EXHIBIT 10.1


 


SENIOR SECURED CREDIT AGREEMENT


 


 


Dated as of January 14, 2005


 


 


Among


 


UNIVERSAL COMPRESSION, INC.,
as Co-US Borrower and Guarantor,


 


UNIVERSAL COMPRESSION HOLDINGS, INC.,
as Co-US Borrower and Guarantor,


 


UC CANADIAN PARTNERSHIP HOLDINGS COMPANY,
as Canadian Borrower,


 


WACHOVIA BANK, NATIONAL ASSOCIATION,
as US Administrative Agent,


 


CONGRESS FINANCIAL CORPORATION (CANADA),
as Canadian Administrative Agent,


 


JPMORGAN CHASE BANK, N.A.,
as Syndication Agent,


 


DEUTSCHE BANK SECURITIES INC., THE BANK OF
NOVA SCOTIA AND

THE ROYAL BANK OF SCOTLAND PLC

as Co-Documentation Agents


 


AND


 


THE LENDERS SIGNATORY HERETO


 


Arranged by:


 


WACHOVIA CAPITAL MARKETS, LLC AND J.P. MORGAN
SECURITIES INC. 
as Joint Lead Arrangers and Joint Book Runners

and

DEUTSCHE BANK SECURITIES INC.

as Co-Arranger


 


$650,000,000 Senior Secured Credit Facilities


 





















 


TABLE OF
CONTENTS


 


	
  ARTICLE
  I Definitions and Accounting Matters

  	
   

  
	
   

  	
   

  
	
  Section 1.01

  	
  Terms
  Defined Above

  	
   

  
	
  Section 1.02

  	
  Certain
  Defined Terms

  	
   

  
	
  Section 1.03

  	
  Accounting
  Terms and Determinations

  	
   

  
	
  Section 1.04

  	
  References
  and Titles

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  II Commitments

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 2.01

  	
  Loans
  and Letters of Credit

  	
   

  
	
  Section 2.02

  	
  Borrowings,
  Continuations and Conversions, Letters of Credit

  	
   

  
	
  Section 2.03

  	
  Changes
  of Commitments

  	
   

  
	
  Section 2.04

  	
  Fees

  	
   

  
	
  Section 2.05

  	
  Several
  Obligations

  	
   

  
	
  Section 2.06

  	
  Notes

  	
   

  
	
  Section 2.07

  	
  Prepayments

  	
   

  
	
  Section 2.08

  	
  Reserved

  	
   

  
	
  Section 2.09

  	
  Assumption
  of Risks

  	
   

  
	
  Section 2.10

  	
  Obligation
  to Reimburse and to Prepay

  	
   

  
	
  Section 2.11

  	
  Lending
  Offices

  	
   

  
	
  Section 2.12

  	
  Bankers’
  Acceptances and BA Equivalent Loans

  	
   

  
	
  Section 2.13

  	
  Joint
  and Several Liability of the US Borrowers

  	
   

  
	
  Section 2.14

  	
  Conditions
  for Holdings to Become Sole US Borrower

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  III Payments of Principal and Interest

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 3.01

  	
  Repayment
  of Loans

  	
   

  
	
  Section 3.02

  	
  Interest

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  IV Payments; Pro Rata Treatment; Computations; Etc.

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 4.01

  	
  Payments

  	
   

  
	
  Section 4.02

  	
  Pro
  Rata Treatment

  	
   

  
	
  Section 4.03

  	
  Computations

  	
   

  
	
  Section 4.04

  	
  Agent
  Reliance

  	
   

  
	
  Section 4.05

  	
  Set-off,
  Sharing of Payments, Etc.

  	
   

  
	
  Section 4.06

  	
  Taxes

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  V Capital Adequacy

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 5.01

  	
  Additional
  Costs

  	
   

  
	
  Section 5.02

  	
  Limitation
  on US Dollar LIBOR Loans

  	
   

  
	
  Section 5.03

  	
  Illegality

  	
   

  
	
  Section 5.04

  	
  US
  Dollar Base Rate Loans Pursuant to Sections 5.01, 5.02 and 5.03

  	
   

  
	
  Section 5.05

  	
  Compensation

  	
   

  
	
  Section 5.06

  	
  Replacement
  Lenders

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VI Conditions Precedent

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 6.01

  	
  Effectiveness

  	
   

  



 


i





















 


	
  Section 6.02

  	
  Loans
  and Letters of Credit

  	
   

  
	
  Section 6.03

  	
  Conditions
  Precedent for the Benefit of Lenders

  	
   

  
	
  Section 6.04

  	
  Conditions
  Precedent to the Term Loans

  	
   

  
	
  Section 6.05

  	
  No
  Waiver 

  	
   

  
	
  Section 6.06

  	
  Canadian
  Tranche Borrowings

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VII Representations and Warranties of US Borrowers

  	
   

  
	
   

  	
   

  
	
  Section 7.01

  	
  Legal
  Existence

  	
   

  
	
  Section 7.02

  	
  Financial
  Condition

  	
   

  
	
  Section 7.03

  	
  Litigation

  	
   

  
	
  Section 7.04

  	
  No
  Breach

  	
   

  
	
  Section 7.05

  	
  Authority

  	
   

  
	
  Section 7.06

  	
  Approvals

  	
   

  
	
  Section 7.07

  	
  Use
  of Loans

  	
   

  
	
  Section 7.08

  	
  ERISA

  	
   

  
	
  Section 7.09

  	
  Taxes

  	
   

  
	
  Section 7.10

  	
  Titles,
  Etc.

  	
   

  
	
  Section 7.11

  	
  No
  Material Misstatements

  	
   

  
	
  Section 7.12

  	
  Investment
  Company Act

  	
   

  
	
  Section 7.13

  	
  Public
  Utility Holding Company Act

  	
   

  
	
  Section 7.14

  	
  Subsidiaries

  	
   

  
	
  Section 7.15

  	
  Location
  of Business and Offices

  	
   

  
	
  Section 7.16

  	
  Defaults

  	
   

  
	
  Section 7.17

  	
  Environmental
  Matters

  	
   

  
	
  Section 7.18

  	
  Compliance
  with the Law

  	
   

  
	
  Section 7.19

  	
  Insurance

  	
   

  
	
  Section 7.20

  	
  Hedging
  Agreements

  	
   

  
	
  Section 7.21

  	
  Restriction
  on Liens

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VIII Representations and Warranties of Canadian Borrower

  	
   

  
	
   

  	
   

  
	
  Section 8.01

  	
  Legal
  Existence

  	
   

  
	
  Section 8.02

  	
  No
  Breach

  	
   

  
	
  Section 8.03

  	
  Authority

  	
   

  
	
  Section 8.04

  	
  Approvals

  	
   

  
	
  Section 8.05

  	
  Defaults

  	
   

  
	
  Section 8.06

  	
  Income
  Tax Act (Canada)

  	
   

  
	
  Section 8.07

  	
  Use
  of Loans

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  IX Affirmative Covenants

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 9.01

  	
  Reporting
  Requirements

  	
   

  
	
  Section 9.02

  	
  Litigation

  	
   

  
	
  Section 9.03

  	
  Maintenance,
  Etc.

  	
   

  
	
  Section 9.04

  	
  Environmental
  Matters

  	
   

  
	
  Section 9.05

  	
  Further
  Assurances

  	
   

  
	
  Section 9.06

  	
  Performance
  of Obligations

  	
   

  
	
  Section 9.07

  	
  Reserved

  	
   

  
	
  Section 9.08

  	
  Reserved

  	
   

  
	
  Section 9.09

  	
  Collateral

  	
   

  



 


ii





















 


	
  Section 9.10

  	
  Notice
  of an ERISA Event

  	
   

  
	
  Section 9.11

  	
  Compression
  Collateral Appraisals

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  X Negative Covenants

  	
   

  
	
   

  	
   

  	
   

  
	
  Section
  10.01

  	
  Debt

  	
   

  
	
  Section
  10.02

  	
  Liens

  	
   

  
	
  Section
  10.03

  	
  Investments

  	
   

  
	
  Section
  10.04

  	
  Dividends,
  Distributions and Redemptions

  	
   

  
	
  Section
  10.05

  	
  Reserved

  	
   

  
	
  Section
  10.06

  	
  Nature
  of Business

  	
   

  
	
  Section
  10.07

  	
  Reserved

  	
   

  
	
  Section
  10.08

  	
  Mergers,
  Etc.

  	
   

  
	
  Section
  10.09

  	
  Proceeds
  of Notes; Letters of Credit

  	
   

  
	
  Section
  10.10

  	
  Reserved

  	
   

  
	
  Section
  10.11

  	
  Sale
  or Discount of Receivables

  	
   

  
	
  Section
  10.12

  	
  Fiscal
  Year Change

  	
   

  
	
  Section
  10.13

  	
  Certain
  Financial Covenants

  	
   

  
	
  Section
  10.14

  	
  Sale
  of Properties

  	
   

  
	
  Section
  10.15

  	
  Environmental
  Matters

  	
   

  
	
  Section
  10.16

  	
  Transactions
  with Affiliates

  	
   

  
	
  Section
  10.17

  	
  Subsidiaries

  	
   

  
	
  Section
  10.18

  	
  Negative
  Pledge Agreements

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  XI Events of Default; Remedies

  	
   

  
	
   

  	
   

  	
   

  
	
  Section
  11.01

  	
  Events
  of Default

  	
   

  
	
  Section
  11.02

  	
  Remedies

  	
   

  
	
  Section
  11.03

  	
  Letters
  of Credit

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  XII The Administrative Agent

  	
   

  
	
   

  	
   

  	
   

  
	
  Section
  12.01

  	
  Appointment,
  Powers and Immunities of the Administrative Agents

  	
   

  
	
  Section
  12.02

  	
  Reliance
  by the Administrative Agents

  	
   

  
	
  Section
  12.03

  	
  Defaults

  	
   

  
	
  Section
  12.04

  	
  Rights
  as a Lender

  	
   

  
	
  SECTION
  12.05

  	
  INDEMNIFICATION

  	
   

  
	
  Section
  12.06

  	
  Non-Reliance
  on the Administrative Agents and other Lenders

  	
   

  
	
  Section
  12.07

  	
  Action
  by the Administrative Agents

  	
   

  
	
  Section
  12.08

  	
  Resignation
  or Removal of the Administrative Agents

  	
   

  
	
  Section
  12.09

  	
  Notification
  by US Administrative Agent

  	
   

  
	
  Section
  12.10

  	
  Joint
  Lead Arrangers, Joint Book Runners, Documentation Agent

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  XIII Miscellaneous

  	
   

  
	
   

  	
   

  	
   

  
	
  Section
  13.01

  	
  Waiver

  	
   

  
	
  Section
  13.02

  	
  Notices

  	
   

  
	
  Section
  13.03

  	
  Payment
  of Expenses, Indemnities, etc.

  	
   

  
	
  Section
  13.04

  	
  Amendments,
  Etc.

  	
   

  
	
  Section
  13.05

  	
  Successors
  and Assigns

  	
   

  
	
  Section
  13.06

  	
  Assignments
  and Participations

  	
   

  
	
  Section 13.07

  	
  Invalidity

  	
   

  



 


iii





















 


	
  Section 13.08

  	
  Counterparts

  	
   

  
	
  Section 13.09

  	
  Reserved

  	
   

  
	
  Section 13.10

  	
  Survival

  	
   

  
	
  Section 13.11

  	
  Reserved

  	
   

  
	
  SECTION 13.12

  	
  NO ORAL AGREEMENTS

  	
   

  
	
  SECTION 13.13

  	
  GOVERNING LAW; SUBMISSION TO JURISDICTION

  	
   

  
	
  Section 13.14

  	
  Interest

  	
   

  
	
  Section 13.15

  	
  Confidentiality

  	
   

  
	
  Section 13.16

  	
  Effectiveness

  	
   

  
	
  SECTION 13.17

  	
  EXCULPATION PROVISIONS

  	
   

  
	
  Section 13.18

  	
  Hedging Agreements

  	
   

  
	
  Section 13.19

  	
  USA Patriot Act Notice

  	
   

  
	
  Section 13.20

  	
  Restatement

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XIV GUARANTY

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 14.01

  	
  The Guaranty

  	
   

  
	
  Section 14.02

  	
  Subrogation

  	
   

  
				



 


	
  ANNEXES, EXHIBITS AND SCHEDULES

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Annex I

  	
  -

  	
   

  	
  US Tranche Commitments and US Tranche
  Percentage

  	
   

  
	
  Annex II

  	
  -

  	
   

  	
  Canadian Allocated Commitments and Canadian
  Tranche Percentage

  	
   

  
	
  Annex III

  	
  -

  	
   

  	
  Term Commitments and Term Loan Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit A-1

  	
  -

  	
   

  	
  Form of US Revolving Note

  	
   

  
	
  Exhibit A-2

  	
  -

  	
   

  	
  Form of Canadian Revolving Note

  	
   

  
	
  Exhibit A-3

  	
  -

  	
   

  	
  Form of Term Note

  	
   

  
	
  Exhibit A-4

  	
  -

  	
   

  	
  Form of BA Equivalent Note

  	
   

  
	
  Exhibit B-1

  	
  -

  	
   

  	
  Form of US Borrowing, Continuation and
  Conversion Request

  	
   

  
	
  Exhibit B-2

  	
  -

  	
   

  	
  Form of Canadian Borrowing, Continuation
  and Conversion Request

  	
   

  
	
  Exhibit C-1

  	
  -

  	
   

  	
  Form of Compliance Certificate (Condition
  to Close)

  	
   

  
	
  Exhibit C-2

  	
  -

  	
   

  	
  Form of Compliance Certificate (Ongoing)

  	
   

  
	
  Exhibit D

  	
  -

  	
   

  	
  List of Security Instruments

  	
   

  
	
  Exhibit E

  	
  -

  	
   

  	
  Form of Assignment Agreement

  	
   

  
	
  Exhibit F

  	
  -

  	
   

  	
  Form of Letter of Credit Application

  	
   

  
	
  Exhibit G

  	
  -

  	
   

  	
  Form of Election Certificate

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Schedule 2.01(b)

  	
  -

  	
  Existing
  Letters of Credit

  	
   

  
	
  Schedule
  6.01(q)

  	
  -

  	
  Excepted
  Property

  	
   

  
	
  Schedule 7.02

  	
  -

  	
  Liabilities

  	
   

  
	
  Schedule 7.03

  	
  -

  	
  Litigation

  	
   

  
	
  Schedule 7.09

  	
  -

  	
  Taxes

  	
   

  
	
  Schedule 7.10

  	
  -

  	
  Titles,
  Etc.

  	
   

  
	
  Schedule 7.14

  	
  -

  	
  Subsidiaries

  	
   

  
	
  Schedule 7.17

  	
  -

  	
  Environmental
  Matters

  	
   

  
	
  Schedule 7.19

  	
  -

  	
  Insurance

  	
   

  



 


iv





















 


	
  Schedule 7.20

  	
  -

  	
  Hedging
  Agreements

  	
   

  
	
  Schedule 7.21

  	
  -

  	
  Restriction
  on Liens

  	
   

  
	
  Schedule 10.01

  	
  -

  	
  Debt

  	
   

  
	
  Schedule 10.02

  	
  -

  	
  Liens

  	
   

  
	
  Schedule 10.03

  	
  -

  	
  Investments,
  Loans and Advances

  	
   

  
	
  Schedule
  10.16

  	
  -

  	
  Transactions
  with Affiliates

  	
   

  



 


v





















 


THIS SENIOR SECURED CREDIT AGREEMENT
dated as of January 14, 2005, is among: 
UNIVERSAL COMPRESSION, INC., a corporation formed under the laws of the
State of Texas (a “US Borrower” and sometimes referred to herein as “UCI”,
and in its capacity as guarantor of the Canadian Tranche Loans, a “Guarantor”);
UNIVERSAL COMPRESSION HOLDINGS, INC., a corporation formed under the laws of
the State of Delaware (a “US Borrower” and sometimes referred to herein
as “Holdings”, and in its capacity as guarantor of the Canadian Tranche
Loans, a “Guarantor”, together with UCI, the “US Borrowers”); UC
CANADIAN PARTNERSHIP HOLDINGS COMPANY, a Nova Scotia ULC (the “Canadian
Borrower”); WACHOVIA BANK, NATIONAL ASSOCIATION, individually and as US
administrative agent for the Lenders (herein, together with its successors in
such capacity, the “US Administrative Agent”); CONGRESS FINANCIAL
CORPORATION (CANADA), individually and as Canadian administrative agent for the
Lenders (herein, together with its successors in such capacity, the “Canadian
Administrative Agent”); JPMORGAN CHASE BANK, N.A., individually and as
syndication agent (herein, together with its successors in such capacity, the “Syndication
Agent”); WACHOVIA CAPITAL MARKETS, LLC (“Wachovia Securities”) and
J.P. MORGAN SECURITIES INC. (“JPMSI” and together with Wachovia
Securities and their successors in such capacity, the “Joint-Lead Arrangers”
and “Joint-Book Runners”); DEUTSCHE BANK SECURITIES INC., as a
co-arranger (herein, together with its successors in such capacity, “DBS”);
DBS, THE BANK OF NOVA SCOTIA (“Scotia”) and THE ROYAL BANK OF SCOTLAND
PLC (“RBS” and together with DBS and Scotia and their successors in such
capacity, the “Documentation Agents”); and each of the lenders that is a
signatory hereto or which becomes a signatory hereto pursuant to Section 13.06
(individually, together with its successors and assigns, a “Lender” and,
collectively, the “Lenders”).


 


RECITALS


 


A.                                   On
October 25, 2004, UCI, Universal Compression (Ontario) Ltd., certain lenders,
the US Administrative Agent and the Canadian Administrative Agent entered into
that certain Amended and Restated Senior Secured Revolving Credit Agreement (as
amended, modified or restated from time to time, the “Existing Credit
Agreement”).


 


B.                                     The
Borrowers, the Lenders and the Administrative Agents mutually desire to replace
the Existing Credit Agreement in its entirety to, among other things, add
Holdings as a US Borrower, add a term loan B facility and permit the Canadian
Borrower to borrow in Canadian Dollars.


 


NOW, THEREFORE, in consideration of the mutual
covenants and agreements herein contained and of the loans, extensions of
credit and commitments hereinafter referred to, the parties hereto agree to
replace the Existing Credit Agreement and carry forward the outstanding
indebtedness thereunder as follows:


 


ARTICLE I

Definitions and Accounting Matters


 


Section 1.01                                Terms Defined Above.  As used in this Senior Secured Credit Agreement,
the terms “Canadian Administrative Agent,” “Canadian Borrower,” “DBS,” “Documentation
Agent,” “Existing Credit Agreement,” “Guarantor,” “Holdings,” “Joint Book
Runners,” “Joint Lead Arrangers,” “JPMSI,” “Lender,” “Lenders,” “RBS,” “Scotia,”


 





















 


“Syndication
Agent,” “UCI,” “US Administrative Agent,” “US Borrower” and “Wachovia
Securities” shall have the meanings indicated above.  The following terms which are defined in the
Uniform Commercial Code in effect in the State of Texas on the date hereof are
used herein as so defined: Accounts, Chattel Paper, Documents, Equipment,
General Intangibles, Instruments and Inventory.


 


Section 1.02                                Certain Defined
Terms.  As used herein, the following
terms shall have the following meanings (all terms defined in this ARTICLE I
or in other provisions of this Senior Secured Credit Agreement in the singular
to have equivalent meanings when used in the plural and vice versa):


 


“ABS Facility” shall mean that certain
$200,000,000 asset backed securitization facility under that certain Indenture
dated December 31, 2002, between BRL Universal Compression Funding I 2002,
L.P., as Issuer, and Wells Fargo Bank, National Association, as Indenture
Trustee, as amended, modified, supplemented, restated, refinanced, or replaced
by another non-recourse facility or increased by another non-recourse facility
as permitted under Section 10.01(e).


 


“Acceptance Date” shall mean any date, which
must be a Business Day, on which a Bankers’ Acceptance is or is to be issued or
a BA Equivalent Loan is or is to be made.


 


“Acceptance Fees” shall mean an amount for each
Bankers’ Acceptance and BA Equivalent Loan equal to the product of the
Applicable Margin for Acceptance Fees times the Principal Amount of such
Bankers’ Acceptance or BA Equivalent Loan times the Term/365.


 


“Accepting Lender” shall mean any Canadian
Tranche Revolving Lender that has accepted a Bankers’ Acceptance issued by (or
advanced a BA Equivalent Loan to) the Canadian Borrower under this Agreement.


 


“Administrative Agents” shall mean
collectively, the US Administrative Agent and the Canadian Administrative
Agent.


 


“Affected Loans” shall have the meaning
assigned such term in Section 5.04.


 


“Affiliate” of any Person shall mean
(a) any Person directly or indirectly controlled by, controlling or under
common control with such first Person, (b) any director or officer of such
first Person or of any Person referred to in clause (a) above and
(c) if any Person in clause (a) above is an individual, any member of
the immediate family (including parents, spouse and children) of such
individual and any trust whose principal beneficiary is such individual or one
or more members of such immediate family and any Person who is controlled by
any such member or trust.  For purposes
of this definition, any Person which owns directly or indirectly 10% or more of
the securities having ordinary voting power for the election of directors or
other governing body of a corporation or 10% or more of the partnership or
other ownership interests of any other Person (other than as a limited partner
of such other Person) will be deemed to “control” (including, with its
correlative meanings, “controlled by” and “under common control with”) such
corporation or other Person.


 


2





















 


“Aggregate Commitments” shall mean,
collectively the Aggregate Revolving Commitments and the Aggregate Term
Commitments.


 


“Aggregate Credit Exposure” shall mean the
aggregate Principal Amount of all Loans and LC Exposure outstanding at such
time.


 


“Aggregate Revolving Commitments” at any time
shall equal the sum of (a) the Aggregate US Tranche Commitments and (b) the
Canadian Allocated Total Commitments. 
The initial Aggregate Revolving Commitments are $250,000,000.


 


“Aggregate Term Commitments” at any time shall
equal the sum of the Term Commitments of all Term Loan Lenders, as the same may
be reduced pursuant to Section 2.03(a). 
The initial Aggregate Term Commitments are $400,000,000.


 


“Aggregate US Tranche Commitments” at any time
shall equal the sum of the US Tranche Commitments of all US Tranche Revolving
Lenders, as the same may be reduced pursuant to Sections 2.03(b) and (c).  The initial Aggregate US Tranche Commitments
are $225,000,000.


 


“Agreement” shall mean this Senior Secured Credit
Agreement, as the same may from time to time be amended or supplemented.


 


“Alternate Currency” shall mean such foreign
currencies which are readily convertible into US Dollars and are acceptable to
the US Administrative Agent.


 


“Applicable Administrative Agent” shall mean
(a) with respect to a Loan or Borrowing made or a Letter of Credit issued under
the US Tranche or the Term Loan B Facility, the US Administrative Agent and (b)
with respect to a Loan or Borrowing made under the Canadian Tranche, the Canadian
Administrative Agent.


 


“Applicable Borrower” shall mean (a) with
respect to a Loan or Borrowing made or a Letter of Credit issued under the US
Tranche or the Term Loan B Facility, the US Borrowers and (b) with respect to a
Loan or Borrowing made under the Canadian Tranche, the Canadian Borrower.


 


“Applicable Lenders” shall mean (a) with
respect to a Loan or Borrowing made or a Letter of Credit issued under the US
Tranche, the US Tranche Revolving Lenders, (b) with respect to a Loan or
Borrowing made under the Canadian Tranche, the Canadian Tranche Revolving
Lenders and (c) with respect to a Loan or Borrowing made under the Term Loan B
Facility, the Term Loan Lenders.


 


“Applicable Lending Office” shall mean, for
each Lender and for each Type of Loan, the lending office of such Lender (or a
Lender Affiliate) designated for such Type of Loan on the signature pages
hereof or such other offices of such Lender (or of a Lender Affiliate) as such
Lender may from time to time specify to the Applicable Administrative Agent and
the Applicable Borrower as the office by which its Loans of such Type are to be
made and maintained.


 


3





















 


“Applicable Margin” shall mean:


 


(a)                                  In respect of the
Term Loan B Facility, a percentage per annum determined by reference to the
ratings by Moody’s and S&P, respectively, applicable on such date to the
Index Debt, as set forth below:


 


Applicable
Margin


 




	
  Index Debt Ratings

  	
   

  	
  US Dollar LIBOR

  Loans

  	
   

  	
  US Dollar Base Rate

  Loans

  	
   

  
	
  Category 1

  >Ba1and BB+

  	
   

  	
  1.50

  	
  %

  	
  0.50

  	
  %

  
	
  Category 2
<Ba1 or BB+

  	
   

  	
  1.75

  	
  %

  	
  0.75

  	
  %

  






 


For purposes of the foregoing, if both Moody’s and
S&P shall not have in effect a rating for the Index Debt (other than by
reason of the circumstances referred to in the last sentence of this definition),
then such agencies shall be deemed to have established a rating in Category
2.  If the ratings established or deemed
to have been established by Moody’s and S&P for the Index Debt shall fall
within different Categories, the Applicable Margin shall be based on the lower
of the two ratings; provided, however, that if only one of Moody’s
or S&P shall have established a rating, then the Applicable Margin shall be
determined by reference to such available rating.  If the ratings established or deemed to have
been established by Moody’s and S&P for the Index Debt shall be changed
(other than as a result of a change in the rating system of Moody’s or
S&P), such change shall be effective as of the date on which it is first
announced by the applicable rating agency, irrespective of when notice of such
change shall have been furnished by Holdings to the US Administrative Agent
pursuant to Section 9.01 or otherwise. 
Each change in the Applicable Margin shall apply during the period
commencing on the effective date of such change and ending on the date
immediately preceding the effective date of the next such change.  If the rating system of Moody’s or S&P
shall change, or if either such rating agency shall cease to be in the business
of rating corporate debt obligations, Holdings and the Term Loan Lenders shall
negotiate in good faith to amend this definition to reflect such changed rating
system or the unavailability of ratings from such rating agency and, pending
the effectiveness of any such amendment, the Applicable Margin shall be
determined by reference to the rating of such agency most recently in effect
prior to such change or cessation.


 


(b)                                 In respect of the
Revolving Credit Facility and Commitment Fees, a percentage per annum
determined by reference to the Total Leverage Ratios as in effect from time to
time, as set forth below:


 


4





















 


Applicable
Margin


 


	
  Total Leverage Ratio

  	
   

  	
  US Dollar LIBOR

  Loans and Acceptance

  Fees

  	
   

  	
  US Dollar Base Rate

  Loans and Canadian

  Prime Rate Loans

  	
   

  	
  Commitment Fees

  	
   

  
	
  Greater than or equal to 4.75 to 1.0

  	
   

  	
  2.25

  	
  %

  	
  1.25

  	
  %

  	
  .50

  	
  %

  
	
  Greater than or equal to 4.25 to 1.0, but
  less than 4.75 to 1.0

  	
   

  	
  2.00

  	
  %

  	
  1.00

  	
  %

  	
  .50

  	
  %

  
	
  Greater than or equal to 3.75 to 1.0, but
  less than 4.25 to 1.0

  	
   

  	
  1.75

  	
  %

  	
  .75

  	
  %

  	
  .50

  	
  %

  
	
  Greater than or equal to 3.25 to 1.0 but
  less than 3.75 to 1.0

  	
   

  	
  1.50

  	
  %

  	
  .50

  	
  %

  	
  .35

  	
  %

  
	
  Less than 3.25 to 1.0

  	
   

  	
  1.25

  	
  %

  	
  .25

  	
  %

  	
  .30

  	
  %

  



 


(c)                                  For purposes of
determining the Applicable Margin, the first test period for EBITDA will be
calculated as of September 30, 2004.


 


Each change in
the Applicable Margin resulting from a change in the Total Leverage Ratio
(which shall be calculated quarterly) shall take effect as of the fifth
Business Day following the receipt of the compliance certificate delivered pursuant
to Section 9.01(h).


 


“Appraisal” shall mean the most recent appraisals of all
Compression Collateral of Holdings and any of its Domestic Subsidiaries
conducted by an independent appraiser reasonably satisfactory to the US
Administrative Agent at the expense of UCI.


 


“Assignment” shall have the meaning assigned
such term in Section 13.06(b).


 


“BA Equivalent Loan” shall mean an advance in
Canadian Dollars made by a Canadian Tranche Revolving Lender to the Canadian
Borrower evidenced by a BA Equivalent Note.


 


“BA Equivalent Note” shall mean a promissory
note executed and delivered by the Canadian Borrower to a Canadian Tranche
Revolving Lender in substantially the form of Exhibit A-4 or by each
Canadian Tranche Revolving Lender pursuant to the power of attorney in Section
2.12(b).


 


“BA Exposure” shall mean at any time, with
respect to any Accepting Lender, the aggregate Principal Amount of Bankers’
Acceptances and BA Equivalent Loans to be paid by the Canadian Borrower to the
Canadian Administrative Agent at the Canadian Principal Office for which the
Canadian Borrower has not reimbursed such Accepting Lender.


 


“BA Maturity Date” shall mean the date on which
a Bankers’ Acceptance is payable or a BA Equivalent Note matures in accordance
with Section 2.12(a)(ii).


 


“BA Net Proceeds” shall mean in respect of any
Bankers’ Acceptance or BA Equivalent Loan, the amount (rounded to the nearest
whole cent with one-half of one cent being rounded up)


 


5





















 


determined in accordance with
the formula set forth below, less the Acceptance Fee applicable to such Bankers’
Acceptance or BA Equivalent Loan.  The BA
Net Proceeds of any Bankers’ Acceptance or BA Equivalent Loan shall be equal to
the Principal Amount of such
Bankers’ Acceptance or BA Equivalent Loan times the Price.  For purposes of this definition, the “Price”
of any Bankers’ Acceptance or BA Equivalent Loan shall equal {1 / [1 + (Bankers’
Acceptance Rate X Term/365)]} and shall be expressed as a decimal and be
rounded to the nearest 1/10000 of 1%, with 0.0000005 being rounded up.


 


“Bankers’ Acceptance Rate” shall mean in
respect of a Bankers’ Acceptance accepted by an Accepting Lender on any date or
a BA Equivalent Loan being advanced by such Accepting Lender on any date, (a)
for a Canadian Tranche Revolving Lender which is a Major Schedule I Lender, the
CDOR Rate, and (b) for a Canadian Tranche Revolving Lender which is not a Major
Schedule I Lender, the CDOR Rate plus 10 basis points.


 


“Bankers’ Acceptances” shall mean bankers’
acceptances denominated in Canadian Dollars in the form of either a depository
bill, as defined in the DBNA, or a blank non-interest bearing bill of exchange,
as defined in the Bills of Exchange Act (Canada), in either case issued by the
Canadian Borrower and accepted by a Canadian Tranche Revolving Lender (and, if
applicable, purchased by such Canadian Tranche Revolving Lender) at the request
of the Canadian Borrower, such depository bill or bill of exchange to be
substantially in the standard form of such Canadian Tranche Revolving Lender.


 


“Bankruptcy Code” shall mean the Bankruptcy
Code in Title 11 of the United States Code, as amended, modified, succeeded or
replaced from time to time.


 


“Borrowers” shall mean collectively the US
Borrowers and the Canadian Borrower.


 


“Borrowing” shall mean Loans of the same Type,
made, converted or continued on the same date and, in the case of US Dollar
LIBOR Loans and in the case of Bankers’ Acceptances or BA Equivalent Loans, as
to which a single Interest Period is in effect.


 


“Business Day” shall mean, other than for
Letters of Credit, any day other than a day on which commercial banks are
authorized or required to close in North Carolina for purposes of the US
Tranche and the Term Loan B Facility, and in North Carolina or in Calgary or Toronto, Canada for
purposes of the Canadian Tranche, and, where such term is used in the
definition of “Quarterly Date” or if such day relates to a Borrowing or
continuation of, a payment or prepayment of principal of or interest on, or a
conversion of or into, or the Interest Period for, a US Dollar LIBOR Loan or a
notice by a Borrower with respect to any such Borrowing or continuation,
payment, prepayment, conversion or Interest Period, any day which is also a day
on which dealings in US Dollar deposits are carried out in the London interbank
market.  With respect to Letters of
Credit, “Business Day” shall mean any day other than a day on which
commercial banks are authorized or required to close in the domicility of the
respective Issuing Bank and confirming bank.


 


“CAM
Exchange” means the exchange of the Lender’s interests provided for in Section
11.02(c).


 


6





















 


“CAM
Exchange Date” means the date on which there shall occur an acceleration of
Loans pursuant to Section 11.02(a) or Section 11.02(b).


 


“CAM
Percentage” means, as to each Lender, a fraction, expressed as a decimal,
of which (a) the numerator shall be the aggregate Credit Exposure of such
Lender for all Tranches (determined by the US Dollar Equivalent Amount for its
Canadian Tranche Credit Exposure prevailing on the CAM Exchange Date and
determined by the US Dollar Equivalent for its LC Exposure in Offshore Currency
Letters of Credit prevailing on the CAM Exchange Date) and (b) the denominator
shall be the Aggregate Credit Exposure (determined by the US Dollar Equivalent
Amount for the Canadian Tranche Credit Exposure of all Canadian Tranche
Revolving Lenders as of the CAM Exchange Date and determined by the US Dollar
Equivalent for the LC Exposure in Offshore Currency Letters of Credit of all
Lenders as of the CAM Exchange Date).


 


“Canadian Allocated Commitment” shall mean as
to each Canadian Tranche Revolving Lender, the percentage set forth in the
column titled “Canadian Tranche Percentage” as set forth opposite such Canadian
Tranche Revolving Lender’s name on Annex II or in the Assignment
pursuant to which such Canadian Tranche Revolving Lender becomes a party
hereto, as applicable, of the Canadian Allocated Total Commitments.


 


“Canadian Allocated Maximum Total Commitments”
shall mean the aggregate maximum Canadian Allocated Commitments of all Canadian
Tranche Revolving Lenders as set forth opposite such Canadian Tranche Revolving
Lender’s name on Annex II or in the Assignment pursuant to which such
Canadian Tranche Revolving Lender becomes party hereto, as applicable.  The Canadian Allocated Maximum Total
Commitments are $60,000,000.  “Canadian
Allocated Maximum Total Commitment” in the singular shall mean for any
Canadian Tranche Revolving Lender at any time, its Canadian Tranche Percentage
times the Canadian Allocated Maximum Total Commitments.


 


“Canadian Allocated Total Commitments” shall
mean the aggregate amount of the US Tranche Commitments allocated by the US
Borrowers from time to time as the Canadian Allocated Total Commitments
pursuant to Section 2.03(c), not to exceed the Canadian Allocated
Maximum Total Commitments.  The Canadian
Allocated Total Commitments may be terminated pursuant to Section 2.03(d),
Section 5.06 or ARTICLE XI. 
The initial Canadian Allocated Total Commitments are $25,000,000.


 


“Canadian Allocation Period” shall mean any
time during which either (a) the US Borrowers have allocated any portion of the
US Tranche Commitments as the Canadian Allocated Total Commitments pursuant to Section
2.03(c) or (b) the Canadian Tranche Credit Exposure exceeds zero.


 


“Canadian Commitment Fee” shall have the
meaning assigned such term in Section 2.04(a)(ii).


 


“Canadian Dollars” or “C$” shall mean
lawful money of Canada.


 


“Canadian Prime Rate” shall mean, at any time,
the greater of (a) the rate from time to time publicly announced by the
Canadian Reference Bank as its prime rate in effect for


 


7





















 


determining interest rates on
Canadian Dollar denominated commercial loans in Canada, and (b) the annual
rate of interest equal to the sum of (i) the 30-day CDOR Rate at such time and
(ii) one percent (1%) per annum.


 


“Canadian Prime Rate Loans” shall mean Loans
denominated in Canadian Dollars that bear interest at a rate based upon the
Canadian Prime Rate.


 


“Canadian Principal Office” shall mean the
principal office of the Canadian Administrative Agent, which, on the date of
this Agreement is located at 141 Adelaide St., W., Suite 1500, Toronto,
Ontario, Canada M5H 3L9, Attention: 
Sophie Ronan (Telecopy No. (416) 364-8165).


 


“Canadian Reference Bank” shall mean the Bank
of Montreal, or its successors and assigns, or one of the Major Schedule I
Lenders as the US Administrative Agent may from time to time designate.


 


“Canadian Tranche” shall mean the Canadian
Allocated Commitments and the Canadian Tranche Loans.


 


“Canadian Tranche Borrowing” shall mean a
Borrowing comprised of Canadian Tranche Loans.


 


“Canadian Tranche Credit Exposure” shall mean
at any time, the US Dollar Equivalent Amount of the aggregate Principal Amount
of the Canadian Tranche Loans at such time. 
The Canadian Tranche Credit Exposure of any Canadian Tranche Revolving
Lender at any time shall be the US Dollar Equivalent Amount of the aggregate
Principal Amount of the Canadian Tranche Loans owed to such Lender at such
time.


 


“Canadian Tranche Loan” shall mean any
Revolving Loan (including Canadian Prime Rate Loans, Bankers’ Acceptances, BA
Equivalent Loans, US Dollar LIBOR Loans and US Dollar Base Rate Loans) made by
the Canadian Tranche Revolving Lenders pursuant to Section 2.01(a)(iii)
or Section 2.12, as applicable.


 


“Canadian Tranche Percentage” shall mean:


 


(a)                                  at
any time during which the US Tranche Commitments remain outstanding, with
respect to each Canadian Tranche Revolving Lender, the percentage set forth in
the column titled “Canadian Tranche Percentage” of such Canadian Tranche
Revolving Lender as set forth opposite such Canadian Tranche Revolving Lender’s
name on Annex II attached hereto or in the Assignment pursuant to which
such Canadian Tranche Revolving Lender becomes a party hereto; and


 


(b)                                 upon
the termination of the Aggregate Revolving Commitments pursuant to Section
11.02, with respect to each Canadian Tranche Revolving Lender, a fraction
(expressed as a percentage, carried out to the sixth decimal place), the numerator
of which is the Canadian Tranche Credit Exposure of such Canadian Tranche
Revolving Lender, and the denominator of which is the Canadian Tranche
Credit Exposure of all Canadian Tranche Revolving Lenders.


 


8





















 


As of the Closing Date,
the Canadian Tranche Percentage of each Canadian Tranche Revolving Lender is
set forth opposite the name of such Canadian Tranche Revolving Lender on Annex
II attached hereto or in the Assignment pursuant to which such Canadian
Tranche Revolving Lender becomes a party hereto, as applicable.


 


“Canadian Tranche Revolving Lender” shall mean
a Lender with a Canadian Allocated Commitment or with outstanding Canadian
Tranche Loans that is, for the purposes of the Income Tax Act (Canada) in force
as of the date that such Lender acquires a Canadian Allocated Commitment,
either (a) not a non-resident of Canada for purposes of the Income Tax Act
(Canada), or (b) a deemed resident of Canada for purposes of Part XIII of the
Income Tax Act (Canada) and that has, as part of its business carried on in
Canada, a Canadian Allocated Commitment, and, in the case of clauses (a) and
(b), is an Affiliate of a US Tranche Revolving Lender.


 


“Capital Lease” shall mean a lease of (or other
arrangement conveying the right to use) real and/or personal Property, or a
combination thereof, with respect to which the lessee is required concurrently
to recognize the acquisition of an asset and the incurrence of a Debt in
accordance with GAAP.


 


“Capital Lease Obligations” shall mean, as to
any Person, all obligations of such Person as lessee under any Capital Lease,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP, and the amount of such
obligations shall be the capitalized amount thereof determined in accordance
with GAAP.


 


“Capital Stock” shall mean, (a) with
respect to any Person that is a corporation, any and all shares, interests,
participations or other equivalents (however designated and whether or not
voting) of corporate stock and (b) with respect to any Person that is not
a corporation, any and all partnerships or other equity interests of such
Person.


 


“CDOR Rate” shall mean, on any day, the annual
rate of interest which is the rate applicable to Canadian Dollar bankers’
acceptances appearing on the “Reuters Screen CDOR Page” (as defined in the
International Swap Dealer Association, Inc, definitions, as modified and
amended from time to time) as of 10:00 a.m. Eastern time on such day for
bankers’ acceptances having for purposes of calculating the Canadian Prime Rate
a maturity of 30 days and for purposes of Bankers’ Acceptances and BA
Equivalent Notes a comparable maturity date to the maturity date of such issue
of Bankers’ Acceptances and BA Equivalent Notes; provided that if such
rate does not appear on the Reuters Screen CDOR Page as contemplated, then the
CDOR Rate on any day shall be the rate applicable to such Canadian Dollar
bankers’ acceptances of comparable maturity date quoted by one of the Major
Schedule I Lenders selected by the US Administrative Agent as of 10:00 a.m.
Eastern time on such day.


 


“CERCLA” shall have the meaning assigned such
term in the definition of Environmental Laws.


 


“Change of Control” means the occurrence of one
or more of the following events: 
(a) any sale, lease, exchange or other transfer (in one transaction
or a series of related transactions, but other than by the granting of a Lien
in accordance with or permitted by this Agreement or by way of consolidation or
merger) of all or substantially all of the assets of


 


9





















 


Holdings and its Subsidiaries,
taken as a whole, to any Person or “group” (as defined in Section 13(d)(3)
of the Exchange Act); (b) the approval by the holders of Capital Stock of
Holdings of any plan or proposal for the liquidation or dissolution of Holdings
(whether or not otherwise in compliance with the provisions of this Agreement);
(c) any Person or “group” within the meaning of Section 13(d) of the
Exchange Act shall become the “beneficial owner,” as defined in Rule 13d-3
under the Exchange Act, of shares representing more than 50% of the aggregate
voting power represented by the Capital Stock of Holdings; (d) the
replacement of a majority of the Board of Directors of Holdings over a two-year
period from the directors who constituted the Board of Directors of Holdings at
the beginning of such period, and such replacement shall not have been approved
by a vote of at least a majority of the Board of Directors of Holdings then
still in office who either were members of such Board of Directors at the
beginning of such period or whose election as a member of such Board of
Directors was previously so approved; (e) Holdings shall cease to own, directly
or indirectly, 100% of the issued and outstanding shares of Capital Stock of
the Canadian Borrower while any Canadian Tranche Loans are outstanding or any
Canadian Allocated Commitments remain in effect; or (f) Holdings shall
cease to own, directly or indirectly, 100% of the issued and outstanding shares
of Capital Stock of UCI.


 


“Closing Date” shall mean January 14, 2005.


 


“Code” shall mean the Internal Revenue Code of
1986, as amended from time to time and any successor statute.


 


“Collateral” shall mean all Property of the US
Borrowers and the Subsidiary Guarantors which is secured by a Lien under the
Security Instruments.


 


“Combined Revolving Credit Exposure” shall mean
at any time, the sum of (a) the US Tranche Credit Exposure at such time, and
(b) the Canadian Tranche Credit Exposure at such time.


 


“Commitment Fees” shall mean collectively, the
Canadian Commitment Fee and the US Commitment Fee.


 


“Compression Collateral” shall mean Holdings’
and UCI’s domestic compressor units located in the continental United States
and subject to a first priority lien in favor of the US Administrative Agent
for the benefit of the Lenders, excluding all such assets that are (a)
manufactured pursuant to a purchase order solely for sale to a third party, (b)
characterized as work-in-progress or (c) obsolete.


 


“Confidential
Information” shall have the meaning assigned such term in Section 13.15.


 


“Congress Financial” shall mean Congress
Financial Corporation (Canada) and its successors.


 


“Consolidated Net Income” shall mean for any
period, the aggregate of the net income (or loss) of Holdings and its
Consolidated Subsidiaries after allowances for taxes for such period,
determined on a consolidated basis in accordance with GAAP; provided
that there shall be excluded from such net income (to the extent otherwise
included therein) the following: 
(a) the


 


10





















 


net income of any Person in
which Holdings or any Consolidated Subsidiary has an interest (which interest
does not cause the net income of such other Person to be consolidated with the
net income of Holdings and its Consolidated Subsidiaries in accordance with
GAAP), except to the extent of the amount of dividends or distributions
actually paid in such period by such other Person to Holdings or to a
Consolidated Subsidiary, as the case may be; (b) the net income (but not
loss) of any Consolidated Subsidiary to the extent that the declaration or
payment of dividends or similar distributions or transfers or loans by that
Consolidated Subsidiary is not at the time permitted by operation of the terms
of its charter or any agreement, instrument or Governmental Requirement
applicable to such Consolidated Subsidiary, or is otherwise restricted or
prohibited in each case determined in accordance with GAAP; provided
that upon the removal of such restriction, the aggregate net income previously
excluded within the last four (4) fiscal quarters shall be added to the net
income for the same quarters; (c) the net income (or loss) of any Person
acquired in a pooling-of-interests transaction for any period prior to the date
of such transaction; (d) any extraordinary gains or losses, including
gains or losses attributable to Property sales not in the ordinary course of
business; (e) the cumulative effect of a change in accounting principles
and any gains or losses attributable to writeups or write downs of assets; (f)
gains or losses as a result of the early retirement of Debt; and (g) non-cash
gains or losses as a result of foreign currency adjustments.


 


“Consolidated Subsidiaries” shall mean each
Subsidiary of Holdings (whether now existing or hereafter created or acquired)
the financial statements of which shall be (or should have been) consolidated
with the financial statements of Holdings in accordance with GAAP.


 


“Credit Exposure” shall mean at any time for
any Lender (a) for the Canadian Tranche such Lender’s Canadian Tranche Credit
Exposure, (b) for the US Tranche such Lender’s US Tranche Credit Exposure and
(c) for the Term Tranche such Lender’s Term Credit Exposure.


 


“DBNA” shall mean the Depository Bills and
Notes Act (Canada).


