CREDIT AGREEMENT DATED AS OF JUNE 25, 1996 BETWEEN AND AMONG HERITAGE OPERATING, L.P., A DELAWARE LIMITED PARTNERSHIP

CREDIT AGREEMENT

DATED AS OF JUNE 25, 1996

BETWEEN AND AMONG

HERITAGE OPERATING, L.P.,
A DELAWARE LIMITED PARTNERSHIP

"BORROWER"

AND

THE FIRST NATIONAL BANK OF BOSTON,

AND

BANK OF OKLAHOMA, NATIONAL ASSOCIATION,

"BANKS"

AND

THE FIRST NATIONAL BANK OF BOSTON

AS "ADMINISTRATIVE AGENT" FOR THE BANKS

AND

BANK OF OKLAHOMA, NATIONAL ASSOCIATION

AS "DOCUMENTATION AGENT" FOR THE BANKS
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Page i
TABLE OF CONTENTS

ARTICLE I DEFINITIONS; ACCOUNTING PRINCIPALS,
TERMS AND DEFINITIONS; CONSTRUCTION . . . . . . . . . . . . . . . . . . . . . . . . . 2

1.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.2 Accounting Principles, Terms and Determinations . . . . . . . . . . . . . . . . 28
1.3 Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

ARTICLE II THE CREDITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

2.1 Acquisition Facility. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

2.1.1 Acquisition Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
2.1.2 Maximum Amount of Acquisition Credit . . . . . . . . . . . . . . . . . 29
2.1.3 Acquisition Loan Borrowing Requests . . . . . . . . . . . . . . . . . 29
2.1.4 Acquisition Loan Account: Acquisition Notes . . . . . . . . . . . . . 29

2.2 Working Capital Facility . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

2.2.1 Working Capital Loan . . . . . . . . . . . . . . . . . . . . . . . . . 30
2.2.2 Maximum Amount of Working Capital Credit . . . . . . . . . . . . . . . 30
2.2.3 Working Capital Borrowing Requests . . . . . . . . . . . . . . . . . . 30
2.2.4 Working Capital Loan Account: Working Capital Notes . . . . . . . . . 31

2.3 Letters of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

2.3.1 Issuance of Letters of Credit . . . . . . . . . . . . . . . . . . . . 31
2.3.2 Requests for Letters of Credit . . . . . . . . . . . . . . . . . . . . 31
2.3.3 Form and Expiration of Letters of Credit . . . . . . . . . . . . . . . 32
2.3.4 Banks' Participation in Letters of Credit . . . . . . . . . . . . . . 32
2.3.5 Presentation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
2.3.6 Payment of Drafts . . . . . . . . . . . . . . . . . . . . . . . . . . 32
2.3.7 Uniform Customs and Practice . . . . . . . . . . . . . . . . . . . . . 33
2.3.8 Subrogation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
2.3.9 Modification, Consent, etc. . . . . . . . . . . . . . . . . . . . . . 34

2.4 Application of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

2.4.1 Acquisition Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
2.4.2 Working Capital Loan . . . . . . . . . . . . . . . . . . . . . . . . . 35
2.4.3 Letters of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . 35
2.4.4 Specifically Prohibited Applications . . . . . . . . . . . . . . . . . 35

2.5 Nature of Obligations of Banks to Make Extensions of Credit . . . . . . . . . . 35

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ARTICLE III INTEREST; EURODOLLAR PRICING OPTIONS; FEES . . . . . . . . . . . . . . . . . . . . . . 35

3.1 Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
3.2 Eurodollar Pricing Options. . . . . . . . . . . . . . . . . . . . . . . . . . . 36

3.2.1 Election of Eurodollar Pricing Options. . . . . . . . . . . . . . . . 36
3.2.2 Notice to Banks and Borrower . . . . . . . . . . . . . . . . . . . . . 36
3.2.3 Selection of Eurodollar Interest Periods . . . . . . . . . . . . . . . 37
3.2.4 Additional Interest . . . . . . . . . . . . . . . . . . . . . . . . . 37
3.2.5 Violation of Bank Legal Requirements . . . . . . . . . . . . . . . . 37
3.2.6 Funding Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . 38

3.3 Commitment Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

3.3.1 Acquisition Financing Facility . . . . . . . . . . . . . . . . . . . . 38
3.3.2 Working Capital Facility . . . . . . . . . . . . . . . . . . . . . . . 38

3.4 Letter of Credit Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
3.5 Reserve Requirements, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . 39
3.6 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
3.7 Capital Adequacy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
3.8 Regulatory Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
3.9 Computations of Interest and Fees . . . . . . . . . . . . . . . . . . . . . . . 41
3.10 Closing Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
3.11 Administrative Agent's Fees . . . . . . . . . . . . . . . . . . . . . . . . . . 41
3.12 Documentation Agent's Fees . . . . . . . . . . . . . . . . . . . . . . . . . . 41

ARTICLE IV PAYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

4.1 Payment at Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
4.2 Contingent Required Prepayments . . . . . . . . . . . . . . . . . . . . . . . . 42

4.2.1 Excess Credit Exposure . . . . . . . . . . . . . . . . . . . . . . . . 42
4.2.2 Letter of Credit Exposure . . . . . . . . . . . . . . . . . . . . . . 42
4.2.3 Contingent Prepayments on Disposition, Loss of Assets,
Merger or Change of Control . . . . . . . . . . . . . . . . . . . . . 42
4.2.4 Prepayment Procedure for Contingent Prepayments . . . . . . . . . . . 43

4.3 Scheduled Required Payments/Prepayments . . . . . . . . . . . . . . . . . . . . 43

4.3.1 Payments on the Acquisition Loan . . . . . . . . . . . . . . . . . . . 43
4.3.2 Working Capital Loan . . . . . . . . . . . . . . . . . . . . . . . . . 44

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4.4 Voluntary Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
4.5 Letters of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
4.6 Reborrowing Application of Payments, etc. . . . . . . . . . . . . . . . . . . . 44

4.6.1 Reborrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
4.6.2 Order of Application . . . . . . . . . . . . . . . . . . . . . . . . . 45
4.6.3 Payment with Accrued Interest, etc. . . . . . . . . . . . . . . . . . 45
4.6.4 Payments for Banks . . . . . . . . . . . . . . . . . . . . . . . . . . 45

ARTICLE V SECURITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

5.1 Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
5.2 Intercreditor Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

ARTICLE VI CONDITIONS PRECEDENT AND SUBSEQUENT TO LOANS . . . . . . . . . . . . . . . . . . . . . 46

6.1 Conditions Precedent to Initial Working Capital Loan
and Initial Acquisition Loan . . . . . . . . . . . . . . . . . . . . . . . . . 46

(i) No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
(ii) Representations and Warranties . . . . . . . . . . . . . . . . . . . . 46
(iii) Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
(iv) Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
(v) Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
(vi) Security Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . 47
(vii) Private Placement Notes and Common Units Closings . . . . . . . . . . . 47
(viii) Opinions of Borrower's Counsel . . . . . . . . . . . . . . . . . . . . 47
(ix) UCC Releases/Other Information . . . . . . . . . . . . . . . . . . . . 47
(x) Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
(xi) Other Information and Closing Documents . . . . . . . . . . . . . . . . 48

6.2 Conditions Precedent to All Loans. . . . . . . . . . . . . . . . . . . . . . . 48

ARTICLE VII COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

7A. Affirmative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

7A.1 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . 48
7A.2 Inspection of Property . . . . . . . . . . . . . . . . . . . . . . . . 52
7A.3 Covenant to Secure Notes Equally . . . . . . . . . . . . . . . . . . . 52
7A.4 Partnership or Corporate Existence, etc.; Compliance
with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
7A.5 Payment of Taxes and Claims . . . . . . . . . . . . . . . . . . . . . . 53

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7A.6 Compliance with ERISA . . . . . . . . . . . . . . . . . . . . . . . . . 53
7A.7 Maintenance and Sufficiency of Properties . . . . . . . . . . . . . . . 53
7A.8 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
7A.9 Environmental Laws . . . . . . . . . . . . . . . . . . . . . . . . . . 54
7A.10 Operative Agreements . . . . . . . . . . . . . . . . . . . . . . . . . 55
7A.11 After-Acquired Property . . . . . . . . . . . . . . . . . . . . . . . . 55
7A.12 Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . 55
7A.13 Books and Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . 55
7A.14 Available Cash Reserves . . . . . . . . . . . . . . . . . . . . . . . . 55
7A.15 Parity Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56

7B. Negative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57

7B.1 Financial Ratios . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
7B.2 Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
7B.3 Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
7B.4 Priority Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
7B.5 Loans, Advances, Investments and Contingent Liabilities . . . . . . . . 62
7B.6 Restricted Payments . . . . . . . . . . . . . . . . . . . . . . . . . . 64
7B.7 Consolidation, Merger, Sale of Assets, etc. . . . . . . . . . . . . . . 64
7B.8 Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
7B.9 Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . 67
7B.10 Subsidiary Stock and Indebtedness . . . . . . . . . . . . . . . . . . . 67
7B.11 Payment of Dividends by Subsidiaries . . . . . . . . . . . . . . . . . 68
7B.12 Sales of Receivables . . . . . . . . . . . . . . . . . . . . . . . . . 68
7B.13 Material Agreements; Tax Status . . . . . . . . . . . . . . . . . . . . 68

ARTICLE VIII REPRESENTATIONS, COVENANTS AND
WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69

8.1 Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
8.2 Partnership Interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
8.3 Qualification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
8.4 Business; Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . 70
8.5 Actions Pending . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
8.6 Changes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
8.7 Outstanding Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
8.8 Transfer of Assets and Business; Title to Properties . . . . . . . . . . . . . 71
8.9 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
8.10 Compliance with Other Instruments, etc.; Solvency . . . . . . . . . . . . . . . 72
8.11 Governmental Consent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
8.12 Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
8.13 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
8.14 Environmental Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
8.15 Pre-emptive Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
8.16 Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
8.17 Federal Reserve Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . 75
8.18 Investment Borrower Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
8.19 Public Utility Holding Company Act . . . . . . . . . . . . . . . . . . . . . . 76
8.20 Matters Relating to the General Partner . . . . . . . . . . . . . . . . . . . . 76

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ARTICLE IX EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76

9.1 Acceleration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
9.2 Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
9.3 Other Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79

ARTICLE X LOAN OPERATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80

10.1 Interests in Loans/Commitments . . . . . . . . . . . . . . . . . . . . . . . . 80
10.2 Administrative Agent's Authority to Act . . . . . . . . . . . . . . . . . . . . 80
10.3 Borrower to Pay Administrative Agent . . . . . . . . . . . . . . . . . . . . . 80
10.4 Bank Operations for Advances, Letters of Credit . . . . . . . . . . . . . . . . 80

10.4.1 Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
10.4.2 Letters of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
10.4.3 Administrative Agent to Allocate Payments . . . . . . . . . . . . . . . 81
10.4.4 Delinquent Banks; Nonperforming Banks . . . . . . . . . . . . . . . . . 82

10.5 Sharing of Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
10.6 Amendments, Consents, Waivers . . . . . . . . . . . . . . . . . . . . . . . . . 83
10.7 Administrative Agent's Resignation . . . . . . . . . . . . . . . . . . . . . . 84
10.8 Concerning the Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84

10.8.1 Action in Good Faith . . . . . . . . . . . . . . . . . . . . . . . . . 84
10.8.2 No Implied Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
10.8.3 Validity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
10.8.4 Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
10.8.5 Employment Agents and Counsel . . . . . . . . . . . . . . . . . . . . . 85
10.8.6 Reliance on Documents and Counsel . . . . . . . . . . . . . . . . . . . 86
10.8.7 Agents' Reimbursement . . . . . . . . . . . . . . . . . . . . . . . . . 86
10.8.8 Agent's Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86

10.9 Rights as a Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
10.10 Independent Credit Decision . . . . . . . . . . . . . . . . . . . . . . . . . . 86
10.11 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87

ARTICLE XI ASSIGNMENTS/PARTICIPATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87

11. Successors and Assigns; Bank Assignment and Participations . . . . . . . . . . . . . . . 87

11.1 Assignments by Banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87

11.1.1 Assignees and Assignment Procedures. . . . . . . . . . . . . . . . . . 88

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11.1.2 Terms of Assignment and Acceptance. . . . . . . . . . . . . . . . . . . 89
11.1.3 Register . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
11.1.4 Acceptance of Assignment and Assumption . . . . . . . . . . . . . . . . 90
11.1.5 Federal Reserve Bank . . . . . . . . . . . . . . . . . . . . . . . . . 90
11.1.6 Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . 90

11.2 Credit Participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
11.3 Replacement of Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
11.4 Sale of a Certain Participation . . . . . . . . . . . . . . . . . . . . . . . . 92

ARTICLE XII MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92

12.1 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
12.2 Place of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
12.3 Survival of Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
12.4 Parties in Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
12.5 Governing Law and Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . 94
12.6 SUBMISSION TO JURISDICTION . . . . . . . . . . . . . . . . . . . . . . . . . . 94
12.7 Maximum Interest Rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
12.8 No Waiver; Cumulative Remedies . . . . . . . . . . . . . . . . . . . . . . . . 94
12.9 Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
12.10 WAIVER OF JURY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
12.11 Full Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
12.12 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
12.13 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
12.14 Exceptions to Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
12.15 Conflict with Security Documents . . . . . . . . . . . . . . . . . . . . . . . 96
12.16 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
12.17 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96

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CREDIT AGREEMENT

THIS CREDIT AGREEMENT, dated as of June 25, 1996 (this "Agreement"),
is entered into between and among HERITAGE OPERATING, L.P., a Delaware limited
partnership (the "Borrower") and THE FIRST NATIONAL BANK OF BOSTON ("Bank of
Boston") and BANK OF OKLAHOMA, NATIONAL ASSOCIATION ("BOk") (Bank of Boston and
BOk, together with each other Person that becomes a Bank pursuant to Section 11
collectively referred to herein as the "Banks"), Bank of Boston, as
administrative and structuring agent for the Banks (in such capacity the
"Administrative Agent") and BOk, as documentation agent for the Banks (in such
capacity, the "Documentation Agent").

ARTICLE I

DEFINITIONS; ACCOUNTING PRINCIPALS,
TERMS AND DEFINITIONS; CONSTRUCTION

1.1 Definitions. Capitalized terms are used in this Agreement
with the specific meanings defined below in this Section 1.

"Acquired Debt" means with respect to any specified Person, (i)
Indebtedness of any other Person existing at the time such other Person merged
with or into or became a Subsidiary of such specified Person, including
Indebtedness incurred in connection with, or in contemplation of, such other
Person merging with or into or becoming a Subsidiary of such specified Person
and (ii) Indebtedness encumbering any asset acquired by such specified Person.

"Acquisition Conversion Date" is defined in Section 2.1.1.

"Acquisition/Capex Due Diligence Package" is defined in Section 2.1.3.

"Acquisition Facility" means the agreement of the Banks herein to make
the Acquisition Loan.

"Acquisition Loan Account" is defined in Section 2.1.4.

"Acquisition Loan" is defined in Section 2.1.4.

"Acquisition Notes" is defined in Section 2.1.4.

"Additional Parity Debt" means Indebtedness of the Borrower that is
incurred with the consent of the Requisite Percentage of the Banks and that
constitutes "Additional Parity Debt" as defined in the Note Purchase Agreement
and the Intercreditor Agreement.
9
"Administrative Agent" means Bank of Boston in its capacity as
administrative and structuring agent for the Banks hereunder, as well as its
successors and assigns in such capacity pursuant to Section 10.7.

"Administrative Agent Fee Letter" is defined in Section 3.11.

"Affected Bank" is defined in Section 11.3.

"Affiliate" means, with respect to any Person any other Person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with, such Person, except a Subsidiary of such Person. A
Person shall be deemed to control a corporation if such Person (i) possesses,
directly or indirectly, the power to direct or cause the direction of the
management and policies of such corporation, whether through the ownership of
voting securities, by contract or otherwise or (ii) owns at least 5% of the
Voting Stock of a corporation. As applied to the Borrower, "Affiliate"
includes the General Partner and the Master Partnership.

"Agents" means collectively the Administrative Agent and the
Documentation Agent.

"Agreement" means this Agreement as from time to time amended,
modified and in effect.

"Allocable Proceeds" means, with respect to Excess Sale Proceeds or
Excess Taking Proceeds, as the case may be, to be applied on any date pursuant
to Sections 4.2.3(i) and 4.2.3(ii), the principal amount thereof available to
prepay the Acquisition Notes determined by allocating such Excess Sale Proceeds
or Excess Taking Proceeds, as the case may be, pro rata among the holders of
all Acquisition Notes, the Private Placement Notes and other Parity Debt (other
than Indebtedness permitted by Section 7B.2(ii)), if any, according to the
aggregate principal amounts of the Acquisition Notes, the Private Placement
Notes and such other Parity Debt outstanding on the date the applicable
prepayment is to be made in accordance with Sections 4.2.3(i) and 4.2.3(ii).

"Annual Clean-Up" is defined in Section 2.2.2.

"Applicable Commitment Fee Percentage" means, with respect to any
Margin Period, the applicable percentage set forth below:

(i) during the period from the Closing Date to the Financial
Statement Delivery Date for the fiscal quarter ending August 31, 1996, .50%;
and

(ii) thereafter, if the Leverage Ratio on the Financial Statement
Delivery Date beginning such Margin Period was equal to or greater than 3.75 to
1, .50% or if the Leverage Ratio on the Financial Statement Delivery Date
beginning such Margin Period was less than 3.75 to 1, .375%.

Notwithstanding the foregoing, if any of the financial statements
required pursuant to Section 7A.1(i) are not delivered within the time periods
specified in Section 7A.1(i), the Applicable Commitment Fee Percentage shall be
.50% until the date such statements are delivered.

-3-
10
"Applicable Margin". With respect to any Eurodollar Loan or with
respect to any Base Rate Loan, the rate of interest per annum determined as set
forth below:

(a) during the initial Margin Period from the Closing Date to the
Financial Statement Delivery Date for the fiscal quarter of the Borrower ending
August 31, 1996, the Applicable Margin will be 2.125% for Eurodollar Loans and
.50% for Base Rate Loans; and

(b) for any Margin Period thereafter,

(i) if the Leverage Ratio on the Financial Statement
Delivery Date commencing such Margin Period was less than 3.75 to 1,
the Applicable Margin will be 1.25% for Eurodollar Loans and zero for
Base Rate Loans;

(ii) if the Leverage Ratio on the Financial Statement
Delivery Date commencing such Margin Period was equal to or greater
than 3.75 to 1 but less than 4.00 to 1, the Applicable Margin will be
1.375% for Eurodollar Loans and zero for Base Rate Loans;

(iii) if the Leverage Ratio on the Financial Statement
Delivery Date commencing such Margin Period was equal to or greater
than 4.00 to 1 but less than 4.50 to 1, the Applicable Margin will be
1.625% of for Eurodollar Loans and .25% for Base Rate Loans;

(iv) if the Leverage Ratio on the Financial Statement
Delivery Date commencing such Margin Period was equal to or greater
than 4.50 to 1 but less than 4.75 to 1, the Applicable Margin will be
1.875% for Eurodollar Loans and .375% for Base Rate Loans; and

(v) if the Leverage Ratio on the Financial Statement
Delivery Date commencing such Margin Period was equal to or greater
than 4.75 to 1, the Applicable Margin will be 2.125% for Eurodollar
Loans and .50% for Base Rate Loans.

Notwithstanding the foregoing, if any of the financial statements
required pursuant to Section 7A.1(i) are not delivered within the time periods
specified in Section 7A.1(i), the Applicable Margin shall be the Applicable
Margin set forth in clause (i) above until the date such statements are
delivered.

"Applicable Rate" means, at any date, the sum of:

(i) (a) with respect to each Eurodollar Loan, the sum of the
Applicable Margin in effect on such date plus the Eurodollar Rate relating to
such Eurodollar Loan;

(b) with respect to each Base Rate Loan, the sum of the
Applicable Margin in effect on such date plus the Base Rate; and

(ii) an additional two percentage points (2%) effective on the day
the Administrative Agent notifies the Borrower that the interest rates
hereunder are increasing as a result of the

-4-
11
occurrence and continuance of an Event of Default until such time as (A) such
Event of Default is no longer continuing or (B) such Event of Default is deemed
no longer to exist, in each case pursuant to Section 9.3.

"Asset Acquisition" means (i) an Investment by the Borrower or any
Subsidiary of the Borrower in any other Person pursuant to which such Person
shall become a Subsidiary of the Borrower or shall be merged with or into the
Borrower or any Subsidiary of the Borrower, (ii) the acquisition by the
Borrower or any Subsidiary of the Borrower of the assets of any Person which
constitute all or substantially all of the assets of such Person or (iii) the
acquisition by the Borrower or any Subsidiary of the Borrower of any division
or line of business of any Person (other than a Subsidiary of the Borrower).

"Asset Sale" is defined in Section 7B.7(iii).

"Assets" is defined in the second opening paragraph of the Note
Purchase Agreement, as in effect on the date hereof.

"Assignment" is defined in Section 11.1.1.

"Assignment and Acceptance" is defined in Section 11.1.1.

"Attributable Debt" means, with respect to any Sale and Lease-Back
Transaction not involving a Capitalized Lease Obligation, as of any date of
determination, the total obligation (discounted to present value at the rate of
interest implicit in the lease included in such transaction) of the lessee for
rental payments (other than accounts required to be paid on account of property
taxes, maintenance, repairs, insurance, assessments, utilities, operating and
labor costs and other items which do not constitute payments for property
rights) during the remaining portion of the term (including extensions which
are at the sole option of the lessor) of the lease included in such transaction
(in the case of any lease which is terminable by the lessee upon the payment of
a penalty, such rental obligation shall also include the amount of such
penalty, but no rent shall be considered as required to be paid under such
lease subsequent to the first date upon which it may be so terminated).

"Available Cash" means, with respect to any fiscal quarter of the
Borrower: (i) the sum of (a) all cash and cash equivalents of the Borrower and
its Subsidiaries on hand at the end of such quarter and (b) all additional cash
and cash equivalents of the Borrower and its Subsidiaries on hand on the date
of determination of Available Cash with respect to such quarter resulting from
borrowings for working capital purposes made subsequent to the end of such
quarter, less (ii) the amount of any cash reserves that is necessary or
appropriate in the reasonable discretion of the General Partner to (a) provide
for the proper conduct of the business of the Borrower and its Subsidiaries
(including reserves for future capital expenditures) subsequent to such
quarter, (b) comply with applicable law or any loan agreement, security
agreement, mortgage, debt instrument or other agreement or obligation to which
the Borrower or any Subsidiary is a party or by which it is bound or its assets
are subject (including the Loan Documents) and (c) provide funds for

-5-
12
distributions to partners of the Master Partnership and the General Partner in
respect of any one or more of the next four quarters; provided that the General
Partner need not establish cash reserves pursuant to clause (c) if the effect
of such reserves would be that the Master Partnership is unable to distribute
the Minimum Quarterly Distribution (as defined in the Agreement of Limited
Partnership of the Master Partnership) on all Common Units with respect to such
quarter; and provided, further, that disbursements made by the Borrower or a
Subsidiary of the Borrower 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. In addition, without
limiting the foregoing, Available Cash for any fiscal quarter shall reflect
reserves equal to (A) 50% of the interest projected to be paid on the Private
Placement Notes in the next succeeding fiscal quarter plus (B) beginning with a
date three fiscal quarters before a scheduled principal payment date on the
Private Placement Notes, 25% of the aggregate principal amount thereof due on
any such payment date in the third succeeding fiscal quarter, 50% of the
aggregate principal amount due on any such payment date in the second
succeeding fiscal quarter and 75% of the aggregate principal amount due on any
quarterly payment date in the next succeeding fiscal quarter, plus (C) the
Unused Proceeds Reserve as of the date of determination, provided that the
foregoing reserves for amounts to be paid on the Private Placement Notes shall
be reduced by the aggregate amount of advances available to the Borrower from
responsible financial institutions under binding irrevocable (x) credit or
financing commitments (which are subject to no conditions which the Borrower is
unable to meet) including this Agreement and (y) letters of credit (which are
subject to no conditions which the Borrower is unable to meet) in each case to
be used to refinance such amounts, to the extent such amounts could be borrowed
and remain outstanding under Sections 7B.2 and 7B.1.

"Bank" means each of the Persons listed as Banks on the signature page
hereto, including each of Bank of Boston and BOk in its capacity as a Bank and
such other Persons who may from time to time own a Percentage Interest in the
Credit Obligations, but the term "Bank" shall not include any Credit
Participant.

-6-
13
"Bank of Boston" has the meaning specified in the introduction to this
Agreement.

"BOk" has the meaning specified in the introduction to this Agreement.

"Bank Legal Requirement" means any present or future requirement
imposed upon any of the Banks or the Borrower and its Subsidiaries by any law,
statute, rule, regulation, directive, order, decree, guideline (or any
interpretation thereof by courts or of administrative bodies) of the United
States of America, or any jurisdiction in which any Eurodollar Office is
located or any state or political subdivision of any of the foregoing, or by
any board, governmental or administrative agency, central bank or monetary
authority of the United States of America, any jurisdiction in which any
Eurodollar Office is located, or any political subdivision of any of the
foregoing. any such requirement imposed on any of the Banks not having the
force of law shall be deemed to be a Bank Legal Requirement if such Bank
reasonably believes that compliance therewith is in the best interest of such
Bank.

"Banking Day" means any day other than Saturday, Sunday or a day on
which banks in Boston, Massachusetts or Tulsa, Oklahoma are authorized or
required by law or other governmental action to close and, if such term is used
with reference to a Eurodollar Pricing Option, any day on which dealings are
effected in the Eurodollars in question by first-class banks in the inter-bank
Eurodollar markets in New York, New York.

"Bankruptcy Law" is defined in clause (viii) of Section 9.1.

"Base Rate" means, on any date, the greater (i) the rate of interest
announced by Bank of Boston at the Boston Office as its Base Rate or (ii) the
sum of 1/2% plus the Federal Funds Rate.

"Base Rate Loan" means each portion of the Loan bearing interest
determined by reference to the Base Rate.

"Bi-State" means Heritage-Bi State Corp. a Delaware corporation.

"Boston Office" means the principal banking office of Bank of Boston
in Boston, Massachusetts.

"Business" means the wholesale and retail sale, storage and
distribution of propane gas, providing repair, installation and maintenance
services for propane heating systems and the sale and distribution of propane -
related supplies and equipment, including appliances.

"Capital Stock" means, with respect to any Person, any and all shares,
units representing interests, participations, rights in or other equivalents
(however designated) of such Person's capital stock, including, with respect to
partnerships, partnership interests (whether general or limited) and any other
interest or participation that confers upon a Person the right to receive a
share of the profits and losses of, or distributions of assets of, such
partnership, and any rights (other than debt securities

-7-
14
convertible into capital stock), warrants or options exchangeable for or
convertible into such capital stock.

"Capitalized Lease Obligation" means any rental obligation which under
GAAP would be required to be capitalized on the books of the Borrower or any of
its Subsidiaries, taken at the amount thereof accounted for as indebtedness
(net of interest expense) in accordance with such principles.

"Cash Equivalents" is defined in Section 7B.5(iii).

"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42 U.S.C. Section 9601 et seq., as
the same may be amended from time to time.

"Certificates and Stock Powers" is defined in Section 6.1(vi).

"Change of Control" means the acquisition by any Person or group of
related persons (as such terms are defined in the Exchange Act) (other than the
Current Management or group of related persons (as so defined) including the
Current Management) of beneficial ownership of more than 50% of the Units.

"Closing Date" means the Initial Closing Date, the Acquisition
Conversion Date and each other date on which any extension of credit is made
pursuant to Section 2.1, 2.2 or 2.3.

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

"Collateral" is defined in the Security Agreement, provided, however,
that Collateral shall not include for any purpose under this Agreement or any
other Loan Document any property subject to a Lien incurred pursuant to clause
(i), (vii) or (viii) of Section 7B.3 or any renewals of any such Lien pursuant
to clause (xiv) of Section 7B.3 unless the Indebtedness secured by such Lien
shall have been paid or discharged.

"Collateral Agent" shall mean Wilmington Trust Company, a Delaware
trust company, in its capacity as collateral agent under the Intercreditor and
Agency Agreement and its successors and assigns in such capacity under Section
11 thereof.

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

"Commitments" means, with respect to any Bank, such Bank's obligations
to extend the credit facilities contemplated by Section 2. The original
Commitments are set forth in Section 10.1 and the current Commitments are
recorded from time to time in the Register.

"Common Units" is defined in the second opening paragraph of the Note
Purchase Agreement in effect on the date hereof.

-8-
15
"Consolidated Debt Service" means, as of any date of determination,
the total amount payable by the Borrower and its Subsidiaries on a consolidated
basis during the four consecutive calendar quarters next succeeding the date of
determination, in respect of scheduled principal and interest payments with
respect to Indebtedness of the Borrower and its Subsidiaries outstanding on
such date of determination, after giving effect to any Indebtedness proposed on
such date to be incurred and to the substantially concurrent repayment of any
other Indebtedness (a) including actual payments under Capitalized Lease
Obligations, (b) assuming, in the case of Indebtedness (other than Indebtedness
referred to in clause (c) below) bearing interest at fluctuating interest rates
which cannot be determined in advance, that the rate actually in effect on such
date will remain in effect throughout such period, (c) including only actual
interest (but not principal) payments associated with the Indebtedness incurred
pursuant to Section 7B.2(ii) and 7B.2(v) during the most recent four
consecutive calendar quarters and (d) treating the principal amount of all
Indebtedness outstanding as of such date of determination under a revolving
credit or similar agreement (other than the Indebtedness incurred pursuant to
Section 7B.2(ii) and Section 7B.2(v)) as maturing and becoming due and payable
on the scheduled maturity date or dates thereof (including the maturity of any
payment required by any commitment reduction or similar amortization
provision), without regard to any provision permitting such maturity date to be
extended (except for such extensions as may be made in the sole discretion of
the borrower thereunder and without any conditions that remain to be fulfilled
by the borrower or waived by the lender thereunder). See Section 1.2(i).

"Consolidated EBITDA" means, as of any date of determination for any
applicable period, (1) the sum of, without duplication, the amounts for such
period, taken as a single accounting period, of (a) Consolidated Net Income and
(b) to the extent deducted in the determination of Consolidated Net Income,
after excluding amounts attributable to minority interests in Subsidiaries and
without duplication, (i) Consolidated Non-Cash Charges, (ii) Consolidated
Interest Expense and (iii) Consolidated Income Tax Expense less (2) any
non-cash items increasing Consolidated Net Income for such period to the extent
that such items constitute reversals of a Consolidated Non-Cash Charge for a
previous period and which were included in the computation of Consolidated
EBITDA for such previous period pursuant to the provisions of the preceding
clause (1). Consolidated EBITDA shall be calculated after giving effect, on a
pro forma basis and in accordance with GAAP, to, without duplication, any Asset
Sales or Asset Acquisitions (including without limitation any Asset Acquisition
giving rise to the need to make such calculation as a result of the Borrower or
one of its Subsidiaries incurring, assuming or otherwise being liable for
Acquired Debt) occurring during the period commencing on the first day of such
period to and including the date of the transaction (the "Reference Period"),
as if such Asset Sale or Asset Acquisition occurred on the first day of the
Reference Period; provided, however, that Consolidated EBITDA generated by an
acquired business or asset shall be determined by the actual gross profit
(revenues minus cost of goods sold) of such acquired business or asset during
the immediately preceding four full fiscal quarters in the Reference Period
minus the pro forma expenses that would have been incurred by the Borrower and
its Subsidiaries in the operation of such acquired business or asset during
such period computed on the basis of personnel expenses for employees retained
or to be retained by the Borrower and its Subsidiaries in the operation of such
acquired business or asset and non-personnel costs and expenses incurred by
the Borrower and its Subsidiaries in the operation of the Borrower's business
at similarly situated facilities of the Borrower or any of its Subsidiaries (as
determined in good faith

-9-
16
by the General Partner determined (a) on the basis of 100% that amount for the
period of upon reasonable assumptions). As used herein, but only for purposes
of Sections 7B.1(i) and (ii), Consolidated EBITDA shall be determined (a) on
the basis of 100% of that amount for the period of the four most recent fiscal
quarters ending on or prior to the date of determination or (b) 50% of that
amount for the period of the eight most recent fiscal quarters ending on or
prior to the date of determination, whichever is higher. For all other
purposes hereof, Consolidated EBITDA shall be based upon that amount determined
over the four most recent fiscal quarters ending on or prior to the date of
determination (or, as the case may be, for which financial statements have been
or are required to be delivered to the Banks pursuant to Section 7B.1(i) and
(ii)). See Section 1.2(i).

"Consolidated Funded Indebtedness" means, as of any date of
determination, the aggregate amount of Indebtedness of the Borrower and its
Subsidiaries outstanding on that date and maturing in more than 12 months,
including the Private Placement Notes and borrowings under the Acquisition
Facility (including current maturities of any such Indebtedness).
Notwithstanding anything to the contrary contained herein, Consolidated Funded
Indebtedness shall not include borrowings under the Working Capital Facility to
the extent permitted under the Note Purchase Agreement.

"Consolidated Income Tax Expense" means, with respect to the Borrower
and its Subsidiaries, for any period, the provision for federal, state, local
and foreign income taxes of the Borrower and its Subsidiaries for such period
as determined on a consolidated basis in accordance with GAAP. See Section
1.2(i).

