Exhibit 10.1

Execution Version

ABL CREDIT AGREEMENT

Dated as of October 2, 2018

among

BASIC ENERGY SERVICES, INC.,

as the Borrower,

BANK OF AMERICA, N.A.,

as Administrative Agent, Swing Line Lender

and an L/C Issuer,

UBS SECURITIES LLC,

as Syndication Agent,

PNC BANK NATIONAL ASSOCIATION,

as Documentation Agent and an L/C Issuer,

and

The Other Lenders Party Hereto

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

PNC CAPITAL MARKETS LLC

and

UBS SECURITIES LLC,

as Joint Lead Arrangers and Joint Bookrunners

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TABLE OF CONTENTS

 

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

 

 

1.01        Defined Terms      1   1.02    Other Interpretive Provisions      38
  1.03    Accounting Terms      39   1.04    Rounding      39   1.05    Times of
Day      39   1.06    Letter of Credit Amounts      39   1.07    Currency
Equivalents Generally      40   1.08    Uniform Commercial Code      40   1.09
   LIBOR Amendment      40  

ARTICLE II

 

THE COMMITMENTS AND CREDIT EXTENSIONS

  2.01    The Loans      41   2.02    Borrowings, Conversions and Continuations
of Loans      41   2.03    Letters of Credit      43   2.04    Swing Line Loans
     52   2.05    Prepayments      55   2.06    Termination or Reduction of
Commitments      56   2.07    Repayment of Loans      56   2.08    Interest     
57   2.09    Fees      58   2.10    Computation of Interest and Fees      58  
2.11    Evidence of Debt      58   2.12    Payments Generally; Administrative
Agent’s Clawback      59   2.13    Sharing of Payments by Lenders      61   2.14
   Increase in Commitments      62   2.15    Cash Collateral      63   2.16   
Defaulting Lenders      64   2.17    Protective Advances      65   2.18   
Overadvances      66  

ARTICLE III

 

TAXES, YIELD PROTECTION AND ILLEGALITY

  3.01    Taxes      66   3.02    Illegality      70   3.03    Inability to
Determine Rates      71   3.04    Increased Costs; Capital Adequacy      71  
3.05    Compensation for Losses      73   3.06    Mitigation Obligations;
Replacement of Lenders      73   3.07    Survival      74  

 

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ARTICLE IV

 

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

  4.01        Conditions of Initial Credit Extension      74   4.02   
Conditions to all Credit Extensions      78  

ARTICLE V

 

REPRESENTATIONS AND WARRANTIES

  5.01    Existence, Qualification and Power      78   5.02    Authorization; No
Contravention      79   5.03    Governmental Authorization; Other Consents     
79   5.04    Binding Effect      79   5.05    Financial Statements; No Material
Adverse Effect      80   5.06    Litigation      80   5.07    No Default      80
  5.08    Ownership of Property; Liens; Investments      80   5.09   
Environmental Compliance      80   5.10    Insurance      81   5.11    Taxes   
  82   5.12    ERISA Compliance      82   5.13    Subsidiaries; Equity
Interests; Loan Parties      82   5.14    Margin Regulations; Investment Company
Act      83   5.15    Disclosure      83   5.16    Compliance with Laws      83
  5.17    Intellectual Property; Licenses, Etc      84   5.18    Solvency     
84   5.19    Casualty, Etc.      84   5.20    Labor Matters      84   5.21   
Collateral Documents      84   5.22    Sanctions Concerns      84   5.23    EEA
Financial Institutions      84   5.24    Indenture Compliance      84  

ARTICLE VI

 

AFFIRMATIVE COVENANTS

  6.01    Financial Statements; Borrowing Base Certificate      85   6.02   
Certificates; Other Information      87   6.03    Notices      89   6.04   
Payment of Obligations      89   6.05    Preservation of Existence, Etc.      90
  6.06    Maintenance of Properties      90   6.07    Maintenance of Insurance
     90   6.08    Compliance with Laws      91   6.09    Books and Records     
91   6.10    Inspection Rights      91   6.11    Use of Proceeds      92   6.12
   Covenant to Guarantee Obligations and Give Security      92   6.13   
Compliance with Environmental Laws      94   6.14    Preparation of
Environmental Reports      94   6.15    Further Assurances      95   6.16   
Compliance with Terms of Leaseholds      95   6.17    Material Contracts      95
  6.18    Administration of Deposit Accounts      96   6.19    Designation and
Conversion of Restricted and Unrestricted Subsidiaries; Covenants With Respect
to Unrestricted Subsidiaries      96  

 

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ARTICLE VII

 

NEGATIVE COVENANTS

  7.01        Liens      97   7.02    Indebtedness      99   7.03    Investments
     101   7.04    Fundamental Changes      102   7.05    Dispositions      102
  7.06    Restricted Payments      103   7.07    Change in Nature of Business   
  104   7.08    Transactions with Affiliates      104   7.09    Burdensome
Agreements      104   7.10    Use of Proceeds      105   7.11    Consolidated
Fixed Charge Coverage Ratio      105   7.12    Amendments of Organization
Documents      105   7.13    Accounting Changes      105   7.14    Prepayments,
Etc. of Indebtedness      105   7.15    Amendment, Etc. of Indebtedness      106
  7.16    Sanctions      106  

ARTICLE VIII

 

EVENTS OF DEFAULT AND REMEDIES

  8.01    Events of Default      106   8.02    Remedies upon Event of Default   
  108   8.03    Application of Funds      109  

ARTICLE IX

 

ADMINISTRATIVE AGENT

  9.01    Appointment and Authority      110   9.02    Rights as a Lender     
111   9.03    Exculpatory Provisions      111   9.04    Reliance by
Administrative Agent      112   9.05    Delegation of Duties      113   9.06   
Resignation of Administrative Agent      113   9.07    Non-Reliance on
Administrative Agent and Other Lenders      114   9.08    No Other Duties, Etc.
     114   9.09    Administrative Agent May File Proofs of Claim; Credit Bidding
     115   9.10    Collateral and Guaranty Matters      116   9.11    Secured
Cash Management Agreements and Secured Hedge Agreements      117   9.12   
Certain ERISA Matters      117  

 

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ARTICLE X

 

MISCELLANEOUS

  10.01    Amendments, Etc.      118   10.02    Notices; Effectiveness;
Electronic Communications      120   10.03    No Waiver; Cumulative Remedies;
Enforcement      122   10.04    Expenses; Indemnity; Damage Waiver      123  
10.05    Payments Set Aside      125   10.06    Successors and Assigns      126
  10.07    Treatment of Certain Information; Confidentiality      130   10.08   
Right of Setoff      131   10.09    Interest Rate Limitation      132   10.10   
Counterparts; Integration; Effectiveness      132   10.11    Survival of
Representations and Warranties      132   10.12    Severability      133   10.13
   Replacement of Lenders      133   10.14    Governing Law; Jurisdiction; Etc.
     134   10.15    Waiver of Jury Trial      135   10.16    No Advisory or
Fiduciary Responsibility      135   10.17    Electronic Execution of Assignments
and Certain Other Documents      136   10.18    USA PATRIOT Act      136   10.19
   Keepwell      136   10.20    Credit Inquiries      137   10.21    Performance
of Borrower’s Obligations      137   10.22    Waivers by Borrower      137  
10.23    ENTIRE AGREEMENT      137   10.24    Acknowledgement and Consent to
Bail-In of EEA Financial Institutions      138  

 

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SCHEDULES

 

1.01   Commitments and Applicable Percentages 1.01(a)   Existing Letters of
Credit 5.13   Subsidiaries and Other Equity Investments; Loan Parties 6.12  
Guarantors 6.18   Deposit Accounts 7.01   Existing Liens 7.02   Existing
Indebtedness 7.03   Investments 7.09   Burdensome Agreements 10.02  
Administrative Agent’s Office, Certain Addresses for Notices

EXHIBITS

 

Form of

  

A

   Revolving Credit Loan Notice

B

   Swing Line Loan Notice

C

   Note

D

   Compliance Certificate

E-1

   Assignment and Assumption

E-2

   Administrative Questionnaire

F

   Notice of Loan Prepayment

G

   Secured Party Designation Notice

H

   Letter of Credit Report

I-1 –I-4

   U.S. Tax Compliance Certificates

J

   Borrowing Base Certificate

 

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ABL CREDIT AGREEMENT

This ABL CREDIT AGREEMENT (“Agreement”) is entered into as of October 2, 2018
among Basic Energy Services, Inc., a Delaware corporation (the “Borrower”), each
lender from time to time party hereto (collectively, the “Lenders” and
individually, a “Lender”), and BANK OF AMERICA, N.A., as Administrative Agent, a
Swing Line Lender and an L/C Issuer.

PRELIMINARY STATEMENTS:

The Borrower has requested that the Lenders provide a revolving credit facility
in the initial amount of $150,000,000, and the Lenders have agreed to lend, and
the L/C Issuers have agreed to issue letters of credit, in each case on the
terms and subject to the conditions set forth herein.

In consideration of the mutual covenants and agreements herein contained, the
parties hereto covenant and agree as follows:

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

1.01 Defined Terms. As used in this Agreement, the following terms shall have
the meanings set forth below:

“Acceptable Senior Notes Refinancing” means the payment in full of the Senior
Notes, including the entire outstanding principal amount thereof and interest,
fees, premiums, and other applicable amounts due with respect thereto pursuant
to a refinancing with Indebtedness that satisfies the requirements of
Section 7.02(g)(ii).

“Account” has the same meaning as defined in the UCC, including all rights to
payment for goods sold or leased, or for services rendered.

“Account Debtor” means a Person obligated under an Account, Chattel Paper or
General Intangible.

“Acquisition” means the acquisition, directly or indirectly, by any Person of
(a) at least a majority of the Equity Interests of another Person, (b) all or
substantially all of the assets of another Person or (c) all or substantially
all of a line of business or division of another Person, in each case
(i) whether or not involving a merger or a consolidation with such other Person
and (ii) whether in one transaction or a series of related transactions.

“Acquisition Consideration” means, in connection with any Acquisition, the total
cash and noncash consideration (including the fair market value of all Equity
Interests issued or transferred to the sellers thereof, all indemnities,
earnouts and other contingent payment obligations to, and the aggregate amounts
paid or to be paid under noncompete, consulting and other affiliated agreements
with, the sellers thereof, all write-downs of property and reserves for
liabilities with respect thereto and all assumptions of debt, liabilities and
other obligations in connection therewith) paid by or on behalf of the Borrower
and its Subsidiaries for such Acquisition.

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“Administrative Agent” means Bank of America in its capacity as administrative
agent under any of the Loan Documents, or any successor administrative agent.

“Administrative Agent’s Office” means the Administrative Agent’s address and, as
appropriate, account as set forth on Schedule 10.02, or such other address or
account as the Administrative Agent may from time to time notify to the Borrower
and the Lenders.

“Administrative Questionnaire” means an Administrative Questionnaire in
substantially the form of Exhibit E-2 or any other form approved by the
Administrative Agent.

“Affiliate” means, with respect to any Person, another Person that directly, or
indirectly through one or more intermediaries, Controls or is Controlled by or
is under common Control with the Person specified.

“Aggregate Commitments” means the Commitments of all the Lenders. As of the
Closing Date, the Aggregate Commitments are $150,000,000.

“Agreement” means this ABL Credit Agreement.

“Anti-Terrorism Law” means any law relating to terrorism or money laundering,
including the Patriot Act.

“Applicable Fee Rate” means, at any time, a per annum rate equal to (a) 0.500%
if average daily Revolving Credit Usage was less than 50% of the Aggregate
Commitments during the previous calendar quarter, or (b) 0.375% if average daily
Revolving Credit Usage was equal to or greater than 50% of the Aggregate
Commitments during such quarter.

“Applicable Percentage” means, with respect to any Lender at any time, the
percentage (carried out to the ninth decimal place) of the Aggregate Commitments
represented by such Lender’s Commitment at such time, subject to adjustment as
provided in Section 2.16. If the commitment of each Lender to make Loans and the
obligation of each L/C Issuer to make L/C Credit Extensions have been terminated
pursuant to Section 8.02, or if the Commitments have expired, then the
Applicable Percentage of each Lender in respect of the Aggregate Commitments
shall be determined based on the Applicable Percentage of such Lender in respect
of the Aggregate Commitments most recently in effect, giving effect to any
subsequent assignments. The initial Applicable Percentage of each Lender is set
forth opposite the name of such Lender on Schedule 1.01 or in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable.

 

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“Applicable Rate” means (i) from the Closing Date to April 1, 2019, 1.00% per
annum for Base Rate Loans and 2.00% per annum for LIBOR Loans and Letter of
Credit Fees and (ii) thereafter, the applicable percentage per annum set forth
below for each fiscal quarter (each an “Applicable Quarter”) determined by
reference to the average daily Availability as a percentage of the Borrowing
Base during the fiscal quarter immediately preceding such Applicable Quarter (as
to each Applicable Quarter, the “Reference Quarter”) as determined by the
Administrative Agent based on the Borrowing Base Certificates delivered by the
Borrower to the Administrative Agent:

Applicable Rate

 

Pricing Level

   Average Daily
Availability as a
Percentage of the
Borrowing Base   LIBOR Rate   Base Rate   Letter of Credit
Fees

1

   >66.66%   1.75%   0.75%   1.75%

2

   £ 66.66% but > 33.33%   2.00%   1.00%   2.00%

3

   £ 33.33%   2.25%   1.25%   2.25%

Any increase or decrease in the Applicable Rate for any Applicable Quarter
resulting from a change in the average daily Availability for the applicable
Reference Quarter shall become effective as of the first day of the first
calendar month in the Applicable Quarter. If the Administrative Agent is unable
to calculate average daily Availability for any Reference Quarter due to
Borrower’s failure to deliver any Borrowing Base Certificate when required
pursuant to Section 6.01(e), then, at the option of the Administrative Agent or
the Required Lenders, Pricing Level 3 shall apply during the Applicable Quarter
until the first day of the calendar month following delivery of such Borrowing
Base Certificate.

“Approved Fund” means any Fund that is administered or managed by (a) a Lender,
(b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that
administers or manages a Lender.

“Arrangers” means MLPFS, PNC Capital Markets LLC and UBS Securities LLC, each in
its capacity as joint lead arranger and joint bookrunner.

“Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an Eligible Assignee (with the consent of any party whose consent is
required by Section 10.06(b)), and accepted by the Administrative Agent, in
substantially the form of Exhibit E-1 or any other form (including an electronic
documentation form generated by use of an electronic platform) approved by the
Administrative Agent.

“Attributable Indebtedness” means, on any date, (a) in respect of any
Capitalized Lease of any Person, the capitalized amount thereof that would
appear on a balance sheet of such Person prepared as of such date in accordance
with GAAP, (b) in respect of any Synthetic Lease Obligation, the capitalized
amount of the remaining lease or similar payments under the relevant lease or
other applicable agreement or instrument that would appear on a balance sheet of
such Person prepared as of such date in accordance with GAAP if such lease or
other agreement or instrument were accounted for as a Capitalized Lease and
(c) all Synthetic Debt of such Person.

“Audited Financial Statements” means the audited consolidated balance sheet of
the Borrower and its Subsidiaries for the fiscal year ended December 31, 2017,
and the related consolidated statements of income or operations, shareholders’
equity and cash flows for such fiscal year of the Borrower and its Subsidiaries,
including the notes thereto.

“Availability” means the Borrowing Base minus Total Outstandings.

 

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“Availability Period” means the period from and including the Closing Date to
the earliest of (i) the Maturity Date, (ii) the date of termination of the
Commitments pursuant to Section 2.06, and (iii) the date of termination of the
commitment of each Lender to make Revolving Credit Loans and of the obligation
of each L/C Issuer to make L/C Credit Extensions pursuant to Section 8.02.

“Availability Reserve” means the sum (without duplication) of (a) the Bank
Product Reserve; (b) the Rent and Charges Reserve, (c) the Dilution Reserve;
(d) all accrued Royalties, whether or not then due and payable by any Loan
Party; (e) the aggregate amount of liabilities secured by Liens upon the
Collateral that are senior to Administrative Agent’s Liens (but imposition of
any such reserve shall not waive an Event of Default arising therefrom); and
(f) such additional reserves, in such amounts and with respect to such matters,
as Administrative Agent in its Permitted Discretion may elect to impose from
time to time; provided that unless an Event of Default exists and is continuing
(in which case no notice shall be required and any changes shall take effect
immediately), no change in respect of a new category of additional reserves
shall take effect until the third (3rd) Business Day following delivery by
Administrative Agent of written notification to Borrower of such new category
(during which period Administrative Agent shall be available to discuss any such
proposed new reserve category with Borrower and Borrower may take such action as
may be required to eliminate the event, condition or matter that is the basis
for such new category).

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by
the applicable EEA Resolution Authority in respect of any liability of an EEA
Financial Institution.

“Bail-In Legislation” means, with respect to any EEA Member Country implementing
Article 55 of Directive 2014/59/EU of the European Parliament and of the Council
of the European Union, the implementing law for such EEA Member Country from
time to time which is described in the EU Bail-In Legislation Schedule.

“Bank of America” means Bank of America, N.A. and its successors.

“Bank Product” means any of the following products, services or facilities
extended to the Borrower or a Subsidiary of the Borrower by a Lender or any of
its Affiliates: (a) services under Cash Management Agreements; (b) products
under Swap Contracts; and (c) other banking products or services, other than
Letters of Credit.

“Bank Product Reserve” means the aggregate amount of reserves established by
Administrative Agent from time to time in its Permitted Discretion in respect of
Secured Bank Product Obligations; provided that no Bank Product Reserve will be
established in respect of the P-Card Agreements so long as the Treasury
Management Control Agreement remains in effect.

“Base Rate” means for any day a fluctuating rate per annum equal to the highest
of (a) the Federal Funds Rate plus 1/2 of 1%, (b) the Prime Rate, and (c) LIBOR
for a 30 day interest period as of such day plus 1.00%; provided that in no
event shall the Base Rate be less than zero.

“Base Rate Loan” means a Revolving Credit Loan that bears interest based on the
Base Rate.

 

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“Beneficial Ownership Certification” means a certification regarding beneficial
ownership as required by the Beneficial Ownership Regulation, in form and
substance satisfactory to Administrative Agent.

“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.

“Benefit Plan” means any of (a) an “employee benefit plan” (as defined in ERISA)
that is subject to Title I of ERISA, (b) a “plan” as defined in and subject to
Section 4975 of the Code or (c) any Person whose assets include (for purposes of
ERISA Section 3(42) or otherwise for purposes of Title I of ERISA or
Section 4975 of the Code) the assets of any such “employee benefit plan” or
“plan”.

“BER” means Basic Energy Receivables, LLC, a Delaware limited liability company.

“BER Holdco” means BER Holdco, LLC, a Delaware limited liability company.

“BESI” means Basic Energy Services International, LLC, a Delaware limited
liability company.

“Borrower” has the meaning specified in the introductory paragraph hereto.

“Borrower Materials” has the meaning specified in Section 6.02.

“Borrowing” means a Revolving Credit Borrowing or a Swing Line Borrowing, as the
context may require.

“Borrowing Base” means, on any date of determination, an amount equal to the
lesser of (a) the Aggregate Commitments; or (b) the sum, without duplication, of
the following:

(i) 85% of the Value of Eligible Accounts, plus

(ii) the lesser of (A) 80% of the Value of Eligible Unbilled Accounts or (B)
$30,000,000, minus

(iii) the Availability Reserve.

No Borrowing Base calculation shall include Collateral acquired in a Permitted
Acquisition or otherwise outside the ordinary course of business until
completion of applicable field examinations satisfactory to Administrative Agent
(which shall not be included in the limits provided in Section 6.10(b)).

“Borrowing Base Certificate” means a certificate substantially in the form of
Exhibit J or in such other form as is reasonably satisfactory to the
Administrative Agent, by which Borrower certifies the calculation of the
Borrowing Base.

 

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“Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks are authorized to close under the Laws of, or are in fact
closed in, the state where the Administrative Agent’s Office is located and, if
such day relates to any LIBOR Loan, means any such day that is also a London
Banking Day.

“Capital Expenditures” means, with respect to any Person for any period, any
expenditure in respect of the purchase or other acquisition of any fixed or
capital asset; provided that Capital Expenditures shall not include any such
expenditures relating to Capitalized Leases, purchase money obligations or
Synthetic Lease Obligations, in each case, permitted pursuant to Section 7.02(f)
or any such expenditures incurred in connection with Permitted Acquisitions
permitted pursuant to Section 7.03(g). For purposes of this definition, the
purchase price of equipment that is purchased simultaneously with the trade-in
of existing equipment or with insurance proceeds shall be included in Capital
Expenditures only to the extent of the amount by which such purchase price
exceeds the credit granted by the seller of such equipment for the equipment
being traded in at such time or the amount of such insurance proceeds, as the
case may be.

“Capitalized Leases” means all leases that have been or should be, in accordance
with GAAP, recorded as capitalized leases.

“Cash Collateralize” means to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of the Administrative Agent, L/C Issuers
or the Swing Line Lenders (as applicable) and the Lenders, as collateral for L/C
Obligations, Obligations in respect of Swing Line Loans, or obligations of
Lenders to fund participations in respect of either thereof (as the context may
require), (a) cash or deposit account balances, (b) backstop letters of credit
entered into on terms, from issuers and in amounts satisfactory to the
Administrative Agent and the applicable L/C Issuer, and/or (c) if the L/C
Issuers or Swing Line Lenders benefitting from such collateral shall agree in
its sole discretion, other credit support, in each case pursuant to
documentation in form and substance satisfactory to (x) the Administrative Agent
and (y) the L/C Issuers or the Swing Line Lenders (as applicable). “Cash
Collateral” shall have a meaning correlative to the foregoing and shall include
the proceeds of such cash collateral and other credit support.

“Cash Dominion Trigger Period” means the period (a) commencing on the day that
(i) an Event of Default occurs, or (ii) Availability is less than the greater of
(x) 12.5% of the Borrowing Base or (y) $18,750,000, and (b) continuing until,
during each of the preceding 30 consecutive days, no Event of Default has
existed and Availability has at all times exceeded the greater of (i) 12.5% of
the Borrowing Base or (ii) $18,750,000.

“Cash Equivalents” means any of the following types of Investments, to the
extent owned by the Borrower or any of its Restricted Subsidiaries free and
clear of all Liens (other than Liens created under the Collateral Documents and
other Liens permitted hereunder):

(a) readily marketable obligations issued or directly and fully guaranteed or
insured by the United States of America or any agency or instrumentality thereof
having maturities of not more than 360 days from the date of acquisition
thereof; provided that the full faith and credit of the United States of America
is pledged in support thereof;

 

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(b) time deposits with, or insured certificates of deposit or bankers’
acceptances of, any commercial bank that (i) (A) is a Lender or (B) is organized
under the laws of the United States of America, any state thereof or the
District of Columbia or is the principal banking subsidiary of a bank holding
company organized under the laws of the United States of America, any state
thereof or the District of Columbia, and is a member of the Federal Reserve
System, (ii) issues (or the parent of which issues) commercial paper rated as
described in clause (c) of this definition and (iii) has combined capital and
surplus of at least $1,000,000,000, in each case with maturities of not more
than 180 days from the date of acquisition thereof;

(c) commercial paper issued by any Person organized under the laws of any state
of the United States of America and rated at least “Prime-1” (or the then
equivalent grade) by Moody’s or at least “A-1” (or the then equivalent grade) by
S&P, in each case with maturities of not more than 180 days from the date of
acquisition thereof; and

(d) Investments, classified in accordance with GAAP as current assets of the
Borrower or any of its Restricted Subsidiaries, in money market investment
programs registered under the Investment Company Act of 1940, which are
administered by financial institutions that have the highest rating obtainable
from either Moody’s or S&P, and the portfolios of which are comprised of least
95% of Investments of the character, quality and maturity described in clauses
(a), (b) and (c) of this definition.

“Cash Management Agreement” means any agreement to provide cash management
services, including treasury, depository, overdraft, credit or debit card,
electronic funds transfer and other cash management arrangements.

“Cash Management Bank” means any Person in its capacity as a party to a Cash
Management Agreement that, (a) at the time it enters into a Cash Management
Agreement, is a Lender or an Affiliate of a Lender, or (b) at the time it (or
its Affiliate) becomes a Lender, is a party to a Cash Management Agreement, in
each case, in its capacity as a party to such Cash Management Agreement (even if
such Person ceases to be a Lender or such Person’s Affiliate ceased to be a
Lender); provided, however, that for any of the foregoing to be included as a
“Secured Cash Management Agreement” on any date of determination by the
Administrative Agent, the applicable Cash Management Bank (other than the
Administrative Agent or an Affiliate of the Administrative Agent) must have
delivered a Secured Party Designation Notice to the Administrative Agent prior
to such date of determination.

“CERCLA” means the Comprehensive Environmental Response Compensation and
Liability Act (42 U.S.C. § 9601 et seq.).

“CERCLIS” means the Comprehensive Environmental Response, Compensation and
Liability Information System maintained by the U.S. Environmental Protection
Agency.

“CFC” means a Person that is a controlled foreign corporation under Section 957
of the Code.

“Change in Law” means the occurrence, after the Closing Date, of any of the
following: (a) the adoption or taking effect of any law, rule, regulation or
treaty, (b) any change in any law, rule, regulation or treaty or in the
administration, interpretation, implementation or application thereof by any
Governmental Authority or (c) the making or issuance of any request, guideline
or directive (whether or not having the force of law) by any Governmental
Authority, provided that

 

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notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street
Reform and Consumer Protection Act and all requests, rules, guidelines, or
directives thereunder or issued in connection therewith and (ii) all requests,
rules, guidelines or directives promulgated by the Bank for International
Settlements, the Basel Committee on Banking Supervision (or any successor or
similar authority) or the United States or foreign regulatory authorities, in
each case pursuant to Basel III, shall in each case be deemed to be a “Change in
Law”, regardless of the date enacted, adopted or issued.

“Change of Control” means an event or series of events by which:

(a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d)
of the Securities Exchange Act of 1934, but excluding any employee benefit plan
of such person or its subsidiaries, and any person or entity acting in its
capacity as trustee, agent or other fiduciary or administrator of any such plan)
becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the
Securities Exchange Act of 1934, except that a person or group shall be deemed
to have “beneficial ownership” of all securities that such person or group has
the right to acquire, whether such right is exercisable immediately or only
after the passage of time (such right, an “option right”)), directly or
indirectly, of 35% or more of the equity securities of the Borrower entitled to
vote for members of the board of directors or equivalent governing body of the
Borrower on a fully-diluted basis (and taking into account all such securities
that such “person” or “group” has the right to acquire pursuant to any option
right); or

(b) during any period of 12 consecutive months, a majority of the members of the
board of directors or other equivalent governing body of the Borrower cease to
be composed of individuals (i) who were members of that board or equivalent
governing body on the first day of such period, (ii) whose election or
nomination to that board or equivalent governing body was approved by
individuals referred to in clause (i) above constituting at the time of such
election or nomination at least a majority of that board or equivalent governing
body, or (iii) whose election or nomination to that board or other equivalent
governing body was approved by individuals referred to in clauses (i) and (ii)
above constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body; or

(c) the passage of 30 days from the date upon which any Person or two or more
Persons acting in concert shall have acquired by contract or otherwise, or shall
have entered into a contract or arrangement that, upon consummation thereof,
will result in its or their acquisition of the power to exercise, directly or
indirectly, a controlling influence over the management or policies of the
Borrower, or control over the equity securities of the Borrower entitled to vote
for members of the board of directors or equivalent governing body of the
Borrower on a fully-diluted basis (and taking into account all such securities
that such Person or Persons have the right to acquire pursuant to any option
right) representing 35% or more of the combined voting power of such securities;
or

(d) a “change of control” or any comparable term under, and as defined in, any
of the Senior Notes Documents or any other significant debt shall have occurred.

“Closing Date” means the first date all the conditions precedent in Section 4.01
are satisfied or waived in accordance with Section 10.01.

 

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“Code” means the Internal Revenue Code of 1986, as amended, and any successor
statute.

“Collateral” means all of the “Collateral” referred to in the Collateral
Documents and all of the other property that is or is intended under the terms
of the Collateral Documents to be subject to Liens in favor of the
Administrative Agent for the benefit of the Secured Parties; but, for the
avoidance of doubt, Collateral shall not include any equity interest in the Loan
Parties or any of their Subsidiaries.

“Collateral Documents” means, collectively, the Security Agreement, Security
Agreement Supplements, security agreements, pledge agreements, landlord’s
agreements, control agreements or other similar agreements delivered to the
Administrative Agent pursuant to Section 4.01 and Section 6.12, and each of the
other agreements, instruments or documents that creates or purports to create a
Lien in favor of the Administrative Agent for the benefit of the Secured
Parties.

“Collateral Rights Agreement” means that certain Collateral Rights Agreement
dated as of the Closing Date among the Administrative Agent, the Senior Notes
Trustee and the Loan Parties, in form and substance satisfactory to the
Administrative Agent.

“Commitment” means, as to each Lender, its obligation to (a) make Revolving
Credit Loans to the Borrower pursuant to Section 2.01, (b) purchase
participations in L/C Obligations, and (c) purchase participations in Swing Line
Loans, in an aggregate principal amount at any one time outstanding not to
exceed the amount set forth opposite such Lender’s name on Schedule 1.01 under
the caption “Commitment” or opposite such caption in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable,
as such amount may be adjusted from time to time in accordance with this
Agreement.

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et
seq.), as amended from time to time, and any successor statute.

“Compliance Certificate” means a certificate substantially in the form of
Exhibit D.

“Connection Income Taxes” means Other Connection Taxes that are imposed on or
measured by net income (however denominated) or that are franchise Taxes or
branch profits Taxes.

“Consolidated EBITDA” means, at any date of determination, an amount equal to
Consolidated Net Income of the Borrower and its Restricted Subsidiaries on a
consolidated basis for the most recently completed Measurement Period plus
(a) without duplication, the following to the extent deducted in calculating
such Consolidated Net Income: (i) Consolidated Interest Charges, (ii) the
provision for federal, state, local and foreign income taxes payable,
(iii) depreciation and amortization expense (including amortization of
intangibles, but excluding amortization of prepaid cash expenses that were paid
in a prior Measurement Period), (iv) impairment (other than any impairment in
respect of Collateral) and other expenses reducing such Consolidated Net Income
which do not represent a cash item in such period or any future period,
(v) stock-based compensation expenses which do not represent a cash item in such
period or any future period (in each case of or by the Borrower and its
Restricted Subsidiaries for such Measurement Period), (vi) the write-off of
unamortized deferred financing, legal and accounting costs in connection with
the refinancing of the Receivables Facility Agreement and the Term Loan

 

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Agreement on the Closing Date, (vii) prepayment premiums, redemption premiums,
fees, and other amounts expensed in connection with the redemption or prepayment
of the Receivables Facility Agreement and the Term Loan Agreement on the Closing
Date; (viii) any reasonable and customary fees, expenses, charges or losses
(other than depreciation or amortization expense) related to any public or
private sale of Qualified Capital Stock of the Company or options, warrants or
rights with respect to its Qualified Capital Stock (other than sales made to any
Subsidiary of the Borrower and sales of Disqualified Capital Stock) made for
cash after Closing Date, Material Acquisitions, Material Dispositions or the
incurrence of Indebtedness permitted to be incurred under this Agreement
(including a refinancing thereof), in each case regardless of whether
successful, and including such fees, expenses, charges or losses related to
(a) the offering of the Senior Notes and the Indebtedness under this Agreement
and (b) any amendment or other modification of the Senior Notes or the Loan
Documents and, in each case, deducted (and not added back) in computing such
Consolidated Net Income; provided that the amounts added pursuant to this clause
subclause (viii), together with any amounts added pursuant to subclause
(ix) below, shall not in the aggregate exceed, in any Measurement Period, 15% of
Consolidated EBITDA for such Measurement Period (prior to giving effect to the
addbacks pursuant to this subclause (viii) and subclause (ix)), and (ix) the
amount of any restructuring charge or reserve, integration cost or other
business optimization expense during such Measurement Period and severance
costs; provided that the amounts added pursuant to this clause subclause (ix),
together with any amounts added pursuant to subclause (viii) above, shall not in
the aggregate exceed, in any Measurement Period, 15% of Consolidated EBITDA for
such Measurement Period (prior to giving effect to the addbacks pursuant to
subclause (viii) and this subclause (ix)), and minus (b) the following to the
extent included in calculating such Consolidated Net Income: (i) federal, state,
local and foreign income tax credits and (ii) all non-cash items increasing
Consolidated Net Income (in each case of or by the Borrower and its Restricted
Subsidiaries for such Measurement Period). Consolidated EBITDA shall be
calculated for each Measurement Period, on a Pro Forma Basis, after giving
effect to, without duplication, any Material Acquisition (as defined below) and
any Material Disposition (as defined below) and, at the Borrower’s election, any
other Acquisition or Disposition, in each case, made during each period
commencing on the first day of such period to and including the date of such
transaction (the “Reference Period”) as if such Acquisition or Disposition and
any related incurrence or repayment of Indebtedness occurred on the first day of
the Reference Period. As used in this definition, “Material Acquisition” means
any Acquisition with Acquisition Consideration of $3,000,000 or more and
“Material Disposition” means any Disposition resulting in net sale proceeds of
$10,000,000 or more.

“Consolidated Fixed Charge Coverage Ratio” means the ratio, determined on a
consolidated basis for the Borrower and its Restricted Subsidiaries for the most
recent Measurement Period of (a) Consolidated EBITDA minus Capital Expenditures
(except those financed with borrowed money other than Revolver Loans or Equity
Proceeds) and cash taxes paid, to (b) Consolidated Fixed Charges.
Notwithstanding anything herein to the contrary, for the purposes of calculating
the Consolidated Fixed Charge Coverage Ratio and the components thereof, all
Unrestricted Subsidiaries and their Subsidiaries (including their assets,
liabilities, income, losses, cash flows, and the elements thereof) shall be
excluded, except for any cash dividends or distributions actually paid by any
Unrestricted Subsidiary or any of its Subsidiaries to a Loan Party, which shall
be deemed to be income to such Loan Party when actually received by it.

 

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“Consolidated Fixed Charges” means the sum of Consolidated Interest Charges
(other than payment-in-kind or amortization of fees and other non-cash items
treated as interest in accordance with GAAP), scheduled principal payments and
voluntary prepayments made on borrowed money (including purchase money
Indebtedness, Attributable Indebtedness and the deferred purchase price of
property or services), and Restricted Payments made.

“Consolidated Interest Charges” means, for any Measurement Period, the sum of
(a) all interest, premium payments, debt discount, fees, charges and related
expenses in connection with borrowed money (including capitalized interest) or
in connection with the deferred purchase price of assets, in each case to the
extent treated as interest in accordance with GAAP, (b) all interest paid or
payable with respect to discontinued operations and (c) the portion of rent
expense under Capitalized Leases that is treated as interest in accordance with
GAAP, in each case, of or by the Borrower and its Restricted Subsidiaries on a
consolidated basis for the most recently completed Measurement Period.

“Consolidated Net Income” means, at any date of determination, the net income
(or loss) of the Borrower and its Restricted Subsidiaries on a consolidated
basis for the most recently completed Measurement Period; provided that
Consolidated Net Income shall exclude (a) extraordinary gains and extraordinary
losses for such Measurement Period, (b) the net income of any Restricted
Subsidiary during such Measurement Period to the extent that the declaration or
payment of dividends or similar distributions by such Restricted Subsidiary of
such income is not permitted by operation of the terms of its Organization
Documents or any agreement, instrument or Law applicable to such Restricted
Subsidiary during such Measurement Period, except that the Borrower’s equity in
any net loss of any such Restricted Subsidiary for such Measurement Period shall
be included in determining Consolidated Net Income, (c) any income (or loss) for
such Measurement Period of any Person if such Person is not a Restricted
Subsidiary, except that the Borrower’s equity in the net income of any such
Person for such Measurement Period shall be included in Consolidated Net Income
up to the aggregate amount of cash actually distributed by such Person during
such Measurement Period to the Borrower or a Restricted Subsidiary as a dividend
or other distribution (and in the case of a dividend or other distribution to a
Restricted Subsidiary, such Restricted Subsidiary is not precluded from further
distributing such amount to the Borrower as described in clause (b) of this
proviso), and (d) the effects of non-cash adjustments in such Person’s
consolidated financial statements pursuant to GAAP resulting from the
application of “fresh start accounting” implemented in accordance with FASB ASC
852.

“Consolidated Tangible Assets” means, with respect to any Person as of any date,
the amount which, in accordance with GAAP, would be set forth under the caption
“Total Assets” (or any like caption) on a consolidated balance sheet of such
Person and its consolidated Subsidiaries, less all assets that are considered to
be intangible assets under GAAP, including customer lists, goodwill, computer
software, copyrights, trade names, trademarks, patents, franchises, licenses,
unamortized deferred charges, unamortized debt discount and capitalized research
and development costs.

“Contractual Obligation” means, as to any Person, any provision of any security
issued by such Person or of any agreement, instrument or other undertaking to
which such Person is a party or by which it or any of its property is bound.

 

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“Control” means the possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise.
“Controlling” and “Controlled” have meanings correlative thereto.

“Credit Extension” means each of the following: (a) a Borrowing and (b) an L/C
Credit Extension.

“Debtor Relief Laws” means the Bankruptcy Code of the United States, and all
other liquidation, conservatorship, bankruptcy, assignment for the benefit of
creditors, moratorium, rearrangement, receivership, insolvency, reorganization,
or similar debtor relief Laws of the United States or other applicable
jurisdictions from time to time in effect and affecting the rights of creditors
generally.

“Default” means any event or condition that constitutes an Event of Default or
that, with the giving of any notice, the passage of time, or both, would be an
Event of Default.

“Default Rate” means (a) when used with respect to Obligations other than Letter
of Credit Fees, an interest rate equal to (i) the Base Rate plus (ii) the
Applicable Rate applicable to Base Rate Loans plus (iii) 2% per annum; provided,
however, that with respect to a LIBOR Loan, the Default Rate shall be an
interest rate equal to the interest rate (including any Applicable Rate)
otherwise applicable to such Loan plus 2% per annum and (b) when used with
respect to Letter of Credit Fees, a rate equal to the Applicable Rate plus 2%
per annum.

“Defaulting Lender” means, subject to Section 2.16(b), any Lender that (a) has
failed to (i) fund all or any portion of its Loans within two (2) Business Days
of the date such Loans were required to be funded hereunder unless such Lender
notifies the Administrative Agent and the Borrower in writing that such failure
is the result of such Lender’s determination that one or more conditions
precedent to funding (each of which conditions precedent, together with any
applicable default, shall be specifically identified in such writing) has not
been satisfied, or (ii) pay to the Administrative Agent, any L/C Issuer, any
Swing Line Lender or any other Lender any other amount required to be paid by it
hereunder (including in respect of its participation in Letters of Credit or
Swing Line Loans) within two (2) Business Days of the date when due, (b) has
notified the Borrower, the Administrative Agent, the applicable L/C Issuer or
the applicable Swing Line Lender in writing that it does not intend to comply
with its funding obligations hereunder, or has made a public statement to that
effect (unless such writing or public statement relates to such Lender’s
obligation to fund a Loan hereunder and states that such position is based on
such Lender’s determination that a condition precedent to funding (which
condition precedent, together with any applicable default, shall be specifically
identified in such writing or public statement) cannot be satisfied), (c) has
failed, within three (3) Business Days after written request by the
Administrative Agent or the Borrower, to confirm in writing to the
Administrative Agent and the Borrower that it will comply with its prospective
funding obligations hereunder (provided that such Lender shall cease to be a
Defaulting Lender pursuant to this clause (c) upon receipt of such written
confirmation by the Administrative Agent and the Borrower), or (d) has, or has a
direct or indirect parent company that has, (i) become the subject of a
proceeding under any Debtor Relief Law, (ii) had appointed for it a receiver,
custodian, conservator, trustee, administrator, assignee for the benefit of
creditors or similar Person charged with reorganization or liquidation of its

 

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business or assets, including the Federal Deposit Insurance Corporation or any
other state or federal regulatory authority acting in such a capacity, or
(iii) becomes subject to a Bail-In Action; provided that a Lender shall not be a
Defaulting Lender solely by virtue of the ownership or acquisition of any Equity
Interest in that Lender or any direct or indirect parent company thereof by a
Governmental Authority so long as such ownership interest does not result in or
provide such Lender with immunity from the jurisdiction of courts within the
United States or from the enforcement of judgments or writs of attachment on its
assets or permit such Lender (or such Governmental Authority) to reject,
repudiate, disavow or disaffirm any contracts or agreements made with such
Lender. Any determination by the Administrative Agent that a Lender is a
Defaulting Lender under any one or more of clauses (a) through (d) above, and
the effective date of such status, shall be conclusive and binding absent
manifest error, and such Lender shall be deemed to be a Defaulting Lender
(subject to Section 2.16(b)) as of the date established therefor by the
Administrative Agent in a written notice of such determination, which shall be
delivered by the Administrative Agent to the Borrower, each L/C Issuer, each
Swing Line Lender and each other Lender promptly following such determination.

“Designated Jurisdiction” means any country or territory that is the target of a
Sanction.

“Dilution Percent” means the percent, determined for the Borrower’s most recent
fiscal quarter, equal to (a) bad debt write-downs or write-offs, discounts,
returns, promotions, credits, credit memos and other dilutive items with respect
to Accounts, divided by (b) gross sales.

“Dilution Reserve” means the aggregate amount of reserves in an amount equal to
the Value of the Eligible Accounts multiplied by 1.0% for each percentage point
(or portion thereof) that the Dilution Percent exceeds 5.0%.

“Disqualified Capital Stock” means any Equity Interest which, by its terms (or
by the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, (a) matures (excluding any
maturity as the result of an optional redemption by the issuer thereof) or is
mandatorily redeemable for any consideration other than solely an Equity
Interest in such Person (which would constitute Qualified Capital Stock),
pursuant to a sinking fund obligation or otherwise, or is redeemable at the
option of the holder thereof for any consideration other than solely an Equity
Interest in such Person (which would constitute Qualified Capital Stock) at the
option of the holder thereof, in whole or in part on or prior to the date that
is 181 days after the earlier of the Maturity Date and payment in full of the
Obligations, (b) is convertible into or exchangeable (unless at the sole option
of the issuer thereof) for (i) debt securities or (ii) any Equity Interests
referred to in (a) above, or (c) contains any repurchase obligation on or prior
to the date that is 181 days after the earlier of the Maturity Date and payment
in full of the Obligations.

“Disposition” or “Dispose” means the sale, transfer, license, lease or other
disposition (including any sale and leaseback transaction) of any property by
any Person including any sale, assignment, transfer or other disposal, with or
without recourse, of any notes or accounts receivable or any rights and claims
associated therewith.

“Dollar” and “$” mean lawful money of the United States.

 

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“Domestic Subsidiary” means any Subsidiary that is organized under the laws of
any political subdivision of the United States.

“Dominion Account” means a special account established by the Borrower or any
Guarantor at Bank of America or another bank acceptable to the Administrative
Agent, over which the Administrative Agent has exclusive control for withdrawal
purposes.

“Earn Out Obligation” means those contingent obligations of the Borrower or any
Guarantor incurred in favor of a seller (or other third party entitled thereto)
under or with respect to any Permitted Acquisition.

“EEA Financial Institution” means (a) any credit institution or investment firm
established in any EEA Member Country which is subject to the supervision of an
EEA Resolution Authority, (b) any entity established in an EEA Member Country
which is a parent of an institution described in clause (a) of this definition,
or (c) any financial institution established in an EEA Member Country which is a
subsidiary of an institution described in clauses (a) or (b) of this definition
and is subject to consolidated supervision with its parent.

“EEA Member Country” means any of the member states of the European Union,
Iceland, Liechtenstein and Norway.

“EEA Resolution Authority” means any public administrative authority or any
Person entrusted with public administrative authority of an EEA Member Country
(including any delegee) having responsibility for the resolution of any EEA
Financial Institution.

“Eligible Account” means an Account owing to a Loan Party that arises in the
ordinary course of business from the sale or lease of inventory or rendition of
services, is invoiced and payable in Dollars and is deemed by the Administrative
Agent, in its Permitted Discretion, to be an Eligible Account. Without limiting
the foregoing, no Account shall be an Eligible Account if (a) it is unpaid for
more than 60 days after the original due date, or more than 90 days after the
original invoice date; (b) 50% or more of the Accounts owing by the Account
Debtor are not Eligible Accounts under the foregoing clause; (c) when aggregated
with other Accounts owing by the Account Debtor or affiliated Account Debtors,
it exceeds 20% of the aggregate Eligible Accounts (or such higher percentage as
the Administrative Agent may establish for the Account Debtor from time to time)
to the extent the obligations owing by such Account Debtor are in excess of such
percentage; (d) any representation or warranty contained herein or in the
Security Agreement with respect to such Account has been breached, or any
covenant contained herein or in the Security Agreement with respect to such
Account has been breached; (e) it is owing by a creditor or supplier, or is
otherwise subject to a potential offset, counterclaim, dispute, deduction,
discount, recoupment, reserve, defense, chargeback, credit or allowance (but
ineligibility shall be limited to the amount thereof); (f) an Insolvency
Proceeding has been commenced by or against the Account Debtor; or the Account
Debtor has failed, has suspended or ceased doing business, is liquidating,
dissolving or winding up its affairs, is not Solvent, or is subject to Sanctions
or any specially designated nationals list maintained by OFAC; or such Loan
Party is not able to bring suit or enforce remedies against the Account Debtor
through judicial process; (g) the Account Debtor is organized or has its
principal offices or assets outside the United States or Canada, unless the
Account is supported by a letter of credit (delivered to and directly drawable
by the

 

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Administrative Agent) or credit insurance satisfactory in all respects to the
Administrative Agent; (h) it is owing by a Governmental Authority, unless the
Account Debtor is the United States or any department, agency or instrumentality
thereof and the Account has been assigned to the Administrative Agent in
compliance with the federal Assignment of Claims Act; (i) it is not subject to a
duly perfected, first priority Lien in favor of the Administrative Agent, or is
subject to any other Lien other than Liens that are permitted by
Section 7.01(c); (j) the goods giving rise to it have not been delivered to the
Account Debtor, the services giving rise to it have not been accepted by the
Account Debtor, or it otherwise does not represent a final sale; (k) it is
evidenced by Chattel Paper or an Instrument of any kind, or has been reduced to
judgment; (l) it arises from a sale of goods other than inventory, from a sale
to an Affiliate, from a sale on a cash-on-delivery, credit card, bill-and-hold,
sale-or-return, sale-on-approval, consignment, or other repurchase or return
basis, or from a sale for personal, family or household purposes; (m) it
represents a progress billing or retainage, or relates to services for which a
performance, surety or completion bond or similar assurance has been issued; or
(n) it includes a billing for interest, fees or late charges, but ineligibility
shall be limited to the extent thereof. In calculating delinquent portions of
Accounts under clauses (a) and (b), credit balances more than 90 days old will
be excluded.

“Eligible Assignee” means any Person that meets the requirements to be an
assignee under Section 10.06(b)(iii) and (v) (subject to such consents, if any,
as may be required under Section 10.06(b)(iii)).

“Eligible Unbilled Account” means an Account owing to a Loan Party which would
qualify as an Eligible Account except that the invoice with respect thereto has
not yet been submitted to the Account Debtor, so long as the period following
the date on which such Loan Party recognizes such Account in its books and
records and prior to the date of the issuance of the invoice with respect
thereto is less than 30 days.

“Environmental Laws” means any and all federal, state, local, and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements or governmental
restrictions relating to pollution and the protection of the environment or the
release of any materials into the environment, including those related to
hazardous substances or wastes, air emissions and discharges to waste or public
systems.

“Environmental Liability” means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower, any other Loan Party or any of their
respective Subsidiaries directly or indirectly resulting from or based upon
(a) violation of any Environmental Law, (b) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Materials,
(c) exposure to any Hazardous Materials, (d) the release or threatened release
of any Hazardous Materials into the environment or (e) any contract, agreement
or other consensual arrangement pursuant to which liability is assumed or
imposed with respect to any of the foregoing.

“Environmental Permit” means any permit, approval, identification number,
license or other authorization required under any Environmental Law.

 

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“Equity Interests” means, with respect to any Person, all of the shares of
capital stock of (or other ownership or profit interests in) such Person, all of
the warrants, options or other rights for the purchase or acquisition from such
Person of shares of capital stock of (or other ownership or profit interests in)
such Person, all of the securities convertible into or exchangeable for shares
of capital stock of (or other ownership or profit interests in) such Person or
warrants, rights or options for the purchase or acquisition from such Person of
such shares (or such other interests), and all of the other ownership or profit
interests in such Person (including partnership, member or trust interests
therein), whether voting or nonvoting, and whether or not such shares, warrants,
options, rights or other interests are outstanding on any date of determination
(provided, however, that debt securities that are or by their terms may be
convertible or exchangeable into or for Equity Interests shall not constitute
Equity Interests prior to conversion or exchange thereof).

“Equity Proceeds” means cash proceeds from the issuance of Qualified Capital
Stock.

“ERISA” means the Employee Retirement Income Security Act of 1974.

“ERISA Affiliate” means any trade or business (whether or not incorporated)
under common control with the Borrower within the meaning of Section 414(b) or
(c) of the Code (and Sections 414(m) and (o) of the Code for purposes of
provisions relating to Section 412 of the Code).

“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan;
(b) the withdrawal of the Borrower or any ERISA Affiliate from a Pension Plan
subject to Section 4063 of ERISA during a plan year in which such entity was a
“substantial employer” as defined in Section 4001(a)(2) of ERISA or a cessation
of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA
Affiliate from a Multiemployer Plan; (d) the filing of a notice of intent to
terminate, the treatment of a Pension Plan amendment as a termination under
Section 4041 or 4041A of ERISA; (e) the institution by the PBGC of proceedings
to terminate a Pension Plan; (f) any event or condition which constitutes
grounds under Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan; (g) the determination that any
Pension Plan is considered an at-risk plan or a plan in endangered or critical
status within the meaning of Sections 430, 431 and 432 of the Code or
Sections 303, 304 and 305 of ERISA; or (h) the imposition of any liability under
Title IV of ERISA, other than for PBGC premiums due but not delinquent under
Section 4007 of ERISA, upon the Borrower or any ERISA Affiliate.

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule
published by the Loan Market Association (or any successor person), as in effect
from time to time.

“Event of Default” has the meaning specified in Section 8.01.

“Excluded Property” shall have the meaning set forth in the Security Agreement.

“Excluded Swap Obligation” means, with respect to any Guarantor, any Swap
Obligation if, and to the extent that, all or a portion of the Guaranty of such
Guarantor of, or the grant by such Guarantor of a security interest to secure,
such Swap Obligation (or any Guaranty thereof) is or becomes illegal under the
Commodity Exchange Act or any rule, regulation or order of the Commodity Futures
Trading Commission (or the application or official interpretation of any
thereof) by virtue of such Guarantor’s failure for any reason to constitute an
“eligible contract participant” as defined in the Commodity Exchange Act
(determined after giving effect to Section 10.19

 

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and any other “keepwell, support or other agreement” for the benefit of such
Guarantor and any and all guarantees of such Guarantor’s Swap Obligations by
other Loan Parties) at the time the Guaranty of such Guarantor, or a grant by
such Guarantor of a security interest, becomes effective with respect to such
Swap Obligation. If a Swap Obligation arises under a master agreement governing
more than one swap, such exclusion shall apply only to the portion of such Swap
Obligation that is attributable to swaps for which such Guaranty or security
interest is or becomes excluded in accordance with the first sentence of this
definition.

“Excluded Taxes” means, with respect to any Recipient of any payment to be made
by or on account of any obligation of the Borrower hereunder, (a) Taxes imposed
on or measured by its overall net income (however denominated), franchise Taxes
, and branch profits Taxes, in each case, (i) imposed as a result of such
Recipient being organized under the laws of, or having its principal office or,
in the case of any Lender, its applicable lending office located in, the
jurisdiction imposing such Tax (or any political subdivision thereof) or
(ii) that are Other Connection Taxes (b) in the case of a Lender, any United
States withholding Tax that is imposed on amounts payable to or for the account
of such Lender pursuant to the Laws in effect on the date on which (i) such
Lender acquires an interest in the Loan or Commitment (other than pursuant to an
assignment request by the Borrower under Section 10.13), or (ii) such Lender
designates a new Lending Office, except to the extent that such Lender (or its
assignor, if any) was entitled, at the time of designation of a new Lending
Office (or assignment), to receive additional amounts from the Borrower with
respect to such withholding Tax pursuant to Section 3.01(a), (c) Taxes
attributable to such Recipient’s failure to comply with Section 3.01(e), and
(d) any U.S. federal withholding Taxes imposed by FATCA.

“Existing Letters of Credit” means those certain Letters of Credit that (a) were
issued by Bank of America prior to the Closing Date and were cash collateralized
pursuant to that certain Cash Collateral Agreement dated as of September 29,
2017, between the Borrower and Bank of America, (b) are outstanding on the
Closing Date and (c) are listed on Schedule 1.01(a).

“FASB ASC” means the Accounting Standards Codification of the Financial
Accounting Standards Board.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this
Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with), any current or future
regulations or official interpretations thereof and any agreements entered into
pursuant to Section 1471(b)(1) of the Code.

“Federal Funds Rate” means, for any day, (a) the weighted average per annum
interest rate on overnight federal funds transactions with members of the
Federal Reserve System on the applicable day (or the preceding Business Day, if
the applicable day is not a Business Day), as published by the Federal Reserve
Bank of New York on the next Business Day; or (b) if the rate is not so
published, the average per annum rate (rounded up to the nearest 1/8 of 1%)
charged to Bank of America on the applicable day on such transactions, as
determined by the Administrative Agent; provided, that in no event shall the
Federal Funds Rate be less than zero.

“Fee Letter” means the letter agreement, dated September 17, 2018, among the
Borrower, the Administrative Agent and MLPFS.

 

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“Financial Covenant Trigger Period” means the period (a) commencing on the day
that Availability is less than the greater of 12.5% of the Borrowing Base or
$18,750,000, and (b) continuing until, during each of the preceding 30
consecutive days, Availability has at all times exceeded the greater of 12.5% of
the Borrowing Base or $18,750,000.

“Foreign Lender” means any Lender that is not a U.S. Person.

“FRB” means the Board of Governors of the Federal Reserve System of the United
States.

“Fronting Exposure” means, at any time there is a Defaulting Lender, (a) with
respect to the L/C Issuers, such Defaulting Lender’s Applicable Percentage of
the outstanding L/C Obligations other than L/C Obligations as to which such
Defaulting Lender’s participation obligation has been reallocated to other
Lenders or Cash Collateralized in accordance with the terms hereof, (b) with
respect to the Swing Line Lenders, such Defaulting Lender’s Applicable
Percentage of Swing Line Loans other than Swing Line Loans as to which such
Defaulting Lender’s participation obligation has been reallocated to other
Lenders or Cash Collateralized in accordance with the terms hereof and (c) with
respect to the Administrative Agent, such Defaulting Lender’s Applicable
Percentage of Protective Advances other than Protective Advances as to which
such Defaulting Lender’s participation obligation has been reallocated to other
Lenders or Cash Collateralized in accordance with the terms hereof.

“Fund” means any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its activities.

