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                                                              Loan No.:_________


                           LOAN AND SECURITY AGREEMENT

         THIS LOAN AND SECURITY AGREEMENT ("Agreement") is entered into as of
the 30th of December, 1999, by and among HELLER FINANCIAL LEASING, INC., a
Delaware corporation ("Secured Party"), whose address is Commercial Equipment
Finance Division, 500 West Monroe Street, Chicago, Illinois 60661, and SOUTH
HAMPTON REFINING CO., a Texas corporation, ("South Hampton"), and GULF STATE
PIPE LINE COMPANY, INC., a Texas corporation, ("Gulf State"). South Hampton and
Gulf State are referred to herein collectively as "Debtors," and each may be
individually referred to as a "Debtor"). Debtors have a common business address
of 7752 FM 418, P.O. Box 1636, Silsbee, Texas 77656.

                                   WITNESSETH:

         1. The Loan. Subject to the prior satisfaction of all of the conditions
precedent contained in the Loan Documents (as defined herein), Secured Party
agrees to make available to Debtors and Debtors agree to borrow from Secured
Party, on or before December 31, 1999, up to an aggregate principal amount of
$3,500,000 (the "Loan"). Subject to the foregoing, the Loan will be funded in
one advance (the "Advance") on the date of this Agreement and will be evidenced
by a promissory note in the form of Exhibit A attached hereto (the "Note"). The
Advance will be used solely to partially fund the acquisition (the "Coin
Acquisition") of 92% of Productos Quimicos Coin, S.A., de C.V. ("Coin"). The
Advance shall be on and subject to the terms and conditions set forth in this
Agreement and the other Loan Documents and shall otherwise be at Secured Party's
sole discretion.

         2. Conditions to the Advance.

                  (a) Prior to the Advance, the following conditions shall have
         been satisfied in the opinion of the Secured Party:

                           (i) This Agreement and all other Loan Documents
                  (herein so called and being the Note, a Guaranty from Arabian
                  Shield Development Company, a Delaware corporation ("Arabian
                  Shield"), American Shield Refining Company, a Delaware
                  corporation ("American Shield"), and Texas Oil and Chemical
                  Co. II, Inc., a Texas corporation ("Texas Oil II")
                  (collectively, "Guarantors"), a Pledge Agreement from each of
                  South Hampton and Texas Oil II, covering all of the stock of
                  Gulf State in the case of South Hampton, and all of the stock
                  of South Hampton in the case of Texas Oil II, the Ground Lease
                  (as defined below), the Sublease (as defined below) and each
                  and every other document required by Secured Party to be
                  executed in connection with the Loan, together with all
                  amendments, supplements, modifications and other changes
                  thereto, in each case being in form and substance satisfactory
                  to Secured Party) shall have been duly authorized and executed
                  by Debtors (and by Guarantors, as applicable) and delivered to
                  Secured Party.



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                           (ii) Each Debtor shall have delivered to Secured
                  Party its respective good standing certificates, certificates
                  of existence, certificates of incumbency and duly certified
                  resolutions of its board of directors (in form and substance
                  satisfactory to Secured Party) authorizing it to enter into
                  and perform the transactions contemplated by the Loan
                  Documents.

                           (iii) Secured Party shall have received an opinion
                  from counsel to Debtors and Guarantors, in form and substance
                  satisfactory to Secured Party.

                           (iv) The representations and warranties contained in
                  this Agreement and the other Loan Documents shall be true and
                  correct on the date of the Advance as if made on such date, no
                  Event of Default (as defined in this Agreement), or event
                  which with the passage of time or giving of notice would
                  constitute an Event of Default (as defined in this Agreement)
                  shall have occurred and be continuing, and no material adverse
                  change shall have occurred with respect to Debtors' business
                  or assets (including, without limitation, the Collateral, as
                  defined in this Agreement) since October 31, 1999.

                           (v) Evidence of insurance which complies with the
                  requirements of the Loan Documents shall have been delivered
                  to Secured Party.

                           (vi) Receipt by Secured Party of a $17,500 commitment
                  fee (all commitment fees described herein are in addition to
                  any Earnest Money (as defined herein)).

                           (vii) UCC-1 Financing Statements covering the
                  Collateral shall have been duly authorized and executed by the
                  Debtors and delivered to Secured Party.

                           (viii) The results of a UCC search showing all
                  financing statements and other documents or instruments on
                  file against each Debtor and each Guarantor in the office of
                  the Secretary of State of the State of Texas and such other
                  jurisdictions as Secured Party may request, each such search
                  to be as of a date no more than 10 days prior to the date
                  hereof;

                           (ix) Receipt by Secured Party of a certificate from
                  Debtors in favor of and satisfactory to Secured Party stating
                  that no Debtor is presently involved in any litigation other
                  than such litigation previously disclosed to Secured Party in
                  writing.

                           (x) Receipt by Secured Party of $35,000 as earnest
                  money ("Earnest Money"). Debtors agree that regardless of
                  whether Secured Party makes any Advance, the Earnest Money
                  will be applied (i) to all legal fees and expenses incurred by
                  Secured Party in connection with documentation, negotiation
                  and closing the loan contemplated by this Agreement and (ii)
                  to Secured Party's environmental appraisal costs and expenses.
                  If any Earnest Money remains after payment of the foregoing
                  (such remainder, if any, being the "Balance"), and if the
                  Advance is made by Secured



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                  Party to South Hampton, then the Balance will be applied by
                  Secured Party as a credit against the $17,500 commitment fee
                  described in subparagraph (vi) preceding. Debtors understand
                  and agree that if the transactions contemplated by this
                  Agreement fail to consummate by March 31, 2000, for any reason
                  directly or indirectly related to Debtors' inability or
                  refusal to close on the exact terms and conditions set forth
                  in this Agreement, then all of the Earnest Money will be the
                  property of Secured Party without further action or notice.

                           (xi) A Ground Lease (herein so called), in form and
                  substance satisfactory to Secured Party, shall have been duly
                  authorized and executed by South Hampton and delivered to
                  Secured Party, covering the approximately 105 acres of land
                  comprising South Hampton's refinery (the "Real Property").

                           (xii) The machinery and equipment Collateral and the
                  value thereof (determined independently) shall be satisfactory
                  to Secured Party in its sole discretion.

                           (xiii) Secured Party shall be satisfied that there
                  has been no material adverse change in the financial condition
                  of either Debtor or any Guarantor.

                           (xiv) A Sub-Ground Lease (the "Sublease"), in form
                  and substance satisfactory to Secured Party, shall have been
                  duly authorized and executed by Secured Party and delivered to
                  South Hampton.

         3. The Note and Interest Rate. The $3,500,000 Advance shall be
evidenced by the Note. The unpaid principal amount of the Note shall bear
interest at the rate set forth in the Note. Amounts advanced and repaid may not
be reborrowed.

         4. Payment and Prepayments. The amount of unpaid principal and accrued
interest on the Notes shall be paid as set forth in each respective Note. South
Hampton may not prepay the Note in whole or in part at any time prior to
December 30, 2000. After December 30, 2000 and upon 30 days written notice to
Secured Party, may voluntarily prepay the Loan in whole, but not in part, by
advising Secured Party in writing at least 30 days prior to prepayment and by
paying to Secured Party at the time of such prepayment (i) any and all other
sums due under any of the Loan Documents (as defined herein) and (ii) the
Prepayment Fee (as defined herein). As used herein, "Prepayment Fee" shall mean
an amount equal to the Applicable Percentage (as defined herein) multiplied by
the principal balance prepaid. The term "Applicable Percentage" shall mean (a)
3% if the prepayment occurs on or before December 30, 2001, (b) 2% if the
prepayment occurs after December 30, 2001 and on or before December 30, 2002,
and (c) 1% if the prepayment occurs after December 30, 2002 and before the
stated maturity of the Note. The Prepayment Fee shall also be due and owing upon
involuntary prepayment as a result of Secured Party's exercise of any remedies
provided in this Agreement or any of Loan Documents.

         5. Secure Payment. To secure payment of indebtedness as evidenced by
the $3,500,000 Promissory Note of even date herewith made by Debtors, payable to
the order of Secured Party (the "Note"), and any obligations arising under this
Agreement, and also to secure any other indebtedness



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or liability of Debtors to Secured Party, direct or indirect, absolute or
contingent, due or to become due, now existing or hereafter arising and no
matter how acquired by Secured Party, including all future advances or loans
which may be made at the option of Secured Party (all the foregoing hereinafter
called the "Indebtedness"), Debtors hereby grant and convey to Secured Party a
first priority continuing lien and security interest in the property described
on the schedule attached hereto and made a part hereof by this reference (the
"Schedule"), together with all insurance related thereto, and all proceeds
(including insurance proceeds) thereof, if any, and all substitutions,
modifications, replacements, attachments, additions, improvements, and
accessions thereto, and all intellectual property rights of ownership and/or
use, or other ownership or rights to use of proprietary information, as owner,
licensee, or otherwise relating to any of the foregoing (all of the foregoing
hereinafter called the "Collateral").

         6. Representations, Warranties and Covenants. Debtors hereby each
represent, warrant and covenant as follows:

                  (a) Perform Obligations. Debtors shall pay as and when due all
         Indebtedness secured by this Agreement and perform all of the
         obligations contained in this Agreement according to its terms. Debtors
         shall use the loan proceeds for business uses and not for personal,
         family, household, or agricultural uses.

                  (b) Perfection. This Agreement and all necessary Uniform
         Commercial Code filings together create a valid, perfected and first
         priority continuing lien and security interest in the Collateral,
         securing the payment and performance of the Indebtedness, and all
         filings and other actions necessary or desirable to create, perfect and
         protect such security interest have been or will be duly taken.

                  (c) Collateral Free and Clear. The Collateral is and shall
         remain free and clear of all liens, claims, charges, encumbrances and
         other security interests of any kind ("Liens") (other than the security
         interest granted hereby). Debtors shall defend the title to the
         Collateral against all persons and against all claims and demands
         whatsoever.

                  (d) Possession and Operating Order of the Collateral. Debtors
         shall retain possession of the Collateral at all times and shall not
         sell, exchange, assign, loan, deliver, lease, mortgage, or otherwise
         dispose of the Collateral or any part thereof (other than sales of
         motor vehicles or equipment that are worn out, obsolete or no longer
         useful to Debtors' business so long as such assets are promptly
         replaced with similar assets having substantially the same business
         utility and at least the same value and provided that such replacement
         assets are subject to the Lien in favor of the Secured Party) without
         the prior written consent of Secured Party. Debtors shall at all times
         keep the Collateral at the location[s] specified on the Schedule
         (except for removals thereof in the usual course of business for
         temporary periods). At Debtors' sole cost and expense, Debtors shall
         keep the Collateral in good repair and condition and shall not misuse,
         abuse, waste or otherwise allow it to deteriorate, except for normal
         wear and tear. Secured Party may verify any Collateral in any
         reasonable manner which Secured Party may consider appropriate, and
         Debtors shall furnish all reasonable



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         assistance and information and perform any acts which Secured Party may
         reasonably request in connection therewith.

                  (e) Insurance. Debtors shall insure the Collateral against
         loss by fire (including extended coverage), theft and other hazards,
         for its full insurable value including replacement costs, with a
         deductible not to exceed $50,000 per occurrence and without
         co-insurance. In addition, Debtors shall obtain liability insurance
         covering liability for bodily injury, including death and property
         damage, in an amount of at least $5,000,000 per occurrence or such
         greater amount as may comply with general industry standards, or in
         such other amounts as Secured Party may otherwise require. All policies
         of insurance required hereunder shall be in such form, amounts, and
         with such companies as Secured Party may approve; shall provide for at
         least 30 days prior written notice to Secured Party prior to any
         modification or cancellation thereof; shall name Secured Party as loss
         payee or additional insured, as applicable, and shall be payable to
         Debtors and Secured Party as their interests may appear; shall waive
         any claim for premium against Secured Party; and shall provide that no
         breach of warranty or representation or act or omission of Debtors
         shall terminate, limit or affect the insurers' liability to Secured
         Party. Certificates of insurance or policies evidencing the insurance
         required hereunder along with satisfactory proof of the payment of the
         premiums therefor shall be delivered to Secured Party. Debtors shall
         give immediate written notice to Secured Party and to insurers of loss
         or damage to the Collateral and shall promptly file proofs of loss with
         insurers. Debtors hereby irrevocably appoint Secured Party as Debtors'
         attorney-in-fact, coupled with an interest, for the purpose of
         obtaining, adjusting and canceling any such insurance and endorsing
         settlement drafts. Debtors hereby assign to Secured Party, as
         additional security for the Indebtedness, all sums which may become
         payable under such insurance.

