TESORO CORP /NEW/ (Form: 8-K, Received: 11/21/2016 17:19:44)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 16, 2016

Tesoro Corporation

(Exact name of registrant as specified in its charter)



Delaware	1-3473	95-0862768

(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)



19100 Ridgewood Pkwy San Antonio, Texas		78259-1828

(Address of principal executive offices)		(Zip Code)

(210) 626-6000

(Registrant's telephone number,

including area code)

Not Applicable

(Former name or former address, if

changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.):




o		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

Contribution, Conveyance and Assumption Agreement

On November 21, 2016, Tesoro Corporation (" Tesoro " or the " Company ") entered into a Contribution, Conveyance and Assumption Agreement (the " Contribution Agreement" ) with Tesoro Logistics LP (the " Partnership " or " TLLP "), Tesoro Refining & Marketing Company LLC (" TRMC "), Tesoro Logistics GP, LLC (the " General Partner " or " TLGP ") and Tesoro Logistics Operations LLC (the " Operating Company " or " TLO "). Pursuant to the Contribution Agreement, TRMC agreed to contribute, through the General Partner and the Partnership, to the Operating Company the assets described below:


•	tankage with a shell capacity of approximately 2,600,000 barrels of crude oil and other feedstock storage and approximately 2,900,000 barrels of refined product storage located at TRMC's refinery near Martinez in Contra Costa County, California (the " Martinez Refinery" ), together with all related equipment and ancillary facilities used for the operation thereof (the " Tankage" );

•

the assets (the " Avon Marine Terminal Assets" ) located at the Avon marine terminal facility, a single berth dock that serves as the main shipping and receiving point for the Martinez Refinery for the transfer of waterborne non-crude feedstocks, is the principal outbound marine delivery point for refined products and is directly connected to the refined products tankage located at the Martinez Refinery (the " Avon Marine Terminal" ); and


•	the pipelines, causeway and ancillary equipment that connect Tract 3 of the Tankage to the Avon Marine Terminal, as well as all associated easements, permits and licenses (the " Avon Wharf Pipeway" ).

The assets relating to the Tankage and the Avon Wharf Pipeway were transferred, in a series of contributions, to the Operating Company at the closing of the transactions on November 21, 2016. With respect to the Avon Marine Terminal Assets, the Operating Company entered into the Avon Marine Terminal Operating Agreement (described below), which is intended to be treated as a contribution of the Avon Marine Terminal Assets (including all economic benefits and burdens relating to those assets) as of the closing date. Transfer of the title to the Avon Marine Terminal Assets (the " Avon Marine Terminal Assets Transfer" ) will be completed for no additional consideration after (i) the obtaining of a certificate of financial responsibility from the California Department of Fish and Game with respect to the sublease of the Avon Marine Terminal from TRMC to the Operating Company and (ii) the completion of certain renovation projects at the Avon Marine Terminal. If, however, the Operating Company receives the certificate of financial responsibility before the renovations are complete, the Operating Company may require that TRMC cause the conveyance of the Avon Marine Terminal Assets to the Operating Company and that TRMC sign certain agreements with the Operating Company related thereto.

The transactions contemplated in the Contribution Agreement were made in exchange for consideration from the Partnership to the General Partner of approximately $400 million, comprised of $360 million in cash financed with borrowings under the Partnership's acquisition credit facility, and the issuance of equity securities of the Partnership with a fair value of approximately $40 million. The equity was comprised of 17,570 general partner units to restore and maintain the General Partner's 2% general partner interest in the Partnership and 860,933 common units.

In connection with the Contribution Agreement, the Partnership, the Operating Company, Tesoro, TRMC and the General Partner, as applicable, entered into certain commercial agreements on November 21, 2016, which agreements are described below.

The foregoing description of the Contribution Agreement is not complete and is qualified in its entirety by reference to the Contribution Agreement, which is filed as Exhibit 2.1 to this Current Report on Form 8-K and incorporated herein by reference.

Fourth Amended and Restated Schedules to the Third Amended and Restated Omnibus Agreement

Tesoro entered into the Fourth Amended and Restated Schedules to the Third Amended and Restated Omnibus Agreement (the " Amended Omnibus Schedules" ) with the General Partner, the Partnership, TRMC, Tesoro Alaska Company LLC (" TAC" ) and Tesoro Companies, Inc. (" TCI" ), which amend and restate the schedules to the Third Amended and Restated Omnibus Agreement to include the assets subject to the Contribution Agreement.

The foregoing description is not complete and is qualified in its entirety by reference to the Amended Omnibus Schedules, which are filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.

Storage Services Agreement

Effective November 21, 2016, the Operating Company entered into the Martinez Storage Services Agreement with TRMC, the General Partner and the Partnership (the " Storage Services Agreement" ) to govern the provision of storage services by the Operating Company to TRMC with respect to the Tankage. The initial term of the Storage Services Agreement will be for ten years. TRMC will have the option to extend the term for up to two renewal terms of five years each. Under the Storage Services Agreement, the Operating Company will provide storage, handling, blending and other services for crude oil, refinery feedstocks, refined product and other materials owned by TRMC and stored in one or more of the Operating Company's tanks and certain tanks which are outside of the storage facility, operated by the Operating Company and used to provide services under the Storage Services Agreement, but which remain owned by TRMC. TRMC shall pay the fees specified in an applicable terminal service order to be executed by the Operating Company and TRMC related to the dedication of such tanks and any ancillary services. All fees under the Storage Services that are to be set forth on terminal service orders will be indexed for inflation. For up to two years after the termination of the Storage Services Agreement, and provided the termination was not due to TRMC's default, TRMC may exercise a right of first refusal on any new storage agreement the Operating Company offers to a third party.

The foregoing description is not complete and is qualified in its entirety by reference to the Storage Services Agreement, which is filed as Exhibit 10.2 to this Current Report on Form 8-K and incorporated herein by reference.

License Agreement

TRMC and the Operating Company entered into a license agreement (the " License Agreement" ) pursuant to which TRMC granted the Operating Company the non-exclusive right to use, operate on and access the premises on which a portion of the Martinez Refinery is situated to operate and maintain the Tankage and related pipelines and to provide the storage services under the Storage Services Agreement. The License Agreement may be terminated by TRMC on 30 days' prior written notice to the Operating Company.

The foregoing description is not complete and is qualified in its entirety by reference to the License Agreement, which is filed as Exhibit 10.3 to this Current Report on Form 8-K and incorporated herein by reference.

Avon Marine Terminal Operating Agreement

Effective November 21, 2016, in connection with the contribution of the Tankage and the Avon Wharf Pipeway, the Operating Company entered into an operating agreement (the " Avon Marine Terminal Operating Agreement" ) with TRMC, the General Partner and the Partnership under which the Operating Company will provide services relating to the operation of the Avon Marine Terminal for an interim period until TRMC is able to (i) sublease the property underlying the Avon Marine Terminal Assets to the Operating Company and (ii) convey the Avon Marine Terminal Assets to the Operating Company pursuant to the terms of the Contribution Agreement. Under the Avon Marine Terminal Operating Agreement, the Operating Company agrees that the General Partner will provide personnel, equipment and other services for the operation, management and maintenance of the Avon Marine Terminal and the Operating Company will reimburse TRMC for all amounts paid in rent to the State of California under TRMC's lease of the premises from the State of California and for all repair and maintenance costs and capital expenditures undertaken at the terminal.

As partial compensation for the Operating Company's services, TRMC will pay to the Operating Company a per-barrel fee for throughput of TRMC's products across the Avon Marine Terminal under applicable service orders executed by TRMC and the Operating Company. Additionally, TRMC will reimburse the Operating Company for certain pass-through costs allocable to TRMC's shipments at the Avon Marine Terminal, including for labor services, marine terminal fees, shore-side survey or inspector fees and regulatory costs. The Avon Marine Terminal Operating Agreement also contains reciprocal indemnification provisions.

The foregoing description is not complete and is qualified in its entirety by reference to the Avon Marine Terminal Operating Agreement, which is filed as Exhibit 10.4 to this Current Report on Form 8-K and incorporated herein by reference.

Amendment No. 3 to Secondment and Logistics Services Agreement

On November 21, 2016, the General Partner and certain of its indirect subsidiaries entered into Amendment No. 3 to the Secondment and Logistics Services Agreement (the " Secondment Agreement Amendment" ) with TRMC, TCI, TAC, the Operating Company, Tesoro Logistics Pipelines LLC, Tesoro High Plains Pipeline Company LLC, Tesoro Logistics Northwest Pipeline LLC and Tesoro Alaska Pipeline Company LLC. Under the Secondment Agreement Amendment, the parties agree that either party may provide labor, materials, equipment and supplies to either the "Tesoro" group of companies or the "Tesoro Logistics" group of companies, that such work may be provided by third parties under contract with one of the parties to the Secondment Agreement Amendment and that the costs and expenses will be allocated to the parties that receive the benefits of such work.

The foregoing description of the Secondment Agreement Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Secondment Agreement Amendment, which is filed as Exhibit 10.5 to this Current Report on Form 8-K and incorporated herein by reference.

Sublease

At the time of the Avon Marine Terminal Assets Transfer, TRMC, as sublessor, and TLO, as sublessee, will enter into a sublease (the " Sublease" ) for the Avon Marine Terminal leased by TRMC from the State of California, acting by and through the California State Lands Commission pursuant to a lease dated January 1, 2015 (the " Master Lease" ). The term of the Sublease continues until the expiration of the Master Lease. Under the terms of the Sublease, TLO will: (i) pay all rent due under the Master Lease, (ii) be responsible for paying the required costs of maintenance and improvements to the Avon Marine Terminal under the Master Lease, (iii) be responsible for maintaining all of the insurance required under the Master Lease and (iv) be bound to operate the Avon Marine Terminal in accordance with all legal and regulatory requirements. TLO may, at any time following the termination of the MTUTA (as defined below), deliver TRMC a notice of its intent to cease the conduct of operations from the Avon Marine Terminal, and TRMC shall have the right, but not the obligation, to terminate the Sublease.

The foregoing description is not complete and is qualified in its entirety by reference to the Sublease, which is filed as Exhibit 10.6 to this Current Report on Form 8-K and incorporated herein by reference.

Avon Marine Terminal Use and Throughput Agreement

At the time of the Avon Marine Terminal Assets Transfer, the Operating Company will enter into the Avon Marine Terminal Use and Throughput Agreement (the " MTUTA" ) with TRMC, the General Partner and the Partnership under which TLO will provide throughput service for TRMC's marine vessels and be compensated for such services. Under the MTUTA, TRMC will be obligated to transport an average of at least 892,500 barrels of product per month at a throughput and tankage fee of the higher of $0.63 per barrel or a monthly fee calculated by multiplying the minimum marine throughput volume by $0.63. Additionally, TRMC will reimburse the Operating Company for certain pass-through costs allocable to TRMC's shipments at the Avon Marine Terminal, including for labor services, marine terminal fees, shore-side survey or inspector fees and regulatory costs. The MTUTA also contains reciprocal indemnification provisions. The initial term of the MTUTA expires on the ten-year anniversary date of the effectiveness of the MTUTA, however, TRMC may extend the term for up to two renewal terms of five years each.

The foregoing description is not complete and is qualified in its entirety by reference to the MTUTA, which is filed as Exhibit 10.7 to this Current Report on Form 8-K and incorporated herein by reference.

Relationships

Each of the Partnership, the General Partner, TRMC, TCI, Tesoro SoCal Pipeline Company, LLC, TAC and the Operating Company is a direct or indirect subsidiary of Tesoro. As a result, certain individuals, including officers and directors of Tesoro and the General Partner, serve as officers and/or directors of more than one of such other entities. After the contribution, the General Partner, as the general partner of the Partnership, holds 2,100,900 general partner units of the Partnership, which represents a 2% general partner interest, and 9,644,050 common units of the Partnership, which represents an 9.2% limited partner interest in the Partnership. Tesoro, together with TRMC, Carson Cogeneration Company, TAC and the General Partner, holds 34,055,042 common units of the Partnership, which represent an approximate 32.4% limited partner interest, in addition to the 2% general partner interest in the Partnership discussed above.

Item 2.01. Completion of Acquisition or Disposition of Assets.

The description in Item 1.01 above of the closing of the contribution of the Tankage and the Avon Wharf Pipeway by TRMC, through the General Partner and the Partnership, to the Operating Company is incorporated into this Item 2.01 by reference.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On November 16, 2016, the Board of Directors of the Company appointed Blane W. Peery, age 49, as Vice President and Controller effective immediately. Mr. Peery will assume the role of principal accounting officer, which was temporarily held by Steven M. Sterin, the Company’s Executive Vice President and Chief Financial Officer. Mr. Peery is concurrently being appointed as Vice President and Controller of TLGP, the general partner of the Partnership of which the Company directly and indirectly owns approximately 34%.

Mr. Peery has served as Vice President, Process Excellence and Chief Information Officer of TCI since February 2015. Mr. Peery has experience leading global accounting organizations, business planning and analysis functions, supply chain groups, global shared services including finance, human resources, information technology, and mergers and acquisitions integration. From March 2014 to February 2015, Mr. Peery served as VP, Global Business Services at Mylan N.V., a leading global pharmaceutical company. Prior to that he worked for Celanese Corporation, a global technology and specialty materials company, for over 20 years in roles with increasing responsibility, including positions as its Vice President, Global Business Services from October 2012 to March 2014, its Vice President, Supply Chain from October 2011 to October 2012 and its first-ever Global Accounting Director. Mr. Peery began his career as an auditor for PricewaterhouseCoopers and is a Certified Public Accountant (CPA), Certified Management Accountant (CMA) and Certified in Financial Management (CFM).

In connection with his new position, Mr. Peery will receive an initial base salary of $366,275 and will be eligible to participate in the Company’s annual incentive compensation program (the “ Program ”) with a target bonus opportunity equal to 55% of his base salary. His actual bonus will be based on actual performance relative to corporate and business unit goals established under the Program.

Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

On November 21, 2016, in connection with the execution of the Contribution Agreement and the Whiting Purchase Agreements (as defined below) (collectively, the " Transaction Agreements" ), the General Partner executed the Amendment No. 2 to the First Amended and Restated Agreement of Limited Partnership of the Partnership (the " LP Agreement Amendment" ), which reduces the quarterly distributions made to the holder(s) of the Partnership's incentive distribution rights with respect to each of the eight consecutive quarters beginning with the First Applicable Quarter (as defined below) by $12,500,000; provided, however, that for any such quarter, such $12,500,000 shall not be distributed at that time. The First Applicable Quarter means (1) if the closings of all of the transactions contemplated by the Transaction Agreements have occurred on or prior to December 31, 2016, then the quarter beginning on January 1, 2017 and ending on March 31, 2017, and (2) if the closings of all of the transactions contemplated by the Transaction Agreements occur after December 31, 2016, then the quarter in which the last of such closings occurs. If any of the Transaction Agreements is terminated, then the LP Agreement Amendment shall automatically terminate. Additionally, the LP Agreement Amendment shall automatically terminate if all of the transactions contemplated by the Transaction Agreements have not closed by July 1, 2017.

The foregoing description of the LP Agreement Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the LP Agreement Amendment, which is filed as Exhibit 3.1 to this Current Report on Form 8-K and incorporated herein by reference.

Item 7.01 Regulation FD Disclosure.

On November 21, 2016, Tesoro issued a press release announcing the execution of the Contribution Agreement, the Whiting Purchase Agreements (as defined below) and the LP Agreement Amendment. A copy of the press release is filed as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.

The information in this Item is being furnished, not filed, pursuant to Item 7.01 of Form 8-K. Accordingly, the information in Item 7.01 of this Current Report, including Exhibit 99.1, will not be subject to liability under Section 18 of the Securities Exchange Act of 1934, as amended (the " Exchange Act" ), and will not be incorporated by reference into any registration statement or other document filed by the Partnership under the Securities Act of 1933, as amended, or the Exchange Act, unless specifically identified therein as being incorporated by reference.

Item 8.01 Other Events.

On November 21, 2016, QEP Field Services, LLC ("QEPFS " ), a subsidiary of the Partnership, entered into (1) a purchase and sale agreement with Whiting Oil & Gas Corporation (" Whiting" ) and GBK Investments, L.L.C. (" GBK" ) for the purchase of certain gas processing and gathering facilities located in Mountrail County, North Dakota and owned by Whiting and GBK (the " Robinson Lake Purchase Agreement" ), (2) a purchase and sale agreement with Whiting and WBI Energy Midstream, LLC (" WBI" ), a subsidiary of MDU Resources Group, Inc., for the purchase of certain natural gas processing and oil and gas gathering facilities located in Billings, Dunn and Stark Counties, North Dakota and owned by Whiting and WBI (the " Belfield Purchase Agreement" ), and (3) a purchase and sale agreement with Whiting for the purchase of certain water gathering facilities located in Billings, Dunn and Stark Counties, North Dakota and owned by Whiting (the " Belfield Water Purchase Agreement" and together with the Robinson Lake Purchase Agreement and the Belfield Purchase Agreement, the " Whiting Purchase Agreements "). The Partnership also entered into a guaranty agreement with QEPFS for each Whiting Purchase Agreement in order to guaranty the payment obligations of QEPFS thereunder.

The purchase price for the assets purchased under the Robinson Lake Purchase Agreement is $450 million, the purchase price for the assets purchased under the Belfield Purchase Agreement is $200 million, and the purchase price for the assets purchased under the Belfield Water Purchase Agreement is $50 million. The aggregate purchase price payable under the Whiting Purchase Agreements is $700 million. The purchase price for each transaction is subject to typical adjustments under the applicable Whiting Purchase Agreement, including adjustments for inventory values and for the appropriate allocation of property costs and revenues. QEPFS paid a deposit under each purchase agreement, equal to $22.5 million under the Robinson Lake Purchase Agreement, $8 million under the Belfield Purchase Agreement, and $2 million under the Belfield Water Purchase Agreement, for a total deposit of $32.5 million. Each deposit may be retained by the sellers under the applicable Whiting Purchase Agreements upon certain termination events described thereunder prior to the closing thereof. At closing, each deposit will be applied to the aggregate purchase pricethat is paid under the applicable Whiting Purchase Agreements.

The transactions contemplated under the Whiting Purchase Agreements are expected to close in the first quarter of 2017. The closings of the transactions are subject to customary closing conditions set forth in the Whiting Purchase Agreements, including regulatory approvals. The Whiting Purchase Agreements also contain representations and warranties of the parties, indemnification obligations, termination rights, and a variety of covenants and agreements.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.



	2.1		Contribution, Conveyance and Assumption Agreement, dated as of November 21, 2016, by and among Tesoro Logistics LP, Tesoro Logistics GP, LLC, Tesoro Logistics Operations LLC, Tesoro Corporation and Tesoro Refining & Marketing Company LLC.

	3.1		Amendment No. 2 to First Amended and Restated Agreement of Limited Partnership of Tesoro Logistics LP, dated as of November 21, 2016, entered into and effectuated by Tesoro Logistics GP, LLC.

	10.1		Fourth Amended and Restated Schedules to the Third Amended and Restated Omnibus Agreement, dated as of November 21, 2016, by and among Tesoro Corporation, Tesoro Refining & Marketing Company LLC, Tesoro Companies, Inc., Tesoro Alaska Company LLC, Tesoro Logistics LP and Tesoro Logistics GP, LLC.

	10.2		Martinez Storage Services Agreement, dated as of November 21, 2016, by and among Tesoro Refining & Marketing Company LLC, Tesoro Logistics Operations LLC, Tesoro Logistics GP, LLC and Tesoro Logistics LP.

	10.3		License Agreement, dated as of November 21, 2016, by and among Tesoro Refining & Marketing Company LLC and Tesoro Logistics Operations LLC.

	10.4		Avon Marine Terminal Operating Agreement, dated as of November 21, 2016, by and among Tesoro Logistics Operations LLC, Tesoro Logistics GP, LLC, Tesoro Logistics LP and Tesoro Refining & Marketing Company LLC.

	10.5		Amendment No. 3 to Secondment and Logistics Services Agreement, dated as of November 21, 2016, among Tesoro Companies Inc., Tesoro Refining & Marketing Company LLC, Tesoro Alaska Company LLC, Tesoro Logistics GP, LLC, Tesoro Logistics Operations LLC, Tesoro Logistics Pipelines LLC, Tesoro High Plains Pipeline Company LLC, Tesoro Logistics Northwest Pipeline LLC, and Tesoro Alaska Pipeline Company LLC.

	10.6		Sublease, dated as of November 21, 2016, by and among Tesoro Refining & Marketing Company LLC and Tesoro Logistics Operations LLC.

	10.7		Avon Marine Terminal Use and Throughput Agreement, dated as of November 21, 2016, by and among Tesoro Logistics Operations LLC, Tesoro Logistics GP, LLC, Tesoro Logistics LP and Tesoro Refining & Marketing Company LLC.

	99.1		Press Release of Tesoro issued on November 21, 2016.

SIGNATURES

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

Date: November 21, 2016




	TESORO CORPORATION
	By:	/s/ STEVEN M. STERIN
		Steven M. Sterin
		Executive Vice President and Chief Financial Officer

Index to Exhibits



Exhibit Number		Description

2.1		Contribution, Conveyance and Assumption Agreement, dated as of November 21, 2016, by and among Tesoro Logistics LP, Tesoro Logistics GP, LLC, Tesoro Logistics Operations LLC, Tesoro Corporation and Tesoro Refining & Marketing Company LLC.

3.1		Amendment No. 2 to First Amended and Restated Agreement of Limited Partnership of Tesoro Logistics LP, dated as of November 21, 2016, entered into and effectuated by Tesoro Logistics GP, LLC.

10.1		Fourth Amended and Restated Schedules to the Third Amended and Restated Omnibus Agreement, dated as of November 21, 2016, by and among Tesoro Corporation, Tesoro Refining & Marketing Company LLC, Tesoro Companies, Inc., Tesoro Alaska Company LLC, Tesoro Logistics LP and Tesoro Logistics GP, LLC.

10.2		Martinez Storage Services Agreement, dated as of November 21, 2016, by and among Tesoro Refining & Marketing Company LLC, Tesoro Logistics Operations LLC, Tesoro Logistics GP, LLC and Tesoro Logistics LP.

10.3		License Agreement, dated as of November 21, 2016, by and among Tesoro Refining & Marketing Company LLC and Tesoro Logistics Operations LLC.

10.4		Avon Marine Terminal Operating Agreement, dated as of November 21, 2016, by and among Tesoro Logistics Operations LLC, Tesoro Logistics GP, LLC, Tesoro Logistics LP and Tesoro Refining & Marketing Company LLC.

10.5		Amendment No. 3 to Secondment and Logistics Services Agreement, dated as of November 21, 2016, among Tesoro Companies Inc., Tesoro Refining & Marketing Company LLC, Tesoro Alaska Company LLC, Tesoro Logistics GP, LLC, Tesoro Logistics Operations LLC, Tesoro Logistics Pipelines LLC, Tesoro High Plains Pipeline Company LLC, Tesoro Logistics Northwest Pipeline LLC, and Tesoro Alaska Pipeline Company LLC.

10.6		Sublease, dated as of November 21, 2016, by and among Tesoro Refining & Marketing Company LLC and Tesoro Logistics Operations LLC.

10.7		Avon Marine Terminal Use and Throughput Agreement, dated as of November 21, 2016, by and among Tesoro Logistics Operations LLC, Tesoro Logistics GP, LLC, Tesoro Logistics LP and Tesoro Refining & Marketing Company LLC.

99.1		Press Release of Tesoro issued on November 21, 2016.

Exhibit 2.1

CONTRIBUTION, CONVEYANCE AND ASSUMPTION

AGREEMENT

This Contribution, Conveyance and Assumption Agreement (this “ Agreement ”), effective as of November 21, 2016 (the “ Effective Date ”), is by and among Tesoro Logistics LP, a Delaware limited partnership (the “ Partnership ”), Tesoro Logistics GP, LLC, a Delaware limited liability company and the general partner of the Partnership (the “ General Partner ”), Tesoro Logistics Operations LLC, a Delaware limited liability company (the “ Operating Company ”), Tesoro Corporation, a Delaware corporation (“ Tesoro ”), and Tesoro Refining & Marketing Company LLC, a Delaware limited liability company (“ TRMC ”). The above-named entities are sometimes referred to in this Agreement individually as a “ Party ” and collectively as the “ Parties .”

RECITALS

WHEREAS , TRMC is the owner of approximately 2.6 million barrels of crude oil and other feedstock storage tankage and approximately 3.0 million barrels of refined product storage tankage located at TRMC’s refinery near Martinez in Contra Costa County, California (the “ Martinez Refinery ”), together with all related equipment and ancillary facilities used for the operation thereof, and all permits and licenses related to such tankage, to the extent assignable and to the extent used in connection with the ownership and operation of the assets described above, which assets are listed in detail on Exhibit A-1 hereto (the “ Tankage ”), which is connected to the Avon Marine Terminal (as defined below) through the Avon Wharf Pipeway (as defined below);

WHEREAS , TRMC is also the owner of all of its leasehold interest in the Avon Marine Terminal Facility, a single berth dock that (i) serves as the main shipping and receiving point for the Martinez Refinery for the transfer of waterborne non-crude feedstocks, (ii) is the principal outbound marine delivery point for refined products, and (iii) is directly connected to the Martinez Refinery’s refined products tankage (the “ Avon Marine Terminal ”); and

WHEREAS , TRMC desires to contribute the Assets (as defined below) to the General Partner, which the General Partner desires to contribute to the Partnership and the Partnership desires to contribute to the Operating Company, and concurrently with the contribution of the Assets, TRMC and the Operating Company desire to enter into the Contracts (as defined below), all on the terms and conditions set forth herein.

NOW, THEREFORE , in consideration of the mutual covenants, representations, warranties and agreements herein contained, the Parties hereto agree as follows:

ARTICLE I
DEFINITIONS

Section 1.1 Capitalized terms used herein have the respective meanings ascribed to such terms below:

“ Affiliates ” has the meaning set forth in the Partnership Agreement.

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“ Agreement ” has the meaning set forth in the introduction to this Agreement.

“ Assets ” means (i) the Tankage and (ii) the Avon Wharf Pipeway.

“ Avon Marine Terminal ” has the meaning set forth in the Recitals.

“ Avon Marine Terminal Assets ” means certain assets located at the Avon Marine Terminal, as further described in Exhibit A-2 .

“ Avon Marine Terminal Operating Agreement ” means that certain Avon Marine Terminal Operating Agreement to be effective at the Effective Time by and between TRMC and the Operating Company pursuant to which the Operating Company will manage and operate the Avon Marine Terminal for TRMC on the terms and conditions included therein.

“ Avon Marine Terminal Renovation ” means each of the Avon Wharf Upgrade (MOTEMS) (AFE No. 077100030) and Pipeline Surge Protection Project (AFE No. 154100001) being undertaken by TRMC at the Avon Marine Terminal as of the Effective Date.

“ Avon Marine Terminal Sublease Agreement ” means that certain Sublease to be executed in accordance with Section 2.5 by and between the Operating Company and TRMC relating to the Avon Marine Terminal.

“ Avon Marine Terminal Use and Throughput Agreement ” or the “ Avon MTUTA ” means that certain Avon Marine Terminal Use and Throughput Agreement to be executed pursuant to Section 2.5 by and among the Operating Company, the General Partner, the Partnership and TRMC, pursuant to which the Operating Company will, effective as of the “Commencement Date” (as defined therein), manage and operate the Avon Marine Terminal.

“ Avon Wharf Pipeway ” means the three pipelines, a causeway and all ancillary equipment that connect Tract 3 (of the Tankage) to the Avon Marine Terminal, all as further described in Exhibit A-3 , as well as all associated easements, permits and licenses relating to the Avon Wharf Pipeway.

“ Bill of Sale ” means that certain Bill of Sale, Assignment and Assumption effective as of the Effective Time, among TRMC, the General Partner, the Partnership and the Operating Company, with respect to the Assets.

“ Cash Consideration ” has the meaning set forth in Section 2.3(b)(i) .

“ CDFG ” means the California Department of Fish and Game.

“ Code ” means the Internal Revenue Code of 1986, as amended.

“ COFR ” means the Certificate of Financial Responsibility issued by the CDFG in favor of the Operating Company with respect to oil spill contingency planning and financial responsibility with respect to operations in the State of California, including under the Avon Marine Terminal Sublease Agreement and Avon MTUTA.

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“ Common Unit ” means a common unit representing a limited partner interest in the Partnership having the rights set forth in the Partnership Agreement.

“ Conflicts Committee ” has the meaning set forth in the Partnership Agreement.

“ Contracts ” means (i) the License Agreement, (ii) the Martinez Storage Services Agreement and (iii) the Avon Marine Terminal Operating Agreement.

“ Credit Facility ” means that certain Senior Secured Revolving Credit Agreement dated as of January 29, 2016, by and among the Partnership, as borrower, Bank of America, N.A., as administrative agent, and the other parties thereto.

“ Debt-Financed Cash Consideration ” has the meaning set forth in Section 2.3(c) .

“ Effective Date ” has the meaning set forth in the introduction to this Agreement.

“ Effective Time ” means 12:01 a.m. Central Time on the Effective Date.

“ Equity Consideration ” has the meaning set forth in Section 2.3(b)(ii) .

“ Excluded Assets and Liabilities ” means those certain assets and properties (including any and all petroleum and hydrocarbon inventory) and certain responsibilities, coverages and liabilities that might otherwise be considered as part of the Assets or the Contracts but are being retained by TRMC and are not being contributed, transferred or assumed to or by the General Partner, the Partnership or the Operating Company as part of the transactions contemplated by this Agreement, as set forth on Exhibit C to this Agreement.

“ General Partner ” has the meaning set forth in the introduction to this Agreement.

“ General Partner Contribution ” has the meaning set forth in Section 2.3(a) .

“ General Partner Unit ” means a general partner unit representing a general partner interest in the Partnership having the rights set forth in the Partnership Agreement.

“ Intended Tax Treatment ” has the meaning set forth in Section 4.2(a) .

“ License Agreement ” means the License Agreement with respect to the Tankage and the Avon Wharf Pipeway between TRMC and the Operating Company.

“ Martinez Refinery ” has the meaning set forth in the Recitals.

“ Martinez Storage Services Agreement ” means the Martinez Storage Services Agreement with respect to the Tankage among TRMC, the Operating Company, the General Partner and the Partnership.

“ Master Lease ” means that General Lease – Industrial Use, dated January 1, 2015, between TRMC and the State of California, acting by and through the California State Lands Commission,

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covering the property in Contra Costa County, California described in Exhibit A to the Master Lease, as such lease (and the Exhibits thereto) exists as of the Effective Date.

“ Material Adverse Effect ” has the meaning set forth in Section 3.5(a) .

“ Omnibus Agreement ” means that certain Third Amended and Restated Omnibus Agreement dated as of July 1, 2014, among Tesoro, TRMC, Tesoro Companies, Inc., Tesoro Alaska Company LLC, the General Partner and the Partnership, as such agreement (and the Schedules thereto) may be amended, supplemented or restated from time to time.

“ Operating Company ” has the meaning set forth in the introduction to this Agreement.

“ Partnership ” has the meaning set forth in the introduction to this Agreement.

“ Partnership Agreement ” means the First Amended and Restated Agreement of Limited Partnership of the Partnership, dated as of April 26, 2011, as such agreement may be amended, supplemented or restated from time to time.

“ Partnership Contribution ” has the meaning set forth in Section 2.3 .

“ Partnership Group ” has the meaning set forth in the Omnibus Agreement.

“ Party ” or “ Parties ” have the meanings given to those terms in the introduction to this Agreement.

“ Permitted Liens ” has the meaning set forth in Section 2.1(a) .

“ Purchase Price ” means $400,000.

“ Real Property Assets ” means the real property assets underlying the Tankage.

“ Rescission Event ” has the meaning set forth in Section 5.1 .

“ Secondment and Logistics Services Agreement ” means that certain Secondment and Logistics Services Agreement dated as of July 1, 2014, as may be amended, modified or supplemented from time to time, among Tesoro, TRMC, the General Partner, the Partnership, Tesoro Logistics Pipeline LLC, Tesoro High Plains Pipeline Company LLC, Tesoro Alaska Company LLC, QEP Field Services, LLC, QEP Midstream Partners Operating, LLC, QEP Midstream Partners GP, LLC and QEPM Gathering I, LLC.

“ Tankage ” has the meaning set forth in the Recitals.

“ Tesoro ” has the meaning set forth in the introduction to this Agreement.

“ Transaction Documents ” has the meaning set forth in Section 3.4(a) .

“ Treasury Regulations ” means the regulations (including temporary regulations) promulgated by the United States Department of the Treasury pursuant to and in respect of provisions

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of the Code. All references herein to sections of the Treasury Regulations shall include any corresponding provision or provisions of succeeding, similar or substitute, temporary or final Treasury Regulations.

“ TRMC ” has the meaning set forth in the introduction to this Agreement.

“ TRMC Contribution ” has the meaning set forth in Section 2.1(a) .

ARTICLE II

CONTRIBUTIONS AND ACKNOWLEDGEMENTS

Section 2.1 Conveyance by TRMC to the General Partner .

(a) Effective as of immediately prior to the Effective Time, TRMC hereby assigns, transfers, contributes, grants, bargains, conveys, sets over and delivers to the General Partner, its successors and its assigns, for its and their own use forever, the entire right, title, interest, responsibilities, coverages and liabilities of TRMC in and to the Assets, including any responsibilities, coverages and liabilities under any permit or license included in the Assets, free and clear of all liens and encumbrances of any kind or nature, other than as set forth on Exhibit B to this Agreement (the “ Permitted Liens ”). In addition, concurrently with the contribution of the Assets, TRMC is also executing and delivering the Contracts. The contribution of the Assets and execution and delivery of the Contracts described in this Section 2.1(a) shall be referred to in this Agreement as the “ TRMC Contribution .”

(b) TRMC makes the TRMC Contribution in exchange for the issuance as of the Effective Date of an additional membership interest in the General Partner equal to the percentage increase in the capital of the General Partner based on the value of the TRMC Contribution as a contribution to the capital of the General Partner.

(d) The Parties hereby acknowledge that the Excluded Assets and Liabilities are being retained by TRMC and are not being contributed or transferred as part of the TRMC Contribution.

Section 2.2 Conveyance by the General Partner to the Partnership .

(a) Effective as of the Effective Time, the General Partner hereby assigns, transfers, contributes, grants, bargains, conveys, sets over and delivers to the Partnership, its successors and its assigns, for its and their own use forever, the entire right, title, interest, responsibilities, coverages and liabilities of the General Partner in and to the Assets, including any responsibilities, coverages and liabilities under any permit or license included in the Assets, free and clear of all liens and encumbrances of any kind or nature, other than the Permitted Liens. In addition, concurrently with the contribution of the Assets, TRMC is also executing and delivering

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the Contracts. The contribution of the Assets and execution and delivery of the Contracts described in this Section 2.2(a) shall be referred to in this Agreement as the “ General Partner Contribution .”

(b) The General Partner shall make the General Partner Contribution in exchange for the distribution or issuance by the Partnership of the following as of the Effective Time in consideration of the conveyance and transfer of the Assets:

(i) a distribution of cash equal to ninety percent (90%) of the value of the Purchase Price (the “ Cash Consideration ”); and

(ii) the issuance to the General Partner of such number of General Partner Units and Common Units with an aggregate value equal to ten percent (10%) of the Purchase Price (the “ Equity Consideration ”):

(1) which number of General Partner Units, rounded up to the next highest number of whole units, shall be the amount having an aggregate dollar value of the Equity Consideration necessary to restore and maintain the General Partner’s two percent (2%) general partner interest in the Partnership; and

(2) which number of Common Units, rounded down to the next lowest number of whole units, shall be the amount equal to (A) the remainder of (I) the amount of the Equity Consideration, less (II) an amount equal to the value of the General Partner Units issued pursuant to Section 2.2(b)(ii)(1) , divided by (B) the average closing price of the Common Units for the last ten (10) trading days prior to the Effective Date.

(c) To effect the distribution of the Cash Consideration, the Partnership shall borrow an amount equal to the Cash Consideration (the “ Debt‑Financed Cash Consideration ”) under indebtedness for which no partner of the Partnership or any related person other than Tesoro bears the economic risk of loss (as defined by Treasury Regulations Section 1.752-2) and the Partnership shall cause the proceeds of such indebtedness to be wire transferred to the General Partner on behalf of the Partnership directly from the applicable lender to an account designated by the General Partner.

(d) After the distribution of the Cash Consideration to the General Partner by the Partnership, the General Partner shall provide a loan of up to that amount to Tesoro and Tesoro shall execute and deliver a ten-year promissory note in favor of the General Partner to evidence the funds loaned by the General Partner to Tesoro.

(e) The Partnership hereby accepts the General Partner Contribution as a contribution to the capital of the Partnership.

Section 2.3 Conveyance by the Partnership to the Operating Company . Effective immediately after the General Partner Contribution, the Partnership hereby assigns, transfers, contributes, grants, bargains, conveys, sets over and delivers to the Operating Company, its

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successors and its assigns, for its and their own use forever, the entire right, title, interest, responsibilities, coverages and liabilities of the Partnership in and to the Assets, including any responsibilities, coverages and liabilities under any permit or license included in the Assets, free and clear of all liens and encumbrances of any kind or nature, other than the Permitted Liens. In addition, concurrently with the contribution of the Assets, TRMC is also executing and delivering the Contracts. The contribution of the Assets and execution and delivery of the Contracts described in this Section 2.3 shall be referred to in this Agreement as the “ Partnership Contribution .” The Partnership hereby makes the Partnership Contribution as a capital contribution to the capital of the Operating Company and the Operating Company hereby accepts the Partnership Contribution as a contribution to the capital of the Operating Company.

Section 2.4 Actions and Deliveries on the Effective Date . The Parties acknowledge that the following actions and deliveries have occurred:

(a) receipt by the Parties of all permits, consents, approvals, authorizations, orders, registrations, filings or qualifications of or with any court, governmental agency or body having jurisdiction over the Parties required in connection with the execution, delivery and performance of the Transaction Documents;

(b) the execution and delivery by the respective parties thereto of the following documents:

(i) the Bill of Sale, substantially in the form attached hereto as Exhibit D , pursuant to which TRMC, the General Partner and the Partnership assign and convey the Assets;

(ii) the Martinez Storage Services Agreement, substantially in the form attached hereto as Exhibit E, and the service order related thereto;

(iii) the License Agreement, substantially in the form attached hereto as Exhibit F , pursuant to which TRMC grants the Operating Company a license to operate and maintain the Assets;

(iv) the Avon Marine Terminal Operating Agreement, substantially in the form attached hereto as Exhibit G ;

(v) Amendment to the Secondment and Logistics Services Agreement, substantially in the form attached hereto as Exhibit H-1, and the service orders related thereto, substantially in the form attached hereto as Exhibit H-2 ;

(vi) Fourth Amended and Restated Schedules to the Omnibus Agreement among Tesoro, TRMC, Tesoro Companies, Inc., Tesoro Alaska Company LLC, the General Partner and the Partnership, substantially in the form attached hereto as Exhibit I ;

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(vii) Amendment No. 5 to the Second Amended and Restated Limited Liability Company Agreement of the General Partner among the General Partner, Tesoro, TRMC and Tesoro Alaska Company LLC, substantially in the form attached hereto as Exhibit J ;

(viii) a ten-year promissory note, substantially in the form attached hereto as Exhibit K , by Tesoro in favor of the General Partner to evidence the funds loaned by the General Partner to Tesoro pursuant to Section 2.2(d) ;

(ix) a debt indemnification agreement, substantially in the form attached hereto as Exhibit L ;

(x) a closing escrow agreement, substantially in the form attached hereto as Exhibit M , to effect the closing into escrow with McGuireWoods LLP of all the Transaction Documents related to the contribution of the Assets; and

(xi) all other documents and instruments necessary or appropriate to convey the Assets to the Operating Company.

(c) the Conflicts Committee of the General Partner has received a fairness opinion by Evercore Group, L.L.C., the financial advisor to the Conflicts Committee.

Section 2.5 Commencement of Avon Marine Terminal Sublease Agreement and Avon MTUTA; Conveyance of Avon Marine Terminal Assets; Related Actions and Deliveries .

(a) TRMC agrees to use its reasonable commercial efforts (i) to complete the Avon Marine Terminal Renovations in accordance with Schedule VI to the Omnibus Agreement and (ii) to assist the Operating Company in obtaining the COFR from the CDFG as required under the Avon Marine Terminal Sublease Agreement and the Avon MTUTA as well as any other written consents necessary for the Operating Company and TRMC to enter into the Avon Marine Terminal Sublease Agreement and the Avon MTUTA and for TRMC to convey the Avon Marine Terminal Assets to the Operating Company. TRMC shall cooperate with the Operating Company in such manner as may be reasonably requested in connection therewith, including without limitation, active participation in visits to and meetings, discussions and negotiations with all persons or entities with the authority to grant or withhold consent.

(b) During the period before the Avon Marine Terminal Sublease Agreement and the Avon MTUTA become effective, the Operating Company shall provide operating services with respect to the Avon Marine Terminal pursuant to the Avon Marine Terminal Operating Agreement and in such instance, TRMC and the Operating Company will use their reasonable commercial efforts to take such actions to effectively grant the Operating Company the economic benefits of, and impose upon the Operating Company the economic burdens of, the Avon Marine Terminal, subject to and in accordance with, the Avon Marine Terminal Operating Agreement.

(c) In the event that the COFR has been obtained prior to the completion of the Avon Marine Terminal Renovations, the Operating Company shall have the right, but not the

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obligation, to require upon five (5) days’ written notice that TRMC execute and deliver the Avon Marine Terminal Sublease Agreement, substantially in the form attached hereto as Exhibit N , and the Avon MTUTA, substantially in the form attached hereto as Exhibit O , and to cause the conveyance of the Avon Marine Terminal Assets pursuant to Section 2.5(f) and the terms of the Avon Marine Terminal Sublease Agreement.

(d) If the Operating Company has not exercised its rights under Section 2.5(c) above, then within ten (10) business days or such other time as mutually agreed upon after the completion of the Avon Marine Terminal Renovations and the issuance of the COFR, the Parties will take any and all actions necessary or advisable to execute and deliver the Avon Marine Terminal Sublease Agreement and the Avon MTUTA, and to complete the conveyance and transfer of the Avon Marine Terminal Assets pursuant to Section 2.5(f) hereof and the terms of the Avon Marine Terminal Sublease Agreement.

(e) Prior to the execution and delivery of the Avon Marine Terminal Sublease Agreement and the Avon MTUTA and the conveyance of the Avon Marine Terminal Assets pursuant to the terms of the Avon Marine Terminal Sublease Agreement, TRMC shall to the extent not otherwise provided in the Avon Marine Terminal Operating Agreement:

(i) file on a timely basis all notices, reports or other filings necessary or required for the continuing operation of the Avon Marine Terminal to be filed with or reported to any governmental authority;

(ii) file on a timely basis all complete and correct applications or other documents necessary to maintain, renew or extend any permit, variance or any other approval required by any governmental authority necessary or required for the continuing operation of the Avon Marine Terminal whether or not such approval would expire before or after the execution and delivery of the Avon Marine Terminal Sublease Agreement;

(iii) not permit any lien or other encumbrance to be imposed on the Avon Marine Terminal Assets, other than Permitted Liens;

(iv) not sell, lease or otherwise dispose of any Avon Marine Terminal Asset; and

(v) not agree to do any of the actions set forth in subsections (iii) and (iv) above.

(f) At the time of the conveyance of the Avon Marine Terminal Assets pursuant to the terms of the Avon Marine Terminal Sublease Agreement:

(i) the Parties shall reaffirm the representations and warranties set forth in ARTICLE III with respect to the Avon Marine Terminal and the Avon Marine Terminal Assets and will confirm receipt by the Parties of all permits, consents, approvals, authorizations, orders, registrations, filings or qualifications of or with

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any court, governmental agency or body having jurisdiction over the Parties required in connection with the conveyance of the Avon Marine Terminal Assets and/or execution, delivery or performance of the Avon Marine Terminal Sublease Agreement or the Avon MTUTA;

(ii) the applicable Parties shall execute and deliver:

(1) the Avon Marine Terminal Sublease Agreement, substantially in the form attached hereto as Exhibit N ; and

(2) the Avon Marine Terminal Use and Throughput Agreement, substantially in the form attached hereto as Exhibit O ; and

(iii) the following contributions, conveyances and transfers will occur in the following order:

(1) TRMC shall assign, transfer, contribute, grant, bargain, convey, set over and deliver to the General Partner, its successor and its assigns, for its and their own use forever, TRMC’s entire right, title, interest, responsibilities, coverages and liabilities in and to the Avon Marine Terminal Assets, including any responsibilities, coverages and liabilities under any permit or license included in the Avon Marine Terminal Assets, free and clear of all liens and encumbrances of any kind or nature, other than the Permitted Liens. This contribution shall be made for no additional consideration and the General Partner shall accept the Avon Marine Terminal Assets from TRMC as a contribution to the capital of the General Partner.

(2) The General Partner shall then assign, transfer, contribute, grant, bargain, convey, set over and deliver to the Partnership, its successor and its assigns, for its and their own use forever, the General Partner’s entire right, title, interest, responsibilities, coverages and liabilities in and to the Avon Marine Terminal Assets, including any responsibilities, coverages and liabilities under any permit or license included in the Avon Marine Terminal Assets, free and clear of all liens and encumbrances of any kind or nature, other than the Permitted Liens. This contribution shall be made for no additional consideration and the Partnership shall accept the Avon Marine Terminal Assets from the General Partner as a contribution to the capital of the Partnership.

(3) The Partnership shall assign, transfer, contribute, grant, bargain, convey, set over and deliver to the Operating Company, its successor and its assigns, for its and their own use forever, the Partnership’s entire right, title, interest, responsibilities, coverages and liabilities in and to the Avon Marine Terminal Assets, including any responsibilities, coverages and liabilities under any permit or license included in the Avon Marine Terminal Assets, free and clear of all liens and encumbrances of any kind or nature,

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other than the Permitted Liens. This contribution shall be made for no additional consideration and the Operating Company shall accept the Avon Marine Terminal Assets from the Partnership as a contribution to the capital of the Operating Company.

(4) TRMC, the General Partner, the Partnership and the Operating Company will execute and deliver such additional documents, instruments and certifications necessary or advisable in connection with the conveyance of the Avon Marine Terminal Assets pursuant to this Section 2.5 and the Avon Marine Terminal Sublease Agreement.

ARTICLE III
REPRESENTATIONS

Section 3.1 Representations of TRMC . TRMC hereby represents and warrants to the General Partner, the Partnership and the Operating Company as follows:

(a) The Tankage, the Avon Wharf Pipeway and the Avon Marine Terminal are each in good working condition, suitable for the purposes for which they are being used in accordance with accepted industry standards and all applicable laws and regulations, subject, in the case of the Avon Marine Terminal, to the completion of the Avon Marine Terminal Renovation.

(b) TRMC has title to each of the Tankage, the Avon Wharf Pipeway and the Avon Marine Terminal Assets free and clear of all liens and encumbrances of any kind or nature, other than the Permitted Liens. TRMC has title to each of the Tankage, the Avon Wharf Pipeway, the Real Property Assets and the Avon Marine Terminal Assets that is sufficient to operate each such Asset in accordance with its intended and historical use, subject to all recorded matters and all physical conditions in existence.

(c) To TRMC’s knowledge, after reasonable investigation, there are no terms in any agreements included in the Assets, the Contracts or the Avon Marine Terminal Assets that would materially impair the rights granted to the General Partner and Partnership Group pursuant to the transactions contemplated by this Agreement.

(d) TRMC has previously delivered a true, correct and complete copy of the Master Lease (and any amendments to the Master Lease) to the General Partner, the Partnership and the Operating Company. The Master Lease is in full force and effect and no defaults exist nor do any conditions exist that may result in any default under the Master Lease.

Section 3.2 Representation of the General Partner . The General Partner hereby represents and warrants to TRMC that the General Partner has full power and authority to act as general partner of the Partnership in all material respects.

Section 3.3 Representation of the Partnership . The Partnership hereby represents and warrants to the General Partner and Tesoro that the Common Units and the General Partner Units of the Partnership issued to the General Partner pursuant to Section 2.2(b) have been duly authorized

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for issuance and sale to the General Partner and, when issued and delivered by the Partnership pursuant to this Agreement against payment of the consideration set forth herein, will be validly issued and fully paid (to the extent required under the Partnership Agreement) and nonassessable (except as such nonassessability may be affected by matters described in Sections 17-607 and 17-804 of the Delaware Limited Partnership Act).

Section 3.4 Representations of the Parties . Each Party represents and warrants, severally as to only itself and not jointly, to the other Parties as follows:

(a) The applicable Party has been duly formed or incorporated and is validly existing as a limited partnership, limited liability company or corporation, as applicable, in good standing under the laws of its jurisdiction of organization with full power and authority to enter into and perform its obligations under this Agreement and the other documents contemplated herein (the “ Transaction Documents ”) to which it is a party, to own or lease and to operate its properties currently owned or leased or to be owned or leased and to conduct its business. The applicable Party is duly qualified to do business as a foreign corporation, limited liability company or limited partnership, as applicable, and is in good standing under the laws of each jurisdiction which requires such qualification, except where the failure to be so qualified or registered would not have a material adverse effect on the condition (financial or otherwise), prospects, earnings, business or properties, taken as a whole, whether or not arising from transactions in the ordinary course of business, of such Party (a “ Material Adverse Effect ”).

