2ND Amended Restricted Unit Plan

HERITAGE PROPANE PARTNERS, L.P.
SECOND AMENDED AND RESTATED
RESTRICTED UNIT PLAN


Heritage Holdings, Inc., a Delaware corporation ("HHI"), as General Partner of Heritage Propane Partners, L.P. (the "Partnership"), established the Heritage Propane Partners, L.P. Restricted Unit Plan effective as of the effective date of the initial public offering of Units of the Partnership, which was amended and restated as of the 10th day of August, 2000 upon approval of the Board of Directors of HHI, and Amended and Restated as of February 4, 2002, effective upon the approval of the Common Unitholders to the change of the General Partner from HHI to U.S. Propane, L.P. (the "Company") (collectively, the "Plan"). Prior to February 4, 2002, the general partner of the Partnership was HHI, and thereafter the general partner is the Company.


1. Purpose. The purpose of the Plan is to promote the interests of the General Partner and the Partnership by encouraging key employees of the General Partner of the Partnership, its Subsidiaries and Affiliates, and the Directors of the Company and their successors to acquire or increase their ownership of Units and to provide a means whereby such individuals may develop a sense of proprietorship and personal involvement in the development and financial success of the Partnership, and to encourage them to devote their best efforts to the business of the Partnership, thereby advancing the interests of the Partnership and the Company.


2. Definitions. As used in this Plan:


(a) "Affiliate" means any person that directly or indirectly controls, is controlled by, or is under common control with the person in question. As used in this definition, the term "control" means the possession, directly or indirectly, of the power to direct or cause a direction of the management and policies of a person whether through ownership of voting securities, by contract or otherwise. When used with reference to any individual, the term "Affiliate" shall also mean any person that is a relative (within the second degree consanguinity) or spouse of such individual or is a guardian of such individual or such spouse or is a trust or estate in which such individual owns a 5% or greater beneficial interest or of which such individual serves as trustee, executor or in any similar capacity.


(b) "Board" means the Board of Directors of HHI prior to February 4, 2002 and the Board of Managers of the Company thereafter.


(c) "Change in Control" means any of:


(i) the date that the Parents cease to own, directly or
indirectly through wholly-owned subsidiaries, in the aggregate of at
least 51% of the capital stock or equity interest of the General
Partner; or


(ii) the sale of all or substantially all of the assets of the
Partnership (other than to any affiliate of any of the Parents; or


(iii) a liquidation or dissolution of the Partnership.


(d) "Committee" means the committee appointed to administer the Plan pursuant to Paragraph 10.


(e) "Date of Grant" means (i) with respect to a grant of Phantom Units to an Employee, the date specified by the Committee on which such grant is effective and (ii) with respect to a grant of Phantom Units to a Director, the automatic date of grant as provided in Paragraph 5.


(f) "Director" means a director of the General Partner, or other similar manager of the governing body of the General Partner if the General Partner is not a corporation, who is not also a direct or indirect employee of any Parent, the Company, a Subsidiary or the Partnership.


(g) "Employee" means any individual who is an employee of the Company, a Subsidiary or the Partnership or an Affiliate of any such entity rendering his or her primary service to the Partnership.


(h) "General Partner" means the general partner of Heritage Propane Partners, L.P.


(i) "Parents" means collectively, AGL Resources, Inc., Atmos Energy Corporation, Piedmont Natural Gas Company, Inc., and TECO Energy.


(j) "Participant" means an Employee who is selected by the Committee to receive a grant of Phantom Units and shall also include a Director who has received an automatic grant of Phantom Units pursuant to Paragraph 5.


(k) "Partnership" means Heritage Propane Partners L.P.


(l) "Phantom Units" means a notional Unit granted under the Plan, which upon vesting entitles the Participant to receive a Unit.


(m) "Units" means a limited partnership interest in the Partnership represented by Common Units as set forth in the Partnership Agreement as the securities of the Partnership.


(n) "Rule 16b-3" means Rule 16b-3 of the Securities and Exchange Commission (or any successor rule to the same effect) as in effect from time to time.


(o) "Subsidiary" means any entity in which, at the relevant time the General Partner or Partnership owns or controls, directly or indirectly, not less than 50% of the total combined voting power represented by all classes of equity interests issued by such entity.


3. Units Available Under Plan. Subject to adjustments as provided in Paragraph 7, the maximum number of Phantom Units that may be granted under this Plan is 146,000; provided, however, any Phantom Units that are forfeited or which expire for any reason will again be


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available for grant under this Plan. Units to be delivered upon the vesting of Phantom Units granted under the Plan may be Units acquired by the Company in the open market, Units already owned by the Company, Units acquired by the Company directly from the Partnership, or any other person, or any combination of the foregoing. ...