         In the event Debtors fail to provide Secured Party with evidence of the
         insurance coverage required by this Agreement, Secured Party may
         purchase insurance at Debtors' expense to protect Secured Party's
         interests in the Collateral. This insurance may, but need not, protect
         Debtors' interests. The coverage purchased by Secured Party may not pay
         any claim made by Debtors or any claim that is made against Debtors in
         connection with the Collateral. Debtors may later cancel any insurance
         purchased by Secured Party, but only after providing Secured Party with
         evidence that Debtors have obtained insurance as required by this
         Agreement. If Secured Party purchases insurance for the Collateral,
         Debtors will be responsible for the costs of that insurance, including
         interest and other charges imposed by Secured Party in connection with
         the placement of the insurance, until the effective date of the
         cancellation or expiration of the insurance. The costs of the insurance
         may be added to the Indebtedness. The costs of the insurance may be
         more than the cost of insurance Debtors are able to obtain on their
         own.

                  (f) If Collateral Attaches to Real Estate. If the Collateral
         or any part thereof has been attached to or is to be attached to real
         estate, an accurate description of the real estate and the name and
         address of the record owner is set forth on the Schedule. Debtors
         shall, on demand of Secured Party, furnish Secured Party with a
         disclaimer or waiver of any interest in any such Collateral
         satisfactory to Secured Party and signed by all persons having an



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         interest in the real estate. Notwithstanding the foregoing, the
         Collateral shall remain personal property and shall not be affixed to
         realty without the prior written consent of Secured Party.

                  (g) Reporting Covenants.

                           (i) As soon as available and in any event within 120
                  days after the close of each fiscal year of Arabian Shield and
                  Texas Oil II (collectively, the "Reporting Guarantors"),
                  Debtors shall cause Reporting Guarantors to furnish to Secured
                  Party copies of the consolidated balance sheets of Reporting
                  Guarantors and their subsidiaries as of the close of such
                  fiscal year and consolidated statements of income,
                  shareholders' equity and the statements of cash flow of
                  Reporting Guarantors and their subsidiaries for such fiscal
                  year, in each case setting forth in comparative form the
                  figures for the preceding fiscal year, all in reasonable
                  detail and accompanied by an unqualified opinion thereon of an
                  independent public accounting firm of recognized national
                  standing selected by Reporting Guarantors and satisfactory to
                  Secured Party in its sole discretion to the effect that such
                  financial statements have been prepared in accordance with
                  generally accepted accounting principles ("GAAP") and that the
                  examination of such accounts in connection with such financial
                  statements has been made in accordance with generally accepted
                  auditing standards.

                           (ii) As soon as available and in any event within 45
                  days after the close of each fiscal quarter of Reporting
                  Guarantors, Debtors shall cause Reporting Guarantors to
                  furnish to Secured Party copies of the consolidated and
                  consolidating balance sheets of Reporting Guarantors and their
                  subsidiaries as of the close of such fiscal quarter,
                  consolidated and consolidating statements of income and
                  consolidated statements of cash flow of Reporting Guarantors
                  and their subsidiaries for the portion of the year then ended,
                  in each case setting forth in comparative form the figures for
                  the preceding year.

                           (iii) Debtors shall notify Secured Party in writing
                  of any Event of Default (as defined herein) and of any
                  "default" or "event of default" under any indebtedness or
                  performance obligations to any other person or entity
                  immediately upon Debtors becoming aware of such event or
                  events.

                           (iv) Debtors shall provide to Secured Party, and will
                  cause Guarantors to provide, promptly following any request by
                  Secured Party, such other financial information and reports
                  concerning Debtors or Guarantors, or any or some of them, as
                  Secured Party may from time to time request, in each case
                  being in such form and detail as Secured Party may require.

                           (v) Debtors will cause the Guarantors to deliver all
                  reports, financial information, and other information required
                  to be delivered by the



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                           Guarantors to Secured Party under the terms of the
                           Guaranty or any other agreement between Secured Party
                           and the Guarantors.

                  (h) Authorization. Each Debtor is now, and will at all times
         remain, a corporation duly organized, validly existing and in good
         standing under the laws of the respective jurisdiction of its
         formation. Each Debtor is now, and will at all times remain, duly
         licensed, qualified to do business and in good standing as a foreign
         corporation in every jurisdiction where failure to be so licensed or
         qualified and in good standing would have a material adverse effect on
         its respective business, properties or assets. The execution and
         delivery of this Agreement and the other Loan Documents (to the extent
         not inconsistent herewith) have been duly authorized by each Debtor and
         each Guarantor and constitute the legal, valid and binding obligations
         of each Debtor, enforceable against each Debtor, jointly and severally,
         in accordance with their respective terms. Each Debtor shall preserve
         and maintain its existence and shall not wind up its affairs or
         otherwise dissolve. Each Debtor shall not, without 30 days prior
         written notice to Secured Party, (1) change its respective name or so
         change its structure such that any financing statement or other record
         notice becomes misleading or (2) change its principal place of business
         or chief executive or accounting offices from the address stated
         herein.

                  (i) Litigation. Except as disclosed by Debtors in writing
         prior to the Advance, there are no judgments outstanding against or
         affecting Debtors, their officers, directors or affiliates or any part
         of the Collateral and there are no actions, charges, claims, demands,
         suits, proceedings, or investigations pending or threatened against
         Debtors or otherwise affecting any part of the Collateral
         ("Litigation"). Debtors shall furnish to Secured Party all information
         regarding any material Litigation as Secured Party shall reasonably
         request and in any event shall promptly notify Secured Party in writing
         of any Litigation against it which if decided against it would
         materially and adversely affect the finances or operations of Debtors.
         For the purposes of this subsection 6(i), any claim (or claims in the
         aggregate, if relating to the same event) which exceeds $1,000,000 and
         are not fully covered by in-force insurance shall be deemed material.

                  (j) No Conflicts. No Debtor is in violation of any material
         term or provision of its respective by-laws, or of any material
         agreement or instrument, decree, order, or any statute, rule, or
         governmental regulation applicable to it. The execution, delivery and
         performance of the Loan Documents do not and will not violate,
         constitute a default under, or otherwise conflict with any such term or
         provision or result in the creation of any security interest, lien,
         charge, or encumbrance upon any of the properties or assets of each
         Debtor, except for the security interest created hereunder.

                  (k) Compliance with Laws. Debtors shall use and maintain the
         Collateral in accordance with all applicable laws, regulations,
         ordinances, and codes and shall otherwise comply in all material
         respects with all applicable laws, rules, and regulations and duly
         observe all valid requirements of all governmental authorities, and all
         statutes, rules and regulations relating to its business as now in
         effect and which may be imposed in the future.



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                  (l) Taxes. Each Debtor has timely filed all tax returns
         (federal, state, local, and foreign) required to be filed by it and has
         paid or established reserves for all taxes, assessments, fees, and
         other governmental charges in respect of its properties, assets, income
         and franchises. Each Debtor shall promptly file, pay and discharge all
         taxes, assessments, license fees (related to the Collateral) and other
         governmental charges prior to the date on which penalties are attached
         thereto, establish adequate reserves for the payments of such taxes,
         assessments, and other governmental charges and make all required
         withholding and other tax deposits, and, upon request, provide Secured
         Party with receipts or other proof that any or all of such taxes,
         assessments, license fees or governmental charges have been paid in a
         timely fashion; provided, however, that nothing contained herein shall
         require the payment of any tax, assessment, or other governmental
         charge so long as its validity is being diligently contested in good
         faith and by appropriate proceedings diligently conducted and each
         Debtor has established cash reserves therefor in accordance with GAAP.
         Should any stamp, excise, or other tax, including mortgage, conveyance,
         deed, intangible, or recording taxes become payable in connection with
         or respect of any of the Loan Documents, Debtors shall pay the same
         (including interest and penalties, if any) and shall hold Secured Party
         harmless with respect thereto.

                  (m) Environmental Laws/Compliance. Except as disclosed by
         Debtor in writing prior to the Advance, no Debtor (1) has received any
         claim, summons, complaint, order, or other notice that it is not in
         compliance with, or that any public authority is investigating its
         compliance with, any federal, state, and local laws, rules,
         regulations, orders, and decrees relating to pollution, hazardous
         substances, waste, disposal or the protection of human health or
         safety, plant life or animal life, natural resources or the
         environment, all as amended from time to time (collectively,
         "Environmental Laws"), (2) has any knowledge of any material violation
         of any Environmental Laws on or about its assets or property, and (3)
         is under any current clean up or other remediation program or order.
         Except as disclosed by Debtor in writing prior to the Advance, each
         Debtor has obtained all environmental, health and safety permits
         necessary for the operation of its business. Except as disclosed by
         Debtor in writing prior to the Advance, Debtors are and shall remain in
         compliance, in all respects, with the terms and conditions of all
         permits and with all applicable Environmental Laws. Debtors shall
         provide Secured Party, promptly following receipt, copies of any
         correspondence, notice, complaint, order, or other document that any
         Debtor receives asserting or alleging a circumstance or condition which
         requires or may require a cleanup, removal, remedial action or other
         response by or on the part of any Debtor under any Environmental Laws,
         or which seeks damages or civil, criminal or punitive penalties from
         any Debtor for an alleged violation of any Environmental Laws. Debtors
         will promptly notify Secured Party of any release, spill or material
         change in the nature or extent of any hazardous substances or
         contaminants used, transported or stored by Debtors or any subsidiary
         of any Debtor, and will allow no material change in the use,
         transportation or storage thereof or in Debtors' operations that would
         increase in any material amount the risk of violation of any
         Environmental Laws, without the prior written approval of Secured
         Party.

                  (n) Regulations. No proceeds of the loans or any other
         financial accommodation hereunder will be used, directly or indirectly,
         for the purpose of purchasing or carrying any



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         margin security, as that term is defined in Regulations T, U, X of the
         Board of Governors of the Federal Reserve System.

                  (o) Books and Records. Debtors shall maintain, at all times,
         true and complete books and records in accordance with GAAP and
         consistent with those applied in the preparation of their respective
         financial statements. At all reasonable times, upon reasonable notice,
         and during normal business hours, Debtors shall permit Secured Party or
         its agents to audit, examine and make extracts from or copies of any of
         its books, ledgers, reports, correspondence, and other records relating
         to the Collateral.

                  (p) Setoff. Without limiting any other right of Secured Party,
         whenever Secured Party has the right to declare any Indebtedness to be
         immediately due and payable (whether or not it has so declared),
         Secured Party is hereby authorized at any time and from time to time to
         the fullest extent permitted by law, but shall not be obligated to, set
         off and apply against any and all Indebtedness, any and all monies then
         or thereafter owed to any Debtor by Secured Party, whether or not the
         obligation to pay such monies owed by Secured Party is then due. An
         election by Secured Party to exercise its right of setoff shall be
         effective immediately upon such election even though any charge
         therefor is made or entered on Secured Party's records subsequent
         thereto.

                  (q) Standard of Care; Notice of Claims. Debtors acknowledges
         and agrees that Secured Party shall not be liable for any acts or
         omissions nor for any error of judgment or mistake of fact or law other
         than as a sole and direct result of Secured Party's gross negligence or
         willful misconduct. Debtors shall give Secured Party written notice of
         any action or inaction by Secured Party or any agent or attorney of
         Secured Party that may give rise to a claim against Secured Party or
         any agent or attorney of Secured Party or that may be a defense to
         payment of the Indebtedness or performance hereunder for any reason,
         including commission of a tort (subject, in any event, to the first
         sentence of this paragraph) or violation of any contractual duty or
         duty implied by law. Debtors agree that unless such notice is fully
         given as promptly as possible (and in any event within 30 days) after
         any Debtor has knowledge, or with the exercise of reasonable diligence
         should have had knowledge, of any such action or inaction, no Debtor
         shall assert, and each Debtor shall be deemed to have waived, any claim
         or defense arising therefrom.

