INTERCREDITOR AGREEMENT

dated as of

December 15, 2017

among

SilverBow Resources, Inc.,
as Borrower,

each of the other GRANTORS party hereto,

JPMorgan Chase Bank, N.A.,
as First Lien Administrative Agent,

and

U.S. Bank National Association,
as Second Lien Collateral Agent

THIS IS THE INTERCREDITOR AGREEMENT REFERRED TO IN THE LOAN DOCUMENTS REFERRED
TO HEREIN.

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

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

TABLE OF CONTENTS
ARTICLE I DEFINITIONS
2

Section 1.01
Certain Defined Terms    2

Section 1.02
Other Defined Terms    2

Section 1.03
Terms Generally    12

ARTICLE II LIEN PRIORITIES
13

Section 2.01
Relative Priorities    13

Section 2.02
Prohibition on Contesting Liens    13

Section 2.03
No New Liens    14

Section 2.04
Similar Liens and Agreements    14

Section 2.05
Judgment Creditors    15

Section 2.06
Perfection of Liens    15

Section 2.07
No Debt Subordination    15

ARTICLE III ENFORCEMENT OF RIGHTS; MATTERS RELATING TO COLLATERAL
15

Section 3.01
Exercise of Rights and Remedies    15

Section 3.02
No Interference    19

Section 3.03
Rights as Unsecured Creditors    21

Section 3.04
Automatic Release of Second Priority Liens    21

Section 3.05
Notice of Exercise of Second Liens    22

Section 3.06
Insurance and Condemnation Awards    23

ARTICLE IV PAYMENTS
23

Section 4.01
Application of Proceeds    23

Section 4.02
Payment Over    23

Section 4.03
Certain Agreements with Respect to Unenforceable

Liens    24
ARTICLE V BAILMENT
25

Section 5.01
Bailment for Perfection of Certain Security Interests    25

Section 5.02
Bailment for Perfection of Certain Security Interests – Other Control Collateral
(Second Liens)    26

ARTICLE VI INSOLVENCY PROCEEDINGS
27

Section 6.01
Finance and Sale Matters    27

Section 6.02
Relief from the Automatic Stay    30

Section 6.03
Reorganization Securities    30

Section 6.04
Post-Petition Interest    30

Section 6.05
Certain Waivers by the Second Lien Secured Parties    31

Section 6.06
Certain Voting Matters    31

Section 6.07
Separate Grants of Security and Separate Classification    31

-i-

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

ARTICLE VII OTHER AGREEMENTS
32

Section 7.01
Matters Relating to Loan Documents    32

Section 7.02
Effect of Refinancing of Indebtedness    34

Section 7.03
No Waiver by First Lien Secured Parties    35

Section 7.04
Reinstatement    35

Section 7.05
Further Assurances    36

Section 7.06
Notice of Exercise of Remedies    36

ARTICLE VIII REPRESENTATIONS AND WARRANTIES
36

Section 8.01
Representations and Warranties of Each Party    36

Section 8.02
Representations and Warranties of First Lien Administrative Agent and Second
Lien Collateral Agent    37

ARTICLE IX NO RELIANCE; NO LIABILITY; OBLIGATIONS
ABSOLUTE
37

Section 9.01
No Reliance; Information    37

Section 9.02
No Warranties or Liability    38

Section 9.03
Obligations Absoluate    38

ARTICLE X MISCELLANEOUS
39

Section 10.01
Notices    39

Section 10.02
Conflicts    41

Section 10.03
Effectiveness; Survival    41

Section 10.04
Severability    41

Section 10.05
Amendments; Waivers    41

Section 10.06
Subrogation    42

Section 10.07
Applicable Law; Jurisdiction; Consent to Service of Process    42

Section 10.08
Waiver of Jury Trial    42

Section 10.09
Parties in Interest    43

Section 10.10
Specific Performance    43

Section 10.11
Headings    43

Section 10.12
Counterparts    43

Section 10.13
Provisions Solely to Define Relative Rights    43

Section 10.14
Sharing of Information    44

Section 10.15
Agents    44

Section 10.16
No Indirect Actions    44

Annex I
Provisions for the Second Lien Note Purchase Agreement and Certain Second Lien
Collateral Documents

Annex II
Form of Assumption Agreement

-ii-

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

INTERCREDITOR AGREEMENT dated as of December 15, 2017 (as amended, restated,
amended and restated, supplemented or otherwise modified from time to time in
accordance with the terms hereof, this “Agreement”), among SilverBow Resources,
Inc. (f/k/a Swift Energy Company), a Delaware corporation (the “Borrower”), each
of the undersigned Grantors (as defined below), JPMorgan Chase Bank, N.A., as
agent for the First Lien Secured Parties (as defined below) (in such capacity,
together with its successors and assigns in such capacity, the “First Lien
Administrative Agent”) and U.S. Bank National Association, in its capacity as
“Agent” under the Second Lien Note Purchase Agreement (as defined below) for the
Second Lien Secured Parties (as defined below) (in such capacity, together with
its successors and assigns in such capacity, the “Second Lien Collateral
Agent”).
PRELIMINARY STATEMENT
Reference is made to (a) the First Amended and Restated Credit Agreement dated
as April 19, 2017 (as amended, restated, amended and restated, supplemented,
modified or Refinanced from time to time in accordance with the terms of this
Agreement, the “First Lien Credit Agreement”), among the Borrower, the lenders
from time to time party thereto (the “First Lien Lenders”) and the First Lien
Administrative Agent, (b) the Note Purchase Agreement dated as of even date
hereof (as amended, restated, amended and restated, supplemented, modified or
Refinanced from time to time in accordance with the terms of this Agreement, the
“Second Lien Note Purchase Agreement”), by and among the Borrower, holders from
time to time party thereto and the Second Lien Collateral Agent, and (c) the
Security Documents referred to in the First Lien Credit Agreement and the Second
Lien Note Purchase Agreement.
RECITALS
A.    Pursuant to (i) the First Lien Credit Agreement, the Borrower and certain
of its Subsidiaries entered, and agreed to cause certain current and future
Subsidiaries to enter, into (A) the First Amended and Restated Guaranty and
Collateral Agreement, dated as of April 19, 2017 (as may be amended, restated,
amended and restated, supplements or otherwise modified from time to time) to
guarantee the First Lien Secured Obligations and grant a security interest in
favor of the First Lien Administrative Agent to secure such obligations and (B)
certain other First Lien Security Documents, including mortgages, to secure such
First Lien Secured Obligations and (ii) the Second Lien Note Purchase Agreement,
the Borrower and certain of its Subsidiaries are entering into, and agreed to
cause certain current and future Subsidiaries to enter into, (A) the Second Lien
Guaranty and Collateral Agreement (as may be amended, restated, amended and
restated, supplements or otherwise modified from time to time), dated as of the
date hereof, to guarantee the Second Lien Secured Obligations and grant a
security interest in favor of the Second Lien Collateral Agent to secure such
obligations and (B) certain other Second Lien Security Documents, including
mortgages, to secure such Second Lien Secured Obligations;
B.    The obligations of (i) the Borrower under the First Lien Credit Agreement,
(ii) the Borrower and/or any Guarantor under any Swap Agreements with Secured
Swap

1

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

Providers, (iii) the Borrower and/or any Guarantor with respect to any Cash
Management Agreements entered into with any Secured Cash Management Bank and
(iv) any guarantees of the Borrower and the other Guarantors under the First
Lien Security Documents will be secured on a first lien priority basis by
security interests and liens granted by the Borrower and each Grantor on the
Collateral, pursuant to the terms of the First Lien Security Documents;
C.    The obligations of the Borrower under the Second Lien Note Purchase
Agreement and the guarantees of the Guarantors under the Second Lien Collateral
Documents will be secured on a second lien priority basis by security interests
and liens granted by the Borrower and each Grantor on the Collateral, pursuant
to the terms of the Second Lien Collateral Documents;
D.    The First Lien Loan Documents (as defined below) and the Second Lien Note
Documents (as defined below) provide, among other things, that the parties
thereto shall set forth in this Agreement their respective rights and remedies
with respect to the Collateral; and
E.    In consideration of the foregoing, the mutual covenants and obligations
herein set forth and for other good and valuable consideration, the sufficiency
and receipt of which are hereby acknowledged, each of the First Lien
Administrative Agent (on behalf of each First Lien Secured Party) and the Second
Lien Collateral Agent (on behalf of each Second Lien Secured Party), intending
to be legally bound, hereby agrees as follows:
ARTICLE I

DEFINITIONS
Section 1.01    Certain Defined Terms. Terms defined above shall have the
meanings ascribed to them. Unless otherwise indicated, capitalized terms used
but not defined herein shall have the meaning given such terms in the First Lien
Credit Agreement as in effect as of the date hereof; and, if not defined
therein, such terms shall have the meaning given such terms in the Second Lien
Note Purchase Agreement as in effect as of the date hereof. As used in this
Agreement, the following terms shall have the following meanings:
Section 1.02    Other Defined Terms. As used in the Agreement, the following
terms shall have the meanings specified below:
“Additional First Lien Administrative Agent” shall have the meaning assigned to
such term in Section 7.02(a).
“Additional First Lien Loan Documents” shall have the meaning assigned to such
term in Section 7.02(a).
“Additional First Lien Obligations” shall have the meaning assigned to such term
in Section 7.02(a).

2

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

“Additional Second Lien Collateral Agent” shall have the meaning assigned to
such term in Section 7.02(b).
“Additional Second Lien Note Documents” shall have the meaning assigned to such
term in Section 7.02(b).
“Additional Second Lien Obligations” shall have the meaning assigned to such
term in Section 7.02(b).
“Affiliate” shall have the meaning assigned to such term in the First Lien
Credit Agreement on the date hereof.
“Agreement” shall have the meaning assigned to such term in the preamble to this
Agreement.
“Bankruptcy Code” shall mean Title 11 of the United States Code entitled
“Bankruptcy,” as now and hereinafter in effect, or any successor statute.
“Bankruptcy Law” shall mean the Bankruptcy Code and any other Federal, state or
foreign bankruptcy, insolvency, receivership or similar law.
“Borrower” shall have the meaning assigned to such term in the preamble to this
Agreement.
“Borrowing Base” shall mean, at any time, the US Dollar amount determined to be
the “Borrowing Base” in accordance with the terms of the First Lien Credit
Agreement, including any redetermination or adjustment thereof in accordance
with the terms of the First Lien Credit Agreement.
“Borrowing Base Deficiency” shall mean, as of any date of determination, the US
Dollar amount determined to be the “Borrowing Base Deficiency” in accordance
with the terms of the First Lien Credit Agreement.
“Borrowing Base Deficiency Advances” shall mean, at any time of determination,
and in each case calculated for the period from and including the first date on
which the then-existing Borrowing Base Deficiency was created through and
including such time of determination, the sum of (a)(i) the principal amount of
any loans advanced and (ii) the face amount of any letters of credit (other than
any extension or renewal of outstanding letters of credit in amounts not
exceeding the outstanding face amounts) being issued, as the case may be, under
the First Lien Credit Agreement while a Borrowing Base Deficiency exists and
(b)(i) the principal amount of any loans advanced and (ii) the face amount of
any letters of credit issued under the First Lien Credit Agreement to the extent
advancing such loans or issuing such letters of credit (other than any
extensions or renewal of outstanding letters of credit in amounts not exceeding
the outstanding face amounts) would cause a Borrowing Base Deficiency (it being
understood that, for purposes of this clause (b) only the portion

3

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

of such loans or letters of credit in excess of the Borrowing Base shall be
included in such calculation).
“Business Day” shall mean each day that is not a Saturday, Sunday or other day
on which banking institutions in New York, New York, Houston, Texas, or in the
place of payment are authorized or required by law to close.
“Cash Management Agreement” shall mean means any agreement to provide cash
management services, including treasury, depository, overdraft, credit or debit
card, electronic funds transfer and other cash management arrangements.
“Collateral” shall mean, collectively, the First Lien Collateral and the Second
Lien Collateral.
“Conforming Borrowing Base” shall mean, at any time, the US Dollar amount that
would constitute the borrowing base under a Conforming Borrowing Base Facility
under the First Lien Credit Agreement at such time (it being understood that a
borrowing base amount determined in accordance with Section 2.07 of the First
Lien Credit Agreement as in effect on the date hereof would cause the Borrowing
Base and Conforming Borrowing Base to be equivalent numbers).
“Conforming Borrowing Base Deficiency” shall mean, at any time, the greater of
(a) $0.00 and (b) the amount equal to (i) the First Lien Capped Obligations at
such time minus (ii) the Conforming Borrowing Base at such time.
“Conforming Borrowing Base Facility” shall mean, with respect to a First Lien
Credit Agreement, at any time of determination, that the amount of First Lien
Capped Obligations is subject to a conforming commercial banking borrowing base
for oil and gas secured loan transactions, as determined by the First Lien
Lenders, in accordance with their customary oil and gas lending criteria as they
exist at such time and in accordance with the First Lien Credit Agreement,
including customary mechanisms for periodic redeterminations of, and adjustments
to, such borrowing base.
“Defaulting First Lien Secured Party” shall have the meaning assigned to such
term in Section 3.01(e).
“Defaulting First Lien Secured Party Obligation” shall mean, as of any date of
determination and with respect to any Defaulting First Lien Secured Party, any
First Lien Secured Obligations of such Defaulting First Lien Secured Party as of
such date.
“DIP Financing” shall have the meaning assigned to such term in Section
6.01(a)(ii).
“DIP Financing Liens” shall have the meaning assigned to such term in Section
6.01(a)(ii).

4

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

“DIP Purchase Price” shall have the meaning assigned to such term in Section
6.01(b)(i).
“Discharge of Excess First Lien Obligations” shall mean, subject to Section 7.02
and Section 7.04, (a) the Discharge of First Lien Obligations has occurred, (b)
payment in full in cash of the principal of and interest (including interest
accruing during the pendency of any Insolvency Proceeding, regardless of whether
allowed or allowable in such Insolvency Proceeding), expenses (including all
legal fees) and premium, if any, on all Indebtedness outstanding under the First
Lien Loan Documents constituting Excess First Lien Obligations and (c) payment
in full of all other First Lien Capped Obligations constituting Excess First
Lien Obligations that are due and payable or otherwise accrued and owing at or
prior to the time such principal and interest are paid (other than
indemnification and other contingent obligations not yet due or for which no
claim or demand for payment has been made).
“Discharge of First Lien Obligations” shall mean, subject to Section 7.02 and
Section 7.04:
(a)    payment in full in cash of the principal of and interest (including
interest accruing during the pendency of any Insolvency Proceeding, regardless
of whether allowed or allowable in such Insolvency Proceeding) and expenses
(including all legal fees) on all First Lien Secured Obligations outstanding
under the First Lien Loan Documents and constituting First Lien Obligations;
(b)    payment in full in cash of all other First Lien Obligations that are due
and payable or otherwise accrued and owing at or prior to the time such
principal and interest are paid (other than indemnification and other contingent
obligations not yet due or for which no claim or demand for payment has been
made);
(c)    cancellation of or the entry into arrangements reasonably satisfactory to
the First Lien Administrative Agent and each LC Issuer with respect to all
letters of credit issued and outstanding under the First Lien Credit Agreement
and constituting First Lien Obligations (it being understood that the cash
collateralization of such letters of credit in an amount equal to 105% of the
face amount thereof shall be deemed satisfactory);
(d)    payment of the aggregate Swap Termination Value of all Secured Swap
Agreements and all related fees, expenses and other amounts owed to the holders
of the Secured Swap Obligations in connection therewith (or, with respect to any
particular Secured Swap Agreement, such other arrangements as have been made by
the Borrower and the applicable counterparty which is a party to such Secured
Swap Agreement (and communicated to the First Lien Administrative Agent) as
provided in the First Lien Credit Agreement);
(e)    termination, assignment, novation, or collateralization of all Secured
Cash Management Obligations and other obligations associated therewith on terms
satisfactory to the applicable Secured Cash Management Bank in its sole
discretion and consistent with the respective Cash Management Agreement related
thereto; and