"Consolidated Interest Expense" means as of any date of determination
for any applicable period, without duplication, the sum of (i) the interest
expense of the Borrower and its Subsidiaries for such period as determined on a
consolidated basis in accordance with GAAP, including without limitation (a)
any amortization of debt discount, (b) the net cost under Interest Rate
Agreements, (c) the interest portion of any deferred payment obligation, (d)
all commissions, discounts and other fees and charges owed with respect to
letters of credit and bankers' acceptance financing and (e) all accrued
interest and (ii) the interest component of Capitalized Lease Obligations paid,
accrued or scheduled to be paid or accrued by the Borrower and its Subsidiaries
during such period as determined on a consolidated basis in accordance with
GAAP. In computing Consolidated Interest Expense for any period prior to the
end of the first four fiscal quarters ending after the Closing Date,
Consolidated Interest Expense of the Borrower and its Subsidiaries shall be
determined on the basis of interest accruing at a rate equal to the average
interest rate payable on the date of determination with respect to Indebtedness
outstanding from time to time under the Notes, the Acquisition Facility and the
Working Capital Facility, rather than the rates of interest applicable to the
interest expense of the Indebtedness refinanced thereby. In computing
Consolidated Interest Expense for purposes of clause (ii) of Section 7B.1, the
applicable period for the determination thereof shall be the four most recent
fiscal quarters ending on or prior to the date of determination. See Section
1.2(i).

"Consolidated Net Income" means the net income of the Borrower and its
Subsidiaries, as determined on a consolidated basis in accordance with GAAP and
after provision for minority interests and as adjusted to exclude (i) net
after-tax extraordinary gains or losses, (ii) net after-tax

-10-
17
gains or losses attributable to Asset Sales, (iii) the net income or loss of
any Person which is not a Subsidiary of the Borrower and which is accounted
for by the equity method of accounting, provided that Consolidated Net Income
shall include the amount of cash dividends or distributions actually paid to
the Borrower or any Subsidiary of the Borrower, (iv) the net income or loss
prior to the date of acquisition of any Person combined with the Borrower or
any Subsidiary of the Borrower in a pooling of interest, (v) the net income of
any Subsidiary of the Borrower to the extent that dividends or distributions
of such net income are not at the date of determination permitted by the terms
of its charter or any agreement, instrument, judgment, decree, order, statute,
rule or other regulation and (vi) the cumulative effect of any changes in
accounting principles. See Section 1.2(i).

"Consolidated Net Tangible Assets" means, as of any date of
determination, the Total Assets of the Borrower and its Subsidiaries, minus the
net book value of all assets of the Borrower and its Subsidiaries (after
deducting any reserves applicable thereto) which would be shown as intangible
assets on a consolidated balance sheet of the Borrower and its Subsidiaries as
of such time prepared in accordance with GAAP. See Section 1.2(i).

"Consolidated Net Worth" means, with respect to any Person, at any
date of determination, the total partners' capital (in the case of a
partnership) or stockholders' equity (in the case of a corporation) of such
Person at such date, as would be shown on a consolidated balance sheet of such
Person and its Subsidiaries, if any, prepared in accordance with GAAP. See
Section 1.2(i).

"Consolidated Non-Cash Charges" means with respect to the Borrower and
its Subsidiaries, for any period, the aggregate depreciation and amortization,
in each case reducing Consolidated Net Income of the Borrower and its
Subsidiaries for such period, determined on a consolidated basis in accordance
with GAAP. See Section 1.2(i).

"Consolidated Pro Forma Maximum Debt Service" means, as of any date of
determination, the maximum amount payable by the Borrower and its Subsidiaries
on a consolidated basis during all periods of four consecutive calendar
quarters, commencing with the calendar quarter in which such date of
determination occurs and ending June 30, 2011, in respect of scheduled
principal and interest payments with respect to all Indebtedness of the
Borrower and its Subsidiaries outstanding on such date of determination, after
giving effect to any Indebtedness proposed on such date to be incurred and to
the substantially concurrent repayment of any other Indebtedness (a) including
all payments under Capitalized Lease Obligations, (b) assuming, in the case of
Indebtedness (other than Indebtedness referred to in clause (c) below) bearing
interest at fluctuating interest rates which cannot be determined in advance,
that the rate actually in effect on such date will remain in effect throughout
such period, (c) including only actual interest (but not principal) payments
associated with the Indebtedness incurred pursuant to Section 6B(ii) during the
most recent four consecutive calendar quarters and (d) treating the principal
amount of all Indebtedness outstanding as of such date of determination under a
revolving credit or similar agreement (other than the Indebtedness incurred
pursuant to Section 6B(ii)) as maturing and becoming due and payable on the
scheduled maturity date or dates thereof (including the maturity of any payment
required by any commitment reduction or similar amortization provision),
without regard to any provision permitting such maturity date to be extended
(except for such extensions as may be made in the sole discretion of

-11-
18
the borrower thereunder and without any conditions that remain to be fulfilled
by the borrower or waived by the lender thereunder). See Section 1.2(i).

"Consolidated Tangible Net Worth" means, with respect to any Person,
at any date of determination, the then Consolidated Net Worth of Person minus
the net book value of all assets of such Person and its Subsidiaries, if any,
(after deducting any reserves applicable thereto), which would be shown as
intangible assets on a consolidated balance sheet of such Person and its
Subsidiaries, if any, as of such time prepared in accordance with GAAP. See
Section 1.2(i).

"Contribution Agreement" shall mean the Contribution, Conveyance and
Assumption Agreement, dated as of June 28, 1996, among Heritage, the Borrower
and the other signatories thereto, as the same may from time to time be
amended, supplemented or otherwise modified in accordance with the terms
thereof and hereof.

"Control Event" means:

(i) the execution of any written agreement to which the
Borrower or any Affiliate of the Borrower is a party which could reasonably be
expected to result in a Change of Control.

(ii) the commencement (as such term is used in Rule
14d-2(a) under the Exchange Act as in effect on the date of the Closing) of a
tender offer by any person (as such term is used in Section 13(d) and Section
14(d)(2) of the Exchange Act as in effect on the date of the Closing) or
related person constituting a group (as such term issued in Rule 13d-5 under
the Exchange Act as in effect on the date of the Closing) for units which would
result in such person or group owning, directly or indirectly, more than 50% of
the outstanding Units.

"Conveyance Agreements" shall mean (a) the Contribution Agreement and
(b) each of the individual bills of sale and other conveyance documents
delivered to the Borrower pursuant to the Contribution Agreement in each case
as the same may from time to time be amended, supplemented or otherwise
modified in accordance with the terms thereof and hereof.

"Credit Obligations" means all present and future liabilities,
obligations and Indebtedness of the Borrower or any of its Subsidiaries owing
to the Administrative Agent, the Documentation Agent or any Bank under or in
connection with this Agreement or any other Loan Document, including
obligations in respect of principal, interest, reimbursement obligations under
Letters of Credit and Interest Rate Agreements provided by a Bank (or an
Affiliate of a Bank), commitment fees, Letter of Credit fees, amounts provided
for in Sections 3.2.4, 3.5, 3.6, 3.7, 3.8, 3.10, 3.11 and 3.12 and any other
fees, charges, indemnities and expenses from time to time owing hereunder or
under any other Loan Documents (whether accruing before or after the
commencement of proceedings under any Bankruptcy Law).

"Credit Participant" is defined in Section 11.2.

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19
"Current Management" means the individual executive officers of the
General Partner named as such in the Registration Statement, together with the
heirs of, and trusts for the benefit of family members controlled by, any such
executive officer.

"Disbursement Account" is defined in Section 2.2.3.

"Documentation Agent" means Bank of Oklahoma, National Association in
its capacity as documentation agent for the Banks hereunder.

"Documentation Agent Fee Letter" is defined in Section 3.12.

"Environmental Laws" means all applicable federal, state, local and
foreign laws, rules or regulations as amended from time to time, relating to
emissions, discharges, releases, threatened releases, removal, remediation or
abatement of pollutants, contaminants, chemicals or industrial, toxic or
hazardous substances or wastes into or in the environment (including without
limitation air, surface water, ground water or land), or otherwise used in
connection with the manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of pollutants, contaminants, toxic or
hazardous substances or wastes, as defined under such applicable laws.

"Equity Interest" means, with respect to any Person, any capital stock
issued by such Person, regardless of class or designation, or any limited or
general partnership interest in such Person, regardless of designation, and all
warrants, options, purchase rights, conversion or exchange rights, voting
rights, calls or claims of any character with respect thereto.

"Equity Repurchase" is defined in Section 8.12.

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

"ERISA Affiliate" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code, or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.

"ERISA Event" means (i) any "reportable event", as defined in Section
4043 of ERISA or the regulations issued thereunder, with respect to a Plan;
(ii) the adoption of any amendment to a Plan that would require the provision
of security pursuant to Section 401(a)(29) of the Code or Section 307 of ERISA;
(iii) the existence with respect to any Plan of an "accumulated funding
deficiency" (as defined in Section 412 of the Code or Section 302 of ERISA),
whether or not waived; (iv) the filing pursuant to Section 412(d) of the Code
or Section 303(d) of ERISA of an application for a waiver of the minimum
funding standard with respect to any Plan; (v) the incurrence of any liability
under Title IV of ERISA with respect to the termination of any Plan or the
withdrawal or partial withdrawal of the Borrower or any of its ERISA Affiliates
from any Plan or Multiemployer Plan; (vi) the receipt by the Borrower or any
ERISA Affiliate from the PBGC or a plan administrator of any notice relating to
the intention to terminate any Plan or Plans or to

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20
appoint a trustee to administer any Plan; (vii) the receipt by the Borrower or
any ERISA Affiliate of any notice concerning the imposition of Withdrawal
Liability or a determination that a Multiemployer Plan is, or is expected to
be, insolvent or in reorganization, within the meaning of Title IV of ERISA;
and (viii) the occurrence of a "prohibited transaction" with respect to which
the Borrower or any of its Subsidiaries is a "disqualified person" (within the
meaning of Section 4975 of the Code) and with respect to which the Borrower or
such Subsidiary would be liable for the payment of an excise tax.

"Eurodollars" means, with respect to any Bank, deposits of United
States Funds in a non-United States office or an international banking facility
of such Bank.

"Eurodollar Basic Rate" means, for any Eurodollar Interest Period, the
rate of interest at which Eurodollar deposits in an amount comparable to the
Percentage Interest of Bank of Boston in the portion of a Loan as to which a
Eurodollar Pricing Option has been elected and which have a term corresponding
to such Eurodollar Interest Period are offered to Bank of Boston by first class
banks in the inter-bank Eurodollar market for delivery in immediately available
funds at a Eurodollar Office on the first day of such Eurodollar Interest
Period as determined by Bank of Boston at approximately 10:00 a.m. (Boston
time) two Banking Days prior to the date upon which such Eurodollar Interest
Period is to commence (which determination by Bank of Boston shall, in the
absence of manifest error, be conclusive) and as furnished promptly thereafter
by Bank of Boston to the Administrative Agent.

"Eurodollar Interest Period" means any period, selected as provided in
Section 3.2.1, of one or three months, commencing on any Banking Day and ending
on the corresponding date in the subsequent calendar month so indicated (or, if
such subsequent calendar month has no corresponding date, on the last day of
such subsequent calendar month); provided, however, that subject to Section
3.2.3, if any Eurodollar Interest Period so selected would otherwise begin or
end on a date which is not a Banking Day, such Eurodollar Interest Period shall
instead begin or end, as the case may be, on the immediately preceding or
succeeding Banking Day as determined by the Administrative Agent in accordance
with the then current banking practice in the inter-bank Eurodollar market with
respect to Eurodollar deposits at the applicable Eurodollar Office, which
determination by the Administrative Agent shall, in the absence of manifest
error, be conclusive.

"Eurodollar Loan" means each portion of the Loan bearing interest
determined by reference to the Eurodollar Rate.

"Eurodollar Office" means such non-United States office or
international banking facility of any Bank as the Bank may from time to time
select.

"Eurodollar Pricing Options" means the options granted pursuant to
Section 3.2.1 to have the interest on any portion of a Loan computed on the
basis of a Eurodollar Rate.

"Eurodollar Rate" for any Eurodollar Interest Period means the rate,
rounded upward to the nearest 1/100%, obtained by dividing (a) the Eurodollar
Basic Rate for such Eurodollar Interest

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21
Period by (b) an amount equal to 1 minus the Eurodollar Reserve Rate; provided,
however, that if at any time during such Eurodollar Interest Period the
Eurodollar Reserve Rate applicable to any outstanding Eurodollar Pricing Option
changes, the Eurodollar Rate for such Eurodollar Interest Period shall
automatically be adjusted to reflect such change, effective as of the date of
such change.

"Eurodollar Reserve Rate" means the stated maximum rate (expressed as
a decimal) of all reserves (including any basic, supplemental, marginal or
emergency reserve or any reserve asset), if any, as from time to time in
effect, required by any Bank Legal Requirement to be maintained by any Bank
against (a) "Eurocurrency liabilities" as specified in Regulation D of the
Board of Governors of the Federal Reserve System applicable to Eurodollar
Pricing Options, (b) any other category of liabilities that includes Eurodollar
deposits by reference to which the interest rate on portions of a Loan subject
to Eurodollar Pricing Options is determined, (c) the principal amount of or
interest on any portion of the Loan subject to a Eurodollar Pricing Option or
(d) any other category of extensions of credit, or other assets, that includes
loan subject to a Eurodollar Pricing Option by a non-United States office of
any of the Banks to United States residents, in each case without the benefits
of credits for prorations, exceptions or offsets that may be available to a
Lender.

"Event of Default" means any of the events specified in Section 9.1,
provided that there has been satisfied any requirement in connection with such
event for the giving of notice, or the lapse of time, or the happening of any
further condition, event or act, and "Default" shall mean any of such events,
whether or not any such requirement has been satisfied.

"Excess Proceeds" is defined in Section 4.2.4.

"Excess Sale Proceeds" is defined in Section 7B.7(iii)(c)(II).

"Excess Taking Proceeds" is defined in Section 4.2.3(ii).

"Exchange Act" means the Securities Exchange Act of 1934, as amended.

"Federal Funds Rate" means, for any day, the rate equal to the
weighted average (rounded upward to the nearest 1/8%) of the rates on overnight
federal funds transactions with members of the Federal Reserve System arranged
by federal funds brokers, (i) as such weighted average is published for such
day (or, if such day is not a Banking Day, for the immediately preceding
Banking Day) by the Federal Reserve Bank of New York or (ii) if such rate is
not so published for such Banking Day, as determined by the Administrative
Agent using any reasonable means of determination. Each determination by the
Administrative Agent of the Federal Funds Rate shall, in the absence of
manifest error, be conclusive.

"Final Maturity Date" means (i) with respect to the Working Capital
Loan, June 30, 1999, and (ii) with respect to the Acquisition Loan, June 30,
2001.

"Financial Statement Delivery Date" means each date on which financial
statements are to be delivered pursuant to Section 7A.1(i).

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22
"Financing Statements" shall have the meaning specified in Section
6.1(vi).

"Fixed Charges" shall mean scheduled principal and interest payments
and payments due under Capitalized Lease Obligations.

"Foreign Trade Regulations" means (i) any act that prohibits or
restricts, or empowers the President or any executive agency of the United
States of America to prohibit or restrict, exports to or financial transactions
with any foreign country or foreign national, (ii) the regulations with respect
to certain prohibited foreign trade transactions set forth at 22 C.F.R. parts
120-130 and 31 C.F.R. Part 500 and (iii) any order, regulation, ruling,
interpretation, direction, instruction or notice relating to any of the
foregoing.

"Funding Liability" means (a) any Eurodollar deposit which was used
(or deemed by Section 3.2.6 to have been used) to fund any portion of a Loan
subject to a Eurodollar Pricing Option, and (b) any portion of a Loan subject
to a Eurodollar Pricing Option funded (or deemed by Section 3.2.6 to have been
funded) with the proceeds of any such Eurodollar deposit.

"GAAP" is defined in Section 1.2(i).

"General Partner" means Heritage in its capacity as the general
partner of the Borrower.

"Governmental Authority" means any governmental agency, authority,
instrumentality or regulatory body, other than a court or other tribunal, in
each case whether federal, state, local or foreign.

"Guaranty" means, with respect to any Person, any direct or indirect
liability, contingent or otherwise, of such Person with respect to any
Indebtedness of another, including, without limitation, any such obligation
directly or indirectly guaranteed, endorsed (otherwise than for collection or
deposit in the ordinary course of business) or discounted or sold with recourse
by such Person, or in respect of each such Person is otherwise directly or
indirectly liable, including, without limitation, any such obligation in effect
guaranteed by such Person through any agreement (contingent or otherwise) to
purchase, repurchase or otherwise acquire such obligation or any security
therefor, or to provide funds for the payment or discharge of such obligation
(whether in the form of loans, advances, stock purchases, capital contributions
or otherwise), or to maintain the solvency or any balance sheet or other
financial condition of the obligor of such obligation, or to make payment for
any products, materials or supplies or for any transportation or services
regardless of the non-delivery or non-furnishing thereof, in any such case if
the purpose or intent of such agreement is to provide assurance that such
obligation will be paid or discharged, or that any agreements relating thereto
will be complied with, or that the holders of such obligation will be protected
against loss in respect thereof. The amount of any Guaranty shall be equal to
the outstanding principal amount of the obligation guaranteed or such lesser
amount to which the maximum exposure of the guarantor shall have been
specifically limited.

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23
"Hazardous Substance" means any substance so designated pursuant to
CERCLA, asbestos, petroleum, urea formaldehyde insulation and petroleum
by-products (other than propane).

"Heritage" means Heritage Holdings, Inc., a Delaware corporation.

"Indebtedness" shall mean, with respect to any Person, without
duplication,

(a) any indebtedness for borrowed money, all obligations upon
which interest charges are customarily paid and all obligations evidenced by
any bond, note, debenture or other similar instrument which such Person has
directly or indirectly created, incurred or assumed;

(b) all obligations of others secured by any Lien in respect of
property owned by such Person, whether or not such Person has assumed or become
liable for the payment of such indebtedness; provided that the amount of such
Indebtedness, if such Person has not assumed the same or become liable
therefor, shall in no event be deemed to be greater than the fair market value
from time to time of the property subject to such Lien;

(c) any indebtedness, whether or not for borrowed money (excluding
trade payables and accrued expenses arising in the ordinary course of
business), with respect to which such Person has become directly or indirectly
liable and which represents the deferred purchase price (or a portion thereof)
or has been incurred to finance the purchase price (or a portion thereof) of
any property or service or business acquired by such Person, whether by
purchase, consolidation, merger or otherwise;

(d) the principal component of any Capitalized Lease Obligations
to the extent such obligations would, in accordance with GAAP, appear on a
balance sheet of such Person;

(e) all Attributable Debt of such Person in respect of Sale and
Lease-Back Transactions not involving a Capitalized Lease Obligation;

(f) all Redeemable Capital Stock of such Person valued at the
greater of its voluntary or involuntary maximum fixed repurchase price plus
accrued dividends;

(g) any Preferred Stock of any Subsidiary of such Person valued at
the liquidation preference thereof, or any mandatory redemption payment
obligations in respect thereof plus, in either case, accrued dividends thereon;

(h) any indebtedness of the character referred to in clause (a),
(b), (c), (d), (e), (f) or (g) of this definition deemed to be extinguished
under GAAP but for which such Person remains legally liable;

(i) any indebtedness of any other Person of the character referred
to in clause (a), (b), (c), (d), (e), (f), (g) or (h) of this definition with
respect to which the Person whose Indebtedness is being determined has become
liable by way of a Guaranty;

-17-
24
(j) all obligations, contingent or fixed, of such person as an
account party in respect of letters of credit (other than letters of credit
incurred in the ordinary course of business and consistent with past practice);

(k) all liabilities of such Person in respect of unfunded vested
benefits under pension plans (determined on a net basis for all such plans) and
all asserted withdrawal liabilities of such Person or a commonly controlled
entity to a Multiemployer Plan;

(l) Swaps (other than Interest Rate Agreements);

(m) all obligations of such Person in respect of bankers'
acceptances (other than in respect of accounts payable to suppliers incurred in
the ordinary course of business consistent with past practice); and

(n) any amendment, supplement, modification, deferral, renewal,
extension or refunding of any liability of the types referred to in clauses (a)
through (m) above.

For purposes hereof, the "maximum fixed repurchase price" of any
Redeemable Capital Stock which does not have a fixed repurchase price shall be
calculated in accordance with the terms of such Redeemable Capital Stock as if
such Redeemable Capital Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to this Agreement and if such price
is based upon, or measured by, the fair market value of such Redeemable Capital
Stock, such fair market value shall be determined in good faith by the board of
directors or a similar governing body of the issuer of such Redeemable Capital
Stock.

"Initial Closing Date" shall mean June 28, 1996.

"Intercreditor Agreement" means the Intercreditor and Agency Agreement
among the Purchasers of the Private Placement Notes, the Administrative Agent
and the Collateral Agent.
"Interest Coverage" means, as of any date, a ratio equal to the ratio
of (a) the Consolidated EBITDA of the Borrower for the period of four
consecutive fiscal quarters of the Borrower ending with the most recent fiscal
quarter for which the Borrower has delivered to the Banks, or is required under
Section 7A.1(i) to have delivered to the Banks, financial statements of the
Borrower to (b) the Consolidated Interest Expense of the Borrower for such
period of four consecutive fiscal quarters.

"Interest Rate Agreement" shall mean any fully matched interest rate
Swap entered into with the intent to protect the Borrower against fluctuations
in interest rates and entered into as a bona fide hedging arrangement and not
for purposes of investment or speculation.

"Investment" shall mean, as applied to any Person, any direct or
indirect purchase or other acquisition by such Person of stock or other
securities of any other Person, or any direct or indirect loan, advance or
capital contribution by such Person to any other Person, and any other item
which would be classified as an "investment" on a balance sheet of such Person
prepared in accordance with GAAP, including without limitation any direct or
indirect contribution by such Person of

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25
property or assets to a joint venture, partnership or other business entity in
which such Person retains an interest (it being understood that a direct or
indirect purchase or other acquisition by such Person of assets of any other
Person (other than stock or other securities) shall not constitute an
"Investment" for purposes of this Agreement so long as such assets are all used
in the Business). For the purposes of Section 7B.5(v), the amount involved in
Investments made during any period shall be the aggregate cost to the Borrower
and its Subsidiaries of all such Investments made during such period,
determined in accordance with GAAP, but without regard to unrealized increases
or decreases in value, or write-ups, write-downs or write-offs, of such
Investments and without regard to the existence of any undistributed earnings
or accrued interest with respect thereto accrued after the respective dates on
which such Investments were made, less any net return of capital realized
during such period upon the sale, repayment or other liquidation of such
Investments (determined in accordance with GAAP, but without regard to any
amounts received during such period as earnings (in the form of dividends not
constituting a return of capital, interest or otherwise) on such Investments or
as loans from any Person in whom such Investments have been made). See Section
1.2(i).

"Investment Limit" shall have the meaning specified in Section 7B.5.

"Legal Requirement" shall mean any law, statute, ordinance, decree,
requirement, order, judgment, rule or regulation (or published official
interpretation of any of the foregoing by any Governmental Authority) of any
Governmental Authority.

"Lending Officer" means each of such individuals whom the
Administrative Agent may designate by notice to the Borrower from time to time
as an officer who may receive telephone requests for borrowings under Section
2.1.3 and 2.2.3.

"Letter of Credit" is defined in Section 2.3.1.

"Letter of Credit Exposure" means, at any date, the sum of (a) the
aggregate face amount of all drafts that may then or thereafter be presented by
beneficiaries under all Letters of Credit then outstanding, plus (b) the
aggregate face amount of all drafts that the Letter of Credit Issuer has
previously accepted under Letters of Credit but has not paid.

"Letter of Credit Issuer" means, for any Letter of Credit, Bank of
Boston or BOk or, in the event either Bank of Boston or BOk does not for any
reason issue a requested Letter of Credit, another Bank designated by the
Agents to issue such Letter of Credit in accordance with Section 2.3.

"Leverage Ratio" means, as of any date, a ratio equal to the ratio of
(a) the Consolidated Funded Indebtedness of the Borrower as of the last day of
the most recent fiscal quarter of the Borrower for which the Borrower has
delivered to the Banks, or is required under Section 7A.1(i) to have delivered
to the Banks, a consolidated balance sheet of the Borrower to (b) the
Consolidated EBITDA of the Borrower for the period of four consecutive fiscal
quarters ended on such last day.

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26
"Liabilities" is defined in the second opening paragraph of the Note
Purchase Agreement in effect on the date hereof.

"Lien" means any mortgage, pledge, security interest, encumbrance,
contractual deposit arrangement, lien (statutory or otherwise) or charge of any
kind (including any agreement to give any of the foregoing, any conditional
sale or other title retention agreement, any lease in the nature thereof, and
the filing of or agreement to give any financing statement under the Uniform
Commercial Code of any jurisdiction) or any other type of preferential
arrangement for the purpose, or having the effect, of protecting a creditor
against loss or securing the payment or performance of an obligation.

"Loan" means each of the Working Capital Loan and the Acquisition
Loan.

"Loan Documents" means this Agreement, the Intercreditor Agreement,
the Administrative Agent Fee Letter, the Documentation Agent Fee Letter and
the Security Documents.

"Margin Period" means each period commencing on (and including) the
Initial Closing Date or a Financial Statement Delivery Date and ending on (and
excluding) the earlier of (i) the next occurring Financial Statement Delivery
Date or (ii) in the case of the Acquisition Facility, the Acquisition
Conversion Date or, in the case of the Working Capital Facility, the Final
Maturity Date with respect to the Working Capital Loans.

"Margin Stock" means "margin stock" within the meaning of Regulation
G, T, U or X of the Board of Governors of the Federal Reserve System.

"Master Partnership" means Heritage Propane Partners, L.P., a Delaware
limited partnership.

"Material Adverse Effect" means (i) a material adverse effect on the
business, assets or financial condition of the Borrower or the Borrower and its
Subsidiaries taken as a whole after giving effect to the Transactions, (ii) a
material impairment of the ability of the Borrower or any Subsidiary of the
Borrower to perform any of its obligations under the Loan Documents to which it
is a party or (iii) a material adverse effect on the enforceability of any of
the Loan Documents.

"Maximum Amount of Acquisition Credit" is defined in Section 2.1.2.

"Maximum Amount of Working Capital Credit" is defined in Section
2.2.2.

"Memorandum" means the memorandum dated May, 1996, prepared by
Prudential Securities for use in connection with the Borrower's private
placement of the Private Placement Notes.

"Multiemployer Plan" means a "multiemployer plan" as defined in
section 4001(a)(3) of ERISA.

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27
"Net Proceeds" means the proceeds of any sale of assets in the form of
cash or cash equivalents including payments in respect of deferred payment
obligations when received in the form of cash or cash equivalents net of (i)
brokerage commissions and other fees and expenses related to such sale, (ii)
provisions for any taxes payable as a result of such sale, (iii) amounts
required to be paid to any Person (other than the Borrower or any Subsidiary
of the Borrower) owning a beneficial interest in the assets sold, (iv)
appropriate amounts to be provided by the Borrower or any Subsidiary of the
Borrower, as the case may be, as a reserve required in accordance with GAAP
against any liabilities associated with such sale of assets and retained by the
Borrower or any Subsidiary of the Borrower, as the case may be, after such
sale and (v) amounts required to be applied to the repayment of Indebtedness
(other than the Private Placement Notes and amounts due under the Working
Capital Facility or Acquisition Facility) secured by a Lien on the assets sold.

"Non-Compete Obligations" is defined in Section 7B.3(viii).

"Noncompliance Event" means either or both of the following:

(a) failure of the Borrower to maintain a Leverage Ratio that is
(i) equal to or less than 5.25 to 1 as of any date on or prior to August 31,
1997, (ii) equal to or less than 5 to 1 as of any date after August 31, 1997
and on or prior to Xxxxxx 00, 0000, (xxx) equal to or less than 4.75 to 1 as of
any date after August 31, 1998 and on or prior to February 28, 1999 or (iv)
equal to or less than 4.5 to 1 as of any date after February 28, 1999; and

(b) failure of the Borrower to maintain Interest Coverage that is
(i) equal to or greater than 2.0 to 1 as of any date on or prior to June 27,
1997 or (ii) equal to or greater than 2.25 to 1 as of any date after June 27,
1997.

"Nonperforming Bank" is defined in Section 10.4.4.

"Note Purchase Agreement" means that certain Note Purchase Agreement
between Heritage, Borrower and the Note Purchasers named in the Purchaser
Schedule annexed as Schedule I thereto dated as of June 24, 1996.

"Note Purchasers" mean the purchasers of the Private Placement Notes.

"Notes" means the Working Capital Notes and the Acquisition Notes.

"Obligations" means and include any and all: (i) indebtedness,
obligations and liabilities of the Borrower to the Banks incurred or which may
be incurred or purportedly incurred hereafter pursuant to the terms of this
Agreement or any of the other Loan Documents, and any replacements, amendments,
extensions, renewals, substitutions, amendments and increases in amount
thereof, including such amounts as may be evidenced by the Notes and all lawful
interest, late charges, loan closing fees, service fees, origination/facility
fees, commitment fees, fees in lieu of balances, letter of credit processing
and issuance fees and other charges, and all reasonable costs and expenses
incurred in connection with the preparation, filing and recording of the Loan
Documents, including

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28
reasonable attorneys fees and legal expenses; (ii) all reasonable costs and
expenses paid or incurred by the Banks and/or either Agent or the Collateral
Agent, including reasonable attorneys fees, in enforcing or attempting to
enforce collection of any Indebtedness and in enforcing or realizing upon or
attempting to enforce or realize upon any collateral or security for any
Indebtedness, including interest on all sums so expended by the Banks and/or
either Agent or the Collateral Agent accruing from the date upon which such
expenditures are made until paid, at an annual rate equal to the Default Rate;
and (iii) all sums expended by the Banks and/or either Agent or the Collateral
Agent in curing any Event of Default or Default of the Borrower under the terms
of this Agreement, the other Loan Documents or any other writing evidencing or
securing the payment of the Notes together with interest on all sums so
expended by the Banks and/or either Agent or the Collateral Agent accruing from
the date upon which such expenditures are made until paid, at an annual rate
equal to the Default Rate; and (iv) indebtedness, obligations and liabilities
of the Borrower arising out of the Note Purchase Agreement including, without
limitation, that evidenced by the Private Placement Notes.

"Offering" is defined in the second opening paragraph of the Note
Purchase Agreement as in effect on the date hereof.

"Officer's Certificate" shall mean, as to any corporation, a
certificate executed on its behalf by the Chairman of the Board of Directors
(if an officer) or its President or one of its Vice Presidents, and its
Treasurer, or Controller, or one of its Assistant Treasurers or Assistant
Controllers, and, as to the Master Partnership or the Borrower, a certificate
executed on behalf of the Master Partnership or the Borrower, as the case may
be, by its general partner in a manner which would qualify such certificate (a)
if such general partner were a corporation, as an Officer's Certificate of such
general partner hereunder or (b) if such general partner were a partnership or
other entity, as a certificate executed on its behalf by Persons authorized to
do so pursuant to the constituting documents of such partnership or other
entity.

"Operative Agreements" means the Contribution Agreement, the other
Conveyance Agreements, and the Partnership Agreement.

"Overdue Reimbursement Rate" means, at any date, the highest
Applicable Rate then in effect.

"Parity Debt" means Indebtedness of the Borrower (a) (other than the
Notes) incurred in accordance with clauses (i), (ii) and (iii) of Section 7B.2
and (b) Additional Parity Debt.

"Partnership Agreement" means the Agreement of Limited Partnership of
the Borrower as in effect on the Closing Date, and as the same may from time to
time be amended, supplemented or otherwise modified in accordance with the
terms thereof.

"Partnership Documents" means the Agreement of Limited Partnership of
the Master Partnership and the Partnership Agreement , in each case as in
effect on the Closing Date and as the

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29
same may from time to time be amended, supplemented or otherwise modified in
accordance with the terms hereof and thereof.

"Payment Date" means the last Banking Day of each March, June,
September and December occurring after the Initial Closing Date.

"PBGC" means the Pension Benefit Guaranty Corporation or any
Governmental Authority succeeding to any of its functions.

"Percentage Interest" is defined in Section 10.1.

"Performing Bank" is defined in Section 10.4.4.

"Permits" is defined in Section 8.8.

"Permitted Banks" is defined in Section 7B.5.

"Person" means and includes an individual, a partnership, a joint
venture, a corporation, a trust, an unincorporated organization and a
government or any department or agency thereof.

"Plan" means any "employee pension benefit plan" as such term is
defined in Section 3 of ERISA (other than a Multiemployer Plan) subject to the
provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of
ERISA, and in respect of which the Borrower or any ERISA Affiliate is (or, if
such plan were terminated, would under Section 4069 of ERISA be deemed to be)
an "employer" as defined in Section 3(5) of ERISA.

"Preferred Stock" means, as applied to the Capital Stock of any
Person, Capital Stock of any class or classes (however designated), which is
preferred as to the payment of distributions or dividends, or upon any
voluntary or involuntary liquidation or dissolution of such Person, over shares
or units of Capital Stock of any other class of such Person.

"Priority Debt" means as of any date of determination, the sum,
without duplication, of (i) Indebtedness of the Subsidiaries of the Borrower
(other than Indebtedness owed to the Borrower or another Wholly-Owned
Subsidiary), plus (ii) Indebtedness of the Borrower and its Subsidiaries
secured by Liens permitted by clauses (i) and (vii) of Section 7B.3 and any
renewals of such Liens permitted by clause (xiv) of Section 7B.3

"Property" means any interest in any kind of property or asset whether
real, personal, or mixed, or tangible or intangible.

"PUHCA" is defined in Section 8.20.

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"Private Placement Notes" means the $120,000,000 senior secured notes
issued pursuant to the Memorandum, sold to the Purchasers and described and
defined in the Note Purchase Agreement as the "Notes."

"Redeemable Capital Stock" means, as of any date of determination, any
shares of any class or series of Capital Stock, that, either by the terms
thereof, by the terms of any security into which such shares are convertible or
exchangeable or by contract or otherwise, are or upon the happening of an event
or passage of time would be, required to be redeemed prior to the stated
maturity with respect to the principal of any Loans or are redeemable at the
option of the holder thereof at any time prior to the stated maturity of any
Loans, or are convertible into or exchangeable for Indebtedness at any time
prior to the stated maturity of any Loans.

"Register" is defined in Section 11.1.3.