 


“Debt” shall mean, for any Person the sum of
the following (without duplication): 
(a) all obligations of such Person (whether created or assumed) for
borrowed money or evidenced by bonds, debentures, notes or other similar
instruments; (b) all obligations of such Person (whether contingent or
otherwise) in respect of bankers’ acceptances, letters of credit, surety or
other bonds and similar instruments; (c) all obligations of such Person to
pay the deferred purchase price of Property or services (other than for
borrowed money); (d) all Capital Lease Obligations in respect of which
such Person is liable (whether contingent or otherwise); (e) all Debt (as
described in the other clauses of this definition) and other obligations of
others secured by a Lien on any asset of such Person, whether or not such Debt
is assumed by such Person; (f) all Debt (as described in the other clauses
of this definition) and other obligations of others guaranteed by such Person
or in which such Person otherwise assures a creditor against loss of the debtor
or obligations of others; (g) all obligations or undertakings of such
Person to maintain or cause to be maintained the financial position or
covenants of others or to purchase the Debt or Property of others;
(h) obligations to deliver goods or services in consideration of advance
payments in excess of the sum of (A) $25,000,000 outstanding at any time and
(B) up to an additional $25,000,000 outstanding at any time if such amount is
approved in writing by the US Administrative Agent from time to time; (i) obligations
to pay for goods or services whether or not such goods or services are actually
received or utilized by such Person; (j) any capital stock of such Person
in which such Person has a mandatory obligation to redeem such stock;
(k) any


 


11





















 


Debt of a Special Entity for
which such Person is liable either by agreement or because of a Governmental
Requirement; and (l) all net mark to market obligations of such Person
under Hedging Agreements.


 


“Default” shall mean an Event of Default or an
event which with notice or lapse of time or both would become an Event of
Default.


 


“Disclosing Parties” shall have the meaning
assigned such term in Section 13.15.


 


“Disposition” shall mean the sale, transfer or
other disposition (including any sale and leaseback transaction) of any
Property by Holdings or any of its Domestic Subsidiaries, including any sale,
assignment, transfer or other disposal, with or without recourse, of any notes
or accounts receivable or any rights and claims associated therewith; provided
that “Disposition” will not include those dispositions set forth in Sections
10.14(a), (b), (c), (d) and up to $25,000,000 of the
dispositions set forth in Section 10.14(e).


 


“Domestic Subsidiary” shall mean each Subsidiary
of Holdings which is not a Foreign Subsidiary.


 


“Drafts” shall mean, at any time, either a
depository bill within the meaning of the DBNA or a bill of exchange within the
meaning of the Bills of Exchange Act (Canada) drawn by the Canadian Borrower on
a Canadian Tranche Revolving Lender but which at such time has not been
completed as to the payee or accepted by such Lender or any other Person.


 


“EBITDA” shall mean, for any period, the sum of
Consolidated Net Income for such period plus the following consolidated
expenses or charges to the extent deducted from Consolidated Net Income in such
period:  Total Interest Expense, taxes,
depreciation, amortization and non-recurring, non-cash charges, provided that
any cash actually paid with respect to such non-cash charges shall be deducted
from EBITDA when paid.  EBITDA will be:


 


(a)                                  adjusted
on a pro forma basis (reasonably acceptable to the US Administrative Agent) for
acquisitions and divestitures including projected synergies; and


 


(b)                                 calculated
on a rolling four-quarter basis.


 


“8 7/8% Notes” shall mean those certain 8 7/8%
senior secured notes due 2008 issued pursuant to that certain Indenture dated
as of February 9, 2001 among BRL Universal Equipment 2001 A, L.P., BRL
Universal Equipment Corp. and The Bank of New York.


 


“Environmental Laws” shall mean any and all
Governmental Requirements pertaining to health or the environment in effect in
any and all jurisdictions in which Holdings or any Subsidiary is conducting or
at any time has conducted business, or where any Property of Holdings or any
Subsidiary is located, including without limitation, the Canadian Environmental
Assessment Act, the Canadian Environmental Protection Act, the Environmental
Assessment Act (Ontario) and the Environmental Protection Act (Ontario), the
Oil Pollution Act of 1990 (“OPA”), the Clean Air Act, as amended, the
Comprehensive Environmental, Response, Compensation, and Liability Act of 1980
(“CERCLA”), as amended, the Federal Water Pollution Control Act, as
amended, the Occupational Safety and Health Act of 1970, as amended, the


 


12





















 


Resource Conservation and
Recovery Act of 1976 (“RCRA”), as amended, the Safe Drinking Water Act,
as amended, the Toxic Substances Control Act, as amended, the Superfund
Amendments and Reauthorization Act of 1986, as amended, the Hazardous Materials
Transportation Act, as amended, and other environmental conservation or
protection laws.  The term “oil” shall
have the meaning specified in OPA, the terms “hazardous substance” and “release”
(or “threatened release”) have the meanings specified in CERCLA, and the terms “solid
waste” and “disposal” (or “disposed”) have the meanings specified in RCRA; provided,
however, that (a) in the event either OPA, CERCLA or RCRA is
amended so as to broaden the meaning of any term defined thereby, such broader
meaning shall apply subsequent to the effective date of such amendment and
(b) to the extent the laws of the state in which any Property of Holdings
or any Subsidiary is located establish a meaning for “oil,” “hazardous
substance,” “release,” “solid waste” or “disposal” which is broader than that
specified in either OPA, CERCLA or RCRA, such broader meaning shall apply.


 


“ERISA” shall mean the Employee Retirement Income
Security Act of 1974, as amended from time to time.


 


“ERISA Affiliate” shall mean any trade or
business (whether or not incorporated) that, together with Holdings or any
Subsidiary, is treated as a single employer under Section 414(b) or (c) of the Code
or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is
treated as a single employer under Section 414 of the Code.


 


“ERISA Event” shall mean (a) any “reportable
event”, as defined in Section 4043 of ERISA or the regulations issued
thereunder with respect to a Plan (other than an event for which the 30 day
notice period is waived); (b) the existence with respect to any Plan of an “accumulated
funding deficiency” (as defined in Section 412 of the Code or Section 302 of
ERISA), whether or not waived; (c) the filing pursuant to Section 412(d) of the
Code or Section 303(d) of ERISA of an application for a waiver of the minimum
funding standard with respect to any Plan; (d) the incurrence by Holdings, any
Subsidiary or any of its ERISA Affiliates of any liability under Title IV of
ERISA with respect to the termination of any Plan; (e) the receipt by Holdings,
any Subsidiary or any ERISA Affiliate from the PBGC or a plan administrator of
any notice relating to an intention to terminate any Plan or Plans or to
appoint a trustee to administer any Plan; (f) the incurrence by Holdings, any
Subsidiary or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g)
the receipt by Holdings, any Subsidiary or any ERISA Affiliate of any notice,
or the receipt by any Multiemployer Plan from Holdings, any Subsidiary or any
ERISA Affiliate of any notice, concerning the imposition of Withdrawal
Liability or a determination that a Multiemployer Plan is, or is expected to
be, insolvent or in reorganization, within the meaning of Title IV of ERISA.


 


“Event of Default” shall have the meaning
assigned such term in Section 11.01.


 


“Excepted Liens” shall mean:  (a) Liens for taxes, assessments or
other governmental charges or levies not yet due or which are being contested
in good faith by appropriate action and for which adequate reserves have been
maintained; (b) Liens in connection with workmen’s compensation,
unemployment insurance or other social security, old age pension or public
liability obligations not yet due or which are being contested in good faith by
appropriate action and for which adequate reserves have been maintained in
accordance with GAAP; (c) operators’,


 


13





















 


vendors’, carriers’,
warehousemen’s, repairmen’s, mechanics’, workmen’s, materialmen’s, construction
or other like Liens arising by operation of law in the ordinary course of
business or statutory landlord’s liens, each of which is in respect of
obligations that have not been outstanding more than 90 days or which are
being contested in good faith by appropriate proceedings and for which adequate
reserves have been maintained in accordance with GAAP; (d) any Liens
reserved in leases for rent or royalties and for compliance with the terms of
the leases in the case of leasehold estates, to the extent that any such Lien
referred to in this clause does not materially impair the use of the
Property covered by such Lien for the purposes for which such Property is held
by Holdings or any Subsidiary or materially impair the value of such Property
subject thereto; (e) encumbrances (other than to secure the payment of
borrowed money or the deferred purchase price of Property or services),
easements, restrictions, servitudes, permits, conditions, covenants, exceptions
or reservations in any rights of way or other Property of Holdings or any
Subsidiary for the purpose of roads, pipelines, transmission lines,
transportation lines, distribution lines for the removal of gas, oil, coal or
other minerals or timber, and other like purposes, or for the joint or common
use of real estate, rights of way, facilities and equipment, and defects,
irregularities, zoning restrictions and deficiencies in title of any rights of
way or other Property which in the aggregate do not materially impair the use
of such rights of way or other Property for the purposes of which such rights
of way and other Property are held by Holdings or any Subsidiary or materially
impair the value of such Property subject thereto; (f) deposits of cash or
securities to secure the performance of bids, trade contracts, leases,
performance bonds, surety and appeal bonds, statutory obligations and other
obligations of a like nature incurred in the ordinary course of business;
(g) Liens permitted by the Security Instruments; (h) Liens arising out of
fully bonded or insured judgments; and (i) Liens for Holdings’ or any
Subsidiary’s title to Property leased under Capital Leases; provided
that no intention to subordinate the first priority Lien granted in favor of
the US Administrative Agent and the Lenders is to be hereby implied or
expressed by the permitted existence of such Excepted Liens.


 


“Exchange Act” shall mean the Securities
Exchange Act of 1934, as amended, or any successor statute or statutes thereto.


 


“Existing Letters of Credit” shall mean those
letters of credit listed on attached Schedule 2.01(b) and all
reimbursement obligations pertaining to any such letter of credit.


 


“Existing Tranche B Loan Facility” shall mean
that certain term loan pursuant to that certain Tranche B Loan Agreement, dated
as of February 9, 2001 among BRL Universal Equipment 2001 A., L.P., Bankers
Trust Company and the tranche B lenders party thereto.


 


“Extraordinary Receipts” shall mean any cash
received by Holdings or any of its Subsidiaries from (a) proceeds of any
property or casualty insurance and (b) condemnation awards (and payments in
lieu thereof); provided, however, that, so long as no Event of
Default has occurred and is continuing, an Extraordinary Receipt shall not
include any cash receipts that do not exceed, individually or in the aggregate
in any fiscal year, $10,000,000.


 


“Federal Funds Rate” shall mean, for any day,
the rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%)
equal to the weighted average of the rates on overnight federal funds
transactions with a member 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


 


14





















 


Business Day next succeeding
such day, provided that (a) if the date for which such rate is to
be determined 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 (b) if such rate is not
so published for any day, the Federal Funds Rate for such day shall be the
average rate charged to the US Administrative Agent on such day on such
transactions as determined by the US Administrative Agent.


 


“Fee Letter” shall mean that certain letter
agreement from Wachovia and JPMorgan to the Borrowers dated December 6, 2004,
concerning certain fees in connection with this Agreement and any agreements or
instruments executed in connection therewith, as the same may be amended or
replaced from time to time.


 


“Financial Statements” shall mean the financial
statement or statements of Holdings and its Consolidated Subsidiaries described
or referred to in Section 7.02.


 


“First Rate” shall have the meaning assigned
such term in Section 3.02(b)(i).


 


“Foreign Credit Facility” shall mean any credit
facility (other than pursuant to this Agreement) of any Subsidiary of Holdings
(i) whose jurisdiction of incorporation is other than the United States of
America, any State thereof, the District of Columbia or any possession thereof
and (ii) which derives substantially all of its income from jurisdictions other
than the United States of America.


 


“Foreign Subsidiary” shall mean each Subsidiary
of Holdings that is incorporated under the laws of any jurisdiction other than
the United States of America, any State thereof, or any territory thereof.


 


“GAAP” shall mean generally accepted accounting
principles in the United States of America in effect from time to time.


 


“Governmental Authority” shall include the
country, state, province, county, city and political subdivisions in which any
Person or such Person’s Property is located or which exercises valid
jurisdiction over any such Person or such Person’s Property, and any court,
agency, department, commission, board, bureau or instrumentality of any of them
including monetary authorities which exercises valid jurisdiction over any such
Person or such Person’s Property.  Unless
otherwise specified, all references to Governmental Authority herein shall mean
a Governmental Authority having jurisdiction over, where applicable, Holdings,
its Subsidiaries or any of their Property or any Administrative Agent, any
Lender or any Applicable Lending Office.


 


“Governmental Requirement” shall mean any law,
statute, code, ordinance, order, determination, rule, regulation, judgment,
decree, injunction, franchise, permit, certificate, license, authorization or
other directive or requirement (whether or not having the force of law),
including, without limitation, Environmental Laws, energy regulations and
occupational, safety and health standards or controls, of any Governmental Authority.


 


“Guarantee and Collateral Agreement” shall mean
that certain Guarantee and Collateral Agreement that may be executed by
Significant Domestic Subsidiaries in favor of the US


 


15





















 


Administrative Agent as
required by Section 9.09(a) in a form to be agreed upon by the US
Borrowers and the US Administrative Agent, as amended, modified or restated
from time to time.


 


“Guaranteed Obligations” shall have the meaning
assigned such term in Section 14.01(a).


 


“Guaranty” shall mean the guaranty by the US
Borrowers contained in ARTICLE XIV.


 


“Hedging Agreements” shall mean any commodity,
interest rate or currency swap, cap, floor, collar, forward agreement or other
exchange or protection agreements or any option with respect to any such
transaction entered into from time to time.


 


“Highest Lawful Rate” shall mean, with respect
to each Lender, the maximum nonusurious interest rate, if any, that at any time
or from time to time may be contracted for, taken, reserved, charged or
received on the Loans or on other Indebtedness under the Loan Documents under
laws applicable to such 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.


 


“Indebtedness” shall mean (without
duplication), unless the context indicates otherwise, any and all amounts owing
or to be owing by the Borrowers to any of the Administrative Agents, the
Issuing Banks, the Lenders and/or any Lender Affiliate in connection with the
Loan Documents and the Letter of Credit Applications, and any Hedging
Agreements now or hereafter arising between any Borrower or any Subsidiary of a
Borrower and any Lender or any Lender Affiliate and permitted by the terms of
this Agreement, excluding any Hedging Agreements now or hereafter arising in
connection with the ABS Facility, and all renewals, extensions and/or
rearrangements of any of the foregoing.


 


“Indemnified Parties” shall have the meaning
assigned such term in Section 13.03(a)(ii).


 


“Indemnity Matters” shall mean any and all
actions, suits, proceedings (including any investigations, litigation or
inquiries), claims, demands and causes of action made or threatened against a
Person and, in connection therewith, all losses, liabilities, damages
(including, without limitation, consequential damages) or reasonable costs and
expenses of any kind or nature whatsoever incurred by such Person whether
caused by the sole or concurrent negligence of such Person seeking
indemnification.


 


“Index Debt” shall mean the senior secured indebtedness for borrowed
money of either Holdings or UCI that is not guaranteed by any other Person
except for Holdings, UCI or a Subsidiary Guarantor or subject to any other
credit enhancement; provided, that if Holdings or UCI does not have any
such indebtedness, Index Debt shall be the Indebtedness under the Revolving
Credit Facility and the Term Loan B Facility.


 


“Interest Coverage Ratio” shall mean the ratio
of (a) EBITDA for the applicable Testing Period to (b) Total Interest
Expense for the applicable Testing Period excluding gains or losses as a result
of the early retirement of Debt; provided,  however, for the (i)
first fiscal quarter period ending on March 31, 2005, the interest expense for
such quarter times four (4) shall be utilized; (ii) second fiscal quarter
period commencing on April 1, 2005 and ending on June 30, 2005, the 


 


16





















 


interest expense for such
fiscal quarter times four (4) shall be utilized; (iii) third fiscal
quarter period commencing on April 1, 2005 and ending on September 30, 2005,
the interest expense for such six month period times two (2) shall be utilized;
and (iv) fourth fiscal quarter period commencing on April 1, 2005 and
ending on December 31, 2005, the interest expense for such nine month period
divided by three (3) then multiplied times four (4) shall be utilized.


 


“Interest Period” shall mean with respect to
any US Dollar LIBOR Loan, the period commencing on the date such US Dollar
LIBOR Loan is made and ending on the numerically corresponding day in the
first, second, third or sixth calendar month thereafter, as the Applicable
Borrower may select as provided in Section 2.02 (or such longer
period as may be requested by the Applicable Borrower and agreed to by all
Lenders), except that each Interest Period which commences on the last Business
Day of a calendar month (or on any day for which there is no numerically
corresponding day in the appropriate subsequent calendar month) shall end on
the last Business Day of the appropriate subsequent calendar month.


 


Notwithstanding the foregoing:  (a) no Interest Period for a Revolving
Borrowing may end after the Revolving Credit Maturity Date; (b) no Interest
Period for a Term Loan Borrowing may end after the Term Loan Maturity Date;
(c) no Interest Period for a Term Loan Borrowing shall be selected which
extends beyond any date upon which an installment of the Term Loan will be due
if such Term Loan Borrowing must be used to make such installment; (d) each
Interest Period which would otherwise end on a day which is not a Business Day
shall end on the next succeeding Business Day (or, if such next succeeding
Business Day falls in the next succeeding calendar month, on the next preceding
Business Day); (e) no Interest Period shall have a duration of less than
one month and, if the Interest Period for any US Dollar LIBOR Loans would
otherwise be for a shorter period, such Loans shall not be available hereunder;
(f) the first interest period commencing on the Term Loan Funding Date shall be
for a period from the Term Loan Funding Date until February 28, 2005; and (g)
the last Interest Period may be such shorter period as to end on the Term Loan
Maturity Date.  “Interest Period”
shall mean with respect to any Bankers’ Acceptance or BA Equivalent Loan, the
period selected by the Canadian Borrower as provided in Section 2.12(a)
commencing on the day on which such Borrowing is made and ending on the
applicable BA Maturity Date.


 


“Investment” shall mean, as applied to any
Person, any direct or indirect (a) purchase or other acquisition by such Person
of any Capital Stock, Debt or other securities (including any option, warrant
or other right to acquire any of the foregoing) of any other Person, (b) loan
or advance made by such Person to any other Person, (c) guarantee, assumption
or other incurrence of liability by such Person of or for any Debt or other
obligation of any other Person, (d) creation of any Debt owed to such Person by
any other Person, (e) capital contribution or other investment by such Person
in any other Person or (f) purchase or other acquisition (in one transaction or
a series of transactions) of any assets of any other Person constituting a
business unit.  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
or interest earned on such Investment.  “Investment”
shall exclude extensions of trade credit by the US Borrowers and their
Subsidiaries on commercially reasonable terms in accordance with normal trade
practices of the US Borrowers or such Subsidiary, as the case may be.


 


17





















 


“Issuing Banks” shall mean, for any Letters of
Credit issued on or after the Closing Date, Wachovia, JPMorgan or any other
Lender agreed to among the US Borrowers, the US Administrative Agent and such
US Tranche Revolving Lender to issue Letters of Credit.  As to the Existing Letters of Credit, the
Issuing Bank for each Existing Letter of Credit shall be as set forth on Schedule 2.01(b).


 


“JPMorgan” shall mean JPMorgan Chase Bank, N.A.
and its successors.


 


“LC Exposure” shall mean at any time, the sum
of (a) the aggregate undrawn amount of all outstanding Letters of Credit issued
for the account of the US Borrowers at such time, plus (b) the aggregate
amount of all disbursements that the US Borrowers are obligated to reimburse
(other than pursuant to the Guaranty) but which have not yet been reimbursed by
or on behalf of the US Borrowers at such time. 
The LC Exposure of any US Tranche Revolving Lender at any time shall be
equal to its applicable US Tranche Percentage of the total LC Exposure at such
time.


 


“Lender Affiliate” shall mean (a) with
respect to any Lender (i) an Affiliate of such Lender or (ii) any
entity (whether a corporate, partnership, trust or otherwise) that is engaged
in making, purchasing, holding or otherwise investing in bank loans and similar
extensions of credit in the ordinary course of its business and is administered
or managed by a Lender or an Affiliate of such Lender and (b) with respect
to any Lender that is a fund which invests in bank loans and similar extensions
of credit and is managed by the same investment advisor as such Lender or by an
Affiliate of such investment advisor.


 


“Lender Termination Date” shall have the meaning
assigned such term in Section 5.06(c).


 


“Letter of Credit Application” shall mean a
letter of credit application, in the form of Exhibit F, delivered
to the US Administrative Agent requesting the issuance, reissuance, extension
or renewal of any Letter of Credit and containing the information set forth in Section 2.02(g).


 


“Letters of Credit” shall mean the Existing
Letters of Credit, and the letters of credit issued pursuant to Section 2.01(b)
and all reimbursement obligations pertaining to any such letters of credit, and
“Letter of Credit” shall mean any one of the Letters of Credit and the
reimbursement obligations pertaining thereto, and shall include Offshore
Currency Letters of Credit.


 


“Lien” shall mean any interest in Property
securing an obligation owed to, or a claim by, a Person other than the owner of
the Property, whether such interest is based on the common law, statute or
contract, and whether such obligation or claim is fixed or contingent, and
including but not limited to the lien or security interest arising from a
mortgage, encumbrance, pledge, security agreement, conditional sale or trust
receipt or a lease, consignment or bailment for security purposes.  The term “Lien” shall include
reservations, exceptions, encroachments, easements, rights of way, covenants,
conditions, restrictions, leases and other title exceptions and encumbrances
affecting Property.  For the purposes of
this Agreement, Holdings or any Subsidiary shall be deemed to be the owner of
any Property which it has acquired or holds subject to a conditional sale
agreement, or leases under a financing lease or other arrangement


 


18





















 


pursuant to which title to the
Property has been retained by or vested in some other Person in a transaction
intended to create a financing.


 


“Loan Documents” shall mean this Agreement, the
Notes and the Security Instruments.


 


“Loans” shall mean the loans as provided for by
Section 2.01 and Section 2.12.


 


“Major Project” shall mean any transaction
contemplated to be entered into by Holdings or any Subsidiary equal to or in
excess of $5,000,000.


 


“Major Schedule I Lenders” shall mean
collectively, The Bank of Montreal, The Bank of Nova Scotia, Canadian Imperial
Bank of Commerce and Royal Bank of Canada.


 


“Majority Lenders” shall mean, at any time,
Lenders having more than 50% of the Aggregate Credit Exposure plus the unused
Aggregate Commitments.


 


“Market Value” shall have the meaning assigned
such term in Section 10.13(c).


 


“Material Adverse Effect” shall mean any
material and adverse effect on (a) the assets, liabilities, financial
condition, business, operations or prospects of Holdings and its Subsidiaries
taken as a whole as reflected in the Financial Statements or (b) the
ability of Holdings and its Subsidiaries taken as a whole to perform their
obligations under the Loan Documents on a timely basis.


 


“Material Foreign Subsidiary” shall mean any
Foreign Subsidiary with gross assets, excluding the value of the stock of all
of its Subsidiaries, exceeding $20,000,000.


 


“Material Subsidiary” shall mean any Domestic
Subsidiary with gross assets, excluding the value of the stock of all of its
Subsidiaries, exceeding $5,000,000.


 


“Moody’s”
shall mean Moody’s Investors Services, Inc.


 


“Multiemployer Plan” shall mean a multiemployer
plan as defined in Section 4001(a)(3) of ERISA.


 


“Net Proceeds” shall mean, with respect to any
Disposition, issuance of Debt or Extraordinary Receipts, the gross amount
received by Holdings or any of its Subsidiaries from such Disposition, issuance
of Debt or Extraordinary Receipts, minus the sum of (a) the amount, if
any, of all taxes paid or payable by Holdings or any of its Subsidiaries
directly resulting from such Disposition, issuance of Debt or Extraordinary
Receipts (including the amount, if any, estimated by Holdings in good faith at
the time of such Disposition, issuance of Debt or Extraordinary Receipts for
taxes payable by Holdings or any of its Subsidiaries on or measured by net
income or gain resulting from such Disposition, issuance of Debt or
Extraordinary Receipts), (b) the reasonable out-of-pocket costs and expenses
incurred by Holdings or such Subsidiary in connection with such Disposition,
issuance of Debt or Extraordinary Receipts (including, without limitation, reasonable
brokerage fees paid to a Person other than an Affiliate of Holdings, but
excluding any fees or expenses paid to an Affiliate of Holdings), (c)
appropriate amounts required to be reserved (in accordance with GAAP) for
post-closing adjustments by Holdings or any of its Subsidiaries in connection
with such Disposition, against any liabilities


 


19





















 


retained by Holdings or any of
its Subsidiaries after such Disposition, which liabilities are associated with the
Property being disposed, including, without limitation, pension and other
post-employment benefit liabilities and liabilities related to environmental
matters or against any indemnification obligations associated with such
Disposition and (d) deduction for Debt secured by the Property being
disposed, which Debt is repaid as a result of such Disposition.  Any proceeds received in a currency other
than US Dollars shall, for purposes of the calculation of the amount of Net
Proceeds, be in an amount equal to the US Dollar Equivalent thereof as of the
date of receipt thereof by Holdings or any of its Subsidiaries.


 


“Notes” shall mean the promissory notes
provided for by Section 2.06, together with any and all renewals,
extensions for any period, increases, rearrangements, substitutions or
modifications thereof.


 


“Notice of Termination” shall have the meaning
assigned such term in Section 5.06(a).


 


“Offering Memorandum” shall mean that certain
Offering Memorandum dated December 2004 and pertaining to the $650,000,000
senior secured facilities, consisting of the Revolving Credit Facility and the
Term Loan B Facility.


 


“Offshore Currency” shall mean any lawful
currency (other than US Dollars) that the relevant Issuing Bank with respect to
any Offshore Currency Letter of Credit, in its sole reasonable opinion, at any
time determines to be (a) freely traded in the offshore interbank foreign
exchange markets, (b) freely transferable and (c) freely convertible
into US Dollars.


 


“Offshore Currency Letter of Credit” shall mean
any Letter of Credit denominated in an Offshore Currency.


 


“OPA” shall have the meaning assigned such term
in the definition of Environmental Laws.


 


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


 


“Other Taxes” shall have the meaning assigned
such term in Section 4.06(b).


 


“PBGC” shall mean the Pension Benefit Guaranty
Corporation referred to and defined in ERISA and any successor entity
performing similar functions.


 


20





















“Percentage Share” shall mean for each US
Tranche Revolving Lender, its US Tranche Percentage, for each Canadian Tranche
Revolving Lender, its Canadian Tranche Percentage and for each Term Loan
Lender, its Term Loan Percentage.


 


“Permitted Acquisition Category 1” shall mean
an acquisition by Holdings or any of its Subsidiaries (in one transaction or a
series of transactions) of any assets of any other Person constituting a
business unit or the Capital Stock of any Person, if after giving effect to
such acquisition on a pro forma basis as if such acquisition (and all other
acquisitions made during such period) had been made and the Debt financing such
acquisition (and all other Debt financing all other acquisitions made during
such period) had been incurred at the beginning of the four quarter Testing
Period most recently ended, the Total Leverage Ratio for such Testing Period
would equal or exceed 3.50 to 1.00.


 


“Permitted Acquisition Category 2” shall mean
an acquisition by Holdings or any of its Subsidiaries (in one transaction or a
series of transactions) of any assets of any other Person constituting a
business unit or the Capital Stock of any Person, if after giving effect to
such acquisition on a pro forma basis as if such acquisition (and all other acquisitions
made during such period) had been made and the Debt financing such acquisition
(and all other Debt financing all other acquisitions made during such period)
had been incurred at the beginning of the four quarter Testing Period most
recently ended, the Total Leverage Ratio for such Testing Period would be less
than 3.50 to 1.00.


 


“Permitted Acquisition Debt” means Debt of
Holdings or any of its Subsidiaries, the proceeds of which are used for either
a Permitted Acquisition Category 1 or Permitted Acquisition Category 2; provided
that such Debt exceeding $25,000,000 in the aggregate has a scheduled maturity
date that is later than the Term Loan Maturity Date and does not contain
financial covenant ratios more restrictive or events of default that are materially more restrictive than those
contained herein; provided further that for any Permitted Acquisition
Category 1, the principal amount of Permitted Acquisition Debt of the US
Borrowers shall not exceed $150,000,000 outstanding at any time.


 


“Permitted Liens” shall have the meaning
assigned such term in Section 10.02.


 


“Person” shall mean any individual,
corporation, company, voluntary association, partnership, joint venture, trust,
unincorporated organization or government or any agency, instrumentality or
political subdivision thereof, or any other form of entity.


 


“Plan” shall mean any employee pension benefit
plan (other than a Multiemployer Plan) subject to the provisions of Title IV of
ERISA or Section 412 of the Code or Section 302 of ERISA, and in respect of
which Holdings, any Subsidiary or any ERISA Affiliate is (or, if such plan were
terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as
defined in Section 3(5) of ERISA.


 


“Post-Default Rate” shall mean, in respect of any
principal of any Loan or any other amount payable by a Borrower under this
Agreement or any other Loan Document, a rate per annum during the period equal
to 2% per annum above the US Dollar Base Rate for US Tranche Loans and the
Canadian Prime Rate for Canadian Tranche Loans as in effect from time to time
plus the Applicable Margin (if any), but in no event to exceed the Highest
Lawful Rate; provided


 


21





















 


however,
for US Dollar LIBOR Loans, the “Post-Default Rate” for such principal
shall be, for the period commencing on the date of occurrence of an Event of
Default and ending on the earlier to occur of the last day of the Interest
Period therefor or the date all Events of Default are cured or waived, 2% per
annum above the interest rate for such Loan as provided in Section 3.02(a),
but in no event to exceed the Highest Lawful Rate.


 


“Price” shall have the meaning assigned such
term in the definition of BA Net Proceeds.


 


“Principal Amount” shall mean for a Bankers’
Acceptance, the face amount thereof, for a BA Equivalent Loan, the principal
amount thereof determined in accordance with Section 2.12(g) and for any
other Loans and the LC Exposure, the outstanding principal amount thereof.


 


“Principal Offices” shall mean collectively,
the Canadian Principal Office and the US Principal Office.


 


“Property” shall mean any interest in any kind
of property or asset, whether real, personal or mixed, or tangible or
intangible.


 


“Purchase Money Indebtedness” shall mean debt,
the proceeds of which are used to finance the acquisition, construction or
improvement of inventory, equipment or other property in the ordinary course of
business.


 


“Quarterly Date” shall mean the last day of
each March, June, September and December, in each year, the first of which
shall be March 31, 2005; provided, however, that if any such
day is not a Business Day, such Quarterly Date shall be the immediately
preceding Business Day.


 


“RCRA” shall have the meaning assigned such
term in the definition of Environmental Laws.


 


“Recipient” shall have the meaning assigned
such term in Section 4.06(a).


 


“Register” shall have the meaning assigned such
term in Section 13.06(b).


 


“Regulation D” shall mean
Regulation D of the Board of Governors of the Federal Reserve System (or
any successor), as the same may be amended or supplemented from time to time.


 


“Regulatory Change” shall mean, with respect to
any Lender, any change after the Closing Date in any Governmental Requirement
(including Regulation D) or the adoption or making after such date of any
interpretations, directives or requests applying to a class of lenders
(including such Lender or its Applicable Lending Office) of or under any
Governmental Requirement (whether or not having the force of law) by any
Governmental Authority charged with the interpretation or administration
thereof.


 


“Related Fund” shall mean, with respect to any
Term Loan Lender that is a fund that invests in bank loans, any other fund that
invests in bank loans and is advised or managed by the same investment advisor
as such Term Loan Lender or by an Affiliate (as defined in clause (a) only of
the definition of “Affiliate”) of such investment advisor.


 


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“Replacement Lenders” shall have the meaning
assigned such term in Section 5.06(b).


 


“Requesting Borrower” shall mean either the US
Borrowers or the Canadian Borrower, as applicable, requesting a Loan.


 


“Reserve Account” shall have the meaning
assigned such term in Section 11.03(a).


 


“Reserve Requirement” shall mean, for any
Interest Period for any US Dollar LIBOR Loan, the average maximum rate at which
reserves (including any marginal, supplemental or emergency reserves) are
required to be maintained during such Interest Period under Regulation D
by member banks of the Federal Reserve System in New York City with deposits
exceeding one billion US Dollars against “Eurocurrency liabilities” (as such
term is used in Regulation D). 
Without limiting the effect of the foregoing, the Reserve Requirement
shall reflect any other reserves required to be maintained by such member banks
by reason of any Regulatory Change against (a) any category of liabilities
which includes deposits by reference to which US LIBOR is to be determined as provided
in the definition of “US LIBOR” or (b) any category of extensions
of credit or other assets which include a US Dollar LIBOR Loan.


 


“Responsible Officer” shall mean, as to any
Person, the Chief Executive Officer, the President or any Vice President of such
Person and, with respect to financial matters, the term “Responsible Officer”
shall include the Chief Financial Officer and Vice President of Financial
Services of such Person.  Unless
otherwise specified, all references to a Responsible Officer herein shall mean
a Responsible Officer of any Borrower.


 


“Restricted Person” shall have the meaning
assigned such term in Section 13.15.


 


“Revolving Borrowing” shall mean a Borrowing
comprised of Revolving Loans.


 


“Revolving Credit Facility” shall mean
collectively, the US Tranche and the Canadian Tranche.


 


“Revolving Credit Maturity Date” shall mean the
earlier to occur of (a) January 14, 2010 or (b) the date that the
Aggregate Revolving Commitments are sooner terminated pursuant to Sections 2.03(b)
or 11.02.


 


“Revolving Existing Indebtedness” shall mean
all indebtedness under the Existing Credit Agreement and the Existing Tranche B
Loan Facility.


 


“Revolving Loans” shall mean Loans made under
the Revolving Credit Facility.


 


“Revolving Notes” shall mean Notes issued
pursuant to Section 2.06 evidencing Loans under the Revolving Credit
Facility.


 


“SEC” shall mean the Securities and Exchange
Commission or any successor Governmental Authority.


 


“Security Instruments” shall mean the Letters
of Credit, the Fee Letter, the agreements or instruments described or referred
to in Exhibit D, and any and all other agreements or instruments
now or hereafter executed and delivered by a Borrower or any other Person
(other


 


23





















 


than participation or similar
agreements between any Lender and any other lender or creditor with respect to
any Indebtedness pursuant to this Agreement) in connection with, or as security
for the payment or performance of the Notes, or this Agreement, or reimbursement
obligations under the Letters of Credit, as such agreements may be amended,
supplemented or restated from time to time.


 


“7 1⁄4% Notes” shall mean those certain unsecured
7 1⁄4% senior notes due 2010 issued pursuant to that certain Indenture dated as
of May 27, 2003 between UCI and The Bank of New York, as amended, modified,
supplemented or restated from time to time.


 


“Significant Domestic Subsidiary” shall mean
each wholly-owned Domestic Subsidiary with gross assets, excluding the value of
the stock of all of its Subsidiaries, exceeding $50,000,000.  If the gross asset value of the Domestic
Subsidiaries that are not Subsidiary Guarantors exceeds $75,000,000 in the
aggregate, those Domestic Subsidiaries holding a majority of those assets shall
each be a Significant Domestic Subsidiary. 
Notwithstanding the foregoing to the contrary, any Subsidiary involved
in or created in connection with or as a requirement of and still used in
connection with the ABS Facility shall be excluded from the application of this
definition of a Significant Domestic Subsidiary.


 


“Special Entity” shall mean any joint venture,
limited liability company or partnership, general or limited partnership or any
other type of partnership or company other than a corporation in which Holdings
or one or more of its other Subsidiaries is a member, owner, partner or joint
venturer and owns, directly or indirectly, at least a majority of the equity of
such entity or controls such entity, but excluding any tax partnerships that
are not classified as partnerships under state law.  For purposes of this definition, any Person
which owns directly or indirectly an equity investment in another Person which
allows the first Person to manage or elect managers who manage the normal
activities of such second Person will be deemed to “control” such second Person
(e.g. a sole general partner controls a limited partnership).


 


“S&P” shall mean Standard & Poors
Ratings Group, a division of The McGraw-Hill Companies, Inc.


 


“Subsidiary” shall mean (a) any corporation
of which at least a majority of the outstanding shares of stock having by the
terms thereof ordinary voting power to elect a majority of the board of
directors of such corporation (irrespective of whether or not at the time stock
of any other class or classes of such corporation shall have or might have
voting power by reason of the happening of any contingency) is at the time
directly or indirectly owned or controlled by Holdings or one or more of its
Subsidiaries and (b) any Special Entity.


 


“Subsidiary Guarantors” shall mean all
Significant Domestic Subsidiaries required to execute the Guarantee and
Collateral Agreement pursuant to Section 9.09.


 


“Taxes” shall have the meaning assigned such
term in Section 4.06(a).


 


“Term” shall mean with respect to Bankers’
Acceptances and BA Equivalent Loans, the number of days from the Acceptance
Date up to but not including the BA Maturity Date.


 


24





















 


“Term Commitments” shall mean with respect to
each Term Loan Lender, the commitment of such Term Loan Lender to make Term
Loans, expressed as an amount representing the maximum aggregate amount of such
Term Loan Lender’s Term Credit Exposure hereunder.  The amount of each Term Loan Lender’s Term
Commitment is set forth on Annex III attached hereto.  Each Term Loan Lender’s Term Commitment shall
terminate immediately after the Term Loan Funding Date.  The aggregate amount of the Term Loan Lenders’
Term Commitments is $400,000,000.


 


“Term Credit Exposure” shall mean with respect
to any Term Loan Lender at any time, the Principal Amount of such Term Loan
Lender’s Term Loans.


 


“Term Loan” shall have the meaning assigned
such term in Section 2.01(a)(v).


 


“Term Loan B Existing Indebtedness” shall mean
the indebtedness under the 8 7/8% Notes.


 


“Term Loan B Facility” shall mean the Term
Commitments and the Term Loans.


 


“Term Loan Borrowing” shall mean a Borrowing
comprised of Term Loans.


 


“Term Loan Funding Date” shall mean February
15, 2005.


 


“Term Loan Lender” shall mean a Lender with an
outstanding Term Loan. Those Persons listed on Annex III and any other
Person that shall have become a party hereto pursuant to an Assignment, other
than any such Person that ceases to be a party hereto pursuant to an
Assignment.


 


“Term Loan Maturity Date” shall mean the
earlier to occur of (a) February 15, 2012 or (b) the date the Term Loans are
accelerated pursuant to Section 11.02.


 


“Term Loan Percentages” shall mean with respect
to any Term Loan Lender, the percentage set forth in the column titled “Term
Loan Percentage” on Annex III for such Term Loan Lender or in the
Assignment pursuant to which such Term Loan Lender becomes a party hereto, as
applicable.


 


“Term Notes” shall mean Notes issued pursuant
to Section 2.06 evidencing Loans under the Term Loan B Facility.


 


“Term Tranche” shall mean the Term Commitments
and the Term Loans.


 


“Terminated Lender” shall have the meaning
assigned such term in Section 5.06(a).


 


“Testing Period” shall mean a single period
consisting of the four consecutive fiscal quarters of Holdings then last ended
(whether or not such quarters are all within the same fiscal year); provided,
however, that if a particular provision of this Agreement indicates that
a Testing Period shall be a different specified duration, such Testing Period
shall consist of the particular fiscal quarter or quarters then last ended
which are so indicated in such provision.


 


25





















 


“Total Debt” shall mean, at any time (without
duplication), the sum of (a) 100% of Debt reflected as debt on the consolidated
balance sheet of Holdings in accordance with GAAP, plus (b) any Debt that is
not reflected on the consolidated balance sheet of Holdings which has been used
to finance assets that generate income included in EBITDA.


 


“Total Interest Expense” shall mean, for any
period, the total consolidated interest expense net of cash interest income of
Holdings and its Consolidated Subsidiaries for such period (including, without
limitation, the cash equivalent of the interest expense associated with Capital
Lease Obligations, but excluding (a) upfront fees paid in connection with
this Agreement, the ABS Facility, the Existing Tranche B Loan Facility, the 8
7/8% Notes or the 7 1⁄4% Notes, (b) Debt or lease issuance costs which
have to be amortized, (c) lease payments on any office equipment or real
property and (d) any principal components paid on all lease payments) plus
rental payments made in connection with the ABS Facility (excluding any
principal amortization components).


 


“Total Leverage Ratio” shall mean the ratio of
Total Debt to EBITDA.


 


“Tranches” shall mean collectively, the
Canadian Tranche, the US Tranche and the Term Tranche.


 


“Type” as to any Loan or Borrowing, its nature
as a US Dollar Base Rate Loan or a US Dollar Base Rate Borrowing, a US Dollar
LIBOR Loan or a US Dollar LIBO Rate Borrowing, a Canadian Prime Rate Loan or a
Canadian Prime Rate Borrowing, a Bankers’ Acceptance or a BA Equivalent Loan, a
Revolving Loan or Revolving Borrowing or a Term Loan or Term Loan Borrowing.


 


“US” or “United States” shall mean the
United States of America, its fifty states, and the District of Columbia.


 


“US Commitment Fee” shall have the meaning
assigned such term in Section 2.04(a).


 


“US Dollar Base Rate” shall mean, with respect
to any US Dollar Base Rate Borrowing, for any day, the higher of (a) the
Federal Funds Rate for any such day plus 1/2 of 1% or (b) the US Prime
Rate for such day.  Each change in any
interest rate provided for herein based upon the US Dollar Base Rate resulting
from a change in the US Dollar Base Rate shall take effect at the time of such
change in the US Dollar Base Rate.


 


“US Dollar Base Rate Loans” shall mean Loans
that bear interest at rates based upon the US Dollar Base Rate.


 


“US Dollar Equivalent” shall mean, at any time
of determination thereof, the amount of US Dollars involved which could be
purchased with the applicable amount of the Alternate Currency involved
computed at the spot rate of exchange as quoted or utilized by the US Administrative
Agent on the date of determination thereof.


 


“US Dollar Equivalent Amount” shall mean at any
Borrowing, conversion or continuation date for any Canadian Tranche Loan, the
amount of US Dollars into which such Canadian Tranche Loan may be converted at
the Bank of Canada noon spot rate of exchange for


 


26





















 


such date in Toronto, Canada at
approximately 12:00 noon, Eastern time on such date.  In addition, the “US Dollar Equivalent
Amount” of all outstanding Canadian Tranche Loans may be calculated at any
time in the sole discretion of the US Administrative Agent and shall equal the
amount of US Dollars into which all outstanding Canadian Tranche Loans may be
converted at the Bank of Canada noon spot rate of exchange for such date in
Toronto, Canada at approximately 12:00 noon, Eastern time on such date.


 


“US Dollar LIBOR Loans” shall mean Loans
denominated in US Dollars that bear interest at a rate based upon the US Dollar
LIBO Rate.


 


“US Dollar LIBO Rate” shall mean, with respect
to any US Dollar LIBO Rate Borrowing, a rate per annum (rounded upwards, if
necessary, to nearest 1/100 of 1%) determined by the US Administrative Agent to
be equal to the quotient of (a) US LIBOR for such Loan for the Interest
Period for such Loan divided by (b) 1 minus the Reserve Requirement for
such Loan for such Interest Period.


 


“US Dollars” and “$” shall mean lawful
money of the United States of America.


 


“US Lender” shall mean a Lender who is either a
US Revolving Tranche Lender or a Term Loan Lender.


 


“US LIBOR” shall mean the rate of interest
determined on the basis of the rate for deposits in US Dollars for a period
equal to the applicable Interest Period commencing on the first day of such
Interest Period appearing on Bridge Telerate Service (formerly Dow Jones Market
Service) Page 3750 as of 11:00 a.m. (London time) two (2) Business
Days prior to the first day of the applicable Interest Period.  In the event that such rate does not appear
on Bridge Telerate Service (formerly
Dow Jones Market Service) Page 3750, “US LIBOR” shall be determined
by the US Administrative Agent to be the rate per annum at which deposits
in US Dollars are offered by leading reference banks in the London interbank
market to the US Administrative Agent at approximately 11:00 a.m. (London time)
two (2) Business Days prior to the first day of the applicable Interest Period
for a period equal to such Interest Period and in an amount substantially equal
to the amount of the applicable Loan.


 


“US Prime Rate” shall mean the rate of interest
per annum publicly announced from time to time by Wachovia as its prime rate at
its US Principal Office.  Each change in
the US Prime Rate shall be effective from and including the date such change is
publicly announced as being effective.


 


“US Principal Office” shall mean the principal
office of the US Administrative Agent, which on the date of this Agreement is
located at 301 South College Street, Charlotte, North Carolina 28288.


 


“US Tranche” shall mean the US Tranche Commitments,
the US Tranche Loans and the LC Exposure.


 


“US Tranche Commitment” shall mean with respect
to each US Tranche Revolving Lender, the commitment of such US Tranche
Revolving Lender to make US Tranche Loans pursuant to Sections 2.01(a)(i)
and to acquire participations in Letters of Credit pursuant to


 


27





















 


Section 2.01(b),
as such commitment may be (a) reduced or terminated from time to time
pursuant to Section 2.03(b), (b) terminated pursuant to Section 5.06
or ARTICLE XI, or (c) modified from time to time to reflect any
assignments permitted by Section 13.06(b); provided, during a
Canadian Allocation Period, the US Tranche Commitment of any US Tranche
Revolving Lender that is or has a branch or Affiliate that is a Canadian
Tranche Revolving Lender shall be reduced by the Canadian Allocated Commitment
of such Canadian Tranche Revolving Lender. 
The initial amount of each US Tranche Revolving Lender’s US Tranche
Commitment shall be the amount set forth on Annex I attached hereto.


 


“US Tranche Credit Exposure” shall mean at any
time, the sum of the aggregate Principal Amount of the US Tranche Loans and LC
Exposure outstanding at such time.  The
US Tranche Credit Exposure of any US Tranche Revolving Lender at any time shall
be such US Tranche Revolving Lender’s US Tranche Percentage of the total US
Tranche Credit Exposure at such time.


 


“US Tranche Loans” shall mean the Revolving
Loans pursuant to Section 2.01(a)(i). 
Each US Tranche Loan shall be either a US Dollar LIBOR Loan or a US
Dollar Base Rate Loan.