“GAAP” means generally accepted accounting principles in the United States set
forth from time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board (or
agencies with similar functions of comparable stature and authority within the
accounting profession) including, without limitation, the FASB Accounting
Standards Codification, that are applicable to the circumstances as of the date
of determination, consistently applied and subject to Section 1.03.

“Governmental Authority” means the government of the United States or any other
nation, or of any political subdivision thereof, whether state or local, and any
agency, authority, instrumentality, regulatory body, court, central bank or
other entity exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government (including any
supra-national bodies such as the European Union or the European Central Bank).

“Guarantee” means, as to any Person, (a) any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other obligation payable or performable by
another Person (the “primary obligor”) in any manner, whether directly or
indirectly, and including any obligation of such Person, direct or indirect,
(i) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation, (ii) to purchase or lease property,
securities or services for the purpose of assuring the obligee in respect of
such Indebtedness or other obligation of the payment or

 

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performance of such Indebtedness or other obligation, (iii) to maintain working
capital, equity capital or any other financial statement condition or liquidity
or level of income or cash flow of the primary obligor so as to enable the
primary obligor to pay such Indebtedness or other obligation, or (iv) entered
into for the purpose of assuring in any other manner the obligee in respect of
such Indebtedness or other obligation of the payment or performance thereof or
to protect such obligee against loss in respect thereof (in whole or in part),
or (b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person (or any right, contingent or otherwise, of
any holder of such Indebtedness to obtain any such Lien). The amount of any
Guarantee shall be deemed to be an amount equal to the stated or determinable
amount of the related primary obligation, or portion thereof, in respect of
which such Guarantee is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof as determined by the
guaranteeing Person in good faith. The term “Guarantee” as a verb has a
corresponding meaning.

“Guarantors” means, collectively, (a) the Domestic Subsidiaries of the Borrower
listed on Schedule 6.12 and each other Domestic Subsidiary of the Borrower that
shall be required to execute and deliver a guaranty or guaranty supplement
pursuant to Section 6.12 and (b) with respect to the payment and performance by
each Specified Loan Party of its obligations under its Guaranty with respect to
all Swap Obligations, the Borrower.

“Guaranty” means the Guaranty made by the Guarantors in favor of the Secured
Parties, together with each other guaranty and guaranty supplement delivered
pursuant to Section 6.12.

“Hazardous Materials” means all explosive or radioactive substances or wastes
and all hazardous or toxic substances, wastes or other pollutants, including
petroleum or petroleum distillates, asbestos or asbestos-containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all other
substances or wastes of any nature regulated pursuant to any Environmental Law.

“Hedge Bank” means any Person in its capacity as a party to Swap Contract that,
(a) at the time it enters into an interest rate Swap Contract not prohibited
under Article VI or VII, is a Lender or an Affiliate of a Lender, or (b) at the
time it (or its Affiliate) becomes a Lender, is a party to Swap Contract not
prohibited under Article VI or VII, in each case, in its capacity as a party to
such Swap Contract (even if such Person ceases to be a Lender or such Person’s
Affiliate ceased to be a Lender); provided, in the case of a Secured Hedge
Agreement with a Person who is no longer a Lender (or Affiliate of a Lender),
such Person shall be considered a Hedge Bank only through the stated termination
date (without extension or renewal) of such Secured Hedge Agreement and provided
further that for any of the foregoing to be included as a “Secured Hedge
Agreement” on any date of determination by the Administrative Agent, the
applicable Hedge Bank (other than the Administrative Agent or an Affiliate of
the Administrative Agent) must have delivered a Secured Party Designation Notice
to the Administrative Agent prior to such date of determination.

“Immaterial Domestic Subsidiary” means any Domestic Subsidiary that (i) does not
own any Collateral, (ii) generates less than 2.5% of Consolidated EBITDA for the
Measurement Period most recently ended for which financial statements of the
Borrower are available, and (iii) owns net assets that have an aggregate fair
market value of less than 2.5% of Consolidated Tangible Assets of the Borrower
as of the end of the fiscal quarter most recently ended.

 

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“Indebtedness” means, as to any Person at a particular time, without
duplication, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP:

(a) all obligations of such Person for borrowed money and all obligations of
such Person evidenced by bonds, debentures, notes, loan agreements or other
similar instruments;

(b) the maximum amount of all direct or contingent obligations of such Person
arising under letters of credit (including standby and commercial), bankers’
acceptances, bank guaranties, surety bonds and similar instruments;

(c) net obligations of such Person under any Swap Contract;

(d) all obligations of such Person to pay the deferred purchase price of
property or services (other than trade accounts payable in the ordinary course
of business and not past due for more than 90 days after the date on which such
trade account was created);

(e) indebtedness (excluding prepaid interest thereon) secured by a Lien on
property owned or being purchased by such Person (including indebtedness arising
under conditional sales or other title retention agreements), whether or not
such indebtedness shall have been assumed by such Person or is limited in
recourse; provided that, if such indebtedness is limited in recourse, then the
amount of such indebtedness for purposes of this Agreement will not exceed the
fair market value of such property;

(f) all Attributable Indebtedness with respect to Capitalized Leases and
Synthetic Lease Obligations of such Person and all Synthetic Debt of such
Person;

(g) all Disqualified Capital Stock; and

(h) all Guarantees of such Person in respect of any of the foregoing.

(i) For all purposes hereof, the Indebtedness of any Person shall include the
Indebtedness of any partnership or joint venture (other than a joint venture
that is itself a corporation or limited liability company) in which such Person
is a general partner or a joint venturer, unless such Indebtedness is expressly
made non-recourse to such Person. The amount of any net obligation under any
Swap Contract on any date shall be deemed to be the Swap Termination Value
thereof as of such date.

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or
with respect to any payment made by or on account of any obligation of the
Borrower under any Loan Document and (b) to the extent not otherwise described
in (a), Other Taxes.

“Indemnitees” has the meaning specified in Section 10.04(b).

“Information” has the meaning specified in Section 10.07.

 

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“Insolvency Proceeding” means any case or proceeding commenced by or against a
Person under any state, federal or foreign law for, or any agreement of such
Person to, (a) the entry of an order for relief under the Bankruptcy Code of the
United States, or any other insolvency, debtor relief or debt adjustment law;
(b) the appointment of a receiver, trustee, liquidator, administrator,
conservator or other custodian for such Person or any part of its property; or
(c) an assignment or trust mortgage for the benefit of creditors.

“Interest Payment Date” means, (a) as to any LIBOR Loan, the last day of each
Interest Period applicable to such Loan and the Maturity Date and (b) as to any
Base Rate Loan or Swing Line Loan, the first day of each April, July, October
and January and the Maturity Date.

“Interest Period” means, as to each LIBOR Loan, the period commencing on the
date such LIBOR Loan is disbursed or converted to or continued as a LIBOR Loan
and ending on the date one, two or three months thereafter (in each case,
subject to availability), as selected by the Borrower in its Revolving Credit
Loan Notice; provided that:

(a) any Interest Period that would otherwise end on a day that is not a Business
Day shall be extended to the next succeeding Business Day unless such Business
Day falls in another calendar month, in which case such Interest Period shall
end on the next preceding Business Day;

(b) any Interest Period that begins on the last Business Day of a calendar month
(or on a day for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall end on the last Business Day of
the calendar month at the end of such Interest Period; and

(c) no Interest Period shall extend beyond the Maturity Date.

“Investment” means, as to any Person, any direct or indirect acquisition or
investment by such Person, whether by means of (a) the purchase or other
acquisition of Equity Interests of another Person, (b) a loan, advance or
capital contribution to, Guarantee or assumption of debt of, or purchase or
other acquisition of any other debt or interest in, another Person, or (c) an
Acquisition. For purposes of covenant compliance, the amount of any Investment
shall be the amount actually invested, without adjustment for subsequent
increases or decreases in the value of such Investment.

“IP Rights” has the meaning specified in Section 5.17.

“IRS” means the United States Internal Revenue Service.

“ISP” means, with respect to any Letter of Credit, the “International Standby
Practices 1998” published by the Institute of International Banking Law &
Practice, Inc. (or such later version thereof as may be in effect at the time of
issuance).

“Issuer Documents” means with respect to any Letter of Credit, the Letter of
Credit Application, and any other document, agreement and instrument entered
into by an L/C Issuer and the Borrower (or any Subsidiary) or in favor of an L/C
Issuer and relating to such Letter of Credit.

 

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“Laws” means, collectively, all international, foreign, federal, state and local
statutes, treaties, rules, guidelines, regulations, ordinances, codes and
administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.

“L/C Advance” means, with respect to each Lender, such Lender’s funding of its
participation in any L/C Borrowing in accordance with its Applicable Percentage.

“L/C Borrowing” means an extension of credit resulting from a drawing under any
Letter of Credit which has not been reimbursed on the date when made or
refinanced as a Revolving Credit Borrowing.

“L/C Credit Extension” means, with respect to any Letter of Credit, the issuance
thereof or extension of the expiry date thereof, or the increase of the amount
thereof.

“L/C Issuer” means each of Bank of America, UBS AG, Stamford Branch, and PNC
Bank National Association, in its capacity as an issuer of Letters of Credit
hereunder, or any additional issuer of Letters of Credit hereunder selected by
the Borrower and acceptable to the Administrative Agent.

“L/C Issuer Sublimit” means, as to the initial Lenders, (a) $16,666,666.67, in
the case of Bank of America, (b) $16,666,666.67, in the case of UBS AG, Stamford
Branch, and (c) $16,666,666.66, in the case of PNC Bank National Association;
provided that Bank of America shall remain the L/C Issuer with respect to the
Existing Letters of Credit until their respective expiry dates as set forth on
Schedule 1.01(a) hereof, upon which expiry each such Letter of Credit, to the
extent renewal is requested, will be allocated by the Administrative Agent pro
rata among the L/C Issuers so as to correspond, to the extent reasonably
practicable, with each L/C Issuer’s L/C Issuer Sublimit as set forth herein.
Each L/C Issuer’s L/C Issuer Sublimit may be decreased or increased from time to
time with the written consent of the Borrower, the Administrative Agent and such
L/C Issuer. Effective upon an additional Lender agreeing to become a L/C Issuer
and issue Letters of Credit hereunder or to increase its L/C Issuer Sublimit,
the definition of L/C Issuer Sublimit shall be amended to reduce the respective
L/C Issuers’ L/C Issuer Sublimit by a like amount and to list such additional or
increasing L/C Issuer and its exposure hereunder.

“L/C Obligations” means, as at any date of determination, the aggregate amount
available to be drawn under all outstanding Letters of Credit plus the aggregate
of all Unreimbursed Amounts, including all L/C Borrowings. For purposes of
computing the amount available to be drawn under any Letter of Credit, the
amount of such Letter of Credit shall be determined in accordance with
Section 1.06. For all purposes of this Agreement, if on any date of
determination a Letter of Credit has expired by its terms but any amount may
still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP,
such Letter of Credit shall be deemed to be “outstanding” in the amount so
remaining available to be drawn.

 

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“Lender” has the meaning specified in the introductory paragraph hereto and, as
the context requires, includes the Swing Line Lenders.

“Lending Office” means, as to any Lender, the office or offices of such Lender
described as such in such Lender’s Administrative Questionnaire, or such other
office or offices as a Lender may from time to time notify the Borrower and the
Administrative Agent.

“Letter of Credit” means any standby letter of credit issued hereunder and shall
include the Existing Letters of Credit.

“Letter of Credit Application” means an application and agreement for the
issuance or amendment of a Letter of Credit in the form from time to time in use
by an L/C Issuer.

“Letter of Credit Expiration Date” means the day that is seven days prior to the
Maturity Date then in effect (or, if such day is not a Business Day, the next
preceding Business Day).

“Letter of Credit Fee” has the meaning specified in Section 2.03(h).

“Letter of Credit Report” means a certificate substantially the form of Exhibit
H or any other form approved by the Administrative Agent.

“Letter of Credit Sublimit” means an amount equal to $50,000,000. The Letter of
Credit Sublimit is part of, and not in addition to, the Aggregate Commitments.

“LIBOR” means the per annum rate of interest (rounded up to the nearest 1/8th of
1%) determined by the Administrative Agent at or about 11:00 a.m. (London time)
two Business Days prior to an Interest Period, for a term equivalent to such
period, equal to the London interbank offered rate, or comparable or successor
rate approved by the Administrative Agent, as published on the applicable
Reuters screen page (or other commercially available source designated by the
Administrative Agent from time to time); provided, that any comparable or
successor rate shall be applied by the Administrative Agent, if administratively
feasible, in a manner consistent with market practice; and provided further,
that in no event shall LIBOR be less than zero.

“LIBOR Loan” means a Loan that bears interest based on LIBOR or each set of
Loans bearing interest based on LIBOR having a common length and commencement of
Interest Period, as context requires.

“LIBOR Screen Rate” has the meaning specified in Section 1.09.

“LIBOR Successor Rate” has the meaning specified in Section 1.09.

“LIBOR Successor Rate Conforming Changes” means with respect to any proposed
LIBOR Successor Rate, any conforming changes to this Agreement, including
changes to Base Rate, Interest Period, timing and frequency of determining rates
and payments of interest and other administrative matters as may be appropriate,
in the Administrative Agent’s discretion, to reflect the adoption of such LIBOR
Successor Rate and to permit its administration by the Administrative Agent in a
manner substantially consistent with market practice (or, if the Administrative
Agent determines that adoption of any portion of such market practice is not
administratively feasible or

 

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that no market practice for the administration of such LIBOR Successor Rate
exists, in such other manner of administration as the Administrative Agent
determines in consultation with the Borrower). Such changes shall provide that
the LIBOR Successor Rate cannot be less than zero for purposes of this
Agreement.

“License” means any license or agreement under which a Loan Party is authorized
to use IP Rights in connection with any manufacture, marketing, distribution or
disposition of Collateral, any use of property or any other conduct of its
business.

“Lien” means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge, or preference,
priority or other security interest or preferential arrangement in the nature of
a security interest of any kind or nature whatsoever (including any conditional
sale or other title retention agreement, any easement, right of way or other
encumbrance on title to real property, and any financing lease having
substantially the same economic effect as any of the foregoing).

“Lien Waiver” means an agreement, in form and substance reasonably satisfactory
to the Administrative Agent, by which (a) for any material Collateral located on
leased premises, the lessor waives or subordinates any Lien it may have on the
Collateral, and agrees to permit the Administrative Agent to enter upon the
premises and remove the Collateral or to use the premises to store or dispose of
the Collateral; (b) for any Collateral held by a warehouseman, processor,
shipper, customs broker or freight forwarder, such Person waives or subordinates
any Lien it may have on the Collateral, agrees to hold any documents in its
possession relating to the Collateral as agent for the Administrative Agent, and
agrees to deliver the Collateral to the Administrative Agent upon request;
(c) for any Collateral held by a repairman, mechanic or bailee, such Person
acknowledges the Administrative Agent’s Lien, waives or subordinates any Lien it
may have on the Collateral, and agrees to deliver the Collateral to the
Administrative Agent upon request or permit the Administrative Agent to take
possession of the Collateral; or (d) for any Collateral subject to a licensor’s
intellectual property rights, the licensor grants to the Administrative Agent
the right, vis-à -vis such licensor, to enforce the Administrative Agent’s Liens
with respect to the Collateral, including the right to dispose of it with the
benefit of the intellectual property, whether or not a default exists under any
applicable license. Notwithstanding the foregoing, a Lien Waiver shall not be
required to be delivered in connection with Collateral that is temporarily
(i) located on leased premises, (ii) held by a warehouseman, processor, shipper,
customs broker or freight forwarder, or (iii) held by a repairman, mechanic or
bailee, in each case, for a period less than 60 days.

“Loan” means an extension of credit by a Lender to the Borrower under Article II
in the form of a Revolving Credit Loan or a Swing Line Loan.

“Loan Documents” means, collectively, (a) this Agreement, (b) the Notes, (c) the
Guaranty, (d) the Collateral Documents, (e) the Fee Letter, (f) the Collateral
Rights Agreement, (g) each Issuer Document, (h) any arrangements entered into by
any L/C Issuer and the Borrower pursuant to Section 2.03(a)(iii), and (i) any
agreement creating or perfecting rights in Cash Collateral pursuant to the
provisions of Section 2.15 of this Agreement.

“Loan Parties” means, collectively, the Borrower and each Guarantor.

 

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“London Banking Day” means any day on which dealings in Dollar deposits are
conducted by and between banks in the London interbank eurodollar market.

“Material Adverse Effect” means (a) a material adverse change in, or a material
adverse effect upon, the operations, business, properties, liabilities (actual
or contingent), or financial condition of the Borrower or the Borrower and its
Restricted Subsidiaries taken as a whole; (b) a material impairment of the
rights and remedies of the Administrative Agent or any Lender under any Loan
Document, or of the ability of the Loan Parties, taken as a whole, to perform
their obligations under the Loan Documents; or (c) a material adverse effect
upon the legality, validity, binding effect or enforceability against any Loan
Party of any Loan Document to which it is a party.

“Material Contract” means, with respect to any Person, any agreement or
instrument to which such Person is a party (other than the Loan Documents) (a)
that is deemed to be a material contract under any securities law applicable to
such Person, including the Securities Act of 1933, (b) that relates to
Indebtedness of such Person with an aggregate principal amount in excess of
$10,000,000 or (c) for which breach, termination, nonperformance or failure to
renew could reasonably be expected to have a Material Adverse Effect.

“Material Loan Party” shall mean (a) the Borrower and (b) any Restricted
Subsidiary that (i) owns any Collateral, (ii) generates more than 5.0% of
Consolidated EBITDA for the Measurement Period most recently ended for which
financial statements of the Borrower are available or (iii) owns net assets that
have an aggregate fair market value of 5.0% or more of Consolidated Tangible
Assets of the Borrower as of the end of the previous fiscal quarter.

“Maturity Date” means October 2, 2023; provided, however, that if such date is
not a Business Day, the Maturity Date shall be the next preceding Business Day;
provided further, that if an Acceptable Senior Notes Refinancing has not been
completed by July 3, 2023, then the “Maturity Date” shall be July 3, 2023.

“Measurement Period” means, at any date of determination, (a) the most recently
completed four fiscal quarters of the Borrower if a Monthly Financial Reporting
Trigger Period is not then in effect and has not been in effect for the
preceding 30 days or (b) at any other time, the most recently completed twelve
calendar months.

“Minimum Collateral Amount” means, at any time, (a) with respect to Cash
Collateral consisting of cash or deposit account balances provided to reduce or
eliminate Fronting Exposure during any period when a Lender constitutes a
Defaulting Lender, an amount equal to 105% of the Fronting Exposure of the L/C
Issuer with respect to Letters of Credit issued and outstanding at such time,
(b) with respect to Cash Collateral consisting of cash or deposit account
balances provided in accordance with the provisions of Section 2.15(a)(i) or
(a)(ii), an amount equal to 105% of the Outstanding Amount of all L/C
Obligations, and (c) otherwise, an amount determined by the Administrative Agent
and the L/C Issuer in their reasonable discretion.

“MLPFS” means Merrill Lynch, Pierce, Fenner & Smith Incorporated.

“Monthly Financial Reporting Trigger Period” means the period (a) commencing on
the day that Availability is less than the greater of (i) 15% of the Borrowing
Base or (ii) $22,500,000, and (b) continuing until, during each of the preceding
30 consecutive days, Availability has at all times exceeded the greater of (i)
15% of the Borrowing Base or (ii) $22,500,000.

 

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“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.

“Multiemployer Plan” means any employee benefit plan of the type described in
Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate makes
or is obligated to make contributions, or during the preceding five plan years,
has made or been obligated to make contributions.

“Multiple Employer Plan” means a Plan which has two or more contributing
sponsors (including the Borrower or any ERISA Affiliate) at least two of whom
are not under common control, as such a plan is described in Section 4064 of
ERISA.

“Non-Consenting Lender” means any Lender that does not approve any consent,
waiver or amendment that (a) requires the approval of all Lenders or all
affected Lenders in accordance with the terms of Section 10.01 and (b) has been
approved by the Required Lenders.

“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting
Lender at such time.

“Note” means a promissory note made by the Borrower in favor of a Lender
evidencing Revolving Credit Loans or Swing Line Loans, as the case may be, made
by such Lender, substantially in the form of Exhibit C.

“Notice of Loan Prepayment” means a notice of prepayment with respect to a Loan,
which shall be substantially in the form of Exhibit F or such other form as may
be approved by the Administrative Agent (including any form on an electronic
platform or electronic transmission system as shall be approved by the
Administrative Agent), appropriately completed and signed by a Responsible
Officer.

“NPL” means the National Priorities List under CERCLA.

“Obligations” means all advances to, and debts, liabilities, obligations,
covenants and duties of, any Loan Party arising under any Loan Document or
otherwise with respect to any Loan, Letter of Credit, Protective Advance,
Secured Cash Management Agreement or Secured Hedge Agreement, in each case
whether direct or indirect (including those acquired by assumption), absolute or
contingent, due or to become due, now existing or hereafter arising and
including interest and fees that accrue after the commencement by or against any
Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief
Laws naming such Person as the debtor in such proceeding, regardless of whether
such interest and fees are allowed claims in such proceeding; provided that
Obligations of a Guarantor shall exclude any Excluded Swap Obligations with
respect to such Guarantor.

“OFAC” means the Office of Foreign Assets Control of the United States
Department of the Treasury.

 

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“Organization Documents” means, (a) with respect to any corporation, the
certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b) with respect to any limited liability company, the certificate or articles
of formation or organization and operating agreement; and (c) with respect to
any partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or
organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the
applicable Governmental Authority in the jurisdiction of its formation or
organization and, if applicable, any certificate or articles of formation or
organization of such entity.

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as
a result of a present or former connection between such Recipient and the
jurisdiction imposing such Tax (other than connections arising from such
Recipient having executed, delivered, become a party to, performed its
obligations under, received payments under, received or perfected a security
interest under, engaged in any other transaction pursuant to or enforced any
Loan Document, or sold or assigned an interest in any Loan or Loan Document).

“Other Taxes” means all present or future stamp, court or documentary,
intangible, recording, filing or similar Taxes that arise from any payment made
under, from the execution, delivery, performance, enforcement or registration
of, from the receipt or perfection of a security interest under, or otherwise
with respect to, any Loan Document, except any such Taxes that are Other
Connection Taxes imposed with respect to an assignment (other than an assignment
made pursuant to Section 3.06(b)).

“Outstanding Amount” means (a) with respect to Revolving Credit Loans and Swing
Line Loans on any date, the aggregate outstanding principal amount thereof after
giving effect to any borrowings and prepayments or repayments of Revolving
Credit Loans and Swing Line Loans, as the case may be, occurring on such date;
and (b) with respect to any L/C Obligations on any date, the amount of such L/C
Obligations on such date after giving effect to any L/C Credit Extension
occurring on such date and any other changes in the aggregate amount of the L/C
Obligations as of such date, including as a result of any reimbursements by the
Borrower of Unreimbursed Amounts.

“Overadvance” means the amount by which Total Outstandings exceed the Borrowing
Base at any time.

“Participant” has the meaning specified in Section 10.06(d).

“Participant Register” has the meaning specified in Section 10.06(d).

“Patriot Act” means the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Pub.
L. No. 107-56, 115 Stat. 272 (2001).

 

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“Payment Conditions” means, in the case of Acquisitions, prepayments of
Indebtedness and Restricted Payments, that no Default or Event of Default has
occurred and is continuing or would result therefrom and the following:

(a) with respect to Acquisitions and prepayments of Indebtedness, either:

(i) Availability shall be higher than the greater of (A) 20% of the Borrowing
Base and (B) $30,000,000, in each case on a pro forma basis for each day during
the consecutive 30-day period immediately preceding such transaction and after
giving effect thereto as though such Acquisition or prepayment of Indebtedness
(and any Loans being requested to fund any part thereof) had been made on the
first day of such 30-day period; or

(ii) both (A) the Pro Forma Consolidated Fixed Charge Coverage Ratio after
giving effect to such transaction shall be greater than 1.00 to 1.00 for the
most recently reported Measurement Period, and (B) Availability shall be higher
than the greater of (1) 15% of the Borrowing Base and (2) $22,500,000, in the
case of this subclause (B) on a pro forma basis for each day during the
consecutive 30-day period immediately preceding such transaction and after
giving effect thereto as though such Acquisition or prepayment of Indebtedness
(and any Loans being requested to fund any part thereof) had been made on the
first day of such 30-day period;

(b) with respect to Restricted Payments, either:

(i) Availability shall be higher than the greater of (A) 22.5% of the Borrowing
Base and (B) $33,750,000, in each case on a pro forma basis for each day during
the consecutive 30-day period immediately preceding such Restricted Payment and
after giving effect thereto as though such Restricted Payment (and any Loans
being requested to fund any part thereof) had been made on the first day of such
30-day period; or

(ii) both (A) the Pro Forma Consolidated Fixed Charge Coverage Ratio after
giving effect to such transaction shall be greater than 1.00 to 1.00 for the
most recently reported Measurement Period, and (B) Availability shall be higher
than the greater of (1) 17.5% of the Borrowing Base and (2) $26,250,000, in the
case of this subclause (B) on a pro forma basis for each day during the
consecutive 30-day period immediately preceding such Restricted Payment and
after giving effect thereto as though such Restricted Payment (and any Loans
being requested to fund any part thereof) had been made on the first day of such
30-day period.

(c) in any case under (a) or (b) above, delivery to Administrative Agent at
least three (3) Business Days and not more than five (5) Business Days prior to
the date of the proposed Acquisition, prepayment of Indebtedness, or Restricted
Payment of a certificate of the Borrower signed by the chief executive officer,
chief financial officer, treasurer or controller of the Borrower giving notice
of the intent to consummate such Acquisition, prepayment of Indebtedness, or
Restricted Payment and certifying compliance with the applicable foregoing
conditions (including calculations of Availability for the applicable days and,
if applicable, of the Pro Forma Consolidated Fixed Charge Coverage Ratio).

“PBGC” means the Pension Benefit Guaranty Corporation.

 

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“P-Card Agreements” means, collectively, (i) that certain Bank of America
Corporate Purchasing Card Agreement between Bank of America, N.A. and Basic
Energy Services L.P., dated on or around July 21, 2005 and (ii) that certain
Commercial Prepaid Card Purchase Agreement between Bank of America, N.A. and
Basic Energy Services L.P., dated on or around March 14, 2006, each as may be
amended, supplemented or modified from time to time.

“Pension Act” means the Pension Protection Act of 2006.

“Pension Funding Rules” means the rules of the Code and ERISA regarding minimum
required contributions (including any installment payment thereof) to Pension
Plans and set forth in, with respect to plan years ending prior to the effective
date of the Pension Act, Section 412 of the Code and Section 302 of ERISA, each
as in effect prior to the Pension Act and, thereafter, Section 412, 430, 431,
432 and 436 of the Code and Sections 302, 303, 304 and 305 of ERISA.

“Pension Plan” means any employee pension benefit plan (including a Multiple
Employer Plan or a Multiemployer Plan) that is maintained or is contributed to
by the Borrower and any ERISA Affiliate and is either covered by Title IV of
ERISA or is subject to the minimum funding standards under Section 412 of the
Code.

“Permitted Acquisition” means, with respect to the Borrower or any Guarantor,
(i) any Acquisition by such Person for which the Acquisition Consideration
consists solely of Qualified Capital Stock or Equity Proceeds or any combination
of Qualified Capital Stock and Equity Proceeds of the Borrower, so long as no
Default or Event of Default exists at the time of such Acquisition and the
Acquisition could not reasonably be expected to cause a Default or Event of
Default immediately after giving effect thereto, or (ii) any other Acquisition
by such Person that satisfies each of the following requirements:

(a) no Default or Event of Default exists and the Acquisition could not
reasonably be expected to cause a Default or Event of Default immediately after
giving effect thereto;

(b) the Acquisition is not hostile;

(c) the lines of business of the Person to be (or the property of which is to
be) so purchased or otherwise acquired shall be substantially the same lines of
business as one or more of the principal businesses of the Borrower and its
Subsidiaries in the ordinary course;

(d) the requirements of Section 6.12 are satisfied;

(e) the Payment Conditions are satisfied before and after giving effect thereto;
and

(f) the Borrower shall have delivered to the Administrative Agent and each
Lender, at least five Business Days prior to the date on which any such
Acquisition is to be consummated, a certificate of a Responsible Officer, in
form and substance reasonably satisfactory to the Administrative Agent and the
Required Lenders, certifying that all of the foregoing requirements have been
satisfied or will be satisfied on or prior to the date on which such Acquisition
is consummated.

 

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“Permitted Discretion” means a determination made in good faith and in the
exercise of commercially reasonable (from the perspective of a secured
asset-based lender) business judgment.

“Permitted Water Subsidiary” means a Restricted Subsidiary with respect to which
the following requirements are satisfied:

(a) substantially all the assets of such Restricted Subsidiary consist of water
disposal wells, water processing equipment or facilities or water transportation
pipelines or related assets (other than vehicles);

(b) less than 50.0% of the economic or voting power of the Equity Interests of
such Restricted Subsidiary are held by Persons other than Loan Parties;

(c) the operations and policies of such Restricted Subsidiary are controlled by
the Borrower;

(d) the requirements of Section 6.12 are satisfied with respect to such
Restricted Subsidiary substantially contemporaneously with the acquisition or
formation of such Restricted Subsidiary; and

(e) the Organizational Documents of such Restricted Subsidiary are in form and
substance reasonably satisfactory to the Administrative Agent.

“Person” means any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership, Governmental Authority
or other entity.

“Plan” means any employee benefit plan within the meaning of Section 3(3) of
ERISA (including a Pension Plan), maintained for employees of the Borrower or
any ERISA Affiliate or any such Plan to which the Borrower or any ERISA
Affiliate is required to contribute on behalf of any of its employees.

“Platform” has the meaning specified in Section 6.02.

“Prime Rate” means the rate of interest announced by Bank of America from time
to time as its prime rate. Such rate is set by Bank of America on the basis of
various factors, including its costs and desired return, general economic
conditions and other factors, and is used as a reference point for pricing some
loans, which may be priced at, above or below such rate. Any change in such rate
publicly announced by Bank of America shall take effect at the opening of
business on the day specified in the announcement.

“Pro Forma Basis” means on a basis in accordance with GAAP and Regulation S X
and otherwise reasonably satisfactory to the Administrative Agent.

“Pro Forma Consolidated Fixed Charge Coverage Ratio” means the Consolidated
Fixed Charge Coverage Ratio, redetermined on a pro forma basis to include the
prepayment of Indebtedness or Restricted Payment, as applicable, as a
Consolidated Fixed Charge.

 

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“Protective Advances” has the meaning specified in Section 2.17.

“PTE” means a prohibited transaction class exemption issued by the U.S.
Department of Labor, as any such exemption may be amended from time to time.

“Public Lender” has the meaning specified in Section 6.02.

“Qualified Capital Stock” of any Person means any capital stock of such person
that is not Disqualified Capital Stock; provided that such capital stock shall
not be deemed Qualified Capital Stock to the extent sold or owed to a Subsidiary
of such person or financed, directly or indirectly, using funds (1) borrowed
from such person or any Subsidiary of such person until and to the extent such
borrowing is repaid or (2) contributed, extended, guaranteed or advanced by such
person or any Subsidiary of such person (including, without limitation, in
respect of any employee stock ownership or benefit plan). Unless otherwise
specified, Qualified Capital Stock refers to Qualified Capital Stock of
Borrower.

“Qualified ECP Guarantor” means, at any time, each Loan Party with total assets
exceeding $10,000,000 or that qualifies at such time as an “eligible contract
participant” under the Commodity Exchange Act and can cause another Person to
qualify as an “eligible contract participant” at such time under
Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

“Receivables Facility Agent” means UBS AG, Stamford Branch, as administrative
agent under the Receivables Facility Agreement.

“Receivables Facility Agreement” means the Credit and Security Agreement dated
as of September 29, 2017 (as amended and supplemented to date) among BER, Basic
Energy Services, L.P., the Borrower, UBS AG, Stamford Branch, as administrative
agent, and the lenders party thereto.

“Recipient” means (a) any Lender, (b) any L/C Issuer and (c) the Administrative
Agent, as applicable.

“Register” has the meaning specified in Section 10.06(c).

“Related Parties” means, with respect to any Person, such Person’s Affiliates
and the partners, directors, officers, employees, agents, trustees,
administrators, managers, advisors and representatives of such Person and of
such Person’s Affiliates.

“Removal Effective Date” has the meaning set forth in Section 9.06.

“Rent and Charges Reserve” means the aggregate of (a) all past due rent and
other amounts owing by a Loan Party to any landlord, warehouseman, processor,
repairman, mechanic, shipper, freight forwarder, broker or other Person who
possesses any Collateral or could assert a Lien on any Collateral; and (b) a
reserve at least equal to three months rent and other charges that could be
payable to any such Person, unless it has executed a Lien Waiver. Rent payable
under Capitalized Leases will not be included in the Rent and Charges Reserve.

 

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“Reportable Event” means any of the events set forth in Section 4043(c) of
ERISA, other than events for which the 30 day notice period has been waived.

“Request for Credit Extension” means (a) with respect to a Revolving Credit
Borrowing, conversion or continuation of Revolving Credit Loans, a Revolving
Credit Loan Notice, (b) with respect to an L/C Credit Extension, a Letter of
Credit Application, and (c) with respect to a Swing Line Loan, a Swing Line Loan
Notice.

“Required Lenders” means, as of any date of determination, two or more
unaffiliated Lenders holding more than 50% of the sum of the (a) Total
Outstandings (with the aggregate amount of each Lender’s risk participation and
funded participation in L/C Obligations and Swing Line Loans being deemed “held”
by such Lender for purposes of this definition) and (b) aggregate unused
Commitments; provided that the unused Commitment of, and the portion of the
Total Outstandings held or deemed held by, any Defaulting Lender shall be
excluded for purposes of making a determination of Required Lenders.

“Resignation Effective Date” has the meaning set forth in Section 9.06.

“Responsible Officer” means the chief executive officer, president, chief
financial officer, treasurer, assistant treasurer or controller of a Loan Party,
solely for purposes of the delivery of incumbency certificates pursuant to
Section 4.01, the secretary or any assistant secretary of a Loan Party and,
solely for purposes of notices given pursuant to Article II, any other officer
or employee of the applicable Loan Party so designated by any of the foregoing
officers in a notice to the Administrative Agent or any other officer or
employee of the applicable Loan Party designated in or pursuant to an agreement
between the applicable Loan Party and the Administrative Agent. Any document
delivered hereunder that is signed by a Responsible Officer of a Loan Party
shall be conclusively presumed to have been authorized by all necessary
corporate, partnership and/or other action on the part of such Loan Party and
such Responsible Officer shall be conclusively presumed to have acted on behalf
of such Loan Party. To the extent requested by the Administrative Agent, each
Responsible Officer will provide an incumbency certificate and to the extent
requested by the Administrative Agent, appropriate authorization documentation,
in form and substance satisfactory to the Administrative Agent.

“Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any capital stock or other Equity
Interest of any Person or any of its Subsidiaries, or any payment (whether in
cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, defeasance,
acquisition, cancellation or termination of any such capital stock or other
Equity Interest, or on account of any return of capital to any Person’s
stockholders, partners or members (or the equivalent of any thereof), or any
option, warrant or other right to acquire any such dividend or other
distribution or payment.

“Restricted Subsidiary” means any direct or indirect Domestic Subsidiary of the
Borrower that is not an Unrestricted Subsidiary.

 

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“Revolving Credit Borrowing” means a borrowing consisting of simultaneous
Revolving Credit Loans of the same Type and, in the case of LIBOR Loans, having
the same Interest Period made by each of the Lenders pursuant to Section 2.01.

“Revolving Credit Loan” has the meaning specified in Section 2.01.

“Revolving Credit Loan Notice” means a notice of (a) a Revolving Credit
Borrowing, (b) a conversion of Loans from one Type to the other, or (c) a
continuation of LIBOR Loans, pursuant to Section 2.02(a), which, if in writing,
shall be substantially in the form of Exhibit A, or such other form as may be
approved by the Administrative Agent (including any form on an electronic
platform or electronic transmission system, including electronic mail, as shall
be approved by the Administrative Agent), appropriately completed and signed by
a Responsible Officer of the Borrower.

“Revolving Credit Usage” means the sum of (a) the Outstanding Amount of
Revolving Credit Loans, plus (b) the Outstanding Amount of L/C Obligations.

“Robota” means Robota Energy Equipment, LLC, a Texas limited liability company.

“Royalties” means all royalties, fees, expense reimbursement and other amounts
payable by a Loan Party under a License.

“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc., and any successor thereto.

“Sanction” means any sanction administered or enforced by the United States
Government (including, without limitation, OFAC), the United Nations Security
Council, the European Union, Her Majesty’s Treasury or other relevant sanctions
authority.

“Scheduled Unavailability Date” has the meaning specified in Section 1.09.

“SEC” means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.

“Secured Bank Product Obligations” means all debt, obligations and other
liabilities owing under Secured Cash Management Agreements and Secured Hedge
Agreements; provided that Secured Bank Product Obligations of a Loan Party shall
not include the Excluded Swap Obligations of such Loan Party.

“Secured Cash Management Agreement” means any Cash Management Agreement that is
entered into by and between the Borrower or any Subsidiary and any Cash
Management Bank which has delivered a Secured Party Designation Notice.

“Secured Hedge Agreement” means any interest rate Swap Contract permitted under
Article VII that is entered into by and between the Borrower or any Subsidiary
and any Hedge Bank which has delivered a Secured Party Designation Notice.

 

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“Secured Parties” means, collectively, the Administrative Agent, the Lenders,
the L/C Issuers, the Hedge Banks, the Cash Management Banks, each co-agent or
sub-agent appointed by the Administrative Agent from time to time pursuant to
Section 9.05, and the other Persons the Obligations owing to which are or are
purported to be secured by the Collateral under the terms of the Collateral
Documents.

“Secured Party Designation Notice” means a notice from any Lender or an
Affiliate of a Lender, substantially in the form of Exhibit G, (a) describing
the Secured Cash Management Agreement or Secured Hedge Agreement and setting
forth the maximum amount to be secured by the Collateral and the methodology to
be used in calculating such amount and (b) agreeing to be bound by Section 9.11.

“Security Agreement” means that certain Security Agreement dated as of the
Closing Date, as amended and supplemented from time to time, executed by each of
the Loan Parties in favor of the Administrative Agent.

“Security Agreement Supplement” means the form of supplement attached to the
Security Agreement as Annex I.

“Senior Notes” means those certain 10.75% Senior Secured Notes due 2023 of the
Borrower in the aggregate principal amount of $300,000,000.

“Senior Notes Collateral Account” has the meaning specified in Section 6.18.

“Senior Notes Collateral Agency Agreement” means the “Collateral Agency
Agreement” as defined in the Senior Notes Indenture.

“Senior Notes Documents” means the “Note Documents” as defined in the Senior
Notes Indenture.

“Senior Notes Indenture” means the Indenture for the Senior Notes dated as of
October ___, 2018 between the Borrower and the Senior Notes Trustee.

“Senior Notes Trustee” means UMB Bank, N.A., in its capacity as trustee under
the Senior Notes Indenture or as collateral agent under the Senior Notes
Collateral Agency Agreement.

“Solvent” and “Solvency” mean, with respect to any Person on any date of
determination, after taking into account all other payments made by, and
indemnification payments from, and reimbursement and contribution obligations
of, any other Persons with respect thereto, that on such date (a) the fair value
of the property of such Person is greater than the total amount of liabilities,
including contingent liabilities, of such Person, (b) the present fair saleable
value of the assets of such Person is not less than the amount that will be
required to pay the probable liability of such Person on its debts as they
become absolute and matured, (c) such Person does not intend to, and does not
believe that it will, incur debts or liabilities beyond such Person’s ability to
pay such debts and liabilities as they mature, (d) such Person is not engaged in
business or a transaction, and is not about to engage in business or a
transaction, for which such Person’s property would constitute an unreasonably
small capital, and (e) such Person is able to pay its debts and liabilities,
contingent obligations and other commitments as they mature in the ordinary
course of business. The amount of contingent liabilities at any time shall be
computed as the amount that, in the light of all the facts and circumstances
existing at such time, represents the amount that can reasonably be expected to
become an actual or matured liability.

 

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“Specified Loan Party” means any Loan Party that is not an “eligible contract
participant” under the Commodity Exchange Act (determined prior to giving effect
to Section 10.19).

“Subsidiary” of a Person means a corporation, partnership, joint venture,
limited liability company or other business entity of which a majority of the
shares of securities or other interests having ordinary voting power for the
election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or both,
by such Person. Unless otherwise specified, all references herein to a
“Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary or Subsidiaries of
the Borrower.

“Super Majority Lenders” means, as of any date of determination, two or more
unaffiliated Lenders holding more than 66 2/3% of the sum of the (a) Total
Outstandings (with the aggregate amount of each Lender’s risk participation and
funded participation in L/C Obligations and Swing Line Loans being deemed “held”
by such Lender for purposes of this definition) and (b) aggregate unused
Commitments; provided that the unused Commitment of, and the portion of the
Total Outstandings held or deemed held by, any Defaulting Lender shall be
excluded for purposes of making a determination of Super Majority Lenders.

“Swap Contract” means (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a “Master Agreement”), including
any such obligations or liabilities under any Master Agreement.

“Swap Obligations” means with respect to any Guarantor any obligation to pay or
perform under any agreement, contract or transaction that constitutes a “swap”
within the meaning of Section 1a(47) of the Commodity Exchange Act.

“Swap Termination Value” means, in respect of any one or more Swap Contracts,
after taking into account the effect of any legally enforceable netting
agreement relating to such Swap Contracts, (a) for any date on or after the date
such Swap Contracts have been closed out and termination value(s) determined in
accordance therewith, such termination value(s), and (b) for

 

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any date prior to the date referenced in clause (a), the amount(s) determined as
the mark-to-market value(s) for such Swap Contracts, as determined based upon
one or more mid-market or other readily available quotations provided by any
recognized dealer in such Swap Contracts (which may include a Lender or any
Affiliate of a Lender).

“Swing Line Borrowing” means a borrowing of a Swing Line Loan pursuant to
Section 2.04.

“Swing Line Lender” means Bank of America, in its capacity as provider of Swing
Line Loans, and, at the request of the Borrower and subject to the consent of
the Administrative Agent in its sole discretion, any other swing line lender
that agrees to act as a provider of Swing Line Loans, or, in each case, any
successor swing line lender hereunder acceptable to the Administrative Agent.

“Swing Line Loan” has the meaning specified in Section 2.04(a).

“Swing Line Loan Notice” means a notice of a Swing Line Borrowing pursuant to
Section 2.04(b), which, if in writing, shall be substantially in the form of
Exhibit B or such other form as approved by the Administrative Agent (including
any form on an electronic platform or electronic transmission system as shall be
approved by the Administrative Agent), appropriately completed and signed by a
Responsible Officer of the Borrower.

“Swing Line Sublimit” means, with respect to each Swing Line Lender, an amount
equal to the lesser of (a) the amount set forth on Schedule 1.01 with respect to
such Lender as its Swing Line Sublimit (as updated from time to time) and
(b) the Aggregate Commitments. The Swing Line Sublimits are part of, and not in
addition to, the Aggregate Commitments.

“Synthetic Debt” means, with respect to any Person as of any date of
determination thereof, all obligations of such Person in respect of transactions
entered into by such Person that are intended to function primarily as a
borrowing of funds (including any minority interest transactions that function
primarily as a borrowing) but are not otherwise included in the definition of
“Indebtedness” or as a liability on the consolidated balance sheet of such
Person and its Subsidiaries in accordance with GAAP.

“Synthetic Lease Obligation” means the monetary obligation of a Person under
(a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an
agreement for the use or possession of property (including sale and leaseback
transactions), in each case, creating obligations that do not appear on the
balance sheet of such Person but which, upon the application of any Debtor
Relief Laws to such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).

“Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings (including backup withholding), assessments, fees or other charges
imposed by any Governmental Authority, including any interest, additions to tax
or penalties applicable thereto.

“Term Loan Agent” means U.S. Bank National Association, as administrative agent
and collateral agent for those lenders party to the Term Loan Agreement,
together with its successors and assigns.

 

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“Term Loan Agreement” means that certain Amended and Restated Term Loan Credit
Agreement dated as of December 23, 2016, as amended and supplemented from time
to time, among the Borrower, U.S. Bank National Association, as administrative
agent, and each lender from time to time party thereto.

“Total Outstandings” means (a) the aggregate Outstanding Amount of all Loans
(including Protective Advances) and all L/C Obligations less (b) the amount of
L/C Obligations which are Cash Collateralized pursuant to Section 2.15(b).

“Total Swing Line Sublimit” means an amount equal to the lesser of (a)
$15,000,000 and (b) the Aggregate Commitments. The Total Swing Line Sublimit is
a part of, and not in addition to, the Aggregate Commitments.

“Treasury Management Control Agreement” means that certain Treasury Management
Services Security and Control Agreement dated as of September 14, 2016 between
Bank of America, N.A. and Basic Energy Services L.P., as may be amended,
modified or supplemented from time to time.

“Type” means, with respect to a Loan, its character as a Base Rate Loan or a
LIBOR Loan.

“UCC” means the Uniform Commercial Code as in effect in the State of New York;
provided that, if perfection or the effect of perfection or non-perfection or
the priority of any security interest in any Collateral is governed by the
Uniform Commercial Code as in effect in a jurisdiction other than the State of
New York, “UCC” means the Uniform Commercial Code as in effect from time to time
in such other jurisdiction for purposes of the provisions hereof relating to
such perfection, effect of perfection or non-perfection or priority.

“United States” and “U.S.” mean the United States of America.

“Unreimbursed Amount” has the meaning specified in Section 2.03(c)(i).

“Unrestricted Subsidiary” means any Subsidiary which the Borrower has designated
in writing to the Administrative Agent to be an Unrestricted Subsidiary pursuant
to Section 6.19(b) and each Subsidiary thereof.

“U.S. Loan Party” means any Loan Party that is organized under the laws of one
of the states of the United States of America and that is not a CFC.

“U.S. Person” means any Person that is a “United States person” as defined in
Section 7701(a)(30) of the Code.

“U.S. Tax Compliance Certificate” has the meaning specified in
Section 3.01(e)(ii).

“Value” means, for an Account, its face amount, net of any returns, rebates,
discounts (calculated on the shortest terms), credits, allowances or Taxes
(including sales, excise or other taxes) that have been or could properly be
claimed by the Account Debtor or any other Person.

 

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“Weekly BBC Trigger Period” means the period (a) commencing on the day that
(i) an Event of Default occurs, or (ii) Availability is less than the greater of
(x) 12.5% of the Borrowing Base or (y) $18,750,000 and (b) continuing until,
during each of the preceding 30 consecutive days, no Event of Default has
existed and Availability has at all times exceeded the greater of (i) 12.5% of
the Borrowing Base or (ii) $18,750,000.

“Write-Down and Conversion Powers” means, with respect to any EEA Resolution
Authority, the write-down and conversion powers of such EEA Resolution Authority
from time to time under the Bail-In Legislation for the applicable EEA Member
Country, which write-down and conversion powers are described in the EU Bail-In
Legislation Schedule.

1.02 Other Interpretive Provisions. With reference to this Agreement and each
other Loan Document, unless otherwise specified herein or in such other Loan
Document:

(a) 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,
(i) any definition of or reference to any agreement, instrument or other
document (including the Loan Documents and any Organization Document) shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, modified, extended, restated, replaced or supplemented
from time to time (subject to any restrictions on such amendments, supplements
or modifications set forth herein or in any other Loan Document), (ii) any
reference herein to any Person shall be construed to include such Person’s
successors and assigns, (iii) the words “hereto,” “herein,” “hereof” and
“hereunder,” and words of similar import when used in any Loan Document, shall
be construed to refer to such Loan Document in its entirety and not to any
particular provision thereof, (iv) all references in a Loan Document to
Articles, Sections, Preliminary Statements, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Preliminary Statements,
Exhibits and Schedules to, the Loan Document in which such references appear,
(v) any reference to any law shall include all statutory and regulatory rules,
regulations, orders and provisions consolidating, amending, replacing or
interpreting such law and any reference to any law or regulation shall, unless
otherwise specified, refer to such law or regulation as amended, modified,
extended, restated, replaced or supplemented from time to time, and (vi) the
words “asset” and “property” shall be construed to have the same meaning and
effect and to refer to any and all tangible and intangible assets and
properties, including cash, securities, accounts and contract rights.

(b) In the computation of periods of time from a specified date to a later
specified date, the word “from” means “from and including;” the words “to” and
“until” each mean “to but excluding;” and the word “through” means “to and
including.”

(c) Section headings herein and in the other Loan Documents are included for
convenience of reference only and shall not affect the interpretation of this
Agreement or any other Loan Document.

 

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1.03 Accounting Terms. (a) Generally. All accounting terms not specifically or
completely defined herein shall be construed in conformity with, and all
financial data (including financial ratios and other financial calculations)
required to be submitted pursuant to this Agreement shall be prepared in
conformity with, GAAP applied on a consistent basis, as in effect from time to
time, applied in a manner consistent with that used in preparing the Audited
Financial Statements, except as otherwise specifically prescribed herein.
Notwithstanding the foregoing, for purposes of determining compliance with any
covenant (including the computation of any financial covenant) contained herein,
Indebtedness of the Borrower and its Subsidiaries shall be deemed to be carried
at 100% of the outstanding principal amount thereof, and the effects of FASB ASC
825 and FASB ASC 470-20 on financial liabilities shall be disregarded.

(b) Changes in GAAP. If at any time any change in GAAP would affect the
computation of any financial ratio or requirement set forth in any Loan
Document, and either the Borrower or the Required Lenders shall so request, the
Administrative Agent, the Lenders and the Borrower shall negotiate in good faith
to amend such ratio or requirement to preserve the original intent thereof in
light of such change in GAAP (subject to the approval of the Required Lenders);
provided that, until so amended, (i) such ratio or requirement shall continue to
be computed in accordance with GAAP prior to such change therein and (ii) the
Borrower shall provide to the Administrative Agent and the Lenders financial
statements and other documents required under this Agreement or as reasonably
requested hereunder setting forth a reconciliation between calculations of such
ratio or requirement made before and after giving effect to such change in GAAP.
Without limiting the foregoing, leases shall continue to be classified and
accounted for on a basis consistent with that reflected in the Audited Financial
Statements for all purposes of this Agreement, notwithstanding any change in
GAAP relating thereto, unless the parties hereto shall enter into a mutually
acceptable amendment addressing such changes, as provided for above.

(c) Consolidation of Variable Interest Entities. All references herein to
consolidated financial statements of the Borrower and its Subsidiaries or to the
determination of any amount for the Borrower and its Subsidiaries on a
consolidated basis or any similar reference shall, in each case, be deemed to
include each variable interest entity that the Borrower is required to
consolidate pursuant to FASB ASC 810 as if such variable interest entity were a
Subsidiary as defined herein.

1.04 Rounding. Any financial ratios required to be maintained by the Borrower
pursuant to this Agreement shall be calculated by dividing the appropriate
component by the other component, carrying the result to one place more than the
number of places by which such ratio is expressed herein and rounding the result
up or down to the nearest number (with a rounding-up if there is no nearest
number).

1.05 Times of Day. Unless otherwise specified, all references herein to times of
day shall be references to Central time (daylight or standard, as applicable).

1.06 Letter of Credit Amounts. Unless otherwise specified herein, the amount of
a Letter of Credit at any time shall be deemed to be the stated amount of such
Letter of Credit in effect at such time; provided, however, that with respect to
any Letter of Credit that, by its terms or the terms of any Issuer Document
related thereto, provides for one or more automatic increases in the stated
amount thereof, the amount of such Letter of Credit shall be deemed to be the
maximum stated amount of such Letter of Credit after giving effect to all such
increases, whether or not such maximum stated amount is in effect at such time.

 

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1.07 Currency Equivalents Generally.

(a) Any amount specified in this Agreement (other than in Articles II and IX) or
any of the other Loan Documents to be in Dollars shall also include the
equivalent of such amount in any currency other than Dollars, such equivalent
amount thereof in the applicable currency to be determined by the Administrative
Agent at such time on the basis of the Spot Rate (as defined below) for the
purchase of such currency with Dollars. For purposes of this Section 1.07, the
“Spot Rate” for a currency means the rate determined by the Administrative Agent
to be the rate quoted by the Person acting in such capacity as the spot rate for
the purchase by such Person of such currency with another currency through its
principal foreign exchange trading office at approximately 10:00 a.m. on the
date two Business Days prior to the date of such determination; provided that
the Administrative Agent may obtain such spot rate from another financial
institution designated by the Administrative Agent if the Person acting in such
capacity does not have as of the date of determination a spot buying rate for
any such currency.

(b) The Administrative Agent does not warrant or accept responsibility for, nor
shall the Administrative Agent have any liability with respect to, the
administration, submission or any other matter related to any rate used in
determining LIBOR or with respect to any comparable or successor rate thereto.

1.08 Uniform Commercial Code. Terms relating to Collateral used and not
otherwise defined herein that are defined in the UCC shall have the meanings set
forth in the UCC, as applicable and as the context requires.

1.09 LIBOR Amendment. Notwithstanding anything to the contrary in this Agreement
or any other Loan Documents, if the Administrative Agent determines (which
determination shall be conclusive absent manifest error), or the Borrower or
Required Lenders notify the Administrative Agent (with, in the case of the
Required Lenders, a copy to the Borrower) that the Borrower or the Required
Lenders (as applicable) have determined, that:

(a) adequate and reasonable means do not exist for ascertaining LIBOR for any
applicable Interest Period, because the LIBOR quote on the applicable screen
page (or other source) used by the Administrative Agent to determine LIBOR
(“LIBOR Screen Rate”) is not available or published on a current basis and such
circumstances are unlikely to be temporary; or

(b) the administrator of the LIBOR Screen Rate or a Governmental Authority
having jurisdiction over the Administrative Agent has made a public statement
identifying a specific date (“Scheduled Unavailability Date”) after which LIBOR
or the LIBOR Screen Rate shall no longer be made available, or used for
determining the interest rate of loans; or

(c) syndicated loans currently being executed, or that include language similar
to that contained in this Section, are being executed or amended (as applicable)
to incorporate or adopt a new benchmark interest rate to replace LIBOR;

 

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then, reasonably promptly after such determination by the Administrative Agent
or receipt by the Administrative Agent of such notice, as applicable, the
Administrative Agent and the Borrower may amend this Agreement to replace LIBOR
with an alternate benchmark rate (including any mathematical or other
adjustments to the benchmark (if any) incorporated therein), giving due
consideration to any evolving or then existing convention for similar Dollar
denominated syndicated credit facilities for such alternative benchmarks (“LIBOR
Successor Rate”), together with any proposed LIBOR Successor Rate Conforming
Changes and the amendment shall be effective at 5:00 p.m. on the fifth Business
Day after the Administrative Agent posts the amendment to all Lenders and
Borrowers unless, prior to such time, the Required Lenders notify the
Administrative Agent that they do not accept the amendment.

If no LIBOR Successor Rate has been determined and the circumstances under
clause (a) above exist or the Scheduled Unavailability Date has occurred, the
Administrative Agent will promptly notify the Borrower and the Lenders.
Thereafter, (i) the obligation of Lenders to make or maintain LIBOR Loans shall
be suspended (to the extent of the affected LIBOR Loans or Interest Periods),
and (ii) the LIBOR component shall no longer be used in determining Base Rate.
Upon receipt of such notice, the Borrower may revoke any pending request for
funding, conversion or continuation of a LIBOR Loan (to the extent of the
affected LIBOR Loans or Interest Periods) or, failing that, will be deemed to
have requested a Base Rate Loan.