"Registration Statement" means the Registration Statement on Form S-1
of Heritage Propane Partners, L.P. (Registration No. 333-4018) filed with the
Commission on April 25, 1996, as amended by Amendment No. 1, filed with the
Commission on June 4, 1996, Amendment No. 2, filed with the Commission on June
14, 1996, and Amendment No. 3, filed with the Commission on June 22, 1996, in
the form when declared effective by the Commission and as amended on or prior
to the date of this Agreement.

"Replacement Bank" is defined in Section 11.3.

"Required Banks" means, with respect to any approval, consent,
modification, waiver or other action to be taken by the Administrative Agent or
the Banks under the Loan Documents which require action by the Required Banks,
such Banks that own at least 66 2/3% of the Percentage Interests; provided,
however, that with respect to any matters referred to in the proviso to Section
10.6, Required Banks means such Banks as own at least the respective portions
of the Percentage Interests required by Section 10.6.

"Responsible Officer" means the chief executive officer, chief
operating officer, chief financial officer or chief accounting officer of the
Borrower or any other officer of the Borrower involved principally in its
financial administration or its controllership function.

"Restricted Payment" means any payment or other distribution, direct
or indirect, in respect of any partnership or other equity interest in the
Borrower, except a distribution payable solely in additional partnership or
other equity interests in the Borrower, and any payment, direct or indirect on
account of the redemption, retirement, purchase or other acquisition of any
partnership or other equity interest in the Borrower.

"Sale and Lease-Back Transaction" means, with respect to any Person (a
"Transferor"), any arrangement (other than between the Borrower and a
Wholly-Owned Restricted Subsidiary or between Wholly-Owned Restricted
Subsidiaries) whereby (a) property (the "Subject Property") has been or is to
be disposed of by such Transferor to any other Person with the intention on the
part of

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such Transferor of taking back a lease of such Subject Property pursuant to
which the rental payments are calculated to amortize the purchase price of such
Subject Property substantially over the useful life of such Subject Property,
and (b) such Subject Property is in fact so leased by such Transferor or an
Affiliate of such Transferor.

"Securities Act" means the Securities Act of 1933, as amended.

"Security Agreement" shall mean the Security Agreement from the
Borrower and Heritage, as debtors and assignors, to the Collateral Agent, for
the benefit of the Banks and the Note Purchasers, as secured parties,
encumbering the Collateral described therein and covered thereby.

"Security Documents" shall mean the Security Agreement, the
Certificates and Stock Powers and the Financing Statements.

"Senior Debt" shall mean Indebtedness of the Borrower which is not
expressed to be junior or subordinate to any other Indebtedness of the
Borrower.

"Significant Subsidiary Group" shall mean any Subsidiary of the
Borrower, or any group of Subsidiaries of the Borrower, which at any time of
determination account for (or in the case of a recently formed or acquired
Subsidiary would have so accounted for on a pro forma basis) more than 5% of
consolidated operating revenues of the Borrower and its Subsidiaries for the
fiscal year most recently ended or more than 5% of consolidated total assets of
the Borrower and its Subsidiaries as of the end of the most recently ended
fiscal quarter, in each case computed in accordance with GAAP.

"Subordinated Units" shall have the meaning specified in the second
opening paragraph of the Note Purchase Agreement as in effect on the date
hereof.

"Subsidiary" shall mean, with respect to any Person, any corporation,
limited liability Borrower, partnership, joint venture, association, trust or
other entity of which (or in which) more than 50% of (a) the issued and
outstanding Capital Stock having ordinary voting power to elect a majority of
the board of directors of such corporation (irrespective of whether at the time
Capital Stock of any other class or classes of such corporation shall or might
have voting power upon the occurrence of any contingency), (b) the interests in
the capital or profits of such partnership, limited liability Borrower, joint
venture or association with ordinary voting power to elect a majority of the
board of directors (or Persons performing similar functions) of such
partnership, limited liability Borrower, joint venture or association, or (c)
the beneficial interests in such trust or other entity with ordinary voting
power to elect a majority of the board of trustees (or Persons performing
similar functions) of such trust or other entity, is at the time directly or
indirectly owned or controlled by such Person, by such Person and one or more
of its other Subsidiaries, or by one or more of such Person's other
Subsidiaries. For the purposes of any computation under Section 6A or clause
(xiii) of Section 6B, the defined terms Consolidated Debt Service, Consolidated
EBITDA, Consolidated Funded Indebtedness, Consolidated Interest Expense and
Consolidated Pro Forma Maximum Debt Service shall be calculated on the basis
that Bi-State is a Subsidiary of the Borrower, but only as

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long as the Borrower shall own 50% or more of the interests in the capital or
profits of Bi-State with ordinary voting power to elect a majority of the board
of directors (or Persons performing similar functions) thereof.

"Swaps" shall mean, with respect to any Person, payment obligations
(fixed or contingent) with respect to interest rate swap agreements, interest
rate cap agreements, interest rate collar agreements, currency swaps and
similar obligations obligating such Person to make payments, whether
periodically or upon the happening of a contingency. For the purposes of this
Agreement, the amount of the obligation under any Swap shall be the amount
determined in respect thereof as of the end of the then most recently ended
fiscal quarter of such Person, based on the assumption that such Swap had
terminated at the end of such fiscal quarter, and in making such determination,
if any agreement relating to such Swap provides for the netting of amounts
payable by and to such Person thereunder or if any such agreement provides for
the simultaneous payment of amounts by and to such Person, then in each such
case, the amount of such obligation shall be the net amount so determined.

"Tax" means any present or future tax, levy, duty, impost, deduction,
withholding or other charges of whatever nature at any time required by any
Bank Legal Requirement (i) to be paid by any Bank or (ii) to be withheld or
deducted from any payment otherwise required hereby to be made to any Bank, in
each case on or with respect to its obligations hereunder, the Loan, any
payment in respect of the Credit Obligations or any Funding Liability not
included in the foregoing; provided, however, that the term "Tax" shall not
include taxes imposed upon or measured by the net income of such Bank (other
than withholding taxes) or franchise taxes.

"Total Assets" means, as of any date of determination, the
consolidated total assets of the Borrower and its Subsidiaries as would be
shown on a consolidated balance sheet of the Borrower and its Subsidiaries
prepared in accordance with GAAP as of that date. See Section 1.2(i).

"Transactions" is defined in the third opening paragraph of the Note
Purchase Agreement as in effect on the date hereof.

"UCC" means the Uniform Commercial Code.

"Underwriting Agreement" means the Underwriting Agreement, dated the
date hereof, among the Partnership, the underwriters named in Schedule I
thereto and the other signatories thereto, relating to the Common Units
registered under the Registration Statement.

"Uniform Customs and Practice" is defined in Section 2.3.7.

"United States" or "U.S." means the United States of America.

"United States Funds" means such coin or currency of the United States
as at the time shall be legal tender therein for the payment of public and
private debts.

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"Units" means, collectively, the Common Units and the Subordinated
Units.

"Unused Proceeds Reserve" means, as of any date of determination, all
amounts theretofore offered to prepay Parity Debt under Section
7B.7(iii)(c)(II) and to prepay Notes under Section 4.2, the prepayment of which
was declined by the applicable lenders, less the portion of such amounts
theretofore applied by the Borrower to operations or capital expenditures in
connection with the conduct of the Borrower's business.

"Unutilized Taking Proceeds" means, as of any date, any insurance or
condemnation proceeds (net of the reasonable costs of proceedings in connection
therewith and settlements in respect thereof) in excess of $100,000 with
respect to any single occurrence that were received by the Borrower or any of
its Subsidiaries in respect of any damage, destruction, condemnation or other
taking of all or any portion of the properties or assets of the Borrower or any
of its Subsidiaries and that have not been reinvested by the Borrower or any
of its Subsidiaries within a period of twelve months after such receipt in the
restoration, modification or replacement of the properties or assets in respect
of which such insurance or condemnation proceeds were received.

"Voting Stock" means, with respect to any corporation, any shares of
stock of such corporation the holders of which are entitled under ordinary
circumstances to vote for the election of directors of such corporation
(irrespective of whether at the time stock of any other class or classes shall
have or might have voting power by reason of the happening of any contingency).

"Wholly-Owned" means, as applied to any Subsidiary of any Person, a
Subsidiary at least 98% (by vote or value) of the outstanding Equity Interests
(other than directors' qualifying shares, if required by law) of all classes,
taken together as a whole, of which are at the time owned by such Person or by
one or more of its Wholly-Owned Subsidiaries or by such Person and one or more
of its Wholly-Owned Subsidiaries.

"Withdrawal Liability" shall mean liability to a Multiemployer Plan as
a result of a complete or partial withdrawal from such Multiemployer Plan, as
such terms are defined in Part I of Subtitle E of Title IV of ERISA.

"Working Capital Facility" means the agreement of the Banks herein to
make Working Capital Loan and to provide for the issuance of Letters of Credit.

"Working Capital Loan Account" is defined in Section 2.2.4.

"Working Capital Loan" is defined in Section 2.2.4.

"Working Capital Notes" is defined in Section 2.2.4.

1.2 Accounting Principles, Terms and Determinations.

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(i) All references in this Agreement to "generally accepted
accounting principles" or to "GAAP" shall be deemed to refer to generally
accepted accounting principles in effect in the United States at the time of
application thereof, but subject to the provisions of this Section 1.2(i).
Unless otherwise specified herein, all accounting terms used herein shall be
interpreted, all determinations with respect to accounting matters hereunder
shall be made, and all unaudited financial statements and certificates and
reports as to financial matters required to be prepared hereunder shall be
prepared in accordance with generally accepted accounting principles, applied
on a basis consistent with the most recent audited consolidated financial
statements of the Borrower and its Subsidiaries delivered pursuant to clause
(ii) of Section 7A.1 or, if no such statements have been so delivered, the most
recent audited financial statements referred to in clause (iii) of Section 8.4.

(ii) For the purpose of computing the consolidated financial
position, results of operation or other balance sheet or financial statement
items (including without limitation; Consolidated Debt Service, Consolidated
EBITDA, Consolidated Income Tax Expense, Consolidated Indebtedness,
Consolidated Interest Expense, Consolidated Net Income, Consolidated Non-Cash
Charges, Consolidated Pro Forma Maximum Debt Service and Consolidated Total
Assets) for any period prior to the Closing Date, such financial position,
results of operation and balance sheet or financial statement items shall
include Heritage and its Subsidiaries, determined on a consolidated basis in
accordance with GAAP, as reflected on the financial statements prepared by
Heritage and delivered to the Banks for any such period prior to the Closing
Date.

1.3 Construction. Except as otherwise explicitly specified to the
contrary or unless the context clearly requires otherwise, (i) the capitalized
term "Section" refers to sections of this Agreement, (ii) the capitalized term
"Exhibit" refers to exhibits to this Agreement, (iii) references to a
particular Article Section include all subsections thereof, (iv) the word
"including" shall be construed as "including without limitation", (v) terms
defined in the UCC and not otherwise defined herein have the meaning provided
under the UCC, (vi) references to a particular statute or regulation include
all rules and regulations thereunder and any successor statute, regulation or
rules, in each case as from time to time in effect and (vii) references to a
particular Person include such Person's successors and assigns to the extent
not prohibited by this Agreement and the other Loan Documents. References to
"the date hereof" mean the date first set forth above.

ARTICLE II

THE CREDITS

2.1 Acquisition Facility.

2.1.1 Acquisition Loan. Subject to all the terms and
conditions of this Agreement and so long as so long as no Default
exists, from time to time on and after the Initial Closing Date and
prior to December 31, 1998 (the "Acquisition Conversion Date") the
Banks will, severally in accordance with their respective Percentage
Interests, make loans to the Borrower in such amounts as may be
requested by the Borrower in accordance with Section

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2.1.3. The sum of the aggregate principal amount of loans made under
this Section 2.1.1 at any one time outstanding shall in no event
exceed the Maximum Amount of Acquisition Credit.

2.1.2 Maximum Amount of Acquisition Credit. The term
"Maximum Amount of Acquisition Credit" means, on any date on or prior
to the Acquisition Conversion, the lesser of (a) $35,000,000 or (b)
the aggregate Acquisition Loan Commitments described in Section 10.1,
as amended from time to time, or such lesser amount as the Borrower
may specify from time to time by notice from Borrower to the
Administrative Agent and, after the Acquisition Conversion, zero.

2.1.3 Acquisition Loan Borrowing Requests. The Borrower
may from time to time request a loan under Section 2.1.1 by providing
to the Administrative Agent a notice in writing (with a copy to each
Bank). Such notice must be not later than noon (Boston time) 10
Banking Days prior to the requested funding date for such loan. The
notice must specify (a) the amount of the requested loan (which shall
be not less than $500,000 and in integral multiples of $100,000 in
excess thereof) and (b) the requested funding date therefor (which
shall be a Banking Day). Each such notice shall be accompanied by (i)
a memorandum from the Chief Financial Officer of Borrower's general
partner summarizing the proposed acquisition or capital expenditures
to be financed by the advance, (ii) in the case of an acquisition a
complete copy of the signed letter of intent (with all exhibits or
schedules thereto to the extent available), (iii) a full and complete
copy of the Borrower's internal acquisition or capital expenditure
model (in general form, content and detail as utilized by the General
Partner or its Affiliates for similar acquisitions or capital
expenditures prior to the Initial Closing Date) and (iv) a full,
completed copy of the confidential business questionnaire in the
general form as utilized by Heritage or its Affiliates prior to the
Initial Closing Date (collectively the "Acquisition/Capex Due
Diligence Packet"). Upon receipt of such notice, the Administrative
Agent will promptly inform each other Bank (by telephone or
otherwise). Each such loan will be made at the Boston Office by
depositing the amount thereof to the Disbursement Account of the
Borrower with the Administrative Agent. In connection with each such
loan, the Borrower shall furnish to the Administrative Agent a
certificate in substantially the form of Exhibit 2.1.3.

2.1.4 Acquisition Loan Account: Acquisition Notes. The
Administrative Agent will establish on its books an acquisition loan
account for the Borrower (the "Acquisition Loan Account") which the
Administrative Agent shall administer as follows: (a) the
Administrative Agent shall add to the Acquisition Loan Account, and
the Acquisition Loan Account shall evidence, the principal amount of
all loans from time to time made by the Banks to the Borrower pursuant
to Section 2.1.1 and (b) the Administrative Agent shall reduce the
Acquisition Loan Account by the amount of all payments made on account
of the Obligation evidenced by the Acquisition Loan Account. The
aggregate principal amount of the Indebtedness from time to time
evidenced by the Acquisition Loan Account is referred to as the
"Acquisition Loan." The Acquisition Loan shall be deemed owed to each
Bank severally in accordance with such Bank's Percentage Interest, and
all payments credited to

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the Acquisition Loan Account shall be for the account of each Bank in
accordance with its Percentage Interest. The Borrower's obligations
to pay each Bank's Percentage Interest in the Acquisition Loan shall
be evidenced by a separate note of the Borrower in substantially the
form of Exhibit 2.1.4 (the "Acquisition Notes"), payable to each Bank
in maximum principal amount equal to such Bank's Percentage Interest
in the total Commitments constituting the Acquisition Facility.

2.2 Working Capital Facility.

2.2.1 Working Capital Loan. Subject to all the terms and
conditions of this Agreements and so long as no Default exists, from
time to time on and after the Initial Closing Date and prior to the
Final Maturity Date with respect to the Working Capital Loan the Banks
will, severally in accordance with their respective Percentage
Interests, make loans to the Borrower in such amounts as may be
requested by the Borrower in accordance with Section 2.2.3. The sum
of the aggregate principal amount of loans made under this Section
2.2.1 at any one time outstanding plus the Letter of Credit Exposure
shall in no event exceed the Maximum Amount of Working Capital Credit.

2.2.2 Maximum Amount of Working Capital Credit. The term
"Maximum Amount of Working Capital Credit" means, on any date,
$15,000,000 minus the outstanding principal balance on the
Indebtedness permitted by Section 7B.2(v) or such lesser amount as the
Borrower may specify from time to time by notice from the Borrower to
the Administrative Agent; provided that the aggregate outstanding
principal amount of Working Capital Loan shall be $0 for a period of
not less than 30 consecutive calendar days at least one time during
each fiscal year of the Borrower (the "Annual Clean-Up"). Failure by
the Borrower to comply with the provisions of the Annual Clean-Up
shall constitute a failure to pay the Loans when due and an Event of
Default under Section 9.1.

2.2.3 Working Capital Borrowing Requests. The Borrower may
from time to time request a loan under Section 2.2.1 by providing to
the Administrative Agent a notice (which may be given by a telephone
call received by a Lending Officer if promptly confirmed in writing).
Such notice must be not later than noon (Boston time) on the first
Banking Day (third Banking Day if any portion of such loan will be
subject to a Eurodollar Pricing Option on the requested Closing Date)
prior to the requested advance date for such loan. The notice must
specify (a) the amount of the requested loan (which shall be not less
than $100,000 and in integral multiples of $50,000 in excess thereof)
and (b) the requested advance date therefor (which shall be a Banking
Day). Upon receipt of such notice, the Administrative Agent will
promptly inform each other Bank (by telephone or otherwise). Each
such loan will be made at the Boston Office by depositing the amount
thereof to the Administrative Agent's special disbursement account
(the "Disbursement Account") for immediate wire transfer thereby to
the operating account of the Borrower with the Documentation Agent.
In connection with each such loan, the Borrower shall furnish to the
Administrative Agent a certificate in substantially the form of
Exhibit 2.2.3.

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2.2.4 Working Capital Loan Account: Working Capital Notes.
The Administrative Agent will establish on its books a working capital
loan account for the Borrower (the "Working Capital Loan Account"),
which the Administrative Agent shall administer as follows: (a) the
Administrative Agent shall add to the Working Capital Loan Account,
and the Working Capital Loan Account shall evidence, the principal
amount of all loans made from time to time by the Banks to the
Borrower pursuant to Section 2.2.1 and (b) the Administrative Agent
shall reduce the Working Capital Loan Account by the amount of all
payments made on account of the Indebtedness evidenced by the Working
Capital Loan Account. The aggregate principal amount of the
Indebtedness evidenced by the Working Capital Loan Account is referred
to as the "Working Capital Loan." The Working Capital Loan shall be
deemed owed to each Bank severally in accordance with such Bank's
Percentage Interest, and all payments credited to the working Capital
Loan Account shall be for the account of each Bank in accordance with
its Percentage Interest. The Borrower's obligations to pay each
Bank's Percentage Interest in the Working Capital Loan shall be
evidenced by a separate note of the Borrower in substantially the form
of Exhibit 2.2.4 (the "Working Capital Notes"), payable to each Bank
in maximum principal amount equal to such Bank's Percentage Interest
in the total Commitments constituting the Working Capital Facility.

2.3 Letters of Credit.

2.3.1 Issuance of Letters of Credit. Subject to all the
terms and conditions of this Agreement and so long as no Default
exists, from time to time on and after the Closing Date and prior to
30 days prior to the Final Maturity Date with respect to the Working
Capital Loan, the Letter of Credit Issuer will issue for the account
of the Borrower one or more irrevocable documentary or standby letters
of credit (the "Letters of Credit"). Letter of Credit Exposure plus
the Working Capital Loan shall in no event exceed the Maximum Amount
of Working Capital Facility. Letter of Credit Exposure shall in no
event exceed $5,000,000.

2.3.2 Requests for Letters of Credit. The Borrower may
from time to time request a Letter of Credit to be issued by providing
to the Letter of Credit Issuer (and the Administrative Agent if the
Letter of Credit Issuer is not the Administrative Agent) a notice
which is actually received not less than five Banking Days prior to
the requested issuance date for such Letter of Credit specifying (a)
the amount of the requested Letter of Credit, (b) the beneficiary
thereof, (c) the requested issuance date and (d) the principal terms
of the text for such Letter of Credit. Each Letter of Credit will be
issued by forwarding it to the Borrower or to such other Person as
directed in writing by the Borrower. In connection with the issuance
of any Letter of Credit, the Borrower shall furnish to the Letter of
Credit Issuer (and the Administrative Agent if the Letter of Credit
Issuer is not the Administrative Agent) a certificate in substantially
the form of Exhibit 2.3.2. and any customary application forms
required by the Letter of Credit Issuer.

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2.3.3 Form and Expiration of Letters of Credit. Each
Letter of Credit issued under this Section 2.3 and each draft accepted
or paid under such a Letter of Credit shall be issued, accepted or
paid, as the case may be, by the Letter of Credit Issuer at its
principal office. No Letter of Credit shall provide for the payment
of drafts drawn thereunder, and no draft shall be payable, at a date
which is later than the earlier of (a) the date twelve months after
the date of issuance or (b) 15 days prior to the Final Maturity Date
with respect to the Working Capital Loans. Each Letter of Credit and
each draft accepted under a Letter of Credit shall be in such form and
minimum amount, and shall contain such terms, as the Letter of Credit
Issuer and the Borrower may agree upon at the time such Letter of
Credit is issued, including a requirement of not less than three
Banking Days after presentation of a draft before payment must be made
thereunder.

2.3.4 Banks' Participation in Letters of Credit. Upon the
issuance of any Letter of Credit, a participation therein, in an
amount equal to each Bank's Percentage Interest, shall automatically
be deemed granted by the Letter of Credit Issuer to each Bank on the
date of such issuance and the Banks shall automatically be obligated,
as set forth in Section 10.4, to reimburse the Letter of Credit Issuer
to the extent of their respective Percentage Interests for all
obligations incurred by the Letter of Credit Issuer to third parties
in respect of such Letter of Credit not reimbursed by the Borrower.
The Letter of Credit Issuer will send to each Bank (and the
Administrative Agent if the Letter of Credit Issuer is not the
Administrative Agent) a confirmation regarding the participations in
Letters of Credit outstanding during such month.

2.3.5 Presentation. The Letter of Credit Issuer may accept
or pay any draft presented to it, regardless of when drawn and whether
or not negotiated, if such draft, the other required documents and any
transmittal advice are presented to the Letter of Credit Issuer and
dated on or before the expiration date of the Letter of Credit under
which such draft is drawn. Except insofar as instructions actually
received may be given by the Borrower in writing expressly to the
contrary with regard to, and prior to, the Letter of Credit Issuer's
issuance of any Letter of Credit for the account of the Borrower and
such contrary instructions are reflected in such Letter of Credit, to
the maximum extent permitted by law the Letter of Credit Issuer may
honor as complying with the terms of the Letter of Credit and with
this Agreement any drafts or other documents otherwise in order signed
or issued by an administrator, executor, conservator, trustee in
bankruptcy, debtor in possession, assignee for benefit of creditors,
liquidator, receiver or other legal representative of the party
authorized under such Letter of Credit to draw or issue such drafts or
other documents.

2.3.6 Payment of Drafts. At such time as a Letter of
Credit Issuer makes any payment on a draft presented or accepted under
a Letter of Credit, the Borrower will on demand pay to such Letter of
Credit Issuer in immediately available funds the amount of such
payment. Unless the Borrower shall otherwise pay to the Letter of
Credit Issuer the amount required by the foregoing sentence, such
amount shall be considered a loan under Section 2.2.1 and part of the
Working Capital Loan.

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2.3.7 Uniform Customs and Practice. The Uniform Customs
and Practice for Documentary Credits (1993 Revision), International
Chamber of Commerce Publication No. 500, and any subsequent revisions
thereof approved by a Congress of the International Chamber of
Commerce and adhered to by the Letter of Credit Issuer (the "Uniform
Customs and Practice"), shall be binding on the Borrower and the
Letter of Credit Issuer except to the extent otherwise provided
herein, in any Letter of Credit or in any other Loan Document.
Anything in the Uniform Customs and Practice to the contrary
notwithstanding:

(a) Neither the Borrower nor any beneficiary of any
Letter of Credit shall be deemed an agent of any Letter of Credit
Issuer.

(b) With respect to each Letter of Credit, neither any
Letter of Credit Issuer nor its correspondents shall be responsible,
except to the extent required by law, for or shall have any duty to
ascertain:

(i) the genuineness of any signature;

(ii) the validity, form, sufficiency, accuracy,
genuineness or legal effect of any endorsements;

(iii) delay in giving, or failure to give, notice
of arrival, notice of refusal of documents or of discrepancies
in respect of which any Letter of Credit Issuer refuses the
documents or any other notice, demand or protest;

(iv) the performance by any beneficiary under any
Letter of Credit of such beneficiary's obligations to the
Borrower;

(v) inaccuracy in any notice received by the
Letter of Credit Issuer;

(vi) the validity, form, sufficiency, accuracy,
genuineness or legal effect of any instrument, draft,
certificate or other document required by such Letter of
Credit to be presented before payment of a draft, or the
office held by or the authority of any Person signing any of
the same; or

(vii) failure of any instrument to bear any
reference or adequate reference to such Letter of Credit, or
failure of any Person to note the amount of any instrument on
the reverse of such Letter of Credit or to surrender such
Letter of Credit or to forward documents in the manner
required by such Letter of Credit.

(c) Except as otherwise required by law, the occurrence
of any of the events referred to in the Uniform Customs and Practice
or in the preceding clauses of this Section 2.3.7 shall not affect or
prevent the vesting of any of the Letter of Credit Issuer's rights or
powers hereunder or the Borrower's obligation to make reimbursement of
amounts paid under any Letter of Credit or any draft accepted
thereunder.

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(d) The Borrower will promptly examine (i) each Letter of
Credit (and any amendments thereof) sent to it by a Letter of Credit
Issuer and (ii) all instruments and documents delivered to it from
time to time by such Letter of Credit Issuer. The Borrower will
notify the Letter of Credit Issuer of any claim of noncompliance by
notice actually received within three Banking Days after receipt of
any of the foregoing documents, the Borrower being conclusively deemed
to have waived any such claim against such Letter of Credit Issuer and
its correspondents unless such notice is given. The Letter of Credit
Issuer shall have no obligation or responsibility to send any such
Letter of Credit or any such instrument or document to the Borrower.

(e) In the event of any conflict between the provisions
of this Agreement and the Uniform Customs and Practice and Article 5
of the Uniform Commercial Code, the provisions of this Agreement shall
govern to the maximum extent permitted by applicable law.

2.3.8 Subrogation. Subject to the terms of the
Intercreditor Agreement, upon any payment by a Letter of Credit Issuer
under any Letter of Credit and until the reimbursement of such Letter
of Credit Issuer by the Borrower with respect to such payment, the
Letter of Credit Issuer shall be entitled to be subrogated to, and to
acquire and retain, the rights which the Person to whom such payment
is made may have against the Borrower, all for the benefit of the
Banks. Subject to the terms of the Intercreditor Agreement, the
Borrower will take such action as the Letter of Credit Issuer may
reasonably request, including requiring the beneficiary of any Letter
of Credit to execute such documents as the Letter of Credit Issuer may
reasonably request, to assure and confirm to the Letter of Credit
Issuer such subrogation and such rights, including the rights, if any,
of the beneficiary to whom such payment is made in accounts
receivable, inventory and other properties and assets of the Borrower.

2.3.9 Modification, Consent, etc. If the Borrower requests
or consents in writing to any modification or extension of any Letter
of Credit, or waives any failure of any draft, certificate or other
document to comply with the terms of such Letter of Credit, and if the
Letter of Credit Issuer consents thereto, the Letter of Credit Issuer
shall be entitled to rely on such request, consent or waiver. This
Agreement shall be binding upon the Borrower with respect to such
Letter of Credit as so modified or extended, and with respect to any
action taken or omitted by such Letter of Credit Issuer pursuant to
any such request, consent or waiver.

2.4 Application of Proceeds.

2.4.1 Acquisition Loan. The Borrower will apply the
proceeds of the Acquisition Loan solely to finance acquisitions
permitted pursuant to Section 2.1 and to finance capital expenditures
for additions or improvements to the assets of the Borrower (as
distinguished from maintenance capital expenditures); provided, that
the amount of capital expenditures so financed in any fiscal year of
the Borrower shall not exceed $4,000,000.

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2.4.2 Working Capital Loan. The Borrower will apply the
proceeds of the Working Capital Loan for working capital and other
lawful purposes of the Borrower and its Subsidiaries, excluding,
however, purposes described in Section 2.4.1.

2.4.3 Letters of Credit. Letters of Credit shall be issued
only for lawful purposes of the Borrower and its Subsidiaries.

2.4.4 Specifically Prohibited Applications. The Borrower
will not, directly or indirectly, apply any part of the proceeds of
any extension of credit made pursuant to the Loan Documents to
purchase or to carry Margin Stock or to any transaction prohibited by
the Foreign Trade Regulations, by other Bank Legal Requirements of
applicable to the Banks or by the Loan Documents.

2.5 Nature of Obligations of Banks to Make Extensions of Credit.
The Banks' obligations to extend credit under this Agreement are several and
are not joint or joint and several. If on the date any Loans are to be made,
any Bank shall fail to perform its obligations under this Agreement, the
aggregate amount of Commitments to make the extensions of credit under this
Agreement shall be reduced by the amount of unborrowed Commitments of the Bank
so failing to perform and the Percentage Interests shall be appropriately
adjusted. Banks that have not failed to perform their obligations to make the
extensions of credit contemplated by Section 2 may, if any such Bank so
desires, assume, in such proportions as such Banks may agree, the obligations
of any Bank who has so failed and the Percentage Interests shall be
appropriately adjusted. The provisions of this Section 2.5 shall not affect
the rights of the Borrower against any Bank failing to perform its obligations
hereunder.

ARTICLE III

INTEREST; EURODOLLAR PRICING OPTIONS; FEES

3.1 Interest. Each Loan shall accrue and bear interest at a rate
per annum which shall at all times equal its Applicable Rate. Prior to any
stated or accelerated maturity of any Loan, the Borrower will, on the last day
of each month, commencing June 30, 1996, pay the accrued and unpaid interest on
the portion of such Loan which was not subject to a Eurodollar Pricing Option.
On the last day of each Eurodollar Interest Period or on any earlier
termination of any Eurodollar Pricing Option, the Borrower will pay the accrued
and unpaid interest on the portion of such Loan which was subject to the
Eurodollar Pricing Option which expired or terminated on such date. On the
Final Maturity Date or the earlier accelerated maturity of any Loan, the
Borrower will pay all accrued and unpaid interest on such Loan, including any
accrued and unpaid interest on any portion of such Loan which is subject to a
Eurodollar Pricing Option. Upon the occurrence and during the continuance of
an Event of Default, the Banks may require accrued interest to be payable on
demand or at regular intervals more frequent than each Payment Date. All
payments of interest hereunder shall be made to the Administrative Agent for
the account of each Bank in accordance with such Bank's Percentage Interest.

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3.2 Eurodollar Pricing Options.

3.2.1 Election of Eurodollar Pricing Options. Subject to
all of the terms and conditions hereof and so long as no Default
exists, the Borrower may from time to time, by irrevocable notice to
the Administrative Agent actually received not less than three Banking
Days prior to the commencement of the Eurodollar Interest Period
selected in such notice (except for the 10 Banking Days prior notice
required by Section 2.1.3.), elect to have such portion of a Loan as
the Borrower may specify in such notice accrue and bear interest
during the Eurodollar Interest Period so selected at the Applicable
Rate computed on the basis of the Eurodollar Rate. No such election
shall become effective:

(i) if, prior to the commencement of any such Eurodollar
Interest Period, the Administrative Agent determines that (i) the
electing or granting of the Eurodollar Pricing Option in question
would violate a Bank Legal Requirement, (ii) Eurodollar deposits in an
amount comparable to the principal amount of the Loan as to which such
Eurodollar Pricing Option has been elected and which have a term
corresponding to the proposed Eurodollar Interest Period are not
readily available in the inter-bank Eurodollar market, or (iii) by
reason of circumstances affecting the inter-bank Eurodollar market,
adequate and reasonable methods do not exist for ascertaining the
interest rate applicable to such deposits for the proposed Eurodollar
Interest Period; or

(ii) if any Bank shall have advised the Administrative
Agent by telephone or otherwise at or prior to noon (Boston time) on
the second Banking Day prior to the commencement of such proposed
Eurodollar Interest Period (and shall have subsequently confirmed in
writing) that, after reasonable efforts to determine the availability
of such Eurodollar deposits, such Bank reasonably anticipates that
Eurodollar deposits in an amount equal to the Percentage Interest of
such Bank in the portion of such Loan as to which such Eurodollar
Pricing Option has been elected and which have a term corresponding to
the Eurodollar Interest Period in question will not be offered in the
Eurodollar market to such Bank at a rate of interest that does not
exceed the anticipated Eurodollar Basic Rate.

3.2.2 Notice to Banks and Borrower. The Administrative
Agent will promptly inform each Bank (by telephone or otherwise) of
each notice received by it from the Borrower pursuant to Section 3.2.1
and of the Eurodollar Interest Period specified in such notice. Upon
determination by the Administrative Agent of the Eurodollar Rate for
such Eurodollar Interest Period or in the event such election shall
not become effective, the Administrative Agent will promptly notify
the Borrower and each Bank (by telephone or otherwise) of the
Eurodollar Rate so determined or why such election did not become
effective, as the case may be.

3.2.3 Selection of Eurodollar Interest Periods. Eurodollar
Interest Periods shall be selected so that:

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(i) the minimum portion of a Loan subject to any
Eurodollar Pricing Option shall be $1,000,000 and in integral multiple
of $100,000 in excess thereof;

(ii) no more than a total of four Eurodollar Pricing
Options shall be outstanding at any one time with respect to the
Loans;

(iii) no Eurodollar Interest Period with respect to any
part of a Loan subject to a Eurodollar Pricing Option shall expire
later than its applicable Final Maturity Date.