(b) The applicable Party has all requisite power and authority to execute and deliver the Transaction Documents to which it is a party and perform its respective obligations thereunder. All corporate, partnership and limited liability company action, as the case may be, required to be taken by the applicable Party or any of its stockholders, members or partners for the execution and delivery by the applicable Party of the Transaction Documents to which it is a party and the consummation of the transactions contemplated thereby has been validly taken.

(c) For the applicable Party, each of the Transaction Documents to which it is a party is a valid and legally binding agreement of such Party, enforceable against such Party in accordance with its terms, except (i) as the enforceability thereof may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws relating to or affecting creditors’ rights generally and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law) and (ii) that the indemnity, contribution and exoneration provisions contained in any of the Transaction Documents may be limited by applicable laws and public policy.

(d) Neither the execution, delivery and performance of the Transaction Documents by the applicable Party that is a party thereto nor the consummation of the transactions contemplated by the Transaction Documents conflict or will conflict with, or result or will result in, a breach or violation of or a default under (or an event that, with notice or lapse of time or both would constitute such an event), or imposition of any lien, charge or encumbrance upon any property or assets of any of the applicable Party pursuant to (i) the partnership agreement, limited liability company agreement, certificate of limited partnership, certificate of formation or conversion, certificate or articles of incorporation, bylaws or other constituent document of the applicable Party,

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(ii) the terms of any indenture, contract, lease, mortgage, deed of trust, note agreement, loan agreement or other agreement, obligation, condition, covenant or instrument to which the applicable Party is a party or bound or to which its property is subject or (iii) any statute, law, rule, regulation, judgment, order or decree applicable to the applicable Party of any court, regulatory body, administrative agency, governmental body, arbitrator or other authority having jurisdiction over such Party or any of its properties in a proceeding to which it or its property is a party, except in the case of clause (ii) , liens, charges or encumbrances arising under security documents for the collateral pledged under such Party’s applicable credit agreements and except in the case of clause (iii) , where such breach or violation would not reasonably be expected to have a Material Adverse Effect.

(e) No permit, consent, approval, authorization, order, registration, filing or qualification of or with any court, governmental agency or body having jurisdiction over the applicable Party or any of its properties or assets is required in connection with the execution, delivery and performance of the Transaction Documents by the applicable Party, the execution, delivery and performance by the applicable Party that is a party thereto of its respective obligations under the Transaction Documents or the consummation of the transactions contemplated by the Transaction Documents other than (i) any filing related to the sale of the Common Units under this Agreement with federal or state securities laws authorities, (ii) consents that have been obtained and (iii) consents where the failure to obtain such consent would not reasonably be expected to have a Material Adverse Effect.

(f) No action, suit, proceeding, inquiry or investigation by or before any court or governmental or other regulatory or administrative agency, authority or body or any arbitrator involving the applicable Party or its property is pending or, to the knowledge of the applicable Party, threatened or contemplated that (i) would individually or in the aggregate reasonably be expected to have a material adverse effect on the performance of the Transaction Documents or the consummation of any of the transactions contemplated therein, or (ii) would individually or in the aggregate reasonably be expected to have a Material Adverse Effect.

ARTICLE IV
COVENANTS

Section 4.1 Further Assurances .

(a) From time to time after the Effective Time, and without any further consideration, the Parties agree to execute, acknowledge and deliver all such additional deeds, assignments, bills of sale, conveyances, instruments, notices, releases, acquittances and other documents, and to do all such other acts and things, all in accordance with applicable law, as may be necessary or appropriate (i) more fully to assure that the applicable Parties own all of the properties, rights, titles, interests, estates, remedies, powers and privileges granted by this Agreement, or which are intended to be so granted, (ii) more fully and effectively to vest in the applicable Parties and their respective successors and assigns beneficial and record title to the interests contributed and assigned by this Agreement or intended to be so contributed and assigned (including any actions required to effect the assignment and conveyance of the Assets, the Contracts

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and the Avon Marine Terminal Assets as contemplated herein), and (iii) more fully and effectively to carry out the purposes and intent of this Agreement.

(b) To the extent any permits related to the Assets or the Contracts may not be assigned or transferred without the consent of a third party that has not been obtained at the Effective Time despite the exercise by TRMC of its reasonable best efforts, this Agreement shall not constitute an agreement to assign or transfer such permit if an attempted assignment or transfer would constitute a breach thereof or be unlawful. In that case, TRMC, to the maximum extent permitted by law, (a) shall act after the Effective Time as the Operating Company’s agent to obtain for the Operating Company the benefits thereunder, and (b) shall cooperate, to the maximum extent permitted by applicable law, with the Operating Company in any other reasonable arrangement designed to provide those benefits to the Operating Company, including by agreeing to remain liable under any applicable permit. Nothing contained in this Section 4.1(b) shall relieve TRMC of its obligations under any other provisions of this Agreement.

Section 4.2 Tax Covenants .

(a) The Parties intend that for U.S. federal income tax purposes (the “ Intended Tax Treatment ”):

(i) the TRMC Contribution shall be disregarded as a result of TRMC and the General Partner each being disregarded as an entity separate from Tesoro for U.S. federal income tax purposes;

(ii) the General Partner Contribution shall be treated as a contribution by Tesoro (as a result of the General Partner being disregarded as an entity separate from Tesoro for U.S. federal income tax purposes) pursuant to Section 721(a) of the Code, subject to Section 707 of the Code, with the distribution of the Debt-Financed Cash Consideration qualifying as a “debt-financed transfer” under Treasury Regulations Section 1.707-5(b);

(iii) any Cash Consideration in excess of the amount properly treated as a “debt-financed transfer” shall be treated (1) as a reimbursement of preformation expenditures within the meaning of Treasury Regulations Sections 1.707-4(d) to the greatest extent applicable, and (2) in a transaction subject to treatment under Section 707(a) of the Code, and its implementing Treasury Regulations, as in part a sale, and in part a contribution, by Tesoro of the Assets; and

(iv) the Avon Marine Terminal Operating Agreement is intended for U.S. federal income tax purposes (and, where applicable, state and local income tax purposes) to be treated as a contribution of the Avon Marine Terminal Assets by Tesoro (as a result of TRMC and General Partner each being disregarded as entities separate from Tesoro) to the Partnership (as a result of Operating Company being disregarded as an entity separate from Partnership) in exchange for the applicable portion of the distribution and issuance described in Section 2.2(b) .

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(b) Except with the prior written consent of the General Partner or as otherwise required by applicable law following a final determination by the U.S. Internal Revenue Service or a governmental authority with competent jurisdiction, the Parties agree to file all tax returns and otherwise act at all times in a manner consistent with the Intended Tax Treatment, including disclosing the distribution of the Debt-Financed Cash Consideration in accordance with the requirements of Treasury Regulations Section 1.707-3(c)(2).

ARTICLE V
RESCISSION OF ASSETS

Section 5.1 Rescission . A “ Rescission Event ” with respect to the Assets means (a) the determination by any court, regulatory body, administrative agency, governmental body, arbitrator or other authority agency or regulatory authority that the TRMC Contribution (i) is void or invalid or (ii) requires a governmental approval with respect to the transfer of the Tankage or the Avon Wharf Pipeway which was not obtained by TRMC prior to such determination, and, in case of either clause (i) or clause (ii), which TRMC fails to cure within twenty-four (24) months following such determination; or (b) the revocation, termination or TRMC’s material breach of the License Agreement.

Section 5.2 Notice of Rescission . Upon the occurrence of a Rescission Event that has not been cured, regardless of the time period set forth in Section 5.1(a) , the Operating Company shall have the right, but not the obligation, to rescind the Partnership Contribution, the General Partner Contribution and the TRMC Contribution by providing written notice to TRMC.

Section 5.3 Effect of Rescission . Upon receipt by TRMC of the Operating Company’s written notice of rescission under Section 5.2:

(a) The General Partner will cause the Partnership to engage in a process to determine the fair market value of the Assets as of the date of the notice of rescission using the process for the determination of fair market value set forth in Section 2.3 of the Omnibus Agreement (with the notice of rescission delivered pursuant to Section 5.2 hereof triggering the time periods relating to such process under Section 2.3 of the Omnibus Agreement). The amount determined under Section 2.3 of the Omnibus Agreement will be the “ Rescission Amount ”.

(b) Within 10 days after the determination of the Rescission Amount, (i) the General Partner will repay a portion of the purchase price with to the respect to the Assets previously paid pursuant to Section 2.2(b) equal to the Rescission Amount and (ii) Tesoro will repay the loan specified in Section 2.2(d) to the General Partner to the extent the consideration is repaid pursuant to Section 5.3(b)(i) .

(c) The Parties shall file any documents or instruments necessary or appropriate with federal, state or local governmental authorities to cancel the transactions contemplated by this Agreement related to the Assets and the Contracts subject to the Rescission Event, including, but not limited to, conveyance documents related to the Assets and the Contracts subject to the Rescission Event to nullify the transactions that occurred on the Effective Date.

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(d) The Parties shall amend or terminate, as applicable, and shall cause all their Affiliates to amend or terminate, as applicable, any agreements, including the License Agreement and the Martinez Storage Services Agreement (or portions of inter-company agreements), that were entered into or amended in connection with the transactions contemplated in this Agreement with respect to the Assets to be as such agreements existed prior to the Effective Date.

(e) Notwithstanding the foregoing in this Section 5.3 , (i) the Common Units and General Partner Units issued pursuant to Section 2.2(b) shall remain outstanding and (ii) any indemnities that existed in any applicable agreement related to the Tankage and the Avon Wharf Pipeway prior to the Effective Time and before the Operating Company’s ownership and operation of such assets for the period between Effective Time and the date of rescission will survive the rescission.

(f) Any revenues earned and expenses incurred by any Party related to the Assets from the Effective Time through the date of rescission shall not be refunded or reimbursed.

(g) Upon the occurrence of a Rescission Event, the Parties agree to amend the Avon Marine Terminal Use and Throughput Agreement, as necessary or appropriate, to reflect the occurrence of such Rescission Event.

ARTICLE VI
MISCELLANEOUS

Section 6.1 Costs . Each Party shall pay its own costs and expenses with respect to the transactions contemplated by this Agreement; except as follows:

(a) the Partnership and TRMC shall each pay one-half of (i) the sales, use and similar transfer taxes arising out of the contributions, conveyances and deliveries to be made under ARTICLE II , (ii) all documentary, filing, recording, transfer, deed and conveyance taxes and fees required in connection therewith, (iii) legal fees and costs of McGuireWoods LLP, Norton Rose Fulbright US LLP and Pillsbury Winthrop Shaw Pittman LLP, and (iv) any other customary closing costs associated with the contributions of the Assets; and

(b) the Partnership shall pay all of the costs and expenses of the conflicts committee of the board of directors of the General Partner, including, but not limited to, the advisory and legal fees and costs of Andrews Kurth LLP and Evercore Group L.L.C.

Section 6.2 Headings; References; Interpretation . All Article and Section headings in this Agreement are for convenience only and shall not be deemed to control or affect the meaning or construction of any of the provisions hereof. The words “hereof,” “herein” and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole, including, without limitation, all Schedules and Exhibits attached hereto, and not to any particular provision of this Agreement. All references herein to Articles, Sections, Schedules and Exhibits shall, unless the context requires a different construction, be deemed to be references to the Articles and Sections of this Agreement and the Schedules and Exhibits attached hereto, and all such Schedules and Exhibits attached hereto are hereby incorporated herein and made a part hereof for

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all purposes. All personal pronouns used in this Agreement, whether used in the masculine, feminine or neuter gender, shall include all other genders, and the singular shall include the plural and vice versa. The use herein of the word “including” following any general statement, term or matter shall not be construed to limit such statement, term or matter to the specific items or matters set forth immediately following such word or to similar items or matters, whether or not non-limiting language (such as “without limitation,” “but not limited to” or words of similar import) is used with reference thereto, but rather shall be deemed to refer to all other items or matters that could reasonably fall within the broadest possible scope of such general statement, term or matter.

Section 6.3 Successors and Assigns . This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and assigns.

Section 6.4 No Third Party Rights . The provisions of this Agreement are intended to bind the Parties as to each other and are not intended to and do not create rights in any other person or confer upon any other person any benefits, rights or remedies, and no person is or is intended to be a third party beneficiary of any of the provisions of this Agreement.

Section 6.5 Counterparts . This Agreement may be executed in any number of counterparts (including facsimile or .pdf copies) with the same effect as if all Parties had signed the same document. All counterparts shall be construed together and shall constitute one and the same instrument.

Section 6.6 Applicable Law; Forum, Venue and Jurisdiction . This Agreement shall be construed in accordance with and governed by the laws of the State of Texas, without regard to the principles of conflicts of law. Each of the Parties (a) irrevocably agrees that any claims, suits, actions or proceedings arising out of or relating in any way to this Agreement shall be exclusively brought in any federal court of competent jurisdiction situated in the United States District Court for the Western District of Texas, San Antonio Division, or if such federal court declines to exercise or does not have jurisdiction, in the district court of Bexar County, Texas, in each case regardless of whether such claims, suits, actions or proceedings sound in contract, tort, fraud or otherwise, are based on common law, statutory, equitable, legal or other grounds, or are derivative or direct claims, (b) irrevocably submits to the exclusive jurisdiction of the United States District Court for the Western District of Texas, San Antonio Division, or if such federal court declines to exercise or does not have jurisdiction, of the district court of Bexar County, Texas in connection with any such claim, suit, action or proceeding, (c) agrees not to, and waives any right to, assert in any such claim, suit, action or proceeding that (i) it is not personally subject to the jurisdiction of the United States District Court for the Western District of Texas, San Antonio Division, or the district court of Bexar County, Texas, or of any other court to which proceedings in such courts may be appealed, (ii) such claim, suit, action or proceeding is brought in an inconvenient forum, or (iii) the venue of such claim, suit, action or proceeding is improper, (d) expressly waives any requirement for the posting of a bond by a party bringing such claim, suit, action or proceeding and (e) consents to process being served in any such claim, suit, action or proceeding by mailing, certified mail, return receipt requested, a copy thereof to such party at the address in effect for notices hereunder or by personal service within or without the State of Texas, and agrees that service in such forms shall constitute

80950117

good and sufficient service of process and notice thereof; provided, however, that nothing in clause (e) hereof shall affect or limit any right to serve process in any other manner permitted by law.

Section 6.7 Severability . If any of the provisions of this Agreement are held by any court of competent jurisdiction to contravene, or to be invalid under, the laws of any political body having jurisdiction over the subject matter hereof, such contravention or invalidity shall not invalidate the entire Agreement. Instead, this Agreement shall be construed as if it did not contain the particular provision or provisions held to be invalid and an equitable adjustment shall be made and necessary provision added so as to give effect to the intention of the Parties as expressed in this Agreement at the time of execution of this Agreement.

Section 6.8 Amendment or Modification . This Agreement may be amended or modified from time to time only by the written agreement of all the Parties. Each such instrument shall be reduced to writing and shall be designated on its face as an amendment to this Agreement. Notwithstanding anything in the foregoing to the contrary, any amendment executed by the Partnership or any of its subsidiaries shall not be effective unless and until the execution of such amendment has been approved by the Conflicts Committee.

Section 6.9 Integration . This Agreement, together with the Schedules and Exhibits referenced herein, constitutes the entire agreement among the Parties pertaining to the subject matter hereof and supersedes all prior agreements and understandings of the Parties in connection therewith.

Section 6.10 Specific Performance . The Parties agree that money damages may not be a sufficient remedy for any breach of this Agreement and that in addition to any other remedy available at law or equity, the Parties shall be entitled to seek specific performance and injunctive or other equitable relief as a remedy for any Party’s breach of this Agreement. The Parties agree that no bond shall be required for any injunctive relief in connection with a breach of this Agreement.

Section 6.11 Deed; Bill of Sale; Assignment . To the extent required and permitted by applicable law, this Agreement shall also constitute a “deed,” “bill of sale” or “assignment” of the Assets and interests referenced herein. For the avoidance of doubt, the conveyance of the Assets from TRMC, the General Partner or the Partnership to the General Partner, the Partnership or the Operating Company, all as applicable, is not intended to be treated as a sale for tax or any other purposes.

80950117

Section 6.12 Notice . All notices or requests or consents provided for by, or permitted to be given pursuant to, this Agreement must be in writing and must be given by depositing same in the United States mail, addressed to the person to be notified, postpaid, and registered or certified with return receipt requested or by delivering such notice in person or by facsimile to such Party. Notice given by personal delivery or mail shall be effective upon actual receipt. Notice given by facsimile shall be effective upon actual receipt if received during the recipient’s normal business hours or at the beginning of the recipient’s next business day after receipt if not received during the recipient’s normal business hours. All notices to be sent to a Party pursuant to this Agreement shall be sent to or made at the address set forth below or at such other address as such Party may stipulate to the other Parties in the manner provided in this Section 6.12 .

If to Tesoro or TRMC:

Tesoro Corporation

19100 Ridgewood Parkway

San Antonio, Texas 78259-1828

Attn: General Counsel

Facsimile: (210) 745-4494

If to the General Partner, the Partnership or the Operating Company:

Tesoro Logistics LP

c/o Tesoro Logistics GP, LLC, its General Partner

19100 Ridgewood Parkway

San Antonio, Texas 78259-1828

Attn: General Counsel

Facsimile: (210) 745-4494

or to such other address or to such other person as either Party will have last designated by notice to the other Party.

[Signature Page Follows]

80950117

IN WITNESS WHEREOF, the Parties to this Agreement have caused it to be duly executed effective as of the Effective Time.

TESORO CORPORATION

By: /S/ GREGORY J. GOFF

Gregory J. Goff

President and Chief Executive Officer

TESORO REFINING & MARKETING COMPANY LLC

By: /S/ GREGORY J. GOFF

Gregory J. Goff

Chairman of the Board of Managers and President

TESORO LOGISTICS LP

By: Tesoro Logistics GP, LLC,

its general partner

By: /S/ PHILLIP M. ANDERSON

Phillip M. Anderson

President

TESORO LOGISTICS GP, LLC

TESORO LOGISTICS OPERATIONS LLC

By: /S/ PHILLIP M. ANDERSON

Phillip M. Anderson

President

Signature Page to Contribution, Conveyance and Assumption Agreement

EXHIBIT A-1

Assets (Tankage)



	Shell Capacity
Tank #	(Barrels)
TK003	71,100
TK026	97,900
TK033	97,900
TK037	53,688
TK038	53,678
TK217	97,800
TK270	75,400
TK272	75,500
TK274	75,500
TK601	14,600
TK612	10,400
TK613	10,400
TK631	122,700
TK637	71,600
TK638	71,600
TK639	71,600
TK640	71,600
TK641	71,600
TK664	116,500
TK690	283,000
TK691	222,100
TK692	66,000
TK694	283,000
TK696	13,616
TK697	13,500
TK698	13,500
TK701	283,000
TK702	117,300
TK705	210,000
TK706	113,000
TK707	113,000
TK708	283,000
TK709	113,000
TK710	80,000
TK711	80,000
TK777	6

Exhibit A-1 – Page 1

Contribution Agreement



TK778	6
TK849	112,000
TK866	218,400
TK867	218,400
TK868	86,700
TK869	86,700
TK870	119,171
TK871	283,000
TK872	218,400
TK893	114,300
TK894	113,300
TK904	115,600
TK905	126,700
TK932	86,700
TK933	127,000
TK961	190
TK981	190

53 crude and black-oils and petroleum product storage tanks with a total shell capacity of approximately 5,644,845 Barrels and pipelines and other appurtenances that allow the transport of crude oil and petroleum products to and from the nearby dock and to and from other facilities located at TRMC’s refinery near Martinez in Contra Costa County, California.

Exhibit A-1 – Page 2

Contribution Agreement

EXHIBIT A-2

Avon Marine Terminal Assets

All machinery and equipment, mobile or otherwise, systems and other tangible personal property in each case presently owned by TRMC, located in or on the Avon Marine Terminal, including:



Cost Ctr	Asset	SNo.	Cap.date	Asset description
18004	100018779	0	12/31/2002	CARB 3 PROJECT - GASOLINE BLENDING FACILITIES
18004	100029031	0	8/15/2003	CARB 3 PROJECT - GASOLINE BLENDING FACILITIES
18004	100034399	0	5/17/2002	#1-247 WAREHOUSE,4000 SF, PRE-ENG METAL-1951
18004	100034417	0	5/17/2002	#3-129 SCALE OFFICE, 200 SF, PRE-ENG METAL-1951
18004	100034418	0	5/17/2002	#3-130 GAUGER'S OFC, 1500 SF, PRE-ENGMETAL-1951
18004	100034431	0	5/17/2002	BLENDING, TREATING & RACKS
18004	100034892	0	12/31/2002	CARB PHASE 3 - GASOLINE BLENDING
18004	100037036	0	5/27/2005	TR6 PIPING - PHA RECOMMENDATIONS 2004/05
18004	100052436	0	3/28/2013	LINE 68 DIESEL CONVERSION PIPING
18004	100052437	0	3/28/2013	LINE 68 DIESEL CONVERSION INSTRUMENTATION
18004	100052652	0	4/3/2013	DIESEL PUMP TIE-INS PIPING
18004	100052652	1	1/1/2014	DIESEL PUMP TIE-INS PIPING

18004	Fixed Assets

18044	100034882	0	10/15/2002	FIREWATER IMPROVEMENTS - TR 4 / 6
18044	100036473	0	6/30/2004	TANK 38 WATER PUMP/TRACT 4 - FIREWATER SYS UPGRADE

18044

18342	100018841	0	12/27/2002	GASOLINE BLENDER AIR COMPRESSOR & DRYER
18342	100018971	0	1/1/2003	GASOLINE BLENDER AIR COMPRESSOR & DRYER
18342	100034891	0	12/27/2002	GASOLINE BLENDER AIR COMPRESSOR & DRYER
18342	100036006	0	3/8/2004	GASOLINE BLENDING LOGISTICS - PIPING TKS 639 & 640
18342	100036470	0	11/5/2004	CORIOLIS FLOW METER - CHEVRON LACT METER SKID
18342	100036471	0	11/5/2004	6" FISHER ET VALVE - CHEVRON LACT METER SKID
18342	100036764	0	1/1/2005	CORIOLIS FLOW METER - CHEVRON LACT METER SKID
18342	100036765	0	1/1/2005	6" FISHER ET VALVE - CHEVRON LACT METER SKID
18342	100037587	0	12/8/2005	TRANSFORMER - TRACT 4 NEAR TANK 707
18342	100038448	0	9/13/2006	GAUGING - TR4 PUMP P-747 UPGRADE
18342	100038826	0	12/19/2006	TANK RECONSTRUCTION - PHASE 2 - PUMP P-10144
18342	100038827	0	12/19/2006	TANK RECONSTRUCTION - PHASE 2 - PUMP P-10147
18342	100038828	0	12/19/2006	TANK RECONSTRUCTION - PHASE 2 - PUMP P-10148

Exhibit A-2 – Page 1

Contribution Agreement



Cost Ctr	Asset	SNo.	Cap.date	Asset description
18342	100038829	0	12/19/2006	TANK RECONSTRUCTION - PHASE 2 - EXCHANGER E-5150
18342	100038830	0	12/19/2006	TANK RECONSTRUCTION-PHASE 2 - TR4 PIPING UPGRADES
18342	100038831	0	12/19/2006	TANK RECONSTRUCTION - PHASE 2 - TR4 I/E UPGRADES
18342	100038968	0	2/14/2007	GASOLINE BLENDING ANALYZER - FTIR
18342	100039004	0	1/1/2007	GAUGING - TR4 PUMP P-747 UPGRADE
18342	100039046	0	3/28/2007	SECONDARY CONTAINMENT/BERM SYSTEM UPGRADE-TANK 318
18342	100039056	0	2/27/2007	PROCESS HAZARD ANALYSIS 2004/2005 - GAUGING
18342	100039438	0	4/30/2007	CRUDE TRANSFER LINE EXTENSION - TRACK 4
18342	100039439	0	4/30/2007	TANK PIPING CONNECTIONS - TRACK 4 CRUDE SYSTEM
18342	100039440	0	4/30/2007	CRUDE BLENDING INSTRUMENTATION IMPROVEMENTS
18342	100039441	0	6/3/2007	63 CRUDE OIL PIPELINE SECTION-TR3 SLOUGH-TR2 PUMP
18342	100040405	0	1/1/2008	63 CRUDE OIL PIPELINE SECTION-TR3 SLOUGH-TR2 PUMP
18342	100040581	0	1/1/2008	TRACT 4 - PIPELINE IMPR/ADD-CRUDE TRANSFERS
18342	100040950	0	1/1/2008	CRUDE TRANSFER LINE EXTENSION - TRACK 4
18342	100041047	0	1/1/2008	TANK RECON - TR4 PIPING UPGRADE - PUNCHLIST ITEMS
18342	100044693	0	9/1/2009	OFFSITES SUITE - SOFTWARE
18342	100044694	0	9/1/2009	OFFSITES SUITE - SERVER HARDWARE
18342	100044761	0	9/2/2009	PHA - TRACT4 - #26 & #32
18342	100044762	0	1/1/2010	PHA - PUMP 9829 MODIFICATIONS
18342	100044763	0	1/7/2010	PHA - PUMPHOUSE 68 SUMP MODIFICATIONS
18342	100044774	0	1/1/2010	TANK MONITORING EQUIPMENT (TANK #s 134,137, & 318)
18342	100044775	0	1/1/2010	GAUGING/SHIPPING PIPELINE MONITORING EQPT
18342	100045684	0	3/1/2010	TRACT 3 - POWER DISTRIBUTION CENTER - PDC-49
18342	100046189	0	1/1/2011	TR6-DIESEL PIPING UPGRADES RE: TK270
18342	100046190	0	1/1/2011	TR3-DIESEL PIPING UPGRADES RE: TK932
18342	100046371	0	1/1/2011	PHA ASSETS - TR6 - REVISE 68 PUMP HOUSE SUMP#1
18342	100046372	0	1/1/2011	PHA ASSETS - TR6 - REVISE 68 PUMP HOUSE SUMP#2
18342	100048763	0	1/18/2012	PHA - TR4 - MISC VALVES AND PLATFORMS
18342	100048765	0	1/1/2012	PHA - TR6 BLENDING
18342	100048766	0	1/1/2012	PHA - TR6 BLENDING - ELECTRICAL CLASSIFICATION
18342	100048767	0	1/1/2012	SULFUR ANALZER - TR6 GASOLINE BLENDING
18342	100051411	0	11/13/2012	COMMUNICATION AND SECURITY SYSTEM
18342	100051412	0	11/13/2012	FIRE & SAFETY SYSTEM - BAKKEN CRUDE OFFLOADING
18342	100051413	0	11/13/2012	CONTAINMENT PAD AND PAVING
18342	100051413	1	1/1/2013	CONTAINMENT PAD AND PAVING
18342	100051414	0	11/13/2012	TANK TRUCK UNLOADING STATION
18342	100051414	1	1/1/2013	TANK TRUCK UNLOADING STATION
18342	100051415	0	11/13/2012	TRANSFER PIPING FROM UNLOADING STATION TO TK-707
18342	100051415	1	1/1/2013	TRANSFER PIPING FROM UNLOADING STATION TO TK-707
18342	300039718	0	6/30/2012	Permit Cost

Exhibit A-2 – Page 2

Contribution Agreement



Cost Ctr	Asset	SNo.	Cap.date	Asset description
18342	300039719	0	7/31/2012	Contract Services
18342	300062346	0	2/10/2016	Pipe, Valves and Fittings
18342	300062347	0	12/31/2015	Other Machinery & Equipment
18342	300062349	0	12/22/2015	Electrical/Instrument Components
18342	300062353	0	2/26/2016	Equip Installation & Site Fabrication
18342	300062354	0	1/19/2016	Pipe, Valves and Fittings - Installation
18342	300062355	0	12/10/2015	Instrumentation & Automation
18342	300062357	0	2/13/2016	Installation Support
18342	300062360	0	5/24/2016	Survey and Study Costs
18342	300062362	0	10/24/2015	Contract Services
18342	950009345	0	3/19/2015	Repair Costs
18342	950010756	0	2/13/2016	Repair Costs
18342	950010757	0	2/29/2016	Engineering
18342	950010760	0	3/29/2016	Tank Components
18342	950010761	0	4/12/2016	Equipment Rentals
18342	950010762	0	2/24/2016	Contract Services

18342	Gauging-Maint

18343	100036016	0	3/22/2004	TANK 691 - BUTANE STORAGE CONTROLS
18343	100036985	0	5/15/2005	PROPANE/OIL SEPARATOR - VESSEL - TANK 691
18343	100036995	0	5/15/2005	MINIMUM-FLOW CONTROL VALVE STATION- TK691 BLENDING
18343	100036996	0	5/10/2005	PILOT IGNITERS - TANK 691 FLARE
18343	900002699	0	10/29/2015	TANK 691 TURNAROUND - 2015
18343	900002699	1	1/1/2016	TANK 691 TURNAROUND - 2015
18343	950009253	0	12/23/2014	INSTRUMENTATION

18343	LPG Storage-Maint

18365	100034911	0	12/10/2003	AVON WHARF SLOPS TANK - VOC MITIGATION
18365	100035091	0	1/1/2004	AVON WHARF SLOPS TANK - VOC MITIGATION
18365	100040064	0	9/30/2007	AVON SLOP OIL SYSTEM - TANK 906 - BERTH 1
18365	100040065	0	9/30/2007	AVON SLOP OIL SYSTEM - TANK 907 - BERTH 5/6
18365	100040771	0	1/1/2008	ALLISON AVOIDANCE SYSTEM - AVON WHARF
18365	100040772	0	1/1/2008	ALLISON AVOIDANCE SYSTEM - AVON WHARF SOFTWARE
18365	100040953	0	1/1/2008	AVON SLOP OIL SYSTEM - TANK 907 - BERTH 1
18365	100040954	0	1/1/2008	AVON SLOP OIL SYSTEM - TANK 907 - BERTH 5/6
18365	100042602	0	1/1/2008	AVON WHARF - TURNING BASIS MARKERS
18365	100043416	0	1/1/2009	FASB 143 ASSET RETIREMENT COST - AVON WHARF
18365	100043416	1	12/1/2014	FASB 143 ASSET RETIREMENT COST - AVON WHARF
18365	100044680	0	9/25/2009	AVON WHARF LIGHTING IMPROVEMENTS

Exhibit A-2 – Page 3

Contribution Agreement



Cost Ctr	Asset	SNo.	Cap.date	Asset description
18365	100044686	0	9/25/2009	AVON WHARF CALARP-BUILDING STRUCTURE ANCHORAGE
18365	100045144	0	1/1/2010	AVON WHARF LIGHTING IMPROVEMENTS
18365	100048224	0	9/14/2011	Avon Wharf Mooring Dolphin - B3
18365	100048224	1	9/14/2011	Avon Wharf Mooring Dolphin - B3
18365	100048224	2	1/1/2012	Avon Wharf Mooring Dolphin - B3
18365	100048225	0	9/14/2011	Avon Wharf Mooring Dolphin - B4
18365	100048225	1	9/14/2011	Avon Wharf Mooring Dolphin - B4
18365	100048225	2	1/1/2012	Avon Wharf Mooring Dolphin - B4
18365	100051839	0	1/23/2013	AVON WHARF MOORING LINES
18365	300028399	0	3/31/2016	Feasibility Study & Pre-Engineering
18365	300028402	0	1/24/2008	Other Machinery & Equipment
18365	300028404	0	3/20/2013	Electrical/Instrument Components
18365	300028405	0	1/24/2015	Other Materials
18365	300028406	0	11/20/2014	Concrete/Earth
18365	300028408	0	10/31/2015	Piling
18365	300028409	0	3/23/2008	Equip Installation & Site Fabrication
18365	300028411	0	2/28/2015	Instrumentation & Automation
18365	300028412	0	7/29/2011	Electrical
18365	300028413	0	10/20/2015	Installation Support
18365	300028414	0	7/31/2009	Demolition/Removal
18365	300028415	0	9/25/2014	Paint
18365	300028416	0	2/23/2008	Permit Cost
18365	300028417	0	8/31/2007	Contract Services
18365	300040465	0	4/15/2015	Professional Services - Equipment
18365	300040466	0	6/30/2016	In-House Engineering - Equipment
18365	300050691	0	3/31/2015	Contract Services
18365	300059858	0	11/25/2015	Permit Cost
18365	300062440	0	2/10/2016	Vessels
18365	300062443	0	12/31/2015	Pipe, Valves and Fittings - Installation

18365	Avon Wharf_Maint

18816	100034822	0	5/17/2002	SHIPPING REFINED OIL-TRUCKS & TANK CARS

18816	LHP Trtng&tank-OPS

18965	100034856	0	5/17/2002	AVON WHARF
18965	100034856	1	5/17/2002	AVON WHARF
18365	100042606	0	1/1/2008	AVON WHARF-PIPELINE/SUPPORTUPGRADE SOUTH LANDSEND

Exhibit A-2 – Page 4

Contribution Agreement



Cost Ctr	Asset	SNo.	Cap.date	Asset description
	Avon Wharf Slops Tanks
				TK906 - 27 bbls
				TK907 – 27 bbls

Exhibit A-2 – Page 5

Contribution Agreement

EXHIBIT A-3

Avon Wharf Pipeway



Cost Ctr	Asset	SNo.	Cap.date	Asset description
18365	100037201	0	7/15/2005	AVON WHARF PIPING AND SUPPORT - UPGRADE
18365	100037920	0	1/1/2006	AVON WHARF PIPING AND SUPPORT - UPGRADE
18365	100048114	0	1/18/2011	Avon Wharf - Approach Trestle / Structural Pile
18365	1000481226	0	9/16/2011	Avon Wharf – Berth 1 – Piping Manifold
18365	100048226	1	1/1/2012	Avon Wharf – Berth 1 – Piping Manifold

Exhibit A-3 – Page 1

Contribution Agreement

EXHIBIT B

Permitted Liens

Liens, claims, charges, options, encumbrances, mortgages, pledges or security interests as follows:

(a) incurred and made in the ordinary course of business in connection with worker’s compensation;

(b) that secure the performance of bids, tenders, leases, contracts (other than for the repayment of debt), statutory obligations, surety, customs and appeal bonds and other obligations of like nature, incurred as an incident to and in the ordinary course of business;

(c) imposed by law, such as carriers’, warehouseman’s, mechanics’, materialmen’s, landlords’, laborers’, suppliers’ and vendors’ liens, incurred in good faith in the ordinary course of business and that secure obligations that are not yet due or delinquent or which are being contested in good faith by appropriate proceedings as to which the TRMC has set aside on its books adequate reserves;

(d) that secure the payment of taxes, either not yet due or delinquent or being contested in good faith by appropriate legal or administrative proceedings and as to which TRMC has set aside on its books adequate reserves;

(e) zoning restrictions, easements, licenses, rights of way, declarations, reservations, provisions, covenants, conditions, waivers or restrictions on the use of property (and with respect to leasehold interests, mortgages, obligations and liens 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);

(f) on property existing at the time such property was acquired by TRMC (provided, that they were not created in contemplation of the acquisition of such property by TRMC);

(g) created by the Operating Company;

(h) pursuant to this Agreement, the Omnibus Agreement, the Secondment and Logistics Services Agreement, the Martinez Storage Services Agreement, the Avon Marine Terminal Sublease Agreement, the Avon Marine Terminal Use and Throughput Agreement and the License Agreement; and

(i) pursuant to the Master Lease.

Exhibit B – Page 1

Contribution Agreement

EXHIBIT C

Excluded Assets and Liabilities

Excluded Assets and Liabilities related to the Avon Marine Terminal:


◦	Any and all inventory;


◦	Any liabilities with respect to the Avon Marine Terminal Renovation


◦	Any land on which the Avon Marine Terminal is located and any liabilities related thereto; and


◦	Any working capital of TRMC and its Affiliates (other than the General Partner and the Partnership Group) related to such assets.

Excluded Assets and Liabilities related to the Tankage:


◦	Any and all inventory;


◦	Any land on which the Tankage is located and any liabilities related thereto; and


◦	Any working capital of TRMC and its Affiliates (other than the General Partner and the Partnership Group) related to such assets.

Exhibit C – Page 1

Contribution Agreement

EXHIBIT D

Bill of Sale

(See attached.)

Exhibit D – Page 1

Contribution Agreement

EXHIBIT E

Martinez Storage Services Agreement

(See attached.)

EXHIBIT F

License Agreement

(See attached.)

EXHIBIT G

Avon Marine Terminal Operating Agreement

(See attached.)

EXHIBIT H-1 and H-2

Amendment and Service Orders to the Secondment Agreement

(See attached.)

EXHIBIT I

Fourth Amended and Restated Schedules to the Omnibus Agreement

(See attached.)

EXHIBIT J

Amendment No. 5 to Amended and Restated Limited Liability Company Agreement of the General Partner

(See attached.)

EXHIBIT K

Ten-Year Promissory Note

(See attached.)

EXHIBIT L

Debt Indemnification Agreement

(See attached.)

EXHIBIT M

Closing Escrow Agreement

(See attached.)

EXHIBIT N

Avon Marine Terminal Sublease Agreement

(See attached.)

Exhibit E – Page 1

Contribution Agreement

EXHIBIT O

Avon Marine Terminal Use and Throughput Agreement

(See attached.)

Exhibit O – Page 1

Contribution Agreement

Exhibit 3.1

Amendment No. 2
to
First Amended and Restated Agreement of Limited Partnership
of Tesoro Logistics LP

This Amendment No. 2 (this “ Amendment ”), dated November 21, 2016, to the First Amended and Restated Agreement of Limited Partnership of Tesoro Logistics LP (the “ Partnership ”), dated as of April 26, 2011 (and as amended to the date hereof, the “ Partnership Agreement ”), is entered into and effectuated by Tesoro Logistics GP, LLC, a Delaware limited liability company (the “ General Partner ”), in its capacity as general partner of the Partnership and as the holder of all of the Outstanding Incentive Distribution Rights. Capitalized terms used but not defined herein are used as defined in the Partnership Agreement.

WHEREAS, the Partnership has entered into that certain Purchase and Sale Agreement, by and among Whiting Oil and Gas Corporation, a Delaware corporation (“ Whiting ”), GBK Investments, LLC, a Delaware limited liability company, the Partnership and/or one or more of its subsidiaries, and Whiting in its capacity as the Sellers’ Representative (as defined therein) (the “ Robinson Lake Purchase Agreement ”), pursuant to which the Partnership and/or one or more of its subsidiaries will purchase all of the assets relating to certain gas processing and gathering facilities locate in Mountrail County, North Dakota (the “ Robinson Lake Transaction ”);

WHEREAS, the Partnership has entered into that certain Purchase and Sale Agreement, by and among Whiting, WBI Energy Midstream, a Colorado limited liability company, and the Partnership and/or one or more of its subsidiaries (the “ Belfield Purchase Agreement ”), pursuant to which the Partnership and/or one or more of its subsidiaries will purchase all of the assets relating to certain natural gas processing and oil and gas gathering facilities located in Billings, Dunn, and Stark Counties, North Dakota (the “ Belfield Transaction );

WHEREAS, the Partnership has entered into that certain Contribution, Conveyance and Assumption Agreement (the “ Contribution Agreement ”) pursuant to which Tesoro Refining & Marketing Company LLC will contribute, convey and assign to the General Partner, the General Partner will contribute, convey and assign to the Partnership and the Partnership will contribute, convey and assign to one of its subsidiaries (a) approximately 2.6 million barrels of crude oil and other feedstock storage and approximately 2.9 million barrels of refined product storage located at TRMC’s refinery in Martinez, California, (b) all of its interest in the Avon Marine Terminal Facility, and (c) those other assets and facilities necessary or incidental to the foregoing (collectively, the “ Martinez Transaction ”);

WHEREAS, in connection with the final closing of all of the transactions contemplated by the Robinson Lake Purchase Agreement, the Belfield Purchase Agreement and the Contribution Agreement, the General Partner desires to partially waive and forego its right to receive certain distributions from the Partnership with respect to its Incentive Distribution Rights, for the periods and subject to and on the terms and conditions set forth in this Amendment;

WHEREAS, the latest of (i) the Closing Date (as such term is defined in the Robinson Lake Purchase Agreement) of the Robinson Lake Transaction, (ii) the Closing Date (as such term is defined in the Belfield Purchase Agreement) of the Belfield Transaction, and (iii) the Closing Date (as such term is defined in the Contribution Agreement) of the Martinez Transaction, is referred to herein as the “ Final Closing Date ”;

WHEREAS, Section 13.1(d)(i) of the Partnership Agreement provides that the General Partner, without the approval of any Limited Partner, may amend any provision of the Partnership Agreement to reflect a change that, in the discretion of the General Partner, does not adversely affect the Limited Partners (including any particular class of Partnership Interest as compared to other classes of Partnership Interests) in any material respect; and

WHEREAS, the General Partner has determined, in its discretion, that this Amendment does not adversely affect the Limited Partners (including any particular class of Partnership Interest as compared to other classes of Partnership Interests) in any material respect;

NOW, THEREFORE, the General Partner does hereby amend the Partnership Agreement as follows:

1. Section 6.4 of the Partnership Agreement is hereby amended by replacing subsection (c) to such Section, which is no longer applicable, so that it shall read in its entirety as follows:

(c) Limited Partial Reduction of Incentive Distribution Right . Notwithstanding anything to the contrary in this Section 6.4 , any distributions of Available Cash to the holder of the Incentive Distribution Rights (the “ IDR Holder ”) provided for in clauses (iii), (iv) and (v) of Subsection 6.4(b) of the Partnership Agreement, as applicable, shall be adjusted commencing with the payment date of the First Applicable Quarter such that for the Quarterly distributions declared and paid with respect to each of the eight (8) consecutive Quarters beginning with the First Applicable Quarter, the distribution to the IDR Holder shall be reduced by $12,500,000 (but, for the avoidance of doubt, not below zero) (the amount of each such reduction being the “ Reduced Amount ”); provided , that for any such Quarter that is subject to this Section 6.4(c) , the Reduced Amount shall not be distributed at that time. For the purposes of this Agreement, (A) if the Final Closing Date occurs on or prior to December 31, 2016, then the term “ First Applicable Quarter ” shall mean the Quarter beginning on January 1, 2017 and ending on March 31, 2017, and (B) if the Final Closing Date occurs after December 31, 2016, then the term “ First Applicable Quarter ” shall mean the Quarter in which the Final Closing Date occurs.

2. Effectiveness and Termination . This Amendment shall be effective upon execution and delivery if it is executed and delivered on or after the Final Closing Date. To the extent this Amendment is executed and delivered prior to the Final Closing Date, this Amendment will only become effective on the Final Closing Date and shall terminate automatically upon the termination of any of the Robinson Lake Purchase Agreement, the Belfield Purchase Agreement or the Contribution Agreement, without any further action of the parties hereto or thereto. Additionally, this Amendment shall terminate automatically without any further action of the parties hereto if the Final Closing Date has not occurred on or before July 1, 2017.

3. Governing Law . This Amendment shall be governed by, and interpreted in accordance with, the laws of the State of Delaware, all rights and remedies being governed by such laws without regard to principles of conflicts of laws.

4. Binding on Successors . This Amendment shall be binding upon all successors and assigns of the holder of the Incentive Distribution Rights and any and all transferees of the Incentive Distribution Rights, and the General Partner hereby agrees to notify any transferees of the Incentive Distribution Rights of this Amendment.

IN WITNESS WHEREOF, the General Partner has executed this Amendment as of the date first written above.



	GENERAL PARTNER

	TESORO LOGISTICS GP, LLC


	By:	/s/ Phillip M. Anderson
	Name:	Phillip M. Anderson
	Title:	President

EXHIBIT 10.1

FOURTH AMENDED AND RESTATED SCHEDULES

TO THIRD AMENDED AND RESTATED OMNIBUS AGREEMENT

A Third Amended and Restated Omnibus Agreement was executed as of July 1, 2014, and amended as of December 31, 2014 and July 1, 2015 (collectively, the “Third Amended and Restated Omnibus Agreement”), among Tesoro Corporation, on behalf of itself and the other Tesoro Entities, Tesoro Refining & Marketing Company LLC, Tesoro Companies, Inc., Tesoro Alaska Company LLC, Tesoro Logistics LP and Tesoro Logistics GP, LLC, as amended by the First Amended and Restated Schedules to Third Amended and Restated Omnibus Agreement, executed November 12, 2015, the Second Amended and Restated Schedules to Third Amended and Restated Omnibus Agreement, executed July 1, 2016, and the Third Amended and Restated Schedules to Third Omnibus Agreement, executed September 16, 2016. Capitalized terms not otherwise defined in this document shall have the terms set forth in the Third Amended and Restated Omnibus Agreement.

The Parties agree that the Schedules are hereby amended and restated in their entirety as of the date hereof to be as attached hereto. Pursuant to Section 9.12 of the Third Amended and Restated Omnibus Agreement, such amended and restated Schedules shall replace the prior Third Amended and Restated Schedules as of the date hereof and shall be incorporated by reference into the Third Amended and Restated Omnibus Agreement for all purposes.

Executed effective as of November 21, 2016.




	TESORO CORPORATION

	By:	/s/ Gregory J. Goff
		Gregory J. Goff
		President and Chief Executive Officer

	TESORO REFINING & MARKETING COMPANY LLC
	TESORO ALASKA COMPANY LLC

	By:	/s/ Gregory J. Goff
		Gregory J. Goff
		Chairman of the Board of Managers and President

	TESORO COMPANIES, INC.

	By:	/s/ Gregory J. Goff
		Gregory J. Goff
		Chairman of the Board of Directors and President

Signature Page 1 of 2 to Fourth Amended and Restated

Schedules to Third Amended and Restated Omnibus Agreement







	TESORO LOGISTICS LP

	By:	Tesoro Logistics GP, LLC, its general partner
		Tesoro Logistics GP, LLC, its general partner

	By:	/s/ Phillip M. Anderson
		Phillip M. Anderson
		President

	TESORO LOGISTICS GP, LLC

	By:	/s/ Phillip M. Anderson
		Phillip M. Anderson
		President

Signature Page 2 of 2 to Fourth Amended and Restated

Schedules to Third Amended and Restated Omnibus Agreement

Schedule I

Pending Environmental Litigation

For Initial Contribution Agreement listed on Schedule VII :

None.

For Amorco Contribution Agreement listed on Schedule VII :

None.

For Long Beach Contribution Agreement listed on Schedule VII :

The soil and groundwater on the southern central portion of the site near the 24 inch crude oil line have been impacted with hydrocarbons from a release from the line first observed in September 2011. The California Regional Water Quality Control Board issued an Investigative Order dated September 30, 2011 and to date all requirements of the order have been met. Additional investigative or remedial activities may be required.

For Anacortes Rail Facility Contribution Agreement listed on Schedule VII :

None.

For BP Carson Tranche 1 Contribution Agreement listed on Schedule VII :

The environmental indemnification provisions of the Carson Assets Indemnity Agreement dated as of December 6, 2013 (“ Carson Assets Indemnity Agreement ”), among the Partnership, the General Partner, Tesoro Logistics Operations LLC (the “ Operating Company ”) and TRMC, supersede in their entirety the environmental indemnification provisions of Article III of the Third Amended and Restated Omnibus Agreement, except as otherwise expressly provided in the Carson Assets Indemnity Agreement.

For BP Carson Tranche 2 Contribution Agreement listed on Schedule VII :

The environmental indemnification provisions of the Carson Assets Indemnity Agreement supersede in their entirety the environmental indemnification provisions of Article III of the Third Amended and Restated Omnibus Agreement, except as otherwise expressly provided in the Carson Assets Indemnity Agreement.

For West Coast Assets Contribution Agreement listed on Schedule VII:

None.

For 2015 Line 88 and Carson Tankage Contribution Agreement listed on Schedule VII:

None.

Page 1 /2 of Schedule I to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

For 2016 Alaska Assets Contribution Agreement listed on Schedule VII:

KENAI TANKAGE: Tesoro, Tesoro Alaska, TRMC, the Partnership and the General Partner are subject to a pending consent decree with the United States Environmental Protection Agency and the Department of Justice pursuant to which injunctive relief will be ordered with respect a number of refineries (the “2016 Environmental Consent Decree”).

ANCHORAGE AND FAIRBANKS TERMINALS: Tesoro, Tesoro Alaska, TRMC, the Partnership and the General Partner are subject to the pending 2016 Environmental Consent Decree pursuant to which injunctive relief will be ordered with respect a number of refineries.

The indemnification obligations of the Tesoro Entities under Section 3.1(a) of the Third Amended and Restated Omnibus Agreement with regard to the 2016 Environmental Consent Decree are limited as provided in Schedule IX.

For Martinez Assets Contribution Agreement listed on Schedule VII:

Tesoro, Tesoro Alaska, TRMC, the Partnership and the General Partner are subject to the 2016 Environmental Consent Decree.

Page 2 /2 of Schedule I to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

Schedule II

Environmental Matters

For Initial Contribution Agreement set forth on Schedule VII :

1. Anchorage #1 Terminal soil and groundwater have been impacted by gasoline and diesel releases from previously buried pipelines. The site is considered characterized and is currently undergoing removal of product from the water table, groundwater treatment, and long-term monitoring.

