Services Outsourcing Agreement

SERVICES OUTSOURCING AGREEMENT


BETWEEN


Mobil Diesel Supply Corporation


AND


Petro Stopping Centers, L.P.


Mobil Diesel Supply Corporation


SERVICES OUTSOURCING AGREEMENT


This Mobil Diesel Supply Corporation Services Outsourcing Agreement ("Agreement") is made effective as of the June 1, 2001 by and between Mobil Diesel Supply Corporation, a corporation having an office at 3225 Gallows Road, Fairfax, Virginia 22037, acting for and on behalf of ExxonMobil Oil Corporation (hereinafter called "MDS"), and Petro Stopping Centers L.P., a Limited Partnership with its principal place of business at 6080 Surety Drive, El Paso, Texas 79905, (hereinafter called "Petro")


PRELIMINARY STATEMENTS


1. Petro operates and is the franchisor of large, multi-service truck stops in
the United States, which are known as "Petro Stopping Centers." Petro
Stopping Centers offer a broad range of products, services and amenities,
including diesel fuel, gasoline, truck preventive maintenance centers,
home-style restaurants, and retail merchandise stores to the professional
truck driver industry and other highway motorists.


2. Petro is a major reseller of Mobil branded diesel fuel, gasoline and
lubricants. A PMPA Motor Fuels Franchise Agreement (hereinafter called
"Franchise Agreement") is in place between ExxonMobil Oil Corporation
(formerly Mobil Oil Corporation, hereinafter called "Mobil Oil") and Petro
under which Petro purchases diesel fuel and gasoline from Mobil Oil for
resale under the Mobil brand. A Master Supply Agreement for the Resale Of
Oil And Greases is also in place between Mobil Oil and Petro under which
Petro purchases lubricants from Mobil Oil for resale under the Mobil brand.


3. Mobil Long Haul, Inc. a wholly-owned subsidiary of Exxon Mobil Corporation,
is one of the partners in Petro Stopping Centers Holdings ,L.P. and
accordingly holds 2 board of director positions on the Petro Board.


4. MDS is a wholly-owned subsidiary of ExxonMobil Oil Corporation formed in
1997 principally to purchase unbranded diesel fuel at the request of Mobil
Oil from third party suppliers, brand such diesel fuel "Mobil" and then
sell the Mobil branded diesel fuel to Petro for resale under the Mobil
brand in accordance with the Franchise Agreement. MDS's principal purpose
is to act for and on behalf of Mobil Oil in an effort to provide Petro with
Mobil branded diesel fuel to meet Mobil Oil's obligations to sell such
diesel fuel under the Franchise Agreement not otherwise supplied directly
by Mobil Oil under the Franchise Agreement. The Mobil branded diesel fuel
is sold by MDS to Petro at cost. MDS does not anticipate profits, and
operational expenses should be minimized. At Mobil Oil's request, MDS also
sells to Petro Mobil branded diesel and gasoline, sourced from Mobil Oil,
for resale by Petro under the Mobil brand in accordance with the Franchise
Agreement.


5. Petro has been providing the majority of the services from MDS described in
the work (as defined below) since March 1997. MDS has received assurances
from Petro that Petro can continue to provide these services, which include
fuel procurement, accounting and administrative services to MDS.
Consequently, MDS now wishes to contract with Petro for the provision of
such services all in accordance with this Agreement.


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NOW, THEREFORE, in consideration of the mutual promises, covenants and conditions set forth in this Agreement, and other valuable consideration, the receipt and sufficiency of which are acknowledged by the parties, MDS and Petro hereby agree as follows:


Article 1: Scope of Work


1.1 Work


Petro shall perform all fuel procurement, accounting and administrative tasks associated with the day to day operations of MDS more particularly described in Schedule A and summarized on Schedule C attached hereto and incorporated herein, together with any other related services requested by MDS from time to time and as mutually agreed by the parties (hereinafter called the "Work"). The Work shall use the processes described in a separate Procedures Manual prepared by MDS and Petro which may be modified from time to time by mutual agreement of the parties (hereinafter called the "Manual") a copy of which is attached hereto as Exhibit C.


1.2 Policies and Procedures


Petro shall perform the Work in accordance with this Agreement and the processes and procedures described in the Manual.


Article 2: Term


This Agreement shall commence on June 1, 2001 (hereinafter referred to as the "Commencement Date"), and, subject to the termination rights otherwise set out in this Agreement, shall expire at midnight on July 22, 2009 ("hereinafter referred to as the "Expiry Date"). This Agreement is tied to the Franchise Agreement, and accordingly may be extended for one ten (10) year period at MDS's discretion upon providing Petro with no less than 180 days written notice prior to the Expiry Date, to the extent the terms of the Franchise Agreement are so extended.


Article 3: Relationship of Parties


3.1 Independent Contractor


Petro and MDS acknowledge and agree that this Agreement is not and shall not be construed as an agreement of joint venture, partnership, agency, franchise or employment between the parties or their respective employees. Petro has sole authority and responsibility to employ, discharge and otherwise control its employees, and neither Petro, nor any of its officers, directors, employees, agents, contractors or other representatives ("Representatives") are or shall be deemed to be employees of MDS. Petro agrees to comply with all laws, statutes, regulations, rules rulings, ordinances, standards and/or directives of all federal, state, county, municipal and/or local government departments and/or agencies applicable to it as such employer. The parties acknowledge and agree that Petro is an INDEPENDENT OPERATOR whose operations are independent, separate, and apart from those of MDS.