ARTICLE II

THE COMMITMENTS AND CREDIT EXTENSIONS

2.01 The Loans. Subject to the terms and conditions set forth herein, each
Lender severally agrees to make loans (each such loan, a “Revolving Credit
Loan”) to the Borrower from time to time, on any Business Day during the
Availability Period, in an aggregate amount not to exceed at any time
outstanding the amount of such Lender’s Commitment; provided, however, that
after giving effect to any Revolving Credit Borrowing, (i) the Total
Outstandings shall not exceed the Borrowing Base, and (ii) the aggregate
Outstanding Amount of the Revolving Credit Loans of any Lender, plus such
Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations,
plus such Lender’s Applicable Percentage of the Outstanding Amount of all Swing
Line Loans shall not exceed such Lender’s Commitment. Within the limits of the
Borrowing Base, and subject to the other terms and conditions hereof, the
Borrower may borrow under this Section 2.01, prepay under Section 2.05, and
reborrow under this Section 2.01. Revolving Credit Loans may be Base Rate Loans
or LIBOR Loans, as further provided herein; provided, however, any Revolving
Credit Borrowings made on the Closing Date or any of the three (3) Business Days
following the Closing Date shall be made as Base Rate Loans unless the Borrower
delivers a funding indemnity letter acceptable to the Administrative Agent not
less than three (3) Business Days prior to the date of such Revolving Credit
Borrowing.

2.02 Borrowings, Conversions and Continuations of Loans. (a) Each Revolving
Credit Borrowing, each conversion of Revolving Credit Loans from one Type to the
other, and each continuation of LIBOR Loans shall be made upon the Borrower’s
irrevocable notice to the Administrative Agent, which may be given by:
(i) telephone or (ii) a Revolving Credit Loan Notice. Each such notice must be
received by the Administrative Agent not later than 11:00 a.m. (i) three
Business Days prior to the requested date of any Borrowing of, conversion to or
continuation of LIBOR Loans or of any conversion of LIBOR Loans to Base Rate
Loans, and (ii)

 

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on the requested date of any Borrowing of Base Rate Loans. Each telephonic
notice by the Borrower pursuant to this Section 2.02(a) must be confirmed
promptly by delivery to the Administrative Agent of a written Revolving Credit
Loan Notice, appropriately completed and signed by a Responsible Officer of the
Borrower. Each Borrowing of, conversion to or continuation of LIBOR Loans shall
be in a principal amount of $5,000,000 or a whole multiple of $1,000,000 in
excess thereof. Except as provided in Sections 2.03(c) and 2.04(c), each
Borrowing of or conversion to Base Rate Loans shall be in a principal amount of
$500,000 or a whole multiple of $100,000 in excess thereof. Each Revolving
Credit Loan Notice and each telephonic notice shall specify (i) whether the
Borrower is requesting a Revolving Credit Borrowing, a conversion of Revolving
Credit Loans from one Type to the other, or a continuation of LIBOR Loans,
(ii) the requested date of the Borrowing, conversion or continuation, as the
case may be (which shall be a Business Day), (iii) the principal amount of Loans
to be borrowed, converted or continued, (iv) the Type of Loans to be borrowed or
to which existing Revolving Credit Loans are to be converted, and (v) if
applicable, the duration of the Interest Period with respect thereto. If the
Borrower fails to specify a Type of Loan in a Revolving Credit Loan Notice or if
the Borrower fails to give a timely notice requesting a conversion or
continuation, then the Revolving Credit Loans shall be made as, or converted to,
Base Rate Loans. Any such automatic conversion to Base Rate Loans shall be
effective as of the last day of the Interest Period then in effect with respect
to the applicable LIBOR Loans. If the Borrower requests a Borrowing of,
conversion to, or continuation of LIBOR Loans in any such Revolving Credit Loan
Notice, but fails to specify an Interest Period, it will be deemed to have
specified an Interest Period of one month. Notwithstanding anything to the
contrary herein, a Swing Line Loan may not be converted to a LIBOR Loan.

(b) Following receipt of a Revolving Credit Loan Notice, the Administrative
Agent shall promptly notify each Lender of the amount of its Applicable
Percentage of the Revolving Credit Loans, and if no timely notice of a
conversion or continuation is provided by the Borrower, the Administrative Agent
shall notify each Lender of the details of any automatic conversion to Base Rate
Loans described in Section 2.02(a). In the case of a Revolving Credit Borrowing,
each Lender shall make the amount of its Loan available to the Administrative
Agent in immediately available funds at the Administrative Agent’s Office not
later than 12:00 noon on the Business Day specified in the applicable Revolving
Credit Loan Notice. Upon satisfaction of the applicable conditions set forth in
Section 4.02 (and, if such Borrowing is the initial Credit Extension,
Section 4.01), the Administrative Agent shall make all funds so received
available to the Borrower in like funds as received by the Administrative Agent
either by (i) crediting the account of the Borrower on the books of Bank of
America with the amount of such funds or (ii) wire transfer of such funds, in
each case in accordance with instructions provided to (and reasonably acceptable
to) the Administrative Agent by the Borrower; provided, however, that if, on the
date a Revolving Credit Loan Notice with respect to a Revolving Credit Borrowing
is given by the Borrower, there are L/C Borrowings outstanding, then the
proceeds of such Revolving Credit Borrowing, first, shall be applied to the
payment in full of any such L/C Borrowings, and second, shall be made available
to the Borrower as provided above.

(c) Except as otherwise provided herein, a LIBOR Loan may be continued or
converted only on the last day of an Interest Period for such LIBOR Loan. During
the existence of a Default, no Loans may be requested as, converted to or
continued as LIBOR Loans without the consent of the Required Lenders.

 

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(d) The Administrative Agent shall promptly notify the Borrower and the Lenders
of the interest rate applicable to any Interest Period for LIBOR Loans upon
determination of such interest rate. At any time that Base Rate Loans are
outstanding, the Administrative Agent shall notify the Borrower and the Lenders
of any change in Bank of America’s prime rate used in determining the Base Rate
promptly following the public announcement of such change.

(e) After giving effect to all Revolving Credit Borrowings, all conversions of
Revolving Credit Loans from one Type to the other, and all continuations of
Revolving Credit Loans as the same Type, there shall not be more than five
(5) Interest Periods in effect with respect to LIBOR Loans.

2.03 Letters of Credit. (a) The Letter of Credit Commitment. (i) Subject to the
terms and conditions set forth herein, (A) each L/C Issuer agrees, in reliance
upon the agreements of the Lenders set forth in this Section 2.03, (1) from time
to time on any Business Day during the period from the Closing Date until the
Letter of Credit Expiration Date, to issue Letters of Credit for the account of
the Borrower or its Subsidiaries, and to amend or extend Letters of Credit
previously issued by it, in accordance with Section 2.03(b), and (2) to honor
drawings under the Letters of Credit; and (B) the Lenders severally agree to
participate in Letters of Credit issued for the account of the Borrower or its
Subsidiaries and any drawings thereunder; provided that after giving effect to
any L/C Credit Extension with respect to any Letter of Credit, (w) the Total
Outstandings shall not exceed the Borrowing Base, (x) the aggregate Outstanding
Amount of the Revolving Credit Loans of any Lender, plus such Lender’s
Applicable Percentage of the Outstanding Amount of all L/C Obligations, plus
such Lender’s Applicable Percentage of the Outstanding Amount of all Swing Line
Loans shall not exceed such Lender’s Commitment, (y) the Outstanding Amount of
the L/C Obligations shall not exceed the Letter of Credit Sublimit, and (z) the
aggregate amount of all outstanding Letters of Credit issued by any L/C Issuer
shall not exceed such L/C Issuer’s L/C Issuer Sublimit, except with respect to
the Existing Letters of Credit which shall be reallocated upon renewal or
extension pro rata among the respective L/C Issuers in accordance with the
definition of “L/C Issuer Sublimit” in Section 1.01 hereof so as to comply, to
the extent reasonably practicable, with this Section 2.03(a)(i); provided,
further, that upon each request of the Borrower after the Closing Date for the
issuance of a new Letter of Credit or for the amendment or extension of any
Letter of Credit first issued after the Closing Date (specifically excluding any
renewal or extension of any Existing Letter of Credit) (any such new Letter of
Credit or amendment or extension of a post-Closing Date Letter of Credit, a “New
Letter of Credit”), such New Letter of Credit shall be allocated to one or more
of the L/C Issuers, to the extent reasonably practicable, to maintain the
allocation of the New Letters of Credit, taken as a whole, among the L/C Issuers
in accordance with the definition of “L/C Issuer Sublimit” in Section 1.01
hereof. Each request by the Borrower for the issuance or amendment of a Letter
of Credit shall be deemed to be a representation by the Borrower that the L/C
Credit Extension so requested complies with the conditions set forth in the
proviso to the preceding sentence. Within the foregoing limits, and subject to
the terms and conditions hereof, the Borrower’s ability to obtain Letters of
Credit shall be fully revolving, and accordingly the Borrower may, during the
foregoing period, obtain Letters of Credit to replace Letters of Credit that
have expired or that have been drawn upon and reimbursed. All Existing Letters
of Credit shall be deemed to have been issued pursuant hereto and deemed L/C
Obligations, and from and after the Closing Date shall be subject to and
governed by the terms and conditions hereof.

 

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(ii) No L/C Issuer shall issue any Letter of Credit if:

(A) subject to Section 2.03(b)(iii), the expiry date of the requested Letter of
Credit would occur more than twelve months after the date of issuance or last
extension, unless the Required Lenders have approved such expiry date; or

(B) the expiry date of the requested Letter of Credit would occur after the
Letter of Credit Expiration Date, unless all the Lenders have approved such
expiry date.

(iii) No L/C Issuer shall be under any obligation to issue any Letter of Credit
if:

(A) any order, judgment or decree of any Governmental Authority or arbitrator
shall by its terms purport to enjoin or restrain the applicable L/C Issuer from
issuing the Letter of Credit, or any Law applicable to the applicable L/C Issuer
or any request or directive (whether or not having the force of law) from any
Governmental Authority with jurisdiction over such L/C Issuer shall prohibit, or
request that such L/C Issuer refrain from, the issuance of letters of credit
generally or the Letter of Credit in particular or shall impose upon the
applicable L/C Issuer with respect to the Letter of Credit any restriction,
reserve or capital requirement (for which such L/C Issuer is not otherwise
compensated hereunder) not in effect on the Closing Date, or shall impose upon
the applicable L/C Issuer any unreimbursed loss, cost or expense which was not
applicable on the Closing Date and which such L/C Issuer in good faith deems
material to it;

(B) the issuance of the Letter of Credit would violate one or more policies of
the applicable L/C Issuer applicable to letters of credit generally;

(C) except as otherwise agreed by the Administrative Agent and the applicable
L/C Issuer, the Letter of Credit is in an initial stated amount less than
$500,000;

(D) the Letter of Credit is to be denominated in a currency other than Dollars;

(E) any Lender is at that time a Defaulting Lender, unless the applicable L/C
Issuer has entered into arrangements, including the delivery of Cash Collateral,
satisfactory to such L/C Issuer (in its sole discretion) with the Borrower or
such Lender to eliminate such L/C Issuer’s actual or potential Fronting Exposure
(after giving effect to Section 2.16(a)(iv)) with respect to the Defaulting
Lender arising from either the Letter of Credit then proposed to be issued or
that Letter of Credit and all other L/C Obligations as to which such L/C Issuer
has actual or potential Fronting Exposure, as it may elect in its sole
discretion; or

(F) the Letter of Credit contains any provisions for automatic reinstatement of
the stated amount after any drawing thereunder.

 

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(iv) No L/C Issuer shall amend any Letter of Credit if such L/C Issuer would not
be permitted at such time to issue the Letter of Credit in its amended form
under the terms hereof.

(v) Each L/C Issuer shall be under no obligation to amend any Letter of Credit
if (A) such L/C Issuer would have no obligation at such time to issue the Letter
of Credit in its amended form under the terms hereof, or (B) the beneficiary of
the Letter of Credit does not accept the proposed amendment to the Letter of
Credit.

(vi) Each L/C Issuer shall act on behalf of the Lenders with respect to any
Letters of Credit issued by it and the documents associated therewith, and each
L/C Issuer shall have all of the benefits and immunities (A) provided to the
Administrative Agent in Article IX with respect to any acts taken or omissions
suffered by any L/C Issuer in connection with Letters of Credit issued by it or
proposed to be issued by it and Issuer Documents pertaining to such Letters of
Credit as fully as if the term “Administrative Agent” as used in Article IX
included the L/C Issuers with respect to such acts or omissions, and (B) as
additionally provided herein with respect to the L/C Issuers.

(b) Procedures for Issuance and Amendment of Letters of Credit; Auto-Extension
Letters of Credit. (i) Each Letter of Credit shall be issued or amended, as the
case may be, upon the request of the Borrower delivered to the applicable L/C
Issuer (with a copy to the Administrative Agent) in the form of a Letter of
Credit Application, appropriately completed and signed by a Responsible Officer
of the Borrower. Such Letter of Credit Application may be sent by fax
transmission, by United States mail, by overnight courier, by electronic
transmission using the system provided by the applicable L/C Issuer, by personal
delivery or by any other means acceptable to such L/C Issuer. Such Letter of
Credit Application must be received by the applicable L/C Issuer and the
Administrative Agent not later than 10:00 a.m. at least two Business Days (or
such later date and time as the Administrative Agent and the applicable L/C
Issuer may agree in a particular instance in their sole discretion) prior to the
proposed issuance date or date of amendment, as the case may be. In the case of
a request for an initial issuance of a Letter of Credit, such Letter of Credit
Application shall specify in form and detail satisfactory to the applicable L/C
Issuer: (A) the proposed issuance date of the requested Letter of Credit (which
shall be a Business Day); (B) the amount thereof; (C) the expiry date thereof;
(D) the name and address of the beneficiary thereof; (E) the documents to be
presented by such beneficiary in case of any drawing thereunder; (F) the full
text of any certificate to be presented by such beneficiary in case of any
drawing thereunder; (G) the purpose and nature of the requested Letter of
Credit; and (H) such other matters as the applicable L/C Issuer may reasonably
require. In the case of a request for an amendment of any outstanding Letter of
Credit, such Letter of Credit Application shall specify in form and detail
satisfactory to the applicable L/C Issuer (1) the Letter of Credit to be
amended; (2) the proposed date of amendment thereof (which shall be a Business
Day); (3) the nature of the proposed amendment; and (4) such other matters as
the applicable L/C Issuer may require. Additionally, the Borrower shall furnish
to the applicable L/C Issuer and the Administrative Agent such other documents
and information pertaining to such requested Letter of Credit issuance or
amendment, including any Issuer Documents, as such L/C Issuer or the
Administrative Agent may reasonably require.

 

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(ii) Promptly after receipt of any Letter of Credit Application, the applicable
L/C Issuer will confirm with the Administrative Agent (by telephone or in
writing) that the Administrative Agent has received a copy of such Letter of
Credit Application from the Borrower and, if not, such L/C Issuer will provide
the Administrative Agent with a copy thereof. Unless the applicable L/C Issuer
has received written notice from any Lender, the Administrative Agent or any
Loan Party, at least one Business Day prior to the requested date of issuance or
amendment of the applicable Letter of Credit, that one or more applicable
conditions contained in Article IV shall not then be satisfied, then, subject to
the terms and conditions hereof, such L/C Issuer shall, on the requested date,
issue a Letter of Credit for the account of the Borrower (or the applicable
Subsidiary) or enter into the applicable amendment, as the case may be, in each
case in accordance with such L/C Issuer’s usual and customary business
practices. Immediately upon the issuance of each Letter of Credit, each Lender
shall be deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from the applicable L/C Issuer a risk participation in such Letter of
Credit in an amount equal to the product of such Lender’s Applicable Percentage
times the amount of such Letter of Credit.

(iii) If the Borrower so requests in any applicable Letter of Credit
Application, the applicable L/C Issuer may, in its sole and absolute discretion,
agree to issue a Letter of Credit that has automatic extension provisions (each,
an “Auto-Extension Letter of Credit”); provided that any such Auto-Extension
Letter of Credit must permit such L/C Issuer to prevent any such extension at
least once in each twelve-month period (commencing with the date of issuance of
such Letter of Credit) by giving prior notice to the beneficiary thereof not
later than a day (the “Non-Extension Notice Date”) in each such twelve-month
period to be agreed upon at the time such Letter of Credit is issued. Unless
otherwise directed by the applicable L/C Issuer, the Borrower shall not be
required to make a specific request to such L/C Issuer for any such extension.
Once an Auto-Extension Letter of Credit has been issued, the Lenders shall be
deemed to have authorized (but may not require) the applicable L/C Issuer to
permit the extension of such Letter of Credit at any time to an expiry date not
later than the Letter of Credit Expiration Date; provided, however, that such
L/C Issuer shall not permit any such extension if (A) such L/C Issuer has
determined that it would not be permitted, or would have no obligation at such
time to issue such Letter of Credit in its revised form (as extended) under the
terms hereof (by reason of the provisions of clause (ii) or (iii) of
Section 2.03(a) or otherwise), or (B) it has received notice (which may be by
telephone or in writing) on or before the day that is seven Business Days before
the Non-Extension Notice Date (1) from the Administrative Agent that the
Required Lenders have elected not to permit such extension or (2) from the
Administrative Agent, any Lender or the Borrower that one or more of the
applicable conditions specified in Section 4.02 is not then satisfied, and in
each such case directing such L/C Issuer not to permit such extension.

(iv) Promptly after its delivery of any Letter of Credit or any amendment to a
Letter of Credit to an advising bank with respect thereto or to the beneficiary
thereof, the applicable L/C Issuer will also deliver to the Borrower and the
Administrative Agent a true and complete copy of such Letter of Credit or
amendment.

 

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(c) Drawings and Reimbursements; Funding of Participations. (i) Upon receipt
from the beneficiary of any Letter of Credit of any notice of a drawing under
such Letter of Credit, the applicable L/C Issuer shall notify the Borrower and
the Administrative Agent thereof. Not later than 10:00 a.m. on the date of any
payment by the applicable L/C Issuer under a Letter of Credit (each such date,
an “Honor Date”), the Borrower shall reimburse such L/C Issuer through the
Administrative Agent in an amount equal to the amount of such drawing. If the
Borrower fails to so reimburse the applicable L/C Issuer by such time, the
Administrative Agent shall promptly notify each Lender of the Honor Date, the
amount of the unreimbursed drawing (the “Unreimbursed Amount”), and the amount
of such Lender’s Applicable Percentage thereof. In such event, the Borrower
shall be deemed to have requested a Revolving Credit Borrowing of Base Rate
Loans to be disbursed on the Honor Date in an amount equal to the Unreimbursed
Amount, without regard to the minimum and multiples specified in Section 2.02
for the principal amount of Base Rate Loans, but subject to the amount of the
unutilized portion of the Commitments and the conditions set forth in
Section 4.02 (other than the delivery of a Revolving Credit Loan Notice). Any
notice given by the applicable L/C Issuer or the Administrative Agent pursuant
to this Section 2.03(c)(i) may be given by telephone if immediately confirmed in
writing; provided that the lack of such an immediate confirmation shall not
affect the conclusiveness or binding effect of such notice.

(ii) Each Lender shall upon any notice pursuant to Section 2.03(c)(i) make funds
available (and the Administrative Agent may apply Cash Collateral provided for
this purpose) for the account of the applicable L/C Issuer at the Administrative
Agent’s Office in an amount equal to its Applicable Percentage of the
Unreimbursed Amount not later than 12:00 noon on the Business Day specified in
such notice by the Administrative Agent, whereupon, subject to the provisions of
Section 2.03(c)(iii), each Lender that so makes funds available shall be deemed
to have made a Base Rate Loan to the Borrower in such amount. The Administrative
Agent shall remit the funds so received to such L/C Issuer.

(iii) With respect to any Unreimbursed Amount that is not fully refinanced by a
Revolving Credit Borrowing of Base Rate Loans because the conditions set forth
in Section 4.02 cannot be satisfied or for any other reason, the Borrower shall
be deemed to have incurred from the applicable L/C Issuer an L/C Borrowing in
the amount of the Unreimbursed Amount that is not so refinanced, which L/C
Borrowing shall be due and payable on demand (together with interest) and shall
bear interest at the Default Rate. In such event, each Lender’s payment to the
Administrative Agent for the account of such L/C Issuer pursuant to
Section 2.03(c)(ii) shall be deemed payment in respect of its participation in
such L/C Borrowing and shall constitute an L/C Advance from such Lender in
satisfaction of its participation obligation under this Section 2.03.

(iv) Until each Lender funds its Revolving Credit Loan or L/C Advance pursuant
to this Section 2.03(c) to reimburse the applicable L/C Issuer for any amount
drawn under any Letter of Credit, interest in respect of such Lender’s
Applicable Percentage of such amount shall be solely for the account of such L/C
Issuer.

 

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(v) Each Lender’s obligation to make Revolving Credit Loans or L/C Advances to
reimburse the applicable L/C Issuer for amounts drawn under Letters of Credit,
as contemplated by this Section 2.03(c), shall be absolute and unconditional and
shall not be affected by any circumstance, including (A) any setoff,
counterclaim, recoupment, defense or other right which such Lender may have
against such L/C Issuer, the Borrower or any other Person for any reason
whatsoever; (B) the occurrence or continuance of a Default, or (C) any other
occurrence, event or condition, whether or not similar to any of the foregoing;
provided, however, that each Lender’s obligation to make Revolving Credit Loans
pursuant to this Section 2.03(c) is subject to the conditions set forth in
Section 4.02 (other than delivery by the Borrower of a Revolving Credit Loan
Notice). No such making of an L/C Advance shall relieve or otherwise impair the
obligation of the Borrower to reimburse the applicable L/C Issuer for the amount
of any payment made by such L/C Issuer under any Letter of Credit, together with
interest as provided herein.

(vi) If any Lender fails to make available to the Administrative Agent for the
account of the applicable L/C Issuer any amount required to be paid by such
Lender pursuant to the foregoing provisions of this Section 2.03(c) by the time
specified in Section 2.03(c)(ii), then, without limiting the other provisions of
this Agreement, such L/C Issuer shall be entitled to recover from such Lender
(acting through the Administrative Agent), on demand, such amount with interest
thereon for the period from the date such payment is required to the date on
which such payment is immediately available to such L/C Issuer at a rate per
annum equal to the greater of the Federal Funds Rate and a rate determined by
such L/C Issuer in accordance with banking industry rules on interbank
compensation, plus any administrative, processing or similar fees customarily
charged by such L/C Issuer in connection with the foregoing. If such Lender pays
such amount (with interest and fees as aforesaid), the amount so paid shall
constitute such Lender’s Revolving Credit Loan included in the relevant
Revolving Credit Borrowing or L/C Advance in respect of the relevant L/C
Borrowing, as the case may be. A certificate of such L/C Issuer submitted to any
Lender (through the Administrative Agent) with respect to any amounts owing
under this Section 2.03(c)(vi) shall be conclusive absent manifest error.

(d) Repayment of Participations. (i) At any time after the applicable L/C Issuer
has made a payment under any Letter of Credit and has received from any Lender
such Lender’s L/C Advance in respect of such payment in accordance with
Section 2.03(c), if the Administrative Agent receives for the account of such
L/C Issuer any payment in respect of the related Unreimbursed Amount or interest
thereon (whether directly from the Borrower or otherwise, including proceeds of
Cash Collateral applied thereto by the Administrative Agent), the Administrative
Agent will distribute to such Lender its Applicable Percentage thereof in the
same funds as those received by the Administrative Agent.

(ii) If any payment received by the Administrative Agent for the account of the
applicable L/C Issuer pursuant to Section 2.03(c)(i) is required to be returned
under any of the circumstances described in Section 10.05 (including pursuant to
any settlement entered into by such L/C Issuer in its discretion), each Lender
shall pay to the Administrative Agent for the account of such L/C Issuer its
Applicable Percentage thereof on demand of the Administrative Agent, plus
interest thereon from the date of such demand to the date such amount is
returned by such Lender, at a rate per annum equal to the Federal Funds Rate
from time to time in effect. The obligations of the Lenders under this clause
shall survive the payment in full of the Obligations and the termination of this
Agreement.

 

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(e) Obligations Absolute. The obligation of the Borrower to reimburse each L/C
Issuer for each drawing under each Letter of Credit and to repay each L/C
Borrowing shall be absolute, unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement under all circumstances,
including the following:

(i) any lack of validity or enforceability of such Letter of Credit, this
Agreement, or any other Loan Document;

(ii) the existence of any claim, counterclaim, setoff, defense or other right
that the Borrower or any Subsidiary may have at any time against any beneficiary
or any transferee of such Letter of Credit (or any Person for whom any such
beneficiary or any such transferee may be acting), any L/C Issuer or any other
Person, whether in connection with this Agreement or such Letter of Credit, the
transactions contemplated hereby or any agreement or instrument relating
thereto, or any unrelated transaction;

(iii) any draft, demand, endorsement, certificate or other document presented
under or in connection with such Letter of Credit proving to be forged,
fraudulent, invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect; or any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under such Letter of Credit;

(iv) waiver by any L/C Issuer of any requirement that exists for such L/C
Issuer’s protection and not the protection of the Borrower or any waiver by any
L/C Issuer which does not in fact materially prejudice the Borrower;

(v) honor of a demand for payment presented electronically even if such Letter
of Credit requires that demand be in the form of a draft;

(vi) any payment made by any L/C Issuer in respect of an otherwise complying
item presented after the date specified as the expiration date of, or the date
by which documents must be received under, such Letter of Credit if presentation
after such date is authorized by the UCC or the ISP, as applicable;

(vii) any payment by any L/C Issuer under such Letter of Credit against
presentation of a draft or certificate that does not strictly comply with the
terms of such Letter of Credit; or any payment made by any L/C Issuer under such
Letter of Credit to any Person purporting to be a trustee in bankruptcy,
debtor-in-possession, assignee for the benefit of creditors, liquidator,
receiver or other representative of or successor to any beneficiary or any
transferee of such Letter of Credit, including any arising in connection with
any proceeding under any Debtor Relief Law; or

(viii) any other circumstance or happening whatsoever, whether or not similar to
any of the foregoing, including any other circumstance that might otherwise
constitute a defense available to, or a discharge of, the Borrower or any of its
Subsidiaries.

The Borrower shall promptly examine a copy of each Letter of Credit and each
amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with the Borrower’s instructions or other irregularity, the
Borrower will immediately notify the applicable L/C Issuer. The Borrower shall
be conclusively deemed to have waived any such claim against the applicable L/C
Issuer and its correspondents unless such notice is given as aforesaid.

 

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(f) Role of L/C Issuers. Each Lender and the Borrower agree that, in paying any
drawing under a Letter of Credit, no L/C Issuer shall have any responsibility to
obtain any document (other than any sight draft, certificates and documents
expressly required by the Letter of Credit) or to ascertain or inquire as to the
validity or accuracy of any such document or the authority of the Person
executing or delivering any such document. None of the L/C Issuer, the
Administrative Agent, any of their respective Related Parties nor any
correspondent, participant or assignee of the L/C Issuer shall be liable to any
Lender for (i) any action taken or omitted in connection herewith at the request
or with the approval of the Lenders or the Required Lenders, as applicable;
(ii) any action taken or omitted in the absence of gross negligence or willful
misconduct; or (iii) the due execution, effectiveness, validity or
enforceability of any document or instrument related to any Letter of Credit or
Issuer Document. The Borrower hereby assumes all risks of the acts or omissions
of any beneficiary or transferee with respect to its use of any Letter of
Credit; provided, however, that this assumption is not intended to, and shall
not, preclude the Borrower’s pursuing such rights and remedies as it may have
against the beneficiary or transferee at law or under any other agreement. None
of the L/C Issuers, the Administrative Agent, any of their respective Related
Parties nor any correspondent, participant or assignee of the L/C Issuers shall
be liable or responsible for any of the matters described in clauses (i) through
(viii) of Section 2.03(e); provided, however, that anything in such clauses to
the contrary notwithstanding, the Borrower may have a claim against any L/C
Issuer, and any L/C Issuer may be liable to the Borrower, to the extent, but
only to the extent, of any direct, as opposed to consequential or exemplary,
damages suffered by the Borrower which the Borrower proves, as determined by a
final nonappealable judgment of a court of competent jurisdiction, were caused
by such L/C Issuer’s willful misconduct or gross negligence or such L/C Issuer’s
willful failure to pay under any Letter of Credit after the presentation to it
by the beneficiary of a sight draft and certificate(s) strictly complying with
the terms and conditions of a Letter of Credit. In furtherance and not in
limitation of the foregoing, any L/C Issuer may accept documents that appear on
their face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary, and such L/C Issuer
shall not be responsible for the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign a Letter of Credit
or the rights or benefits thereunder or proceeds thereof, in whole or in part,
which may prove to be invalid or ineffective for any reason. Each L/C Issuer may
send a Letter of Credit or conduct any communication to or from the beneficiary
via the Society for Worldwide Interbank Financial Telecommunication (“SWIFT”)
message or overnight courier, or any other commercially reasonable means of
communicating with a beneficiary.

(g) Applicability of ISP. Unless otherwise expressly agreed by the applicable
L/C Issuer and the Borrower when a Letter of Credit is issued (including any
such agreement applicable to an Existing Letter of Credit), the rules of the ISP
shall apply to each Letter of Credit. Notwithstanding the foregoing, no L/C
Issuer shall be responsible to the Borrower for, and each L/C Issuer’s rights
and remedies against the Borrower shall not be impaired by, any action or
inaction of any L/C Issuer required or permitted under any law, order, or
practice that is required or permitted to be applied to any Letter of Credit or
this Agreement, including the Law or any order of a jurisdiction where such L/C
Issuer or the beneficiary is located, the practice stated in the ISP or in the
decisions, opinions, practice statements, or official commentary of the ICC
Banking Commission, the Bankers Association for Finance and Trade—International
Financial Services Association (BAFT-IFSA), or the Institute of International
Banking Law & Practice, whether or not any Letter of Credit chooses such law or
practice.

 

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(h) Letter of Credit Fees. The Borrower shall pay to the Administrative Agent
for the account of each Lender in accordance, subject to Section 2.16, with its
Applicable Percentage a Letter of Credit fee (the “Letter of Credit Fee”) for
each Letter of Credit equal to the Applicable Rate times the daily amount
available to be drawn under such Letter of Credit. For purposes of computing the
daily amount available to be drawn under any Letter of Credit, the amount of
such Letter of Credit shall be determined in accordance with Section 1.06.
Letter of Credit Fees shall be (i) due and payable on the first day of each
April, July, October and January, commencing with the first such date to occur
after the issuance of such Letter of Credit, on the Letter of Credit Expiration
Date and thereafter on demand and (ii) computed on a quarterly basis in arrears.
If there is any change in the Applicable Rate during any quarter, the daily
amount available to be drawn under each Letter of Credit shall be computed and
multiplied by the Applicable Rate separately for each period during such quarter
that such Applicable Rate was in effect. Notwithstanding anything to the
contrary contained herein, upon the request of the Administrative Agent or the
Required Lenders while any Event of Default exists (or automatically upon the
occurrence of an Event of Default under Section 8.01(a) or Section 8.01(f)), all
Letter of Credit Fees shall accrue at the Default Rate.

(i) Fronting Fee and Documentary and Processing Charges Payable to L/C Issuers.
The Borrower shall pay directly to the applicable L/C Issuer for its own account
a fronting fee with respect to each Letter of Credit, equal to 0.125% per annum
on the stated amount of each Letter of Credit issued by it, which fee shall be
payable upon the issuance of such Letter of Credit and at the time of each
renewal or extension of each Letter of Credit, computed on the daily amount
available to be drawn under such Letter of Credit on a quarterly basis in
arrears. Such fronting fee shall be due and payable on the tenth Business Day
after the end of each March, June, September and December in respect of the most
recently-ended quarterly period (or portion thereof, in the case of the first
payment), commencing with the first such date to occur after the issuance of
such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on
demand. For purposes of computing the daily amount available to be drawn under
any Letter of Credit, the amount of such Letter of Credit shall be determined in
accordance with Section 1.06. In addition, the Borrower shall pay directly to
the applicable L/C Issuer for its own account the customary issuance,
presentation, amendment and other processing fees, and other standard costs and
charges, of such L/C Issuer relating to letters of credit as from time to time
in effect. Such customary fees and standard costs and charges are due and
payable on demand and are nonrefundable.

(j) Conflict with Issuer Documents. In the event of any conflict between the
terms hereof and the terms of any Issuer Document, the terms hereof shall
control.

 

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(k) L/C Issuer Reports to the Administrative Agent. Unless otherwise agreed by
the Administrative Agent, each L/C Issuer shall, in addition to its notification
obligations set forth elsewhere in this Section, provide the Administrative
Agent a Letter of Credit Report, as set forth below:

(i) reasonably prior to the time that such L/C Issuer issues, amends, renews,
increases or extends a Letter of Credit, the date of such issuance, amendment,
renewal, increase or extension and the stated amount of the applicable Letters
of Credit after giving effect to such issuance, amendment, renewal or extension
(and whether the amounts thereof shall have changed);

(ii) on each Business Day on which such L/C Issuer makes a payment pursuant to a
Letter of Credit, the date and amount of such payment;

(iii) on any Business Day on which the Borrower fails to reimburse a payment
made pursuant to a Letter of Credit required to be reimbursed to such L/C Issuer
on such day, the date of such failure and the amount of such payment;

(iv) on any other Business Day, such other information as the Administrative
Agent shall reasonably request as to the Letters of Credit issued by such L/C
Issuer; and

(v) for so long as any Letter of Credit issued by an L/C Issuer is outstanding,
such L/C Issuer shall deliver to the Administrative Agent (A) on the last
Business Day of each calendar month, (B) at all other times a Letter of Credit
Report is required to be delivered pursuant to this Agreement, and (C) on each
date that (1) an L/C Credit Extension occurs or (2) there is any expiration,
cancellation and/or disbursement, in each case, with respect to any such Letter
of Credit, a Letter of Credit Report appropriately completed with the
information for every outstanding Letter of Credit issued by such L/C Issuer.

(l) Letters of Credit Issued for Subsidiaries. Notwithstanding that a Letter of
Credit issued or outstanding hereunder is in support of any obligations of, or
is for the account of, a Subsidiary, the Borrower shall be obligated to
reimburse the applicable L/C Issuer hereunder for any and all drawings under
such Letter of Credit. The Borrower hereby acknowledges that the issuance of
Letters of Credit for the account of Subsidiaries inures to the benefit of the
Borrower, and that the Borrower’s business derives substantial benefits from the
businesses of such Subsidiaries.

2.04 Swing Line Loans. (a) The Swing Line. Subject to the terms and conditions
set forth herein, each Swing Line Lender may in its sole discretion, in reliance
upon the agreements of the other Lenders set forth in this Section 2.04, make
loans (each such loan, a “Swing Line Loan”) to the Borrower from time to time on
any Business Day during the Availability Period in an aggregate amount not to
exceed at any time outstanding the amount of its Swing Line Sublimit,
notwithstanding the fact that such Swing Line Loans, when aggregated with the
Applicable Percentage of the Outstanding Amount of Revolving Credit Loans and
L/C Obligations of the Lender acting as Swing Line Lender, may exceed the amount
of such Lender’s Commitment; provided, however, that (i) after giving effect to
any Swing Line Loan, (A) the Total Outstandings shall not exceed the Borrowing
Base at such time, (B) the aggregate Outstanding Amount of the Revolving Credit
Loans of any Lender at such time, plus such Lender’s Applicable Percentage of
the Outstanding Amount of all L/C Obligations at such time, plus such Lender’s
Applicable Percentage of the Outstanding Amount of all Swing Line Loans at such
time shall not exceed such Lender’s Commitment and (C) the aggregate Outstanding
Amount of all Swing Line Loans at any time shall not exceed the Total Swing Line
Sublimit, and provided further that the Borrower shall

 

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not use the proceeds of any Swing Line Loan to refinance any outstanding Swing
Line Loan, (ii) no Swing Line Lender shall be under any obligation to make any
Swing Line Loan if it shall determine (which determination shall be conclusive
and binding absent manifest error) that it has, or by such Credit Extension may
have, Fronting Exposure and (iii) no Swing Line Lender shall make any Swing Line
Loan unless the conditions specified in Section 4.02 have been satisfied on and
as of the date the applicable Swing Line Loan is to be made. Within the
foregoing limits, and subject to the other terms and conditions hereof, the
Borrower may borrow under this Section 2.04, prepay under Section 2.05, and
reborrow under this Section 2.04. Each Swing Line Loan shall bear interest only
at a rate based on the Base Rate. Immediately upon the making of a Swing Line
Loan, each Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the applicable Swing Line Lender a risk participation
in such Swing Line Loan in an amount equal to the product of such Lender’s
Applicable Percentage times the amount of such Swing Line Loan.

(b) Borrowing Procedures. Each Swing Line Borrowing shall be made upon the
Borrower’s irrevocable notice to the applicable Swing Line Lender and the
Administrative Agent, which may be given by: (i) telephone or (ii) a Swing Line
Loan Notice. Each such notice must be received by the applicable Swing Line
Lender and the Administrative Agent not later than 12:00 noon on the requested
borrowing date, and shall specify (i) the amount to be borrowed, which shall be
a minimum of $100,000, and (ii) the requested borrowing date, which shall be a
Business Day. Each such telephonic notice must be confirmed promptly by delivery
to the applicable Swing Line Lender and the Administrative Agent of a written
Swing Line Loan Notice, appropriately completed and signed by a Responsible
Officer of the Borrower. Promptly after receipt by the applicable Swing Line
Lender of any telephonic Swing Line Loan Notice, the applicable Swing Line
Lender will confirm with the Administrative Agent (by telephone or in writing)
that the Administrative Agent has also received such Swing Line Loan Notice and,
if not, the applicable Swing Line Lender will notify the Administrative Agent
(by telephone or in writing) of the contents thereof. Unless the applicable
Swing Line Lender has received notice (by telephone or in writing) from the
Administrative Agent (including at the request of any Lender) prior to 1:00 p.m.
on the date of the proposed Swing Line Borrowing (A) directing such Swing Line
Lender not to make such Swing Line Loan as a result of the limitations set forth
in the first proviso to the first sentence of Section 2.04(a), or (B) that one
or more of the applicable conditions specified in Article IV is not then
satisfied, then, subject to the terms and conditions hereof, the applicable
Swing Line Lender will, not later than 2:00 p.m. on the borrowing date specified
in such Swing Line Loan Notice, make the amount of its Swing Line Loan available
to the Borrower.

(c) Refinancing of Swing Line Loans. (i) Each Swing Line Lender at any time in
its sole and absolute discretion may request, on behalf of the Borrower (which
hereby irrevocably authorizes each Swing Line Lender to so request on its
behalf), that each Lender make a Base Rate Loan in an amount equal to such
Lender’s Applicable Percentage of the amount of Swing Line Loans then
outstanding. Such request shall be made in writing (which written request shall
be deemed to be a Revolving Credit Loan Notice for purposes hereof) and in
accordance with the requirements of Section 2.02, without regard to the minimum
and multiples specified therein for the principal amount of Base Rate Loans, but
subject to the unutilized portion of the Aggregate Commitments and the
conditions set forth in Section 4.02. The applicable Swing Line Lender shall
furnish the Borrower with a copy of the applicable Revolving Credit Loan Notice
promptly after delivering such notice to the Administrative Agent. Each Lender
shall make an amount equal

 

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to its Applicable Percentage of the amount specified in such Revolving Credit
Loan Notice available to the Administrative Agent in immediately available funds
(and the Administrative Agent may apply Cash Collateral available with respect
to the applicable Swing Line Loan) for the account of the applicable Swing Line
Lender at the Administrative Agent’s Office not later than 12:00 noon on the day
specified in such Revolving Credit Loan Notice, whereupon, subject to
Section 2.04(c)(ii), each Lender that so makes funds available shall be deemed
to have made a Base Rate Loan to the Borrower in such amount. The Administrative
Agent shall remit the funds so received to the applicable Swing Line Lender.

(ii) If for any reason any Swing Line Loan cannot be refinanced by such a
Revolving Credit Borrowing in accordance with Section 2.04(c)(i), the request
for Base Rate Loans submitted by the applicable Swing Line Lender as set forth
herein shall be deemed to be a request by such Swing Line Lender that each of
the Lenders fund its risk participation in the relevant Swing Line Loan and each
Lender’s payment to the Administrative Agent for the account of the applicable
Swing Line Lender pursuant to Section 2.04(c)(i) shall be deemed payment in
respect of such participation.

(iii) If any Lender fails to make available to the Administrative Agent for the
account of the applicable Swing Line Lender any amount required to be paid by
such Lender pursuant to the foregoing provisions of this Section 2.04(c) by the
time specified in Section 2.04(c)(i), the applicable Swing Line Lender shall be
entitled to recover from such Lender (acting through the Administrative Agent),
on demand, such amount with interest thereon for the period from the date such
payment is required to the date on which such payment is immediately available
to the applicable Swing Line Lender at a rate per annum equal to the greater of
the Federal Funds Rate and a rate determined by the applicable Swing Line Lender
in accordance with banking industry rules on interbank compensation, plus any
administrative, processing or similar fees customarily charged by the applicable
Swing Line Lender in connection with the foregoing. If such Lender pays such
amount (with interest and fees as aforesaid), the amount so paid shall
constitute such Lender’s Revolving Credit Loan included in the relevant
Revolving Credit Borrowing or funded participation in the relevant Swing Line
Loan, as the case may be. A certificate of the applicable Swing Line Lender
submitted to any Lender (through the Administrative Agent) with respect to any
amounts owing under this clause (iii) shall be conclusive absent manifest error.

(iv) Each Lender’s obligation to make Revolving Credit Loans or to purchase and
fund risk participations in Swing Line Loans pursuant to this Section 2.04(c)
shall be absolute and unconditional and shall not be affected by any
circumstance, including (A) any setoff, counterclaim, recoupment, defense or
other right which such Lender may have against the applicable Swing Line Lender,
the Borrower or any other Person for any reason whatsoever, (B) the occurrence
or continuance of a Default, (C) the existence of an Overadvance or (D) any
other occurrence, event or condition, whether or not similar to any of the
foregoing; provided, however, that each Lender’s obligation to make Revolving
Credit Loans pursuant to this Section 2.04(c) is subject to the conditions set
forth in Section 4.02. No such funding of risk participations shall relieve or
otherwise impair the obligation of the Borrower to repay Swing Line Loans,
together with interest as provided herein.

 

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(d) Repayment of Participations. (i) At any time after any Lender has purchased
and funded a risk participation in a Swing Line Loan, if the applicable Swing
Line Lender receives any payment on account of such Swing Line Loan, such Swing
Line Lender will distribute to such Lender its Applicable Percentage thereof in
the same funds as those received by such Swing Line Lender.

(ii) If any payment received by the applicable Swing Line Lender in respect of
principal or interest on any Swing Line Loan is required to be returned by such
Swing Line Lender under any of the circumstances described in Section 10.05
(including pursuant to any settlement entered into by such Swing Line Lender in
its discretion), each Lender shall pay to the applicable Swing Line Lender its
Applicable Percentage thereof on demand of the Administrative Agent, plus
interest thereon from the date of such demand to the date such amount is
returned, at a rate per annum equal to the Federal Funds Rate. The
Administrative Agent will make such demand upon the request of the applicable
Swing Line Lender. The obligations of the Lenders under this clause shall
survive the payment in full of the Obligations and the termination of this
Agreement.

(e) Interest for Account of Swing Line Lender. Each Swing Line Lender shall be
responsible for invoicing the Borrower for interest on such Swing Line Lender’s
Swing Line Loans (provided that any failure of a Swing Line Lender to provide an
invoice for interest on Swing Line Loans shall not release the Borrower from its
obligation to pay such interest). Until each Lender funds its Base Rate Loan or
risk participation pursuant to this Section 2.04 to refinance such Lender’s
Applicable Percentage of any Swing Line Loan, interest in respect of such
Applicable Percentage shall be solely for the account of the applicable Swing
Line Lender.

(f) Payments Directly to Swing Line Lender. The Borrower shall make all payments
of principal and interest in respect of the Swing Line Loans directly to the
applicable Swing Line Lender.

2.05 Prepayments. (a) Optional. (i) The Borrower may, upon notice to the
Administrative Agent pursuant to delivery to the Administrative Agent of a
Notice of Loan Prepayment, at any time or from time to time voluntarily prepay
Revolving Credit Loans in whole or in part without premium or penalty subject to
Section 3.05; provided that (A) such notice must be received by the
Administrative Agent not later than 10:00 a.m. (1) three Business Days prior to
any date of prepayment of LIBOR Loans and (2) on the date of prepayment of Base
Rate Loans; (B) any prepayment of LIBOR Loans shall be in a principal amount of
$5,000,000 or a whole multiple of $1,000,000 in excess thereof; and (C) any
prepayment of Base Rate Loans shall be in a principal amount of $500,000 or a
whole multiple of $100,000 in excess thereof or, in each case, if less, the
entire principal amount thereof then outstanding. Each such notice shall specify
the date and amount of such prepayment and the Type(s) of Loans to be prepaid
and, if LIBOR Loans are to be prepaid, the Interest Period(s) of such Loans. The
Administrative Agent will promptly notify each Lender of its receipt of each
such notice, and of the amount of such Lender’s Applicable Percentage of such
prepayment. If such notice is given by the Borrower, the Borrower shall make
such prepayment and the payment amount specified in such notice shall be due and
payable on the date specified therein. Any prepayment of a LIBOR Loan shall be
accompanied by all accrued interest on the amount prepaid, together with any
additional amounts required pursuant to Section 3.05. Subject to Section 2.16,
each such prepayment shall be applied to the Revolving Credit Loans of the
Lenders in accordance with their respective Applicable Percentages.

 

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(ii) The Borrower may, upon notice to the applicable Swing Line Lender (with a
copy to the Administrative Agent), at any time or from time to time, voluntarily
prepay Swing Line Loans in whole or in part without premium or penalty; provided
that (A) such notice must be received by the applicable Swing Line Lender and
the Administrative Agent not later than 12:00 noon on the date of the
prepayment, and (B) any such prepayment shall be in a minimum principal amount
of $100,000. Each such notice shall specify the date and amount of such
prepayment. If such notice is given by the Borrower, the Borrower shall make
such prepayment and the payment amount specified in such notice shall be due and
payable on the date specified therein. Any prepayment of principal shall be
accompanied by all accrued interest on the amount prepaid.

(b) Mandatory. Subject to Section 2.18, if for any reason an Overadvance exists
at any time, the Borrower shall immediately prepay Revolving Credit Loans, Swing
Line Loans and L/C Borrowings and/or Cash Collateralize the L/C Obligations
(other than the L/C Borrowings) in an aggregate amount equal to such excess.

2.06 Termination or Reduction of Commitments. The Borrower may, upon notice to
the Administrative Agent, terminate the Aggregate Commitments, the Letter of
Credit Sublimit or the Total Swing Line Sublimit, or from time to time
permanently reduce the Aggregate Commitments, the Letter of Credit Sublimit or
the Total Swing Line Sublimit; provided that (i) any such notice shall be
received by the Administrative Agent not later than 10:00 a.m. five Business
Days prior to the date of termination or reduction, (ii) any such partial
reduction shall be in an aggregate amount of $10,000,000 or any whole multiple
of $1,000,000 in excess thereof and (iii) the Borrower shall not terminate or
reduce (A) the Aggregate Commitments if, after giving effect thereto and to any
concurrent prepayments hereunder, the Total Outstandings would exceed the
Borrowing Base, (B) the Letter of Credit Sublimit if, after giving effect
thereto, the Outstanding Amount of L/C Obligations not fully Cash Collateralized
hereunder would exceed the Letter of Credit Sublimit, or (C) the Total Swing
Line Sublimit if, after giving effect thereto and to any concurrent prepayments
hereunder, the Outstanding Amount of Swing Line Loans would exceed the Total
Swing Line Sublimit or the Outstanding Amount of Swing Line Loans owing to any
Swing Line Lender would exceed such Swing Line Lender’s Swing Line Sublimit. The
Administrative Agent will promptly notify the Lenders of any termination or
reduction of the Letter of Credit Sublimit, Swing Line Sublimit or the Aggregate
Commitments under this Section 2.06. Upon any reduction of the Aggregate
Commitments, the Commitment of each Lender shall be reduced by such Lender’s
Applicable Percentage of such reduction amount. Upon any reduction of the Total
Swing Line Sublimit, each Swing Line Lender’s Swing Line Sublimit shall be
reduced pro rata by an amount equal to such reduction amount. All fees accrued
until the effective date of any termination of the Aggregate Commitments shall
be paid on the effective date of such termination.

2.07 Repayment of Loans. (a) Revolving Credit Loans. The Borrower shall repay to
the Lenders on the Maturity Date the aggregate principal amount of all Revolving
Credit Loans outstanding on such date.

 

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(b) Swing Line Loans. The Borrower shall repay each Swing Line Loan on the
earlier to occur of (i) the date ten (10) Business Days after such Loan is made
and (ii) the Maturity Date.

(c) Protective Advances. The Borrower shall repay each Protective Advance on the
earlier to occur of (i) written demand therefor by the Administrative Agent and
(ii) the Maturity Date.

(d) Dominion Account. During any Cash Dominion Trigger Period if the
Administrative Agent elects to implement cash dominion, the ledger balance in
each Dominion Account as of the end of a Business Day shall be applied to the
Obligations at the beginning of the next Business Day. If a credit balance
results from such application, it shall not accrue interest in favor of the Loan
Parties and shall be made available to the Borrower as long as no Default or
Event of Default exists. At all times when a Cash Dominion Trigger Period is not
in effect, Borrower shall have unrestricted access to amounts in Deposit
Accounts.

2.08 Interest. (a) Subject to the provisions of Section 2.08(b), (i) each LIBOR
Loan shall bear interest on the outstanding principal amount thereof for each
Interest Period at a rate per annum equal to LIBOR for such Interest Period plus
the Applicable Rate; (ii) each Base Rate Loan shall bear interest on the
outstanding principal amount thereof from the applicable borrowing date at a
rate per annum equal to the Base Rate plus the Applicable Rate; and (iii) each
Swing Line Loan shall bear interest on the outstanding principal amount thereof
from the applicable borrowing date at a rate per annum equal to the Base Rate
plus the Applicable Rate.

(b) (i) If any amount of principal of any Loan is not paid when due (without
regard to any applicable grace periods), whether at stated maturity, by
acceleration or otherwise, such amount shall thereafter bear interest at a
fluctuating interest rate per annum at all times equal to the Default Rate to
the fullest extent permitted by applicable Laws.

(ii) If any amount (other than principal of any Loan) payable by the Borrower
under any Loan Document is not paid when due (without regard to any applicable
grace periods), whether at stated maturity, by acceleration or otherwise, then
upon the request of the Administrative Agent or the Required Lenders such amount
shall thereafter bear interest at a fluctuating interest rate per annum at all
times equal to the Default Rate to the fullest extent permitted by applicable
Laws.

(iii) Upon the request of the Administrative Agent or the Required Lenders,
while any Event of Default exists or automatically upon the occurrence of an
Event of Default under Section 8.01(a) or Section 8.01(f), the Borrower shall
pay interest on the principal amount of all outstanding Obligations hereunder at
a fluctuating interest rate per annum at all times equal to the Default Rate to
the fullest extent permitted by applicable Laws.

(iv) Accrued and unpaid interest on past due amounts (including interest on past
due interest) shall be due and payable upon demand.

(c) Interest on each Loan shall be due and payable in arrears on each Interest
Payment Date applicable thereto and at such other times as may be specified
herein. Interest hereunder shall be due and payable in accordance with the terms
hereof before and after judgment, and before and after the commencement of any
proceeding under any Debtor Relief Law.

 

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2.09 Fees. In addition to certain fees described in Sections 2.03(h) and (i):

(a) Commitment Fee. The Borrower shall pay to the Administrative Agent for the
account of each Lender in accordance with its Applicable Percentage, a
commitment fee equal to the Applicable Fee Rate times the actual daily amount by
which the Aggregate Commitments exceed the Revolving Credit Usage, subject to
adjustment as provided in Section 2.16. The commitment fee shall accrue at all
times during the Availability Period, including at any time during which one or
more of the conditions in Article IV is not met, and shall be due and payable
quarterly in arrears on the first day of each April, July, October and January,
commencing with the first such date to occur after the Closing Date, and on the
last day of the Availability Period. The commitment fee shall be calculated
quarterly in arrears, and if there is any change in the Applicable Fee Rate
during any quarter, the actual daily amount shall be computed and multiplied by
the Applicable Fee Rate separately for each period during such quarter that such
Applicable Fee Rate was in effect.

(b) Other Fees. (i) The Borrower shall pay to MLPFS and the Administrative Agent
for their own respective accounts fees in the amounts and at the times specified
in the Fee Letter. Such fees shall be fully earned when paid and shall not be
refundable for any reason whatsoever.

(ii) The Borrower shall pay to the Administrative Agent for the benefit of the
Lenders such fees as shall have been separately agreed upon in the Fee Letter.
Such fees shall be fully earned when paid and shall not be refundable for any
reason whatsoever.

2.10 Computation of Interest and Fees. (a) All computations of interest for Base
Rate Loans (excluding Base Rate Loans determined by reference to LIBOR) shall be
made on the basis of a year of 365 or 366 days, as the case may be, and actual
days elapsed. All other computations of fees and interest shall be made on the
basis of a 360-day year and actual days elapsed (which results in more fees or
interest, as applicable, being paid than if computed on the basis of a 365-day
year). Interest shall accrue on each Loan for the day on which the Loan is made,
and shall not accrue on a Loan, or any portion thereof, for the day on which the
Loan or such portion is paid, provided that any Loan that is repaid on the same
day on which it is made shall, subject to Section 2.12(a), bear interest for one
day. Each determination by the Administrative Agent of an interest rate or fee
hereunder shall be conclusive and binding for all purposes, absent manifest
error.

2.11 Evidence of Debt. (a) The Credit Extensions made by each Lender shall be
evidenced by one or more accounts or records maintained by such Lender and by
the Administrative Agent in the ordinary course of business. The accounts or
records maintained by the Administrative Agent and each Lender shall be
conclusive absent manifest error of the amount of the Credit Extensions made by
the Lenders to the Borrower and the interest and payments thereon. Any failure
to so record or any error in doing so shall not, however, limit or otherwise
affect the obligation of the Borrower hereunder to pay any amount owing with
respect to the Obligations. In the event of any conflict between the accounts
and records maintained by any Lender and the accounts and records of the
Administrative Agent in respect of such matters, the accounts and records of the
Administrative Agent shall control in the absence of manifest error.

 

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Upon the request of any Lender made through the Administrative Agent, the
Borrower shall execute and deliver to such Lender (through the Administrative
Agent) a Note, which shall evidence such Lender’s Loans in addition to such
accounts or records. Each Lender may attach schedules to its Note and endorse
thereon the date, Type (if applicable), amount and maturity of its Loans and
payments with respect thereto.

