Exhibit 10.1

FIRST AMENDED AND RESTATED

CREDIT AND GUARANTY AGREEMENT

dated as of August 16, 2005

among

BELDEN & BLAKE CORPORATION,

as Borrower

CERTAIN SUBSIDIARIES OF BELDEN & BLAKE CORPORATION,

as Guarantors,

VARIOUS LENDERS, and

BNP PARIBAS,

as Sole Lead Arranger, Sole Bookrunner,

Sole Syndication Agent and Administrative Agent,

________________________________________________________

$390,000,000 Senior Secured Credit Facilities
________________________________________________________

                 
SECTION 1 DEFI
  NITIONS AND INTERPRETATION 1
       
1.1
  Definitions
    1  
1.2
  Accounting Terms
    32  
1.3
  Interpretation, etc
    33  
SECTION 2
  LOANS AND LETTERS OF CREDIT
    33  
2.1
  [Reserved]     33  
2.2
  Revolving Loans
    33  
2.3
  Borrowing Base
    35  
2.4
  Issuance of Letters of Credit and Hedge Letters of Credit
    37  
2.5
  Pro Rata Shares; Availability of Funds
    43  
2.6
  Use of Proceeds
    43  
2.7
  Evidence of Debt; Register; Lenders' Books and Records; Notes
    44  
2.8
  Interest on Loans
    44  
2.9
  Conversion/Continuation
    46  
2.10
  Default Interest
    47  
2.11
  Fees
    47  
2.12
  Commitment Reductions
    49  
2.13
  Voluntary Prepayments/Commitment Reductions
    49  
2.14
  Mandatory Prepayments/Commitment Reductions.
    50  
2.15
  Application of Prepayments/Reductions
    51  
2.16
  General Provisions Regarding Payments
    51  
2.17
  Ratable Sharing
    52  
2.18
  Making or Maintaining Eurodollar Rate Loans
    53  
2.19
  Increased Costs; Capital Adequacy
    55  
2.20
  Taxes; Withholding, etc
    56  
2.21
  Obligation to Mitigate
    59  
2.22
  Defaulting Lenders
    59  
2.23
  Removal or Replacement of a Lender
    60  
SECTION 3
  CONDITIONS PRECEDENT
    61  
3.1
  Closing Date
    61  
3.2
  Conditions to Each Credit Extension
    65  
SECTION 4
  REPRESENTATIONS AND WARRANTIES
    66  
4.1
  Organization; Requisite Power and Authority; Qualification
    66  
4.2
  Capital Stock and Ownership
    67  
4.3
  Due Authorization
    67  
4.4
  No Conflict
    67  
4.5
  Governmental Consents
    67  
4.6
  Binding Obligation
    68  
4.7
  Historical Financial Statements
    68  
4.8
  [Reserved]     68  
4.9
  No Material Adverse Change
    68  
4.10
  No Restricted Junior Payments
    68  
4.11
  No Reserve Write-downs
    68  
4.12
  Adverse Proceedings, etc
    68  
4.13
  Payment of Taxes
    69  
4.14
  Properties
    69  
4.15
  Environmental Matters
    70  
4.16
  No Defaults
    70  
4.17
  Material Contracts
    71  
4.18
  Governmental Regulation
    71  
4.19
  Margin Stock
    71  
4.20
  Employee Matters
    71  
4.21
  Employee Benefit Plans
    71  
4.22
  Certain Fees
    72  
4.23
  Solvency
    72  
4.24
  Related Agreements
    72  
4.25
  Compliance with Statutes, etc
    73  
4.26
  Future Commitments
    73  
4.27
  Disclosure
    73  
SECTION 5
  AFFIRMATIVE COVENANTS
    73  
5.1
  Financial Statements and Other Reports
    74  
5.2
  Existence
    78  
5.3
  Payment of Taxes and Claims
    78  
5.4
  Maintenance of Properties
    78  
5.5
  Insurance
    78  
5.6
  Books and Records; Inspections
    79  
5.7
  Lenders Meetings
    79  
5.8
  Compliance with Laws
    79  
5.9
  Environmental
    79  
5.10
  Subsidiaries
    81  
5.11
  Additional Material Real Estate Assets
    81  
5.12
  Title Opinions
    82  
5.13
  Swap Agreement
    82  
5.14
  Further Assurances
    82  
5.15
  Non-Consolidation
    83  
SECTION 6
  NEGATIVE COVENANTS
    83  
6.1
  Indebtedness
    83  
6.2
  Liens
    85  
6.3
  Equitable Lien
    87  
6.4
  No Further Negative Pledges
    87  
SECTION 7
  GUARANTY
    93  
7.1
  Guaranty of the Obligations
    93  
7.2
  Contribution by Guarantors
    93  
7.3
  Payment by Guarantors
    94  
7.4
  Liability of Guarantors Absolute
    94  
7.5
  Waivers by Guarantors
    96  
7.6
  Guarantors' Rights of Subrogation, Contribution, etc
    97  
7.7
  Subordination of Other Obligations
    97  
7.8
  Continuing Guaranty
    98  
7.9
  Authority of Guarantors or Company
    98  
7.10
  Financial Condition of Company
    98  
7.11
  Bankruptcy, etc
    98  
7.12
  Discharge of Guaranty Upon Sale of Guarantor
    99  
SECTION 8
  EVENTS OF DEFAULT
    99  
8.1
  Events of Default
    99  
SECTION 9
  AGENTS
    102  
9.1
  Appointment of Agents
    102  
9.2
  Powers and Duties
    103  
9.3
  General Immunity
    103  
9.4
  Agents Entitled to Act as Lender
    104  
9.5
  Lenders' Representations, Warranties and Acknowledgment
    105  
9.6
  Right to Indemnity
    105  
9.7
  Successor Administrative Agent
    105  
9.8
  Collateral Documents and Guaranty
    106  
SECTION 10
  MISCELLANEOUS
    107  
10.1
  Notices
    107  
10.2
  Expenses
    107  
10.3
  Indemnity
    108  
10.4
  Set-Off
    108  
10.5
  Amendments and Waivers
    109  
10.6
  Successors and Assigns; Participations
    111  
10.7
  Independence of Covenants
    114  
10.8
  Survival of Representations, Warranties and Agreements
    114  
10.9
  No Waiver; Remedies Cumulative
    114  
10.10
  Marshalling; Payments Set Aside
    115  
10.11
  Severability
    115  
10.12
  Obligations Several; Independent Nature of Lenders' Rights
    115  
10.13
  Headings
    115  
10.14
  Applicable Law
    115  
10.15
  Consent to Jurisdiction
    115  
10.16
  Waiver of Jury Trial
    116  
10.17
  Confidentiality
    116  
10.18
  Usury Savings Clause
    117  
10.19
  Counterparts
    117  
10.20
  Effectiveness
    118  
10.21
  USA PATRIOT Act
    118  
10.22
  Electronic Execution of Assignments
    118  

         
APPENDICES: A-1
SCHEDULES:
EXHIBITS:
  Revolvi
A-2
B
1.1(a)
1.1(b)
3.1(i)
4.1
4.2
4.13
4.14
4.17
6.1
6.2
6.7
6.12
A-1
A-2
A-3
B-1
B-2
C
D
E
F
G-1
G-2
H
I
J
K
L
M   ng Commitments
Hedge L/C Commitments
Notice Addresses
Existing Mortgages
Existing Title Policies
Closing Date Mortgaged Properties
Company and Subsidiary Information
Capital Stock and Ownership
Taxes
Real Estate Assets; Hydrocarbon Interests
Material Contracts
Certain Indebtedness
Certain Liens
Certain Investments
Certain Affiliate Transactions
Funding Notice
Conversion/Continuation Notice
Issuance Notice
Revolving Loan Note
Hedge L/C Loan Note
Compliance Certificate
Mortgage Supplement
Assignment Agreement
Certificate Re Non-bank Status
Closing Date Certificate
Solvency Certificate
Counterpart Agreement
Pledge and Security Agreement
Owner Pledge Agreement
Mortgage
Landlord Waiver and Consent Agreement
Collateral Trust Agreement

1

FIRST AMENDED AND RESTATED

CREDIT AND GUARANTY AGREEMENT

This First Amended and Restated Credit and Guaranty Agreement dated as of
August 16, 2005 is among Belden & Blake Corporation, an Ohio corporation
(“Company”), certain subsidiaries of the Company, as Guarantors, the Lenders
party hereto from time to time, BNP Paribas (“BNPP”), as Sole Lead Arranger,
Sole Book Runner, Sole Syndication Agent, and Administrative Agent (together
with its permitted successors in such capacity, “Administrative Agent”).

INTRODUCTION

The Company and certain of its Subsidiaries (such terms and each other
capitalized term used but not defined in this Introduction having the meaning
provided in Section 1.1) have entered into the Credit and Guaranty Agreement
dated as of July 7, 2004 and amended as of July 22, 2004 (such agreement, as
further amended, restated, supplemented or otherwise modified prior to the date
hereof, the “Existing Credit Agreement”) with Goldman Sachs Credit Partners
L.P., as sole lead arranger, sole book runner, syndication, and administrative
agent and the other lenders and agents party thereto.

The Company has requested that the parties to the Existing Credit Agreement
assign all of their rights and delegate all of their duties under the Existing
Credit Agreement to the Lenders and the Administrative Agent and that the
Lenders and Administrative Agent amend and restate the terms of the Existing
Credit Agreement, and replace the extensions of credit thereunder (including the
loans and letters of credit governed by the terms of the Existing Credit
Agreement) with this Agreement.

The parties hereto agree that from and after the effectiveness of this
Agreement, the obligations under the Existing Credit Agreement, including the
terms of the extensions of credit outstanding thereunder, shall be continued as,
and evidenced by, the Loans, Letters of Credit, Hedge Letters of Credit, and
other Obligations and Credit Documents.

The Lenders have indicated their willingness to continue extensions of credit
under the Existing Credit Agreement as Loans, Letters of Credit, Hedge Letters
of Credit hereunder, and make additional Loans and continue existing or issue
additional Letters of Credit or Hedge Letters of Credit on the terms and subject
to the conditions set forth herein.

Therefore, in consideration of the premises and the agreements, provisions and
covenants herein contained, the parties hereto agree as follows:

SECTION 1 DEFINITIONS AND INTERPRETATION

1.1 Definitions. The following terms used herein, including in the preamble,
recitals, exhibits and schedules hereto, shall have the following meanings:

"Acceptable Security Interest” in any Property means a Lien which (a) exists in
favor of the Collateral Trustee for the benefit of the Secured Parties, (b) is
superior to all Liens or rights of any other Person in the Property encumbered
thereby other than Permitted Prior Liens, (c) secures the Obligations, and
(d) is perfected and enforceable.

"Accounting Change” has the meaning set forth in Section 1.2(b).

"Acquisition” means the acquisition by EnerVest Energy Institutional Fund X-A,
L.P., EnerVest Energy Institutional Fund X-WI, L.P., and EnerVest Energy
Institutional Fund X-B, L.P. (or their permitted successors and assigns) of all
of the outstanding partnership interests of Capital C Energy Operations, L.P.
pursuant to the terms of the Acquisition Agreement.

"Acquisition Agreement” means the Partnership Interest Purchase Agreement dated
as of July 5, 2005 between Capital C Energy, LP and Capital C Energy Partners,
L.P., as sellers, and EnerVest Energy Institutional Fund X-A, L.P., EnerVest
Energy Institutional Fund X-WI, L.P., and EnerVest Energy Institutional Fund
X-B, L.P., as buyers.

"Adjusted Eurodollar Rate” means, for any Interest Rate Determination Date with
respect to an Interest Period for a Eurodollar Rate Loan, the rate per annum
obtained by dividing (and rounding upward to the next whole multiple of 1/100 of
1%) (i) (a) the rate per annum (rounded to the nearest 1/100 of 1%) equal to the
rate determined by Administrative Agent to be the offered rate which appears on
the page of the Telerate Screen which displays an average British Bankers
Association Interest Settlement Rate (such page currently being page number 3740
or 3750, as applicable) for deposits (for delivery on the first day of such
period) with a term equivalent to such period in Dollars, determined as of
approximately 11:00 a.m. (London, England time) on such Interest Rate
Determination Date, or (b) in the event the rate referenced in the preceding
clause (a) does not appear on such page or service or if such page or service
shall cease to be available, the rate per annum (rounded to the nearest 1/100 of
1%) equal to the rate determined by Administrative Agent to be the offered rate
on such other page or other service which displays an average British Bankers
Association Interest Settlement Rate for deposits (for delivery on the first day
of such period) with a term equivalent to such period in Dollars, determined as
of approximately 11:00 a.m. (London, England time) on such Interest Rate
Determination Date, or (c) in the event the rates referenced in the preceding
clauses (a) and (b) are not available, the rate per annum (rounded to the
nearest 1/100 of 1%) equal to the offered quotation rate to first class banks in
the London interbank market by BNPP for deposits (for delivery on the first day
of the relevant period) in Dollars of amounts in same day funds comparable to
the principal amount of the applicable Loan of Administrative Agent, in its
capacity as a Lender, for which the Adjusted Eurodollar Rate is then being
determined with maturities comparable to such period as of approximately
11:00 a.m. (London, England time) on such Interest Rate Determination Date, by
(ii) an amount equal to (a) one minus (b) the Applicable Reserve Requirement.

"Administrative Agent” has the meaning set forth in the preamble hereto.

"Adverse Proceeding” means any action, suit, proceeding (whether administrative,
judicial or otherwise), investigation or arbitration (whether or not purportedly
on behalf of Company or any of its Subsidiaries) at law or in equity, or before
or by any Governmental Authority, domestic or foreign (including any
Environmental Claims), whether pending or, to the knowledge of Company or any of
its Subsidiaries, threatened against or affecting Company or any of its
Subsidiaries or any property of Company or any of its Subsidiaries.

"Affected Lender” has the meaning set forth in Section 2.18(b).

"Affected Loans” has the meaning set forth in Section 2.18(b).

"Affiliate” means, as applied to any Person, any other Person directly or
indirectly controlling, controlled by, or under common control with, that
Person. For the purposes of this definition, “control” (including, with
correlative meanings, the terms “controlling”, “controlled by” and “under common
control with”), as applied to any Person, means the possession, directly or
indirectly, of the power (i) to vote 10% or more of the Securities having
ordinary voting power for the election of directors of such Person or (ii) to
direct or cause the direction of the management and policies of that Person,
whether through the ownership of voting securities or by contract or otherwise.

"Agent” means each of Syndication Agent, Administrative Agent and Documentation
Agents.

"Aggregate Amounts Due” has the meaning set forth in Section 2.17.

"Aggregate Payments” has the meaning set forth in Section 7.2.

"Agreement” means this First Amended and Restated Credit and Guaranty Agreement,
dated as of August 16, 2005.

"Applicable Margin’’ means on any date of its determination a percentage per
annum, determined by reference to the Utilization in effect at BNPP’s close of
business in New York City on such date for the Type of Loan or the Commitment
Fee as set forth below:

                                      Applicable Margin         Applicable
Margin   for Eurodollar Rate   Applicable Margin Utilization   for Base Rate
Loans   Loans   for Commitment Fees
< 25%
    0.00 %     1.125 %     0.25 %
 
                       
 
                       
> 25%
 
 
 

 
 
 
 

< 50%
    0.00 %     1.375 %     0.25 %
 
                       
 
                       
> 50%
 
 
 

 
 
 
 

< 75%
    0.125 %     1.625 %     0.30 %
 
                       
 
                       
> 75%
 
 
 

 
 
 
 

< 90%
    0.375 %     1.875 %     0.375 %
 
                       
 
                       
> 90%
    0.625 %     2.125 %     0.375 %
 
                       

The Applicable Margin shall increase by 2.00% during any Deficiency Period.

"Applicable Reserve Requirement” means, at any time, for any Eurodollar Rate
Loan, the maximum rate, expressed as a decimal, at which reserves (including,
without limitation, any basic marginal, special, supplemental, emergency or
other reserves) are required to be maintained with respect thereto against
“Eurocurrency liabilities” (as such term is defined in Regulation D) under
regulations issued from time to time by the Board of Governors of the Federal
Reserve System or other applicable banking regulator. Without limiting the
effect of the foregoing, the Applicable Reserve Requirement shall reflect any
other reserves required to be maintained by such member banks with respect to
(i) any category of liabilities which includes deposits by reference to which
the applicable Adjusted Eurodollar Rate or any other interest rate of a Loan is
to be determined, or (ii) any category of extensions of credit or other assets
which include Eurodollar Rate Loans. A Eurodollar Rate Loan shall be deemed to
constitute Eurocurrency liabilities and as such shall be deemed subject to
reserve requirements without benefits of credit for proration, exceptions or
offsets that may be available from time to time to the applicable Lender. The
rate of interest on Eurodollar Rate Loans shall be adjusted automatically on and
as of the effective date of any change in the Applicable Reserve Requirement.

"Applications” has the meaning set forth in Section 2.4(l).

"Asset Sale” means a sale, lease or sub-lease (as lessor or sublessor), sale and
leaseback, assignment, conveyance, transfer or other disposition to, or any
exchange of property with, any Person (other than Company or any Guarantor), in
one transaction or a series of transactions, of all or any part of Company’s or
any of its Restricted Subsidiaries’ businesses, assets or properties of any
kind, including Production Payments, whether real, personal, or mixed and
whether tangible or intangible, whether now owned or hereafter acquired,
including, without limitation, the Capital Stock of any of Company’s Restricted
Subsidiaries, other than (i) Hydrocarbons (or other assets) sold or leased in
the ordinary course of business (excluding any such sales by operations or
divisions discontinued or to be discontinued), and (ii) sales of other assets
for aggregate consideration of less than $1,000,000 with respect to any
transaction or series of related transactions and less than $5,000,000 in the
aggregate during any Fiscal Year.

"Assignment Agreement” means an Assignment and Assumption Agreement
substantially in the form of Exhibit E, with such amendments or modifications as
may be approved by Administrative Agent.

"Assignment Effective Date” has the meaning set forth in Section 10.6(b).

"Authorized Officer” means, as applied to any Person, any individual holding the
position of chairman of the board (if an officer), chief executive officer,
president or one of its vice presidents (or the equivalent thereof), and such
Person’s chief financial officer or treasurer.

"Bankruptcy Code” means Title 11 of the United States Code entitled
“Bankruptcy,” as now and hereafter in effect, or any successor statute.

"Base Rate” means, for any day, a rate per annum equal to the greater of (i) the
Prime Rate in effect on such day and (ii) the Federal Funds Effective Rate in
effect on such day plus 1/2 of 1%. Any change in the Base Rate due to a change
in the Prime Rate or the Federal Funds Effective Rate shall be effective on the
effective day of such change in the Prime Rate or the Federal Funds Effective
Rate, respectively.

"Base Rate Loan” means a Loan bearing interest at a rate determined by reference
to the Base Rate.

"Beneficiary” means each Agent, Issuing Bank, Lender and Lender Counterparty.

"BNPP” has the meaning set forth in the preamble hereto.

"Borrowing Base” means at any particular time, the lesser of (a) the Dollar
amount determined in accordance with Section 2.3 on account of Proven Reserves
attributable to Oil and Gas Properties of the Company and the Guarantors subject
to an Acceptable Security Interest and described in the most recent Independent
Engineering Report or Internal Engineering Report, as applicable, delivered to
the Administrative Agent and the Lenders pursuant to Section 2.3, before taking
into account any reduction to such amount based on the principal amount of the
Senior Secured Notes then outstanding, less 30% of the outstanding principal
amount of the Senior Secured Notes; (b) amount of the Permitted First Priority
Secured Indebtedness, as such term is defined in the J. Aron Swap; and (c) such
amount as may be designated in writing by the Company to the Administrative
Agent and the Revolving Lenders upon any redetermination under
Section 2.3(b)(ii).

"Business Day” means (i) any day excluding Saturday, Sunday and any day which is
a legal holiday under the laws of the State of New York or is a day on which
banking institutions located in such state are authorized or required by law or
other governmental action to close and (ii) with respect to all notices,
determinations, fundings and payments in connection with the Adjusted Eurodollar
Rate or any Eurodollar Rate Loans, the term “Business Day” shall mean any day
which is a Business Day described in clause (i) and which is also a day for
trading by and between banks in Dollar deposits in the London interbank market.

"Capital Lease” means, as applied to any Person, any lease of any property
(whether real, personal or mixed) by that Person as lessee that, in conformity
with GAAP, is or should be accounted for as a capital lease on the balance sheet
of that Person.

"Capital Stock” means any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person (other than a corporation),
including, without limitation, partnership interests and membership interests,
and any and all warrants, rights or options to purchase or other arrangements or
rights to acquire any of the foregoing.

"Cash” means money, currency or a credit balance in any Deposit Account.

"Cash Equivalents” means, as at any date of determination, (i) marketable
securities (a) issued or directly and unconditionally guaranteed as to interest
and principal by the United States Government or (b) issued by any agency of the
United States the obligations of which are backed by the full faith and credit
of the United States, in each case maturing no more than one year after such
date; (ii) marketable direct obligations issued by any state of the United
States of America or any political subdivision of any such state or any public
instrumentality thereof, in each case maturing no more than one year after such
date and having, at the time of the acquisition thereof, a rating of at least
A-1 from S&P or at least P-1 from Moody’s; (iii) commercial paper maturing no
more than one year from the date of creation thereof and having, at the time of
the acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from
Moody’s; (iv) certificates of deposit or bankers’ acceptances maturing no more
than one year after such date and issued or accepted by any Lender or by any
commercial bank organized under the laws of the United States of America or any
state thereof or the District of Columbia that (a) is at least “adequately
capitalized” (as defined in the regulations of its primary Federal banking
regulator) and (b) has Tier 1 capital (as defined in such regulations) of not
less than $100,000,000; and (v) shares of any money market mutual fund that
(a) has substantially all of its assets invested continuously in the types of
investments referred to in clauses (i) and (ii) above, (b) has net assets of not
less than $500,000,000, and (c) has the highest rating obtainable from either
S&P or Moody’s.

"Certificate re Non-Bank Status” means a certificate substantially in the form
of Exhibit F.

"Change of Control” means, at any time, (i) EnerVest shall cease to beneficially
own and control at least 60% on a fully diluted basis of the economic and voting
interests in the Capital Stock of Company; (ii) the majority of the seats (other
than vacant seats) on the board of directors (or similar governing body) of
Company cease to be occupied by Persons who either (a) were members of the board
of directors of Company on the Closing Date or (b) were nominated for election
by the board of directors of Company, a majority of whom were directors on the
Closing Date or whose election or nomination for election was previously
approved by a majority of such directors (in each case after giving effect to
any changes in the members of the board of directors of Company contemplated to
occur in connection with the Acquisition); or (iii) any “change of control” or
similar event under the Senior Secured Notes shall occur.

"Class” means (i) with respect to Lenders, each of the following classes of
Lenders: (a) Lenders having Revolving Exposure and (b) Lenders having Hedge L/C
Exposure, and (ii) with respect to Loans, each of the following classes of
Loans: (a) Revolving Loans and (b) Hedge L/C Loans.

"Closing Date” means the date on which the conditions precedent set forth in
Section 3.1 shall have been satisfied or waived.

"Closing Date Certificate” means a Closing Date Certificate substantially in the
form of Exhibit G-1.

"Closing Date Mortgaged Property” has the meaning set forth in Section 3.1(i).

"Collateral” means, collectively, all of the real, personal and mixed property
(including Capital Stock) in which Liens are purported to be granted pursuant to
the Collateral Documents as security for the Obligations.

"Collateral Documents” means the Pledge and Security Agreement, the Owner Pledge
Agreement, the Mortgages, the Landlord Personal Property Collateral Access
Agreements, if any, the Collateral Trust Agreement and all other instruments,
documents and agreements delivered by any Credit Party pursuant to this
Agreement or any of the other Credit Documents in order to grant to Collateral
Trustee, for the benefit of the Secured Parties, a Lien on any real, personal or
mixed property of that Credit Party as security for the Obligations.

"Collateral Trust Agreement” means a Collateral Trust Agreement substantially in
the form of Exhibit M.

"Collateral Trustee” means Wells Fargo Bank, N.A. and any successor Collateral
Trustee under the Collateral Trust Agreement.

"Commitment” means any Revolving Commitment or Hedge L/C Commitment.

"Company” has the meaning set forth in the preamble hereto.

"Compliance Certificate” means a Compliance Certificate substantially in the
form of Exhibit C.

"Consolidated Adjusted EBITDA” means, for any period, an amount determined for
Company and its Restricted Subsidiaries on a consolidated basis equal to
(i) Consolidated Net Income plus (ii) the sum, without duplication and to the
extent deducted in determining Consolidated Net Income, of the amounts for such
period of (a) Consolidated Interest Expense, (b) provisions for taxes based on
income, (c) total depreciation, depletion and impairment expense, (d) total
amortization expense, and (e) other non-Cash items reducing Consolidated Net
Income (excluding any such non-Cash item to the extent that it represents an
accrual or reserve for potential Cash items in any future period or amortization
of a prepaid Cash item that was paid in a prior period), and (f) costs and
expenses related to the Acquisition not to exceed $10,000,000 minus (iii) other
non-Cash items increasing Consolidated Net Income for such period (excluding any
such non-Cash item to the extent it represents the reversal of an accrual or
reserve for potential Cash item in any prior period).

"Consolidated Capital Expenditures” means, for any period, the aggregate of all
expenditures of Company and its Restricted Subsidiaries during such period
determined on a consolidated basis that, in accordance with GAAP, are or should
be included in “purchase of property and equipment” or “capital expenditures” or
similar items in the consolidated statement of cash flows of Company and its
Restricted Subsidiaries. Consolidated Capital Expenditures shall not include
expenditures of insurance proceeds to rebuild or replace assets of Company and
its Restricted Subsidiaries that have been damaged or destroyed.

"Consolidated Cash Interest Expense” means, for any period, Consolidated
Interest Expense for such period, excluding any amounts paid in kind under the
Qualified Junior Debt, and excluding Restricted Junior Payments permitted under
the terms of Section 6.5 hereof.

"Consolidated EBITDAX” means, for any period, (i) Consolidated Adjusted EBITDA
for such period plus (ii) exploration expense to the extent deducted in
determining Consolidated Net Income for such period.

"Consolidated Interest Expense” means, for any period, total interest expense
(including that portion attributable to Capital Leases in accordance with GAAP
and capitalized interest net of payments received under Interest Rate
Agreements) of Company and its Restricted Subsidiaries on a consolidated basis
with respect to all outstanding Indebtedness of Company and its Restricted
Subsidiaries, including all commissions, discounts and other fees and charges
owed with respect to letters of credit and net costs under Interest Rate
Agreements, but excluding, however, any amounts referred to in Section 2.11(e)
payable on or before the Closing Date].

"Consolidated Net Income” means, for any period, (i) the net income (or loss) of
Company and its Restricted Subsidiaries on a consolidated basis for such period
taken as a single accounting period determined in conformity with GAAP, without
giving effect to (ii) (a) the income (or loss) of any Person (other than a
Restricted Subsidiary of Company) in which any other Person (other than Company
or any of its Restricted Subsidiaries) has a joint interest, except to the
extent of the amount of dividends or other distributions actually paid to
Company or any of its Restricted Subsidiaries by such Person during such period,
(b) the income (or loss) of any Person accrued prior to the date it becomes a
Restricted Subsidiary of Company or is merged into or consolidated with Company
or any of its Restricted Subsidiaries or that Person’s assets are acquired by
Company or any of its Restricted Subsidiaries, (c) the income of any Restricted
Subsidiary of Company to the extent that the declaration or payment of dividends
or similar distributions by that Restricted Subsidiary of that income is not at
the time permitted by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation
applicable to that Restricted Subsidiary, (d) any after-tax gains or losses
attributable to Asset Sales or returned surplus assets of any Pension Plan,
(e) any unrealized non-cash gains or losses attributable to mark-to-market
treatment of derivatives (including those resulting from the application of FAS
133), and (f) (to the extent not included in clauses (a) through (e) above) any
net extraordinary gains or net extraordinary losses.

"Consolidated Total Debt” means, as at any date of determination, the aggregate
stated balance sheet amount of all Indebtedness of Company and its Restricted
Subsidiaries determined on a consolidated basis in accordance with GAAP,
excluding Qualified Junior Debt.

"Contractual Obligation” means, as applied to any Person, any provision of any
Security issued by that Person or of any indenture, mortgage, deed of trust,
contract, undertaking, agreement or other instrument to which that Person is a
party or by which it or any of its properties is bound or to which it or any of
its properties is subject.

"Contributing Guarantors” has the meaning set forth in Section 7.2.

"Conversion/Continuation Date” means the effective date of a continuation or
conversion, as the case may be, as set forth in the applicable
Conversion/Continuation Notice.

"Conversion/Continuation Notice” means a Conversion/Continuation Notice
substantially in the form of Exhibit A-2.

"Counterpart Agreement” means a Counterpart Agreement substantially in the form
of Exhibit H delivered by a Credit Party pursuant to Section 5.10.

"Credit Date” means the date of a Credit Extension.

"Credit Document” means any of this Agreement, the Notes, if any, the Collateral
Documents, any documents or certificates executed by Company in favor of Issuing
Bank relating to Letters of Credit or Hedge Letters of Credit, and all other
documents, instruments or agreements executed and delivered by a Credit Party
for the benefit of any Agent, Issuing Bank or any Lender in connection herewith.

"Credit Extension” means the making of a Loan or the issuing of a Letter of
Credit or Hedge Letter of Credit.

"Credit Party” means each Person (other than any Agent, Issuing Bank or any
Lender or any other representative thereof) from time to time party to a Credit
Document.

"Currency Agreement” means any foreign exchange contract, currency swap
agreement, futures contract, option contract, synthetic cap or other similar
agreement or arrangement, each of which is for the purpose of hedging the
foreign currency risk associated with Company’s and its Restricted Subsidiaries’
operations and not for speculative purposes.

"Current Issuing Bank” has the meaning set forth in Section 2.4(j).

"Default” means a condition or event that, after notice or lapse of time or
both, would constitute an Event of Default.

"Default Excess” means, with respect to any Defaulting Lender, the excess, if
any, of such Defaulting Lender’s Pro Rata Share of the aggregate outstanding
principal amount of Loans or participations in Letters of Credit or Hedge
Letters of Credit of all Lenders (calculated as if all Defaulting Lenders (other
than such Defaulting Lender) had funded all of their respective Defaulted Loans)
over the aggregate outstanding principal amount of all Loans and participations
in Letters of Credit or Hedge Letters of Credit of such Defaulting Lender.

"Default Period” means, with respect to any Defaulting Lender, the period
commencing on the date of the applicable Funding Default and ending on the
earliest of the following dates: (i) the date on which all Commitments are
cancelled or terminated and/or the Obligations are declared or become
immediately due and payable, (ii) the date on which (a) the Default Excess with
respect to such Defaulting Lender shall have been reduced to zero (whether by
the funding by such Defaulting Lender of any Defaulted Loans of such Defaulting
Lender or by the non-pro rata application of any voluntary or mandatory
prepayments of the Loans in accordance with the terms of Section 2.13 or
Section 2.14 or by a combination thereof) and (b) such Defaulting Lender shall
have delivered to Company and Administrative Agent a written reaffirmation of
its intention to honor its obligations hereunder with respect to its
Commitments, and (iii) the date on which Company, Administrative Agent, each
Issuing Bank and Requisite Lenders waive all Funding Defaults of such Defaulting
Lender in writing.

"Defaulted Loan” has the meaning set forth in Section 2.22.

"Defaulting Lender” has the meaning set forth in Section 2.22.

"Deficiency Period” means the period during which the Revolving Exposure exceeds
the Borrowing Base and an Event of Default does not exist.

"Deposit Account” means a demand, time, savings, passbook or like account with a
bank, savings and loan association, credit union or like organization, other
than an account evidenced by a negotiable certificate of deposit.

"Documentation Agents” means each Lender named as a “Documentation Agent” in an
Assignment Agreement.

"Dollar-Denominated Production Payments” means production payment obligations of
Company or any Guarantor which are payable from a specified share of proceeds
received from production from specific Properties, together with all
undertakings and obligations in connection therewith.

"Dollars” and the sign “$” mean the lawful money of the United States of
America.

"Domestic Subsidiary” means any Subsidiary organized under the laws of the
United States of America, any State thereof or the District of Columbia.

"Eligible Assignee” means (i) any Lender, any Affiliate of any Lender and any
Related Fund (any two or more Related Funds being treated as a single Eligible
Assignee for all purposes hereof), and (ii) any commercial bank, insurance
company, investment or mutual fund or other entity that is an “accredited
investor” (as defined in Regulation D under the Securities Act) and which
extends credit or buys loans as one of its businesses; provided, no Affiliate of
Company shall be an Eligible Assignee.

"Employee Benefit Plan” means any “employee benefit plan” as defined in
Section 3(3) of ERISA which is or was sponsored, maintained or contributed to
by, or required to be contributed by, Company, any of its Subsidiaries or any of
their respective ERISA Affiliates.

"Engineering Report” means either an Independent Engineering Report or an
Internal Engineering Report.

"EnerVest” means EnerVest Management Partners, L.P. or one or more of its
managed investment partnerships.

"Environmental Claim” means any investigation, notice, notice of violation,
claim, action, suit, proceeding, demand, abatement order or other order or
directive, by any Governmental Authority or any other Person, arising
(i) pursuant to or in connection with any actual or alleged violation of any
Environmental Law; (ii) in connection with any Hazardous Material or any actual
or alleged Hazardous Materials Activity; or (iii) in connection with any actual
or alleged damage, injury, threat or harm to health, safety, natural resources
or the environment.

"Environmental Laws” means any and all current or future foreign or domestic,
federal or state (or any subdivision of either of them), statutes, ordinances,
orders, rules, regulations, common law, judicial or administrative judgments,
Governmental Authorizations, or any other requirements of Governmental
Authorities relating to (i) pollution, preservation, remediation, protection or
restoration of the environment or natural resources, including those relating to
any Hazardous Materials Activity; (ii) the generation, use, storage,
transportation or disposal of Hazardous Materials; or (iii) occupational safety
and health, industrial hygiene or land use, in any manner applicable to Company
or any of its Subsidiaries or any Facility.

"Environmental Report” means the report entitled Environmental Assessment of
Belden & Blake Corporation] conducted by E.Vironment and dated August 2005.

"ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and any successor thereto.

"ERISA Affiliate” means, as applied to any Person, (i) any corporation which is
a member of a controlled group of corporations within the meaning of Section
414(b) of the Internal Revenue Code of which that Person is a member; (ii) any
trade or business (whether or not incorporated) which is a member of a group of
trades or businesses under common control within the meaning of Section 414(c)
of the Internal Revenue Code of which that Person is a member; and (iii) any
member of an affiliated service group within the meaning of Section 414(m) or
(o) of the Internal Revenue Code of which that Person, any corporation described
in clause (i) above or any trade or business described in clause (ii) above is a
member. Any former ERISA Affiliate of Company or any of its Subsidiaries shall
continue to be considered an ERISA Affiliate of Company or any such Subsidiary
within the meaning of this definition with respect to the period such entity was
an ERISA Affiliate of Company or such Subsidiary and with respect to liabilities
arising after such period for which Company or such Subsidiary could be liable
under the Internal Revenue Code or ERISA.

"ERISA Event” means (i) a “reportable event” within the meaning of Section 4043
of ERISA and the regulations issued thereunder with respect to any Pension Plan
(excluding those for which the provision for 30-day notice to the PBGC has been
waived by regulation); (ii) the failure to meet the minimum funding standard of
Section 412 of the Internal Revenue Code with respect to any Pension Plan
(whether or not waived in accordance with Section 412(d) of the Internal Revenue
Code) or the failure to make by its due date a required installment under
Section 412(m) of the Internal Revenue Code with respect to any Pension Plan or
the failure to make any required contribution to a Multiemployer Plan; (iii) the
provision by the administrator of any Pension Plan pursuant to
Section 4041(a)(2) of ERISA of a notice of intent to terminate such plan in a
distress termination described in Section 4041(c) of ERISA; (iv) the withdrawal
by Company, any of its Subsidiaries or any of their respective ERISA Affiliates
from any Pension Plan with two or more contributing sponsors or the termination
of any such Pension Plan resulting in liability to Company, any of its
Subsidiaries or any of their respective Affiliates pursuant to Section 4063 or
4064 of ERISA; (v) the institution by the PBGC of proceedings to terminate any
Pension Plan, or the occurrence of any event or condition which might constitute
grounds under ERISA for the termination of, or the appointment of a trustee to
administer, any Pension Plan; (vi) the imposition of liability on Company, any
of its Subsidiaries or any of their respective ERISA Affiliates pursuant to
Section 4062(e) or 4069 of ERISA or by reason of the application of Section
4212(c) of ERISA; (vii) the withdrawal of Company, any of its Subsidiaries or
any of their respective ERISA Affiliates in a complete or partial withdrawal
(within the meaning of Sections 4203 and 4205 of ERISA) from any Multiemployer
Plan if there is any potential liability therefore, or the receipt by Company,
any of its Subsidiaries or any of their respective ERISA Affiliates of notice
from any Multiemployer Plan that it is in reorganization or insolvency pursuant
to Section 4241 or 4245 of ERISA, or that it intends to terminate or has
terminated under Section 4041A or 4042 of ERISA; (viii) the occurrence of an act
or omission which could give rise to the imposition on Company, any of its
Subsidiaries or any of their respective ERISA Affiliates of material fines,
penalties, taxes or related charges under Chapter 43 of the Internal Revenue
Code or under Section 409, Section 502(c), (i) or (l), or Section 4071 of ERISA
in respect of any Employee Benefit Plan; (ix) the assertion of a material claim
(other than routine claims for benefits) against any Employee Benefit Plan other
than a Multiemployer Plan or the assets thereof, or against Company, any of its
Subsidiaries or any of their respective ERISA Affiliates in connection with any
Employee Benefit Plan; (x) receipt from the Internal Revenue Service of notice
of the failure of any Pension Plan (or any other Employee Benefit Plan intended
to be qualified under Section 401(a) of the Internal Revenue Code) to qualify
under Section 401(a) of the Internal Revenue Code, or the failure of any trust
forming part of any Pension Plan to qualify for exemption from taxation under
Section 501(a) of the Internal Revenue Code; or (xi) the imposition of a Lien
pursuant to Section 401(a)(29) or 412(n) of the Internal Revenue Code or
pursuant to ERISA with respect to any Pension Plan.

"Eurodollar Rate Loan” means a Loan bearing interest at a rate determined by
reference to the Adjusted Eurodollar Rate.

"Event of Default” means each of the conditions or events set forth in
Section 8.1.

"Exchange Act” means the Securities Exchange Act of 1934, as amended from time
to time, and any successor statute.

"Existing Mortgages” means the Mortgages listed on the attached Schedule 1.1(a).

"Existing Title Policies” means the title policies listed on the attached
Schedule 1.1(b):

"Facility” means any real property (including all buildings, fixtures or other
improvements located thereon but excluding any Hydrocarbon Interests) now,
hereafter or heretofore owned, leased, operated or used by Company or any of its
Subsidiaries or any of their respective Affiliates.

"Fair Share Contribution Amount” has the meaning set forth in Section 7.2.

"Fair Share” has the meaning set forth in Section 7.2.

"Federal Funds Effective Rate” means for any day, the rate per annum (expressed,
as a decimal, rounded upwards, if necessary, to the next higher 1/100 of 1%)
equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published by the Federal Reserve Bank of New York
on the Business Day next succeeding such day; provided, (i) if such day is not a
Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so published on the next
succeeding Business Day, and (ii) if no such rate is so published on such next
succeeding Business Day, the Federal Funds Rate for such day shall be the
average rate charged to Administrative Agent, in its capacity as a Lender, on
such day on such transactions as determined by Administrative Agent.

"Financial Officer” means the chief financial officer, treasurer, assistant
treasurer or controller of Company.

"Financial Officer Certification” means, with respect to the financial
statements for which such certification is required, the certification of a
Financial Officer of Company (in his or her capacity as an officer of Company
and not in his or her individual capacity) that such financial statements fairly
present in accordance with GAAP the financial condition of Company and its
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated, subject to changes resulting from
audit and normal year-end adjustments.

"Financial Plan” has the meaning set forth in Section 5.1(i).

"Fiscal Quarter” means a fiscal quarter of any Fiscal Year.

"Fiscal Year” means the fiscal year of Company and its Subsidiaries ending on
December 31 of each calendar year.

"Flood Hazard Property” means any Real Estate Asset subject to a mortgage in
favor of Collateral Trustee, for the benefit of the Secured Parties, and located
in an area designated by the Federal Emergency Management Agency as having
special flood or mud slide hazards.

"Foreign Subsidiary” means any Subsidiary that is not a Domestic Subsidiary.

"Funding Default” has the meaning set forth in Section 2.22.

"Funding Guarantors” has the meaning set forth in Section 7.2.

"Funding Notice” means a notice substantially in the form of Exhibit A-1.

"GAAP” means, subject to the limitations on the application thereof set forth in
Section 1.2, United States generally accepted accounting principles in effect as
of the date of determination thereof.

"Governmental Acts” means any act or omission, whether rightful or wrongful, of
any Governmental Authority.

"Governmental Authority” means any federal, state, municipal, national or other
government, governmental department, commission, board, bureau, court, agency or
instrumentality or political subdivision thereof or any entity or officer
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to any government or any court, in each case whether
associated with a state of the United States, the United States, or a foreign
entity or government.

"Governmental Authorization” means any permit, license, authorization,
directive, consent order or consent decree of or from any Governmental
Authority.

"Grantor” has the meaning set forth in the Pledge and Security Agreement.

"Guaranteed Obligations” has the meaning set forth in Section 7.1.

"Guarantor” means each Domestic Subsidiary of Company (other Great West
Operating Company, L.C.) as of the Closing Date and each Domestic Subsidiary
that becomes a Guarantor in accordance with Section 5.10.

"Guaranty” means the guaranty of each Guarantor set forth in Section 7.

"Hazardous Materials” means any chemical, material or substance, exposure to
which is prohibited, limited or regulated under any Environmental Law by any
Governmental Authority or which is otherwise defined, listed or regulated as a
pollutant, contaminant, or a hazardous, extremely hazardous or toxic substance,
material or waste under any Environmental Law, a radioactive material, or
Hydrocarbon, petroleum or petroleum waste, petroleum breakdown material or
petroleum product or byproduct.

"Hazardous Materials Activity” means any activity, event or occurrence involving
any Hazardous Materials, including the use, manufacture, possession, storage,
holding, presence, location, Release, threatened Release, discharge, placement,
generation, transportation, processing, treatment, abatement, removal,
remediation, disposal or handling of any Hazardous Materials and any corrective
action or response action with respect to any of the foregoing.