                  (r) Indemnity. Each Debtor shall indemnify, defend and hold
         Secured Party, its parent, affiliates, officers, directors, agents,
         employees, consultants, persons engaged by Secured Party to evaluate or
         monitor the Collateral, auditors and attorneys harmless from and
         against any loss, cost, expense (including reasonable attorneys' fees
         and costs and any consultants' or other experts' fees and expenses),
         damage, penalty, fine, claim, lien, suit, judgment or liability of
         every kind and nature arising directly or indirectly out of (i) any
         Loan Document, (ii) the ownership, possession, lease, operation, use,
         condition, sale, return, or other disposition of the Collateral, except
         to the extent the loss, expense, damage or liability arises solely and
         directly from Secured Party's gross negligence or willful misconduct,
         (iii) any Environmental Laws, and (iv) the enforcement by Secured Party
         of its rights or remedies



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         hereunder. Any payments required to be made hereunder shall constitute
         additional Indebtedness secured by the Collateral and shall be due and
         payable on demand.

                  (s) Payments Set Aside. If any payment is made to Secured
         Party or Secured Party enforces its security interest or exercises its
         right of set off, and such payment or part, or any proceeds of such
         enforcement or set off are subsequently invalidated, declared to be
         fraudulent or preferential, set aside and/or required to be repaid to a
         trustee, receiver or any other party under any bankruptcy law, state or
         federal law, common law or equitable cause, then to the extent of such
         recovery, the Indebtedness or part thereof originally intended to be
         satisfied, and all liens, security interests, rights and remedies
         therefor, shall be revived and continued in full force and effect as if
         such payment had not been made or such enforcement or set off had not
         occurred.

                  (t) Expenses and Attorneys' Fees. Debtors shall be liable for
         all charges, costs, taxes, expenses and reasonable attorneys' fees
         incurred by Secured Party: (i) in perfecting, defending, protecting or
         terminating its security interest in the Collateral, or any part
         thereof; (ii) subject to the limitations in this Agreement, in the
         negotiation, execution, delivery, administration, amendment or
         enforcement of the Loan Documents or the collection of any amounts due
         under any Note or other Loan Document; (iii) in any lawsuit or other
         legal proceeding in any way connected with any of the Loan Documents,
         including any contract or tort or other actions, any arbitration or
         other alternative dispute resolution proceeding, all appeals and
         judgment enforcement actions and any bankruptcy proceeding (including
         any relief from stay and/or adequate protection motions, cash
         collateral disputes, assumption/rejection motions and disputes or
         objections to any proposed disclosure statement or reorganization plan)
         and (iv) subject to the limitations in this Agreement, in appraising
         the Collateral and performing Secured Party's credit review, due
         diligence, and inspection of Collateral.

                  (u) Complete Information. No representation or warranty made
         by any Debtor in any Loan Document and no other document or statement
         now or hereafter furnished to Secured Party by or on behalf of any
         Debtor contains or will contain any misstatement of a material fact or
         omit to state any material fact which would make the statements
         contained therein misleading. Except as expressly set forth in writing
         and delivered to Secured Party prior to the Advance, there is no fact
         known to any Debtor that has or could have a materially adverse affect
         on the business, operation, condition (financial or otherwise),
         performance, properties or prospects of any Debtor or any Debtor's
         ability to timely pay all of the Indebtedness and perform all of its
         other obligations contained in or secured by this Agreement.

                  (v) Collateral Documentation. Debtors shall deliver to Secured
         Party prior to the Advance, satisfactory documentation regarding the
         Collateral to be financed, including such invoices, canceled checks
         evidencing payments, or other documentation as may be reasonably
         requested by Secured Party. Additionally, Debtors shall satisfy Secured
         Party that Debtors' business and financial information is as has been
         represented and there has been no material change in either Debtor's
         business, financial condition, or operations.



                                       10
<PAGE>   11

                  (w) Year 2000 Compliance. Each Debtor has made an assessment
         of the microchip and computer-based systems and the software used in
         its business and based upon such assessment believes that it will be
         "Year 2000 Compliant" by January 1, 2000. For purposes of this
         paragraph, "Year 2000 Compliant" means that all software, embedded
         microchips and other processing capabilities utilized by, and material
         to the business operations or financial condition of, each Debtor are
         able to interpret, store, transmit, receive and manipulate data on and
         involving all calendar dates correctly and without causing any abnormal
         ending scenarios in relation to dates in and after the Year 2000.

                  (x) No Additional Indebtedness. No Debtor will incur, create,
         assume, guarantee or permit to exist any indebtedness or liability,
         whether for borrowed money, for the deferred purchase price of
         property, as a contingent liability or otherwise, other than the
         Revolving Facility (defined herein) and the financing by South Hampton
         of insurance premiums. After the Coin Acquisition, the Debtors will not
         permit Coin to incur, create, assume, guarantee or permit to exist any
         indebtedness or liability, whether for borrowed money, for the deferred
         purchase price of property, as a contingent liability or otherwise,
         other than indebtedness of Coin for borrowed money existing on the date
         hereof and any refinancings (but not increases) of such indebtedness.

                  (y) No Liens. Debtors will not permit any Liens to exist as to
         the Collateral, the Real Property or any other assets of Debtors, other
         than (i) Liens on accounts receivable and inventory to secure the
         Revolving Facility, and (ii) Liens in favor of Secured Party. After the
         Coin Acquisition, the Debtors will not permit any Liens to exist on any
         property or assets of Coin, except for Liens granted to secure
         indebtedness of Coin permitted under Section 6(x) above, so long as
         such Liens only encumber the assets currently encumbered by such Liens.

                  (z) Real Property Lien. At Secured Party's request, South
         Hampton will grant to Secured Party a first priority deed of trust Lien
         on the South Hampton Refinery (as defined on the Schedule). The deed of
         trust evidencing such Lien shall be in form and substance satisfactory
         to Secured Party. Debtors will pay all fees and expenses incurred in
         connection therewith, including without limitation reasonable
         attorneys' fees and fees and expenses incurred in connection with any
         environmental appraisals, title policies and reports and other due
         diligence deemed necessary or advisable by Secured Party.

                  (aa) Distributions and Dividends. Debtors shall not upstream
         funds or make distributions of any kind, including loans, payables or
         intercompany advances, unless, at the time of such upstreaming, making
         or advancing no Event of Default exists and EBITDA (as defined below)
         for the trailing 12-month period is greater than $4,000,000, provided,
         however, that such prohibition shall not apply to ordinary course of
         business transactions among Texas Oil II, South Hampton, Gulf State and
         Coin. EBITDA shall mean, for Texas Oil II, South Hampton, Gulf State
         and Coin, on a consolidated basis, for any period, the sum of (i) net
         income before income tax and franchise taxes, plus (ii) depreciation,
         plus (iii) amortization, plus (iv) interest expense. In addition,
         Debtors shall not pay dividends or any other payments of any kind to
         their respective shareholders in or for any fiscal quarter, other than
         such dividends or payments which do not exceed (in aggregate) the
         lesser of



                                       11
<PAGE>   12

         (i) $150,000 or (ii) 50% of EBITDA minus interest expense for the
         quarter that the dividends are paid; provided that no such dividends or
         payments shall be allowed if Debtors and Guarantors are not in
         compliance with the Loan Documents or an Event of Default exists or
         would result from the making of such dividend or payment.

                  (bb) Working Capital Facility. South Hampton shall maintain a
         working capital credit facility in an amount not less than $2,000,000,
         with terms and conditions and from a lender acceptable to Secured Party
         in its reasonable discretion (the "Revolving Facility"), and Secured
         Party acknowledges that the current working capital facility maintained
         with Southwest Bank of Texas, N.A. is acceptable.

                  (cc) Revolving Facility Covenants. South Hampton agrees to
         comply with all of the terms, conditions and covenants in the documents
         evidencing or relating to the Revolving Facility.

         7. Events of Default. If any one of the following events (each of which
is herein called an "Event of Default") shall occur: (a) any Debtor or Guarantor
fails to pay any part of the Indebtedness when, or (b) any warranty or
representation of any Debtor or Guarantor in any Loan Document is materially
untrue, misleading or inaccurate, or (c) any Debtor or Guarantor defaults in the
performance of the covenants contained in Section 6(g) (other than subsection
(iii) thereof) and such default shall continue for 30 days after Debtor shall
have received notice thereof, or (d) any Debtor or Guarantor defaults in the
performance of any other covenant contained in this Agreement or any other Loan
Document, or (e) any Debtor or Guarantor breaches or defaults in the payment or
performance of any debt or other obligation owed by it to Secured Party or any
affiliate of Secured Party, and Secured Party has (without being obligated to do
so) declared such event, an Event of Default hereunder, or (f) any Debtor or
Guarantor breaches or defaults in the payment or performance of any other debt
or other obligation, whether now or hereafter existing, including without
limitation payment and performance of such obligations under the Revolving
Facility, or (g) there shall be any change in (i) the beneficial ownership and
control, directly or indirectly, of any outstanding voting securities or other
interests entitled (without regard to the occurrence of any contingency) to
elect or appoint members of the board of directors or other managing body of any
Debtor or Guarantor (other than Arabian Shield) or (ii) the beneficial ownership
and control, directly or indirectly, through a transaction or series of related
transactions of the majority of the outstanding voting securities or other
interests entitled (without regard to the occurrence of any contingency) to
elect or appoint members of the board of directors or other managing body of
Arabian Shield (a "change of control") and Secured Party notifies Arabian Shield
that, in Secured Party's judgment, such change of control is detrimental to
Secured Party's interests, such Event of Default to become effective 10 days
after such notice is given, or there is any merger, consolidation, dissolution,
liquidation, winding up or sale or other transfer of all or substantially all of
the assets of any Debtor or Guarantor pursuant to which there is a change of
control or cessation of any Debtor or Guarantor or the business of either, or
(h) any money judgment (including any civil and criminal penalties and fines) is
entered or filed against any Debtor or Guarantor in excess of $1,000,000, or (i)
any Debtor or Guarantor shall file a voluntary petition in bankruptcy, shall
apply for or permit the appointment by consent or acquiescence of a receiver,
conservator, administrator, custodian or trustee for itself or all or a
substantial part of its property, shall make an assignment for the benefit of
creditors or shall



                                       12
<PAGE>   13

be unable, fail or admit in writing its inability to pay its debts generally as
such debts become due, or (j) there shall have been filed against any Debtor or
Guarantor an involuntary petition in bankruptcy or any Debtor or Guarantor shall
suffer or permit the involuntary appointment of a receiver, conservator,
administrator, custodian or trustee for all or a substantial part of its
property or the issuance of a warrant of attachment, diligence, execution or
similar process against all or any substantial part of its property; unless, in
each case, such petition, appointment or process is fully bonded against,
vacated or dismissed within 30 days from its effective date, but no later than
10 days prior to any proposed disposition of any assets pursuant to any such
proceeding, or (k) if there is a material adverse change in the business or
financial condition or prospects of any Debtor or Guarantor, then, and in any
such event, Secured Party shall have the right to exercise any one or more of
the remedies hereinafter provided, or (j) if the Kingdom of Saudi Arabia's
Ministry of Finance or other governmental agency declares a default or demands
payment of the $11,000,000 note of Arabian Shield owing to the Kingdom of Saudi
Arabia and payment is not made within 90 days, or any legal action is filed or
other judicial proceeding is taken to collect such note.

         8. Remedies. Upon the occurrence of an Event of Default, in addition to
all rights and remedies of a secured party under the Uniform Commercial Code,
Secured Party may, at its option, at any time (a) declare the Indebtedness to be
immediately due and payable; (b) without demand or legal process, enter the
premises where the Collateral may be found and take possession of and remove the
Collateral, all without charge to or liability on the part of Secured Party; or
(c) require Debtors to assemble the Collateral, render it unusable, and crate,
pack, ship, and deliver the Collateral to Secured Party in such manner and at
such place as Secured Party may require, all at Debtors' sole cost and expense.
DEBTORS HEREBY EXPRESSLY WAIVE THEIR RIGHTS, IF ANY, TO (1) PRIOR NOTICE OF
REPOSSESSION AND (2) A JUDICIAL OR ADMINISTRATIVE HEARING PRIOR TO SUCH
REPOSSESSION. Secured Party may, at its option, ship, store and repair the
Collateral so removed and sell any or all of the Collateral at a public or
private sale or sales. Unless the Collateral is perishable or threatens to
decline speedily in value or is of a type customarily sold on a recognized
market, Secured Party will give Debtors reasonable notice of the time and place
of any public sale thereof or of the time after which any private sale or any
other intended disposition thereof is to be made, it being understood and agreed
that Secured Party may be a buyer at any such sale and no Debtor may, either
directly or indirectly, be a buyer at any such sale. The requirements, if any,
for reasonable notice will be met if such notice is mailed postage prepaid to
Debtors at their address shown above, at least five days before the time of sale
or disposition. After any such sale or disposition, Debtors shall be liable for
any deficiency of any Indebtedness remaining unpaid, with interest thereon at
the rate set forth in the Note.

