Partnership Interests will not be
voted. An Assignee shall have no other rights of a Limited Partner.

                  Section 10.3 Admission of Additional Limited Partners.

                  (a) A Person (other than the General Partner, the MLP or a
Substituted Limited Partner) who makes a Capital Contribution to the Partnership
in accordance with this Agreement shall be admitted to the Partnership as an
Additional Limited Partner only upon furnishing to the General Partner:

                      (i) evidence of acceptance in form satisfactory to the
         General Partner of all of the terms and conditions of this Agreement,
         including the power of attorney granted in Section 2.6, and

                      (ii) such other documents or instruments as may be
         required in the discretion of the General Partner to effect such
         Person's admission as an Additional Limited Partner.

                  (b) Notwithstanding anything to the contrary in this Section
10.3, no Person shall be admitted as an Additional Limited Partner without the
consent of the General Partner, which consent may be given or withheld in the
General Partner's discretion. The admission of



                                       41
<PAGE>

any Person as an Additional Limited Partner shall become effective on the date
upon which the name of such Person is recorded as such in the books and records
of the Partnership, following the consent of the General Partner to such
admission.

                  Section 10.4 Admission of Successor or Transferee General
Partner. A successor General Partner approved pursuant to Section 11.1 or 11.2
or the transferee of or successor to all of the General Partner's Partnership
Interest pursuant to Section 4.2 who is proposed to be admitted as a successor
General Partner shall, subject to compliance with the terms of Section 11.3, if
applicable, be admitted to the Partnership as the General Partner, effective
immediately prior to the withdrawal or removal of the predecessor or
transferring General Partner pursuant to Section 11.1 or 11.2 or the transfer of
the General Partner Interest pursuant to Section 4.2, provided, however, that no
such successor shall be admitted to the Partnership until compliance with the
terms of Section 4.2 has occurred and such successor has executed and delivered
such other documents or instruments as may be required to effect such admission.
Any such successor shall, subject to the terms hereof, carry on the business of
the members of the Partnership Group without dissolution.

                  Section 10.5 Amendment of Agreement and Certificate of Limited
Partnership. To effect the admission to the Partnership of any Partner, the
General Partner shall take all steps necessary and appropriate under the
Delaware Act to amend the records of the Partnership to reflect such admission
and, if necessary, to prepare as soon as practicable an amendment to this
Agreement and, if required by law, the General Partner shall prepare and file an
amendment to the Certificate of Limited Partnership, and the General Partner may
for this purpose, among others, exercise the power of attorney granted pursuant
to Section 2.6.

                                   ARTICLE XI
                       WITHDRAWAL OR REMOVAL OF PARTNERS

                  Section 11.1 Withdrawal of the General Partner.

                  (a) The General Partner shall be deemed to have withdrawn from
the Partnership upon the occurrence of any one of the following events (each
such event herein referred to as an "Event of Withdrawal");

                      (i) The General Partner voluntarily withdraws from the
         Partnership by giving written notice to the other Partners;

                      (ii) The General Partner transfers all of its rights as
         General Partner pursuant to Section 4.2;

                      (iii) The General Partner is removed pursuant to Section
         11.2;

                      (iv) The General Partner (A) makes a general assignment
         for the benefit of creditors; (B) files a voluntary bankruptcy petition
         for relief under Chapter 7 of the United States Bankruptcy Code; (C)
         files a petition or answer seeking for itself a liquidation,
         dissolution or similar relief (but not a reorganization) under any law;
         (D) files an answer or other pleading admitting or failing to contest
         the material allegations of a





                                       42
<PAGE>

         petition filed against the General Partner in a proceeding of the type
         described in clauses (A)-(C) of this Section 11.1(a)(iv); or (E) seeks,
         consents to or acquiesces in the appointment of a trustee (but not a
         debtor-in-possession), receiver or liquidator of the General Partner or
         of all or any substantial part of its properties;

                      (v) A final and non-appealable order of relief under
         Chapter 7 of the United States Bankruptcy Code is entered by a court
         with appropriate jurisdiction pursuant to a voluntary or involuntary
         petition by or against the General Partner; or

                      (vi) (A) in the event the General Partner is a
         corporation, a certificate of dissolution or its equivalent is filed
         for the General Partner, or 90 days expire after the date of notice to
         the General Partner of revocation of its charter without a
         reinstatement of its charter, under the laws of its state of
         incorporation; (B) in the event the General Partner is a partnership or
         limited liability company, the dissolution and commencement of winding
         up of the General Partner; (C) in the event the General Partner is
         acting in such capacity by virtue of being a trustee of a trust, the
         termination of the trust; (D) in the event the General Partner is a
         natural person, his death or adjudication of incompetency; and (E)
         otherwise in the event of the termination of the General Partner.

         If an Event of Withdrawal specified in Section 11.1(a)(iv), (v) or
(vi)(A), (B), (C) or (E) occurs, the withdrawing General Partner shall give
notice to the Limited Partners within 30 days after such occurrence. The
Partners hereby agree that only the Events of Withdrawal described in this
Section 11.1 shall result in the withdrawal of the General Partner from the
Partnership.

                  (b) Withdrawal of the General Partner from the Partnership
upon the occurrence of an Event of Withdrawal shall not constitute a breach of
this Agreement under the following circumstances: (i) at any time during the
period beginning on the Closing Date and ending at 12:00 midnight, Eastern
Standard Time, on September 30, 2012, the General Partner voluntarily withdraws
by giving at least 90 days' advance notice of its intention to withdraw to the
Limited Partners; provided that prior to the effective date of such withdrawal,
the withdrawal is approved by the Limited Partners and the General Partner
delivers to the Partnership an Opinion of Counsel ("Withdrawal Opinion of
Counsel") that such withdrawal (following the selection of the successor General
Partner) would not result in the loss of the limited liability of any Limited
Partner or of the limited partners of the MLP or cause the Partnership or the
MLP to be treated as an association taxable as a corporation or otherwise to be
taxed as an entity for federal income tax purposes (to the extent not previously
treated as such); (ii) at any time after 12:00 midnight, Eastern Standard Time,
on September 30, 2012, the General Partner voluntarily withdraws by giving at
least 90 days' advance notice to the Limited Partners, such withdrawal to take
effect on the date specified in such notice; (iii) at any time that the General
Partner ceases to be the General Partner pursuant to Section 11.1(a)(ii) or
(iii). If the General Partner gives a notice of withdrawal pursuant to Section
11.1(a)(i) hereof, the Limited Partners may, prior to the effective date of such
withdrawal, elect a successor General Partner. If, prior to the effective date
of the General Partner's withdrawal, a successor is not selected by the Limited
Partners as provided herein or the Partnership does not receive a Withdrawal
Opinion of Counsel, the Partnership shall be dissolved in accordance with
Section 12.1. Any successor General Partner





                                       43
<PAGE>

elected in accordance with the terms of this Section 11.1 shall be subject to
the provisions of Section 10.3.

                  Section 11.2 Removal of the General Partner. The General
Partner may be removed by the MLP. Upon the removal of the General Partner by
the MLP, the MLP shall elect a successor general partner for the Partnership.
The admission of any such successor General Partner to the Partnership shall be
subject to the provisions of Section 10.3.

                  Section 11.3 Interest of Departing Partner.

                  (a) The Partnership Interest of the Departing Partner
departing as a result of withdrawal or removal pursuant to Section 11.1 or 11.2
shall be purchased by the successor to the Departing Partner for an amount in
cash equal to the fair market value of such Partnership Interest, such amount to
be determined and payable as of the effective date of the Departing Partner's
departure. Such purchase shall be a condition to the admission to the
Partnership of the successor as the General Partner. Any successor General
Partner shall indemnify the Departing Partner as to all debts and liabilities of
the Partnership arising on or after the effective date of the withdrawal or
removal of the Departing Partner.

                  For purposes of this Section 11.3(a), the fair market value of
the Departing Partner's General Partner Interest shall be determined by
agreement between the Departing Partner and its successor or, failing agreement
within 30 days after the effective date of such Departing Partner's departure,
by an independent investment banking firm or other independent expert selected
by the Departing Partner and its successor, which, in turn, may rely on other
experts, and the determination of which shall be conclusive as to such matter.
If such parties cannot agree upon one independent investment banking firm or
other independent expert within 45 days after the effective date of such
departure, then the Departing Partner shall designate an independent investment
banking firm or other independent expert, the Departing Partner's successor
shall designate an independent investment banking firm or other independent
expert, and such firms or experts shall mutually select a third independent
investment banking firm or independent expert, which third independent
investment banking firm or other independent expert shall determine the fair
market value of the General Partner Interest of the Departing Partner. In making
its determination, such third independent investment banking firm or other
independent expert may consider the value of the Partnership's assets, the
rights and obligations of the Departing Partner and other factors it may deem
relevant.

                  (b) The Departing Partner shall be entitled to receive all
reimbursements due such Departing Partner pursuant to Section 7.4, including any
employee-related liabilities (including severance liabilities), incurred in
connection with the termination of any employees employed by such Departing
Partner for the benefit of the Partnership.

                  Section 11.4 Withdrawal of a Limited Partner. Without the
prior written consent of the General Partner, which may be granted or withheld
in its sole discretion, and except as provided in Section 10.1, no Limited
Partner shall have the right to withdraw from the Partnership.



                                       44
<PAGE>

                                  ARTICLE XII
                           DISSOLUTION AND LIQUIDATION

                  Section 12.1 Dissolution. The Partnership shall not be
dissolved by the admission of Substituted Limited Partners or Additional Limited
Partners or by the admission of a successor General Partner in accordance with
the terms of this Agreement. Upon the removal or withdrawal of the General
Partner, if a successor General Partner is elected pursuant to Section 11.1 or
11.2, the Partnership shall not be dissolved and such successor General Partner
shall continue the business of the Partnership. The Partnership shall dissolve,
and (subject to Section 12.2) its affairs shall be wound up, upon:

                  (a) an Event of Withdrawal of the General Partner as provided
in Section 11.1(a) (other than Section 11.1(a)(ii)), unless a successor is
elected and an Opinion of Counsel is received as provided in Section 11.1(b) or
11.2 and such successor is admitted to the Partnership pursuant to Section 10.4;

                  (b) an election to dissolve the Partnership by the General
Partner that is approved by all of the Limited Partners;

                  (c) the entry of a decree of judicial dissolution of the
Partnership pursuant to the provisions of the Delaware Act;

                  (d) the sale of all or substantially all of the assets and
properties of the Partnership Group; or

                  (e) the dissolution of the MLP.

                  Section 12.2 Continuation of the Business of the Partnership
After Dissolution. Upon dissolution of the Partnership following an Event of
Withdrawal caused by the withdrawal or removal of the General Partner as
provided in Section 11.1(a)(i) or (iii) and the failure of the Partners to
select a successor to such Departing Partner pursuant to Section 11.1 or 11.2,
then within 90 days thereafter, all of the Limited Partners may elect to
reconstitute the Partnership and continue its business on the same terms and
conditions set forth in this Agreement by forming a new limited partnership on
terms identical to those set forth in this Agreement and having as a general
partner a Person approved by a majority in interest of the Limited Partners. In
addition, upon dissolution of the Partnership pursuant to Section 12.1(e), if
the MLP is reconstituted pursuant to Section 12.2 of the MLP Agreement, the
reconstituted MLP may, within 180 days after such event of dissolution, acting
alone, regardless of whether there are any other Limited Partners, elect to
reconstitute the Partnership in accordance with the immediately preceding
sentence. Upon any such election by the Limited Partners or the MLP, as the case
may be, all Partners shall be bound thereby and shall be deemed to have approved
same. Unless such an election is made within the applicable time period as set
forth above, the Partnership shall conduct only activities necessary to wind up
its affairs. If such an election is so made, then:

                  (a) the reconstituted Partnership shall continue unless
earlier dissolved in accordance with this Article XII;



                                       45
<PAGE>

                  (b) if the successor General Partner is not the former General
Partner, then the interest of the former General Partner shall be purchased by
the successor General Partner; and

                  (c) all necessary steps shall be taken to cancel this
Agreement and the Certificate of Limited Partnership and to enter into and, as
necessary, to file, a new partnership agreement and certificate of limited
partnership, and the successor General Partner may for this purpose exercise the
powers of attorney granted the General Partner pursuant to Section 2.6;
provided, that the right to approve a successor General Partner and to
reconstitute and to continue the business of the Partnership shall not exist and
may not be exercised unless the Partnership has received an Opinion of Counsel
that (x) the exercise of the right would not result in the loss of limited
liability of the Limited Partners or any limited partner of the MLP and (y)
neither the Partnership, the reconstituted limited partnership, the MLP nor any
Group Member would be treated as an association taxable as a corporation or
otherwise be taxable as an entity for federal income tax purposes upon the
exercise of such right to continue.

                  Section 12.3 Liquidator. Upon dissolution of the Partnership,
unless the Partnership is continued under an election to reconstitute and
continue the Partnership pursuant to Section 12.2, the General Partner shall
select one or more Persons to act as Liquidator. The Liquidator (if other than
the General Partner) shall be entitled to receive such compensation for its
services as may be approved by a majority of the Limited Partners. The
Liquidator (if other than the General Partner) shall agree not to resign at any
time without 15 days' prior notice and may be removed at any time, with or
without cause, by notice of removal approved by a majority in interest of the
Limited Partners. Upon dissolution, removal or resignation of the Liquidator, a
successor and substitute Liquidator (who shall have and succeed to all rights,
powers and duties of the original Liquidator) shall within 30 days thereafter be
approved by at least a majority in interest of the Limited Partners. The right
to approve a successor or substitute Liquidator in the manner provided herein
shall be deemed to refer also to any such successor or substitute Liquidator
approved in the manner herein provided. Except as expressly provided in this
Article XII, the Liquidator approved in the manner provided herein shall have
and may exercise, without further authorization or consent of any of the parties
hereto, all of the powers conferred upon the General Partner under the terms of
this Agreement (but subject to all of the applicable limitations, contractual
and otherwise, upon the exercise of such powers, other than the limitation on
sale set forth in Section 7.3(b)) to the extent necessary or desirable in the
good faith judgment of the Liquidator to carry out the duties and functions of
the Liquidator hereunder for and during such period of time as shall be
reasonably required in the good faith judgment of the Liquidator to complete the
winding up and liquidation of the Partnership as provided for herein.

                  Section 12.4 Liquidation. The Liquidator shall proceed to
dispose of the assets of the Partnership, discharge its liabilities, and
otherwise wind up its affairs in such manner and over such period as the
Liquidator determines to be in the best interest of the Partners, subject to
Section 17-804 of the Delaware Act and the following:

                  (a) Disposition of Assets. The assets may be disposed of by
public or private sale or by distribution in kind to one or more Partners on
such terms as the Liquidator and such Partner or Partners may agree. If any
property is distributed in kind, the Partner receiving the property shall be
deemed for purposes of Section 12.4(c) to have received cash equal to its fair
market value; and contemporaneously therewith, appropriate cash distributions
must be made to




                                       46
<PAGE>

the other Partners. The Liquidator may, in its absolute discretion, defer
liquidation or distribution of the Partnership's assets for a reasonable time if
it determines that an immediate sale or distribution of all or some of the
Partnership's assets would be impractical or would cause undue loss to the
Partners. The Liquidator may, in its absolute discretion, distribute the
Partnership's assets, in whole or in part, in kind if it determines that a sale
would be impractical or would cause undue loss to the Partners.

                  (b) Discharge of Liabilities. Liabilities of the Partnership
include amounts owed to the Liquidator as compensation for serving in such
capacity (subject to the terms of Section 12.3) and amounts owed to Partners
otherwise than in respect of their distribution rights under Article VI. With
respect to any liability that is contingent, conditional or unmatured or is
otherwise not yet due and payable, the Liquidator shall either settle such claim
for such amount as it thinks appropriate or establish a reserve of cash or other
assets to provide for its payment. When paid, any unused portion of the reserve
shall be distributed as additional liquidation proceeds.

                  (c) Liquidation Distributions. All property and all cash in
excess of that required to discharge liabilities as provided in Section 12.4(b)
shall be distributed to the Partners in accordance with, and to the extent of,
the positive balances in their respective Capital Accounts, as determined after
taking into account all Capital Account adjustments (other than those made by
reason of distributions pursuant to this Section 12.4(c)) for the taxable year
of the Partnership during which the liquidation of the Partnership occurs (with
such date of occurrence being determined pursuant to Treasury Regulation Section
1.704-1(b)(2)(ii)(g)), and such distribution shall be made by the end of such
taxable year (or, if later, within 90 days after said date of such occurrence).

                  Section 12.5 Cancellation of Certificate of Limited
Partnership. Upon the completion of the distribution of Partnership cash and
property as provided in Section 12.4 in connection with the liquidation of the
Partnership, the Partnership shall be terminated and the Certificate of Limited
Partnership, and all qualifications of the Partnership as a foreign limited
partnership in jurisdictions other than the State of Delaware, shall be canceled
and such other actions as may be necessary to terminate the Partnership shall be
taken.

                  Section 12.6 Return of Contributions. The General Partner
shall not be personally liable for, and shall have no obligation to contribute
or loan any monies or property to the Partnership to enable it to effectuate,
the return of the Capital Contributions of the Limited Partners, or any portion
thereof, it being expressly understood that any such return shall be made solely
from Partnership assets.

                  Section 12.7 Waiver of Partition. To the maximum extent
permitted by law, each Partner hereby waives any right to partition of the
Partnership property.

                  Section 12.8 Capital Account Restoration. No Limited Partner
shall have any obligation to restore any negative balance in its Capital Account
upon liquidation of the Partnership. The General Partner shall be obligated to
restore any negative balance in its Capital Account upon liquidation of its
interest in the Partnership by the end of the taxable year of the




                                       47
<PAGE>

Partnership during which such liquidation occurs, or, if later, within 90 days
after the date of such liquidation.

                                  ARTICLE XIII
                       AMENDMENT OF PARTNERSHIP AGREEMENT

                  Section 13.1 Amendment to be Adopted Solely by the General
Partner. Each Partner agrees that the General Partner, without the approval of
any Partner or Assignee, may amend any provision of this Agreement and execute,
swear to, acknowledge, deliver, file and record whatever documents may be
required in connection therewith, to reflect:

                  (a) a change in the name of the Partnership, the location of
the principal place of business of the Partnership, the registered agent of the
Partnership or the registered office of the Partnership;

                  (b) admission, substitution, withdrawal or removal of Partners
in accordance with this Agreement;

                  (c) a change that, in the sole discretion of the General
Partner, is necessary or advisable to qualify or continue the qualification of
the Partnership as a limited partnership or a partnership in which the Limited
Partners have limited liability under the laws of any state or to ensure that no
Group Member will be treated as an association taxable as a corporation or
otherwise taxed as an entity for federal income tax purposes;

                  (d) a change that, in the discretion of the General Partner,
(i) does not adversely affect the Limited Partners (including any particular
class of Partnership Interests as compared to other classes of Partnership
Interests) in any material respect, (ii) is necessary or advisable to (A)
satisfy any requirements, conditions or guidelines contained in any opinion,
directive, order, ruling or regulation of any federal or state agency or
judicial authority or contained in any federal or state statute (including the
Delaware Act) or (B) facilitate the trading of limited partner interests of the
MLP (including the division of any class or classes of outstanding limited
partner interests of the MLP into different classes to facilitate uniformity of
tax consequences within such classes of limited partner interests of the MLP) or
comply with any rule, regulation, guideline or requirement of any National
Securities Exchange on which such limited partner interests are or will be
listed for trading, compliance with any of which the General Partner determines
in its discretion to be in the best interests of the MLP and the limited
partners of the MLP, (iii) is required to effect the intent expressed in the
Registration Statement or the intent of the provisions of this Agreement or is
otherwise contemplated by this Agreement or (iv) is required to conform the
provisions of this Agreement with the provisions of the MLP Agreement as the
provisions of the MLP Agreement may be amended, supplemented or restated from
time to time;

                  (e) a change in the fiscal year or taxable year of the
Partnership and any changes that, in the discretion of the General Partner, are
necessary or advisable as a result of a change in the fiscal year or taxable
year of the Partnership including, if the General Partner shall so determine, a
change in the definition of "Quarter" and the dates on which distributions are
to be made by the Partnership;



                                       48
<PAGE>

                  (f) an amendment that is necessary, in the Opinion of Counsel,
to prevent the Partnership, or the General Partner or its members, directors,
officers, trustees or agents from in any manner being subjected to the
provisions of the Investment Company Act of 1940, as amended, the Investment
Advisers Act of 1940, as amended, or "plan asset" regulations adopted under the
Employee Retirement Income Security Act of 1974, as amended, regardless of
whether such are substantially similar to plan asset regulations currently
applied or proposed by the United States Department of Labor;

                  (g) any amendment expressly permitted in this Agreement to be
made by the General Partner acting alone;

                  (h) an amendment effected, necessitated or contemplated by a
Merger Agreement approved in accordance with Section 14.3;

                  (i) an amendment that, in the discretion of the General
Partner, is necessary or advisable to reflect, account for and deal with
appropriately the formation by the Partnership of, or investment by the
Partnership in, any corporation, partnership, joint venture, limited liability
company or other entity, in connection with the conduct by the Partnership of
activities permitted by the terms of Section 2.4;

                  (j) a merger or conveyance pursuant to Section 14.3(d); or

                  (k) any other amendments substantially similar to the
foregoing.

                  Section 13.2 Amendment Procedures. Except with respect to
amendments of the type described in Section 13.1, all amendments to this
Agreement shall be made in accordance with the following requirements:
Amendments to this Agreement may be proposed only by or with the consent of the
General Partner, which consent may be given or withheld in its sole discretion.
A proposed amendment shall be effective upon its approval by the Limited
Partners.

                                  ARTICLE XIV
                                     MERGER

                  Section 14.1 Authority. The Partnership may merge or
consolidate with one or more corporations, limited liability companies, business
trusts or associations, real estate investment trusts, common law trusts or
unincorporated businesses, including a general partnership or limited
partnership, formed under the laws of the State of Delaware or any other state
of the United States of America, pursuant to a written agreement of merger or
consolidation ("Merger Agreement") in accordance with this Article XIV.

                  Section 14.2 Procedure for Merger or Consolidation. Merger or
consolidation of the Partnership pursuant to this Article XIV requires the prior
approval of the General Partner. If the General Partner shall determine, in the
exercise of its discretion, to consent to the merger or consolidation, the
General Partner shall approve the Merger Agreement, which shall set forth:



                                       49
<PAGE>

                  (a) the names and jurisdictions of formation or organization
of each of the business entities proposing to merge or consolidate;


                  (b) the name and jurisdiction of formation or organization of
the business entity that is to survive the proposed merger or consolidation (the
"Surviving Business Entity");

                  (c) the terms and conditions of the proposed merger or
consolidation;

                  (d) the manner and basis of exchanging or converting the
equity securities of each constituent business entity for, or into, cash,
property or general or limited partner interests, rights, securities or
obligations of the Surviving Business Entity; and (i) if any general or limited
partner interests, securities or rights of any constituent business entity are
not to be exchanged or converted solely for, or into, cash, property or general
or limited partner interests, rights, securities or obligations of the Surviving
Business Entity, the cash, property or general or limited partner interests,
rights, securities or obligations of any limited partnership, corporation, trust
or other entity (other than the Surviving Business Entity) that the holders of
such general or limited partner interests, securities or rights are to receive
in exchange for, or upon conversion of their general or limited partner
interests, securities or rights, and (ii) in the case of securities represented
by certificates, upon the surrender of such certificates, which cash, property
or general or limited partner interests, rights, securities or obligations of
the Surviving Business Entity or any general or limited partnership,
corporation, trust or other entity (other than the Surviving Business Entity),
or evidences thereof, are to be delivered;

                  (e) a statement of any changes in the constituent documents or
the adoption of new constituent documents (the articles or certificate of
incorporation, articles of trust, declaration of trust, certificate or agreement
of limited partnership or other similar charter or governing document) of the
Surviving Business Entity to be effected by such merger or consolidation;

                  (f) the effective time of the merger, which may be the date of
the filing of the certificate of merger pursuant to Section 14.4 or a later date
specified in or determinable in accordance with the Merger Agreement (provided,
that if the effective time of the merger is to be later than the date of the
filing of the certificate of merger, the effective time shall be fixed no later
than the time of the filing of the certificate of merger and stated therein);
and

                  (g) such other provisions with respect to the proposed merger
or consolidation as are deemed necessary or appropriate by the General Partner.

                  Section 14.3 Approval by Limited Partners of Merger or
Consolidation.

                  (a) Except as provided in Section 14.3(d), the General
Partner, upon its approval of the Merger Agreement, shall direct that the Merger
Agreement be submitted to a vote of the Limited Partners, whether at a special
meeting or by written consent, in either case in accordance with the
requirements of Article XIII. A copy or a summary of the Merger Agreement shall
be included in or enclosed with the notice of a special meeting or the written
consent.



                                       50
<PAGE>

                  (b) Except as provided in Section 14.3(d), the Merger
Agreement shall be approved upon receiving the affirmative vote or consent of
the Limited Partners.

                  (c) Except as provided in Section 14.3(d), after such approval
by vote or consent of the Limited Partners, and at any time prior to the filing
of the certificate of merger pursuant to Section 14.4, the merger or
consolidation may be abandoned pursuant to provisions therefor, if any, set
forth in the Merger Agreement.

                  (d) Notwithstanding anything else contained in this Article
XIV or in this Agreement, the General Partner is permitted, in its discretion,
without Limited Partner approval, to merge the Partnership or any Group Member
into, or convey all of the Partnership's assets to, another limited liability
entity that shall be newly formed and shall have no assets, liabilities or
operations at the time of such Merger other than those it receives from the
Partnership or other Group Member if (i) the General Partner has received an
Opinion of Counsel that the merger or conveyance, as the case may be, would not
result in the loss of the limited liability of any Limited Partner or any
limited partner in the MLP or cause the Partnership or the MLP to be treated as
an association taxable as a corporation or otherwise to be taxed as an entity
for federal income tax purposes (to the extent not previously treated as such),
(ii) the sole purpose of such merger or conveyance is to effect a mere change in
the legal form of the Partnership into another limited liability entity and
(iii) the governing instruments of the new entity provide the Limited Partners
and the General Partner with substantially the same rights and obligations as
are herein contained.

                  Section 14.4 Certificate of Merger. Upon the required approval
by the General Partner and the Limited Partners of a Merger Agreement, a
certificate of merger shall be executed and filed with the Secretary of State of
the State of Delaware in conformity with the requirements of the Delaware Act.

                  Section 14.5 Effect of Merger.

                  (a) At the effective time of the certificate of merger:

                      (i) all of the rights, privileges and powers of each of
         the business entities that has merged or consolidated, and all
         property, real, personal and mixed, and all debts due to any of those
         business entities and all other things and causes of action belonging
         to each of those business entities, shall be vested in the Surviving
         Business Entity and after the merger or consolidation shall be the
         property of the Surviving Business Entity to the extent they were of
         each constituent business entity;

                      (ii) the title to any real property vested by deed or
         otherwise in any of those constituent business entities shall not
         revert and is not in any way impaired because of the merger or
         consolidation;

                      (iii) all rights of creditors and all liens on or security
         interests in property of any of those constituent business entities
         shall be preserved unimpaired; and



                                       51
<PAGE>

                      (iv) all debts, liabilities and duties of those
         constituent business entities shall attach to the Surviving Business
         Entity and may be enforced against it to the same extent as if the
         debts, liabilities and duties had been incurred or contracted by it.

                  (b) A merger or consolidation effected pursuant to this
Article shall not be deemed to result in a transfer or assignment of assets or
liabilities from one entity to another.

                                   ARTICLE XV
                               GENERAL PROVISIONS

                  Section 15.1 Addresses and Notices. Any notice, demand,
request, report or proxy materials required or permitted to be given or made to
a Partner or Assignee under this Agreement shall be in writing and shall be
deemed given or made when delivered in person or when sent by first class United
States mail or by other means of written communication to the Partner or
Assignee at the address appearing on the books and records of the Partnership.
Any notice to the Partnership shall be deemed given if received by the General
Partner at the principal office of the Partnership designated pursuant to
Section 2.3. The General Partner may rely and shall be protected in relying on
any notice or other document from a Partner, Assignee or other Person if
believed by it to be genuine.

                  Section 15.2 Further Action. The parties shall execute and
deliver all documents, provide all information and take or refrain from taking
action as may be necessary or appropriate to achieve the purposes of this
Agreement.

                  Section 15.3 Binding Effect. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their heirs, executors,
administrators, successors, legal representatives and permitted assigns.

                  Section 15.4 Integration. This Agreement constitutes the
entire agreement among the parties hereto pertaining to the subject matter
hereof and supersedes all prior agreements and understandings pertaining
thereto.

                  Section 15.5 Creditors. None of the provisions of this
Agreement shall be for the benefit of, or shall be enforceable by, any creditor
of the Partnership.

                  Section 15.6 Waiver. No failure by any party to insist upon
the strict performance of any covenant, duty, agreement or condition of this
Agreement or to exercise any right or remedy consequent upon a breach thereof
shall constitute waiver of any breach of any other covenant, duty, agreement or
condition.

                  Section 15.7 Counterparts. This Agreement may be executed in
counterparts, all of which together shall constitute an agreement binding on all
the parties hereto, notwithstanding that all such parties are not signatories to
the original or the same counterpart. Each party shall become bound by this
Agreement immediately upon affixing its signature hereto, independently of the
signature of any other party.



                                       52
<PAGE>

                  Section 15.8 Applicable Law. This Agreement shall be construed
in accordance with and governed by the laws of the State of Delaware, without
regard to the principles of conflicts of law.

                  Section 15.9 Invalidity of Provisions. If any provision of
this Agreement is or becomes invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining provisions contained
herein shall not be affected thereby.

                  Section 15.10 Consent of Partners. Each Partner hereby
expressly consents and agrees that, whenever in this Agreement it is specified
that an action may be taken upon the affirmative vote or consent of less than
all of the Partners, such action may be so taken upon the concurrence of less
than all of the Partners and each Partner shall be bound by the results of such
action.

                  [Remainder of Page Intentionally Left Blank]



                                       53
<PAGE>


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

                                GENERAL PARTNER:

                                MARTIN OPERATING GP LLC

                                By:   Martin Midstream Partners, L.P.
                                      Its:  Managing Member

                                By:   Martin Midstream GP LLC
                                      Its:  General Partner


                                      By: /s/ Robert D. Bondurant
                                          --------------------------------------
                                          Robert D. Bondurant
                                          Chief Financial Officer


                                LIMITED PARTNER:

                                MARTIN MIDSTREAM PARTNERS L.P.

                                By:   Martin Midstream GP LLC
                                      Its General Partner


                                      By: /s/ Robert D. Bondurant
                                          --------------------------------------
                                          Robert D. Bondurant
                                          Chief Financial Officer





                                       54






</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>6
<FILENAME>d00990exv10w1.txt
<DESCRIPTION>CREDIT AGREEMENT
<TEXT>
<PAGE>
                                                                    EXHIBIT 10.1

                                                                  EXECUTION COPY

================================================================================



                       MARTIN OPERATING PARTNERSHIP L.P.,
                                as the Borrower,


                         MARTIN MIDSTREAM PARTNERS L.P.,
                                 as a Guarantor


                              ROYAL BANK OF CANADA,
                  as Administrative Agent and Collateral Agent

                              COMERICA BANK-TEXAS,
                                   as Co-Agent

                                       and

                            The Lenders Party Hereto


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



                                   $60,000,000
                                CREDIT AGREEMENT

                          DATED AS OF NOVEMBER 6, 2002



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



                              ROYAL BANK OF CANADA,
                        as Lead Arranger and Book Runner



================================================================================


[MARTIN MIDSTREAM PARTNERS LOGO]                     [ROYAL BANK OF CANADA LOGO]



<PAGE>
                                TABLE OF CONTENTS


<Table>
<Caption>
                                                                                                                Page
                                                                                                                ----
<S>                                                                                                             <C>
ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS.......................................................................1
         Section 1.01 Defined Terms...............................................................................1
         Section 1.02 Other Interpretive Provisions..............................................................30
         Section 1.03 Accounting Terms...........................................................................31
         Section 1.04 Rounding...................................................................................31
         Section 1.05 References to Agreements and Laws..........................................................31

ARTICLE II. THE COMMITMENTS AND BORROWINGS.......................................................................31
         Section 2.01 Revolver Loans.............................................................................31
         Section 2.02 Term Loan Facility.........................................................................32
         Section 2.03 Borrowings, Conversions and Continuations of Loans.........................................32
         Section 2.04 Prepayments................................................................................33
         Section 2.05 Reduction or Termination of Commitments....................................................36
         Section 2.06 Repayment of Loans.........................................................................37
         Section 2.07 Interest...................................................................................37
         Section 2.08 Fees.......................................................................................37
         Section 2.09 Computation of Interest and Fees...........................................................38
         Section 2.10 Evidence of Debt...........................................................................38
         Section 2.11 Payments Generally.........................................................................39
         Section 2.12 Sharing of Payments........................................................................40
         Section 2.13 Priority of Hedging Obligations............................................................41
         Section 2.14 Letters of Credit..........................................................................41
         Section 2.15 Swing Line Loans...........................................................................47

ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY..............................................................49
         Section 3.01 Taxes......................................................................................49
         Section 3.02 Illegality.................................................................................50
         Section 3.03 Inability to Determine Rates...............................................................51
         Section 3.04 Increased Cost and Reduced Return; Capital Adequacy; Reserves on Eurodollar Rate Loans.....51
         Section 3.05 Funding Losses.............................................................................52
         Section 3.06 Matters Applicable to all Requests for Compensation........................................52
         Section 3.07 Survival...................................................................................52

ARTICLE IV. CONDITIONS PRECEDENT TO BORROWINGS...................................................................52
         Section 4.01 Conditions to Initial Credit Extension.....................................................52
         Section 4.02 Deadline for Conditions Effective Date.....................................................55
         Section 4.03 Conditions to all Loans and L/C Credit Extension...........................................55

ARTICLE V. REPRESENTATIONS AND WARRANTIES........................................................................56
         Section 5.01 Existence; Qualification and Power; Compliance with Laws...................................56
         Section 5.02 Authorization; No Contravention............................................................56
         Section 5.03 Governmental Authorization.................................................................57
         Section 5.04 Binding Effect.............................................................................57
         Section 5.05 Financial Statements; No Material Adverse Effect...........................................57
</Table>



                                        i
<PAGE>


<Table>
<S>                                                                                                              <C>
         Section 5.06 Litigation.................................................................................57
         Section 5.07 No Default.................................................................................57
         Section 5.08 Ownership of Property; Liens...............................................................57
         Section 5.09 Environmental Compliance...................................................................58
         Section 5.10 Insurance..................................................................................58
         Section 5.11 Taxes......................................................................................58
         Section 5.12 ERISA Compliance...........................................................................58
         Section 5.13 Subsidiaries and other Investments.........................................................59
         Section 5.14 Margin Regulations; Investment Company Act; Public Utility Holding Company Act;
                      Use of Proceeds............................................................................59
         Section 5.15 Disclosure.................................................................................59
         Section 5.16 Labor Matters..............................................................................59
         Section 5.17 Compliance with Laws.......................................................................59
         Section 5.18 Third Party Approvals......................................................................60
         Section 5.19 Solvency...................................................................................60
         Section 5.20 Collateral.................................................................................60
         Section 5.21 Concerning the Vessels.....................................................................60
         Section 5.22 Intellectual Property; Licenses, etc.......................................................61

ARTICLE VI. AFFIRMATIVE COVENANTS................................................................................61
         Section 6.01 Financial Statements.......................................................................61
         Section 6.02 Certificates; Other Information............................................................62
         Section 6.03 Notices....................................................................................63
         Section 6.04 Payment of Obligations.....................................................................63
         Section 6.05 Preservation of Existence, Etc.............................................................63
         Section 6.06 Maintenance of Assets and Business.........................................................64
         Section 6.07 Maintenance of Insurance...................................................................64
         Section 6.08 Compliance with Laws and Contractual Obligations...........................................64
         Section 6.09 Books and Records..........................................................................64
         Section 6.10 Inspection Rights..........................................................................64
         Section 6.11 Compliance with ERISA......................................................................65
         Section 6.12 Use of Proceeds............................................................................65
         Section 6.13 Material Agreements........................................................................65
         Section 6.14 Concerning the Vessels.....................................................................65
         Section 6.15 Guaranties.................................................................................66
         Section 6.16 Company Identity...........................................................................66
         Section 6.17 Vessel Mortgages...........................................................................66
         Section 6.18 Further Assurances; Additional Collateral..................................................66

ARTICLE VII. NEGATIVE COVENANTS..................................................................................67
         Section 7.01 Liens......................................................................................67
         Section 7.02 Investments and Acquisitions...............................................................69
         Section 7.03 Hedging Agreements.........................................................................70
         Section 7.04 Indebtedness...............................................................................70
         Section 7.05 Lease Obligations..........................................................................70
         Section 7.06 Fundamental Changes........................................................................70
         Section 7.07 Dispositions...............................................................................71
         Section 7.08 Restricted Payments; Distributions and Redemptions.........................................71
         Section 7.09 ERISA......................................................................................72
         Section 7.10 Nature of Business; Capital Expenditures...................................................72
         Section 7.11 Transactions with Affiliates...............................................................72
</Table>



                                       ii
<PAGE>


<Table>
<S>                                                                                                             <C>
         Section 7.12 Burdensome Agreements......................................................................72
         Section 7.13 Use of Proceeds............................................................................72
         Section 7.14 Amendments to Material Agreements; Amendment to Omnibus Agreement Administrative Fee.......72
         Section 7.15 Financial Covenants........................................................................73
         Section 7.16 Capital Expenditures.......................................................................73
         Section 7.17 Subordinated Indebtedness..................................................................74

ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES.....................................................................74
         Section 8.01 Events of Default..........................................................................74
         Section 8.02 Remedies Upon Event of Default.............................................................76

ARTICLE IX. AGENTS...............................................................................................77
         Section 9.01 Appointment and Authorization of Administrative Agent and Collateral Agent;
                      Lender Hedging Agreements..................................................................77
         Section 9.02 Delegation of Duties.......................................................................78
         Section 9.03 Default; Master Consent to Assignment......................................................78
         Section 9.04 Liability of Administrative Agent..........................................................80
         Section 9.05 Reliance by Administrative Agent...........................................................80
         Section 9.06 Notice of Default..........................................................................81
         Section 9.07 Credit Decision; Disclosure of Information by Administrative Agent.........................81
         Section 9.08 Indemnification of Administrative Agent and the Collateral Agent...........................81
         Section 9.09 Administrative Agent and Collateral Agent in their Individual Capacities...................82
         Section 9.10 Successor Agents...........................................................................82
         Section 9.11 Other Agents; Lead Managers................................................................83

ARTICLE X. MISCELLANEOUS.........................................................................................83
         Section 10.01     Amendments, Release of Collateral, Etc................................................83
         Section 10.02     Notices and Other Communications; Facsimile Copies....................................85
         Section 10.03     No Waiver; Cumulative Remedies........................................................86
         Section 10.04     Attorney Costs; Expenses and Taxes....................................................86
         Section 10.05     Indemnification.......................................................................87
         Section 10.06     Payments Set Aside....................................................................88
         Section 10.07     Successors and Assigns................................................................88
         Section 10.08     Confidentiality.......................................................................90
         Section 10.09     Set-off...............................................................................91
         Section 10.10     Interest Rate Limitation..............................................................91
         Section 10.11     Counterparts..........................................................................92
         Section 10.12     Integration...........................................................................92
         Section 10.13     Survival of Representations and Warranties............................................92
         Section 10.14     Severability..........................................................................92
         Section 10.15     Foreign Lenders.......................................................................92
         Section 10.16     Governing Law.........................................................................93
         Section 10.17     Waiver of Right to Trial by Jury, Etc.................................................94
         Section 10.18     Master Consent to Assignment..........................................................94
         Section 10.19     Entire Agreement......................................................................94

         SIGNATURES.............................................................................................S-1
</Table>



                                      iii
<PAGE>



SCHEDULES

          1.01(a)     Description of Assumed Indebtedness
          1.01(b)     Designated Martin Shareholders
          1.01(c)     Stanolind Terminal Agreements
          2.01        Commitments
          5.13        Subsidiaries and other Equity Investments
          5.21        Vessels
          7.01        Existing Liens
          10.02       Addresses for Notices to Borrower, Guarantors,
                      Administrative Agent, and Collateral Agent

EXHIBITS

         Exhibit:     Form of:

         A-1          Committed Loan Notice
         A-2          Conversion/Continuation Notice
         B-1          Revolver Note
         B-2          Term Note
         C            Compliance Certificate pursuant to Section 6.02(a)
         D            Assignment and Assumption
         E-1          Subsidiary Guaranty
         E-2          Guaranty (MLP)
         F-1          Legal Opinion of Baker Botts L.L.P.
         F-2          Post-Closing Legal Opinion of Baker Botts L.L.P.
         G-1          Borrower Pledge and Security Agreement
         G-2          Subsidiary Pledge and Security Agreement
         G-3          MLP Pledge and Security Agreement
         H            Master Consent to Assignment
         I            Borrowing Base Certificate
         J            Swing Line Loan Notice
         K            Fleet Mortgage
         L            Leasehold Mortgage (Tampa Facility)
         M            Deed of Trust (Stanolind Terminal)




                                       iv
<PAGE>



                                CREDIT AGREEMENT


         This CREDIT AGREEMENT ("Agreement") is entered into as of November 6,
2002, among MARTIN OPERATING PARTNERSHIP L.P., a Delaware limited partnership
(the "Borrower"), MARTIN MIDSTREAM PARTNERS L.P., a Delaware limited partnership
(the "MLP"), each lender from time to time party hereto (collectively, the
"Lenders" and individually, a "Lender"), ROYAL BANK OF CANADA, a Canadian
chartered bank under and governed by the provisions of the Bank Act, being S.C.
1991, c.46, as Administrative Agent and Collateral Agent, and COMERICA
BANK-TEXAS, a Texas State Bank, as Co-Agent.

         The Borrower has requested that the Lenders provide a secured term loan
facility and a secured revolving credit facility, and the Lenders are willing to
do so on the terms and conditions set forth herein.

         In consideration of the mutual covenants and agreements herein
contained, the parties hereto covenant and agree as follows:

                                   ARTICLE I.
                        DEFINITIONS AND ACCOUNTING TERMS

         SECTION 1.01 DEFINED TERMS. As used in this Agreement, the following
terms shall have the meanings set forth below:

         Accounts Receivable means and includes all of the Borrower's and the
Subsidiaries' now owned or hereafter acquired or arising accounts, as defined in
the U.C.C., including any rights to payment for the sale or lease of goods or
rendition of services, whether or not they have been earned by performance.

         Acquisition means any acquisition by a Company of assets (other than
equity interests and assets acquired in the ordinary course of business in
connection with or incidental to its then existing businesses and operations).
For the avoidance of doubt, the acquisition of Vessels shall not be considered a
transaction in the ordinary course of business.

         Acquisition Subfacility has the meaning specified in Section 2.01(b).

         Acquisition Subfacility Commitment means an amount (subject to
reduction or cancellation as herein provided) equal to $10,000,000.

         Additional Amount has the meaning specified in Section 7.17(a).

         Administrative Agent means Royal Bank in its capacity as administrative
agent under any of the Loan Documents, or any successor administrative agent.

         Administrative Agent's Office means the Administrative Agent's address
and, as appropriate, account as set forth on Schedule 10.02, or such other
address or account as the Administrative Agent may from time to time notify to
the Borrower and the Lenders.

         Administrative Questionnaire means an Administrative Questionnaire in a
form supplied by the Administrative Agent.

         Affiliate means, as to any Person, any other Person directly or
indirectly controlling, controlled by, or under direct or indirect common
control with, such Person. A Person shall be deemed to be controlled by any
other Person if such other Person possesses, directly or indirectly, power (a)
to vote



<PAGE>



10% or more of the securities (on a fully diluted basis) having ordinary voting
power for the election of directors, managing members, or managing general
partners; or (b) to direct or cause the direction of the management and policies
of such Person whether by contract or otherwise.

         Agent/Arranger Fee Letter has the meaning specified in Section 2.08(b).

         Agent-Related Persons means the Administrative Agent and the Collateral
Agent (including any successor administrative agent and collateral agent),
together with their respective Affiliates, and the officers, directors,
employees, agents and attorneys-in-fact of such Persons and Affiliates.

         Aggregate Commitments has the meaning set forth in the definition of
"Commitment."

         Aggregate Committed Sum means, on any date of determination, the sum of
all Committed Sums then in effect for all Lenders in respect of the Revolver
Facility and the Term Loan Facility (as the same may have been reduced or
canceled as provided in the Loan Documents).

         Agreement means this Credit Agreement.

         Applicable Rate means the following percentages per annum set forth in
the table below, on any date of determination, with respect to the Type of
Credit Extension or commitment fee that corresponds to the Leverage Ratio at
such date of determination, as calculated based on the quarterly Compliance
Certificate most recently delivered pursuant to Section 6.02(a):

<Table>
<Caption>
                                          APPLICABLE RATE
---------------------------------------------------------------------------------------------
                                                               Letter of
                                                               Credit and
   Pricing                                   Commitment        Eurodollar       Base Rate +
    Level            Leverage Ratio           fee (bps)        Rate + (bps)        (bps)
-------------- ---------------------------- ---------------- ---------------- ---------------
<S>            <C>                          <C>              <C>              <C>
      1           Less than or equal to          37.5             175.0            75.0
                        1.00:1.00

      2        Greater than 1.00:1.00 but        37.5             200.0           100.0
                  less than or equal to
                        2.00:1.00

      3        Greater than 2.00:1.00 but        50.0             225.0           125.0
                  less than or equal to
                        2.50:1.00

      4        Greater than 2.50:1.00 but        50.0             250.0           150.0
                  less than or equal to
                        2.75:1.00

      5          Greater than 2.75:1.00          50.0             275.0           175.0
</Table>

         Any increase or decrease in the Applicable Rate resulting from a change
in the Leverage Ratio shall become effective as of the first day of the fiscal
quarter of the Borrower immediately following the date of a Compliance
Certificate delivered pursuant to Section 6.02; provided, however, that if no
Compliance Certificate is delivered during a fiscal quarter when due in
accordance with such Section the following Pricing Levels and Applicable Rates
shall apply: (a) Pricing Level 4 shall apply as of the first day of such
following fiscal quarter if Pricing Level 1, 2, or 3 is in effect for the
current fiscal quarter; (b) Pricing Level 5 shall apply as of the first day of
such following fiscal quarter if Pricing Level 4 is in effect for the current
fiscal quarter; and (c) Base Rate plus 2.00% shall apply as of the first day of
such following fiscal quarter if Pricing Level 5 is in effect for the current
fiscal quarter. The Applicable Rate



                                       2
<PAGE>



in effect from the Closing Date through the date the Compliance Certificate is
delivered in connection with the fiscal quarter ended March 31, 2003, shall be
the greater of (i) Pricing Level 3 or (ii) the Pricing Level that corresponds to
the Leverage Ratio set forth in the most recently delivered Compliance
Certificate.

         Appraisal shall have the meaning set forth in Section 6.02(d).

         Approved Fund means any Fund that is administered or managed by a
Lender, an Affiliate of a Lender, or an entity or an Affiliate of an entity that
administers or manages a Lender.

         Arranger means Royal Bank, in its capacity as lead arranger and book
runner.

         Assignment and Assumption means an assignment and assumption entered
into by a Lender and an Eligible Assignee (with the consent of any party whose
consent is required by Section 10.07), and accepted by the Administrative Agent
substantially in the form of Exhibit D or any other form approved by the
Administrative Agent.

         Assumed Indebtedness means the Indebtedness described on Schedule
1.01(a).

         Attorney Costs means and includes the fees and disbursements of any law
firm or other external counsel.

         Attributable Indebtedness means, on any date, (a) in respect of any
Capital Lease of any Person, the capitalized amount thereof that would appear on
a balance sheet of such Person prepared as of such date in accordance with GAAP
and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of
the remaining lease payments under the relevant lease that would appear on a
balance sheet of such Person prepared as of such date in accordance with GAAP if
such lease were accounted for as a capital lease.

         Authorizations means all filings, recordings, and registrations with,
and all validations or exemptions, approvals, orders, authorizations, consents,
franchises, licenses, certificates, and permits from, any Governmental
Authority.

         Availability Period shall have the meaning set forth in Section
2.01(a).

         Bank Guaranties means guaranties or other agreements or instruments
serving a similar function issued by a bank or other financial institution.

         Base Rate means for any day a fluctuating rate per annum equal to the
higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest
in effect for such day as publicly announced from time to time in its sole
discretion by Royal Bank as its prime commercial lending rate for United States
Dollar loans in the United States. Royal Bank's prime commercial lending rate is
not necessarily the lowest rate Royal Bank is charging any corporate customer.
Any change in such rate announced by Royal Bank shall take effect at the opening
of business on the day specified in the public announcement of such change.

         Base Rate Loan means a Loan that bears interest based on the Base Rate.

         Board means the Board of Governors of the Federal Reserve System of the
United States of America.

         Borrower has the meaning set forth in the introductory paragraph
hereto.



                                       3
<PAGE>



         Borrower Affiliate means the Borrower, the Borrower General Partner,
the MLP, the MLP General Partner, and each of their respective Subsidiaries.

         Borrower General Partner means the general partner of the Borrower. As
of the Closing Date, the general partner of the Borrower is Martin Operating GP
LLC, a Delaware limited liability company.

         Borrower Operating Agreements means the Organization Documents of each
of the MLP General Partner, the MLP, the Borrower General Partner, the Borrower
and each of their respective Subsidiaries.

         Borrowing means a Committed Borrowing or a Swing Line Borrowing, as the
context may require.

         Borrowing Base (Working Capital/Distribution Subfacility) means an
amount equal to (a) the sum of (i) seventy-five percent (75%) of the Eligible
Accounts Receivable and (ii) sixty percent (60%) of the Eligible Inventory
(amounts available under this clause (ii) of the Borrowing Base (Working
Capital/Distribution Subfacility) which are attributable to Fertilizer shall not
exceed $4,000,000) less (b) the sum of (i) the aggregate amount of all First
Purchase Payables and (ii) the Borrowing Base Reserve. The Borrowing Base
(Working Capital/Distribution Subfacility) shall be determined each month by
reference to the most recent Borrowing Base Certificate delivered to the
Administrative Agent (absent any error in such Borrowing Base Certificate) which
shall be effective as of the date such certificate is required to be delivered
pursuant to Section 6.02(e).

         Borrowing Base Certificate means a certificate in the form of Exhibit H
or any other form approved by the Administrative Agent, together with all
attachments contemplated thereby.

         Borrowing Base Reserve means the following amounts:

<Table>
<Caption>
                 BORROWING BASE RESERVE                     BORROWING BASE RESERVE PERIOD
         --------------------------------------- ---------------------------------------------------
<S>                                              <C>
                  $0                             Closing Date through January 5, 2003

                  $375,000                       January 6, 2003 through April 5, 2003

                  $750,000                       April 6, 2003 through July 5, 2003

                  $1,125,000                     July 6, 2003 through October 5, 2003

                  $1,500,000                     October 6, 2003 through January 5, 2004

                  $1,875,000                     January 6, 2004 through April 5, 2004

                  $2,250,000                     April 6, 2004 through July 5, 2004

                  $2,625,000                     July 6, 2004 through October 5, 2004

                  $3,000,000                     October 6, 2004 through January 5, 2005

                  $3,375,000                     January 6, 2005 through April 5, 2005

                  $3,750,000                     April 6, 2005 through July 5, 2005

                  $4,125,000                     July 6, 2005 through Stated Maturity Date
</Table>

         Business Day means any day other than a Saturday, Sunday, or other day
on which commercial banks are authorized to close under the Laws of, or are in
fact closed in, the state where the



                                       4
<PAGE>



Administrative Agent's Office is located and, if such day relates to any
Eurodollar Rate Loan, means any such day on which dealings in Dollar deposits
are conducted by and between banks in the applicable offshore Dollar interbank
market.

         Capital Expenditure by a Person means an expenditure (determined in
accordance with GAAP) for any fixed asset owned by such Person for use in the
operations of such Person having a useful life of more than one year, or any
improvements or additions thereto.

         Capital Lease means any capital lease or sublease which should be
capitalized on a balance sheet in accordance with GAAP.

         Cash Collateralize means to pledge and deposit with or deliver to the
Collateral Agent, for the benefit of the L/C Issuer and the Lenders, as
collateral for the L/C Obligations, cash and deposit account balances pursuant
to documentation in form and substance satisfactory to the Administrative Agent,
the Collateral Agent, and the L/C Issuer (which documents hereby are consented
to by the Lenders).

         Cash Equivalents means:

         (a) United States Dollars;

         (b) direct general obligations, or obligations of, or obligations fully
and unconditionally guaranteed as to the timely payment of principal and
interest by, the United States or any agency or instrumentality thereof having
remaining maturities of not more than thirteen (13) months, but excluding any
such securities whose terms do not provide for payment of a fixed dollar amount
upon maturity or call for redemptions;

         (c) certificates of deposit and eurodollar time deposits with
maturities of thirteen (13) months or less, bankers acceptances with maturities
not exceeding one hundred eighty (180) days, overnight bank deposits and other
similar short term instruments, in each case with any domestic commercial bank
(i) having capital and surplus in excess of $250,000,000 and (ii) (A) having a
rating of at least "A2" by Moody's and at least "A" by S&P or (B) that is a
Lender not rated by Moody's and/or S&P;

         (d) repurchase obligations with a term of not more than thirteen (13)
months for underlying securities of the types described in (b) and (c) above
entered into with any financial institution meeting the qualifications in (c)
above;

         (e) commercial paper (having original maturities of not more than two
hundred seventy (270) days) of any Person rated "P-1" or better by Moody's or
"A-1" or the equivalent by S&P; and

         (f) money market mutual or similar funds having assets in excess of
$100,000,000, at least 95% of the assets of which are comprised of assets
specified in clause (a) through (e) above.

         CF Industries means CF Industries, Inc., a Delaware corporation.

         CF Martin Sulphur means CF Martin Sulphur L.P., a Delaware limited
partnership.

         CF Martin Sulphur General Partner means CF Martin Sulphur LLC, a
Delaware limited liability company.

         Change of Control means (a) Martin Resource shall fail to own, directly
or indirectly, at least 51% of the general partnership interests and at least
33?% of the limited partnership interests in the MLP,



                                       5
<PAGE>



(b) any Person, entity or group (other than Martin Resource) acquires beneficial
ownership (within the meaning of Rule 13d-3 of the Securities and Exchange
Commission under the Exchange Act) of 66 2/3% or more of the limited partnership
interests in the MLP, (c) the MLP shall fail to own, directly or indirectly,
100% of the equity interests in the Borrower, (d) Martin Resource fails for any
reason to control, directly or indirectly, the management of the MLP or fails to
control, directly or indirectly, the management of the Borrower, or (e) a Martin
Resource Change of Control shall occur.

         Change in Law means (a) the adoption of any law, rule or regulation
after the date of this Agreement, (b) any change in any law, rule or regulation
or in the interpretation or application thereof by any Governmental Authority
after the date of this Agreement or (c) compliance by any Lender or the L/C
Issuer (or, for purposes of Section 3.04(b), by any lending office of such
Lender or by such Lender's or the L/C Issuer's holding company, if any) with any
request, guideline or directive (whether or not having the force of law) of any
Governmental Authority made or issued after the date of this Agreement.

         Closing Date means the date upon which this Agreement and the other
Loan Documents have been executed by the Borrower, the MLP, the Lenders, the
Administrative Agent, and the Collateral Agent.

         Co-Agent Related Person means Comerica Bank-Texas, a Texas State Bank,
together with its Affiliates, and their respective officers, directors,
employees, agents and attorneys-in-fact.

         Code means the Internal Revenue Code of 1986.

         Collateral means all property and interests in property and proceeds
thereof now owned or hereafter acquired by the MLP, the Borrower, and their
respective Subsidiaries in or upon which a Lien now or hereafter exists in favor
of the Lenders, or the Collateral Agent on behalf of the Lenders, including all
of the assets (including stock and other equity interests, provided, neither
equity interests in CF Martin Sulphur nor the general partnership interests of
the Borrower shall be pledged unless the conditions in Section 6.18 are
satisfied) of the MLP, the Borrower General Partner, the Borrower, and their
respective Subsidiaries, whether under this Agreement, the Collateral Documents,
or under any other document executed by any Borrower Affiliate and delivered to
the Administrative Agent or the Lenders.

         Collateral Agent means Royal Bank, in its capacity as collateral agent
under any of the Loan Documents, or any successor collateral agent.

         Collateral Agent's Office means the Collateral Agent's address and, as
appropriate, account as set forth on Schedule 10.02, or such other address or
account as the Collateral Agent may from time to time notify to the Borrower and
the Lenders.

         Collateral Documents means (a) each guaranty, pledge agreement,
security agreement, ship mortgage, fleet mortgage, mortgage, assignment, and all
other security agreements, deeds of trust, mortgages, chattel mortgages,
assignments, pledges, guaranties, financing statements, continuation statements,
extension agreements and other similar agreements or instruments executed by the
Borrower, the MLP, the Borrower General Partner, any Guarantor, or any of their
respective Subsidiaries for the benefit of the Lenders now or hereafter
delivered to the Lenders or the Administrative Agent pursuant to or in
connection with the transactions contemplated hereby, and all financing
statements (or comparable documents now or hereafter filed in accordance with
the Uniform Commercial Code or comparable law) against the Borrower, the MLP,
the MLP General Partner, any Guarantor, or any of their respective Subsidiaries
as debtor in favor of the Lenders or the Collateral Agent for the benefit of the
Lenders as secured party to secure or guarantee the payment of any part of the
Obligations or the performance of any other duties and obligations of Borrower
under the Loan Documents, whenever made or delivered, and



                                       6
<PAGE>



(b) any amendments, supplements, modifications, renewals, replacements,
consolidations, substitutions, restatements, and extensions of any of the
foregoing.

         Commitment means, as to each Lender, its obligation to make (i)
Committed Loans to the Borrower pursuant to Section 2.01, in an amount at any
one time outstanding not to exceed its Committed Sum, (ii) make Committed Loans
to the Borrower on the Conditions Effective Date pursuant to Section 2.02, in an
amount not to exceed its Committed Sum, (iii) to purchase participations in L/C
Obligations pursuant to Section 2.14, in an aggregate principal amount at any
one time outstanding not to exceed, when aggregated with the Loans made pursuant
to Section 2.01, its Committed Sum, and (iv) to purchase participations in Swing
Line Loans pursuant to Section 2.15, in an amount at any one time outstanding
not to exceed its Committed Sum, in each case as such amount may be reduced or
adjusted from time to time in accordance with this Agreement (collectively, the
"Aggregate Commitments").

         Committed Borrowing means a borrowing consisting of simultaneous
Committed Loans of the same Type and having the same Interest Period made by
each of the Lenders pursuant to Section 2.01 or 2.02.

         Committed Loan has the meaning specified in Section 2.01 and 2.02.

         Committed Loan Notice means a notice of (a) a Committed Borrowing, (b)
a conversion of Committed Loans from one Type to the other, or (c) a
continuation of Committed Loans as the same Type, pursuant to Section 2.03(a),
which, if in writing, shall be substantially in the form of Exhibit A-1 or A-2,
as applicable.

         Committed Sum means for any Lender (a) with respect to the Acquisition
Subfacility, at any date of determination occurring prior to the Maturity Date,
the amount stated beside such Lender's name under the heading for the
Acquisition Subfacility on the most-recently amended Schedule 2.01 to this
Agreement (which amount is subject to increase, reduction, or cancellation in
accordance with the Loan Documents), (b) with respect to the Working
Capital/Distribution Subfacility, at any date of determination occurring prior
to the Maturity Date, the amount stated beside such Lender's name under the
heading for the Working Capital/Distribution Subfacility on the most recently
amended Schedule 2.01 to this Agreement (which amount is subject to increase,
reduction, or cancellation in accordance with the Loan Documents), and (c) with
respect to the Term Loan Facility, at any date of determination occurring prior
to the Maturity Date, the amount stated beside such Lender's name under the
heading for the Term Loan Facility on the most-recently amended Schedule 2.01 to
this Agreement (which amount is subject to increase, reduction, or cancellation
in accordance with the Loan Documents).

         Company and Companies means, on any date of determination thereof, the
MLP, the Borrower and each of their respective Subsidiaries.

         Compensation Period has the meaning set forth in Section 2.11(e)(ii).

         Compliance Certificate means a certificate substantially in the form of
Exhibit C.

         Conditions Effective Date means the first date all the conditions
precedent in Section 4.01 are satisfied or waived in accordance with Section
4.01 (or, in the case of Sections 4.01(b) and (c), waived by the Person entitled
to receive the applicable payment).

         Consolidated EBITDA means, for any period, for the MLP and its
Subsidiaries on a consolidated basis, an amount equal to (a) the sum of (i)
Consolidated Net Income, (ii) Consolidated Interest Charges, (iii) the amount of
taxes, based on or measured by income, used or included in the determination of
such



                                       7
<PAGE>



Consolidated Net Income, (iv) the amount of depreciation, depletion, and
amortization expense deducted in determining such Consolidated Net Income, (v)
other non-cash charges and expenses, including, without limitation, non-cash
charges and expenses relating to Swap Contracts or resulting from accounting
convention changes, of the MLP and its Subsidiaries on a consolidated basis, and
(vi) cash distributions actually received by the MLP and its Subsidiaries from
CF Martin Sulphur less (b) the amount of the MLP's and its Subsidiaries' equity
in the earnings of CF Martin Sulphur, all determined in accordance with GAAP.

         For purposes of calculating compliance with Section 7.15, (A)
Consolidated EBITDA for any fiscal quarter ending on or prior to September 30,
2002, shall be the pro forma results of the MLP set forth in financial
statements provided by the Borrower to the Administrative Agent and to each
Lender, which financial information shall be prepared using a methodology
substantially similar to the methodology used in preparing the pro forma results
of the MLP as set forth in the MLP Registration Statement, and (B) Consolidated
EBITDA for any fiscal quarter ending on or after December 31, 2002, shall be the
actual results of the MLP as set forth in financial statements filed with the
Securities and Exchange Commission in the Form 10-K or 10-Q (financial results
for the period ended December 31, 2002, shall be adjusted on a pro forma basis
as necessary for the period prior to the MLP Offering Closing), in each case
with respect to which financial statements the Borrower shall have provided a
certificate containing the representations and warranties set forth in Section
5.05(a).

         Consolidated Funded Debt means, as of any date of determination, for
the MLP and its Subsidiaries on a consolidated basis, the sum of (a) the
outstanding principal amount of all obligations and liabilities, whether current
or long-term, for borrowed money (including Letters of Credit and all other
Obligations hereunder), (b) Attributable Indebtedness with respect to Capital
Leases, (c) Attributable Indebtedness with respect to Synthetic Lease
Obligations, and (d) without duplication, all Guaranty Obligations with respect
to Indebtedness of the type specified in subsections (a) through (c) above.

         Consolidated Interest Charges means, for any period, for the MLP and
its Subsidiaries on a consolidated basis, the sum of all interest, premium
payments, fees, charges and related expenses of the MLP and its Subsidiaries in
connection with Indebtedness (including capitalized interest), in each case to
the extent treated as interest in accordance with GAAP.

         Consolidated Net Income means, for any period, for the MLP and its
Subsidiaries on a consolidated basis, the net income or net loss of the MLP and
its Subsidiaries from continuing operations, provided that there shall be
excluded from such net income (to the extent otherwise included therein): (a)
the income (or loss) of any entity other than a Subsidiary in which the MLP or
any Subsidiary has an ownership interest, except to the extent that any such
income has been actually received by the MLP or such Subsidiary in the form of
cash dividends or similar cash distributions; (b) net extraordinary gains and
losses (other than, in the case of losses, losses resulting from charges against
net income to establish or increase reserves for potential environmental
liabilities and reserves for exposure under rate cases), (c) any gains or losses
attributable to non-cash write-ups or write-downs of assets, (d) proceeds of any
insurance on property, plant or equipment other than business interruption
insurance, (e) any gain or loss, net of taxes, on the sale, retirement or other
disposition of assets (including the capital stock or other equity ownership of
any other person, but excluding the sale of inventories in the ordinary course
of business), and (f) the cumulative effect of a change in accounting
principles.

         Contractual Obligation means, as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.



                                       8
<PAGE>



         Contribution Agreement means the Contribution, Conveyance and
Assumption Agreement dated as of October 31, 2002, by and among the MLP, the
Borrower, Martin Resource, Martin Resource LLC, a Delaware limited liability
company, the MLP General Partner, the Borrower General Partner, Martin Gas
Marine, Martin L.P. Gas, Inc., a Texas corporation, Martin Gas Sales, Martin
Transport, Inc., a Texas corporation, CF Martin Sulphur Holding Corporation, a
Nevada corporation, and Midstream Fuel Service LLC, an Alabama limited liability
company.

         Credit Extension means each of the following: (a) a Committed
Borrowing, (b) a Swing Line Borrowing, and (c) an L/C Credit Extension.

         Current Ratio means, as of any date of determination, the ratio of (a)
consolidated current assets of the MLP and its Subsidiaries (including any
unused portion of the Working Capital/Distribution Subfacility Commitment) to
(b) consolidated current liabilities of the MLP and its Subsidiaries, both as
determined in accordance with GAAP; provided, that for purposes of this
definition, non-cash marked-to-market adjustments relating to Swap Agreements
required to be made under GAAP shall be excluded for purposes of determining
such ratio.

         Debtor Relief Laws means the Bankruptcy Code of the United States of
America, and all other liquidation, conservatorship, bankruptcy, assignment for
the benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States of America or
other applicable jurisdictions from time to time in effect and affecting the
rights of creditors generally.

         Default means any event that, with the giving of any notice, the
passage of time, or both, would be an Event of Default.

         Default Rate means an interest rate equal to (a) the Base Rate plus (b)
the Applicable Rate, if any, applicable to Base Rate Loans plus (c) 2% per
annum; provided, however, that with respect to a Eurodollar Rate Loan, the
Default Rate shall be an interest rate equal to the interest rate (including any
Applicable Rate) otherwise applicable to such Loan plus 2% per annum, in each
case to the fullest extent permitted by applicable Laws.

         Designated Martin Shareholders means the shareholders of Martin
Resource reflected in Schedule 1.01(b) hereto, together with their respective
Affiliates, Family and Family Trusts.

         Disposition or Dispose means the sale, transfer, license, or other
disposition (including any sale and leaseback transaction) of any property
(including stock, partnership and other equity interests) by any Person of
property owned by such Person, including any sale, assignment, transfer, or
other disposal (including any damage to, loss or destruction of any property, or
other event resulting in payments being made to a Person under an insurance
policy or as a result of any condemnation or Vessel requisition), with or
without recourse, of any notes or accounts receivable or any rights and claims
associated therewith. For the avoidance of doubt, the term Disposition shall not
include the issuance by a Person of its own equity interests.

         Distribution Loan means a Committed Loan which is made in whole or in
part for the purpose of paying a Quarterly Distribution or for the purpose of
reimbursing the General Partner for the purchase price of partnership units
purchased under the MLP's long-term incentive plan.

         Dollar or $ means lawful money of the United States of America.



                                       9
<PAGE>



         Domestic Person means any corporation, general partnership, limited
partnership, or limited liability company that is organized under the laws of
the United States of America or any state thereof or the District of Columbia.

         Eligible Accounts Receivable means Accounts Receivable, excluding any
Account Receivable:

         (a) with respect to which more than ninety (90) days have elapsed since
the date of the original invoice;

         (b) with respect to which any of the representations, warranties,
covenants, and agreements contained in any Collateral Document are incorrect or
have been breached in any material respect;

         (c) with respect to which, in whole or in part, a check, promissory
note, draft, trade acceptance or other instrument for the payment of money has
been received, presented for payment and returned uncollected for any reason for
such Account Receivable (or any other Account Receivable due from such account
debtor);

         (d) which represents a progress billing (as hereinafter defined) or as
to which the Borrower or any of the Subsidiaries has extended the time for
payment without the consent of the Administrative Agent; for the purposes
hereof, "progress billing" means any invoice for goods sold or leased or
services rendered under a contract or agreement pursuant to which the account
debtor's obligation to pay such invoice is conditioned upon the Borrower's or
any of the Subsidiaries' completion of any further performance under the
contract or agreement;

         (e) with respect to which any one or more of the following events has
occurred to the account debtor on such Account Receivable: death or judicial
declaration of incompetency of an account debtor who is an individual; the
filing by or against the account debtor of a request or petition for
liquidation, reorganization, arrangement, adjustment of debts, adjudication as a
bankrupt, winding-up, or other relief under the bankruptcy, insolvency, or
similar laws of the United States, any state or territory thereof, or any
foreign jurisdiction, now or hereafter in effect; the making of any general
assignment by the account debtor for the benefit of creditors; the appointment
of a receiver or trustee for the account debtor or for any of the assets of the
account debtor, including, without limitation, the appointment of or taking
possession by a "custodian," as defined in the U.S. Federal Bankruptcy Code; the
institution by or against the account debtor of any other type of insolvency
proceeding (under the bankruptcy laws of the United States or otherwise) or of
any formal or informal proceeding for the dissolution or liquidation of,
settlement of claims against, or winding up of affairs of, the account debtor;
the sale, assignment, or transfer of all or any material part of the assets of
the account debtor; the nonpayment generally by the account debtor of its debts
as they become due; or the cessation of the business of the account debtor as a
going concern;

         (f) if twenty-five percent (25%) or more of the aggregate Dollar amount
of outstanding Accounts Receivable owed at such time by the account debtor
thereon is classified as ineligible under clause (a) above, provided, however,
any Account Receivable classified as ineligible under clause (a) above shall not
be included in the calculation of the twenty-five percent (25%) threshold in
this clause (f) if such Account Receivable is the subject of a bona fide dispute
between such account debtor and the Borrower;

         (g) owed by an account debtor which: (1) does not maintain its chief
executive office in the United States; or (2) is not organized under the laws of
the United States or any state thereof; or (3) is the government of any foreign
country or sovereign state, or of any state, province, municipality, or other
political subdivision thereof, or of any department, agency, public corporation,
or other instrumentality



                                       10
<PAGE>



thereof; except to the extent that such Account Receivable is secured or payable
by a letter of credit satisfactory to the Administrative Agent in its
discretion;

         (h) owed by an account debtor which is an Affiliate or employee of the
Borrower or any of its Subsidiaries;

         (i) except as provided in clause (k) below, with respect to which
either the perfection, enforceability, or validity of the Collateral Agent's
Liens in such Account Receivable, or the Collateral Agent's right or ability to
obtain direct payment to the Collateral Agent of the proceeds of such Account
Receivable, is governed by any federal, state, or local statutory requirements
other than those of the U.C.C.;

         (j) owed by an account debtor to which the Borrower or any of its
Subsidiaries, is indebted in any way, or which is subject to any right of setoff
or recoupment by the account debtor, or if the account debtor thereon has
disputed liability or made any claim with respect to any other Account
Receivable due from such account debtor; but in each such case only to the
extent of such indebtedness, setoff, recoupment, dispute, or claim;

         (k) owed by the government of the United States, or any department,
agency, public corporation, or other instrumentality thereof, unless the Federal
Assignment of Claims Act of 1940, as amended (31 U.S.C. Section 3727 et seq.),
and any other steps necessary to perfect the Collateral Agent's Liens therein,
have been complied with to the Administrative Agent's and Collateral Agent's
satisfaction with respect to such Account Receivable;

         (l) owed by any state, municipality, or other political subdivision of
the United States, or any department, agency, public corporation, or other
instrumentality thereof and as to which the Administrative Agent determines that
its Lien therein is not or cannot be perfected;

         (m) which represents a sale on a bill-and-hold, guaranteed sale, sale
and return, sale on approval, consignment, or other repurchase or return basis;

         (n) which is evidenced by a promissory note or other instrument or by
chattel paper;

         (o) if the Administrative Agent believes, in the exercise of its
reasonable judgment, that the prospect of collection of such Account Receivable
is reasonably likely to be impaired or that the Account Receivable could
reasonably be expected not to be paid by reason of the account debtor's
financial inability to pay;

         (p) with respect to which the account debtor is located in any state
requiring the filing of a Notice of Business Activities Report or similar report
in order to permit the Borrower or any of the Subsidiaries to seek judicial
enforcement in such state of payment of such Account Receivable, unless such
Borrower or Subsidiary has qualified to do business in such state or has filed a
Notice of Business Activities Report or equivalent report for the then current
year;

         (q) which arises out of a sale not made in the ordinary course of the
Borrower's or any of the Subsidiaries' business;

         (r) with respect to which the goods giving rise to such Account
Receivable have not been shipped and delivered to and accepted by the account
debtor or the services giving rise to such Account Receivable have not been
performed by the Borrower or a Subsidiary, as applicable, and, if applicable,
accepted by the account debtor, or the account debtor revokes its acceptance of
such goods or services;



                                       11
<PAGE>



         (s) owed by an account debtor which is obligated to the Borrower or any
of the Subsidiaries respecting Accounts Receivable the aggregate unpaid balance
of which exceeds twenty-five percent (25%) of the aggregate unpaid balance of
all Accounts Receivable owed to the Borrower or any of the Subsidiaries at such
time by all of the Borrower's and the Subsidiaries' account debtors, but only to
the extent of such excess;

         (t) which is not subject to a first priority and perfected security
interest in favor of the Collateral Agent for the benefit of the Lenders except
that the Collateral Agent's Liens may be subject to a statutory Lien in respect
of First Purchase Payables;

         (u) which the Administrative Agent or the Required Lenders in their
reasonable discretion determine to be ineligible.

         If any Account Receivable at any time ceases to be an Eligible Account
Receivable, then such Account Receivable shall promptly be excluded from the
calculation of Eligible Accounts Receivable.

         Eligible Assignee means (a) a Lender; (b) an Affiliate of a Lender; (c)
an Approved Fund and (d) any other Person (other than a natural Person) approved
by (i) the Administrative Agent, (ii) the Swing Line Lender, (iii) in case of
any assignment of a Revolver Commitment, the L/C Issuer, and (iv) unless a
Default or Event of Default shall have occurred and is continuing, the Borrower
(each such approval not to be unreasonably withheld or delayed); provided that
notwithstanding the foregoing, "Eligible Assignee" shall not include the
Borrower, the MLP, any Martin Party, or any of their respective Affiliates or
Subsidiaries.

         Eligible Inventory means all Inventory excluding any Inventory:

         (a) that is not owned by the Borrower or any of the Subsidiaries;

         (b) that is not subject to the Collateral Agent's Liens, which are
perfected as to such Inventory, or that are subject to any other Lien whatsoever
(other than those in respect of First Purchase Payables or the Liens described
in clause (d), (l) and (m) (to the extent clause (f) below has been complied
with) of Section 7.01 ("Permitted Inventory Liens") provided that such Permitted
Inventory Liens described in clause (d), (l) and (m) of Section 7.01 (1) are
junior in priority to the Collateral Agent's Liens and (2) do not materially
impair the ability of the Collateral Agent to realize on or obtain the full
benefit of such Inventory);

         (c) that does not consist of finished goods or raw materials;

         (d) that is not in good condition, is obsolete, is damaged, is
unmerchantable, or does not meet all standards imposed by any governmental
authority, having regulatory authority over such goods, their use or sale;

         (e) that is located outside the United States of America (or that is in
transit from vendors or suppliers);

         (f) that is in possession of a bailee or in a facility leased by the
Borrower or any of the Subsidiaries, unless (i) the bailee or the lessor has
delivered to the Administrative Agent, if requested by the Administrative Agent,
a subordination agreement in form and substance satisfactory to the
Administrative Agent, or (ii) an amount sufficient in the opinion of the
Administrative Agent has been deducted from the value of such Inventory to cover
rents, storage, handling and related charges;



                                       12
<PAGE>



         (g) that is Inventory placed on consignment;

         (h) which the Administrative Agent or the Required Lenders in their
reasonable discretion determine to be ineligible.

         If any Inventory at any time ceases to be Eligible Inventory, such
Inventory shall promptly be excluded from the calculation of Eligible Inventory.

         Environmental Law means any applicable Law that relates to (a) the
condition or protection of air, groundwater, surface water, soil, or other
environmental media, (b) the environment, including natural resources or any
activity which affects the environment, (c) the regulation of any pollutants,
contaminants, wastes, substances, and Hazardous Substances, including, without
limitation, the Comprehensive Environmental Response, Compensation, and
Liability Act (42 U.S.C. Section 9601 et seq.) ("CERCLA"), the Clean Air Act (42
U.S.C. Section 7401 et seq.), the Federal Water Pollution Control Act, as
amended by the Clean Water Act (33 U.S.C. Section 1251 et seq.), the Federal
Insecticide, Fungicide, and Rodenticide Act (7 U.S.C. Section 136 et seq.), the
Emergency Planning and Community Right to Know Act of 1986 (42 U.S.C. Section
11001 et seq.), the Hazardous Materials Transportation Act (49 U.S.C. Section
1801 et seq.), the National Environmental Policy Act of 1969 (42 U.S.C. Section
4321 et seq.), the Oil Pollution Act (33 U.S.C. Section 2701 et seq.), the
Resource Conservation and Recovery Act (42 U.S.C. Section 6901 et seq.), the
Rivers and Harbors Act (33 U.S.C. Section 401 et seq.), the Safe Drinking Water
Act (42 U.S.C. Section 201 and Section 300f et seq.), the Solid Waste Disposal
Act, as amended by the Resource Conservation and Recovery Act of 1976 and the
Hazardous and Solid Waste Amendments of 1984 (42 U.S.C. Section 6901 et seq.),
the Toxic Substances Control Act (15 U.S.C. Section 2601 et seq.), and analogous
state and local Laws, as any of the foregoing may have been and may be amended
or supplemented from time to time, and any analogous enacted or adopted Law, or
(d) the Release or threatened Release of Hazardous Substances.

         ERISA means the Employee Retirement Income Security Act of 1974 and any
regulations issued pursuant thereto.

         ERISA Affiliate means any trade or business (whether or not
incorporated) under common control with the Borrower within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for
purposes of provisions of this Agreement relating to obligations imposed under
Section 412 of the Code).

         ERISA Event means (a) a Reportable Event with respect to a Pension
Plan; (b) a withdrawal by the Borrower or any ERISA Affiliate from a Pension
Plan subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation
of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA
Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is
in reorganization; (d) the filing of a notice of intent to terminate, the
treatment of a Plan amendment as a termination under Sections 4041 or 4041A of
ERISA, or the commencement of proceedings by the PBGC to terminate a Pension
Plan or Multiemployer Plan; (e) an event or condition which might reasonably be
expected to constitute grounds under Section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Pension Plan or
Multiemployer Plan; or (f) the imposition of any liability under Title IV of
ERISA, other than PBGC premiums due but not delinquent under Section 4007 of
ERISA, upon the Borrower or any ERISA Affiliate.



                                       13
<PAGE>



         Eurodollar Rate means for any Interest Period with respect to any
Eurodollar Rate Loan:

         (a) the rate per annum equal to the rate determined by the
Administrative Agent to be the offered rate that appears on the page (such page
currently being page 3750) of the Telerate screen (or any successor thereto)
that displays an average British Bankers Association Interest Settlement Rate
for deposits in Dollars (for delivery on the first day of such Interest Period)
with a term equivalent to such Interest Period, determined as of approximately
11:00 a.m. (London time) two Business Days prior to the first day of such
Interest Period, or

         (b) if the rate referenced in the preceding subsection (a) does not
appear on such page or service or such page or service shall cease to be
available, the rate per annum equal to the rate determined by the Administrative
Agent to be the offered rate on such other page or other service that displays
an average British Bankers Association Interest Settlement Rate for deposits in
Dollars (for delivery on the first day of such Interest Period) with a term
equivalent to such Interest Period, determined as of approximately 11:00 a.m.
(London time) two Business Days prior to the first day of such Interest Period,
or

         (c) if the rates referenced in the preceding subsections (a) and (b)
are not available, the rate per annum determined by the Administrative Agent as
the rate of interest (rounded upward to the next 1/100th of 1%) at which
deposits in Dollars for delivery on the first day of such Interest Period in
same day funds in the approximate amount of the Eurodollar Rate Loan being made,
continued or converted by Royal Bank and with a term equivalent to such Interest
Period would be offered by Royal Bank's London Branch to major banks in the
offshore Dollar market at their request at approximately 11:00 a.m. (London
time) two Business Days prior to the first day of such Interest Period.

         Eurodollar Rate Loan means a Committed Loan that bears interest at a
rate based on the Eurodollar Rate.

         Event of Default means any of the events or circumstances specified in
Article VIII.

         Evergreen Letter of Credit has the meaning specified in Section
2.14(b)(iii).

         Exchange Act means the Securities Exchange Act of 1934, as amended.

         Facilities means, collectively, the Revolver Facility and the Term Loan
Facility; Facility means either of the Revolver Facility or the Term Loan
Facility.

         Family means, in respect of any individual, the heirs, legatees,
descendants and blood relatives to the third degree of consanguinity of such
individual.

         Family Trusts means, in respect of any individual, any trusts for the
exclusive benefit of such individual, his/her spouse and lineal descendants, so
long as such individual has the exclusive right to control each such trust.

         Federal Funds Rate means, for any day, the rate per annum (rounded
upwards to the nearest 1/100 of 1%) equal to the weighted average of the rates
on overnight federal funds transactions with members of the Federal Reserve
System arranged by federal funds brokers on such day, as published by the
Federal Reserve Bank on the Business Day next succeeding such day; provided that
(a) if such day is not a Business Day, the Federal Funds Rate for such day shall
be such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (b) if no such rate is so
published on such next succeeding Business Day, the Federal Funds Rate for such
day shall be the



                                       14
<PAGE>



average rate charged to Royal Bank on such day on such transactions as
determined by the Administrative Agent.

         Fertilizer means fertilizer which is a finished product and ready for
sale.

         First Purchase Payables means the unpaid amount of any payable
obligation of the Borrower or any of the Subsidiaries related to the purchase of
hydrocarbons by the Borrower or any of its Subsidiaries which are (in the
judgment of the Administrative Agent) secured by a statutory Lien, which shall
include but not be limited to the statutory Liens created under the Laws of
Texas, New Mexico, Wyoming, Kansas, and Oklahoma, to the extent such payable
obligation is not at the time in question covered by a Letter of Credit issued
hereunder.

         Fixed Assets means the Vessels, real estate, and all other fixed
assets, as such term is used in accordance with GAAP, owned by the Borrower, or
any of its Subsidiaries.

         Foreign Lender has the meaning specified in Section 10.15.

         Fund means any Person (other than a natural person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.

         GAAP means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or such other principles as may be
approved by a significant segment of the accounting profession, that are
applicable to the circumstances as of the date of determination, consistently
applied. If at any time any change in GAAP would affect the computation of any
financial ratio or requirement set forth in any Loan Document, and either the
Borrower or the Required Lenders shall so request, the Administrative Agent, the
Lenders and the Borrower shall negotiate in good faith to amend such ratio or
requirement to preserve the original intent thereof in light of such change in
GAAP (subject to the approval of the Required Lenders); provided that, until so
amended, (a) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein and (b) the Borrower shall
provide to the Administrative Agent and the Lenders financial statements and
other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such ratio or
requirement made before and after giving effect to such change in GAAP.

         Governmental Authority means any nation or government, any state or
other political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank or other legal
entity exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.

         Guarantors means any Person, including the MLP and every present and
future Subsidiary of Borrower and the MLP, which undertakes to be liable for all
or any part of the Obligations by execution of a Guaranty, or otherwise.

         Guaranty means a Guaranty now or hereafter made by any Guarantor in
favor of the Administrative Agent on behalf of the Lenders, substantially in the
form of Exhibit E-1 or Exhibit E-2, as may be amended from time to time.

         Guaranty Obligation means, as to any Person, (a) any obligation,
contingent or otherwise, of such Person guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other payment obligation of another
Person (the "primary obligor") in any manner, whether directly or indirectly,
and



                                       15
<PAGE>



including any obligation of such Person, direct or indirect, (i) to purchase or
pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other payment obligation, (ii) to purchase or lease property,
securities or services for the purpose of assuring the obligee in respect of
such Indebtedness or other payment obligation of the payment of such
Indebtedness or other payment obligation, (iii) to maintain working capital,
equity capital or any other financial statement condition or liquidity of the
primary obligor so as to enable the primary obligor to pay such Indebtedness or
other payment obligation, or (iv) entered into for the purpose of assuring in
any other manner the obligees in respect of such Indebtedness or other payment
obligation of the payment thereof or to protect such obligees against loss in
respect thereof (in whole or in part), or (b) any Lien on any assets of such
Person securing any Indebtedness or other payment obligation of any other
Person, whether or not such Indebtedness or other payment obligation is assumed
by such Person; provided, however, that the term "Guaranty Obligation" shall not
include endorsements of instruments for deposit or collection in the ordinary
course of business. The amount of any Guaranty Obligation shall be deemed to be
the lesser of (a) an amount equal to the stated or determinable outstanding
amount of the related primary obligation and (b) the maximum amount for which
such guarantying Person may be liable pursuant to the terms of the instrument
embodying such Guaranty Obligation, unless the outstanding amount of such
primary obligation and the maximum amount for which such guarantying Person may
be liable are not stated or determinable, in which case the amount of such
Guaranty Obligation shall be the maximum reasonably anticipated liability in
respect thereof as determined by the guarantying Person in good faith.

         Hazardous Substance means any substance that poses a threat to, or is
regulated to protect, human health, safety, public welfare, or the environment,
including without limitation: (a) any "hazardous substance," "pollutant" or
"contaminant," and any "petroleum" or "natural gas liquids" as those terms are
defined or used under Section 101 of the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended ( 42 U.S.C. Sections 9601 et
seq.) ("CERCLA"), (b) "solid waste" as defined by the federal Solid Waste
Disposal Act (42 U.S.C. Sections 6901 et seq.), (c) asbestos or a material
containing asbestos, (d) any material that contains lead or lead-based paint,
(e) any item or equipment that contains or is contaminated by polychlorinated
biphenyls, (f) any radioactive material, (g) urea formaldehyde, (h) putrescible
materials, (i) infectious materials, (j) toxic microorganisms, including mold,
or (k) any substance the presence or Release of which requires reporting,
investigation or remediation under any Environmental Law.

         Honor Date has the meaning set forth in Section 2.14(c)(i).

         Indebtedness means, as to any Person at a particular time, all of the
following:

         (a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes, loan
agreements or other similar instruments;

         (b) the face amount of all letters of credit (including standby and
commercial), banker's acceptances, Bank Guaranties, surety bonds, and similar
instruments issued for the account of such Person, and, without duplication, all
drafts drawn and unpaid thereunder;

         (c) net obligations under any Swap Contract in an amount equal to (i)
if such Swap Contract has been closed out, the termination value thereof, or
(ii) if such Swap Contract has not been closed out, the marked-to-market value
thereof determined on the basis of readily available quotations provided by any
recognized dealer in such Swap Contract;

         (d) whether or not so included as liabilities in accordance with GAAP,
all obligations of such Person to pay the deferred purchase price of property or
services, other than trade accounts payable in the ordinary course of business
not overdue by more than 60 days, and indebtedness (excluding prepaid



                                       16
<PAGE>



interest thereon) secured by a Lien on property owned or being purchased by such
Person (including indebtedness arising under conditional sales or other title
retention agreements), whether or not such indebtedness shall have been assumed
by such Person or is limited in recourse;

         (e) Capital Leases and Synthetic Lease Obligations;

         (f) Off-Balance Sheet Indebtedness; and

         (g) all Guaranty Obligations of such Person in respect of any of the
foregoing.

         For all purposes hereof, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture in which such Person is a
general partner, unless such Indebtedness is expressly made non-recourse to such
Person except for customary exceptions acceptable to the Required Lenders. The
amount of any Capital Lease or Synthetic Lease Obligation as of any date shall
be deemed to be the amount of Attributable Indebtedness in respect thereof as of
such date.

         Indemnified Liabilities has the meaning set forth in Section 10.05.

         Indemnitees has the meaning set forth in Section 10.05.

         Initial Financial Statements means the financial statements delivered
pursuant to clauses (A) and (B) of Section 4.01(a)(vii).

         Interest Coverage Ratio means, as of any date of determination, the
ratio of (a) Consolidated EBITDA for the period of the four prior fiscal
quarters ending on such date to (b) the sum of (i) Consolidated Interest Charges
during such period and (ii) imputed interest charges on Synthetic Leases, of the
MLP and its Subsidiaries during such period. For purposes of calculating the
Interest Coverage Ratio, Consolidated Interest Charges and imputed interest
charges on Synthetic Leases (A) for the fiscal quarter ending September 30,
2002, shall be the pro forma results of the MLP set forth in the financial
statements provided by the Borrower to the Administrative Agent and to each
Lender, which financial information shall be prepared using a methodology
substantially similar to the methodology used in preparing the pro forma results
of the MLP as set forth in the MLP Registration Statement and (B) for any fiscal
quarter ending on or after December 31, 2002, shall be the actual results of the
MLP as set forth in financial statements filed with the Securities and Exchange
Commission in the Form 10-K or 10-Q (financial results for the period ended
December 31, 2002, shall be adjusted on a pro forma basis as necessary for the
period prior to the MLP Offering Closing), in each case with respect to which
financial statements the Borrower shall have provided a certificate containing
the representations and warranties set forth in Section 5.05(a).

         Interest Payment Date means, (a) as to any Loan other than a Base Rate
Loan, the last day of each Interest Period applicable to such Loan; provided,
however, that if any Interest Period for a Eurodollar Rate Loan exceeds three
months, the respective dates that fall every three months after the beginning of
such Interest Period shall also be Interest Payment Dates; and (b) as to any
Base Rate Loan (including a Swing Line Loan), the last Business Day of each
March, June, September and December and the Maturity Date.

         Interest Period means, as to each Eurodollar Rate Loan, the period
commencing on the date such Eurodollar Rate Loan is disbursed or converted to or
continued as a Eurodollar Rate Loan and ending on the date one, two, three or
six months thereafter, as selected by the Borrower in its Committed Loan Notice;
provided that:



                                       17
<PAGE>



         (a) any Interest Period that would otherwise end on a day that is not a
Business Day shall be extended to the next succeeding Business Day unless, in
the case of a Eurodollar Rate Loan, such Business Day falls in another calendar
month, in which case such Interest Period shall end on the next preceding
Business Day;

         (b) any Interest Period pertaining to a Eurodollar Rate Loan that
begins on the last Business Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at the end of such
Interest Period) shall end on the last Business Day of the calendar month at the
end of such Interest Period; and

         (c) no Interest Period shall extend beyond the scheduled Maturity Date.

         Inventory means, for any of the Borrower and the Subsidiaries, all now
owned or hereafter acquired Fertilizer and liquefied petroleum gas (excluding
line fill), wherever located, held for sale, each valued at the lower of cost or
Market Price, and all documents of title or other documents (as defined in the
U.C.C.) representing them.

         Investment means, as to any Person, any investment by such Person,
whether by means of (a) the purchase or other acquisition of capital stock or
other securities of another Person or (b) a loan, advance or capital
contribution to, guaranty of debt of, or purchase or other acquisition of any
other debt or equity participation or interest in, another Person, including any
partnership or joint venture interest in such other Person. For purposes of
covenant compliance, the amount of any Investment shall be the amount actually
invested, without adjustment for subsequent increases or decreases in the value
of such Investment, less all returns of principal or equity thereon, and shall,
if made by the transfer or exchange of property other than cash be deemed to
have been made in an amount equal to the fair market value of such property.

         Investment Reduction Event means the occurrence of any of the
following: (a) Martin Resource, any Martin Party or any Company ceases to own,
directly or indirectly, (i) 50% of the membership interest in CF Martin Sulphur
General Partner, or (ii) 50% of the ownership interest in any successor entity
that controls the management of CF Martin Sulphur, (b) Borrower's percentage
equity ownership of CF Martin Sulphur is reduced below 49.5% and, as a result of
such reduction, cash distributions received by the Borrower from CF Martin
Sulphur are reduced, or (c) any event occurs which triggers an obligation on the
part of the MLP, the Borrower, or any of their Subsidiaries to purchase from CF
Industries (or an Affiliate of CF Industries) equity interests in CF Martin
Sulphur or CF Martin Sulphur General Partner and such obligation is not timely
satisfied; provided, that a sale of all of the MLP's, the Borrower's, and their
Subsidiaries' equity interests in CF Martin Sulphur or, after such sale, any of
the events set forth in (a) or (b), shall not constitute an Event of Default so
long as prepayments are made as required under Section 2.04.

         IRS means the United States Internal Revenue Service.

         Laws means, collectively, all applicable international, foreign,
federal, state and local statutes, treaties, rules, regulations, ordinances,
codes and administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, licenses, authorizations and permits of, any
Governmental Authority.

         L/C Advance means, with respect to each Lender, such Lender's
participation in any L/C Borrowing in accordance with its Pro Rata Share.



                                       18
<PAGE>



         L/C Borrowing means an extension of credit resulting from a drawing
under any Letter of Credit which has not been reimbursed on the date when made
or refinanced as a Borrowing.

         L/C Credit Extension means, with respect to any Letter of Credit, the
issuance thereof or extension of the expiry date thereof, or the renewal or
increase of the amount thereof.

         L/C Issuer means any affiliate, unit, or agency of Royal Bank or any
other Lender which has agreed to issue one or more Letters of Credit at the
request of the Administrative Agent (which shall, at the Borrower's request,
notify the Borrower from time to time of the identity of such other Lender).

         L/C Obligations means, as at any date of determination, the aggregate
undrawn face amount of all outstanding Letters of Credit plus the aggregate of
all Unreimbursed Amounts, including all L/C Borrowings.

         Lender has the meaning specified in the introductory paragraph hereto
and, as the context requires, includes the L/C Issuer and the Swing Line Lender.

         Lender Hedging Agreement means a Swap Contract between a Company and a
Lender or an Affiliate of a Lender.

         Lending Office means, as to any Lender, the office or offices of such
Lender set forth on its Administrative Questionnaire, or such other office or
offices as a Lender may from time to time notify the Borrower and the
Administrative Agent.

         Letter of Credit means any standby letter of credit issued hereunder.

         Letter of Credit Application means an application and agreement for the
issuance or amendment of a letter of credit in the form from time to time in use
by the L/C Issuer.

         Letter of Credit Expiration Date means the day that is five days prior
to the Maturity Date (or, if such day is not a Business Day, the next preceding
Business Day).

         Letter of Credit Sublimit means an amount equal to the lesser of (a)
the Aggregate Working Capital/Distribution Subfacility Commitments and (b)
$5,000,000. The Letter of Credit Sublimit is part of, and not in addition to,
the Aggregate Working Capital/Distribution Subfacility Commitments.

         Leverage Ratio means, for the MLP and its Subsidiaries on a
consolidated basis, the ratio of (a) Consolidated Funded Debt as of the
determination date to (b) Consolidated EBITDA for the period of the four fiscal
quarters ending on such date, or if such date is not the last day of a fiscal
quarter, ending on the last day of the fiscal quarter most recently ended.

         Lien means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge, or preference,
priority or other security interest or preferential arrangement of any kind or
nature whatsoever to secure or provide for payment of any obligation of any
Person, (including any conditional sale or other title retention agreement, any
financing lease having substantially the same economic effect as any of the
foregoing, and the filing of any financing statement under the Uniform
Commercial Code or comparable Laws of any jurisdiction), including the interest
of a purchaser of accounts receivable.

         Limited Partnership Agreement (Borrower) means the Amended and Restated
Agreement of Limited Partnership of the Borrower, substantially in the form
attached as Exhibit 3.4 to the MLP



                                       19
<PAGE>



Registration Statement, as the same may be amended, restated or otherwise
modified in accordance with Section 7.14.

         Limited Partnership Agreement (MLP) means the First Amended and
Restated Agreement of Limited Partnership of the MLP, substantially in the form
attached as Appendix A to the MLP Registration Statement, as the same may be
amended, restated or otherwise modified in accordance with Section 7.14.

         Loan means an extension of credit by a Lender to the Borrower pursuant
to Section 2.01, Section 2.02 or Section 2.15.

         Loan Documents means this Agreement, each Note, the Master Consent to
Assignment, each of the Collateral Documents, the Agent/Arranger Fee Letter,
each Committed Loan Notice, each Swing Line Notice, each Compliance Certificate,
the Guaranties, any Subordination Agreement, each Letter of Credit Application,
and each other agreement, document or instrument delivered by the Borrower or
any of its Subsidiaries from time to time in connection with this Agreement and
the Notes.

         Loan Party means each of the Borrower, each Guarantor, and each
Borrower Affiliate that executes one or more Loan Documents.

         Majority Lenders means (a) on any date of determination on and after
the Closing Date and prior to the date of the initial Borrowing, those Lenders
holding more than 50% of the Aggregate Commitments, (b) on any date of
determination on and after the date of the initial Borrowing and prior to the
Maturity Date, those Lenders holding more than 50% of the sum of (i) the
Revolver Commitment plus (ii) the Term Loan Principal Debt; and (c) on any date
of determination on or after the Maturity Date, those Lenders holding more than
50% of the Outstanding Amount of Loans.

         Maricopa, Arizona Fertilizer Plant means the fertilizer plant owned and
operated by the Borrower located in Maricopa, Arizona.

         Market Price means on each day a spot price for the Inventory being
valued, determined by published prices and methodology approved by
Administrative Agent from time to time, adjusted to reflect any differences in
grade between the index Inventory and the actual Inventory and to reflect
transportation costs or other appropriate location price differential from the
actual location to the index location.

         Martin Gas Marine means Martin Gas Marine LLC, a Texas limited
liability company.

         Martin Gas Sales means Martin Gas Sales, Inc., a Texas corporation.

         Martin Party means Martin Resource or any Subsidiary of Martin
Resource, other than the MLP General Partner, the MLP, the Borrower General
Partner, the Borrower and its Subsidiaries.

         Martin Resource means Martin Resource Management Corporation, a
Delaware corporation.