"Hedge Agreement” means an Interest Rate Agreement or a Currency Agreement
entered into with a Lender Counterparty or the Lead Arranger in order to satisfy
the requirements of this Agreement or otherwise in the ordinary course of
Company’s or any of its Restricted Subsidiaries’ businesses but not for
speculative purposes.

"Hedge L/C Commitment” means the commitment of a Lender to acquire
participations in Hedge Letters of Credit, and “Hedge L/C Commitments” means
such commitments of all Lenders in the aggregate. The amount of each Lender’s
Hedge L/C Commitment, if any, is set forth on Appendix A-2 or in the applicable
Assignment Agreement, subject to any adjustment or reduction pursuant to the
terms and conditions hereof. The aggregate amount of the Hedge L/C Commitments
as of the Closing Date is $40,000,000.

"Hedge L/C Commitment Period” means the period from the Closing Date to but
excluding the Hedge L/C Commitment Termination Date.

"Hedge L/C Commitment Termination Date” means the earliest to occur of
(i) August 16, 2010, (ii) the date the Hedge L/C Commitments are permanently
reduced to zero pursuant to Section 2.13(b), and (iii) the date of the
termination of the Hedge L/C Commitments pursuant to Section 8.1.

"Hedge L/C Exposure” means, with respect to any Lender as of any date of
determination, (i) prior to the termination of the Hedge L/C Commitments, that
Lender’s Hedge L/C Commitment; and (ii) after the termination of the Hedge L/C
Commitments, the sum of (a) the aggregate outstanding principal amount of the
Hedge L/C Loans of that Lender, (b) in the case of Issuing Bank, the aggregate
Hedge Letter of Credit Usage in respect of all Hedge Letters of Credit issued by
that Lender (net of any participations by Lenders in such Hedge Letters of
Credit) and (c) the aggregate amount of all participations by that Lender in any
outstanding Hedge Letters of Credit or any unreimbursed drawing under any Hedge
Letter of Credit.

"Hedge L/C Loan” means a Loan made by a Lender to Company pursuant to
Section 2.4(i).

"Hedge L/C Loan Note” means a promissory note in the form of Exhibit B-2.

"Hedge L/C Reimbursement Date” has the meaning set forth in Section 2.4(i).

"Hedge Letter of Credit” means a letter of credit issued or to be issued by
Issuing Bank pursuant to Section 2.4(h) of this Agreement.

"Hedge Letter of Credit Usage” means, as at any date of determination, the sum
of (i) the maximum aggregate amount which is, or at any time thereafter may
become, available for drawing under all Hedge Letters of Credit then
outstanding, and (ii) the aggregate amount of all drawings under Hedge Letters
of Credit honored by Issuing Bank and not theretofore reimbursed by or on behalf
of Company.

"Highest Lawful Rate” means the maximum lawful interest rate, if any, that at
any time or from time to time may be contracted for, charged, or received under
the laws applicable to any Lender which are presently in effect or, to the
extent allowed by law, under such applicable laws which may hereafter be in
effect and which allow a higher maximum nonusurious interest rate than
applicable laws now allow.

"Historical Financial Statements” means as of the Closing Date, (i) the audited
financial statements of Company and its Subsidiaries, as of and for the Year
ended December 31, 2004, consisting of a consolidated balance sheet and the
related consolidated statements of income, stockholders’ equity and cash flows
for such Fiscal Year, and (ii) the unaudited financial statements of Company and
its Subsidiaries for the three-month period ending March 31, 2005, consisting of
a consolidated balance sheet and the related consolidated statements of income,
stockholders’ equity and cash flows for the three-month period ending on such
date, and, in the case of clauses (i) and (ii), certified by the chief financial
officer of Company that they fairly present in accordance with GAAP the
financial condition of Company and its Subsidiaries as at the dates indicated
and the results of their operations and their cash flows for the periods
indicated, subject to changes resulting from audit and normal year-end
adjustments.

"Hydrocarbon Interests” means all rights, titles, interests and estates now
owned or hereafter acquired in and to oil and gas leases, oil, gas and mineral
leases, or other liquid or gaseous hydrocarbon leases, mineral fee or lease
interests, farm-outs, overriding royalty and royalty interests, net profit
interests, oil payments, production payment interests and similar mineral
interests, including any reserved or residual interest of whatever nature.

"Hydrocarbons” means oil, gas, casinghead gas, condensate, distillate, liquid
hydrocarbons, gaseous hydrocarbons, all products refined, separated, settled and
dehydrated therefrom, including, without limitation, kerosene, liquefied
petroleum gas, refined lubricating oils, diesel fuel, drip gasoline, natural
gasoline, helium, sulfur and all other minerals.

"Increased-Cost Lenders” has the meaning set forth in Section 2.23.

"Indebtedness” as applied to any Person means, without duplication, (i) all
indebtedness for borrowed money; (ii) that portion of obligations with respect
to Capital Leases that is properly classified as a liability on a balance sheet
in conformity with GAAP; (iii) notes payable and drafts accepted representing
extensions of credit whether or not representing obligations for borrowed money;
(iv) any obligation owed for all or any part of the deferred purchase price of
property or services (excluding any such obligations incurred under ERISA),
which purchase price is (a) due more than six months from the date of incurrence
of the obligation in respect thereof or (b) evidenced by a note or similar
written instrument; (v) all indebtedness secured by any Lien on any property or
asset owned or held by that Person regardless of whether the indebtedness
secured thereby shall have been assumed by that Person or is nonrecourse to the
credit of that Person (limited, however, to the fair market value of such
property in the event such indebtedness is not assumed); (vi) the face amount of
any letter of credit issued for the account of that Person or as to which that
Person is otherwise liable for reimbursement of drawings; (vii) the direct or
indirect guaranty, endorsement (otherwise than for collection or deposit in the
ordinary course of business), co-making, discounting with recourse or sale with
recourse by such Person of the obligation of another; (viii) any obligation of
such Person the primary purpose or intent of which is to provide assurance to an
obligee that the obligation of the obligor thereof will be paid or discharged,
or any agreement relating thereto will be complied with, or the holders thereof
will be protected (in whole or in part) against loss in respect thereof;
(ix) any liability of such Person for an obligation of another through any
agreement (contingent or otherwise) (a) to purchase, repurchase or otherwise
acquire such obligation or any security therefor, or to provide funds for the
payment or discharge of such obligation (whether in the form of loans, advances,
stock purchases, capital contributions or otherwise) or (b) to maintain the
solvency or any balance sheet item, level of income or financial condition of
another if, in the case of any agreement described under subclauses (a) or
(b) of this clause (ix), the primary purpose or intent thereof is as described
in clause (viii) above; (x) all obligations of such Person in respect of any
exchange traded or over the counter derivative transaction, including, without
limitation, the Swap Agreements and any Interest Rate Agreement and Currency
Agreement, whether entered into for hedging or speculative purposes; provided,
in no event shall obligations under any Interest Rate Agreement, any Currency
Agreement or the Swap Agreements be deemed “Indebtedness” for any purpose under
Section 6.8; and (xi) all Production Payments granted by any Person but solely
to the extent of any warranties or guaranties of production or payment by such
Person with respect to such Production Payment.

"Indemnified Liabilities” means, collectively, any and all liabilities,
obligations, losses, damages (including natural resource damages), penalties,
claims (including Environmental Claims), costs (including the costs of any
investigation, study, sampling, testing, abatement, cleanup, removal,
remediation or other response action necessary to remove, remediate, clean up or
abate any Hazardous Materials Activity), expenses and disbursements of any kind
or nature whatsoever (including the reasonable fees and disbursements of counsel
for Indemnitees in connection with any investigative, administrative or judicial
proceeding commenced or threatened by any Person, whether or not any such
Indemnitee shall be designated as a party or a potential party thereto, and any
fees or expenses incurred by Indemnitees in enforcing this indemnity), whether
direct, indirect or consequential and whether based on any federal, state or
foreign laws, statutes, rules or regulations (including securities and
commercial laws, statutes, rules or regulations and Environmental Laws), on
common law or equitable cause or on contract or otherwise, that may be imposed
on, incurred by, or asserted against any such Indemnitee, in any manner relating
to or arising out of (i) this Agreement or the other Credit Documents or the
transactions contemplated hereby or thereby (including the Lenders’ agreement to
make Credit Extensions or the use or intended use of the proceeds thereof, or
any enforcement of any of the Credit Documents (including any sale of,
collection from, or other realization upon any of the Collateral or the
enforcement of the Guaranty)); (ii) the statements contained in the commitment
letter delivered by any Lender to Company with respect to the transactions
contemplated by this Agreement; or (iii) any Environmental Claim or any
Hazardous Materials Activity relating to or arising from, directly or
indirectly, any past or present activity, operation, land ownership, use or
practice of Company, any of its Subsidiaries or the predecessors of the Company
or any of its Subsidiaries.

"Indemnified Taxes” has the meaning set forth in Section 2.20(a).

"Indemnitee” has the meaning set forth in Section 10.3.

"Independent Engineer” means Wright & Company, Inc., Ryder Scott Company,
DeGolyer and McNaughton, Netherland Sewell & Associates, Cawley, Gillespie and
Associates, Inc., or any other engineering firm acceptable to the Administrative
Agent.

"Independent Engineering Report” means a report, in form and substance
satisfactory to the Administrative Agent, prepared by an Independent Engineer,
addressed to the Administrative Agent and the Lenders with respect to the Oil
and Gas Properties owned by the Company or the Guarantors (or to be acquired by
the Company or any of the Guarantors, as applicable) which are or are to be
included in the Borrowing Base, which report shall (a) specify the location,
quantity, and type of the estimated Proven Reserves attributable to such Oil and
Gas Properties, (b) contain a projection of the rate of production of such Oil
and Gas Properties, (c) contain an estimate of the net operating revenues to be
derived from the production and sale of Hydrocarbons from such Proven Reserves
based on product price and cost escalation assumptions approved by the
Administrative Agent, and (d) contain such other information as is customarily
obtained from and provided in such reports or is otherwise reasonably requested
by the Administrative Agent or any Lender.

"Installment” has the meaning set forth in Section 2.12(a).

"Installment Date” has the meaning set forth in Section 2.12(a).

"Interest Coverage Ratio” means the ratio as of the last day of any Fiscal
Quarter of (i) Consolidated EBITDAX for (a) the one-Fiscal Quarter ending on
September 30, 2005, (b) the two-Fiscal Quarter period ending December 31, 2005,
(c) the three-Fiscal Quarter period ending March 31, 2006, and (d) each
four-Fiscal Quarter period ending thereafter to (ii) Consolidated Cash Interest
Expense for such period.

"Interest Payment Date” means with respect to (i) any Revolving Loan or Hedge
L/C Loan that is a Base Rate Loan, each March 31, June 30, September 30 and
December 31 of each year, commencing on the first such date to occur after the
Closing Date and the final maturity date of such Loan and (ii) any Revolving
Loan or Hedge L/C Loan that is a Eurodollar Rate Loan, the last day of each
Interest Period applicable to such Loan; provided, in the case of each Interest
Period of longer than three months “Interest Payment Date” shall also include
each date that is three months, or an integral multiple thereof, after the
commencement of such Interest Period.

"Interest Period” means, in connection with a Eurodollar Rate Loan, an interest
period of one, two, three or six months, as selected by Company in the
applicable Funding Notice or Conversion/Continuation Notice, (i) initially,
commencing on the Credit Date or Conversion/Continuation Date thereof, as the
case may be and (ii) thereafter, commencing on the day on which the immediately
preceding Interest Period expires; provided, (a) if an Interest Period would
otherwise expire on a day that is not a Business Day, such Interest Period shall
expire on the next succeeding Business Day unless no further Business Day occurs
in such month, in which case such Interest Period shall expire on the
immediately 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, subject to clauses (c) and (d), of this definition, end on the
last Business Day of a calendar month; and (c) no Interest Period with respect
to any portion of the Revolving Loans shall extend beyond the Revolving
Commitment Termination Date.

"Interest Rate Agreement” means any interest rate swap agreement, interest rate
cap agreement, interest rate collar agreement, interest rate hedging agreement
or other similar agreement or arrangement, each of which is for the purpose of
hedging the interest rate exposure associated with Company’s and its Restricted
Subsidiaries’ operations and not for speculative purposes.

"Interest Rate Determination Date” means, with respect to any Interest Period,
the date that is two Business Days prior to the first day of such Interest
Period.

"Internal Engineering Report” means a report, in form and substance satisfactory
to the Administrative Agent, prepared by the Company and certified by an
Authorized Officer of the Company, addressed to the Administrative Agent and the
Lenders with respect to the Oil and Gas Properties owned by the Company or any
of the Guarantors (or to be acquired by the Company or any of the Guarantors, as
applicable) which are or are to be included in the Borrowing Base, which report
shall (a) specify the location, quantity, and type of the estimated Proven
Reserves attributable to such Oil and Gas Properties, (b) contain a projection
of the rate of production of such Oil and Gas Properties, (c) contain an
estimate of the net operating revenues to be derived from the production and
sale of Hydrocarbons from such Proven Reserves based on product price and cost
escalation assumptions approved by the Administrative Agent, and (d) contain
such other information as is customarily obtained from and provided in such
reports or is otherwise reasonably requested by the Administrative Agent or any
Lender.

"Internal Revenue Code” means the Internal Revenue Code of 1986, as amended to
the date hereof and from time to time hereafter, and any successor statute.

"Investment” means (i) any direct or indirect purchase or other acquisition by
Company or any of its Restricted Subsidiaries of, or of a beneficial interest
in, any of the Securities of any other Person (other than a Guarantor); (ii) any
direct or indirect redemption, retirement, purchase or other acquisition for
value, by any Subsidiary of Company from any Person (other than Company or any
Guarantor), of any Capital Stock of such Person; and (iii) any direct or
indirect loan, advance (other than advances to employees for moving,
entertainment and travel expenses, drawing accounts and similar expenditures in
the ordinary course of business) or capital contribution by Company or any of
its Subsidiaries to any other Person (other than Company or any Guarantor),
including all indebtedness and accounts receivable from that other Person that
are not current assets or did not arise from sales to that other Person in the
ordinary course of business. The amount of any Investment shall be the original
cost of such Investment plus the cost of all additions thereto, without any
adjustments for increases or decreases in value, or write-ups, write-downs or
write-offs with respect to such Investment.

"Issuance Notice” means an Issuance Notice substantially in the form of
Exhibit A-3.

"Issuing Bank” means (i) BNPP or a bank or other legally authorized Person
meeting the Letter of Credit Issuer Rating selected by or acceptable to
Administrative Agent in such Person’s capacity as an issuer of a Letter of
Credit or Hedge Letter of Credit; and (ii) any Replacement Issuing Bank.

"J. Aron Swap” means the ISDA Master Agreement dated as of June 30, 2004 by and
between J. Aron & Company and the Company (including the Schedule thereto and
the confirmations thereunder) pursuant to which the parties thereto have entered
into certain gas and oil commodity derivatives transactions, and all “Credit
Support Documents” described therein and any other documents or agreements
entered into in connection therewith.

"Joint Venture” means a joint venture, partnership or other similar arrangement,
whether in corporate, partnership or other legal form; provided, in no event
shall any corporate Restricted Subsidiary of any Person be considered to be a
Joint Venture to which such Person is a party.

"Landlord Consent and Estoppel” means, with respect to any Leasehold Property, a
letter, certificate or other instrument in writing from the lessor under the
related lease, pursuant to which, among other things, the landlord consents to
the granting of a Mortgage on such Leasehold Property by the Credit Party
tenant, such Landlord Consent and Estoppel to be in form and substance
acceptable to Administrative Agent in its reasonable discretion, but in any
event sufficient for Collateral Trustee to obtain a Title Policy with respect to
such Mortgage.

"Landlord Personal Property Collateral Access Agreement” means a Landlord Waiver
and Consent Agreement substantially in the form of Exhibit L with such
amendments or modifications as may be approved by Administrative Agent.

"Lead Arranger” has the meaning set forth in the preamble hereto.

"Leasehold Property” means any leasehold interest of any Credit Party as lessee
under any lease of real property, other than any such leasehold interest
designated from time to time by Administrative Agent in its sole discretion as
not being required to be included in the Collateral; provided that Leasehold
Property shall exclude Hydrocarbon Interests.

"Leases” means all oil and gas leases, oil, gas and mineral leases, oil, gas and
casinghead gas leases or any other instruments, agreements, or conveyances under
and pursuant to which the owner thereof has or obtains the right to enter upon
lands and explore for, drill, and develop such lands for the production of
Hydrocarbons.

"Lender” means each financial institution listed on the signature pages hereto
as a Lender, and any other Person that becomes a party hereto pursuant to an
Assignment Agreement.

"Lender Counterparty” means each Lender or any Affiliate of a Lender
counterparty to a Hedge Agreement (including any person who was a Lender or an
Affiliate of a Lender at the time such Hedge Agreement was entered into but
subsequently ceases to be a Lender or an Affiliate of a Lender) including,
without limitation, each such Affiliate that enters into a joinder agreement
with the Collateral Trustee.

"Letter of Credit” means a commercial or standby letter of credit (other than a
Hedge Letter of Credit) issued or to be issued by an Issuing Bank pursuant to
this Agreement.

"Letter of Credit Commitment Period” means the period from the Closing Date to
but excluding the Revolving Commitment Termination Date.

"Letter of Credit Issuer Rating” has the meaning provided that term as of the
Closing Date in the ISDA Master Agreement (and related Schedules) referred to in
the definition of J. Aron Swap.

"Letter of Credit Sublimit” means the lesser of (i) $20,000,000 and (ii) the
aggregate unused amount of the Revolving Commitments then in effect.

"Letter of Credit Usage” means, as at any date of determination, the sum of
(i) the maximum aggregate amount which is, or at any time thereafter may become,
available for drawing under all Letters of Credit then outstanding and (ii) the
aggregate amount of all drawings under Letters of Credit honored by Issuing Bank
and not theretofore reimbursed by or on behalf of Company.

"Leverage Ratio” means the ratio as of the last day of any Fiscal Quarter or
other date of determination of (i) Consolidated Total Debt as of such day to
(ii) Consolidated EBITDAX for the four-Fiscal Quarter period ending on such date
(or if such date of determination is not the last day of a Fiscal Quarter, for
the four-Fiscal Quarter period ending as of the most recently concluded Fiscal
Quarter for which financial statements have been required to be delivered under
this Agreement).

"Lien” means (i) any lien, mortgage, pledge, assignment, security interest,
charge or encumbrance of any kind (including any agreement to give any of the
foregoing, any conditional sale or other title retention agreement, and any
lease in the nature thereof) and any option, trust or other preferential
arrangement having the practical effect of any of the foregoing and (ii) in the
case of Securities, any purchase option, call or similar right of a third party
with respect to such Securities.

"Loan” means a Revolving Loan and a Hedge L/C Loan.

"Margin Stock” has the meaning set forth in Regulation U of the Board of
Governors of the Federal Reserve System as in effect from time to time.

"Material Adverse Effect” means a material adverse effect on and/or material
adverse developments with respect to (i) the business operations, properties,
assets, condition (financial or otherwise) or prospects of Company and its
Subsidiaries taken as a whole; (ii) the ability of the Credit Parties, taken as
a whole, to fully and timely perform the Obligations; (iii) the legality,
validity, binding effect or enforceability against a Credit Party of a Credit
Document to which it is a party; or (v) the rights, remedies and benefits
available to, or conferred upon, any Agent and any Lender or any Secured Party
under any Credit Document.

"Material Contract” means any contract or other arrangement to which Company or
any of its Restricted Subsidiaries is a party (other than the Credit Documents)
for which breach, nonperformance, cancellation or failure to renew could
reasonably be expected to have a Material Adverse Effect, including, without
limitation, the J. Aron Swap.

"Material Real Estate Asset’’ means (i)(a) any fee-owned Real Estate Asset
having a fair market value in excess of $2,500,000 as of the date of the
acquisition thereof and (b) all Leasehold Properties other than those with
respect to which the aggregate payments under the term of the lease are less
than $250,000 per annum or (ii) any Real Estate Asset that the Requisite Lenders
have determined is material to the business, operations, properties, assets,
condition (financial or otherwise) or prospects of Company or any Restricted
Subsidiary thereof, including Company.

"Material Subsidiary” means any Restricted Subsidiary of the Company to which,
on any date of its determination either (i) $2,000,000 or more of Consolidated
EBITDAX during the four-Fiscal Quarter period most recently ended was
attributable to such Restricted Subsidiary or (ii) assets with a book value of
$10,000,000 or more is attributable.

"Maximum Delivery Amount” shall mean, as of any date, the maximum amount that
could be required to be delivered on such date as specified in paragraph
13(b)(i)(A) of the Amended and Restated Credit Support Annex dated as of
August 16, 2005, and as in effect on the Closing Date and entered into in
connection with the J. Aron Swap.

"Moody’s” means Moody’s Investor Services, Inc.

"Mortgage” means a Mortgage substantially in the form of Exhibit K.

"Mortgage Supplement” means Supplements to the Existing Mortgages, substantially
in the form of the attached Exhibit D.

"Multiemployer Plan” means any Employee Benefit Plan which is a “multiemployer
plan” as defined in Section 3(37) of ERISA.

"NAIC” means The National Association of Insurance Commissioners, and any
successor thereto.

"Narrative Report” means, with respect to the financial statements for which
such narrative report is required, a narrative report describing the operations
of Company and its Subsidiaries in the form prepared for presentation to senior
management thereof for the applicable Fiscal Year.

"Net Insurance/Condemnation Proceeds” means an amount equal to: (i) any Cash
payments or proceeds received by Company or any of its Restricted Subsidiaries
(a) under any casualty insurance policy in respect of a covered loss thereunder
or (b) as a result of the taking of any assets of Company or any of its
Restricted Subsidiaries by any Person pursuant to the power of eminent domain,
condemnation or otherwise, or pursuant to a sale of any such assets to a
purchaser with such power under threat of such a taking, minus (ii) (a) any
actual and reasonable costs incurred by Company or any of its Restricted
Subsidiaries in connection with the adjustment or settlement of any claims of
Company or such Restricted Subsidiary in respect thereof, and (b) any bona fide
direct costs incurred in connection with any sale of such assets as referred to
in clause (i)(b) of this definition, including income taxes payable as a result
of any gain recognized in connection therewith.

"Non-Recourse Debt” means Indebtedness:

(i) as to which neither the Company nor any of its Restricted Subsidiaries
(A) provides credit support of any kind (including any undertaking, agreement or
instrument that would constitute Indebtedness), other than a pledge of the stock
or other ownership interests of an Unrestricted Subsidiary, or (B) is directly
or indirectly liable as a guarantor or otherwise, or (C) constitutes the lender;

(ii) no default with respect to which (including any rights that the holders of
the Indebtedness may have to take enforcement action against an Unrestricted
Subsidiary) would permit upon notice, lapse of time or both any holder of any
other Indebtedness of the Company or any of its Restricted Subsidiaries to
declare a default on such other Indebtedness or cause the payment of such other
Indebtedness to be accelerated or payable prior to its stated maturity; and

(iii) as to which the lenders of such Indebtedness have been notified in writing
that they will not have any recourse to the stock or assets of the Company or
any of its Restricted Subsidiaries, except as permitted in clause (i)(A) above.

"Non-US Lender” has the meaning set forth in Section 2.20(c).

"Note” means a Revolving Loan Note or a Hedge L/C Loan Note.

"Notice” means a Funding Notice, an Issuance Notice, or a
Conversion/Continuation Notice.

"Obligations” means all obligations of every nature of each Credit Party from
time to time owed to the Agents (including former Agents), the Collateral
Trustee, the Lenders or any of them, each Issuing Bank and Lender
Counterparties, under any Credit Document or Hedge Agreement (including, without
limitation, with respect to a Hedge Agreement, obligations owed thereunder to
any person who was a Lender or an Affiliate of a Lender at the time such Hedge
Agreement was entered into), whether for principal, interest (including interest
which, but for the filing of a petition in bankruptcy with respect to such
Credit Party, would have accrued on any Obligation, whether or not a claim is
allowed against such Credit Party for such interest in the related bankruptcy
proceeding), reimbursement of amounts drawn under Letters of Credit or Hedge
Letters of Credit, payments for early termination of Hedge Agreements, and all
other fees, expenses, indemnification obligations and other amounts or
obligations.

"Obligee Guarantor” has the meaning set forth in Section 7.7.

"Oil And Gas Business” means (a) the acquisition, exploration, exploitation,
development, operation and disposition of interests in oil and gas properties
and Hydrocarbons, (b) the gathering, marketing, treating, processing, storage,
selling and transporting of any production from such interests or properties,
including, without limitation, the marketing of Hydrocarbons obtained from
unrelated Persons; (c) any business relating to or arising from exploration for
or development, production, treatment, processing, storage, transportation or
marketing of oil, gas and other minerals and products produced in association
therewith; (d) any business relating to oilfield sales and service; and (e) any
activity that is ancillary or necessary or desirable to facilitate the
activities described in clauses (a) through (d) of this definition, excluding,
for the avoidance of doubt, refining of hydrocarbons.

"Oil and Gas Properties” means Hydrocarbon Interests; the Properties now or
hereafter pooled or unitized with Hydrocarbon Interests; all presently existing
or future unitization, pooling agreements and declarations of pooled units and
the units created thereby (including without limitation all units created under
orders, regulations and rules of any Governmental Authority having jurisdiction)
which may affect all or any portion of the Hydrocarbon Interests; all pipelines,
gathering lines, compression facilities, tanks and processing plants; all
interests held in royalty trusts whether presently existing or hereafter
created; all Hydrocarbons in and under and which may be produced, saved,
processed or attributable to the Hydrocarbon Interests, the lands covered
thereby and all hydrocarbons in pipelines, gathering lines, tanks and processing
plants and all rents, issues, profits, proceeds, products, revenues and other
incomes from or attributable to the Hydrocarbon Interests; all tenements,
hereditaments, appurtenances and Properties in any way appertaining, belonging,
affixed or incidental to the Hydrocarbon Interests, and all rights, titles,
interests and estates described or referred to above, including any and all real
property, now owned or hereafter acquired, used or held for use in connection
with the operating, working or development of any of such Hydrocarbon Interests
or Property and including any and all surface leases, rights-of-way, easements
and servitude together with all additions, substitutions, replacements,
accessions and attachments to any and all of the foregoing; all oil, gas and
mineral leasehold and fee interests, all overriding royalty interests, mineral
interests, royalty interests, net profits interests, net revenue interests, oil
payments, production payments, carried interests and any and all other interests
in Hydrocarbons. For the avoidance of doubt, this definition applies to Oil and
Gas Properties and Hydrocarbon Interests now owned or hereafter acquired
directly or indirectly by the Company or the Guarantors.

"Organizational Documents” means (i) with respect to any corporation, its
certificate or articles of incorporation or organization and its by-laws,
(ii) with respect to any limited partnership, its certificate of limited
partnership, as amended, and its partnership agreement, (iii) with respect to
any general partnership, its partnership agreement, and (iv) with respect to any
limited liability company, its articles of organization and its operating
agreement. In the event any term or condition of this Agreement or any other
Credit Document requires any Organizational Document to be certified by a
secretary of state or similar governmental official, the reference to any such
“Organizational Document” shall only be to a document of a type customarily
certified by such governmental official.

"Owner Pledge Agreement” means the First Priority Lien Pledge Agreement between
Capital C Energy Operations, LP and the Collateral Trustee in substantially the
form of Exhibit J.

"PBGC” means the Pension Benefit Guaranty Corporation or any successor thereto.

"Pension Plan” means any Employee Benefit Plan, other than a Multiemployer Plan,
which is subject to Section 412 of the Internal Revenue Code or Section 302 of
ERISA.

"Permitted Acquisition” means any acquisition by Company or any of its
wholly-owned Restricted Subsidiaries, whether by purchase, merger or otherwise,
of all or substantially all of the assets of, all of the Capital Stock of, or a
business line or unit or a division of, any Person or any Hydrocarbon Interest
of any Person; provided, except with respect to Permitted Acquisitions of
Hydrocarbon Interests having a value of less than $5,000,000,

(i) immediately prior to, and after giving effect thereto, no Default or Event
of Default shall have occurred and be continuing or would result therefrom;

(ii) all transactions in connection therewith shall be consummated, in all
material respects, in accordance with all applicable laws and in conformity with
all applicable Governmental Authorizations;

(iii) in the case of the acquisition of Capital Stock, the Requisite Lenders
shall have consented to such acquisition and all of the Capital Stock (except
for any such Securities in the nature of directors’ qualifying shares required
pursuant to applicable law) acquired or otherwise issued by such Person or any
newly formed Restricted Subsidiary of Company in connection with such
acquisition shall be owned 100% by Company or a Guarantor thereof, and Company
shall have taken, or caused to be taken, as of the date such Person becomes a
Restricted Subsidiary of Company, each of the actions set forth in Sections 5.10
and/or 5.11, as applicable;

(iv) Company shall be in compliance with the financial covenants set forth in
Section 6.8 on a pro forma basis after giving effect to such acquisition as of
the last day of the Fiscal Quarter most recently ended, (as determined in
accordance with Section 6.8(h); and

(v) Company shall have delivered to Administrative Agent (A) at least five
Business Days prior to such proposed acquisition, a Compliance Certificate
evidencing compliance with Section 6.8 as required under clause (iv) above,
together with all relevant financial information with respect to such acquired
assets, including, without limitation, the aggregate consideration for such
acquisition and any other information required to demonstrate compliance with
Section 6.8.

"Permitted Business Investments” means investments made in the ordinary course
of, and of a nature that is or shall have become customary in, the Oil and Gas
Business as a means of actively exploiting, exploring for, acquiring,
developing, processing, gathering, marketing or transporting oil and gas through
agreements, transactions, interests or arrangements which permit one to share
risks of costs, comply with regulatory requirements regarding local ownership or
satisfy other objectives customarily achieved through the conduct of Oil and Gas
Business jointly or with third parties, including, without limitation, the entry
into operating agreements, working interests, royalty interests, mineral leases,
processing agreements, farm-out and farm-in agreements, division orders,
contracts for the sale, transportation or exchange of oil or natural gas,
unitization and pooling declarations and agreements and area of mutual interest
agreements, production sharing agreements or other similar or customary
agreements, transactions, properties, interests, and investments and
expenditures in connection therewith, and also including investments in capital
stock, partnership interests, joint venture interests, limited liability company
interests or other similar equity interests in a Person, provided that an
investment in any such equity interest shall not be permitted at any time that
an Event of Default shall be in effect, nor shall any such investment be
permitted if the portion of the liabilities of such partnership, joint venture
or limited liability company for which the Company shall become liable would
have a Material Adverse Effect on the Company; and further provided that,
Volumetric Production Payments shall not constitute a Permitted Business
Investment, except for those certain Volumetric Production Payments to be made
under the terms of that certain Agreement of Limited Partnership of Blue Spruce
Investments Limited partnership dated as of September 1, 1993.

"Permitted Encumbrances” has the meaning specified in the Mortgages.

"Permitted Liens” means each of the Liens permitted pursuant to Section 6.2.

"Permitted Prior Liens” means the Liens permitted under paragraphs (b), (c),
(d), (f), (g), (i), (m), (n), (o), (q), (r), (s), and (t) of Section 6.2.

"Person” means and includes natural persons, corporations, limited partnerships,
general partnerships, limited liability companies, limited liability
partnerships, joint stock companies, Joint Ventures, associations, companies,
trusts, banks, trust companies, land trusts, business trusts or other
organizations, whether or not legal entities, and Governmental Authorities.

"Pledge and Security Agreement” means the Priority Lien Pledge and Security
Agreement to be executed by Company and each Guarantor substantially in the form
of Exhibit I.

"Prime Rate” means the rate of interest publicly announced by BNPP in New York,
New York from time to time as its base rate (the base rate not being intended to
be the lowest rate of interest charged by BNPP in connection with extensions of
credit to debtors. Agent or any other Lender may make commercial loans or other
loans at rates of interest at, above or below the Prime Rate.

"Principal Office” means, for each of Administrative Agent and Issuing Bank,
such Person’s “Principal Office” as set forth on Appendix B, or such other
office or office of a third party or sub-agent, as appropriate, as such Person
may from time to time designate in writing to Company, Administrative Agent and
each Lender.

"Pro Rata Share” means (i) with respect to all payments, computations and other
matters relating to the Revolving Commitment or Revolving Loans of any Lender or
any Letters of Credit issued or participations purchased therein by any Lender,
the percentage obtained by dividing (a) the Revolving Exposure of that Lender by
(b) the aggregate Revolving Exposure of all Lenders; and (ii) with respect to
all payments, computations and other matters relating to the Hedge L/C
Commitment or Hedge L/C Loans of any Lender or any Hedge Letters of Credit
issued or participations purchased therein by any Lender, the percentage
obtained by dividing (a) the Hedge L/C Exposure of that Lender by (b) the
aggregate Hedge L/C Exposure of all Lenders. For all other purposes with respect
to each Lender, “Pro Rata Share” means the percentage obtained by dividing
(A) an amount equal to the sum of the Revolving Exposure and the Hedge L/C
Exposure of that Lender, by (B) an amount equal to the sum of aggregate
Revolving Exposure and the aggregate Hedge L/C Exposure of all Lenders.

"Production Payments” means, collectively, Dollar-Denominated Production
Payments and Volumetric Production Payments.

"Properties” means any kind of facility, fixture, property or asset, whether
real, personal or mixed, or tangible or intangible owned, leased or operated by
the Company or any Subsidiary.

"Proved Developed Producing Reserves” means those Oil and Gas Properties
designated as “proved developed producing” (applying the reporting standards
prescribed by the Society of Petroleum Engineers) in the Engineering Report.

"Proven Reserves” means, at any particular time, the estimated quantities of
Hydrocarbons which geological and engineering data demonstrate with reasonable
certainty to be recoverable in future years from known reservoirs attributable
to Oil and Gas Properties included or to be included in the Borrowing Base under
then existing economic and operating conditions.

"Qualified Junior Debt” means unsecured Indebtedness of the Company payable to
its equity holders subordinated to the Obligations in a manner satisfactory to
the Administrative Agent in its reasonable discretion and that only requires
cash interest to be paid to the extent permitted under this Agreement.

"Real Estate Asset” means, at any time of determination, any interest (fee,
leasehold or otherwise) then owned by any Credit Party in any real property,
other than Hydrocarbon Interests.

"Record Document” means, with respect to any Leasehold Property, (i) the lease
evidencing such Leasehold Property or a memorandum thereof, executed and
acknowledged by the owner of the affected real property, as lessor, or (ii) if
such Leasehold Property was acquired or subleased from the holder of a Recorded
Leasehold Interest, the applicable assignment or sublease document, executed and
acknowledged by such holder, in each case in form sufficient to give such
constructive notice upon recordation and otherwise in form reasonably
satisfactory to Administrative Agent.

"Recorded Leasehold Interest” means a Leasehold Property with respect to which a
Record Document has been recorded in all places necessary or desirable, in
Administrative Agent’s reasonable judgment, to give constructive notice of such
Leasehold Property to third-party purchasers and encumbrancers of the affected
real property.

"Register” has the meaning set forth in Section 2.7(b).

"Regulation D” means Regulation D of the Board of Governors of the Federal
Reserve System, as in effect from time to time.

"Reimbursement Date” has the meaning set forth in Section 2.4(d).

"Related Agreements” means, collectively, the Acquisition Agreement, the Senior
Secured Debt Documents, and the Swap Agreements.

"Related Fund” means, with respect to any Lender that is an investment fund, any
other investment fund that invests in commercial loans and that is managed or
advised by the same investment advisor as such Lender or by an Affiliate of such
investment advisor.

"Release” means any release, spill, emission, leaking, pumping, pouring,
injection, escaping, deposit, disposal, discharge, dispersal, dumping, leaching
or migration of any Hazardous Material into the indoor or outdoor environment
(including the abandonment or disposal of any barrels, containers or other
closed receptacles containing any Hazardous Material), including the movement of
any Hazardous Material through the air, soil, surface water or groundwater.

"Replacement Issuing Bank” has the meaning set forth in Section 2.4(j).

"Replacement Lender” has the meaning set forth in Section 2.23.

"Requisite Class Lenders” means, at any time of determination, (i) for the Class
of Lenders having Revolving Exposure, Lenders holding more than 66.67% of the
aggregate Revolving Exposure of all Lenders and (ii) for each Class of Lenders
having Hedge L/C Exposure, Lenders holding more than 66.67% of the aggregate
Hedge L/C Exposure of that Class.

"Requisite Lenders” means one or more Lenders having or holding Hedge L/C
Exposure and/or Revolving Exposure and representing more than 66.67% of the sum
of (i) the aggregate Revolving Exposure of all Lenders and (ii) the aggregate
Hedge L/C Exposure of all Lenders.

"Requisite Revolving Lenders” means one or more Revolving Lenders having or
holding Revolving Exposure and representing more than 66.67% of the Revolving
Exposure of all Lenders.

"Restricted Junior Payment” means (i) any dividend or other distribution, direct
or indirect, on account of any shares of any class of stock of Company now or
hereafter outstanding, except a dividend payable solely in shares of that class
of stock to the holders of that class; (ii) any redemption, retirement, sinking
fund or similar payment, purchase or other acquisition for value, direct or
indirect, of any shares of any class of stock of Company now or hereafter
outstanding; (iii) any payment made to retire, or to obtain the surrender of,
any outstanding warrants, options or other rights to acquire shares of any class
of stock of Company now or hereafter outstanding; and (iv) any payment or
prepayment of principal of, premium, if any, or interest on, or redemption,
purchase, retirement, defeasance (including in-substance or legal defeasance),
sinking fund or similar payment with respect to, any subordinated Indebtedness,
including any Qualified Junior Debt, except for interest payable solely as
Qualified Junior Debt.

"Restricted Subsidiary” of a Person means any Subsidiary of the referent Person
that is not an Unrestricted Subsidiary.

"Revolving Commitment” means the commitment of a Lender to make or otherwise
fund any Revolving Loan and to acquire participations in Letters of Credit
hereunder and “Revolving Commitments” means such commitments of all Lenders in
the aggregate. The amount of each Lender’s Revolving Commitment, if any, is set
forth on Appendix A-3 or in the applicable Assignment Agreement, subject to any
adjustment or reduction pursuant to the terms and conditions hereof. The
aggregate amount of the Revolving Commitments as of the Closing Date is
$350,000,000.

"Revolving Commitment Period” means the period from the Closing Date to but
excluding the Revolving Commitment Termination Date.

"Revolving Commitment Termination Date” means the earliest to occur of
(i) August 16, 2010, (ii) the date the Revolving Commitments are permanently
reduced to zero pursuant to Section 2.13(b), and (iii) the date of the
termination of the Revolving Commitments pursuant to Section 8.1.

"Revolving Exposure” means, with respect to any Lender as of any date of
determination, (i) prior to the termination of the Revolving Commitments, that
Lender’s Revolving Commitment; and (ii) after the termination of the Revolving
Commitments, the sum of (a) the aggregate outstanding principal amount of the
Revolving Loans of that Lender, (b) in the case of Issuing Bank, the aggregate
Letter of Credit Usage in respect of all Letters of Credit issued by that Lender
(net of any participations by Lenders in such Letters of Credit) and (c) the
aggregate amount of all participations by that Lender in any outstanding Letters
of Credit or any unreimbursed drawing under any Letter of Credit.

"Revolving Lender” means a Lender with Revolving Exposure.

"Revolving Loan” means a Loan made by a Lender to Company pursuant to
Section 2.2(a) and/or 2.22.

"Revolving Loan Note” means a promissory note in the form of Exhibit B-1.

"S&P” means Standard & Poor’s Ratings Group, a division of The McGraw Hill
Corporation.

"SEC” means the Securities and Exchange Commission.

"SEC Value” means the future net revenues before income taxes from Proven
Reserves, estimated utilizing the price for the appropriate category of oil or
gas as of the date of determination and assuming that oil and natural gas prices
and production costs thereafter remain constant, then discounted at the rate of
10% per year to obtain the present value, and otherwise applying the financial
accounting and reporting standards prescribed by the SEC for application of the
successful efforts method of accounting under Rule 4-10 of Regulation S-X as
promulgated by the SEC from time to time.

"Section 29 Properties” has the meaning set forth in subsection 6.9(h).

"Secured Parties” has the meaning assigned to that term in the Pledge and
Security Agreement.

"Securities” means any stock, shares, partnership interests, voting trust
certificates, certificates of interest or participation in any profit-sharing
agreement or arrangement, options, warrants, bonds, debentures, notes, or other
evidences of indebtedness, secured or unsecured, convertible, subordinated or
otherwise, or in general any instruments commonly known as “securities” or any
certificates of interest, shares or participations in temporary or interim
certificates for the purchase or acquisition of, or any right to subscribe to,
purchase or acquire, any of the foregoing.

"Securities Act” means the Securities Act of 1933, as amended from time to time,
and any successor statute.

"Senior Debt” means, as at any date of determination, the aggregate principal
amount of Loans outstanding as of such date.

"Senior Secured Debt Documents” means the Senior Secured Note Indenture, the
Senior Secured Notes and each other document executed in connection with the
Senior Secured Notes, and any documents executed in connection with any
refinancings or replacements thereof to the extent permitted under Section 6.16.

"Senior Secured Indebtedness” means the obligations of Company pursuant to the
Senior Secured Debt Documents.

"Senior Secured Note Indenture” means the indenture dated July 7, 2004, pursuant
to which the Senior Secured Notes are issued, and any indenture pursuant to
which the Senior Secured Notes are refinanced or replaced pursuant to a
transaction permitted under Section 6.1.

"Senior Secured Notes” means the Senior Secured Notes of Company in the
aggregate principal amount of not less than $192,500,000 and issued pursuant to
the Senior Secured Note Indenture, and any subordinated promissory notes issued
in respect of any refinancing or replacement of such Senior Secured Notes in a
transaction permitted under Section 6.1.

"Settlement Confirmation” has the meaning set forth in Section 10.6(b).

"Settlement Service” has the meaning set forth in Section 10.6(d).

"Solvency Certificate” means a Solvency Certificate of the chief financial
officer of Company substantially in the form of Exhibit G-2.