2. Anchorage #2 Terminal soil and groundwater have been impacted by gasoline releases occurring prior to Tesoro’s purchase of the facility. The site is considered characterized and is currently undergoing groundwater monitoring and treatment. Off-site groundwater investigations are scheduled for 2012.

3. Stockton Terminal soil and groundwater have been impacted by gasoline and diesel releases from pipelines and/or product storage tanks. The site is considered substantially characterized and is undergoing groundwater treatment and groundwater monitoring. Off-site groundwater impacts are commingled with neighboring petroleum storage terminals.

4. Burley Terminal groundwater was impacted by gasoline releases occurring prior to Tesoro’s purchase of the facility. Groundwater impacts were commingled with neighboring petroleum storage terminals. Hydrocarbon concentrations in groundwater samples do not exceed previously established target levels for groundwater and surface water protection. Regulatory closure is pending.

5. Wilmington Sales Terminal soil and groundwater have been impacted by gasoline releases occurring prior to Tesoro’s purchase of the facility. Groundwater investigation and monitoring is on-going. Tesoro is indemnified by the previous owner for Investigation and remediation obligations.

6. Salt Lake City Terminal soil and groundwater have been impacted by gasoline and diesel releases from pipelines and/or product storage tanks occurring prior to Tesoro’s purchase of the facility. The site is considered characterized and is currently undergoing removal of product from the water table and long-term monitoring. There are no known soil or groundwater impacts at the Northwest Crude Oil tank farm.

7. The Stockton Terminal emits volatile organic compounds (VOCs) below “major source” emission criteria. In 2010, the San Joaquin Air Quality Management District announced it is reducing its major source threshold. When the Stockton Terminal expands its operations or increases throughput, the potential to emit VOC will increase and the Stockton terminal will become subject to regulation as a major source. This will require a Title V Air Operating Permit. In addition, the Stockton facility will be required to install an automated continuous emission monitor at a cost of approximately $75,000.

Page 1 /8 of Schedule II to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

For Amorco Contribution Agreement set forth on Schedule VII :

1. The soil and groundwater on the site of the Tankage, as defined in the Amorco Contribution Agreement, have been impacted by methyl tertiary butyl ether releases from previously buried pipelines. The site is considered characterized and is currently undergoing removal of methyl tertiary butyl ether from the water table, groundwater treatment, and long-term monitoring.

2. Any environmental violation or contamination due to SHPL, as defined in the Amorco Contribution Agreement, being underground prior to the Closing Date.

For Long Beach Contribution Agreement listed on Schedule VII :

1. Any environmental violation or contamination, as defined in the Long Beach Contribution Agreement, prior to the Closing Date.

2. Any anomalies in the Pipeline System that require repair as discovered by the first internal line inspection of any portion of the Pipeline System for which TRMC is notified in writing prior to the First Deadline Date.

For Anacortes Rail Facility Contribution Agreement listed on Schedule VII :

None.

For BP Carson Tranche 1 Contribution Agreement listed on Schedule VII :

For BP Carson Tranche 2 Contribution Agreement listed on Schedule VII :

For West Coast Assets Contribution Agreement listed on Schedule VII:

1. Nikiski Terminal. Subsurface soil and groundwater has not been assessed at this facility. There have been no historic releases that have prompted a soil and groundwater investigations. The area within the tank containment berms was lined with low-permeability soils in the early 1990s. The loading rack, fuel filters and piping manifolds are above concrete secondary containment.

Page 2 /8 of Schedule II to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

2. Anacortes Light Ends Rail Facility and planned diesel truck rack areas. Subsurface soil and groundwater has not been assessed at this area of the Anacortes refinery. There have been no historic releases that have prompted a soil and groundwater investigation.

3. Anacortes Storage Facility . Historic tank overtopping events and tank bottom corrosion releases have impacted soil and groundwater in the shore tank area of the Anacortes refinery. Groundwater near the shore tanks is monitored for natural attenuation. Groundwater between the tanks and the nearby shoreline has not been characterized, however the hydrocarbon concentrations in this area is not expected to be a threat to human health or the environment.

4. Martinez Refinery LPG Loading Area . Past waste disposal and hydrocarbon releases have impacted areas surrounding the Martinez Refinery LPG loading rack, pad and tanks. Areas north and northeast of the rack were used for past waste disposal. There are documented intra-refinery pipeline releases in the north and western boundaries of the LPG rack concrete pad. The refinery plans to excavate and cap the nearby waste disposal area in 2017. The pipeline releases are being remediated as part of the overall Martinez refinery cleanup. Soil and groundwater directly beneath the loading rack, propane tanks and truck pad have not been sampled.

5. Tesoro Alaska Pipeline.

•

The pump station for the Tesoro Alaska Pipeline is adjacent to the Kenai Refinery Lower Tank Farm. Multiple historic tank and buried pipeline releases have impacted soil and groundwater in the area; however there are no documented releases from the pipeline pump station. The soil and groundwater surrounding the pump station is considered characterized and undergoing groundwater monitoring and treatment.

•

A pipeline release in 2001 resulted in soil, groundwater and surface water impacts in an undeveloped area of the Kenai Peninsula. The quantity of the release is not known. Soil surrounding the release was excavated and stockpiled at the Kenai Refinery while groundwater and surface water were remediated on-site. The Alaska Department of Environmental Conservation issued a No Further Action letter for this cleanup effort in 2008. There are no other known release sites on the pipeline between the Kenai Refinery and Anchorage.


•	Historic spills and releases have impacted the Anchorage #1 terminal, including past releases from the Tesoro Alaska Pipeline receiving station. Groundwater remediation monitoring is ongoing across the Anchorage #1 terminal. In addition, a soil vapor venting system is being installed to address a flame suppressant compound detected in soils near the receiving station control room.

For 2015 Line 88 and Carson Tankage Contribution Agreement listed on Schedule VII:

None

Page 3 /8 of Schedule II to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

For 2016 Alaska Assets Contribution Agreement listed on Schedule VII:

KENAI TANKAGE:

Area of significant groundwater and soil impacts: (1) lower tank farm groundwater impact source area including 1988 jet fuel release and unknown light products release in area of Tank 63, (2) process unit historic releases from oily water sewer system including releases from failed grout in subsurface sewer hubs, (3) groundwater issues generally 35 to 40 feet below ground surface and groundwater impacts in three water-bearing zones below refinery and off-site and (4) possible contributor to refinery-wide groundwater impacts.

ANCHORAGE AND FAIRBANKS TERMINALS:

Pursuant to the Contribution, Conveyance and Assumption Agreement effective as of July 1, 2016 (the “ Alaska Assets Contribution Agreement ”), among Tesoro Logistics LP, a Delaware limited partnership (the “ Partnership ”), Tesoro Logistics GP, LLC, a Delaware limited liability company and the general partner of the Partnership (the “ General Partner ”), Tesoro Logistics Operations LLC, a Delaware limited liability company (the “ Operating Company ”), Tesoro Alaska Company LLC, a Delaware limited liability company (“ TAC ”) and Tesoro Corporation, a Delaware corporation (“ Tesoro ”), TAC contributed 100% of the limited liability company interests (the “ TAT Interests ”) in Tesoro Alaska Terminals LLC, a Delaware limited liability company (“ TAT ”), to the General Partner, the General Partner contributed 100% of the TAT Interests to the Partnership, and the Partnership contributed 100% of the TAT Interests to the Operating Company, all on the terms and conditions set forth in that contribution agreement.

Prior to the date of the Alaska Assets Contribution Agreement, TAT acquired certain assets defined as the “Anchorage and Fairbanks Terminals” in the Alaska Assets Contribution Agreement from Flint Hills Resources Alaska, LLC pursuant to an Asset Purchase Agreement, dated November 20, 2015 (the “ Flint Hills APA ”), by and between Flint Hills Resources Alaska, LLC and TAC. As described in the Flint Hills APA, the following liabilities existed at the Anchorage and Fairbanks Terminals prior to the closing of the transactions contemplated under the Flint Hills APA:

Anchorage Terminal :


1.	Deviations reported under Anchorage Air Permit No. AQ0235TVP03, Issue Date: April 2, 2014, Effective Date: May 2, 2014


•	Flint Hills Resources Alaska, LLC did not submit a report as required under Condition 68 based upon defects listed in Condition 6.3 discovered during the out of service inspection conducted on T-4216 during July 2014. The deviation report covering this incident is set out in the Flint Hills Resources Alaska, LLC deviation report dated January 29, 2015.

Page 4 /8 of Schedule II to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement


•	Flint Hills Resources Alaska, LLC did not report all emissions or operations that exceed or deviate from the requirements of its permit within 30 days of the end of the month in which the excess emission or deviation occurred. The deviation report covering this incident is set out in the Flint Hills Resources Alaska, LLC deviation report dated January 29, 2015.


•	Flint Hills Resources Alaska, LLC did not perform preventative maintenance in accordance with 40 CFR Subpart ZZZZ within 365 days of effective date on EU IDs 7, 8, and 9. The maintenance was performed 2 days after that date. The deviation report covering this incident is set out in the Flint Hills Resources Alaska, LLC deviation report dated July 30, 2014.


•	Flint Hills Resources Alaska, LLC did not report all emissions or operations that exceed or deviate from the requirements of this permit within 30 days of the end of the month in which the excess emissions or deviation occurred. The deviation report covering this incident is set out in the Flint Hills Resources Alaska, LLC deviation report dated January 29, 2015.


•	On April 10, 2014. ADEC issued Flint Hills Resources Alaska, LLC a letter of Acceptance of the Anchorage Facility Compliance Certificate, and identified 4 deviations from the air permit.


2.	In a letter dated July 22, 2015, the ADEC indicated that the Anchorage Terminal Oil Discharge Prevention and Contingency Plan needed the additional information specified in the July 22, 2015 letter to be submitted in order for the plan renewal to be approved. On September 2, 2015, the facility submitted the requested information and is awaiting ADEC approval.


3.	On May 15, 2015 Flint Hills Resources Alaska, LLC received a notice of failure to pay Air Quality fees relating to Air Permit No. AQ0235TVP03. Those fees were paid on June 2, 2015.


4.	In a letter dated October 1, 2015, ADEC approved the facility’s request for a waiver of secondary containment, subject to the terms of the letter, until March 31, 2016.


5.	On July 24, 2014 ADEC issued a letter to Flint Hills Resources Alaska, LLC advising that Flint Hills Resources Alaska, LLC is a responsible party under Alaska law for the July 22, 2014 Anchorage Facility Jet Fuel release.


6.	On April 21, 2014, ADEC issued a letter to Flint Hills Resources Alaska, LLC advising it that Flint Hills Resources Alaska, LLC is a responsible party under Alaska law for the April 20, 2014 gasoline release.

Fairbanks Terminal :


(i)	In a letter dated May 29, 2015, ADEC detailed items that needed correction related to ADEC’s May 19, 2015 inspection of the terminal and its Oil Discharge Prevention and Contingency Plan. The facility has submitted a response to ADEC and is working with the agency to correct the identified items.

Page 5 /8 of Schedule II to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement


(ii)	On April 24, 2014 ADEC advised Flint Hills Resources Alaska, LLC that the Primary Response Action Contractor is no longer an ADEC approved and registered contractor. Therefore, Flint Hills Resources Alaska, LLC’s Fairbanks Facility Oil Discharge Prevention and Contingency Plan was out of compliance and needed amendment.


(iii)	Two underground storage tanks are located at the Fairbank Terminal, both of which are used to store heating oil. One underground storage tank was removed from the Purchased Site prior to Flint Hills Resources Alaska, LLC’s leasehold.


(iv)	Asbestos materials has been identified and are known to be located at the Anchorage Facility in the following locations:



Material Type	Location(s)	EPA Category
Gray Caulk (10% Chrysotile)	Fire Pump Room, Warehouse	Category II
Sheetrock (4% Chrysotile)	Boiler Room, Warehouse	Category II
Brown Insulation (5% Chrysotile)	Heat Exchanger Building	Category I
Window Caulk (3% Chrysotile)	Warehouse	Category II
Gray Mastic (10% Chrysotile)	Concrete Pad Near Tank 4136	Category II
Black Mastic (6% Chrysotile)	Concrete Pad Near Tank 4136	Category II
Black Mastic (17% Chrysotile)	Exchanger on West Side of Asphalt Tank Farm	Category II
Black Mastic (6% Chrysotile)	Piping located near railroad tracks on Ocean Dock Road.	Category II
Black Mastic (20% Chrysotile)	Piping on side of Tank 4263, East Tank Farm	Category II
White Insulation (60% Chrysotile)	Piping on side of Tank 4263, East Tank Farm	Category I
Mastic/Insulation (20% Chrysotile)	Top skirt of Tank 4263, East Tank Farm	Category I
Mastic (15% Chrysotile)	Sections of buried pipelines	Category II

In the Flint Hills APA, Flint Hills Resources Alaska, LLC noted that it had no knowledge of other asbestos-containing material currently located at the sites purchased by TAT. However, Flint Hills Resources Alaska, LLC noted that asbestos material has been removed in the past during renovation and/or demolition work at the purchased sites.

Page 6 /8 of Schedule II to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

Flint Hills Resources Alaska, LLC stated in the Flint Hills APA that it has no knowledge of polychlorinated biphenyls (“ PCB ”) material or equipment containing PCBs existing at the purchased sites. Flint Hills Resources Alaska, LLC, however, noted that it understands that PCBs may have been present under prior lessees operations of the sites but has no direct knowledge of this.

Flint Hills Resources Alaska, LLC stated in the Flint Hills APA that it understands “disposal areas” to include areas where Hazardous Materials have been Released. See Section 3.11(h) of Seller Disclosure Schedule under the Flint Hills APA for Flint Hills Resources Alaska, LLC’s knowledge regarding disposal areas on the Purchased Sites. In addition, a significant amount of fill material was used to augment the elevation and stability of the soils beneath the Anchorage facility. This fill included debris and materials such as such as wood, metal, and concrete. Flint Hills Resources Alaska LLC stated in the Flint Hills APA that it has no knowledge that the fill material contained Hazardous Materials when it was placed on the site.

Flint Hills Resources Alaska, LLC stated in the Flint Hills APA that:


1.	On July 24, 2014 ADEC issued a letter to Flint Hills Resources Alaska, LLC advising that Flint Hills Resources Alaska, LLC is a responsible party under Alaska law for the July 22, 2014 Anchorage Facility Jet Fuel release.


2.	On April 21, 2014, ADEC issued a letter to Flint Hills Resources Alaska, LLC advising it that Flint Hills Resources Alaska, LLC is a responsible party under Alaska law for the April 20, 2014 gasoline release.


3.	In a letter dated July 22, 2015, ADEC indicated that the Anchorage Terminal Oil Discharge Prevention and Contingency Plan needed the additional information specified in the July 22 letter to be submitted in order for the plan renewal to be approved. On September 2, 2015, the facility submitted the requested information and is awaiting ADEC approval.

Flint Hills Resources Alaska, LLC assumed all environmental liabilities known at the time the Purchased Facilities were acquired from Williams in 2004.

For Martinez Assets Contribution Agreement listed on Schedule VII:

MARTINEZ TANKAGE:

The following pending refinery notices of violation:


1.	Notice issued April 16, 2013 by the Bay Area Air Quality Management District (“ BAAQMD ”) related to liquid discovered on internal floating roof of Tank 870;


2.	Notice issued February 11, 2014 by BAAQMD related to a leaking PV valve on Tract 3 VRS Tank 613; and


3.	Notice issued August 12, 2014 by BAAQMD related to a ½ inch gap at well sliding cover on Tank 692.

Page 7 /8 of Schedule II to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

Existing soil and groundwater contamination has been identified and is being managed under existing programs and agreements by TRMC and third parties, within three (3) solid waste management units located on Tract 3 of the Licensed Premises, on which the crude oil, feedstock and refined product storage tankage are situated, with such waste management units being identified as areas within red or green boundary lines on the WMU HAZARD MAP-Orientation Unit Or System Overall General Sheets, as reflected on the Golden Eagle Refinery Plat, Drawing Number 020-DA-518-001, as copy of which is shown below.

Page 8 /8 of Schedule II to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

Schedule III

Pending Litigation

For Initial Contribution Agreement listed on Schedule VII :

None.

For Amorco Contribution Agreement listed on Schedule VII :

None.

For Long Beach Contribution Agreement listed on Schedule VII :

None.

For Anacortes Rail Facility Contribution Agreement listed on Schedule VII :

None.

For BP Carson Tranche 1 Contribution Agreement listed on Schedule VII:

None.

For BP Carson Tranche 2 Contribution Agreement listed on Schedule VII:

None.

For West Coast Assets Contribution Agreement listed on Schedule VII:

None.

For 2015 Line 88 and Carson Tankage Contribution Agreement listed on Schedule VII:

None.

For 2016 Alaska Assets Contribution Agreement listed on Schedule VII:

KENAI TANKAGE: None.

ANCHORAGE AND FAIRBANKS TERMINALS: None.

For Martinez Assets Contribution Agreement listed on Schedule VII:

None.

Page 1/1 of Schedule III to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

Schedule IV

Section 4.1(a): General and Administrative Services


(1)	Executive management services of Tesoro employees who devote less than 50% of their business time to the business and affairs of the Partnership, including stock based compensation expense


(2)	Financial and administrative services (including, but not limited to, treasury and accounting)


(3)	Information technology services


(4)	Legal services


(5)	Health, safety and environmental services


(6)	Human resources services

Section 4.1(c)(vii): Other Reimbursable Expenses

For Initial Contribution Agreement listed on Schedule VII :

None.

For Amorco Contribution Agreement listed on Schedule VII :

None.

For Long Beach Contribution Agreement listed on Schedule VII :

None.

For Anacortes Rail Facility Contribution Agreement listed on Schedule VII :

None.

For BP Carson Tranche 1 Contribution Agreement listed on Schedule VII :

None.

For BP Carson Tranche 2 Contribution Agreement listed on Schedule VII :

None.

Page 1 /2 of Schedule IV to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

For West Coast Assets Contribution Agreement listed on Schedule VII:

None.

For 2015 Line 88 and Carson Tankage Contribution Agreement listed on Schedule VII:

None.

For 2016 Alaska Assets Contribution Agreement listed on Schedule VII:

KENAI TANKAGE: None.

ANCHORAGE AND FAIRBANKS TERMINALS: None.

For Martinez Assets Contribution Agreement listed on Schedule VII:

None.

Page 2 /2 of Schedule IV to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

Schedule V

ROFO Assets



Asset		Owner

Golden Eagle Avon Wharf Facility (Martinez, California). A wharf facility located on the Sacramento River near the Golden Eagle Refinery consisting of a single-berth dock and related pipelines. The facility does not have crude oil or refined products storage capacity and receives refined products from the Golden Eagle Refinery through interconnecting pipelines for delivery into marine vessels. The facility can also receive refined products and intermediate feedstocks from marine vessels for delivery to the Golden Eagle Refinery.		TRMC

Nikiski Dock and Storage Facility (Nikiski, Alaska). A single-berth dock and storage facility located at the Kenai Refinery that includes five crude oil storage tanks with a combined capacity of approximately 930,000 barrels, ballast water treatment capability and associated pipelines, pumps and metering stations. The dock and storage facility receives crude oil from marine tankers and from local production fields via pipeline and truck, and also delivers refined products from the refinery to marine vessels.		Tesoro Alaska

Anacortes Marine Terminal (Anacortes, Washington). A marine terminal located at the Anacortes Refinery consisting of a crude oil and refined products wharf facility. The marine terminal receives crude oil and other feedstocks from marine vessels and third-party pipelines for delivery to the Anacortes Refinery. The facility also delivers refined products from the Anacortes Refinery to marine vessels.		TRMC

Page 1/1 of Schedule V to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

Schedule VI

Existing Capital and Expense Projects

For Initial Contribution Agreement listed on Schedule VII :

Expense Projects

None.

Capital Projects

1. That certain project related to AFE # 102120001, which provides for side stream ethanol blending into all gasoline at the Salt Lake City terminal by adding truck ethanol unloading capability, utilizing the existing premium day tank for ethanol and delivering premium direct from the Salt Lake City refinery tankage. New ethanol truck unloading facilities will be installed. New Pumps will also be installed for delivering higher volumes of premium gasoline from the Salt Lake City refinery to the Salt Lake City terminal. An ethanol injection skid will be installed along with piping changing to the existing Salt Lake City terminal to allow the ethanol to be injected in the gasoline stream. This project has been completed.

2. That certain project AFE# 112120005 at the Mandan refinery, to update additive equipment to allow the offering of Shell additized gasoline. This project has been completed.

3. That certain project related to AFE # 107120005, which provides for ratio ethanol blending into gasoline on the rack at the Burley, Idaho Terminal by adding truck ethanol unloading capability, adding tankage for ethanol storage and installing new ethanol meters associated with each gasoline loading arm. New ethanol truck unloading facilities will also be installed.

4. That certain project AFE# 104100015-M at the Mandan refinery, to update the truck rack sprinkler system. This project has been completed.

5. That certain project number AFE# 122120002 (TCM Idea# 2010113017) at the Mandan refinery, to upgrade the rack blending hydraulic system to reduce/eliminate inaccurate blends at the load rack.

6. That certain project number TCM Idea # 2011433001 at the Mandan refinery, to move the JP8 to new bay and have three bays for loading product across the rack. This project has been cancelled.

7. That certain project number TCM Idea # 2011432602 at the Stockton terminal, install a continuous vapor emission monitor on the vapor recovery unit for compliance with air quality regulations.

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For Amorco Contribution Agreement listed on Schedule VII :

Expense Projects

All major expense projects that are within the scope of open Work Orders as of the applicable Closing Date.

Capital Projects

1. That certain project related to AFE# 097100014 and AFE# 107100014 at the Amorco terminal, which provide repairs and upgrades to the wharf regarding MOTEMS standards.

2. That certain project related to AFE# 112100001 at the Amorco terminal, which installs a jet mixer system for crude lab testing.

For Long Beach Contribution Agreement listed on Schedule VII :

Expense Projects

1. Any cost that may be incurred to adjust diesel fuel tank vents near light fixtures after a review is conducted and if action is deemed necessary.

2. Costs related to substantial repair or replacement project scheduled for 2012 and 2013 for the pipeline segments in the portion of the Southern California Edison right-of-way area immediately adjacent to the marine terminal to address corrosion, and include IO# 3021407 titled “SCA.Wilmington Edison Reroute” and IO# 3021749 titled “SCA.Edison Reroute 24 inch, 16 inch, 14 inch”.

Capital Projects

1. That certain project related to AFE# 072104079LBT titled “UG Piping - LBT” related to underground pipeline repairs at the Terminal. In addition, any subsequent new projects to address the same specific under-ground piping issues per AFE# 072104079LBT (i.e. a second phase UG Piping project) that would occur on or before the end of year 2015.

2. That certain project related to the TCM Idea# 2012433432 AFE# 125120020 titled “LBT Berth 84a Loading Arm Replacement” which repairs or replaces the loading arms at the Terminal and any related AFE project that will occur upon final project approval to substantially repair or replace the loading arms at the Terminal.

3. That certain project related to the TCM Idea# 2012433433 AFE# 125120021 titled “LBT Berth 86 Loading Arm Replacement” which repairs or replaces the loading arms at the Terminal and any related AFE project that will occur upon final project approval to substantially repair or replace the loading arms at the Terminal.

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4. Any remaining costs of those certain projects related to the leak detection on the Terminal and Terminal Pipelines which are substantially complete and include AFE# 107110002, AFE# 117110001, AFE# 117110003, AFE# 117110002, and AFE# 125120002.

For Anacortes Rail Facility Contribution Agreement listed on Schedule VII :

Expense Projects

None.

Capital Projects

Any capital costs or expenses that may be incurred for the installation of a custody transfer meter related to the AFE# 125120017 titled “CROF Custody Transfer Meter and Station”.

For BP Carson Tranche 1 Contribution Agreement listed on Schedule VII :

Expense Projects

Expenses associated with the API 653 internal inspection, the Carson Crude Terminal Tank 401 (AFE# 13E1219120001BP/WBS 19125.E012.975) scheduled to start in November 2013, including without limitation, cleaning of such Tank (including any waste removal) and any repairs to such Tank required as a result of such inspection.

Capital Projects

None.

For BP Carson Tranche 2 Contribution Agreement listed on Schedule VII :

Expense Projects

1. All 2013 and 2014 costs related to AFE# 136104215BP-M (PRISM ID 32503) for a partial replacement of Rhodia Sulfuric Acid Line 29 will be reimbursed by TRMC to cover the 2014 expenditure of $1.1 million for line neutralization, the pig run and tie-ins. Subject to confirmation with the refinery on exact outage dates, the bulk of this cost will be incurred in March and April.

2. All 2013 costs or 2013 carry-over costs related to AFE# 13E1012000002BP-M12 & 13E1012000002BP-M5 PRISM ID 32518 (under the 2013 AFE # 13E1012000002BP) for the Manual Entry Corrosion Program at Terminal 2 will be reimbursed by TRMC. All 2014 costs will be covered by the Partnership’s 2013 budget.

3. All remaining 2013 inspection and repair costs related to AFE# 13E1012000002BP-M2 (PRISM ID 32549) associated with the Marine Terminal 2 - TK 218 - API 653 Internal Inspection only (not including repairs at this point) will be reimbursed by TRMC. TRMC shall review and

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approve the tank repair scope and review inspection reports to prevent unnecessary upgrades or “urban renewal.”

4. All remaining 2013 inspection and repair costs related to AFE# 13E1212000001-M (PRISM ID 31418) associated with the Marine Terminal 2 - TK 205 - API 653 Internal Inspection only (not including repairs at this point) will be reimbursed by TRMC. TRMC shall review and approve the tank repair scope and review inspection reports to prevent unnecessary upgrades or “urban renewal.”

5. Remaining expenses related to AFE# 13E1179000001-M (PRISM ID 32040) to upgrade PLC systems in the LA Basin will be reimbursed by TRMC.

6. All remaining 2013 inspection and repair costs related to AFE# 13E1212000002-M (PRISM ID 31419) associated with the Marine Terminal 2 - TK 217 - API 653 Internal Inspection only (not including repairs at this point) will be reimbursed by TRMC. TRMC shall review and approve the tank repair scope and review inspection reports to prevent unnecessary upgrades or “urban renewal.”

7. All remaining expenses related to AFE# 136104222BP-M (PRISM ID 32556) associated with the Pipeline OQ Verification will be reimbursed by TRMC.

8. All remaining 2013 inspection and repair costs related to AFE# 13E1012000006-M (PRISM ID 31409) associated with the Carson Products - TK VH1 - API 653 Inspection only (not including repairs at this point) will be reimbursed by TRMC. TRMC shall review and approve the tank repair scope and review inspection reports to prevent unnecessary upgrades or “urban renewal.

Capital Projects

1. Maintenance capital expenditures related to that certain AFE# 136104194BP-M (PRISM ID 32480) at Terminal 2 to replace all fire water piping at Berths 76, 77 and 78 areas of Terminal 2 in Long Beach, CA with new piping. This project will also replace all associated valves, fixtures, monitors, and fire-fighting accessories.

2. Maintenance capital expenditures related to that certain TCM Idea# 2013434229 (PRISM ID 25829) at Terminal 2 to replace the existing bladder type foam tank with two atmospheric tanks and foam skids located at either end of the facility along with new piping to support the installation.

3. Maintenance capital expenditures related to that certain TCM Idea# 2013434243 (PRISM ID 20054) at Terminal 2 to replace the existing loading arms at T2's Berth 77 and 78. The current parts are so old that they are no longer readily available, so in order to properly maintain this equipment to minimize down-time for repairs, these arms should be replaced with the newest models.

4. All capital expenditures related to that certain AFE# 136104077BP-M (PRISM ID 32481) for MOTEMS dock side piping upgrades at Terminal 2.

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5. Maintenance capital expenditures related to that certain AFE# 145120008 (PRISM ID 32560) at Terminal 2 to replace the main 12kV electrical switchgear that experienced electrical damage due to several factors: nearing its equipment service life, component degradation, exposure to the elements. The main copper busbar component of the switchgear was recently replaced and dipped in epoxy coating. However, during the repairs, cracks on the insulation of the main horizontal operating bus were discovered. The exterior enclosure is slowly showing signs of corrosion and the glastic insulation materials are degrading.

6. Upon TRMC’s approval to complete the following projects, all capital costs incurred to connect the Los Angeles Wilmington and Carson refinery systems, as well as the crude and product pipeline systems: TCM Idea# 2013434786, AFE# 132110022-M (TCM Idea# 2013434419), TCM Idea# 2013434788, AFE# 132110023-M (TCM Idea# 2013434417), AFE# 132110025-M (TCM Idea# 2013434418), AFE# 132110030-M (TCM Idea# 2013434420), AFE# 132110031-M (TCM Idea# 2013434784), TCM Idea# 2013434785 and AFE# 132110026 (TCM Idea# 2013434137).

7. Upon TRMC’s approval to complete the project, all capital costs related to the project at Terminal 2 targeted to reduce Tesoro’s demurrage cost due to barge delivered additive alternative, under AFE# 132110024-M (TCM Idea# 2013434220).

8. All capital costs related to AFE# 131907046, the implementation of an equivalent solution using Tesoro ECC 6 MOC module, including necessary configuration changes and customization of interfaces to be completed and executed in line with other transformation projects identified as part of integrating other BP assets such as TMS5 to DTN Guardian3, Load Tracker, etc. in the Logistics area.

9. All capital costs related to AFE# 131907047. As a part of the BP Carson Tranche 1 Contribution Agreement, Tesoro acquired Maximo, i-Maintain, Maximo Mobile and Primavera. These applications are used for scheduling and managing routine maintenance tasks and planning capital projects (Primavera). These business functions will be transitioned to SAP PM (using GWOS) and a TSO instance of Primavera. This initiative should be performed in line with Maximo to SAP PM transformation project and with other logistics and refining projects.

10. All capital costs related to AFE# 131907045. This project, in conjunction with Tesoro's acquisition of the BP Carson City Refinery, is designed to transition and successfully integrate the Southwest's Logistics Mechanical Integrity Inspection System Information Technology assets into the Tesoro Information Technology application landscape.

For West Coast Assets Contribution Agreement listed on Schedule VII:

Expense Projects

1. Nikiski Terminal . Tesoro Alaska shall reimburse the Partnership Group for any costs or expenses incurred by the Partnership Group to reinstate water supply to the Operating Company’s Nikiski Terminal in connection with the water suppression system.

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2. Anacortes Light Ends Rail Facility. TRMC shall reimburse the Partnership Group for any costs and expenses incurred by the Partnership Group:

◦ to determine the adequacy of fire water at the facility;

◦ with respect to any modifications needed to be made to fire water system to provide adequate fire water; and

◦ for relocation of the knockout drum, if relocation is required.

3. Anacortes Storage Facility

• TRMC shall reimburse the Partnership Group for any costs and expenses incurred by the Partnership Group to restore Tank 135 to API 653 specifications. TRMC shall be deemed to be the generator of all hazardous waste and other waste removed from Tank 135 in connection with such cleaning and restoration and shall be responsible for all obligations arising as the generator of such hazardous waste and other waste.

• TRMC shall reimburse the Partnership Group for any costs and expenses incurred by the Partnership Group for decommissioning and repair of sewer lines for Tanks 165 and 166.

4. Martinez Light Ends Rail Facility . TRMC shall reimburse the Partnership Group for any costs and expenses incurred by the Partnership Group:

◦ to determine the adequacy of fire water at the facility; and

◦ with respect to any modifications needed to be made to fire water system to provide adequate fire water.

5. Martinez Clean Products Truck Rack . TRMC shall reimburse the Partnership Group for any costs and expenses incurred by the Partnership Group:

◦ if required to supplement data currently available in the baseline inspections records in order to properly document corrosion, to carry out new tank corrosion inspections on Tanks 777, 778 and 890, as well as any repairs resulting from such inspections to meet API 653 standards; and

◦ with respect to Tank 777, the tank berm size and tank proximity evaluation scheduled to completed by year-end 2014, as well as any required adjustments resulting therefrom.

6. Martinez Light Ends Storage . If required to supplement data currently available in the baseline inspection records in order to properly document pipe integrity, TRMC shall reimburse the Partnership Group for any costs and expenses incurred by the Partnership Group for inspections and analyses conducted to confirm baseline pipe integrity by year-end 2014, as well as any repairs arising from defects identified through such inspections.

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7. Tesoro Alaska Pipeline

• Tesoro shall reimburse the Partnership Group for any costs or expenses incurred by the Partnership Group to carry out the repairs and tests identified in the Coffman Engineers report dated May 8, 2014, including the planned hydro-test in 2015 and any resulting repairs therefrom.

• Tesoro shall reimburse the Partnership Group for any costs or expenses incurred by the Partnership Group to carry out repairs identified pursuant to the inspection on the Tesoro Alaska Pipeline as a result of the inspection scheduled to begin June 30, 2014.

Capital Projects

Martinez Capital Projects

1. All capital costs related to AFE# 127100012 - Design, procure, and install Biodiesel Blending Facility at existing Martinez Tract 3 Truck Loading Rack.

2. All capital costs related to AFE# 132100017 - Martinez gasoline loading rack filtration.

3. All capital costs related to AFE# TBD regarding Fall Protection for Top Loading Tank Cars and Trucks.

4. All capital costs related to AFE# 132100017 regarding the installation of a new Tract 3 Gasoline Loading Rack Filtration System to replace the existing rental units.

5. All capital costs related to AFE# PTS 12475 regarding LPG Tank Car Loading Rack Improvements.

6. All capital costs related to AFE# TBD regarding the installation of a system to add ExxonMobil additives to gasoline at the Tr. 3 truck loading rack.

7. All capital costs related to AFE# 145110009 regarding the implementation of Tesoro Alaska Pipeline mainline delivery strainer.

Alaska Capital Projects

1. All capital costs related to AFE# 125100055 - Additive reservoir tank and pumping system for the Nikiski Terminal truck loading rack.

2. All capital costs related to AFE# 125110005 - Fabrication and installation of a skid-mounted clay treatment system at the Tesoro Alaska Pipeline Port of Anchorage delivery facility.

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5. All capital costs related to AFE# 125110007 - Provision of inline strainers upstream of the Kenai Pump station pipeline pumps and upstream of the Anchorage receiving station control valve.

6. All capital costs related to AFE# 124100034 - Purchase and installation of (5) IP CCTV Cameras, and security video monitoring station for Tesoro Alaska Pipeline Anchorage control room (located at the Port of Anchorage Industrial Park), MLV 7 on Northernlights Blvd, and the ASIG Filter Building located at Ted Stevens International Airport.

7. All capital costs related to AFE# 145110002 regarding the installation of semi-deep cathodic protection wells, a new rectifier and electrical service at the Tesoro Alaska Pipeline.

8. All capital costs related to AFE# 124100030 regarding new CCTV monitoring system at the Nikiski Terminal.

9. All capital costs related to AFE# 145120005 regarding a new cathodic protection anode bed and rectifier for the Nikiski Terminal.

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For 2015 Line 88 and Carson Tankage Contribution Agreement listed on Schedule VII:

Capital Projects

TRMC shall reimburse the Partnership Group for:

1. Upon mutual consent on project scope between TRMC and the Partnership, TRMC shall reimburse the Partnership Group for all capital costs incurred for the execution of the following piping systems projects: AFE# 136104160BP (TCM Idea# 2013218160), TCM Idea# 2013212538, TCM idea# 2013212540 and TCM Idea# 2013212539. For any such projects listed above in this section 1 that are required to maintain safe operation of the Assets, the Partnership shall determine the final project scope in its sole discretion.

2. Upon mutual consent on project scope between TRMC and the Partnership, TRMC shall reimburse the Partnership Group for all capital costs incurred for the execution of the following instrumentation and control projects: AFE# 154100014 (TCM Idea# 2014217001), TCM Idea #2014217008, AFE# 136104169BP (TCM Idea# 2013218169), AFE# 136104190BP (TCM Idea# 2013218190), TCM Idea# 2013212558, and TCM Idea # 2014217023. For any such projects listed above in this section 2 that are required to maintain safe operation of the Assets, the Partnership shall determine the final project scope in its sole discretion.

3. Upon mutual consent on project scope between TRMC and the Partnership, TRMC shall reimburse the Partnership Group for all capital costs incurred for the execution of the following tank improvements: TCM Idea# 2014217135 (tk 56), TCM Idea# 2013212585 (tk 1), TCM Idea# 2014217132 (tk 90), TCM Idea# 2014217133 (tk 11), TCM Idea# 2013212575 (tk 34), TCM Idea # 2013212587 (tk 35), TCM Idea# 2013212588 (tk 10), TCM Idea# 2013212589 (tk 58), TCM Idea# 2013212592 (tk 39), TCM Idea# 2013212593 (tk 968), TCM Idea# 2013212595 (tk 60), TCM Idea# 2013212596 (tk 69), TCM Idea # 2013212597 (tk 57), TCM Idea# 2013212599 (tk 51). For any such projects listed above in this section 3 that are required to maintain safe operation of the Assets, the Partnership shall determine the final project scope in its sole discretion.

4. All capital costs related to the repair or replacement of brick structure piping supports, with the scope of repairs to be developed in 2016 and the execution of such repairs to be completed in 2017.

5. All capital costs related to the upgrade or replacement of the cathodic protection system for the tanks as identified through a cathodic protection assessment to be completed prior to year end 2016. An action plan will be developed to address recommendations identified through the assessment. The program is expected to commence in 2016 and will be executed over a 4-year period.

6. All capital costs related to the multi-phase upgrade or replacement of tank level measurement and transmitter instruments, upon mutual consent of TRMC and the Partnership

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of the scope for the multi-year project. Notwithstanding the foregoing, the Partnership in its sole discretion shall determine the final scope of any element of the tank level instrument upgrade project required to maintain safe operation of the Assets. TRMC’s reimbursement to the Partnership Group for capital costs incurred during the Term to complete the tank level instrument upgrade or replacement project shall not exceed $15,000,000 in the aggregate.

Expense Projects

1. With respect to the Remaining Pipeline 88 Interest (as defined in the 2015 Line 88 and Carson Tankage Contribution Agreement listed on Schedule VII), TRMC shall reimburse the Partnership for any costs and expenses associated with curing any anomalies identified by the August 2015 in-line inspection thereof.

2. With respect to the Tankage (as defined in the 2015 Line 88 and Carson Tankage Contribution Agreement listed on Schedule VII), as well as the land on which such Tankage is located, TRMC shall reimburse the Partnership for any costs and expenses associated with any liabilities, costs and expenses that might be imposed upon the Partnership as operator of the Tankage and which relate to the environmental condition of the land on which the Tankage is located and surrounding lands, including but not limited to any government-imposed fines or remediation costs and natural resource damages, but excluding (i) any liabilities, costs and expenses that arise from any releases or discharges of hydrocarbons or other substances from the Tankage after the date hereof or (ii) any liabilities, costs and expenses that arise from negligent acts or omissions or willful misconduct of the Partnership and its agents, contractors and representatives.

3. Until the later of (i) November 12, 2020 or (ii) the completion of any repairs identified by any applicable non-invasive or external inspections that occurred prior to such date, TRMC shall reimburse the Partnership Group for any costs and expenses incurred by the Partnership Group to restore any tank included in the 2015 Line 88 and Carson Tankage Contribution Agreement listed on Schedule VII to API 653 or API 510 specifications that are identified through the Partnership Group’s non-invasive or external inspections.

4. During the term (including any extension thereof) of the Carson II Storage Services Agreement, dated as of November 12, 2015, by and among TRMC, the General Partner, the Partnership and the Operating Company (the “Carson II Storage Agreement”), TRMC shall reimburse the Partnership Group for any costs and expenses incurred by the Partnership Group to restore any tank included in the 2015 Line 88 and Carson Tankage Contribution Agreement listed on Schedule VII to API 653 or API 510 specifications, as determined by the results of the first scheduled internal inspection of any such tank after the date hereof (the “First Internal Inspection”). TRMC shall be deemed to be the generator of all hazardous waste and other waste removed from any such tanks in connection with such cleaning and restoration and shall be responsible for all obligations arising as the generator of such hazardous waste and other waste.


a)	TRMC and the Operating Company shall mutually agree on the inspection schedule and the duration of such inspections so as to minimize disruption within

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the Wilmington and Carson refinery systems, with TRMC having the right to approve the final inspection schedule.


b)	If TRMC fails to renew the Carson II Storage Services Agreement, prior to November 12, 2022, in accordance with the terms thereof, the Partnership Group may elect to accelerate API 653 or API 510 inspections prior to the expiration of the Carson II Storage Agreement.

5. Notwithstanding Sections 3 and 4 above, the parties agree that the following tanks included in the 2015 Line 88 and Carson Tankage Contribution Agreement listed on Schedule VII have been inspected, cleaned, and repaired to ensure compliance with API 653 or API 510 standards within the 24 months prior to the date hereof, and are excluded from the reimbursement requirements listed above unless such actions fail to meet such compliance standards due to the negligence of TRMC:



	Tank Number	Year of Last Inspection
	53	2013
	87	2013
	41	2013
	4	2013
	88	2013
	5	2013
	24	2013
	325	2013
	326	2013
	45	2014
	65	2014
	89	2014
	276	2014
	289	2014
	303	2014
	340	2014
	50	2014
	302	2014
	138	2014
	139	2014
	289	2015
	65	2015
	969	2015
	40	2015
	955	2015
	194	2015

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For 2016 Alaska Assets Contribution Agreement listed on Schedule VII:

KENAI TANKAGE:

Capital Projects

TAC shall reimburse the Partnership Group for:

Upon mutual consent on project scope between TAC and the Partnership, TAC shall reimburse the Partnership Group for all capital costs incurred for the execution of the following instrumentation and control projects: AFE# 2012217023 (TCM Idea# 137100002), TCM Idea# 2014216018, TCM Idea# 2007002425. For any such projects listed above in this section 1 that are required to maintain safe operation of the Assets, the Partnership shall determine the final project scope in its sole discretion.

All capital costs related to the assessment and upgrade or replacement of tank level measurement and transmitter instruments, upon mutual consent of TAC and the Partnership of the scope for the multi-year project. Notwithstanding the foregoing, the Partnership in its sole discretion shall determine the final scope of any element of the tank level instrument upgrade project required to maintain safe operation of the Assets.


3.	All capital costs related to installation of tank liners during first API 653 inspection cycle to bring each tank into conformance with Alaska Department of Environmental Conversation standards.


4.	All capital costs related to the assessment and necessary upgrades of cathodic protection system including:


•	Additional anode ground beds


•	Additional surface distributed anodes


•	Additional amperes of cathodic protection for on-grade storage tanks


•	Under tank monitoring systems

The program is expected to commence in 2016 and will be executed over a 3-year period.


5.	All capital costs related to internal inspection, assessment and repair of Tank 11 internal floating roof.

Expense Projects

The parties agree that Tank 37 included in the Alaska Assets Contribution Agreement listed on Schedule VII have been inspected, cleaned, and repaired to ensure compliance with API 653 or API 510 standards within the 24 months prior to the date hereof, and are excluded from the reimbursement requirements listed above unless such actions fail to meet such compliance standards due to the negligence of TAC.

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2.	Any costs or expenses related to:


•	Completion of pressure relief documentation, expected to be complete by year-end 2016.


•	Completion of area classification plans per NEC 500.4, expected to be complete by year-end 2017.

ANCHORAGE AND FAIRBANKS TERMINALS:

Capital Projects

TAC shall reimburse the Partnership Group for:


1.	All capital costs related to:


a)	Anchorage Terminal


•	Installation of permanent fire water pipeline supports with proper coating; expected to be complete by year-end 2017.


•	Assessment, evaluation and potential replacement of two deep anode ground beds (No. 2 and No. 5); expected to be completed within cathodic protection program by year-end 2018.


•	Installation of third tank floor on Tank 4236 with either new cathodic protection system or an El Segundo system; expected to be complete by year-end 2020.


•	Assessment and upgrades to add access platforms and roof protection to east side filter vessels; expected to be complete by year-end 2017.


b)	Fairbanks Terminal


•	Assessment, evaluation and potential replacement of two deep anode ground beds and installation of two new rectifiers to allow ground beds to be operated independently; expected to be completed within cathodic protection program by year-end 2018.

Expense Projects


1.	Any costs or expenses related to:


a.	Anchorage Terminal


•	Inspection and assessment of buried product pipeline; expected to be complete by year-end 2017.


•	Assessment of manual operation of rail car sump tankage; expected to be complete by year-end 2017.


b.	Fairbanks Terminal - Any costs or expenses related to:


•	Arc flash assessment; expected to be complete by year-end 2017.

Relief valve sizing and selection assessment; expected to be complete by year-end 2017.

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For Martinez Assets Contribution Agreement listed on Schedule VII:

Capital Projects

TRMC shall reimburse the Partnership Group for:

1. Upon mutual consent on project scope between TRMC and the Partnership, TRMC shall reimburse the Partnership Group for all capital costs incurred for the execution of the following secondary containment projects identified for Tract 3 and Tract 6: AFE# 127100010 (TCM Idea# 2007000713), TCM Idea# 2012211027. In addition, TRMC shall reimburse the Partnership for any additional capital costs or expenses that are associated with the regulatory mandated validation of secondary containment volumes for the Spill Prevention Controls and Countermeasures Plan. For any such projects listed above in this section 1 that are required to maintain safe operation and compliance of the Assets, the Partnership shall determine the final project scope in its sole discretion.

2. Upon mutual consent on project scope between TRMC and the Partnership, TRMC shall reimburse the Partnership Group for all capital costs incurred for the execution of the following tank repairs, improvements and new build projects: AFE# 152100015 (TCM Idea# 2007000694), TCM Idea# 2007000701, TCM Idea# 2009001043, TCM Idea# 2012211055, TCM Idea# 2012211056, TCM Idea# 2012211080, TCM Idea# 2012211082, TCM Idea# 2013211049, TCM Idea# 2013211073, TCM Idea# 2014211011, TCM Idea# 2014211038, TCM Idea# 2014211040. For any such projects listed above in this section 2 that are required to maintain safe operation and compliance of the Assets, the Partnership shall determine the final project scope in its sole discretion.

3. Upon mutual consent on project scope between TRMC and the Partnership, TRMC shall reimburse the Partnership Group for all capital costs incurred for the execution of the Avon Warf Upgrade project (MOTEMS), AFE# 077100030 (TCM Idea# 2007001314), and the Avon Wharf Pipeline Surge Protection project, AFE # 154100001 (TCM Idea # 2012211075). In addition, TRMC shall reimburse the Partnership for any additional capital costs or expenses that are determined to be required to bring the Avon Wharf into compliance with MOTEMS at the time of the commencement of service of the replacement Wharf, but not for future MOTEMS that may be imposed after the replacement Wharf is approved and permitted for operation. For any such projects listed above in this section 3 that are required to maintain safe operation and compliance of the Assets, the Partnership shall determine the final project scope in its sole discretion.

4. Upon mutual consent on project scope between TRMC and the Partnership, TRMC shall reimburse the Partnership Group for all capital costs incurred for the execution of the following miscellaneous projects: TCM Idea# 2007001600, TCM Idea# 2014211008. For any such projects listed above in this section 4 that are required to maintain safe operation of the Assets, the Partnership shall determine the final project scope in its sole discretion.

5. All capital costs related to the replacement and associated initial permitting requirements of the Marine Vapor Control System.

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6. All capital costs related to the upgrade or replacement of the cathodic protection system for the tanks as identified through a cathodic protection assessment. An action plan will be developed to address recommendations identified through the assessment. The program is expected to commence in 2017 and will be executed over a 4-year period.

7. All capital costs and expenses that may be associated with the Asset Retirement Obligations with respect to the existing Avon Wharf and its berths (but not including any future costs of demolition and retirement of the structures on the replacement Wharf now being constructed).

8. All capital costs and expenses that may be associated with the removal of abandoned pipelines in the Licensed Premises, but only to the extent that such abandoned pipelines have never been used to provide services under the Martinez Storage Services Agreement and such pipelines are then required to be removed pursuant to applicable law, regulation or governmental order.

9. All capital costs and expenses related to the Getty pipeline thermal expansion assessment and potential relocation of the pipeline above ground, per refinery inspection recommendation.

10. All capital costs and expenses related to the assessment and potential repairs to underground storm water piping.

Expense Projects

1. The parties agree that the following tanks included in the Martinez Tankage Contribution Agreement listed on Schedule VII have been inspected, cleaned, and repaired to ensure compliance with API 653 or API 510 standards within the 24 months prior to the date hereof or the next scheduled tank inspection falls beyond the year 2036, and are excluded from the reimbursement requirements listed above unless such actions fail to meet such compliance standards due to the negligence of TRMC.