         Martin Resource Change of Control means (a) a change resulting in any
person (as such term is used in section 13(d) and section 14(d)(2) of the
Exchange Act) or related persons constituting a group (as such term is used in
Rule 13d-5 under the Exchange Act, but excluding any employee benefit plan of
such person or its subsidiaries, and any person or entity acting in its capacity
as trustee, agent or other fiduciary or administrator of such plan), other than
Martin Resource and the Designated Martin Shareholders, (i) becoming the
"beneficial owners" (as such term is used in Rule 13d-3 under the Exchange Act
as in effect



                                       20
<PAGE>
on the date of the Closing), directly or indirectly, of more than 33 1/3% of the
total voting power of all classes then outstanding of Martin Resource's voting
stock, or (ii) succeeding in having elected, or causing the election or
appointment of at least a majority of the members of the Board of Directors of
Martin Resource with directors not nominated or appointed by the Designated
Martin Shareholders; provided, that, for the purpose of the foregoing
definition, a Person shall not be deemed to "beneficially own" securities
tendered pursuant to a tender or exchange offer made by or on behalf of such
Person or any of such Person's Affiliates until such tendered securities are
accepted for purchase or exchange, or (b) the 120th day after Ruben S. Martin
(or his Successor) or Scott D. Martin (or his Successor) ceases to be President
and Chief Executive Officer of Martin Resource if a Successor is not appointed
to act as President and Chief Executive Officer of Martin Resource within such
120 day period.

         Master Consent to Assignment means the Master Consent to Assignment,
substantially in the form of Exhibit H.

         Material Adverse Effect means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, assets, liabilities
(actual or contingent) or condition (financial or otherwise) of the Borrower and
its Subsidiaries taken as a whole or the MLP and its Subsidiaries taken as a
whole, (b) a material adverse effect on the ability of the Borrower or the MLP
to perform its obligations under the Loan Documents to which it is a party, (c)
a material adverse effect upon the legality, validity, binding effect or
enforceability against the Borrower, the MLP, or any other Loan Party of any
Loan Document, or (d) a material adverse effect on the ability of the
Administrative Agent, the Collateral Agent or the Lenders to enforce its or
their remedies under any Loan Document.

         Material Agreements means the following:

         (a) Contribution Agreement,

         (b) Omnibus Agreement,

         (c) Limited Liability Company Agreement of CF Martin Sulphur General
Partner, dated as of November 22, 2000, as amended,

         (d) Agreement of Limited Partnership of CF Martin Sulphur dated as of
November 22, 2000, as amended,

         (e) Terminal Services Agreement dated as of November 1, 2002, by and
between the Borrower and Martin Gas Sales,

         (f) Contract for Marine Transportation dated as of November 1, 2002, by
and between the Borrower and Martin Resource,

         (g) Product Storage Agreement (Arcadia Storage Facility), dated as of
November 1, 2002, by and between Martin Underground Storage, Inc., a Texas
corporation, and the Borrower,

         (h) Product Supply Agreement dated as of November 1, 2002, by and
between Martin Gas Sales and the Borrower,

         (i) Marine Fuel Agreement dated as of November 1, 2002, by and between
Midstream Fuel Service, LLC, an Alabama limited liability company, and the
Borrower,



                                       21
<PAGE>



         (j) Throughput Agreement dated as of November 1, 2002, by and between
Martin Gas Sales and the Borrower,

         (k) Motor Carrier Agreement dated as of November 1, 2002, by and
between the Borrower and Martin Transport, Inc., a Texas corporation,

         (l) Assignment and Assumption of Lease and Sublease dated as of
November 1, 2002, by and among Martin Gas Sales and the Borrower,

         (m) Lease Agreement dated as of December 16, 1976, as amended, by and
between Tampa Port Authority and Martin Gas Sales,

         (n) Consent and Amendment to Agreement of Limited Partnership of CF
Martin Sulphur dated as of October 25, 2002, by and among CF Martin Sulphur
Holding Corporation, a Nevada corporation, CF Martin Sulphur General Partner, CF
Industries, and the Borrower,

         (o) Contribution Agreement dated as of November 20, 2000, by and
between CF Martin Sulphur, CF Martin Sulphur General Partner, Martin Resource,
Martin Gas Marine, and Martin Transport, Inc.; and

         (p) Stanolind Terminal Agreements;

         (q) any and all other agreements now or hereafter entered into by and
among Martin Resource, the MLP, the Borrower, or any of their respective
Subsidiaries, and CF Industries, or any of its affiliates, material to the
business of CF Martin Sulphur if the termination of such contract could be
reasonably expected to have a Material Adverse Effect, and

         (r) any other contract material to the business of the MLP or the
Borrower to which the Borrower or any Borrower Affiliate is a party if the
termination of such contract could be reasonably expected to have a Material
Adverse Effect. "Material Agreement" means each of such Material Agreements.

         Maturity Date means (a) the Stated Maturity Date, or (b) such earlier
effective date of any other termination, cancellation, or acceleration of all
Commitments under this Agreement.

         Maximum Amount and Maximum Rate respectively mean, for each Lender, the
maximum non-usurious amount and the maximum non-usurious rate of interest which,
under applicable Law, such Lender is permitted to contract for, charge, take,
reserve, or receive on the Obligations.

         Maximum Credit Exposure shall have the meaning set forth in Section
7.15(e).

         Midstream Business means marine transportation, terminalling,
distribution, and midstream logistical services with respect to hydrocarbon
products and by-products, specialty chemicals, and other liquids and manufacture
and marketing of sulphur-based fertilizers and related products and other
businesses reasonably related thereto.

         MLP means Martin Midstream Partners L.P., a Delaware limited
partnership.

         MLP General Partner means the general partner of the MLP. As of the
Closing Date, the general partner of the MLP is Martin Midstream GP LLC, a
Delaware limited liability company.



                                       22
<PAGE>



         MLP Offering means the initial sale to the public of common units in
the MLP pursuant to the MLP Registration Statement.

         MLP Offering Closing means the consummation of the sale of common units
to the public pursuant to the MLP Registration Statement.

         MLP Registration Statement means the Registration Statement on Form S-1
filed on July 1, 2002 with the Securities and Exchange Commission in connection
with the sale of common units in the MLP, as may be amended from time to time.

         Mortgaged Vessels means the vessels described in the Vessel Mortgages.

         Mortgages means the mortgages, deeds of trust, or similar instruments
executed by any of the Loan Parties in favor of the Collateral Agent, for the
benefit of the Lenders, including without limitation, the Vessel Mortgages, and
all supplements, assignments, amendments, and restatements thereto (or any
agreement in substitution therefore, and "Mortgage" means each of such
Mortgages).

         Multiemployer Plan means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA
Affiliate makes or is obligated to make contributions, or during the preceding
three calendar years, has made or been obligated to make contributions.

         Net Cash Proceeds means (a) with respect to any Disposition, cash
(including any cash received by way of deferred payment as and when received and
payment of amounts due under any insurance policy) received by the Borrower or
any of its Subsidiaries in connection with and as consideration therefor, on or
after the date of consummation of such transaction, after (i) deduction of Taxes
payable in connection with or as a result of such transaction, and (ii) payment
of all usual and customary brokerage commissions and all other reasonable fees
and expenses related to such transaction (including, without limitation,
reasonable attorneys' fees and closing costs incurred in connection with such
transaction), and (b) with respect to any Subordinated Indebtedness, proceeds of
such Indebtedness after payment of all reasonable closing costs.

         Net Worth means, as of any date of determination, for the MLP the
difference between (i) net worth of the MLP on that date minus (ii) goodwill of
the MLP on that date in excess of $3,000,000, each determined in accordance with
GAAP.

         Nonrenewal Notice Date has the meaning specified in Section
2.14(b)(iii).

         Notes means the Revolver Notes and the Term Notes of the Borrower,
substantially in the form of Exhibit B-1 and B-2, respectively, hereto,
evidencing the obligation of Borrower to repay the Loans, and "Note" means any
one of such promissory notes issued hereunder.

         Obligations means all advances to, and debts, liabilities, obligations,
covenants and duties of, any Loan Party arising under any Loan Document, whether
direct or indirect (including those acquired by assumption), absolute or
contingent, due or to become due, now existing or hereafter arising and
including interest that accrues after the commencement by or against any Loan
Party of any proceeding under any Debtor Relief Laws naming such Person as the
debtor in such proceeding. In addition, all references to the "Obligations" in
the Collateral Documents and in Sections 2.13 and 10.09 of this Agreement shall,
in addition to the foregoing, also include all present and future indebtedness,
liabilities, and obligations (and all renewals and extensions thereof or any
part thereof) now or hereafter owed to any Lender or any Affiliate of a Lender
arising pursuant to any Lender Hedging Agreement.



                                       23
<PAGE>



         Obligor means the Borrower or any other Person (other than the
Administrative Agent, the Collateral Agent, or any Lender) obligated under any
Loan Document.

         Off-Balance Sheet Indebtedness of a Person means (a) any repurchase
obligation or liability of such Person with respect to accounts or notes
receivable sold by such Person, (b) any liability under any sale and leaseback
transaction which is not a Capital Lease, or (c) any obligation arising with
respect to any other transaction which is the functional equivalent of or takes
the place of borrowing but which does not constitute a liability on the balance
sheets of such Person, but excluding from this clause (c) operating leases.

         Omnibus Agreement means the Omnibus Agreement dated as of November 1,
2002, among the MLP, the Borrower, the MLP General Partner, and Martin Resource
as amended in accordance with Section 7.14.

         Organization Documents means, (a) with respect to any corporation, the
certificate or articles of incorporation and the bylaws; (b) with respect to any
limited liability company, the certificate of formation and operating agreement;
and (c) with respect to any partnership, joint venture, trust or other form of
business entity, the partnership, joint venture or other applicable agreement of
formation and any agreement, instrument, filing or notice with respect thereto
filed in connection with its formation with the secretary of state or other
department in the state of its formation, in each case as amended from time to
time.

         Other Taxes has the meaning specified in Section 3.01(b).

         Outstanding Amount on any date (i) with respect to Committed Loans and
Swing Line Loans, means the aggregate outstanding principal amount thereof after
giving effect to any Borrowings and prepayments or repayments occurring on such
date, (ii) with respect to any L/C Obligations, the amount of such L/C
Obligations on such date after giving effect to any L/C Credit Extension
occurring on such date and any other changes in the aggregate amount of the L/C
Obligations as of such date, including as a result of any reimbursements of
outstanding unpaid drawings under any Letters of Credit or any reductions in the
maximum amount available for drawing under Letters of Credit taking effect on
such date, and (iii) for purposes of Section 2.11(d) with respect to Obligations
under a Lender Hedging Agreement, means the amount then due and payable under
such Lender Hedging Agreement.

         Participant has the meaning specified in Section 10.07(d).

         PBGC means the Pension Benefit Guaranty Corporation.

         Pension Plan means any "employee pension benefit plan" (as such term is
defined in Section 3(2)(A) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by the Borrower or
any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes
or has an obligation to contribute, or in the case of a multiple employer plan
(as described in Section 4064(a) of ERISA) has made contributions at any time
during the immediately preceding five plan years.

         Permitted Acquisition means an Acquisition or Investment by the
Borrower or a Subsidiary of the Borrower resulting in ownership of assets inside
the United States, or of equity interests in a Domestic Person, so long as the
following requirements have been satisfied:



                                       24
<PAGE>
         (a) Such Investment results in the Borrower's ownership of a Subsidiary
(or such Investment is an Investment in an existing Subsidiary), and the
Borrower shall have complied with the requirements of Sections 6.15 and 6.18 as
of the date of such Investment;

         (b) If a Borrowing is to be made under the Acquisition Subfacility in
connection with such Acquisition or Investment, not less than fourteen (14) days
prior to the closing of such Acquisition or Investment, the Borrower shall (i)
in the case of an Investment in equity interests, deliver historical financial
statements of the acquisition target, (ii) deliver to the Administrative Agent
pro forma financial statements acceptable to the Administrative Agent and a
certificate of a Responsible Officer of the Borrower demonstrating pro forma
compliance with Section 7.15 as of the closing of such Acquisition or Investment
after giving effect thereto and after giving effect to any Indebtedness
(including Obligations) incurred in connection therewith, and (iii) deliver to
the Administrative Agent an Appraisal not more than six months old of newly
acquired Fixed Assets of the Borrower and the Guarantors after giving effect to
such Acquisition or Investment;

         (c) Each Investment shall have been approved or consented to by the
board of directors or similar governing entity of the Person being acquired; and

         (d) As of the closing of such Acquisition or Investment no Default or
Event of Default shall exist or occur as a result of, and after giving effect
to, such Acquisition or Investment.

         Permitted Inventory Liens has the meaning set forth in the definition
of Eligible Inventory.

         Permitted Liens means Liens permitted under Section 7.01 as described
in such Section.

         Person means any natural person, trustee, corporation, general
partnership, limited partnership, limited liability company, joint stock
company, trust, unincorporated organization, bank, business association, firm,
joint venture, Governmental Authority, company or other entity.

         Plan means any "employee benefit plan" (as such term is defined in
Section 3(3) of ERISA) established by the Borrower or any ERISA Affiliate.

         Principal Payment means a payment of principal (or, in the case of a
Capitalized Lease or a Synthetic Lease, Attributable Indebtedness), whether
pursuant to an amortization schedule, at maturity, or otherwise.

         Pro Rata Share means, at any date of determination, for any Lender with
respect to a particular Facility or Subfacility, the percentage (carried out to
the ninth decimal place) that its Committed Sum for such Facility or Subfacility
bears to the aggregate Committed Sums of all Lenders for such Facility or
Subfacility.

         Proceeds Account has the meaning set forth in Section 2.04(b)(iii).

         Purchase Price means, with respect to any Acquisition, all direct,
indirect, and deferred cash and non-cash payments made to or for the benefit of
the Person being acquired (or whose assets are being acquired), its
shareholders, officers, directors, employees, or Affiliates in connection with
such Acquisition, including, without limitation, the amount of any Indebtedness
being assumed in connection with such Acquisition and (subject to the
limitations on Indebtedness hereunder) seller financing, payments under
non-competition or consulting agreements entered into in connection with such
Acquisition and similar agreements, all non-cash consideration and the value of
any stock, options, or warrants or other rights to acquire stock issued as part
of the consideration in such transaction.



                                       25
<PAGE>



         Purchased Assets means the assets purchased from Martin Resource and
its Subsidiaries and transferred to the MLP, the Borrower, and their respective
subsidiaries pursuant to the Contribution Agreement.

         Quarterly Distributions means with respect to the Borrower, the
distributions by the Borrower of Available Cash (as defined in the Limited
Partnership Agreement (Borrower) as in effect on the Closing Date) or with
respect to MLP, the distributions by the MLP of Available Cash (as defined in
the Limited Partnership Agreement (MLP) as in effect on the Closing Date).

         Reduction Amount has the meaning set forth in the definition of
Triggering Sale.

         Register has the meaning set forth in Section 10.07(c).

         Reinvested means used for capital expenditures or Acquisitions in
connection with the Midstream Business of a Company.

         Related Parties means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees, agents,
and advisors of such Person and such Person's Affiliates.

         Release means any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, disposal,
deposit, dispersal, migrating, or other movement into the air, ground, or
surface water, or soil.

         Reportable Event means any of the events set forth in Section 4043(c)
of ERISA, other than events for which the 30 day notice period has been waived.

         Request for Credit Extension means (a) with respect to a Borrowing,
conversion or continuation of Committed Loans, a Committed Loan Notice, (b) with
respect to an L/C Extension, a Letter of Credit Application, and (c) with
respect to a Swing Line Loan, a Swing Line Notice.

         Required Lenders means (a) on any date of determination on and after
the Closing Date and prior to the date of the initial Borrowing, those Lenders
holding more than 66 2/3% of the Aggregate Commitments, (b) on any date of
determination on and after the date of the initial Borrowing and prior to the
Maturity Date, those Lenders holding more than 66 2/3% of the sum of (i) the
Revolver Commitment plus (ii) the Term Loan Principal Debt; and (c) on any date
of determination on or after the Maturity Date, those Lenders holding more than
66 2/3% of the Outstanding Amount of Loans.

         Required Revolver Lenders means (a) on any date of determination on and
after the Closing Date and prior to the date of the initial Borrowing, those
Lenders holding more than 66 2/3% of the (i) Acquisition Subfacility Commitment
and (ii) Working Capital/Distribution Subfacility Commitment (b) on any date of
determination on and after the date of the initial Borrowing and prior to the
Maturity Date, those Lenders holding more than 66 2/3% of the Revolver
Commitment; and (c) on any date of determination on or after the Maturity Date,
those Lenders holding more than 66 2/3% of the Revolver Principal Debt.

         Required Term Lenders means (a) on any date of determination on and
after the Closing Date and prior to the date of the initial Borrowing, those
Lenders holding more than 66 2/3% of the Term Loan Facility Commitment (b) on
any date of determination on and after the date of the initial Borrowing and
prior to the Maturity Date, those Lenders holding more than 66 2/3% of the Term
Loan Committed Sum;



                                       26
<PAGE>



and (c) on any date of determination on or after the Maturity Date, those
Lenders holding more than 66 2/3% of the Term Loan Principal Debt.

         Responsible Officer means the president, chief executive officer, chief
financial officer, controller, treasurer or assistant treasurer of a Person. Any
document delivered hereunder that is signed by a Responsible Officer of a Loan
Party shall be conclusively presumed to have been authorized by all necessary
corporate, partnership, limited liability company, and/or other action on the
part of such Loan Party and such Responsible Officer shall be conclusively
presumed to have acted on behalf of such Loan Party.

         Restricted Payment by a Person means any dividend or other distribution
(whether in cash, securities or other property) with respect to any equity
interest in such Person, or any payment (whether in cash, securities or other
property), including any sinking fund or similar deposit on account of the
purchase, redemption, retirement, acquisition, cancellation or termination of
any such equity interest or of any option, warrant or other right to acquire any
such equity interest.

         Restoration Plan means a plan approved by the Administrative Agent
under which the Borrower will use Net Cash Proceeds received as the result of
payments made as a result of any condemnation or Vessel requisition or under
insurance policies to repair, replace, restore, or purchase substitute property
for property that has been damaged or destroyed. Such approval shall not be
unreasonably, conditioned, delayed or withheld.

         Revolver Commitment means an amount (subject to reduction or
cancellation as herein provided) equal to the sum of (i) the Working
Capital/Distribution Subfacility Commitment, plus (ii) the Acquisition
Subfacility Commitment, or as the context may require, means the Lenders'
commitments to make Loans under the Revolver Facility pursuant to Section 2.01.

         Revolver Facility means the credit facility as described in and subject
to the limitations set forth in Section 2.01.

         Revolver Lender means, on any date of determination, any Lender that
has a Committed Sum under the Revolver Facility or that is owed any Revolver
Principal Debt.

         Revolver Note means a promissory note in substantially the form of
Exhibit B-1, and all renewals and extensions of all or any part thereof.

         Revolver Principal Debt means, on any date of determination, the
aggregate unpaid principal balance of all Committed Loans under the Revolver
Facility.

         Rights means rights, remedies, powers, privileges, and benefits.

         Royal Bank means Royal Bank of Canada.

         Security Agreements means, collectively, the security agreements, or
similar instruments, executed by any of the Loan Parties in favor of the
Collateral Agent for the benefit of the Lenders, and all supplements,
assignments, amendments, and restatements thereto (or any agreement in
substitution therefore), and "Security Agreement" means each of such Security
Agreements.

         Stanolind Terminal Agreements means the agreements described on
Schedule 1.01(c).



                                       27
<PAGE>



         Stated Maturity Date means November 4, 2005.

         Subfacilities means, collectively, the Acquisition Subfacility and the
Working Capital/Distribution Subfacility; Subfacility means either of the
Acquisition Subfacility or the Working Capital/Distribution Subfacility.

         Subordinated Indebtedness has the meaning set forth in Section 7.04(b).

         Subordination Agreement has the meaning set forth in Section 7.04(b).

         Subsidiary of a Person means a corporation, partnership, joint venture,
limited liability company or other business entity of which a majority of the
shares of securities or other interests having ordinary voting power for the
election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or both,
by such Person. For avoidance of doubt, the Borrower's current 49.5% limited
partnership interest in CF Martin Sulphur does not constitute "control." Unless
otherwise specified, all references herein to a "Subsidiary" or to
"Subsidiaries" shall refer to a Subsidiary or Subsidiaries of the Borrower.

         Successor means any Person approved by the Administrative Agent and the
Required Lenders. A Successor shall be approved by the Administrative Agent and
the Required Lenders if such Person has adequate industry experience and such
approval shall not be unreasonably, conditioned, delayed or withheld.

         Swap Contract means (a) any and all rate swap transactions, basis
swaps, credit derivative transactions, forward rate transactions, commodity
swaps, commodity options, forward commodity contracts, equity or equity index
swaps or options, bond or bond price or bond index swaps or options or forward
bond or forward bond price or forward bond index transactions, interest rate
options, forward foreign exchange transactions, cap transactions, floor
transactions, collar transactions, currency swap transactions, cross-currency
rate swap transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a "Master Agreement"), including
any such obligations or liabilities under any Master Agreement.

         Swap Termination Value means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a) the amount(s) determined as the
mark-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include any Lender).

         Swing Line means the revolving credit facility made available by the
Swing Line Lender pursuant to Section 2.15.



                                       28
<PAGE>



         Swing Line Borrowing means a Borrowing of a Swing Line Loan pursuant to
Section 2.15.

         Swing Line Lender means Royal Bank of Canada in its capacity as
provider of Swing Line Loans, or any successor swing line lender hereunder.

         Swing Line Loan has the meaning specified in Section 2.15(a).

         Swing Line Loan Notice means a notice of a Swing Line Borrowing
pursuant to Section 2.15(b), which, if in writing, shall be substantially in the
form of Exhibit J.

         Swing Line Sublimit means an amount equal to the lesser of (a)
$3,500,000 and (b) the Working Capital/Distribution Subfacility Commitments. The
Swing Line Sublimit is part of, and not in addition to, the Working
Capital/Distribution Subfacility Commitments.

         Synthetic Lease Obligation means the monetary obligation of a Person
under (a) a so-called synthetic or tax retention lease, or (b) an agreement for
the use or possession of property creating obligations that do not appear on the
balance sheet of such Person but which are depreciated for tax purposes by such
Person. The amount of any Synthetic Lease Obligation as of any date shall be
deemed to be the amount of Attributable Indebtedness in respect thereof as of
such date.

         Taxes has the meaning set forth in Section 3.01.

         Term Lender means, on any date of determination, any Lender that has a
Committed Sum under the Term Loan Facility or that is owed any Term Loan
Principal Debt.

         Term Loan Commitment means an amount (subject to reduction or
cancellation as herein provided) equal to $25,000,000.

         Term Loan Facility means the credit facility as described in and
subject to the limitations set forth in Section 2.02.

         Term Note means a promissory note substantially in the form of Exhibit
B-2, and all renewals and extensions of all or any part thereof.

         Term Loan Principal Debt means, on any date of determination, the
aggregate unpaid principal balance of all Committed Loans under the Term Loan
Facility.

         Threshold Amount at any time means an amount equal to 5% of the
Borrower's consolidated assets measured as of the close of the then most recent
fiscal quarter end.

         Triggering Sale means any Disposition (including sales of stock of
Subsidiaries) (other than a transfer of assets by the Borrower or any Subsidiary
of the Borrower to the Borrower or to a Wholly-Owned Subsidiary of the Borrower)
with respect to which the Net Cash Proceeds realized by any Company for such
Disposition, when aggregated with the Net Cash Proceeds from all such other
Dispositions by all Companies occurring since the Closing Date, equals or
exceeds the Threshold Amount. The portion of the Net Cash Proceeds in excess of
the Threshold Amount is herein called the "Reduction Amount." For purposes of
the definition Triggering Sale and Section 2.04(b)(i) and (iii), Dispositions
shall not include Dispositions permitted by Section 7.07(a), (b), or (c).

         Type means, with respect to a Committed Loan, its character as a Base
Rate Loan or a Eurodollar Rate Loan.



                                       29
<PAGE>



         U.C.C. means the Uniform Commercial Code, as in effect in the state of
New York.

         Unauthorized Assignment means (a) an assignment by a Martin Party to
any Person other than another Martin Party of any of its rights or obligations
under a Material Agreement if such assignment could reasonably be expected to
have a Material Adverse Effect, or (b) a holder of Liens shall foreclose or
there shall occur a transfer in lieu of foreclosure or other involuntary
transfer of any interests of a Martin Party in a Material Agreement if such
foreclosure could reasonably be expected to have a Material Adverse Effect.

         Unfunded Pension Liability means the excess of a Pension Plan's benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of that
Pension Plan's assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Code for the applicable
plan year.

         Unreimbursed Amount has the meaning set forth in Section 2.14(c)(i).

         U.S. Flag Vessels shall have the meaning set forth in Section 5.21(a).

         U.S. Vessel Mortgage means the First Preferred Fleet Mortgage executed
and delivered by the Borrower on or before the Conditions Effective Date and the
First Preferred Fleet Mortgage executed by Martin Gas Marine on or before the
Conditions Effective Date, each substantially in the form attached as Exhibit K.

         Vessel Mortgages means, collectively, the U.S. Vessel Mortgage and any
other vessel mortgage now or hereafter executed by any of the Borrower, the MLP,
or their Subsidiaries to the Collateral Agent for the benefit of the Lenders.

         Vessel(s) means all vessels owned by the Borrower, the MLP, and their
Subsidiaries, from time to time, including, without limitation those vessels
listed on Schedule 5.21 and individually, any of such vessels.

         Voting Stock means the capital stock (or equivalent thereof) of any
class or kind, of a Person, the holders of which are entitled to vote for the
election of directors, managers, or other voting members of the governing body
of such Person.

         Wholly-Owned when used in connection with a Person means any Subsidiary
of such Person of which all of the issued and outstanding equity interests
(except shares required as directors' qualifying shares) shall be owned by such
Person or one or more of its Wholly-Owned Subsidiaries.

         Working Capital/Distribution Subfacility has the meaning specified in
Section 2.01(c).

         Working Capital/Distribution Subfacility Commitment means an amount
equal to the lesser of (i) the Borrowing Base (Working Capital/Distribution
Subfacility) and (ii) (subject to reduction or cancellation as herein provided)
$25,000,000.

         SECTION 1.02 OTHER INTERPRETIVE PROVISIONS.

         (a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.



                                       30
<PAGE>



         (b) (i) The words "herein" and "hereunder" and words of similar import
when used in any Loan Document shall refer to such Loan Document as a whole and
not to any particular provision thereof.

                  (ii) Unless otherwise specified herein, Article, Section,
         Exhibit and Schedule references are to this Agreement.

                  (iii) The term "including" is by way of example and not
         limitation.

                  (iv) The term "documents" includes any and all instruments,
         documents, agreements, certificates, notices, reports, financial
         statements and other writings, however evidenced.

         (c) In the computation of periods of time from a specified date to a
later specified date, the word "from" means "from and including;" the words "to"
and "until" each mean "to but excluding;" and the word "through" means "to and
including."

         (d) Section headings herein and the other Loan Documents are included
for convenience of reference only and shall not affect the interpretation of
this Agreement or any other Loan Document.

         SECTION 1.03 ACCOUNTING TERMS. All accounting terms not specifically or
completely defined herein shall be construed in conformity with, and all
financial data required to be submitted pursuant to this Agreement shall be
prepared in conformity with, GAAP applied on a consistent basis, as in effect
from time to time, applied in a manner consistent with that used in preparing
the audited financial statements, except as otherwise specifically prescribed
herein.

         SECTION 1.04 ROUNDING. Any financial ratios required to be maintained
by the Borrower pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio is expressed herein and
rounding the result up or down to the nearest number (with a rounding-up if
there is no nearest number).

         SECTION 1.05 REFERENCES TO AGREEMENTS AND LAWS. Unless otherwise
expressly provided herein, (a) references to agreements (including the Loan
Documents) and other contractual instruments shall be deemed to include all
subsequent amendments, restatements, extensions, supplements and other
modifications thereto, but only to the extent that such amendments,
restatements, extensions, supplements and other modifications are not prohibited
by any Loan Document; and (b) references to any Law shall include all statutory
and regulatory provisions consolidating, amending, replacing, supplementing or
interpreting such Law.

                                   ARTICLE II.
                         THE COMMITMENTS AND BORROWINGS

         SECTION 2.01 REVOLVER LOANS.

         (a) Subject to and in reliance upon the terms, conditions,
representations, and warranties in the Loan Documents, each Lender severally,
but not jointly, agrees to make loans (each such Loan a "Committed Loan") to the
Borrower from time to time on any Business Day during the period from the
Conditions Effective Date to the Maturity Date (the "Availability Period"), in
an aggregate amount not to exceed at any time outstanding the amount of such
Lender's Pro Rata Share of one or more Committed Borrowings under (i) the
Acquisition Subfacility (further described in Section 2.01(b) below) not to
exceed such Lender's Committed Sum under the Acquisition Subfacility, and (ii)
the Working



                                       31
<PAGE>



Capital/Distribution Subfacility (further described in Section 2.01(c) below)
not to exceed, when aggregated with the Outstanding Amount of the L/C
Obligations and Swing Line Loans, such Lender's Committed Sum under the Working
Capital/Distribution Subfacility. Such Committed Borrowings may be repaid and
reborrowed from time to time in accordance with the terms and provisions of the
Loan Documents; provided that, each such Committed Borrowing must occur on a
Business Day and no later than the Business Day immediately preceding the
Maturity Date.

         (b) Committed Loans under the Acquisition Subfacility shall be
available to Borrower for the purposes set forth in Section 6.12(b). After
giving effect to any Committed Borrowing under the Acquisition Subfacility, the
aggregate Outstanding Amount of all Committed Loans under the Acquisition
Subfacility shall not exceed the Acquisition Subfacility Commitment then in
effect.

         (c) Committed Loans under the Working Capital/Distribution Subfacility
shall be available to Borrower for the purposes set forth in Section 6.12(c);
provided, however, Committed Borrowings under the Working Capital/Distribution
Subfacility will be available to fund not more than $2,500,000 in Distribution
Loans in any four (4) consecutive fiscal quarters. After giving effect to any
Committed Borrowing under the Working Capital/Distribution Subfacility, the
aggregate Outstanding Amount of all Committed Loans, Swing Line Loans, and L/C
Obligations under the Working Capital/Distribution Subfacility shall not exceed
the Working Capital/Distribution Subfacility Commitment then in effect.

         SECTION 2.02 TERM LOAN FACILITY. Subject to and in reliance upon the
terms, conditions, representations, and warranties in the Loan Documents, each
Lender severally, but not jointly, agrees to make Committed Loans to Borrower in
a single disbursement on the Conditions Effective Date in aggregate amount not
to exceed at any time outstanding the amount of such Lender's Pro Rata Share of
the Term Loan Commitment. If all or a portion of the Term Loan Principal Debt is
paid or prepaid, then the amount so paid or prepaid may not be reborrowed. Any
portion of the Term Loan Commitment that remains undisbursed after the initial
disbursement under the Term Loan Facility shall be reduced to zero and cancelled
on the date of such initial disbursement.

         SECTION 2.03 BORROWINGS, CONVERSIONS AND CONTINUATIONS OF LOANS.

         (a) Each Committed Borrowing, each conversion of Committed Loans from
one Type to the other, and each continuation of Committed Loans as the same Type
shall be made upon the Borrower's irrevocable notice to the Administrative
Agent, which may be given by telephone. Each such notice must be received by the
Administrative Agent not later than 12:00 noon, New York, New York time, (i)
three Business Days prior to the requested date of any Borrowing of, conversion
to or continuation of Eurodollar Rate Loans, and (ii) one Business Day prior to
the conversion of Eurodollar Rate Loans to Base Rate Committed Loans, or one
Business Day prior to the requested date of any Borrowing of Base Rate Committed
Loans. Each such telephonic notice must be confirmed promptly by delivery to the
Administrative Agent of a written Committed Loan Notice, appropriately completed
and signed by an authorized officer of the Borrower. Each Committed Borrowing
of, conversion to or continuation of Eurodollar Rate Loans shall be in a
principal amount of $2,000,000 or a whole multiple of $1,000,000 in excess
thereof. Each Committed Borrowing of or conversion to Base Rate Committed Loans
shall be in a principal amount of $2,000,000 or a whole multiple of $1,000,000
in excess thereof. Each Committed Loan Notice (whether telephonic or written)
shall specify (i) whether the Committed Borrowing, conversion or continuation
(as applicable) is under the Term Loan Facility, the Acquisition Subfacility or
the Working Capital/Distribution Subfacility, (ii) whether the Borrower is
requesting a Committed Borrowing, a conversion of Committed Loans from one Type
to the other, or a continuation of Committed Loans as the same Type, (iii) the
requested date of the Committed Borrowing, conversion or continuation, as the
case may be (which shall be a Business Day), (iv) the principal amount of
Committed Loans to be borrowed, converted or continued, (v) the Type of
Committed Loans to be borrowed or to



                                       32
<PAGE>



which existing Committed Loans are to be converted, and (vi) if applicable, the
duration of the Interest Period with respect thereto. If the Borrower fails to
specify a Type of Committed Loan in a Committed Loan Notice or if the Borrower
fails to give a timely notice requesting a conversion or continuation, then the
applicable Committed Loans shall be made or continued as, or converted to, Base
Rate Loans. Any such automatic conversion to Base Rate Loans shall be effective
as of the last day of the Interest Period then in effect with respect to the
applicable Eurodollar Rate Loans. If the Borrower requests a Committed Borrowing
of, conversion to, or continuation of Eurodollar Rate Loans in any such
Committed Loan Notice, but fails to specify an Interest Period, it will be
deemed to have specified an Interest Period of one month.

         (b) Following receipt of a Committed Loan Notice, the Administrative
Agent shall promptly notify each Lender of its Pro Rata Share of the applicable
Committed Loans, and if no timely notice of a conversion or continuation is
provided by the Borrower, the Administrative Agent shall notify each Lender of
the details of any automatic conversion to Base Rate Committed Loans described
in the preceding subsection. In the case of a Committed Borrowing, each Lender
shall make the amount of its Committed Loan available to the Administrative
Agent in immediately available funds at the Administrative Agent's Office not
later than 12:00 Noon, New York, New York time, on the Business Day specified in
the applicable Committed Loan Notice. Upon satisfaction of the applicable
conditions set forth in Section 4.03 (and, if such Committed Borrowing is the
initial Credit Extension, Section 4.01), the Administrative Agent shall make all
funds so received available to the Borrower in like funds as received by the
Administrative Agent either by (i) crediting the account of the Borrower on the
books of Royal Bank with the amount of such funds or (ii) wire transfer of such
funds, in each case in accordance with instructions provided to the
Administrative Agent by the Borrower; provided, however, that if, on the date of
the Committed Borrowing there are Swing Line Loans or L/C Borrowings
outstanding, then the proceeds of such Borrowing shall be applied, first, to the
payment in full of any such L/C Borrowings, second, to the payment in full of
any such Swing Line Loans, and third to the Borrower as provided above.

         (c) Except as otherwise provided herein, a Eurodollar Rate Loan may be
continued or converted only on the last day of the Interest Period for such
Eurodollar Rate Loan. During the existence of a Default or Event of Default, no
Loans may be requested as, converted to or continued as Eurodollar Rate Loans
without the consent of the Required Lenders, and the Required Lenders may demand
that any or all of the then outstanding Eurodollar Rate Loans be converted
immediately to Base Rate Loans.

         (d) The Administrative Agent shall promptly notify the Borrower and the
Lenders of the interest rate applicable to any Eurodollar Rate Loan upon
determination of such interest rate. The determination of the Eurodollar Rate by
the Administrative Agent shall be conclusive in the absence of manifest error.

         (e) After giving effect to all Committed Borrowings, all conversions of
Loans from one Type to the other, and all continuations of Committed Loans as
the same Type, there shall not be more than six (6) Interest Periods in effect
at any given time with respect to Committed Loans.

         SECTION 2.04 PREPAYMENTS.

         (a) Optional Prepayments. The Borrower may, upon notice to the
Administrative Agent, at any time or from time to time voluntarily prepay in
whole or in part Committed Loans outstanding under the Acquisition Subfacility,
the Working Capital/Distribution Subfacility and/or the Term Loan Principal Debt
without premium or penalty; provided that (i) such notice must be received by
the Administrative Agent not later than 10:00 a.m., New York, New York time, (A)
three Business Days prior to any date of prepayment of Eurodollar Rate Loans,
and (B) the date of prepayment of Base Rate Committed Loans;



                                       33
<PAGE>



(ii) any prepayment of Eurodollar Rate Loans shall be in a principal amount of
$2,000,000 or a whole multiple of $1,000,000 in excess thereof; and (iii) any
prepayment of Base Rate Committed Loans shall be in a principal amount of
$2,000,000 or a whole multiple of $1,000,000 in excess thereof. Each such notice
shall specify the date and amount of such prepayment and the Type(s) of
Committed Loans to be prepaid. The Administrative Agent will promptly notify
each Lender of its receipt of each such notice, and of such Lender's Pro Rata
Share of such prepayment. If such notice is given by the Borrower, the Borrower
shall make such prepayment and the payment amount specified in such notice shall
be due and payable on the date specified therein. Any prepayment of a Eurodollar
Rate Loan shall be accompanied by all accrued interest thereon, together with
any additional amounts required pursuant to Section 3.05. Each such prepayment
shall be applied to the Committed Loans of the Lenders in accordance with their
respective Pro Rata Shares.

         Unless a Default or Event of Default has occurred and is continuing or
would arise as a result thereof, any payment or prepayment of the Committed
Loans may be reborrowed under the Revolver Facility by the Borrower, subject to
the terms and conditions hereof.

         (b) Mandatory Prepayments from Net Cash Proceeds.

                  (i) (A) Except as provided in clause (B) with respect to
         condemnation, Vessel requisition, or insurance proceeds, if any portion
         of the Net Cash Proceeds realized by a Company from any Triggering Sale
         (including any deferred purchase price therefore) has not been
         Reinvested within one hundred eighty (180) days from the receipt by
         such Company of such Net Cash Proceeds (including receipt of any
         deferred payments for any such Triggering Sale or portion thereof, if
         and when received), then on the Business Day following such one hundred
         eightieth (180th) day the Commitments shall be permanently reduced, and
         the Loans shall be prepaid, in an amount equal to the portion of the
         Reduction Amount that is not so Reinvested. (B) If any portion of the
         Net Cash Proceeds realized by a Company from any Triggering Sale
         received as the result of payments made as a result of any condemnation
         or Vessel requisition or under any insurance policy has not been used
         in connection with a Restoration Plan, then on the Business Day
         following the time period for restoration specified in the Restoration
         Plan the Commitments shall be permanently reduced, and the Loans shall
         be prepaid, in an amount equal to the portion of the Reduction Amount
         remaining on deposit in the Proceeds Account. Net Cash Proceeds of a
         Disposition that equal, when aggregated with Net Cash Proceeds of all
         Dispositions since the Closing Date, an amount less than the Threshold
         Amount shall not be required to be used for mandatory prepayments or
         commitment reductions pursuant to this Section 2.04(b).

                  (ii) If any Net Cash Proceeds are received by a Company (A)
         from the issuance or incurrence of Subordinated Indebtedness by a
         Company, (B) from the Disposition of any equity interests in CF Martin
         Sulphur owned by a Company, or (C) in respect of the dissolution of CF
         Martin Sulphur, the Loans shall be prepaid and, in the case of clause
         (A), the Commitments shall be permanently reduced, immediately upon
         receipt of such Net Cash Proceeds in an amount equal to the amount of
         Net Cash Proceeds received in respect of such Subordinated
         Indebtedness, Disposition, or dissolution whether or not such
         Disposition or dissolution qualifies as a Triggering Sale.

                  (iii) Upon receipt by any Company of Net Cash Proceeds from a
         Triggering Sale, the Borrower shall (or shall cause the applicable
         Company to) deposit an amount equal to the Reduction Amount into an
         account or accounts with the Collateral Agent (collectively, the
         "Proceeds Account"); provided, however, that the Borrower shall not be
         required to deposit an amount that is more than the amount of the
         Commitments. In the case of Section 2.04(b)(i)(A), such Reduction
         Amount shall remain in the Proceeds Account until the earlier of (x)
         the date such



                                       34
<PAGE>



         Reduction Amount is Reinvested, or (y) the one hundred eightieth
         (180th) day following the receipt of such Reduction Amount. If such
         Reduction Amount is not Reinvested as herein provided, such proceeds
         shall, on the Business Day following such one hundred eightieth (180th)
         day, be used for prepayment of Loans and any excess shall be refunded
         to the Borrower, or, if there are no outstanding Loans or unpaid
         outstanding Obligations then due, such Reduction Amount shall be
         refunded to the Borrower, and the Commitments shall be permanently
         reduced as provided in Section 2.04(b)(i); provided, however, that if
         the outstanding Loans are Eurodollar Rate Loans, the Collateral Agent
         shall hold such proceeds in the Proceeds Account until the Eurodollar
         Rate Loans can be prepaid without incurring funding losses under
         Section 3.05; provided, further, that if the Loans have become due and
         payable pursuant to Section 8.02 or otherwise, the Collateral Agent
         shall, upon the request of the Administrative Agent, deliver funds from
         the Proceeds Account to the Administrative Agent which may, without
         notice, apply all such funds to the repayment of the Obligations. In
         the case of Section 2.04(b)(i)(B), such Reduction Amount shall remain
         in the Proceeds Account until the earlier of (x) the date such
         Reduction Amount is to be applied in connection with the applicable
         Restoration Plan, or (y) the Business Day following the final day of
         the applicable Restoration Plan (or in the absence of an applicable
         Restoration Plan delivered pursuant to Section 6.07, on a date
         identified by the Administrative Agent which shall not be earlier than
         180 days after the receipt of such Reduction Amount). If such Reduction
         Amount is not used in connection with a Restoration Plan, such proceeds
         shall, on the Business Day following the last day of the applicable
         Restoration Plan or on a date chosen by the Administrative Agent (which
         shall not be earlier than 180 days after the receipt of such Reduction
         Amount), as appropriate, be used for prepayment of Loans and any excess
         shall be refunded to the Borrower, or, if there are no outstanding
         Loans or unpaid outstanding Obligations then due, such Reduction Amount
         shall be refunded to the Borrower, and the Commitments shall be
         permanently reduced as provided in Section 2.04(b)(i); provided,
         however, that if the outstanding Loans are Eurodollar Rate Loans, the
         Collateral Agent shall hold such proceeds in the Proceeds Account until
         the Eurodollar Rate Loans can be prepaid without incurring funding
         losses under Section 3.05; provided, further, that if the Loans have
         become due and payable pursuant to Section 8.02 or otherwise, the
         Collateral Agent, upon the request of the Administrative Agent, shall
         deliver funds from the Proceeds Account to the Administrative Agent
         which may, without notice, apply all funds in the Proceeds Account to
         repayment of the Obligations.

                  (iv) The prepayments and commitment reductions provided for in
         this Section 2.04(b) shall be applied as follows, unless a Default or
         Event of Default has occurred and is continuing or would arise as a
         result thereof (whereupon the provisions of Section 2.11(d) shall
         apply): (A) first, as a payment of all Unreimbursed Amounts then
         outstanding, until paid in full, (B) second, as a repayment of all
         Swing Line Loans, then outstanding, until paid in full, (c) third, as a
         repayment of the Term Loan Principal Debt, until paid in full, and (D)
         fourth, as a repayment of Revolver Principal Debt, to be allocated on a
         pro rata basis between the Acquisition Subfacility and the Working
         Capital/Distribution Subfacility. If any prepayments of Revolver
         Principal Debt pursuant to Section 2.04(b)(ii) are made, the Revolver
         Commitment shall be permanently reduced by the amount of such
         prepayments on a pro rata basis between the Acquisition Subfacility and
         the Working Capital Distribution Subfacility.

                  (v) All funds held in the Proceeds Account shall be invested
         in time deposits or certificates of deposit issued by the
         Administrative Agent or in investments that constitute Cash Equivalents
         (provided that the maturities thereof shall not exceed 180 days). All
         interest and income earned on the amounts held in the Proceeds Account
         shall be paid to the Borrower at the time the funds therein are applied
         as provided in this Section 2.04(b).



                                       35
<PAGE>



                  (vi) The Borrower hereby grants to the Collateral Agent, for
         the benefit of the Lenders, a lien on and security interest in and to
         the Proceeds Account and all monies, cash, checks, drafts, certificates
         of deposit, instruments, investment property, and other items received
         by Collateral Agent for deposit therein and held therein, as security
         for the Obligations. The rights granted by this Section 2.04(b)(vi)
         shall be in addition to the rights of the Collateral Agent under any
         statutory banker's Lien or the common law right of setoff.

         (c) Mandatory Payments/Reductions. (i) If for any reason the
Outstanding Amount of all Committed Loans, Swing Line Loans, and L/C Obligations
at any time exceeds the Aggregate Commitments then in effect, the Borrower shall
immediately prepay Committed Loans and/or Swing Line Loans and/or Cash
Collateralize the L/C Obligations in an aggregate amount equal to such excess
unless such excess occurs as a result of an event described in clause (ii) of
this Section in which case such excess shall be repaid within three Business
Days of such excess occurring; and (ii) if for any reason the Outstanding Amount
of all Committed Loans, Swing Line Loans, and L/C Obligations under the Working
Capital/Distribution Subfacility exceeds the Working Capital/Distribution
Subfacility Commitment, the Borrower shall prepay Committed Loans and/or Swing
Line Loans and/or Cash Collateralize the L/C Obligations in an aggregate amount
equal to such excess within three Business Days of such excess occurring.

         (d) Prepayments: Interest/Consequential Loss. All prepayments under
this Section 2.04 shall be made together with accrued interest to the date of
such prepayment on the principal amount prepaid and any amounts due under
Section 3.05.

         (e) The Borrower may, upon notice to the Swing Line Lender (with a copy
to the Administrative Agent), at any time or from time to time, voluntarily
prepay Swing Line Loans in whole or in part without premium or penalty; provided
that (i) such notice must be received by the Swing Line Lender and the
Administrative Agent not later than 1:00 p.m. New York, New York time on the
date of the prepayment, and (ii) any such prepayment shall be in a minimum
principal amount of $100,000. Each such notice shall specify the date and amount
of such prepayment. If such notice is given by the Borrower, the Borrower shall
make such prepayment and the payment amount specified in such notice shall be
due and payable on the date specified therein.

         SECTION 2.05 REDUCTION OR TERMINATION OF COMMITMENTS. The Borrower may,
upon notice to the Administrative Agent, terminate the Aggregate Commitments or
(prior to the Initial Funding Date) permanently reduce the Term Loan Commitment,
or permanently reduce the Revolver Commitment to an amount not less than the sum
of the Outstanding Amount of the then existing (a) Revolver Principal Debt, (b)
L/C Obligations, and (c) Swing Line Loans; provided that (i) any such notice
shall be received by the Administrative Agent not later than 11:00 a.m. New
York, New York time, five Business Days prior to the date of termination or
reduction, (ii) any such partial reduction shall be in an aggregate amount of
$1,000,000 or any whole multiple of $500,000 in excess thereof and (iii) any
Revolver Commitment reduction shall be allocated between the Acquisition
Subfacility and the Working Capital/Distribution Subfacility in amounts not less
than $500,000. The Administrative Agent shall promptly notify the Lenders of any
such notice of reduction or termination. Once reduced in accordance with this
Section, the Commitments may not be increased. Any reduction of the Revolver
Commitment shall be applied to the Commitment of each Lender according to its
Pro Rata Share, and any reduction of the Term Loan Commitment shall be applied
to the Commitment of each Lender according to its Pro Rata Share. All commitment
fees on the portion of the Commitment so terminated which have accrued to the
effective date of any termination of Commitments shall be paid on the effective
date of such termination.



                                       36
<PAGE>



         SECTION 2.06 REPAYMENT OF LOANS.

         (a) The Borrower shall repay to the Lenders on the Maturity Date the
aggregate principal amount of Committed Loans outstanding on such date.

         (b) The Borrower shall repay each Swing Line Loan on the earlier to
occur of (i) each Friday during the term hereof or, if any Friday is not a
Business Day, the next Business Day following such Friday and (ii) the Maturity
Date.

         SECTION 2.07 INTEREST.

         (a) Subject to the provisions of subsection (b) below, (i) each
Eurodollar Rate Loan shall bear interest on the outstanding principal amount
thereof for each Interest Period at a rate per annum equal to the Eurodollar
Rate for such Interest Period plus the Applicable Rate; (ii) each Base Rate
Committed Loan shall bear interest on the outstanding principal amount thereof
from the applicable borrowing date at a rate per annum equal to the Base Rate
plus the Applicable Rate; and (iii) each Swing Line Loan shall bear interest on
the outstanding principal amount thereof from the applicable borrowing date at a
rate per annum equal to the Base Rate plus the Applicable Rate.

         (b) The Borrower shall pay interest on all past due amounts at a
fluctuating interest rate per annum at all times equal to the Default Rate to
the fullest extent permitted by applicable Law. Accrued and unpaid interest on
such past due amounts (including interest on past due interest) shall be due and
payable upon demand.

         (c) Interest on each Loan shall be due and payable in arrears on each
Interest Payment Date applicable thereto and at such other times as may be
specified herein. Interest hereunder shall be due and payable in accordance with
the terms hereof before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law.

         (d) If the designated rate applicable to any Borrowing exceeds the
Maximum Rate, the rate of interest on such Borrowing shall be limited to the
Maximum Rate, but any subsequent reductions in such designated rate shall not
reduce the rate of interest thereon below the Maximum Rate until the total
amount of interest accrued thereon equals the amount of interest which would
have accrued thereon if such designated rate had at all times been in effect. In
the event that at maturity (stated or by acceleration), or at final payment of
the Outstanding Amount of any Committed Loans, Swing Line Loans or L/C
Obligations, the total amount of interest paid or accrued is less than the
amount of interest which would have accrued if such designated rates had at all
times been in effect, then, at such time and to the extent permitted by Law, the
Borrower shall pay an amount equal to the difference between (a) the lesser of
the amount of interest which would have accrued if such designated rates had at
all times been in effect and the amount of interest which would have accrued if
the Maximum Rate had at all times been in effect, and (b) the amount of interest
actually paid or accrued on such Outstanding Amount.

         SECTION 2.08 FEES.

         (a) Commitment Fee. The Borrower shall pay to the Administrative Agent
for the account of each Lender in accordance with its Pro Rata Share, a
commitment fee equal to the Applicable Rate times the actual daily amount by
which the Aggregate Committed Sum with respect to the Revolver Facility exceeds
the sum of (i) the Outstanding Amount of Committed Loans with respect to the
Revolver Facility and (ii) the Outstanding Amount of L/C Obligations. The
commitment fee shall accrue at all times from the Closing Date until the
Maturity Date and shall be due and payable quarterly in arrears on the last
Business Day of each March, June, September and December, commencing with the
first such date to



                                       37
<PAGE>



occur after the Closing Date, and on the Maturity Date. The commitment fee shall
be calculated quarterly in arrears, and if there is any change in the Applicable
Rate during any quarter, the actual daily amount shall be computed and
multiplied by the Applicable Rate separately for each period during such quarter
that such Applicable Rate was in effect. The commitment fee shall accrue at all
times, including at any time during which one or more of the conditions in
Article IV is not met.

         (b) Arranger's and Agency Fees. The Borrower shall pay certain fees to
the Arranger for the Arranger's own account, and shall pay an agency fee to the
Administrative Agent for the Administrative Agent's own account, in the amounts
and at the times specified in the letter agreement, dated September 5, 2002 (the
"Agent/Arranger Fee Letter"), between the Borrower, the Arranger and the
Administrative Agent. Such fees shall be fully earned when paid and shall be
nonrefundable for any reason whatsoever.

         (c) Lenders' Upfront Fee. On the Conditions Effective Date, the
Borrower shall pay to the Administrative Agent, for the account of the Lenders
in accordance with their respective Pro Rata Shares, an upfront fee in the
agreed amount in accordance with the Agent/Arranger Fee Letter. Such upfront
fees are for the credit facilities by the Lenders under this Agreement and are
fully earned on the date paid. The upfront fee paid to each Lender is solely for
its own account and is nonrefundable for any reason whatsoever.

         SECTION 2.09 COMPUTATION OF INTEREST AND FEES. Computation of interest
on Base Rate Loans shall be calculated on the basis of a year of 365 or 366
days, as the case may be, and the actual number of days elapsed. Computation of
all other types of interest and all fees shall be calculated on the basis of a
year of 360 days and the actual number of days elapsed, which results in a
higher yield to the payee thereof than a method based on a year of 365 or 366
days. Interest shall accrue on each Loan for the day on which the Loan is made,
and shall not accrue on a Loan, or any portion thereof, for the day on which the
Loan or such portion is paid, provided that any Loan that is repaid on the same
day on which it is made shall bear interest for one day.

         SECTION 2.10 EVIDENCE OF DEBT.

         (a) The Credit Extensions made by each Lender shall be evidenced by one
or more accounts or records maintained by such Lender and by the Administrative
Agent in the ordinary course of business. The accounts or records maintained by
the Administrative Agent and each Lender shall be conclusive absent manifest
error of the amount of the Credit Extensions made by the Lenders to the Borrower
and the interest and payments thereon. Any failure so to record or any error in
doing so shall not, however, limit or otherwise affect the obligation of the
Borrower hereunder to pay any amount owing with respect to the Obligations. In
the event of any conflict between the accounts and records maintained by any
Lender and the accounts and records of the Administrative Agent in respect of
such matters, the accounts and records of such Lender shall control. Upon the
request of any Lender made through the Administrative Agent, such Lender's Loans
may be evidenced by one or more Notes. Each Lender may attach schedules to its
Note(s) and endorse thereon the date, Type (if applicable), amount and maturity
of the applicable Loans and payments with respect thereto.

         (b) In addition to the accounts and records referred to in subsection
(a), each Lender and the Administrative Agent shall maintain in accordance with
its usual practice accounts or records evidencing the purchases and sales by
such Lender of participations in Letters of Credit and Swing Line Loans. In the
event of any conflict between the accounts and records maintained by the
Administrative Agent and the accounts and records of any Lender in respect of
such matters, the accounts and records of the Administrative Agent shall
control.



                                       38
<PAGE>



         SECTION 2.11 PAYMENTS GENERALLY.

         (a) All payments to be made by the Borrower shall be made without
condition or deduction for any counterclaim, defense, recoupment or setoff.
Except as otherwise expressly provided herein, all payments by the Borrower
hereunder shall be made to the Administrative Agent, for the account of the
respective Lenders to which such payment is owed, at the Administrative Agent's
Office in Dollars and in immediately available funds not later than 12:00 noon,
New York, New York time, on the date specified herein. The Administrative Agent
will promptly distribute to each Lender its Pro Rata Share (or other applicable
share as provided herein) of such payment in like funds as received by wire
transfer to such Lender's Lending Office. All payments received by the
Administrative Agent after 12:00 noon, New York, New York time, shall be deemed
received on the next succeeding Business Day and any applicable interest or fee
shall continue to accrue.

         (b) Subject to the definition of "Interest Period," if any payment to
be made by the Borrower shall come due on a day other than a Business Day,
payment shall be made on the next following Business Day, and such extension of
time shall be reflected in computing interest or fees, as the case may be.

         (c) If no Default or Event of Default exists and if no order of
application is otherwise specified in the Loan Documents, payments and
prepayments of the Obligations shall be applied first to fees, second to accrued
interest then due and payable on the Outstanding Amount of Loans and L/C
Obligations, and then to the remaining Obligations in the order and manner as
Borrower may direct.

         (d) If at any time insufficient funds are received by and available to
the Administrative Agent to pay fully the Obligations then due, or if a Default
or Event of Default exists, any payment or prepayment shall be applied in the
following order: (i) to the payment of enforcement expenses incurred by the
Administrative Agent, including Attorney Costs; (ii) to the ratable payment of
all other fees, expenses, and indemnities for which the Administrative Agent or
the Lenders are entitled to payment but have not yet been paid or reimbursed in
accordance with the Loan Documents (as used in this Section 2.11(d)(ii), a
"ratable payment" for any Lender or the Administrative Agent shall be, on any
date of determination, that proportion which the portion of the total fees,
expenses, and indemnities owed to such Lender or the Administrative Agent bears
to the total aggregate fees and indemnities owed to all Lenders and the
Administrative Agent on such date of determination); (iii) to the ratable
payment of accrued and unpaid interest on the Outstanding Amount of Loans and
the Outstanding Amount of Obligations under Lender Hedging Agreements (as used
in this Section 2.11(d)(iii), "ratable payment" means, for any Lender (or Lender
Affiliate, in the case of Lender Hedging Agreements), on any date of
determination, that proportion which the accrued and unpaid interest on the
Outstanding Amount of Loans and the Outstanding Amount of Obligations under
Lender Hedging Agreements owed to such Lender (or Lender Affiliate, in the case
of Lender Hedging Agreements) bears to the total accrued and unpaid interest on
the Outstanding Amount of Loans and the Outstanding Amount of Obligations under
Lender Hedging Agreements owed to all Lenders (and Affiliates, in the case of
Lender Hedging Agreements)); (iv) to the ratable payment of the Outstanding
Amount of Loans (as used in this Section 2.11(d)(iv), "ratable payment" means
for any Lender, on any date of determination, that proportion which the
Outstanding Amount of Loans owed to such Lender bears to the Outstanding Amount
of Loans owed to all Lenders); (v) to Cash Collateralize the Letters of Credit,
and (vi) to the payment of the remaining Obligations then due, if any, in the
order and manner the Required Lenders deem appropriate.

         (e) Unless the Borrower or any Lender has notified the Administrative
Agent prior to the date any payment is required to be made by it to the
Administrative Agent hereunder, that the Borrower or such Lender, as the case
may be, will not make such payment, the Administrative Agent may assume that the
Borrower or such Lender, as the case may be, has timely made such payment and
may (but shall



                                       39
<PAGE>



not be so required to), in reliance thereon, make available a corresponding
amount to the Person entitled thereto. If and to the extent that such payment
was not in fact made to the Administrative Agent in immediately available funds,
then:

                  (i) if the Borrower failed to make such payment, each Lender
         shall forthwith on demand repay to the Administrative Agent the portion
         of such assumed payment that was made available to such Lender in
         immediately available funds, together with interest thereon in respect
         of each day from and including the date such amount was made available
         by the Administrative Agent to such Lender to the date such amount is
         repaid to the Administrative Agent in immediately available funds, at
         the Federal Funds Rate from time to time in effect; and

                  (ii) if any Lender failed to make such payment, such Lender
         shall forthwith on demand pay to the Administrative Agent the amount
         thereof in immediately available funds, together with interest thereon
         for the period from the date such amount was made available by the
         Administrative Agent to the Borrower to the date such amount is
         recovered by the Administrative Agent (the "Compensation Period") at a
         rate per annum equal to the Federal Funds Rate from time to time in
         effect. If such Lender pays such amount to the Administrative Agent,
         then such amount shall constitute such Lender's Committed Loan,
         included in the applicable Borrowing. If such Lender does not pay such
         amount forthwith upon the Administrative Agent's demand therefor, the
         Administrative Agent may make a demand therefor upon the Borrower, and
         the Borrower shall pay such amount to the Administrative Agent,
         together with interest thereon for the Compensation Period at a rate
         per annum equal to the rate of interest applicable to the applicable
         Borrowing. Nothing herein shall be deemed to relieve any Lender from
         its obligation to fulfill its Commitment or to prejudice any rights
         which the Administrative Agent or the Borrower may have against any
         Lender as a result of any default by such Lender hereunder.

         A notice of the Administrative Agent to any Lender with respect to any
amount owing under this subsection (e) shall be conclusive, absent manifest
error.

         (f) If any Lender makes available to the Administrative Agent funds for
any Loan to be made by such Lender as provided in the foregoing provisions of
this Article II, and the conditions to the applicable Borrowing set forth in
Article IV are not satisfied or waived in accordance with the terms hereof, the
Administrative Agent shall return such funds (in like funds as received from
such Lender) to such Lender, without interest.

         (g) The obligations of the Lenders hereunder to make Loans are several
and not joint. The failure of any Lender to make any Loan on any date required
hereunder shall not relieve any other Lender of its corresponding obligation to
do so on such date, and no Lender shall be responsible for the failure of any
other Lender to so make its Loan or purchase its participation.

         (h) Nothing herein shall be deemed to obligate any Lender to obtain the
funds for any Loan in any particular place or manner or to constitute a
representation by any Lender that it has obtained or will obtain the funds for
any Loan in any particular place or manner.

         SECTION 2.12 SHARING OF PAYMENTS. If, other than as expressly provided
elsewhere herein, any Lender shall obtain on account of the Committed Loans made
by it, or the participations in the L/C Obligations, or in Swing Line Loans held
by it, any payment (whether voluntary, involuntary, through the exercise of any
right of set-off, or otherwise) in excess of its ratable share (or other share
contemplated hereunder) thereof, such Lender shall immediately (a) notify the
Administrative Agent of such fact, and (b) purchase from the other Lenders such
participations in the Committed Loans made by them, and/or such
subparticipations in the participations in L/C Obligations or Swing Line Loans
held by them, as the



                                       40
<PAGE>



case may be, as shall be necessary to cause such purchasing Lender to share the
excess payment in respect of such Committed Loan or such participations, as the
case may be, pro rata with each of them; provided, however, that if all or any
portion of such excess payment is thereafter recovered from the purchasing
Lender, such purchase shall to that extent be rescinded and each other Lender
shall repay to the purchasing Lender the purchase price paid therefor, together
with an amount equal to such paying Lender's ratable share (according to the
proportion of (i) the amount of such paying Lender's required repayment to (ii)
the total amount so recovered from the purchasing Lender) of any interest or
other amount paid or payable by the purchasing Lender in respect of the total
amount so recovered. The Borrower agrees that any Lender so purchasing a
participation from another Lender may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off, but subject
to Section 10.09) with respect to such participation as fully as if such Lender
were the direct creditor of the Borrower in the amount of such participation.
The Administrative Agent will keep records (which shall be conclusive and
binding in the absence of manifest error) of participations purchased under this
Section and will in each case notify the Lenders following any such purchases or
repayments. Each Lender that purchases a participation pursuant to this Section
shall from and after such purchase have the right to give all notices, requests,
demands, directions and other communications under this Agreement with respect
to the portion of the Obligations purchased to the same extent as though the
purchasing Lender were the original owner of the Obligations purchased.

         SECTION 2.13 PRIORITY OF HEDGING OBLIGATIONS. Any amounts received in
satisfaction of any Obligations arising under the Loan Documents, including,
without limitation, Obligations under this Agreement and any Lender Hedging
Agreement, shall rank pari passu in right of payment and shall be used to repay
such Obligations on a pro rata basis.

         SECTION 2.14 LETTERS OF CREDIT.

         (a) The Letter of Credit Commitment.

                  (i) Subject to the terms and conditions set forth herein, (A)
         the L/C Issuer agrees, in reliance upon the agreements of the other
         Lenders set forth in this Section 2.14, (1) from time to time on any
         Business Day during the period from the Conditions Effective Date until
         the Letter of Credit Expiration Date, to issue Letters of Credit for
         the account of the Borrower or its Subsidiaries, and to amend or renew
         Letters of Credit previously issued by it, in accordance with
         subsection (b) below, and (2) to honor drafts under the Letters of
         Credit; and (B) the Lenders severally agree to participate in Letters
         of Credit issued for the account of the Borrower and its Subsidiaries;
         provided that the L/C Issuer shall not be obligated to make any L/C
         Credit Extension with respect to any Letter of Credit, and no Lender
         shall be obligated to participate in, any Letter of Credit if as of the
         date of such L/C Credit Extension, (x) the Outstanding Amount of all
         L/C Obligations and all Loans under the Working Capital/Distribution
         Subfacility would exceed the Aggregate Commitments under the Working
         Capital/Distribution Subfacility, (y) the aggregate Outstanding Amount
         of the Loans of any Lender under the Working Capital/Distribution
         Subfacility, plus such Lender's Pro Rata Share of the Outstanding
         Amount of all L/C Obligations plus such Lender's Pro Rata Share of the
         Outstanding Amount of all Swing Line Loans would exceed such Lender's
         Working Capital/Distribution Subfacility Commitment, or (z) the
         Outstanding Amount of the L/C Obligations would exceed the Letter of
         Credit Sublimit. Within the foregoing limits, and subject to the terms
         and conditions hereof, the Borrower's ability to obtain Letters of
         Credit shall be fully revolving, and accordingly the Borrower may,
         during the foregoing period, obtain Letters of Credit to replace
         Letters of Credit that have expired or that have been drawn upon and
         reimbursed.

                  (ii) The L/C Issuer shall be under no obligation to issue any
         Letter of Credit if:



                                       41
<PAGE>



                           (A) any order, judgment or decree of any Governmental
                  Authority or arbitrator shall by its terms purport to enjoin
                  or restrain the L/C Issuer from issuing such Letter of Credit,
                  or any Law applicable to the L/C Issuer or any request or
                  directive (whether or not having the force of law) from any
                  Governmental Authority with jurisdiction over the L/C Issuer
                  shall prohibit, or request that the L/C Issuer refrain from,
                  the issuance of letters of credit generally or such Letter of
                  Credit in particular or shall impose upon the L/C Issuer with
                  respect to such Letter of Credit any restriction, reserve or
                  capital requirement (for which the L/C Issuer is not otherwise
                  compensated hereunder) not in effect on the Closing Date, or
                  shall impose upon the L/C Issuer any unreimbursed loss, cost
                  or expense which was not applicable on the Closing Date and
                  which the L/C Issuer in good faith deems material to it;

                           (B) subject to Section 2.14(b)(iii), the expiry date
                  of such requested Letter of Credit would occur more than
                  twelve months after the date of issuance or last renewal,
                  unless the Required Lenders have approved such expiry date;

                           (C) the expiry date of such requested Letter of
                  Credit would occur after the Letter of Credit Expiration Date,
                  unless all the Lenders have approved such expiry date;

                           (D) the issuance of such Letter of Credit would
                  violate one or more policies of the L/C Issuer generally
                  applicable to all borrowers; or

                           (E) such Letter of Credit is in a face amount less
                  than $100,000, or is to be used for a purpose other than as
                  described in Section 6.12 or is denominated in a currency
                  other than Dollars.

                  (iii) The L/C Issuer shall be under no obligation to amend any
         Letter of Credit if (A) the L/C Issuer would have no obligation at such
         time to issue such Letter of Credit in its amended form under the terms
         hereof, or (B) the beneficiary of such Letter of Credit does not accept
         the proposed amendment to such Letter of Credit.

         (b) Procedures for Issuance and Amendment of Letters of Credit;
Evergreen Letters of Credit.

                  (i) Each Letter of Credit shall be issued or amended, as the
         case may be, upon the request of the Borrower delivered to the L/C
         Issuer (with a copy to the Administrative Agent) in the form of a
         Letter of Credit Application, appropriately completed and signed by a
         Responsible Officer of the Borrower. Such L/C Application must be
         received by the L/C Issuer and the Administrative Agent not later than
         11:00 a.m., New York, New York time, at least two Business Days (or
         such later date and time as the L/C Issuer may agree in a particular
         instance in its sole discretion) prior to the proposed issuance date or
         date of amendment, as the case may be. In the case of a request for an
         initial issuance of a Letter of Credit, such Letter of Credit
         Application shall specify in form and detail satisfactory to the L/C
         Issuer: (A) the proposed issuance date of the requested Letter of
         Credit (which shall be a Business Day); (B) the amount thereof; (C) the
         expiry date thereof; (D) the name and address of the beneficiary
         thereof; (E) the documents to be presented by such beneficiary in case
         of any drawing thereunder; (F) the full text of any certificate to be
         presented by such beneficiary in case of any drawing thereunder; and
         (G) such other matters as the L/C Issuer may require. In the case of a
         request for an amendment of any outstanding Letter of Credit, such
         Letter of Credit Application shall specify in form and detail
         satisfactory to the L/C Issuer (A) the Letter of Credit to be amended;
         (B) the proposed date of



                                       42
<PAGE>



         amendment thereof (which shall be a Business Day); (C) the nature of
         the proposed amendment; and (D) such other matters as the L/C Issuer
         may require.

                  (ii) Promptly after receipt of any Letter of Credit
         Application, the L/C Issuer will confirm with the Administrative Agent
         (by telephone or in writing) that the Administrative Agent has received
         a copy of such Letter of Credit Application from the Borrower and, if
         not, the L/C Issuer will provide the Administrative Agent with a copy
         thereof. Upon receipt by the L/C Issuer of confirmation from the
         Administrative Agent that the requested issuance or amendment is
         permitted in accordance with the terms hereof, then, subject to the
         terms and conditions hereof, the L/C Issuer shall, on the requested
         date, issue a Letter of Credit for the account of the Borrower or enter
         into the applicable amendment, as the case may be, in each case in
         accordance with the L/C Issuer's usual and customary business
         practices. Immediately upon the issuance of each Letter of Credit, each
         Lender shall be deemed to, and hereby irrevocably and unconditionally
         agrees to, purchase from the L/C Issuer a participation in such Letter
         of Credit in an amount equal to the product of such Lender's Pro Rata
         Share times the amount of such Letter of Credit.

                  (iii) If the Borrower so requests in any applicable Letter of
         Credit Application, the L/C Issuer may, in it sole and absolute
         discretion, agree to issue a Letter of Credit that has automatic
         renewal provisions (each, an "Evergreen Letter of Credit"); provided
         that any such Evergreen Letter of Credit must permit the L/C Issuer to
         prevent any such renewal at least once in each twelve-month period
         (commencing with the date of issuance of such Letter of Credit) by
         giving prior notice to the beneficiary thereof not later than a day
         (the "Nonrenewal Notice Date") in each such twelve-month period to be
         agreed upon at the time such Letter of Credit is issued. Unless
         otherwise directed by the L/C Issuer, the Borrower shall not be
         required to make a specific request to the L/C Issuer for any such
         renewal. Once an Evergreen Letter of Credit has been issued, the
         Lenders shall be deemed to have authorized (but may not require) the
         L/C Issuer to permit the renewal of such Letter of Credit at any time
         to a date not later than the Letter of Credit Expiration Date;
         provided, however, that the L/C Issuer shall not permit any such
         renewal if it has received notice on or before the Business Day
         immediately preceding the Nonrenewal Notice Date (1) from the
         Administrative Agent that the Required Lenders have elected not to
         permit such renewal or (2) from any Lender stating that one or more of
         the applicable conditions specified in Section 4.03 is not then
         satisfied and directing the L/C Issuer not to permit such renewal.
         Notwithstanding anything to the contrary contained herein, the L/C
         Issuer shall have no obligation to permit the renewal of any Evergreen
         Letter of Credit at any time.

                  (iv) Promptly after its delivery of any Letter of Credit or
         any amendment to a Letter of Credit to an advising bank with respect
         thereto or to the beneficiary thereof, the L/C Issuer will also deliver
         to the Borrower and the Administrative Agent a true and complete copy
         of such Letter of Credit or amendment.

         (c) Drawings and Reimbursements; Funding of Participations.

                  (i) Upon any drawing under any Letter of Credit, the L/C
         Issuer shall notify the Borrower and the Administrative Agent thereof.
         Not later than 11:00 a.m., New York time, on the date of any payment by
         the L/C Issuer under a Letter of Credit (each such date, an "Honor
         Date"), the Borrower shall reimburse the L/C Issuer through the
         Administrative Agent in an amount equal to the amount of such drawing.
         If the Borrower fails to so reimburse the L/C Issuer by such time, the
         Administrative Agent shall promptly notify each Lender of the Honor
         Date, the amount of the unreimbursed drawing (the "Unreimbursed
         Amount"), and such Lender's Pro Rata Share thereof. In such event, the
         Borrower shall be deemed to have requested a Committed



                                       43
<PAGE>



         Borrowing of Base Rate Loans to be disbursed on the Honor Date in an
         amount equal to the Unreimbursed Amount, without regard to the minimum
         and multiples specified in Section 2.03 for the principal amount of
         Base Rate Loans, but subject to the amount of the unutilized portion of
         the Aggregate Commitments and the conditions set forth in Section 4.03
         (other than the delivery of a Committed Loan Notice). Any notice given
         by the L/C Issuer or the Administrative Agent pursuant to this Section
         2.14(c)(i) may be given by telephone if immediately confirmed in
         writing; provided that the lack of such an immediate confirmation shall
         not affect the conclusiveness or binding effect of such notice.

                  (ii) Each Lender (including the Lender acting as L/C Issuer)
         shall upon any notice pursuant to Section 2.14(c)(i) make funds
         available to the Administrative Agent for the account of the L/C Issuer
         at the Administrative Agent's Office in an amount equal to its Pro Rata
         Share of the Unreimbursed Amount not later than 1:00 p.m., New York
         time, on the Business Day specified in such notice by the
         Administrative Agent, whereupon, subject to the provisions of Section
         2.14(c)(iii), each Lender that so makes funds available shall be deemed
         to have made a Base Rate Committed Loan to the Borrower in such amount.
         The Administrative Agent shall remit the funds so received to the L/C
         Issuer.

                  (iii) With respect to any Unreimbursed Amount that is not
         fully refinanced by a Committed Borrowing of Base Rate Loans because
         the conditions set forth in Section 4.03 cannot be satisfied or for any
         other reason, the Borrower shall be deemed to have incurred from the
         L/C Issuer an L/C Borrowing in the amount of the Unreimbursed Amount
         that is not so refinanced, which L/C Borrowing shall be due and payable
         on demand (together with interest) and shall bear interest at the
         Default Rate. In such event, each Lender's payment to the
         Administrative Agent for the account of the L/C Issuer pursuant to
         Section 2.14(c)(ii) shall be deemed payment in respect of its
         participation in such L/C Borrowing and shall constitute an L/C Advance
         from such Lender in satisfaction of its participation obligation under
         this Section 2.14.

                  (iv) Until each Lender funds its Committed Loan or L/C Advance
         pursuant to this Section 2.14(c) to reimburse the L/C Issuer for any
         amount drawn under any Letter of Credit, interest in respect of such
         Lender's Pro Rata Share of such amount shall be solely for the account
         of the L/C Issuer.

                  (v) Each Lender's obligation to make Committed Loans or L/C
         Advances to reimburse the L/C Issuer for amounts drawn under Letters of
         Credit, as contemplated by this Section 2.14(c), shall be absolute and
         unconditional and shall not be affected by any circumstance, including
         (A) any set-off, counterclaim, recoupment, defense or other right which
         such Lender may have against the L/C Issuer, the Borrower or any other
         Person for any reason whatsoever; (B) the occurrence or continuance of
         a Default or Event of Default, or (C) any other occurrence, event or
         condition, whether or not similar to any of the foregoing. Any such
         reimbursement shall not relieve or otherwise impair the obligation of
         the Borrower to reimburse the L/C Issuer for the amount of any payment
         made by the L/C Issuer under any Letter of Credit, together with
         interest as provided herein.

                  (vi) If any Lender fails to make available to the
         Administrative Agent for the account of the L/C Issuer any amount
         required to be paid by such Lender pursuant to the foregoing provisions
         of this Section 2.14(c) by the time specified in Section 2.14(c)(ii),
         the L/C Issuer shall be entitled to recover from such Lender (acting
         through the Administrative Agent), on demand, such amount with interest
         thereon for the period from the date such payment is required to the
         date on which such payment is immediately available to the L/C Issuer
         at a rate per annum equal to the Federal Funds Rate from time to time
         in effect. A certificate of the L/C Issuer submitted to



                                       44
<PAGE>



         any Lender (through the Administrative Agent) with respect to any
         amounts owing under this clause (vi) shall be conclusive absent
         manifest error.

         (d) Repayment of Participations.

                  (i) At any time after the L/C Issuer has made a payment under
         any Letter of Credit and has received from any Lender such Lender's L/C
         Advance in respect of such payment in accordance with Section 2.14(c),
         if the Administrative Agent receives for the account of the L/C Issuer
         any payment related to such Letter of Credit (whether directly from the
         Borrower or otherwise, including proceeds of cash Collateral applied
         thereto by the Administrative Agent), or any payment of interest
         thereon, the Administrative Agent will distribute to such Lender its
         Pro Rata Share thereof in the same funds as those received by the
         Administrative Agent.

                  (ii) If any payment received by the Administrative Agent for
         the account of the L/C Issuer pursuant to Section 2.14(c)(i) is
         required to be returned, each Lender shall pay to the Administrative
         Agent for the account of the L/C Issuer its Pro Rata Share thereof on
         demand of the Administrative Agent, plus interest thereon from the date
         of such demand to the date such amount is returned by such Lender, at a
         rate per annum equal to the Federal Funds Rate from time to time in
         effect.

         (e) Obligations Absolute. The obligation of the Borrower to reimburse
the L/C Issuer for each drawing under each Letter of Credit, and to repay each
L/C Borrowing and each drawing under a Letter of Credit that is refinanced by a
Borrowing of Loans, shall be absolute, unconditional and irrevocable, and shall
be paid strictly in accordance with the terms of this Agreement under all
circumstances, including the following:

                  (i) any lack of validity or enforceability of such Letter of
         Credit, this Agreement, or any other agreement or instrument relating
         thereto;

                  (ii) the existence of any claim, counterclaim, set-off,
         defense or other right that the Borrower may have at any time against
         any beneficiary or any transferee of such Letter of Credit (or any
         Person for whom any such beneficiary or any such transferee may be
         acting), the L/C Issuer or any other Person, whether in connection with
         this Agreement, the transactions contemplated hereby or by such Letter
         of Credit or any agreement or instrument relating thereto, or any
         unrelated transaction;

                  (iii) any draft, demand, certificate or other document
         presented under such Letter of Credit proving to be forged, fraudulent,
         invalid or insufficient in any respect or any statement therein being
         untrue or inaccurate in any respect; or any loss or delay in the
         transmission or otherwise of any document required in order to make a
         drawing under such Letter of Credit;

                  (iv) any payment by the L/C Issuer under such Letter of Credit
         against presentation of a draft or certificate that does not strictly
         comply with the terms of such Letter of Credit; or any payment made by
         the L/C Issuer under such Letter of Credit to any Person purporting to
         be a trustee in bankruptcy, debtor-in-possession, assignee for the
         benefit of creditors, liquidator, receiver or other representative of
         or successor to any beneficiary or any transferee of such Letter of
         Credit, including any arising in connection with any proceeding under
         any Debtor Relief Law; or



                                       45
<PAGE>



                  (v) any other circumstance or happening whatsoever, whether or
         not similar to any of the foregoing, that might otherwise constitute a
         defense available to, or a discharge of, the Borrower.

         The Borrower shall promptly examine a copy of each Letter of Credit and
each amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with the Borrower's instructions or other irregularity, the
Borrower will immediately notify the L/C Issuer. The Borrower shall be
conclusively deemed to have waived any such claim against the L/C Issuer and its
correspondents unless such notice is given as aforesaid.

         (f) Role of L/C Issuer. Each Lender and the Borrower agree that, in
paying any drawing under a Letter of Credit, the L/C Issuer shall not have any
responsibility to obtain any document (other than any sight draft, certificates
and documents expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document. No Agent-Related Person
nor any of the respective correspondents, participants or assignees of the L/C
Issuer shall be liable to any Lender for (i) any action taken or omitted in
connection herewith at the request or with the approval of the Lenders or the
Required Lenders, as applicable; (ii) any action taken or omitted in the absence
of gross negligence or willful misconduct; or (iii) the due execution,
effectiveness, validity or enforceability of any document or instrument related
to any Letter of Credit or Letter of Credit Application. The Borrower hereby
assumes all risks of the acts or omissions of any beneficiary or transferee with
respect to its use of any Letter of Credit; provided, however, that this
assumption is not intended to, and shall not, preclude the Borrower's pursuing
such rights and remedies as it may have against the beneficiary or transferee at
law or under any other agreement. No Agent-Related Person, nor any of the
respective correspondents, participants or assignees of the L/C Issuer, shall be
liable or responsible for any of the matters described in clauses (i) through
(v) of Section 2.14(e); provided, however, that anything in such clauses to the
contrary notwithstanding, the Borrower may have a claim against the L/C Issuer,
and the L/C Issuer may be liable to the Borrower, to the extent, but only to the
extent, of any direct, as opposed to consequential or exemplary, damages
suffered by the Borrower which the Borrower proves were caused by the L/C
Issuer's willful misconduct or gross negligence or the L/C Issuer's willful
failure to pay under any Letter of Credit after the presentation to it by the
beneficiary of a sight draft and certificate(s) strictly complying with the
terms and conditions of a Letter of Credit. In furtherance and not in limitation
of the foregoing, the L/C Issuer may accept documents that appear on their face
to be in order, without responsibility for further investigation, regardless of
any notice or information to the contrary, and the L/C Issuer shall not be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason.

         (g) Cash Collateral. Upon the request of the Administrative Agent, (i)
if the L/C Issuer has honored any full or partial drawing request under any
Letter of Credit and such drawing has resulted in an L/C Borrowing, or (ii) if,
as of the Letter of Credit Expiration Date, any Letter of Credit may for any
reason remain outstanding and partially or wholly undrawn, the Borrower shall
immediately Cash Collateralize the then Outstanding Amount of all L/C
Obligations (in an amount equal to such Outstanding Amount). The Borrower hereby
grants the Collateral Agent, for the benefit of the L/C Issuer and the Lenders,
a Lien on all such cash and deposit accounts at the Administrative Agent and the
Collateral Agent.

         (h) Applicability of ISP98. Unless otherwise expressly agreed by the
L/C Issuer and the Borrower when a Letter of Credit is issued (including any
such agreement applicable to an Existing Letter of Credit), the rules of the
"International Standby Practices 1998" published by the Institute of



                                       46
<PAGE>



International Banking Law & Practice (or such later version thereof as may be in
effect at the time of issuance) shall apply to each Letter of Credit.

         (i) Letter of Credit Fees. The Borrower shall pay to the Administrative
Agent for the account of each Lender in accordance with its Pro Rata Share a
Letter of Credit fee for each Letter of Credit issued equal to the product of
the Applicable Rate times the actual daily undrawn amount under each Letter of
Credit. Such fee for each Letter of Credit shall be due and payable on the last
Business Day of each March, June, September and December, commencing with the
first such date to occur after the issuance of such Letter of Credit, and on the
Letter of Credit Expiration Date. If there is any change in the Applicable Rate
during any quarter, the actual daily undrawn amount of each Letter of Credit
shall be computed and multiplied by the Applicable Rate separately for each
period during such quarter that such Applicable Rate was in effect.

         (j) Fronting Fee and Documentary and Processing Charges Payable to L/C
Issuer. The Borrower shall pay directly to the L/C Issuer for its own account an
annual fronting fee in an amount with respect to each Letter of Credit issued
equal to the greater of (i) $500 or (ii) 1/4 of 1% per annum calculated on the
daily undrawn face amount thereof. In addition, the Borrower shall pay directly
to the L/C Issuer for its own account the customary issuance, presentation,
amendment and other processing fees, and other standard costs and charges, of
the L/C Issuer relating to letters of credit as from time to time in effect.
Such fees and charges are due and payable on demand and are nonrefundable.

         (k) Conflict with Letter of Credit Application. In the event of any
conflict between the terms hereof and the terms of any Letter of Credit
Application, the terms hereof shall control.

         SECTION 2.15 SWING LINE LOANS.

         (a) The Swing Line. Subject to the terms and conditions set forth
herein, the Swing Line Lender agrees to make loans (each such loan, a "Swing
Line Loan") to the Borrower from time to time on any Business Day during the
Availability Period in an aggregate amount not to exceed at any time outstanding
the amount of the Swing Line Sublimit, notwithstanding the fact that such Swing
Line Loans, when aggregated with the Pro Rata Share of the Outstanding Amount of
Committed Loans and L/C Obligations of the Lender acting as Swing Line Lender,
may exceed the amount of such Lender's Commitment; provided, however, that after
giving effect to any Swing Line Loan, (i) the Amount Outstanding under the
Working Capital/Distribution Subfacility shall not exceed the Aggregate
Commitments under the Working Capital/Distribution Subfacility, and (ii) the
aggregate Outstanding Amount of the Committed Loans under the Working
Capital/Distribution Subfacility of any Lender, plus such Lender's Pro Rata
Share of the Outstanding Amount of all L/C Obligations, plus such Lender's Pro
Rata Share of the Outstanding Amount of all Swing Line Loans shall not exceed
such Lender's Working Capital/Distribution Subfacility Commitment, and provided,
further, that the Borrower shall not use the proceeds of any Swing Line Loan to
refinance any outstanding Swing Line Loan. Within the foregoing limits, and
subject to the other terms and conditions hereof, the Borrower may borrow under
this Section 2.15, prepay under Section 2.04, and reborrow under this Section
2.15. Each Swing Line Loan shall be a Base Rate Loan and shall be outstanding
for no longer than five (5) Business Days. Immediately upon the making of a
Swing Line Loan, each Lender shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from the Swing Line Lender a risk
participation in such Swing Line Loan in an amount equal to the product of such
Lender's Pro Rata Share times the amount of such Swing Line Loan.

         (b) Borrowing Procedures. Each Swing Line Borrowing shall be made upon
the Borrower's irrevocable notice to the Administrative Agent, which may be
given by telephone. Each such notice must be received by the Administrative
Agent not later than 2:00 p.m. New York, New York time on the



                                       47
<PAGE>



requested borrowing date, and shall specify (i) the amount to be borrowed, which
shall be a minimum of $100,000 or a whole multiple of $100,000 in excess
thereof, and (ii) the requested borrowing date, which shall be a Business Day.
Each such telephonic notice must be confirmed promptly by delivery to the
Administrative Agent of a written Swing Line Loan Notice, appropriately
completed and signed by a Responsible Officer of the Borrower. Promptly after
receipt by the Administrative Agent of any telephonic Swing Line Loan Notice,
the Administrative Agent will notify the Swing Line Lender (by telephone or in
writing) of such Swing Line Loan Notice and the contents thereof. Unless the
Swing Line Lender has received notice (by telephone or in writing) from the
Administrative Agent (including at the request of any Lender) prior to 2:30 p.m.
New York, New York time on the date of the proposed Swing Line Borrowing (A)
directing the Swing Line Lender not to make such Swing Line Loan as a result of
the limitations set forth in the proviso to the first sentence of Section
2.15(a), or (B) that one or more of the applicable conditions specified in
Article IV is not then satisfied, then, subject to the terms and conditions
hereof, the Swing Line Lender will, not later than 3:00 p.m. New York, New York
time on the borrowing date specified in such Swing Line Loan Notice, make the
amount of its Swing Line Loan available to the Borrower at its office by
crediting the account of the Borrower on the books of the Swing Line Lender in
immediately available funds.

         (c) Refinancing of Swing Line Loans.

                  (i) The Swing Line Lender at any time in its sole and absolute
         discretion may request, on behalf of the Borrower (which hereby
         irrevocably authorizes the Swing Line Lender to so request on its
         behalf), that each Lender make a Base Rate Committed Loan in an amount
         equal to such Lender's Pro Rata Share of the amount of Swing Line Loans
         then outstanding. Such request shall be made in writing (which written
         request shall be deemed to be a Committed Loan Notice for purposes
         hereof) and in accordance with the requirements of Section 2.03,
         without regard to the minimum and multiples specified therein for the
         principal amount of Base Rate Loans, but subject to the unutilized
         portion of the Aggregate Commitments and the conditions set forth in
         Section 4.03. The Swing Line Lender shall furnish the Borrower with a
         copy of the applicable Committed Loan Notice promptly after delivering
         such notice to the Administrative Agent. Each Lender shall make an
         amount equal to its Pro Rata Share of the amount specified in such
         Committed Loan Notice available to the Administrative Agent in
         immediately available funds for the account of the Swing Line Lender at
         the Administrative Agent's Office not later than 1:00 p.m. on the day
         specified in such Committed Loan Notice, whereupon, subject to Section
         2.15(c)(ii), each Lender that so makes funds available shall be deemed
         to have made a Base Rate Committed Loan to the Borrower in such amount.
         The Administrative Agent shall remit the funds so received to the Swing
         Line Lender.

                  (ii) If for any reason any Swing Line Loan cannot be
         refinanced by such a Committed Borrowing in accordance with Section
         2.15(c)(i), the request for Base Rate Committed Loans submitted by the
         Swing Line Lender as set forth herein shall be deemed to be a request
         by the Swing Line Lender that each of the Lenders fund its risk
         participation in the relevant Swing Line Loan and each Lender's payment
         to the Administrative Agent for the account of the Swing Line Lender
         pursuant to Section 2.15(c)(i) shall be deemed payment in respect of
         such participation.

                  (iii) If any Lender fails to make available to the
         Administrative Agent for the account of the Swing Line Lender any
         amount required to be paid by such Lender pursuant to the foregoing
         provisions of this Section 2.15(c) by the time specified in Section
         2.15(c)(i), the Swing Line Lender shall be entitled to recover from
         such Lender (acting through the Administrative Agent), on demand, such
         amount with interest thereon for the period from the date such payment
         is required to the date on which such payment is immediately available
         to the Swing Line Lender



                                       48
<PAGE>



         at a rate per annum equal to the Federal Funds Rate from time to time
         in effect. A certificate of the Swing Line Lender submitted to any
         Lender (through the Administrative Agent) with respect to any amounts
         owing under this clause (iii) shall be conclusive absent manifest
         error.

                  (iv) Each Lender's obligation to make Committed Loans or to
         purchase and fund risk participations in Swing Line Loans pursuant to
         this Section 2.15(c) shall be absolute and unconditional and shall not
         be affected by any circumstance, including (A) any set-off,
         counterclaim, recoupment, defense or other right which such Lender may
         have against the Swing Line Lender, the Borrower or any other Person
         for any reason whatsoever, (B) the occurrence or continuance of a
         Default, or (C) any other occurrence, event or condition, whether or
         not similar to any of the foregoing; provided, however, that each
         Lender's obligation to make Committed Loans pursuant to this Section
         2.15(c) is subject to the conditions set forth in Section 4.03. No such
         funding of risk participations shall relieve or otherwise impair the
         obligation of the Borrower to repay Swing Line Loans, together with
         interest as provided herein.

         (d) Repayment of Participations.

                  (i) At any time after any Lender has purchased and funded a
         risk participation in a Swing Line Loan, if the Swing Line Lender
         receives any payment on account of such Swing Line Loan, the Swing Line
         Lender will distribute to such Lender its Pro Rata Share of such
         payment (appropriately adjusted, in the case of interest payments, to
         reflect the period of time during which such Lender's risk
         participation was funded) in the same funds as those received by the
         Swing Line Lender.

                  (ii) If any payment received by the Swing Line Lender in
         respect of principal or interest on any Swing Line Loan is required to
         be returned by the Swing Line Lender under any of the circumstances
         described in Section 10.06 (including pursuant to any settlement
         entered into by the Swing Line Lender in its discretion), each Lender
         shall pay to the Swing Line Lender its Pro Rata Share thereof on demand
         of the Administrative Agent, plus interest thereon from the date of
         such demand to the date such amount is returned, at a rate per annum
         equal to the Federal Funds Rate. The Administrative Agent will make
         such demand upon the request of the Swing Line Lender.

         (e) Interest for Account of Swing Line Lender. The Swing Line Lender
shall be responsible for invoicing the Borrower for interest on the Swing Line
Loans. Until each Lender funds its Base Rate Committed Loan or risk
participation pursuant to this Section 2.15 to refinance such Lender's Pro Rata
Share of any Swing Line Loan, interest in respect of such Pro Rata Share shall
be solely for the account of the Swing Line Lender.

         (f) Payments Directly to Swing Line Lender. The Borrower shall make all
payments of principal and interest in respect of the Swing Line Loans directly
to the Swing Line Lender.

                                  ARTICLE III.
                     TAXES, YIELD PROTECTION AND ILLEGALITY

         SECTION 3.01 TAXES.

         (a) Any and all payments by the Borrower to or for the account of the
Administrative Agent or any Lender under any Loan Document shall be made free
and clear of and without deduction for any and all present or future taxes,
duties, levies, imposts, deductions, assessments, fees, withholdings or similar
charges, and all liabilities with respect thereto, excluding, in the case of the
Administrative Agent



                                       49
<PAGE>



and each Lender, taxes imposed on or measured by its net income, and franchise
taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any
political subdivision thereof) under the Laws of which the Administrative Agent
or such Lender, as the case may be, is organized or maintains its Lending Office
(all such non-excluded taxes, duties, levies, imposts, deductions, assessments,
fees, withholdings or similar charges, and liabilities being hereinafter
referred to as "Taxes"). If the Borrower shall be required by any Laws to deduct
any Taxes from or in respect of any sum payable under any Loan Document to the
Administrative Agent or any Lender, (i) the sum payable shall be increased as
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section), each of the
Administrative Agent and such Lender receives an amount equal to the sum it
would have received had no such deductions been made, (ii) the Borrower shall
make such deductions, (iii) the Borrower shall pay the full amount deducted to
the relevant taxation authority or other authority in accordance with applicable
Laws, and (iv) within 30 days after the date of such payment, the Borrower shall
furnish to the Administrative Agent (which shall forward the same to such
Lender) the original or a certified copy of a receipt evidencing payment
thereof.

         (b) In addition, the Borrower agrees to pay any and all present or
future stamp, court or documentary taxes and any other excise or property taxes
or charges or similar levies which arise from any payment made under any Loan
Document or from the execution, delivery, performance, enforcement or
registration of, or otherwise with respect to, any Loan Document (hereinafter
referred to as "Other Taxes").

         (c) If the Borrower shall be required to deduct or pay any Taxes or
Other Taxes from or in respect of any sum payable under any Loan Document to the
Administrative Agent or any Lender, the Borrower shall also pay to the
Administrative Agent (for the account of such Lender) or to such Lender, at the
time interest is paid, such additional amount that such Lender specifies as
necessary to preserve the after-tax yield (after factoring in all taxes,
including taxes imposed on or measured by net income) such Lender would have
received if such Taxes or Other Taxes had not been imposed.

         (d) The Borrower agrees to indemnify the Administrative Agent and each
Lender for (i) the full amount of Taxes and Other Taxes (including any Taxes or
Other Taxes imposed or asserted by any jurisdiction on amounts payable under
this Section) paid by the Administrative Agent and such Lender, (ii) amounts
payable under Section 3.01(c) and (iii) any liability (including penalties,
interest and expenses) arising therefrom or with respect thereto. Payment under
this subsection (d) shall be made within 30 days after the date the Lender or
the Administrative Agent makes a demand therefor.

         SECTION 3.02 ILLEGALITY. If any Lender determines that any Law has made
it unlawful, or that any Governmental Authority has asserted that it is
unlawful, for any Lender or its applicable Lending Office to make, maintain or
fund Eurodollar Rate Loans, or materially restricts the authority of such Lender
to purchase or sell, or to take deposits of, Dollars in the applicable offshore
Dollar market, or to determine or charge interest rates based upon the
Eurodollar Rate, then, on notice thereof by such Lender to the Borrower through
the Administrative Agent, any obligation of such Lender to make or continue
Eurodollar Rate Loans or to convert Base Rate Committed Loans to Eurodollar Rate
Loans shall be suspended until such Lender notifies the Administrative Agent and
the Borrower that the circumstances giving rise to such determination no longer
exist. Upon receipt of such notice, the Borrower shall, upon demand from such
Lender (with a copy to the Administrative Agent), prepay or, if applicable,
convert all Eurodollar Rate Loans of such Lender to Base Rate Loans, either on
the last day of the Interest Period thereof, if such Lender may lawfully
continue to maintain such Eurodollar Rate Loans to such day, or immediately, if
such Lender may not lawfully continue to maintain such Eurodollar Rate Loans.
Upon any such prepayment or conversion, the Borrower shall also pay interest on
the amount so prepaid or converted. Each Lender agrees to designate a different
Lending Office if such designation will avoid the



                                       50
<PAGE>



need for such notice and will not, in the reasonable judgment of such Lender,
otherwise be materially disadvantageous to such Lender.

         SECTION 3.03 INABILITY TO DETERMINE RATES. If the Administrative Agent
determines in connection with any request for a Eurodollar Rate Loan or a
conversion to or continuation thereof that (a) Dollar deposits are not being
offered to banks in the applicable offshore Dollar market for the applicable
amount and Interest Period of such Eurodollar Rate Loan, or adequate and
reasonable means do not exist for determining the Eurodollar Rate for such
Eurodollar Rate Loan, or (b) if the Required Lenders determine and notify the
Administrative Agent that the Eurodollar Rate for such Eurodollar Rate Loan does
not adequately and fairly reflect the cost to the Lenders of funding such
Eurodollar Rate Loan, then the Administrative Agent will promptly notify the
Borrower and all Lenders. Thereafter, the obligation of the Lenders to make or
maintain Eurodollar Rate Loans shall be suspended until the Administrative Agent
revokes such notice. Upon receipt of such notice, the Borrower may revoke any
pending request for a Borrowing, conversion or continuation of Eurodollar Rate
Loans or, failing that, will be deemed to have converted such request into a
request for a Committed Borrowing of Base Rate Loans in the amount specified
therein.

         SECTION 3.04 INCREASED COST AND REDUCED RETURN; CAPITAL ADEQUACY;
RESERVES ON EURODOLLAR RATE LOANS.

         (a) If any Lender determines that as a result of a Change in Law, or
such Lender's compliance therewith, there shall be any increase in the cost to
such Lender of agreeing to make or making, funding or maintaining Eurodollar
Rate Loans, or a reduction in the amount received or receivable by such Lender
in connection with any of the foregoing (excluding for purposes of this
subsection (a) any such increased costs or reduction in amount resulting from
(i) Taxes or Other Taxes (as to which Section 3.01 shall govern), (ii) changes
in the basis of taxation of overall net income or overall gross income by the
United States or any foreign jurisdiction or any political subdivision of either
thereof under the Laws of which such Lender is organized or has its Lending
Office, and (iii) reserve requirements contemplated by Section 3.04(c) utilized,
as to Eurodollar Rate Loans, in the determination of the Eurodollar Rate), then
from time to time upon demand of such Lender (with a copy of such demand to the
Administrative Agent), the Borrower shall pay to such Lender such additional
amounts as will compensate such Lender for such increased cost or reduction.

         (b) If any Lender determines a Change In Law regarding capital adequacy
has the effect of reducing the rate of return on the capital of such Lender or
any corporation controlling such Lender as a consequence of such Lender's
obligations hereunder (taking into consideration its policies with respect to
capital adequacy and such Lender's desired return on capital), then from time to
time upon demand of such Lender (with a copy of such demand to the
Administrative Agent), the Borrower shall pay to such Lender such additional
amounts as will compensate such Lender for such reduction.

         (c) The Borrower shall pay to each Lender, as long as such Lender shall
be required under regulations of the Board to maintain reserves with respect to
liabilities or assets consisting of or including Eurocurrency funds or deposits
(currently known as "Eurocurrency liabilities"), additional costs on the unpaid
principal amount of each Eurodollar Rate Loan equal to the actual costs of such
reserves allocated to such Loan by such Lender (as determined by such Lender in
good faith, which determination shall be conclusive), which shall be due and
payable on each date on which interest is payable on such Loan, provided the
Borrower shall have received at least 15 days' prior notice (with a copy to the
Administrative Agent) of such additional interest from such Lender. If a Lender
fails to give notice 15 days prior to the relevant Interest Payment Date, such
additional interest shall be due and payable 15 days from receipt of such
notice.