"Solvent” means, with respect to any Credit Party, that as of the date of
determination, both (i) (a) the sum of such Credit Party’s debt (including
contingent liabilities) does not exceed the present fair saleable value of such
Credit Party’s present assets; (b) such Credit Party’s capital is not
unreasonably small in relation to its business as contemplated on the Closing
Date or with respect to any transaction contemplated or undertaken after the
Closing Date; and (c) such Person has not incurred and does not intend to incur,
or believe (nor should it reasonably believe) that it will incur, debts beyond
its ability to pay such debts as they become due (whether at maturity or
otherwise); and (ii) such Person is “solvent” within the meaning given that term
and similar terms under applicable laws relating to fraudulent transfers and
conveyances. For purposes of this definition, the amount of any contingent
liability at any time shall be computed as the amount that, in light of all of
the facts and circumstances existing at such time, represents the amount that
can reasonably be expected to become an actual or matured liability
(irrespective of whether such contingent liabilities meet the criteria for
accrual under Statement of Financial Accounting Standard No. 5).

"Subject Transaction” has the meaning set forth in Section 6.8(h).

"Subsidiary” means, with respect to any Person, any corporation, partnership,
limited liability company, association, joint venture or other business entity
of which more than 50% of the total voting power of shares of stock or other
ownership interests entitled (without regard to the occurrence of any
contingency) to vote in the election of the Person or Persons (whether
directors, managers, trustees or other Persons performing similar functions)
having the power to direct or cause the direction of the management and policies
thereof is at the time owned or controlled, directly or indirectly, by that
Person or one or more of the other Subsidiaries of that Person or a combination
thereof; provided, in determining the percentage of ownership interests of any
Person controlled by another Person, no ownership interest in the nature of a
“qualifying share” of the former Person shall be deemed to be outstanding.

"Swap Agreements” means (i) the J. Aron Swap, and (ii) any ISDA Master
Agreement, other master agreement, long form confirmation, or other agreement
entered into after the Closing Date by the Company and/or its Restricted
Subsidiaries (including the Schedule thereto and the confirmations thereunder),
pursuant to which the parties thereto enter into certain gas and oil commodity
derivatives transactions.

"Swap Agreement Documents” means the Swap Agreements and each other document
executed in connection with the Swap Agreements, and any documents executed in
connection with any refinancings or replacements thereof to the extent permitted
under Section 6.15.

"Syndication Agent” means BNPP.

"Tax” means any present or future tax, levy, impost, duty, assessment, charge,
fee, deduction or withholding of any nature and whatever called, by whomsoever,
on whomsoever and wherever imposed, levied, collected, withheld or assessed;
provided, “Tax on the overall net income” of a Person shall be construed as a
reference to a tax imposed by the jurisdiction in which that Person is organized
or in which that Person’s applicable principal office (and/or, in the case of a
Lender, its lending office) is located or in which that Person (and/or, in the
case of a Lender, its lending office) is deemed to be doing business on all or
part of the net income, profits or gains (whether worldwide, or only insofar as
such income, profits or gains are considered to arise in or to relate to a
particular jurisdiction, or otherwise) of that Person (and/or, in the case of a
Lender, its applicable lending office).

"Tender Offer” means the Company’s offer to purchase for cash all outstanding
Senior Secured Notes pursuant to the terms and conditions of that certain Offer
to Purchase and Consent Solicitation Statement dated July 18, 2005.

"Terminated Lender” has the meaning set forth in Section 2.23.

"Title Company” means a title insurance company of recognized national standing
which is acceptable to the Administrative Agent in its reasonable discretion.

"Title Policy” shall mean, with respect to any Mortgage, a mortgagee policy of
title insurance (ALTA or the equivalent) or marked “commitment” of title
insurance insuring the applicable Mortgage as a first priority Lien on such real
property asset in favor of the Collateral Trustee (for the benefit of the
holders of the Obligations, including the Secured Parties) to secure the
Obligations, free of all Liens other than the Permitted Encumbrances, which
policy of title insurance shall be issued by a Title Company in such policy
amounts, with such endorsements and affirmative insurance, and in form and
substance reasonably satisfactory to the Administrative Agent, and shall contain
no exceptions to coverage other than matters satisfactory to the Administrative
Agent in its judgment reasonably exercised and which policy of title insurance
shall have been fully paid for by the Company.

"Total Utilization of Revolving Commitments” means, as at any date of
determination, the sum of (i) the aggregate principal amount of all outstanding
Revolving Loans (other than Revolving Loans made for the purpose of reimbursing
Issuing Bank for any amount drawn under any Letter of Credit, but not yet so
applied) and (ii) the Letter of Credit Usage.

"Total Utilization of Hedge L/C Commitments” means, as at any date of
determination, the sum of (i) the aggregate principal amount of all outstanding
Hedge L/C Loans (other than Hedge L/C Loans made for the purpose of reimbursing
Issuing Bank for any amount drawn under any Letter of Credit, but not yet so
applied) and (ii) the Hedge Letter of Credit Usage.

"Transaction Costs” means the fees, costs and expenses payable by Company or any
of Company’s Restricted Subsidiaries on or before the Closing Date in connection
with the transactions contemplated by the Credit Documents and the Related
Agreements.

"Type of Loan” means a Base Rate Loan or a Eurodollar Rate Loan.

"UCC” means the Uniform Commercial Code (or any similar or equivalent
legislation) as in effect in any applicable jurisdiction.

"Unadjusted Eurodollar Rate Component” means that component of the interest
costs to Company in respect of a Eurodollar Rate Loan that is based upon the
rate obtained pursuant to clause (i) of the definition of Adjusted Eurodollar
Rate.

"Unrestricted Subsidiary” means any Subsidiary of the Company that is designated
by the Board of Directors of the Company as an Unrestricted Subsidiary pursuant
to a resolution of the Board of Directors, but only to the extent that such
Subsidiary:

(i) has no Indebtedness other than Non-Recourse Debt;

(ii) except as permitted by Section 6.12 hereof, is not party to any agreement,
contract, arrangement or understanding with the Company or any Restricted
Subsidiary of the Company unless the terms of any such agreement, contract,
arrangement or understanding are no less favorable to the Company or such
Restricted Subsidiary than those that might be obtained at the time from Persons
who are not Affiliates of the Company;

(iii) is a Person with respect to which neither the Company nor any of its
Restricted Subsidiaries has any direct or indirect obligation (A) to subscribe
for additional Capital Stock or (B) to maintain or preserve such Person’s
financial condition or to cause such Person to achieve any specified levels of
operating results; and

(iv) has not guaranteed or otherwise directly or indirectly provided credit
support for any Indebtedness of the Company or any of its Restricted
Subsidiaries.

"Unused Revolving Commitment Amount” means, with respect to a Lender at any
time, (a) the lesser of (i) such Lender’s Revolving Commitment at such time and
(ii) such Lender’s Pro Rata Share of the Borrowing Base then in effect at such
time minus (b) the sum of (i) the aggregate outstanding principal amount of all
Revolving Loans owed to such Lender at such time and (ii) such Lender’s Pro Rata
Share of the aggregate Letter of Credit Usage at such time.

"Utilization” means, on any day of its determination, (a) the Total Utilization
of Revolving Commitments on BNPP’s close of business in New York City on such
day divided by (b) the lesser of (i) the Revolving Commitments at such time and
(ii) the Borrowing Base in effect at such time.

"Volumetric Production Payments” means production payment obligations, royalties
or overriding royalties of Company or any of its Restricted Subsidiaries which
are payable from a specified share of production from specific properties
together with all undertakings and obligations in connection therewith.

      “Wells” has the meaning set forth in Section 2.3(b)(iv).

 
   
1.2
  Accounting Terms.

(a) Except as otherwise expressly provided herein, all accounting terms not
otherwise defined herein shall have the meanings assigned to them in conformity
with GAAP. Financial statements and other information required to be delivered
by Company to Lenders pursuant to Section 5.1(a) and 5.1(b) shall be prepared in
accordance with GAAP as in effect at the time of such preparation (and delivered
together with the reconciliation statements provided for in Section 5.1(e), if
applicable). Subject to the foregoing, calculations in connection with the
definitions, covenants and other provisions hereof shall utilize accounting
principles and policies in conformity with those used to prepare the Historical
Financial Statements.

(b) In the event that any “Accounting Change” (as defined below) shall occur and
such change results in a change in the method of calculation of financial
covenants, standards or terms in this Agreement, then Company and the
Administrative Agent agree to enter into negotiations in order to amend such
provisions of this Agreement so as equitably to reflect such Accounting Change
with the desired result that the criteria for evaluating Company’s and its
Subsidiaries’ financial condition shall be the same after such Accounting Change
as if such Accounting Change had not been made. Until such time as such an
amendment shall have been executed and delivered by Company, the Administrative
Agent and the Requisite Lenders, all financial covenants, standards and terms in
this Agreement shall continue to be calculated or construed as if such
Accounting Change had not occurred. “Accounting Change” refers to any change in
accounting principles required by the promulgation of any rule, regulation,
pronouncement or opinion by the Financial Accounting Standards Board of the
American Institute of Certified Public Accountants or, if applicable, the
Securities and Exchange Commission.

1.3 Interpretation, etc.

Any of the terms defined herein may, unless the context otherwise requires, be
used in the singular or the plural, depending on the reference. References
herein to any Section, Appendix, Schedule or Exhibit shall be to a Section, an
Appendix, a Schedule or an Exhibit, as the case may be, hereof unless otherwise
specifically provided. The use herein of the word “include” or “including”, when
following any general statement, term or matter, shall not be construed to limit
such statement, term or matter to the specific items or matters set forth
immediately following such word or to similar items or matters, whether or not
no limiting language (such as “without limitation” or “but not limited to” or
words of similar import) is used with reference thereto, but rather shall be
deemed to refer to all other items or matters that fall within the broadest
possible scope of such general statement, term or matter. Any definition of or
reference to any agreement, instrument or other document (including any
Organization Document) shall be construed as referring to such agreement,
instrument or other document as from time to time amended, supplemented or
otherwise modified (subject to any restrictions on such amendments, supplements
or modifications set forth herein or in any other Credit Document).

     
SECTION 2
2.1
2.2
  LOANS AND LETTERS OF CREDIT
[Reserved].
Revolving Loans.

(a) Revolving Commitments. During the Revolving Commitment Period, subject to
the terms and conditions hereof, each Lender severally agrees to make Revolving
Loans to Company in an aggregate amount up to but not exceeding such Lender’s
Unused Revolving Commitment Amount; provided, that after giving effect to the
making of any Revolving Loans in no event shall the Total Utilization of
Revolving Commitments exceed the lesser of (i) Revolving Commitments then in
effect and (ii) the Borrowing Base then in effect. Amounts borrowed pursuant to
this Section 2.2(a) may be repaid and reborrowed during the Revolving Commitment
Period. Each Lender’s Revolving Commitment shall expire on the Revolving
Commitment Termination Date and all Revolving Loans and all other amounts owed
hereunder with respect to the Revolving Loans and the Revolving Commitments
shall be paid in full no later than such date.

(b) Borrowing Mechanics for Revolving Loans.

(i) Except pursuant to 2.4(d), Revolving Loans shall be made in an aggregate
minimum amount of $1,000,000 and integral multiples of $1,000,000 in excess of
that amount.

(ii) Whenever Company desires that Lenders make Revolving Loans, Company shall
deliver to Administrative Agent a fully executed and delivered Funding Notice no
later than 10:00 a.m. (New York City time) at least three Business Days in
advance of the proposed Credit Date in the case of a Eurodollar Rate Loan, and
at least one Business Day in advance of the proposed Credit Date in the case of
a Revolving Loan that is a Base Rate Loan. Except as otherwise provided herein,
a Funding Notice for a Revolving Loan that is a Eurodollar Rate Loan shall be
irrevocable on and after the related Interest Rate Determination Date, and
Company shall be bound to make a borrowing in accordance therewith.

(iii) Notice of receipt of each Funding Notice in respect of Revolving Loans,
together with the amount of each Lender’s Pro Rata Share thereof, if any,
together with the applicable interest rate, shall be provided by Administrative
Agent to each applicable Lender by telefacsimile with reasonable promptness, but
(provided Administrative Agent shall have received such notice by 10:00 a.m.
(New York City time)) and not later than 2:00 p.m. (New York City time) on the
same day as Administrative Agent’s receipt of such Notice from Company.

(iv) Each Lender shall make the amount of its Revolving Loan available to
Administrative Agent not later than 12:00 p.m. (New York City time) on the
applicable Credit Date by wire transfer of same day funds in Dollars, at the
Principal Office designated by Administrative Agent. Except as provided herein,
upon satisfaction or waiver of the conditions precedent specified herein,
Administrative Agent shall make the proceeds of such Revolving Loans available
to Company promptly after receipt from the Lenders on the applicable Credit Date
by causing an amount of same day funds in Dollars equal to the proceeds of all
such Revolving Loans received by Administrative Agent from Lenders to be
credited to the account of Company at the Principal Office designated by
Administrative Agent or such other account as may be designated in writing to
Administrative Agent by Company.

2.3 Borrowing Base.

(a) Borrowing Base. The initial Borrowing Base in effect as of the date of this
Agreement has been set by the Administrative Agent and the Revolving Lenders and
acknowledged by the Company as $80,250,000. Such initial Borrowing Base shall
remain in effect until the next redetermination made pursuant to this
Section 2.3. The Borrowing Base shall be determined in accordance with the
standards set forth in Section 2.3(d) and is subject to periodic redetermination
pursuant to Sections 2.3(b) and 2.3(c).

(b) Calculation of Borrowing Base.

(i) The Company shall deliver to the Administrative Agent and each of the
Revolving Lenders on or before March 1, 2006 and on or before the first day of
each March thereafter, an Independent Engineering Report dated effective as of
the immediately preceding January 1, and such other information as may be
reasonably requested by any Revolving Lender with respect to the Oil and Gas
Properties included or to be included in the Borrowing Base. The Administrative
Agent shall promptly, and in any event within 30 days after the Administrative
Agent’s and the Revolving Lenders’ receipt of such Independent Engineering
Report and other information, deliver to each Revolving Lender the
Administrative Agent’s recommendation for the redetermined Borrowing Base. The
Administrative Agent and the Revolving Lenders shall promptly, and in any event
on the later of (A) April 1 and (B) 15 days after the Revolving Lenders’ receipt
of the Administrative Agent’s recommendation, redetermine the Borrowing Base in
accordance with Section 2.3(d), and the Administrative Agent shall promptly
notify the Company in writing of the amount of the Borrowing Base as so
redetermined, which redetermined Borrowing Base shall become effective as of the
date of such notice.

(ii) The Company shall deliver to the Administrative Agent and each Revolving
Lender on or before September 1 of each year beginning September 1, 2005 an
Internal Engineering Report dated effective as of the immediately preceding July
1 and such other information as may be reasonably requested by the
Administrative Agent or any Revolving Lender with respect to the Oil and Gas
Properties included or to be included in the Borrowing Base. The Administrative
Agent shall promptly, and in any event within 30 days after the Administrative
Agent’s and the Revolving Lenders’ receipt of such Internal Engineering Report
and other information, deliver to each Revolving Lender the Administrative
Agent’s recommendation for the redetermined Borrowing Base. The Administrative
Agent and the Revolving Lenders shall promptly, and in any event on the later of
(A) October 1 and (B) 15 days after the Revolving Lenders’ receipt of the
Administrative Agent’s recommendation, redetermine the Borrowing Base in
accordance with Section 2.3(d), and the Administrative Agent shall promptly
notify the Company in writing of the amount of the Borrowing Base as so
redetermined, which redetermined Borrowing Base shall become effective as of the
date of such notice.

(iii) In the event that the Company does not furnish to the Administrative Agent
and the Revolving Lenders the Independent Engineering Report, Internal
Engineering Report or other information specified in clauses (i) and (ii) above
by the date specified therein, the Administrative Agent and the Revolving
Lenders may nonetheless redetermine the Borrowing Base and redesignate the
Borrowing Base from time-to-time thereafter as provided herein in their sole
discretion until the Administrative Agent and the Revolving Lenders receive the
relevant Independent Engineering Report, Internal Engineering Report, or other
information, as applicable, whereupon the Administrative Agent and the Revolving
Lenders shall redetermine the Borrowing Base as otherwise specified in this
Section 2.3.

(iv) Each delivery of an Engineering Report by the Company to the Administrative
Agent and the Revolving Lenders shall be delivered with a certificate executed
on behalf of the Company by an Authorized Officer of the Company, which
certificate shall contain a representation and warranty by the Company to the
Administrative Agent and the Revolving Lenders that, except as noted in such
certificate, (A) the Company and the Guarantors, as applicable, own the Oil and
Gas Properties specified therein subject to an Acceptable Security Interest on
not less than 80% of the total value of Proven Reserves indicated therein, and
(B) on and as of the date of such Engineering Report, each Oil and Gas Property
described as “proved developed” therein was developed for oil and gas, and the
wells pertaining to such Oil and Gas Properties that are described therein as
producing wells (“Wells”), were each producing oil and gas in paying quantities,
except for Wells that were utilized as water or gas injection wells or as water
disposal wells. Additionally, the Company shall deliver with each such
Engineering Report a list of any Proven Reserves that have been sold or acquired
by the Company and the Guarantors since the date of the last Engineering Report
delivered to the Administrative Agent.

(c) Interim Redeterminations. In addition to the Borrowing Base redeterminations
provided for in Section 2.3(b), (i) the Administrative Agent may, at the request
of the Requisite Revolving Lenders, upon written notice to the Company and based
on such information as the Administrative Agent and the Revolving Lenders deem
relevant (but in accordance with Section 2.3(d)), make up to two additional
redeterminations of the Borrowing Base during any calendar year period; (ii) the
Company may, by written request to the Administrative Agent, request that the
Administrative Agent and the Revolving Lenders make up to two additional
redeterminations of the Borrowing Base during any calendar year period based on
such information as the Administrative Agent and the Revolving Lenders deem
relevant (but in accordance with Section 2.3(d)); and (iii) the Administrative
Agent or the Requisite Revolving Lenders may request an additional
redetermination in connection with any sale or proposed sale of Oil and Gas
Properties of the Company or any of the Guarantors having a market value of
$10,000,000 or more to the extent any such sale is permitted by this Agreement.
The party requesting the redetermination under the foregoing clauses (i)-(iii)
shall give the other party at least 10 days’ prior written notice that a
redetermination of the Borrowing Base pursuant to this paragraph (c) is to be
performed. In connection with any redetermination of the Borrowing Base under
this Section 2.3(c), the Company shall provide the Administrative Agent and the
Revolving Lenders with such information regarding the Company and the
Guarantors’ business (including, without limitation, its Oil and Gas Properties,
the Proven Reserves, and production relating thereto) as the Administrative
Agent or the Requisite Revolving Lenders may reasonably request, including, in
the case of requests for an increase to the Borrowing Base of $10,000,000 or
more, an updated Independent Engineering Report or Internal Engineering Report,
as agreed between the Company and the Administrative Agent. The Administrative
Agent shall promptly, and in any event within 45 days after the Administrative
Agent and the Revolving Lender’s receipt of such information, and to the extent
applicable, an updated Independent Engineering Report, notify the Company in
writing of each redetermination of the Borrowing Base pursuant to this
Section 2.3(c) and the amount of the Borrowing Base as so redetermined, which
redetermined Borrowing Base shall become effective as of the date of such
notice.

(d) Standards for Redetermination. Each redetermination of the Borrowing Base by
the Administrative Agent and the Revolving Lenders pursuant to this Section 2.3
shall be made (i) in the sole discretion of the Administrative Agent and the
Revolving Lenders (but in accordance with the other provisions of this
Section 2.3(d)), (ii) in accordance with the Administrative Agent’s and the
Revolving Lenders’ customary internal standards and practices for valuing and
redetermining the value of Oil and Gas Properties in connection with reserve
based oil and gas loan transactions, (iii) in conjunction with the most recent
Independent Engineering Report or Internal Engineering Report, as applicable, or
other information received by the Administrative Agent and the Revolving Lenders
relating to the Proven Reserves of the Company and the Guarantors, and
(iv) based upon the estimated value of the Proven Reserves owned by the Company
and the Guarantors as determined by the Administrative Agent and the Revolving
Lenders. In valuing and redetermining the Borrowing Base, the Administrative
Agent and the Revolving Lenders may also consider the business, financial
condition, and Indebtedness obligations of the Company and Guarantors and such
other factors as the Administrative Agent and the Revolving Lenders customarily
deem appropriate. No Proven Reserves shall be included or considered for
inclusion in the Borrowing Base unless the Administrative Agent and the
Revolving Lenders shall have received, at the Company’s expense, evidence of
title reasonably satisfactory in form and substance to the Administrative Agent
that the Administrative Agent has an Acceptable Security Interest in not less
than 80% of the value of the Oil and Gas Properties relating thereto pursuant to
the Security Instruments. If Company has not, within 10 days of the Company’s
receipt from the Administrative Agent of notification of a redetermination of
the Borrowing Base under this Section 2.3 provided the Administrative Agent with
written notice designating a lesser amount as the Borrowing Base, the Borrowing
Base shall remain equal to the redetermined amount in such notice provided by
the Administrative Agent, or, if the Company has provided notice to the
Administrative Agent requesting a lesser amount for the Borrowing Base, the
Borrowing Base shall be established at such lesser amount effective on the date
the Company gives such request and shall, in either case, remain effective until
the Borrowing Base is subsequently redetermined in accordance with this
Section 2.3.

(e) Voting. Any changes in, or renewals of, the Borrowing Base (other than
increases in the Borrowing Base) must be consented to in writing by the
Requisite Revolving Lenders. Any increases in the Borrowing Base must be
consented to in writing by all of the Revolving Lenders.

2.4 Issuance of Letters of Credit and Hedge Letters of Credit.

(a) Letters of Credit. During the Revolving Commitment Period, subject to the
terms and conditions hereof, Issuing Bank agrees to issue Letters of Credit for
the account of Company; provided, that (i) each Letter of Credit shall be
denominated in Dollars; (ii) the stated amount of each Letter of Credit shall be
such amount as is acceptable to Issuing Bank; (iii) after giving effect to such
issuance, in no event shall the Total Utilization of Revolving Commitments
exceed the lesser of (A) the Revolving Commitments then in effect and (B) the
Borrowing Base then in effect; (iv) after giving effect to such issuance, in no
event shall the Letter of Credit Usage exceed the Letter of Credit Sublimit then
in effect; (v) in no event shall any standby Letter of Credit have an expiration
date later than the earlier of (1) five Business Days before the Revolving
Commitment Termination Date and (2) the date which is one year from the date of
issuance of such standby Letter of Credit; and (vi) in no event shall any
commercial Letter of Credit have an expiration date later than the earlier of
(1) five Business Days before the Revolving Loan Commitment Termination Date and
(2) the date which is 180 days from the date of issuance of such commercial
Letter of Credit. Subject to the foregoing, Issuing Bank may agree that a
standby Letter of Credit will automatically be extended for one or more
successive periods not to exceed one year each, unless Issuing Bank elects not
to extend for any such additional period.

(b) Notice of Issuance. Whenever Company desires the issuance (or amendment) of
a Letter of Credit or a Hedge Letter of Credit, it shall deliver to Issuing Bank
and Administrative Agent an Issuance Notice no later than 12:00 p.m. (New York
City time) at least two Business Days in the case of standby letters of credit
and Hedge Letters of Credit or five Business Days in the case of commercial
letters of credit, or in each case such shorter period as may be agreed to by
Issuing Bank in any particular instance, in advance of the proposed date of
issuance or amendment that increases or decreases the stated amount. Upon
satisfaction or waiver of the conditions set forth in Section 3.2, Issuing Bank
shall issue the requested Letter of Credit or Hedge Letter of Credit only in
accordance with Issuing Bank’s standard operating procedures. Upon the issuance
of any Letter of Credit or Hedge Letter of Credit or amendment or modification
to a Letter of Credit or Hedge Letter of Credit, Issuing Bank shall promptly
notify each Lender of such issuance, which notice shall be accompanied by a copy
of such Letter of Credit or Hedge Letter of Credit or amendment or modification
to a Letter of Credit or Hedge Letter of Credit and the amount of such Lender’s
respective participation in such Letter of Credit or Hedge Letter of Credit
pursuant to Section 2.4(e).

(c) Responsibility of Issuing Bank With Respect to Requests for Drawings and
Payments. In determining whether to honor any drawing under any Letter of Credit
or Hedge Letter of Credit by the beneficiary thereof, Issuing Bank shall be
responsible only to examine the documents delivered under such Letter of Credit
or Hedge Letter of Credit with reasonable care so as to ascertain whether they
appear on their face to be in accordance with the terms and conditions of such
Letter of Credit or Hedge Letter of Credit. Subject to the last sentence of this
Section 2.4(c), as between Company and Issuing Bank, Company assumes all risks
of the acts and omissions of, or misuse of the Letters of Credit or Hedge
Letters of Credit issued by Issuing Bank, by the respective beneficiaries of
such Letters of Credit or Hedge Letters of Credit. In furtherance and not in
limitation of the foregoing, Issuing Bank shall not be responsible for: (i) the
form, validity, sufficiency, accuracy, genuineness or legal effect of any
document submitted by any party in connection with the application for and
issuance of any such Letter of Credit or Hedge Letter of Credit, even if it
should in fact prove to be in any or all respects invalid, insufficient,
inaccurate, fraudulent or forged; (ii) the validity or sufficiency of any
instrument transferring or assigning or purporting to transfer or assign any
such Letter of Credit or Hedge 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; (iii) failure of the beneficiary of any
such Letter of Credit or Hedge Letter of Credit to comply fully with any
conditions required in order to draw upon such Letter of Credit or Hedge Letter
of Credit; (iv) errors, omissions, interruptions or delays in transmission or
delivery of any messages, by mail, cable, telegraph, telex or otherwise, whether
or not they be in cipher; (v) errors in interpretation of technical terms;
(vi) any loss or delay in the transmission or otherwise of any document required
in order to make a drawing under any such Letter of Credit or Hedge Letter of
Credit or of the proceeds thereof; (vii) the misapplication by the beneficiary
of any such Letter of Credit or Hedge Letter of Credit of the proceeds of any
drawing under such Letter of Credit or Hedge Letter of Credit; or (viii) any
consequences arising from causes beyond the control of Issuing Bank, including
any Governmental Acts; none of the above shall affect or impair, or prevent the
vesting of, any of Issuing Bank’s rights or powers hereunder. Without limiting
the foregoing and in furtherance thereof, any action taken or omitted by Issuing
Bank under or in connection with the Letters of Credit or Hedge Letters of
Credit or any documents and certificates delivered thereunder, if taken or
omitted in good faith, shall not give rise to any liability on the part of
Issuing Bank to Company. Notwithstanding anything to the contrary contained in
this Section 2.4(c), Company shall retain any and all rights it may have against
Issuing Bank for any liability arising solely out of the gross negligence or
willful misconduct of Issuing Bank.

(d) Reimbursement by Company of Amounts Drawn or Paid Under Letters of Credit.
In the event Issuing Bank has determined to honor a drawing under a Letter of
Credit, it shall promptly notify Company and Administrative Agent, and Company
shall reimburse Issuing Bank on or before the Business Day on which such drawing
is honored (the “Reimbursement Date”) in an amount in Dollars and in same day
funds equal to the amount of such honored drawing; provided, anything contained
herein to the contrary notwithstanding, (i) unless Company shall have notified
Administrative Agent and Issuing Bank prior to 10:00 a.m. (New York City time)
on the date such drawing is honored that Company intends to reimburse Issuing
Bank for the amount of such honored drawing with funds other than the proceeds
of Revolving Loans, Company shall be deemed to have given a timely Funding
Notice to Administrative Agent requesting Lenders to make Revolving Loans that
are Base Rate Loans on the Reimbursement Date in an amount in Dollars equal to
the amount of such honored drawing, and (ii) subject to satisfaction or waiver
of the conditions specified in Section 3.2, Lenders shall, on the Reimbursement
Date, make Revolving Loans that are Base Rate Loans in the amount of such
honored drawing, the proceeds of which shall be applied directly by
Administrative Agent to reimburse Issuing Bank for the amount of such honored
drawing; and provided further, if for any reason proceeds of Revolving Loans are
not received by Issuing Bank on the Reimbursement Date in an amount equal to the
amount of such honored drawing, Company shall reimburse Issuing Bank, on demand,
in an amount in same day funds equal to the excess of the amount of such honored
drawing over the aggregate amount of such Revolving Loans, if any, which are so
received. Nothing in this Section 2.4(d) shall be deemed to relieve any Lender
from its obligation to make Revolving Loans on the terms and conditions set
forth herein, and Company shall retain any and all rights it may have against
any Lender resulting from the failure of such Lender to make such Revolving
Loans under this Section 2.4(d).

(e) Lenders’ Purchase of Participations in Letters of Credit and Hedge Letters
of Credit. Immediately upon the issuance of each Letter of Credit or Hedge
Letter of Credit, each Lender having a Revolving Commitment or Hedge L/C
Commitment, as applicable, shall be deemed to have purchased, and hereby agrees
to irrevocably purchase, from Issuing Bank a participation in such Letter of
Credit or Hedge Letter of Credit, as the case may be, and any drawings honored
thereunder in an amount equal to such Lender’s Pro Rata Share (with respect to
the Revolving Commitments or Hedge L/C Commitments, as applicable) of the
maximum amount which is or at any time may become available to be drawn
thereunder. In the event that Company shall fail for any reason to reimburse
Issuing Bank as provided in Section 2.4(d) (with respect to Letters of Credit)
or Section 2.4(i) (with respect to Hedge Letters of Credit), and in each case as
the same has not been repaid from the proceeds of Revolving Loans in accordance
with Section 2.4(d) or a Hedge L/C Loan in accordance with Section 2.4(i),
Issuing Bank shall promptly notify each Lender of the unreimbursed amount of
such honored drawing and of such Lender’s respective participation therein based
on such Lender’s Pro Rata Share of the Revolving Commitments or the Hedge L/C
Commitments, as applicable. Each Lender shall make available to Issuing Bank an
amount equal to its respective participation, in Dollars and in same day funds,
at the office of Issuing Bank specified in such notice, not later than
12:00 p.m. (New York City time) on the first business day (under the laws of the
jurisdiction in which such office of Issuing Bank is located) after the date
notified by Issuing Bank. In the event that any Lender fails to make available
to Issuing Bank on such business day the amount of such Lender’s participation
in such Letter of Credit or Hedge Letter of Credit, as applicable, as provided
in this Section 2.4(e), Issuing Bank shall be entitled to recover such amount on
demand from such Lender together with interest thereon for three Business Days
at the rate customarily used by Issuing Bank for the correction of errors among
banks and thereafter at the Base Rate. Nothing in this Section 2.4(e) shall be
deemed to prejudice the right of any Lender to recover from Issuing Bank any
amounts made available by such Lender to Issuing Bank pursuant to this Section
in the event that it is determined that the payment with respect to a Letter of
Credit or Hedge Letter of Credit in respect of which payment was made by such
Lender constituted gross negligence or willful misconduct on the part of Issuing
Bank. In the event Issuing Bank shall have been reimbursed by other Lenders
pursuant to this Section 2.4(e) for all or any portion of any drawing honored by
Issuing Bank under a Letter of Credit or Hedge Letter of Credit, such Issuing
Bank shall distribute to each Lender which has paid all amounts payable by it
under this Section 2.4(e) with respect to such honored drawing such Lender’s Pro
Rata Share of all payments subsequently received by Issuing Bank from Company in
reimbursement of such honored drawing when such payments are received. Any such
distribution shall be made to a Lender at its primary address set forth below
its name on Appendix B or at such other address as such Lender may request.

(f) Obligations Absolute. The obligation of Company to reimburse Issuing Bank
for drawings honored under the Letters of Credit or Hedge Letters of Credit
issued by it and to repay any Revolving Loans made by Lenders pursuant to
Section 2.4(d) and the obligations of Lenders under Section 2.4(e) shall be
unconditional and irrevocable and shall be paid strictly in accordance with the
terms hereof under all circumstances including any of the following
circumstances: (i) any lack of validity or enforceability of any Letter of
Credit or Hedge Letter of Credit; (ii) the existence of any claim, set-off,
defense or other right which Company or any Lender may have at any time against
a beneficiary or any transferee of any Letter of Credit or Hedge Letter of
Credit (or any Persons for whom any such transferee may be acting), Issuing
Bank, Lender or any other Person or, in the case of a Lender, against Company,
whether in connection herewith, the transactions contemplated herein or any
unrelated transaction (including any underlying transaction between Company or
one of its Subsidiaries and the beneficiary for which any Letter of Credit or
Hedge Letter of Credit was procured); (iii) any draft or other document
presented under any Letter of Credit or Hedge 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; (iv) payment by Issuing Bank
under any Letter of Credit or Hedge Letter of Credit against presentation of a
draft or other document which does not substantially comply with the terms of
such Letter of Credit or Hedge Letter of Credit; (v) any adverse change in the
business, operations, properties, assets, condition (financial or otherwise) or
prospects of Company or any of its Subsidiaries; (vi) any breach hereof or any
other Credit Document by any party thereto; (vii) any other circumstance or
happening whatsoever, whether or not similar to any of the foregoing; or
(viii) the fact that an Event of Default or a Default shall have occurred and be
continuing; provided, in each case, that payment by Issuing Bank under the
applicable Letter of Credit or Hedge Letter of Credit shall not have constituted
gross negligence or willful misconduct of Issuing Bank under the circumstances
in question.

(g) Indemnification. Without duplication of any obligation of Company under
Section 10.2 or 10.3, in addition to amounts payable as provided herein, Company
hereby agrees to protect, indemnify, pay and save harmless Issuing Bank from and
against any and all claims, demands, liabilities, damages, losses, costs,
charges and expenses (including reasonable fees, expenses and disbursements of
counsel) which Issuing Bank may incur or be subject to as a consequence, direct
or indirect, of (i) the issuance of any Letter of Credit or Hedge Letter of
Credit by Issuing Bank, other than as a result of (1) the gross negligence or
willful misconduct of Issuing Bank or (2) the wrongful dishonor by Issuing Bank
of a proper demand for payment made under any Letter of Credit or Hedge Letter
of Credit issued by it, or (ii) the failure of Issuing Bank to honor a drawing
under any such Letter of Credit or Hedge Letter of Credit as a result of any
Governmental Act.

(h) Hedge Letters of Credit. During the Hedge L/C Commitment Period, subject to
the terms and conditions hereof, Issuing Bank hereby agrees to issue Hedge
Letters of Credit for the account of Company in an amount not to exceed the
aggregate Hedge L/C Commitments; provided that each such Hedge Letter of Credit
shall be used by Company solely to secure Company’s obligations under the J.
Aron Swap. The aggregate outstanding amount of Hedge Letters of Credit shall not
exceed the aggregate Hedge L/C Commitment at any time. Each of the Lenders, the
Agents, the Issuing Bank and Company agrees that (A) the obligations related to
each such Hedge Letter of Credit shall constitute Obligations for all purposes
of this Agreement and the other Credit Documents, unless otherwise specifically
excluded therefrom and (B) each such Hedge Letter of Credit shall be entitled
and subject to all other rights, remedies, benefits, duties and obligations
contained in the Credit Documents, including, without limitation, the benefits
of the Liens of the Collateral Trustee on the Collateral. In no event shall any
Hedge Letter of Credit have an expiration date later than the earlier of (1) the
Hedge L/C Commitment Termination Date and (2) the date which is one year from
the date of issuance of such Hedge Letter of Credit. Subject to the foregoing,
Issuing Bank may agree that a Hedge Letter of Credit will automatically be
extended for one or more successive periods not to exceed one year each, unless
Issuing Bank elects not to extend for any such additional period; provided, in
the event a Funding Default exists, Issuing Bank shall not be required to issue
any Hedge Letter of Credit unless Issuing Bank has entered into arrangements
satisfactory to it and Company to eliminate Issuing Bank’s risk with respect to
the participation in Hedge Letters of Credit of the Defaulting Lender, including
by cash collateralizing such Defaulting Lender’s Pro Rata Share of the Hedge
Letter of Credit Usage.

(i) Drawing and Reimbursement re Hedge Letters of Credit. The payment by the
Issuing Bank of a drawing under a Hedge Letter of Credit shall constitute the
making by the Issuing Bank of a loan in the amount of such payment. In the event
Issuing Bank has determined to honor a drawing under a Hedge Letter of Credit,
it shall immediately notify Company and Administrative Agent, and Company shall
reimburse Issuing Bank on or before the Business Day on which such drawing is
honored (the “Hedge L/C Reimbursement Date”) in an amount in Dollars and in same
day funds equal to the amount of such honored drawing; provided, anything
contained herein to the contrary notwithstanding, (i) unless Company shall have
notified Administrative Agent and Issuing Bank prior to 10:00 a.m. (New York
City time) on the date such drawing is honored that Company intends to reimburse
Issuing Bank for the amount of such honored drawing with funds other than the
proceeds of Hedge L/C Loans, Company shall be deemed to have given a timely
Funding Notice to Administrative Agent requesting Lenders to make Hedge L/C
Loans that are Base Rate Loans on the Hedge L/C Reimbursement Date in an amount
in Dollars equal to the amount of such honored drawing, and (ii) subject to
satisfaction or waiver of the conditions specified in Section 3.2, Lenders
shall, on the Hedge L/C Reimbursement Date, make Hedge L/C Loans that are Base
Rate Loans in the amount of such honored drawing, the proceeds of which shall be
applied directly by Administrative Agent to reimburse Issuing Bank for the
amount of such honored drawing; and provided further, if for any reason proceeds
of Hedge L/C Loans are not received by Issuing Bank on the Hedge L/C
Reimbursement Date in an amount equal to the amount of such honored drawing,
Company shall reimburse Issuing Bank, on demand, in an amount in same day funds
equal to the excess of the amount of such honored drawing over the aggregate
amount of such Hedge L/C Loans, if any, which are so received. Nothing in this
Section 2.4(i) shall be deemed to relieve any Lender from its obligation to make
Hedge L/C Loans on the terms and conditions set forth herein, and Company shall
retain any and all rights it may have against any Lender resulting from the
failure of such Lender to make such Hedge L/C Loans under this Section 2.4(i).

(j) Replacement of Issuing Bank. If the Issuing Bank (the “Current Issuing
Bank”) fails to meet the Letter of Credit Issuer Rating or defaults in making
any required payment pursuant to a Letter of Credit or Hedge Letter of Credit,
it shall promptly notify the Administrative Agent and the Company. If the
Issuing Bank fails to meet the Letter of Credit Issuer Rating or defaults in
making any required payment pursuant to a Letter of Credit or Hedge Letter of
Credit, and regardless of whether Company or Administrative Agent shall have
received the notice referred to in the immediately preceding sentence,
(i) Company shall be permitted to locate a banking institution (including any
Lender) to act as the new Issuing Bank (the “Replacement Issuing Bank”) and
(ii) the Administrative Agent shall use commercially reasonable efforts to
assist the Company in locating a Replacement Issuing Bank. Any Replacement
Issuing Bank must meet the Letter of Credit Issuer Rating. In connection with
such replacement, Company shall have caused each outstanding Letter of Credit or
Hedge Letter of Credit, as applicable, issued thereby to be cancelled or
returned to the Current Issuing Bank. Current Issuing Bank agrees to cooperate
and provide all needed documentation reasonably required to effect the foregoing
replacement.

(k) [Reserved].

(l) Letter of Credit Applications. If required by its standard operating
procedures, the Issuing Bank may require Company to execute and deliver one or
more letter of credit applications or similar documents (“Applications”) in
connection with the issuance by the Issuing Bank of any Letter of Credit or
Hedge Letter of Credit. Notwithstanding the terms and provisions of any such
Application and the fact that Company executes and delivers such Application
after the date this Agreement is executed and delivered, any provision of any
Application that purports to add additional interest, charges or rights to
indemnification not found in this Agreement, that provides for additional or
different defaults, events of default, or grace periods not found in this
Agreement, that purports to create additional security interests not provided
for in this Agreement or any Credit Document, that purports to require the
posting of additional cash collateral or other security, or that is otherwise
inconsistent with, or in conflict with, any provision of this Agreement or any
Credit Document, shall not have any force or effect and the provisions of this
Agreement and the Credit Documents shall apply.

2.5 Pro Rata Shares; Availability of Funds.

(a) Pro Rata Shares. All Loans shall be made, and all participations purchased,
by Lenders simultaneously and proportionately to their respective Pro Rata
Shares, it being understood that no Lender shall be responsible for any default
by any other Lender in such other Lender’s obligation to make a Loan requested
hereunder or purchase a participation required hereby nor shall any Revolving
Commitment or Hedge L/C Commitment of any Lender be increased or decreased as a
result of a default by any other Lender in such other Lender’s obligation to
make a Loan requested hereunder or purchase a participation required hereby.

(b) Availability of Funds. Unless Administrative Agent shall have been notified
by any Lender prior to the applicable Credit Date that such Lender does not
intend to make available to Administrative Agent the amount of such Lender’s
Loan requested on such Credit Date, Administrative Agent may assume that such
Lender has made such amount available to Administrative Agent on such Credit
Date and Administrative Agent may, in its sole discretion, but shall not be
obligated to, make available to Company a corresponding amount on such Credit
Date. If such corresponding amount is not in fact made available to
Administrative Agent by such Lender, Administrative Agent shall be entitled to
recover such corresponding amount on demand from such Lender together with
interest thereon, for each day from such Credit Date until the date such amount
is paid to Administrative Agent, at the customary rate set by Administrative
Agent for the correction of errors among banks for three Business Days and
thereafter at the Base Rate. If such Lender does not pay such corresponding
amount forthwith upon Administrative Agent’s demand therefor, Administrative
Agent shall promptly notify Company and Company shall immediately pay such
corresponding amount to Administrative Agent together with interest thereon, for
each day from such Credit Date until the date such amount is paid to
Administrative Agent, at the rate payable hereunder for Base Rate Loans for such
Class of Loans. Nothing in this Section 2.5(b) shall be deemed to relieve any
Lender from its obligation to fulfill its Revolving Commitments hereunder or to
prejudice any rights that Company may have against any Lender as a result of any
default by such Lender hereunder.

2.6 Use of Proceeds. Amounts available under the Revolving Commitments shall be
used for general corporate purposes of Company, including Permitted Acquisitions
and refinancing of Indebtedness existing on the Closing Date. Amounts available
under the Hedge L/C Commitments shall be used solely to provide credit support
to Company’s obligations under the J. Aron Swap as in effect on the Closing
Date. No portion of the proceeds of any Credit Extension shall be used in any
manner that causes or might cause such Credit Extension or the application of
such proceeds to violate Regulation T, Regulation U or Regulation X of the Board
of Governors of the Federal Reserve System or any other regulation thereof or to
violate the Exchange Act.