5

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

(f)    termination or expiration of all commitments to lend and all obligations
to issue or extend letters of credit under the First Lien Credit Agreement.
“Discharge of First Lien Non-Excluded Obligations” has the same meaning as
“Discharge of First Lien Obligations” except that all references to “First Lien
Obligations” in the definition of “Discharge of First Lien Obligations” shall be
deemed for purposes of this definition to be references to “First Lien
Obligations (other than Defaulting First Lien Secured Party Obligations)”.
“Discharge of Second Lien Obligations” shall mean, subject to Section 7.02 and
Section 7.04, (a) payment in full in cash of the principal of and interest
(including interest accruing during the pendency of any Insolvency Proceeding,
regardless of whether allowed or allowable in such Insolvency Proceeding),
expenses (including all legal fees) and premium, if any, on all Second Lien
Secured Obligations outstanding under the Second Lien Note Documents and
constituting Second Lien Obligations and (b) payment in full in cash of all
other Second Lien Obligations that are due and payable or otherwise accrued and
owing at or prior to the time such principal and interest are paid (other than
indemnification and other contingent obligations not yet due or for which no
claim or demand for payment has been made).
“Disposition” shall mean any sale, lease, exchange, transfer or other
disposition. “Dispose” shall have a correlative meaning.
“Dollars” and the sign “$” shall mean the lawful money of the United States of
America.
“Enforcement Action” shall mean any action to:
(a)    foreclose, execute, levy, or collect on, take possession or control of,
sell or otherwise realize upon (judicially or non-judicially), or lease,
license, or otherwise dispose of (whether publicly or privately), Collateral, or
otherwise exercise or enforce remedial rights with respect to Collateral under
the First Lien Loan Documents or the Second Lien Note Documents (including by
way of setoff, recoupment, notification of a public or private sale or other
disposition pursuant to the UCC or other applicable law, notification to account
debtors, notification to depositary banks under deposit account control
agreements, or exercise of rights under landlord consents, if applicable);
(b)    solicit bids from third Persons, approve bid procedures for any proposed
disposition of Collateral, to conduct the liquidation or disposition of
Collateral or engage or retain sales brokers, marketing agents, investment
bankers, accountants, appraisers, auctioneers, or other third Persons for the
purposes of marketing, promoting, and selling Collateral, in each case under the
First Lien Loan Documents or the Second Lien Note Documents;
(c)    exercise remedies to cause a transfer of Collateral in satisfaction of
any obligations secured thereby;

6

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

(d)    otherwise enforce a security interest or exercise a remedy, as a secured
creditor or pursuant to the First Lien Loan Documents or the Second Lien Note
Documents (including the commencement of applicable legal proceedings or other
actions with respect to all or any portion of the Collateral to facilitate the
actions described in the preceding clauses and exercising voting rights in
respect of equity interests comprising Collateral); or
(e)    Dispose of Collateral by any Grantor after the occurrence and during the
continuation of an event of default under any Loan Document to satisfy a
requirement to Dispose of Collateral imposed upon the Grantor by any First Lien
Secured Party or Second Lien Secured Party, as applicable, in connection with
any waiver or forbearance relating to such event of default in either case with
the consent of First Lien Administrative Agent or the Second Lien Collateral
Agent, as applicable.
“Excess First Lien Obligations” shall mean any obligations that would constitute
First Lien Obligations if not for clause (c) of the definition of First Lien
Obligations.
“Excluded First Lien Obligations” shall mean, with respect to the First Lien
Secured Obligations, (a) the Excess First Lien Obligations, (b) Defaulting First
Lien Secured Party Obligations of all Defaulting First Lien Secured Parties and
(c) and any indemnification and other contingent obligations not yet due or for
which no claim or demand for payment has been made.
“First Lien Administrative Agent” shall have the meaning assigned to such term
in the preamble of this Agreement.
“First Lien Cap Amount” shall mean, at any time, in respect of First Lien
Secured Obligations constituting First Lien Capped Obligations, an amount equal
to the lesser of:
(a)    the sum of (i) the Borrowing Base under the First Lien Credit Agreement
in effect at such time plus (ii) an amount equal to (A) the Borrowing Base
Deficiency under the First Lien Credit Agreement, if any, at such time minus (B)
the Borrowing Base Deficiency Advances, if any, at such time; provided that in
no event shall such difference calculated under this clause (a)(ii) be less than
$0.00; and
(b)    the sum of (i) the Conforming Borrowing Base at such time plus (ii) the
amount equal to (A) the Conforming Borrowing Base Deficiency at such time minus
(B) the Non-Conforming Advances, if any, at such time; provided that in no event
shall such difference calculated under this clause (b)(ii) be less than $0.00.
For the avoidance of doubt, the calculation of the “First Lien Cap Amount”
refers only to the First Lien Capped Obligations and does not include
obligations in respect of Secured Swap Agreements, Cash Management Agreements or
any other liability constituting a part of the First Lien Obligations.
“First Lien Capped Obligations” shall mean the outstanding principal balance of
loans extended pursuant to the First Lien Loan Documents and the face amount of

7

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

outstanding letters of credit under the First Lien Loan Documents (including,
without duplication, unreimbursed letter of credit obligations outstanding under
the First Lien Loan Documents).
“First Lien Collateral” shall mean all Property of any Grantor, whether real,
personal or mixed, now or at any time hereafter subject to Liens securing any
First Lien Secured Obligations.
“First Lien Credit Agreement” shall have the meaning assigned to such term in
the preliminary statement of this Agreement.
“First Lien Lenders” shall have the meaning assigned to such term in the
preliminary statement of this Agreement.
“First Lien Loan Documents” shall mean the “Loan Documents”, as defined in the
First Lien Credit Agreement.
“First Lien Obligations” shall mean, subject to clause (c) hereof, the
following:
(a)    all First Lien Secured Obligations and other obligations outstanding
under, and all other obligations in respect of, the First Lien Credit Agreement,
the other First Lien Loan Documents, each Secured Swap Agreement and each Cash
Management Agreement;
(b)    to the extent any payment with respect to any First Lien Secured
Obligation (whether by or on behalf of any Grantor, as proceeds of security,
enforcement of any right of setoff or otherwise) is declared to be a fraudulent
conveyance or a preference in any respect, set aside or required to be paid to a
debtor in possession, any Second Lien Secured Party, receiver or similar Person,
then the obligation or part thereof originally intended to be satisfied shall,
for the purposes of this Agreement and the rights and obligations of the First
Lien Secured Parties and the Second Lien Secured Parties, be deemed to be
reinstated and outstanding as if such payment had not occurred. To the extent
that any interest, fees, expenses or other charges (including post-petition
interest) to be paid pursuant to the First Lien Loan Documents are disallowed,
disgorged or recharacterized by order of any court, including by order of a
court of competent jurisdiction presiding over an Insolvency Proceeding, such
interest, fees, expenses and charges (including post-petition interest) shall,
as between the First Lien Secured Parties and the Second Lien Secured Parties,
be deemed to continue to accrue and be added to the amount to be calculated as
the “First Lien Obligations”; and
(c)    notwithstanding the foregoing (but solely for purposes of defining the
respective rights and obligations between the First Lien Secured Parties and the
Second Lien Secured Parties under this Agreement), if the sum of the First Lien
Capped Obligations is in excess of the First Lien Cap Amount, then only that
portion of the First Lien Capped Obligations equal to the First Lien Cap Amount
shall be included in First Lien Obligations, and interest, fees, reimbursement
obligations and other amounts with respect to such First

8

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

Lien Capped Obligations shall constitute and be entitled to the benefits
accorded to First Lien Obligations only to the extent related to First Lien
Capped Obligations so included in the First Lien Obligations. First Lien Capped
Obligations in excess of the First Lien Cap Amount and all interest, fees and
other obligations related to such excess shall constitute Excess First Lien
Obligations under this Agreement. Nothing in this clause (c) shall apply to,
impair or have any effect whatsoever on, the obligations of the Borrower or any
other Grantor owing to (x) the First Lien Secured Parties under the First Lien
Loan Documents or (y) to the Second Lien Secured Parties under the Second Lien
Note Documents.
“First Lien Refinancing Notice” shall have the meaning assigned to such term in
Section 7.02(a).
“First Lien Required Lenders” shall mean the “Required Lenders”, as defined in
the First Lien Credit Agreement.
“First Lien Secured Obligations” shall mean the “Secured Obligations” as defined
in the First Lien Credit Agreement.
“First Lien Secured Parties” shall mean, at any time, the “Secured Parties” as
defined in the First Lien Credit Agreement and, if applicable, the Additional
First Lien Loan Documents.
“First Lien Security Documents” shall mean the “Security Instruments”, as
defined in the First Lien Credit Agreement.
“First Priority Liens” shall mean all Liens on the First Lien Collateral
securing the First Lien Obligations, including any judgment lien.
“Grantors” shall mean (a) the Borrower, (b) each other Person that shall have
created or purported to create any Lien on all or any part of its Property to
secure any First Lien Secured Obligations or Second Lien Secured Obligations,
(c) each other Person that shall have provided a guaranty or other similar
credit support for either the First Lien Secured Obligations or the Second Lien
Secured Obligations and (d) each other Person that executes and delivers an
assumption agreement pursuant to Section 7.05.
“Guarantors” shall mean, collectively, each Person that has guaranteed, or that
from time to time hereafter guarantees, the First Lien Secured Obligations or
the Second Lien Secured Obligations.
“Insolvency Proceeding” shall mean:
(a)    any voluntary or involuntary proceeding under the Bankruptcy Code or any
other Bankruptcy Law with respect to any Grantor;
(b)    any voluntary or involuntary appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for any Grantor or for
a substantial part of the Property of any Grantor;

9

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

(c)    any voluntary or involuntary winding-up or liquidation of any Grantor; or
(d)    a general assignment for the benefit of creditors by any Grantor.
“Lien” shall mean any interest in Property securing an obligation owed to, or
securing a claim by, a Person other than the owner of the Property, whether such
interest is based on the common law, statute or contract, and whether such
obligation or claim is fixed or contingent, and including but not limited to
(a) the lien or security interest arising from a mortgage, encumbrance, pledge,
charge, security agreement, conditional sale or trust receipt or a lease,
consignment or bailment for security purposes or (b) production payments and the
like payable out of Oil and Gas Properties. The term “Lien” shall include
easements, restrictions, servitudes, permits, conditions, covenants, exceptions
or reservations granted to secure or evidence any such obligation or claim. For
the purposes of this Agreement, a Grantor shall be deemed to be the owner of any
Property which it has acquired or holds subject to a conditional sale agreement,
or leases under a financing lease or other arrangement pursuant to which title
to the Property has been retained by or vested in some other Person in a
transaction intended to create a financing.
“Loan Documents” shall mean, collectively, the First Lien Loan Documents and the
Second Lien Note Documents.
“Non-Conforming Advances” shall mean, at any time of determination, and in each
case calculated for the period from and including the first date on which the
then-existing Conforming Borrowing Base Deficiency was created through and
including such time of determination, the sum of (a)(i) the principal amount of
any loans advanced and (ii) the face amount of any letters of credit (other than
any extensions or renewals of outstanding letters of credit in amounts not
exceeding the outstanding face amounts) being issued, as the case may be, under
the First Lien Credit Agreement while a Conforming Borrowing Base Deficiency
exists and (b)(i) the principal amount of any loans advanced and (ii) the face
amount of any letters of credit issued under the First Lien Credit Agreement to
the extent advancing such loans or issuing such letters of credit (other than
any extensions or renewals of outstanding letters of credit in amounts not
exceeding the outstanding face amounts) would cause a Conforming Borrowing Base
Deficiency (it being understood that, for purposes of this clause (b) only the
portion of such loans or letters of credit in excess of the Conforming Borrowing
Base shall be included in such calculation).
“Oil and Gas Properties” shall have the meaning assigned to such term in the
First Lien Credit Agreement on the date hereof.
“Other Pledged or Controlled Collateral” shall have the meaning assigned to such
term in Section 5.02.
“Person” shall mean any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership, Governmental Authority
or other entity.

10

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

“Pledged or Controlled Collateral” shall have the meaning assigned to such term
in Section 5.01.
“Property” shall mean any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible, including cash, securities,
accounts and contract rights.
“Refinance” shall mean, in respect of any Secured Obligations, to refinance,
extend, renew, defease, amend, modify, supplement, restructure, replace, refund
or repay, or to issue other Debt in exchange or replacement for, such Secured
Obligations in whole or in part, regardless of whether the principal amount of
such Refinancing Indebtedness is the same, greater than or less than the
principal amount of the Refinanced Indebtedness. “Refinanced” and “Refinancing”
shall have correlative meanings.
“Refinancing Indebtedness” shall mean indebtedness that Refinances First Lien
Secured Obligations or Second Lien Secured Obligations pursuant to Article VII.
“Release” shall have the meaning assigned to such term in Section 3.04.
“Second Lien Collateral” shall mean all Property of any Grantor, whether real,
personal or mixed, now or at any time hereafter subject to Liens securing any
Second Lien Secured Obligations.
“Second Lien Collateral Agent” shall have the meaning assigned to such term in
the preamble to this Agreement.
“Second Lien Collateral Documents” shall mean, collectively, the “Collateral
Documents” as defined in the Second Lien Note Purchase Agreement.
“Second Lien Note Documents” shall mean, collectively, the “Note Documents”, as
defined in the Second Lien Note Purchase Agreement.
“Second Lien Note Purchase Agreement” shall have the meaning assigned to such
term in the preliminary statement to this Agreement.
“Second Lien Obligations” shall mean the following:
(a)    all Second Lien Secured Obligations and other obligations outstanding
under, and all other obligations in respect of, the Second Lien Note Documents;
and
(b)    to the extent any payment with respect to any Second Lien Secured
Obligation (whether by or on behalf of any Grantor, as proceeds of security,
enforcement of any right of setoff or otherwise) is declared to be a fraudulent
conveyance or a preference in any respect, set aside or required to be paid to a
debtor in possession, any receiver or similar Person, then the obligation or
part thereof originally intended to be satisfied shall, for the purposes of this
Agreement and the rights and obligations of the First Lien Secured

11

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

Parties and the Second Lien Secured Parties, be deemed to be reinstated and
outstanding as if such payment had not occurred. To the extent that any
interest, fees, expenses or other charges (including post-petition interest) to
be paid pursuant to the Second Lien Note Documents are disallowed by order of
any court, including by order of a court of competent jurisdiction presiding
over an Insolvency Proceeding, such interest, fees, expenses and charges
(including post-petition interest) shall, as between the First Lien Secured
Parties and the Second Lien Secured Parties, be deemed to continue to accrue and
be added to the amount to be calculated as the “Second Lien Obligations”.
“Second Lien Permitted Actions” shall have the meaning assigned to such term in
Section 3.01(a).
“Second Lien Purchasers” shall have the meaning assigned to such term in Section
3.01(d).
“Second Lien Refinancing Notice” shall have the meaning assigned to such term in
Section 7.02(b).
“Second Lien Required Holders” shall mean the “Required Holders” (as defined in
the Second Lien Note Purchase Agreement).
“Second Lien Secured Obligations” shall collectively mean the “Obligations” (as
defined in the Second Lien Note Purchase Agreement).
“Second Lien Secured Parties” shall mean, at any time, the “Agent” and the
“Secured Parties” (each as defined in the Second Lien Note Documents).
“Second Priority Liens” shall mean all Liens on the Second Lien Collateral
securing the Second Lien Obligations, including any judgment lien.
“Secured Cash Management Bank” means any First Lien Lender or any Affiliate of a
First Lien Lender that is a counterparty to a Cash Management Agreement with the
Borrower or any other Subsidiary.
“Secured Cash Management Obligations” shall mean any First Lien Secured
Obligations arising from time to time under any Cash Management Agreement with a
Secured Cash Management Bank .
“Secured Obligations” means the First Lien Secured Obligations and the Second
Lien Secured Obligations.
“Secured Swap Agreement” means each Swap Agreement between the Borrower or any
Guarantor with any Secured Swap Provider.
“Secured Swap Obligations” means any First Lien Secured Obligations arising
under any Secured Swap Agreement.