 


“US Tranche Percentage” shall mean:


 


(a)                                  at
any time the US Tranche Commitments remain outstanding, a fraction (expressed
as a percentage, carried out to the sixth decimal place), the numerator
of which is the amount of the US Tranche Commitment of such US Tranche
Revolving Lender at such time and the denominator of which is the amount
of the Aggregate US Tranche Commitments at such time; and


 


(b)                                 upon
the termination or expiration of the Aggregate Revolving Commitments, a
fraction (expressed as a percentage, carried out to the sixth decimal place),
the numerator of which is:


 


the sum of


 


(i)                                     the
outstanding amount of US Tranche Loans of such US Tranche Revolving Lender plus


 


(ii)                                  an
amount equal to (A) the outstanding amount of US Tranche Loans of such US
Tranche Revolving Lender, divided by (B) the outstanding amount of US Tranche
Loans of all US Tranche Revolving Lenders, times (C) the LC Exposure, and


 


the denominator of which is the US Tranche
Credit Exposure; provided that if such calculation results in a number
that is zero, then the US Tranche Percentage shall be deemed to be the most
recent US Tranche Percentage immediately prior to the termination or expiration
of the Aggregate Revolving Commitments.


 


The initial US Tranche
Percentage of each US Tranche Revolving Lender is the percentage set forth in
the column titled “US Tranche Percentage” opposite the name of such US Tranche
Revolving Lender on Annex I attached hereto or in the Assignment pursuant
to which such US Tranche Revolving Lender becomes a party hereto, as
applicable.


 


28





















 


“US Tranche Revolving Lender” shall mean a
Lender with a US Tranche Commitment or with outstanding US Tranche Credit Exposure.


 


“USA Patriot Act” shall have the meaning
assigned such in Section 13.19.


 


“Wachovia” shall mean Wachovia Bank, National
Associate and its successors.


 


“Withdrawal Liability” shall mean liability to
a Multiemployer Plan as a result of a complete or partial withdrawal from such
Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title
IV of ERISA.


 


Section 1.03                                Accounting Terms and
Determinations.  Unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
determinations with respect to accounting matters hereunder shall be made, and
all financial statements and certificates and reports as to financial matters
required to be furnished to the Administrative Agents or the Lenders hereunder
shall be prepared, in accordance with GAAP, applied on a basis consistent with
the audited financial statements of Holdings and its Consolidated Subsidiaries
referred to in Section 7.02 (except for changes concurred with by
Holdings and its Consolidated Subsidiaries’ independent public accountants); provided
that, if Holdings notifies the US Administrative Agent that it requests an
amendment to any provision hereof to eliminate the effect of any change
occurring after the date hereof in GAAP (including but not limited to any
Statement of Financial Accounting Standards) affecting the calculation of any
financial covenant (or if the US Administrative Agent notifies Holdings that
the Majority Lenders request an amendment to any provision hereof for such
purpose), regardless of whether any such notice is given before or after such
change in GAAP affecting the calculation of any financial covenant, then such
provision shall be interpreted on the basis of GAAP as in effect and applied
immediately before such change shall have become effective until such notice
shall have been withdrawn or such provision amended in accordance herewith.


 


Section 1.04                                References and
Titles.  All references in this
Agreement to Exhibits, Schedules, articles, sections, subsections and other
subdivisions refer to the Exhibits, Schedules, articles, sections, subsections
and other subdivisions of this Agreement unless expressly provided
otherwise.  Titles appearing at the
beginning of any subdivisions are for convenience only and do not constitute any
part of such subdivisions and shall be disregarded in construing the language
contained in such subdivision.  The words
“this Agreement,” “this instrument,” “herein,” “hereof,” “hereby,” “hereunder”
and words of similar import refer to this Agreement as a whole and not to any
particular subdivision unless expressly so limited.  The phrases “this section” and “this
subsection” and similar phrases refer only to the sections or subsections
hereof in which such phrases occur.  The
word “or” is not exclusive, and the word “including” (in its various forms)
means “including without limitation.” 
Pronouns in masculine, feminine and neuter genders shall be construed to
include any other gender, and words in the singular form shall be construed to
include the plural and vice versa, unless the context otherwise requires.


 


29





















 


ARTICLE II

Commitments


 


Section 2.01                                Loans and Letters of
Credit.


 


(a)                                  Loans.


 


(i)                                     US Tranche
Loans.  Each US Tranche Revolving
Lender severally agrees, on the terms and conditions of this Agreement, to make
Revolving Loans to the US Borrowers during the period from and including
(A) the Closing Date or (B) such later date that such Lender becomes
a party to this Agreement as provided in Section 13.06(b), to and
up to, but excluding, the Revolving Credit Maturity Date in an aggregate
principal amount at any one time outstanding up to, but not exceeding, the
amount of such Lender’s US Tranche Commitment as then in effect, minus
the LC Exposure of such Lender.  Subject
to the terms of this Agreement, during the period from the Closing Date to and
up to, but excluding, the Revolving Credit Maturity Date, the US Borrowers may
borrow, repay and reborrow the amount described in this Section 2.01(a)(i).


 


(ii)                                  Reserved.


 


(iii)                               Canadian Tranche
Loans.  Subject to Section 2.12,
during the period from and including (A) the Closing Date or (B) such
later date that such Lender becomes a party to this Agreement as provided in Section 13.06(b),
to and up to, but excluding, the Revolving Credit Maturity Date, each Canadian Tranche Revolving Lender
severally agrees, on the terms and conditions of this Agreement, (1) to make
Canadian Tranche Loans to the Canadian Borrower in Canadian Dollars or US
Dollars at the election of the Canadian Borrower and (2) to accept and purchase
Bankers’ Acceptances from (or, at the option of the Canadian Tranche Revolving
Lender, make BA Equivalent Loans in lieu of purchasing a Bankers’ Acceptance
to) the Canadian Borrower.  The Canadian
Tranche Loans, if in US Dollars, will be either US Dollar LIBOR Loans or US
Dollar Base Rate Loans and, if in Canadian Dollars, will be either Canadian
Prime Rate Loans, Bankers’ Acceptances or BA Equivalent Loans.  Each Canadian Tranche Revolving Lender’s Canadian
Tranche Credit Exposure shall not exceed the amount of such Lender’s Canadian
Allocated Commitment as then in effect; provided, however, that
the aggregate principal amount of all such Canadian Tranche Loans by all
Canadian Tranche Revolving Lenders hereunder at any one time outstanding shall
not exceed the Canadian Allocated Total Commitments as then in effect.  Within the foregoing limits, the Canadian
Borrower may use the Canadian Allocated Total Commitments by borrowing,
repaying and (except for Bankers’ Acceptances and BA Equivalent Loans)
prepaying the Canadian Tranche Loans in whole or in part, and reborrowing, all
in accordance with the terms and conditions hereof.


 


(iv)                              Maximum Amount of
Loans.  The Combined Revolving Credit
Exposure shall not exceed the Aggregate Revolving Commitments at any time.


 


(v)                                 Term Loans.  Each Term Loan Lender severally agrees,
subject to the terms and conditions set forth herein, to make a senior secured
amortizing term loan (collectively, the “Term Loans”) to the US
Borrowers on the Term Loan Funding Date in


 


30





















 


the principal amount of such Term Loan Lender’s
Term Commitment.  Once repaid or prepaid,
Term Loans may not be reborrowed.


 


(b)                                 Letters of Credit.  During the period from and including the
Closing Date to, but excluding, the 30th day prior to the Revolving Credit
Maturity Date, the Issuing Banks, as issuing bank for the US Tranche Revolving
Lenders, agree to extend credit for the account of the US Borrowers at any time
and from time to time by issuing, renewing, extending or reissuing Letters of
Credit; provided  however, the LC Exposure at any one time
outstanding shall not exceed $125,000,000. 
The US Tranche Revolving Lenders shall participate in such Letters of
Credit according to their respective US Tranche Percentages.  Each of the Letters of Credit shall (1) be
issued by the Issuing Banks on a sight basis only, (2) contain such terms and
provisions as are reasonably required by the Issuing Banks, (3) be for the
account of such US Borrower and (4) expire not later than
(A) 30 days before the Revolving Credit Maturity Date, with respect
to commercial letters of credit, and (B) 10 days before the Revolving
Credit Maturity Date, with respect to standby letters of credit.  The US Borrowers may request that one or more
Letters of Credit be issued in an Offshore Currency denomination as part of the
LC Exposure.  The aggregate US Dollar Equivalent
of all Offshore Currency Letters of Credit, as of the issuance date of any such
Offshore Currency Letter of Credit, shall not exceed $50,000,000.  No Issuing Bank shall be obligated to issue
an Offshore Currency Letter of Credit if such Issuing Bank has determined, in
its sole discretion, that it is unable to fund obligations in the requested
Offshore Currency; provided, however, the US Administrative Agent
shall use its best efforts to locate suitable issuers if no Issuing Banks are
able to fund obligations in the requested Offshore Currency.  From and after the Closing Date, the Existing
Letters of Credit shall be deemed to be Letters of Credit issued pursuant to
this Section 2.01(b).  The
Existing Letters of Credit are described on Schedule 2.01(b).


 


Notwithstanding anything
to the contrary contained in this Agreement, including, without limitation,
this Section 2.01(b), the expiration date of one or more Letters of
Credit may extend beyond the Revolving Credit Maturity Date; provided, however,
it is hereby expressly agreed and understood that:


 


(i)                                     the aggregate face
amount of all such Letters of Credit shall not at any time exceed $25,000,000;


 


(ii)                                  the expiration dates
of such Letters of Credit shall not extend more than three (3) years beyond the
Revolving Credit Maturity Date;


 


(iii)                               the US Borrowers shall,
not later than five (5) Business Days prior to the Revolving Credit Maturity
Date, deposit in an account with the US Administrative Agent, in the name of
the US Administrative Agent for the benefit of the US Administrative Agent and
the Issuing Banks, an amount in cash equal to the aggregate face amount of all
such Letters of Credit as of such date; provided that for all Offshore
Currency Letters of Credit, the US Borrowers shall deposit an amount in cash
equal to 110% of the aggregate face amount of all such Offshore Currency
Letters of Credit and will have a continuing obligation to maintain in such
account at least an amount in cash equal to 110% of the aggregate face amount
of all such Offshore Currency Letters of Credit based on the then US Dollar
Equivalent, and the US Administrative Agent shall have exclusive dominion and
control (including the exclusive right of withdrawal) over such account;


 


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(iv)                              if the Issuing Banks make
any disbursement in connection with a Letter of Credit after the Revolving
Credit Maturity Date, such disbursement shall be an advance on behalf of the US
Borrowers under this Agreement and shall be reimbursed to the Issuing Banks
either (A) by the US Administrative Agent applying amounts in the cash
collateral account referred to in clause (iii) above until reimbursed in full,
or (B) by the US Borrowers pursuant to Section 2.10 (except that the US
Borrowers shall not have the right to request that the US Tranche Revolving
Lenders make, and the US Tranche Revolving Lenders shall not have any
obligation to make, a Loan under this Agreement after the Revolving Credit
Maturity Date to fund any such disbursement); and


 


(v)                                 all such disbursements
referred to in clause (iv) of this paragraph shall be secured only by the cash
collateral referred to in clause (iii) of this paragraph and the US Borrowers
herby grant, and by each deposit of such cash collateral with the US
Administrative Agent grant, to the US Administrative Agent a first-priority
security interest in all such cash collateral, without any further action on
the part of the Issuing Banks, the US Borrowers, the US Administrative Agent,
any US Tranche Revolving Lender or any other Person now or hereafter party
hereto (other than any action the US Administrative Agent reasonably deems
necessary to perfect such security interest, which action the US Borrowers
hereby authorize the US Administrative Agent to take), until same are
reimbursed in full.


 


If, on the later of the
Revolving Credit Maturity Date or the Term Loan Maturity Date (A) the US
Tranche Commitments have been terminated, (B) the Loans, all interest
thereon and all other amounts payable by the Borrowers hereunder or in
connection herewith (other than the LC Exposure in connection with any Letter
of Credit having an expiration date extending beyond the Revolving Credit
Maturity Date as permitted by Section 2.01(b)) have been paid in full,
and (C) the conditions set forth in clause (iii) above have been fully
satisfied, then from and after such date the following provisions of this
Agreement shall not be operative: Sections 9.01 (other than Section
9.01(a), which shall remain operative), 9.02 (except as the same may
affect a Letter of Credit), 9.03(b), 9.04, 9.09, 9.10,
9.11, 10.01, 10.02 (except for cash collateral securing
Letters of Credit), 10.03, 10.04, 10.06, 10.08, 10.11,
10.12, 10.13, 10.14, 10.15, 10.16, 10.17
and 10.18.


 


If, after payment in full
of all Indebtedness of the Borrowers under the Loan Documents (including
without limitation, reimbursement obligations with respect to Letters of
Credit) and the expiration or cancellation of all outstanding Letters of
Credit, there remains any amount on deposit in the cash collateral account
referred to in clause (iii) above, the US Administrative Agent shall, within
three (3) Business Days after all such Indebtedness is paid in full and all
outstanding Letters of Credit have expired or been cancelled, return such
amount to the US Borrowers.


 


(c)                                  Limitation on
Types of Loans.  Subject to the other
terms and provisions of this Agreement, at the option of the US Borrowers, the
US Tranche Loans may be US Dollar Base Rate Loans or US Dollar LIBOR Loans, and
at the option of the Canadian Borrower, the Canadian Tranche Loans may be
Canadian Prime Rate Loans, Bankers’ Acceptances, BA Equivalent Loans, US Dollar
Base Rate Loans or US Dollar LIBOR Loans; provided that, without the
prior written consent of the Majority Lenders, no more than ten (10) US Dollar
LIBO Rate Borrowings and five (5) Bankers’ Acceptances or BA Equivalent Loans
may be outstanding


 


32





















 


at any time with respect to the
Revolving Credit Facility.  Subject to
the other terms and provisions of this Agreement, at the option of the US Borrowers,
the Term Loans may be US Dollar Base Rate Loans or US Dollar LIBOR Loans; provided
that, without the prior written consent of the Majority Lenders, no more than
ten (10) US Dollar LIBO Rate Borrowings may be outstanding at any time with
respect to the Term Loan B Facility.


 


Section 2.02                                Borrowings,
Continuations and Conversions, Letters of Credit.


 


(a)                                  Borrowings.  The Borrowers shall give the US
Administrative Agent (which shall promptly notify the Lenders including the
Canadian Administrative Agent) advance notice as hereinafter provided of each
Borrowing hereunder, which shall specify (i) the aggregate amount of such
Borrowing, (ii) the Type (in each case stating the amounts and currency
requested), (iii) the date (which shall be a Business Day) of the Loans to
be borrowed, (iv) (in the case of US Dollar LIBOR Loans) the duration of
the Interest Period therefore and (v) the location and number of the Requesting
Borrower’s account.  Notwithstanding the
foregoing, all Borrowings by way of Bankers’ Acceptances and BA Equivalent
Loans shall be made pursuant to Section 2.12.


 


(b)                                 Minimum Amounts.  All US Dollar Base Rate Borrowings and
Canadian Prime Rate Borrowings shall be in amounts of at least $250,000 or with
respect to any Revolving Borrowing, the remaining balance of the Aggregate US
Tranche Commitments or the Canadian Allocated Total Commitments, as applicable,
if less, or the amount of a Borrowing to fund a Letter of Credit pursuant to Section 2.10(b),
if less, or any whole multiple of $250,000 in excess thereof, and all US Dollar
LIBO Rate Borrowings shall be in amounts of at least $1,000,000 or the amount
of a Borrowing to fund a Letter of Credit pursuant to Section 2.10(b),
if less, or any whole multiple of $500,000 in excess thereof.


 


(c)                                  Notices.  The initial Borrowing and all subsequent
Borrowings, continuations and conversions shall require advance written notice
to the US Administrative Agent (which shall promptly notify the Lenders
including the Canadian Administrative Agent) in the form of Exhibits B-1
and B-2, as applicable (or telephonic notice promptly confirmed by such
a written notice), which in each case shall be irrevocable, from the Requesting
Borrower to be received by the US Administrative Agent not later than (i)
12:00 p.m. Eastern time on the date of each US Dollar Base Rate Borrowing, (ii)
12:00 p.m. Eastern time one (1) Business Day prior to the date of each Canadian
Prime Rate Borrowing and (iii) three (3) Business Days prior to the date
of each US Dollar LIBO Rate Borrowing, continuation or conversion.  Without in any way limiting the Requesting
Borrower’s obligation to confirm in writing any telephonic notice, the
US Administrative Agent may act without liability upon the basis of
telephonic notice believed by the US Administrative Agent in good faith to
be from the Requesting Borrower prior to receipt of written confirmation.  In each such case, the Requesting Borrower
hereby waives the right to dispute the US Administrative Agent’s record of
the terms of such telephonic notice except in the case of gross negligence or
willful misconduct by the US Administrative Agent, its officers,
employees, agents or representatives. 
Either US Borrower may give notice for both US Borrowers.


 


(d)                                 Continuation
Options.  Subject to the provisions
made in this Section 2.02(d), the Borrowers may elect to continue
all or any part of any US Dollar LIBO Rate Borrowing beyond the expiration of
the then current Interest Period relating thereto by giving advance notice as


 


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provided in Section 2.02(c)
to the US Administrative Agent (which shall promptly notify the Lenders
including the Canadian Administrative Agent) of such election, specifying the
amount of such Borrowing to be continued and the Interest Period therefor.  In the absence of such a timely and proper
election, the Borrowers shall be deemed to have elected to convert such US
Dollar LIBO Rate Borrowing to a US Dollar Base Rate Borrowing, pursuant to Section 2.02(e).  All or any part of any US Dollar LIBO Rate
Borrowing may be continued as provided herein, provided that
(i) any continuation of any such Borrowing shall be (as to each Borrowing
as continued for an applicable Interest Period) in amounts of at least
$1,000,000 or any whole multiple of $500,000 in excess thereof and (ii) no
Default shall have occurred and be continuing. 
If a Default shall have occurred and be continuing, each US Dollar LIBO
Rate Borrowing shall be converted to a US Dollar Base Rate Borrowing on the
last day of the Interest Period applicable thereto.


 


(e)                                  Conversion Options.  The Borrowers may elect to convert all or any
part of any US Dollar LIBO Rate Borrowing on the last day of the then current
Interest Period relating thereto to (i) for the US Tranche, a US Dollar Base
Rate Borrowing and (ii) for the Canadian Tranche, a US Dollar Base Rate
Borrowing, a Canadian Prime Rate Borrowing or (subject to Section 2.12)
a Bankers’ Acceptance or BA Equivalent Borrowing by giving advance notice to
the US Administrative Agent (which shall promptly notify the Lenders including
the Canadian Administrative Agent) of such election.  Subject to the provisions made in this Section 2.02(e),
the Borrowers may elect to convert all or any part of any US Dollar Base Rate
Borrowing at any time and from time to time to (A) for the US Tranche, a US
Dollar LIBO Rate Borrowing and (B) for the Canadian Tranche, a US Dollar LIBO
Rate Borrowing, a Canadian Prime Rate Borrowing or (subject to Section 2.12)
a Bankers’ Acceptance or BA Equivalent Borrowing by giving advance notice as
provided in Section 2.02(c) to the US Administrative Agent (which
shall promptly notify the Lenders including the Canadian Administrative Agent)
of such election.  Subject to the
provisions made in this Section 2.02(e), the Canadian Borrower may
elect to convert all or any part of any Canadian Prime Rate Borrowing at any
time and from time to time to a US Dollar LIBO Rate Borrowing, a US Dollar Base
Rate Borrowing or (subject to Section 2.12) a Bankers’ Acceptance or BA
Equivalent Borrowing by giving advance notice as provided in Section 2.02(c)
to the US Administrative Agent (which shall promptly notify the Lenders
including the Canadian Administrative Agent) of such election.  All or any part of any outstanding Borrowing
may be converted as provided herein, provided that (x) any
conversion of any US Dollar Base Rate Borrowing into a US Dollar LIBO Rate
Borrowing shall be (as to each such Borrowing into which there is a conversion
for an applicable Interest Period) in amounts of at least $1,000,000 or any
whole multiple of $500,000 in excess thereof and (y) no Default shall have
occurred and be continuing.  If a Default
shall have occurred and be continuing, no US Dollar Base Rate Borrowing may be
converted into a US Dollar LIBO Rate Borrowing.


 


(f)                                    Advances.  Not later than 1:00 p.m. Eastern time on the
date specified for each Borrowing hereunder, each Applicable Lender shall make
available the amount of the Loan to be made by it on such date to the
Applicable Administrative Agent, to an account which such Administrative Agent
shall specify, in immediately available funds, for the account of the
Requesting Borrower.  The amounts so
received by the Applicable Administrative Agent shall, subject to the terms and
conditions of this Agreement, be made available to the Requesting Borrower by
depositing the same, in immediately available funds, in an account of the
Requesting Borrower, designated by such Borrower and maintained at its
principal office.


 


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(g)                                 Letters of Credit.  Any US Borrower shall submit to the US
Administrative Agent and the Issuing Bank a Letter of Credit Application not
later than 11:00 a.m. Eastern time, not less than three (3) Business Days
prior to the proposed date of issuance (or such shorter period as may be agreed
to by the US Administrative Agent and the Issuing Bank) and at least thirty
(30) Business Days prior to the date of amendment, renewal or extension
(or such shorter period as may be agreed to by the US Administrative Agent and
the Issuing Bank) of a Letter of Credit hereunder.  Each Letter of Credit Application shall
specify (i) the amount of such Letter of Credit, (ii) the date (which
shall be a Business Day) such Letter of Credit is to be issued, amended,
renewed or extended, (iii) the duration thereof, (iv) the name and
address of the beneficiary thereof, (v) the form of the Letter of Credit,
(vi) the name of the elected Issuing Bank and (vii) such other information
as the US Administrative Agent and the Issuing Bank may reasonably request, all
of which shall be reasonably satisfactory to the US Administrative Agent and
such Issuing Bank.  Subject to the terms
and conditions of this Agreement, on the date specified for the issuance,
amendment, renewal or extension of a Letter of Credit, the Issuing Bank shall
issue, amend, renew or extend such Letter of Credit to the beneficiary
thereof.  Promptly thereafter, the
Issuing Bank shall notify the US Administrative Agent and the applicable US
Borrower, in writing, of such issuance, amendment, renewal or extension, and
such notice shall be accompanied by a copy of such issuance, amendment, renewal
or extension.  Promptly after receipt of
such notice, the US Administrative Agent shall notify each US Tranche Revolving
Lender, in writing, of such issuance, amendment, renewal or extension and if
any US Tranche Revolving Lender so requests, the US Administrative Agent shall
provide such Lender with copies of such issuance, amendment, renewal or
extension.


 


Section 2.03                                Changes of
Commitments.


 


(a)                                  The US Borrowers
shall have the right to terminate or to reduce the amount of the Aggregate Term
Commitments at any time prior to the Term Loan Funding Date, upon not less than
three (3) Business Days’ prior notice to the US Administrative Agent of each
such termination or reduction, which notice shall specify the effective date
thereof and the amount of any such reduction (which shall not be less than
$1,000,000 or any whole multiple of $500,000 in excess thereof) and shall be
irrevocable and effective only upon receipt by the US Administrative Agent.


 


(b)                                 The US Borrowers shall
have the right to terminate or to reduce the amount of the Aggregate US Tranche
Commitments at any time, or from time to time, upon not less than three (3)
Business Days’ prior notice to the US Administrative Agent (which shall
promptly notify the Lenders including the Canadian Administrative Agent) of
each such termination or reduction, which notice shall specify the effective
date thereof and the amount of any such reduction (which shall not be less than
$1,000,000 or any whole multiple of $500,000 in excess thereof) and shall be
irrevocable and effective only upon receipt by the US Administrative Agent; provided
that, any termination in full of the Aggregate US Tranche Commitments pursuant
to Section 2.03(b) shall automatically terminate in full the Canadian
Allocated Maximum Total Commitments.


 


(c)                                  The US Borrowers
shall have the right to allocate (or reallocate, if previously allocated) a
portion of the Aggregate US Tranche Commitments as the Canadian Allocated Total
Commitments by notice to the US Administrative Agent; provided that (i)
any such notice shall be received by the US Administrative Agent not later than
11:00 a.m. Eastern time five (5) Business Days prior to the date such
allocation or reallocation shall become effective which


 


35





















 


effective date may only be at
the end of each fiscal quarter or prior to a Major Project, (ii) any such
allocation or reallocation shall be in an aggregate amount of $5,000,000 or any whole multiple in excess thereof,
not to exceed the Canadian Allocated Maximum Total Commitments, or shall be a
reallocation to zero, (iii) the US Borrowers shall not allocate or reallocate
any portion of the Aggregate US Tranche Commitments if, after giving effect
thereto and to any concurrent prepayments hereunder (A) the US Tranche Credit
Exposure would exceed the Aggregate US Tranche Commitments, (B) the Canadian
Tranche Credit Exposure would exceed the Canadian Allocated Total Commitments
and (C) any US Tranche Revolving Lender’s US Tranche Commitment would not equal
or exceed its US Tranche Credit Exposure or any Canadian Tranche Revolving
Lender’s Canadian Allocated Commitment would not equal or exceed its Canadian
Tranche Credit Exposure.  The allocation
will be effected by reducing the US Tranche Commitment of each US Tranche
Revolving Lender that is or has a branch or an Affiliate that is a Canadian
Tranche Revolving Lender by the amount that its or its branch’s or Affiliate’s
Canadian Allocated Commitment is increased. 
For any reallocation, its or its branch’s or Affiliate’s Canadian
Allocated Commitment will be reduced by the amount that its US Tranche
Commitment is increased.  Any US Tranche
Revolving Lender that is not or has no branch or Affiliate that is a Canadian
Tranche Revolving Lender will not have its US Tranche Commitment affected.  The US Administrative Agent will (x) promptly
notify the Canadian Administrative Agent and the US Tranche Revolving Lenders
and the Canadian Tranche Revolving Lenders of any such notice of allocation or
reallocation of the Aggregate US Tranche Commitments and the amount of their
respective Canadian Allocated Commitments, (y) prepare and provide to the
Borrowers, the Canadian Administrative Agent and the other Lenders a new Annex
I giving effect to such allocation or reallocation and (z) notify all
Lenders of the Aggregate US Tranche Commitments and Canadian Allocated Total
Commitments upon the effectiveness of such allocation or reallocation, which
effectiveness shall require no vote or consent of any Lender.


 


(d)                                 At any time during
which no Canadian Allocation Period exists, the US Borrowers may at such time
permanently terminate their right to allocate a portion of the Aggregate US
Tranche Commitments as the Canadian Allocated Total Commitments, at which time
the obligations of the Canadian Borrower hereunder and each Guaranty pursuant
to ARTICLE XIV shall automatically terminate, and thereafter no US
Tranche Revolving Lender nor any Canadian Tranche Revolving Lender shall have
any Canadian Allocated Commitment.


 


(e)                                  The Aggregate Term
Commitments and the Aggregate US Tranche Commitments once terminated or reduced
pursuant to Sections 2.03(a) and (b), respectively may not be
reinstated.


 


Section 2.04                                Fees.


 


(a)                                  Commitment Fee.


 


(i)                                     The US Borrowers
shall pay to the US Administrative Agent for the account of each US Tranche
Revolving Lender a commitment fee, which shall accrue at the Applicable Margin
(a “US Commitment Fee”), on the daily average unused amount (after
deducting any LC Exposure) of each US Tranche Revolving Lender’s US Tranche
Commitment for the period from and including the Closing Date up to, but
excluding, the Revolving Credit Maturity Date.


 


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(ii)                                  During a Canadian
Allocation Period, in consideration of each Canadian Tranche Revolving Lender’s
Canadian Allocated Commitment, the Canadian Borrower shall pay to the US
Administrative Agent in US Dollars for the account of each Canadian Tranche
Revolving Lender a commitment fee, which shall accrue at the Applicable Margin
(a “Canadian Commitment Fee”), on the daily average unused amount of
each Canadian Tranche Revolving Lender’s Canadian Allocated Commitment for the
Canadian Allocation Period.


 


(iii)                               Accrued Commitment Fees
shall be payable quarterly in arrears on each Quarterly Date and on the earlier
of the date the Aggregate Revolving Commitments are terminated or the Revolving
Credit Maturity Date.


 


(b)                                 Letter of Credit
Fees.


 


(i)                                     The US Borrowers
shall pay to the US Administrative Agent, for the account of each US Tranche
Revolving Lender and the Issuing Banks, commissions for issuing the Letters of
Credit on the daily outstanding amount of the maximum liability of the Issuing
Banks existing from time under such Letter of Credit (including the US Dollar
Equivalent of the face amount of the outstanding Offshore Currency Letter of
Credit) (calculated separately for each Letter of Credit) at a rate equal to
the Applicable Margin for US Dollar LIBOR Loans under the Revolving Credit
Facility, in effect from time to time during the term of each Letter of
Credit.  Each Letter of Credit shall be
deemed outstanding up to the available face amount of the Letter of Credit
(including the US Dollar Equivalent of the face amount of the outstanding
Offshore Currency Letter of Credit) until the Issuing Banks have received from
the beneficiary a written cancellation authorization, in form and substance
reasonably acceptable to the Issuing Banks or until the date the Letter of
Credit expires by its terms.  Such
commissions are payable quarterly in arrears on each Quarterly Date and upon
cancellation or expiration of each such Letter of Credit.


 


(ii)                                  Out of the fees
described in Section 2.04(b)(i), the US Administrative Agent shall
pay to the Issuing Bank, for such Issuing Bank’s account, 0.125% per annum of
each such fee as an issuing fee and shall pay to the US Tranche Revolving
Lenders a pro rata share of the remaining portion of such fees.


 


(iii)                               The US Borrowers shall
pay to the Issuing Bank for its own account, upon each drawing or payment
under, issuance of, or amendment to, any Letter of Credit, such amount as shall
at the time of such event be the administrative charge and reasonable
out-of-pocket expenses which the Issuing Bank or its Affiliate is generally
imposing in connection with such occurrence with respect to letters of credit.


 


(c)                                  Ticking Fees.  The US Borrowers shall pay to the US
Administrative Agent for the account of each Term Loan Lender a ticking fee
which shall accrue at 0.35% on the daily average amount of such Term Loan
Lender’s Term Commitment for the period from and including the Closing Date up
to the Term Loan Funding Date.  Ticking
fees shall be payable on the Term Loan Funding Date.


 


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(d)                                 Other Fees.  The US Borrowers shall pay to the US
Administrative Agent for its own account such other fees as are set forth in
the Fee Letter on the dates specified therein to the extent not paid prior to
the Closing Date.


 


Section 2.05                                Several Obligations.  The failure of any Lender to make any Loan to
be made by it or to provide funds for disbursements or reimbursements under
Letters of Credit on the date specified therefor shall not relieve any other
Lender of its obligation to make its Loan or provide funds on such date, but no
Lender shall be responsible for the failure of any other Lender to make a Loan
to be made by such other Lender or to provide funds to be provided by such
other Lender.


 


Section 2.06                                Notes.  Any Lender may request that the Loans made by
it be evidenced by a promissory note.  In
such event, the Applicable Borrower shall prepare, execute and deliver to such
Lender a promissory note payable to the order of such Lender, substantially in
the form of Exhibit A-1, with respect to Revolving Loans made to
the US Borrowers, Exhibit A-2 with respect to Revolving Loans made to
the Canadian Borrower and Exhibit A-3 with respect to Term Loans, as
applicable, dated (a) the Closing Date or (b) the effective date of
an Assignment pursuant to Section 13.06(b), in a principal amount
equal to its Percentage Share of the Aggregate US Tranche Commitments, Canadian
Allocated Maximum Total Commitments or Aggregate Term Commitments as the case
may be, as originally in effect and otherwise duly completed and such
substitute Notes as required by Section 13.06(b); provided
that promissory notes requested in amounts less than $1,000,000 shall require
the consent of the Applicable Borrower, such consent not to be unreasonably
withheld or delayed.  The date, amount,
Type, interest rate and Interest Period of each Loan made by each Lender, and
all payments made on account of the principal thereof, shall be recorded by
such Lender on its books and maintained in accordance with its usual
practice.  Failure to make such
recordation shall not affect any Lender’s or any Borrower’s rights or
obligations in respect of such Loans.


 


Section 2.07                                Prepayments.


 


(a)                                  Voluntary
Prepayments.  The Borrowers may
prepay the US Dollar Base Rate Loans and the Canadian Borrower may prepay the
Canadian Prime Rate Loans, as applicable, upon the same Business Day’s prior
notice to the US Administrative Agent (which shall promptly notify the Lenders,
including the Canadian Administrative Agent), which notice shall specify the
prepayment date (which shall be a Business Day) and the amount of the
prepayment (which shall be at least $1,000,000 or the remaining aggregate
principal balance outstanding on the applicable Notes) and shall be irrevocable
and effective only upon receipt by the US Administrative Agent, provided
that interest on the principal prepaid, accrued to the prepayment date, shall
be paid on the prepayment date.  The
Borrowers may prepay US Dollar LIBOR Loans on the same conditions as for US
Dollar Base Rate Loans (except that prior notice to the US Administrative
Agent shall not be less than three (3) Business Days for US Dollar LIBOR
Loans) and in addition such prepayments of US Dollar LIBOR Loans shall be
subject to the terms of Section 5.05 and shall be in an amount
equal to all of the US Dollar LIBOR Loans for the Interest Period prepaid.  Any prepayments made to the Term Loans shall
be applied inversely to the remaining installments owed pursuant to Section
3.01(b).  Notwithstanding the
foregoing, the Canadian Borrower shall not be permitted to prepay any Bankers’
Acceptances or BA Equivalent Loans at any time.


 


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(b)                                 Mandatory
Prepayments.


 


(i)                                     If, after giving
effect to any termination, reduction or allocation of the Aggregate US Tranche
Commitments pursuant to Sections 2.03(b) and (c), (A) the US
Tranche Credit Exposure exceeds the Aggregate US Tranche Commitments or (B) any
US Tranche Revolving Lender’s US Tranche Credit Exposure exceeds its US Tranche
Commitment, (1) the US Borrowers shall prepay the US Tranche Loans on the date
of such termination, reduction or allocation in an aggregate principal amount,
together with interest on the principal amount paid accrued to the date of such
prepayment, equal to the excess to be applied first to clause (A) above and
then any remaining to clause (B) above for the applicable US Tranche Revolving
Lender and (2) if any excess remains after prepaying all of the US Tranche
Loans because of the LC Exposure, the US Borrowers shall pay to the US
Administrative Agent on behalf of the Issuing Bank and the US Tranche Revolving
Lenders an amount equal to the excess to be held as cash collateral as provided
in Section 2.10(b) hereof.


 


(ii)                                  If, after giving
effect to any reallocation of the Canadian Allocated Commitment pursuant to Section 2.03(c)
or any termination or reduction pursuant to Section 2.03(b), (A) the
outstanding aggregate principal amount of the Canadian Tranche Credit Exposure
exceeds the Canadian Allocated Total Commitments or (B) any Canadian Tranche
Revolving Lender’s Canadian Tranche Credit Exposure exceeds its Canadian
Allocated Commitment, the Canadian Borrower shall prepay the Canadian Tranche
Loans (other than Bankers’ Acceptances and BA Equivalent Loans) on the date of
such reallocation in an aggregate principal amount, together with interest on
the principal amount paid accrued to the date of such prepayment equal to the
excess to be applied first to clause (A) above and then any remaining to clause
(B) above for the applicable Canadian Tranche Revolving Lender.


 


(iii)                               Upon the incurrence or
issuance by any Subsidiary of Holdings of any increase in the amount of Debt
permitted by Section 10.01(e) in excess of $200,000,000 outstanding, and
any subsequent increases over the previous highest amount outstanding permitted
under Section 10.01(e), the US Borrowers shall prepay an amount equal to
75% of all Net Proceeds received from each such increase within ten (10)
Business Days after receipt thereof by Holdings or such Subsidiary.  Each prepayment of Loans pursuant to this Section
2.07(b)(iii) shall be applied pursuant to Section 2.07(b)(vi).


 


(iv)                              Upon the Disposition of
any Property by Holdings or any of its Domestic Subsidiaries which in the
aggregate results in the realization by Holdings or such Domestic Subsidiary of
Net Proceeds (determined as of the date of such Disposition, whether or not
such Net Proceeds are then received by Holdings or such Domestic Subsidiary and
which Net Proceeds are not reinvested in the business of Holdings or its
Domestic Subsidiaries within 180 days from the time of such Disposition), the
US Borrowers shall prepay an amount equal to 100% of all Net Proceeds received
therefrom and not reinvested within five (5) Business Days after such 180 day
period.  Each prepayment of Loans
pursuant to this Section 2.07(b)(iv) shall be applied pursuant to Section
2.07(b)(vi).


 


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(v)                                 Upon the receipt by
Holdings or any of its Domestic Subsidiaries of an Extraordinary Receipt and
not otherwise included in clause (iii) or (iv) of this Section, which in the
aggregate results in the realization by Holdings or such Domestic Subsidiary of
Net Proceeds and such Net Proceeds are not subject to a plan of reinvestment in
the business of Holdings or its Domestic Subsidiaries within 180 days from the
time of such receipt, Holdings shall prepay an amount equal to 100% of all Net
Proceeds received therefrom and not reinvested within fifteen (15) Business
Days after such 180 day period.  Each
prepayment of Loans pursuant to this Section 2.07(b)(v) shall be applied
pursuant to Section 2.07(b)(vi).


 


(vi)                              With respect to
subsections (iii), (iv) and (v) above, if no Event of Default exists and is
continuing, the US Borrowers shall first prepay the Term Loans in an aggregate
principal amount, together with interest on the principal amount paid accrued
to the date of such prepayment, equal to the Net Proceeds required to be
prepaid pursuant to such subsections which shall be applied inversely to the
remaining installments owed pursuant to Section 3.01(b), and if any excess remains after prepaying
all of the Term Loans, the Borrowers shall apply the remaining Net Proceeds to
(A) prepay the US Tranche Loans, together with interest on the principal amount
paid accrued to the date of such prepayment and/or (B) the Canadian Borrower
shall prepay the Canadian Tranche Loans (other than Bankers’ Acceptances and BA
Equivalent Loans), together with interest on the principal amount paid accrued
to the date of such prepayment, and (C) if any excess remains after
prepaying all of the Term Loans and the Revolving Loans because of the LC
Exposure, the US Borrowers shall pay to the US Administrative Agent on behalf
of the US Tranche Revolving Lenders an amount equal to the excess to be held as
cash collateral as provided in Section 2.10(b) hereof.


 


(c)                                  Generally.  Prepayments permitted or required under this Section 2.07
shall be without premium or penalty, except as required under Section 5.05
for prepayment of US Dollar LIBOR Loans. 
Any prepayments on the Revolving Loans may be reborrowed subject to the
then effective Aggregate US Tranche Commitments and the Canadian Allocated
Total Commitments, as applicable.  Any
prepayments on the Term Loans may not be reborrowed.  Notwithstanding Section 2.07(b), any
prepayments made if an Event of Default exists and is continuing shall be
applied pari passu to the
Aggregate Credit Exposure.  In the event
of a mandatory prepayment pursuant to this Section 2.07 which would
cause Bankers’ Acceptances and BA Equivalent Notes to be prepaid but for the
prohibition on prepayment contained herein, the US Administrative Agent shall
deposit with the Canadian Administrative Agent an amount equal to the Principal
Amount that would have been prepaid for such Bankers’ Acceptances and BA
Equivalent Notes on behalf of the Canadian Revolving Lenders holding such Bankers’
Acceptances and BA Equivalent Notes to be held pursuant to the terms in Section
2.12(i) except that on the BA Maturity Date for such Bankers’ Acceptances
and BA Equivalent Notes, the Canadian Administrative Agent shall apply such
amounts against such Bankers’ Acceptances and BA Equivalent Notes.


 


Section 2.08                                Reserved.


 


Section 2.09                                Assumption of Risks.  Each US Borrower assumes all risks of the
acts or omissions of any beneficiary of any Letter of Credit or any transferee
thereof with respect to its use of such Letter of Credit.  Neither the Issuing Bank (except in the case
of gross negligence


 


40





















 


or willful misconduct on the
part of the Issuing Bank or any of its officers, employees, agents or representatives
as determined by final and non appealable judgment of a court of competent
jurisdiction), its correspondents nor any Lender shall be responsible for the
validity, sufficiency or genuineness of certificates or other documents or any
endorsements thereon, even if such certificates or other documents should in
fact prove to be invalid, insufficient, fraudulent or forged; for errors,
omissions, interruptions or delays in transmissions or delivery of any messages
by mail, telex, or otherwise, whether or not they be in code; for errors in
translation or for errors in interpretation of technical terms; the validity or
sufficiency of any instrument transferring or assigning or purporting to
transfer or assign any 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; the failure of any beneficiary or any transferee of
any Letter of Credit to comply fully with conditions required in order to draw
upon any Letter of Credit; or for any other consequences arising from causes
beyond the Issuing Bank’s control or the control of the Issuing Bank’s
correspondents.  In addition, neither the
Issuing Bank, the US Administrative Agent nor any Lender shall be
responsible for any error, neglect, or default of any of the Issuing Bank’s
correspondents; and none of the above shall affect, impair or prevent the
vesting of any of the Issuing Bank’s, the US Administrative Agent’s or any
Lender’s rights or powers hereunder, all of which rights shall be
cumulative.  The Issuing Bank and its
correspondents may accept certificates or other documents that appear on their
face to be in order, without responsibility for further investigation of any
matter contained therein regardless of any notice or information to the
contrary.  In furtherance and not in
limitation of the foregoing provisions, each US Borrower agrees that any
action, inaction or omission taken or not taken by the Issuing Bank or by any
correspondent for the Issuing Bank in good faith in connection with any Letter
of Credit, or any related drafts, certificates, documents or instruments, shall
be binding on the Borrowers and shall not put the Issuing Bank or its
correspondents under any resulting liability to the Borrowers.


 


Section 2.10                                Obligation to
Reimburse and to Prepay.


 


(a)                                  In
connection with any Letter of Credit, the US Borrowers may make funds available
for disbursement by the Issuing Bank in connection with such Letter of
Credit.  In such cases, the Issuing Bank
shall use such funds which the US Borrowers have made available to fund such
Letter of Credit.  In addition, the US
Borrowers may give written instructions to the Issuing Bank and the US
Administrative Agent to make a Loan under this Agreement to fund any Letters of
Credit which may be drawn.  In all such
cases, the US Borrowers shall give the appropriate notices required under this
Agreement for a US Dollar Base Rate Loan or a US Dollar LIBOR Loan.  If a disbursement by the Issuing Bank is made
under any Letter of Credit, in cases in which the US Borrowers have not either
provided their own funds to fund a draw on a Letter of Credit or given the US
Administrative Agent prior notice for a Loan under this Agreement, then the US
Borrowers shall pay to the US Administrative Agent within two (2) Business
Days after notice of any such disbursement is received by the US Borrowers, the
amount and, in the case of any Offshore Currency Letters of Credit, the US
Dollar Equivalent determined on the date of such disbursement, of each such
disbursement made by the Issuing Bank under the Letter of Credit (if such
payment is not sooner effected as may be required under this Section 2.10
or under other provisions of the Letter of Credit), together with interest on
the amount disbursed from and including the date of disbursement until payment
in full of such disbursed amount at a varying rate per annum equal to
(i) the then applicable interest rate for US


 


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Dollar Base Rate Loans through
the second Business Day after notice of such disbursement is received by such
US Borrower and (ii) thereafter, the Post-Default Rate for US Dollar Base
Rate Loans (but in no event to exceed the Highest Lawful Rate) for the period
from and including the third Business Day following the date of such
disbursement to and including the date of repayment in full of such disbursed
amount.  The obligations of each US
Borrower under this Agreement with respect to each Letter of Credit shall be
absolute, unconditional and irrevocable and shall be paid or performed strictly
in accordance with the terms of this Agreement under all circumstances
whatsoever, including, without limitation, but only to the fullest extent
permitted by applicable law, the following circumstances:  (A) any lack of validity or
enforceability of this Agreement, any Letter of Credit or any of the Security
Instruments; (B) any amendment or waiver of (including any default), or
any consent to departure from this Agreement (except to the extent permitted by
any amendment or waiver), any Letter of Credit or any of the Security
Instruments; (C) the existence of any claim, set-off, defense or other
rights which either US Borrower may have at any time against the beneficiary of
any Letter of Credit or any transferee of any Letter of Credit (or any Persons
for whom any such beneficiary or any such transferee may be acting), the
Issuing Bank, the US Administrative Agent, any US Tranche Revolving Lender or
any other Person, whether in connection with this Agreement, any Letter of
Credit, the Security Instruments, the transactions contemplated hereby or any
unrelated transaction; (D) any statement, certificate, draft, notice or
any other document presented under any Letter of Credit proves to have been
forged, fraudulent, insufficient or invalid in any respect or any statement
therein proves to have been untrue or inaccurate in any respect whatsoever;
(E) payment by the Issuing Bank under any Letter of Credit against
presentation of a draft or certificate which appears on its face to comply, but
does not comply, with the terms of such Letter of Credit; and (F) any
other circumstance or happening whatsoever, whether or not similar to any of
the foregoing.


 


Notwithstanding anything in
this Agreement to the contrary, the US Borrowers will not be liable for payment
or performance that results from the gross negligence or willful misconduct of
the Issuing Bank or its officers, employees, agents or representatives,
except where the US Borrowers or any Subsidiary actually recovers the
proceeds for itself or the Issuing Bank of any payment made by the Issuing Bank
in connection with such gross negligence or willful misconduct, except for
reasonable costs and expenses associated with such recovery.