2.7 Evidence of Debt; Register; Lenders’ Books and Records; Notes.

(a) Lenders’ Evidence of Debt. Each Lender shall maintain on its internal
records an account or accounts evidencing the Obligations of Company to such
Lender, including the amounts of the Loans made by it and each repayment and
prepayment in respect thereof. Any such recordation shall be conclusive and
binding on Company, absent manifest error; provided, that the failure to make
any such recordation, or any error in such recordation, shall not affect any
Lender’s Revolving Commitments or Company’s Obligations in respect of any
applicable Loans; and provided further, in the event of any inconsistency
between the Register and any Lender’s records, the recordations in the Register
shall govern.

(b) Register. Administrative Agent (or its agent or sub-agent appointed by it)
shall maintain at the Principal Office a register for the recordation of the
names and addresses of Lenders and the Revolving Commitments, the Hedge L/C
Commitments and Loans of each Lender from time to time (the “Register”). The
Register, as in effect at the close of business on the preceding Business Day,
shall be available for inspection by Company or any Lender at any reasonable
time and from time to time upon reasonable prior notice. Administrative Agent
shall record, or shall cause to be recorded, in the Register the Revolving
Commitments, Hedge L/C Commitments and the Loans in accordance with the
provisions of Section 10.6, and each repayment or prepayment in respect of the
principal amount of the Loans, and any such recordation shall be conclusive and
binding on Company and each Lender, absent manifest error; provided, failure to
make any such recordation, or any error in such recordation, shall not affect
any Lender’s Revolving Commitments, Hedge L/C Commitments or Company’s
Obligations in respect of any Loan. Company hereby designates BNPP to serve as
Company’s agent solely for purposes of maintaining the Register as provided in
this Section 2.7, and Company hereby agrees that, BNPP and its officers,
directors, employees, agents, sub-agents and affiliates shall constitute
“Indemnitees.”

(c) Notes. If so requested by any Lender by written notice to Company (with a
copy to Administrative Agent) at least two Business Days prior to the Closing
Date, or at any time thereafter, Company shall execute and deliver to such
Lender (and/or, if applicable and if so specified in such notice, to any Person
who is an assignee of such Lender pursuant to Section 10.6) on the Closing Date
(or, if such notice is delivered after the Closing Date, promptly after
Company’s receipt of such notice) a Note or Notes to evidence such Lender’s
Revolving Loan or Hedge L/C Loan, as the case may be.

2.8 Interest on Loans.

(a) Except as otherwise set forth herein, each Type of Loan shall bear interest
on the unpaid principal amount thereof from the date made through repayment
(whether by acceleration or otherwise) thereof as follows:

(i) if a Base Rate Loan, at the Base Rate plus the Applicable Margin; or

(ii) if a Eurodollar Rate Loan, at the Adjusted Eurodollar Rate plus the
Applicable Margin.

(b) The basis for determining the rate of interest with respect to any Loan, and
the Interest Period with respect to any Eurodollar Rate Loan, shall be selected
by Company and notified to Administrative Agent and Lenders pursuant to the
applicable Funding Notice or Conversion/Continuation Notice, as the case may be.
If on any day a Loan is outstanding with respect to which a Funding Notice or
Conversion/Continuation Notice has not been delivered to Administrative Agent in
accordance with the terms hereof specifying the applicable basis for determining
the rate of interest, then for that day such Loan shall be a Base Rate Loan.

(c) In connection with Eurodollar Rate Loans, there shall be no more than six
(6) Interest Periods outstanding at any time. In the event Company fails to
specify between a Base Rate Loan or a Eurodollar Rate Loan in the applicable
Funding Notice or Conversion/Continuation Notice, such Loan (if outstanding as a
Eurodollar Rate Loan) will be automatically continued as a Eurodollar Rate Loan
with an Interest Period of the same duration on the last day of the then-current
Interest Period for such Loan (or if outstanding as a Base Rate Loan will remain
as, or (if not then outstanding) will be made as, a Base Rate Loan). In the
event Company fails to specify an Interest Period for any Eurodollar Rate Loan
in the applicable Funding Notice or Conversion/Continuation Notice, Company
shall be deemed to have selected an Interest Period of one month. As soon as
practicable after 10:00 a.m. (New York City time) on each Interest Rate
Determination Date, Administrative Agent shall determine (which determination
shall, absent manifest error, be final, conclusive and binding upon all parties)
the interest rate that shall apply to the Eurodollar Rate Loans for which an
interest rate is then being determined for the applicable Interest Period and
shall promptly give notice thereof (in writing or by telephone confirmed in
writing) to Company and each Lender.

(d) Interest payable pursuant to Section 2.8(a) shall be computed (i) in the
case of Base Rate Loans on the basis of a 365-day or 366-day year, as the case
may be, and (ii) in the case of Eurodollar Rate Loans, on the basis of a 360-day
year, in each case for the actual number of days elapsed in the period during
which it accrues. In computing interest on any Loan, the date of the making of
such Loan or the first day of an Interest Period applicable to such Loan or,
with respect to a Base Rate Loan being converted from a Eurodollar Rate Loan,
the date of conversion of such Eurodollar Rate Loan to such Base Rate Loan, as
the case may be, shall be included, and the date of payment of such Loan or the
expiration date of an Interest Period applicable to such Loan or, with respect
to a Base Rate Loan being converted to a Eurodollar Rate Loan, the date of
conversion of such Base Rate Loan to such Eurodollar Rate Loan, as the case may
be, shall be excluded; provided, if a Loan is repaid on the same day on which it
is made, one day’s interest shall be paid on that Loan.

(e) Except as otherwise set forth herein, interest on each Loan (i) shall accrue
on a daily basis and shall be payable in arrears on each Interest Payment Date
with respect to interest accrued on and to each such payment date; (ii) shall
accrue on a daily basis and shall be payable in arrears upon any prepayment of
that Loan, whether voluntary or mandatory, to the extent accrued on the amount
being prepaid; and (iii) shall accrue on a daily basis and shall be payable in
arrears at maturity of the Loans, including final maturity of the Loans;
provided, however, with respect to any voluntary prepayment of a Base Rate Loan,
accrued interest shall instead be payable on the applicable Interest Payment
Date.

(f) Company agrees to pay to Issuing Bank, with respect to drawings honored
under any Letter of Credit or Hedge Letter of Credit, interest on the amount
paid by Issuing Bank in respect of each such honored drawing from the date such
drawing is honored to but excluding the date such amount is reimbursed by or on
behalf of Company at a rate equal to (i) for the period from the date such
drawing is honored to but excluding the applicable Reimbursement Date, the rate
of interest otherwise payable hereunder with respect to Revolving Loans that are
Base Rate Loans, and (ii) thereafter, a rate which is 2% per annum in excess of
the rate of interest otherwise payable hereunder with respect to Revolving Loans
that are Base Rate Loans.

(g) Interest payable pursuant to Section 2.8(f) shall be computed on the basis
of a 365/366-day year for the actual number of days elapsed in the period during
which it accrues, and shall be payable on demand or, if no demand is made, on
the date on which the related drawing under a Letter of Credit or Hedge Letter
of Credit, as the case may be, is reimbursed in full. Promptly upon receipt by
Issuing Bank of any payment of interest pursuant to Section 2.8(f), Issuing Bank
shall distribute to each Lender, out of the interest received by Issuing Bank in
respect of the period from the date such drawing is honored to but excluding the
date on which Issuing Bank is reimbursed for the amount of such drawing
(including any such reimbursement out of the proceeds of any Revolving Loans or
Hedge L/C Loan), the amount that such Lender would have been entitled to receive
in respect of the letter of credit fee that would have been payable in respect
of such Letter of Credit or Hedge Letter of Credit, as the case may be, for such
period if no drawing had been honored under such Letter of Credit or Hedge
Letter of Credit. In the event Issuing Bank shall have been reimbursed by
Lenders for all or any portion of such honored drawing, Issuing Bank shall
distribute to each Lender which has paid all amounts payable by it under
Section 2.4(e) with respect to such honored drawing such Lender’s Pro Rata Share
of any interest received by Issuing Bank in respect of that portion of such
honored drawing so reimbursed by Lenders for the period from the date on which
Issuing Bank was so reimbursed by Lenders to but excluding the date on which
such portion of such honored drawing is reimbursed by Company.

2.9 Conversion/Continuation.

(a) Subject to Section 2.18 and so long as no Default or Event of Default shall
have occurred and then be continuing, Company shall have the option:

(i) to convert at any time all or any part of any Revolving Loan or Hedge L/C
Loan equal to $1,000,000 and integral multiples of $1,000,000 in excess of that
amount from one Type of Loan to another Type of Loan; provided, a Eurodollar
Rate Loan may only be converted on the expiration of the Interest Period
applicable to such Eurodollar Rate Loan unless Company shall pay all amounts due
under Section 2.18 in connection with any such conversion; or

(ii) upon the expiration of any Interest Period applicable to any Eurodollar
Rate Loan, to continue all or any portion of such Loan equal to $5,000,000 and
integral multiples of $1,000,000 in excess of that amount as a Eurodollar Rate
Loan.

(b) Company shall deliver a Conversion/Continuation Notice to Administrative
Agent no later than 10:00 a.m. (New York City time) at least one Business Day in
advance of the proposed conversion date (in the case of a conversion to a Base
Rate Loan) and at least three Business Days in advance of the proposed
conversion/continuation date (in the case of a conversion to, or a continuation
of, a Eurodollar Rate Loan). Except as otherwise provided herein, a
Conversion/Continuation Notice for conversion to, or continuation of, any
Eurodollar Rate Loans (or telephonic notice in lieu thereof) shall be
irrevocable on and after the related Interest Rate Determination Date, and
Company shall be bound to effect a conversion or continuation in accordance
therewith.

2.10 Default Interest. Upon the occurrence and during the continuance of an
Event of Default, the overdue principal amount of all Loans outstanding and, to
the extent permitted by applicable law, any overdue interest payments on the
Loans or any overdue fees or other amounts owed hereunder, shall thereafter bear
interest (including post-petition interest in any proceeding under the
Bankruptcy Code or other applicable bankruptcy laws) payable on demand at a rate
that is 2% per annum in excess of the interest rate otherwise payable hereunder
with respect to the applicable Loans (or, in the case of any such fees and other
amounts, at a rate which is 2% per annum in excess of the interest rate
otherwise payable hereunder for Base Rate Loans); provided, in the case of
Eurodollar Rate Loans, upon the expiration of the Interest Period in effect at
the time any such increase in interest rate is effective such Eurodollar Rate
Loans shall thereupon become Base Rate Loans and any overdue principal amount
thereof shall thereafter bear interest payable upon demand at a rate which is 2%
per annum in excess of the interest rate otherwise payable hereunder for Base
Rate Loans. Payment or acceptance of the increased rates of interest provided
for in this Section 2.10 is not a permitted alternative to timely payment and
shall not constitute a waiver of any Event of Default or otherwise prejudice or
limit any rights or remedies of Administrative Agent or any Lender.

2.11 Fees.

(a) Company agrees to pay to Lenders having Revolving Exposure:

(i) commitment fees equal to (1) the average of the daily difference between
(a) the lesser of (I) the Revolving Commitments then in effect and (II) the
Borrowing Base then in effect, and (b) the Total Utilization of Revolving
Commitments, times (2) the Applicable Margin for commitment fees; and

(ii) during the Letter of Credit Commitment Period, letter of credit fees equal
to (1) the Applicable Margin for Revolving Loans that are Eurodollar Rate Loans,
times (2) the average aggregate daily maximum amount available to be drawn under
all such Letters of Credit (regardless of whether any conditions for drawing
could then be met and determined as of the close of business on any date of
determination).

All fees referred to in this Section 2.11(a) shall be paid to Administrative
Agent at its Principal Office and upon receipt, Administrative Agent shall
promptly distribute to each Lender its Pro Rata Share thereof.

(b) Company agrees to pay to Lenders having Hedge L/C Exposure:

(i) commitment fees equal to (1) the average of the daily difference between
(a) the Hedge L/C Commitments, and (b) the sum of (x) the aggregate principal
amount of outstanding Hedge L/C Loans plus (y) the Hedge Letter of Credit Usage,
times (2) the Applicable Margin for commitment fees; and

(ii) letter of credit fees equal to (1) the Applicable Margin for Revolving
Loans that are Eurodollar Rate Loans, times (2) the average aggregate daily
maximum amount available to be drawn under all such Hedge Letters of Credit
(regardless of whether any conditions for drawing could then be met and
determined as of the close of business on any date of determination).

(c) Company agrees to pay directly to Issuing Bank, for its own account, the
following fees:

(i) a fronting fee with respect to Letters of Credit and Hedge Letters of Credit
equal to (1) 0.15% per annum times (2) the average aggregate daily maximum
amount available to be drawn under all Letters of Credit and Hedge Letters of
Credit issued by such Issuing Bank (regardless of whether any conditions for
drawing could then be met and determined as of the close of business on any date
of determination), but not less than $500; and

(ii) such documentary and processing charges for any issuance, amendment,
transfer or payment of a Letter of Credit or Hedge Letter of Credit, as the case
may be, as are in accordance with Issuing Bank’s standard schedule for such
charges and as in effect at the time of such issuance, amendment, transfer or
payment, as the case may be.

(d) All fees referred to in Sections 2.11(a), (b) and (c)(i) shall be calculated
on the basis of a 360-day year and the actual number of days elapsed and shall
be payable quarterly in arrears on March 31, June 30, September 30 and
December 31 of each year during the Revolving Commitment Period or Hedge L/C
Commitment Period, as applicable, commencing on the first such date to occur
after the Closing Date, and on the Revolving Commitment Termination Date with
respect to the fees referred to in Sections 2.11(a)(i) and (c)(i) (with respect
to Letters of Credit) and (iii) on the Hedge L/C Commitment Termination Date
with respect to the fees referred to in Section 2.11(b) and (c)(i) (with respect
to Hedge Letters of Credit).

(e) In addition to any of the foregoing fees, Company agrees to pay to Agents
such other fees in the amounts and at the times separately agreed upon.

(f) Company agrees to pay a fee to the Administrative Agent for the ratable
benefit of the Revolving Lenders as agreed to between the Company and the
Administrative Agent upon any increase of the Borrowing Base on the amount by
which the Borrowing Base after such increase exceeds the highest previous
Borrowing Base.

2.12 Commitment Reductions.

(a) [Reserved].

(b) Commitment Reductions. The Revolving Commitments and Hedge L/C Commitments,
as the case may be, shall be permanently reduced in connection with any
voluntary or mandatory reductions of the Revolving Commitments or Hedge L/C
Commitments, as the case may be, in accordance with Sections 2.13 and 2.15, as
applicable, and all other amounts owed hereunder with respect thereto shall, in
any event, be paid in full on the Revolving Commitment Termination Date and
Hedge L/C Commitment Termination Date, respectively.

2.13 Voluntary Prepayments/Commitment Reductions.

(a) Voluntary Prepayments.

(i) Any time and from time to time, Company may prepay any Loans on any Business
Day in whole or in part, in an aggregate minimum amount of $1,000,000 and
integral multiples of $1,000,000 in excess of that amount.

(ii) All such prepayments shall be made:

(1) upon not less than one Business Day’s prior written or telephonic notice in
the case of Base Rate Loans; and

(2) upon not less than three Business Days’ prior written or telephonic notice
in the case of Eurodollar Rate Loans.

in each case given to Administrative Agent, by 12:00 p.m. (New York City time)
on the date required and, if given by telephone, promptly confirmed in writing
to Administrative Agent (and Administrative Agent will promptly transmit such
telephonic or original notice by telefacsimile or telephone to each Lender).
Upon the giving of any such notice, the principal amount of the Loans specified
in such notice shall become due and payable on the prepayment date specified
therein. Any such voluntary prepayment shall be applied as specified in
Section 2.15(a).

(b) Voluntary Commitment Reductions.

(i) Company may, upon not less than three Business Days’ prior written or
telephonic notice confirmed in writing to Administrative Agent (which original
written or telephonic notice Administrative Agent will promptly transmit by
telefacsimile or telephone to each applicable Lender), at any time and from time
to time terminate in whole or permanently reduce in part, without premium or
penalty, the Revolving Commitments in an amount up to the amount by which the
Revolving Commitments exceed the Total Utilization of Revolving Commitments at
the time of such proposed termination or reduction; provided, any such partial
reduction of the Revolving Commitments shall be in an aggregate minimum amount
of $1,000,000 and integral multiples of $1,000,000 in excess of that amount.

(ii) Company’s notice to Administrative Agent shall designate the date (which
shall be a Business Day) of such termination or reduction and the amount of any
partial reduction, and such termination or reduction of the Revolving
Commitments shall be effective on the date specified in Company’s notice and
shall reduce the Revolving Commitment of each Lender proportionately to its Pro
Rata Share thereof.

2.14 Mandatory Prepayments/Commitment Reductions.

(a) Borrowing Base Deficiency. If the aggregate outstanding amount of the Total
Utilization of Revolving Commitments ever exceeds the lesser of the
(i) Borrowing Base and (ii) the aggregate Revolving Commitments, the Company
shall after receipt of written notice from the Administrative Agent regarding
such deficiency, deliver to the Administrative Agent within ten days of receipt
of such notice from the Administrative Agent, a written response indicating
which of the following actions it intends to take to remedy the Borrowing Base
deficiency (and the failure of the Company to deliver such election notice or to
perform the action chosen to remedy such Borrowing Base deficiency shall
constitute an election to cure such deficiency pursuant to the following clause
(i)):

(i) prepay Revolving Loans to the extent of the Borrowing Base deficiency set
forth in such notice or, if the Revolving Loans have been repaid in full, make
deposits to the extent of such Borrowing Base deficiency set forth in such
notice into a cash collateral account acceptable to Administrative Agent to
provide cash collateral for the Hedge L/C Exposure, such that the Borrowing Base
deficiency is cured within 90 days after the date such deficiency notice is
received by the Company from the Administrative Agent or

(ii) pledge as Collateral for the Obligations additional Oil and Gas Properties
acceptable to the Administrative Agent and each of Lenders such that the
Borrowing Base deficiency is cured within 60 days after the date such deficiency
notice is received by the Company from the Administrative Agent.

Each prepayment pursuant to this Section 2.14(a) shall be accompanied by accrued
interest on the amount prepaid to the date of such prepayment and amounts, if
any, required to be paid pursuant to Section 2.18(c) as a result of such
prepayment being made on such date. Each prepayment under this Section 2.14(a)
shall be applied to the Revolving Loans as determined by the Administrative
Agent and agreed to by the Requisite Revolving Lenders in their sole discretion.

(b) Insurance/Condemnation Proceeds. No later than the first Business Day
following the date of receipt by Company or any of its Restricted Subsidiaries,
or Administrative Agent as loss payee of any Net Insurance/Condemnation
Proceeds, Company shall prepay the Loans (without a reduction in the Revolving
Commitments) in an aggregate amount equal to such Net Insurance/Condemnation
Proceeds.

(c) [Reserved].

(d) [Reserved].

(e) [Reserved].

(f) Revolving Loans; Hedge L/C Loans. (i) Company shall from time to time prepay
the Revolving Loans to the extent necessary so that the Total Utilization of
Revolving Commitments shall not at any time exceed the Revolving Commitments
then in effect and (ii) Company shall from time to time prepay the Hedge L/C
Loans to the extent necessary so that the Total Utilization of Hedge L/C
Commitments shall not at any time exceed the Hedge L/C Commitments then in
effect.

2.15 Application of Prepayments/Reductions.

(a) Application of Voluntary Prepayments by Type of Loans. Any prepayment of any
Loan pursuant to Section 2.13(a) shall be applied as specified by Company in the
applicable notice of prepayment; provided, in the event Company fails to specify
the Loans to which any such prepayment shall be applied, such prepayment shall
be applied as follows:

first, to repay outstanding Revolving Loans to the full extent thereof; and

second, to repay outstanding Hedge L/C Loans to the full extent thereof.

(b) [Reserved].

(c) Application of Prepayments of Loans to Base Rate Loans and Eurodollar Rate
Loans. Considering each Class of Loans being prepaid separately, any prepayment
thereof shall be applied first to Base Rate Loans to the full extent thereof
before application to Eurodollar Rate Loans, in each case in a manner which
minimizes the amount of any payments required to be made by Company pursuant to
Section 2.18(c).

2.16 General Provisions Regarding Payments.

(a) All payments by Company of principal, interest, fees and other Obligations
shall be made in Dollars in same day funds, without defense, setoff or
counterclaim, free of any restriction or condition, and delivered to
Administrative Agent not later than 12:00 p.m. (New York City time) on the date
due at the Principal Office designated by Administrative Agent for the account
of Lenders; for purposes of computing interest and fees, funds received by
Administrative Agent after that time on such due date shall be deemed to have
been paid by Company on the next succeeding Business Day.

(b) All payments in respect of the principal amount of any Loan (other than
voluntary prepayments of Revolving Loans) shall be accompanied by payment of
accrued interest on the principal amount being repaid or prepaid.

(c) Administrative Agent (or its agent or sub-agent appointed by it) shall
promptly distribute to each Lender at such address as such Lender shall indicate
in writing, such Lender’s applicable Pro Rata Share of all payments and
prepayments of principal and interest due hereunder, together with all other
amounts due thereto, including, without limitation, all fees payable with
respect thereto, to the extent received by Administrative Agent.

(d) Notwithstanding the foregoing provisions hereof, if any
Conversion/Continuation Notice is withdrawn as to any Affected Lender or if any
Affected Lender makes Base Rate Loans in lieu of its Pro Rata Share of any
Eurodollar Rate Loans, Administrative Agent shall give effect thereto in
apportioning payments received thereafter.

(e) Subject to the provisos set forth in the definition of “Interest Period” as
they may apply to Revolving Loans or Hedge L/C Loans, whenever any payment to be
made hereunder with respect to any Loan shall be stated to be due on a day that
is not a Business Day, such payment shall be made on the next succeeding
Business Day and, with respect to Revolving Loans and Hedge L/C Loans only, such
extension of time shall be included in the computation of the payment of
interest hereunder or of the Revolving Commitment fees hereunder.

(f) Company hereby authorizes Administrative Agent to charge Company’s accounts,
if any, with Administrative Agent in order to cause timely payment to be made to
Administrative Agent of all principal, interest, fees and expenses due hereunder
(subject to sufficient funds being available in its accounts for that purpose).

(g) Administrative Agent shall deem any payment by or on behalf of Company
hereunder that is not made in same day funds prior to 1:00 p.m. (New York City
time) to be a non-conforming payment. Any such payment shall not be deemed to
have been received by Administrative Agent until the later of (i) the time such
funds become available funds, and (ii) the applicable next Business Day.
Administrative Agent shall give prompt telephonic notice to Company and each
applicable Lender (confirmed in writing) if any payment is non-conforming. Any
non-conforming payment may constitute or become a Default or Event of Default in
accordance with the terms of Section 8.1(a). Interest shall continue to accrue
on any principal as to which a non-conforming payment is made until such funds
become available funds (but in no event less than the period from the date of
such payment to the next succeeding applicable Business Day) at the rate
determined pursuant to Section 2.10 from the date such amount was due and
payable until the date such amount is paid in full.

(h) If an Event of Default shall have occurred and not otherwise been waived,
and the maturity of the Obligations shall have been accelerated pursuant to
Section 8.1, all payments or proceeds received by Agents hereunder in respect of
any of the Obligations, shall be applied in accordance with the application
arrangements described in Section 7.2 of the Pledge and Security Agreement.

2.17 Ratable Sharing. Lenders hereby agree among themselves that, except as
otherwise provided in the Collateral Documents with respect to amounts realized
from the exercise of rights with respect to Liens on the Collateral, if any of
them shall, whether by voluntary payment (other than a voluntary prepayment of
Loans made and applied in accordance with the terms hereof), through the
exercise of any right of set-off or banker’s lien, by counterclaim or cross
action or by the enforcement of any right under the Credit Documents or
otherwise, or as adequate protection of a deposit treated as cash collateral
under the Bankruptcy Code, receive payment or reduction of a proportion of the
aggregate amount of principal, interest, amounts payable in respect of Letters
of Credit, amounts payable in respect of Hedge Letters of Credit, fees and other
amounts then due and owing to such Lender hereunder or under the other Credit
Documents (collectively, the “Aggregate Amounts Due” to such Lender) which is
greater than the proportion received by any other Lender in respect of the
Aggregate Amounts Due to such other Lender, then the Lender receiving such
proportionately greater payment shall (a) notify Administrative Agent and each
other Lender of the receipt of such payment and (b) apply a portion of such
payment to purchase participations (which it shall be deemed to have purchased
from each seller of a participation simultaneously upon the receipt by such
seller of its portion of such payment) in the Aggregate Amounts Due to the other
Lenders so that all such recoveries of Aggregate Amounts Due shall be shared by
all Lenders in proportion to the Aggregate Amounts Due to them; provided, if all
or part of such proportionately greater payment received by such purchasing
Lender is thereafter recovered from such Lender upon the bankruptcy or
reorganization of Company or otherwise, those purchases shall be rescinded and
the purchase prices paid for such participations shall be returned to such
purchasing Lender ratably to the extent of such recovery, but without interest.
Company expressly consents to the foregoing arrangement and agrees that any
holder of a participation so purchased may exercise any and all rights of
banker’s lien, set-off or counterclaim with respect to any and all monies owing
by Company to that holder with respect thereto as fully as if that holder were
owed the amount of the participation held by that holder.

2.18 Making or Maintaining Eurodollar Rate Loans.

(a) Inability to Determine Applicable Interest Rate. In the event that
Administrative Agent shall have determined (which determination shall be final
and conclusive and binding upon all parties hereto), on any Interest Rate
Determination Date with respect to any Eurodollar Rate Loans, that by reason of
circumstances affecting the London interbank market adequate and fair means do
not exist for ascertaining the interest rate applicable to such Loans on the
basis provided for in the definition of Adjusted Eurodollar Rate, Administrative
Agent shall on such date give notice (by telefacsimile or by telephone confirmed
in writing) to Company and each Lender of such determination, whereupon (i) no
Loans may be made as, or converted to, Eurodollar Rate Loans until such time as
Administrative Agent notifies Company and Lenders that the circumstances giving
rise to such notice no longer exist, and (ii) any Funding Notice or
Conversion/Continuation Notice given by Company with respect to the Loans in
respect of which such determination was made shall be deemed to be rescinded by
Company.

(b) Illegality or Impracticability of Eurodollar Rate Loans. In the event that
on any date any Lender shall have determined (which determination shall be final
and conclusive and binding upon all parties hereto but shall be made only after
consultation with Company and Administrative Agent) that the making, maintaining
or continuation of its Eurodollar Rate Loans (i) has become unlawful as a result
of compliance by such Lender in good faith with any law, treaty, governmental
rule, regulation, guideline or order (or would conflict with any such treaty,
governmental rule, regulation, guideline or order not having the force of law
even though the failure to comply therewith would not be unlawful), or (ii) has
become impracticable, as a result of contingencies occurring after the date
hereof which materially and adversely affect the London interbank market or the
position of such Lender in that market, then, and in any such event, such Lender
shall be an “Affected Lender” and it shall on that day give notice (by
telefacsimile or by telephone confirmed in writing) to Company and
Administrative Agent of such determination (which notice Administrative Agent
shall promptly transmit to each other Lender). Thereafter (1) the obligation of
the Affected Lender to make Loans as, or to convert Loans to, Eurodollar Rate
Loans shall be suspended until such notice shall be withdrawn by the Affected
Lender, (2) to the extent such determination by the Affected Lender relates to a
Eurodollar Rate Loan then being requested by Company pursuant to a Funding
Notice or a Conversion/Continuation Notice, the Affected Lender shall make such
Loan as (or continue such Loan as or convert such Loan to, as the case may be) a
Base Rate Loan, (3) the Affected Lender’s obligation to maintain its outstanding
Eurodollar Rate Loans (the “Affected Loans”) shall be terminated at the earlier
to occur of the expiration of the Interest Period then in effect with respect to
the Affected Loans or when required by law, and (4) the Affected Loans shall
automatically convert into Base Rate Loans on the date of such termination.
Notwithstanding the foregoing, to the extent a determination by an Affected
Lender as described above relates to a Eurodollar Rate Loan then being requested
by Company pursuant to a Funding Notice or a Conversion/Continuation Notice,
Company shall have the option, subject to the provisions of Section 2.18(c), to
rescind such Funding Notice or Conversion/Continuation Notice as to all Lenders
by giving notice (by telefacsimile or by telephone confirmed in writing) to
Administrative Agent of such rescission on the date on which the Affected Lender
gives notice of its determination as described above (which notice of rescission
Administrative Agent shall promptly transmit to each other Lender). Except as
provided in the immediately preceding sentence, nothing in this Section 2.18(b)
shall affect the obligation of any Lender other than an Affected Lender to make
or maintain Loans as, or to convert Loans to, Eurodollar Rate Loans in
accordance with the terms hereof.

(c) Compensation for Breakage or Non-Commencement of Interest Periods. Company
shall compensate each Lender, upon written request by such Lender (which request
shall set forth the basis for requesting such amounts), for all reasonable
losses, expenses and liabilities (including any interest paid by such Lender to
Lenders of funds borrowed by it to make or carry its Eurodollar Rate Loans and
any loss, expense or liability sustained by such Lender in connection with the
liquidation or re-employment of such funds but excluding loss of anticipated
profits) which such Lender may sustain: (i) if for any reason (other than a
default by such Lender) a borrowing of any Eurodollar Rate Loan does not occur
on a date specified therefor in a Funding Notice or a telephonic request for
borrowing, or a conversion to or continuation of any Eurodollar Rate Loan does
not occur on a date specified therefor in a Conversion/Continuation Notice or a
telephonic request for conversion or continuation; (ii) if any prepayment or
other principal payment of, or any conversion of, any of its Eurodollar Rate
Loans occurs on a date prior to the last day of an Interest Period applicable to
that Loan; or (iii) if any prepayment of any of its Eurodollar Rate Loans is not
made on any date specified in a notice of prepayment given by Company.

(d) Booking of Eurodollar Rate Loans. Any Lender may make, carry or transfer
Eurodollar Rate Loans at, to, or for the account of any of its branch offices or
the office of an Affiliate of such Lender.

(e) Assumptions Concerning Funding of Eurodollar Rate Loans. Calculation of all
amounts payable to a Lender under this Section 2.18 and under Section 2.19 shall
be made as though such Lender had actually funded each of its relevant
Eurodollar Rate Loans through the purchase of a Eurodollar deposit bearing
interest at the rate obtained pursuant to clause (i) of the definition of
Adjusted Eurodollar Rate in an amount equal to the amount of such Eurodollar
Rate Loan and having a maturity comparable to the relevant Interest Period and
through the transfer of such Eurodollar deposit from an offshore office of such
Lender to a domestic office of such Lender in the United States of America;
provided, however, each Lender may fund each of its Eurodollar Rate Loans in any
manner it sees fit and the foregoing assumptions shall be utilized only for the
purposes of calculating amounts payable under this Section 2.18 and under
Section 2.19.

2.19 Increased Costs; Capital Adequacy.

(a) Compensation For Increased Costs and Taxes. Subject to the provisions of
Section 2.20 (which shall be controlling with respect to the matters covered
thereby), in the event that any Lender (which term shall include Issuing Bank
for purposes of this Section 2.19(a)) shall determine (which determination
shall, absent manifest error, be final and conclusive and binding upon all
parties hereto) that any law, treaty or governmental rule, regulation or order,
or any change therein or in the interpretation, administration or application
thereof (including the introduction of any new law, treaty or governmental rule,
regulation or order), or any determination of a court or governmental authority,
in each case that becomes effective after the date hereof, or compliance by such
Lender with any guideline, request or directive issued or made after the date
hereof by any central bank or other governmental or quasi-governmental authority
(whether or not having the force of law): (i) subjects such Lender (or its
applicable lending office) to any additional Tax (other than any Tax on the
overall net income of such Lender) with respect to this Agreement or any of the
other Credit Documents or any of its obligations hereunder or thereunder or any
payments to such Lender (or its applicable lending office) of principal,
interest, fees or any other amount payable hereunder; (ii) imposes, modifies or
holds applicable any reserve (including any marginal, emergency, supplemental,
special or other reserve), special deposit, compulsory loan, FDIC insurance or
similar requirement against assets held by, or deposits or other liabilities in
or for the account of, or advances or loans by, or other credit extended by, or
any other acquisition of funds by, any office of such Lender (other than any
such reserve or other requirements with respect to Eurodollar Rate Loans that
are reflected in the definition of Adjusted Eurodollar Rate or with respect to
Base Rate Loans that are included in the determination of the Prime Rate); or
(iii) imposes any other condition (other than with respect to a Tax matter) on
or affecting such Lender (or its applicable lending office) or its obligations
hereunder or the London interbank market; and the result of any of the foregoing
is to increase the cost to such Lender of agreeing to make, making or
maintaining Loans hereunder or to reduce any amount received or receivable by
such Lender (or its applicable lending office) with respect thereto; then, in
any such case, Company shall promptly pay to such Lender, upon receipt of the
statement referred to in the next sentence, such additional amount or amounts
(in the form of an increased rate of, or a different method of calculating,
interest or otherwise as such Lender in its sole discretion shall determine) as
may be necessary to compensate such Lender for any such increased cost or
reduction in amounts received or receivable hereunder; provided that Company
shall not be required to compensate a Lender pursuant to this Section for any
increased costs incurred or reductions suffered more than six months prior to
the date that such Lender notifies Company of the change in law giving rise to
such increased costs or reductions and of such Lender’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 six-month period referred
to above shall be extended to include the period of retroactive effect thereof).
Such Lender shall deliver to Company (with a copy to Administrative Agent) a
written statement, setting forth in reasonable detail the basis for calculating
the additional amounts owed to such Lender under this Section 2.19(a), which
statement shall be conclusive and binding upon all parties hereto absent
manifest error.

(b) Capital Adequacy Adjustment. In the event that any Lender (which term shall
include Issuing Bank for purposes of this Section 2.19(b)) shall have determined
that the adoption, effectiveness, phase-in or applicability after the Closing
Date of any law, rule or regulation (or any provision thereof) regarding capital
adequacy, or any change therein or in the interpretation or administration
thereof by any Governmental Authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by any Lender
(or its applicable lending office) with any guideline, request or directive
regarding capital adequacy (whether or not having the force of law) of any such
Governmental Authority, central bank or comparable agency, has or would have the
effect of reducing the rate of return on the capital of such Lender or any
corporation controlling such Lender as a consequence of, or with reference to,
such Lender’s Loans or Revolving Commitments or Letters of Credit or Hedge
Letters of Credit, or participations therein or other obligations hereunder with
respect to the Loans or the Letters of Credit or Hedge Letters of Credit to a
level below that which such Lender or such controlling corporation could have
achieved but for such adoption, effectiveness, phase-in, applicability, change
or compliance (taking into consideration the policies of such Lender or such
controlling corporation with regard to capital adequacy), then from time to
time, within five Business Days after receipt by Company from such Lender of the
statement referred to in the next sentence, Company shall pay to such Lender
such additional amount or amounts as will compensate such Lender or such
controlling corporation on an after-tax basis for such reduction. Such Lender
shall deliver to Company (with a copy to Administrative Agent) a written
statement, setting forth in reasonable detail the basis for calculating the
additional amounts owed to Lender under this Section 2.19(b), which statement
shall be conclusive and binding upon all parties hereto absent manifest error.

2.20 Taxes; Withholding, etc.

(a) Payments to Be Free and Clear. All sums payable by any Credit Party
hereunder and under the other Credit Documents shall (except to the extent
required by law) be paid free and clear of, and without any deduction or
withholding on account of, any Tax (other than a Tax on the overall net income
of any Lender) imposed, levied, collected, withheld or assessed by or within the
United States of America or any political subdivision in or of the United States
of America or any other jurisdiction from or to which a payment is made by or on
behalf of any Credit Party or by any federation or organization of which the
United States of America or any jurisdiction is a member at the time of payment
(“Indemnified Taxes”).

(b) Withholding of Taxes. If any Credit Party or any other Person is required by
law to make any deduction or withholding on account of any Indemnified Taxes
from any sum paid or payable by any Credit Party to Administrative Agent or any
Lender (which term shall include Issuing Bank for purposes of this
Section 2.20(b)) under any of the Credit Documents: (i) Company shall notify
Administrative Agent of any such requirement or any change in any such
requirement as soon as Company becomes aware of it; (ii) Company shall pay any
Indemnified Taxes before the date on which penalties attach thereto, such
payment to be made (if the liability to pay is imposed on any Credit Party) for
its own account or (if that liability is imposed on Administrative Agent or such
Lender, as the case may be) on behalf of and in the name of Administrative Agent
or such Lender; (iii) the sum payable by such Credit Party in respect of which
the relevant deduction, withholding or payment of Indemnified Taxes is required
shall be increased to the extent necessary to ensure that, after the making of
that deduction, withholding or payment, Administrative Agent or such Lender, as
the case may be, receives on the due date a net sum equal to what it would have
received had no such deduction, withholding or payment been required or made;
and (iv) within thirty days after paying any sum from which it is required by
law to make any deduction or withholding of Indemnified Taxes, and within thirty
days after the due date of payment of any Indemnified Taxes which it is required
by clause (ii) above to pay, Company shall deliver to Administrative Agent
evidence satisfactory to the other affected parties of such deduction,
withholding or payment and of the remittance thereof to the relevant taxing or
other authority; provided, no such additional amount shall be required to be
paid to any Lender under clause (iii) above except to the extent that any change
after the date hereof (in the case of each Lender listed on the signature pages
hereof on the Closing Date) or after the effective date of the Assignment
Agreement pursuant to which such Lender became a Lender (in the case of each
other Lender) in any such requirement for a deduction, withholding or payment as
is mentioned therein shall result in an increase in the rate of such deduction,
withholding or payment from that in effect at the date hereof or at the date of
such Assignment Agreement, as the case may be, in respect of payments to such
Lender.

(c) Treatment of Certain Refunds. If the Administrative Agent, a Lender or the
Issuing Bank determines, in its sole judgment, that it has received a refund of
any Taxes as to which it has been indemnified by Company or with respect to
which Company has paid additional amounts pursuant to this Section 2.20, it
shall pay to Company an amount equal to such refund (but only to the extent of
indemnity payments made, or additional amounts paid, by Company under this
Section 2.20 with respect to the Taxes giving rise to such refund), net of all
out-of-pocket expenses of the Administrative Agent, such Lender or the Issuing
Bank, 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
Company, upon the request of the Administrative Agent, such Lender or the
Issuing Bank, agrees to repay the amount paid over to Company (plus any
penalties, interest or other charges imposed by the relevant Governmental
Authority) to the Administrative Agent, such Lender or the Issuing Bank in the
event the Administrative Agent, such Lender or the Issuing Bank is required to
repay such refund to such Governmental Authority. This paragraph shall not be
construed to require the Administrative Agent, any Lender or the Issuing Bank to
make available its tax returns (or any other information relating to its taxes
that it deems confidential) to Company or any other Person.

(d) Evidence of Exemption From Withholding Tax. Any Lender that is entitled to
an exemption from or reduction of withholding tax under the law of the
jurisdiction in which the relevant Credit Party is resident for tax purposes, or
any treaty to which such jurisdiction is a party, with respect to payments
hereunder or under any Loan Document shall deliver to such Credit Party (with a
copy to the Administrative Agent), at the time or times prescribed by applicable
law and reasonably requested by such Credit Party or the Administrative Agent,
such properly completed and executed documentation prescribed by applicable law
as will permit such payments to be made without withholding or at a reduced rate
of withholding. In addition, any Lender, if requested by Company or the
Administrative Agent, shall deliver such other documentation prescribed by
applicable law and reasonably requested by Company or the Administrative Agent
to determine whether or not such Lender is subject to backup withholding or
information reporting requirements. Without limiting any of the foregoing, each
Lender that is not a United States Person (as such term is defined in
Section 7701(a)(30) of the Internal Revenue Code) for U.S. federal income tax
purposes (a “Non-US Lender”) shall deliver to Administrative Agent for
transmission to Company, on or prior to the Closing Date (in the case of each
Lender listed on the signature pages hereof on the Closing Date) or on or prior
to the date of the Assignment Agreement pursuant to which it becomes a Lender
(in the case of each other Lender), and at such other times as may be necessary
in the determination of Company or Administrative Agent (each in the reasonable
exercise of its discretion), (i) two original copies of Internal Revenue Service
Form W-8BEN (claiming benefits under an applicable treaty) or W-8ECI (or any
successor forms), properly completed and duly executed by such Lender, and such
other documentation required under the Internal Revenue Code and reasonably
requested by Company to establish that such Lender is not subject to deduction
or withholding of United States federal income tax with respect to any payments
to such Lender of principal, interest, fees or other amounts payable under any
of the Credit Documents, or (ii) if such Lender is not a “bank” or other Person
described in Section 881(c)(3) of the Internal Revenue Code and cannot deliver
Internal Revenue Service Forms W-8BEN or W-8ECI pursuant to clause (i) above, a
Certificate re Non-Bank Status together with two original copies of Internal
Revenue Service Form W-8BEN (or any successor form), properly completed and duly
executed by such Lender, and such other documentation required under the
Internal Revenue Code and reasonably requested by Company to establish that such
Lender is not subject to deduction or withholding of United States federal
income tax with respect to any payments to such Lender of interest payable under
any of the Credit Documents. Each Lender required to deliver any forms,
certificates or other evidence with respect to United States federal income tax
withholding matters pursuant to this Section 2.20(d) hereby agrees, from time to
time after the initial delivery by such Lender of such forms, certificates or
other evidence, whenever a lapse in time or change in circumstances renders such
forms, certificates or other evidence obsolete or inaccurate in any material
respect, that such Lender shall promptly deliver to Administrative Agent for
transmission to Company two new original copies of Internal Revenue Service Form
W-8BEN or W-8ECI, or a Certificate re Non-Bank Status and two original copies of
Internal Revenue Service Form W-8BEN (or any successor form), as the case may
be, properly completed and duly executed by such Lender, and such other
documentation required under the Internal Revenue Code and reasonably requested
by Company to confirm or establish that such Lender is not subject to deduction
or withholding of United States federal income tax with respect to payments to
such Lender under the Credit Documents, or notify Administrative Agent and
Company of its inability to deliver any such forms, certificates or other
evidence. Company shall not be required to pay any additional amount to any
Non-US Lender in respect of Indemnified Taxes under Section 2.20(b) if such
Lender shall have failed (1) to deliver the forms, certificates or other
evidence referred to in the second sentence of this Section 2.20(d), or (2) to
notify Administrative Agent and Company of its inability to deliver any such
forms, certificates or other evidence, as the case may be; provided, if such
Lender shall have satisfied the requirements of the first sentence of this
Section 2.20(d) on the Closing Date or on the date of the Assignment Agreement
pursuant to which it became a Lender, as applicable, nothing in this last
sentence of Section 2.20(d) shall relieve Company of its obligation to pay any
additional amounts in respect of Indemnified Taxes pursuant this Section 2.20 in
the event that, as a result of any change in any applicable law, treaty or
governmental rule, regulation or order, or any change in the interpretation,
administration or application thereof, such Lender is no longer properly
entitled to deliver forms, certificates or other evidence at a subsequent date
establishing the fact that such Lender is not subject to withholding as
described herein.