12

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

“Secured Swap Provider” means any (a) Person that is a party to a Swap Agreement
with the Borrower or any Guarantor that entered into such Swap Agreement before
or while such Person was a First Lien Lender or an Affiliate of a First Lien
Lender, whether or not such Person at any time ceases to be a First Lien Lender
or an Affiliate of a First Lien Lender, as the case may be, or (b) assignee of
any Person described in clause (a) above so long as such assignee is a First
Lien Lender or an Affiliate of a First Lien Lender.
“Security Documents” shall mean the First Lien Security Documents and the Second
Lien Collateral Documents.
“Standstill Period” shall have the meaning assigned to such term in Section
3.02(a).
“Swap Agreement” means any agreement with respect to any swap, forward, future
or derivative transaction or option or similar agreement, whether exchange
traded, “over-the-counter” or otherwise, involving, or settled by reference to,
one or more rates, currencies, commodities, equity or debt instruments or
securities, or economic, financial or pricing indices or measures of economic,
financial or pricing risk or value or any similar transaction or any combination
of these transactions; provided that no phantom stock or similar plan providing
for payments only on account of services provided by current or former
directors, officers, employees or consultants of the Borrower or its
Subsidiaries shall be a Swap Agreement.
“Swap Termination Value” shall mean, in respect of any one or more Swap
Agreements, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Agreements, (a) for any date on or after
the date such Swap Agreements have been closed out and termination value(s)
determined in accordance therewith, such termination value(s) and any unpaid
amounts and (b) for any date prior to the date referenced in clause (a), the
amount(s) determined as the mark-to-market value(s) for such Swap Agreements, as
determined by the counterparties to such Swap Agreements.
“Uniform Commercial Code” or “UCC” shall mean the Uniform Commercial Code (or
any similar or equivalent legislation) as in effect from time to time in any
applicable jurisdiction.
Section 1.03    Terms Generally. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words “include”, “includes” and “including” shall
be deemed to be followed by the phrase “without limitation.” The word “will”
shall be construed to have the same meaning and effect as the word “shall”.
Unless the context requires otherwise:
(a)    any definition of or reference to any agreement, instrument or other
document herein shall be construed as referring to such agreement, instrument or
other document as from time to time amended, restated, supplemented or otherwise
modified (subject to any restriction or consent requirements with respect to,
such amendments, supplements or modifications set forth herein or in any Loan
Documents),

13

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

(b)    any reference herein (i) to any Person shall be construed to include such
Person’s successors and assigns and (ii) to the Borrower or any other Grantor
shall be construed to include the Borrower or such Grantor as debtor and
debtor-in-possession and any receiver or trustee for the Borrower or any other
Grantor, as the case may be, in any Insolvency Proceeding,
(c)    the words “herein”, “hereof” and “hereunder”, and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, and
(d)    all references herein to Articles or Sections shall be construed to refer
to Articles or Sections of this Agreement.
Section 1.04    Intent. The parties agree that the existence of the terms
Conforming Borrowing Base, Conforming Borrowing Base Deficiency and
Non-Conforming Advances or the usage of the terms herein do not indicate that
Second Lien Collateral Agent or Second Lien Secured Parties intend for there to
be, or consent to, the Borrower permitting the First Lien Credit Agreement to
cease to be a Conforming Borrowing Base Facility.
ARTICLE II

LIEN PRIORITIES
Section 2.01    Relative Priorities. Notwithstanding (a) the date, time, method,
manner or order of grant, attachment or perfection of any Second Priority Lien
or any First Priority Lien, (b) any provision of the UCC or any other applicable
law or the provisions of any Security Document or any other Loan Document, (c)
any defect in, or non-perfection, setting aside, or avoidance of a Lien or a
First Lien Loan Document or a Second Lien Note Document, (d) subject to Section
7.01, the modification of a First Lien Loan Document or a Second Lien Note
Document, (e) the exchange of any security interest in any Collateral for a
security interest in other Collateral, (f) the commencement of an Insolvency
Proceeding or (g) any other circumstance whatsoever, including a circumstance
that might be a defense available to, or a discharge of, a Grantor in respect of
a First Lien Secured Obligation or a Second Lien Secured Obligation or holder of
such obligation, the Second Lien Collateral Agent, for itself and on behalf of
the other Second Lien Secured Parties, hereby agrees that, so long as the
Discharge of First Lien Non-Excluded Obligations has not occurred:
(i)    any First Priority Lien now or hereafter held by or for the benefit of
any First Lien Secured Party shall be senior in right, priority, operation,
effect and all other respects to any and all Second Priority Liens,
(ii)    any Second Priority Lien now or hereafter held by or for the benefit of
any Second Lien Secured Party shall be junior and subordinate in right,
priority, operation, effect and all other respects to any and all First Priority
Liens, and

14

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

(iii)    the First Priority Liens shall be and remain senior in right, priority,
operation, effect and all other respects to any Second Priority Liens for all
purposes, whether or not any First Priority Liens are subordinated in any
respect to any other Lien securing any other obligation of the Borrower, any
other Grantor or any other Person;
provided that the First Lien Administrative Agent, on behalf of itself and the
other First Lien Secured Parties, hereby acknowledges and agrees that any Liens
securing the Excess First Lien Obligations and Defaulting First Lien Secured
Party Obligations are hereby junior and subordinate in right, priority,
operation, effect and all other respects to any and all Second Priority Liens on
any Collateral granted to secure the Second Lien Obligations.
Section 2.02    Prohibition on Contesting Liens. Each of (x) the First Lien
Administrative Agent, for itself and on behalf of the other First Lien Secured
Parties and (y) the Second Lien Collateral Agent, for itself and on behalf of
the other Second Lien Secured Parties, agrees that it will not, and hereby
waives any right to, contest or support any other Person in contesting, in any
proceeding (including any Insolvency Proceeding), the priority, perfection,
validity or enforceability of any Second Priority Lien or any First Priority
Lien, as the case may be; provided that nothing in this Agreement shall be
construed to prevent or impair the rights of the First Lien Administrative
Agent, Second Lien Collateral Agent, any other First Lien Secured Party or any
Second Lien Secured Party to enforce this Agreement.
Section 2.03    No New Liens. The parties hereto agree that, so long as the
Discharge of First Lien Obligations has not occurred, the Borrower shall not,
and shall not permit any of its Subsidiaries or equity owners to:
(a)    grant or permit any additional Liens on any Property to secure any Second
Lien Secured Obligation unless it has granted, or concurrently therewith grants,
a senior Lien on such Property to secure the First Lien Secured Obligations, or
(b)    grant or permit any additional Liens on any Property to secure any First
Lien Secured Obligations unless it has granted, or concurrently therewith
grants, a second Lien on such Property to secure the Second Lien Secured
Obligations, with each such Lien to be subject to the provisions of this
Agreement. To the extent that the provisions of this Section 2.03 are not
complied with for any reason, without limiting any other right or remedy
available to the First Lien Administrative Agent or the other First Lien Secured
Parties, the Second Lien Collateral Agent, for itself and on behalf of the other
Second Lien Secured Parties, agrees that any amounts received by or distributed
to any Second Lien Secured Party pursuant to or as a result of any Lien granted
in contravention of this Section 2.03 shall be subject to Section 4.02.
Section 2.04    Similar Liens and Agreements. Except as set forth in Section
2.03, the parties hereto acknowledge and agree that it is their intention that
the First Lien Collateral and the Second Lien Collateral be identical. To the
extent that, notwithstanding this Section 2.04, the First Lien Collateral and
Second Lien Collateral are not identical, the Second Lien

15

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

Collateral Agent, on behalf of itself and the other Second Lien Secured Parties,
agrees that any amounts received by or distributed to any Second Lien Secured
Party pursuant to or as a result of Liens on Second Lien Collateral that is not
First Lien Collateral, shall be subject to Section 4.02. In furtherance of the
foregoing, the parties hereto agree:
(a)    to cooperate in good faith in order to determine, upon any reasonable
request by the First Lien Administrative Agent or the Second Lien Collateral
Agent, the specific Property included in the First Lien Collateral and the
Second Lien Collateral, the steps taken to perfect the First Priority Liens and
the Second Priority Liens thereon and the identity of the respective parties
obligated under the First Lien Loan Documents and the Second Lien Note
Documents;
(b)    on the date hereof and on any date when any new First Lien Security
Documents are entered into to add Collateral or add additional Guarantors, the
Second Lien Collateral Documents shall be in all material respects in the same
form as the First Lien Security Documents, other than with respect to the first
priority and second priority nature of the Liens created or evidenced
thereunder, the identity of the Secured Parties that are parties thereto or
secured thereby and other matters contemplated by this Agreement (it being
understood that the foregoing shall not require the Second Lien Secured Parties
to forgo having the Second Lien Secured Obligations secured by any Collateral or
guaranteed by any Guarantor contemplated by the Second Lien Note Documents);
(c)    that at no time shall there be any Guarantor in respect of the Second
Lien Secured Obligations that is not also a Guarantor in respect of the First
Lien Secured Obligations, and vice versa; and
(d)    that the First Lien Administrative Agent (i) shall use, and shall
instruct its legal counsel to use, commercially reasonable efforts to cooperate
with the Second Lien Collateral Agent, the Second Lien Secured Party holding a
plurality of the Second Lien Obligations and its legal counsel in connection
with them conducting customary title diligence on the Oil and Gas Properties of
the Borrower and its Subsidiaries and (ii) shall share, and instruct its legal
counsel to share, on a non-reliance basis and without any representation or
warranty, its one-line summary spreadsheet showing (A) the Oil and Gas
Properties that have been mortgaged, (B) the Oil and Gas Properties for which
the status of title has been confirmed by them and (C) its summary calculations
of the percentage of the total present value of the Grantors’ proved Oil and Gas
Properties that have been mortgaged and for which the status of title has been
confirmed.
Section 2.05    Judgment Creditors. In the event that any Second Lien Secured
Party becomes a judgment lien creditor as a result of its enforcement of its
rights as an unsecured creditor, such judgment Lien shall be subject to the
terms of this Agreement for all purposes (including in relation to the First
Priority Liens and the First Lien Secured Obligations) to the same extent as all
other Liens securing the Second Lien Secured Obligations are subject to the
terms of this Agreement.

16

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

Section 2.06    Perfection of Liens. Except for the arrangements contemplated by
Section 5.01, neither the First Lien Administrative Agent nor the other First
Lien Secured Parties shall be responsible for perfecting and maintaining the
perfection of Liens with respect to the Collateral for the benefit of the Second
Lien Collateral Agent or the other Second Lien Secured Parties. Neither the
Second Lien Collateral Agent nor the other Second Lien Secured Parties shall be
responsible for perfecting and maintaining the perfection of Liens with respect
to the Collateral for the benefit of the First Lien Administrative Agent or the
other First Lien Secured Parties. In the event that the First Lien
Administrative Agent, the other First Lien Secured Parties, Second Lien
Collateral Agent or the other Second Lien Secured Parties identify that a Lien
granted under the Security Documents is not perfected or the perfection of such
Lien is not maintained or risks not being maintained and notifies the First Lien
Administrative Agent, in the case where such issue is identified by Second Lien
Collateral Agent or the other Second Lien Secured Parties, or the Second Lien
Collateral Agent, in the case where such issue is identified by the First Lien
Administrative Agent or the other First Lien Secured Parties, as the case may
be, the First Lien Administrative Agent or Second Lien Collateral Agent shall as
promptly as reasonably practicable perfect such Lien or ensure that the
perfection of such Lien is maintained. The provisions of this Agreement are
intended solely to govern the respective Lien priorities as between the First
Lien Secured Parties on the one hand and the Second Lien Secured Parties on the
other hand and such provisions shall not impose on the First Lien Administrative
Agent, the other First Lien Secured Parties, the Second Lien Collateral Agent,
the other Second Lien Secured Parties or any agent or trustee therefor any
obligations in respect of the disposition of proceeds of any Collateral which
would conflict with prior-perfected claims therein in favor of any other Person
or any order or decree of any court or Governmental Authority or any applicable
law.
Section 2.07    No Payment Subordination. Without prejudice to Section 4.01,
nothing contained in this Agreement is intended to payment subordinate (as
opposed to lien subordinate) any payment claim by a Second Lien Secured Party to
a payment claim by a First Lien Secured Party. All payment claims of the First
Lien Secured Parties and the Second Lien Secured Parties are intended to be pari
passu.
ARTICLE III

ENFORCEMENT OF RIGHTS; MATTERS RELATING TO COLLATERAL
Section 3.01    Exercise of Rights and Remedies.
(a)    So long as the Discharge of First Lien Non-Excluded Obligations has not
occurred, the First Lien Administrative Agent and the other First Lien Secured
Parties shall have the exclusive right to (i) commence and maintain any
Enforcement Action (including rights to set-off or credit bid, except that the
Second Lien Secured Parties shall have the credit bid rights set forth in
Section 3.01(a)(v) on the terms set forth therein) whether or not any Insolvency
Proceeding has been commenced, (ii) subject to Section 3.04, when an Insolvency
Proceeding or Enforcement Action has commenced, make determinations regarding
the release or Disposition of, or restrictions with respect to, the Collateral,
and

17

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

(iii) otherwise enforce the rights and remedies of a secured creditor under the
UCC and Bankruptcy Laws of any applicable jurisdiction, without any consultation
with or the consent of the Second Lien Collateral Agent or any other Second Lien
Secured Party so long as any proceeds received by the First Lien Administrative
Agent in excess of those necessary to achieve a Discharge of First Lien
Non-Excluded Obligations are distributed in accordance with Section 4.01;
provided that, notwithstanding the foregoing,
(i)    in any Insolvency Proceeding, any Second Lien Secured Party may file a
proof of claim or statement of interest with respect to the Second Lien Secured
Obligations;
(ii)    the Second Lien Collateral Agent may take any action to preserve or
protect the validity and enforceability of the Second Priority Liens, provided
that, in each case, no such action (A) results in a Lien on the Collateral that
is not subject to the terms of Section 2.01 or (B) is otherwise inconsistent
with the terms of this Agreement, including the automatic release of Second
Priority Liens provided in Section 3.04;
(iii)    the Second Lien Secured Parties may file any responsive or defensive
pleadings in opposition to any motion, claim, adversary proceeding or other
pleading made by any Person objecting to or otherwise seeking the disallowance
of the claims of the Second Lien Secured Parties, including any claims secured
by the Collateral or otherwise make any agreements or file any motions
pertaining to the Second Lien Secured Obligations, in each case, to the extent
not inconsistent with the terms of this Agreement;
(iv)    the Second Lien Secured Parties may exercise rights and remedies as
unsecured creditors, as provided in Section 3.03;
(v)    the Second Lien Secured Parties may (A) present a cash bid for or
purchase Collateral or purchase Collateral for cash at any Section 363 hearing
or at any private, public or judicial foreclosure sale and (B) credit bid for
Collateral pursuant to Section 363(k) of the Bankruptcy Code (provided that such
credit bid may only be made if it results or will concurrently result in the
repayment in full in cash of all First Lien Obligations (other than Excess First
Lien Obligations and any indemnification and other contingent obligations not
yet due or for which no claim or demand for payment has been made) due to a cash
bid for such Collateral in addition to such credit bid); provided, however, in
no event shall the bid pursuant to this Section 3.01(a)(v) be less than the
amount in cash that would be necessary to purchase the First Lien Obligations
pursuant to Section 3.01(d) hereof;
(vi)    the Second Lien Secured Parties shall be entitled to support or vote
their claims to accept any plan of reorganization so long as such plan (a)
results in the repayment in full in cash of all First Lien Obligations (other
than Excess First Lien Obligations and any indemnification and other contingent
obligations not yet due or for which no claim or demand for payment has been
made) on the effective

18

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

date of such plan of reorganization (in the case of a vote in favor of a plan of
reorganization) or (b) is supported by the First Lien Secured Parties;
(vii)    subject to Section 3.02(a), the Second Lien Collateral Agent and the
other Second Lien Secured Parties may enforce any of their rights and exercise
any of their remedies with respect to the Collateral after the termination of
the Standstill Period;
(viii)    the Second Lien Secured Parties may inspect or appraise the Collateral
(and engage or retain investment bankers or appraisers for the sole purposes of
appraising or valuing the Collateral) to the extent that such inspections and/or
appraisals do not interfere in any material respect with an exercise of remedies
by the First Lien Administrative Agent, or to receive information or reports
concerning the Collateral that are prepared by the Borrower and its
representatives (but, subject to Section 2.04(d), not reports prepared by or on
behalf of any First Lien Secured Party);
(ix)    subject to Section 6.01(a), in any Insolvency Proceeding, the Second
Lien Secured Parties shall be entitled to propose and provide a
debtor-in-possession or post-petition financing for the Borrower and its
Subsidiaries, as applicable, under Section 364 of the Bankruptcy Code or any
comparable provision of any other Bankruptcy Law; and
(x)    subject to Section 6.01(c), in any Insolvency Proceeding, the Second Lien
Administrative Agent and the Second Lien Secured Parties may seek and accept
such adequate protection of their interests in the Collateral as they choose;
(the actions described in clauses (i) through (x) above being referred to herein
as the “Second Lien Permitted Actions”). Except for the Second Lien Permitted
Actions, unless and until the Discharge of First Lien Non-Excluded Obligations
has occurred, the sole right of the Second Lien Collateral Agent and the other
Second Lien Secured Parties with respect to the Collateral shall be to receive
the proceeds of the Collateral, if any, remaining after the Discharge of First
Lien Non-Excluded Obligations has occurred and in accordance with the Second
Lien Note Documents and Section 4.01.
(b)    In exercising rights and remedies with respect to the Collateral, the
First Lien Administrative Agent and the other First Lien Secured Parties may
enforce the provisions of the First Lien Loan Documents and exercise remedies
thereunder, all in such order and in such manner as they may determine in their
sole discretion. Such exercise and enforcement shall include the rights of an
agent appointed by them to Dispose of Collateral upon foreclosure, to incur
expenses in connection with any such Disposition and to exercise all the rights
and remedies of a secured creditor under the Uniform Commercial Code, the
Bankruptcy Code or any other Bankruptcy Law. The First Lien Secured Parties will
endeavor to provide at least five (5) Business Days’ prior written notice to the
Second Lien Collateral Agent of their intention to take any Enforcement Action,
provided that any failure to provide such prior notice shall not constitute a
breach of this Agreement.