 


(b)                                 In
the event of the occurrence of any Event of Default, a payment or prepayment
pursuant to Section 2.07(b) or the maturity of the Notes, whether
by acceleration or otherwise, an amount equal to the LC Exposure, except for
all Offshore Currency Letters of Credit which shall equal an amount equal to
110% of the aggregate face amount of all such Offshore Currency Letters of
Credit based on the then US Dollar Equivalent, shall be deemed to be forthwith
due and owing by the US Borrowers to the Issuing Bank, the US Administrative
Agent and the US Tranche Revolving Lenders as of the date of any such
occurrence; and each US Borrower’s obligation to pay such amount shall be
absolute and unconditional, without regard to whether any beneficiary of any
such Letter of Credit has attempted to draw down all or a portion of such
amount under the terms of a Letter of Credit, and, to the fullest extent
permitted by applicable law, shall not be subject to any defense or be affected
by a right of set-off, counterclaim or recoupment which the US Borrowers may
now or hereafter have against any such beneficiary, the Issuing Bank, the US
Administrative Agent, the US Tranche Revolving Lenders or any other Person for
any reason whatsoever.  The US Borrowers
will have a continuing obligation to


 


42





















 


maintain in such account at
least an amount in cash equal to 110% of the aggregate face amount of all such
Offshore Currency Letters of Credit based on the then US Dollar
Equivalent.  Such payments shall be held
by the Issuing Bank on behalf of the US Tranche Revolving Lenders as cash
collateral securing the LC Exposure in an account or accounts at the Principal
Office; and the US Borrowers hereby grant to, and by their deposit with the US
Administrative Agent grants to, the US Administrative Agent a security interest
in such cash collateral.  In the event of
any such payment by the US Borrowers of amounts contingently owing under
outstanding Letters of Credit and in the event that thereafter drafts or other
demands for payment complying with the terms of such Letters of Credit are not
made prior to the respective expiration dates thereof, the US Administrative
Agent agrees, if no Event of Default has occurred and is continuing or if no
other amounts are outstanding under this Agreement, the Notes or the Security
Instruments, to remit to the US Borrowers (i) amounts for which the
contingent obligations evidenced by the Letters of Credit have ceased and
(ii) amounts on deposit as cash collateral for Letters of Credit.


 


(c)                                  Each
US Tranche Revolving Lender severally and unconditionally agrees that it shall
promptly reimburse the Issuing Bank in US Dollars an amount equal to such
Lender’s participation in any Letter of Credit as provided in Section
2.01(b) of any disbursement made by the Issuing Bank under any Letter of
Credit that is not reimbursed according to this Section 2.10 and
such obligation to reimburse is absolute and unconditional and shall not be
affected by any circumstance whatsoever, including any amendment, renewal or
extension of any Letter of Credit or the occurrence and continuance of a
Default or reduction or termination of the Aggregate Revolving Commitments, and
that each such payment shall be made without any offset, abatement, withholding
or reduction whatsoever.  If the US
Borrowers fail to make such payment when due, the US Administrative Agent shall
notify each US Tranche Revolving Lender of the applicable disbursement, the
payment then due from the US Borrowers in respect thereof and such Lender’s
applicable percentage thereof.  Promptly
following receipt of such notice, each US Tranche Revolving Lender shall pay to
the US Administrative Agent its applicable percentage of the payment then due
from the US Borrowers, in the same manner as provided in Section 2.02(f)
with respect to Loans made by such Lender (and Section 2.02(f) shall
apply, mutatis mutandis, to the
payment obligations of the US Tranche Revolving Lenders), and the US
Administrative Agent shall promptly pay to the Issuing Bank the amounts so
received by it from the US Tranche Revolving Lenders.  Promptly following receipt by the US
Administrative Agent of any payment from the US Borrowers pursuant to this
paragraph, the US Administrative Agent shall distribute such payment to the
Issuing Bank or, to the extent that US Tranche Revolving Lenders have made
payments pursuant to this paragraph to reimburse the Issuing Bank, then to such
US Tranche Revolving Lenders and the Issuing Bank as their interests may
appear.  Any payment made by a Lender
pursuant to this paragraph to reimburse the Issuing Bank for any disbursement
shall constitute a Loan and shall not relieve the US Borrowers of their
obligation to reimburse such disbursement.


 


(d)                                 Notwithstanding
anything to the contrary contained herein, if no Event of Default has occurred
and is continuing, and subject to availability under the Aggregate Revolving
Commitments (after reduction for the LC Exposure), to the extent the US
Borrowers have not reimbursed the Issuing Bank for any drawn upon Letter of
Credit within one (1) Business Day after notice of such disbursement has
been received by the US Borrowers, the amount of such Letter of Credit
reimbursement obligation shall automatically be funded by the US Tranche
Revolving Lenders as a Loan hereunder and used by such Lenders to pay such
Letter of Credit


 


43





















 


reimbursement obligation in the
percentages referenced in clause (c) above. 
If an Event of Default has occurred and is continuing, or if the funding
of such Letter of Credit reimbursement obligation as a Loan would cause the
aggregate amount of all Loans outstanding to exceed the Aggregate Revolving
Commitments (after reduction for the LC Exposure), such Letter of Credit
reimbursement obligation shall not be funded as a Loan, but instead shall
accrue interest as provided in Section 2.10(a).


 


Section 2.11                                Lending Offices.  The Loans of each Type made by each Lender
shall be made and maintained at such Lender’s Applicable Lending Office for
Loans of such Type.


 


Section 2.12                                Bankers’ Acceptances
and BA Equivalent Loans.


 


(a)                                  Subject
to the terms and conditions of this Agreement, the Canadian Allocated
Commitments may be utilized, upon the request of the Canadian Borrower, in
addition to Canadian Prime Rate Loans, US Dollar Base Rate Loans and US Dollar
LIBOR Loans provided for by Section 2.01(a)(iii), for the acceptance and
purchase by the Canadian Tranche Revolving Lenders of Bankers’ Acceptances
issued by the Canadian Borrower or the making of BA Equivalent Loans, provided
that (i) in no event shall the US Dollar Equivalent Amount of the aggregate
amount of the Canadian Prime Rate Loans, Bankers’ Acceptances and BA Equivalent
Loans and the aggregate amount of the US Dollar Base Rate Loans and the US
Dollar LIBOR Loans owing to the Canadian Tranche Revolving Lenders exceed the
Canadian Allocated Total Commitments, (ii) all Bankers’ Acceptances and BA
Equivalent Notes shall have maturities which fall on a Business Day and are an
integral multiple of thirty (30) days, and are not less than thirty (30) days
or more than 180 days, from the Acceptance Date (and shall in no event mature
on a date after the Revolving Credit Maturity Date) and (iii) in no event shall
the face amount of any Borrowing by way of Bankers’ Acceptance or BA Equivalent
Loan be less than C$1,000,000 and other than in multiples of C$100,000 for any
amounts in excess thereof.  Whenever the
Canadian Borrower is required to furnish a notice to the Canadian Administrative
Agent pursuant to the following additional provisions of this Section 2.12,
it shall give a copy of such notice to the US Administrative Agent.


 


(b)                                 To
facilitate the acceptance of Bankers’ Acceptances and the issuance of BA
Equivalent Notes under this Agreement, the Canadian Borrower shall, from time
to time as required, provide to the Canadian Administrative Agent Drafts and BA
Equivalent Notes duly executed and endorsed in blank by the Canadian Borrower
in quantities sufficient for each Canadian Tranche Revolving Lender to fulfill
its obligations hereunder.  In addition,
the Canadian Borrower hereby appoints each Canadian Tranche Revolving Lender as
its attorney, with respect to Drafts and BA Equivalent Notes for which the Canadian
Borrower has provided a Bankers’ Acceptance or BA Equivalent Loan notice:


 


(i)                                     to
complete and sign on behalf of the Canadian Borrower, either manually or by
facsimile or mechanical signature, the Drafts to create the Bankers’
Acceptances (with, in each Canadian Tranche Revolving Lender’s discretion, the
inscription “This is a depository bill subject to the Depository Bills and
Notes Act (Canada)”) or the BA Equivalent Notes, as applicable;


 


(ii)                                  after
the acceptance thereof by any Canadian Tranche Revolving Lender, to endorse on
behalf of the Canadian Borrower, either manually or by facsimile or


 


44





















 


mechanical
signature, such Bankers’ Acceptance in favor of the applicable purchaser or
endorsee thereof including, in such Canadian Tranche Revolving Lender’s
discretion, such Canadian Tranche Revolving Lender or a clearing house (as
defined by the DBNA);


 


(iii)                               to
deliver such Bankers’ Acceptances to such purchaser or to deposit such Bankers’
Acceptances with such clearing house; and


 


(iv)                              to comply
with the procedures and requirements established from time to time by such
Canadian Tranche Revolving Lender or such clearing house in respect of the
delivery, transfer and collection of Drafts and Bankers’ Acceptances.


 


The Canadian Borrower
recognizes and agrees that all Drafts, Bankers’ Acceptances and BA Equivalent
Notes signed, endorsed, delivered or deposited on its behalf by a Canadian
Tranche Revolving Lender shall bind the Canadian Borrower as fully and
effectually as if signed in the handwriting of and duly issued, delivered or
deposited by the proper signing officer of the Canadian Borrower.  Each Canadian Tranche Revolving Lender is
hereby authorized to accept such Drafts or issue such Bankers’ Acceptances
endorsed in blank or issue BA Equivalent Notes in such face amounts as may be
determined by such Canadian Tranche Revolving Lender in accordance with the
terms of this Agreement, provided that the aggregate amount thereof is less
than or equal to the aggregate amount of Bankers’ Acceptances required to be
accepted by or BA Equivalent Loans made by such Canadian Tranche Revolving
Lender.  No Canadian Tranche Revolving
Lender shall be responsible or liable for its failure to accept a Bankers’
Acceptance or make a BA Equivalent Loan if the cause of such failure is, in
whole or in part, due to the failure of the Canadian Borrower to provide duly
executed and endorsed Drafts or BA Equivalent Notes to the Canadian
Administrative Agent on a timely basis, nor shall any Canadian Tranche
Revolving Lender be liable for any damage, loss or other claim arising by
reason of any loss or improper use of any such instrument except loss or
improper use arising by reason of the gross negligence or willful misconduct of
such Canadian Tranche Revolving Lender, its officers, employees, agents or
representatives. The Canadian Administrative Agent and each Canadian Tranche
Revolving Lender shall exercise such care in the custody and safekeeping of
Drafts and BA Equivalent Notes as it would exercise in the custody and
safekeeping of similar property owned by it. Each Canadian Tranche Revolving
Lender will, upon the request of the Canadian Borrower, promptly advise the
Canadian Borrower of the number and designation, if any, of Drafts and BA
Equivalent Notes then held by it for the Canadian Borrower. Each Canadian
Tranche Revolving Lender shall maintain a record with respect to Drafts and
Bankers’ Acceptances (A) received by it from the Canadian Administrative Agent
in blank hereunder, (B) voided by it for any reason, (C) accepted by it
hereunder, (D) purchased by it hereunder and (E) canceled at their
respective maturities and of BA Equivalent Notes (1) received by it from the
Canadian Administrative Agent in blank hereunder, (2) voided by it for any
reason and (3) canceled at their respective maturities. Each Canadian Tranche
Revolving Lender further agrees to retain such records in the manner and for
the statutory periods provided in the various Canadian provincial or federal
statutes and regulations which apply to such Canadian Tranche Revolving Lender.


 


(c)                                  When
the Canadian Borrower wishes to make a Borrowing by way of Bankers’ Acceptances
or BA Equivalent Loans, the Canadian Borrower shall give the Administrative
Agents a borrowing notice in the form of Exhibit B-2 with respect to the
issuance of the Bankers’ Acceptances or BA Equivalent Notes by not later than
1:00 p.m. Eastern time, three (3)


 


45





















 


Business Days’ prior to the
Acceptance Date.  Each borrowing notice
shall be irrevocable and binding on the Canadian Borrower.  The Canadian Borrower shall indemnify each
Canadian Tranche Revolving Lender against any loss or expense incurred by such
Lender as a result of any failure by the Canadian Borrower to fulfill or honor
before the date specified as the Acceptance Date, the applicable conditions set
forth in ARTICLE VI, if, as a result of such failure the requested
Bankers’ Acceptance or a BA Equivalent Loan is not made on such date.  Unless otherwise agreed among the Administrative
Agents and the Canadian Tranche Revolving Lenders, the aggregate amount of all
Bankers’ Acceptances or BA Equivalent Notes issued on any Acceptance Date
hereunder shall be accepted pro rata, subject to Section 2.12(g), by all
Canadian Tranche Revolving Lenders relative to their respective Canadian
Tranche Percentage.  Upon receipt of a
borrowing notice, the Canadian Administrative Agent shall advise each Canadian
Tranche Revolving Lender of the contents thereof.  Upon the acceptance of a Bankers’ Acceptance
or a BA Equivalent Note by a Canadian Tranche Revolving Lender, such Lender
shall purchase such Bankers’ Acceptance from or make such BA Equivalent Loan to
the Canadian Borrower and pay to the Canadian Administrative Agent not later
than 12:00 p.m. Eastern time, on the day of such Borrowing, for the account of
the Canadian Borrower, the amount of the BA Net Proceeds in respect of such
Bankers’ Acceptance or BA Equivalent Loan.


 


(d)                                 On
each day during the period commencing with the issuance by the Canadian
Borrower of any Bankers’ Acceptance and until such BA Exposure shall have been
paid by the Canadian Borrower, the Canadian Allocated Commitment of each
Accepting Lender that is able to extend credit by way of Bankers’ Acceptances
shall be deemed to be utilized for all purposes of this Agreement in an amount
equal to the Principal Amount of such Bankers’ Acceptance.  The Canadian Allocated Commitment of any
Canadian Tranche Revolving Lender providing a BA Equivalent Loan rather than
Bankers’ Acceptances shall be deemed utilized during this period in an amount
equal to its Canadian Tranche Percentage of the total amount of Bankers’
Acceptances and BA Equivalent Loans in each borrowing notice.


 


(e)                                  The
Canadian Borrower agrees to pay on the BA Maturity Date for each Bankers’
Acceptance and BA Equivalent Note, to the Canadian Administrative Agent for
account of each Accepting Lender, an amount equal to the Principal Amount of
such Bankers’ Acceptance or BA Equivalent Note. 
The Canadian Borrower hereby waives presentment for payment of Bankers’
Acceptances or BA Equivalent Note by each Accepting Lender and any defense to
payment of amounts due to an Accepting Lender in respect of a Bankers’
Acceptance or BA Equivalent Note which might exist by reason of such Bankers’
Acceptance or BA Equivalent Note being held at maturity by the Accepting Lender
which accepted it and agree not to claim from such Lender any days of grace for
the payment at maturity of Bankers’ Acceptances or BA Equivalent Notes.


 


(f)                                    If
the Canadian Borrower fails to notify the Canadian Administrative Agent in
writing not later than 1:00 p.m. Eastern time, on the Business Day prior to any
BA Maturity Date that the Canadian Borrower intends to pay the Bankers’
Acceptances and BA Equivalent Loans due on such BA Maturity Date, or fails to
make such payment, the Canadian Borrower shall be deemed, for all purposes to
have given the Canadian Administrative Agent notice
of a borrowing of a Canadian Prime Rate Loan pursuant to Section 2.02(a)
for an amount equal to the Principal Amount of such Bankers’ Acceptance and BA
Equivalent Loan; provided that:


 


(i)                                     the
BA Maturity Date for such Bankers’ Acceptances shall be considered to be the
date of such Borrowing;


 


46





















(ii)                                  the
proceeds of such Canadian Prime Rate Loan shall be used to pay the Principal
Amount of the Bankers’ Acceptance due on such BA Maturity Date;


 


(iii)                               each
Canadian Tranche Revolving Lender which has made a maturing BA Equivalent Loan
(in accordance with Section 2.12(g) hereof) shall continue to extend
credit to the Canadian Borrower (without further advance of funds to the
Canadian Borrower) by way of a Canadian Prime Rate Loan in the Principal Amount
equal to its maturing BA Equivalent Loan; and


 


(iv)                              the
Canadian Administrative Agent shall promptly and in any event within three (3)
Business Days following the BA Maturity Date of such Bankers’ Acceptances and
such BA Equivalent Loans, notify the Canadian Borrower in writing of the making
of or converting to such Canadian Prime Rate Loan pursuant to this Section
2.12(f).


 


(g)                                 If,
in the sole judgment of a Canadian Tranche Revolving Lender, such Lender is
unable, as a result of applicable law, customary market practice, or otherwise,
to extend credit by way of Bankers’ Acceptances in accordance with this
Agreement, such Lender shall give notice to such effect to the Canadian
Administrative Agent and the
Canadian Borrower prior to 11:00 a.m. Eastern time, on the date of the
requested credit extension (which notice may, if so stated therein, remain in
effect with respect to subsequent requests for extension of credit by way of
Bankers’ Acceptances until revoked by notice to the Administrative Agents and
the Canadian Borrower) and shall make available to the Canadian Administrative
Agent, in accordance with this Section 2.12 hereof prior to 2:00 p.m.
Eastern time, on the date of such requested credit extension, a BA Equivalent
Loan in an amount equal to the BA Net Proceeds equivalent to such Lender’s
Canadian Tranche Percentage of the total amount of credit requested to be
extended by way of Bankers’ Acceptances.


 


(h)                                 It
is the intention of the Canadian Administrative Agent, the Canadian Tranche
Revolving Lenders, and the Canadian Borrower that, except to the extent a
Canadian Tranche Revolving Lender advises otherwise, pursuant to the DBNA, all
Bankers’ Acceptances accepted by the Canadian Tranche Revolving Lenders under
this Agreement shall be issued in the form of a “depository bill” (as defined
in the DBNA), deposited with the Canadian Depository for Securities Ltd. and
made payable to CDS & Co.


 


(i)                                     If
any Event of Default shall have occurred and be continuing, on the Business Day
that the Canadian Borrower receives notice from the Canadian Tranche Revolving
Lenders with BA Exposure representing greater than 662/3%
of the total BA Exposure or, if the maturity of the Loans has been accelerated,
from the Canadian Administrative Agent, the US Administrative Agent, or the
Majority Lenders, demanding the deposit of cash collateral pursuant to this
paragraph, the Canadian Borrower shall deposit in an account with the Canadian
Administrative Agent, in the name of the Canadian Administrative Agent and for
the benefit of the Canadian Tranche Revolving Lenders, an amount in cash equal
to the BA Exposure of the Canadian Borrower as of such date plus any accrued
and unpaid interest thereon; provided that the obligation to deposit
such cash collateral shall become effective immediately, and such deposit shall
become immediately due and payable, without demand or other notice of any kind,
upon the occurrence of any Event of Default described in Section 11.01(f)
or Section 11.01(g).  Any such
deposit shall be held by the Canadian Administrative Agent as collateral for
the payment and performance of the obligations of the Canadian Borrower under
this Agreement.


 


47





















 


The Canadian Administrative
Agent shall have exclusive dominion and control, including the exclusive right
of withdrawal, over such account.  Other
than any interest earned on the investment of such deposits, which investments
shall be made at the option and sole discretion of the Canadian Administrative
Agent and at the Canadian Borrower’s risk and expense, such deposits shall not
bear interest.  Interest or profits, if
any, on such investments shall accumulate in such account.  Moneys in such account shall be applied by
the Canadian Administrative Agent for the satisfaction of the obligations of
the Canadian Borrower with respect to the BA Exposure at such time or, if the
maturity of the Loans has been accelerated, be applied to satisfy other
obligations of the Canadian Borrower under this Agreement (but subject to the
consent of Canadian Tranche Revolving Lenders with BA Exposure representing
greater than 50% of the total BA Exposure). 
If the Canadian Borrower is required to provide an amount of cash
collateral hereunder as a result of the occurrence of an Event of Default, such
amount (to the extent not applied as aforesaid) shall be returned to the
Canadian Borrower within three (3) Business Days after all Events of Default
have been cured or waived.


 


(j)                                     Drafts
of the Canadian Borrower to be accepted as Bankers’ Acceptances and BA
Equivalent Notes hereunder shall be duly executed on behalf of the Canadian
Borrower. Notwithstanding that any person whose signature appears on any
Bankers’ Acceptance or BA Equivalent Note as a signatory for the Canadian
Borrower may no longer be an authorized signatory for the Canadian Borrower at
the date of issuance of a Bankers’ Acceptance or advance of a BA Equivalent
Loan, such signature shall nevertheless be valid and sufficient for all
purposes as if such authority had remained in force at the time of such
issuance or advance, and any such Bankers’ Acceptance or BA Equivalent Note so
signed shall be binding on the Canadian Borrower.


 


(k)                                  Each
Canadian Tranche Revolving Lender may at any time and from time to time hold,
sell, rediscount or otherwise dispose of any or all Bankers’ Acceptances
accepted and purchased by it.


 


Section 2.13                                Joint
and Several Liability of the US Borrowers. 
Subject to Section 2.14:


 


(a)                                  Each
of the US Borrowers is accepting joint and several liability hereunder in
consideration of the financial accommodation to be provided by the Lenders
under this Agreement, for the mutual benefit, directly and indirectly, of each
of the US Borrowers and in consideration of the undertakings of each of the US
Borrowers to accept joint and several liability for the obligations of each of
them.


 


(b)                                 Each
of the US Borrowers jointly and severally hereby irrevocably and
unconditionally accepts, not merely as a surety but also as a co-debtor, joint
and several liability with the other US Borrower with respect to the payment
and performance of all of the obligations arising under this Agreement and the
other Loan Documents, it being the intention of the parties hereto that all of
the obligations hereunder and under the other Loan Documents shall be the joint
and several obligations of each of the US Borrowers without preferences or
distinction between them.


 


(c)                                  If
and to the extent that either of the US Borrowers shall fail to make any
payment with respect to any of the obligations hereunder as and when due or to
perform any of such


 


48





















 


obligations in accordance with
the terms thereof, then in each such event, the other US Borrower will make
such payment with respect to, or perform, such obligation.


 


(d)                                 The
provisions of this Section 2.13 are made for the benefit of the Lenders
and their successors and assigns and may be enforced by them from time to time
against either of the US Borrowers as often as occasion therefor may arise and
without requirement on the part of the Lenders first to marshall any of its
claims or to exercise any of its rights against the other US Borrower or to
exhaust any remedies available to it against the other US Borrower or to resort
to any other source or means of obtaining payment of any to the obligations
hereunder or to elect any other remedy. 
The provisions of this Section 2.13 shall remain in effect until
all the obligations hereunder shall have been paid in full or otherwise fully
satisfied.  If at any time, any payment,
or any part thereof, made in respect of any of the obligations, is rescinded or
must otherwise be restored or returned by the Lenders upon the insolvency,
bankruptcy or reorganization of any of the US Borrowers, or otherwise, the
provisions of this Section 2.13 will forthwith be reinstated an in
effect as though such payment had not been made.


 


(e)                                  Notwithstanding
any provision to the contrary contained herein or in any of the other Loan
Documents, to the extent the obligations of either US Borrower shall be
adjudicated to be invalid or unenforceable for any reason (including, without
limitation, because of any applicable state or federal law relating to
fraudulent conveyances or transfers) then the obligations of such US Borrower
hereunder shall be limited to the maximum amount that is permissible under
applicable law (whether federal or state and including, without limitation, the
Bankruptcy Code).


 


(f)                                    Each
US Borrower hereby appoints the other US Borrower to act as its agent for all
purposes under this Agreement (including, without limitation, with respect to
all matters relating to the borrowing, conversion, continuance and repayment of
Loans and the applications for the issuance, renewal, extensions or reissuance
of a Letter of Credit) and agrees that (i) any notice or communication delivered
by the US Administrative Agent or a Lender to a US Borrower shall be deemed
delivered to both US Borrowers and (ii) the US Administrative Agent and the
Lenders may accept, and be permitted to rely on, any notice, document,
instrument or agreement executed by one US Borrower on behalf of the other US
Borrower.


 


Section 2.14                                Conditions
for Holdings to Become Sole US Borrower. 
Notwithstanding anything in this Agreement or in the other Loan
Documents to the contrary, including without limitation, Section 2.13:


 


(a)                                  Holdings
shall have the right to elect to become the sole US Borrower after (i) the Debt
described in Sections 10.01(b), (d), (f) and (k)
(excluding performance guaranties and bonds) are
refinanced, paid off or assumed by Holdings and UCI is released from such Debt
except for unsecured guaranties by UCI of such Debt and except that UCI may
remain the primary obligor on up to $10,000,000 of such Debt and (ii) UCI shall
have executed the Guarantee and Collateral Agreement guaranteeing the performance
and payment obligations of Holdings under the Loan Documents.


 


(b)                                 Holdings
shall submit a certificate to the US Administrative Agent substantially in the
form of Exhibit G of its election described in subsection (a) above
and upon the delivery of such certificate Holdings shall irrevocably have all
of the rights and obligations of the sole US


 


49





















 


Borrower under the Loan
Documents (including, without limitation, any Loans made prior to such
notification) and UCI shall be automatically released as a Borrower under this
Agreement and the other Loan Documents, including, without limitation,  any Letter of Credit Application.


 


(c)                                  Notwithstanding
the use of the term “US Borrowers” as set forth in the Loan Documents:  (i) prior to Holdings having sole rights or
obligations as a US Borrower, as set forth in clause (a) above, the terms “US
Borrowers” or “a US Borrower” as used in the Loan Documents shall mean a
reference to Holdings and UCI and (ii) on and after the date that Holdings
becomes the sole US Borrower, in accordance with clause (b) above, the terms “US
Borrowers” or “a US Borrower” as used in the Loan Documents, including without
limitation, any Letter of Credit Application shall only mean a reference to
Holdings.


 


ARTICLE III

Payments of Principal and Interest


 


Section 3.01                                Repayment
of Loans.


 


(a)                                  Revolving
Loans.  On the Revolving Credit
Maturity Date the Borrowers shall pay to the Applicable Administrative Agent,
for the account of each Applicable Lender, the outstanding aggregate principal
and accrued and unpaid interest under the Revolving Loans.


 


(b)                                 Term
Loans.  The US Borrowers shall pay to
the US Administrative Agent, for the account of each Applicable Lender, the
Term Loans in an initial installment on or before June 30, 2005 and thereafter
in consecutive quarterly installments on or before each Quarterly Date, as set
forth below:


 




	
  Payment Date

  	
   

  	
  Principal Installment

  	
   

  
	
  June 30, 2005

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  September 30, 2005

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  December 31, 2005

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  March 31, 2006

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  June 30, 2006

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  September 30, 2006

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  December 31, 2006

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  March 31, 2007

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  June 30, 2007

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  September 30, 2007

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  December 31, 2007

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  March 31, 2008

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  June 30, 2008

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  September 30, 2008

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  December 31, 2008

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  March 31, 2009

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  June 30, 2009

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  September 30, 2009

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  December 31, 2009

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  March 31, 2010

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  June 30, 2010

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  September 30, 2010

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  December 31, 2010

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  March 31, 2011

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
	
  June 30, 2011

  	
   

  	
  $

  	
  94,000,000.00

  	
   

  
	
  September 30, 2011

  	
   

  	
  $

  	
  94,000,000.00

  	
   

  
	
  December 31, 2011

  	
   

  	
  $

  	
  94,000,000.00

  	
   

  
	
  Term Loan Maturity Date

  	
   

  	
  $

  	
  94,000,000.00

  	
   

  
	
  Total

  	
   

  	
  $

  	
  400,000,000.00

  	
   

  






 


50





















 


; provided
that upon any partial prepayment pursuant to Section 2.07, such
prepayment shall be applied inversely to the remaining installments in
accordance with Section 2.07.


 


If not sooner
paid, the US Borrowers promise to repay in full the Term Loans on the Term Loan
Maturity Date.


 


Section 3.02                                Interest.


 


(a)                                  Interest
Rates.  The Borrowers will pay to the
Applicable Administrative Agent, for the account of each Applicable Lender,
interest on the unpaid principal amount of each Loan made by such Lender for
the period commencing on the date such Loan is made to, but excluding, the date
such Loan shall be paid in full, at the following rates per annum:


 


(i)                                     with
respect to the Revolving Credit Facility, if such a Loan is a US Dollar Base
Rate Loan, the US Dollar Base Rate (as in effect from time to time) plus the
Applicable Margin, but in no event to exceed the Highest Lawful Rate;


 


(ii)                                  with
respect to the Revolving Credit Facility, if such a Loan is a US Dollar LIBOR
Loan, for each Interest Period relating thereto, the US Dollar LIBO Rate for
such Loan plus the Applicable Margin (as in effect from time to time), but in
no event to exceed the Highest Lawful Rate;


 


(iii)                               with
respect to the Revolving Credit Facility, if such a Loan is a Canadian Prime
Rate Loan, the Canadian Prime Rate (as in effect from time to time) plus the
Applicable Margin, but in no event to exceed the Highest Lawful Rate;


 


(iv)                              with
respect to the Term Loan B Facility, if such Loan is a US Dollar Base Rate
Loan, the US Dollar Base Rate (as in effect from time to time) plus the Applicable Margin, but in no event to
exceed the Highest Lawful Rate; and


 


(v)                                 with
respect to the Term Loan B Facility, if such Loan is a US Dollar LIBOR Loan,
for each Interest Period relating thereto, the US Dollar LIBO Rate for such
Loan plus the Applicable Margin, but in no event to exceed the Highest Lawful
Rate.


 


(b)                                 Canadian
Interest.


 


(i)                                     For
purposes of disclosure under the Interest Act (Canada), where interest is
calculated pursuant Section 3.02(a)(iii) at a rate based upon a 360, 365
or 366 day year, as the case may be, (the “First Rate”), it is hereby
agreed that the rate or percentage of interest on a yearly basis is equivalent
to such First Rate multiplied by the actual number of days in the year divided
by 360, 365 or 366, as applicable.


 


51





















 


(ii)                                  Notwithstanding
the provisions of this Section 3.02 or any other provision of this
Agreement, in no event shall the aggregate “interest” (as that term is defined
in Section 347 of the Criminal Code (Canada)) exceed the effective annual rate
of interest on the “credit advanced” (as defined therein) lawfully permitted
under Section 347 of the Criminal Code (Canada).  The effective annual rate of interest shall
be determined in accordance with generally accepted actuarial practices and
principles over the term of the applicable Canadian Tranche Loan, and in the
event of a dispute, a certificate of a Fellow of the Canadian Institute of
Actuaries qualified for a period of ten (10) years appointed by the Canadian
Administrative Agent and approved by the Canadian Borrower, such approval shall
not be unreasonably withheld or delayed, will be conclusive for the purposes of
such determination absent manifest error.


 


(iii)                               A
certificate of an authorized signing officer of the US Administrative Agent as
to each amount and/or each rate of interest payable hereunder from time to time
shall be conclusive evidence of such amount and of such rate, absent manifest
error.


 


(iv)                              Wherever
in this Agreement reference is made to a rate of interest “per annum” or a
similar expression is used, such interest shall be calculated using the nominal
rate method of calculation and shall not be calculated using the effective rate
method of calculation or any other basis that gives effect to the principal of
deemed reinvestment of interest.


 


(c)                                  Post-Default
Rate.  Notwithstanding the foregoing,
each Borrower will pay to the Applicable Administrative Agent, for the account
of each Applicable Lender interest at the applicable Post-Default Rate on any
principal of any Loan (excluding Bankers’ Acceptances and BA Equivalent Loans)
made by such Lender, and (to the fullest extent permitted by law) on any other
amount payable by each Borrower hereunder, under any Loan Document or under any
Note held by such Lender to or for account of such Lender, for the period
commencing on the date of an Event of Default until the same is paid in full or
all Events of Default are cured or waived.


 


(d)                                 Due
Dates.  Accrued interest on US Dollar
Base Rate Loans and Canadian Prime Rate Loans shall be payable on each
Quarterly Date, and accrued interest on each US Dollar LIBOR Loan shall be
payable on the last day of the Interest Period therefor and, if such Interest
Period is longer than three months, at three-month intervals following the
first day of such Interest Period, except that interest payable at the
Post-Default Rate shall be payable from time to time on demand and interest on
any US Dollar LIBOR Loan that is converted into a US Dollar Base Rate Loan
(pursuant to Section 5.04) shall be payable on the date of
conversion (but only to the extent so converted).  Any accrued and unpaid interest on the
Revolving Loans shall be paid on the Revolving Credit Maturity Date.  Any accrued and unpaid interest on the Term
Loans shall be paid on the Term Loan Maturity Date.


 


(e)                                  Determination
of Rates.  Promptly after the
determination of any interest rate provided for herein or any change therein,
the US Administrative Agent shall notify the Lenders (including the Canadian
Administrative Agent) to which such interest is payable and the Applicable
Borrower thereof.  Each determination by
the US Administrative Agent of an interest rate or fee hereunder shall, except
in cases of manifest error, be final, conclusive and binding on the parties.


 


52





















 


ARTICLE IV

Payments; Pro Rata Treatment; Computations; Etc.


 


Section 4.01                                Payments.  Except to the extent otherwise provided
herein, all payments of principal, interest and other amounts to be made by
each Borrower under this Agreement and the Notes shall be made in US Dollars in
the case of US Tranche Loans, and in Canadian Dollars or US Dollars, as the
case may be, in the case of Canadian Tranche Loans, in immediately available
funds, to the Applicable Administrative Agent at such account as such
Applicable Administrative Agent shall specify by notice to the Applicable
Borrower from time to time, not later than 1:00 p.m. Eastern time on the date
on which such payments shall become due (each such payment made after such time
on such due date to be deemed to have been made on the next succeeding Business
Day).  Such payments shall be made
without (to the fullest extent permitted by applicable law) defense, set-off or
counterclaim.  Each such payment so
received by the Applicable Administrative Agent under this Agreement or any
Note for account of a Lender shall be paid promptly to such Lender in
immediately available funds.  Except as
otherwise provided in the definition of “Interest Period”, if the due date of
any payment under this Agreement or any Note would otherwise fall on a day
which is not a Business Day such date shall be extended to the next succeeding
Business Day and interest shall be payable for any principal so extended for
the period of such extension.  At the
time of each payment to the Applicable Administrative Agent of any principal of
or interest on any Borrowing, the Applicable Borrower shall notify the Applicable
Administrative Agent of the Loans to which such payment shall apply.  In the absence of such notice, the
Administrative Agents may specify the Loans to which such payment shall apply,
but to the extent possible such payment or prepayment will be applied first to
the Loans comprised of US Dollar Base Rate Loans or Canadian Prime Rate Loans.


 


Section 4.02                                Pro
Rata Treatment.  Except to the extent
otherwise provided herein, each Lender agrees that:  (a) each Borrowing from the Lenders under Section 2.01
and each continuation and conversion under Section 2.02 shall be
made from the Applicable Lenders pro rata in accordance with their US Tranche
Percentages, Canadian Tranche Percentages or Term Loan Percentages, as the case
may be, each payment of fees under Section 2.04 shall be made for
account of the Applicable Lenders pro rata in accordance with such same
percentages; (b) each termination or reduction of the amount of the Aggregate
US Tranche Commitments under Section 2.03(b) shall be applied to
the US Tranche Commitment of each Applicable Lender, pro rata in accordance
with its US Tranche Percentage; (c) each allocation and reallocation of the
Aggregate US Tranche Commitments and the Canadian Allocated Commitments under Section
2.03(c) shall be made for the account of each US Tranche Revolving Lender
and each Canadian Tranche Revolving Lender according to its respective
Percentage Share; (d) each payment of commitment fees under Section 2.04(a)
shall be made to each US Tranche Revolving Lender and Canadian Tranche
Revolving Lender in accordance with their respective Percentage Shares; (e)
each payment or prepayment of principal of Loans by each Borrower shall be made
for account of the Applicable Lenders pro rata in accordance with the
respective unpaid principal amount of the Loans held by the Applicable Lenders;
(f) each payment of interest on Loans by each Borrower shall be made for
account of the Applicable Lenders pro rata in accordance with the amounts of
interest due and payable to the respective Lenders; and (g) each reimbursement
by the US Borrowers of disbursements under Letters of Credit shall be made for
account of the Issuing Bank or, if funded by the US Tranche Revolving Lenders,
pro rata for the account of the


 


53





















 


US Tranche Revolving Lenders,
in accordance with the amounts of reimbursement obligations due and payable to
each respective US Tranche Revolving Lender.


 


Section 4.03                                Computations.  Interest on US Dollar LIBOR Loans and fees
shall be computed on the basis of a year of 360 days and actual days
elapsed (including the first day but excluding the last day) occurring in the
period for which such interest is payable, unless such calculation would exceed
the Highest Lawful Rate, in which case interest shall be calculated on the per
annum basis of a year of 365 or 366 days, as the case may be.  Interest on US Dollar Base Rate Loans shall
be computed on the basis of a year of 365 or 366 days, as the case may be,
and actual days elapsed (including the first day but excluding the last day)
occurring in the period for which such interest is payable.  Interest on Canadian Prime Rate Loans shall
be computed as provided in Section 3.02(b).


 


Section 4.04                                Agent
Reliance.  Unless the US
Administrative Agent shall have received notice from a Lender before the date
of any Borrowing of the proceeds of the Loan that such Lender will not make
available to the Applicable Administrative Agent such Lender’s Percentage Share
of such advance, such Applicable Administrative Agent may assume that such Lender
has made its Percentage Share of such Borrowing available to such Applicable
Administrative Agent on the date of such Borrowing in accordance with Section 2.02(c)
and such Applicable Administrative Agent may, in reliance upon such assumption,
make available to the Applicable Borrower on such date a corresponding
amount.  If and to the extent that such
Lender shall not have so made its Percentage Share of such Borrowing available
to such Applicable Administrative Agent, such Lender agrees to immediately pay
to such Applicable Administrative Agent on demand such corresponding amount,
together with interest on such amount, for each day from the date such amount
is made available to the Applicable Borrower until the date such amount is paid
to the Applicable Administrative Agent, at the overnight Federal Funds
Rate.  If such Lender shall pay to the
Applicable Administrative Agent such corresponding amount and interest as
provided above, such corresponding amount so paid shall constitute such Lender’s
advance as part of such Borrowing for purposes of this Agreement even though
not made on the same day as the other advances comprising such Borrowing.


 


Section 4.05                                Set-off,
Sharing of Payments, Etc.


 


(a)                                  Each
Borrower agrees that, in addition to (and without limitation of) any right of
set-off, bankers’ lien or counterclaim a Lender may otherwise have, each Lender
shall have the right and be entitled (after consultation with the US
Administrative Agent), at its option, to offset balances held by it or by any
of its Affiliates for account of the Applicable Borrower at any of its offices,
in US Dollars or in any other currency, against any principal of or interest on
any of such Lender’s Loans, or any other amount payable to such Lender
hereunder, which is not paid when due (including applicable grace periods)
(regardless of whether such balances are then due to such Borrower), in which
case it shall promptly notify the Applicable Borrower and the US Administrative
Agent thereof, provided that such Lender’s failure to give such notice
shall not affect the validity thereof.


 


(b)                                 If
any Lender shall obtain payment of any principal of or interest on any Loan
made by it to a Borrower under this Agreement (or reimbursement as to any
Letter of Credit) through the exercise of any right of set-off, banker’s lien
or counterclaim or similar right or otherwise, and, as a result of such
payment, such Lender shall have received a greater percentage


 


54





















 


of the principal or interest
(or reimbursement) then due hereunder by the Applicable Borrower to such Lender
than the percentage received by any other Applicable Lenders, it shall promptly
(i) notify the US Administrative Agent and each other Lender (including
the Canadian Administrative Agent) thereof and (ii) purchase from such
other Applicable Lenders participations in (or, if and to the extent specified
by such Applicable Lender, direct interests in) the Loans (or participations in
Letters of Credit) made by such other Applicable Lenders (or in interest due
thereon, as the case may be) in such amounts, and make such other adjustments
from time to time as shall be equitable, to the end that all the Applicable
Lenders shall share the benefit of such excess payment (net of any expenses which
may be incurred by such Lender in obtaining or preserving such excess payment)
pro rata in accordance with the unpaid principal and/or interest on the Loans
held by each of the Applicable Lenders (or reimbursements of Letters of
Credit).  To such end all the Applicable
Lenders shall make appropriate adjustments among themselves (by the resale of
participations sold or otherwise) if such payment is rescinded or must
otherwise be restored.  Each Borrower
agrees that any Lender so purchasing a participation (or direct interest) in
the Loans made by other Lenders (or in interest due thereon, as the case may
be) may exercise all rights of set-off, banker’s lien, counterclaim or similar
rights with respect to such participation as fully as if such Lender were a
direct holder of Loans (or Letters of Credit) in the amount of such
participation.  Nothing contained herein
shall require any Lender to exercise any such right or shall affect the right
of any Lender to exercise, and retain the benefits of exercising, any such
right with respect to any other indebtedness or obligation of each
Borrower.  If under any applicable
bankruptcy, insolvency or other similar law, any Lender receives a secured
claim in lieu of a set-off to which this Section 4.05 applies, such
Lender shall, to the extent practicable, exercise its rights in respect of such
secured claim in a manner consistent with the rights of the Applicable Lenders
entitled under this Section 4.05 to share the benefits of any
recovery on such secured claim.


 


(c)                                  Notwithstanding
anything to the contrary contained in this Agreement, the Lenders hereby agree
that they shall not set off any funds in any lock boxes whatsoever in
connection with this Agreement, except for such lock boxes which may be
established in connection with this Agreement.


 


Section 4.06                                Taxes.


 


(a)                                  Payments
Free and Clear.  Any and all payments
by each Borrower hereunder shall be made, in accordance with Section 4.01,
free and clear of and without deduction for any and all present or future
taxes, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding, in the case of each Lender, the
Issuing Bank and the Administrative Agents (each a “Recipient”), taxes
imposed on its income, and franchise or similar taxes imposed on it, by
(i) any jurisdiction (or political subdivision thereof) of which such
Recipient is a citizen or resident or in which such Lender has an Applicable
Lending Office, (ii) the jurisdiction (or any political subdivision thereof)
in which such Recipient is organized, or (iii) any jurisdiction (or
political subdivision thereof) in which such Recipient is presently doing
business which taxes are imposed solely as a result of doing business in such
jurisdiction (all such non-excluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities being hereinafter referred to as “Taxes”).  If any Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder to a
Recipient, (A) except as provided in Section 13.06(b), the sum payable
shall be increased by the amount necessary so that after


 


55





















 


making all required deductions
(including deductions applicable to additional sums payable under this Section 4.06)
such Recipient shall receive an amount equal to the sum it would have received
had no such deductions been made, (B) such Borrower shall make such deductions
and (C) such Borrower shall pay the full amount deducted to the relevant taxing
authority or other Governmental Authority in accordance with applicable law.


 


(b)                                 Other
Taxes.  In addition, to the fullest
extent permitted by applicable law, each Borrower agrees to pay any present or
future stamp or documentary taxes or any other excise or property taxes,
charges or similar levies that arise from any payment made hereunder or from
the execution, delivery or registration of, or otherwise with respect to, this
Agreement, any Assignment or any Security Instrument (hereinafter referred to
as “Other Taxes”).


 


(c)                                  Indemnification.  To the fullest extent permitted by applicable
law, the US Borrowers will indemnify each Lender and the Issuing Bank and the
Administrative Agents for the full amount of Taxes and Other Taxes (including,
but not limited to, any Taxes or Other Taxes imposed by any Governmental
Authority on amounts payable under this Section 4.06) paid by such
Lender, the Issuing Bank or the Administrative Agents (on their behalf or on
behalf of any Lender), as the case may be, and any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or legally asserted
unless the payment of such Taxes was not correctly or legally asserted and such
Lender’s payment of such Taxes or Other Taxes was the result of its or its
officers’, employees’, agents’ or representatives’ gross negligence or willful
misconduct.  Any payment pursuant to such
indemnification shall be made within thirty (30) days after the date any
Lender, the Issuing Bank or the Administrative Agents, as the case may be, make
written demand therefor.  If any Lender,
Issuing Bank, the US Administrative Agent or the Canadian Administrative Agent
receives a refund or credit in respect of any Taxes or Other Taxes for which
such Lender, Issuing Bank, the US Administrative Agent or the Canadian
Administrative Agent has received payment from the Applicable Borrower it shall
promptly notify the Applicable Borrower of such refund or credit and shall, if no
default has occurred and is continuing, within thirty (30) days after
receipt of a request by the Applicable Borrower (or promptly upon receipt, if
the Applicable Borrower has requested application for such refund or credit
pursuant hereto), pay an amount equal to such refund or credit to the
Applicable Borrower without interest (but with any interest so refunded or
credited), provided that the Applicable Borrower, upon the request of
such Lender, Issuing Bank, the US Administrative Agent or the Canadian Administrative
Agent, agrees to return such refund or credit (plus penalties, interest or
other charges) to such Lender, Issuing Bank, the US Administrative Agent or the
Canadian Administrative Agent in the event such Lender, Issuing Bank or
Administrative Agent is required to repay such refund or credit.


 


(d)                                 Lender
Representations.


 


(i)                                     Each
US Lender represents that it is either (A) a “United States person” (as such
term is defined in Code Section 7701(a)(30)) or (B) is entitled to complete
exemption from United States withholding tax imposed on or with respect to any
payments, including fees, to be made to it pursuant to this Agreement
(1) under an applicable provision of a tax convention to which the United
States of America is a party, (2) pursuant to Code Sections 871(h) or 881(c),
or (3) because it is acting through a branch, agency or office in the
United States of America and any payment to be received


 


56





















 


by it hereunder is effectively connected with
a trade or business in the United States of America.  Each US Lender that is not a “United States
person” (as such term is defined in Code Section 7701(a)(30)) agrees to provide
to the US Borrowers and the US Administrative Agent on the Closing Date, or on
the date of its delivery of the Assignment pursuant to which it becomes a US
Tranche Revolving Lender or Term Loan Lender, and at such other times as
required by United States law or as a US Borrower or the US Administrative
Agent shall reasonably request, two accurate and complete original signed
copies of IRS Form W-8BEN, W-8ECI or W-8IMY (or successor or other applicable
forms prescribed by the IRS) certifying to such US Lender’s entitlement to a
complete exemption from United States withholding tax on interest payments to
be made under this Agreement; provided,
however, that no such US Lender shall
be required to deliver an IRS Form W-8BEN, W-8ECI, or W-8IMY to the extent that
the delivery of such form is not authorized by law due to a change in a Governmental
Requirement occurring subsequent to the date on which a form was originally
required to be provided; provided  further, however,
that in the event that a US Lender provides the US Borrowers or the US
Administrative Agent with an IRS Form W-8-IMY (or substitute form) indicating
that it is a “flow through” entity, as defined in Treasury Regulations
promulgated under Code Section 1441, or otherwise, not a beneficial owner of
interest payments under this Agreement, such US Lender agrees, on or prior to the
Closing Date, or the date of Assignment to such US Lender, as applicable, to
take any actions necessary, and to deliver to the US Borrowers and the US
Administrative Agent all forms necessary, to establish such US Lender’s
entitlement to a complete exemption from United States withholding tax on
payments of interest to be made under this Agreement, including causing its
partners, members, beneficiaries, beneficial owners, and their beneficial
owners, if any, to take any actions and deliver any forms necessary to
establish such exemption. 
Notwithstanding the foregoing, a withholding foreign partnership,
withholding foreign trust, and qualified intermediary shall only provide such
information as is required by Treasury Regulations promulgated under Code Section
1441.  For purposes of this Agreement,
the term “forms” shall include any attachments to IRS Forms W-8IMY required to
be filed by the US Lender.