(e) To the extent required by any applicable law, the Administrative Agent may
withhold from any interest payment to any Lender an amount equivalent to any
applicable withholding tax. If any governmental authority asserts a claim that
the Administrative Agent did not properly withhold Tax from amounts paid to or
for the account of any Lender because the appropriate form was not delivered or
was not properly executed or because such Lender failed to notify the
Administrative Agent of a change in circumstance which rendered the exemption
from, or reduction of, withholding tax ineffective or for any other reason, such
Lender shall indemnify the Administrative Agent fully for all amounts paid,
directly or indirectly, by the Administrative Agent as Tax or otherwise,
including any penalties or interest and together with all expenses (including
legal expenses, allocated internal costs and out-of-pocket expenses) incurred.

2.21 Obligation to Mitigate. Each Lender (which term shall include Issuing Bank
for purposes of this Section 2.21) agrees that, as promptly as practicable after
the officer of such Lender responsible for administering its Loans or Letters of
Credit or Hedge Letters of Credit, as the case may be, becomes aware of the
occurrence of an event or the existence of a condition that would cause such
Lender to become an Affected Lender or that would entitle such Lender to receive
payments under Section 2.18, 2.19 or 2.20, it will, to the extent not
inconsistent with the internal policies of such Lender and any applicable legal
or regulatory restrictions, use reasonable efforts to (a) make, issue, fund or
maintain its Credit Extensions, including any Affected Loans, through another
office of such Lender, or (b) take such other measures as such Lender may deem
reasonable, if as a result thereof the circumstances which would cause such
Lender to be an Affected Lender would cease to exist or the additional amounts
which would otherwise be required to be paid to such Lender pursuant to
Section 2.18, 2.19 or 2.20 would be materially reduced and if, as determined by
such Lender in its sole discretion, the making, issuing, funding or maintaining
of such Revolving Commitments, Loans or Letters of Credit or Hedge Letters of
Credit through such other office or in accordance with such other measures, as
the case may be, would not otherwise adversely affect such Revolving
Commitments, Loans or Letters of Credit or Hedge Letters of Credit or the
interests of such Lender; provided, such Lender will not be obligated to utilize
such other office pursuant to this Section 2.21 unless Company agrees to pay all
incremental expenses incurred by such Lender as a result of utilizing such other
office as described in clause (i) above. A certificate as to the amount of any
such expenses payable by Company pursuant to this Section 2.21 (setting forth in
reasonable detail the basis for requesting such amount) submitted by such Lender
to Company (with a copy to Administrative Agent) shall be conclusive absent
manifest error.

2.22 Defaulting Lenders. Anything contained herein to the contrary
notwithstanding, in the event that any Lender, other than at the direction or
request of any regulatory agency or authority, defaults (a “Defaulting Lender”)
in its obligation to fund (a “Funding Default”) any Revolving Loan or Hedge L/C
Loan or its portion of any unreimbursed payment or participation obligations
under Section 2.2(b)(iv), 2.4(d), 2.4(e) or 2.4(i) (in each case, a “Defaulted
Loan”), then (a) during any Default Period with respect to such Defaulting
Lender, such Defaulting Lender shall be deemed not to be a “Lender” for purposes
of voting on any matters (including the granting of any consents or waivers)
with respect to any of the Credit Documents; (b) to the extent permitted by
applicable law, until such time as the Default Excess with respect to such
Defaulting Lender shall have been reduced to zero, (i) any voluntary prepayment
of the Revolving Loans shall, if Company so directs at the time of making such
voluntary prepayment, be applied to the Revolving Loans of other Lenders as if
such Defaulting Lender had no Revolving Loans outstanding and the Revolving
Exposure of such Defaulting Lender were zero, and (ii) any mandatory prepayment
of the Revolving Loans shall, if Company so directs at the time of making such
mandatory prepayment, be applied to the Revolving Loans of other Lenders (but
not to the Revolving Loans of such Defaulting Lender) as if such Defaulting
Lender had funded all Defaulted Loans of such Defaulting Lender, it being
understood and agreed that Company shall be entitled to retain any portion of
any mandatory prepayment of the Revolving Loans that is not paid to such
Defaulting Lender solely as a result of the operation of the provisions of this
clause (b); (c) such Defaulting Lender’s Revolving Commitment and outstanding
Revolving Loans and such Defaulting Lender’s Pro Rata Share of the Letter of
Credit Usage shall be excluded for purposes of calculating the Revolving
Commitment fee payable to Lenders in respect of any day during any Default
Period with respect to such Defaulting Lender, and such Defaulting Lender shall
not be entitled to receive any Revolving Commitment fee pursuant to Section 2.11
with respect to such Defaulting Lender’s Revolving Commitment in respect of any
Default Period with respect to such Defaulting Lender; and (d) the Total
Utilization of Revolving Commitments as at any date of determination shall be
calculated as if such Defaulting Lender had funded all Defaulted Loans of such
Defaulting Lender. No Revolving Commitment of any Lender shall be increased or
otherwise affected, and, except as otherwise expressly provided in this
Section 2.22, performance by Company of its obligations hereunder and the other
Credit Documents shall not be excused or otherwise modified as a result of any
Funding Default or the operation of this Section 2.22. The rights and remedies
against a Defaulting Lender under this Section 2.22 are in addition to other
rights and remedies which Company may have against such Defaulting Lender with
respect to any Funding Default and which Administrative Agent or any Lender may
have against such Defaulting Lender with respect to any Funding Default.

2.23 Removal or Replacement of a Lender. Anything contained herein to the
contrary notwithstanding, in the event that: (a)(i) any Lender (an
“Increased-Cost Lender”) shall give notice to Company that such Lender is an
Affected Lender or that such Lender is entitled to receive payments under
Section 2.18, 2.19 or 2.20, (ii) the circumstances which have caused such Lender
to be an Affected Lender or which entitle such Lender to receive such payments
shall remain in effect, and (iii) such Lender shall fail to withdraw such notice
within five Business Days after Company’s request for such withdrawal or (b)(i)
any Lender shall become a Defaulting Lender, (ii) the Default Period for such
Defaulting Lender shall remain in effect, and (iii) such Defaulting Lender shall
fail to cure the default as a result of which it has become a Defaulting Lender
within five Business Days after Company’s request that it cure such default;
then, with respect to each such Increased-Cost Lender or Defaulting Lender (the
“Terminated Lender”), Company may, by giving written notice to Administrative
Agent and any Terminated Lender of its election to do so, elect to cause such
Terminated Lender (and such Terminated Lender hereby irrevocably agrees) to
assign its outstanding Loans, its Revolving Commitments, and its Hedge L/C
Commitment, if any, in full to one or more Eligible Assignees (each a
“Replacement Lender”) in accordance with the provisions of Section 10.6 and
Terminated Lender shall pay any fees payable thereunder in connection with such
assignment; provided, (1) on the date of such assignment, the Replacement Lender
shall pay to Terminated Lender an amount equal to the sum of (A) an amount equal
to the principal of, and all accrued interest on, all outstanding Loans of the
Terminated Lender, (B) an amount equal to all unreimbursed drawings that have
been funded by such Terminated Lender, together with all then unpaid interest
with respect thereto at such time and (C) an amount equal to all accrued, but
theretofore unpaid fees owing to such Terminated Lender pursuant to Section 2.11
and (2) on the date of such assignment, Company shall pay any amounts payable to
such Terminated Lender pursuant to Section 2.18(c), 2.19 or 2.20; or otherwise
as if it were a prepayment; provided, Company may not make such election with
respect to any Terminated Lender that is also an Issuing Bank unless, prior to
the effectiveness of such election, Company shall have caused each outstanding
Letter of Credit or Hedge Letter of Credit, as applicable, issued thereby to be
cancelled. Upon the prepayment of all amounts owing to any Terminated Lender and
the termination of such Terminated Lender’s Revolving Commitments, if any, such
Terminated Lender shall no longer constitute a “Lender” for purposes hereof;
provided, any rights of such Terminated Lender to indemnification hereunder
shall survive as to such Terminated Lender.

SECTION 3 CONDITIONS PRECEDENT

3.1 Closing Date. The obligation of any Lender to make a Credit Extension on the
Closing Date is subject to the satisfaction, or waiver in accordance with
Section 10.5, of the following conditions on or before the Closing Date:

(a) Credit Documents. Administrative Agent shall have received sufficient copies
of each Credit Document originally executed and delivered by each applicable
Credit Party for each Lender.

(b) Organizational Documents; Incumbency. Administrative Agent shall have
received (i) sufficient copies of each Organizational Document executed and
delivered by each Credit Party, as applicable, and, to the extent applicable,
certified as of a recent date by the appropriate governmental official, for each
Lender, each dated the Closing Date or a recent date prior thereto;
(ii) signature and incumbency certificates of the officers of such Person
executing the Credit Documents to which it is a party; (iii) resolutions of the
Board of Directors or similar governing body of each Credit Party approving and
authorizing the execution, delivery and performance of this Agreement and the
other Credit Documents and the Related Agreements to which it is a party or by
which it or its assets may be bound as of the Closing Date, certified as of the
Closing Date by its secretary or an assistant secretary as being in full force
and effect without modification or amendment; and (iv) a good standing
certificate from the applicable Governmental Authority of each Credit Party’s
jurisdiction of incorporation, organization or formation and in each
jurisdiction in which it is qualified as a foreign corporation or other entity
to do business, each dated a recent date prior to the Closing Date.

(c) Organizational and Capital Structure. The organizational structure and
capital structure of Company and its Subsidiaries, both before and after giving
effect to the Acquisition, shall be as set forth on Schedules 4.1 and 4.2.

(d) Capitalization of Company. On or before the Closing Date, the Company shall
have received the gross proceeds from equity contributions or Qualified Junior
Debt in an aggregate amount not less than $34,000,000.

(e) Consummation of Transactions Contemplated by Related Agreements.

(i) (1) All conditions to the transactions contemplated by each of the Related
Agreements shall have been satisfied or the fulfillment of any such conditions
shall have been waived with the consent of Administrative Agent and (2) the
Acquisition shall have become effective in accordance with the terms of the
Acquisition Agreement.

(ii) Administrative Agent shall have received a fully executed or conformed copy
of each Related Agreement and any documents executed in connection therewith.
Each Related Agreement shall be in full force and effect, shall include terms
and provisions reasonably satisfactory to Administrative Agent and no provision
thereof shall have been modified or waived in any respect determined by
Administrative Agent to be material, in each case without the consent of
Administrative Agent.

(f) Existing Credit Agreement. On the Closing Date, the administrative agent and
the lenders under the Existing Credit Agreement shall have assigned all of their
rights under the Credit Documents (as defined in the Existing Credit Agreement)
to the Administrative Agent and the Lenders in a manner reasonably satisfactory
to the Administrative Agent.

(g) Transaction Costs. On or prior to the Closing Date, Company shall have
delivered to Administrative Agent Company’s reasonable best estimate of the
Transactions Costs (other than fees payable to any Agent) and shall have paid
all Transaction Costs payable in connection with the Credit Documents.

(h) Governmental Authorizations and Consents. Each Credit Party shall have
obtained all Governmental Authorizations (other than the filing of UCC financing
statements and the Mortgages) and all consents of other Persons, in each case
that are necessary in connection with the transactions contemplated by the
Credit Documents and the Related Agreements and each of the foregoing shall be
in full force and effect and in form and substance reasonably satisfactory to
Administrative Agent. All applicable waiting periods shall have expired without
any action being taken or threatened by any competent authority which would
restrain, prevent or otherwise impose adverse conditions on the transactions
contemplated by the Credit Documents or the Related Agreements or the financing
thereof and no action, request for stay, petition for review or rehearing,
reconsideration, or appeal with respect to any of the foregoing shall be
pending, and the time for any applicable agency to take action to set aside its
consent on its own motion shall have expired.

(i) Real Estate Assets; Hydrocarbon Interests. In order to create in favor of
Collateral Trustee, for the benefit of Secured Parties, a valid and, subject to
any filing and/or recording referred to herein, an Acceptable Security Interest
in certain Real Estate Assets and certain Hydrocarbon Interests, Collateral
Trustee shall have received from Company and each applicable Guarantor:

(i) fully executed and notarized Mortgage Supplements for each of the Existing
Mortgages, in proper form for recording in all appropriate places in all
applicable jurisdictions, encumbering each Real Estate Asset listed in
Schedule 3.1(i) (each, a “Closing Date Mortgaged Property’’) and each
Hydrocarbon Interest listed on Schedule 3.1(i), which Hydrocarbon Interests
shall represent no less than 80% of the value of Proven Reserves of Company and
the Guarantors as of the Closing Date (as valued in the Borrowing Base);

(ii) (A) an opinion of counsel (which counsel shall be reasonably satisfactory
to Administrative Agent) in each state in which a Closing Date Mortgaged
Property is located with respect to the enforceability of the Mortgages recorded
in such, as supplemented by the Mortgage Supplements and recorded in such state
and such other matters as Administrative Agent may reasonably request, in each
case in form and substance reasonably satisfactory to Administrative Agent,
(B) current updates, addressed to the Administrative Agent, of title opinions
previously delivered to Company or its predecessors with respect to at least 43%
of the Borrowing Base value of the Company’s and the Guarantors’ Proven
Reserves; and (C) lien searches from all counties in Michigan, Ohio,
Pennsylvania and New York in which the Company and/or any Guarantor own Real
Estate Assets, in form and substance reasonably satisfactory to Administrative
Agent.

(iii) [Reserved];

(iv) evidence satisfactory to Administrative Agent that Credit Party has paid
all recording and stamp taxes (including mortgage recording and intangible
taxes) payable in connection with recording the Mortgages for each Closing Date
Mortgaged Property in the appropriate real estate records; and

(v) evidence of flood insurance with respect to each Flood Hazard Property that
is located in a community that participates in the National Flood Insurance
Program, in each case in compliance with any applicable regulations of the Board
of Governors of the Federal Reserve System, in form and substance reasonably
satisfactory to Administrative Agent.

(j) Personal Property Collateral. In order to create in favor of Collateral
Trustee, for the benefit of Secured Parties, an Acceptable Security Interest in
the personal property Collateral, Collateral Trustee shall have received:

(i) evidence satisfactory to Collateral Trustee of the compliance by each Credit
Party with its obligations under the Pledge and Security Agreement and the other
Collateral Documents (including, without limitation, their obligations to file
UCC financing statements, deliver originals of certificated securities,
instruments and chattel paper, and execute and deliver control agreements with
respect to deposit and/or securities accounts as provided therein);

(ii) the results of a recent search, by a Person satisfactory to Administrative
Agent, of all effective UCC financing statements (or equivalent filings) made
with respect to any personal or mixed property of any Credit Party in the
jurisdictions requested by Administrative Agent, together with copies of all
such filings disclosed by such search, to the extent reasonably requested by
Administrative Agent, and (B) UCC termination statements (or similar documents)
duly authorized by all applicable Persons for filing in all applicable
jurisdictions as may be necessary to terminate any effective UCC financing
statements (or equivalent filings) disclosed in such search (other than any such
financing statements in respect of Permitted Liens);

(iii) opinions of counsel with respect to the creation and perfection of the
security interests in favor of Collateral Trustee in such Collateral and such
other matters governed by the laws of each jurisdiction in which any Credit
Party or any such personal property Collateral is located as Administrative
Agent may reasonably request, in each case in form and substance reasonably
satisfactory to Administrative Agent; and

(iv) evidence that each Credit Party shall have taken or caused to be taken any
other action, executed and delivered or caused to be executed and delivered any
other agreement, document and instrument and made or caused to be made any other
filing and recording (other than as set forth herein) reasonably required by
Administrative Agent.

(k) Environmental Reports. Administrative Agent shall have received the
Environmental Report, the Environmental Report shall be addressed to the
Administrative Agent and the Lenders, or the Administrative Agent shall have
received a reliance letter authorizing reliance by Administrative Agent and the
Lenders on the Environmental Report, and the scope and findings of the
Environmental Report shall be reasonably satisfactory to the Administrative
Agent.

(l) Financial Statements. Lenders shall have received from Company (i) the
Historical Financial Statements, and (ii) pro forma consolidated balance sheets
of Company and its Subsidiaries as at the Closing Date, and reflecting the
consummation of the Acquisition, the transactions contemplated by the Swap
Agreements, the related financings and the other transactions contemplated by
the Credit Documents to occur on or prior to the Closing Date, which pro forma
financial statements shall be in form and substance satisfactory to
Administrative Agent.

(m) Evidence of Insurance. Administrative Agent shall have received a
certificate from Company’s insurance broker or other evidence satisfactory to it
that all insurance required to be maintained pursuant to Section 5.5 is in full
force and effect, together with endorsements naming the Collateral Trustee, for
the benefit of the Secured Parties, as additional insured and loss payee
thereunder to the extent required under Section 5.5.

(n) Opinions of Counsel to Credit Parties. Lenders and their respective counsel
shall have received originally executed copies of the favorable written opinions
of each of (i) Haynes & Boone, LLP, New York and Texas counsel to the Company,
(ii) Bricker & Eckler LLP, Ohio counsel, (iii) Dickinson Wright PLLC, Michigan
counsel, and (iv) Culbertson, Weiss, Schetroma and Schug, P.C., Pennsylvania
counsel, each covering, among other things and as applicable, the matters
referred to in Section 3.1(i)(ii) and 3.1(j)(iii), and such other matters as
Administrative Agent may reasonably request, dated as of the Closing Date and
otherwise in form and substance reasonably satisfactory to Administrative Agent
(and each Credit Party hereby instructs such counsel to deliver such opinions to
Agents and Lenders).

(o) Fees. Company shall have paid to Administrative Agent the fees payable on
the Closing Date referred to in Section 2.11(e).

(p) Solvency Certificate. On the Closing Date, Administrative Agent shall have
received a Solvency Certificate from the chief financial officer of Company
dated the Closing Date, with appropriate attachments and demonstrating that
after giving effect to the consummation of the Acquisition, Company and its
Subsidiaries are and will be Solvent.

(q) Closing Date Certificate. Company shall have delivered to Administrative
Agent an originally executed Closing Date Certificate, together with all
attachments thereto.

(r) J. Aron Swap. The Administrative Agent shall be reasonably satisfied with
the terms and conditions of the J. Aron Swap.

(s) No Litigation. There shall not exist any action, suit, investigation,
litigation or proceeding, pending or threatened in any court or before any
arbitrator or Governmental Authority that, in the reasonable opinion of
Administrative Agent, singly or in the aggregate, materially impairs the
Acquisition, the financing thereof or any of the other transactions contemplated
by the Credit Documents or the Related Agreements, or that could reasonably be
expected to have a Material Adverse Effect.

(t) Completion of Proceedings. All partnership, corporate and other proceedings
taken or to be taken in connection with the transactions contemplated hereby and
all documents incidental thereto not previously found acceptable by
Administrative Agent and its counsel shall be satisfactory in form and substance
to Administrative Agent and such counsel, and Administrative Agent and such
counsel shall have received all such counterpart originals or certified copies
of such documents as Administrative Agent may reasonably request.

(u) Other Documents. The Administrative Agent shall have received such other
documents, governmental certificates, agreements and lien searches as the
Administrative Agent or any Lender may reasonably request.

Each Lender, by delivering its signature page to this Agreement and funding a
Loan on the Closing Date, shall be deemed to have acknowledged receipt of, and
consented to and approved, each Credit Document and each other document required
to be approved by any Agent, Requisite Lenders or Lenders, as applicable on the
Closing Date.

3.2 Conditions to Each Credit Extension.

(a) Conditions Precedent. The obligation of each Lender to make any Loan, or
Issuing Bank to issue any Letter of Credit or Hedge Letter of Credit, on any
Credit Date, including the Closing Date, are subject to the satisfaction, or
waiver in accordance with Section 10.5, of the following conditions precedent:

(i) Administrative Agent shall have received a fully executed and delivered
Funding Notice or Issuance Notice, as the case may be;

(ii) after making the Credit Extensions requested on such Credit Date, (A) the
Total Utilization of Revolving Commitments shall not exceed the lesser of
aggregate Revolving Commitments then in effect and the Borrowing Base then in
effect and (B) the Total Utilization of Hedge L/C Commitments shall not exceed
the aggregate Hedge L/C Commitments then in effect;

(iii) as of such Credit Date, the representations and warranties of the Credit
Parties contained herein and in the other Credit Documents shall be true and
correct in all material respects on and as of that Credit Date to the same
extent as though made on and as of that date, except to the extent such
representations and warranties specifically relate to an earlier date, in which
case such representations and warranties shall have been true and correct in all
material respects on and as of such earlier date;

(iv) as of such Credit Date, no event shall have occurred and be continuing or
would result from the consummation of the applicable Credit Extension that would
constitute an Event of Default or a Default; and

(v) on or before the date of issuance of any Letter of Credit or Hedge Letter of
Credit, Administrative Agent shall have received all other information required
by the applicable Issuance Notice, and such other documents or information as
Issuing Bank may reasonably require in connection with the issuance of such
Letter of Credit or Hedge Letter of Credit.

Administrative Agent or Requisite Lenders shall be entitled, but not obligated
to, request and receive, prior to the making of any Credit Extension, additional
information reasonably satisfactory to the requesting party confirming the
satisfaction of any of the foregoing if, in the good faith judgment of such
Administrative Agent or each such Requisite Lender such request is warranted
under the circumstances.

(b) Notices. Any Notice shall be executed by an Authorized Officer in a writing
delivered to Administrative Agent. In lieu of delivering a Notice, Company may
give Administrative Agent telephonic notice by the required time of any proposed
borrowing, conversion/continuation or issuance of a Letter of Credit or the
Hedge Letter of Credit, as the case may be; provided each such notice shall be
promptly confirmed in writing by delivery of the applicable Notice to
Administrative Agent on or before the applicable date of borrowing,
continuation/conversion or issuance. Neither Administrative Agent nor any Lender
shall incur any liability to Company in acting upon any telephonic notice
referred to above that Administrative Agent believes in good faith to have been
given by a duly authorized officer or other person authorized on behalf of
Company or for otherwise acting in good faith.

SECTION 4 REPRESENTATIONS AND WARRANTIES

In order to induce Lenders and Issuing Bank to enter into this Agreement and to
make each Credit Extension to be made thereby, each Credit Party represents and
warrants to each Lender and Issuing Bank, on the Closing Date and on each Credit
Date, that the following statements are true and correct (it being understood
and agreed that the representations and warranties made on the Closing Date are
deemed to be made concurrently with the consummation of the Acquisition and
other transactions contemplated by Related Agreements):

4.1 Organization; Requisite Power and Authority; Qualification. Each of Company
and its Subsidiaries (a) is duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization as identified in
Schedule 4.1, (b) has all requisite power and authority to own and operate its
properties, to carry on its business as now conducted and as proposed to be
conducted, to enter into the Credit Documents to which it is a party and to
carry out the transactions contemplated thereby, and (c) is qualified to do
business and in good standing in every jurisdiction where its assets are located
and wherever necessary to carry out its business and operations, except in
jurisdictions where the failure to be so qualified or in good standing has not
had, and could not be reasonably expected to have, a Material Adverse Effect. As
of the Closing Date, the principal place of business, tax identification number,
and state organizational number of the Company and each of its Restricted
Subsidiaries is as set forth on Schedule 4.1.

4.2 Capital Stock and Ownership. The Capital Stock of each of Company and its
Subsidiaries has been duly authorized and validly issued and is fully paid and
non-assessable. As of the Closing Date, except as set forth on Schedule 4.2,
there is no existing option, warrant, call, right, commitment or other agreement
to which Company or any of its Subsidiaries is a party requiring, and there is
no membership interest or other Capital Stock of Company or any of its
Subsidiaries outstanding which upon conversion or exchange would require, the
issuance by Company or any of its Subsidiaries of any additional membership
interests or other Capital Stock of Company or any of its Subsidiaries or other
Securities convertible into, exchangeable for or evidencing the right to
subscribe for or purchase, a membership interest or other Capital Stock of
Company or any of its Subsidiaries. Schedule 4.2 correctly sets forth the
ownership interest of Company and each of its Subsidiaries in their respective
Subsidiaries as of the Closing Date both before and after giving effect to the
Acquisition.

4.3 Due Authorization. The execution, delivery and performance of the Credit
Documents have been duly authorized by all necessary action on the part of each
Credit Party that is a party thereto.

4.4 No Conflict. The execution, delivery and performance by Credit Parties of
the Credit Documents to which they are parties and the consummation of the
transactions contemplated by the Credit Documents do not and will not
(a) violate any provision of any law or any governmental rule or regulation
applicable to Company or any of its Subsidiaries, any of the Organizational
Documents of Company or any of its Subsidiaries, or any order, judgment or
decree of any court or other agency of government binding on Company or any of
its Subsidiaries; (b) conflict with, result in a breach of or constitute (with
due notice or lapse of time or both) a default under any Contractual Obligation
of Company or any of its Subsidiaries, except to the extent such conflict or
breach could not reasonably be expected to have a Material Adverse Effect;
(c) result in or require the creation or imposition of any Lien upon any of the
properties or assets of Company or any of its Subsidiaries (other than any Liens
created under any of the Credit Documents in favor of Collateral Agent, on
behalf of Secured Parties); or (d) require any approval of stockholders, members
or partners or any approval or consent of any Person under any Contractual
Obligation of Company or any of its Subsidiaries, except for such approvals or
consents which will be obtained on or before the Closing Date and disclosed in
writing to Lenders and except for any approval, the failure of which to obtain
could not reasonably be expected to have a Material Adverse Effect.

4.5 Governmental Consents. The execution, delivery and performance by Credit
Parties of the Credit Documents to which they are parties and the consummation
of the transactions contemplated by the Credit Documents do not and will not
require any registration with, consent or approval of, or notice to, or other
action to, with or by, any Governmental Authority, except for filings and
recordings with respect to the Collateral to be made, or otherwise delivered to
Collateral Trustee for filing and/or recordation, as of and after the Closing
Date, and routine filings required to be made in the ordinary course of business
pursuant to the requirements of applicable law.

4.6 Binding Obligation. Each Credit Document has been duly executed and
delivered by each Credit Party that is a party thereto and is the legally valid
and binding obligation of such Credit Party, enforceable against such Credit
Party in accordance with its respective terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws relating to
or limiting creditors’ rights generally or by equitable principles relating to
enforceability.

4.7 Historical Financial Statements. The Historical Financial Statements were
prepared in conformity with GAAP and fairly present, in all material respects,
the financial position, on a consolidated basis, of Company and its Subsidiaries
as at the respective dates thereof and the results of operations and cash flows,
on a consolidated basis, of the entities described therein for each of the
periods then ended, subject, in the case of any such unaudited financial
statements, to changes resulting from audit and normal year-end adjustments. As
of the Closing Date, neither Company nor any of its Subsidiaries has any
contingent liability or liability for taxes, long-term lease or unusual forward
or long-term commitment that is not reflected in the Historical Financial
Statements or the notes thereto and which in any such case is material in
relation to the business, operations, properties, assets, condition (financial
or otherwise) or prospects of Company and any of its Subsidiaries taken as a
whole.

4.8 [Reserved].

4.9 No Material Adverse Change. Since December 31, 2004, no event, circumstance
or change has occurred that has caused or evidences, either in any case or in
the aggregate, a Material Adverse Effect.

4.10 No Restricted Junior Payments. Since December 31, 2004, neither Company nor
any of its Restricted Subsidiaries has directly or indirectly declared, ordered,
paid or made, or set apart any sum or property for, any Restricted Junior
Payment or agreed to do so except as permitted pursuant to Section 6.5.

4.11 No Reserve Write-downs. From December 31, 2004 through the Closing Date,
Company has not reduced the volume of its reserves by more than 2%, except as
previously disclosed to the Administrative Agent prior to the Closing Date.

4.12 Adverse Proceedings, etc. There are no Adverse Proceedings, individually or
in the aggregate, that could reasonably be expected to have a Material Adverse
Effect. Neither Company nor any of its Subsidiaries (a) is in violation of any
applicable laws (including Environmental Laws) that, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect, or
(b) is subject to or in default with respect to any final judgments, writs,
injunctions, decrees, rules or regulations of any court or any federal, state,
municipal or other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, that, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect.

4.13 Payment of Taxes. Except as described on Schedule 4.13, and except as
otherwise permitted under Section 5.3, all tax returns and reports of Company
and its Subsidiaries required to be filed by any of them have been timely filed
(taking into account any extensions), and all taxes shown on such tax returns to
be due and payable and all material assessments, fees and other governmental
charges upon Company and its Subsidiaries and upon their respective properties,
assets, income, businesses and franchises which are due and payable have been
paid when due and payable. Company knows of no proposed tax assessment against
Company or any of its Subsidiaries which is not being actively contested by
Company or such Subsidiary in good faith and by appropriate proceedings;
provided, such reserves or other appropriate provisions, if any, as shall be
required in conformity with GAAP shall have been made or provided therefor.

4.14 Properties.

(a) Title. Each of Company and its Restricted Subsidiaries has (i) good,
sufficient and legal title to (in the case of fee interests in real property),
(ii) valid leasehold interests in (in the case of leasehold interests in real or
personal property), and (iii) good title to (in the case of all other personal
property), all of their respective properties and assets reflected in their
respective Historical Financial Statements referred to in Section 4.5 and in the
most recent financial statements delivered pursuant to Section 5.1, in each case
except for (a) assets disposed of since the date of such financial statements in
the ordinary course of business or as otherwise permitted under Section 6.9,
(b) Permitted Liens and (c) with respect to Oil and Gas Properties, such
imperfections of title which do not in the aggregate materially detract from the
value thereof to, or the use thereof in, the business of Company or any of the
Guarantors. All such properties and assets are free and clear of Liens except
Permitted Liens.

(b) Real Estate. As of the Closing Date, Schedule 4.14 contains a true, accurate
and complete list of (i) all Material Real Estate Assets, (ii) all leases,
subleases or assignments of leases (together with all amendments, modifications,
supplements, renewals or extensions of any thereof) affecting each Material Real
Estate Asset of any Credit Party, regardless of whether such Credit Party is the
landlord or tenant (whether directly or as an assignee or successor in interest)
under such lease, sublease or assignment and (iii) the working interest and net
revenue interest in each Hydrocarbon Interest of each Credit Party. Each
agreement listed in clause (ii) of the immediately preceding sentence is in full
force and effect and Company does not have knowledge of any default that has
occurred and is continuing thereunder, and each such agreement constitutes the
legally valid and binding obligation of each applicable Credit Party,
enforceable against such Credit Party in accordance with its terms, except as
enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws relating to or limiting creditors’ rights generally or by
equitable principles. As of the Closing Date, with respect to Hydrocarbon
Interests set forth on Schedule 4.14 constituting 80% of the total value of
Proven Reserves, each Credit Party has a net revenue interest no less than the
net revenue interest set forth on such Schedule for such Proven Reserves.

(c) Condition. The material personal Properties of the Company and its
Restricted Subsidiaries used or to be used in the continuing operations of the
Company and each of its Restricted Subsidiaries are in good repair, working
order and condition (ordinary wear and tear excepted). Since December 31, 2004,
neither the business nor the material Properties of the Company and each of the
Guarantors, taken as a whole, has been materially and adversely affected as a
result of any fire, explosion, earthquake, flood, drought, windstorm, accident,
strike or other labor disturbance, embargo, requisition or taking of Property or
cancellation of contracts, permits, or concessions by a Governmental Authority,
riot, activities of armed forces, or acts of God or of any public enemy.

4.15 Environmental Matters. Neither Company nor any of its Subsidiaries nor any
of their respective Facilities or operations are subject to any outstanding
written order, consent decree or settlement agreement with any Person relating
to any Environmental Law, any Environmental Claim, or any Hazardous Materials
Activity that, individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect. Neither Company nor any of its Subsidiaries has
received any letter or request for information under Section 104 of the
Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C.
§ 9604) or any comparable state law that relates to an actual or potential
Environmental Claim or other liability that, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect. There are and,
to each of Company’s and its Subsidiaries’ knowledge, have been, no conditions,
occurrences, or Hazardous Materials Activities at, on, under or adjacent to,
Facilities or Oil and Gas Properties or at any other real property currently or
previously owned, operated, or used by the Company, its Subsidiaries or, to any
of Company’s or its Subsidiaries’ knowledge, predecessors of the Company or its
Subsidiaries, which could reasonably be expected to form the basis of an
Environmental Claim against Company or any of its Subsidiaries that,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect. Neither Company nor any of its Subsidiaries nor, to any
of Company and its Subsidiaries’ knowledge, any predecessor of Company or any of
its Subsidiaries has filed any notice under any Environmental Law indicating
past or present treatment of Hazardous Materials at any Facility or Oil and Gas
Properties, and none of Company’s or any of its Subsidiaries’ operations
involves the generation, transportation, treatment or disposal of hazardous
waste, as defined under 40 C.F.R. Parts 260-270 or any state equivalent, except
where doing so could not reasonably be expected to have a Material Adverse
Effect. Compliance by Company and its Subsidiaries with all current or
reasonably foreseeable future requirements pursuant to or under Environmental
Laws could not be reasonably expected to have, individually or in the aggregate,
a Material Adverse Effect and no event or condition has occurred or is occurring
with respect to Company or any of its Subsidiaries relating to any Environmental
Law, any Release of Hazardous Materials, or any Hazardous Materials Activity
which individually or in the aggregate has had, or could reasonably be expected
to have, a Material Adverse Effect.

4.16 No Defaults. Neither Company nor any of its Subsidiaries is in default in
the performance, observance or fulfillment of any of the obligations, covenants
or conditions contained in any of its Contractual Obligations, and no condition
exists which, with the giving of notice or the lapse of time or both, could
constitute such a default, except where the consequences, direct or indirect, of
such default or defaults, if any, could not reasonably be expected to have a
Material Adverse Effect.

4.17 Material Contracts. Schedule 4.17 contains a true, correct and complete
list of all the Material Contracts in effect on the Closing Date, and except as
described thereon, all such Material Contracts are in full force and effect and
no defaults currently exist thereunder, except where the consequences, direct or
indirect, of such default or defaults, if any, could not reasonably be expected
to have a Material Adverse Effect.

4.18 Governmental Regulation. Neither Company nor any of its Subsidiaries is
subject to regulation under the Public Utility Holding Company Act of 1935, the
Federal Power Act or the Investment Company Act of 1940 or under any other
federal or state statute or regulation which may limit its ability to incur
Indebtedness or which may otherwise render all or any portion of the Obligations
unenforceable. Neither Company nor any of its Subsidiaries is a “registered
investment company” or a company “controlled” by a “registered investment
company” or a “principal underwriter” of a “registered investment company” as
such terms are defined in the Investment Company Act of 1940.

4.19 Margin Stock. Neither Company nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying any Margin Stock. No part of
the proceeds of the Loans made to such Credit Party will be used to purchase or
carry any such margin stock or to extend credit to others for the purpose of
purchasing or carrying any such margin stock or for any purpose that violates,
or is inconsistent with, the provisions of Regulation T, U or X of said Board of
Governors.

4.20 Employee Matters. Neither Company nor any of its Subsidiaries is engaged in
any unfair labor practice that could reasonably be expected to have a Material
Adverse Effect. There is (a) no unfair labor practice complaint pending against
Company or any of its Subsidiaries, or to the best knowledge of Company,
threatened against any of them before the National Labor Relations Board and no
grievance or arbitration proceeding arising out of or under any collective
bargaining agreement that is so pending against Company or any of its
Subsidiaries or to the best knowledge of Company, threatened against any of
them, (b) no strike or work stoppage in existence or threatened involving
Company or any of its Subsidiaries that could reasonably be expected to have a
Material Adverse Effect, and (c) to the best knowledge of Company, no union
representation question existing with respect to the employees of Company or any
of its Subsidiaries and, to the best knowledge of Company, no union organization
activity that is taking place, except (with respect to any matter specified in
clause (a), (b) or (c) above, either individually or in the aggregate) such as
is not reasonably likely to have a Material Adverse Effect.

4.21 Employee Benefit Plans. Company, each of its Subsidiaries and each of their
respective ERISA Affiliates are in compliance in all material respects with all
applicable provisions and requirements of ERISA and the Internal Revenue Code
and the regulations and published interpretations thereunder with respect to
each Employee Benefit Plan, and have performed in all material respects their
obligations under each Employee Benefit Plan. Each Employee Benefit Plan which
is intended to qualify under Section 401(a) of the Internal Revenue Code has
received a favorable determination letter from the Internal Revenue Service
indicating that such Employee Benefit Plan is so qualified and nothing has
occurred subsequent to the issuance of such determination letter which would
cause such Employee Benefit Plan to lose its qualified status. No material
liability to the PBGC (other than required premium payments), the Internal
Revenue Service, any Employee Benefit Plan or any trust established under Title
IV of ERISA has been or is expected to be incurred by Company, any of its
Subsidiaries or any of their ERISA Affiliates. No ERISA Event has occurred or is
reasonably expected to occur. Except to the extent required under Section 4980B
of the Internal Revenue Code or similar state laws, no Employee Benefit Plan
provides health or welfare benefits (through the purchase of insurance or
otherwise) for any retired or former employee of Company, any of its
Subsidiaries or any of their respective ERISA Affiliates. The present value of
the aggregate benefit liabilities under each Pension Plan sponsored, maintained
or contributed to by Company, any of its Subsidiaries or any of their ERISA
Affiliates (determined as of the end of the most recent plan year on the basis
of the actuarial assumptions specified for funding purposes in the most recent
actuarial valuation for such Pension Plan), did not exceed the aggregate current
value of the assets of such Pension Plan. As of the most recent valuation date
for each Multiemployer Plan for which the actuarial report is available, the
potential liability of Company, its Subsidiaries and their respective ERISA
Affiliates for a complete withdrawal from such Multiemployer Plan (within the
meaning of Section 4203 of ERISA), when aggregated with such potential liability
for a complete withdrawal from all Multiemployer Plans, based on information
available pursuant to Section 4221(e) of ERISA is zero. Company, each of its
Subsidiaries and each of their ERISA Affiliates have complied with the
requirements of Section 515 of ERISA with respect to each Multiemployer Plan and
are not in material “default” (as defined in Section 4219(c)(5) of ERISA) with
respect to payments to a Multiemployer Plan.

4.22 Certain Fees. No broker’s or finder’s fee or commission will be payable
with respect hereto or any of the transactions contemplated hereby.

4.23 Solvency. Each Credit Party is and, upon the incurrence of any Obligation
by such Credit Party on any date on which this representation and warranty is
made, will be, Solvent.

4.24 Related Agreements.

(a) Delivery. Company has delivered to Administrative Agent complete and correct
copies of (i) each Related Agreement and of all exhibits and schedules thereto
as of the date hereof and (ii) copies of any material amendment, restatement,
supplement or other modification to or waiver of each Related Agreement entered
into after the date hereof.

(b) Representations and Warranties. Except to the extent otherwise expressly set
forth herein or in the schedules hereto, and subject to the qualifications set
forth therein, each of the representations and warranties given by any Credit
Party in any Related Agreement is true and correct in all material respects as
of the Closing Date (or as of any earlier date to which such representation and
warranty specifically relates). Notwithstanding anything in the Related
Agreement to the contrary, the representations and warranties of each Credit
Party set forth in this Section 4.24 shall, solely for purposes hereof, survive
the Closing Date for the benefit of Lenders.

(c) Governmental Approvals. All Governmental Authorizations and all other
authorizations, approvals and consents of any other Person required by the
Related Agreements or to consummate the Acquisition and other transactions
contemplated by the Related Agreements have been obtained and are in full force
and effect, except for (i) filings and recordings with respect to the Collateral
to be made on or after the Closing Date, (ii) routine filings required to be
made in the ordinary course of business pursuant to the requirements of
applicable law, and (iii) consents, the failure to obtain of which would not
reasonably be expected to have a Material Adverse Effect.

(d) Conditions Precedent. On the Closing Date, (i) all of the conditions to
effecting or consummating the Acquisition and other transactions contemplated by
the Related Agreements have been duly satisfied or, with the consent of
Administrative Agent, waived, and (ii) the Acquisition and other transactions
contemplated by the Related Agreements has been consummated in accordance with
the Related Agreements and all applicable laws.

4.25 Compliance with Statutes, etc. Each of Company and its Subsidiaries is in
compliance with all applicable statutes, regulations and orders of, and all
applicable restrictions imposed by, all Governmental Authorities, in respect of
the conduct of its business and the ownership of its property (including
compliance with all applicable Environmental Laws), except such non-compliance
that, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect.

4.26 Future Commitments. Except with respect to gas imbalances, take-or-pay or
other prepayments with respect to any Oil and Gas Property of Company or any of
the Guarantors which would require Company or any of the Guarantors either
(a) to deliver Hydrocarbons produced from Oil and Gas Properties or (b) to make
cash settlements for such products with a value not in excess of $2,000,000, on
a net basis there are no gas imbalances, take-or-pay or other prepayments with
respect to any Oil and Gas Property of Company or any of the Guarantors or any
cash settlement for such products at some future time without then or thereafter
receiving full payment therefor.

4.27 Disclosure. No representation or warranty of any Credit Party contained in
any Credit Document or in any other documents, certificates or written
statements furnished to Lenders by or on behalf of Company or any of its
Subsidiaries for use in connection with the transactions contemplated hereby
contains any untrue statement of a material fact or omits to state a material
fact (known to Company, in the case of any document not furnished by either of
them) necessary in order to make the statements contained herein or therein,
taken as a whole, not misleading in light of the circumstances in which the same
were made. Any projections and pro forma financial information contained in such
materials are based upon good faith estimates and assumptions believed by
Company to be reasonable at the time made, it being recognized by Lenders that
such projections as to future events are not to be viewed as facts and that
actual results during the period or periods covered by any such projections may
differ from the projected results. There are no facts known to Company (other
than matters of a general economic nature) that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect
and that have not been disclosed herein or in such other documents,
certificates, reports and statements furnished to Lenders for use in connection
with the transactions contemplated hereby.

SECTION 5 AFFIRMATIVE COVENANTS

Each Credit Party covenants and agrees that so long as any Commitment is in
effect and until payment in full of all Obligations and cancellation or
expiration of all Letters of Credit, each Credit Party shall perform, and shall
cause each of its Subsidiaries to perform, all covenants in this Section 5.