19

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

(c)    The Second Lien Collateral Agent, for itself and on behalf of the other
Second Lien Secured Parties, hereby acknowledges and agrees that the rights of
any First Lien Secured Party to enforce any provision of this Agreement or any
First Lien Loan Document will not be prejudiced or impaired by (i) any act or
failure to act of any Grantor, any other First Lien Secured Party or the First
Lien Administrative Agent, or (ii) subject to Section 3.02(a), noncompliance by
any Person other than the First Lien Administrative Agent and such First Lien
Secured Party with any provision of this Agreement, any First Lien Loan Document
or any Second Lien Note Document.
(d)    Notwithstanding anything in this Agreement to the contrary, following the
earliest to occur of (i) the acceleration of the First Lien Secured Obligations
then outstanding under the First Lien Credit Agreement, (ii) a payment default
under the First Lien Loan Documents that has not been cured within thirty (30)
days of the occurrence thereof, (iii) the commencement of an Insolvency
Proceeding with respect to the Borrower or any Guarantor, (iv) the commencement
of any Enforcement Action with respect to the Collateral, (v) [reserved] or (vi)
an event of default under Section 10.01(f) or Section 10.01(g) of the First Lien
Credit Agreement (or any substantially equivalent provisions under the First
Lien Credit Agreement (it being understood that as of the date hereof there are
no such substantially equivalent provisions)) has occurred and remains uncured
for more than sixty (60) days, upon ten (10) days prior notice from the Second
Lien Collateral Agent to the First Lien Administrative Agent and the Borrower
(or such shorter time to which the First Lien Administrative Agent may agree) of
any Second Lien Purchaser’s exercise of its purchase option under this Section
3.01(d), the First Lien Secured Parties shall transfer and assign to the Second
Lien Secured Parties and their Affiliates (or any subset thereof) (the “Second
Lien Purchasers”), without warranty or representation or recourse (except for
the amount of the First Lien Obligations being purchased and the representations
and warranties required to be made by assigning lenders pursuant to the
Assignment and Assumption Agreement (as such term is defined in the First Lien
Credit Agreement on the date hereof)), pursuant to customary transfer and
assignment documentation (or such other documentation approved by the First Lien
Administrative Agent and the Second Lien Purchasers), all (but not less than
all) of the First Lien Obligations (excluding or including, at the option of the
Second Lien Purchasers, any Excluded First Lien Obligations), subject to the
following requirements:
(A) the Second Lien Purchasers shall have paid to the First Lien Administrative
Agent, for the account of the First Lien Secured Parties, in immediately
available funds, an amount equal to 100% of the principal of the First Lien
Obligations (excluding any Excluded First Lien Obligations) plus all accrued and
unpaid interest thereon plus all accrued and unpaid fees and expenses thereon
then owed by the Borrower and Guarantors to the First Lien Secured Parties;
(B) with respect to the aggregate face amount of the letters of credit
outstanding under the First Lien Credit Agreement, the amount paid shall be cash
collateral in an amount in cash equal to 105% of the aggregate face amount of
the letters of credit outstanding under the First Lien Credit Agreement (it
being understood that any such

20

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

cash collateral amounts shall be returned to the Second Lien Purchasers to the
extent any such letters of credit expire or are terminated without being drawn
upon); and
(C) with respect to Secured Swap Agreements that constitute First Lien Secured
Obligations, the amount paid shall be equal to 100% of the aggregate Swap
Termination Value of such Secured Swap Agreements.
(e)    In order to effectuate the foregoing, the First Lien Administrative Agent
shall calculate, upon the written request of any Second Lien Secured Party from
time to time, the amount in cash that would be necessary to purchase the First
Lien Obligations (other than, as applicable, any Excluded First Lien
Obligations), and such calculation shall be conclusive and binding absent
manifest error. Notwithstanding anything herein to the contrary, each party
hereto agrees that any transfer and assignment of First Lien Obligations
(excluding or including, at the option of the Second Lien Purchasers, any
Excluded First Lien Obligations) may be effectuated pursuant to transfer and
assignment documents executed by the First Lien Administrative Agent and Second
Lien Purchasers only and that neither the Borrower nor any other First Lien
Secured Party need be a party thereto (and each First Lien Secured Party hereby
appoints the First Lien Administrative Agent, and any officer or agent of the
First Lien Administrative Agent, with full power of substitution, as the
attorney-in-fact of such First Lien Secured Party for the purpose of carrying
out the provisions of Section 3.01(d) and taking any action and executing any
documents that the First Lien Administrative Agent may deem necessary or
advisable to accomplish the purposes of Section 3.01(d), which appointment is
irrevocable and coupled with an interest). Each First Lien Secured Party will
retain all rights to indemnification provided by the Borrower in the relevant
First Lien Loan Documents for all claims and other amounts relating to periods
prior to the purchase of the First Lien Obligations pursuant to this Section
3.01. Out of an abundance of caution, the Second Lien Collateral Agent, on
behalf of itself and the other Second Lien Secured Parties, hereby acknowledges
and agrees that (A) the obligations of the First Lien Secured Parties to sell
their respective First Lien Obligations under Section 3.01(d) are several and
not joint and several, (B) to the extent any First Lien Secured Party breaches
its obligation to sell its First Lien Obligations under Section 3.01(d) (a
“Defaulting First Lien Secured Party”), nothing in Section 3.01(d) shall be
deemed to require the First Lien Administrative Agent or any other First Lien
Secured Party to purchase such Defaulting First Lien Secured Party’s First Lien
Obligations for resale to the Second Lien Secured Parties and (C) in all cases,
the First Lien Administrative Agent and each First Lien Secured Party complying
with the terms of this Section 3.01(d) shall not be deemed to be in default of
this Agreement or otherwise be deemed liable for any action or inaction of any
Defaulting First Lien Secured Party; provided that nothing in Section 3.01(d)
shall (1) require the Second Lien Secured Parties to purchase less than all of
the First Lien Obligations (other than the Excluded First Lien Obligations) or
(2) prohibit the Second Lien Secured Parties from purchasing less than all of
the First Lien Obligations of a First Lien Secured Party that becomes a
Defaulting First Lien Secured Party. In the event that one or more Second Lien
Secured Parties exercises and consummates the purchase option set forth in
Section 3.01(d) and upon the receipt by the First Lien Administrative Agent of
all amounts payable pursuant to Section 3.01(d), if no Excluded First Lien
Obligations remain outstanding, the Second

21

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

Lien Secured Parties shall have the right but not the obligation to require the
First Lien Administrative Agent to resign in its capacity as First Lien
Administrative Agent under the First Lien Loan Documents promptly according to
customary resignation documentation.
(f)    In furtherance of the foregoing Section 3.01(d), the First Lien
Administrative Agent shall endeavor to provide notice to the Second Lien
Collateral Agent of any of the events set forth in Section 3.01(d)(i),
3.01(d)(ii), 3.01(d)(iv) and 3.01(d)(v) or the exercise of any rights or
remedies under the First Lien Loan Documents; provided that the First Lien
Administrative Agent’s failure to give such notice under this Section 3.01(f)
shall not create any claim or cause of action on the part of any Second Lien
Secured Party against the First Lien Administrative Agent for any reason
whatsoever; and provided, further, that nothing in this Section 3.01 shall
impose any duty on the Second Lien Collateral Agent to monitor payments or
defaults under the First Lien Credit Agreement.
Section 3.02    No Interference. The Second Lien Collateral Agent, for itself
and on behalf of the other Second Lien Secured Parties, agrees that, whether or
not any Insolvency Proceeding has been commenced, the Second Lien Secured
Parties:
(a)    except for Second Lien Permitted Actions, will not, so long as the
Discharge of First Lien Non-Excluded Obligations has not occurred, commence any
Enforcement Action; provided, however, that the Second Lien Collateral Agent
may, subject to the other provisions of this Agreement (including the turnover
provisions of Article IV), enforce or exercise any or all such rights and
remedies, or commence, join with any Person in commencing, or petition for or
vote in favor of any resolution for, any such action or proceeding, after a
period of 180 days has elapsed since the date that is the earlier to occur of
(i) the date on which the Second Lien Collateral Trustee has delivered to the
First Lien Administrative Agent written notice of the existence of an Event of
Default (as defined in the Second Lien Note Purchase Agreement) and (ii) the
date on which the Second Lien Collateral Agent has delivered to the First Lien
Administrative Agent written notice that the Second Lien Secured Obligations
then outstanding under the Second Lien Note Purchase Agreement have been
accelerated (the “Standstill Period”), so long as such event of default has not
been cured or waived and such acceleration, if applicable, has not been
rescinded; provided further, however, that notwithstanding the expiration of the
Standstill Period or anything herein to the contrary, except for Second Lien
Permitted Actions, in no event shall any Second Lien Secured Party commence an
Enforcement Action with respect to any Collateral, or commence, join with any
Person in commencing, or petition for or vote in favor of any resolution for,
any such Enforcement Action, if the First Lien Administrative Agent or any other
First Lien Secured Party shall have commenced prior to the expiration of the
Standstill Period, and shall be diligently pursuing (or shall have sought or
requested relief from or modification of the automatic stay or any other stay in
any Insolvency Proceeding to enable the commencement and pursuit thereof), an
Enforcement Action with respect to any material portion of the Collateral;

22

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

(b)    will not contest, protest or object to any Enforcement Action brought by
the First Lien Administrative Agent or any other First Lien Secured Party,
including any Enforcement Action by any First Lien Secured Party relating to the
Collateral;
(c)    subject to the rights of the Second Lien Secured Parties under clause (a)
above, will not object to the forbearance by the First Lien Administrative Agent
or any other First Lien Secured Party from commencing or pursuing any
Enforcement Action with respect to the Collateral;
(d)    will not, so long as the Discharge of First Lien Non-Excluded Obligations
has not occurred and except for Second Lien Permitted Actions, take or receive
any Collateral, or any proceeds thereof or payment with respect thereto, in
connection with the exercise of any Enforcement Action with respect to any
Collateral or in connection with any insurance policy award under a policy of
insurance relating to any Collateral or any condemnation award (or deed in lieu
of condemnation) relating to any Collateral;
(e)    will not, except for Second Lien Permitted Actions, take any action that
would, or could reasonably be expected to, hinder, in any manner, any exercise
of remedies under the First Lien Loan Documents, including any Disposition of
any Collateral, whether by foreclosure or otherwise;
(f)    will not, except for Second Lien Permitted Actions, object to the manner
in which the First Lien Administrative Agent or any other First Lien Secured
Party may seek to enforce or collect the First Lien Obligations or the First
Priority Liens, regardless of whether any action or failure to act by or on
behalf of the First Lien Administrative Agent or any other First Lien Secured
Party is, or could be, adverse to the interests of the Second Lien Secured
Parties, and will not assert, and hereby waive, to the fullest extent permitted
by law, any right to demand, request, plead or otherwise assert or claim the
benefit of any marshalling or other similar right that may be available under
applicable law with respect to the Collateral or any similar rights a junior
secured creditor may have under applicable law; and
(g)    will not attempt, directly or indirectly, whether by judicial proceeding
or otherwise, to challenge or question the validity or enforceability of any
First Lien Secured Obligation or any First Lien Security Document, including
this Agreement, or the validity or enforceability of the priorities, rights or
obligations established by this Agreement;
provided, however, that, in the case of clauses (a) through (g) above, it is the
intention of the parties hereto that the Liens granted to secure the Second Lien
Obligations of the Second Lien Secured Parties shall attach to any proceeds
remaining from any such Enforcement Action taken by the First Lien
Administrative Agent or any First Lien Secured Party in accordance with this
Agreement after application of such proceeds to effectuate a Discharge of First
Lien Non-Excluded Obligations in accordance with Section 4.01.
Section 3.03    Rights as Unsecured Creditors. Notwithstanding anything herein
to the contrary, the Second Lien Collateral Agent and the other Second Lien
Secured Parties

23

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

may, in accordance with the terms of the Second Lien Note Documents and
applicable law, enforce rights and exercise remedies against the Borrower and
any Guarantor as unsecured creditors; provided that no such action is otherwise
expressly prohibited by the terms of this Agreement. Nothing in this Agreement
shall prohibit the acceleration of the Second Lien Secured Obligations, the
receipt by the Second Lien Collateral Agent or any other Second Lien Secured
Party of the required payments of principal, premium, interest, fees and other
amounts due under the Second Lien Note Documents so long as such receipt is not
the direct or indirect result of the enforcement or exercise by the Second Lien
Collateral Agent or any other Second Lien Secured Party of rights or remedies as
a secured creditor (including any right of setoff) or enforcement in
contravention of this Agreement of any Second Priority Lien. Any judgment Lien
that applies to the Collateral and results from the exercise of remedies
available to an unsecured creditor shall be subordinated to the Liens securing
the First Lien Secured Obligations under this Agreement.
Section 3.04    Automatic Release of Second Priority Liens.
(a)    If, in connection with an Enforcement Action, the First Lien
Administrative Agent, for itself and on behalf of the other First Lien Secured
Parties, (x) releases any of the First Priority Liens, or (y) releases any
Guarantor from its obligations under its guarantee of the First Lien Secured
Obligations (in each case, a “Release”), other than any such Release granted
after the occurrence of the Discharge of First Lien Non-Excluded Obligations,
then the Second Priority Liens on such Collateral, and the obligations of such
Guarantor under its guarantee of the Second Lien Secured Obligations, shall be
automatically, unconditionally and simultaneously released, and the Second Lien
Collateral Agent, for itself and on behalf of the other Second Lien Secured
Parties, shall promptly execute and deliver to the First Lien Administrative
Agent, the relevant Grantor or such Guarantor, at such Grantor’s or Guarantor’s
sole cost and expense, such termination statements, releases and other documents
as the First Lien Administrative Agent or the relevant Grantor or Guarantor may
reasonably request to effectively confirm such Release; provided that, any
proceeds received from such Disposition in connection with an Enforcement Action
with respect to the Collateral shall be applied in accordance with the
priorities set forth in Section 4.01 to reduce the First Lien Obligations and,
if applicable, the Second Lien Obligations as set forth therein.
(b)    Until the Discharge of First Lien Non-Excluded Obligations occurs, the
Second Lien Collateral Agent, for itself and on behalf of the other Second Lien
Secured Parties, hereby appoints the First Lien Administrative Agent, and any
officer or agent of the First Lien Administrative Agent, with full power of
substitution, as the attorney-in-fact of each Second Lien Secured Party for the
purpose of carrying out the provisions of this Section 3.04 and taking any
action and executing any instrument that the First Lien Administrative Agent may
deem necessary or advisable to accomplish the purposes of this Section 3.04
(including any endorsements or other instruments of transfer or release), which
appointment is irrevocable and coupled with an interest.
(c)    Until the Discharge of First Lien Non-Excluded Obligations occurs, to the
extent that the First Lien Administrative Agent or the First Lien Secured
Parties have released

24

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

any Lien on Collateral or any Grantor from its obligation under its guaranty and
any such Liens or guaranty are later reinstated, then the Second Lien Collateral
Agent, for itself and for the Second Lien Secured Parties, shall be granted a
Lien on any such Collateral, subject to the lien subordination provisions of
this Agreement, and an additional guaranty, as the case may be, in each case, at
the time of such reinstatement of the Lien or guaranty in favor of the First
Lien Administrative Agent.
Section 3.05    Notice of Exercise of Second Liens. The Second Lien Collateral
Agent, for itself and on behalf of the other Second Lien Secured Parties, agrees
that upon termination of the Standstill Period or such longer period as provided
in Section 3.02, if any Second Lien Secured Party or other representative of
such Second Lien Secured Party intends to commence any Enforcement Action, then
such Second Lien Secured Party or other representative shall endeavor to first
deliver notice thereof in writing to the First Lien Administrative Agent not
less than five (5) Business Days prior to taking any such Enforcement Action.
Such notices may be given during the Standstill Period, provided that the Second
Lien Collateral Agent’s failure to give such notice under this Section 3.05
shall not create any claim or cause of action on the part of any First Lien
Secured Party against the Second Lien Collateral Agent for any reason
whatsoever.
Section 3.06    Insurance and Condemnation Awards. So long as the Discharge of
First Lien Non-Excluded Obligations has not occurred, the First Lien
Administrative Agent and the other First Lien Secured Parties shall have the
exclusive right, subject to the rights of the Grantors under the First Lien Loan
Documents, to settle and adjust claims in respect of Collateral under policies
of insurance covering Collateral and to approve any award granted in any
condemnation or similar proceeding, or any deed in lieu of condemnation, in
respect of the Collateral. All proceeds of any such policy and any such award,
or any payments with respect to a deed in lieu of condemnation, shall be paid
pursuant to the priorities set forth in Section 4.01. Until the Discharge of
First Lien Non-Excluded Obligations has occurred, if the Second Lien Collateral
Agent or any other Second Lien Secured Party shall, at any time, receive any
proceeds of any such insurance policy or any such award or payment, it shall
transfer and pay over such proceeds to the First Lien Administrative Agent in
accordance with Section 4.02.
ARTICLE IV