(b) In addition to the accounts and records referred to in Section 2.11(a), each
Lender and the Administrative Agent shall maintain in accordance with its usual
practice accounts or records evidencing the purchases and sales by such Lender
of participations in Letters of Credit and Swing Line Loans. In the event of any
conflict between the accounts and records maintained by the Administrative Agent
and the accounts and records of any Lender in respect of such matters, the
accounts and records of the Administrative Agent shall control in the absence of
manifest error.

2.12 Payments Generally; Administrative Agent’s Clawback. (a) General. All
payments to be made by the Borrower shall be made free and clear and without
condition or deduction for any counterclaim, defense, recoupment or setoff.
Except as otherwise expressly provided herein, all payments by the Borrower
hereunder shall be made to the Administrative Agent, for the account of the
respective Lenders to which such payment is owed, at the Administrative Agent’s
Office in Dollars and in immediately available funds not later than 1:00 p.m. on
the date specified herein. The Administrative Agent will promptly distribute to
each Lender its Applicable Percentage (or other applicable share as provided
herein) of such payment in like funds as received by wire transfer to such
Lender’s Lending Office. All payments received by the Administrative Agent after
1:00 p.m. shall be deemed received on the next succeeding Business Day and any
applicable interest or fee shall continue to accrue. If any payment to be made
by the Borrower shall come due on a day other than a Business Day, payment shall
be made on the next following Business Day, and such extension of time shall be
reflected on computing interest or fees, as the case may be.

(b) (i) Funding by Lenders; Presumption by Administrative Agent. Unless the
Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Borrowing of LIBOR Loans (or, in the case of any Borrowing
of Base Rate Loans, prior to 12:00 p.m. (noon) on the date of such Borrowing)
that such Lender will not make available to the Administrative Agent such
Lender’s share of such Borrowing, the Administrative Agent may assume that such
Lender has made such share available on such date in accordance with
Section 2.02 (or, in the case of a Borrowing of Base Rate Loans, that such
Lender has made such share available in accordance with and at the time required
by Section 2.02) and may, in reliance upon such assumption, make available to
the Borrower a corresponding amount. In such event, if a Lender has not in fact
made its share of the applicable Borrowing available to the Administrative
Agent, then the applicable Lender and the Borrower severally agree to pay to the
Administrative Agent forthwith on demand such corresponding amount in
immediately available funds with interest thereon, for each day from and
including the date such amount is made available to the Borrower to but
excluding the date of payment to the Administrative Agent, at (A) in the case of
a payment to be made by such Lender, the greater of the Federal Funds Rate and a
rate determined by the Administrative Agent in accordance with banking industry
rules on interbank compensation, plus any administrative, processing or similar
fees customarily charged by the Administrative Agent in connection with the
foregoing, and (B) in the case of a payment to be made by the Borrower, the
interest rate applicable to Base Rate Loans. If the Borrower and such Lender
shall

 

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pay such interest to the Administrative Agent for the same or an overlapping
period, the Administrative Agent shall promptly remit to the Borrower the amount
of such interest paid by the Borrower for such period. If such Lender pays its
share of the applicable Borrowing to the Administrative Agent, then the amount
so paid shall constitute such Lender’s Loan included in such Borrowing. Any
payment by the Borrower shall be without prejudice to any claim the Borrower may
have against a Lender that shall have failed to make such payment to the
Administrative Agent.

(ii) Payments by Borrower; Presumptions by Administrative Agent. Unless the
Administrative Agent shall have received notice from the Borrower prior to the
time at which any payment is due to the Administrative Agent for the account of
the Lenders or the L/C Issuers hereunder that the Borrower will not make such
payment, the Administrative Agent may assume that the Borrower has made such
payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the Lenders or the L/C Issuers, as the case may be,
the amount due. In such event, if the Borrower has not in fact made such
payment, then each of the Lenders or the L/C Issuers, as the case may be,
severally agrees to repay to the Administrative Agent forthwith on demand the
amount so distributed to such Lender or such L/C Issuer, in immediately
available funds with interest thereon, for each day from and including the date
such amount is distributed to it to but excluding the date of payment to the
Administrative Agent, at the greater of the Federal Funds Rate and a rate
determined by the Administrative Agent in accordance with banking industry rules
on interbank compensation.

A notice of the Administrative Agent to any Lender or the Borrower with respect
to any amount owing under this subsection (b) shall be conclusive, absent
manifest error.

(c) Failure to Satisfy Conditions Precedent. If any Lender makes available to
the Administrative Agent funds for any Loan to be made by such Lender as
provided in the foregoing provisions of this Article II, and such funds are not
made available to the Borrower by the Administrative Agent because the
conditions to the applicable Credit Extension set forth in Article IV are not
satisfied or waived in accordance with the terms hereof, the Administrative
Agent shall return such funds (in like funds as received from such Lender) to
such Lender, without interest.

(d) Obligations of Lenders Several. The obligations of the Lenders hereunder to
make Revolving Credit Loans, to fund participations in Letters of Credit and
Swing Line Loans and to make payments pursuant to Section 10.04(c) are several
and not joint. The failure of any Lender to make any Loan, to fund any such
participation or to make any payment under Section 10.04(c) on any date required
hereunder shall not relieve any other Lender of its corresponding obligation to
do so on such date, and no Lender shall be responsible for the failure of any
other Lender to so make its Loan, to purchase its participation or to make its
payment under Section 10.04(c).

(e) Funding Source. Nothing herein shall be deemed to obligate any Lender to
obtain the funds for any Loan in any particular place or manner or to constitute
a representation by any Lender that it has obtained or will obtain the funds for
any Loan in any particular place or manner.

 

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(f) Insufficient Funds. If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal, L/C
Borrowings, interest and fees then due hereunder, such funds shall be applied
(i) first, toward payment of interest and fees then due hereunder, ratably among
the parties entitled thereto in accordance with the amounts of interest and fees
then due to such parties, and (ii) second, toward payment of principal and L/C
Borrowings then due hereunder, ratably among the parties entitled thereto in
accordance with the amounts of principal and L/C Borrowings then due to such
parties.

2.13 Sharing of Payments by Lenders. If any Lender shall, by exercising any
right of setoff or counterclaim or otherwise, obtain payment in respect of
(a) Obligations due and payable to such Lender hereunder and under the other
Loan Documents at such time in excess of its ratable share (according to the
proportion of (i) the amount of such Obligations due and payable to such Lender
at such time to (ii) the aggregate amount of the Obligations due and payable to
all Lenders hereunder and under the other Loan Documents at such time) of
payments on account of the Obligations due and payable to all Lenders hereunder
and under the other Loan Documents at such time obtained by all the Lenders at
such time or (b) Obligations owing (but not due and payable) to such Lender
hereunder and under the other Loan Documents at such time in excess of its
ratable share (according to the proportion of (i) the amount of such Obligations
owing (but not due and payable) to such Lender at such time to (ii) the
aggregate amount of the Obligations owing (but not due and payable) to all
Lenders hereunder and under the other Loan Parties at such time) of payment on
account of the Obligations owing (but not due and payable) to all Lenders
hereunder and under the other Loan Documents at such time obtained by all of the
Lenders at such time then, in each case under clause (a) and (b) above, the
Lender receiving such greater proportion shall (a) notify the Administrative
Agent of such fact, and (b) purchase (for cash at face value) participations in
the Revolving Credit Loans and subparticipations in L/C Obligations and Swing
Line Loans of the other Lenders, or make such other adjustments as shall be
equitable, so that the benefit of all such payments shall be shared by the
Lenders ratably in accordance with the aggregate amount of Obligations then due
and payable to the Lenders or owing (but not due and payable) to the Lenders, as
the case may be, provided that:

(i) if any such participations or subparticipations are purchased and all or any
portion of the payment giving rise thereto is recovered, such participations or
subparticipations shall be rescinded and the purchase price restored to the
extent of such recovery, without interest; and

(ii) the provisions of this Section shall not be construed to apply to (A) any
payment made by or on behalf of the Borrower pursuant to and in accordance with
the express terms of this Agreement (including the application of funds arising
from the existence of a Defaulting Lender), (B) the application of Cash
Collateral provided for in Section 2.15, or (C) any payment obtained by a Lender
as consideration for the assignment of or sale of a participation in any of its
Loans or subparticipations in L/C Obligations or Swing Line Loans to any
assignee or participant, other than an assignment to the Borrower or any
Subsidiary or Affiliate thereof (as to which the provisions of this Section
shall apply).

The Borrower consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against the
Borrower rights of setoff and counterclaim with respect to such participation as
fully as if such Lender were a direct creditor of the Borrower in the amount of
such participation.

 

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2.14 Increase in Commitments.

(a) Request for Increase. Provided there exists no Default, upon notice to the
Administrative Agent (which shall promptly notify the Lenders), the Borrower may
from time to time request an increase in the Aggregate Commitments to an amount
up to but not exceeding (giving effect to all such increases) $50,000,000;
provided that (i) any such request for an increase shall be in a minimum amount
of $10,000,000 (or such lesser amount that permits compliance with
Section 2.14(e)(iv) and (ii) the Borrower may make a maximum of five (5) such
requests. At the time of sending such notice, the Borrower (in consultation with
the Administrative Agent) shall specify the time period within which each Lender
is requested to respond (which shall in no event be less than ten Business Days
from the date of delivery of such notice to the Lenders).

(b) Lender Elections to Increase. Each Lender shall notify the Administrative
Agent within such time period whether or not it agrees to increase its
Commitment and, if so, whether by an amount equal to, greater than, or less than
its Applicable Percentage of such requested increase. Any Lender not responding
within such time period shall be deemed to have declined to increase its
Commitment.

(c) Notification by Administrative Agent; Additional Lenders. The Administrative
Agent shall notify the Borrower and each Lender of the Lenders’ responses to
each request made hereunder. Subject to the approval of the Administrative
Agent, the L/C Issuers and the Swing Line Lenders (which approvals shall not be
unreasonably withheld), the Borrower may also invite additional Eligible
Assignees to become Lenders pursuant to a joinder agreement in form and
substance satisfactory to the Administrative Agent and its counsel, which
invitation may be made concurrently with the notice required by Section 2.14(a).

(d) Effective Date and Allocations. If the Aggregate Commitments are increased
in accordance with this Section, the Administrative Agent and the Borrower shall
determine the effective date (the “Revolving Credit Increase Effective Date”)
and the final allocation of such increase. The Administrative Agent shall
promptly notify the Borrower and the Lenders of the final allocation of such
increase and the Revolving Credit Increase Effective Date.

(e) Conditions to Effectiveness of Increase. Any such increase shall be subject
to the following additional conditions: (i) the Borrower shall deliver to the
Administrative Agent a certificate of each Loan Party dated as of the Revolving
Credit Increase Effective Date (in sufficient copies for each Lender) signed by
a Responsible Officer of such Loan Party (x) certifying and attaching the
resolutions adopted by such Loan Party approving or consenting to such increase,
and (y) in the case of the Borrower, certifying that, before and after giving
effect to such increase, (A) the representations and warranties contained in
Article V and the other Loan Documents are true and correct on and as of the
Revolving Credit Increase Effective Date, except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they are true and correct as of such earlier date, and except that for
purposes of this Section 2.14, the representations and warranties contained in
subsections (a) and (b) of Section 5.05 shall be deemed to refer to the most
recent statements furnished pursuant to clauses (a) and (b),

 

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respectively, of Section 6.01, and (B) no Default or Event of Default shall have
occurred and be continuing as of the date of such notice given in accordance
with Section 2.14(a) and both immediately before and after giving effect thereto
as of the Revolving Credit Increase Effective Date; (ii) the increase in
Aggregate Commitments shall be on the same terms and conditions as this
Agreement (except with respect to upfront or similar fees payable to the Lenders
providing such increase and arrangement fees), including benefiting from the
same guarantees and secured by the same liens and Collateral; (iii) the increase
in Aggregate Commitments, to the extent arising from the admission of an
Eligible Assignee as a Lender, shall be effected pursuant to one or more joinder
agreements executed and delivered by the Borrower, the new Lender(s) and the
Administrative Agent, each of which shall be in form and substance reasonably
satisfactory to the Agent; (iv) neither the funding of such increase (assuming
that the Aggregate Commitments as so increased are fully drawn) nor the
existence of the Liens securing the same would exceed 95% of any applicable
limitation under the Senior Notes Indenture or any other agreement governing
material Indebtedness for borrowed money of the Borrower and its Subsidiaries;
(v) the Borrower shall pay all reasonable and documented fees and expenses in
connection with the increase in Aggregate Commitments, including payments
required pursuant to Section 3.05 in connection with the increase; and (vi) the
Borrower shall have delivered all customary agreements, certificates, opinions
and other customary documents reasonably requested by the Administrative Agent
in connection with such increase. Borrower shall prepay any Revolving Credit
Loans outstanding on the Revolving Credit Increase Effective Date (and pay any
additional amounts required pursuant to Section 3.05) to the extent necessary to
keep the outstanding Revolving Credit Loans ratable with any revised Applicable
Percentages arising from any nonratable increase in the Commitments under this
Section, and Borrower may use advances from Lenders having new or increased
Commitments for such prepayment.

(f) Conflicting Provisions. This Section shall supersede any provisions in
Section 2.13 or 10.01 to the contrary.

2.15 Cash Collateral.

(a) Certain Credit Support Events. Upon the request of the Administrative Agent
or any L/C Issuer (i) if the applicable L/C Issuer has honored any full or
partial drawing request under any Letter of Credit and such drawing has resulted
in an L/C Borrowing, or (ii) if, as of the Letter of Credit Expiration Date, any
L/C Obligation for any reason remains outstanding, the Borrower shall, in each
case, immediately Cash Collateralize the then Outstanding Amount of all L/C
Obligations. At any time that there shall exist a Defaulting Lender, immediately
upon the request of the Administrative Agent, the L/C Issuers or the Swing Line
Lenders, the Borrower shall deliver to the Administrative Agent Cash Collateral
in an amount not less than the applicable Minimum Collateral Amount (determined
in the case of Cash Collateral provided pursuant to clause (ii) above, after
giving effect to Section 2.16(a)(iv) and any Cash Collateral provided by the
Defaulting Lender).

(b) Voluntary Cash Collateralization of Letters of Credit. Upon prior notice to
the Administrative Agent and any L/C Issuer, Borrower or any other Loan Party
may, in its discretion and at any time, Cash Collateralize all or a portion of
the Outstanding Amount of L/C Obligations.

 

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(c) Grant of Security Interest. All Cash Collateral (other than credit support
not constituting funds subject to deposit) shall be maintained in blocked
deposit accounts at Bank of America which, in the case of Cash Collateral
provided by any Loan Party, shall be interest bearing deposit accounts. The
Borrower shall pay on demand therefor from time to time all customary account
opening, activity and other administrative fees and charges in connection with
the maintenance and disbursement of Cash Collateral. The Borrower, and to the
extent provided by any Lender, such Lender, hereby grants to (and subjects to
the control of) the Administrative Agent, for the benefit of the Administrative
Agent, the L/C Issuers and the Lenders (including the Swing Line Lenders), and
agrees to maintain, a first priority security interest in all such cash, deposit
accounts and all balances therein, and all other property so provided as
collateral pursuant hereto, and in all proceeds of the foregoing, all as
security for the obligations to which such Cash Collateral may be applied
pursuant to Section 2.15(d). If at any time the Administrative Agent determines
that Cash Collateral is subject to any right or claim of any Person other than
the Administrative Agent as herein provided, or that the total amount of such
Cash Collateral is less than the Minimum Collateral Amount, the Borrower or the
relevant Defaulting Lender will, promptly upon demand by the Administrative
Agent, pay or provide to the Administrative Agent additional Cash Collateral in
an amount sufficient to eliminate such deficiency.

(d) Application. Notwithstanding anything to the contrary contained in this
Agreement, Cash Collateral provided under any of this Section 2.15 or
Sections 2.03, 2.04, 2.05, 2.06, 2.16 or 8.02 in respect of Letters of Credit or
Swing Line Loans shall be held and applied to the satisfaction of the specific
L/C Obligations, Swing Line Loans, obligations to fund participations therein
(including, as to Cash Collateral provided by a Defaulting Lender, any interest
accrued on such obligation) and other obligations for which the Cash Collateral
was so provided, prior to any other application of such property as may be
provided for herein.

(e) Release. Cash Collateral (or the appropriate portion thereof) provided to
reduce Fronting Exposure or to secure other obligations shall be released
promptly following (i) the elimination of the applicable Fronting Exposure or
other obligations giving rise thereto (including by the termination of
Defaulting Lender status of the applicable Lender (or, as appropriate, its
assignee following compliance with Section 10.06(b)(vi))), or (ii) the
Administrative Agent’s good faith determination that there exists excess Cash
Collateral; provided, however, (w) any such release shall be without prejudice
to, and any disbursement or other transfer of Cash Collateral shall be and
remain subject to, any other Lien conferred under the Loan Documents and the
other applicable provisions of the Loan Documents, (x) that Cash Collateral
furnished by or on behalf of a Loan Party shall not be released during the
continuance of a Default or Event of Default (and following application as
provided in this Section 2.15 may be otherwise applied in accordance with
Section 8.03), and (y) the Person providing Cash Collateral and the L/C Issuers
or Swing Line Lenders, as applicable, may agree that Cash Collateral shall not
be released but instead held to support future anticipated Fronting Exposure or
other obligations.

2.16 Defaulting Lenders. Notwithstanding anything to the contrary contained in
this Agreement:

(a) Waivers and Amendments. A Defaulting Lender’s right to approve or disapprove
any amendment, waiver or consent with respect to this Agreement shall be
restricted as set forth in Section 10.01.

 

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(b) Reallocation of Payments and Applicable Percentages. For purposes of
determining Lenders’ obligations or rights to fund, participate in or receive
collections with respect to Loans and Letters of Credit (including existing
Swingline Loans, Protective Advances and L/C Obligations), the Administrative
Agent may in its discretion reallocate Applicable Percentages by excluding a
Defaulting Lender’s Commitments and Loans from the calculation of thereof.

(c) Payments; Fees. The Administrative Agent may, in its discretion, receive and
retain any amounts payable to a Defaulting Lender under the Loan Documents, and
a Defaulting Lender shall be deemed to have assigned to the Administrative Agent
such amounts until all Obligations owing to the Administrative Agent,
non-Defaulting Lenders and other Secured Parties have been paid in full. The
Administrative Agent may use such amounts to cover the Defaulting Lender’s
defaulted obligations, to Cash Collateralize such Lender’s Fronting Exposure, to
readvance the amounts to the Borrower or to repay Obligations. A Lender shall
not be entitled to receive any fees accruing hereunder while it is a Defaulting
Lender and its unfunded Commitment shall be disregarded for purposes of
calculating the commitment fee under Section 2.09(a). If any L/C Obligations
owing to a Defaulted Lender are reallocated to other Lenders, fees attributable
to such L/C Obligations under Section 2.03(h) shall be paid to such Lenders. The
Administrative Agent shall be paid all fees attributable to L/C Obligations that
are not reallocated

(d) Defaulting Lender Cure. If the Borrower, the Administrative Agent, Swing
Line Lenders and the L/C Issuers agree in writing in their sole discretion that
a Defaulting Lender is no longer a Defaulting Lender, the Administrative Agent
will so notify the parties hereto, whereupon as of the effective date specified
in such notice and subject to any conditions set forth therein (which may
include arrangements with respect to any Cash Collateral), that Lender will, to
the extent applicable, purchase at par that portion of outstanding Loans of the
other Lenders or take such other actions as the Administrative Agent may
determine to be necessary to cause the Revolving Credit Loans and funded and
unfunded participations in Letters of Credit, Swing Line Loans and Protective
Advances to be held on a pro rata basis by the Lenders in accordance with their
Applicable Percentages (without giving effect to Section 2.16(b)), whereupon
that Lender will cease to be a Defaulting Lender; provided that no adjustments
will be made retroactively with respect to fees accrued or payments made by or
on behalf of the Borrower while that Lender was a Defaulting Lender; and
provided, further, that except to the extent otherwise expressly agreed by the
affected parties, no change hereunder from Defaulting Lender to Lender will
constitute a waiver or release of any claim of any party hereunder arising from
that Lender’s having been a Defaulting Lender.

2.17 Protective Advances. The Administrative Agent shall be authorized, in its
discretion, at any time that any condition in Section 4.02 is not satisfied, to
make Base Rate Loans (“Protective Advances”) (a) up to an aggregate amount of
$10,000,000 outstanding at any time, if the Administrative Agent deems such
Loans necessary or desirable to preserve or protect Collateral, or to enhance
the collectability or repayment of Obligations, as long as such Loans do not
cause Total Outstandings to exceed the aggregate Commitments; or (b) to pay any
other amounts chargeable to the Loan Parties under any Loan Documents, including
interest, costs, fees and expenses. Lenders shall participate in Protective
Advances outstanding from time to time in accordance with their respective
Applicable Percentages. The Required Lenders may at any time revoke the
Administrative Agent’s authority to make further Protective Advances under
clause (a) by written notice to the Administrative Agent. Absent such
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determination that funding of a Protective Advance is appropriate shall be
conclusive. No funding of a Protective Advance shall constitute a waiver by the
Administrative Agent or the Lenders of any Event of Default relating thereto. No
Loan Party shall be a beneficiary of this Section 2.17 nor authorized to enforce
any of its terms.

2.18 Overadvances. Any Overadvance shall be repaid by Borrower on demand by the
Administrative Agent, and shall constitute an Obligation secured by the
Collateral, entitled to all benefits of the Loan Documents. The Administrative
Agent may require the Lenders to fund Base Rate Loans that cause or constitute
an Overadvance and to forbear from requiring the Borrower to cure an
Overadvance, as long as the total Overadvance does not exceed 10% of the
Borrowing Base and does not continue for more than 30 consecutive days without
the consent of Required Lenders. In no event shall Loans be required that would
cause Total Oustandings to exceed the aggregate Commitments. No funding or
sufferance of an Overadvance shall constitute a waiver by the Administrative
Agent or the Lenders of the Event of Default caused thereby. No Obligor shall be
a beneficiary of this Section 2.18 nor authorized to enforce any of its terms.

ARTICLE III

TAXES, YIELD PROTECTION AND ILLEGALITY

3.01 Taxes. (a) Payments Free of Taxes; Obligation to Withhold; Payments on
Account of Taxes. (i) Any and all payments by or on account of any obligation of
the Borrower hereunder or under any other Loan Document shall to the extent
permitted by applicable Laws be made free and clear of and without reduction or
withholding for any Taxes. If, however, applicable Laws require an applicable
withholding agent to withhold or deduct any Tax, such Tax shall be withheld or
deducted in accordance with such Laws as determined by the Borrower or the
Administrative Agent, as the case may be, upon the basis of the information and
documentation to be delivered pursuant to subsection (e) below.

(ii) If any applicable withholding agent shall be required by applicable Law to
withhold or deduct any Taxes, including both United States federal backup
withholding and withholding Taxes, from any payment, then (A) such withholding
agent shall withhold or make such deductions as are determined by such
withholding agent to be required based upon the information and documentation it
has received pursuant to subsection (e) below, (B) such withholding agent shall
timely pay the full amount withheld or deducted to the relevant Governmental
Authority in accordance with applicable Law, and (C) if such Tax subject to
withholding or deduction is an Indemnified Tax, the sum payable by the Borrower
shall be increased as necessary so that after any required withholding or the
making of all required deductions (including deductions applicable to additional
sums payable under this Section) the applicable Recipient receives an amount
equal to the sum it would have received had no such withholding or deduction
been made.

(b) Payment of Other Taxes by the Borrower. Without limiting the provisions of
subsection (a) above, the Borrower shall timely pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable Law, or at the
option of the Administrative Agent timely reimburse it for the payment of any
Other Taxes.

 

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(c) Tax Indemnifications. (i) Without limiting the provisions of subsection
(a) or (b) above, the Borrower shall, and does hereby, indemnify each Recipient
and shall make payment in respect thereof within 10 days after demand therefor,
for the full amount of any Indemnified Taxes (including Indemnified Taxes
imposed or asserted on or attributable to amounts payable under this Section)
withheld or deducted by the Borrower or the Administrative Agent or paid by the
applicable Recipient and any penalties, interest and reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes were
correctly or legally imposed or asserted by the relevant Governmental Authority.
The Borrower shall also, and does hereby, indemnify the Administrative Agent,
and shall make payment in respect thereof within 10 days after demand therefor,
for any amount which a Lender or an L/C Issuer for any reason fails to pay
indefeasibly to the Administrative Agent as required by clause (ii) of this
subsection. A certificate as to the amount of any such payment or liability
delivered to the Borrower by a Recipient (with a copy to the Administrative
Agent), or by the Administrative Agent on its own behalf or on behalf of a
Lender or an L/C Issuer, shall be conclusive absent manifest error.

(ii) Without limiting the provisions of subsection (a) or (b) above, each Lender
and each L/C Issuer shall, and does hereby, indemnify the Administrative Agent,
and shall make payment in respect thereof within 10 days after demand therefor,
against any and all Taxes and any and all related losses, claims, liabilities,
penalties, interest and expenses (including the fees, charges and disbursements
of any counsel for the Administrative Agent) incurred by or asserted against the
Administrative Agent by any Governmental Authority as a result of the failure by
such Lender or such L/C Issuer, as the case may be, to deliver, or as a result
of the inaccuracy, inadequacy or deficiency of, any documentation required to be
delivered by such Lender or such L/C Issuer, as the case may be, to the
Administrative Agent pursuant to subsection (e). Each Lender and each L/C Issuer
hereby authorizes the Administrative Agent to set off and apply any and all
amounts at any time owing to such Lender or such L/C Issuer, as the case may be,
under this Agreement or any other Loan Document against any amount due to the
Administrative Agent under this clause (ii).

(d) Evidence of Payments. Upon request by the Borrower or the Administrative
Agent, as the case may be, after any payment of Taxes by the Borrower or the
Administrative Agent to a Governmental Authority as provided in this
Section 3.01, the Borrower shall deliver to the Administrative Agent or the
Administrative Agent shall deliver to the Borrower, as the case may be, the
original or a certified copy of a receipt issued by such Governmental Authority
evidencing such payment, a copy of any return required by Laws to report such
payment or other evidence of such payment reasonably satisfactory to the
Borrower or the Administrative Agent, as the case may be.

(e) Status of Lenders; Tax Documentation. (i) Any Lender that is entitled to an
exemption from or reduction of withholding Tax with respect to payments made
under any Loan Document shall deliver to the Borrower and the Administrative
Agent, at the time or times reasonably requested by the Borrower or the
Administrative Agent, such properly completed and executed documentation
reasonably requested by the Borrower or the Administrative Agent as will permit
such payments to be made without withholding or at a reduced rate of
withholding. In addition, any Lender, if reasonably requested by the Borrower or
the Administrative Agent, shall deliver such other documentation prescribed by
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Borrower or the Administrative Agent as will enable the Borrower or the
Administrative Agent to determine whether or not such Lender is subject to
backup withholding or information reporting requirements. Notwithstanding
anything to the contrary in the preceding two sentences, the completion,
execution and submission of such documentation (other than such documentation
set forth in Section 3.01(e)(ii)(A), (ii)(B) and (ii)(D) below) shall not be
required if in the Lender’s reasonable judgment such completion, execution or
submission would subject such Lender to any material unreimbursed cost or
expense or would materially prejudice the legal or commercial position of such
Lender.

(ii) Without limiting the generality of the foregoing,

(A) any Lender that is a U.S. Person shall deliver to the Borrower and the
Administrative Agent on or prior to the date on which such Lender becomes a
Lender under this Agreement (and from time to time thereafter upon the
reasonable request of the Borrower or the Administrative Agent), executed
originals of IRS Form W-9 certifying that such Lender is exempt from U.S.
federal backup withholding Tax;

(B) any Foreign Lender shall, to the extent it is legally entitled to do so,
deliver to the Borrower and the Administrative Agent (in such number of copies
as shall be requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the reasonable request of the Borrower or the Administrative
Agent), whichever of the following is applicable:

(1) in the case of a Foreign Lender claiming the benefits of an income tax
treaty to which the United States is a party (x) with respect to payments of
interest under any Loan Document, executed originals of IRS Form W-8BEN or IRS
Form W-8BEN-E establishing an exemption from, or reduction of, U.S. federal
withholding Tax pursuant to the “interest” article of such tax treaty and
(y) with respect to any other applicable payments under any Loan Document, IRS
Form W-8BEN or IRS Form W-8BEN-E establishing an exemption from, or reduction
of, U.S. federal withholding Tax pursuant to the “business profits” or “other
income” article of such tax treaty;

(2) executed originals of IRS Form W-8ECI;

(3) in the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under Section 881(c) of the Code, (x) a certificate
substantially in the form of Exhibit I-1 to the effect that such Foreign Lender
is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a
“10 percent shareholder” of the Borrower within the meaning of
Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation”
described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance
Certificate”) and (y) executed originals of IRS Form W-8BEN or IRS Form W-8BEN-E
(as applicable); or

 

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(4) to the extent a Foreign Lender is not the beneficial owner, executed
originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or
IRS Form W-8BEN-E (as applicable), a U.S. Tax Compliance Certificate
substantially in the form of Exhibit I-2 or Exhibit I-3, IRS Form W-9, and/or
other certification documents from each beneficial owner, as applicable;
provided that if the Foreign Lender is a partnership and one or more direct or
indirect partners of such Foreign Lender are claiming the portfolio interest
exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate
substantially in the form of Exhibit I-4 on behalf of each such direct and
indirect partner.

(C) any Foreign Lender shall, to the extent it is legally entitled to do so,
deliver to the Borrower and the Administrative Agent (in such number of copies
as shall be requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the reasonable request of the Borrower or the Administrative
Agent), executed originals of any other form prescribed by applicable Law as a
basis for claiming exemption from or a reduction in U.S. federal withholding
Tax, duly completed, together with such supplementary documentation as may be
prescribed by applicable Law to permit the Borrower or the Administrative Agent
to determine the withholding or deduction required to be made; and

(D) if a payment made to a Recipient under any Loan Document would be subject to
U.S. federal withholding Tax imposed by FATCA if such Recipient were to fail to
comply with the applicable reporting requirements of FATCA (including those
contained in Section 1471(b) or 1472(b) of the Code, as applicable), such
Recipient shall deliver to the Borrower and the Administrative Agent at the time
or times prescribed by Law and at such time or times reasonably requested by the
Borrower or the Administrative Agent such documentation prescribed by applicable
Law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such
additional documentation reasonably requested by the Borrower or the
Administrative Agent as may be necessary for the Borrower and the Administrative
Agent to comply with their obligations under FATCA and to determine that such
Recipient has complied with such Recipient’s obligations under FATCA or to
determine the amount to deduct and withhold from such payment. Solely for
purposes of this clause (D), “FATCA” shall include any amendments made to FATCA
after the date of this Agreement.

Each Lender agrees that if any form or certification it previously delivered
expires or becomes obsolete or inaccurate in any respect, it shall update such
form or certification or promptly notify the Borrower and the Administrative
Agent in writing of its legal inability to do so.

(f) Treatment of Certain Refunds. Unless required by applicable Laws, at no time
shall the Administrative Agent have any obligation to file for or otherwise
pursue on behalf of a Lender or an L/C Issuer, or have any obligation to pay to
any Lender or any L/C Issuer, any refund of Taxes withheld or deducted from
funds paid for the account of such Lender or such L/C Issuer, as the case may
be. If the Administrative Agent, any Lender or any L/C Issuer determines, in its
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discretion, that it has received a refund of any Taxes or Other Taxes as to
which it has been indemnified by the Borrower or with respect to which the
Borrower has paid additional amounts pursuant to this Section, it shall pay to
the Borrower an amount equal to such refund (but only to the extent of indemnity
payments made, or additional amounts paid, by the Borrower under this Section
with respect to the Taxes giving rise to such refund), net of all out-of-pocket
expenses incurred by the Administrative Agent, such Lender or such L/C Issuer,
as the case may be, and without interest (other than any interest paid by the
relevant Governmental Authority with respect to such refund), provided that the
Borrower, upon the request of the Administrative Agent, such Lender or such L/C
Issuer, agrees to repay the amount paid over to the Borrower (plus any
penalties, interest or other charges imposed by the relevant Governmental
Authority) to the Administrative Agent, such Lender or such L/C Issuer in the
event the Administrative Agent, such Lender or such L/C Issuer is required to
repay such refund to such Governmental Authority. This subsection shall not be
construed to require the Administrative Agent, any Lender or any L/C Issuer to
make available its Tax returns (or any other information relating to its Taxes
that it deems confidential) to the Borrower or any other Person.

(g) FATCA Grandfathering. For purposes of determining U.S. withholding Taxes
imposed under FATCA, from and after the date of this Agreement, the Borrower and
the Administrative Agent shall treat (and the Lenders hereby authorize the
Administrative Agent to treat) this Agreement as not qualifying as a
“grandfathered obligation” within the meaning of Treasury Regulation
Section 1.1471-2(b)(2)(i).

(h) Survival. Each party’s obligations under this Section 3.01 shall survive the
resignation or replacement of the Administrative Agent or any assignment of
rights by, or the replacement of, a Lender or an L/C Issuer, the termination of
the Commitments and the repayment, satisfaction or discharge of all other
Obligations.

3.02 Illegality. If any Lender determines that any Law has made it unlawful, or
that any Governmental Authority has asserted that it is unlawful, for any Lender
or its applicable Lending Office to make, maintain or fund Loans whose interest
is determined by reference to LIBOR, or to determine or charge interest rates
based upon LIBOR, or any Governmental Authority has imposed material
restrictions on the authority of such Lender to purchase or sell, or to take
deposits of, Dollars in the London interbank market, then, on notice thereof by
such Lender to the Borrower through the Administrative Agent, (i) any obligation
of such Lender to make or continue LIBOR Loans or to convert Base Rate Loans to
LIBOR Loans shall be suspended, and (ii) if such notice asserts the illegality
of such Lender making or maintaining Base Rate Loans the interest rate on which
is determined by reference to the LIBOR component of the Base Rate, the interest
rate on which Base Rate Loans of such Lender shall, if necessary to avoid such
illegality, be determined by the Administrative Agent without reference to the
LIBOR component of the Base Rate, in each case until such Lender notifies the
Administrative Agent and the Borrower that the circumstances giving rise to such
determination no longer exist. Upon receipt of such notice, (x) the Borrower
shall, upon demand from such Lender (with a copy to the Administrative Agent),
prepay or, if applicable, convert all LIBOR Loans of such Lender to Base Rate
Loans (the interest rate on which Base Rate Loans of such Lender shall, if
necessary to avoid such illegality, be determined by the Administrative Agent
without reference to the LIBOR component of the Base Rate), either on the last
day of the Interest Period therefor, if such Lender may lawfully continue to
maintain such LIBOR Loans to such day, or immediately, if such Lender may not
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such LIBOR Loans and (y) if such notice asserts the illegality of such Lender
determining or charging interest rates based upon LIBOR, the Administrative
Agent shall during the period of such suspension compute the Base Rate
applicable to such Lender without reference to the LIBOR component thereof until
the Administrative Agent is advised in writing by such Lender that it is no
longer illegal for such Lender to determine or charge interest rates based upon
LIBOR. Upon any such prepayment or conversion, the Borrower shall also pay
accrued interest on the amount so prepaid or converted.

3.03 Inability to Determine Rates. The Administrative Agent will promptly notify
the Borrower and the Lenders if, in connection with any Loan or request with
respect to a Loan, (a) the Administrative Agent determines that (i) Dollar
deposits are not being offered to banks in the London interbank eurodollar
market for the applicable Loan amount or Interest Period, or (ii) adequate and
reasonable means do not exist for determining LIBOR for the Loan or Interest
Period (including with respect to calculation of the Base Rate); or (b) the
Administrative Agent or the Required Lenders determine for any reason that LIBOR
for the Interest Period does not adequately and fairly reflect the cost to
Lenders of funding or maintaining the Loan. Thereafter, the Lenders’ obligations
to make or maintain affected LIBOR Loans and utilization of the LIBOR component
(if affected) in determining Base Rate shall be suspended until the
Administrative Agent determines (or is instructed by the Required Lenders) to
withdraw the notice. Upon receipt of such notice, the Borrower may revoke any
pending request for funding, conversion or continuation of a LIBOR Loan or,
failing that, will be deemed to have requested a Base Rate Loan, and the
Administrative Agent may (or shall upon request by the Required Lenders)
immediately convert any affected LIBOR Loan to a Base Rate Loan and/or disregard
the use of LIBOR in determining Base Rate.

3.04 Increased Costs; Capital Adequacy. (a) Increased Costs Generally. If any
Change in Law shall:

(i) impose, modify or deem applicable any reserve, liquidity, special deposit,
compulsory loan, insurance charge or similar requirement against assets of,
deposits with or for the account of, or credit extended or participated in by,
any Lender (except any reserve requirement reflected in calculating LIBOR) or
any L/C Issuer;

(ii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes,
(B) Taxes described in clauses (b) through (d) of the definition of Excluded
Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of
credit, commitments, or other obligations, or its deposits, reserves, other
liabilities or capital attributable thereto; or

(iii) impose on any Lender or any L/C Issuer or the London interbank market any
other condition, cost or expense affecting this Agreement or LIBOR Loans made by
such Lender or any Letter of Credit or participation therein;

and the result of any of the foregoing shall be to increase the cost to such
Lender of making, converting to, continuing or maintaining any Loan the interest
on which is determined by reference to LIBOR (or of maintaining its obligation
to make any such Loan), or to increase the cost to such Lender or such L/C
Issuer of participating in, issuing or maintaining any Letter of Credit (or of
maintaining its obligation to participate in or to issue any Letter of Credit),
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of any sum received or receivable by such Lender or such L/C Issuer hereunder
(whether of principal, interest or any other amount) then, upon request of such
Lender or such L/C Issuer, the Borrower will pay to such Lender or such L/C
Issuer, as the case may be, such additional amount or amounts as will compensate
such Lender or such L/C Issuer, as the case may be, for such additional costs
incurred or reduction suffered.

(b) Capital Requirements. If any Lender or any L/C Issuer determines that any
Change in Law affecting such Lender or such L/C Issuer or any Lending Office of
such Lender or such Lender’s or such L/C Issuer’s holding company, if any,
regarding capital or liquidity requirements has or would have the effect of
reducing the rate of return on such Lender’s or such L/C Issuer’s capital or on
the capital of such Lender’s or such L/C Issuer’s holding company, if any, as a
consequence of this Agreement, the Commitments of such Lender or the Loans made
by, or participations in Letters of Credit or Swing Line Loans held by, such
Lender, or the Letters of Credit issued by such L/C Issuer, to a level below
that which such Lender or such L/C Issuer or such Lender’s or such L/C Issuer’s
holding company could have achieved but for such Change in Law (taking into
consideration such Lender’s or such L/C Issuer’s policies and the policies of
such Lender’s or such L/C Issuer’s holding company with respect to capital
adequacy), then from time to time the Borrower will pay to such Lender or such
L/C Issuer, as the case may be, such additional amount or amounts as will
compensate such Lender or such L/C Issuer or such Lender’s or such L/C Issuer’s
holding company for any such reduction suffered.

(c) Certificates for Reimbursement. A certificate of a Lender or an L/C Issuer
setting forth the amount or amounts necessary to compensate such Lender or such
L/C Issuer or its holding company, as the case may be, as specified in
subsection (a) or (b) of this Section and delivered to the Borrower shall be
conclusive absent manifest error. The Borrower shall pay such Lender or such L/C
Issuer, as the case may be, the amount shown as due on any such certificate
within 10 days after receipt thereof.

(d) Delay in Requests. Failure or delay on the part of any Lender or any L/C
Issuer to demand compensation pursuant to the foregoing provisions of this
Section shall not constitute a waiver of such Lender’s or such L/C Issuer’s
right to demand such compensation, provided that the Borrower shall not be
required to compensate a Lender or an L/C Issuer pursuant to the foregoing
provisions of this Section for any increased costs incurred or reductions
suffered more than 180 days prior to the date that such Lender or such L/C
Issuer, as the case may be, notifies the Borrower of the Change in Law giving
rise to such increased costs or reductions and of such Lender’s or such L/C
Issuer’s intention to claim compensation therefor (except that, if the Change in
Law giving rise to such increased costs or reductions is retroactive, then the
180-day period referred to above shall be extended to include the period of
retroactive effect thereof).

(e) Reserves on LIBOR Loans. The Borrower shall pay to each Lender, (i) as long
as such Lender shall be required to maintain reserves with respect to
liabilities or assets consisting of or including Eurocurrency funds or deposits
(currently known as “Eurocurrency liabilities”), additional interest on the
unpaid principal amount of each LIBOR Loan equal to the actual costs of such
reserves allocated to such Loan by such Lender (as determined by such Lender in
good faith, which determination shall be conclusive) and (ii) as long as such
Lender shall be required to comply with any reserve ratio requirement or
analogous requirement of any central banking or financial regulatory authority
imposed in respect of the maintenance of the Commitments or the

 

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funding of the Loans, such additional costs (expressed as a percentage per annum
and rounded upwards, if necessary, to the nearest five decimal places) equal to
the actual costs allocated to such Commitment or Loan by such Lender (as
determined by such Lender in good faith, which determination shall be
conclusive), which shall be due and payable on each date on which interest is
payable on such Loan, provided the Borrower shall have received at least 10
days’ prior notice (with a copy to the Administrative Agent) of such additional
interest from such Lender. If a Lender fails to give notice 10 days prior to the
relevant Interest Payment Date, such additional interest shall be due and
payable 10 days from receipt of such notice.

3.05 Compensation for Losses. Upon demand of any Lender (with a copy to the
Administrative Agent) from time to time, the Borrower shall promptly compensate
such Lender for and hold such Lender harmless from any loss, cost or expense
incurred by it as a result of:

(a) any continuation, conversion, payment or prepayment of any LIBOR Loan on a
day other than the last day of the Interest Period for such Loan (whether
voluntary, mandatory, automatic, by reason of acceleration, or otherwise);

(b) any failure by the Borrower (for a reason other than the failure of such
Lender to make a Loan) to prepay, borrow, continue or convert any LIBOR Loan on
the date or in the amount notified by the Borrower; or

(c) any assignment of a LIBOR Loan on a day other than the last day of the
Interest Period therefor as a result of a request by the Borrower pursuant to
Section 10.13;

including any loss of anticipated profits and any loss or expense arising from
the liquidation or reemployment of funds obtained by it to maintain such Loan or
from fees payable to terminate the deposits from which such funds were obtained.
The Borrower shall also pay any customary administrative fees charged by such
Lender in connection with the foregoing.

For purposes of calculating amounts payable by the Borrower to the Lenders under
this Section 3.05, each Lender shall be deemed to have funded each LIBOR Loan
made by it at LIBOR for such Loan by a matching deposit or other borrowing in
the London interbank eurodollar market for a comparable amount and for a
comparable period, whether or not such LIBOR Loan was in fact so funded.

3.06 Mitigation Obligations; Replacement of Lenders. (a) Designation of a
Different Lending Office. If any Lender requests compensation under
Section 3.04, or the Borrower is required to pay any additional amount to any
Lender, any L/C Issuer, or any Governmental Authority for the account of any
Lender or any L/C Issuer pursuant to Section 3.01, or if any Lender gives a
notice pursuant to Section 3.02, then such Lender or such L/C Issuer shall, as
applicable, use reasonable efforts to designate a different Lending Office for
funding or booking its Loans hereunder or to assign its rights and obligations
hereunder to another of its offices, branches or affiliates, if, in the judgment
of such Lender or such L/C Issuer, such designation or assignment (i) would
eliminate or reduce amounts payable pursuant to Section 3.01 or 3.04, as the
case may be, in the future, or eliminate the need for the notice pursuant to
Section 3.02, as applicable, and (ii) in each case, would not subject such
Lender or such L/C Issuer, as the case may be, to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender or such L/C
Issuer, as the case may be. The Borrower hereby agrees to pay all reasonable
costs and expenses incurred by any Lender or any L/C Issuer in connection with
any such designation or assignment.

 

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(b) Replacement of Lenders. If any Lender requests compensation under
Section 3.04, or if the Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 3.01, the Borrower may replace such Lender in accordance with
Section 10.13.

3.07 Survival. All of the Borrower’s obligations under this Article III shall
survive termination of the Aggregate Commitments, repayment of all other
Obligations hereunder, and resignation of the Administrative Agent.

ARTICLE IV

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

4.01 Conditions of Initial Credit Extension. The obligation of each L/C Issuer
and each Lender to make its initial Credit Extension hereunder (including the
deemed issuance of the Existing Letters of Credit) is subject to satisfaction of
the following conditions precedent:

(a) The Administrative Agent’s receipt of the following, each of which shall be
originals or telecopies (followed promptly by originals) unless otherwise
specified, each properly executed by a Responsible Officer of the signing Loan
Party, each dated the Closing Date (or, in the case of certificates of
governmental officials, a recent date before the Closing Date) and each in form
and substance satisfactory to the Administrative Agent and each of the Lenders:

(i) executed counterparts of this Agreement and the Guaranty, sufficient in
number for distribution to the Administrative Agent, each Lender and the
Borrower;

(ii) a Note executed by the Borrower in favor of each Lender requesting a Note;

(iii) the Collateral Rights Agreement, duly executed by each of the parties
thereto;

(iv) the Security Agreement, duly executed by each Loan Party, together with:

(A) proper Financing Statements in form appropriate for filing under the Uniform
Commercial Code of all jurisdictions that the Administrative Agent may deem
necessary or desirable in order to perfect the Liens created under the Security
Agreement, covering the Collateral described in the Security Agreement,

(B) UCC and Lien searches and other evidence satisfactory to the Administrative
Agent that Liens in favor of the Administrative Agent are the only Liens upon
the Collateral, except Liens permitted under Section 7.01,

(C) evidence of the completion of all other actions, recordings and filings of
or with respect to the Security Agreement that the Administrative Agent may deem
necessary or desirable in order to perfect the Liens created thereby,

 

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(D) the Account Control Agreements and the Securities Account Control Agreement
(in each case, as defined in the Security Agreement) required pursuant to the
Security Agreement and duly executed by the appropriate parties, and

(E) evidence that all other action that the Administrative Agent may deem
necessary or desirable in order to perfect the Liens created under the Security
Agreement has been taken (including receipt of duly executed payoff letters and
UCC-3 termination statements);

(v) such certificates of resolutions or other action, incumbency certificates
and/or other certificates of Responsible Officers of each Loan Party as the
Administrative Agent may require evidencing the identity, authority and capacity
of each Responsible Officer thereof authorized to act as a Responsible Officer
in connection with this Agreement and the other Loan Documents to which such
Loan Party is a party or is to be a party;

(vi) such documents and certifications as the Administrative Agent may
reasonably require to evidence that each Loan Party is duly organized or formed,
and that the Borrower and each Guarantor is validly existing, in good standing
and qualified to engage in business in each jurisdiction where its ownership,
lease or operation of properties or the conduct of its business requires such
qualification, except to the extent that failure to do so could not reasonably
be expected to have a Material Adverse Effect;

(vii) a favorable written opinion of each of (i) Thompson & Knight LLP, counsel
to the Loan Parties, (ii) Bryan Cave LLP, Colorado counsel to the Loan Parties,
(iii) Lynch, Chappell & Alsup, New Mexico counsel to the Loan Parties and
(iv) the Law Offices of Morris Laing, as Kansas counsel to the Loan Parties, in
each case addressed to the Administrative Agent and each Lender, as to the
matters concerning the Loan Parties and the Loan Documents as the Required
Lenders may reasonably request;

(viii) a certificate signed by a Responsible Officer of the Borrower certifying
(A) that the conditions specified in Sections 4.02(a) and (b) have been
satisfied, (B) that, after giving effect to the issuance or deemed issuance of
any Letters of Credit on the Closing Date, any additional Credit Extension on
the Closing Date, the payment by Borrower of all fees and expenses due hereunder
and all payments due on the Closing Date, (y) Availability hereunder plus
unrestricted cash on hand of the Loan Parties is not less than $100,000,000 and
(z) Availability hereunder is not less than $60,000,000, and (C) that attached
to such certificate are true and correct calculations evidencing satisfaction of
the conditions described in clause (B) above;

(ix) a Borrowing Base Certificate as of August 31, 2018;

(x) a financial forecast of the Borrower and its Subsidiaries on a consolidated
basis prepared by management of the Borrower, including consolidated balance
sheets and statements of income or operations and cash flows of the Borrower and
its Subsidiaries on an annual basis for each of the Borrower’s fiscal years 2018
through and including 2023;

 

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(xi) for the fiscal quarter ended June 30, 2018, a consolidated balance sheet of
the Borrower and its Subsidiaries as at the end of such fiscal quarter, and the
related consolidated statements of income or operations, changes in
shareholders’ equity, and cash flows for such fiscal quarter, all in reasonable
detail, certified by the chief executive officer, chief financial officer,
treasurer or controller of the Borrower as fairly presenting in all material
respects the financial condition, results of operations, shareholders’ equity
and cash flows of the Borrower and its Subsidiaries in accordance with GAAP,
subject only to normal year-end audit adjustments and the absence of footnotes;

(xii) certificates attesting to the Solvency of each Material Loan Party before
and after giving effect to entering into this Agreement and any repayment or
incurrence of Indebtedness on the Closing Date and the payment of fees and
expenses in connection therewith, from its chief financial officer;

(xiii) evidence that all insurance required to be maintained pursuant to the
Loan Documents has been obtained and is in effect, together with the
certificates of insurance, naming the Administrative Agent, on behalf of the
Lenders, as an additional insured or loss payee, as the case may be, under all
insurance policies maintained with respect to the assets and properties of the
Loan Parties that constitute Collateral;

(xiv) duly executed payoff letters from the Receivables Facility Agent in
respect of the Receivables Facility Agreement and from the Term Loan Agent in
respect of the Term Loan Agreement together with all related release instruments
and attachments thereto, in each case in form and substance reasonably
satisfactory to the Administrative Agent;

(xv) evidence that the following transactions shall have been (or shall
concurrently be) consummated, in each case on terms and conditions reasonably
satisfactory to the Administrative Agent:

(A) the Borrower shall have issued the Senior Notes pursuant to the Senior Notes
Indenture which result in aggregate gross proceeds to the Borrower of not less
than $297,126,000;

(B) all principal, premium, if any, interest, fees and other amounts due or
outstanding under the Receivables Facility Agreement, shall have been paid in
full, the commitments thereunder terminated and all guarantees and security in
support thereof discharged and released, and the Administrative Agent shall have
received reasonably satisfactory evidence thereof;

(C) the Receivables Transfer Agreement dated as of September 29, 2017, among
Basic Energy Services, L.P., Basic Energy Receivables, LLC and the other parties
party thereto shall have been terminated, and the Administrative Agent shall
have received reasonably satisfactory evidence thereof;

(D) BER shall have reassigned to the Loan Parties all of the Accounts which it
had purchased from the Loan Parties and transferred to the Loan Parties all
collections with respect thereto; and

 

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(E) all principal, premium, interest, fees and other amounts due or outstanding
under the Term Loan Agreement shall have been paid in full, the commitments
thereunder terminated and all guarantees and security in support thereof
discharged and released, and the Administrative Agent shall have received
reasonably satisfactory evidence thereof;

(xvi) if applicable, a duly executed Letter of Credit Application for each
Letter of Credit requested to be issued on the Closing Date, together with all
other documents and information pertaining to such requested Letter of Credit
issuance as the L/C Issuer or the Administrative Agent may require; and

(xvii) such other assurances, certificates, documents, consents or opinions as
the Administrative Agent, the L/C Issuers, the Swing Line Lenders or any Lender
reasonably may require.

(b) (i) All fees required to be paid to the Administrative Agent, MLPFS and any
L/C Issuer on or before the Closing Date shall have been paid and (ii) all fees
required to be paid to the Administrative Agent on behalf of the Lenders on or
before the Closing Date shall have been paid.

(c) Unless waived by the Administrative Agent, the Borrower shall have paid all
reasonable and documented fees, charges and disbursements of counsel to the
Administrative Agent (directly to such counsel if requested by the
Administrative Agent) to the extent invoiced prior to or on the Closing Date,
plus such additional amounts of such fees, charges and disbursements as shall
constitute its reasonable estimate of such fees, charges and disbursements
incurred or to be incurred by it through the closing proceedings (provided that
such estimate shall not thereafter preclude a final settling of accounts between
the Borrower and the Administrative Agent).

(d) (i) All accrued but unpaid letter of credit fees, and other amounts
outstanding with respect to the Existing Letters of Credit shall have been paid
in full; provided that, for the avoidance of doubt, the Existing Letters of
Credit issued by Bank of America and outstanding on the Closing Date shall
remain outstanding as Letters of Credit hereunder and shall be subject to and
governed by the terms and conditions hereof and (ii) that certain Cash
Collateral Agreement dated as of September 29, 2017 between the Borrower and
Bank of America relating to the Existing Letters of Credit shall have been
terminated.

(e) All consents, licenses, approvals, waivers, acknowledgements and other
agreements required in connection with the execution, delivery and performance
by such Loan Party, and the validity against such Loan Party, of the Loan
Documents to which it is a party shall be in full force and effect.

(f) The Borrower shall have provided, in form and substance satisfactory to the
Administrative Agent and each Lender, all documentation and other information as
the Administrative Agent or any Lender deems appropriate in connection with
applicable “know your customer” and anti-money-laundering rules and regulations,
including the Patriot Act and Beneficial Ownership Regulation. If the Borrower
or any other Loan Party qualifies as a “legal entity customer” under the
Beneficial Ownership Regulation, it shall deliver a Beneficial Ownership
Certification to the Administrative Agent and the Lenders upon request.

 

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Without limiting the generality of the provisions of the last paragraph of
Section 9.03, for purposes of determining compliance with the conditions
specified in this Section 4.01, each Lender that has signed this Agreement shall
be deemed to have consented to, approved or accepted or to be satisfied with,
each document or other matter required thereunder to be consented to or approved
by or acceptable or satisfactory to a Lender unless the Administrative Agent
shall have received notice from such Lender prior to the proposed Closing Date
specifying its objection thereto.

4.02 Conditions to all Credit Extensions. The obligation of each Lender to honor
any Request for Credit Extension (other than a Revolving Credit Loan Notice
requesting only a conversion of Revolving Credit Loans to the other Type, or a
continuation of LIBOR Loans) is subject to the following conditions precedent:

(a) The representations and warranties of the Borrower and each other Loan Party
contained in Article V or any other Loan Document, or which are contained in any
document furnished at any time under or in connection herewith or therewith,
shall be true and correct in all material respects on and as of the date of such
Credit Extension, except to the extent that (i) such representations and
warranties are qualified by materiality or reference to “Material Adverse
Effect”, in which case such representations and warranties shall be true and
correct in all respects, and (ii) that such representations and warranties
specifically refer to an earlier date, in which case they shall be true and
correct in all material respects (without duplication of any materiality
qualification applicable thereto) as of such earlier date; provided that for
purposes of this Section 4.02, the representations and warranties contained in
Sections 5.05(a) and (b) shall be deemed to refer to the most recent statements
furnished pursuant to Sections 6.01(a) and (b), respectively.

(b) No Default shall exist, or would result from such proposed Credit Extension
or from the application of the proceeds thereof.

(c) The Administrative Agent and, if applicable, the applicable L/C Issuer or
the applicable Swing Line Lender shall have received a Request for Credit
Extension in accordance with the requirements hereof.