	Tank Number
	026
	258
	517
	601
	612
	641
	690
	701
	702
	709
	710
	711

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Schedule VII

Contribution Agreements and Applicable Terms

Initial Contribution Agreement



Contribution Agreement	Closing Date	First Deadline Date	Second Deadline Date	Tesoro Indemnifying Parties	Tesoro Indemnified Parties	Third Deadline Date	Omnibus Section 5.1(b) Applies
Contribution, Conveyance and Assumption Agreement, dated as April 26, 2011, among the Partnership, the General Partner, the Operating Company, Tesoro, Tesoro Alaska, TRMC and Tesoro High Plains Pipeline Company LLC	April 26, 2011	April 26, 2013	April 26, 2016	TRMC and Tesoro Alaska	TRMC	April 26, 2021	Yes

Page 1 /10 of Schedule VII to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

Amorco Contribution Agreement



Contribution Agreement	Closing Date	First Deadline Date	Second Deadline Date	Tesoro Indemnifying Parties	Tesoro Indemnified Parties	Third Deadline Date	Omnibus Section 5.1(b) Applies
Contribution, Conveyance and Assumption Agreement dated as of April 1, 2012, among the Partnership, the General Partner, the Operating Company, Tesoro and TRMC	April 1, 2012	April 1, 2014	April 1, 2017	TRMC	TRMC	April 1, 2022	Yes

Page 2 /10 of Schedule VII to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

Long Beach Contribution Agreement



Contribution Agreement	Closing Date	First Deadline Date	Second Deadline Date	Tesoro Indemnifying Parties	Tesoro Indemnified Parties	Third Deadline Date	Omnibus Section 5.1(b) Applies
Contribution, Conveyance and Assumption Agreement executed as of September 14, 2012, among the Partnership, the General Partner, the Operating Company, Tesoro and TRMC	Execution Date is September 14, 2012, and various Effective Times are upon receipt of the Long Beach Approval, the CDFG Approval and the Other Approvals as set forth in the agreement, as applicable	September 14, 2014	September 14, 2017	TRMC	TRMC	September 14, 2022	Yes

Page 3 /10 of Schedule VII to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

Anacortes Rail Facility Contribution Agreement



Contribution Agreement	Closing Date	First Deadline Date	Second Deadline Date	Tesoro Indemnifying Parties	Tesoro Indemnified Parties	Third Deadline Date	Omnibus Section 5.1(b) Applies
Contribution, Conveyance and Assumption Agreement executed as of November 15, 2012, among the Partnership, the General Partner, the Operating Company, Tesoro and TRMC	November 15, 2012	November 15, 2014	November 15, 2017	TRMC	TRMC	November 15, 2022	No

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Third Amended and Restated Omnibus Agreement

BP Carson Tranche 1 Contribution Agreement



Contribution Agreement	Closing Date	First Deadline Date	Second Deadline Date	Tesoro Indemnifying Parties	Tesoro Indemnified Parties	Third Deadline Date	Omnibus Section 5.1(b) Applies
Contribution, Conveyance and Assumption Agreement executed as of May 17, 2013, among the Partnership, the General Partner, the Operating Company, Tesoro and TRMC	June 1, 2013	Not Applicable	Not Applicable	Not Applicable	Not Applicable	Not Applicable	No

Page 5 /10 of Schedule VII to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

BP Carson Tranche 2 Contribution Agreement



Contribution Agreement	Closing Date	First Deadline Date	Second Deadline Date	Tesoro Indemnifying Parties	Tesoro Indemnified Parties	Third Deadline Date	Omnibus Section 5.1(b) Applies
Contribution, Conveyance and Assumption Agreement executed as of November 18, 2013, among the Partnership, the General Partner, the Operating Company, Tesoro, TRMC and Carson Cogeneration Company	December 6, 2013	Not Applicable	Not Applicable	Not Applicable	Not Applicable	Not Applicable	No

Page 6 /10 of Schedule VII to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

West Coast Assets Contribution Agreement



Contribution Agreement	Closing Date	First Deadline Date	Second Deadline Date	Tesoro Indemnifying Parties	Tesoro Indemnified Parties	Third Deadline Date	Omnibus Section 5.1(b) Applies
Contribution, Conveyance and Assumption Agreement executed as of June 23, 2014, among the Partnership, the General Partner, the Operating Company, Tesoro Logistics Pipelines LLC, Tesoro, TRMC and Tesoro Alaska	First Closing Date: July 1, 2014 Second Closing Date has the meaning set forth in this Contribution Agreement	The second (2 ^nd ) anniversary of the First Closing Date or the Second Closing Date, as applicable	With respect to Section 3.1(a): Not applicable With respect to Section 3.2: The fifth (5 ^th ) anniversary of the First Closing Date or the Second Closing Date, as applicable	Tesoro, TRMC, Tesoro Alaska	Tesoro, TRMC, Tesoro Alaska	The tenth (10 ^th ) anniversary of the First Closing Date or the Second Closing Date, as applicable.	Yes

Page 7 /10 of Schedule VII to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

2015 Line 88 and Carson Tankage Contribution Agreement



Contribution Agreement	Closing Date	First Deadline Date	Second Deadline Date	Tesoro Indemnifying Parties	Tesoro Indemnified Parties	Third Deadline Date	Omnibus Section 5.1(b) Applies
Contribution, Conveyance and Assumption Agreement effective as of November 12, 2015, among the Partnership, the General Partner, the Operating Company, Tesoro SoCal Pipeline Company LLC, Tesoro, TRMC and Carson Cogeneration Company	November 12, 2015	November 12, 2017	November 12, 2020	Tesoro, TRMC, Carson Cogen	Tesoro, TRMC, Carson Cogen	November 12, 2025	Yes

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Third Amended and Restated Omnibus Agreement

2016 Alaska Assets Contribution Agreement



Contribution Agreement	Closing Date	First Deadline Date	Second Deadline Date	Tesoro Indemnifying Parties	Tesoro Indemnified Parties	Third Deadline Date	Omnibus Section 5.1(b) Applies
Contribution, Conveyance and Assumption Agreement effective as of July 1, 2016, among the Partnership, the General Partner, the Operating Company, Tesoro Alaska Company LLC, and Tesoro KENAI TANKAGE	July 1, 2016	July 1, 2018	July 1, 2021	Tesoro Alaska Company LLC	Not applicable	July 1, 2026	Yes
Contribution, Conveyance and Assumption Agreement effective as of July 1, 2016, among the Partnership, the General Partner, the Operating Company, Tesoro Alaska Company LLC, and Tesoro ANCHORAGE AND FAIRBANKS TERMINALS	September 16, 2016	September 16, 2018	September 16, 2023	Tesoro Alaska Company LLC	Not applicable	September 16, 2026	Yes

Page 9 /10 of Schedule VII to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

Martinez Assets Contribution Agreement



Contribution Agreement	Closing Date	First Deadline Date	Second Deadline Date	Tesoro Indemnifying Parties	Tesoro Indemnified Parties	Third Deadline Date	Omnibus Section 5.1(b) Applies
Contribution, Conveyance and Assumption Agreement effective as of November 21, 2016, among the Partnership, the General Partner, the Operating Company, TRMC and Tesoro	November 21, 2016	November 21, 2018	November 21, 2021	TRMC	Not applicable	November 21, 2026	Yes

Page 10 /10 of Schedule VII to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

Schedule VIII

Administrative Fee and Indemnification Deductibles

Monthly Administrative Fee

$900,000

Annual Environmental Deductible

$800,000

Annual ROW Deductible

$800,000

Page 1/1 of Schedule VIII to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

Schedule IX

Special Indemnification Provisions

For Initial Contribution Agreement listed on Schedule VII :

None.

For Amorco Contribution Agreement listed on Schedule VII :

Addition to Right of Way Indemnification . As of the Closing Date for the Amorco Contribution Agreement, TRMC shall own the leasehold rights in the “Wharf Lease” issued by the California State Lands Commission and the easements, rights of way and permits for the “SHPL,” all as defined in the Amorco Contribution Agreement, and the Partnership Group shall provide operational, maintenance and management services with respect to such Assets pursuant to the MTUTA. Title to Wharf Lease rights and the SHPL are scheduled to be contributed to the Partnership Group at a later date, as set forth in the Amorco Contribution Agreement. The Right of Way Indemnification set forth in Section 3.2 herein applies to the extent that a Loss arises with respect to a Partnership Group Member’s interests under the MTUTA before title to such Assets is contributed to the Partnership Group Member or with respect to a Partnership Group Member’s failure to become the owner of such valid and indefeasible easement rights or fee ownership or leasehold interests in such Assets after they are finally contributed to the Partnership Group as contemplated in the Amorco Contribution Agreement. The Closing Date provided for in this Agreement shall be as set forth above, without regard to when title to these Assets is finally contributed to a Partnership Group Member.

For Long Beach Contribution Agreement listed on Schedule VII :

Addition to Right of Way Indemnification . As of the Closing Date for the Long Beach Contribution Agreement, TRMC shall own the leasehold rights in the “Terminal Lease” issued by the Port of Long Beach and the easements, rights of way and permits for the “Terminal Pipelines,” all as defined in the Long Beach Contribution Agreement, and the Partnership Group shall provide operational, maintenance and management services with respect to such Assets pursuant to the Long Beach Operating Agreement, as defined in the Long Beach Contribution Agreement. Title to Terminal Lease rights and the Terminal Pipelines are scheduled to be contributed to the Partnership Group at a later date, as set forth in the Long Beach Contribution Agreement. The Right of Way Indemnification set forth in Section 3.2 herein applies to the extent that a Loss arises with respect to a Partnership Group Member’s interests under the BAUTA before title to such Assets is contributed to the Partnership Group Member or with respect to a Partnership Group Member’s failure to become the owner of such valid and indefeasible easement rights or fee ownership or leasehold interests in such Assets after they are finally contributed to the Partnership Group as contemplated in the Long Beach Contribution Agreement. The Closing Date provided for in this Agreement shall be as set forth above, without regard to when title to these Assets is finally contributed to a Partnership Group Member.

Page 1 /5 of Schedule IX to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

For Anacortes Rail Facility Contribution Agreement listed on Schedule VII :

Other . Notwithstanding any other provisions of (i) the Third Amended and Restated Omnibus Agreement, (ii) the Anacortes Track Use and Throughput Agreement among the General Partner, the Partnership, the Operating Company and TRMC, (iii) the Anacortes Mutual Track Use Agreement among the General Partner, the Partnership, the Operating Company and TRMC, and (iv) the Ground Lease between TRMC and the Operating Company, all dated as of November 15, 2012, the parties hereto agree that the indemnification provisions of any of those agreements shall control over any of the other agreements to the extent the subject matter of the indemnification is specifically referenced or provided for in that agreement. For the avoidance of doubt, the indemnification provisions of the Third Amended and Restated Omnibus Agreement shall be subordinate to the respective indemnification provisions of each of the other agreements referenced above.

For BP Carson Tranche 1 Contribution Agreement listed on Schedule VII :

Other . Notwithstanding any other provisions of (i) the Third Amended and Restated Omnibus Agreement, (ii) the BP Carson Tranche 1 Contribution Agreement listed on Schedule VII , (iii) the Master Terminalling Services Agreement - Southern California among TRMC, the General Partner, the Partnership and the Operating Company dated as of June 1, 2013, as amended, and (iv) the Carson Storage Services Agreement among TRMC, the General Partner, the Partnership and the Operating Company dated as of June 1, 2013, the parties hereto agree that the indemnification provisions of any of those agreements shall control over any of the other agreements to the extent the subject matter of the indemnification is specifically referenced or provided for in that agreement. In the event of a conflict of provisions of any of the above-referenced agreements and the Carson Assets Indemnity Agreement, the provisions of the Carson Assets Indemnity Agreement shall prevail with respect to issues related to the contribution of the assets described therein, but not with respect to the ordinary operations of such assets as set forth in the above-referenced agreements. Notwithstanding anything to the contrary in the Third Amended and Restated Omnibus Agreement, the indemnification provisions of Sections 3.2 and 3.5 thereof shall not apply to the Assets as defined in the BP Carson Tranche 1 Contribution Agreement listed on Schedule VII .

Page 2 /5 of Schedule IX to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

For BP Carson Tranche 2 Contribution Agreement listed on Schedule VII :

Other . Notwithstanding any other provisions of (i) the Third Amended and Restated Omnibus Agreement, (ii) the BP Carson Tranche 2 Contribution Agreement listed on Schedule VII , (iii) the Amended and Restated Master Terminalling Services Agreement - Southern California among TRMC, the General Partner, the Partnership and the Operating Company dated as of December 6, 2013, (iv) the Long Beach Storage Services Agreement among TRMC, the General Partner, the Partnership and the Operating Company dated as of December 6, 2013, (v) the Berth 121 Operating Agreement between the Operating Company and Carson Cogeneration Company, dated as of December 6, 2013, (vi) the Terminals 2 and 3 Operating Agreement among the Partnership, the General Partner, the Operating Company and TRMC, dated as of December 6, 2013, (vii) the Amended and Restated Long Beach Berth Access Use and Throughput Agreement among the Partnership, the General Partner, the Operating Company and TRMC, dated as of December 6, 2013, (viii) the Long Beach Berth Throughput Agreement among the Partnership, the General Partner, the Operating Company, TRMC and Carson Cogeneration Company, dated as of December 6, 2013, (ix) the SoCal Transportation Services Agreement between TRMC and Tesoro SoCal Pipeline Company LLC, dated as of December 6, 2013, (x) the Long Beach Pipeline Throughput Agreement among the Partnership, the General Partner, the Operating Company and TRMC, dated as of December 6, 2013, (xi) the Carson Coke Handling Services Agreement among the Partnership, the General Partner, the Operating Company and TRMC, dated as of December 6, 2013, (xii) the Coke Barn Lease Agreement between the Operating Company and TRMC, dated as of December 6, 2013 and (xiii) the Terminals 2 and 3 Ground Lease between the Operating Company and TRMC, dated as of December 6, 2013, the parties hereto agree that the indemnification provisions of any of those agreements shall control over any of the other agreements to the extent the subject matter of the indemnification is specifically referenced or provided for in that agreement. In the event of a conflict of provisions of any of the above-referenced agreements and the Carson Assets Indemnity Agreement, the provisions of the Carson Assets Indemnity Agreement shall prevail with respect to issues related to the contribution of the assets described therein, but not with respect to the ordinary operations of such assets as set forth in the above-referenced agreements.

Page 3 /5 of Schedule IX to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

For West Coast Assets Contribution Agreement listed on Schedule VII:

Other . Notwithstanding any other provisions of (i) the Third Amended and Restated Omnibus Agreement, (ii) the Terminalling Services Agreement - Nikiski, among the General Partner, the Partnership, the Operating Company and Tesoro Alaska, (iii) the Terminalling Services Agreement - Anacortes, among the General Partner, the Partnership, the Operating Company and TRMC, (iv) the Terminalling Services Agreement - Martinez, among the General Partner, the Partnership, the Operating Company and TRMC, and (v) the Storage Services Agreement - Anacortes, the Terminalling Services Agreement - Anacortes, among the General Partner, the Partnership, the Operating Company and TRMC, the parties hereto agree that the indemnification provisions of any of those agreements shall control over any of the other agreements to the extent the subject matter of the indemnification is specifically referenced or provided for in that agreement. In the event of a conflict of provisions of any of the above-referenced agreements and the Third Amended and Restated Omnibus Agreement, the provisions of the Third Amended and Restated Omnibus Agreement shall prevail with respect to issues related to the contribution of the assets described therein, but not with respect to the ordinary operations of such assets as set forth in the above-referenced agreements.

For 2015 Line 88 and Carson Tankage Contribution Agreement listed on Schedule VII:

Other . Notwithstanding any other provisions of (i) the Third Amended and Restated Omnibus Agreement, (ii) the Carson II Storage Agreement, and (iii) Amendment No. 1 to the (SoCal) Transportation Services Agreement dated November 12, 2015, between TRMC and Tesoro SoCal Pipeline Company LLC, the parties hereto agree that the indemnification provisions of any of those agreements shall control over any of the other agreements to the extent the subject matter of the indemnification is specifically referenced or provided for in that agreement. In the event of a conflict of provisions of any of the above-referenced agreements and the Third Amended and Restated Omnibus Agreement, the provisions of the Third Amended and Restated Omnibus Agreement shall prevail with respect to issues related to the contribution of the assets described therein, but not with respect to the ordinary operations of such assets as set forth in the above-referenced agreements.

For 2016 Alaska Assets Contribution Agreement listed on Schedule VII:

Other . The Partnership Group agree that, after the Effective Date, they shall not knowingly breach any covenants of TAC contained in that certain Asset Purchase Agreement dated as of November 20, 2015 by and between Flint Hills Resources Alaska, LLC and TAC (the “Flint Hills APA”) as if the Partnership Group were parties thereto instead of TAC.

Notwithstanding any other provisions of (i) the Third Amended and Restated Omnibus Agreement, (ii) the Kenai Storage Services Agreement, and (iii) the Alaska Terminalling Services Agreement, the parties hereto agree that the indemnification provisions of any of those agreements shall control over any of the other agreements to the extent the subject matter of the indemnification is specifically referenced or provided for in that agreement. In the event of a conflict of provisions of any of the above-referenced agreements and the Third Amended and Restated Omnibus Agreement, the provisions of the Third Amended and Restated Omnibus Agreement shall prevail with respect to

Page 4 /5 of Schedule IX to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

issues related to the contribution of the assets described therein, but not with respect to the ordinary operations of such assets as set forth in the above-referenced agreements.

Notwithstanding any other provisions of the Third Amended and Restated Omnibus Agreement, the indemnification obligations of the Tesoro Entities under Section 3.1(a) of the Third Amended and Restated Omnibus Agreement with regard to the 2016 Environmental Consent Decree are limited to reimbursement for any capital expenditures that the Partnership Group may be required to make to comply therewith and any fines or other penalties which may be levied for any failure therewith (except to the extent such fines or other penalties are the result of the failure of the Partnership Group to comply therewith with regard to the contributed assets) and such indemnification obligations shall extend to or cover any increased ongoing operating or maintenance expenses incurred by the Partnership Group in connection with their compliance therewith.

For Martinez Assets Contribution Agreement listed on Schedule VII:

Notwithstanding any other provisions of (i) the Third Amended and Restated Omnibus Agreement, (ii) the Martinez Storage Services Agreement, dated as of November 21, 2016, between TRMC and the Operating Company; (iii) the Avon Marine Terminal Operating Agreement, dated as of November 21, 2016, between TRMC and the Operating Company; (iv) the License Agreement, dated as of November 21, 2016, between TRMC and the Operating Company; and (v) the Avon Marine Terminal Sublease Agreement and the Avon Marine Terminal Use and Throughput Agreement to be entered into between TRMC and the Operating Company pursuant to Section 2.5 of the Martinez Assets Contribution Agreement, the parties hereto agree that the indemnification provisions of any of those agreements shall control over any of the other agreements to the extent the subject matter of the indemnification is specifically referenced or provided for in that agreement. In the event of a conflict of provisions of any of the above-referenced agreements and the Third Amended and Restated Omnibus Agreement, the provisions of the Third Amended and Restated Omnibus Agreement shall prevail with respect to issues related to the contribution of the assets described therein, but not with respect to the ordinary operations of such assets as set forth in the above-referenced agreements.

Page 5 /5 of Schedule IX to Fourth Amended and Restated Schedules to

Third Amended and Restated Omnibus Agreement

Exhibit 10.2

MARTINEZ

STORAGE SERVICES AGREEMENT

This Martinez Storage Services Agreement (the “ Agreement ”) is effective as of the Commencement Date (as defined below), by and between Tesoro Refining & Marketing Company LLC, a Delaware limited liability company (“ TRMC ”), Tesoro Logistics Operations LLC, a Delaware limited liability company (“ TLO ”), and for purposes of Section 25(a) only, Tesoro Logistics GP, LLC, a Delaware limited liability company (the “ General Partner ”), and Tesoro Logistics LP, a Delaware limited partnership (the “ Partnership ”).

RECITALS

WHEREAS , on the date hereof, TRMC will contribute certain assets to the General Partner, the General Partner will contribute those assets to the Partnership and the Partnership will contribute those assets to TLO pursuant to the Contribution, Conveyance and Assumption Agreement dated as of the date hereof (the “ Contribution Agreement ”);

WHEREAS , pursuant to the Contribution Agreement, TLO is the owner of tankage and blending operations located at TRMC’s refinery near Martinez in Contra Costa County, California, related equipment and ancillary facilities used for the operation thereof, further described in Schedule A attached hereto (the “ Storage Facility ”), which includes without limitation the Tanks and Pipelines defined below;

WHEREAS, TLO desires to provide storage, handling, blending and other services with respect to Products (as defined below) owned by TRMC and stored in one or more of the Tanks;

WHEREAS, the Owned Tanks (as defined below) at the Storage Facility have an aggregate Shell Capacity (as defined below) of approximately 5,644,833 Barrels (as defined below);

WHEREAS, by virtue of its indirect ownership interests in the Partnership, TRMC has an economic interest in the financial and commercial success of the Partnership and its operating subsidiary, TLO; and

WHEREAS , TRMC and TLO desire to enter into this Agreement to memorialize the terms of their commercial relationship related to the subject matter hereof.

NOW, THEREFORE , in consideration of the covenants and obligations contained herein, the Parties (as defined below) to this Agreement hereby agree as follows:

1. DEFINITIONS

Capitalized terms used throughout this Agreement shall have the meanings set forth below, unless otherwise specifically defined herein.

“ Agreement ” has the meaning set forth in the Preamble.

authorization issued by any Governmental Authority having or asserting jurisdiction over the matter or matters in question, whether now or hereafter in effect.

“ ASTM ” means ASTM International, formerly known as the American Society for Testing and Materials.

“ Avon Terminal ” means the marine berth and other property in Contra Costa County, California, covered by that certain General Lease-Industrial Use, dated January 1, 2015 between TRMC and the State of California, acting through the California State Lands Commission.

“ Barrel ” means a volume equal to 42 U.S. gallons of 231 cubic inches each, at 60 degrees Fahrenheit under one atmosphere of pressure.

“ Business Day ” means a day, other than a Saturday or Sunday, on which banks in New York, New York are open for the general transaction of business.

“ Capacity Resolution ” has the meaning set forth in Section 7(b) .

“ Commencement Date ” has the meaning set forth in Section 3 .

“ Commitment ” has the meaning set forth in Section 2(a) .

“ Confidential Information ” means all confidential, proprietary or non-public information of a Party, whether set forth in writing, orally or in any other manner, including all non-public information and material of such Party (and of companies with which such Party has entered into confidentiality agreements) that another Party obtains knowledge of or access to, including non-public information regarding products, processes, business strategies and plans, customer lists, research and development programs, computer programs, hardware configuration information, technical drawings, algorithms, know-how, formulas, processes, ideas, inventions (whether patentable or not), trade secrets, schematics and other technical, business, marketing and product development plans, revenues, expenses, earnings projections, forecasts, strategies, and other non-public business, technological, and financial information.

“ Contribution Agreement ” has the meaning set forth in the Recitals.

“ Control ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract, or otherwise.

“ Extension Period ” has the meaning set forth in Section 4 .

“ First Offer Period ” has the meaning set forth in Section 22(b) .

“ Force Majeure ” means events or circumstances, whether foreseeable or not, which are not reasonably within the control of TLO and which, by the exercise of due diligence, TLO is unable to prevent or overcome, that prevent performance of TLO’s obligations or limit TRMC’s ability to make effective use of the Operating Capacity of the Tanks, including: acts of God, strikes, lockouts or other industrial disturbances, wars, riots, fires, floods, storms, orders of Governmental Authorities, explosions, terrorist acts, breakage, accident to machinery, equipment, storage tanks or lines of pipe, and inability to obtain or unavoidable delays in obtaining material or equipment and similar events, excluding circumstances due to market conditions.

“ Force Majeure Notice ” has the meaning set forth in Section 23(a) .

“ Force Majeure Period ” has the meaning set forth in Section 23(a) .

“ General Partner ” has the meaning set forth in the Preamble.

“ Governmental Authority ” means any federal, state, local or foreign government or any provincial, departmental or other political subdivision thereof, or any entity, body or authority exercising executive, legislative, judicial, regulatory, administrative or other governmental functions or any court, department, commission, board, bureau, agency, instrumentality or administrative body of any of the foregoing.

“ Month ” means the period commencing on the Commencement Date and ending on the last day of the calendar month in which service begins and each successive calendar month thereafter.

“ Omnibus Agreement ” means that certain Third Amended and Restated Omnibus Agreement, dated as of July 1, 2014, by and among Tesoro, TRMC, Tesoro Companies, Inc., Tesoro Alaska Company LLC, the General Partner and the Partnership, as such agreement (and the schedules thereto) may be amended, supplemented or restated from time to time.

“ Operating Capacity ” means the effective storage capacity of a Tank, taking into account accepted engineering principles, industry standards, American Petroleum Institute guidelines and Applicable Laws, only as to Products that such Tank is capable of storing, within the requirements of applicable permit requirements and under actual conditions as they may exist at any time.

“ Operated Tanks ” shall mean Tanks 258, 517 and 943 listed on Schedule B attached hereto, which are outside the Storage Facility and are owned by TRMC, but which shall be operated by TLO and used to provide services hereunder.

“ Owned Tanks ” mean the tanks owned by TLO and listed on Schedule B attached hereto, each of which is used for the storage of Products and located at the Storage Facility.

“ Operating Procedures ” has the meaning set forth in Section 15(a) .

“ Partnership ” has the meaning set forth in the Preamble.

“ Partnership Change of Control ” means Tesoro ceases to Control the General Partner.

“ Partnership Group ” has the meaning set forth in Section 20(b) .

“ Party ” or “ Parties ” means that each of TRMC and TLO is a “Party” and collectively are the “Parties” to this Agreement.

“ Person ” means any individual, partnership, limited partnership, joint venture, corporation, limited liability company, limited liability partnership, trust, unincorporated organization or Governmental Authority or any department or agency thereof.

“ Pipeline ” or “ Pipelines ” means those pipelines within the Storage Facility that connect the Tanks to one another and to the receiving and delivery flanges of the Storage Facility.

“ Product ” or “ Products ” means crude oil, refinery feedstocks, refined products, and other materials stored in the Tanks in the ordinary course of business.

“ Receiving Party Personnel ” has the meaning set forth in Section 29(d) .

“ Refinery ” means TRMC’s refining facility near Martinez in Contra Costa County, California.

“ Replacement Customer ” has the meaning set forth in Section 25(c) .

“ Restoration ” has the meaning set forth in Section 7(a) .

“ Right of First Refusal ” has the meaning set forth in Section 22(b) .

“ Secondment Agreement ” shall mean the Secondment and Logistics Services Agreement dated as of July 1, 2014, as amended, and related service orders.

“ Shell Capacity ” means the gross storage capacity of a Tank, based upon its dimensions, as set forth for each Tank on Schedule B attached hereto and in applicable Terminal Service Orders.

“ Storage Facility ” has the meaning set forth in the Recitals.

“ Storage Services Fee ” has the meaning set forth in Section 5(a) .

“ Surcharge ” has the meaning set forth in Section 8(b)(i) .

“ Tank Heels ” consist of the minimum quantity of Product which either (a) must remain in a Tank during all periods when the Tank is available for service to keep the Tank in regulatory compliance or (b) is necessary for physical operation of the Tank.

“ Tanks ” means the Owned Tanks and the Operated Tanks.

“ Term ” and “ Initial Term ” each have the meaning set forth in Section 4 .

“ Terminal Service Order ” has the meaning set forth in Section 6(a) .

“ Termination Notice ” has the meaning set forth in Section 23(a) .

“ Tesoro ” has the meaning set forth in the Recitals.

“ TLO ” has the meaning set forth in the Preamble.

“ TRMC ” has the meaning set forth in the Preamble.

“ TRMC Group ” has the meaning set forth in Section 20(a) .

“ TRMC Termination Notice ” has the meaning set forth in Section 23(b) .

2. STORAGE COMMITMENT

(a) Commitment . During the Term of this Agreement and subject to the terms and conditions of this Agreement and the effective Operating Capacity of each Tank and the Storage Facility as a whole, TLO shall, as applicable, store all Products tendered by TRMC at the Storage Facility or in the Operated Tanks (the “ Commitment ”).

(b) Dedicated Storage . The Tanks shall be dedicated and used exclusively for the storage of TRMC’s Products or Products of Replacement Customers. TRMC shall be responsible for maintaining all Tank Heels required for operation of the Tanks. Tank Heels cannot be withdrawn from any Tank without prior approval of TLO.

3. COMMENCEMENT DATE

The “ Commencement Date ” will be November 21, 2016.

4. TERM

The initial term of this Agreement shall commence on the Commencement Date and shall continue through November 21, 2026 (the “ Initial Term ”); provided , however , that TRMC may, at its option, extend the Initial Term for up to two (2) renewal terms of five (5) years each (each, an “ Extension Period ”) by providing written notice of its intent to TLO no less than twenty-four (24) calendar months prior to the end of the Initial Term or the then-current Extension Period. The Initial Term and any Extension Period shall be referred to herein as the “ Term .” Without limitation on the provisions of Section 22 , upon expiration of the Term the parties shall meet and use good faith efforts to reach agreement (without any obligation on the part of either party to reach such agreement) regarding a new agreement for storage services at the Storage Facility.

5. STORAGE SERVICES FEE

(a) Storage Services Fee . TRMC shall pay a Monthly fee (the “ Storage Services Fee ”) to reserve, on a firm basis, all of the existing aggregate Shell Capacity of all of the Tanks. Such fee shall include all storage, pumping, blending and trans-shipment between and among the Tanks, the Refinery and third parties, but shall not include fees for delivery across the Avon Terminal. Such fee shall be payable by TRMC on a Monthly basis throughout the Term of the Agreement, regardless of the actual volumes of Products stored by TLO on behalf of TRMC; provided , however , that the Parties shall from time to time negotiate an appropriate adjustment to such fee if the following conditions are met: (i) TRMC requires the full Operating Capacity of the Tanks, (ii) the full Operating Capacity of the Tanks is not available to TRMC for any reason (other than any reason resulting from or relating to actions or inactions by TRMC), and (iii) TLO is unable to otherwise accommodate the actual volumes of Products required to be stored by TRMC pursuant to the terms of this Agreement. Unless otherwise agreed, such adjustment shall be made in proportion to the reduction in Operating Capacity for any time period compared with the Operating Capacity then in effect for the affected Tank or Tanks pursuant to the mutually agreed Terminal Service Orders. (For example, if the Storage Services Fee applicable to the Shell Capacity of the affected Tank is $0.80 per Barrel per Month x 345,000 Barrels = $276,000, and if the Operating Capacity in the then-applicable Terminal Service Order is 301,000 Barrels, and if the Operating Capacity falls 10% to 270,900, then TRMC’s Storage Services Fee for the affected Tank during the period in which the full Operating Capacity of such Tank is not available to TRMC for any reason (other than any reason resulting from or relating to actions or inactions by TRMC) would be reduced by 10% to $248,400.) Prior to the calculation of a reduced Storage Services Fee in the manner set forth above, there shall have been at least a consecutive twenty-four (24) hour interruption in service. The Parties recognize that the existing Operating Capacity of certain Tanks may be less than the Shell Capacity of such Tanks, but the Parties acknowledge and agree that the Storage Services Fee shall be set in terms of a dollar-per-Barrel per Month rate based on Shell Capacity in the applicable Terminal Service Order.

(b) Rate and Fee . The Storage Services Fee shall be calculated using the per Barrel rate set forth on the Terminal Service Orders executed effective as of the Commencement Date for the then-existing aggregate Shell Capacity of all of the Tanks. The Storage Services Fee owed during the Month in which the Commencement Date occurs, if less than a full calendar month, shall be prorated in accordance with the ratio of (i) the number of days in such Month during which this Agreement is effective to (ii) the total number of days in such Month.

6. TERMINAL SERVICE ORDERS

(a) Description . TLO and TRMC shall enter into the Terminal Service Orders referred to in Section 5(b) and may enter into additional terminal service orders substantially in the form attached hereto as Schedule A (each, a “ Terminal Service Order ”). Upon a request by TRMC pursuant to this Agreement or as deemed necessary or appropriate by TLO in connection with the services to be delivered pursuant hereto, TLO shall generate a Terminal Service Order to set forth the specific terms and conditions for providing the applicable services described therein and the applicable fees to be charged for such services. No Terminal Service Order shall be effective until fully executed by both TLO and TRMC.

(b) Included Items . Items available for inclusion on a Terminal Service Order include, but are not limited to, the following:

(i) the Shell Capacity of each Tank;

(ii) the Storage Services Fee pursuant to Section 5 ;

(iii) any reimbursement pursuant to Section 8(a) ;

(iv) any Surcharge pursuant to Section 8(b) ;

(v) any modification, cleaning, or conversion of a Tank as requested by TRMC pursuant to Section 9(a) ;

(vi) any agreements with respect to the Storage Service Fee during periods of repair or maintenance pursuant to Section 9(b) ;

(vii) any reimbursement related to newly imposed taxes and regulations pursuant to Section 10 ; and

(viii) any other services that may be agreed upon by the Parties pursuant to Section 16 .

(c) Fee Increases . Any fees of a fixed amount set forth in this Agreement and any Terminal Service Order shall be increased on July 1 of each year of the Term, commencing on July 1, 2017, by a percentage equal to the greater of zero or the positive change, if any, in the CPI-U (All Urban Consumers) for the prior calendar year, as reported by the Bureau of Labor Statistics, and rounded to the nearest one-tenth (1/10) of one percent (1%).

(d) Conflicts . In case of any conflict between the terms of this Agreement and the terms of any Terminal Service Order, the terms of the applicable Terminal Service Order shall govern.

7. CAPABILITIES OF FACILITIES

(a) Maintenance and Repair . Subject to Force Majeure and interruptions for routine repair and maintenance, consistent with customary terminal industry standards, TLO shall maintain each Tank and the Pipelines in a condition and with a capacity sufficient to store and handle a volume of TRMC’s Products at least equal to the current Operating Capacity for the Storage Facility. TLO’s obligations may be temporarily suspended during the occurrence of, and for the entire duration of, a Force Majeure or other interruption of service, to the extent such Force Majeure or other interruption of service impairs TLO’s ability to perform such obligations. If for any reason, including, without limitation, a Force Majeure event, the condition of

any Tanks and/or associated Pipelines is below the level necessary for TLO to store and handle a volume of TRMC’s Products at least equal to the current Operating Capacity for such Tank and/or associated Pipeline, then within a reasonable period of time thereafter, TLO shall make repairs to restore the capacity of such Tank and/or associated Pipeline(s) to ensure service at the current Operating Capacity (“ Restoration ”). Except as provided below in Section 7(b) , all of such Restoration of such Tanks and/or associated Pipeline shall be at TLO’s cost and expense unless the damage creating the need for such repairs was caused by the negligence or willful misconduct of TRMC, its employees, agents or customers. (If TRMC directly incurs any such costs and expenses for which TLO is responsible with regard to the Operated Tanks, TLO shall reimburse TRMC for such costs and expenses.) Notwithstanding the foregoing, TLO shall schedule maintenance to minimize the opportunity cost and disruption to TRMC’s business and shall minimize the number of Tanks taken out of service during any such scheduled maintenance. Prior to January 1 of each year of the Term of this Agreement, the Parties shall mutually agree upon the maintenance plan and schedule for the Tanks for the following calendar year (e.g., prior to January 1, 2018, the Parties shall mutually agree on such plan and schedule for 2019).

(b) Capacity Resolution . In the event of the failure of TLO to maintain any Pipeline or Tank in a condition and with a capacity sufficient to store and handle a volume of TRMC’s Products equal to its current Operating Capacity, then either Party shall have the right to call a meeting between executives of both Parties by providing at least two (2) Business Days’ advance written notice. Any such meeting shall be held at a mutually agreeable location and will be attended by executives of both Parties each having sufficient authority to commit his or her respective Party to a Capacity Resolution (as defined below). At the meeting, the Parties will negotiate in good faith with the objective of reaching a joint resolution for the Restoration of capacity of the Tank and/or its associated Pipeline(s) which will, among other things, specify steps to be taken by TLO to fully accomplish Restoration and the deadlines by which the Restoration must be completed (the “ Capacity Resolution ”). Without limiting the generality of the foregoing, the Capacity Resolution shall set forth an agreed upon time schedule for the Restoration activities. Such time schedule shall be reasonable under the circumstances, consistent with customary terminal industry standards and shall take into consideration TLO’s economic considerations relating to costs of the repairs and TRMC’s requirements concerning its refining and marketing operations. TLO shall use commercially reasonable efforts to continue to provide storage of TRMC’s Products, to the extent capacity is available, during the period before Restoration is completed. In the event that TRMC’s economic considerations justify incurring additional costs to restore the Tank and/or associated Pipeline(s) in a more expedited manner than the time schedule determined in accordance with the preceding sentences, TRMC may require TLO to expedite the Restoration to the extent reasonably possible, subject to TRMC’s payment upon the occurrence of mutually agreed upon milestones in the Restoration process. In the event that the Operating Capacity of a Tank is reduced, and the Parties agree that the Restoration of such Tank to its full Operating Capacity is not justified under the standards set forth in the preceding sentences, then the Parties shall negotiate an appropriate adjustment to the Storage Services Fee to account for the reduced Operating Capacity available for TRMC’s use. In the event the Parties agree to an expedited Restoration plan in which TRMC agrees to pay the Restoration costs based on milestone payments or if the Parties agree to a reduced Storage Services Fee, then neither Party shall have the right to terminate this Agreement or any applicable Terminal Service Order pursuant to Section 23 below, so long as any such Restoration is completed with due diligence.

(c) TRMC’s Right To Cure . If at any time after the occurrence of (x) a Partnership Change of Control or (y) a sale of the Refinery, TLO either (i) refuses or fails to meet with TRMC within the period set forth in Section 7(b) , (ii) fails to agree to perform a Capacity Resolution in accordance with the standards set forth in Section 7(b) , or (iii) fails to perform its obligations in compliance with the terms of a Capacity Resolution, TRMC may, as its sole remedy for any breach by TLO of any of its obligations under Section 7(b) , require TLO to complete a Restoration of the affected Pipeline or Tank, and the Storage Services Fee shall be reduced, as described in Section 7(b) above, to account for the reduced Operating Capacity available

for TRMC’s use until such Restoration is completed. Any such Restoration required under this Section 7(c) shall be completed by TLO at TRMC’s cost. TLO shall use commercially reasonable efforts to continue to provide storage and throughput of TRMC’s Products at the affected Tank or Pipeline while such Restoration is being completed. Any work performed by TLO pursuant to this Section 7(c) shall be performed and completed in a good and workmanlike manner consistent with applicable pipeline industry standards and in accordance with Applicable Law. Additionally, during such period after the occurrence of (x) a Partnership Change of Control or (y) a sale of the Refinery, TRMC may exercise any remedies available to it under this Agreement or any Terminal Service Order (other than termination), including the right to immediately seek temporary and permanent injunctive relief for specific performance by TLO of the applicable provisions of this Agreement or any Terminal Service Order, including, without limitation, the obligation to make Restorations as described herein.

(d) Existing Contractors . TLO may continue to utilize labor, equipment, materials and supplies provided by contractors under their existing service agreements with TRMC to perform work to be performed by TLO hereunder, without the requirement that such existing contracts be amended, assigned or replaced. Such contracts with TRMC may continue to cover the work to be provided by TLO hereunder, as provided under Section 4(a) of the Secondment Agreement, and TLO shall be responsible for the costs and expenses of such work performed by such contractors pursuant to those provisions of the Secondment Agreement.

8. REIMBURSEMENT; SURCHARGES

(a) Reimbursement . TRMC shall reimburse TLO for all of the following: (i) the actual cost of any expenditures that TLO agrees to make upon TRMC’s request, and (ii) any cleaning, degassing or other preparation of the Tanks at the expiration of this Agreement. The means of paying such reimbursement for item (i) above shall be set forth in a Terminal Service Order, and may include direct reimbursement, either before or after TLO incurs such expenditures or an additional ongoing fee to reimburse TLO for its expenditures.

(b) Surcharges .

(i) If, during the Term, any existing laws or regulations are changed or any new laws or regulations are enacted that require TLO to make substantial and unanticipated expenditures (whether capitalized or otherwise) with respect to the Storage Facility, Operated Tanks or the services provided hereunder, TLO may, subject to the terms of this Section 8(b) impose a surcharge to increase the applicable service fee (a “ Surcharge ”) to cover TRMC’s pro rata share of the cost of complying with these laws or regulations, based upon the percentage of TRMC’s use of the services or facilities impacted by such new laws or regulations.

(ii) TLO shall notify TRMC of any proposed Surcharge to be imposed pursuant to Section 8(b)(i) sufficient to cover the cost of any required capital projects for the Storage Facility or Operated Tanks and any ongoing increased operating costs. TLO and TRMC then shall negotiate in good faith for up to thirty (30) days to mutually determine the effect of the change in law or regulation or new law or regulation, the cost thereof, and how such cost shall be amortized at an interest rate of no more than LIBOR plus six percent (LIBOR + 6%) as a Surcharge, with the understanding that TLO and TRMC shall use their reasonable commercial efforts to mitigate the impact of, and comply with, these laws and regulations. Without limiting the foregoing, if expenditures requiring a Surcharge may be avoided or reduced through changes in operations, then the Parties shall negotiate in good faith to set forth the appropriate changes to Operating Capacities or other performance standards set forth in a Terminal Service Order to evidence the reduction of

the amount of a Surcharge while leaving the Parties in the same relative economic position they held before the laws or regulations were changed or enacted.

(iii) In the event any Surcharge results in less than a fifteen percent (15%) increase in the applicable service fee, TRMC will be assessed such Surcharge on all future invoices during the period in which such Surcharge is in effect for the applicable amortization period, and TLO shall not terminate the affected service from this Agreement.

(iv) In the event any Surcharge results in a fifteen percent (15%) or more increase in the applicable service fee, TLO shall notify TRMC of the amount of the Monthly Surcharge required to reimburse TLO for its costs, plus carrying costs, together with reasonable supporting detail for the nature and amount of any such Surcharge.

(A) If within thirty (30) days of such notification provided in Section 8(b)(iv) , TRMC does not agree to pay such Surcharge or to reimburse TLO up front for its costs, TLO may elect to either:

(1) require TRMC to pay such Surcharge, up to a fifteen percent (15%) increase in the applicable service fee; or

(2) terminate the Tank(s) or other facilities from this Agreement upon notice to TRMC.

(B) TLO’s performance obligations under this Agreement shall be suspended or reduced during the above thirty (30)-day period to the extent that TLO would be obligated to make such expenditures to continue performance during such period.

(v) Following a resolution with respect to the amount and manner of payment of a Surcharge pursuant to this Section 8 , the Parties shall execute an appropriate Terminal Service Order memorializing the terms of such resolution.

(vi) In lieu of paying the Surcharge in connection with any required capital project, TRMC may, at its option, elect to pay the full cost of the substantial and unanticipated expenditures upon completion of a project.

9. TANK MODIFICATION, REPAIR AND CLEANING; REMOVAL OF PRODUCT

(a) Tank Modifications . Each of the Tanks shall be used for its historical service, provided , however , that TRMC may request that a Tank be changed for storage of a different grade or type of Product. In such an instance, TLO shall change such service, if the same can be accomplished in accordance with reasonable commercial standards, accepted industry and engineering guidelines, permit requirements and Applicable Law. If any such modifications, improvements, vapor recovery, cleaning, degassing, or other preparation of the tanks is performed by TLO at the request of TRMC, TRMC shall bear all direct costs attributable thereto, including, without limitation, the cost of removal, processing, transportation, and disposal of all waste and the cost of any taxes or mutually agreed charges TLO may be required to pay in regard to such waste (subject to subparagraph (c) below), which costs shall be set forth on the applicable Terminal Service Order. TLO may require TRMC to pay all such amounts prior to commencement of any remodeling work on the Tanks, or by mutual agreement, the Parties may agree upon an increase in the Storage Services Fee to reimburse TLO for its costs of such modifications, plus a reasonable return on capital. All of such costs associated with Tank modifications shall be documented by a Terminal Service Order to be

executed by the Parties.

(b) Responsibility for Fees . Should TLO take any of the Tanks out of service for regulatory requirements, repair, or maintenance, TRMC shall be solely responsible for any alternative storage or Product movements as required and all third-party fees associated with such movements that are not within the Storage Facility; provided that TLO shall not be reimbursed for any costs of transportation through TLO’s facilities at the Refinery, other than through the Avon Terminal, that it might be entitled to collect under any tariff or agreement with TRMC. Unless a Tank is removed specifically at TRMC’s request, or as otherwise agreed pursuant to a Terminal Service Order, TRMC shall not be responsible to TLO for any Storage Services Fees for any Tanks taken out of service during the period that such Tank is out of service.

(c) Removal of Product . Materials stored in or removed from the Storage Facility shall at all times remain owned by TRMC or any applicable Replacement Customer, and the owner of the Product shall always remain responsible for, at the owner’s sole cost, receiving custody of all of its materials to be removed from the Storage Facility, making appropriate arrangements to receive custody at the Storage Facility in a manner acceptable to TLO, and disposal of such material after custody is returned to the owner. TRMC shall be responsible for any fees and costs associated with the disposal of hazardous waste (unless caused by TLO’s negligence). TLO shall have no obligations regarding disposition of such materials, other than to return custody to the owner at the Storage Facility.

10. NEWLY IMPOSED TAXES AND REGULATIONS

TRMC shall promptly reimburse TLO for any newly imposed taxes, levies, royalties, assessments, licenses, fees, charges, surcharges and sums due of any nature whatsoever (other than income taxes, gross receipt taxes and similar taxes) by any federal, state or local government or agency that TLO incurs on TRMC’s behalf for the services provided by TLO under this Agreement or any applicable Terminal Service Order. If TLO is required to pay any of the foregoing, TRMC shall promptly reimburse TLO in accordance with the payment terms set forth in this Agreement. Any such newly imposed taxes shall be specified in an applicable Terminal Service Order.

11. PAYMENTS

TLO shall invoice TRMC on a Monthly basis, and TRMC shall pay all amounts due under this Agreement and any Terminal Service Order no later than ten (10) days after TRMC’s receipt of TLO’s invoice. Any past due payments owed by TRMC shall accrue interest, payable on demand, at the lesser of (i) the rate of interest announced publicly by JPMorgan Chase Bank, in New York, New York, as JPMorgan Chase Bank’s prime rate (which Parties acknowledge and agree is announced by such bank and used by the Parties for reference purposes only and may not represent the lowest or best rate available to any of the customers of such bank or the Parties), plus four percent (4%), and (ii) the highest rate of interest (if any) permitted by Applicable Law, from the due date of the payment through the actual date of payment.

12. SCHEDULING

All scheduling of delivery into and redelivery out of the Tanks shall be decided by mutual agreement of the Parties. TRMC shall identify to TLO prior to the delivery of any Product to the Storage Facility, or the specific Tanks to be used for receiving and storing such Product.

13. SERVICES; VOLUME LOSSES; MEASUREMENT

(a) Services . The services provided by TLO pursuant to this Agreement or any applicable Terminal Service Order shall consist of storage, pumping, blending and trans-shipment of the Products at or through the Tanks.

(b) Measurement and Volume Loss Control Practices .

(i) TLO shall have no obligation to measure volume gains and losses.

(ii) TLO shall be responsible to TRMC only for Product losses and/or shortages resulting from the negligent or wrongful acts and omissions of TLO; provided that TLO shall not be responsible to TRMC for any Product losses and/or shortages for which TRMC is compensated by its cargo/inventory insurance carrier, including through the cargo/inventory insurance coverage required by Section 27 . If TRMC fails to maintain the cargo/inventory insurance coverage required by Section 27 , then TLO shall also not be responsible to TRMC for any Product losses and/or shortages to the extent TRMC would have been compensated by its insurance carrier had TRMC maintained the cargo/inventory insurance coverage required by Section 27 .

(iii) TRMC shall be responsible for all Product losses and/or shortages it may suffer other than those covered by Section 13(b)(ii) .

(c) Storage Tank Measurement . Storage Tank gauging shall be performed by TLO’s personnel. TRMC may perform joint gauging at its sole expense with TLO’s personnel at the time of delivery or receipt of Product, to verify the amount involved. If TRMC requests an independent gauger, such gauger must be acceptable to TLO and such gauging shall be at TRMC’s sole expense.

14. CUSTODY TRANSFER AND TITLE

TLO shall be deemed to have custody of the Product after it enters TLO’s fixed receiving flange and until the Product leaves the fixed delivery flange on the receiving manifold at the Storage Facility. TRMC shall be deemed to receive custody of the Product when it enters the delivery flange into the applicable pipeline which delivers Product into the Refinery. Upon re-delivery of any Product to TRMC’s account, TRMC shall become solely responsible for any loss, damage or injury to Person or property or the environment, arising out of transportation, possession or use of such Product after transfer of custody . Title to all TRMC’s Products received in the Storage Facility shall remain with TRMC at all times. Both Parties acknowledge that this Agreement and any Terminal Service Order represent a bailment of Products by TRMC to TLO and not a consignment of Products, it being understood that TLO has no authority hereunder to sell or seek purchasers for the Products of TRMC. TRMC hereby warrants that it shall have good title to and the right to deliver, store and receive Products pursuant to the terms of this Agreement or any applicable Terminal Service Order. TRMC acknowledges that, notwithstanding anything to the contrary contained in this Agreement or in any Terminal Service Order, TRMC acquires no right, title or interest in or to the Storage Facility, except the right to receive, deliver and store the Products in the Tanks. TLO shall retain control of the Storage Facility.