PAYMENTS
Section 4.01    Application of Proceeds. Regardless of whether an Insolvency
Proceeding has been commenced, any Collateral or proceeds thereof received in
connection with any Disposition of, or collection on, such Collateral following
an Enforcement Action shall be applied:
(a)    first, to the payment in full in cash or cash collateralization of all
First Lien Obligations (other than any indemnification and other contingent
obligations not yet due or for which no claim or demand for payment has been
made);

25

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

(b)    second, upon the Discharge of First Lien Non-Excluded Obligations, to the
payment in full in cash of the Second Lien Obligations (other than any
indemnification and other contingent obligations not yet due or for which no
claim or demand for payment has been made);
(c)    third, upon the Discharge of Second Lien Obligations, to the payment in
full in cash of any Excess First Lien Obligations;
(d)    fourth, upon the Discharge of Excess First Lien Obligations, to the
Borrower or as otherwise required by applicable law.
Notwithstanding the foregoing, any non-cash Collateral or non-cash proceeds will
be held by the First Lien Administrative Agent as Collateral unless the failure
to apply such amounts would be commercially unreasonable. Upon the Discharge of
First Lien Non-Excluded Obligations, the First Lien Administrative Agent shall
deliver to the Second Lien Collateral Agent any remaining Collateral and any
proceeds thereof then held by it in the same form as received, together with any
necessary endorsements, or as a court of competent jurisdiction may otherwise
direct, to be applied by the Second Lien Collateral Agent in accordance with
Section 4.01 until the Discharge of the Second Lien Obligations.
Section 4.02    Payment Over. So long as the Discharge of First Lien
Non-Excluded Obligations has not occurred, any Collateral, or any proceeds
thereof or payment with respect thereto (together with Property or proceeds
subject to Liens referred to in the final sentence of Section 2.03), received by
the Second Lien Collateral Agent or any other Second Lien Secured Party in
connection with any Disposition of, or collection on, such Collateral upon the
enforcement or the exercise of any right or remedy (including any right of
setoff) with respect to the Collateral, shall be segregated and held in trust
and forthwith transferred or paid over to the First Lien Administrative Agent
for the benefit of the First Lien Secured Parties in the same form as received,
together with any necessary endorsements, or as a court of competent
jurisdiction may otherwise direct. Until the Discharge of First Lien
Non-Excluded Obligations occurs, the Second Lien Collateral Agent, for itself
and on behalf of the other Second Lien Secured Parties, hereby appoints the
First Lien Administrative Agent, and any officer or agent of the First Lien
Administrative Agent, with full power of substitution, the attorney-in-fact of
each Second Lien Secured Party for the purpose of carrying out the provisions of
this Section 4.02 and taking any action and executing any instrument that the
First Lien Administrative Agent may deem necessary or advisable to accomplish
the purposes of this Section 4.02, which appointment is irrevocable and coupled
with an interest.
Section 4.03    Certain Agreements with Respect to Unenforceable Liens.
Notwithstanding anything to the contrary contained herein, if in any Insolvency
Proceeding a determination is made that any Lien encumbering any Collateral is
not enforceable for any reason, then the Second Lien Collateral Agent, for
itself and on behalf of the other Second Lien Secured Parties, agrees that any
distribution or recovery they may receive with respect to, or allocable to, the
value of the Property intended to constitute such Collateral or any proceeds
thereof shall (for so long as the Discharge of First Lien Non-Excluded

26

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

Obligations has not occurred) be segregated and held in trust and forthwith paid
over to the First Lien Administrative Agent for the benefit of the First Lien
Secured Parties in the same form as received without recourse, representation or
warranty (other than a representation of the Second Lien Collateral Agent that
it has not otherwise sold, assigned, transferred or pledged any right, title or
interest in and to such distribution or recovery) but with any necessary
endorsements or as a court of competent jurisdiction may otherwise direct until
such time as the Discharge of First Lien Non-Excluded Obligations has occurred.
Until the Discharge of First Lien Non-Excluded Obligations occurs, the Second
Lien Collateral Agent, for itself and on behalf of the other Second Lien Secured
Parties, hereby appoints the First Lien Administrative Agent, and any officer or
agent of the First Lien Administrative Agent, with full power of substitution,
the attorney-in-fact of each Second Lien Secured Party for the limited purpose
of carrying out the provisions of this Section 4.03 and taking any action and
executing any instrument that the First Lien Administrative Agent may deem
necessary or advisable to accomplish the purposes of this Section 4.03, which
appointment is irrevocable and coupled with an interest.
ARTICLE V

BAILMENT
Section 5.01    Bailment for Perfection of Certain Security Interests.
(a)    The First Lien Administrative Agent agrees that if it shall at any time
hold a First Priority Lien on any Collateral that can be perfected by the
possession or control of such Collateral or of any account in which such
Collateral is held, and if such Collateral or any such account is in fact in the
possession or under the control of the First Lien Administrative Agent, or of
agents or bailees of the First Lien Administrative Agent (such Collateral being
referred to herein as the “Pledged or Controlled Collateral”), the First Lien
Administrative Agent shall, solely for the purpose of perfecting the Second
Priority Liens granted under the Second Lien Note Documents and subject to the
terms and conditions of this Article V, also hold such Pledged or Controlled
Collateral as bailee for the Second Lien Secured Parties. The First Lien
Administrative Agent shall not charge the Second Lien Secured Parties for
holding such Collateral as bailee pursuant hereto.
(b)    So long as the Discharge of First Lien Non-Excluded Obligations has not
occurred, the First Lien Administrative Agent shall be entitled to deal with the
Pledged or Controlled Collateral in accordance with the terms of this Agreement
and the other First Lien Loan Documents as if the Second Priority Liens did not
exist until the expiration of the Standstill Period or such longer period as
provided under Section 3.02. The obligations and responsibilities of the First
Lien Administrative Agent to the Second Lien Collateral Agent and the other
Second Lien Secured Parties under this Article V shall be limited solely to
holding or controlling the Pledged or Controlled Collateral as bailee in
accordance with this Article V. Without limiting the foregoing, the First Lien
Administrative Agent shall have no obligation or responsibility to ensure that
any Pledged or Controlled Collateral is genuine or owned by any of the Grantors.
The First Lien Administrative Agent acting pursuant to this Article V shall not,
by reason of this Agreement, any other Security Document or any

27

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

other document, have a fiduciary relationship in respect of any other First Lien
Secured Party, the Second Lien Collateral Agent or any other Second Lien Secured
Party.
(c)    Upon the Discharge of First Lien Non-Excluded Obligations, the First Lien
Administrative Agent shall transfer the possession and control of the Pledged or
Controlled Collateral, together with any necessary endorsements but without
recourse or warranty (other than a representation of the First Lien
Administrative Agent that it has not otherwise sold, assigned, transferred or
pledged any right, title or interest in and to such Pledged or Controlled
Collateral) and at the Borrower’s sole cost and expense, (i) if obligations
under the Second Lien Note Purchase Agreement are outstanding at such time, to
the Second Lien Collateral Agent and (ii) if no Second Lien Obligations or
Excess First Lien Obligations are outstanding at such time, to the applicable
Grantor or to whomever shall be entitled thereto, in each case so as to allow
such Person to obtain possession and control of such Pledged or Controlled
Collateral. Upon the Discharge of Second Lien Obligations, if the Second Lien
Collateral Agent at such time holds any Pledged or Controlled Collateral, it
shall transfer the possession and control of such Pledged or Controlled
Collateral, together with any necessary endorsements but without recourse or
warranty and at the Borrower’s sole cost and expense, (A) if any Excess First
Lien Obligations are outstanding at such time, to the First Lien Administrative
Agent and (B) if no Excess First Lien Obligations are outstanding at such time,
to the applicable Grantor, in each case so as to allow such Person to obtain
possession and control of such Pledged or Controlled Collateral. In connection
with any transfer under this Section 5.01(c), subject to the provisions of
Section 5.01(d), the First Lien Administrative Agent (and the Second Lien
Collateral Agent, as applicable) agrees to take all actions in its power as
shall be reasonably requested by the Second Lien Collateral Agent (or the First
Lien Administrative Agent, as applicable) to permit the Second Lien Collateral
Agent or First Lien Administrative agent, as applicable, to obtain, for the
benefit of the applicable Second Lien Secured Parties or First Lien Secured
Parties, a first priority security interest in the Pledged or Controlled
Collateral.
(d)    Neither the Second Lien Collateral Agent nor the First Lien
Administrative Agent shall be required to take any such action requested by any
party that it in good faith believes exposes it to personal liability for
expenses or other amounts unless it receives an indemnity satisfactory to it
from the requesting party with respect to such action; provided, that nothing in
this Section 5.01(d) shall require the Second Lien Collateral Agent or First
Lien Administrative Agent to provide an indemnity in their individual capacity.
Section 5.02    Bailment for Perfection of Certain Security Interests – Other
Control Collateral (Second Liens). Each of (x) the Second Lien Collateral Agent,
for itself and on behalf of the other Second Lien Secured Parties and (y) the
First Lien Administrative Agent, on behalf of the First Lien Lenders, agrees
that if it shall at any time hold a Lien on any Collateral that can be perfected
by the possession or control of such Collateral or of any account in which such
Collateral is held, and if such Collateral or any such account is in fact in the
possession or under the control of such Person or of their respective agents or
bailees (such Collateral being referred to herein as the “Other Pledged or
Controlled Collateral”), such Person shall, solely for the purpose of perfecting
the First Priority Liens

28

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

granted under the First Lien Loan Documents and the Second Priority Liens
granted under the Second Lien Note Documents, also hold such Other Pledged or
Controlled Collateral as bailee for the First Lien Administrative Agent and as
bailee for the Second Lien Collateral Agent. No obligations shall be imposed on
any Person by reason of this Section 5.02, and none of the First Lien
Administrative Agent, the Second Lien Collateral Agent, any First Lien Lender or
any other Second Lien Secured Party shall have a fiduciary relationship in
respect of any other party. No party shall be required to take any action
requested by any other party that such party in good faith believes exposes it
to personal liability for expenses or other amounts unless such party receives
an indemnity satisfactory to it from the party requesting action. No Person
shall charge the First Lien Administrative Agent or the Second Lien Collateral
Agent for holding such Collateral as bailee pursuant hereto.
ARTICLE VI

INSOLVENCY PROCEEDINGS
Section 6.01    Finance and Sale Matters.
(a)    Until the Discharge of First Lien Non-Excluded Obligations has occurred,
the Second Lien Collateral Agent, for itself and on behalf of the other Second
Lien Secured Parties, agrees that, in the event of any Insolvency Proceeding,
the Second Lien Secured Parties:
(i)    will not oppose or object to the use of any Collateral constituting cash
collateral under Section 363 of the Bankruptcy Code, or any comparable provision
of any other Bankruptcy Law, unless the First Lien Secured Parties, or a
representative authorized by the First Lien Secured Parties, shall oppose or
object to such use of cash collateral;
(ii)    will not oppose or object to any post-petition financing, whether
provided by the First Lien Secured Parties or any other Person, under Section
364 of the Bankruptcy Code, or any comparable provision of any other Bankruptcy
Law (a “DIP Financing”), or the Liens securing any DIP Financing (“DIP Financing
Liens”), unless the First Lien Secured Parties, or a representative authorized
by the First Lien Secured Parties, shall then oppose or object to such DIP
Financing or such DIP Financing Liens, and, to the extent that such DIP
Financing Liens are senior to, or rank pari passu with, the First Priority
Liens, the Second Lien Collateral Agent, for itself and on behalf of the other
Second Lien Secured Parties, will subordinate the Second Priority Liens to the
First Priority Liens and the DIP Financing Liens on the terms of this Agreement.
(iii)    will agree that any customary “carve-out” or other similar
administrative priority expense or claim consented to in writing by First Lien
Administrative Agent to be paid prior to the Discharge of First Lien
Non-Excluded Obligations be deemed for purposes of Section 6.01(a) (A) to be a
use of cash

29

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

collateral and (B) not to be a principal amount of DIP Financing at the time of
such consent;
(iv)    will not provide DIP Financing to the Borrower or other Grantor secured
by Liens equal or senior in priority to the Liens securing any First Lien
Obligations unless (A) such DIP Financing results in the Discharge of the First
Lien Obligations concurrently with the incurrence of such DIP Financing or (B)
either (1) the First Lien Administrative Agent shall have stated in writing that
it will not make a proposal for DIP Financing, (2) the First Lien Administrative
Agent has stated in writing that it is ceasing its efforts to provide a DIP
Financing for which it has previously made a proposal (on its own behalf or on
behalf of another First Lien Secured Party) or has abandoned such efforts, or,
upon written request, not reconfirmed its intention to provide a DIP Financing
(on its own behalf or on behalf of another First Lien Secured Party) or (3) the
Borrower or any of its Affiliates has delivered a request for DIP Financing to
the First Lien Administrative Agent (which request the Borrower agrees to share
concurrently with the Second Lien Collateral Agent) and ten (10) calendar days
shall have expired without delivery of a bona fide proposal in good faith for
DIP Financing to the Borrower from the First Lien Administrative Agent (on its
own behalf or on behalf of another First Lien Secured Party), and each of the
Borrower and the First Lien Administrative Agent agrees to promptly deliver
copies of any proposal for DIP Financing to the Second Lien Collateral Agent
and, in each case, such DIP Financing (I) does not include any provisions for
“roll up”, repayment or refinancing of the Second Lien Obligations, or any
extension of Liens or administrative claims for the benefit of the Second Lien
Obligations that are not subordinated to the liens for the benefit of the First
Lien Obligations, or other forms of cross-collateralization with respect to the
Second Lien Obligations, (II) shall expressly provide that the Second Lien
Obligations shall continue to be subject to this Agreement, (III) does not
require any asset sales or any structure of a plan of reorganization or
milestones therefor, (IV) does not exceed the greater of (aa) $50,000,000 and
(bb) fifteen percent (15%) of the sum of (x) the Borrowing Base in effect
immediately prior to the commencement of such Insolvency Proceeding and (y) the
amount of any Borrowing Base Deficiency that exists at such time and (V) shall
entitle certain holders of the First Lien Obligations to purchase such DIP
Financing at par at any time pursuant to Section 6.01(b);
(v)    except to the extent permitted by Section 6.01(c), in connection with the
use of cash collateral as described in clause (i) above or a DIP Financing, will
not request adequate protection or any other relief in connection with such use
of cash collateral, DIP Financing or DIP Financing Liens; and
(vi)    will not oppose or object to any Disposition of any Collateral free and
clear of the Second Priority Liens or other claims under Section 363 of the
Bankruptcy Code, or any comparable provision of any other Bankruptcy Law, if the
First Lien Secured Parties, or a representative authorized by the First Lien
Secured Parties, shall consent to such Disposition so long as the interests of
the Second Lien