                                       51
<PAGE>



         SECTION 3.05 FUNDING LOSSES. Upon demand of any Lender (with a copy to
the Administrative Agent) from time to time, the Borrower shall promptly
compensate such Lender for and hold such Lender harmless from any loss, cost or
expense incurred by it as a result of:

         (a) any continuation, conversion, payment or prepayment of any Loan
other than a Base Rate Loan on a day other than the last day of the Interest
Period for such Loan (whether voluntary, mandatory, automatic, by reason of
acceleration, or otherwise); or

         (b) any failure by the Borrower (for a reason other than the failure of
such Lender to make a Loan) to prepay, borrow, continue or convert any Loan
other than a Base Rate Loan on the date or in the amount notified by the
Borrower; including any loss of anticipated profits and any loss or expense
arising from the liquidation or reemployment of funds obtained by it to maintain
such Loan or from fees payable to terminate the deposits from which such funds
were obtained. The Borrower shall also pay any customary administrative fees
charged by such Lender in connection with the foregoing.

         For purposes of calculating amounts payable by the Borrower to the
Lenders under this Section 3.05, each Lender shall be deemed to have funded each
Eurodollar Rate Loan made by it at the Eurodollar Rate for such Loan by a
matching deposit or other borrowing in the applicable offshore Dollar interbank
market for a comparable amount and for a comparable period, whether or not such
Eurodollar Rate Loan was in fact so funded.

         SECTION 3.06 MATTERS APPLICABLE TO ALL REQUESTS FOR COMPENSATION.

         (a) A certificate of the Administrative Agent or any Lender claiming
compensation under this Article III and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error. In determining such amount, the Administrative Agent or such
Lender may use any reasonable averaging and attribution methods.

         (b) If any Lender requests compensation under Section 3.04, or if the
Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 3.01,
then such Lender shall use reasonable efforts to designate a different lending
office for funding or booking its Loans hereunder or to assign its rights and
obligations hereunder to another of its offices, branches or affiliates, if, in
the judgment of such Lender, such designation or assignment (i) would eliminate
or reduce amounts payable pursuant to Section 3.01 or 3.04, as the case may be,
in the future and (ii) would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. The Borrower
hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.

         SECTION 3.07 SURVIVAL. All of the Borrower's obligations under this
Article III shall survive termination of the Commitments and payment in full of
all the other Obligations.

                                   ARTICLE IV.
                       CONDITIONS PRECEDENT TO BORROWINGS

         SECTION 4.01 CONDITIONS TO INITIAL CREDIT EXTENSION. The obligation of
each Lender to fund its portion of the initial Credit Extension hereunder is
subject to satisfaction of the following conditions precedent:

         (a) The Administrative Agent's receipt of the following, each of which
shall be originals or facsimiles (followed promptly by originals) and unless
otherwise specified, each properly executed by an



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<PAGE>



authorized officer of the signing Loan Party, each dated the Conditions
Effective Date (or, in the case of certificates of governmental officials, a
recent date before the Conditions Effective Date) or the Closing Date, as
appropriate, and each in form and substance satisfactory to the Administrative
Agent and its legal counsel:

                  (i) executed counterparts of this Agreement, the Master
         Consent to Assignment, the Guaranties, the U.S. Vessel Mortgages, the
         Mortgages executed by the Borrower substantially in the forms of
         Exhibits L and M and all other Collateral Documents required by the
         Administrative Agent, each dated as of the Closing Date or as of the
         Conditions Effective Date;

                  (ii) Notes executed by the Borrower in favor of each Lender
         requesting such Notes, each in a principal amount equal to such
         Lender's Committed Sum, each dated as of the Closing Date or as of the
         Conditions Effective Date;

                  (iii) such certificates of resolutions or other action,
         incumbency certificates and/or other certificates of officers of each
         Loan Party as the Administrative Agent may require to establish the
         identities of and verify the authority and capacity of each officer
         thereof authorized to act in connection with this Agreement and the
         other Loan Documents to which such Loan Party is a party;

                  (iv) such evidence as the Administrative Agent may reasonably
         require to verify that each Loan Party is duly organized or formed,
         validly existing, and in good standing in the jurisdiction of its
         organization;

                  (v) a certificate signed by a Responsible Officer of the
         Borrower certifying that (A) the MLP Offering Closing has occurred and
         that the gross proceeds of the sale of limited partner units (other
         than proceeds paid by the MLP General Partner and Martin Parties) are
         not less than $55,000,000, (B) that the representations and warranties
         contained in Article V are true and correct in all respects on and as
         of such date, (C) no Default or Event of Default has occurred and is
         continuing as of such date, (D) since December 31, 2001 there has
         occurred no material adverse change in (x) the business, assets,
         liabilities (actual or contingent), operations, or condition (financial
         or otherwise) of the Borrower or any Guarantor, or (y) any of the
         businesses, assets or liabilities acquired or assumed or being acquired
         or assumed by the Borrower or any of its Subsidiaries, (E) Purchased
         Assets have been conveyed to the Borrower pursuant to the Contribution
         Agreement, and the Borrower and its Subsidiaries own the assets and
         businesses reflected on the MLP Balance Sheet free and clear of all
         Liens other than Permitted Liens and Liens to be released on the
         Closing Date (as described in Section 4.01(h)), (F) there is no
         litigation, investigation or proceeding known to and affecting the
         Borrower or any Borrower Affiliate for which the Borrower is required
         to give notice pursuant to Section 6.03(c) (or, if there is any such
         litigation, investigation or proceeding, then a notice containing the
         information required by Section 6.03(c) shall be given concurrently
         with the delivery of the certificate given pursuant to this clause
         (v)), and (G) no action, suit, investigation or proceeding is pending
         or threatened in any court or before any arbitrator or governmental
         authority by or against the Borrower, any Guarantor, the MLP General
         Partner, or any of their respective properties, that (x) could
         reasonably be expected to materially and adversely affect the Borrower
         or any Guarantor, or (y) seeks to affect or pertains to any transaction
         contemplated hereby or the ability of the Borrower or any Guarantor to
         perform its obligations under the Loan Documents;

                  (vi) a certificate of a Responsible Officer (A) listing the
         Material Agreements then in effect, each of which shall be in form and
         substance satisfactory to the Administrative Agent, and



                                       53
<PAGE>



         (B) attaching a copy of each of the listed Material Agreements, and (C)
         certifying that each such Material Agreement has been duly executed and
         is in full force and effect;

                  (vii) a certificate of a Responsible Officer providing copies
         of the following or a copy of the MLP Registration Statement containing
         the following (A) historical audited financial information for
         predecessor entities and/or businesses for the three (3) years ended
         December 31, 2001, and historical unaudited financial information for
         predecessor entities and/or businesses for the fiscal quarters ended
         March 31, 2002, and June 30, 2002; and (B) such other financial
         information as the Administrative Agent may request;

                  (viii) opinions from (A) Baker Botts L.L.P., counsel to each
         Loan Party and the General Partner, substantially in the form of
         Exhibit F-1 hereto, and (B) local counsel to each Loan Party with
         respect to each deed of trust or mortgage executed by a Loan Party;

                  (ix) a letter from CT Corporation System, Inc., to accept
         service of process in the State of New York on behalf of the Borrower
         and each Guarantor;

                  (x) a duly completed Compliance Certificate in the form of
         Exhibit C signed by a Responsible Officer of the Borrower and a
         Responsible Officer of the MLP demonstrating pro forma compliance with
         Section 7.15 as of the Closing Date;

                  (xi) a duly completed Borrowing Base Certificate in the form
         of Exhibit H signed by a Responsible Officer of the Borrower and a
         Responsible Officer of the MLP; and

                  (xii) such other assurances, certificates, documents, consents
         or opinions as the Administrative Agent, the L/C Issuer, the Swing Line
         Lender, or the Required Lenders reasonably may require.

         (b) Any fees due and payable at the Conditions Effective Date shall
have been paid.

         (c) The Borrower shall have paid Attorney Costs of the Administrative
Agent to the extent invoiced prior to, or on, the Conditions Effective Date.

         (d) The Borrower shall be a direct or indirectly wholly-owned
subsidiary of the MLP, and Martin Resource shall own at least 51% of the MLP
General Partner.

         (e) Each Company shall have delivered the following documents:

                  (i) such Lien searches and abstracts of title as the
         Administrative Agent shall have requested, and such termination
         statements or other documents as may be necessary to confirm that the
         Collateral is subject to no other Liens (other than Permitted Liens and
         Liens to be released on the Closing Date (as described in Section
         4.01(h)) in favor of any Persons;

                  (ii) funds sufficient to pay any filing or recording tax or
         fee in connection with any and all UCC-1 financing statements or UCC-3
         amendment financing statements, or fees associated with the filing of
         the Mortgages or amendments to Mortgages;

                  (iii) evidence that the Collateral Agent has been named as
         loss payee and mortgagee under all policies of casualty insurance
         pertaining to the Collateral;




                                       54
<PAGE>



                  (iv) such consents, estoppels, subordination agreements and
         other documents and instruments executed by landlords and other Persons
         party to material contracts relating to any Collateral as to which the
         Collateral Agent shall be granted a Lien for the benefit of the
         Lenders, as requested by the Administrative Agent or any Lender;

                  (v) certificates evidencing all of the issued and outstanding
         shares of capital stock pledged pursuant to the Collateral Documents,
         which certificates shall in each case be accompanied by undated stock
         powers duly executed in blank and, with respect to uncertificated
         securities pledged pursuant to the Collateral Documents, confirmation
         and evidence satisfactory to the Administrative Agent that the security
         interest in such uncertificated securities has been transferred to and
         perfected by the Collateral Agent for the benefit of the Lenders in
         accordance with the Uniform Commercial Code; and

                  (vi) evidence that all other actions necessary or, in the
         opinion of the Administrative Agent, the Collateral Agent, or the
         Lenders, desirable to perfect and protect the first priority Lien
         created by the Collateral Documents (except to the extent otherwise
         permitted hereunder), and to enhance the Administrative Agent's and the
         Collateral Agent's ability to preserve and protect its interests in and
         access to the Collateral, have been taken;

         (f) Receipt of (i) a commitment with respect to the Stanolind Terminal
and the Tampa Terminal to issue a mortgagee's title policy issued by a title
company satisfactory to the Administrative Agent in form and substance
satisfactory to the Administrative Agent (including all waivers and endorsements
as the Administrative Agent shall reasonably require), together with the payment
of all premiums for the issuance of such title policies, (ii) surveys with
respect to the real estate Collateral satisfactory to the Administrative Agent,
(iii) certificates of title for each of the U.S. Flag Vessels, (iv) a field
audit and inventory valuation report in form and substance satisfactory to the
Administrative Agent, and (v) other information regarding the Collateral
requested by the Administrative Agent.

         (g) The Administrative Agent shall have received from an independent
appraiser acceptable to the Administrative Agent an Appraisal setting forth the
orderly liquidation value of the Fixed Assets which shall be at least
$50,000,000.

         (h) Evidence satisfactory to the Administrative Agent that all Assumed
Indebtedness will be repaid, and that all liens on the Purchased Assets securing
the Assumed Indebtedness shall be released upon the initial funding hereunder.

         The Administrative Agent shall notify the Borrower and the Lenders of
the Conditions Effective Date, and such notice shall be conclusive and binding.

         SECTION 4.02 DEADLINE FOR CONDITIONS EFFECTIVE DATE. If for any reason
the Closing Date has not occurred on or before November 30, 2002, or the
Conditions Effective Date has not occurred on or before the 5th day after the
Closing Date, then, unless otherwise agreed by all Lenders, the Aggregate
Commitments shall terminate on and as of such date.

         SECTION 4.03 CONDITIONS TO ALL LOANS AND L/C CREDIT EXTENSION. The
obligation of each Lender to honor any Committed Loan Notice or Swing Line
Notice, and the obligation of the L/C Issuer to issue any Letter of Credit, is
subject to the following conditions precedent:

         (a) The representations and warranties of the Loan Parties contained in
Article V, or which are contained in any document furnished at any time under or
in connection herewith, including, but not limited to the Collateral Documents,
shall be true and correct on and as of the date of such Loan is made,



                                       55
<PAGE>



continued or converted, as applicable, or such Letter of Credit is issued except
to the extent that such representations and warranties specifically refer to an
earlier date, in which case they shall be true and correct as of such earlier
date.

         (b) No Default or Event of Default shall exist or would result from
such proposed Loan, continuation or conversion, or L/C Credit Extension.

         (c) The Administrative Agent and, if applicable, the L/C Issuer or the
Swing Line Lender, shall have received a Request for Credit Extension and, if
applicable, a Letter of Credit Application in accordance with the requirements
hereof.

         Each Request for Credit Extension submitted by the Borrower shall be
deemed to be a representation and warranty that the conditions specified in
Sections 4.03(a) and (b) have been satisfied on and as of the date of the
applicable Credit Extension.

                                   ARTICLE V.
                         REPRESENTATIONS AND WARRANTIES

         Each of the Borrower and the MLP, and each Guarantor by its execution
of a Guaranty, represents and warrants to the Administrative Agent and the
Lenders that:

         SECTION 5.01 EXISTENCE; QUALIFICATION AND POWER; COMPLIANCE WITH LAWS.
As of the Conditions Effective Date, the Borrower is a direct or indirect
wholly-owned Subsidiary of the MLP and Martin Resource owns at least 51% of the
MLP General Partner. As of the Conditions Effective Date, CF Martin Sulphur is a
limited partnership organized, validly existing, and in good standing under the
Laws of the State of Delaware, and CF Martin Sulphur General Partner is a
limited liability company organized, validly existing, and in good standing
under the Laws of the State of Delaware. Each of the MLP General Partner, the
Borrower General Partner, and each Loan Party (a) is a corporation, partnership
or limited liability company organized or formed, validly existing and in good
standing under the Laws of the jurisdiction of its incorporation or
organization, (b) has all requisite power and authority and all governmental
licenses, authorizations, consents and approvals to own its assets, carry on its
business and to execute, deliver, and perform its obligations under the Loan
Documents to which it is a party, (c) is duly qualified and is licensed and in
good standing under the Laws of each jurisdiction where its ownership, lease or
operation of properties or the conduct of its business requires such
qualification or license, and (d) is in compliance with all Laws, except in each
case referred to in clause (c) or this clause (d), to the extent that failure to
do so could not reasonably be expected to have a Material Adverse Effect. Each
of the MLP, the Borrower, and their Subsidiaries is a citizen of the United
States as defined in Section 2 of the Shipping Act of 1916, as amended, entitled
to own and operate the Vessels under their respective Certificates of
Documentation, which the MLP, the Borrower, and Martin Gas Marine shall
maintain, or cause to be maintained, in full force and effect, and each is duly
qualified to engage in coastwise trade.

         SECTION 5.02 AUTHORIZATION; NO CONTRAVENTION. The execution, delivery
and performance by each Loan Party of each Loan Document to which such Person is
party, have been duly authorized by all necessary corporate or other
organizational action, and do not and will not (a) contravene the terms of any
of such Person's Organization Documents; (b) conflict with or result in any
breach or contravention of, or the creation of any Lien under, any material
Contractual Obligation to which such Person is a party or any order, injunction,
writ or decree of any Governmental Authority to which such Person or its
property is subject; or (c) violate any Law relating to such Loan Party.



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         SECTION 5.03 GOVERNMENTAL AUTHORIZATION. No approval, consent,
exemption, authorization, or other action by, or notice to, or filing with, any
Governmental Authority, except for the filings of mortgages and lien notices in
connection with the granting of security interests pursuant to the Collateral
Documents, is necessary or required in connection with the execution, delivery
or performance by, or enforcement against, any Loan Party of this Agreement or
any other Loan Document.

         SECTION 5.04 BINDING EFFECT. This Agreement has been, and each other
Loan Document, when delivered hereunder, will have been duly executed and
delivered by each Loan Party that is party thereto. This Agreement constitutes,
and each other Loan Document when so delivered will constitute, a legal, valid
and binding obligation of such Loan Party, enforceable against each Loan Party
that is party thereto in accordance with its terms except as such enforceability
may be limited by applicable bankruptcy, insolvency, moratorium, or other
similar laws affecting the enforcement of creditors' rights generally and
general principles of equity.

         SECTION 5.05 FINANCIAL STATEMENTS; NO MATERIAL ADVERSE EFFECT.

         (a) The Initial Financial Statements were prepared in accordance with
GAAP consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein and except for footnotes with respect to
unaudited financial statements included therein. The Initial Financial
Statements (i) fairly present the financial condition of the entities therein
named and their respective Subsidiaries as of the date thereof and their results
of operations for the period covered thereby in accordance in all material
respects with GAAP consistently applied throughout the period covered thereby,
except as otherwise expressly noted therein and except for footnotes with
respect to unaudited financial statements included therein; and (ii) show all
material indebtedness and other liabilities, direct or contingent, of the
entities therein named and their Subsidiaries as of the date thereof, including
liabilities for taxes, material commitments and Indebtedness in accordance with
GAAP consistently applied throughout the period covered thereby.

         (b) Since December 31, 2001, there has been no event or circumstance
that has or could reasonably be expected to have a Material Adverse Effect.

         SECTION 5.06 LITIGATION. There are no actions, suits, proceedings,
claims or disputes pending or, to the knowledge of the MLP or the Borrower
threatened or contemplated in writing, at law, in equity, in arbitration or
before any Governmental Authority, by or against the Borrower or any Borrower
Affiliate or against any of their properties or revenues which (a) seek to
affect or pertain to this Agreement or any other Loan Document, the borrowing of
Loans, the use of the proceeds thereof, or the issuance of Letters of Credit
hereunder, or (b) if determined adversely, could reasonably be expected to have
a Material Adverse Effect.

         SECTION 5.07 NO DEFAULT. Neither the Borrower nor any Borrower
Affiliate is in default under or with respect to any Contractual Obligation
which could be reasonably expected to have a Material Adverse Effect including
any Material Agreement. No Default or Event of Default has occurred and is
continuing or would result from the consummation of the transactions
contemplated by this Agreement or any other Loan Document.

         SECTION 5.08 OWNERSHIP OF PROPERTY; LIENS. From and after the
Conditions Effective Date, (a) each Loan Party and its Subsidiaries (i) have
valid leasehold interests in all its leased real property and (ii) have good
title to all its personal and real property (other than its leased real
property) necessary or used in the ordinary conduct of its business, except for
such defects in title as would not, individually or in the aggregate, have a
Material Adverse Effect, and (b) the property of the MLP, the Borrower and their




                                       57
<PAGE>



respective Subsidiaries is subject to no Liens, other than Permitted Liens and
Liens to be released on the Closing Date in accordance with Section 4.01(h).

         SECTION 5.09 ENVIRONMENTAL COMPLIANCE. The MLP and the Borrower have
reasonably concluded that (a) there are no claims alleging potential liability
under or responsibility for violation of any Environmental Law except any such
claims that could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect, (b) there is no environmental condition or
circumstance, such as the presence or Release of any Hazardous Substance, on any
property owned, operated or used the Borrower or any Borrower Affiliate that
could reasonably be expected to have a Material Adverse Effect, and (c) there is
no violation of or by the Borrower or any Borrower Affiliate of any
Environmental Law, except for such violations as could not, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect.


         SECTION 5.10 INSURANCE. The properties of the Borrower and the Borrower
Affiliates are insured with financially sound and reputable insurance companies
not Affiliates of the Borrower, in such amounts, with such deductibles and
covering such risks as are customarily carried by companies engaged in similar
businesses and owning similar properties in localities where the Borrower or the
Borrower Affiliates operate.

         SECTION 5.11 TAXES. The Borrower and the Borrower Affiliates have filed
all federal, state and other material tax returns and reports required to be
filed, and have paid all federal, state and other material taxes, assessments,
fees and other governmental charges levied or imposed upon them or their
properties, income or assets otherwise due and payable, except those which are
being contested in good faith by appropriate proceedings and for which adequate
reserves have been provided in accordance with GAAP. There is no proposed tax
assessment against any Borrower Affiliate or any of their respective
Subsidiaries that would, if made, have a Material Adverse Effect.

         SECTION 5.12 ERISA COMPLIANCE. The representations and warranties set
forth in this Section 5.12 shall apply only if the Borrower or an ERISA
Affiliate establishes a Plan.

         (a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state Laws except
to the extent that noncompliance could not reasonably be expected to have a
Material Adverse Effect. Each Plan that is intended to qualify under Section
401(a) of the Code has received a favorable determination letter from the IRS or
an application for such a letter is currently being processed by the IRS with
respect thereto and nothing has occurred which would prevent, or cause the loss
of, such qualification, except to the extent that nonqualification could not
reasonably be expected to have a Material Adverse Effect. The Borrower and each
ERISA Affiliate have made all required contributions to each Plan subject to
Section 412 of the Code, and no application for a funding waiver or an extension
of any amortization period pursuant to Section 412 of the Code has been made
with respect to any Plan, except to the extent that nonpayment could not
reasonably be expected to have a Material Adverse Effect.

         (b) There are no pending or threatened claims, actions or lawsuits, or
action by any Governmental Authority, with respect to any Plan that could
reasonably be expected to have a Material Adverse Effect. Neither the MLP nor
the Borrower nor any ERISA Affiliate has engaged in or permitted to occur and no
other party has engaged in or permitted to occur any prohibited transaction or
violation of the fiduciary responsibility rules with respect to any Plan that
has resulted or could reasonably be expected to result in a Material Adverse
Effect.



                                       58
<PAGE>



         (c) (i) No ERISA Event has occurred or is reasonably expected to occur
that could reasonably be expected to have a Material Adverse Effect; (ii) no
Pension Plan has any Unfunded Pension Liability that (when aggregated with any
other Unfunded Pension Liability) has resulted or could reasonably be expected
to result in a Material Adverse Effect; and (iii) neither the Borrower nor any
ERISA Affiliate has engaged in a transaction that could be subject to Sections
4069 or 4212(c) of ERISA that could reasonably be expected to have a Material
Adverse Effect.

         SECTION 5.13 SUBSIDIARIES AND OTHER INVESTMENTS. As of the Conditions
Effective Date the Borrower will have no Subsidiaries other than those
specifically disclosed in Schedule 5.13, and will have no equity investment in
any other corporation or other entity other than those specifically disclosed in
Schedule 5.13. From and after the Conditions Effective Date the MLP has no
Subsidiaries other than the Borrower, the Borrower General Partner, and the
Borrower's Subsidiaries.

         SECTION 5.14 MARGIN REGULATIONS; INVESTMENT COMPANY ACT; PUBLIC UTILITY
HOLDING COMPANY ACT; USE OF PROCEEDS.

         (a) Neither the Borrower nor any Borrower Affiliate is engaged nor will
it engage, principally or as one of its important activities, in the business of
purchasing or carrying margin stock (within the meaning of Regulation U issued
by the Board), or extending credit for the purpose of purchasing or carrying
margin stock. Margin Stock constitutes less than 25% of those assets of each
Loan Party which are subject to any limitation on a sale, pledge, or other
restrictions hereunder.

         (b) None of the Borrower, any Borrower Affiliate, any Person
controlling the Borrower or any Borrower Affiliate, or any Subsidiary thereof
(i) is a "holding company," or a "subsidiary company" of a "holding company," or
an "affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company," within the meaning of the Public Utility Holding Company Act of 1935,
or (ii) is or is required to be registered as an "investment company" under the
Investment Company Act of 1940.

         (c) The Borrower will use all proceeds of Credit Extension in the
manner set forth in Section 6.12.

         SECTION 5.15 DISCLOSURE. All material factual information hereto
furnished by or on behalf of the Borrower in writing to the Administrative Agent
or any Lender for purposes of or in connection with this Agreement or any
transaction contemplated hereby, as modified or supplemented by other
information so furnished, is true and accurate in all material respects, and
such information is not incomplete by omitting to state any material fact
necessary to make such information not misleading. All estimates and projections
delivered to the Administrative Agent or any Lender were based upon information
that was available at the time such estimates or projections were prepared and
believed to be correct and upon assumptions believed to be reasonable.

         SECTION 5.16 LABOR MATTERS. There are no actual or threatened strikes,
labor disputes, slowdowns, walkouts, or other concerted interruptions of the
MLP's, the Borrower's, or any of their Subsidiaries' operations that could
reasonably be expected to have a Material Adverse Effect.

         SECTION 5.17 COMPLIANCE WITH LAWS. Neither the Borrower nor any
Borrower Affiliate is in violation of any Laws, other than such violations which
could not, individually or collectively, reasonably be expected to have a
Material Adverse Effect. Neither the Borrower nor any Borrower Affiliate has
received notice alleging any noncompliance with any Laws, except for such
noncompliance which no longer exists, or which non-compliance could not
reasonably be expected to have a Material Adverse Effect.



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<PAGE>



         SECTION 5.18 THIRD PARTY APPROVALS. Except for consents obtained prior
to the Conditions Effective Date, no material approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any party that
is not a party to this Agreement is necessary or required in connection with the
transfer of assets to the Borrower pursuant to the Contribution Agreement or in
connection with the execution, delivery or performance by, or enforcement
against, any Loan Party of this Agreement or any other Loan Document.

         SECTION 5.19 SOLVENCY. Neither the Borrower and its Subsidiaries on a
consolidated basis nor the MLP and its Subsidiaries on a consolidated basis are
"insolvent" as such term is used and defined in (i) the United States Bankruptcy
Code or (ii) the New York Uniform Fraudulent Conveyance Act.

         SECTION 5.20 COLLATERAL.

         (a) The provisions of each of the Collateral Documents are effective to
create in favor of the Collateral Agent for the benefit of the Lenders, a legal,
valid and enforceable first priority security interest in all right, title and
interest of each Company in the Collateral described therein, except as
otherwise permitted hereunder; and the Collateral Agent is authorized to file
financing statements in the offices in all of the jurisdictions listed in the
schedule to all Security Agreements and Mortgages.

         (b) None of the terms or provisions of any indenture, mortgage, deed of
trust, agreement or other instrument to which the Borrower or any Borrower
Affiliate is a party or by which the Borrower or any Borrower Affiliate or the
property of the Borrower or any Borrower Affiliate is bound prohibit the filing
or recordation of any of the Loan Documents or any other action which is
necessary or appropriate in connection with the perfection of the Liens on
material assets evidenced and created by any of the Loan Documents.

         SECTION 5.21 CONCERNING THE VESSELS.

         (a) Schedule 5.21 sets forth a true and correct list describing each of
the Vessels owned on the Closing Date by the Borrower, the MLP, and their
Subsidiaries and correctly sets forth whether each such Vessel is owned by the
Borrower, the MLP, or one of their Subsidiaries. Each Vessel has been
appropriately registered under the laws of its jurisdiction of registration,
including, with respect to each Vessel shown on Schedule 5.21 hereof as being
registered under the laws of the United States of America (the "U.S. Flag
Vessels"), and as of the Closing Date except as disclosed to the Lenders in
writing, none of the Borrower, the MLP, or any of their Subsidiaries own any
Vessels registered under the laws of the United States of America other than the
U.S. Flag Vessels.

         (b) Each Vessel complies with all applicable maritime laws and
regulations, including, with respect to each U.S. Flag Vessel, all applicable
requirements of the Shipping Act of 1916, as amended and in effect, and all
applicable regulations thereunder and all applicable requirements of the
maritime laws of the United States of America and all applicable regulations
thereunder except in such instances in which the failure to comply therewith
could not, individually or collectively, reasonably be expected to have a
Material Adverse Effect. Each of the Borrower, the MLP, and their Subsidiaries
is a citizen of the United States for purposes of operating each of the U.S.
Flag Vessels in the coastwise trade in accordance with Section 2 of the Shipping
Act of 1916, as amended and in effect, and the regulations thereunder. Each
bareboat or demise charterer of each of the U.S. Flag Vessels operated in the
coastwise trade of the United States (i) is a citizen of the United States for
purposes of operating and maintaining such U.S. Flag Vessels in the coastwise
trade in accordance with Section 2 of the Shipping Act of 1916, as amended and
in effect, and the regulations thereunder or (ii) is in compliance with the
citizenship requirements set forth in 46 App. U.S.C.A. Section 883-1. Each of
the U.S. Flag Vessels listed on Schedule 5.21 attached hereto and which is in
operation is covered by a valid Coast Guard Certificate of Inspection, and
Schedule



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<PAGE>



5.21 attached hereto lists the U.S. Flag Vessels which have a load line
certificate and which are classed by the American Bureau of Shipping (or any
other classification society or societies satisfactory to the Administrative
Agent and the Lenders). Each U.S. Flag Vessel operated and maintained as a
vessel in the coastwise trade of the United States is so operated in accordance
with the Shipping Act of 1916, as amended and in effect, and the regulations
thereunder, and all other U.S. Flag Vessels if operated and maintained in the
coastwise trade would be eligible to be so operated in accordance with the
Shipping Act of 1916, as amended and in effect, and the regulations thereunder.
In addition to the information regarding U.S. Flag Vessels, Schedule 5.21 sets
forth a list of all other Vessels owned by the Borrower, the MLP, and their
Subsidiaries.

         (c) Each Vessel subject to a Vessel Mortgage is covered by hull and
machinery, protection and indemnity, war risk, loss of earnings and excess
liability insurance in accordance with the requirements of such Vessel Mortgage.

         SECTION 5.22 INTELLECTUAL PROPERTY; LICENSES, ETC. Each Loan Party
owns, or possesses the right to use, all of the material trademarks, service
marks, trade names, copyrights, patents, patent rights, franchises, licenses and
other intellectual property rights that are reasonably necessary for the
operation of its business. To the knowledge of each Loan Party, no such
intellectual property infringes upon any rights held by any other Person. No
claim or litigation regarding any of the foregoing is pending or, to the best
knowledge of each Loan Party, threatened, which, either individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.

                                   ARTICLE VI.
                              AFFIRMATIVE COVENANTS

         So long as any Lender shall have any Commitment hereunder, or any Loan
or other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, each of the Borrower and the MLP shall, and shall
cause each of their Subsidiaries to:

         SECTION 6.01 FINANCIAL STATEMENTS. Deliver to the Administrative Agent
and each Lender, in form and detail reasonably satisfactory to the
Administrative Agent and the Required Lenders:

         (a) within thirty (30) days of the MLP Offering Closing, a consolidated
unaudited balance sheet of the MLP and its Subsidiaries as of the MLP Offering
Closing, in reasonable detail and certified by a Responsible Officer of the MLP
as fairly presenting the financial condition of the MLP and its Subsidiaries;

         (b) as soon as available, but in any event within ninety (90) days (or
such shorter time as required to be filed with the Securities and Exchange
Commission) after the end of each fiscal year of the MLP, consolidated balance
sheets of the MLP and its Subsidiaries as at the end of such fiscal year, and
the related statements of income and cash flows for such fiscal year, setting
forth in each case in comparative form the figures for the previous fiscal year
of the MLP, if any, all in reasonable detail, audited and accompanied by a
report and opinion of KPMG LLP or other independent certified public accountant
of nationally recognized standing acceptable to the Required Lenders, which
report and opinion shall be prepared in accordance with GAAP and shall not be
subject to any qualifications or exceptions as to the scope of the audit nor to
any qualifications and exceptions not reasonably acceptable to the Required
Lenders (the preceding may be in the form of the MLP's annual report filed on
Form 10-K with the Securities and Exchange Commission; December 31 is the fiscal
year end of the MLP and the Borrower); and



                                       61
<PAGE>



         (c) as soon as available, but in any event within forty-five (45) days
(or such shorter time as required to be filed with the Securities and Exchange
Commission) after the end of each of the first three fiscal quarters of each
fiscal year of the MLP, an unaudited consolidated balance sheet of the MLP and
its Subsidiaries as at the end of such fiscal quarter, and the related
statements of income and cash flows for such fiscal quarter and for the portion
of the MLP's fiscal year then ended, setting forth in each case in comparative
form the figures for the corresponding fiscal quarter of the previous fiscal
year of the MLP, if any, and the corresponding portion of the previous fiscal
year of the MLP, if any, all in reasonable detail (the preceding may be in the
form of the MLP's annual report filed on Form 10-Q with the Securities and
Exchange Commission) and certified by a Responsible Officer of the MLP as fairly
presenting the financial condition, results of operations and cash flows of the
MLP and its Subsidiaries in accordance with GAAP, subject only to normal
year-end audit adjustments and the absence of footnotes.

         SECTION 6.02 CERTIFICATES; OTHER INFORMATION. Deliver to the
Administrative Agent and each Lender, at the expense of the Borrower, in form
and detail reasonably satisfactory to the Administrative Agent and the Required
Lenders:

         (a) concurrently with the delivery of the financial statements referred
to in Sections 6.01(b) and (c), a duly completed Compliance Certificate in form
of Exhibit C signed by a Responsible Officer of the Borrower who is a senior
financial officer and responsible for regulatory reporting and filing and a
Responsible Officer of the MLP;

         (b) promptly after the same are available, copies of each annual
report, proxy or financial statement or other report or written communication
sent to the equity owners of the MLP, and copies of all annual, regular,
periodic and special reports and registration statements which the MLP may file
or be required to file with the Securities and Exchange Commission under Section
13 or 15(d) of the Exchange Act, and not otherwise required to be delivered to
the Administrative Agent pursuant hereto;

         (c) promptly after execution thereof, copies of Material Agreements and
any material amendment thereto;

         (d) on October 31 of each year, appraisal reports in form and substance
and from appraisers satisfactory to the Administrative Agent (each such report
herein, an "Appraisal"), dated as of September 30 of such year and setting forth
the then current orderly liquidation values of all Fixed Assets, provided, that
if a Material Adverse Effect shall have occurred or a Default or Event of
Default shall have occurred and is continuing, the Administrative Agent may
obtain additional Appraisals;

         (e) as soon as possible, but not later than 12:00 noon New York, New
York time, on the last Business Day of each month, a Borrowing Base Certificate
certified by a Responsible Officer of the Borrower as fairly presenting the
Eligible Accounts Receivable and Eligible Inventory as of the last day of the
immediately preceding month, and, if requested by the Administrative Agent or
any Lender, a listing and aging of Eligible Accounts Receivable by counterparty,
and a Schedule of Eligible Inventory volumes and market rates (with sources);

         (f) on October 31 of each year, a field audit and inventory valuation
report in form and substance satisfactory to the Administrative Agent (a "Field
Audit") dated October 15 of such year and, upon the request of the
Administrative Agent and the Required Lenders in their sole discretion, one
additional Field Audit to be delivered during such year;

         (g) annually, together with the items delivered pursuant to Section
6.01(b) herein, projections of operations for the year commencing the preceding
January 1 for the MLP and its Subsidiaries based



                                       62
<PAGE>



upon information that is then currently available and believed to be correct in
good faith and upon assumptions believed to be reasonable; and

         (h) promptly, such additional information regarding the business,
financial or company affairs of any Loan Party as the Administrative Agent, at
the request of any Lender, may from time to time reasonably request, which
information may include copies of any detailed audit reports, if any, management
letters or recommendations submitted to the board of directors (or the audit
committee of the board of directors) of the Borrower by independent accountants
in connection with the accounts or books of the Borrower or any Subsidiary, or
any audit of any of them.

         SECTION 6.03 NOTICES. Promptly notify the Administrative Agent and each
Lender within ten (10) days of an officer of a Borrower Affiliate having
knowledge of any of the following:

         (a) of the occurrence of any Default or Event of Default;

         (b) of any matter that has resulted or could reasonably be expected to
result in a Material Adverse Effect, including any of the following events if
such has resulted or could reasonably be expected to result in a Material
Adverse Effect: (i) breach or non-performance of, or any default under, a
Contractual Obligation of any Loan Party; (ii) any litigation, investigation by
or required by a Governmental Authority, proceeding or suspension of licenses or
permits between any Loan Party and any Governmental Authority; (iii) any
dispute, litigation, investigation or proceeding involving any Loan Party
related to any Environmental Law;

         (c) of any litigation, investigation or proceeding and affecting the
Borrower or any Borrower Affiliate in which (i) the amount involved exceeds
(individually or collectively) $3,500,000, or (ii) injunctive relief or other
relief is sought, which could be reasonably expected to have a Material Adverse
Effect; and

         (d) of any material change in accounting policies or financial
reporting practices by the Borrower or the MLP; and

         (e) of any event that gives any owner of an equity interest in CF
Martin Sulphur or CF Martin Sulphur General Partner a right to buy the equity
interest of another owner.

         Each notice pursuant to this Section shall be accompanied by a
statement of a Responsible Officer of the Borrower setting forth details of the
occurrence referred to therein and stating what action the Borrower has taken
and proposes to take with respect thereto. Each notice pursuant to Section
6.03(a) shall describe with particularity any and all provisions of this
Agreement or other Loan Document that have been breached.

         SECTION 6.04 PAYMENT OF OBLIGATIONS. Pay and discharge as the same
shall become due and payable, all its obligations and liabilities, including (a)
all tax liabilities, assessments and governmental charges or levies upon it or
its properties or assets and (b) all lawful claims which, if unpaid, would by
law become a Lien upon its property, except, in the case of Clause (a) or (b),
where (x) the validity thereof are being contested in good faith by appropriate
proceedings and (y) adequate reserves in accordance with GAAP are being
maintained by the appropriate Loan Party.

         SECTION 6.05 PRESERVATION OF EXISTENCE, ETC. (a) Preserve, renew and
maintain in full force and effect its legal existence and good standing under
the Laws of the jurisdiction of its organization, except in a transaction
permitted by Sections 7.06 and 7.07, (b) take all action to maintain all rights,



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privileges, permits, licenses and franchises material to the conduct of its
business, except in a transaction permitted by Sections 7.06 and 7.07.

         SECTION 6.06 MAINTENANCE OF ASSETS AND BUSINESS. (a) Maintain all
material properties, equipment, licenses, permits, and franchises necessary for
its normal business; (b) keep all of its assets which are necessary to its
business in good working order and condition (ordinary wear and tear excepted)
and make all necessary repairs thereto and replacements thereof; (c) do all
things necessary to obtain, renew, extend, and continue in effect all
Authorizations which may at any time and from time to time be necessary for the
operation of its business in compliance with applicable Law, except where the
failure to so maintain, renew, extend, or continue in effect could not
reasonably be expected to have a Material Adverse Effect; (d) preserve or renew
all of its registered patents, trademarks, trade names and service marks, the
non-preservation of which could reasonably be expected to have a Material
Adverse Effect; and (e) use the standard of care typical in the industry in the
operation and maintenance of its facilities.

         SECTION 6.07 MAINTENANCE OF INSURANCE. Maintain with responsible
insurance companies insurance with respect to its properties and business
against such casualties and contingencies and of such types and in such amounts
as is customary in the case of similar businesses and which is satisfactory to
the Administrative Agent and the Required Lenders and will (i) furnish to the
Administrative Agent on each anniversary of the Effective Date a certificate or
certificates of insurance from the applicable insurance company evidencing the
existence of insurance required to be maintained by this Agreement and the other
Loan Documents and evidencing that Collateral Agent is listed as sole loss payee
on property insurance and the Administrative Agent, the Collateral Agent and
Lenders are additional insureds on liability insurance, (ii) upon request of the
Administrative Agent, furnish to each Lender at reasonable intervals a
certificate of an Authorized Officer of the Borrower setting forth the nature
and extent of all insurance maintained in accordance with this Section, and
(iii) as soon as possible, but in any event within one hundred eighty days of a
Triggering Sale resulting from an event where payments are made as a result of
any condemnation or Vessel requisition or under an insurance policy described in
this Section 6.07, furnish to the Administrative Agent a Restoration Plan.

         SECTION 6.08 COMPLIANCE WITH LAWS AND CONTRACTUAL OBLIGATIONS. (a)
Comply with the requirements of all Laws (including Environmental Laws)
applicable to it or to its business or property, except in such instances in
which (i) such requirement of Law is being contested in good faith or a bona
fide dispute exists with respect thereto; or (ii) the failure to comply
therewith could not be reasonably expected to have a Material Adverse Effect;
(b) comply with all Contractual Obligations, except where the failure to comply
therewith could not be reasonably expected to have a Material Adverse Effect,
and (c) comply with the rules and requirements of any classification society in
which any Vessel is classed except where the failure to comply therewith could
not be reasonably expected to have a Material Adverse Effect.

         SECTION 6.09 BOOKS AND RECORDS. Maintain proper books of record and
account, in which full, true and correct entries in conformity with GAAP
consistently applied shall be made of all financial transactions and matters
involving its assets and business; and (b) maintain such books of record and
account in material conformity with all applicable requirements of any
Governmental Authority having regulatory jurisdiction over it.

         SECTION 6.10 INSPECTION RIGHTS. Permit representatives and independent
contractors of the Administrative Agent and each Lender to visit and inspect any
of its properties, to examine its corporate, financial and operating records,
and make copies thereof or abstracts therefrom, and to discuss its affairs,
finances and accounts with its directors, officers, and independent public
accountants, at such reasonable times during normal business hours and as often
as may be reasonably desired, upon reasonable advance



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notice to the Borrower; provided, however, that when an Event of Default exists
the Administrative Agent or any Lender (or any of their respective
representatives or independent contractors) may do any of the foregoing at the
expense of the Borrower at any time during normal business hours and without
advance notice.

         SECTION 6.11 COMPLIANCE WITH ERISA. With respect to each Plan
maintained by a Company, do each of the following: (a) maintain each Plan in
compliance in all material respects with the applicable provisions of ERISA, the
Code and other federal or state Laws, (b) cause each Plan which is qualified
under Section 401(a) of the Code to maintain such qualification, and (c) make
all required contributions to any Plan subject to Section 412 of the Code,
except to the extent that noncompliance, with respect to each event listed
above, could not be reasonably expected to have a Material Adverse Effect.

         SECTION 6.12 USE OF PROCEEDS.

         (a) Use the proceeds of the Term Loan Facility to finance the purchase
of the Purchased Assets, including without limitation, the repayment of the
Assumed Indebtedness not repaid with the proceeds of the MLP Offering;

         (b) Use the proceeds of the Acquisition Subfacility as follows: to
finance Investments and Acquisitions by the Borrower and its Subsidiaries of
Persons or assets and Capital Expenditures subject to compliance with this
Agreement, including Sections 7.02 and 7.10; and

         (c) Use the proceeds (including Letters of Credit) of the Working
Capital/Distribution Subfacility to (i) fund working capital and general
partnership requirements of the Borrower and its Subsidiaries, including without
limitation, payments to Martin Resource pursuant to the Omnibus Agreement for
reimbursement of expenses and corporate overhead, (ii) fund Quarterly
Distributions to the extent permitted by Sections 2.01(c) and 7.08(b) and (c),
(iii) pay fees, costs and expenses owed pursuant to this Agreement and incurred
pursuant to the MLP Offering, and (iv) to finance the purchase of the Purchased
Assets, including without limitation, the repayment of the Assumed Indebtedness
not repaid with the proceeds of the MLP Offering.

         SECTION 6.13 MATERIAL AGREEMENTS. Enforce the obligations of the Martin
Parties contained in the indemnification provisions of the Omnibus Agreement,
and enforce all other obligations of the Martin Parties contained in the
Material Agreements to the same extent as they would enforce similar obligations
of unrelated third parties.

         SECTION 6.14 CONCERNING THE VESSELS. The MLP and the Borrower shall,
and shall cause each of their Subsidiaries to, at all times operate each Vessel
in compliance in all respects with all applicable governmental rules,
regulations and requirements pertaining to such Vessels (including, without
limitation, all requirements of the Shipping Act of 1916, as amended and in
effect, applicable to each U.S. Flag Vessel) and, to the extent required to be
classed, in compliance in all respects with all rules, regulations and
requirements of the applicable classification society except in such instances
in which the failure to so operate could not reasonably be expected to have a
Material Adverse Effect. The MLP and the Borrower shall, and shall cause each of
their Subsidiaries to, at all times maintain and shall assure that each demise
or bareboat charterer of the U.S. Flag Vessels operated and maintained in the
coastwise trade of the United States shall maintain, as required, its
citizenship of the United States for purposes of operating each of the U.S. Flag
Vessels in the coastwise trade in accordance with Section 2 of the Shipping Act
of 1916, as amended and in effect, and the regulations thereunder or the
citizenship requirements set forth in 46 App. U.S.C.A. Section 883-1. Upon
request of the Administrative Agent, the Borrower shall furnish to the
Administrative Agent and the Lenders the certificate of each classification
society covering each of the U.S. Flag Vessels listed on Schedule 5.21 attached
hereto no later than thirty



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(30) days after the end of each fiscal year of the MLP. The MLP and the Borrower
shall, and shall cause each of their Subsidiaries to, keep each U.S. Flag Vessel
registered under the laws of the United States and each Vessel (other than a
U.S. Flag Vessel) flagged under the laws of another jurisdiction and shall
maintain in full force and effect the Coast Guard Certificate of Inspection (or
the equivalent for any Vessel registered under the laws of another jurisdiction)
of each Vessel that is in operation and which requires such a certificate and
furnish to the Administrative Agent copies of all renewals and extensions
thereof.

         SECTION 6.15 GUARANTIES. As an inducement to the Administrative Agent
and Lenders to enter into this Agreement, cause each Subsidiary of the Borrower,
the MLP and each Subsidiary of the MLP (other than the Borrower) to execute and
deliver to the Administrative Agent a Guaranty, each substantially in the form
and upon the terms of Exhibit E-1 and Exhibit E-2, respectively, providing for
the guaranty of payment and performance of the Obligations. In addition, at the
time of the formation or acquisition of any Subsidiary, cause such Subsidiary to
execute and deliver to the Administrative Agent (a) a Guaranty substantially in
the form and upon the terms of Exhibit E-1, providing for the guaranty of
payment and performance of the Obligations, (b) Collateral Documents in form and
substance satisfactory to the Administrative Agent creating liens and security
interests in all assets and properties of such Subsidiary and in the equity
interests in such Subsidiary, and (c) certified copies of such Subsidiary's
Organization Documents and opinions of counsel with respect to such Subsidiary
and such Guaranty, in substantially the form of Exhibit F-1 hereto, and (d) such
other documents and instruments as may be required with respect to such
Subsidiary pursuant to Section 6.18.

         SECTION 6.16 COMPANY IDENTITY. The MLP and the Borrower shall do or
cause to be done (or refrain from doing or causing to be done, as the case may
be) all things necessary to ensure that the separate legal identity of the
Borrower, the MLP and, except as permitted by Section 7.06, each of their
respective Subsidiaries will at all times be respected and that none of the
Borrower, the MLP, or any of their Subsidiaries will be liable for any
obligations, contractual or otherwise, of the MLP General Partner, Martin
Resource or any other entity in which the MLP General Partner or Martin Resource
owns any equity interest, except as permitted by Sections 5.13 and 7.02. Without
limiting the foregoing, the MLP and the Borrower will, and will cause each of
their respective Subsidiaries to (a) observe all requirements, procedures and
formalities necessary or advisable in order that the MLP, the Borrower and each
of their respective Subsidiaries will for all purposes be considered validly
existing Persons separate and distinct from the MLP General Partner, Martin
Resource and their other subsidiaries, (b) not permit any commingling of the
assets of the MLP General Partner, Martin Resource or any of their other
Subsidiaries with assets of the MLP, the Borrower or any of their respective
Subsidiaries which would prevent the assets of the MLP General Partner, Martin
Resource or any of their other Subsidiaries from being readily distinguished
from the assets of the MLP, the Borrower, and their respective Subsidiaries, and
(c) take reasonable and customary actions to ensure that creditors of the MLP
General Partner, Martin Resource, and their other Subsidiaries are aware that
each such Person is an entity separate and distinct from the MLP, the Borrower,
and their respective Subsidiaries.

         SECTION 6.17 VESSEL MORTGAGES. Within one Business Day of the Closing
Date an opinion of Baker Botts L.L.P., counsel to each Loan Party executing a
Vessel Mortgage, substantially in the form of Exhibit F-2 hereto.

         SECTION 6.18 FURTHER ASSURANCES; ADDITIONAL COLLATERAL.

         (a) The Borrower and the MLP shall cause the MLP and each Subsidiary of
the Borrower and the MLP to take such actions and to execute and deliver such
documents and instruments as the Administrative Agent shall require to ensure
that the Collateral Agent on behalf of the Lenders shall, at all times, have
received currently effective duly executed Loan Documents granting Lien and
security



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interest in substantially all of the assets of the MLP and each Subsidiary of
the Borrower and the MLP, including (i) at least 80% (based on fair market
value) of the Vessels and the other fixed assets, and all accounts receivable,
inventory, equipment, general intangibles, and deposit accounts, and (ii) all
other material assets and properties of the MLP, the Borrower, and their
Subsidiaries including all capital stock, partnership, joint venture, membership
interests, or other equity interests, provided, (A) equity interests in CF
Martin Sulphur will not be pledged until (1) CF Martin Sulphur Organization
Documents no longer prohibit the MLP, the Borrower, or their Subsidiaries from
granting a Lien and security interest in equity interests in CF Martin Sulphur
or (2) Martin Resource, its Subsidiaries, or Affiliates own all the equity
interests in CF Martin Sulphur and CF Martin Sulphur General Partner and (B)
general partnership interests in the Borrower shall not be pledged by the
Borrower General Partner until (1) such time as the Borrower General Partner
Organization Documents no longer prohibit the Borrower General Partner from
granting a Lien and security interest in the general partnership interests of
the Borrower and (2) such pledge shall not result in any material adverse tax
consequences to the MLP or its Subsidiaries.

         (b) In connection with the actions required pursuant to the foregoing
subsection (a), the Borrower and the MLP shall cause the MLP and each Subsidiary
of the Borrower and the MLP to execute and deliver such stock certificates,
blank stock powers, evidence of corporate authorization, opinions of counsel,
current valuations, evidence of title, title opinions, title insurance and other
documents, and shall use commercially reasonable efforts to obtain landlord and
mortgagee waivers and third party consents, as shall be requested by the
Administrative Agent, in each case in form and substance satisfactory to the
Administrative Agent.

         (c) The Liens required by this Section 6.18 shall be perfected Liens in
favor of the Collateral Agent for the benefit of the Lenders, subject in
priority to no other Liens except Permitted Liens of the type described in
Section 7.01 (other than Section 7.01(h) and, in the case of the Vessels and
other fixed assets required to be pledged pursuant to Section 6.18(a)(i), other
than Section 7.01(b), (h), (i), (j), and (k)). If the Administrative Agent shall
determine that, as of any date, the Borrower or the MLP shall have failed to
comply with this Section 6.18, the Administrative Agent may (and at the
direction of the Required Lenders, shall) notify the Borrower in writing of such
failure and, within 30 days from and after receipt of such written notice by the
Borrower, the Borrower shall execute and deliver to the Administrative Agent
supplemental or additional Loan Documents, in form and substance satisfactory to
the Administrative Agent and its counsel, securing payment of the Notes and the
other Obligations and covering additional assets and properties not then
encumbered by any Loan Documents (together with such other information, as may
be requested by the Administrative Agent, each of which shall be in form and
substance reasonably satisfactory to the Administrative Agent) such that the
Administrative Agent shall have received currently effective duly executed and
perfected Collateral Documents encumbering substantially all of the assets of
the MLP, the Borrower and each of their respective Subsidiaries as required by
Section 6.18(a).

                                  ARTICLE VII.
                               NEGATIVE COVENANTS

         So long as any Lender shall have any Commitment hereunder, or any Loan
or other Obligations shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, each of the MLP and the Borrower agree that they shall
not, nor shall they permit any of their respective Subsidiaries to, directly or
indirectly:

         SECTION 7.01 LIENS. Create, incur, assume or suffer to exist, any Lien
upon any of its property, assets or revenues, whether now owned or hereafter
acquired, other than the following:

         (a) Liens pursuant to any Loan Document;



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         (b) (i) Liens existing on the Purchased Assets securing the Assumed
Indebtedness that will be repaid on the date of the initial funding hereunder
with the proceeds of the MLP Offering which shall be released upon such Assumed
Indebtedness repayment and (ii) Liens existing on the Conditions Effective Date
and listed on Schedule 7.01 and any renewals or extensions thereof, provided
that the property covered thereby is not increased, the amount of the
Indebtedness secured thereby is not increased, and any of the Indebtedness
thereby secured is permitted by Section 7.04(e);

         (c) Liens for taxes not yet due or which are being contested in good
faith and by appropriate proceedings, if adequate reserves with respect thereto
are maintained on the books of the applicable Person in accordance with GAAP;

         (d) carriers', warehousemen's, mechanics', materialmen's, repairmen's
or other like Liens arising in the ordinary course of business which are not
overdue for a period of more than thirty (30) days or which are being contested
in good faith and by appropriate proceedings, if adequate reserves with respect
thereto are maintained on the books of the applicable Person in accordance with
GAAP;

         (e) pledges or deposits in the ordinary course of business in
connection with workers' compensation, unemployment insurance and other social
security legislation, other than any Lien imposed by ERISA;

         (f) deposits to secure the performance of bids, trade contracts (other
than for borrowed money), leases, statutory obligations, surety and appeal
bonds, performance bonds and other obligations of a like nature, in each case
incurred in the ordinary course of business;

         (g) easements, rights-of-way, restrictions and other similar
encumbrances affecting real property which (i) are described in any title policy
delivered with respect to the Collateral, or (ii) do not materially interfere
with the ordinary conduct of the business of the applicable Person;

         (h) judgment Liens not giving rise to an Event of Default;

         (i) any Lien existing on any asset (other than stock of a Subsidiary)
prior to acquisition thereof by the Borrower or a Subsidiary, and not created in
contemplation of such acquisition, provided that (i) no such Lien shall be
extended to cover property other than the asset being acquired, and (ii) the
Indebtedness thereby secured is permitted by Section 7.04(e);

         (j) Liens securing Capitalized Lease obligations provided that the
Indebtedness in respect of such Capitalized Lease is permitted under Section
7.04(e);

         (k) Purchase money Liens upon or in any property acquired by Borrower
or any of its Subsidiaries to secure the deferred portion of the purchase price
of such property or to secure Indebtedness incurred to finance the acquisition
of such property and refinancings, renewals, and extensions of such Liens,
provided that (i) no such Lien shall be extended to cover property other than
the property being acquired, and (ii) the Indebtedness thereby secured is
permitted by Section 7.04(e);

         (l) Liens reserved in or exercisable under any lease or sublease
permitted under Section 7.05 to which the Borrower or a Subsidiary is a lessee
which secure the payment of rent or compliance with the terms of such lease or
sublease; provided, that the rent under such lease or sublease is not then
overdue for a period of thirty (30) days;



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         (m) any interest or title of a lessor under any lease permitted under
Section 7.05 entered into by the Borrower or any Subsidiary in the ordinary
course of its business and covering only the assets so leased;

         (n) Liens incurred in the ordinary course of business in connection
with margin requirements under Swap Contracts not to exceed in the aggregate
$250,000 at any time outstanding;

         (o) interests of lessees in leases under which such Person is a lessor,
provided such leaseholds are otherwise not prohibited by the terms of this
Agreement;

         (p) Liens in favor of collecting or payor banks having a right of
setoff, revocation, refund or chargeback with respect to money or instruments of
the MLP or any Subsidiary on deposit with or in possession of such bank; and

         (q) Liens represented by the escrow of cash or Cash Equivalents, and
the earnings thereon, securing the obligations of the Borrower or any of its
Subsidiaries under any agreement to acquire, or pursuant to which it acquired,
assets Reinvested in accordance with this Agreement or other assets or property
which it is permitted to acquire pursuant to Section 7.02 securing the
obligations of the Borrower or any of its Subsidiaries to the seller of the
property under any agreement pursuant to which the Borrower or any of its
Subsidiaries may acquire assets Reinvested in accordance with this Agreement or
other assets or property which the Borrower or its Subsidiaries are permitted to
acquire pursuant to Section 7.02.

         SECTION 7.02 INVESTMENTS AND ACQUISITIONS. Make any Acquisitions or
make or own any Investments, except:

         (a) Acquisition of assets by the Borrower on the Conditions Effective
Date pursuant to the Contribution Agreement;

         (b) Investments existing on the Conditions Effective Date and listed in
Section (b) of Schedule 5.13;

         (c) cash or Cash Equivalents;

         (d) Investments constituting Indebtedness permitted under Section 7.04;

         (e) Investments by the MLP in the Borrower;

         (f) Investments by the Borrower and its Subsidiaries in any Subsidiary
of the Borrower that, prior to such Investment, is a Guarantor;

         (g) Investments made after the Closing Date in CF Martin Sulphur which
do not exceed $2,500,000 in the aggregate; provided, no additional Investments
otherwise permitted under this clause (g) shall be permitted to be made at any
time a Default or Event of Default has occurred and is continuing;

         (h) trade accounts receivable which are for goods furnished or services
rendered in the ordinary course of business;

         (i) Permitted Acquisitions by the Borrower or its Subsidiaries;



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         (j) Investments received in satisfaction or partial satisfaction of
accounts receivable from financially troubled account debtors to the extent
reasonably necessary in order to prevent or limit loss;

         (k) Guaranty Obligations permitted by Section 7.04; and

         (l) Investments resulting from transactions permitted by Section 7.06.

         SECTION 7.03 HEDGING AGREEMENTS. Enter into any Swap Contracts other
than in the ordinary course of business for the purpose of protecting against
fluctuations in interest rates, commodity prices, or foreign exchange rates and
not for purposes of speculation, provided that the Swap Contract shall not
contain any provision exonerating the non-defaulting party from its obligation
to make payments on outstanding transactions to the defaulting party.

         SECTION 7.04 INDEBTEDNESS. Create, incur, or assume any Indebtedness
except:

         (a) Indebtedness incurred pursuant to the Loan Documents;

         (b) Indebtedness owed by a Subsidiary to the Borrower or to a
Wholly-Owned Subsidiary or by the Borrower to a Guarantor, provided, that, to
the extent such Indebtedness is evidenced by a promissory note, such note shall
be pledged to secure the Obligations and is in the possession of the Collateral
Agent;

         (c) Other Indebtedness of the Borrower and the MLP ("Subordinated
Indebtedness") which Subordinated Indebtedness shall be subordinated to the
Obligations pursuant to a subordination agreement containing terms in form and
substance satisfactory to the Administrative Agent and the Majority Lenders (a
"Subordination Agreement"), provided that such Subordinated Indebtedness shall
bear a market rate of interest, shall not require any payment of principal
earlier than six (6) months after the Stated Maturity Date, and the Net Cash
Proceeds thereof shall be used to prepay the Loans and reduce the Commitments
pursuant to Section 2.04(b);

         (d) obligations (contingent or otherwise) of the Borrower, the MLP or
any Subsidiary existing or arising under any Swap Contract to the extent
permitted by Section 7.03; and

         (e) Other Indebtedness of the MLP, the Borrower and their respective
Subsidiaries not to exceed $5,000,000 in aggregate principal amount outstanding
at any time.

Provided, that if any Indebtedness is incurred pursuant to this Section 7.04,
both before and after such Indebtedness is created, incurred or assumed, no
Default or Event of Default shall exist.

         SECTION 7.05 LEASE OBLIGATIONS. Create or suffer to exist any
obligations for the payment of rent by such Person as lessee for any property
under lease or agreement to lease (other than those constituting Synthetic Lease
Obligations or Capital Leases), except for operating leases entered into or
assumed by the Borrower or any Subsidiary in the ordinary course of business,
provided that, such operating leases will not require the payment of an
aggregate amount of annual payments in excess of $5,000,000.

         SECTION 7.06 FUNDAMENTAL CHANGES. Merge or consolidate with or into, or
convey, transfer, lease or otherwise dispose of (whether in one transaction or
in a series of transactions) all or substantially all of its assets (whether now
owned or hereafter acquired) to or in favor of any Person, except that, so long
as no Default or Event of Default exists or would result therefrom:



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         (a) any Person may merge into the Borrower provided that the Borrower
is the surviving entity and the requirements set forth in the definition of
Permitted Acquisition (other than clause (a)) with respect to Investments are
satisfied;

         (b) any Subsidiary may merge with (i) the Borrower, provided that the
Borrower shall be the continuing or surviving Person, or (ii) any one or more
Subsidiaries, provided that when any Wholly-Owned Subsidiary is merging with
another Subsidiary, a Wholly-Owned Subsidiary shall be the continuing or
surviving Person;

         (c) any Subsidiary may sell all or substantially all of its assets
(upon voluntary liquidation or otherwise), to the Borrower or to another
Subsidiary; provided that if the seller in such a transaction is a Wholly-Owned
Subsidiary, then the purchaser must also be the Borrower or a Wholly-Owned
Subsidiary;

         (d) any Person (other than the Borrower or a Subsidiary of the
Borrower) may merge into any Subsidiary provided that such Subsidiary is the
surviving entity and the requirements set forth in the definition of Permitted
Acquisition with respect to Investments are satisfied; and

         (e) the Borrower and each Subsidiary may make Dispositions permitted by
Section 7.07.

         SECTION 7.07 DISPOSITIONS. Make any Disposition or enter into any
agreement to make any Disposition, except:

         (a) Dispositions by the Borrower or its Subsidiaries of inventory or
obsolete equipment in the ordinary course of business;

         (b) Dispositions by any Subsidiary to the Borrower, or by any
Subsidiary or by the Borrower, to a Wholly-Owned Subsidiary that is a Guarantor;

         (c) Dispositions of the Maricopa, Arizona Fertilizer Plant; or

         (d) other Dispositions for fair market value, provided no Default or
Event of Default then exists or arises as a result thereof, provided that if a
prepayment is required by Section 2.04(b)(i), the Borrower shall make such
prepayment in accordance with such Section.

         SECTION 7.08 RESTRICTED PAYMENTS; DISTRIBUTIONS AND REDEMPTIONS.
Declare or make, directly or indirectly, any Restricted Payment, or incur any
obligation (contingent or otherwise) to do so, except that:

         (a) each Subsidiary may make Restricted Payments to the Borrower and to
Wholly-Owned Subsidiaries of the Borrower (and, in the case of a Restricted
Payment by a non-wholly-owned Subsidiary, to the Borrower and any Subsidiary and
to each owner of capital stock or other equity interest of such Subsidiary on a
pro rata basis based on their relative ownership interests);

         (b) the Borrower may declare and make Quarterly Distributions of
Available Cash as defined in the Limited Partnership Agreement (Borrower) as in
effect on the Closing Date (including, without limitation, distributions of the
proceeds of Distribution Loans) to the extent such Quarterly Distributions are
made in accordance with the Limited Partnership Agreement (Borrower); provided,
that at the time each such Quarterly Distribution is made no Default or Event of
Default exists or would result therefrom;

         (c) the MLP may (i) declare and make Quarterly Distributions of
Available Cash as defined in the Limited Partnership Agreement (MLP) as in
effect on the Closing Date (including, without



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limitation, distributions of the proceeds of Distribution Loans) to the extent
such Quarterly Distributions are made in accordance with the Limited Partnership
Agreement (MLP) and (ii) purchase units under and in accordance with any MLP
Long-Term Incentive Plan (as defined in the Limited Partnership Agreement
(MLP)); provided, that at the time each such Quarterly Distribution or purchase
is made no Default or Event of Default exists or would result therefrom; and

         (d) the MLP may declare and make dividend payments or other
distributions payable solely in common units.

         SECTION 7.09 ERISA. At any time engage in a transaction which could be
subject to Section 4069 or 4212(c) of ERISA, or permit any Plan maintained by a
Company to (a) engage in any non-exempt "prohibited transaction" (as defined in
Section 4975 of the Code); (b) fail to comply with ERISA or any other applicable
Laws; or (c) incur any material "accumulated funding deficiency" (as defined in
Section 302 of ERISA), which, with respect to each event listed above, could be
reasonably expected to have a Material Adverse Effect.

         SECTION 7.10 NATURE OF BUSINESS; CAPITAL EXPENDITURES. Engage in any
line of business other than the Midstream Business, or make any Capital
Expenditures or Acquisitions or Investments permitted by Section 7.02 except in
connection with the Midstream Business. The MLP may not engage in any business
other than ownership of the Borrower and the operation of the MLP.

         SECTION 7.11 TRANSACTIONS WITH AFFILIATES. Sell, lease, or otherwise
transfer any property or assets to, or purchase, lease, or otherwise acquire any
property or assets from, or otherwise engage in any other transactions with, any
of its Affiliates, except (a) transactions in the ordinary course of business
and upon fair and reasonable terms no less favorable to the Borrower, the MLP,
or such Subsidiary than such Person could obtain in a comparable arm's length
transaction with a Person not an Affiliate of the Borrower, the MLP, or such
Subsidiary, (b) transactions among the Borrower Affiliates, (c) any Restricted
Payment permitted by Section 7.08, or (d) transactions pursuant to the
agreements described in clauses (a) through (p) of the definition of Material
Agreements, which agreements in the opinion of the Borrower when taken as a
whole are fair and reasonable to the Borrower, the MLP, and their Subsidiaries.

         SECTION 7.12 BURDENSOME AGREEMENTS. Enter into any Contractual
Obligation that limits the ability of any Subsidiary to make Restricted Payments
to the Borrower or to otherwise transfer property to the Borrower; provided that
the foregoing shall not apply to restrictions and conditions (i) imposed by law
or by any Loan Document, (ii) existing on the date hereof identified on Schedule
7.01 (but shall apply to any extension or renewal of, or any amendment or
modification expanding the scope of, any such restriction or condition), (iii)
contained in agreements relating to a Disposition to a Person who is not an
Affiliate of the MLP or any of its Subsidiaries pending such Disposition,
provided such restrictions and conditions apply only to the property or assets
to be subject to such Disposition and such Disposition is permitted hereunder,
(iv) imposed by any agreement relating to secured Indebtedness permitted by this
Agreement if such restrictions or conditions apply only to the property or
assets securing such Indebtedness and (v) customary provisions in leases and
other contracts restricting the assignment thereof.

         SECTION 7.13 USE OF PROCEEDS. Use the proceeds of any Loan for purposes
other than those permitted by Section 6.12, or use the proceeds of any Loan,
whether directly or indirectly, and whether immediately, incidentally or
ultimately, to purchase or carry margin stock (within the meaning of Regulation
U of the Board) or to extend credit to others for the purpose of purchasing or
carrying margin stock or to refund indebtedness originally incurred for such
purpose.

         SECTION 7.14 AMENDMENTS TO MATERIAL AGREEMENTS; AMENDMENT TO OMNIBUS
AGREEMENT ADMINISTRATIVE FEE. Permit any amendment to any Borrower Operating
Agreement or any Material



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Agreement, if such amendment could reasonably be expected to have a Material
Adverse Effect. Without limiting the foregoing, no amendment shall be made to
the Omnibus Agreement that shall increase the annual $1,000,000 administrative
fee paid to Martin Resource (other than (i) adjustments approved by the
Conflicts Committee (as defined in the Limited Partnership Agreement (MLP)) to
account for adjustments in the nature of the services provided by Martin
Resource and/or its Affiliates as a result of acquisitions by the MLP and its
Subsidiaries or other expansions of the business of the MLP and its Subsidiaries
and (ii) inflation adjustments made pursuant to the terms of the Omnibus
Agreement as in effect on the Closing Date).

         SECTION 7.15 FINANCIAL COVENANTS.

         (a) Interest Coverage Ratio. Permit the Interest Coverage Ratio as of
the end of any fiscal quarter to be less than the ratio of 3.0 to 1.0.

         (b) Leverage Ratio. Permit the Leverage Ratio at any time to be greater
than the ratio of 3.5 to 1.0.

         (c) Minimum Net Worth. Permit the Net Worth at any time to be less than
$35,000,000.

         (d) Current Ratio. Permit the Current Ratio as of the end of any fiscal
quarter to be less than the ratio of 1.10 to 1.00.

         (e) Fixed Asset Coverage. Permit at any time the orderly liquidation
value of the Fixed Assets subject to the Collateral Documents as set forth in
the most current Appraisal delivered to the Administrative Agent pursuant to
Section 6.02(d) (the "OLV" which value shall be net of any Indebtedness (other
than the Obligations) secured by a Lien on the applicable assets) to be less
than 200% of the sum of Acquisition/Term Outstandings. As used in this Section,
"Acquisition/Term Outstandings" at any time means the sum of (i) the Term Loan
Principal Debt and (ii) Revolver Principal Debt outstanding at such time under
the Acquisition Subfacility. If on any date such OLV is less than 200% of the
Acquisition/Term Outstandings, then the Borrower shall, as soon as possible, but
in any event within thirty (30) days make a mandatory payment of Committed Loans
in an amount sufficient to cause a reduction of the Acquisition/Term
Outstandings such that the OLV is equal to or greater than 200% of the
Acquisition/Term Outstandings.

         (f) Adjustments for Acquisitions. For purposes of calculating the
Interest Coverage Ratio and the Leverage Ratio, Consolidated EBITDA and
Consolidated Interest Charges shall be adjusted on a pro forma basis (in a
manner acceptable to the Administrative Agent if unaudited or by an independent
certified public accountant of nationally recognized standing acceptable to the
Administrative Agent) for any Person or assets sold or acquired and any
Indebtedness incurred or assumed after the beginning of any four-fiscal quarter
period being measured with respect to such ratios as if such assets had been
sold or acquired at the beginning of such four-fiscal quarter period.

         SECTION 7.16 CAPITAL EXPENDITURES. Permit (a) annual capital
expenditures of the MLP, the Borrower, and their Subsidiaries to exceed the sum
of $10,000,000 and the Additional Amount and (b) capital expenditures to be used
for purposes other than those related to the Midstream Business. For purposes of
this Section 7.16, "Additional Amount" shall mean, for any fiscal year of the
MLP, the Borrower, and their Subsidiaries, an amount of capital expenditures
equal to $10,000,000 less capital expenditures made for the previous fiscal year
(capital expenditures for the previous fiscal year shall not include any portion
of the Additional Amount calculated for the previous fiscal year).



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         SECTION 7.17 SUBORDINATED INDEBTEDNESS. Neither the Borrower nor the
MLP will amend documents governing Subordinated Indebtedness unless approved in
writing by the Required Lenders. The Borrower shall not make any payments of
interest or any other amounts in respect of the Subordinated Indebtedness if a
Default or Event of Default shall have occurred and be continuing or would
result from such payment. The Borrower will not repay any principal, interest or
other indebtedness in respect of the Subordinated Indebtedness, or make any
redemption or acquisition for value or defeasance, refinancing or exchange
thereof or therefore, or make any payments in contravention of the applicable
Subordination Agreement.

                                  ARTICLE VIII.
                         EVENTS OF DEFAULT AND REMEDIES

         SECTION 8.01 EVENTS OF DEFAULT. Any of the following shall constitute
an Event of Default:

         (a) Non-Payment. The Borrower fails to pay (i) when and as required to
be paid herein, any amount of principal of any Loan or any L/C Obligation or
(ii) within five (5) Business Days after the same becomes due, any interest on
any Loan, any L/C Obligation, any commitment or other fee due hereunder, or any
other amount payable hereunder or under any other Loan Document; or

         (b) Specific Covenants. The Borrower fails to perform or observe any
term, covenant or agreement contained in any of Section 6.03(a), 6.05 (with
respect to the MLP's and the Borrower's existence), 6.12, or Article VII; or

         (c) Other Defaults. Any Loan Party fails to perform or observe any
other covenant or agreement (not specified in subsection (a) or (b) above)
contained in any Loan Document on its part to be performed or observed and such
failure continues for 30 days after the earlier of (i) the date notice has been
given to the Borrower by the Administrative Agent or a Lender or (ii) the date a
Responsible Officer knew or reasonably should have known of such Default; or

         (d) Representations and Warranties. Any representation or warranty made
or deemed made by the Borrower or any other Loan Party herein, in any other Loan
Document, or in any document delivered in connection herewith or therewith
proves to have been incorrect in any material respect when made or deemed made;
or

         (e) Cross-Default. (i) The Borrower or any other Loan Party (A) fails
to make any payment when due (whether by scheduled maturity, required
prepayment, acceleration, demand, or otherwise) in respect of any Indebtedness
or Guaranty Obligation (other than Indebtedness under Swap Contracts) having an
aggregate principal amount (or, in the case of a Capitalized Lease or a
Synthetic Lease Obligation, Attributable Indebtedness) (including undrawn or
available amounts and including amounts owing to all creditors under any
combined or syndicated credit arrangement) of more than (individually or
collectively) $3,500,000, or (B) fails to observe or perform any other agreement
or condition relating to any such Indebtedness or Guaranty Obligation or
contained in any instrument or agreement evidencing, securing or relating
thereto, or any other event occurs, the effect of which default or other event
is to cause, or to permit the holder or holders of such Indebtedness, the lessor
under such Synthetic Lease Obligation or the beneficiary or beneficiaries of
such Guaranty Obligation (or a trustee or agent on behalf of such holder or
holders or beneficiary or beneficiaries) to cause, with the giving of notice if
required, such Indebtedness to be demanded or to become due or to be repurchased
or redeemed (automatically or otherwise) prior to its stated maturity, or such
Guaranty Obligation to become payable or cash collateral in respect thereof to
be demanded; or (ii) (A) there occurs under any Swap Contract an Early
Termination Date (as defined in such Swap Contract)resulting from any event of
default under such Swap Contract as to which the Borrower or any other Loan
Party is the Defaulting Party (as defined in such Swap Contract)



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and the Swap Termination Value owed by the Borrower or any other Loan Party as a
result thereof is greater than (individually or collectively) $3,500,000, or (B)
there occurs under any Swap Contract an Early Termination Date (as defined in
such Swap Contract) resulting from any Termination Event (as so defined) under
such Swap Contract as to which the Borrower or any other Loan Party is an
Affected Party (as so defined) and the Swap Termination Value owed by the
Borrower and other Loan Party as a result thereof is greater than (individually
or collectively) $3,500,000 and such amount is not paid when due under such Swap
Contract, or (iii) there occurs an Event of Default (as such term is defined in
any Collateral Document); or

         (f) Insolvency Proceedings, Etc. (i) (A) The Borrower or any Borrower
Affiliate or CF Martin Sulphur or CF Martin Sulphur General Partner institutes
or consents to the institution of any proceeding under any Debtor Relief Law, or
makes an assignment for the benefit of creditors; or applies for or consents to
the appointment of any receiver, trustee, custodian, conservator, liquidator,
rehabilitator, or similar officer for it or for all or any material part of its
property or takes any action to effect any of the foregoing; or (B) any
receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar
officer is appointed without the application or consent of such Person and the
appointment continues undischarged or unstayed for 60 calendar days; or (C) any
proceeding under any Debtor Relief Law relating to any such Person or to all or
any part of its property is instituted without the consent of such Person and
continues undismissed or unstayed for 60 calendar days, or an order for relief
is entered in any such proceeding; (ii) (A) Martin Resource institutes or
consents to the institution of any proceeding under any Debtor Relief Law, or
makes an assignment for the benefit of creditors; or applies for or consents to
the appointment of any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer for it or for all or any material part of its
property or takes any action to effect any of the foregoing; or (B) any
receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar
officer is appointed without the application or consent of such Person and the
appointment continues undischarged or unstayed for 60 calendar days; or (C) any
proceeding under any Debtor Relief Law relating to any such Person or to all or
any part of its property is instituted without the consent of such Person and
continues undismissed or unstayed for 60 calendar days, or an order for relief
is entered in any such proceeding provided, in the case of any event described
in this clause (ii), that such event could reasonably be expected to have a
Material Adverse Effect; or

         (g) Inability to Pay Debts; Attachment. (i) The Borrower or any
Borrower Affiliate, CF Martin Sulphur, CF Martin Sulphur General Partner, or any
of their respective Subsidiaries becomes unable or admits in writing its
inability or fails generally to pay its debts as they become due, or (ii) any
writ or warrant of attachment or execution or similar process is issued or
levied against property which is a material part of the property of the Borrower
and its Subsidiaries taken as a whole, and is not released, vacated or fully
bonded within 45 days after its issue or levy; or

         (h) Judgments. (i) There is entered against the Borrower or any other
Loan Party (other than the MLP General Partner) or (A) a final judgment or order
for the payment of money in an aggregate amount exceeding (individually or
collectively) $3,500,000 (to the extent not covered by third-party insurance as
to which the insurer does not dispute coverage), or (B) any non-monetary final
judgment that has or could reasonably be expected to have a Material Adverse
Effect and, in either case, (1) enforcement proceedings are commenced by any
creditor upon such judgment or order, or (2) there is a period of 30 consecutive
days during which a stay of enforcement of such judgment, by reason of a pending
appeal or otherwise, is not in effect; (ii) there is entered against Martin
Resource (A) a final judgment or order for the payment of money that could
reasonably be expected to have a Material Adverse Effect or (B) any non-monetary
final judgment that has or could reasonably be expected to have a Material
Adverse Effect and, in either case, (1) enforcement proceedings are commenced by
any creditor upon such judgment or order, or (2) there is a period of 30
consecutive days during which a stay of enforcement of such judgment, by reason
of a pending appeal or otherwise, is not in effect; or



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         (i) ERISA. (i) If the Borrower, any other Loan Party or any of their
ERISA Affiliates maintains any Pension Plan or any Multiemployer Plan, an ERISA
Event occurs with respect to a Pension Plan or Multiemployer Plan which has
resulted or could reasonably be expected to result in liability of the Borrower
or any other Loan Party under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of $3,500,000,
or (ii) if there is any Multiemployer Plan, the Borrower, any other Loan Party
or any ERISA Affiliate thereof fails to pay when due, after the expiration of
any applicable grace period, any installment payment with respect to its
withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan in
an aggregate amount in excess of $3,500,000; or

         (j) Invalidity of Loan Documents. Any Loan Document, at any time after
its execution and delivery and for any reason other than the agreement of all
the Lenders or termination of all Commitments and satisfaction in full of all
the Obligations, ceases to be in full force and effect, or is declared by a
court of competent jurisdiction to be null and void, invalid or unenforceable in
any material respect; or any Loan Party denies that it has any or further
liability or obligation under any Loan Document (except for a Loan Party
released therefrom pursuant to a Disposition or other transaction permitted
hereunder), or purports to revoke, terminate or rescind any Loan Document; or

         (k) Change of Control. There occurs any Change of Control; or

         (l) Dissolution. The Borrower or any Borrower Affiliate shall dissolve,
liquidate, or otherwise terminate its existence, except as permitted in Section
7.06; or

         (m) Material Agreements. (i) Termination of any Material Agreement or
any material provision of any of the foregoing if such termination could
reasonably be expected to have a Material Adverse Effect and such agreement or
provision is not replaced (prior to such cessation) in a manner that will
prevent such Material Adverse Effect; (ii) default by any Person in the
performance or observance of any material term of any Material Agreement which
is not cured within the applicable cure period specified in such Material
Agreement, if such default could reasonably be expected to have a Material
Adverse Effect; or (iii) any Unauthorized Assignment shall occur; or

         (n) Collateral; Impairment of Security, etc. (i) Any provision of any
Loan Document shall for any reason cease to be valid and binding on or
enforceable against a Loan Party or any Loan Party shall so state in writing or
bring an action to limit its obligations or liabilities thereunder; or (ii) any
Collateral Document shall for any reason (other than pursuant to the terms
thereof) cease to create a valid security interest in the Collateral purported
to be covered thereby or such security interest shall for any reason cease to be
a perfected and first priority security interest subject to Permitted Liens; or
(iii) any provision of a Subordination Agreement shall cease to be effective or
shall not be enforceable, or any holder of Subordinated Indebtedness shall seek
to invalidate any provision of a Subordination Agreement; or

         (o) Investment Reduction Event. There occurs any Investment Reduction
Event.

         SECTION 8.02 REMEDIES UPON EVENT OF DEFAULT. If any Event of Default
occurs, the Administrative Agent:

         (a) (i) shall, at the request of, or may, with the consent of the
Required Term Lenders, declare the commitment of each Term Lender to make Loans
under the Term Loan Facility to be terminated, whereupon such commitments shall
be terminated; and (ii) shall, at the request of, or may, with the consent of
the Required Revolver Lenders declare the commitment of each Revolver Lender to



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make Loans and any obligation of the L/C Issuer to make L/C Credit Extensions to
be terminated, whereupon such commitments and obligations shall be terminated;

         (b) shall, at the request of, or may, with the consent of the Required
Lenders, declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest, notice of intent to accelerate, notice of
acceleration or other notice of any kind, all of which are hereby expressly
waived by the Borrower;

         (c) shall, at the request of, or may, with the consent of the Required
Lenders, declare that an amount equal to the then Outstanding Amount of all L/C
Obligations be immediately due and payable by the Borrower, without presentment,
demand, protest, notice of intent to accelerate, notice of acceleration or other
notice of any kind, all of which are hereby expressly waived by the Borrower,
and require that the Borrower deliver such payments to the Administrative Agent
to Cash Collateralize the L/C Obligations (in an amount equal to the then
Outstanding Amount thereof); and

         (d) shall, at the request of, or may, with the consent of the Required
Lenders, exercise on behalf of itself and the Lenders all rights and remedies
available to it and the Lenders under the Loan Documents or applicable law;

provided, however, that upon the occurrence of any event specified in subsection
(f)(i) of Section 8.01, the obligation of each Lender to make Loans and any
obligation of the L/C Issuer to make L/C Credit Extensions shall automatically
terminate, the unpaid principal amount of all outstanding Loans and all interest
and other amounts as aforesaid shall automatically become due and payable, and
an amount equal to the then Outstanding Amount of all L/C Obligations shall be
deemed to be forthwith due and owing by the Borrower to the L/C Issuer and the
Lenders as of the date of such occurrence and the Borrower's obligation to pay
such amounts shall be absolute and unconditional, without regard to whether any
beneficiary of any such Letter of Credit has attempted to draw down all or a
portion of such amount under the terms of a Letter of Credit and, to the fullest
extent permitted by applicable law, shall not be subject to any defense or be
affected by a right of set-off, counterclaim or recoupment which the Borrower
may now or hereafter have against any such beneficiary, the L/C Issuer, the
Administrative Agent, the Lenders or any other Person for any reason whatsoever.
Such payments shall be delivered to and held by the Collateral Agent as cash
collateral securing the L/C Obligations.

                                   ARTICLE IX.
                                     AGENTS

         SECTION 9.01 APPOINTMENT AND AUTHORIZATION OF ADMINISTRATIVE AGENT AND
COLLATERAL AGENT; LENDER HEDGING AGREEMENTS.

         (a) Each Lender hereby irrevocably (subject to Section 9.10) appoints,
designates and authorizes each of the Administrative Agent and the Collateral
Agent to take such action on its behalf under the provisions of this Agreement
and each other Loan Document and to exercise such powers and perform such duties
as are expressly delegated to it by the terms of this Agreement or any other
Loan Document, together with such powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary contained elsewhere herein or in
any other Loan Document, neither the Administrative Agent nor the Collateral
Agent shall have any duties or responsibilities, except those expressly set
forth herein, nor shall either the Administrative Agent or the Collateral Agent
have or be deemed to have any fiduciary relationship with any Lender or
participant, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against the Administrative Agent or the Collateral
Agent. Without



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limiting the generality of the foregoing sentence, the use of the term "agent"
herein and in the other Loan Documents with reference to the Administrative
Agent or the Collateral Agent is not intended to connote any fiduciary or other
implied (or express) obligations arising under agency doctrine of any applicable
law. Instead, such term is used merely as a matter of market custom, and is
intended to create or reflect only an administrative relationship between
independent contracting parties.

         (b) The L/C Issuer shall act on behalf of the Lenders with respect to
any Letters of Credit issued by it and the documents associated therewith until
such time (and except for so long) as the Administrative Agent may agree at the
request of the Required Lenders to act for the L/C Issuer with respect thereto;
provided, however, that the L/C Issuer shall have all of the benefits and
immunities (i) provided to the Administrative Agent in this Article IX with
respect to any acts taken or omissions suffered by the L/C Issuer in connection
with Letters of Credit issued by it or proposed to be issued by it and the
application and agreements for letters of credit pertaining to the Letters of
Credit as fully as if the term "Administrative Agent" as used in this Article IX
included the L/C Issuer with respect to such acts or omissions, and (ii) as
additionally provided herein with respect to the L/C Issuer.

         (c) To the extent any Lender or any Affiliate of a Lender is a party to
a Lender Hedging Agreement and accepts the benefits of the Liens in the
Collateral arising pursuant to the Collateral Documents, such Lender (for itself
and on behalf of any such Affiliates) shall be deemed (i) to appoint Royal Bank,
as its nominee and agent, to act for and on behalf of such Lender or Affiliate
thereof in connection with the Collateral Documents and (ii) to be bound by the
terms of this Article IX.

         SECTION 9.02 DELEGATION OF DUTIES. Either the Administrative Agent or
the Collateral Agent may execute any of its duties under this Agreement or any
other Loan Document by or through agents, employees or attorneys-in-fact and
shall be entitled to advice of counsel and other consultants or experts
concerning all matters pertaining to such duties. Neither the Administrative
Agent nor the Collateral Agent shall be responsible for the negligence or
misconduct of any agent or attorney-in-fact that it selects in the absence of
gross negligence or willful misconduct.

         SECTION 9.03 DEFAULT; MASTER CONSENT TO ASSIGNMENT.

         (a) Upon the occurrence and continuance of a Default or Event of
Default, the Lenders agree to promptly confer in order that Required Lenders or
the Lenders, as the case may be, may agree upon a course of action for the
enforcement of the rights of the Lenders; and the Administrative Agent and the
Collateral Agent shall be entitled to refrain from taking any action (without
incurring any liability to any Person for so refraining) unless and until the
Administrative Agent or the Collateral Agent, as appropriate, shall have
received instructions from Required Lenders. All rights of action under the Loan
Documents and all right to the Collateral, if any, hereunder may be enforced by
the Administrative Agent and the Collateral Agent and any suit or proceeding
instituted by the Administrative Agent or the Collateral Agent in furtherance of
such enforcement shall be brought in its name as the Administrative Agent or the
Collateral Agent, as applicable, without the necessity of joining as plaintiffs
or defendants any other Lender, and the recovery of any judgment shall be for
the benefit of the Lenders (and, with respect to Lender Hedging Agreements,
Affiliates, if applicable) subject to the expenses of the Administrative Agent
and/or the Collateral Agent. In actions with respect to any property of the
Borrower or any other Obligor, each of the Administrative Agent and the
Collateral Agent is acting for the ratable benefit of each Lender (and, with
respect to Lender Hedging Agreement, Affiliates, if applicable). Any and all
agreements to subordinate (whether made heretofore or hereafter) other
indebtedness or obligations of Borrower to the Obligation shall be construed as
being for the ratable benefit of each Lender (and, with respect to Lender
Hedging Agreement, Affiliates, if applicable).



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         (b) Each Lender authorizes and directs the Administrative Agent and the
Collateral Agent to enter into the Collateral Documents on behalf of and for the
benefit of the Lenders (and, with respect to Lender Hedging Agreement,
Affiliates, if applicable).

         (c) Except to the extent unanimity (or other percentage set forth in
Section 10.1) is required hereunder, each Lender agrees that any action taken by
the Required Lenders in accordance with the provisions of the Loan Documents,
and the exercise by the Required Lenders of the power set forth herein or
therein, together with such other powers as are reasonably incidental thereto,
shall be authorized and binding upon all of the Lenders.

         (d) Each of the Administrative Agent and the Collateral Agent is hereby
authorized on behalf of the Lenders, without the necessity of any notice to or
further consent from any Lender, from time to time to take any action with
respect to any Collateral or Collateral Documents which may be necessary to
perfect and maintain perfected the Liens upon the Collateral granted pursuant to
the Collateral Documents.

         (e) Neither the Administrative Agent nor the Collateral Agent shall
have any obligation whatsoever to any Lender or to any other Person to assure
that the Collateral exists or is owned by any Obligor or is cared for,
protected, or insured or has been encumbered or that the Liens granted to the
Administrative Agent or the Collateral Agent herein or pursuant thereto have
been properly or sufficiently or lawfully created, perfected, protected, or
enforced, or are entitled to any particular priority, or to exercise at all or
in any particular manner or under any duty of care, disclosure, or fidelity, or
to continue exercising, any of the Rights granted or available to the
Administrative Agent or the Collateral Agent in this Section 9.03 or in any of
the Collateral Documents; it being understood and agreed that in respect of the
Collateral, or any act, omission, or event related thereto, the Administrative
Agent or the Collateral Agent may act in any manner it may deem appropriate, in
its sole discretion, given the Administrative Agent's or the Collateral Agent's
own interest in the Collateral as one of the Lenders and that neither the
Administrative Agent nor the Collateral Agent shall have any duty or liability
whatsoever to any Lender, other than to act without gross negligence or willful
misconduct.

         (f) The Lenders hereby irrevocably authorize each of the Administrative
Agent and the Collateral Agent, at its option and discretion, to release any
Lien granted to or held by the Administrative Agent or the Collateral Agent upon
any Collateral: (i) constituting property in which no Obligor owned an interest
at the time the Lien was granted or at any time thereafter; (ii) constituting
property leased to an Obligor under a lease which has expired or been terminated
in a transaction permitted under the Loan Document or is about to expire and
which has not been, and is not intended by such Obligor to be, renewed; and
(iii) consisting of an instrument evidencing Indebtedness pledged to the
Administrative Agent or the Collateral Agent (for the benefit of the Lenders),
if the Indebtedness evidenced thereby has been paid in full. In addition, the
Lenders irrevocably authorize the Administrative Agent and the Collateral Agent
to release Liens upon Collateral as contemplated in Section 10.01(c) or (d), or
if approved, authorized, or ratified in writing by the requisite Lenders. Upon
request by the Administrative Agent and/or the Collateral Agent at any time, the
Lenders will confirm in writing the Administrative Agent's and/or the Collateral
Agent's authority to release particular types or items of Collateral pursuant to
this Section 9.03.

         (g) In furtherance of the authorizations set forth in this Section
9.03, each Lender hereby irrevocably appoints each of the Administrative Agent
and the Collateral Agent its attorney-in-fact, with full power of substitution,
for and on behalf of and in the name of each such Lender, (i) to enter into
Collateral Documents (including, without limitation, any appointments of
substitute trustees under any Collateral Documents), (ii) to take action with
respect to the Collateral and Collateral Documents to perfect, maintain, and
preserve the Liens securing the Obligations, and (iii) to execute instruments of



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release or to take other action necessary to release Liens upon any Collateral
to the extent authorized in paragraph (f) hereof. This power of attorney shall
be liberally, not restrictively, construed so as to give the greatest latitude
to the Administrative Agent's and the Collateral Agent's power, as attorney,
relative to the Collateral matters described in this Section 9.03. The
respective powers and authorities herein conferred on the Administrative Agent
and the Collateral Agent may be exercised by each of the Administrative Agent
and/or the Collateral Agent through any Person who, at the time of the execution
of a particular instrument, is an officer of such agent. The power of attorney
conferred by this Section 9.03(g) is granted for valuable consideration and is
coupled with an interest and is irrevocable so long as the Obligations, or any
part thereof, shall remain unpaid or the Lenders are obligated to make any
Borrowings under the Loan Documents.

         SECTION 9.04 LIABILITY OF ADMINISTRATIVE AGENT. No Agent-Related Person
shall (a) be liable for any action taken or omitted to be taken by any of them
under or in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby (except for its own gross negligence or willful
misconduct in connection with its duties expressly set forth herein), or (b) be
responsible in any manner to any Lender or participant for any recital,
statement, representation or warranty made by any Loan Party or any officer
thereof, contained herein or in any other Loan Document, or in any certificate,
report, statement or other document referred to or provided for in, or received
by the Administrative Agent under or in connection with, this Agreement or any
other Loan Document, or the validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document, or for the
creation, perfection or priority of any Liens purported to be created by any of
the Loan Documents, or the validity, genuineness, enforceability, existence,
value or sufficiency of any collateral security, or to make any inquiry
respecting the performance by the Borrower of its obligations hereunder or under
any other Loan Document, or for any failure of any Loan Party or any other party
to any Loan Document to perform its obligations hereunder or thereunder. No
Agent-Related Person shall be under any obligation to any Lender or participant
to ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Loan Party or
any Affiliate thereof.

         SECTION 9.05 RELIANCE BY ADMINISTRATIVE AGENT.

         (a) Each of the Administrative Agent and the Collateral Agent shall be
entitled to rely, and shall be fully protected in relying, upon any writing,
communication, signature, resolution, representation, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone message,
statement or other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel to any Loan
Party), independent accountants and other experts selected by the Administrative
Agent or the Collateral Agent. Each of the Administrative Agent and the
Collateral Agent shall be fully justified in failing or refusing to take any
action under any Loan Document unless it shall first receive such advice or
concurrence of the Required Lenders as it deems appropriate and, if it so
requests, it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. Each of the Administrative
Agent and the Collateral Agent shall in all cases be fully protected in acting,
or in refraining from acting, under this Agreement or any other Loan Document in
accordance with a request or consent of the Required Lenders or all the Lenders,
if required hereunder, and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and participants. Where
this Agreement expressly permits or prohibits an action unless the Required
Lenders otherwise determine, the Administrative Agent and/or the Collateral
Agent shall, and in all other instances, the Administrative Agent and/or the
Collateral Agent may, but shall not be required to, initiate any solicitation
for the consent or a vote of the Lenders.



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         (b) For purposes of determining compliance with the conditions
specified in Section 4.01, each Lender that has funded its Pro Rata Share of the
Borrowing(s) on the Conditions Effective Date (or, if there is no Borrowing made
on such date, each Lender other than Lenders who gave written objection to the
Administrative Agent prior to such date) shall be deemed to have consented to,
approved or accepted or to be satisfied with, each document or other matter
either sent by the Administrative Agent to such Lender for consent, approval,
acceptance or satisfaction, or required hereunder to be consented to or approved
by or acceptable or satisfactory to a Lender.

         SECTION 9.06 NOTICE OF DEFAULT. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default or Event of
Default, except with respect to defaults in the payment of principal, interest
and fees required to be paid to the Administrative Agent for the account of the
Lenders, unless the Administrative Agent shall have received written notice from
a Lender or the Borrower referring to this Agreement, describing such Default or
Event of Default and stating that such notice is a "notice of default." The
Administrative Agent will notify the Lenders of its receipt of any such notice.
The Administrative Agent shall take such action with respect to such Default or
Event of Default as may be directed by the Required Lenders in accordance with
Article VIII; provided, however, that unless and until the Administrative Agent
has received any such direction, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable or in the best
interest of the Lenders.

         SECTION 9.07 CREDIT DECISION; DISCLOSURE OF INFORMATION BY
ADMINISTRATIVE AGENT. Each Lender acknowledges that no Agent-Related Person has
made any representation or warranty to it, and that no act by the Administrative
Agent or the Collateral Agent hereinafter taken, including any consent to and
acceptance of any assignment or review of the affairs of any Loan Party or any
Affiliate thereof, shall be deemed to constitute any representation or warranty
by any Agent-Related Person to any Lender as to any matter, including whether
Agent-Related Persons have disclosed material information in their possession.
Each Lender represents to the Administrative Agent and the Collateral Agent that
it has, independently and without reliance upon any Agent-Related Person and
based on such documents and information as it has deemed appropriate, made its
own appraisal of and investigation into the business, prospects, operations,
property, financial and other condition and creditworthiness of the Loan Parties
and their respective Subsidiaries, and all applicable bank or other regulatory
Laws relating to the transactions contemplated hereby, and made its own decision
to enter into this Agreement and to extend credit to the Borrower hereunder.
Each Lender also represents that it will, independently and without reliance
upon any Agent-Related Person and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigations as it deems necessary
to inform itself as to the business, prospects, operations, property, financial
and other condition and creditworthiness of the Borrower and the other Loan
Parties. Except for notices, reports and other documents expressly required to
be furnished to the Lenders by the Administrative Agent or the Collateral Agent
herein, neither the Administrative Agent nor the Collateral Agent shall have any
duty or responsibility to provide any Lender with any credit or other
information concerning the business, prospects, operations, property, financial
and other condition or creditworthiness of any of the Loan Parties or any of
their respective Affiliates which may come into the possession of any
Agent-Related Person.

         SECTION 9.08 INDEMNIFICATION OF ADMINISTRATIVE AGENT AND THE COLLATERAL
AGENT. Whether or not the transactions contemplated hereby are consummated, the
Lenders shall indemnify upon demand each Agent-Related Person (to the extent not
reimbursed by or on behalf of any Loan Party and without limiting the obligation
of any Loan Party to do so), pro rata, and hold harmless each Agent-Related
Person from and against any and all Indemnified Liabilities incurred by it;
provided, however, that no Lender shall be liable for the payment to any
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Liabilities resulting from such Person's gross negligence or willful misconduct;
provided, however, that no action taken in accordance with the directions of the
Required Lenders shall be deemed to constitute gross negligence or willful
misconduct for purposes of this Section. Without limitation of the foregoing,
each Lender shall reimburse each of the Administrative Agent and the Collateral
Agent upon demand for its ratable share of any costs or out-of-pocket expenses
(including Attorney Costs) incurred by each of the Administrative Agent and each
of the Collateral Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Agreement, any other Loan Document, or
any document contemplated by or referred to herein, to the extent that the
Administrative Agent and/or the Collateral Agent is not reimbursed for such
expenses by or on behalf of the Borrower. The undertaking in this Section shall
survive termination of the Commitments, the payment of all Obligations hereunder
and the resignation or replacement of the Administrative Agent and/or the
Collateral Agent.

         SECTION 9.09 ADMINISTRATIVE AGENT AND COLLATERAL AGENT IN THEIR
INDIVIDUAL CAPACITIES. Royal Bank and its Affiliates may make loans to, accept
deposits from, acquire equity interests in (any equity interests acquired shall
be held by a Royal Bank Affiliate) and generally engage in any kind of banking,
trust, financial advisory, underwriting or other business with each of the Loan
Parties and their respective Affiliates as though Royal Bank were not the
Administrative Agent, the Collateral Agent, or the L/C Issuer hereunder and
without notice to or consent of the Lenders. The Lenders acknowledge that,
pursuant to such activities, Royal Bank or its Affiliates may receive
information regarding any Loan Party or its Affiliates (including information
that may be subject to confidentiality obligations in favor of such Loan Party
or such Affiliate) and acknowledge that neither the Administrative Agent nor the
Collateral Agent shall be under no obligation to provide such information to
them. With respect to its Loans, Royal Bank shall have the same rights and
powers under this Agreement as any other Lender and may exercise such rights and
powers as though it were not the Administrative Agent, the Collateral Agent, or
the L/C Issuer, and the terms "Lender" and "Lenders" include Royal Bank in its
individual capacity.