Each Request for Credit Extension (other than a Revolving Credit Loan Notice
requesting only a conversion of Revolving Credit Loans to the other Type or a
continuation of LIBOR Loans) submitted by the Borrower shall be deemed to be a
representation and warranty that the conditions specified in Sections 4.02(a)
and (b) have been satisfied on and as of the date of the applicable Credit
Extension.

ARTICLE V

REPRESENTATIONS AND WARRANTIES

The Borrower represents and warrants to the Administrative Agent and the Lenders
that:

5.01 Existence, Qualification and Power. Each Loan Party and each of its
Restricted Subsidiaries (a) is duly organized or formed, validly existing and,
as applicable, in good standing under the Laws of the jurisdiction of its
incorporation or organization, (b) has all requisite power

 

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and authority and all requisite governmental licenses, authorizations, consents
and approvals to (i) own or lease its assets and carry on its business and
(ii) execute, deliver and perform its obligations under the Loan Documents to
which it is a party, and (c) is duly qualified and is licensed and, as
applicable, in good standing under the Laws of each jurisdiction where its
ownership, lease or operation of properties or the conduct of its business
requires such qualification or license; except in each case referred to in
clause (b)(i) or (c), to the extent that failure to do so could not reasonably
be expected to have a Material Adverse Effect. As of the Closing Date, all
information included in any Beneficial Ownership Certification is true and
complete in all respects.

5.02 Authorization; No Contravention. The execution, delivery and performance by
each Loan Party of each Loan Document to which such Person is or is to be a
party have been duly authorized by all necessary corporate or other
organizational action, and do not and will not (a) contravene the terms of any
of such Person’s Organization Documents; (b) conflict with or result in any
breach or contravention of, under, or require any payment to be made under any
Contractual Obligation to which such Person is a party or affecting such Person
or the properties of such Person or any of its Restricted Subsidiaries, except
for conflicts, breaches or contraventions that could not reasonably be expected
to result in a Material Adverse Effect, (c) violate any Law or any order,
injunction, writ or decree of any Governmental Authority or any arbitral award
to which such Person or its property is subject; or (d) result in the creation
or imposition of any Lien on any property of the Borrower or any Restricted
Subsidiary except Liens created under the Loan Documents.

5.03 Governmental Authorization; Other Consents. No approval, consent,
exemption, authorization, or other action by, or notice to, or filing with, any
Governmental Authority or any other Person is necessary or required in
connection with (a) the execution, delivery or performance by, or enforcement
against, any Loan Party of this Agreement or any other Loan Document, (b) the
grant by any Loan Party of the Liens granted by it pursuant to the Collateral
Documents, (c) the perfection or continuance of the Liens created under the
Collateral Documents (including the first priority nature thereof) or (d) the
exercise by the Administrative Agent or any Lender of its rights under the Loan
Documents or the remedies in respect of the Collateral pursuant to the
Collateral Documents, except for the authorizations, approvals, actions, notices
and filings which (i) have been duly obtained, taken, given or made and are in
full force and effect, (ii) are required by the Loan Documents or (iii) in the
case of any authorization, approval, action, notice or filing from or with a
Person other than a Governmental Authority, the failure to have could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

5.04 Binding Effect. This Agreement has been, and each other Loan Document, when
delivered hereunder, will have been, duly executed and delivered by each Loan
Party that is party thereto. This Agreement constitutes, and each other Loan
Document when so delivered will constitute, a legal, valid and binding
obligation of such Loan Party, enforceable against each Loan Party that is party
thereto in accordance with its terms except as such enforcement may be limited
by bankruptcy, insolvency or similar Laws of general application relating to the
enforcement of creditors’ rights and by general principles of equity.

 

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5.05 Financial Statements; No Material Adverse Effect. (a) The Audited Financial
Statements (i) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly noted
therein; (ii) fairly present in all material respects the financial condition of
the Borrower and its Subsidiaries as of the date thereof and their results of
operations for the period covered thereby in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly
noted therein; and (iii) show or describe all material indebtedness and other
liabilities, direct or contingent, of the Borrower and its Subsidiaries as of
the date thereof, including liabilities for taxes, material commitments and
Indebtedness.

(b) Since the date of the Audited Financial Statements, there has been no event
or circumstance, either individually or in the aggregate, that has had or could
reasonably be expected to have a Material Adverse Effect.

(c) The consolidated forecasted balance sheet, statements of income and cash
flows of the Borrower and its Subsidiaries delivered pursuant to Section 4.01 or
Section 6.01(c) were prepared in good faith on the basis of the assumptions
stated therein, which assumptions were fair in light of the conditions existing
at the time of delivery of such forecasts, and represented, at the time of
delivery, the Borrower’s best estimate of its future financial condition and
performance, recognizing that there are industry-wide risks normally associated
with the types of business conducted by the Borrower and its Subsidiaries and
that the Borrower does not warrant that such forecasts and estimates will
ultimately prove to have been accurate.

5.06 Litigation. There are no actions, suits, proceedings, claims or disputes
pending or, to the knowledge of the Borrower, threatened or contemplated, at
law, in equity, in arbitration or before any Governmental Authority, by or
against the Borrower or any of its Subsidiaries or against any of their
properties or revenues that (a) purport to affect or pertain to this Agreement
or any other Loan Document, or (b) either individually or in the aggregate, if
determined adversely, could reasonably be expected to have a Material Adverse
Effect.

5.07 No Default. Neither any Loan Party nor any Restricted Subsidiary thereof is
in default under or with respect to, or a party to, any Contractual Obligation
that could, either individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect. No Default has occurred and is continuing or
would result from the consummation of the transactions contemplated by this
Agreement or any other Loan Document.

5.08 Ownership of Property; Liens; Investments. Each Loan Party and each of its
Restricted Subsidiaries has good title to, or valid leasehold interests in, all
of their respective property necessary or used in the ordinary conduct of its
business, except for such defects in title as could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.

5.09 Environmental Compliance. (a) The Loan Parties and their respective
Subsidiaries conduct in the ordinary course of business a review of the effect
of existing Environmental Laws and claims alleging potential liability or
responsibility for violation of any Environmental Law on their respective
businesses, operations and properties, and as a result thereof the Borrower has
reasonably concluded that such Environmental Laws and claims could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

 

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(b) None of the properties currently owned or operated or, to the knowledge of
any Loan Party, formerly owned or operated, by any Loan Party or any of its
Subsidiaries is listed or proposed for listing on the NPL or on the CERCLIS or
any analogous foreign, state or local list or is adjacent to any such property.
Except as in accordance in all material respects with the requirements of all
Environmental Laws: (i) there are no and never have been any underground or
above-ground storage tanks or any surface impoundments, septic tanks, pits,
sumps or lagoons in which Hazardous Materials are being or have been treated,
stored or disposed on any property currently owned or operated by any Loan Party
or any of its Subsidiaries or, to the best of the knowledge of the Loan Parties,
on any property formerly owned or operated by any Loan Party or any of its
Subsidiaries and (ii) Hazardous Materials have not been released, discharged or
disposed of on any property currently or formerly owned or operated by any Loan
Party or any of its Subsidiaries. Except as could not, individually or in the
aggregate, reasonably be expected to cause a Material Adverse Effect, there is
no asbestos or asbestos-containing material on any property currently owned or
operated by any Loan Party or any of its Subsidiaries.

(c) Neither any Loan Party nor any of its Subsidiaries is undertaking, and has
not completed, either individually or together with other potentially
responsible parties, any investigation or assessment or remedial or response
action relating to any actual or threatened release, discharge or disposal of
Hazardous Materials at any site, location or operation, either voluntarily or
pursuant to the order of any Governmental Authority or the requirements of any
Environmental Law except for any investigations, assessments or remedial or
response actions not reasonably expected to result in any material liability to
any Loan Party or any of its Subsidiaries. All Hazardous Materials generated,
used, treated, handled or stored at, or transported to or from, any property
currently or formerly owned or operated by any Loan Party or any of its
Subsidiaries have been disposed of in accordance with the requirements of all
Environmental Laws in all material respects and in a manner not reasonably
expected to result in material liability to any Loan Party or any of its
Subsidiaries.

(d) The Borrower and each of its Subsidiaries have obtained all Environmental
Permits necessary for the ownership and operation of its properties and assets
and the conduct of its business except where the failure to do so could, either
individually or in the aggregate, reasonably be expected to result in material
liability to any Loan Party or any of its Subsidiaries. Except where the failure
to do so could not, either individually or in the aggregate, reasonably be
expected to cause a Material Adverse Effect, the Borrower and each of its
Subsidiaries have been and are in compliance with all terms and conditions of
such Environmental Permits. There are no pending or, to the knowledge of the
Borrower, threatened, claims against the Borrower or any Subsidiary under any
Environmental Laws and neither the Borrower nor any Subsidiary has received any
written notice of alleged non-compliance with applicable Environmental Laws or
Environmental Permits which could, in each case, either individually or in the
aggregate, reasonably be expected to (i) cause a Material Adverse Effect or
(ii) result in material liability to any Loan Party or any of its Subsidiaries.

5.10 Insurance. The properties of the Borrower and its Restricted Subsidiaries
are insured with financially sound and reputable insurance companies not
Affiliates of the Borrower, in such amounts (after giving effect to any
self-insurance compatible with the following standards), with such deductibles
and covering such risks as are customarily carried by companies engaged in
similar businesses and owning similar properties in localities where the
Borrower or the applicable Restricted Subsidiary operates.

 

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5.11 Taxes. The Borrower and its Restricted Subsidiaries have filed all federal,
state and other material Tax returns and reports required to be filed, and have
paid all federal, state and other material Taxes, assessments, fees and other
governmental charges levied or imposed upon them or their properties, income or
assets otherwise due and payable, except those which are being contested in good
faith by appropriate proceedings diligently conducted and for which adequate
reserves have been provided in accordance with GAAP. There is no proposed Tax
assessment against the Borrower or any Restricted Subsidiary that would, if
made, have a Material Adverse Effect. Neither any Loan Party nor any Subsidiary
thereof is party to any Tax sharing agreement.

5.12 ERISA Compliance.

(a) There are no pending or, to the best knowledge of the Borrower, threatened
claims, actions or lawsuits, or action by any Governmental Authority, with
respect to any Plan that could reasonably be expected to have a Material Adverse
Effect. There has been no prohibited transaction or violation of the fiduciary
responsibility rules with respect to any Plan that has resulted or could
reasonably be expected to result in a Material Adverse Effect.

(b) Except as could not, either individually or in the aggregate, reasonably be
expected to cause a Material Adverse Effect: (i) no ERISA Event has occurred,
and neither the Borrower nor any ERISA Affiliate is aware of any fact, event or
circumstance that could reasonably be expected to constitute or result in an
ERISA Event with respect to any Pension Plan; (ii) the Borrower and each ERISA
Affiliate has met all applicable requirements under the Pension Funding Rules in
respect of each Pension Plan, and no waiver of the minimum funding standards
under the Pension Funding Rules has been applied for or obtained; (iii) as of
the most recent valuation date for any Pension Plan, the funding target
attainment percentage (as defined in Section 430(d)(2) of the Code) is 60% or
higher and neither the Borrower nor any ERISA Affiliate knows of any facts or
circumstances that could reasonably be expected to cause the funding target
attainment percentage for any such plan to drop below 60% as of the most recent
valuation date; (iv) neither the Borrower nor any ERISA Affiliate has incurred
any liability to the PBGC other than for the payment of premiums, and there are
no premium payments which have become due that are unpaid; (v) neither the
Borrower nor any ERISA Affiliate has engaged in a transaction that could be
subject to Section 4069 or Section 4212(c) of ERISA; (vi) no Pension Plan has
been terminated by the plan administrator thereof nor by the PBGC, and no event
or circumstance has occurred or exists that could reasonably be expected to
cause the PBGC to institute proceedings under Title IV of ERISA to terminate any
Pension Plan; and (vii) the Borrower and each ERISA Affiliate have maintained
each Plan (other than a Multiemployer Plan) in compliance with the applicable
provisions of ERISA, the Code and other federal or state laws.

5.13 Subsidiaries; Equity Interests; Loan Parties. As of the Closing Date, no
Loan Party has any Subsidiaries other than those specifically disclosed in Part
(a) of Schedule 5.13, and all of the outstanding Equity Interests in such
Subsidiaries have been validly issued, are fully paid and non-assessable and are
owned by a Loan Party in the amounts specified on Part (a) of Schedule 5.13 free
and clear of all Liens except those permitted under Section 7.01. As of the
Closing Date, no Loan Party has any equity investments in any other corporation
or entity other

 

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than those specifically disclosed in Part (b) of Schedule 5.13. Set forth on
Part (c) of Schedule 5.13 is a complete and accurate list of all Loan Parties,
showing as of the Closing Date (as to each Loan Party) the jurisdiction of its
incorporation, the address of its principal place of business and its U.S.
taxpayer identification number or, in the case of any non-U.S. Loan Party that
does not have a U.S. taxpayer identification number, its unique identification
number issued to it by the jurisdiction of its incorporation. As of the Closing
Date, each of BER, BER Holdco, Robota and BESI is an Immaterial Domestic
Subsidiary.

5.14 Margin Regulations; Investment Company Act. (a) The Borrower is not engaged
and will not engage, principally or as one of its important activities, in the
business of purchasing or carrying margin stock (within the meaning of
Regulation U issued by the FRB), or extending credit for the purpose of
purchasing or carrying margin stock. Following the application of the proceeds
of each Borrowing or drawing under each Letter of Credit, not more than 25% of
the value of the assets (either of the Borrower only or of the Borrower and its
Subsidiaries on a consolidated basis) subject to the provisions of Section 7.01
or Section 7.05 or subject to any restriction contained in any agreement or
instrument between the Borrower and any Lender or any Affiliate of any Lender
relating to Indebtedness and within the scope of Section 8.01(e) will be margin
stock.

(b) None of the Borrower, any Person Controlling the Borrower, or any Subsidiary
is or is required to be registered as an “investment company” under the
Investment Company Act of 1940.

5.15 Disclosure. The Borrower has disclosed to the Administrative Agent and the
Lenders all agreements, instruments and corporate or other restrictions to which
it or any of its Subsidiaries or any other Loan Party is subject, and all other
matters known to it, that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect. No report, financial statement,
certificate or other information furnished by or on behalf of any Loan Party to
the Administrative Agent or any Lender in connection with the transactions
contemplated hereby and the negotiation of this Agreement or delivered hereunder
or under any other Loan Document (in each case as modified or supplemented by
other information so furnished), when taken as a whole, contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided that, with respect to projections, budgets,
estimates and other forward looking statements, the Borrower represents only
that such information was prepared in good faith based upon assumptions believed
to be reasonable at the time, recognizing that there are industry-wide risks
normally associated with the types of business conducted by the Borrower and its
Subsidiaries and that the Borrower does not warrant that such projections,
budgets, estimates and other forward looking statements will ultimately prove to
have been accurate.

5.16 Compliance with Laws. Each Loan Party and each Restricted Subsidiary
thereof is in compliance in all material respects with the requirements of all
Laws and all orders, writs, injunctions and decrees applicable to it or to its
properties, except in such instances in which (a) such requirement of Law or
order, writ, injunction or decree is being contested in good faith by
appropriate proceedings diligently conducted or (b) the failure to comply
therewith, either individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.

 

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5.17 Intellectual Property; Licenses, Etc. The Borrower and each of its
Restricted Subsidiaries own, or possess the right to use, all of the trademarks,
service marks, trade names, copyrights, patents, patent rights, franchises,
licenses and other intellectual property rights (collectively, “IP Rights”) that
are reasonably necessary for the operation of their respective businesses,
without conflict with the rights of any other Person to the extent such conflict
could reasonably be expected to have a Material Adverse Effect. To the best
knowledge of the Borrower, no slogan or other advertising device, product,
process, method, substance, part or other material now employed, or now
contemplated to be employed, by the Borrower or any of its Restricted
Subsidiaries infringes upon any rights held by any other Person. No claim or
litigation regarding any of the foregoing is pending or, to the best knowledge
of the Borrower, threatened, which, either individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect.

5.18 Solvency. Each Material Loan Party is, individually and together with its
Subsidiaries on a consolidated basis, Solvent.

5.19 Casualty, Etc. Neither the businesses nor the properties of any Loan Party
or any of its Restricted Subsidiaries are affected by any fire, explosion,
accident, strike, lockout or other labor dispute, drought, storm, hail,
earthquake, embargo, act of God or of the public enemy or other casualty
(whether or not covered by insurance) that, either individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.

5.20 Labor Matters. There are no collective bargaining agreements or
Multiemployer Plans covering the employees of the Borrower or any of its
Restricted Subsidiaries as of the Closing Date and neither the Borrower nor any
Restricted Subsidiary has suffered any strikes, walkouts, work stoppages or
other material labor difficulty within the last five years.

5.21 Collateral Documents. The provisions of the Collateral Documents are
effective to create in favor of the Administrative Agent for the benefit of the
Secured Parties a legal, valid and enforceable first priority Lien (subject to
Liens permitted by Section 7.01) on all right, title and interest of the
respective Loan Parties in the Collateral described therein. Except for filings
completed prior to the Closing Date and as contemplated hereby and by the
Collateral Documents and for such other action completed on or prior to the
Closing Date, no filing or other action will be necessary to perfect or protect
such Liens.

5.22 Sanctions Concerns. No Loan Party, nor any Subsidiary, nor, to the
knowledge of the Loan Parties and their Subsidiaries, any director, officer,
employee, agent, affiliate or representative thereof, is an individual or entity
that is, or is owned or controlled by any individual or entity that is,
(a) currently the subject or target of any Sanctions or (b) located, organized
or resident in a Designated Jurisdiction.

5.23 EEA Financial Institutions. No Loan Party is an EEA Financial Institution.

5.24 Indenture Compliance. None of (a) the execution or performance of the Loan
Documents, (b) the incurrence of any Obligations by the Loan Parties or (c) the
granting of any Liens securing the Obligations violates the Senior Notes
Indenture, including Section 3.2 thereof, or the other Senior Notes Documents.
The Borrower further represents that the Aggregate Commitments and Obligations
constitute “Permitted Debt” under the Senior Notes Indenture. The

 

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Administrative Agent may condition Borrowings, Letters of Credit, Commitment
increases and other credit accommodations under the Loan Documents from time to
time upon the Administrative Agent’s receipt of evidence that the Aggregate
Commitments and Obligations continue to constitute “Permitted Debt” under the
Senior Notes Indenture at such time.

ARTICLE VI

AFFIRMATIVE COVENANTS

So long as any Lender shall have any Commitment hereunder, any Loan or other
Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, the Borrower shall, and shall (except in the case of
the covenants set forth in Sections 6.01, 6.02, 6.03 and 6.11) cause each
Restricted Subsidiary to:

6.01 Financial Statements; Borrowing Base Certificate. Deliver to the
Administrative Agent and each Lender, in form and detail satisfactory to the
Administrative Agent and the Required Lenders:

(a) as soon as available, but in any event within 90 days after the end of each
fiscal year of the Borrower (or, if earlier, 15 days after the date required to
be filed with the SEC (without giving effect to any extension permitted by the
SEC)) (commencing with the fiscal year ending December 31, 2018), a consolidated
balance sheet of the Borrower and its Subsidiaries as at the end of such fiscal
year, and the related consolidated statements of income or operations, changes
in shareholders’ equity, and cash flows for such fiscal year, setting forth in
each case in comparative form the figures for the previous fiscal year, all in
reasonable detail and prepared in accordance with GAAP, audited and accompanied
by a report and opinion of an independent certified public accountant of
nationally recognized standing, which report and opinion shall be prepared in
accordance with generally accepted auditing standards and shall not be subject
to any “going concern” or like qualification or exception or any qualification
or exception as to the scope of such audit other than with respect to, or
resulting from, (i) an upcoming maturity date or (ii) any potential inability to
satisfy any financial covenant on a future date or for a future period;

(b) as soon as available, but in any event within 45 days after the end of each
of the first three fiscal quarters of each fiscal year of the Borrower (or, if
earlier, 5 days after the date required to be filed with the SEC (without giving
effect to any extension permitted by the SEC)) (commencing with the fiscal
quarter ending September 30, 2018), a consolidated balance sheet of the Borrower
and its Subsidiaries as at the end of such fiscal quarter, and the related
consolidated statements of income or operations, changes in shareholders’
equity, and cash flows for such fiscal quarter and for the portion of the
Borrower’s fiscal year then ended, setting forth in each case in comparative
form the figures for the corresponding fiscal quarter of the previous fiscal
year and the corresponding portion of the previous fiscal year, all in
reasonable detail, certified by the chief executive officer, chief financial
officer, treasurer or controller of the Borrower as fairly presenting in all
material respects the financial condition, results of operations, shareholders’
equity and cash flows of the Borrower and its Subsidiaries in accordance with
GAAP, subject only to normal year-end audit adjustments and the absence of
footnotes;

 

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(c) if there are any Unrestricted Subsidiaries as of the end of any fiscal
period covered by the financial statements referred to in Section 6.01(a) or
(b), concurrently with the delivery of such financial statements, internally
prepared consolidating financial statements reconciling the financial condition
of the Borrower’s Restricted Subsidiaries and Unrestricted Subsidiaries, in a
format reasonably acceptable to the Administrative Agent, certified by the chief
executive officer, chief financial officer, treasurer or controller of the
Borrower as presenting fairly in all material respects the financial condition
and results of operations of the Restricted Subsidiaries and Unrestricted
Subsidiaries of the Borrower in accordance with GAAP;

(d) if a Monthly Financial Reporting Trigger Period is in effect, as soon as
available, but in any event within 30 days after the end of each month, a
consolidated balance sheet of the Borrower and its Subsidiaries as at the end of
such month, and the related consolidated statements of income or operations,
changes in shareholders’ equity, and cash flows for such month and for the
portion of the Borrower’s fiscal year then ended, setting forth in each case in
comparative form the figures for the corresponding month of the previous fiscal
year and the corresponding portion of the previous fiscal year, all in
reasonable detail, certified by the chief executive officer, chief financial
officer, treasurer or controller of the Borrower as fairly presenting in all
material respects the financial condition, results of operations, shareholders’
equity and cash flows of the Borrower and its Subsidiaries in accordance with
GAAP, subject only to normal year-end audit adjustments and the absence of
footnotes;

(e) as soon as available, but in any event not later than 45 days after the end
of each fiscal year of the Borrower, a financial forecast of the Borrower and
its Subsidiaries on a consolidated and, if there are any Unrestricted
Subsidiaries, consolidating basis prepared by management of the Borrower, in
form satisfactory to the Administrative Agent and the Required Lenders,
including consolidated and, if there are any Unrestricted Subsidiaries,
consolidating balance sheets and statements of income or operations and cash
flows of the Borrower and its Subsidiaries on a quarterly basis for the
immediately following fiscal year (including the fiscal year in which the
Maturity Date occurs);

(f) a Borrowing Base Certificate prepared as of the end of the applicable
period, as soon as available, but in any event (i) when no Weekly BBC Trigger
Period is in effect, not later than 15 days after the end of each month and
(ii) when a Weekly BBC Trigger Period is in effect, not later than 3 Business
Days after the end of each week. All calculations of Availability in any
Borrowing Base Certificate shall originally be made by the Borrower and
certified by the chief executive officer, chief financial officer, treasurer or
controller of the Borrower, provided that the Administrative Agent may from time
to time review and adjust any such calculation (A) to reflect its reasonable
estimate of declines in value of any Collateral, due to collections received in
the Dominion Accounts or otherwise; and (B) to the extent the calculation is not
made in accordance with this Agreement or does not accurately reflect the
Availability Reserve.

As to any information contained in materials furnished pursuant to
Section 6.02(d), the Borrower shall not be separately required to furnish such
information under Section 6.01(a) or (b) above, but the foregoing shall not be
in derogation of the obligation of the Borrower to furnish the information and
materials described in Sections 6.01(a) and (b) above at the times specified
therein.

 

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6.02 Certificates; Other Information. Deliver to the Administrative Agent and
each Lender, in form and detail satisfactory to the Administrative Agent and the
Required Lenders:

(a) concurrently with the delivery of the financial statements referred to in
Section 6.01(a), a certificate of its independent certified public accountants
certifying such financial statements and stating that in making the examination
necessary therefor no knowledge was obtained of any Default under the financial
covenants set forth herein or, if any such Default shall exist, stating the
nature and status of such event;

(b) concurrently with the delivery of the financial statements referred to in
Sections 6.01(a), (b) and (c), a duly completed Compliance Certificate,
including a calculation of the Consolidated Fixed Charge Coverage Ratio whether
or not the financial covenant is being tested at such time, signed by the chief
executive officer, chief financial officer, treasurer or controller of the
Borrower (which delivery may, unless the Administrative Agent, or a Lender
requests executed originals, be by electronic communication including fax or
email and shall be deemed to be an original authentic counterpart thereof for
all purposes);

(c) promptly after any request by the Administrative Agent or any Lender, copies
of any detailed audit reports, management letters or recommendations submitted
to the board of directors (or the audit committee of the board of directors) of
any Loan Party by independent accountants in connection with the accounts or
books of any Loan Party or any of its Subsidiaries, or any audit of any of them;

(d) promptly after the same are available, copies of each annual report, proxy
or financial statement or other report or communication sent to the stockholders
of the Borrower, and copies of all annual, regular, periodic and special reports
and registration statements which the Borrower may file or be required to file
with the SEC under Section 13 or 15(d) of the Securities Exchange Act of 1934,
or with any national securities exchange, and in any case not otherwise required
to be delivered to the Administrative Agent pursuant hereto;

(e) promptly after the furnishing thereof, copies of any statement or report
furnished to any holder of debt securities of any Loan Party or of any of its
Restricted Subsidiaries pursuant to the terms of the Senior Notes Indenture or
any other indenture, loan or credit or similar agreement and not otherwise
required to be furnished to the Lenders pursuant to Section 6.01 or any other
clause of this Section 6.02;

(f) as soon as available, but in any event within 30 days after the end of each
fiscal year of the Borrower, a report summarizing the insurance coverage
(specifying type, amount and carrier) in effect for each Loan Party and its
Restricted Subsidiaries and containing such additional information as the
Administrative Agent, or any Lender through the Administrative Agent, may
reasonably specify;

(g) promptly, and in any event within five Business Days after receipt thereof
by any Loan Party or any Restricted Subsidiary thereof, copies of each notice or
other correspondence received from the SEC (or comparable agency in any
applicable non-U.S. jurisdiction) concerning any investigation or possible
investigation or other inquiry by such agency regarding financial or other
operational results of any Loan Party or any Subsidiary thereof;

 

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(h) not later than five Business Days after receipt thereof by any Loan Party or
any Subsidiary thereof, copies of all material notices, requests and other
documents (including amendments, waivers and other modifications) received under
or pursuant to the Senior Notes Indenture or any other instrument, indenture,
loan or credit or similar agreement and, from time to time upon request by the
Administrative Agent, such information and reports regarding the Senior Notes
Indenture and such other instruments, indentures and loan and credit and similar
agreements as the Administrative Agent may reasonably request;

(i) promptly after the assertion or occurrence thereof, notice of any action or
proceeding against or of any noncompliance by any Loan Party or any of its
Subsidiaries with any Environmental Law or Environmental Permit that could
reasonably be expected to have a Material Adverse Effect; and

(j) promptly, such additional information regarding the business, financial,
legal or corporate affairs of any Loan Party or any Subsidiary thereof, or
compliance with the terms of the Loan Documents, as the Administrative Agent or
any Lender may from time to time reasonably request, including without
limitation, information for purposes of compliance with applicable “know your
customer” and anti-money-laundering rules and regulations, including, without
limitation, the Patriot Act and the Beneficial Ownership Regulation.

Documents required to be delivered pursuant to Section 6.01(a) or (b) or
Section 6.02(d) (to the extent any such documents are included in materials
otherwise filed with the SEC) may be delivered electronically and if so
delivered, shall be deemed to have been delivered on the date (i) on which the
Borrower posts such documents, or provides a link thereto on the Borrower’s
website on the Internet at the website address listed on Schedule 10.02; or
(ii) on which such documents are posted on the Borrower’s behalf on an Internet
or intranet website, if any, to which each Lender and the Administrative Agent
have access (whether a commercial, third-party website or whether sponsored by
the Administrative Agent); provided that: (i) the Borrower shall deliver paper
copies of such documents to the Administrative Agent or any Lender upon its
request to the Borrower to deliver such paper copies until a written request to
cease delivering paper copies is given by the Administrative Agent or such
Lender and (ii) the Borrower shall notify the Administrative Agent and each
Lender (by fax transmission or e-mail) of the posting of any such documents and
provide to the Administrative Agent by electronic mail electronic versions
(i.e., soft copies) of such documents. The Administrative Agent shall have no
obligation to request the delivery of or to maintain paper copies of the
documents referred to above, and in any event shall have no responsibility to
monitor compliance by the Borrower with any such request by a Lender for
delivery, and each Lender shall be solely responsible for requesting delivery to
it or maintaining its copies of such documents.

The Borrower hereby acknowledges that (a) the Administrative Agent and/or the
Arrangers will make available to the Lenders and the L/C Issuers materials
and/or information provided by or on behalf of the Borrower hereunder
(collectively, “Borrower Materials”) by posting the Borrower Materials on
IntraLinks, Debt Domain, Syndtrak, ClearPar, or another similar electronic
system (the “Platform”) and (b) certain of the Lenders (each, a “Public Lender”)
may have personnel who do not wish to receive material non-public information
with respect to the Borrower or its Affiliates, or the respective securities of
any of the foregoing, and who may be engaged in investment and other
market-related activities with respect to such Persons’ securities. The Borrower
hereby agrees that it will use commercially reasonable efforts to identify that
portion of the Borrower Materials that may be distributed to the Public Lenders
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Borrower Materials shall be clearly and conspicuously marked “PUBLIC” which, at
a minimum, shall mean that the word “PUBLIC” shall appear prominently on the
first page thereof; (x) by marking Borrower Materials “PUBLIC,” the Borrower
shall be deemed to have authorized the Administrative Agent, the Arrangers, the
L/C Issuers and the Lenders to treat such Borrower Materials as not containing
any material non-public information (although it may be sensitive and
proprietary) with respect to the Borrower or its securities for purposes of
United States federal and state securities laws (provided, however, that to the
extent such Borrower Materials constitute Information, they shall be treated as
set forth in Section 10.07); (y) all Borrower Materials marked “PUBLIC” are
permitted to be made available through a portion of the Platform designated
“Public Side Information;” and (z) the Administrative Agent and the Arrangers
shall be entitled to treat any Borrower Materials that are not marked “PUBLIC”
as being suitable only for posting on a portion of the Platform not designated
“Public Side Information”.

6.03 Notices. Promptly notify the Administrative Agent and each Lender:

(a) of the occurrence of any Default;

(b) (i) the breach or non-performance of, or any default under, a Contractual
Obligation of the Borrower or any Restricted Subsidiary; (ii) any dispute,
litigation, investigation, proceeding or suspension between the Borrower or any
Restricted Subsidiary and any Governmental Authority; (iii) the commencement of,
or any material development in, any litigation or proceeding affecting the
Borrower or any Restricted Subsidiary, including pursuant to any applicable
Environmental Laws, (iv) or any other matter, in each case, that has resulted or
could reasonably be expected to result in a Material Adverse Effect;

(c) the commencement of, or any material development in, any investigation,
litigation or proceeding affecting the Borrower or any Restricted Subsidiary
pursuant to any applicable Environmental Laws which could, either individually
or in the aggregate, reasonably be expected to result in material liability to
any Loan Party or any of its Restricted Subsidiaries;

(d) of the occurrence of any ERISA Event; and

(e) of any material change in accounting policies or financial reporting
practices by any Loan Party or any Subsidiary thereof, including any
determination by the Borrower referred to in Section 2.10(b).

Each notice pursuant to Section 6.03 shall be accompanied by a statement of a
Responsible Officer of the Borrower setting forth details of the occurrence
referred to therein and stating what action the Borrower has taken and proposes
to take with respect thereto. Each notice pursuant to Section 6.03(a) shall
describe with particularity any and all provisions of this Agreement and any
other Loan Document that have been breached.

6.04 Payment of Obligations. Pay and discharge as the same shall become due and
payable, all its material obligations and liabilities, including (a) all Tax
liabilities, assessments and governmental charges or levies upon it or its
properties or assets, unless the same are being contested in good faith by
appropriate proceedings diligently conducted and adequate reserves in accordance
with GAAP are being maintained by the Borrower or such Restricted Subsidiary;
(b) all lawful claims which, if unpaid, would by law become a Lien upon its
property, unless the

 

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same are being contested in good faith by appropriate proceedings diligently
conducted and adequate reserves in accordance with GAAP are being maintained by
the Borrower or such Restricted Subsidiary; and (c) all Indebtedness, as and
when due and payable, but subject to any subordination provisions contained in
any instrument or agreement evidencing such Indebtedness.

6.05 Preservation of Existence, Etc.. (a) Preserve, renew and maintain in full
force and effect the Borrower’s and the Material Loan Parties’ legal existence
and good standing under the Laws of the jurisdiction of its organization except
in a transaction permitted by Section 7.04 or 7.05; (b) take all reasonable
action to maintain all rights, privileges, permits, licenses and franchises
necessary or desirable in the normal conduct of its business, except to the
extent that failure to do so could not reasonably be expected to have a Material
Adverse Effect; and (c) preserve or renew all of its registered patents,
trademarks, trade names and service marks, the non-preservation of which could
reasonably be expected to have a Material Adverse Effect.

6.06 Maintenance of Properties. (a) Maintain, preserve and protect all of its
material properties and equipment necessary in the operation of its business in
good working order and condition, ordinary wear and tear excepted; (b) make all
necessary repairs thereto and renewals and replacements thereof except where the
failure to do so could not reasonably be expected to have a Material Adverse
Effect; and (c) use the standard of care typical in the industry in the
operation and maintenance of its facilities.

6.07 Maintenance of Insurance. (a) Maintain insurance with respect to the
Collateral, covering casualty, hazard, theft, malicious mischief, flood and
other risks, in amounts, with endorsements and with insurers (with a Best’s
Financial Strength Rating of at least A+, unless otherwise approved by the
Administrative Agent in its discretion) satisfactory to the Administrative
Agent. All proceeds under each policy covering Collateral shall be payable to
the Administrative Agent as a lender loss payee. From time to time upon request,
the Borrower shall deliver to the Administrative Agent the originals or
certified copies of its insurance policies. Unless the Administrative Agent
shall agree otherwise, each policy shall include satisfactory endorsements that
(i) provide for not less than 30 days prior notice to the Administrative Agent
of termination, lapse or cancellation of such insurance, (ii) with respect to
insurance covering Collateral, name the Administrative Agent as loss payee, and
(iii) specify that the interest of the Administrative Agent shall not be
impaired or invalidated by any act or negligence of any Loan Party or the owner
of the property, nor by the occupation of the premises for purposes more
hazardous than are permitted by the policy. If the Borrower fails to provide and
pay for any insurance, the Administrative Agent may, at its option, but shall
not be required to, procure the insurance and charge the Borrower therefor. The
Borrower agrees to deliver to the Administrative Agent, promptly as rendered,
copies of all reports made to insurance companies. While no Event of Default
exists, the Loan Parties may settle, adjust or compromise any insurance claim,
as long as the proceeds are delivered to the Administrative Agent. If an Event
of Default exists, only the Administrative Agent shall be authorized to settle,
adjust and compromise such claims.

(b) In addition to the insurance required under clause (a) with respect to
Collateral, maintain insurance with insurers (with a Best’s Financial Strength
Rating of at least A+, unless otherwise approved by the Administrative Agent in
its discretion) satisfactory to the Administrative Agent, with respect to the
properties and business of the Loan Parties, of such type (including product
liability, workers’ compensation, larceny, embezzlement, or other criminal
misappropriation insurance), in such amounts, and with such coverages and
deductibles as are at the time of placing such insurance customary for companies
similarly situated and which are available at commercially reasonable rates.

 

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6.08 Compliance with Laws. Comply in all material respects with the requirements
of all Laws (including Anti-Terrorism Laws) and all orders, writs, injunctions
and decrees applicable to it or to its business or property, except in such
instances in which (a) such requirement of Law or order, writ, injunction or
decree is being contested in good faith by appropriate proceedings diligently
conducted; or (b) the failure to comply (other than failure to comply with
Anti-Terrorism Laws) therewith could not reasonably be expected to have a
Material Adverse Effect.

6.09 Books and Records. (a) Maintain proper books of record and account, in
which full, true and correct entries in conformity with GAAP consistently
applied shall be made of all financial transactions and matters involving the
assets and business of the Borrower or such Restricted Subsidiary, as the case
may be; and (b) maintain such books of record and account in material conformity
with all applicable requirements of any Governmental Authority having regulatory
jurisdiction over the Borrower or such Restricted Subsidiary, as the case may
be.

6.10 Inspection Rights. (a) Permit representatives and independent contractors
of the Administrative Agent and each Lender to visit and inspect any of its
properties, to examine its corporate, financial and operating records, and make
copies thereof or abstracts therefrom, and to discuss its affairs, finances and
accounts with its directors, officers, and independent public accountants, all
at such reasonable times during normal business hours and as often as may be
reasonably desired, upon reasonable advance notice to the Borrower; provided,
however, that when an Event of Default exists the Administrative Agent or any
Lender (or any of their respective representatives or independent contractors)
may do any of the foregoing at the expense of the Borrower at any time during
normal business hours and without advance notice.

(b) Subject to the reimbursement limitations contained in the next sentence, at
any time upon the Administrative Agent’s request, the Loan Parties will allow
the Administrative Agent (or its designee) to conduct field examinations to
ensure the adequacy of Collateral included in any Borrowing Base and related
reporting and control systems, and prepared on a basis reasonably satisfactory
to the Administrative Agent, such field examinations to include, without
limitation, information required by applicable Law. The Borrower shall reimburse
the Administrative Agent for all reasonable and documented charges, costs and
expenses (including a reasonable per diem field examination charge and out of
pocket expenses) related thereto with respect to no more than one such field
examination during each calendar year; provided that if Availability is at any
time less than the greater of (i) $33,750,000 and (ii) 22.5% of the Borrowing
Base, the Borrower shall reimburse the Administrative Agent for all reasonable
charges, costs and expenses (including a reasonable per diem field examination
charge and out of pocket expenses) related to a second such field examination
during such calendar year (without any obligation on the part of the
Administrative Agent to conduct such examination); and provided, further, that
when an Event of Default exists, there shall be no limitation on the number or
frequency of field examinations that shall be at the sole expense of the
Borrower. For the purposes of clarity, any field examination commenced when an
Event of Default exists may be completed at the Borrower’s sole expense
notwithstanding the cessation of such Event of Default. The Secured Parties
shall have no duty to any Loan Party to make any inspection, nor to share any
results of any inspection, appraisal or report with any Loan Party. The Borrower
acknowledge that all inspections, appraisals and reports are prepared by the
Administrative Agent and/or the Lenders are for their purposes, and the Borrower
shall not be entitled to rely upon them.

 

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6.11 Use of Proceeds. Use the proceeds of the Credit Extensions (i) to refinance
certain existing indebtedness on the Closing Date and (ii) for working capital
and other general corporate purposes, including the financing of Permitted
Acquisitions, Investments permitted by Section 7.03 and any other use permitted
by the Loan Documents in each case not in contravention of any Law or of any
Loan Document.

6.12 Covenant to Guarantee Obligations and Give Security. (a) With respect to
(x) any Person that becomes a direct or indirect Subsidiary after the Closing
Date (other than a CFC, a Subsidiary that is held directly or indirectly by a
CFC, any Immaterial Domestic Subsidiary created or acquired after the Closing
Date and any Unrestricted Subsidiary), (y) any Immaterial Domestic Subsidiary
(including BER, BER Holdco, Robota and BESI) that ceases to be an Immaterial
Domestic Subsidiary and (z) any Subsidiary that is designated as a Restricted
Subsidiary in accordance with Section 6.19(c), then the Borrower shall, at the
Borrower’s expense:

(i) within 15 days after such formation, acquisition, ceasing to be an
Immaterial Domestic Subsidiary or designation as a Restricted Subsidiary (or
such longer period as may be agreed by the Administrative Agent in its sole
discretion), cause such Subsidiary, and cause each direct and indirect parent of
such Subsidiary (if it has not already done so), to duly execute and deliver to
the Administrative Agent a guaranty or guaranty supplement, in form and
substance satisfactory to the Administrative Agent, guaranteeing the other Loan
Parties’ obligations under the Loan Documents,

(ii) within 15 days after such formation, acquisition, ceasing to be an
Immaterial Domestic Subsidiary or designation as a Restricted Subsidiary (or
such longer period as may be agreed by the Administrative Agent in its sole
discretion), cause such Subsidiary and each direct and indirect parent of such
Subsidiary (if it has not already done so) to duly execute and deliver to the
Administrative Agent a Security Agreement Supplement and other security and
pledge agreements, as specified by and in form and substance satisfactory to the
Administrative Agent (including delivery of other instruments of the type
specified in Section 4.01(a)(iv)), securing payment of all the Obligations of
such Subsidiary or such parent, as the case may be, under the Loan Documents and
constituting Liens on all such property (other than Excluded Properties)
purported to be subject to such Collateral Document,

(iii) within 15 days after such formation, acquisition, ceasing to be an
Immaterial Domestic Subsidiary or designation as a Restricted Subsidiary (or
such longer period as may be agreed by the Administrative Agent in its sole
discretion), cause such Subsidiary and each direct and indirect parent of such
Subsidiary (if it has not already done so) to take whatever action (including
the filing of Uniform Commercial Code financing statements, the giving of
notices and the endorsement of notices on title documents) may be necessary or
advisable in the opinion of the Administrative Agent to vest in the
Administrative Agent (or in any representative of the Administrative Agent
designated by it) valid and subsisting Liens on the properties purported to be
subject to the Security Agreement Supplement and security and pledge agreements
delivered pursuant to this Section 6.12, enforceable against all third parties
in accordance with their terms, and

 

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(iv) within 60 days after such formation, acquisition, ceasing to be an
Immaterial Domestic Subsidiary or designation as a Restricted Subsidiary (or
such longer period as may be agreed by the Administrative Agent in its sole
discretion), deliver to the Administrative Agent, upon the request of the
Administrative Agent in its sole discretion, a signed copy of a favorable
opinion, addressed to the Administrative Agent and the other Secured Parties, of
counsel for the Loan Parties reasonably acceptable to the Administrative Agent
as to the matters contained in clauses (i), (ii) and (iii) above, and as to such
other matters as the Administrative Agent may reasonably request;

provided that, notwithstanding anything to the contrary in this Section 6.12(a),
with respect to the formation or acquisition of a Permitted Water Subsidiary,
the requirements of this Section 6.12(a) with respect to such Permitted Water
Subsidiary shall be satisfied substantially concurrently with such formation or
acquisition.

(b) Upon the acquisition of any property by any Loan Party of a type that is
intended to be Collateral, if such property, in the judgment of the
Administrative Agent, shall not already be subject to a perfected security
interest in favor of the Administrative Agent for the benefit of the Secured
Parties, then the Borrower shall, at the Borrower’s expense:

(i) within 15 days after such acquisition (or such longer period as may be
agreed by the Administrative Agent in its sole discretion), furnish to the
Administrative Agent a description of the property so acquired in detail
satisfactory to the Administrative Agent,

(ii) within 15 days after such acquisition (or such longer period as may be
agreed by the Administrative Agent in its sole discretion), (A) cause the
applicable Loan Party to duly execute and deliver to the Administrative Agent
Security Agreement Supplements and other security and pledge agreements, as
specified by and in form and substance satisfactory to the Administrative Agent,
securing payment of all the Obligations of the applicable Loan Party under the
Loan Documents and constituting Liens on all such personal properties and
(B) cause the applicable Loan Party to take whatever action (including the
filing of Uniform Commercial Code financing statements, the giving of notices
and the endorsement of notices on title documents) may be necessary or advisable
in the opinion of the Required Lenders to vest in the Administrative Agent (or
in any representative of the Administrative Agent designated by it) valid and
subsisting Liens on such property, enforceable against all third parties, and

(iii) within 60 days after such acquisition (or such longer period as may be
agreed by the Administrative Agent in its sole discretion), deliver to the
Administrative Agent, upon the request of the Administrative Agent in its sole
discretion, a signed copy of a favorable opinion, addressed to the
Administrative Agent and the other Secured Parties, of counsel for the Loan
Parties reasonably acceptable to the Administrative Agent as to the matters
contained in clause (ii) above and as to such other matters as the
Administrative Agent may reasonably request.

 

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(c) At any time upon request of the Administrative Agent, promptly execute and
deliver any and all further instruments and documents and take all such other
action as the Administrative Agent may reasonably deem necessary or desirable in
obtaining the full benefits of, or (as applicable) in perfecting and preserving
the Liens of, such guaranties, Security Agreement Supplements and other security
and pledge agreements.

(d) Upon (i) BER, (ii) BER Holdco, (iii) Robota, (iv) BESI or (v) any other
Domestic Subsidiary that is a Restricted Subsidiary becoming a guarantor of the
Senior Notes, such Person shall be deemed to be a “Guarantor” for purposes of
this Agreement and the Borrower shall promptly cause such Person to duly execute
and deliver to the Administrative Agent a guaranty or guaranty supplement, in
form and substance satisfactory to the Administrative Agent, guaranteeing the
other Loan Parties’ obligations under the Loan Documents and to deliver such
other Loan Documents and take such other actions specified in clause (a) above
within the time frames specified therein.

(e) Notwithstanding the foregoing, if, as of the end of any fiscal quarter, the
Immaterial Domestic Subsidiaries collectively (i) generated more than 5% of
Consolidated EBITDA for the Measurement Period most recently ended for which
financial statements of the Borrower are available or (ii) own net assets that
have an aggregate fair market value equal to or greater than 5.0% of
Consolidated Tangible Assets of the Borrower, then in each case the Borrower
shall cause one or more of such Immaterial Domestic Subsidiaries to execute a
joinder agreement (or agreements) such that after giving effect thereto, (A) all
such remaining Immaterial Domestic Subsidiaries that are not Guarantors
generated less than 5% of Consolidated EBITDA for such Measurement Period and
(B) the total net assets owned by all such remaining Immaterial Domestic
Subsidiaries that are not Guarantors will have an aggregate fair market value of
less than 5.0% of the Consolidated Tangible Assets of the Borrower.

6.13 Compliance with Environmental Laws. Comply, and cause all lessees and other
Persons operating or occupying its properties to comply, in all material
respects, with all applicable Environmental Laws and Environmental Permits;
obtain and renew all Environmental Permits necessary for its operations and
properties; and conduct any investigation, study, sampling and testing, and
undertake any cleanup, removal, remedial or other action necessary to remove and
clean up all Hazardous Materials from any of its properties, in accordance with
the requirements of all Environmental Laws in all material respects; provided,
however, that neither the Borrower nor any of its Restricted Subsidiaries shall
be required to undertake any such cleanup, removal, remedial or other action to
the extent that its obligation to do so is being contested in good faith and by
proper proceedings and appropriate reserves are being maintained with respect to
such circumstances in accordance with GAAP.

6.14 Preparation of Environmental Reports. At the request of the Required
Lenders during the existence of any Default, provide to the Lenders within
60 days (or such longer period as the Administrative Agent may agree in its sole
discretion) after such request, at the expense of the Borrower, an environmental
site assessment report for any of its properties described in such request,
prepared by an environmental consulting firm acceptable to the Administrative
Agent, indicating the presence or absence of Hazardous Materials and the
estimated cost of any compliance, removal or remedial action in connection with
any Hazardous Materials on such properties. Without limiting the generality of
the foregoing, if the Administrative Agent

 

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determines at any time that a material risk exists that any such report will not
be provided within the time referred to above, the Administrative Agent may
retain an environmental consulting firm to prepare such report at the expense of
the Borrower, and the Borrower hereby grants and agrees to cause any Restricted
Subsidiary that owns any property described in such request to grant at the time
of such request to the Administrative Agent, the Lenders, such firm and any
agents or representatives thereof an irrevocable non-exclusive license, subject
to the rights of tenants, to enter onto their respective properties to undertake
such an assessment.

6.15 Further Assurances. Promptly upon the reasonable request by the
Administrative Agent, or any Lender through the Administrative Agent,
(a) correct any material defect or error that may be discovered in any Loan
Document or in the execution, acknowledgment, filing or recordation thereof, and
(b) do, execute, acknowledge, deliver, record, re-record, file, re-file,
register and re-register any and all such further acts, deeds, certificates,
assurances and other instruments as the Administrative Agent, or any Lender
through the Administrative Agent, may reasonably require from time to time in
order to (i) carry out more effectively the purposes of the Loan Documents,
(ii) to the fullest extent permitted by applicable Law, subject any Loan Party’s
or any of its Restricted Subsidiaries’ properties, assets, rights or interests
to the Liens now or hereafter intended to be covered by any of the Collateral
Documents, (iii) perfect and maintain the validity, effectiveness and priority
of any of the Collateral Documents and any of the Liens intended to be created
thereunder and (iv) assure, convey, grant, assign, transfer, preserve, protect
and confirm more effectively unto the Secured Parties the rights granted or now
or hereafter intended to be granted to the Secured Parties under any Loan
Document or under any other instrument executed in connection with any Loan
Document to which any Loan Party or any of its Restricted Subsidiaries is or is
to be a party, and cause each of its Restricted Subsidiaries to do so.

6.16 Compliance with Terms of Leaseholds. Make all payments and otherwise
perform all obligations in respect of all leases of real property to which the
Borrower or any of its Restricted Subsidiaries is a party, keep such leases in
full force and effect and not allow such leases to lapse or be terminated or any
rights to renew such leases to be forfeited or cancelled, notify the
Administrative Agent of any default by any party with respect to such leases and
cooperate with the Administrative Agent in all respects to cure any such
default, and cause each of its Restricted Subsidiaries to do so, except, in any
case, where the failure to do so, either individually or in the aggregate, could
not be reasonably likely to have a Material Adverse Effect.

6.17 Material Contracts. Perform and observe all the terms and provisions of
each Material Contract to be performed or observed by it, maintain each such
Material Contract in full force and effect, enforce each such Material Contract
in accordance with its terms, take all such action to such end as may be from
time to time requested by the Administrative Agent and, upon request of the
Administrative Agent, make to each other party to each such Material Contract
such demands and requests for information and reports or for action as any Loan
Party or any of its Restricted Subsidiaries is entitled to make under such
Material Contract, and cause each of its Restricted Subsidiaries to do so,
except, in any case, where the failure to do so, either individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.

 

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6.18 Administration of Deposit Accounts. Schedule 6.18 sets forth all deposit
accounts maintained by the Loan Parties, including all Dominion Accounts. The
Loan Parties shall take all actions necessary to establish Administrative
Agent’s control of each such deposit account (other than an account exclusively
used for payroll, payroll taxes or employee benefits and one or more deposit
accounts established for the benefit of the Senior Notes Trustee containing
solely proceeds of collateral for the Senior Notes (and not proceeds of the
Collateral or any Loans) (each, a “Senior Notes Collateral Account”)), except
for a deposit account containing not more than $250,000 at any time; provided
that such deposit accounts over which Administrative Agent does not have control
shall not contain more than $2,000,000 in the aggregate as of any date. The
applicable Loan Party shall be the sole account holder of each deposit account
and shall not allow any other Person (other than Administrative Agent or, solely
in respect of any Senior Notes Collateral Account, the Senior Notes Trustee) to
have control over a deposit account or any property deposited therein. The
Borrower shall promptly notify the Administrative Agent of any opening or
closing of a deposit account by any Loan Party and, with the consent of
Administrative Agent, will amend Schedule 6.18 to reflect same.

6.19 Designation and Conversion of Restricted and Unrestricted Subsidiaries;
Covenants With Respect to Unrestricted Subsidiaries.

(a) Unless designated as an Unrestricted Subsidiary in accordance with
Section 6.19(b), any Person that becomes a Subsidiary of the Borrower or any of
its Restricted Subsidiaries shall be classified as a Restricted Subsidiary.

(b) The Borrower may designate, by written notification thereof to the
Administrative Agent, any Restricted Subsidiary, including a newly formed or
newly acquired Subsidiary, as an Unrestricted Subsidiary if (i) prior, and
immediately after giving effect, to such designation (including after giving
effect to the reclassification of any Investments in, Indebtedness of, and/or
Liens on the assets of, such Subsidiary), no Default or Event of Default exists,
(ii) such designation is deemed to be an Investment in an Unrestricted
Subsidiary in an amount equal to the fair market value as of the date of such
designation of the Borrower’s direct and indirect ownership interest in such
Subsidiary and such Investment would be permitted to be made at the time of such
designation under Section 7.03, (iii) immediately after giving effect to such
designation, the Total Outstandings shall not exceed the lesser of (x) the
aggregate Commitments of the Lenders and (y) the Borrowing Base (after giving
effect to the removal from the Borrowing Base of any of such Restricted
Subsidiary’s Accounts which were included in the Borrowing Base immediately
prior to such designation), and (iv) such Subsidiary is not a “restricted
subsidiary” or guarantor with respect to the Senior Notes Documents nor a
Permitted Water Subsidiary. Except as provided in this Section 6.19(b), no
Restricted Subsidiary may be designated or redesignated as an Unrestricted
Subsidiary.

(c) The Borrower may designate any Unrestricted Subsidiary to be a Restricted
Subsidiary if after giving effect to such designation, (i) the representations
and warranties of the Loan Parties and such Restricted Subsidiary contained in
each of the Loan Documents with respect to such Restricted Subsidiary are true
and correct in all material respects on and as of such date as if made on and as
of the date of such redesignation (or, if stated to have been made expressly as
of an earlier date, were true and correct as of such date), (ii) no Default
would be caused by such designation, and (iii) the applicable Loan Party and
such Restricted Subsidiary each comply with the applicable requirements under
Section 6.12, at which time such Subsidiary shall cease to be an “Unrestricted
Subsidiary” and shall become a “Restricted Subsidiary” for purposes of this
Agreement and the other Loan Documents without any amendment, modification or
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supplement to any of the foregoing. Any such designation shall be treated as a
recovery of the applicable Loan Party’s Investment in such Unrestricted
Subsidiary in an amount equal to the lesser of the fair market value at such
time of the applicable Loan Party’s direct and indirect ownership interest in
such Subsidiary or the amount of the applicable Loan Party’s Investment
previously made in (and not previously recovered from) such Unrestricted
Subsidiary.

(d) The Loan Parties:

(i) will cause the management, business and affairs of the Borrower and its
Restricted Subsidiaries to be conducted in such a manner (including, without
limitation, by keeping separate books of account, furnishing separate balance
sheets and income statements of Unrestricted Subsidiaries to creditors and
potential creditors thereof (to the extent required hereunder) and by not
permitting assets of Unrestricted Subsidiaries to be commingled with those of
the Loan Parties) so that each Unrestricted Subsidiary will be treated as an
entity separate and distinct from the Borrower and its Restricted Subsidiaries;

(ii) will cause each Unrestricted Subsidiary to refrain from maintaining its
assets in such a manner that would make it costly or difficult to segregate,
ascertain or identify as its individual assets from those of any other Loan
Party;

(iii) will not, and will not permit any other Loan Party to, incur, assume,
guarantee or be or become liable for any Indebtedness of any of the Unrestricted
Subsidiaries except to the extent permitted by this Agreement; and

(iv) the Loan Parties will not permit any Unrestricted Subsidiary to hold any
Equity Interest in, or any Indebtedness of, any Loan Party or any Restricted
Subsidiary.