30

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

Secured Parties in the Collateral (and any post-petition Property subject to
adequate protection liens, if any, in favor of the Second Lien Collateral Agent)
attach to the proceeds thereof, subject to the terms of this Agreement.
(b)    If, prior to the Discharge of the First Lien Non-Excluded Obligations,
any Second Lien Secured Party provides any DIP Financing to the Borrower or any
Guarantor, the Second Lien Secured Parties agree at any time, the First Lien
Administrative Agent will have the right to exercise an option (on behalf of
itself or on behalf of one or more First Lien Lenders that are commercial banks)
to purchase the entire aggregate amount (but not less than the entirety) of
outstanding obligations for such DIP Financing (including unfunded commitments
under any DIP Financing documents) at the DIP Purchase Price without warranty or
representation or recourse except as provided below, on a pro rata basis among
the Second Lien Secured Parties party to such DIP Financing.
(i)    The “DIP Purchase Price” will equal the sum of (A) the full amount of all
DIP Financing obligations then-outstanding and unpaid at par (including
principal, accrued but unpaid interest and fees and any other unpaid amounts,
including breakage costs), (B) the cash collateral to be furnished to the DIP
Financing lenders providing letters of credit under the DIP Financing documents
in such amount (not to exceed 105% thereof) as such DIP Financing lenders
determine is reasonably necessary to secure such DIP Financing lenders in
connection with any such outstanding and undrawn letters of credit and (C) all
accrued and unpaid fees, expenses and other amounts (including attorneys’ fees
and expenses) owed to the DIP Financing lenders under or pursuant to the DIP
Financing documents on the date of purchase.
(ii)    If the First Lien Administrative Agent exercises the purchase option
pursuant to Section 6.01(b) above (whether on its own behalf or on behalf of
First Lien Lenders as set forth in Section 6.01(b) above), it shall be exercised
pursuant to documentation mutually acceptable to each of the First Lien
Administrative Agent and the Second Lien Secured Parties party to such DIP
Financing and the parties shall use commercially reasonable efforts to close
promptly after such exercise. Each DIP Financing party will retain all rights to
indemnification provided in the relevant DIP Financing documents for all claims
and other amounts relating to periods prior to the purchase of the DIP Financing
obligations pursuant to this Section 6.01.
(iii)    The purchase and sale of the DIP Financing obligations under this
Section 6.01(b) will be without recourse and without representation or warranty
of any kind by the DIP Financing lenders, except that the DIP Financing lenders
shall severally and not jointly represent and warrant to the First Lien Secured
Parties that on the date of such purchase, immediately before giving effect to
the purchase:
(A)    the principal of and accrued and unpaid interest on the DIP Financing
obligations, and the fees and expenses thereof owed to the respective DIP
Financing lenders, are as stated in any assignment agreement

31

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

prepared in connection with the purchase and sale of the DIP Financing
obligations; and
(B)    the DIP Financing obligations purported to be owned by such DIP Financing
lender is being sold free and clear of any Liens granted by it.
(c)    The Second Lien Collateral Agent, for itself and on behalf of the other
Second Lien Secured Parties, agrees that no Second Lien Secured Party shall
contest, or support any other Person in contesting, (i) any request by the First
Lien Administrative Agent or any other First Lien Secured Party for adequate
protection or (ii) any objection, based on a claim of a lack of adequate
protection, by the First Lien Administrative Agent or any other First Lien
Secured Party to any motion, relief, action or proceeding. Notwithstanding the
immediately preceding sentence, if, in connection with any DIP Financing or use
of cash collateral, (A)(1) any First Lien Secured Party is granted adequate
protection in the form of a Lien on additional collateral, the Second Lien
Collateral Agent, for itself and on behalf of the other Second Lien Secured
Parties, may seek or request adequate protection in the form of a Lien on such
additional collateral, which Lien will be subordinated to the First Priority
Liens and DIP Financing Liens on the same basis as the other Second Priority
Liens are subordinated to the First Priority Liens under this Agreement or (2)
any Second Lien Secured Party is granted adequate protection in the form of a
Lien on additional collateral, the First Lien Administrative Agent shall, for
itself and on behalf of the other First Lien Secured Parties, be granted
adequate protection in the form of a Lien on such additional collateral that is
senior to such Second Priority Lien as security for the First Lien Obligations,
(B) (1) any First Lien Secured Party is granted adequate protection in the form
of cash interest, the Second Lien Collateral Agent, for itself and on behalf of
the other Second Lien Secured Parties, may seek or request adequate protection
in the form of cash interest (provided that the First Lien Administrative Agent
shall in all cases retain its right to object to any such adequate protection in
the form of cash interest) or (2) any Second Lien Secured Party is granted
adequate protection in the form of cash interest, the First Lien Administrative
Agent shall, for itself and on behalf of the other First Lien Secured Parties,
be granted adequate protection in the form of cash interest and (C) in
connection with any DIP Financing provided by any Second Lien Secured Party in
accordance with this Agreement, the First Lien Collateral Agent, for itself and
on behalf of the other First Lien Secured Parties will agree that any customary
“carve-out” or other similar administrative priority expense or claim consented
to in writing by the Second Lien Administrative Agent be deemed (x) to be a use
of cash collateral and (y) not to be a principal amount of DIP Financing at the
time of such consent.
(d)    Notwithstanding the foregoing, the applicable provisions of
Section 6.01(a)(ii), Section 6.01(a)(v) and Section 6.01(c) shall only be
binding on the Second Lien Secured Parties with respect to any DIP Financing to
the extent that the maximum principal amount of Debt permitted under such DIP
Financing does not exceed the sum of (i) the amount of First Lien Obligations
refinanced with the proceeds thereof and (ii) an amount equal to the greater of
(A) $50,000,000 and (B) fifteen percent (15%) of the sum of (1) the Borrowing

32

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

Base in effect immediately prior to the commencement of such Insolvency
Proceeding plus (2) the amount of any Borrowing Base Deficiency that exists at
such time.
Section 6.02    Relief from the Automatic Stay. The Second Lien Collateral
Agent, for itself and on behalf of the other Second Lien Secured Parties, agrees
that, so long as the Discharge of First Lien Non-Excluded Obligations has not
occurred, no Second Lien Secured Party shall, without the prior written consent
of the First Lien Administrative Agent, seek or request relief from or
modification of the automatic stay or any other stay in any Insolvency
Proceeding in respect of any part of the Collateral, any proceeds thereof or any
Second Priority Lien, unless any First Lien Secured Party is also then seeking
or requesting the corresponding relief from or modification of the automatic
stay or any other stay in any Insolvency Proceeding in respect of any part of
the Collateral, any proceeds thereof or any First Priority Lien.
Section 6.03    Reorganization Securities. If, in any Insolvency Proceeding,
debt obligations of the reorganized debtor secured by Liens upon any Property of
the reorganized debtor are distributed, pursuant to a plan of reorganization or
similar dispositive restructuring plan, on account of both the First Lien
Secured Obligations and the Second Lien Secured Obligations, then, to the extent
the debt obligations distributed on account of the First Lien Secured
Obligations and on account of the Second Lien Secured Obligations are secured by
Liens upon the same Property, the provisions of this Agreement will survive the
distribution of such debt obligations pursuant to such plan and will apply with
like effect to the Liens securing such debt obligations.
Section 6.04    Post-Petition Interest.
(a)    The Second Lien Collateral Agent, for itself and on behalf of the other
Second Lien Secured Parties, agrees that no Second Lien Secured Party shall
oppose or seek to challenge any claim by the First Lien Administrative Agent or
any other First Lien Secured Party for allowance or payment in any Insolvency
Proceeding of First Lien Obligations consisting of post-petition interest, fees
or expenses.
(b)    The First Lien Administrative Agent, for itself and on behalf of the
other First Lien Secured Parties, agrees that no First Lien Secured Party shall
oppose or seek to challenge any claim by the Second Lien Collateral Agent, or
any other Second Lien Secured Party for allowance in any Insolvency Proceeding
of Second Lien Obligations consisting of post-petition interest, fees or
expenses.
Section 6.05    Certain Waivers by the Second Lien Secured Parties. The Second
Lien Collateral Agent, for itself and on behalf of the other Second Lien Secured
Parties, waives any claim any Second Lien Secured Party may hereafter have
against any First Lien Secured Party arising out of (a) the election by any
First Lien Secured Party of the application of Section 1111(b)(2) of the
Bankruptcy Code, or any comparable provision of any other Bankruptcy Law, or (b)
any use of cash collateral or financing arrangement, or any grant of a security
interest in the Collateral in a manner consistent with this Agreement, in any
Insolvency Proceeding.

33

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

Section 6.06    Certain Voting Matters. Each of (x) the First Lien
Administrative Agent, on behalf of itself and the other First Lien Secured
Parties and (y) the Second Lien Collateral Agent on behalf of itself and the
other Second Lien Secured Parties, agrees that, without the written consent of
the other, it will not seek to vote with the other as a single class in
connection with any plan of reorganization in any Insolvency Proceeding. Except
as provided in this Section 6.06 or Section 3.01(a)(vi), nothing in this
Agreement is intended, or shall be construed, to limit the ability of the Second
Lien Collateral Agent, or the other Second Lien Secured Parties to vote on any
plan of reorganization.
Section 6.07    Separate Grants of Security and Separate Classification. Each of
(x) the First Lien Administrative Agent, on behalf of the First Lien Secured
Parties and (y) the Second Lien Collateral Agent, on behalf of itself and the
other Second Lien Secured Parties, acknowledges and agrees that (a) the grants
of Liens pursuant to the First Lien Loan Documents and the Second Lien Note
Documents constitute two separate and distinct grants of Liens and (b) because
of, among other things, their differing rights in the Collateral, the Second
Lien Secured Obligations are fundamentally different from the First Lien Secured
Obligations and must be separately classified in any plan of reorganization
proposed or adopted in an Insolvency Proceeding. To further effectuate the
intent of the parties as provided in the immediately preceding sentence, if it
is held that the claims against the First Lien Secured Parties and Second Lien
Secured Parties in respect of the Collateral constitute only one secured claim
(rather than separate classes of first lien and second lien senior secured
claims), then the Second Lien Collateral Agent, for itself and on behalf of the
other Second Lien Secured Parties, hereby acknowledges and agrees that all
distributions shall be made as if there were separate classes of first lien and
second lien senior secured claims against the Borrower and/or other Grantors in
respect of the Collateral with the effect being that (i) to the extent that the
aggregate value of the Collateral is sufficient (for this purpose ignoring all
claims held by the Second Lien Secured Parties), the First Lien Secured Parties
shall be entitled to receive, in addition to amounts distributed to them in
respect of principal, pre-petition interest and other claims, all amounts owing
in respect of post-petition interest before any distribution is made in respect
of the claims held by the Second Lien Secured Parties and (ii) the Second Lien
Secured Parties shall turn over to the First Lien Secured Parties amounts
otherwise received or receivable by them to the extent necessary to effectuate
the intent of this sentence, even if such turnover has the effect of reducing
the claim or recovery of the Second Lien Secured Parties.
ARTICLE VII

OTHER AGREEMENTS
Section 7.01    Matters Relating to Loan Documents.
(a)    The First Lien Loan Documents may be amended, restated, supplemented or
otherwise modified in accordance with their terms, and the First Lien Secured
Obligations under the First Lien Credit Agreement may be Refinanced (in an
amount not to exceed the First Lien Cap Amount), in each case, without the
consent of any Second Lien Secured Party (provided, that, the holders of the
indebtedness resulting from any such Refinancing shall

34

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

agree in writing to be bound by the terms of this Agreement); provided, however,
that, without the prior written consent of the Second Lien Collateral Agent
(acting on the instructions of the Second Lien Required Holders), no such
amendment, restatement, supplement, modification or Refinancing (or successive
amendments, restatements, supplements, modifications or Refinancings) shall:
(i)    contravene any provision of this Agreement,
(ii)    increase the applicable margin or any other component of yield under the
under the First Lien Loan Documents such that the yield under the First Lien
Credit Agreement (excluding increases resulting from the accrual of interest at
the default rate) exceeds by more than 300 basis points the yield under the
First Lien Credit Agreement on the date hereof at any Borrowing Base utilization
level (for the purpose of making such determination, the LIBO Rate (as defined
in the First Lien Credit Agreement on the date hereof) will be calculated in
accordance with the then existing First Lien Credit Agreement (it being
understood (A) for avoidance of doubt, that fluctuations in the LIBO Rate shall
not be included in such determination of yield and (B) arrangement fees,
structuring fees, commitment fees, underwriting fees or other fees payable to
any lead arranger (or its affiliates) in connection with arranging such
amendment, restatement, supplement, modification or Refinancing shall not be
included in such determination of yield)),
(iii)    permit the Borrowing Base to not be subject to a customary scheduled
redetermination for a conforming commercial banking borrowing base facility at
least once in each eighteen (18) calendar month period, or
(iv)    modify a covenant, event of default or any other provision in the First
Lien Loan Documents in a manner that prohibits or restricts one or more Grantors
from making payments of principal, interest or otherwise in respect of the
Second Lien Secured Obligations in a manner that is more restrictive than as
permitted under the First Lien Loan Documents as in effect on the date hereof.
It is understood that, under the Second Lien Note Purchase Agreement as in
effect on the date hereof, the Borrower is subject to Section 7.1(k) and Section
7.20 of the Second Lien Note Purchase Agreement, and the parties hereto agree
that the provisions of Section 7.1(k) and Section 7.20 of the Second Lien Note
Purchase Agreement do not conflict with this Agreement.
(b)    The Second Lien Note Documents may be amended, restated, supplemented or
otherwise modified in accordance with their terms, and the Second Lien Secured
Obligations under the Second Lien Note Purchase Agreement may be Refinanced,
without the consent of any First Lien Secured Party (provided, that, the holders
of the indebtedness resulting from any such Refinancing shall agree in writing
to be bound by the terms of this Agreement); provided, however, that, until the
Discharge of the First Lien Obligations occurs, without the prior written
consent of the First Lien Administrative Agent (acting on the instructions of
the First Lien Required Lenders), no Second Lien Note Document may

35

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

be amended, restated, supplemented or otherwise modified, or entered into, or
Refinanced to the extent such amendment, restatement, supplement or
modification, or the terms of such new Second Lien Note Document, or such
Refinancing would:
(i)    contravene the provisions of this Agreement,
(ii)    increase the applicable margin or any other component of yield under the
under the Second Lien Note Documents such that the yield under the Second Lien
Note Purchase Agreement (excluding increases resulting from the accrual of
interest at the default rate) exceeds by more than 600 basis points the yield
under the Second Lien Note Purchase Agreement on the date hereof (for the
purpose of making such determination, the LIBOR (as defined in the Second Lien
Note Purchase Agreement on the date hereof) will be calculated in accordance
with the then existing Second Lien Note Purchase Agreement (it being understood
(A) for avoidance of doubt, that fluctuations in the LIBOR shall not be included
in such determination of yield and (B) arrangement fees, structuring fees,
commitment fees, underwriting fees or other fees payable to any lead arranger
(or its affiliates) in connection with arranging such amendment, restatement,
supplement, modification or Refinancing shall not be included in such
determination of yield)),
(iii)    change (to earlier dates) any dates upon which payments of principal
and interest are due under the Second Lien Note Documents, or reduce the
weighted average life to maturity of the Second Lien Obligations,
(iv)    add to the Second Lien Collateral other than as specifically provided by
this Agreement or as required pursuant to the terms of the Second Lien Note
Documents as in effect on the date hereof, or
(v)    modify a covenant, event of default or any other provision of the Second
Lien Note Documents that prohibits or restricts one or more Grantors from making
payments of principal, interest or otherwise in respect of the First Lien
Obligations in a manner that is more restrictive than as permitted under the
Second Lien Note Documents as in effect on the date hereof.
It is understood that, under the First Lien Credit Agreement as in effect on the
date hereof, the Borrower is subject to Section 9.04(c) of the First Lien Credit
Agreement, and the parties hereto agree that the provisions of Section 9.04(c)
of the First Lien Credit Agreement do not conflict with this Agreement.
(c)    Each of the Borrower and the Second Lien Collateral Agent agree that the
Borrower shall cause each of the Second Lien Note Documents (other than the
Guaranty Agreement as defined in the Second Lien Note Purchase Agreement) to
contain the applicable provisions set forth on Annex I hereto, or similar
provisions approved by the First Lien Administrative Agent, which approval shall
not be unreasonably withheld, conditioned or delayed.