 


(ii)                                  Each
US Lender that is a “United States person” (as such term is defined in Code
Section 7701(a)(30)) shall provide two properly completed and duly executed
copies of IRS Form W-9, or any successor or other applicable form.  Each such US Lender shall deliver to the US
Borrower and the US Administrative Agent (provided that such US Lender remains
lawfully able to do so), two further duly executed copies of such form or
statement, properly completed in all material respects, at or before the time
any such form or statement expires or becomes obsolete, or otherwise as
reasonably requested by the US Borrowers. 
Each such US Lender shall promptly notify the US Borrowers at any time
it determines that it is no longer in a position to provide any previously
delivered form or statement to the US Borrowers and the US Administrative Agent
(or any other form or statement adopted by U.S. taxing authorities for such
purpose).


 


(iii)                               Each
US Lender also agrees to deliver to the US Borrowers and the US Administrative
Agent such other or supplemental forms as may at any time be required as a
result of changes in applicable law or regulation in order to confirm or
maintain in effect its entitlement to exemption from United States withholding
tax on any payments


 


57





















 


hereunder, provided that the
circumstances of such US Lender at the relevant time and applicable laws permit
it to do so.  If a US Lender determines,
as a result of any change in either (i) a Governmental Requirement or (ii) its
circumstances, that it is unable to submit any form or certificate that it is
obligated to submit pursuant to this Section 4.06, or that it is
required to withdraw or cancel any such form or certificate previously
submitted, it shall promptly notify the US Borrowers and the US Administrative
Agent of such fact.  Except as provided
in Section 4.06(d)(iv), each US Lender agrees to indemnify and hold
harmless the US Borrowers or the US Administrative Agent, as applicable, from
any United States taxes, penalties, interest and other expenses, costs and
losses incurred or payable by (A) the US Borrowers or the US
Administrative Agent as a result of such US Lender’s failure to submit any form
or certificate that it is required to provide pursuant to this Section 4.06
or (B) the US Borrowers or the US Administrative Agent as a result of their
reliance on any such form or certificate which such US Lender has provided to
them pursuant to this Section 4.06.


 


(iv)                              For
any period with respect to which a US Lender has failed to provide the US
Borrowers with the form required pursuant to this Section 4.06, if any
(other than if such failure is due to a change in a Governmental Requirement
occurring subsequent to the date on which a form originally was required to be
provided, in which case, such US Lender shall be entitled to indemnification
under this Section 4.06 (including, without limitation, the right to
receive additional amounts pursuant to Section 4.06(a)(A)) and shall not
be required to indemnify the US Borrowers or the US Administrative Agent
pursuant to Section 4.06(d)(iii)(A)), such US Lender shall not be
entitled to indemnification under Section 4.06 with respect to
taxes imposed by the United States which taxes would not have been imposed but
for such failure to provide such forms; provided, however, that
if a US Lender, which is otherwise exempt from or subject to a reduced rate of
withholding tax, becomes subject to taxes because of its failure to deliver a
form required hereunder, the US Borrowers shall take such steps as such US
Lender shall reasonably request to assist such US Lender to recover such taxes.


 


(v)                                 Any
US Lender claiming any additional amounts payable pursuant to this Section 4.06
shall use reasonable efforts (consistent with legal and regulatory
restrictions) to file any certificate or document requested by the US Borrowers
or the US Administrative Agent or to change the jurisdiction of its Applicable
Lending Office or to contest any tax imposed if the making of such a filing or
change or contesting such tax would avoid the need for or reduce the amount of
any such additional amounts that may thereafter accrue and would not, in the
sole determination of such US Lender, be otherwise disadvantageous to such US
Lender.


 


(vi)                              Each
Canadian Tranche Revolving Lender represents that it is (A) either (x) not a
non-resident of Canada for purposes of the Income Tax Act (Canada) or (y) a
deemed resident of Canada for purposes of Part XIII of the Income Tax Act
(Canada) and (B) an Affiliate of a US Tranche Revolving Lender.  Each Canadian Tranche Revolving Lender agrees
to indemnify and hold harmless the Canadian Borrower or the Canadian
Administrative Agent, as applicable, from any Canadian taxes, penalties,
interest and other expenses, costs and losses incurred or payable by the
Canadian Borrower or the Canadian Administrative Agent as a result of its
reliance on any representation in this


 


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Section 4.06(d)(vi)
(other than if such misrepresentation is due to a change in a Governmental
Requirement occurring subsequent to the date on which such representation was
made, in which case, such Canadian Tranche Revolving Lender shall be entitled
to indemnification under this Section 4.06 (including, without
limitation, the right to receive additional amounts pursuant to Section
4.06(a)(A)) and shall not be required to indemnify the Canadian Borrower or
the Canadian Administrative Agent pursuant to Section 4.06(d)(vi)).


 


ARTICLE V

Capital Adequacy


 


Section 5.01                                Additional
Costs.


 


(a)                                  Regulations,
etc.  The Borrowers shall pay
directly to each Applicable Lender from time to time such amounts as such
Lender may determine to be necessary to compensate such Lender for any costs
which it determines are attributable to its making or maintaining of any US
Dollar LIBOR Loans, accepting and purchasing Bankers’ Acceptances, making or
maintaining BA Equivalent Loans or issuing or participating in Letters of
Credit hereunder or its obligation to make any US Dollar LIBOR Loans, purchase
any Bankers’ Acceptances, make any BA Equivalent Loans or issue or participate
in any Letters of Credit hereunder, or any reduction in any amount receivable
by such Lender hereunder in respect of any of such US Dollar LIBOR Loans,
Bankers’ Acceptances, BA Equivalent Loans, Letters of Credit or such
obligation, resulting from any Regulatory Change which:  (i) changes the basis of taxation of any
amounts payable to such Lender under this Agreement or any Note or BA
Equivalent Note in respect of any of such US Dollar LIBOR Loans, Bankers’
Acceptances, BA Equivalent Loans or Letters of Credit (other than taxes imposed
on the overall net income of such Lender or of its Applicable Lending Office
for any of such US Dollar LIBOR Loans by the jurisdiction in which such Lender
has its principal office or Applicable Lending Office); or (ii) imposes or
modifies any reserve, special deposit, minimum capital, capital ratio or
similar requirements relating to any extensions of credit or other assets of,
or any deposits with or other liabilities of such Lender, or the US Tranche
Commitment, Canadian Allocated Commitment, Term Commitment or Loans of such
Lender or the London interbank market; or (iii) imposes any other condition
affecting this Agreement or any Note or BA Equivalent Note (or any of such
extensions of credit or liabilities) or such Lender’s US Tranche Commitment,
Canadian Allocated Commitment, Term Commitment or Loans.  Each Lender will notify the US Administrative
Agent and the Applicable Borrower of any event occurring after the Closing Date
which will entitle such Lender to compensation pursuant to this Section 5.01(a)
as promptly as practicable after it obtains knowledge thereof and determines to
request such compensation, and will designate a different Applicable Lending
Office for the Loans of such Lender affected by such event if such designation
will avoid the need for, or reduce the amount of, such compensation and will
not, in the sole opinion of such Lender, be disadvantageous to such Lender, provided
that such Lender shall have no obligation to so designate an Applicable Lending
Office located in the United States.  If
any Lender requests compensation from any Borrower under this Section 5.01(a),
such Borrower may, by notice to such Lender, suspend the obligation of such
Lender to make additional Loans of the Type with respect to which such
compensation is requested until the Regulatory Change giving rise to such
request ceases to be in effect (in which case the provisions of Section 5.04
shall be applicable).


 


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(b)                                 Regulatory
Change.  Without limiting the effect
of the provisions of Section 5.01(a), in the event that at any time
(by reason of any Regulatory Change or any other circumstances arising after
the Closing Date affecting (i) any Lender, (ii) the London interbank market or
(iii) such Lender’s position in such market), the US Dollar LIBO Rate, as
determined in good faith by such Lender, will not adequately and fairly reflect
the cost to such Lender of funding its US Dollar LIBOR Loans, then, if such
Lender so elects, by notice to the US Borrowers and the US Administrative
Agent, the obligation of such Lender to make additional US Dollar LIBOR Loans
shall be suspended until such Regulatory Change or other circumstances ceases
to be in effect (in which case the provisions of Section 5.04 shall
be applicable).


 


(c)                                  Capital
Adequacy.  Without limiting the
effect of the foregoing provisions of this Section 5.01 (but
without duplication), the Borrowers shall pay directly to any Applicable Lender
from time to time on request such amounts as such Lender may reasonably
determine to be necessary to compensate such Lender or its parent or holding
company for any costs which it determines are attributable to the maintenance
by such Lender or its parent or holding company (or any Applicable Lending Office),
pursuant to any Governmental Requirement following any Regulatory Change, of
capital in respect of its US Tranche Commitments, its Canadian Allocated
Commitments, its Term Commitments, its Note, its Loans or any interest held by
it in any Letter of Credit, such compensation to include, without limitation,
an amount equal to any reduction of the rate of return on assets or equity of
such Lender or its parent or holding company (or any Applicable Lending Office)
to a level below that which such Lender or its parent or holding company (or
any Applicable Lending Office) could have achieved but for such Governmental
Requirement.  Such Lender will notify the
Applicable Borrower that it is entitled to compensation pursuant to this Section 5.01(c)
as promptly as practicable after it determines to request such compensation.


 


(d)                                 Compensation
Procedure.  Any Lender notifying the
Applicable Borrower of the incurrence of additional costs under this Section 5.01
shall in such notice to such Borrower and the US Administrative Agent set forth
in reasonable detail the basis and amount of its request for compensation.  Determinations and allocations by each Lender
for purposes of this Section 5.01 of the effect of any Regulatory
Change pursuant to Section 5.01(a) or (b), or of the effect
of capital maintained pursuant to Section 5.01(c), on its costs or
rate of return of maintaining Loans or its obligation to make Loans or issue
Letters of Credit, or on amounts receivable by it in respect of Loans or
Letters of Credit, and of the amounts required to compensate such Lender under
this Section 5.01, shall be conclusive and binding for all
purposes, provided that such determinations and allocations are made on
a reasonable basis.  Any request for
additional compensation under this Section 5.01 shall be paid by
the Applicable Borrower within thirty (30) days of the receipt by such
Borrower of the notice described in this Section 5.01(d).


 


Section 5.02                                Limitation
on US Dollar LIBOR Loans.  Anything
herein to the contrary notwithstanding, if, on or prior to the determination of
any US Dollar LIBO Rate for any Interest Period:


 


(a)                                  the
US Administrative Agent determines (which determination shall be conclusive,
absent manifest error) that quotations of interest rates for the relevant
deposits referred to in the applicable definition of “US Dollar LIBO Rate”
in Section 1.02 are not being


 


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provided in the relevant
amounts or for the relevant maturities for purposes of determining rates of
interest for US Dollar LIBOR Loans as provided herein; or


 


(b)                                 the
US Administrative Agent determines (which determination shall be conclusive,
absent manifest error) that the relevant rates of interest referred to in the
applicable definition of “US Dollar LIBO Rate” in Section 1.02
upon the basis of which the rate of interest for US Dollar LIBOR Loans for such
Interest Period is to be determined are not sufficient to adequately cover the
cost to the Lenders of making or maintaining US Dollar LIBOR Loans;


 


then the US
Administrative Agent shall give the US Borrowers prompt notice thereof, and so
long as such condition remains in effect, the Lenders shall be under no
obligation to make additional US Dollar LIBOR Loans.


 


Section 5.03                                Illegality.  Notwithstanding any other provision of this
Agreement, in the event that it becomes unlawful for any Lender or its
Applicable Lending Office to honor its obligation to make or maintain US Dollar
LIBOR Loans hereunder, then such Lender shall promptly notify the US Borrowers
thereof and such Lender’s obligation to make US Dollar LIBOR Loans shall be
suspended until such time as such Lender may again make and maintain US Dollar
LIBOR Loans (in which case the provisions of Section 5.04 shall be
applicable).


 


Section 5.04                                US
Dollar Base Rate Loans Pursuant to Sections 5.01, 5.02 and 5.03.  If the obligation of any Lender to make US
Dollar LIBOR Loans shall be suspended pursuant to Sections 5.01, 5.02
or 5.03 (“Affected Loans”), all Affected Loans which would
otherwise be made by such Lender shall be made instead as US Dollar Base Rate
Loans (and, if an event referred to in Section 5.01(b) or Section 5.03
has occurred and such Lender so requests by notice to the US Borrowers, all
Affected Loans of such Lender then outstanding shall be automatically converted
into US Dollar Base Rate Loans on the date specified by the Lender in such
notice) and, to the extent that Affected Loans are so made as (or converted
into) US Dollar Base Rate Loans, all payments of principal which would
otherwise be applied to such Lender’s Affected Loans shall be applied instead
to its respective US Dollar Base Rate Loans.


 


Section 5.05                                Compensation.


 


(a)                                  The
Borrowers shall pay to each Applicable Lender within thirty (30) days of
receipt of written request of such Lender (which request shall set forth, in
reasonable detail, the basis for requesting such amounts and which shall be
conclusive and binding for all purposes provided that such
determinations are made on a reasonable basis), such amount or amounts as shall
compensate it for any loss, cost, expense or liability which such Lender
determines are attributable to:


 


(i)                                     any
payment, prepayment or conversion of a US Dollar LIBOR Loan properly made by
such Lender or any Borrower for any reason (including, without limitation, the
acceleration of the Loans pursuant to Section 11.02) on a date
other than the last day of the Interest Period for such Loan; or


 


(ii)                                  any
failure by a Borrower for any reason (including but not limited to, the failure
of any of the conditions precedent specified in ARTICLE VI to be
satisfied) to borrow, continue or convert a US Dollar LIBOR Loan from such
Lender on the date for


 


61





















 


such Borrowing, continuation or conversion specified
in the relevant notice given pursuant to Section 2.02(c).


 


Without
limiting the effect of the preceding sentence, such compensation shall include
an amount equal to the excess, if any, of (A) the amount of interest which
would have accrued on the principal amount so paid, prepaid or converted or not
borrowed for the period from the date of such payment, prepayment or conversion
or failure to borrow to the last day of the Interest Period for such Loan (or,
in the case of a failure to borrow, the Interest Period for such Loan which
would have commenced on the date specified for such Borrowing) at the
applicable rate of interest for such Loan provided for herein over (B) the
interest component of the amount such Lender would have bid in the London interbank
market for US Dollar deposits of leading banks in amounts comparable to such
principal amount and with maturities comparable to such period (as reasonably
determined by such Lender).


 


(b)                                 In
the event of (i) the payment of any Principal Amount of any BA Equivalent Loan
or Bankers’ Acceptance other than on the applicable BA Maturity Date (including
as a result of an Event of Default), (ii) the continuation of any BA Equivalent
Loan other than on the applicable BA Maturity Date, (iii) the failure to borrow
any such Bankers’ Acceptance or borrow or continue BA Equivalent Loan on the
date specified in any notice delivered pursuant hereto, (iv) the assignment of
any BA Equivalent Loan or Bankers’ Acceptance other than on the applicable BA
Maturity Date as a result of a request by the Canadian Borrower, then, in any
such event, the Canadian Borrower shall compensate each Applicable Lender for
the loss, cost and expense attributable to such event.  A certificate of any such Lender setting
forth any amount or amounts that such Lender is entitled to receive pursuant to
this Section 5.05(b) shall be delivered to the Canadian Borrower and the
Administrative Agents and shall be conclusive absent manifest error.  The Canadian Borrower shall pay such Lender
the amount shown as due on any such certificate within thirty (30) days after
receipt thereof.  Notwithstanding
anything to the contrary contained herein, nothing in this Section 5.05(b)
shall be construed as giving rise to any right of the Canadian Borrower to prepay
any Bankers’ Acceptance or BA Equivalent Loan.


 


Section 5.06                                Replacement
Lenders.


 


(a)                                  If
any Lender has notified the Borrowers and the US Administrative Agent of its
incurring additional costs under Section 5.01 or has required the
Borrowers to make payments for Taxes under Section 4.06, then the
Borrowers may, unless such Lender has notified the Borrowers and the US
Administrative Agent that the circumstances giving rise to such notice no
longer apply, terminate, in whole but not in part, the US Tranche Commitment,
Canadian Allocated Commitment and Term Loans, if any, of any Lender (other than
the Administrative Agents) (the “Terminated Lender”) at any time upon
five (5) Business Days’ prior written notice to the Terminated Lender and the
US Administrative Agent (such notice referred to herein as a “Notice of
Termination”).


 


(b)                                 In
order to effect the termination of the US Tranche Commitment, the Canadian
Allocated Commitment and the Term Loans, as applicable, of the Terminated
Lender, the Borrowers shall: 
(i) obtain an agreement with one or more Lenders to increase their
US Tranche Commitment or US Tranche Commitments, their Canadian Allocated
Commitment or Canadian Allocated Commitments and their Term Loans, as
applicable and/or (ii) request any one or more other banking institutions
to become parties to this Agreement in place and instead of such


 


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Terminated Lender and agree to
accept such commitment or commitments; provided, however, that
such one or more other banking institutions are reasonably acceptable to the
Administrative Agents and become parties by executing an Assignment and that
any replacement of a terminated Canadian Tranche Revolving Lender shall satisfy
the Canadian residency requirements of a Canadian Tranche Revolving Lender (the
Lenders or other banking institutions that agree to accept in whole or in part
the US Tranche Commitment, Canadian Allocated Commitment and Term Loans, if
any, of the Terminated Lender being referred to herein as the “Replacement
Lenders”), such that the aggregate increased and/or accepted commitments
and the Term Loans of the Replacement Lenders under clauses (i) and (ii)
above equal the US Tranche Commitment, the Canadian Allocated Commitment and
the Term Loans, if any, of the Terminated Lender.


 


(c)                                  The
Notice of Termination shall include the name of the Terminated Lender, the date
the termination will occur (the “Lender Termination Date”), and the
Replacement Lender or Replacement Lenders to which the Terminated Lender will
assign its US Tranche Commitment, Canadian Allocated Commitment and Term Loans,
if any, and, if there will be more than one Replacement Lender, the portion of
the Terminated Lender’s US Tranche Commitment, Canadian Allocated Commitment
and Term Loans, if any, to be assigned to each Replacement Lender.


 


(d)                                 On
the Lender Termination Date (i) the Terminated Lender shall by execution
and delivery of an Assignment assign its US Tranche Commitment, Canadian
Allocated Commitment and Term Loans, if any, to the Replacement Lender or
Replacement Lenders (pro rata, if there is more than one Replacement Lender, in
proportion to the portion of the Terminated Lender’s US Tranche Commitment,
Canadian Allocated Commitment and Term Loans, if any, to be assigned to each
Replacement Lender) indicated in the Notice of Termination and shall assign to
the Replacement Lender or Replacement Lenders each of its Loans (if any) then
outstanding and participation interests in Letters of Credit (if any) then
outstanding pro rata as aforesaid), (ii) the Terminated Lender shall
endorse its Note(s), Bankers’ Acceptances and BA Equivalent Notes, payable
without recourse, representation or warranty to the order of the Replacement
Lender or Replacement Lenders (pro rata as aforesaid), (iii) the
Replacement Lender or Replacement Lenders shall purchase the Note(s), Bankers’
Acceptances and BA Equivalent Notes held by the Terminated Lender (pro rata as
aforesaid) at a price equal to the unpaid principal amount thereof plus interest
and facility and other fees accrued and unpaid to the Lender Termination Date,
and (iv) the Replacement Lender or Replacement Lenders will thereupon (pro
rata as aforesaid) succeed to and be substituted in all respects for the
Terminated Lender with like effect as if becoming a Lender pursuant to the
terms of Section 13.06(b), and the Terminated Lender will have the
rights and benefits of an assignor under Section 13.06(b).  To the extent not in conflict, the terms of Section 13.06(b)
shall supplement the provisions of this Section 5.06(d).  For each assignment made under this Section 5.06,
the Replacement Lender shall pay to the Applicable Administrative Agent the
processing fee provided for in Section 13.06(b).  The Borrowers will be responsible for the payment
of any breakage costs incurred in connection with the sale of Loans by
Terminated Lenders to Replacement Lenders, as if such Loans had been prepaid
and breakage costs had accrued thereto in accordance with Section 5.05.


 


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ARTICLE VI

Conditions Precedent


 


Section 6.01                                Effectiveness.


 


The effectiveness of this Agreement and the obligation
of the Lenders to make Revolving Loans and of the Issuing Banks to issue
Letters of Credit are subject to the receipt by the US Administrative Agent and
the Lenders of all fees payable pursuant to Section 2.04 on or
before the Closing Date and the receipt by the US Administrative Agent of the
following documents and satisfaction of the other conditions provided in this Section 6.01,
each of which shall be satisfactory to the US Administrative Agent in form and
substance:


 


(a)                                  A
certificate of the Secretary or an Assistant Secretary of UCI setting forth
(i) resolutions of its board of directors with respect to the authorization
of UCI to execute and deliver the Loan Documents to which it is a party and to
enter into the transactions contemplated in those documents, (ii) the
officers of UCI (A) who are authorized to sign the Loan Documents to which
UCI is a party and (B) who will, until replaced by another officer or
officers duly authorized for that purpose, act as its representative for the
purposes of signing documents and giving notices and other communications in
connection with this Agreement and the transactions contemplated hereby,
(iii) specimen signatures of the authorized officers, and (iv) the
articles or certificate of incorporation and bylaws, certified as being true
and complete.  The Administrative Agents
and the Lenders may conclusively rely on such certificate until the
Administrative Agents receive notice in writing from UCI to the contrary.


 


(b)                                 A
certificate of the Secretary or an Assistant Secretary of the Canadian Borrower
setting forth (i) resolutions of its board of directors with respect to
the authorization of the Canadian Borrower to execute and deliver the Loan
Documents to which it is a party and to enter into the transactions
contemplated in those documents, (ii) the officers of the Canadian
Borrower (A) who are authorized to sign the Loan Documents to which the
Canadian Borrower is a party and (B) who will, until replaced by another
officer or officers duly authorized for that purpose, act as its representative
for the purposes of signing documents and giving notices and other communications
in connection with this Agreement and the transactions contemplated hereby,
(iii) specimen signatures of the authorized officers, and (iv) the
articles or certificate of amalgamation or its equivalent and bylaws or its
equivalent, certified as being true and complete.  The Administrative Agents and the Lenders may
conclusively rely on such certificate until the Administrative Agents receive
notice in writing from the Canadian Borrower to the contrary.


 


(c)                                  A
certificate of the Secretary or an Assistant Secretary of Holdings setting
forth (i) resolutions of its board of directors with respect to the
authorization of Holdings to execute and deliver the Loan Documents to which it
is a party and to enter into the transactions contemplated in those documents,
(ii) the officers of Holdings (A) who are authorized to sign the Loan
Documents to which Holdings is a party and (B) who will, until replaced by
another officer or officers duly authorized for that purpose, act as its
representative for the purposes of signing documents and giving notices and
other communications in connection with this Agreement and the transactions
contemplated hereby, (iii) specimen signatures of the authorized officers,
and (iv) the articles or certificate of incorporation and bylaws, certified
as being true and complete.  The
Administrative Agents and the Lenders may conclusively rely on such certificate
until the Administrative Agents receive notice in writing from Holdings to the
contrary.


 


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(d)                                 A
certificate of the Secretary or an Assistant Secretary (or its equivalent) of
each Subsidiary party to a Loan Document, setting forth (i) resolutions of
its board of directors (or its equivalent) with respect to the authorization of
such Subsidiary to execute and deliver the Loan Documents to which it is a
party and to enter into the transactions contemplated in those documents,
(ii) the officers (or its equivalent) of such Subsidiary (A) who are
authorized to sign the Loan Documents to which such Subsidiary is a party and
(B) who will, until replaced by another officer or officers (or its
equivalent) duly authorized for that purpose, act as its representative for the
purposes of signing documents and giving notices and other communications in
connection with this Agreement and the transactions contemplated hereby,
(iii) specimen signatures of the authorized officers (or its equivalent),
and (iv) the Organization Documents, certified as being true and complete.  The Administrative Agents and the Lenders may
conclusively rely on such certificate until they receive notice in writing from
any Borrower or such Subsidiary to the contrary.


 


(e)                                  Certificates
of the appropriate state agencies with respect to the existence, qualification
and good standing of UCI, Holdings and each Subsidiary party to a Loan
Document.


 


(f)                                    A
compliance certificate which shall be substantially in the form of Exhibit C-1,
duly and properly executed by a Responsible Officer of each US Borrower and
dated as of the Closing Date.


 


(g)                                 (i)
A counterpart of this Agreement signed on behalf of each party hereto or
(ii) written evidence satisfactory to the US Administrative Agent (which
may include telecopy or electronic transmission of a signed signature page of
this Agreement) that such party has signed a counterpart of this Agreement.


 


(h)                                 The
Revolving Notes duly completed and executed.


 


(i)                                     The
Security Instruments, including those described on Exhibit D, duly
completed and executed in sufficient number of counterparts for recording, if necessary.


 


(j)                                     An
opinion of Gardere Wynne Sewell LLP, counsel to the US Borrowers and the
Subsidiaries party to a Loan Document, in form and substance satisfactory to
the US Administrative Agent, as to such matters incident to the transactions
herein contemplated and as the US Administrative Agent may reasonably request.


 


(k)                                  A
summary of insurance coverage of the US Borrowers evidencing that each US
Borrower is carrying insurance in accordance with Section 7.19.


 


(l)                                     Copies
of Requests for Information or Copies (Form UCC-11) or equivalent commercially
obtained reports, listing all effective financing statements which name any of
Holdings or any Subsidiary party to a Loan Document (under their present names
and any previous names) as debtor and which are filed in all jurisdictions in
which such Persons are organized, together with copies of such financing
statements.


 


(m)                               A
borrowing notice in the form of Exhibit B-1, or Exhibit B-2,
as applicable duly completed and executed by the Applicable Borrower.


 


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(n)                                 A
Letter of Credit Application pertaining to each new Letter of Credit to be
issued on the Closing Date, if any, duly completed and executed by the US
Borrowers.


 


(o)                                 All
costs, fees, expenses (including, without limitation, reasonable legal fees and
expenses and recording taxes and fees) and other compensation contemplated by
this Agreement and the other Loan Documents, and for which statements or
invoices have been submitted to the US Borrowers, payable to the Lenders
through the Closing Date shall have been paid.


 


(p)                                 Except
as set forth on Schedule 6.01(q), all Property in which the US
Administrative Agent shall, at such time, be entitled to have a Lien pursuant
to this Agreement or any other Security Instrument shall have been physically
delivered to the possession of the US Administrative Agent or any bailee
accepted by the US Administrative Agent to the extent that such possession is
necessary for the purpose of perfecting the US Administrative Agent’s Lien in
such Collateral.


 


(q)                                 Each
document (including any Uniform Commercial Code financing statement) required
by this Agreement or under law or reasonably requested by the US Administrative
Agent to be filed, registered or recorded in order to create in favor of the US
Administrative Agent, for the benefit of the Lenders, a perfected Lien on the
Collateral described therein, prior and superior in right to any other Person
(other than Permitted Liens), shall be in proper form for filing, registration
or recordation.


 


(r)                                    A
rating of Ba2 from Moody’s and BB from S&P on the Revolving Credit Facility
and the Term Loan B Facility.


 


(s)                                  Concurrently
with the initial funding of the Revolving Loans, the US Borrowers shall have
repaid (i) the Existing Credit Agreement and all of the agreements evidencing
and securing such Debt shall have been terminated and the related financing
statements released, amended or assigned as required by the US Administrative
Agent and (ii) all of the Existing Tranche B Loan Facility.


 


(t)                                    An
Appraisal demonstrating the ratio of Compression Collateral to Aggregate Credit
Exposure to not be less than 1.25 to 1.00.


 


(u)                                 Such
other documents as the US Administrative Agent or any Lender or special counsel
to the US Administrative Agent may reasonably request.


 


Section 6.02                                Loans
and Letters of Credit.  The
obligation of the Lenders to make Revolving Loans to each of the Borrowers upon
the occasion of each Revolving Borrowing hereunder and to issue, renew, extend,
increase or reissue Letters of Credit for the account of the US Borrowers is
subject to the further conditions precedent that:


 


(a)                                  no
Default shall have occurred and be continuing;


 


(b)                                 no
Material Adverse Effect shall have occurred and be continuing; and


 


(c)                                  the
representations and warranties made by each Borrower in ARTICLE VII
and ARTICLE VIII and in the Security Instruments shall be true on and as
of the date of the making


 


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of such Revolving Loans or
issuance, renewal, extension, increase or reissuance of a Letter of Credit with
the same force and effect as if made on and as of such date and following such
new Revolving Borrowing, except to the extent such representations and
warranties are expressly limited to an earlier date or the Majority Lenders may
expressly consent in writing to the contrary.


 


Each request
for a Revolving Borrowing by the Borrowers or issuance, renewal, extension,
increase or reissuance of a Letter of Credit by the US Borrowers hereunder
shall constitute a certification by such Borrower to the effect set forth in Section 6.02(c)
(both as of the date of such notice and, unless such Borrower otherwise
notifies the US Administrative Agent prior to the date of and immediately
following such Revolving Borrowing or issuance, renewal, extension or
reissuance of a Letter of Credit as of the date thereof).


 


Section 6.03                                Conditions
Precedent for the Benefit of Lenders. 
All conditions precedent to the obligations of the Lenders to make any
Loan are imposed hereby solely for the benefit of the Lenders, and no other
Person may require satisfaction of any such condition precedent or be entitled
to assume that the Lenders will refuse to make any Loan in the absence of
strict compliance with such conditions precedent.


 


Section 6.04                                Conditions
Precedent to the Term Loans.  The
obligation of the Term Loan Lenders to make Term Loans under this Agreement is
subject to the receipt by the US Administrative Agent and the Term Loan Lenders
of all fees payable pursuant to Section 2.04(c) on or before the
Term Loan Funding Date and the receipt by the US Administrative Agent of the
following documents and satisfaction of the other conditions provided in this Section
6.04, each of which shall be reasonably satisfactory to the US Administrative
Agent in form and substance:


 


(a)                                  All
reasonable costs, fees, expenses (including, without limitation, legal fees and
expenses and recording taxes and fees) and other compensation contemplated by
this Agreement and the other Loan Documents payable to the Term Loan Lenders
through the Term Loan Funding Date, to the extent invoices and statements have
been received, shall have been paid.


 


(b)                                 Evidence
delivered simultaneously with the funding of the Term Loans that (i) the Term
Loan B Existing Indebtedness has been prepaid and (ii) the Liens evidencing
such Debt shall have been released.  The
US Administrative Agent shall have received a copy of the notice of redemption
with respect to the Term Loan B Existing Indebtedness.


 


(c)                                  The
Term Notes duly completed and executed.


 


(d)                                 Except
as set forth on Schedule 6.01(q), as updated, the stock of UCI and all
such other property in which the US Administrative Agent shall, at such time,
be entitled to have a Lien pursuant to this Agreement or any other Security
Document shall have been physically delivered to the possession of the US
Administrative Agent or any bailee accepted by the US Administrative Agent to
the extent that such possession is necessary for the purpose of perfecting the
US Administrative Agent’s Lien in such Collateral.


 


(e)                                  Each
document (including any Uniform Commercial Code financing statement) required
by the Security Instruments then in effect or under law or reasonably requested
by the US Administrative Agent to be filed, registered or recorded in order to
create in favor of the US


 


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Administrative Agent, for the
benefit of the Lenders, a perfected Lien on the Collateral described therein,
prior and superior in right to any other Person (other than Permitted Liens),
all of which shall be in proper form for filing, registration or recordation.


 


(f)                                    Such
other documents as the US Administrative Agent or any Lender or special counsel
to the US Administrative Agent may reasonably request.


 


(g)                                 An
executed mortgage on all real property related to the US Borrowers’ chief
executive offices at 4444 Brittmoore Road, Houston, Texas 77041 in which the US
Administrative Agent shall be entitled to have a Lien pursuant to this
Agreement or any other Security Instrument.


 


Section 6.05                                No
Waiver.  No waiver of any condition
precedent shall preclude the US Administrative Agent or the Lenders from
requiring such condition to be met prior to making any subsequent Revolving
Loan or preclude the Lenders from thereafter declaring that the failure of such
Borrower to satisfy such condition precedent constitutes a Default.


 


Section 6.06                                Canadian
Tranche Borrowings.  The obligation
of the Lenders to make the initial Canadian Tranche Loan to the Canadian
Borrower under this Agreement is subject to the receipt by the Applicable
Administrative Agent of the following documents:


 


(a)                                  Twenty
(20) Drafts and BA Equivalent Notes duly executed and endorsed in blank by the
Canadian Borrower for the account of each Canadian Tranche Revolving Lender in
form and substance as each Canadian Tranche Revolving Lender may reasonably
request.


 


(b)                                 An
opinion of Cox Hanson O’Reilly Matheson, Nova Scotia, counsel to the Canadian
Borrower, in form and substance reasonably satisfactory to the US
Administrative Agent, as to such matters incident to the transactions herein
contemplated and as the US Administrative Agent may reasonably request.


 


ARTICLE VII

Representations and Warranties of US Borrowers


 


Each US Borrower represents and warrants with respect
to itself, as applicable, to each of the Administrative Agents and the Lenders
(each representation and warranty herein is given as of the Closing Date and
shall be deemed repeated and reaffirmed on the dates of each Borrowing and
issuance, renewal, extension or reissuance of a Letter of Credit as provided in
Section 6.02):


 


Section 7.01                                Legal
Existence.  With respect to itself
and each of its Material Subsidiaries: 
(a) is a legal entity duly organized, legally existing and in good
standing (if applicable) under the laws of the jurisdiction of its formation,
except as permitted by Section 9.03; (b) has all requisite power, and
has all material governmental licenses, authorizations, consents and approvals
necessary to own its assets and carry on its business as now being or as
proposed to be conducted; and (c) is qualified to do business in all
jurisdictions in which the nature of the business conducted by it makes such
qualification necessary and where failure so to qualify would result in a Material
Adverse Effect.


 


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Section 7.02                                Financial
Condition.  With respect to Holdings,
the audited consolidated balance sheet of Holdings and its Consolidated
Subsidiaries as at March 31, 2004 and the related consolidated statement of
income, stockholders’ equity and cash flow of Holdings and its Consolidated
Subsidiaries for the fiscal year ended on said date, with the opinion thereon
of Deloitte Touche heretofore furnished to each of the Lenders and the unaudited
consolidated balance sheet of Holdings and its Consolidated Subsidiaries as at
September 30, 2004 and their related consolidated statements of
income, stockholders’ equity and cash flow of Holdings and its Consolidated
Subsidiaries for the six (6) month period ended on such date heretofore
furnished to the US Administrative Agent, are complete and correct and fairly
present the consolidated financial condition of Holdings and its Consolidated
Subsidiaries as at said dates and the results of its operations for the fiscal
year and the six (6) month period on said dates in all material respects,
all in accordance with GAAP, as applied on a consistent basis (subject, in the
case of the interim financial statements, to normal year-end adjustments).  Neither Holdings nor any of its Subsidiaries
has on the Closing Date any material Debt, contingent liabilities, liabilities
for taxes, unusual forward or long-term commitments or unrealized or
anticipated losses from any unfavorable commitments, except as referred to or
reflected or provided for in the Financial Statements or in Schedule 7.02.  Since September 30, 2004, there has been no
change or event having a Material Adverse Effect.


 


Section 7.03                                Litigation.  Except as disclosed to the Lenders in Schedule 7.03
hereto, at the Closing Date there is no litigation, legal, administrative or
arbitral proceeding, investigation or other action of any nature pending or, to
its knowledge threatened against or affecting it or any of its Subsidiaries
which involves the possibility of any judgment or liability against it or any
of its Subsidiaries which would reasonably be expected to have a Material
Adverse Effect.


 


Section 7.04                                No
Breach.  Neither the execution and
delivery of the Loan Documents, nor compliance with the terms and provisions
hereof will conflict with or result in a breach of, or require any consent
which has not been obtained as of the Closing Date under, the respective
charter or by-laws of it or any of its Subsidiaries, or any Governmental
Requirement or any agreement or instrument to which it or any of its
Subsidiaries is a party or by which it is bound or to which it or its
Properties are subject, or constitute a default under any such agreement or
instrument, or result in the creation or imposition of any Lien upon any of the
revenues or assets of it or any of its Subsidiaries pursuant to the terms of
any such agreement or instrument other than the Liens created by the Loan
Documents.


 


Section 7.05                                Authority.  It and each of its Subsidiaries have all necessary
power and authority to execute, deliver and perform its obligations under the
Loan Documents to which it is a party; and the execution, delivery and
performance by it and each Subsidiary of the Loan Documents to which it is a
party, have been duly authorized by all necessary action on its part; and the
Loan Documents constitute the legal, valid and binding obligations of it and
each of its Subsidiaries, enforceable in accordance with their terms, except to
the extent that the enforceability thereof may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
generally affecting creditors’ rights and by equitable principles (regardless
of whether enforcement is sought in equity or at law).


 


Section 7.06                                Approvals.  No authorizations, approvals or consents of,
and no filings or registrations with, any Governmental Authority are necessary
for the execution, delivery or


 


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performance by it or any of its
Subsidiaries of the Loan Documents or for the validity or enforceability
thereof, except for the recording and filing of the Security Instruments as
required by this Agreement.


 


Section 7.07                                Use
of Loans.


 


(a)                                  Revolving
Loans.  The US Borrowers will use the
proceeds of the Revolving Loans for repayment of Revolving Existing
Indebtedness, working capital, letters of credit and other general corporate
purposes not in contravention of any Governmental Requirement or of any Loan
Document.


 


(b)                                 Term
Loans.  The US Borrowers will use the
proceeds of the Term Loans for repayment of the Term Loan B Existing
Indebtedness.


 


(c)                                  Margin
Stock.  No US Borrower is engaged
principally, or as one of its important activities, in the business of
extending credit for the purpose, whether immediate, incidental or ultimate, of
buying or carrying margin stock (within the meaning of Regulation T, U or
X of the Board of Governors of the Federal Reserve System) and no part of the
proceeds of any Loan hereunder will be used to buy or carry any margin stock.


 


Section 7.08                                ERISA.  No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events
for which liability is reasonably expected to occur, could reasonably be
expected to result in a Material Adverse Effect.  The present value of all accumulated benefit
obligations under each Plan (based on the assumptions used for purposes of
Statement of Financial Accounting Standards No. 87) did not, as of the date of
the most recent financial statements reflecting such amounts, exceed by more
than $100,000 the fair market value of the assets of such Plan, and the present
value of all accumulated benefit obligations of all underfunded Plans (based on
the assumptions used for purposes of Statement of Financial Accounting
Standards No. 87) did not, as of the date of the most recent financial
statements reflecting such amounts, exceed by more than $100,000 the fair
market value of the assets of all such underfunded Plans.


 


Section 7.09                                Taxes.  Except as set out in Schedule 7.09,
it and its Domestic Subsidiaries have filed all United States Federal income
tax returns and all other tax returns which are required to be filed by them
and have paid all taxes due pursuant to such returns or pursuant to any assessment
received by it or any of its Domestic Subsidiaries, except where the failure to
file such tax returns and pay such taxes would not result in a liability in
excess of $5,000,000 in the aggregate. 
The charges, accruals and reserves on the books of it and its
Subsidiaries in respect of taxes and other governmental charges are, in the
opinion of the US Borrowers, adequate. 
No tax lien has been filed and, to the knowledge of the US Borrowers, no
claim is being asserted with respect to any such tax, fee or other charge which
would result in a liability in excess of $5,000,000 in the aggregate.


 


Section 7.10                                Titles,
Etc.


 


(a)                                  Except
as set out in Schedule 7.10, it and its Subsidiaries have good and
marketable title to their material Properties, (i) except in cases where
the failure to have said


 


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good and marketable title would
not result in a Material Adverse Effect and (ii) free and clear of all
Liens, except Liens permitted by Section 10.02.


 


(b)                                 All
leases and agreements necessary for the conduct of the business of it and its
Subsidiaries are valid and subsisting, in full force and effect and there
exists no default or event or circumstance which with the giving of notice or
the passage of time or both would give rise to a default under any such lease
or agreement and which default, event or circumstance would result in a
Material Adverse Effect.


 


Section 7.11                                No
Material Misstatements.  No written
information, statement, exhibit, certificate, document or report furnished to
the Administrative Agents and the Lenders (or any of them) by it or any of its
Subsidiaries in connection with the negotiation of this Agreement, including
the Offering Memorandum, or delivered hereunder (as modified or supplemented by
other information so furnished) contains any material misstatement of fact or
omits to state a material fact necessary to make the statements contained
therein not materially misleading in the light of the circumstances in which
made and with respect to it and its Subsidiaries taken as a whole.  To each US Borrower’s knowledge, there is no
fact peculiar to it or any of its Subsidiaries which has a Material Adverse
Effect and which has not been set forth in this Agreement or the other
documents, certificates and statements furnished to the Administrative Agents
by or on behalf of it or any of its Subsidiaries or otherwise prior to, or on,
the Closing Date in connection with the transactions contemplated hereby.


 


Section 7.12                                Investment
Company Act.  Neither it nor any of
its Subsidiaries is an “investment company” or a company “controlled” by an “investment
company,” within the meaning of the Investment Company Act of 1940, as amended.


 


Section 7.13                                Public
Utility Holding Company Act.  Neither
it nor any of its Subsidiaries is a “holding company,” or a “subsidiary company”
of a “holding company,” or an “affiliate” of a “holding company” or of a “subsidiary
company” of a “holding company,” or a “public utility” within the meaning of
the Public Utility Holding Company Act of 1935, as amended.


 


Section 7.14                                Subsidiaries.  Except as set forth on Schedule 7.14,
as of the Closing Date, it has no Subsidiaries.


 


Section 7.15                                Location
of Business and Offices.  Each US
Borrower’s principal place of business and chief executive office is located at
the addresses stated on the signature page of this Agreement.


 


Section 7.16                                Defaults.  Neither it nor any of its Subsidiaries is in
material default nor has any event or circumstance occurred which, but for the
expiration of any applicable grace period or the giving of notice, or both,
would constitute a material default under any material agreement or instrument
to which it or any of its Subsidiaries is a party or by which it or any of its
Subsidiaries is bound, which default would result in a Material Adverse
Effect.  No Default hereunder has
occurred and is continuing.


 


Section 7.17                                Environmental
Matters.  Except (a) as provided
in Schedule 7.17 or (b) as would not have a Material Adverse
Effect:


 


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(i)            Neither
any Property of it or any of its Subsidiaries nor the operations conducted
thereon violate any order or requirement of any court or Governmental Authority
or any Environmental Laws;


 


(ii)           Without
limitation of clause (i) above, no Property of it or any of its
Subsidiaries nor the operations currently conducted thereon or, to the best
knowledge of it, by any prior owner or operator of such Property or operation,
are in violation of or subject to any existing, pending or threatened action,
suit, investigation, inquiry or proceeding by or before any court or
Governmental Authority or to any remedial obligations under Environmental Laws;


 


(iii)          All
notices, permits, licenses or similar authorizations, if any, required to be
obtained or filed in connection with the operation or use of any and all
Property of it and each of its Subsidiaries, including without limitation past
or present treatment, storage, disposal or release of a hazardous substance or
solid waste into the environment, have been duly obtained or filed, and it and
each of its Subsidiaries are in compliance with the terms and conditions of all
such notices, permits, licenses and similar authorizations;


 


(iv)          All
hazardous substances, solid waste, and oil and gas exploration and production wastes,
if any, generated at any and all Property of it or any of its Subsidiaries have
in the past been transported, treated and disposed of in accordance with
Environmental Laws and so as not to pose an imminent and substantial
endangerment to public health or welfare or the environment, and, to the best
knowledge of it, all such transport carriers and treatment and disposal
facilities have been and are operating in compliance with Environmental Laws
and so as not to pose an imminent and substantial endangerment to public health
or welfare or the environment, and are not the subject of any existing, pending
or threatened action, investigation or inquiry by any Governmental Authority in
connection with any Environmental Laws;


 


(v)           It
has taken all steps reasonably necessary to determine and has determined that
no hazardous substances, solid waste, or oil and gas exploration and production
wastes, have been disposed of or otherwise released and there has been no
threatened release of any hazardous substances on or to any Property of it or
any of its Subsidiaries except in compliance with Environmental Laws and so as
not to pose an imminent and substantial endangerment to public health or
welfare or the environment;


 


(vi)          To
the extent applicable, all Property of it and each of its Subsidiaries
currently satisfies all design, operation, and equipment requirements imposed
by the OPA or scheduled as of the Closing Date to be imposed by OPA during the
term of this Agreement, and it does not have any reason to believe that such
Property, to the extent subject to OPA, will not be able to maintain compliance
with the OPA requirements during the term of this Agreement; and


 


(vii)         Neither
it nor any of its Subsidiaries has any known contingent liability in connection
with any release or threatened release of any oil, hazardous substance or solid
waste into the environment.


 


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Section 7.18                                Compliance with the
Law.  Neither it nor any of its
Subsidiaries has violated any Governmental Requirement or failed to obtain any
license, permit, franchise or other governmental authorization necessary for
the ownership of any of its Properties or the conduct of its business, which
violation or failure would (in the event such violation or failure were
asserted by any Person through appropriate action) result in a Material Adverse
Effect.