5.1 Financial Statements and Other Reports. Company will deliver to
Administrative Agent and Lenders:

(a) Quarterly Financial Statements. As soon as available, and in any event
within forty-five (45) days after the end of each of the first three Fiscal
Quarters of each Fiscal Year, the consolidated balance sheets of Company and its
Subsidiaries as at the end of such Fiscal Quarter and the related consolidated
statements of income, stockholders’ equity and cash flows of Company and its
Subsidiaries for such Fiscal Quarter and for the period from the beginning of
the then current Fiscal Year to the end of such Fiscal Quarter, setting forth in
each case in comparative form the corresponding figures for the corresponding
periods of the previous Fiscal Year and the corresponding figures from the
Financial Plan for the current Fiscal Year, all in reasonable detail, together
with a Financial Officer Certification;

(b) Annual Financial Statements. As soon as available, and in any event no later
than the earlier of (x) one hundred five (105) days after the end of each Fiscal
Year and (y) five days after Company is required, under the Exchange Act, to
file its Annual Report on Form 10-K, (i) the consolidated balance sheets of
Company and its Subsidiaries as at the end of such Fiscal Year and the related
consolidated statements of income, stockholders’ equity and cash flows of
Company and its Subsidiaries for such Fiscal Year, setting forth in each case in
comparative form the corresponding figures for the previous Fiscal Year and the
corresponding figures from the Financial Plan for the Fiscal Year covered by
such financial statements, in reasonable detail, together with a Financial
Officer Certification and a Narrative Report with respect thereto; and (ii) with
respect to such consolidated financial statements a report thereon of Ernst &
Young LLP or other independent certified public accountants of recognized
national standing selected by Company (which report shall be unqualified as to
going concern and scope of audit, and shall state that such consolidated
financial statements fairly present, in all material respects, the consolidated
financial position of Company and its Subsidiaries as at the dates indicated and
the results of their operations and their cash flows for the periods indicated
in conformity with GAAP applied on a basis consistent with prior years (except
as otherwise disclosed in such financial statements) and that the examination by
such accountants in connection with such consolidated financial statements has
been made in accordance with generally accepted auditing standards) together
with a written statement by such independent certified public accountants
stating (1) that their audit examination has included a review of the terms of
the Credit Documents, (2) whether, in connection therewith, any condition or
event that constitutes a Default or an Event of Default has come to their
attention and, if such a condition or event has come to their attention,
specifying the nature and period of existence thereof (it being understood that
such examination and statement shall be limited to the items that independent
certified public accountants are permitted to cover in such statements pursuant
to their professional standards and customs of the profession), and (3) that
nothing has come to their attention that causes them to believe that the
information contained in any Compliance Certificate is not correct or that the
matters set forth in such Compliance Certificate are not stated in accordance
with the terms hereof;

(c) [Reserved];

(d) Compliance Certificate. Together with each delivery of financial statements
of Company and its Subsidiaries pursuant to Sections 5.1(a) and 5.1(b), a duly
executed and completed Compliance Certificate and Financial Officer certificate
pursuant to Section 6.8(g);

(e) Statements of Reconciliation after Change in Accounting Principles. If, as a
result of any change in accounting principles and policies from those used in
the preparation of the Historical Financial Statements, the consolidated
financial statements of Company and its Subsidiaries delivered pursuant to
Section 5.1(a) or 5.1(b) will differ in any material respect from the
consolidated financial statements that would have been delivered pursuant to
such subdivisions had no such change in accounting principles and policies been
made, then, together with the first delivery of such financial statements after
such change, one or more statements of reconciliation for the Fiscal Year
immediately prior to the then current Fiscal Year in form and substance
satisfactory to Administrative Agent;

(f) Notice of Default. Promptly upon any officer of Company obtaining knowledge
(i) of any condition or event that constitutes a Default or an Event of Default
or that notice has been given to Company with respect thereto; (ii) that any
Person has given any notice to Company or any of its Subsidiaries or taken any
other action with respect to any event or condition set forth in Section 8.1(b);
or (iii) of the occurrence of any event or change that has caused or evidences,
either in any case or in the aggregate, a Material Adverse Effect, a certificate
of its Authorized Officers specifying the nature and period of existence of such
condition, event or change, or specifying the notice given and action taken by
any such Person and the nature of such claimed Event of Default, Default,
default, event or condition, and what action Company has taken, is taking and
proposes to take with respect thereto;

(g) Notice of Litigation. Promptly upon any officer of Company obtaining
knowledge of (i) the institution of, or non-frivolous threat of, any Adverse
Proceeding not previously disclosed in writing by Company to Lenders, or
(ii) any material development in any Adverse Proceeding that, in the case of
either (i) or (ii) could be reasonably expected to have a Material Adverse
Effect, or seeks to enjoin or otherwise prevent the consummation of, or to
recover any damages or obtain relief as a result of, the transactions
contemplated hereby, written notice thereof together with such other information
as may be reasonably available to Company to enable Lenders and their counsel to
evaluate such matters;

(h) ERISA. (i) Promptly upon any officer of Company obtaining knowledge of the
occurrence of or forthcoming occurrence of any ERISA Event, a written notice
specifying the nature thereof, what action Company, any of its Subsidiaries or
any of their respective ERISA Affiliates has taken, is taking or proposes to
take with respect thereto and, when known, any action taken or threatened by the
Internal Revenue Service, the Department of Labor or the PBGC with respect
thereto; and (ii) with reasonable promptness, copies of (1) each Schedule B
(Actuarial Information) to the annual report (Form 5500 Series) filed by
Company, any of its Subsidiaries or any of their respective ERISA Affiliates
with the Internal Revenue Service with respect to each Pension Plan; (2) all
notices received by Company, any of its Subsidiaries or any of their respective
ERISA Affiliates from a Multiemployer Plan sponsor concerning an ERISA Event;
and (3) copies of such other documents or governmental reports or filings
relating to any Employee Benefit Plan as Administrative Agent shall reasonably
request;

(i) Financial Plan. As soon as practicable and in any event no later than thirty
days after the beginning of each Fiscal Year, a consolidated plan and financial
forecast for such Fiscal Year (a “Financial Plan”), including (i) a forecasted
consolidated balance sheet and forecasted consolidated statements of income and
cash flows of Company and its Subsidiaries for such Fiscal Year, together with
pro forma Compliance Certificates for such Fiscal Year and an explanation of the
assumptions on which such forecasts are based, (ii) forecasted consolidated
statements of income and cash flows of Company and its Subsidiaries for each
quarter of such Fiscal Year, (iii) forecasts addressing Company’s projected
compliance with the requirements of Section 6.8 during such Fiscal Year, and
(iv) forecasts addressing Company’s liquidity through the end of such Fiscal
Year, together, in each case, with an explanation of the assumptions on which
such forecasts are based all in form and substance reasonably satisfactory to
Administrative Agent;

(j) Insurance Report. As soon as practicable and in any event by the last day of
each Fiscal Year, a report in form and substance satisfactory to Administrative
Agent outlining all material insurance coverage maintained as of the date of
such report by Company and its Subsidiaries and all material insurance coverage
planned to be maintained by Company and its Subsidiaries in the immediately
succeeding Fiscal Year;

(k) Notice of Change in Board of Directors. With reasonable promptness, written
notice of any change in the board of directors (or similar governing body) of
Company;

(l) Notice Regarding Material Contracts. Promptly, and in any event within ten
Business Days (i) after any Material Contract of Company or any of its
Restricted Subsidiaries is terminated or amended in a manner that could
reasonably be expected to have a Material Adverse Effect, or (ii) any new
Material Contract is entered into, a written statement describing such event,
with copies of such material amendments or new contracts, delivered to
Administrative Agent (to the extent such delivery is permitted by the terms of
any such Material Contract, provided, no such prohibition on delivery shall be
effective if it were bargained for by Company or its applicable Restricted
Subsidiary with the intent of avoiding compliance with this Section 5.1(l)), and
an explanation of any actions being taken with respect thereto;

(m) [Reserved];

(n) Information Regarding Collateral. Company will furnish to Collateral Trustee
prompt written notice, with a copy to Administrative Agent, of any change (i) in
any Credit Party’s corporate name, (ii) in any Credit Party’s identity or
corporate structure or (iii) in any Credit Party’s Federal Taxpayer
Identification Number. Company agrees not to effect or permit any change
referred to in the preceding sentence unless all filings have been made under
the Uniform Commercial Code or otherwise that are required in order for
Collateral Trustee to continue at all times following such change to have a
valid, legal and perfected security interest in all the Collateral and for the
Collateral at all times following such change to have a valid, legal and
perfected security interest as contemplated in the Collateral Documents. Company
also agrees promptly to notify Collateral Trustee if any material portion of the
Collateral is damaged or destroyed;

(o) Annual Collateral Verification. Each year, at the time of delivery of annual
financial statements with respect to the preceding Fiscal Year pursuant to
Section 5.1(b), Company shall deliver to Collateral Trustee, with a copy to
Administrative Agent, an Officer’s Certificate (i) either confirming that there
has been no change in the information contained in the Schedules to this
Agreement or in the Collateral Documents since the Closing Date or the date of
the most recent certificate delivered pursuant to this Section and/or
identifying such changes (ii) certifying that all Uniform Commercial Code
financing statements (including fixtures filings, as applicable) or other
appropriate filings, recordings or registrations, have been filed of record in
each governmental, municipal or other appropriate office in each jurisdiction
identified pursuant to clause (i) above to the extent necessary to perfect the
security interests under the Collateral Documents for a period of not less than
18 months after the date of such certificate (except as noted therein with
respect to any continuation statements to be filed within such period);

(p) Engineering Report. Not later than 60 days after June 30th an Internal
Engineering Report and December 31st of each year an Independent Engineering
Report, in each case certified by the Internal Engineer or the Independent
Engineer, as applicable, to be true and accurate and to have been prepared in
accordance with the standard procedures used in the Oil and Gas Business, and
together with each such Engineering Report, a certificate of an Authorized
Officer (in his or her capacity as an officer of Company and not in his or her
individual capacity) certifying that, to the best of his knowledge (1) the
information contained in the Engineering Report and any other information
delivered in connection therewith is true and correct in all material respects,
(2) Company and the Guarantors own good and defensible title to their Oil and
Gas Properties evaluated in such Engineering Report and such Properties are free
and clear of all Liens except for Permitted Liens, (3) except as set forth on an
exhibit to the certificate, on a net basis there are no gas imbalances,
take-or-pay, Production Payments or other prepayments with respect to its Oil
and Gas Properties evaluated in such Engineering Report which would require
Company or the Guarantors to deliver Hydrocarbons produced from such Oil and Gas
Properties or make cash payments at some future time without then or thereafter
receiving full payment therefor, and (4) except as set forth on an exhibit to
the certificate, none of its Oil and Gas Properties have been sold since the
date of the Engineering Report, most recently delivered pursuant to this
subsection 5.1(p), which exhibit shall list all of its Oil and Gas Properties
sold and in such detail as is reasonably required by the Administrative Agent;

(q) [Reserved]; and

(r) Other Information. (A) Promptly upon their becoming available, copies of
(i) all financial statements, proxy statements and other similar reports and
notices sent or made available generally by Company to its security holders
acting in such capacity or by any Subsidiary of Company to its security holders
other than Company or another Subsidiary of Company, (ii) all regular and
periodic reports and all registration statements and prospectuses, if any, filed
by Company or any of its Subsidiaries with any securities exchange or with the
Securities and Exchange Commission and (iii) all press releases and other
statements made available generally by Company or any of its Subsidiaries to the
public concerning material developments in the business of Company or any of its
Subsidiaries, and (B) such other information and data with respect to Company or
any of its Subsidiaries as from time to time may be reasonably requested by
Administrative Agent or any Lender.

5.2 Existence. Except as otherwise permitted under Section 6.9, each Credit
Party will, and will cause each of its Subsidiaries to, at all times preserve
and keep in full force and effect its existence and all rights and franchises,
licenses and permits material to its business except where failure to maintain
such rights, franchises, licenses and permits either is no longer required by
applicable law or could not reasonably be expected to have a Material Adverse
Effect or that the loss thereof is not disadvantageous in any material respect
to such Person or to Lenders.

5.3 Payment of Taxes and Claims. Each Credit Party will, and will cause each of
its Subsidiaries to, pay all Taxes imposed upon it or any of its properties or
assets or in respect of any of its income, businesses or franchises before any
penalty or fine accrues thereon, and all claims (including claims for labor,
services, materials and supplies) for sums that have become due and payable and
that by law have or may become a Lien upon any of its properties or assets,
prior to the time when any penalty or fine shall be incurred with respect
thereto; provided, no such Tax or claim need be paid if it is being contested in
good faith by appropriate proceedings promptly instituted and diligently
conducted, so long as (a) adequate reserve or other appropriate provision, as
shall be required in conformity with GAAP shall have been made therefor, and
(b) in the case of a Tax or claim which has or may become a Lien against any of
the Collateral, such contest proceedings conclusively operate to stay the sale
of any portion of the Collateral to satisfy such Tax or claim. No Credit Party
will, nor will it permit any of its Subsidiaries to, file or consent to the
filing of any consolidated income tax return with any Person (other than Company
or any of its Subsidiaries).

5.4 Maintenance of Properties. Each Credit Party will, and will cause each of
its Restricted Subsidiaries to, maintain or cause to be maintained in good
repair, working order and condition, ordinary wear and tear excepted, all
material properties used or useful in the business of Company and its Restricted
Subsidiaries and from time to time will make or cause to be made all appropriate
repairs, renewals and replacements thereof.

5.5 Insurance. Company will maintain or cause to be maintained, with financially
sound and reputable insurers, such public liability insurance, third party
property damage insurance, business interruption insurance and casualty
insurance with respect to liabilities, losses or damage in respect of the
assets, properties and businesses of Company and its Subsidiaries as may
customarily be carried or maintained under similar circumstances by Persons of
established reputation engaged in similar businesses, in each case in such
amounts (giving effect to self-insurance), with such deductibles, covering such
risks and otherwise on such terms and conditions as shall be customary for such
Persons. Without limiting the generality of the foregoing, Company will maintain
or cause to be maintained (a) flood insurance with respect to each Flood Hazard
Property that is located in a community that participates in the National Flood
Insurance Program, in each case in compliance with any applicable regulations of
the Board of Governors of the Federal Reserve System, and (b) casualty insurance
on the Collateral under such policies of insurance, with such insurance
companies, in such amounts, with such deductibles, and covering such risks as
are at all times carried or maintained under similar circumstances by Persons of
established reputation engaged in similar businesses. Each such policy of
insurance shall (i) name Collateral Trustee, on behalf of Secured Parties as an
additional insured thereunder as its interests may appear and (ii) in the case
of each casualty insurance policy, contain a standard loss payable clause or
endorsement that names Collateral Trustee, on behalf of Secured Parties as the
loss payee thereunder and provides for at least thirty days’ prior written
notice to Collateral Trustee of any modification or cancellation of such policy.

5.6 Books and Records; Inspections. Each Credit Party will, and will cause each
of its Subsidiaries to (i) keep proper books of record and account, in which
full and correct entries shall be made of all financial transactions and the
assets and business of Company and each of its Subsidiaries in accordance with
GAAP and (ii) permit, upon notice to Administrative Agent by a Lender, any
authorized representatives designated by any such Lender to visit and inspect
any of the properties of any Credit Party and any of its respective
Subsidiaries, to inspect, copy and take extracts from its and their financial
and accounting records, and to discuss its and their affairs, finances and
accounts with its and their officers and independent public accountants, all
upon reasonable notice and at such reasonable times during normal business hours
and as often as may reasonably be requested.

5.7 Lenders Meetings. Company will, upon the request of Administrative Agent or
Requisite Lenders, participate in a meeting of Administrative Agent and Lenders
once during each Fiscal Year to be held at Company’s corporate offices (or at
such other location as may be agreed to by Company and Administrative Agent) at
such time as may be agreed to by Company and Administrative Agent.

5.8 Compliance with Laws. Each Credit Party will comply, and shall use
reasonable efforts to cause each of its Subsidiaries and all other Persons, if
any, on or occupying any Facilities to comply, with the requirements of all
applicable laws, rules, regulations and orders of any Governmental Authority
(including all Environmental Laws), noncompliance with which could reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.

5.9 Environmental.

(a) Environmental Disclosure. Company will deliver to Administrative Agent and
Lenders:

(i) as soon as practicable following receipt thereof, notification of, and, upon
request, copies of all material environmental audits, investigations, analyses
and reports (except to the extent where doing so would, upon advice of Company
counsel, jeopardize an applicable privilege, and then only to the extent
Company, the Administrative Agent and the Lenders cannot reasonably agree on a
confidentiality agreement that protects such privilege), whether prepared by
personnel of Company or any of its Subsidiaries or by independent consultants,
Governmental Authorities or any other Persons, with respect to significant
environmental matters at any Facility or Oil and Gas Properties or with respect
to any Environmental Claims;

(ii) promptly upon the occurrence thereof, written notice describing in
reasonable detail (1) any Release required to be reported to any federal, state
or local governmental or regulatory agency under any applicable Environmental
Laws that could reasonably result in a Material Adverse Effect, (2) any remedial
action taken by Company or any other Person in response to any Hazardous
Materials Activities, or any Environmental Claims that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect,
and (3) Company’s discovery of any occurrence or condition at or from any real
property adjoining or in the vicinity of any Facility or Oil and Gas Properties
that could cause the Company or any of its Subsidiaries to be required under
Environmental Law to undertake remedial action or cause such Facility or Oil and
Gas Properties or any part thereof to be subject to any material restrictions on
the ownership, occupancy, transferability or use thereof under any Environmental
Laws that could reasonably be expected to result in a Material Adverse Effect;

(iii) as soon as practicable following the sending or receipt thereof by Company
or any of its Subsidiaries, a copy of any material written communications
(except to the extent where doing so would, upon advice of Company counsel,
jeopardize an applicable privilege, and then only to the extent Company, the
Administrative Agent and the Lenders cannot reasonably agree on a
confidentiality agreement that protects such privilege), with respect to (1) any
Environmental Claims that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect, (2) any Release required to be
reported to any federal, state or local governmental or regulatory agency that
could reasonably be expected to result in a material Environmental Claim, and
(3) any written request for information from any Governmental Agency that
suggests such authority is investigating whether Company or any of its
Subsidiaries may be potentially responsible for any Hazardous Materials Activity
that could reasonably be expected to result in a Material Adverse Effect;

(iv) prompt written notice describing in reasonable detail (1) any proposed
acquisition of stock, assets, or property by Company or any of its Subsidiaries
that could reasonably be expected to expose Company or any of its Subsidiaries
to, or result in, Environmental Claims that could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect and (2) any
proposed action to be taken by Company or any of its Subsidiaries to modify
current operations in a manner that could reasonably be expected to subject
Company or any of its Subsidiaries to any additional material obligations or
requirements under any Environmental Laws that could reasonably result in a
Material Adverse Effect; and

(v) with reasonable promptness, such other documents and information as from
time to time may be reasonably requested by Administrative Agent in relation to
any matters disclosed pursuant to this Section 5.9(a).

(b) Hazardous Materials Activities, Etc. Each Credit Party shall promptly take,
and shall use reasonable efforts to cause each of its Subsidiaries promptly to
take, any and all actions necessary to (i) cure any violation of applicable
Environmental Laws by Company or its Subsidiaries that could reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect,
and (ii) promptly discharge any Environmental Claim against Company or any of
its Subsidiaries and discharge any obligations it may have to any Person
thereunder where failure to do so could reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.

5.10 Subsidiaries. In the event that (i) any Person becomes a Domestic
Subsidiary that is a Material Subsidiary or (ii) any Domestic Subsidiary of
Company in existence as of the Closing Date which is not a Guarantor becomes a
Material Subsidiary, Company shall (a) promptly cause such Domestic Subsidiary
to become a Guarantor hereunder and a Grantor under the Pledge and Security
Agreement by executing and delivering to Administrative Agent and Collateral
Trustee a Counterpart Agreement, and (b) take all such actions and execute and
deliver, or cause to be executed and delivered, all such documents, instruments,
agreements, and certificates as are similar to those described in
Sections 3.1(b), 3.1(i) (provided that Mortgages on Hydrocarbon Interests shall
be required only to the extent provided in Section 5.11), 3.1(j) and 3.1(n), and
in the case of each Leasehold Property that is a Closing Date Mortgaged
Property, (1) a Landlord Consent and Estoppel and (2) Evidence that such
Leasehold Property is a Recorded Leasehold Interest. In the event that any
Person becomes a Foreign Subsidiary of Company that is a Restricted Subsidiary,
and the ownership interests of such Foreign Subsidiary are owned by Company or
by any Domestic Subsidiary thereof, Company shall, or shall cause such Domestic
Subsidiary to, deliver, all such documents, instruments, agreements, and
certificates as are similar to those described in Sections 3.1(b), and Company
shall take, or shall cause such Domestic Subsidiary to take, all of the actions
referred to in Section 3.1(j)(i) necessary to grant and an Acceptable Security
Interest under the Pledge and Security Agreement in 65% of such ownership
interests. With respect to each such Subsidiary, Company shall promptly send to
Administrative Agent written notice setting forth with respect to such Person
(i) the date on which such Person became a Subsidiary of Company, and (ii) all
of the data required to be set forth in Schedules 4.1 and 4.2 with respect to
all Subsidiaries of Company; provided, such written notice shall be deemed to
supplement Schedule 4.1 and 4.2 for all purposes hereof.

5.11 Additional Material Real Estate Assets.

(a) In the event that any Credit Party (i) acquires a Material Real Estate
Asset, (ii) acquires any Hydrocarbon Interests which Hydrocarbon Interest
produces in commercially reasonable quantities, or (iii) develops a previously
undeveloped Hydrocarbon Interest, such Hydrocarbon Interest produces in
commercially reasonable quantities and such Hydrocarbon Interest has not
otherwise been made subject to the Lien of the Collateral Documents in favor of
Collateral Trustee, for the benefit of Secured Parties, or (iv) a Real Estate
Asset owned or leased on the Closing Date becomes a Material Real Estate Asset
and such interest has not otherwise been made subject to the Lien of the
Collateral Documents in favor of Collateral Trustee, for the benefit of Secured
Parties, then in each case such Credit Party, contemporaneously with the
occurrence of any of the events described in clauses (i) or (iv) of this
Section 5.11 and semi-annually with respect to the events described in clauses
(ii) and (iii) of this Section 5.11, shall take all such actions and execute and
deliver, or cause to be executed and delivered, all such mortgages, documents,
instruments, agreements, opinions and certificates similar to those described in
Sections 3.1(i), 3.1(j) and 3.1(k) with respect to each such Material Real
Estate Asset or Hydrocarbon Interests that Administrative Agent shall reasonably
request to create, subject to any filing and/or recording referred to herein, an
Acceptable Security Interest in such Material Real Estate Assets or Hydrocarbon
Interests. In addition to the foregoing, Company shall, at the request of
Requisite Lenders, deliver, from time to time, to Administrative Agent such
appraisals as are required by law or regulation of Real Estate Assets with
respect to which Collateral Trustee has been granted a Lien, but, other than
after the occurrence and during the continuance of an Event of Default, not more
than one such appraisal in any twelve month period.

(b) No later than ninety (90) days after June 30th and December 31st of each
year, Company and the Guarantors shall, if required, take all such actions and
execute and deliver, or cause to be executed and delivered, all such mortgages,
documents, instruments, agreements, opinions and certificates similar to those
described in Section 3.1(i) with respect to additional Hydrocarbon Interests
which have not otherwise been made subject to the Lien of the Collateral
Documents in favor of Collateral Trustee, for the benefit of Secured Parties,
such that the aggregate of Hydrocarbon Interests subject to the Lien of the
Collateral Documents in favor of Collateral Trustee, for the benefit of Secured
Parties, shall represent no less than 80% of the value of the Proven Reserves of
Company and the Guarantors based on the most recent Engineering Report.

5.12 Title Opinions. The Company shall from time to time upon the reasonable
request of the Administrative Agent after each scheduled redetermination of the
Borrowing Base commencing with the July 1, 2005 Borrowing Base redetermination,
take such actions and execute and deliver such documents and instruments as the
Administrative Agent shall require to ensure that the Administrative Agent shall
have received satisfactory title opinions (including, if requested, supplemental
or new title opinions addressed to it) or other title evidence, which title
opinions or other title evidence shall be in form and substance acceptable to
the Administrative Agent in its sole discretion and shall include, if title
opinions are requested by the Administrative Agent, opinions regarding the
before payout and after payout ownership interests held by the Company and the
Guarantors, for all wells located on the Oil and Gas Properties covered thereby
as to the ownership of Oil and Gas Properties of the Company and the Guarantors,
and reflecting that the Administrative Agent has an Acceptable Security Interest
in such Oil and Gas Properties of the Company and the Guarantors, constituting
at least 80% of the value of the Proven Reserves of Company and the Guarantors
based on the most recent Engineering Report. Notwithstanding the foregoing, the
Administrative Agent and each Lender acknowledge and agree that the title
opinions and other evidence of title furnished under and in satisfaction of
Section 3.1(i)(ii) shall satisfy the requirements of this Section 5.12 with
respect to the Oil and Gas Properties of the Company and the Guarantors owned as
of the Closing Date.

5.13 Swap Agreement. It is contemplated by the Company that the J. Aron Swap
will remain in place during the term of this Agreement on terms and conditions
satisfactory to the Administrative Agent; provided, however, the Company shall
have the right to terminate the J. Aron Swap, but only if the Borrowing Base
shall have been redetermined before giving effect to the termination and, after
giving effect thereto, no Event of Default would exist and Total Utilization
would not exceed the lesser of the Borrowing Base and the Revolving Commitments.

5.14 Further Assurances. At any time or from time to time upon the request of
Administrative Agent, each Credit Party will, at its expense, promptly execute,
acknowledge and deliver such further documents and do such other acts and things
as Administrative Agent or Collateral Trustee may reasonably request in order to
effect fully the purposes of the Credit Documents, including providing Lenders
with any information requested pursuant to Section 10.21. In furtherance and not
in limitation of the foregoing, each Credit Party shall take such actions as
Administrative Agent or Collateral Trustee may reasonably request from time to
time to ensure that the Obligations are guarantied by the Guarantors and,
subject to the limitations set forth in Section 5.11(b) above and the
limitations on security provided in the Collateral Documents, are secured by
substantially all of the assets of Company and the Guarantors and all of the
outstanding Capital Stock of Company and its Subsidiaries other than
Unrestricted Subsidiaries and any Subsidiaries of Unrestricted Subsidiaries
(subject to limitations contained in the Credit Documents with respect to
Foreign Subsidiaries).

5.15 Non-Consolidation. Unless otherwise consented to by Agents or Requisite
Lenders, Company will and will cause each of its Material Subsidiaries to:
(i) maintain entity records and books of account separate from those of any
other entity which is an Affiliate of such entity; (ii) not commingle its funds
or assets with those of any other entity which is an Affiliate of such entity;
and (iii) provide that its board of directors or other analogous governing body
will hold all appropriate meetings to authorize and approve such entity’s
actions, which meetings will be separate from those of other entities.

SECTION 6 NEGATIVE COVENANTS

Each Credit Party covenants and agrees that, so long as any Commitment is in
effect and until payment in full of all Obligations and cancellation or
expiration of all Letters of Credit, such Credit Party shall perform, and shall
cause each of its Restricted Subsidiaries to perform, all covenants in this
Section 6.

6.1 Indebtedness. No Credit Party shall, nor shall it permit any of its
Restricted Subsidiaries to, directly or indirectly, create, incur, assume or
guaranty, or otherwise become or remain directly or indirectly liable with
respect to any Indebtedness, except:

(a) the Obligations;

(b) unsecured Indebtedness of any Guarantor to Company or to any other
Guarantor, or of Company to any Guarantor;

(c) the Senior Secured Indebtedness;

(d) Indebtedness incurred by Company or any of its Restricted Subsidiaries
arising from agreements providing for indemnification, adjustment of purchase
price or similar obligations, or from guaranties or letters of credit, surety
bonds or performance bonds securing the performance of Company or any such
Restricted Subsidiary pursuant to such agreements, in connection with Permitted
Acquisitions or permitted dispositions of any business, assets or Restricted
Subsidiary of Company or any of its Restricted Subsidiaries;

(e) Indebtedness which may be deemed to exist pursuant to any guaranties,
performance, surety, statutory, appeal or similar obligations incurred in the
ordinary course of business;

(f) Indebtedness in respect of netting services, overdraft protections and
otherwise in connection with deposit accounts;

(g) guaranties in the ordinary course of business of the obligations of
suppliers, customers, franchisees and licensees of Company and its Restricted
Subsidiaries;

(h) guaranties by Company of Indebtedness of a Guarantor or guaranties by a
Restricted Subsidiary of Company of Indebtedness of Company or a Guarantor with
respect, in each case, to Indebtedness otherwise permitted to be incurred
pursuant to this Section 6.1;

(i) Indebtedness described in Schedule 6.1, but not any extensions, renewals or
replacements of such Indebtedness except (i) renewals and extensions expressly
provided for in the agreements evidencing any such Indebtedness as the same are
in effect on the date of this Agreement and (ii) refinancings and extensions of
any such Indebtedness if the terms and conditions thereof are not less favorable
to the obligor thereon or to the Lenders than the Indebtedness being refinanced
or extended, and the average life to maturity thereof is greater than or equal
to that of the Indebtedness being refinanced or extended; provided, such
Indebtedness permitted under the immediately preceding clause (i) or (ii) above
shall not (A) include Indebtedness of an obligor that was not an obligor with
respect to the Indebtedness being extended, renewed or refinanced, (B) exceed in
a principal amount the Indebtedness being renewed, extended or refinanced or
(C) be incurred, created or assumed if any Default or Event of Default has
occurred and is continuing or would result therefrom;

(j) Indebtedness incurred under the Swap Agreements as of the Closing Date;

(k) additional Indebtedness incurred under the Swap Agreements after the Closing
Date or any replacement thereof, but in no event covering the expected
production of Hydrocarbons from more than 100% of Proved Developed Producing
Reserves, as set forth in the most recent Engineering Report delivered pursuant
to Section 5.1(p);

(l) Indebtedness incurred under any Interest Rate Agreement or Currency
Agreement otherwise entered into in the ordinary course of Company’s or any of
its Restricted Subsidiaries’ businesses and not for speculative purposes;

(m) Qualified Junior Debt;

(n) in-kind obligations relating to net oil and natural gas balancing positions
arising in the ordinary course of business;

(o) any obligation arising from agreements of Company or a Restricted Subsidiary
of Company providing for indemnification, guarantee, contingency payment
obligation based on the performance of the acquired or disposed asset or similar
obligations, in each case, incurred or assumed in connection with the
acquisition or disposition of any business, asset or Capital Stock of a
Guarantor, to the extent permitted hereunder;

(p) Indebtedness with respect to Capital Leases and purchase money Indebtedness
secured by Liens permitted by Section 6.2 (including any Indebtedness acquired
in connection with a Permitted Acquisition) in an aggregate amount not to exceed
at any time $5,000,000; provided, that such purchase money Indebtedness (other
than Indebtedness acquired in connection with a Permitted Acquisition) (i) shall
be secured only by the asset acquired in connection with the incurrence of such
Indebtedness, and (ii) shall constitute not less than 70% and not more than 100%
of the aggregate consideration paid with respect to such asset;

(q) other unsecured Indebtedness of Company and its Restricted Subsidiaries, in
an aggregate amount not to exceed at any time $10,000,000; and

(r) up to $20,000,000 aggregate principal amount of unsecured subordinated debt
outstanding at any one time; provided any such Indebtedness incurred pursuant to
this Section 6.1(r) in an aggregate principal amount of $10,000,000 or more in
any one transaction or series of related transactions shall be on subordination
terms and conditions reasonably acceptable to the Administrative Agent.

6.2 Liens. No Credit Party shall, nor shall it permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or permit to
exist any Lien on or with respect to any property or asset of any kind
(including any document or instrument in respect of goods or accounts
receivable) of Company or any of its Restricted Subsidiaries, whether now owned
or hereafter acquired, or any income or profits therefrom, or file or permit the
filing of, or permit to remain in effect, any financing statement or other
similar notice of any Lien with respect to any such property, asset, income or
profits under the UCC of any State or under any similar recording or notice
statute, except:

(a) Liens in favor of Collateral Trustee for the benefit of Secured Parties
granted pursuant to any Credit Document;

(b) Liens for Taxes (i) not yet due and payable or (ii) if obligations with
respect to such Taxes are being contested in good faith by appropriate
proceedings promptly instituted and diligently conducted, so long as adequate
reserves or other appropriate provision, as shall be required in conformity with
GAAP, shall have been made with respect to such Taxes;

(c) statutory Liens of landlords, banks (and rights of set-off), of carriers,
warehousemen, mechanics, repairmen, workmen and materialmen, and other Liens
imposed by law (other than any such Lien imposed pursuant to Section 401(a)(29)
or 412(n) of the Internal Revenue Code or by ERISA), in each case incurred in
the ordinary course of business (i) for amounts not yet overdue or (ii) for
amounts that are overdue and that (in the case of any such amounts overdue for a
period in excess of five days) are being contested in good faith by appropriate
proceedings, so long as such reserves or other appropriate provisions, if any,
as shall be required by GAAP shall have been made for any such contested
amounts;

(d) Liens incurred in the ordinary course of business in connection with
workers’ compensation, unemployment insurance and other types of social
security, or to secure the performance of tenders, statutory obligations, surety
and appeal bonds, bids, leases, government contracts, trade contracts,
performance and return-of-money bonds and other similar obligations (exclusive
of obligations for the payment of borrowed money or other Indebtedness), so long
as no foreclosure, sale or similar proceedings have been commenced with respect
to any portion of the Collateral on account thereof;

(e) easements, rights-of-way, restrictions, encroachments, and other minor
defects or irregularities in title, in each case which do not and will not
interfere in any material respect with the ordinary conduct of the business of
Company or any of its Restricted Subsidiaries;

(f) any interest or title of a lessor or sublessor under any lease of real
estate permitted hereunder;

(g) Liens solely on any cash earnest money deposits made by Company or any of
its Restricted Subsidiaries in connection with any letter of intent or purchase
agreement permitted hereunder;

(h) purported Liens evidenced by the filing of precautionary UCC financing
statements relating solely to consignment of goods or operating leases of
personal property entered into in the ordinary course of business;

(i) Liens in favor of customs and revenue authorities arising as a matter of law
to secure payment of customs duties in connection with the importation of goods;

(j) any zoning or similar law or right reserved to or vested in any governmental
office or agency to control or regulate the use of any real property;

(k) licenses of patents, trademarks and other intellectual property rights
granted by Company or any of its Restricted Subsidiaries in the ordinary course
of business and not interfering in any respect with the ordinary conduct of the
business of Company or such Restricted Subsidiary;

(l) Liens described in Schedule 6.2 or on a title report delivered pursuant to
Section 3.1(i)(iv);

(m) Liens reserved in oil and gas mineral leases for bonus, royalty, or rental
payments payable to the lessor thereunder and for compliance with the terms of
such leases; provided that the amount of any obligations secured thereby that
are delinquent, that are not diligently contested in good faith and for which
adequate reserves are not maintained by Company or the applicable Restricted
Subsidiary, as the case may be, do not exceed, at any time outstanding, the
amount owing by Company or any Restricted Subsidiary, as applicable, for one
month’s payments as due thereunder;

(n) Liens arising under operating agreements, joint venture agreements,
partnership agreements, oil and gas leases, farm-out and farm-in agreements,
division orders, contracts for the sale, transportation or exchange of oil or
natural gas, unitization and pooling declarations and agreements, area of mutual
interest agreements that are customary in the Oil and Gas Business; provided
that the amount of any obligations secured thereby that are delinquent, that are
not diligently contested in good faith and for which adequate reserves are not
maintained by Company or the applicable Restricted Subsidiary, as the case may
be, do not exceed, at any time outstanding, the amount owing by Company or any
Restricted Subsidiary, as applicable, for one month’s billed operating expenses
or other expenditures attributable to such entity’s interest in the Property
covered thereby;

(o) Liens on, or related to, properties or assets to secure all or part of the
costs incurred in the ordinary course, and consistent with past practice, of the
Oil and Gas Business for the exploration, drilling, development, production,
processing, transportation, marketing, storage or operation thereof;

(p) Liens securing Indebtedness under the Senior Secured Debt Documents, the
Swap Agreements or Indebtedness permitted under Section 6.1(k); provided such
Liens are (i) subordinate to the Liens incurred hereunder and pursuant to the
Collateral Documents and (ii) subject to the Collateral Trust Agreement;

(q) Liens on cash or cash equivalents securing the Swap Agreements or
Indebtedness permitted under Section 6.1(k) to the extent that the sum of such
cash or cash equivalents constitutes the proceeds of any draw on any letter of
credit issued to secure the Swap Agreements or Indebtedness permitted under
Section 6.1(k);

(r) Liens on property (including Capital Stock) existing at the time of
acquisition of the property by Company or any Restricted Subsidiary; provided
that such Liens were in existence prior to such acquisition, and not incurred in
contemplation of, such acquisition;

(s) Liens on property of a Person existing at the time such Person is merged
with or into or consolidated with Company or any Restricted Subsidiary; provided
that such Liens were in existence prior to the contemplation of such merger or
consolidation and do not extend to any assets other than those of the Person
merged into or consolidated with Company or the Restricted Subsidiary; and

(t) Liens securing Indebtedness incurred pursuant to Section 6.1(p).

6.3 Equitable Lien. If any Credit Party or any of its Restricted Subsidiaries
shall create or assume any Lien upon any of its properties or assets, whether
now owned or hereafter acquired, other than Permitted Liens, it shall make or
cause to be made effective provisions whereby the Obligations will be secured by
such Lien equally and ratably with any and all other Indebtedness secured
thereby as long as any such Indebtedness shall be so secured; provided,
notwithstanding the foregoing, this covenant shall not be construed as a consent
by Requisite Lenders to the creation or assumption of any such Lien not
otherwise permitted hereby.

6.4 No Further Negative Pledges. Except with respect to (a) specific property
encumbered to secure payment of particular Indebtedness or to be sold pursuant
to an executed agreement with respect to a permitted asset sale,
(b) restrictions by reason of customary provisions restricting assignments,
subletting or other transfers contained in leases, licenses and similar
agreements entered into in the ordinary course of business (provided that such
restrictions are limited to the property or assets secured by such Liens or the
property or assets subject to such leases, licenses or similar agreements, as
the case may be) and (c) restrictions pursuant to the Credit Documents, the
Senior Secured Debt Documents or the Swap Agreement Documents, no Credit Party
nor any of its Restricted Subsidiaries shall enter into any agreement
prohibiting the creation or assumption of any Lien upon any of its properties or
assets, whether now owned or hereafter acquired.

6.5 Restricted Junior Payments. No Credit Party shall, nor shall it permit any
of its Restricted Subsidiaries or Affiliates through any manner or means or
through any other Person to, directly or indirectly, declare, order, pay, make
or set apart, or agree to declare, order, pay, make or set apart, any sum for
any Restricted Junior Payment except that so long as no Default exists or would
be caused thereby, and Utilization is less than 90% after giving effect to such
Restricted Junior Payment, Company may make Restricted Junior Payments.

6.6 Restrictions on Restricted Subsidiary Distributions. Except as provided
herein, no Credit Party shall, nor shall it permit any of its Restricted
Subsidiaries to, create or otherwise cause or suffer to exist or become
effective any consensual encumbrance or restriction of any kind on the ability
of any Restricted Subsidiary of Company to (a) pay dividends or make any other
distributions on any of such Restricted Subsidiary’s Capital Stock owned by
Company or any other Restricted Subsidiary of Company, (b) repay or prepay any
Indebtedness owed by such Restricted Subsidiary to Company or any other
Restricted Subsidiary of Company, (c) make loans or advances to Company or any
other Restricted Subsidiary of Company, or (d) transfer any of its property or
assets to Company or any other Restricted Subsidiary of Company other than
restrictions by reason of customary provisions restricting assignments,
subletting or other transfers contained in leases, licenses, joint venture
agreements and similar agreements entered into in the ordinary course of
business or that are or were created by virtue of any transfer of, agreement to
transfer or option or right with respect to any property, assets or Capital
Stock not otherwise prohibited under this Agreement, provided that the foregoing
shall not apply to customary restrictions or conditions imposed by (i) law or
(ii) any of the Credit Documents, Senior Secured Debt Documents or the Swap
Agreement Documents.

6.7 Investments. No Credit Party shall, nor shall it permit any of its
Restricted Subsidiaries to, directly or indirectly, make or own any Investment
in any Person, including without limitation any Joint Venture, except:

(a) Investments in Cash and Cash Equivalents;

(b) equity Investments owned as of the Closing Date in any Subsidiary and
Investments made after the Closing Date in any Guarantor;

(c) Investments (i) consisting of trade receivables arising in the ordinary
course of business and consistent with past practices, (ii) in any Securities
received in satisfaction or partial satisfaction thereof from financially
troubled account debtors and (ii) deposits, prepayments and other credits to
suppliers made in the ordinary course of business consistent with the past
practices of Company and its Restricted Subsidiaries;

(d) intercompany loans to the extent permitted under Section 6.1(b);

(e) Consolidated Capital Expenditures;

(f) loans and advances to employees of Company and its Restricted Subsidiaries
made in the ordinary course of business in an aggregate principal amount not to
exceed $2,000,000 in the aggregate outstanding at any time;

(g) Investments made in connection with Permitted Acquisitions permitted
pursuant to Section 6.9;

(h) Investments described in Schedule 6.7;

(i) Investments in any Interest Rate Agreement, Currency Agreement, or the Swap
Agreements;

(j) Permitted Business Investments; and

(k) other Investments in an aggregate amount not to exceed at any time
$10,000,000.

Notwithstanding the foregoing, in no event shall any Credit Party make any
Investment which results in or facilitates in any manner any Restricted Junior
Payment not otherwise permitted under the terms of Section 6.5.

6.8 Financial Covenants.

(a) Interest Coverage Ratio. Company shall not permit the Interest Coverage
Ratio as of the last day of any Fiscal Quarter, beginning with the Fiscal
Quarter ending September 30, 2005, to be less than 2.5 to 1.0.

(b) Leverage Ratio. Company shall not permit as of any day the Leverage Ratio
for the four Fiscal Quarters for which financial statements have most recently
been required to be delivered under this Agreement immediately preceding such
day to exceed (i) 4.5 to 1.0 through December 31, 2005; (ii) 4.25 to 1.0 from
January 1, 2006 through March 31, 2006; and (iii) 4.0 to 1.0 thereafter.