ARTICLE VII

NEGATIVE COVENANTS

So long as any Lender shall have any Commitment hereunder, any Loan or other
Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, the Borrower shall not, nor shall it permit any
Restricted Subsidiary to, directly or indirectly:

7.01 Liens. Create, incur, assume or suffer to exist any Lien upon any of its
property, assets or revenues, whether now owned or hereafter acquired, or sign
or file or suffer to exist under the Uniform Commercial Code of any jurisdiction
a financing statement that names the Borrower or any of its Restricted
Subsidiaries as debtor, or assign any accounts or other right to receive income,
other than the following:

(a) Liens pursuant to any Loan Document;

(b) Liens existing on the date hereof and listed on Schedule 7.01 and any
renewals or extensions thereof, provided that (i) the property covered thereby
is not changed, (ii) the amount secured or benefited thereby is not increased
except as contemplated by Section 7.02(d), (iii) the direct or any contingent
obligor with respect thereto is not changed, and (iv) any renewal or extension
of the obligations secured or benefited thereby is permitted by Section 7.02(d);

 

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(c) Liens for Taxes not yet due or which are being contested in good faith and
by appropriate proceedings diligently conducted, if adequate reserves with
respect thereto are maintained on the books of the applicable Person in
accordance with GAAP;

(d) carriers’, landlord’s, warehousemen’s, mechanics’, materialmen’s,
repairmen’s, laborer’s, or other like Liens arising in the ordinary course of
business which do not secure Indebtedness for borrowed money and which are not
overdue for a period of more than 30 days or which are being contested in good
faith and by appropriate proceedings diligently conducted, if adequate reserves
with respect thereto are maintained on the books of the applicable Person;

(e) pledges or deposits in the ordinary course of business in connection with
workers’ compensation, self-insurance obligations, unemployment insurance and
other social security legislation, other than any Lien imposed by ERISA;

(f) deposits to secure the performance of bids, trade contracts and leases
(other than Indebtedness), statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature incurred in the
ordinary course of business;

(g) easements, rights-of-way, restrictions and other similar encumbrances
affecting real property which, in the aggregate, are not substantial in amount,
and which do not in any case materially detract from the value of the property
subject thereto or materially interfere with the ordinary conduct of the
business of the applicable Person;

(h) Liens securing judgments for the payment of money not constituting an Event
of Default under Section 8.01(h);

(i) Liens securing Indebtedness permitted under Section 7.02(f), including such
Liens outstanding on the date hereof; provided that (i) such Liens do not at any
time encumber any property other than the property financed by such Indebtedness
and (ii) the Indebtedness secured thereby does not exceed the cost or fair
market value, whichever is lower, of the property being acquired on the date of
acquisition;

(j) Leases with respect to the assets or properties of any of the Borrower or
any Restricted Subsidiary, in each case entered into in the ordinary course of
such Person’s business so long as such leases do not apply to Collateral or are
subordinate in all respects to the Liens granted and evidenced by the Collateral
Documents and do not, individually or in the aggregate, (i) interfere in any
material respect with the ordinary conduct of the business of the Borrower or
any Restricted Subsidiary or (ii) materially impair the use (for its intended
purposes) or the value of the property subject thereto;

(k) Liens arising out of conditional sale, title retention, consignment or
similar arrangements for the sale of goods entered into by the Borrower or any
Restricted Subsidiary in the ordinary course of business in accordance with the
past practices of such Person;

(l) Liens on property of the Borrower and the Guarantors not constituting
Collateral securing Indebtedness permitted under Section 7.02(g);

 

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(m) Liens on property of a Person not constituting Collateral existing at the
time such Person is acquired or merged into or consolidated with the Borrower or
any Guarantor or becomes a Restricted Subsidiary of the Borrower; provided that
such Liens were not created in contemplation of such merger, consolidation or
Investment and do not extend to any assets other than those of the Person merged
into or consolidated with the Borrower or such Guarantor or acquired by the
Borrower or such Guarantor, and the applicable Indebtedness secured by such Lien
is permitted under Section 7.02(j);

(n) rights of setoff or bankers’ liens upon deposits of funds in favor of banks
or other depository institutions, solely to the extent incurred in connection
with the maintenance of such deposit accounts in the ordinary course of
business;

(o) Liens solely on any cash earnest money deposits made by a Loan Party in
connection with any letter of intent or purchase agreement with respect to a
Permitted Acquisition; and

(p) other Liens securing Indebtedness outstanding in an aggregate principal
amount not to exceed $2,000,000, provided that no such Liens shall extend to or
cover any Collateral.

7.02 Indebtedness. Create, incur, assume or suffer to exist any Indebtedness,
except:

(a) obligations (contingent or otherwise) existing or arising under any interest
rate Swap Contract, provided that (i) such obligations are (or were) entered
into by such Person to hedge against (including cap, collar, or exchange)
interest rates or foreign exchange rates, which are incurred in the ordinary
course of business and not for speculative purposes and (ii) such Swap Contract
does not contain any provision exonerating the non-defaulting party from its
obligation to make payments on outstanding transactions to the defaulting party;

(b) Indebtedness among the Borrower and its wholly owned Restricted
Subsidiaries, which Indebtedness shall (i) be on terms (including subordination
terms) acceptable to the Administrative Agent and (ii) be otherwise permitted
under the provisions of Section 7.03;

(c) Indebtedness under the Loan Documents;

(d) Indebtedness outstanding on the date hereof and listed on Schedule 7.02 and
any refinancings, renewals or extensions, in whole or in part, of the foregoing;
provided that (i) the amount of such Indebtedness is not increased at the time
of such refinancing, refunding, renewal, or extension except by an amount equal
to a reasonable premium or other reasonable amount paid, and fees and expenses
reasonably incurred, in connection with such refinancing, refunding, renewal, or
extension, (ii) the stated maturity date of such refinancing, refunding,
renewing or extending Indebtedness is no earlier than six months after the
Maturity Date, and (iii) the refinanced debt is retired in full on the issuance
date of the refinancing debt;

(e) Guarantees of the Borrower or any Restricted Subsidiary in respect of
Indebtedness otherwise permitted hereunder of the Borrower or any Guarantor;

 

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(f) Indebtedness in respect of Capitalized Leases, Synthetic Lease Obligations
and purchase money obligations for fixed or capital assets within the
limitations set forth in Section 7.01(i); provided, however, that the aggregate
amount of all such Indebtedness at any one time outstanding (including any such
Indebtedness outstanding on the date hereof) shall not exceed the greater of (i)
$90,000,000 and (ii) 15% of Consolidated Tangible Assets of the Borrower and its
Restricted Subsidiaries as of the end of the fiscal quarter most recently ended;

(g) (i) the Senior Notes in an aggregate principal amount not to exceed
$300,000,000 issued by the Borrower, and (ii) any refinancings, refundings,
renewals or extensions thereof, provided with respect to this clause (ii) that
(A) the amount of such Indebtedness is not increased at the time of such
refinancing, refunding, renewal, or extension except by an amount equal to a
reasonable premium or other reasonable amount paid, and fees and expenses
reasonably incurred, in connection with such refinancing, refunding, renewal, or
extension, (B) immediately prior to and after giving effect to the issuance of
such Indebtedness, there would be no Default under this Agreement, (C) such
Indebtedness’ scheduled maturity is no earlier than ninety-one (91) days after
the Maturity Date, (D) such Indebtedness does not require any scheduled
repayments, defeasance or redemption (or sinking fund therefor) of any principal
amount thereof prior to maturity; provided that, for the avoidance of doubt,
this clause (D) shall not prohibit customary high yield indenture provisions
requiring offers to repurchase in connection with asset sales (such offer not
exceeding 100% of the outstanding principal balance of such Indebtedness) or any
change of control (such offer not exceeding 101% of the outstanding principal
balance of such Indebtedness) and provisions regarding prepayment from the net
cash proceeds of certain debt issuances, casualty events, extraordinary
receipts, tax receipts and equity issuances, in each case, only to the extent
not required to be applied first to the Obligations pursuant to the terms of the
Loan Documents, (E) no indenture or other agreement governing such Indebtedness
contains (1) maintenance financial covenants or (2) covenants or events of
default that are more restrictive in any material respect on the Borrower or any
of its Restricted Subsidiaries than then applicable market terms and conditions
for comparable issuers and issuances, and (F) if secured, such Indebtedness
shall not be secured by any of the Collateral and the administrative agent or
trustee therefor shall have entered into a Collateral Rights Agreement with the
Administrative Agent in form and substance satisfactory to it.

(h) Indebtedness in respect of workers’ compensation claims, self-insurance
obligations, performance bonds, surety appeal or similar bonds and completion
guarantees provided by the Borrower or a Restricted Subsidiary in the ordinary
course of its business;

(i) Indebtedness in respect of (i) self-insurance obligations or completion,
bid, performance, appeal or surety bonds issued for the account of the Borrower
or any wholly-owned Restricted Subsidiary in the ordinary course of business,
including guarantees or obligations of the Borrower or any wholly-owned
Restricted Subsidiary with respect to letters of credit supporting such
self-insurance, completion, bid, performance, appeal or surety obligations (in
each case other than for an obligation for money borrowed) or (ii) obligations
represented by letters of credit for the account of the Borrower or any
wholly-owned Restricted Subsidiary, as the case may be, in order to provide
security for workers’ compensation claims;

(j) indemnification, adjustment of purchase price, earn-out or similar
obligations (including without limitation any Earn Out Obligations), in each
case, incurred or assumed in connection with any Permitted Acquisition or
disposition of any business or assets of the Borrower or any wholly-owned
Restricted Subsidiary or Equity Interests of a wholly-owned Restricted

 

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Subsidiary, other than guarantees of Indebtedness incurred by any person
acquiring all or any portion of such business, assets or Equity Interests for
the purpose of financing or in contemplation of any such Permitted Acquisition;
provided that (i) any amount of such obligations included on the face of the
balance sheet of the Borrower or any wholly-owned Restricted Subsidiary shall
not be permitted under this clause (j) unless such obligation arises with
respect to a Permitted Acquisition approved by all Lenders and (ii) in the case
of a disposition, the maximum aggregate liability in respect of all such
obligations outstanding under this clause (j) shall at no time exceed the gross
proceeds actually received by the Borrower and the wholly-owned Restricted
Subsidiaries in connection with such disposition;

(k) Indebtedness of any Person that becomes a Restricted Subsidiary of the
Borrower as a result of a Permitted Acquisition in an aggregate principal amount
not to exceed $15,000,000 at any time outstanding; provided that such
Indebtedness is existing at the time such Person becomes a Restricted Subsidiary
of the Borrower and was not incurred solely in contemplation of such Person’s
becoming a Restricted Subsidiary of the Borrower;

(l) endorsements of negotiable instruments for collection in the ordinary course
of business; and

(m) unsecured Indebtedness not otherwise permitted under this Section 7.02 in an
aggregate principal amount not to exceed $5,000,000 at any time outstanding.

7.03 Investments. Make or hold any Investments, except:

(a) Investments held by the Borrower and its Restricted Subsidiaries in the form
of Cash Equivalents;

(b) advances to officers, directors and employees of the Borrower and its
Restricted Subsidiaries in an aggregate amount not to exceed $250,000 at any
time outstanding, for travel, entertainment, relocation and analogous ordinary
business purposes;

(c) (i) Investments by the Borrower and its Restricted Subsidiaries in their
respective Restricted Subsidiaries outstanding on the date hereof,
(ii) additional Investments by the Borrower and its Restricted Subsidiaries in
Loan Parties, including, for the avoidance of doubt, Investments in Permitted
Water Subsidiaries so long as such Permitted Water Subsidiary is a Guarantor at
the time of such Investment, (iii) additional Investments by Restricted
Subsidiaries of the Borrower that are not Loan Parties in other Restricted
Subsidiaries that are not Loan Parties and (iv) so long as no Default has
occurred and is continuing or would result from such Investment, additional
Investments by the Loan Parties in wholly-owned Restricted Subsidiaries that are
not Loan Parties in an aggregate amount invested from the date hereof not to
exceed $1,000,000;

(d) Investments consisting of extensions of credit in the nature of accounts
receivable or notes receivable arising from the grant of trade credit in the
ordinary course of business, and Investments received in satisfaction or partial
satisfaction thereof from financially troubled account debtors to the extent
reasonably necessary in order to prevent or limit loss;

(e) Guarantees permitted by Section 7.02;

 

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(f) Investments existing on the date hereof (other than those referred to in
Section 7.03(c)(i)) and identified on Schedule 7.03 or otherwise set forth on
Schedule 7.03;

(g) the Borrower and the Guarantors may (by purchase or merger) consummate
Permitted Acquisitions; provided that, in the case of a merger or consolidation,
the Borrower or a Guarantor, as applicable, is the surviving entity;

(h) the Borrower may make loans to senior management of Borrower and the
Guarantors for purposes of purchasing the capital stock of Borrower in an
aggregate principal amount not to exceed $250,000 at any one time outstanding;

(i) scheduled payments of Earn Out Obligations; provided that the Payment
Conditions with respect to Acquisitions are satisfied before and after giving
effect to such payment; and

(j) other Investments not exceeding (i) $2,500,000 in the aggregate in any
fiscal year of the Borrower and (ii) $5,000,000 in the aggregate following the
Closing Date.

7.04 Fundamental Changes. Merge, dissolve, liquidate, consolidate with or into
another Person, or Dispose of (whether in one transaction or in a series of
transactions) all or substantially all of its assets (whether now owned or
hereafter acquired) to or in favor of any Person, except that, so long as no
Default exists or would result therefrom:

(a) (i) the Borrower may merge with one or more of its Restricted Subsidiaries,
provided that the Borrower shall be the continuing or surviving Person, and
(ii) any of its Restricted Subsidiaries may merge with any of its other
Restricted Subsidiaries provided that if any of such Restricted Subsidiaries is
a Guarantor, a Guarantor shall be the surviving Person;

(b) any Guarantor may Dispose of all or substantially all of its assets (upon
voluntary liquidation or otherwise) to the Borrower or to another Guarantor;

(c) any Restricted Subsidiary that is not a Guarantor may dispose of all or
substantially all its assets (including any Disposition that is in the nature of
a liquidation) (i) to the Borrower or another Restricted Subsidiary that is not
a Loan Party or (ii) to a Loan Party; and

(d) the Borrower or any Guarantor may merge or consolidate with any Person in
accordance with Section 7.03(g).

7.05 Dispositions. Make any Disposition or enter into any agreement to make any
Disposition, except:

(a) Dispositions of (i) obsolete or worn out property and (ii) equipment that is
no longer useful in the ordinary course of business, in each case, whether now
owned or hereafter acquired;

(b) Dispositions of inventory in the ordinary course of business;

(c) Dispositions of property by any Restricted Subsidiary to the Borrower, to
any wholly-owned Restricted Subsidiary or to any Permitted Water Subsidiary;
provided that if the transferor of such property is a Guarantor, the transferee
thereof must either be the Borrower or a Guarantor;

 

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(d) Dispositions permitted by Section 7.04;

(e) Dispositions by the Borrower and its Restricted Subsidiaries not otherwise
permitted under this Section 7.05; provided that (i) at the time of such
Disposition, no Default shall exist or would result from such Disposition,
(ii) the aggregate book value of all property Disposed of in reliance on this
clause (f) in any fiscal year shall not exceed $25,000,000 (or such greater
amount as may be approved by the Administrative Agent in its Permitted
Discretion), (iii) the assets subject to such Disposition do not constitute
Collateral, and (iv) at least 75% of the purchase price for such asset shall be
paid to the Borrower or such Restricted Subsidiary in cash; and

(f) sales or non-exclusive grants of licenses or sublicenses to use the patents,
trade secrets, know-how and other intellectual property, and licenses, leases or
subleases of other assets, of the Borrower or any wholly-owned Restricted
Subsidiary to the extent not materially interfering with the business of the
Borrower or any Restricted Subsidiary.

provided, however, that any Disposition pursuant to Section 7.05(a) through
Section 7.05(f) (other than Dispositions to a Loan Party) shall be for fair
market value.

7.06 Restricted Payments. Declare or make, directly or indirectly, any
Restricted Payment, or incur any obligation (contingent or otherwise) to do so,
except that:

(a) each Restricted Subsidiary (other than a Permitted Water Subsidiary) may
make Restricted Payments to the Borrower, any Restricted Subsidiaries of the
Borrower that are Guarantors and any other Person that owns a direct Equity
Interest in such Restricted Subsidiary, ratably according to their respective
holdings of the type of Equity Interest in respect of which such Restricted
Payment is being made;

(b) the Borrower and each Restricted Subsidiary may declare and make dividend
payments or other distributions payable solely in the common stock or other
common Equity Interests of such Person;

(c) the Borrower and each Restricted Subsidiary may purchase, redeem or
otherwise acquire its common Equity Interests with the proceeds received from
the substantially concurrent issue of new common Equity Interests;

(d) so long as the applicable Payment Conditions are satisfied before and after
giving effect thereto, the Borrower or any Permitted Water Subsidiary may
(i) declare or pay cash dividends to its stockholders or equity holders and
(ii) purchase, redeem or otherwise acquire for cash Equity Interests issued by
it;

(e) so long as no Default shall have occurred and be continuing at the time of
any such action or would result therefrom, the redemption, repurchase or other
acquisition or retirement for value of Equity Interests of the Borrower held by
officers, directors or employees or former officers, directors or employees (or
their transferees, estates or beneficiaries under their estates), either
(i) upon any such individual’s death, disability, retirement, severance or
termination of

 

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employment or service or (ii) pursuant to any equity subscription agreement,
stock option agreement, stockholders’ agreement or similar agreement; provided,
in any case, that the aggregate cash consideration paid for all such
redemptions, repurchases or other acquisitions or retirements shall not exceed
$2,000,000 during any calendar year (with unused amounts in any calendar year
being carried forward to the next succeeding calendar year);

(f) so long as no Default shall have occurred and be continuing at the time of
any such action or would result therefrom, (i) repurchases, redemptions or other
acquisitions or retirements for value of Equity Interests deemed to occur upon
the exercise of stock options, warrants, rights to acquire Equity Interests or
other convertible securities to the extent such Equity Interests represent a
portion of the exercise or exchange price thereof and (ii) any repurchases,
redemptions or other acquisitions or retirements for value of Equity Interests
made in lieu of withholding Taxes in connection with any exercise or exchange of
stock options, warrants or other similar rights;

(g) the payment of cash in lieu of fractional Equity Interests; and

(h) so long as no Default shall have occurred and be continuing at the time of
any such action or would result therefrom, payments or distributions to
dissenting stockholders pursuant to applicable Law in connection with a merger,
consolidation or transfer of assets that complies with the provisions of
Section 7.04.

7.07 Change in Nature of Business. Engage in any material line of business
substantially different from those lines of business conducted by the Borrower
and its Restricted Subsidiaries on the Closing Date, any other business or
businesses in the oilfield services industry and other businesses reasonably
related or ancillary thereto.

7.08 Transactions with Affiliates. Enter into any transaction of any kind with
any Affiliate of the Borrower, whether or not in the ordinary course of
business, other than on fair and reasonable terms substantially as favorable to
the Borrower or such Restricted Subsidiary as would be obtainable by the
Borrower or such Restricted Subsidiary at the time in a comparable arm’s length
transaction with a Person other than an Affiliate; provided that the foregoing
restriction shall not apply to (a) transactions solely between or among the Loan
Parties, (b) compensation to, and the terms of any employment contracts with,
individuals who are officers, managers or directors of the Loan Parties in the
ordinary course of business, provided that, to the extent such approval is
required, such compensation is approved by such Loan Party’s board of directors
(or equivalent governing body), (c) any issuances of securities or other
payments, awards or grants in cash, securities or otherwise pursuant to, or the
funding of, employment agreements, stock options and stock ownership plans in
each case, as permitted by this Agreement or (d) Restricted Payments permitted
pursuant to Section 7.06.

7.09 Burdensome Agreements. Enter into or permit to exist any Contractual
Obligation (other than this Agreement, any other Loan Document or any Senior
Notes Document) that (a) limits the ability (i) of any Restricted Subsidiary to
make Restricted Payments to the Borrower or any Guarantor or to otherwise
transfer property to or invest in the Borrower or any Guarantor, except for any
agreement in effect (A) on the date hereof and set forth on Schedule 7.09 or
(B) at the time any Person becomes a Restricted Subsidiary of the Borrower, so
long as such agreement was not entered into solely in contemplation of such
Person becoming a Restricted

 

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Subsidiary of the Borrower, (ii) of any Restricted Subsidiary to Guarantee the
Obligations or (iii) of the Borrower or any Restricted Subsidiary to create,
incur, assume or suffer to exist Liens on its property to secure the
Obligations; provided, however, that (x) this clause (iii) shall not prohibit
any negative pledge incurred or provided in favor of any holder of Indebtedness
permitted under Section 7.02(f) solely to the extent any such negative pledge
relates to the property financed by or the subject of such Indebtedness or
customary restrictions on assignment, encumbrances or subletting in leases and
other contracts and (y) this clause (iii) and the preceding clause (i) shall not
prohibit customary restrictions and conditions contained in agreements relating
to the sale of a Loan Party or an asset pending such sale, provided that such
restrictions and conditions apply only to such Loan Party or such asset that is
to be sold and such sale is permitted under this Agreement; or (b) requires the
grant of a Lien to secure an obligation of such Person if a Lien is granted to
secure the Obligations.

7.10 Use of Proceeds. Use the proceeds of any Credit Extension, whether directly
or indirectly, and whether immediately, incidentally or ultimately, to purchase
or carry margin stock (within the meaning of Regulation U of the FRB) or to
extend credit to others for the purpose of purchasing or carrying margin stock
or to refund indebtedness originally incurred for such purpose.

7.11 Consolidated Fixed Charge Coverage Ratio. Permit the Consolidated Fixed
Charge Coverage Ratio as of the end of any Measurement Period to be less than
1.00 to 1.00 while a Financial Covenant Trigger Period is in effect, commencing
with the most recent Measurement Period for which financial statements were, or
were required to be, delivered hereunder prior to the commencement of the
Financial Covenant Trigger Period.

7.12 Amendments of Organization Documents. Amend any of its Organization
Documents in a manner which could materially and adversely affect the interests
of the Administrative Agent or the Lenders.

7.13 Accounting Changes. Make any change in (a) its accounting policies or
reporting practices, except as required by GAAP, or (b) its fiscal year.

7.14 Prepayments, Etc. of Indebtedness. Prepay, redeem, purchase, defease or
otherwise satisfy prior to the scheduled maturity thereof in any manner, or make
any payment in violation of any subordination terms of, any Indebtedness, except
(a) the prepayment of the Credit Extensions in accordance with the terms of this
Agreement, (b) regularly scheduled payments of principal of Indebtedness set
forth on Schedule 7.02, (c) mandatory prepayments or redemptions of the Senior
Notes as required under the Senior Notes Indenture as in effect on the date
hereof, (d) refinancings, refundings, extensions or renewals of Indebtedness to
the extent such refinancing, refunding, extension or renewal is permitted by
Sections 7.02(d) or 7.02(g)(ii), as applicable, (e) the conversion to or
exchange for Equity Interests of convertible or exchangeable debt securities,
and customary payments in cash in lieu of fractional shares in connection
therewith, and (f) other prepayments or redemptions with respect to Indebtedness
not otherwise permitted pursuant to this Section 7.14; provided that, in the
case of this clause (f), the applicable Payment Conditions are satisfied before
and after giving effect thereto.

 

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7.15 Amendment, Etc. of Indebtedness.

(a) Amend, modify or change in any manner any term or condition of the Senior
Notes or the Senior Notes Documents or any Indebtedness set forth on Schedule
7.02, except for (i) any refinancing, refunding, renewal or extension thereof
permitted by Sections 7.02(d) or 7.02(g)(ii), as applicable, (ii) with respect
to the Senior Notes and the Senior Notes Documents, (A) any amendments or
modifications made to (1) cure any ambiguity, defect or inconsistency, or
(2) evidence or provide for the acceptance of appointment by a successor trustee
or effect any similar immaterial administrative modifications, or (B) any other
amendment, modification or change thereto, provided that (x) the terms of such
amendment, modification or change satisfy the requirements of the proviso of
Section 7.02(g)(ii) and (y) such amendment, modification or change could not
materially and adversely affect the interests of the Administrative Agent or the
Lenders under the Loan Documents.

(b) Fail to maintain the Loan Parties’ ability to incur the full amount of the
Aggregate Commitments and Obligations as “Permitted Debt” under the Senior Notes
Indenture with an additional ten percent (10%) available thereunder for
increases in the Aggregate Commitments (and the ability to incur Liens securing
the same).

7.16 Sanctions. Directly or indirectly, use any Credit Extension or the proceeds
of any Credit Extension, or lend, contribute or otherwise make available such
Credit Extension or the proceeds of any Credit Extension to any Person, to fund
any activities of or business with any Person, or in any Designated
Jurisdiction, that, at the time of such funding, is the subject of Sanctions, or
in any other manner that will result in a violation by any Person (including any
Person participating in the transaction, whether as Lender, Arranger,
Administrative Agent, L/C Issuer, Swing Line Lender, or otherwise) of Sanctions.

ARTICLE VIII

EVENTS OF DEFAULT AND REMEDIES

8.01 Events of Default. Any of the following shall constitute an Event of
Default:

(a) Non-Payment. The Borrower or any other Loan Party fails to (i) pay when and
as required to be paid herein, any amount of principal of any Loan or any L/C
Obligation or deposit any funds as Cash Collateral in respect of L/C
Obligations, or (ii) pay within three days after the same becomes due, any
interest on any Loan or on any L/C Obligation, or any fee due hereunder, or
(iii) pay within five days after the same becomes due, any other amount payable
hereunder or under any other Loan Document; or

(b) Specific Covenants. (i) The Borrower fails to perform or observe any term,
covenant or agreement contained in any of Section 6.01, 6.02(a), 6.02(b),
6.03(a), 6.03(b), 6.05, 6.07, 6.10, 6.11, 6.12, 6.14, 6.19 or Article VII or
(ii) the Borrower fails to perform or observe any term, covenant or agreement
contained in Section 6.02 (other than Section 6.02(a) and 6.02(b)) or
Section 6.03 (other than Section 6.03(a) and 6.03(b)) and such failure continues
for 5 days; or

(c) Other Defaults. Any Loan Party fails to perform or observe any other
covenant or agreement (not specified in Section 8.01(a) or (b) above) contained
in any Loan Document on its part to be performed or observed and such failure
continues for 30 days; or

 

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(d) Representations and Warranties. Any representation, warranty, certification
or statement of fact made or deemed made by or on behalf of the Borrower or any
other Loan Party herein, in any other Loan Document, or in any document
delivered in connection herewith or therewith shall be incorrect or misleading
in any material respect when made or deemed made; or

(e) Cross-Default. (i) Any Loan Party or any Restricted Subsidiary thereof
(A) fails to make any payment when due (whether by scheduled maturity, required
prepayment, acceleration, demand, or otherwise) in respect of any Indebtedness
or Guarantee (other than Indebtedness hereunder and Indebtedness under Swap
Contracts) having an aggregate principal amount (including undrawn committed or
available amounts and including amounts owing to all creditors under any
combined or syndicated credit arrangement) of more than $15,000,000 (including
the Senior Notes), or (B) fails to observe or perform any other agreement or
condition relating to any such Indebtedness (other than secured Indebtedness
that becomes due as a result of the voluntary sale or transfer, casualty or
condemnation of the assets securing such Indebtedness) or Guarantee or contained
in any instrument or agreement evidencing, securing or relating thereto, or any
other event occurs, the effect of which default or other event under this clause
(B) is to cause, or to permit the holder or holders of such Indebtedness or the
beneficiary or beneficiaries of such Guarantee (or a trustee or agent on behalf
of such holder or holders or beneficiary or beneficiaries) to cause, with the
giving of notice if required, such Indebtedness to be demanded or to become due
or to be repurchased, prepaid, defeased or redeemed (automatically or
otherwise), or an offer to repurchase, prepay, defease or redeem such
Indebtedness to be made, prior to its stated maturity, or such Guarantee to
become payable or cash collateral in respect thereof to be demanded; or
(ii) there occurs under any Swap Contract an Early Termination Date (as defined
in such Swap Contract) resulting from (A) any event of default under such Swap
Contract as to which a Loan Party or any Subsidiary thereof is the Defaulting
Party (as defined in such Swap Contract) or (B) any Termination Event (as so
defined) under such Swap Contract as to which a Loan Party or any Subsidiary
thereof is an Affected Party (as so defined) and, in either event, the Swap
Termination Value owed by such Loan Party or such Subsidiary as a result thereof
is greater than $15,000,000; or

(f) Insolvency Proceedings, Etc. Any Loan Party or any Restricted Subsidiary
thereof institutes or consents to the institution of any proceeding under any
Debtor Relief Law, or makes an assignment for the benefit of creditors; or
applies for or consents to the appointment of any receiver, trustee, custodian,
conservator, liquidator, rehabilitator or similar officer for it or for all or
any material part of its property; or any receiver, trustee, custodian,
conservator, liquidator, rehabilitator or similar officer is appointed without
the application or consent of such Person and the appointment continues
undischarged or unstayed for 60 calendar days; or any proceeding under any
Debtor Relief Law relating to any such Person or to all or any material part of
its property is instituted without the consent of such Person and continues
undismissed or unstayed for 60 calendar days, or an order for relief is entered
in any such proceeding; or

(g) Inability to Pay Debts; Attachment. (i) Any Loan Party or any Restricted
Subsidiary thereof becomes unable or admits in writing its inability or fails
generally to pay its debts as they become due, or (ii) any writ or warrant of
attachment or execution or similar process is issued or levied against all or
any material part of the property of any such Person and is not released,
vacated or fully bonded within 30 days after its issue or levy; or

 

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(h) Judgments. There is entered against any Loan Party or any Restricted
Subsidiary thereof (i) one or more final judgments or orders for the payment of
money in an aggregate amount (as to all such judgments and orders) exceeding
$5,000,000 (to the extent not covered by independent third-party insurance as to
which the insurer is rated at least “A” by A.M. Best Company, has been notified
of the potential claim and does not dispute coverage), or (ii) any one or more
non-monetary final judgments that have, or could reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect and, in either case,
(A) enforcement proceedings are commenced by any creditor upon such judgment or
order, or (B) there is a period of 10 consecutive days during which a stay of
enforcement of such judgment, by reason of a pending appeal or otherwise, is not
in effect; or

(i) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan or
Multiemployer Plan which has resulted or could reasonably be expected to result
in a Material Adverse Effect or the imposition of a Lien on the assets of a Loan
Party, or (ii) the Borrower or any ERISA Affiliate fails to pay when due, after
the expiration of any applicable grace period, any installment payment with
respect to its withdrawal liability under Section 4201 of ERISA under a
Multiemployer Plan and such failure to pay has resulted or could reasonably be
expected to result in a Material Adverse Effect or the imposition of a Lien on
the assets of a Loan Party; or

(j) Invalidity of Loan Documents. Any provision of any Loan Document, at any
time after its execution and delivery and for any reason other than as expressly
permitted hereunder or thereunder or satisfaction in full of all the
Obligations, ceases to be in full force and effect; or any Loan Party or any
other Person contests in any manner the validity or enforceability of any
provision of any Loan Document; or any Loan Party denies that it has any or
further liability or obligation under any provision of any Loan Document, or
purports to revoke, terminate or rescind any provision of any Loan Document; or

(k) Change of Control. There occurs any Change of Control; or

(l) Collateral Documents. Any Collateral Document after delivery thereof
pursuant to Section 4.01 or 6.12 shall for any reason (other than pursuant to
the terms thereof) cease to create a valid and perfected first priority Lien
(subject to Liens permitted by Section 7.01) on Collateral consisting of
Accounts of the type included in the Borrowing Base or other Collateral having
an aggregate fair market value in excess of $5,000,000 that is purported to be
covered thereby unless such occurrence results solely from action of the
Administrative Agent or any Lender and involves no Default by the Borrower or
any Guarantor hereunder or under any Collateral Document.

8.02 Remedies upon Event of Default. If any Event of Default occurs and is
continuing, the Administrative Agent shall, at the request of, or may, with the
consent of, the Required Lenders, take any or all of the following actions:

(a) declare the commitment of each Lender to make Loans and any obligation of
each L/C Issuer to make L/C Credit Extensions to be terminated, whereupon such
commitments and obligation shall be terminated;

(b) declare the unpaid principal amount of all outstanding Loans, all interest
accrued and unpaid thereon, and all other amounts owing or payable hereunder or
under any other Loan Document to be immediately due and payable, without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Borrower;

 

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(c) require that the Borrower Cash Collateralize the L/C Obligations (in an
amount equal to the then Outstanding Amount thereof); and

(d) exercise on behalf of itself, the Lenders and the L/C Issuers all rights and
remedies available to it, the Lenders and the L/C Issuers under the Loan
Documents or applicable Law or equity;

provided, however, that upon the occurrence of an actual or deemed entry of an
order for relief with respect to the Borrower under the Bankruptcy Code of the
United States, the obligation of each Lender to make Loans and any obligation of
each L/C Issuer to make L/C Credit Extensions shall automatically terminate, the
unpaid principal amount of all outstanding Loans and all interest and other
amounts as aforesaid shall automatically become due and payable, and the
obligation of the Borrower to Cash Collateralize the L/C Obligations as
aforesaid shall automatically become effective, in each case without further act
of the Administrative Agent or any Lender.

8.03 Application of Funds. After the exercise of remedies provided for in
Section 8.02 (or after the Loans have automatically become immediately due and
payable and the L/C Obligations have automatically been required to be Cash
Collateralized as set forth in the proviso to Section 8.02), any amounts
received on account of the Obligations shall, subject to the provisions of
Sections 2.15 and 2.16, be applied by the Administrative Agent in the following
order:

First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including fees, charges and
disbursements of counsel to the Administrative Agent and amounts payable under
Article III) payable to the Administrative Agent in its capacity as such and to
the payment of Protective Advances;

Second, to payment of that portion of the Obligations constituting fees,
indemnities and other amounts (other than principal, interest and Letter of
Credit Fees) payable to the Lenders and the L/C Issuers (including fees, charges
and disbursements of counsel to the respective Lenders and L/C Issuers arising
under the Loan Documents and amounts payable under Article III), ratably among
them in proportion to the respective amounts described in this clause Second
payable to them;

Third, to payment of that portion of the Obligations constituting accrued and
unpaid Letter of Credit Fees and interest on the Loans, L/C Borrowings and other
Obligations arising under the Loan Documents, ratably among the Lenders and the
L/C Issuers in proportion to the respective amounts described in this clause
Third payable to them;

Fourth, to payment of that portion of the Obligations constituting unpaid
principal of the Loans, L/C Borrowings and Secured Bank Product Obligations up
to the amount of the Bank Product Reserve existing therefor and to the
Administrative Agent, for the account of the applicable L/C Issuer, to Cash
Collateralize that portion of L/C Obligations comprised of the aggregate undrawn
amount of Letters of Credit to the extent not otherwise Cash Collateralized by
the Borrower pursuant to Sections 2.03 and 2.15, in each case, ratably among the
Administrative Agent, the Lenders, the L/C Issuers, the Hedge Banks and the Cash
Management Banks in proportion to the respective amounts described in this
clause Fourth held by them;

 

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Fifth, to payment of all other Obligations ratably among the Secured Parties;
and

Last, the balance, if any, after all of the Obligations have been indefeasibly
paid in full, to the Borrower or as otherwise required by Law.

Subject to Section 2.03(c) and 2.15, amounts used to Cash Collateralize the
aggregate undrawn amount of Letters of Credit pursuant to clause Fourth above
shall be applied to satisfy drawings under such Letters of Credit as they occur.
If any amount remains on deposit as Cash Collateral after all Letters of Credit
have either been fully drawn or expired, such remaining amount shall be applied
to the other Obligations, if any, in the order set forth above. Excluded Swap
Obligations with respect to any Guarantor shall not be paid with amounts
received from such Guarantor or its assets, but appropriate adjustments shall be
made with respect to payments from other Loan Parties to preserve the allocation
to Obligations otherwise set forth above in this Section.

Notwithstanding the foregoing, Obligations arising under Secured Cash Management
Agreements and Secured Hedge Agreements shall be excluded from the application
described above if the Administrative Agent has not received a Secured Party
Designation Notice, together with such supporting documentation as the
Administrative Agent may request, from the applicable Cash Management Bank or
Hedge Bank, as the case may be. Each Cash Management Bank or Hedge Bank not a
party to this Agreement that has given the notice contemplated by the preceding
sentence shall, by such notice, be deemed to have acknowledged and accepted the
appointment of the Administrative Agent pursuant to the terms of Article IX
hereof for itself and its Affiliates as if a “Lender” party hereto.

ARTICLE IX

ADMINISTRATIVE AGENT

9.01 Appointment and Authority. (a) Each Secured Party hereby irrevocably
appoints, designates and authorizes Bank of America to act on its behalf as the
Administrative Agent hereunder and under the other Loan Documents and authorizes
the Administrative Agent to take such actions on its behalf and to exercise such
powers as are delegated to the Administrative Agent by the terms hereof or
thereof, together with such actions and powers as are reasonably incidental
thereto. The provisions of this Article are solely for the benefit of the
Administrative Agent, the Lenders and the L/C Issuers, and the Borrower shall
not have rights as a third party beneficiary of any of such provisions. It is
understood and agreed that the use of the term “agent” herein or in any other
Loan Documents (or any other similar term) with reference to the Administrative
Agent is not intended to connote any fiduciary or other implied (or express)
obligations arising under agency doctrine of any applicable Law. Instead such
term is used as a matter of market custom, and is intended to create or reflect
only an administrative relationship between contracting parties.

(b) The Administrative Agent shall also act as the “collateral agent” under the
Loan Documents, and each of the Lenders (including in its capacities as a
potential Hedge Bank and a potential Cash Management Bank) and each of the L/C
Issuers hereby irrevocably appoints and authorizes the Administrative Agent to
act as the agent of such Lender and such L/C Issuer for

 

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purposes of acquiring, holding and enforcing any and all Liens on Collateral
granted by any of the Loan Parties to secure any of the Obligations, together
with such powers and discretion as are reasonably incidental thereto. In this
connection, the Administrative Agent, as “collateral agent” and any co-agents,
sub-agents and attorneys-in-fact appointed by the Administrative Agent pursuant
to Section 9.05 for purposes of holding or enforcing any Lien on the Collateral
(or any portion thereof) granted under the Collateral Documents, or for
exercising any rights and remedies thereunder at the direction of the
Administrative Agent), shall be entitled to the benefits of all provisions of
this Article IX and Article X (including Section 10.04(c), as though such
co-agents, sub-agents and attorneys-in-fact were the “collateral agent” under
the Loan Documents) as if set forth in full herein with respect thereto.

9.02 Rights as a Lender. The Person serving as the Administrative Agent
hereunder shall have the same rights and powers in its capacity as a Lender as
any other Lender and may exercise the same as though it were not the
Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise
expressly indicated or unless the context otherwise requires, include the Person
serving as the Administrative Agent hereunder in its individual capacity. Such
Person and its Affiliates may accept deposits from, lend money to, own
securities of, act as the financial advisor or in any other advisory capacity
for and generally engage in any kind of banking, trust, financial, advisory,
underwriting or other business with the Borrower or any Subsidiary or other
Affiliate thereof as if such Person were not the Administrative Agent hereunder
and without any duty to account therefor to the Lenders or to provide notice to
or consent of the Lenders with respect thereto.

9.03 Exculpatory Provisions. The Administrative Agent shall not have any duties
or obligations except those expressly set forth herein and in the other Loan
Documents, and its duties hereunder shall be administrative in nature. Without
limiting the generality of the foregoing, each of the Administrative Agent and
its Related Parties:

(a) shall not be subject to any fiduciary or other implied duties, regardless of
whether a Default has occurred and is continuing;

(b) shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby or by the other Loan Documents that the Administrative Agent
is required to exercise as directed in writing by the Required Lenders (or such
other number or percentage of the Lenders as shall be expressly provided for
herein or in the other Loan Documents), provided that the Administrative Agent
shall not be required to take any action that, in its opinion or the opinion of
its counsel, may expose the Administrative Agent to liability or that is
contrary to any Loan Document or applicable law, including for the avoidance of
doubt any action that may be in violation of the automatic stay under any Debtor
Relief Law or that may effect a forfeiture, modification or termination of
property of a Defaulting Lender in violation of any Debtor Relief Law; and

(c) shall not, except as expressly set forth herein and in the other Loan
Documents, have any duty or responsibility to disclose, and shall not be liable
for the failure to disclose, any information relating to the Borrower or any of
its Affiliates that is communicated to or obtained by the Person serving as the
Administrative Agent or any of its Affiliates in any capacity.

 

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(d) Neither the Administrative Agent nor any of its Related Parties shall be
liable for any action taken or not taken by the Administrative Agent under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby or thereby (i) with the consent or at the request of the
Required Lenders (or such other number or percentage of the Lenders as shall be
necessary, or as the Administrative Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Sections 10.01 and 8.02) or
(ii) in the absence of its own gross negligence or willful misconduct as
determined by a court of competent jurisdiction by final and nonappealable
judgment. The Administrative Agent shall be deemed not to have knowledge of any
Default unless and until notice describing such Default is given in writing to
the Administrative Agent by the Borrower, a Lender or an L/C Issuer.

(e) Neither the Administrative Agent nor any of its Related Parties have any
duty or obligation to any Lender or participant or any other Person to ascertain
or inquire into (i) any statement, warranty or representation made in or in
connection with this Agreement or any other Loan Document, (ii) the contents of
any certificate, report or other document delivered hereunder or thereunder or
in connection herewith or therewith, (iii) the performance or observance of any
of the covenants, agreements or other terms or conditions set forth herein or
therein or the occurrence of any Default, (iv) the validity, enforceability,
effectiveness or genuineness of this Agreement, any other Loan Document or any
other agreement, instrument or document, or the creation, perfection or priority
of any Lien purported to be created by the Collateral Documents, (v) the value
or the sufficiency of any Collateral, or (vi) the satisfaction of any condition
set forth in Article IV or elsewhere herein, other than to confirm receipt of
items expressly required to be delivered to the Administrative Agent.

9.04 Reliance by Administrative Agent. The Administrative Agent shall be
entitled to rely upon, and shall be fully protected in relying upon and shall
not incur any liability for relying upon, any notice, request, certificate,
communication, consent, statement, instrument, document or other writing
(including any electronic message, Internet or intranet website posting or other
distribution) believed by it to be genuine and to have been signed, sent or
otherwise authenticated by the proper Person. The Administrative Agent also may
rely upon any statement made to it orally or by telephone and believed by it to
have been made by the proper Person, and shall be fully protected in relying and
shall not incur any liability for relying thereon. In determining compliance
with any condition hereunder to the making of a Loan, or the issuance,
extension, renewal or increase of a Letter of Credit, that by its terms must be
fulfilled to the satisfaction of a Lender or an L/C Issuer, the Administrative
Agent may presume that such condition is satisfactory to such Lender or such L/C
Issuer unless the Administrative Agent shall have received notice to the
contrary from such Lender or such L/C Issuer prior to the making of such Loan or
the issuance of such Letter of Credit. The Administrative Agent may consult with
legal counsel (who may be counsel for the Borrower), independent accountants and
other experts selected by it, and shall not be liable for any action taken or
not taken by it in accordance with the advice of any such counsel, accountants
or experts. For purposes of determining compliance with the conditions specified
in Section 4.01, each Lender that has signed this Agreement shall be deemed to
have consented to, approved or accepted or to be satisfied with, each document
or other matter required thereunder to be consented to or approved by or
acceptable or satisfactory to a Lender unless the Administrative Agent shall
have received notice from such Lender prior to the proposed Closing Date
specifying its objections.

 

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9.05 Delegation of Duties. The Administrative Agent may perform any and all of
its duties and exercise its rights and powers hereunder or under any other Loan
Document by or through any one or more sub-agents appointed by the
Administrative Agent. The Administrative Agent and any such sub-agent may
perform any and all of its duties and exercise its rights and powers by or
through their respective Related Parties. The exculpatory provisions of this
Article shall apply to any such sub-agent and to the Related Parties of the
Administrative Agent and any such sub-agent, and shall apply to their respective
activities in connection with the syndication of the credit facilities provided
for herein as well as activities as Administrative Agent. The Administrative
Agent shall not be responsible for the negligence or misconduct of any
sub-agents except to the extent that a court of competent jurisdiction
determines in a final and nonappealable judgment that the Administrative Agent
acted with gross negligence or willful misconduct in the selection of such
sub-agents.

9.06 Resignation of Administrative Agent.

(a) Notice. The Administrative Agent may at any time give notice of its
resignation to the Lenders, the L/C Issuers and the Borrower. Upon receipt of
any such notice of resignation, the Required Lenders shall have the right, in
consultation with the Borrower, to appoint a successor, which shall be a bank
with an office in the United States, or an Affiliate of any such bank with an
office in the United States. If no such successor shall have been so appointed
by the Required Lenders and shall have accepted such appointment within thirty
(30) days after the retiring Administrative Agent gives notice of its
resignation (or such earlier day as shall be agreed by the Required Lenders)
(the “Resignation Effective Date”), then the retiring Administrative Agent may
(but shall not be obligated to) on behalf of the Lenders and the L/C Issuers,
appoint a successor Administrative Agent meeting the qualifications set forth
above. Whether or not a successor has been appointed, such resignation shall
become effective in accordance with such notice on the Resignation Effective
Date.

(b) Defaulting Lender. If the Person serving as Administrative Agent is a
Defaulting Lender pursuant to clause (d) of the definition thereof, the Required
Lenders may, to the extent permitted by applicable Law, by notice in writing to
the Borrower and such Person remove such Person as Administrative Agent and, in
consultation with the Borrower, appoint a successor. If no such successor shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within thirty (30) days after the Required Lenders give notice of
removal (or such earlier day as shall be agreed by the Required Lenders) (the
“Removal Effective Date”), then such removal shall nonetheless become effective
in accordance with such notice on the Removal Effective Date.

(c) Effect of Resignation or Removal. With effect from the Resignation Effective
Date or the Removal Effective Date (as applicable), (i) the retiring or removed
Administrative Agent shall be discharged from its duties and obligations
hereunder and under the other Loan Documents (except that in the case of any
collateral security held by the Administrative Agent on behalf of the Lenders or
the L/C Issuers under any of the Loan Documents, the retiring or removed
Administrative Agent shall continue to hold such collateral security until such
time as a successor Administrative Agent is appointed) and (ii) except for any
indemnity payments or other amounts then owed to the retiring or removed
Administrative Agent, all payments, communications and determinations provided
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made by or to each Lender and each L/C Issuer directly, until such time, if any,
as the Required Lenders appoint a successor Administrative Agent as provided for
above. Upon the acceptance of a successor’s appointment as Administrative Agent
hereunder, such successor shall succeed to and become vested with all of the
rights, powers, privileges and duties of the retiring (or removed)
Administrative Agent (other than as provided in Section 3.01(h) and other than
any rights to indemnity payments or other amounts owed to the retiring or
removed Administrative Agent as of the Resignation Effective Date or the Removal
Effective Date, as applicable), and the retiring or removed Administrative Agent
shall be discharged from all of its duties and obligations hereunder or under
the other Loan Documents (if not already discharged therefrom as provided above
in this Section). The fees payable by the Borrower to a successor Administrative
Agent shall be the same as those payable to its predecessor unless otherwise
agreed between the Borrower and such successor. After the retiring or removed
Administrative Agent’s resignation or removal hereunder and under the other Loan
Documents, the provisions of this Article and Section 10.04 shall continue in
effect for the benefit of such retiring or removed Administrative Agent, its
sub-agents and their respective Related Parties in respect of any actions taken
or omitted to be taken by any of them while the retiring or removed
Administrative Agent was acting as Administrative Agent.

(d) Swing Line Lender. Any resignation or removal by Bank of America as
Administrative Agent pursuant to this Section shall also constitute its
resignation as a Swing Line Lender. If Bank of America resigns as a Swing Line
Lender, it shall retain all the rights of a Swing Line Lender provided for
hereunder with respect to Swing Line Loans made by it and outstanding as of the
effective date of such resignation, including the right to require the Lenders
to make Base Rate Loans or fund risk participations in outstanding Swing Line
Loans pursuant to Section 2.04(c). Upon the appointment by the Borrower of a
successor Swing Line Lender hereunder (which successor shall in all cases be a
Lender other than a Defaulting Lender), (i) such successor shall succeed to and
become vested with all of the rights, powers, privileges and duties of the
retiring Swing Line Lender and (ii) the retiring Swing Line Lender shall be
discharged from all of its duties and obligations hereunder or under the other
Loan Documents.

9.07 Non-Reliance on Administrative Agent and Other Lenders. Each Lender and
each L/C Issuer acknowledges that it has, independently and without reliance
upon the Administrative Agent or any other Lender or any of their Related
Parties and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender and each L/C Issuer also acknowledges that it will,
independently and without reliance upon the Administrative Agent or any other
Lender or any of their Related Parties and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any other Loan Document or any related agreement or any document furnished
hereunder or thereunder.

9.08 No Other Duties, Etc.. Anything herein to the contrary notwithstanding,
none of the Arrangers, Syndication Agent or Documentation Agent listed on the
cover page hereof shall have any powers, duties or responsibilities under this
Agreement or any of the other Loan Documents, except in its capacity, as
applicable, as the Administrative Agent, a Lender or an L/C Issuer hereunder.

 

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9.09 Administrative Agent May File Proofs of Claim; Credit Bidding. In case of
the pendency of any proceeding under any Debtor Relief Law or any other judicial
proceeding relative to any Loan Party, the Administrative Agent (irrespective of
whether the principal of any Loan or L/C Obligation shall then be due and
payable as herein expressed or by declaration or otherwise and irrespective of
whether the Administrative Agent shall have made any demand on the Borrower)
shall be entitled and empowered, by intervention in such proceeding or otherwise

(a) to file and prove a claim for the whole amount of the principal and interest
owing and unpaid in respect of the Loans, L/C Obligations and all other
Obligations that are owing and unpaid and to file such other documents as may be
necessary or advisable in order to have the claims of the Lenders, the L/C
Issuers and the Administrative Agent (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Lenders, the L/C
Issuers and the Administrative Agent and their respective agents and counsel and
all other amounts due the Lenders, the L/C Issuers and the Administrative Agent
under Sections 2.03(h) and (i), 2.09 and 10.04) allowed in such judicial
proceeding; and

(b) to collect and receive any monies or other property payable or deliverable
on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender and each L/C Issuer to make such payments to the Administrative
Agent and, if the Administrative Agent shall consent to the making of such
payments directly to the Lenders and the L/C Issuers, to pay to the
Administrative Agent any amount due for the reasonable compensation, expenses,
disbursements and advances of the Administrative Agent and its agents and
counsel, and any other amounts due the Administrative Agent under Sections 2.09
and 10.04.

Nothing contained herein shall be deemed to authorize the Administrative Agent
to authorize or consent to or accept or adopt on behalf of any Lender or any L/C
Issuer any plan of reorganization, arrangement, adjustment or composition
affecting the Obligations or the rights of any Lender or any L/C Issuer to
authorize the Administrative Agent to vote in respect of the claim of any Lender
or any L/C Issuer or in any such proceeding.

The Secured Parties hereby irrevocably authorize the Administrative Agent, at
the direction of the Required Lenders, to credit bid all or any portion of the
Obligations (including accepting some or all of the Collateral in satisfaction
of some or all of the Obligations pursuant to a deed in lieu of foreclosure or
otherwise) and in such manner purchase (either directly or through one or more
acquisition vehicles) all or any portion of the Collateral (a) at any sale
thereof conducted under the provisions of the Bankruptcy Code of the United
States, including under Sections 363, 1123 or 1129 of the Bankruptcy Code of the
United States, or any similar Laws in any other jurisdictions to which a Loan
Party is subject, (b) at any other sale or foreclosure or acceptance of
collateral in lieu of debt conducted by (or with the consent or at the direction
of) the Administrative Agent (whether by judicial action or otherwise) in
accordance with any applicable Law. In connection with any such credit bid and
purchase, the Obligations owed to the Secured Parties shall be entitled to be,
and shall be, credit bid on a ratable basis (with Obligations with respect to
contingent or unliquidated claims receiving contingent interests in the acquired
assets on a ratable basis that would vest upon the liquidation of such claims in
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liquidated portion of the contingent claim amount used in allocating the
contingent interests) in the asset or assets so purchased (or in the Equity
Interests or debt instruments of the acquisition vehicle or vehicles that are
used to consummate such purchase). In connection with any such bid (i) the
Administrative Agent shall be authorized to form one or more acquisition
vehicles to make a bid, (ii) to adopt documents providing for the governance of
the acquisition vehicle or vehicles (provided that any actions by the
Administrative Agent with respect to such acquisition vehicle or vehicles,
including any disposition of the assets or Equity Interests thereof shall be
governed, directly or indirectly, by the vote of the Required Lenders,
irrespective of the termination of this Agreement and without giving effect to
the limitations on actions by the Required Lenders contained in clauses
(a) through (h) of Section 10.01 of this Agreement, and (iii) to the extent that
Obligations that are assigned to an acquisition vehicle are not used to acquire
Collateral for any reason (as a result of another bid being higher or better,
because the amount of Obligations assigned to the acquisition vehicle exceeds
the amount of debt credit bid by the acquisition vehicle or otherwise), such
Obligations shall automatically be reassigned to the Lenders pro rata and the
Equity Interests and/or debt instruments issued by any acquisition vehicle on
account of the Obligations that had been assigned to the acquisition vehicle
shall automatically be cancelled, without the need for any Secured Party or any
acquisition vehicle to take any further action.

9.10 Collateral and Guaranty Matters. Each of the Lenders (including in its
capacities as a potential Cash Management Bank and a potential Hedge Bank) and
each of the L/C Issuers irrevocably authorize the Administrative Agent, at its
option and in its discretion,

(a) to release any Lien on any property granted to or held by the Administrative
Agent under any Loan Document (i) upon termination of the Aggregate Commitments
and payment in full of all Obligations (other than (A) contingent
indemnification obligations and (B) obligations and liabilities under Secured
Cash Management Agreements and Secured Hedge Agreements as to which arrangements
satisfactory to the applicable Cash Management Bank of Hedge Bank shall have
been made) and the expiration or termination of all Letters of Credit (other
than Letters of Credit as to which other arrangements satisfactory to the
Administrative Agent and the applicable L/C Issuer shall have been made), (ii)
that is sold or to be sold as part of or in connection with any sale permitted
hereunder or under any other Loan Document, (iii) any property owned by a
Restricted Subsidiary that is designated as an Unrestricted Subsidiary in
accordance with Section 6.19, or (iv) if approved, authorized or ratified in
writing in accordance with Section 10.01;

(b) to release any Guarantor from its obligations under the Guaranty if such
Person ceases to be a Restricted Subsidiary as a result of a transaction
permitted hereunder (including designation of such Person as an Unrestricted
Subsidiary in accordance with Section 6.19); and

(c) to subordinate any Lien on any property granted to or held by the
Administrative Agent under any Loan Document to the holder of any Lien on such
property that is permitted by Section 7.01(i).