         9. Cumulative Remedies/Marshaling. All remedies of Secured Party
hereunder and under the other Loan Documents are cumulative, are in addition to
any other remedies provided for by law or in equity, or under any other
provision of any of the Loan Documents, or under the provisions of any other
document, instrument or other writing executed by Debtors or any third party in
favor of Secured Party, all of which may, to the extent permitted by law, be
exercised concurrently or separately, and the exercise of any one remedy shall
not be deemed an election of such remedy or to preclude the exercise of any
other remedy. No failure on the part of Secured Party to exercise, and no delay
in exercising any right or remedy, shall operate as a waiver thereof or in any
way modify or be deemed to modify the terms of this Agreement or any other Loan
Document or the Indebtedness,



                                       13
<PAGE>   14

nor shall any single or partial exercise by Secured Party of any right or remedy
preclude any other or further exercise of the same or any other right or remedy.
Secured Party shall not be under any obligation to marshal any assets in favor
of Debtors, any Guarantor or any other person or against or in payment of any or
all of the Indebtedness.

          10. Assignment. Secured Party may transfer or assign all or any part
of the Indebtedness and the Loan Documents without releasing Debtors or the
Collateral, and upon such transfer or assignment the assignee or holder shall be
entitled to all the rights, powers, privileges and remedies of Secured Party to
the extent assigned or transferred. The obligations of Debtors shall not be
subject, as against any such assignee or transferee, to any defense, set-off, or
counter-claim available to Debtors against Secured Party and any such defense,
set-off, or counter-claim may be asserted only against Secured Party.

          11. Time is of the Essence. Time and manner of performance by Debtors
of their duties and obligations under the Loan Documents is of the essence. If
any Debtor shall fail to comply with any provision of any of the Loan Documents,
Secured Party shall have the right, but shall not be obligated, to take action
to address such non-compliance, in whole or in part, and all moneys spent and
expenses and obligations incurred or assumed by Secured Party shall be paid by
Debtors upon demand and shall be added to the Indebtedness. Any such action by
Secured Party shall not constitute a waiver of any Debtor's default.

          12. ENFORCEMENT. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS AND JUDICIAL DECISIONS OF THE STATE OF
ILLINOIS, WITHOUT REGARD TO THAT STATE'S PRINCIPLES OF CONFLICTS OF LAWS.
DEBTORS HEREBY SUBMIT TO THE PERSONAL JURISDICTION OF ANY STATE OR FEDERAL COURT
LOCATED WITHIN COOK COUNTY, ILLINOIS, AND IRREVOCABLY AGREES THAT, SUBJECT TO
SECURED PARTY'S ELECTION (AND WITHOUT LIMITING SECURED PARTY'S RIGHT TO COMMENCE
AN ACTION IN ANY OTHER JURISDICTION), ALL ACTIONS OR PROCEEDINGS ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS SHALL BE
LITIGATED IN SUCH COURTS. EACH DEBTOR ACCEPTS FOR ITSELF AND IN CONNECTION WITH
ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF
THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS, AND
IRREVOCABLY AGREES TO BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS OR THE INDEBTEDNESS, SUBJECT TO ANY
RIGHTS OF APPEAL WHICH ANY DEBTOR MAY HAVE UNDER ILLINOIS LAW. WITHOUT LIMITING
ANY OTHER MANNER OF SERVICE AVAILABLE TO SECURED PARTY, EACH DEBTOR EXPRESSLY
WAIVES PERSONAL SERVICE OF PROCESS IN CONNECTION WITH ANY SUCH ACTION OR
PROCEEDING AND CONSENTS TO SERVICE BY CERTIFIED MAIL, POSTAGE PREPAID, DIRECTED
TO THE LAST KNOWN ADDRESS OF DEBTORS, WHICH SERVICE SHALL BE DEEMED COMPLETED
WITHIN 10 DAYS AFTER THE DATE OF MAILING THEREOF.

         13. Further Assurance; Notice. Debtors shall at their expense, execute
and deliver such documents and do such further acts as Secured Party may from
time to time reasonably require to assure and confirm the rights created or
intended to be created hereunder, to carry out the intention or facilitate the
performance of the terms of the Loan Documents or to assure the validity,
perfection, priority or enforceability of any security interest created
hereunder. Debtors agree to execute any instrument or instruments necessary or
expedient for filing, recording, perfecting, notifying, foreclosing, and/or
liquidating of Secured Party's interest in the Collateral upon request of, and
as



                                       14
<PAGE>   15

determined by, Secured Party, and Debtors hereby specifically authorize Secured
Party to prepare and file Uniform Commercial Code financing statements and other
documents and to execute same for and on behalf of Debtors as Debtors'
attorney-in-fact, irrevocably and coupled with an interest, for such purposes.
All notices required or otherwise given by either party shall be in writing and
shall be delivered by hand, by registered or certified first class United States
mail, return receipt requested, or by overnight courier to the other party at
its address stated herein or at such other address as the other party may from
time to time designate by written notice. All notices shall be deemed given when
received, when delivery is refused or when returned for failure to be called
for. Each provision of this Agreement shall remain in full force and effect
until all of the Indebtedness is fully, finally and indefeasibly satisfied and,
notwithstanding anything in this Agreement or implied by law to the contrary,
the agreements of Debtors and Secured Party set forth in Section 6(q) shall
survive the full, final and indefeasible satisfaction of the Indebtedness.

          14. WAIVER OF JURY TRIAL. DEBTORS AND SECURED PARTY HEREBY WAIVE THEIR
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING IN CONNECTION WITH ANY OF THE LOAN DOCUMENTS. DEBTORS AND SECURED PARTY
ACKNOWLEDGE THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS
RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THE WAIVER IN ENTERING INTO THE
LOAN DOCUMENTS, AND THAT EACH WILL CONTINUE TO RELY ON THE WAIVER IN THEIR
RELATED FUTURE DEALINGS. DEBTORS AND SECURED PARTY FURTHER WARRANT AND REPRESENT
THAT EACH HAS REVIEWED THIS WAIVER WITH THEIR LEGAL COUNSEL AND THAT EACH
KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION
WITH LEGAL COUNSEL.

          15. Joint and Several Obligation. If this Agreement is executed by
more than one person as Debtor, each such Debtor hereby acknowledges it is
jointly and severally liable for and unconditionally guarantees the prompt and
full payment and performance of all obligations of each other Debtor hereunder
and under the other Loan Documents.

          16. Complete Agreement. The Loan Documents embody the entire agreement
among the parties hereto superseding all prior commitments, agreements,
representations, and understandings, whether written or oral relating to the
subject matter hereof, and may not be contradicted or varied by evidence of
prior, contemporaneous, or subsequent oral agreements or discussions of the
parties hereto. The Loan Documents may not be altered, modified or terminated in
any manner except by a writing duly signed by the parties thereto. Debtors and
Secured Party intend the Loan Documents to be valid and binding and no
provisions hereof and thereof which may be deemed unenforceable shall in any way
invalidate any other provisions of the Loan Documents, all of which shall remain
in full force and effect. The Loan Documents shall be binding upon the
respective successors, legal representatives, and assigns of the parties. This
Agreement may be executed in multiple counterparts, each of which will be deemed
an original, but which together shall constitute the same document.

         17. Publication. Secured Party shall (at Secured Party's sole expense)
have the right to secure printed publicity concerning the transactions
contemplated by this Agreement through newspapers, brochures, and other media.

                            [signature page follows]



                                       15
<PAGE>   16

         IN WITNESS WHEREOF, Secured Party and Debtors have each signed this
Agreement as of the day and year first above written.

                                       HELLER FINANCIAL LEASING, INC.


                                       By:
                                          --------------------------------------
                                          Name:
                                          Title:


                                       SOUTH HAMPTON REFINING CO.


                                       By:
                                          --------------------------------------
                                          Nicholas N. Carter
                                          President

                                       GULF STATE PIPELINE COMPANY, INC.


                                       By:
                                          --------------------------------------
                                          Nicholas N. Carter
                                          President






                           LOAN AND SECURITY AGREEMENT
                                 SIGNATURE PAGE



<PAGE>   17

                                   SCHEDULE 1

                                   Collateral


      The Collateral shall, in part, consist of all present and future
machinery, equipment, storage tanks, truck and rail loading terminal and
equipment, transportation equipment, and all other equipment including all
improvements, attachments, substitutions, additions, replacements, and proceeds
thereof (cash and non-cash) now owned or hereafter acquired which is located at
7752 FM 418, Silsbee, Texas 77656 and such other locations as such assets may be
located.

Record Owner: South Hampton Refining Co.


Legal Description of Real Estate to which certain Collateral is attached:
[See attached]



<PAGE>   18

                                    EXHIBIT A


                                  Form of Note

<PAGE>   19
                                                              Loan No.:________



                                 PROMISSORY NOTE


$3,500,000.00                                                  December 30, 1999

     FOR VALUE RECEIVED, SOUTH HAMPTON REFINING CO., a Texas corporation, and
GULF STATE PIPE LINE COMPANY, INC., a Texas corporation ("Makers"), jointly and
severally, promise to pay to the order of HELLER FINANCIAL LEASING, INC., a
Delaware corporation (together with any holder of this Note, "Payee"), at its
office located at 500 West Monroe Street, Chicago, Illinois 60661, or at such
other place as Payee may from time to time designate, the principal sum of THREE
MILLION FIVE HUNDRED THOUSAND and 00/100 Dollars ($3,500,000.00), together with
interest thereon at a fixed rate equal to 10.55% per annum. Principal and
interest shall be payable in 47 consecutive monthly installments commencing
February 1, 2000 and continuing on the same day of each consecutive calendar
month thereafter until this Note is fully paid, each such installment in the
amount of EIGHTY-NINE THOUSAND SIX HUNDRED NINETY-SIX and 37/100 Dollars
($89,696.37); provided, however, that in any and all events the final
installment payment hereunder shall be in the amount of the entire then
outstanding principal balance hereunder, plus all accrued and unpaid interest,
charges and other amounts owing hereunder or under the Security Agreement
(defined below). All payments shall be applied first to interest and then to
principal. Interest shall be computed on the basis of a 360 day year comprised
of 30-day months.

     Notwithstanding the foregoing, if at any time implementation of any
provision hereof shall cause the interest contracted for or charged herein or
collectable hereunder to exceed the applicable lawful maximum rate, then the
interest shall be limited to such applicable lawful maximum.

     This Note is secured by, among other things, the collateral described in
the Loan and Security Agreement dated as of the date hereof between Makers and
Payee (the "Loan and Security Agreement;" and together with all related
documents and instruments, the "Loan Documents"), and other Loan Documents, to
which reference is made for a statement of the nature and extent of protection
and security afforded, certain rights of Payee and certain rights and
obligations of Makers, including Makers' rights, if any, to prepay the principal
balance hereof; provided, however, that in addition to any other sum payable
hereunder, under the Loan and Security Agreement or any of the other Loan
Documents, in the event of a prepayment of the principal balance hereunder,
whether voluntary, following acceleration or otherwise, Makers shall pay to
Payee together with such prepayment a Breakage Fee (defined below), which
Breakage Fee, together with the amounts payable under Section 4 of the Loan and
Security Agreement, if any, represents liquidated damages to Payee for the loss
of its bargain and not a penalty. As used herein, the term "Breakage Fee" shall
mean the amount, if any, by which (A) the present value, in the aggregate, of
the then remaining installments of principal and interest due hereunder, absent
the prepayment, using a discount rate equal to (i) the yield to maturity as of
the date two (2) days prior to the date of the prepayment on United States
Treasury securities with a final maturity approximately equal to the remaining
term hereof, absent the prepayment, as published in The Wall Street Journal,
plus (ii) one percent (1.00%), exceeds (B) the then outstanding principal
balance hereunder, absent the prepayment.