         SECTION 9.10 SUCCESSOR AGENTS.

         (a) The Administrative Agent may resign as Administrative Agent upon 30
days' notice to the Lenders with a copy of such notice to the Borrower. If the
Administrative Agent resigns under this Agreement, the Required Lenders shall
appoint from among the Lenders a successor administrative agent for the Lenders
which successor administrative agent shall be consented to by the Borrower at
all times other than during the existence of an Event of Default. If no
successor administrative agent is appointed prior to the effective date of the
resignation of the Administrative Agent, the Administrative Agent may appoint,
after consulting with the Lenders and the Borrower, a successor administrative
agent from among the Lenders. Upon the acceptance of its appointment as
successor administrative agent hereunder, such successor administrative agent
shall succeed to all the rights, powers and duties of the retiring
Administrative Agent and the term "Administrative Agent" shall mean such
successor administrative agent and the retiring Administrative Agent's
appointment, powers and duties as Administrative Agent shall be terminated.
After any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this Article IX and Sections 10.03 and
10.13 shall inure to its benefit as to any actions taken or omitted to be taken
by it while it was Administrative Agent under this Agreement. If no successor
administrative agent has accepted appointment as Administrative Agent by the
date which is thirty (30) days following a retiring Administrative Agent's
notice of resignation, the retiring Administrative Agent's resignation shall
nevertheless thereupon become effective and the Lenders shall perform all of the
duties of the Administrative Agent hereunder until such time, if any, as the
Required Lenders appoint a successor agent as provided for above.



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         (b) The Collateral Agent may resign as Collateral Agent upon 30 days'
notice to the Lenders with a copy of such notice to the Borrower. If the
Collateral Agent resigns under this Agreement, the Required Lenders shall
appoint from among the Lenders a successor collateral agent for the Lenders
which successor collateral agent shall be consented to by the Borrower at all
times other than during the existence of an Event of Default. If no successor
collateral agent is appointed prior to the effective date of the resignation of
the Collateral Agent, the Collateral Agent may appoint, after consulting with
the Lenders and the Borrower, a successor collateral agent from among the
Lenders. Upon the acceptance of its appointment as successor collateral agent
hereunder, such successor collateral agent shall succeed to all the rights,
powers and duties of the retiring Collateral Agent and the term "Collateral
Agent" shall mean such successor collateral agent and the retiring Collateral
Agent's appointment, powers and duties as Collateral Agent shall be terminated.
After any retiring Collateral Agent's resignation hereunder as Collateral Agent,
the provisions of this Article IX and Sections 10.03 and 10.13 shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was
Collateral Agent under this Agreement. If no successor collateral agent has
accepted appointment as Collateral Agent by the date which is thirty (30) days
following a retiring Collateral Agent's notice of resignation, the retiring
Collateral Agent's resignation shall nevertheless thereupon become effective and
the Lenders shall perform all of the duties of the Collateral Agent hereunder
until such time, if any, as the Required Lenders appoint a successor agent as
provided for above.

         (c) If the Collateral Agent deems it necessary or advisable to appoint
a substitute Collateral Agent that qualifies as citizen of the United States
under Section 2 of the Shipping Act of 1916, as amended and then in effect, then
the Collateral Agent shall appoint a substitute Collateral Agent. Each Lender
that qualifies to serve as Collateral Agent pursuant to this Section 9.12 agrees
to accept appointment as Collateral Agent.

         SECTION 9.11 OTHER AGENTS; LEAD MANAGERS. None of the Lenders or other
Persons identified on the facing page or signature pages of this Agreement as a
"co-agent," any other type of agent (other than the Administrative Agent and the
Collateral Agent), "lead arranger," or "book runner" shall have any right,
power, obligation, liability, responsibility or duty under this Agreement other
than those applicable to all Lenders as such. Without limiting the foregoing,
none of the Lenders so identified shall have or be deemed to have any fiduciary
relationship with any Lender. Each Lender acknowledges that it has not relied,
and will not rely, on any of the Lenders so identified in deciding to enter into
this Agreement or in taking or not taking action hereunder.

                                   ARTICLE X.
                                  MISCELLANEOUS

         SECTION 10.01 AMENDMENTS, RELEASE OF COLLATERAL, ETC.

         (a) No amendment or waiver of any provision of this Agreement or any
other Loan Document, and no consent to any departure by the Borrower or any
other Loan Party therefrom, shall be effective unless in writing signed by the
Required Lenders and the Borrower or the applicable Loan Party, as the case may
be, and acknowledged by the Administrative Agent, and each such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that no such amendment, waiver or
consent shall, unless in writing and signed by each of the Lenders directly
affected thereby and by the Borrower, and acknowledged by the Administrative
Agent, do any of the following:

                  (i) extend or increase the Commitment of any Lender (or
         reinstate any Commitment terminated pursuant to Section 8.02);



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                  (ii) postpone any date fixed by this Agreement or any other
         Loan Document for any payment or mandatory prepayment of principal,
         interest, fees or other amounts due to the Lenders (or any of them)
         hereunder or under any other Loan Document;

                  (iii) reduce the principal of, or the rate of interest
         specified herein on, any Loan or L/C Borrowing or (subject to clause
         (ii) of the proviso below) any fees or other amounts payable hereunder
         or under any other Loan Document, provided, however, that only the
         consent of the Required Lenders shall be necessary to amend the
         definition of "Default Rate" or to waive any obligation of the Borrower
         to pay interest at the Default Rate;

                  (iv) change the percentage of the Aggregate Commitments or of
         the aggregate unpaid principal amount of the Loans and L/C Obligations
         which is required for the Lenders or any of them to take any action
         hereunder;

                  (v) change the Pro Rata Share of any Lender;

                  (vi) Release a material amount of Collateral or release any
         Guarantor from a Guaranty (except as otherwise permitted under this
         Section 10.01);

                  (vii) amend this Section, or Section 2.12, or any provision
         herein providing for unanimous consent or other action by all the
         Lenders; or

                  (viii) change the allocation of payments between the Revolver
         Facility and the Term Loan Facility.

and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Required Lenders or all
the Lenders, as the case may be, affect the rights or duties of the L/C Issuer
under this Agreement or any Letter of Credit Application relating to any Letter
of Credit issued or to be issued by it; (ii) no amendment, waiver or consent
shall, unless in writing and signed by the Administrative Agent in addition to
the Required Lenders or all the Lenders, as the case may be, affect the rights
or duties of the Administrative Agent under this Agreement or any other Loan
Document; (iii) the Agent/Arranger Fee Letter may be amended, or rights or
privileges thereunder waived, in a writing executed only by the parties thereto.
Notwithstanding anything to the contrary herein, any Lender that has failed to
fund any portion of the Loans or participation in L/C Obligations required to be
funded by it hereunder shall not have any right to approve or disapprove any
amendment, waiver or consent hereunder, except that the Pro Rata Share of such
Lender may not be increased without the consent of such Lender, and (iv) no
amendment, waiver, or consent shall, unless in writing and signed by the Swing
Line Lender in addition to the Lenders required above, affect the rights or
duties of the Swing Line Lender under this Agreement.

         (b) Any amendment to any Loan Document which purports to (i) decrease
the amount of any mandatory prepayment or commitment reduction required by
Section 2.04 or (ii) change this Section 10.01(b), must be by an instrument in
writing executed by Borrower, the Administrative Agent, the Required Revolver
Lenders, and the Required Term Lenders.

         (c) Upon any sale, transfer, or disposition of Collateral which is
permitted pursuant to the Loan Documents, and upon ten (10) Business Days' prior
written request by the Borrower (which request must be accompanied by (i) true
and correct copies of all material documents of transfer or disposition,
including any contract of sale, (ii) a preliminary closing statement and
instructions to the title company, if any, (iii) all requested release
instruments in form and substance satisfactory to the Administrative Agent) and
(iv) if required, written consent of the requisite Lenders, the Administrative
Agent (or the Collateral




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Agent, as applicable) shall (and is hereby irrevocably authorized by the Lenders
to) execute such documents as may be necessary to evidence the release of Liens
granted to the Collateral Agent for the benefit of the Lenders pursuant hereto
in such Collateral. Neither the Administrative Agent nor the Collateral Agent
shall be required to execute any release instruments on terms which, in the
Administrative Agent's or the Collateral Agent's opinion, would expose the
Administrative Agent or the Collateral Agent to liability or create any
obligation or entail any consequence other than the release of liens without
recourse or warranty. No such release shall impair the Administrative Agent's or
the Collateral Agent's lien on the proceeds of sale of such Collateral.

         (d) If all outstanding Loans and other Obligations have been
indefeasibly paid in full and the Commitments have terminated or have been
reduced to zero, and, subject to Section 10.01(e) all Lender Hedging Agreement
have terminated, each of the Administrative Agent and the Collateral Agent
agrees to, and the Lenders hereby instruct the Administrative Agent or the
Collateral Agent, as applicable, to, at the Borrower's expense, execute such
releases of the Collateral Documents as the Borrower shall reasonably request
and this Agreement shall be deemed terminated except that such termination shall
not relieve the Borrower of any obligation to make any payments to the
Administrative Agent, the Collateral Agent, or any Lender required by any Loan
Document to the extent accruing, or relating to an event occurring, prior to
such termination.

         (e) Notwithstanding any provision herein to the contrary, if the
Commitments have been terminated, and the only outstanding Obligations are
amounts owed pursuant to one or more Lender Hedging Agreements, the
Administrative Agent or the Collateral Agent, as applicable, will, and is hereby
authorized to, (A) release the Liens created under the Loan Documents and (B)
release all Guaranties of the Borrower, provided, that contemporaneously with
such release, (i) the Borrower (and, if applicable, the Subsidiary that is a
party to such Lender Hedging Agreements) (A) executes a margin agreement in form
and substance acceptable to such Lender(s) (or its Affiliates) that are parties
to such Lender Hedging Agreements (the "Lender Counterparties") and (B), if
required, provides collateral in the form of cash or a letter of credit having
an aggregate value acceptable to such Lender Counterparties, and (ii) if such
Lender Hedging Agreement is executed by a Subsidiary of the Borrower and the
Borrower and the MLP are not parties thereto, the Borrower and the MLP execute a
guaranty covering such Subsidiary's obligations thereunder, such guaranty to be
in form and substance satisfactory to the Lender Counterparties. Any release
under this Section 10.01(e) must be in writing and signed by the Administrative
Agent.

         SECTION 10.02 NOTICES AND OTHER COMMUNICATIONS; FACSIMILE COPIES.

         (a) General. Unless otherwise expressly provided herein, all notices
and other communications provided for hereunder and under the other Loan
Documents shall be in writing (including by facsimile transmission) and mailed,
faxed or delivered, to the address, facsimile number or (subject to subsection
(c) below) electronic mail address specified for notices on Schedule 10.02 (for
the Borrower, any Guarantor, the Administrative Agent, and the Collateral Agent)
or on the Administrative Questionnaire (for the other Lenders); or, in the case
of the Borrower, the Guarantors, the Administrative Agent, the Collateral Agent,
the Swing Line Lender, or the L/C Issuer, to such other address as shall be
designated by such party in a notice to the other parties, and in the case of
any other party, to such other address as shall be designated by such party in a
notice to the Borrower, the Administrative Agent, the Collateral Agent, the
Swing Line Lender, and the L/C Issuer. All such notices and other communications
shall be deemed to be given or made upon the earlier to occur of (i) actual
receipt by the intended recipient and (ii) (A) if delivered by hand or by
courier, when signed for by the intended recipient; (B) if delivered by mail,
four Business Days after deposit in the mails, postage prepaid; (C) if delivered
by facsimile, when sent and receipt has been confirmed by telephone; and (D) if
delivered by electronic mail (which form of delivery is subject to the
provisions of subsection (c) below), when delivered; provided,


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however, that notices and other communications to the Administrative Agent or
the L/C Issuer pursuant to Article II shall not be effective until actually
received by such Person. Any notice or other communication permitted to be
given, made or confirmed by telephone hereunder shall be given, made or
confirmed by means of a telephone call to the intended recipient at the number
specified in accordance with this Section, it being understood and agreed that a
voicemail message shall in no event be effective as a notice, communication or
confirmation hereunder.

         (b) Effectiveness of Facsimile Documents and Signatures. Loan Documents
may be transmitted and/or signed by facsimile. The effectiveness of any such
documents and signatures shall, subject to applicable Law, have the same force
and effect as manually-signed originals and shall be binding on all Loan
Parties, the Administrative Agent, the Collateral Agent, and the Lenders. The
Administrative Agent may also require that any such documents and signatures be
confirmed by a manually-signed original thereof; provided, however, that the
failure to request or deliver the same shall not limit the effectiveness of any
facsimile document or signature.

         (c) Limited Use of Electronic Mail. Electronic mail and internet and
intranet websites may be used only to distribute routine communications, such as
financial statements and other information, and to distribute Loan Documents for
execution by the parties thereto, and shall not be recognized hereunder for any
other purpose.

         (d) Reliance by Administrative Agent and Lenders. The Administrative
Agent and the Lenders shall be entitled to rely and act upon any notices
(including telephonic Committed Loan Notices and Swing Line Notices) purportedly
given by or on behalf of the Borrower even if (i) such notices were not made in
a manner specified herein, were incomplete or were not preceded or followed by
any other form of notice specified herein, or (ii) the terms thereof, as
understood by the recipient, varied from any confirmation thereof. The Borrower
shall indemnify each Agent-Related Person and each Lender from all losses,
costs, expenses and liabilities resulting from the reliance by such Person on
each notice purportedly given by or on behalf of the Borrower. All telephonic
notices to and other communications with the Administrative Agent may be
recorded by the Administrative Agent, and each of the parties hereto hereby
consents to such recording.

         SECTION 10.03 NO WAIVER; CUMULATIVE REMEDIES. No failure by any Lender,
the Administrative Agent, or the Collateral Agent to exercise, and no delay by
any such Person in exercising, any right, remedy, power or privilege hereunder
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein or therein provided are
cumulative and not exclusive of any rights, remedies, powers and privileges
provided by law.

         SECTION 10.04 ATTORNEY COSTS; EXPENSES AND TAXES. The Borrower agrees
(a) to pay or reimburse the Administrative Agent and the Collateral Agent for
all costs and expenses incurred in connection with the development, preparation,
negotiation, syndication, administration and execution of this Agreement and the
other Loan Documents, including the filing, recording, refiling or rerecording
of any Mortgage, any pledge agreement and any Security Agreement and/or any
Uniform Commercial Code financing statements relating thereto and all
amendments, supplements and modifications to any thereof and any and all other
documents or instruments of further assurance required to be filed or recorded
or refiled or rerecorded by the terms hereof or of any mortgage, any pledge
agreement or any security agreement, and any amendment, waiver, consent or other
modification of the provisions hereof and thereof (whether or not the
transactions contemplated hereby or thereby are consummated), and the
consummation and administration of the transactions contemplated hereby and
thereby, including all Attorney Costs, and (b) to pay or reimburse the
Administrative Agent, the Collateral Agent, and each



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Lender for all costs and expenses incurred in connection with the enforcement,
attempted enforcement, or preservation of any rights or remedies under this
Agreement or the other Loan Documents (including all such costs and expenses
incurred during any workout or restructuring in respect of the Obligations and
during any legal proceeding, including any proceeding under any Debtor Relief
Law), including all Attorney Costs. The foregoing costs and expenses shall
include all search, filing, recording, title insurance and appraisal charges and
fees and taxes related thereto, and other out-of-pocket expenses incurred by the
Administrative Agent, the Collateral Agent, and the cost of independent public
accountants and other outside experts retained by the Administrative Agent, the
Collateral Agent, or any Lender. The agreements in this Section shall survive
the termination of the Commitments and repayment of all the other Obligations.

         SECTION 10.05 INDEMNIFICATION. Whether or not the transactions
contemplated hereby are consummated, each of the Borrower, the MLP, and each
other Guarantor (by execution of a Guaranty), jointly and severally, agrees to
indemnify, save and hold harmless each Agent-Related Person, each Co-Agent
Related Person, each Arranger, each Lender, the Swing Line Lender, the L/C
Issuer and their respective Affiliates, directors, officers, employees, counsel,
agents and attorneys-in-fact (collectively the "Indemnitees") from and against:
(a) any and all claims, demands, actions or causes of action that are asserted
against any Indemnitee by any Person (other than the Administrative Agent, Swing
Line Lender, or any Lender) relating directly or indirectly to a claim, demand,
action or cause of action that such Person asserts or may assert against any
Loan Party, any Affiliate of any Loan Party or any of their respective officers
or directors, arising out of or relating to, the Loan Documents, the
Commitments, the use or contemplated use of the proceeds of any Loans, or the
relationship of any Loan Party, the Administrative Agent, the Lenders, the Swing
Line Lender, and the L/C Issuer under this Agreement or any other Loan Document;
(b) any and all claims, demands, actions or causes of action that may at any
time (including at any time following repayment of the Obligations and the
resignation of the Administrative Agent, Swing Line Lender, or the replacement
of any Lender) be asserted or imposed against any Indemnitee, arising out of or
relating to, the Loan Documents, the Commitments, the use or contemplated use of
the proceeds of any Loans, or the relationship of any Loan Party, the
Administrative Agent, the Lenders, the Swing Line Lender, and the L/C Issuer
under this Agreement or any other Loan Document; (c) without limiting the
foregoing, any and all claims, demands, actions or causes of action, judgments
and orders, penalties and fines that are asserted or imposed against any
Indemnitee, (i) under the application of any Environmental Law applicable to the
Borrower or any of its Subsidiaries or any of their properties or assets,
including the treatment or disposal of Hazardous Substances on any of their
properties or assets, (ii) as a result of the breach or non-compliance by the
Borrower or any Subsidiary with any Environmental Law applicable to the Borrower
or any Subsidiary, (iii) due to past ownership by the Borrower or any Subsidiary
of any of their properties or assets or past activity on any of their properties
or assets which, though lawful and fully permissible at the time, could result
in present liability, (iv) due to the presence, use, storage, treatment or
disposal of Hazardous Substances on or under, or the escape, seepage, leakage,
spillage, discharge, emission or Release from, any of the properties owned or
operated by the Borrower or any Subsidiary (including any liability asserted or
arising under any Environmental Law), regardless of whether caused by, or within
the control of, the Borrower or such Subsidiary, or (v) due to any other
environmental, health or safety condition in connection with the Loan Documents;
(d) any administrative or investigative proceeding by any Governmental Authority
arising out of or related to a claim, demand, action or cause of action
described in subsection (a), (b) or (c) above; and (e) any and all liabilities
(including liabilities under indemnities), losses, costs or expenses (including
Attorney Costs and settlement costs) that any Indemnitee suffers or incurs as a
result of the assertion of any foregoing claim, demand, action, cause of action
or proceeding, or as a result of the preparation of any defense in connection
with any foregoing claim, demand, action, cause of action or proceeding, in all
cases, WHETHER OR NOT ARISING OUT OF THE STRICT LIABILITY OR NEGLIGENCE OF AN
INDEMNITEE, and whether or not an Indemnitee is a party to such claim, demand,
action, cause of action or proceeding (all the foregoing, collectively, the
"Indemnified Liabilities"); provided that no



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Indemnitee shall be entitled to indemnification for any claim to the extent
caused by its own gross negligence or willful misconduct. The agreements in this
Section shall survive and continue for the benefit of the indemnitees at all
times after the Borrower's acceptance of the Lenders' commitments for the Senior
Credit Facility, whether or not the Conditions Effective Date shall occur and
shall survive the termination of the Commitments and repayment of all the other
Obligations.

         SECTION 10.06 PAYMENTS SET ASIDE. To the extent that the Borrower makes
a payment to the Administrative Agent or any Lender, or the Administrative Agent
or any Lender exercises its right of set-off, and such payment or the proceeds
of such set-off or any part thereof is subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by the Administrative Agent or such Lender in its
discretion) to be repaid to a trustee, receiver or any other party, in
connection with any proceeding under any Debtor Relief Law or otherwise, then
(a) to the extent of such recovery, the obligation or part thereof originally
intended to be satisfied shall be revived and continued in full force and effect
as if such payment had not been made or such set-off had not occurred, and (b)
each Lender severally agrees to pay to the Administrative Agent upon demand its
applicable share of any amount so recovered from or repaid by the Administrative
Agent, plus interest thereon from the date of such demand to the date such
payment is made at a rate per annum equal to the Federal Funds Rate from time to
time in effect.

         SECTION 10.07 SUCCESSORS AND ASSIGNS.

         (a) The provisions of this Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that neither the Borrower nor the MLP may assign or
otherwise transfer any of its rights or obligations hereunder without the prior
written consent of each Lender and no Lender may assign or otherwise transfer
any of its rights or obligations hereunder except (i) to an Eligible Assignee in
accordance with the provisions of paragraph (b) of this Section, (ii) by way of
participation in accordance with the provisions of paragraph (d) of this Section
or (iii) by way of pledge or assignment of a security interest subject to the
restrictions of paragraph (f) of this Section (and any other attempted
assignment or transfer by any party hereto shall be null and void). Nothing in
this Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, their respective successors and assigns
permitted hereby, Participants to the extent provided in paragraph (d) of this
Section and, to the extent expressly contemplated hereby, the Related Parties of
each of the Administrative Agent and the Lenders) any legal or equitable right,
remedy or claim under or by reason of this Agreement.

         (b) Any Lender may at any time assign to one or more Eligible Assignees
all or a portion of its rights and obligations under this Agreement (including
all or a portion of its Commitment and the Loans (including for purposes of this
subsection (b), participations in L/C Obligations and in Swing Line Loans) at
the time owing to it); provided that (i) except in the case of an assignment of
the entire remaining amount of the assigning Lender's Commitment and the Loans
at the time owing to it or in the case of an assignment to a Lender or an
Affiliate of a Lender or an Approved Fund with respect to a Lender, the
aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) or, if the applicable Commitment is not then in effect,
the outstanding principal balance of the Loans of the assigning Lender subject
to each such assignment (determined as of the date the Assignment and Assumption
with respect to such assignment is delivered to the Administrative Agent or, if
"Trade Date" is specified in the Assignment and Assumption, as of the Trade
Date) shall not be less than $5,000,000, in the case of any assignment in
respect of a Loan under the Revolver Facility, or $1,000,000, in the case of any
assignment of a Loan under the Term Loan Facility, unless each of the
Administrative Agent and, so long as no Default or Event of Default has occurred
and is continuing, the Borrower otherwise consent (each such consent not to be
unreasonably withheld or delayed); (ii) each partial assignment shall be made as
an assignment of a proportionate part of all the assigning Lender's rights and



                                       88
<PAGE>



obligations under this Agreement with respect to the Loans or the Commitment
assigned except that this clause (ii) shall not prohibit the assignment of a
proportionate part of the assigning Lender's rights and obligations in respect
of either the Revolver Facility or the Term Loan Facility (i.e. an assignment
need not be ratable as between the Revolver Facility and the Term Loan Facility,
but assignments of the Revolver Facility shall be ratable as between the
Acquisition Subfacility and the Working Capital/Distribution Subfacility) and
shall not apply to rights in respect of Swing Line Loans, (iii) any assignment
of a Revolver Commitment must be approved by the Administrative Agent and the
L/C Issuer unless the Person that is the proposed assignee is itself a Lender
with a Revolver Commitment (whether or not the proposed assignee would otherwise
qualify as an Eligible Assignee); and (iv) the parties to each assignment shall
execute and deliver to the Administrative Agent an Assignment and Assumption,
together with a processing and recordation fee of $3,500, and the Eligible
Assignee, if it shall not be a Lender, shall deliver to the Administrative Agent
an Administrative Questionnaire. Subject to acceptance and recording thereof by
the Administrative Agent pursuant to paragraph (c) of this Section, from and
after the effective date specified in each Assignment and Assumption, the
Eligible Assignee thereunder shall be a party to this Agreement and, to the
extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this Agreement
(and, in the case of an Assignment and Assumption covering all of the assigning
Lender's rights and obligations under this Agreement, such Lender shall cease to
be a party hereto) but shall continue to be entitled to the benefits of Sections
3.07, 10.04 and 10.05 with respect to facts and circumstances occurring prior to
the effective date of such assignment. Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
paragraph shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
paragraph (d) of this Section.

         (c) The Administrative Agent, acting solely for this purpose as an
agent of the Borrower, shall maintain at one of its offices a copy of each
Assignment and Assumption delivered to it and a register for the recordation of
the names and addresses of the Lenders, and the Commitments of, and principal
amounts of the Loans and L/C Obligations owing to, each Lender pursuant to the
terms hereof from time to time (the "Register"). The entries in the Register
shall be conclusive absent manifest error, and the Borrower, the Administrative
Agent and the Lenders may treat each Person whose name is recorded in the
Register pursuant to the terms hereof as a Lender hereunder for all purposes of
this Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower and any Lender, at any reasonable time
and from time to time upon reasonable prior notice.

         (d) Any Lender may at any time, without the consent of, or notice to,
the Borrower or the Administrative Agent, sell participations to any Person
(other than a natural person or the Borrower or any of the Borrower's Affiliates
or Subsidiaries) (each, a "Participant") in all or a portion of such Lender's
rights and/or obligations under this Agreement (including all or a portion of
its Commitment and/or the Loans (including such Lender's participation in L/C
Obligations and/or Swing Line Loans) owing to it); provided that (i) such
Lender's obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) the Borrower, the Administrative Agent
and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement. Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, modification or waiver that would (i) postpone any date upon
which any payment of money is scheduled to be paid to such Participant, (ii)
reduce the principal, interest, fees or other amounts payable to such
Participant, or (iii) release the MLP from its Guaranty. Subject to subsection
(e) of this



                                       89
<PAGE>



Section, the Borrower agrees that each Participant shall be entitled to the
benefits of Sections 3.01, 3.04 and 3.05 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to subsection (b) of
this Section. To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 10.09 as though it were a Lender, provided
such Participant agrees to be subject to Section 2.12 as though it were a
Lender.

         (e) A Participant shall not be entitled to receive any greater payment
under Section 3.01 or 3.04 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Borrower's
prior written consent. A Participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of Section 3.01 unless the Borrower
is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with Section 10.15 as though
it were a Lender.

         (f) Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement (including under its
Notes, if any) to secure obligations of such Lender, including any pledge or
assignment to secure obligations to a Federal Reserve Bank; provided that no
such pledge or assignment shall release a Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.

         (g) If the consent of the Borrower to an assignment or to an Eligible
Assignee is required hereunder (including a consent to an assignment which does
not meet the minimum assignment threshold specified in clause (i) of the proviso
to the first sentence of Section 10.07(b)), the Borrower shall be deemed to have
given its consent five Business Days after the date notice thereof has been
delivered by the assigning Lender (through the Administrative Agent) unless such
consent is expressly refused by the Borrower prior to such fifth Business Day.

         (h) Notwithstanding anything to the contrary contained herein, if at
any time Royal Bank assigns all of its Commitment and Loans pursuant to
subsection (b) above, Royal Bank may, (i) upon 30 days' notice to the Borrower
and the Lenders, resign as L/C Issuer and/or (ii) upon 30 days' notice to the
Borrower, resign as Swing Line Lender. In the event of any such resignation as
L/C Issuer or Swing Line Lender, the Borrower shall be entitled to appoint from
among the Lenders a successor L/C Issuer or Swing Line Lender hereunder;
provided, however, that no failure by the Borrower to appoint any such successor
shall affect the resignation of Royal Bank as L/C Issuer or Swing Line Lender.
Royal Bank shall retain all the rights and obligations of the L/C Issuer
hereunder with respect to all Letters of Credit outstanding as of the effective
date of its resignation as L/C Issuer and all L/C Obligations with respect
thereto (including the right to require the Lenders to make Base Rate Loans or
fund participations in Unreimbursed Amounts pursuant to Section 2.14(c)). If
Royal Bank resigns as Swing Line Lender, it shall retain all the rights of the
Swing Line Lender provided for hereunder with respect to Swing Line Loans made
by it and outstanding as of the effective date of such resignation, including
the right to require the Lenders to make Base Rate Committed Loans or fund risk
participations in outstanding Swing Line Loans pursuant to Section 2.04(c).

         SECTION 10.08 CONFIDENTIALITY. Each Lender agrees that it will not
disclose without the prior consent of the Borrower (other than to directors,
officers, employees, auditors, accountants, counsel or other professional
advisors of the Administrative Agent, the Collateral Agent, or any Lender) any
information with respect to the MLP, the Borrower or its Subsidiaries, which is
furnished pursuant to this Agreement or the transactions contemplated hereby,
provided that any Lender may disclose any such information (a) (i) as has become
generally available to the public other than as a result of a breach of this
Section 10.08, (ii) was or becomes available to Royal Bank on a nonconfidential
basis prior to its disclosure pursuant hereto or (iii) is obtained by Royal Bank
on a non-confidential basis from a source



                                       90
<PAGE>



other than the Borrower provided that such source is not known to Royal Bank to
be subject to an obligation of confidentiality with respect to such information,
(b) as may be required in any report, statement or testimony submitted to or
required by any municipal, state or federal regulatory body having or claiming
to have jurisdiction over such Lender or submitted to or required by the Board
or the Federal Deposit Insurance Corporation or similar organizations (whether
in the United States of America or elsewhere) or their successors, (c) as may be
required in response to any summons or subpoena in connection with any
litigation, (d) in order to comply with any law, order, regulation or ruling
applicable to such Lender, (e) to any Eligible Assignee of or Participant in, or
any prospective Eligible Assignee of or Participant in, any of its rights or
obligations under this Agreement, provided that such Eligible Assignee or
Participant or prospective Eligible Assignee or Participant executes an
agreement containing provisions substantially the same as those contained in
this Section 10.08, (f) in connection with the exercise of any remedy by such
Lender following an Event of Default pertaining to the Loan Documents, (g) in
connection with any litigation involving such Lender pertaining to the Loan
Documents, (h) to any Lender or the Administrative Agent, or (i) to any
Affiliate (other than any Affiliate of any Lender that is a broker dealer) of
any Lender who is involved with the transactions contemplated hereby (it being
understood that the Persons to whom such disclosure is made will be informed of
the confidential nature of such information and obligated to keep such
information confidential on the same terms as set forth in this Section 10.08).

         SECTION 10.09 SET-OFF. In addition to any rights and remedies of the
Lenders provided by law, upon the occurrence and during the continuance of any
Event of Default, each Lender is authorized at any time and from time to time,
without prior notice to the Borrower or any other Loan Party, any such notice
being waived by the Borrower (on its own behalf and on behalf of each Loan
Party) to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held by, and other indebtedness at any time owing by, such Lender to or for the
credit or the account of the respective Loan Parties against any and all
Obligations owing to the Administrative Agent and the Lenders, now or hereafter
existing, irrespective of whether or not the Administrative Agent or such Lender
shall have made demand under this Agreement or any other Loan Document and
although such Obligations may be contingent or unmatured. Each Lender agrees
promptly to notify the Borrower and the Administrative Agent after any such
set-off and application made by such Lender; provided, however, that the failure
to give such notice shall not affect the validity of such set-off and
application.

         SECTION 10.10 INTEREST RATE LIMITATION. It is the intention of the
parties hereto to comply with applicable usury laws; accordingly,
notwithstanding any provision to the contrary in this Agreement or in any of the
other Loan Documents securing the payment hereof or otherwise relating hereto,
in no event shall this Agreement or such other Loan Documents require the
payment or permit the payment, taking, reserving, receiving, collection, or
charging of any sums constituting interest under applicable laws, if any, which
exceed the maximum amount permitted by such laws. If any such excess interest is
called for, contracted for, charged, taken, reserved, or received in connection
with the Loans or in any of the Loan Documents securing the payment thereof or
otherwise relating thereto, or in any communication by the Administrative Agent
or the Lenders or any other person to the Borrower or any other Person, or in
the event all or part of the principal or interest thereof shall be prepaid or
accelerated, so that under any of such circumstances or under any other
circumstance whatsoever the amount of interest contracted for, charged, taken,
reserved, or received on the amount of principal actually outstanding from time
to time pursuant to the Agreement shall exceed the maximum amount of interest
permitted by applicable usury laws, then in any such event it is agreed as
follows: (i) the provisions of this paragraph shall govern and control, (ii)
neither the Borrower nor any other Person or entity now or hereafter liable for
the payment of the Obligations shall be obligated to pay the amount of such
interest to the extent such interest is in excess of the maximum amount of
interest permitted by applicable usury laws, (iii) any such excess which is or
has been received notwithstanding this paragraph shall be credited against the
then unpaid principal



                                       91
<PAGE>



balance hereunder or, if the Loans have been or would be paid in full, refunded
to the Borrower, and (iv) the provisions of this Agreement and the other Loan
Documents securing the payment hereof and otherwise relating hereto, and any
communication to the Borrower, shall immediately be deemed reformed and such
excess interest reduced, without the necessity of executing any other document,
to the maximum lawful rate allowed under applicable laws as now or hereafter
construed by courts having jurisdiction hereof or thereof. Without limiting the
foregoing, all calculations of the rate of the interest contracted for, charged,
taken, reserved, or received in connection with the Loans or this Agreement
which are made for the purpose of determining whether such rate exceeds the
maximum lawful rate shall be made to the extent permitted by applicable laws by
amortizing, prorating, allocating and spreading during the period of the full
term of the Loans, including all prior and subsequent renewals and extensions,
all interest at any time contracted for, charged, taken, reserved, or received.
The terms of this paragraph shall be deemed to be incorporated in every document
and communication relating to the Loans or any other Loan Document.

         SECTION 10.11 COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

         SECTION 10.12 INTEGRATION. This Agreement, together with the other Loan
Documents, comprises the complete and integrated agreement of the parties on the
subject matter hereof and thereof and supersedes all prior agreements, written
or oral, on such subject matter. In the event of any conflict between the
provisions of this Agreement and those of any other Loan Document, the
provisions of this Agreement shall control; provided that the inclusion of
supplemental rights or remedies in favor of the Administrative Agent or the
Lenders in any other Loan Document shall not be deemed a conflict with this
Agreement. Each Loan Document was drafted with the joint participation of the
respective parties thereto and shall be construed neither against nor in favor
of any party, but rather in accordance with the fair meaning thereof.

         SECTION 10.13 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties made hereunder and in any other Loan Document or
other document delivered pursuant hereto or thereto or in connection herewith or
therewith shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by the
Administrative Agent, the Collateral Agent, and each Lender, regardless of any
investigation made by the Administrative Agent, the Collateral Agent, or any
Lender or on their behalf and notwithstanding that the Administrative Agent, the
Collateral Agent, or any Lender may have had notice or knowledge of any Default
or Event of Default at the time of any Borrowing, and shall continue in full
force and effect as long as any Loan or any other Obligation shall remain unpaid
or unsatisfied.

         SECTION 10.14 SEVERABILITY. Any provision of this Agreement and the
other Loan Documents to which the Borrower is a party that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions thereof, and any such prohibition or unenforceability in
any jurisdiction shall not invalidate or render unenforceable such provision in
any other jurisdiction.

         SECTION 10.15 FOREIGN LENDERS. Each Lender that is a "foreign
corporation, partnership or trust" within the meaning of the Code (a "Foreign
Lender") shall deliver to the Administrative Agent, prior to receipt of any
payment subject to withholding under the Code (or after accepting an assignment
of an interest herein), two duly signed completed copies of either IRS Form
W-8BEN or any successor thereto (relating to such Person and entitling it to an
exemption from, or reduction of, withholding tax on all payments to be made to
such Person by the Borrower pursuant to this Agreement) or IRS Form W-8ECI or
any successor thereto (relating to all payments to be made to such Person by the
Borrower



                                       92
<PAGE>



pursuant to this Agreement) or such other evidence satisfactory to the Borrower
and the Administrative Agent that such Person is entitled to an exemption from,
or reduction of, U.S. withholding tax. Thereafter and from time to time, each
such Person shall (a) promptly submit to the Administrative Agent such
additional duly completed and signed copies of one of such forms (or such
successor forms as shall be adopted from time to time by the relevant United
States taxing authorities) as may then be available under then current United
States laws and regulations to avoid, or such evidence as is satisfactory to the
Borrower and the Administrative Agent of any available exemption from or
reduction of, United States withholding taxes in respect of all payments to be
made to such Person by the Borrower pursuant to this Agreement, (b) promptly
notify the Administrative Agent of any change in circumstances which would
modify or render invalid any claimed exemption or reduction, and (c) take such
steps as shall not be materially disadvantageous to it, in the reasonable
judgment of such Lender, and as may be reasonably necessary (including the
re-designation of its Lending Office) to avoid any requirement of applicable
Laws that the Borrower make any deduction or withholding for taxes from amounts
payable to such Person. If such Person fails to deliver the above forms or other
documentation, then the Administrative Agent may withhold from any interest
payment to such Person an amount equivalent to the applicable withholding tax
imposed by Sections 1441 and 1442 of the Code, without reduction. If any
Governmental Authority asserts that the Administrative Agent did not properly
withhold any tax or other amount from payments made in respect of such Person,
such Person shall indemnify the Administrative Agent therefor, including all
penalties and interest, any taxes imposed by any jurisdiction on the amounts
payable to the Agent under this Section, and costs and expenses (including
Attorney Costs) of the Administrative Agent. The obligation of the Lenders under
this Section shall survive the payment of all Obligations and the resignation or
replacement of the Administrative Agent.

         SECTION 10.16 GOVERNING LAW.

         (a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO ITS CONFLICTS
OF LAW RULES OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATION LAW)
AND APPLICABLE FEDERAL LAW; AND THE ADMINISTRATIVE AGENT AND THE LENDERS SHALL
RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.

         (b) THE MLP, THE BORROWER, ANY OTHER PARTY HERETO, AND EACH GUARANTOR,
BY EXECUTION OF A GUARANTY, AGREES AS TO THIS SECTION 10.16(b). ANY LEGAL ACTION
OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE
BROUGHT IN THE COURTS OF THE STATE OF NEW YORK SITTING IN THE BOROUGH OF
MANHATTAN OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND BY
EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE MLP, THE BORROWER, THE
ADMINISTRATIVE AGENT, THE SWING LINE LENDER, THE L/C ISSUER, AND THE LENDERS
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. EACH OF THE MLP, THE BORROWER, THE ADMINISTRATIVE
AGENT, THE SWING LINE LENDER, THE L/C ISSUER, AND THE LENDERS IRREVOCABLY WAIVES
ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE
GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS
AGREEMENT OR ANY DOCUMENT RELATED HERETO. THE MLP, THE BORROWER, THE
ADMINISTRATIVE AGENT, THE SWING LINE LENDER, THE L/C ISSUER, AND THE LENDERS
EACH WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, AND
CONSENT TO THE SERVICE OF PROCESS IN ANY SUCH LEGAL ACTION OR PROCEEDING BY THE
MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED



                                       93
<PAGE>



MAIL, POSTAGE PREPAID, TO IT AT ITS ADDRESS SET FORTH IN SCHEDULE 10.02, SUCH
SERVICE TO BECOME EFFECTIVE TEN DAYS AFTER SUCH MAILING. NOTHING HEREIN SHALL
AFFECT THE RIGHT OF THE ADMINISTRATIVE AGENT, THE SWING LINE LENDER, THE L/C
ISSUER OR ANY LENDER TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW. EACH
OF THE MLP, THE BORROWER, AND EACH GUARANTOR, BY ITS EXECUTION OF A GUARANTY,
HEREBY IRREVOCABLY APPOINTS CT CORPORATION SYSTEM, WITH AN ADDRESS AT 111 EIGHTH
AVENUE, 13TH FLOOR, NEW YORK, NEW YORK 10011 (THE "NEW YORK PROCESS AGENT") AS
PROCESS AGENT IN ITS NAME, PLACE AND STEAD TO RECEIVE AND FORWARD SERVICE OF ANY
AND ALL WRITS, SUMMONSES AND OTHER LEGAL PROCESS IN ANY SUIT, ACTION OR
PROCEEDING BROUGHT IN THE STATE OF NEW YORK, AGREES THAT SUCH SERVICE IN ANY
SUCH SUIT, ACTION OR PROCEEDING MAY BE MADE UPON THE NEW YORK PROCESS AGENT, AND
AGREES TO TAKE ALL SUCH ACTION AS MAY BE NECESSARY TO CONTINUE SAID APPOINTMENT
IN FULL FORCE AND EFFECT.

         SECTION 10.17 WAIVER OF RIGHT TO TRIAL BY JURY, ETC. EACH PARTY TO THIS
AGREEMENT AND EACH GUARANTOR, BY EXECUTION OF A GUARANTY, HEREBY (a) EXPRESSLY
AND IRREVOCABLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH
OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES TO THE LOAN DOCUMENTS OR
ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED
THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER
FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND
CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED
BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN
ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE COMPANIES TO THE WAIVER OF THEIR RIGHT TO TRIAL
BY JURY; AND (b) EXPRESSLY AND IRREVOCABLY WAIVES, TO THE MAXIMUM EXTENT NOT
PROHIBITED BY LAW, ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY SUCH ACTION
ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES, OR DAMAGES OTHER
THAN, OR IN ADDITION TO, ACTUAL DAMAGES, PROVIDED THAT THE WAIVER CONTAINED IN
THIS CLAUSE (b) SHALL NOT APPLY TO THE EXTENT THAT THE PARTY AGAINST WHOM
DAMAGES ARE SOUGHT HAS ENGAGED IN GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.

         SECTION 10.18 MASTER CONSENT TO ASSIGNMENT. The Lenders hereby
authorize the Administrative Agent to enter into the Master Consent to
Assignment and each Lender agrees to be bound by all of the terms and provisions
of the Master Consent to Assignment to the same extent as if it were a signatory
thereto.

         SECTION 10.19 ENTIRE AGREEMENT. This Agreement and the other Loan
Documents represent the final agreement between the parties and may not be
contradicted by evidence of prior, contemporaneous, or subsequent oral
agreements of the parties. There are no unwritten oral agreements between the
parties.


                     [REMAINDER OF PAGE INTENTIONALLY BLANK;
                         SIGNATURES BEGIN ON NEXT PAGE]



                                       94
<PAGE>
         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.



                           MARTIN OPERATING PARTNERSHIP L.P.,
                           a Delaware limited partnership, as Borrower

                           By: MARTIN OPERATING GP LLC,
                               its General Partner

                               By: MARTIN MIDSTREAM PARTNERS L.P.,
                                   its Sole Member

                                   By: MARTIN MIDSTREAM GP LLC,
                                       its General Partner

                                       By: /s/ RUBEN S. MARTIN
                                           -------------------------------------
                                           Ruben S. Martin, III
                                           President and Chief Executive Officer



                           MARTIN MIDSTREAM PARTNERS L.P.,
                           a Delaware limited partnership, as Guarantor

                           By: MARTIN MIDSTREAM GP LLC,
                               its General Partner

                               By: /s/ RUBEN S. MARTIN
                                   ---------------------------------------------
                                   Ruben S. Martin, III
                                   President and Chief Executive Officer




                        [THIS IS A SIGNATURE PAGE TO THE
                 MARTIN OPERATING PARTNERSHIP CREDIT AGREEMENT]
<PAGE>
                                  ROYAL BANK OF CANADA, as Administrative Agent
                                  and Collateral Agent


                                  By: /s/ R.J. MCFARLANE
                                      -----------------------------------
                                      Name:  R.J. MCFARLANE
                                           ------------------------------
                                      Title:  Vice President
                                            -----------------------------




                        [THIS IS A SIGNATURE PAGE TO THE
                 MARTIN OPERATING PARTNERSHIP CREDIT AGREEMENT]
<PAGE>




                                      ROYAL BANK OF CANADA, as a Lender, as L/C
                                      Issuer, and as Swing Line Lender


                                      By: /s/ LORNE GARTNER
                                          -----------------------------------
                                          Lorne Gartner
                                          Vice President





                        [THIS IS A SIGNATURE PAGE TO THE
                 MARTIN OPERATING PARTNERSHIP CREDIT AGREEMENT]
<PAGE>


                                 COMERICA BANK - TEXAS, as a Lender


                                 By: /s/ PAUL L. STRANGE
                                     -----------------------------------
                                     Name: PAUL L. STRANGE
                                          ------------------------------
                                     Title: SVP
                                           -----------------------------





                        [THIS IS A SIGNATURE PAGE TO THE
                 MARTIN OPERATING PARTNERSHIP CREDIT AGREEMENT]
<PAGE>




                                     SOUTHWEST BANK OF TEXAS, N.A., as a Lender


                                     By: /s/ STEPHEN A. KENNEDY
                                         -----------------------------------
                                         Name:  Stephen A. Kennedy
                                                ----------------------------
                                         Title: Senior Vice President
                                                ----------------------------





                        [THIS IS A SIGNATURE PAGE TO THE
                 MARTIN OPERATING PARTNERSHIP CREDIT AGREEMENT]

<PAGE>


                                           WHITNEY NATIONAL BANK, as a Lender


                                           By: /s/ JAMES L. HACKER
                                               ---------------------------------
                                               Name: James L. Hacker
                                                    ----------------------------
                                               Title: Senior Vice President
                                                     --------------------------





                        [THIS IS A SIGNATURE PAGE TO THE
                 MARTIN OPERATING PARTNERSHIP CREDIT AGREEMENT]

<PAGE>
                                     HIBERNIA NATIONAL BANK, as a Lender


                                     By: /s/ SPENCER GAGNET
                                         ---------------------------------------
                                         Name: Spencer Gagnet
                                               ---------------------------------
                                         Title: Senior Vice President
                                                --------------------------------




                        [THIS IS A SIGNATURE PAGE TO THE
                 MARTIN OPERATING PARTNERSHIP CREDIT AGREEMENT]



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.2
<SEQUENCE>7
<FILENAME>d00990exv10w2.txt
<DESCRIPTION>CONTRIBUTION, CONVEYANCE AND ASSUMPTION AGREEMENT
<TEXT>
<PAGE>
                                                                    EXHIBIT 10.2

                                                                  EXECUTION COPY

                CONTRIBUTION, CONVEYANCE AND ASSUMPTION AGREEMENT

                  This Contribution, Conveyance and Assumption Agreement (this
"Agreement") dated effective as of October 31, 2002, is entered into by and
among Martin Resource Management Corporation, a Texas corporation ("MRMC"),
Martin Resource LLC, a Delaware limited liability company ("Martin LLC"), Martin
Midstream GP LLC, a Delaware limited liability company (the "GP"), Martin
Midstream Partners L.P., a Delaware limited partnership (the "MLP"), Martin
Operating GP LLC, a Delaware limited liability company (the "Operating GP"),
Martin Operating Partnership L.P., a Delaware limited partnership (the
"Operating Partnership"), Martin Gas Marine LLC, a Texas limited liability
company ("Marine LLC"), Martin Resources, Inc., a Texas corporation
("Resources"), Martin L.P. Gas, Inc., a Texas corporation ("MLP Gas"), Martin
Gas Sales LLC, a Texas limited liability company ("MGSLLC"), Martin Transport,
Inc., a Texas corporation ("Transport"), CF Martin Sulphur Holding Corporation,
a Nevada corporation ("CFM-SHC"), and Midstream Fuel Service LLC, an Alabama
limited liability company ("Midstream LLC").

                                    RECITALS

                  WHEREAS, prior to the date hereof, MRMC formed Martin LLC, as
a wholly-owned direct subsidiary, which in turn formed the GP, and contributed
$1,000 to it as a capital contribution in exchange for all of the membership
interests in the GP;

                  WHEREAS, in turn Martin LLC and the GP formed the MLP, with
the GP contributing $20 to it as a capital contribution in exchange for a 2%
general partner interest and Martin LLC contributing $980 to it as a capital
contribution in exchange for a 98% limited partner interest in the MLP;

                  WHEREAS, in turn Martin LLC formed the Operating GP, and
contributed $1,000 to it as a capital contribution in exchange for all of the
membership interests in the Operating GP;

                  WHEREAS, in turn Martin LLC and the Operating GP formed the
Operating Partnership, with the Operating GP contributing $1.00 in exchange for
a 0.1% general partner interest and Martin LLC contributing $999.0 in exchange
for a 99.9% limited partner interest in the Operating Partnership;

                  WHEREAS, Martin Gas Sales, Inc., a Texas corporation,
converted under Texas law into MGSLLC;

                  WHEREAS, Midstream Fuel Services, Inc., an Alabama
corporation, converted under Alabama law into Midstream LLC;

                  WHEREAS, Martin Gas Marine, Inc., a Texas corporation,
converted under Texas law into Marine LLC;



                                       1


<PAGE>

                  WHEREAS, each of the following transactions shall occur as of
12:01 A.M. Eastern Time on November 1, 2002, or on such other date prior to the
day of the closing of the offering of Common Units of the MLP (the "Closing") as
is mutually agreed upon by the parties hereto:

                  1. MRMC will contribute all of the outstanding membership
interests in Marine LLC (the "Marine Interest") and all of the outstanding
common stock of Resources (the "Resources Common Stock") to Martin LLC as a
capital contribution.

                  2. MGSLLC will contribute all of the outstanding common stock
(the "MLP Gas Common Stock") of MLP Gas to the Operating Partnership in exchange
for a 1.14% limited partner interest in the Operating Partnership;

                  3. Martin LLC will contribute the Marine Interest and the
Resources Common Stock to the Operating Partnership in exchange for a 50.13%
limited partner interest in the Operating Partnership;

                  4. The Operating Partnership will cause each of Resources and
MLP Gas to merge with and into the Operating Partnership, with the Operating
Partnership being the surviving entity.

                  5. MGSLLC will contribute to the Operating Partnership (i)
certain LPG Assets, as set forth in the Bill of Sale described in Section 2.6
below, (ii) certain real property and assets associated with the Mt. Belview
Railrack facility, (iii) all assets and property at MGSLLC's facility at 4118
Pendola Point Road, Tampa, Florida, including that certain Ground Lease
Agreement between MGSI and the Tampa Port Authority, and (iv) certain real
property and assets associated with the Stanolind Terminal, (all such assets set
forth in this paragraph referred to collectively as, the "LPG Assets") in
exchange for a 27.10% limited partner interest in the Operating Partnership;

                  6. Midstream LLC will contribute to the Operating Partnership
those assets set forth in the Bill of Sale described in Section 2.7 below
(collectively, the "Tenn-Tom Towing Assets") in exchange for a 14.30% limited
partner interest in the Operating Partnership;

                  7. Marine LLC will transfer to the Operating Partnership (i) a
25.05% interest in CF Martin Sulphur L.L.C. and (ii) certain office equipment
and vehicles (the "Marine Retained Equipment"), as more fully described in a
Bill of Sale to be executed by Marine LLC in favor of the Operating Partnership
(the "Marine Retained Equipment Bill of Sale"). All of the assets and properties
described in this recital are collectively referred to herein as the "Marine
Retained Assets";

                  8. The Operating Partnership will distribute to Martin LLC
(i)(A) the Marine Retained Assets, as more fully described in a Bill of Sale to
be executed by the Operating Partnership in favor of Martin LLC (the "Retained
Assets Bill of Sale"), and (ii)(A) a 50.00% limited partner interest in
Continental Sulfur Company LLC, (B) the lease for the facility located



                                       2
<PAGE>

in Hondo, Texas, together with all of the improvements and assets located at
such location, all as to be more fully described in an Assignment of Lease and
Bill of Sale to be executed by the Operating Partnership in favor of Martin LLC
(collectively, the "Hondo Conveyance Documents"), and (C) the real estate,
improvements and assets comprising the facility located at Troy, Alabama, all as
to be more fully described in a Special Warranty Deed and Bill of Sale to be
executed by the Operating Partnership in favor of Martin LLC (collectively, the
"Troy Conveyance Documents"). All of the assets and properties described in this
recital are collectively referred to herein as the "Retained Assets";

                  WHEREAS, on October 30, 2002, or on such other date as is
mutually agreed upon by the parties hereto, Transport shall sell the 7.3 shares
of the Common Stock of CFM-SHC (the "Transport Owned Shares") held by Transport
to MGSLLC in exchange for 40 shares of the Common Stock of MRMC;

                  WHEREAS, each of the following transactions shall occur as of
12:01 am Eastern Time on November 3, 2002, or on such other date as is mutually
agreed upon by the parties hereto (the "Dissolution Effective Time"):

                  1. Marine LLC and MGSLLC shall cause CFM-SHC to dissolve under
the laws of Nevada, and in such dissolution, CFM-SHC shall distribute its
assets, including its 49.5% limited partner interest in CF Martin Sulphur L.P.,
on a pro rata basis to Marine LLC and MGSLLC;

                  2. MGSLLC shall contribute the interest in CF Martin Sulphur
L.P. that it received upon the dissolution of CFM-SHC to the Operating
Partnership in exchange for a 7.33% limited partner interest in the Operating
Partnership;

                  WHEREAS, each of the following transactions shall occur as of
12:01 A.M. Eastern Time on the Closing (the "Closing Day Effective Time"):

                  1. MGSLLC will contribute its 35.57% limited partner interest
in the Operating Partnership to the MLP in exchange for 1,543,797 subordinated
units of the MLP representing limited partnership interests in the MLP
("Subordinated Units");

                  2. Midstream LLC will contribute its 14.30% limited partner
interest in the Operating Partnership to the MLP in exchange for 620,644
Subordinated Units;

                  3. Martin LLC will contribute (i) a 2.00% limited partner
interest in the Operating Partnership to the GP as a capital contribution, and
(ii) a 48.13% limited partner interest in the Operating Partnership and all of
its interest in the Operating GP to the MLP in exchange for 2,088,921
Subordinated Units of the MLP;

                  4. The GP will contribute the 2.00% limited partner interest
in the Operating Partnership it received from Martin LLC to the MLP in exchange
for (a) a continuation of its 2.00% general partner interest in the MLP and (b)
the issuance of incentive distribution rights to the GP;



                                       3
<PAGE>

                  5. The MLP will redeem the original 98% limited partner
interest in the MLP held by Martin LLC for $980 in cash.

                  WHEREAS, following the Closing, the Operating Partnership will
cause Marine LLC to merge with and into the Operating Partnership, with the
Operating Partnership being the Surviving Entity.

                  NOW, THEREFORE, in consideration of their mutual undertakings
and agreements hereunder, the parties to this Agreement undertake and agree as
follows:

                                   ARTICLE I
                                   RECORDATION

                  SECTION 1.1 RECORDATION OF EVIDENCE OF OWNERSHIP OF ASSETS. In
connection with the conveyances and mergers that are referred to in the recitals
to this Agreement, the parties to this Agreement acknowledge that certain
jurisdictions in which the assets of the applicable parties to such conveyances
and mergers are located may require that documents be recorded by the entities
resulting from such conveyances and mergers in order to evidence title to the
assets owned by such entities. All such documents shall evidence such new
ownership and are not intended to modify, and shall not modify, any of the
terms, covenants and conditions herein set forth.

                                   ARTICLE II
           MERGERS, CONTRIBUTIONS AND DISTRIBUTIONS OF VARIOUS ASSETS

                  SECTION 2.1 CONTRIBUTION OF MARINE INTEREST AND RESOURCES
COMMON STOCK BY MRMC TO MARTIN LLC. At the Contribution Effective Time, MRMC
hereby grants, contributes, transfers, assigns and conveys to Martin LLC, its
successors and assigns, all right, title and interest in and to (i) the Marine
Interest and (ii) the Resources Common Stock as a capital contribution.

                  SECTION 2.2 CONTRIBUTION OF MLP GAS COMMON STOCK TO THE
OPERATING PARTNERSHIP. At the Contribution Effective Time, MGSLLC hereby grants,
contributes, transfers, assigns and conveys to the Operating Partnership, its
successors and assigns, all right, title and interest in and to the MLP Gas
Common Stock in exchange for a 1.14% limited partner interest in the Operating
Partnership.

                  SECTION 2.3 CONTRIBUTION OF MARINE INTEREST AND RESOURCES
COMMON STOCK TO THE OPERATING PARTNERSHIP. At the Contribution Effective Time,
Martin LLC hereby grants, contributes, transfers, assigns and conveys to the
Operating Partnership, its successors and assigns, all right, title and interest
in and to (i) the Marine Interest and (ii) the Resources Common Stock in
exchange for a 50.13% limited partner interest in the Operating Partnership.

                  SECTION 2.4 MERGER OF RESOURCES INTO THE OPERATING
PARTNERSHIP. Pursuant to the Agreement and Plan of Merger attached hereto as
Exhibit A, at the Contribution Effective



                                       4
<PAGE>

Time, the Operating Partnership shall cause Resources to merge with and into the
Operating Partnership, with the Operating Partnership being the surviving
entity.

                  SECTION 2.5 MERGER OF MLP GAS INTO THE OPERATING PARTNERSHIP.
Pursuant to the Agreement and Plan of Merger attached hereto as Exhibit B, at
the Contribution Effective Time, the Operating Partnership shall cause MLP Gas
to merge with and into the Operating Partnership, with the Operating Partnership
being the surviving entity.

                  SECTION 2.6 CONTRIBUTION OF LPG ASSETS BY MGSLLC TO THE
OPERATING PARTNERSHIP. At the Contribution Effective Time, MGSLLC hereby grants,
contributes, transfers, assigns and conveys to the Operating Partnership, its
successors and assigns, all right, title and interest in and to the LPG Assets,
and the Operating Partnership hereby accepts the LPG Assets in exchange for a
27.10% limited partner interest in the Operating Partnership. In order to give
full effect to the foregoing grant, contribution, transfer, assignment and
conveyance, MGSLLC, as grantor, and the Operating Partnership, as grantee, shall
execute a Bill of Sale in the form attached hereto as Exhibit C together with
such other bills of sale, special warranty deeds, conveyances or other documents
required to transfer the LPG Assets in the jurisdictions in which they are
located.

                  SECTION 2.7 CONTRIBUTION OF TENN-TOM TOWING ASSETS BY
MIDSTREAM LLC TO THE OPERATING PARTNERSHIP. At the Contribution Effective Time,
Midstream LLC hereby grants, contributes, transfers, assigns and conveys to the
Operating Partnership, its successors and assigns, all right, title and interest
in and to the Tenn-Tom Towing Assets, and the Operating Partnership hereby
accepts the Tenn-Tom Towing Assets in exchange for a 14.30% limited partner
interest in the Operating Partnership. In order to give full effect to the
foregoing grant, contribution, transfer, assignment and conveyance, Midstream
LLC, as grantor, and the Operating Partnership, as grantee, shall execute a Bill
of Sale in the form attached hereto as Exhibit D together with any other bills
of sale, conveyances or other documents required by the United States Department
of Transportation or the United States Coast Guard to transfer the Tenn-Tom
Towing Assets.

                  SECTION 2.8 DISTRIBUTION OF THE MARINE RETAINED ASSETS BY
MARINE LLC TO THE OPERATING PARTNERSHIP. At the Contribution Effective Time,
Marine LLC hereby grants, distributes, transfers, assigns and conveys to the
Operating Partnership, its successors and assigns, all right, title, and
interest in and to the Marine Retained Assets. In order to give effect to the
foregoing grant, distribution, transfer, assignment and conveyance, Marine LLC,
as grantor, and the Operating Partnership, as grantee, shall execute (i) such
assignment documents as are necessary to transfer the 25.050% interest in CF
Martin Sulphur L.L.C. and (ii) the Marine Retained Equipment Bill of Sale,
together with any other bills of sale, conveyances or other documents as are
necessary to transfer the Marine Retained Assets to the Operating Partnership.

                  SECTION 2.9 DISTRIBUTION OF THE RETAINED ASSETS BY THE
OPERATING PARTNERSHIP TO MARTIN LLC. At the Contribution Effective Time, the
Operating Partnership hereby grants, distributes, transfers, assigns and conveys
to Martin LLC, its successors and assigns, all right, title, and interest in and
to the Retained Assets. In order to give full effect to the foregoing grant,
distribution, transfer, assignment and conveyance, the Operating



                                       5
<PAGE>

Partnership, as grantor, and Martin LLC, as grantee, shall execute (i) such
assignment documents as are necessary to transfer the 25.050% interest in CF
Martin Sulphur L.L.C., (ii) the Retained Assets Bill of Sale, (iii) the Hondo
Conveyance Documents, and (iv) the Troy Conveyance Documents, together with any
other bills of sale, conveyances or other documents as are necessary to transfer
the Retained Assets.

                  SECTION 2.10 PURCHASE OF TRANSPORT OWNED SHARES BY MGSLLC FROM
TRANSPORT. On October 30, 2002, or such other date as is mutually agreed upon by
the parties hereto, Transport hereby grants, contributes, transfers, assigns and
conveys to MGSLLC, its successors and assigns, all right, title and interest in
an to the Transport Owned Shares in exchange for 40 shares of the Common Stock
of MRMC.

                  SECTION 2.11 DISSOLUTION AND LIQUIDATION OF CFM-SHC. At the
Dissolution Effective Time, CFM-SHC shall liquidate, and hereby grants,
distributes, transfers, assigns and conveys to each of Marine LLC and MGSLLC,
their successors and assigns, on a pro-rata basis in accordance with the
percentage ownership that each of Marine LLC and MGSLLC hold in CFM-SHC, all
right, title and interest in and to all assets held by CFM-SHC, including its
49.5% limited partner interest in CF Martin Sulphur L.P.

                  SECTION 2.12 CONTRIBUTION OF CF MARTIN SULPHUR L.P. LIMITED
PARTNER INTEREST BY MGSLLC TO THE OPERATING PARTNERSHIP. At the Dissolution
Effective Time, MGSLLC hereby grants, contributes, transfers, assigns and
conveys to the Operating Partnership, its successors and assigns, all right,
title and interest in an to the limited partner interest in CF Martin Sulphur
L.P. that it received pursuant to Section 2.11 in exchange for a 7.33% limited
partner interest in the Operating Partnership.

                  SECTION 2.13 CONTRIBUTION OF OPERATING PARTNERSHIP INTEREST BY
MGSLLC TO THE MLP. At the Closing Day Effective Time, MGSLLC hereby grants,
contributes, transfers, assigns and conveys to the MLP, its successors and
assigns, all right, title and interest of MGSLLC in and to all of its 35.57%
limited partner interest in the Operating Partnership in exchange for 1,543,797
Subordinated Units of the MLP.

                  SECTION 2.14 CONTRIBUTION OF OPERATING PARTNERSHIP INTEREST BY
MIDSTREAM LLC TO THE MLP. At the Closing Day Effective Time, Midstream LLC
hereby grants, contributes, transfers, assigns and conveys to the MLP, its
successors and assigns, all right, title and interest of Midstream LLC in and to
its 14.30% limited partner interest in the Operating Partnership in exchange for
620,644 Subordinated Units of the MLP.

                  SECTION 2.15 CONTRIBUTION OF OPERATING PARTNERSHIP INTEREST BY
MARTIN LLC TO THE GP. At the Closing Day Effective Time, Martin LLC hereby
grants, contributes, transfers, assigns and conveys to the GP, its successors
and assigns, all right, title and interest of Martin LLC in and to a 2.00%
limited partner interest in the Operating Partnership as a contribution to the
capital of the GP.

                  SECTION 2.16 CONTRIBUTION OF OPERATING PARTNERSHIP INTEREST BY
THE GP TO THE MLP. At the Closing Day Effective Time, the GP hereby grants,
contributes, transfers,



                                       6
<PAGE>

assigns and conveys to the MLP, its successors and assigns, all right, title and
interest of the GP in and to the 2.00% limited partner interest in the Operating
Partnership that it received from Martin LLC (following the transaction set
forth in Section 2.15 above) in exchange for (a) a continuation of its 2%
general partner interest in the MLP and (b) the issuance to it by the MLP of the
incentive distribution rights under the First Amended and Restated Agreement of
Limited Partnership of the MLP.

                  SECTION 2.17 CONTRIBUTION OF OPERATING PARTNERSHIP INTEREST
AND THE OPERATING GP INTEREST BY MARTIN LLC TO THE MLP. At the Closing Day
Effective Time, Martin LLC hereby grants, contributes, transfers, assigns and
conveys to the MLP, its successors and assigns, all right, title and interest of
Martin LLC in and to (a) all of the remaining 48.13% limited partner interest in
the Operating Partnership held by Martin LLC and (b) the 100% membership
interest in the Operating GP held by Martin LLC to the MLP in exchange for
2,088,921 Subordinated Units of the MLP.

                  SECTION 2.18 REDEMPTION OF MARTIN LLC'S LIMITED PARTNER
INTEREST IN THE MLP. At the Closing Day Effective Time, the MLP hereby redeems
from Martin LLC all of Martin LLC's original 98% limited partner interest in the
MLP (exclusive of any Subordinated Units or other interests that Martin LLC has
received pursuant to the terms of this Article II), and in exchange therefore,
the MLP hereby pays to Martin LLC $980 in cash.

                  SECTION 2.19 MERGER OF MARINE LLC INTO THE OPERATING
PARTNERSHIP. Pursuant to the Agreement and Plan of Merger attached hereto as
Exhibit E, at the effective time set forth in such Agreement and Plan of Merger,
the Operating Partnership shall cause Marine LLC to merge with and into the
Operating Partnership, with the Operating Partnership being the surviving
entity.

                                  ARTICLE III
                        ASSUMPTION OF CERTAIN LIABILITIES

                  SECTION 3.1 ASSUMPTION OF LIABILITIES AND OBLIGATIONS BY THE
OPERATING PARTNERSHIP AND THE MLP.

                  (a) In connection with the contribution of the Tenn-Tom Towing
         Assets by Midstream LLC and the LPG Assets by MGSLLC to the Operating
         Partnership, as well as all of the assets (other than the Retained
         Assets) acquired by the Operating Partnership in connection with the
         mergers of Marine LLC, Resources and MLP Gas into the Operating
         Partnership, the Operating Partnership hereby assumes and agrees to
         duly and timely pay, perform and discharge all obligations and
         liabilities incurred with respect to the Contributed Assets, that arise
         from and after the date of this Agreement, to the full extent that
         either Midstream LLC, MGSLLC, Marine LLC, Resources or MLP Gas would
         have been obligated to pay, perform and discharge such obligations and
         liabilities in the future, were it not for the execution and delivery
         of this Agreement; provided, however, that said assumption and
         agreement to duly and timely pay, perform and discharge such
         obligations and liabilities shall not increase the obligation of the
         Operating Partnership with respect to such obligations and liabilities
         beyond that of any



                                       7
<PAGE>

         of Midstream as to the Tenn-Tom Towing Assets, MGSLLC as to the LPG
         Assets, or Marine LLC, Resources or MLP Gas as to the assets (other
         than the Retained Assets) acquired by the Operating Partnership in
         connection with such mergers, to the extent of such interest conveyed
         by any of Midstream LLC, MGSLLC, Marine LLC, Resources or MLP Gas. For
         purposes of this Agreement, the term "Contributed Assets" shall mean,
         collectively, the Tenn-Tom Towing Assets, the LPG Assets and all of the
         assets acquired by the Operating Partnership in connection with the
         mergers of Marine LLC, Resources and MLP Gas, but excluding the
         Retained Assets.

                  (b) In connection with the transfers of the Contributed Assets
         to the Operating Partnership, and the transfers of the Operating
         Partnership interests to the MLP, the Operating Partnership and the MLP
         will assume the existing debt as set forth on Schedule 3.1 attached
         hereto.

                                   ARTICLE IV
                                  TITLE MATTERS

                  SECTION 4.1 ENCUMBRANCES. The distributions of the Contributed
Assets in connection with the mergers of Marine LLC, Resources and MLP Gas into
the Operating Partnership, under this Agreement are made expressly subject to
all recorded and unrecorded liens, encumbrances, agreements, defects,
restrictions, adverse claim and all laws, rules, regulations, ordinances,
judgments and orders of governmental authorities or tribunals having or
asserting jurisdiction over the applicable Contributed Assets, and operations
conducted in connection therewith, in each case to the extent the same are valid
and enforceable and affect such Contributed Assets, including, without
limitation, (a) all matters that a current visual inspection of such Contributed
Assets would reflect, and (b) the liabilities assumed by the Operating
Partnership with respect to such Contributed Assets.

                  SECTION 4.2 Disclaimer of Warranties; Subrogation; Waiver of
Bulk Sales Laws.

                  (a) (i) NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN
         THIS AGREEMENT, THE MLP AND THE OPERATING PARTNERSHIP ACKNOWLEDGE AND
         AGREE THAT MRMC, MIDSTREAM LLC, MGSLLC, MARINE LLC, RESOURCES, AND MLP
         GAS HAVE NOT MADE, DO NOT MAKE, AND SPECIFICALLY NEGATE AND DISCLAIM,
         ANY REPRESENTATIONS, WARRANTIES, PROMISES, COVENANTS, AGREEMENTS OR
         GUARANTIES OF ANY KIND OR CHARACTER WHATSOEVER, WHETHER EXPRESS,
         IMPLIED OR STATUTORY, ORAL OR WRITTEN, PAST OR PRESENT (ALL OF WHICH
         ARE EXPRESSLY DISCLAIMED BY MRMC, MIDSTREAM LLC, MGSLLC, MARINE LLC,
         RESOURCES AND MLP GAS), REGARDING (1) THE TITLE, VALUE, NATURE, QUALITY
         OR CONDITION OF THE CONTRIBUTED ASSETS, (2) THE INCOME TO BE DERIVED
         FROM THE CONTRIBUTED ASSETS, (3) THE SUITABILITY OF THE CONTRIBUTED
         ASSETS FOR ANY AND ALL ACTIVITIES AND USES WHICH THE MLP MAY CONDUCT
         THEREON, (4) THE COMPLIANCE OF OR BY THE CONTRIBUTED ASSETS, OR THEIR



                                       8
<PAGE>

         OPERATIONS WITH ANY LAWS (INCLUDING WITHOUT LIMITATION ANY ZONING,
         ENVIRONMENTAL PROTECTION, POLLUTION OR LAND USE LAWS, RULES,
         REGULATIONS, ORDERS OR REQUIREMENTS), OR (5) THE HABITABILITY,
         MERCHANTABILITY, MARKETABILITY, PROFITABILITY OR FITNESS FOR A
         PARTICULAR PURPOSE OF THE CONTRIBUTED ASSETS.

                  (ii) THE MLP AND THE OPERATING PARTNERSHIP ACKNOWLEDGE AND
         AGREE THAT THEY HAVE HAD THE OPPORTUNITY TO INSPECT THE CONTRIBUTED
         ASSETS, AND THAT THEY ARE RELYING SOLELY ON THEIR OWN INVESTIGATION OF
         THE CONTRIBUTED ASSETS, AND NOT ON ANY INFORMATION PROVIDED OR TO BE
         PROVIDED BY MRMC, MIDSTREAM LLC, MGSLLC, MARINE LLC, RESOURCES OR MLP
         GAS. MRMC, MIDSTREAM LLC, MGSLLC, MARINE LLC, RESOURCES AND MLP GAS ARE
         NOT LIABLE OR BOUND IN ANY MANNER BY ANY VERBAL OR WRITTEN STATEMENTS,
         REPRESENTATIONS OR INFORMATION PERTAINING TO THE CONTRIBUTED ASSETS,
         FURNISHED BY ANY AGENT, EMPLOYEE, SERVANT OR THIRD PARTY.

                  (iii) THE MLP AND THE OPERATING PARTNERSHIP ACKNOWLEDGE THAT
         TO THE MAXIMUM EXTENT PERMITTED BY LAW, THE CONTRIBUTION OF THE
         CONTRIBUTED ASSETS, AS PROVIDED FOR HEREIN IS MADE ON AN "AS IS",
         "WHERE IS" BASIS WITH ALL FAULTS AND THE CONTRIBUTED ASSETS, ARE
         CONTRIBUTED OR DISTRIBUTED AND CONVEYED BY MIDSTREAM, MGSI, MARINE LLC,
         RESOURCES AND MLP GAS SUBJECT TO THE FOREGOING. THIS PARAGRAPH SHALL
         SURVIVE SUCH CONTRIBUTION OR DISTRIBUTION AND CONVEYANCE OR THE
         TERMINATION OF THIS AGREEMENT.

                  (iv) THE PROVISIONS OF THIS SECTION 4.2 HAVE BEEN NEGOTIATED
         BY MRMC, MIDSTREAM LLC, MGSLLC, MARINE LLC, RESOURCES, MLP GAS, THE MLP
         AND THE OPERATING PARTNERSHIP AFTER DUE CONSIDERATION AND ARE INTENDED
         TO BE A COMPLETE EXCLUSION AND NEGATION OF ANY REPRESENTATIONS OR
         WARRANTIES OF MRMC, MIDSTREAM LLC, MGSLLC, MARINE LLC, RESOURCES AND
         MLP GAS, WHETHER EXPRESS, IMPLIED OR STATUTORY, WITH RESPECT TO THE
         CONTRIBUTED ASSETS, THAT MAY ARISE PURSUANT TO ANY LAW NOW OR HEREAFTER
         IN EFFECT, OR OTHERWISE.

                  (b) The distributions and contributions of the Contributed
         Assets, made under this Agreement are made with full rights of
         substitution and subrogation of the Operating Partnership, and all
         persons claiming by, through and under the Operating Partnership, to
         the extent assignable, in and to all covenants and warranties by the
         predecessors-in-title of Midstream LLC, MGSLLC, Marine LLC, Resources
         and MLP Gas, and with full subrogation of all rights accruing under
         applicable statutes of limitation and all rights of action of warranty
         against all former owners of the Contributed Assets.



                                       9
<PAGE>

                  (c) Midstream LLC, MGSLLC, Marine LLC, Resources, MLP Gas, the
         MLP, the GP, the Operating Partnership and Operating GP agree that the
         disclaimers contained in this Section 4.2 are "conspicuous"
         disclaimers. Any covenants implied by statute or law by the use of the
         words "grant," "convey," "bargain," "sell," "assign," "transfer,"
         "deliver," or "set over" or any of them or any other words used in this
         Agreement or any exhibits hereto are hereby expressly disclaimed,
         waived or negated.

                  (d) Each of the parties hereto hereby waives compliance with
         any applicable bulk sales law or any similar law in any applicable
         jurisdiction in respect of the transactions contemplated by this
         Agreement. "Laws" means any and all laws, statutes, ordinances, rules
         or regulations promulgated by a governmental authority, orders of a
         governmental authority, judicial decisions, decisions of arbitrators or
         determinations of any governmental authority or court.

                                   ARTICLE V
                               FURTHER ASSURANCES

                  SECTION 5.1 FURTHER ASSURANCES. From time to time after the
date hereof, and without any further consideration, Midstream LLC, MGSLLC,
Martin LLC, the GP, the MLP, the Operating GP and the Operating Partnership
shall execute, acknowledge and deliver all such additional deeds, assignments,
bills of sale, conveyances, instruments, notices, releases, acquittances and
other documents, and will do all such other acts and things, all in accordance
with applicable law, as may be necessary or appropriate more fully and
effectively to vest in the Operating Partnership and the MLP and their
successors and assigns beneficial and record title to the Contributed Assets
hereby contributed and assigned to the Operating Partnership or intended so to
be and to more fully and effectively carry out the purposes and intent of this
Agreement.

                  SECTION 5.2 OTHER ASSURANCES. From time to time after the date
hereof, and without any further consideration, each of the parties to this
Agreement shall execute, acknowledge and deliver all such additional
instruments, notices and other documents, and will do all such other acts and
things, all in accordance with applicable law, as may be necessary or
appropriate to more fully and effectively carry out the purposes and intent of
this Agreement.

                                   ARTICLE VI
                                  MISCELLANEOUS

                  SECTION 6.1 HEADINGS; REFERENCES; INTERPRETATION. All article
and section headings in this Agreement are for convenience only and shall not be
deemed to control or affect the meaning or construction of any of the provisions
hereof. The words "hereof," "herein" and "hereunder" and words of similar
import, when used in this Agreement, shall refer to this Agreement as a whole,
including without limitation, all exhibits attached hereto, and not to any
particular provision of this Agreement. All references herein to articles,
sections, and exhibits shall, unless the context requires a different
construction, be deemed to be references to the articles, sections and exhibits
of this Agreement, respectively, and all such Exhibits attached hereto are
hereby incorporated herein and made a part hereof for all purposes. All personal
pronouns used in this Agreement, whether used in the masculine, feminine or
neuter gender,



                                       10
<PAGE>

shall include all other genders, and the singular shall include the plural and
vice versa. The use herein of the word "including" following any general
statement, term or matter shall not be construed to limit such statement, term
or matter to the specific items or matters set forth immediately following such
word or to similar items or matters, whether or not non-limiting language (such
as "without limitation," "but not limited to," or words of similar import) is
used with reference thereto, but rather shall be deemed to refer to all other
items or matters that could reasonably fall within the broadest possible scope
of such general statement, term or matter.

                  SECTION 6.2 SUCCESSORS AND ASSIGNS. The Agreement shall be
binding upon and inure to the benefit of the parties signatory hereto and their
respective successors and assigns.

                  SECTION 6.3 NO THIRD PARTY RIGHTS. The provisions of this
Agreement are intended to bind the parties signatory hereto as to each other and
are not intended to and do not create rights in any other person or confer upon
any other person any benefits, rights or remedies and no person is or is
intended to be a third party beneficiary of any of the provisions of this
Agreement.

                  SECTION 6.4 COUNTERPARTS. This Agreement may be executed in
any number of counterparts, all of which together shall constitute one agreement
binding on the parties hereto.

                  SECTION 6.5 GOVERNING LAW. This Agreement shall be governed
by, and construed in accordance with, the laws of the State of Texas applicable
to contracts made and to be performed wholly within such state without giving
effect to conflict of law principles thereof, except to the extent that it is
mandatory that the law of some other jurisdiction, shall apply.

                  SECTION 6.6 SEVERABILITY. If any of the provisions of this
Agreement are held by any court of competent jurisdiction to contravene, or to
be invalid under, the laws of any political body having jurisdiction over the
subject matter hereof, such contravention or invalidity shall not invalidate the
entire Agreement. Instead, this Agreement shall be construed as if it did not
contain the particular provision or provisions held to be invalid, and an
equitable adjustment shall be made and necessary provision added so as to give
effect to the intention of the parties as expressed in this Agreement at the
time of execution of this Agreement.

                  SECTION 6.7 AMENDMENT OR MODIFICATION. This Agreement may be
amended or modified from time to time only by the written agreement of all the
parties hereto.

                  SECTION 6.8 INTEGRATION. This Agreement, together with that
certain Omnibus Agreement dated of even date herewith, to be entered into by and
among MRMC, certain of MRMC's subsidiaries, the MLP, the GP, the Operating
Partnership and the Operating GP (the "Omnibus Agreement"), supersedes all
previous understandings or agreements between the parties, whether oral or
written, with respect to its subject matter. This document is an integrated
agreement which contains the entire understanding of the parties. No
understanding, representation, promise or agreement, whether oral or written,
other than those contained in the Omnibus Agreement, is intended to be or shall
be included in or form part of this Agreement



                                       11
<PAGE>

unless it is contained in a written amendment hereto executed by the parties
hereto after the date of this Agreement.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]



                                       12
<PAGE>


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


                                 MARTIN RESOURCE MANAGEMENT CORPORATION


                                 By: /s/ Robert D. Bondurant
                                     Robert D. Bondurant
                                     Chief Financial Officer


                                 MARTIN MIDSTREAM GP LLC


                                 By: /s/ Robert D. Bondurant
                                     Robert D. Bondurant
                                     Chief Financial Officer


                                 MARTIN MIDSTREAM PARTNERS L.P.

                                 By: MARTIN MIDSTREAM GP LLC


                                     By: /s/ Robert D. Bondurant
                                         Robert D. Bondurant
                                         Chief Financial Officer


                                 MARTIN GAS MARINE LLC

                                 By: Martin Resource Management Corporation
                                     As Sole Member


                                     By: /s/ Robert D. Bondurant
                                         Robert D. Bondurant
                                         Chief Financial Officer



                                       13
<PAGE>


                                 MARTIN RESOURCES, INC.


                                 By: /s/ Robert D. Bondurant
                                     Robert D. Bondurant
                                     Chief Financial Officer


                                 MARTIN GAS SALES LLC


                                 By: Martin Resource Management Corporation
                                     As Sole Member


                                     By: /s/ Robert D. Bondurant
                                         Robert D. Bondurant
                                         Chief Financial Officer


                                 MARTIN L.P. GAS, INC.


                                 By: /s/ Robert D. Bondurant
                                     Robert D. Bondurant
                                     Chief Financial Officer


                                 MARTIN TRANSPORT, INC.


                                 By: /s/ Robert D. Bondurant
                                     Robert D. Bondurant
                                     Chief Financial Officer


                                 MARTIN RESOURCE LLC

                                 By: Martin Resource Management Corporation
                                     As Sole Member


                                     By: /s/ Robert D. Bondurant
                                         Robert D. Bondurant
                                         Chief Financial Officer



                                       14
<PAGE>


                                 CF MARTIN SULPHUR HOLDING CORPORATION


                                 By: /s/ Robert D. Bondurant
                                     Robert D. Bondurant
                                     Chief Financial Officer


                                 MIDSTREAM FUEL SERVICE LLC


                                 By: Martin Resource Management Corporation
                                     As Sole Member


                                     By: /s/ Ruben S. Martin, III
                                     Name: Ruben S. Martin, III
                                     Title: President


                                 MARTIN OPERATING GP LLC

                                 By: Martin Resource LLC
                                     As Sole Member

                                     By: Martin Resource Management Corporation
                                         As Sole Member

                                         By: /s/ Ruben S. Martin, III
                                             Name: Ruben S. Martin, III
                                             Title: President



                                       15
<PAGE>
                                 MARTIN OPERATING PARTNERSHIP L.P.

                                 By: Martin Operating GP LLC, its General
                                     Partner

                                     By: Martin Resource LLC,
                                         As Sole Member

                                         By: Martin Resource Management
                                             Corporation
                                             As Sole Member


                                             By: /s/ Robert D. Bondurant
                                                 Robert D. Bondurant
                                                 Chief Financial Officer



                                       16
<PAGE>


                                    EXHIBIT A



<PAGE>


                          AGREEMENT AND PLAN OF MERGER


                                     BETWEEN

                             MARTIN RESOURCES, INC.

                                       AND

                        MARTIN OPERATING PARTNERSHIP L.P.




                          DATED AS OF NOVEMBER 1, 2002


<PAGE>


                          AGREEMENT AND PLAN OF MERGER


         This AGREEMENT AND PLAN OF MERGER (this "Agreement"), dated as of
November 1], 2002, but effective as of the Effective Time (as defined in Section
1.2), between Martin Resources, Inc., a Texas corporation ("Resources"), and
Martin Operating Partnership L.P., a Delaware limited partnership (the
"Partnership");

                                   WITNESSETH:

         WHEREAS, the Board of Directors of Resources has determined that it is
in the best interests of Resources and its sole shareholder to effectuate a
merger whereby Resources will be merged with and into the Partnership with the
Partnership being the surviving entity (the "Merger");

         WHEREAS, Martin Operating GP LLC, a Delaware limited liability company
and the General Partner of the Partnership (the "General Partner"), has
determined that it is in the best interests of the Partnership and its partners
to effectuate the Merger;

         WHEREAS, the Board of Directors of Resources and the sole member of the
General Partner have each approved the Merger, upon the terms and subject to the
conditions set forth in this Agreement; and

         NOW, THEREFORE, in consideration of the foregoing and of the covenants
and agreements contained herein, and of other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:

                                   ARTICLE I
                                   THE MERGER

         Section 1.1 The Merger. Subject to the terms and conditions of this
Agreement, and in accordance with the Texas Business Corporation Act (the
"TBCA") and the Delaware Revised Uniform Limited Partnership Act (the "DRULPA"),
at the Effective Time, Resources shall be merged with and into the Partnership
in accordance with this Agreement, and the separate corporate existence of
Resources shall thereupon cease. The Partnership shall continue as the surviving
entity in the Merger (sometimes hereinafter referred to as the "Surviving
Entity"), and all the properties, rights, privileges, powers and franchises of
Resources shall vest in the Surviving Entity without any transfer or assignment
having occurred, and all debts, liabilities and duties of Resources shall attach
to the Surviving Entity, all in accordance with the TBCA and the DRULPA.

         Section 1.2 Filing Certificate of Merger; Effective Time. As soon as
practicable following the satisfaction or, to the extent permitted by applicable
law, waiver of the conditions set forth in Article IV, if this Agreement shall
not have been terminated prior thereto as provided in Section 5.1, Resources and
the Partnership shall cause (i) articles of merger meeting the requirements of
Section 5.04 of the TBCA (the "Articles of Merger") and (ii) a certificate of




<PAGE>

merger meeting the requirements of Section 17-211 of the DRULPA (together with
the Articles of Merger, the "Merger Filings") to be properly executed and filed
in accordance with each such section. The Merger shall become effective at the
later of (1) the time of filing of the Merger Filings with the Secretaries of
State of the States of Texas and Delaware and (2) at 12:01 Eastern time on
November 1, 2002 (the "Effective Time").

                                   ARTICLE II
                                SURVIVING ENTITY

         Section 2.1 Name of Surviving Entity. The name of the Surviving Entity
shall be "Martin Operating Partnership L.P."

         Section 2.2 Certificate of Limited Partnership of Surviving Entity. The
Certificate of Limited Partnership of the Partnership shall continue to be the
Certificate of Limited Partnership of the Surviving Entity until amended as
provided therein and under the DRULPA.

                                  ARTICLE III
                          CANCELLATION OF COMMON STOCK

         Section 3.1 Cancellation of Common Stock in the Merger. At the
Effective Time, by virtue of the Merger and without any action on the part of
Resources or the sole shareholder of Resources, (i) each issued and outstanding
share of Common Stock shall be automatically cancelled, and (ii) each issued
share, if any, held by Resources as a treasury share shall be cancelled without
receipt of any consideration therefor.

                                   ARTICLE IV
                              CONDITIONS PRECEDENT

         The respective obligation of each party to effect the Merger is subject
to the satisfaction or waiver of the following conditions:

                  (a) None of the parties hereto shall be subject to any decree,
         order or injunction of a court of competent jurisdiction, U.S. or
         foreign, which prohibits the consummation of the Merger.

                  (b) Other than the filing of the Merger Filings provided for
         under Article I, all material consents, appeals, authorizations of, or
         filings or registrations with and notices to any governmental or
         regulatory authority required of Resources and the Partnership or any
         of their subsidiaries to consummate the Merger and the other
         transactions contemplated hereby, shall have been made or obtained.

                  (c) Any consents required under instruments evidencing
         indebtedness and any consents required under any contracts to which
         Resources or any subsidiary of Resources is a party, shall have been
         obtained.



                                      A-2

<PAGE>

                                   ARTICLE V
                        TERMINATION, AMENDMENT AND WAIVER

         Section 5.1 Termination. This Agreement may be terminated at any time
prior to the Effective Time by action of the Board of Directors of Resources or
the General Partner.

         Section 5.2 Effect of Termination. In the event of termination of this
Agreement as provided in Section 5.1, this Agreement shall forthwith become void
and have no effect, without any liability or obligation on the part of Resources
or the Partnership.

         Section 5.3 Amendment. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties hereto.

         Section 5.4 Waiver. At any time prior to the Effective Time, the
parties may waive compliance by the other parties with any of the agreements
contained in this Agreement, or may waive any of the conditions to consummation
of the Merger contained in this Agreement. Any agreement on the part of a party
to any such waiver shall be valid only if set forth in an instrument in writing
signed on behalf of such party. The failure of any party to this Agreement to
assert any of its rights under this Agreement or otherwise shall not constitute
a waiver of such rights.

                                   ARTICLE VI
                               GENERAL PROVISIONS

         Section 6.1 Assignment; Binding Effect; Benefit. Neither this Agreement
nor any of the rights, interests or obligations hereunder shall be assigned by
any of the parties hereto (whether by operation of law or otherwise) without the
prior written consent of the other parties. Subject to the preceding sentence,
this Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and assigns. Notwithstanding
anything contained in this Agreement to the contrary, nothing in this Agreement,
expressed or implied, is intended to confer on any person other than the parties
hereto or their respective successors and assigns any rights, remedies,
obligations or liabilities under or by reason of this Agreement.

         Section 6.2 Entire Agreement. This Agreement and any documents
delivered by the parties in connection herewith constitute the entire agreement
among the parties with respect to the subject matter hereof and supersede all
prior agreements and understandings among the parties with respect thereto. No
addition to or modification of any provision of this Agreement shall be binding
upon any party hereto unless made in writing and signed by all parties hereto.

         Section 6.3 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware without regard to
its rules of conflict of laws.

         Section 6.4 Counterparts. This Agreement may be executed by the parties
hereto in separate counterparts, each of which when so executed and delivered
shall be an original, but all



                                      A-3
<PAGE>

such counterparts shall together constitute one and the same instrument. Each
counterpart may consist of a number of copies hereof each signed by less than
all, but together signed by all of the parties hereto.

         Section 6.5 Headings. Headings of the Articles and Sections of this
Agreement are for the convenience of the parties only and shall be given no
substantive or interpretative effect whatsoever.



                                      A-4
<PAGE>


         IN WITNESS WHEREOF, Resources and the Partnership have caused this
Agreement to be signed by their respective officers thereunto duly authorized,
all as of the date first written above.

                                   MARTIN RESOURCES, INC.


                                   By:
                                      -----------------------------------------
                                      Robert D. Bondurant
                                      Chief Financial Officer



                                   MARTIN OPERATING PARTNERSHIP L.P.

                                   By: Martin Operating GP LLC
                                       Its General Partner

                                       By: Martin Resource LLC
                                           Its Sole Member

                                           By: Martin Resource Management
                                               Corporation
                                               Its Sole Member


                                               By:
                                                  -----------------------------
                                                  Robert D. Bondurant
                                                  Chief Financial Officer



                                      A-5
<PAGE>



                                    EXHIBIT B

<PAGE>


                          AGREEMENT AND PLAN OF MERGER


                                     BETWEEN

                              MARTIN L.P. GAS, INC.

                                       AND

                        MARTIN OPERATING PARTNERSHIP L.P.




                          DATED AS OF NOVEMBER 1, 2002


<PAGE>


                          AGREEMENT AND PLAN OF MERGER


         This AGREEMENT AND PLAN OF MERGER (this "Agreement"), dated as of
November 1, 2002, but effective as of the Effective Time (as defined in Section
1.2), between Martin L.P. Gas, Inc., a Texas corporation ("MLPG"), and Martin
Operating Partnership L.P., a Delaware limited partnership (the "Partnership");

                                   WITNESSETH:

         WHEREAS, the Board of Directors of MLPG has determined that it is in
the best interests of MLPG and its sole shareholder to effectuate a merger
whereby MLPG will be merged with and into the Partnership with the Partnership
being the surviving entity (the "Merger");

         WHEREAS, Martin Operating GP LLC, a Delaware limited liability company
and the General Partner of the Partnership (the "General Partner"), has
determined that it is in the best interests of the Partnership and its partners
to effectuate the Merger;

         WHEREAS, the Board of Directors of MLPG and the sole member of the
General Partner have each approved the Merger, upon the terms and subject to the
conditions set forth in this Agreement; and

         NOW, THEREFORE, in consideration of the foregoing and of the covenants
and agreements contained herein, and of other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:

                                   ARTICLE I
                                   THE MERGER

         Section 1.1 The Merger. Subject to the terms and conditions of this
Agreement, and in accordance with the Texas Business Corporation Act (the
"TBCA") and the Delaware Revised Uniform Limited Partnership Act (the "DRULPA"),
at the Effective Time, MLPG shall be merged with and into the Partnership in
accordance with this Agreement, and the separate corporate existence of MLPG
shall thereupon cease. The Partnership shall continue as the surviving entity in
the Merger (sometimes hereinafter referred to as the "Surviving Entity"), and
all the properties, rights, privileges, powers and franchises of MLPG shall vest
in the Surviving Entity without any transfer or assignment having occurred, and
all debts, liabilities and duties of MLPG shall attach to the Surviving Entity,
all in accordance with the TBCA and the DRULPA.

         Section 1.2 Filing Certificate of Merger; Effective Time. As soon as
practicable following the satisfaction or, to the extent permitted by applicable
law, waiver of the conditions set forth in Article IV, if this Agreement shall
not have been terminated prior thereto as provided in Section 5.1, MLPG and the
Partnership shall cause (i) articles of merger meeting the requirements of
Section 5.04 of the TBCA (the "Articles of Merger") and (ii) a certificate of
merger meeting the requirements of Section 17-211 of the DRULPA (together with
the Articles





<PAGE>

of Merger, the "Merger Filings") to be properly executed and filed in accordance
with each such section. The Merger shall become effective at the later of (1)
the time of filing of the Merger Filings with the Secretaries of State of the
States of Texas and Delaware and (2) at 12:01 a.m. Eastern time on November 1,
2002 (the "Effective Time").

                                   ARTICLE II
                                SURVIVING ENTITY

         Section 2.1 Name of Surviving Entity. The name of the Surviving Entity
shall be "Martin Operating Partnership L.P."

         Section 2.2 Certificate of Limited Partnership of Surviving Entity. The
Certificate of Limited Partnership of the Partnership shall continue to be the
Certificate of Limited Partnership of the Surviving Entity until amended as
provided therein and under the DRULPA.

                                  ARTICLE III
                          CANCELLATION OF COMMON STOCK

         Section 3.1 Cancellation of Common Stock in the Merger. At the
Effective Time, by virtue of the Merger and without any action on the part of
MLPG or the sole shareholder of MLPG, (i) each issued and outstanding share of
Common Stock shall be automatically cancelled, and (ii) each issued share, if
any, held by MLPG as a treasury share shall be cancelled without receipt of any
consideration therefor.

                                   ARTICLE IV
                              CONDITIONS PRECEDENT

         The respective obligation of each party to effect the Merger is subject
to the satisfaction or waiver of the following conditions:

                  (a) None of the parties hereto shall be subject to any decree,
         order or injunction of a court of competent jurisdiction, U.S. or
         foreign, which prohibits the consummation of the Merger.

                  (b) Other than the filing of the Merger Filings provided for
         under Article I, all material consents, appeals, authorizations of, or
         filings or registrations with and notices to any governmental or
         regulatory authority required of MLPG and the Partnership or any of
         their subsidiaries to consummate the Merger and the other transactions
         contemplated hereby, shall have been made or obtained.

                  (c) Any consents required under instruments evidencing
         indebtedness and any consents required under any contracts to which
         MLPG or any subsidiary of MLPG is a party, shall have been obtained.



                                      B-2

<PAGE>

                                   ARTICLE V
                        TERMINATION, AMENDMENT AND WAIVER

         Section 5.1 Termination. This Agreement may be terminated at any time
prior to the Effective Time by action of the Board of Directors of MLPG or the
General Partner.

         Section 5.2 Effect of Termination. In the event of termination of this
Agreement as provided in Section 5.1, this Agreement shall forthwith become void
and have no effect, without any liability or obligation on the part of MLPG or
the Partnership.

         Section 5.3 Amendment. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties hereto.

         Section 5.4 Waiver. At any time prior to the Effective Time, the
parties may waive compliance by the other parties with any of the agreements
contained in this Agreement, or may waive any of the conditions to consummation
of the Merger contained in this Agreement. Any agreement on the part of a party
to any such waiver shall be valid only if set forth in an instrument in writing
signed on behalf of such party. The failure of any party to this Agreement to
assert any of its rights under this Agreement or otherwise shall not constitute
a waiver of such rights.

                                   ARTICLE VI
                               GENERAL PROVISIONS

         Section 6.1 Assignment; Binding Effect; Benefit. Neither this Agreement
nor any of the rights, interests or obligations hereunder shall be assigned by
any of the parties hereto (whether by operation of law or otherwise) without the
prior written consent of the other parties. Subject to the preceding sentence,
this Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and assigns. Notwithstanding
anything contained in this Agreement to the contrary, nothing in this Agreement,
expressed or implied, is intended to confer on any person other than the parties
hereto or their respective successors and assigns any rights, remedies,
obligations or liabilities under or by reason of this Agreement.

         Section 6.2 Entire Agreement. This Agreement and any documents
delivered by the parties in connection herewith constitute the entire agreement
among the parties with respect to the subject matter hereof and supersede all
prior agreements and understandings among the parties with respect thereto. No
addition to or modification of any provision of this Agreement shall be binding
upon any party hereto unless made in writing and signed by all parties hereto.

         Section 6.3 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware without regard to
its rules of conflict of laws.

         Section 6.4 Counterparts. This Agreement may be executed by the parties
hereto in separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together constitute one
and the same instrument. Each counterpart may



                                      B-3
<PAGE>

consist of a number of copies hereof each signed by less than all, but together
signed by all of the parties hereto.

         Section 6.5 Headings. Headings of the Articles and Sections of this
Agreement are for the convenience of the parties only and shall be given no
substantive or interpretative effect whatsoever.



                                      B-4
<PAGE>


         IN WITNESS WHEREOF, MLPG and the Partnership have caused this Agreement
to be signed by their respective officers thereunto duly authorized, all as of
the date first written above.

                              MARTIN L.P. GAS, INC.


                              By:
                                 ----------------------------------------------
                                 Robert D. Bondurant
                                 Chief Financial Officer


                              MARTIN OPERATING PARTNERSHIP L.P.

                              By: Martin Operating GP LLC
                                  Its General Partner

                                  By: Martin Resource LLC
                                      Its Sole Member

                                      By: Martin Resource Management
                                          Corporation
                                          Its Sole Member


                                          By:
                                             ----------------------------------
                                             Robert D. Bondurant
                                             Chief Financial Officer



                                      B-5
<PAGE>


                                    EXHIBIT C


<PAGE>


                             CONVEYANCE, ASSIGNMENT
                                AND BILL OF SALE


         Recording Requested by and When Recorded Return to: Baker Botts L.L.P.,
2001 Ross Avenue, Dallas, Texas 75201, Attn: Chad D. Burkhardt.

                     CONVEYANCE, ASSIGNMENT AND BILL OF SALE

         This Conveyance, Assignment and Bill of Sale (this "Conveyance"),
effective as of 12:01 A.M. Eastern Time on November 1, 2002 (the "Effective
Date"), is from MARTIN GAS SALES LLC, a Texas limited liability company (herein
called "Grantor"), and in favor of MARTIN OPERATING PARTNERSHIP L.P., whose
mailing address is 4200 Stone Road, Kilgore Texas 75662 (herein called
"Grantee").

                                    ARTICLE I
                          GRANTING AND HABENDUM CLAUSES

         1.1 GRANTING AND HABENDUM CLAUSES. For good and valuable consideration,
the receipt and sufficiency of which Grantee hereby acknowledges, Grantor hereby
contributes, conveys, assigns, transfers, delivers, and sets over unto Grantee,
its successors and assigns, all right, title, interests and estate of Grantor in
and to the following described property, to-wit:

         ALL OF THE ASSETS SET FORTH ON SCHEDULE A ATTACHED HERETO

The property described in this Section 1.1 shall be referred to herein
collectively as the "Subject Property".