 


Section 7.19                                Insurance.  Schedule 7.19 attached hereto
contains an accurate description of all material policies of fire, liability,
workmen’s compensation and other forms of insurance owned or held by it and
each Material Subsidiary and Material Foreign Subsidiary.  All such policies are in full force and
effect, all premiums with respect thereto covering all periods up to and
including the Closing Date have been paid, and no notice of cancellation or
termination has been received with respect to any such policy.  Such policies are sufficient for compliance
with all requirements of law and of all agreements to which it or any Material
Subsidiary is a party; are valid, outstanding and enforceable policies; provide
adequate insurance coverage in at least such amounts and against at least such
risks (but including in any event public liability) as are usually insured
against in the same general area by companies engaged in the same or a similar
business for the assets and operations of it and each Subsidiary; will remain
in full force and effect through the respective dates set forth in the binders
for said insurance without the payment of additional premiums; and will not in
any way be affected by, or terminate or lapse by reason of, the transactions
contemplated by this Agreement.  Neither
it nor any Material Subsidiary has been refused any insurance with respect to
its assets or operations, nor has its coverage been limited below usual and
customary policy limits, by an insurance carrier to which it has applied for
any such insurance or with which it has carried insurance during the last three
years.


 


Section 7.20                                Hedging Agreements.  Schedule 7.20 sets forth, as of
the Closing Date, a true and complete list of all Hedging Agreements (including
commodity price swap agreements, forward agreements or contracts of sale which
provide for prepayment for deferred shipment or delivery of oil, gas or other
commodities) of it and each of its Subsidiaries or issued pursuant to the ABS
Facility, the material terms thereof (including the type, term, effective date,
termination date and notional amounts or volumes), the net mark to market value
thereof, all credit support agreements relating thereto (including any margin
required or supplied), and the counter party to each such agreement.


 


Section 7.21                                Restriction on Liens.  Except as set forth on Schedule 7.21,
neither it nor any of its Subsidiaries is a party to any agreement or
arrangement (other than this Agreement and the Security Instruments), or
subject to any order, judgment, writ or decree, which either restricts or
purports to restrict its ability to grant Liens pursuant to this Agreement and
the Security Instruments to other Persons on or in respect of its material
Properties.


 


ARTICLE VIII

Representations and Warranties of Canadian Borrower


 


The Canadian Borrower represents and warrants to each
of the Administrative Agents and the Lenders (each representation and warranty
herein is given as of the Closing Date and shall be deemed repeated and
reaffirmed on the dates of each Borrowing as provided in Section 6.02)
with respect to the Canadian Tranche:


 


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Section 8.01                                Legal Existence.  The Canadian Borrower:  (a) is a legal entity duly organized, legally
existing and in good standing (if applicable) under the laws of the
jurisdiction of its formation; (b) has all requisite power, and has all
material governmental licenses, authorizations, consents and approvals
necessary to own its assets and carry on its business as now being or as
proposed to be conducted; and (c) is qualified to do business in all
jurisdictions in which the nature of the business conducted by it makes such
qualification necessary and where failure so to qualify would result in a
Material Adverse Effect.


 


Section 8.02                                No Breach.  Neither the execution and delivery of the
Loan Documents nor compliance with the terms and provisions hereof will conflict
with or result in a breach of, or require any consent which has not been
obtained as of the Closing Date under, the Memorandum of Association or
Articles of Association of the Canadian Borrower, or any Governmental
Requirement or any agreement or instrument to which the Canadian Borrower is a
party or by which it is bound or to which it or its Properties are subject, or
constitute a default under any such agreement or instrument, or result in the
creation or imposition of any Lien upon any of the revenues or assets of the
Canadian Borrower pursuant to the terms of any such agreement or instrument
other than the Liens created by the Loan Documents.


 


Section 8.03                                Authority.  The Canadian Borrower has all necessary power
and authority to execute, deliver and perform its obligations under the Loan
Documents to which it is a party; and the execution, delivery and performance
by the Canadian Borrower of the Loan Documents to which it is a party, have
been duly authorized by all necessary action on its part; and the Loan
Documents constitute the legal, valid and binding obligations of the Canadian
Borrower, enforceable in accordance with their terms, except to the extent that
the enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws generally affecting creditors’
rights and by equitable principles (regardless of whether enforcement is sought
in equity or at law).


 


Section 8.04                                Approvals.  No authorizations, approvals or consents of,
and no filings or registrations with, any Governmental Authority are necessary
for the execution, delivery or performance by the Canadian Borrower of the Loan
Documents or for the validity or enforceability thereof.


 


Section 8.05                                Defaults.  The Canadian Borrower is not in material
default nor has any event or circumstance occurred which, but for the
expiration of any applicable grace period or the giving of notice, or both,
would constitute a material default under any material agreement or instrument
to which the Canadian Borrower is a party or by which the Canadian Borrower is
bound, which default would result in a Material Adverse Effect.


 


Section 8.06                                Income Tax Act
(Canada).  The Canadian Borrower is
either not a non-resident of Canada for purposes of the Income Tax Act (Canada)
or is deemed a resident of Canada for purposes of Part XIII of the Income Tax
Act (Canada).


 


Section 8.07                                Use of Loans.  The Canadian Borrower will use the proceeds
of the Revolving Loans for working capital, letters of credit and other general
corporate purposes not in contravention of any Governmental Requirement or of
any Loan Document.


 


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ARTICLE IX

Affirmative Covenants


 


Holdings covenants and agrees that, so long as any of
the Aggregate Commitments are in effect and until payment in full of all Loans
hereunder, all interest thereon and all other amounts payable by the Borrowers
hereunder:


 


Section 9.01                                Reporting
Requirements.  The US Borrowers shall
deliver, or shall cause to be delivered, to the US Administrative Agent:


 


(a)                                  Financial
Statements.  (i) Within 30 days after
the same is required to be filed with the SEC or any successor agency (but in
any event within 90 days of the end of each fiscal year of Holdings), a copy of
each annual report and any amendment to a report filed with the SEC or any
successor agency pursuant to Section 13 or 15(d) of the Exchange Act (currently
Form 10-K), as the same may be amended from time to time, (ii) within 30 days
after the same is required to be filed with the SEC or any successor agency
(but in any event within 60 days after the end of each of the first three
fiscal quarters of Holdings), a copy of each quarterly report and any amendment
to any quarterly report filed with the SEC or any successor agency pursuant to
Section 13 or 15(d) of the Exchange Act (currently Form 10-Q), as the same may
be amended from time to time, and (iii) promptly after the same become
available, but in any event within 15 days following the date the same are
required to be filed with the SEC, all other reports, notices, proxy statements
or other documents that are distributed by Holdings to its shareholders and all
regular and periodic final reports (including, without limitation, reports on
Form 8-K) filed by Holdings with the SEC, which are publicly available;
provided, however, that the US Borrowers shall be deemed to have furnished the
information required by this Section 9.01(a) if Holdings shall have
timely made the same available on “EDGAR” and/or on its home page on the
worldwide web (at the date of this Agreement located at http://www.universalcompression.com);
provided, further, however, that if the US Administrative Agent is
unable to access EDGAR or Holdings’ home page on the worldwide web, the US
Borrowers agree to provide the US Administrative Agent with paper copies of the
information required to be furnished pursuant to this Section 9.01(a)
promptly following notice from the US Administrative Agent.  Information required to be delivered pursuant
to this Section 9.01(a) shall be deemed to have been delivered on the
date on which the US Borrowers provide notice to the US Administrative Agent
that such information has been posted on “EDGAR” or Holdings’ website or
another website identified in such notice and accessible by the US
Administrative Agent without charge (and the US Borrowers hereby agrees to
provide such notice).


 


(b)                                 Budget, Projections.  Commencing on June 30, 2005, as soon as
available and in any event within 90 days following the end of each fiscal year
of Holdings, a copy of the projections of the operating budget and cash flow
budget of Holdings and its Subsidiaries prepared on a consolidated basis for
the succeeding fiscal year, such projections to be accompanied by a certificate
of a Responsible Officer to the effect that such projections have been prepared
on the basis of reasonable assumptions and that such Responsible Officer has no
reason to believe they are incorrect or misleading in any material respect.


 


(c)                                  Notice of Default,
Etc.  Promptly after either US
Borrower knows that any Default or Material Adverse Effect has occurred, a
notice of such Default or Material Adverse Effect, describing the same in
reasonable detail and the action such US Borrower proposes to


 


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take with respect thereto, and
at the US Administrative Agent’s option, a copy of the notice of such Default
or Material Adverse Effect.


 


(d)                                 Management Letters.  Promptly after it or any Material Subsidiary’s
receipt thereof, a copy of any “management letter” addressed to the board of
directors of it or such Material Subsidiary from its certified public
accountants and any internal control memoranda relating thereto.


 


(e)                                  Other Matters.  From time to time such other information regarding
the business, affairs or financial condition of it or any Material Subsidiary
(including, without limitation, any Plan or Multiemployer Plan and any reports
or other information required to be filed under ERISA) as the US Administrative
Agent may reasonably request.


 


(f)                                    Rating Change.  Promptly after Moody’s or S&P shall have
announced a change in the rating established or deemed to have been established
for the Revolving Credit Facility and the Term Loan B Facility, a notice of
such change describing the same in detail.


 


(g)                                 Labor Disputes.  Promptly upon becoming aware of any labor
dispute which would result in a Material Adverse Effect, a notice of such
dispute describing same in detail and the action such US Borrower proposes to
take with respect thereto.


 


(h)                                 Compliance
Certificate.  The US Borrowers, at
the time of any deemed delivery of any annual report or quarterly report
pursuant to paragraph (a) above, will furnish to the US Administrative
Agent (i) a certificate substantially in the form of Exhibit C-2
executed by a Responsible Officer of one of the US Borrowers
(A) certifying as to the matters set forth therein and stating that no
Default has occurred and is continuing (or, if any Default has occurred and is
continuing, describing the same in reasonable detail) and (B) setting
forth in reasonable detail the computations necessary to determine whether the
US Borrowers are in compliance with Section 10.13(a), (b)
and (c) as of the end of the respective fiscal quarter or fiscal year;
and (ii) a report, in form and substance satisfactory to the US Administrative
Agent, setting forth as of such Quarterly Date a true and complete list of all
Hedging Agreements (including commodity price swap agreements, forward
agreements or contracts of sale which provide for prepayment for deferred
shipment or delivery of oil, gas or other commodities) of it, each of its
Subsidiaries or pursuant to the ABS Facility, the material terms thereof
(including the type, term, effective date, termination date and notional
amounts or volumes), the net mark to market value therefor, any new credit
support agreements relating thereto not listed on Schedule 7.20,
any margin required or supplied under any credit support document, and the
counter party to each such agreement.


 


Section 9.02                                Litigation.  It shall promptly give to the US
Administrative Agent notice of any litigation or governmental investigation or
proceeding pending against it or any of its Subsidiaries which would result in
a Material Adverse Effect.


 


Section 9.03                                Maintenance, Etc.


 


(a)                                  Generally.  Except as otherwise permitted by Section
10.08, it shall and shall cause each Material Subsidiary to:  preserve and maintain its legal entity
existence and all of its material rights, privileges, franchises, patents, trademarks,
copyrights and licenses; keep books


 


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of record and account in which
full, true and correct entries will be made of all dealings or transactions in
relation to its business and activities; comply with all Governmental
Requirements if failure to comply with such requirements will have a Material
Adverse Effect; pay and discharge all taxes, assessments and governmental
charges or levies imposed on it or on its income or profits or on any of its Property
prior to the date on which penalties attach thereto, except for any such tax,
assessment, charge or levy the payment of which is being contested in good
faith and by proper proceedings and against which adequate reserves are being
maintained; upon reasonable notice, permit representatives of the
Administrative Agents, during normal business hours, to examine, copy and make
extracts from its books and records, to inspect its Properties, and to discuss
its business and affairs with its officers, all to the extent reasonably
requested by such Administrative Agent.


 


(b)                                 Proof of Insurance.  It shall and shall cause each Material
Subsidiary to maintain, with financially sound and reputable insurance
companies, insurance policies which (i) are sufficient for compliance with all
requirements of law and of all agreements to which it or any Material
Subsidiary is a party; (ii) are valid, outstanding and enforceable policies;
and (iii) provide adequate insurance coverage in at least such amounts and
against at least such risks (but including in any event public liability) as
are usually insured against in the same general area by companies engaged in
the same or a similar business for the assets and operations of it and each
Material Subsidiary.  Within 90 days of
the end of each fiscal year, the US Borrower will furnish or cause to be
furnished to the US Administrative Agent a certificate of insurance coverage
from the insurer in form and substance satisfactory to the US Administrative
Agent and, if requested, will furnish the US Administrative Agent copies of the
applicable policies.


 


(c)                                  Operation of
Properties.  It will and will cause
each of its Subsidiaries to operate its Properties or cause such Properties to
be operated in a careful and efficient manner (i) in compliance with the
practices of the industry, (ii) in compliance with all applicable contracts and
agreements and (iii) in compliance in all material respects with all
Governmental Requirements, except where the noncompliance therewith would not
result in a Material Adverse Effect.


 


Section 9.04                                Environmental
Matters.


 


(a)                                  Establishment of
Procedures.  It will and will cause
each of its Subsidiaries to establish and implement such procedures as may be
reasonably necessary to continuously determine and assure that any failure of
the following does not have a Material Adverse Effect:  (i) all Property of it and its
Subsidiaries and the operations conducted thereon and other activities of it
and its Subsidiaries are in compliance with and do not violate the requirements
of any Environmental Laws, (ii) no oil, hazardous substances or solid wastes
are disposed of or otherwise released on or to any Property owned by any such
party except in compliance with Environmental Laws, (iii) no hazardous
substance will be released on or to any such Property in a quantity equal to or
exceeding that quantity which requires reporting pursuant to Section 103
of CERCLA, and (iv) no oil, oil and gas exploration and production wastes
or hazardous substance is released on or to any such Property so as to pose an
imminent and substantial endangerment to public health or welfare or the
environment.


 


(b)                                 Notice of Action.  The US Borrowers will promptly notify the US
Administrative Agent in writing of any threatened action, investigation or
inquiry by any Governmental


 


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Authority of which such US
Borrower has knowledge in connection with any Environmental Laws, which would
result in a Material Adverse Effect.


 


Section 9.05                                Further Assurances.  It will and will cause each of its
Subsidiaries to cure promptly any defects in the creation and issuance of the
Notes and the execution and delivery of the Security Instruments and this
Agreement.  It at its expense will and
will cause each of its Subsidiaries to promptly execute and deliver to the
Applicable Administrative Agent upon request all such other documents,
agreements and instruments to comply with or accomplish the covenants and
agreements of it or any of its Subsidiaries, as the case may be, in the
Security Instruments and this Agreement, or to further evidence and more fully
describe the collateral intended as security for the Notes, or to correct any
omissions in the Security Instruments, or to state more fully the security
obligations set out herein or in any of the Security Instruments, or to
perfect, protect or preserve any Liens created pursuant to any of the Security
Instruments, or to make any recordings, to file any notices or obtain any
consents, all as may be reasonably necessary or appropriate in connection
therewith.


 


Section 9.06                                Performance of
Obligations.  The Borrowers will pay
their Notes according to the reading, tenor and effect thereof; and it will and
will cause each of its Subsidiaries to do and perform every act and discharge
all of the obligations to be performed and discharged by them under the
Security Instruments and this Agreement, at the time or times and in the manner
specified.


 


Section 9.07                                Reserved.


 


Section 9.08                                Reserved.


 


Section 9.09                                Collateral.


 


(a)                                  Guarantees and
Collateral.  It shall and it shall
cause each Subsidiary Guarantor to grant a Lien pursuant to the Security
Instruments on substantially all of its following described Properties now
owned or at any time hereafter acquired by it or a Subsidiary Guarantor located
in the United States: all Equipment, Accounts, Chattel Paper, Documents,
General Intangibles, Instruments, Inventory, the real property related to the
US Borrowers’ chief executive offices located at 4444 Brittmoore Road, Houston,
Texas 77041; provided that it and any Subsidiary Guarantor will have
ninety (90) days to perfect Liens on Property acquired in an acquisition.  It shall promptly cause each Significant
Domestic Subsidiary now existing or hereafter formed to guarantee the Indebtedness
pursuant to the execution and delivery of the Guarantee and Collateral
Agreement or a supplement thereto.  UCI
will guarantee the Indebtedness pursuant to the execution and delivery of the
Guarantee and Collateral Agreement or a supplement thereto on or before the
date that Holdings becomes the sole Borrower pursuant to Section 2.14.  Holdings shall cause to be pledged by the
appropriate Person all of the capital stock of each Domestic Subsidiary
(excluding any Subsidiary involved in the ABS Facility), and 65% of the capital
stock of each first tier Foreign Subsidiary (including, without limitation, to
the extent certificated, delivery of original stock certificates or other
certificates evidencing the capital stock of such Domestic Subsidiary or 65% of
the capital stock of such Foreign Subsidiary, together with an appropriate
undated stock power for each certificate duly executed in blank by the
registered owner thereof) and execute and deliver such other additional
documents and certificates as shall reasonably be requested by the US
Administrative Agent.  Notwithstanding
the foregoing to the


 


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contrary, the UCI stock will be
pledged and the real property required pursuant to this Section 9.09(a)
shall be secured by a Lien on the Term Loan Funding Date.


 


(b)                                 Releases.  The US Borrowers and the Subsidiary
Guarantors are authorized to release any Collateral that is sold, leased,
assigned, conveyed, transferred or otherwise disposed of in compliance with Sections
10.08, 10.11 and 10.14.


 


Section 9.10                                Notice of an ERISA
Event.  It will promptly furnish to
the US Administrative Agent written notice of the occurrence of any ERISA Event
that, alone or together with any other ERISA Events that have occurred, could
reasonably be expected to result in liability of it and its Subsidiaries in an
aggregate amount exceeding $100,000.


 


Section 9.11                                Compression
Collateral Appraisals.


 


(a)                                  In addition to the
initial Appraisal required under Section 6.01, it will provide or will
cause to be provided to the US Administrative Agent an Appraisal on the second
anniversary of this Agreement and each subsequent 2-year anniversary thereafter
on the then current fleet of Compression Collateral.


 


(b)                                 It will provide or
will cause to be provided to the US Administrative Agent an update to the most
recent Appraisal, in form and scope reasonably satisfactory to the US
Administrative Agent, on the first anniversary of this Agreement and each
subsequent 2-year anniversary thereafter.


 


ARTICLE X

Negative Covenants


 


Holdings covenants and agrees that, so long as any of
the Aggregate Revolving Commitments and Aggregate Term Commitments are in
effect and until payment in full of Loans hereunder, all interest thereon and
all other amounts payable by the Borrowers hereunder, without the prior written
consent of the Majority Lenders:


 


Section 10.01                          Debt.  Neither it nor any of its Subsidiaries will
incur, create, assume or permit to exist any Debt, except:


 


(a)                                  the Notes, the BA
Equivalent Notes, the Bankers’ Acceptances or other Indebtedness or any
guaranty of or suretyship arrangement for the Notes, the BA Equivalent Notes,
the Bankers’ Acceptances or other Indebtedness;


 


(b)                                 Debt (including
unfunded commitments) of it or its Subsidiaries existing on the Closing Date
which is reflected in the Financial Statements or is disclosed in Schedule 10.01,
and any renewals, extensions, refinancings and modifications (but not
increases) thereof;


 


(c)                                  accounts payable (for
the deferred purchase price of Property or services) from time to time incurred
in the ordinary course of business which, if greater than 90 days past the
invoice or billing date, are being contested in good faith by appropriate
proceedings if reserves adequate under GAAP shall have been established
therefor;


 


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(d)                                 Debt of it and its
Subsidiaries under Hedging Agreements which are for bona fide business purposes
and are not speculative;


 


(e)                                  Any extensions or
increases of the ABS Facility, not to exceed an additional $200,000,000 (or
$400,000,000 in the aggregate) and any refinancing or replacement thereof; provided
that no US Borrower or any Domestic Subsidiary is liable for such Debt.


 


(f)                                    other Debt of it
and the Domestic Subsidiaries incurred, not to exceed $125,000,000 in the aggregate;


 


(g)                                 Debt evidenced by
Capital Lease Obligations and Purchase Money Indebtedness; provided that
in no event shall the aggregate principal amount of Capital Lease Obligations
and Purchase Money Indebtedness permitted by this clause (g) exceed
$30,000,000 at any time outstanding;


 


(h)                                 Debt with respect to
surety bonds, appeal bonds or customs bonds required in the ordinary course of
business or in connection with the enforcement of rights or claims of Holdings
or any of its Subsidiaries or in connection with judgments that do not result
in a Default or an Event of Default, provided that the aggregate
outstanding amount of all cash surety bonds, appeal bonds and custom bonds
permitted by this clause (h) shall not at any time exceed $15,000,000;


 


(i)                                     Debt of any
Foreign Subsidiary used for such Foreign Subsidiary’s and/or its Foreign
Subsidiaries’ working capital and general business purposes; provided
that no US Borrower nor any Domestic Subsidiary is liable for such Foreign
Subsidiary Debt in excess of $50,000,000 outstanding in the aggregate;


 


(j)                                     Debt for borrowed
money assumed by Holdings or one of its Subsidiaries, or of a Subsidiary of
Holdings acquired, pursuant to an acquisition or merger permitted pursuant to
the terms of this Agreement, provided that such Debt shall not exceed
$150,000,000 in the aggregate at any time and such Debt was not incurred in
connection with, or in anticipation or contemplation of such permitted
acquisition or merger; and provided further that the aggregate amount of
Debt permitted pursuant to this clause (j) that has a scheduled maturity
date that is earlier than the later to occur of the scheduled Revolving Credit
Maturity Date or Term Loan Maturity Date shall not exceed $50,000,000; and


 


(k)                                  Permitted Acquisition
Debt.


 


Section 10.02                          Liens.  Neither it nor any of its Subsidiaries will
create, incur, assume or permit to exist any Lien on any of its Properties (now
owned or hereafter acquired), except (herein referred to as “Permitted Liens”):


 


(a)                                  Liens arising under
the Security Instruments securing the payment of any Indebtedness;


 


(b)                                 Liens disclosed on Schedule 10.02;


 


(c)                                  Excepted Liens;


 


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(d)                                 Liens on Property held
or pledged in connection with the ABS Facility, provided that such Liens
do not extend to or cover any Property of Holdings or any of its Subsidiaries
other than the Property of Subsidiaries involved in the ABS Facility;


 


(e)                                  Liens securing
acquired Debt permitted under Section 10.01(j); provided,
that the aggregate amount of Debt secured by such Liens shall not exceed
$75,000,000 and do not extend to or cover any Property other than the Property
that secured such Debt prior to the time it was acquired or assumed;


 


(f)                                    Liens relating to
Debt permitted under Sections 10.01(f),  (j) or (k), provided
that the aggregate amount of Debt secured by such Liens shall not exceed
$25,000,000; provided  further that such Liens permitted under Section
10.01(j) do not extend to or cover any Property other than the Property
that secured such Debt prior to the time it was acquired or assumed and this
shall be in addition to the Liens permitted by Section 10.02(e);


 


(g)                                 Liens securing Capital
Lease Obligations and Purchase Money Indebtedness allowed under Section 10.01(g),
but only on the Property under lease or purchased; and


 


(h)                                 Liens on assets of
Foreign Subsidiaries under Foreign Credit Facilities.


 


Section 10.03                          Investments.  Neither it nor any of its Subsidiaries will
make any Investments in any Person, except that, so long as no Event of Default
has occurred and is continuing, the foregoing restriction shall not apply to:


 


(a)                                  Investments reflected
in the Financial Statements or which are disclosed to the Lenders in Schedule 10.03;


 


(b)                                 accounts receivable
arising in the ordinary course of business;


 


(c)                                  direct obligations of
the United States or Canada or any agency thereof, or obligations guaranteed by
the United States or Canada or any agency thereof, in each case maturing within
one year from the date of creation thereof;


 


(d)                                 commercial paper
maturing within one year from the date of creation thereof rated no lower than
A2 or P2 as such rating is set forth by S&P or Moody’s, respectively;


 


(e)                                  deposits maturing
within one year from the date of creation thereof with, including certificates
of deposit issued by, any Lender or any office located in the United States or
Canada of any other bank or trust company which is organized under the laws of
the United States or any state thereof, has capital, surplus and undivided
profits aggregating at least $100,000,000.00 (as of the date of such Lender’s
or bank or trust company’s most recent financial reports) and has a short term
deposit rating of no lower than A2 or P2, as such rating is set forth from time
to time, by S&P or Moody’s, respectively;


 


(f)                                    deposits in money
market funds which invest 95% or more of its funds in Investments described in Section 10.03(c),
10.03(d) or 10.03(e);


 


(g)                                 Permitted Acquisition
Category 1 not to exceed $200,000,000 in any one fiscal year or $300,000,000 in
the aggregate at any time outstanding;


 


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(h)                                 Permitted Acquisition
Category 2; provided,  however, at the time of the completion of
any Permitted Acquisition Category 2, all previous Permitted Acquisition
Category 1 shall be deemed to be Permitted Acquisition Category 2 and the
limitations of the amount of Permitted Acquisition Category 1 and corresponding
Permitted Acquisition Debt shall be reset.  In other words, the amount of Permitted
Acquisition Category 1 and related outstanding Debt shall be deemed to be
reduced to zero as of such date;


 


(i)                                     payroll advances
and employee loans up to $5,000,000;


 


(j)                                     Investments by it
or by any of its Subsidiaries in any other Subsidiary;


 


(k)                                  Investments otherwise
permitted by Sections 10.01 or 10.14; and


 


(l)                                     other Investments
not to exceed $25,000,000 in the aggregate.


 


Section 10.04                          Dividends, Distributions
and Redemptions.  Holdings will not
declare or pay any dividend, purchase, redeem or otherwise acquire for value
any of its stock now or hereafter outstanding, return any capital to its
stockholders or make any distribution of their assets to its stockholders;
except that so long as there shall exist no Default or Event of Default (both
before and after giving effect to the payment thereof), (a)  Holdings may
purchase shares of common stock or options to purchase shares of common stock
of Holdings held by former employees of UCI or any of its Subsidiaries following
the termination of their employment by UCI or any of its Subsidiaries, provided
that the aggregate amount of cash dividends paid pursuant to this Section 10.04(a)
shall not during any fiscal year of Holdings exceed $10,000,000;
(b) Holdings may make other distributions, purchases or redemptions, provided
that the aggregate amount of such distributions paid pursuant to this Section
10.04(b) shall not exceed $15,000,000 during
any fiscal year; and (c) Holdings may purchase common stock of Holdings held by
Weatherford International Ltd. not to exceed (i) $100,000,000 in the aggregate
during the term of this Agreement if the Total Leverage Ratio is less than 3.5
to 1.0 for the most recent Testing Period at the time of such purchase and (ii)
$35,000,000 in the aggregate during the term of this Agreement if the Total
Leverage Ratio is equal to or more than 3.5 to 1.0 for the most recent Testing
Period at the time of such purchase.  For
purposes of this Section 10.04, the Total Leverage Ratio shall include any
Debt incurred to make such purchase.


 


Section 10.05                          Reserved


 


Section 10.06                          Nature of Business.  Neither it nor any Material Subsidiary will
allow any material change to be made in the character of its business.


 


Section 10.07                          Reserved.


 


Section 10.08                          Mergers, Etc.  Neither it nor any of its Subsidiaries will
merge into or with or consolidate with any other Person, or sell, lease or
otherwise dispose of (whether in one transaction or in a series of
transactions) all or substantially all of its Property or stock of any of its
Subsidiaries to any other Person except that (a) any Subsidiary of it may
be merged into or consolidated with or sell, lease or otherwise dispose of all
or substantially all of its Property to (i) a US Borrower, so long as a US
Borrower is the surviving business entity, or (ii) another Subsidiary of
it, (b) it or UCI, as applicable may merge into or consolidate with any
Person


 


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provided, in each case
(i) immediately thereafter and giving effect thereto, no event shall occur
and be continuing which constitutes a Default or Event of Default and
(ii) it or UCI, as applicable is the surviving business entity and (c) any
Subsidiary of it may liquidate, dissolve or sell so long as it determines in
good faith that such liquidation, dissolution or sale is in the best interest
of it.


 


Section 10.09                          Proceeds of Notes; Letters
of Credit.  The Borrowers will not
permit the proceeds of the Notes, the Bankers’ Acceptances, the BA Equivalent
Notes or Letters of Credit to be used for any purpose other than those
permitted by Sections 7.07 or 8.07.  Neither US Borrower nor any Person acting on
behalf of either US Borrower has taken or will take any action which might
cause any of the Loan Documents to violate Regulation T, U or X or any
other regulation of the Board of Governors of the Federal Reserve System or to
violate Section 7 of the Exchange Act or any rule or regulation
thereunder, in each case as now in effect or as the same may hereinafter be in
effect.


 


Section 10.10                          Reserved.


 


Section 10.11                          Sale or Discount of
Receivables.  Neither it nor any of
its Subsidiaries will discount or sell (with or without recourse) any of its
notes receivable or accounts receivable, except in the ordinary course of business.


 


Section 10.12                          Fiscal Year Change.  It will not permit any change in its fiscal
year, except to synchronize its fiscal year with the calendar year.


 


Section 10.13                          Certain Financial
Covenants.


 


(a)                                  Total Debt to
EBITDA.  It will not permit its Total
Leverage Ratio as of the end of any Testing Period to be greater than 5.00 to
1.0.


 


(b)                                 Interest Coverage
Ratio.  It will not permit its
Interest Coverage Ratio as of the end of any Testing Period to be less than
2.50 to 1.00.


 


(c)                                  Collateral Ratio.  The US Borrowers will not permit the ratio of
(i) the Market Value of Compression Collateral to (ii) Aggregate Credit
Exposure to be less than 1.25 to 1.0 at any time.  As used herein, “Market Value” of the
Compression Collateral shall be determined by the most recent Appraisal or
update as required in Section 9.11; provided, however, in
the period between the effective date of Appraisals or updates, “Market Value”
will also include the cost of any newly added Compression Collateral during
such period and will not include the Market Value of any Property that is not
Compression Collateral.


 


Section 10.14                          Sale of Properties.  It will not, and will not permit any of its
Subsidiaries to, sell, assign, convey or otherwise transfer (excluding the
granting of a Lien) any Property to any Person other than to it or to any of
its Subsidiaries, except it and any of its Subsidiaries:


 


(a)                                  may sell or otherwise
dispose of any Property which, in the reasonable judgment of such Person, is
obsolete, worn out or otherwise no longer useful in the conduct of such Person’s
business;


 


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(b)                                 may sell or lease
inventory or equipment in the ordinary course of business;


 


(c)                                  may sell, lease,
assign, convey or otherwise transfer Property so that it may become collateral
for the ABS Facility, the 8 7/8% Notes or the Existing Tranche B Loan Facility,
in the ordinary course of business;


 


(d)                                 may sell, lease,
assign, convey or otherwise transfer Property so that it may become collateral
for extensions and increases of Debt permitted by Section 10.01(e); and


 


(e)                                  so long as no Event
of Default has occurred and is continuing, may sell or otherwise dispose of
Property having a value of up to 10% of the book value of the total tangible
assets of it on a consolidated basis in any fiscal year.


 


Section 10.15                          Environmental Matters.  Neither it nor any of its Subsidiaries will
cause or permit any of its Property to be in violation of, or do anything or
permit anything to be done which will subject any such Property to any remedial
obligations under any Environmental Laws, assuming disclosure to the applicable
Governmental Authority of all relevant facts, conditions and circumstances, if
any, pertaining to such Property where such violations or remedial obligations
would have a Material Adverse Effect.


 


Section 10.16                          Transactions with
Affiliates.  Except as set forth on Schedule
10.16, neither it nor any of its Subsidiaries will enter into any
transaction, including, without limitation, any purchase, sale, lease or
exchange of Property or the rendering of any service, with any Affiliate unless
such transactions are otherwise permitted under this Agreement, are in the
ordinary course of its business and are upon fair and reasonable terms no less
favorable to it than it would obtain in a comparable arm’s length transaction
with a Person not an Affiliate.


 


Section 10.17                          Subsidiaries.  It shall not, and shall not permit any of its
Subsidiaries to, create any additional Subsidiaries except for
(a) Subsidiaries resulting from future mergers or acquisitions permitted
hereunder, (b) new Subsidiaries created by it in compliance with Section 10.03
and (c) Subsidiaries created in connection with the reorganization of it or any
Subsidiary.  Upon the creation of any new
Subsidiaries, the capital stock (to the extent certificated) shall be pledged
as Collateral for this Agreement (subject to the 65% limitation for first-tier
Foreign Subsidiaries).


 


Section 10.18                          Negative Pledge Agreements.  Except as permitted by this Agreement,
neither it nor any of its Subsidiaries will create, incur, assume or permit to
exist any contract or agreement (other than this Agreement and the Security
Instruments) which in any way prohibits or restricts the granting, conveying,
creation or imposition of any Lien on any of its Property as may be required in
connection with this Agreement or restricts any of its Subsidiaries from paying
dividends to the US Borrowers, or which requires the consent of or notice to
other Persons in connection therewith, except for any such contract or
agreement existing as of the Closing Date and any extensions, renewals or
replacements of any contracts or agreements permitted hereunder; provided
that such prohibitive terms of such contract or agreement are no more restrictive
than the terms reflected in such contract or agreement existing as of the
Closing Date.


 


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ARTICLE XI

Events of Default; Remedies


 


Section 11.01                          Events of Default.  One or more of the following events which
continue beyond any applicable cure period shall constitute an “Event of
Default”:


 


(a)                                  any Borrower shall
default in the payment or prepayment when due of any principal of or interest
on any Loan, or any reimbursement obligation for a disbursement made under any
Letter of Credit, or any fees or other amount payable by it hereunder or under
any Security Instrument and such default, other than a default of a payment or
prepayment of principal (which shall have no cure period), shall continue unremedied
for a period of five (5) Business Days; or


 


(b)                                 any Borrower or any
Subsidiary shall default in the payment when due of any principal of or
interest on any of its other Debt aggregating $25,000,000 or more, or any event
specified in any note, agreement, indenture or other document evidencing or
relating to any such Debt shall occur if the effect of such event is to cause,
or (with the giving of any notice or the lapse of time or both) to permit the
holder or holders of such Debt (or a trustee or administrative agent on behalf
of such holder or holders) to cause, such Debt to become due prior to its
stated maturity; or


 


(c)                                  any representation,
warranty or certification made or deemed made herein or in any Security
Instrument by any Borrower or any Subsidiary, or any certificate furnished to
any Lender or the Administrative Agents pursuant to the provisions hereof or
any Security Instrument, shall prove to have been false or misleading as of the
time made or furnished in any material respect; or


 


(d)                                 any Borrower shall
default in the performance of any of its obligations under this Agreement other
than under Sections 10.13(c), 10.15 or 10.17 or ARTICLE IX;
or any Borrower shall default in the performance of any of its obligations
under Sections 10.13(c), 10.15 or 10.17 or ARTICLE IX
or any Security Instrument (other than the payment of amounts due which shall
be governed by Section 11.01(a)) and such default shall continue
unremedied for a period of thirty (30) days after the earlier to occur of
(i) notice thereof to such Borrower by the Applicable Administrative Agent
or any Lender (through the Applicable Administrative Agent), or (ii) such
Borrower otherwise becoming aware of such default; or


 


(e)                                  any Borrower, any
Material Subsidiary or Material Foreign Subsidiary shall admit in writing its
inability to, or be generally unable to, pay its debts as such debts become
due; or


 


(f)                                    any Borrower, any
Material Subsidiary or Material Foreign Subsidiary shall (i) apply for or
consent to the appointment of, or the taking of possession by, a receiver,
custodian, trustee or liquidator of itself or of all or a substantial part of
its property, (ii) make a general assignment for the benefit of its creditors,
(iii) commence a voluntary case under the Bankruptcy Code, the Bankruptcy
and Insolvency Act (Canada) or the Companies’ Creditors Arrangement Act
(Canada), as applicable, (iv) file a petition seeking to take advantage of any
other law relating to bankruptcy, insolvency, reorganization, winding-up,
liquidation or composition or readjustment of debts, (v) fail to
controvert in a timely and appropriate manner, or acquiesce in writing to, any
petition filed against it in an involuntary case under the Bankruptcy Code, the


 


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Bankruptcy and Insolvency Act
(Canada) or the Companies’ Creditors Arrangement Act (Canada), as applicable,
or (vi) take any corporate action for the purpose of effecting any of the
foregoing; or


 


(g)                                 a proceeding or case
shall be commenced, without the application or consent of a Borrower, Material
Subsidiary or Material Foreign Subsidiary, in any court of competent
jurisdiction, seeking (i) its liquidation, reorganization, dissolution or
winding-up, or the composition or readjustment of its debts, (ii) the
appointment of a trustee, receiver, custodian, liquidator or the like of a
Borrower, Material Subsidiary or Material Foreign Subsidiary of all or any
substantial part of its assets, or (iii) similar relief in respect of a
Borrower, Material Subsidiary or Material Foreign Subsidiary under any law
relating to bankruptcy, insolvency, reorganization, winding-up, or composition
or adjustment of debts, and such proceeding or case shall continue undismissed,
or an order, judgment or decree approving or ordering any of the foregoing
shall be entered and continue unstayed and in effect, for a period of
60 days; or (iv) an order for relief against a Borrower, Material
Subsidiary or Material Foreign Subsidiary shall be entered in an involuntary
case under the Bankruptcy Code, the Bankruptcy and Insolvency Act (Canada) or
the Companies’ Creditors Arrangement Act (Canada), as applicable; or


 


(h)                                 a judgment or
judgments for the payment of money in excess of insurance coverage aggregating
$15,000,000 or more at any one time outstanding shall be rendered by a court
against any Borrower or any Subsidiary and the same shall not be discharged (or
provision shall not be made for such discharge), or a stay of execution thereof
shall not be procured, within thirty (30) days from the date of entry
thereof and a Borrower or such Subsidiary shall not, within said period of
30 days, or such longer period during which execution of the same shall
have been stayed, appeal therefrom and cause the execution thereof to be stayed
during such appeal; or


 


(i)                                     the Loan Documents
after delivery thereof shall for any reason, except to the extent permitted by
the terms thereof, cease to be in full force and effect and valid, binding and
enforceable in accordance with their terms, or, with respect to the Security
Instruments, shall cease to create a valid and perfected Lien of the priority
required thereby on any of the Collateral purported to be covered thereby,
except to the extent permitted by the terms of this Agreement, or any Borrower
or any Subsidiary shall so state in writing; or


 


(j)                                     a Change of
Control shall occur; or


 


(k)                                  an ERISA Event shall
have occurred that, in the opinion of the Majority Lenders, when taken together
with all other ERISA Events that have occurred, could reasonably be expected to
result in liability of a Borrower and any of its Subsidiaries in an aggregate
amount exceeding $5,000,000 for all periods.


 


Section 11.02                          Remedies.


 


(a)                                  In the case of an
Event of Default other than one referred to in clauses (f) or (g) of Section 11.01,
the Applicable Administrative Agent, upon request of the Majority Lenders,
shall, by notice to the Borrowers, cancel the Aggregate Revolving Commitments
and/or declare the principal amount then outstanding of, and the accrued
interest on, the Loans and all other amounts payable by the Borrowers hereunder
and under the Notes (including without limitation


 


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the payment of cash collateral
to secure the LC Exposure as provided in Section 2.10(b) and the BA
Exposure as provided in Section 2.12(i)) to be forthwith due and
payable, whereupon such amounts shall be immediately due and payable without
presentment, demand, protest, notice of intent to accelerate, notice of
acceleration or other formalities of any kind, all of which are hereby
expressly waived by the Applicable Borrower.


 


(b)                                 In the case of the
occurrence of an Event of Default referred to in clauses (f) or (g) of Section 11.01,
the Aggregate Revolving Commitments and the Aggregate Term Commitments shall be
automatically canceled and the principal amount then outstanding of, and the
accrued interest on, the Loans and all other amounts payable by the Borrowers
hereunder and under the Notes (including without limitation the payment of cash
collateral to secure the LC Exposure as provided in Section 2.10(b)
and the BA Exposure as provided in Section 2.12(i)) shall become
automatically immediately due and payable without presentment, demand, protest,
notice of intent to accelerate, notice of acceleration or other formalities of
any kind, all of which are hereby expressly waived by the Borrowers.


 


(c)                                  Notwithstanding
anything to the contrary in the Loan Documents, on the CAM Exchange Date, the
Lenders shall automatically and without further act be deemed to have exchanged
interests in the Aggregate Credit Exposure under the Tranches (including
participations in the undrawn amounts of Letters of Credit) such that, in lieu
of the interest of each Lender in the Credit Exposure under each Tranche in
which it shall participate as of such date (including the principal,
reimbursement, interest and fee obligations of each Borrower in respect of each
such Tranche and such Lender’s participation in undrawn Letters of Credit),
such Lender shall own an interest equal to such Lender’s CAM Percentage in the
Aggregate Credit Exposure under the Tranches (including the principal,
reimbursement, interest and fee obligations of each Borrower in respect of each
such Tranche and hold a participation in the undrawn amount of each outstanding
Letter of Credit equal to its CAM Percentage thereof).  Each Lender, each person acquiring a
participation from any Lender as contemplated by Section 13.06(c) and
each Borrower hereby consents and agrees to the CAM Exchange.  Each Borrower and each Lender agrees from
time to time to execute and deliver to the US Administrative Agent all such
promissory notes and other instruments and documents as the US Administrative
Agent shall reasonably request to evidence and confirm the respective interests
and obligations of the Lenders after giving effect to the CAM Exchange, and
each Lender agrees to surrender any promissory notes originally received by it
in connection with its Loans hereunder to the US Administrative Agent against
delivery of any promissory notes so executed and delivered;  provided, however, that the failure of any
Borrower to execute or deliver or of any Lender to accept any such promissory
note, instrument or document shall not affect the validity or effectiveness of
the CAM Exchange.  In the event the CAM
Exchange Date shall occur, Indebtedness owed by the Borrowers under the Loan
Documents denominated in Canadian Dollars (other than, for the avoidance of
doubt, obligations in respect of undrawn Offshore Currency Letters of Credit)
shall, automatically and with no further act required, be converted to
obligations of the same Borrower denominated in US Dollars.  Such conversion shall be effected based upon
the exchange rate described in the definition of “US Dollar Equivalent Amount”
on the CAM Exchange Date.  On and after
any such conversion, all amounts accruing and owed to any Lender in respect of
the Indebtedness owed to it under the Loan Documents shall accrue and be
payable in US Dollars at the rates otherwise applicable hereunder.  Subject to Section 11.02(d), as a
result of the CAM Exchange, upon and after the CAM Exchange Date, each


 


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payment or proceeds received by
the Applicable Administrative Agent pursuant to or as a result of the execution
of any remedy under any Loan Document in respect of the Indebtedness of the
Borrowers under the Loan Documents shall be distributed to the Lenders pro rata
in accordance with their respective CAM Percentages.  Any direct payment received by a Lender upon
or after the CAM Exchange Date, including by way of set-off, in respect of the
Indebtedness under the Loan Documents shall be paid over to the US
Administrative Agent for distribution to the Lenders in accordance herewith.


 


(d)                                 Hedging Agreements
between any US Borrower and any of its Subsidiaries and the Administrative
Agents or a Lender and/or any Lender Affiliate are secured by the Security
Instruments pari passu with all
other Indebtedness.  As such, proceeds
from Security Instruments shall be shared pro rata on all Indebtedness.  All proceeds received after the Term Loan
Maturity Date, whether by acceleration or otherwise, shall be applied first to
reimbursement of expenses provided for in the Security Instruments; next, all
such proceeds shall be shared pro rata between the Hedging Agreements (which
form part of the Indebtedness) on the one hand and all other Indebtedness
pursuant to this Agreement and the other Loan Documents on the other hand.  Thereafter, all such proceeds applicable to
the Loans and other obligations under this Agreement and the other Loan
Documents shall be applied, first to reimbursement of expenses and indemnities
provided for in this Agreement and the other Loan Documents; second to accrued
interest on the Loans; third to fees; fourth pro rata to principal outstanding
on the Loans and other Indebtedness and to serve as cash collateral to be held
by the US Administrative Agent to secure the LC Exposure and by the Canadian
Administrative Agent to secure outstanding BA Exposure; and any excess shall be
paid to the US Borrowers or as otherwise required by any Governmental
Requirement.


 


(e)                                  Acceleration and
termination of all Hedging Agreements involving the Administrative Agents or
Lenders or the Lender Affiliates shall be governed by the terms of the Hedging
Agreements.


 


Section 11.03                          Letters of Credit.


 


(a)                                  In the event that on
the CAM Exchange Date any LC Exposure shall be outstanding, each US Tranche
Revolving Lender shall promptly pay over to the US Administrative Agent, in
immediately available funds, an amount in US Dollars equal to such US Tranche
Revolving Lender’s US Tranche Percentage of such LC Exposure (or, in the case
of any Offshore Currency Letter of Credit, the US Dollar Equivalent of such LC
Exposure) together with interest thereon from the CAM Exchange Date to the date
on which such amount shall be paid to the US Administrative Agent at the rate
that would be applicable at the time to a US Dollar Base Rate Loan in a
principal amount equal to such US Lender’s US Tranche Percentage of the LC
Exposure.  The US Administrative Agent
shall establish a separate account (each, a “Reserve Account”) or
accounts for each Lender for the amounts received with respect to each such
Letter of Credit pursuant to the preceding sentence.  The US Administrative Agent shall have sole
dominion and control over each Reserve Account, and the amounts deposited in
each Reserve Account shall be held in such Reserve Account until withdrawn as
provided in paragraph (b), (c), (d) or (e) below.  The US Administrative Agent shall maintain
records enabling it to determine the amounts paid over to it and deposited in
the Reserve Accounts in respect of each Letter of Credit and the amounts on
deposit in respect of each letter of Credit attributable to each Lender’s CAM
Percentage.  The amounts held in each
Lender’s Reserve


 


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Account shall be held as a
reserve against the LC Exposure, shall be the property of such Lender, shall
not constitute Loans to or give rise to any claim of or against any Borrower
and shall not give rise to any obligation on the part of the Borrowers to pay
interest to such Lender, it being agreed that the reimbursement obligations in
respect of Letters of Credit shall arise only at such times as drawings are
made thereunder, as provided in Section 2.10.