15. OPERATING PROCEDURES; SERVICE INTERRUPTIONS

(a) Operating Procedures for TRMC . TRMC hereby agrees to strictly abide by any and all procedures (the “ Operating Procedures ”) relating to the operation and use of the Storage Facility (including the Tanks) and the Pipelines that generally apply to receipt, delivery, storage, and movement of Products at the Storage Facility. TLO shall provide TRMC with a current copy of its Operating Procedures and shall provide TRMC with thirty (30) days’ prior written notice of any changes to the Operating Procedures, unless a shorter implementation of such revised Operating Procedures is required by Applicable Law or emergency conditions. TRMC shall have the right to approve any material revisions to the Operating Procedures, which shall not be unreasonably withheld, prior to their becoming effective, unless otherwise required under Applicable Law or emergency conditions, and the material revisions shall be reflected in a Terminal Service Order between the Parties.

(b) Operating Procedures for TLO . TLO shall carry out the handling of the Products at the Storage Facility, the Tanks, and the Pipelines in accordance with the Operating Procedures.

(c) Service Interruptions . TLO shall use reasonable commercial efforts to minimize the interruption of service at each Tank and/or any of the associated Pipeline(s). TLO shall promptly inform TRMC’s operational personnel of any anticipated partial or complete interruption of service at any Tank and/or associated Pipelines, including relevant information about the nature, extent, cause and expected duration of the interruption and the actions TLO is taking to resume full operations; provided that TLO shall not have any liability for any failure to notify, or delay in notifying, TRMC of any such matters except to the extent TRMC has been materially prejudiced or damaged by such failure or delay.

(d) Additional Storage Facilities for Maintenance of the Tanks and Pipelines : In connection with TLO’s maintenance and operation of each Tank and/or any of the associated Pipeline(s), TRMC shall grant TLO reasonable commercial use of additional designated sites at the Refinery as may be required for (i) storage of spare parts, pipes, pumps and other equipment; (ii) a laydown yard for construction activities in the event of any major repair or replacement of a Tank; or (iii) any additional commercially reasonable storage requirement. Notwithstanding the foregoing, TRMC shall retain the right to designate where and when any sites can be used by TLO for such additional storage facilities and TLO’s use of such sites shall not interfere with TRMC’s normal operation of the Refinery.

16. OTHER SERVICES AND USE OF FACILITIES

To facilitate the operation of the Storage Facility, the Parties shall enter into Terminal Service Orders that set forth the applicable terms and fees associated with TLO’s (a) provision of ancillary services related to storage, handling, blending or other services; and (b) use of sites, facilities and utilities at the Refinery related to operation, maintenance and repair of the Storage Facility.

17. LIENS

TLO hereby waives, relinquishes and releases any and all liens, including without limitation, any and all warehouseman’s liens, custodian’s liens, rights of retention and/or similar rights under all applicable laws, which TLO would or might otherwise have under or with respect to all Products stored or handled hereunder. TLO further agrees to furnish documents reasonably acceptable to TRMC and its lender(s) (if applicable), and to cooperate with TRMC in assuring and demonstrating that Product titled in TRMC’s name shall not be subject to any lien on the Storage Facility or TLO’s Product stored there.

18. COMPLIANCE WITH LAW AND GOVERNMENT REGULATIONS

(a) Compliance With Law . None of the Products covered by this Agreement or any Terminal Service Order shall be derived from any Product which was produced or withdrawn from storage in violation of any federal, state or other governmental law, nor in violation of any rule, regulation or promulgated by any governmental agency having jurisdiction.

(b) Licenses and Permits . TRMC shall maintain all necessary licenses and permits for the storage of Products at the Storage Facility, unless otherwise agreed to by the Parties.

(c) Applicable Law . The Parties are entering into this Agreement and any Terminal Service Order in reliance upon and shall fully comply with all Applicable Law which directly or indirectly affects the Products hereunder, or any receipt, throughput delivery, transportation, handling or storage of Products hereunder or the ownership, operation or condition of the Storage Facility. Each Party shall be responsible for compliance with all Applicable Laws associated with such Party’s respective performance hereunder and the operation of such Party’s facilities. In the event any action or obligation imposed upon a Party under this Agreement and any Terminal Service Order shall at any time be in conflict with any requirement of Applicable Law, then this Agreement and any Terminal Service Order, shall immediately be modified to conform the action or obligation so adversely affected to the requirements of the Applicable Law, and all other provisions of this Agreement and any Terminal Service Order shall remain effective.

(d) New Or Changed Applicable Law . If during the Term, any new Applicable Law becomes effective or any existing Applicable Law or its interpretation is materially changed, which change is not addressed by another provision of this Agreement or any Terminal Service Order and which has a material adverse economic impact upon a Party, then either Party, acting in good faith, shall have the option to request renegotiation of the relevant provisions of this Agreement or any Terminal Service Order with respect to future performance. The Parties shall then meet and negotiate in good faith amendments to this Agreement or to an applicable Terminal Service Order that will conform to the new Applicable Law while preserving the Parties’ economic, operational, commercial and competitive arrangements in accordance with the understandings set forth herein.

19. LIMITATION ON LIABILITY; WARRANTIES

(a) No Special Damages . IN NO EVENT SHALL A PARTY BE LIABLE TO THE OTHER PARTY FOR ANY LOST PROFITS OR INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, NO MATTER HOW CHARACTERIZED, RELATING TO THIS AGREEMENT AND ARISING FROM ANY CAUSE WHATSOEVER, EXCEPT WITH RESPECT TO INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES ACTUALLY AWARDED TO A THIRD PARTY OR ASSESSED BY A GOVERNMENTAL AUTHORITY AND FOR WHICH A PARTY IS PROPERLY ENTITLED TO INDEMNIFICATION FROM THE OTHER PARTY PURSUANT TO THE EXPRESS PROVISIONS OF THIS AGREEMENT.

(b) Claims and Liability for Lost Product . TLO shall not be liable to TRMC for lost or damaged Product unless TRMC notifies TLO in writing within ninety (90) days of the report of any incident or the date TRMC learns of any such loss or damage to the Product. TLO’s maximum liability to TRMC for any lost or damaged Product shall be limited to (i) the lesser of (1) the replacement value of the Product at the time of the incident based upon the price as posted by Platts or similar publication for similar Product in the same locality, and if no other similar Product is in the locality, then in the state, or (2) the actual cost paid

for the Product by TRMC (copies of TRMC’s invoices of cost paid must be provided), less (ii) the salvage value, if any, of the damaged Product.

(c) No Guarantees or Warranties. Except as expressly provided in the Agreement, neither TRMC nor TLO makes any guarantees or warranties of any kind, expressed or implied. TLO specifically disclaims all implied warranties of any kind or nature, including any implied warranty of merchantability and/or any implied warranty of fitness for a particular purpose.

20. INDEMNIFICATION

(a) TLO Indemnities . Notwithstanding anything else contained in this Agreement or any Terminal Service Order, TLO shall release, defend, protect, indemnify, and hold harmless TRMC, its carriers, and each of its and their respective affiliates, officers, directors, employees, agents, contractors, successors, and assigns (excluding any member of the Partnership Group) (collectively the “ TRMC Group ”), from and against any and all demands, claims (including third-party claims), losses, costs, suits, or causes of action (including, but not limited to, any judgments, losses, liabilities, fines, penalties, expenses, interest, reasonable legal fees, costs of suit, and damages, whether in law or equity and whether in contract, tort, or otherwise) for or relating to (i) personal or bodily injury to, or death of the employees of TRMC, TLO or the General Partner, and, as applicable, their carriers, customers, representatives, and agents, (ii) loss of or damage to any property, products, material, and/or equipment belonging to TRMC, TLO and, as applicable, their carriers, customers, representatives, and agents, and each of their respective affiliates, contractors, and subcontractors (except for those volume losses of Products provided for herein), (iii) loss of or damage to any other property, products, material, and/or equipment of any other description (except for those volume losses of Products provided for herein), and/or personal or bodily injury to, or death of any other Person or Persons; and with respect to clauses (i) through (iii) above, which is caused by or resulting in whole or in part from the negligent or wrongful acts or omissions of TLO or the General Partner in connection with the ownership or operation of the Pipelines or the Storage Facility and the services provided hereunder, and, as applicable, their carriers, customers (other than TRMC), representatives, and agents, or those of their respective employees with respect to such matters, and (iv) any losses incurred by TRMC due to violations of this Agreement or any Terminal Service Order by TLO, or, as applicable, its customers (other than TRMC), representatives, and agents; PROVIDED THAT TLO SHALL NOT BE OBLIGATED TO RELEASE, INDEMNIFY OR HOLD HARMLESS TRMC OR ANY MEMBER OF THE TRMC GROUP FROM AND AGAINST ANY CLAIMS TO THE EXTENT THEY RESULT FROM THE BREACH OF CONTRACT, STRICT LIABILITY OR THE NEGLIGENT ACTS, ERRORS, OMISSIONS OR WILLFUL MISCONDUCT OF TRMC OR ANY MEMBER OF THE TRMC GROUP.

(b) TRMC Indemnities . Notwithstanding anything else contained in this Agreement or any Terminal Service Order, TRMC shall release, defend, protect, indemnify, and hold harmless TLO, General Partner, the Partnership, their subsidiaries and their respective officers, directors, members, managers, employees, agents, contractors, successors, and assigns (collectively the “ Partnership Group ”) from and against any and all demands, claims (including third-party claims), losses, costs, suits, or causes of action (including, but not limited to, any judgments, losses, liabilities, fines, penalties, expenses, interest, reasonable legal fees, costs of suit, and damages, whether in law or equity and whether in contract, tort, or otherwise) for or relating to (i) personal or bodily injury to, or death of the employees of TLO, the General Partner, TRMC, and, as applicable, their carriers, customers, representatives, and agents; (ii) loss of or damage to any property, products, material, and/or equipment belonging to TLO, TRMC, and, as applicable, their carriers, customers, representatives, and agents, and each of their respective affiliates, contractors, and subcontractors (except for those volume losses of Products provided for herein); (iii) loss of or damage to

any other property, products, material, and/or equipment of any other description (except for those volume losses of Products provided for herein), and/or personal or bodily injury to, or death of any other Person or Persons; and with respect to clauses (i) through (iii) above, which is caused by or resulting in whole or in part from the negligent or wrongful acts or omissions of TRMC, in connection with TRMC’s use of the Pipelines or the Storage Facility and the services provided hereunder and TRMC’s Products stored hereunder, and, as applicable, its carriers, customers, representatives, and agents, or those of their respective employees with respect to such matters; and (iv) any losses incurred by TLO due to violations of this Agreement or any Terminal Service Order by TRMC, or, as applicable, its carriers, customers, representatives, and agents; PROVIDED THAT TRMC SHALL NOT BE OBLIGATED TO RELEASE, INDEMNIFY OR HOLD HARMLESS TLO OR ANY MEMBER OF THE PARTNERSHIP GROUP FROM AND AGAINST ANY CLAIMS TO THE EXTENT THEY RESULT FROM THE BREACH OF CONTRACT, STRICT LIABILITY OR THE NEGLIGENT ACTS, ERRORS, OMISSIONS OR WILLFUL MISCONDUCT OF TLO OR ANY MEMBER OF THE PARTNERSHIP GROUP.

(c) Written Claim . Neither Party shall be obligated to indemnify the other Party or be liable to the other Party unless a written claim for indemnity is delivered to the other Party within ninety (90) days after the date that a claim is reported or discovered, whichever is earlier.

(d) No Limitation . Except as expressly provided otherwise in Section 19, the scope of the indemnity provisions set forth in this Section 20 may not be altered, restricted, limited, or changed by any other provision of this Agreement. The indemnity obligations of the Parties as set out in this Section 20 are independent of any insurance requirements as set out in Section 27 , and such indemnity obligations shall not be lessened or extinguished by reason of a Party’s failure to obtain the required insurance coverages or by any defenses asserted by a Party’s insurers.

(e) Survival . These indemnity obligations shall survive the termination of this Agreement until all applicable statutes of limitation have run regarding any claims that could be made with respect to the activities contemplated by this Agreement.

(f) Mutual and Express Acknowledgement . THE INDEMNIFICATION PROVISIONS PROVIDED FOR IN THIS AGREEMENT HAVE BEEN EXPRESSLY NEGOTIATED IN EVERY DETAIL, ARE INTENDED TO BE GIVEN FULL AND LITERAL EFFECT, AND SHALL BE APPLICABLE WHETHER OR NOT THE LIABILITIES, OBLIGATIONS, CLAIMS, JUDGMENTS, LOSSES, COSTS, EXPENSES OR DAMAGES IN QUESTION ARISE OR AROSE SOLELY OR IN PART FROM THE GROSS, ACTIVE, PASSIVE OR CONCURRENT NEGLIGENCE, STRICT LIABILITY, OR OTHER FAULT OF ANY INDEMNIFIED PARTY. EACH PARTY ACKNOWLEDGES THAT THIS STATEMENT COMPLIES WITH THE EXPRESS NEGLIGENCE RULE AND CONSTITUTES CONSPICUOUS NOTICE. NOTICE IN THIS CONSPICUOUS NOTICE IS NOT INTENDED TO PROVIDE OR ALTER THE RIGHTS AND OBLIGATIONS OF THE PARTIES, ALL OF WHICH ARE SPECIFIED ELSEWHERE IN THIS AGREEMENT.

(g) Third-Party Indemnification . If any Party has the rights to indemnification from a third party, the indemnifying party under this Agreement shall have the right of subrogation with respect to any amounts received from such third-party indemnification claim.

21. TERMINATION

(a) Termination for Default . A Party shall be in default under this Agreement or any Terminal Service Order if:

(i) the Party breaches any provision of this Agreement or a Terminal Service Order, which breach has a material adverse effect on the other Party (with such material adverse effect being determined based on this Agreement and all Terminal Service Orders considered as a whole), and such breach is not excused by Force Majeure or cured within fifteen (15) Business Days after notice thereof (which notice shall describe such breach in reasonable detail) is received by such Party (unless such failure is not commercially reasonably capable of being cured in such fifteen (15) Business Day period in which case such Party shall have commenced remedial action to cure such breach and shall continue to diligently and timely pursue the completion of such remedial action after such notice); or

(ii) the Party (A) files a petition or otherwise commences, authorizes or acquiesces in the commencement of a proceeding or cause of action under any bankruptcy, insolvency, reorganization or similar Applicable Law, or has any such petition filed or commenced against it, (B) makes an assignment or any general arrangement for the benefit of creditors, (C) otherwise becomes bankrupt or insolvent (however evidenced) or (D) has a liquidator, administrator, receiver, trustee, conservator or similar official appointed with respect to it or any substantial portion of its property or assets.

If either Party is in default as described above, then (i) if TRMC is in default, TLO may or (ii) if TLO is in default, TRMC may: (A) terminate this Agreement and all applicable Terminal Service Orders upon notice to the defaulting Party; (B) withhold any payments due to the defaulting Party under this Agreement and the Terminal Service Orders; and/or (C) pursue any other remedy at law or in equity.

(b) Obligation to Cure . If a Party breaches any provision of this Agreement or a Terminal Service Order, which breach does not have a material adverse effect on the other Party, the breaching Party shall still have the obligation to cure such breach.

(c) Obligations at Termination . Unless otherwise mutually agreed by the Parties, within thirty (30) days of the termination or expiration of this Agreement, (i) TRMC shall promptly remove all of its removable Products from the Storage Facility and (ii) TLO shall remove the remaining Tank Heels and tank bottoms and deliver them to TRMC or TRMC’s designee. In the event all of the Product is not removed within such thirty (30) day period, TRMC shall be assessed a holdover storage fee, calculated on the same basis as the Storage Services Fee, to all Products held in storage more than thirty (30) days beyond the termination or expiration of this Agreement until such time TRMC’s entire Product is removed from the Tanks and the Storage Facility; provided , however , that TRMC shall not be assessed any storage fees associated with the removal of Product to the extent that TRMC’s ability to remove such Product is delayed or hindered by TLO, its agents, or contractors for any reason.

22. RIGHT TO ENTER INTO A NEW STORAGE AGREEMENT

(a) Right to Enter New Agreement . Within two (2) years of termination of this Agreement for reasons other than (x) a default by TRMC and (y) any other termination of this Agreement initiated by TLO pursuant to Section 21 , TRMC shall have the right to require TLO to enter into a new storage services agreement (with ancillary Terminal Service Orders, as appropriate) with TRMC that (i) is consistent with the terms set forth in this Agreement and Terminal Service Orders in effect at the time of such termination,

(ii) relates to the Storage Facility and the Tanks, and (iii) has commercial terms that are, in the aggregate, equal to or more favorable to TLO than fair market value terms as would be agreed by similarly-situated parties negotiating at arm’s length; provided , however , that TLO shall not be required to enter into any such new storage services agreement with a term that extends beyond November 21, 2036.

(b) New Agreement; Right of First Refusal . In the event that TLO proposes to enter into a storage services agreement with a third party within two (2) years after the termination of this Agreement for reasons other than (x) by default by TRMC and (y) any other termination of this Agreement initiated by TRMC pursuant to Section 21 , TLO shall give TRMC ninety (90) days’ prior written notice of any proposed new storage services agreement with a third party, including (i) details of all of the material terms and conditions thereof and (ii) a thirty (30)-day period (beginning upon TRMC’s receipt of such written notice) (the “ First Offer Period ”) in which TRMC may make a good faith offer to enter into a new storage services agreement with TLO (the “ Right of First Refusal ”). If TRMC makes an offer on terms no less favorable to TLO than the third-party offer with respect to such storage services agreement during the First Offer Period, then TLO shall be obligated to enter into a storage services agreement with TRMC on the terms set forth in TRMC’s offer to TLO. If TRMC does not exercise its Right of First Refusal in the manner set forth above, TLO may, for the next ninety (90) days, proceed with the negotiation of the third-party storage services agreement. If no third party agreement is consummated during such ninety-day period, the terms and conditions of this Section 22(b) shall again become effective.

23. FORCE MAJEURE

(a) Force Majeure Notice . As soon as possible upon the occurrence of a Force Majeure, TLO shall provide TRMC with written notice of the occurrence of such Force Majeure (a “ Force Majeure Notice ”). TLO shall identify in such Force Majeure Notice the approximate length of time that TLO reasonably believes in good faith such Force Majeure shall continue (the “ Force Majeure Period ”). For the duration of the Force Majeure Period, the Storage Services Fee shall be reduced by an amount equal to the Shell Capacity for each affected Tank, provided that if TRMC is able to continue to store Product in a Tank during the Force Majeure Period, but at a reduced Operating Capacity, the Storage Services Fee shall be reduced in proportion to the amount the effective Operating Capacity is reduced. If TLO advises in any Force Majeure Notice that it reasonably believes in good faith that the Force Majeure Period shall continue for more than twelve (12) consecutive Months, then, subject to Section 7 above, at any time after TLO delivers such Force Majeure Notice, either Party may terminate that portion of this Agreement or any Terminal Service Order solely with respect to the affected Tank(s) at the Storage Facility, but only upon delivery to the other Party of a notice (a “ Termination Notice ”) at least twelve (12) Months prior to the expiration of the Force Majeure Period; provided , however ; that such Termination Notice shall be deemed cancelled and of no effect if the Force Majeure Period ends prior to the expiration of such twelve-Month period. For the avoidance of doubt, neither Party may exercise its right under this Section 23(a) to terminate this Agreement or any Terminal Service Order as a result of a Force Majeure with respect to any machinery, storage, tanks, lines of pipe or other equipment that has been unaffected by, or has been restored to working order since, the applicable Force Majeure, including pursuant to a Restoration under Section 7 .

(b) Termination Notice . Notwithstanding the foregoing, if TRMC delivers a Termination Notice to TLO (the “ TRMC Termination Notice ”) and, within thirty (30) days after receiving such TRMC Termination Notice, TLO notifies TRMC that TLO reasonably believes in good faith that it shall be capable of fully performing its obligations under this Agreement or any Terminal Service Order within a reasonable period of time and TRMC mutually agrees, which agreement shall not be unreasonably withheld, then the TRMC Termination Notice shall be deemed revoked and the applicable portion of this Agreement or any

Terminal Service Order shall continue in full force and effect as if such TRMC Termination Notice had never been given.

24. SUSPENSION OF REFINERY OPERATIONS

This Agreement shall continue in full force and effect regardless of whether TRMC decides to permanently or temporarily suspend refining operations at the Refinery. TRMC is not permitted to suspend or reduce its obligations under this Agreement or any Terminal Service Order in connection with a shutdown of the Refinery for scheduled turnarounds or other regular servicing or maintenance. If refining operations at the Refinery are suspended for any reason (including Refinery turnarounds and other scheduled maintenance), then TRMC shall remain liable for Storage Services Fees under this Agreement or any Terminal Service Order for the duration of the suspension. TRMC shall provide at least thirty (30) days’ prior written notice of any suspension of operations at the Refinery due to a planned turnaround or scheduled maintenance.

25. ASSIGNMENT; SUBCONTRACT; PARTNERSHIP CHANGE OF CONTROL

(a) Assignment to TLO . On the Commencement Date, the General Partner shall assign all of its rights and obligations under this Agreement to the Partnership. The Partnership shall immediately assign its rights and obligations hereunder to TLO. Upon such assignment to TLO, TLO shall have all of the respective rights and obligations set forth herein during the Term of this Agreement.

(b) TRMC Assignment to Third Party . TRMC shall not assign any of its rights or obligations under this Agreement without TLO’s prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed; provided , however , that TRMC may assign this Agreement without TLO’s consent in connection with a sale by TRMC of the Refinery so long as the transferee: (i) agrees to assume all of TRMC’s obligations under this Agreement and (ii) is financially and operationally capable of fulfilling the terms of this Agreement, which determination shall be made by TRMC in its reasonable judgment.

(c) Subcontract . Should TRMC desire to subcontract to a third party (“ Replacement Customer ”) any dedicated storage subject to a Terminal Service Order, TRMC must notify TLO in writing prior to the proposed start of the subcontract. TLO has the right to approve any Replacement Customer, which approval shall not be unreasonably withheld, conditioned or delayed. Unless otherwise agreed in writing between TRMC and TLO, and between Replacement Customer and TLO, TRMC will continue to be liable for all terms and conditions of this Agreement related to any subcontracted Tank, including, but not limited to, remittance of any fees set forth in a Terminal Service Order applicable to the subcontracted Tank. TRMC shall be responsible for collection of any fees due to TRMC from the Replacement Customer. TRMC and TLO may mutually agree that operational notices concerning scheduling and similar matters can be directly provided between TLO and any Replacement Customer.

(d) TLO Assignment . TLO shall not assign any of its rights or obligations under this Agreement without TRMC’s prior written consent; provided , however , that TLO shall be permitted to make a collateral assignment of this Agreement solely to secure financing for TLO.

(e) Notification of Assignment . Any assignment that is not undertaken in accordance with the provisions set forth above shall be null and void ab initio . A Party making any assignment shall promptly notify the other Party of such assignment, regardless of whether consent is required. This Agreement shall be binding upon and inure to the benefit of the Parties hereto and their respective successors and permitted assigns.

(f) Partnership Change of Control . TRMC’s obligations hereunder shall not terminate in connection with a Partnership Change of Control, provided , however , that in the case of any Partnership Change of Control; TRMC shall have the option to extend the Term of this Agreement as provided in Section 4 . TLO shall provide TRMC with notice of any Partnership Change of Control at least sixty (60) days prior to the effective date thereof.

26. ACCOUNTING PROVISIONS AND DOCUMENTATION; AUDIT

(a) Storage Services Fee Documentation . Within ten (10) Business Days following the end of each Month, TLO shall furnish TRMC with a statement showing, by Tank, a calculation of all of TRMC’s Monthly Storage Services Fees. TLO shall furnish all appropriate documentation to support the calculation of all fees, and, to the extent reasonably available, to document movement of Products through the Storage Facility.

(b) Access . Each Party and its duly authorized agents and/or representatives shall have reasonable access to the accounting records and other documents maintained by the other Party which relate to this Agreement, and shall have the right to audit such records at any reasonable time or times during the Term and for a period of up to three (3) years after termination of this Agreement. Claims as to shortage in quantity or defects in quality shall be made by written notice within ninety (90) days after the delivery in question or shall be deemed to have been waived.

27. INSURANCE

(a) Coverage . At all times during the Term and for a period of two (2) years after termination of this Agreement for any coverage maintained on a “claims-made” or “occurrence” basis, TRMC shall maintain at its expense the below listed insurance in the amounts specified below, or self-insurance in such amounts as may be agreed pursuant to a Terminal Service Order. Such insurance shall provide coverage to TLO and such policies, other than Worker’s Compensation Insurance, shall include TLO as an Additional Insured. Each policy shall provide that it is primary to and not contributory with any other insurance, including any self-insured retention, maintained by TLO (which shall be excess) and each policy shall provide the full coverage required by this Agreement and any Terminal Service Order. All such insurance shall be written with carriers and underwriters acceptable to TLO, and eligible to do business in the State of California and having and maintaining an A.M. Best financial strength rating of no less than “A-” and financial size rating no less than “VII”; provided that TRMC may procure worker’s compensation insurance from the State of California. All limits listed below are required MINIMUM LIMITS:


(i)	Workers Compensation and Occupational Disease Insurance which fully complies with Applicable Law of the State of California, in limits not less than statutory requirements;


(ii)	Employers Liability Insurance with a minimum limit of $1,000,000 for each accident, covering injury or death to any employee which may be outside the scope of the worker’s compensation statute of the jurisdiction in which the worker’s service is performed, and in the aggregate as respects occupational disease;


(iii)	Commercial General Liability Insurance, with minimum limits of $1,000,000 combined single limit per occurrence for bodily injury and property damage liability, or such higher limits as may be required by TLO or by Applicable Law from time to time. This policy shall include Broad Form Contractual Liability insurance coverage which shall specifically

apply to the obligations assumed in this Agreement and any Terminal Service Order by TRMC;


(iv)	Automobile Liability Insurance covering all owned, non-owned and hired vehicles, with minimum limits of $1,000,000 combined single limit per occurrence for bodily injury and property damage liability, or such higher limit(s) as may be required by TRMC or by Applicable Law from time to time. Limits of liability for this insurance must be not less than $1,000,000 per occurrence;


(v)	Excess (Umbrella) Liability Insurance with limits not less than $4,000,000 per occurrence. Additional excess limits may be utilized to supplement inadequate limits in the primary policies required in items (ii), (iii), and (iv) above;


(vi)	Pollution Legal Liability with limits not less than $25,000,000 per loss with an annual aggregate of $25,000,000. Coverage shall apply to bodily injury and property damage including loss of use of damaged property and property that has not been physically injured; cleanup costs, defense, including costs and expenses incurred in the investigation, defense or settlement of claim; and


(vii)	Cargo/Inventory Insurance, with a limit of no less than $1,000,000, which property insurance shall be first-party property insurance to adequately cover all Products owned by TRMC located at the Storage Facility.

(b) Waiver of Subrogation . All such policies must be endorsed with a Waiver of Subrogation endorsement, effectively waiving rights of recovery under subrogation or otherwise, against TLO, and shall contain where applicable, a severability of interest clause and a standard cross liability clause.

(c) Insurance Certificates . Upon execution of this Agreement and prior to the operation of any equipment by TRMC, TRMC will furnish to TLO, and at least annually thereafter (or at any other times upon request by TLO) during the Term (and for any coverage maintained on a “claims-made” basis, for two (2) years after the termination of this Agreement or any applicable Terminal Service Order), insurance certificates and/or certified copies of the original policies to evidence the insurance required herein. Such certificates shall be in the form of the “Accord” Certificate of Insurance, and reflect that they are for the benefit of TLO and shall provide that there will be no material change in or cancellation of the policies unless TLO is given at least thirty (30) days prior written notice. Certificates providing evidence of renewal of coverage shall be furnished to TLO prior to policy expiration.

(d) Self-Insurance . TRMC shall be solely responsible for any deductibles or self-insured retention.

28. NOTICE

All notices or requests or consents provided for by, or permitted to be given pursuant to, this Agreement must be in writing and must be given by depositing same in the United States mail, addressed to the Person to be notified, postpaid, and registered or certified with return receipt requested or by delivering such notice in person or by facsimile to such Party. Notice given by personal delivery or mail shall be effective upon actual receipt. Notice given by facsimile shall be effective upon actual receipt if received during the recipient’s normal business hours or at the beginning of the recipient’s next business day after receipt if not received during the recipient’s normal business hours. All notices to be sent to a Party pursuant

to this Agreement shall be sent to or made at the address set forth below or at such other address as such Party may stipulate to the other Parties in the manner provided in this Section 28 .

If to TRMC, to:

Tesoro Refining & Marketing Company LLC

19100 Ridgewood Parkway

San Antonio, Texas 78259

For legal notices :

Attention: General Counsel

If to TLO, to:

Tesoro Logistics Operations LLC

19100 Ridgewood Parkway

San Antonio, Texas 78259

For legal notices :

Attention: General Counsel

For all other notices and communications :

Attention: Don J. Sorensen, Vice President, Operations

phone: (210) 626-6195

email: Don.J.Sorensen@tsocorp.com

or to such other address or to such other Person as either Party will have last designated by notice to the other Party.

29. CONFIDENTIAL INFORMATION

(a) Obligations . Each Party shall use reasonable efforts to retain the other Parties’ Confidential Information in confidence and not disclose the same to any third party nor use the same, except as authorized by the disclosing Party in writing or as expressly permitted in this Section 29 . Each Party further agrees to take the same care with the other Party’s Confidential Information as it does with its own, but in no event less than a reasonable degree of care. Excepted from these obligations of confidence and non-use is that information which:

(i) is available, or become available, to the general public without fault of the receiving Party;

(ii) was in the possession of the receiving Party on a non-confidential basis prior to receipt of the same from the disclosing Party (it being understood, for the avoidance of doubt, that this exception shall not apply to information of TLO that was in the possession of TRMC or any of its affiliates as a result of their ownership or operation of the Storage Facility prior to the Commencement Date);

(iii) is obtained by the receiving Party without an obligation of confidence from a third party who is rightfully in possession of such information and, to the receiving Party’s knowledge, is under no obligation of confidentiality to the disclosing Party; or

(iv) is independently developed by the receiving Party without reference to or use of the disclosing Party’s Confidential Information.

For the purpose of this Section 29 , a specific item of Confidential Information shall not be deemed to be within the foregoing exceptions merely because it is embraced by, or underlies, more general information in the public domain or in the possession of the receiving Party.

(b) Required Disclosure . Notwithstanding Section 29(a) above, if the receiving Party becomes legally compelled to disclose the Confidential Information by a court, Governmental Authority or Applicable Law, or is required to disclose by the listing standards of any applicable securities exchange of the disclosing Party’s Confidential Information, the receiving Party shall promptly advise the disclosing Party of such requirement to disclose Confidential Information as soon as the receiving Party becomes aware that such a requirement to disclose might become effective, in order that, where possible, the disclosing Party may seek a protective order or such other remedy as the disclosing Party may consider appropriate in the circumstances. The receiving Party shall disclose only that portion of the disclosing Party’s Confidential Information that it is required to disclose and shall cooperate with the disclosing Party in allowing the disclosing Party to obtain such protective order or other relief.

(c) Return of Information . Upon written request by the disclosing Party, all of the disclosing Party’s Confidential Information in whatever form shall be returned to the disclosing Party or destroyed with destruction certified by the receiving Party upon termination of this Agreement, without the receiving Party retaining copies thereof except that one copy of all such Confidential Information may be retained by a Party’s legal department solely to the extent that such Party is required to keep a copy of such Confidential Information pursuant to Applicable Law, and the receiving Party shall be entitled to retain any Confidential Information in the electronic form or stored on automatic computer back-up archiving systems during the period such backup or archived materials are retained under such Party’s customary procedures and policies; provided , however , that any Confidential Information retained by the receiving Party shall be maintained subject to confidentiality pursuant to the terms of this Section 29 , and such archived or back-up Confidential Information shall not be accessed except as required by Applicable Law.

(d) Receiving Party Personnel . The receiving Party will limit access to the Confidential Information of the disclosing Party to those of its employees, attorneys and contractors that have a need to know such information in order for the receiving Party to exercise or perform its rights and obligations under this Agreement or any Terminal Service Order (the “ Receiving Party Personnel ” ). The Receiving Party Personnel who have access to any Confidential Information of the disclosing Party will be made aware of the confidentiality provision of this Agreement, and will be required to abide by the terms thereof. Any third party contractors that are given access to Confidential Information of a disclosing Party pursuant to the terms hereof shall be required to sign a written agreement pursuant to which such Receiving Party Personnel agree to be bound by the provisions of this Agreement, which written agreement will expressly state that it is enforceable against such Receiving Party Personnel by the disclosing Party.

(e) Survival . The obligation of confidentiality under this Section 29 shall survive the termination of this Agreement for a period of two (2) years.

30. MISCELLANEOUS

(a) Modification; Waiver . This Agreement or any Terminal Service Order may be amended or modified only by a written instrument executed by the Parties. Any of the terms and conditions of this Agreement or any Terminal Service Order may be waived in writing at any time by the Party entitled to the benefits thereof. No waiver of any of the terms and conditions of this Agreement or any Terminal Service Order, or any breach thereof, will be effective unless in writing signed by a duly authorized individual on behalf of the Party against which the waiver is sought to be enforced. No waiver of any term or condition

or of any breach of this Agreement or any Terminal Service Order will be deemed or will constitute a waiver of any other term or condition or of any later breach (whether or not similar), nor will such waiver constitute a continuing waiver unless otherwise expressly provided.

(b) Integration . This Agreement, together with the Schedules and Terminal Service Orders and the other agreements executed on the date hereof in connection with the transactions contemplated by the Contribution Agreement, constitutes the entire agreement among the Parties pertaining to the subject matter hereof and supersedes all prior agreements and understandings of the Parties in connection therewith. In the event of a conflict of provisions of this Agreement and the Omnibus Agreement, the provisions of the Omnibus Agreement shall prevail with respect to issues related to the contribution of the assets described therein, but not with respect to the ordinary operations of such assets as set forth in this Agreement.

(c) Construction and Interpretation . In interpreting this Agreement, unless the context expressly requires otherwise, all of the following apply to the interpretation of this Agreement:

(i) Preparation of this Agreement has been a joint effort of the Parties and the resulting Agreement shall not be interpreted against one of the Parties as the drafting Party.

(ii) Plural and singular words each include the other.

(iii) Masculine, feminine and neutral genders each include the others.

(iv) The word “or” is not exclusive and includes “and/or.”

(v) The words “includes” and “including” are not limiting.

(vi) References to the Parties include their respective successors and permitted assignees.

(vii) The headings in this Agreement are included for convenience and do not affect the construction or interpretation of any provision of, or the rights or obligations of a Party under, this Agreement.

(d) Governing Law; Jurisdiction . This Agreement and any Terminal Service Order shall be governed by the laws of the State of Texas without giving effect to its conflict of laws principles. Each Party hereby irrevocably submits to the exclusive jurisdiction of any federal court of competent jurisdiction situated in the United States District Court for the Western District of Texas, San Antonio Division, or if such federal court declines to exercise or does not have jurisdiction, in the district court of Bexar County, Texas. The Parties expressly and irrevocably submit to the jurisdiction of said Courts and irrevocably waive any objection which they may now or hereafter have to the laying of venue of any action, suit or proceeding arising out of or relating to this Agreement or any Terminal Service Order brought in such Courts, irrevocably waive any claim that any such action, suit or proceeding brought in any such Court has been brought in an inconvenient forum and further irrevocably waive the right to object, with respect to such claim, action, suit or proceeding brought in any such Court, that such Court does not have jurisdiction over such Party. The Parties hereby irrevocably consent to the service of process by registered mail, postage prepaid, or by personal service within or without the State of Texas. Nothing contained herein shall affect the right to serve process in any manner permitted by law.

(e) Counterparts . This Agreement and any Terminal Service Order may be executed in one or more counterparts (including by facsimile or portable document format (pdf)) for the convenience of the Parties hereto, each of which counterparts will be deemed an original, but all of which counterparts together will constitute one and the same agreement.

(f) Severability . Whenever possible, each provision of this Agreement and any Terminal Service Order will be interpreted in such manner as to be valid and effective under applicable law, but if any provision of this Agreement or any Terminal Service Order or the application of any such provision to any Person or circumstance will be held invalid, illegal or unenforceable in any respect by a court of competent jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision hereof, and the Parties will negotiate in good faith with a view to substitute for such provision a suitable and equitable solution in order to carry out, so far as may be valid and enforceable, the intent and purpose of such invalid, illegal or unenforceable provision.

(g) No Third-Party Beneficiaries . Except as specifically provided herein, including as set forth in Section 20 , it is expressly understood that the provisions of this Agreement and any Terminal Service Order do not impart enforceable rights in anyone who is not a Party or successor or permitted assignee of a Party.

(h) WAIVER OF JURY TRIAL . EACH PARTY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY PROCEEDINGS RELATING TO THIS AGREEMENT OR ANY PERFORMANCE OF OR FAILURE TO PERFORM ANY OBLIGATION HEREUNDER.

(i) Schedules and Terminal Service Orders(s) . Each of the Schedules and Terminal Service Order(s) attached hereto and referred to herein is hereby incorporated in and made a part of this Agreement as if set forth in full herein.

[Signature Page Follows]

IN WITNESS WHEREOF , the Parties hereto have duly executed this Agreement as of the date first written above.




TESORO LOGISTICS OPERATIONS LLC		TESORO REFINING & MARKETING COMPANY LLC
TESORO LOGISTICS OPERATIONS LLC		TESORO REFINING & MARKETING COMPANY LLC

By:	/s/ Phillip M. Anderson	By:	/s/ Gregory J. Goff
	Phillip M. Anderson		Gregory J. Goff
	President		Chairman of the Board of Managers and President



Solely with respect to Section 25 (a) :		Solely with respect to Section 25 (a) :
TESORO LOGISTICS GP, LLC		TESORO LOGISTICS LP

By:	/s/ Phillip M. Anderson	By:	Tesoro Logistics GP, LLC, its general partner
	Phillip M. Anderson		Tesoro Logistics GP, LLC, its general partner
	President
		By:	/s/ Phillip M. Anderson
			Phillip M. Anderson
			President

Signature Page to

Martinez Storage Services Agreement

SCHEDULE A

Storage Facility

51 crude and black-oils and petroleum product storage tanks with a total shell capacity of approximately 5,644,833 Barrels and pipelines and other appurtenances that allow the transport of crude oil and petroleum products to and from the nearby dock and to and from other facilities located at TRMC’s refinery near Martinez in Contra Costa County, California.

Schedule A -

Martinez Storage Services Agreement

Exhibit 10.2

SCHEDULE B

OWNED TANKS



		Shell Capacity
	Tank #	(Barrels)
	TK003	71,100
	TK026	97,900
	TK033	97,900
	TK037	53,688
	TK038	53,678
	TK217	97,800
	TK270	75,400
	TK272	75,500
	TK274	75,500
	TK601	14,600
	TK612	10,400
	TK613	10,400
	TK631	122,700
	TK637	71,600
	TK638	71,600
	TK639	71,600
	TK640	71,600
	TK641	71,600
	TK664	116,500
	TK690	283,000
	TK691	222,100
	TK692	66,000
	TK694	283,000
	TK696	13,616
	TK697	13,500
	TK698	13,500
	TK701	283,000
	TK702	117,300
	TK705	210,000
	TK706	113,000
	TK707	113,000
	TK708	283,000
	TK709	113,000
	TK710	80,000
	TK711	80,000
	TK849	112,000
	TK866	218,400
	TK867	218,400
	TK868	86,700
	TK869	86,700

Schedule B -

Martinez Storage Services Agreement

Exhibit 10.2



	TK870	119,171
	TK871	283,000
	TK872	218,400
	TK893	114,300
	TK894	113,300
	TK904	115,600
	TK905	126,700
	TK932	86,700
	TK933	127,000
	TK961	190
	TK981	190

OPERATED TANKS



		Shell Capacity
	Tank #	(Barrels)
	TK258	14,600
	TK517	75,100
	TK033	63,080

Schedule B -

Martinez Storage Services Agreement

EXHIBIT 1

FORM OF TERMINAL SERVICE ORDER

(MARTINEZ [ ]- ___, 20__)

This Terminal Service Order is entered as of ___, 20__, by and between Tesoro Refining & Marketing Company LLC, a Delaware limited liability company, and Tesoro Logistics Operations LLC, a Delaware limited liability company, pursuant to and in accordance with the terms of the Martinez Storage Services Agreement dated as of November 21, 2016, by and among such parties and Tesoro Logistics GP, LLC, a Delaware limited liability company, and Tesoro Logistics LP, a Delaware limited partnership (the “Agreement”).

Capitalized terms not otherwise defined herein shall have the meaning set forth in the Agreement.

Pursuant to Section 6 of the Agreement, the parties hereto agree to the following provisions:

(i) the Shell Capacity of each Tank;

(ii) the Storage Services Fee pursuant to Section 5 ;

(iii) any reimbursement pursuant to Section 8(a) ;

(iv) any Surcharge pursuant to Section 8(b) ;

(v) any modification, cleaning, or conversion of a Tank as requested by TRMC pursuant to Section 9(a) ;

(vi) any agreements with respect to the Storage Service Fee during periods of repair or maintenance pursuant to Section 9(b) ;

(vii) any reimbursement related to newly imposed taxes and regulations pursuant to Section 10 ; and

(viii) any other services or use of facilities that may be agreed upon by the Parties pursuant to Section 16 .

Except as set forth in this Terminal Service Order, the other terms of the Agreement shall continue in full force and effect and shall apply to the terms of this Terminal Service Order.

Exhibit 1 -

Martinez Storage Services Agreement

IN WITNESS WHEREOF , the parties hereto have duly executed this Terminal Service Order as of the date first written above.




TESORO REFINING & MARKETING COMPANY LLC

By:
Name:
Title:



TESORO LOGISTICS OPERATIONS LLC

By:
Name:
Title:

Exhibit 1 -

Martinez Storage Services Agreement

EXHIBIT 10.3

LICENSE AGREEMENT

This License Agreement (this “ Agreement ”) is effective as of November 21, 2016 (“ Effective Date ”), by and between Tesoro Refining & Marketing Company LLC, a Delaware limited liability company (“ TRMC ”), and Tesoro Logistics Operations LLC, a Delaware limited liability company (“ TLO ”).

A. WHEREAS , TRMC is the owner of those certain parcels of real property in Contra Costa County, California, described Exhibit A hereto (the “ License Area ”) comprising a portion of TRMC’s refinery near Martinez in Contra Costa County, California (the “ Facility ”);

B. WHEREAS, TRMC, TLO, Tesoro Logistics LP, a Delaware limited partnership, Tesoro Corporation, a Delaware corporation, and Tesoro Logistics GP, LLC, a Delaware limited liability company, have entered that certain Contribution, Conveyance and Assumption Agreement effective as of November 21, 2016 (the “ Contribution Agreement ”);

C. WHEREAS , pursuant to the Contribution Agreement, TRMC has transferred certain Tanks and Pipelines to TLO (the “ Transferred Storage Assets ”);

D. WHEREAS , TRMC and TLO have entered in that certain Martinez Storage Services Agreement, effective November 21, 2016 (the “ Storage Services Agreement ”), pursuant to which TLO has agreed to provide certain storage and handling services to TRMC utilizing the Transferred Storage Assets (the “ Services ”) (capitalized terms used in this Agreement but not defined herein shall have the meanings given to them in the Storage Services Agreement);

E. WHEREAS , TRMC desires to give TLO rights to use, operate on and access the License Area and certain other portions of the Facility for the purpose of operating and maintaining the Transferred Storage Assets and providing the Services; and

F. WHEREAS, TRMC and TLO desire to enter into this Agreement for the purpose of permitting such access, all on the terms and conditions herein set forth.

NOW, THEREFORE , in consideration of the recitals set forth above (which recitals are incorporated herein by this reference), the mutual covenants herein, and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties agree as follows:

1. Access Rights .

(a) Access Rights to TLO . Subject to the terms and conditions of this Agreement, TRMC grants to TLO and its agents, representatives and contractors (collectively, “ Agents ”) and each of their employees (the Agents, together with TLO, and each of their employees, hereinafter defined as the “ Users ”), the non-exclusive right to use, operate on and access the License Area and those pumps, pipelines, sheds, facilities and equipment located at the Facility not included in the Transferred Storage Assets and not situated in the License Area (including the Operated Tanks) but necessary for the operation of the Transferred Storage Assets (“ Infrastructure ”) for the purposes

described herein. TRMC will permit the Users access through the Facility (through areas designated by TRMC) in order to access the License Area and Infrastructure for the purposes described herein on the terms and conditions of this Agreement.

(b) Purpose . The Users' access to the License Area and Infrastructure shall be for the limited purpose of operating and maintaining the Transferred Storage Assets and Infrastructure and providing the Services.

(c) Tankage and Pipeline Placement . Subject to the terms and conditions of this Agreement, TRMC grants to TLO the right to keep in place the Transferred Storage Assets within the License Area in their current location and configuration.

(d) Minimal Interference . The Users shall access the Facility at all times in a manner so as to cause minimal interference with TRMC’s operations.

(e) Term . The rights set forth in this Section 1 constitute a revocable license, shall commence on the Effective Date, and terminate upon thirty (30) days’ written notice of termination provided by TRMC to TLO. All obligations that accrue prior to such termination shall survive the termination.

(f) Pre-Existing Rights . The rights set forth in this Agreement are subject to any pre-existing rights, licenses and easements over the Facility and any reserved rights set forth in this Agreement.

2. Facility Rules; Compliance with Laws . TLO shall comply, and shall cause the Users to comply, with all rules, regulations and requirements imposed by TRMC with respect to the Facility, including, without limitation, authorized entry procedures (“ Facility Rules ”), and all applicable federal, state and local laws, statutes, ordinances, rules, and regulations, including, without limitation, the obligation to obtain and comply with all permits and licenses required by law (“ Applicable Laws ”). TLO agrees that all vehicles and equipment owned, leased or otherwise under the control of TLO or its Agents will be properly maintained, and kept in a safe condition. TLO shall promptly remove any equipment of TLO or its Agents that in TRMC's discretion poses a safety hazard at the Facility. TLO shall be responsible for the Users and their compliance and/or non-compliance with the Facility Rules, Applicable Laws, and the terms of this Agreement while such Users are at the Facility or otherwise acting on behalf of TLO.

3. Notices . All notices, requests, demands, and other communications hereunder will be in writing and All notices or requests or consents provided for by, or permitted to be given pursuant to, this Agreement must be in writing and must be given by depositing same in the United States mail, addressed to the party to be notified, postpaid, and registered or certified with return receipt requested or by delivering such notice in person or by facsimile to such party. Notice given by personal delivery or mail shall be effective upon actual receipt. Notice given by facsimile shall be effective upon actual receipt if received during the recipient’s normal business hours or at the beginning of the recipient’s next business day after receipt if not received during the recipient’s normal business hours. All notices to be sent to a party pursuant to this Agreement shall be sent to or made at the address set forth below or at such other address as such party may stipulate to the

other party in the manner provided in this Section 3 .

If to TRMC, to:

Tesoro Refining & Marketing Company LLC

19100 Ridgewood Parkway

San Antonio, Texas 78259

For legal notices :

Attention: General Counsel

If to TLO, to:

Tesoro Logistics Operations LLC

19100 Ridgewood Parkway

San Antonio, Texas 78259

For legal notices :

Attention: General Counsel

For all other notices and communications :

Attention: Don J. Sorensen, Vice President, Operations

phone: (210) 626-6195

email: Don.J.Sorensen@tsocorp.com

or to such other address or to such other person as either party will have last designated by notice to the other party.

4. Reserved Rights . TRMC reserves the right to take any and all actions for the construction, installation, repair, replacement and maintenance of the improvements and utilities on the Facility as necessary or desirable for the orderly and proper development, maintenance, repair and operation of the Facility. Nothing herein shall restrict TRMC from granting to any public utility, public body or authority, or to any third party, rights over or under the Facility for utility lines and facilities, water, storm and sanitary sewer, and related conduits and facilities, or for drainage or slope purposes, or for pipeline purposes, so long as such easements do not materially and adversely affect the rights and privileges granted to TLO in this Agreement.

5. General Provisions .

(a) Costs . Each party shall pay its own costs and expenses with respect to the transactions contemplated by this Agreement.

(b) Headings; References; Interpretation . All Section headings in this Agreement are for convenience only and shall not be deemed to control or affect the meaning or construction of any of the provisions hereof. The words “hereof,” “herein” and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole, including, without limitation, any Exhibit attached hereto, and not to any particular provision of this Agreement. All references herein to Sections and Exhibits shall, unless the context requires a different construction, be deemed to be references to the Sections of this Agreement and the Exhibits attached hereto, and any such Exhibit attached hereto is hereby incorporated herein and made a part

hereof for all purposes. All personal pronouns used in this Agreement, whether used in the masculine, feminine or neuter gender, shall include all other genders, and the singular shall include the plural and vice versa. The use herein of the word “including” following any general statement, term or matter shall not be construed to limit such statement, term or matter to the specific items or matters set forth immediately following such word or to similar items or matters, whether or not non-limiting language (such as “without limitation,” “but not limited to” or words of similar import) is used with reference thereto, but rather shall be deemed to refer to all other items or matters that could reasonably fall within the broadest possible scope of such general statement, term or matter.

(c) Successors and Assigns . This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns.

(d) No Third Party Rights . The provisions of this Agreement are intended to bind the parties as to each other and are not intended to and do not create rights in any other person or confer upon any other person any benefits, rights or remedies, and no person is or is intended to be a third party beneficiary of any of the provisions of this Agreement.