         TO HAVE AND TO HOLD the Subject Property, subject to the terms and
conditions hereof, unto Grantee, its successors and assigns, forever.

                                   ARTICLE II
                      ENCUMBRANCES AND WARRANTY DISCLAIMERS

         2.1 PERMITTED ENCUMBRANCES. This Conveyance is made and accepted
expressly subject to (a) all liens, charges, encumbrances, contracts,
agreements, instruments, obligations, defects, restrictions, security interests,
options or preferential rights to purchase, adverse claims, reservations,
exceptions, easements, rights-of-way, conditions, leases, other matters
affecting the Subject Property or to which it is subject; and (b) to all matters
that a current on the ground survey or visual inspection would reflect.

         2.2 CONTRIBUTION AGREEMENT. This Conveyance is expressly made subject
to the terms and conditions of that certain Contribution, Conveyance and
Assumption Agreement dated as of October __, 2002, among Grantor, Grantee and
the other parties thereto (the "Contribution Agreement"). All capitalized terms
used herein shall have the meanings given to such terms in the Contribution
Agreement, unless otherwise defined herein. Nothing contained in this





<PAGE>

Conveyance shall in any way affect the provisions set forth in the Contribution
Agreement nor shall this Conveyance expand or contract any rights or remedies
under the Contribution Agreement. This Conveyance is intended only to effect the
transfer of the Subject Property to Grantee as provided for in the Contribution
Agreement and shall be governed entirely in accordance with the terms and
conditions of the Contribution Agreement. In the event of a conflict between the
terms of this Conveyance and the terms of the Contribution Agreement, the terms
of the Contribution Agreement shall prevail.

         2.3 DISCLAIMER OF WARRANTIES; SUBROGATION. Except as expressly provided
herein or in the Contribution Agreement, this Conveyance is made, and is
accepted by Grantee, without warranty of title, express, implied or statutory,
and without recourse, but with full substitution and subrogation of Grantee, and
all persons claiming by, through, and under Grantee, to the extent assignable,
in and to all covenants and warranties by the predecessors in title of Grantor
and with full subrogation of all rights accruing under applicable statutes of
limitation or prescription and all rights of action of warranty against all
former owners of the Subject Property. Except as expressly provided herein or in
the Contribution Agreement, any covenants implied by statute or by the use of
the words "convey", "sell", "assign", "transfer", "deliver", or "set over" or
any of them or any other words used in this Conveyance, are hereby expressly
disclaimed, waived and negated.

                                   ARTICLE III
                                  MISCELLANEOUS

         3.1 FURTHER ASSURANCES. Grantor and Grantee agree to take all such
further actions and to execute, acknowledge and deliver all such further
documents that are necessary or useful in carrying out the purposes of this
Conveyance. So long as authorized by applicable law so to do, Grantor agrees to
execute, acknowledge and deliver to Grantee all such other additional
instruments, notices, affidavits, deeds, conveyances, assignments and other
documents and to do all such other and further acts and things as may be
necessary or useful to more fully and effectively grant, bargain, assign,
convey, transfer and deliver to Grantee the Subject Property conveyed hereby or
intended so to be conveyed.

         3.2 SUCCESSORS AND ASSIGNS; NO THIRD PARTY BENEFICIARY. This Conveyance
shall be binding upon, and shall and inure to the benefit of, Grantor and
Grantee and their successors and assigns. The provisions of this Conveyance are
not intended to and do not create rights in any other person or entity or confer
upon any other person or entity any benefits, rights or remedies and no person
or entity is or is intended to be a third party beneficiary of any of the
provisions of this Conveyance.

         3.3 GOVERNING LAW. This Conveyance and the legal relations between the
parties shall be governed by, and construed in accordance with, the laws of the
State of Texas, excluding any conflict of law rule which would refer any issue
to the laws of another jurisdiction, except when it is mandatory that the law of
the jurisdiction wherein the Subject Property is located shall apply.



                                      C-2
<PAGE>

         3.4 HEADINGS; REFERENCES; DEFINED TERMS. All Section headings in this
Conveyance are for convenience only and shall not be deemed to control or affect
the meaning or construction of any of the provisions hereof. The words "hereof",
"herein" and "hereunder" and words of similar import, when used in this
Conveyance, shall refer to this Conveyance as a whole, including, without
limitation, all Schedules and Exhibits attached hereto, and not to any
particular provision of this Conveyance.

         3.5 COUNTERPARTS. This Conveyance may be executed in any number of
counterparts, all of which together shall constitute one agreement binding on
the parties hereto.

         3.6 SEVERABILITY. If any of the provisions of this Conveyance are held
by any court of competent jurisdiction to contravene, or to be invalid under,
the laws of any political body having jurisdiction over the subject matter
hereof, such contravention or invalidity shall not invalidate the entire
agreement. Instead, this Conveyance shall be construed as if it did not contain
the particular provision or provisions held to be invalid and an equitable
adjustment shall be made and necessary provision added so as to give effect to
the intention of the parties as expressed in this Conveyance at the time of
execution of this Conveyance.



                                      C-3

<PAGE>

         IN WITNESS WHEREOF, this Conveyance has been duly executed by the
parties hereto on the dates of the acknowledgments set forth below, to be
effective, however, as of the Effective Date.

                             GRANTOR:

                             MARTIN GAS SALES LLC,

                             By: Martin Resource LLC,
                                 Its sole member

                                 By: Martin Resource Management
                                     Corporation,
                                     Its sole member


                                     By:
                                        ---------------------------------------
                                     Name:
                                          -------------------------------------
                                     Title:
                                           ------------------------------------


                             GRANTEE

                             MARTIN OPERATING PARTNERSHIP L.P.

                             By: Martin Operating GP LLC,
                                 Its general partner

                                 By: Martin Resource LLC,
                                     Its sole member

                                     By: Martin Resource Management Corporation,
                                         Its sole member

                                         By:
                                            -----------------------------------
                                         Name:
                                              ---------------------------------
                                         Title:
                                               --------------------------------



                                      C-4

<PAGE>
THE STATE OF TEXAS                  )
                                    )
COUNTY OF _________                 )


         This instrument was acknowledged before me on the ____ day of
___________, 2002, by ______________, ______________ of [.], on behalf of and in
[HIS/HER] capacity as __________ of [.].


                                            -----------------------------------
                                            NOTARY PUBLIC


My Commission Expires:

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


THE STATE OF TEXAS                  )
                                    )
COUNTY OF _________                 )


         This instrument was acknowledged before me on the ____ day of
___________, 2002, by ______________, ______________ of [.], on behalf of and in
[HIS/HER] capacity as __________ of [.].


                                            -----------------------------------
                                            NOTARY PUBLIC


My Commission Expires:

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



                                      C-5


<PAGE>


                                   SCHEDULE A



                                      C-6


<PAGE>



                                    EXHIBIT D



<PAGE>



                             CONVEYANCE, ASSIGNMENT
                                AND BILL OF SALE


         Recording Requested by and When Recorded Return to: Baker Botts L.L.P.,
2001 Ross Avenue, Dallas, Texas 75201, Attn: Chad D. Burkhardt.

                     CONVEYANCE, ASSIGNMENT AND BILL OF SALE

         This Conveyance, Assignment and Bill of Sale (this "Conveyance"),
effective as of 12:01 A.M. Eastern Time on November 1, 2002 (the "Effective
Date"), is from MIDSTREAM FUEL SERVICE LLC, an Alabama limited liability company
(herein called "Grantor"), and in favor of MARTIN OPERATING PARTNERSHIP L.P.,
whose mailing address is 4200 Stone Road, Kilgore Texas 75662 (herein called
"Grantee").

                                    ARTICLE I
                          GRANTING AND HABENDUM CLAUSES

         1.1 GRANTING AND HABENDUM CLAUSES. For good and valuable consideration,
the receipt and sufficiency of which Grantee hereby acknowledges, Grantor hereby
contributes, conveys, assigns, transfers, delivers, and sets over unto Grantee,
its successors and assigns, all right, title, interests and estate of Grantor in
and to the following described property, to-wit:

         ALL OF THE ASSETS SET FORTH ON SCHEDULE A ATTACHED HERETO

The property described in this Section 1.1 shall be referred to herein
collectively as the "Subject Property".

         TO HAVE AND TO HOLD the Subject Property, subject to the terms and
conditions hereof, unto Grantee, its successors and assigns, forever.

                                   ARTICLE II
                      ENCUMBRANCES AND WARRANTY DISCLAIMERS

         2.1 PERMITTED ENCUMBRANCES. This Conveyance is made and accepted
expressly subject to (a) all liens, charges, encumbrances, contracts,
agreements, instruments, obligations, defects, restrictions, security interests,
options or preferential rights to purchase, adverse claims, reservations,
exceptions, easements, rights-of-way, conditions, leases, other matters
affecting the Subject Property or to which it is subject; and (b) to all matters
that a current on the ground survey or visual inspection would reflect.

         2.2 CONTRIBUTION AGREEMENT. This Conveyance is expressly made subject
to the terms and conditions of that certain Contribution, Conveyance and
Assumption Agreement dated as of October __, 2002, among Grantor, Grantee and
the other parties thereto (the "Contribution Agreement"). All capitalized terms
used herein shall have the meanings given to such terms in the Contribution
Agreement, unless otherwise defined herein. Nothing contained in this




<PAGE>

Conveyance shall in any way affect the provisions set forth in the Contribution
Agreement nor shall this Conveyance expand or contract any rights or remedies
under the Contribution Agreement. This Conveyance is intended only to effect the
transfer of the Subject Property to Grantee as provided for in the Contribution
Agreement and shall be governed entirely in accordance with the terms and
conditions of the Contribution Agreement. In the event of a conflict between the
terms of this Conveyance and the terms of the Contribution Agreement, the terms
of the Contribution Agreement shall prevail.

         2.3 DISCLAIMER OF WARRANTIES; SUBROGATION. Except as expressly provided
herein or in the Contribution Agreement, this Conveyance is made, and is
accepted by Grantee, without warranty of title, express, implied or statutory,
and without recourse, but with full substitution and subrogation of Grantee, and
all persons claiming by, through, and under Grantee, to the extent assignable,
in and to all covenants and warranties by the predecessors in title of Grantor
and with full subrogation of all rights accruing under applicable statutes of
limitation or prescription and all rights of action of warranty against all
former owners of the Subject Property. Except as expressly provided herein or in
the Contribution Agreement, any covenants implied by statute or by the use of
the words "convey", "sell", "assign", "transfer", "deliver", or "set over" or
any of them or any other words used in this Conveyance, are hereby expressly
disclaimed, waived and negated.

                                   ARTICLE III
                                  MISCELLANEOUS

         3.1 FURTHER ASSURANCES. Grantor and Grantee agree to take all such
further actions and to execute, acknowledge and deliver all such further
documents, including all bills of sales and other instruments as are required by
the United States Department of Transportation or the United States Coast Guard
to transfer any of the Subject Assets, that are necessary or useful in carrying
out the purposes of this Conveyance. So long as authorized by applicable law so
to do, Grantor agrees to execute, acknowledge and deliver to Grantee all such
other additional instruments, notices, affidavits, deeds, conveyances,
assignments and other documents and to do all such other and further acts and
things as may be necessary or useful to more fully and effectively grant,
bargain, assign, convey, transfer and deliver to Grantee the Subject Property
conveyed hereby or intended so to be conveyed.

         3.2 SUCCESSORS AND ASSIGNS; NO THIRD PARTY BENEFICIARY. This Conveyance
shall be binding upon, and shall and inure to the benefit of, Grantor and
Grantee and their successors and assigns. The provisions of this Conveyance are
not intended to and do not create rights in any other person or entity or confer
upon any other person or entity any benefits, rights or remedies and no person
or entity is or is intended to be a third party beneficiary of any of the
provisions of this Conveyance.

         3.3 GOVERNING LAW. This Conveyance and the legal relations between the
parties shall be governed by, and construed in accordance with, the laws of the
State of Texas, excluding any conflict of law rule which would refer any issue
to the laws of another jurisdiction, except when it is mandatory that the law of
the jurisdiction wherein the Subject Property is located shall apply.



                                      D-2

<PAGE>

         3.4 HEADINGS; REFERENCES; DEFINED TERMS. All Section headings in this
Conveyance are for convenience only and shall not be deemed to control or affect
the meaning or construction of any of the provisions hereof. The words "hereof",
"herein" and "hereunder" and words of similar import, when used in this
Conveyance, shall refer to this Conveyance as a whole, including, without
limitation, all Schedules and Exhibits attached hereto, and not to any
particular provision of this Conveyance.

         3.5 COUNTERPARTS. This Conveyance may be executed in any number of
counterparts, all of which together shall constitute one agreement binding on
the parties hereto.

         3.6 SEVERABILITY. If any of the provisions of this Conveyance are held
by any court of competent jurisdiction to contravene, or to be invalid under,
the laws of any political body having jurisdiction over the subject matter
hereof, such contravention or invalidity shall not invalidate the entire
agreement. Instead, this Conveyance shall be construed as if it did not contain
the particular provision or provisions held to be invalid and an equitable
adjustment shall be made and necessary provision added so as to give effect to
the intention of the parties as expressed in this Conveyance at the time of
execution of this Conveyance.



                                      D-3

<PAGE>



         IN WITNESS WHEREOF, this Conveyance has been duly executed by the
parties hereto on the dates of the acknowledgments set forth below, to be
effective, however, as of the Effective Date.

                          GRANTOR:

                          MARTIN MIDSTREAM LLC,

                          By: Martin Resource Management Corporation,
                              Its sole member


                              By:
                                 ----------------------------------------------
                              Name:
                                   --------------------------------------------
                              Title:
                                    -------------------------------------------


                          GRANTEE

                          MARTIN OPERATING PARTNERSHIP L.P.

                          By: Martin Operating GP LLC,
                              Its general partner

                              By: Martin Resource LLC,
                                  Its sole member

                                  By: Martin Resource Management Corporation,
                                      Its sole member

                                      By:
                                         --------------------------------------
                                      Name:
                                           ------------------------------------
                                      Title:
                                            -----------------------------------



                               D-4

<PAGE>
THE STATE OF TEXAS                  )
                                    )
COUNTY OF _________                 )


         This instrument was acknowledged before me on the ____ day of
___________, 2002, by ______________, ______________ of [.], on behalf of and in
[HIS/HER] capacity as __________ of [.].


                                       ----------------------------------------
                                       NOTARY PUBLIC


My Commission Expires:

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


THE STATE OF TEXAS                  )
                                    )
COUNTY OF _________                 )


         This instrument was acknowledged before me on the ____ day of
___________, 2002, by ______________, ______________ of [.], on behalf of and in
[HIS/HER] capacity as __________ of [.].


                                       ----------------------------------------
                                       NOTARY PUBLIC


My Commission Expires:

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



                                       D-5

<PAGE>


                                   SCHEDULE A



                                      D-6

<PAGE>


                                    EXHIBIT E


<PAGE>


                          AGREEMENT AND PLAN OF MERGER


                                     BETWEEN

                              MARTIN GAS MARINE LLC

                                       AND

                        MARTIN OPERATING PARTNERSHIP L.P.



                          DATED AS OF NOVEMBER 1, 2002


<PAGE>



                          AGREEMENT AND PLAN OF MERGER


         This AGREEMENT AND PLAN OF MERGER (this "Agreement"), dated as of
November __, 2002, but effective as of the Effective Time (as defined in Section
1.2), between Martin Gas Marine LLC, a Texas limited liability company
("Marine"), and Martin Operating Partnership L.P., a Delaware limited
partnership (the "Partnership");

                                   WITNESSETH:

         WHEREAS, the sole member of Marine has determined that it is in the
best interests of Marine sole member to effectuate a merger whereby Marine will
be merged with and into the Partnership with the Partnership being the surviving
entity (the "Merger");

         WHEREAS, Martin Operating GP LLC, a Delaware limited liability company
and the General Partner of the Partnership (the "General Partner"), has
determined that it is in the best interests of the Partnership and its partners
to effectuate the Merger;

         WHEREAS, the sole member of Marine and the sole member of the General
Partner have each approved the Merger, upon the terms and subject to the
conditions set forth in this Agreement; and

         NOW, THEREFORE, in consideration of the foregoing and of the covenants
and agreements contained herein, and of other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:

                                  ARTICLE VII
                                   THE MERGER

         Section 1.1 The Merger. Subject to the terms and conditions of this
Agreement, and in accordance with the Texas Limited Liability Company Act (the
"TLLCA") and the Delaware Revised Uniform Limited Partnership Act (the
"DRULPA"), at the Effective Time, Marine shall be merged with and into the
Partnership in accordance with this Agreement, and the separate corporate
existence of Marine shall thereupon cease. The Partnership shall continue as the
surviving entity in the Merger (sometimes hereinafter referred to as the
"Surviving Entity"), and all the properties, rights, privileges, powers and
franchises of Marine shall vest in the Surviving Entity without any transfer or
assignment having occurred, and all debts, liabilities and duties of Marine
shall attach to the Surviving Entity, all in accordance with the TBCA and the
DRULPA.

         Section 1.2 Filing Certificate of Merger; Effective Time. As soon as
practicable following the satisfaction or, to the extent permitted by applicable
law, waiver of the conditions set forth in Article IV, if this Agreement shall
not have been terminated prior thereto as provided in Section 5.1, Marine and
the Partnership shall cause (i) articles of merger meeting the requirements of
the TLLCA (the "Articles of Merger") and (ii) a certificate of merger meeting
the requirements of Section 17-211 of the DRULPA (together with the Articles of
Merger, the "Merger Filings") to be properly executed and filed in accordance
with each such section. The



<PAGE>

Merger shall become effective at the later of (1) the time of filing of the
Merger Filings with the Secretaries of State of the States of Texas and Delaware
and (2) at 12:01 a.m. Eastern time on November __, 2002 (the "Effective Time").

                                   ARTICLE II
                                SURVIVING ENTITY

         Section 2.1 Name of Surviving Entity. The name of the Surviving Entity
shall be "Martin Operating Partnership L.P."

         Section 2.2 Certificate of Limited Partnership of Surviving Entity. The
Certificate of Limited Partnership of the Partnership shall continue to be the
Certificate of Limited Partnership of the Surviving Entity until amended as
provided therein and under the DRULPA.

                                  ARTICLE III
                          CANCELLATION OF COMMON STOCK

         Section 3.1 Cancellation of Membership Interests in the Merger. At the
Effective Time, by virtue of the Merger and without any action on the part of
Marine or the sole member of Marine, all outstanding membership interests in
Marine shall be automatically cancelled.

                                   ARTICLE IV
                              CONDITIONS PRECEDENT

         The respective obligation of each party to effect the Merger is subject
to the satisfaction or waiver of the following conditions:

                  (a) None of the parties hereto shall be subject to any decree,
         order or injunction of a court of competent jurisdiction, U.S. or
         foreign, which prohibits the consummation of the Merger.

                  (b) Other than the filing of the Merger Filings provided for
         under Article I, all material consents, appeals, authorizations of, or
         filings or registrations with and notices to any governmental or
         regulatory authority required of Marine and the Partnership or any of
         their subsidiaries to consummate the Merger and the other transactions
         contemplated hereby, shall have been made or obtained.

                  (c) Any consents required under instruments evidencing
         indebtedness and any consents required under any contracts to which
         Marine or any subsidiary of Marine is a party, shall have been
         obtained.



                                      E-2


<PAGE>

                                   ARTICLE V
                        TERMINATION, AMENDMENT AND WAIVER

         Section 5.1 Termination. This Agreement may be terminated at any time
prior to the Effective Time by action of the sole member of Marine or the
General Partner.

         Section 5.2 Effect of Termination. In the event of termination of this
Agreement as provided in Section 5.1, this Agreement shall forthwith become void
and have no effect, without any liability or obligation on the part of Marine or
the Partnership.

         Section 5.3 Amendment. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties hereto.

         Section 5.4 Waiver. At any time prior to the Effective Time, the
parties may waive compliance by the other parties with any of the agreements
contained in this Agreement, or may waive any of the conditions to consummation
of the Merger contained in this Agreement. Any agreement on the part of a party
to any such waiver shall be valid only if set forth in an instrument in writing
signed on behalf of such party. The failure of any party to this Agreement to
assert any of its rights under this Agreement or otherwise shall not constitute
a waiver of such rights.

                                   ARTICLE VI
                               GENERAL PROVISIONS

         Section 6.1 Assignment; Binding Effect; Benefit. Neither this Agreement
nor any of the rights, interests or obligations hereunder shall be assigned by
any of the parties hereto (whether by operation of law or otherwise) without the
prior written consent of the other parties. Subject to the preceding sentence,
this Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and assigns. Notwithstanding
anything contained in this Agreement to the contrary, nothing in this Agreement,
expressed or implied, is intended to confer on any person other than the parties
hereto or their respective successors and assigns any rights, remedies,
obligations or liabilities under or by reason of this Agreement.

         Section 6.2 Entire Agreement. This Agreement and any documents
delivered by the parties in connection herewith constitute the entire agreement
among the parties with respect to the subject matter hereof and supersede all
prior agreements and understandings among the parties with respect thereto. No
addition to or modification of any provision of this Agreement shall be binding
upon any party hereto unless made in writing and signed by all parties hereto.

         Section 6.3 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware without regard to
its rules of conflict of laws.

         Section 6.4 Counterparts. This Agreement may be executed by the parties
hereto in separate counterparts, each of which when so executed and delivered
shall be an original, but all



                                       E-3

<PAGE>

such counterparts shall together constitute one and the same instrument. Each
counterpart may consist of a number of copies hereof each signed by less than
all, but together signed by all of the parties hereto.

         Section 6.5 Headings. Headings of the Articles and Sections of this
Agreement are for the convenience of the parties only and shall be given no
substantive or interpretative effect whatsoever.



                                       E-4

<PAGE>


         IN WITNESS WHEREOF, Marine and the Partnership have caused this
Agreement to be signed by their respective officers thereunto duly authorized,
all as of the date first written above.

                          MARTIN GAS MARINE LLC

                          By: Martin Operating Partnership L.P.
                              Its Sole member

                              By: Martin Operating GP LLC
                                  Its General Partner

                                  By: Martin Midstream Partnership L.P.,
                                      Its Sole Member

                                      By: Martin Midstream GP LLC

                                          By:
                                             ----------------------------------
                                          Name:
                                               --------------------------------
                                          Title:
                                                -------------------------------


                              MARTIN OPERATING PARTNERSHIP L.P.

                              By: Martin Operating GP LLC
                                  Its General Partner

                                  By: Martin Midstream Partnership L.P.,
                                      Its Sole Member

                                      By: Martin Midstream GP LLC

                                          By:
                                             ----------------------------------
                                          Name:
                                               --------------------------------
                                          Title:
                                                -------------------------------



                                       E-5

<PAGE>


                                  SCHEDULE 3.1


                       DESCRIPTION OF ASSUMED INDEBTEDNESS

1.       $17,700,000 of the Indebtedness outstanding under that certain Amended
         and Restated Credit Agreement dated April 16, 2001, by and among Martin
         Resource Management Corporation ("Martin Resource"), certain
         subsidiaries of Martin Resource, the lenders from time to time party
         thereto and JP Morgan Chase Bank, as administrative agent for the
         lenders.

2.       Term loan, in the original principal amount of $25,000,000, pursuant to
         that certain Credit Agreement dated April 16, 2001, by and among Martin
         Resource, certain subsidiaries of Martin Resource and General Electric
         Capital Corporation, for Itself and as Agent for Certain Participants.

3.       Senior subordinated notes due December 15, 2006, in an aggregate
         principal amount of $30,000,000, issued by Martin Resource to J.P.
         Morgan Partners (SBIC), LLC pursuant to a Senior Subordinated Note
         Purchase Agreement dated as of December 16, 1998.

4.       Promissory note by Martin Gas Marine, Inc. ("MGM") dated September 25,
         1997 in favor of U.S. Bancorp Equipment Finance, Inc. (f/k/a U.S.
         Bancorp Leasing & Financial) ("U.S. Bancorp") in the original principal
         amount of $12,000,000.

5.       Indebtedness of MGM under the (i) Amended and Restated Schedule No. 002
         to Master Charter Agreement, dated December 30, 1997, between MGM and
         U.S. Bancorp, requiring 120 monthly payments, which currently are
         $20,849.93 and increase to $25,483.25 beginning with the 61st payment
         and (ii) Amended and Restated Schedule No. 003 to Master Charter
         Agreement, dated December 30, 1997, between MGM and U.S. Bancorp,
         requiring 120 monthly payments, which currently are $20,849.93 and
         increase to $25,483.25 beginning with the 61st payment.



                                       E-6


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.3
<SEQUENCE>8
<FILENAME>d00990exv10w3.txt
<DESCRIPTION>OMNIBUS AGREEMENT
<TEXT>
<PAGE>
                                                                    EXHIBIT 10.3

                                                                  EXECUTION COPY

================================================================================



                                OMNIBUS AGREEMENT

                                     BETWEEN

                     MARTIN RESOURCE MANAGEMENT CORPORATION,

                            MARTIN MIDSTREAM GP LLC,

                         MARTIN MIDSTREAM PARTNERS L.P.

                                       AND

                        MARTIN OPERATING PARTNERSHIP L.P.



================================================================================



<PAGE>



                                OMNIBUS AGREEMENT

         THIS OMNIBUS AGREEMENT is entered into as of November 1, 2002 by and
among Martin Resource Management Corporation, a Texas corporation ("MRMC"),
Martin Midstream GP LLC, a Delaware limited liability company (the "General
Partner"), Martin Midstream Partners L.P., a Delaware limited partnership (the
"Partnership"), and Martin Operating Partnership L.P. (the "Operating
Partnership"). The above-named entities are sometimes referred to in this
Agreement each as a "Party" and collectively as the "Parties."

                                   RECITALS:

         WHEREAS, MRMC and its Affiliates (as defined herein) formed the
Partnership, the General Partner and the Operating Partnership for the purpose
of conducting of the Business (as defined below);

         WHEREAS, certain assets and services used by MRMC or its Affiliates in
the conduct of the Business prior to the formation of the Partnership were not
transferred to the Partnership;

         WHEREAS, the Parties desire to ensure the continued effective operation
of the Business, and the Parties recognize that the continued effective
operation of the Business requires that MRMC provide certain management and
employee services to the Business as set forth in this Agreement;

         WHEREAS, the Parties desire to evidence their understanding, as more
fully set out in this Agreement, with respect to those business opportunities
that MRMC will not engage in for so long as the Partnership is an Affiliate of
MRMC unless the Partnership has declined to engage in any such business
opportunity for its own account and the procedures whereby such business
opportunities are to be offered to the Partnership and accepted or declined;

         WHEREAS, the Operating Partnership owns a 49.5% limited partner
interest in CF Martin Sulphur, L.P., a Delaware limited partnership ("CF
Martin") and the Parties desire to evidence their understanding, as more fully
set out in this Agreement, regarding the exercise by MRMC of its rights in
relation to the management and operation of CF Martin through MRMC's ownership
of 50% of C.F. Martin Sulphur, L.L.C., a Delaware limited liability company and
the general partner of CF Martin (the "CF Martin GP"); and

         WHEREAS, the Parties desire to evidence other agreements and
relationships, as more fully set out in this Agreement, with respect to the
transfer of the Business to the Partnership and the Operating Partnership as
well as the operation of the Business by the Partnership and the Operating
Partnership.

         NOW THEREFORE, in consideration of the premises and the covenants,
conditions, and agreements contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Parties hereto hereby agree as follows:



<PAGE>
                                                                  EXECUTION COPY


                                   ARTICLE I
                                   DEFINITIONS

         DEFINITIONS. As used in this Agreement, the following terms shall have
the respective 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. As used herein, the term "control" means the possession,
         direct or indirect, of the power to direct or cause the direction of
         the management and policies of a Person, whether through ownership of
         voting securities, by contract or otherwise.

                  "Agreement" means this Omnibus Agreement, as it may be
         amended, modified, or supplemented from time to time in accordance with
         Section 6.8 hereof.

                  "Allocated General and Administrative Expenses" means expenses
         associated with general and administrative services provided by MRMC
         and its Subsidiaries (other than the Partnership and its Subsidiaries),
         including, but not limited to, certain management, engineering,
         accounting, finance, information technology, insurance, human resource,
         administration of employee benefit plans and other shared corporate
         services, that are allocated to the Partnership by MRMC on the same
         basis as these types of expenses are allocated among MRMC and its
         Subsidiaries (other than the Partnership and its Subsidiaries).

                  "Assets" means the "Contributed Assets" as such term is
         defined in the Contribution Agreement.

                  "Business" means (i) providing marine transportation,
         terminalling, distribution and midstream logistical services for
         hydrocarbon products and by-products, and (ii) manufacturing and
         marketing fertilizers and related sulfur-based products.

                  "CF Martin" is defined in the Recitals to this Agreement.

                  "CF Martin GP" is defined in the Recitals to this Agreement.

                  "CF Martin GP Agreement" means the Limited Liability Company
         Agreement of CF Martin GP, dated November 22, 2000, as amended to date.

                  "CF Martin LP Agreement" means the Agreement of Limited
         Partnership of C.F. Martin, dated November 22, 2000, as amended to
         date.

                  "Closing Date" means the date of the closing of the
         Partnership's initial public offering of Common Units of the
         Partnership.

                  "Conflicts Committee" is defined in the Partnership Agreement.



                                       2
<PAGE>
                                                                  EXECUTION COPY


                  "Consumer Price Index" means the "Consumer Price Index for
         Urban Wage Earners and Clerical Workers (1967 = 100)" specified for
         "All Item - United States" compiled by the Bureau of Labor Statistics
         for the United States.

                  "control" means the possession, directly or indirectly, of the
         power to direct or cause the direction of the management and policies
         of a Person, whether through ownership of voting securities, by
         contract or otherwise.

                  "Contribution Agreement" means the Contribution, Conveyance
         and Assumption Agreement, dated October 31, 2002, by and among various
         MRMC Entities, the Partnership, the Operating Partnership, the General
         Partner and Martin Operating GP LLC, a Delaware limited liability
         company.

                  "Covered Environmental Losses" is defined in Section 3.1(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 human health and 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.

                  "Exchange Act" means the Securities Exchange Act of 1934, as
         amended.

                  "General Partner" is defined in the introduction to this
         Agreement.

                  "Hazardous Substance" means 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.

                  "Indemnified Party" means the Partnership Entities or the MRMC
         Entities, as the case may be, in their capacity as the parties entitled
         to indemnification in accordance with Article III.

                  "Indemnifying Party" means either the Partnership Entities or
         the MRMC Entities, as the case may be, in its capacity as the parties
         from whom indemnification may be sought in accordance with Article III.

                  "Indirect Expenses Limit" is defined in Section 4.2(a).

                  "J.V. Management Rights" is defined in Section 6.2.


                                       3
<PAGE>
                                                                  EXECUTION COPY


                  "Losses" means 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.

                  "Martin Manager" is defined in the CF Martin GP Agreement.

                  "MRMC" is defined in the introduction to this Agreement.

                  "MRMC Entities" means MRMC and each of its Subsidiaries (other
         than the General Partner, the Partnership and any Subsidiary of the
         Partnership).

                  "Names and Marks" means the tradenames and logos attached
         hereto on Schedule 1.

                  "Offer" is defined in Section 2.3(b).

                  "Partnership" is defined in the introduction to this
         Agreement.

                  "Partnership Agreement" means the First Amended and Restated
         Agreement of Limited Partnership of the Martin Midstream Partners L.P.,
         dated as of, and in the form on, the Closing Date. No amendment or
         modification to the Partnership Agreement subsequent to the Closing
         Date shall be given effect for the purposes of this Agreement unless
         consented to by each of the Parties to this Agreement.

                  "Partnership Entities" means the Partnership, the General
         Partner, and each Subsidiary of the Partnership.

                  "Party" and "Parties" is defined in the introduction to this
         Agreement.

                  "Pass-Through Environmental Losses" is defined in Section
         3.1(b).

                  "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.

                  "Restricted Portion" is defined in Section 2.2(c)(iv).

                  "Retained Assets" means, collectively, (i) any assets and
         investments owned by any of the MRMC Group that were not conveyed,
         contributed or otherwise transferred to any of the Partnership Entities
         prior to or on the Closing Date, and (ii) the "Retained Assets" as such
         term is defined in the Contribution Agreement.

                  "Services" is defined in Section 4.1.




                                       4
<PAGE>
                                                                  EXECUTION COPY


                  "Subject Assets" is defined in Section 2.2(c).

                  "Subsidiary" means, with respect to any Person, (a) a
         corporation of which more than 50% of the Voting Power 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 interest or (ii)
         the power to elect or direct the election of a majority of the
         directors or other governing body of such Person.

                  "Venture Interest" is defined in the CF Martin LP Agreement.

                  "Voting Stock" means securities of any class of a Person
         entitling the holders thereof to vote on a regular basis in the
         election of members of the board of directors or other governing body
         of such Person.

                                   ARTICLE II
                             BUSINESS OPPORTUNITIES

         2.1 RESTRICTED ACTIVITIES. For so long as MRMC controls the General
Partner, or any subsequent general partner of the Partnership and except as
permitted by Section 2.2, MRMC shall be prohibited from engaging in, directly or
indirectly through an Affiliate, whether by acquisition, construction or
otherwise, the Business.

         2.2 PERMITTED EXCEPTIONS. Notwithstanding any provision of Section 2.1
to the contrary, MRMC and its Affiliates may engage in the following activities
under the following circumstances:

                  (a) The ownership and/or operation of any of the Retained
Assets (including replacements of and modifications or additions to the Retained
Assets) and the conduct of the businesses operated by MRMC and its Affiliates on
the Closing Date that were not transferred to the Partnership Entities and that
are described on Schedule 2.2(a);

                  (b) The operation on behalf of a member of any Partnership
Entity of any asset or group of assets owned by any Partnership Entity;

                  (c) The ownership and/or operation of any asset or group of
related assets used in a Business that are acquired or constructed by MRMC or
any of its Affiliates (other than any of the Partnership Entities) after the
date of this Agreement (the "Subject Assets") if:




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                  (i) the fair market value of the Subject Assets (as determined
         in good faith by the Board of Directors of MRMC) is less than $5.0
         million at the time of such acquisition by any of the MRMC Entities or
         completion of construction, as the case may be;

                  (ii) in the case of an acquisition of Subject Assets with a
         fair market value (as determined in good faith by the Board of
         Directors of MRMC) equal to or greater than $5.0 million at the time of
         such acquisition by MRMC, the Partnership has been offered the
         opportunity to purchase the Subject Assets within 90 days of such
         acquisition in accordance with Section 2.3(b) and the Partnership (with
         the concurrence of the Conflicts Committee) has elected not to purchase
         the Subject Assets;

                  (iii) in the case of the construction of Subject Assets with a
         fair market value (as determined in good faith by the Board of
         Directors of MRMC) equal to or greater than $5.0 million at the time of
         completion of construction, the Partnership has been offered the
         opportunity to purchase the Subject Assets in accordance with Section
         2.3(b) and the Partnership (with the concurrence of the Conflicts
         Committee) has elected not to purchase the Subject Assets; or

                  (iv) in case of the acquisition or construction of any Subject
         Assets, a portion of which participate in a Business (the "Restricted
         Portion"), where the Restricted Portion has a fair market value (as
         determined in good faith by the Board of Directors of MRMC) that is (i)
         greater than $5.0 million and (ii) less than 20% of the aggregate value
         of the business or assets acquired or constructed (as determined in
         good faith by the Board of Directors of MRMC), the Partnership is
         offered the opportunity to purchase the Subject Assets related to the
         Restricted Portion in accordance with Section 2.3(b) and the
         Partnership (with the concurrence of the Conflicts Committee) has
         elected not to purchase such Subject Assets.

         2.3 PROCEDURES.

             (a) If any of the MRMC Entities becomes aware of an opportunity to
purchase Subject Assets described in Section 2.2(c)(ii), then as soon as
practicable, MRMC shall notify the General Partner of such opportunity and
deliver to the General Partner all information prepared by or on behalf of MRMC
relating to such potential purchase. As soon as practicable but in any event
within 30 days after receipt of such notification and information, the General
Partner, on behalf of the Partnership, shall notify MRMC that either (i) the
General Partner, on behalf of the Partnership, has elected, with the approval of
the Conflicts Committee, not to cause any of the Partnership Entities to pursue
the opportunity to acquire such Subject Assets, or (ii) the General Partner, on
behalf of the Partnership, has elected to cause any of the Partnership Entities
to pursue the opportunity to acquire such Subject Assets. If, at any time, the
General Partner abandons such opportunity with the approval of the Conflicts
Committee (as evidenced in writing by the General Partner following the request
of MRMC), MRMC may pursue such opportunity. Any Subject Assets that are
permitted to be purchased by MRMC pursuant to this Section 2.3(a) must be so
purchased (i) within 12 months of the time MRMC becomes able to pursue such
opportunity in accordance with the provisions of this Section 2.3(a) and (ii) on
terms



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not materially more favorable to MRMC than were offered to the Partnership. If
either of these conditions are not satisfied, the opportunity must be reoffered
to the Partnership in accordance with this Section 2.3(a).

             (b) If any MRMC Entity constructs or acquires Subject Assets as
described in Section 2.2(c)(iii) and (iv), then not later than 90 days after the
consummation of the completion of construction or acquisition by any MRMC Entity
of the Subject Assets, as the case may be, MRMC shall notify the General Partner
in writing of such construction or acquisition and offer the Partnership
Entities the opportunity to purchase the Subject Assets or, in the case of
Subject Assets described in Section 2.2(c)(iv), the Subject Assets related to
the Restricted Portion, in each case for their fair market value in accordance
with this Section 2.3 (the "Offer"). The Offer shall set forth MRMC's proposed
terms relating to the construction or purchase of such Subject Assets by any of
the Partnership Entities. MRMC will provide all information concerning the
business, operations and finances of such Subject Assets as may be reasonably
requested by the General Partner. As soon as practicable, but in any event
within 60 days after receipt of such written notification, the General Partner
shall notify MRMC in writing that either (i) the General Partner has elected,
with the approval of the Conflicts Committee, not to cause any of the
Partnership Entities to purchase such Subject Assets, in which event MRMC shall
be forever free to continue to own or operate such Subject Assets; provided,
however, that any future acquisitions or opportunities related to such
particular Subject Assets (except for expansions of existing facilities and
except as provided in Section 2.2(c)(i)) shall be subject to the procedures set
forth in this Section 2.3, or (ii) the General Partner has elected to cause any
of the Partnership Entities to purchase such Subject Assets, in which event the
procedures outlined in this Section 2.3 shall apply.

             (c) After the receipt of such Offer by the General Partner, MRMC
and the General Partner shall negotiate in good faith the terms on which such
Subject Assets will be sold to a Partnership Entity. If MRMC and the General
Partner (with the concurrence of the Conflicts Committee) are able to agree on
the fair market value of the Subject Assets that are subject to the Offer and
the other terms of the Offer within 60 days after receipt by the General Partner
of the Offer, one or more of the Partnership Entities shall purchase such
Subject Assets for the agreed upon fair market value as soon as commercially
practicable after such agreement has been reached.

             (d) If MRMC and the General Partner are unable to agree on the fair
market value of the Subject Assets that are subject to the Offer or the other
terms of the Offer within 60 days after receipt by the General Partner of the
Offer, MRMC and the General Partner will engage a mutually agreed upon,
nationally recognized investment banking firm to determine the fair market value
of such Subject Assets. Such investment banking firm will determine the fair
market value of such Subject Assets within 30 days of its engagement and furnish
MRMC and the General Partner its determination. The fees and expenses of the
investment banking firm will be split equally between MRMC and the Partnership
Entities. Once the investment banking firm has submitted its determination of
the fair market value of the Subject Assets, the General Partner will have the
right, but not the obligation, subject to the approval of the Conflicts
Committee, to cause one or more of the Partnership Entities to purchase such
Subject Assets pursuant to the Offer as modified by the determination of the
investment banking firm. If the General Partner elects to cause one or more of
the Partnership Entities to purchase such Subject



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Assets, then such Partnership Entities shall purchase such Subject Assets
pursuant to the Offer as modified by the determination of the investment banking
firm as soon as commercially practicable after such determination. If the
General Partner elects not to cause any of the Partnership Entities to purchase
such Subject Assets, MRMC shall be forever free to continue to own or operate
such Subject Assets; provided, however, that any future acquisitions or
opportunities related to such Subject Assets (except for expansions of existing
facilities and except as provided in Section 2.2(c)(i)) shall be subject to the
procedures set forth in this Section 2.3.

         2.4 SCOPE OF PROHIBITION. Except as provided in this Article II and the
Partnership Agreement, each of MRMC and its Affiliates shall be free to engage
in any business activity whatsoever, including those that may be in direct
competition with any Partnership Entity.

         2.5 ENFORCEMENT. MRMC agrees and acknowledges that the Partnership
Entities do not have an adequate remedy at law for the breach by MRMC of the
covenants and agreements set forth in this Article II, and that any breach by
MRMC of the covenants and agreements set forth in Article II would result in
irreparable injury to the Partnership Entities. MRMC further agree and
acknowledge that any member of the Partnership Entities may, in addition to the
other remedies which may be available to the Partnership Entities, file a suit
in equity to enjoin MRMC from such breach, and consent to the issuance of
injunctive relief under this Agreement.

                                  ARTICLE III
                                 INDEMNIFICATION

         3.1 ENVIRONMENTAL INDEMNIFICATION.

             (a) Subject to the limitations contained in this Section 3.1(a),
MRMC shall indemnify, defend and hold harmless each of the Partnership Entities
from and against environmental and toxic tort Losses suffered or incurred by any
of the Partnership Entities by reason of or arising out of:

                  (i) any violation or correction of violation of Environmental
         Laws associated with the Assets or the Retained Assets, or

                  (ii) any event or condition associated with the ownership or
         operation of the Assets or the Retained Assets (including, without
         limitation, the presence of Hazardous Substances on, under, about or
         migrating to or from the Assets or the Retained Assets or the disposal
         or release of Hazardous Substances generated by operation of the Assets
         or the Retained Assets at non-Asset locations) 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;




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but only to the extent that such violation complained of under Section 3.1(a)(i)
or such events or conditions included under Section 3.1(a)(ii) occurred before
the Closing Date and only to the extent that a written notice of such violation,
event or condition is given to MRMC by the Partnership within five years
following the Closing Date (collectively, "Covered Environmental Losses"). In no
event shall the aggregate liability of MRMC pursuant to this Section 3.1(a)
exceed $7,500,000.

             (b) MRMC shall indemnify, defend and hold harmless any of the
Partnership Entities from and against any Losses suffered or incurred by any of
the Partnership Entities to the extent that MRMC is entitled to and receives
indemnification, is defended or held harmless against any such Losses from any
third-party pursuant to any agreement between any third-party and MRMC
(collectively, "Pass-Through Environmental Losses"). In furtherance of such
agreement, MRMC agrees to use its best commercially reasonable efforts to
pursue, for the benefit of the Partnership Entities, any such indemnification
with respect to which it might be entitled if requested by the Partnership;
provided that, the Partnership shall reimburse MRMC for all costs and expenses
incurred in connection with pursuing such indemnity on behalf of the
Partnership.

             (c) The Partnership shall indemnify, defend and hold harmless MRMC
from and against Losses suffered or incurred by any of the MRMC Entities by
reason of or arising out of:

                  (i) any violation or correction of violation of Environmental
         Laws associated with the Assets, or

                  (ii) any event or condition associated with ownership or
         operation of the Assets (including, but not limited to, the presence of
         Hazardous Substances on, under, about or migrating to or from the
         Assets or the disposal or release of Hazardous Substances generated by
         operation of the Assets at non-Asset locations) 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;

and regardless of whether such violation complained of under Section 3.1(c)(i)
or such events or conditions included under Section 3.1(c)(ii) occurred before
or after the Closing Date, except to the extent that any of the foregoing are
Covered Environmental Losses or Pass-Through Environmental Losses for which the
Partnership Entities are entitled to indemnification from MRMC under this
Article III.

         3.2 Additional Indemnification

             (a) In addition to and not in limitation of the indemnification
provided under Sections 3.1(a), 3.1(b) and 5.5, MRMC shall indemnify, defend,
and hold harmless the




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Partnership Entities from and against any Losses suffered or incurred by the
Partnership Entities by reason of or arising out of:

                  (i) any events and conditions associated with the ownership or
         operation of the Retained Assets, whether occurring before or after the
         Closing Date,

                  (ii) the failure of the Partnership Entities to be the owner
         of such valid leasehold interests or fee ownership interests in and to
         the Assets as are necessary to enable the Partnership Entities to
         continue to own and operate the Assets and the Business in the same
         manner that the Assets and the Business were owned and operated by the
         MRMC Entities during the one-year period immediately prior to the
         Closing date to the extent that MRMC is notified of any of the
         foregoing within four years after the Closing Date,

                  (iii) the failure of the Partnership Entities to have any
         consent or permit necessary to allow the Partnership Entities to own or
         operate the Assets and the Business in the same manner that the Assets
         and the Business were owned and operated by the MRMC Entities during
         the one-year period immediately prior to the Closing date to the extent
         that MRMC is notified of any of the foregoing within three years after
         the Closing Date,

                  (iv) the currently pending legal actions against MRMC set
         forth on Schedule 3.2 hereto, and

                  (v) all federal, state and local income tax liabilities
         attributable to the operation of the Assets prior to the Closing Date,
         including any such income tax liabilities of MRMC that may result from
         the consummation of the transactions contemplated by the Contribution
         Agreement.

             (b) In addition to and not in limitation of the indemnification
provided under Sections 3.1(c) and 5.5, or under the Partnership Agreement, the
Partnership shall indemnify, defend, and hold harmless the MRMC Entities from
and against any Losses suffered or incurred by any of the MRMC Entities by
reason of or arising out of events and conditions associated with:

                  (i) the operation of the Assets and the Business, and

                  (ii) the performance of the Services by MRMC and/or its
         employees pursuant to this Agreement (provided that MRMC is not in
         breach of this Agreement),

in each case occurring on or after the Closing Date (other than Covered
Environmental Losses which are provided for under Section 3.1), unless in any
such case such indemnification would not be permitted under Section 7.7 of the
Partnership Agreement.

         3.3 INDEMNIFICATION PROCEDURES.

             (a) The Indemnified Party agrees that within a reasonable period of
time after it becomes aware of facts giving rise to a claim for indemnification
under this Article III, it will




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provide notice thereof in writing to the Indemnifying Party, specifying the
nature of and specific basis for such claim.

             (b) 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 Article III, 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.

             (c) 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 Article III, 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. In no event shall the obligation of the 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 Article III; 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 reasonably informed as to
the status of any such defense, but the Indemnifying Party shall have the right
to retain sole control over such defense.

             (d) In determining the amount of any Losses for which the
Indemnified Party is entitled to indemnification under this Agreement, the gross
amount of the indemnification will be reduced by (i) any insurance proceeds
realized or to be realized by the Indemnified Party, and such correlative
insurance benefit shall be net of any incremental insurance premium that becomes
due and payable by the Indemnified Party as a result of such claim and (ii) all
amounts recovered or recoverable by the Indemnified Party under contractual
indemnities from third parties.

                                   ARTICLE IV
                     SERVICES AND RELATED PARTY TRANSACTIONS

         4.1 SERVICES. During the term of this Agreement, MRMC agrees to provide
(either directly or through its Subsidiaries) on behalf of the General Partner
in accordance with Article VII of the Partnership Agreement, the employees or
independent contractors, corporate staff, support services and administrative
services necessary to operate the Business (the "Services"). MRMC shall perform
the Services in a manner that is substantially identical in nature and quality
to the services performed by MRMC for the Business during the one-year period
immediately




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prior to the Closing Date. The General Partner and the Partnership agree that
MRMC shall be reimbursed for all costs and expenses incurred in connection with
the performance of the Services as if it were the General Partner in accordance
with Section 7.4(b) and 7.6(c) of the Partnership Agreement, subject to the
limitations set forth in Section 4.2 of this Agreement.

         4.2 GENERAL AND ADMINISTRATIVE REIMBURSEMENT.

             (a) Except as provided in Section 4.2(b) below, the amount for
which MRMC shall be entitled to reimbursement from the Partnership pursuant to
the last sentence of Section 4.1 for Allocated General and Administrative
Expenses shall not exceed $1.0 million in the aggregate in the first year
following the date of this Agreement (the "Indirect Expenses Limit). Thereafter,
the Indirect Expenses Limit shall be increased annually by no more than the
percentage increase in the Consumer Price Index for the applicable year.
Additionally, MRMC and the General Partner may agree, with the consent of the
Conflicts Committee, to further increases to the Indirect Expenses Limit in
order to account for adjustments in the nature of the Services as the result of
acquisitions by the Partnership or other expansions of the Business.

             (b) Notwithstanding Section 4.2(a), the Indirect Expenses Limit
will not apply to (i) the cost of any third party legal, accounting or advisory
services received, or the direct expenses of MRMC incurred in connection with
acquisition or business development opportunities evaluated on behalf of the
Partnership; or (ii) expenses directly attributable to the operation of the
Partnership, its assets or the Business.

         4.3 DESIGNATION OF AGENTS. In connection with the provision of the
Services by the employees of MRMC, the General Partner, on behalf of the
Partnership, hereby appoints and empowers MRMC and each current and future
employee of MRMC who is fulfilling a job function for the Partnership in
connection with the conduct by the Partnership of its business in the ordinary
course, as agent of the Partnership with full power and authority to execute and
deliver on behalf of the Partnership, any documents, contracts, governmental
filings or other instruments commensurate with, but limited to, such job
function. The power and authority granted pursuant to this Section 4.3 to a
person described in the preceding sentence will be valid only for so long as
such person is employed by MRMC.

         4.4 RIGHT TO OPERATE. MRMC shall have the right, but not the
obligation, to act as operator of the Partnership's facilities to the same
extent it acted as operator of such facilities prior to the effective date of
this Agreement for so long as MRMC has responsibilities associated with such
facilities.

         4.5 RELATED PARTY TRANSACTIONS. Each of MRMC, the General Partner, the
Partnership and the Operating Partnership agree that the execution or material
amendment of any "significant Martin agreement" (as such term is defined below)
must be approved by the Conflicts Committee. The term "significant Martin
agreement" means any agreement between the General Partner, the Partnership or
the Operating Partnership, on the one hand, and any Martin Entity, on the other
hand, that requires aggregate annual payments to or from any Martin Entity or
Martin Entities in excess of the Indirect Expense Limit.





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                                   ARTICLE V
                           USE OF THE NAMES AND MARKS

         5.1 GRANT OF LICENSE. MRMC hereby grants to the Partnership and the
Partnership hereby accepts, a nontransferable, nonexclusive royalty-free right
and license to use the Names and Marks in connection with the Business during
the term of this Agreement.

         5.2 USE. All use of and reference to the Names and Marks by the
Partnership shall be generally approved by MRMC prior to such use or reference,
and all such use and reference shall conform with such instructions and quality
standards as MRMC from time to time may issue. MRMC shall have 30 days from the
submission of approval to approve or disapprove of the use or reference. Failure
on the part of MRMC to act within such 30-day period shall be deemed to
constitute approval. In no event shall use of or reference to the Names and
Marks be inconsistent in form or content with the sole ownership of the Names
and Marks by MRMC. All use of the Names and Marks by the Partnership, its
agents, servants, employees and vendees, shall inure solely to the benefit of
MRMC. MRMC shall have the right to make reasonable inspection of the
Partnership's services rendered in connection with the Names and Marks to
protect the goodwill of MRMC associated with the Names and Marks.

         5.3 VARIATIONS. The Partnership shall not adopt and commence using any
variations of the Names and Marks, or any other names and marks confusingly
similar thereto, without the prior approval of MRMC. MRMC shall have 30 days
from the submission of approval to approve or disapprove of the variation.
Failure on the part of MRMC to act within such 30-day period shall be deemed to
constitute approval.

         5.4 NONTRANSFERABLE. The license granted to the Partnership to use the
Names and Marks is not assignable or transferable, and it shall not inure to the
benefit of any other Person, including, without limitation, a trustee in
bankruptcy or any other successor to the Partnership, whether by operation of
law or otherwise; provided, however, that the Partnership shall be entitled to
sublicense the Names and Marks to any of its Subsidiaries.

         5.5 INDEMNITY. The Partnership agrees to be solely responsible for and
to defend and indemnify MRMC from and against any and all claims, demands and
causes of action, and all Losses sustained in connection therewith, arising out
of, resulting from or related to the use of the Names and Marks in the Business,
even if such claim, demand or cause of action is based on the sole, partial or
concurrent negligence of MRMC, except that MRMC shall defend and indemnify the
Partnership from and against all claims, demands or causes of action for
trademark infringement arising from the use of the Names and Marks by the
Partnership. If requested by MRMC, the Partnership shall retain counsel
reasonably satisfactory to MRMC to represent MRMC, and the Partnership shall pay
the fees and expenses of such counsel relating to such claim, demand, or cause
of action. MRMC shall be consulted with respect to all matters concerning such
claim, demand, or cause of action, and settlement of such claim, demand, or
cause of action shall not be made without the prior written approval of MRMC.

         5.6 DISCLAIMER OF WARRANTIES. MRMC DISCLAIMS ANY AND ALL WARRANTIES,
CONDITIONS OR REPRESENTATIONS (EXPRESS OR IMPLIED, ORAL OR WRITTEN) WITH RESPECT
TO THE LICENSE IN THIS ARTICLE V, OR ANY PART



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THEREOF, INCLUDING ANY AND ALL IMPLIED WARRANTIES OF NON-INFRINGEMENT,
MERCHANTABILITY OR FITNESS OR SUITABILITY FOR ANY PURPOSE (WHETHER THE PARTY
KNOWS, HAS REASON TO KNOW, HAS BEEN ADVISED, OR IS OTHERWISE IN FACT AWARE OF
ANY SUCH PURPOSE) WHETHER ALLEGED TO ARISE BY LAW, BY REASON OF CUSTOM OR USAGE
IN THE TRADE OR BY COURSE OF DEALING.

                                   ARTICLE VI
                                  MISCELLANEOUS

         6.1 INSURANCE MATTERS. MRMC hereby agrees to cause each of the
Partnership Entities to be named as additional insureds in MRMC's current
insurance program, which is described on Schedule 6.1 attached hereto. Each of
the Partnership Entities shall pay for its allocated cost of that insurance
coverage in an amount equal to MRMC's cost of insuring the assets and operations
of Partnership Entity and generally in accordance with the allocations and
methodology described in Schedule 6.1.

         6.2 MANAGEMENT OF CF MARTIN.

             (a) Except as set forth below and to the extent allowed by
applicable law, MRMC agrees that it will, and (when applicable) it will use
commercially reasonable efforts to cause each of the MRMC Entities and each
Martin Manager to, exercise its J.V. Management Rights (as such term is defined
below) in a manner that it reasonably believes is in the best interests of the
Partnership. For purposes of this Agreement, the term "J.V. Management Rights"
shall mean the exercise by each of the Martin Entities or any Martin Manager of
any voting right or consent right granted by the CF Martin GP Agreement and the
CF Martin LP Agreement, including but not limited to, the exercise of rights
contained in Section 4.3 of the CF Martin LP Agreement (relating to
distributions by CF Martin) and Article X of the CF Martin LP Agreement
(relating to transfers). Notwithstanding anything to the contrary in this
Agreement, no Martin Manager shall be required to act in any manner that he or
she reasonably believes would (i) violate law, or (ii) constitute a breach of a
fiduciary or similar duty that such Martin Manager owes to CF Martin GP or CF
Martin, or any of its members or partners, respectively.

             (b) MRMC agrees to promptly provide the Partnership with a copy of
any notice it receives as a result of Article X of the CF Martin LP Agreement.

             (c) Except as provided for in this Section 6.2(c), MRMC agrees that
no member of the MRMC Group will either sell its Venture Interest, nor purchase
the Venture Interest of a third party, pursuant to Sections 10.1, 10.2, 10.5,
10.6 or 10.7 of the CF Martin LP Agreement without the written consent of the
Partnership. In addition, MRMC agrees that it will exercise its rights contained
in Section 10.2, 10.5, 10.6 or 10.7 of the CF Martin LP Agreement only as
directed by the Partnership. As between the MRMC Group and the Partnership, in
the event MRMC and the Partnership agree to purchase the Venture Interest of a
third party, the purchase price for and ownership of such Venture Interest shall
be allocated between the MRMC Group and the Partnership in accordance with their
respective ownership percentages in CF Martin and MRMC shall pay, or cause the
applicable MRMC Entity to pay, its proportionate share of the purchase price of
the Venture Interest to be purchased by MRMC or such MRMC




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<PAGE>
                                                                  EXECUTION COPY


Entity. Notwithstanding the foregoing, in no event will MRMC or any MRMC Entity
be prohibited by this Agreement from selling its Venture Interest when required
to do so by the terms of the CF Martin LP Agreement or the CF Martin GP
Agreement.

             (d) MRMC agrees that it will not, and it will cause each of the
MRMC Entities to not, vote in favor of or otherwise consent to any amendment of
the CF Martin LP Agreement without the prior written consent of the Partnership.

         6.3 CHOICE OF LAW; SUBMISSION TO JURISDICTION. This Agreement shall be
subject to and governed by the laws of the State of Texas, excluding any
conflicts-of-law rule or principle that might refer the construction or
interpretation of this Agreement to the laws of another state. Each Party hereby
submits to the jurisdiction of the state and federal courts in Dallas County,
Texas.

         6.4 NOTICE. All notices or requests or consents provided for by, or
permitted to be given pursuant to, this Agreement must be in writing and must be
given by depositing same in the United States mail, addressed to the Person to
be notified, postpaid, and registered or certified with return receipt requested
or by delivering such notice in person or by telecopier or telegram to such
Person. Notice given by personal delivery or mail shall be effective upon actual
receipt. Notice given by telegram or telecopier shall be effective upon actual
receipt if received during the recipient's normal business hours, or at the
beginning of the recipient's next business day after receipt if not received
during the recipient's normal business hours. All notices to be sent to a Party
pursuant to this Agreement shall be sent to or made at the address set forth
below such Party's signature to this Agreement, or at such other address as such
Party may stipulate to the other parties in the manner provided in this Section
6.4.

         6.5 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
of the Parties relating to the matters contained herein, superseding all prior
contracts or agreements, whether oral or written, relating to the matters
contained herein.

         6.6 TERMINATION. This Agreement, other than the provisions of Article
III, shall terminate if (i) the General Partner or any successor general partner
of the Partnership is not an Affiliate of MRMC or (ii) the Partnership Entities
no longer own and/or operate all or substantially all of the Assets or the
Business. Termination of this Agreement shall not terminate any Indemnifying
Party's continuing obligation of indemnification pursuant to Article III of this
Agreement which obligations shall survive as provided in Article III. In the
event of termination of this Agreement, the license granted by Article V hereof
shall automatically cease. As promptly as practicable (but in no event more than
180 days) following the termination of this Agreement, the Partnership shall
cease all use of the Names and Marks and any and all other names and marks
confusingly similar thereto. Termination of the license granted by Article V
hereof shall not terminate the Partnership's continuing obligation of
indemnification under Section 5.5 hereof. Upon termination of this Agreement,
MRMC shall have the right, but not the obligation, to continue as operator of
the Partnership's facilities to the same extent it acted as operator of such
facilities on behalf of the Partnership prior to the termination of this
Agreement for so long as MRMC has responsibilities associated with such
facilities, or the operation thereof.



                                       15
<PAGE>

                                                                  EXECUTION COPY

         6.7 EFFECT OF WAIVER OR CONSENT. No waiver or consent, express or
implied, by any Party to or of any breach or default by any Person in the
performance by such Person of its obligations hereunder shall be deemed or
construed to be a consent or waiver to or of any other breach or default in the
performance by such Person of the same or any other obligations of such Person
hereunder. Failure on the part of a Party to complain of any act of any Person
or to declare any Person in default, irrespective of how long such failure
continues, shall not constitute a waiver by such Party of its rights hereunder
until the applicable statute of limitations period has run.

         6.8 AMENDMENT OR MODIFICATION. This Agreement may be amended or
modified from time to time only by the written agreement of all the Parties
hereto; provided however, that the Partnership may not, without the prior
approval of the Conflicts Committee, agree to any amendment or modification of
this Agreement. Each such instrument shall be reduced to writing and shall be
designated on its face an "Amendment" or an "Addendum" to this Agreement.

         6.9 ASSIGNMENT. No Party shall have the right to assign its rights or
obligations under this Agreement without the consent of the other Parties
hereto.

         6.10 COUNTERPARTS. This Agreement may be executed in any number of
counterparts with the same effect as if all signatory parties had signed the
same document. All counterparts shall be construed together and shall constitute
one and the same instrument.

         6.11 SEVERABILITY. If any provision of this Agreement or the
application thereof to any Person or circumstance shall be held invalid or
unenforceable to any extent, the remainder of this Agreement and the application
of such provision to other Persons or circumstances shall not be affected
thereby and shall be enforced to the greatest extent permitted by law.

         6.12 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.

         6.13 LAWS AND REGULATIONS. Notwithstanding any provision of this
Agreement to the contrary, no Party this Agreement shall be required to take any
act, or fail to take any act, under this Agreement if the effect thereof would
be to cause such Party to be in violation of any applicable law, statute, rule
or regulation.

         6.14 NEGOTIATION OF RIGHTS OF LIMITED PARTNERS, ASSIGNEES, AND THIRD
PARTIES. The provisions of this Agreement are enforceable solely by the Parties
to this Agreement, and no limited partner, member, assignee or other Person of
the Partnership or General Partner shall have the right, separate and apart from
the Partnership or the General Partner, to enforce any provision of this
Agreement or to compel any Party to this Agreement to comply with the terms of
this Agreement.


                                       16
<PAGE>
                                                                  EXECUTION COPY



         IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on,
and effective as of, the date first written above.

                            MARTIN MIDSTREAM PARTNERS, L.P.

                            By: MARTIN MIDSTREAM GP L.L.C.,
                                On behalf of itself and on behalf of Partnership
                                    as its General Partner


                                    By:  /s/ Ruben S. Martin, III
                                         Ruben S. Martin, III
                                          President


                            MARTIN OPERATING PARTNERSHIP L.P.

                            By: Martin Operating GP LLC,
                                   its general partner;

                                 By: Martin Resource LLC,
                                        its sole member;

                                     By: Martin Resource Management
                                            Corporation,
                                            its sole member;


                                         By:   /s/ Ruben S. Martin, III
                                              Ruben S. Martin, III
                                               President



                            MARTIN RESOURCE MANAGEMENT
                              CORPORATION


                                    By: /s/ Ruben S. Martin, III
                                         Ruben S. Martin, III
                                          President




                                       17
<PAGE>
                                                                  EXECUTION COPY



                                   SCHEDULE 1

                              TRADENAMES AND LOGOS


                                    Attached



                                       18
<PAGE>
                                                                  EXECUTION COPY



                                 SCHEDULE 2.2(a)

                               RETAINED BUSINESSES

         The operations, assets and activities related to the businesses and
operations related to the business activities described on page 87 of the Martin
Midstream Partners, L.P. Prospectus, dated October 31, 2002.




                                       19
<PAGE>
                                                                  EXECUTION COPY



                                  SCHEDULE 3.2

                                   LITIGATION

         All pending legal actions existing as of the Closing Date.







                                       20
<PAGE>
                                                                  EXECUTION COPY



                                  SCHEDULE 6.1

                                INSURANCE PROGRAM

                                    Attached





                                       21





</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.4
<SEQUENCE>9
<FILENAME>d00990exv10w4.txt
<DESCRIPTION>MOTOR CARRIER AGREEMENT
<TEXT>
<PAGE>
                                                                    EXHIBIT 10.4


                             MOTOR CARRIER AGREEMENT


This MOTOR CARRIER AGREEMENT (hereinafter referred to as "Agreement") made as
the 1st day of November, 2002, between MARTIN OPERATING PARTNERSHIP L.P.
(hereinafter referred to as "SHIPPER"), a Delaware limited partnership, and
MARTIN TRANSPORT, INC. (hereinafter referred to as "CARRIER"), a Texas
corporation, for the interstate and unregulated intrastate transportation of
petroleum or other bulk liquid products (hereinafter referred to as
"COMMODITIES"), by tank truck, in the contiguous United States, shall be under
the terms and conditions hereinafter set forth. This Agreement shall be subject
to amendment and/or modification by Addendum hereafter executed by both SHIPPER
and CARRIER and attached hereto and made a part hereof.

1.       AGREEMENT

         A.       General: CARRIER agrees to accept interstate and unregulated
                  intrastate lawful shipments of the subject COMMODITIES
                  tendered to it by SHIPPER, pursuant to this Agreement and to
                  transport such COMMODITIES to the destination or destinations
                  designated by SHIPPER, provided such points of origin and
                  destination are within the scope of CARRIER's operating
                  authority subject to the rates and provisions of the
                  applicable Schedule of Actual Rates and Charges as provided in
                  the Addendum and Exhibit A, which are attached hereto and made
                  a part hereof.

         B.       Licenses, Laws and Regulations: CARRIER, at its sole cost, and
                  expense, shall procure and maintain all licenses and permits
                  required by local, state, or federal authorities with respect
                  to the transportation and related services rendered hereunder
                  and shall comply with all applicable laws and regulations
                  pertaining to such transportation and services.

2.       EFFECTIVE DATE AND TERM

                  The initial term of this Agreement shall be effective for a
                  three year period beginning on the commencement date (as
                  herein defined) and shall continue in effect thereafter on an
                  annual basis, until canceled by either party upon thirty (30)
                  days prior written notice to the other party. For the purposes
                  of this Agreement, the "commencement date" shall be November
                  1, 2002.

3.       EQUIPMENT

                  CARRIER shall provide all equipment necessary to perform the
                  transportation required hereunder, which equipment shall: (i)
                  be suitable for particular transportation required, (ii)
                  include any special equipment that is requested by SHIPPER and
                  agreed to by CARRIER when the shipping order is placed, and
                  (iii) comply with the specifications for equipment for such
                  transportation prescribed by any applicable governmental
                  regulations (including those of the United States Department
                  of Transportation). CARRIER shall maintain, and at all times
                  make available to SHIPPER, sufficient suitable equipment to
                  transport SHIPPER'S COMMODITIES.



                                       1
<PAGE>


4.       CARRIER'S PERFORMANCE

         A.       General: CARRIER agrees to accept from SHIPPER, and provide
                  transportation services for all COMMODITIES required by
                  SHIPPER, during each annual period of the initial term of this
                  agreement. All transportation hereunder shall be performed:
                  (i) at Carrier's sole expense, (ii) to the best of CARRIER's
                  knowledge, in full compliance with all applicable governmental
                  laws, ordinances, regulations, orders licenses, permits, and
                  all requirements of CARRIER's insurance, and (iii) with
                  maximum dispatch consistent with the CARRIER's best judgment
                  as to safety and efficiency, except as is specifically
                  provided to the contrary elsewhere in this Agreement.

         B.       Services: It is understood that the CARRIER shall secure the
                  services of, supervise and be responsible for all persons
                  operating trucking equipment hereunder and CARRIER shall hold
                  SHIPPER harmless from any claim, except for SHIPPER
                  negligence, including fees in defense thereof, by drivers for
                  wages, industrial accidents, workers compensation, withholding
                  and unemployment taxes, or any other actions arising from the
                  performance of this contract which shall be subject to Section
                  8(C) below.

         C.       Drivers: CARRIER's drivers shall comply with all reasonable
                  operational procedures requested by SHIPPER. CARRIER's drivers
                  shall promptly report all commodity spills, shortages (less
                  routine heels) or accidents which occur in the course of the
                  performance of this Agreement. In the interest of safety,
                  CARRIER's drivers shall not unload COMMODITIES until the
                  SHIPPER, its agents or employees shall have inspected the
                  shipping orders and have directed the driver to and specified
                  the proper unloading facilities.

5.       SHIPPER'S PERFORMANCE

         A.       Minimum Amount: SHIPPER agrees, during each annual period of
                  the initial term of this Agreement, to offer for shipment, a
                  minimum of one thousand (1000) tons of COMMODITIES. It is
                  understood by CARRIER that the minimum tonnage designation is
                  for planning purposes only and is not intended as a "take or
                  pay" commitment by SHIPPER.

         B.       Payment: CARRIER shall bill SHIPPER for the freight charges on
                  all shipments as soon after delivery of such shipments as
                  sufficient information is received to prepare such invoices.
                  All invoices for linehaul expenses are to be paid in full
                  within ten (10) days of receipt by SHIPPER of CARRIER's
                  invoice or such other notification as is mutually agreeable to
                  the parties. Payments to CARRIER by SHIPPER hereunder shall be
                  sent to the following address:

                           Martin Transport, Inc.
                           P. O. Box 191
                           Kilgore, Texas  75663





                                       2
<PAGE>

6.       COMPUTATION OF CHARGES

         Freight charges shall be computed on the actual basis of the rates
         provided in the applicable Schedule of Actual Rates and Charges set
         forth on Exhibit A attached hereto, subject to the terms and conditions
         contained therein.

7.       TERMINATION

         A.       Non-performance: In the event of non-performance by SHIPPER or
                  CARRIER, as the case may be, of any of the obligations
                  contained in the Agreement, SHIPPER or CARRIER as the
                  complaining party shall provide written notice of such
                  non-performance to the other party. The non-performing party
                  shall then have (14) days from the date of such notice within
                  which to remedy the non-performance. Thereafter, if the
                  non-performance remains uncorrected or if an acceptable remedy
                  is not reached within fourteen (14) days of such notice, the
                  complaining party may terminate this Agreement at any time
                  upon giving the non-performing party seven (7) days prior
                  written notice. If this Agreement is terminated in accordance
                  with this subsection, all obligations of the parties, as
                  contained in this Agreement and the Addendum and Exhibits
                  hereto, shall be terminated; provided, SHIPPER shall continue
                  to be responsible for all sums due to CARRIER for services
                  received prior to the date of termination.

         B.       Default or Insolvency: If a petition in bankruptcy should be
                  filed by CARRIER, or if CARRIER should be adjudicated as
                  bankrupt, or if CARRIER should make a general assignment for
                  the benefit of creditors, or if a receiver should be appointed
                  on account of the insolvency of CARRIER, SHIPPER may, without
                  prejudice to any other right of remedy, terminate this
                  Agreement upon giving CARRIER at least five (5) days prior
                  written notice to such termination. CARRIER shall have the
                  same rights as SHIPPER under this item.

8.       INSURANCE AND INDEMNITY

         A.       Liability: CARRIER shall be responsible for any loss, damage
                  or destruction of shipments tendered to it by SHIPPER from the
                  time such shipments are loaded at the delivery point until
                  accepted by SHIPPER as evidenced by unloading at destination
                  point. CARRIER shall reimburse SHIPPER for loss, damage or
                  injury to the COMMODITIES except when such loss, damage or
                  injury is caused by the wrongful act or negligence of SHIPPER,
                  its agents or employees in which case SHIPPER, its agents or
                  employees shall bear it's proportionate share of
                  responsibility for all loss, damage or injury and all
                  consequential and incidental damages related thereto.

         B.       Insurance: CARRIER shall maintain at all times Worker's
                  Compensation Insurance fully complying with the law of every
                  jurisdiction to which CARRIER is subject, Employer's Liability
                  Insurance in amounts not less than $250,000 and automotive and
                  general public liability insurance against injury or death in
                  amounts of not less than $3,000,000 for any one person and
                  $10,000,000 for any one accident or occurrence and against
                  property damage in amounts not less than $250,000 for any one
                  accident or occurrence. All liability insurance policies
                  obtained or maintained by CARRIER to meet the requirements of
                  this Agreement shall name SHIPPER as an additional insured as
                  to the operations of CARRIER under this Agreement and shall
                  contain severability of interests provisions. Promptly after
                  execution of this Agreement, CARRIER shall furnish SHIPPER
                  properly executed certificates of insurance evidencing that
                  the insurance






                                       3
<PAGE>

                  coverages and limits required by this Agreement are in effect.
                  If any insurance provided pursuant to this Agreement expires
                  during the term of the Agreement, renewal certificates of
                  insurance shall be furnished by CARRIER to SHIPPER 30 days
                  prior to the date of expiration. In addition, certified, true
                  and exact copies of all insurance policies required under this
                  Agreement shall be provided to SHIPPER by CARRIER, on timely
                  basis if requested by SHIPPER. All such certificates and
                  policies shall contain provisions that thirty (30) days'
                  written notice by registered or certified mail shall be given
                  the SHIPPER of any cancellation, intent not to renew, or
                  reduction in the policies' coverages, except in the
                  application of the aggregate limits provisions. CARRIER or any
                  party liable on accounts of loss of or damage to any of said
                  transported COMMODITIES shall have the full benefit of any
                  insurance that may have been effected upon or on account of
                  said COMMODITIES, insofar as this shall not void the contracts
                  or policies of insurance. CARRIER shall not be obligated to
                  reimburse the claimant for any premium paid therein.

         C.       Indemnity: CARRIER shall be responsible for, and shall
                  indemnify, defend and save harmless SHIPPER and its owned,
                  controlled, affiliated, subsidiary, associated, interrelated
                  and operated companies and the stockholders, directors,
                  officers, agents, employees and representatives of each from
                  and against, any and all claims, demands and causes of action
                  brought by any and all persons, including without limitation,
                  CARRIER's officers, agents, employees, representatives, or
                  subcontractors or any third parties, and against any and all
                  judgments in respect thereto on account of personal injury or
                  death or on account of property damage or destruction or loss
                  arising out of the negligence or willful misconduct of
                  CARRIER, its officers, employees, agents, representatives and
                  subcontractors.

                  SHIPPER shall be responsible for, and shall indemnify, defend
                  and save harmless CARRIER and its owned, controlled,
                  affiliated, subsidiary, associated, interrelated and operated
                  companies and the stockholders, directors, officers, agents,
                  employees and representatives of such from and against, any
                  and all claims, demands and causes of action brought by any
                  and all persons, including without limitation, SHIPPER's
                  officers, agents, employees, representatives, or
                  subcontractors or by any third parties, and against any and
                  all judgments in respect thereto on account of personal injury
                  or death or on account of property damage or destruction or
                  loss arising out of the negligence or willful misconduct of
                  SHIPPER, its officers, employees, agents, representatives and
                  subcontractors.

                  Where personal injury, death, or loss of or damage to property
                  is the result of the joint negligence or misconduct of CARRIER
                  and SHIPPER, each party's duty of indemnification shall be in
                  proportion to its allocable share of such joint negligence or
                  misconduct.

9.       FORCE MAJEURE

         Either CARRIER or SHIPPER shall be excused from performance of its
         obligations hereunder in the event and to the extent that such
         performance is delayed or prevented by any circumstances reasonably
         beyond its control, including by fire, explosion, interruption of raw
         materials, equipment source or fuel supply, strike or other labor
         dispute, riot or other civil disturbance, or act or omission of any
         governmental authority.





                                       4
<PAGE>

10.      LIMITATIONS OF LIABILITY

         CARRIER's obligations under this Agreement shall always be subject to
         any limitations imposed by applicable laws, regulations or other of any
         governmental authority. In no event shall CARRIER be responsible for
         any loss, damage, destruction or delay of shipments which occurs by
         reason of any act of God, terrorist attack, labor disturbance, strike,
         war, riot or civil disturbance, prohibition by government agency of the
         movement of goods or any other such similar causes which affect the
         obligations or performance of CARRIER, and CARRIER shall not be liable
         for any loss, damage, destruction or delay occurring while the
         COMMODITIES are stopped and held in transit upon the request of SHIPPER
         or from riots or strikes. CARRIER shall not be liable for delay causes
         by highway obstruction, faulty or impassible highway or lack of
         capacity on any highway, bridge or ferry.

11.      AGREEMENT CONCLUSIVE

         SHIPPER shall arrange for shipments to be tendered to CARRIER on a
         standard uniform bill of lading or other such document as may be
         mutually agreed to between CARRIER and SHIPPER, i.e., scale weight
         ticket, subject to the conditions of this Agreement and the attached
         Addendum or Exhibits. In the event there is a conflict between the
         terms of this Agreement and any schedule or bill of lading otherwise
         applicable to CARRIER and SHIPPER respecting the movements contemplated
         hereunder, the terms of this Agreement and the attached Addendum or
         Exhibits shall be construed as controlling the intent of the parties.

12.      ASSIGNMENT

         This Agreement and all Addends or Amendments hereto shall be binding
         upon and inure to the benefit of the successors of SHIPPER and CARRIER.
         Neither party may assign its rights under this Agreement without the
         non-assigning party's written approval. However, notwithstanding the
         above, the parties may assign their right, duties, obligations and
         interests in and to this Agreement to a parent, subsidiary, affiliate
         or sister corporation; provided, however, the parties shall not be
         thereby relieved of the responsibilities or obligations hereunder.

13.      CONFIDENTIALITY

         The terms of this Agreement shall be held in strict confidence by
         SHIPPER and CARRIER and shall not be disclosed to any third party,
         provided, however, SHIPPER shall have the right to disclose the terms
         to it's freight auditors, provide that a binding confidentiality
         agreement is continually maintained between SHIPPER and each such
         freight auditor.

14.      WAIVER

         Failure of either party to insist, in one or more instances, upon
         performance of any of the terms of this Agreement, or the waiver by
         either party of any term or right of the other party hereunder, will
         not be deemed or construed as a waiver or a relinquishment of any such
         term or right.




                                       5
<PAGE>

15.      APPLICABLE LAW

         This Agreement is to be construed in accordance with the laws of the
         State of Texas without giving effect to the principles of conflict
         laws. Any legal actions filed may be brought only to the state or
         federal courts in Texas.

16.      NOTICE

         Notice, as may be required hereunder, by either party of this Agreement
         to the other party shall be deemed to have been accomplished on date of
         delivery by the United States mail as evidenced by date of return
         receipt, when sent by certified mail, postage prepaid, to the following
         addresses:

         SHIPPER

         Martin Operating Partnership L.P.
         4200 Stone Road
         Kilgore, Texas  75662

         CARRIER

         Martin Transport, Inc.
         P. O. Box 191
         Kilgore, Texas  75663

17.      COMPLIANCE WITH NEGOTIATED RATES ACT OF 1993:

         CARRIER represents to SHIPPER that CARRIER has complied with (and will
         continue to comply with) all provisions of the Negotiated Rates Act of
         1993, including but not limited to Section 6 thereof. This Agreement
         provides service designed to meet the distinct needs of the SHIPPER,
         including price and service considerations tailored to the SHIPPER's
         needs.

18.      ENTIRE CONTRACT

         Except for the provisions of the schedules and Addenda or Amendments
         made a part hereof by reference, this instrument embodies the entire
         Agreement and understanding between SHIPPER and CARRIER as of the
         effective date of this Agreement, and there are no agreements,
         understandings, conditions, warranties or representations, oral of
         written, express or implied, with reference to the subject matter
         hereof that are not merged herein or superseded hereby as of the
         effective date of this Agreement. This Agreement may be modified only
         in writing signed by other parties.

19.      AUTHORITY

         Each party represents to the other that is has full authority and the
         necessary approval to enter into and perform this Agreement in
         accordance with its terms.



                                       6
<PAGE>


IN WITNESS THEREOF, the parties have caused this Agreement to be signed by their
duly authorized representatives.


<Table>
<S>                                                           <C>
MARTIN OPERATING PARTNERSHIP L.P.                             MARTIN TRANSPORT, INC.
(SHIPPER)                                                     (CARRIER)


BY:      Martin Operating GP LLC, its general                 BY: /s/ Ruben S. Martin, III
         partner
                                                              TITLE: President
         BY:      Martin Resource LLC, its sole
                  member                                      DATE: Nov. 1, 2002

                  BY:      Martin Resource Management         WITNESS: /s/ Chad Burkhardt
                           Corporation, its sole member

                           BY: /s/ Ruben S. Martin, III

                           NAME: Ruben S. Martin, III

                           TITLE: President

                           DATE: Nov. 1, 2002

                           WITNESS: /s/ Chad Burkhardt
</Table>




                                       7
<PAGE>


ADDENDUM TO MOTOR CARRIER AGREEMENT

CONTRACT SCHEDULE OF ACTUAL RATES AND CHARGES

Schedule of rates, charges, rules and other provisions (hereinafter referred to
as "Addendum") which govern that certain MOTOR CARRIER AGREEMENT (hereinafter
referred to as "Agreement"), dated the 1st day of November, 2002, to which this
Addendum is attached, by and between Martin Operating Partnership L.P.
(hereinafter referred to as "SHIPPER" and Martin Transport, Inc. (hereinafter
referred to as "CARRIER").

Except as otherwise specifically provided in this Addendum to the contrary, the
rates, rules and charges published in CARRIER's Rules and Regulations attached
as Exhibit B shall govern the transportation, by tank truck, in interstate and
unregulated intrastate commerce, of petroleum or other bulk liquid products
(hereinafter referred to as "COMMODITIES"), to and from points in the contiguous
United States. Reissues or revisions of the subject Rules and Regulations
subsequent to the date of this Agreement shall be applicable to this Agreement
and shall become a part hereof effective with the acceptance by SHIPPER of each
reissue or revision.

Each shipment tendered to CARRIER is deemed to be a tender to CARRIER as a
contract motor carrier and is subject to the terms, conditions and provisions of
this Agreement and to the provisions of law applicable to contract motor
carriage.

1.       RECEIPTS AND BILLS OF LADING

         Each shipment will be evidenced by a receipt in the form specified by
         SHIPPER and will be signed by CARRIER or CARRIER's agent or employee
         showing the kind and quantity of freight received by CARRIER at origin,
         but the absence or loss of any such receipt will not relieve CARRIER of
         its obligations and responsibilities with respect to any shipment made
         hereunder. If SHIPPER elects to use a bill of lading, manifest or other
         form of freight receipt or contract, that includes any terms,
         conditions and provisions that conflict with this Agreement, the terms
         and conditions of this Agreement will supersede. Upon delivery of each
         shipment made hereunder, CARRIER shall obtain a receipt, in a form
         specified or approved by SHIPPER, showing the kind and quantity of
         freight delivered to the CONSIGNEE of such shipment at the destination
         specified by SHIPPER and the time of such delivery, and CARRIER shall
         cause such receipt to be signed by such receiving personnel or by such
         agent or employee at such destination.

2.       RATES AND CHARGES

         Applicable Rates: Exhibit A affixed hereto and made a part hereof
         specifies the rates applicable to shipments by tank truck of
         "COMMODITIES" hereunder.

3.       DUTIES OF CARRIER AT DESTINATION

         Drivers and employees, agents, contractors or subcontractors of
         CARRIERS shall, during loading and unloading and at all times while on
         the premises of SHIPPER, consignor or consignee, comply with all safety
         laws, regulations and rules applicable to the facility, and of which it
         has actual or constructive knowledge, including but not limited to
         vacating the vehicles during loading and unloading and remaining in
         assigned areas.



                                       8
<PAGE>



4.       DELIVERY

         A.       Shipments Not Delivered.

                  i.       Any shipment or part thereof which for any reason is
                           refused, rejected or otherwise not accepted, received
                           or claimed shall be held by CARRIER for further
                           instructions from SHIPPER.

                  ii.      In such event, CARRIER shall contact SHIPPER and
                           request further transportation instructions,
                           including the location for delivery and the desired
                           delivery time.

                  iii.     The freight charges for any further movement for a
                           shipment not delivered shall be computed in
                           accordance with the CARRIER's Rules and Regulations
                           or jointly agreed to freight charges.

         B.       Shipment Delivery: Unless instructed otherwise by SHIPPER,
                  CARRIER shall connect product hose to trailer discharges
                  outlet, operate equipment on trailer to discharge product, and
                  remain in immediate attendance of trailer during product
                  off-loading procedure.

5.       SPECIAL SERVICES

         Safety Equipment: Safety equipment which is utilized or worn by drivers
         or which is required by law or reasonably necessary or desirable for
         the safe transportation, delivery, loading, or unloading of transported
         "COMMODITIES" shall be the responsibility of, and provided by CARRIER
         at no charge to SHIPPER.

6.       EQUIPMENT

         A.       Inspection: CARRIER's equipment offered to SHIPPER for loading
                  of the "COMMODITIES" to be transported is subject to
                  inspection for suitability and cleanliness by SHIPPER at
                  SHIPPER's discretion. The cleanliness or suitability of
                  equipment shall meet SHIPPER's standards of acceptability and
                  SHIPPER shall have the right to reject such equipment for
                  loading and require CARRIER to comply with SHIPPER's standard.
                  SHIPPER's standards shall be reasonable and conform to others
                  in the industry.

         B.       Lead Time: CARRIER shall provide all requested transportation
                  services, provided CARRIER has received notice at least
                  twenty-four (24) hours prior to the time which the services
                  are requested.

7.       MISCELLANEOUS

         In the performance of transportation service hereunder, CARRIER shall
         be an independent contractor and not an agent or employee of SHIPPER
         and CARRIER agrees, at its expense, to furnish suitable equipment to
         transport the "COMMODITIES", tendered hereunder and to assume all costs
         and expenses incidental to the transportation of such "COMMODITIES",
         including, but not limited to, all costs and expenses incidental to or
         arising out of maintenance, repair or operation of equipment, labor,
         fuel supplies, insurance and/or accident.



                                       9
<PAGE>


The provisions of the Agreement shall, in the event of conflict with this
Addendum, control.


<Table>
<S>                                                             <C>
MARTIN OPERATING PARTNERSHIP  L.P.                              MARTIN TRANSPORT INC.
(SHIPPER)                                                       (CARRIER)

BY:      Martin Operating GP LLC, its general                   BY: Ruben S. Martin, III
         partner
                                                                TITLE: President
         BY:      Martin Resource LLC, its sole
                  member                                        DATE: Nov. 1, 2002

                  BY:      Martin Resource Management           WITNESS: /s/ Adam Gallegos
                           Corporation, its sole member

                           BY: /s/ Ruben S. Martin, III

                           NAME: Ruben S. Martin, III

                           TITLE: President

                           DATE: Nov. 1, 2002

                           WITNESS: /s/ Adam Gallegos
</Table>



                                       10
<PAGE>


                                    EXHIBIT A


The below rates are hereby adopted as the applicable charges as provided for in
this Agreement between the identified parties and is herein made a part of the
Agreement.






                                  MILEAGE SCALE
                                 TO BE PROVIDED












                                       11
<PAGE>




                        POINT TO POINT RATES WITHIN U.S.


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

Origin         Consignee         Destination         Miles         Rate





                                 TO BE PROVIDED













                                       12
<PAGE>
RATE ADJUSTMENTS

All rates as shown in this EXHIBIT A, are to remain in effect without change for
a period of one year from the "commencement date". Exceptions to this rate
provision will occur only when due to circumstances beyond the control of the
CARRIER, a cost item is imposed which would normally affect any similar private
trucking operation (an "Industry Cost Adjustment"). These items may be reflected
in, but not limited to, taxes on fuel, workers compensation tax increases, etc.

It is agreed between the parties that beginning with the second year a rate
adjustment will be implemented at least on an annual basis. Both parties
recognize that costs may change during the initial one-year period and agree to
fairly negotiate such rate changes. In the event that both parties cannot
satisfactorily agree on an appropriate annual rate adjustment within thirty (30)
days of each anniversary of the Agreement, then the cost item will be adjusted
in accordance with the following index.

         The Gross National Product (GNP) Implicit Price Deflator which is
         indexed quarterly and published by the U.S. Department of Commerce,
         Economic Statistical Administration, Bureau of Economic Analysis. The
         most recently published Implicit Price Deflator index as of the
         "commencement date" shall be the basis for all future rate adjustments.

Industry Cost Adjustments also carry forward in addition to annual rate
adjustments. Additionally, Industry Cost Adjustments will be made as required
during the term of the Agreement.

FUEL ADJUSTMENT CHARGES

Fuel adjustment shall be as shown in Attachment I.

INSURANCE SURCHARGES

Three percent (3%) of line haul charges to cover increased insurance cost due to
the events of September 11, 2001.

GENERAL CONDITIONS

Standard accessory charges shall be as shown in Attachment II.




                                       13

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.5
<SEQUENCE>10
<FILENAME>d00990exv10w5.txt
<DESCRIPTION>TERMINAL SERVICES AGREEMENT
<TEXT>
<PAGE>
                                                                    EXHIBIT 10.5


                           TERMINAL SERVICES AGREEMENT


          THIS TERMINAL SERVICES AGREEMENT is made and entered into as of the of
November 1, 2002 (the "Effective Date"), by and between MARTIN OPERATING
PARTNERSHIP L.P. (hereinafter referred to as "Owner"), and MARTIN GAS SALES LLC
(hereinafter referred to as "Customer").

WITNESSETH:

          WHEREAS, the Owner operates a marine terminal facility located 4118
Pendola Point Road in Tampa, Florida (the "Terminal Facility") under the terms
of that certain Agreement of Lease, dated December 16, 1976, between Owner, as
assignee, and the Tampa Port Authority (the "Port Authority Lease"); and

         WHEREAS, the Customer is in the petroleum products ("Products")
distribution business; and

          WHEREAS, it is the desire of the Owner and the Customer that the
Customer's Product be throughput at the Terminal Facility and that the Owner
provide unloading, handling, storage, out-loading and other terminal services
with respect to the Customer's Product at the Terminal Facility, all on the
terms and conditions hereinafter provided.

          NOW, THEREFORE, in consideration of the mutual covenants and
agreements contained herein, the Owner and the Customer agree that the Owner
shall provide the hereinafter described terminal services with respect to the
Customer's Product at the Terminal Facility, on the terms and conditions
hereinafter provided:

1. TERM OF AGREEMENT. The term of this Agreement shall begin on the Effective
Date and shall end on the third anniversary of the Effective Date. Thereafter,
the term shall automatically renew from year to year, unless either party gives
written notice at least thirty (30) days prior to the expiration of the
applicable term.

2. OWNER'S DUTIES. In consideration of the compensation provided in Section 3
hereof, the Owner shall provide the following services ("Customer Services') to
the Customer at the Terminal Facility:

         (a)     UNLOADING. HANDLING AND STORAGE SERVICES. The Customer shall
                 deliver Product (consisting of # 2 fuel oil) to the Terminal
                 Facility by marine vessel. All such deliveries shall fully
                 comply with the terms and conditions of the Port Authority
                 Lease. The Owner shall unload the Customer's Product from such
                 marine vessels in accordance with prevailing industry



<PAGE>

                  standards relating to the handling of petroleum products. The
                  Owner shall transfer the Product to, store the Product in, the
                  following storage tank at the Terminal Facility:

<Table>
<Caption>
                   TANK NUMBER                                 CAPACITY
                   -----------                                 --------

<S>                                                           <C>
                   Tank #5                                    80,000 barrels
</Table>

                  Tank #5 shall be reserved and dedicated at all times for the
                  exclusive use of Customer.

         (b)      OUT-LOADING SERVICES. The Customer's Product may be removed
                  from the Terminal Facility by marine vessel or truck. The
                  Owner shall provide all out-loading services necessary to
                  permit the Customer to transfer Product from the storage tanks
                  at the Terminal Facility to the Customer's designated trucks
                  or marine vessels for removal from the Terminal Facility.

         (c)      INVENTORY SERVICES. The Owner shall provide to the Customer
                  daily inventory reports of Customer's Product, containing
                  reports as to receipts and withdrawals of Customer Product,
                  and the balance as of the close of business of the immediately
                  preceding day.

3. OWNER'S COMPENSATION. For the terminal services performed by it hereunder,
the Owner shall receive the following compensation from the Customer:

         (a)      TANK LEASE FEE. The Customer shall pay the Owner the following
                  compensation for services (the "Tank Lease Fee"). This fee
                  shall be fixed during the first year of this Agreement and
                  thereafter adjusted according to Section 3(c) below:

<Table>
<Caption>
                                    TANK                                      LEASE FEE
                                    ----                                      ---------
<S>                                                                      <C>
                                    Tank #5                              $20,000.00 per month
</Table>

         (b)      WHARFAGE: DOCKAGE AND DEMURRAGE. The Tank Lease Fee does not
                  include wharfage fees to the Tampa Port Authority. The
                  Customer shall pay wharfage fees along with any other fees due
                  to or required by the Tampa Port Authority, including future
                  increases in the fees. Dock scheduling and usage shall also be
                  subject to the regulations of the Tampa Port Authority.

         (c)      TANK FEE ADJUSTMENTS. The Tank Lease Fee shall be adjusted
                  annually as follows. The Tank Lease Fee shall be adjusted
                  (both upward and downward as hereinafter provided) by a factor
                  equal to the increase or





<PAGE>

                  decrease, as the case may be, in the Consumer Price Index. The
                  adjustment shall be calculated annually in October of each
                  year, commencing in October 2003 based on Consumer Price Index
                  statistics for the two preceding Septembers. The adjustment
                  shall be calculated as follows: The Tank Lease Fee in effect
                  shall be multiplied by a factor equal to the amount of the
                  increase or decrease, as the case may be, in the Consumer
                  Price Index for the immediately preceding month of September,
                  over the Consumer Price Index for September of the preceding
                  year. For purposes hereof, the term "Consumer Price Index"
                  shall mean the "Consumer Price Index for Urban Wage Earners
                  and Clerical Workers (1967=100)" specified for "All Items.
                  United States" compiled by the Bureau of Labor Statistics of
                  the United States Department of Labor (the "Index"). In event
                  the Index shall be converted to a different standard reference
                  base or otherwise revised, the determination of the percentage
                  change shall be made with the use of such conversion factor,
                  formula or table for converting the Index as may be published
                  by the Bureau of Labor Statistics or, if said Bureau shall not
                  publish the same, then as shall be reasonably determined by
                  the parties.

4. TITLE TO PRODUCT. Title to all of the Customer's Product received, stored and
handled by the Owner at the Terminal Facility shall remain at all times in the
name of the Customer. The Customer agrees not to deliver for storage at the
Terminal Facility any Product which may not be lawfully stored on the premises
of the Terminal Facility or any Product injurious to the premises or facilities,
or which would render the facilities unfit, after cleaning, for the proper
storage of similar products, or Products.

5. ASSIGNMENT. Neither party shall assign this Agreement without the express
written consent of the other party.

6. FACILITY. TANK AND EQUIPMENT CONDITION. The Owner shall, at its sole cost and
expense, provide and maintain all handling and storage equipment and facilities
necessary to the performance of its services hereunder, including without
limitation the storage tank, in compliance with prevailing industry standards
and all applicable Laws (as such term is defined in Section 7 below) as they may
exist from time to time.

7. CUSTOMERS COMPLIANCE WITH LAWS. In the conduct of its business on the
premises of the Terminal Facility, the Customer shall comply in all material
respects with all federal, state and local laws, ordinances, decrees, orders,
regulations, permits or other requirements having the force of law (hereinafter,
the "Laws").

8. ENTIRE AGREEMENT AND AMENDMENT. This Terminal Services Agreement shall
constitute the entire agreement concerning the subject hereof between the
parties superseding all previous agreements, negotiations and representations
made prior or contemporaneous to the date hereof. This Agreement shall be
modified or amended





<PAGE>
only by written agreement executed by both parties hereto.

9. CONTROLLING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.

         EXECUTED as of the date first set forth above.

MARTIN GAS SALES LLC - FUEL OIL SALES

      BY:  MARTIN RESOURCE MANAGEMENT CORPORATION,
      ITS SOLE MEMBER

         BY: /s/ RUBEN S. MARTIN, III
         NAME: RUBEN S. MARTIN, III
         TITLE: PRESIDENT


MARTIN OPERATING PARTNERSHIP L.P.

BY:  MARTIN OPERATING GP LLC, ITS GENERAL PARTNER

         BY:  MARTIN RESOURCE LLC, ITS SOLE MEMBER

                  BY:  MARTIN RESOURCE MANAGEMENT CORPORATION,
                       ITS SOLE MEMBER

                           BY: /s/ RUBEN S. MARTIN, III
                           NAME: RUBEN S. MARTIN, III
                           TITLE: PRESIDENT






</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.6
<SEQUENCE>11
<FILENAME>d00990exv10w6.txt
<DESCRIPTION>THROUGHPUT AGREEMENT
<TEXT>
<PAGE>
                                                                    EXHIBIT 10.6


                              THROUGHPUT AGREEMENT


                  THIS THROUGHPUT AGREEMENT (the "Agreement") is made and
entered into as of the of November 1, 2002 (the "Effective Date"), by and
between MARTIN GAS SALES LLC (the "Owner"), and Martin Operating Partnership
L.P. (the "Customer").

                                   WITNESSETH:

                  WHEREAS, the Owner owns a liquefied petroleum gas ("LPG")
truck loading and unloading and pipeline distribution terminal facility located
at Mont Belvieu, Texas (the "Terminal Facility"); and

                  WHEREAS, the Customer is in the LPG products ("Products")
distribution business; and

                  WHEREAS, it is the desire of the Owner and the Customer that
the Customer be provided with sole access to and use of the Terminal Facility,
all on the terms and conditions hereinafter provided.

                  NOW, THEREFORE, in consideration of the mutual covenants and
agreements contained herein, the Owner and the Customer agree that the Owner
shall provide the Customer with sole access to and use of the Terminal Facility,
on the terms and conditions hereinafter provided:

                  1. TERM OF AGREEMENT. The term of this Agreement shall begin
on the Effective Date and shall end on the third anniversary of the Effective
Date. Thereafter, the term shall automatically renew from year to year, unless
either party gives written notice at least thirty (30) days prior to the
expiration of the applicable term.

                  2. OWNER'S DUTIES. In consideration of the compensation
provided in Section 3 hereof, the Owner shall provide Customer with sole access
to and use of the Terminal Facility.

                  3. OWNER'S COMPENSATION.

                           (a) For the sole access to and use of the Terminal
         Facility, the Owner shall receive total compensation of $400,000 per
         year ("Annual Compensation") subject to adjustment as set forth in
         subsection (b) below. The Customer shall remit payment for 1/12 of the
         Annual Compensation each month payable on the last day of the month.

                           (b) The Annual Compensation shall remain as stated in
         subsection (a) until the first anniversary of the Effective Date.
         Thereafter, the Annual Compensation shall be adjusted annually (both
         upward and downward as hereinafter provided) by a factor equal to the
         increase or decrease, as the case may be, in the Consumer Price Index.
         The adjustment shall be calculated annually in November of each year,
         commencing in






                                       1
<PAGE>

         November, 2003. The adjustment shall be calculated as follows: the
         Annual Fee in effect shall be multiplied by a factor equal to the
         amount of the increase or decrease, as the case may be, in the Consumer
         Price Index for the immediately preceding month of October, over the
         Consumer Price Index for October of the preceding year. For purposes
         hereof, the term "Consumer Price Index" shall mean the "Consumer Price
         Index for Urban Wage Earners and Clerical Workers (1967=100)" specified
         for "All Items. United States" compiled by the Bureau of Labor
         Statistics of the United States Department of Labor (the "Index"). In
         event the Index shall be converted to a different standard reference
         base or otherwise revised, the determination of the percentage change
         shall be made with the use of such conversion factor, formula or table
         for converting the Index as may be published by the Bureau of Labor
         Statistics or, if said Bureau shall not publish the same, then as shall
         be reasonably determined by the parties.