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3.2 Taxes


Petro agrees that all of Petro's employees and/or other Representatives assigned to perform the Work for MDS under this Agreement shall be employees and/or other Representatives of Petro and not employees or other Representatives of MDS for any purposes whatsoever. Petro shall be exclusively responsible for filing all applicable tax returns and reports and for withholding and/or paying applicable federal, state, and local taxes (including but not limited to wage and employment taxes, sales taxes, capital gains taxes, personal property taxes, franchise taxes, income taxes, gross receipts taxes, taxes measured by gross income, social security taxes and unemployment taxes for Petro or Petro's employees and/or other Representatives) to which Petro may be subject for the Work performed under this Agreement.


3.3 Taxpayer Identification No.


Petro's taxpayer identification number is 742628339.


3.4 Petro Employees


As used in this Agreement, "Petro employee" shall mean an employee of Petro or of any of its Affiliates, to the extent employed for the purpose of performing any of the Work.


3.5 Consideration


In consideration of the work to be performed by Petro, on behalf of MDS hereunder, MDS shall pay to Petro the amount of $ 5,000.00 annually, said amount to be due within 30 days of the Commencement Date for the first twelve month term of this Agreement and for each subsequent period within 30 days of the anniversary of the Commencement Date, with the amount prorated if the final period is less than one year.


Article 4: Representations and Warranties


4.1 Petro represents, warrants and covenants that:


(a) Good Standing: Petro is a limited partnership, validly existing and in
good standing under the laws of the State of Delaware.


(b) Organization: Petro has the partnership power and authority to perform
its Work and obligations hereunder, and to consummate the transactions
contemplated hereby.


(c) Due Authorization: The execution and delivery of this Agreement and
the consummation and performance of the Work, obligations and
transactions contemplated herein have been duly and validly authorized
by all requisite partnership action.


(d) Binding Obligation: When duly executed and delivered by the parties
hereto, this Agreement will constitute the valid and legally binding
obligation of Petro and will be enforceable against Petro in
accordance with its terms, subject to bankruptcy, insolvency,
reorganization or other laws relating to or affecting the enforcement
of the rights of creditors generally.


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(e) No Conflict: Upon approval by its Board of Directors which, by Petro's
execution of this Agreement shall be deemed to have been provided as
at the date hereof, the execution and delivery of this Agreement, the
consummation and performance of the Work, obligations and transactions
contemplated hereby, and compliance by Petro with any of the
provisions hereof will not violate, or conflict with, or require a
consent, waiver, or approval under, or result in a breach of any
provisions of, or constitute a default under, any of the terms,
conditions or provisions of any contract, agreement or other
instrument or obligation of any nature whatsoever to which Petro, or
any Affiliate is a party. All consents, waivers, and approvals if any
requested by Petro to enter into this Agreement have been obtained.


(f) Compliance with Laws: To the best of Petro's knowledge, Petro is in
material compliance with all applicable laws, statutes, regulations,
rules, rulings, ordinances, standards and/or directives of all
federal, state, county, municipal and/or local government departments
and/or agencies ("Laws") applicable to it which may have any bearing
on its ability to perform the Work and general obligations under this
Agreement, and Petro shall continue to comply with all Laws now or
hereafter having jurisdiction over the Work and/or those performing
same.


(g) Ability To Perform: No administrative proceeding, investigation,
action, arbitration, claim or litigation is pending before any agency
or in any forum, or, to the best of Petro's knowledge threatened,
against Petro which may adversely affect Petro's ability to perform
the Work and general obligations under this Agreement. Petro further
represents, warrants and covenants that:


(i) it has the required skills and capacity to perform and shall
perform the Work in accordance with the standard of a Reasonable
and Prudent Service Provider and the terms of this Agreement;
and


(ii) it shall execute the Work acting at all times to the standard of
a Reasonable and Prudent Service Provider, using qualified and
competent personnel having the requisite fuel procurement,
accounting, administrative and any other relevant and
appropriate experience necessary to perform and complete the
Work in accordance with the terms of this Agreement; and


(iii) it is knowledgeable of all legal requirements and business
practices that are required to be followed in performing the
Work in accordance with the terms of this Agreement.


(iv) For the purposes of this Agreement, "Reasonable and Prudent
Service Provider" shall mean a person seeking in good faith to
perform its contractual obligations and in so doing and in the
general conduct of its undertaking exercising that degree of
skill, diligence, prudence and foresight that would reasonably
and ordinarily be expected from a skilled and experienced person
engaged in the same type of undertaking under the same or
similar circumstances and any reference to the standard of a
Reasonable and Prudent Service Provider shall be a reference to
such a degree of skill, diligence, prudence and foresight.


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(h) Further Assurances: Petro shall execute and deliver all such other
instruments and take all such other actions as may reasonably be
required from time to time in order to effectuate the terms and
conditions set forth in this Agreement.


4.2 MDS represents, warrants and covenants that:


(a) Good Standing: MDS is a corporation, validly existing and in good
standing under the laws of the State of Delaware.


(b) Organization: MDS has the corporate power and authority to enter into
this agreement, to perform its obligat ...