(e) Counterparts . This Agreement may be executed in any number of counterparts (including facsimile or .pdf copies) with the same effect as if all parties had signed the same document. All counterparts shall be construed together and shall constitute one and the same instrument.

(f) Applicable Law; Forum, Venue and Jurisdiction . This Agreement shall be construed in accordance with and governed by the laws of the State of Texas, without regard to the principles of conflicts of law. Each of the parties (i) irrevocably agrees that any claims, suits, actions or proceedings arising out of or relating in any way to this Agreement shall be exclusively brought in any federal court of competent jurisdiction situated in the United States District Court for the Western District of Texas, San Antonio Division, or if such federal court declines to exercise or does not have jurisdiction, in the district court of Bexar County, Texas, in each case regardless of whether such claims, suits, actions or proceedings sound in contract, tort, fraud or otherwise, are based on common law, statutory, equitable, legal or other grounds, or are derivative or direct claims, (ii) irrevocably submits to the exclusive jurisdiction of the United States District Court for the Western District of Texas, San Antonio Division, or if such federal court declines to exercise or does not have jurisdiction, of the district court of Bexar County, Texas in connection with any such claim, suit, action or proceeding, (iii) agrees not to, and waives any right to, assert in any such claim, suit, action or proceeding that (A) it is not personally subject to the jurisdiction of the United States District Court for the Western District of Texas, San Antonio Division, or the district court of Bexar County, Texas, or of any other court to which proceedings in such courts may be appealed, (B) such claim, suit, action or proceeding is brought in an inconvenient forum, or (C) the venue of such claim, suit, action or proceeding is improper, (iv) expressly waives any requirement for the posting of a bond by a party bringing such claim, suit, action or proceeding and (v) consents to process being served in any such claim, suit, action or proceeding by mailing, certified mail, return receipt requested, a copy thereof to such party at the address in effect for notices hereunder or by personal service within or without the State of Texas, and agrees that service in such forms shall constitute

good and sufficient service of process and notice thereof; provided, however, that nothing in clause (v) hereof shall affect or limit any right to serve process in any other manner permitted by law.

(g) Severability . If any of the provisions of this Agreement are held by any court of competent jurisdiction to contravene, or to be invalid under, the laws of any political body having jurisdiction over the subject matter hereof, such contravention or invalidity shall not invalidate the entire Agreement. Instead, this Agreement shall be construed as if it did not contain the particular provision or provisions held to be invalid and an equitable adjustment shall be made and necessary provision added so as to give effect to the intention of the parties as expressed in this Agreement at the time of execution of this Agreement.

(h) Amendment or Modification . This Agreement may be amended or modified from time to time only by the written agreement of all the parties. Each such instrument shall be reduced to writing and shall be designated on its face as an amendment to this Agreement.

(i) Integration . This Agreement, together with Exhibit A referenced herein, constitutes the entire agreement among the parties pertaining to the subject matter hereof and supersedes all prior agreements and understandings of the parties in connection therewith.

[Signature Page Follows]

IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the Effective Date.




TRMC:		TLO:

TESORO REFINING & MARKETING COMPANY LLC, a Delaware limited liability company		TESORO LOGISTICS OPERATIONS LLC, a Delaware limited liability company



By:	/s/ Gregory J. Goff	By:	/s/ Phillip M. Anderson
	Gregory J. Goff		Phillip M. Anderson
	Chairman of the Board of Managers and President		President

Signature Page to License Agreement

EXHIBIT A

LICENSE AREA

I. Legal Description

TRACT 3A - LICENSE AREA

A PORTION OF SWAMP AND OVERFLOW SURVEYS No. 87 AS DESCRIBED IN THE PATENT RECORDED NOVEMBER 30, 1875 IN BOOK 2 OF PATENTS, PAGE 310; AND DEED RECORDED MAY 17, 2002 AS DOC. NO. 2002-0177826 O.R. IN THE COUNTY OF CONTRA COSTA, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS:

COMMENCING AT THE INTERSECTION OF THE NORTHERLY LINE OF THE COUNTY ROAD RUNNING FROM AVON TO BAY POINT AS DESCRIBED IN DEED TO THE COUNTY OF CONTRA COSTA, RECORDED JUNE 18, 1913, IN BOOK 205 OF DEEDS, PAGE 141, WITH THE EASTERLY LINE OF THAT CERTAIN 305 .931 ACRE PARCEL SHOWN ON LICENSE SURVEY MAP RECORDED DECEMBER 31, 1954 IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY IN BOOK 16 OF LICENSE SURVEY MAPS PAGE 36,SAID INTERSECTION SHOWN AS MARKED BY A RAILROAD SPIKE ON SAID LICENSE SURVEY MAP;

THENCE ALONG THE NORTHERLY LINE OF SAID COUNTY ROAD SOUTH 71°22'28" WEST A DISTANCE OF 2511.41 FEET TO THE TRUE POINT OF BEGINNING;

THENCE CONTINUING ALONG SAID NORTHERLY LINE SOUTH 71°22'28" WEST A DISTANCE OF 356.06 FEET TO AN ANGLE POINT IN THE NORTHERLY LINE OF SAID COUNTY ROAD;

THENCE CONTINUING ALONG SAID NORTHERLY LINE, NORTH 58°37'32" WEST, A DISTANCE OF 117.49 FEET TO AN ANGLE POINT IN SAID NORTHERLY LINE;

THENCE LEAVING SAID NORTHERLY LINE OF SAID COUNTY ROAD, NORTH 22°14'31" WEST, A DISTANCE OF 67.45 FEET;

THENCE NORTH 66°36'57" EAST, A DISTANCE OF 310.15 FEET; THENCE NORTH 17°39 '09" WEST, A DISTANCE OF 899.30 FEET; THENCE NORTH 12°29'11" EAST, A DISTANCE OF 216.16 FEET; THENCE NORTH 26°12'01" WEST, A DISTANCE OF 294.83 FEET; THENCE NORTH 59°31'48" WEST, A DISTANCE OF 251.48 FEET; THENCE NORTH 45°01'11" EAST, A DISTANCE OF 202 .08 FEET; THENCE NORTH 54°38'01" EAST, A DISTANCE OF 47.77 FEET; THENCE NORTH 04°53'37" EAST, A DISTANCE OF 127 .38 FEET; THENCE NORTH 77°22'35" EAST, A DISTANCE OF 412.17 FEET; THENCE SOUTH 10°43 '48" EAST, A DISTANCE OF 193.28 FEET; THENCE SOUTH 72°26'39" EAST, A DISTANCE OF 301.02 FEET; THENCE SOUTH 38°59'24" EAST, A DISTANCE OF 183.77 FEET; THENCE SOUTH 48°43'57" EAST, A DISTANCE OF 462.41 FEET; THENCE SOUTH 23°12'10" WEST, A DISTANCE OF 257 .66 FEET;

Exhibit A to License Agreement

THENCE SOUTH 20°37'15" WEST, A DISTANCE OF 453.24 FEET; THENCE SOUTH 73°45'30" EAST, A DISTANCE OF 263 .37 FEET; THENCE NORTH 23°58'16" WEST, A DISTANCE OF 648.19 FEET; THENCE NORTH 66°28'35 " WEST, A DISTANCE OF 255.59 FEET; THENCE SOUTH 06°41'39" WEST, A DISTANCE OF 262 .83 FEET; THENCE SOUTH 18°10'55" EAST,A DISTANCE OF 877 .99 FEET; THENCE NORTH 78°36'02" EAST, A DISTANCE OF 70.73 FEET;

THENCE SOUTH 12°07'02" EAST, A DISTANCE OF 159.43 FEET TO THE TRUE POINT OF BEGINNING . SAID PARCEL CONTAINS 25.760 ACRES, MORE OR LESS.

HEREIN DESCRIBED BEARINGS ARE BASED ON CALIFORNIA COORDINATE SYSTEM {CCS83) (NSRS2007) EPOCH 2011.0 ZONE 3 .

Exhibit A to License Agreement

TRACT 3B - LICENSE AREA

A PORTION OF SWAMP AND OVERFLOW SURVEYS No. 87 AS DESCRIBED IN THE PATENT RECORDED NOVEMBER 30, 1875 IN BOOK 2 OF PATENTS, PAGE 310, TOGETHER WITH A PORTION OF TIDE LAND SURVEY No. 207 AS DESCRIBED IN THE PATENT RECORDED NOVEMBER 23, 1901 IN BOOK 4 OF PATENTS, PAGE 402; AND DEED RECORDED MAY 17, 2002 AS DOC. NO. 2002-0177826 O.R. IN THE COUNTY OF CONTRA COSTA, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS:

COMMENCING AT THE INTERSECTION OF THE NORTHERLY LINE OF THE COUNTY ROAD RUNNING FROM AVON TO BAY POINT AS DESCRIBED IN DEED TO THE COUNTY OF CONTRA COSTA, RECORDED JUNE 18, 1913, IN BOOK 205 OF DEEDS, PAGE 141, WITH THE EASTERLY LINE OF THAT CERTAIN 305.931 ACRE PARCEL SHOWN ON LICENSE SURVEY MAP RECORDED DECEMBER 31,1954 IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY IN BOOK 16 OF LICENSE SURVEY MAPS PAGE 36, SAID INTERSECTION SHOWN AS MARKED BY A RAILROAD SPIKE ON SAID LICENSE SURVEY MAP;

THENCE NORTHWESTERLY ALONG THE BOUNDARY OF SAID 305.931 ACRE PARCEL THE FOLLOWING EIGHT COURSES: NORTH 50°50'42" WEST, 3934.22 FEET;

THENCE SOUTH 55°57'28" WEST, 332.20 FEET;

THENCE SOUTH 23°48'28" WEST, 316.40 FEET;

THENCE NORTH 35°08'12" WEST, 170.93 FEET;

THENCE SOUTH 17°18'12" EAST, 222.72 FEET;

THENCE NORTH 50°54'40" WEST, 236.34 FEET;

THENCE NORTH 17°17'32" WEST, 2046.78 FEET;

THENCE SOUTH 72°48'28" WEST, 668.21 FEET TO THE TRUE POINT OF BEGINNING;

THENCE SOUTHEASTERLY LEAVING SAID BOUNDARY AND THE NORTHERLY LINE OF SAID 305.931 ACRE PARCEL SOUTH 34°05'24" EAST, 2352 .66 FEET;

THENCE NORTH 56°11'44" EAST, 16.26 FEET;

THENCE SOUTH 33°48'16" EAST, 1134.89 FEET;

THENCE SOUTH 54°38'01" WEST, 44.02 FEET; THENCE SOUTH 45°01'11" WEST, 202.08 FEET; THENCE NORTH 20°30'47" WEST, 222.35 FEET;

THENCE NORTH 35°18'23" WEST, 2544.60 FEET; THE CE NORTH 45°43'13" WEST, 233.94 FEET; THENCE NORTH 31°48'45" WEST, 231.54 FEET;

Exhibit A to License Agreement

THENCE NORTH 87°14'22" WEST, 180.45 FEET;

THENCE NORTH 68°36'09" WEST, 49.65 FEET;

THENCE NORTH 36°37'23" WEST, 133.69 FEET; THENCE NORTH S6°11'44" EAST, 3S0.07 FEET;

THENCE NORTH 34°0S'24" WEST, SS.SS FEET TO SAID NORTHERLY LINE OF SAID 30S.391 ACRE PARCEL;

THENCE ALONG SAID NORTHERLY LINE NORTH 72°48'28" EAST, 104.Sl FEET TO THE TRUE POINT OF BEGINNING.

SAID PARCEL CONTAINS 18.8SS ACRES, MORE OR LESS.

HEREIN DESCRIBED BEARINGS ARE BASED ON CALIFORNIA COORDINATE SYSTEM (CCS83) (NSRS2007) EPOCH 2011.0 ZONE 3.

Exhibit A to License Agreement

TRACT 4 - LICENSE AREA

PARCEL 1AND PARCEL 24 OF LAND CONVEYED TO TESORO REFINING AND MARKETING COMPANY AS DESCRIBED IN DEED RECORDED MAY 17, 2002 AS DOC. NO. 2002-0177826 O.R. IN THE COUNTY OF CONTRA COSTA, STATE OF CALIFORNIA.

Exhibit A to License Agreement

TRACT 6 - LICENSE AREA

COMMENCING AT THE NORTHEASTERLY CORNER OF THAT 191.080 ACRE PARCEL OF LAND AS SHOWN ON LICENSE SURVEY MAP RECORDED DECEMBER 31, 1954 IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY IN BOOK 16 OF LICENSE SURVEY MAPS PAGE 33, SAID INTERSECTION MARKED BY A 2 INCH IRON PIPE ON SAID LICENSE SURVEY MAP;

THENCE SOUTHEASTERLY ALONG THE EASTERLY LINE OF SAID 191.080 ACRE PARCEL SOUTH 25°28'11" EAST A DISTANCE OF 1815.22 FEET TO A POINT;

THENCE LEAVING SAID EASTERLY LINE NORTH 64°31'49" EAST A DISTANCE OF 140.00 FEET TO A POINT ON THE WESTERLY LINE OF THAT 257.788 ACRE PARCEL OF LAND AS SHOWN ON LICENSE SURVEY MAP RECORDED DECEMBER 31,1954 IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY IN BOOK 16 OF LICENSE SURVEY MAPS PAGE 33 AND THE TRUE POINT OF BEGINNING;

THENCE LEAVING SAID WESTERLY LINE NORTH 63°08'11" EAST, A DISTANCE OF 564.56 FEET; THENCE NORTH 17°22'34" WEST, A DISTANCE OF 47.58 FEET;

THENCE NORTH 64°20'10" EAST, A DISTANCE OF 160.28 FEET; THENCE NORTH 36°19'21" EAST, A DISTANCE OF 140.87 FEET; THENCE NORTH 00°14'20" WEST, A DISTANCE OF 115.46 FEET; THENCE NORTH 24°1611811 WEST, A DISTANCE OF 279.19 FEET;

THENCE NORTH 64°02'35" EAST, A DISTANCE OF 90.67 FEET TO A POINT ON A NORTHWESTERLY PROLONGATION OF THE EASTERLY LINE OF SAID 257.788 ACRE PARCEL;

THENCE SOUTHEASTERLY ALONG SAID PROLONGATION SOUTH 25°27'27" EAST, A DISTANCE OF 267.95 FEET TO AN ANGLE POINT IN SAID 257.788 ACRE PARCEL;

THENCE CONTINUING SOUTHEASTERLY ALONG SAID EAST LINE OF SAID 257.788 ACRE PARCEL SOUTH 25°27'27" EAST, A DISTANCE OF 5061.28 FEET TO THE SOUTHEASTERLY CORNER OF SAID 257.788 ACRE PARCEL AS SHOWN ON SAID LICENSE SURVEY MAP;

THENCE ALONG THE SOUTHERLY LINE OF SAID 257.788 ACRE PARCEL SOUTH 80°14'19" EAST, A DISTANCE OF 1038.90 FEET TO THE SOUTHWESTERLY CORNER OF SAID 257.788 ACRE PARCEL;

THENCE ALONG THE WEST LINE OF SAID 257.788 ACRE PARCEL NORTH 25°28'11" EAST, A DISTANCE OF 4535.64 FEET TO THE TRUE POINT OF BEGINNING.

Exhibit A to License Agreement

SAID PARCEL CONTAINS 109.328 ACRES, MORE OR LESS.

HEREIN DESCRIBED BEARINGS ARE BASED ON CALIFORNIA COORDINATE SYSTEM {CCS83) (NSRS2007) EPOCH 2011.0 ZONE 3.

II. Survey Map

(See attached).

Exhibit A to License Agreement

EXHIBIT 10.4

AVON MARINE TERMINAL OPERATING AGREEMENT

This AVON MARINE TERMINAL OPERATING AGREEMENT (the “ Agreement ”) is dated as of the Commencement Date (defined below in Section 1 ), by and between Tesoro Logistics Operations LLC, a Delaware limited liability company (“ Operator ”), and for purposes of Section 22(a) only, Tesoro Logistics GP, LLC, a Delaware limited liability company (“ General Partner ”) and Tesoro Logistics LP, a Delaware limited partnership (“ Partnership ”), on the one hand, and Tesoro Refining & Marketing Company LLC, a Delaware limited liability company (“ TRMC ”), on the other hand.

RECITALS

WHEREAS , TRMC is the current tenant under that certain General Lease - Industrial Use, dated January 1, 2015 (the “ Master Lease ”), between TRMC and the State of California, acting by and through the California State Lands Commission, covering the property in Contra Costa County, California described in Exhibit A to the Master Lease (the “ Avon Terminal ”);

WHEREAS , the parties hereto have agreed that, upon the satisfaction of certain conditions, TRMC will enter into a Sublease (the “ Sublease ”) with Operator pursuant to which TRMC will sublease the Avon Terminal to Operator and transfer to Operator all of TRMC's leasehold improvements located at the Avon Terminal;

WHEREAS , TRMC desires for Operator to provide the services set forth herein relating to the operation of the Avon Terminal for an interim period prior to the execution of the Sublease; and

WHEREAS , Operator is willing to provide such services to TRMC;

NOW , THEREFORE , in consideration of the covenants and obligations contained herein, the Parties (as defined below) to this Agreement hereby agree as follows:


SECTION 1	DEFINITIONS

Capitalized terms used throughout this Agreement shall have the meanings set forth below, unless otherwise specifically defined herein.

“ Agreement ” has the meaning set forth in the Preamble.

“ Ancillary Facilities ” means all wharves, personnel, spill response equipment, emergency response equipment, fire pumps, fire extinguishers, fire monitors, Self-Contained Breathing Apparatus (“ SCBA ”), toxic gas monitoring equipment, winches, loading arms, hoses, drains, pipes, valves, manifolds, pumps, meters, and all other related equipment and facilities that support the infrastructure required to deliver TRMC’s Product between a Marine Vessel and the Refinery facilities, including the pipeline interconnection between the Avon Terminal and the Refinery facilities and the marine vapor recovery system located on or adjacent to the Avon Terminal, but excluding the vapor compression, recovery and destruction system operated by TRMC at the Refinery, which is being used to provide services to the Avon Terminal.

“ API ” means the American Petroleum Institute.

any similar form of decision of, or any provision or condition of any permit, license or other operating authorization issued by any Governmental Authority having or asserting jurisdiction over the matter or matters in question, whether now or hereafter in effect.

“ ASTM ” means the American Society for Testing and Materials.

“ Avon Terminal ” has the meaning set forth in the Recitals.

“ Barrel ” means a volume equal to 42 U.S. gallons or 231 cubic inches, each at 60 degrees Fahrenheit under one atmosphere of pressure.

“ Business Day ” means a day, other than a Saturday or Sunday, on which banks in New York, New York are open for the general transaction of business.

“ Claims ” has the meaning set forth in Section 19(a) .

“ Commencement Date ” means November 21, 2016.

“ Contaminated Product ” means Product that has one or more of the following characteristics: (a) contains foreign substances not inherent or naturally occurring in Product; and/or (b) fails to meet Operator’s minimum specifications.

“ Contract Year ” means the period commencing on the Commencement Date and ending on the date that is twelve calendar Months after the Commencement Date and each successive calendar year thereafter.

“ Contribution Agreement ” means that certain Contribution, Conveyance and Assumption Agreement, dated November 21, 2016, by and among Tesoro Corporation, TRMC, the General Partner, the Partnership and Operator.

“ Force Majeure ” means any event or circumstances, or any combination of events and/or circumstances, whether foreseeable or not, the occurrence and/or effects of which is beyond the reasonable control of the Party claiming suspension and which by the exercise of due diligence such Party could not avoid or overcome, including:

(i) strikes, picketing, lockouts or other industrial disputes or disturbances;

(ii) acts of the public enemy or of belligerents, hostilities or other disorders, wars (declared or undeclared), blockades, thefts, insurrections, acts of terrorism, riots, civil disturbances or sabotage;

(iii) acts of God, acts of nature, landslides, subsidence, severe lightning, earthquakes, volcanic eruptions, fires, tornadoes, hurricanes, storms, floods, washouts, freezing of machinery, equipment or lines of pipe, tidal waves, perils of the sea and other adverse weather conditions;

(iv) arrests and restraints or other interference or restrictions imposed by federal, state or local government whether legal or de facto or purporting to act under some constitution, decree, law or otherwise, necessity for compliance with any court order, or any law, statute, ordinance, regulation, or order promulgated by a federal, state, or local Governmental Authority having or asserting jurisdiction, embargoes or export or import restrictions, expropriation, requisition, confiscation or nationalization; and

(v) epidemics or quarantine, explosions, breakage or accidents to equipment, machinery, plants, facilities or lines of pipe, or electric power, natural gas, or water shortages.

A Party’s inability economically to perform its obligations hereunder does not constitute an event of Force Majeure.

“ General Partner ” has the meaning set forth in the Preamble.

“ Governmental Authority ” means any federal, state, local or foreign government or any provincial, departmental or other political subdivision thereof, or any entity, body, port authority or other authority exercising executive, legislative, judicial, regulatory, administrative or other governmental functions or any court, department, commission, board, bureau, agency, instrumentality or administrative body of any of the foregoing.

“ Gross Standard Volume ” means the total volume of all petroleum liquids and sediment and water, excluding free water, corrected by the appropriate volume correction factor for the observed temperature and API gravity, relative density, or density to a standard temperature such as 60°F and also corrected by the applicable pressure correction factor and meter factor.

“ Marine Vessel ” means any ocean tanker, ocean barge, river barge or other vessel.

“ Master Lease ” has the meaning set forth in the Recitals.

“ Month ” means the period commencing on the Commencement Date and ending on the last day of that calendar month and each successive calendar month thereafter.

“ MOTEMS ” means all state required Marine Oil Terminal and Maintenance Standards.

“ Obligation Cost Reimbursement ” or “ OCR ” have the meanings set forth in Section 6(b).

“ Omnibus Agreement ” means that certain Third Amended and Restated Omnibus Agreement, dated as of July 1, 2014, by and among Tesoro Corporation, TRMC, Tesoro Companies, Inc., Tesoro Alaska Company LLC, the General Partner and the Partnership, as such agreement (and the schedules thereto) may be amended, supplemented or restated from time to time.

“ Operator ” has the meaning set forth in the Preamble.

“ Operator Group ” has the meaning set forth in Section 19(b) .

“ Partnership ” has the meaning set forth in the Preamble.

“ Party ” or “ Parties ” means that each of Operator and TRMC is a “Party” and collectively are the “Parties” to this Agreement.

“ Product ” or “ Products ” means gasoline, gasoline blend component, diesel, distillate, distillate blend components, jet/aviation fuel, fuel oil, cut back resid, cutter stock, gas oil and/or other commodity other than Crude Oil specified in this Agreement or otherwise mutually agreed upon by the Parties.

“ Receiving Party Personnel ” has the meaning set forth in Section 26(d) .

“ Refinery ” means TRMC’s refinery located near Martinez in Contra Costa County, California, including without limitation, tanks owned and operated by Operator to provide services to TRMC under separate agreements.

“ Regulatory Obligations ” means standards, regulations, permits or conditions required by a Governmental Authority.

“ Related Agreements ” means the Storage Services Agreement.

“ Secondment Agreement ” shall mean the Secondment and Logistics Services Agreement dated as of July 1, 2014, as amended, and related service orders.

“ Services ” has the meaning set forth in Section 13(a) .

“ Storage Services Agreement ” means that certain Martinez Storage Services Agreement, dated November 21, 2016, by and among TRMC, Operator, the General Partner and the Partnership, as such agreement may be amended, restated, modified or supplemented from time to time.

“ Sublease ” has the meaning set forth in the Recitals.

“ Term ” has the meaning set forth in Section 4 .

“ Terminal Service Order ” has the meaning set forth in Section 9(a) .

“ Termination Date ” has the meaning set forth in Section 3 .

“ TRMC ” has the meaning set forth in the Preamble.

“ TRMC Group ” has the meaning set forth in Section 19(a) .

“ TRMC Insurance Group ” has the meaning set forth in Section 23(b) .

“ TRMC’s Percentage Allocation ” means TRMC’s actual volumetric percentage utilization of the Avon Terminal as compared to the total volumetric utilization of the Avon Terminal for any calendar year.

“ Waste ” means any (a) spent or remnant commercial chemical products, previously of beneficial use, or other inherently waste-like material; and/or (b) oily ballast water, oily bilge water, sludge, and/or cargo residue by a Marine Vessel transferring Product into or out of the Avon Terminal. Residual Product that retains a beneficial use, including recycling, oil recovery and re-refining, is not Waste unless it is destined for disposal.


SECTION 2	GENERAL UNDERTAKINGS

Subject to the terms and conditions of the Master Lease, the terms and conditions of this Agreement, the rules and procedures for the Avon Terminal set forth in Terminal Service Orders, and all Applicable Law, Operator shall operate, manage and maintain the Avon Terminal on behalf of TRMC during the Term.


SECTION 3	TERMINATION DATE

The “ Termination Date ” will be the effective date of the Sublease.


SECTION 4	TERM

The term of this Agreement shall be for the period commencing on the Commencement Date and ending on the Termination Date (the “ Term ”).


SECTION 5	operation of avon terminal during the term

(a) Operator Covenants . During the Term, Operator covenants as follows:

(i) General Partner, on behalf of Operator, will provide necessary personnel, equipment and other services for the operation, management and maintenance of the Avon Terminal in accordance with the terms of the Master Lease, any other third party use agreements, and this Agreement.

(ii) Operator will reimburse TRMC for:

(1) all rentals paid under the Master Lease;

(2) any and all repairs and maintenance costs and capital expenditures for the Avon Terminal, including without limitation all MOTEMS obligations (other than those scheduled prior to the Commencement Date and covered under the Omnibus Agreement); provided that Operator shall not be required to reimburse TRMC for the amount of any insurance proceeds received by TRMC pursuant to any casualty insurance carried by or for the benefit of TRMC with regard to the Avon Terminal; and

(3 ) without duplication of any amounts reimbursed or paid under the other sections of this Agreement, the Omnibus Agreement or the Secondment Agreement, any and all taxes, fees, charges, insurance premiums, assessments or spill planning and/or response costs (except those costs for oil spill response services provided by the Marine Preservation Association and Marine Spill Response Corporation related to obligations for oil spill prevention response, as provided in Schedule IV of the Omnibus Agreement) and any amounts due for utility services incurred by TRMC as lessee under the Master Lease.

(iii) Operator will indemnify TRMC against any other Claims, liabilities or losses that TRMC incurs in its status as lessee under the Master Lease during the Term.

(iv) Operator will not enter into any other third party contracts for use of the Avon Terminal without prior consent of TRMC.

(b) TRMC Covenants . During the Term as partial compensation for the services provided hereunder, TRMC shall pay Operator the per Barrel fee for throughput across the Avon Terminal as set forth on a Terminal Service Order multiplied by the actual throughput by TRMC across the Avon Terminal for the particular Month.


SECTION 6	PASS THROUGH AND REGULATORY OBLIGATION COST REIMBURSEMENTS

(a) During the Term, TRMC agrees to pay or reimburse Operator for pass-through costs allocable to TRMC’s shipments at the Avon Terminal as follows:

(i) Labor Services . Costs and expenses of any additional services not expressly covered by this Agreement which are requested by TRMC and agreed to by Operator based on the rates set forth on a Terminal Service Order. In addition, TRMC shall pay Operator for any materials used in the performance of such additional services in an amount equal to the cost of such materials, including without limitation chemicals and supplies used by Operation in providing such services.

(ii) Marine Terminal Fees . TRMC shall pay, either directly or by reimbursement to Operator, all applicable third-party charges and related pass-through fees assessed to Operator, by any Governmental Authority, or by any other Persons that are related directly or indirectly to the throughput of Product across the Avon Terminal via Marine Vessel.

(iii) Shore Side Survey or Inspector Fees . TRMC shall pay or reimburse Operator for one hundred percent (100%) of all shore side survey or inspector fees incurred and attributable to each TRMC shipment across the Avon Terminal.

(b) Regulatory Obligation Cost Reimbursements . TRMC will also pay Operator a Monthly regulatory obligation cost reimbursement (“ Obligation Cost Reimbursement ” or “ OCR ”) based on the throughput at the Avon Terminal, calculated as follows:

(i) The OCR shall equal the average of TRMC’s Percentage Allocation at the Avon Terminal for the prior two calendar years multiplied by the amount, as reasonably determined by Operator, which is sufficient to reimburse Operator for the portion of Operator’s actual additional recurring costs incurred at the Avon Terminal after the Commencement Date attributable to Regulatory Obligations.

(ii) With respect to clause (i) of this Section 6(b) , such costs shall include but not be limited to, additional costs, fees and charges for: marine vapor recovery paid for by Operator; shore side pumping; power; and any other similar costs, fees and charges that are incurred by Operator as a result of action by a Governmental Authority.

Before the start of each Contract Year, Operator will provide TRMC with its projected OCR with respect to the Avon Terminal for such Contract Year, with all reasonable supporting documentation and back up in calculating the OCR. Pursuant to this Section 6 , such OCR shall be payable Monthly. Within ninety (90) days after the end of each Contract Year in which OCR is charged to TRMC, Operator shall reconcile the projected OCR charged to and paid by TRMC during such Contract Year with the actual additional operating costs incurred by Operator during such Contract Year and shall credit or debit TRMC’s next recurring invoice according to such reconciliation.

(c) Taxes . All taxes (other than property taxes, ad valorem taxes, income taxes, gross receipt taxes, payroll taxes and other similar taxes) that Operator incurs on TRMC’s behalf for services provided pursuant to this Agreement with respect to the Avon Terminal, shall be reimbursed by TRMC unless prohibited by Applicable Law.

(d) Limitation . In no event will Operator charge or be entitled to pass-through costs or OCR which (i) result from any criminal act of Operator or any of its agents, employees or representatives, or (ii) are in the nature of late fees, penalties or interest that could have been avoided without payment or other obligation by Operator in the exercise of ordinary diligence.


SECTION 7	RESERVED


SECTION 8	RESERVED


SECTION 9	TERMINAL SERVICE ORDERS; PAYMENTS

(a) Description . Operator and TRMC shall enter into one or more terminal service orders for the Avon Terminal substantially in the form attached hereto as Exhibit 1 (each, a “ Terminal Service Order ”). Upon a request by TRMC pursuant to this Agreement or as deemed necessary or appropriate by Operator in connection with the services to be delivered pursuant hereto, Operator shall generate a Terminal Service Order to set forth the specific terms and conditions for providing the applicable services described therein and the applicable fees to be charged for such services. No Terminal Service Order shall be effective until fully executed by both Operator and TRMC. Items available for inclusion on a Terminal Service Order include, but are not limited to:

(i) the rules and procedures for the Avon Terminal referenced in Section 2 ;

(ii) the per Barrel throughput fees at the Avon Terminal;

(iii) the grades and approximate qualities of Products pursuant to Section 10(a)(iii) ;

(iv) the specifics of operations as referenced in Sections 14 and 27 ;

(v) any other calculation methods and procedures applicable to the OCR; and

(vi) any other services as may be agreed.

(b) Invoices . Operator shall invoice TRMC on a Monthly basis and TRMC shall pay all amounts due under this Agreement and any Terminal Service Order no later than ten (10) calendar days after TRMC’s receipt of Operator’s invoices. Any past due payments owed by either Party shall accrue interest, payable on demand, at the lesser of (i) the rate of interest announced publicly by JPMorgan Chase Bank, in New York, New York, as JPMorgan Chase Bank’s prime rate (which Parties acknowledge and agree is announced

by such bank and used by the Parties for reference purposes only and may not represent the lowest or best rate available to any of the customers of such bank or the Parties), plus four percent (4%), and (ii) the highest rate of interest (if any) permitted by Applicable Law, from the due date of the payment through the actual date of payment.

(c) Disputed Amounts . If TRMC reasonably disputes any amount invoiced by Operator, TRMC shall pay the amount of the invoice when due and provide Operator with written notice stating the nature of the dispute prior to thirty (30) days after the due date of the invoice. TRMC and Operator shall use reasonable commercial diligence to resolve disputes in a timely manner through the dispute resolution procedures provide for herein. All portions of the disputed amount determined to be owed TRMC shall be refunded to TRMC within ten (10) days of the dispute resolution.

(d) Fee Increases . Any fees of a fixed amount set forth in this Agreement and any Terminal Service Order shall be increased on July 1 of each year of the Term, commencing on July 1, 2017, by a percentage equal to the greater of zero or the positive change, if any, in the CPI-U (All Urban Consumers) for the prior calendar year, as reported by the Bureau of Labor Statistics, and rounded to the nearest one-tenth (1/10) of one percent (1%).

(e) Conflict between Agreement and Terminal Service Order . In case of any conflict between the terms of this Agreement and the terms of any Terminal Service Order, the terms of the applicable Terminal Service Order shall govern.


SECTION 10	PRODUCT SPECIFICATIONS

(a) Product Quality .

(i) Product Testing . Upon request, TRMC shall provide Operator a laboratory report for each Product delivery by TRMC or TRMC’s supplier. Operator will not be obligated to receive Contaminated Product for throughput across the Avon Terminal, nor will Operator be obligated to accept Product that fails to meet the quality specifications set forth in the arrival notice.

(ii) Off-Spec/Contaminated Product . Operator may, without prejudice to any other remedy available to Operator, reject and return Contaminated Product to TRMC, even after delivery to Operator at the Avon Terminal. TRMC at its sole cost and expense shall be responsible for all damages of any kind, in addition to commodity or Waste removal and cleaning costs for connecting pipelines or third party tankage, resulting from the introduction of Contaminated Product. TRMC shall remove and replace any Contaminated Product or reimburse Operator for any and all expenses incurred in removing and/or replacing any such Contaminated Product received.

(iii) Minimum Specifications . Operator retains at all times under the Term the right to establish and/or change Operator’s minimum specifications, subject to Section 28(a) , for any Product introduced at the Avon Terminal with thirty (30) days advance notice to TRMC. Changes will not affect previously accepted nominated volumes unless immediate action is required by Applicable Law. Operator’s Minimum Specifications shall allow the throughput of the grades and approximate qualities of Products specified in the applicable Terminal Service Order.

(b) Product Warranty . TRMC warrants to Operator that all Products tendered by or for the account of TRMC for throughput across the Avon Terminal will conform to Operator’s minimum specifications for such Product and the most recently available and commonly accepted assay and any applicable API or ASTM standards. Operator may rely upon the specifications and representations of TRMC as to Product quality.

(c) Material Safety Data Sheet . TRMC will provide Operator with a Material Safety Data Sheet and any other information required by any federal, state, or local authority for all Products throughput across the Avon Terminal. TRMC shall provide its customers with the appropriate information on all Products throughput across the Avon Terminal.

(d) Quality Analysis . Operator will not perform any Product quality analysis on behalf of TRMC unless TRMC so requests in writing. Any such quality analyses, including any costs for independent inspectors appointed by TRMC, are for TRMC’s account. In the absence of fraud or manifest error, any quality determination performed by Operator hereunder shall be binding on both Parties. TRMC or its designated independent inspector may observe Operator in any measurement or sampling.


SECTION 11	PRODUCT QUANTITY.

The quantity of product received from or loaded to TRMC’s Marine Vessels shall be based on Gross Standard Volume using the applicable API and ASTM or equivalent standards for Marine Vessel movements by the following (in order of preference), subject to Operator’s reasonable discretion to choose an alternative method: (a) by meters, (b) by static shore tank gauges of the tank or otherwise, (c) by inspector certificates, or (d) by a mutually agreeable method. The custody transfer quantity shall be determined by vessel gauges or bills of lading only when mutually agreed to by TRMC and Operator. TRMC shall provide Operator with all reasonable documentation with respect to the volumes throughput across the Avon Terminal, including but not limited to, inspection reports, meter tickets or other similar documentation within three (3) Business Days of completion of Marine Vessel discharge.


SECTION 12	WASTE AND HAZARDOUS MATERIALS

(a) Storage, Handling and Disposal of Waste . Operator and TRMC will comply with Applicable Law regarding the storage and handling of Product and the disposal of any Waste. TRMC shall pay or reimburse Operator for removal from the Avon Terminal and Ancillary Facilities of any Waste or residuals, including all costs associated with any liabilities arising from such Waste or residual. During such removal, the fees and charges set forth in this Agreement will remain in effect. Unless stated otherwise herein, Operator shall be responsible for any fines, penalties, claims, violations, or similar obligations related to Operator’s operation of the Avon Terminal and Ancillary Facilities.

arrange for the removal of such Waste, Operator will arrange for the removal and disposal of such Waste, and TRMC shall reimburse Operator for the cost of receiving, handling, storing, and shipping such Waste and shall pay for appropriate treatment, storage and disposal of such Waste in compliance with Applicable Law.

(c) Hazardous Materials-Reporting . Operator will report its handling of all hazardous materials for TRMC as required by Applicable Law. TRMC will accurately and properly represent the nature of all such materials to Operator. TRMC agrees to reimburse Operator for any reasonable, direct charges that Operator may be required to pay for the handling of Product, excluding penalties, fines or excess charges resulting from material errors or omissions in Operator’s reporting as required by Applicable Law.


SECTION 13	SERVICES; HOURS; VOLUME GAINS AND LOSSES

(a) Services . Operator shall throughput and handle TRMC’s Products across the Avon Terminal, make all tie-ups and connections at the Avon Terminal (excluding all connection and disconnection of cargo hoses or loading arms at a Marine Vessel’s manifold), provide regulatory compliance reporting that Operator is required to perform as the Avon Terminal operator, and provide such other services set forth in this Agreement (the “ Services ”). Operator will timely provide TRMC with a copy of any regulatory compliance report filed by Operator regarding TRMC’s Product upon request by TRMC. Operator will provide the labor and supervision necessary to perform the Services contemplated by this Agreement, and Operator will provide and maintain the equipment necessary to perform the Services contemplated by this Agreement. Operator will maintain the Avon Terminal according to the Master Lease and good industry practice and will use reasonable care in performing the Services consistent with customary industry practices. TRMC personnel shall make all other Marine Vessel connections to the Avon Terminal, chicksans or hoses.

(b) Existing Contractors . Operator may continue to utilize labor, equipment, materials and supplies provided by contractors under their existing service agreements with TRMC to perform work to be performed by Operator hereunder, without the requirement that such existing contracts be amended, assigned or replaced. Such contracts with TRMC may continue to cover the work to be provided by Operator hereunder, as provided under Section 4(a) of the Secondment Agreement, and Operator shall be responsible for the costs and expenses of such work performed by such contractors pursuant to those provisions of the Secondment Agreement.

(c) Hours . Subject to the terms and conditions of the rules and procedures for the Avon Terminal set forth in Terminal Service Orders, the Avon Terminal will be available on 24/7/365 basis, as needed.

(d) Volume Gains and Losses . Operator shall have no obligation to measure volume gains and losses and shall have no liability whatsoever for normal course physical losses that may result from the transportation of the Products across the Avon Terminal, except if such losses are caused by the negligence or willful misconduct of Operator. TRMC will bear any volume gains and losses that may result from the transportation of the Products across the Avon Terminal.


SECTION 14	OPERATIONS

Operator shall operate the Avon Terminal in accordance with past practices and the applicable provisions of a Terminal Service Order with respect to the Avon Terminal.


SECTION 15	RESERVED


SECTION 16	RESERVED


SECTION 17	COMPLIANCE WITH LAW AND GOVERNMENT REGULATIONS

(a) Party Certification . Each Party certifies that none of the Products covered by this Agreement were derived from crude petroleum, petrochemical, or gas which was produced or withdrawn from storage in violation of any federal, state or other governmental law, nor in violation of any rule or regulation promulgated by any governmental agency having jurisdiction in the premises.

(b) Compliance with Applicable Law . The Parties are entering into this Agreement in reliance upon and shall comply in all material respects with all Applicable Law which directly or indirectly affects the Products throughput hereunder, or any receipt, throughput delivery, transportation, handling or storage of Products hereunder or the ownership, operation or condition of the Avon Terminal. Each Party shall be responsible for compliance with all Applicable Law associated with such Party’s respective performance hereunder and the operation of such Party’s facilities. Without limiting TRMC’s reimbursement obligations under Section 6(b) , in the event any action or obligation imposed upon a Party under this Agreement shall at any time be in conflict with any requirement of Applicable Law, then this Agreement shall immediately be modified to conform the action or obligation so adversely affected to the requirements of the Applicable Law, and all other provisions of this Agreement shall remain effective.

(c) Material Change in Applicable Law . Without limiting TRMC’s reimbursement obligations under Section 6(b) , if during the Term, any new Applicable Law becomes effective or any existing Applicable Law or its interpretation is materially changed, which change is not addressed by another provision of this Agreement or a Terminal Service Order and which has a material adverse economic impact upon a Party, either Party, acting in good faith, shall have the option to request renegotiation of the relevant provisions of this Agreement or a Terminal Service Order with respect to future performance. The Parties shall then meet to negotiate in good faith amendments to this Agreement or an applicable Terminal Service Order that will conform to the new Applicable Law while preserving the Parties’ economic, operational, commercial and competitive arrangements in accordance with the understandings set forth herein.


SECTION 18	LIMITATION Of LIABILITY

(a) Waiver of Consequential and Other Damages . IN NO EVENT SHALL A PARTY BE LIABLE TO THE OTHER PARTY FOR ANY LOST PROFITS OR INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, ARISING FROM THE BREACH, DEFAULT, STRICT LIABILITY, OR THE NEGLIGENT ACTS, ERRORS, OR OMISSIONS OF SUCH PARTY WHILE PERFORMING ITS OBLIGATIONS UNDER THIS AGREEMENT, EXCEPT WITH RESPECT TO INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES ACTUALLY AWARDED TO A THIRD PARTY OR ASSESSED BY A GOVERNMENTAL AUTHORITY AND FOR WHICH A PARTY IS PROPERLY ENTITLED TO INDEMNIFICATION FROM THE OTHER PARTY PURSUANT TO THE EXPRESS PROVISIONS OF THIS AGREEMENT.

(b) Claims and Liability for Lost Product . Operator shall not be liable to TRMC for lost or damaged Product unless (i) Operator would be responsible under Section 13(d) and (ii) TRMC notifies Operator in writing within ninety (90) days of the report of any incident or the date TRMC learns of any

such loss or damage to the Product. Operator’s maximum liability to TRMC for any lost or damaged Product shall be limited to (i) the lesser of (1) the replacement value of the Product at the time of the incident based upon the price as posted by Platts or similar publication for similar Product in the same locality, and if no other similar Product is in the locality, then in the state, or (2) the actual cost paid for the Product by TRMC (copies of TRMC’s invoices of cost paid must be provided), less (ii) the salvage value, if any, of the damaged Product.

(c) Demurrage . Operator assumes no liability for demurrage (whether related to marine movements or otherwise), except if such demurrage is the result of Operator’s negligence or willful misconduct or except as provided in an applicable Terminal Service Order.

(d) No Guarantees or Warranties . Except as expressly provided in this Agreement, neither TRMC nor Operator makes any guarantees or warranties of any kind, expressed or implied. Operator specifically disclaims all implied warranties of any kind or nature, including any implied warranty of merchantability and/or any implied warranty of fitness for a particular purpose.


SECTION 19	INDEMNIFICATION

(a) Duty to Indemnify TRMC Group . Notwithstanding anything to the contrary in this Agreement or any Terminal Service Order, Operator SHALL RELEASE, DEFEND, INDEMNIFY, AND HOLD HARMLESS TRMC, its affiliates and their respective officers, directors, employees, agents, successors, and assigns (excluding any member of the Operator Group) (collectively, the “ TRMC Group ”) from and against all claims, suits, causes of action, demands, losses, liabilities, damages, costs, expenses, fees (including, but not limited to, reasonable attorney’s fees), and court costs (collectively, “ Claims ”), inclusive of Claims made by third parties, arising from or relating to any injury to or death of persons and/or damage, loss, or injury to any property (excluding Product) TO THE EXTENT OF THE PERCENTAGE OR PROPORTION OF DETERMINED FAULT ARISING FROM THE BREACH, DEFAULT, STRICT LIABILITY, WILLFUL MISCONDUCT OR THE NEGLIGENT ACTS, ERRORS, OR OMISSIONS OF OPERATOR OR ANY MEMBER OF THE OPERATOR GROUP (AS DEFINED BELOW) WHILE PERFORMING OPERATOR’S OBLIGATIONS UNDER THIS AGREEMENT.

(b) Duty to Indemnify Operator Group . Notwithstanding anything to the contrary in this Agreement or any Terminal Service Order, TRMC SHALL RELEASE, DEFEND, INDEMNIFY, AND HOLD HARMLESS General Partner, the Partnership, their subsidiaries and their respective officers, directors, members, managers, employees, agents, successors, and assigns (collectively the “ Operator Group ”) from and against all Claims, inclusive of Claims made by third parties, arising from or relating to any injury to or death of persons and/or damage, loss, or injury to any property (excluding Product) TO THE EXTENT OF THE PERCENTAGE OR PROPORTION OF DETERMINED FAULT ARISING FROM THE BREACH, DEFAULT, STRICT LIABILITY, WILLFUL MISCONDUCT OR THE NEGLIGENT ACTS, ERRORS, OR OMISSIONS OF TRMC OR ANY MEMBER OF THE TRMC GROUP WHILE USING THE AVON TERMINAL AND/OR TO THE EXTENT OF THE PERCENTAGE OR PROPORTION OF DETERMINED FAULT ARISING FROM THE BREACH, DEFAULT, STRICT LIABILITY, WILLFUL MISCONDUCT OR THE NEGLIGENT ACTS, ERRORS, OR OMISSIONS OF TRMC OR ANY MEMBER OF THE TRMC GROUP WHILE PERFORMING TRMC’S OBLIGATIONS UNDER THIS AGREEMENT.

(c) Failure to Maintain Required Coverages . In the event that (a) TRMC does not maintain, or does not cause the TRMC Insurance Group members to maintain, the insurance coverages required by Section

23 of this Agreement or (b) TRMC fails to include Operator as an additional insured on all policies of insurance required by Section 23 of this Agreement, then TRMC shall hold harmless and indemnify Operator against all Claims that otherwise would have been insured.

(d) Written Claim . Neither Party shall be obligated to indemnify the other Party or be liable to the other Party unless a written claim for indemnity is delivered to the other Party within ninety (90) days after the date that a Claim is reported or discovered, whichever is earlier.

(e) No Limitation . Except as expressly provided otherwise in this Agreement, the scope of these indemnity provisions may not be altered, restricted, limited, or changed by any other provision of this Agreement. The indemnity obligations of the Parties as set out in this Section 19 are independent of any insurance requirements as set out in Section 23 , and such indemnity obligations shall not be lessened or extinguished by reason of a Party’s failure to obtain the required insurance coverages or by any defenses asserted by a Party’s insurers.

(f) Mutual and Express Acknowledgement . THE INDEMNIFICATION PROVISIONS PROVIDED FOR IN THIS AGREEMENT HAVE BEEN EXPRESSLY NEGOTIATED IN EVERY DETAIL, ARE INTENDED TO BE GIVEN FULL AND LITERAL EFFECT, AND SHALL BE APPLICABLE WHETHER OR NOT THE LIABILITIES, OBLIGATIONS, CLAIMS, JUDGMENTS, LOSSES, COSTS, EXPENSES OR DAMAGES IN QUESTION ARISE OR AROSE SOLELY OR IN PART FROM THE GROSS, ACTIVE, PASSIVE OR CONCURRENT NEGLIGENCE, STRICT LIABILITY, WILLFUL MISCONDUCT OR OTHER FAULT OF ANY INDEMNIFIED PARTY. EACH PARTY ACKNOWLEDGES THAT THIS STATEMENT COMPLIES WITH THE EXPRESS NEGLIGENCE RULE AND CONSTITUTES CONSPICUOUS NOTICE. NOTICE IN THIS CONSPICUOUS NOTICE IS NOT INTENDED TO PROVIDE OR ALTER THE RIGHTS AND OBLIGATIONS OF THE PARTIES, ALL OF WHICH ARE SPECIFIED ELSEWHERE IN THIS AGREEMENT.

(g) Survival . These indemnity obligations shall survive the termination of this Agreement until all applicable statutes of limitation have run regarding any Claims that could be made with respect to the activities contemplated by this Agreement.

(h) Third Party Indemnification . If any Party has the rights to indemnification from a third party, the indemnifying party under this Agreement shall have the right of subrogation with respect to any amounts received from such third-party indemnification claim.


SECTION 20	DEFAULT

(a) A Party shall be in default under this Agreement if:

(unless such failure is not commercially reasonably capable of being cured in such fifteen (15) Business Day period in which case such Party shall have commenced remedial action to cure such breach and shall continue to diligently and timely pursue the completion of such remedial action after such notice); or

(ii) the Party (1) files a petition or otherwise commences, authorizes or acquiesces in the commencement of a proceeding or cause of action under any bankruptcy, insolvency, reorganization or similar Applicable Law, or has any such petition filed or commenced against it, (2) makes an assignment or any general arrangement for the benefit of creditors, (3) otherwise becomes bankrupt or insolvent (however evidenced) or (4) has a liquidator, administrator, receiver, trustee, conservator or similar official appointed with respect to it or any substantial portion of its property or assets.

(b) If either of the Parties is in default as described above, then (i) if TRMC is in default, Operator may or (ii) if Operator is in default, TRMC may: (1) terminate this Agreement upon notice to the defaulting Party; (2) withhold any payments due to the defaulting Party under this Agreement and any Terminal Service Order; and/or (3) pursue any other remedy at law or in equity.