                  4. TITLE TO PRODUCT. Title to all of the Product received,
stored and handled at the Terminal Facility shall remain at all times in the
name of the Customer. The Customer agrees not to deliver for storage at the
Terminal Facility any Product which may not be lawfully stored on the premises
of the Terminal Facility or any Product injurious to the premises or facilities,
or which would render the facilities unfit, after cleaning, for the proper
storage of similar products, or Products.

                  5. ASSIGNMENT. Neither party shall assign this Agreement
without the express written consent of the other party.

                  6. FACILITY, TANK AND EQUIPMENT CONDITION. The Owner shall, at
its sole cost and expense, provide and maintain all handling and storage
equipment and facilities necessary to the performance of its services hereunder
in compliance with prevailing industry standards and all applicable Laws (as
such term is defined in Section 7 below) as they may exist from time to time.

                  7. CUSTOMERS COMPLIANCE WITH LAWS. In the conduct of its
business on the premises of the Terminal Facility, the Customer shall comply in
all material respects with all federal, state and local laws, ordinances,
decrees, orders, regulations, permits or other requirements having the force of
law (the "Laws").

                  8. ENTIRE AGREEMENT AND AMENDMENT. This Agreement shall
constitute the entire agreement concerning the subject hereof between the
parties superseding all previous agreements, negotiations and representations
made prior or contemporaneous to the date hereof. This Agreement shall be
modified or amended only by written agreement executed by both parties hereto.

                  9. CONTROLLING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas.





                                       2
<PAGE>

                  EXECUTED as of the date first set forth above.

                          MARTIN GAS SALES LLC

                          By: Martin Resource Management Corporation
                              Its Sole Member


                              By: /s/ Ruben S. Martin, III
                                  Name: Ruben S. Martin, III
                                  Title: President


                          MARTIN OPERATING PARTNERSHIP L.P.

                          By: MARTIN OPERATING GP LLC
                              Its General Partner

                              By: Martin Resource LLC
                                  Its Sole Member

                                  By: Martin Resource Management Corporation
                                      Its Sole Member


                                      By: /s/ Ruben S. Martin, III
                                          Name: Ruben S. Martin, III
                                          Title: President




                                       3

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.7
<SEQUENCE>12
<FILENAME>d00990exv10w7.txt
<DESCRIPTION>CONTRACT FOR MARINE TRANSPORTATION
<TEXT>
<PAGE>
                                                                    EXHIBIT 10.7


                       CONTRACT FOR MARINE TRANSPORTATION

Martin Operating Partnership L.P. (hereinafter called "Owner") agrees to provide
transportation services to Martin Resource Management Corporation and its
affiliates (hereinafter called "Charterer") in bulk on board its marine vessels,
under the following terms and conditions:

1.TERM                              This agreement shall have a three-year
                                    term, commencing on November 1, 2002 (the
                                    "Commencement Date"). Thereafter, the
                                    agreement shall automatically renew for
                                    successive one-year periods unless either
                                    party terminates this agreement by providing
                                    written notice of such termination to the
                                    other party at least 30 days prior to the
                                    expiration of the then-applicable term.

2. VESSELS SUBJECT TO
      THIS CONTRACT                 1)      M/V Dani Mayes,
                                    2)      M/V Joel Smith,
                                    3)      M/V Mary Edwards,
                                    4)      M/V Martin Challenger, and
                                    5)      barges associated with such vessels
                                            (collectively, such vessels and
                                            barges are referred to herein as the
                                            "Vessels").

                                    The Vessels shall be operated and equipped
                                    in compliance with applicable Coast Guard
                                    regulations.

3. SPOT CONTRACTS                   Owner and Charterer agree that the
                                    Charterer's use of the Vessels under this
                                    agreement will be on a spot-contract basis
                                    and based on the then-availability of the
                                    Vessels. Each individual use of a vessel
                                    shall be evidenced by a written agreement
                                    between the parties, which agreement will
                                    contain the following information:

                                    1)      The origination (load) and
                                            destination (discharge) ports.
                                    2)      The cargo to be transported.
                                    3)      The volume to be transported.
                                    4)      The shipping rate or rates.
                                    5)      The term of the contract.


4. RATES                            The parties agree that the rates and
                                    related terms charged by Owner to Charterer
                                    under any individual spot contract will be
                                    on then-applicable market terms.

5. MINIMUM USE                      Charterer agrees that for the initial
                                    three-year term of this agreement, it will
                                    execute enough spot contracts under this
                                    agreement so that owner receives the "Base
                                    Revenue Amount" (as such term is defined
                                    below) under this agreement during each
                                    12-month period following the Commencement
                                    Date. The term "Base Revenue Amount" means
                                    the difference of $5,600,000 minus all
                                    "Freight Revenue" (as defined below)
                                    received from third parties during the
                                    applicable 12-month period. The term
                                    "Freight Revenue" means any revenue
                                    generated from the sale of any services
                                    using the vessels, including revenues
                                    relating to freight charges, demurrage,
                                    charter hire, heating charges, fleeting
                                    charges, insurance surcharges, tanking
                                    cleaning charges, tankerman fees, port or
                                    harbor charges and similar charges. If Owner
                                    does not receive the Base Revenue Amount for
                                    any such 12-month




<PAGE>

                                    period, Charterer agrees to pay Owner any
                                    deficiency within 30 days following the
                                    applicable anniversary of the Commencement
                                    Date.

6. BARGE COVERAGE
      TERMS                         The "Barge Coverage Terms" attached hereto
                                    as Exhibit A to apply to this contract and
                                    are hereby incorporated herein by reference.



<Table>
<S>                                                     <C>
MARTIN OPERATING PARTNERSHIP L.P.                       MARTIN RESOURCE MANAGEMENT CORPORATION

   By: Martin Operating GP LLC, its general
       partner
       By: Martin Resource LLC, its sole member
           By: Martin Resource Management
               Corporation, its sole member

               By: /s/ Ruben S. Martin, III             By:  /s/ Ruben S. Martin, III
               Its:  President                          Its: President
               Ruben S. Martin, III                     Ruben S. Martin, III
</Table>


<PAGE>


                              BARGE COVERAGE TERMS

RIDER TO BE MADE A PART OF THE CONTRACT FOR MARINE TRANSPORTATION DATED [o]
BETWEEN OWNER AND CHARTERER.

         1. OFFHIRE. The Vessel shall be declared offhire in the event of any
delay in performance due to the inability to deliver full services as the result
of medical emergencies, groundings outside the channel markers, maintenance,
inspections, mechanical failures and breakdowns or time spent waiting on crew
readiness. During offhire periods all charges for the Vessel, including boat and
barges, shall cease. The Vessel shall not be considered offhire in the event of
navigational delays, including locking and docking, groundings within the
channel markers, or delays due to weather.

         2. INVOICING & PAYMENT. Owner shall receive payment for service
rendered with thirty (30) day invoice. All other rebillable items, including,
but not limited to, shifting invoices, fleeting invoices, shore tanker man
charges, fresh air apparatus rental and the like shall be due net upon receipt
and payable to Owner's designated bank.

         3. DEMISE OF CHARTER. The Master of a Vessel, although appointed by and
in the employ of the Owner and subject to the Owner's direction and control,
shall observe the orders of the Charterer in connection with the Charterer's
agencies, arrangements, and employment of the Vessel's services hereunder.
NOTHING IN THIS CLAUSE OR ELSEWHERE IN THIS AGREEMENT SHALL BE CONSTRUED AS
CREATING A DEMISE OF THE VESSEL TO CHARTERER OR AS VESTING CHARTERER WITH ANY
CONTROL OVER THE PHYSICAL OPERATION OR NAVIGATION OF THE VESSEL.

         4. POLLUTION PREVENTION. Owner will in the case of an escape or
discharge of oil or other product or threat of escape or discharge of oil or
other product from the Vessel into navigable waters of the United States in
which the Vessel is operating (whether or not caused by Vessel's negligence),
promptly undertake such measures as are reasonably necessary which may be
required by applicable laws, rules and regulations to prevent pollution damage
from thereby arising and to mitigate any such damage. If an escape of discharge
of oil or other product occurs from the Vessel into the navigable waters of the
United States or when an escape or discharge of oil or other products from the
Vessel causes or threatens to cause pollution damage, or when there is the
threat of an escape or discharge of oil (i.e., a grave and imminent danger of
the escape or discharge of oil which, if it occurred, would create a serious
danger of pollution damage), Charterer may at option, and upon notice to Owner
and on the conditions set forth herein below, undertake such measures as are
reasonably necessary to prevent or mitigate resulting pollution damages, unless
Owner promptly undertakes same. Charterer shall keep Owner advised of the
measure intended to be taken by it. Any of the aforementioned measures actually
taken by the Charterer shall be at Owner's expense (except to the extent that
such escape or discharge was caused or contributed to by Charterer). Provided
that if Owner believes that such measures should not be undertaken or should be
discontinued, Owner may so notify Charterer and thereafter Charterer, if it
elects to continue said cleanup measures, shall do so at its own risk and
expense.

         5. INDEMNITY. Owner covenants and agrees to fully defend, protect,
indemnify and hold harmless Charterer, its employees and agents from and against
each and every claim, demand or cause of action and any liability, cost, expense
(including, but not limited to, reasonable attorney's fees and expenses incurred
in the defense of Charterer), damage or loss in connection therewith, which may
be made or asserted by Owner, or Owner's employees or agents, subcontractors, or
any third parties including, but not limited to Charterer's agents, servants or
employees on account of personal injury or death or property damage to the
extent of Owner's negligence.

Charterer covenants and agrees to fully defend, protect, indemnify and hold
harmless, Owner, its employees and agents from and against each and every claim,
demand or cause of action and any liability, cost, expense (including, but not
limited to, reasonable attorney's fees and expenses incurred in the defense of
Owner), damage or loss in connection therewith, which may be made or asserted by
Charterer or Charterer's employees or agents, subcontractors, or any third
parties including, but not limited to Owner's




<PAGE>

agents, servants or employees on account of personal injury or death or property
damage to the extent of Charterer's negligence.

         6. ARBITRATION. Each party will select their own arbitrator. Then the
two arbitrators will select a third arbitrator. In the event these two
arbitrators cannot agree on a third arbitrator then a state district judge in
Gregg County, TX will select the third arbitrator.

         7. INSURANCE: Subject to availability to pollution bonds at
commercially acceptable rates and certificates of financial responsibility from
underwriters, during the period of this agreement, Owner shall make all
reasonable attempts to comply with all financial capability, responsibility,
security or like laws, regulations and/or requirements of whatsoever kind
relating to the Vessels with respect to oil and/or other pollution damage
applicable to the Vessel entering, leaving, remaining at or passing through any
ports or places or waters in the performance of this agreement. Subject as
aforesaid, Owner at its sole risk and expense shall make all reasonable attempts
to arrange by bond, insurance or otherwise and obtain all such certificates or
other documentary evidence and take all such other action, as may be necessary,
to satisfy such laws, regulations and/or other requirements. Owner warrants that
they have in place at the Commencement Date coverage for oil pollution of U.S.
$500,000,000.

Hull and Protection and Indemnity coverage shall be carried with first class
underwriter by Owner for Owner's account, with Charterer named as additional
assure. Owner shall also carry, at Owner's expense, American Club, or other
water pollution coverage, as required by law.

         8. COMPLIANCE: Upon delivery, Owner warrants that the Vessel will be in
compliance with all applicable government regulations.

         9. CHARTERER'S REPRESENTATIVES: Charterer's representatives may board
the Vessel at any convenient place to observe cargo-handling operations, to
inspect logs and certificates, and to confirm that Owner is fulfilling its
obligations under this agreement.

         10. OUTTURN: Any shortage in outturn (unless resulting from a condition
described in Force Majeure Clause above), in excess of one-half of one percent
(0.5%) in volume shall be for the account of Owner on an evaluation declared by
the Charterer at the time of discharging provided that Owner shall not be liable
for any shortage in outturn unless a comparison of barge ullage figures at
loading port and at discharge port established that a volume loss in excess of
one-half of one percent (0.5%) has actually occurred.

         11. DRUG & ALCOHOL ABUSE POLICY: Owner warrants that it has a policy on
Drug and Alcohol Abuse applicable to the Vessel which meets and exceeds the
standards set forth by the U.S. Coast Guard. Owner further warrants that this
Policy will remain in effect during the term of this agreement and Owner shall
exercise diligence to ensure that Policy is complied with.

         12. CONDITIONS OF EQUIPMENT: The Owner shall, before and at
commencement of each voyage, exercise due diligence to make the entire Vessel
seaworthy and in good operating condition, properly manned, equipped and
supplied for the voyage, and to make the pipes, pumps and coils tight, staunch,
strong and in every respect fit for the voyage, and to make the tanks and other
spaces in which cargo is to be carried fit and safe for its carriage and
preservation. Owner will provide, at the time of delivery and thereafter keep in
force during the period of this agreement, a valid and subsisting certificate or
other permit issued by the United States Coast Guard (or other governmental
bureau or department having jurisdiction thereof) approving the barges for the
transportation and carriage of inflammable liquids having a Reid Vapor Pressure
of less than fourteen (14) pounds per square inch. Owner warrants that the barge
is capable of discharging at a rate of twenty-five hundred (2,500) barrels per
hour or is able to maintain one hundred (100) PSI at the rail; otherwise, the
Vessel shall be considered off-hire for all excess pumping time.

         13. WHARFAGE AND DOCKAGE: Owner's equipment shall be free of wharfage
and dockage charges at loading and discharging ports.




<PAGE>

         14. SUBLET: Charterer has the right to sublet the Vessel for third
party work and act as deponent owner; however, Charterer shall always remain
responsible for the fulfillment of this agreement in all its terms and
conditions.

         15. GENERAL AVERAGE: Notwithstanding anything herein to the contrary,
in the event of accident, danger, damage or disaster before or after the
commencement of the voyage resulting from any cause whatsoever, whether due to
negligence or not, for which, or for the consequences of which, the Vessel
including her barge or barges, are not responsible by statute, contract, or
otherwise, the cargo and its barge, jointly and severally, shall contribute in
General Average to the payment of any sacrifices, losses or expenses of a
General Average nature that may be made or incurred, by a barge or its cargo,
and in a like manner, shall pay salvage and special charges incurred in respect
to the common safety of both cargo and its barge. If a salving vessel is owned
or operated by the Owner, salvage shall be paid for as fully as if the salving
vessels belong to strangers, General Average shall be adjusted, stated and
settled according to York-Antwerp Rules 1974, Excluding Rule XXII thereof, at
such port or place in the United States as may be selected by barge owners with
cargo owner's approval, and as to matters not provided for by the rules
mentioned, according to the laws and usages of the Port of New York.

         16. FORCE MAJEURE: The Vessel, its captain and Owner shall not, unless
otherwise in this agreement expressly provided, be responsible for any loss or
damage arising or resulting from: any act, default or barratry of the captain,
pilots, mariners, or other servants of the Owner in the navigation or management
of the vessel; fire, unless caused by the personal design or neglect of the
Owner; collision, stranding or peril, danger or accident of navigable waters;
saving or attempting to save life or property; wastage in weight or bulk, or any
other loss or damage arising from inherent defect, quality or vice of the cargo;
any act or omission of the Charterer, Owner, shipper or consignee of the cargo,
their agents or representatives; insufficiency or inadequacy of marks;
explosion, bursting of boilers, breakage of shafts, or any latent defect in
hull, equipment or machinery; unseaworthiness of the Vessel unless caused by
want or due diligence on the part of the Owner to make the Vessel seaworthy or
to have it properly manned, equipped and supplied; or from any other cause of
whatsoever kind arising without the actual fault of privity of the Owner. And
neither the Vessel, its captain or Owner, nor the Charterer, shall, unless
otherwise in this agreement expressly provided, be responsible for any loss or
damage or delay or failure in performing hereunder arising or resulting from;
act of God, act of war; act of public enemies, pirates or assailing thieves;
acts of terrorism; arrest or restraint of princes, rulers of people, or seizure
under legal process provided bond is promptly furnished to release the Vessel or
cargo; strike or lockout or stoppage or restraint of labor from whatever cause,
either partial or general, or riot or civil commotion.







</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.8
<SEQUENCE>13
<FILENAME>d00990exv10w8.txt
<DESCRIPTION>PRODUCT STORAGE AGREEMENT
<TEXT>
<PAGE>
                                                                    EXHIBIT 10.8


                            PRODUCT STORAGE AGREEMENT

                            ARCADIA STORAGE FACILITY


         THIS PRODUCT STORAGE AGREEMENT is entered into as of the 1st day of
November, 2002 ("Effective Date") by and between MARTIN UNDERGROUND STORAGE,
INC. ("LESSOR"), and MARTIN OPERATING PARTNERSHIP L.P., ("CUSTOMER"). The
parties agree to the following:

                                   WITNESSETH

         1. PRODUCT STORAGE. For and in consideration of the rates and fees to
be paid by CUSTOMER to LESSOR as provided herein and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
LESSOR hereby agrees to lease storage space at its underground storage facility
situated in Arcadia, Louisiana, for the storage of up to, but not to exceed, the
maximum quantity of propane specification product ("Product") set forth in
Exhibit "A" which is attached hereto and made a part hereof (the "Lease
Volume"). LESSOR represents and warrants that it has full right, power and
authority to extend and deliver the storage services described in this
Agreement. Each of the parties hereto represents and warrants that it has full
power and authority to make, enter and perform its obligations under this
Agreement.

         2. Definitions. For the purpose of this Agreement, the following terms
and expressions shall have the following meanings:

                   'AFFILIATE' means, of any Person, a Person Controlling,
         Controlled by or under common Control with, directly or indirectly,
         through one or more intermediaries, such Person. Any Person shall be
         deemed to be an Affiliate of any specified Person if such Person owns
         50% or more of the voting securities of the specified Person, if the
         specified Person owns fifty percent (500/o) or more of the voting
         securities of such Person, or if fifty percent (50~/o) or more of the
         voting securities of the specified Person and such Person are under
         common Control.

                   "AGREEMENT" shall mean this Product Storage Agreement.

                   "BARREL" shall mean forty-two (42) U. 5. Gallons.

                   "BASE RATE" shall have the meaning specified in Section 12
         hereinafter.

                   "BUSINESS DAY" shall mean a Day on which Federal Reserve
         member banks in Houston, Texas are open for business.

                   "CONTROL" of a non-natural Person means the power, directly
         or indirectly, to (i) elect, appoint or cause the election or
         appointment of at least a majority of the members of the board of
         directors of such Person (or if such Person is a noncorporate Person,
         Persons having similar powers), or (ii) direct or cause the direction
         of the management and policies of such Person, in






                                       1
<PAGE>
         either case through beneficial ownership of the capital stock (or
         similar ownership interests) of such Person or otherwise.

                  "DAY OR DAILY" shall mean a twenty-four (24) hour period
         commencing 12:01 a.m. local clock time, and extending until 12:00
         midnight local clock time.

                  "EFFECTIVE DATE" shall mean the date on which CUSTOMER may
         begin to store Products under this Agreement as set forth in Exhibit
         "A".

                  "FACILITIES" shall mean the underground storage facilities
         owned by LESSOR, at Arcadia, Louisiana, including, but not limited to,
         all storage caverns, related surface and subsurface equipment, and
         loading and unloading terminals.

                  "FORCE MAJEURE" shall have the meaning specified in Section 18
         hereinafter.

                  "GALLON" shall mean one U.S. Gallon, which is the unit of
         volume used for the purpose of measurement of liquid. One (1) U.S.
         liquid Gallon contains two hundred thirty-one (231) cubic inches when
         the liquid is at a temperature of sixty degrees Fahrenheit (600F) and
         at the Vapor pressure of the liquid being measured.

                  "LEASE VOLUME" shall have the meaning specified in Section 1
         above.

                  "MONTH" or "MONTHLY" shall mean a period commencing at 12:01
         a.m. local clock time on the first Day of a calendar Month and
         extending until 12:00 midnight local clock time on the last Day of the
         calendar Month.

                  "OFFSPEC PRODUCT" shall have the meaning specified in Section
         4 hereinafter.

                  "PERSON" means any individual, corporation, partnership,
         limited partnership, limited liability partnership, limited liability
         company (whether domestic or foreign), joint venture, association,
         joint-stock company, trust, estate, custodian, trustee, executor,
         administrator, nominee, entity in a representative capacity,
         unincorporated, organization, or governmental agency or authority.

                  "RECEIVING PIPELINE" shall have the meaning specified in
         Section 5 hereinafter.

                  "STORAGE RATE" shall have the meaning specified in Section
         11(a).

                  "YEAR" or "YEARLY" shall mean a period of 365 consecutive
         Days', provided, however that any Year which contains the date of
         February 29 shall consist of 366 consecutive Days.

         3. TERM. The term of this agreement shall commence on the Effective
Date and shall terminate as specified in Exhibit "A". Unless a new storage
agreement is entered into or this agreement is renewed, at the expiration or
termination of this Agreement, CUSTOMER shall remove all Products stored
hereunder






                                       2
<PAGE>

on or before the last Day of the term of this Agreement subject to the payment
of all accrued storage fees and other charges hereunder and LESSOR's lien as set
forth herein. In the event CUSTOMER fails to remove its Products at the
expiration of the term of this Agreement, LESSOR shall have the right to sell
all or any portion of such Products on terms and at such prices as LESSOR, in
its sole discretion, deems appropriate under the then existing circumstances. If
LESSOR sells all or a portion of CUSTOMER's Products under the terms of this
Section 3, within sixty (60) Days of its receipt of the proceeds derived from
the sale of such Products, LESSOR shall remit same to CUSTOMER less (i) all of
LESSOR'S costs and expenses associated with any such sales, (ii) a sales
commission equal to five percent (5%) of the gross proceeds of such sales, and
(iii) any fees then due and owing by CUSTOMER to LESSOR.

          4.      PRODUCT SPECIFICATIONS.

                   (a) All deliveries of Products by CUSTOMER hereunder shall
         meet LESSOR specifications for the type of Products stored, as such
         specifications may change from time to time, the most current of which
         are set forth in Exhibit "B" attached hereto and made a part hereof.
         LESSOR or its designee reserves the right to perform an analysis of
         CUSTOMER's Products prior to accepting same for storage, but assumes no
         responsibility for doing so, and may refuse to accept delivery of such
         Products if it is contaminated or otherwise fails to conform with the
         applicable specifications ("0ffspec Product"). If LESSOR accepts into
         storage Offspec Product delivered by or on behalf of CUSTOMER, CUSTOMER
         shall reimburse LESSOR for the reasonable costs and expenses incurred
         in handling such Offspec Product. CUSTOMER shall be bound by the
         testing results obtained from analysis of CUSTOMER's Products, if any,
         performed by or on behalf of LESSOR.

                   (b) CUSTOMER AGREES TO AND DOES INDEMNIFY FULLY AND HOLD
         HARMLESS LESSOR AND ITS PARENTS, SUBSIDIARIES AND AFFILIATES AND ITS
         AND THEIR AGENTS, OFFICERS, DIRECTORS, EMPLOYEES, REPRESENTATIVES,
         SUCCESSORS AND ASSIGNS FROM AND AGAINST ANY AND ALL LIABILITIES,
         LOSSES, DAMAGES, DEMANDS, CLAIMS, PENALTIES, FINES, ACTIONS, SUITS,
         LEGAL, ADMINISTRATIVE OR ARBITRATION OR ALTERNATIVE DISPUTE RESOLUTION
         PROCEEDINGS, JUDGMENTS, ORDERS, DIRECTIVES, INJUNCTIONS, DECREES OR
         AWARDS OF ANY JURISDICTION, COSTS AND EXPENSES (INCLUDING, BUT NOT
         LIMITED TO, ATTORNEYS' FEES AND RELATED COSTS) ARISING OUT OF OR IN ANY
         MANNER RELATED TO CUSTOMER DELIVERING OR CAUSING TO BE DELIVERED INTO
         LESSOR'S FACILITIES ANY OFFSPEC PRODUCTS.

          5.      PRODUCT DELIVERY AND REDELIVERIES.

         (a) LESSOR will not accept delivery of Propane that has been odorized.
CUSTOMER represents that it shall not tender for delivery and storage Propane
that has been odorized.

         (b) Products redelivered to CUSTOMER out of LESSOR'S Facilities will
only be made on the request of CUSTOMER's designated representative or duly
authorized agent. LESSOR will not recognize sales, assignments or transfers of
title to Products while in storage unless made in a manner approved by LESSOR in
advance and then only to another person or entity that has entered into a valid
storage





                                       3
<PAGE>

agreement with LESSOR. Products redelivered by LESSOR hereunder shall be
redelivered into any common carrier pipeline currently connected to LESSOR'S
Facilities or into tank trucks. LESSOR'S redelivery of Products to CUSTOMER
shall be subject to operating conditions, rates of delivery, delivery pressures,
scheduling, etc. of the pipeline in which CUSTOMER requests Products be
delivered into (the "Receiving Pipeline"). Custody of the Products delivered or
redelivered hereunder shall be deemed to be transferred at the pipeline
connection of the Receiving Pipeline, or the loading flange if loaded into tank
trucks, as applicable. CUSTOMER shall use its best efforts to give LESSOR
reasonable notice of deliveries or withdrawals of Products. LESSOR shall not be
required to receive or redeliver Products unless it has been given at least
fifteen (15) Days advance written notice of such Products delivery or
redelivery, but always subject to the physical capabilities of LESSOR'S
Facilities and other customers scheduled redeliveries. Measurement of Products
delivered or redelivered hereunder shall take place as near to the points of
delivery or redelivery as practicable to LESSOR and shall be made by LESSOR or
its designee in accordance with LESSOR'S or its designee's standard measurement
procedures and shall conform to good measurement practices in the industry. All
measurements made by LESSOR or its designee shall be binding on the parties
hereto unless proven to be in error. CUSTOMER shall have the right to witness
all such measurements. If deliveries of Products for storage are made by
CUSTOMER through the use of tank cars or trucks, LESSOR shall have the right to
prorate tank car or truck shipments in proportion to the Lease Volume for which
each CUSTOMER has contracted, if deemed necessary by LESSOR in its sole
discretion. Tank trucks will be handled on a first in first out basis. All tank
trucks shall be suitable for loading and unloading at LESSOR'S Facilities and
shall be certified as such by CUSTOMER as provided in Section 6 hereinafter.

         Any quantity of Propane taken by CUSTOMER in excess of CUSTOMER's
Propane storage balance will be considered as an unauthorized withdrawal of
Propane. CUSTOMER shall have five (5) days from unauthorized withdrawal to
restock the excess amount withdrawn. When LESSOR determines a CUSTOMER has
withdrawn unauthorized volumes, CUSTOMER will be prevented from further
withdrawals. Withdrawal privileges will be reinstated only after the CUSTOMER
re-stocks the excess withdrawal or paid for the excess withdrawal and CUSTOMER
has physical volumes in place to withdraw.

         6. PRORATION. LESSOR shall exercise its best efforts to withdraw and
deliver on any one-day the total of each CUSTOMER's requests for such day. If,
however, all of the withdrawal requests exceed the total volume which can
withdraw from storage and deliver, the Propane deliverable on each day shall be
prorated. Proration of withdrawals down the pipeline and proration of
withdrawals by transport truck will be handled as two separate allocations.

                   (a) Proration will be determined based on daily activity.
         Should proration become necessary, the customer will be notified
         twenty-four (24) hours in advance by phone and/or FAX.

                   (b) Proration will be based on the CUSTOMER's throughput
         during the previous twelve (12) months as a percentage of the total
         throughput. This percentage will then be applied to the total daily
         output capacity of the transport truck withdrawal facilities or the
         pipeline withdrawal facilities.




                                       4
<PAGE>

         7. TRANSPORTATION EQUIPMENT. CUSTOMER agrees that all trucks used by
CUSTOMER and third party carriers on CUSTOMER's behalf to make deliveries or
withdrawals at the Facilities shall meet or exceed all federal, state and
municipal safety, operating and insurance requirements and further agrees to
certify same and to provide copies of all government approvals to LESSOR or its
designee before the trucks will be accepted at LESSOR'S Facilities. CUSTOMER and
all third party carriers acting on behalf of CUSTOMER shall have executed a
Terminal Access Agreement before they will be allowed to enter the Facilities.

         8. STENCHING. LESSOR will odorize or cause to be odorized all shipments
of propane out of storage by tank truck in accordance with standard industry
practice (currently 1.5 pounds ethyl mercaptan per 10,000 Gallons), or as
required by governmental agencies having proper jurisdiction, and will odorize
shipments of other Products if requested in writing by CUSTOMER to do so.
CUSTOMER agrees to pay LESSOR for providing this odorization service the fees
set forth in Exhibit "A". CUSTOMER ACCEPTS ALL RESPONSIBILITY FOR IMPROPER
AMOUNTS OF MALODORANT SUBSEQUENT TO SHIPMENT, THE DISSIPATION OF MALODORANT OR
THE INTRODUCTION OF THE PROPER MALODORANT AND, WHERE LESSOR OR ITS DESIGNEE
PROVIDES DOCUMENTATION OF THE ODORIZATION REQUIRED BY THIS AGREEMENT, CUSTOMER
AGREES TO DEFEND, INDEMNIFY AND HOLD LESSOR AND ITS PARENTS, SUBSIDIARIES AND
AFFILIATES AND ITS AND THEIR AGENTS, OFFICERS, DIRECTORS, EMPLOYEES,
REPRESENTATIVES, SUCCESSORS AND ASSIGNS HARMLESS FROM ANY AND ALL LIABILITIES,
LOSSES, DAMAGES, DEMANDS, CLAIMS, PENALTIES, FINES, ACTIONS, SUITS, LEGAL,
ADMINISTRATIVE OR ARBITRATION OR ALTERNATIVE DISPUTE RESOLUTION PROCEEDINGS,
JUDGMENTS, ORDERS, DIRECTIVES, INJUNCTIONS, DECREES OR AWARDS OF ANY
JURISDICTION, COSTS AND EXPENSES (INCLUDING ATTORNEY'S FEES AND ANY COST OR
EXPENSE OF INCIDENT INVESTIGATION) OR ANY LIABILITY ARISING FROM ANY CLAIMS OF
WHATEVER KIND DUE TO INJURIES OR DAMAGES WHICH OCCUR AFTER DELIVERY TO CUSTOMER
AND ARISE IN CONNECTION WITH CUSTOMER'S OR ITS CUSTOMER'S TRANSPORTATION,
STORAGE, USE, HANDLING, OR RESALE OF PRODUCTS COVERED HEREUNDER. THIS
INDEMNIFICATION OBLIGATION INCLUDES AMONG ANY OTHER CLAIMS, THOSE COMPRISING
LACK OF OR INADEQUATE WARNING MATERIALS, IMPROPER AMOUNTS, USE OR TYPE OF
ODORANT, "ODORANT FADING," LACK OF WARNING ON SUPPLEMENTAL WARNING SYSTEMS (SUCH
AS GAS DETECTORS) AND IMPROPER TRAINING OR MONITORING OF CUSTOMER'S WARNING
AND/OR TRAINING PROGRAMS. CUSTOMER'S INDEMNITY OBLIGATION SHALL BE APPLICABLE
EVEN IF SUCH DAMAGES ARE DETERMINED TO HAVE BEEN PARTLY CAUSED BY THE FAULT OF
LESSOR OR IF LIABILITY WITHOUT FAULT IS IMPOSED ON LESSOR, THE ONLY EXCEPTION TO
SUCH OBLIGATION BEING WHERE THE FAULT OF LESSOR IS DETERMINED TO BE THE SOLE
CAUSE OF SUCH DAMAGES.

         9. LOSS ALLOWANCE. Due to normal operating losses which occur in
receiving Products for storage, storing such Products and redelivering Products
out of storage, CUSTOMER'S withdrawals from storage shall be limited to the
percent of the Products delivered to LESSOR hereunder specified in Exhibit "A".





                                       5
<PAGE>
         10. TRANSPORTATION COSTS TO AND FROM STORAGE. All transportation
charges and other expenses incurred in connection with (i) CUSTOMER's delivery
of Products to LESSOR'S Facility for storage and (ii) CUSTOMER's receipt of
Products from storage shall be paid by CUSTOMER directly to such transporter.

         11. STORAGE AND HANDLING CHARGES.

                   (a) CUSTOMER shall pay LESSOR the Storage Rate as set forth
         in Exhibit "A", without regard as to whether any Products have actually
         been or will be delivered by CUSTOMER to LESSOR for storage hereunder.
         CUSTOMER shall also pay LESSOR Monthly the other rates, fees and
         charges set forth in Exhibit "A", including, but not limited to,
         Throughput Charges and Redelivery Fees, if any.

                   (b) If at the end of any Month (i) the volume of a particular
         Product stored by CUSTOMER exceeds the storage volume of such Product
         allocated for that Month as designated by CUSTOMER as provided herein
         (the initial allocation of which is set forth in Exhibit "A", and/or
         (ii) the total volume of all Products stored by CUSTOMER exceeds the
         Lease Volume, CUSTOMER shall pay to LESSOR the Excess Storage Fee as
         set forth in Exhibit "A".

                   (c) If at the expiration or termination of this Agreement
         CUSTOMER continues to have Products in storage (which the parties
         expressly do not contemplate and LESSOR in no way condones) which was
         delivered into storage under the terms of this agreement, then CUSTOMER
         shall pay to LESSOR an Excess Storage Fee as set forth in Exhibit "A"
         each Month thereafter based on the highest balance of all Products held
         in storage at any time during such Month. LESSOR'S acceptance of funds
         pursuant to this Section shall (i) in no way be construed as a renewal
         of this Agreement, provided, however, CUSTOMER shall continue to be
         bound by all terms and conditions of this Agreement as long as any of
         CUSTOMER'S Products remains in storage or (ii) in no way effect
         LESSOR'S rights to sell CUSTOMER'S Products as provided for in Section
         3 above and any other rights that CUSTOMER may have.

                   (d) Nothing in this Section 11 shall be construed to create
         an obligation on LESSOR to accept more Products into storage in excess
         of the Lease Volume. At any time there is an unauthorized excess
         balance, LESSOR may by telephone notice to CUSTOMER require CUSTOMER to
         remove such excess balance within three Business Days and if any excess
         balance remains at the end of such period, then CUSTOMER shall
         reimburse LESSOR for any costs or liabilities incurred by LESSOR as a
         result thereof.

         12. INVOICING AND PAYMENTS. Each Month during the term of this
Agreement, LESSOR shall invoice CUSTOMER for all amounts owed by CUSTOMER to
LESSOR hereunder and CUSTOMER shall pay to LESSOR the amounts due no later than
ten (10) Days after CUSTOMER'S receipt of invoice therefore. If the Day on which
any payment is due is not a Business Day, then the relevant payment shall be due
upon the immediately preceding Business Day, except if such payment due date is
a Sunday or Monday, then the relevant payment shall be due upon the immediately
succeeding Business Day. Any amounts which remain due and owing after the due
date shall bear interest thereon at a per annum rate of







                                       6
<PAGE>

interest equal to the lower of the "Prime Rate" of interest as quoted from time
to time by the Wall Street Journal or its successor, plus two percent, or the
maximum lawful rate of interest (the "Base Rate"). If a good faith dispute
arises as to the amount payable in any statement, the amount not in dispute
shall be paid. If CUSTOMER elects to withhold any payment otherwise due as a
consequence of a good faith dispute, CUSTOMER shall provide LESSOR with written
notice of its reasons for withholding payment. The parties hereto agree to use
all reasonable efforts to resolve any such disputes in a timely manner. If it is
subsequently determine, whether by mutual agreement of the parties or otherwise,
that CUSTOMER is required to pay all or any portion of the disputed amounts to
LESSOR, in addition to paying over such amounts, CUSTOMER also shall pay
interest accrued on such amounts at the Base Rate from the original due date
until paid in full.

         13. LIEN FOR UNPAID CHARGES. CUSTOMER hereby grants unto LESSOR a lien
against any Products of CUSTOMER remaining in storage at any time for any unpaid
amounts, excluding any unpaid amounts disputed in good faith, which may be owing
by CUSTOMER to LESSOR hereunder. LESSOR specifically reserves the right to
refuse to redeliver Products stored by CUSTOMER at any time that there remains
any amounts due and owing by CUSTOMER to LESSOR according to the terms hereof
except to the extent such amounts are being disputed in good faith by CUSTOMER.
Without prejudice to any other remedies that LESSOR may have at law, in equity
and/or pursuant to the terms and provisions hereof, LESSOR may enforce the lien
granted herein by public or private sale of any or all of CUSTOMER's Products
remaining in storage and at any time or place and on any terms which LESSOR, in
its sole discretion, deems commercially reasonable after giving CUSTOMER not
less than five (5) Days notice of such sale.

         14. TITLE TO STORED PRODUCT. It is understood and agreed that (i) title
to the Products stored hereunder shall remain in CUSTOMER, subject to being
commingled with like Products belonging to LESSOR and/or other parties, which
CUSTOMER hereby grants unto LESSOR the right to do so, and ii) Products
redelivered to CUSTOMER by LESSOR may not be identical Products delivered by
CUSTOMER into LESSOR'S Facilities, but shall be considered as fungible goods
meeting the same quality specifications. With respect to Products in storage
pursuant to this agreement, it is specifically agreed as follows:

                   (a) In the event there should be any loss of Products (other
         than normal operating losses) from LESSOR Facilities and such loss is
         not attributable to the failure of LESSOR or its designee to exercise
         that degree of care as would be exercised by a reasonably careful
         Person under like circumstances, then CUSTOMER shall be prorated by
         LESSOR on the basis of the ratio of CUSTOMER's stored Products to the
         total volumes of like stored Products in such Facilities, including
         those volumes owned by CUSTOMER and LESSOR.

                   (b) In the event there should be a loss from storage and it
         is ultimately determined that such loss was solely attributable to
         LESSOR'S or its designee's failure to exercise that degree of care as
         would be exercised by a reasonably careful Person under like
         circumstances, then, subject to the provisions of Section 16
         hereinafter, it is agreed that LESSOR shall have the option, in its
         sole discretion, to replace CUSTOMER's lost volumes with like Products
         or to pay CUSTOMER the fair market value of such lost Products at the
         time of the loss.





                                       7
<PAGE>

         15. TAXES. CUSTOMER shall be responsible for the payment of any and all
ad valorem or other taxes or assessments levied or assessed on and attributable
to CUSTOMER's Products in storage pursuant to this agreement, provided however,
that LESSOR shall have the right, but not the obligation, to pay such taxes on
behalf of CUSTOMER (but at a like rate no greater than that paid by LESSOR on
its own like Products in storage) and CUSTOMER agrees to reimburse LESSOR for
any such taxes paid by LESSOR within ten (10) Days from the date of LESSOR'S
invoice therefore.

         16. LIMITATION OF LIABILITY.

                   (a) LESSOR shall not be liable to CUSTOMER for any loss of or
         injury to the Products stored by CUSTOMER, however caused, unless such
         loss or injury directly results from the failure of LESSOR or its
         designee to exercise that degree of care as would be exercised by a
         reasonably careful man under like circumstances. If any such loss or
         injury could not have been avoided through the exercise of such care as
         a reasonably careful man would exercise under like circumstances,
         LESSOR shall not be liable for such loss or injury.

                   (b) NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE
         CONTRARY, LESSOR SHALL NOT BE RESPONSIBLE FOR ANY PRODUCT LOSSES OR
         DAMAGES TO THE PRODUCT OR FOR ANY CLAIMS UNDER ANY INDEMNITY
         OBLIGATIONS THAT LESSOR MAY HAVE AS SET FORTH IN THIS AGREEMENT IN
         EXCESS OF THE STORAGE FEES AND RATES PAID BY CUSTOMER TO LESSOR AS
         PROVIDED HEREIN, IT BEING UNDERSTOOD AND AGREED THAT SUCH FEES ARE
         BASED ON A PER UNIT CHARGE AND, ACCORDINGLY, FOR THE PURPOSE OF THIS
         AGREEMENT, SATISFY ALL REQUIREMENTS OF THE UNIFORM COMMERCIAL CODE AND
         OTHER SIMILAR LAWS FOR LIMITATION OF LIABILITY. THE FOREGOING SHALL
         APPLY WHETHER OR NOT SUCH CLAIMS ARE FOUNDED IN WHOLE OR IN PART UPON
         THE NEGLIGENCE OF LESSOR OR IF LIABILITY WITHOUT FAULT IS IMPOSED ON
         LESSOR. LESSOR SHALL NOT BE RESPONSIBLE FOR OBTAINING INSURANCE TO
         COVER THE PRODUCTS STORED HEREUNDER.

                  (c) CUSTOMER AGREES TO DEFEND, INDEMNIFY AND HOLD LESSOR AND
         ITS AFFILIATES AND ITS AND THEIR RESPECTIVE AGENTS, OFFICERS,
         DIRECTORS, EMPLOYEES, REPRESENTATIVES, SUCCESSORS AND ASSIGNS HARMLESS
         FROM AND AGAINST ANY AND ALL CLAIMS WHICH ARISE IN CONNECTION WITH
         CUSTOMER'S TRANSPORTATION, STORAGE, USE, OR HANDLING OF PRODUCTS AFTER
         DELIVERY OF CUSTODY, POSSESSION AND CONTROL OF SUCH PRODUCT TO
         CUSTOMER. CUSTOMER'S INDEMNITY OBLIGATION HEREUNDER SHALL BE APPLICABLE
         EVEN IF SUCH CLAIMS ARE DETERMINED TO HAVE BEEN PARTLY CAUSED BY THE
         NEGLIGENCE OF LESSOR OR IF LIABILITY WITHOUT FAULT IS IMPOSED ON
         LESSOR, THE ONLY EXCEPTION TO SUCH OBLIGATION BEING WHERE THE
         NEGLIGENCE OF LESSOR IS DETERMINED TO BE THE SOLE CAUSE OF SUCH CLAIMS.




                                       8
<PAGE>

                   (d) FOR BREACH OF ANY PROVISION FOR WHICH AN EXPRESS REMEDY
         OR MEASURE OF DAMAGES IS PROVIDED IN THIS AGREEMENT, SUCH EXPRESS
         REMEDY OR MEASURE OF DAMAGES SHALL BE THE SOLE AND EXCLUSIVE REMEDY
         HEREUNDER, AND THE OBLIGOR'S LIABILITY SHALL BE LIMITED AS SET FORTH IN
         SUCH PROVISION, AND ALL OTHER REMEDIES OR DAMAGES ARE WAIVED. IF NO
         REMEDY OR MEASURE OF DAMAGES IS EXPRESSLY PROVIDED HEREIN, THE
         OBLIGOR'S LIABILITY SHALL BE LIMITED TO DIRECT ACTUAL DAMAGES ONLY,
         EXCLUDING LOST PROFITS, AND SUCH DIRECT ACTUAL DAMAGES SHALL BE THE
         SOLE AND EXCLUSIVE REMEDY HEREUNDER, AND ALL OTHER REMEDIES OR DAMAGES
         ARE WAIVED. IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY
         UNDER ANY PROVISION OF THIS AGREEMENT FOR CONSEQUENTIAL, INCIDENTAL,
         PUNITIVE, EXEMPLARY, OR INDIRECT DAMAGES IN TORT, CONTRACT OR
         OTHERWISE.

         17. NOTICE OF CLAIM AND FILING OF SUIT. Claims by CUSTOMER and all
other persons claiming, by, through or under CUSTOMER, must be presented in
writing to LESSOR within a reasonable time, and in no event later than sixty
(60) Days after (i) CUSTOMER's Product is redelivered or removed from LESSOR'S
Facilities or (ii) CUSTOMER is notified by LESSOR that loss of or injury to
Products has occurred, whichever is shorter. No action may be maintained by
CUSTOMER and any other persons claiming by, through or under CUSTOMER, against
LESSOR for loss of or injury to Products stored in LESSOR'S Facilities unless a
written claim therefore is received by LESSOR within the time periods set forth
herein and such action is commenced within twenty-four (24) Months after (a)
CUSTOMER's Products is redelivered or removed from LESSOR'S Facilities or (b)
CUSTOMER is notified by LESSOR that loss of or injury to Products has occurred
whichever is shorter. In the situation where LESSOR notifies CUSTOMER of a loss
or, injury to Products, the time limits for making written claims and the
maintaining of actions after notice, as set forth herein, begin on the date such
notice is sent by LESSOR.

         18. FORCE MAJEURE. In the event either party is rendered unable, wholly
or in part, by Force Majeure to carry out its obligations under this Agreement,
it is agreed that upon such party's giving notice and reasonably full
particulars of such Force Majeure in writing to the other party after the
occurrence of the cause relied on, then the obligations (except for the
obligation to pay money due hereunder) of the party giving such notice, so far
as and to the extent that they are affected by such Force Majeure, shall be
suspended during the continuance of any inability so caused, but for no longer
period, and such cause shall so far as possible be remedied with all reasonable
dispatch. The term "Force Majeure" as used herein shall mean acts of God,
strikes, lockouts, or other industrial disturbances, acts of the public enemy,
wars, blockades, insurrections, riots, epidemics, landslides, lightning,
earthquakes, fires, tornadoes, hurricanes, or storms, tornado, hurricane, or
storm warnings which in any party's reasonable judgment require the
precautionary shutdown of a facility, floods, washouts, arrests or restraints of
the government, either federal or state, civil or military, civil disturbances,
explosions, sabotage, breakage, or accident to equipment, machinery or lines of
pipe, freezing of machinery, equipment or lines of pipe, electric power
shortages, inability of any party to obtain necessary permits and/or permissions
due to existing or future rules, orders, laws or governmental authorities (both
federal, state and local), or any other causes, whether of the kind herein
enumerated or otherwise, which were not reasonably foreseeable, and which are
not within the control of the party claiming suspension and which such party is
unable to overcome by the







                                       9
<PAGE>

exercise of due diligence. The term "Force Majeure" shall also include those
instances in which either party hereto is delayed in acquiring, at reasonable
cost and after the exercise of reasonable diligence, (i) materials and supplies
required for the purpose of constructing and maintaining facilities, when such
party is obligated to do so for the performance of its obligations under this
Agreement, or (ii) permits or permission from any governmental agency required
for the purpose of (a) constructing and maintaining such facilities or (b)
acquiring materials or supplies required for such purpose. It is understood and
agreed that the settlement of strikes or lockouts shall be entirely within the
discretion of the party having the difficulty, and that the above requirement
that any Force Majeure shall be remedied with all reasonable dispatch shall not
require the settlement of strikes or lockouts by acceding to the demands of
opposing Parties when such course is inadvisable in the discretion of the party
having difficulty.

         19. SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit
of and be binding upon the parties hereto and their respective successors and
permitted assigns. Notwithstanding the foregoing, CUSTOMER shall not assign or
sublet this Agreement in whole or in part without the express written consent of
LESSOR; provided, however, LESSOR shall have the right to assign this Agreement
to any of its Affiliates, and to any future owner or owners of the Facilities
without the necessity of obtaining from CUSTOMER any consent thereto. Further
provided, however, CUSTOMER shall have the right to assign this Agreement to any
of its Affiliates, but any such assignment shall in no way relieve or release
CUSTOMER from any obligations hereunder whether accrued before or after any such
assignment.

         20. NO COMMISSIONS, FEES OR REBATES. No director, employee or agent of
either party shall give or receive any commission, fee, rebate gift or
entertainment of significant cost or value in connection with this Agreement.
Any representative or representative(s) authorized by either party may audit the
applicable records of the other party for the purpose of determining whether
there has been compliance with this Section.

         21. SEVERABILITY. This Agreement and the operations hereunder shall be
subject to the valid and applicable federal and state laws and the valid and
applicable orders, laws, local ordinances, rules, and regulations of any local,
state or federal authority having jurisdiction, but nothing contained herein
shall be construed as a waiver of any right to question or contest any such
order, laws, rules, or regulations in any forum having jurisdiction in the
premises. If any provision of this Agreement is held to be illegal, invalid, or
unenforceable under the present or future laws effective during the term of this
Agreement, (i) such provision will be fully severable, (ii) this Agreement will
be construed and enforced as if such illegal, invalid, or unenforceable
provision had never comprised a part of this Agreement, and (iii) the remaining
provisions of this Agreement will remain in full force and effect and will not
be affected by the illegal, invalid, or unenforceable provision or by its
severance from this Agreement. Furthermore, in lieu of such illegal, invalid, or
unenforceable provision, there will be added automatically as a part of this
Agreement a provision similar in terms to such illegal, invalid, or
unenforceable provision as may be possible and as may be legal, valid, and
enforceable. If a provision of this Agreement is or becomes illegal, invalid, or
unenforceable in any jurisdiction, the foregoing event shall not affect the
validity or enforceability in that jurisdiction of any other provision of this
Agreement nor the validity or enforceability in other jurisdictions of that or
any other provision of this Agreement.

         22. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND DUTIES OF THE





                                       10
<PAGE>

PARTIES ARISING OUT OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED,
ENFORCED, AND PERFORMED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, AS
THE SAME MAY BE AMENDED FROM TIME TO TIME, WITHOUT GIVING EFFECT TO ANY CHOICE
OR CONFLICT OF LAW PROVISION OR RULE THAT WOULD CAUSE THE APPLICATION OF THE
LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF TEXAS.

         23. AUTHORIZATION. CUSTOMER hereby authorizes LESSOR to release its
identity as a leased storage customer, who is interested in participating in
in-well activity.

         24. ENTIRE AGREEMENT WAIVER. This Agreement, including, without
limitation, all exhibits hereto, integrates the entire understanding between the
Parties with respect to the subject matter covered and supersedes all prior
understandings, drafts, discussions, or statements, whether oral or in writing,
expressed or implied, dealing with the same subject matter. This Agreement may
not be amended or modified in any manner except by a written document signed by
both parties that expressly amends this Agreement. No waiver by either party
hereto of any of the provisions of this Agreement shall be deemed or shall
constitute a waiver of any other provision hereof (whether or not similar) nor
shall such waiver constitute a continuing waiver unless expressly provided. No
waiver shall be effective unless made in writing and signed by the party to be
charged with such wavier.

         25. SETOFFS AND COUNTERCLAIMS. Except as otherwise provided herein,
each party hereto reserves to itself all rights, set-offs, counterclaims, and
other remedies and/or defenses which it is or may be entitled to arising from or
out of this Agreement or as otherwise provided by law.

         26. NO PARTNERSHIP, ASSOCIATION, ETC. Nothing contained in this
Agreement shall be construed to create an association, trust, partnership, or
joint venture or impose a trust or partnership duty, obligation, or liability on
or with regard to either party.

         27. EXHIBITS. All Exhibits attached hereto are incorporated herein by
reference as fully as though contained in the body hereof. If any provision of
any Exhibit conflicts with the terms and provisions hereof, the provisions of
this Agreement shall prevail.

         28. PRINCIPLES OR CONSTRUCTION AND INTERPRETATION. In construing this
Agreement, the following principles shall be followed:

                  (a) no consideration shall be given to the fact or presumption
         that one Party had a greater or lesser hand in drafting this Agreement;

                  (b) examples shall not be construed to limit, expressly or by
         implication, the matter they illustrate;

                  (c) the word "includes" and its syntactical variants mean
         "includes, but is not limited to" and corresponding syntactical variant
         expressions; and





                                       11
<PAGE>
                  (d) the plural shall be deemed to include the singular and
         vice versa, as applicable.

         29. NOTICE. Any notice or other communication provided for in this
Agreement or any notice which either party may desire to give to the other shall
be in writing and shall be deemed to have been properly given if and when sent
by facsimile transmission, delivered by hand, or if sent by mail, upon deposit
in the United States mail, either U.S. Express Mail, registered mail or
certified mail, with all postage fully prepaid, or if sent by courier, by
delivery to a bonded courier with charges paid in accordance with the customary
arrangements established by such courier, in each case addressed to the parties
at the following addresses:

                   If to LESSOR:

                           MARTIN UNDERGROUND STORAGE, INC.
                           P.O. BOX 191
                           Kilgore, Texas  75663-0191
                           Attn:  Matt Yost
                           Phone:    (903) 983-6200
                           Fax:  (903) 983-6237

                   If to CUSTOMER:

                           MARTIN OPERATING PARTNERSHIP L.P.
                           P.O. BOX 191
                           Kilgore, TX 75663-0191
                           Attn:  Tom E. Redd
                           Phone:  (903)983-6248
                           Fax:  (903)983-6237

or at such other address as either party shall designate by written notice to
the other. A notice sent by facsimile shall be deemed to have been received by
the close of the Business Day following the Day on which it was transmitted and
confirmed by transmission report or such earlier time as confirmed orally or in
writing by the receiving party. Notice by U.S. Mail, whether by U.S. Express
Mail, registered mail or certified mail, or by overnight courier shall be deemed
to have been received by the close of the second Business Day after the Day upon
which it was sent, or such earlier time as is confirmed orally or in writing by
the receiving party. Any party may change its address or facsimile number by
giving notice of such change in accordance herewith.


                       [SIGNATURES CONTINUED ON NEXT PAGE]




                                       12
<PAGE>
         IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective as of the day and year first above written.


                                    Agreed to and Accepted
                                    this 1st Day of November
                                    of 2002.




                                    MARTIN UNDERGROUND STORAGE, INC.



                                    By: /s/ Ruben S. Martin, III
                                    Name:  Ruben S. Martin, III
                                    Title: President




                                    MARTIN OPERATING PARTNERSHIP L.P.

                                    By:  Martin Operating GP LLC
                                    Its: General Partner

                                         By:  Martin Resource LLC
                                         Its: Sole Member

                                              By:  Martin Resource Management
                                                   Corporation
                                              Its: Sole Member

                                              By: /s/ Ruben S. Martin, III
                                              Name:  Ruben S. Martin, III
                                              Title: President







                                       13
<PAGE>
                                   EXHIBIT "A"
                                       TO
                            PRODUCT STORAGE AGREEMENT

          THIS PRODUCT STORAGE AGREEMENT, along with the General Terms and
Conditions set forth in the agreement to which this Exhibit is attached, shall
constitute our mutual agreement to lease space in facilities owned or controlled
by LESSOR.

<Table>
<S>                                 <C>
1.     CUSTOMER:                    Martin Operating Partnership L.P.

2.     TERM:                        Three years from the date of this agreement, automatically renewable
                                    from year to year, unless either party gives written notice at least thirty
                                    (30) days prior to the expiration of the applicable term.

3.     PRODUCTS:                    Propane and Butane

4.     STORAGE FACILITY:            Martin Underground, Arcadia, LA

5.     LEASE VOLUMES:               300,000 barrels

6.     STORAGE RATE:                See Below

7.     THROUGHPUT FEE:              $.025 per gallon until the first anniversary of this agreement, and then
                                    adjusted as set forth in Section 14 of this Exhibit A below. Applies only
                                    to movements out of storage via truck or pipeline.
8.     QUANTITY EXEMPT
       FROM THROUGHPUT
       FEE:                         None

9.     EXCESS STORAGE FEE:          N/A

10.    RETURN PERCENTAGE:           Based on volume received
       PIPELINE:                    100%
       TRUCKS:                      100%

11.    RECEIPT FEES:                None at Storage Facility. CUSTOMER shall pay any and all
       PIPELINE:                    Pipeline tariff fees for own account.
       TRUCKS:                      None

12.    DELIVERY FEES
       PIPELINE:                    $.025 per gallon per Throughput Fee referenced above.
       TRUCKS:                      $.025 per gallon per Throughput Fee referenced above.

13.    SCHEDULING:                  CUSTOMER shall be required to schedule all movements through
                                    LESSOR or its designee's Product Movement Group. Delivery orders for
                                    CUSTOMER's account will only be set up to cover Volumes that are
</Table>





                                       14
<PAGE>
<Table>
<S>                                 <C>
                                    physically in the storage account.

14.   FEE ADJUSTMENTS               After the first anniversary of this Agreement, the Throughput Fee shall be
                                    adjusted annually (both upward and downward as hereinafter provided) by a
                                    factor equal to the increase or decrease, as the case may be, in the Consumer
                                    Price Index. The adjustment shall be calculated annually in [October] of each
                                    year, commencing in October 2003 based on Consumer Price Index statistics for
                                    the two preceding Septembers. The adjustment shall be calculated as follows:
                                    The Throughput Fee in effect shall be multiplied by a factor equal to the
                                    amount of the increase or decrease, as the case may be, in the Consumer Price
                                    Index for the immediately preceding month of September, over the Consumer
                                    Price Index for September of the preceding year. For purposes hereof, the
                                    term "Consumer Price Index" shall mean the "Consumer Price Index for Urban
                                    Wage Earners and Clerical Workers (1967=100)" specified for "All Items. United
                                    States" compiled by the Bureau of Labor Statistics of the United States
                                    Department of Labor (the "Index"). In event the Index shall be converted to a
                                    different standard reference base or otherwise revised, the determination of
                                    the percentage change shall be made with the use of such conversion factor,
                                    formula or table for converting the Index as may be published by the Bureau of
                                    Labor Statistics or, if said Bureau shall not publish the same, then as shall
                                    be reasonably determined by the parties.
</Table>



                                       15
<PAGE>
                                   EXHIBIT "B"
                            PRODUCT STORAGE AGREEMENT
                                  SPECIFICATION
                              HD-5 PROPANE PRODUCT


<Table>
<Caption>
Component or
Characteristic                              Allowable                           Test Method
--------------                              ---------                           -----------

<S>                                 <C>                                         <C>
Propane                             90% Liquid Volume, Minimum                  ASTM D-2163

Propylene                           5% Liquid Volume, Maximum                   ASTM D-2163

Butanes & Heavier                   2.5% Liquid Volume, Maximum                 ASTM D-2163

Total Sulfur                        123 PPM, by weight, Maximum                 ASTM D-2784

Hydrogen Sulfide                    2 PPM, by volume, Maximum                   ASTM D-2377

Moisture                            Pass                                        ASTM D-2713

Residual Matter:                    .05 Maximum on 100 ML Evaporation           ASTM D-2158
                                    Pass Oil Stain Observation

Vapor Pressure Reid                 208 PSIG, Maximum                           ASTM D-1267
Method @ 100(Degrees)F

Volatile Reside                     -37(Degrees) Maximum                        ASTM D1837
Temperature @
95% Evaporation

Corrosion @ 100(Degrees)F           No. 1 Copper Strip, Maximum                 ASTM D-1838
</Table>


                                      NOTE:

     o   ASTM test methods are latest revision

     o   LESSOR reserves the right to change specifications in order to meet
         specifications in primary downstream markets

     o   If conflicting test method result exists, LESSOR result will prevail






                                       16





</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.9
<SEQUENCE>14
<FILENAME>d00990exv10w9.txt
<DESCRIPTION>MARINE FUEL AGREEMENT
<TEXT>
<PAGE>
                                                                    EXHIBIT 10.9




                              MARINE FUEL AGREEMENT

         This MARINE FUEL AGREEMENT is made and entered into this the 1st day of
November, 2002 by and between Midstream Fuel Service LLC, an Alabama limited
liability company, hereinafter referred to as "Midstream," and Martin Operating
Partnership L.P., a Delaware partnership, hereinafter referred to as "Customer."
Midstream and Customer agree as follows:

         1. For and in consideration of the conditions set forth herein, and
upon the terms and conditions hereinafter described, Midstream does hereby agree
to supply Customer High Sulfur Diesel ASTM D-975 No. 2 to Customer at
Midstream's docks in Mobile, Alabama; Theodore, Alabama; and Pascagoula,
Mississippi. The term of this agreement for three years, commencing November 1,
2002. After the initial term, the term shall automatically renew from year to
year, unless either party gives written notice at least thirty (30) days prior
to the expiration of the initial term or of any renewal term.

         2. Customer agrees to purchase from Midstream one hundred percent
(100%) its High Sulfur Diesel fuel requirements that occur in the Mobile,
Theodore, or Pascagoula areas, during the term of this agreement. Midstream
agrees to sell Customer High Sulfur Diesel ASTM D-975 No. 2 at its applicable
dock, at a price per gallon equal to Midstream's Average Inventory Cost in
effect on the date of delivery, plus $0.035 per gallon. Additional charges will
apply for deliveries made to locations other than Midstream's docks. Payments
shall be sent to Midstream at P.O. Box 911649, Dallas, Texas 75391-1649, or to
such other address as Midstream shall designate in writing.





                                      A-1
<PAGE>
         3. Midstream's Standard Conditions of Sale as set forth on Exhibit A
shall govern the terms and conditions of sales of High Sulfur Diesel ASTM D-975
No. 2 to Customer by Midstream.

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed the date first mentioned above.

                              MIDSTREAM FUEL SERVICE LLC

                              By:      Martin Resource Management Corporation
                              Its:     Sole manager


                                       By: /s/ Ruben S. Martin, III
                                               Ruben S. Martin, III
                                       Its: President



                              MARTIN OPERATING PARTNERSHIP L.P.

                              By:      Martin Operating GP LLC
                              Its:     General Partner

                                       By:      Martin Resource LLC
                                       Its:     Sole Member

                                                By:      Martin Resource
                                                         Management Corporation
                                                Its:     Sole Member

                                                By:  /s/ Ruben S. Martin, III
                                                         Ruben S. Martin, III
                                                Its: President





                                      A-2

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.10
<SEQUENCE>15
<FILENAME>d00990exv10w10.txt
<DESCRIPTION>PRODUCT SUPPLY AGREEMENT
<TEXT>
<PAGE>
                                                                   EXHIBIT 10.10


                            PRODUCT SUPPLY AGREEMENT

This agreement is entered into on this 1st day of November 2002, between Martin
Gas Sales LLC (hereinafter referred to as "Seller") with corporate office
located at 4200 Stone Road, Kilgore, TX 75662 and Martin Operating Partnership
L.P. (hereinafter referred to as "Buyer") with corporate office located at 4200
Stone Road, Kilgore, TX 75662.

         1.       DEFINITIONS

                  1.1      "Product" shall mean 93% or 98% sulfuric acid as
                           shown in Exhibit A.

         2.       AGREEMENT TERM

                  2.1      The term (hereinafter referred to as the "Initial
                           Term") of this Agreement shall be three (3) years
                           beginning on July 1, 2002. After the Initial Term,
                           the term shall automatically renew from year to year,
                           unless either party gives written notice at least
                           thirty (30) days prior to the expiration of the
                           Initial Term or of any renewal term. If any Product
                           deliveries are made before the indicated beginning
                           date, that Product will also be covered by this
                           Agreement.

         3.       QUANTITY

                  3.1      Seller agrees to supply and Buyer agrees to purchase
                           from Seller, 100% of Buyer's Plainview, Texas plant
                           requirements, currently estimated at 8,000 tons per
                           month. Seller also recognizes that Buyer may choose
                           not to run the Plainview, Texas plant based on market
                           conditions and Seller will adjust supply depending on
                           Buyer's needs.

         4.       PRICING

                  4.1      Seller agrees to supply Buyer with Product at a price
                           equal to Seller's best available cost plus $4/short
                           ton.

                  4.2      Additionally, if Seller requires truck tons F.O.B.
                           Buyer's plant, Buyer agrees to provide tons to Seller
                           at Buyer's cost plus $4/ton.

         5.       PAYMENT TERMS

                  5.1      All invoices will be paid net thirty (30) days from
                           shipment by Seller.

         6.       SEVERABILITY

                  6.1      If any provision of this Agreement is found to be
                           illegal or unenforceable,




<PAGE>
                           Such provision shall be deemed not to part of this
                           Agreement and this Agreement shall continue in full
                           force and effect, but shall be interpreted to give
                           effect to the extent feasible to the original written
                           intent of the parties.

         7.       ENTIRE AGREEMENT

                  7.1      This Agreement sets forth the entire Agreement
                           between Seller and Buyer with respect to Product.
                           This Agreement supercedes and cancels all prior and
                           contemporaneous agreements and understanding between
                           the parties, whether oral or written, relating to
                           this product. Exhibit A attached hereto is made a
                           part hereof and are incorporated herein by reference.

         8.       CONTROLLING LAW

                  8.1      This Agreement shall be governed by and construed in
                           accordance with the laws of the State of Texas.

         IN WITNESS WHEREOF the duly authorized parties hereto as of the date
first set forth above have duly executed this Agreement.


MARTIN GAS SALES LLC

         By:  Martin Resource Management Corporation
         Its Sole Member

                  By:     /s/ Ruben S. Martin, III
                  Name:   Ruben S. Martin, III
                  Title:  President



MARTIN OPERATING PARTNERSHIP L.P.

By:  Martin Operating GP LLC, its general partner

         By:  Martin Resource LLC, its sole member

                  By:  Martin Resource Management Corporation, its sole member

                           By:    /s/ Ruben S. Martin, III
                           Name:  Ruben S. Martin, III
                           Title: President

<PAGE>
                                   EXHIBIT "A"



                             MARTIN GAS SALES, INC.
                 93% AND 98% GRADE SULFURIC ACID SPECIFICATIONS

<Table>
<Caption>
                                                               Typical                 Guaranteed Maximum
                             Element                           Analysis                       98%
                             -------                           --------                ------------------
<S>                                                           <C>                           <C>
                              H2S04                              98.5%                    97.8 - 99.5%

                              H2S04                              93.5%                    92.8 - 94.2%

                            Iron (Fe)                            15 ppm                        50 ppm

                      Sulphur Dioxide (SO(2))                   <25 ppm                        50 ppm

                            Nitrates                              5 ppm                       <50 ppm

                          Heavy Metals                           <5 ppm                        20 ppm
</Table>








</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.11
<SEQUENCE>16
<FILENAME>d00990exv10w11.txt
<DESCRIPTION>LONG-TERM INCENTIVE PLAN
<TEXT>
<PAGE>
                                                                   EXHIBIT 10.11

                         MARTIN MIDSTREAM PARTNERS L.P.
                            LONG-TERM INCENTIVE PLAN

SECTION 1. Purpose of the Plan.

         The Martin Midstream Partners L.P. Long-Term Incentive Plan (the
"Plan") is intended to promote the interests of Martin Midstream Partners L.P.,
a Delaware limited partnership (the "Partnership"), by providing to Employees
and Directors of Martin Midstream GP LLC, a Delaware limited liability company
(the "Company") and its Affiliates who perform services for the Partnership,
incentive compensation awards for superior performance that are based on Units.
The Plan is also contemplated to enhance the ability of the Company and its
Affiliates to attract and retain the services of individuals who are essential
for the growth and profitability of the Partnership and to encourage them to
devote their best efforts to the business of the Partnership, thereby advancing
the interests of the Partnership.

SECTION 2. Definitions.

         As used in the Plan, the following terms 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. As used
herein, the term "control" means the possession, direct or indirect, of the
power to direct or cause the direction of the management and policies of a
Person, whether through ownership of voting securities, by contract or
otherwise.

         "Award" means an Option or Phantom Unit granted under the Plan, and
shall include any DER granted with respect to a Phantom Unit.

         "Award Agreement" means the agreement entered into between the
Partnership and the Participant evidencing the terms and conditions of the
Award.

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

         "Change in Control" shall be deemed to have occurred upon the
occurrence of one or more of the following events: (i) any sale, lease, exchange
or other transfer (in one or a series of related transactions) of all or
substantially all of the assets of the Partnership, the Company or the Operating
Partnership to any Person or its Affiliates, other than the Partnership, the
Company or any of their Affiliates, (ii) any merger, reorganization,
consolidation or other transaction pursuant to which more than 50% of the
combined voting power of the equity interests in either the Company or Martin
Resource Management Corporation ceases to be owned by Persons who own such
interests, respectively, as of the date immediately prior to the effective date
of the initial public offering of Units, or (iii) the general partner (whether
the Company or any other Person) of the Partnership ceases to be an Affiliate of
Martin Resource Management Corporation.

         "Committee" means the Compensation Committee of the Board or such other
committee of the Board appointed by the Board to administer the Plan.


<PAGE>


         "DER" means a right, granted in tandem with a Phantom Unit, to receive
an amount in cash equal to, and at the same time as, the cash distributions made
by the Partnership with respect to a Unit during the period such Phantom Unit is
outstanding.

         "Director" means a member of the Board or the board of directors or
managers of an Affiliate who is not an Employee.

         "Employee" means any employee of the Company or an Affiliate, as
determined by the Committee.

         "Exchange Act" means the Securities Exchange Act of 1934.

         "Fair Market Value" means the closing sales price of a Unit on the date
of determination (or if there is no trading in the Units on such date, the
closing sales price on the last date the Units were traded) as reported in The
Wall Street Journal (or other reporting service approved by the Committee). In
the event Units are not publicly traded at the time a determination of Fair
Market Value is required to be made hereunder, the determination of Fair Market
Value shall be made in good faith by the Committee.

         "Option" means an option to purchase Units granted under the Plan.

         "Participant" means any Employee or Director granted an Award under the
Plan.

         "Partnership Agreement" means the Amended and Restated Agreement of
Limited Partnership of Martin Midstream Partners L.P.

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

         "Phantom Unit" means a phantom (notional) unit granted under the Plan
which upon vesting entitles the Participant to receive a Unit or an amount of
cash equal to the Fair Market Value of a Unit, whichever is determined by the
Committee.

         "Plan" means this Martin Midstream Partners L.P. Long-Term Incentive
Plan, as amended from time to time.

         "Restricted Period" means the period established by the Committee with
respect to an Award during which the Award remains subject to forfeiture (i.e.,
it is not vested) and is not exercisable by or payable to the Participant;
provided, however, that the Restricted Period with respect to any Award may not
terminate prior to the end of the Subordination Period (as defined in the
Partnership Agreement) except (i) at the same time and in the same proportion as
subordinated units are converted into Units, or (ii) upon a Change in Control.


                                      -2-
<PAGE>


         "Rule 16b-3" means Rule 16b-3 promulgated by the SEC under the Exchange
Act, or any successor rule or regulation thereto as in effect from time to time.

         "SEC" means the Securities and Exchange Commission, or any successor
thereto.

         "Unit" means a Common Unit of the Partnership.

SECTION 3. Administration.

         The Plan shall be administered by the Committee. A majority of the
Committee shall constitute a quorum, and the acts of the members of the
Committee who are present at any meeting thereof at which a quorum is present,
or acts unanimously approved by the members of the Committee in writing, shall
be the acts of the Committee. Subject to the following and any applicable law,
the Committee, in its sole discretion, may delegate any or all of its powers and
duties under the Plan (provided the Chief Executive Officer is a member of the
Board), including the power to grant Awards under the Plan, to the Chief
Executive Officer of the Company (provided that the Chief Executive Officer is a
member of the Board), subject to such limitations on such delegated powers and
duties as the Committee may impose, if any. Upon any such delegation all
references in the Plan to the "Committee", other than in Section 7, shall be
deemed to include the Chief Executive Officer; provided, however, that such
delegation shall not limit the Chief Executive Officer's right to receive Awards
under the Plan. Notwithstanding the foregoing, the Chief Executive Officer may
not grant Awards to, or take any action with respect to any Award previously
granted to, himself, a person who is an officer subject to Rule 16b-3 or a
member of the Board (including the Chief Executive Officer). Subject to the
terms of the Plan and applicable law, and in addition to other express powers
and authorizations conferred on the Committee by the Plan, the Committee shall
have full power and authority to: (i) designate Participants; (ii) determine the
type or types of Awards to be granted to a Participant; (iii) determine the
number of Units to be covered by Awards; (iv) determine the terms and conditions
of any Award; (v) determine whether, to what extent, and under what
circumstances Awards may be settled, exercised, canceled, or forfeited; (vi)
interpret and administer the Plan and any instrument or agreement relating to an
Award made under the Plan; (vii) establish, amend, suspend, or waive such rules
and regulations and appoint such agents as it shall deem appropriate for the
proper administration of the Plan; and (viii) make any other determination and
take any other action that the Committee deems necessary or desirable for the
administration of the Plan. Unless otherwise expressly provided in the Plan, all
designations, determinations, interpretations, and other decisions under or with
respect to the Plan or any Award shall be within the sole discretion of the
Committee, may be made at any time and shall be final, conclusive, and binding
upon all Persons, including the Company, the Partnership, any Affiliate, any
Participant, and any beneficiary of any Award.

SECTION 4. Units.

         (a) Units Available. Subject to adjustment as provided in Section 4(c),
the number of Units with respect to which (i) Phantom Units may be granted under
the Plan is 241,667 and (ii) the number of Units with respect to which Options
may be granted under the Plan is 483,333. If any Option or Phantom Unit is
forfeited or otherwise terminates or is canceled without the


                                      -3-
<PAGE>


delivery of Units, then the Units covered by such Award, to the extent of such
forfeiture, termination or cancellation, shall again be Units with respect to
which an Option or Phantom Unit, as the case may be, may be granted.

         (b) Sources of Units Deliverable Under Awards. Any Units delivered
pursuant to an Award shall consist, in whole or in part, of Units acquired in
the open market, from any Affiliate, or from the Partnership, or any combination
of the foregoing, as determined by the Committee in its discretion.

         (c) Adjustments. In the event that the Committee determines that any
distribution (whether in the form of cash, Units, other securities, or other
property), recapitalization, split, reverse split, reorganization, merger,
consolidation, split-up, spin-off, combination, repurchase, or exchange of Units
or other securities of the Partnership, issuance of warrants or other rights to
purchase Units or other securities of the Partnership, or other similar
transaction or event affects the Units such that an adjustment is determined by
the Committee to be appropriate in order to prevent dilution or enlargement of
the benefits or potential benefits intended to be made available under the Plan,
then the Committee shall, in such manner as it may deem equitable, adjust any or
all of (i) the number and type of Units (or other securities or property) with
respect to which Awards may be granted, (ii) the number and type of Units (or
other securities or property) subject to outstanding Awards, and (iii) the grant
or exercise price with respect to any Award or, if deemed appropriate, make
provision for a cash payment to the holder of an outstanding Award; provided,
that the number of Units subject to any Award shall always be a whole number.

SECTION 5. Eligibility.

         Any Employee who performs services for the benefit of the Partnership
as determined by the Committee, or any Director shall be eligible to be
designated a Participant and receive an Award under the Plan.

SECTION 6. Awards.

         (a) Options. The Committee shall have the authority to determine the
Employees and Directors to whom Options shall be granted, the number of Units to
be covered by each Option, the purchase price therefor, the Restricted Period
and the conditions and limitations applicable to the exercise of the Option,
including the following terms and conditions and such additional terms and
conditions, as the Committee shall determine, that are not inconsistent with the
provisions of the Plan.

                  (i) Exercise Price. The purchase price per Unit purchasable
         under an Option shall be determined by the Committee at the time the
         Option is granted and may not be less than its Fair Market Value as of
         the date of grant.

                  (ii) Time and Method of Exercise. The Committee shall
         determine the Restricted Period with respect to an Option, which may
         include, without limitation, accelerated vesting upon the achievement
         of specified performance goals, and the method


                                      -4-
<PAGE>


         or methods by which payment of the exercise price with respect thereto
         may be made or deemed to have been made, which may include, without
         limitation: (a) cash, (b) check acceptable to the Company, (c) a
         "cashless-broker" exercise through procedures approved by the Company,
         (d) a full recourse note from the Participant in a form acceptable to
         the Company, provided that such note shall bear a "market" rate of
         interest to preclude variable accounting for financial accounting
         purposes, and shall not be made to any Director or executive Employee
         of the Company, Partnership or any Affiliate, or (e) any combination
         thereof, having a Fair Market Value on the exercise date equal to the
         relevant exercise price.

                  (iii) Forfeiture. Except as otherwise provided in the terms of
         the Option grant, upon termination of a Participant's employment with
         the Company and its Affiliates or membership on the Board, whichever is
         applicable, for any reason during the applicable Restricted Period, all
         Options shall be forfeited by the Participant. The Committee may, in
         its discretion, waive in whole or in part such forfeiture with respect
         to a Participant's Options.

         (b) Phantom Units. The Committee shall have the authority to determine
the Employees and Directors to whom Phantom Units shall be granted, the number
of Phantom Units to be granted to each such Participant, the Restricted Period,
the conditions under which the Phantom Units may become vested or forfeited,
which may include, without limitation, the accelerated vesting upon the
achievement of specified performance goals, and such other terms and conditions
as the Committee may establish with respect to such Awards including whether
DERs are granted with respect to such Phantom Units.

                  (i) DERs. Phantom Units granted under the Plan may include a
         tandem DER grant.

                  (ii) Forfeiture. Except as otherwise provided in the terms of
         the Phantom Units grant, upon termination of a Participant's employment
         with the Company and its Affiliates or membership on the Board,
         whichever is applicable, for any reason during the applicable
         Restricted Period, all Phantom Units shall be forfeited by the
         Participant. The Committee may, in its discretion, waive in whole or in
         part such forfeiture with respect to a Participant's Phantom Units.

                  (iii) Lapse of Restrictions. Upon or as soon as reasonably
         practical following the vesting of each Phantom Unit, the Participant
         shall be entitled to receive from the Company one Unit or cash equal to
         the Fair Market Value of a Unit, as determined by the Committee in its
         discretion.

         (c) General.

                  (i) Awards May Be Granted Separately or Together. Awards may,
         in the discretion of the Committee, be granted either alone or in
         addition to, in tandem with, or in substitution for any other Award
         granted under the Plan or any award granted under any other plan of the
         Company or any Affiliate. Awards granted in addition to or in


                                      -5-
<PAGE>


         tandem with other Awards or awards granted under any other plan of the
         Company or any Affiliate may be granted either at the same time as or
         at a different time from the grant of such other Awards or awards.

                  (ii) Limits on Transfer of Awards.

                           (A) Except as provided in (C) below, each Option
                  shall be exercisable only by the Participant during the
                  Participant's lifetime, or by the person to whom the
                  Participant's rights shall pass by will or the laws of descent
                  and distribution.

                           (B) Except as provided in (C) below, no Award and no
                  right under any such Award may be assigned, alienated,
                  pledged, attached, sold or otherwise transferred or encumbered
                  by a Participant and any such purported assignment,
                  alienation, pledge, attachment, sale, transfer or encumbrance
                  shall be void and unenforceable against the Company or any
                  Affiliate.

                           (C) To the extent specifically provided by the
                  Committee in any Award Agreement, an Option may be transferred
                  by a Participant without consideration to immediate family
                  members or related family trusts, limited partnerships or
                  similar entities but only on such terms and conditions as the
                  Committee may from time to time establish.

                  (iii) Term of Awards. The term of each Award shall be for such
         period as may be determined by the Committee.

                  (iv) Unit Certificates. All certificates for Units or other
         securities of the Partnership delivered under the Plan pursuant to any
         Award or the exercise thereof shall be subject to such stop transfer
         orders and other restrictions as the Committee may deem advisable under
         the Plan or the rules, regulations, and other requirements of the SEC,
         any stock exchange upon which such Units or other securities are then
         listed, and any applicable federal or state laws, and the Committee may
         cause a legend or legends to be put on any such certificates to make
         appropriate reference to such restrictions.

                  (v) Consideration for Grants. Awards may be granted for such
         consideration, including services, as the Committee determines.

                  (vi) Delivery of Units or other Securities and Payment by
         Participant of Consideration. Notwithstanding anything in the Plan or
         any grant agreement to the contrary, delivery of Units pursuant to the
         exercise or vesting of an Award may be deferred for any period during
         which, in the good faith determination of the Committee, the Company is
         not reasonably able to obtain Units to deliver pursuant to such Award
         without violating the rules or regulations of any applicable law or
         securities exchange. No Units or other securities shall be delivered
         pursuant to any Award until payment in full of any amount required to
         be paid pursuant to the Plan or the applicable Award Agreement
         (including, without limitation, any exercise price or tax withholding)
         is received by the Company. Such payment may be made by such method or
         methods and


                                      -6-
<PAGE>


         in such form or forms as the Committee shall determine, including,
         without limitation, cash, other Awards, withholding of Units,
         cashless-broker exercises with simultaneous sale, or any combination
         thereof; provided that the combined value, as determined by the
         Committee, of all cash and cash equivalents and the Fair Market Value
         of any such Units or other property so tendered to the Company, as of
         the date of such tender, is at least equal to the full amount required
         to be paid to the Company pursuant to the Plan or the applicable Award
         agreement.

                  (vii) Change in Control. Upon a Change in Control or such
         period prior thereto as may be established by the Committee, all Awards
         shall automatically vest and become payable or exercisable, as the case
         may be, in full. In this regard, all Restricted Periods shall terminate
         and all performance criteria, if any, shall be deemed to have been
         achieved at the maximum level. To the extent an Option is not exercised
         upon a Change in Control, the Committee may, in its discretion, cancel
         such Award without payment or provide for a replacement grant with
         respect to such Award on such terms as it deems appropriate.

SECTION 7. Amendment and Termination.

         Except to the extent prohibited by applicable law:

         (a) Amendments to the Plan. Except as required by the rules of the
principal securities exchange on which the Units are traded and subject to
Section 7(b) below, the Board or the Committee may amend, alter, suspend,
discontinue, or terminate the Plan in any manner, including increasing the
number of Units available for Awards under the Plan, without the consent of any
partner, Participant, other holder or beneficiary of an Award, or other Person;
provided, however, that no amendment to the Plan may be made without the
approval of a Unit Majority (as defined in the Partnership Agreement) that would
accelerate vesting to prior to the end of the Subordination Period, except as
provided in the current definition of Restricted Period.

         (b) Amendments to Awards. Subject to Section 7(a), the Committee may
waive any conditions or rights under, amend any terms of, or alter any Award
theretofore granted, provided no change, other than pursuant to Section 7(c), in
any Award shall materially reduce the benefit to a Participant without the
consent of such Participant.

         (c) Adjustment of Awards Upon the Occurrence of Certain Unusual or
Nonrecurring Events. The Committee is hereby authorized to make adjustments in
the terms and conditions of, and the criteria included in, Awards in recognition
of unusual or nonrecurring events (including, without limitation, the events
described in Section 4(c) of the Plan) affecting the Partnership or the
financial statements of the Partnership, or of changes in applicable laws,
regulations, or accounting principles, whenever the Committee determines that
such adjustments are appropriate in order to prevent dilution or enlargement of
the benefits or potential benefits intended to be made available under the Plan.


                                      -7-
<PAGE>


SECTION 8. General Provisions.

         (a) No Rights to Award. No Person shall have any claim to be granted
any Award under the Plan, and there is no obligation for uniformity of treatment
of Participants. The terms and conditions of Awards need not be the same with
respect to each recipient.

         (b) Withholding. The Company or any Affiliate is authorized to withhold
from any Award, from any payment due or transfer made under any Award or from
any compensation or other amount owing to a Participant the minimum required
amount of any applicable federal and state income and employment taxes payable
in respect to the grant of an Award, its exercise, or any payment or transfer
under an Award or under the Plan. Such withholding shall, at the sole discretion
of the Committee, consist in whole or in part of: cash, Units, Units that would
otherwise be issued pursuant to such Award or other property.

         (c) No Right to Employment. The grant of an Award shall not be
construed as giving a Participant the right to be retained in the employ of the
Company or any Affiliate or to remain on the Board, as applicable. Further, the
Company or an Affiliate may at any time dismiss a Participant from employment,
free from any liability or any claim under the Plan.

         (d) Governing Law. The validity, construction, and effect of the Plan
and any rules and regulations relating to the Plan shall be determined in
accordance with the laws of the State of Delaware without regard to its conflict
of laws principles.

         (e) Severability. If any provision of the Plan or any Award becomes
invalid, illegal, or unenforceable in any jurisdiction or as to any Person or
Award, or would disqualify the Plan or any Award under any law deemed applicable
by the Committee, such provision shall be deemed amended to conform to the
applicable laws, or if it cannot be construed or deemed amended without
materially altering the intent of the Plan or the Award, such provision shall be
stricken as to such jurisdiction, person or Award and the remainder of the Plan
and any such Award shall remain in full force and effect.

         (f) Other Laws. The Committee may refuse to issue or transfer any Units
or other consideration under an Award if, in its sole discretion, it determines
that the issuance or transfer of such Units or such other consideration might
violate any applicable law or regulation, the rules of the principal securities
exchange on which the Units are then traded, or entitle the Partnership or an
Affiliate to recover the same under Section 16(b) of the Exchange Act, and any
payment tendered to the Company by a Participant, other holder or beneficiary in
connection with the exercise of such Award shall be promptly refunded to the
relevant Participant, holder or beneficiary.

         (g) No Trust or Fund Created. Neither the Plan nor any Award shall
create or be construed to create a trust or separate fund of any kind or a
fiduciary relationship between the Company or any participating Affiliate and a
Participant or any other Person. To the extent that any Person acquires a right
to receive payments from the Company or any participating Affiliate pursuant to
an award, such right shall be no greater than the right of any general unsecured
creditor of the Company or any participating Affiliate.


                                      -8-
<PAGE>


         (h) No Fractional Units. No fractional Units shall be issued or
delivered pursuant to the Plan or any Award, and the Committee shall determine
whether cash, other securities, or other property shall be paid or transferred
in lieu of any fractional Units or whether such fractional Units or any rights
thereto shall be canceled, terminated, or otherwise eliminated.

         (i) Headings. Headings are given to the Sections and subsections of the
Plan solely as a convenience to facilitate reference. Such headings shall not be
deemed in any way material or relevant to the construction or interpretation of
the Plan or any provision thereof.

         (j) Facility of Payment. Any amounts payable hereunder to any person
under legal disability or who, in the judgment of the Committee, is unable to
properly manage his financial affairs, may be paid to the legal representative
of such person, or may be applied for the benefit of such person in any manner
that the Committee may select, and the Company shall be relieved of any further
liability for payment of such amounts.

         (k) Gender and Number. Words in the masculine gender shall include the
feminine gender, the plural shall include the singular and the singular shall
include the plural.

SECTION 9. Term of the Plan.

         The Plan shall be effective on the date of its approval by the Board
and shall continue until the date terminated by the Board or the date Units are
no longer available for the payment of Awards under the Plan, whichever occurs
first. However, unless otherwise expressly provided in the Plan or in an
applicable Award Agreement, any Award granted prior to such termination, and the
authority of the Board or the Committee to amend, alter, adjust, suspend,
discontinue, or terminate any such Award or to waive any conditions or rights
under such Award, shall extend beyond such termination date.


                                      -9-

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.12
<SEQUENCE>17
<FILENAME>d00990exv10w12.txt
<DESCRIPTION>ASSIGNMENT AND ASSUMPTION OF LEASE AND SUBLEASE
<TEXT>
<PAGE>
                                                                   EXHIBIT 10.12


                                                                  EXECUTION COPY


                 ASSIGNMENT AND ASSUMPTION OF LEASE AND SUBLEASE


         This ASSIGNMENT AND ASSUMPTION OF LEASE AND SUBLEASE (this
"Assignment") is dated effective as of 12:01 a.m. on November 1, 2002 (the
"Effective Time"), by and among Martin Gas Sales LLC, a Texas limited liability
company formerly known as Martin Gas Sales, Inc., a Texas corporation, prior to
its conversion to a limited liability company under Article 5.17 of the Texas
Business Corporation Act (the "Assignor"), and Martin Operating Partnership
L.P., A Delaware limited partnership ("Assignee").

                                   WITNESSETH

         WHEREAS, the Tampa Port Authority, a body politic and corporate under
and by virtue of the Laws of the State of Florida, and of Hillsborough County,
and, as the governing body of the Hillsborough County Port District, as landlord
("Landlord"), and Assignor, as tenant, are parties to that certain Lease
Agreement, dated as of December 16, 1976, as amended by eight amendments
thereto, including the Consent to Assignment and Attornment Agreement dated
March 30, 1995, between, the Tampa Port Authority, Martin Gas Sales, Inc., and
Boliden Chemicals, Inc., (which Lease Agreement, together with all
modifications, amendments and supplements thereto, is hereinafter referred to
collectively as the "Lease"), a copy of which is attached hereto as Exhibit A,
pursuant to which Landlord leases to Assignor, and Assignor leases from
Landlord, the property situated in Hillsborough County, Florida, and commonly
referred to as "4118 Pendola Point Road," consisting of approximately 9.94 acres
as more particularly described and set forth in Exhibit "A" to the Lease (the
"Premises");

         WHEREAS, Tenant has subleased a portion of the Premises (such portion
referred to herein as the "Subleased Premises") to CF Martin Sulphur, LP, a
Delaware limited partnership ("CF"), pursuant to that certain Sublease Agreement
between Tenant and CF, dated as of November 22, 2000 (the "Sublease"), a copy of
which is attached as Exhibit B;

         WHEREAS, pursuant to the terms of that certain Contribution, Conveyance
and Assumption Agreement, dated as of the Effective Time, to which Assignor and
Assignee are parties, Assignee is acquiring Assignor's right, title and interest
in and to certain assets of Assignor, including all right, title and interest
in, to and under the Lease and the Sublease, including Assignor's post Effective
Time liabilities and obligations under the Lease and the Sublease;

         WHEREAS, in connection with the foregoing, Assignor desires to assign
the Lease and the Sublease to Assignee, and Assignee desires to accept the
assignment of the Lease and the Sublease from Assignor and to assume and be
bound by all of the terms, conditions, provisions, obligations, covenants and
duties of Assignor under the Lease and the Sublease from and after the Effective
Time; and




                                       1
<PAGE>

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Assignor and Assignee hereby
covenant and agree as follows:

         1. Assignment. As of the Effective Time, Assignor hereby grants,
assigns and transfers to Assignee, its successors and assigns, all of Assignor's
right, title and interest in, to and under the Lease and the Sublease
(including, without limitation, any options under the Lease and the Sublease and
any rights to extend or renew the Lease and the Sublease), and Assignee accepts
from Assignor all of Assignor's right, title and interest in, to and under the
Lease and the Sublease.

         2. Assumption of Obligations. As of the Effective Time, Assignee hereby
assumes and agrees to be bound by and to perform and fulfill all of the terms,
conditions, provisions, obligations, covenants and duties required to be
performed and fulfilled by Assignor under the Lease and the Sublease from and
after the Effective Time as if Assignee was an original party thereto,
including, without limitation, any and all post Effective Time payment or
performance obligations due under the Lease and the Sublease.

         3. Representations of Assignor. Assignor represents to Assignee as
follows:

                  a. The Lease and the Sublease attached hereto as Exhibit A,
         and Exhibit B, respectively, are true, correct and complete copies of
         the Lease and the Sublease;

                  b. The Lease and the Sublease are in full force and effect and
         have not been modified, amended or supplemented except as set forth
         therein;

                  c. Other than the Lease, there are no other agreements,
         whether written or oral, between Landlord and Assignor regarding the
         Premises or Assignor's obligations thereunder;

                  d. Other than the Sublease and that certain Easement Agreement
         between Sublessee and Tenant dated as of November 22, 2000, there are
         no other agreements, whether written or oral, between Assignor and
         Sublessee regarding the Subleased Premises or Assignor's or Sublessee's
         obligations thereunder;

                  e. No default or breach by Assignor or Landlord has occurred
         and is continuing under the Lease, and no event has occurred and is
         continuing which, with or without the giving of notice or the lapse of
         time, or both, would constitute a default thereunder;

                  f. No default or breach by Assignor or Sublessee has occurred
         and is continuing under the Sublease, and no event has occurred and is
         continuing which, with or without the giving of notice or the lapse of
         time, or both, would constitute a default thereunder;

                  g. The current term of the Lease expires on December 15, 2006,
         unless sooner terminated (or extended) as provided in the Lease;




                                       2
<PAGE>

                  h. The current term of the Sublease expires on December 14,
         2006, unless sooner terminated (or extended) as provided in the
         Sublease; and

                  i. To Assignor's knowledge, neither Landlord nor Sublessee has
         filed a petition in bankruptcy or has been subject to an involuntary
         petition in bankruptcy which has been dismissed or made an assignment
         for the benefit of creditors.

         4. Successors and Assigns. This Assignment shall be binding on and
inure to the benefit of the parties hereto, and their respective successors and
assigns, provided that this Section 4 shall not be construed to permit any
future assignments of the Lease or the Sublease or any subletting of the
Premises or the Subleased Premises except as expressly permitted by the Lease or
the Sublease, as the case may be.

         5. Counterparts. This Assignment may be signed in counterparts, each of
which shall be deemed an original and all of which, when taken together, shall
constitute one and the same instrument.

         6. Governing Law. This Assignment shall be governed by and construed in
accordance with the laws of the State of Florida.




                                       3
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have executed this assignment as
of the Effective Time.



<Table>
<S>                                         <C>
ATTEST:                                     ASSIGNOR:

                                            MARTIN GAS SALES LLC
By: /s/ Chad D. Burkardt
      Name: Chad D. Burkhardt               By: Martin Resource Management Corporation
                                                Its Sole Member

ATTEST:
                                                By: /s/ Robert Bondurant
                                                    Robert Bondurant
                                                    Chief Financial Officer
By: /s/ Adam Gallegos
      Name: Adam Gallegos


ATTEST:                                              ASSIGNEE:

                                                     MARTIN OPERATING PARTNERSHIP L.P.
By: /s/ Chad D. Burkhardt
      Name: Chad D. Burkhardt               By:      Martin Operating GP LLC
                                                             Its General Partner

ATTEST:                                                      By:     Martin Resource LLC
                                                                     Its Sole Member

By: /s/ Adam Gallegos                                                By:    Martin Resource Management Corporation
      Name: Adam Gallegos                                                   Its Sole Member


                                                                            By: /s/ Robert Bondurant
                                                                                  Robert Bondurant
                                                                                 Chief Executive Officer
</Table>





                                       4
<PAGE>


STATE OF TEXAS, COUNTY OF DALLAS, TO WIT:

         On this 1st day of November, 2002, before me, a notary public of said
State and County, personally appeared Robert Bondurant, who acknowledged himself
to be Chief Financial Officer of Martin Resource Management Corporation, the
sole member of Martin Gas Sales LLC and that he being authorized so to do,
executed the foregoing instrument for the purposes therein contained, by signing
the name of the limited liability company by himself as an officer thereof.

         IN WITNESS WHEREOF, I hereunto set my hand and official seal.


                                                  /s/ Adam Gallegos
                                                  Notary Public
My Commission Expires: 10-17-2004





                                       5
<PAGE>


STATE OF TEXAS, COUNTY OF DALLAS, TO WIT:

         On this 1st day of November, 2002, before me, a notary public of said
State and County, personally appeared Robert Bondurant, who acknowledged himself
to be Chief Financial Officer of Martin Resource Management Corporation, the
sole member of Martin Resource LLC, the sole member of Martin Operating GP LLC,
the general partner of Martin Operating Partnership L.P., and that he, being
authorized so to do, executed the foregoing instrument for the purposes therein
contained, by signing the name of the company by himself as noted above.

         IN WITNESS WHEREOF, I hereunto set my hand and official seal.


                                                    /s/ Adam Gallegos
                                                    Notary Public
My Commission Expires: 10-17-2004






                                       6

<PAGE>
                                   EXHIBIT A

                                   THE LEASE


                        [TAMPA PORT AUTHORITY LETTERHEAD]

                          LANDLORD ESTOPPEL CERTIFICATE

                                November 8, 2000,


Re:      Ground Lease Agreement dated December 16, 1976, together with all
         amendments thereto (collectively, the "LEASE")

         Landlord: Tampa Port Authority ("LANDLORD")

         Tenant:   Martin Gas Sales, Inc ("TENANT")

         Premises: All that certain parcel or parcels of land, the same being
                   situated in Hillsborough County, Florida, and commonly
                   referred to as "4118 Pendola Point Road", consisting of
                   approximately 9.94 acres as more particularly described and
                   set forth in Exhibit "A" of that certain ground lease
                   agreement dated December 16, 1976. (the "PREMISES").

Gentlemen:

         The Tampa Port Authority is the current Landlord under the Lease. We
give you this certificate to permit you to rely on it as conclusive evidence of
the matters stated below. We warrant and represent to you as follows:

         1.       Attached hereto as Schedule A is a true, correct and complete
                  copy of the Lease, including all amendments and modifications.
                  The attached lease documents represent the entire agreement
                  between Landlord and Tenant as of the date of this certificate
                  and the Lease has not been otherwise assigned, amended,
                  supplemented or modified except for the Landlord's consent to
                  a sublease with CF Martin Sulphur, LP, a Delaware limited
                  partnership, for operation of the sulphur facilities on the
                  site. The Lease is the only lease between the Tenant and the
                  Landlord affecting the Premises.

         2.       On the date of this certificate the Lease is in full force and
                  effect according to its terms.



<PAGE>

         3.       No action or proceeding has been instituted by the Landlord
                  against the Tenant under the Lease in any federal or state
                  court, and on the date of this certificate, the Landlord has
                  no actual knowledge of a default by the Tenant under the
                  Lease. The Landlord has not examined the Premises to verify
                  the condition thereof or to verify that no nonmonetary
                  defaults exist. Landlord has not given or received a notice of
                  default under the Lease.

         4.       Landlord hereby acknowledges that the Tenant intends to
                  sublease a portion of the Premises to CF Martin Sulphur LP
                  pursuant to the terms of the document attached hereto as
                  Schedule A-1 (the "Sublease"). The Landlord has consented to
                  the grant of the Sublease.

         5.       The person signing this letter on behalf of Landlord is a duly
                  authorized agent of the Landlord.

         We understand that you will rely on the certifications set forth above.

                                    Sincerely,

                                    LANDLORD:

                                    TAMPA PORT AUTHORITY, a body politic and
                                    corporate under and by virtue of the Laws of
                                    the State of Florida, and of Hillsborough
                                    County, and, as the governing body of the
                                    Hillsborough County Port District


                                    By: /s/ [ILLEGIBLE]
                                       -----------------------------------
                                     Name: [ILLEGIBLE]
                                          --------------------------------
                                     Title: [ILLEGIBLE]
                                           -------------------------------


CEK:bap


<PAGE>

                      AMENDMENT NO. 8 TO AGREEMENT OF LEASE

         This Amendment No. 8 to Agreement of Lease ("AMENDMENT") made and
entered into as of this 16th day of December, 1996, by and between the TAMPA
PORT AUTHORITY, a body politic and corporate organized and existing under the
laws of the State of Florida ("LESSOR"), and MARTIN GAS SALES, INC., a Texas
corporation ("LESSEE"), successor in interest to Boliden Chemicals, Inc., a
Delaware corporation.