36

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

Section 7.02    Effect of Refinancing of Indebtedness.
(a)    First Lien Loan Documents. If the Borrower Refinances the First Lien
Obligations (or any change to the terms thereof to the extent permitted by
Section 7.01 hereof) and provided that (a) such Refinancing is permitted hereby
and, subject to Section 7.01(b), by the terms of the Second Lien Note Purchase
Agreement including Section 7.2(k) of the Second Lien Note Purchase Agreement
and (b) the Borrower gives to the Second Lien Collateral Agent written notice
(the “First Lien Refinancing Notice”) electing the application of the provisions
of this Section 7.02(a) to such Refinancing Indebtedness, then (i) a Discharge
of First Lien Obligations shall automatically be deemed not to have occurred for
all purposes of this Agreement, (ii) such Refinancing Indebtedness and all other
obligations under the loan documents evidencing such indebtedness (the
“Additional First Lien Obligations”) shall automatically be treated as First
Lien Secured Obligations for all purposes of this Agreement, including for
purposes of the Lien priorities and rights in respect of Collateral set forth
herein, (iii) the credit agreement and the other loan documents evidencing such
Refinancing Indebtedness (the “Additional First Lien Loan Documents”) shall
automatically be treated as a First Lien Credit Agreement and as First Lien Loan
Documents and, in the case of Additional First Lien Loan Documents that are
security documents, as the First Lien Security Documents for all purposes of
this Agreement, (iv) the Administrative Agent under the Additional First Lien
Loan Documents (the “Additional First Lien Administrative Agent”) shall be
deemed to be the First Lien Administrative Agent for all purposes of this
Agreement and (v) the lenders under the Additional First Lien Loan Documents
shall be deemed to be the First Lien Lenders for all purposes of this Agreement.
Upon receipt of a First Lien Refinancing Notice, which notice shall include the
identity of the Additional First Lien Administrative Agent, the Second Lien
Collateral Agent shall promptly enter into such documents and agreements
(including amendments or supplements to this Agreement) as the Borrower or such
Additional First Lien Administrative Agent may reasonably request in order to
provide to the Additional First Lien Administrative Agent the rights and powers
contemplated hereby, in each case consistent with the terms of this Agreement.
The Borrower shall cause the agreement, document or instrument pursuant to which
the Additional First Lien Administrative Agent is appointed to provide that the
Additional First Lien Administrative Agent agrees to be bound by the terms of
this Agreement. In furtherance of Section 2.03, if the Additional First Lien
Obligations are secured by Property of the Grantors that do not also secure the
Second Lien Obligations, the applicable Grantors shall substantially
contemporaneously grant a Second Priority Lien on such Property to secure the
Second Lien Obligations.
(b)    Second Lien Note Documents. If the Borrower Refinances the Second Lien
Obligations (including an increase thereof, or any change to the terms thereof
to the extent permitted by Section 7.01 hereof) and provided that (a) such
Refinancing is permitted hereby and, subject to Section 7.01(a), by the First
Lien Credit Agreement and (b) the Borrower gives to the First Lien
Administrative Agent written notice (the “Second Lien Refinancing Notice”)
electing the application of the provisions of this Section 7.02(b) to such
Refinancing Indebtedness, then (i) such Refinancing Indebtedness and all other
obligations under the debt documents evidencing such indebtedness (the
“Additional Second Lien Obligations”)

37

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

shall automatically be treated as Second Lien Secured Obligations for all
purposes of this Agreement, including for purposes of the Lien priorities and
rights in respect of Collateral set forth herein, (ii) the Note Purchase
Agreement, credit agreement and the other debt documents evidencing such
Refinancing Indebtedness (the “Additional Second Lien Note Documents”) shall
automatically be treated as a Second Lien Note Purchase Agreement and as Second
Lien Note Documents and, in the case of Additional Second Lien Note Documents
that are security documents, as the Second Lien Collateral Documents for all
purposes of this Agreement, (iii) the Second Lien Collateral Agent under the
Additional Second Lien Note Documents (the “Additional Second Lien Collateral
Agent”) shall be deemed to be a Second Lien Collateral Agent for all purposes of
this Agreement and (iv) the lenders or noteholders under the Additional Second
Lien Note Documents shall be deemed to be the Second Lien Lenders for all
purposes of this Agreement. Upon receipt of a Second Lien Refinancing Notice,
which notice shall include the identity of the Additional Second Lien Collateral
Agent, the First Lien Administrative shall promptly enter into such documents
and agreements (including amendments or supplements to this Agreement) as the
Borrower or such Additional Second Lien Collateral Agent may reasonably request
in order to provide to the Additional Second Lien Collateral Agent the rights
and powers contemplated hereby, in each case consistent with the terms of this
Agreement. The Borrower shall cause the agreement, document or instrument
pursuant to which the Additional Second Lien Collateral Agent is appointed to
provide that the Additional Second Lien Collateral Agent agrees to be bound by
the terms of this Agreement. In furtherance of Section 2.03, if the Additional
Second Lien Obligations are secured by Property of the Grantors that do not also
secure the First Lien Obligations, the applicable Grantors shall substantially
contemporaneously grant a First Priority Lien on such Property to secure the
First Lien Obligations.
Section 7.03    No Waiver by the First Lien Secured Parties. Other than with
respect to the Second Lien Permitted Actions and as may otherwise be expressly
provided herein, nothing contained herein shall prohibit or in any way limit the
First Lien Administrative Agent or any other First Lien Secured Party from
opposing, challenging or objecting to, in any Insolvency Proceeding or
otherwise, any action taken, or any claim made, by the Second Lien Collateral
Agent or any other Second Lien Secured Party, including any request by the
Second Lien Collateral Agent or any other Second Lien Secured Party for adequate
protection or any exercise by the Second Lien Collateral Agent or any other
Second Lien Secured Party of any of its rights and remedies under the Second
Lien Note Documents or otherwise.
Section 7.04    Reinstatement. If, in any Insolvency Proceeding or otherwise,
all or part of any payment with respect to the First Lien Obligations or Second
Lien Secured Obligations, as the case may be, previously made shall be rescinded
for any reason whatsoever, then the First Lien Obligations or Second Lien
Secured Obligations, as the case may be, shall be reinstated to the extent of
the amount so rescinded and, if theretofore terminated, this Agreement shall be
reinstated in full force and effect and such prior termination shall not
diminish, release, discharge, impair or otherwise affect the Lien priorities and
the relative rights and obligations of the First Lien Secured Parties and the
Second Lien Secured Parties provided for herein.

38

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

Section 7.05    Further Assurances. Each of (x) the First Lien Administrative
Agent, for itself and on behalf of the other First Lien Secured Parties, (y) the
Second Lien Collateral Agent, for itself and on behalf of the other Second Lien
Secured Parties and (z) the Borrower, for itself and on behalf of its
Subsidiaries that are Grantors, agrees that it will execute, or will cause to be
executed, any and all further documents, agreements and instruments, and take
all such further actions, as may be required under any applicable law, or which
the First Lien Administrative Agent or the Second Lien Collateral Agent may
reasonably request, to effectuate the terms of this Agreement, including the
relative Lien priorities provided for herein. The parties further agree that,
notwithstanding any failure to take the actions required by the immediately
preceding sentence, each Person that becomes a Grantor at any time (and any
security granted by any such Person) will be subject to the provisions hereof as
fully as if it constituted a Grantor party hereto and had complied with the
requirements of the immediately preceding sentence. Each Grantor party hereto
agrees to cause each of its Subsidiaries formed or acquired after the date
hereof that is a Grantor to become a party for all purposes of this Agreement by
executing and delivering an assumption agreement substantially in the form
attached hereto as Annex II.
Section 7.06    Notice of Exercise of Remedies. Subject to the terms of this
Agreement, each of the First Lien Administrative Agent and the Second Lien
Collateral Agent shall endeavor to provide advance notice to each other of an
acceleration of any First Lien Secured Obligations or Second Lien Secured
Obligations, as the case may be (other than with respect to any automatic
accelerations thereunder); provided, however, neither party's failure to give
such notice under this Section 7.06 shall create any claim or cause of action on
the part of any other party against the party failing to give such notice for
any reason whatsoever. Nothing contained in this Section 7.06 shall limit,
restrict, alleviate, or amend any notice requirement otherwise provided in this
Agreement or otherwise required under applicable law.
ARTICLE VIII

REPRESENTATIONS AND WARRANTIES
Section 8.01    Representations and Warranties of Each Party. Each party hereto
(other than the Grantors) represents and warrants to the other parties hereto as
follows:
(a)    Such party is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization or formation and has all
requisite power and authority to execute and deliver this Agreement and perform
its obligations hereunder.
(b)    This Agreement has been duly executed and delivered by such party and
constitutes a legal, valid and binding obligation of such party, enforceable in
accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors’ rights generally
and subject to general principles of equity, regardless of whether considered in
a proceeding in equity or at law.

39

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

(c)    The execution, delivery and performance by such party of this Agreement
(i) do not require any consent or approval of, registration or filing with or
any other action by any Governmental Authority and (ii) will not violate any
provision of law, statute, rule or regulation, or of the certificate or articles
of incorporation or other constitutive documents or by-laws of such party or any
order of any Governmental Authority or any provision of any indenture, agreement
or other instrument binding upon such party.
Section 8.02    Representations and Warranties of First Lien Administrative
Agent and Second Lien Collateral Agent. The First Lien Administrative Agent
represents and warrants to the other parties hereto that it has been authorized
by the First Lien Lenders to enter into this Agreement. The Second Lien
Collateral Agent represents and warrants to the other parties hereto that it has
been authorized by the Second Lien Secured Parties to enter into this Agreement.
ARTICLE IX

NO RELIANCE; NO LIABILITY; OBLIGATIONS ABSOLUTE
Section 9.01    No Reliance; Information. Each of the First Lien Administrative
Agent and the Second Lien Collateral Agent, for itself and on behalf of the
applicable other Secured Parties, acknowledges that (a) it and such Secured
Parties have, independently and without reliance upon, in the case of the First
Lien Secured Parties, any Second Lien Secured Party and, in the case of the
Second Lien Secured Parties, any First Lien Secured Party, and based on such
documents and information as they have deemed appropriate, made their own credit
analyses and decisions to enter into the Loan Documents to which they are party
and (b) it and such Secured Parties will, independently and without reliance
upon, in the case of the First Lien Secured Parties, any Second Lien Secured
Party and, in the case of the Second Lien Secured Parties, any First Lien
Secured Party, and based on such documents and information as they shall from
time to time deem appropriate, continue to make their own credit decisions in
taking or not taking any action under this Agreement or any other Loan Document
to which they are party, provided, that nothing in this Section 9.01 shall
impose any duty on the Second Lien Collateral Agent to make any credit
decisions. The First Lien Secured Parties and the Second Lien Secured Parties
shall have no duty to disclose to any Second Lien Secured Party or to any First
Lien Secured Party, respectively, any information relating to the Borrower or
any of its Subsidiaries other than as expressly set forth herein, or any other
circumstance bearing upon the risk of nonpayment of any of the First Lien
Secured Obligations or the Second Lien Secured Obligations, as the case may be,
that is known or becomes known to any of them or any of their Affiliates. In the
event any First Lien Secured Party or any Second Lien Secured Party, in its sole
discretion, undertakes at any time or from time to time to provide any such
information in such circumstances to, respectively, any Second Lien Secured
Party or any First Lien Secured Party, it shall be under no obligation (i) to
make, and shall not make or be deemed to have made, any express or implied
representation or warranty, including with respect to the accuracy,
completeness, truthfulness or validity of the information so provided, (ii) to
provide any additional information or to provide any such information on any
subsequent occasion, (iii) to undertake

40

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

any investigation or (iv) to disclose any information, which pursuant to
accepted or reasonable commercial finance practices, such party wishes to
maintain confidential or is otherwise required to maintain confidential.
Section 9.02    No Warranties or Liability.
(a)    The First Lien Administrative Agent, for itself and on behalf of the
other First Lien Secured Parties, acknowledges and agrees that, except for the
representations and warranties set forth in Article VIII, neither the Second
Lien Collateral Agent nor any other Second Lien Secured Party has made any
express or implied representation or warranty, including with respect to the
execution, validity, legality, completeness, collectability or enforceability of
any of the Second Lien Note Documents, the ownership of any Collateral or the
perfection or priority of any Liens thereon. The Second Lien Collateral Agent,
for itself and on behalf of the other Second Lien Secured Parties, acknowledges
and agrees that, except for the representations and warranties set forth in
Article VIII, neither the First Lien Administrative Agent nor any other First
Lien Secured Party has made any express or implied representation or warranty,
including with respect to the execution, validity, legality, completeness,
collectability or enforceability of any of the First Lien Loan Documents, the
ownership of any Collateral or the perfection or priority of any Liens thereon.
(b)    The Second Lien Collateral Agent and the other Second Lien Secured
Parties shall have no express or implied duty to the First Lien Administrative
Agent or any other First Lien Secured Party, and the First Lien Administrative
Agent and the other First Lien Secured Parties shall have no express or implied
duty to the Second Lien Collateral Agent or any other Second Lien Secured Party,
to act or refrain from acting in a manner which allows, or results in, the
occurrence or continuance of a default or an event of default under any First
Lien Loan Document and any Second Lien Note Document (other than, in each case,
this Agreement), regardless of any knowledge thereof which they may have or be
charged with.
(c)    The Second Lien Collateral Agent, for itself and on behalf of the other
Second Lien Secured Parties, agrees that no First Lien Secured Party shall have
any liability to the Second Lien Collateral Agent or any other Second Lien
Secured Party, and hereby waives any claim against any First Lien Secured Party,
arising out of any and all actions which the First Lien Administrative Agent or
the other First Lien Secured Parties may take or permit or omit to take with
respect to (i) the First Lien Loan Documents (other than this Agreement), (ii)
the collection of the First Lien Obligations in accordance with this Agreement
or (iii) the maintenance of, the preservation of, the foreclosure upon or the
Disposition of any Collateral in accordance with this Agreement. The First Lien
Administrative Agent, for itself and on behalf of the other First Lien Secured
Parties, agrees that no Second Lien Secured Party shall have any liability to
the First Lien Administrative Agent or any other First Lien Secured Party, and
hereby waives any claim against any Second Lien Secured Party, arising out of
any and all actions which the Second Lien Collateral Agent or the other Second
Lien Secured Parties may take or permit or omit to take with respect to (i) the
Second Lien Note Documents (other than this Agreement), (ii) the collection of
the Second Lien

41

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

Obligations in accordance with this Agreement or (iii) the maintenance of, the
preservation of, the foreclosure upon or the Disposition of any Collateral in
accordance with this Agreement.
Section 9.03    Obligations Absolute. The Lien priorities provided for herein
and the respective rights, interests, agreements and obligations hereunder of
the First Lien Administrative Agent and the other First Lien Secured Parties and
the Second Lien Collateral Agent and the other Second Lien Secured Parties shall
remain in full force and effect irrespective of:
(a)    any lack of validity or enforceability of any Loan Document;
(b)    subject to the limitations set forth in Section 7.01, any change in the
time, place or manner of payment of, or in any other term of (including the
Refinancing of), all or any portion of the First Lien Secured Obligations or the
Second Lien Secured Obligations, it being specifically acknowledged that a
portion of the First Lien Secured Obligations consists or may consist of
obligations that are revolving in nature, and the amount thereof that may be
outstanding at any time or from time to time may be increased or reduced and
subsequently reborrowed;
(c)    subject to the limitations set forth in Section 7.01, any change in the
time, place or manner of payment of, or, in any other term of, all or any
portion of the First Lien Secured Obligations or the Second Lien Secured
Obligations;
(d)    subject to the limitations set forth in Section 7.01, any amendment,
waiver or other modification, whether by course of conduct or otherwise, of any
Loan Document;
(e)    the securing of any First Lien Secured Obligations or Second Lien Secured
Obligations with any additional collateral or guaranty agreements, or any
exchange, release, voiding, avoidance or non-perfection of any security interest
in any Collateral or any other collateral or any release of any guaranty
securing any First Lien Secured Obligations or Second Lien Secured Obligations,
in each case not in violation of this Agreement; or
(f)    any other circumstances that otherwise might constitute a defense
available to, or a discharge of, the Borrower or any other Loan Party in respect
of the First Lien Secured Obligations, or the Second Lien Secured Obligations or
this Agreement, or any of the Second Lien Secured Parties in respect of this
Agreement.
ARTICLE X

MISCELLANEOUS
Section 10.01    Notices. (a) Notices Generally. Notices and other
communications provided for herein shall be in writing and shall be delivered by
hand or overnight courier service, mailed by certified or registered mail or
sent by facsimile:

42

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

(i)    if to the Borrower or any other Grantor, to it at its address for notices
set forth in the First Lien Credit Agreement and Second Lien Note Purchase
Agreement; and
(ii)    if to the First Lien Administrative Agent, to it at:
JPMorgan Chase Bank, N.A.
712 Main St., 5th Floor
Houston, Texas 77002
Attn: Jo Linda Papadakis
Facsimile No.: 713-216-7770
Email: jo.l.papadakis@jpmorgan.com
With a copy to:

Simpson Thacher & Bartlett LLP
600 Travis Street, Suite 5400
Houston, Texas 77002
Attn: Matthew Einbinder
Facsimile No.: 713-821-5602
Email: MEinbinder@stblaw.com
(iii)    if to the Second Lien Collateral Agent, to it at:
U.S. Bank National Association
Global Corporate Trust Services
225 Asylum Street, 23rd Floor
Hartford, CT 06103
Attn: Laurel Casasanta
Email: laurel.casasanta@usbank.com

With a copy to:
Nicholas Fersen and Bryan Lothrop
Emails: Nicholas.Fersen@eigpartners.com and Bryan.Lothrop@eigpartners.com
With a further copy to:
Michael Chambers
Latham & Watkins LLP
811 Main Street, Suite 3700
Houston, TX 77002
Email: Michael.Chambers@lw.com