(c) Obligation to Cure Breach . If a Party breaches any provision of this Agreement, a Terminal Service Order or a Related Agreement, which breach does not have a material adverse effect on the other Party, the breaching Party shall still have the obligation to cure such breach.

(d) Cumulative Nature of Remedies . The remedies of TRMC provided for in this Agreement shall not be exclusive, but shall be cumulative and shall be in addition to all other remedies at law or in equity.


SECTION 21	FORCE MAJEURE

If a Party is unable to perform or is delayed in performing, in whole or in part, its obligations under this Agreement, other than the obligation to pay funds when due as a result of an event of Force Majeure at the Avon Terminal or the Ancillary Facilities, then that Party shall promptly notify the other Party of the event of Force Majeure with reasonably full particulars and timing of such event. Such Party also shall promptly notify the other Party when the event of Force Majeure terminates or no longer adversely affects its ability to perform under this Agreement. The obligations of the Party giving notice, so far as they are affected by the event of Force Majeure, shall be suspended during, but not longer than, the continuance of the Force Majeure event. The affected Party must act with commercially reasonable diligence to resume performance, but it shall not be required to expend funds to settle strikes, lockouts or other labor difficulty. A Party’s inability economically to perform its obligations hereunder does not constitute an event of Force Majeure. If Operator is excused from providing services due to an event of Force Majeure, other than any fees that are already due and payable hereunder, any other fees incurred by TRMC during the event of Force Majeure shall be excused or proportionately reduced, as appropriate, for so long as Operator’s performance is so excused due to the event of Force Majeure. In the event the Avon Terminal or any part thereof is destroyed or damaged to such extent as to make them unusable, then the Parties shall consult and, subject to the terms and provisions of the Master Lease, may elect whether or not to repair, replace, or rebuild. An event of Force Majeure shall not extend the term of this Agreement. If an event of Force Majeure materially

affects either Party’s performance under this Agreement and exists with respect to the Avon Terminal or the Ancillary Facilities for twelve (12) Months, then either Party shall have the right to terminate this Agreement without further costs or obligation to the other Party.


SECTION 22	ASSIGNMENT

(a) As of the Commencement Date, the General Partner shall assign all of its rights and obligations under this Agreement to the Partnership. The Partnership shall immediately assign its rights and obligations hereunder to Operator. Upon such assignment to Operator, Operator shall have all of the respective rights and obligations set forth herein during the Term of this Agreement. (Nothing in this Section 22(a) shall affect Operator’s covenants set forth in Section 5(a)(i) of this Agreement.)

(b) Except as otherwise provided in this Section 22 , TRMC shall not transfer, assign, or convey its interests hereunder, in whole or in part, to a third party without the written consent of the Operator, which shall not be unreasonably withheld. Operator may assign its interest hereunder without consent from TRMC to any subsidiary or affiliated company. Operator shall be permitted to make a collateral assignment of this Agreement solely to secure working capital financing for Operator. TRMC may assign its interest hereunder without consent from Operator to any subsidiary or affiliated company or any purchaser of the Refinery, provided that such purchaser meets acceptable credit standards to be determined in Operator’s commercially reasonable discretion. A Party making a permitted assignment shall notify the other Party in writing at least ten (10) days prior to the effective date of such assignment.


SECTION 23	INSURANCE

(a) Insurance Required by Operator . Operator shall be required to carry at least the minimum level of insurance required pursuant to the Master Lease, except for casualty insurance with regard to the Avon Terminal which shall remain the responsibility of TRMC.

(b) Insurance Required by TRMC . TRMC shall obtain at its sole cost and expense and shall carry and maintain in full force and effect, and cause its carriers, contractors, agents and representatives (collectively the “ TRMC Insurance Group ”) to obtain and maintain, insurance coverages with insurance companies rated not less than A-, IX by A.M. Best or otherwise reasonably satisfactory to Operator of the following types and amounts:

(i) Workers’ Compensation . Workers’ Compensation Insurance for statutory limits and in accordance with the Applicable Laws of the state(s) where the work or operations under this Agreement are to be performed, including, without limitation, the U.S. Longshore and Harbor Workers’ Compensation Act as well as the Outer Continental Shelf Lands Act with Volunteer Compensation for marine operations to include transportation, wages, maintenance and cure, and Jones Act Coverage where required;

(ii) Employer’s Liability . Employer's Liability Insurance (including, where applicable, maritime employer liability coverage and/or coverage for liabilities under the U.S. Longshore and Harbor Workers’ Act and the Jones Act), in the following minimum limits:

(1) Bodily injury by accident - $1,000,000 per accident;

(2) Bodily injury by disease - $1,000,000 each employee; and

(3) Bodily injury by disease - $1,000,000 policy limit.

(iii) Commercial Automobile . Commercial Automobile Liability Insurance covering each vehicle whether owned, non-owned, hired, operated, or used by TRMC and/or any member of the TRMC Insurance Group while in, on or adjacent to the Avon Terminal, with a combined single limit of not less than one million dollars ($1,000,000) for bodily injury and property damage as to any one accident, including an MCS-90 endorsement.

(iv) Commercial General Liability . Commercial General Liability Insurance including coverages for contractual liability, third-party personal injury liability, and sudden and accidental pollution, with limits of not less than one million dollars ($1,000,000) per occurrence.

(v) Excess Liability . Excess Liability Insurance in excess of the insurance coverages required at Sections 23(a)(ii) , (iii) and (iv) above, with a limit of not less than twenty-four million dollars ($24,000,000) per occurrence.

(c) Required Insurance for TRMC’s Marine Carriers . TRMC shall cause all marine carriers who will access the Avon Terminal on its behalf to maintain insurance coverage as set forth below:

(i) Hull & Machinery . Hull and Machinery Insurance to the greater of the full market value or mortgage value of each vessel and her equipment used in performing services hereunder. Such insurance shall be endorsed to include navigation limits sufficient to cover all work locations and collision and tower’s liability with the Sistership Clause unamended.

(ii) Protection & Indemnity . Protection and Indemnity Insurance provided through any combination of (1) full entry with a Protection and Indemnity Club; and/or (2) policy(ies) with a commercial insurance company(ies) or underwriters syndicate(s) with terms no less broad than those customarily carried by similar marine carriers with a limit of not less than one billion dollars ($1,000,000,000). Such Protection and Indemnity insurance shall include coverage for injury to or death of master, mates, and crew; tower’s liability; excess collision liability; cargo legal liability; pollution liability; and contractual liability.

(iii) Certificate of Financial Responsibility (Water Pollution) . Marine carriers are required to provide to Operator a current and valid Certificate of Financial Responsibility (Water Pollution) for its vessel(s) and as required by a Terminal Service Order prior to arrival at the Avon Terminal. Evidence of all required insurance coverages for marine carriers must be received by Operator’s marine scheduler before approval to berth at the Avon Terminal will be granted or before authorization to enter the Avon Terminal area will be given, whichever is earlier.

(d) Certificates of Insurance; Endorsements . Excluding insurance for TRMC’s marine carriers, TRMC shall cause the Operator Group (as defined above) to be named as an additional insured on all policies of insurance secured by TRMC and the members of the TRMC Group in accordance with this Agreement. TRMC shall furnish Operator with certificates of insurance evidencing this coverage. All policies shall be endorsed to provide that no material change or cancellation of the coverage shall occur until Operator has received thirty (30) days written notice. TRMC hereby waives, and shall cause its insurers and those of the TRMC Insurance Group to also waive any right of subrogation that they may have against the Operator or the Operator Group. All insurance coverage required hereunder shall be primary to, and not in excess of or contributory with, any insurance that may be maintained by Operator.

(e) Self-Insurance . Subject to Operator’s review and approval, which will not be unreasonably withheld, TRMC may self-insure the Commercial General Liability Insurance requirements set forth in Section 23(b)(iv) . Operator reserves the right, at Operator’s discretion, to periodically review TRMC’s financial means to meet the TRMC Insurance Group insurance requirements included herein by self-insurance. If Operator reasonably determines that TRMC cannot meet the insurance obligations included herein by self-insurance, Operator may require TRMC to obtain and maintain insurance coverages for

requirements as provided in this Section 23 with insurance companies rated not less than A-, IX by A.M. Best or otherwise reasonably satisfactory to Operator. The self-insurance shall protect the indemnified parties in the same manner and to the same extent as they would have been protected had the policy or policies not been self-insured, contained a self-insured retention or deductible.


SECTION 24	NOTICE

All notices, requests, demands, and other communications hereunder will be in writing and will be deemed to have been duly given: (a) if by transmission by hand delivery, when delivered; (b) if mailed via the official governmental mail system, five (5) Business Days after mailing, provided said notice is sent first class, postage pre-paid, via certified or registered mail, with a return receipt requested; (c) if mailed by an internationally recognized overnight express mail service such as Federal Express, UPS, or DHL Worldwide, one (1) Business Day after deposit therewith prepaid; or (d) if by e-mail, one Business Day after delivery with receipt confirmed. All notices will be addressed to the Parties at the respective addresses as follows:

If to TRMC, to:

Tesoro Refining & Marketing Company LLC

19100 Ridgewood Parkway

San Antonio, Texas 78259

For legal notices :

Attention: General Counsel

If to Operator, to:

Tesoro Logistics Operations LLC

19100 Ridgewood Parkway

San Antonio, Texas 78259

For legal notices :

Attention: General Counsel

For all other notices and communications :

Attention: Don J. Sorensen, Vice President, Operations

phone: (210) 626-6195

email: Don.J.Sorensen@tsocorp.com

or to such other address or to such other Person as either Party will have last designated by notice to the other Party.


SECTION 25	REPORTS AND AUDIT

Each Party and its duly authorized agents and/or representatives shall have reasonable access to the accounting records and other documents maintained by the other Party which relate to this Agreement, and shall have the right to audit such records at any reasonable time or times during the Term and for a period of up to three (3) years after termination of this Agreement. Claims as to shortage in quantity or defects in quality shall be made by written notice within ninety (90) days after the delivery in question or shall be deemed to have been waived.


SECTION 26	CONFIDENTIAL INFORMATION

(a) Confidential Information and Exceptions Thereto . Each Party shall use reasonable efforts to retain the other Parties’ Confidential Information in confidence and not disclose the same to any third party nor use the same, except as authorized by the disclosing Party in writing or as expressly permitted in this Section 26 . Each Party further agrees to take the same care with the other Party’s Confidential Information as it does with its own, but in no event less than a reasonable degree of care. Excepted from these obligations of confidence and non-use is that information which:

(i) is available, or becomes available, to the general public without fault of the receiving Party;

(ii) was in the possession of the receiving Party on a non-confidential basis prior to receipt of the same from the disclosing Party (it being understood, for the avoidance of doubt, that this exception shall not apply to information of Operator that was in the possession of TRMC or any of its affiliates as a result of their ownership or operation of the Avon Terminal prior to the Commencement Date);

(iv) is independently developed by the receiving Party without reference to or use of the disclosing Party’s Confidential Information.

For the purpose of this Section 26 , a specific item of Confidential Information shall not be deemed to be within the foregoing exceptions merely because it is embraced by, or underlies, more general information in the public domain or in the possession of the receiving Party.

(b) Required Disclosure . Notwithstanding Section 26(a) above, if the receiving Party becomes legally compelled to disclose the Confidential Information by a court, Governmental Authority or Applicable Law, or is required to disclose by the listing standards of any applicable securities exchange, any of the disclosing Party’s Confidential Information, the receiving Party shall promptly advise the disclosing Party of such requirement to disclose Confidential Information as soon as the receiving Party becomes aware that such a requirement to disclose might become effective, in order that, where possible, the disclosing Party may seek a protective order or such other remedy as the disclosing Party may consider appropriate in the circumstances. The receiving Party shall disclose only that portion of the disclosing Party’s Confidential Information that it is required to disclose and shall cooperate with the disclosing Party in allowing the disclosing Party to obtain such protective order or other relief.

(c) Return of Confidential Information . Upon written request by the disclosing Party, all of the disclosing Party’s Confidential Information in whatever form shall be returned to the disclosing Party upon termination of this Agreement or destroyed with destruction certified by the receiving Party, without the receiving Party retaining copies thereof except that one copy of all such Confidential Information may be retained by a Party’s legal department solely to the extent that such Party is required to keep a copy of such Confidential Information pursuant to Applicable Law, and the receiving Party shall be entitled to retain any Confidential Information in the electronic form or stored on automatic computer back-up archiving systems during the period such backup or archived materials are retained under such Party’s customary procedures and policies; provided, however, that any Confidential Information retained by the receiving Party shall be maintained subject to confidentiality pursuant to the terms of this Section 26 , and such archived or back-up Confidential Information shall not be accessed except as required by Applicable Law.

(d) Receiving Party Personnel . The receiving Party will limit access to the Confidential Information of the disclosing Party to those of its employees, attorneys and contractors that have a need to

know such information in order for the receiving Party to exercise or perform its rights and obligations under this Agreement (the “ Receiving Party Personnel ”). The Receiving Party Personnel who have access to any Confidential Information of the disclosing Party will be made aware of the confidentiality provision of this Agreement, and will be required to abide by the terms thereof. Any third party contractors that are given access to Confidential Information of a disclosing Party pursuant to the terms hereof shall be required to sign a written agreement pursuant to which such Receiving Party Personnel agree to be bound by the provisions of this Agreement, which written agreement will expressly state that it is enforceable against such Receiving Party Personnel by the disclosing Party.

(e) Survival . The provisions of this Section 26 shall survive the termination of this Agreement for two (2) years.


SECTION 27	SAFE BERTH

Operator shall exercise due diligence to provide a berth which the nominated Marine Vessels accepted by the Operator can safely reach and leave and at which the Marine Vessel can lie, load, and discharge always safely afloat; provided however, Operator makes no representation or warranty regarding the safety of any channel, anchorage or other waterway used in approaching or departing from the designated berth. It is understood that, per the Master Lease, Operator does not maintain the berthing depth; however, Operator shall ensure that TRMC and any of TRMC’s accepted Marine Vessels are immediately notified of any changes in water depth that affect the stated draft maximum at mean lower low water as set forth in an applicable Terminal Service Order.


SECTION 28	MISCELLANEOUS

(a) Modification; Waiver . This Agreement may be amended or modified only by a written instrument executed by the Parties. Any of the terms and conditions of this Agreement may be waived in writing at any time by the Party entitled to the benefits thereof. No waiver of any of the terms and conditions of this Agreement will be effective unless in writing signed by a duly authorized individual on behalf of the Party against which the waiver is sought to be enforced. No waiver of any term or condition or of any breach of this Agreement will be deemed or will constitute a waiver of any other term or condition or of any later breach (whether or not similar), nor will such waiver constitute a continuing waiver unless otherwise expressly provided.

(b) Entire Agreement . This Agreement, together with the Exhibits and Terminal Service Orders and the other agreements executed or to be executed in connection with the transactions contemplated by the Contribution Agreement, constitutes the entire agreement among the Parties pertaining to the subject matter hereof and supersedes all prior agreements and understandings of the Parties in connection therewith. In the event of a conflict of provisions of this Agreement and the Omnibus Agreement, the provisions of the Omnibus Agreement shall prevail with respect to issues related to the contribution of the assets described therein, but not with respect to the ordinary operations of such assets as set forth in this Agreement.

(c) Construction and Interpretation . In interpreting this Agreement, unless the context expressly requires otherwise, all of the following apply to the interpretation of this Agreement:

(i) Preparation of this Agreement has been a joint effort of the Parties and the resulting Agreement against one of the Parties as the drafting Party.

(ii) Plural and singular words each include the other.

(iii) Masculine, feminine and neutral genders each include the others.

(iv) The word “or” is not exclusive and includes “and/or.”

(v) The words “includes” and “including” are not limiting.

(vi) References to the Parties include their respective successors and permitted assignees.

(d) Governing Law; Jurisdiction . This Agreement shall be governed by the laws of the State of Texas without giving effect to its conflict of laws principles; provided that any issues or claims arising out of the terms and conditions of the Master Lease, or rules and regulations of the California State Lands Commission will be governed by the laws of the State of California. Each Party hereby irrevocably submits to the exclusive jurisdiction of any federal court of competent jurisdiction situated in the United States District Court for the Western District of Texas, San Antonio Division, or if such federal court declines to exercise or does not have jurisdiction, in the District Court of Bexar County, Texas. The Parties expressly and irrevocably submit to the jurisdiction of said courts and irrevocably waive any objection which they may now or hereafter have to the laying of venue of any action, suit or proceeding arising out of or relating to this agreement brought in such courts, irrevocably waive any claim that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum and further irrevocably waive the right to object, with respect to such claim, action, suit or proceeding brought in any such court, that such court does not have jurisdiction over such Party. The Parties hereby irrevocably consent to the service of process by registered mail, postage prepaid, or by personal service within or without the State of Texas. Nothing contained herein shall affect the right to serve process in any manner permitted by law.

(e) Counterparts . This Agreement may be executed in one or more counterparts (including by facsimile or portable document format (pdf)) for the convenience of the Parties hereto, each of which counterparts will be deemed an original, but all of which counterparts together will constitute one and the same agreement.

(f) Severability . Whenever possible, each provision of this Agreement will be interpreted in such manner as to be valid and effective under applicable law, but if any provision of this Agreement or the application of any such provision to any Person or circumstance will be held invalid, illegal or unenforceable in any respect by a court of competent jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision hereof, and the Parties will negotiate in good faith with a view to substitute for such provision a suitable and equitable solution in order to carry out, so far as may be valid and enforceable, the intent and purpose of such invalid, illegal or unenforceable provision.

(g) Independent Contractor . Operator’s relationship to TRMC hereunder shall be that of an independent contractor. Nothing in this Agreement shall be construed to make Operator or any of its employees, an agent, associate, joint venturer or partner of TRMC.

(h) No Public Use . Operator’s services hereunder shall not be deemed those of a public utility or common carrier. If any action is taken or threatened to declare these services a public use, then, upon notifying TRMC, Operator may restructure and restate this Agreement.

(i) No Bonded Services . Operator is not providing a U.S. Customs bonded warehouse service.

(j) No Third Party Beneficiaries . Except as expressly set forth herein, including as set forth in Section 19 , it is expressly understood that the provisions of this Agreement do not impart enforceable rights in anyone who is not a Party or successor or permitted assignee of a Party.

(k) WAIVER OF JURY TRIAL . EACH PARTY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY PROCEEDINGS RELATING TO THIS AGREEMENT OR ANY PERFORMANCE OF OR FAILURE TO PERFORM ANY OBLIGATION HEREUNDER.

[Signature Page Follows]

IN WITNESS WHEREOF , the Parties hereto have duly executed this Agreement, effective as of the Commencement Date.



	TESORO LOGISTICS OPERATIONS LLC


	By:	/s/ Phillip M. Anderson
		Phillip M. Anderson
		President


	Solely in respect of Section 22 only:
	TESORO LOGISTICS LP
	By:	TESORO LOGISTICS GP, LLC
		its general partner

	By:	/s/ Phillip M. Anderson
		Phillip M. Anderson
		President

	Solely in respect of Section 22 only:
	TESORO LOGISTICS GP, LLC

	By:	/s/ Phillip M. Anderson
		Phillip M. Anderson
		President


	TESORO REFINING & MARKETING COMPANY LLC

	By:	/s/ Gregory J. Goff
		Gregory J. Goff
		Chairman of the Board of Managers and President

Signature Page to Avon Marine Terminal Operating Agreement

EXHIBIT 1

FORM OF TERMINAL SERVICE ORDER

(AVON TERMINAL [ ]- ___, 20__)

This Terminal Service Order is entered as of______ ___, 20__, by and between Tesoro Refining & Marketing Company LLC, a Delaware limited liability company, and Tesoro Logistics Operations LLC, a Delaware limited liability company, pursuant to and in accordance with the terms of the Avon Marine Terminal Operating Agreement dated as of November 21, 2016, by and among such parties and Tesoro Logistics GP, LLC, a Delaware limited liability company, and Tesoro Logistics LP, a Delaware limited partnership (the “ Agreement ”).

Capitalized terms not otherwise defined herein shall have the meaning set forth in the Agreement.

Pursuant to Section 9 of the Agreement, the parties hereto agree to the following provisions:

[Insert applicable provisions:

(i) the rules and procedures for the Avon Terminal referenced in Section 2 ;


(ii)	the per Barrel throughput fees at the Avon Terminal;


(iii)	the grades and approximate qualities of Products pursuant to Section 10(a)(iii) ;


(iv)	specifics of dock operations as referenced in Sections 14 and 27 ;

(v) any other calculation methods and procedures applicable to the OCR; and


(vi)	any other services as may be agreed.]

Except as set forth in this Terminal Service Order, the other terms of the Agreement shall continue in full force and effect and shall apply to the terms of this Terminal Service Order.

[Signature Page Follows]

Exhibit 1 -

Avon Marine Terminal Operating Agreement

IN WITNESS WHEREOF , the parties hereto have duly executed this Terminal Service Order as of the date first written above.




TESORO LOGISTICS OPERATIONS LLC		TESORO REFINING & MARKETING COMPANY LLC
TESORO LOGISTICS OPERATIONS LLC		TESORO REFINING & MARKETING COMPANY LLC

By:		By:
	Phillip M. Anderson		Cynthia J. Warner
	President		Executive Vice President-Operations

Exhibit 1 -

Avon Marine Terminal Operating Agreement

Exhibit 10.5

AMENDMENT NO. 3 TO SECONDMENT AND LOGISTICS SERVICES AGREEMENT

THIS AMENDMENT NO. 3 TO SECONDMENT AND LOGISTICS SERVICES AGREEMENT (this “ Amendment ”), dated as of November 21, 2016, is made and entered into by and among Tesoro Companies, Inc., a Delaware corporation (“ TCI ”), Tesoro Refining & Marketing Company LLC, a Delaware limited liability company (“ TRMC ”), Tesoro Alaska Company LLC, a Delaware limited liability company (“ TAC ” and, together with TCI and TRMC, the “ Tesoro Group ”), Tesoro Logistics GP, LLC, a Delaware limited liability company (the “ General Partner ”), Tesoro Logistics Operations LLC, a Delaware limited liability company (“ TLO ”), Tesoro Logistics Pipelines LLC, a Delaware limited liability company (“ TLP ”), Tesoro High Plains Pipeline Company LLC, a Delaware limited liability company (“ THPPC ”), Tesoro Logistics Northwest Pipeline LLC, a Delaware limited liability company (“ TLNP ”), and Tesoro Alaska Pipeline Company LLC, a Delaware limited liability company (“ TAPC ” and together with the General Partner, TLO, TLP, THPPC and TLNP, the “ Logistics Group ”). Each of TCI, TRMC, TAC, the General Partner, TLO, TLP, THPPC, TLNP and TAPC is referred to herein as a “ Party ” and collectively as the “ Parties .”

RECITALS

WHEREAS , as of July 1, 2014, the Parties entered into that certain Secondment and Logistics Services Agreement, as amended by Amendment No. 1 to Secondment Logistics and Services Agreement, dated as of December 2, 2014, and as further amended by Amendment No. 2 to Secondment Logistics and Services Agreement, dated as of March 31, 2016 (collectively, the “ Original Agreement ”), pursuant to which the Tesoro Group provides certain services and seconds certain of their personnel to the General Partner, the General Partner seconds certain of its personnel to the Tesoro Group and certain other services are provided by the Tesoro Group to the Logistics Group; and

WHEREAS , the Parties desire to further amend the Original Agreement as of the date hereof as hereinafter provided in this Amendment;

NOW, THEREFORE , in consideration of the premises and the mutual covenants and agreements contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

1. Amendment of Section 4(a) . Section 4(a) of the Original Agreement is hereby amended and restated in its entirety as follows:

(a) Materials, Equipment and Supplies . Either Party may supply or provide contract labor, materials, equipment and supplies (collectively “ Work ”) associated with Logistics Services or Tesoro Services. In addition, a Party may incur costs and expenses relating to permits, licenses, utilities, communications, consultants, security, and similar matters that are related to Logistics Services or Tesoro Services. Where applicable and agreed upon among the affected Parties, such Work may be provided by a third party under such third party’s contract with one Party for the benefit and account of another Party hereto, such that a contract entered into by a member of the Tesoro Group may cover Work provided for the account and benefit of a member of the Logistics Group, and vice versa. In such instances, the Party named in the applicable contract shall administer the Work being performed under the contract as a representative of the Party for whose account and benefit the Work is being performed, and the management and supervision of such Work shall be by the Party for whose account and benefit the Work is being performed, with employees responsible for such management and supervision being seconded, as otherwise provided herein. The Work must be approved by a person who has the authority delegated to approve the nature of the Work and the allocated costs and expenses of providing such items on behalf of the Party for whose account and benefit the Work is being performed, in accordance with the applicable policies and procedures of such Party. The Parties shall establish procedures

whereby the costs and expenses of providing such items are allocated to and paid by the Parties in accordance with the extent to which each Party realizes the benefit of each such item. If one Party incurs the expense for any such item that is used solely for the benefit of another Party, then the Party pays for such item shall be entitled to reimbursement from the Party who received the benefit for the costs and expenses so incurred such items. If any items benefit both the Tesoro Group and the Logistics Group, then the Group who incurs the costs and expenses associated with such items shall be entitled to reimbursement from the other Group in proportion to the benefits received by each Group from the incurrence of such costs and expenses. The Parties shall negotiate such allocations in good faith with relation to each such item at the time the reimbursement is determined. For items that are associated with Operational Expenses, the allocation may be included in the flat monthly fees reflected on the Service Schedules.

2. No Other Amendment . Other than as set forth above, the Original Agreement, as amended and supplemented to date, shall remain in full force and effect as written.

3. Governing Law . This Amendment shall be governed by and shall be construed in accordance with the laws of the State of Texas without regard to principles of conflict of law.

4. Counterparts . This Amendment may be executed in any number of counterparts with the same effect as if all signatory parties had signed the same document. All counterparts shall be construed together and shall constitute one and the same instrument. Delivery of an executed signature page of this Amendment by facsimile or in portable document format (.pdf) shall be effective as delivery of a manually executed counterpart hereof.

5. Binding Effect; Severability . This Amendment shall be binding upon and shall inure to the benefit of the parties hereto, their respective heirs, legal representatives, successors and assigns. Should any clause, sentence, paragraph, subsection or section of this Amendment be judicially declared to be invalid, unenforceable or void, such decision will not have the effect of invalidating or voiding the remainder of this Amendment, and the part or parts of this Amendment so held to be invalid, unenforceable or void will be deemed to have been stricken herefrom, and the remainder will have the same force and effectiveness as if such stricken part or parts had never been included herein.

6. No Other Agreement . This Amendment sets forth all of the covenants, agreements, conditions and understandings of the Parties relative to the subject matter hereof, and any previous agreement among such parties with respect to the subject matter hereof is superseded by this Amendment.

[ Signature Page Follows ]

81895095

IN WITNESS WHEREOF , the Parties hereto have duly executed this Agreement as of the date first written above.



GENERAL PARTNER : TESORO LOGISTICS GP, LLC By: /s/ Phillip M. Anderson Name: Phillip M. Anderson Title: President	LOGISTICS GROUP : TESORO LOGISTICS OPERATIONS LLC TESORO LOGISTICS PIPELINES LLC TESORO HIGH PLAINS PIPELINE COMPANY LLC TESORO LOGISTICS NORTHWEST PIPELINE LLC TESORO ALASKA PIPELINE COMPANY LLC By: /s/ Phillip M. Anderson Name: Phillip M. Anderson Title: President
TESORO GROUP : TESORO ALASKA COMPANY LLC TESORO REFINING & MARKETING COMPANY LLC By: /s/ Gregory J. Goff Name: Gregory J. Goff Title: Chairman of the Board of Managers and President TESORO COMPANIES, INC. By: /s/ Gregory J. Goff Name: Gregory J. Goff Title: Chairman of the Board of Directors and President

[ Signature Page to Amendment No. 3 to Secondment and Logistics Services Agreement ]

Exhibit 10.6

SUBLEASE

This Sublease (“ Sublease ”), dated as of the ___ day of _________, 20__, is made by and between Tesoro Refining & Marketing Company LLC, a Delaware limited liability company (“ Sublessor ”), and Tesoro Logistics Operations LLC, a Delaware limited liability company (“ Sublessee ”) with reference to the following:

A. Sublessor is the current tenant under that certain General Lease – Industrial Use, dated January 1, 2015 (the “ Master Lease ”), between Sublessor and the State of California, acting by and through the California State Lands Commission (“ Master Landlord ”), covering the property in Contra Costa County, California described in Exhibit A to the Master Lease (the “ Premises ”).

B. Sublessor is the owner of certain leasehold improvements located on the Premises and used in connection with the operation of the Premises, including, without limitation, the items identified on Exhibit B attached hereto (the “ Current Leasehold Improvements ”).

C. Sublessee desires to sublease the Premises from Sublessor, and Sublessor desires to sublease the Premises to Sublessee on the terms set forth in this Sublease.

D. Concurrently herewith, Sublessor and Sublessee have entered into that certain Avon Marine Terminal Use and Throughput Agreement (the “ Avon MTUTA ”).

NOW , THEREFORE , for good and valuable consideration, the receipt and sufficiency of which the parties acknowledge, Sublessor and Sublessee agree as follows:

1. Sublease of Premises . Sublessor hereby subleases the Premises to Sublessee, and Sublessee hereby subleases the Premises from Sublessor.

2. Term . The term of this Sublease (the “ Term ”) shall commence on the date hereof (“ Commencement Date ”) and shall expire concurrently with the expiration of the Master Lease.

3. Incorporation of Terms of Master Lease . Sublessee hereby acknowledges that it has read and is familiar with the provisions of the Master Lease and agrees that this Sublease is and shall remain in all respects subordinate to and subject to the Master Lease and any amendments, modifications or supplements to the Master Lease hereafter made. The terms, provisions, covenants, stipulations, conditions, rights, obligations, remedies and agreements contained in the Master Lease are incorporated herein by reference and are made a part hereof, and shall, as between Sublessor and Sublessee (as if Sublessor were the lessor under the Master Lease and Sublessee were the lessee under the Master Lease) constitute the terms of this Sublease. Sublessee hereby agrees to perform and comply with, for the benefit of Sublessor and Master Landlord, the obligations of the lessee under the Master Lease with respect to the Premises during the Term of this Sublease. Without limiting the foregoing:

(a) Sublessee shall make payment of all rent due under the Master Lease as and when required to be paid pursuant to the Master Lease. Such payment shall be made by Sublessee directly to Master Landlord, with concurrent notice thereof to Sublessor.

(b) Sublessee shall be responsible for paying required costs of maintenance and improvements as required under the Master Lease. Any capital expenditure required by the Master Lease shall be made by Sublessee.

(c) Sublessee shall be responsible for maintaining all of the insurance required of the tenant under the Master Lease, endorsed to name Master Landlord and Sublessor as additional insureds. In addition, Sublessee shall obtain and keep in force a policy of excess liability coverage with a liability limit of $500,000,000, including coverage for pollution events, and all such insurance shall be endorsed to name Sublessor as an additional insured. Up to $100,000,000 of such insurance shall also be endorsed to name Master Landlord as an additional insured.

(d) Sublessee will operate the Premises in accordance with all legal and regulatory requirements.

(e) Sublessee shall be responsible for complying with the obligations of the tenant under the Master Lease with respect to hazardous materials, subject to any reimbursement or other indemnification obligations of Sublessor to Sublessee under any other agreements between Sublessor and Sublessee.

4. Default . “Default” under this Sublease shall occur if either party shall fail to perform any of its material obligations hereunder (except when such failure shall be excused under other provisions hereof). Upon such default, the non-defaulting party shall have the option to terminate this Sublease as follows: (i) the non-defaulting party shall give written notice to the defaulting party stating specifically the default or breach relied upon by the non-defaulting party as justifying termination hereof. If said default or breach is not remedied within thirty (30) days after receipt of notice, if therein remediable, or if the defaulting party fails to commence promptly and attempt diligently to remedy the same where said default or breach is not remediable within thirty (30) days after receipt of said written notice, the non-defaulting party shall have the right to terminate this Sublease. If within such thirty (30) day period the defaulting party does remedy the default or breach, or commences promptly and attempts diligently to remedy or remove the same where not remediable within such thirty (30) day period, and fully indemnifies the non-defaulting party from any and all loss and liability resulting directly from such default or breach, the notice shall be withdrawn and this Sublease shall continue in full force and effect.

5. Leasehold Improvements .

(a) Effective upon the Commencement Date, Sublessor shall convey to Sublessee ownership of all of the Current Leasehold Improvements located on the Premises and owned by Sublessor as of the Commencement Date. Such conveyance shall be “as is” without representations or warranties of any kind whatsoever, express, implied or statutory, except as otherwise set forth in that certain Contribution, Conveyance and Assumption Agreement, dated November 21, 2016, between Sublessor, Sublessee and other parties. Concurrently with the execution of this Sublease, Sublessor shall execute and deliver to Sublessee a bill of sale to the Current Leasehold Improvements in the form attached hereto as Exhibit B (the “ Bill of Sale ”). In the event of a termination of this Sublease by reason of a default on the part of Sublessee, the Current Leasehold Improvements, together with any other leasehold improvements made subsequent to the Commencement Date (“ Future Leasehold Improvements ”; the Current Leasehold Improvements and the Future Leasehold Improvements being sometimes collectively referred to herein as the “ Leasehold Improvements ”), shall automatically become the property of Sublessor. In the event of an early termination of this Sublease not due to the fault of Sublessee, all such Leasehold Improvements shall be conveyed by Sublessee to Sublessor and Sublessor shall pay to Sublessee the fair market value of the Leasehold Improvements valued as of the date of termination and with fair market value calculated as provided below. In order to effect such conveyance (or, at Sublessor’s option in the event of a termination for Sublessee’s default, to confirm the ownership of such improvements), Sublessee shall take such actions and execute such documents as Sublessor may reasonably require, including, without limitation, execution of a bill of sale for such improvements. If Sublessee fails or refuses to execute such documents or take such actions, Sublessee hereby appoints Sublessor as its attorney-in-fact with authority to execute such documents and take such actions, which appointment is coupled with an interest and is irrevocable.

(b) Fair Market Value : The fair market value of the Leasehold Improvements shall be reasonably determined by Sublessor with such determination based on information regarding, without limitation, the nature of the particular Leasehold Improvement, its age and functionality, and the current sale price of similar improvements in the same industry, all as valued for their highest and best use at the time of termination of the Sublease. Sublessor shall provide Sublessee with written notice of the determination of the fair market value of the Leasehold Improvements within thirty (30) days after the termination of this Sublease. If Sublessee disagrees with Sublessor’s determination of the fair market value, and the parties cannot mutually agree upon the fair market value within twenty (20) days after the expiration of the thirty (30) day notice period, then the fair market value shall be determined by appraisal in the manner set forth below:

(i) The fair market value of the Leasehold Improvements shall be appraised by an appraiser with at least ten (10) years’ experience in the oil and gas appraisal sector chosen by Sublessor (“ First Appraisal ”) and the appraisal report forwarded to Sublessee. If the First Appraisal is deemed unacceptable by Sublessee, then Sublessee shall so advise Sublessor in writing within ten (10) working days after receipt of the First Appraisal and Sublessee shall have the right to engage an appraiser with at least ten (10) years’ experience in the oil and gas appraisal sector to appraise the Leasehold Improvements (“ Second Appraisal ”) and the appraisal report forwarded to Sublessor. In the event Sublessor shall deem the Second Appraisal to be unacceptable,

then Sublessor shall advise Sublessee within ten (10) working days after receipt of the Second Appraisal, and the first appraiser and second appraiser shall together choose a third appraiser with at least ten (10) years’ experience in the oil and gas appraisal sector who shall appraise the Leasehold Improvements (“ Third Appraisal ”) and forward the appraisal report to Sublessor and Sublessee. The cost of the First Appraisal shall be borne by Sublessor, and the cost of the Second Appraisal shall be borne by Sublessee. The cost of the Third Appraisal shall be shared equally between Sublessor and Sublessee. The fair market value for the Leasehold Improvements shall be the average of the two (2) closest appraisals. Each of the appraisers shall appraise the Leasehold Improvements for their highest and best use.

6. Rent Negotiations . Sublessee shall conduct the rent negotiations required by Section 5 of the Master Lease. Sublessor shall have the right to approve the negotiated rent, which approval shall not be unreasonably withheld. When the compensation has been adjusted, Sublessee shall pay the same.

7. Removal and Restoration Obligations . To the extent the Master Lease requires removal of leasehold improvements and restoration of the Premises at the end of the Master Lease term, Sublessee shall be responsible for such removal and restoration. Further, in the event this Sublease is terminated by reason of Sublessee’s default hereunder within the thirty-six month (36) period prior to expiration of the Master Lease term, Sublessee shall be responsible, in addition to all other damages arising from such default, for the cost incurred by Sublessor in effecting the removal and restoration required under the Master Lease.

8. Cross-Defaults . A default under this Sublease shall constitute a default under the Avon MTUTA, and a default under the Avon MTUTA shall constitute a default under this Sublease. Without limitation on the generality of the foregoing, if the Avon MTUTA is terminated by reason of a default by Sublessee, Sublessor shall have the right to terminate this Sublease by written notice to Sublessee.

9. Early Right of Termination . If at any time following the termination or expiration of the MTUTA, Sublessee desires to cease the conduct of operations from the Premises, Sublessee shall have the right to deliver to Sublessor a notice of such intent at least ninety (90) days prior to the intended date on which operations will cease, and Sublessor shall have the right, but not the obligation, to terminate this Sublease by delivering written notice to Sublessee. If Sublessor has not made such election prior to the date of such cessation of operations, Sublessor shall continue to have the right to terminate this Sublease at any time after Sublessee ceases operations and before Sublessee recommences operations from the Premises, to terminate this Sublease by delivering written notice to Sublessee. Unless and until Sublessee has given the foregoing notice to Sublessor of its intent to cease operations from the Premises, Sublessee shall continuously operate from the Premises to an extent reasonably consistent with prior operations from the Premises by Sublessor, and a failure of Sublessee to so operate, unless such failure is a result of casualty or other force majeure event, shall constitute a default on the part of Sublessee.

10. Amendments to Master Lease . Sublessee shall have the right to seek amendments to the terms of the Master Lease, which amendments shall be subject to Sublessor’s consent, which consent shall not be unreasonably withheld, conditioned or delayed. In the event

of any such amendment, Sublessee shall be responsible for complying with the amended terms of the Master Lease, and Sublessee shall indemnify, defend and hold Sublessor harmless from and against any loss, cost or liability arising as a result of such amendment. Notwithstanding the foregoing, Sublessor shall have no obligation to consent to an amendment of the Master Lease (i) that extends the term of the Master Lease unless Sublessor is released from all further liability under the Master Lease as of the date on which the Master Lease would otherwise have expired, or (ii) that increases the rent or other obligations of the tenant under the Master Lease unless Sublessor is relieved of liability for the increased rent or other obligations.

11. Master Lease Renewal . In the event Sublessor consummates a new master lease of the Premises following the expiration of the Master Lease, Sublessor shall negotiate in good faith with Sublessee for a new sublease based on the terms of the new master lease.

12. Counterparts . This Sublease may be signed by the parties in different counterparts and the signature pages combined to create one document binding on all parties.

[Signature Page Follows]

IN WITNESS WHEREOF, the parties have executed this Sublease as of the date first above written.



Sublessor : Tesoro Refining & Marketing Company LLC, a Delaware limited liability company By: Gregory J. Goff Chairman of the Board of Managers and President	Sublessee : Tesoro Logistics Operations LLC, a Delaware limited liability company By: Phillip M. Anderson President

Signature Page to Sublease

Exhibit A

Current Leasehold Improvements

All machinery and equipment, mobile or otherwise, systems and other tangible personal property owned and used by Sublessor primarily in connection with leasing or operation of the Premises, including (a) all production units, processing units and distillation systems, (b) all heating, lighting, and power systems, fire prevention and fire extinguishing systems, control systems, emergency warning and emergency preparedness systems and related assets, (c) all storage and other tanks, meters, pumps, engines, compressors, pipes, fittings, valves, connections, regulators, loading and unloading lines and racks, (d) all computers, servers, printers, computer hardware, wired or mobile telephones, on-site process control and automation systems, telecommunications assets, and other information-technology-related equipment that is used exclusively in connection with the Premises and that is owned by Sublessor or leased by Sublessor, (e) all tools, (f) all furniture and furnishings, (g) all vehicles and (h) all other tangible personal property, in each case presently owned by Sublessor, located in or on the Premises.

Exhibit B

Bill of Sale

FOR GOOD AND VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, the undersigned, Tesoro Refining & Marketing Company LLC, a Delaware limited liability company (“ TRMC ”), does hereby transfer and assign to Tesoro Logistics Operations LLC, a Delaware limited liability company (“ TLO ”), all of its right, title and interest, if any, in and to the leasehold improvements located on the Premises (as that term is defined in that certain Sublease dated ________ __, 20__, between TRMC, as sublessor, and TLO, as sublessee), including without limitation the items listed in Schedule 1 attached hereto, such transfer and assignment being on an “as is” basis, without any representations or warranties, express, implied or statutory, of any kind whatsoever, except as set forth in that certain Contribution, Conveyance and Assumption Agreement, dated November 21, 2016, between TRMC, TLO and other parties.

Dated: ________ __, 20__ Tesoro Refining & Marketing Company LLC,
a Delaware limited liability company

                        By:
                        Name:
                        Title:

SCHEDULE 1 TO BILL OF SALE

List of Current Leasehold Improvements to be Transferred from Sublessor to Sublessee

Exhibit 10.7

AVON MARINE TERMINAL USE AND THROUGHPUT AGREEMENT

This AVON MARINE TERMINAL USE AND THROUGHPUT AGREEMENT (the “ Agreement ”) is dated as of the Commencement Date (defined below in Section 1 ), by and between Tesoro Logistics Operations LLC, a Delaware limited liability company (“ Operator ”), and for purposes of Section 22(a) only, Tesoro Logistics GP, LLC, a Delaware limited liability company (“ General Partner ”) and Tesoro Logistics LP, a Delaware limited partnership (“ Partnership ”), on the one hand, and Tesoro Refining & Marketing Company LLC, a Delaware limited liability company (“ Customer ”), on the other hand.

RECITALS

WHEREAS , Customer is the current tenant under that certain General Lease – Industrial Use, dated January 1, 2015 (the “ Master Lease ”), between Customer and the State of California, acting by and through the California State Lands Commission, covering the property in Contra Costa County, California described in Exhibit A to the Master Lease (the “ Avon Terminal ”);

WHEREAS , concurrently herewith, Customer has entered into a Sublease (the “ Sublease ”) with Operator pursuant to which Customer has subleased the Avon Terminal to Operator and has transferred to Operator all of Customer's leasehold improvements located at the Avon Terminal;

WHEREAS , during the Term, Customer desires for Operator to provide the services set forth herein relating to the Avon Terminal in order to enable Customer to receive and ship Products to and from Marine Vessels and terminals and pipelines;

WHEREAS , Operator is willing to provide such services to Customer;

WHEREAS , the operation of the Avon Terminal by Operator under the Sublease will require a Certificate of Financial Responsibility (“ COFR ”) issued by the California Department of Fish and Game (“ CDFG ”) in favor of Operator; and

WHEREAS , Operator and Customer desire to enter into this Agreement to memorialize the foregoing and the terms of their commercial relationship regarding the Avon Terminal.

NOW , THEREFORE , in consideration of the covenants and obligations contained herein, the Parties (as defined below) to this Agreement hereby agree as follows:

Section 1 DEFINITIONS

Capitalized terms used throughout this Agreement shall have the meanings set forth below, unless otherwise specifically defined herein.

“ Agreement ” has the meaning set forth in the Preamble.

interconnection between the Avon Terminal and the Refinery facilities and the marine vapor recovery system located on or adjacent to the Avon Terminal, but excluding the vapor compression, recovery and destruction system operated by Customer at the Refinery, which is being used to provide services to the Avon Terminal.

“ API ” means the American Petroleum Institute.

“ Applicable Law ” means any applicable statute, law, regulation, ordinance, rule, determination, judgment, rule of law, order, decree, permit, approval, concession, grant, franchise, license, requirement, or any similar form of decision of, or any provision or condition of any permit, license or other operating authorization issued by any Governmental Authority having or asserting jurisdiction over the matter or matters in question, whether now or hereafter in effect.

“ ASTM ” means the American Society for Testing and Materials.

“ Avon Terminal ” has the meaning set forth in the Recitals.

“ Barrel ” means a volume equal to 42 U.S. gallons or 231 cubic inches, each at 60 degrees Fahrenheit under one atmosphere of pressure.

“ Base Fee ” means the per Barrel throughput fees at the Avon Terminal as set forth on a Terminal Service Order multiplied by the actual throughput by Customer across the Avon Terminal for the particular Month.

“ Business Day ” means a day, other than a Saturday or Sunday, on which banks in New York, New York are open for the general transaction of business.

“ CDFG ” has the meaning set forth in the Recitals.

“ Claims ” has the meaning set forth in Section 19(a) .

“ COFR ” has the meaning set forth in the Recitals.

“ Commencement Date ” means _________ __, 20__.

“ Contribution Agreement ” means that certain Contribution, Conveyance and Assumption Agreement, dated November 21, 2016, by and among Tesoro Corporation, Customer, the General Partner, the Partnership and Operator.

“ Customer ” has the meaning set forth in the Preamble.

“ Customer Group ” has the meaning set forth in Section 19(a) .

“ Customer Insurance Group ” has the meaning set forth in Section 23(b) .

“ Customer’s Percentage Allocation ” means Customer’s actual volumetric percentage utilization of the Avon Terminal as compared to the total volumetric utilization of the Avon Terminal for any calendar year.

“ Customer’s Proportionate Share of MPC ” has the meaning set forth in Section 7(a)(ii) .

“ Extension Period ” has the meaning set forth in Section 4 .

“ First Offer Period ” has the meaning set forth in Section 20(e) .

(i) strikes, picketing, lockouts or other industrial disputes or disturbances;

(v) epidemics or quarantine, explosions, breakage or accidents to equipment, machinery, plants, facilities or lines of pipe, or electric power, natural gas, or water shortages.

A Party’s inability economically to perform its obligations hereunder does not constitute an event of Force Majeure.

“ General Partner ” has the meaning set forth in the Preamble.

“ Initial Term ” has the meaning set forth in Section 4 .

“ Major Project Costs ” or “ MPC ” have the meanings set forth in Section 7(a)(i).

“ Marine Vessel ” means any ocean tanker, ocean barge, river barge or other vessel.

“ Master Lease ” has the meaning set forth in the Recitals.

“ Minimum Marine Throughput Volume ” means an aggregate volume of 892,500 Barrels of Products per Month throughput across the Avon Terminal; provided, however, that the Minimum Marine Throughput Commitment during the Month in which the Commencement Date occurs shall be prorated in accordance with the ratio of the number of days, including and following the Commencement Date, in such Month to the total number of days in such Month.

“ Month ” means the period commencing on the Commencement Date and ending on the last day of that calendar month and each successive calendar month thereafter.

“ MOTEMS ” means all state required Marine Oil Terminal and Maintenance Standards.

“ MTVF ” means a Monthly fee calculated by multiplying the Minimum Marine Throughput Volume by the per Barrel throughput fees at the Avon Terminal as set forth on a Terminal Service Order.

“ MVR Fee ” has the meaning set forth in Section 5(a)(ii) .

“ Obligation Cost Reimbursement ” or “ OCR ” have the meanings set forth in Section 6(b).

“ Omnibus Agreement ” means that certain Third Amended and Restated Omnibus Agreement, dated as of July 1, 2014, by and among Tesoro Corporation, Customer, Tesoro Companies, Inc., Tesoro Alaska Company LLC, the General Partner and the Partnership, as such agreement (and the schedules thereto) may be amended, supplemented or restated from time to time.

“ Operator ” has the meaning set forth in the Preamble.

“ Operator Group ” has the meaning set forth in Section 19(b) .

“ Partnership ” has the meaning set forth in the Preamble.

“ Partnership Change of Control ” means Tesoro Corporation ceases to Control the General Partner.

“ Party ” or “ Parties ” means that each of Operator and Customer is a “Party” and collectively are the “Parties” to this Agreement.

“ Product ” or “ Products ” means gasoline, gasoline blend component, diesel, distillate, distillate blend components, jet/aviation fuel, fuel oil, cut back resid, cutter stock, gas oil and/or other commodity other than crude oil specified in this Agreement or otherwise mutually agreed upon by the Parties.

“ Project Cost Reimbursements ” or “ PCR ” have the meanings set forth in Section 7(b)(ii) .

“ Receiving Party Personnel ” has the meaning set forth in Section 26(d) .

“ Refinery ” means Customer’s refinery located near Martinez in Contra Costa County, California, including without limitation, tanks owned and operated by Operator to provide services to Customer under separate agreements.

“ Regulatory Obligations ” means standards, regulations, permits or conditions required by a Governmental Authority.

“ Related Agreements ” means the Sublease and the Storage Services Agreement.

“ Right of First Refusal ” has the meaning set forth in Section 20(e ).

“ Secondment Agreement ” shall mean the Secondment and Logistics Services Agreement dated as of July 1, 2014, as amended, and related service orders.