     Time is of the essence hereof. If payment of any installment or any other
sum due under this Note or the Loan Documents is not paid when due, Makers
jointly and severally agree to pay a late charge equal to the lesser of (i) five
cents (5 cent) per dollar on, and in addition to, the amount of each such
payment, or (ii) the maximum amount Payee is permitted to charge by law. In the
event of the occurrence of an Event of Default (as defined in the Loan and
Security Agreement), then the entire unpaid principal balance hereof with
accrued and unpaid interest thereon, together with all other sums payable under
this Note or the Loan Documents, shall, at the option of Payee and without
notice or demand, become immediately due and payable, such accelerated balance
bearing interest until paid at the rate of five and 00/100 percent (5.00%) per
annum above the fixed rate set forth in the first paragraph of this Note.



<PAGE>   20



     Makers and all endorsers, guarantors or any others who may at any time
become liable for the payment hereof hereby consent to any and all extensions of
time, renewals, waivers and modifications of, and substitutions or release of
security or of any party primarily or secondarily liable on, or with respect to,
this Note or any of the Loan Documents or any of the terms and provisions
thereof that may be made, granted or consented to by Payee, and agree that suit
may be brought and maintained against any one or more of them, at the election
of Payee, without joinder of the others as parties thereto, and that Payee shall
not be required to first foreclose, proceed against, or exhaust any security
herefor, in order to enforce payment of this Note by any one or more of them.
Makers and all endorsers, guarantors or any others who may at any time become
liable for the payment hereof hereby severally waive presentment, demand for
payment, notice of nonpayment, protest, notice of protest, notice of dishonor,
and all other notices in connection with this Note, filing of suit and diligence
in collecting this Note or enforcing any of the security herefor, and, without
limiting any provision of any of the Loan Documents, agree to pay, if permitted
by law, all expenses incurred in collection, including reasonable attorneys'
fees, and hereby waive all benefits of valuation, appraisement and exemption
laws.

     If there be more than one Maker, all the obligations, promises, agreements
and covenants of Maker under this Note are joint and several.

     THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS AND DECISIONS OF THE STATE OF ILLINOIS WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW. AT PAYEE'S ELECTION AND WITHOUT LIMITING PAYEE'S
RIGHT TO COMMENCE AN ACTION IN ANY OTHER JURISDICTION, MAKERS HEREBY SUBMIT TO
THE EXCLUSIVE JURISDICTION AND VENUE OF ANY COURT (FEDERAL, STATE OR LOCAL)
HAVING SITUS WITHIN THE STATE OF ILLINOIS, EXPRESSLY WAIVES PERSONAL SERVICE OF
PROCESS AND CONSENTS TO SERVICE BY CERTIFIED MAIL, POSTAGE PREPAID, DIRECTED TO
THE LAST KNOWN ADDRESS OF MAKERS, WHICH SERVICE SHALL BE DEEMED COMPLETED WITHIN
TEN (10) DAYS AFTER THE DATE OF MAILING THEREOF.

     MAKERS HEREBY WAIVE THEIR RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF THIS NOTE. THIS WAIVER IS INFORMED AND
FREELY MADE. MAKERS ACKNOWLEDGE THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO
ENTER INTO A BUSINESS RELATIONSHIP, THAT PAYEE HAS ALREADY RELIED ON THE WAIVER
IN MAKING THE LOAN EVIDENCED BY THIS NOTE, AND THAT PAYEE WILL CONTINUE TO RELY
ON THE WAIVER IN ITS RELATED FUTURE DEALINGS. MAKERS FURTHER WARRANT AND
REPRESENT THAT THEY HAVE REVIEWED THIS WAIVER WITH LEGAL COUNSEL AND THAT THEY
KNOWINGLY AND VOLUNTARILY WAIVE THEIR JURY TRIAL RIGHTS FOLLOWING CONSULTATION
WITH LEGAL COUNSEL.



                                   MAKERS:

                                   SOUTH HAMPTON REFINING CO.


                                   By:
                                      ----------------------------------------
                                       Nicholas N. Carter
                                       President

                                   GULF STATE PIPELINE COMPANY, INC.


                                   By:
                                      ----------------------------------------
                                       Nicholas N. Carter
                                       President

<PAGE>   21
                                                          Loan No. _____________

                                    GUARANTY

         For valuable consideration, the receipt whereof is hereby acknowledged,
and to induce HELLER FINANCIAL LEASING, INC., a Delaware corporation ("Lender"),
to make loans or advances, or extend credit or financial accommodations to SOUTH
HAMPTON REFINING CO. and GULF STATE PIPE LINE COMPANY, INC. ("Debtors"), or to
continue the same, but without requiring Lender to do so, the undersigned,
ARABIAN SHIELD DEVELOPMENT COMPANY, a Delaware corporation (hereinafter called
"Guarantor"), promises to pay to Lender, on demand, in lawful money of the
United States, the due and punctual payment and performance of all indebtedness
of Debtors to Lender no matter how acquired by Lender. The word "indebtedness"
is used herein in its most comprehensive sense and includes any and all loans or
performance obligations, notes, security agreements and liabilities of Debtors
to Lender including those existing, now or hereafter made, entered into,
incurred, created or owing, however arising, whether due or not due, absolute or
contingent, liquidated or unliquidated, determined or undetermined, and whether
Debtors may be liable individually or jointly with others, or whether recovery
upon such indebtedness may be or hereafter become barred by any statute of
limitations, or whether such indebtedness may be or hereafter become otherwise
unenforceable, including without limitation indebtedness of Debtors to Lender
under that certain Loan and Security Agreement of even date herewith by and
among Debtors and Lender (the "Loan Agreement"). This is a guaranty of payment
and performance and not of collection. Guarantor's obligations hereunder shall
be unconditional (and shall not be subject to any defense, setoff, counterclaim
or recoupment whatsoever) irrespective of the genuineness, validity, regularity
or enforceability of the indebtedness or any conduct of Debtors and/or Lender
which might constitute a legal or equitable discharge of a surety, guarantor or
guaranty.

         This is an absolute, unconditional and continuing guaranty relating to
the indebtedness, including that arising under successive transactions which
shall either continue the indebtedness or from time to time renew it after it
has been satisfied or create new indebtedness. This Guaranty shall not apply to
any indebtedness created after actual receipt by Lender of written notice of its
revocation as to future transactions, except that indebtedness committed to
prior to such date but consummated and actually created subsequent to such date
shall be covered hereby.

         The obligations hereunder are joint and several, independent of the
obligations of Debtors or the obligations of any other person(s) or guarantor(s)
who may be liable to Lender in whole or in part for the indebtedness, and a
separate action or actions may be brought and prosecuted against Guarantor or
any of them whether action is brought against Debtors alone or whether Debtors
be joined in any such action or actions; and Guarantor waives the benefit of any
statute of limitations affecting its liability hereunder or the enforcement
thereof.

         Guarantor authorizes Lender, without notice or consent and without
affecting, impairing or discharging in whole or in part its liability hereunder,
from time to time to (a) renew, modify, amend, compromise, extend, accelerate,
discharge or otherwise change the


<PAGE>   22

time for payment of, or otherwise change the terms or provisions of the
indebtedness or any part thereof, including increasing or decreasing the rate of
interest thereon; (b) take and hold collateral for the payment of this Guaranty
or the indebtedness guaranteed, and exchange, enforce, waive, and release any
such collateral; (c) apply such collateral and direct the order or manner of
sale thereof as Lender in its discretion may determine; or (d) release or
substitute in whole or in part any one or more of the endorsers, Guarantor or
anyone else who may be partially or wholly liable for any part of the
indebtedness. Lender may without notice assign this Guaranty in whole or in
part.

         Guarantor waives any right to require Lender to (a) proceed against or
exhaust remedies against Debtors; (b) proceed against or exhaust any collateral
given by Debtors or Guarantor; (c) pursue any other remedy in Lender's power
whatsoever; or (d) proceed against any other person(s) or guarantor(s) who may
be liable to Lender in whole or in part for the indebtedness. Guarantor waives
any defense arising by reason of any disability or other defense of Debtors or
by reason of the cessation or modification from any cause whatsoever of the
liability of Debtors. Guarantor waives diligence, all presentments, demands for
performance, notices of non-performance, default, protests, notices of protest,
notices of dishonor, notices of acceptance of this Guaranty and of the
existence, creation, or incurring of new, changed, modified, increased or
additional indebtedness, and all other notices of every and any kind. GUARANTOR
HEREBY WAIVES ANY AND ALL NOTICE OF LENDER'S INTENT TO ACCELERATE THE
INDEBTEDNESS AND FURTHER WAIVES ANY NOTICE OF ACCELERATION.

         Lender shall have a claim and a right of setoff against all moneys,
securities and other property of Guarantor now or hereafter in the possession of
Lender whether held in a special account for safekeeping or otherwise, and such
right of setoff may be exercised without demand upon Guarantor or notice by
Lender. No right of setoff shall be deemed to have been waived by any act or
conduct on the part of Lender or by any neglect to exercise such right of setoff
or by any delay in so doing, and every right of setoff shall continue in full
force and effect until such right of setoff is specifically waived or released
by an instrument in writing executed by Lender.

         Guarantor waives and agrees not to assert any claim Guarantor may now
or later have against Debtors until such time as the indebtedness is fully,
finally and indefeasibly paid to Lender. Guarantor agrees that this paragraph is
intended to benefit Debtors and is relied upon by Lender. As used in this
paragraph, the term 'claim' is defined in the Bankruptcy Code, Section 101.
Guarantor further hereby irrevocably waives and releases any right of
subrogation (whether contractual, under Section 509 of the Bankruptcy Code or
otherwise), reimbursement, contribution, exoneration, or other similar right, or
indemnity, or any right of recourse to collateral for any of the indebtedness
until such time as the indebtedness is fully, finally and indefeasibly paid to
Lender.

         Guarantor agrees to pay reasonable attorneys' fees and all other costs
and expenses which may be incurred by Lender in the enforcement of this Guaranty
or otherwise relating to this Guaranty including, without limitation, in
connection with any lawsuit, arbitration or other alternative dispute resolution
proceeding, appeal, judgment enforcement action, bankruptcy proceeding
(including, without limitation, any relief from stay and/or adequate

                                       2
<PAGE>   23

protection motions, cash collateral disputes, assumption/rejection motions and
disputes or objections to any proposed disclosure statement or reorganization
plan) or other legal proceeding in any way related to this Guaranty. Guarantor
acknowledges and agrees that the preceding sentence shall survive and not be
merged with any judgment in connection with any exercise of any right or remedy
by Lender in connection with this Guaranty. Guarantor further agrees that all
reasonable attorneys' fees, costs and expenses incurred in pursuing or enforcing
rights and/or any collateral or security shall constitute so much additional
indebtedness hereby guaranteed.

         Guarantor hereby expressly agrees to deliver any and all information
required to be delivered by Guarantor under Section 6(g) of the Loan Agreement,
and Guarantor hereby expressly affirms the representations contained in, and
agrees to comply with the agreements and covenants set forth in, 6(h), 6(i),
6(j), 6(k), 6(l), 6(m), 6(u) and 6(w) of the Loan Agreement to the same extent
as if such provisions were contained herein and Guarantor were the "Debtor"
named therein.

         Guarantor further agrees that this Guaranty shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, on the indebtedness is rescinded or must otherwise be restored by
Lender upon the bankruptcy or reorganization of Debtors or otherwise.

         Any indebtedness of Debtors now or hereafter held by or owing to
Guarantor is hereby subordinated to Lender and such indebtedness, if requested
by Lender, shall be collected, enforced, and received by Guarantor as trustee
for Lender and promptly paid over to Lender.

         In this Guaranty, the singular shall include the plural, the plural
shall include the singular, and the use of any gender shall be applicable to all
genders. If any Guarantor is a corporation, by executing and delivering this
Guaranty, it and the officers thereof signing on its behalf represent and
warrant that the execution and delivery of this Guaranty has been duly
authorized by all necessary and appropriate corporate and shareholder action.

         In case any one or more of the provisions contained in this Guaranty
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby.