(c) Current Ratio. Company shall not permit the ratio of its current assets
(including for the purposes hereof, any Unused Revolving Commitment Amount if
the Company can meet the conditions to the making of Revolving Loans) to its
current liabilities (excluding for purposes hereof, any current maturities of
Revolving Loans) as of the last day of any Fiscal Quarter, beginning with the
Fiscal Quarter ending September 30, 2005, to be less than 1.0 to 1.0. For
purposes of this Section, current liabilities and current assets shall exclude
any liability or asset representing a valuation account arising from the
application of SFAS 133 and 143, and any deferred taxes attributable thereto.

(d) [Reserved].

(e) [Reserved].

(f) [Reserved].

(g) [Reserved].

(h) Certain Calculations. With respect to any period during which a Permitted
Acquisition or an Asset Sale has occurred (each, a “Subject Transaction”), for
purposes of determining compliance with the financial covenants set forth in
this Section 6.8, Consolidated Adjusted EBITDA and Consolidated EBITDAX shall be
calculated with respect to such period on a pro forma basis (including pro forma
adjustments arising out of events which are directly attributable to a specific
transaction, are factually supportable and are expected to have a continuing
impact, in each case determined on a basis consistent with Article 11 of
Regulation S-X promulgated under the Securities Act and as interpreted by the
staff of the Securities and Exchange Commission, which would include cost
savings resulting from head count reduction, closure of facilities and similar
restructuring charges, which pro forma adjustments shall be certified by the
chief financial officer of Company) using the historical audited financial
statements of any business so acquired or to be acquired or sold or to be sold
and the consolidated financial statements of Company and its Subsidiaries which
shall be reformulated as if such Subject Transaction, and any Indebtedness
incurred or repaid in connection therewith, had been consummated or incurred or
repaid at the beginning of such period (and assuming that such Indebtedness
bears interest during any portion of the applicable measurement period prior to
the relevant acquisition at the weighted average of the interest rates
applicable to outstanding Loans incurred during such period).

6.9 Fundamental Changes; Disposition of Assets; Acquisitions. No Credit Party
shall, nor shall it permit any of its Restricted Subsidiaries to, enter into any
transaction of merger or consolidation, or liquidate, wind-up or dissolve itself
(or suffer any liquidation or dissolution), or convey, sell, lease or sub-lease
(as lessor or sublessor), exchange, transfer or otherwise dispose of, in one
transaction or a series of transactions, all or any part of its business, assets
or property of any kind whatsoever, whether real, personal or mixed and whether
tangible or intangible, whether now owned or hereafter acquired, or acquire by
purchase or otherwise (other than purchases or other acquisitions of inventory,
materials and equipment and Consolidated Capital Expenditures in the ordinary
course of business) all or substantially all of the business, property or fixed
assets of, or stock or other evidence of beneficial ownership of, any Person or
any division or line of business or other business unit of any Person, except:

(a) any Restricted Subsidiary of Company may be merged with or into Company or
any Guarantor, or be liquidated, wound up or dissolved, or all or any part of
its business, property or assets may be conveyed, sold, leased, transferred or
otherwise disposed of, in one transaction or a series of transactions, to
Company or any Guarantor; provided, in the case of such a merger, Company or
such Guarantor, as applicable shall be the continuing or surviving Person;

(b) sales or other dispositions of assets that do not constitute Asset Sales;

(c) Asset Sales, the proceeds of which (valued at the principal amount thereof
in the case of non-Cash proceeds consisting of notes or other debt Securities
and valued at fair market value in the case of other non-Cash proceeds) (i) are
less than $5,000,000 with respect to any single Asset Sale or series of related
Asset Sales and (ii) when aggregated with the proceeds of all other Asset Sales
made within the same Fiscal Year, are less than $10,000,000; provided (1) the
consideration received for such assets shall be in an amount at least equal to
the fair market value thereof (determined in good faith by a Financial Officer
of Company) and (2) no less than 75% thereof shall be paid in Cash

(d) disposals of obsolete, worn out or surplus property;

(e) Permitted Acquisitions, provided, that in connection with any Permitted
Acquisition, any Restricted Subsidiary of Company may be merged with or into any
company acquired in such Permitted Acquisition so long as such Guarantor shall
be the continuing or surviving Person;

(f) the sale of (i) Oil and Gas Properties, Real Estate Assets and other related
assets and property constituting the Company’s coalbed methane properties and
acreage in Pennsylvania, and (ii) other Oil and Gas Properties not containing
Proven Reserves in the ordinary course of business; provided, that, the
aggregate value of Oil and Gas Properties so abandoned, farmed-out or subleased
pursuant to this clause (ii) during any six-month period commencing January 1
and ending June 30 or commencing July 1 and ending December 31 shall not exceed
$5,000,000;

(g) the trade or exchange by Company or any Restricted Subsidiary of any Oil and
Gas Property or interest therein owned or held by Company or such Restricted
Subsidiary for any Oil and Gas Property or interest therein owned or held by
another Person, including any cash or Cash Equivalents necessary in order to
achieve an exchange of equivalent value; provided, that, the aggregate value of
trades or exchanges permitted by this paragraph (g) shall not exceed $5,000,000
during any six-month period commencing January 1 and ending June 30 or
commencing July 1 and ending December 31;

(h) the sale of Oil and Gas Properties in connection with tax credit
transactions complying with Section 29 of the Internal Revenue of 1986, as
amended from time to time (“Section 29 Properties”), which sale does not result
in a reduction in Company’s or its Restricted Subsidiaries’, as the case may be,
right to receive the cash flow from such Oil and Gas Properties through the
Revolving Loan Maturity Date and which sale is on terms reasonably acceptable to
the Administrative Agent; and

(i) Investments made in accordance with Section 6.7.

6.10 Disposal of Subsidiary Interests. Except for (i) any sale of all of its
interests in the Capital Stock of any of its Subsidiaries in compliance with the
provisions of Section 6.9 and (ii) any pledge of the Capital Stock of Company or
its Subsidiaries to secure the Obligations hereunder or the Obligations under
the Senior Secured Notes or any Swap Agreement, no Credit Party shall, nor shall
it permit any of its Restricted Subsidiaries to, (a) directly or indirectly
sell, assign, pledge or otherwise encumber or dispose of any Capital Stock of
any of its Restricted Subsidiaries, except to qualify directors if required by
applicable law; or (b) permit any of its Restricted Subsidiaries directly or
indirectly to sell, assign, pledge or otherwise encumber or dispose of any
Capital Stock of any of its Restricted Subsidiaries, except to another Credit
Party (subject to the restrictions on such disposition otherwise imposed
hereunder), or to qualify directors if required by applicable law.

6.11 Sales and Lease-Backs. No Credit Party shall, nor shall it permit any of
its Restricted Subsidiaries to, directly or indirectly, become or remain liable
as lessee or as a guarantor or other surety with respect to any lease of any
property (whether real, personal or mixed), whether now owned or hereafter
acquired, which such Credit Party (a) has sold or transferred or is to sell or
to transfer to any other Person (other than Company or any of its Restricted
Subsidiaries), or (b) intends to use for substantially the same purpose as any
other property which has been or is to be sold or transferred by such Credit
Party to any Person (other than Company or any of its Restricted Subsidiaries)
in connection with such lease.

6.12 Transactions with Shareholders and Affiliates. No Credit Party shall, nor
shall it permit any of its Restricted Subsidiaries to, directly or indirectly,
enter into or permit to exist any transaction (including the purchase, sale,
lease or exchange of any property or the rendering of any service) with any
holder of 10% or more of any class of Capital Stock of Company or any of its
Restricted Subsidiaries or with any Affiliate of Company or of any such holder,
on terms that are less favorable to Company or that Restricted Subsidiary, as
the case may be, than those that might be obtained at the time from a Person who
is not such a holder or Affiliate; provided, the foregoing restriction shall not
apply to (a) any transaction between Company and any Guarantor; (b) reasonable
and customary fees paid to members of the board of directors (or similar
governing body) of Company and its Restricted Subsidiaries; (c) compensation
arrangements for officers and other employees of Company and its Restricted
Subsidiaries entered into in the ordinary course of business; and
(d) transactions described in Schedule 6.12.

6.13 Conduct of Business. From and after the Closing Date, no Credit Party
shall, nor shall it permit any of its Subsidiaries to, engage in any business
other than (i) Oil and Gas Business, and (ii) such other lines of business as
may be consented to by Requisite Lenders.

6.14 Forward Sales. Except in accordance with ordinary practice in the Oil and
Gas Business, enter into or permit to exist any advance payment agreement or
other arrangement pursuant to which Company or any of its Restricted
Subsidiaries, having received full or substantial payment of the purchase price
for a specified quantity of Hydrocarbons upon entering such agreement or
arrangement, is required to deliver, in one or more installments subsequent to
the date of such agreement or arrangement, such quantity of Hydrocarbons
pursuant to and during the terms of such agreement or arrangement; provided that
any Production Payment is prohibited without the consent of the Requisite
Lenders, except for those certain Volumetric Production Payments to be made
under the terms of that certain Agreement of Limited Partnership of Blue Spruce
Investments Limited partnership dated as of September 1, 1993..

6.15 Amendments or Waivers of Certain Related Agreements. No Credit Party shall
nor shall it permit any of its Restricted Subsidiaries to, agree to any material
amendment, restatement, supplement or other modification to, or waiver of, any
of its material rights under any Related Agreement (other than the Senior
Secured Indebtedness and future transactions otherwise permitted by the terms of
this Agreement) after the Closing Date without in each case obtaining the prior
written consent of Requisite Lenders to such amendment, restatement, supplement
or other modification or waiver.

6.16 Amendments or Waivers of with respect to Senior Secured Indebtedness. No
Credit Party shall, nor shall it permit any of its Restricted Subsidiaries to,
amend or otherwise change the terms of any Senior Secured Indebtedness, or make
any payment consistent with an amendment thereof or change thereto, except for
the amendments and changes contemplated by the Tender Offer and any other
amendments or changes if the effect of such amendment or change does not
(i) increase the interest rate on such Senior Secured Indebtedness, (ii) change
(to earlier dates) any dates upon which payments of principal or interest are
due thereon, (iii) change any event of default or condition to an event of
default with respect thereto (other than to eliminate any such event of default
or increase any grace period related thereto), or (iv) change the redemption,
prepayment or defeasance provisions thereof, or change the lien subordination
provisions of such Senior Secured Indebtedness (or of any guaranty thereof), in
each case which, together with all other amendments or changes made, results in
a material increase in the obligations of the obligors thereunder or confers any
additional rights on the holders of such Senior Secured Indebtedness (or a
trustee or other representative on their behalf) which could reasonably be
expected to be adverse in any material respect to any Credit Party or Lenders.

6.17 Fiscal Year. No Credit Party shall, nor shall it permit any of its
Subsidiaries to change its Fiscal Year-end from December 31.

SECTION 7 GUARANTY

7.1 Guaranty of the Obligations. Subject to the provisions of Section 7.2,
Guarantors jointly and severally hereby irrevocably and unconditionally guaranty
to Administrative Agent for the ratable benefit of the Beneficiaries the due and
punctual payment in full of all Obligations when the same shall become due,
whether at stated maturity, by required prepayment, declaration, acceleration,
demand or otherwise (including amounts that would become due but for the
operation of the automatic stay under Section 362(a) of the Bankruptcy Code, 11
U.S.C. § 362(a)) (collectively, the “Guaranteed Obligations”).

7.2 Contribution by Guarantors. All Guarantors desire to allocate among
themselves (collectively, the “Contributing Guarantors”), in a fair and
equitable manner, their obligations arising under this Guaranty. Accordingly, in
the event any payment or distribution is made on any date by a Guarantor (a
“Funding Guarantor”) under this Guaranty such that its Aggregate Payments
exceeds its Fair Share as of such date, such Funding Guarantor shall be entitled
to a contribution from each of the other Contributing Guarantors in an amount
sufficient to cause each Contributing Guarantor’s Aggregate Payments to equal
its Fair Share as of such date. “Fair Share” means, with respect to a
Contributing Guarantor as of any date of determination, an amount equal to
(a) the ratio of (i) the Fair Share Contribution Amount with respect to such
Contributing Guarantor to (ii) the aggregate of the Fair Share Contribution
Amounts with respect to all Contributing Guarantors multiplied by (b) the
aggregate amount paid or distributed on or before such date by all Funding
Guarantors under this Guaranty in respect of the obligations Guaranteed. “Fair
Share Contribution Amount” means, with respect to a Contributing Guarantor as of
any date of determination, the maximum aggregate amount of the obligations of
such Contributing Guarantor under this Guaranty that would not render its
obligations hereunder or thereunder subject to avoidance as a fraudulent
transfer or conveyance under Section 548 of Title 11 of the United States Code
or any comparable applicable provisions of state law; provided, solely for
purposes of calculating the “Fair Share Contribution Amount” with respect to any
Contributing Guarantor for purposes of this Section 7.2, any assets or
liabilities of such Contributing Guarantor arising by virtue of any rights to
subrogation, reimbursement or indemnification or any rights to or obligations of
contribution hereunder shall not be considered as assets or liabilities of such
Contributing Guarantor. "Aggregate Payments” means, with respect to a
Contributing Guarantor as of any date of determination, an amount equal to
(1) the aggregate amount of all payments and distributions made on or before
such date by such Contributing Guarantor in respect of this Guaranty (including,
without limitation, in respect of this Section 7.2), minus (2) the aggregate
amount of all payments received on or before such date by such Contributing
Guarantor from the other Contributing Guarantors as contributions under this
Section 7.2. The amounts payable as contributions hereunder shall be determined
as of the date on which the related payment or distribution is made by the
applicable Funding Guarantor. The allocation among Contributing Guarantors of
their obligations as set forth in this Section 7.2 shall not be construed in any
way to limit the liability of any Contributing Guarantor hereunder. Each
Guarantor is a third party beneficiary to the contribution agreement set forth
in this Section 7.2.

7.3 Payment by Guarantors. Subject to Section 7.2, Guarantors hereby jointly and
severally agree, in furtherance of the foregoing and not in limitation of any
other right which any Beneficiary may have at law or in equity against any
Guarantor by virtue hereof, that upon the failure of Company to pay any of the
Guaranteed Obligations when and as the same shall become due, whether at stated
maturity, by required prepayment, declaration, acceleration, demand or otherwise
(including amounts that would become due but for the operation of the automatic
stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. § 362(a)),
Guarantors will upon demand pay, or cause to be paid, in Cash, to Administrative
Agent for the ratable benefit of Beneficiaries, an amount equal to the sum of
the unpaid principal amount of all Guaranteed Obligations then due as aforesaid,
accrued and unpaid interest on such Guaranteed Obligations (including interest
which, but for Company’s becoming the subject of a case under the Bankruptcy
Code, would have accrued on such Guaranteed Obligations, whether or not a claim
is allowed against Company for such interest in the related bankruptcy case) and
all other Guaranteed Obligations then owed to Beneficiaries as aforesaid.

7.4 Liability of Guarantors Absolute. Each Guarantor agrees that its obligations
hereunder are irrevocable, absolute, independent and unconditional and shall not
be affected by any circumstance which constitutes a legal or equitable discharge
of a guarantor or surety other than payment in full of the Guaranteed
Obligations. In furtherance of the foregoing and without limiting the generality
thereof, each Guarantor agrees as follows:

(a) this Guaranty is a guaranty of payment when due and not of collectability.
This Guaranty is a primary obligation of each Guarantor and not merely a
contract of surety;

(b) Administrative Agent may enforce this Guaranty upon the occurrence of an
Event of Default notwithstanding the existence of any dispute between Company
and any Beneficiary with respect to the existence of such Event of Default;

(c) the obligations of each Guarantor hereunder are independent of the
obligations of Company and the obligations of any other guarantor (including any
other Guarantor) of the obligations of Company, and a separate action or actions
may be brought and prosecuted against such Guarantor whether or not any action
is brought against Company or any of such other guarantors and whether or not
Company is joined in any such action or actions;

(d) payment by any Guarantor of a portion, but not all, of the Guaranteed
Obligations shall in no way limit, affect, modify or abridge any Guarantor’s
liability for any portion of the Guaranteed Obligations which has not been paid.
Without limiting the generality of the foregoing, if Administrative Agent is
awarded a judgment in any suit brought to enforce any Guarantor’s covenant to
pay a portion of the Guaranteed Obligations, such judgment shall not be deemed
to release such Guarantor from its covenant to pay the portion of the Guaranteed
Obligations that is not the subject of such suit, and such judgment shall not,
except to the extent satisfied by such Guarantor, limit, affect, modify or
abridge any other Guarantor’s liability hereunder in respect of the Guaranteed
Obligations;

(e) any Beneficiary, upon such terms as it deems appropriate, without notice or
demand and without affecting the validity or enforceability hereof or giving
rise to any reduction, limitation, impairment, discharge or termination of any
Guarantor’s liability hereunder, from time to time may (i) renew, extend,
accelerate, increase the rate of interest on, or otherwise change the time,
place, manner or terms of payment of the Guaranteed Obligations; (ii) settle,
compromise, release or discharge, or accept or refuse any offer of performance
with respect to, or substitutions for, the Guaranteed Obligations or any
agreement relating thereto and/or subordinate the payment of the same to the
payment of any other obligations; (iii) request and accept other guaranties of
the Guaranteed Obligations and take and hold security for the payment hereof or
the Guaranteed Obligations; (iv) release, surrender, exchange, substitute,
compromise, settle, rescind, waive, alter, subordinate or modify, with or
without consideration, any security for payment of the Guaranteed Obligations,
any other guaranties of the Guaranteed Obligations, or any other obligation of
any Person (including any other Guarantor) with respect to the Guaranteed
Obligations; (v) enforce and apply any security now or hereafter held by or for
the benefit of such Beneficiary in respect hereof or the Guaranteed Obligations
and direct the order or manner of sale thereof, or exercise any other right or
remedy that such Beneficiary may have against any such security, in each case as
such Beneficiary in its discretion may determine consistent herewith or the
applicable Hedge Agreement and any applicable security agreement, including
foreclosure on any such security pursuant to one or more judicial or nonjudicial
sales, whether or not every aspect of any such sale is commercially reasonable,
and even though such action operates to impair or extinguish any right of
reimbursement or subrogation or other right or remedy of any Guarantor against
Company or any security for the Guaranteed Obligations; and (vi) exercise any
other rights available to it under the Credit Documents or the Hedge Agreements;
and

(f) this Guaranty and the obligations of Guarantors hereunder shall be valid and
enforceable and shall not be subject to any reduction, limitation, impairment,
discharge or termination for any reason (other than payment in full of the
Guaranteed Obligations), including the occurrence of any of the following,
whether or not any Guarantor shall have had notice or knowledge of any of them:
(i) any failure or omission to assert or enforce or agreement or election not to
assert or enforce, or the stay or enjoining, by order of court, by operation of
law or otherwise, of the exercise or enforcement of, any claim or demand or any
right, power or remedy (whether arising under the Credit Documents or the Hedge
Agreements, at law, in equity or otherwise) with respect to the Guaranteed
Obligations or any agreement relating thereto, or with respect to any other
guaranty of or security for the payment of the Guaranteed Obligations; (ii) any
rescission, waiver, amendment or modification of, or any consent to departure
from, any of the terms or provisions (including provisions relating to events of
default) hereof, any of the other Credit Documents, any of the Hedge Agreements
or any agreement or instrument executed pursuant thereto, or of any other
guaranty or security for the Guaranteed Obligations, in each case whether or not
in accordance with the terms hereof or such Credit Document, such Hedge
Agreement or any agreement relating to such other guaranty or security;
(iii) the Guaranteed Obligations, or any agreement relating thereto, at any time
being found to be illegal, invalid or unenforceable in any respect; (iv) the
application of payments received from any source (other than payments received
pursuant to the other Credit Documents or any of the Hedge Agreements or from
the proceeds of any security for the Guaranteed Obligations, except to the
extent such security also serves as collateral for indebtedness other than the
Guaranteed Obligations) to the payment of indebtedness other than the Guaranteed
Obligations, even though any Beneficiary might have elected to apply such
payment to any part or all of the Guaranteed Obligations; (v) any Beneficiary’s
consent to the change, reorganization or termination of the corporate structure
or existence of Company or any of its Subsidiaries and to any corresponding
restructuring of the Guaranteed Obligations; (vi) any failure to perfect or
continue perfection of a security interest in any collateral which secures any
of the Guaranteed Obligations; (vii) any defenses, set-offs or counterclaims
which Company may allege or assert against any Beneficiary in respect of the
Guaranteed Obligations, including failure of consideration, breach of warranty,
payment, statute of frauds, statute of limitations, accord and satisfaction and
usury; and (viii) any other act or thing or omission, or delay to do any other
act or thing, which may or might in any manner or to any extent vary the risk of
any Guarantor as an obligor in respect of the Guaranteed Obligations.

7.5 Waivers by Guarantors. Each Guarantor hereby waives, for the benefit of
Beneficiaries: (a) any right to require any Beneficiary, as a condition of
payment or performance by such Guarantor, to (i) proceed against Company, any
other guarantor (including any other Guarantor) of the Guaranteed Obligations or
any other Person, (ii) proceed against or exhaust any security held from
Company, any such other guarantor or any other Person, (iii) proceed against or
have resort to any balance of any Deposit Account or credit on the books of any
Beneficiary in favor of Company or any other Person, or (iv) pursue any other
remedy in the power of any Beneficiary whatsoever; (b) any defense arising by
reason of the incapacity, lack of authority or any disability or other defense
of Company or any other Guarantor including any defense based on or arising out
of the lack of validity or the unenforceability of the Guaranteed Obligations or
any agreement or instrument relating thereto or by reason of the cessation of
the liability of Company or any other Guarantor from any cause other than
payment in full of the Guaranteed Obligations; (c) any defense based upon any
statute or rule of law which provides that the obligation of a surety must be
neither larger in amount nor in other respects more burdensome than that of the
principal; (d) any defense based upon any Beneficiary’s errors or omissions in
the administration of the Guaranteed Obligations, except behavior which amounts
to bad faith; (e) (i) any principles or provisions of law, statutory or
otherwise, which are or might be in conflict with the terms hereof and any legal
or equitable discharge of such Guarantor’s obligations hereunder, (ii) to the
extent permitted by law, the benefit of any statute of limitations affecting
such Guarantor’s liability hereunder or the enforcement hereof, (iii) any rights
to set-offs, recoupments and counterclaims, and (iv) promptness, diligence and
any requirement that any Beneficiary protect, secure, perfect or insure any
security interest or lien or any property subject thereto; (f) notices, demands,
presentments, protests, notices of protest, notices of dishonor and notices of
any action or inaction, including acceptance hereof, notices of default
hereunder, the Hedge Agreements or any agreement or instrument related thereto,
notices of any renewal, extension or modification of the Guaranteed Obligations
or any agreement related thereto, notices of any extension of credit to Company
and notices of any of the matters referred to in Section 7.4 and any right to
consent to any thereof; and (g) any defenses or benefits that may be derived
from or afforded by law which limit the liability of or exonerate guarantors or
sureties, or which may conflict with the terms hereof.

7.6 Guarantors’ Rights of Subrogation, Contribution, etc. Until the Guaranteed
Obligations shall have been indefeasibly paid in full and the Revolving
Commitments shall have terminated and all Letters of Credit and Hedge Letters of
Credit shall have expired or been cancelled, each Guarantor hereby waives any
claim, right or remedy, direct or indirect, that such Guarantor now has or may
hereafter have against Company or any other Guarantor or any of its assets in
connection with this Guaranty or the performance by such Guarantor of its
obligations hereunder, in each case whether such claim, right or remedy arises
in equity, under contract, by statute, under common law or otherwise and
including without limitation (a) any right of subrogation, reimbursement or
indemnification that such Guarantor now has or may hereafter have against
Company with respect to the Guaranteed Obligations, (b) any right to enforce, or
to participate in, any claim, right or remedy that any Beneficiary now has or
may hereafter have against Company, and (c) any benefit of, and any right to
participate in, any collateral or security now or hereafter held by any
Beneficiary. In addition, until the Guaranteed Obligations shall have been
indefeasibly paid in full and the Revolving Commitments shall have terminated
and all Letters of Credit and Hedge Letters of Credit shall have expired or been
cancelled, each Guarantor shall withhold exercise of any right of contribution
such Guarantor may have against any other guarantor (including any other
Guarantor) of the Guaranteed Obligations, including, without limitation, any
such right of contribution as contemplated by Section 7.2. Each Guarantor
further agrees that, to the extent the waiver or agreement to withhold the
exercise of its rights of subrogation, reimbursement, indemnification and
contribution as set forth herein is found by a court of competent jurisdiction
to be void or voidable for any reason, any rights of subrogation, reimbursement
or indemnification such Guarantor may have against Company or against any
collateral or security, and any rights of contribution such Guarantor may have
against any such other guarantor, shall be junior and subordinate to any rights
any Beneficiary may have against Company, to all right, title and interest any
Beneficiary may have in any such collateral or security, and to any right any
Beneficiary may have against such other guarantor. If any amount shall be paid
to any Guarantor on account of any such subrogation, reimbursement,
indemnification or contribution rights at any time when all Guaranteed
Obligations shall not have been finally and indefeasibly paid in full, such
amount shall be held in trust for Administrative Agent on behalf of
Beneficiaries and shall forthwith be paid over to Administrative Agent for the
benefit of Beneficiaries to be credited and applied against the Guaranteed
Obligations, whether matured or unmatured, in accordance with the terms hereof.

7.7 Subordination of Other Obligations. Any Indebtedness of Company or any
Guarantor now or hereafter held by any Guarantor (the “Obligee Guarantor”) is
hereby subordinated in right of payment to the Guaranteed Obligations, and any
such indebtedness collected or received by the Obligee Guarantor after an Event
of Default has occurred and is continuing shall be held in trust for
Administrative Agent on behalf of Beneficiaries and shall forthwith be paid over
to Administrative Agent for the benefit of Beneficiaries to be credited and
applied against the Guaranteed Obligations but without affecting, impairing or
limiting in any manner the liability of the Obligee Guarantor under any other
provision hereof.

7.8 Continuing Guaranty. This Guaranty is a continuing guaranty and shall remain
in effect until all of the Guaranteed Obligations shall have been paid in full
and the Revolving Commitments shall have terminated and all Letters of Credit
and Hedge Letters of Credit shall have expired or been cancelled. Each Guarantor
hereby irrevocably waives any right to revoke this Guaranty as to future
transactions giving rise to any Guaranteed Obligations.

7.9 Authority of Guarantors or Company. It is not necessary for any Beneficiary
to inquire into the capacity or powers of any Guarantor or Company or the
officers, directors or any agents acting or purporting to act on behalf of any
of them.

7.10 Financial Condition of Company. Any Credit Extension may be made to Company
or continued from time to time, and any Hedge Agreements may be entered into
from time to time, in each case without notice to or authorization from any
Guarantor regardless of the financial or other condition of Company at the time
of any such grant or continuation or at the time such Hedge Agreement is entered
into, as the case may be. No Beneficiary shall have any obligation to disclose
or discuss with any Guarantor its assessment, or any Guarantor’s assessment, of
the financial condition of Company. Each Guarantor has adequate means to obtain
information from Company on a continuing basis concerning the financial
condition of Company and its ability to perform its obligations under the Credit
Documents and the Hedge Agreements, and each Guarantor assumes the
responsibility for being and keeping informed of the financial condition of
Company and of all circumstances bearing upon the risk of nonpayment of the
Guaranteed Obligations. Each Guarantor hereby waives and relinquishes any duty
on the part of any Beneficiary to disclose any matter, fact or thing relating to
the business, operations or conditions of Company now known or hereafter known
by any Beneficiary.

7.11 Bankruptcy, etc. So long as any Guaranteed Obligations remain outstanding,
no Guarantor shall, without the prior written consent of Administrative Agent
acting pursuant to the instructions of Requisite Lenders, commence or join with
any other Person in commencing any bankruptcy, reorganization or insolvency case
or proceeding of or against Company or any other Guarantor. The obligations of
Guarantors hereunder shall not be reduced, limited, impaired, discharged,
deferred, suspended or terminated by any case or proceeding, voluntary or
involuntary, involving the bankruptcy, insolvency, receivership, reorganization,
liquidation or arrangement of Company or any other Guarantor or by any defense
which Company or any other Guarantor may have by reason of the order, decree or
decision of any court or administrative body resulting from any such proceeding.

(a) Each Guarantor acknowledges and agrees that any interest on any portion of
the Guaranteed Obligations which accrues after the commencement of any case or
proceeding referred to in clause (a) above (or, if interest on any portion of
the Guaranteed Obligations ceases to accrue by operation of law by reason of the
commencement of such case or proceeding, such interest as would have accrued on
such portion of the Guaranteed Obligations if such case or proceeding had not
been commenced) shall be included in the Guaranteed Obligations because it is
the intention of Guarantors and Beneficiaries that the Guaranteed Obligations
which are guaranteed by Guarantors pursuant hereto should be determined without
regard to any rule of law or order which may relieve Company of any portion of
such Guaranteed Obligations. Guarantors will permit any trustee in bankruptcy,
receiver, debtor in possession, assignee for the benefit of creditors or similar
person to pay Administrative Agent, or allow the claim of Administrative Agent
in respect of, any such interest accruing after the date on which such case or
proceeding is commenced.

(b) In the event that all or any portion of the Guaranteed Obligations are paid
by Company, the obligations of Guarantors hereunder shall continue and remain in
full force and effect or be reinstated, as the case may be, in the event that
all or any part of such payment(s) are rescinded or recovered directly or
indirectly from any Beneficiary as a preference, fraudulent transfer or
otherwise, and any such payments which are so rescinded or recovered shall
constitute Guaranteed Obligations for all purposes hereunder.

7.12 Discharge of Guaranty Upon Sale of Guarantor. If all of the Capital Stock
of any Guarantor or any of its successors in interest hereunder shall be sold or
otherwise disposed of (including by merger or consolidation) in accordance with
the terms and conditions hereof, the Guaranty of such Guarantor or such
successor in interest, as the case may be, hereunder shall automatically be
discharged and released without any further action by any Beneficiary or any
other Person effective as of the time of such Asset Sale.

Notwithstanding anything herein to the contrary, each Guarantor confirms that it
is its intention that the guaranty by such Guarantor pursuant to this Guaranty
not constitute a fraudulent transfer or conveyance for purposes of any federal,
state or foreign law. To effectuate the foregoing intention, each Guarantor
hereby irrevocably agrees that the obligations of each Guarantor under this
Guaranty shall be limited to the maximum amount as will, after giving effect to
all other contingent and fixed liabilities of such Guarantor and after giving
effect to any collections from payments made by or on behalf of any other
Guarantor in respect of the obligations of such other Guarantor under its
Guaranty, result in the obligations of such Guarantor under this Guaranty not
constituting a fraudulent conveyance or fraudulent transfer under federal, state
or foreign law.

SECTION 8 EVENTS OF DEFAULT

8.1 Events of Default. If any one or more of the following conditions or events
shall occur:

(a) Failure to Make Payments When Due. Failure by Company to pay (i) when due
any installment of principal of any Loan, whether at stated maturity, by
acceleration, by notice of voluntary prepayment, by mandatory prepayment or
otherwise; (ii) when due any amount payable to Issuing Bank in reimbursement of
any drawing under a Letter of Credit or Hedge Letter of Credit; or (iii) any
interest on any Loan or any fee or any other amount due hereunder within five
days after the date due; or

(b) Default in Other Agreements. (i) Failure of any Credit Party or any of their
respective Restricted Subsidiaries to pay when due any principal of or interest
on or any other amount payable in respect of one or more items of Indebtedness
(other than Indebtedness referred to in Section 8.1(a)) in a principal amount of
$10,000,000 or more beyond the grace period, if any, provided therefor; or
(ii) breach or default by any Credit Party with respect to any other material
term of (1) one or more items of Indebtedness in the principal amounts referred
to in clause (i) above or (2) any loan agreement, mortgage, indenture or other
agreement relating to such item(s) of Indebtedness, in each case beyond the
grace period, if any, provided therefor, if the effect of such breach or default
is to cause, or to permit the holder or holders of that Indebtedness (or a
trustee on behalf of such holder or holders), to cause, that Indebtedness to
become or be declared due and payable (or redeemable) prior to its stated
maturity or the stated maturity of any underlying obligation, as the case may
be; or (iii) breach or default by Company under the J. Aron Swap or any other
material Swap Agreement, if the effect of such breach or default is to permit
the holder or holders of that Indebtedness to terminate the J. Aron Swap or any
other material Swap Agreement, and all or substantially all of the outstanding
transactions thereunder; or

(c) Breach of Certain Covenants. Failure of any Credit Party to perform or
comply with any term or condition contained in Section 2.6, Section 5.2 (as to
the existence of any Credit Party) or Section 6; or

(d) Breach of Representations, etc. Any representation, warranty, certification
or other statement made or deemed made by any Credit Party in any Credit
Document or in any statement or certificate at any time given by any Credit
Party or any of its Subsidiaries in writing pursuant hereto or thereto or in
connection herewith or therewith shall be false in any material respect as of
the date made or deemed made; or

(e) Other Defaults Under Credit Documents. Any Credit Party shall default in the
performance of or compliance with any term contained herein or any of the other
Credit Documents, other than any such term referred to in any other Section of
this Section 8.1, and such default shall not have been remedied or waived within
thirty days after the earlier of (i) an officer of such Credit Party becoming
aware of such default or (ii) receipt by Company of notice from Administrative
Agent or any Lender of such default; or

(f) Involuntary Bankruptcy; Appointment of Receiver, etc. (i) A court of
competent jurisdiction shall enter a decree or order for relief in respect of
Company or any of its Subsidiaries in an involuntary case under the Bankruptcy
Code or under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, which decree or order is not stayed; or any other similar
relief shall be granted under any applicable federal or state law; or (ii) an
involuntary case shall be commenced against Company or any of its Subsidiaries
under the Bankruptcy Code or under any other applicable bankruptcy, insolvency
or similar law now or hereafter in effect; or a decree or order of a court
having jurisdiction in the premises for the appointment of a receiver,
liquidator, sequestrator, trustee, custodian or other officer having similar
powers over Company or any of its Subsidiaries, or over all or a substantial
part of its property, shall have been entered; or there shall have occurred the
involuntary appointment of an interim receiver, trustee or other custodian of
Company or any of its Subsidiaries for all or a substantial part of its
property; or a warrant of attachment, execution or similar process shall have
been issued against any substantial part of the property of Company or any of
its Subsidiaries, and any such event described in this clause (ii) shall
continue for sixty days without having been dismissed, bonded or discharged; or

(g) Voluntary Bankruptcy; Appointment of Receiver, etc. (i) Company or any of
its Subsidiaries shall have an order for relief entered with respect to it or
shall commence a voluntary case under the Bankruptcy Code or under any other
applicable bankruptcy, insolvency or similar law now or hereafter in effect, or
shall consent to the entry of an order for relief in an involuntary case, or to
the conversion of an involuntary case to a voluntary case, under any such law,
or shall consent to the appointment of or taking possession by a receiver,
trustee or other custodian for all or a substantial part of its property; or
Company or any of its Subsidiaries shall make any assignment for the benefit of
creditors; or (ii) Company or any of its Subsidiaries shall be unable, or shall
fail generally, or shall admit in writing its inability, to pay its debts as
such debts become due; or the board of directors (or similar governing body) of
Company or any of its Subsidiaries (or any committee thereof) shall adopt any
resolution or otherwise authorize any action to approve any of the actions
referred to herein or in Section 8.1(f); or

(h) Judgments and Attachments. Any money judgment, writ or warrant of attachment
or similar process involving (i) in any individual case an amount in excess of
$3,000,000 or (ii) in the aggregate at any time an amount in excess of
$10,000,000 (in either case to the extent not adequately covered by insurance as
to which a solvent and unaffiliated insurance company has acknowledged coverage)
shall be entered or filed against Company or any of its Subsidiaries or any of
their respective assets and shall remain undischarged, unvacated, unbonded or
unstayed for a period of 60 days (or in any event later than five days prior to
the date of any proposed sale thereunder); or

(i) Dissolution. Any order, judgment or decree shall be entered against any
Credit Party decreeing the dissolution or split up of such Credit Party and such
order shall remain undischarged or unstayed for a period in excess of 30 days;
or

(j) Employee Benefit Plans. (i) There shall occur one or more ERISA Events which
individually or in the aggregate results in or might reasonably be expected to
result in liability of Company, any of its Subsidiaries or any of their
respective ERISA Affiliates in excess of $10,000,000 during the term hereof; or
(ii) there exists any fact or circumstance that reasonably could be expected to
result in the imposition of a Lien or security interest under Section 412(n) of
the Internal Revenue Code or under ERISA; or

(k) Change of Control. A Change of Control shall occur; or

(l) Guaranties, Collateral Documents and other Credit Documents. At any time
after the execution and delivery thereof, (i) the Guaranty for any reason, other
than the satisfaction in full of all Obligations, shall cease to be in full
force and effect (other than in accordance with its terms) or shall be declared
to be null and void or any Guarantor shall repudiate its obligations thereunder,
(ii) this Agreement or any Collateral Document ceases to be in full force and
effect (other than by reason of a release of Collateral in accordance with the
terms hereof or thereof or the satisfaction in full of the Obligations in
accordance with the terms hereof) or shall be declared null and void, or
Collateral Trustee shall not have or shall cease to have a valid and perfected
Lien in any Collateral purported to be covered by the Collateral Documents with
the priority required by the relevant Collateral Document, in each case for any
reason other than the failure of Collateral Trustee or any Secured Party to take
any action within its control, or (iii) any Credit Party shall contest the
validity or enforceability of any Credit Document in writing or deny in writing
that it has any further liability, including with respect to future advances by
Lenders, under any Credit Document to which it is a party; or

(m) Subordination. The lien subordination provisions contained in the Collateral
Trust Agreement shall cease, for any reason, to be in full force and effect, or
any Person that is a party thereto or holders of at least 25% of the aggregate
principal amount of the Senior Secured Notes shall so assert; or

(n) Borrowing Base. Any failure to cure any Borrowing Base deficiency in
accordance with Section 2.14(a);

THEN, (1) upon the occurrence of any Event of Default described in
Section 8.1(f) or 8.1(g), automatically, and (2) upon the occurrence of any
other Event of Default, at the request of (or with the consent of) Requisite
Lenders, upon notice to Company by Administrative Agent, (A) the Revolving
Commitments, if any, of each Lender having such Revolving Commitments and the
obligation of Issuing Bank to issue any Letter of Credit shall immediately
terminate; (B) the Hedge L/C Commitments, if any, of each Lender having such
Hedge L/C Commitments and the obligation of Issuing Bank to issue any Hedge
Letter of Credit shall immediately terminate, (C) each of the following shall
immediately become due and payable, in each case without presentment, demand,
protest or other requirements of any kind, all of which are hereby expressly
waived by each Credit Party: (I) the unpaid principal amount of and accrued
interest on the Loans, (II) an amount, to be held as cash collateral, equal to
the maximum amount that may at any time be drawn under all Letters of Credit
then outstanding (regardless of whether any beneficiary under any such Letter of
Credit shall have presented, or shall be entitled at such time to present, the
drafts or other documents or certificates required to draw under such Letters of
Credit), (III) an amount, to be held as cash collateral, equal to the maximum
amount that may at any time be drawn under all Hedge Letters of Credit then
outstanding (regardless of whether any beneficiary under any such Hedge Letter
of Credit shall have presented, or shall be entitled at such time to present,
the drafts or other documents or certificates required to draw under the Hedge
Letters of Credit) and (IV) all other Obligations; provided, the foregoing shall
not affect in any way the obligations of Lenders under Section 2.4(e);
(D) Administrative Agent may cause Collateral Trustee to enforce any and all
Liens and security interests created pursuant to Collateral Documents; and
(E) Administrative Agent shall direct Company to pay (and Company hereby agrees
upon receipt of such notice, or upon the occurrence of any Event of Default
specified in Section 8.1(f) and (g) to pay) to Administrative Agent such
additional amounts of cash, to be held as security for Company’s reimbursement
Obligations in respect of (i) Letters of Credit then outstanding, equal to the
Letter of Credit Usage at such time and (ii) Hedge Letters of Credit then
outstanding, equal to the Hedge Letter of Credit Usage at such time.

SECTION 9 AGENTS

9.1 Appointment of Agents. BNPP is hereby appointed Administrative Agent
hereunder and under the other Credit Documents and each Lender hereby authorizes
Administrative Agent to act as its agent in accordance with the terms hereof and
the other Credit Documents. The Administrative Agent hereby agrees to act upon
the express conditions contained herein and the other Credit Documents, as
applicable. The provisions of this Section 9 are solely for the benefit of
Agents and Lenders and no Credit Party shall have any rights as a third party
beneficiary of any of the provisions thereof. In performing its functions and
duties hereunder, each Agent shall act solely as an agent of Lenders and does
not assume and shall not be deemed to have assumed any obligation towards or
relationship of agency or trust with or for Company or any of its Subsidiaries.
No Syndication Agent or Documentation Agent shall have any obligations under the
Credit Documents, but shall be entitled to all benefits of this Section 9.

9.2 Powers and Duties. Each Lender irrevocably authorizes each Agent to take
such action on such Lender’s behalf and to exercise such powers, rights and
remedies hereunder and under the other Credit Documents as are specifically
delegated or granted to such Agent by the terms hereof and thereof, together
with such powers, rights and remedies as are reasonably incidental thereto. Each
Agent shall have only those duties and responsibilities that are expressly
specified herein and the other Credit Documents. Each Agent may exercise such
powers, rights and remedies and perform such duties by or through its agents or
employees. No Agent shall have, by reason hereof or any of the other Credit
Documents, a fiduciary relationship in respect of any Lender; and nothing herein
or any of the other Credit Documents, expressed or implied, is intended to or
shall be so construed as to impose upon any Agent any obligations in respect
hereof or any of the other Credit Documents except as expressly set forth herein
or therein.

9.3 General Immunity.

(a) No Responsibility for Certain Matters. No Agent shall be responsible to any
Lender for the execution, effectiveness, genuineness, validity, enforceability,
collectability or sufficiency hereof or any other Credit Document or for any
representations, warranties, recitals or statements made herein or therein or
made in any written or oral statements or in any financial or other statements,
instruments, reports or certificates or any other documents furnished or made by
any Agent to Lenders or by or on behalf of any Credit Party, any Lender or any
person providing the Settlement Service to any Agent or any Lender in connection
with the Credit Documents and the transactions contemplated thereby or for the
financial condition or business affairs of any Credit Party or any other Person
liable for the payment of any Obligations, nor shall any Agent be required to
ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained in any of the Credit
Documents or as to the use of the proceeds of the Loans or as to the existence
or possible existence of any Event of Default or Default or to make any
disclosures with respect to the foregoing. Anything contained herein to the
contrary notwithstanding, Administrative Agent shall not have any liability
arising from confirmations of the amount of outstanding Loans or the Letter of
Credit Usage or Hedge Letter of Credit Usage or the component amounts thereof.