Upon request by the Administrative Agent at any time, the Required Lenders will
confirm in writing the Administrative Agent’s authority to release or
subordinate its interest in particular types or items of property, or to release
any Guarantor from its obligations under the Guaranty pursuant to this
Section 9.10. Subject in each case to this Section 9.10 , upon any Loan Party’s
request, the Administrative Agent, shall (and is hereby irrevocably authorized
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capacity as a Secured Party) and each of the L/C Issuers to), at the Borrower’s
expense, execute and deliver to the applicable Loan Party such documents as such
Loan Party may reasonably request to evidence the release of such item of
Collateral from the assignment and security interest granted under the
Collateral Documents or to subordinate its interest in such item, or to release
such Guarantor from its obligations under the Guaranty, in each case in
accordance with the terms of the Loan Documents and this Section 9.10.

The Administrative Agent shall not be responsible for or have a duty to
ascertain or inquire into any representation or warranty regarding the
existence, value or collectability of the Collateral, the existence, priority or
perfection of the Administrative Agent’s Lien thereon, or any certificate
prepared by any Loan Party in connection therewith, nor shall the Administrative
Agent be responsible or liable to the Lenders for any failure to monitor or
maintain any portion of the Collateral.

9.11 Secured Cash Management Agreements and Secured Hedge Agreements. Except as
otherwise expressly set forth herein, no Cash Management Bank or Hedge Bank that
obtains the benefit of the provisions of Section 8.03, the Guaranty or any
Collateral by virtue of the provisions hereof, of the Guaranty or any Collateral
Document shall have any right to notice of any action or to consent to, direct
or object to any action hereunder or under any other Loan Document or otherwise
in respect of the Collateral (including the release or impairment of any
Collateral) (or to notice of or to consent to any amendment, waiver or
modification of the provisions hereof or of the Guaranty or any Collateral
Document) other than in its capacity as a Lender and, in such case, only to the
extent expressly provided in the Loan Documents. Notwithstanding any other
provision of this Article IX to the contrary, the Administrative Agent shall not
be required to verify the payment of, or that other satisfactory arrangements
have been made with respect to, Obligations arising under Secured Cash
Management Agreements and Secured Hedge Agreements except to the extent
expressly provided herein and unless the Administrative Agent has received a
Secured Party Designation Notice of such Obligations, together with such
supporting documentation as the Administrative Agent may request, from the
applicable Cash Management Bank or Hedge Bank, as the case may be. The
Administrative Agent shall not be required to verify the payment of, or that
other satisfactory arrangements have been made with respect to, Obligations
arising under Secured Cash Management Agreements and Secured Hedge Agreements in
the case of termination of the Aggregate Commitments and repayment in full of
all Obligations hereunder.

9.12 Certain ERISA Matters.

(a) Each Lender (x) represents and warrants, as of the date such Person became a
Lender party hereto, to, and (y) covenants, from the date such Person became a
Lender party hereto to the date such Person ceases being a Lender party hereto,
for the benefit of, the Administrative Agent and not, for the avoidance of
doubt, to or for the benefit of the Borrower or any other Loan Party, that at
least one of the following is and will be true:

(i) such Lender is not using “plan assets” (within the meaning of Section 3(42)
of ERISA or otherwise) of one or more Benefit Plans with respect to such
Lender’s entrance into, participation in, administration of and performance of
the Loans, the Letters of Credit, the Commitments or this Agreement,

 

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(ii) the transaction exemption set forth in one or more PTEs, such as PTE 84-14
(a class exemption for certain transactions determined by independent qualified
professional asset managers), PTE 95-60 (a class exemption for certain
transactions involving insurance company general accounts), PTE 90-1 (a class
exemption for certain transactions involving insurance company pooled separate
accounts), PTE 91-38 (a class exemption for certain transactions involving bank
collective investment funds) or PTE 96-23 (a class exemption for certain
transactions determined by in-house asset managers), is applicable with respect
to such Lender’s entrance into, participation in, administration of and
performance of the Loans, the Letters of Credit, the Commitments and this
Agreement,

(iii) (A) such Lender is an investment fund managed by a “Qualified Professional
Asset Manager” (within the meaning of Part VI of PTE 84-14), (B) such Qualified
Professional Asset Manager made the investment decision on behalf of such Lender
to enter into, participate in, administer and perform the Loans, the Letters of
Credit, the Commitments and this Agreement, (C) the entrance into, participation
in, administration of and performance of the Loans, the Letters of Credit, the
Commitments and this Agreement satisfies the requirements of sub-sections
(b) through (g) of Part I of PTE 84-14 and (D) to the best knowledge of such
Lender, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied
with respect to such Lender’s entrance into, participation in, administration of
and performance of the Loans, the Letters of Credit, the Commitments and this
Agreement, or

(iv) such other representation, warranty and covenant as may be agreed in
writing between the Administrative Agent, in its sole discretion, and such
Lender.

(b) In addition, unless either (1) sub-clause (i) in the immediately preceding
clause (a) is true with respect to a Lender or (2) a Lender has provided another
representation, warranty and covenant in accordance with sub-clause (iv) in the
immediately preceding clause (a), such Lender further (x) represents and
warrants, as of the date such Person became a Lender party hereto, to, and
(y) covenants, from the date such Person became a Lender party hereto to the
date such Person ceases being a Lender party hereto, for the benefit of, the
Administrative Agent and not, for the avoidance of doubt, to or for the benefit
of the Borrower or any other Loan Party, that the Administrative Agent is not a
fiduciary with respect to the assets of such Lender involved in such Lender’s
entrance into, participation in, administration of and performance of the Loans,
the Letters of Credit, the Commitments and this Agreement (including in
connection with the reservation or exercise of any rights by the Administrative
Agent under this Agreement, any Loan Document or any documents related hereto or
thereto).

ARTICLE X

MISCELLANEOUS

10.01 Amendments, Etc.. No amendment or waiver of any provision of this
Agreement or any other Loan Document, and no consent to any departure by the
Borrower or any other Loan Party therefrom, shall be effective unless in writing
signed by the Administrative Agent, the Required Lenders and the Borrower or the
applicable Loan Party, as the case may be, and each such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given; provided, however, that no such amendment, waiver or consent shall:

(a) waive any condition set forth in Section 4.01 (other than Section 4.01(b)(i)
or (c)), or, in the case of the initial Credit Extension, Section 4.02, without
the written consent of each Lender;

 

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(b) extend or increase the Commitment of any Lender (or reinstate any Commitment
terminated pursuant to Section 8.02) without the written consent of such Lender;

(c) postpone any date fixed by this Agreement or any other Loan Document for any
payment (excluding mandatory prepayments) of principal, interest, fees or other
amounts due to any Lender without the written consent of such Lender;

(d) reduce the principal of, or the rate of interest specified herein on, any
Loan or L/C Borrowing, or (subject to clause (iv) of the second proviso to this
Section 10.01) any fees or other amounts payable hereunder or under any other
Loan Document (including interest accruing at the Default Rate pursuant to
Section 2.03(c)(iii) or Section 2.08(b)) without the written consent of each
Lender entitled to such amount;

(e) change Section 8.03 in a manner that would alter the pro rata sharing of
payments required thereby without the written consent of each Lender;

(f) change (i) any provision of this Section 10.01 or (ii) the definitions of
“Required Lenders” or “Super Majority Lenders” or any other provision hereof
specifying the number or percentage of Lenders required to amend, waive or
otherwise modify any rights hereunder or make any determination or grant any
consent hereunder without the written consent of each Lender;

(g) release all or substantially all of the Collateral in any transaction or
series of related transactions, without the written consent of each Lender;

(h) change the definition of “Borrowing Base” to increase any of the advance
rates or dollar sublimits contained therein, without the written consent of each
Lender;

(i) change (i) the definition of “Borrowing Base” to add any new categories of
eligible assets or (ii) the definition of any defined term used in the
definition of “Borrowing Base” in a manner that increases Availability, in each
case, without the written consent of the Super Majority Lenders; or

(j) release all or substantially all of the value of the Guaranty, without the
written consent of each Lender, except to the extent the release of any
Subsidiary from the Guaranty is permitted pursuant to Section 9.10 (in which
case such release may be made by the Administrative Agent acting alone);

and provided, further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the applicable L/C Issuer in addition to the Lenders
required above, affect the rights or duties of the applicable L/C Issuer under
this Agreement or any Issuer Document relating to any Letter of Credit issued or
to be issued by it; (ii) no amendment, waiver or consent shall, unless in
writing and signed by the Swing Line Lenders in addition to the Lenders required
above, affect the rights or duties of the Swing Line Lenders under this
Agreement; (iii) no amendment, waiver or consent shall, unless in writing and
signed by the Administrative Agent in addition to the Lenders required

 

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above, affect the rights or duties of the Administrative Agent under this
Agreement or any other Loan Document; and (iv) the Fee Letter may be amended, or
rights or privileges thereunder waived, in a writing executed only by the
parties thereto. Notwithstanding anything to the contrary herein, no Defaulting
Lender shall have any right to approve or disapprove any amendment, waiver or
consent hereunder (and any amendment, waiver or consent which by its terms
requires the consent of all Lenders or each affected Lender may be effected with
the consent of the applicable Lenders other than Defaulting Lenders), except
that (x) the Commitment of any Defaulting Lender may not be increased or
extended without the consent of such Lender and (y) any waiver, amendment or
modification requiring the consent of all Lenders or each affected Lender that
by its terms affects any Defaulting Lender disproportionately adversely relative
to the other affected Lenders shall require the consent of such Defaulting
Lender.

Notwithstanding anything to the contrary herein, (i) the Administrative Agent
may, with the prior written consent of the Borrower only, amend, modify or
supplement this Agreement or any of the other Loan Documents to cure any
ambiguity, omission, mistake, defect or inconsistency and (ii) this Agreement
may be amended to add an L/C Issuer, remove an L/C Issuer or modify the L/C
Issuer Sublimit of any Issuing Bank, provided that no such modification shall
result in an increase of the L/C Sublimit, without the consent of the Borrower,
the Administrative Agent and such L/C Issuer (and the consent of the Required
Lenders shall not be required).

If any Lender does not consent to a proposed amendment, waiver, consent or
release with respect to any Loan Document that requires the consent of each
Lender and that has been approved by the Required Lenders, the Borrower may
replace such Non-Consenting Lender in accordance with Section 10.13; provided
that such amendment, waiver, consent or release can be effected as a result of
the assignment contemplated by such Section (together with all other such
assignments required by the Borrower to be made pursuant to this paragraph).

10.02 Notices; Effectiveness; Electronic Communications. (a) Notices Generally.
Except in the case of notices and other communications expressly permitted to be
given by telephone (and except as provided in subsection (b) below), all 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 fax transmission or e-mail transmission as follows,
and all notices and other communications expressly permitted hereunder to be
given by telephone shall be made to the applicable telephone number, as follows:

(i) if to the Borrower, the Administrative Agent, the L/C Issuers or the Swing
Line Lenders, to the address, fax number, e-mail address or telephone number
specified for such Person on Schedule 10.02; and

(ii) if to any other Lender, to the address, fax number, e-mail address or
telephone number specified in its Administrative Questionnaire (including, as
appropriate, notices delivered solely to the Person designated by a Lender on
its Administrative Questionnaire then in effect for the delivery of notices that
may contain material non-public information relating to the Borrower).

 

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Notices and other communications sent by hand or overnight courier service, or
mailed by certified or registered mail, shall be deemed to have been given when
received; notices and other communications sent by fax transmission shall be
deemed to have been given when sent (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 and
other communications delivered through electronic communications to the extent
provided in subsection (b) below shall be effective as provided in such
subsection (b).

(b) Electronic Communications. Notices and other communications to the
Administrative Agent, the Lenders, the Swing Line Lenders and the L/C Issuers
hereunder may be delivered or furnished by electronic communication (including
e-mail, FPML messaging and Internet or intranet websites) pursuant to procedures
approved by the Administrative Agent, provided that the foregoing shall not
apply to notices to any Lender, Swing Line Lenders or the L/C Issuers pursuant
to Article II if such Lender, Swing Line Lender or L/C Issuer, as applicable,
has notified the Administrative Agent that it is incapable of receiving notices
under such Article by electronic communication. The Administrative Agent, each
Swing Line Lender, each L/C Issuer or the Borrower may each, in its discretion,
agree to accept notices and other communications to it hereunder by electronic
communications pursuant to procedures approved by it, provided that approval of
such procedures may be limited to particular notices or communications.

Unless the Administrative Agent otherwise prescribes, (i) notices and other
communications sent to an e-mail address shall be deemed received upon the
sender’s receipt of an acknowledgment from the intended recipient (such as by
the “return receipt requested” function, as available, return e-mail or other
written acknowledgement) and (ii) notices and other communications posted to an
Internet or intranet website shall be deemed received by the intended recipient
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
address or other written acknowledgement) indicating that such notice or
communication is available and identifying the website address therefor;
provided that for both clauses (i) and (ii), if such notice or other
communication is not sent during the normal business hours of the recipient,
such notice, email or communication shall be deemed to have been sent at the
opening of business on the next Business Day for the recipient.

(c) The Platform. THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” THE AGENT
PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE
BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM
LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS. NO WARRANTY OF
ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD
PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT
PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM. In no event
shall the Administrative Agent or any of its Related Parties (collectively, the
“Agent Parties”) have any liability to the Borrower, any Lender, any L/C Issuer
or any other Person for losses, claims, damages, liabilities or expenses of any
kind (whether in tort, contract or otherwise) arising out of the Borrower’s or
the Administrative Agent’s transmission of Borrower Materials or notices through
the Platform, any other electronic platform or electronic messaging services, or
through the Internet.

 

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(d) Change of Address, Etc. Each of the Borrower, the Administrative Agent, each
L/C Issuer and each Swing Line Lender may change its address, fax number or
telephone number or e-mail address for notices and other communications
hereunder by notice to the other parties hereto. Each other Lender may change
its address, fax number or telephone number or e-mail address for notices and
other communications hereunder by notice to the Borrower, the Administrative
Agent, the L/C Issuers and the Swing Line Lenders. In addition, each Lender
agrees to notify the Administrative Agent from time to time to ensure that the
Administrative Agent has on record (i) an effective address, contact name,
telephone number, fax number and e-mail address to which notices and other
communications may be sent and (ii) accurate wire instructions for such Lender.
Furthermore, each Public Lender agrees to cause at least one individual at or on
behalf of such Public Lender to at all times have selected the “Private Side
Information” or similar designation on the content declaration screen of the
Platform in order to enable such Public Lender or its delegate, in accordance
with such Public Lender’s compliance procedures and applicable Law, including
United States federal and state securities Laws, to make reference to Borrower
Materials that are not made available through the “Public Side Information”
portion of the Platform and that may contain material non-public information
with respect to the Borrower or its securities for purposes of United States
federal or state securities laws.

(e) Reliance by Administrative Agent, L/C Issuers and Lenders. The
Administrative Agent, the L/C Issuers and the Lenders shall be entitled to rely
and act upon any notices (including, without limitation, telephonic or
electronic notices, Revolving Credit Loan Notices, Notice of Loan Prepayment and
Swing Line Loan Notices) purportedly given by or on behalf of the Borrower even
if (i) such notices were not made in a manner specified herein, were incomplete
or were not preceded or followed by any other form of notice specified herein,
or (ii) the terms thereof, as understood by the recipient, varied from any
confirmation thereof. The Borrower shall indemnify the Administrative Agent,
each L/C Issuer, each Lender and the Related Parties of each of them from all
losses, costs, expenses and liabilities resulting from the reliance by such
Person on each notice purportedly given by or on behalf of the Borrower. All
telephonic notices to and other telephonic communications with the
Administrative Agent may be recorded by the Administrative Agent, and each of
the parties hereto hereby consents to such recording.

10.03 No Waiver; Cumulative Remedies; Enforcement. No failure by any Lender, any
L/C Issuer or the Administrative Agent to exercise, and no delay by any such
Person in exercising, any right, remedy, power or privilege hereunder or under
any other Loan Document shall operate as a waiver thereof; nor shall any single
or partial exercise of any right, remedy, power or privilege hereunder or under
any other Loan Document preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided, and provided under each other Loan
Document, are cumulative and not exclusive of any rights, remedies, powers and
privileges provided by law.

Notwithstanding anything to the contrary contained herein or in any other Loan
Document, the authority to enforce rights and remedies hereunder and under the
other Loan Documents against the Loan Parties or any of them shall be vested
exclusively in, and all actions and proceedings at law in connection with such
enforcement shall be instituted and maintained exclusively by, the
Administrative Agent in accordance with Section 8.02 for the benefit of all the
Lenders and all the L/C Issuers; provided, however, that the foregoing shall not
prohibit (a) the Administrative Agent from exercising on its own behalf the
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capacity as Administrative Agent) hereunder and under the other Loan Documents,
(b) the L/C Issuers or the Swing Line Lenders from exercising the rights and
remedies that inure to their respective benefit (solely in their respective
capacities as an L/C Issuer or a Swing Line Lender, as the case may be)
hereunder and under the other Loan Documents, (c) any Lender from exercising
setoff rights in accordance with Section 10.08 (subject to the terms of
Section 2.13), or (d) any Lender from filing proofs of claim or appearing and
filing pleadings on its own behalf during the pendency of a proceeding relative
to any Loan Party under any Debtor Relief Law; and provided, further, that if at
any time there is no Person acting as Administrative Agent hereunder and under
the other Loan Documents, then (i) the Required Lenders shall have the rights
otherwise ascribed to the Administrative Agent pursuant to Section 8.02 and
(ii) in addition to the matters set forth in clauses (b), (c) and (d) of the
preceding proviso and subject to Section 2.13, any Lender may, with the consent
of the Required Lenders, enforce any rights and remedies available to it and as
authorized by the Required Lenders.

10.04 Expenses; Indemnity; Damage Waiver.

(a) Costs and Expenses. The Borrower shall pay (i) all reasonable out-of-pocket
expenses incurred by the Administrative Agent and its Affiliates (including the
reasonable fees, charges and disbursements of counsel for the Administrative
Agent), in connection with the syndication of the credit facilities provided for
herein, the preparation, negotiation, execution, delivery and administration of
this Agreement and the other Loan Documents or any amendments, modifications or
waivers of the provisions hereof or thereof (whether or not the transactions
contemplated hereby or thereby shall be consummated), (ii) all reasonable
out-of-pocket expenses incurred by any L/C Issuer in connection with the
issuance, amendment, renewal or extension of any Letter of Credit or any demand
for payment thereunder and (iii) all out-of-pocket expenses incurred by the
Administrative Agent, any Lender or any L/C Issuer (including the fees, charges
and disbursements of any counsel for the Administrative Agent, any Lender or any
L/C Issuer), in connection with the enforcement or protection of its rights
(A) in connection with this Agreement and the other Loan Documents, including
its rights under this Section, or (B) in connection with Loans made or Letters
of Credit issued hereunder, including all such out-of-pocket expenses incurred
during any workout, restructuring or negotiations in respect of such Loans or
Letters of Credit. Expenses being reimbursed by the Loan Parties under this
Section 10.04(a) include, without limiting the generality of the foregoing,
fees, costs and expense incurred in connection with (i) collateral monitoring,
collateral reviews, appraisals and insurance reviews and (ii) field examinations
and the preparation of reports based on the fees charged by a third party
retained by the Administrative Agent or the internally allocated fees for each
Person employed by the Administrative Agent with respect to each field
examination. All expenses of protecting, storing, warehousing, insuring,
handling, maintaining and shipping any Collateral, all Taxes payable with
respect to any Collateral (including any sale thereof), and all other payments
required to be made by the Administrative Agent to any Person to realize upon
any Collateral, shall be borne and paid by the Borrower. The Administrative
Agent shall not be liable or responsible in any way for the safekeeping of any
Collateral, for any loss or damage thereto (except for reasonable care in its
custody while Collateral is in the Administrative Agent’s actual possession),
for any diminution in the value thereof, or for any act or default of any
warehouseman, carrier, forwarding agency or other Person whatsoever, but the
same shall be at Borrower’s sole risk.

 

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(b) Indemnification by the Borrower. The Borrower shall indemnify the
Administrative Agent (and any sub-agent thereof), each Lender and each L/C
Issuer, and each Related Party of any of the foregoing Persons (each such Person
being called an “Indemnitee”) against, and hold each Indemnitee harmless from,
any and all losses, claims, damages, liabilities and related expenses (including
the fees, charges and disbursements of any counsel for any Indemnitee) incurred
by any Indemnitee or asserted against any Indemnitee by any Person (including
the Borrower or any other Loan Party) arising out of, in connection with, or as
a result of (i) the execution or delivery of this Agreement, any other Loan
Document or any agreement or instrument contemplated hereby or thereby, the
performance by the parties hereto of their respective obligations hereunder or
thereunder or the consummation of the transactions contemplated hereby or
thereby, or, in the case of the Administrative Agent (and any sub-agent thereof)
and its Related Parties only, the administration of this Agreement and the other
Loan Documents (including in respect of any matters addressed in Section 3.01),
(ii) any Loan or Letter of Credit or the use or proposed use of the proceeds
therefrom (including any refusal by any L/C Issuer to honor a demand for payment
under a Letter of Credit if the documents presented in connection with such
demand do not strictly comply with the terms of such Letter of Credit),
(iii) any actual or alleged presence or release of Hazardous Materials on or
from any property owned or operated by the Borrower or any of its Subsidiaries,
or any Environmental Liability related in any way to the Borrower or any of its
Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation
or proceeding relating to any of the foregoing, whether based on contract, tort
or any other theory, whether brought by a third party or by the Borrower or any
other Loan Party or any of the Borrower’s or such Loan Party’s directors,
shareholders or creditors, and regardless of whether any Indemnitee is a party
thereto, IN ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING, IN WHOLE OR IN PART,
OUT OF THE COMPARATIVE, CONTRIBUTORY OR SOLE NEGLIGENCE OF THE INDEMNITEE;
provided that such indemnity shall not, as to any Indemnitee, be available to
the extent that such losses, claims, damages, liabilities or related expenses
(x) are determined by a court of competent jurisdiction by final and
nonappealable judgment to have resulted from the gross negligence or willful
misconduct of such Indemnitee, (y) result from a claim brought by the Borrower
or any other Loan Party against an Indemnitee for breach in bad faith of such
Indemnitee’s obligations hereunder or under any other Loan Document, if the
Borrower or such Loan Party has obtained a final and nonappealable judgment in
its favor on such claim as determined by a court of competent jurisdiction or
(z) arose out of any claim, actions, suits, inquiries, litigation, investigation
or proceeding that does not involve an act or omission of the Borrower, any
other Loan Party or any of their Affiliates and that is brought solely by an
Indemnitee against another Indemnitee; provided that the Arrangers, Swing Line
Lenders, L/C Issuers, and Administrative Agent shall remain indemnified in such
capacities.

(c) Reimbursement by Lenders. To the extent that the Borrower for any reason
fails to indefeasibly pay any amount required under subsection (a) or (b) of
this Section to be paid by it to the Administrative Agent (or any sub-agent
thereof), the applicable L/C Issuer, the applicable Swing Line Lender or any
Related Party of any of the foregoing, each Lender severally agrees to pay to
the Administrative Agent (or any such sub-agent), the applicable L/C Issuer, the
applicable Swing Line Lender or such Related Party, as the case may be, such
Lender’s Applicable Percentage (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount,
provided that the unreimbursed expense or indemnified loss, claim, damage,
liability or related expense, as the case may be, was incurred by or asserted
against

 

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the Administrative Agent (or any such sub-agent), such L/C Issuer or such Swing
Line Lender in its capacity as such or against any Related Party of any of the
foregoing acting for the Administrative Agent (or any such sub-agent), such L/C
Issuer or such Swing Line Lender in connection with such capacity. The
obligations of the Lenders under this subsection (c) are subject to the
provisions of Section 2.12(d).

(d) Waiver of Consequential Damages, Etc. To the fullest extent permitted by
applicable Law, the Borrower shall not assert, and hereby waives, any claim
against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement, any other
Loan Document or any agreement or instrument contemplated hereby, the
transactions contemplated hereby or thereby, any Loan or Letter of Credit or the
use of the proceeds thereof. No Indemnitee referred to in subsection (b) above
shall be liable for any damages arising from the use by unintended recipients of
any information or other materials distributed to such unintended recipients by
such Indemnitee through telecommunications, electronic or other information
transmission systems in connection with this Agreement or the other Loan
Documents or the transactions contemplated hereby or thereby other than for
direct or actual damages resulting from the gross negligence or willful
misconduct of such Indemnitee as determined by a final and nonappealable
judgment of a court of competent jurisdiction.

(e) Payments. All amounts due under this Section shall be payable not later than
ten Business Days after demand therefor.

(f) Survival. The agreements in this Section and the indemnity provisions of
Section 10.02(e) shall survive the resignation of the Administrative Agent , the
L/C Issuers and the Swing Line Lenders, the replacement of any Lender, the
termination of the Aggregate Commitments and the repayment, satisfaction or
discharge of all the other Obligations.

10.05 Payments Set Aside. To the extent that any payment by or on behalf of the
Borrower is made to the Administrative Agent, any L/C Issuer or any Lender, or
the Administrative Agent, any L/C Issuer or any Lender exercises its right of
setoff, and such payment or the proceeds of such setoff or any part thereof is
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required (including pursuant to any settlement entered into by the
Administrative Agent, such L/C Issuer or such Lender in its discretion) to be
repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of
such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such setoff had not occurred, and (b) each Lender
and each L/C Issuer severally agrees to pay to the Administrative Agent upon
demand its applicable share (without duplication) of any amount so recovered
from or repaid by the Administrative Agent, plus interest thereon from the date
of such demand to the date such payment is made at a rate per annum equal to the
Federal Funds Rate from time to time in effect. The obligations of the Lenders
and the L/C Issuers under clause (b) of the preceding sentence shall survive the
payment in full of the Obligations and the termination of this Agreement.

 

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10.06 Successors and Assigns. (a) Successors and Assigns Generally. The
provisions of this Agreement and the other Loan Documents shall be binding upon
and inure to the benefit of the parties hereto and thereto and their respective
successors and assigns permitted hereby, except that the Borrower may not assign
or otherwise transfer any of its rights or obligations hereunder without the
prior written consent of the Administrative Agent and each Lender and no Lender
may assign or otherwise transfer any of its rights or obligations hereunder
except (i) to an assignee in accordance with the provisions of Section 10.06(b),
(ii) by way of participation in accordance with the provisions of
Section 10.06(d), or (iii) by way of pledge or assignment of a security interest
subject to the restrictions of Section 10.06(e) (and any other attempted
assignment or transfer by any party hereto shall be null and void). Nothing in
this Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, their respective successors and assigns
permitted hereby, Participants to the extent provided in subsection (d) of this
Section and, to the extent expressly contemplated hereby, the Related Parties of
each of the Administrative Agent, the L/C Issuers and the Lenders) any legal or
equitable right, remedy or claim under or by reason of this Agreement.

(b) Assignments by Lenders. Any Lender may at any time assign to one or more
assignees all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment(s) and the Loans (including for
purposes of this Section 10.06(b), participations in L/C Obligations and in
Swing Line Loans) at the time owing to it); provided that any such assignment
shall be subject to the following conditions:

(i) Minimum Amounts.

(A) in the case of an assignment of the entire remaining amount of the assigning
Lender’s Commitment and the Loans at the time owing to it or contemporaneous
assignments to related Approved Funds that equal at least the amount specified
in paragraph (b)(i)(B) of this Section in the aggregate or in the case of an
assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum
amount need be assigned; and

(B) in any case not described in subsection (b)(i)(A) of this Section, the
aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) or, if the Commitment is not then in effect, the
principal outstanding balance of the Loans of the assigning Lender subject to
each such assignment, determined as of the date the Assignment and Assumption
with respect to such assignment is delivered to the Administrative Agent or, if
“Trade Date” is specified in the Assignment and Assumption, as of the Trade
Date, shall not be less than $5,000,000, unless each of the Administrative Agent
and, so long as no Event of Default has occurred and is continuing, the Borrower
otherwise consents (each such consent not to be unreasonably withheld or
delayed);

(ii) Proportionate Amounts. Each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and
obligations under this Agreement and the other Loan Documents with respect to
the Loans or the Commitment assigned, except that this clause (ii) shall not
apply to the Swing Line Lenders’ rights and obligations in respect of Swing Line
Loans;

 

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(iii) Required Consents. No consent shall be required for any assignment except
to the extent required by subsection (b)(i)(B) of this Section and, in addition:

(A) the consent of the Borrower (such consent not to be unreasonably withheld or
delayed) shall be required unless (1) an Event of Default has occurred and is
continuing at the time of such assignment or (2) such assignment is to a Lender,
an Affiliate of a Lender or an Approved Fund provided that the Borrower shall be
deemed to have consented to any such assignment unless it shall object thereto
by written notice to the Administrative Agent within five (5) Business Days
after having received notice thereof;

(B) the consent of the Administrative Agent (such consent not to be unreasonably
withheld or delayed) shall be required if such assignment is to a Person that is
not a Lender, an Affiliate of a Lender or an Approved Fund with respect to a
Lender; and

(C) the consent of the L/C Issuers and the Swing Line Lenders shall be required
for any assignment.

(iv) Assignment and Assumption. The parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and Assumption, together with
a processing and recordation fee in the amount of $3,500; provided, however,
that the Administrative Agent may, in its sole discretion, elect to waive such
processing and recordation fee in the case of any assignment. The assignee, if
it is not a Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.

(v) No Assignment to Certain Persons. No such assignment shall be made (A) to
the Borrower or any of the Borrower’s Affiliates or Subsidiaries, or (B) to any
Defaulting Lender or any of its Subsidiaries, or any Person who, upon becoming a
Lender hereunder, would constitute any of the foregoing Persons described in
this clause (B), or (C) to a natural person.

(vi) Certain Additional Payments. In connection with any assignment of rights
and obligations of any Defaulting Lender hereunder, no such assignment shall be
effective unless and until, in addition to the other conditions thereto set
forth herein, the parties to the assignment shall make such additional payments
to the Administrative Agent in an aggregate amount sufficient, upon distribution
thereof as appropriate (which may be outright payment, purchases by the assignee
of participations or subparticipations, or other compensating actions, including
funding, with the consent of the Borrower and the Administrative Agent, the
applicable pro rata share of Loans previously requested but not funded by the
Defaulting Lender, to each of which the applicable assignee and assignor hereby
irrevocably consent), to (x) pay and satisfy in full all payment liabilities
then owed by such Defaulting Lender to the Administrative Agent, any L/C Issuer
or any Lender hereunder (and interest accrued thereon) and (y) acquire (and fund
as appropriate) its full pro rata share of all Loans and participations in
Letters of Credit and Swing Line Loans in accordance with its Applicable
Percentage. Notwithstanding the foregoing, in the event that any assignment of
rights and obligations of any Defaulting Lender hereunder shall become effective
under applicable Law without compliance with the provisions of this paragraph,
then the assignee of such interest shall be deemed to be a Defaulting Lender for
all purposes of this Agreement until such compliance occurs.

 

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Subject to acceptance and recording thereof by the Administrative Agent pursuant
to subsection (c) of this Section, from and after the effective date specified
in each Assignment and Assumption, the assignee thereunder shall be a party to
this Agreement and, to the extent of the interest assigned by such Assignment
and Assumption, have the rights and obligations of a Lender under this
Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender’s rights and obligations under
this Agreement, such Lender shall cease to be a party hereto) but shall continue
to be entitled to the benefits of Sections 3.01, 3.04, 3.05 and 10.04 with
respect to facts and circumstances occurring prior to the effective date of such
assignment; provided that except to the extent otherwise expressly agreed by the
affected parties, no assignment by a Defaulting Lender will constitute a waiver
or release of any claim of any party hereunder arising from that Lender’s having
been a Defaulting Lender. Upon request, the Borrower (at its expense) shall
execute and deliver a Note to the assignee Lender. Any assignment or transfer by
a Lender of rights or obligations under this Agreement that does not comply with
this subsection shall be treated for purposes of this Agreement as a sale by
such Lender of a participation in such rights and obligations in accordance with
Section 10.06(d).

(c) Register. The Administrative Agent, acting solely for this purpose as an
agent of the Borrower (and such agency being solely for U.S. Tax purposes),
shall maintain at the Administrative Agent’s Office a copy of each Assignment
and Assumption delivered to it (or the equivalent thereof in electronic form)
and a register for the recordation of the names and addresses of the Lenders,
and the Commitments of, and principal amounts of the Loans and L/C Obligations
owing to, each Lender pursuant to the terms hereof from time to time (the
“Register”). The entries in the Register shall be conclusive absent manifest
error, and the Borrower, the Administrative Agent and the Lenders may treat each
Person whose name is recorded in the Register pursuant to the terms hereof as a
Lender hereunder for all purposes of this Agreement, notwithstanding notice to
the contrary. The Register shall be available for inspection by the Borrower and
any Lender, at any reasonable time and from time to time upon reasonable prior
notice.

(d) Participations. Any Lender may at any time, without the consent of, or
notice to, the Borrower or the Administrative Agent, sell participations to any
Person (other than a natural Person, a Defaulting Lender or the Borrower or any
of the Borrower’s Affiliates or Subsidiaries) (each, a “Participant”) in all or
a portion of such Lender’s rights and/or obligations under this Agreement
(including all or a portion of its Commitment and/or the Loans (including such
Lender’s participations in L/C Obligations and/or Swing Line Loans) owing to
it); provided that (i) such Lender’s obligations under this Agreement shall
remain unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations and (iii) the Borrower,
the Administrative Agent, the Lenders and the L/C Issuers shall continue to deal
solely and directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement. For the avoidance of doubt, each Lender shall
be responsible for the indemnity under Section 10.04(c) without regard to the
existence of any participations.

 

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Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, waiver or other modification described in the first proviso to
Section 10.01 (other than those in the proviso in Section 10.01(d)) that affects
such Participant. The Borrower agrees that each Participant shall be entitled to
the benefits of Sections 3.01, 3.04 and 3.05 (subject to the requirements and
limitations therein, including the requirements under Section 3.01(e) (it being
understood that the documentation required under Section 3.01(e) shall be
delivered to the Lender who sells the participation)) to the same extent as if
it were a Lender and had acquired its interest by assignment pursuant to
paragraph (b) of this Section; provided that such Participant (A) agrees to be
subject to the provisions of Sections 3.06 and 10.13 as if it were an assignee
under paragraph (b) of this Section and (B) shall not be entitled to receive any
greater payment under Sections 3.01 or 3.04, with respect to any participation,
than the Lender from whom it acquired the applicable participation would have
been entitled to receive, except to the extent such entitlement to receive a
greater payment results from a Change in Law that occurs after the Participant
acquired the applicable participation. Each Lender that sells a participation
agrees, at the Borrower’s request and expense, to use reasonable efforts to
cooperate with the Borrower to effectuate the provisions of Section 3.06 with
respect to any Participant. To the extent permitted by law, each Participant
also shall be entitled to the benefits of Section 10.08 as though it were a
Lender; provided that such Participant agrees to be subject to Section 2.13 as
though it were a Lender. Each Lender that sells a participation shall, acting
solely for this purpose as a non-fiduciary agent of the Borrower, maintain a
register on which it enters the name and address of each Participant and the
principal amounts (and stated interest) of each Participant’s interest in the
Loans or other obligations under the Loan Documents (the “Participant
Register”); provided that no Lender shall have any obligation to disclose all or
any portion of the Participant Register (including the identity of any
Participant or any information relating to a Participant’s interest in any
commitments, loans, letters of credit or its other obligations under any Loan
Document) to any Person except to the extent that such disclosure is necessary
to establish that such commitment, loan, letter of credit or other obligation is
in registered form under Section 5f.103-1(c) of the United States Treasury
Regulations. The entries in the Participant Register shall be conclusive absent
manifest error, and such Lender shall treat each Person whose name is recorded
in the Participant Register as the owner of such participation for all purposes
of this Agreement notwithstanding any notice to the contrary. For the avoidance
of doubt, the Administrative Agent (in its capacity as Administrative Agent)
shall have no responsibility for maintaining a Participant Register.

(e) Certain Pledges. Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement (including
under its Note, if any) to secure obligations of such Lender, including any
pledge or assignment to secure obligations to a Federal Reserve Bank; provided
that no such pledge or assignment shall release such Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.

(f) Resignation as L/C Issuer or Swing Line Lender after Assignment.
Notwithstanding anything to the contrary contained herein, if at any time Bank
of America or any other Lender assigns all of its Commitment and Revolving
Credit Loans pursuant to Section 10.06(b), Bank of America or such other Lender
may, (i) upon 30 days’ notice to the Borrower

 

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and the Lenders, resign as an L/C Issuer and/or (ii) upon 30 days’ notice to the
Borrower, resign as a Swing Line Lender. In the event of any such resignation as
an L/C Issuer or a Swing Line Lender, the Borrower shall be entitled to appoint
from among the Lenders a successor L/C Issuer with respect to its L/C Issuer
Sublimit or successor Swing Line Lender hereunder; provided, however, that no
failure by the Borrower to appoint any such successor shall affect the
resignation of Bank of America or such other Lender as an L/C Issuer or a Swing
Line Lender, as the case may be. If Bank of America or another Lender resigns as
an L/C Issuer, it shall retain all the rights, powers, privileges and duties of
an L/C Issuer hereunder with respect to all Letters of Credit outstanding as of
the effective date of its resignation as an L/C Issuer and all L/C Obligations
with respect thereto (including the right to require the Lenders to make Base
Rate Loans or fund risk participations in Unreimbursed Amounts pursuant to
Section 2.03(c)). If Bank of America or another Lender resigns as a Swing Line
Lender, it shall retain all the rights of a Swing Line Lender provided for
hereunder with respect to Swing Line Loans made by it and outstanding as of the
effective date of such resignation, including the right to require the Lenders
to make Base Rate Loans or fund risk participations in outstanding Swing Line
Loans pursuant to Section 2.04(c). Upon the appointment of a successor L/C
Issuer with respect to Bank of America or another Lender’s L/C Issuer Sublimit
and/or a successor Swing Line Lender, (a) such successor shall succeed to and
become vested with all of the rights, powers, privileges and duties of the
retiring L/C Issuer or Swing Line Lender, as the case may be, and (b) the
successor L/C Issuer shall issue letters of credit in substitution for the
Letters of Credit, if any, outstanding at the time of such succession or make
other arrangements satisfactory to the resigning L/C Issuer to effectively
assume the obligations of such resigning L/C Issuer with respect to such Letters
of Credit.

10.07 Treatment of Certain Information; Confidentiality. Each of the
Administrative Agent, the Lenders and the L/C Issuers agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its Affiliates and to its and its Affiliates’ respective
Related Parties (it being understood that the Persons to whom such disclosure is
made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential), (b) to the extent required or
requested by any regulatory authority purporting to have jurisdiction over such
Person or its Related Parties (including any self-regulatory authority, such as
the National Association of Insurance Commissioners), (c) to the extent required
by applicable laws or regulations or by any subpoena or similar legal process,
(d) to any other party hereto, (e) in connection with the exercise of any
remedies hereunder or under any other Loan Document or any action or proceeding
relating to this Agreement or any other Loan Document or the enforcement of
rights hereunder or thereunder, (f) subject to an agreement containing
provisions substantially the same as those of this Section, to (i) any assignee
of or Participant in, or any prospective assignee of or Participant in, any of
its rights or obligations under this Agreement or any Eligible Assignee invited
to be a Lender pursuant to Section 2.14(c), (ii) any actual or prospective
counterparty (or its Related Parties) to any swap or derivative transaction
relating to the Borrower and its obligations, or (iii) on a confidential basis
to (A) any rating agency in connection with rating the Borrower or its
Subsidiaries or the credit facilities provided hereunder, (B) the provider of
any Platform or other electronic delivery service used by the Administrative
Agent, the L/C Issuers and/or the Swing Line Lenders to deliver Borrower
Materials or notices to the Lenders or (C) the CUSIP Service Bureau or any
similar agency in connection with the issuance and monitoring of CUSIP numbers
or other market identifiers with respect to the credit facilities provided
hereunder, (g) with the consent of the Borrower or (h) to the extent such
Information (i) becomes publicly available other than as a result of a breach of
this

 

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Section or (ii) becomes available to the Administrative Agent, any Lender, any
L/C Issuer or any of their respective Affiliates on a nonconfidential basis from
a source other than the Borrower. For purposes of this Section, “Information”
means all information received from the Borrower or any Subsidiary relating to
the Borrower or any Subsidiary or any of their respective businesses, other than
any such information that is available to the Administrative Agent, any Lender
or any L/C Issuer on a nonconfidential basis prior to disclosure by the Borrower
or any Subsidiary, provided that, in the case of information received from the
Borrower or any Subsidiary after the date hereof, such information is clearly
identified at the time of delivery as confidential. Any Person required to
maintain the confidentiality of Information as provided in this Section shall be
considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.

Each of the Administrative Agent, the Lenders and the L/C Issuers acknowledges
that (a) the Information may include material non-public information concerning
the Borrower or a Subsidiary, as the case may be, (b) it has developed
compliance procedures regarding the use of material non-public information and
(c) it will handle such material non-public information in accordance with
applicable Law, including United States federal and state securities Laws.

The Loan Parties and their Affiliates agree that they will not in the future
issue any press releases or other public disclosure using the name of the
Administrative Agent or any Lender or their respective Affiliates or referring
to this Agreement or any of the Loan Documents without the prior written consent
of the Administrative Agent, unless (and only to the extent that) the Loan
Parties or such Affiliate is required to do so under law and then, in any event
the Loan Parties or such Affiliate will use commercial reasonable efforts to
consult with such Person before issuing such press release or other public
disclosure.

The Loan Parties consent to the publication by the Administrative Agent or any
Lender of customary advertising material relating to the transactions
contemplated hereby using the name, product photographs, logo or trademark of
the Loan Parties.

10.08 Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender, each L/C Issuer and each of their respective Affiliates
is hereby authorized at any time and from time to time, to the fullest extent
permitted by applicable law, to set off and apply any and all deposits (general
or special, time or demand, provisional or final, in whatever currency) at any
time held and other obligations (in whatever currency) at any time owing by such
Lender, such L/C Issuer or any such Affiliate to or for the credit or the
account of the Borrower against any and all of the obligations of the Borrower
now or hereafter existing under this Agreement or any other Loan Document to
such Lender or such L/C Issuer, irrespective of whether or not such Lender or
such L/C Issuer shall have made any demand under this Agreement or any other
Loan Document and although such obligations of the Borrower may be contingent or
unmatured or are owed to a branch or office of such Lender or such L/C Issuer
different from the branch or office holding such deposit or obligated on such
indebtedness; provided that in the event that any Defaulting Lender shall
exercise any such right of setoff, (x) all amounts so set off shall be paid over
immediately to the Administrative Agent for further application in accordance
with the provisions of Section 2.16 and, pending such payment, shall be
segregated by such Defaulting Lender from its other funds and deemed held in
trust for the benefit of the Administrative Agent and the Lenders, and (y) the

 

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Defaulting Lender shall provide promptly to the Administrative Agent a statement
describing in reasonable detail the Obligations owing to such Defaulting Lender
as to which it exercised such right of setoff. The rights of each Lender, each
L/C Issuer and their respective Affiliates under this Section are in addition to
other rights and remedies (including other rights of setoff) that such Lender,
such L/C Issuer or their respective Affiliates may have. Each Lender and each
L/C Issuer agrees to notify the Borrower and the Administrative Agent promptly
after any such setoff and application, provided that the failure to give such
notice shall not affect the validity of such setoff and application.

10.09 Interest Rate Limitation. Notwithstanding anything to the contrary
contained in any Loan Document, the interest paid or agreed to be paid under the
Loan Documents shall not exceed the maximum rate of non-usurious interest
permitted by applicable Law (the “Maximum Rate”). If the Administrative Agent or
any Lender shall receive interest in an amount that exceeds the Maximum Rate,
the excess interest shall be applied to the principal of the Loans or, if it
exceeds such unpaid principal, refunded to the Borrower. In determining whether
the interest contracted for, charged, or received by the Administrative Agent or
a Lender exceeds the Maximum Rate, such Person may, to the extent permitted by
applicable Law, (a) characterize any payment that is not principal as an
expense, fee, or premium rather than interest, (b) exclude voluntary prepayments
and the effects thereof, and (c) amortize, prorate, allocate, and spread in
equal or unequal parts the total amount of interest throughout the contemplated
term of the Obligations hereunder.

10.10 Counterparts; Integration; Effectiveness. This Agreement and each of the
other Loan Documents may be executed in counterparts (and by different parties
hereto in different counterparts), each of which shall constitute an original,
but all of which when taken together shall constitute a single contract. This
Agreement and the other Loan Documents constitute the entire contract among the
parties relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter
hereof. Except as provided in Section 4.01, this Agreement shall become
effective when it shall have been executed by the Administrative Agent and when
the Administrative Agent shall have received counterparts hereof that, when
taken together, bear the signatures of each of the other parties hereto.
Delivery of an executed counterpart of a signature page of this Agreement or any
other Loan Document, or any certificate delivered thereunder, by fax
transmission or e-mail transmission (e.g. “pdf” or “tif”) shall be effective as
delivery of a manually executed counterpart of this Agreement or such other Loan
Document or certificate.

10.11 Survival of Representations and Warranties. All representations and
warranties made hereunder and in any other Loan Document or other document
delivered pursuant hereto or thereto or in connection herewith or therewith
shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by the
Administrative Agent and each Lender, regardless of any investigation made by
the Administrative Agent or any Lender or on their behalf and notwithstanding
that the Administrative Agent or any Lender may have had notice or knowledge of
any Default at the time of any Credit Extension, and shall continue in full
force and effect as long as any Loan or any other Obligation hereunder shall
remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding.

 

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10.12 Severability. If any provision of this Agreement or the other Loan
Documents is held to be illegal, invalid or unenforceable, (a) the legality,
validity and enforceability of the remaining provisions of this Agreement and
the other Loan Documents shall not be affected or impaired thereby and (b) the
parties shall endeavor in good faith negotiations to replace the illegal,
invalid or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the illegal, invalid or
unenforceable provisions. The invalidity of a provision in a particular
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. Without limiting the foregoing provisions of this
Section 10.12, if and to the extent that the enforceability of any provisions in
this Agreement relating to Defaulting Lenders shall be limited by Debtor Relief
Laws, as determined in good faith by the Administrative Agent, the applicable
L/C Issuer or the applicable Swing Line Lenders, as applicable, then such
provisions shall be deemed to be in effect only to the extent not so limited.

10.13 Replacement of Lenders. If the Borrower is entitled to replace a Lender
pursuant to the provisions of Section 3.06, or if any Lender is a Defaulting
Lender or a Non-Consenting Lender or if any other circumstance exists hereunder
that gives the Borrower the right to replace a Lender as a party hereto, then
the Borrower may, at its sole expense and effort, upon notice to such Lender and
the Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in, and
consents required by, Section 10.06), all of its interests, rights (other than
its existing rights to payments pursuant to Sections 3.01 and 3.04) and
obligations under this Agreement and the related Loan Documents to an Eligible
Assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment), provided that:

(a) the Borrower shall have paid to the Administrative Agent the assignment fee
(if any) specified in Section 10.06(b);

(b) such Lender shall have received payment of an amount equal to 100% of the
outstanding principal of its Loans and L/C Advances, accrued interest thereon,
accrued fees and all other amounts payable to it hereunder and under the other
Loan Documents (including any amounts under Section 3.05) from the assignee (to
the extent of such outstanding principal and accrued interest and fees) or the
Borrower (in the case of all other amounts);

(c) in the case of any such assignment resulting from a claim for compensation
under Section 3.04 or payments required to be made pursuant to Section 3.01,
such assignment will result in a reduction in such compensation or payments
thereafter;

(d) such assignment does not conflict with applicable Laws; and

(e) in the case of an assignment resulting from a Lender becoming a
Non-Consenting Lender, the applicable assignee shall have consented to the
applicable amendment, waiver or consent.

A Lender shall not be required to make any such assignment or delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling the Borrower to require such assignment and delegation
cease to apply.

 

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10.14 Governing Law; Jurisdiction; Etc.. (a) GOVERNING LAW. THIS AGREEMENT AND
THE OTHER LOAN DOCUMENTS (EXCEPT, AS TO ANY OTHER LOAN DOCUMENT, AS EXPRESSLY
SET FORTH THEREIN) 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 OR ANY OTHER LOAN DOCUMENT (EXCEPT, AS TO ANY OTHER
LOAN DOCUMENT, AS EXPRESSLY SET FORTH THEREIN) 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) SUBMISSION TO JURISDICTION. THE BORROWER IRREVOCABLY AND UNCONDITIONALLY
AGREES THAT IT WILL NOT COMMENCE ANY ACTION, LITIGATION OR PROCEEDING OF ANY
KIND OR DESCRIPTION, WHETHER IN LAW OR EQUITY, WHETHER IN CONTRACT OR IN TORT OR
OTHERWISE, AGAINST THE ADMINISTRATIVE AGENT, ANY LENDER, THE L/C ISSUER, OR ANY
RELATED PARTY OF THE FOREGOING IN ANY WAY RELATING TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT OR THE TRANSACTIONS RELATING HERETO OR THERETO, IN ANY FORUM
OTHER THAN THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF
THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY
APPELLATE COURT FROM ANY THEREOF, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND
UNCONDITIONALLY SUBMITS TO THE JURISDICTION OF SUCH COURTS AND AGREES THAT ALL
CLAIMS IN RESPECT OF ANY SUCH ACTION, LITIGATION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A
FINAL JUDGMENT IN ANY SUCH ACTION, LITIGATION OR PROCEEDING SHALL BE CONCLUSIVE
AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY
OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN
DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER OR ANY
L/C ISSUER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE BORROWER OR ANY OTHER LOAN
PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

(c) WAIVER OF VENUE. THE BORROWER IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED
TO IN PARAGRAPH (B) OF THIS SECTION. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE
DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING
IN ANY SUCH COURT.

 

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(d) SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF
PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02. NOTHING IN THIS
AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY APPLICABLE LAW.

10.15 Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON
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 AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

10.16 No Advisory or Fiduciary Responsibility. In connection with all aspects of
each transaction contemplated hereby (including in connection with any
amendment, waiver or other modification hereof or of any other Loan Document),
the Borrower acknowledges and agrees, and acknowledges its Affiliates’
understanding, that: (a)(i) the arranging and other services regarding this
Agreement provided by the Administrative Agent and any Affiliate thereof, the
Arrangers and the Lenders are arm’s-length commercial transactions between the
Borrower, each other Loan Party and their respective Affiliates, on the one
hand, and the Administrative Agent and, as applicable, its Affiliates and the
Lenders and their Affiliates (including the Arrangers) (collectively, solely for
purposes of this Section, the “Lenders”), on the other hand, (ii) each of the
Borrower and the other Loan Parties has consulted its own legal, accounting,
regulatory and tax advisors to the extent it has deemed appropriate, and
(iii) the Borrower and each other Loan Party is capable of evaluating, and
understands and accepts, the terms, risks and conditions of the transactions
contemplated hereby and by the other Loan Documents; (b)(i) the Administrative
Agent and its Affiliates and each Lender and its Affiliates (including the
Arrangers) each is and has been acting solely as a principal and, except as
expressly agreed in writing by the relevant parties, has not been, is not, and
will not be acting as an advisor, agent or fiduciary, for the Borrower, any
other Loan Party or any of their respective Affiliates, or any other Person and
(ii) neither the Administrative Agent, any of its Affiliates nor any Lender or
any of its Affiliates (including the Arrangers) has any obligation to the
Borrower, any other Loan Party or any of their respective Affiliates with
respect to the transactions contemplated hereby except those obligations
expressly set forth herein and in the other Loan Documents; and (c) the
Administrative Agent and its Affiliates and the Lenders and their Affiliates
(including the Arrangers) may be engaged in a broad range of transactions that
involve interests that differ from those of the Borrower, the other Loan Parties
and their respective Affiliates, and neither the Administrative Agent, any of
its Affiliates nor any Lender or its Affiliates (including the Arrangers) has
any obligation to disclose any of such interests to the Borrower, any other Loan
Party or any of their respective Affiliates. To the fullest extent permitted by
law, each of the Borrower and each other Loan Party hereby waives and releases
any claims that it may have against the Administrative Agent, any of its
Affiliates or any Lender or its Affiliates (including the Arrangers) with
respect to any breach or alleged breach of agency or fiduciary duty in
connection with any aspect of any transactions contemplated hereby.

 

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10.17 Electronic Execution of Assignments and Certain Other Documents. The words
“delivery,” “execute,” “execution,” “signed,” “signature,” and words of like
import in any Loan Document or any other document executed in connection
herewith shall be deemed to include electronic signatures, the electronic
matching of assignment terms and contract formations on electronic platforms
approved by the Administrative Agent, or the keeping of records in electronic
form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature, physical delivery thereof or
the use of a paper-based recordkeeping system, as the case may be, to the extent
and as provided for in any applicable Law, including the Federal Electronic
Signatures in Global and National Commerce Act, the New York State Electronic
Signatures and Records Act, or any other similar state laws based on the Uniform
Electronic Transactions Act; provided that notwithstanding anything contained
herein to the contrary neither the Administrative Agent, any L/C Issuer nor any
Lender is under any obligation to agree to accept electronic signatures in any
form or in any format unless expressly agreed to by the Administrative Agent,
such L/C Issuer or such Lender pursuant to procedures approved by it and
provided further without limiting the foregoing, upon the request of any party,
any electronic signature shall be promptly followed by such manually executed
counterpart.

10.18 USA PATRIOT Act. The Administrative Agent and the Lenders hereby notify
the Borrower and the other Loan Parties that pursuant to the Patriot Act, Agent
and Lenders are required to obtain, verify and record information that
identifies each Loan Party, including its legal name, address, tax ID number and
other information that will allow the Administrative Agent and the Lenders to
identify it in accordance with the Patriot Act. The Loan Parties shall, promptly
upon request, provide all documentation and other information as the
Administrative Agent, any L/C Issuer or any Lender may request from time to time
for purposes of complying with any “know your customer,” anti-money laundering
rules and regulations, or other requirements of Applicable Law, including the
Patriot Act and Beneficial Ownership Regulation.

10.19 Keepwell. Each Loan Party that is a Qualified ECP Guarantor at the time
the Guaranty or the grant of the security interest under the Loan Documents, in
each case, by any Specified Loan Party, becomes effective with respect to any
Swap Obligation, hereby jointly and severally, absolutely, unconditionally and
irrevocably undertakes to provide such funds or other support to each Specified
Loan Party with respect to such Swap Obligation as may be needed by such
Specified Loan Party from time to time to honor all of its obligations under its
Guaranty and the other Loan Documents in respect of such Swap Obligation (but,
in each case, only up to the maximum amount of such liability that can be hereby
incurred without rendering such Qualified ECP Guarantor’s obligations and
undertakings under this Section 10.19 voidable under applicable Law relating to
fraudulent conveyance or fraudulent transfer, and not for any greater amount).
The obligations and undertakings of each Qualified ECP Guarantor under this
Section shall remain in full force and effect until the Obligations have been
indefeasibly paid and performed in full. The Borrower intends this Section to
constitute, and this Section shall be deemed to constitute, a guarantee of the
obligations of, and a “keepwell, support, or other agreement” for the benefit
of, each Specified Loan Party for all purposes of the Commodity Exchange Act.

 

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10.20 Credit Inquiries. The Administrative Agent and the Lenders may (but shall
have no obligation) to respond to usual and customary credit inquiries from
third parties concerning any Loan Party or Subsidiary.