3.2.4 Additional Interest. If any portion of a Loan
subject to a Eurodollar Pricing Option is repaid, or any Eurodollar
Pricing Option is terminated for any reason (including acceleration of
maturity), on a date which is prior to the last Banking Day of the
Eurodollar Interest Period applicable to such Eurodollar Pricing
Option, the Borrower will pay to the Administrative Agent for the
account of each Bank in accordance with such Bank's Percentage
Interest, in addition to any amounts of interest otherwise payable
hereunder, an amount equal to the present value (calculated in
accordance with this Section 3.2.4) of interest for the unexpired
portion of such Eurodollar Interest Period on the portion of such Loan
so repaid, or as to which a Eurodollar Pricing Option was so
terminated, at a per annum rate equal to the excess, if any, of (a)
the rate applicable to such Eurodollar Pricing Option minus, (b) the
lowest rate of interest obtainable by the Administrative Agent upon
the purchase of debt securities customarily issued by the Treasury of
the United States of America which have a maturity date approximating
the last Banking Day of such Eurodollar Interest Period. The present
value of such additional interest shall be calculated by discounting
the amount of such interest for each day in the unexpired portion of
such Eurodollar Interest Period from such day to the date of such
repayment or termination at a per annum interest rate equal to the
interest rate determined pursuant to clause (b) of the preceding
sentence, and by adding all such amounts for all such days during such
period. The determination by the Administrative Agent of such amount
of interest shall, in the absence of manifest error, be conclusive.
For purposes of this Section 3.2.4, if any portion of a Loan which was
to have been subject to a Eurodollar Pricing Option is not outstanding
on the first day of the Eurodollar Interest Period applicable to such
Eurodollar Pricing Option other than for reasons described in Section
3.2.1, the Borrower shall be deemed to have terminated such Eurodollar
Pricing Option.

3.2.5 Violation of Bank Legal Requirements. If any Bank
Legal Requirement shall prevent any Bank from funding or maintaining
through the purchase of deposits in the interbank Eurodollar market
any portion of a Loan subject to a Eurodollar Pricing Option or
otherwise from giving effect to such Bank's obligations as
contemplated by Section 3.2, (a) the Administrative Agent may by
notice to the Borrower terminate all of the affected Eurodollar
Pricing Options, (b) the portion of such Loan subject to such
terminated Eurodollar Pricing Options shall immediately bear interest
thereafter at the Applicable Rate computed on the basis of the Base
Rate and (c) the Borrower shall make any payment required by Section
3.2.4.

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3.2.6 Funding Procedure. The Banks may fund any portion of
a Loan subject to a Eurodollar Pricing Option out of any funds
available to the Banks. Regardless of the source of the funds
actually used by any of the Banks to fund any portion of such Loan
subject to a Eurodollar Pricing Option, however, all amounts payable
hereunder, including the interest rate applicable to any such portion
of the Loan and the amounts payable under Sections 3.2.4, 3.5, 3.6,
3.7 and 3.8, shall be computed as if each Bank had actually funded
such Bank's Percentage Interest in such portion of such Loan through
the purchase of deposits in such amount of the type by which the
Eurodollar Basic Rate was determined with a maturity the same as the
applicable Eurodollar Interest Period relating thereto and through the
transfer of such deposits from an office of the Bank having the same
location as the applicable Eurodollar Office to one of such Bank's
offices in the United States of America.

3.3 Commitment Fees.

3.3.1 Acquisition Financing Facility. In consideration of
the Banks' Commitments to make the extensions of credit provided for
in Section 2.1, while such commitments are outstanding, the Borrower
will pay to the Administrative Agent for the account of the Banks in
accordance with the Banks' respective Percentage Interests, within
five (5) Banking Days of each Financial Statement Delivery Date prior
to the Acquisition Conversion Date and on the Acquisition Conversion
Date, an amount equal to interest computed at the rate per annum equal
to the Applicable Commitment Fee Percentage multiplied by the amount
by which (a) the average daily Maximum Amount of Acquisition Credit
during the Margin Period or portion thereof ending on such Financial
Statement Delivery Date or Acquisition Conversion Date exceeded (b)
the average daily Acquisition Loan during such Margin Period or
portion thereof.

3.3.2 Working Capital Facility. In consideration of the
Banks' commitments to make the extension of credit provided for in
Section 2.2 while such commitments are outstanding, the Borrower will
pay to the Administrative Agent for the account of the Banks in
accordance with the Banks' respective Percentage Interests, within
five (5) Banking Days of the Financial Statement Delivery Date and on
the Final Maturity Date with respect to the Working Capital Loan, an
amount equal to interest computed at the rate per annum equal to the
Applicable Commitment Fee Percentage multiplied by the amount by which
(a) the average daily Maximum Amount of Working Capital Credit during
the Margin Period or portion thereof ending on such Financial
Statement Delivery Date or Final Maturity Date exceeded (b) the
average daily Working Capital Loan during such Margin Period or
portion thereof.

3.4 Letter of Credit Fees. The Borrower will pay to the
Administrative Agent for the account of each of the Banks (including any Letter
of Credit Issuer), in accordance with the Banks' respective Percentage
Interests, on the last day of each Margin Period, a Letter of Credit fee equal
to the Applicable Margin for Eurodollar Loans in effect for such Margin Period
on the average daily Letter of Credit Exposure during such Margin Period;
provided, however, that a portion of such fee equal to 1/8% per annum on the
Letter of Credit Exposure shall be paid solely to the respective

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Letter of Credit Issuer. The Borrower also will pay to each Letter of Credit
Issuer customary service charges and expenses for its services in connection
with the Letters of Credit issued by it at the times and in the amounts from
time to time in effect in accordance with its general rate structure, including
fees and expenses relating to issuance, amendment, negotiation, cancellation
and similar operations.

3.5 Reserve Requirements, etc. If any Bank Legal Requirement
shall (a) impose, modify, increase or deem applicable any insurance assessment,
reserve, special deposit or similar requirement against any Funding Liability
or the Letters of Credit, (b) impose, modify, increase or deem applicable any
other requirement or condition with respect to any Funding Liability or the
Letters of Credit, or (c) change the basis of taxation of Funding Liabilities
or payments in respect of any Letter of Credit (other than changes in the rate
of taxes measured by the overall net income of such Bank) and the effect of any
of the foregoing shall be to increase the cost to any Bank of issuing, making,
funding or maintaining its respective Percentage Interest in any portion of a
Loan subject to a Eurodollar Pricing Option or any Letter of Credit, to reduce
the amounts received or receivable by such Bank under this Agreement or to
require such Bank to make any payment or forego any amounts otherwise payable
to such Bank under this Agreement, then, within 15 days after the receipt by
the Borrower of a certificate from such Bank setting forth why it is claiming
compensation under this Section 3.5 and computations (in reasonable detail) of
the amount thereof, the Borrower shall pay to the Administrative Agent for the
account of such Bank such additional amounts as are specified by such Bank in
such certificate as sufficient to compensate such Bank for such increased cost
or such reduction, together with interest at the Overdue Reimbursement Rate on
such amount from the 15th day after receipt of such certificate until payment
in full thereof; provided, however, that the foregoing provisions shall not
apply to any Tax or to any reserves which are included in computing the
Eurodollar Reserve Rate. The determination by such Bank of the amount of such
costs shall, in the absence of manifest error, be conclusive.

3.6 Taxes. All payments of the Credit Obligations shall be made
without set-off or counterclaim and free and clear of any deductions, including
deductions for Taxes, unless the Borrower is required by law to make such
deductions. If (a) any Bank shall be subject to any Tax with respect to any
payment of the Credit Obligations or its obligations hereunder or (b) the
Borrower shall be required to withhold or deduct any Tax on any payment on the
Credit Obligations, within 15 days after the receipt by the Borrower of a
certificate from such Bank setting forth why it is claiming compensation under
this Section 3.6 and computations (in reasonable detail) of the amount thereof,
the Borrower shall pay to the Administrative Agent for such Bank's account such
additional amount as is necessary to enable such Bank to receive the amount of
Tax so imposed on the Bank's obligations hereunder or the full amount of all
payments which it would have received on the Credit Obligations (including
amounts required to be paid under Sections 3.5, 3.7, 3.8 and this Section 3.6)
in the absence of such Tax, as the case may be, together with interest at the
Overdue Reimbursement Rate on such amount from the 15th day after receipt of
such certificate until payment in full thereof. Whenever Taxes must be
withheld by the Borrower with respect to any payments of the Credit
Obligations, the Borrower shall promptly furnish to the Administrative Agent
for the account of the applicable Bank official receipts (to the extent that
the relevant governmental authority delivers such receipts) evidencing payment
of any such Taxes so withheld. If the Borrower fails to pay any such Taxes
when due or fails to remit to the Administrative Agent for the account

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of the applicable Bank the required receipts evidencing payment of any such
Taxes so withheld or deducted, the Borrower shall indemnify the affected Bank
for any incremental Taxes and interest or penalties that may become payable by
such Bank as a result of any such failure. The determination by such Bank of
the amount of such Tax and the basis therefor shall, in the absence of manifest
error, be conclusive. The Borrower shall be entitled to replace any such Bank
in accordance with Section 11.3.

3.7 Capital Adequacy. If any Bank shall determine that compliance
by such Bank with any Bank Legal Requirement regarding capital adequacy of
banks or bank holding companies has or would have the effect of reducing the
rate of return on the capital of such Bank and its Affiliates as a consequence
of such Bank's commitment to make the extensions of credit contemplated hereby,
or such Bank's maintenance of the extensions of credit contemplated hereby, to
a level below that which such Bank could have achieved but for such compliance
(taking into consideration the policies of such Bank and its Affiliates with
respect to capital adequacy immediately before such compliance and assuming
that the capital of such Bank and its Affiliates was fully utilized prior to
such compliance) by an amount deemed by such Bank to be material, then, within
15 days after the receipt by the Borrower of a certificate from such Bank
setting forth why it is claiming compensation under this Section 3.7 and
computations (in reasonable detail) of the amount thereof, the Borrower shall
pay to the Administrative Agent for the account of such Bank such additional
amounts as shall be sufficient to compensate such Bank for such reduced return,
together with interest at the Overdue Reimbursement Rate on each such amount
from the 15th day after receipt of such certificate until payment in full
thereof. The determination by such Bank of the amount to be paid to it and the
basis for computation thereof shall, in the absence of manifest error, be
conclusive. In determining such amount, such Bank may use any reasonable
averaging, allocation and attribution methods. The Borrower shall be entitled
to replace any such Bank in accordance with Section 11.3.

3.8 Regulatory Changes. If any Bank shall determine that (a) any
change in any Bank Legal Requirement (including any new Bank Legal Requirement)
after the date hereof shall directly or indirectly (i) reduce the amount of any
sum received or receivable by such Bank with respect to a Loan or the Letters
of Credit or the return to be earned by such Bank on such Loan or the Letters
of Credit, (ii) impose a cost on such Bank or any Affiliate of such Bank that
is attributable to the making or maintaining of, or such Bank's commitment to
make, its portion of such Loan or the Letters of Credit, or (iii) require such
Bank or any Affiliate of such Bank to make any payment on, or calculated by
reference to, the gross amount of any amount received by such Bank under any
Credit Document, and (b) such reduction, increased cost or payment shall not be
fully compensated for by an adjustment in the Applicable Rate or the Letter of
Credit fees, then, within 15 days after the receipt by the Borrower of a
certificate from such Bank setting forth why it is claiming compensation under
this Section 3.8 and computations (in reasonable detail) of the amount thereof,
the Borrower shall pay to such Bank such additional amounts as such Bank
determines will, together with any adjustment in the Applicable Rate, fully
compensate for such reduction, increased cost or payment, together with
interest on such amount from the 15th day after receipt of such certificate
until payment in full thereof at the Overdue Reimbursement Rate. The
determination by such Bank of the amount to be paid to it and the basis for
computation thereof hereunder shall, in the absence of

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manifest error, be conclusive. In determining such amount, such Bank may use
any reasonable averaging and attribution methods.

3.9 Computations of Interest and Fees. For purposes of this
Agreement, interest, commitment fees and Letter of Credit fees (and any other
amount expressed as interest or such fees) shall be computed on the basis of a
360-day year for actual days elapsed. If any payment required by this
Agreement becomes due on any day that is not a Banking Day, such payment shall,
except as otherwise provided in the Eurodollar Interest Period, be made on the
next succeeding Banking Day. If the due date for any payment of principal is
extended as a result of the immediately preceding sentence, interest shall be
payable for the time during which payment is extended at the Applicable Rate,
but any letter of credit fees payable pursuant to Section 3.4 shall not be
increased as a result of such extension.

3.10 Closing Fees. In further consideration of the execution and
delivery of this Agreement by the Banks, on the Initial Closing Date the
Borrower will pay to the Administrative Agent for the account of the Banks
alone a closing fee in the amount of $490,000.

3.11 Administrative Agent's Fees. On the Initial Closing Date and
on each other date provided therein, the Borrower shall pay to the
Administrative Agent, for the Administrative Agent's own account, a fee in an
amount and payable in a manner to be mutually agreed in a separate writing
between the Borrower and the Administrative Agent (as from time to time in
effect, the "Administrative Agent Fee Letter").

3.12 Documentation Agent's Fees. On the Initial Closing Date and
on each other date provided therein, the Borrower shall pay to the
Documentation Agent, for the Agent's own account, a fee in an amount and
payable in a manner to be mutually agreed in a separate writing between the
Borrower and the Facilitating Agent (as from time to time in effect, the
"Documentation Agent Fee Letter").

ARTICLE IV

PAYMENT

4.1 Payment at Maturity. On the Final Maturity Date with respect
to each Tranche or any accelerated maturity of such Loan, the Borrower will pay
to the Administrative Agent for the account of the Banks an amount equal to the
remaining aggregate principal amount of such Tranche then outstanding, together
with all accrued and unpaid interest thereon and all other Credit Obligations
then outstanding.

4.2 Contingent Required Prepayments.

4.2.1 Excess Credit Exposure. If at any time the
Acquisition Loan (prior to the Acquisition Conversion Date) or the
Working Capital Loan exceeds the limit set forth in

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Section 2.1.2 or 2.2.2, respectively, the Borrower shall within three
Banking Days pay the amount of such excess to the Administrative Agent
for the account of the Banks.

4.2.2 Letter of Credit Exposure. If at any time the Letter
of Credit Exposure exceeds the limit set forth in Section 2.3.1, the
Borrower shall within three Banking Days pay the amount of such excess
to the Administrative Agent for the account of the Banks to be applied
as provided in Section 4.5.

4.2.3 Contingent Prepayments on Disposition, Loss of
Assets, Merger or Change of Control.

(i) If at any time the Borrower or any of its
Subsidiaries disposes of assets or issues or sells Capital Stock of
any Subsidiary with the result that there are Excess Sale Proceeds,
and the Borrower does not apply such Excess Sale Proceeds in the
manner described in Section 7B.7(iii)(c)(II)(x), the Borrower will
prepay (at the price of the principal amount prepaid plus accrued
interest thereon and any amount owing with respect thereto under
Section 3.2.4 and upon notice as provided in Section 4.2.4) a
principal amount of the outstanding Acquisition Notes equal to the
Allocable Proceeds.

(ii) In the event of any damage to, or destruction,
condemnation or other taking of, all or any portion of the properties
or assets of the Borrower or any of its Subsidiaries, to the extent
that the Borrower or any such Subsidiary receives insurance or
condemnation proceeds with the result that Unutilized Taking Proceeds
exceed $2,500,000 in respect of any fiscal year (such excess amount
being herein called "Excess Taking Proceeds"), the Borrower will
prepay (at the price of the principal amount prepaid plus accrued
interest thereon and any amount owing with respect thereto under
Section 3.2.4 and upon notice as provided in Section 4.2.4) a
principal amount of the outstanding Acquisition Notes equal to the
Allocable Proceeds.

(iii) (a) If at any time any Responsible Officer has
knowledge of the occurrence of any Control Event, the Borrower will
give notice as provided in Section 4.4 of such Control Event to the
Administrative Agent. Upon the occurrence of a Control Event, the
Borrower will not take any voluntary action that consummates or
finalizes the Control Event resulting from such Control Event unless
contemporaneously with such action, the Borrower prepays all Notes in
accordance with this Section 4.2.3(iii) and upon notice as provided in
Section 4.2.4 at the price of the principal amount thereof plus
accrued interest thereon and any amount owing with respect thereto
under Section 3.2.4.

(b) The obligation of the Borrower to prepay Acquisition
Notes pursuant to the offer required by paragraph (a) of this clause
(iii) and accepted in accordance with Section 4.2.4 is subject to the
consummation of the Control Event in respect of which any such offer
and acceptance shall have been made. In the event that such Control
Event does not occur on or before the proposed prepayment date in
respect thereof, the prepayment shall be deferred until and shall be
made on the date on which such Control Event occurs. The

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Borrower shall keep the Administrative Agent reasonably and timely
informed of (I) any such deferral of the date of prepayment, (II) the
date on which such Control Event and the prepayment are expected to
occur, and (III) any determination by the Borrower that efforts to
effect such resulting Control Event have ceased or been abandoned (in
which case the Borrower shall have no further obligation hereunder to
prepay the Acquisition Notes in respect of such Control Event).

4.2.4 Prepayment Procedure for Contingent Prepayments.

(i) If at any time there are unapplied Excess Sale
Proceeds or Excess Taking Proceeds (such unapplied amounts being
"Excess Proceeds"), and the Borrower is required to prepay the
Acquisition Notes with such Excess Proceeds pursuant to clause (i) or
(ii) of Section 4.2.3, the Borrower will give written notice as
provided in Section 12.1 (which shall be in the form of an Officers'
Certificate) to the Banks not later than twelve months after the date
of the applicable Asset Sale or the end of the twelve month period
following receipt of the applicable Unutilized Taking Proceeds, as the
case may be, and (a) setting forth in reasonable detail all
calculations required to determine the amount of Excess Proceeds, (b)
setting forth the aggregate amount of the Allocable Proceeds and the
amount of the Allocable Proceeds which is allocable to each
Acquisition Note, determined by applying the Allocable Proceeds pro
rata among all Acquisition Notes outstanding on the date such
prepayment is to be made according to the aggregate then unpaid
amounts of the Acquisition Notes, and in reasonable detail the
calculations used in determining such amounts, and (c) stating that
the Borrower will prepay on the date specified in such notice, which
shall not be less than 25 nor more than 45 days after the date of such
notice, a principal amount of each outstanding Acquisition Note equal
to the amount of Allocable Proceeds allocated to such Acquisition Note
as described in clause (b) above.

(ii) If at any time the Borrower is required to prepay the
Notes following the occurrence of a Control Event, the Borrower will
give written notice as provided in Section 12.1 (which shall be in the
form of an Officer's Certificate) to the Banks not later than five
Business Days following such Control Event, (a) setting forth in
reasonable detail the facts and circumstances underlying such Control
Event known to it, and (b) stating that the Borrower will prepay on
the date the Control Event occurs.

4.3 Scheduled Required Payments/Prepayments.

4.3.1 Payments on the Acquisition Loan. On each Payment
Date occurring after the Acquisition Conversion Date, the Borrower
shall pay 1/10th of the Acquisition Loan outstanding on the
Acquisition Conversion Date, after giving effect to all prepayments
thereon; provided, however, on the Final Maturity Date of the
Acquisition Loan, the Borrower shall pay all outstanding principal of
the Acquisition Loan.

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4.3.2 Working Capital Loan. The Borrower shall prepay the
Working Capital Loan when necessary to comply with the Annual Clean-Up
requirement set forth in the proviso to Section 2.2.2.

4.4 Voluntary Prepayments. In addition to the prepayments
required by Sections 4.2 and 4.3, the Borrower may from time to time prepay all
or any portion of the Loans (in a minimum amount of $100,000 and an integral
multiple of $50,000), without premium or penalty of any type (except as
provided in Section 3.2.4 with respect to the early termination of Eurodollar
Pricing Options). The Borrower shall give the Administrative Agent at least
one Banking Day prior notice of its intention to prepay, specifying the date of
payment, the total amount of the Loans to be paid on such date and the amount
of interest to be paid with such prepayment.

4.5 Letters of Credit. If on the stated or any accelerated
maturity of the Credit Obligations the Banks shall be obligated in respect of a
Letter of Credit or a draft accepted under a Letter of Credit, the Borrower
will either:

(a) prepay such obligation by depositing with the
Administrative Agent an amount of cash, or

(b) deliver to the Administrative Agent a standby letter
of credit (designating the Administrative Agent as beneficiary and
issued by a bank and on terms reasonably acceptable to the
Administrative Agent),

in each case in an amount equal to the portion of the then Letter of Credit
Exposure issued for the account of the Borrower. Any such cash so deposited
and the cash proceeds of any draw under any standby letter of credit so
furnished, including any interest thereon, shall be returned by the
Administrative Agent to the Borrower only when, and to the extent that, the
amount of such cash held by the Administrative Agent exceeds the Letter of
Credit Exposure at a time when no Default exists; provided, however, that if an
Event of Default occurs and the Credit Obligations become or are declared
immediately due and payable, the Administrative Agent may apply such cash,
including any interest thereon, to the payment of any of the Credit Obligations
as provided in the Intercreditor Agreement.

4.6 Reborrowing Application of Payments, etc.

4.6.1 Reborrowing. The amounts of the Acquisition Loan and
the Working Capital Loan prepaid pursuant to Section 4.2.1, 4.2.3(i)
or (ii), 4.3.2 or 4.4 may be reborrowed from time to time, in the case
of the Acquisition Loan prior to the Acquisition Conversion Date in
accordance with Section 2.1 and in the case of the Working Capital
Loan prior to its Final Maturity Date, in accordance with Section 2.2
and subject to the limits set forth therein. No portion of the
Acquisition Loan prepaid hereunder after the Acquisition Conversion
Date may be reborrowed.

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4.6.2 Order of Application. Each prepayment of the Loan
made pursuant to Section 4.2.1 shall be applied to the Working Capital
Loan or the Acquisition Loan, as appropriate. Each prepayment of the
Loan made pursuant to Section 4.2.3(i) or (ii) shall be applied to the
Acquisition Loan. Any amounts of the Acquisition Loan prepaid after
the Acquisition Conversion Date pursuant to the preceding sentence may
not be reborrowed. Each prepayment of the Acquisition Loan pursuant
to Section 4.2.3(i) or (ii) after the Acquisition Conversion Date
shall be applied to the outstanding principal balance of such Tranche
in the inverse order of the required prepayments provided in Section
4.3.1.

4.6.3 Payment with Accrued Interest, etc. Upon all
prepayments of a Loan, the Borrower shall pay to the Administrative
Agent the principal amount to be prepaid, together with unpaid
interest in respect thereof accrued to the date of prepayment and any
amount owing with respect thereto under Section 3.2.4. Notice of
prepayment having been given in accordance with Section 4.4, and
whether or not notice is given of prepayments pursuant to Sections 4.2
and 4.3, the amount specified to be prepaid shall become due and
payable on the date specified for prepayment.

4.6.4 Payments for Banks. All payments of principal
hereunder shall be made to the Administrative Agent for the account of
the Banks in accordance with the Banks' respective Percentage
Interests.

ARTICLE V

SECURITY

5.1 Collateral. The repayment of the Indebtedness shall be
secured by the Collateral as more particularly described and defined in the
Security Documents.

The Borrower hereby acknowledges that all of the Collateral is granted
as security for the repayment of all Indebtedness evidenced by the Notes, the
Private Placement Notes and the notes, if any, evidencing other Parity Debt.
If one or more of such notes are paid in full or satisfied, but any portion of
the Indebtedness evidenced by such note remains unsatisfied, the Collateral
Agent may retain its security interest in all of the Collateral on behalf of
the Secured Parties described therein until the remaining Indebtedness secured
thereby is paid in full, even if the value of the Collateral far exceeds the
amount of such outstanding Indebtedness secured thereby.

5.2 Intercreditor Agreement. The Banks and the Documentation
Agent hereby authorize the Administrative Agent to execute and deliver the
Intercreditor Agreement to the Collateral Agent.

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ARTICLE VI

CONDITIONS PRECEDENT AND SUBSEQUENT TO LOANS

6.1 Conditions Precedent to Initial Working Capital Loan and
Initial Acquisition Loan. The obligation of the Banks to make the initial
Working Capital Loan and the initial Acquisition Loan is subject to the
satisfaction of all of the following conditions on or prior to the Initial
Closing Date (in addition to the other terms and conditions set forth herein):

(i) No Default. There shall exist no Event of Default,
Noncompliance Event or Default on the Initial Closing Date.

(ii) Representations and Warranties. The representations,
warranties and covenants set forth in Article VIII shall be true and
correct on and as of the Initial Closing Date, with the same effect as
though made on and as of the Initial Closing Date unless such
representation or warranty relates only to an earlier date.

(iii) Certificates. The Borrower shall have delivered to
the Agents Certificates, dated as of the Initial Closing Date, and
signed by the President or Vice President and the Secretary of the
General Partner and of Heritage, respectively, certifying (a) to the
matters covered by the conditions specified in subsections (i) and
(ii) of this Section 6.1, (b) that the Borrower and Heritage have
performed and complied with all agreements and conditions required to
be performed or complied with by them prior to or on the Initial
Closing Date, (c) to the name and signature of each officer of the
general partner of the Borrower and of Heritage authorized to execute
and deliver the Loan Documents and any other documents, certificates
or writings and to borrow under this Agreement, and (iv) to such other
matters in connection with this Agreement which the Banks shall
determine to be advisable. The Banks may conclusively rely on such
Certificates until Agent receives notice in writing to the contrary.

(iv) Proceedings. On or before the Initial Closing Date,
all partnership proceedings of the Borrower shall be taken in
connection with the transactions contemplated by the Loan Documents
and shall be satisfactory in form and substance to the Banks and
Agents' counsel; and the Agents shall have received certified copies,
in form and substance satisfactory to the Banks and Agents' counsel,
of the partnership agreements and certificates of the Borrower and the
Articles or Certificates of Incorporation and By-Laws of the General
Partner and the resolutions of the Board of Directors of the general
partner of the Borrower, as adopted, authorizing the execution and
delivery of the Loan Documents, the borrowings under this Agreement,
and the granting of the security interests in the Collateral pursuant
to the Security Agreement, to secure the payment of the Indebtedness.

(v) Notes. The Borrower shall have delivered the Notes
payable to the order of the respective Banks, to the Administrative
Agent, in each case appropriately executed.

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(vi) Security Agreement. The Borrower shall have
delivered to the Collateral Agent the Security Agreement,
appropriately executed by the Borrower and Heritage, and dated as of
the Closing Date, together with such financing statements (UCC or
otherwise) (collectively, the "Financing Statements"), and other
documents as shall be necessary and appropriate to perfect the
Collateral Agent's security interests in the Collateral covered by
said Security Agreement, including, without limitation, the Security
Agreement, and such certificates representing shares of Capital Stock
included in the Collateral and proper stock powers with respect
thereto duly endorsed in blank (collectively, the "Certificates and
Stock Powers").

(vii) Private Placement Notes and Common Units Closings.
The transactions and closing contemplated by (i) the Note Purchase
Agreement, including without limitation, all of the Conditions of
Closing in Sections 3.A through 3.M, inclusive, of the Note Purchase
Agreement, shall have been consummated and the Private Placement Notes
duly issued in accordance with the terms, provisions and conditions of
the Note Purchase Agreement and (ii) the Registration Statement shall
have been duly consummated and the Common Units purchased in
accordance with the terms, provisions and conditions of the
Underwriting Agreement described and defined in the Note Purchase
Agreement.

(viii) Opinions of Borrower's Counsel. The Agents shall
have received from Borrower's counsel, Doerner, Saunders, Xxxxxx &
Xxxxxxxx, as well as certain local counsel pertaining to the
Collateral, favorable written closing opinions addressed to the Agents
and the Banks, satisfactory in form and substance to the Banks and
Agents' counsel. In addition, the Agents shall have received from
Xxxxxxx & Xxxxx L.L.P., reliance letters on their opinion delivered
pursuant to the Underwriting Agreement referred to in clause (vii) and
certain portions of their opinion delivered to the purchasers of the
Private Placement Notes.

(ix) UCC Releases/Other Information. The Administrative
Agent shall have received a written payoff statement from any other
secured party of record concerning any of the Collateral together with
applicable UCC terminations of record of all such existing security
interest liens pertaining to the Collateral or any part thereof.

(x) Fees. The Borrower shall have paid to the
Administrative Agent for the account of the Banks in accordance with
the Percentage Interests the sum of $500,000 representing loan
origination fees on the Working Capital Facility and Acquisition
Facility as required by Section 3.4 above and to each of the Agents
all amounts required to be paid on the Initial Closing Date pursuant
to the Administrative Agent Fee Letter and the Documentation Fee Agent
Letter, respectively.

(xi) Other Information and Closing Documents. The
Administrative Agent shall have received such other consents,
information, documents, agreements and assurances as shall be
reasonably requested by the Banks, including, without limitation,
appropriate consents and approvals to the issuance of the Notes, the
Private Placement Notes the

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Common Units and the Commitments and the Intercreditor Agreement shall
have been duly executed by all parties thereto and delivered to the
Collateral Agent.

6.2 Conditions Precedent to All Loans. The Banks shall not be
obligated to make any additional Loan advance(s) or to issue any Letters of
Credit after the Initial Closing Date (i) if at such time any Event of Default
or any Noncompliance Event shall have occurred or any Default shall have
occurred and be continuing; or (ii) if any of the representations, warranties
and covenants contained in Article VIII of this Agreement shall be false or
untrue in any material respect on the date of such advance or issue, as if made
on such date (unless such representation or warranty relates only to an earlier
date). Each request by the Borrower for an additional Working Capital Loan or
Acquisition Loan shall constitute a representation by the Borrower that there
is not at the time of such request an Event of Default, a Noncompliance Event
or a Default, and that all representations, warranties and covenants in Article
VIII of this Agreement are true and correct on and as of the date of each such
applicable Loan request or request for a Letter of Credit.

ARTICLE VII

COVENANTS

The Borrower hereby covenants and agrees with the Banks that, comply
with the terms and provisions of this Article VII.

7A. Affirmative Covenants.

7A.1 Financial Statements. The Borrower will maintain, and will
cause each of its Subsidiaries to maintain, a system of accounting established
and administered in accordance with GAAP. The Borrower covenants that it will
deliver to each Bank:

(i) as soon as practicable and in any event within 50
days after the end of each quarterly period in each fiscal year,
consolidated statements of income, partners' capital and cash flows of
the Borrower and its Subsidiaries for such quarterly period and (in
the case of the second, third and fourth quarterly periods) for the
period from the beginning of the current fiscal year to the end of
such quarterly period, and consolidated balance sheets of the Borrower
and its Subsidiaries as at the end of such quarterly period, setting
forth in each case with respect to financial statements delivered as
of any date and for any period after August 31, 1997, in comparative
form figures for the corresponding period in the preceding fiscal
year, all in reasonable detail and satisfactory in form to the
Required Banks and certified by an authorized financial officer of the
Borrower as presenting fairly, in all material respects, the
information contained therein (except for the absence of footnotes and
subject to changes resulting from normal year-end adjustments), in
accordance with GAAP; provided, however, that at any time when the
Master Partnership shall be subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act delivery within the time
period specified above of copies of the Quarterly Report on Form 10-Q
of the Master Partnership for such quarterly

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period filed with the Commission shall be deemed to satisfy the
requirements of this clause (i) if (x) the Consolidated Net Income of
the Borrower and its Subsidiaries accounts for at least 95% of the net
income of the Master Partnership for such quarterly period, and (y)
all such statements required to be delivered pursuant to this clause
(i) with respect to the Borrower and its Subsidiaries are either
included or are included in such Form 10-Q or delivered separately by
the Borrower together with such Form 10-Q;

(ii) as soon as practicable and in any event within 95
days after the end of each fiscal year, consolidated and consolidating
statements of income and cash flows and a consolidated and
consolidating statement of partners' capital (or stockholders' equity,
as applicable) of the Borrower and its Subsidiaries for such year, and
consolidated and consolidating balance sheets of the Borrower and its
Subsidiaries, as at the end of such year, setting forth in each case
with respect to financial statements delivered as of any date and for
any period after August 31, 1997, in comparative form corresponding
consolidated and, where applicable, consolidating figures from the
preceding annual audit, all in reasonable detail and, as to the
consolidated statements, reported on by Xxxxxx Xxxxxxxx LLP, or other
independent public accountants of recognized national standing
selected by the Borrower whose report shall be without limitation as
to the scope of the audit and, as to the consolidating statements,
certified by an authorized financial officer of the Borrower as
presenting fairly, in all material respects, the information contained
therein, in accordance with GAAP (except, in the case of such
consolidating financial statements, for the absence of footnotes);
provided, however, that at any time when the Master Partnership shall
be subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act delivery within the time period specified above of copies
of the Annual Report on Form 10-K of the Master Partnership for such
fiscal year prepared in compliance with the requirements therefor and
filed with the Commission shall be deemed to satisfy the requirements
of this clause (ii) if (x) the Consolidated Net Income of the Borrower
and its Subsidiaries accounts for at least 95% of the net income of
the Master Partnership for such fiscal year, and (y) all such
statements required to be delivered pursuant to this clause (ii) with
respect to the Borrower and its Subsidiaries are either included in
such Form 10-K and such reports or delivered separately by the
Borrower together with such Form 10-K and such reports;

(iii) promptly upon receipt thereof by the Borrower, copies
of all reports submitted to the Borrower by independent public
accountants in connection with each special, annual or interim audit
of the books of the Borrower or any Subsidiary thereof made by such
accountants, including without limitation the comment letter submitted
by each such accountant to management in connection with their annual
audit;

(iv) promptly upon transmission thereof, copies of (a) all
financial statements, proxy statements, notices and reports as the
Borrower or the Master Partnership shall send or make available to the
public Unitholders of the Master Partnership, (b) all registration
statements (without exhibits), all prospectuses and all reports which
the Borrower or the Master Partnership files with the Commission (or
any governmental body or agency succeeding to the functions of the
Commission), (c) all press releases and other similar

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written statements made available by the Borrower or the Master
Partnership to the public concerning material developments in the
business of the Borrower or the Master Partnership, as the case may
be, and (d) all reports, notices and other similar written statements
sent or made available by the Borrower or the Master Partnership to
any holder of its Indebtedness pursuant to the terms of any agreement,
indenture or other instrument evidencing such Indebtedness, including
without limitation the Credit Agreement, except to the extent the same
substantive information is already being provided pursuant to this
Section 7A.1;

(v) as soon as reasonably practicable, and in any event
within 5 Business Days after a Responsible Officer obtains knowledge
that any Default or Event of Default has occurred, a written statement
of such Responsible Officer setting forth details of such Default or
Event of Default and the action which the Borrower has taken, is
taking and proposes to take with respect thereto;

(vi) as soon as reasonably practicable, and in any event
within 5 Business Days after a Responsible Officer obtains knowledge
of (a) the occurrence of an adverse development with respect to any
litigation or proceeding involving the Borrower or any of its
Subsidiaries which in the reasonable judgment of the Borrower could
reasonably be expected to have a Material Adverse Effect or (b) the
commencement of any litigation or proceeding involving the Borrower or
any of its Subsidiaries which in the reasonable judgment of the
Borrower could reasonably be expected to have a Material Adverse
Effect, a written notice of such Responsible Officer describing in
reasonable detail such commencement of, or adverse development with
respect to, such litigation or proceeding;

(vii) as soon as possible after, and in any event within 10
Business Days after any Responsible Officer of the Borrower or any
ERISA Affiliate knows or has reason to know that, any ERISA Event has
occurred or is expected to occur that, alone or together with any
other ERISA Events that have occurred, in the opinion of the principal
financial officer of the Borrower could reasonably be expected to
result in liability of the Borrower in an aggregate amount exceeding
$2,000,000, a statement setting forth a detailed description of such
ERISA Event and the action, if any, that the Borrower or any ERISA
Affiliate has taken, is taking or proposes to take or cause to be
taken with respect thereto (together with a copy of any notice, report
or other written communication filed with or given to or received from
the PBGC, the Internal Revenue Service or the Department of Labor with
respect to such event or condition);

(viii) as soon as reasonably practicable, and in any event
within five Business Days after a Responsible Officer obtains
knowledge of a violation or alleged violation of any Environmental Law
or the presence or release of any Hazardous Substance within, on,
from, relating to or affecting any property, which in the reasonable
judgment of the Borrower could reasonably be expected to have a
Material Adverse Effect, notice thereof, and upon request, copies of
relevant documentation;

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(ix) together with each delivery of financial information
pursuant to clause (i) or clause (ii) of this Section 7A.1, a
statement setting forth, together with computations in reasonable
detail, the amount of Available Cash as of the date of the balance
sheet contained therein and the amounts of all Net Proceeds, Excess
Sale Proceeds, Unutilized Taking Proceeds and Unused Proceeds Reserves
held by the Borrower at the end of the applicable quarterly period or
fiscal year, as the case may be;

(x) as soon as reasonably practicable, and in any event
within 5 Business Days after a Responsible Officer obtains knowledge
that the holder of any Note has given any notice to the Borrower or
any Subsidiary thereof or taken any other action with respect to a
claimed Default or Event of Default under this Agreement or any other
Loan Documents, or that any Person has given any notice to the
Borrower or any such Subsidiary or taken any other action with respect
to a claimed default or event or condition of the type referred to in
[Section 9.1A(iii), Event of Default] a written statement of such
Responsible Officer describing such notice or other action in
reasonable detail and the action which the Borrower has taken, is
taking and proposes to take with respect thereto;

(xi) prior to the Closing Date and within 45 days after
the end of each calendar year ending thereafter, commencing with the
year ending December 31, 1996, a report prepared by the Borrower or
its broker or agent (a) setting forth the insurance maintained
pursuant to Section 7A.8, substantially in the form delivered on the
Closing Date and referred to in Section 6.1k, and including, without
limitation, the amounts thereof, the names of the insurers and the
property, hazards and risks covered thereby, and certifying that all
premiums with respect to the policies described in such report then
due thereon have been paid and that the same are in full force and
effect, (b) setting forth all self-insurance maintained by the
Borrower pursuant to Section 7A.8 and (c) certifying that such
insurance or self insurance complies with the requirements of such
Section 7A.8; and

(xii) with reasonable promptness, such other information
and data (financial or other) as from time to time may be reasonably
requested by any Bank.