“ Services ” has the meaning set forth in Section 13(a) .

“ Shortfall Credit ” has the meaning set forth in Section 9(b) .

“ Storage Services Agreement ” means that certain Martinez Storage Services Agreement, dated November 21, 2016, by and among Customer, Operator, the General Partner and the Partnership, as such agreement may be amended, restated, modified or supplemented from time to time.

“ Sublease ” has the meaning set forth in the Recitals.

“ Term ” has the meaning set forth in Section 4 .

“ Terminal Service Order ” has the meaning set forth in Section 9(a) .

that retains a beneficial use, including recycling, oil recovery and re-refining, is not Waste unless it is destined for disposal.

SECTION 2 GENERAL UNDERTAKINGS

Subject to the terms and conditions of this Agreement, Operator’s operating permits, the limitations of the Avon Terminal, the limitations of connecting carriers, the rules and procedures for the Avon Terminal set forth in Terminal Service Orders, and all Applicable Law, Operator shall provide throughput service for Customer’s Marine Vessels, subject to Avon Terminal availability as provided herein, and be compensated for such services pursuant to this Agreement. Each Month during the Term, Customer shall throughput across the Avon Terminal at least the Minimum Marine Throughput Commitment. Customer’s personnel shall be granted access to the Avon Terminal for the purpose of boarding and unboarding its Marine Vessels. For purposes of this Agreement, Customer’s Marine Vessels and personnel shall include those of Customer and/or its suppliers and trade partners accessing the Avon Terminal.

SECTION 3 RESERVED

SECTION 4 TERM

Commencing on the Commencement Date, the initial term of this agreement shall be for a period of ten (10) years until the tenth (10 ^th ) anniversary of the Commencement Date (the “ Initial Term ”), provided, however, that Customer may, at its sole option, extend the Initial Term for up to two (2) renewal terms of five (5) years each (each, an “ Extension Period ”) by providing written notice of its intent to Operator no less than twelve (12) Months prior to the end of the Initial Term or the then-current Extension Period. The Initial Term and any Extension Period shall be referred to herein as the “ Term ”.

SECTION 5 THROUGHPUT FEES

(a) Customer agrees to pay Operator:

(i) the higher of the Base Fee or the MTVF; and

(ii) a per Barrel use fee for marine vapor recovery throughput at the Avon Terminal (the “ MVR Fee ”), when applicable, as set forth in a Terminal Service Order .

(b) During any Month that the Avon Terminal is not available to receive any of Customer’s Marine Vessels on a day in which Customer’s Marine Vessel is scheduled to have access to the Avon Terminal, for any reason other than Customer’s actions or inactions, including without limitation, Operator’s actions or inactions or a Force Majeure affecting the Avon Terminal or the Ancillary Facilities, and such unavailability prevents Customer from throughputting the Minimum Marine Throughput Volume, the Minimum Marine Throughput Volume (and resulting MTVF) for such Month will be reduced as follows: the Minimum Marine Throughput Volume will be proportionally reduced in proportion to the number of days in such Month when Customer’s Marine Vessels were prevented from having access to the Avon Terminal as a result of the Avon Terminal being unavailable.

SECTION 6 PASS THROUGH AND REGULATORY OBLIGATION COST REIMBURSEMENTS

(a) During the Term, Customer agrees to pay or reimburse Operator for pass-through costs allocable to Customer’s shipments at the Avon Terminal as follows:

(i) Labor Services . Costs and expenses of any additional services not expressly covered by this Agreement which are requested by Customer and agreed to by Operator based on the rates set forth on a Terminal Service Order. In addition, Customer shall pay Operator for any materials used in the performance of such additional services in an amount equal to the cost of such materials, including without limitation chemicals and supplies used by Operator in providing such services.

(ii) Marine Terminal Fees . Customer shall pay, either directly or by reimbursement to Operator, all applicable third-party charges and related pass-through fees assessed to Operator, by any Governmental Authority, or by any other Persons that are related directly or indirectly to the throughput of Product across the Avon Terminal via Marine Vessel.

(iii) Shore Side Survey or Inspector Fees . Customer shall pay or reimburse Operator for one hundred percent (100%) of all shore side survey or inspector fees incurred and attributable to each Customer shipment across the Avon Terminal.

(b) Regulatory Obligation Cost Reimbursements . Customer will also pay Operator a Monthly regulatory obligation cost reimbursement (“ Obligation Cost Reimbursement ” or “ OCR ”) based on the throughput at the Avon Terminal, calculated as follows:

(i) The OCR shall equal the average of Customer’s Percentage Allocation at the Avon Terminal for the prior two calendar years multiplied by the amount, as reasonably determined by Operator, which is sufficient to reimburse Operator for the portion of Operator’s actual additional recurring costs incurred at the Avon Terminal after the Commencement Date attributable to Regulatory Obligations.

Before the start of each Contract Year, Operator will provide Customer with its projected OCR with respect to the Avon Terminal for such Contract Year, with all reasonable supporting documentation and back up in calculating the OCR. Pursuant to this Section 6 , such OCR shall be payable Monthly. Within ninety (90) days after the end of each Contract Year in which OCR is charged to Customer, Operator shall reconcile the projected OCR charged to and paid by Customer during such Contract Year with the actual additional operating costs incurred by Operator during such Contract Year and shall credit or debit Customer’s next recurring invoice according to such reconciliation.

(c) Taxes . All taxes (other than property taxes, ad valorem taxes, income taxes, gross receipt taxes, payroll taxes and other similar taxes) that Operator incurs on Customer’s behalf for services provided pursuant to this Agreement with respect to the Avon Terminal, shall be reimbursed by Customer unless prohibited by Applicable Law.

SECTION 7 MAJOR PROJECT COSTS AND PROJECT COST REIMBURSEMENTS.

(a) Major Project Costs . Customer shall reimburse Operator for Customer’s Proportionate Share of MPC for Major Project Costs incurred by Operator with respect to the Avon Terminal.

(i) “ MPC ” or “ Major Project Costs ” means those actual capital expenditures (whether capitalized or expensed by Operator for accounting or tax purposes) for major, non-recurring projects (each, a “ Project ”) involving a substantial change to the Avon Terminal, or access to such terminals, incurred by Operator after the Commencement Date, (1) applicable to Operator’s ownership or operation of the Avon Terminal under this Agreement and (2) attributable to Regulatory Obligations, including, without limitation, changes in MOTEMS standards, and/or similar regulatory or environmental operating expenses or capital expenses as a result of action by a Governmental Authority .

(ii) “ Customer’s Proportionate Share of MPC ” for a Project means the average of Customer’s Percentage Allocation with respect to the Avon Terminal for the two (2) calendar years before the year in which a Project is completed, in each case multiplied by the MPC for such Project. If needed, up to two (2) calendar years of actual throughput data prior to the Commencement Date year may be used to determine the average of Customer’s Percentage Allocation at the Avon Terminal for the two calendar years before the year in which a Project is completed. If, however, Customer’s Proportionate Share of MPC for a Project is to be paid for through PCR payments (as defined and pursuant to subparagraph 6(b)(ii) below), and during any calendar year there are cumulative changes in Customer’s Percentage Allocation in an amount greater than ten percent (10%), then the outstanding principal balance of Customer’s Proportionate Share of MPC will be adjusted up or down at the start of the next calendar year to correspond to the cumulative changes;

(iii) Operator shall provide Customer with reasonable supporting information and cost accounting for its expenses relating to the MPC and the basis for determining Customer’s Proportionate Share of MPC; provided that , Operator will not be required to divulge any information in violation of any applicable anti-competition laws, rules or regulations. Customer may audit such supporting documentation pursuant to the terms and conditions of Section 13 below.

(iv) Notwithstanding anything contained herein, Customer will have the right to review and consent to the scope, design or implementation of a Project; provided, however, (x) Operator will provide Customer regular updates of Project scope and design and obtain Customer consent to scope and cost at each stage of the Project design for all Projects with estimated cost in excess of $100,000, (y) Operator will provide Customer a written summary of any Project (including a +/-10% cost estimate for the Project) at least ninety (90) days prior to commencement of construction of the Project, and (z) Operator and Customer shall meet to discuss Customer’s Proportionate Share of MPC at least thirty (30) days prior to commencement of construction of the Project. Operator shall design and construct the Project in accordance with customary industry standards and the requirements of the applicable Governmental Authority.

(b) MPC Payment Methods . Customer shall pay Customer’s Proportionate Share of MPC for a Project as provided in Option 1 below; provided that Customer may elect to pay Customer’s Proportionate Share of MPC for a Project as provided in Option 2 below by giving Operator written notice of such election on or before the date Operator begins construction work on a Project:

(i) Option 1 : Customer shall pay Operator the Customer’s Proportionate Share of MPC in full upon completion of the applicable Project.

(ii) Option 2 : Customer shall pay Customer’s Proportionate Share of MPC in Monthly installments (the “ Project Cost Reimbursements ” or “ PCR ”) pursuant to the following conditions:

(1) The PCR payment obligation shall commence upon completion of the applicable Project, with the first PCR payment to be made in accordance with the first regular Monthly invoice delivered by Operator following completion of the Project.

(2) The outstanding principal balance of Customer’s Proportionate Share of MPC shall bear interest at the lesser of a per annum rate of LIBOR plus six percent (LIBOR + 6%) or the highest rate of interest (if any) permitted by Applicable Law, and shall be repaid in equal Monthly installments of principal and interest, with such payment to be based on the outstanding principal balance of Customer’s Proportionate Share of MPC amortized over (A) five (5) years, or (B) the number of years remaining in the term of this Agreement, whichever time period is shorter; provided , however , that if this Agreement is terminated, then the remaining unpaid principal balance of Customer’s Proportionate Share of MPC with respect to a Project will be due and payable by Customer upon the date of such termination; provided further , however , that Customer shall be entitled to a credit against such remaining unpaid principal balance equal to (X) the amount of any MPC that has not been paid prior to the termination date for which Customer will become responsible as lessee under the lease pursuant to which the MPC was incurred, and (Y) the amount of such MPC that Operator receives from any third party customer that would have been included within Customer’s Proportionate Share of MPC if this Agreement had not been so terminated.

SECTION 8 RESERVED

SECTION 9 TERMINAL SERVICE ORDERS; PAYMENTS

(a) Description . Operator and Customer shall enter into one or more terminal service orders for the Avon Terminal substantially in the form attached hereto as Exhibit 1 (each, a “ Terminal Service Order ”). Upon a request by Customer pursuant to this Agreement or as deemed necessary or appropriate by Operator in connection with the services to be delivered pursuant hereto, Operator shall generate a Terminal Service Order to set forth the specific terms and conditions for providing the applicable services described therein and the applicable fees to be charged for such services. No Terminal Service Order shall be effective until fully executed by both Operator and Customer. Items available for inclusion on a Terminal Service Order include, but are not limited to:

(i) the rules and procedures for the Avon Terminal referenced in Section 2 ;

(ii) the per Barrel throughput fees at the Avon Terminal;

(iii) any MVR Fee specified pursuant to Section 5(a)(ii) ;

(iv) the grades and approximate qualities of Products pursuant to Section 10(a)(iii) ;

(v) the specifics of operations as referenced in Sections 14 and 27 ;

(vi) any other calculation methods and procedures applicable to the MPC or the OCR; and

(vii) any other services as may be agreed.

(b) Monthly Shortfall Credit . If the Base Fee is less than the MTVF, then Customer shall receive a “ Shortfall Credit ” equal to such difference.

(c) Monthly Reconciliation . Actual volumes of Barrels throughput across the Avon Terminal are to be determined Monthly, based upon Marine Vessel deliveries and Marine Vessel receipts during that Month and credited towards the Minimum Marine Throughput Volume in such Month. A Marine Vessel’s cargo will apply to the Month in which loading and unloading is completed, provided that if a cargo is unable to be loaded or unloaded in the Month in which loading or unloading was scheduled due to the failure of Operator to perform as scheduled, then the Parties shall negotiate in good faith to determine the appropriate Month in which to credit receipt of such cargo. The Shortfall Credit shall be credited as follows:

(i) The dollar amount of any Shortfall Credit included in the Monthly invoice will be posted as a credit to Customer’s account and may be applied against amounts owed by Customer for volumes in excess of the Minimum Marine Throughput Volume during any of the succeeding three (3) Months; and

(ii) Any portion of the Shortfall Credit that is not used by Customer during the succeeding three (3) Months will expire at the end of said three (3) Month period relating to the respective credit and be reset to zero.

(d) Invoices . Except with respect to the MPC payment methods described in Section 7(b) , Operator shall invoice Customer on a Monthly basis and Customer shall pay all amounts due under this Agreement and any Terminal Service Order no later than ten (10) calendar days after Customer’s receipt of Operator’s invoices. Any past due payments owed by either Party shall accrue interest, payable on demand, at the lesser of (i) the rate of interest announced publicly by JPMorgan Chase Bank, in New York, New York, as JPMorgan Chase Bank’s prime rate (which Parties acknowledge and agree is announced by such bank and used by the Parties for reference purposes only and may not represent the lowest or best rate available to any of the customers of such bank or the Parties), plus four percent (4%), and (ii) the highest rate of interest (if any) permitted by Applicable Law, from the due date of the payment through the actual date of payment.

(e) Disputed Amounts . If Customer reasonably disputes any amount invoiced by Operator, Customer shall pay the amount of the invoice when due and provide Operator with written notice stating the nature of the dispute prior to thirty (30) days after the due date of the invoice. Customer and Operator shall use reasonable commercial diligence to resolve disputes in a timely manner through the dispute resolution procedures provide for herein. All portions of the disputed amount determined to be owed the Customer shall be refunded to the Customer within ten (10) days of the dispute resolution.

(f) Fee Increases . Any fees of a fixed amount set forth in this Agreement and any Terminal Service Order shall be increased on July 1 of each year of the Term, commencing on July 1, 2017, by a percentage equal to the greater of zero or the positive change, if any, in the CPI-U (All Urban Consumers) for the prior calendar year, as reported by the Bureau of Labor Statistics, and rounded to the nearest one-tenth (1/10) of one percent (1%).

(g) Conflict between Agreement and Terminal Service Order . In case of any conflict between the terms of this Agreement and the terms of any Terminal Service Order, the terms of the applicable Terminal Service Order shall govern.

SECTION 10 PRODUCT SPECIFICATIONS

(a) Product Quality .

(i) Product Testing . Upon request, Customer shall provide Operator a laboratory report for each Product delivery by Customer or Customer’s supplier. Operator will not be obligated to receive Contaminated Product for throughput across the Avon Terminal, nor will Operator be obligated to accept Product that fails to meet the quality specifications set forth in the arrival notice.

(ii) Off-Spec/Contaminated Product . Operator may, without prejudice to any other remedy available to Operator, reject and return Contaminated Product to Customer, even after delivery to Operator at the Avon Terminal. Customer at its sole cost and expense shall be responsible for all damages of any kind, in addition to commodity or Waste removal and cleaning costs for connecting pipelines or third party tankage, resulting from the introduction of Contaminated Product. Customer shall remove and replace any Contaminated Product or reimburse Operator for any and all expenses incurred in removing and/or replacing any such Contaminated Product received.

(iii) Minimum Specifications . Operator retains at all times under the Term the right to establish and/or change Operator’s minimum specifications, subject to Section 28(a) , for any Product introduced at the Avon Terminal with thirty (30) days advance notice to Customer. Changes will not affect previously accepted nominated volumes unless immediate action is required by Applicable Law. Operator’s Minimum Specifications shall allow the throughput of the grades and approximate qualities of Products specified in the applicable Terminal Service Order.

(b) Product Warranty . Customer warrants to Operator that all Products tendered by or for the account of Customer for throughput across the Avon Terminal will conform to Operator’s minimum specifications for such Product and the most recently available and commonly accepted assay and any applicable API or ASTM standards. Operator may rely upon the specifications and representations of Customer as to Product quality.

(c) Material Safety Data Sheet . Customer will provide Operator with a Material Safety Data Sheet and any other information required by any federal, state, or local authority for all Products throughput across the Avon Terminal. Customer shall provide its customers with the appropriate information on all Products throughput across the Avon Terminal.

(d) Quality Analysis . Operator will not perform any Product quality analysis on behalf of Customer unless Customer so requests in writing. Any such quality analyses, including any costs for independent inspectors appointed by Customer, are for Customer’s account. In the absence of fraud or manifest error, any quality determination performed by Operator hereunder shall be binding on both Parties. Customer or its designated independent inspector may observe Operator in any measurement or sampling.

SECTION 11 PRODUCT QUANTITY.

The quantity of product received from or loaded to Customer’s Marine Vessels shall be based on Gross Standard Volume using the applicable API and ASTM or equivalent standards for Marine Vessel movements by the following (in order of preference), subject to Operator’s reasonable discretion to choose an alternative method: (a) by meters, (b) by static shore tank gauges of the tank or otherwise, (c) by inspector certificates, or (d) by a mutually agreeable method. The custody transfer quantity shall be determined by

vessel gauges or bills of lading only when mutually agreed to by Customer and Operator. Customer shall provide Operator with all reasonable documentation with respect to the volumes throughput across the Avon Terminal, including but not limited to, inspection reports, meter tickets or other similar documentation within three (3) Business Days of completion of any Marine Vessel discharge.

SECTION 12 WASTE AND HAZARDOUS MATERIALS

(a) Storage, Handling and Disposal of Waste . Operator and Customer will comply with Applicable Law regarding the storage and handling of Product and the disposal of any Waste. Customer shall pay or reimburse Operator for removal from the Avon Terminal and Ancillary Facilities of any Waste or residuals, including all costs associated with any liabilities arising from such Waste or residual. During such removal, the fees and charges set forth in this Agreement will remain in effect. Unless stated otherwise herein, Operator shall be responsible for any fines, penalties, claims, violations, or similar obligations related to Operator’s operation of the Avon Terminal and Ancillary Facilities.

(b) Waste Discharge from Marine Vessels . Operator will not accept Waste from Marine Vessels that discharge cargoes at the Avon Terminal. If Waste is tendered from Marine Vessels as required by any MARPOL Annex, similar regulations, Applicable Law, or the United States Coast Guard, Customer agrees to arrange, or authorize a representative of the Marine Vessel to arrange on the Marine Vessel’s or on Customer’s behalf, for disposal of all such Waste using third-party services approved by Operator, such approval not to be unreasonably withheld, conditioned or delayed. If Customer or its authorized representative refuses to arrange for the removal of such Waste, Operator will arrange for the removal and disposal of such Waste, and Customer shall reimburse Operator for the cost of receiving, handling, storing, and shipping such Waste and shall pay for appropriate treatment, storage and disposal of such Waste in compliance with Applicable Law.

(c) Hazardous Materials—Reporting . Operator will report its handling of all hazardous materials for Customer as required by Applicable Law. Customer will accurately and properly represent the nature of all such materials to Operator. Customer agrees to reimburse Operator for any reasonable, direct charges that Operator may be required to pay for the handling of Product, excluding penalties, fines or excess charges resulting from material errors or omissions in Operator’s reporting as required by Applicable Law.

SECTION 13 SERVICES; HOURS; VOLUME GAINS AND LOSSES

(a) Services . Operator shall throughput and handle Customer’s Products across the Avon Terminal, make all tie-ups and connections at the Avon Terminal (excluding all connection and disconnection of cargo hoses or loading arms at a Marine Vessel’s manifold), provide regulatory compliance reporting that Operator is required to perform as the Avon Terminal operator, and provide such other services set forth in this Agreement (the “ Services ”). Operator will timely provide Customer with a copy of any regulatory compliance report filed by Operator regarding Customer’s Product upon request by Customer. Operator will provide the labor and supervision necessary to perform the Services contemplated by this Agreement, and Operator will provide and maintain the equipment necessary to perform the Services contemplated by this Agreement. Operator will maintain the Avon Terminal according to the Master Lease, the Sublease and good industry practice and will use reasonable care in performing the Services consistent with customary industry practices. Customer personnel shall make all other Marine Vessel connections to the Avon Terminal, chicksans or hoses.

(b) Existing Contractors . Operator may continue to utilize labor, equipment, materials and supplies provided by contractors under their existing service agreements with Customer to perform work to

be performed by Operator hereunder, without the requirement that such existing contracts be amended, assigned or replaced. Such contracts with Customer may continue to cover the work to be provided by Operator hereunder, as provided under Section 4(a) of the Secondment Agreement, and Operator shall be responsible for the costs and expenses of such work performed by such contractors pursuant to those provisions of the Secondment Agreement.

(d) Volume Gains and Losses . Operator shall have no obligation to measure volume gains and losses and shall have no liability whatsoever for normal course physical losses that may result from the transportation of the Products across the Avon Terminal, except if such losses are caused by the negligence or willful misconduct of Operator. Customer will bear any volume gains and losses that may result from the transportation of the Products across the Avon Terminal.

SECTION 14 OPERATIONS

Operator shall operate the Avon Terminal in accordance with the applicable provisions of a Terminal Service Order with respect to the Avon Terminal.

SECTION 15 TITLE AND RISK OF LOSS; CUSTODY AND CONTROL

(a) Title and Risk of Loss . Title and the risk of loss or damage to the Product shall remain at all times with the owner of the Product, subject to any lien in favor of Operator under Applicable Laws.

(b) Custody and Control .

(i) For Marine Vessel deliveries, Operator will have custody of Product from the time Product passes the flange connecting the delivery line of the delivering Marine Vessel until such time as the Product passes to Customer’s pipelines, third party pipelines, or applicable tanks.

(ii) For Marine Vessel loading, Operator will have custody of Product from the time Product passes from Customer’s pipelines, third party pipelines, or applicable tanks until such time as the Product passes to the flange connecting the receiving line of the loading Marine Vessel.

SECTION 16 RESERVED

SECTION 17 COMPLIANCE WITH LAW AND GOVERNMENT REGULATIONS

hereunder and the operation of such Party’s facilities. Without limiting Customer’s reimbursement obligations under Section 6(b) , in the event any action or obligation imposed upon a Party under this Agreement shall at any time be in conflict with any requirement of Applicable Law, then this Agreement shall immediately be modified to conform the action or obligation so adversely affected to the requirements of the Applicable Law, and all other provisions of this Agreement shall remain effective.

(c) Material Change in Applicable Law . Without limiting Customer’s reimbursement obligations under Section 6(b) , if during the Term, any new Applicable Law becomes effective or any existing Applicable Law or its interpretation is materially changed, which change is not addressed by another provision of this Agreement or a Terminal Service Order and which has a material adverse economic impact upon a Party, either Party, acting in good faith, shall have the option to request renegotiation of the relevant provisions of this Agreement or a Terminal Service Order with respect to future performance. The Parties shall then meet to negotiate in good faith amendments to this Agreement or an applicable Terminal Service Order that will conform to the new Applicable Law while preserving the Parties’ economic, operational, commercial and competitive arrangements in accordance with the understandings set forth herein.

SECTION 18 LIMITATION OF LIABILITY

(b) Claims and Liability for Lost Product . Operator shall not be liable to Customer for lost or damaged Product unless (i) Operator would be responsible under Section 13(d) and (ii) Customer notifies Operator in writing within ninety (90) days of the report of any incident or the date Customer learns of any such loss or damage to the Product. Operator’s maximum liability to Customer for any lost or damaged Product shall be limited to (i) the lesser of (1) the replacement value of the Product at the time of the incident based upon the price as posted by Platts or similar publication for similar Product in the same locality, and if no other similar Product is in the locality, then in the state, or (2) the actual cost paid for the Product by Customer (copies of Customer’s invoices of cost paid must be provided), less (ii) the salvage value, if any, of the damaged Product.

(d) No Guarantees or Warranties . Except as expressly provided in this Agreement, neither Customer nor Operator makes any guarantees or warranties of any kind, expressed or implied. Operator specifically disclaims all implied warranties of any kind or nature, including any implied warranty of merchantability and/or any implied warranty of fitness for a particular purpose.

SECTION 19 INDEMNIFICATION

(a) Duty to Indemnify Customer Group . Notwithstanding anything to the contrary in this Agreement or any Terminal Service Order, Operator SHALL RELEASE, DEFEND, INDEMNIFY, AND HOLD HARMLESS Customer, its affiliates and their respective officers, directors, employees, agents, successors, and assigns (excluding any member of the Operator Group) (collectively, the “ Customer Group ”) from and against all claims, suits, causes of action, demands, losses, liabilities, damages, costs, expenses, fees (including, but not limited to, reasonable attorney’s fees), and court costs (collectively, “ Claims ”), inclusive of Claims made by third parties, arising from or relating to any injury to or death of persons and/or damage, loss, or injury to any property (excluding Product) TO THE EXTENT OF THE PERCENTAGE OR PROPORTION OF DETERMINED FAULT ARISING FROM THE BREACH, DEFAULT, STRICT LIABILITY, WILLFUL MISCONDUCT OR THE NEGLIGENT ACTS, ERRORS, OR OMISSIONS OF OPERATOR OR ANY MEMBER OF THE OPERATOR GROUP (AS DEFINED BELOW) WHILE PERFORMING OPERATOR’S OBLIGATIONS UNDER THIS AGREEMENT.

(b) Duty to Indemnify Operator Group . Notwithstanding anything to the contrary in this Agreement or any Terminal Service Order, CUSTOMER SHALL RELEASE, DEFEND, INDEMNIFY, AND HOLD HARMLESS General Partner, the Partnership, their subsidiaries and their respective officers, directors, members, managers, employees, agents, successors, and assigns (collectively, the “ Operator Group ”) from and against all Claims, inclusive of Claims made by third parties, arising from or relating to any injury to or death of persons and/or damage, loss, or injury to any property (excluding Product) TO THE EXTENT OF THE PERCENTAGE OR PROPORTION OF DETERMINED FAULT ARISING FROM THE BREACH, DEFAULT, STRICT LIABILITY, WILLFUL MISCONDUCT OR THE NEGLIGENT ACTS, ERRORS, OR OMISSIONS OF CUSTOMER OR ANY MEMBER OF THE CUSTOMER GROUP WHILE USING THE AVON TERMINAL AND/OR TO THE EXTENT OF THE PERCENTAGE OR PROPORTION OF DETERMINED FAULT ARISING FROM THE BREACH, DEFAULT, STRICT LIABILITY, WILLFUL MISCONDUCT OR THE NEGLIGENT ACTS, ERRORS, OR OMISSIONS OF CUSTOMER OR ANY MEMBER OF THE CUSTOMER GROUP WHILE PERFORMING CUSTOMER’S OBLIGATIONS UNDER THIS AGREEMENT.

(c) Failure to Maintain Required Coverages . In the event that (a) Customer does not maintain, or does not cause the Customer Insurance Group members to maintain, the insurance coverages required by Section 23 of this Agreement or (b) Customer fails to include Operator as an additional insured on all policies of insurance required by Section 23 of this Agreement, then Customer shall hold harmless and indemnify Operator against all Claims that otherwise would have been insured.

LOSSES, COSTS, EXPENSES OR DAMAGES IN QUESTION ARISE OR AROSE SOLELY OR IN PART FROM THE GROSS, ACTIVE, PASSIVE OR CONCURRENT NEGLIGENCE, STRICT LIABILITY, WILLFUL MISCONDUCT OR OTHER FAULT OF ANY INDEMNIFIED PARTY. EACH PARTY ACKNOWLEDGES THAT THIS STATEMENT COMPLIES WITH THE EXPRESS NEGLIGENCE RULE AND CONSTITUTES CONSPICUOUS NOTICE. NOTICE IN THIS CONSPICUOUS NOTICE IS NOT INTENDED TO PROVIDE OR ALTER THE RIGHTS AND OBLIGATIONS OF THE PARTIES, ALL OF WHICH ARE SPECIFIED ELSEWHERE IN THIS AGREEMENT.

SECTION 20 DEFAULT

(a) A Party shall be in default under this Agreement if:

(i) the Party breaches any provision of this Agreement, a Terminal Service Order or any of the Related Agreements, which breach has a material adverse effect on the other Party, and such breach is not excused by Force Majeure or cured within fifteen (15) Business Days after notice thereof (which notice shall describe such breach in reasonable detail) is received by such Party (unless such failure is not commercially reasonably capable of being cured in such fifteen (15) Business Day period in which case such Party shall have commenced remedial action to cure such breach and shall continue to diligently and timely pursue the completion of such remedial action after such notice); or

(b) If either of the Parties is in default as described above, then (i) if Customer is in default, Operator may or (ii) if Operator is in default, Customer may: (1) terminate this Agreement upon notice to the defaulting Party; (2) withhold any payments due to the defaulting Party under this Agreement and any Terminal Service Order; and/or (3) pursue any other remedy at law or in equity.

(d) Cumulative Nature of Remedies . The remedies of Customer provided for in this Agreement shall not be exclusive, but shall be cumulative and shall be in addition to all other remedies at law or in equity.

(e) Right of First Refusal . In the event that Operator proposes to enter into a marine terminal use and throughput agreement with a third party upon the termination of this Agreement, or any part hereof, for reasons other than by default by Customer, Operator shall give Customer ninety (90) days prior written notice of any proposed new marine terminal use and throughput agreement with a third party, including (i) details of all of the material terms and conditions thereof and (ii) a thirty (30)-day period (beginning upon Customer’s receipt of such written notice) (the “ First Offer Period ”) in which Customer may make a good faith offer to enter into a new marine terminal use and throughput agreement with Operator (the “ Right of First Refusal ”). If Customer makes an offer on terms no less favorable to Operator than the third-party offer with respect to such marine terminal use and throughput agreement during the First Offer Period, then Operator shall be obligated to enter into a marine terminal use and throughput agreement with Customer on the terms set forth in Section 22(d) . If Customer does not exercise its Right of First Refusal in the manner set forth above, Operator may, for the next ninety (90) days, proceed with the negotiation of the third-party marine terminal use and throughput agreement. If no third-party marine terminal use and throughput agreement is consummated during such ninety-day period, the terms and conditions of this Section 20(e) shall again become effective. Notwithstanding anything contained in this Section 20(e) to the contrary, Customer’s Right of First Refusal shall only be available and exercisable for a period of one hundred twenty (120) days after termination of this Agreement for reasons other than by default by Customer.

SECTION 21 FORCE MAJEURE

If a Party is unable to perform or is delayed in performing, in whole or in part, its obligations under this Agreement, other than the obligation to pay funds when due as a result of an event of Force Majeure at the Avon Terminal or the Ancillary Facilities, then that Party shall promptly notify the other Party of the event of Force Majeure with reasonably full particulars and timing of such event. Such Party also shall promptly notify the other Party when the event of Force Majeure terminates or no longer adversely affects its ability to perform under this Agreement. The obligations of the Party giving notice, so far as they are affected by the event of Force Majeure, shall be suspended during, but not longer than, the continuance of the Force Majeure event. The affected Party must act with commercially reasonable diligence to resume performance, but it shall not be required to expend funds to settle strikes, lockouts or other labor difficulty. A Party’s inability economically to perform its obligations hereunder does not constitute an event of Force Majeure. If Operator is excused from providing services due to an event of Force Majeure, other than any fees that are already due and payable hereunder, any other fees incurred by Customer during the event of Force Majeure shall be excused or proportionately reduced, as appropriate, for so long as Operator’s performance is so excused due to the event of Force Majeure. In the event the Avon Terminal or any part thereof is destroyed or damaged to such extent as to make them unusable, then Operator, in its sole discretion, subject to the terms and provisions of the Master Lease and the Sublease, may elect whether or not to repair, replace, or rebuild. An event of Force Majeure shall not extend the term of this Agreement. If an event of Force Majeure materially affects either Party’s performance under this Agreement and exists with respect to the Avon Terminal or the Ancillary Facilities for twelve (12) Months, then either Party shall have the right to terminate this Agreement without further costs or obligation to the other Party.

SECTION 22 ASSIGNMENT; NEW MARINE TERMINALLING AGREEMENT; PARTNERSHIP CHANGE OF CONTROL

(b) Except as otherwise provided in this Section 22 , Customer shall not transfer, assign, or convey its interests hereunder, in whole or in part, to a third party without the written consent of the Operator, which shall not be unreasonably withheld. Operator may assign its interest hereunder without consent from Customer to any subsidiary or affiliated company. Operator shall be permitted to make a collateral assignment of this Agreement solely to secure working capital financing for Operator. Customer may assign its interest hereunder without consent from Operator to any subsidiary or affiliated company or any purchaser of the Refinery, provided that such purchaser meets acceptable credit standards to be determined in Operator’s commercially reasonable discretion. A Party making a permitted assignment shall notify the other Party in writing at least ten (10) days prior to the effective date of such assignment.

(c) Customer’s obligations hereunder shall not terminate in connection with a Partnership Change of Control. Operator shall provide Customer with notice of any Partnership Change of Control at least sixty (60) days prior to the effective date thereof.

(d) Upon expiration of this Agreement pursuant to its terms, or in the event of a Partnership Change of Control, both Customer and Operator agree to enter into a new marine terminal use and throughput agreement for the Avon Terminal that (i) is consistent with the terms set forth in this Agreement and (ii) has commercial terms that are, in the aggregate, equal to or more favorable to Operator than fair market value terms as would be agreed by similarly-situated parties negotiating at arm’s length; provided, however, that the term of any such new marine terminal use and throughput agreement shall be based on Refinery requirements, conditioned on Operator’s continued operation of the Avon Terminal on terms and conditions acceptable to the Operator, and Operator shall not be required to extend the term of the Master Lease or the Sublease or subsequent renewals thereof in order to provide continuing services to Customer.

SECTION 23 INSURANCE

(a) Insurance Required by Operator . Operator shall be required to carry at least the minimum level of insurance required pursuant to the Master Lease and the Sublease.

(b) Insurance Required by Customer . Customer shall obtain at its sole cost and expense and shall carry and maintain in full force and effect, and cause its carriers, contractors, agents and representatives (collectively, the “ Customer Insurance Group ”) to obtain and maintain, insurance coverages with insurance companies rated not less than A-, IX by A.M. Best or otherwise reasonably satisfactory to Operator of the following types and amounts:

(i) Workers’ Compensation . Workers’ Compensation Insurance for statutory limits and in accordance with Applicable Laws of the state(s) where the work or operations under this Agreement are to be performed, including, without limitation, the U.S. Longshore and Harbor Workers’ Compensation Act as well as the Outer Continental Shelf Lands Act with Volunteer Compensation for marine operations to include transportation, wages, maintenance and cure, and Jones Act Coverage where required;

(1) Bodily injury by accident – $1,000,000 per accident;

(2) Bodily injury by disease – $1,000,000 each employee; and

(3) Bodily injury by disease – $1,000,000 policy limit.

(iii) Commercial Automobile . Commercial Automobile Liability Insurance covering each vehicle whether owned, non-owned, hired, operated, or used by Customer and/or any member of the Customer Insurance Group while in, on or adjacent to the Avon Terminal, with a combined single limit of not less than one million dollars ($1,000,000) for bodily injury and property damage as to any one accident, including an MCS-90 endorsement.

(c) Required Insurance for Customer’s Marine Carriers . Customer shall cause all marine carriers who will access the Avon Terminal on its behalf to maintain insurance coverage as set forth below:

(d) Certificates of Insurance; Endorsements . Excluding insurance for Customer’s marine carriers, Customer shall cause the Operator Group (as defined above) to be named as an additional insured on all policies of insurance secured by Customer and the members of the Customer Group in accordance with this Agreement. Customer shall furnish Operator with certificates of insurance evidencing this coverage. All policies shall be endorsed to provide that no material change or cancellation of the coverage shall occur until Operator has received thirty (30) days written notice. Customer hereby waives, and shall cause its insurers and those of the Customer Insurance Group to also waive any right of subrogation that they may have against the Operator or the Operator Group. All insurance coverage required hereunder shall be primary to, and not in excess of or contributory with, any insurance that may be maintained by Operator.

(e) Self-Insurance . Subject to Operator’s review and approval, which will not be unreasonably withheld, Customer may self-insure the Commercial General Liability Insurance requirements set forth in Section 23(b)(iv) . Operator reserves the right, at Operator’s discretion, to periodically review Customer’s financial means to meet the Customer Insurance Group insurance requirements included herein by self-insurance. If Operator reasonably determines that Customer cannot meet the insurance obligations included herein by self-insurance, Operator may require Customer to obtain and maintain insurance coverages for requirements as provided in this Section 23 with insurance companies rated not less than A-, IX by A.M. Best or otherwise reasonably satisfactory to Operator. The self-insurance shall protect the indemnified parties in the same manner and to the same extent as they would have been protected had the policy or policies not been self-insured, contained a self-insured retention or deductible.

SECTION 24 NOTICE

If to Customer, to:

Tesoro Refining & Marketing Company LLC

19100 Ridgewood Parkway

San Antonio, Texas 78259

For legal notices :

Attention: General Counsel

If to Operator, to:

Tesoro Logistics Operations LLC

19100 Ridgewood Parkway

San Antonio, Texas 78259

For legal notices :

Attention: General Counsel

For all other notices and communications :

Attention: Don J. Sorensen, Vice President, Operations

phone: (210) 626-6195

email: Don.J.Sorensen@tsocorp.com

or to such other address or to such other Person as either Party will have last designated by notice to the

other Party.

SECTION 25 REPORTS AND AUDIT

shall have the right to audit such records at any reasonable time or times during the Term and for a period of up to three (3) years after termination of this Agreement. Claims as to shortage in quantity or defects in quality shall be made by written notice within ninety (90) days after the delivery in question or shall be deemed to have been waived.

SECTION 26 CONFIDENTIAL INFORMATION

(i) is available, or becomes available, to the general public without fault of the receiving Party;

(ii) was in the possession of the receiving Party on a non-confidential basis prior to receipt of the same from the disclosing Party (it being understood, for the avoidance of doubt, that this exception shall not apply to information of Operator that was in the possession of Customer or any of its affiliates as a result of their ownership or operation of the Avon Terminal prior to the Commencement Date);

(iv) is independently developed by the receiving Party without reference to or use of the disclosing Party’s Confidential Information.

Confidential Information pursuant to Applicable Law, and the receiving Party shall be entitled to retain any Confidential Information in the electronic form or stored on automatic computer back-up archiving systems during the period such backup or archived materials are retained under such Party’s customary procedures and policies; provided, however, that any Confidential Information retained by the receiving Party shall be maintained subject to confidentiality pursuant to the terms of this Section 26 , and such archived or back-up Confidential Information shall not be accessed except as required by Applicable Law.

(d) Receiving Party Personnel . The receiving Party will limit access to the Confidential Information of the disclosing Party to those of its employees, attorneys and contractors that have a need to know such information in order for the receiving Party to exercise or perform its rights and obligations under this Agreement (the “ Receiving Party Personnel ”). The Receiving Party Personnel who have access to any Confidential Information of the disclosing Party will be made aware of the confidentiality provision of this Agreement, and will be required to abide by the terms thereof. Any third party contractors that are given access to Confidential Information of a disclosing Party pursuant to the terms hereof shall be required to sign a written agreement pursuant to which such Receiving Party Personnel agree to be bound by the provisions of this Agreement, which written agreement will expressly state that it is enforceable against such Receiving Party Personnel by the disclosing Party.

(e) Survival . The provisions of this Section 26 shall survive the termination of this Agreement for two (2) years.

SECTION 27 SAFE BERTH

Operator shall exercise due diligence to provide a berth which the nominated Marine Vessels accepted by the Operator can safely reach and leave and at which the Marine Vessel can lie, load, and discharge always safely afloat; provided however, Operator makes no representation or warranty regarding the safety of any channel, anchorage or other waterway used in approaching or departing from the designated berth. It is understood that, per the Master Lease and Sublease, Operator does not maintain the berthing depth; however, Operator shall ensure that Customer and any of Customer’s accepted Marine Vessels are immediately notified of any changes in water depth that affect the stated draft maximum at mean lower low water as set forth in an applicable Terminal Service Order.

SECTION 28 MISCELLANEOUS

Omnibus Agreement shall prevail with respect to issues related to the contribution of the assets described therein, but not with respect to the ordinary operations of such assets as set forth in this Agreement.

(c) Construction and Interpretation . In interpreting this Agreement, unless the context expressly requires otherwise, all of the following apply to the interpretation of this Agreement:

(i) Preparation of this Agreement has been a joint effort of the Parties and the resulting Agreement against one of the Parties as the drafting Party.

(ii) Plural and singular words each include the other.

(iii) Masculine, feminine and neutral genders each include the others.

(iv) The word “or” is not exclusive and includes “and/or.”

(v) The words “includes” and “including” are not limiting.

(vi) References to the Parties include their respective successors and permitted assignees.

(d) Governing Law; Jurisdiction . This Agreement shall be governed by the laws of the State of Texas without giving effect to its conflict of laws principles; provided that any issues or claims arising out of the terms and conditions of the Sublease, or rules and regulations of the California State Lands Commission will be governed by the laws of the State of California. Each Party hereby irrevocably submits to the exclusive jurisdiction of any federal court of competent jurisdiction situated in the United States District Court for the Western District of Texas, San Antonio Division, or if such federal court declines to exercise or does not have jurisdiction, in the District Court of Bexar County, Texas. The Parties expressly and irrevocably submit to the jurisdiction of said courts and irrevocably waive any objection which they may now or hereafter have to the laying of venue of any action, suit or proceeding arising out of or relating to this agreement brought in such courts, irrevocably waive any claim that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum and further irrevocably waive the right to object, with respect to such claim, action, suit or proceeding brought in any such court, that such court does not have jurisdiction over such Party. The Parties hereby irrevocably consent to the service of process by registered mail, postage prepaid, or by personal service within or without the State of Texas. Nothing contained herein shall affect the right to serve process in any manner permitted by law.

affect any other provision hereof, and the Parties will negotiate in good faith with a view to substitute for such provision a suitable and equitable solution in order to carry out, so far as may be valid and enforceable, the intent and purpose of such invalid, illegal or unenforceable provision.

(g) Independent Contractor . Operator’s relationship to Customer hereunder shall be that of an independent contractor. Nothing in this Agreement shall be construed to make Operator or any of its employees, an agent, associate, joint venturer or partner of Customer.

(h) No Public Use . Operator’s services hereunder shall not be deemed those of a public utility or common carrier. If any action is taken or threatened to declare these services a public use, then, upon notifying Customer, Operator may restructure and restate this Agreement.

(i) No Bonded Services . Operator is not providing a U.S. Customs bonded warehouse service.

[Signature Page Follows]

IN WITNESS WHEREOF , the Parties hereto have duly executed this Agreement, effective as of the Commencement Date.



	TESORO LOGISTICS OPERATIONS LLC By: ____________________ Phillip M. Anderson President Solely in respect of Section 22 only: TESORO LOGISTICS LP By: TESORO LOGISTICS GP, LLC, its general partner By: ____________________ Phillip M. Anderson President Solely in respect of Section 22 only: TESORO LOGISTICS GP, LLC By: ____________________ Phillip M. Anderson President
	TESORO REFINING & MARKETING COMPANY LLC By: ____________________ Gregory J. Goff Chairman of the Board of Managers and President

Signature Page to Avon Marine Terminal Use and Throughput Agreement

EXHIBIT 1
FORM OF TERMINAL SERVICE ORDER

(AVON TERMINAL [ ]- ___, 20__)

This Terminal Service Order is entered as of______ ___, 20__, by and between Tesoro Refining & Marketing Company LLC, a Delaware limited liability company, and Tesoro Logistics Operations LLC, a Delaware limited liability company, pursuant to and in accordance with the terms of the Avon Marine Terminal Use and Throughput Agreement dated as of __________ __, 2016, by and among such parties and Tesoro Logistics GP, LLC, a Delaware limited liability company, and Tesoro Logistics LP, a Delaware limited partnership (the “ Agreement ”).

Capitalized terms not otherwise defined herein shall have the meaning set forth in the Agreement.

Pursuant to Section 9 of the Agreement, the parties hereto agree to the following provisions:

[Insert applicable provisions:

(i) the rules and procedures for the Avon Terminal referenced in Section 2 ;


(ii)	the per Barrel throughput fees at the Avon Terminal;


(iii)	any MVR Fee specified pursuant to Section 5(a)(ii) ;


(iv)	the grades and approximate qualities of Products pursuant to Section 10(a)(iii) ;


(v)	specifics of dock operations as referenced in Sections 14 and 27 ;


(vi)	any other calculation methods and procedures applicable to the MPC or the OCR; and


(vii)	any other services as may be agreed.]

Except as set forth in this Terminal Service Order, the other terms of the Agreement shall continue in full force and effect and shall apply to the terms of this Terminal Service Order.

[Signature Page Follows]

Exhibit 1 –

Avon Marine Terminal Use and Throughput Agreement

IN WITNESS WHEREOF , the parties hereto have duly executed this Terminal Service Order as of the date first written above.



TESORO LOGISTICS OPERATIONS LLC By: Phillip M. Anderson President	TESORO REFINING & MARKETING COMPANY LLC By: Cynthia J. Warner Executive Vice President-Operations

Exhibit 1 –

Avon Marine Terminal Use and Throughput Agreement

Tesoro Corporation Sells Northern California Terminalling and Storage Assets to Tesoro Logistics

SAN ANTONIO – November 21, 2016 - Tesoro Corporation (NYSE:TSO) and Tesoro Logistics LP (NYSE:TLLP) today announced that a subsidiary of Tesoro has closed the sale of terminalling and storage assets located in Martinez, California to TLLP. The Northern California Terminalling and Storage Assets include 5.8 million barrels of crude oil, feedstock, and refined product storage capacity at Tesoro’s Martinez Refinery along with a marine terminal capable of handling up to 35,000 bpd of feedstock and refined product throughput. TLLP acquired the Northern California Terminalling and Storage Assets for total consideration of $400 million, including $360 million of cash financed with borrowings on TLLP’s revolving credit facility and $40 million of common and general partner units to Tesoro. The equity consideration was based on the average daily closing price of TLLP's common units for the 10 trading days prior to closing, or $45.53 per unit, with 860,933 units in the form of common units and 17,570 units in the form of general partner units. In connection with the acquisition, Tesoro and TLLP entered into long-term, fee-based storage and throughput and use agreements which are expected to provide stable cash flows to TLLP.

In addition, TLLP today announced that it has agreed to acquire crude oil, natural gas and produced water gathering systems and two natural gas processing facilities from Whiting Oil and Gas Corporation, GBK Investments, LLC and WBI Energy Midstream, LLC for total consideration of approximately $700 million. The North Dakota Gathering and Processing Assets include over 650 miles of crude oil, natural gas, and produced water gathering pipelines, 170 MMcf per day of natural gas processing capacity and 18,700 barrels per day of fractionation capacity in the Sanish and Pronghorn fields of the Williston Basin in North Dakota.

“These two acquisitions strengthen TLLP’s portfolio of logistics assets that provide full-service capabilities to both downstream and upstream customers,” said Greg Goff, Chairman and CEO. “TLLP is on target to achieve its 2017 goal of $820 million in operating income and $1 billion of annual EBITDA. Further, these assets provide optimization and organic investment opportunities that support future growth.”

Concurrent with these two transactions, Tesoro has agreed to waive $100 million of general partner incentive distributions with respect to 2017 and 2018, or $12.5 million per quarter, to support the balanced growth of

the general and limited partners’ interests and maintain strong financial metrics. The expected annual net earnings and annual EBITDA contribution for both the Northern California Terminalling and Storage Assets and the North Dakota Gathering and Processing Assets are included in Tesoro’s previously announced 2017 expected annual improvements to operating income of $475 to $575 million.

About Tesoro Corporation

Tesoro Corporation, a Fortune 100 company, is an independent refiner and marketer of petroleum products. Tesoro, through its subsidiaries, operates seven refineries in the western United States with a combined capacity of over 895,000 barrels per day and ownership in a logistics business, which includes an interest in Tesoro Logistics LP (NYSE: TLLP) and ownership of its general partner. Tesoro's retail-marketing system includes over 2,400 retail stations under the ARCO®, Shell®, Exxon®, Mobil®, USA Gasoline™, Rebel™ and Tesoro® brands.

This press release contains certain statements that are “forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. You can identify forward-looking statements by the use of words such as “may,” “should,” “could,” “estimates,” “predicts,” “potential,” “continue,” “anticipates,” “believes,” “'plans,” “expects,” “future” and “intends” and similar expressions which are intended to identify forward-looking statements. These forward-looking statements include, but are not limited to, statements concerning anticipated benefits of the transactions; our ability to complete the acquisition of the North Dakota assets; TLLP’s ability to achieve its 2017 goals for net earnings and EBITDA; and our expected annual improvements to operating income . For more information concerning factors that could affect these statements see our annual report on Form 10-K and quarterly reports on Form 10-Q, filed with the Securities and Exchange Commission (the “SEC”). We undertake no obligation to publicly release the result of any revisions to any such forward-looking statements that may be made to reflect events or circumstances that occur, or which we become aware of, after the date hereof.

Contact:

Investors:

Sam Ramraj, Vice President, Investor Relations, (210) 626-4757

Media:

Tesoro Media Relations, media@tsocorp.com , (210) 626-7702



TESORO CORPORATION
RECONCILIATION OF AMOUNTS REPORTED UNDER U.S. GAAP (Unaudited) (in millions)

	TLLP 2017 Annual Expected Segment EBITDA
Reconciliation of Projected Operating Income to Projected Annual Segment EBITDA:
Projected operating income	$	820
Add: Depreciation and amortization expenses	180
Projected Annual Segment EBITDA	$	1,000