10.21 Performance of Borrower’s Obligations. The Administrative Agent may, in
its discretion at any time and from time to time, at the Borrower’s expense, pay
any amount or do any act required of the Borrower or any other Loan Party under
any Loan Documents or otherwise lawfully requested by the Administrative Agent
to (a) enforce any Loan Documents or collect any Obligations; (b) protect,
insure, maintain or realize upon any Collateral; or (c) defend or maintain the
validity or priority of the Administrative Agent’s Liens in any Collateral,
including any payment of a judgment, insurance premium, warehouse charge,
finishing or processing charge, or landlord claim, or any discharge of a Lien.
All payments, costs and expenses of the Administrative Agent under this Section
shall be reimbursed to the Administrative Agent by the Borrower, on demand, with
interest from the date incurred until paid in full, at the Default Rate
applicable to Base Rate Loans. Any payment made or action taken by the
Administrative Agent under this Section shall be without prejudice to any right
to assert an Event of Default or to exercise any other rights or remedies under
the Loan Documents.

10.22 Waivers by Borrower. To the fullest extent permitted by Applicable Law,
the Borrower waives (a) presentment, demand, protest, notice of presentment,
default, non-payment, maturity, release, compromise, settlement, extension or
renewal of any commercial paper, accounts, documents, instruments, chattel paper
and guaranties at any time held by the Administrative Agent on which the
Borrower may in any way be liable, and hereby ratifies anything the
Administrative Agent may do in this regard; (b) notice prior to taking
possession or control of any Collateral; (c) any bond or security that might be
required by a court prior to allowing the Administrative Agent to exercise any
rights or remedies; (d) the benefit of all valuation, appraisement and exemption
laws; (e) any claim against an Indemnitee, on any theory of liability, for
special, indirect, consequential, exemplary or punitive damages (as opposed to
direct or actual damages) in any way relating to any enforcement action,
Obligations, Loan Documents or transactions relating thereto; and (f) notice of
acceptance hereof. The Borrower acknowledges that the foregoing waivers are a
material inducement to the Administrative Agent, the L/C Issuers and the Lenders
entering into this Agreement and that they are relying upon the foregoing in
their dealings with the Borrower. The Borrower has reviewed the foregoing
waivers, including the waiver of jury trial in Section 10.15, with its legal
counsel and has knowingly and voluntarily waived its jury trial and other rights
following consultation with legal counsel. In the event of litigation, this
Agreement may be filed as a written consent to a trial by the court.

10.23 ENTIRE AGREEMENT. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT
THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE
NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.

 

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10.24 Acknowledgement and Consent to Bail-In of EEA Financial Institutions.
Notwithstanding anything to the contrary in any Loan Document or in any other
agreement, arrangement or understanding among any such parties, each party
hereto acknowledges that any liability of any EEA Financial Institution arising
under any Loan Document, to the extent such liability is unsecured, may be
subject to the Write-Down and Conversion Powers of an EEA Resolution Authority
and agrees and consents to, and acknowledges and agrees to be bound by:

(a) the application of any Write-Down and Conversion Powers by an EEA Resolution
Authority to any such liabilities arising hereunder which may be payable to it
by any party hereto that is an EEA Financial Institution; and

(b) the effects of any Bail-In Action on any such liability, including, if
applicable:

(i) a reduction in full or in part or cancellation of any such liability;

(ii) a conversion of all, or a portion of, such liability into shares or other
instruments of ownership in such EEA Financial Institution, its parent
undertaking, or a bridge institution that may be issued to it or otherwise
conferred on it, and that such shares or other instruments of ownership will be
accepted by it in lieu of any rights with respect to any such liability under
this Agreement or any other Loan Document; or

(iii) the variation of the terms of such liability in connection with the
exercise of the Write-Down and Conversion Powers of any EEA Resolution
Authority.

The provisions of this Section 10.24 are intended to comply with, and shall be
interpreted in light of, Article 55 of Directive 2014/59/EU of the European
Parliament and of the Council of the European Union.

[Remainder of This Page Intentionally Left Blank]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.

 

BASIC ENERGY SERVICES, INC. By:   /s/ T.M. “Roe” Patterson Name:   T.M. “Roe”
Patterson Title:   President and Chief Executive Officer

[Signature Page to Credit Agreement]

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

BANK OF AMERICA, N.A.,

as Administrative Agent, a Lender, an L/C

Issuer and a Swing Line Lender

By:   /s/ Lisa Huynh Name:   Lisa Huynh Title:   Vice President

[Signature Page to Credit Agreement]

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

UBS AG, STAMFORD BRANCH, as a Lender and a L/C Issuer By:   /s/ Kenneth Chin
Name:   Kenneth Chin Title:   Director By:   /s/ Darlene Arias Name:   Darlene
Arias Title:   Director

[Signature Page to Credit Agreement]

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

PNC BANK NATIONAL ASSOCIATION,

as a Lender and a L/C Issuer

By:   /s/ Thomas N. Tone Name:   Thomas N. Tone Title:   Vice President

[Signature Page to Credit Agreement]

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

SCHEDULE 1.01

COMMITMENTS

AND APPLICABLE PERCENTAGES

 

Lender

   Revolving Credit
Commitment      Revolving Credit Applicable
Percentage  

Bank of America, N.A.

   $ 50,000,000.00        33.33333334 % 

UBS AG, Stamford Branch

   $ 50,000,000.00        33.33333333 % 

PNC Bank National Association

   $ 50,000,000.00        33.33333333 %    

 

 

    

 

 

 

TOTAL

   $ 150,000,000.00        100.000000000 % 

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

SCHEDULE 1.01(a)

EXISTING LETTERS OF CREDIT

 

Beneficiary

   L/C#      Issue Date      Expiration
Date      Amount  

Ace American Insurance

     3128685        7/29/2013        8/1/2019      $ 9,698,325.00  

Ace American Insurance

     68106482        9/15/2014        8/1/2019      $ 17,329,225.00  

WEX Bank

     68125993        5/20/2016        5/20/2019      $ 700,000.00  

Liberty Mutual Insurance

     68132622        4/11/2017        4/11/2019      $ 8,000,000.00  

National Union Fire

     68132623        4/11/2017        4/11/2019      $ 584,589.00  

Keystone National

     68133660        6/12/2017        6/12/2019      $ 3,500,000.00  

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

SCHEDULE 5.13

SUBSIDIARIES AND OTHER EQUITY INVESTMENTS;

LOAN PARTIES

 

  (a)

List of Subsidiaries and Equity Interests

 

Equity Holder

  

Owned Entity

  

Certificate
#

  

Number & Type
of Shares

  

Percentage
of Shares

Basic Energy Services, Inc.

   Basic Energy Services GP, LLC    002    1,000 Units of membership interest   
100%

Basic Energy Services, Inc.

   Basic Energy Services LP, LLC    002    1,000 Units of membership interest   
100%

Basic Energy Services GP, LLC

   Basic Energy Services, L.P.    *    0.10% GP interest    100%

Basic Energy Services, Inc.

   Basic ESA, Inc.    135 & 136    510,000 shares of common stock    100%

Basic Energy Services, L.P.

   Basic Energy Services International, LLC    *    1,000 Units of membership
interest    100%

Basic ESA, Inc.

   ESA de Mexico S.A. de C.v    *    1% partes sociales    66%

Basic Energy Services, L.P.

   Basic Marine Services, Inc.    2    10 shares of common stock    100%

Basic Energy Services, L.P.

   Chaparral Service, Inc.    10    13,000 shares of common stock    100%

Basic Energy Services, L.P.

   First Energy Services Company    29    1,000 shares of common stock    100%

Basic Energy Services, L.P.

   Globe Well Service, Inc.    21    4,521 shares of common stock    100%

Basic Energy Services, L.P.

   JS Acquisition LLC    001    100 units of membership interest    100%

Basic Energy Services, L.P.

   LeBus Oil Field Service Co.    42    1,000 shares of common stock    100%

Basic Energy Services, L.P.

   Maverick Coil Tubing Services, LLC    *    Membership interests    100%

Basic Energy Services, L.P.

   Maverick Solutions, LLC    *    Membership interests    100%

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

Equity Holder

  

Owned Entity

  

Certificate
#

  

Number & Type
of Shares

  

Percentage
of Shares

Basic Energy Services, L.P.

   Maverick Stimulation Company, LLC    *    Membership interests    100%

Basic Energy Services, L.P.

   Maverick Thru-Tubing Services, LLC    *    Membership interests    100%

Basic Energy Services, L.P.

   MCM Holdings, LLC    *    Membership interests    100%

Basic Energy Services, L.P

   MSM Leasing, LLC    *    Membership interests    100%

Basic Energy Services, L.P

   The Maverick Companies, LLC    *    Membership interests    100%

Basic Energy Services, L.P.

   Permian Plaza, LLC    1    Membership interest    100%

Basic Energy Services, L.P.

   Platinum Pressure Services, Inc.    12    9,642,862 shares of common stock   
100%

Basic Energy Services, L.P.

   SCH Disposal, L.L.C.    6    Membership interest    100%

Basic Energy Services, L.P.

   Sledge Drilling Corp.    7    650,000 shares of common stock    100%

Basic Energy Services, L.P.

   Taylor Industries, LLC    1    Membership interest    100%

Basic Energy Services, L.P.

   XTERRA Fishing & Rental Tools Co.    6    68,000 shares of common stock   
100%

Basic Energy Services, L.P.

   Robota Energy Equipment, LLC    1    Membership interest    80%

Basic Energy Services, L.P.

   BER Holdco, LLC    *    Membership interest    100%

BER Holdco, LLC

   Basic Energy Receivables, LLC    *    Membership interest    100%

Basic Energy Services, LP, LLC

   Basic Energy Services, L.P.    *    99.9% Limited Partnership Interest   
100%

JetStar Holdings, Inc.

   JetStar Energy Services, Inc.    C001    100 shares of common stock    100%

JS Acquisition LLC

   Acid Services, LLC    23    Membership interest    100%

JS Acquisition LLC (successor by merger to JetStar Consolidated Holdings, Inc.)

   JetStar Holdings, Inc.    C002    100 shares of common stock    100%

Platinum Pressure Services, Inc.

   Admiral Well Service, Inc.    2    100 shares of common stock    100%

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

Equity Holder

  

Owned Entity

  

Certificate
#

  

Number & Type
of Shares

  

Percentage
of Shares

Basic Energy Services, L.P.

   Robota Energy Equipment, LLC    *    20 units of membership interest    20%

 

*

The membership interest in each of the entities are not currently represented by
certificates issued to the membership interest owner.

 

  (b)

Any Other Equity Investments. None.

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

  (c)

List of Loan Parties; Jurisdiction of its incorporation; Address of its
principal place of business and its U.S. Taxpayer Identification Number

 

Debtor

  

Jurisdiction &
Type of
Organization

  

Organizational
ID# and
Taxpayer ID#

  

Chief Executive Office,

Sole Place of Business, or

Principal Residence

Basic Energy Services, Inc.    Delaware corporation   

3611854

54-2091194

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Acid Services, LLC   
Kansas limited liability company   

2347722

48-1180455

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Admiral Well Service,
Inc.    Texas corporation   

0801050244

26-3164899

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Basic Energy Services GP,
LLC    Delaware limited liability company   

3611876

54-2091197

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Basic Energy Services LP,
LLC    Delaware limited liability company   

3611879

54-1091195

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Basic Energy Services,
L.P.    Delaware limited partnership   

2307778

75-2441819

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Basic ESA, Inc.    Texas
corporation   

57139400

75-1772279

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Basic Marine Services,
Inc.    Delaware corporation   

3917169

20-2274888

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Chaparral Service, Inc.
   New Mexico corporation   

642181

85-0206424

   [801 Cherry Street, Suite 2100, Fort Worth, TX 76102] First Energy Services
Company    Delaware corporation   

3215172

84-1544437

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Globe Well Service, Inc.
   Texas corporation   

46471700

75-1634275

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 JetStar Energy Services,
Inc.    Texas corporation   

800481218

68-0605237

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 JetStar Holdings, Inc.   
Delaware corporation   

3954247

74-3144248

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 JS Acquisition LLC   
Delaware corporation   

4278935

26-2529500

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 LeBus Oil Field Service
Co.    Texas corporation   

77931600

75-2073125

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Maverick Coil Tubing
Services, LLC    Colorado limited liability company   

20001207071

84-1563281

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Maverick Solutions, LLC
   Colorado limited liability company   

20031245775

20-0122876

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Maverick Stimulation
Company, LLC    Colorado limited liability company   

19961105940

84-1354572

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Maverick Thru-Tubing
Services, LLC    Colorado limited liability company   

20091658924

27-1501902

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102

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

Debtor

  

Jurisdiction &
Type of
Organization

  

Organizational
ID# and
Taxpayer ID#

  

Chief Executive Office,

Sole Place of Business, or

Principal Residence

MCM Holdings, LLC    Colorado limited liability company   

20011090566

84-1520949

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 MSM Leasing, LLC   
Colorado limited liability company   

20091399908

27-0629182

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Permian Plaza, LLC   
Texas limited liability company   

800859993

26-0753425

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Platinum Pressure
Services, Inc.    Texas corporation   

0800888088

26-1338379

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 SCH Disposal, L.L.C.   
Texas limited liability company   

704317322

75-2788335

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Sledge Drilling Corp.   
Texas corporation   

800575730

20-4223140

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 Taylor Industries, LLC   
Texas limited liability company   

801259923

27-2417037

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 The Maverick Companies,
LLC    Colorado limited liability company   

20061298717

20-5244170

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102 XTERRA Fishing & Rental
Tools Co.    Texas corporation   

158550700

76-0647818

   801 Cherry Street, Suite 2100, Fort Worth, TX 76102

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

SCHEDULE 6.12

GUARANTORS

 

Acid Services, LLC Admiral Well Service, Inc. Basic Energy Services GP, LLC
Basic Energy Services LP, LLC Basic Energy Services, L.P. Basic ESA, Inc. Basic
Marine Services, Inc. Chaparral Service, Inc. First Energy Services Company
Globe Well Service, Inc. JetStar Energy Services, Inc. JetStar Holdings, Inc. JS
Acquisition LLC LeBus Oil Field Service Co. Maverick Coil Tubing Services, LLC
Maverick Solutions, LLC Maverick Stimulation Company, LLC Maverick Thru-Tubing
Services, LLC MCM Holdings, LLC MSM Leasing, LLC The Maverick Companies, LLC
Permian Plaza, LLC Platinum Pressure Services, Inc. SCH Disposal, L.L.C. Sledge
Drilling Corp. Taylor Industries, LLC XTERRA Fishing & Rental Tools Co.

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

SCHEDULE 6.18

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

SCHEDULE 7.01

EXISTING LIENS

The Texas Comptroller of Public Accounts filed a Texas State Tax Lien with the
County Clerk of Tarrant County, Texas under filing instrument number D218095799
on May 4, 2018. This filing covers Texas motor vehicle and use tax for the
period September 1, 2011 through December 31, 2013 in the amount of $328,775.38.
The Borrower has paid said liability in full, however we are still in the
process of getting authorization from the Texas Comptroller of Public Accounts
to release this lien of record.

Any and all easements, right of ways or other encumbrances on title to real
property of record.

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

SCHEDULE 7.02

EXISTING INDEBTEDNESS

None.

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

SCHEDULE 7.03

INVESTMENTS

None existing on the date hereof.

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

SCHEDULE 7.09

BURDENSOME AGREEMENTS

None.

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

SCHEDULE 10.02

ADMINISTRATIVE AGENT’S OFFICE, CERTAIN ADDRESSES

FOR NOTICES

Address, telephone number, fax number, and email for the Administrative Agent,
an L/C Issuer and the Swing Line Lender:

Bank of America, N.A., as Administrative Agent:

Administrative Agent’s Office

(for payments and Requests for Credit Extensions):

Bank of America, N.A.

901 Main Street 14th Floor

Mail Code: TX1-492-14-14

Dallas, TX 75202

Attention: Angie Hidalgo

Telephone: 972-338-3768

Electronic Mail: angie.hidalgo@baml.com

Account No.: 1292000883

Ref: Basic Energy Services

ABA# 026009593

Other Notices as Administrative Agent:

Bank of America, N.A.

Agency Management – Patrick Devitt

Gateway Village – 900 Building

900 W. Trade St

Mail Code: NC1-026-06-03

Charlotte, NC 28255-0001

Attention: Patrick Devitt

Telephone: (980)387-4155

Telecopier: (704)409-0016

Electronic Mail: patrick.devitt@baml.com

Bank of America, N.A., as L/C Issuer:

Bank of America, N.A.

Trade Operations

1 Fleet Way

Mail Code: PA6-580-02-30

Scranton, PA 18507

Attention: Charles Herron

Telephone: 570-496-9564

Telecopier: 800-755-8743

Electronic Mail: charles.p.herron@baml.com

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

Bank of America, N.A., as Swing Line Lender:

Bank of America, N.A.

901 Main Street 14th Floor

Mail Code: TX1-492-14-14

Dallas, TX 75202

Attention: Angie Hidalgo

Telephone: 972-338-3768

Electronic Mail: angie.hidalgo@baml.com

Account No.: 1292000883

Ref: Basic Energy Services

ABA# 026009593

Address, telephone number, fax number and email for UBS AG, Stamford Branch, an
L/C Issuer:

UBS AG, Stamford Branch

600 Washington Boulevard

Stamford, Connecticut 06901

Attention: Agency Group

Fax No.: (203) 719-3888

Email: Agency-UBSAmericas@ubs.com

Address, telephone number, fax number and email for PNC Bank National
Association an L/C Issuer:

PNC Bank National Association

2100 Ross Avenue, Suite 1850

Dallas, Texas 75201

Attention: Thomas Tone

Telephone No.: (214) 871-1245

Fax No.: (214) 871-2015

With a copy to:

PNC Bank, National Association

PNC Firstside Center

500 First Avenue

Pittsburgh, Pennsylvania 15219

Attention: PNC Agency Services

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

Address, telephone number, fax number and email for the Borrower:

Basic Energy Services, Inc.

801 Cherry Street, Suite 2100

Fort Worth, TX 76102

Attention: T.M. “Roe” Patterson

Telephone No.: 817-334-4100

Fax No.: 817-334-4101

Email: john.underwood@basicenergyservices.com

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

EXHIBIT A

FORM OF REVOLVING CREDIT LOAN NOTICE

Date: ___________, ______

 

To:

Bank of America, N.A., as Administrative Agent

Ladies and Gentlemen:

Reference is made to that certain ABL Credit Agreement, dated as of October 2,
2018 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the “Credit Agreement”; the terms defined therein
being used herein as therein defined), among Basic Energy Services, Inc., a
Delaware corporation (the “Borrower”), the Lenders from time to time party
thereto and Bank of America, N.A., as Administrative Agent, Swing Line Lender
and an L/C Issuer.

The undersigned hereby requests (select one):

☐ A Revolving Credit Borrowing

 

  1.

On ___________________________________ (a Business Day).

 

  2.

In the amount of $ _______________________

 

  3.

Comprised of ___________________________

[Type of Loan requested]

 

  4.

For LIBOR Loans: with an Interest Period of ____ months.

☐ A conversion or continuation of Revolving Credit Loans

A. Revolving Credit Loan(s) to be converted or continued:

 

  1.

On ___________________________________ (a Business Day).

 

  2.

In the amount of $ _______________________

 

  3.

Comprised of_________________________________

[Type of Loan]

 

  4.

For LIBOR Loans: with an Interest Period of ____ months.

B. Revolving Credit Loan(s) to be converted or continued as:

 

  1.

On ___________________________________ (a Business Day).

 

  2.

In the amount of $ _______________________

[Exhibit A to ABL Credit Agreement]

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

  3.

Comprised of ____________________________

[Type of Loan]

 

  4.

For LIBOR Loans: with an Interest Period of ____ months.

The Revolving Credit Borrowing requested herein complies with the requirements
of Sections 2.01 and 2.02 of the Credit Agreement.

The Borrower hereby represents and warrants that the conditions specified in
Sections 4.02(a) and (b) of the Credit Agreement shall be satisfied on and as of
the date of the applicable Credit Extension.

Delivery of an executed counterpart of a signature page of this notice by fax
transmission or other electronic mail transmission (e.g. “pdf” or “tif”) shall
be effective as delivery of a manually executed counterpart of this notice.

 

BASIC ENERGY SERVICES, INC.

By:    

Name:   Title:  

[Exhibit A to ABL Credit Agreement]

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

EXHIBIT B

FORM OF SWING LINE LOAN NOTICE

Date:                 ,         

 

To:

Bank of America, N.A., as Swing Line Lender, and

Bank of America, N.A., as Administrative Agent

Ladies and Gentlemen:

Reference is made to that certain ABL Credit Agreement, dated as of October 2,
2018 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the “Credit Agreement”; the terms defined therein
being used herein as therein defined), among Basic Energy Services, Inc., a
Delaware corporation (the “Borrower”), the Lenders from time to time party
thereto, and Bank of America, N.A., as Administrative Agent, Swing Line Lender
and an L/C Issuer.

The undersigned hereby requests a Swing Line Loan:

 

  1.

On                                                       (a Business Day).

 

  2.

In the amount of $                                        .

The Swing Line Borrowing requested herein complies with the requirements of
Sections 2.04(a) and (b) of the Credit Agreement.

The Borrower hereby represents and warrants that the conditions specified in
Sections 4.02(a) and (b) shall be satisfied on and as of the date of the
applicable Credit Extension.

Delivery of an executed counterpart of a signature page of this notice by fax
transmission or other electronic mail transmission (e.g. “pdf” or “tif”) shall
be effective as delivery of a manually executed counterpart of this notice.

 

BASIC ENERGY SERVICES, INC.

By:    

Name:   Title:  

 

 

[Exhibit B to ABL Credit Agreement]

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

EXHIBIT C

FORM OF NOTE

Date:                 ,         

FOR VALUE RECEIVED, the undersigned (the “Borrower”), hereby promises to pay
to                                     or registered assigns (the “Lender”), in
accordance with theprovisions of the Credit Agreement (as hereinafter defined),
the principal amount of each Revolving Credit Loan from time to time made by the
Lender to the Borrower under that certain ABL Credit Agreement, dated as of
October 2, 2018 (as amended, restated, extended, supplemented or otherwise
modified in writing from time to time, the “Credit Agreement”; the terms defined
therein being used herein as therein defined), among the Borrower, the Lenders
from time to time party thereto, and Bank of America, N.A., as Administrative
Agent, Swing Line Lender and an L/C Issuer.

The Borrower hereby promises to pay interest on the unpaid principal amount of
each Revolving Credit Loan from the date of such Loan until such principal
amount is paid in full, at such interest rates and at such times as provided in
the Credit Agreement. All payments of principal and interest shall be made to
the Administrative Agent for the account of the Lender in Dollars in immediately
available funds at the Administrative Agent’s Office. If any amount is not paid
in full when due hereunder (whether at stated maturity, by acceleration or
otherwise), such unpaid amount shall bear interest, to be paid upon demand, from
the due date thereof until the date of actual payment (and before as well as
after judgment) computed at the per annum rate set forth in the Credit
Agreement.

This Note is one of the Notes referred to in the Credit Agreement, is entitled
to the benefits thereof and may be prepaid in whole or in part subject to the
terms and conditions provided therein. This Note is also entitled to the
benefits of the Guaranty and is secured by the Collateral. Upon the occurrence
and continuation of one or more of the Events of Default specified in the Credit
Agreement, all amounts then remaining unpaid on this Note shall become, or may
be declared to be, immediately due and payable all as provided in the Credit
Agreement. Revolving Credit Loans made by the Lender shall be evidenced by one
or more loan accounts or records maintained by the Lender in the ordinary course
of business. The Lender may also attach schedules to this Note and endorse
thereon the date, amount and maturity of its Revolving Credit Loans and payments
with respect thereto; provided, that any failure to so attach or endorse or any
error in doing so shall not limit or otherwise affect the obligation of the
Borrower hereunder and under the other Loan Documents to pay any amount owing
with respect to the Obligations.

The Borrower, for itself, its successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
non-payment of this Note.

 

 

[Exhibit C to ABL Credit Agreement]

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

THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.

 

BASIC ENERGY SERVICES, INC.

By:    

Name:   Title:  

 

 

[Exhibit C to ABL Credit Agreement]

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

EXHIBIT D

FORM OF COMPLIANCE CERTIFICATE

Financial Statement Date:                     ,         

To: Bank of America, N.A., as Administrative Agent

Ladies and Gentlemen:

Reference is made to that certain ABL Credit Agreement, dated as of October 2,
2018 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the “Credit Agreement”; the terms defined therein
being used herein as therein defined), among Basic Energy Services, Inc., a
Delaware corporation (the “Borrower”), the Lenders from time to time party
thereto and Bank of America, N.A., as Administrative Agent, Swing Line Lender
and an L/C Issuer.

The undersigned hereby certifies as of the date hereof that he/she is the [Chief
Executive Officer][Chief Financial Officer][Treasurer][Controller] of the
Borrower, and that, as such, he/she is authorized to execute and deliver this
Compliance Certificate to the Administrative Agent on the behalf of the
Borrower, and that:

[Use following paragraph 1 f or fiscal year-end financial statements]

1. The Borrower has delivered the year-end audited financial statements required
by Section 6.01(a) of the Credit Agreement for the fiscal year of the Borrower
ended as of the above date, together with the report and opinion of an
independent certified public accountant required by such section.

[Use following paragraph 1 f or fiscal quarter-end financial statements]

1. The Borrower has delivered the unaudited financial statements required by
Section 6.01(b) of the Credit Agreement for the fiscal quarter of the Borrower
ended as of the above date. Such financial statements fairly present in all
material respects the financial condition, results of operations, shareholders’
equity and cash flows of the Borrower and its Subsidiaries in accordance with
GAAP as at such date and for such period, subject only to normal year-end audit
adjustments and the absence of footnotes.

[Use following paragraph 1 for month-end financial statements if a

Monthly Financial Reporting Trigger Period is in effect]

1. The Borrower has delivered the unaudited financial statements required by
Section 6.01(c) of the Credit Agreement for the month ended as of the above
date. Such financial statements fairly present in all material respects the
financial condition, results of operations, shareholders’ equity and cash flows
of the Borrower and its Subsidiaries in accordance with GAAP as at such date and
for such period, subject only to normal year-end audit adjustments and the
absence of footnotes.

 

[Exhibit D to ABL Credit Agreement]

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

2. The undersigned has reviewed and is familiar with the terms of the Credit
Agreement and has made, or has caused to be made under his/her supervision, a
detailed review of the transactions and condition (financial or otherwise) of
the Borrower during the accounting period covered by such financial statements.

3. A review of the activities of the Borrower during such fiscal period has been
made under the supervision of the undersigned with a view to determining whether
during such fiscal period the Borrower performed and observed all its
Obligations under the Loan Documents, and

[select one:]

[to the best knowledge of the undersigned, during such fiscal period the
Borrower performed and observed each covenant and condition of the Loan
Documents applicable to it, and no Default has occurred and is continuing.]

--or-

[to the best knowledge of the undersigned, the following covenants or conditions
have not been performed or observed and the following is a list of each such
Default and its nature and status:]

4. The representations and warranties of the Borrower and each other Loan Party
contained in Article V of the Credit Agreement or any other Loan Document, or
which are contained in any document furnished at any time under or in connection
with any Loan Document, are true and correct on and as of the date hereof,
except to the extent that such representations and warranties specifically refer
to an earlier date, in which case they are true and correct as of such earlier
date, and except that for purposes of this Compliance Certificate, the
representations and warranties contained in Sections 5.05(a) and (b) of the
Credit Agreement shall be deemed to refer to the most recent statements
furnished pursuant to Sections 6.01(a), (b) and (c) of the Credit Agreement,
respectively.

5. The financial covenant analyses and information set forth on Schedules 1 and
2 attached hereto are true and accurate on and as of the date of this Compliance
Certificate.

 

 

[Exhibit D to ABL Credit Agreement]

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

IN WITNESS WHEREOF, the undersigned has executed this Compliance Certificate as
of             ,         _.

 

BASIC ENERGY SERVICES, INC.

By:       Name:   Title:

 

 

[Exhibit D to ABL Credit Agreement]

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

For the Quarter/Year/Month ended                                     ,         
(“Statement Date”)

SCHEDULE 1

to the Compliance Certificate

($ in 000’s)

 

I.   Section 7.11 – Consolidated Fixed Charge Coverage Ratio.

  

A. Consolidated EBITDA for Measurement Period (Line I.B. above):

   $                

B. Capital Expenditures for Subject Period (except those financed with borrowed
money other than Revolving Credit Loans and Equity Proceeds) and cash taxes
paid:

   $                

C. Line A minus Line B:

   $                

D. Consolidated Interest Charges (other than payment-in-kind or amortization of
fees and other non-cash items treated as interest in accordance with GAAP) for
the Measurement Period:

   $                

E.  Scheduled principal payments and voluntary prepayments on borrowed money
(including purchase money Indebtedness, Attributable Indebtedness and the
deferred purchase price of property or services) during Measurement Period:

   $                

F.  Restricted Payments made during Measurement Period:

   $                

G. Consolidated Fixed Charges for the Measurement Period (Lines D plus Line E
plus Line F):

   $                

H. Consolidated Fixed Charge Coverage Ratio (Line C divided by Line G):

              to 1  

Minimum required:

     1.00 to 1  

 

 

[Exhibit D to ABL Credit Agreement]

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

For the Quarter/Year/Month ended                                         

(“Statement Date”)

SCHEDULE 2

to the Compliance Certificate

($ in 000’s)

Consolidated EBITDA

(in accordance with the definition of Consolidated EBITDA

as set forth in the Credit Agreement)

 

Consolidated

EBITDA

  

Quarter

Ended

  

Quarter

Ended

  

Quarter
Ended

  

Quarter
Ended

  

Twelve
Months
Ended

Consolidated Net Income

              

+ Consolidated Interest Charges

              

+ income taxes

              

+ depreciation expense

              

+ amortization expense

              

+ non-cash expenses

              

+ non-cash stock-based compensation expenses

              

+ costs of refinancing loans pursuant to the Term Loan Agreement and Receivables
Facility Agreement

              

+ amount expensed in connection with tender for / redemption of loans pursuant
to the Term Loan Agreement and Receivables Facility Agreement

              

+ (a) reasonable and customary fees, expenses, charges or losses (other than
depreciation and amortization) related to any public or private sale of
(i) Qualified Capital Stock or options, warrants or rights made for cash,
(ii) Material Acquisitions, (iii) Material Dispositions or the (iv) incurrence
of Indebtedness permitted to be incurred under the Credit Agreement (including
refinancings thereof), and including fees, expenses, charges and losses related
to the offering of Senior Notes and the Indebtedness incurred under the Credit
Agreement, and any amendment of the Senior Notes or Loan Documents), in each
case, to the extent deducted and not added back to Consolidated Net Income)

              

+(b) the amount of any restructuring charge or reserve, integration cost or
other business optimization expense and severance costs during such Measurement
Period (a + b not to exceed 15% of Consolidated EBITDA for such Measurement
Period)

              

-income tax credits

              

-non-cash income

              

= Consolidated EBITDA

              

 

 

[Exhibit D to ABL Credit Agreement]

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

EXHIBIT E-1

ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption (this “Assignment and Assumption”) is dated as of
the Effective Date set forth below and is entered into by and between
[the][each]1 Assignor identified in item 1 below ([the][each, an] “Assignor”)
and [the][each]2 Assignee identified in item 2 below ([the][each, an]
“Assignee”). [It is understood and agreed that the rights and obligations of
[the Assignors][the Assignees]3 hereunder are several and not joint.]4
Capitalized terms used but not defined herein shall have the meanings given to
them in the ABL Credit Agreement identified below (the “Credit Agreement”),
receipt of a copy of which is hereby acknowledged by the Assignee. The Standard
Terms and Conditions set forth in Annex 1 attached hereto (the “Standard Terms
and Conditions”) are hereby agreed to and incorporated herein by reference and
made a part of this Assignment and Assumption as if set forth herein in full.

For an agreed consideration, [the][each] Assignor hereby irrevocably sells and
assigns to [the Assignee][the respective Assignees], and [the][each] Assignee
hereby irrevocably purchases and assumes from [the Assignor][the respective
Assignors], subject to and in accordance with the Standard Terms and Conditions
and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below (i) all of [the Assignor’s][the
respective Assignors’] rights and obligations in [its capacity as a
Lender][their respective capacities as Lenders] under the Credit Agreement and
any other documents or instruments delivered pursuant thereto to the extent
related to the amount and percentage interest identified below of all of such
outstanding rights and obligations of [the Assignor][the respective Assignors]
under the respective facilities identified below (including, without limitation,
the Letters of Credit and the Swing Line Loans included in such facilities) and
(ii) to the extent permitted to be assigned under applicable law, all claims,
suits, causes of action and any other right of [the Assignor (in its capacity as
a Lender)][the respective Assignors (in their respective capacities as Lenders)]
against any Person, whether known or unknown, arising under or in connection
with the Credit Agreement, any other documents or instruments delivered pursuant
thereto or the loan transactions governed thereby or in any way based on or
related to any of the foregoing, including, but not limited to, contract claims,
tort claims, malpractice claims, statutory claims and all other claims at law or
in equity related to the rights and obligations sold and assigned pursuant to
clause (i) above (the rights and obligations sold and assigned by [the][any]
Assignor to [the][any] Assignee pursuant to clauses (i) and (ii) above being
referred to herein collectively as [the][an] “Assigned Interest”). Each such
sale and assignment is without recourse to [the][any] Assignor and, except as
expressly provided in this Assignment and Assumption, without representation or
warranty by [the][any] Assignor.

 

1 

For bracketed language here and elsewhere in this form relating to the
Assignor(s), if the assignment is from a single Assignor, choose the first
bracketed language. If the assignment is from multiple Assignors, choose the
second bracketed language.

2 

For bracketed language here and elsewhere in this form relating to the
Assignee(s), if the assignment is to a single Assignee, choose the first
bracketed language. If the assignment is to multiple Assignees, choose the
second bracketed language.

3 

Select as appropriate.

4 

Include bracketed language if there are either multiple Assignors or multiple
Assignees.

 

[Exhibit E-1 to ABL Credit Agreement]

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

1.  Assignor[s]:

                                                                                
                                            
                                         

2.  Assignee[s]:

                                                                                
                                            
                                         

       [for each Assignee, indicate [Affiliate][Approved Fund] of [identify
Lender]]

3.  Borrower:

  

Basic Energy Services, Inc.

  

4.  Administrative Agent:

   Bank of America, N.A., as the Administrative Agent under the Credit Agreement
  

5.  Credit Agreement: ABL Credit Agreement, dated as of October 2, 2018, among
Basic Energy Services, Inc., as Borrower, the Lenders from time to time party
thereto, and Bank of America, N.A., as Administrative Agent, Swing Line Lender
and an L/C Issuer

6.  Assigned Interest:

     

 

Assignor[s]5

   Assignee[s]6      Facility
Assigned      Aggregate
Amount of
Commitment/Loans
for all Lenders7      Amount of
Commitment
/Loans
Assigned      Percentage
Assigned of
Commitment/
Loans8      CUSIP
Number            $        $          %               $        $          %     
         $        $          %     

 

[7.   Trade Date:

                                         
                                      ]9   

Effective Date (the “Effective Date”):                             , 20     [TO
BE INSERTED BY THE ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF
RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]

[signature page follows]

 

5 

List each Assignor, as appropriate.

6 

List each Assignee, as appropriate.

7 

Amounts in this column and in the column immediately to the right to be adjusted
by the counterparties to take into account any payments or prepayments made
between the Trade Date and the Effective Date.

8 

Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of
all Lenders thereunder.

9 

To be completed if the Assignor and the Assignee intend that the minimum
assignment amount is to be determined as of the Trade Date.

 

[Exhibit E-1 to ABL Credit Agreement]

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

The terms set forth in this Assignment and Assumption are hereby agreed to as of
the Effective Date:

 

ASSIGNOR [NAME OF ASSIGNOR]

By:    

Title:   ASSIGNEE [NAME OF ASSIGNEE]

By:     Title:    

Consented to and accepted:

 

BANK OF AMERICA, N.A.,

as Administrative Agent, Swing Line Lender

and an L/C Issuer

By:     Title:  

[UBS AG, STAMFORD BRANCH],

as L/C Issuer

By:     Title:   By:     Title:  

[PNC BANK, NATIONAL ASSOCIATION],

as L/C Issuer

By:     Title:  

[ADDITIONAL ISSUING BANK]10,

as L/C Issuer

By:     Title:  

 

10 

To be executed by each applicable L/C Issuer.

 

[Exhibit E-1 to ABL Credit Agreement]

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

[BASIC ENERGY SERVICES, INC.

By:     Title:       ]11

 

11 

To be added only if the consent of the Borrower is required by the terms of the
Credit Agreement.

 

[Exhibit E-1 to ABL Credit Agreement]

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

ANNEX 1 TO ASSIGNMENT AND ASSUMPTION

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

1. Representations and Warranties.

1.1. Assignor. [The][Each] Assignor (a) represents and warrants that (i) it is
the legal and beneficial owner of [the][[the relevant] Assigned Interest, (ii)
[the][such] Assigned Interest is free and clear of any lien, encumbrance or
other adverse claim and (iii) it has full power and authority, and has taken all
action necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or representations
made in or in connection with the Credit Agreement or any other Loan Document,
(ii) the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Loan Documents or any collateral thereunder, (iii) the financial
condition of the Borrower, any of its Subsidiaries or Affiliates or any other
Person obligated in respect of any Loan Document or (iv) the performance or
observance by the Borrower, any of its Subsidiaries or Affiliates or any other
Person of any of their respective obligations under any Loan Document.

1.2. Assignee. [The][Each] Assignee (a) represents and warrants that (i) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby and to become a Lender under the Credit Agreement, (ii) it
meets all the requirements to be an assignee under Section 10.06(b)(iii), (v)
[and (vi)] of the Credit Agreement (subject to such consents, if any, as may be
required under Section 10.06(b)(iii) of the Credit Agreement), (iii) from and
after the Effective Date, it shall be bound by the provisions of the Credit
Agreement as a Lender thereunder and, to the extent of [the][the relevant]
Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it is
sophisticated with respect to decisions to acquire assets of the type
represented by [the][such] Assigned Interest and either it, or the Person
exercising discretion in making its decision to acquire [the][such] Assigned
Interest, is experienced in acquiring assets of such type, (v) it has received a
copy of the Credit Agreement, and has received or has been accorded the
opportunity to receive copies of the most recent financial statements delivered
pursuant to Section 6.01 thereof, as applicable, and such other documents and
information as it deems appropriate to make its own credit analysis and decision
to enter into this Assignment and Assumption and to purchase [the][such]
Assigned Interest, (vi) it has, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Assignment and Assumption and to purchase
[the][such] Assigned Interest, and (vii) if it is a Foreign Lender, attached
hereto is any documentation required to be delivered by it pursuant to the terms
of the Credit Agreement, duly completed and executed by [the][such] Assignee;
and (b) agrees that (i) it will, independently and without reliance upon the
Administrative Agent, [the][any] Assignor or any other Lender, and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Loan
Documents, and (ii) it will perform in accordance with their terms all of the
obligations which by the terms of the Loan Documents are required to be
performed by it as a Lender.

[Exhibit E-1 to ABL Credit Agreement]

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

2. Payments. From and after the Effective Date, the Administrative Agent shall
make all payments in respect of [the][each] Assigned Interest (including
payments of principal, interest, fees and other amounts) to [the][the relevant]
Assignor for amounts which have accrued to but excluding the Effective Date and
to [the][the relevant] Assignee for amounts which have accrued from and after
the Effective Date.

3. General Provisions. This Assignment and Assumption shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and
assigns. This Assignment and Assumption may be executed in any number of
counterparts, which together shall constitute one instrument. Delivery of an
executed counterpart of a signature page of this Assignment and Assumption by
telecopy or other electronic transmission shall be effective as delivery of a
manually executed counterpart of this Assignment and Assumption. This Assignment
and Assumption shall be governed by, and construed in accordance with, the law
of the State of New York.

[Exhibit E-1 to ABL Credit Agreement]

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

EXHIBIT E-2

ADMINISTRATIVE QUESTIONNAIRE

[Attached]

Exhibit E-2 to Credit Agreement

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

EXHIBIT F

FORM OF NOTICE OF LOAN PREPAYMENT

 

TO:

Bank of America, N.A., as [Administrative Agent][Swing Line Lender]

 

RE:

ABL Credit Agreement, dated as of October 2, 2018, among Basic Energy Services,
Inc., a Delaware corporation (the “Borrower”), the Lenders from time to time
party thereto, and Bank of America, N.A., as Administrative Agent, Swing Line
Lender and an L/C Issuer (as amended, restated, extended, supplemented or
otherwise modified in writing from time to time, the “Credit Agreement”)

 

DATE:

[Date]

The Borrower hereby notifies the Administrative Agent that on
_________________1, pursuant to the terms of Section 2.05 of the Credit
Agreement, the Borrower intends to prepay/repay the following Revolving Credit
Loans as more specifically set forth below:

 

  ☐

Optional prepayment of Revolving Credit Loans in the following amount(s):

 

  ☐

LIBOR Loans: $_____________________________2

Applicable Interest Period: _____________________

 

  ☐

Base Rate Loans: $_____________________________3

 

  ☐

Optional prepayment of Swing Line Loans in the following amount:
$_____________________________4

Delivery of an executed counterpart of a signature page of this notice by fax
transmission or other electronic mail transmission (e.g. “pdf” or “tif”) shall
be effective as delivery of a manually executed counterpart of this notice.

[Signature page follows]

 

 

1 

Specify date of such prepayment.

2 

Any prepayment of LIBOR Loans shall be in a principal amount of $5,000,000 or a
whole multiple of $1,000,000 in excess thereof (or if less, the entire principal
amount thereof outstanding).

3 

Any prepayment of Base Rate Loans shall be in a principal amount of $500,000 or
a whole multiple of $100,000 in excess thereof (or if less, the entire principal
amount thereof outstanding).

4 

Any prepayment of Swing Line Loans shall be in a minimum principal amount of
$100,000 (or if less, the entire principal amount thereof outstanding).

[Exhibit F to ABL Credit Agreement]

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

BASIC ENERGY SERVICES, INC.

By:    

Name:   Title:  

[Exhibit F to ABL Credit Agreement]

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

EXHIBIT G

FORM OF SECURED PARTY DESIGNATION NOTICE

 

TO:

Bank of America, N.A., as Administrative Agent

 

RE:

ABL Credit Agreement, dated as of October 2, 2018 among Basic Energy Services,
Inc., a Delaware corporation (the “Borrower”), the Lenders from time to time
party thereto, and Bank of America, N.A., as Administrative Agent, a Swing Line
Lender and an L/C Issuer (as amended, restated, extended, supplemented or
otherwise modified in writing from time to time, the “Credit Agreement”)

 

DATE:

[Date] (the “Effective Date”)

[Name of Cash Management Bank/Hedge Bank] (the “Secured Party”) hereby notifies
you, pursuant to the terms of the Credit Agreement, that the Secured Party meets
the requirements of a [Cash Management Bank] [Hedge Bank] under the terms of the
Credit Agreement and is a [Cash Management Bank] [Hedge Bank] under the Credit
Agreement and the other Loan Documents. The Secured Party hereby agrees to be
bound by Section 9.11 of the Credit Agreement.

[Describe Secured Cash Management Agreement or the Secured Hedge Agreement
between the applicable Loan Party and the Secured Party]

 

       

The maximum amount to be secured by the Collateral under the [Secured Cash
Management Agreement][Secured Hedge Agreement] described above is _____________
and the methodology used in calculating such amount is set forth below.

[Include methodology used to calculate maximum amount of the Secured Cash
Management Agreement or Secured Hedge Agreement to be secured by the Collateral]

Delivery of an executed counterpart of a signature page of this notice by fax
transmission or other electronic mail transmission (e.g. “pdf” or “tif”) shall
be effective as delivery of a manually executed counterpart of this notice.

[Exhibit G to ABL Credit Agreement]

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

A duly authorized officer of the undersigned has executed this notice as of the
Effective Date.

 

  as a [Cash Management Bank] [Hedge Bank] By:     Name:     Title:    

[Exhibit G to ABL Credit Agreement]

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

EXHIBIT H

FORM OF LETTER OF CREDIT REPORT

 

TO:

Bank of America, N.A., as Administrative Agent

 

RE:

ABL Credit Agreement, dated as of October 2, 2018, among Basic Energy Services,
Inc., a Delaware corporation (the “Borrower”), the Lenders from time to time
party thereto, and Bank of America, N.A., as Administrative Agent, Swing Line
Lender and an L/C Issuer (as amended, restated, extended, supplemented or
otherwise modified in writing from time to time, the “Credit Agreement”)

 

DATE:

[Date]

The undersigned, [insert name of L/C Issuer] (the “L/C Issuer”) hereby delivers
this report to the Administrative Agent, pursuant to the terms of
Section 2.03(k) of the Credit Agreement.

The L/C Issuer plans to issue, amend, renew, increase or extend the following
Letter(s) of Credit on [insert date].

 

L/C No.

   Maximum
Face
Amount    Current
Face
Amount    Currency    Financials or
Performance
SBLC    Beneficiary
Name    Issuance
Date    Expiry
Date    Auto
Renewal    Date of
Amendment    Amount of
Amendment

[The L/C Issuer made a payment, with respect to L/C No. ________, on [insert
date] in the amount of $[____________].

[The Borrower failed to reimburse the L/C Issuer for a payment made in the
amount of $[insert amount of such payment] pursuant to L/C No. _______ on
[insert date of such failure].]

[Exhibit H to ABL Credit Agreement]

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

Set forth in the table below is a description of each Letter of Credit issued by
the undersigned and outstanding on the date hereof.

 

L/C No.

 

Maximum
Face
Amount

 

Current
Face
Amount

  

Currency

  

Financials
or
Performance
SBLC

  

Beneficiary

Name

  

Issuance
Date

  

Expiry
Date

  

Auto
Renewal

  

Date of
Amendment

  

Amount
of
Amendment

Delivery of an executed counterpart of a signature page of this notice by fax
transmission or other electronic mail transmission (e.g., “pdf” or “tif”) shall
be effective as delivery of a manually executed counterpart of this notice.

 

[L/C ISSUER],

as L/C Issuer

By:     Name:   Title:  

[Exhibit H to ABL Credit Agreement]

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

EXHIBIT I-1

FORM OF U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax
Purposes)

Reference is hereby made to the ABL Credit Agreement, dated as of October 2,
2018 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the “Credit Agreement”) among Basic Energy Services,
Inc., a Delaware corporation (the “Borrower”), the Lenders from time to time
party thereto, and Bank of America, N.A., as Administrative Agent, Swing Line
Lender and an L/C Issuer.

Pursuant to the provisions of Section 3.01 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record and beneficial owner
of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of
which it is providing this certificate, (ii) it is not a bank within the meaning
of Section 881(c)(3)(A) of the Code, (iii) it is not a ten percent shareholder
of the Borrower within the meaning of Section 871(h)(3)(B) of the Code and
(iv) it is not a controlled foreign corporation related to the Borrower as
described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished the Administrative Agent and the Borrower with a
certificate of its non-U.S. Person status on IRS Form W-8BEN or IRS Form
W-8BEN-E (as applicable). By executing this certificate, the undersigned agrees
that (1) if the information provided on this certificate changes, the
undersigned shall promptly so inform the Borrower and the Administrative Agent,
and (2) the undersigned shall have at all times furnished the Borrower and the
Administrative Agent with a properly completed and currently effective
certificate in either the calendar year in which each payment is to be made to
the undersigned, or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF LENDER] By:     Name:   Title:   Date:                       
        ,20[    ]

[Exhibit I-1 to ABL Credit Agreement]

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

EXHIBIT I-2

FORM OF U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax
Purposes)

Reference is hereby made to the ABL Credit Agreement, dated as of October 2,
2018 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the “Credit Agreement”) among Basic Energy Services,
Inc., a Delaware corporation (the “Borrower”), the Lenders from time to time
party thereto, and Bank of America, N.A., as Administrative Agent, Swing Line
Lender and an L/C Issuer.

Pursuant to the provisions of Section 3.01 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record and beneficial owner
of the participation in respect of which it is providing this certificate,
(ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the Code,
(iii) it is not a ten percent shareholder of the Borrower within the meaning of
Section 871(h)(3)(B) of the Code, and (iv) it is not a controlled foreign
corporation related to the Borrower as described in Section 881(c)(3)(C) of the
Code.

The undersigned has furnished its participating Lender with a certificate of its
non-U.S. Person status on IRS Form W-8BEN or IRS Form W-8BEN-E (as applicable).
By executing this certificate, the undersigned agrees that (1) if the
information provided on this certificate changes, the undersigned shall promptly
so inform such Lender in writing, and (2) the undersigned shall have at all
times furnished such Lender with a properly completed and currently effective
certificate in either the calendar year in which each payment is to be made to
the undersigned, or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF PARTICIPANT] By:     Name:   Title:   Date:                       
        ,20[    ]

[Exhibit I-2 to ABL Credit Agreement]

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EXHIBIT I-3

FORM OF U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Partnerships For U.S. Federal Income Tax
Purposes)

Reference is hereby made to the ABL Credit Agreement, dated as of October 2,
2018 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the “Credit Agreement”) among Basic Energy Services,
Inc., a Delaware corporation (the “Borrower”), the Lenders from time to time
party thereto, and Bank of America, N.A., as Administrative Agent, Swing Line
Lender and an L/C Issuer.

Pursuant to the provisions of Section 3.01 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record owner of the
participation in respect of which it is providing this certificate, (ii) its
direct or indirect partners/members are the sole beneficial owners of such
participation, (iii) with respect to such participation, neither the undersigned
nor any of its direct or indirect partners/members is a bank extending credit
pursuant to a loan agreement entered into in the ordinary course of its trade or
business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of
its direct or indirect partners/members is a ten percent shareholder of the
Borrower within the meaning of Section 871(h)(3)(B) of the Code and (v) none of
its direct or indirect partners/members is a controlled foreign corporation
related to the Borrower as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished its participating Lender with IRS Form W-8IMY
accompanied by one of the following forms from each of its partners/members that
is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or IRS Form
W-8BEN-E (as applicable) or (ii) an IRS Form W-8IMY accompanied by an IRS Form
W-8BEN or IRS Form W-8BEN-E (as applicable) from each of such partner’s/member’s
beneficial owners that is claiming the portfolio interest exemption. By
executing this certificate, the undersigned agrees that (1) if the information
provided on this certificate changes, the undersigned shall promptly so inform
such Lender and (2) the undersigned shall have at all times furnished such
Lender with a properly completed and currently effective certificate in either
the calendar year in which each payment is to be made to the undersigned, or in
either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF PARTICIPANT] By:     Name:   Title:   Date:                       
        ,20[    ]

[Exhibit I-3 to ABL Credit Agreement]

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EXHIBIT I-4

FORM OF U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)

Reference is hereby made to the ABL Credit Agreement, dated as of October 2,
2018 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the “Credit Agreement”) among Basic Energy Services,
Inc., a Delaware corporation (the “Borrower”), the Lenders from time to time
party thereto, and Bank of America, N.A., as Administrative Agent, Swing Line
Lender and an L/C Issuer.

Pursuant to the provisions of Section 3.01 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record owner of the Loan(s)
(as well as any Note(s) evidencing such Loan(s)) in respect of which it is
providing this certificate, (ii) its direct or indirect partners/members are the
sole beneficial owners of such Loan(s) (as well as any Note(s) evidencing such
Loan(s)), (iii) with respect to the extension of credit pursuant to the Credit
Agreement or any other Loan Document, neither the undersigned nor any of its
direct or indirect partners/members is a bank extending credit pursuant to a
loan agreement entered into in the ordinary course of its trade or business
within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct
or indirect partners/members is a ten percent shareholder of the Borrower within
the meaning of Section 871(h)(3)(B) of the Code and (v) none of its direct or
indirect partners/members is a controlled foreign corporation related to the
Borrower as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished the Administrative Agent and the Borrower with IRS
Form W-8IMY accompanied by one of the following forms from each of its
partners/members that is claiming the portfolio interest exemption: (i) an IRS
Form W-8BEN or IRS Form W-8BEN-E (as applicable) or (ii) an IRS Form W-8IMY
accompanied by an IRS Form W-8BEN or IRS Form W-8BEN-E (as applicable) from each
of such partner’s/member’s beneficial owners that is claiming the portfolio
interest exemption. By executing this certificate, the undersigned agrees that
(1) if the information provided on this certificate changes, the undersigned
shall promptly so inform the Borrower and the Administrative Agent, and (2) the
undersigned shall have at all times furnished the Borrower and the
Administrative Agent with a properly completed and currently effective
certificate in either the calendar year in which each payment is to be made to
the undersigned, or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF LENDER] By:     Name:   Title:   Date:                       
        ,20[    ]

[Exhibit I-4 to ABL Credit Agreement]

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EXHIBIT J

FORM OF BORROWING BASE CERTIFICATE

 

Basic Energy Services, Inc.      Date Delivered
                                         Current Begin Date
                                         Current End Date     
                                      

BORROWING BASE CERTIFICATE

Line

As of                         

 

1   Gross Accounts

  

2   Less: Total accounts not constituting Eligible Accounts

     

 

 

 

3   Eligible Accounts

  

4   Accounts advance rate

  

5   Accounts availability (Line 3 multiplied by Line 4)

     85.00 %    

 

 

 

6   Gross unbilled Accounts

     

 

 

 

7   Less: Total accounts not constituting Eligible Unbilled Accounts

     

 

 

 

8   Eligible Unbilled Accounts

  

9   Unbilled Accounts advance rate

     80.00 %    

 

 

 

10   Unbilled Accounts availability (lesser of Line 8 multiplied by Line 9 and
$30,000,000)

     

 

 

 

11   Total collateral availability (Line 5 plus Line 10)

     

 

 

 

12   Bank Product Reserve

  

13   Rent and Charges Reserve

  

14   Accrued Royalties

  

15   Dilution Reserve

  

16   Aggregate amount of liabilities secured by Liens on the Collateral senior
to the Administrative Agent’s Liens

  

17   Other reserves

     

 

 

 

18   Total Availability Reserve (Sum of Lines 12 through 17)

     

 

 

 

19   Collateral availability less Availability Reserve (Line 11 minus Line 18)

  

20   Aggregate Commitments

     

 

 

 

21   Borrowing Base (lesser of Line 19 and Line 20)

     

 

 

 

Basic Energy Services, Inc., a Delaware corporation (the “Borrower”), by its
duly authorized officer signing below, hereby certifies that (a) the information
set forth in this certificate is true and correct as of the date(s) indicated
herein and (b) the Borrower is in compliance with all terms and provisions
contained in that certain ABL Credit Agreement (as amended, restated,
supplemented or otherwise modified prior to the Effective Date, the “Credit
Agreement”), among the Borrower, the lenders from time to time party thereto and
Bank of America, NA., as administrative agent (the “Administrative Agent”), and
the other Loan Documents (as defined in the Credit Agreement).

 

Authorized Officer:    Title: Authorized Signature:    Date:

Note: If this certificate is being transmitted electronically, the Borrower
acknowledges that by entering the name of its duly authorized officer on this
certificate, such officer has reviewed this certificate in its entirety and
affirmed the representations, warranties and certifications made by such officer
on behalf of the Borrower herein.

[Exhibit J to ABL Credit Agreement]