Together with each delivery of financial statements required by clauses (i) and
(ii) above, the Borrower will deliver to each holder of Notes an Officers'
Certificate (I) stating that the signers have reviewed the terms of this
Agreement and the other Loan Documents, and have made, or caused to be made
under their supervision, a review in reasonable detail of the transactions and
condition of the Borrower and its Subsidiaries during the accounting period
covered by such financial statements, and that no Default or Event of Default
has occurred and is continuing, or, if any such Default or Event of Default
then exists, specifying the nature and approximate period of existence thereof
and what action the Borrower has taken or is taking or proposes to take with
respect thereto, (II) specifying the amount available at the end of such
accounting period for Restricted Payments in compliance with Section 7B.6 and
showing in reasonable detail all calculations required in arriving at such
amount, (III) demonstrating (with computations in reasonable detail) compliance
at the end of such accounting period by the Borrower and its Subsidiaries with
the provisions of Sections 4.6, 7B.1, 7B.2, 7B.3, 7B.4, 7B.5(v), 7B.7(i)(b),
7B.7(i)(c), 7B.7(iii) and 7B.12, and (IV) if not specified

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in the related financial statements being delivered pursuant to clauses (i) and
(ii) above, specifying the aggregate amount of interest paid or accrued by, and
aggregate rental expenses of, the Borrower and its Subsidiaries, and the
aggregate amount of depreciation, depletion and amortization charged on the
books of the Borrower and its Subsidiaries, during the fiscal period covered by
such financial statements.

Together with each delivery of financial statements required by clause
(ii) above, the Borrower will deliver a certificate of such accountants stating
that they have reviewed the terms of this Agreement and the other Loan
Documents and that in making the audit necessary for their report on such
financial statements, they have obtained no knowledge of any Event of Default
or Default, or, if they have obtained knowledge of any Event of Default or
Default, specifying the nature and period of existence thereof. Such
accountants, however, shall not be liable to anyone by reason of their failure
to obtain knowledge of any Event of Default or Default which would not be
disclosed in the course of an audit conducted in accordance with generally
accepted auditing standards.

7A.2 Inspection of Property. The Borrower will permit any Person
designated in writing by any holder of the Notes which is an institutional
investor, at the Borrower's expense during the continuance of a Default or
Event of Default and otherwise at such holder's expense, to visit and inspect
any of the properties of the Borrower and its Subsidiaries, to examine the
corporate books and financial records of the Borrower and its Subsidiaries and
make copies thereof or extracts therefrom and to discuss the affairs, finances
and accounts of any of such partnerships or corporations with the principal
officers of the Borrower and its independent public accountants, all at such
reasonable times and as often as such holder may reasonably request. The
Borrower hereby authorizes, and agrees to cause each of its Subsidiaries to
authorize, its and their independent public accountants to discuss with such
Person the affairs, finances and accounts of the Borrower and its Subsidiaries
in accordance with this Section 7A.2.

7A.3 Covenant to Secure Notes Equally. If the Borrower or any of
its Subsidiaries shall create or assume any Lien upon any of its property or
assets, whether now owned or hereafter acquired, other than Liens permitted by
the provisions of Sections 7B.3 and 7B.4 (unless prior written consent to the
creation or assumption thereof shall have been obtained pursuant to Section
10.6), the Borrower will make or cause to be made effective provision whereby
the Notes will be contemporaneously secured by such Lien equally and ratably
with any and all other Indebtedness thereby secured so long as any such other
Indebtedness shall be so secured (including, without limitation, the provision
of any financial accommodations extended to the holders of such other
Indebtedness in connection with the release of such Lien and/or the sale of any
property subject thereto), it being understood that the provision of such equal
and ratable security shall not constitute a cure or waiver of any related Event
of Default.

7A.4 Partnership or Corporate Existence, etc.; Compliance with
Laws.

(i) Except as otherwise expressly permitted in accordance with
Section 7B.7 or 7B.11, (a) the Borrower will at all times preserve and keep in
full force and effect its partnership existence and its status as a partnership
not taxable as a corporation for U.S. federal income tax purposes, (b)

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the Borrower will cause each of its Subsidiaries to keep in full force and
effect its partnership or corporate existence, as the case may be, and (c) the
Borrower will, and will cause each of its Subsidiaries to, at all times
preserve and keep in full force and effect all of its material rights and
franchises; provided, however, that the partnership or corporate existence of
any Subsidiary, and any right or franchise of the Borrower or any Subsidiary,
may be terminated notwithstanding this Section 7A.4 if such termination (x) is
in the best interest of the Borrower and the Subsidiaries, (y) is not
disadvantageous to the holders of the Notes in any material respect and (z)
could not reasonably be expected to have a Material Adverse Effect.

(ii) The Borrower will, and will cause each of its Subsidiaries to,
at all times comply with all laws, regulations and statutes (including without
limitation any zoning or building ordinances or code or Environmental Laws)
applicable to it except for any failure to so comply which, individually or in
the aggregate, could not reasonably be expected to have a Material Adverse
Effect.

(iii) The Borrower will notify the Bank a reasonable time prior to
the adoption of any amendment to the Partnership Agreement, the Note Purchase
or any Operative Agreement and will include in that notice a reasonably
detailed description of such amendment and the intended effects thereof.

7A.5 Payment of Taxes and Claims. The Borrower will, and will
cause each of its Subsidiaries to, pay all taxes, assessments and other
governmental charges imposed upon it or any of its Subsidiaries, or any of its
or its Subsidiaries' properties or assets or in respect of any of its or any of
its Subsidiaries' franchises, business, income or profits when the same become
due and payable, and all claims (including without limitation claims for labor,
services, materials and supplies) for sums which have become due and payable
and which by law have or might become a Lien upon any of its or any of its
Subsidiaries' properties or assets; provided that no such tax, assessment,
charge or claim need be paid if it is being contested in good faith by
appropriate proceedings promptly initiated and diligently conducted and if such
reserves or other appropriate provision, if any, as shall be required by GAAP
shall have been made therefor and be adequate in the good faith judgment of the
Board of Directors of the General Partner.

7A.6 Compliance with ERISA. The Borrower will, and will cause its
Subsidiaries to, comply in all material respects with the provisions of ERISA
and the Code applicable to the Borrower and its Subsidiaries and their
respective employee benefit programs.

7A.7 Maintenance and Sufficiency of Properties.

(i) The Borrower will maintain or cause to be maintained in good
repair, working order and condition, ordinary wear and tear excepted, all
properties used in the business of the Borrower and its Subsidiaries and from
time to time will make or cause to be made all appropriate repairs, renewals
and replacements thereof, all to the extent necessary to avoid a Material
Adverse Effect.

(ii) The Borrower will maintain and will cause to be maintained as
employees of the Borrower and its Subsidiaries such number of individuals,
having appropriate skills, as may be

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necessary from time to time to sustain continuous operation of the Business at
the time. Except as described on Schedule 8.8 the Borrower will continue and
will cause its Subsidiaries to continue to own or have valid rights to use all
of the Assets constituting personal or intellectual property (including without
limitation computer equipment, computer software and other intellectual
property) reasonably necessary for the operation of the Business, in each case
subject to no Liens except such as are permitted by Section 7B.3.

7A.8 Insurance.

(i) The Borrower will, and will cause its Subsidiaries to, at its
or their expense, at all times maintain, or cause to be maintained, with
financially sound and reputable insurers, insurance with respect to their
properties and business with coverages comparable to those generally carried by
companies of similar size that conduct the same or similar business and have
similar properties in the same general areas in which the Borrower conducts its
business; provided, however, that the Borrower may maintain a system of
self-insurance in an amount not exceeding an amount as is customary for
companies with established reputations engaged in the same or similar business
and owning and operating similar properties.

(ii) The Borrower will, and will cause each of its Subsidiaries to,
pay as and when the same become due and payable the premiums for all insurance
policies that the Borrower and its Subsidiaries are required to maintain
hereunder.

7A.9 Environmental Laws. The Borrower will, and will cause each of
its Subsidiaries to:

(i) comply with all applicable Environmental Laws and any permit,
license, or approval required under any Environmental Law, except for failures
to so comply which could not reasonably be expected to have a Material Adverse
Effect;

(ii) store, use, release, or dispose of any Hazardous Substance at
any property owned or leased by the Borrower or any of its Subsidiaries in a
manner which could not reasonably be expected to have a Material Adverse
Effect;

(iii) avoid committing any act or omission which would cause any
Lien to be asserted against any property owned by the Borrower or any of its
Subsidiaries pursuant to any Environmental Law, except where such Lien could
not reasonably be expected to have a Material Adverse Effect;

(iv) use, handle or store any propane in compliance, in all
material respects, with all applicable laws.

7A.10 Operative Agreements. The Borrower will perform and comply
with all of its obligations under each of the Operative Agreements to which it
is a party, will enforce each such Operative Agreement against each other party
thereto and will not accept the termination of any such Operative Agreement or
any amendment or supplement thereof or modification or waiver

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thereunder, unless any such failure to perform, comply or enforce or any such
acceptance could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.

7A.11 After-Acquired Property. From and after the date of the
Closing, the Borrower will, and will cause each of its Subsidiaries to, execute
and deliver such amendments to the Security Agreement, execute and deliver such
instruments and agreements (including, without limitation, such Certificates
and Stock Powers) and execute and cause to be duly recorded, published,
registered or filed in the appropriate jurisdictions such Financing Statements,
as shall be necessary to grant to the Collateral Agent a valid, perfected,
first priority security interest, subject to Liens permitted by the Security
Agreement in any asset acquired by the Borrower or any Subsidiary of the
Borrower (including, without limitation, the Capital Stock of any Subsidiary)
after the Closing, to the extent such asset would have been included in the
Collateral granted at the Closing had the Borrower or one of its Subsidiaries
owned such asset as of the Closing. The Borrower will pay or cause to be paid
all taxes, fees and other governmental charges in connection with the
execution, delivery, recording, publishing, registration and filing of such
documents and instruments in such places.

7A.12 Further Assurances. At any time and from time to time
promptly, the Borrower shall, at its expense, execute and deliver to each Bank
and the Collateral Agent such instruments and documents, and take such further
action, as the holders of the Notes may from time to time reasonably request,
in order to further carry out the intent and purpose of this Agreement and the
other Loan Documents and to establish, perfect, preserve and protect the
rights, interests and remedies created, or intended to be created, in favor of
the Banks, and including, without limitation, the execution and delivery of
Certificates and the delivery of Stock Powers and the execution, delivery,
recordation and filing of Financing Statements and continuation statements
under the Uniform Commercial Code of any applicable jurisdiction, and the
delivery of satisfactory opinions of counsel.

7A.13 Books and Accounts. The Borrower will, and will cause each of
its Subsidiaries to, maintain proper books of record and account in which full,
true and proper entries shall be made of its transactions and set aside on its
books from its earnings for each fiscal year all such proper reserves as in
each case shall be required in accordance with GAAP.

7A.14 Available Cash Reserves. The Borrower will maintain an amount
of 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 Borrower and its Subsidiaries (including reserves for future capital
expenditures) 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 the Borrower or any Subsidiary is a party or
by which it is bound or its assets are subject (including the Loan Documents)
and (iii) provide funds for distributions to partners of the Master Partnership
and the General Partner in respect of any one or more of the next four
quarters; provided that the General Partner need not establish cash reserves
pursuant to clause (iii) if the effect of such reserves would be that the
Master Partnership is unable to distribute the Minimum Quarterly Distribution
(as defined in the Agreement of Limited Partnership of the Master Partnership)
on all Common Units with respect to such quarter; and provided, further, that
disbursements made by the Borrower or a

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Subsidiary of the Borrower 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. In addition, without
limiting the foregoing, Available Cash for any fiscal quarter shall reflect
cash reserves equal to (x) 50% of the interest projected to be paid on the
Private Placement Notes in the next succeeding fiscal quarter, plus (y)
beginning with a date three fiscal quarters before a scheduled principal
payment date on the Private Placement Notes, 25% of the aggregate principal
amount thereof due on any such payment date in the third succeeding fiscal
quarter, 50% of the aggregate principal amount due on any such payment date in
the second succeeding fiscal quarter and 75% of the aggregate principal amount
due on any quarterly payment date in the next succeeding fiscal quarter, plus
(z) the Unused Proceeds Reserve as of the date of determination; provided that
the foregoing reserves for amounts to be paid on the Private Placement Notes
shall be reduced by the aggregate amount of advances available to the Borrower
from responsible financial institutions under binding, irrevocable (a) credit
or financing commitments (which are subject to no conditions which the Borrower
is unable to meet) and (b) letters of credit (which are subject to no
conditions which the Borrower is unable to meet), in each case to be used to
refinance such amounts to the extent such amounts could be borrowed and remain
outstanding under Sections 7B.2(ii) and 7B.2(iii).

7A.15 Parity Debt.

(i) The Borrower shall ensure that the lenders from time to time
in respect of any outstanding Parity Debt shall, in the documents governing the
terms of such Indebtedness, (a) recognize the existence and validity of the
obligations represented by the Notes and (b) agree to refrain from making or
asserting any claim that the Loan Documents or the obligations represented by
the Notes are invalid or not enforceable in accordance with its and their terms
as a result of the circumstances surrounding the incurrence of such
obligations.

(ii) Each Bank and each other Person that becomes a Bank, as
evidenced by its acceptance of its Notes, (a) acknowledges the existence and
validity of the obligations of the Borrower and Heritage under the Note
Purchase Agreement (and any replacement, extension, renewal, refunding or
refinancing thereof permitted by Section 7B.2, as the case may be) and (b)
agrees to refrain from making or asserting any claim that such obligations or
the instruments governing the terms thereof are invalid or not enforceable in
accordance with its and their terms as a result of the circumstances
surrounding the incurrence of such obligations.

7B. Negative Covenants.

7B.1 Financial Ratios.

(i) Ratio of Consolidated EBITDA to Consolidated Interest Expense.
The Borrower will not permit the ratio as of the last day of any fiscal quarter
of the Borrower of Consolidated EBITDA to Consolidated Interest Expense to be
less than (a) 2 to 1 prior to the first anniversary of the Initial Closing Date
or (b) 2.25 to 1 on or after the first anniversary of the Initial Closing Date;

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(ii) Ratio of Consolidated Funded Indebtedness to Consolidated
EBITDA. The Borrower will not permit the ratio as of the last day of any
fiscal quarter of Consolidated Funded Indebtedness to Consolidated EBITDA to
exceed (a) 5.25 to 1 on any date on or prior to August 31, 1997, (b) 5 to 1 on
any date after August 31, 1997 and on or prior to August 31, 1998, (c) 4.75 to
1 on any date after August 31, 1998 and on or prior to February 28, 1999 and
(d) 4.5 to 1 on any date after February 28, 1999;

Notwithstanding any of the provisions of this Agreement the Borrower
will not, and will not permit any Subsidiary to, enter into any transaction
pursuant to Section 7B.2, clauses (vii), (viii) and (xiv)(b) of Section 7B.3,
Section 7B.6, of clauses (i)(b), (i)(c), (ii)(b) and (iii) of Section 7B.7, (x)
if after giving effect to any such transaction a Noncompliance Event, Default
or Event of Default exists or (y) if the consummation of any such transaction
would result in a violation of any clause of this Section 7B.1 or a
Noncompliance Event, calculated for such purpose as of the date on which such
transaction were to be consummated both immediately before and after giving
effect to the consummation thereof; provided, however, that in the case of
transactions pursuant to Section 7B.7, the calculation shall be made on a pro
forma basis in accordance with GAAP after giving effect to any such
transaction, with the ratio recomputed as at the last day of the most recently
ended fiscal quarter of the Borrower as if such transaction had occurred on the
first day of the relevant four quarter period.

7B.2 Indebtedness. The Borrower will not, and will not permit any
of its Subsidiaries to, create, incur, assume, or otherwise become directly or
indirectly liable with respect to, any Indebtedness, except (subject to the
provisions of Section 7B.4):

(i) the Borrower may become and remain liable with respect to
Indebtedness evidenced by the Notes and Indebtedness incurred in connection
with any extension, renewal, refunding or refinancing of Indebtedness evidenced
by the Private Placement Notes, provided that the principal amount of such
Indebtedness shall not exceed the principal amount of the Indebtedness
evidenced by the Private Placement Notes, together with any accrued interest
and Yield Maintenance Amount with respect thereto, being extended, renewed,
refunded or refinanced and (y) such Indebtedness may not have an average life
to maturity shorter than the remaining average life to maturity of the
Indebtedness being extended, renewed, refunded or refinanced;

(ii) the Borrower may become and remain liable with respect to
Indebtedness incurred under the Working Capital Facility and any Indebtedness
incurred for such purpose which replaces, extends, renews, refunds or
refinances all of such Indebtedness (in the case of a replacement, refunding or
refinancing, so long as the Acquisition Facility also is replaced, refunded or
refinanced in whole; provided that the aggregate principal amount of
Indebtedness permitted under this clause (ii) shall not at any time exceed an
amount equal to (x) $15,000,000 less (y) the amount of Indebtedness, if any,
outstanding under the revolving working capital facility permitted by clause
(v) of this Section 7B.2;

(iii) the Borrower may become and remain liable with respect to
Indebtedness incurred by the Borrower under the Acquisition Facility and any
Indebtedness incurred for such purpose

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which replaces, extends, renews, refunds or refinances all of such Indebtedness
(in the case of a replacement refunding or refinancing, so long as the Working
Capital Facility also is replaced, refunded or refinanced in whole); provided
that the aggregate principal amount of Indebtedness permitted under this clause
(iii) shall not at any time exceed the lesser of $35,000,000 or the aggregate
Acquisition Loan Commitments described in Section 10.1, as amended from time to
time;

(iv) any Subsidiary of the Borrower may become and remain liable
with respect to Indebtedness of such Subsidiary owing to the Borrower or to a
Wholly-Owned Subsidiary of the Borrower;

(v) Heritage Service Corp. may become and remain liable with
respect to Indebtedness incurred under a revolving working capital facility and
any Indebtedness incurred for any permitted purpose which replaces, extends,
renews, refunds or refinances any such Indebtedness, in whole or in part;
provided that the aggregate principal amount of Indebtedness permitted under
this clause (v) shall not at any time exceed $1,000,000;

(vi) the Borrower and any of its Subsidiaries may become and remain
liable with respect to Indebtedness relating to any business, property or
assets acquired by or contributed to the Borrower or such Subsidiary or which
is secured by a loan on any property or assets acquired by or contributed to
the Borrower or such Subsidiary to the extent such Indebtedness existed at the
time such business, property or assets were so acquired or contributed, and if
such Indebtedness is secured by such property or assets, such security interest
does not extend to or cover any other property of the Borrower or any of its
Subsidiaries; provided that (a) immediately after giving effect to such
acquisition or contribution, the Borrower could incur at least $1.00 of
additional Indebtedness pursuant to clause (xiii) of this Section 7B.2 and (b)
such Indebtedness was not incurred in anticipation of such acquisition or
contribution;

(vii) the Company and any of its Subsidiaries may become and remain
liable with respect to Indebtedness arising from the honoring by a bank or
other financial institution of a check, draft or similar instrument drawn
against insufficient funds in the ordinary course of business, provided that
such Indebtedness is extinguished within 2 Business Days of its incurrence;

(viii) M-P Oils Partnership may become and remain liable with respect
to Indebtedness in an aggregate principal amount not to exceed $3,000,000, and
the Borrower may become and remain liable with respect to Guarantees of such
Indebtedness of M-P Oils Partnership and of Indebtedness of Bi State Propane,
provided that the aggregate amount of all Guarantees permitted by this clause
(viii) shall not exceed $5,000,000;

(ix) the Borrower may become and remain liable with respect to
Guarantees of the Indebtedness of Bi State Propane and M P Oils Partnership
permitted by clause (v) of this Section 7B.2;

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(x) any Person that after the Closing Date becomes a Subsidiary of
the Borrower may become and remain liable with respect to any Indebtedness to
the extent such Indebtedness existed at the time such Person became a
Subsidiary; provided that (a) immediately after giving effect to such Person
becoming a Subsidiary of the Borrower, the Borrower could incur at least $1.00
of additional Indebtedness in compliance with clause (xiii) of this Section
7B.2 and (b) such Indebtedness was not incurred in anticipation of such Person
becoming a Subsidiary of the Borrower;

(xi) the Borrower and any of its Subsidiaries may become and remain
liable with respect to Indebtedness owed to any person providing workers'
compensation, health, disability or other employee benefits or property,
casualty or liability insurance to the Borrower or any of its Subsidiaries,
pursuant to reimbursement or indemnification obligations to such person;

(xii) the Borrower and any of its Subsidiaries may become and remain
liable with respect to Indebtedness in respect of performance bonds, bid bonds,
appeal bonds, surety bonds and similar obligations, in each case provided in
the ordinary course of business, including those incurred to secure health,
safety and environmental obligations in the ordinary course of business, and
any extension, renewal or refinancing thereof to the extent not provided to
secure the repayment of other Indebtedness and to the extent that the amount of
refinancing Indebtedness is not greater than the amount of Indebtedness being
refinanced;

(xiii) the Borrower may become and remain liable with respect to
Indebtedness incurred in respect of Capitalized Lease Obligations; provided,
that the Lien in respect thereof is permitted by clause (viii) of Section 7B.3;
and

(xiv) the Borrower and its Subsidiaries may become and remain liable
with respect to unsecured Indebtedness not exceeding $2,000,000 in aggregate
principal amount at any time outstanding, in addition to that otherwise
permitted by the other clauses of this Section 7B.2, if on the date the
Borrower or any of its Subsidiaries becomes liable with respect to any such
additional Indebtedness and immediately after giving effect thereto and to the
substantially concurrent repayment of any other Indebtedness (a) the ratio of
Consolidated EBITDA to Consolidated Debt Service is equal to or greater than
2.50 to 1.0 and (b) the ratio of Consolidated EBITDA to Consolidated Pro Forma
Maximum Debt Service is equal to or greater than 1.25 to 1.0 and (c) no
Default, Event of Default or Noncompliance Event shall exist.

7B.3 Liens. The Borrower will not, and will not permit any of its
Subsidiaries to, create, assume, incur or suffer to exist any Lien upon or with
respect to any of its properties or assets, whether now owned or hereafter
acquired, or any income or profits therefrom (whether or not provision is made
for the equal and ratable securing of the Notes in accordance with the
provisions of Section 7A.3), except:

(i) Liens existing on the Initial Closing Date hereof on the
property and assets of the Borrower or any of its Subsidiaries as described in
Schedule 7B.3;

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(ii) Liens for taxes, assessments or other governmental charges the
payment of which is not yet due and payable or the validity of which is being
contested in good faith in compliance with Section 7A.5;

(iii) attachment or judgment Liens not giving rise to an Event of
Default and with respect to which the underlying action has been appealed or is
being contested in good faith in compliance with Section 7A.5;

(iv) Liens of lessors, landlords, carriers, vendors, mechanics,
materialmen, warehousemen, repairmen and other like Liens incurred in the
ordinary course of business the payment of which is not yet due or which is
being contested in good faith in compliance with Section 7A.5, in each case not
incurred or made in connection with the borrowing of money, the obtaining of
advances or credit or the payment of the deferred purchase price of property,
provided that such Liens do not materially interfere with the conduct of the
business of the Borrower and its Subsidiaries taken as a whole;

(v) Liens (other than any Lien imposed by ERISA) incurred and
pledges and deposits made in the ordinary course of business (a) in connection
with workers' compensation, unemployment insurance, old age pensions, retiree
health benefits and other types of social security, or (b) to secure (or to
obtain letters of credit that do not constitute Indebtedness and that secure)
the performance of tenders, statutory obligations, surety and appeal bonds,
bids, leases, performance bonds, contracts and other similar obligations, in
each case not incurred or made in connection with the borrowing of money or the
obtaining of advances or credit provided that such Liens do not materially
interfere with the conduct of the business of the Borrower and its Subsidiaries
taken as a whole;

(vi) zoning restrictions, easements, licenses, reservations,
provisions, covenants, conditions, waivers, restrictions on the use of property
or irregularities of title (and with respect to leasehold interests, mortgages,
obligations, liens and other encumbrances incurred, created, assumed or
permitted to exist and arising by, through or under a landlord or owner of the
leased property, with or without consent of the lessee) which do not in the
aggregate materially detract from the value of its property or assets or
materially impair the use thereof in the operation of its business;

(vii) Liens existing on any property of a Person at the time such
Person becomes a Subsidiary of the Borrower or existing at the time of
acquisition upon any property acquired by the Borrower or any of its
Subsidiaries at the time such property is so acquired, through purchase, merger
or consolidation or otherwise (whether or not the Indebtedness secured thereby
shall have been assumed); provided, however, that in the case of any such Lien
(1) such Lien shall at all times be confined solely to any such property and,
if required by the terms of the instrument creating such Lien, other property
which is an improvement to such acquired property, (2) such Lien was not
created in anticipation of such transaction, and (3) the Indebtedness secured
by such Lien shall be permitted under Section 7B.2;

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(viii) Liens created to secure all or any part of the purchase price,
or to secure Indebtedness (other than Parity Debt) incurred or assumed to pay
all or any part of the purchase price or cost of construction, of property
acquired or constructed by the Borrower or any of its Subsidiaries after the
Closing Date or to secure obligations incurred in consideration of non-compete
agreements ("Non-Compete Obligations") entered into in connection with any such
acquisition, including an acquisition complying with clause (b)(y) of Section
7B.9; provided that (a) any such Lien shall be confined solely to the item or
items of such property (or improvement thereon) so acquired or constructed and,
if required by the terms of the instrument creating such Lien, other property
(or improvement thereon) which is an improvement to such acquired or
constructed property (and, in the case of any Lien securing Non-Compete
Obligations, shall also be limited to (x) such items of property as acquired
which are not of the character included in the definition of Collateral and (y)
such additional items of the property so acquired, having a total fair market
value (as determined in good faith by the Board of Directors of the General
Partner) for the sum of (x) and (y) that is not more than the amount of the
Non-Compete Obligations so secured), (b) such item or items of property so
acquired and subject to such Lien are not required to become part of the
Collateral under the terms of the Security Agreement, (c) any such Lien shall
be created contemporaneously with, or within 180 days after, the acquisition or
construction of such property, and (d) such Lien does not exceed an amount
equal to 85% of the fair market value (100% in the case of Capitalized Lease
Obligations and 35% in the case of Non-Compete Obligations) of such property
(as determined in good faith by the Board of Directors of the General Partner)
at the time of acquisition thereof and (e) after giving effect to such Lien no
Noncompliance Event, Default or Event of Default shall exist; provided,
however, that the aggregate principal amount at any time outstanding of
Indebtedness secured by Liens permitted by this Section 7B.3(viii) shall not
exceed $10,000,000;

(ix) Liens on property or assets of any Subsidiary of the Borrower
securing Indebtedness of such Subsidiary owing to the Borrower or a
Wholly-Owned Subsidiary;

(x) leases or subleases of equipment to customers which do not
materially interfere with the conduct of the business of the Borrower and its
Subsidiaries taken as a whole;

(xi) easements, exceptions or reservations in any property of the
Borrower or any Subsidiary granted or reserved for the purpose of pipelines,
roads, the removal of oil, gas, coal or other minerals, and other like
purposes, or for the joint or common use of real property, facilities and
equipment, which are incidental to, and do not materially interfere with, the
ordinary conduct of the business of the Borrower or any of its Subsidiaries;

(xii) Liens (other than Liens securing Indebtedness) on the property
or assets of any Subsidiary of the Borrower in favor of the Borrower or any
other Wholly-Owned Subsidiary of the Borrower;

(xiii) Liens on the property or assets of Heritage Service Corp.
securing the Indebtedness permitted by clause (v) of Section 7B.2 provided that
(a) any such Lien shall at all times be contained to property or assets having
an aggregate fair market value not exceeding $2,000,000 and (b) such
indebtedness permitted by clause (v) of Section 7B.2 is owed to one or more of
the Banks;

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(xiv) Liens created by any of the Security Documents securing (a)
Indebtedness evidenced by the Notes, the Acquisition Credit or the Working
Capital Credit) and (b) Additional Parity Debt; and

(xv) any Lien renewing, extending or refunding any Lien permitted
by this Section 7B.3, provided that (a) the principal amount of the
Indebtedness secured by any such Lien shall not exceed the principal amount of
such Indebtedness outstanding immediately prior to the renewal, extension or
refunding of such Lien and (b) no assets encumbered by any such Lien other than
the assets encumbered immediately prior to such renewal, extension or refunding
shall be encumbered thereby.

Notwithstanding the foregoing, the Borrower will not, and will not
permit any of its Subsidiaries to, create, assume or incur any Lien upon or
with respect to (a) any Subsidiary stock held by the Borrower or any other
Subsidiary of the Borrower, or (b) any of its proprietary software developed by
or on behalf of the Borrower or its Affiliates necessary and useful for the
conduct of the Business. No Lien permitted under this Section 7B.3 shall
result in over-collateralization except as required by conventional practice
for specific types of borrowings.

7B.4 Priority Debt. The Borrower will not permit Priority Debt, at
any time, to exceed the sum of (i) $5,000,000 plus (ii) 10% of the then
Consolidated Tangible Net Worth of the Borrower and its Subsidiaries(but only
to the extent such Consolidated Tangible Net Worth is positive). The
provisions of this Section 7B.4 are further limitations on Priority Debt that
shall otherwise be permitted by Section 7B.1, 7B.2 or 7B.3.