 


(b)                                 In
the event that after the CAM Exchange Date any drawing shall be made in respect
of a Letter of Credit, the US Administrative Agent shall, at the request of the
applicable Issuing Bank, withdraw from the Reserve Account of each Lender any
amounts, up to the amount of such Lender’s CAM Percentage of such drawing or
payment, deposited in respect of such Letter of Credit and remaining on deposit
and deliver such amounts to such Issuing Bank in satisfaction of the
reimbursement obligations of the US Tranche Revolving Lenders under Section
2.10(c).  In the event that any US
Tranche Revolving Lender shall default on its obligation to pay over any amount
to the US Administrative Agent as provided in this Section 11.03, the
applicable Issuing Bank shall have a claim against such US Tranche Revolving
Lender to the same extent as if such US Tranche Revolving Lender had defaulted
on its obligations under Section 2.10(c), but shall have no claim against any
other Lender in respect of such defaulted amount, notwithstanding the exchange
of interests in the US Borrowers’ reimbursement obligations pursuant to Section
11.02(c).  Each other Lender shall have a
claim against such defaulting US Tranche Revolving Lender for any damages
sustained by it as a result of such default, including, in the event that such
Letter of Credit shall expire undrawn, its CAM Percentage of the defaulted
amount.


 


(c)                                  In
the event that after the CAM Exchange Date any Letter of Credit shall expire
undrawn, the US Administrative Agent shall withdraw from the Reserve Account of
each Lender the amount remaining on deposit therein in respect of such Letter
of Credit, and distribute such amount to such Lender.


 


(d)                                 With
the prior written approval of the US Administrative Agent (not to be
unreasonably withheld), any Lender may withdraw the amount held in its Reserve
Account in respect of the undrawn amount of any Letter of Credit.  Any Lender making such a withdrawal shall be
unconditionally obligated, in the event there shall subsequently be a drawing
under such Letter of Credit, to pay to the US Administrative Agent, for the
account of the Issuing Bank, on demand, its CAM Percentage of such drawing or
payment.


 


(e)                                  Pending
the withdrawal by any Lender of any amounts from its Reserve Account as
contemplated by the above paragraphs, the US Administrative Agent will, at the
direction of such Lender and subject to such rules as the US Administrative
Agent may prescribe for the avoidance of inconvenience, invest such amounts in
Investments described in Sections 10.03(c), (d), (e) or (f).  Each Lender that has not withdrawn its
amounts in its Reserve Account as provided in paragraph (d) above shall have
the right, at intervals reasonably specified by the US Administrative Agent, to
withdraw the earnings on investments so made by the US Administrative Agent
with amounts in its Reserve Account and to retain such earnings for its own
account.


 


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ARTICLE XII

The Administrative Agent


 


Section 12.01                          Appointment, Powers and
Immunities of the Administrative Agents. 
Each Applicable Lender hereby irrevocably appoints and authorizes the
Applicable Administrative Agent to act as its administrative agent hereunder
and under the Security Instruments with such powers as are specifically
delegated to such Applicable Administrative Agent by the terms of this
Agreement and the Security Instruments, together with such other powers as are
reasonably incidental thereto.  The
Applicable Administrative Agent (which term as used in this sentence and in Section 12.05
and the first sentence of Section 12.06 shall include reference to
its Affiliates and its and its Affiliates’ officers, directors, employees,
attorneys, accountants, experts and administrative agents):  (a) shall have no duties or
responsibilities except those expressly set forth in the Loan Documents, and
shall not by reason of the Loan Documents be a trustee or fiduciary for any
Lender; (b) makes no representation or warranty to any Lender and shall not be
responsible to the Lenders for any recitals, statements, representations or
warranties contained in this Agreement, or in any certificate or other document
referred to or provided for in, or received by any of them under, this
Agreement, or for the value, validity, effectiveness, genuineness, execution,
effectiveness, legality, enforceability or sufficiency of this Agreement, any
Note or any other document referred to or provided for herein or for any
failure by the Borrowers or any other Person (other than the Applicable
Administrative Agent) to perform any of its obligations hereunder or thereunder
or for the existence, value, perfection or priority of any collateral security
or the financial or other condition of the Applicable Borrower, its
Subsidiaries or any other obligor or guarantor; (c) except pursuant to Section 12.07
shall not be required to initiate or conduct any litigation or collection
proceedings hereunder; and (d) shall not be responsible for any action
taken or omitted to be taken by it hereunder or under any other document or
instrument referred to or provided for herein or in connection herewith
including its own ordinary negligence, except for its and its officers’, employees’,
agents’ and representatives’ gross negligence or willful misconduct; provided,
however, the Administrative Agents may employ administrative agents,
accountants, attorneys and experts and shall not be responsible for the
negligence or misconduct of any such administrative agents, accountants,
attorneys or experts selected by it in good faith or any action taken or
omitted to be taken in good faith by it in accordance with the advice of such
administrative agents, accountants, attorneys or experts.  The Administrative Agents may deem and treat
the payee of any Note as the holder thereof for all purposes hereof unless and
until a written notice of the assignment or transfer thereof permitted
hereunder shall have been filed with such Administrative Agents.  The Administrative Agents are authorized to
release any collateral that is permitted to be sold or released pursuant to the
terms of the Loan Documents.


 


Section 12.02                          Reliance by the
Administrative Agents.  The
Administrative Agents shall be entitled to rely upon any certification, notice
or other communication (including any thereof by telephone, telex, telecopier,
telegram or cable) believed by it to be genuine and correct and to have been
signed or sent by or on behalf of the proper Person or Persons, and upon advice
and statements of legal counsel, independent accountants and other experts
selected by the Administrative Agents.


 


Section 12.03                          Defaults.  The Administrative Agents shall not be deemed
to have knowledge of the occurrence of a Default (other than the non-payment of
principal of or interest


 


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on Loans or of fees or failure
to reimburse for Letter of Credit drawings) unless the Administrative Agents
have received notice from a Lender or a Borrower specifying such Default and
stating that such notice is a “Notice of Default.”  In the event that the Administrative Agents
receive such a notice of the occurrence of a Default, the Administrative Agents
shall give prompt notice thereof to the Applicable Lenders.  In the event of a payment Default, the
Administrative Agents shall give each Applicable Lender prompt notice of each
such payment Default.


 


Section 12.04                          Rights as a Lender.  With respect to its US Tranche Commitments or
Canadian Allocated Commitments and the Loans made by it and its participation
in the issuance of Letters of Credit, each Applicable Administrative Agent (and
any successor acting as such Applicable Administrative Agent) in its capacity
as a Lender hereunder shall have the same rights and powers hereunder as any
other Lender and may exercise the same as though it were not acting as the
Applicable Administrative Agent, and the term “Lender” or “Lenders” shall,
unless the context otherwise indicates, include the Applicable Administrative
Agent in its individual capacity.  Each
Applicable Administrative Agent (and any successor acting as such Applicable
Administrative Agent) and its Affiliates may (without having to account
therefor to any Lender) accept deposits from, lend money to and generally
engage in any kind of banking, trust or other business with the Applicable
Borrower (and any of its Affiliates) as if it were not acting as the Applicable
Administrative Agent, and each Applicable Administrative Agent and its Affiliates
may accept fees and other consideration from the Borrowers for services in
connection with this Agreement or otherwise without having to account for the
same to the Lenders.


 


Section 12.05                     INDEMNIFICATION.  THE LENDERS AGREE TO INDEMNIFY THE
ADMINISTRATIVE AGENTS AND THE ISSUING BANK RATABLY IN ACCORDANCE WITH THEIR
PERCENTAGE SHARES PRIOR TO THE CAM EXCHANGE DATE AND WITH THEIR CAM PERCENTAGE
ON OR AFTER THE CAM EXCHANGE DATE FOR THE INDEMNITY MATTERS AS DESCRIBED IN SECTION 13.03
TO THE EXTENT NOT INDEMNIFIED OR REIMBURSED BY THE BORROWERS UNDER SECTION 13.03,
BUT WITHOUT LIMITING THE OBLIGATIONS OF THE BORROWERS UNDER SAID SECTION 13.03
AND FOR ANY AND ALL OTHER LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES,
ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES OR DISBURSEMENTS OF ANY KIND AND
NATURE WHATSOEVER WHICH MAY BE IMPOSED ON, INCURRED BY OR ASSERTED AGAINST THE
ADMINISTRATIVE AGENTS OR THE ISSUING BANK IN ANY WAY RELATING TO OR ARISING OUT
OF:  (a) THIS AGREEMENT, THE
SECURITY INSTRUMENTS OR ANY OTHER DOCUMENTS CONTEMPLATED BY OR REFERRED TO
HEREIN OR THE TRANSACTIONS CONTEMPLATED HEREBY, BUT EXCLUDING, UNLESS A DEFAULT
HAS OCCURRED AND IS CONTINUING, NORMAL ADMINISTRATIVE COSTS AND EXPENSES
INCIDENT TO THE PERFORMANCE OF THEIR AGENCY DUTIES HEREUNDER OR (b) THE
ENFORCEMENT OF ANY OF THE TERMS OF THIS AGREEMENT, ANY SECURITY INSTRUMENT OR
OF ANY SUCH OTHER DOCUMENTS; WHETHER OR NOT ANY OF THE FOREGOING SPECIFIED IN
THIS SECTION 12.05 ARISES FROM THE SOLE OR CONCURRENT NEGLIGENCE OF
THE ADMINISTRATIVE AGENTS OR THE ISSUING BANK, PROVIDED THAT NO LENDER
SHALL BE LIABLE FOR ANY OF THE FOREGOING TO THE EXTENT THEY ARISE FROM THE
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE ADMINISTRATIVE AGENTS OR THE
ISSUING BANK, AS THE CASE MAY BE; PROVIDED FURTHER THAT THE OBLIGATION
TO INDEMNIFY THE ISSUING BANK HEREUNDER


 


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WILL BE
THE OBLIGATIONS OF THE US TRANCHE REVOLVING LENDERS PRIOR TO THE CAM EXCHANGE
DATE AND ALL OF THE LENDERS ON OR AFTER THE CAM EXCHANGE DATE.


 


Section 12.06                          Non-Reliance on the
Administrative Agents and other Lenders. 
Each Lender acknowledges and agrees that it has, independently and
without reliance on the Administrative Agents or any other Lender, and based on
such documents and information as it has deemed appropriate, made its own
credit analysis of each US Borrower and its decision to enter into this
Agreement, and that it will, independently and without reliance upon the
Administrative Agents or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
analysis and decisions in taking or not taking action under this
Agreement.  The Administrative Agents
shall not be required to keep itself informed as to the performance or
observance by the Borrowers of this Agreement, the Notes, the Security
Instruments or any other document referred to or provided for herein or to
inspect the properties or books of the Borrowers.  Except for notices, reports and other
documents and information expressly required to be furnished to the Lenders by
the Applicable Administrative Agent hereunder, such Applicable Administrative
Agent shall not have any duty or responsibility to provide any Lender with any
credit or other information concerning the affairs, financial condition or
business of the Borrowers (or any of its Affiliates) which may come into the
possession of such Applicable Administrative Agent or any of its
Affiliates.  In this regard, each Lender
acknowledges that Vinson & Elkins L.L.P. is acting in this transaction as
special US counsel to the US Administrative Agent only and Goodmans LLP is
acting in this transaction as special Canadian counsel to the Canadian
Administrative Agent only, except to the extent otherwise expressly stated in
any legal opinion or any Loan Document. 
Each Lender will consult with its own legal counsel to the extent that
it deems necessary in connection with the Loan Documents and the matters
contemplated therein.


 


Section 12.07                          Action by the Administrative
Agents.  Except for action or other
matters expressly required of each Applicable Administrative Agent hereunder,
each Applicable Administrative Agent shall in all cases be fully justified in
failing or refusing to act hereunder unless it shall (a) receive written
instructions from the Majority Lenders (or all of the Lenders as expressly
required by Section 13.04) specifying the action to be taken, and
(b) be indemnified to its satisfaction by the Lenders against any and all
liability and expenses which may be incurred by it by reason of taking or
continuing to take any such action.  The
instructions of the Majority Lenders (or all of the Lenders as expressly
required by Section 13.04) and any action taken or failure to act
pursuant thereto by the Applicable Administrative Agent shall be binding on all
of the Lenders.  If a Default has
occurred and is continuing, each Applicable Administrative Agent shall take
such action with respect to such Default as shall be directed by the Majority
Lenders (or all of the Lenders as required by Section 13.04) in the
written instructions (with indemnities) described in this Section 12.07,
provided that, unless and until the Applicable Administrative Agent
shall have received such directions, such Applicable Administrative Agent may
(but shall not be obligated to) take such action, or refrain from taking such
action, with respect to such Default as it shall deem advisable in the best
interests of the Lenders.  In no event,
however, shall the Applicable Administrative Agent be required to take any
action which exposes such Applicable Administrative Agent to personal liability
or which is contrary to this Agreement and the Security Instruments or
applicable law.


 


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Section 12.08                          Resignation or Removal of
the Administrative Agents.  Subject
to the appointment and acceptance of a successor Applicable Administrative
Agent as provided below, each Applicable Administrative Agent may resign at any
time by giving notice thereof to the Lenders and the Borrowers, and each
Applicable Administrative Agent may be removed at any time with or without
cause by the Majority Lenders.  Upon any
such resignation or removal, the Majority Lenders shall have the right to
appoint a successor Applicable Administrative Agent.  If no successor Applicable Administrative
Agent shall have been so appointed by the Majority Lenders and shall have
accepted such appointment within thirty (30) days after the retiring
Applicable Administrative Agent’s giving of notice of resignation or the
Majority Lenders’ removal of the retiring Applicable Administrative Agent, then
the retiring Applicable Administrative Agent may, on behalf of the Lenders,
appoint a successor Applicable Administrative Agent.  Upon the acceptance of such appointment
hereunder by a successor Applicable Administrative Agent, such successor
Applicable Administrative Agent shall thereupon succeed to and become vested
with all the rights, powers, privileges and duties of the retiring Applicable
Administrative Agent, and the retiring Applicable Administrative Agent shall be
discharged from its duties and obligations hereunder.  After any retiring Applicable Administrative
Agent’s resignation or removal hereunder as Applicable Administrative Agent,
the provisions of this ARTICLE XII and Section 13.03 shall
continue in effect for its benefit in respect of any actions taken or omitted
to be taken by it while it was acting as an Administrative Agent.


 


Section 12.09                          Notification by US
Administrative Agent.  Subject to the
provisions herein to the contrary, the US Administrative Agent shall be
required to notify only the US Tranche Revolving Lenders of any Borrowings,
continuations or conversions or of any other act requiring notice to be
provided by the US Administrative Agent hereunder.  Upon each US Tranche Revolving Lender’s
receipt of such notice from the US Administrative Agent pursuant to this Section
12.09, such Lender shall notify its respective Canadian counterpart of such
notice.


 


Section 12.10                          Joint Lead Arrangers,
Joint Book Runners, Documentation Agent. 
The Joint Lead Arrangers, the Joint Book Runners, and the Documentation
Agent shall have no duties, responsibilities or liabilities under this
Agreement and the other Loan Documents other than their duties,
responsibilities and liabilities in their capacity as Lenders hereunder.


 


ARTICLE XIII

Miscellaneous


 


Section 13.01                          Waiver.  No failure on the part of the Administrative
Agents or any Lender to exercise and no delay in exercising, and no course of
dealing with respect to, any right, power or privilege under any of the Loan
Documents shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, power or privilege under any of the Loan Documents
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege.  The remedies
provided herein are cumulative and not exclusive of any remedies provided by
law.


 


Section 13.02                          Notices.  All notices and other communications provided
for herein and in the other Loan Documents (including, without limitation, any
modifications of, or waivers or consents under, this Agreement or the other
Loan Documents) shall be given or made by telex, telecopy, courier, U.S. Mail
or Canadian Mail or in writing and
telexed, telecopied, mailed or


 


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delivered to the intended
recipient at the “Address for Notices” specified below its name on the
signature pages hereof or in the Loan Documents, except that for notices and
other communications to the Administrative Agents other than payment of money,
the Borrowers need only send such notices and communications to the US
Administrative Agent care of the Houston address of Wachovia and to the
Canadian Administrative Agent care of the Toronto, Canada address of Congress
Financial; or, as to any party, at such other address as shall be designated by
such party in a notice to each other party. 
Except as otherwise provided in this Agreement or in the other Loan
Documents, all such communications shall be deemed to have been duly given when
transmitted, if transmitted before 1:00 p.m. local time on a Business Day
(otherwise on the next succeeding Business Day) by telex or telecopier and
evidence or confirmation of receipt is obtained, or personally delivered or, in
the case of a mailed notice, three (3) Business Days after the date deposited
in the mails, postage prepaid, in each case given or addressed as aforesaid.


 


Section 13.03                          Payment of Expenses,
Indemnities, etc.


 


(a)                                  The Borrowers agree:


 


(i)                                     whether or not the
transactions hereby contemplated are consummated, to pay all reasonable
expenses of each Administrative Agent in the administration (both before and
after the execution hereof and including advice of counsel as to the rights and
duties of each Administrative Agent and the Lenders with respect thereto) of,
and in connection with the negotiation, syndication, investigation,
preparation, execution and delivery of, recording or filing of, preservation of
rights under, enforcement of, and refinancing, renegotiation or restructuring
of, the Loan Documents and any amendment, waiver or consent, whether or not
effective, relating thereto (including, without limitation, travel, photocopy,
mailing, courier, telephone and other similar expenses of each Administrative
Agent, ongoing Collateral monitoring and protection, Collateral releases and
workout matters, the cost of environmental audits, surveys and Appraisals, the
reasonable fees and disbursements of counsel and other outside consultants for
the Administrative Agents limited to one US counsel and one Canadian counsel
and, in the case of enforcement, the reasonable fees and disbursements of
counsel for the Administrative Agents and any of the Lenders); and promptly
reimburse the Administrative Agents for all amounts expended, advanced or
incurred by the Administrative Agents or the Lenders to satisfy any obligation
of the Borrowers under this Agreement or any Security Instrument, including
without limitation, all costs and expenses of foreclosure;


 


(ii)                                TO
INDEMNIFY EACH ADMINISTRATIVE AGENT AND EACH LENDER AND EACH LENDER AFFILIATE
AND EACH OF THEIR OFFICERS, DIRECTORS, EMPLOYEES, REPRESENTATIVES,
ADMINISTRATIVE AGENTS, ATTORNEYS, ACCOUNTANTS, INVESTMENT ADVISORS, AGENTS,
TRUSTEES AND EXPERTS (“INDEMNIFIED PARTIES”) FROM, HOLD EACH OF THEM
HARMLESS AGAINST AND PROMPTLY UPON DEMAND PAY OR REIMBURSE EACH OF THEM FOR,
THE INDEMNITY MATTERS WHICH MAY BE INCURRED BY OR ASSERTED AGAINST OR INVOLVE
ANY OF THEM (WHETHER OR NOT ANY OF THEM IS DESIGNATED A PARTY THERETO) AS A
RESULT OF, ARISING OUT OF OR IN ANY WAY RELATED TO (A) ANY ACTUAL OR
PROPOSED USE BY THE BORROWERS OF THE PROCEEDS OF ANY OF THE LOANS OR LETTERS OF
CREDIT, (B) THE EXECUTION, DELIVERY AND PERFORMANCE OF THE LOAN DOCUMENTS,
(C) THE OPERATIONS OF


 


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THE BUSINESS
OF EACH BORROWER AND ITS SUBSIDIARIES, (D) THE FAILURE OF EACH BORROWER OR
ANY SUBSIDIARY TO COMPLY WITH THE TERMS OF ANY SECURITY INSTRUMENT OR THIS
AGREEMENT, OR WITH ANY GOVERNMENTAL REQUIREMENT, (E) ANY INACCURACY OF ANY
REPRESENTATION OR ANY BREACH OF ANY WARRANTY OF A BORROWER SET FORTH IN ANY OF
THE LOAN DOCUMENTS, (F) THE ISSUANCE, EXECUTION AND DELIVERY OR TRANSFER
OF OR PAYMENT OR FAILURE TO PAY UNDER ANY LETTER OF CREDIT, (VII) THE
PAYMENT OF A DRAWING UNDER ANY LETTER OF CREDIT NOTWITHSTANDING THE
NON-COMPLIANCE, NON-DELIVERY OR OTHER IMPROPER PRESENTATION OF THE MANUALLY
EXECUTED DRAFT(S) AND CERTIFICATION(S), (G) ANY ASSERTION THAT THE LENDERS
WERE NOT ENTITLED TO RECEIVE THE PROCEEDS RECEIVED PURSUANT TO THE SECURITY
INSTRUMENTS OR (H) ANY OTHER ASPECT OF THE LOAN DOCUMENTS, INCLUDING,
WITHOUT LIMITATION, THE REASONABLE FEES AND DISBURSEMENTS OF COUNSEL AND ALL
OTHER EXPENSES INCURRED IN CONNECTION WITH INVESTIGATING, DEFENDING OR
PREPARING TO DEFEND ANY SUCH ACTION, SUIT, PROCEEDING (INCLUDING ANY
INVESTIGATIONS, LITIGATION OR INQUIRIES) OR CLAIM AND INCLUDING ALL INDEMNITY
MATTERS ARISING BY REASON OF THE ORDINARY NEGLIGENCE OF ANY INDEMNIFIED PARTY,
BUT EXCLUDING ALL INDEMNITY MATTERS ARISING SOLELY BY REASON OF CLAIMS BETWEEN
THE LENDERS OR ANY LENDER AND AN ADMINISTRATIVE AGENT OR A LENDER’S
SHAREHOLDERS AGAINST AN ADMINISTRATIVE AGENT OR LENDER OR BY REASON OF THE
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT ON THE PART OF SUCH INDEMNIFIED PARTY;
AND


 


(iii)                            TO
INDEMNIFY AND HOLD HARMLESS FROM TIME TO TIME THE INDEMNIFIED PARTIES FROM AND
AGAINST ANY AND ALL LOSSES, CLAIMS, COST RECOVERY ACTIONS, ADMINISTRATIVE
ORDERS OR PROCEEDINGS, DAMAGES AND LIABILITIES TO WHICH ANY SUCH PERSON MAY
BECOME SUBJECT (A) UNDER ANY ENVIRONMENTAL LAW APPLICABLE TO A BORROWER OR
ANY SUBSIDIARY OR ANY OF THEIR PROPERTIES, INCLUDING WITHOUT LIMITATION, THE
TREATMENT OR DISPOSAL OF HAZARDOUS SUBSTANCES ON ANY OF THEIR PROPERTIES, (B) AS
A RESULT OF THE BREACH OR NON-COMPLIANCE BY A BORROWER OR ANY SUBSIDIARY WITH
ANY ENVIRONMENTAL LAW APPLICABLE TO A BORROWER OR ANY SUBSIDIARY, (C) DUE
TO PAST OWNERSHIP BY A BORROWER OR ANY SUBSIDIARY OF ANY OF THEIR PROPERTIES OR
PAST ACTIVITY ON ANY OF THEIR PROPERTIES WHICH, THOUGH LAWFUL AND FULLY
PERMISSIBLE AT THE TIME, COULD RESULT IN PRESENT LIABILITY, (IV) THE
PRESENCE, USE, RELEASE, STORAGE, TREATMENT OR DISPOSAL OF HAZARDOUS SUBSTANCES
ON OR AT ANY OF THE PROPERTIES OWNED OR OPERATED BY A BORROWER OR ANY
SUBSIDIARY, OR (D) ANY OTHER ENVIRONMENTAL, HEALTH OR SAFETY CONDITION IN
CONNECTION WITH THE LOAN DOCUMENTS; PROVIDED, HOWEVER, NO
INDEMNITY SHALL BE AFFORDED UNDER THIS SECTION 13.03(a)(iii) IN
RESPECT OF ANY PROPERTY FOR ANY OCCURRENCE ARISING FROM THE ACTS OR OMISSIONS
OF ANY INDEMNIFIED PARTY AFTER THE DATE WHICH THE APPLICABLE BORROWER OR
SUBSIDIARY IS DIVESTED OF OWNERSHIP OF SUCH PROPERTY (WHETHER BY FORECLOSURE OR
DEED IN LIEU OF FORECLOSURE, AS MORTGAGEE-IN-POSSESSION OR OTHERWISE).


 


(b)                                 No Indemnified Party
may settle any claim to be indemnified without the consent of the indemnitor,
such consent not to be unreasonably withheld; provided, that the
indemnitor


 


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may not reasonably withhold
consent to any settlement that an Indemnified Party proposes, if the indemnitor
does not have the financial ability to pay all its obligations outstanding and
asserted against the indemnitor at that time, including the maximum potential
claims against the Indemnified Party to be indemnified pursuant to this Section 13.03.


 


(c)                                  In the case of any
indemnification hereunder, an Applicable Administrative Agent or Lender, as
appropriate shall give notice to the Borrowers of any such claim or demand
being made against the Indemnified Party and the Borrowers shall have the
non-exclusive right to join in the defense against any such claim or demand provided
that if the Borrowers provides a defense, the Indemnified Party shall bear its
own cost of defense unless there is a conflict between the Borrowers and such
Indemnified Party.


 


(d)                                  THE
FOREGOING INDEMNITIES SHALL EXTEND TO THE INDEMNIFIED PARTIES NOTWITHSTANDING
THE SOLE OR CONCURRENT NEGLIGENCE OF EVERY KIND OR CHARACTER WHATSOEVER,
WHETHER ACTIVE OR PASSIVE, WHETHER AN AFFIRMATIVE ACT OR AN OMISSION, INCLUDING
WITHOUT LIMITATION, ALL TYPES OF NEGLIGENT CONDUCT IDENTIFIED IN THE
RESTATEMENT (SECOND) OF TORTS OF ONE OR MORE OF THE INDEMNIFIED PARTIES OR BY
REASON OF STRICT LIABILITY IMPOSED WITHOUT FAULT ON ANY ONE OR MORE OF THE
INDEMNIFIED PARTIES.  TO THE EXTENT THAT
AN INDEMNIFIED PARTY IS FOUND TO HAVE COMMITTED AN ACT OF GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT, THIS CONTRACTUAL OBLIGATION OF INDEMNIFICATION SHALL CONTINUE
BUT SHALL ONLY EXTEND TO THE PORTION OF THE CLAIM THAT IS DEEMED TO HAVE
OCCURRED BY REASON OF EVENTS OTHER THAN THE GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT OF THE INDEMNIFIED PARTY.


 


(e)                                  Each Borrower’s
obligations under this Section 13.03 shall be its joint and several
obligations and shall survive any termination of this Agreement and the payment
of the Notes and shall continue thereafter in full force and effect.


 


(f)                                    Each Borrower shall
pay any amounts due under this Section 13.03 within thirty
(30) days of the receipt by such Borrower of notice of the amount due.


 


Section 13.04                          Amendments, Etc.  Any provision of this Agreement or any
Security Instrument may be amended, modified or waived with the Borrowers’ and
the Majority Lenders’ prior written consent; provided that (a) no
amendment, modification or waiver which increases the Aggregate Commitments,
forgives or reduces the Principal Amount of any Indebtedness outstanding under
this Agreement, releases all or substantially all of the Collateral or the
Subsidiary Guarantors, affects Sections 4.02, 4.05, 11.02(d),
13.04 or 13.06(a) or permits an Interest Period with a duration
in excess of six months or modifies the definition of “Majority Lenders”
shall be effective without consent of all Lenders; (b) no amendment,
modification or waiver which extends any scheduled payment date or the final
maturity of the Term Loans or reduces the interest rate applicable to the Term
Loans or the fees payable to the Term Loan Lenders or extends the time for
payment of such interest or fees shall be effective without the consent of all
the Term Loan Lenders (in lieu of the consent of the Majority Lenders); (c) no
amendment, modification or waiver which extends any scheduled payment date or
the final maturity of the Revolving Loans, reduces the interest rate applicable
to the Revolving Loans or the fees payable to the US Tranche Revolving Lenders
or the Canadian Tranche Revolving Lenders or extends the time for payment of
such interest or fees shall be effective without the consent of all the US
Tranche Revolving Lenders or the Canadian Tranche Revolving Lenders


 


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(in lieu of the consent of the
Majority Lenders); (d) no amendment, modification or waiver which increases the
US Tranche Commitment, Canadian Allocated Commitment or Term Commitment of any
Lender shall be effective without the consent of such Lender; and (e) no
amendment, modification or waiver which modifies the rights, duties or
obligations of an Applicable Administrative Agent shall be effective without
the consent of such Applicable Administrative Agent.


 


Section 13.05                          Successors and Assigns.  This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.


 


Section 13.06                          Assignments and
Participations.


 


(a)                                  No Borrower may
assign its rights or obligations hereunder or under the Notes, Bankers’
Acceptances, the BA Equivalent Notes or any Letters of Credit without the prior
consent of all of the Lenders and the Administrative Agents.


 


(b)                                 Any Term Loan Lender
may assign all or a portion of its Term Loan to a Related Fund, Affiliate (as
defined in clause (a) of the definition of “Affiliate”) or existing Term Loan
Lender, and, upon the written consent of the US Administrative Agent, the
Issuing Banks (with respect to the Revolving Credit Facility only) and the US
Borrowers, which consent shall not be unreasonably withheld, any Lender may
assign to one or more assignees, all or a portion of its rights and obligations
under this Agreement pursuant to an Assignment Agreement substantially in the
form of Exhibit E (an “Assignment”); provided, however,
that (i) any such assignment shall be in the amount of at least $5,000,000
of a Tranche with respect to the Revolving Credit Facility and at least
$1,000,000 with respect to the Term Loan B Facility or such lesser amount to
which such Borrower has consented, with Related Funds treated as one assignee
for purposes of determining compliance with such minimum assignment amount;
(ii) if the assignor is a Lender, individually or with its Lender Affiliate, in
the Revolving Tranches, the same pro rata interest in each Tranche will be
assigned; (iii) the assignee or assignor shall pay to the Applicable
Administrative Agent a processing and recordation fee of $3,500 for each
assignment; provided that only $3,500 shall be paid for pro rata
assignments by a Lender and its Canadian Lender Affiliate and only one such fee
shall be payable in connection with simultaneous assignments to or by two or
more Related Funds; (iv) if such assignment is made at a time when no Event of
Default has occurred and is continuing, any assignee of the Canadian Tranche
Revolving Lender shall satisfy the Canadian residency requirements of a
Canadian Tranche Revolving Lender; (v) any assignee shall not be a competitor
of Holdings or any of its Subsidiaries; and (vi) notwithstanding anything to
the contrary contained in this Agreement, if such assignment is made at a time
when an Event of Default has occurred and is continuing, (A) the written
consent of the US Borrowers to such assignment shall not be required, (B) the
Borrowers shall have the right to withhold all Taxes required by law to be
withheld from payments made hereunder, and shall pay such Taxes to the relevant
taxing authority or other Governmental Authority in accordance with applicable
law, and (C) any assignee of a Lender shall not be subject to the provisions of
Section 4.06(d) (other than subparagraph (ii) thereof, if applicable),
and shall not be entitled to receive any additional amounts payable pursuant to
Section 4.06(a)(A) or indemnification payments for Taxes pursuant to Section
4.06(c).  Any such assignment will
become effective upon the execution and delivery to the US Administrative Agent
of the Assignment and the consent, if required above, of the US Administrative
Agent, the Issuing Banks and, unless an Event of Default has occurred and is
continuing, the US Borrowers.


 


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Promptly after receipt of an executed Assignment, the US Administrative
Agent shall send to the Applicable Borrower a copy of such executed
Assignment.  Upon receipt of such
executed Assignment, such Borrower, will, at its own expense, execute and
deliver new Notes, Bankers’ Acceptances or BA Equivalent Notes to the assignor
and/or assignee, as appropriate, in accordance with their respective interests
as they appear.  Upon the effectiveness
of any assignment pursuant to this Section 13.06(b), the assignee will
become a “Lender,” if not already a “Lender,” for all purposes of this
Agreement and the Security Instruments. 
The assignor shall be relieved of its obligations hereunder to the
extent of such assignment (and if the assigning Lender no longer holds any
rights or obligations under this Agreement, such assigning Lender shall cease
to be a “Lender” hereunder except that its rights under Sections 4.06,
5.01, 5.05 and 13.03 shall not be affected).  The US Administrative Agent, acting as an
agent of the Borrowers, shall maintain at one of its offices a copy of each
Assignment Agreement delivered to it and a register for the recordation of the
names and addresses of the Lenders, and the principal amount of the Loans and
LC Exposure owing to, each Lender pursuant to the terms hereof from time to
time (the “Register”).  No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register.


 


(c)                                  Each
Lender may transfer, grant or assign participations in all or any part of such
Lender’s interests hereunder pursuant to this Section 13.06(c) to
any Person that satisfies the requirements of Section 13.06(b)(v) and
either Section 13.06(b)(iv) or (vi) as applicable, provided
that:  (i) such Lender shall remain
a “Lender” for all purposes of this Agreement and the transferee of such
participation shall not constitute a “Lender” hereunder; and (ii) no
participant under any such participation shall have rights to approve any
amendment to or waiver of any of the Loan Documents; provided that such
participation agreement may provide that such Lender will not, without the
consent of the participant, agree to any amendment, modification or waiver
described in clauses (a), (b) or (c) of the proviso to Section 13.04
that affects such participant, and all amounts payable by the Applicable
Borrower hereunder shall be determined as if such Lender had not sold such
participation, provided that such participant shall be entitled to
receive additional amounts under ARTICLE V on the same basis as if it
were a Lender and be indemnified under Section 13.03 as if it were
a Lender.  In addition, each agreement
creating any participation must include an agreement by the participant to be
bound by the provisions of Section 13.15.


 


(d)                                 The
Lenders may furnish any information concerning a Borrower in the possession of
the Lenders from time to time to assignees and participants (including
prospective assignees and participants); provided that, such Persons
agree to be bound by the provisions of Section 13.15.


 


(e)                                  Notwithstanding
anything in this Section 13.06 to the contrary, any Lender may at
any time pledge or assign a security interest in all or any portion of its
rights under this Agreement to secure obligations of such Lender, including,
without limitation, any pledge or assignment to secure obligations to a Federal
Reserve Bank; provided that no such pledge or assignment of a security
interest shall release a Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.


 


(f)                                    Notwithstanding
any other provisions of this Section 13.06, no transfer or
assignment of the interests or obligations of any Lender or any grant of
participations therein shall be permitted if such transfer, assignment or grant
would require any Borrower to file a


 


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registration statement with the
SEC or to qualify the Loans under the “Blue Sky” laws of any state.


 


Section 13.07                          Invalidity.  In the event that any one or more of the
provisions contained in any of the Loan Documents or the Letters of Credit,
shall, for any reason, be held invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any
other provision of the Notes, this Agreement or any Security Instrument.


 


Section 13.08                          Counterparts.  This Agreement may be executed in any number
of counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by signing
any such counterpart.


 


Section 13.09                          Reserved.


 


Section 13.10                          Survival.  The obligations of the parties under Section 4.06,
ARTICLE V, and Sections 12.05 and 13.03 shall
survive the repayment of the Loans and the termination of the US Tranche
Commitments, Canadian Allocated Commitments and Term Commitments.  To the extent that any payments on the
Indebtedness under the Loan Documents or proceeds of any Collateral are
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required to be repaid to a trustee, debtor in possession, receiver or other
Person under any bankruptcy law, common law or equitable cause, then to such
extent, the Indebtedness under the Loan Documents so satisfied shall be revived
and continue as if such payment or proceeds had not been received and each
Applicable Administrative Agent’s and Lenders’ Liens, security interests,
rights, powers and remedies under this Agreement and each Security Instrument
shall continue in full force and effect. 
In such event, each Security Instrument shall be automatically
reinstated and the Applicable Borrower shall take such action as may be
reasonably requested by the Applicable Administrative Agent and the Lenders to
effect such reinstatement.


 


Section 13.11         Reserved.


 


Section
13.12                     NO
ORAL AGREEMENTS.  THE LOAN DOCUMENTS EMBODY
THE ENTIRE AGREEMENT AND UNDERSTANDING BETWEEN THE PARTIES AND SUPERSEDE ALL
OTHER AGREEMENTS AND UNDERSTANDINGS BETWEEN SUCH PARTIES RELATING TO THE
SUBJECT MATTER HEREOF AND THEREOF.  THE
LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES.  THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.


 


Section 13.13                     GOVERNING
LAW; SUBMISSION TO JURISDICTION.


 


(a)                                  THIS
AGREEMENT AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF TEXAS EXCEPT TO THE EXTENT THAT UNITED STATES FEDERAL
LAW PERMITS ANY US LENDER TO CHARGE INTEREST AT THE RATE ALLOWED BY THE LAWS OF
THE STATE WHERE SUCH LENDER IS LOCATED OR APPLICABLE CANADIAN LAW PERMITS ANY
CANADIAN TRANCHE REVOLVING LENDER TO CHARGE INTEREST AT THE RATE ALLOWED BY THE
LAWS OF THE JURISDICTION WHERE SUCH LENDER IS LOCATED.  CH. 346 OF THE TEXAS FINANCE CODE (WHICH
REGULATES CERTAIN REVOLVING


 


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CREDIT
LOAN ACCOUNTS AND REVOLVING TRI-PARTY ACCOUNTS) SHALL NOT APPLY TO THIS
AGREEMENT OR THE NOTES.


 


(b)                                  ANY
LEGAL ACTION OR PROCEEDING WITH RESPECT TO THE LOAN DOCUMENTS SHALL BE BROUGHT
IN THE COURTS OF THE STATE OF TEXAS OR OF THE UNITED STATES OF AMERICA FOR THE
SOUTHERN DISTRICT OF TEXAS, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT,
EACH BORROWER HEREBY ACCEPTS FOR ITSELF AND (TO THE EXTENT PERMITTED BY LAW) IN
RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE
AFORESAID COURTS.  EACH BORROWER HEREBY
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING, WITHOUT LIMITATION, ANY OBJECTION
TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO
THE BRINGING OF ANY SUCH ACTION OR PROCEEDING IN SUCH RESPECTIVE
JURISDICTIONS.  THIS SUBMISSION TO
JURISDICTION IS NON-EXCLUSIVE AND DOES NOT PRECLUDE THE ADMINISTRATIVE AGENTS
OR ANY LENDER FROM OBTAINING JURISDICTION OVER EACH BORROWER IN ANY COURT
OTHERWISE HAVING JURISDICTION.


 


(c)                                  EACH
BORROWER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OF ANY OF THE
AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES
THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO SUCH BORROWER AT
ITS ADDRESS LOCATED ON THE SIGNATURE PAGE HERETO OR AS UPDATED FROM TIME TO
TIME, SUCH SERVICE TO BECOME EFFECTIVE THIRTY (30) DAYS AFTER SUCH MAILING.


 


(d)                                  NOTHING
HEREIN SHALL AFFECT THE RIGHT OF THE ADMINISTRATIVE AGENTS OR ANY LENDER OR ANY
HOLDER OF A NOTE TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO
COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE BORROWERS IN ANY
OTHER JURISDICTION.


 


(e)                                  EACH
BORROWER AND EACH LENDER HEREBY (i) IRREVOCABLY AND UNCONDITIONALLY WAIVE,
TO THE FULLEST EXTENT PERMITTED BY LAW, TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY SECURITY INSTRUMENT AND FOR ANY
COUNTERCLAIM THEREIN; (ii) IRREVOCABLY WAIVE, TO THE MAXIMUM EXTENT NOT
PROHIBITED BY LAW, ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY SUCH
LITIGATION ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES, OR
DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES; (iii) CERTIFY THAT
NO PARTY HERETO NOR ANY REPRESENTATIVE OF THE ADMINISTRATIVE AGENTS OR COUNSEL
FOR ANY PARTY HERETO HAS REPRESENTED, EXPRESSLY OR OTHERWISE, OR IMPLIED THAT
SUCH PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVERS, AND (iv) ACKNOWLEDGE THAT IT HAS BEEN INDUCED TO ENTER INTO THIS
AGREEMENT, THE SECURITY INSTRUMENTS AND THE TRANSACTIONS CONTEMPLATED HEREBY
AND THEREBY BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS
CONTAINED IN THIS SECTION 13.13.


 


Section 13.14                          Interest.  It is the intention of the parties hereto
that each Lender shall conform strictly to usury laws applicable to it.  Accordingly, if the transactions contemplated
hereby would be usurious as to any Lender under laws applicable to it
(including the laws of the United States of America and the State of Texas or
any other jurisdiction whose laws may be mandatorily applicable to such Lender
notwithstanding the other provisions of this Agreement),


 


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then, in that event,
notwithstanding anything to the contrary in any of the Loan Documents or any
agreement entered into in connection with or as security for the Notes, the
Bankers’ Acceptances and the BA Equivalent Notes, it is agreed as follows:  (a) the aggregate of all consideration
which constitutes interest under law applicable to any Lender that is
contracted for, taken, reserved, charged or received by such Lender under any of
the Loan Documents or agreements or otherwise in connection with the Notes
shall under no circumstances exceed the maximum amount allowed by such
applicable law, and any excess shall be canceled automatically and if
theretofore paid shall be credited by such Lender on the principal amount of
the Indebtedness under the Loan Documents (or, to the extent that the principal
amount of the Indebtedness under the Loan Documents shall have been or would
thereby be paid in full, refunded by such Lender to the Applicable Borrower);
and (b) in the event that the maturity of the Notes is accelerated by
reason of an election of the holder thereof resulting from any Event of Default
under this Agreement or otherwise, or in the event of any required or permitted
prepayment, then such consideration that constitutes interest under law
applicable to any Lender may never include more than the maximum amount allowed
by such applicable law, and excess interest, if any, provided for in this
Agreement or otherwise shall be canceled automatically by such Lender as of the
date of such acceleration or prepayment and, if theretofore paid, shall be
credited by such Lender on the Principal Amount of the Indebtedness under the
Loan Documents (or, to the extent that the Principal Amount of the Indebtedness
under the Loan Documents shall have been or would thereby be paid in full,
refunded by such Lender to the Applicable Borrower).  All sums paid or agreed to be paid to any
Lender for the use, forbearance or detention of sums due hereunder shall, to
the extent permitted by law applicable to such Lender, be amortized, prorated,
allocated and spread throughout the full term of the Loans evidenced by the
Notes until payment in full so that the rate or amount of interest on account
of any Loans hereunder does not exceed the maximum amount allowed by such
applicable law.  If at any time and from
time to time (i) the amount of interest payable to any Lender on any date shall
be computed at the Highest Lawful Rate applicable to such Lender pursuant to this
Section 13.14 and (ii) in respect of any subsequent interest
computation period the amount of interest otherwise payable to such Lender
would be less than the amount of interest payable to such Lender computed at
the Highest Lawful Rate applicable to such Lender, then the amount of interest payable
to such Lender in respect of such subsequent interest computation period shall
continue to be computed at the Highest Lawful Rate applicable to such Lender
until the total amount of interest payable to such Lender shall equal the total
amount of interest which would have been payable to such Lender if the total
amount of interest had been computed without giving effect to this Section 13.14.  To the extent that Chapter 303 of the Texas
Finance Code is relevant for the purpose of determining the Highest Lawful
Rate, such Lender elects to determine the applicable rate ceiling under such
Chapter by the indicated weekly rate ceiling from time to time in effect.


 


Section 13.15                          Confidentiality.  For the purposes of this Section 13.15,
“Confidential Information” means information about any Borrower
furnished by any Borrower or its Affiliates (collectively, the “Disclosing
Parties”) to the Administrative Agents or any of the Lenders, including,
but not limited to, any actual or pending agreement, business plans, budgets,
projections, ecological data and accounting records, financial statements, or
other financial data of any kind, any title documents, reports or other
information relating to matters of title, any projects or plans, whether actual
or prospective, and any other documents or items embodying any such
Confidential Information; provided that such term does not include
information that (a) was publicly known or otherwise known prior to the
time of such disclosure, (b) subsequently


 


101





















 


becomes publicly known through
no act or omission by the Administrative Agents or the Lenders or any Person
acting on behalf thereof, (c) otherwise becomes known to the
Administrative Agents or Lenders other than through disclosure by the
Disclosing Parties or a party known to be subject to a confidentiality
agreement or (d) constitutes financial statements delivered to the
Administrative Agents and the Lenders under Section 9.01(a) that
are otherwise publicly available.  The
Administrative Agents and the Lenders will maintain the confidentiality of such
Confidential Information delivered to (i) such Person, provided that
each such Person (a “Restricted Person”) may deliver or disclose
Confidential Information to such Restricted Person’s directors, officers,
employees, agents, attorneys investment advisors, trustees and Affiliates, who
agree to hold confidential the Confidential Information substantially in
accordance with the terms of this Section 13.15, (ii) such
Restricted Person’s financial advisors and other professional advisors who
agree to hold confidential the Confidential Information substantially in
accordance with the terms of this Section 13.15, (iii) any
other Lender, (iv) any pledgee referred to in Section 13.06(e) or
any assignee to which such Restricted Person sells or offers to sell its Note
or any part thereof or any participation therein (if such Person has agreed in
writing prior to its receipt of such Confidential Information to be bound by
the provisions of this Section 13.15), (v) any Person from
which such Restricted Person offers to purchase any security of the Borrowers
(if such Person has agreed in writing prior to its receipt of such Confidential
Information to be bound by the provisions of this Section 13.15),
(vi) any Governmental Authority having jurisdiction or any self-regulatory
body claiming to have authority over such Restricted Person, (vii) the
National Association of Insurance Commissioners or any similar organization, or
any nationally recognized rating agency that requires access to information
about such Restricted Person’s investment portfolio, or (viii) any other
Person to which such delivery or disclosure may be necessary or appropriate
(A) to effect compliance with any Governmental Requirement applicable to
such Restricted Person, (B) in response to any subpoena or other legal
process, (C) in connection with any litigation to which such Restricted
Person is a party or (D) if an Event of Default has occurred and is continuing,
to the extent such Restricted Person may reasonably determine such delivery and
disclosure to be necessary or appropriate in the enforcement or for the
protection of its rights and remedies under the Notes and this Agreement.  Each Lender, by its acceptance of a Note or a
participation agreement, will be deemed to have agreed to be bound by and to be
entitled to the benefits of this Section 13.15 as though it were a
party to this Agreement.  On reasonable
request by any Borrower in connection with the delivery to any Lender of
information required to be delivered to such Lender under this Agreement or
requested by such Lender (other than a Lender that is a party to this Agreement
or its nominee), such Lender will enter into an agreement with any Borrower
embodying the provisions of this Section 13.15.  Each Borrower waives (on its own behalf and
on behalf of its Subsidiaries) any and all other rights it (or its
Subsidiaries) may have to confidentiality as against the Administrative Agents
and the Lenders arising by or under any contract, agreement, statute or law
except as expressly stated in this Section 13.15.