43

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

Notices sent by hand or overnight courier service, or mailed by certified or
registered mail, shall be deemed to have been given when received; notices sent
by telecopier shall be deemed to have been given when sent if the sender
receives an acknowledgement of receipt (except that, if not given during normal
business hours for the recipient, shall be deemed to have been given at the
opening of business on the next Business Day for the recipient). Notices
delivered through electronic communications to the extent provided in subsection
(b) below, shall be effective as provided in said subsection (b).
(b)    Electronic Communications. Notices and other communications may be
delivered or furnished by electronic communication (including e-mail) pursuant
to procedures approved by the First Lien Administrative Agent and the Second
Lien Collateral Agent, provided that the foregoing shall not apply to notices to
any party if such party has notified the other parties hereto that it is
incapable of receiving notices by electronic communication.
Unless the First Lien Administrative Agent or the Second Lien Collateral Agent,
as applicable, otherwise prescribes, (i) notices and other communications sent
to an e-mail address shall be deemed received upon the sender’s receipt of an
acknowledgement from the intended recipient (such as by the “return receipt
requested” function, as available, return e-mail or other written
acknowledgement), provided that if such notice or other communication is not
sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on
the next Business Day for the recipient and (ii) notices or communications
posted to an Internet or intranet website shall be deemed received upon the
deemed receipt by the intended recipient at its e-mail address as described in
the foregoing clause (i) of notification that such notice or communication is
available and identifying the website address therefor.
(c)    Change of Address, Etc. Each of the First Lien Administrative Agent and
the Second Lien Collateral Agent may change its address, telecopier or telephone
number for notices and other communications hereunder by notice to the other
parties hereto.
Section 10.02    Integration/Conflicts. This Agreement, the First Lien Loan
Documents and the Second Lien Note Documents represent the entire agreement of
the Grantors, the First Lien Secured Parties and the Second Lien Secured Parties
with respect to the subject matter hereof and thereof, and supersede any and all
previous agreements and understandings, oral or written, relating to the subject
matter hereof and thereof. In the event of any conflict between the provisions
of this Agreement and the provisions of the other Loan Documents, the provisions
of this Agreement shall control.
Section 10.03    Effectiveness; Survival. This Agreement shall become effective
when executed and delivered by the parties hereto. All covenants, agreements,
representations and warranties made by any party in this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement. The terms of this
Agreement shall survive, and shall continue in full force and effect, in any
Insolvency Proceeding. The Second Lien Collateral Agent, for itself and on
behalf of the other Second Lien Secured Parties, hereby waives any and all
rights the Second

44

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

Lien Secured Parties may now or hereafter have under applicable law to revoke
this Agreement or any of the provisions of this Agreement. The First Lien
Administrative Agent, for itself and on behalf of the other First Lien Secured
Parties, hereby waives any and all rights the First Lien Secured Parties may now
or hereafter have under applicable law to revoke this Agreement or any of the
provisions of this Agreement.
Section 10.04    Severability. In the event any one or more of the provisions
contained in this Agreement should be held 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
(it being understood that the invalidity of a particular provision in a
particular jurisdiction shall not in and of itself affect the validity of such
provision in any other jurisdiction). The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to that
of the invalid, illegal or unenforceable provisions.
Section 10.05    Amendments; Waivers.
(a)    No failure or delay on the part of any party hereto in exercising any
power or right hereunder shall operate as a waiver thereof, nor shall any single
or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the parties hereto are cumulative and are not exclusive of any
rights or remedies that they would otherwise have. No waiver of any provision of
this Agreement or consent to any departure by any party therefrom shall in any
event be effective unless the same shall be permitted by paragraph (b) of this
Section 10.05, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given.
(b)    Neither this Agreement nor any provision hereof may be waived, amended or
modified except pursuant to an agreement or agreements in writing entered into
by the First Lien Administrative Agent and the Second Lien Collateral Agent;
provided that no such agreement shall amend, modify or otherwise affect the
rights or obligations of the Borrower or any Grantor (including, without
limitation, Sections 2.03, 3.01(d), 5.01, 5.02, 6.01, 7.01, 7.02 and this
Section 10.05 and the definitions of “Borrowing Base”, “Conforming Borrowing
Base Facility” and “First Lien Capped Amount”) without such Person’s prior
written consent.
Section 10.06    Subrogation. The Second Lien Collateral Agent, for itself and
on behalf of the other Second Lien Secured Parties, hereby waives any rights of
subrogation it or they may acquire as a result of any payment hereunder until
the Discharge of First Lien Non-Excluded Obligations has occurred; provided,
however, that, any such payment that is paid over to the First Lien
Administrative Agent pursuant to this Agreement shall be deemed a payment on the
First Lien Obligations and shall be deemed not to reduce any of the Second Lien
Obligations unless and until the Discharge of First Lien Non-Excluded
Obligations

45

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

shall have occurred and the First Lien Administrative Agent redelivers any such
payment to the Second Lien Collateral Agent.
Section 10.07    Applicable Law; Jurisdiction; Consent to Service of Process.
(a)    THIS AGREEMENT AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION
(WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR
RELATING TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
NEW YORK.
(b)    ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE
BROUGHT EXCLUSIVELY IN THE COURTS OF THE STATE OF NEW YORK, COUNTY OF NEW YORK,
OR OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND,
BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH PARTY HEREBY ACCEPTS FOR
ITSELF AND (TO THE EXTENT PERMITTED BY LAW) IN RESPECT OF ITS PROPERTY,
GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. EACH
PARTY HEREBY IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE
LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY
NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION OR PROCEEDING IN SUCH
RESPECTIVE JURISDICTIONS.
(c)    Each party to this Agreement agrees that service of process in any such
action or proceeding may, to the extent permitted by applicable law, be effected
by delivering a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to any other party, as the
case may be at its address set forth in Section 10.01 or at such other address
of which the other parties shall have been notified pursuant thereto. Nothing in
this Agreement will affect the right of any party to this Agreement to serve
process in any other manner permitted by law.
Section 10.08    Waiver of Jury Trial. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT. EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT, BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 10.08.

46

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

Section 10.09    Parties in Interest. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, as well as the other First Lien Secured Parties and
Second Lien Secured Parties, all of whom are intended to be bound by, and to be
third party beneficiaries of, this Agreement. No other Person shall have or be
entitled to assert rights or benefits hereunder.
Section 10.10    Specific Performance. Each of the First Lien Administrative
Agent and the Second Lien Collateral Agent may demand specific performance of
this Agreement and, on behalf of itself and the respective other Secured
Parties, hereby irrevocably waives any defense based on the adequacy of a remedy
at law and any other defense that might be asserted to bar the remedy of
specific performance in any action which may be brought by the respective
Secured Parties.
Section 10.11    Headings. Article and Section headings used herein and the
Table of Contents hereto are for convenience of reference only, are not part of
this Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.
Section 10.12    Counterparts. This Agreement may be executed in counterparts
(and by different parties hereto on different counterparts), each of which shall
constitute an original but all of which when taken together shall constitute a
single contract, and shall become effective as provided in Section 10.03.
Delivery of an executed signature page to this Agreement by facsimile or other
electronic transmission (e.g., .pdf) shall be as effective as delivery of a
manually signed counterpart of this Agreement.
Section 10.13    Provisions Solely to Define Relative Rights. The provisions of
this Agreement are and are intended solely for the purpose of defining the
relative rights of the First Lien Secured Parties, on the one hand, and the
Second Lien Secured Parties, on the other hand. Except as set forth in Section
10.09, no Person is a third-party beneficiary of this Agreement. Except for the
sections and definitions referred to in Section 10.05 and as otherwise expressly
provided in this Agreement, none of the Borrower, any other Grantor, any
Guarantor or any other creditor thereof shall have any rights or obligations
hereunder and none of the Borrower, any other Grantor or any Guarantor may rely
on the terms hereof. Nothing in this Agreement is intended to or shall impair
the obligations of the Borrower or any other Grantor or any Guarantor, which are
absolute and unconditional, to pay the First Lien Secured Obligations and the
Second Lien Secured Obligations as and when the same shall become due and
payable in accordance with their terms.
Section 10.14    Sharing of Information. The Grantors agree that any information
provided to the First Lien Administrative Agent, the Second Lien Collateral
Agent, any First Lien Secured Party or any Second Lien Secured Party may be
shared by such Person with any First Lien Secured Party, any Second Lien Secured
Party, the First Lien Administrative Agent or the Second Lien Collateral Agent
notwithstanding a request or demand by such Grantor that such information be
kept confidential; provided, that such information shall otherwise be subject to
the respective confidentiality provisions in the First Lien Credit Agreement and
the Second Lien Note Purchase Agreement, as applicable.

47

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

Section 10.15    Agents. It is understood and agreed that (a) the First Lien
Administrative Agent is entering into this Agreement in its capacity as
administrative agent under the First Lien Credit Agreement and the provisions of
Article XI of the First Lien Credit Agreement applicable to the Administrative
Agent (as defined therein) thereunder shall also apply to the First Lien
Administrative Agent hereunder and (b) the Second Lien Collateral Agent is
entering into this Agreement in its capacity as “Agent” under the Second Lien
Note Purchase Agreement and the provisions of Section 9 of the Second Lien Note
Purchase Agreement applicable to the Agent (as defined therein) thereunder shall
also apply to the Second Lien Collateral Agent hereunder.
[Remainder of this page intentionally left blank]

48

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

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.
BORROWER:
SILVERBOW RESOURCES, INC.
(F/K/A SWIFT ENERGY COMPANY),
a Delaware corporation

By:/s/ Christopher M. Abundis     
Name:    Christopher M. Abundis
Title:    Senior Vice President, General
Counsel and Secretary

GRANTORS:
SILVERBOW RESOURCES USA, INC. (F/K/A SWIFT ENERGY USA, INC.),
a Delaware corporation

By:/s/ Christopher M. Abundis     
Name:    Christopher M. Abundis
Title:    Secretary

    

SILVERBOW RESOURCES OPERATING, LLC (F/K/A SWIFT ENERGY OPERATING, LLC),
a Texas limited liability company

By:/s/ Christopher M. Abundis     
Name:    Christopher M. Abundis
Title:    Senior Vice President, General
Counsel and Secretary

[SIGNATURE PAGE TO INTERCREDITOR AGREEMENT]

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

JPMORGAN CHASE BANK, N.A., as First Lien Administrative Agent
By:/s/ Greg Determann    
Name:    Greg Determann
Title:    Authorized Officer

[SIGNATURE PAGE TO INTERCREDITOR AGREEMENT]

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

U.S. BANK NATIONAL ASSOCIATION, as Second Lien Collateral Agent
By:/s/ Laurel A. Melody-Casasanta    
Name:    Laurel A. Melody-Casasanta
Title:    Vice President

ANNEX I
Provision for the Second Lien Note Purchase Agreement
“Reference is made to the Intercreditor Agreement dated as of December 15, 2017
(as amended, restated, supplemented or otherwise modified from time to time, the
“Intercreditor Agreement”), among the Issuer, each of the Grantors (as defined
therein) party thereto, JPMorgan Chase Bank, N.A., as First Lien Administrative
Agent (as defined therein), and U.S. Bank National Association, as Second Lien
Collateral Agent (as defined therein). Each Holder hereunder (a) consents to the
subordination of Liens provided for in the Intercreditor Agreement, and (b)
agrees that it will be bound by and will take no actions contrary to the
provisions of the Intercreditor Agreement as if it was a signatory thereto.”
Provision for Certain Second Lien Collateral Documents
“Reference is made to the Intercreditor Agreement dated as of December 15, 2017
(as amended, restated, supplemented or otherwise modified from time to time, the
“Intercreditor Agreement”), among the Borrower, each of the Grantors (as defined
therein) party thereto, JPMorgan Chase Bank, N.A., as First Lien Administrative
Agent (as defined therein), and U.S. Bank National Association, as Second Lien
Collateral Agent (as defined therein). Notwithstanding anything herein to the
contrary, the lien and security interest granted to the Agent, for the benefit
of the Secured Parties, pursuant to this Agreement and the exercise of any right
or remedy by the Agent and the other Secured Parties hereunder are subject to
the provisions of the Intercreditor Agreement. In the event of any conflict
between the provisions of the Intercreditor Agreement and this Agreement, the
provisions of the Intercreditor Agreement shall control.”

[SIGNATURE PAGE TO INTERCREDITOR AGREEMENT]

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

ANNEX II
[FORM OF] SUPPLEMENT NO. [__] dated as of [_____], 20[__] (the “Supplement”), to
the INTERCREDITOR AGREEMENT dated as of December 15, 2017 (the “Intercreditor
Agreement”), among SilverBow Resources, Inc. (f/k/a Swift Energy Company), a
Delaware corporation (the “Borrower”), the other Grantors party thereto,
JPMORGAN CHASE BANK, N.A., as the First Lien Administrative Agent under the
First Lien Credit Agreement, and U.S. BANK NATIONAL ASSOCIATION, as the Second
Lien Collateral Agent under the Second Lien Note Purchase Agreement.
A.    Capitalized terms used herein and not otherwise defined herein shall have
the meanings assigned to such terms in the Intercreditor Agreement.
B.    The Grantors have entered into the Intercreditor Agreement. Pursuant to
the First Lien Credit Agreement, the Second Lien Note Purchase Agreement,
certain Additional First Lien Loan Documents, and certain Additional Second Lien
Note Documents, certain newly acquired or organized Subsidiaries of the Borrower
are required to enter into the Intercreditor Agreement. Section 7.05 of the
Intercreditor Agreement provides that such Subsidiaries may become party to the
Intercreditor Agreement by execution and delivery of an instrument in the form
of this Supplement. The undersigned Subsidiary (the “New Grantor”) is executing
this Supplement in accordance with the requirements of the First Lien Credit
Agreement, the Second Lien Note Purchase Agreement, the Additional First Lien
Loan Documents, and the Additional Second Lien Note Documents.
Accordingly, the New Grantor agrees and the First Lien Administrative Agent and
the Second Lien Collateral Agent acknowledge as follows:
SECTION 1.    In accordance with Section 7.05 of the Intercreditor Agreement,
the New Grantor by its signature below becomes a Grantor under the Intercreditor
Agreement with the same force and effect as if originally named therein as a
Grantor, and the New Grantor hereby agrees to all the terms and provisions of
the Intercreditor Agreement applicable to it as a Grantor thereunder. Each
reference to a “Grantor” in the Intercreditor Agreement shall be deemed to
include the New Grantor. The Intercreditor Agreement is hereby incorporated
herein by reference.
SECTION 2.    The New Grantor represents and warrants to the Secured Parties
that this Supplement has been duly authorized, executed and delivered by it and
constitutes its legal, valid and binding obligation, enforceable against it in
accordance with its terms, except as such enforceability may be limited by
Bankruptcy Laws and by general principles of equity.
SECTION 3.    This Supplement may be executed in counterparts, each of which
shall constitute an original, but all of which when taken together shall
constitute a single contract. This Supplement shall become effective when the
First Lien Administrative Agent and the Second Lien Collateral Agent shall have
received a counterpart of this Supplement that bears the signature of the New
Grantor. Delivery of an executed signature page to this

Annex II

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

Supplement by facsimile transmission or other electronic method shall be as
effective as delivery of a manually signed counterpart of this Supplement.
SECTION 4.    Except as expressly supplemented hereby, the Intercreditor
Agreement shall remain in full force and effect.
SECTION 5.    THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION 6.    In case any one or more of the provisions contained in this
Supplement should be held invalid, illegal or unenforceable in any respect, no
party hereto shall be required to comply with such provision for so long as such
provision is held to be invalid, illegal or unenforceable, but the validity,
legality and enforceability of the remaining provisions contained herein and in
the Intercreditor Agreement shall not in any way be affected or impaired. The
parties hereto shall endeavor in good-faith negotiations to replace the invalid,
illegal or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the invalid, illegal or
unenforceable provisions.
SECTION 7.    All communications and notices hereunder shall be in writing and
given as provided in Section 10.01 of the Intercreditor Agreement. All
communications and notices hereunder to the New Grantor shall be given to it in
care of the Borrower as specified in the Intercreditor Agreement.
SECTION 8.    The Grantors agree to reimburse the First Lien Administrative
Agent and the Second Lien Collateral Agent for each of their reasonable fees and
expenses in connection with this Supplement, including the reasonable fees,
other charges and disbursements of counsel for each of the First Lien
Administrative Agent and the Second Lien Collateral Agent as required by the
applicable Loan Documents.

Annex II

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

IN WITNESS WHEREOF, the New Grantor has duly executed this Supplement to the
Intercreditor Agreement as of the day and year first above written.
[NAME OF NEW SUBSIDIARY GRANTOR]

By:        
Name:
Title:

Annex II