7B.5 Loans, Advances, Investments and Contingent Liabilities. The
Borrower will not, and will not permit any of its Subsidiaries to, directly or
indirectly, purchase or own any stock, obligations or securities of, or any
other interest in, or make any capital contribution to, any Person, make or
permit to remain outstanding any loan or advance to, or guarantee, endorse or
otherwise be or become contingently liable, directly or indirectly, in
connection with the obligations of any Person, or make any other Investment,
except:

(i) the Borrower or any of its Subsidiaries may make and own
Investments (w) consisting of Units issued for purposes of making acquisitions,
(x) arising out of loans and advances to employees incurred in the ordinary
course of business, and consisting of advances to pay reimbursable
expenditures, (y) arising out of extensions of trade credit or advances to
third parties in the ordinary course of business and (z) acquired by reason of
the exercise of customary creditors' rights upon default or pursuant to the
bankruptcy, insolvency or reorganization of a debtor;

(ii) Guarantees that constitute Indebtedness to the extent
permitted by Sections 7B.1 and 7B.2 and other Guarantees that are not
Guarantees of Indebtedness and are undertaken in the ordinary course of
business;

(iii) investment in (collectively, "Cash Equivalents")

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(a) marketable obligations issued or unconditionally
guaranteed by the United States of America, or issued by any agency
thereof and backed by the full faith and credit of the United States
of America, in each case maturing one year or less from the date of
acquisition thereof,

(b) marketable direct obligations issued by any state of
the United States of America or any political subdivision of any such
state or any public instrumentality thereof maturing within one year
from the date of acquisition thereof and having as at such date the
highest rating obtainable from either Standard & Poor's Rating Group
or Xxxxx'x Investors Service, Inc.,

(c) commercial paper maturing no more than 270 days from
the date of creation thereof and having as at the date of acquisition
thereof one of the two highest ratings obtainable from either Standard
& Poor's Rating Group or Xxxxx'x Investors Service, Inc.,

(d) certificates of deposit maturing one year or less
from the date of acquisition thereof (1) issued by commercial banks
incorporated under the laws of the United States of America or any
state thereof or the District of Columbia or Canada or issued by the
United States branch of any commercial bank organized under the laws
of any country in Western Europe or Japan, with capital and
stockholders' equity of at least $500,000,000 (or the equivalent in
the currency of such country), (A) the commercial paper or other short
term unsecured debt obligations of which are as at such date rated
either A-2 or better (or comparably if the rating system is changed)
by Standard & Poor's Rating Group or Prime-2 or better (or comparably
if the rating system is changed) by Xxxxx'x Investors Service, Inc. or
(B) the long-term debt obligations of which are as at such date rated
either A or better (or comparably if the rating system is changed) by
Standard & Poor's Rating Group or A2 or better (or comparably if the
rating system is changed) by Xxxxx'x Investors Service,
Inc.("Permitted Banks") or (2) issued by BOk in an aggregate amount
for all such certificates of deposit issued by BOk not to exceed
$1,000,000,

(e) Eurodollar time deposits having a maturity of less
than 270 days from the date of acquisition thereof purchased directly
from any Permitted Bank,

(f) bankers' acceptances eligible for rediscount under
requirements of The Board of Governors of the Federal Reserve System
and accepted by Permitted Banks, and

(g) obligations of the type described in clause (a), (b),
(c), (d) or (e) above purchased from a securities dealer designated as
a "primary dealer" by the Federal Reserve Bank of New York or from a
Permitted Bank as counterparty to a written repurchase agreement
obligating such counterparty to repurchase such obligations not later
than 14 days after the purchase thereof and which provides that the
obligations which are the subject thereof are held for the benefit of
the Borrower or any of its Subsidiaries by a custodian which is a
Permitted Bank and which is not a counterparty to the repurchase
agreement in question;

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(iv) the Borrower or any of its Subsidiaries may acquire Capital
Stock or other ownership interests of a Person (i) located in the United States
of America or Canada, (ii) incorporated or otherwise formed pursuant to the
laws of the United States of America or Canada or any state or province thereof
or the District of Columbia and (iii) engaged in substantially the same
business as the Borrower which Person at the time of such acquisition is, or as
a result thereof becomes, a Subsidiary of the Borrower;

(v) the Borrower or any of its Subsidiaries may make and own
Investments (in addition to Investments permitted by clauses (i), (ii), (iii),
and (iv) of this Section 7B.5) in any Person incorporated or otherwise formed
pursuant to the laws of the United States of America or Canada or any state or
province thereof or the District of Columbia; provided, however, that (i) the
sum of (a) the aggregate amount of all such Investments made by the Borrower
and its Subsidiaries following the Closing Date which are outstanding pursuant
to this clause (v) plus (b) all other Investments held by the Borrower and its
Subsidiaries which are outstanding as of the Closing Date and listed on
Schedule 7B.5 shall not at any date of determination exceed $10,000,000 (the
"Investment Limit"); (ii) the representation in Section 8.18 shall be true and
correct as of the date of determination; and (iii) the aggregate amount of all
such Investments made by the Borrower and its Subsidiaries and outstanding
pursuant to this clause (v) in Persons engaged in a business which is not
substantially the same as a line of business described in Section 7B.8 shall
not at any date exceed $3,000,000 and (iv) no Investment pursuant to this
clause (v) may be made unless if after giving effect thereto no Default or
Event of Default exists;

(vi) the Borrower may make and become liable with respect to any
Interest Rate Agreements; and

(vii) any Subsidiary of the Borrower may make Investments in the
Borrower or in a Wholly-Owned Subsidiary of the Borrower.

7B.6 Restricted Payments. The Borrower will not directly or
indirectly declare, order, pay, make or set apart any sum for any Restricted
Payment, except that the Borrower may declare or order, and make, pay or set
apart, during each fiscal quarter a Restricted Payment if (i) such Restricted
Payment together with all other Restricted Payments during such fiscal quarter,
do not in the aggregate exceed the amount of Available Cash with respect to the
immediately preceding quarter, and (ii) no Default, Event of Default or
Noncompliance Event exists before or immediately after any such proposed
action.

7B.7 Consolidation, Merger, Sale of Assets, etc. The Borrower will
not, and will not permit any of its Subsidiaries to, directly or indirectly,

(i) consolidate with or merge into any other Person or permit any
other Person to consolidate with or merge into it, except that:

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(a) any Subsidiary of the Borrower may consolidate with
or merge into the Borrower or a Wholly-Owned Subsidiary of the
Borrower if the Borrower or a Wholly-Owned Subsidiary of the Borrower,
as the case may be, shall be the surviving Person; and

(b) any entity (other than a Subsidiary of the Borrower)
may consolidate with or merge into the Borrower or a Subsidiary if the
Borrower or a Subsidiary of the Borrower, as the case may be, shall be
the surviving Person and if, immediately after giving effect to such
transaction, (I) the Borrower and its Subsidiaries (x) shall not have
a Consolidated Net Worth, determined in accordance with GAAP applied
on a basis consistent with the consolidated financial statements of
the Borrower most recently delivered pursuant to Section 7A.1, of less
than the Consolidated Net Worth of the Borrower immediately prior to
the effectiveness of such transaction, satisfaction of this
requirement to be set forth in reasonable detail in an Officers'
Certificate delivered to each holder of a Note at the time of such
transaction, and (y) could incur at least $1.00 of additional
Indebtedness in compliance with Section 7B.1 and clause (xiv) of
Section 7B.2, (II) substantially all of the assets of the Borrower and
its Subsidiaries, taken as a whole, shall be located and substantially
all of their business shall be conducted within the continental United
States of America or Canada and (III) no Default, Event of Default or
Noncompliance Event shall exist and be continuing;

(ii) sell, lease, abandon or otherwise dispose of all or
substantially all its assets, except that any Subsidiary of the Borrower may
sell, lease or otherwise dispose of all or substantially all its assets to the
Borrower or to a Wholly-Owned Subsidiary of the Borrower; or

(iii) sell, lease, convey, abandon or otherwise dispose of
(including, without limitation, in connection with a Sale and Lease-Back
Transaction) any of its assets (except in a transaction permitted by clause
(i)(a), (i)(b), (i)(c), (ii)(a) or (ii)(b) of this Section 7B.7 or sales of
inventory in the ordinary course of business consistent with past practice) or
issue or sell Capital Stock of any Subsidiary of the Borrower, whether in a
single transaction or a series of related transactions (each of the foregoing
non-excepted transactions, an "Asset Sale"), unless:

(a) immediately after giving effect to such proposed
disposition no Default, Event of Default or Noncompliance Event shall
exist and be continuing, satisfaction of this requirement to be set
forth in reasonable detail in an Officer's Certificate delivered to
each holder of a Note at the time of such transaction in the case of
any Asset Sale involving assets that generates EBITDA and such Asset
Sale involves consideration of $250,000 or more;

(b) such sale or other disposition is for cash
consideration or for consideration consisting of not less than 75%
cash and not more than 25% interest-bearing promissory notes;
provided, that the 75% limitation referred to in this clause (b)
shall not apply to any Asset Sale consisting solely of a sale or other
disposition of land and buildings for an interest bearing promissory
note as long as the amount of such promissory note does not exceed
$250,000;

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(I) (x) the aggregate Net Proceeds of all assets
so disposed of (whether or not leased back) over the
immediately preceding 12-month period does not exceed
$3,000,000 and (y) the aggregate Net Proceeds of all assets so
disposed of (whether or not leased back) from the Closing Date
through the date of such disposition does not exceed
$10,000,000; or

(II) in the event that such Net Proceeds (less the
amount thereof previously applied in accordance with clause
(x) of this clause (c)(II)) exceeds the limitations determined
pursuant to clauses (x) and (y) of clause (c)(I) of this
Section 7B.7 (such excess amount being herein called "Excess
Sale Proceeds"), the Borrower shall within 12 calendar months
of the date on which such Net Proceeds exceeded any such
limitation, cause an amount equal to such Excess Sale Proceeds
to be applied (x) to the acquisition of assets in replacement
of the assets so disposed of or of assets which may be
productively used in the United States of America or Canada in
the conduct of the Business, or (y) to the extent not applied
pursuant to the immediately preceding clause (x), to offer to
make prepayments on the Notes pursuant to Section 4.2.3 hereto
and, allocated on the basis specified for such prepayments in
the definition of Allocable Proceeds, to offer to repay other
Parity Debt (other than Indebtedness under Section 7B.2(ii) or
that by its terms does not permit such offer to be made); and

(d) the Borrower shall have delivered to the Noteholders
a Certificate of the Board of Directors of the General Partner,
certifying that such sale or other disposition is for fair value and
is in the best interests of the Borrower.

Notwithstanding the foregoing, Asset Sales shall not be deemed to
include (1) any transfer of assets or issuance or sale of Capital Stock by the
Borrower or any of its Subsidiaries to the Borrower or a Wholly-Owned
Subsidiary of the Borrower, (2) any transfer of assets or issuance or sale of
Capital Stock by the Borrower or any of its Subsidiaries to any Person in
exchange for, or the Net Proceeds of which are applied within 12 months to the
purchase of, other assets used in a line of business permitted under Section
7B.8 and having a fair market value (as determined in good faith by the Board
of Directors of the General Partner) not less than that of the assets so
transferred or Capital Stock so issued or sold and (3) any transfer of assets
pursuant to an Investment permitted by Section 7B.5.

Notwithstanding the foregoing, without the prior written consent of
the Banks, the aggregate Net Proceeds of Asset Sales consummated after the
Initial Closing Date shall not exceed $10,000,000.

7B.8 Business. The Borrower will not and will not permit any of
its Subsidiaries to engage in any line of business if as a result thereof the
Borrower and its Subsidiaries would not be principally and predominately
engaged in the Business and related general and administrative operations, as
more fully described in the Memorandum and subject in all respects to the
provisions of clause (iii) of the proviso to Section 7B.5(v).

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7B.9 Transactions with Affiliates. The Borrower will not, and will
not permit any of its Subsidiaries to, directly or indirectly, engage in any
transaction with any Affiliate unless (i) (a) such transaction is on fair and
reasonable terms that are no less favorable to the Borrower or such Subsidiary,
as the case may be, than those which would be obtained in an arm's-length
transaction from a Person other than an Affiliate and (b) such transaction is
entered into in the ordinary course of business and pursuant to the reasonable
requirements at the time of the Borrower's or such Subsidiary's operations, or
(y) such transaction involves the acquisition by the Borrower from the General
Partner of assets formerly owned by an entity, the Capital Stock of which was
purchased by the General Partner, which acquisition is for a substantially
equivalent value as the value of such purchase consummated within ten days
after the consummation of such purchase, as long as such transaction otherwise
would be permitted hereunder had the Borrower acquired such assets directly
from such entity (including, for example, the acquisition by the Borrower from
the General Partner of assets formerly owned by Kingston Propane, Inc.) (ii)
such transaction is in connection with the incurrence of Indebtedness pursuant
to Section 7B.2(viii), (iii) such transaction is in connection with the making
of an Investment pursuant to Section 7B.5(i), (iv) such transaction is a
Restricted Payment permitted by Section 7B.6, (v) such transaction involves
performance under the Contribution Agreement (substantially in the form in
effect on the Closing Date), (vi) such transaction involves indemnification and
contribution under Section 7.7 of the Partnership Agreement (as said section is
in effect on the Closing Date), to the extent such indemnification or
contribution arises from operations or activities in connection with the
Business (including securities issuances in connection with funding the
Business) or (vii) such transaction is a specific transaction described in the
Registration Statement.

7B.10 Subsidiary Stock and Indebtedness.

(i) The Borrower will not permit any of its Subsidiaries directly
or indirectly to issue or sell any Equity Interest of such Subsidiary of the
Borrower to any Person other than the Borrower or a Wholly-Owned Subsidiary of
the Borrower except (a) for the purpose of qualifying directors or (b) in
satisfaction of pre-emptive rights of holders of minority interests which are
triggered by an issuance of Equity Interests to the Borrower or a Subsidiary
of the Borrower and permit such holders to maintain their pro rata interests.

(ii) The Borrower will not directly or indirectly sell, assign,
pledge or otherwise dispose of any Equity Interest in or any Indebtedness of
any of its Subsidiaries, and will not permit any of its Subsidiaries directly
or indirectly to sell, assign, pledge or otherwise dispose of any Equity
Interest in or any Indebtedness of any other Subsidiary of the Borrower except
to the Borrower or a Wholly-Owned Subsidiary of the Borrower, unless (a)
simultaneously with such sale, transfer or disposition, all of the Equity
Interests (other than an Equity Interest representing less than 2% of the
outstanding Equity Interests of all classes of such Subsidiary taken together,
provided that such Equity Interest is considered an Investment pursuant to
Section 7B.5(v) and is permitted thereunder) or Indebtedness of such Subsidiary
owned by the Borrower and its Subsidiaries is sold, transferred or disposed of
as an entirety, (b) the Board of Directors of the General Partner shall have
determined, as evidenced by a resolution thereof, that the proposed sale,
transfer or disposition of such Equity Interests or Indebtedness is in the best
interests of the Borrower, (c) such Equity Interests or

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Indebtedness are sold, transferred or otherwise disposed of for cash or Cash
Equivalents or other assets used in a line of business permitted by Section 7B
and having a fair market value (as determined in good faith by the Board of
Directors of the General Partner) not less than that of the Equity Interests or
Indebtedness so transferred, to a Person upon terms deemed by the Board of
Directors of the General Partner to be acceptable, (d) the Subsidiary being
sold, transferred or otherwise disposed of shall not have any continuing
investment in the Borrower or any Subsidiary of the Borrower not being so sold,
transferred or disposed and (e) such sale, transfer or disposition is permitted
by Section 7B.7.

7B.11 Payment of Dividends by Subsidiaries. The Borrower will not,
and will not permit any of its Subsidiaries to, be subject to or enter into any
agreement which restricts the ability of any Subsidiary of the Borrower to
declare or pay any dividend to the Borrower, to make any distribution on any
Equity Interest of such Subsidiary to the Borrower, or to lend money to the
Borrower.

7B.12 Sales of Receivables. The Borrower will not, and will not
permit any of its Subsidiaries to, discount, pledge, sell (with or without
recourse), or otherwise sell for less than face value thereof any of its
accounts or notes receivable, except for sales of receivables (i) without
recourse which are seriously past due and which have been substantially written
off as uncollectible or collectible only after extended delays, or (ii) made in
connection with the sale of a business but only with respect to the receivables
directly generated by the business so sold.

7B.13 Material Agreements; Tax Status. The Borrower will not:

(i) amend or directly or indirectly modify in any manner the
definitions of "Allocable Proceeds" or "Excess Proceeds" of the Note Purchase
Agreement or any similar provisions of any agreement applicable to any
extensions, renewals or refundings thereof as Parity Debt under the provisions
of paragraph 7B.2(i);

(ii) amend or modify in any manner adverse to the holders of the
Notes, or grant any waiver or release under (if such action shall be adverse to
the holders of the Notes), any Partnership Document, any notes evidencing
Parity Debt or any agreement relating to Parity Debt or terminate in any manner
any Partnership Document, it being understood, without limitation, that no
modification that reduces principal, interest or fees, premiums, make-wholes or
penalty charges, or extends any scheduled or mandatory payment, prepayment or
redemption of principal or interest, or makes less restrictive any agreement or
releases away any security, or waives any condition precedent or default shall
be adverse to the holders of the Notes for purposes of this Agreement; or

(iii) permit the Master Partnership or the Borrower to be treated as
an association taxable as a corporation or otherwise to be taxed as an entity
for federal income tax purposes.

ARTICLE VIII

REPRESENTATIONS, COVENANTS AND WARRANTIES

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The Borrower represents, covenants and warrants as follows:

8.1 Organization. The Borrower is a limited partnership duly
organized, validly existing and in good standing under the laws of the State of
Delaware and has all requisite partnership power and authority to own and
operate its properties (including without limitation the assets owned and
operated by it), to conduct its business, to enter into this Agreement and the
other Loan Documents to which it is a party and the Operative Agreements and to
carry out the terms of this Agreement, the Notes, such other Loan Documents and
Operative Agreements. Each Subsidiary of the Borrower is duly organized,
validly existing and in good standing under the laws of its state of
organization and has all requisite power and authority to own and operate its
properties (including without limitation the assets owned and operated by it).

8.2 Partnership Interests. The sole general partner of the
Borrower is Heritage, which owns a 1.0101% general partner interest in the
Borrower. At the Closing Date (a) the only limited partner of the Borrower is
the Master Partnership, which owns a 98.9899% limited partner interest in the
Borrower as provided in the Registration Statement, and (b) the Borrower will
not have any partners other than Heritage and the Master Partnership. At the
Closing Date, the Borrower does not have any Subsidiary other than the
Subsidiaries of the Borrower as set forth on Schedule 8.2 or any Investments in
any Person (other than as set forth on Schedule 7B.5 or 8.2 or Investments of
the types described in Section 7B.5(i), (ii), (iii) or (vi)).

8.3 Qualification. The Borrower is duly qualified or registered
and is in good standing as a foreign limited partnership for the transaction of
business, and each of the Subsidiaries of the Borrower is duly qualified or
registered and is in good standing as a foreign corporation or partnership, as
the case may be, for the transaction of business, in the states and to the
extent listed in Schedule 8.3, and, except as reflected on Schedule 8.3, on the
Closing Date there are no other jurisdictions in which the nature of their
respective activities or the character of the properties they own, lease or use
makes such qualification or registration necessary and in which the failure so
to qualify or to be so registered would have a Material Adverse Effect. The
Borrower has taken all necessary partnership action to authorize the execution,
delivery and performance by it of this Agreement, the other Financing Documents
to which it is a party and the Operative Agreements. The Borrower has duly
executed and delivered each of this Agreement, the other Loan Documents and the
Operative Agreements to which it is a party, and each of such documents and
agreements and the Notes and the Security Documents constitute the legal, valid
and binding obligation of the Borrower enforceable against it in accordance
with its terms, except as such enforceability may be limited by bankruptcy,
insolvency, moratorium or similar laws affecting creditors' rights generally
and general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).

8.4 Business; Financial Statements.

(i) Prior to the Closing Date, the Borrower caused to be delivered
to the Banks complete and correct copies of (a) the Registration Statement and
(b) the Memorandum. The pro forma condensed consolidated financial statements
of the Master Partnership set forth in the Registration

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Statement comply as to form in all material respects with the applicable
accounting requirements of the Securities Act and the published rules and
regulations thereunder and the assumptions on which the pro forma adjustments
reflected in such pro forma condensed consolidated financial statements are
based provide a reasonable basis for presenting the significant effects of the
transactions contemplated by such pro forma condensed consolidated financial
statements and such pro forma adjustments give appropriate effect to such
assumptions and are properly applied in such pro forma condensed consolidated
financial statements.

(ii) The Borrower has not engaged in any business or activities
prior to the date of this Agreement, except for activities related to its
formation, organization and prospective operations, and the completion of the
Transactions. Immediately prior to the date of this Agreement each Subsidiary
of the Borrower was engaged in the business indicated on Schedule 8.4.

(iii) The Registration Statement contains complete and correct
copies of (a) the audited balance sheets of Heritage as of August 31, 1995 and
August 31, 1994, and the related audited statements of operations and cash
flows for the fiscal years ended August 31, 1995, August 31, 1994 and August
31, 1993 and (b) the unaudited condensed balance sheets of Heritage as of
February 29, 1996 and the related unaudited condensed statements of operations
and cash flows for the three months ended February 29, 1996 and February 29,
1995. Such financial statements (including any related schedules and notes)
are true and correct in all material respects (subject, as to interim
statements, to changes resulting from audits and year-end adjustments), have
been prepared in accordance with GAAP consistently followed throughout the
periods involved and show all liabilities, direct and contingent, of Heritage
required to be shown in accordance with such principles. The balance sheets
fairly present the financial condition of Heritage as at the respective dates
thereof, and the results of operations and cash flows fairly present the
results of operations of Heritage and its consolidated cash flows for the
periods indicated.

(iv) The Borrower has delivered to you complete and correct copies
of the unaudited pro forma condensed consolidated balance sheet of the Borrower
as of February 29, 1996 giving effect to the Transactions. Such balance sheet
has been prepared in accordance with GAAP to the extent applicable to such
balance sheet and fairly presents in all material respects the financial
position of the Borrower on a pro forma basis immediately after the
Transactions in accordance with the assumptions disclosed therein at the date
of such balance sheet.

(v) The Borrower has caused to be delivered to you true and
correct copies of the documents and other materials listed on Schedule 8.4.

8.5 Actions Pending. There is no action, suit, investigation or
proceeding pending or, to the knowledge of the Borrower, threatened against the
Borrower or the General Partner or any of the Subsidiaries of the Borrower, or
any properties or rights of the Borrower or the General Partner or any of the
Subsidiaries of the Borrower, by or before any court, arbitrator or
administrative or governmental body (i) which questions the validity or
enforceability of this Agreement, the Notes, any other Financing Document or
any Operative Agreement or any action to be taken pursuant to

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this Agreement, the Notes, any other Loan Document or any Operative Agreement
or (ii) which could reasonably be expected to result in a Material Adverse
Effect.

8.6 Changes. Except as contemplated by this Agreement, the Notes,
the other Financing Documents or the Operative Agreements or as described in
the Registration Statement or the Memorandum, (i) neither the Borrower nor any
of the Subsidiaries of the Borrower has incurred any material liabilities or
obligations, direct or contingent, nor entered into any material transaction,
in each case other than in the ordinary course of business, and (ii) there has
not been any material adverse change in or effect on the business, assets,
financial condition or prospects of the Borrower or any of the Subsidiaries of
the Borrower.

8.7 Outstanding Indebtedness. Other than the Credit Obligations
represented by the Notes, neither the Borrower nor any of the Subsidiaries of
the Borrower as set forth on Schedule 8.2 has outstanding any Indebtedness
except as set forth on Schedule 8.7 and any such Indebtedness which is
indicated in Schedule 8.7 to be paid in full on the Closing Date will be paid
in full at the time of Closing. There exists no default under the provisions
of any instrument evidencing such Indebtedness or of any agreement relating
thereto. On the Closing Date, no instrument or agreement to which the Borrower
or any of the Subsidiaries of the Borrower is a party or by which the Borrower,
any such Subsidiary, or their respective properties is bound (other than this
Agreement and the Note Purchase Agreement and other than as indicated in
Schedule 8.7) will contain any restriction on the incurrence by the Operating
Partnership or any of the Subsidiaries of the Borrower of additional
Indebtedness.

8.8 Transfer of Assets and Business; Title to Properties.

(i) Except as set forth on Schedule 8.8, the Borrower and the
Subsidiaries of the Borrower will at the Closing Date be in possession of, and
operating in compliance with, all franchises, grants, authorizations,
approvals, licenses, permits, easements, rights-of-way, consents, certificates
and orders (collectively, the "Permits") required (a) to own, lease or use its
properties (including without limitation to own, lease or use the Assets owned,
leased or used by it) and (b) considering all such Permits in the possession
of, and complied with by, the Borrower and its Subsidiaries taken together, to
permit the conduct of the Business as now conducted and proposed to be
conducted, except for those Permits (x) which are routine and administrative in
nature and are expected in the reasonable judgment of the Borrower to be
obtained or given in the ordinary course of business from time to time after
the Closing Date, and (y) which, if not obtained or given, would not,
individually or in the aggregate, present a reasonable likelihood of having a
Material Adverse Effect,

(ii) Except as set forth on Schedule 8.8, on and after the Closing
Date, the Borrower and the Subsidiaries of the Borrower will have, (i) good and
marketable title to, or valid leasehold interests in, all of the Assets
constituting real property except for defects in, or lack of recorded, title
and exceptions to leasehold interests that either alone or in the aggregate
could not reasonably be expected to result in a Material Adverse Effect, and
(ii) good and sufficient title to, or valid rights to use, all of the Assets
constituting personal property reasonably necessary for the operation of such

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personal property as it is used on the date hereof and proposed to be used in
the Business, in each case subject to no Liens except such as are permitted by
Section 7B.3 and Liens, if any, which will be discharged on the Closing Date.
The Assets owned by the Borrower and the Subsidiaries of the Borrower will be
all of the assets and properties reasonably necessary to enable the Borrower
and its Subsidiaries to conduct the Business on the Closing Date. Subject to
such exceptions as would not, individually or in the aggregate, present a
reasonable likelihood of having a Material Adverse Effect (A) on the date
hereof the Borrower and its Subsidiaries enjoy, peaceful and undisturbed
possession under all leases and subleases necessary in any material respect for
the conduct of the Business, and (B) all such leases and subleases are valid
and subsisting and are in full force and effect. None of the properties or
assets of the Borrower or any of the Subsidiaries of the Borrower is subject to
any Lien other than Liens that would be permitted to be imposed pursuant to
Section 7B.3 as of the Closing Date, immediately after giving effect to the
Transactions.

8.9 Taxes. On the Closing Date each of the Operating Partnership
and its Subsidiaries will have filed all federal, state and other income tax
returns which, to the knowledge of the Borrower, are required to be filed or
will have properly filed for extensions of time for the filing thereof, and has
paid all taxes, assessments and other governmental charges levied upon it or
any of its properties, assets, income or franchises as shown to be due on such
returns, except those which are not past due or are being contested in good
faith in compliance with Section 7A.5. The Borrower is a limited partnership
not subject to taxation with respect to its income or gross receipts under
applicable state laws and that is treated as a pass-through entity for U.S.
federal income tax purposes.

8.10 Compliance with Other Instruments, etc.; Solvency.

(i) On the Closing Date, immediately prior to the completion of
the transactions contemplated by this Agreement, the Notes, the other Loan
Documents and the Operative Agreements), neither the Borrower nor any of the
Subsidiaries of the Borrower will be in violation of (a) any provision of its
certificate or articles of incorporation or other constitutive documents or its
by-laws, (b) any provision of any agreement or instrument to which it is a
party or by which any of its properties is bound or (c) any applicable law,
ordinance, rule or regulation of any Governmental Authority or any applicable
order, judgment or decree of any court, arbitrator or Governmental Authority
except (in the case of clauses (b) and (c) above only) for such violations
which would not, individually or in the aggregate, present a reasonable
likelihood of having a Material Adverse Effect.

(ii) The execution, delivery and performance of this Agreement, the
Notes, the other Loan Documents and the Operative Agreements, and the
completion of the transactions contemplated by the Registration Statement to
occur prior to the Closing Date (including without limitation the transactions
contemplated by this Agreement, the Notes, the other Loan Documents and the
Operative Agreements) will not violate (a) any provision of the certificate or
articles of incorporation or other constitutive documents or by-laws of the
Borrower, the General Partner or any of the Subsidiaries of the Borrower, (b)
any applicable law, ordinance, rule or regulation of any Governmental Authority
or any applicable order, judgment or decree of any court, arbitrator or

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Governmental Authority, or (c) any provision of any agreement or instrument to
which the Borrower, the General Partner or any of the Subsidiaries of the
Borrower is a party or by which any of its properties is bound.

(iii) Upon completion of the transactions contemplated by this
Agreement, the Notes, the other Loan Documents and the Operative Agreements),
none of the Borrower, the General Partner or any Subsidiary of the Borrower
shall (a) be insolvent, (b) be engaged or about to engage in business or a
transaction at a time the Borrower, the General Partner or any Subsidiary of
the Borrower could be viewed as having unreasonably small capital, or (c)
intend to incur, or believe that it would incur, debts that would be beyond its
ability to pay as such debts matured.

8.11 Governmental Consent. No consent, approval or authorization
of, or declaration or filing with, any Governmental Authority is required for
the valid execution, delivery and performance of this Agreement, the Notes, the
other Loan Documents or the Operative Agreements.

8.12 Use of Proceeds. None of the proceeds of the Loans will be
used, directly or indirectly, for the purpose, whether immediate, incidental or
ultimate, of purchasing or carrying any margin stock (as defined in Section
8.17 hereof) or for the purpose of maintaining, reducing or retiring any
indebtedness which was originally incurred to purchase or carry any stock that
is currently a margin stock or for any other purpose which might constitute
this transaction a "purpose credit" within the meaning of such Regulation U or
X. The Borrower nor anyone acting on their respective behalfs has taken or
will take any action which might cause this Agreement or the Notes to violate
Regulation U, Regulation T or any other regulation of the Board of Governors of
the Federal Reserve System or to violate the Exchange Act, in each case as in
effect now or as the same may hereafter be in effect.

8.13 ERISA. The Borrower and their respective ERISA Affiliates is
in compliance in all material respects with the applicable provisions of ERISA
and the Code and the regulations and published interpretations thereunder. No
ERISA Event has occurred or is reasonably expected to occur that, when taken
together with all other such ERISA Events, could reasonably be expected to
result in a Material Adverse Effect. The present value of all benefit
liabilities under each Plan (based on those assumptions used for purposes of
Statement of Financial Accounting Standards No. 87) did not, as of the last
annual valuation date applicable thereto, exceed by more than $2,000,000 the
fair market value of the assets of such Plan, and the present value of all
benefit liabilities of all underfunded Plans (based on those assumptions used
for purposes of Statement of Financial Accounting Standards No. 87) did not, as
of the last annual valuation dates applicable thereto, exceed by more than
$2,000,000 the fair market value of the assets of all such underfunded Plans.

8.14 Environmental Compliance.

(i) Except where the failure to be in compliance could not present
a reasonable likelihood of having a Material Adverse Effect, as of the date
hereof the Borrower and each Subsidiary of the Borrower is in compliance with
all Environmental Laws applicable to it and to the Business or Assets. The
Borrower and each Subsidiary of the Borrower is in compliance with all
franchises,

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grants, authorizations, permits, licenses, and approvals required under
Environmental Laws, except for any non-compliance or failure to obtain such
Permits which could not reasonably be expected to have a Material Adverse
Effect. The Borrower has caused Heritage to submit timely and complete
applications to renew any expired or expiring Permits required pursuant to any
Environmental Law, except for any non-compliance or failure to obtain such
permits which could not reasonably be expected to have a Material Adverse
Effect. All reports, documents, or other submissions required by Environmental
Laws to be submitted by the Borrower to any Governmental Authority or Person
have been filed by or on behalf of the Borrower, except where the failure to do
so would not present a reasonable likelihood of having a Material Adverse
Effect.

(ii) (a) There is no Hazardous Substance present at any of the
real property currently owned or leased by the Borrower or any of the
Subsidiaries of the Borrower except to the extent that such presence could not
reasonably be expected to have a Material Adverse Effect, and (b) to the
knowledge of the Borrower, there was no Hazardous Substance present at any of
the real property formerly owned or leased by Heritage during the period of
ownership or leasing by such Person; and with respect to such real property and
subject to the same knowledge and temporal qualifiers concerning Hazardous
Substances with respect to formerly owned or leased real properties, there has
not occurred (x) any release, or to the knowledge of the Borrower, any
threatened release of a Hazardous Substance, or (y) any discharge or, to the
knowledge of the Borrower, any threatened discharge of any Hazardous Substance
into the ground, surface or navigable waters which discharge or threatened
discharge violates any federal, state, local or foreign laws, rules or
regulations concerning water pollution.

(iii) Neither the Borrower nor any of the Subsidiaries of the
Borrower has disposed of, transported, or arranged for the transportation or
disposal of any Hazardous Substance where such disposal, transportation, or
arrangement would give rise to liability pursuant to CERCLA or any analogous
state statute other than any such liabilities that could not reasonably be
expected to have a Material Adverse Effect.

(iv) Except as disclosed to the Banks in writing, (a) no Lien has
been asserted by any Governmental Authority or person resulting from the use,
spill, discharge, removal, or remediation of any Hazardous Substance with
respect to any real property currently owned or leased by Heritage or the
Borrower, and (b) to the knowledge of the Borrower, no such Lien was asserted
with respect to any of the real property formerly owned or leased by Heritage
during the period of ownership or leasing of the real property by such Person.

(v) (a) There are no underground storage tanks, asbestos-containing
materials, polychlorinated biphenyls, or urea formaldehyde insulation at any of
the real property currently owned or leased by the Borrower in violation of any
Environmental Law, and (b) to the knowledge of the Borrower, there were no
underground storage tanks, asbestos-containing materials, polychlorinated
biphenyls, or urea formaldehyde insulation at any of the real property formerly
owned or leased by Heritage in violation of any Environmental Law during the
period of ownership or leasing of such real property by such Person.

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(vi) As of the date hereof, any propane is stored, used and handled
by the Borrower and the Subsidiaries of the Borrower in compliance with all
applicable Environmental Laws except for any storage, use or handling of
propane that could not reasonably be expected to have a Material Adverse
Effect.

8.15 Pre-emptive Rights. There are no pre-emptive rights to which
a holder of a minority interest in any Subsidiary of the Borrower is entitled.