         Guarantor agrees to notify Lender promptly upon learning that a "change
of control" (as defined in the Loan Agreement) with respect to Guarantor has
occurred or is imminent.

         Guarantor consents and agrees that, without notice to or by Guarantor
and without affecting or impairing in any way the obligations or liability of
Guarantor hereunder, Lender may, from time to time before or after revocation of
this Guaranty, exercise any right or remedy it may have with respect to any or
all of the indebtedness or any property securing any or all of the indebtedness
or any guaranty thereof, including, without limitation, judicial foreclosure,
nonjudicial foreclosure, exercise of a power of sale, and taking a deed,
assignment or transfer in lieu of foreclosure as to any such property, and
Guarantor expressly


                                       3
<PAGE>   24

waives any defense based upon the exercise of any such right or remedy,
notwithstanding the effect thereof upon any of Guarantor's rights, including,
without limitation, any destruction of Guarantor's right of subrogation against
Debtors and any destruction of Guarantor's right of contribution or other right
against any other guarantor of any or all of the indebtedness or against any
other person by operation of any statutes or rules of law now or hereafter in
effect, or otherwise.

         THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS AND JUDICIAL DECISIONS OF THE STATE OF ILLINOIS, WITHOUT REGARD TO
THAT STATE'S PRINCIPLES OF CONFLICTS OF LAWS. GUARANTOR HEREBY SUBMITS TO THE
PERSONAL JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED WITHIN COOK COUNTY,
ILLINOIS, AND IRREVOCABLY AGREES THAT, SUBJECT TO LENDER'S ELECTION (AND WITHOUT
LIMITING LENDER'S RIGHT TO COMMENCE AN ACTION IN ANY OTHER JURISDICTION), ALL
ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS GUARANTY SHALL BE
LITIGATED IN SUCH COURTS. GUARANTOR ACCEPTS FOR ITSELF AND IN CONNECTION WITH
ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF
THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS, AND
IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION
WITH THIS GUARANTY, SUBJECT TO SUCH RIGHT OF APPEAL AS GUARANTOR MAY BE ENTITLED
UNDER ILLINOIS LAW. WITHOUT LIMITING ANY OTHER MANNER OF SERVICE AVAILABLE TO
LENDER, GUARANTOR EXPRESSLY WAIVES PERSONAL SERVICE OF PROCESS IN CONNECTION
WITH ANY SUCH ACTION OR PROCEEDING AND CONSENTS TO SERVICE BY CERTIFIED MAIL,
POSTAGE PREPAID, DIRECTED TO THE LAST KNOWN ADDRESS OF GUARANTOR, WHICH SERVICE
SHALL BE DEEMED COMPLETED WITHIN TEN (10) DAYS AFTER THE DATE OF MAILING
THEREOF.

        [Remainder of page intentionally blank. Signature pages follow.]

                                       4
<PAGE>   25


         IN WITNESS WHEREOF, the undersigned Guarantor, and each of them (if
there be more than one), has executed and delivered this Guaranty independent of
each other and not relying upon or in consideration of the execution hereof
by any other of them, on this 30th day of December, 1999.







                                        GUARANTOR:

                                        ARABIAN SHIELD DEVELOPMENT COMPANY


                                        By:
                                           -------------------------------------
                                           Hatem El-Khalidi
                                           President and Chief Executive Officer





                                    GUARANTY
                                 SIGNATURE PAGE






<PAGE>   26



                                                          Loan No.______________

                                    GUARANTY

     For valuable consideration, the receipt whereof is hereby acknowledged, and
to induce HELLER FINANCIAL LEASING, INC., a Delaware corporation ("Lender"), to
make loans or advances, or extend credit or financial accommodations to SOUTH
HAMPTON REFINING CO. and GULF STATE PIPE LINE COMPANY, INC. ("Debtors"), or to
continue the same, but without requiring Lender to do so, the undersigned,
AMERICAN SHIELD REFINING COMPANY, a Delaware corporation (hereinafter called
"Guarantor"), promises to pay to Lender, on demand, in lawful money of the
United States, the due and punctual payment and performance of all indebtedness
of Debtors to Lender no matter how acquired by Lender. The word "indebtedness"
is used herein in its most comprehensive sense and includes any and all loans or
performance obligations, notes, security agreements and liabilities of Debtors
to Lender including those existing, now or hereafter made, entered into,
incurred, created or owing, however arising, whether due or not due, absolute or
contingent, liquidated or unliquidated, determined or undetermined, and whether
Debtors may be liable individually or jointly with others, or whether recovery
upon such indebtedness may be or hereafter become barred by any statute of
limitations, or whether such indebtedness may be or hereafter become otherwise
unenforceable, including without limitation indebtedness of Debtors to Lender
under that certain Loan and Security Agreement of even date herewith by and
among Debtors and Lender (the "Loan Agreement"). This is a guaranty of payment
and performance and not of collection. Guarantor's obligations hereunder shall
be unconditional (and shall not be subject to any defense, setoff, counterclaim
or recoupment whatsoever) irrespective of the genuineness, validity, regularity
or enforceability of the indebtedness or any conduct of Debtors and/or Lender
which might constitute a legal or equitable discharge of a surety, guarantor or
guaranty.

     This is an absolute, unconditional and continuing guaranty relating to the
indebtedness, including that arising under successive transactions which shall
either continue the indebtedness or from time to time renew it after it has been
satisfied or create new indebtedness. This Guaranty shall not apply to any
indebtedness created after actual receipt by Lender of written notice of its
revocation as to future transactions, except that indebtedness committed to
prior to such date but consummated and actually created subsequent to such date
shall be covered hereby.

     The obligations hereunder are joint and several, independent of the
obligations of Debtors or the obligations of any other person(s) or guarantor(s)
who may be liable to Lender in whole or in part for the indebtedness, and a
separate action or actions may be brought and prosecuted against Guarantor or
any of them whether action is brought against Debtors alone or whether Debtors
be joined in any such action or actions; and Guarantor waives the benefit of any
statute of limitations affecting its liability hereunder or the enforcement
thereof.

     Guarantor authorizes Lender, without notice or consent and without
affecting, impairing or discharging in whole or in part its liability hereunder,
from time to time to (a) renew, modify, amend, compromise, extend, accelerate,
discharge or otherwise change the



<PAGE>   27
time for payment of, or otherwise change the terms or provisions of the
indebtedness or any part thereof, including increasing or decreasing the rate of
interest thereon; (b) take and hold collateral for the payment of this Guaranty
or the indebtedness guaranteed, and exchange, enforce, waive, and release any
such collateral; (c) apply such collateral and direct the order or manner of
sale thereof as Lender in its discretion may determine; or (d) release or
substitute in whole or in part any one or more of the endorsers, Guarantor or
anyone else who may be partially or wholly liable for any part of the
indebtedness. Lender may without notice assign this Guaranty in whole or in
part.

     Guarantor waives any right to require Lender to (a) proceed against or
exhaust remedies against Debtors; (b) proceed against or exhaust any collateral
given by Debtors or Guarantor; (c) pursue any other remedy in Lender's power
whatsoever; or (d) proceed against any other person(s) or guarantor(s) who may
be liable to Lender in whole or in part for the indebtedness. Guarantor waives
any defense arising by reason of any disability or other defense of Debtors or
by reason of the cessation or modification from any cause whatsoever of the
liability of Debtors. Guarantor waives diligence, all presentments, demands for
performance, notices of non_performance, default, protests, notices of protest,
notices of dishonor, notices of acceptance of this Guaranty and of the
existence, creation, or incurring of new, changed, modified, increased or
additional indebtedness, and all other notices of every and any kind. GUARANTOR
HEREBY WAIVES ANY AND ALL NOTICE OF LENDER'S INTENT TO ACCELERATE THE
INDEBTEDNESS AND FURTHER WAIVES ANY NOTICE OF ACCELERATION.

     Lender shall have a claim and a right of setoff against all moneys,
securities and other property of Guarantor now or hereafter in the possession of
Lender whether held in a special account for safekeeping or otherwise, and such
right of setoff may be exercised without demand upon Guarantor or notice by
Lender. No right of setoff shall be deemed to have been waived by any act or
conduct on the part of Lender or by any neglect to exercise such right of setoff
or by any delay in so doing, and every right of setoff shall continue in full
force and effect until such right of setoff is specifically waived or released
by an instrument in writing executed by Lender.

     Guarantor waives and agrees not to assert any claim Guarantor may now or
later have against Debtors until such time as the indebtedness is fully, finally
and indefeasibly paid to Lender. Guarantor agrees that this paragraph is
intended to benefit Debtors and is relied upon by Lender. As used in this
paragraph, the term 'claim' is defined in the Bankruptcy Code, Section 101.
Guarantor further hereby irrevocably waives and releases any right of
subrogation (whether contractual, under Section 509 of the Bankruptcy Code or
otherwise), reimbursement, contribution, exoneration, or other similar right, or
indemnity, or any right of recourse to collateral for any of the indebtedness
until such time as the indebtedness is fully, finally and indefeasibly paid to
Lender.

     Guarantor agrees to pay reasonable attorneys' fees and all other costs and
expenses which may be incurred by Lender in the enforcement of this Guaranty or
otherwise relating to this Guaranty including, without limitation, in connection
with any lawsuit, arbitration or other alternative dispute resolution
proceeding, appeal, judgment enforcement action, bankruptcy proceeding
(including, without limitation, any relief from stay and/or adequate

                                       2

<PAGE>   28


protection motions, cash collateral disputes, assumption/rejection motions and
disputes or objections to any proposed disclosure statement or reorganization
plan) or other legal proceeding in any way related to this Guaranty. Guarantor
acknowledges and agrees that the preceding sentence shall survive and not be
merged with any judgment in connection with any exercise of any right or remedy
by Lender in connection with this Guaranty. Guarantor further agrees that all
reasonable attorneys' fees, costs and expenses incurred in pursuing or enforcing
rights and/or any collateral or security shall constitute so much additional
indebtedness hereby guaranteed.

     Guarantor hereby expressly agrees to deliver any and all information
required to be delivered by Guarantor under Section 6(g) of the Loan Agreement,
and Guarantor hereby expressly affirms the representations contained in, and
agrees to comply with the agreements and covenants set forth in, 6(h), 6(i),
6(j), 6(k), 6(l), 6(m), 6(u) and 6(w) of the Loan Agreement to the same extent
as if such provisions were contained herein and Guarantor were the "Debtor"
named therein.

     Guarantor further agrees that this Guaranty shall continue to be effective
or be reinstated, as the case may be, if at any time payment, or any part
thereof, on the indebtedness is rescinded or must otherwise be restored by
Lender upon the bankruptcy or reorganization of Debtors or otherwise.

     Any indebtedness of Debtors now or hereafter held by or owing to Guarantor
is hereby subordinated to Lender and such indebtedness, if requested by Lender,
shall be collected, enforced, and received by Guarantor as trustee for Lender
and promptly paid over to Lender.

     In this Guaranty, the singular shall include the plural, the plural shall
include the singular, and the use of any gender shall be applicable to all
genders. If any Guarantor is a corporation, by executing and delivering this
Guaranty, it and the officers thereof signing on its behalf represent and
warrant that the execution and delivery of this Guaranty has been duly
authorized by all necessary and appropriate corporate and shareholder action.

     In case any one or more of the provisions contained in this Guaranty should
be invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein shall not in any way
be affected or impaired thereby.

     Guarantor consents and agrees that, without notice to or by Guarantor and
without affecting or impairing in any way the obligations or liability of
Guarantor hereunder, Lender may, from time to time before or after revocation of
this Guaranty, exercise any right or remedy it may have with respect to any or
all of the indebtedness or any property securing any or all of the indebtedness
or any guaranty thereof, including, without limitation, judicial foreclosure,
nonjudicial foreclosure, exercise of a power of sale, and taking a deed,
assignment or transfer in lieu of foreclosure as to any such property, and
Guarantor expressly
                                       3

<PAGE>   29
 waives any defense based upon the exercise of any such right or remedy,
notwithstanding the effect thereof upon any of Guarantor's rights, including,
without limitation, any destruction of Guarantor's right of subrogation against
Debtors and any destruction of Guarantor's right of contribution or other right
against any other guarantor of any or all of the indebtedness or against any
other person by operation of any statutes or rules of law now or hereafter in
effect, or otherwise.

     THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS AND JUDICIAL DECISIONS OF THE STATE OF ILLINOIS, WITHOUT REGARD TO
THAT STATE'S PRINCIPLES OF CONFLICTS OF LAWS. GUARANTOR HEREBY SUBMITS TO THE
PERSONAL JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED WITHIN COOK COUNTY,
ILLINOIS, AND IRREVOCABLY AGREES THAT, SUBJECT TO LENDER'S ELECTION (AND WITHOUT
LIMITING LENDER'S RIGHT TO COMMENCE AN ACTION IN ANY OTHER JURISDICTION), ALL
ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS GUARANTY SHALL BE
LITIGATED IN SUCH COURTS. GUARANTOR ACCEPTS FOR ITSELF AND IN CONNECTION WITH
ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF
THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS, AND
IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION
WITH THIS GUARANTY, SUBJECT TO SUCH RIGHT OF APPEAL AS GUARANTOR MAY BE ENTITLED
UNDER ILLINOIS LAW. WITHOUT LIMITING ANY OTHER MANNER OF SERVICE AVAILABLE TO
LENDER, GUARANTOR EXPRESSLY WAIVES PERSONAL SERVICE OF PROCESS IN CONNECTION
WITH ANY SUCH ACTION OR PROCEEDING AND CONSENTS TO SERVICE BY CERTIFIED MAIL,
POSTAGE PREPAID, DIRECTED TO THE LAST KNOWN ADDRESS OF GUARANTOR, WHICH SERVICE
SHALL BE DEEMED COMPLETED WITHIN TEN (10) DAYS AFTER THE DATE OF MAILING
THEREOF.

        [Remainder of page intentionally blank. Signature pages follow.]

                                       4

<PAGE>   30


     IN WITNESS WHEREOF, the undersigned Guarantor, and each of them (if there
be more than one), has executed and delivered this Guaranty independent of each
other and not relying upon or in consideration of the execution hereof by any
other of them, on this 30th day of December, 1999.


                                       GUARANTOR:

                                       AMERICAN SHIELD REFINING COMPANY


                                       By:
                                          --------------------------------------
                                          Hatem El-Khalidi
                                          President and Chief Executive Officer



                                    GUARANTY
                                 SIGNATURE PAGE
<PAGE>   31

                                                          Loan No. _____________

                                    GUARANTY

         For valuable consideration, the receipt whereof is hereby acknowledged,
and to induce HELLER FINANCIAL LEASING, INC., a Delaware corporation ("Lender"),
to make loans or advances, or extend credit or financial accommodations to SOUTH
HAMPTON REFINING CO. and GULF STATE PIPE LINE COMPANY, INC. ("Debtors"), or to
continue the same, but without requiring Lender to do so, the undersigned, TEXAS
OIL AND CHEMICAL CO. II, INC., a Texas corporation (hereinafter called
"Guarantor"), promises to pay to Lender, on demand, in lawful money of the
United States, the due and punctual payment and performance of all indebtedness
of Debtors to Lender no matter how acquired by Lender. The word "indebtedness"
is used herein in its most comprehensive sense and includes any and all loans or
performance obligations, notes, security agreements and liabilities of Debtors
to Lender including those existing, now or hereafter made, entered into,
incurred, created or owing, however arising, whether due or not due, absolute or
contingent, liquidated or unliquidated, determined or undetermined, and whether
Debtors may be liable individually or jointly with others, or whether recovery
upon such indebtedness may be or hereafter become barred by any statute of
limitations, or whether such indebtedness may be or hereafter become otherwise
unenforceable, including without limitation indebtedness of Debtors to Lender
under that certain Loan and Security Agreement of even date herewith by and
among Debtors and Lender (the "Loan Agreement"). This is a guaranty of payment
and performance and not of collection. Guarantor's obligations hereunder shall
be unconditional (and shall not be subject to any defense, setoff, counterclaim
or recoupment whatsoever) irrespective of the genuineness, validity, regularity
or enforceability of the indebtedness or any conduct of Debtors and/or Lender
which might constitute a legal or equitable discharge of a surety, guarantor or
guaranty.

         This is an absolute, unconditional and continuing guaranty relating to
the indebtedness, including that arising under successive transactions which
shall either continue the indebtedness or from time to time renew it after it
has been satisfied or create new indebtedness. This Guaranty shall not apply to
any indebtedness created after actual receipt by Lender of written notice of its
revocation as to future transactions, except that indebtedness committed to
prior to such date but consummated and actually created subsequent to such date
shall be covered hereby.

         The obligations hereunder are joint and several, independent of the
obligations of Debtors or the obligations of any other person(s) or guarantor(s)
who may be liable to Lender in whole or in part for the indebtedness, and a
separate action or actions may be brought and prosecuted against Guarantor or
any of them whether action is brought against Debtors alone or whether Debtors
be joined in any such action or actions; and Guarantor waives the benefit of any
statute of limitations affecting its liability hereunder or the enforcement
thereof.

         Guarantor authorizes Lender, without notice or consent and without
affecting, impairing or discharging in whole or in part its liability hereunder,
from time to time to (a) renew, modify, amend, compromise, extend, accelerate,
discharge or otherwise change the



<PAGE>   32

time for payment of, or otherwise change the terms or provisions of the
indebtedness or any part thereof, including increasing or decreasing the rate of
interest thereon; (b) take and hold collateral for the payment of this Guaranty
or the indebtedness guaranteed, and exchange, enforce, waive, and release any
such collateral; (c) apply such collateral and direct the order or manner of
sale thereof as Lender in its discretion may determine; or (d) release or
substitute in whole or in part any one or more of the endorsers, Guarantor or
anyone else who may be partially or wholly liable for any part of the
indebtedness. Lender may without notice assign this Guaranty in whole or in
part.

         Guarantor waives any right to require Lender to (a) proceed against or
exhaust remedies against Debtors; (b) proceed against or exhaust any collateral
given by Debtors or Guarantor; (c) pursue any other remedy in Lender's power
whatsoever; or (d) proceed against any other person(s) or guarantor(s) who may
be liable to Lender in whole or in part for the indebtedness. Guarantor waives
any defense arising by reason of any disability or other defense of Debtors or
by reason of the cessation or modification from any cause whatsoever of the
liability of Debtors. Guarantor waives diligence, all presentments, demands for
performance, notices of non-performance, default, protests, notices of protest,
notices of dishonor, notices of acceptance of this Guaranty and of the
existence, creation, or incurring of new, changed, modified, increased or
additional indebtedness, and all other notices of every and any kind. GUARANTOR
HEREBY WAIVES ANY AND ALL NOTICE OF LENDER'S INTENT TO ACCELERATE THE
INDEBTEDNESS AND FURTHER WAIVES ANY NOTICE OF ACCELERATION.

         Lender shall have a claim and a right of setoff against all moneys,
securities and other property of Guarantor now or hereafter in the possession of
Lender whether held in a special account for safekeeping or otherwise, and such
right of setoff may be exercised without demand upon Guarantor or notice by
Lender. No right of setoff shall be deemed to have been waived by any act or
conduct on the part of Lender or by any neglect to exercise such right of setoff
or by any delay in so doing, and every right of setoff shall continue in full
force and effect until such right of setoff is specifically waived or released
by an instrument in writing executed by Lender.

         Guarantor waives and agrees not to assert any claim Guarantor may now
or later have against Debtors until such time as the indebtedness is fully,
finally and indefeasibly paid to Lender. Guarantor agrees that this paragraph is
intended to benefit Debtors and is relied upon by Lender. As used in this
paragraph, the term 'claim' is defined in the Bankruptcy Code, Section 101.
Guarantor further hereby irrevocably waives and releases any right of
subrogation (whether contractual, under Section 509 of the Bankruptcy Code or
otherwise), reimbursement, contribution, exoneration, or other similar right, or
indemnity, or any right of recourse to collateral for any of the indebtedness
until such time as the indebtedness is fully, finally and indefeasibly paid to
Lender.

         Guarantor agrees to pay reasonable attorneys' fees and all other costs
and expenses which may be incurred by Lender in the enforcement of this Guaranty
or otherwise relating to this Guaranty including, without limitation, in
connection with any lawsuit, arbitration or other alternative dispute resolution
proceeding, appeal, judgment enforcement action, bankruptcy proceeding
(including, without limitation, any relief from stay and/or adequate



                                       2
<PAGE>   33

protection motions, cash collateral disputes, assumption/rejection motions and
disputes or objections to any proposed disclosure statement or reorganization
plan) or other legal proceeding in any way related to this Guaranty. Guarantor
acknowledges and agrees that the preceding sentence shall survive and not be
merged with any judgment in connection with any exercise of any right or remedy
by Lender in connection with this Guaranty. Guarantor further agrees that all
reasonable attorneys' fees, costs and expenses incurred in pursuing or enforcing
rights and/or any collateral or security shall constitute so much additional
indebtedness hereby guaranteed.

         Guarantor hereby expressly agrees to deliver any and all information
required to be delivered by Guarantor under Section 6(g) of the Loan Agreement,
and Guarantor hereby expressly affirms the representations contained in, and
agrees to comply with the agreements and covenants set forth in, 6(h), 6(i),
6(j), 6(k), 6(l), 6(m), 6(u) and 6(w) of the Loan Agreement to the same extent
as if such provisions were contained herein and Guarantor were the "Debtor"
named therein.

         Guarantor further agrees that this Guaranty shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, on the indebtedness is rescinded or must otherwise be restored by
Lender upon the bankruptcy or reorganization of Debtors or otherwise.

         Any indebtedness of Debtors now or hereafter held by or owing to
Guarantor is hereby subordinated to Lender and such indebtedness, if requested
by Lender, shall be collected, enforced, and received by Guarantor as trustee
for Lender and promptly paid over to Lender.

         In this Guaranty, the singular shall include the plural, the plural
shall include the singular, and the use of any gender shall be applicable to all
genders. If any Guarantor is a corporation, by executing and delivering this
Guaranty, it and the officers thereof signing on its behalf represent and
warrant that the execution and delivery of this Guaranty has been duly
authorized by all necessary and appropriate corporate and shareholder action.

         In case any one or more of the provisions contained in this Guaranty
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby.

         Guarantor consents and agrees that, without notice to or by Guarantor
and without affecting or impairing in any way the obligations or liability of
Guarantor hereunder, Lender may, from time to time before or after revocation of
this Guaranty, exercise any right or remedy it may have with respect to any or
all of the indebtedness or any property securing any or all of the indebtedness
or any guaranty thereof, including, without limitation, judicial foreclosure,
nonjudicial foreclosure, exercise of a power of sale, and taking a deed,
assignment or transfer in lieu of foreclosure as to any such property, and
Guarantor expressly waives any defense based upon the exercise of any such right
or remedy, notwithstanding the effect thereof upon any of Guarantor's rights,
including, without limitation, any destruction of Guarantor's right of
subrogation against Debtors and any destruction of Guarantor's right


                                       3
<PAGE>   34
of contribution or other right against any other guarantor of any or all of the
indebtedness or against any other person by operation of any statutes or rules
of law now or hereafter in effect, or otherwise.

         THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS AND JUDICIAL DECISIONS OF THE STATE OF ILLINOIS, WITHOUT REGARD TO
THAT STATE'S PRINCIPLES OF CONFLICTS OF LAWS. GUARANTOR HEREBY SUBMITS TO THE
PERSONAL JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED WITHIN COOK COUNTY,
ILLINOIS, AND IRREVOCABLY AGREES THAT, SUBJECT TO LENDER'S ELECTION (AND WITHOUT
LIMITING LENDER'S RIGHT TO COMMENCE AN ACTION IN ANY OTHER JURISDICTION), ALL
ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS GUARANTY SHALL BE
LITIGATED IN SUCH COURTS. GUARANTOR ACCEPTS FOR ITSELF AND IN CONNECTION WITH
ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF
THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS, AND
IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION
WITH THIS GUARANTY, SUBJECT TO SUCH RIGHT OF APPEAL AS GUARANTOR MAY BE ENTITLED
UNDER ILLINOIS LAW. WITHOUT LIMITING ANY OTHER MANNER OF SERVICE AVAILABLE TO
LENDER, GUARANTOR EXPRESSLY WAIVES PERSONAL SERVICE OF PROCESS IN CONNECTION
WITH ANY SUCH ACTION OR PROCEEDING AND CONSENTS TO SERVICE BY CERTIFIED MAIL,
POSTAGE PREPAID, DIRECTED TO THE LAST KNOWN ADDRESS OF GUARANTOR, WHICH SERVICE
SHALL BE DEEMED COMPLETED WITHIN TEN (10) DAYS AFTER THE DATE OF MAILING
THEREOF.