(b) Exculpatory Provisions. No Agent nor any of its officers, partners,
directors, employees or agents shall be liable to Lenders for any action taken
or omitted by any Agent under or in connection with any of the Credit Documents
except to the extent caused by such Agent’s gross negligence or willful
misconduct. Each Agent shall be entitled to refrain from any act or the taking
of any action (including the failure to take an action) in connection herewith
or any of the other Credit Documents or from the exercise of any power,
discretion or authority vested in it hereunder or thereunder unless and until
such Agent shall have received instructions in respect thereof from Requisite
Lenders (or such other Lenders as may be required to give such instructions
under Section 10.5) and, upon receipt of such instructions from Requisite
Lenders (or such other Lenders, as the case may be), such Agent shall be
entitled to act or (where so instructed) refrain from acting, or to exercise
such power, discretion or authority, in accordance with such instructions.
Without prejudice to the generality of the foregoing, (i) each Agent shall be
entitled to rely, and shall be fully protected in relying, upon any
communication, instrument or document believed by it to be genuine and correct
and to have been signed or sent by the proper Person or Persons, including any
Settlement Confirmation or other communication issues by any Settlement Service,
and shall be entitled to rely and shall be protected in relying on opinions and
judgments of attorneys (who may be attorneys for Company and its Subsidiaries),
accountants, experts and other professional advisors selected by it; and (ii) no
Lender shall have any right of action whatsoever against any Agent as a result
of such Agent acting or (where so instructed) refraining from acting hereunder
or any of the other Credit Documents in accordance with the instructions of
Requisite Lenders (or such other Lenders as may be required to give such
instructions under Section 10.5).

(c) Delegation of Duties. Administrative Agent may perform any and all of its
duties and exercise its rights and powers under this Agreement or under any
other Credit Document by or through any one or more sub-agents appointed by
Administrative Agent. 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 Affiliates. The exculpatory, indemnification and other provisions of
this Section 9.3 and of Section 9.6 shall apply to any the Affiliates of
Administrative 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. All of the rights, benefits, and
privileges (including the exculpatory and indemnification provisions) of this
Section 9.3 and of Section 9.6 shall apply to any such sub-agent and to the
Affiliates of any such sub-agent, and shall apply to their respective activities
as sub-agent as if such sub-agent and Affiliates were named herein.
Notwithstanding anything herein to the contrary, with respect to each sub-agent
appointed by the Administrative Agent, (i) such sub-agent shall be a third party
beneficiary under this Agreement with respect to all such rights, benefits and
privileges (including exculpatory rights and rights to indemnification) and
shall have all of the rights and benefits of a third party beneficiary,
including an independent right of action to enforce such rights, benefits and
privileges (including exculpatory rights and rights to indemnification)
directly, without the consent or joinder of any other Person, against any or all
of the Credit Parties and the Lenders, (ii) such rights, benefits and privileges
(including exculpatory rights and rights to indemnification) shall not be
modified or amended without the consent of such sub-agent, and (iii) such
sub-agent shall only have obligations to Administrative Agent and not to any
Credit Party, Lender or any other Person and no Credit Party, Lender or any
other Person shall have any rights, directly or indirectly, as a third party
beneficiary or otherwise, against such sub-agent.

9.4 Agents Entitled to Act as Lender. The agency hereby created shall in no way
impair or affect any of the rights and powers of, or impose any duties or
obligations upon, any Agent in its individual capacity as a Lender hereunder.
With respect to its participation in the Loans and the Letters of Credit and
Hedge Letters of Credit, each Agent shall have the same rights and powers
hereunder as any other Lender and may exercise the same as if it were not
performing the duties and functions delegated to it hereunder, and the term
“Lender” shall, unless the context clearly otherwise indicates, include each
Agent in its individual capacity. Any Agent and its Affiliates may accept
deposits from, lend money to, own securities of, and generally engage in any
kind of banking, trust, financial advisory or other business with Company or any
of its Affiliates as if it were not performing the duties specified herein, and
may accept fees and other consideration from Company for services in connection
herewith and otherwise without having to account for the same to Lenders.

9.5 Lenders’ Representations, Warranties and Acknowledgment.

(a) Each Lender represents and warrants that it has made its own independent
investigation of the financial condition and affairs of Company and its
Subsidiaries in connection with Credit Extensions hereunder and that it has made
and shall continue to make its own appraisal of the creditworthiness of Company
and its Subsidiaries. No Agent shall have any duty or responsibility, either
initially or on a continuing basis, to make any such investigation or any such
appraisal on behalf of Lenders or to provide any Lender with any credit or other
information with respect thereto, whether coming into its possession before the
making of the Loans or at any time or times thereafter, and no Agent shall have
any responsibility with respect to the accuracy of or the completeness of any
information provided to Lenders or otherwise disclosed to such Lender.

(b) Each Lender, by delivering its signature page to this Agreement and funding
its Revolving Loans on the Closing Date, shall be deemed to have acknowledged
receipt of, and consented to and approved, each Credit Document and each other
document required to be approved by any Agent, Requisite Lenders or Lenders, as
applicable on the Closing Date and posted to IntraLinks.

9.6 Right to Indemnity. Each Lender, in proportion to its Pro Rata Share,
severally agrees to indemnify each Agent and each Issuing Bank, to the extent
that such Agent or Issuing Bank shall not have been reimbursed by any Credit
Party, for and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses (including reasonable
counsel fees and disbursements) or disbursements of any kind or nature
whatsoever which may be imposed on, incurred by or asserted against such Agent
or Issuing Bank in exercising its powers, rights and remedies or performing its
duties hereunder or under the other Credit Documents or otherwise in its
capacity as such Agent or Issuing Bank in any way relating to or arising out of
this Agreement or the other Credit Documents; provided, no Lender shall be
liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from such Agent’s or Issuing Bank’s gross negligence or willful misconduct. If
any indemnity furnished to any Agent or Issuing Bank for any purpose shall, in
the opinion of such Agent or Issuing Bank, be insufficient or become impaired,
such Agent or Issuing Bank may call for additional indemnity and cease, or not
commence, to do the acts indemnified against until such additional indemnity is
furnished; provided, in no event shall this sentence require any Lender to
indemnify any Agent against any liability, obligation, loss, damage, penalty,
action, judgment, suit, cost, expense or disbursement in excess of such Lender’s
Pro Rata Share thereof; and provided further, this sentence shall not be deemed
to require any Lender to indemnify any Agent or Issuing Bank against any
liability, obligation, loss, damage, penalty, action, judgment, suit, cost,
expense or disbursement described in the proviso in the immediately preceding
sentence.

9.7 Successor Administrative Agent. Administrative Agent may resign at any time
by giving thirty days’ prior written notice thereof to Lenders and Company, and
Administrative Agent may be removed at any time with or without cause by an
instrument or concurrent instruments in writing delivered to Company and
Administrative Agent and signed by Requisite Lenders. Upon any such notice of
resignation or any such removal, Requisite Lenders shall have the right, upon
five Business Days’ notice to Company, and in consultation with Company, to
appoint a successor Administrative Agent. Upon the acceptance of any appointment
as Administrative Agent hereunder by a successor Administrative Agent, that
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring or removed
Administrative Agent and the retiring or removed Administrative Agent shall
promptly (i) transfer to such successor Administrative Agent all sums,
Securities and other items of Collateral held under the Collateral Documents,
together with all records and other documents necessary or appropriate in
connection with the performance of the duties of the successor Administrative
Agent under the Credit Documents, and (ii) execute and deliver to such successor
Administrative Agent such amendments to financing statements, and take such
other actions, as may be necessary or appropriate in connection with the
assignment to such successor Administrative Agent of the security interests
created under the Collateral Documents, whereupon such retiring or removed
Administrative Agent shall be discharged from its duties and obligations
hereunder. After any retiring or removed Administrative Agent’s resignation or
removal hereunder as Administrative Agent, the provisions of this Section 9
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent hereunder.

9.8 Collateral Documents and Guaranty.

(a) Agents under Collateral Documents and Guaranty. Each Lender hereby further
authorizes Administrative Agent or any other Person appointed by Administrative
Agent, on behalf of and for the benefit of Lenders, to (i) be the agent for and
representative of Lenders with respect to the Guaranty, the Collateral and the
Collateral Documents and (ii) enter into the Collateral Trust Agreement and
appoint the Collateral Trustee to act on behalf of the Agents and the Lenders
with respect to the Collateral, and each Lender agrees to be bound by the terms
of the Collateral Trust Agreement. Subject to Section 10.5, without further
written consent or authorization from Lenders, Administrative Agent or any other
Person appointed by Administrative Agent may execute any documents or
instruments necessary to (i) in accordance with the terms of the Collateral
Trust Agreement and the Collateral Documents, release, or authorize the release
of, any Lien encumbering any item of Collateral that is the subject of a sale or
other disposition of assets permitted hereby or to which Requisite Lenders (or
such other Lenders as may be required to give such consent under Section 10.5)
have otherwise consented or (ii) release any Guarantor from the Guaranty
pursuant to Section 7.12 or with respect to which Requisite Lenders (or such
other Lenders as may be required to give such consent under Section 10.5) have
otherwise consented; provided that Administrative Agent shall not enter into or
consent to any material amendment, modification, termination or waiver of the
Collateral Trust Agreement without the prior consent of Requisite Lenders (or
such other Lenders as may be required to give such instructions under subsection
10.5).

(b) Right to Realize on Collateral and Enforce Guaranty. Anything contained in
any of the Credit Documents to the contrary notwithstanding, Company,
Administrative Agent and each Lender hereby agree that (i) no Lender shall have
any right individually to realize upon any of the Collateral or to enforce the
Guaranty, it being understood and agreed that all powers, rights and remedies
hereunder may be exercised solely by Administrative Agent, on behalf of Lenders
in accordance with the terms hereof and all powers, rights and remedies under
the Collateral Documents may be exercised solely by Administrative Agent or
Collateral Trustee, as applicable, and (ii) in the event of a foreclosure by
Collateral Trustee on any of the Collateral pursuant to a public or private
sale, Administrative Agent or any Lender may be the purchaser of any or all of
such Collateral at any such sale and Administrative Agent, as agent for and
representative of Secured Parties (but not any Lender or Lenders in its or their
respective individual capacities unless Requisite Lenders shall otherwise agree
in writing) shall be entitled, for the purpose of bidding and making settlement
or payment of the purchase price for all or any portion of the Collateral sold
at any such public sale, to use and apply any of the Obligations as a credit on
account of the purchase price for any collateral payable by Administrative Agent
at such sale.

SECTION 10 MISCELLANEOUS

10.1 Notices. Unless otherwise specifically provided herein, any notice or other
communication herein required or permitted to be given to a Credit Party,
Administrative Agent, or Issuing Bank shall be sent to such Person’s address as
set forth on Appendix B or in the other relevant Credit Document, and in the
case of any Lender, the address as indicated on Appendix B or otherwise
indicated to Administrative Agent in writing. Each notice hereunder shall be in
writing and may be personally served, telexed or sent by telefacsimile or United
States mail or courier service and shall be deemed to have been given when
delivered in person or by courier service and signed for against receipt
thereof, upon receipt of telefacsimile or telex, or three Business Days after
depositing it in the United States mail with postage prepaid and properly
addressed; provided, no notice to any Agent shall be effective until received by
such Agent; provided further, any such notice or other communication shall at
the request of the Administrative Agent be provided to any sub-agent appointed
pursuant to Section 9.3(c) hereto as designated by the Administrative Agent from
time to time.

10.2 Expenses. Whether or not the transactions contemplated hereby shall be
consummated, Company agrees to pay promptly (a) all the actual and reasonable
costs and expenses of preparation of the Credit Documents and any consents,
amendments, waivers or other modifications thereto; (b) all the costs of
furnishing all opinions by counsel for Company and the other Credit Parties; (c)
the reasonable fees, expenses and disbursements of counsel to Administrative
Agent and Syndication Agent in connection with the negotiation, preparation,
execution and administration of the Credit Documents and any consents,
amendments, waivers or other modifications thereto and any other documents or
matters requested by Company; (d) all the actual costs and reasonable expenses
of creating and perfecting Liens in favor of Collateral Trustee, for the benefit
of Administrative Agent and Lenders pursuant hereto, including filing and
recording fees, expenses and taxes, stamp or documentary taxes, search fees,
title insurance premiums and reasonable fees, expenses and disbursements of
counsel to Administrative Agent and Collateral Trustee and of counsel providing
any opinions that Administrative Agent, Collateral Trustee or Requisite Lenders
may request in respect of the Collateral or the Liens created pursuant to the
Collateral Documents; (e) all the actual costs and reasonable expenses
(including the reasonable fees, expenses and disbursements of any appraisers,
consultants, advisors and agents employed or retained by Collateral Trustee and
Administrative Agent and their respective counsel) in connection with the
custody or preservation of any of the Collateral; (g) all other actual and
reasonable costs and expenses incurred by Administrative Agent and Syndication
Agent in connection with the syndication of the Loans and Commitments and the
negotiation, preparation and execution of the Credit Documents and any consents,
amendments, waivers or other modifications thereto and the transactions
contemplated thereby; and (h) after the occurrence of a Default or an Event of
Default, all costs and expenses, including reasonable attorneys’ fees and costs
of settlement, incurred by any Agent, Collateral Trustee and Lenders in
enforcing any Obligations of or in collecting any payments due from any Credit
Party hereunder or under the other Credit Documents by reason of such Default or
Event of Default (including in connection with the sale of, collection from, or
other realization upon any of the Collateral or the enforcement of the Guaranty)
or in connection with any refinancing or restructuring of the credit
arrangements provided hereunder in the nature of a “work-out” or pursuant to any
insolvency or bankruptcy cases or proceedings.

10.3 Indemnity.

(a) In addition to the payment of expenses pursuant to Section 10.2, whether or
not the transactions contemplated hereby shall be consummated, each Credit Party
agrees to defend (subject to Indemnitees’ selection of counsel), indemnify, pay
and hold harmless, each Agent, each Issuing Bank and Lender and the officers,
partners, directors, trustees, advisors, employees, agents, sub-agents and
Affiliates of each Agent, the Collateral Trustee and each Lender (each, an
“Indemnitee”), from and against any and all Indemnified Liabilities; provided,
no Credit Party shall have any obligation to any Indemnitee hereunder with
respect to any Indemnified Liabilities to the extent such Indemnified
Liabilities arise from the gross negligence or willful misconduct of that
Indemnitee. To the extent that the undertakings to defend, indemnify, pay and
hold harmless set forth in this Section 10.3 may be unenforceable in whole or in
part because they are violative of any law or public policy, the applicable
Credit Party shall contribute the maximum portion that it is permitted to pay
and satisfy under applicable law to the payment and satisfaction of all
Indemnified Liabilities incurred by Indemnitees or any of them.

(b) To the extent permitted by applicable law, no Credit Party shall assert, and
each Credit Party hereby waives, any claim against Lenders, Agents, each Issuing
Bank and their respective Affiliates, directors, employees, attorneys, agents or
sub-agents, on any theory of liability, for special, indirect, consequential or
punitive damages (as opposed to direct or actual damages) (whether or not the
claim therefor is based on contract, tort or duty imposed by any applicable
legal requirement) arising out of, in connection with, arising out of, as a
result of, or in any way related to, this Agreement or any Credit Document or
any agreement or instrument contemplated hereby or thereby or referred to herein
or therein, the transactions contemplated hereby or thereby, any Loan or the use
of the proceeds thereof or any act or omission or event occurring in connection
therewith, and Company hereby waives, releases and agrees not to sue upon any
such claim or any such damages, whether or not accrued and whether or not known
or suspected to exist in its favor.

10.4 Set-Off. In addition to any rights now or hereafter granted under
applicable law and not by way of limitation of any such rights, upon the
occurrence of any Event of Default each Issuing Bank and Lender is hereby
authorized by each Credit Party at any time or from time to time subject to the
consent of Administrative Agent (such consent not to be unreasonably withheld or
delayed), without notice to any Credit Party or to any other Person (other than
Administrative Agent), any such notice being hereby expressly waived, to set off
and to appropriate and to apply any and all deposits (general or special,
including Indebtedness evidenced by certificates of deposit, whether matured or
unmatured, but not including trust accounts) and any other Indebtedness at any
time held or owing by such Issuing Bank or Lender to or for the credit or the
account of any Credit Party against and on account of the obligations and
liabilities of any Credit Party to such Issuing Bank or Lender hereunder, the
Letters of Credit and Hedge Letters of Credit and participations therein and
under the other Credit Documents, including all claims of any nature or
description arising out of or connected hereto, the Letters of Credit and Hedge
Letters of Credit and participations therein or with any other Credit Document,
irrespective of whether or not (a) such Issuing Bank or Lender shall have made
any demand hereunder or (b) the principal of or the interest on the Loans or any
amounts in respect of the Letters of Credit or Hedge Letters of Credit or any
other amounts due hereunder shall have become due and payable pursuant to
Section 2 and although such obligations and liabilities, or any of them, may be
contingent or unmatured.

10.5 Amendments and Waivers.

(a) Requisite Lenders’ Consent. Subject to Section 10.5(b) and 10.5(c), no
amendment, modification, termination or waiver of any provision of the Credit
Documents, or consent to any departure by any Credit Party therefrom, shall in
any event be effective without the written concurrence of the Requisite Lenders.

(b) Affected Lenders’ Consent. Without the written consent of each Lender (other
than a Defaulting Lender) that would be affected thereby, no amendment,
modification, termination, or consent shall be effective if the effect thereof
would:

(i) extend the scheduled final maturity of any Loan or Note;

(ii) waive, reduce or postpone any scheduled repayment (but not prepayment);

(iii) (x) extend the stated expiration date of any Letter of Credit beyond the
Revolving Commitment Termination Date or (y) extend the stated expiration date
of any Hedge Letter of Credit beyond the Hedge L/C Commitment Termination Date;

(iv) reduce the rate of interest on any Loan (other than any waiver of any
increase in the interest rate applicable to any Loan pursuant to Section 2.10)
or any fee payable hereunder;

(v) extend the time for payment of any such interest or fees;

(vi) reduce or forgive the principal amount of any Loan or any reimbursement
obligation in respect of any Letter of Credit or Hedge Letter of Credit;

(vii) amend, modify, terminate or waive any provision of this Section 10.5(b) or
Section 10.5(c);

(viii) amend the definition of “Requisite Lenders” or “Pro Rata Share”;
provided, with the consent of Requisite Lenders, additional extensions of credit
pursuant hereto may be included in the determination of “Requisite Lenders” or
“Pro Rata Share” on substantially the same basis as the Revolving Commitments,
the Revolving Loans, the Hedge L/C Commitments and the Hedge L/C Loans are
included on the Closing Date;

(ix) release all or substantially all of the Collateral or all Guarantors or any
material Guarantor from the Guaranty except as expressly provided in the Credit
Documents;

(x) consent to the assignment or transfer by any Credit Party of any of its
rights and obligations under any Credit Document; or

(xi) amend any provision in Section 10.6 which has the effect of further
restricting Lenders’ ability to assign or transfer all or a portion of their
rights and obligations under this Agreement, other than any amendments with
respect to the settlement of assignments through a Settlement Service.

(c) Other Consents. No amendment, modification, termination or waiver of any
provision of the Credit Documents, or consent to any departure by any Credit
Party therefrom, shall:

(i) increase any Revolving Commitment of any Lender over the amount thereof then
in effect without the consent of such Lender; provided, no amendment,
modification or waiver of any condition precedent, covenant, Default or Event of
Default shall constitute an increase in any Revolving Commitment of any Lender;

(ii) amend the definition of “Requisite Class Lenders” without the consent of
Requisite Class Lenders of each Class; provided, with the consent of the
Requisite Lenders, additional extensions of credit pursuant hereto may be
included in the determination of such “Requisite Class Lenders” on substantially
the same basis as the Revolving Commitments and the Revolving Loans are included
on the Closing Date;

(iii) alter the requirement to make, or the required application of any
repayments or prepayments as between Classes pursuant to Sections 2.14 or 2.15
hereof or Section 7.2 of the Pledge and Security Agreement without the consent
of Requisite Class Lenders of each Class which would receive a lesser repayment
or prepayment as a result thereof; provided, Requisite Lenders may waive, in
whole or in part, any prepayment so long as the application, as between Classes,
of any portion of such prepayment which is still required to be made is not
altered;

(iv) amend, modify, terminate or waive (A) any obligation of Lenders relating to
the purchase of participations in Letters of Credit or Hedge Letter of Credit as
provided in Section 2.4(e) or any other provision set forth in Section 2.4
without the written consent of Administrative Agent and of Issuing Bank or
(B) the last paragraph of Section 8.1 as it relates to the cash
collateralization of letter of credit obligations without the prior written
consent of each Issuing Bank;

(v) amend, modify, terminate or waive any provision of Section 9 as the same
applies to any Agent, or any other provision hereof as the same applies to the
rights or obligations of any Agent, in each case without the consent of such
Agent;

(vi) amend the definition of “Requisite Revolving Lenders” without the consent
of all of the Revolving Lenders; or

(vii) increase the Borrowing Base without the consent of all of the Revolving
Lenders.

(d) Execution of Amendments, etc. Administrative Agent may, but shall have no
obligation to, with the concurrence of any Lender, execute amendments,
modifications, waivers or consents on behalf of such Lender. Any waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which it was given. No notice to or demand on any Credit Party in
any case shall entitle any Credit Party to any other or further notice or demand
in similar or other circumstances. Any amendment, modification, termination,
waiver or consent effected in accordance with this Section 10.5 shall be binding
upon each Lender at the time outstanding, each future Lender and, if signed by a
Credit Party, on such Credit Party.

10.6 Successors and Assigns; Participations.

(a) Generally. This Agreement shall be binding upon the parties hereto and their
respective successors and assigns and shall inure to the benefit of the parties
hereto and the successors and assigns of Lenders. No Credit Party’s rights or
obligations hereunder nor any interest therein may be assigned or delegated by
any Credit Party without the prior written consent of all Lenders. 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 and, to the extent expressly contemplated hereby, Affiliates of
each of the Agents and Lenders) any legal or equitable right, remedy or claim
under or by reason of this Agreement.

(b) Register. Company, Administrative Agent and Lenders shall deem and treat the
Persons listed as Lenders in the Register as the holders and owners of the
corresponding Commitments and Loans listed therein for all purposes hereof, and
no assignment or transfer of any such Commitment or Loan shall be effective, in
each case, unless and until recorded in the Register following receipt of (x) a
written or electronic confirmation of an assignment issued by a Settlement
Service pursuant to Section 10.6(d) (a “Settlement Confirmation”) or (y) an
Assignment Agreement effecting the assignment or transfer thereof, in each case,
as provided in Section 10.6(d). Each assignment shall be recorded in the
Register on the Business Day the Settlement Confirmation or Assignment Agreement
is received by the Administrative Agent, if received by 12:00 noon New York City
time, and on the following Business Day if received after such time, prompt
notice thereof shall be provided to Company and a copy of such Assignment
Agreement or Settlement Confirmation shall be maintained, as applicable. The
date of such recordation of a transfer shall be referred to herein as the
“Assignment Effective Date.” Any request, authority or consent of any Person
who, at the time of making such request or giving such authority or consent, is
listed in the Register as a Lender shall be conclusive and binding on any
subsequent holder, assignee or transferee of the corresponding Commitments or
Loans.

(c) Right to Assign. Each Lender shall have the right at any time to assign all
or a portion of its rights and obligations under this Agreement, including,
without limitation, all or a portion of its Commitment or Loans owing to it or
other Obligation; provided, however, that:

(i) each assignment shall be of a uniform, and not varying, percentage of all
rights and obligations under and in respect of any Loan and any related
Commitments;

(ii) each assignment shall be to an Eligible Assignee;

(iii) if to an Eligible Assignee meeting the criteria of clause (i) of the
definition of “Eligible Assignee,” prior written notice of the assignment shall
have been given to Company and Administrative Agent;

(iv) in the case of an Eligible Assignee meeting the criteria of clause (ii) of
the definition of “Eligible Assignee” (except in the case of assignments made by
or to BNPP), each of Company, each Issuing Bank and Administrative Agent shall
have consented to such assignment (such consent not to be (x) unreasonably
withheld or delayed or (y) in the case of Company, required at any time an Event
of Default shall have occurred and then be continuing);

(v) each assignment shall be in an aggregate amount of not less than $5,000,000
(or such lesser amount as may be agreed to by Company and Administrative Agent
or as shall constitute the aggregate amount of the Revolving Commitments and
Revolving Loans or Hedge L/C Loans or Hedge L/C Commitments of the assigning
Lender);

(vi) the parties to each such assignment shall execute and deliver to the
Administrative Agent, for its acceptance and recording in the Register, an
Assignment and Acceptance, together with the Notes, if any, subject to such
assignment, and

(vii) each Eligible Assignee (other than the Eligible Assignee of the
Administrative Agent) shall pay to the Administrative Agent a $3,500
administrative fee.

(d) Mechanics. Assignments and assumptions of Revolving Loans, Revolving
Commitments, Hedge L/C Loans and Hedge L/C Commitments shall only be effected by
manual execution and delivery to the Administrative Agent of an Assignment
Agreement. Assignments made pursuant to the foregoing provision shall be
effective as of the Assignment Effective Date. In connection with all
assignments there shall be delivered to Administrative Agent such forms,
certificates or other evidence, if any, with respect to United States federal
income tax withholding matters as the assignee under such Assignment Agreement
may be required to deliver pursuant to Section 2.20(c).

(e) Representations and Warranties of Assignee. Each Lender, upon execution and
delivery hereof or upon succeeding to an interest in the Commitments and Loans,
as the case may be, represents and warrants as of the Closing Date or as of the
Assignment Effective Date that (i) it is an Eligible Assignee; (ii) it has
experience and expertise in the making of or investing in commitments or loans
such as the applicable Commitments or Loans, as the case may be; and (iii) it
will make or invest in, as the case may be, its Commitments or Loans for its own
account in the ordinary course of its business and without a view to
distribution of such Commitments or Loans within the meaning of the Securities
Act or the Exchange Act or other federal securities laws (it being understood
that, subject to the provisions of this Section 10.6, the disposition of such
Revolving Commitments or Loans or any interests therein shall at all times
remain within its exclusive control).

(f) Effect of Assignment. Subject to the terms and conditions of this
Section 10.6, as of the Assignment Effective Date: (i) the assignee thereunder
shall have the rights and obligations of a “Lender” hereunder to the extent of
its interest in the Loans and Commitments as reflected in the Register and shall
thereafter be a party hereto and a “Lender” for all purposes hereof; (ii) the
assigning Lender thereunder shall, to the extent that rights and obligations
hereunder have been assigned to the assignee, relinquish its rights (other than
any rights which survive the termination hereof under Section 10.8) and be
released from its obligations hereunder (and, in the case of an assignment
covering all or the remaining portion of an assigning Lender’s rights and
obligations hereunder, such Lender shall cease to be a party hereto on the
Assignment Effective Date; provided, anything contained in any of the Credit
Documents to the contrary notwithstanding, (y) Issuing Bank shall continue to
have all rights and obligations thereof with respect to such Letters of Credit
or Hedge Letters of Credit, as the case may be, until the cancellation or
expiration of such Letters of Credit or Hedge Letters of Credit, as applicable,
and the reimbursement of any amounts drawn thereunder and (z) such assigning
Lender shall continue to be entitled to the benefit of all indemnities hereunder
as specified herein with respect to matters arising out of the prior involvement
of such assigning Lender as a Lender hereunder); (iii) the Commitments shall be
modified to reflect the Commitment of such assignee and any Revolving Commitment
of such assigning Lender, if any; and (iv) if any such assignment occurs after
the issuance of any Note hereunder, the assigning Lender shall, upon the
effectiveness of such assignment or as promptly thereafter as practicable,
surrender its applicable Notes to Administrative Agent for cancellation, and
thereupon Company shall issue and deliver new Notes, if so requested by the
assignee and/or assigning Lender, to such assignee and/or to such assigning
Lender, with appropriate insertions, to reflect the new Revolving Commitments
and/or outstanding Loans of the assignee and/or the assigning Lender.

(g) Participations. Each Lender shall have the right at any time to sell one or
more participations to any Person (other than Company, any of its Subsidiaries
or any of its Affiliates) in all or any part of its Commitments, Loans or in any
other Obligation. The holder of any such participation, other than an Affiliate
of the Lender granting such participation, shall not be entitled to require such
Lender to take or omit to take any action hereunder except with respect to any
amendment, modification or waiver that would (i) extend the final scheduled
maturity of any Loan, Note, Letter of Credit or Hedge Letter of Credit (unless
such Letter of Credit or Hedge Letter of Credit is not extended beyond the
Revolving Commitment Termination Date or Hedge L/C Commitment Termination Date,
as applicable) in which such participant is participating, or reduce the rate or
extend the time of payment of interest or fees thereon (except in connection
with a waiver of applicability of any post-default increase in interest rates)
or reduce the principal amount thereof, or increase the amount of the
participant’s participation over the amount thereof then in effect (it being
understood that a waiver of any Default or Event of Default or of a mandatory
reduction in the Commitment shall not constitute a change in the terms of such
participation, and that an increase in any Commitment or Loan shall be permitted
without the consent of any participant if the participant’s participation is not
increased as a result thereof), (ii) consent to the assignment or transfer by
any Credit Party of any of its rights and obligations under this Agreement or
(iii) release all or substantially all of the Collateral under the Collateral
Documents (except as expressly provided in the Credit Documents) supporting the
Loans hereunder in which such participant is participating. Company agrees that
each participant shall be entitled to the benefits of Sections 2.18(c), 2.19 and
2.20 to the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to paragraph (c) of this Section; provided, (i) a
participant shall not be entitled to receive any greater payment under
Section 2.19 or 2.20 than the applicable Lender would have been entitled to
receive with respect to the participation sold to such participant, unless the
sale of the participation to such participant is made with Company’s prior
written consent and (ii) a participant that would be a Non-US Lender if it were
a Lender shall not be entitled to the benefits of Section 2.20 unless Company is
notified of the participation sold to such participant and such participant
agrees, for the benefit of Company, to comply with Section 2.20 as though it
were a Lender. To the extent permitted by law, each participant also shall be
entitled to the benefits of Section 10.4 as though it were a Lender, provided
such Participant agrees to be subject to Section 2.17 as though it were a
Lender.

(i) Certain Other Assignments. In addition to any other assignment permitted
pursuant to this Section 10.6, any Lender may assign and/or pledge all or any
portion of its Loans, the other Obligations owed by or to such Lender, and its
Notes, if any, to secure obligations of such Lender including, without
limitation, any Federal Reserve Bank as collateral security pursuant to
Regulation A of the Board of Governors of the Federal Reserve System and any
operating circular issued by such Federal Reserve Bank; provided, no Lender, as
between Company and such Lender, shall be relieved of any of its obligations
hereunder as a result of any such assignment and pledge, and provided further,
in no event shall the applicable Federal Reserve Bank, pledgee or trustee be
considered to be a “Lender” or be entitled to require the assigning Lender to
take or omit to take any action hereunder.

10.7 Independence of Covenants. All covenants hereunder shall be given
independent effect so that if a particular action or condition is not permitted
by any of such covenants, the fact that it would be permitted by an exception
to, or would otherwise be within the limitations of, another covenant shall not
avoid the occurrence of a Default or an Event of Default if such action is taken
or condition exists.

10.8 Survival of Representations, Warranties and Agreements. All
representations, warranties and agreements made herein shall survive the
execution and delivery hereof and the making of any Credit Extension.
Notwithstanding anything herein or implied by law to the contrary, the
agreements of each Credit Party set forth in Sections 2.18(c), 2.19, 2.20, 10.2,
10.3 and 10.4 and the agreements of Lenders set forth in Sections 2.17, 9.3(b)
and 9.6 shall survive the payment of the Loans, the cancellation or expiration
of the Letters of Credit and the Hedge Letters of Credit and the reimbursement
of any amounts drawn thereunder, and the termination hereof.

10.9 No Waiver; Remedies Cumulative. No failure or delay on the part of any
Agent or any Lender in the exercise of any power, right or privilege hereunder
or under any other Credit Document shall impair such power, right or privilege
or be construed to be a waiver of any default or acquiescence therein, nor shall
any single or partial exercise of any such power, right or privilege preclude
other or further exercise thereof or of any other power, right or privilege. The
rights, powers and remedies given to each Agent and each Lender hereby are
cumulative and shall be in addition to and independent of all rights, powers and
remedies existing by virtue of any statute or rule of law or in any of the other
Credit Documents or any of the Hedge Agreements. Any forbearance or failure to
exercise, and any delay in exercising, any right, power or remedy hereunder
shall not impair any such right, power or remedy or be construed to be a waiver
thereof, nor shall it preclude the further exercise of any such right, power or
remedy.

10.10 Marshalling; Payments Set Aside. Neither any Agent nor any Lender shall be
under any obligation to marshal any assets in favor of any Credit Party or any
other Person or against or in payment of any or all of the Obligations. To the
extent that any Credit Party makes a payment or payments to Administrative Agent
or Lenders (or to Administrative Agent, on behalf of Lenders), or Administrative
Agent or Lenders enforce any security interests or exercise their rights of
setoff, and such payment or payments or the proceeds of such enforcement or
setoff or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside and/or required to be repaid to a trustee,
receiver or any other party under any bankruptcy law, any other state or federal
law, common law or any equitable cause, then, to the extent of such recovery,
the obligation or part thereof originally intended to be satisfied, and all
Liens, rights and remedies therefor or related thereto, shall be revived and
continued in full force and effect as if such payment or payments had not been
made or such enforcement or setoff had not occurred.

10.11 Severability. In case any provision in or obligation hereunder or any Note
shall be invalid, illegal or unenforceable in any jurisdiction, the validity,
legality and enforceability of the remaining provisions or obligations, or of
such provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.

10.12 Obligations Several; Independent Nature of Lenders’ Rights. The
obligations of Lenders hereunder are several and no Lender shall be responsible
for the obligations or Commitment of any other Lender hereunder. Nothing
contained herein or in any other Credit Document, and no action taken by Lenders
pursuant hereto or thereto, shall be deemed to constitute Lenders as a
partnership, an association, a joint venture or any other kind of entity. The
amounts payable at any time hereunder to each Lender shall be a separate and
independent debt, and each Lender shall be entitled to protect and enforce its
rights arising out hereof and it shall not be necessary for any other Lender to
be joined as an additional party in any proceeding for such purpose.

10.13 Headings. Section headings herein are included herein for convenience of
reference only and shall not constitute a part hereof for any other purpose or
be given any substantive effect.

10.14 Applicable Law. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF
LAWS PRINCIPLES THEREOF (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW).

10.15 Consent to Jurisdiction. ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY
CREDIT PARTY ARISING OUT OF OR RELATING HERETO OR ANY OTHER CREDIT DOCUMENT, OR
ANY OF THE OBLIGATIONS, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF
COMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW YORK. BY EXECUTING
AND DELIVERING THIS AGREEMENT, EACH CREDIT PARTY, FOR ITSELF AND IN CONNECTION
WITH ITS PROPERTIES, IRREVOCABLY (a) ACCEPTS GENERALLY AND UNCONDITIONALLY THE
NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; (b) WAIVES ANY DEFENSE OF
FORUM NON CONVENIENS; (c) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH
PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, TO THE APPLICABLE CREDIT PARTY AT ITS ADDRESS PROVIDED IN
ACCORDANCE WITH SECTION 10.1; (d) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (c)
ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER THE APPLICABLE CREDIT
PARTY IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES
EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; AND (e) AGREES AGENTS AND
LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW
OR TO BRING PROCEEDINGS AGAINST ANY CREDIT PARTY IN THE COURTS OF ANY OTHER
JURISDICTION.

10.16 Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY AGREES TO WAIVE
ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING HEREUNDER OR UNDER ANY OF THE OTHER CREDIT DOCUMENTS OR ANY DEALINGS
BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THE
LENDER/COMPANY RELATIONSHIP THAT IS BEING ESTABLISHED. THE SCOPE OF THIS WAIVER
IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN
ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING
CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND
STATUTORY CLAIMS. EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL
INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED
ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO
RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS. EACH PARTY HERETO FURTHER
WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL
AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN
WAIVER SPECIFICALLY REFERRING TO THIS SECTION 10.16 AND EXECUTED BY EACH OF THE
PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS HERETO OR ANY OF THE OTHER CREDIT
DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADE
HEREUNDER. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.

10.17 Confidentiality. Each Lender shall hold all non-public information
regarding Company and its Subsidiaries and their businesses identified as such
by Company and obtained by such Lender pursuant to the requirements hereof in
accordance with such Lender’s customary procedures for handling confidential
information of such nature, it being understood and agreed by Company that, in
any event, a Lender may make (i) disclosures of such information to Affiliates
of such Lender and to their agents, trustees and advisors (and to other persons
authorized by a Lender or Agent to organize, present or disseminate such
information in connection with disclosures otherwise made in accordance with
this Section 10.17), (ii) disclosures of such information reasonably required by
any bona fide or potential assignee, transferee or participant in connection
with the contemplated assignment, transfer or participation by such Lender of
any Loans or any participations therein or by any direct or indirect contractual
counterparties (or the professional advisors thereto) in Hedge Agreements
(provided, such counterparties and advisors are advised of and agree to be bound
by the provisions of this Section 10.17), (iii) disclosure to any rating agency
when required by it, provided that, prior to any disclosure, such rating agency
shall undertake in writing to preserve the confidentiality of any confidential
information relating to the Credit Parties received by it from any of the Agents
or any Lender, and (iv) disclosures required or requested by any governmental
agency or representative thereof or by the NAIC or pursuant to legal or judicial
process; provided, unless specifically prohibited by applicable law or court
order, each Lender shall make reasonable efforts to notify Company of any
request by any governmental agency or representative thereof (other than any
such request in connection with any examination of the financial condition or
other routine examination of such Lender by such governmental agency) for
disclosure of any such non-public information prior to disclosure of such
information.

10.18 Usury Savings Clause. Notwithstanding any other provision herein, the
aggregate interest rate charged with respect to any of the Obligations,
including all charges or fees in connection therewith deemed in the nature of
interest under applicable law shall not exceed the Highest Lawful Rate. If the
rate of interest (determined without regard to the preceding sentence) under
this Agreement at any time exceeds the Highest Lawful Rate, the outstanding
amount of the Loans made hereunder shall bear interest at the Highest Lawful
Rate until the total amount of interest due hereunder equals the amount of
interest which would have been due hereunder if the stated rates of interest set
forth in this Agreement had at all times been in effect. In addition, if when
the Loans made hereunder are repaid in full the total interest due hereunder
(taking into account the increase provided for above) is less than the total
amount of interest which would have been due hereunder if the stated rates of
interest set forth in this Agreement had at all times been in effect, then to
the extent permitted by law, Company shall pay to Administrative Agent an amount
equal to the difference between the amount of interest paid and the amount of
interest which would have been paid if the Highest Lawful Rate had at all times
been in effect. Notwithstanding the foregoing, it is the intention of Lenders
and Company to conform strictly to any applicable usury laws. Accordingly, if
any Lender contracts for, charges, or receives any consideration which
constitutes interest in excess of the Highest Lawful Rate, then any such excess
shall be cancelled automatically and, if previously paid, shall at such Lender’s
option be applied to the outstanding amount of the Loans made hereunder or be
refunded to Company.

10.19 Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument.

10.20 Effectiveness. This Agreement shall become effective upon the execution of
a counterpart hereof by each of the parties hereto and receipt by Company and
Administrative Agent of written or telephonic notification of such execution and
authorization of delivery thereof. Upon the effectiveness of this Agreement and
the occurrence of the Closing Date, the engagement letter dated as of July 1,
2005 between BNPP and the Company shall have no further force or effect, except
with respect to such provisions which explicitly survive the termination of the
Commitment Letter by reason of the occurrence of the Closing Date. In addition,
unless specifically amended hereby, each of the Credit Documents, the Exhibits
and Schedules to this Agreement shall continue in full force and effect.

10.21 USA PATRIOT Act. Each Lender hereby notifies Company that pursuant to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the “Patriot Act”), it is required to obtain, verify and
record information that identifies Company, which information includes the name
and address of Company and other information that will allow such Lender to
identify Company in accordance with the Patriot Act.

10.22 Electronic Execution of Assignments. The words “execution,” “signed,”
“signature,” and words of like import in any Assignment Agreement shall be
deemed to include electronic signatures 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 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.

[Remainder of page intentionally left blank]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered by their respective officers thereunto duly authorized as
of the date first written above.

BELDEN & BLAKE CORPORATION

By: /s/ James Vanderhider
Name: James Vanderhider
Title: President and Chief Operating Officer

3

BNP PARIBAS,
as Lead Arranger, Syndication Agent, Administrative Agent and a Lender

     
By:
  /s/ Evans Swann
 
   
By:
  Authorized Signatory
/s/ Gabe Ellisor
 
   
 
  Authorized Signatory

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APPENDIX A-1
TO CREDIT AND GUARANTY AGREEMENT

Revolving Commitments

                  Lender   Revolving Commitment   Pro Rata Share
 
               
BNP Paribas
  $ 350,000,000.00       100.0 %
 
               
Total
  $ 350,000,000.00       100 %
 
               

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APPENDIX A-2
TO CREDIT AND GUARANTY AGREEMENT

Hedge L/C Commitments

                  Lender   Hedge L/C Commitment   Pro Rata Share
 
               
BNP Paribas
  $ 40,000,000.00       100.0 %
 
               
Total
  $ 40,000,000.00       100 %
 
               

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APPENDIX B
TO CREDIT AND GUARANTY AGREEMENT

Notice Addresses

BELDEN & BLAKE CORPORATION
5200 Stoneham Road, Suite 2500
North Canton, OH 44720-0500
Attention: Chief Financial Officer
Telephone: (330) 499-1660
Telecopier: (330) 497-5470

in each case, with copies to:

EnerVest Management Partners, Ltd.
1001 Fannin Street, Suite 800
Houston, TX 77002
Attention: James M. Vanderhider

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BNP PARIBAS, as Lead Arranger, Syndication Agent, Administrative Agent and a
Lender

919 Third Avenue

New York, NY 10022

Attention: Millie Carillo

Fax: (212) 841-2683

with a copy to:

1200 Smith, Suite 3100
Houston, Texas 77002
Attention: Gabe Ellisor
Fax: (713) 659-6915

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