                                   WITNESSETH:

         WHEREAS, the Lessee currently leases approximately ten (10) acres of
land at Port Sutton ("PREMISES") from Lessor under the terms and provisions of a
December 16, 1976 Agreement of Lease ("ORIGINAL LEASE"), as amended on May 21,
1980 ("FIRST AMENDMENT"), October 10, 1980 ("SECOND AMENDMENT") August 15, 1984
("THIRD AMENDMENT") July 13, 1987 ("FOURTH AMENDMENT"), December 5, 1988 ("FIFTH
AMENDMENT"), February 16, 1989 ("SIXTH AMENDMENT"), May 13, 1992 ("SEVENTH
AMENDMENT") and March 30, 1995 (Original Lease, as amended, is collectively
referred to as the "LEASE"); and,

         WHEREAS, Paragraph 23 of the Lease provides that the Lessee shall have
the option to extend the Lease for ten (10) years and provides that in the event
of an extension, the rental rate, the inbound and outbound wharfage guarantees
and the minimum charge relative to the Vessel Moorings System shall be increased
in the manner set forth in Paragraph 23; and,

         WHEREAS, Lessee has notified the Lessor of its intent to exercise the
final ten (10) year renewal term; and,

         WHEREAS, the parties wish to amend the Lease to document the ten (10)
year renewal term, to increase the rental rate, the wharfage guarantees, and the
Vessel Moorings System charge, and to modify Lessee's permitted use of the
Premises to allow for Lessee's handling of anhydrous ammonia at the Premises.



<PAGE>

         NOW, THEREFORE, in consideration of the covenants contained herein and
the sum of Ten Dollars ($10.00) and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
hereby covenant and agree as follows:

         1. All of the foregoing recitals are incorporated by reference to the
same force and effect as if repeated in this Paragraph.

         2. The term of the Lease is hereby extended ten (10) years commencing
on December 16, 1996 and ending on December 15, 2006.

         3. The first sentence of Paragraph 3 of the Original Lease is hereby
deleted and replaced with the following sentence:

                  The leased premises shall be used solely and only for the
                  storage and handling of petroleum products, sulfuric acid,
                  molten sulphur, asphalt and derivatives thereof and anhydrous
                  ammonia.

         4. The Lease, as amended by Article 3, Paragraph 1(a)(i) of the First
Amendment, Article 2 of the Fourth Amendment, Article 2 of the Fifth Amendment,
and Article 2 of the Seventh Amendment, is further amended to provide that:

                  The bare land rental rate shall be increased to $84,480.00
                  annually, to be paid in twelve (12) equal monthly installments
                  of $7,040.00, together with any applicable sales and/or rental
                  tax due thereon, due and payable in advance of each month.

         5. This Lease, as amended by Article 3, Paragraph 1(a)(ii) of the
First Amendment, Article 2 of the Second Amendment, Article 3 of the Fourth
Amendment, Article 3 of the Fifth Amendment, Article 2 of the Sixth Amendment
and Article 3 of the Seventh Amendment, is further amended to provide that:



                                       2
<PAGE>

                  The wharfage rate for petroleum products, sulfuric acid, and
                  anhydrous ammonia shall be assessed at the established rate of
                  the Tampa Port Authority's tariffs, as amended from time to
                  time, and shall apply towards Lessee's minimum annual wharfage
                  guarantees.

                  Once Lessee has reached its outbound wharfage guarantee limit,
                  the applicable outbound wharfage rate shall be reduced to
                  fifty percent (50%) of the Tampa Port Authority's tariff rate
                  for the remaining portion of the Lease year.

                  Wharfage Guarantees shall be increased as follows:

                  a. The wharfage guarantee for inbound movements of petroleum
                  products, sulfuric acid, molten sulphur, asphalt and
                  derivatives thereof and anhydrous ammonia shall be $84,480.00
                  annually, together with any applicable sales or other tax due
                  thereon.

                  b. The wharfage guarantee for outbound movements of petroleum
                  products, sulfuric acid, molten sulphur, asphalt and
                  derivatives thereof and anhydrous ammonia shall be $18,665.00
                  annually, together with any applicable sales or other tax due
                  thereon.

         6. The Lease, as amended by Article 3, Paragraph 2(b) of the First
Amendment, Article 3 of the Second Amendment, Article 4 of the Fifth Amendment,
and Article 4 of the Seventh Amendment, is further amended to provide that the
Vessel Mooring Charge (in lieu of dockage charge) shall be $32,920.00 annually,
together with any applicable sales or other tax due thereon.

         7. Except as herein expressly amended, all other terms, conditions and
covenants of the Lease, as previously amended, shall remain the same.

         IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their duly authorized officers on the day and year first above
written.



                                       3
<PAGE>

Signed, sealed and delivered              TAMPA PORT AUTHORITY
in the presence of:
                                          By: /s/ ROBERT N. STEINER
/s/ [ILLEGIBLE]                               -------------------------------
-----------------------------------           ROBERT N. STEINER
                                              Its: Port Director
/s/ [ILLEGIBLE]
-----------------------------------       MARTIN GAS SALES, INC., a
                                          Texas corporation
/s/ [ILLEGIBLE]
-----------------------------------       By: /s/ RUBEN S. MARTIN, III
                                              -------------------------------
/s/ JAMES E. McINTYRE                             RUBEN S. MARTIN, III
-----------------------------------               Its: President

                                              [CORPORATE SEAL]




                                       4
<PAGE>
                 CONSENT TO ASSIGNMENT AND ATTORNMENT AGREEMENT

         Subject to the terms and conditions hereinafter set forth, TAMPA PORT
AUTHORITY ("Lessor") hereby consents to the Assignment and Assumption Agreement
between BOLIDEN CHEMICALS, INC., ("BCI"), whose address is 3379 Peachtree Road,
Suite 300, Atlanta, GA 30326 and MARTIN GAS SALES, INC., ("Lessee"), whose
address is P. O. Box 191, Kilgore, TX 75663-0192, dated March 28, 1995
("Assignment") and attached hereto as Exhibit "A," upon the following terms and
conditions:

                                   Background

A. BCI currently leases approximately ten (10) acres of land situated in Tampa,
Florida ("Premises") from Lessor under the terms and provisions of a December
16, 1976 Lease Agreement, as amended May 21, 1980, October 10, 1980, August 15,
1984, July 13, 1987, December 5, 1988, February 16, 1989, and May 13, 1992
("collectively referred to as the Lease"):

B. This Consent is required by the Lease, and issued at the express request of
BCI and Martin Gas Sales, Inc. This Consent replaces BCI with Martin Gas Sales,
Inc. as "Lessee" under the Lease from and after the effective date of the
Assignment and does not in any way expand the obligations of BCI under the
Lease existing prior to the effective date of this Consent.

C. The basic rent, supplemental payments and other fees currently payable by BCI
to Lessor pursuant to the Lease are as follows:

1.      Bare Land Rent:            $66,948.00 ann./$5,579.00 mo.

2.      Wharfage Rate:             The wharfage rate for petroleum and
                                   sulphuric acid shall be assessed at the
                                   Tampa Port Authority's established rate and
                                   shall apply toward Lessee's minimum annual
                                   wharfage guarantees.

                                   Once Lessee has reached its outbound wharfage
                                   guarantee limit the applicable outbound
                                   wharfage rate shall be reduced to fifty (50)
                                   percent of the tariff rate for the remaining
                                   portion of the lease year.



<PAGE>

3.       Wharfage Guarantee:

         a.           The wharfage guarantee for inbound movements of petroleum
                 and sulphuric acid products shall be $66,948.00 annually.

         b.           The wharfage guarantee for outbound movements of petroleum
                 and sulphuric acid products shall be $14,784.00 annually.

4.       Vessel Mooring Charge:

         Vessel Mooring Charge (in lieu of dockage charge) shall be $26,088.00
annually, to be paid monthly in advance at a rate of $2,174.00.

                         Terms and Conditions of Consent

The Assignment is hereby approved by Lessor, subject to the terms of the Lease
and the terms of this Consent:

         1. The Lease, as described above, is in full force and effect and, to
Lessor's knowledge, no default exists thereunder.

         2. Lessor hereby consents to the Assignment, provided that the consent
of Lessor evidenced hereby is subject to the following:

         a) Unless otherwise expressly stated in this Consent, nothing in the
         Assignment shall supersede or limit the continued effectiveness of the
         provisions of the Lease, which provisions remain in full force and
         effect. In the event of any conflict between the provisions of the
         Lease and the Assignment, the Lease shall control.

         b) The execution and delivery of this Consent shall not affect the
         rights of Lessor under the Lease with respect to future subleases,
         transfers or assignments of the Lease.

         c) Lessor shall be entitled to prompt written notice from Lessee and
         BCI of any amendment, modification, or termination of the Assignment by
         either party thereto.



                                       2
<PAGE>

         d) Notwithstanding the execution and delivery of this Consent, no
         person or entity, heretofore so liable in whole or in part, is to be
         deemed released hereby from liability to Lessor for the full and due
         performance of the Lease, provided that Lessor agrees to look first to
         Martin Gas Sales Inc., as Lessee, for fulfillment of all performance
         obligations applicable to Lessee under the Lease from and after the
         effective date of the Assignment, and shall seek such performance from
         BCI under the Lease only in the event Lessee fails or refuses in such
         performance, and, provided further, as between Lessor and BCI but not
         otherwise, that BCI shall be fully released and forever discharged from
         all obligations under the Lease as of and from and after the Lease
         expiration date, i.e., December 15, 1996, except for any costs and
         expenses, including attorneys' fees resulting from any violations of
         federal, state or local laws, statutes, rules, regulations or
         ordinances during the term of the Lease up to March 28, 1995.

         e) No provision of the Assignment shall be held to impose upon Lessor
         any obligations or liabilities not expressly provided for in the Lease.

         3. Notwithstanding any contrary provision of the Lease:

         (A) Paragraph No. 7 of the Agreement of Lease is hereby amended by
adding with the following:

                                    INSURANCE

                  During the life of this Lease, from and after March 28, 1995,
Lessee shall provide, pay for, and maintain with insurance companies
satisfactory to the Lessor, the types of insurance described herein.

                  (a) Insurance Requirements. All insurance shall be from
responsible insurance companies eligible to do business in the State of Florida.
All Liability Policies shall provide that the Lessor is an Additional Insured as
to the operations of Lessee under this Lease and shall also provide the
Severability of Interest Provision. The insurance coverages and the limits
required must be evidenced by properly executed Certificates of Insurance on
forms which are to be furnished by the Lessor. The Certificate must be
personally manually signed



                                       3
<PAGE>

by the Authorized Representative of the insurance company shown in the
Certificate with proof that he/she is an authorized representative thereof. In
addition, certified, true and exact copies of all insurance policies required
shall be provided the Lessor, on a timely basis, if requested by the Lessor. The
required policies of insurance shall be performable in Hillsborough County,
Florida, and shall be construed in accordance with the laws of the State of
Florida.

                  Thirty (30) days prior written notice by registered or
certified mail shall be given the Lessor of any cancellation, intent not to
renew, or reduction in the policies' coverage amount in the application of the
Aggregate Limits Provisions. In the event of a reduction in any Aggregate Limit,
Lessee shall take immediate steps to have it reinstated to not less than the
minimum amount specified in the Lease. If at any time the Lessor requests a
written statement from the insurance company as to any impairments to the
Aggregate Limit, Lessee shall promptly authorize and have delivered such
statement to the Lessor. Lessee shall make up any impairment when known to it to
the extent necessary to maintain the minimum Aggregate Limit specified above.
Lessee authorizes the Lessor and its Insurance Consultant to confirm all
information furnished the Lessor, as to its compliance with its Bond and
Insurance Requirements, with Lessee's insurance agents, brokers, surety and
insurance carriers. All insurance coverages of Lessee shall be primary to any
insurance or self-insurance program carried by the Lessor for this Lease.

                  No occupancy of the Premises shall commence at the Premises
unless and until the required Certificates of Insurance are in effect.

                  If any General Liability Insurance required herein is to be
issued or renewed on a "claims made" form as opposed to the "occurrence" form,
the retroactive date for coverage shall be no later than the date of the
Assignment of the Lease. In addition, Lessee covenants that in the event of
cancellation or non-renewal of any such policy, or if any such policy is
replaced with a new policy that does not have an effective commencement date
which is the same as the date of the Assignment, then Lessee shall obtain such
coverage as shall be necessary for the discovery period for insurance claims
(Tail Coverage) under such non-renewal or cancelled policy to be not less than
the applicable Statutes of Limitations.



                                       4
<PAGE>

                  All of the required insurance coverages shall be issued as
required and policies shall be endorsed, where necessary, to comply with the
minimum requirements contained herein. Renewal Certificates of Insurance on the
Lessor's form must be provided the Lessor ten (10) days prior to expiration of
current coverages so that there shall be no interruption in Lessee's occupancy
due to lack of proof of the insurance coverages required of Lessee in this
Lease. Should at any time Lessee not provide or maintain the insurance coverages
required in this Lease, the lessor may terminate or suspend this Lease.

                  The amounts and types of insurance shall conform to the
following minimum requirements with the use of Insurance Service Office (ISO)
policies, forms, and endorsements or broader where applicable. Notwithstanding
the foregoing, the wording of all policies, forms and endorsements must be
acceptable to the Lessor.

                  (b) Insurance Coverages and Limits.

                  (1) Commercial General Liability Insurance shall be maintained
         by Lessee. Coverage shall include but not be limited to Premises and
         Operations, Personal Injury, Contractual, Independent Contractors,
         Broad Form Property Damage including Completed Operations and Products
         & Completed Operations Coverages and shall not exclude coverage for the
         "X" (explosion), "C" (collapse) and "U" (underground) Property Damage
         Liability exposures.

                  Completed Operations Liability Coverage shall be maintained
for a period of not less than two (2) years following termination of this Lease
Agreement.

                  Limits of Coverage shall not be less than:

Bodily Injury & Property
Damage Liability                    $l,000,000.00     Combined Single Limit Each
                                                      Occurrence and Aggregate.
                                                      The General Aggregate
                                                      limit shall be separately
                                                      applicable to this
                                                      specific Lease.




                                       5
<PAGE>
Should Lessee's General Liability Insurance be written or renewed on the
Comprehensive General Liability form, the limits of coverage required shall not
be less than:

Bodily Injury Liability             $1,000,000.00     Limit Each Occurrence

Damage Liability                    $1,000,000.00     Limit Each Occurrence

                                       or

Bodily Injury & Property
Damage Liability                    $1,000,000.00     Combined Single Limit Each
                                                      Occurrence

                  (2) Automobile Liability Insurance shall be maintained by
         Lessee as to the ownership, maintenance, and use of all owned,
         non-owned, leased or hired vehicles to be used on the Premises with
         limits of not less than:

Bodily Injury Liability             $1,000,000.00     Limit Each Person
                                    $1,000,000.00     Limit Each Accident


Property Damage
Liability                           $1,000,000.00     Limit Each Accident

                                       or

Bodily Injury & Property
Damage Liability                    $1,000,000.00     Combined Single Limit Each
                                                      Accident

                  (3) Umbrella Liability Insurance shall be maintained by Lessee
         with a limit of not less than $3,000,000.00 each occurrence and
         aggregate. The limits of Primary Liability Insurance for the General
         Liability, Automobile Liability and Employers' Liability Insurance
         Coverages required in this section shall be not less than:

Bodily Injury, Personal
Insurance and Property
Damage Liability                    $1,000,000.00     Combined Single Limit and
                                                      Aggregate Limit,
                                                      where applicable



                                       6
<PAGE>

         (B) Lessee and not BCI expressly assumes, and agrees to be responsible
to Lessor for, the covenants of, and the indemnifications of Lessor by, Lessee
under the provisions of the "Environmental Addendum to Lease" attached hereto
and made a part hereof as Exhibit "B". The environmental provisions starting at
line 4, page 4 of Amendment No. 4 to Agreement of Lease and continuing through
line 28, page 5 of Amendment No. 4 to Lease are hereby stricken and replaced
with the provisions set forth in Exhibit "B".

         4. The undersigned Lessee and BCI, respectively, covenant and agree to
be bound by the terms of this Consent.

         5. Lessee hereby attorns to Lessor and agrees to keep and perform all
the covenants and obligations of Lessee under the Lease, and the "Environmental
Addendum to Lease" attached hereto, as so assigned effective as of the date
hereof.

         6. Lessee represents and covenants that it will only conduct business
on the Premises under the name of Martin Gas Sales, Inc., a Texas corporation,
and will not conduct business on the Premises under any other name or permit any
other person or entity to conduct business from or on the Premises without the
prior written consent of the Lessor, provided that duly authorized customers of
Lessee shall be entitled to conduct business on the Premises to the extent as
part of an operator/customer relationship established in the ordinary course of
business. Lessee agrees that with respect to entities other than Lessee which
are controlled by Lessee, or which are under common control with the Lessee, it
shall be responsible for and pay to the Lessor any charges, commissions,
assessments, wharfage or dockage fees resulting from any transactions by such
person or entity which arise from the use or occupation of the Premises and
which would be assessable if the entity was a Lessee.

         7. This Consent shall be effective only after the execution of the
Acknowledgement, below, by all of the designated parties, and the delivery of an
original (or original counterparts) hereof executed by Martin Gas Sales, Inc.
and Boliden Chemicals, Inc. to the Lessor.

         8. Notwithstanding any provision of this instrument or the Lease to the
contrary, from the effective date of the assignment of the Lease by Boliden
Chemicals, Inc. to Martin



                                       7
<PAGE>

Gas Sales, Inc. (the "Effective Date of the Assignment") and through the
remaining term of the Lease:

         (a)      The Leased Premises may be used for the storage, handling,
                  terminalling and related functions of petroleum products,
                  sulphuric acid, molten sulphur, asphalt and derivatives
                  thereof.

         (b)      Upon the occurrence of any breach and/or default by Lessee
                  under the Lease, the Lessor shall promptly notify AmSouth Bank
                  of Florida ("AmSouth") in writing at 469 23rd Street, Panama
                  City, Florida 32405, Attention: Robert S. Vanlandingham,
                  telephone: (904) 747-4501, fax: (904) 747-4675. Following
                  receipt of such notice, AmSouth shall have thirty (30) days to
                  cure any such breach or default, and the Lessor hereby agrees
                  that it shall not exercise any available remedies, under the
                  Lease or otherwise, until the expiration of such thirty (30)
                  days period.

         (c)      Martin Gas Sales, Inc. shall have no liability or obligation
                  to the Lessor under the Lease or otherwise with respect to the
                  failure by any such prior lessee to make any payments to the
                  Lessor under the Lease or otherwise.

                                    TAMPA PORT AUTHORITY

                                    By: /s/ JOSEPH L. VALENTI
                                       -----------------------------------------
                                    Name: Joseph L. Valenti
                                    Title: Port Director

                                    Date: March 30, 1995
                                          --------------------------------------



                                       8
<PAGE>

Acknowledgement

         The foregoing Consent to Assignment and Attornment Agreement by TAMPA
PORT AUTHORITY is hereby accepted and approved, and the undersigned hereby
acknowledge that complete copies of the instruments comprising the Lease, as
defined above, have been delivered to Martin Gas Sales, Inc.

                                    MARTIN GAS SALES, INC.,
                                    a Texas corporation

                                    By: /s/ RUBEN S. MARTIN III
                                       -----------------------------------------
                                    Name: Ruben S. Martin III
                                    Title: President

                                    Date: 3/30/95
                                         ---------------------------------------

                                    BOLIDEN CHEMICALS, INC.,
                                    a Delaware corporation

                                    By: /s/ WILLIAM F. MASON
                                       -----------------------------------------
                                    Name: William F. Mason
                                         ---------------------------------------
                                    Title: President
                                          --------------------------------------

                                    Date: March 30, 1995
                                         ---------------------------------------



                                       9
<PAGE>

                                  EXHIBIT "A"

Assignment and Assumption Agreement between Boliden Chemicals, Inc. and Martin
Gas Sales, Inc., dated March 28, 1995.






<PAGE>

                                   EXHIBIT "B"

                         ENVIRONMENTAL ADDENDUM TO LEASE

         This Addendum is effective from and after March 28, 1995 and applies
exclusively to Martin Gas Sales, Inc. and not to Boliden Chemicals, Inc.

                  (a) Definitions for Environmental Provisions. The following
terms, as used in the environmental provisions of this Lease Agreement, shall
have the meanings indicated:

                  "CERCLA" means the Comprehensive Environmental Response,
         Compensation and Liability Act of 1980 (42 USC Sections 9601, et seq.),
         as amended from time to time, including without limitation, the
         Superfund Amendments and Reauthorization Act of 1986 ("SARA").

                  "CERCLIS" means the Comprehensive Environmental Response,
         Compensation and Liability Information System, or any other information
         system, established pursuant to CERCLA.

                  "Environmental Law" means any applicable federal, state or
         local law, statute, code, ordinance, or common law, whether now in
         existence or established, enacted or amended during the term of this
         Lease Agreement, relating to pollution, protection of the environment,
         health, industrial hygiene, Hazardous Substances (including, without
         limitation, the manufacture, generation, distribution, use, treatment,
         storage, disposal, transport or handling thereof), including but not
         limited to CERCLA, SARA, RCRA, the Florida Resource Recovery and
         Management Act (Florida Statutes Sections 403.701, et seq.), and the
         Pollutant Spill Prevention and Control Act (Florida Statutes Sections
         376.011 through 376.17 and 376.19 through 376.21)

                  "Environmental Regulation" means any applicable regulation or
         rule promulgated by any Environmental Regulator.

                  "Environmental Regulator" means any federal, state or local
         governmental or quasi-governmental unit, body or agency which is
         charged with regulating the environment or Hazardous Substances, or
         which is charged with enforcing


<PAGE>

         any Environmental Law or Environmental Regulation, including, without
         limitation, the U.S. Environmental Protection Agency ("EPA"), or the
         Florida Department of Environmental Protection ("FDEP").

                  "Hazardous Substance" means asbestos, polychlorinated
         biphenyls, petroleum products and distillates, and any other
         substances, materials and wastes which are or become regulated or
         controlled by any Environmental Law or Environmental Regulation
         applicable at any time to the use by Lessee, its agents or invitees of
         the Leased Premises during the term of this Lease Agreement, including,
         without limitation, those within the definition of "hazardous
         substances," "hazardous materials," "hazardous wastes," "toxic
         substances," "solid waste," "pollutants," "contaminants," or "nuclear
         or byproduct material" in any such Environmental Law or Environmental
         Regulation.

                  "National Priorities List" means the National Priorities List
         established pursuant to CERCLA or any other list identifying hazardous
         or toxic waste sites maintained or controlled by any Environmental
         Regulator.

                  "RCRA" means the Resource Conservation and Recovery Act of
         1976 (42 USC Sections 6901, et seq.), as amended from time to time.

                  (b) Environmental Covenants of Lessee. Lessee covenants and
warrants, as applicable, that at all times during the term of this Lease
Agreement:

                           (1) The Leased Premises shall not be used by Lessee,
         its agents or invitees for the storage or generation of any Hazardous
         Substance in violation of any Environmental Law, Environmental
         Regulation, order of an Environmental Regulator.

                           (2) No Hazardous Substance will be released or
         disposed of on the Leased Premises by Lessee, its agents or invitees in
         violation of any Environmental Law, Environmental Regulation, order of
         an Environmental Regulator.



                                        2
<PAGE>

                           (3) Lessee and its agents and invitees shall comply
         with all permits and/or licenses issued by Environmental Regulators
         with respect to the conduct by Lessee, its agents or invitees of
         operations governed by this Lease Agreement.

                           (4) If Lessee shall receive any notice regarding the
         Leased Premises from any Environmental Regulator of any violation or
         suspected violation of any Environmental Law or Environmental
         Regulation, or relating to any clean-up, remediation or other response
         action or threat thereof, then Lessee shall notify the Lessor within
         24 hours thereof, and of all subsequent developments related thereto.

                           (5) To the best of Lessee's knowledge, no properties
         owned, operated or controlled by Lessee are listed on the National
         Priorities List or with CERCLIS, and, except for certain properties of
         Lessee not related to the Premises, no Environmental Regulator or any
         third party has demanded any right of recovery, nor brought or
         threatened to bring any action, cause of action, suit or proceeding
         against Lessee seeking recovery for payment or reimbursement for
         clean-up costs, damages or other costs incurred under or pursuant to
         any Environmental Law or Environmental Regulation.

                  (c) Covenant Not To Store Hazardous Substances In Violation of
Law. Lessee, for itself, its agents and invitees, covenants and agrees not to
use the Leased Premises, at any time, for:

                           (1) the storage, generation, release or disposal of
         any Hazardous Substance in violation of any Environmental Law or
         Environmental Regulation, any order of an Environmental Regulator, or
         any permit issued by an Environmental Regulator;

                           (2) any purpose that would give rise to a clean-up,
         remediation or other response action; to the imposition of any fine,
         penalty, assessment, cost, forfeiture or imposition for violation of an
         Environmental Law or Environmental Regulation; or to a claim, claim of
         lien or lien (whether against the Leased Premises, the Lessor or the
         Lessor's properties) for response costs,



                                       3
<PAGE>

         damages or other costs pursuant to any Environmental Law or
         Environmental Regulation; or,

                           (3) any purpose that would cause the Leased Premises
         to be listed on the National Priorities List or with CERCLIS.

                           In furtherance of the foregoing, Lessee also agrees
that it will not use, operate or maintain any other properties it owns, operates
or controls in a manner which would give rise to a claim, claim of lien or lien
against the Lessor, the Leased Premises, or Lessee's interests under this Lease
Agreement under any Environmental Law or Environmental Regulation.

                           The Lessor may, upon reasonable grounds for
insecurity, request in writing, assurances, in reasonable form and content,
concerning the environmental covenants and warranties made by Lessee in this
Lease Agreement. The Lessor shall state in its request for assurances the
specific grounds for insecurity with respect to the environmental covenants and
warranties of this Lease Agreement. The Lessor may obtain such assurances, at
the Lessor's option, from a duly authorized agent of Lessee.

                  (d) Release of Hazardous Materials; Claim. Lessee agrees to
notify the Lessor within 24 hours of an occurrence or any release or disposal of
any Hazardous Substance of any kind in, on, about or under the Leased Premises
regardless of the source or other circumstances thereof to the extent any such
release or disposal is required to be reported under Environmental Law or
Environmental Regulation.

                           Further, Lessee shall, within 24 hours, notify the
Lessor in writing of the receipt of any notice, order, correspondence or
communication that:

                           (1) a permit is required from any Environmental
         Regulator for the use or operation by Lessee, its agents or invitees
         upon the Leased Premises;

                           (2) a summons, citation; order directing compliance
         or inquiry has been or is being issued or made by any Environmental
         Regulator with respect to the Leased Premises;


                                       4

<PAGE>

                           (3) any Environmental Regulator or third party has
         demanded or asserted any right of recovery for payment or
         reimbursement, or any claim, claim of lien or lien against the Leased
         Premises for clean-up costs, damages, or other costs incurred, under or
         pursuant to any Environmental Law, Environmental Regulation, or the
         common law;

                           (4) the Leased Premises are or will be listed on the
         National Priorities List or with CERCLIS;

                           (5) any fine, penalty, assessment, cost, forfeiture
         or imposition has been, or will be or is sought to be imposed against
         Lessee, its agents or invitees, or the Lessor, for violation or
         asserted violation by Lessee, its agents or invitees of any
         Environmental Law, Environmental Regulation, any order of an
         Environmental Regulator or any permit issued by an Environmental
         Regulator with respect to the Leased Premises; or,

                           (6) any clean-up, remediation or other response
         action pursuant to any Environmental Law or Environmental Regulation
         has been, is being, or will be, commenced by any Environmental
         Regulator or third party with regard to (1) the Leased Premises or (2)
         any other properties owned, operated or controlled by Lessee which
         would give rise to a claim, claim of lien or lien against the Leased
         Premises.

                  (e) Clean-up Plan. In the event of any determination that,
through actions by or attributable in any manner to Lessee, its agents or
invitees, any Hazardous Substance has been stored, generated, located, released
or disposed of in, on, about or under the Leased Premises in violation of any
Environmental Law, Environmental Regulation, order of an Environmental
Regulator, or any permit issued by an Environmental Regulator with respect to
the Leased Premises, Lessee shall so notify the Lessor within 24 hours.

                           Further, in each such instance, Lessee shall, at
Lessee's sole cost and expense, within 24 hours notify and keep the Lessor fully
informed of response actions proposed or necessary for clean-up or remediation,
the details of plans and specifications therefor, and all developments related
thereto with respect to the Leased Premises. As soon as reasonably



                                        5
<PAGE>

possible, after obtaining all necessary approvals, permits and/or licenses of
all appropriate governmental or quasi-governmental units, bodies or agencies,
including without limitation Environmental Regulators, Lessee shall diligently
prosecute the accomplishment of the response actions contemplated herein with
respect to the Leased Premises, at Lessee's sole cost and expense.

                  (f) Continuing Nature. The environmental provisions of this
Lease Agreement shall survive the termination of the Lease Agreement, such
provisions to continue in full force and effect so long as the possibility of
any environmental liability, claim, obligations, or leases of the Lessor with
respect to the Leased Premises, attributable to Lessee, its agents or invitees,
shall exist. However, Lessee may limit its liability and obligations under the
environmental provisions of this Lease by obtaining environmental audits of the
Leased Premises before the effective date of the Assignment and after the
Termination of the Lease Term, at Lessee's sole expense, prepared by
environmental consultants acceptable to the Lessor (which acceptable consultants
shall include Ash Environmental Engineering, Inc., St. Petersburg, Florida), to
determine if Lessee has caused any Hazardous Substances to be released or
disposed of in, on, about, or under the Leased Premises in violation of any
Environmental Law, Environmental Regulation, order of an Environmental
Regulator, or any permit issued by an Environmental Regulator. Lessee shall
provide copies of all such environmental audits to the Lessor. In the event that
the environmental audits substantiate that Lessee has not caused any Hazardous
Substances to be released or disposed of in, on, about, or under the Leased
Premises in violation of any Environmental Law, Environmental Regulation, order
of an Environmental Regulator, or any permit issued by an Environmental
Regulator, then Lessee's obligations under the environmental provisions of this
Lease shall cease.

                  (g) Radon Gas. Radon is a naturally occurring radioactive gas
that, when it has accumulated in a building in sufficient quantities, may
present health risks to persons who are exposed to it over time. Levels of radon
that exceed Federal and State guidelines have been found in buildings in
Florida. Additional information regarding radon and radon testing may be
obtained from your County Public Health Unit. Each party hereto disclaims any
liability for any health risks incurred by the other, its employees, and/or its
invitees as a result of, or claimed to be a result of, radon at the Leased
Premises.



                                        6
<PAGE>
                      ASSIGNMENT AND ASSUMPTION AGREEMENT


         This Agreement made this 28th day of March, 1995, by and between
Boliden Chemicals, Inc. ("BCI") and Martin Gas Sales, Inc. ("Martin").

                                   WITNESSETH:

         WHEREAS, Port Sutton, Inc. and Eastern Seaboard Petroleum Company
previously entered into an Agreement of Lease dated December 16, 1976 (the
"Lease", including all amendments to date) which Lease was amended by the
parties on May 21, 1980, and October 10, 1980; and

         WHEREAS, Eastern Seaboard Petroleum Company assigned the Lease to
Steuart Petroleum Company on August 14, 1984 which Lease was amended by the
parties on August 15, 1984; and

         WHEREAS, Port Sutton assigned the said Lease on September 21, 1984 to
Tampa Port Authority ("TPA"); and

         WHEREAS, the TPA and Steuart Petroleum Company amended said Lease on
July 13, 1987, and December 5, 1988, and

         WHEREAS, Steuart Petroleum assigned the Lease to BCI on February 16,
1989; and

         WHEREAS, TPA and BCI amended said Lease on February 16, 1989; and

         WHEREAS, TPA and BCI amended said Lease on May 13, 1992; and

         WHEREAS, BCI and Martin, contemporaneously with the execution of this
Agreement, have executed an Asset Purchase and Sale Agreement whereunder BCI
conveys to Martin BCI's Tampa Terminal assets and a commitment to assign the
Lease to Martin; and

         WHEREAS, this document evidences BCI's willingness to assign its rights
in the Lease to Martin and Martin's willingness to agree to and accept such
assignment.

         NOW, THEREFORE, the parties hereto, in consideration of the covenants,
terms and conditions contained herein, and the sum of One Dollar ($1.00),
receipt of which is herewith acknowledged by each party, hereby covenant and
agree as follows:



<PAGE>
                                       -2-


         1. BCI herewith assigns and transfers to Martin all of its right, title
and interest in the Lease and Martin accepts such assignment and transfer.

         2. BCI and Martin acknowledge that the consent of the Lessor under the
Lease to this Assignment and Assumption Agreement is a pre-condition to the
effectiveness of this Agreement and each agrees to timely execute a consent with
said Lessor in form reasonably acceptable to each party and its respective
counsel.

         3. Martin agrees to assume all responsibilities as Lessee under the
Lease and to hold harmless and indemnify BCI, its directors, officers and
stockholders, from and against any liability arising under the Lease except any
such liability expressly retained by BCI under the terms of the Asset Purchase
and Sale Agreement above referenced and except any such liability expressly
undertaken or retained by BCI under the terms of the Consent to Assignment and
Attornment Agreement, dated ____________, 1995, by and between BCI, Martin and
the Tampa Port Authority.

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives the day and year first above
written.


BOLIDEN CHEMICALS, INC.                     MARTIN GAS SALES, INC.


/s/ WILLIAM F. MASON                        /s/ RUBEN S. MARTIN, III
----------------------------------          ----------------------------------
By: William F. Mason                        By: Ruben S. Martin, III
Its: President                              Its: President



<PAGE>
                     AMENDMENT NO. 7 TO AGREEMENT OF LEASE


         This Amendment No. 7 to Agreement of Lease made and entered into this
13th day of May, 1992, by and between the TAMPA PORT AUTHORITY, a body politic
and corporate organized and existing under the laws of the State of Florida,
hereinafter referred to as "Lessor", and BOLIDEN CHEMICALS INC., hereinafter
referred to as "Lessee".

                                   WITNESSETH:

         WHEREAS, Port Sutton, Inc. and Eastern Seaboard Petroleum Company
previously entered into an Agreement of Lease dated December 16, 1976 which was
amended by the parties on May 21, 1980, and October 10, 1980; and

         WHEREAS, Eastern Seaboard Petroleum Company assigned its Lease to
Steuart Petroleum Company on August 14, 1984 which Lease was amended by the
parties on August 15, 1984; and

         WHEREAS, Port Sutton assigned the said Lease on September 21, 1984 to
Lessor; and

         WHEREAS, the Lessor and Steuart Petroleum Company amended said
Agreement of Lease on July 13, 1987, and December 5, 1988, and

         WHEREAS, Steuart Petroleum Company assigned its Lease to Lessee on
February 16, 1989; and

         WHEREAS, the Lessor and the Lessee amended said Lease on 16 February
1989; and

         WHEREAS, the parties desire to further amend such Agreement of Lease.

         NOW, THEREFORE, the parties hereto, in consideration of the covenants
contained herein and the sum of One Dollar ($1.00) each to the other in hand
paid, hereby covenant and agree as follows:

         1. Term of this Lease shall be extended for seven (7) years, commencing
December 16, 1989 and ending December 15, 1996.

         2. This Lease, Article 3, Paragraph 1 (a)(i) of the First Amendment and
Article 2 of the Fifth Amendment to Agreement of Lease, is amended to provide
that the bare land rental rate shall be increased to $66,948.00 annually, to be
paid monthly in advance at a rate of $5,579.00.



<PAGE>

         3. This Lease, Article 3, Paragraph 1 (a)(ii) subparagraphs A and B of
the First Amendment to Agreement of Lease and Article 2 of the Second Amendment
to Agreement of Lease, and Article 3 of the Fifth Amendment to Agreement of
Lease, and Article 2 of the Sixth Amendment to the Agreement of Lease, is
amended to provide that the wharfage guarantee on inbound movements of petroleum
and sulphuric acid products shall be increased to $66,948.00 annually, and the
wharfage guarantee on outbound movements of petroleum and sulphuric acid
products shall be increased to $14,784.00 annually.

         The wharfage rate for petroleum and sulphur acid products shall be at
the rates established by Tampa Port Authority Tariff No. 11 and any revisions
thereto, and shall apply toward the minimum wharfage guarantee.

         During any lease year, once Lessee has reached its outbound wharfage
guarantee limit the applicable outbound wharfage rate shall be reduced to fifty
(50) percent of the tariff rate for the remaining portion of the lease year.

         4. This Lease, Article 3, Paragraph 2 (b) of the First Amendment of
Lease and Article 3 of the Second Amendment to Agreement and Article 4 of the
Fifth Amendment to Agreement, is amended as follows:

                  a.       the minimum charge (in lieu of dockage charge)
                           relative to the Vessel Mooring System (VMS) shall be
                           increased to $26,088.00 annually, to be paid monthly
                           in advance at a rate of $2,174.00.

                  b.       In lieu of dockage charge shall be suspended,
                           effective 1 June 1990, and shall be reinstated at the
                           above rate on the first day of the month after Lessor
                           places VMS is service and as more particularly
                           provided for in Article 6 of this Amendment.

         5. Paragraph 23 of the Agreement of Lease as deleted and replaced by
Article 5 of the First Amendment to Agreement of Lease and Article 5 of the
Fifth Amendment to the Agreement, is hereby amended in its entirety to read as
follows:

                  23. Lessee shall have one successive option to renew and
                  extend this Lease, as amended. The renewal shall be for a
                  period of ten (10) years beginning December 16, 1996. Each
                  such option shall be exercised by Lessee by giving written
                  notice to the Lessor no less than ninety (90) days prior to
                  the expiration of the term then in effect. If Lessee does
                  exercise the ten (10) year option period, the rental rate, the
                  inbound and outbound wharfage



                                        2
<PAGE>

                  guarantees and the minimum charge relative to the Vessel
                  Mooring System shall be increased effective upon commencement
                  of said ten (10) year option period to an amount calculated by
                  multiplying the base amount of the charge (as stated in this
                  Amendment) for which the adjustment is being calculated by a
                  fraction whose numerator is The Consumer Price Index, U.S.
                  City Average All Items (Base Year 1967) published by the
                  Bureau of Labor Statistics, U.S. Department of Labor, for the
                  third month prior to the expiration of the term then in
                  effect, and whose denominator shall be said Consumer Price
                  Index, U.S. City Average All Items for the third month prior
                  to the commencement of this Amendment.

                  Should the Bureau of Labor Statistics change the manner of
                  computing the Consumer Price Index, the Bureau shall be
                  requested to furnish a conversion factor designated to adjust
                  the new index to the one previously in use, and adjustment to
                  the new index will be made on the basis of such conversion
                  factor. Should the publication of the Consumer Price Index be
                  discontinued by the Bureau of Labor Statistics, then such
                  other index as may be published by said Bureau most nearly
                  approaching said discontinued index shall be used in making
                  the adjustment herein provided. No additional option fee shall
                  be payable by Lessee with respect to the successive ten (10)
                  year option period.

         6. The Lessor will relocate the existing VMS now sited immediately west
of Berth 24 to an area east of Berth 24, and it is herein agreed that:

                  a.       The Lessor will relocate the VMS at its sole expense,
                           excepting that Lessee shall be responsible for the
                           relocation of any pipelines at its own expense.

                  b.       The "in lieu of dockage charge" shall be suspended
                           until the relocation of the VMS has been completed
                           and will be reinstated as provided for in Article 4
                           (b) of this Lease Amendment.

                  c.       The Lessor, at its sole discretion, will determine
                           the date the VMS will be considered operational and
                           when charges to the Lessee for the use of the VMS
                           will be reinstated, and will be independent of the
                           Lessee's relocation of its pipelines.

                  d.       When the VMS is operational at the site east of Berth
                           24, the Lessee's berthing limits shall be the western
                           boundary limit of Berth 24, which is the western
                           boundary of the Lessee's lease area, and the eastern
                           boundary of the Lessee's lease area, with both
                           boundaries extended into the Port Sutton Terminal
                           Channel.

                  e.       During that period of time pending the completion of
                           the relocation of the VMS, Lessee shall have the
                           right to use Berth 24, for its tugs and bunkering
                           barges, free of charges. Such use is on an
                           as-available basis, subject to operational activities
                           by revenue-producing vessels of said Lessee or other
                           tenants of the Lessor.



                                        3
<PAGE>

                  f.       During the relocation of the VMS to a site east of
                           Berth 24, Lessor agrees, in order to provide
                           clearance for vessels using Berth 24 and to the
                           extent that public berths are not available and there
                           is no expense to the Lessor, Lessee may tie its
                           bunkering barges to other Lessor facilities without
                           charge.

         7. The Lessor and Lessee have agreed to cooperate on a project to
extend the existing rail service along the right-of-way north of Pendola Point
Road and along the southern boundary of the leased premises with a spur track
onto the leased premises (Exhibit A). The project shall be completed under the
following terms and conditions:

                  a.       All construction plans will be coordinated with the
                           Authority's Engineering Department.

                  b.       Lessee shall be the contracting party with the
                           railroad (CSX) for all proposed improvement.

                  c.       Lessee will assume responsibility for all costs
                           associated with the construction of approximately
                           1,300 lineal feet of lead track, spur track,
                           switches, crossings and other common track
                           facilities.

                  d.       Lessor's participation in cost sharing shall be
                           limited to a maximum of $50,000.00 or 50% of the cost
                           of the lead track facilities, whichever is the
                           lesser. Payment to be made after all track and
                           associated facilities are in place and certified by
                           the railroad (CSX) and upon receipt of appropriate
                           invoices.

                  e.       Responsibility for maintenance of the spur track and
                           associated equipment and facilities shall be stated
                           in a separate agreement between the Lessor and
                           Lessee.

                  f.       The extended lead track shall become the property of
                           the Lessor with the Lessor responsible for the
                           maintenance of the track.

         8. Except as herein expressly amended, all other terms and conditions
of the Agreement of Lease, as previously amended, shall remain the same.

         IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their duly authorized officers the day and year first above
written.


Signed, sealed and delivered                TAMPA PORT AUTHORITY
in the presence of:

/s/ MYRNA M. GARNER                         /s/ JOSEPH L. VALENTI       (Seal)
----------------------------------          ----------------------------------
/s/ SUSAN PERDONO                           By: Joseph L. Valenti
----------------------------------          Its: Port Director



                                        4
<PAGE>

Signed, sealed and delivered                BOLIDEN CHEMICALS INC.
in the presence of:

/s/ [ILLEGIBLE]                             /s/ MICHAEL J. AMATO (Seal)
----------------------------------          ----------------------------------
/s/ [ILLEGIBLE]                             By: Michael J. Amato
----------------------------------          Its: Secretary



                                        5
<PAGE>




                                    EXHIBIT A
<PAGE>

                      AMENDMENT NO. 6 TO AGREEMENT OF LEASE

         This Amendment No. 6 to Agreement of Lease made and entered into this
16th day of this 16th day of February, 1989, by and between the TAMPA PORT
AUTHORITY; a body politic and corporate organized and existing under the laws of
the State of Florida, hereinafter referred to as "Lessor", and BOLIDEN CHEMICALS
INC., hereinafter referred to as "Lessee".

                                   WITNESSETH:

         WHEREAS, Port Sutton, Inc. and Eastern Seaboard Petroleum Company
previously entered into an Agreement of Lease dated December 16, 1976 which was
amended by the parties on May 21, 1980, and October 10, 1980; and

         WHEREAS, Eastern Seaboard Petroleum Company assigned its Lease to
Steuart Petroleum Company an August 14, 1984 which Lease was amended by the
parties on August 15, 1984; and

         WHEREAS, Port Sutton assigned the said Lease on September 21, 1984 to
Lessor; and

         WHEREAS, the Lessor and Steuart Petroleum Company amended said
agreement of Lease on July 13, 1987, and December 5, 1988, and

         WHEREAS, Steuart Petroleum Company assigned its Lease to Lessee on
February 16, 1989; and

         WHEREAS, the parties desire to further amend such Agreement of Lease.

         NOW, THEREFORE, the parties hereto, in consideration of the covenants
contained herein and the sum of One Dollar ($1.00) each to the other in hand
paid, hereby covenant and agree as follows:

         1. This Lease, Article 3, is amended to provide that sulfuric acid
products shall be a permitted commodity to be stored and handled on the leased
premises; provided, however, the Lessee shall use its best efforts to insure the
continuation of throughput/storage of bunker fuels on the lease premises in
order to continue that service as a function of the marine terminal located on
the lease premises.

         2. This Lease, Article 3, Paragraph 1 (a)(ii) subparagraphs A and B of
the First Amendment to Agreement of Lease, Article 2 of the Second Amendment to
Agreement of Lease, and Article 3 of the Fifth Amendment to Agreement of Lease,
is amended to provide that the wharfage rate for sulfuric acid products either
inbound or outbound shall be at rates established by Tampa Port Authority Tariff
No. 10 and any revisions thereto, and movement of sulfuric acid products shall
apply toward the minimum wharfage guarantee for movement of petroleum products.



<PAGE>

         3. Except as herein expressly amended, all other terms and conditions
of the Agreement of Lease, as previously amended, shall remain the same.

         IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their duly authorized officers the day and year first above
written.

WITNESSES:                                TAMPA PORT AUTHORITY

/s/ KELLY M JACKSON                       /s/ EMMETT C. LEE, JR.
----------------------------------        ------------------------------------
/s/ SUSAN PERDOMO                         By: Emmett C. Lee, Jr.
----------------------------------        Its: Port Director

WITNESSES:                                BOLIDEN CHEMICALS INC.

/s/ [ILLEGIBLE]                           /s/ MICHAEL J. AMATO
----------------------------------        ------------------------------------
/s/ [ILLEGIBLE]                           By: Michael J. Amato
----------------------------------        Its: Secretary



                                       -2-
<PAGE>

                      AMENDMENT NO. 5 TO AGREEMENT OF LEASE

         This Amendment No. 5 to Agreement of Lease made and entered into this
5th day of December, 1988, by and between the TAMPA PORT AUTHORITY, a body
politic and corporate organized and existing under the laws of the State of
Florida, hereinafter referred to as "Lessor", and STEUART PETROLEUM COMPANY,
hereinafter referred to as "Lessee".

                                   WITNESSETH:

         WHEREAS, Port Sutton, Inc. and Eastern Seaboard Petroleum Company
previously entered into an Agreement of Lease dated December 16, 1976 which was
amended by the parties on May 21, 1980, and October 10, 1980; and

         WHEREAS, Eastern Seaboard Petroleum Company assigned its Lease to
Lessee on August 14, 1984 which Lease was amended by the parties on August 15,
1984; and

         WHEREAS, Port Sutton assigned the said Lease on September 21, 1984 to
Lessor; and

         WHEREAS, the parties amended said Agreement of Lease on July 13, 1987;
and

         WHEREAS, the parties desire to further amend such Agreement of Lease.

         NOW, THEREFORE, the parties hereto, in consideration of the covenants
contained herein and the sum of One Dollar ($1.00) each to the other in hand
paid, hereby covenant and agree as follows:

         1. Term of this Lease shall be extended for one (1) year commencing
December 16, 1988 and ending December 15, 1989.

         2. This Lease, Article 3, Paragraph 1 (a)(i) of the First Amendment to
Agreement of Lease, is amended to provide that the bare land rental rate shall
be increased to $64,140.00 annually, to be paid monthly in advance at a rate of
$5,345.00.

         3. This Lease, Article 3, Paragraph 1 (a)(ii) subparagraphs A and B of
the First Amendment to Agreement of Lease and Article 2 of the Second Amendment
to Agreement of Lease, is amended to provide that the wharfage guarantee on
inbound movements of petroleum products shall be increased to $64,140.00
annually, and the wharfage guarantee on outbound movements of petroleum products
shall be increased to $14,153.00 annually.



APPROVED AS TO FORM AND LEGALITY,

/s/ CAROLE A TAYLOR
-------------------
LEGAL DEPARTMENT



<PAGE>

         4. This Lease, Article 3, Paragraph 2 (b) of the First Amendment of
Lease and Article 3 of the Second Amendment to Agreement, is amended to provide
that the minimum charge relative to the Vessel Mooring System shall be increased
to $24,984.00 annually, to be paid monthly in advance at a rate of $2,982.00.

         5. Paragraph 23 of the Agreement of Lease as deleted and replaced by
Article 5 of the First Amendment to Agreement of Lease is hereby amended in its
entirety to read as follows:

         23. Lessee shall have two successive options to renew and extend this
         Lease, as amended. The first renewal shall be for a period of seven (7)
         years beginning December 16, 1989, and the second renewal shall be for
         a period of ten (10) years beginning December 16, 1996. Each such
         option shall be exercised by Lessee by giving written notice to the
         Lessor no less than ninety (90) days prior to the expiration of the
         term then in effect. If Lessee does not exercise the seven (7) year
         option to renew, Lessee shall pay to the Lessor an amount of
         $167,417.00 as an option fee within 30 days of expiration of the term
         as herein extended. If Lessee does exercise the seven (7) year option
         period, the rental rate, the inbound and outbound wharfage guarantees
         and the minimum charge relative to the Vessel Mooring System shall be
         increased effective upon commencement of said seven (7) year option
         period (and, if exercised, increased again effective at the
         commencement of the successive ten (10) year option period) to an
         amount calculated by multiplying the base amount of the charge (as
         stated in this Amendment) for which the adjustment is being calculated
         by a fraction whose numerator is The Consumer Price Index, U.S. City
         Average All Items (Base Year 1967) published by the Bureau of Labor
         Statistics, U.S. Department of Labor, for the third month prior to the
         expiration of the term then in effect, and whose denominator shall be
         said Consumer Price Index, U.S. City Average All Items for the third
         month prior to the commencement of this Amendment.



                                       -2-
<PAGE>

         Should the Bureau of Labor Statistics change the manner of computing
         the Consumer Price Index, the Bureau shall be requested to furnish a
         conversion factor designated to adjust the new index to the one
         previously in use, and adjustment to the new index will be made on the
         basis of such conversion factor. Should the publication of the Consumer
         Price Index be discontinued by the Bureau of Labor Statistics, then
         such other index as may be published by said Bureau most nearly
         approaching said discontinued index shall be used in making the
         adjustment herein provided. No additional option fee shall be payable
         by Lessee with respect to the successive ten (10) year option period.

         6. Except as herein expressly amended, all other terms and conditions
of the Agreement of Lease, as previously amended, shall remain the same.

         IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their duly authorized officers the day and year first above
written.

Signed, sealed and delivered                TAMPA PORT AUTHORITY
in the presence of:

/s/ KELLY M. JACKSON                        /s/ EMMETT C. LEE, JR.      [Seal]
----------------------------------          ----------------------------
/s/ SUSAN PERDOMO                           By: Emmett C. Lee, Jr.
----------------------------------          Its: Port Director

Signed, sealed and delivered                STEUART PETROLEUM COMPANY
in the presence of:

/s/ CAROLYN GIVENS                          /s/ JOHN W. CONNOLLY, JR.   [Seal]
----------------------------------          ----------------------------
/s/ KEVIN R. PURCELL                        By: John W. Connolly, Jr.
----------------------------------          Its: Senior Vice President



                                       -3-
<PAGE>

                      AMENDMENT NO. 5 TO AGREEMENT OF LEASE

         This Amendment No. 5 to Agreement of Lease made and entered into this
5th day of December, 1988, by and between the TAMPA PORT AUTHORITY, a body
politic and corporate organized and existing under the laws of the State of
Florida, hereinafter referred to as "Lessor", and STEUART PETROLEUM COMPANY,
hereinafter referred to as "Lessee".

                                   WITNESSETH:

         WHEREAS, Port Sutton, Inc. and Eastern Seaboard Petroleum Company
previously entered into an Agreement of Lease dated December 16, 1976 which was
amended by the parties on May 21, 1980, and October 10, 1980; and

         WHEREAS, Eastern Seaboard Petroleum Company assigned its Lease to
Lessee on August 14, 1984 which Lease was amended by the parties on August 15,
1984; and

         WHEREAS, Port Sutton assigned the said Lease on September 21, 1984 to
Lessor; and

         WHEREAS, the parties amended said Agreement of Lease on July 13, 1987;
and

         WHEREAS, the parties desire to further amend such Agreement of Lease.

         NOW, THEREFORE, the parties hereto, in consideration of the covenants
contained herein and the sum of One Dollar ($1.00) each to the other in hand
paid, hereby covenant and agree as follows:

         1. Term of this Lease shall be extended for one (1) year commencing
December 16, 1988 and ending December 15, 1989.

         2. This Lease, Article 3, Paragraph 1 (a)(1) of the First Amendment to
Agreement of Lease, is amended to provide that the bare land rental rate shall
be increased to $64,140.00 annually, to be paid monthly in advance at a rate of
$5,345.00.

         3. This Lease, Article 3, Paragraph 1 (a)(ii) subparagraphs A and B of
the First Amendment to Agreement of Lease and Article 2 of the Second Amendment
to Agreement of Lease, is amended to provide that the wharfage guarantee on
inbound movements of petroleum products shall be increased to $64,140.00
annually, and the wharfage guarantee on outbound movements of petroleum products
shall be increased to $14,153.00 annually.



APPROVED AS TO FORM AND LEGALITY.

/s/ CAROLE A. TAYLOR
--------------------
LEGAL DEPARTMENT



<PAGE>

         4. This Lease, Article 3, Paragraph 2 (b) of the First Amendment of
Lease and Article 3 of the Second Amendment to Agreement, is amended to provide
that the minimum charge relative to the Vessel Mooring System shall be increased
to $24,984.00 annually, to be paid monthly in advance at a rate of $2,982.00.

         5. Paragraph 23 of the Agreement of Lease as deleted and replaced by
Article 5 of the First Amendment to Agreement of Lease is hereby amended in its
entirety to read as follows:

         23. Lessee shall have two successive options to renew and extend this
         Lease, as amended. The first renewal shall be for a period of seven (7)
         years beginning December 16, 1989, and the second renewal shall be for
         a period of ten (10) years beginning December 16, 1996. Each such
         option shall be exercised by Lessee by giving written notice to the
         Lessor no less than ninety (90) days prior to the expiration of the
         term then in effect. If Lessee does not exercise the seven (7) year
         option to renew, Lessee shall pay to the Lessor an amount of
         $167,417.00 as an option fee within 30 days of expiration of the term
         as herein extended. If Lessee does exercise the seven (7) year option
         period, the rental rate, the inbound and outbound wharfage guarantees
         and the minimum charge relative to the Vessel Mooring System shall be
         increased effective upon commencement of said seven (7) year option
         period (and, if exercised, increased again effective at the
         commencement of the successive ten (10) year option period) to an
         amount calculated by multiplying the base amount of the charge (as
         stated in this Amendment) for which the adjustment is being calculated
         by a fraction whose numerator is The Consumer Price Index, U.S. City
         Average All Items (Base Year 1967) published by the Bureau of Labor
         Statistics, U.S. Department of Labor, for the third month prior to the
         expiration of the term then in effect, and whose denominator shall be
         said Consumer Price Index, U.S. City Average All Items for the third
         month prior to the commencement of this Amendment.
<PAGE>

         Should the Bureau of Labor Statistics change the manner of computing
         the Consumer Price Index, the Bureau shall be requested to furnish a
         conversion factor designated to adjust the new index to the one
         previously in use, and adjustment to the new index will be made on the
         basis of such conversion factor. Should the publication of the Consumer
         Price Index be discontinued by the Bureau of Labor Statistics, then
         such other index as may be published by said Bureau most nearly
         approaching said discontinued index shall be used in making the
         adjustment herein provided. No additional option fee shall be payable
         by Lessee with respect to the successive ten (10) year option period.

         6. Except as herein expressly amended, all other terms and conditions
of the Agreement of Lease, as previously amended, shall remain the same.

         IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their duly authorized officers the day and year first above
written.

Signed, sealed and delivered                TAMPA PORT AUTHORITY
in the presence of:

/s/ KELLY M. JACKSON                        /s/ EMMETT C. LEE, JR.        [Seal]
----------------------------------          ------------------------------
/s/ SUSAN PERDOMO                           By: Emmett C. Lee, Jr.
----------------------------------          Its: Port Director

Signed, sealed and delivered                STEUART PETROLEUM COMPANY
in the presence of:

/s/ CAROLYN GIVENS                          /s/ JOHN W. CONNOLLY, JR.     [Seal]
----------------------------------          ------------------------------
/s/ KEVIN R. PURCELL                        By: John W. Connolly, Jr.
----------------------------------          Its: Senior Vice President



                                       -3-
<PAGE>

                              SETTLEMENT AGREEMENT

         This Settlement Agreement dated this 31st day of August, 1988 by and
between the Tampa Port Authority, a body corporate and politic organized and
existing under the laws of the State of Florida (hereinafter "Authority"), party
of the first part, and Steuart Petroleum Company, a Delaware Corporation
(hereinafter "Steuart"), party of the second part (hereinafter "Tenant").

                                    WITNESSES

         WHEREAS, on December 16, 1976, Port Sutton, Inc. and Eastern Seaboard
Petroleum Company (hereinafter "Eastern") entered into a lease of certain
property in Hillsborough County, Florida, located on that peninsula commonly
known as "Pendola Point";

         WHEREAS, by agreement dated August 14, 1984, Eastern assigned its
interest in the lease to Steuart Petroleum Company (hereinafter "Steuart")

         WHEREAS, on November 14, 1985 Port Sutton, Inc. conveyed the lease
premises to and assigned its interest in said lease to the Authority;

         WHEREAS, the lease premises are currently operated by Steuart through
its Western Fuels Division;

         WHEREAS, on March 7, 1987 the bulkhead adjacent to the lease premises
partially collapsed causing damage to some of Tenant's equipment on the lease
premises;

         WHEREAS, a dispute arose between Authority and Tenant regarding each
parties responsibilities for repair and payment of rent under the lease
agreement;

         WHEREAS, the parties now desire to settle the dispute between them;

         NOW, THEREFORE, the parties hereto agree as follows:

         1. That Authority on June 18, 1987 completed repairs to the structure
supporting the pipeline and stabilizing the bulkhead at the lease premises to
the reasonable satisfaction of Tenant.

         2. That the pipeline itself is now in working order and operational.

         3. That Authority agrees to reduce its invoiced amount for the period
March 7, 1987 through June 19, 1987 ($5,790.96) by one-half, thereby making the
amount due and payable to Authority for that period two thousand eight-hundred
ninety five and 48/100 dollars ($2,895.48).



<PAGE>

                                       -2-


         4. That Tenant shall pay to the Authority the sums described in
paragraph 3, within ten (10) days after full execution hereof by certified check
payable to the Authority.

         5. Within ten (10) days after full execution hereof and simultaneously
with the delivery of the certified check described in paragraph 4, the parties
hereto shall exchange fully executed releases in the forms attached hereto as
Exhibits A and B.

         6. That any charges accruing thereafter are not governed by this
settlement agreement but shall be invoiced and paid in accordance with the lease
agreement, as amended, between the parties.

         IN WITNESS WHEREOF the parties hereto have set their hands and seals on
the dates stated below.

WITNESSES:                             TAMPA PORT AUTHORITY

/s/ KELLY JACKSON                      By: /s/ EMMETT C. LEE, JR.
----------------------------------        --------------------------------------
/s/ SUSAN PERDOMO                         Its: Emmett C. Lee, Jr., Port Director
----------------------------------        Date: 31 August 1988

                                       STEUART PETROLEUM COMPANY

/s/ [ILLEGIBLE]                        By: /s/ JOHN W. CONNOLLY, JR.
----------------------------------        --------------------------------------
/s/ [ILLEGIBLE]                           Its: Senior Vice President
----------------------------------        Date: August 26, 1988


Exhibit A - Full and Complete Release (Steuart)

Exhibit B - Full and Complete Release (Authority)
<PAGE>

                            FULL AND COMPLETE RELEASE

         KNOW ALL MEN BY THESE PRESENTS, That STEUART PETROLEUM COMPANY, in
consideration of the sum of Ten Dollars, acknowledged by all parties as paid and
other good and valuable consideration, the receipt of all of which is hereby
acknowledged by the undersigned, which is acknowledged to be in full and final
payment of all sums, obligations or claims due or made by it against TAMPA PORT
AUTHORITY, and its successors, assigns, officers, directors, attorneys, agents,
servants, trustees and employees, does by these presents forever release, acquit
and discharge the said TAMPA PORT AUTHORITY, its successors, assigns, officers,
directors, agents, servants, employees, attorneys and trustees, of and from any
and all, known and unknown, claims, debts, demands, causes of action and
liabilities of every kind, character and nature whatsoever arising out of the
failure on March 7, 1987 of the bulkhead at Tampa Port Authority Berth 25,
located on Port Sutton Channel, Hillsborough County, Florida whether they be for
negligence or based on the lease agreement between the parties, from the
beginning of time to date.

         IN WITNESS WHEREOF, the undersigned has set its hand and seal this 26th
day of August, 1988.

Signed, sealed and delivered                     STEUART PETROLEUM, COMPANY
in the presence of:

/s/ THEO V. VILLINGHUNT                          By: /s/ JOHN W. CONNOLLY JR.
-----------------------------                        --------------------------
                                                     Its: Senior Vice President
by Carolyn Givens                                    (CORPORATE SEAL)
-----------------------------

                                                 THIS IS A LEGAL RELEASE OF
                                                 LIABILITY -- READ IT CAREFULLY
                                                 BEFORE SIGNING.

<PAGE>




                            FULL AND COMPLETE RELEASE

         KNOW ALL MEN BY THESE PRESENTS, That TAMPA PORT AUTHORITY (hereinafter
"AUTHORITY"), in consideration of the sum of Ten Dollars, acknowledged by
AUTHORITY as paid, and other good and valuable consideration, the receipt of all
of which is hereby acknowledged by the undersigned, which is acknowledged to be
in full and final payment of all sums, obligations or claims due or made by it
against STEUART PETROLEUM COMPANY ("STEUART"), and its successors, assigns,
officers, directors, attorneys agents, servants, trustees and employees, does by
these presents forever release, acquit and discharge the said STEUART, its
successors, assigns, officers, directors, agents, servants, employees, attorneys
and trustees of and from any and all, known and unknown, claims, debts, demands,
causes of actions and liabilities, of every kind, character and nature
whatsoever arising out of the failure on March 7, 1987 of the bulkhead at Tampa
Port Authority Berth 25 located on Port Sutton Channel, Hillsborough County,
Florida, whether they be for negligence or based on the lease agreement between
the parties, from the beginning of time to date.

         IN WITNESS WHEREOF, the undersigned has set its hand and seal this 31st
day of August, 1988.


Signed, sealed and delivered              TAMPA PORT AUTHORITY
in the presence of:

/s/ KELLY M. JACKSON                      /s/ EMMETT C. LEE, JR.
--------------------------------         --------------------------------------
/s/ SUSAN PERDOMO                        Its: Emmett C. Lee, Jr., Port Director
--------------------------------             (CORPORATE SEAL)

                                         THIS IS A LEGAL RELEASE OF
                                         LIABILITY -- READ IT CAREFULLY
                                         BEFORE SIGNING



<PAGE>


                      AMENDMENT NO. 4 TO AGREEMENT OF LEASE

         This Amendment No. 4 to Agreement of Lease made and entered into this
13th day of July, 1987, by and between the TAMPA PORT AUTHORITY, a body politic
and corporate organized and existing under the laws of the State of Florida,
hereinafter to as "Lessor" and Steuart Petroleum Company, hereinafter referred
to as "Lessee".

                                   WITNESSETH:

         WHEREAS, Port Sutton, Inc. and Eastern Seaboard Petroleum Company
previously entered into an Agreement of Lease dated December 16, 1976 which was
amended by the parties on May 21, 1980, and October 10, 1980 and;

         WHEREAS, Eastern Seaboard Petroleum Company assigned its Lease to
Lessee on August 14, 1984 which Lease was amended by the parties on August 15.
1984; and

         WHEREAS, Port Sutton assigned the said Lease on September 21, 1984 to
Lessor; and

         WHEREAS, the parties desire to amend such Agreement of Lease.

         NOW, THEREFORE, the parties hereto, in consideration of the covenants
contained herein and the sum of One Dollar ($1.00) each to the other in hand
paid, hereby covenant and agree as follows:

         1. Term of this Lease shall be extended for Two (2) years commencing
December 16, 1986 and ending December 15, 1988.

         2. This Lease, Article 3, Paragraph 1 (a)(i) of the first Amendment to
Agreement of Lease, is amended to provide that the bare land rental rate shall
be increased to $59,676.00 annually, to be paid monthly in advance at a rate of
$4,973.00.

         3. This Lease, Article 3, Paragraph 1 (a)(ii) subparagraphs A and B of
the First Amendment to Agreement of Lease and Article 2 of the Second Amendment
to Agreement of Lease, is amended to the extent that wharfage rate for petroleum
products either inbound or outbound shall be per the rates established in the
Tampa Port Authority Tariff No. 9 and any revisions thereto. Wharfage guarantee
on inbound movements of petroleum products shall be increased to $59,676.00
annually, and the wharfage guarantee on outbound movements of petroleum products
shall be increased to $13,168.40 annually.




<PAGE>

Page two


         4. Paragraph 23 of the Agreement of Lease as deleted and replaced by
Article 5 of the First Amendment to Agreement of Lease is hereby amended in its
entirety to read as follows:

         23. Lessee shall have two successive options of renewing and extending
         this Lease, as amended. One such renewal and extension being a period
         of eight (8) years beginning December 16, 1988 and one further renewal
         extending this Lease for a period of ten (10) years beginning December
         16, 1996. Each such option shall be exercised by giving written notice
         to the Lessor no less than ninety (90) days prior to the expiration of
         the term then in effect. If Lessee does not exercise the eight (8) year
         option to renew, Lessee shall pay to the Lessor an amount of
         $155,770.40 as an option fee within 30 days of expiration of the term
         as herein extended. If Lessee does exercise the eight (8) year option
         period, the rental rate, the inbound and outbound wharfage guarantees
         and the minimum charge relative to the Vessel Mooring System set forth
         in Article 3, paragraph 2(b) of the Fist Amendment of Lease and as
         amended by Article 3 of the Second Amendment to Agreement shall be
         increased effective upon commencement of said eight (8) year option
         period (and, if exercised, increased again effective at the
         commencement of the successive ten (10) year option period) to an
         amount calculated by multiplying the base amount of the charge (as
         stated in this amendment) for which the adjustment is being calculated
         by a fraction whose numerator is The Consumer Price Index, U.S. City
         Average All Items (Base Year 1967) published by the Bureau of Labor
         Statistics, U.S. Department of Labor, for the third month prior to
         expiration of the term then in effect, and whose denominator shall be
         said Consumer Price Index U.S. City Average All Items for the third
         month prior to the commencement of this Amendment. Should the Bureau of
         Labor Statistics change the manner of computing the Consumer Price
         Index, the Bureau shall be requested to


<PAGE>




Page three

         furnish a conversion factor designated to adjust the new index to the
         one previously in use, and adjustment to the new index will be made on
         the basis of such conversion factor. Should the publication of the
         Consumer Price Index be discontinued by the Bureau of Labor Statistics,
         then such other index as may be published by said Bureau most nearly
         approaching said discontinued index shall be used in making the
         adjustment herein provided. No additional option fee shall be payable
         by Lessee with respect to the successive ten (10) year option period.

5.       Paragraph 10 of the Agreement of Lease is hereby amended in its
         entirety to read as follows: It is covenanted and agreed that Lessor by
         and through its duly authorized officers, agents and representatives
         shall have the right at any and all times to go upon and inspect the
         demised premises. If at any time during the term of this Lease, Lessor
         has reasonable grounds to suspect that there has been - unauthorized
         or prohibited disposal of "hazardous waste" as defined below, Lessor
         shall also have the right to perform appropriate tests on the demised
         premises at its own cost and expense.

6.       Paragraph 11 of the Agreement of Lease is hereby amended in its
         entirety to read as follows:
         Lessee covenants and agrees that Lessee will comply with all the valid
         requirements of law and duly constituted public authority and
         environmental protection laws so far as they concern Lessee's occupancy
         of demised premises, and it will not use the demised premises or any
         part hereof in such manner as to create a nuisance, undue noise,
         noxious odors or unwarranted interference with the enjoyment of
         adjoining premises by the Owners and tenants thereof other than what is
         normal for an operating petroleum storage terminal nor use the same for
         any unlawful purposes or in violation of any State Statute, City
         Ordinance or Rule or Regulation promulgated by or under such authority;
         and that at all times Lessee will keep said demised premises in a clean
         and sanitary condition and not allow waste or refuse to accumulate or
         be stored


<PAGE>




Page four

         on the demised premises and shall not dump or place any waste or refuse
         in any water, either navigable or non-navigable in or adjacent to the
         terminal area.
         Any "disposal" of a "hazardous substance" as defined in and prohibited
         by 42USC9601, the "Comprehensive Environmental Response, Compensation
         and Liability Act of 1980", of a "hazardous waste" as defined in and
         prohibited by 42USC6901, the "Resource Conservation and Recovery Act of
         1976" or of a "hazardous waste" as defined in and prohibited by Section
         403.703, Florida Statutes (1985), as same may be modified or revised,
         on any property of the Tampa Port Authority or in any manner
         deleteriously affecting property of the Tampa Port Authority is
         expressly prohibited. Any unauthorized discharge prohibited on the
         Lease Premises under Lessee's exclusive possession and control by
         anyone or any unauthorized or prohibited discharge upon any
         non-exclusive easements which are a part of the lease premises by
         Lessee of such "hazardous substance" or "hazardous waste" shall be
         promptly cleaned up and environmentally restored by Lessee in
         accordance with proper procedures and applicable governmental
         regulations. Any violation of this provision which is not remedied by
         Lessee or with respect to which curative actions are not commenced by
         Lessee as required by the governmental entity requesting same (after
         Lessee has exercised or invoked all available review and /or appeals of
         such requirements) shall be considered a default hereunder, and Lessor,
         at its option, may declare this lease terminated upon expiration of the
         longer of any curative period permitted by the governmental entity or
         by Lessor. In addition, Lessee agrees that within forty-five (45) days
         of termination of this Lease for any reason, Lessee shall have
         performed a site investigation


<PAGE>






Page five

         by an independent environmental consultant, who has been approved in
         advance by Lessor, such approval shall not be unreasonably withheld.
         The scope of such site investigation shall be as recommended by the
         consultant and approved by the parties hereto. The results of such site
         investigation shall be in writing and shall be delivered to Lessor
         within five (5) days of receipt from the independent environmental
         consultant. If the results of this site investigation do not reveal the
         presence of prohibited disposal of "hazardous waste" on the Premises,
         Lessee shall bear the cost of such site investigation not to exceed
         $7,500.00 and Lessor shall bear any cost of the same in excess of
         $7,500.00; said $7,500.00 is stated in 1986 dollars and shall be
         adjusted by the CPI Index in the manner provided in paragraph 4 hereof
         at the time any such sums become due. In addition, any further site
         investigation may be conducted by the Lessor at its cost and expense.
         If any site investigation reveals the presence of "hazardous waste"
         which has been disposed of on the premises without proper
         authorization or Lessee otherwise violates this provision, Lessee shall
         bear the entire cost of such site investigation and Lessor may bring an
         action for injunctive relief against Lessee and/or bring any action
         against Lessee to recover any damages, including but not limited to
         costs of investigation, removal, recovery and clean-up costs and fines
         incurred by Lessor due to Lessee's violation of this provision.

         7. Except as herein expressly amended, all other terms and conditions
of the Agreement of Lease, as previously amended, shall remain the same.

         IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their duly authorized officers the day and year first


<PAGE>

Page six


above written.


Signed, sealed and delivered                            TAMPA PORT AUTHORITY
in the presence of.

/s/ KELLY M. JACKSON                           By: /s/ EMMETT C. LEE, JR.
-------------------------------                    ----------------------------
/s/ [ILLEGIBLE]                                    Emmett C. Lee, Jr.
-------------------------------                    Its: Port Director



Signed sealed and delivered
in the presence of:

/s/ [ILLEGIBLE]                                 By: /s/ JOHN W. CONNOLLY, JR.
-------------------------------                     ---------------------------
/s/ KEVIN R. PURCELL                                Its: Sr. Vice President
-------------------------------


<PAGE>









           THIRD AMENDMENT TO BE ATTACHED TO AGREEMENT OF LEASE DATED
            DECEMBER 16, 1976, BETWEEN PORT SUTTON, INC. AND EASTERN
            SEABOARD PETROLEUM COMPANY, INC. FOR PREMISES LOCATED IN
                    PORT SUTTON. HILLSBOROUGH COUNTY, FLORIDA


         This Third Amendment to Lease of December 16, 1976, by and between PORT
SUTTON, INC., a Florida corporation, (hereinafter called "Lessor") and STEUART
PETROLEUM COMPANY, a Delaware corporation, (hereinafter called "Lessee").

                                   WITNESSETH:

         WHEREAS, Lessor and EASTERN SEABOARD PETROLEUM COMPANY previously
entered into an Agreement of Lease (the "Agreement of Lease") dated December 16,
1976 covering certain real property situated at Port Sutton, southeast of the
city of Tampa, in Hillsborough County, Florida, together with nonexclusive
easements, as described in said Agreement of Lease; and

         WHEREAS, Lessor and EASTERN SEABOARD PETROLEUM COMPANY amended the
Agreement of Lease by First Amendment to Agreement of Lease dated May 21, 1980,
and further amended the Agreement of Lease by a Second Amendment to Lease dated
October 10, 1980; and

         WHEREAS, EASTERN SEABOARD PETROLEUM COMPANY, entered into Lease
Assignment and Agreement effective August 14, 1984 in which it assigned all of
its interest in the Agreement of Lease to Lessee; and

         WHEREAS, Lessor and Lessee desire to add additional acres to the leased
real property;

         NOW, THEREFORE, for and in consideration of the sum of One Dollar
($1.00) each to the other in hand paid, receipt of which is hereby acknowledged,
and other valuable consideration, Lessor and Lessee stipulate and bind
themselves and agree as follows:

         1. The Lessor does hereby lease unto the Lessee an additional 0.334
acres which is more particularly described in Exhibit A attached hereto and
incorporated herein by reference.


<PAGE>

         2. The monthly land rent and wharfage for this increased area described
in Exhibit A shall be at the same rate as the rate stated in the Agreement of
Lease.

         3. In all other respects, the Agreement of Lease, as amended by the
First Amendment to Agreement of Lease dated May 21, 1980, and further amended by
the Second Amendment to Lease dated October 10, 1980, between Lessor and Lessee
is hereby confirmed and ratified.

         IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective the 15th day of August, 1984.


Witnesses:                                     "LESSOR"

/s/ JO SHAPIRO                                 PORT SUTTON, INC.
----------------------------
                                               By: /s/ ROBERT THOMAS
/s/ TULULAH G. THOMAS                              ----------------------------
----------------------------                       Its President
                                                       ------------------------

                                                   ATTEST:

                                                   By: /s/ DOROTHY BUGLY
                                                       ------------------------
                                                       Its Assistant Secretary


Witnesses:                                     "LESSEE"

/s/ [ILLEGIBLE]                                STEUART PETROLEUM COMPANY
----------------------------
/s/ BEVERLY K. MINNI                           By: /s/ [ILLEGIBLE]
----------------------------                       ----------------------------
                                                   Its President

                                               ATTEST:

                                               By: /s/ GEORGE C. [ILLEGIBLE]
                                                   ----------------------------
                                                   Its Secretary
                                                       ------------------------
STATE OF Florida
COUNTY OF Hillsborough


         The foregoing instrument was acknowledged before me this 28th day of
August, 1984, by 1984, by Robert Thomas, President of PORT SUTTON, INC., a
Florida corporation,



<PAGE>


on behalf of the corporation.

                                                 /s/ [ILLEGIBLE]
                                                 ---------------------
                                                 NOTARY PUBLIC


                                                 My Commission Expires:

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


STATE OF WASHINGTON
         ----------

COUNTY OF D.C
          ---------

         The foregoing instrument was acknowledged before me this 5th day of
Sept., 1984, by Leonard C. Stuart II;, George C. Sinclair, of STEUART PETROLEUM
COMPANY, a Delaware corporation, on behalf of the corporation


                                                 /s/ WILDA [ILLEGIBLE]
                                                 ---------------------
                                                 NOTARY PUBLIC



                                                 My Commission Expires:

                                                 /s/ August 31, 1985

<PAGE>

Exhibit A to Third Amendment to Lease Agreement dated August 15, 1984 between
Port Sutton, Inc. and Eastern Seaboard Petroleum Company, Inc.

         Beginning at the NE corner of Section 4, Township 30 South, Range 19
         East, Hillsborough County, Florida, run South 2,020.00 feet parallel to
         the East Boundary of said Section 4; thence run West 4,810.00 feet
         parallel to the North Boundary of said Section 4 to the Point of
         Beginning of the tract hereinbelow described: Thence continue West
         parallel to the North Boundary of said Section 4 a distance of 20.00
         feet; thence run South parallel to the East Boundary of said Section 4
         a distance of 729.81 feet; thence run N. 76 degrees 12' 10" E a
         distance of 20.59 feet; thence run North parallel to the East Boundary
         of said Section 4 a distance of 724.90 feet to the Point of Beginning.
         An area containing 0.334 +/- acres.



                             [PROPERTY BOUNDARIES]

<PAGE>
                         LEASE ASSIGNMENT AND AGREEMENT

         AGREEMENT, made as of August 14, 1984, by and between EASTERN SEABOARD
PETROLEUM COMPANY, INC., a Florida corporation, with a mailing address of 2000
Ashland Drive, Ashland, Kentucky 41114, Attention: Vice President ("Assignor"),
and STEUART PETROLEUM COMPANY, a Delaware corporation, with a mailing address of
4646 40th Street, N.W., Washington, D.C. 20016, Attention: President
("Assignee").

                                   WITNESSETH:

         WHEREAS, pursuant to a lease dated December 16, 1976, a true copy of
which is attached hereto as Exhibit A and made a part hereof, Amendment Number 1
to said Lease dated May 21, 1980, a true copy of which is attached hereto as
Exhibit B and made a part hereof and Amendment Number 2 to said Lease dated
October 10, 1980, a true copy of which is attached hereto as Exhibit C and made
a part hereof (all hereinafter referred to as the "Lease"), Port Sutton, Inc.,
with a mailing address of P.O. Box E, Tampa, Florida 33675 ("Lessor"), leased to
Eastern Seaboard Petroleum Company, Inc., a Florida corporation, certain
property located at Port Sutton, Hillsborough County, Florida and more
particularly described in the Lease (the "Leased Premises").

         NOW, THEREFORE, in consideration of Ten Dollars ($10.00) and other
valuable consideration, the receipt and adequacy of which is hereby
acknowledged, Assignor hereby grants, bargains, sells, assigns and confirms to
Assignee, its successors and assigns, all right, title and interest of Assignor
in and to the Lease, on the terms and conditions set forth below.

         1. Representations of Assignor. Assignor hereby represents and warrants
to Assignee that; (i) the Lease documents at Exhibits A, B and C constitute the
entire Agreement between Lessor and Assignor and there have



<PAGE>




been no modifications to the said documents; (ii) that as of the date hereof,
the Lease is in full force and effect, has not been materially breached by
Assignor (or, if materially breached, that such breach has been effectively
cured), is enforceable in accordance with its terms and conditions, and Assignor
is not aware of any condition which upon mere delivery of notice and or passage
of time would result in a default thereunder; (iii) Assignor has full and lawful
authority to assign the Lease subject to the consent of Lessor; and (iv)
Assignor will save harmless and indemnify Assignee, its officers and directors,
from any and all claims resulting from Assignor's conduct of business in
connection therewith.

         2. Covenants of Assignee. From and after the date hereof, Assignee
hereby assumes all right, title and interest of Assignor in and to the Lease,
agrees to be bound by all terms and conditions thereof, and agrees to protect,
defend and indemnify and save harmless Assignor and its subsidiaries and related
companies and the directors, officers, employees, workmen and agents of Assignor
and its subsidiaries and related companies, from and against any loss, cost,
damage, demand, claim or other liability, including attorneys fees and other
expenses of litigation, which directly or indirectly results from or arises out
of Assignee's performance or nonperformance under the Lease, or which directly
or indirectly results from or arises out of Assignee's ownership, use or
possession of the Leased Premises or the improvements thereon. Not more than
fifteen (15) days after the date hereof, Assignee shall obtain and furnish to
the Lessor (with a copy furnished to Assignee) a certificate evidencing that
Assignee has obtained the insurance coverages requested by the Lease.

         3. Taxes and Recording Costs. Assignee shall be fully liable for and
pay: (i) any sales or excise tax which is due with respect to the transfer of



                                       -2-


<PAGE>




the Lease; and (ii) the cost for the recording of this Assignment or any other
instrument relating to the Lease.

         4. Rentals/Real Estate Taxes/Assessments/Utilities. The monthly rental;
and any real estate taxes or assessments on the Leased Premises due and payable
by Assignor during the year of the Closing shall be prorated between Assignor
and Assignee as of the Closing Date on the basis of the most recently available
bills with a post-Closing adjustment within seven (7) days after receipt of the
actual current tax bills. From and after the Closing Date, Assignee shall be
fully liable for and pay all rentals, taxes, utility charges and other expenses
relating to the Leased Premises, in accordance with the provisions of the Lease.

         5. Miscellaneous Provisions.

                  (a) This Agreement shall be construed, governed and
administered in accordance with the laws of the State of Florida.

                  (b) This Agreement is the final and entire expression of the
agreement between Assignor and Assignee with respect to its subject matter.

                  (c) Nothing in this Agreement, express or implied, is intended
to confer on any person other than Assignor and Assignee, and their respective
successors and assigns, any right or remedy under or by reason of this
Agreement.

                  (d) This Agreement is binding upon and shall inure to the
benefit of Assignor and Assignee and their respective heirs, successors and
assigns. In no event shall assignment of this Agreement by Assignee relieve such
party of its liabilities and obligations as primary obligor under this Agreement
without the prior written consent of the Assignor.

                  (e) This Agreement will not be binding upon Assignor or
Assignee until it is fully executed by and delivered to both parties. This
Agreement




                                       -3-


<PAGE>






may not be amended, modified or supplemented, except by written agreement of
Assignor and Assignee, executed by their duly authorized representatives.

                  (f) Any notice or other communication required or permitted by
this Agreement shall not be valid unless in writing and personally delivered or
sent by postage prepaid registered or certified United States Mail, with return
receipt requested, addressed to the party for whom such notice is intended at
the address given for such party in the heading of this Agreement. Notice shall
be deemed given upon actual physical receipt by the party to whom the notice is
addressed. Either ASSIGNOR or ASSIGNEE may change the address provided for it by
notice given to the other party in accordance with this Section 5(f).

                  (g) No waiver of any breach of this Agreement may be construed
as a waiver of any continuing or subsequent breach of the same or any other
provision hereof.

       IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written, by order of their respective Boards of
Directors.

Signed, Sealed and Delivered
In The Presence Of:

WITNESSES:                                  EASTERN SEABOARD PETROLEUM
                                              COMPANY, INC.

/s/ [ILLEGIBLE]                             By: /s/ [ILLEGIBLE]
-----------------------                         --------------------------------
/s/ SHERRY ADAMS                            Its: Vice President
-----------------------
                                            ATTEST:


                                            By: /s/ MICHAEL F. JORDAN
                                                --------------------------------
                                                Assistant Secretary [SEAL]



                                      -4-
<PAGE>
Signed, Sealed and Delivered
In The Presence Of:

WITNESSES:                                     STEUART PETROLEUM COMPANY

/s/ [ILLEGIBLE]                                By: /s/ [ILLEGIBLE]
-----------------------------                      ----------------------------

/s/ [ILLEGIBLE]                                Its: President
-----------------------------
                                               ATTEST:

                                               By: /s/ GEORGE C. [ILLEGIBLE]
                                                   -------------------------
                                                   Secretary [SEAL]

Signed, Sealed and Delivered
In The Presence of:

WITNESSES:                                     Agreed and accepted this 20th
                                               day of July, 1984.

/s/ [ILLEGIBLE]                                PORT SUTTON, INC.
----------------------------------
/s/ TULULAH G. THOMAS                          By: /s/ [ILLEGIBLE]
----------------------------------                 ----------------------------
                                               Its: President
                                                    ---------------------------

                                               ATTEST: /s/ DOROTHY C. BERGER
                                                       ------------------------
                                                       Asst Secretary [SEAL]


STATE OF Kentucky     )
                      ) SS:
COUNTY OF [ILLEGIBLE] )

         On the 10th day of July, 1984, before me personally came James E. Stout
and Michael F. Jordan to me known, who, being by me duly sworn, did depose and
say that they are the Vice President and Asst Secretary, respectively, of
EASTERN SEABOARD PETROLEUM COMPANY, INC., the corporation described in and which
executed the above instrument; that they know the seal of said corporation; that
the seal affixed to said instrument is such corporate seal; that it was so
affixed by order of the Board of Directors of said corporation; and that they
signed their names thereto by like order.

                                                      /s/ DEBRA J. DOHERTY
                                                      --------------------------
                                                      Notary Public


                       My commission expires May 12, 1986


                                      -5-
<PAGE>




STATE OF WASHINGTON, D.C.)
                         ) SS.
COUNTY OF  D.C.          )

         On the 5th day of July, 1984, before me personally came George C.
Sinclair and Leonard C. Steuart, II to me known, who, being by me duly sworn,
did depose and say that they are the President and Secretary, respectively, of
STEUART PETROLEUM COMPANY, the corporation described in and which executed the
above instrument; that they know the seal of said corporation; that the seal
affixed to said instrument is such corporate seal; that it was so affixed by
order of the Board of Directors of said corporation; and that they signed their
names thereto by like order.


                                                        /s/ [ILLEGIBLE]
                                                        -----------------------
                                                        Notary Public
                                                                          (SEAL)

         My commission expires of ____________________.

STATE OF FLORIDA           )
                           ) SS.
COUNTY OF HILLSBOROUGH     )

         I, Lynne Mayberry, a Notary Public in and for the said county in said
state, hereby certify that Robert Thomas whose name as President of Port Sutton,
Inc., a corporation, is signed to the foregoing conveyance, and who is known to
me, acknowledged before me on this day that, being informed of the contents of
the conveyance, he, as such officer and with full authority, executed the same
voluntarily for and as the act of said corporation.

         Given under my hand and seal of office this 2Oth day of July, 1984.

                                                     /s/ LYNNE MAYBERRY
                                                     --------------------------
                                                     Notary Public
                                                                          (SEAL)

         My commission expires: [ILLEGIBLE]
                                -----------

This Instrument Prepared By:


-----------------------------
Michael F. Jordan, Attorney
Ashland Petroleum Company
Division of Ashland Oil, Inc.
2000 Ashland Drive
Ashland, Kentucky 41169


                                      -6-
<PAGE>

                               AGREEMENT OF LEASE

         THIS AGREEMENT OF LEASE, made as of the 16th day of December 1976, by
and between PORT SUTTON INC.; A Florida corporation, herein called "LESSOR", and
EASTERN SEABOARD PETROLEUM COMPANY, INC., a Florida corporation, herein called
"LESSEE",

                                   WITNESSETH;

         That in consideration of the mutual covenants and agreements herein
contained, the Lessor does hereby lease unto the Lessee the real property
situate at Port Sutton, southeast of the City of Tampa, in Hillsborough County,
Florida, described on Exhibit "A" attached hereto and made a part hereof.

         TOGETHER with an easement or easements for the non-exclusive use of:

         (a) The East-West dock known as Berth 24 located on the south side of
Port Sutton channel as indicated on the sketch marked Exhibit "B" and attached
hereto, together with the bollards and other appurtenances to such dock and the
private channel of Lessor connecting the same with the main ship channel of
Hillsborough Bay.

         (b) The wharf area adjacent to the aforesaid dock outlined on Exhibit
"B" in red.

         (c) Easements for utilities and for ingress and egress to and from the
aforesaid dock and wharf area over roads, railroads and other rights-of-way
from time to time designated by the Lessor necessary or convenient for the
leased premises to be operated by the Lessee as a petroleum products terminal.

         The real property and easements hereinbefore described are hereinafter
called "the leased premises."

         TO HAVE AND TO HOLD the above-described premises, together with the
tenements, hereditaments, appurtenances and easements thereunto belonging upon
the terms and conditions hereinafter stated for a term of ten (10) years,
commencing on the 16th


<PAGE>

day of December, 1976, and extending to and including the 15th day of December,
1986.

         1. Lessee agrees to pay Lessor as rental for leased premises and use of
wharfage facilities and the easements hereinabove described the following.

            A. Monthly land rent at the rate of Two Hundred Fifty Dollars
($250.00) per acre in the leased premises; plus

            B. Wharfage for products brought into the leased premises from
vessel, truck, railcar or pipeline as follows:

            $0.02 per barrel for the first 2,000,000 barrels

            $0.015 per barrel for the second 2,000,000 barrels

            $0.01 per barrel over 4,000,000 barrels.

            C. Lessee agrees that minimum wharfage will aggregate a minimum of
Three Thousand Dollars ($3,000.00) per acre in any contract year. If at the end
of any contract year, Lessee has unloaded insufficient volume of product to
bring the minimum wharfage to a sum equal to Three Thousand Dollars ($3,000.00
times the number of acres in the leased premises (and remitted therefor), it
will within the following fifteen days remit an additional amount sufficient to
bring the annual payment for such contract year up to a total equal to Three
Thousand Dollars ($3,000.00) times the number of acres in the leased premises.

            D. In the event the docking facility on Port Sutton Channel becomes
unusable for more than 96 hours through no fault of the Lessee, its agents or
employees, or by vessels serving the Lessee, the annual minimum wharfage shall
be reduced by the ratio of hours the docking facility is unusable to the total
hours in the contract year. This reduction in minimum wharfage shall not alter
the demurrage provisions of other paragraphs in this contract.

         2. In addition to the amounts hereinabove specified, the Lessor will
charge dockage to or against the various vessels employed in the movement of
materials to and from the leased premises at a rate not greater than the then
current rates estab-

                                      -2-


<PAGE>
lished by the applicable tariff of the Tampa Port Authority. In the event the
Tampa Port Authority ceases to publish its tariffs, then the dockage charge will
be established by mutual agreement of the parties for the balance of any lease
term or extensions thereof.

         3. The leased premises shall be used solely and only for the storage
and handling of petroleum products. The premises shall not be used for other
purposes except upon the prior written consent of Lessor. Lessee shall have the
right to place or install for its exclusive use, on the leased premises
unloading facilities, tanks, scales, boilers, pipelines, and other fixtures and
equipment, including office buildings and appurtenant structures for the conduct
of its business thereon. Any facilities placed within the wharf area shall be so
placed and maintained as to facilitate the joint use of said wharf area by the
Lessee and the Lessor or its licensees or other tenants. -- All buildings and
appurtenances erected or installed on the leased premises shall be properly
designed and built to meet all applicable building codes and shall be maintained
in good order and condition.

         Lessee shall not engage in general stevedoring but may charge other
tenants, present and future, of Port Sutton, Inc. an appropriate fee for the use
of any facilities, pipelines, or appurtenances which Lessee has placed on the
leased premises and easements for its exclusive use; the written consent of the
Lessor shall be obtained prior to enacting any such agreement.

         4. Lessor covenants and agrees to maintain the dock, constructed in
accord with the plans marked Exhibit C and attached hereto, as well as a berth
and channel to the main ship channel of Hillsborough Bay having a depth of
thirty-four (34) feet at mean low water; provided, however, the Lessee shall be
responsible for any damage to any such facilities by its agents or employees or
by vessels serving the Lessee.

         5. In the event any vessel owned by or under the control or direction
of the Lessee sinks or becomes disabled for




                                      -3-

<PAGE>
reasons other than those caused by Lessor at any dock, channel, slip, turning
basin, or fairway located at Port Sutton, the Lessee will promptly and with all
reasonable speed refloat and remove said vessel and all debris so as not to
interfere with the use of any such mooring facility or channel, or otherwise
impede safe navigation to and from Port Sutton facilities; provided, however,
that nothing herein contained shall prevent Lessee from recovering its costs and
damages from the party causing, or contributing to the cause, of such sinking or
disablement.

         6. This lease is made upon the express condition that the Lessor shall
be free from all liabilities and claims for damages and suits for or by reason
of any injury or injuries to any person or persons or property of any kind
whatsoever, whether the person or property of Lessee, its agents, or employees,
or third persons, from any cause or causes whatsoever while in or upon the
leased premises or any part thereof during the term of this agreement or
occasioned by any occupancy or use of the leased premises or any activity
carried on by Lessee in connection therewith; provided, however, Lessee shall
not be liable for the negligence of the Lessor or any of its agents, guests,
servants or employees. Each party covenants and agrees to indemnify and save
harmless the other party from all liabilities, charges, expenses (including
attorneys' fees) and costs on account of or by reason of any such injuries,
liabilities, claims, suits or losses however occurring or damages growing out of
same, for which the parties are liable hereunder.

         7. The Lessee agrees to procure and to constantly maintain in force, at
its expense, comprehensive general liability and property damage insurance, in
companies satisfactory to the Lessor, the policies thereof to name the Lessor as
an additional assured and to have limits of not less than $500,000.00 for death
or injury of any one person and $1,000,000.00 for death or injury to persons
from any one accident, and property damage



                                      -4-

<PAGE>
of not less than One Million Dollars ($1,000,000.00).

         8. Except as provided in paragraph 4 above, the Lessee shall keep the
leased premises and all improvements erected thereon at all times in good
condition and repair, shall pay all water, gas, electric, and other utility
expenses incident to the occupation and use of the leased premises, and shall
pay all taxes and assessments levied upon or assessed against the land described
on Exhibit "A" hereof and any improvements thereon during the primary term
hereunder, or any extension or renewal thereof.

         9. The Lessee shall not permit the leased premises or any improvements
thereon or the estate of the Lessee in the same to become subject to any lien,
charge, or encumbrance whatsoever and shall indemnify and keep indemnified the
Lessor against all such liens, charges, and encumbrances; it being expressly
stipulated that the Lessee shall have no authority, express or implied, to
create any lien, charge or encumbrance upon the leased premises or the
improvements now or hereafter located thereon or upon the estate of the Lessee
in the same. Nothing herein contained shall restrict Lessee from selling the
facilities constructed by it on the leased premises; and in the event of such a
sale, the purchaser thereof shall be relieved of any obligations hereunder, but
Lessee shall continue to be bound by the terms and conditions hereof.

         10. The Lessee shall permit the Lessor and its agents at all reasonable
times to enter upon the leased premises to view the condition of the premises
and any improvements thereon.

         11. The Lessee shall not make or suffer any use or occupancy of the
leased premises contrary to any law or ordinance now or hereafter in force, and
shall strictly comply with all laws, ordinances, and rules of any governmental
authorities, bodies, or commissions having jurisdiction. The Lessee shall
conduct its business and operations on the leased premises in such a manner so
as not to create a nuisance, or interfere with





                                      -5-
<PAGE>
or cause any damages or inconvenience to other tenants of the Lessor, their
agents or employees.

         12. The Lessee agrees that if by reason of its failure to perform any
of the covenants or provisions of this lease, the Lessor shall be compelled to
do so or shall do any act which requires the payment of money, then the sum or
sums so paid or required to be paid, together with the legal interest and any
penalties and costs and attorney's fees shall be considered as so much
additional rental and if not paid by Lessee to Lessor upon ten (10) days written
demand then the Lessor shall have the same rights and remedies as in the case of
the failure of the Lessee to pay the rental.

         13. The Lessee shall indemnify the Lessor against all costs and
expenses, including counsel fees, lawfully and reasonably incurred in
enforcing the terms and conditions of this lease, or in the defense of any
action or proceeding involving this lease, or in discharging the premises from
any charge, lien or encumbrance, or in obtaining possession after default of the
Lessee or the determination of this lease.

         14. Upon the expiration of this lease or any extension or renewal
hereof, or upon any earlier termination of this lease, Lessee shall yield up and
surrender the leased premises in the same condition as they were at the time it
originally took possession thereof, reasonable fair wear and tear excepted. The
Lessee is specifically given the right at termination of this lease if not in
default, to remove from said premises all improvements, machinery, equipment and
other personal property placed thereon by Lessee, but, if Lessee removes any
part of a permanent improvement or structure, the Lessee must remove the whole
of such improvement or structure and restore the site upon which structure or
improvement was located to its original condition. Any property remaining on the
leased premises ninety (90) days after the termination of this lease shall
become the property of the Lessor without process of law, but this provision



                                      -6-
<PAGE>



shall not limit the Lessor's right under the preceding sentence to require the
Lessee to complete the removal of any improvement or structure theretofore
partially removed by the Lessee, and should the Lessee fail to so restore the
premises, the Lessor may do so at the expense of the Lessee.

         15. The Lessor covenants that the Lessee, on paying the rental herein
reserved and performing the covenants on its part to be performed, shall and may
peaceably and quietly have, hold and enjoy the leased premises during the term
hereof; provided, however, should the Lessee fail to make the rental payments
hereby required and the same shall remain unpaid after thirty (30) days'
written notice to pay the same, or if the Lessee shall neglect or fail to
perform or observe any of the covenants contained in this instrument which are
on its part to be performed and after thirty (30) days' written notice the same
have not been performed or observed, or if the leasehold interest shall be taken
on execution or other process of law and such proceedings are not dismissed and
the premises returned to the Lessee within sixty (60) days, or if the Lessee
shall petition to be or shall be declared a bankrupt or insolvent according to
law, or if any assignment shall be made of its property for the benefit of
creditors, then and in any of the said cases the Lessor lawfully may,
immediately or at any time thereafter, and without further notice or demand,
enter into and upon the said premises or any part thereof in the name of the
whole, and repossess the same as its own fee simple estate, and expel the Lessee
and those claiming under it, and remove their effects (forcibly, if necessary)
without being taken or deemed guilty of any manner of trespass, and without
prejudice to any remedies which might otherwise be used for arrears of rental or
preceding breach of covenant, and that upon entry as aforesaid this lease shall
be terminated; and the Lessee covenants and agrees that, notwithstanding the
termination of this lease and possession regained by the Lessor, it will be and
remain liable to the Lessor, after



                                      -7-

<PAGE>




such possession regained, for any loss sustained by the Lessor on account of the
premises being let for the remainder of the original term or any extension
thereof for a less sum than before, or at the election of the Lessor, the Lessee
will, on and after such termination and so long as the demised premises have not
been relet, pay to the Lessor, at the times and in the proportions herein named
for the payment of rental, a sum equal to the rental and other payments herein
named as liquidated damages for so much of the unexpired term as expires with
each such payment, or at the election of the Lessor made upon the termination as
aforesaid, or after such payment of liquidated damages as hereinbefore
provided, the Lessee will pay to the Lessor as damages such a sum as at the time
of such termination represents the difference between the rental value of the
leased premises for the remainder of the said term and the rental and other
payments herein named. No waiver by the Lessor of any covenant contained in this
lease shall be a waiver of any succeeding breach of the same covenant.