        [Remainder of page intentionally blank. Signature pages follow.]



                                       4
<PAGE>   35

         IN WITNESS WHEREOF, the undersigned Guarantor, and each of them (if
there be more than one), has executed and delivered this Guaranty independent of
each other and not relying upon or in consideration of the execution hereof by
any other of them, on this 30th day of December, 1999.



                                       GUARANTOR:

                                       TEXAS OIL AND CHEMICAL CO. II, INC.


                                       By:
                                          --------------------------------------
                                          Nicholas N. Carter
                                          President






                                    GUARANTY
                                 SIGNATURE PAGE



<PAGE>   36
                                                          Loan No. _____________

                                    GUARANTY

         For valuable consideration, the receipt whereof is hereby acknowledged,
and to induce HELLER FINANCIAL LEASING, INC., a Delaware corporation ("Lender"),
to make loans or advances, or extend credit or financial accommodations to SOUTH
HAMPTON REFINING CO. and GULF STATE PIPELINE COMPANY, INC. ("Debtors"), or to
continue the same, but without requiring Lender to do so, the undersigned,
[___________________] (hereinafter called "Guarantor"), promises to pay to
Lender, on demand, in lawful money of the United States, the due and punctual
payment and performance of all indebtedness of Debtors to Lender no matter how
acquired by Lender. The word "indebtedness" is used herein in its most
comprehensive sense and includes any and all loans or performance obligations,
notes, security agreements and liabilities of Debtors to Lender including those
existing, now or hereafter made, entered into, incurred, created or owing,
however arising, whether due or not due, absolute or contingent, liquidated or
unliquidated, determined or undetermined, and whether Debtors may be liable
individually or jointly with others, or whether recovery upon such indebtedness
may be or hereafter become barred by any statute of limitations, or whether such
indebtedness may be or hereafter become otherwise unenforceable, including
without limitation indebtedness of Debtors to Lender under that certain Loan and
Security Agreement of even date herewith by and among Debtors and Lender (the
"Loan Agreement"). This is a guaranty of payment and performance and not of
collection. Guarantor's obligations hereunder shall be unconditional (and shall
not be subject to any defense, setoff, counterclaim or recoupment whatsoever)
irrespective of the genuineness, validity, regularity or enforceability of the
indebtedness or any conduct of Debtors and/or Lender which might constitute a
legal or equitable discharge of a surety, guarantor or guaranty.

         This is an absolute, unconditional and continuing guaranty relating to
the indebtedness, including that arising under successive transactions which
shall either continue the indebtedness or from time to time renew it after it
has been satisfied or create new indebtedness. This Guaranty shall not apply to
any indebtedness created after actual receipt by Lender of written notice of its
revocation as to future transactions, except that indebtedness committed to
prior to such date but consummated and actually created subsequent to such date
shall be covered hereby.

         The obligations hereunder are joint and several, independent of the
obligations of Debtors or the obligations of any other person(s) or guarantor(s)
who may be liable to Lender in whole or in part for the indebtedness, and a
separate action or actions may be brought and prosecuted against Guarantor or
any of them whether action is brought against Debtors alone or whether Debtors
be joined in any such action or actions; and Guarantor waives the benefit of any
statute of limitations affecting its liability hereunder or the enforcement
thereof.

         Guarantor authorizes Lender, without notice or consent and without
affecting, impairing or discharging in whole or in part its liability hereunder,
from time to time to (a) renew, modify, amend, compromise, extend, accelerate,
discharge or otherwise change the



<PAGE>   37

time for payment of, or otherwise change the terms or provisions of the
indebtedness or any part thereof, including increasing or decreasing the rate of
interest thereon; (b) take and hold collateral for the payment of this Guaranty
or the indebtedness guaranteed, and exchange, enforce, waive, and release any
such collateral; (c) apply such collateral and direct the order or manner of
sale thereof as Lender in its discretion may determine; or (d) release or
substitute in whole or in part any one or more of the endorsers, Guarantor or
anyone else who may be partially or wholly liable for any part of the
indebtedness. Lender may without notice assign this Guaranty in whole or in
part.

         Guarantor waives any right to require Lender to (a) proceed against or
exhaust remedies against Debtors; (b) proceed against or exhaust any collateral
given by Debtors or Guarantor; (c) pursue any other remedy in Lender's power
whatsoever; or (d) proceed against any other person(s) or guarantor(s) who may
be liable to Lender in whole or in part for the indebtedness. Guarantor waives
any defense arising by reason of any disability or other defense of Debtors or
by reason of the cessation or modification from any cause whatsoever of the
liability of Debtors. Guarantor waives diligence, all presentments, demands for
performance, notices of non-performance, default, protests, notices of protest,
notices of dishonor, notices of acceptance of this Guaranty and of the
existence, creation, or incurring of new, changed, modified, increased or
additional indebtedness, and all other notices of every and any kind. GUARANTOR
HEREBY WAIVES ANY AND ALL NOTICE OF LENDER'S INTENT TO ACCELERATE THE
INDEBTEDNESS AND FURTHER WAIVES ANY NOTICE OF ACCELERATION.

         Lender shall have a claim and a right of setoff against all moneys,
securities and other property of Guarantor now or hereafter in the possession of
Lender whether held in a special account for safekeeping or otherwise, and such
right of setoff may be exercised without demand upon Guarantor or notice by
Lender. No right of setoff shall be deemed to have been waived by any act or
conduct on the part of Lender or by any neglect to exercise such right of setoff
or by any delay in so doing, and every right of setoff shall continue in full
force and effect until such right of setoff is specifically waived or released
by an instrument in writing executed by Lender.

         Guarantor waives and agrees not to assert any claim Guarantor may now
or later have against Debtors until such time as the indebtedness is fully,
finally and indefeasibly paid to Lender. Guarantor agrees that this paragraph is
intended to benefit Debtors and is relied upon by Lender. As used in this
paragraph, the term 'claim' is defined in the Bankruptcy Code, Section 101.
Guarantor further hereby irrevocably waives and releases any right of
subrogation (whether contractual, under Section 509 of the Bankruptcy Code or
otherwise), reimbursement, contribution, exoneration, or other similar right, or
indemnity, or any right of recourse to collateral for any of the indebtedness
until such time as the indebtedness is fully, finally and indefeasibly paid to
Lender.

         Guarantor agrees to pay reasonable attorneys' fees and all other costs
and expenses which may be incurred by Lender in the enforcement of this Guaranty
or otherwise relating to this Guaranty including, without limitation, in
connection with any lawsuit, arbitration or other alternative dispute resolution
proceeding, appeal, judgment enforcement action, bankruptcy proceeding
(including, without limitation, any relief from stay and/or adequate



                                       2
<PAGE>   38

protection motions, cash collateral disputes, assumption/rejection motions and
disputes or objections to any proposed disclosure statement or reorganization
plan) or other legal proceeding in any way related to this Guaranty. Guarantor
acknowledges and agrees that the preceding sentence shall survive and not be
merged with any judgment in connection with any exercise of any right or remedy
by Lender in connection with this Guaranty. Guarantor further agrees that all
reasonable attorneys' fees, costs and expenses incurred in pursuing or enforcing
rights and/or any collateral or security shall constitute so much additional
indebtedness hereby guaranteed.

         Guarantor hereby expressly agrees to deliver any and all information
required to be delivered by Guarantor under Section 6(g) of the Loan Agreement,
and Guarantor hereby expressly affirms the representations contained in, and
agrees to comply with the agreements and covenants set forth in, 6(h), 6(i),
6(j), 6(k), 6(l), 6(m), 6(u) and 6(w) of the Loan Agreement to the same extent
as if such provisions were contained herein and Guarantor were the "Debtor"
named therein.

         Guarantor further agrees that this Guaranty shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, on the indebtedness is rescinded or must otherwise be restored by
Lender upon the bankruptcy or reorganization of Debtors or otherwise.

         Any indebtedness of Debtors now or hereafter held by or owing to
Guarantor is hereby subordinated to Lender and such indebtedness, if requested
by Lender, shall be collected, enforced, and received by Guarantor as trustee
for Lender and promptly paid over to Lender.

         In this Guaranty, the singular shall include the plural, the plural
shall include the singular, and the use of any gender shall be applicable to all
genders. If any Guarantor is a corporation, by executing and delivering this
Guaranty, it and the officers thereof signing on its behalf represent and
warrant that the execution and delivery of this Guaranty has been duly
authorized by all necessary and appropriate corporate and shareholder action.

         In case any one or more of the provisions contained in this Guaranty
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby.

         Guarantor consents and agrees that, without notice to or by Guarantor
and without affecting or impairing in any way the obligations or liability of
Guarantor hereunder, Lender may, from time to time before or after revocation of
this Guaranty, exercise any right or remedy it may have with respect to any or
all of the indebtedness or any property securing any or all of the indebtedness
or any guaranty thereof, including, without limitation, judicial foreclosure,
nonjudicial foreclosure, exercise of a power of sale, and taking a deed,
assignment or transfer in lieu of foreclosure as to any such property, and
Guarantor expressly waives any defense based upon the exercise of any such right
or remedy, notwithstanding the effect thereof upon any of Guarantor's rights,
including, without limitation, any destruction of Guarantor's right of
subrogation against Debtors and any destruction of Guarantor's right



                                       3
<PAGE>   39
of contribution or other right against any other guarantor of any or all of the
indebtedness or against any other person by operation of any statutes or rules
of law now or hereafter in effect, or otherwise.

         THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS AND JUDICIAL DECISIONS OF THE STATE OF ILLINOIS, WITHOUT REGARD TO
THAT STATE'S PRINCIPLES OF CONFLICTS OF LAWS. GUARANTOR HEREBY SUBMITS TO THE
PERSONAL JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED WITHIN COOK COUNTY,
ILLINOIS, AND IRREVOCABLY AGREES THAT, SUBJECT TO LENDER'S ELECTION (AND WITHOUT
LIMITING LENDER'S RIGHT TO COMMENCE AN ACTION IN ANY OTHER JURISDICTION), ALL
ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS GUARANTY SHALL BE
LITIGATED IN SUCH COURTS. GUARANTOR ACCEPTS FOR ITSELF AND IN CONNECTION WITH
ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF
THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS, AND
IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION
WITH THIS GUARANTY, SUBJECT TO SUCH RIGHT OF APPEAL AS GUARANTOR MAY BE ENTITLED
UNDER ILLINOIS LAW. WITHOUT LIMITING ANY OTHER MANNER OF SERVICE AVAILABLE TO
LENDER, GUARANTOR EXPRESSLY WAIVES PERSONAL SERVICE OF PROCESS IN CONNECTION
WITH ANY SUCH ACTION OR PROCEEDING AND CONSENTS TO SERVICE BY CERTIFIED MAIL,
POSTAGE PREPAID, DIRECTED TO THE LAST KNOWN ADDRESS OF GUARANTOR, WHICH SERVICE
SHALL BE DEEMED COMPLETED WITHIN TEN (10) DAYS AFTER THE DATE OF MAILING
THEREOF.

         IN WITNESS WHEREOF, the undersigned Guarantor, and each of them (if
there be more than one), has executed and delivered this Guaranty independent of
each other and not relying upon or in consideration of the execution hereof by
any other of them, on this _______ day of December, 1999.



                                       GUARANTOR:

                                       -----------------------------------------


                                       By:
                                          --------------------------------------
                                       Name:
                                       Title:



                                       4
<PAGE>   40
                                PLEDGE AGREEMENT


         THIS PLEDGE AGREEMENT dated as of December 30, 1999, is by and between
TEXAS OIL AND CHEMICAL CO. II, INC., a Texas corporation (the "Pledgor") whose
address is 7752 FM 418, P.O. Box 1636, Silsbee, Texas 77656, and HELLER
FINANCIAL LEASING, INC., a Delaware corporation (the "Secured Party"), whose
address is 500 West Monroe Street, C