8.16 Disclosure. This Agreement, the Notes, the other Loan
Documents, the Operative Agreements, the Memorandum and any other document,
certificate or statement furnished to any Bank by or on behalf of the Borrower,
the General Partner or their respective Subsidiaries or Affiliates, in
connection herewith, taken together, do not contain and the Registration
Statement does not contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements contained
herein and therein, in light of the circumstances under which they were made,
not misleading. There is no fact known to the Borrower which has or in the
future could reasonably be expected to have (so far as the Borrower can now
foresee) a Material Adverse Effect and which has not been set forth in this
Agreement or in the other documents, certificates and statements furnished to
each the Banks hereunder by or on behalf of the Borrower.

8.17 Federal Reserve Regulations. Neither the Borrower nor the
Subsidiary of the Borrower will, directly or indirectly, use any of the
proceeds of any Loan for the purpose, whether immediate, incidental or
ultimate, of buying a "margin stock" or of maintaining, reducing or retiring
any indebtedness originally incurred to buy a stock that is currently a "margin
stock", or for any other purpose which might constitute this transaction a
"purpose credit" which is secured "directly or indirectly by margin stock", in
each case within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System (12 C.F.R. 207, as amended), or otherwise take or permit
to be taken any action which would involve a violation of such Regulation U or
of Regulation X (12 C.F.R. 224, as amended) or any other applicable regulation
of such Board. No indebtedness being retired, directly or indirectly, out of
the proceeds of the Loans will be incurred for the purpose of buying or
carrying any stock which is currently a "margin stock", and the Borrower
neither owns or has any present intention of acquiring any amount of such
"margin stock".

8.18 Investment Borrower Act. None of the Borrower or any
Subsidiary of the Borrower is an "investment Borrower", or a Borrower
"controlled" by an "investment Borrower", within the meaning of the Investment
Borrower Act of 1940, as amended.

8.19 Public Utility Holding Company Act. The Borrower, the General
Partner and each Subsidiary of the Borrower is exempt from all of the
provisions of the Public Utility Holding Company Act of 1935, as amended (the
"PUHCA") and the rules thereunder other than Section 9(a)(2) thereof based upon
a no-action letter from the Commission dated June 19, 1996.

8.20 Matters Relating to the General Partner. Immediately after
the Transactions, the ownership of the Borrower and the Master Partnership
shall be, in all material respects, as described in the Registration Statement.
Heritage will own, in addition to the interest described in Section 8.3,

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a 1% general partner interest in the Master Partnership and 3,702,943
Subordinated Units, representing a 47.0% limited partner interest in the Master
Partnership and the Borrower on a combined basis, if no overallotment option is
exercised by the Underwriters or representing a 43.6% limited partnership
interest in the Master Partnership and the Borrower on a combined basis, if the
overallotment option is exercised in full by the Underwriters.

ARTICLE IX

EVENTS OF DEFAULT

9.1 Acceleration. If any of the following conditions or events
("Events of Default") shall occur and be continuing for any reason whatsoever
(and whether such occurrence shall be voluntary or involuntary or come about or
be effected by operation of law or otherwise):

(i) the Borrower defaults in the payment of any principal of on
any Note when the same becomes due and payable, either by the terms thereof or
otherwise as herein provided; or

(ii) the Borrower defaults in the payment of any interest on any
Note for more than 5 days after the same becomes due and payable; or

(iii) the Borrower or any Subsidiary of the Borrower (whether as
primary obligor or as guarantor or other surety) defaults in any payment of
principal of or interest on any Parity Debt or any other Indebtedness other
than the Notes (including without limitation any Capitalized Lease Obligation,
any obligation under a conditional sale or other title retention agreement, any
obligation issued or assumed as full or partial payment for property whether or
not secured by a purchase money mortgage or any obligation under notes payable
or drafts accepted representing extensions of credit), beyond any period of
grace provided with respect thereto, or the Borrower or any Subsidiary of the
Borrower fails to perform or observe any other agreement or term or condition
contained in any agreement under which any such obligation is created (or if
any other event thereunder or under any such agreement shall occur and be
continuing) and the effect of such failure or other event is to cause, or to
permit the holder or holders of such Indebtedness (or a trustee on behalf of
such holder or holders) to cause, such obligation to become due or to be
repurchased prior to any stated maturity, provided that the aggregate amount of
all Indebtedness as to which such a default (payment or other) shall occur and
be continuing or such a failure or other event causing or permitting
acceleration (or resale to the Borrower or any Subsidiary of the Borrower)
shall occur and be continuing exceeds $2,000,000; provided, further, that no
waiver, modification or amendment relating to any such a default (payment or
other) or such a failure or other event with respect to any Parity Debt or
agreement or instrument relating to any Parity Debt shall be effective for
purposes of this clause (iii) if any consideration (other than the payment of
reasonable attorney's fees) is given, directly or indirectly, by the Borrower
or any of its Subsidiaries or Affiliates in respect thereof, unless
substantially the same consideration is given to the holders of the Notes; or

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(iv) any representation or warranty made in any writing by or on
behalf of the Borrower, General Partner or the Master Partnership in this
Agreement, any other Loan Document or any instrument furnished pursuant to this
Agreement or any Loan Document shall prove to have been false or incorrect in
any material respect on the date as of which made; or

(v) the Borrower fails to perform, observe or comply with any
agreement contained in Sections 7B.1 through 7B.13; or

(vi) the Borrower fails to perform or observe any other agreement,
term or condition contained in this Agreement or the other Loan Documents and
such failure shall not be remedied within 30 days after any Responsible Officer
obtains actual knowledge or notice thereof; or

(vii) the General Partner, the Borrower or any Significant
Subsidiary Group makes an assignment for the benefit of creditors or is
generally not paying its debts as such debts become due; or

(viii) any decree or order for relief in respect of the General
Partner, the Borrower or any Significant Subsidiary Group is entered under any
bankruptcy, reorganization, compromise, arrangement, insolvency, readjustment
of debt, dissolution or liquidation or similar law, whether now or hereafter in
effect (herein called the "Bankruptcy Law"), of any jurisdiction; or

(ix) the General Partner, the Borrower or any Significant
Subsidiary Group petitions or applies to any tribunal for, or consents to, the
appointment of, or taking possession by, a trustee, receiver, custodian,
liquidator or similar official of the General Partner, the Borrower or any
Significant Subsidiary Group , or of any substantial part of the assets of the
General Partner, the Borrower or any Significant Subsidiary Group, or commences
a voluntary case under the Bankruptcy Law of the United States or any
proceedings (other than proceedings for the voluntary liquidation and
dissolution of the General Partner, the Borrower or any Significant Subsidiary
Group) relating to the General Partner, the Borrower or any Significant
Subsidiary Group under the Bankruptcy Law of any other jurisdiction; or

(x) any such petition or application is filed, or any such
proceedings are commenced, against the General Partner, the Borrower or any
Significant Subsidiary Group and the General Partner, the Borrower or any
Significant Subsidiary Group by any act indicates its approval thereof,
consents thereto or acquiesces therein, or an order, judgment or decree is
entered appointing any such trustee, receiver, custodian, liquidator or similar
official, or approving the petition in any such proceedings, and such order,
judgment or decree remains unstayed and in effect for more than 30 days; or

(xi) a judgment or judgments for the payment of money in excess of
$2,000,000 in the aggregate (except to the extent covered by insurance as to
which the insurer has acknowledged in writing its obligation to cover in full)
shall be rendered against the Borrower or any Subsidiary of the Borrower and
either (i) enforcement proceedings have been commenced by any creditor upon
such judgment or order or (ii) within 45 days after entry thereof, such
judgment is not discharged

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or execution thereof stayed pending appeal, or within 45 days after the
expiration of any such stay, such judgment is not discharged; or

(xii) any order, judgment or decree is entered in any proceedings
against the General Partner, the Borrower or any Significant Subsidiary Group
decreeing the dissolution of the General Partner, the Borrower or any
Significant Subsidiary Group and such order, judgment or decree remains
unstayed and in effect for more than 30 days or any other event occurs that
results in the termination, dissolution or winding up of the Borrower, subject
to Section 7B.7, the General Partner or any Significant Subsidiary Group; or

(xiii) any order, judgment or decree is entered in any proceedings
against the Borrower or any of its Subsidiaries decreeing a split-up of the
Borrower or such Subsidiary which requires the divestiture of assets
representing a substantial part, or the divestiture of the stock of a
Subsidiary of the Borrower whose assets represent a substantial part of the
consolidated assets of the Borrower and its Subsidiaries (determined in
accordance with GAAP) or which requires the divestiture of assets, or stock of
a Subsidiary of the Borrower, which shall have contributed a substantial part
of the Consolidated Net Income of the Borrower and its Subsidiaries for any of
the three fiscal years then most recently ended, and such order, judgment or
decree shall not be dismissed or execution thereon stayed pending appeal or
review within 45 days after entry thereof, or in the event of such a stay, such
order, judgment or decree shall not be dismissed within 45 days after such stay
expires; or

(xiv) any of the Security Documents shall at any time, for any
reason cease to be in full force and effect or shall fail to constitute a
valid, perfected first priority Lien with respect to the Collateral subject to
Liens permitted by the Security Agreement or shall be declared to be null and
void in whole or in any material respect (i.e., relating to the validity or
priority of the Liens created by the Security Documents or the remedies
available thereunder) by the judgment of any court or other Governmental
Authority having jurisdiction in respect thereof, or if the validity or the
enforceability of any of the Security Documents shall be contested by or on
behalf of the Borrower, or the Borrower shall renounce any of the Security
Documents, or deny that it is bound by the terms of any of the Security
Documents; or

(xv) (a) the General Partner shall be engaged in any business or
activities other than those permitted by the Partnership Agreement as in effect
on the Closing Date, or (b) the General Partner ceases to be the sole general
partner of the Borrower or the Master Partnership, or (c) Current Management
shall own, directly or indirectly, less than 51% of the Capital Stock of the
General Partner; or

(xvi) an ERISA Event shall have occurred that, when taken together
with all other such ERISA Events that have occurred, could reasonably be
expected to result in liability of the Borrower and its ERISA Affiliates in an
aggregate amount exceeding $2,000,000; or

(xvii) an event of default under any of the Security Documents has
occurred and is continuing.

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9.2 Remedies. Upon the occurrence of any Event of Default
referred to in (viii), (ix) or (x) of this Section 9.1 the Commitments shall
immediately terminate and the Notes and all other Indebtedness shall be
immediately due and payable, without further notice of any kind. Upon the
occurrence of any other Event of Default, and without prejudice to any right or
remedy of the Banks under this Agreement or the Loan Documents or under
applicable Law of under any other instrument or document delivered in
connection herewith, the Banks may (i) declare the Commitments terminated or
(ii) declare the Commitments terminated and declare the Notes and the other
Indebtedness, or any part thereof, to be forthwith due and payable, whereupon
the Notes and the other Indebtedness, or such portion as is designated by the
Banks shall forthwith become due and payable, without presentment, demand,
notice or protest of any kind, all of which are hereby expressly waived by the
Borrower. No delay or omission on the part of the Banks in exercising any
power or right hereunder or under the Notes, the Loan Documents or under
applicable law shall impair such right or power or be construed to be a waiver
of any default or any acquiescence therein, nor shall any single or partial
exercise by the Banks of any such power or right preclude other or further
exercise thereof or the exercise of any other such power or right by the Banks.
In the event that all or part of the Indebtedness becomes or is declared to be
forthwith due and payable as herein provided, the Banks shall have the right to
set off the amount of all the Indebtedness of the Borrower owing to the Banks
against, and shall have, and is hereby granted by the Borrower, a lien upon and
security interest in, all property of each of the Borrower in the Banks'
possession at or subsequent to such default, regardless of the capacity in
which the Banks possess such property, including but not limited to any balance
or share of any deposit, collection or agency account. After Default all
proceeds received by the Banks may be applied to the Indebtedness in such order
of application and such proportions as the Banks, in their discretion, shall
choose. At any time after the occurrence of any Event of Default, the Banks
may, at their option, cause an audit of any and/or all of the books, records
and documents of the Borrower to be made by auditors satisfactory to the Banks
at the expense of the Borrower. The Banks also shall have, and may exercise,
each and every right and remedy granted to them for default under the terms of
the Security Documents and the other Loan Documents.

9.3 Other Remedies. If any Event of Default or Default shall
occur and be continuing, the holder of any Note may proceed to protect and
enforce its rights under this Agreement and such Note by exercising such
remedies as are available to such holder in respect thereof under applicable
law, either by suit in equity or by action at law, or both, whether for
specific performance of any covenant or other agreement contained in this
Agreement or in aid of the exercise of any power granted in this Agreement. No
remedy conferred in this Agreement upon the holder of any Note is intended to
be exclusive of any other remedy, and each and every such remedy shall be
cumulative and shall be in addition to every other remedy conferred herein or
now or hereafter existing at law or in equity or by statute or otherwise.

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ARTICLE X

LOAN OPERATIONS

10.1 Interests in Loans/Commitments. The percentage interest of
each Bank in the Loans and Letters of Credit, and the Commitments, shall be
computed based on the maximum principal amount for each Bank as follows:

Maximum Maximum Working Maximum
Acquisition Capital Commitments Percentage
Bank Loan Commitments Loan Commitments Amount Interest
---- ---------------- ---------------- ------ --------

BOk $12,500,000 $ 7,500,000 $24,000,000 50.00%
Bank of Boston $12,500,000 $ 7,500,000 $24,000,000 50.00%
---------- ---------- ---------- -----

Total $25,000,000 $15,000,000 $40,000,000 100.00%

The foregoing percentage interests, as from time to time in effect and
reflected in the Register, are referred to as the "Percentage Interests" with
respect to all or any portion of the Loans and Letters of Credit, and the
Commitments.

10.2 Administrative Agent's Authority to Act. Each of the Banks
appoints and authorizes Bank of Boston to act for the Banks as Administrative
Agent in connection with the transactions contemplated by this Agreement and
the other Loan Documents on the terms set forth herein. In acting hereunder,
the Administrative Agent is acting for the account of Bank of Boston to the
extent of its Percentage Interest and for the account of each other Bank to the
extent of such Bank's Percentage Interest, and all action in connection with
the enforcement of, or the exercise of any remedies (other than the Banks'
rights of set-off as provided herein or in any other Loan Document) in respect
of the Loans and the Indebtedness shall be taken by the Administrative Agent.

10.3 Borrower to Pay Administrative Agent. The Borrower shall be
fully protected in making all payments in respect of the Notes evidencing the
Credit Obligations to the Administrative Agent, in relying upon consents,
modifications and amendments executed by the Administrative Agent purportedly
on the Banks' behalf, and in dealing with the Administrative Agent as herein
provided. Upon three (3) Business Days notice, the Administrative Agent may
charge the accounts of the Borrower, on the dates when the amounts thereof
become due and payable, with the amounts of the principal of and interest on
the Loans, including any amounts paid by the Administrative Agent to third
parties under Letters of Credit or drafts presented thereunder, commitment
fees, Letter of Credit issuance fees and processing/application fees pertaining
thereto and all other fees and amounts owing under any Loan Document.

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10.4 Bank Operations for Advances, Letters of Credit.

10.4.1 Advances. On the funding date for each Loan, each
Bank shall advance to the Administrative Agent in immediately
available funds such Bank's Percentage Interest in the portion of a
Loan advanced on such funding date prior to 12:00 noon (Boston,
Massachusetts time). If such funds are not received at such time, but
all applicable conditions set forth in Article VI have been satisfied,
each Bank authorizes and requests the Administrative Agent to advance
for the Bank's account, pursuant to the terms hereof, the Bank's
respective Percentage Interest in such portion of such Loan and agrees
to reimburse the Administrative Agent in immediately available funds
for the amount thereof prior to 3:00 p.m. (Boston, Massachusetts time)
on the day any portion of such Loan is advanced hereunder; provided,
however, that the Administrative Agent is not authorized to make any
such advance for the account of any Bank who has previously notified
the Administrative Agent in writing that such Bank will not be
performing its obligations to make further advances hereunder; and
provided, further, that the Administrative Agent shall be under no
obligation to make any such advance.

10.4.2 Letters of Credit. Each of the Banks authorizes and
requests each Letter of Credit Issuer to issue the Letters of Credit
provided for in Section 2.3 and agrees to purchase a participation in
each of such Letters of Credit in an amount equal to its Percentage
Interest in the amount of each such Letter of Credit. Promptly upon
the request of any Letter of Credit Issuer, each Bank shall reimburse
such Letter of Credit Issuer in immediately available funds for such
Bank's Percentage Interest in the amount of all obligations to third
parties incurred by the Letter of Credit Issuer in respect of each
Letter of Credit and each draft accepted under a Letter of Credit to
the extent not timely reimbursed by the Borrower. Each Letter of
Credit Issuer will notify each Bank (and the Administrative Agent if
the Administrative Agent is not the Letter of Credit Issuer) of the
issuance of each Letter of Credit, the amount and date of payment of
any draft drawn or accepted under a Letter of Credit and whether in
connection with the payment of any such draft the amount thereof was
added to the Working Capital Loan or was reimbursed by the Borrower.

10.4.3 Administrative Agent to Allocate Payments. All
payments of principal and interest in respect of the extensions of
credit made pursuant to this Agreement, reimbursement of amounts paid
by each Letter of Credit Issuer to third parties under Letters of
Credit or drafts presented thereunder, commitment fees, Letter of
Credit issuance fees and other fees under this Agreement (except for
the standard Letter of Credit application/processing fees of any
Letter of Credit Issuer and any fees due to either Agent pursuant to
the Administrative Agent's Fee Letter or the Facilitating Agent's Fee
Letter, as the case may be), which shall not be shared by the Banks
shall, as a matter of convenience, be made by the Borrower to the
applicable Letter of Credit Issuer or the applicable Agent, as the
case may be. The share of each Bank shall be credited to such Bank by
the Administrative Agent in immediately available funds in such manner
that the principal amount of the Loans constituting Credit Obligations
to be paid shall be paid proportionately in accordance with the Banks'
respective Percentage Interests in such Loans, except as

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otherwise provided in this Agreement. Under no circumstances shall any
Bank be required to produce or present its Notes as evidence of its
interests in the Loans constituting Credit Obligations in any action
or proceeding relating to the Loans constituting Credit Obligations.

10.4.4 Delinquent Banks; Nonperforming Banks. In the event
that any Bank fails to reimburse the Administrative Agent pursuant to
Section 10.4.1 for the Percentage Interest of such Bank (a "Delinquent
Bank") in any credit advanced by the Administrative Agent pursuant
hereto, overdue amounts (the "Delinquent Payment") due from the
Delinquent Bank to the Administrative Agent shall bear interest,
payable by the Delinquent Bank on demand, at a per annum rate equal to
(a) the Federal Funds Rate for the first three days overdue and (b)
the sum of two percentage points (2%) plus the Federal Funds Rate for
any longer period. Such interest shall be payable to the
Administrative Agent for its own account for the period commencing on
the date of the Delinquent Payment and ending on the date the
Delinquent Bank reimburses the Administrative Agent on account of the
Delinquent Payment (to the extent not paid by the Borrower as provided
below) and the accrued interest thereon (the "Delinquency Period"),
whether pursuant to the assignments referred to below or otherwise.
Upon notice by the Administrative Agent, the Borrower will pay to the
Administrative Agent the principal (but not the interest) portion of
the Delinquent Payment. During the Delinquency Period, in order to
make reimbursements for the Delinquent Payment and accrued interest
thereon, the Delinquent Bank shall be deemed to have assigned to the
Administrative Agent all interest, commitment fees and other payments
made by the Borrower under Articles II, III and IV hereof that would
have thereafter otherwise been payable under the Loan Documents to the
Delinquent Bank. During any other period in which any Bank is not
performing its obligations to extend credit under Article II hereof (a
"Nonperforming Bank"), the Nonperforming Bank shall be deemed to have
assigned to each Bank that is not a Nonperforming Bank (a "Performing
Bank") all principal and other payments made by the Borrower that
would have thereafter otherwise been payable thereunder to the
Nonperforming Bank. The Administrative Agent shall credit a portion
of such payments to each Performing Bank in an amount equal to the
Percentage Interest of such Performing Bank in an amount equal to the
Percentage Interest of such Performing Bank divided by one minus the
Percentage Interest of the Nonperforming Bank until the respective
portions of the Loans owed to all the Banks are the same as the
Percentage Interests of the Banks immediately prior to the failure of
the Nonperforming Bank to perform its obligations under Article II
hereof. The foregoing provisions shall be in addition to any other
remedies the Agent, the Performing Banks or the Borrower may have
under law or equity against the Delinquent Bank as a result of the
Delinquent Payment or against the Nonperforming Bank as a result of
its failure to perform its obligations under Article II hereof.

10.5 Sharing of Payments. To the extent permitted by applicable
Bank Legal Requirements and subject to the provisions of the Intercreditor
Agreement, each Bank agrees that (i) if by exercising any right of set-off or
counterclaim or otherwise, it shall receive payment of (a) a proportion of the
aggregate amount due with respect to its Percentage Interest in the Loans and
Letter of Credit Exposure which is greater than (b) the proportion received by
any other Bank in

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respect of the aggregate amount due with respect to such other Bank's
Percentage Interest in the Loans and Letter of Credit Exposure and (ii) if such
inequality shall continue for more than 10 days, the Bank receiving such
proportionately greater payment shall purchase participations in the Percentage
Interests in the Loans and Letter of Credit Exposure held by the other Banks,
and such other adjustments shall be made from time to time (including
rescission of such purchases of participations in the event the unequal payment
originally received is recovered from such Bank through bankruptcy proceedings
or otherwise), as may be required so that all such payments of principal and
interest with respect to the Loans and Letter of Credit Exposure held by the
Banks shall be shared by the Banks pro rata in accordance with their respective
Percentage Interests; provided, however, that this Section 10.5 shall not
impair the right of any Bank to exercise any right of set-off or counterclaim
it may have and to apply the amount subject to such exercise to the payment of
Indebtedness of Borrower other than Borrower's Indebtedness with respect to the
Loans and Letter of Credit Exposure. Each Bank that grants a participation in
the Loans and Commitments to a Credit Participant shall require as a condition
to the granting of such participation that such Participant agree to share
payments received in respect of the Indebtedness as provided in this Section
10.5. The provisions of this Section 10.5 are for the sole and exclusive
benefit of the Banks and no failure of any Bank to comply with the terms hereof
shall be available to either Borrower as a defense to the payment of the Loans.

10.6 Amendments, Consents, Waivers. Except as otherwise set forth
herein, the Agents may (and upon the written request of the Required Banks the
Administrative Agent shall) take or refrain from taking any action under this
Agreement or any other Loan Document, including giving its written consent to
any modification of or amendment to and waiving in writing compliance with any
covenant or condition in this Agreement or any other Loan Document or any
Default or Event of Default, all of which actions shall be binding upon all of
the Banks; provided, however, that:

(i) Without the written consent of the Banks owning at least two
thirds (2/3) of the Percentage Interests (other than Delinquent Banks during
the existence of a Delinquency Period so long as such Delinquent Bank is
treated the same as the other Banks with respect to any actions enumerated
below), no written modification of, amendment to, consent with respect to,
waiver of compliance with or waiver of a Default under, any of the Loan
Documents shall be made, including without limitation, Sections 7B.1 through
7B.15 of this Agreement, the related defined terms or this Section 10.6(a)
shall be made.

(ii) Without the written consent of such Banks as own 100% of the
Percentage Interests (other than Delinquent Banks during the existence of a
Delinquency Period so long as such Delinquent Bank is treated the same as the
other Banks with respect to any actions enumerated below):

(a) No reduction shall be made in (A) the amount of
principal of any of the Loans or reimbursement obligations for
payments made under Letters of Credit, (B) the interest rate on the
Loans or (C) the Letter of Credit issuance fees (excluding, however,
Letter of Credit processing/application fees, the amount of which
shall be within the sole discretion of each Letter of Credit Issuer)
or commitment (non-usage) fees.

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(b) No change shall be made in the stated time of payment
of all or any portion of any of the Loans or interest thereon or
reimbursement of payments made under Letters of Credit or fees
relating to any of the foregoing payable to all of the Banks and no
waiver shall be made of any Default under Section 9.1(i).

(c) No increase shall be made in the amount, or extension
of the term, of either Commitment beyond that provided for under
Article II.

(d) Except as otherwise provided in the Intercreditor
Agreement, no alteration shall be made of the Banks' rights of set-off
contained herein or in the other Loan Documents.

(e) Except as otherwise provided in the Intercreditor
Agreement, no release of any Collateral shall be made (except that the
Collateral Agent may release particular items of Collateral in
dispositions permitted by the Security Documents in accordance with
the terms and provisions of the Intercreditor Agreement and may
release all Collateral upon payment in full of the Loans evidenced by
the Notes and termination of the Commitments together with payment of
all of the Private Placement Notes and Parity Debt without the written
consent of the Banks).

(f) No amendment to or modification of this Section
10.6(ii) shall be made.

10.7 Administrative Agent's Resignation. The Administrative Agent
may resign at any time by giving at least 30 days' prior written notice of its
intention to do so to each other of the Banks and the Borrower and upon the
appointment by the Required Banks of a successor Administrative Agent
satisfactory to the Borrower. If no successor Administrative Agent shall have
been so appointed and shall have accepted such appointment within 45 days after
the retiring Administrative Agent's giving of such notice of resignation, then
the retiring Administrative Agent may with the consent of the Borrower, which
shall not be unreasonably withheld, appoint a successor Administrative Agent
which shall be a bank or a trust Borrower organized under the laws of the
United States of America or any state thereof and having a combined capital,
surplus and undivided profit of at least $50,000,000; provided, however, that
any successor Administrative Agent appointed under this sentence may be removed
upon the written request of the Required Banks, which request shall also
appoint a successor Administrative Agent satisfactory to the Borrower. Upon
the appointment of a new Administrative Agent hereunder, the term
"Administrative Agent" shall for all purposes of this Agreement thereafter mean
such successor. After any retiring Administrative Agent's resignation
hereunder as Administrative Agent, or the removal hereunder of any successor
Administrative Agent, the provisions of this Agreement shall continue to inure
to the benefit of such Administrative Agent as to any actions taken or omitted
to be taken by it while it was Administrative Agent under this Agreement.

10.8 Concerning the Agents.

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10.8.1 Action in Good Faith. The Agents and their respective
officers, directors, employees and agents shall be under no liability
to any of the Banks or to any future holder of any interest in the
Indebtedness for any action or failure to act taken or suffered in
good faith, and any action or failure to act in accordance with an
opinion of its counsel shall conclusively be deemed to be in good
faith. The Agents shall in all cases be entitled to rely, and shall
be fully protected in relying, on instructions given to the Agents by
the Required Holders of the Notes evidencing the Indebtedness as
provided in this Agreement.

10.8.2 No Implied Duties. The Agents shall have and may
exercise such powers as are specifically delegated to the Agents under
this Agreement or any other Loan Document together with all other
powers incidental thereto. The Agents shall have no implied duties to
any Person or any obligation to take any action under this Agreement
or any other Loan Document except for action specifically provided for
in this Agreement or any other Loan Document to be taken by the
Agents. Before taking any action under this Agreement or any other
Loan Document, the Agents may request an appropriate specific
indemnity satisfactory to it from each Bank in addition to the general
indemnity provided for in Section 10.11. Until the Agents have
received such specific indemnity, the Agents shall not be obligated to
take (although such Agent may in its sole discretion take) any such
action under this Agreement or any other Loan Document. Each Bank
confirms that the Agents do not have a fiduciary relationship to them
under the Loan Documents. The Borrower and its Subsidiaries party
hereto confirm that neither the Agents nor any other Bank has a
fiduciary relationship to them under the Loan Documents.

10.8.3 Validity. The Agents shall not be responsible to any
Bank or any future holder of any interest in the Loans and
Indebtedness (a) for the legality, validity, enforceability or
effectiveness of this Agreement or any other Loan Document, (b) for
any recitals, reports, representations, warranties or statements
contained in or made in connection with this Agreement or any other
Loan Document, (c) for the existence or value of any assets included
in any security for the Loans and Indebtedness, (d) for the
effectiveness of any Lien purported to be included in the Collateral,
(e) for the specification or failure to specify any particular assets
to be included in the Collateral, or (f) unless the Agents shall have
failed to comply with Section 10.8.1, for the perfection of the
security interests in the Collateral.

10.8.4 Compliance. The Agents shall not be obligated to
ascertain or inquire as to the performance or observance of any of the
terms of this Agreement or any other Loan Document; and in connection
with any extension of credit under this Agreement or any other Loan
Document, the Agents shall be fully protected in relying on a
certificates of the Borrower as to the fulfillment by the Borrower of
any conditions to such extension of credit.

10.8.5 Employment Agents and Counsel. The Agents may execute
any of their respective duties as Agents under this Agreement or any
other Loan Document by or through employees, agents and
attorneys-in-fact and shall not be responsible to any of the Banks,
the Borrower for the default or misconduct of any such Agents or
attorneys-in-fact selected by the Agent acting in good faith. The
Agents shall be entitled to advice of counsel concerning

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all matters pertaining to the agency hereby created and its duties
hereunder or under any other Loan Document.

10.8.6 Reliance on Documents and Counsel. The Agents shall
be entitled to rely, and shall be fully protected in relying, upon any
affidavit, certificate, cablegram, consent, instrument, letter,
notice, order, document, statement, telecopy, telegram, telex or
teletype message or writing reasonably believed in good faith by the
Agents to be genuine and correct and to have been signed, sent or made
by the Person in question, including any telephonic or oral statement
made by such Person, and, with respect to legal matters, upon an
opinion or the advice of counsel selected by such Agent.

10.8.7 Agents' Reimbursement. Each of the Banks severally
agrees to reimburse the Agents, in the amount of such Bank's
Percentage Interest, for any reasonable expenses not reimbursed by the
Borrower (without limiting the obligation of the Borrower to make such
reimbursement): (a) for which the Agents are entitled to reimbursement
by the Borrower under this Agreement or any other Loan Document, and
(b) after the occurrence of a Default, for any other reasonable
expenses incurred by the Agents on the Banks' behalf in connection
with the enforcement of the Banks' rights under this Agreement or any
other Loan Document.

10.8.8 Agent's Fees. The Borrower shall pay to each of the
Agents for its own respective account a fee in the respective amounts
separately agreed to from time to time by the Borrower and the
applicable Agent pursuant to Administrative Agent Fee Letter (insofar
as the Administrative Agent is concerned) and the Facilitating Agent
Fee Letter (insofar as the Facilitating Agent is concerned),
respectively.

10.9 Rights as a Bank. With respect to any Loan(s) or advance(s)
extended by it hereunder, each of the Agents shall have the same rights,
obligations and powers hereunder as any other Bank and may exercise such rights
and powers as though it were not an Agent, and unless the context otherwise
specifies, the Agents shall be treated in their respective individual
capacities as though they were not the Agents hereunder. Without limiting the
generality of the foregoing, the Percentage Interest of each Agent shall be
included in any computations of Percentage Interests. Each Agent and its
Affiliates may accept deposits from, lend money to, act as trustee for and
generally engage in any kind of banking or trust business with the Borrower,
any of its Subsidiaries or any Affiliate of any of them and any Person who may
do business with or own an equity interest in the Borrower, any of its
Subsidiaries or any Affiliate of any of them, all as if the Administrative
Agent and the Facilitating Agent were not the Agents and without any duty to
account therefor to the other Banks.

10.10 Independent Credit Decision. Each of the Banks acknowledges
that it has independently and without reliance upon either of the Agents, based
on the financial statements and other documents referred to in Section 8.4, on
the other representations and warranties contained herein and on such other
information with respect to the Borrower and its Subsidiaries as such Bank
deemed appropriate, made such Bank's own credit analysis and decision to enter
into this Agreement

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and to make the extensions of credit provided for hereunder. Each Bank
represents to the Agents that such Bank will continue to make its own
independent credit and other decisions in taking or not taking action under
this Agreement or any other Loan Document. Each Bank expressly acknowledges
that neither the Agents nor any of their respective officers, directors,
employees, Agents, attorneys-in-fact or Affiliates has made any representations
or warranties to such Bank, and no act by either of the Agents taken under this
Agreement or any other Loan Document, including any review of the affairs of
the Borrower and its Subsidiaries, shall be deemed to constitute any
representation or warranty by either of the Agents. Except for notices,
reports and other documents expressly required to be furnished to each Bank by
the Administrative Agent under this Agreement or any other Loan Document, the
Agents shall not have any duty or responsibility to provide any Bank with any
credit or other information concerning the business, operations, property,
condition, financial or otherwise, or creditworthiness of the Borrower or any
Subsidiary which may come into the possession of either of the Agents or any of
their respective officers, directors, employees, agents, attorneys-in-fact or
Affiliates.

10.11 Indemnification. The holders of the Indebtedness shall
indemnify the Agents and their respective officers, directors, employees and
Agents (to the extent not reimbursed by the Borrower and without limiting the
obligation of the Borrower to do so), pro rata in accordance with their
respective Percentage Interests, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind whatsoever which may at any time be
imposed on, incurred by or asserted against either of the Agents or such
Persons relating to or arising out of this Agreement, any other Loan Document,
the transactions contemplated hereby or thereby, or any action taken or omitted
by either of the Agents in connection with any of the foregoing; provided,
however, that the foregoing shall not extend to actions or omissions which are
taken by either or both of the Agents with gross negligence or willful
misconduct.

ARTICLE XI

ASSIGNMENTS/PARTICIPATIONS

11. Successors and Assigns; Bank Assignment and Participations.
Any reference in this Agreement to any party hereto shall be deemed to include
the successors and assigns of such party, and all covenants and agreements by
or on behalf of the Borrower, the Agents or the Banks that are contained in
this Agreement or any other Loan Documents shall bind and inure to the benefit
of their respective successors and assigns; provided, however, that (a) the
Borrower may not assign its rights or obligations under this Agreement except
for mergers or liquidations permitted by Section 7B.7, and (b) the Banks shall
be not entitled to assign their respective Percentage Interests in the Loans
evidenced by the Notes hereunder except as set forth below in this Section 11.