         16. Neither the Lessor nor the Lessee shall be deemed to be in default
on account of any failure or delay of performance of any obligation hereunder
when such failure or delay shall be due to any cause or causes beyond its
reasonable control; provided that the party so failing or delaying shall
exercise due diligence to try to remove promptly such cause or causes, excepting
only disputes involving the settlement of strikes or other labor disputes;
provided further, however, that this paragraph 16 shall not relieve Lessee of
the obligation to remit the sums provided in paragraph 1 of the agreement. In
the event Lessee's inability to use the leased premises is due to Lessor's labor
disputes, strikes or other labor difficulty, then Lessee's obligations under
paragraph 1(b) and 1(c) shall be reduced pro rata for the period of
non-utilization caused by Lessor.

         17. All notices to the Lessee shall be sent by registered or certified
mail addressed to Post Office Box 3233, Jacksonville, Florida, 32206, or at such
other address as the Lessee shall designate in writing.




                                      -8-
<PAGE>



         18. All notices to the Lessor shall be sent by registered mail to the
Lessor at Post Office Box "E", Tampa, Florida, 33675, or at such other address
as the Lessor shall designate in writing. Notwithstanding any provisions in this
lease to the contrary concerning modifications, a change in address may be
effected by a registered or certified letter sent by either party to the other.

         19. All payments to the Lessor under the terms of this lease shall be
made at the address designated for notice to the Lessor.

         20. Lessor has good right and authority to enter into this lease and
shall warrant and defend its right to do so. Lessor further warrants that there
are no liens, charges, or encumbrances upon the leased premises, except current
taxes, and that it will indemnify and keep indemnified the Lessee against any
and all future liens, charges, and encumbrances, other than taxes to be paid by
Lessee as hereinbefore provided.

         21. This Lease may not be assigned by the Lessee without prior written
permission of the Lessor, which permission shall not be unreasonably withheld.

         22. The Lessor owns vacant land west of the leased premises which are
[illegible] for future terminals of liquid products. Lessee [illegible]
hereinbefore mentioned are for the non-exclusive use on a berth-in-turn basis;
except that Lessee shall not have a permit for the unloading of more than one
vessel of any other tenant. In order to facilitate availability of the berth,
Lessee will furnish Lessor a schedule of expected vessel movements affecting its
terminal, and, in any case, will notify Lessor at least seventy-two (72) hours
prior to each arrival or at the time of Lessee's vessel sails from its last port
of call, whichever is later.

         Lessor will permit no use of the berth by vessels requiring more than
thirty-six (36) hours to load or unload and will require that each vessel
unloading or loading at the berth to expeditiously discharge at the maximum
capacity of the vessel




                                      -9-
<PAGE>
compatible with the terminal facilities and to vacate the berth as soon as
possible after discharge.

         In the event Lessee's vessel is delayed as a result of a previous
vessel occupying the berth for more than thirty-six (36) hours, or, in the
event Lessor fails to make available the berth as hereinabove provided, Lessor
will pay the full demurrage charges incurred by the Lessee as a result of the
delay.

         Lessee further agrees that it will expeditiously start and complete its
unloading at the maximum pumping capacity of the vessel compatible with the
terminal facilities and vacate the berth as soon as possible after discharge
upon the request of the Lessor. If Lessee fails to vacate the berth after
thirty-six (36) hours as provided above, Lessee will pay to Lessor any demurrage
Lessor is obligated to pay other tenants using the berth due to Lessee's failure
to vacate.

         23. Lessee shall have two successive options of renewing and extending
this lease, each such renewal and extension to be for a period of ten years
beginning with the date of termination of the preceding ten year lease. Each
such option shall be exercised by giving written notice to the lessor no less
than ninety (90) days prior to the expiration of the lease then in effect. Each
such lease or extension entered into pursuant to an exercise of such option
shall be on the same terms and conditions as those expressed herein, except that
the rental rate, wharfage and minimum wharfage, shall be increased or decreased
for the next ensuing ten years by an amount calculated by multiplying the base
rental set forth in paragraph 1 above by a fraction whose numerator is The
Consumer Price Index, U. S. City Average, All Items (Base Year 1967) published
by the Bureau of Labor Statistics, U.S. Department of Labor, for the third month
prior to expiration of such 10-year period whose denominator shall be said
consumer price index (U. S. City Average, All Items) for the first month of the
original term of this lease. Should the Bureau of Labor Statistics change the
manner of computing The Consumer Price Index, the Bureau shall be requested to
furnish a conversion factor designated to adjust the new Index to the one
previously



                                      -10-
<PAGE>
in use, and adjustment to the new Index shall be made on the basis of such
conversion factor. Should the publication of the Consumer Price Index be
discontinued by the Bureau of Labor Statistics, then such other Index as may be
published by such Bureau most nearly approaching said discontinued Index shall
be used in making the adjustments herein provided. Should the Bureau discontinue
the publication of an Index approximating the Index herein contemplated, then
such Index as may be published by another United States Government agency as
most nearly approximates the Index herein first above mentioned shall govern and
be substituted as the Index to be used, subject to the application of an
appropriate conversion factor to be furnished by the governmental agency
publishing the adopted Index. In the event of any valid delay caused by seeking
the proper adjustment for rental payments, as herein provided, Lessee shall
continue paying the rental under the last preceding rental adjustment as herein
provided, until such time as said proper adjustment has been made, at which time
an adjustment shall be made retroactive to the beginning of the year in which
the adjustment should have been made.

         In any event, the land rent, wharfage, and annual minimum payment shall
be no less than specified in Paragraph 1 above.

         24. The Lessor agrees to provide and maintain a road for Lessee's
non-exclusive use from the southeast corner of the leased property described in
Exhibit "A" to Highway U.S. 41. Such road shall be suitable for the two-way
traffic of the largest trucks allowed on State of Florida highways. Should
lessor dedicate said road to public usage, and a governmental entity accept the
road for maintenance providing lessee with ingress and egress, then lessor shall
be relieved of its responsibility.

         IN WITNESS WHEREOF, the parties hereto have caused these presents to be
properly executed by their proper officers



                                      -11-
<PAGE>





in due form of law, the day and year first above written.


LESSOR:                                      LESSEE:

PORT SUTTON, INC.                            EASTERN SEABOARD PETROLEUM
                                             COMPANY, INC.


BY  /s/ ROBERT THOMAS                        BY  /s/ JOHN W. CONNOLLY JR.
    -------------------------------              -------------------------------
                        President                                    President



ATTEST:

BY  DOROTHY C. BERGER                        BY  W. ALVIN WATSON
    -------------------------------              -------------------------------
              Assistant Secretary                          Assistant Secretary

STATE OF FLORIDA            )
COUNTY OF HILLSBOROUGH      )   ss


         I HEREBY CERTIFY, That on this 15th day of December, 1976, before me,
the undersigned authority, personally appeared Robert Thomas and Dorothy C.
Berger to me known to be the persons described in and who executed the foregoing
instrument as President and Secretary, respectively, of PORT SUTTON, INC., a
Florida corporation, and who severally and duly acknowledged the execution of
such instrument as such officers aforesaid, for and on behalf of and as the act
and deed of said corporation for the uses and purposes therein expressed,
pursuant to authority lawfully conferred upon them by said corporation and that
the seal affixed thereto is the true and genuine corporate seal of said
corporation and was affixed thereunto by the said Secretary, under like
authority, he being the proper custodian thereof.

         WITNESS my hand and official seal the date aforesaid,


                                         /s/ GLORIA J. ALLEN
                                         ---------------------------------------
                                         Notary Public for State of Florida
                                           at Large

                                         My commission expires:

                                         Notary Public State of Florida at Large
                                         My Commission Expires Nov. 5, 1977




                                      -12-
<PAGE>


STATE OF FLORIDA      )
COUNTY OF DUVAL       )      ss


         I HEREBY CERTIFY, That on this 16th day of December, 1976, before me
the undersigned authority personally appeared John W. Connolly Jr. and W. Alvin
Watson to me known to be the persons described in and who executed the foregoing
instrument as President and Secretary, respectively, of EASTERN SEABOARD
PETROLEUM COMPANY, INC., a Florida corporation, and who severally and duly
acknowledged the execution of such instrument as such officers aforesaid, for
and on behalf of and as the act and deed of said corporation, for the uses and
purposes therein expressed, pursuant to authority lawfully conferred upon them
by said corporation; and that the seal affixed thereto is the true and genuine
corporate seal of said corporation and was affixed thereunto by the said
Assistant Secretary under like authority, he being the proper custodian thereof.

         WITNESS my hand and official seal the date aforesaid.



                                        /s/ JOHN A. BLAIR
                                        ------------------------------------
                                                   Notary Public

                                        My commission expires:


                                        Notary Public, State of Florida at Large
                                        My commission expires July 27, 1980




                                      -13-
<PAGE>


                              [PROPERTY BOUNDARIES]


Exhibit A to Lease
Agreement between Port
Sutton, Inc. and Eastern
Seaboard Petroleum Company
Inc. dated December 16,
1976


Beginning at the NE corner of Section 4, Township 30 South, Range 19 East,
Hillsborough County, Florida, run South 2,020 feet parallel to the East boundary
of said Section 4; Thence run West 4,160 feet parallel to the North boundary of
said Section 4 to the Point of Beginning of the tract hereinbelow described:
Thence continue West parallel to the North boundary of said Section 4 a distance
of 650 feet; Thence run South parallel to the East boundary of said Section 4 a
distance of 724.9 feet more or less; Thence run northeasterly a distance of
720.8 feet more or less to a point 4,110 feet West and 2,573 feet South of said
Section 4; Thence run North parallel to the East boundary of said Section 4 a
distance of 503 feet; Thence run northwesterly a distance of 70.71 feet more or
less to the Point of Beginning. An area containing 9.94 +/- acres.



<PAGE>
                      FIRST AMENDMENT TO AGREEMENT OF LEASE


         This First Amendment to Agreement of Lease made and entered into this
21st day of May, 1980, by and between Port Sutton, Inc., a Florida corporation
("Lessor") and Eastern Seaboard Petroleum Company, Inc., a Florida corporation,
("Lessee").

                                   WITNESSETH:

         WHEREAS, Lessor and Lessee previously entered into an Agreement of
Lease (the "Agreement of Lease") dated December 16, 1976 covering certain real
property situated at Port Sutton, southeast of the City of Tampa, in Hillborough
County, Florida together with nonexclusive easements, as described in said
Agreement of Lease, and

         WHEREAS, Lessee has requested that the Lessor construct for the
Lessee's exclusive use a vessel mooring system described in Subparagraph 2(a)
below (the "Vessel Mooring System") adjacent to and west of the area covered by
the above referenced Agreement of Lease and grant to Lessee certain easement or
easements for the exclusive use of Lessee; and

         WHEREAS, Lessor has agreed to construct the Vessel Mooring System to be
identified as Berth 25 and to grant the requested easements all to be located as
indicated on the sketch attached hereto and made a part hereof as Exhibit "C",

         NOW THEREFORE, for and in consideration of the sum of One Dollar
($1.00) each to the other hand paid, receipt of which is hereby acknowledged,
and other valuable consideration, Lessor and Lessee stipulate and bind
themselves and agree as follows:

         1. The definition of the Leased Premises in the Agreement of Lease is
modified to add the following after item (c):

            "Together with: (i) The exclusive right to Lessee to use the
      rectangular area outlined in red as shown on Exhibit C and being an area
      starting where the new sea wall joins the existing sea wall at a point on
      the westerly side of Berth 24 and whose easterly/westerly running parallel
      sides are four hundred feet in length and whose northerly/southerly
      running parallel sides are seventy-five feet in length and the southerly
      most easterly/westerly line of which runs along the northern edge of the
      new sea wall, and such exclusive right to be subject only to the right of
      Lessor in accordance with the terms of the Agreement of Lease to permit
      the mooring of ships at Berth 24 and to run mooring lines from such moored
      ship to a mooring bollard located immediately south of this described area
      as such bollard is shown on Exhibit C.


                                   Exhibit B

<PAGE>


                  (ii) The exclusive use of the Vessel Mooring System to be
         constructed in accordance with the terms of this amendment.

                  (iii) An exclusive easement, to be located as marked in yellow
         on attached Exhibit C running from real property leased to Lessee by
         Lessor as described in the Agreement of Lease and as shown In Exhibit A
         to the Agreement of Lease to the new sea wall as described in this
         amendment to be constructed by Lessor and along that sea wall to and
         among the various facilities constituting the Vessel Mooring System
         which easement shall be for the purpose of installation of below ground
         and above ground petroleum products lines; water lines; electrical
         lines; communication lines and other utilities or services reasonably
         required by Lessee in connection with its use of the Vessel Mooring
         System (such services being collectively referred to as "Lessee Support
         Services"),

                  This easement includes the right exercisable by Lessee from
         time to time, to install, replace, repair, maintain and operate the
         Lessee Support Services, and

                  (iv) A non exclusive easement for ingress and egress to and
         from the Lessee Support Services and the Vessel Mooring System and the
         area described in Subparagraph (i) above, over roads, railroads and
         other rights-of-way from time to time designated by the Lessor as
         necessary or convenient for the Leased Premises."

         2(a) Lessor shall construct and maintain in good repair for Lessee's
exclusive use and in accordance with the drawing and specifications attached
hereto and made a part hereof as Exhibit C the Vessel Mooring System adjacent to
and west of the portion of Leased Premises described in the Agreement of Lease,
which Vessel Mooring System shall consist of

                  (i) a 400 foot extension of the sea wall in a westerly
         direction which shall be constructed in the same fashion and of the
         same quality, materials and workmanship as the existing sea wall in the
         Berth 24 area;

                  (ii) five mooring dolphins connected to the sea wall by
         walkways; and

                  (iii) one loading platform.

         (b) Lessee shall have the right from time to time to install on the
constituents of the Vessel Mooring System such equipment, pipe lines, machinery
and other facilities which Lessee finds desirable in accordance with its use of
the Vessel Mooring System (such facilities being collectively referred to as
"Lessee Support Facilities"), and Lessor shall not be responsible for the
maintenance or repair of the Lessee Support Services or the Lessee Support
Facilities except where damage is caused to such facilities or services as a
result of Lessor's fault or negligence. At any time during the continuance of
the effectiveness of this Amendment or within ninety (90) days after the
termination or nonrenewal hereof, however arising, Lessee will sever and remove
from the Leased Premises any Lessee Support Facilities or Lessee Support



                                       2.
<PAGE>
Services. If Lessee removes any part of such Lessee Support Facilities or
Lessee Support Services, Lessee, except as otherwise provided at Paragraph 8
hereof, shall be obligated to restore to its original condition, fair wear and
tear excluded, Lessor's property upon which the Lessee Support Services or
Lessee Support Facilities were located.

         In the event that Lessee decides to install or attach any equipment
(i.e., pipelines, machinery or other facilities) on or to the Vessel Mooring
System, all permits, fees and construction costs shall be paid by Lessee.

         Lessee agrees to hold harmless and indemnify Lessor against all claims
brought against Lessor which arise out of the fault or negligence of the Lessee
in connection with the installation or use of the equipment attached by Lessee
to the vessel mooring system and Lessor agrees to hold harmless and indemnify
Lessee against all claims brought against Lessee arising out of the fault or
negligence of the Lessor in the construction and maintenance of the vessel
mooring system. The foregoing indemnifications include reasonable legal fees and
costs incurred in defense of such claims.

         (c) Lessor shall maintain a depth of at least ten (10) feet at mean low
water beginning immediately on the northerly side of the loading platform and
the breasting dolphins shown in Exhibit C attached hereto and continuing
northerly to the main ship channel of Port Sutton channel.

         3. Paragraphs 1 and 2 of the Agreement of Lease are deleted, effective
as of the first day of the first month after the date on which the Vessel
Mooring System has been completed in accordance with the provisions of this
Amendment and turned over to Lessee for Lessee's use, and replaced with the
following:

         "l.(a) Lessee agrees to pay Lessor for performance of Lessor's
         obligations under this Agreement and as rental for the Leased Premises,
         including without limitation the rental of the premises described in
         Exhibit A of the Agreement of Lease and Exhibit C of this Amendment and
         the wharfage facilities and the easements described in the Lease
         Agreement and this Amendment, the following amounts plus the amounts
         prescribed in Paragraph 2 below:

                (i) monthly land rent at the rate of Two Hundred and Fifty
         Dollars ($250.00) per acre in the portion of the Leased Premises
         described in Exhibit A to the Agreement of Lease which contains 10.24
         acres for purposes hereof; plus

                (ii) Wharfage for petroleum products brought into and taken from
         Lessee's terminal located on the portion of the Leased Premises
         described in Exhibit A to the Agreement of Lease and such wharfage to
         be calculated as follows:

                (A) for petroleum products brought into said portion of the
         Leased Premises whether brought in by vessel, truck, rail car or pipe
         line,




                                       3.
<PAGE>




         $0.02 per barrel for the first 2,000,000 barrels per lease year,

         $0.015 per barrel for the second 2,000,000 barrels per lease year, and

         $0.01 per barrel for all amounts over 4,000,000 barrels per lease year

         The wharfage to be charged pursuant of this Part (A) will aggregate a
minimum of Three Thousand Dollars ($3,000.00) per acre in the portion of the
Leased Premises described in Exhibit A to the Agreement of Lease (which
constitutes 10.24 acres for purposes hereof) in any Lease Year. For purposes of
this calculation a Lease Year shall be deemed to begin on the 16 day of December
and continue through the 15 day of the following December during the term of
this lease.

         (B) for petroleum products taken out of said portion of the Leased
Premises by vessel: the rate shall be one-half the rate in effect in paragraph 1
(a) (ii) (A) above.

         The wharfage to be charged pursuant to this Part (B) will aggregate a
minimum of Six Thousand Five Hundred Dollars ($6,500.00) per Amendment Year. For
purposes hereof an Amendment year shall start with the first day of the first
month after the date on which the Vessel Mooring System has been completed in
accordance with the provisions of this Amendment and turned over to Lessee for
Lessee's use and shall end with the last day of the twelfth calendar month
thereafter, said Amendment Year to consist of a total of twelve consecutive
calendar months.

         (C) If at the end of any Lease Year or Amendment Year, whichever is
applicable, there has been insufficient volume of petroleum products either
brought into said portion of the Leased Premises or taken out of said portion of
the Leased Premises, as shall be applicable to the particular calculation, to
bring the wharfage to a sum equal to the minimum set forth in Part (ii) (A) or
(B), as applicable, Lessee will within the following fifteen (15) days remit an
additional amount sufficient to bring the annual payment for such Lease Year or
Amendment Year, whichever is applicable, up to said minimum.

         (b)(i) In the event the docking facility on Port Sutton Channel as
described in the Agreement of Lease becomes unuseable for more than ninety-six
hours through no fault of the Lessee, its agents or employees, or by vessel
serving the Lessee, the annual minimum wharfage set forth at Subparagraph
l(a)(ii)(A) above shall be reduced by the ratio of hours the docking facilities
is unuseable to the total hours in the Lease Year.



                                       4.
<PAGE>



         (ii) In the event the Vessel Mooring System becomes unuseable for more
then ninety-six hours through fault of the Lessor, its agents or employees, the
annual minimum wharfage set forth at Subparagraph l(a)(ii)(B) and the dockage
set forth below in Subparagraph 2(b) shall each be reduced by the ratio of hours
the Vessel Mooring System is unuseable to the total hours in the Amendment Year.

         In the event the Vessel Mooring System becomes unuseable through the
fault of Lessee; its agents or employees, the annual wharfage set forth at
subparagraph l(a)(ii)(B) and the dockage set forth below in subparagraph 2(b)
shall continue in full force and effect.

         In the event that Lessor terminates this Amendment pursuant to
Paragraph 7 hereof, the annual minimum wharfage set forth at Subparagraph
l(a)(ii)(B) and the dockage set forth at Subparagraph 2(b) below shall be
prorated to the portion of the Amendment Year prior to the effective date of the
termination.

         (iii) These reductions in minimum wharfages shall not alter the
dumurrage provisions of other sections in the Agreement of Lease.

2(a) In addition to the amounts specified in Paragraph 1 and in Part (b) of this
Paragraph 2, the Lessor will charge dockage to or against the various vessels
employed in the movement of petroleum products to and from the docking
facilities described on the sketch marked Exhibit B to the Agreement of Lease at
a rate not greater than the then current rates established by the applicable
tariff of the Tampa Port Authority. In the event the Tampa Port Authority ceases
to publish its tariffs, then the dockage charge will be established by mutual
agreement of the parties for the balance of any lease term or extensions
thereof.

         (b) In addition to the amounts specified in Paragraph 1 and in Part (a)
of this Paragraph 2, Lessor will charge, in lieu of dockage relative to the
Vessel Mooring System, Twenty-two Thousand Dollars ($22,000.00) per Amendment
Year ($1,833.33 per month, payable monthly in advance.)

         (c) Any wharfage amounts due pursuant to Subsection l(a)(ii) shall be
payable on a monthly basis within fifteen (15) days after the end of the month
to which the amounts apply.

         (d) All wharfage calculations shall be based on Lessee's loading and
unloading records as maintained by Lessee, or such other mutually agreeable
method. Lessor shall have a right during normal business hours to have access
to, inspect and make copies of Lessee's loading records as are relevant to
wharfage amounts due pursuant to Subparagraph l(a)(ii)."




                                       5.
<PAGE>



         4. The first seven words of Paragraph B of the Agreement of Lease
reading "except as provided in Paragraph 4 above," are deleted and replaced with
the following: "Except as provided in Subparagraph 2.(a) of this Amendment and
in Paragraph 4 of the Agreement of Lease,".

         5. Paragraph 23 of the Agreement Lease is deleted and replaced with the
following:


                  "23 Lessee shall have two successive options of renewing and
         extending this Lease, including this Amendment, each such renewal and
         extension to be for a period of ten (10) years beginning with the date
         of termination of the preceding ten (10) year lease. Each such option
         shall be exercised by giving written notice to the Lessor no less than
         ninety (90) days prior to the expiration of the term then in effect.
         Alternatively, Lessee may elect to exercise this option as to the
         Leased Premises described in the Agreement of Lease prior to change by
         this Amendment and in such case the extension shall not apply to the
         Leased Premises described above at Paragraph 1 of this Amendment and in
         such case or in case of cancellation by Lessor in accordance with
         Paragraph 7 of this Amendment, Lessee's obligation to make any further
         payments as described at Subparagraphs l(a)(ii)(B) and 2(b) of the
         Agreement of Lease as amended hereby shall terminate at the end of the
         Lease Term then in effect or at the time of cancellation as applicable.
         Except to the extent otherwise provided immediately above in this
         section, each such lease or extension entered into pursuant to an
         exercise of such option shall be on the same terms and conditions as
         those expressed herein, except that the rental rate, wharfages and
         minimum wharfages, described in Paragraph 1 of the Agreement of Lease
         as amended hereby shall be increased or decreased for the next ensuing
         ten years by an amount calculated by multiplying the base amount for
         which the adjustment is being calculated as set forth at Paragraph 1 of
         the Agreement of Lease as amended hereby by a fraction whose numerator
         is The Consumer Price Index, U.S. City Average All Items (Base Year
         1967) published by the Bureau of Labor Statistics, U.S. Department of
         Labor, for the third month prior to expiration of the ten year lease
         period then in effect, and (a) whose denominator shall be said Consumer
         Price Index (U.S. City Average All Items) for the first month of the
         original term of this lease insofar as calculation of the increase or
         decrease of the amounts set forth at Subparagraphs (a)(i), (ii)(A) and
         (ii)(B) of Paragraph 1 of the Agreement of Lease as amended hereby.
         Should the Bureau of Labor Statistics change the manner of computing
         the Consumer Price Index, the Bureau shall be requested to furnish a
         conversion factor designated to adjust the new index to the one
         previously in use, and adjustment to the new index will be made on the
         basis of such conversion factor. Should the publication of the Consumer
         Price Index be discontinued by the Bureau of Labor Statistics, then
         such other index as may be published by said Bureau most nearly
         approaching said discontinued index shall be used in making the
         adjustments herein provided.





                                       6.
<PAGE>

                  Should the Bureau discontinue the publication of an index
         approximating the index herein contemplated, then such index as may be
         published by another United States Government Agency as most nearly
         approximates the index herein first above mentioned shall govern and be
         substituted as the index to be used, subject to the application of an
         appropriate conversion factor to be furnished by the governmental
         agency publishing the adopted index.

                  In the event of any valid delay caused by seeking the proper
         adjustment for rental payments as herein provided, Lessee shall
         continue paying the rental under the last preceding rental adjustment
         as herein provided, until such time as said proper adjustment has been
         made, at which time adjustment shall be made retroactive to the
         beginning of the year in which the adjustment should have been made.

                  In any event, the land rent, wharfage and annual minimum
         wharfage payment shall be no less than specified in Paragraph 1 of the
         Agreement of Lease as amended hereby.

         6. The lease term of the portion of the Leased Premises described in
this Amendment shall commence as of the first day of the first month after the
date the Vessel Mooring System has been completed in accordance with the
provisions of this Amendment and turned over to Lessee for Lessee's use and
shall run, subject to the termination provisions and opt[on rights of this
Amendment, with the term of the Agreement of Lease.

         If the Lease Term of the portion of the Leased Premises described in
this Amendment has not begun, for any reason whatsoever except the default of
the Lessee in performance of its obligations under this Amendment, within one
year after the date hereof, Lessee shall have the right, on thirty (30) days
written notice to Lessor, to cancel this Amendment.

         7. Lessor specifically reserves the right to terminate this Amendment
for the portion of the Leased Premises described in this Amendment by giving
Lessee six months prior written notice of such termination where Lessor must
build a deepwater dock for a prospective lessee or purchaser in order to lease
or sell the land immediately to the south of the Vessel Mooring System.

         8. The fourth sentence of paragraph 3 of the Agreement of Lease which
sentence reads 'Any facilities placed within the wharf area shall be so placed
and maintained to facilitate the joint use of said wharf area by the Lessee and
the lessor or its licensees or other tenants' as applied to the Vessel Mooring
System shall mean that the facilities placed on the Vessel Mooring System by
Lessee shall not unreasonably hinder or prevent the use of the wharf area
adjacent to the east west dock known as Berth 24 by both Lessee and Lessor or
Lessor's licensees or other tenants as such use is contemplated by this
Agreement of Lease.



                                       7.
<PAGE>
      9. In the event of termination of this Amendment pursuant to Paragraph 7
of this Amendment or in the event of expiration of the term of this Amendment
without termination of, or expiration of the term of the Agreement of Lease,
Lessee and Lessor shall be relieved of all obligations under this Amendment, and
the Agreement of Lease, unamended by this Amendment, shall remain in full force
and effect.

      10. All the terms, provisions and conditions of the Agreement of Lease,
not amended or modified herein, shall apply to the Leased Premises described in
this Amendment as fully and completely as if such terms, provisions and
conditions were set forth in this Amendment.



      IN WITNESS WHEREOF, the parties hereto have executed this Agreement the
day and year first above written.

LESSOR: Port Sutton, Inc.             LESSEE: Eastern Seaboard Petroleum
                                              Company, Inc.

BY:  /s/ ROBERT THOMAS                BY:  /s/ BEN W. MATHEWS
   -------------------------------       -------------------------------
Its: President                        Its: Vice President
    ------------------------------        ------------------------------

Attest: /s/ [ILLEGIBLE]               Attest: /s/ JOHN A. BLAIR
       ---------------------------           ---------------------------
        Secretary-Treasurer                   Secretary-Treasurer



                                       8.

<PAGE>









STATE OF FLORIDA        )
                        ) ss.
COUNTY OF DUVAL         )

         I hereby certify that on this day before me, an officer duly authorized
in the state aforesaid and in the county aforesaid to take acknowledgements,
personally appeared Ben W. Mathews and John A. Blair, to me known and know to be
the persons described in and who executed the foregoing instrument as Vice
President and Secretary-Treasurer, respectively, of the corporation named
therein, and severally acknowledged before me that they executed the same as
such officers in the name and on behalf of said corporation.

         Witness my hand and official seal in the county and state aforesaid
this 20th day of May, A.D. 1980.


                                        /s/ DURWOOD H. BOZZELL
                                        ---------------------------------------
                                                     Notary Public

                                        NOTARY PUBLIC STATE OF FLORIDA AT LARGE
                                            MY COMMISSION EXPIRES OCT 20, 1983
[SEAL]                                   BONDED THRU GENERAL INS. UNDERWRITERS



STATE OF FLORIDA        )
                        ) ss.
COUNTY OF HILLSBOROGH   )


         I hereby certify that on this day before me, an officer duly authorized
in the state aforesaid and in the county aforesaid to take acknowledgments,
personally appeared Robert Thomas and Henry Toland, to me known and known to be
the persons described in and who executed the foregoing instrument as President
and Secretary-Treasurer, respectively, of the corporation named therein, and
severally acknowledged before me that they executed the same as such officers in
the name and on behalf of said corporation.

         Witness my hand and official seal in the county and state aforesaid
this 29th day of May, A.D. 1980.


                                        /s/ BETTY FOSTER
                                        ---------------------------------------
                                                     Notary Public

                                         Notary Public, Florida, State at Large
                                           My Commission Expires Sept. 9, 1983
[SEAL]






                                       9.





<PAGE>





                         SECOND AMENDMENT TO BE ATTACHED
                           TO AGREEMENT OF LEASE DATED
                           DECEMBER 16, 1976, BETWEEN
                              PORT SUTTON, INC. AND
                  EASTERN SEABOARD PETROLEUM COMPANY, INC. FOR
                              PREMISES LOCATED IN
                   PORT SUTTON, HILLSBOROUGH COUNTY, FLORIDA



         THIS SECOND AMENDMENT TO LEASE of December 16, 1976, by and between
PORT SUTTON, INC., a Florida corporation, hereinafter called LESSOR, and EASTERN
SEABOARD PETROLEUM COMPANY, INC., a Florida corporation, hereinafter referred to
as LESSEE,

         WITNESSETH: That for and in consideration of the terms and conditions
contained in the original Lease of December 16, 1976, which was amended by First
Amendment To Agreement Of Lease dated May 21 1980, and for the purpose of
further amending said Lease it is now agreed as follows:

         1. Article 2(a)(ii) on page two of the First Amendment To Agreement Of
Lease is amended to the extent that the Vessel Mooring System shall consist of
six mooring dolphins connected to the sea wall by walkways.

         2. Article 3, paragraph l(a)(ii)(B) on page four of the First Amendment
To Agreement Of Lease is amended to the extent that the wharfage to be charged
pursuant to this Part (B) will aggregate a minimum of Seven Thousand Dollars
($7,000.00) per Amendment Year.

         3. Article 3, paragraph 2(b) on page five of the First Amendment To
Agreement Of Lease is amended to the extent that in addition to the amounts
specified in Paragraph 1 and in Part (a) of Paragraph 2 of said Amendment,
Lessor will charge in lieu of dockage relative to the Vessel Mooring System,
Twenty-three Thousand Two Hundred Fifty Dollars ($23,250.00) per Amendment Year
($1,937.50 per month, payable monthly in advance.)

         4. Exhibit "C" attached to the First Amendment To Agreement Of Lease,
is revised, showing the addition of one (1) breasting dolphin, to be located on
the same east-west line as the original five (5) breasting dolphins and seventy



                                   EXHIBIT C



<PAGE>
feet (70') east of the easternmost original breasting dolphin. A copy of the
"revised" Exhibit C is attached hereto and made a part hereof.

         5. In all other respects the original Agreement Of Lease of December
16, 1976, as amended by the First Amendment To Agreement Of Lease of May 21,
1980, between the parties is hereby confirmed and ratified.

         Executed in multiple copies this the 10th day of October, 1980.

WITNESSES:                              LESSOR:
                                        PORT SUTTON, INC.

/s/ DOROTHY C. BERGER                   By: /s/ ROBERT THOMAS
-----------------------------              ----------------------------
/s/ EMILY I. FRANK                      Its: President
-----------------------------               ---------------------------

                                        ATTEST:

                                        By: /s/ SHERRY TOLAND
                                           ----------------------------
                                        Its: Secretary-Treasurer
                                            ---------------------------

WITNESSES:                              LESSEE:
                                        EASTERN SEABOARD PETROLEUM
                                        COMPANY INC.

/s/ THEO V. TILLENHART                  By: /s/ BEN W. MATTHEWS
-----------------------------              ----------------------------
/s/ [ILLEGIBLE]                         Its: Vice President
-----------------------------               ---------------------------

                                        ATTEST:

                                        By: /s/ JOHN A. BLAIR
                                           ----------------------------
                                        Its: Secretary-Treasurer
                                            ---------------------------



STATE OF FLORIDA        )
                        ) ss.
COUNTY OF DUVAL         )

         I hereby certify that on this day before me, an officer duly authorized
in the state aforesaid and in the county aforesaid to take acknowledgements,
personally appeared Ben W. Mathews and John A. Blair, to me known and known to
be the persons described in and who executed the foregoing instrument as Vice
President and Secretary-Treasurer respectively, of the corporation named
therein, and severally acknowledged before me that they executed the same as
such officers in the name and on behalf of said corporation.

         Witness my hand and official seal in the county and state aforesaid
this 6th day of October, A.D. 1980.


                                        /s/ DURWOOD H. BOZZELL
                                        ---------------------------------------
                                                     Notary Public

                                        NOTARY PUBLIC STATE OF FLORIDA AT LARGE
                                            MY COMMISSION EXPIRES OCT 20, 1983
                                          BONDED THRU GENERAL INS. UNDERWRITERS



                                      -2-
<PAGE>
                                   EXHIBIT B


                                  THE SUBLEASE


<PAGE>
                               SUBLEASE AGREEMENT

                  THIS SUBLEASE AGREEMENT (this "Sublease") is entered into as
of the 22nd day of November, 2000, by and between MARTIN GAS SALES, INC., a
Texas corporation ("Sublessor"), and CF MARTIN SULPHUR, LP, a Delaware limited
partnership ("Sublessee").

                                   WITNESSETH:

                  WHEREAS, Sublessor currently leases from the Tampa Port
Authority, a body politic and corporate organized and existing under the laws of
the State of Florida ("Master Lessor"), approximately 10.274 acres of land
("Leased Premises") situated in Port Sutton, southeast of the City of Tampa, in
Hillsborough County, Florida, and more particularly described in the Master
Lease (defined below), pursuant to that certain Agreement of Lease (assigned and
amended as described below) dated December 16, 1976 (the "Original Master
Lease"), by and between Port Sutton, Inc., a Florida corporation ("Original
Master Lessor"), as lessor, and Eastern Seaboard Petroleum Company, Inc., a
Florida corporation (the "Original Master Lessee"), as lessee;

                  WHEREAS, the Original Master Lease has been: (i) amended by
that certain First Amendment to Agreement of Lease ("First Amendment") dated May
21, 1980; (ii) amended by that certain Second Amendment to Lease dated October
10, 1980; (iii) assigned by Original Master Lessee to Steuart Petroleum Company,
a Delaware corporation ("Second Master Lessee"), pursuant to that certain Lease
Assignment and Agreement effective August 14, 1984; (iv) amended by that certain
Third Amendment to Lease dated effective August 15, 1984; (v) assigned by
Original Master Lessor to Master Lessor by instrument effective September 21,
1984; (vi) amended by that certain Amendment No. 4 to Agreement of Lease
("Fourth Amendment") dated July 13, 1987; (vii) amended by that certain
Amendment No. 5 to Agreement of Lease ("Fifth Amendment") dated December 5,
1988; (viii) assigned by Second Master Lessee to Boliden Chemicals, Inc., a
Delaware corporation ("Third Master Lessee"), by instrument effective February
16, 1989; (ix) amended by that certain Amendment No. 6 to Agreement of Lease
("Sixth Amendment") dated February 16, 1989; (x) amended by that certain
Amendment No. 7 to Agreement of Lease ("Seventh Amendment") dated May 13, 1992;
(xi) assigned by Third Lessee to Sublessor pursuant to that certain Assignment
and Assumption Agreement dated March 28, 1995; and (xii) amended by Amendment
No. 8 to Agreement of Lease (the "Eighth Amendment") dated December 16, 1996
(the Original Master Lease, as so amended and assigned, the "Master Lease");

                  WHEREAS, a copy of said Master Lease is attached hereto as
Exhibit A; and

                  WHEREAS, Sublessor desires to sublet to Sublessee, subject to
and upon the terms and conditions contained herein, (i) for the exclusive use of
Sublessee, that certain portion of the Leased Premises described on the Legal
Description attached hereto as Exhibit B, and identified (by horizontal
hatching) on the Site Plan attached hereto as Exhibit C (each of which exhibits
is incorporated herein and made a part hereof for all purposes), which portion
contains




                                       1
<PAGE>

approximately 1.69 acres of land (hereinafter, the "Controlled Premises"), and
(ii) for the non-exclusive use of Sublessee, all easements and areas, and rights
of use and access necessary or pertaining to the Controlled Premises (except for
the Vessel Mooring System, defined and described in the First Amendment) which
are appurtenant to the Leased Premises under the Master Lease, as the same are
in part identified (by vertical hatching) on Exhibit C (hereinafter, the "Common
Areas"), to the extent to which the same are held by Sublessor pursuant to the
Master Lease (the Controlled Premises and the Common Areas are collectively
referred to hereinafter as the "Subleased Premises").

                  NOW, THEREFORE, for and in consideration of Ten and No/100
Dollars ($10.00) and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, Sublessor and Sublessee hereby
covenant and agree as follows:

         1. DEFINED TERMS. All capitalized terms used herein and not defined
herein shall have the meanings ascribed thereto in the Master Lease.

         2. SUBLEASE; USE. Sublessor hereby subleases and grants to Sublessee,
and Sublessee hereby subleases and accepts from Sublessor, the Subleased
Premises, on and subject to the terms and conditions contained in this Sublease.
Sublessee shall use the Subleased Premises only for the uses permitted under the
terms and provisions of the Master Lease (including, without limitation,
Paragraph 3 of the Original Master Lease, as modified by Paragraph 1 of the
Sixth Amendment and Paragraph 3 of the Eighth Amendment).

         3. TERM. The term of this Sublease shall commence on October 31, 2000
("Sublease Commencement Date"), and shall terminate on December 14, 2006
("Sublease Term"); provided, however, the Sublease Term shall in no event extend
beyond the term of the Master Lease, and provided further, that this Sublease
may terminate or be terminated earlier pursuant to the terms of the Master Lease
or this Sublease.

         4. CONDITION OF SUBLEASED PREMISES. The Subleased Premises shall be
delivered to Sublessee by Sublessor in its present condition existing on the
Sublease Commencement Date. Sublessor and Sublessee agree that none of the terms
contained in the Master Lease with respect to the construction or completion of
improvements (including, without limitation, the construction and maintenance of
the Vessel Mooring System) are applicable to the Subleased Premises or this
Sublease, except as expressly set forth in this Sublease below. From and after
the Sublease Commencement Date, Sublessee hereby assumes all risks associated
with the Controlled Premises and all improvements, equipment, fixtures or
facilities constructed or located therein or thereon (including the physical
condition of any of the foregoing), and Sublessee shall indemnify and hold
harmless Sublessor from and against any claim, loss, damage, expense (including
without limitation reasonable attorneys' fees and costs) or liability arising
out of or based upon any injury or damage to person or property occurring on the
Controlled Premises during the Sublessee's occupancy of the Controlled Premises
under this Sublease, unless caused by the negligence or intentional torts of
Sublessor, or its agents, servants or employees.



                                       2
<PAGE>

         Furthermore, except as otherwise expressly provided in this Sublease to
the contrary, Sublessor shall not be liable to Sublessee, or to Sublessee's
agents, servants or employees for any claim, loss, damage, expense or liability
arising out of or based upon any injury or damage to person or property
occurring on the Common Areas which is caused by the negligence or intentional
torts of Sublessee, or its agents, servants or employees, and Sublessee shall
indemnify and hold Sublessor harmless from and against all liability and claims
(including, without limitation, reasonable attorneys' fees and costs) for or
related to the same. Except as otherwise expressly provided in this Sublease to
the contrary, Sublessee shall not be liable to Sublessor, or to Sublessor's
agents, servants or employees for any claim, loss, damage, expense or liability
arising out of or based upon any injury or damage to person or property
occurring on the Common Areas which is caused by the negligence or intentional
torts of Sublessor, or its agents, servants or employees, and Sublessor agrees
to indemnify and hold Sublessee harmless from and against all liability and
claims (including, without limitation, reasonable attorneys' fees and costs) for
or related to the same.

         5. MASTER LEASE. This Sublease is subject and subordinate to the Master
Lease. Except as may be inconsistent with the terms and provisions hereof and of
any consent to this Sublease executed by Sublessor, Sublessee and the Master
Lessor, the terms and provisions of the Master Lease (including, without
limitation, any and all terms or provisions concerning hazardous waste and/or
environmental condition, compliance, inspection, liability and/or indemnity,
and/or rights of removal concerning improvements, machinery, equipment and other
personal property on the Subleased Premises; specifically including, without
limitation, Paragraphs 5 and 6 of the Fourth Amendment, and Paragraph 14 of the
Original Master Lease, respectively) shall be applicable to this Sublease as and
to the extent that such provisions relate to the Subleased Premises, and shall
be incorporated into this Sublease (i) as if Sublessor were Lessor under the
Master Lease and Sublessee were Lessee under the Master Lease, and (ii) as if
the Subleased Premises were the Leased Premises under the Master Lease, except
to the extent inconsistent with the agreements and understandings expressed in
this Sublease or to the extent prior to the Sublease Commencement Date or after
the expiration of the Sublease term. Notwithstanding the foregoing, the
following provisions of the Master Lease are expressly not incorporated herein
and such provisions shall have no application to Sublessee or the Subleased
Premises:

                  A. Paragraphs 17, 18 and 20, the first sentence of Paragraph
         22, Paragraph 23 and any provision creating construction or maintenance
         obligations contained in Paragraph 24 (it being understood that
         Sublessor shall have no such obligations and that Sublessee shall have
         access to the road described therein) of the Original Master Lease;

                  B. Any provision creating construction or maintenance
         obligations, and/or any provision passing an "exclusive" use, contained
         in Paragraphs 1 and/or 2 (it being understood that Sublessor shall have
         no such obligations and that Sublessor and Sublessee shall share the
         rights to access, ingress and egress and any other rights of use or
         easements created or described therein), Paragraph 5 and the second
         paragraph of Paragraph 6 of the First Amendment;

                  C.       Paragraph 4 of the Fourth Amendment;



                                       3
<PAGE>

                  D.       Paragraph 5 of the Fifth Amendment; and

                  E.       Paragraphs 5, 6 and 7 the Seventh Amendment.

         Where reasonably necessary, the terms of the Master Lease, as
incorporated into this Sublease as aforesaid, shall be construed in light of the
fact that Sublessor (unlike Master Lessor) does not own a fee interest in the
Subleased Premises but only a leasehold interest under the Master Lease.
Sublessor and Sublessee anticipate that Master Lessor's performance in
accordance with the Master Lease shall fulfill the equivalent obligation of
Sublessor hereunder, and in the event of Master Lessor's default under the
Master Lease, Sublessee's rights shall be limited as provided in the following
subparagraph of this Section 5. As between Sublessor and Sublessee, if the terms
of this Sublease conflict with the terms of the Master Lease, then the terms of
this Sublease shall control. Sublessee shall perform and observe all the
obligations, covenants and conditions contained in the Master Lease on
Sublessor's part that are incorporated hereinabove by reference and to the
extent that the obligations, covenants and conditions apply and accrue from and
after the Sublease Commencement Date. Each of Sublessor and Sublessee will not
cause or allow to be caused any default under the Master Lease as to its
respective portion thereof. Sublessee hereby indemnifies and holds Sublessor
harmless from and against any claim, loss, damage, expense (including without
limitation reasonable attorneys' fees and costs) or liability arising under the
Master Lease with respect to the Subleased Premises, from and after the Sublease
Commencement Date, from or related to Sublessee's failure to perform Sublessee's
obligations under this Sublease, including, without limitation, those
obligations of Sublessor pursuant to the Master Lease which are incorporated
herein by reference. Sublessee acknowledges that it has received and reviewed
the Master Lease, in the form attached hereto as Exhibit A. Except as may be
expressly set forth in Section 4 above, Sublessee is not relying on, and
Sublessor has made no representations, warranties or statements regarding, the
interpretation or application of the terms of the Master Lease.

         At Sublessee's written request, Sublessor will exercise the rights and
remedies Sublessor has under the Master Lease with respect to the Subleased
Premises, and at law or in equity, so designated by Sublessee in its request.
Such rights and remedies shall be pursued diligently by Sublessor; however,
Sublessee shall be obligated to reimburse Sublessor for Sublessor's reasonable
out-of-pocket costs of exercising such rights or remedies. Notwithstanding
anything to the contrary contained in this Sublease, Sublessor shall not be
deemed in default under this Sublease if Master Lessor fails to perform its
obligations under the Master Lease. Sublessee shall indemnify, hold harmless and
defend (with counsel reasonably satisfactory to Sublessor) Sublessor from and
against any claim, loss, damage, expense or liability arising from or in
connection with Sublessor's assertion of rights or pursuit of remedies under the
Master Lease either (a) at the request of Sublessee or (b) following Sublessee's
assertion of the same right or pursuit of the same remedy against Sublessor
under this Sublease upon grounds which, if proven, would justify the pursuit of
the same right or remedy under the Master Lease (e.g., termination in the event
of condemnation). The foregoing notwithstanding, Sublessor shall not be required
to do or perform any act which would constitute a default by Sublessor under the
Master Lease.

         In the event that Sublessor receives notice of default from Master
Lessor under the Master Lease, Sublessor shall immediately notify Sublessee of
the same, and Sublessee shall have the right, but not the obligation, to attempt
to cure such default, in which event Sublessor



                                       4
<PAGE>

shall reimburse Sublessee for all reasonable costs related to such cure expended
by Sublessee. If Sublessee cures such default, and Sublessor fails to reimburse
Sublessee for the cost of such cure within thirty (30) days of Sublessee's
demand therefor, Sublessee shall be entitled to demand and receive an assignment
by Sublessor of all of Sublessor's right, title and interest under the Master
Lease, and Sublessor agrees to execute and deliver such assignment to Sublessee
within thirty (30) days following Sublessor's receipt of Sublessee's demand for
such assignment, pursuant to the terms of this paragraph.

         Notwithstanding any provision to the contrary of this Sublease or of
any consent to this Sublease executed by Sublessor, Sublessee and the Master
Lessor, in no event shall Sublessee be entitled to receive assignment of the
Master Lease pursuant the terms of this Section 5 (or of any such consent) if
(i) the default under the Master Lease giving rise to such right of assignment
shall occur as a result of any act or omission of the Sublessee (including,
without limitation, any act or omission constituting a default by Sublessee
under Section 14 of this Sublease), or (ii) this Sublease has been terminated
(in accordance with the terms of this Sublease) prior to the date of such
default.

         6. SECURITY DEPOSIT. Sublessee shall not be required to deposit a
security deposit as a condition to this Sublease.

         7. RENT. Sublessee hereby accepts this Sublease and agrees that
Sublessee shall be obligated to pay to Sublessor all amounts due under the
Master Lease respecting the use and/or possession of the Subleased Premises,
including, without limitation, (i) monthly bare land rent (which rent Sublessee
shall be obligated to pay pro rata, based on the proportion of the amount of
area constituting the Controlled Premises compared to the amount of area
constituting the Leased Premises, which proportion is hereby deemed to be
15.7680%), (ii) any and all wharfage for products brought onto or shipped out of
the Controlled Premises, including any and all minimum wharfage guarantees (as
the same may be adjusted), (iii) any and all dockage charges charged and/or
owing with respect to vessels employed in the movement of materials to and from
the Controlled Premises, (iv) any and all Vessel Mooring Charges (if any)
applicable to Sublessee, and (v) any and all real and personal property taxes,
sales taxes and other taxes payable by Sublessor with respect to the Controlled
Premises or activities related thereto pursuant to the terms of the Master
Lease. All of the foregoing sums shall be paid by Sublessee to Sublessor in
accordance with the terms and provisions of the Master Lease, as if Sublessor
were Lessor under the Master Lease and Sublessee were Lessee under the Master
Lease; subject, however, to shortening of time limits as provided in Paragraph
14(b) below, and provided, that the sums owing under subclauses (ii), (iii),
(iv) and (v) above shall not be due and payable by Sublessee to Sublessor until
five (5) days after delivery by Sublessor to Sublessee of an invoice therefor.

         8. NOTICES. Notices required by this Sublease shall be in writing. All
such notices shall be served personally or sent by United States certified mail,
return receipt requested, or private air courier, postage or charge prepaid,
addressed to Sublessor or Sublessee, as the case may be, at its address set
forth below, or at such other place as Sublessee or Sublessor may from time to
time designate in a written notice to the other. Notices may also be sent by
facsimile transmission, provided a duplicate copy is sent to the addressee by
certified mail. Such



                                       5
<PAGE>

notices shall be deemed sufficiently served or given when faxed, two (2) days
after deposit in any U.S. Post Office, or by overnight air courier service on
actual receipt by the recipient.

                  If to Sublessor:  Martin Gas Sales, Inc.
                                    PO Box 191
                                    4200 Stone Road
                                    Kilgore, Texas 75663
                                    Fax:     903.983.6262
                                    Attn:    Ruben S. Martin, III

                  If to Sublessee:  CF Martin Sulphur, LP
                                    PO Box 191
                                    4200 Stone Road
                                    Kilgore, Texas 75663
                                    Fax:  (903) 983-6262
                                         --------------------------------------
                                    Attn:  Ruben S. Martin, III
                                         --------------------------------------

                  With a copy to:   CF Industries, Inc.
                                    One Salem Lake Drive
                                    Long Grove, Illinois 60047
                                    Fax:  847-438-0211
                                    Attn: Stephen R. Wilson

                  And:              CF Industries, Inc.
                                    One Salem Lake Drive
                                    Long Grove, Illinois 60047
                                    Fax:  847-438-0211
                                    Attn: John H. Sultenfuss


                  9. SERVICES. Without limiting the provisions of Section 5
above, Sublessor shall have no liability or responsibility for the provision of
any services to the Subleased Premises. Rather, Master Lessor will provide such
services in accordance with, and only to the extent required by, the terms of
the Master Lease. No failure of Master Lessor to provide services to the
Subleased Premises, and no interruption in the provision of such services, shall
cause Sublessor to be in default under this Sublease; nor shall Sublessee have a
right to an abatement of rent or a right to terminate this Sublease with respect
to the same, except to the extent such rights are held by Sublessor under the
Master Lease.

                  10. SUBLESSOR RESTORATION AND REPAIRS. Without limiting the
provisions of Section 5 above, as between Sublessor and Sublessee, Sublessor
shall have no liability or responsibility for maintenance, repairs, rebuilding
or restoration of the Subleased Premises, except to the extent that any such
maintenance, repairs, rebuilding or restoration are made necessary by the
negligent act or omission of Sublessor or its agents, employees, or contractors.
Rather, Master Lessor will provide and conduct such maintenance, repairs,
rebuilding and/or restoration in accordance with, and only to the extent
required by, the terms of



                                       6
<PAGE>

the Master Lease. No failure of Master Lessor to provide such maintenance,
repairs, rebuilding or restoration shall cause Sublessor to be in default under
this Sublease nor shall Sublessee be entitled to an abatement of rent or to
terminate this Sublease unless and to the extent that Sublessor is entitled to
an abatement of rent under the Master Lease or to terminate the Master Lease.

                  11. ASSIGNMENT AND SUBLETTING. Subject to the provisions of
this Section 11 set forth below, Sublessee shall not, without Sublessor's prior
written consent (which may be withheld in Sublessor's absolute discretion), and
the consent of Master Landlord (i) assign, convey, mortgage, pledge, encumber,
or otherwise transfer this Sublease or any interest hereunder; (ii) allow any
lien to be placed upon Sublessee's interest hereunder; (iii) sublet the
Subleased Premises or any part thereof; or (iv) permit the use or occupancy of
the Subleased Premises or any part thereof by any one other than Sublessee (all
of the foregoing, an "Assignment"). Any attempt to consummate an Assignment
without Sublessor's consent shall be of no force or effect and shall be an event
of default under this Sublease. Notwithstanding the foregoing, Sublessee may,
without Sublessor's prior written consent, assign any or all of its rights,
interests and obligations hereunder if such Assignment (x) is made to a
wholly-owned subsidiary of Sublessee, provided that any such subsidiary agrees
in writing to be bound by all of the terms, conditions and provisions contained
herein, or (y) occurs by operation of law. Notwithstanding any provision to the
contrary contained herein, no Assignment shall relieve Sublessee of its
obligations hereunder.

                  12. SUBORDINATION. Sublessee accepts this Sublease subject and
subordinate to any mortgages and/or deeds of trust now or at any time hereafter
constituting a lien or charge on the Subleased Premises or the improvements
situated thereon; provided, however, Sublessee's subordination of this Sublease
to any such mortgage hereafter placed by Sublessor is expressly conditioned upon
the delivery to Sublessee, simultaneously with the closing of such mortgage, a
written agreement of the applicable mortgagee (in a form reasonably acceptable
to Sublessee and to such mortgagee) that so long as Sublessee is not in default
under the provisions of this Sublease (including all applicable grace periods),
Sublessee's rights under this Sublease and possession of the Subleased Premises
shall not be disturbed by such mortgagee or by any persons or parties claiming
by, through or under such mortgagee (whether or not such persons or parties
acquired its or their rights as a result of foreclosure); and, provided further,
that any mortgagee, trustee, or holder of any mortgage or deed of trust may
elect at any time to cause its interest to be subordinate and junior to
Sublessee's interest under this Sublease by filing an instrument in the real
property records of the county in the state where the Subleased Premises is
located, effecting such election and providing Sublessee with notice of such
election. Sublessee, at any time hereafter on demand, shall execute any
instruments, releases or other documents that may be required by any present or
future mortgagee, trustee, or holder of any mortgage or deed of trust for the
purpose of subjecting and subordinating this Sublease to the lien of any
mortgage or deed of trust.

                  13. ASSIGNMENTS BY SUBLESSOR. Sublessor shall have the right
to transfer and/or assign, in whole or in part, all its rights and obligations
hereunder, subject to this Sublease and Sublessee's rights hereunder. Upon
request by Sublessee, Sublessor shall provide Sublessee with prompt written
notice of any such transfer or assignment by Sublessor. Sublessee



                                       7
<PAGE>

agrees to execute a certificate certifying such facts (if true) as Sublessor may
reasonably require in connection with any such transfer and/or assignment by
Sublessor.

                  14.      SUBLESSEE DEFAULTS.

                           (a) In the event that Sublessee shall (i) default in
the performance of any of the terms, covenants and conditions of this Sublease
(including those portions of the Master Lease incorporated herein by reference)
beyond any applicable notice and grace period provided for in the Master Lease
and incorporated herein by reference (as shortened by subparagraph (b) below),
and/or (ii) Sublessee performs or permits the performance of any other act or
event which would constitute or cause an event of default by Sublessor, as
Lessee, under the Master Lease, Sublessor shall be entitled to exercise any and
all of the rights and remedies to which it is entitled by law, including,
without limitation, the remedy of summary proceeding, and also any and all of
the rights and remedies specifically provided for in the Master Lease and
incorporated herein by reference.

                           (b) The time limits contained in the Master Lease for
the giving of notices, making of demands or performing any act, condition or
covenant on the part of Lessee thereunder, or for the exercise by Lessee
thereunder of any right, remedy or option, are changed for the purposes of
incorporation herein by reference by shortening the same in each instance by
three (3) days so that in each instance Sublessee shall have three (3) days less
time to observe or perform hereunder than Sublessor has as Lessee under the
Master Lease; this provision shall not be applicable to any time limit contained
in the Master Lease which is equal to or less than five (5) days, but in such
event such time limit shall be shortened by two (2) days so that in such
instances Sublessee shall have two (2) days less time to observe or perform
hereunder than Sublessor has as the Lessee under the Master Lease.

                  15. PEACEFUL ENJOYMENT. So long as Sublessee is not in default
hereunder (including applicable grace periods), Sublessor covenants that
Sublessee shall have, subject to the terms and provisions of this Sublease and
the Master Lease, quiet and peaceful possession of the Subleased Premises and
enjoy all of the rights herein granted without interference from Sublessor or
anyone acting by, through or under Sublessor.

                  16. SURRENDER OF SUBLEASED PREMISES. Sublessee shall surrender
the Subleased Premises on the expiration or earlier termination of this Sublease
in the same or better condition as existed on the Sublease Commencement Date,
reasonable, ordinary wear and tear and damage by casualty and condemnation
excepted.

                  17. SUCCESSORS. This Sublease shall be binding upon and inure
to the benefit of Sublessor, its successors and assigns, and shall be binding
upon and inure to the benefit of Sublessee, its successors and, to the extent
assignment is permitted hereunder, Sublessee's assigns.

                  18. EXCLUDED RIGHTS. Sublessor shall have no right to modify
the Master Lease, terminate the Master Lease, or expand or otherwise alter,
modify or make any improvements to the Subleased Premises without first
obtaining Sublessee's consent thereto. If



                                       8
<PAGE>

Sublessor acquires any rights to extend the term of, or to renew, the Master
Lease, then, upon Sublessee's request therefor, Sublessor shall exercise such
rights and shall grant to Sublessee the right to extend the term of, or to
renew, this Sublease (as the case may be), but only to the extent to which
Sublessor has the right to do so under the terms of the Master Lease (as
modified), and subject to the prior consent of the Master Lessor.

                  19. LIMITATION OF SUBLESSOR'S LIABILITY. Notwithstanding
anything in this Sublease or the Master Lease to the contrary, Sublessee
specifically agrees to look to solely to Sublessor's interest in the Subleased
Premises for the recovery of any judgment from Sublessor, it being agreed by
Sublessee that neither Sublessor (or its successors) nor Sublessor's (or its
successors') partners, shareholders, officers, directors, managers, agents and
employees shall ever be personally liable for any such judgment.

                  20. ENTIRETY. This instrument and, to the extent incorporated
herein by reference, the Master Lease constitute the entire agreement between
Sublessor and Sublessee and may not be modified orally or in any manner other
than by an agreement in writing signed by Sublessor and Sublessee or their
respective permitted successors in interest. No prior or contemporaneous
promises, inducements, representations or agreements, oral or otherwise, between
Sublessor and Sublessee not embodied herein shall be binding or have any force
or effect.

                  21. MISCELLANEOUS.

                  (a) If Sublessee is a corporation, partnership or other
entity, Sublessee warrants that all consents or approvals required of third
parties (including but not limited to its Board of Directors or partners, to the
extent applicable) for the execution, delivery and performance of this Sublease
have been obtained and that Sublessee has the right and authority to enter into
and perform its covenants contained in this Sublease. Likewise, if Sublessor is
a corporation, partnership or other entity, Sublessor warrants that all consents
or approvals required of third parties (including but not limited to its Board
of Directors or partners) for the execution, delivery and performance of this
Sublease have been obtained and that Sublessor has the right and authority to
enter into and perform its covenants contained in this Sublease.

                  (b) Time is of the essence in this Sublease.

                  (c) The terms and provisions of the Exhibit(s) attached hereto
are hereby made a part hereof for all purposes.

                  (d) This Sublease shall not be deemed or construed to create
or establish any relationship (other than that of landlord and tenant) or
partnership or joint venture or similar relationship or agreement between
Sublessor and Sublessee hereunder.



               [The signature page follows immediately hereafter.]



                                       9
<PAGE>

                                   EXECUTED effective as of the day and year
first above written.

<Table>
<S>                                         <C>
                                            SUBLESSOR:

Executed in the presence of:                MARTIN GAS SALES, INC., a Texas corporation



    /s/  Robert D. Bondurant                By:     /s/ Ruben S. Martin, III
------------------------------------            ---------------------------------------
Name:  Robert D. Bondurant                  Name:   Ruben S. Martin, III
     -------------------------------        Title:  President


    /s/  D. R. Neumeyer
------------------------------------
Name:   D. R. Neumeyer
     -------------------------------

                                            SUBLESSEE:

Executed in the presence of:                CF MARTIN SULPHUR, LP, a Delaware limited
                                            partnership

    /s/  Robert D. Bondurant
------------------------------------
Name:  Robert D. Bondurant                  By:   CF MARTIN SULPHUR, LLC, a Delaware limited
     -------------------------------              liability company, its general partner

   /s/  D. R. Neumeyer
------------------------------------
Name:  D. R. Neumeyer                       By:      /s/  Ruben S. Martin, III
     -------------------------------           ----------------------------------------
                                            Name:   Ruben S. Martin, III
                                                  -------------------------------------
                                            Title:  President
                                                  -------------------------------------
</Table>



                                       10
<PAGE>



THE STATE OF TEXAS       )
                         )
COUNTY OF DALLAS         )

         This instrument was acknowledged before me on the 17th day of November,
2000, by Ruben S. Martin, III as President of CF MARTIN SULPHUR, LLC, a Delaware
limited liability company, general partner of CF MARTIN SULPHUR, L.P., a
Delaware limited partnership, on behalf of said company and partnership.


                                   /s/ F. Gayle McClendon
                                   ------------------------------------------
                                   Notary Public in and for the State of Texas




THE STATE OF TEXAS        )
                          )
COUNTY OF DALLAS          )

         This instrument was acknowledged before me on the   17th   day of
November, 2000, by    Ruben S. Martin,  III      , as     President          of
MARTIN GAS SALES, INC., a Texas corporation, on behalf of said corporation.


                                   /s/ F. Gayle McClendon
                                   --------------------------------------------
                                   Notary Public in and for the State of Texas




                                       11
<PAGE>

                                    EXHIBIT A

                                  MASTER LEASE

                                 [SEE ATTACHED]



                                       A
<PAGE>

                                    EXHIBIT B

                     LEGAL DESCRIPTION OF SUBLEASED PREMISES

BEGINNING AT THE NE CORNER OF SECTION 4, TOWNSHIP 30 SOUTH, RANGE 19 EAST,
HILLSBOROUGH COUNTY, FLORIDA, THENCE RUN SOUTH 2,020 FEET PARALLEL TO THE EAST
BOUNDARY OF SAID SECTION 4; THENCE RUN WEST 4,160 FEET PARALLEL TO THE NORTH
BOUNDARY OF SAID SECTION 4; THENCE RUN SOUTH PARALLEL TO THE EAST BOUNDARY OF
SAID SECTION 4, A DISTANCE OF 552.74 FEET RUN THENCE S.76 degrees11'33"W., A
DISTANCE OF 681.41 FEET; TO THE POINT OF BEGINNING OF THE HEREIN DESCRIBED
PARCEL; RUN THENCE N.02 degrees38'35"W., A DISTANCE OF 21.11 FEET; RUN THENCE
N.76 degrees01'28"E., A DISTANCE OF 396.08 FEET; RUN THENCE N.33
degrees24'18"W., A DISTANCE OF 81.26 FEET; RUN THENCE N.00 degrees00'00"W.,
PARALLEL TO THE EAST BOUNDARY OF SAID SECTION 4, A DISTANCE OF 163.68 FEET; RUN
THENCE N.90 degrees00'00"W., A DISTANCE OF 171.94 FEET; RUN THENCE S.00
degrees00'00"W., PARALLEL TO THE EAST BOUNDARY OF SAID SECTION 4, A DISTANCE OF
200.66 FEET; RUN THENCE S.89 degrees58'25"W., A DISTANCE OF 224.95 FEET; RUN
THENCE S.00 degrees00'00"W., PARALLEL TO THE EAST BOUNDARY OF SAID SECTION 4, A
DISTANCE OF 161.83 FEET; RUN THENCE N.76 degrees11'33"E., A DISTANCE OF 59.98
FEET TO THE POINT OF BEGINNING, CONTAINING 1.69 ACRES MORE OR LESS.



                                       B
<PAGE>


                                    EXHIBIT C

                         SITE PLAN OF SUBLEASED PREMISES

                                 [SEE ATTACHED]



                                       C

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.13
<SEQUENCE>18
<FILENAME>d00990exv10w13.txt
<DESCRIPTION>PURCHASER USE EASEMENT, INGRESS-EGRESS EASEMENT
<TEXT>
<PAGE>
                                                                   EXHIBIT 10.13


When Recorded, Return to:

Martin Operating Partnership, L.P.
P.O. Box 191
4200 Stone Road
Kilgore, Texas 75663
Attn: Bob Bondurant


                                            -----------------------------------
                                            SPACE ABOVE LINE FOR RECORDER'S USE


                PURCHASER USE EASEMENT, INGRESS-EGRESS EASEMENT,
                         AND UTILITY FACILITIES EASEMENT


                  THIS PURCHASER USE EASEMENT, INGRESS-EGRESS EASEMENT, AND
UTILITY FACILITIES EASEMENT (this "Agreement") is made as of the 1st day of
November, 2002, by and between Martin Gas Sales LLC, a Texas limited liability
company ("Grantor"), and Martin Operating Partnership L.P., a Delaware limited
partnership ("Grantee").

                                   WITNESSETH:

                  WHEREAS, Grantor is the owner of that certain land located in
or near the City of Beaumont, County of Jefferson, State of Texas more
particularly described on Exhibit A attached hereto and made a part hereof (the
"Terminal Tract") and the holder of a non-exclusive easement upon, over, under
and across a certain fifty foot (50') strip of land for the maintenance of
underground utility lines and for vehicular and pedestrian ingress and egress
between Texas State Highway 347 and the Terminal Tract (the "Access Easement
Tract") pursuant to that certain Utility and Access Easement Agreement dated
April 22, 1998, recorded under County Clerk's File No. 9814113, Official Public
Records of Real Property Records of Jefferson County, Texas, as amended by
instrument dated October 27, 1999, recorded July 21, 2000 under County Clerk's
File No. 2000027626, Official Public Records of Real Property Records of
Jefferson County, Texas (as amended, the "Access Easement") (the Terminal Tract
and the Access Easement Tract are collectively referred to herein as the
"Grantor's Property") upon which or adjacent to which are located (a) the areas
and easements identified by hatching on Exhibit B attached hereto and made a
part hereof (the "Common Use Areas") and (b) additional areas and easements
within Grantor's Property which have not been identified on Exhibit B attached
hereto, but which are reasonably necessary or convenient for Grantee to have (i)
access between the Benefited Parcel (defined below) and the Common Use Areas,
and (ii) access, ingress and egress, to and from, the Common Use Areas and any
and all existing streets, roadways, rights-of-way, and highways adjacent to the
Grantor's Property (such additional areas and easements set forth in this
subsection (b) are collectively referred to hereinafter as the "Access Routes";
the Access Routes, the Common Areas and the Grantor's Property are collectively
referred to hereinafter as the "Easement Area"); and

                  WHEREAS, by conveyance of even date herewith, Grantor has
conveyed to Grantee that certain land and improvements located in or near the
City of Beaumont, County of Jefferson, State of Texas, which is more
particularly described on Exhibit C attached hereto and made a part hereof (the
"Benefited Parcel"; the Easement Area and the Benefited Parcel are collectively
referred to herein as the "Parcels" and individually as a "Parcel"); and




<PAGE>

                  WHEREAS, as part of the consideration for the conveyance of
the Benefited Parcel by Grantor to Grantee, Grantor has agreed to grant to
Grantee (a) a non-exclusive easement upon, under, over, across and along the
Common Use Areas for purposes of using the Common Use Areas and of gaining
access to the Benefited Parcel therefrom, (b) a non-exclusive easement upon,
under, over, across and along the Access Routes for purposes of gaining access,
ingress and egress, to and from, the Common Use Areas and any and all existing
streets, roadways, rights-of-way, and highways adjacent to the Grantor's
Property, and (c) a non-exclusive easement in, to, under and through Grantor's
Property for purposes of using, accessing, constructing, installing, and
operating certain utility facilities thereat, all upon the terms, provisions and
conditions set forth in this Agreement.

                  NOW, THEREFORE, in consideration of Ten and No/100 Dollars
($10.00), the mutual covenants herein contained and other good and valuable
consideration, the receipt and sufficiency of which are hereby expressly
acknowledged, Grantor and Grantee hereby agree as follows:

                  1. Grantor does hereby give, grant and convey to Grantee and
Grantee's agents, contractors, tenants, licensees, guests, invitees, grantees,
employees, representatives, successors (including, without limitation, any and
all successors to Grantee in title to all or any portion of the Benefited
Parcel) and assigns (collectively, the "Grantee Parties") a non-exclusive,
perpetual right and easement (which easement shall be appurtenant to the
Benefited Parcel) upon, under, over, across and along (a) the Common Use Areas
for purposes of using the Common Use Areas and gaining access to the Benefited
Parcel therefrom and transporting products, steam, water and other substances
through the piping and conduits within the Common Use Areas to and from the
storage tanks located on the Benefited Parcel, (b) the Access Routes for
purposes of gaining pedestrian, vehicular and all other reasonable modes of (i)
access between the Benefited Parcel and the other Common Use Areas and (ii)
access, ingress and egress, to and from, the Common Use Areas and any and all
existing streets, roadways, paths, driveways, rights-of-way and highways
adjacent to the Grantor's Property, from time to time and at any and all times,
(c) such other portions of Grantor's Property as are necessary to gain access to
and from the Benefited Parcel, the Common Use Areas and the Access Roads, and
(d) subject to the terms of Paragraph 3 below, the Easement Area for purposes of
using, accessing, constructing, placing, installing, maintaining, repairing,
replacing, inspecting, patrolling, renewing, and operating, from time to time
(and for the purposes of causing or permitting any third party to take any or
all of the foregoing actions from time to time) on, under and through the
Easement Area, gas, telephone, telecommunications, water, sanitary sewer and
other utility lines, switchboxes, cables, wires and other associated fixtures,
equipment and facilities (collectively, the "Grantee Utility Facilities"), in
order to provide the Benefited Parcel and the Common Use Areas with utility
services, and in connection with the Grantee Parties' exercise of the rights set
forth in this clause (d), the right to enter upon the Easement Area for such
purposes. Except as specifically set forth herein, each and all of the rights,
privileges and easements conferred upon the Grantee Parties pursuant to this
Agreement may be exercised by the Grantee Parties from time to time and at any
time without any notice (prior or subsequent) to Grantor.

                  2. In the event that an emergency, hazardous condition or
other event beyond the reasonable control of Grantee shall from time to time
occur (including, without limitation, strikes, acts of god and actions of law
enforcement authorities) which results in the full or partial closure of (a) the
Access Routes (or any portion thereof) or (b) the roadways, paths, driveways,
rights-of-way or other areas (or any portion thereof) located in the Common Use
Area or other portions of Grantor's Property used by the Grantee Parties for
access between, among, to, and from the Common Use Areas and the Benefited
Parcel, then (in addition to, and not in lieu of, the Grantee Parties' rights
and easements described in Paragraph 1 above), the Grantee Parties shall have
the right, during the continuance of any such closure, to gain emergency
pedestrian, vehicular and all other reasonable modes of access, ingress and
egress, over any portion of the Grantor's Property as required by Grantee to
gain access to and use of the Benefited Parcel and the Common Use Areas. Such
right to access, ingress and egress, may be exercised by


                                        2
<PAGE>

Grantee without prior notice to Grantor, but shall be exercised in a manner that
creates and allows only minimal interference with Grantor's operations conducted
on the Grantor's Property.

                  3. In connection with the exercise by the Grantee Parties of
their rights and easements under clause (d) of the first sentence of Paragraph 1
of this Agreement, Grantee shall provide Grantor with at least fifteen (15) days
advance notice of any proposed construction, placement and installation of
Grantee Utility Facilities, and the construction, placement and installation of
the Grantee Utility Facilities shall not unreasonably interfere with Grantor's
use, occupancy and operation of the Grantor's Property. Grantor acknowledges and
agrees that any Grantee Utility Facilities may be owned and/or operated by third
parties (and not by Grantee), and that (in addition to, and not in lieu of, the
other rights conferred upon Grantee pursuant to this Agreement), Grantee shall
have the right to confer upon any such third parties any or all of the rights to
which Grantee is entitled under clause (c) of the first sentence of Paragraph 1
of this Agreement, which rights shall be exercised in accordance with and
subject to the terms of this Agreement as if such third party were Grantee
hereunder. Grantee shall be responsible for maintaining any Grantee Utility
Facilities, at its sole cost and expense, subject to the terms set forth in
Paragraph 4 below.

                  4. Grantor and its successors and assigns shall be obligated
to maintain and repair the Common Use Areas and keep the Common Use Areas in
good repair and condition, reasonable wear and tear excepted, including without
limitation the maintenance, replacement and repair of all piping, pumps, valves,
gauges, conduits, docks and other facilities located thereon; provided, however,
Grantor shall have no obligation whatsoever to staff or provide employees to
operate the improvements on the Benefited Parcel, except and only to the extent
expressly agreed to in writing by and between Grantor or its successors or
assigns and the owner of the Benefited Parcel. In the event that Grantor or its
successors or assigns fail to conduct necessary items of maintenance,
replacement or repair on the Common Use Areas within a reasonable time after its
receipt of written notice thereof from Grantee (not to exceed ninety [90] days),
then Grantee may undertake to have such items of maintenance, replacement or
repair completed at Grantee's cost, and Grantor or its successor or assign shall
reimburse Grantee for the reasonable cost thereof within thirty (30) days after
its receipt of a detailed written invoice therefor. The foregoing maintenance,
replacement, repair and reimbursement obligations of Grantor shall be covenants
running with the land and shall bind the successors and assigns of Grantor. The
maintenance and repair of the Access Easement Tract shall be governed by the
terms and provisions of the Access Easement.

                  5. Grantor, at Grantor's sole cost and expense, shall have the
right from time to time (but no more frequently than once within any three (3)
year period) to relocate the Common Use Areas to an alternative location on the
Grantor's Property which is acceptable to Grantee; provided, that (a) Grantor
shall have delivered to Grantee at least thirty (30) days' advance notice of any
such relocation (which notice shall designate with specificity the proposed
alternative location of the Common Use Areas), (b) such relocation shall not
materially impair (or make more expensive or more burdensome) any of the rights
of use or access granted upon the Grantee Parties hereunder, (c) at all times
during the period of time required in order to effect such relocation, the
Grantee Parties shall have pedestrian, vehicular and other reasonable modes of
access, ingress and egress, on and over the Easement Area or an alternative
location reasonably designated by Grantor on and over the Grantor's Property
between and among the Benefited Parcel and the Common Use Areas and to and from
the Benefited Parcel and the Common Use Areas and all streets, roadways, paths,
driveways, rights-of-way and highways adjacent to the Easement Area or such
alternative location, (d) the physical condition and condition of title of the
relocated Common Use Areas shall be reasonably acceptable to Grantee, and (e)
promptly following any such relocation, Grantor shall, if Grantee so requests,
execute and record with the County recorder's office an instrument reasonably
acceptable to Grantee designating such new location.


                                       3
<PAGE>

                  6. The terms, conditions, rights and easements contained
herein shall be covenants running with the land and shall be perpetual. This
Agreement shall be recorded, and the terms and conditions contained herein shall
bind, inure to the benefit of, and be enforceable by, the parties hereto and
their respective successors and assigns (including, without limitation, the
respective successors in title to Grantee and Grantor to the Benefited Parcel
and Easement Area).

                  7. Whenever notice is required to be given pursuant to this
Agreement, the same shall be either personally delivered, sent by a nationally
recognized overnight delivery service, postage prepaid, or sent via United
States certified mail, return receipt requested, postage prepaid, and addressed
to the parties at their respective addressed as follows:

         (a)      If to Grantor:            Martin Gas Sales LLC
                                            P.O. Box 191
                                            4200 Stone Road
                                            Kilgore, Texas 75663
                                            Fax: 903.983.6262
                                            Attn: Ruben S. Martin, III

         (b)      If to Grantee:            Martin Operating Partnership, L.P.
                                            P.O. Box 191
                                            4200 Stone Road
                                            Kilgore, Texas 75663
                                            Fax: 903.983.6262
                                            Attn: Ruben S. Martin, III

or such other addresses as any party, by written notice in the manner specified
above to the other party hereto, may designate from time to time. Unless
otherwise specified to the contrary in this Agreement, notice shall be deemed to
have been given on the date the notice is received, if personally delivered, on
the business day after the date the notice is properly sent, if sent by
nationally recognized overnight delivery service, or four (4) business days
after the notice is properly sent, if sent by United States certified mail.

                  8. If any term, provision or condition in this Agreement
shall, to any extent, be invalid or unenforceable, the remainder of this
Agreement (or the application of such term, provision or condition to persons or
circumstances other than in respect of which it is invalid or unenforceable)
shall not be affected thereby, and each term, provision and condition of this
Agreement shall be valid and enforceable to the fullest extent permitted by law.

                  9. The terms and provisions of this Agreement shall be
governed by and construed in accordance with the laws of the State of Texas
applicable to a contract executed and performed in such State, without giving
effect to the conflicts of laws principles thereof.

                  10. The rights granted pursuant to this Agreement shall not
terminate or be in any way impaired by reason of a change of the present uses of
any Parcel of the present improvements or fixtures thereon.

                  11. If either of the Parcels is hereafter divided into two or
more parts by separation of ownership or lease, each portion of such Parcel
shall enjoy the benefits and be subject to the burdens, as applicable, of the
rights, easements and restrictions created hereby.


                                       4
<PAGE>

                  12. Either party hereto (or their respective representatives,
successors and assigns) may enforce this instrument by appropriate action and
the prevailing party in such action shall be entitled to recover as part of its
costs reasonable attorneys' fees and expenses.

                  13. The rule of strict construction does not apply to the
grant of easements contained herein. These grants shall be given a reasonable
construction in order that the intention of the parties to confer a commercially
useable right of enjoyment to Grantee with respect to such easements shall be
effectuated.

                  14. This Agreement may be executed in several counterparts,
each of which shall be deemed an original; further, the signature of the parties
hereto on this Agreement may be executed and notarized on separate pages, and
when attached to this Agreement shall constitute one complete document.

                  15. None of the terms and provisions of this Agreement shall
be deemed to create a partnership between or among the parties hereto in their
respective businesses or otherwise, nor shall any terms or provisions of this
Agreement cause them to be considered joint venturers or members of any joint
enterprise.

                  16. Each party agrees that it will execute and deliver such
other documents and take such other action as may be reasonable requested by the
other party to effectuate the intention of this Agreement.

                  17. The parties acknowledge that the parties and their counsel
have reviewed and revised this Agreement and that the normal rule of
construction to the effect that any ambiguities are to be resolved against the
drafting party shall not be employed in the interpretation of this Agreement or
any exhibits or amendments hereto.

                  18. This Agreement cannot be changed orally or by course of
conduct, and no executory agreement, oral agreement or course of conduct shall
be effective to waive, change, modify or discharge it in whole or in part unless
the same is in writing and is signed by the party against whom enforcement of
any waiver, change, modification or discharge is sought.

                  19. Grantor and Grantee agree and acknowledge that, except as
expressly set forth herein, there are no intended third party beneficiaries of
this Agreement nor any of the rights and privileges conferred herein.

                  20. In the event of any assignment, transfer, conveyance or
sale, once or successively, of all of the right, title and interest of a Grantor
in and to the Easement Area, said Grantor making such assignment, transfer,
conveyance or sale shall be entirely freed and relieved of all covenants and
obligations of the Grantor hereunder accruing after the date of such assignment,
transfer, conveyance or sale, and the Grantee shall look solely to the assignee,
transferee or purchaser with respect thereof; provided, that upon such
assignment, transfer, conveyance or sale, such assignee, transferee or purchaser
shall automatically, and without the necessity of further action of any kind, be
deemed to have assumed all of Grantor's covenants and obligations hereunder
accruing after the date of such assignment, transfer, conveyance or sale. In the
event of any assignment, transfer, conveyance or sale, once or successively, of
all of the right, title and interest of a Grantee in and to the Benefited
parcel, said Grantee making such assignment, transfer, conveyance or sale shall
be entirely freed and relieved of all covenants and obligations of the Grantee
hereunder accruing after the date of such assignment, transfer, conveyance or
sale, and the Grantor shall look solely to the assignee, transferee or purchaser
with respect thereto; provided, that upon such assignment, transfer, conveyance
or sale, such assignee, transferee or purchaser




                                       5
<PAGE>

shall automatically, and without the necessity of further action of any kind, be
deemed to have assumed all of Grantee's covenants and obligations hereunder
accruing after the date of such assignment, transfer, conveyance or sale.


                  IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date and year first above written.

                  GRANTOR

                  MARTIN GAS SALES, LLC,
                  a Texas limited liability company

                  By:      Martin Resource Management Corporation,
                           a Texas corporation, its sole member


                           By: /s/ ROBERT D. BONDURANT
                              --------------------------------------------------
                           Name:    Robert D. Bondurant
                           Title:   Chief Financial Officer



                  GRANTEE

                  MARTIN OPERATING PARTNERSHIP L.P.,
                  a Delaware limited partnership

                  By:      Martin Operating GP LLC,
                           a Delaware limited liability company, its general
                           partner

                           By: Martin Midstream Partners L.P.,
                               a Delaware limited partnership, its sole member

                               By: Martin Midstream GP, LLC,
                                   a Delaware limited liability company, its
                                   general partner


                                   By: /s/ RUBEN S. MARTIN, III
                                      ---------------------------------
                                   Name:  Ruben S. Martin, III
                                   Title: President


                                       6

<PAGE>


STATE OF TEXAS               )
                             )        ss
COUNTY OF DALLAS             )

         I, Adam C. Gallegos, a Notary Public in and for the County and State
aforesaid, DO HEREBY CERTIFY that Robert D. Bondurant, personally known to me to
be the Chief Financial Officer of Martin Resource Management Corporation, a
Texas corporation and sole member of MARTIN GAS SALES LLC, a Texas limited
liability company, and personally known to be to be the same person whose name
is subscribed to the foregoing instrument, appeared before me this day in person
and acknowledged that as such Chief Financial Officer, he signed and delivered
such instrument pursuant to the authority given by such limited liability
company, as his free and voluntary act and deed, and as the free and voluntary
act and deed of such limited liability company, for the uses and purposes
therein set forth.

                  Given under my hand and official seal this 1st day of
November, 2002.

                                        /s/ ADAM C. GALLEGOS
                                        ----------------------------------------
                                        Notary Public

                                        Printed Name: Adam C. Gallegos

                                        My Commission Expires: 10/17/2004



STATE OF TEXAS           )
                         )        ss
COUNTY OF DALLAS         )

         I, Adam C. Gallegos, a Notary Public in and for the County and State
aforesaid, DO HEREBY CERTIFY that Ruben S. Martin, III, personally known to me
to be the President of Martin Midstream GP, LLC, a Delaware limited liability
company and general partner of Martin Midstream Partners L.P., a Delaware
limited partnership and sole member of Martin Operating GP LLC, a Delaware
limited liability company and general partner of MARTIN OPERATING PARTNERSHIP
L.P., a Delaware limited partnership, and personally known to be to be the same
person whose name is subscribed to the foregoing instrument, appeared before me
this day in person and acknowledged that as such President, he signed and
delivered such instrument pursuant to the authority given by such limited
liability company, as his free and voluntary act and deed, and as the free and
voluntary act and deed of such limited liability company, for the uses and
purposes therein set forth.

                  Given under my hand and official seal this 1st day of
November, 2002.

                                           /s/ ADAM C. GALLEGOS
                                           -------------------------------------
                                           Notary Public

                                           Printed Name: Adam C. Gallegos

                                           My Commission Expires: 10/17/2004


                                       7
<PAGE>
                                    EXHIBIT A

                             THE GRANTOR'S PROPERTY


BEING an approximately 7.8158 acre tract or parcel of land out of and a part of
that certain 208.38 acre tract out of the P.H. Humphrey League, Abstract 32,
Jefferson County, Texas; which said 208.38 acre tract of land was conveyed by
Stanolind Oil Purchasing Company to Texas Gulf Sulphur Company by deed dated
June 15, 1950 recorded in volume 1597, Page 324, Deed Records, Jefferson County,
Texas and said 7.8158 acre tract of land being more particularly described as
follows:

         Note:    All bearings are based on the Northeast line of a 6.615 acre
                  tract described as Part 1 of Judgment No. 23421 in The State
                  of Texas vs. Texas Gulf Sulphur Company dated April 27, 1966
                  recorded in Volume 1464, Page 486, Deed Records, Jefferson
                  County, Texas as being North 38(0) 22'00" West.

COMMENCING at an axle found at an Ell corner of said Humphrey League and said
208.38 acre tract, same being the Northwest corner of the John A. Veatch League,
Abstract 55, same being the most Southerly Southeast corner o the Jeff & James
Chaison Survey, Abstract 435, Jefferson County, Texas and being the most
Southerly Southeast corner of a 150 acre tract as conveyed by Perry McFaddin
Duncan, Camelia B. McFaddin, Di Vernon McFaddin and husband, E.G. Cordts, Mamie
McFaddin Ward and husband, Carroll E. Ward, W.P.H. McFaddin, Jr. and J.L.C.
McFaddin to Texas Gulf Sulphur Company by deed dated November 12, 1954 recorded
in Volume 960, Page 192, Deed Records, Jefferson County, Texas;

Thence South 57 degrees 43'02" East a distance of 820.77 feet to a 4/8" iron rod
found at the PLACE OF BEGINNING of the tract or parcel of land herein described;

THENCE North 19 degrees 44'44" East a distance of 96.44 feet to a 5/8" iron rod
found;

THENCE North 47 degrees 09'07" East a distance of 673.89 feet to a 1/2" iron rod
found;

THENCE North 48 degrees 38'32" East a distance of 596.68 feet to a 1/2" iron rod
found;

THENCE South 45 degrees 42'21" East a distance of 87.73 feet to a 1/2" iron rod
found;

THENCE South 53 degrees 30'50" West a distance of 8.90 feet to a 1/2" iron rod
found;

THENCE South 43 degrees 50'30" East a distance of 260.00 feet to a 1/2" iron rod
found;

THENCE South 45 degrees 31'31" West a distance of 1217.60 feet to a 1/2" iron
rod found;

THENCE North 52 degrees 39'42" West a distance of 348.52 feet to the PLACE OF
BEGINNING, containing 10.6679 acres of land, more or less;

LESS AND EXCEPT THE FOLLOWING FOUR (4) PARCELS:

SAVE AND EXCEPT TRACT NO. 1:

BEING a 0.4122 acre tract or parcel of land situated in the P.H. Humphrey
League, Abstract No. 32, Jefferson County, Texas and being out of and part of
that certain called 10.6679 acre tract of land as


                                      A-1

<PAGE>

conveyed by Palmera Properties, Inc. to Martin Gas Sales, Inc., as recorded in
Clerk's File No. 98-9814112, Official Public Records of Real Property, Jefferson
County, Texas, said 0.4122 acre tract of land being more particularly described
as follows:

      Note:    All bearings are based on the most Southerly portion of the
               Northwesterly line of the said 10.6679 acre Martin Gas Sales,
               Inc. tract as NORTH 19 degrees44'40" EAST as recorded in the
               above referenced deed.

COMMENCING at a 5/8" iron rod found for the most Westerly corner of the said
10.6679 acre Martin Gas Sales, Inc. tract, said corner also being the POINT OF
BEGINNING of the said 10.6679 acre tract as described in the above referenced
deed;

THENCE SOUTH 52 degrees 39'42" EAST, along and with the Southwesterly line of
the said 10.6679 acre Martin Gas Sales, Inc. tract, for a distance of 348.52
feet to a point, said point being the most Southerly corner of the said 10.6679
acre Martin Gas Sales, Inc. tract;

THENCE NORTH 45 degrees 31'31" EAST, along and with the Southeasterly line of
the said 10.6679 acre Martin Gas Sales, Inc. tract, for a distance of 366.26
feet to a point;

THENCE NORTH 44 degrees 28'29" WEST, perpendicular to the Southeasterly line of
the said 10.6679 acre Martin Gas Sales, Inc. tract, for a distance of 39.68 feet
to the POINT OF BEGINNING of the tract herein described;

THENCE NORTH 44 degrees 28'29" WEST, for a distance of 134.00 feet to a point
for corner;

THENCE NORTH 45 degrees 31'31" EAST, for a distance of 134.00 feet to a point
for corner;

THENCE SOUTH 44 degrees 28'29" EAST, for a distance of 134.00 feet to a point
for corner;

THENCE SOUTH 45 degrees31'31" WEST, for a distance of 134.00 feet to the POINT
OF BEGINNING and containing 0.4122 ACRES, more or less.

SAVE AND EXCEPT TRACT NO. 2:

BEING a 0.7638 acre tract or parcel of land situated in the P.H. Humphrey
League, Abstract No. 32, Jefferson County, Texas and being out of and part of
that certain called 10.6679 acre tract of land as conveyed by Palmera
Properties, Inc. to Martin Gas Sales, Inc., as recorded in Clerk's File No.
98-9814112, Official Public Records of Real Property, Jefferson County, Texas,
said 0.7638 acre tract of land being more particularly described as follows:

        Note:  All bearings are based on the most Southerly portion of the
               Northwesterly line of the said 10.6679 acre Martin Gas Sales,
               Inc. tract as NORTH 19 degrees44'40" EAST as recorded in the
               above referenced deed.

COMMENCING at a 5/8" iron rod found for the most Westerly corner of the said
10.6679 acre Martin Gas Sales, Inc. tract, said corner also being the POINT OF
BEGINNING of the said 10.6679 acre tract as described in the above referenced
deed;



                                      A-2
<PAGE>



THENCE SOUTH 52 degrees 39'42" EAST, along and with the Southwesterly line of
the said 10.6679 acre Martin Gas Sales, Inc. tract, for a distance of 348.52
feet to a point, said point being the most Southerly corner of the said 10.6679
acre Martin Gas Sales, Inc. tract;

THENCE NORTH 45 degrees 31'31" EAST, along and with the Southeasterly line of
the said 10.6679 acre Martin Gas Sales, Inc. tract, for a distance of 273.62
feet to a point;

THENCE NORTH 44 degrees 28'28" WEST, perpendicular to the Southeasterly line of
the said 10.6679 acre Martin Gas Sales, Inc. tract, for a distance of 173.68
feet to a 5/8" iron rod set for corner and the POINT OF BEGINNING of the tract
herein described;

THENCE NORTH 44 degrees 28'29" WEST, for a distance of 101.71 feet to a 5/8"
iron rod set for corner;

THENCE NORTH 05 degrees 38'50" EAST, for a distance of 49.78 feet to a 5/8" iron
rod set for corner;

THENCE NORTH 45 degrees 31'31" EAST, for a distance of 221.41 feet to a 5/8"
iron rod set for corner;

THENCE SOUTH 44 degrees 28'29" EAST, for a distance of 86.45 feet to a 5/8" iron
rod set for corner;

THENCE SOUTH 10 degrees 38'31" EAST, for a distance of 59.22 feet to a 5/8" iron
rod set for corner;

THENCE SOUTH 45 degrees 31'31" WEST, for a distance of 226.64 feet to the POINT
OF BEGINNING and containing 0.7638 ACRES, more or less.

SAVE AND EXCEPT TRACT NO. 3:

BEING a 0.0275 acre tract or parcel of land situated in the he P.H. Humphrey
League, Abstract No. 32, Jefferson County, Texas and being out of and part of
that certain called 10.6679 acre tract of land as conveyed by Palmera
Properties, Inc. to Martin Gas Sales, Inc. as recorded in Clerk's File No.
98-9814112, Official Public Records of Real Property of Jefferson County, Texas,
said 0.0275 acre tract of land being more particularly described as follows:

COMMENCING at a 5/8" iron rod found for the most Westerly corner of the said
10.6679 acre Martin Gas Sales, Inc. tract, said corner also being the POINT OF
BEGINNING of the said 10.6679 acre tract as described in the above referenced
deed;

THENCE South 52 degrees 39' 42" East, along and with the Southwesterly line of
the said 10.6679 acre Martin Gas Sales, Inc. tract, for a distance of 348.52
feet to a point, said point being the most Southerly corner of the said 10.6679
acre Martin Gas Sales, Inc. tract;

THENCE North 45 degrees 31' 31" East, along and with the Southeasterly line of
the said 10.6679 acre Martin Gas Sales, Inc. tract, for a distance of 636.95
feet to a point;

THENCE North 44 degrees 28' 29" West, perpendicular to the Southeasterly line of
the said 10.6679 acre Martin Gas Sales, Inc. tract, for a distance of 288.19
feet to a 5/8" iron rod set for the POINT OF BEGINNING of the tract herein
described;

THENCE North 23 degrees 39' 14" West, for a distance of 44.00 feet to a 5/8"
iron rod set for corner;

THENCE North 65 degrees 57' 58" East, for a distance of 27.13 feet to a 5/8"
iron rod set for corner;



                                      A-3
<PAGE>


THENCE South 23 degrees 51' 08" East, for a distance of 44.19 feet to a "X"
scribed in concrete set for corner;

THENCE South 66 degrees 22' 28" West, for a distance of 27.28 feet to the POINT
OF BEGINNING and containing 0.0275 acres, more or less.

SAVE AND EXCEPT TRACT NO. 4:

BEING a 1.6486 acre tract or parcel of land situated in the P.H. Humphrey
League, Abstract No. 32, Jefferson County, Texas and being out of and part of
that certain called 10.6679 acre tract of land as conveyed by Palmera
Properties, Inc. to Martin Gas Sales, Inc. as recorded in Clerk's File No.
98-9814112, Official Public Records of Real Property of Jefferson County, Texas,
said 1.6486 acre tract of land being more particularly described as follows:

COMMENCING at a 5/8" iron rod found for the most Westerly corner of the said
10.6679 acre Martin Gas Sales, Inc. tract, said corner also being the POINT OF
BEGINNING of the said 10.6679 acre tract as described in the above-referenced
deed;

THENCE South 52 degrees 39' 42" East, along and with the Southwesterly line of
the said 10.6679 acre Martin Gas Sales, Inc. tract, for a distance of 348.52
feet to a point said point being the most Southerly corner of the said 10.6679
acre Martin Gas Sales, Inc. tract;

THENCE North 45 degrees 31' 31" East, along and with the Southeasterly line of
the said 10.6679 acre Martin Gas Sales, Inc. tract, for a distance of 832.40
feet to a point;

THENCE North 44 degrees 28' 29" West, perpendicular to the Southeasterly line of
the said 10.6679 acre Martin Gas Sales, Inc. tract, for a distance of 46.91 feet
to a 5/8" iron rod set for the POINT OF BEGINNING of the tract herein described;

THENCE North 44 degrees 35' 42" West, for a distance of 224.99 feet to a 5/8"
iron rod set for corner;

THENCE North 47 degrees 14' 25" East, for a distance of 251.54 feet to a 5/8"
iron rod set for corner;

THENCE South 87 degrees 00' 50" East, for a distance of 83.91 feet to a 5/8"
iron rod set for corner;

THENCE North 44 degrees 14' 22" East, for a distance of 42.38 feet to a "X"
scribed in concrete set for corner;

THENCE South 43 degrees 16' 43" East, for a distance of 141.35 feet to a 5/8"
iron rod set for corner;

THENCE South 45 degrees 48' 37" West, for a distance of 39.11 feet to a 5/8"
iron rod set for corner;

THENCE South 44 degrees 34' 25" East, for a distance of 14.83 feet to a 5/8"
iron rod set for corner;

THENCE South 45 degrees 24' 30" West, for a distance of 308.02 feet to the POINT
OF BEGINNING and containing 1.6486 acres, more or less;


LEAVING A TOTAL GROSS ACREAGE OF 7.8158 ACRES, MORE OR LESS.


                                      A-4
<PAGE>

                                    EXHIBIT B

                                COMMON USE AREAS

See attached.



                                      B-1
<PAGE>


                                    EXHIBIT C

                                BENEFITED PARCEL


Legal Description:         0.7638 Acre Tract or Parcel of Land
                           P.H. Humphrey League, Abstract No. 32
                           Jefferson County, Texas

BEING a 0.7638 acre tract or parcel of land situated in the P.H. Humphrey
League, Abstract No. 32, Jefferson County, Texas and being out of and part of
that certain called 10.6679 acre tract of land as conveyed by Palmera
Properties, Inc. to Martin Gas Sales, Inc., as recorded in Clerk's File No.
98-9814112, Official Public Records of Real Property, Jefferson County, Texas,
said 0.4122 acre tract of land being more particularly described as follows:

         Note:  All bearings are based on the most Southerly portion of the
                Northwesterly line of the said 10.6679 acre Martin Gas Sales,
                Inc. tract as NORTH 19 degrees44'40" EAST as recorded in the
                above referenced deed.

COMMENCING at a 5/8" iron rod found for the most Westerly corner of the said
10.6679 acre Martin Gas Sales, Inc. tract, said corner also being the POINT OF
BEGINNING of the said 10.6679 acre tract as described in the above referenced
deed;

THENCE SOUTH 52 degrees 39'42" EAST, along and with the Southwesterly line of
the said 10.6679 acre Martin Gas Sales, Inc. tract, for a distance of 348.52
feet to a point, said point being the most Southerly corner of the said 10.6679
acre Martin Gas Sales, Inc. tract;

THENCE NORTH 45 degrees 31'31" EAST, along and with the Southeasterly line of
the said 10.6679 acre Martin Gas Sales, Inc. tract, for a distance of 273.62
feet to a point;

THENCE NORTH 44 degrees 28'28" WEST, perpendicular to the Southeasterly line of
the said 10.6679 acre Martin Gas Sales, Inc. tract, for a distance of 173.68
feet to a 5/8" iron rod set for corner and the POINT OF BEGINNING of the tract
herein described;

THENCE NORTH 44 degrees 28'29" WEST, for a distance of 101.71 feet to a 5/8"
iron rod set for corner;

THENCE NORTH 05 degrees 38'50" EAST, for a distance of 49.78 feet to a 5/8" iron
rod set for corner;

THENCE NORTH 45 degrees 31'31" EAST, for a distance of 221.41 feet to a 5/8"
iron rod set for corner;

THENCE SOUTH 44 degrees 28'29" EAST, for a distance of 86.45 feet to a 5/8" iron
rod set for corner;

THENCE SOUTH 10 degrees 38'31" EAST, for a distance of 59.22 feet to a 5/8" iron
rod set for corner;

THENCE SOUTH 45 degrees 31'31" WEST, for a distance of 226.64 feet to the POINT
OF BEGINNING and containing 0.7638 ACRES, more or less.


                                      C-1

</TEXT>
</DOCUMENT>
</SUBMISSION>