11.1 Assignments by Banks.

11.1.1 Assignees and Assignment Procedures. Each Bank may
(i) without the consent of the Agents or the Borrower if the proposed
assignee is already a Bank hereunder

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or a Wholly Owned Subsidiary of the same corporate parent of which the
assigning Bank is a Subsidiary, or (ii) otherwise with the consents of
the Agents and (so long as no Event of Default exists) the Borrower
(which consents will not be unreasonably withheld), in compliance with
applicable laws in connection with such assignment, assign to one or
more commercial banks or other financial institutions (each, an
"Assignee") all or a portion of its interests, rights and obligations
under this Agreement and the other Loan Documents, including all or a
portion, which need not be pro rata among the Loans and the Letter of
Credit Exposure, of its Commitments, the portion of the Loans and
Letter of Credit Exposure at the time owing to it and the Notes held
by it, but excluding its rights and obligations as one of the Agents;
provided, however, that:

(i) the aggregate amount of the Commitments of the assigning
Bank subject to each such assignment to any Assignee other than
another Bank (determined as of the date the Assignment and Acceptance
with respect to such assignment is delivered to the Administrative
Agent) shall be not less than $1,000,000 and in increments of
$500,000; and

(ii) the parties to each such assignment shall execute and
deliver to the Administrative Agent an Assignment and Acceptance (the
"Assignment and Acceptance") in the form satisfactory to the
Administrative Agent and the Collateral Agent, together with the Note
or Notes subject to such assignment and a processing and recordation
fee of $500 payable to the Administrative Agent by the assigning Bank
or the Assignee.

Upon acceptance and recording pursuant to Section 11.1.4, from
and after the effective date specified in each Assignment and
Acceptance (which effective date shall be at least five (5) Banking
Days after the execution thereof unless waived in writing by the
Administrative Agent):

(A) the Assignee shall be a party hereto and, to the
extent provided in such Assignment and Acceptance,
have the rights and obligations of a Bank under this
Agreement; and

(B) the assigning Bank shall, to the extent provided in
such assignment, be released from its obligations
under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the
remaining portion of an assigning Bank's rights and
obligations under this Agreement, such Bank shall
cease to be a party hereto but shall continue to be
entitled to the benefits of the Applicable Rate
provisions hereof, as well as to any fees accrued for
its account hereunder and not yet paid).

11.1.2 Terms of Assignment and Acceptance. By executing and
delivering an Assignment and Acceptance, the assigning Bank and
Assignee shall be deemed to confirm to and agree with each other and
the other parties hereto as follows:

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(a) other than the representation and warranty that it is
the legal and beneficial owner of the interest being assigned thereby
free and clear of any adverse claim, such assigning Bank makes no
representation or warranty and assumes no responsibility with respect
to any statements, warranties or representations made in or in
connection with this Agreement or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement,
any other Loan Document or any other instrument or document furnished
pursuant hereto;

(b) such assigning Bank makes no representation or
warranty and assumes no responsibility with respect to the financial
condition of the Borrower and its Subsidiaries or the performance or
observance by the Borrower or any of its Subsidiaries of any of its
obligations under this Agreement, any other Loan Document or any other
instrument or document furnished pursuant hereto;

(c) such Assignee confirms that it has received a copy of
this Agreement, together with copies of the most recent quarterly or
annual financial statements delivered pursuant to Section 7A.1 and
such other documents and information as it has deemed appropriate to
make its own credit analysis and decision to enter into such
Assignment and Acceptance;

(d) such Assignee will independently and without reliance
upon the Administrative Agent, such assigning Bank or any other Bank,
and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement;

(e) such Assignee appoints and authorizes the
Administrative Agent to take such action as Administrative Agent on
its behalf and to exercise such powers under this Agreement as are
delegated to the Administrative Agent by the terms hereof, together
with such powers as are reasonably incidental thereto; and

(f) such Assignee agrees that it will perform in
accordance with the terms of this Agreement all the obligations which
are required to be performed by it as a Bank.

11.1.3 Register. The Administrative Agent shall maintain at
its main Boston banking office a register (the "Register") for the
recordation of (a) the names and addresses of the Banks and the
Assignees which assume rights and obligations pursuant to an
assignment under Section 11.1.1, (b) the Percentage Interest of each
such Bank as set forth in Section 11.1 and (c) the amount of the Loans
and Letter of Credit Exposure owing to each Bank from time to time.
The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrower, the Administrative Agent and the
Banks may treat each Person whose name is registered therein for all
purposes as a party to this Agreement. The Register shall be
available for inspection by the Borrower or any Bank at any reasonable
time and from time to time upon reasonable prior notice.

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11.1.4 Acceptance of Assignment and Assumption. Upon its
receipt of a completed Assignment and Acceptance executed by an
assigning Bank and an Assignee, in exchange for the Notes subject to
such assignment, together with the Note or Notes subject to such
assignment, and the processing and recordation fee referred to in
Section 11.1.1, the Administrative Agent shall (a) accept such
Assignment and Acceptance, (b) record the information contained
therein in the Register and (c) give prompt notice thereof to the
Borrower. Within five (5) Business Days after receipt of notice, the
Borrower, at its own expense, shall execute and deliver to the
Administrative Agent, in exchange for the surrendered Note or Notes, a
new Note or Notes to the order of such Assignee in a principal amount
equal to the applicable Commitments and Loans assumed by it pursuant
to such Assignment and Acceptance and, if the assigning Bank has
retained Commitments and Loans, a new Note or Notes to the order of
such assigning Bank in a principal amount equal to the applicable
Commitments and its Percentage Interest in the Loans retained by it.
Such new Note or Notes shall be in an aggregate principal amount equal
to the aggregate principal amount of such surrendered Note or Notes,
and shall be dated the date of the surrendered Note or Notes which it
or they replace. All such Notes so replaced shall be delivered by the
Agent to the Borrower or, alternatively, at the Administrative Agent's
election, marked appropriately to evidence the replacement thereof by
such replacement Note(s).

11.1.5 Federal Reserve Bank. Notwithstanding the foregoing
provisions of this Section 11, any Bank may at any time pledge or
assign all or any portion of such Bank's rights under this Agreement
and the other Loan Documents to a Federal Reserve Bank; provided,
however, that no such pledge or assignment shall release such Bank
from such Bank's obligations hereunder or under any other Loan
Document.

11.1.6 Further Assurances. The Borrower and its Subsidiaries
shall sign such documents and take such other actions from time to
time reasonably requested by an Assignee to enable it to share in the
benefits of the rights created by the Loan Documents.

11.2 Credit Participants. Each Bank may, without the consent of
the Borrower and with the consent of the Administrative Agent, in compliance
with applicable laws in connection with such participation, sell to one or more
commercial banks or other financial institutions (each a "Credit Participant")
participations in all or a portion of its interests, rights and obligations
under this Agreement and the other Loan Documents (including all or a portion
of its Commitments, the Loans and Letter of Credit exposure owing to it and the
Notes held by it); provided, however, that:

(i) such Bank's obligations under this Agreement shall remain
unchanged;

(ii) such Bank shall remain solely responsible to the other parties
hereto for the performance of such obligations;

(iii) the Credit Participant shall be entitled to the benefit of any
cost protection provisions contained in the Credit Agreement, but shall not be
entitled to receive any greater payment

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thereunder than the selling Bank would have been entitled to receive with
respect to the interest so sold if such interest had not been sold; and

(iv) the Borrower, the Administrative Agent and the other Banks
shall continue to deal solely and directly with such Bank in connection with
such Bank's rights and obligations under this Agreement, and such Bank shall
retain the sole right as one of the Banks to vote with respect to the
enforcement of the obligations of the Borrower relating to the Loans and Letter
of Credit Exposure and the approval of any amendment, modification or waiver of
any provision of this Agreement (other than amendments, modifications, consents
or waivers described in Section 10.6(ii)).

Borrower agrees, to the fullest extent permitted by applicable law, that any
Credit Participant and any Bank purchasing a participation from another Bank
pursuant to Section 11.1 may exercise all rights of payment (including the
right of set-off), with respect to its participation as fully as if such Credit
Participant or such Bank were the direct creditor of the Borrower and a Bank
hereunder in the amount of such participation. Upon receipt of notice of the
address of each Credit Participant, the Borrower shall thereafter supply such
Credit Participants with the same information and reports communicated to the
Banks. The Borrower hereby acknowledges and agrees that Credit Participants
shall be deemed a holder of the applicable Notes to the extent of their
respective participation, and the Borrower hereby waives its right, if any, to
offset amounts owing to the Borrower from the Banks against each Credit
Participant's portion of the applicable Notes.

11.3 Replacement of Bank. In the event that any Bank or, to the
extent applicable, any Credit Participant (the "Affected Bank"):

(a) fails to perform its obligations to fund any portion
of the Loans or to issue any Letter of Credit when required to do so
by the term so the Loan Documents, or fails to provide its portion of
any Eurodollar Pricing Option pursuant to Section 3.2.1 or on account
of a Bank Legal Requirement as contemplated by Section 3.2.5;

(b) demands payment under the Reserve provisions of
Section 3.5, the Tax provisions of Section 3.6, the Capital Adequacy
provisions of Section 3.7 or the Regulatory Change provisions in
Section 3.8 in an amount the Borrower deems materially in excess of
the amounts with respect thereto demanded by the other Banks;

(d) refuses to consent to a proposed amendment,
modification, waiver or other action requiring consent of the holders
of 100% of the Percentage Interests under Section 10.6(b) that is
consented to by the other Banks;

then, so long as no Event of Default exists, the Borrower shall have the right
to seek a replacement Bank which is reasonably satisfactory to the
Administrative Agent (the "Replacement Bank"). The Replacement Bank shall
purchase the interests of the Affected Bank in the Loans, Letters of Credit and
its Commitments and shall assume the obligations of the Affected Bank hereunder
and under

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the other Loan Documents upon execution by the Replacement Bank of an
Assignment and Acceptance and the tender by it to the Affected Bank of a
purchase price agreed between it and the Affected Bank (or, if they are unable
to agree, a purchase price in the amount of the Affected Bank's Percentage
Interest in the Loans and Letter of Credit Exposure, or appropriate credit
support for contingent amounts included therein, and all other outstanding
Credit Obligations then owed to the Affected Bank). Such assignment by the
Affected Bank shall be deemed an early termination of any Eurodollar Pricing
Option to the extent of the Affected Bank's portion thereof, and the Borrower
will pay to the Affected Bank any resulting amounts due under Section 3.2.4.
Upon consummation of such assignment, the Replacement Bank shall become party
to this Agreement as a signatory hereto and shall have all the rights and
obligations of the Affected Bank under this Agreement and the other Loan
Documents with a Percentage Interest equal to the Percentage Interest of the
Affected Bank, the Affected Bank shall be released from its obligations
hereunder and under the Loan Documents, and no further consent or action by any
party shall be required. Upon the consummation of such assignment, the
Borrower, the Administrative Agent and the Affected Bank shall make appropriate
arrangements so that a new Notes are issued to the Replacement Bank. The
Borrower shall sign such documents and take such other actions reasonably
requested by the Replacement Bank to enable it to share in the benefits of the
rights created by the Loan Documents. Until the consummation of an assignment
in accordance with the foregoing provisions of this Section 11.3, the Borrower
shall continue to pay the Affected Bank any Loan Obligations as they become due
and payable.

11.4 Sale of a Certain Participation. The Borrower, the Agents and
the Banks recognize and acknowledge that the BOk is selling a participating
interest in its Notes to The Stillwater National Bank and Trust Company.

ARTICLE XII

MISCELLANEOUS

12.1 Notices. Unless otherwise provided herein, all notices,
requests, consents and demands shall be in writing and shall be either
hand-delivered (by courier or otherwise) or mailed by certified mail, postage
prepaid, or sent by facsimile transmission (confirmed as aforesaid) to the
respective addresses specified below, or, as to any party, to such other
address as may be designated by it in notice to the other parties in accordance
with this Section 12.1:

If to the Borrower, to:

Heritage Operating, L.P.
0000 Xxxxx Xxxx Xxxxxx, Xxxxx 000
Xxxxx, Xxxxxxxx 00000
Attn: Chief Financial Officer
FAX: (000) 000-0000

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If to the Banks, to:

The First National Bank of Boston
Mail Stop: 01-08-02
000 Xxxxxxx Xxxxxx, X.X. Xxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Energy and Utilities Division
FAX: (000) 000-0000
Telex: 940581

Bank of Oklahoma, National Association
P. O. Box 2300
Bank of Oklahoma Tower
Xxx Xxxxxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Attn: Corporate Department - 8th Floor
FAX: (000) 000-0000

The Administrative Agent is hereby designated and appointed and shall serve as
notice agent for all of the Banks insofar as notices hereunder are concerned
and notice to the Administrative Agent shall be deemed notice to each of the
Banks with the same force and effect as if each such Bank were individually
notified in accordance herewith. All notices, requests, consents and demands
hereunder will be effective when hand-delivered to the applicable notice
address set forth above or when mailed by certified mail, postage prepaid,
addressed as aforesaid.

12.2 Place of Payment. All sums payable hereunder shall be paid in
immediately available funds to the Administrative Agent, at the Boston Office,
or at such other place as the Administrative Agent shall notify the Borrower in
writing. If any interest, principal or other payment falls due on a date other
than a Business Day, then (unless otherwise provided herein) such due date
shall be extended to the next succeeding Business Day, and such extension of
time will in such case be included in computing interest, if any, in connection
with such payment.

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12.3 Survival of Agreements. All covenants, agreements,
representations and warranties made herein shall survive the execution and the
delivery of Loan Documents. All statements contained in any certificate or
other instrument delivered by the Borrower hereunder shall be deemed to
constitute representations and warranties by the Borrower.

12.4 Parties in Interest. All covenants, agreements and
obligations contained in this Agreement shall bind and inure to the benefit of
the respective successors and assigns of the parties hereto, except that the
Borrower may not assign their rights or obligations hereunder without the prior
written consent of the Banks.

12.5 Governing Law and Jurisdiction. This Agreement and the Notes
shall be deemed to have been made or incurred and delivered under the laws of
the State of Oklahoma and shall be construed and enforced in accordance with
and governed by the Laws of Oklahoma.

12.6 SUBMISSION TO JURISDICTION. THE BORROWER HEREBY CONSENTS TO
THE JURISDICTION OF ANY OF THE LOCAL, STATE, AND FEDERAL COURTS LOCATED WITHIN
TULSA COUNTY, OKLAHOMA OR BOSTON, MASSACHUSETTS AND WAIVE ANY OBJECTION WHICH
BORROWER MAY HAVE BASED ON IMPROPER VENUE OR FORUM NON CONVENIENS TO THE
CONDUCT OF ANY PROCEEDING IN ANY SUCH COURT AND WAIVES PERSONAL SERVICE OF ANY
AND ALL PROCESS UPON ANY OF THEM, AND CONSENT THAT ALL SUCH SERVICE OF PROCESS
BE MADE BY MAIL OR MESSENGER DIRECTED TO ANY OF THEM AT THE ADDRESS SET FORTH
IN SUBSECTION 12.1 HEREOF AND THAT SERVICE SO MADE SHALL BE DEEMED TO BE
COMPLETED UPON THE EARLIER OF ACTUAL RECEIPT OR THREE (3) BUSINESS DAYS AFTER
MAILED OR DELIVERED BY MESSENGER.

12.7 Maximum Interest Rate. Regardless of any provision herein,
the Banks shall never be entitled to receive, collect or apply, as interest on
the Indebtedness any amount in excess of the maximum rate of interest permitted
to be charged by the Banks by applicable Law, and, in the event the Banks shall
ever receive, collect or apply, as interest, any such excess, such amount which
would be excessive interest shall be applied to other Indebtedness and then to
the reduction of principal; and, if all other Indebtedness and principal are
paid in full, then any remaining excess shall forthwith be paid to the
Borrower.

12.8 No Waiver; Cumulative Remedies. No failure to exercise, and
no delay in exercising, on the part of the Banks, any right, power or privilege
hereunder or under any other Loan Document or applicable Law shall preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege of the Banks. The rights and remedies herein provided are cumulative
and not exclusive of any other rights or remedies provided by any other
instrument or by law. No amendment, modification or waiver of any provision of
this Agreement or any other Loan Document shall be effective unless the same
shall be in writing and signed by the Banks. No notice to or demand on the
Borrower in any case shall entitle the Borrower to any other or further notice
or demand in similar or other circumstances.

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12.9 Costs. The Borrower agrees to pay to the Banks on demand all
reasonable costs, fees and expenses (including without limitation reasonable
attorneys fees and legal expenses) incurred or accrued by the Banks in
connection with the negotiation, preparation, execution, delivery, filing,
recording, facilitation and administration of this Agreement, the Notes, the
Security Documents, the Intercreditor Agreement and the other Loan Documents,
or any amendment, waiver, consent or modification thereto or thereof, or any
enforcement thereof. The Borrower further agrees that the fees and expenses of
the Banks, including the Agents, incurred in connection with the negotiation
and preparation of this Agreement and the other Loan Documents shall be paid
regardless of whether or not the transactions provided for in this Agreement
are eventually closed and regardless of whether or not any or all sums
evidenced by the Notes are advanced to the Borrower by the Banks.

12.10 WAIVER OF JURY. BORROWER FULLY, VOLUNTARILY AND EXPRESSLY
WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR
DEFEND ANY RIGHTS UNDER THIS AGREEMENT OR UNDER ANY AMENDMENT, INSTRUMENT,
DOCUMENT OR AGREEMENT DELIVERED (OR WHICH MAY IN THE FUTURE BE DELIVERED) IN
CONNECTION HEREWITH OR ARISING FROM ANY BANKING RELATIONSHIP EXISTING IN
CONNECTION WITH THIS AGREEMENT, THE NOTES OR THE SECURITY DOCUMENTS. BORROWER
AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT
BEFORE A JURY.

Borrower acknowledges that it have been informed by the Agents that
the provisions of this Section 12.10 constitute a material inducement upon
which each of the Banks has relied and will rely in entering into this
Agreement and the other Loan Documents, and that Borrower has reviewed the
provisions of this Section 12.10 with its legal counsel. Any of the Banks, the
Agents or the Borrower may file an original counterpart or copy of this Section
12.10 with any court or Tribunal as written evidence of the express consent of
the Borrower, the Agents and the Banks to the waiver of their rights to trial
by jury.

12.11 Full Agreement. This Agreement and the other Loan Documents
contain the full agreement of the parties and supersede all negotiations and
agreements prior to the date hereof.

12.12 Headings. The article and section headings of this Agreement
are for convenience of reference only and shall not constitute a part of the
text hereof nor alter or otherwise affect the meaning hereof.

12.13 Severability. The unenforceability or invalidity as
determined by a court of competent jurisdiction, of any provision or provisions
of this Agreement shall not render unenforceable or invalid any other provision
or provisions hereof.

12.14 Exceptions to Covenants. The Borrower shall not be deemed to
be permitted to take any action or fail to take any action which is permitted
as an exception to any of the covenants contained herein or which is within the
permissible limits of any of the covenants contained herein if such action or
omission would result in the breach of any other covenant contained herein.

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12.15 Conflict with Security Documents. To the extent the terms and
provisions of any of the Security Documents are in conflict with the terms and
provisions hereof, this Agreement shall be deemed controlling.

12.16 Confidentiality. Each Bank will make no disclosure of
confidential information furnished to it by the Borrower or any of its
Subsidiaries unless such information shall have become public, except:

(i) in connection with operations under or the enforcement of this
Agreement or any other Loan Document;

(ii) pursuant to any statutory or regulatory requirement or any
mandatory court order, subpoena or other legal process;

(iii) to any parent or corporate Affiliate of such Bank or to any
Credit Participant, proposed Credit Participant or proposed Assignee; provided,
however, that any such Person shall agree to comply with the restrictions set
forth in this Section 12.16 with respect to such information;

(iv) to its independent counsel, auditors and other professional
advisors with an instruction to such Person to keep such information
confidential; and

(v) with the prior written consent of the Borrower, to any other
Person.

12.17 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument.

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered in Tulsa, Oklahoma, effective as of the day and
year first above written.

"Borrower"

HERITAGE OPERATING, L.P., a Delaware
limited partnership

By: Heritage Holdings, Inc.,
a Delaware corporation,
general partner

By /s/ H. XXXXXXX XXXXXXXX
----------------------------
H. Xxxxxxx Xxxxxxxx
Chief Financial Officer

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Tulsa, Oklahoma, effective as of the day and
year first above written.

"Banks"

THE FIRST NATIONAL BANK OF BOSTON

By /s/ H. XXXXX XXXXXX
-------------------------------------
H. Xxxxx Xxxxxx, Managing Director

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Tulsa, Oklahoma, effective as of the day and
year first above written.

BANK OF OKLAHOMA, NATIONAL
ASSOCIATION

By /s/ XXXXXX X. XXXXXX
-------------------------------------
Xxxxxx X. Xxxxxx, Vice President

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Tulsa, Oklahoma, effective as of the day and
year first above written.

"Administrative Agent"

THE FIRST NATIONAL BANK OF BOSTON

By /s/ H. XXXXX XXXXXX
-------------------------------------
H. Xxxxx Xxxxxx, Managing Director

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107
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Tulsa, Oklahoma, effective as of the day and
year first above written.

"Documentation Agent"

BANK OF OKLAHOMA, NATIONAL
ASSOCIATION

By /s/ XXXXXX X. XXXXXX
-------------------------------------
Xxxxxx X. Xxxxxx, Vice President

-101-
108
EXHIBIT 2.1.3

ACQUISITION
LOAN ADVANCE REQUEST

The First National Bank of Boston
Energy & Utilities Division
000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000

(Administrative Agent for The First National Bank
of Boston and Bank of Oklahoma, National Association)

(Collectively the "Banks")

Gentlemen:

Pursuant to the provisions of the Credit Agreement dated as of June 25,
1996 (the "Credit Agreement"), between HERITAGE OPERATING, L.P. (the
"Borrower"), The First National Bank of Boston, as administrative agent for the
Banks (therein described and defined) and the Banks, the Borrower hereby (i)
confirms and ratifies the Collateral Agent's continuing security interest in
the Collateral; (ii) applies to you for an Acquisition Loan on the Acquisition
Facility in the amount of $_________ (Line 2 below); (iii) certifies that no
Event of Default or Default under the Credit Agreement has occurred and is
continuing as of the date hereof; (iv) represents and warrants to you that the
representations, covenants and warranties set forth or referred to in the
Credit Agreement are true and correct in all material respects on and as of
this date unless such representation or warranty relate only to an earlier
date; and (v) certifies to you the accuracy of the following information
concerning the Acquisition Notes:

1. Existing Acquisition Loan Credit (not to $_______________
exceed $25,000,000
2. Plus: Acquisition Loan requested $_______________
OR
3. Less: Additional Payment $_______________
4. New Acquisition Note Balance $_______________
Line 1 plus Line 2 or less
Line 3, but not to exceed
$35,000,000

IN WITNESS WHEREOF, the undersigned has hereunto set his hand this
________ day of ______________________________, 199_____.

HERITAGE OPERATING, L.P.,
a Delaware limited partnership

By: Heritage Holdings, Inc., a
Delaware corporation, general
partner

By:
---------------------------
(Title)

109
EXHIBIT 2.1.4

PROMISSORY NOTE
(Acquisition Note)
[$12,500,000.00] Boston, Massachusetts
June 28, 1996

FOR VALUE RECEIVED, HERITAGE OPERATING, L.P., a Delaware limited
partnership (the "Borrower"), hereby promises to pay to the order of [THE FIRST
NATIONAL BANK OF BOSTON ("Bank of Boston")], at Bank of Boston's principal
banking offices in Boston, Massachusetts in lawful money of the United States
of America, the principal sum of [TWELVE MILLION FIVE HUNDRED THOUSAND] and
NO/100 DOLLARS ($[12],500,000.00) or so much thereof as shall have been
advanced hereunder and remains unpaid on June 30, 2001, with the outstanding
unpaid balance hereof on December 31, 1998 ("Conversion Date") being converted
to a thirty (30) month term payout, payable in ten (10) consecutive quarterly
installments of principal each in an amount equal to one-tenth (1/10th) of the
outstanding principal balance hereof on the Conversion Date, and due on the
last day of each calendar quarter commencing March 31, 1999, together with
interest thereon on unpaid balances of principal from time to time outstanding
and on any past due interest, payable at the Applicable Rate per annum
determined pursuant to the Credit Agreement (as defined hereinafter) in
accordance with Section 3.1 thereof, through and including the Conversion Date,
and thereafter due on the same date quarterly principal payments are payable,
commencing March 31, 1999, with a final payment of all unpaid principal and
accrued interest due and payable at final maturity on June 30, 2001. Interest
shall accrue on the unpaid balance of principal from time to time outstanding
and on any past due interest at the Applicable Rate per annum determined
pursuant to the Credit Agreement (as defined hereinafter) which interest is due
and payable as therein provided. All payments under this Note shall be applied
first to unpaid accrued interest and then to outstanding principal.

After default in the payment of any amount of principal or interest
owing hereunder (whether on maturity, acceleration or otherwise) or upon the
occurrence of any other Event of Default as described in the Credit Agreement,
the entire unpaid principal and accrued and unpaid interest hereunder shall, at
the sole option of the Banks, be accelerated and immediately become due and
payable without notice by Bank of Boston, and the unpaid principal amount
hereof shall bear interest computed at the Default Rate as defined in the
Credit Agreement, but in no event at a rate which is greater than permitted by
applicable law. Upon default in the payment of any amount of interest payable
hereunder, such interest shall, to the full extent permitted by law, bear
interest at the same rate as principal.

This Note is made pursuant to the Credit Agreement, dated as of June
25, 1996, among the Borrower, Bank of Boston, as Administrative Agent for the
Banks (as hereinafter defined), Bank of Oklahoma, National Association, as
Documentation Agent for the Banks, and Bank of Boston and BOk (collectively the
"Banks") (said Credit Agreement as the same may at any time hereafter be
amended, supplemented or modified and in effect being herein called the "Credit
Agreement"), and is one of the Acquisition Notes described and defined therein.
The Credit Agreement, among other things, contains provisions concerning the
maximum Acquisition Facility borrowings and adjustments thereto, for certain
rights of setoff, acceleration of the maturity hereof
110
Acquisitions Note
Page 2

upon the events, terms and conditions therein specified, loan origination and
commitment fees, mandatory principal prepayments and voluntary prepayments
hereof.

This Note is secured by the Collateral described in the Security
Agreement described and defined in the Credit Agreement which have been
executed by the Borrower and Heritage Holdings, Inc. ("Heritage") and delivered
to the Collateral Agent subject to the terms and provisions of the
Intercreditor Agreement defined in the Credit Agreement. Reference is hereby
made to the Security Agreement for a description of the Collateral interests
thereby conveyed, pledged and/or assigned, as the case may be, the nature and
extent of the security thereunder and the security interests created thereby.

Should the indebtedness represented by this Note or any part thereof
be collected at law or in equity or in bankruptcy, receivership or other court
proceedings or this Note be placed in the hands of attorneys for collection
after default, the Borrower agrees to pay hereunder, in addition to the
principal and interest due and payable hereon, reasonable attorneys' fees,
court costs and other collection expenses incurred by the holder hereof.

The Borrower hereby waives presentment for payment, demand, notice of
nonpayment, protest and notice of protest with respect to any payment hereunder
and agrees to any extension of time with respect to any payment due hereunder,
to any substitution or release of the security or collateral described in the
Security Agreement and to the addition or release of any party liable
hereunder. No delay on the part of the holder hereof in exercising any rights
hereunder shall operate as a waiver of such rights.

This Note and the indebtedness evidenced hereby shall be construed
and enforced in accordance with and governed by the laws of the State of
Oklahoma and is delivered to the order of [Bank of Boston] by the undersigned
duly authorized corporate officer of the sole general partner of the Borrower.

"Borrower"

HERITAGE OPERATING, L.P.,
a Delaware limited partnership

By: Heritage Holdings, Inc.,
a Delaware corporation,
general partner

By
----------------------------
H. Xxxxxxx Xxxxxxxx,
Chief Financial Officer
DUE: June 30, 2001 (the
(converting to a 30 month term payout
as of December 31, 1998)
111
EXHIBIT 2.2.3

LOAN ADVANCE REQUEST
(WORKING CAPITAL CREDIT LOANS)

The First National Bank of Boston
Energy & Utilities Division
000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000

(Administrative Agent for The First National Bank
of Boston
and Bank of Oklahoma, National Association)

(Collectively the "Banks")

Gentlemen:

Pursuant to the provisions of the Credit Agreement dated as of June 25,
1996 (the "Credit Agreement"), among HERITAGE OPERATING, L.P. ("Borrower"), The
First National Bank of Boston, as administrative agent for the Banks (therein
described and defined) and the Banks, the Borrower hereby (i) confirms and
ratifies the Collateral Agent's continuing security interest the Collateral;
(ii) applies to you for a Working Capital Loan on the Working Capital Facility
in the amount of $_________ (Line 2 below); (iii) certifies that no Event of
Default or Default under the Credit Agreement has occurred and is continuing as
of the date hereof; (iv) represents and warrants to you that the
representations, covenants and warranties set forth or referred to in the
Credit Agreement are true and correct in all material respects on and as of
this date; and (v) certifies to you the accuracy of the following information
concerning the Working Capital Notes:

1. Existing Working Capital Facility Loan Balance $____________
(not to exceed $15,000,000 minus outstanding
principal balance of Section 7B.2(v)
Indebtedness)
2. Plus: Working Capital Loan requested $____________
OR
3. Less: Additional Payment $____________
4. New Working Capital Notes Balance
Line 1 plus Line 2 or less Line 3,
but not to exceed $15,000,000 minus sum of (x)
Letter of Credit Exposure plus (y) outstanding
principal balance of Section 7B.2(v)
Indebtedness $____________

IN WITNESS WHEREOF, the undersigned has hereunto set his hand this
________ day of ______________________________, 199_____.

HERITAGE OPERATING, L.P.,
a Delaware limited partnership

By: Heritage Holdings, Inc., a
Delaware corporation, general
partner

By:
---------------------------
(Title)
112
EXHIBIT 2.2.4

WORKING CAPITAL NOTE

[$7,500,000.00] Boston, Massachusetts
June 28, 1996

FOR VALUE RECEIVED, HERITAGE OPERATING, L.P., a Delaware limited
partnership (the "Borrower"), hereby promises to pay to the order of [THE FIRST
NATIONAL BANK OF BOSTON ("First Boston")] at Bank of Boston's principal banking
offices in Boston, Massachusetts, in lawful money of the United States of
America, the principal sum of [SEVEN MILLION FIVE HUNDRED THOUSAND] and NO/100
DOLLARS ($[7,5]00,000.00), or so much thereof as shall have been advanced
hereunder and remains unpaid, on June 30, 1999, together with interest thereon
from the date hereof on the unpaid balance of principal from time to time
outstanding and on any past due interest, at the Applicable Rate per annum
determined pursuant to the Credit Agreement (as defined hereinafter), which
interest is due and payable as therein provided in Section 3.1, and at final
maturity on June 30, 1999.

After default in the payment of any amount of principal or interest
owing hereunder (whether on maturity, acceleration or otherwise) or upon the
occurrence of any other Event of Default as described in the Credit Agreement,
the entire unpaid principal and accrued and unpaid interest hereunder shall, at
the sole option of First Boston, be accelerated and immediately become due and
payable without notice by First Boston, and the unpaid principal amount hereof
shall bear interest computed at a Default Rate as defined in the Credit
Agreement, but in no event at a rate which is greater than permitted by
applicable law. Upon default in the payment of any amount of interest payable
hereunder, such interest shall, to the full extent permitted by law, bear
interest at the same rate as principal.

This Note is made pursuant to the Credit Agreement, dated as of June
25, 1996, between and among Borrower, Bank of Boston, as Administrative Agent
for the Banks (as hereinafter defined), Bank of Oklahoma, National Association,
as Documentation Agent for the Banks, Bank of Boston and BOK (collectively the
"Banks") (said Credit Agreement, as the same may at any time hereafter be
amended, supplemented or modified and in effect being herein called the "Credit
Agreement"), and is one of the Working Capital Notes therein described. The
Credit Agreement, among other things, contains provisions for reduction of the
maximum availability under the Working Capital Loan Facility pursuant to
Section 2.2.1 and the Letter of Credit Exposure, certain rights of setoff,
acceleration of the maturity hereof upon the events, terms and conditions
therein specified, commitment fees, mandatory principal payments and voluntary
prepayments hereof.

This Note is secured by the Collateral described in the Security
Agreement described and defined in the Credit Agreement, including all
supplements thereof and/or amendments thereto, which have been executed by the
Borrower and Heritage Holdings, Inc. ("Heritage") and delivered to the
Collateral Agent subject to the terms and provisions of the Intercreditor
Agreement defined in the Credit Agreement. Reference is hereby made to the
Security Agreement for a description of the Collateral interests thereby
conveyed, pledged and/or assigned, as the case may be, the nature and extent of
the security thereunder and the security interests created thereby.

The Borrower hereby waives presentment for payment, demand, notice of
nonpayment, protest and notice of protest with respect to any payment hereunder
and agrees to any extension of time with respect to any payment due hereunder,
to any substitution or release of the security or Collateral described in the
Security Agreement and to the addition or release of any party liable
hereunder. No delay on the part of the holder hereof in exercising any rights
hereunder shall operate as a waiver of such rights.

The indebtedness evidenced hereby shall be construed and enforced in
accordance with and governed by the laws of the State of Oklahoma and is
delivered to the order of [Bank of Boston], by the undersigned duly authorized
corporate officer of the sole general partner of the Borrower.

"Borrower"

HERITAGE OPERATING, L.P., a Delaware
limited partnership

By: Heritage Holdings, Inc.,
a Delaware corporation,
general partner

By
----------------------------
H. Xxxxxxx Xxxxxxxx,
Chief Financial Officer

DUE: June 30, 1999

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CREDIT AGREEMENT DATED AS OF JUNE 25, 1996 BETWEEN AND AMONG HERITAGE OPERATING, L.P., A DELAWARE LIMITED PARTNERSHIP

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