 


Section 13.16                          Effectiveness.  This Agreement shall be effective on the
Closing Date.


 


Section 13.17                     EXCULPATION
PROVISIONS.  EACH OF THE PARTIES HERETO SPECIFICALLY
AGREES THAT IT HAS A DUTY TO READ THIS AGREEMENT AND THE SECURITY INSTRUMENTS
AND AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS OF THIS
AGREEMENT AND THE SECURITY INSTRUMENTS; THAT IT HAS IN FACT READ THIS AGREEMENT
AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE


 


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TERMS,
CONDITIONS AND EFFECTS OF THIS AGREEMENT; THAT IT HAS BEEN REPRESENTED BY
INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING
ITS EXECUTION OF THIS AGREEMENT AND THE SECURITY INSTRUMENTS; AND HAS RECEIVED
THE ADVICE OF ITS ATTORNEY IN ENTERING INTO THIS AGREEMENT AND THE SECURITY
INSTRUMENTS; AND THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS AGREEMENT
AND THE SECURITY INSTRUMENTS RESULT IN ONE PARTY ASSUMING THE LIABILITY
INHERENT IN SOME ASPECTS OF THE TRANSACTION AND RELIEVING THE OTHER PARTY OF
ITS RESPONSIBILITY FOR SUCH LIABILITY. 
EACH PARTY HERETO AGREES AND COVENANTS THAT IT WILL NOT CONTEST THE
VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS AGREEMENT AND
THE SECURITY INSTRUMENTS ON THE BASIS THAT THE PARTY HAD NO NOTICE OR KNOWLEDGE
OF SUCH PROVISION OR THAT THE PROVISION IS NOT “CONSPICUOUS.”


 


Section 13.18                          Hedging
Agreements.  Notwithstanding
anything to the contrary contained herein, the terms and provisions of this
Agreement shall not apply to any Hedging Agreements, except to the extent
necessary for all Hedging Agreements with Lenders and/or their Lender Affiliate
to be secured by the Security Instruments on a pari
passu basis with other Indebtedness and for the proceeds from the
Security Instruments to be applied as set forth in Section 11.02(d)
hereof.


 


Section 13.19                          USA
Patriot Act Notice.  Each US
Lender hereby notifies the Borrowers that pursuant to the requirements of the
USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “USA Patriot Act”), it is required to obtain, verify and
record information that identifies each US Borrower and its Subsidiaries, which
information includes the name and address of each US Borrower and such
Subsidiaries and other information that will allow such US Lender to identify
each US Borrower and such Subsidiaries in accordance with the USA Patriot Act.


 


Section 13.20                          Restatement.  This Agreement amends, restates and
supercedes the Existing Credit Agreement. 
It is the intention of the parties that all Liens and security interests
securing the Existing Credit Agreement continue to exist, remain valid and
shall not be impaired or released hereby and shall remain in full force and
effect as provided in the Security Instruments.


 


ARTICLE XIV

GUARANTY


 


Section 14.01                          The
Guaranty.


 


(a)                                  The
Guarantors irrevocably and unconditionally, jointly and severally, guarantee to
each Canadian Tranche Revolving Lender and the Administrative Agents and their
respective successors and permitted assigns the full and punctual payment of
principal and interest on each Canadian Tranche Loan when due, whether at
maturity, by acceleration, by redemption or otherwise (the “Guaranteed
Obligations”).


 


(b)                                 The
Guarantors further agree that this Guaranty constitutes an absolute,
irrevocable, complete and continuing guarantee of payment, performance and
compliance and not merely of collection.


 


103





















 


(c)                                  The
obligations of the Guarantors to make any payment hereunder may be satisfied by
causing the Canadian Borrower to make such payment.


 


(d)                                 The
Guarantors also agree to pay any and all costs and expenses (including
reasonable attorneys’ fees incurred by any Applicable Administrative Agent or
any Canadian Tranche Revolving Lender in enforcing any of their respective
rights under this Guaranty, laws or otherwise) of each Applicable
Administrative Agent or any Canadian Tranche Revolving Lender against the
Canadian Borrower or any other Person or against such Applicable Administrative
Agent or any Canadian Tranche Revolving Lender for their payments in respect of
any amounts to any Canadian Tranche Revolving Lender pursuant to the provisions
of this Guaranty.


 


(e)                                  The
Guarantors waive presentment to, demand of payment from and protest to the
Canadian Borrower of any of the Guaranteed Obligations, and also waives notice
of acceptance of its guarantee and notice of protest for nonpayment.  The obligations of the Guarantors hereunder
shall not be affected by the failure of either of the Administrative Agents or
any Canadian Tranche Revolving Lender to assert any claim or demand or to enforce
or exercise any right or remedy against the Canadian Borrower or any other
Person under the provisions of this Agreement, any other Loan Document or
otherwise.


 


(f)                                    To
the fullest extent permitted by applicable law, the obligations of the
Guarantors hereunder are absolute and unconditional and shall not be subject to
any reduction, limitation, impairment or termination for any reason (other than
the payment in full in cash of all the Guaranteed Obligations), including any
claim of waiver, release, surrender, alteration or compromise of any of the
Guaranteed Obligations, and shall not be subject to any defense (other than a
defense of payment or performance), set-off, counterclaim, recoupment or
termination whatsoever by reason of the invalidity, illegality or
unenforceability of the Guaranteed Obligations or any Note, other Loan Document
or otherwise.


 


(g)                                 The
Guarantors waive any defense based on or arising out of any defense of the
Canadian Borrower or the unenforceability of the Guaranteed Obligations or any
part thereof from any cause, or the cessation from any cause of the liability
of the Canadian Borrower, other than the final payment in full in cash of all
the Guaranteed Obligations.


 


(h)                                 To
the fullest extent permitted by applicable law, this Guaranty shall continue to
be effective or be reinstated, as the case may be, if at any time any payment
of the Guaranteed Obligations is rescinded or must otherwise be returned by any
of the Canadian Tranche Revolving Lenders upon the insolvency, bankruptcy or
reorganization or the Canadian Borrower or otherwise, all as though such
payment had not been made.


 


Section 14.02                          Subrogation.  The Guarantors shall be subrogated to any of
the rights (whether contractual, under applicable laws or otherwise) of either
of the Administrative Agents or any Canadian Tranche Revolving Lender against
the Canadian Borrower or any other Person for the payments in respect of any
amounts to any Canadian Tranche Revolving Lender pursuant to the provisions of
this Guaranty; provided, however, that the Guarantor shall not be
entitled to enforce, or to receive any payments arising out of or based upon,
such right of subrogation until all other Guaranteed Obligations shall have
been paid in full and the Canadian Allocated Total Commitments terminated.


 


104





















 


The parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.


 


	
  US BORROWER AND GUARANTOR:

  	
  UNIVERSAL COMPRESSION, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. Michael Anderson

  	
   

  
	
   

  	
  Name:

  	
  J. Michael Anderson

  
	
   

  	
  Title: 

  	
  Senior Vice President and

  Chief Financial Officer

  
	
  Address for Notices:

  	
   

  
	
   

  	
  4444 Brittmoore Road

  
	
   

  	
  Houston, Texas 77041

  
	
   

  	
   

  
	
   

  	
  Telecopier No.: (713) 466-6720

  
	
   

  	
  Telephone No.: (713) 335-7295

  
	
   

  	
  Attention: President

  
	
   

  	
   

  
	
   

  	
  Copy to: General Counsel

  
	
   

  	
   

  
	
   

  	
  Copy to:

  
	
   

  	
   

  
	
   

  	
  Carol M. Burke

  
	
   

  	
  Gardere Wynne Sewell LLP

  
	
   

  	
  1000 Louisiana, Suite 3400

  
	
   

  	
  Houston, Texas 77002

  
	
   

  	
  Telecopier No.: (713) 276-6561

  
	
   

  	
  Telephone No.: (713) 276-5561

  



 


 


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  US BORROWER AND GUARANTOR:

  	
  UNIVERSAL COMPRESSION

  
	
   

  	
  HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. Michael Anderson

  	
   

  
	
   

  	
  Name:

  	
  J. Michael Anderson

  
	
   

  	
  Title:

  	
  Senior Vice President and

  
	
   

  	
   

  	
  Chief Financial Officer

  
	
  Address for
  Notices:

  	
   

  
	
   

  	
  4444 Brittmoore Road

  
	
   

  	
  Houston, Texas 77041

  
	
   

  	
   

  
	
   

  	
  Telecopier No.: (713) 466-6720

  
	
   

  	
  Telephone No.: (713) 335-7295

  
	
   

  	
  Attention: President

  
	
   

  	
   

  
	
   

  	
  Copy to: General Counsel

  
	
   

  	
   

  
	
   

  	
  Copy to:

  
	
   

  	
   

  
	
   

  	
  Carol M. Burke

  
	
   

  	
  Gardere Wynne Sewell LLP

  
	
   

  	
  1000 Louisiana, Suite 3400

  
	
   

  	
  Houston, Texas 77002

  
	
   

  	
  Telecopier No.: (713) 276-6561

  
	
   

  	
  Telephone No.: (713) 276-5561

  



 


 


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  CANADIAN BORROWER:

  	
  UC CANADIAN PARTNERSHIP

  
	
   

  	
  HOLDINGS COMPANY

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. Michael Anderson

  	
   

  
	
   

  	
  Name:

  	
  J. Michael Anderson

  
	
   

  	
  Title:

  	
  Senior Vice President and

  
	
   

  	
   

  	
  Chief Financial Officer

  
	
  Address for
  Notices:

  	
   

  
	
   

  	
  1959 Upper Water Street

  
	
   

  	
  Suite 1100

  
	
   

  	
  Halifax, Nova Scotia B3J3E5

  
	
   

  	
   

  
	
   

  	
  Telecopier No.: (713) 466-6720

  
	
   

  	
  Telephone No.: (713) 335-7295

  
	
   

  	
  Attention: Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
  Copy to: General Counsel

  
	
   

  	
   

  
	
   

  	
  Copy to:

  
	
   

  	
   

  
	
   

  	
  Carol M. Burke

  
	
   

  	
  Gardere Wynne Sewell LLP

  
	
   

  	
  1000 Louisiana, Suite 3400

  
	
   

  	
  Houston, Texas 77002

  
	
   

  	
  Telecopier No.: (713) 276-6561

  
	
   

  	
  Telephone No.: (713) 276-5561

  



 


 


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  LENDER AND

  	
  WACHOVIA BANK, NATIONAL

  
	
  US ADMINISTRATIVE AGENT:

  	
  ASSOCIATION,
  Individually and as US

  
	
   

  	
  Administrative Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James Kipp

  	
   

  
	
   

  	
  Name:

  	
  James Kipp

  
	
   

  	
  Title:

  	
  Managing Director

  
	
   

  	
   

  
	
   

  	
  Lending Office for US Dollar Base Rate

  
	
   

  	
  Loans and LIBOR Loans:

  
	
   

  	
   

  
	
   

  	
  301 South College Street

  
	
   

  	
  23rd Floor NC 0680

  
	
   

  	
  Charlotte, North Carolina 28288

  
	
   

  	
  Telecopier No.: (704) 383-0288

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  301 South College Street

  
	
   

  	
  23rd Floor NC 0680

  
	
   

  	
  Charlotte, North Carolina 28288

  
	
   

  	
  Attention: Syndication Agency Services

  
	
   

  	
  Telecopier No.: (704) 383-0288

  
	
   

  	
   

  
	
   

  	
  With copy to:

  
	
   

  	
   

  
	
   

  	
  Wachovia Capital Markets, LLC

  
	
   

  	
  1001 Fannin, Suite 2255

  
	
   

  	
  Houston, Texas 77002

  
	
   

  	
  Attention: David Humphreys

  
	
   

  	
  Telecopier No.: 713-605-6354

  



 


 


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  LENDER AND
  CANADIAN

  	
  CONGRESS FINANCIAL

  
	
  ADMINISTRATIVE AGENT:

  	
  CORPORATION (CANADA),

  
	
   

  	
  Individually and as Canadian Administrative

  
	
   

  	
  Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Niall H. Hamilton

  	
   

  
	
   

  	
  Name:

  	
  Niall H. Hamilton

  
	
   

  	
  Title:

  	
  Senior Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office for Canadian Tranche

  
	
   

  	
  Loans:

  
	
   

  	
   

  
	
   

  	
  141 Adelaide St W., Suite 1500

  
	
   

  	
  Toronto, Ontario, Canada

  
	
   

  	
  M5H 3L9

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  141 Adelaide St W., Suite 1500

  
	
   

  	
  Toronto, Ontario, Canada

  
	
   

  	
  M5H 3L9

  
	
   

  	
   

  
	
   

  	
  Attention: Sophie Ronan

  
	
   

  	
  Telecopier No.: (416) 364-8165

  



 


 


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  LENDER AND SYNDICATION AGENT:

  	
  JPMORGAN CHASE BANK, N.A.,

  
	
   

  	
  Individually and as Syndication Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. Charles Freel, Jr.

  	
   

  
	
   

  	
  Name:

  	
  J. Charles Freel, Jr.

  
	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  
	
   

  	
  Lending Office for US Dollar Base Rate

  
	
   

  	
  Loans and LIBOR Loans:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention:

  
	
   

  	
  Telecopier No.:

  
	
   

  	
   

  
	
   

  	
  With copy to:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention:

  
	
   

  	
  Telecopier No.:

  



 


 


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  DOCUMENTATION AGENT:

  	
  DEUTSCHE BANK SECURITIES INC.,

  
	
   

  	
  as Documentation Agent

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/

  	
  Russell A. Johnson

  	
   

  
	
   

  	
  Name:

  	
  Russell A. Johnson

  
	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/

  	
  Jon R. Marinelli

  	
   

  
	
   

  	
  Name: 

  	
  Jon R. Marinelli

  
	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  
	
   

  	
  Lending Office for US Dollar Base Rate
  Loans

  
	
   

  	
  and

  
	
   

  	
  LIBOR Loans:

  
	
   

  	
   

  
	
   

  	
  Telecopier No.:

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention:

  
	
   

  	
  Telecopier No.:

  
	
   

  	
   

  
	
   

  	
  With copy to:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention:

  
	
   

  	
  Telecopier No.:

  



 


 


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  LENDER AND

  	
  THE BANK OF NOVA SCOTIA,

  
	
  DOCUMENTATION AGENT:

  	
  Individually and as Documentation Agent

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/

  	
  Vicki H. Gibson

  	
   

  
	
   

  	
  Name:

  	
  V. Gibson

  
	
   

  	
  Title:

  	
  Assistant Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office for US Base Rate Loans and

  
	
   

  	
  LIBOR Loans:

  
	
   

  	
   

  
	
   

  	
  The Bank of Nova Scotia,

  
	
   

  	
  Atlanta Agency

  
	
   

  	
  600 Peachtree Street N.E.

  
	
   

  	
  Suite 2700

  
	
   

  	
  Atlanta, Georgia 30308

  
	
   

  	
   

  
	
   

  	
  Telecopier No.: (404) 888-8998

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  The Bank of Nova Scotia, Atlanta Agency

  
	
   

  	
  600 Peachtree Street N.E.

  
	
   

  	
  Suite 2700

  
	
   

  	
  Atlanta, Georgia 30308

  
	
   

  	
   

  
	
   

  	
  Attention: Donna Gardner

  
	
   

  	
  Telecopier No.: (404) 888-8998

  
	
   

  	
   

  
	
   

  	
  With copy to:

  
	
   

  	
   

  
	
   

  	
  The Bank of Nova Scotia

  
	
   

  	
  Houston Representative Office

  
	
   

  	
  1100 Louisiana, Suite 3000

  
	
   

  	
  Houston, Texas 77002

  
	
   

  	
   

  
	
   

  	
  Attention: Jean-Paul Purdy

  
	
   

  	
  Telecopier No. (713) 752-2425

  



 


 


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  LENDER AND

  	
  THE ROYAL BANK OF SCOTLAND PLC,

  
	
  DOCUMENTATION AGENT:

  	
  Individually and as Documentation Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/

  	
  Matthew J. Main

  	
   

  
	
   

  	
  Name: 

  	
  Matthew J. Main

  
	
   

  	
  Title:

  	
  Senior Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office for US Base Rate Loans and

  
	
   

  	
  LIBOR Loans:

  
	
   

  	
   

  
	
   

  	
  101 Park Avenue, 12th Floor

  
	
   

  	
  New York, New York 10178

  
	
   

  	
   

  
	
   

  	
  Attention: Sheila Shaw

  
	
   

  	
  Telecopier No.: 212-401-1494

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  101 Park Avenue, 12th Floor

  
	
   

  	
  New York, New York 10178

  
	
   

  	
   

  
	
   

  	
  Attention: Sheila Shaw

  
	
   

  	
  Telecopier No.: 212-401-1494

  
	
   

  	
   

  
	
   

  	
  With copy to:

  
	
   

  	
   

  
	
   

  	
  The Royal Bank of Scotland plc

  
	
   

  	
  600 Travis Street

  
	
   

  	
  Suite 6500

  
	
   

  	
  Houston, Texas 77002

  
	
   

  	
   

  
	
   

  	
  Attention: Matthew J. Main

  
	
   

  	
  Telecopier No.: 713-221-2430

  



 


 


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  LENDER: Bank of America, N.A.

  	
   

  
	
   

  
	
   

  	
  By: 

  	
  /s/ 

  	
  David A Batson

  	
   

  
	
   

  	
  Name: 

  	
  David A. Batson

  
	
   

  	
  Title:  VP

  
	
   

  	
   

  
	
   

  	
  Lending Office for [US Base Rate Loans and

  
	
   

  	
  LIBOR Loans] :

  
	
   

  	
   

  
	
   

  	
  Bank of America NA

  
	
   

  	
  700 Louisiana, 7th Floor

  
	
   

  	
  Houston, Texas 77002

  
	
   

  	
  Attention: Patty Breiner

  
	
   

  	
  Telecopier No.: 713-247-7569

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  Bank of America, NA

  
	
   

  	
  700 Louisiana, 7th Floor

  
	
   

  	
  Houston, Texas 77002

  
	
   

  	
  Attention: Patty Breiner

  
	
   

  	
  Telecopier No: 713-247-7569

  
	
   

  	
   

  
	
   

  	
  With copy to:

  
	
   

  	
   

  
	
   

  	
  Bank of America, NA

  
	
   

  	
  1201 Main Street, 6 Floor

  
	
   

  	
  Dallas, Texas 75202-3113

  
	
   

  	
  Attention: Glenda Bromley

  
	
   

  	
  Telecopier No: 214-508-8419

  



 


 


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  LENDER: COMERICA BANK

  	
   

  
	
   

  	
  By: 

  	
  /s/

  	
  Mona M. Foch

  	
   

  
	
   

  	
  Name: Mona M. Foch

  
	
   

  	
  Title: Senior Vice President -Texas Division

  
	
   

  	
   

  
	
   

  	
  Lending Office for US Base Rate Loans and

  
	
   

  	
  LIBOR Loans

  
	
   

  	
   

  
	
   

  	
  Attention: Mona M. Foch

  
	
   

  	
  Telecopier No.: 713 220 5651

  
	
   

  	
   

  
	
   

  	
  Address for Notices: 910 Louisiana, Suite 410

  
	
   

  	
   

  
	
   

  	
  Houston, TX 77002

  



 


 


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  LENDER:

  	
  Union Bank of California, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ 

  	
  Sean M. Murphy

  	
   

  
	
   

  	
  Name:  Sean M. Murphy

  
	
   

  	
  Title:   Vice President

  
	
   

  	
   

  
	
   

  	
  Lending Office for US Base Rate Loans and

  
	
   

  	
  LIBOR Loans:

  
	
   

  	
   

  
	
   

  	
  Union Bank of California, NA.

  
	
   

  	
  1980 Saturn Street, Mail Code V03-251

  
	
   

  	
  Monterey Park, CA 91755

  
	
   

  	
  E-mail: Maria.Suncin@uboc.com

  
	
   

  	
  Telephone: (323) 720-2870

  
	
   

  	
  Fax: (323) 720-2252/51

  



 


 


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  LENDER:

  	
  WELLS FARGO BANK, NA

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ 

  	
  T. Alan Smith

  	
   

  
	
   

  	
  Name: 

  	
  T. Alan Smith

  
	
   

  	
  Title:  Vice President

  
	
   

  	
   

  
	
   

  	
  Lending Office for [Base Rate Loans

  
	
   

  	
  and LIBOR Loans] [Canadian Prime Rate Loans and

  
	
   

  	
  Bankers’ Acceptances ]:

  
	
   

  	
   

  
	
   

  	
  Attention: Patricia Flores

  
	
   

  	
  Fax No.: 303.863.2729

  
	
   

  	
  Voice: 303.863.5183

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  1740 Broadway

  
	
   

  	
  Denver, Colorado 80274

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention: Patricia Flores

  
	
   

  	
  Telecopier No.: 303.863.2729

  
	
   

  	
   

  
	
   

  	
  With copy to: Philip C. Lauinger III and Sally
  Weir

  
	
   

  	
  Fax No: 713.739.1087

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention:

  
	
   

  	
  Telecopier No.:

  



 


 


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  BNP PARIBAS:

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/  

  	
  Larry Robinson

  	
   

  
	
   

  	
  Name: 

  	
  Larry Robinson

  
	
   

  	
  Title:  Director

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/  

  	
  Joe Onischuk

  	
   

  
	
   

  	
  Name: 

  	
  Joe Onischuk

  
	
   

  	
  Title:  Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention: CORY LANTIN

  
	
   

  	
  Telecopier No.: (212) 841-2683

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  919 THIRD AVENUE

  
	
   

  	
  NEW YORK, NY 10022

  
	
   

  	
   

  
	
   

  	
  Attention: GABRIEL CANDAMO

  
	
   

  	
  Telecopier No.: (212) 841-2683

  
	
   

  	
   

  
	
   

  	
  With copy to:

  
	
   

  	
   

  
	
   

  	
  Attention: LARRY ROBINSON

  
	
   

  	
  Telecopier No.: 713-659-6915

  
						



 


 


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  LENDER: SunTrust Bank

  	
   

  
	
   

  	
  By: 

  	
  /s/  

  	
  David Edge

  	
   

  
	
   

  	
  Name: 

  	
  David Edge

  
	
   

  	
  Title:  Managing Director

  
	
   

  	
   

  
	
   

  	
  Lending Office for US Base Rate Loans and

  
	
   

  	
  LIBOR Loans

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention: Joe McCreery

  
	
   

  	
  Telecopier No.: 404-827-6270

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  303 Peachtree Street, 10th Floor

  
	
   

  	
  Atlanta, GA 30308

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  With copy to:

  
	
   

  	
   

  
	
   

  	
  Tina Marie Edwards

  
	
   

  	
  303 Peachtree Street, 10th Floor

  
	
   

  	
  Atlanta, GA 30308

  



 


 


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  LENDER:

  	
  NATIONAL CITY BANK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ 

  	
  Stephen Monto

  	
   

  
	
   

  	
  Name: Stephen Monto

  
	
   

  	
  Title: Assistant Vice President

  
	
   

  	
   

  
	
   

  	
  Lending Office for US Base Rate Loans and

  
	
   

  	
  LIBOR Loans

  
	
   

  	
   

  
	
   

  	
  Attention: Stephen Monto

  
	
   

  	
  Telecopier No: 216-222-0003

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notices: National City Bank

  
	
   

  	
  1900 East 9th Street

  
	
   

  	
  Cleveland, OH 44114-3484

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention:

  
	
   

  	
  Telecopier No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  With copy to:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention:

  
	
   

  	
  Telecopier No.:

  



 


 


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  LENDER: NATEXIS BANQUES POPULAIRES

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
  /s/ Timothy Polvado

  	
   

  
	
   

  	
  Name: Timothy Polvado

  
	
   

  	
  Title:  Vice President / Manager

  
	
   

  	
   

  
	
   

  	
  By 

  	
   

  	
  /s/ Louis P. Laville, III

  	
   

  
	
   

  	
  Name: Louis P. Laville, III

  
	
   

  	
  Title: Vice President / Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office for US Base Rate Loans and

  
	
   

  	
  LIBOR Loans:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention: Tanya McAllister

  
	
   

  	
  Telecopier No.: 713-571-6165

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  Natexis Banques Populaires

  
	
   

  	
  333 Clay Street, #4340

  
	
   

  	
  Houston, TX 77002

  



 


 


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  LENDER: GUARANTY BANK

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
  /s/ Jim R. Hamilton

  	
   

  
	
   

  	
  Name: Jim R. Hamilton

  
	
   

  	
  Title: Senior Vice President

  
	
   

  	
   

  
	
   

  	
  Lending Office for [US Base Rate Loans and

  
	
   

  	
  LIBOR Loans]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention: Jim R. Hamilton

  
	
   

  	
  Telecopier No.: 210.930.1783

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  	
  1100 NE Loop 410

  
	
   

  	
   

  	
  Suite 700

  
	
   

  	
   

  	
  San Antonio, TX 78209

  
						



 


 


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  LENDER:

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
  /s/ Vaughn Buck

  	
   

  
	
   

  	
  Name: Vaughn Buck

  
	
   

  	
  Title: Senior Vice-President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
  /s/ Rob Moyle

  	
   

  
	
   

  	
  Name : Rob Moyle

  
	
   

  	
  Title: Vice-President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office for Allied Irish Banks, p.l.c.

  
	
   

  	
  Allied Irish Banks, p.l.c.

  
	
   

  	
  405 Park Avenue, 4th Floor

  
	
   

  	
  New York, New York 10022

  
	
   

  	
  Attention: David O’Driscoll/Mark Connelly

  
	
   

  	
  Telecopier No.: 212.339.8325

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
  Allied Irish Banks, p.l.c.

  
	
   

  	
  405 Park Avenue, 4th Floor

  
	
   

  	
  New York, New York 10022

  
	
   

  	
  Attention: David O’Driscoll/Mark Connelly

  
	
   

  	
  Telecopier No.: 212.339.8325

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  With copy to:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention:

  
	
   

  	
  Telecopier No.:

  



 


 


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  LENDER:

  	
  Southwest Bank of Texas, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
  /s/ William B. Pyle

  	
   

  
	
   

  	
  Name: William B. Pyle

  
	
   

  	
  Title: Senior Vice President

  
	
   

  	
   

  
	
   

  	
  Lending Office for US Base Rate Loans and 

  
	
   

  	
  LIBOR Loans/Canadian Prime Rate Loans and

  
	
   

  	
  Bankers’ Acceptances:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Southwest Bank of Texas

  
	
   

  	
  4400 Post Oak Parkway

  
	
   

  	
  Houston, Texas 77027

  
	
   

  	
   

  
	
   

  	
  Attention: Maxine Hunter

  
	
   

  	
  Telephone: 713-232-6355

  
	
   

  	
  Telecopier No.: 713-693-7467

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  Southwest Bank of Texas

  
	
   

  	
  P.O. Box 27459

  
	
   

  	
  Houston, Texas 77227

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention: Faye Cain 713-232-6363

  
	
   

  	
  Telecopier No.: 713-693-7467

  



 


 


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  LENDER:

  	
  JPMORGAN CHASE BANK, N.A., Toronto Branch

  
	
   

  	
  As Canadian Tranche Revolving Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
  /s/ J. Charles Freel, Jr.

  	
   

  
	
   

  	
  Name: J. Charles Freel, Jr.

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
  Lending Office for Canadian Prime Rate Loans,

  
	
   

  	
  Bankers’ Acceptances, US Base Rate Loans, and 

  
	
   

  	
  LIBOR Loans.

  
	
   

  	
   

  
	
   

  	
  Attention:

  	
  Indrani N. Lazarus

  
	
   

  	
   

  	
   

  
	
   

  	
  Telecopier No.:

  	
  416-981-9279

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  200 Bay Street Royal Bank Plaza

  
	
   

  	
   

  	
  South Tower, Suite 1800

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Toronto, ON M5J2J2

  
	
   

  	
   

  	
   

  
	
   

  	
  With copy to:

  	
  Michael Tam

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BCE Place, 161 Bay Street

  
	
   

  	
   

  	
  Suite 4240

  
	
   

  	
   

  	
  Toronto, Ontario M5J 2S1

  
	
   

  	
   

  	
   

  
	
   

  	
  Telecopier No.:

  	
  416-363-7574

  
						



 


 


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  LENDER:

  	
  DEUTSCHE BANK AG, CANADA

  
	
   

  	
  BRANCH

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
  /s/ Karyn Curran

  	
   

  
	
   

  	
  Name: Karyn Curran

  
	
   

  	
  Title:  Credit Product Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
  /s/ Robert A. Johnston

  	
   

  
	
   

  	
  Name: Robert A. Johnston

  
	
   

  	
  Title:  Vice-President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office for Canadian Prime Rate Loans 

  
	
   

  	
  and Bankers’ Acceptances:

  
	
   

  	
   

  
	
   

  	
  222 Bay Street, Suite 1100

  
	
   

  	
  P.O. Box 196

  
	
   

  	
  Toronto, Ontario M5K 1H6

  
	
   

  	
  Telecopier No.: (416) 682-8484

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  222 Bay Street, Suite 1100

  
	
   

  	
  P.O. Box 196

  
	
   

  	
  Toronto, Ontario M5K 1H6

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention: Marcellus Leung/Carmen Lam

  
	
   

  	
  Telecopier No.: (416) 682-8484

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  With copy to:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention: Karyn Curran

  
	
   

  	
  Telecopier No.: (416) 682-8444

  



 


 


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  LENDER:

  	
  THE BANK OF NOVA SCOTIA,

  
	
   

  	
  Canadian Lender

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
  /s/ Brian Williamson

  	
   

  
	
   

  	
  Name: Brian Williamson

  
	
   

  	
  Title: Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office Canadian Prime Rate

  
	
   

  	
  Loans and Bankers’ Acceptances:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Scotia Capital

  
	
   

  	
  2000, 700 — 2nd Street SW

  
	
   

  	
  Calgary, Alberta T2P 2N7

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telecopier No.: (403) 221-6497

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  The Bank of Nova Scotia

  
	
   

  	
  Calgary Commercial Banking Center

  
	
   

  	
  Transit #10009

  
	
   

  	
  240 - 8th Avenue SW

  
	
   

  	
  Calgary, Alberta T2P 2N7

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention: Diane Baker

  
	
   

  	
  Telecopier No.: (403) 221-6431

  



 


 


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  Bank of America, N.A.

  	
   

  
	
  (Canada Branch)

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Medina Sales de Andrade

  	
   

  
	
   

  	
  Name: Medina Sales de Andrade

  
	
   

  	
  Title: Assistant Vice-President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office for Canadian Tranche Loans:

  
	
   

  	
   

  
	
   

  	
  Bank of America NA. Canada Branch

  
	
   

  	
  200 Front Street, West, Suite 2700, Toronto,

  
	
   

  	
  Ontario, MSV 3L2

  
	
   

  	
   

  
	
   

  	
  Attention: Medina Sales de
  Andrade

  
	
   

  	
  Telecopier No.: 416-349-4283

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  Bank of America NA. Canada Branch

  
	
   

  	
  200 Front Street, West, Suite 2700, Toronto,

  
	
   

  	
  Ontario, MSV 3L2

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention: Domingo Braganza

  
	
   

  	
  Telecopier No.: 416-349-4283

  



 


 


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  LENDER:

  	
  COMERICA BANK, CANADA BRANCH

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
  /s/

  	
  Robert Rosen

  	
   

  
	
   

  	
  Name:  

  	
  Robert Rosen

  
	
   

  	
  Title: Vice-President

  
	
   

  	
   

  
	
   

  	
  Lending Office for Canadian Tranche Loans:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention: Robert Rosen

  
	
   

  	
  Telecopier No.: 416-367-2460

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  Suite 2210, South Tower,

  
	
   

  	
  Royal Bank Plaza

  
	
   

  	
  200 Bay Street, P.O. Box 61

  
	
   

  	
  Toronto, Ontario. M5J 2J2

  



 


 


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  LENDER:

  	
  Union Bank of California, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/

  	
  Dustin Gaspari

  	
   

  
	
   

  	
  Name: 

  	
  Dustin Gaspari

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
  Lending Office for Canadian Prime Rate Loans

  
	
   

  	
  and Bankers’ Acceptances:

  
	
   

  	
   

  
	
   

  	
  Union Bank of California, N.A.

  
	
   

  	
  Karen S. Anderson, Vice President

  
	
   

  	
  730 – 440 2nd Avenue SW

  
	
   

  	
  Calgary, AB T2P 5E9

  
	
   

  	
  Telephone:

  	
  403-264-2700

  
	
   

  	
  Fax:

  	
  403-264-2770

  
	
   

  	
  Email:

  	
  karens.anderson@uboc.com

  
	
   

  	
   

  
	
  Also notify 2nd Operations Contact:

  	
  Union Bank of California, N.A.

  
	
   

  	
  Miriam Hooker, Vice President

  
	
   

  	
  601 Potrero Grande Drive

  
	
   

  	
  Monterey Park, CA 91754

  
	
   

  	
  Telephone:

  	
  323-720-7397

  
	
   

  	
  Fax:

  	
  323-278-6173

  
	
   

  	
  Email:

  	
  miriam.hooker@uboc.com

  
						



 


 


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  BNP Paribas (Canada)

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
  /s/ Edward Pak

  	
   

  
	
   

  	
  Name: Edward Pak

  
	
   

  	
  Title: Assistant Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
  /s/ Michael Gosselin

  	
   

  
	
   

  	
  Name: Michael Gosselin

  
	
   

  	
  Title: Managing Director

  
	
   

  	
   

  
	
   

  	
  Lending Office for Canadian Prime Rate Loans

  
	
   

  	
  and Bankers’ Acceptances]:

  
	
   

  	
   

  
	
   

  	
  Attention:

  	
  Paule Fortin

  
	
   

  	
  Telecopier No.:

  	
  514-285-2944

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
  BNP Paribas (Canada)

  
	
   

  	
  1981 Avenue McGill College

  
	
   

  	
  Montreal, Quebec H3A 2W8

  
	
   

  	
   

  
	
   

  	
  Attention:

  	
  Paule Fortin

  
	
   

  	
  Telecopier No.:

  	
  514-285-2944

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  With copy to:

  
	
   

  	
   

  
	
   

  	
  BNP PARIBAS

  
	
   

  	
  1200 Smith Street, Suite 3100

  
	
   

  	
  Houston, Texas 77002

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention:

  	
  Larry Robinson

  
	
   

  	
  Telecopier No.:

  	
  713-659-6915

  
						



 


 


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  NATIONAL CITY BANK, CANADA BRANCH:

  	
   

  
	
  As Canadian Tranche
  Revolving Lender

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Caroline Stade  /s/ G. William Hines

  	
   

  	
   

  
	
   

  	
  Name: Caroline Stade

  	
  G. William Hines

  	
   

  
	
   

  	
  Title:

  	
  VP

  	
  SVP

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office for [US Base Rate Loans and

  
	
   

  	
  LIBOR Loans] [Canadian Prime Rate Loans and

  
	
   

  	
  Bankers’ Acceptances]:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attention: Caroline Stade

  
	
   

  	
   

  
	
   

  	
  Phone No.: 416 361-1744

  
	
   

  	
  Fax No.: 416 361-0085

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  National City Bank, Canada Branch

  
	
   

  	
  130 King Street West, Suite 2140

  
	
   

  	
  P.O. Box 462

  
	
   

  	
  Toronto, Ontario, CANADA

  
	
   

  	
  M5X 1E4

  
								



 


 


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ANNEX I

US TRANCHE COMMITMENTS 

AND PERCENTAGE SHARE


 


	
  US Tranche Revolving

  Lender

  	
   

  	
  US Tranche

  Commitment

  Amount if aggregate

  is $250M (in $)

  	
   

  	
  Initial US

  Tranche

  Commitment

  Amount (in $)

  	
   

  	
  US Tranche

  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Wachovia Bank, National Association

  	
   

  	
  $

  	
  24,000,000.00

  	
   

  	
  $

  	
  19,362,903.22

  	
   

  	
  8.605735

  	
  %

  
	
  JPMorgan Chase Bank, N.A.

  	
   

  	
  $

  	
  24,000,000.00

  	
   

  	
  $

  	
  19,362,903.22

  	
   

  	
  8.605735

  	
  %

  
	
  Deutsche Bank Trust Company Americas

  	
   

  	
  $

  	
  22,000,000.00

  	
   

  	
  $

  	
  19,043,010.75

  	
   

  	
  8.463560

  	
  %

  
	
  The Bank of Nova Scotia

  	
   

  	
  $

  	
  19,000,000.00

  	
   

  	
  $

  	
  16,446,236.56

  	
   

  	
  7.309438

  	
  %

  
	
  The Royal Bank of Scotland plc

  	
   

  	
  $

  	
  19,000,000.00

  	
   

  	
  $

  	
  19,000,000.00

  	
   

  	
  8.444444

  	
  %

  
	
  Bank of America, N.A.

  	
   

  	
  $

  	
  18,000,000.00

  	
   

  	
  $

  	
  15,580,645.16

  	
   

  	
  6.924731

  	
  %

  
	
  Comerica Bank

  	
   

  	
  $

  	
  17,000,000.00

  	
   

  	
  $

  	
  14,715,053.76

  	
   

  	
  6.540024

  	
  %

  
	
  Union Bank of California, N.A.

  	
   

  	
  $

  	
  17,000,000.00

  	
   

  	
  $

  	
  14,715,053.76

  	
   

  	
  6.540024

  	
  %

  
	
  Wells Fargo Bank, NA

  	
   

  	
  $

  	
  17,000,000.00

  	
   

  	
  $

  	
  17,000,000.00

  	
   

  	
  7.555556

  	
  %

  
	
  BNP Paribas

  	
   

  	
  $

  	
  12,000,000.00

  	
   

  	
  $

  	
  10,387,096.77

  	
   

  	
  4.616487

  	
  %

  
	
  SunTrust Bank

  	
   

  	
  $

  	
  12,000,000.00

  	
   

  	
  $

  	
  12,000,000.00

  	
   

  	
  5.333333

  	
  %

  
	
  National City Bank

  	
   

  	
  $

  	
  12,000,000.00

  	
   

  	
  $

  	
  10,387,096.77

  	
   

  	
  4.616487

  	
  %

  
	
  Natexis Banques Populares

  	
   

  	
  $

  	
  10,000,000.00

  	
   

  	
  $

  	
  10,000,000.00

  	
   

  	
  4.444444

  	
  %

  
	
  Guaranty Bank

  	
   

  	
  $

  	
  9,000,000.00

  	
   

  	
  $

  	
  9,000,000.00

  	
   

  	
  4.000000

  	
  %

  
	
  Allied Irish Banks, p.l.c.

  	
   

  	
  $

  	
  9,000,000.00

  	
   

  	
  $

  	
  9,000,000.00

  	
   

  	
  4.000000

  	
  %

  
	
  Southwest Bank of Texas, N.A.

  	
   

  	
  $

  	
  9,000,000.00

  	
   

  	
  $

  	
  9,000,000.00

  	
   

  	
  4.000000

  	
  %

  
	
  TOTAL

  	
   

  	
  $

  	
  250,000,000.00

  	
   

  	
  $

  	
  225,000,000.00

  	
   

  	
  100.000000

  	
  %

  



 


I – 1





















 


ANNEX II

CANADIAN ALLOCATED COMMITMENTS 

AND PERCENTAGE SHARE


 


	
  Canadian Tranche Revolving

  Lender

  	
   

  	
  Maximum

  Canadian Allocated

  Total Commitment

  Amount (in $)

  	
   

  	
  Canadian Tranche

  Percentage

  	
   

  
	
  Congress Financial Corporation (Canada)

  	
   

  	
  $

  	
  11,129,032.255

  	
   

  	
  18.548387

  	
  %

  
	
  JPMorgan Chase Bank, N.A., Toronto

  	
   

  	
  $

  	
  11,129,032.255

  	
   

  	
  18.548387

  	
  %

  
	
  Deutsche Bank AG, Canada Branch

  	
   

  	
  $

  	
  7,096,774.19

  	
   

  	
  11.827957

  	
  %

  
	
  The Bank of Nova Scotia

  	
   

  	
  $

  	
  6,129,032.26

  	
   

  	
  10.215054

  	
  %

  
	
  Bank of America, N.A.

  	
   

  	
  $

  	
  5,806,451.61

  	
   

  	
  9.677419

  	
  %

  
	
  Comerica Bank, Canada Branch

  	
   

  	
  $

  	
  5,483,870.97

  	
   

  	
  9.139785

  	
  %

  
	
  Union Bank of California, N.A.

  	
   

  	
  $

  	
  5,483,870.97

  	
   

  	
  9.139785

  	
  %

  
	
  BNP Paribas

  	
   

  	
  $

  	
  3,870,967.74

  	
   

  	
  6.451613

  	
  %

  
	
  National City Bank, Canada Branch

  	
   

  	
  $

  	
  3,870,967.74

  	
   

  	
  6.451613

  	
  %

  
	
  TOTAL

  	
   

  	
  $

  	
  60,000,000.00

  	
   

  	
  100.000000

  	
  %

  



 


II – 1





















 


ANNEX III

TERM COMMITMENTS

AND PERCENTAGE SHARE


 


	
  Term Loan

  Lender

  	
   

  	
  Maximum Term

  Commitment

  Amount (in $)

  	
   

  	
  Term Loan Percentage

  	
   

  
	
  Wachovia Bank, National Association

  	
   

  	
  $

  	
  357,250,000.00

  	
   

  	
  89.300

  	
  %

  
	
  JPMorgan Chase Bank, N.A.

  	
   

  	
  $

  	
  2,250,000.00

  	
   

  	
  0.575

  	
  %

  
	
  The Bank of Nova Scotia

  	
   

  	
  $

  	
  6,500,000.00

  	
   

  	
  1.625

  	
  %

  
	
  The Royal Bank of Scotland plc

  	
   

  	
  $

  	
  5,000,000.00

  	
   

  	
  1.250

  	
  %

  
	
  BNP Paribas

  	
   

  	
  $

  	
  5,000,000.00

  	
   

  	
  1.250

  	
  %

  
	
  SunTrust Bank

  	
   

  	
  $

  	
  5,000,000.00

  	
   

  	
  1.250

  	
  %

  
	
  National City Bank

  	
   

  	
  $

  	
  5,000,000.00

  	
   

  	
  1.250

  	
  %

  
	
  Guaranty Bank

  	
   

  	
  $

  	
  4,500,000.00

  	
   

  	
  1.125

  	
  %

  
	
  Natexis Banques Populares

  	
   

  	
  $

  	
  3,500,000.00

  	
   

  	
  0.875

  	
  %

  
	
  Allied Irish Banks, p.l.c.

  	
   

  	
  $

  	
  3,000,000.00

  	
   

  	
  0.750

  	
  %

  
	
  Southwest Bank of Texas, N.A.

  	
   

  	
  $

  	
  3,000.000.00

  	
   

  	
  0.750

  	
  %

  
	
  TOTAL

  	
   

  	
  $

  	
  400,000,000.00

  	
   

  	
  100.000

  	
  %

  



 


III – 1





















 


EXHIBIT A-1

FORM OF US REVOLVING NOTE


 




	
  $

  	
                                               

  	
   

  	
                           

  	
  , 2005

  






 


FOR VALUE RECEIVED, UNIVERSAL COMPRESSION, INC., a
Texas corporation and UNIVERSAL COMPRESSION HOLDINGS, INC., a Delaware
corporation (collectively, the “US Borrower”), jointly and severally
hereby promise to pay to the order of                               
(the “Lender”), at the principal office of WACHOVIA BANK, NATIONAL
ASSOCIATION, as the US Administrative Agent (the “US Administrative
Agent”), at 301 South College Street, Charlotte, North Carolina 28288-0608,
the principal sum of                              
US Dollars ($            )
(or such lesser amount as shall equal the aggregate unpaid principal amount of
the US Tranche Loans made by the Lender to the US Borrower under the Credit
Agreement, as hereinafter defined), in lawful money of the United States of
America and in immediately available funds, on the dates and in the principal
amounts provided in the Credit Agreement, and to pay interest on the unpaid
principal amount of each such US Tranche Loan, at such office, in like money
and funds, for the period commencing on the date of such US Tranche Loan until
such US Tranche Loan shall be paid in full, at the rates per annum and on the
dates provided in the Credit Agreement.


 


The date, amount, Type, interest rate, Interest Period
and maturity of each US Tranche Loan made by the Lender to the US Borrower, and
each payment made on account of the principal thereof, shall be recorded by the
Lender on its books and, prior to any transfer of this Note, endorsed by the
Lender on the schedules attached hereto or any continuation thereof.


 


This Note is one of the Notes referred to in the
Senior Secured Credit Agreement dated as of January 14, 2005, among the US
Borrower, UC Canadian Partnership Holdings Company, a Nova Scotia ULC, as the
Canadian Borrower, the US Administrative Agent, Congress Financial Corporation
(Canada), as the Canadian Administrative Agent and the Lenders which are or
become parties thereto (including the Lender) (as the same may be amended or
supplemented from time to time, the “Credit Agreement”), and evidences
US Tranche Loans made by the Lender thereunder. 
Capitalized terms used in this Note and not defined herein have the
respective meanings assigned to them in the Credit Agreement.


 


This Note is issued pursuant to the Credit Agreement
and is entitled to the benefits provided for in the Credit Agreement and the
Security Instruments.  The Credit
Agreement provides for the acceleration of the maturity of this Note upon the
occurrence of certain events and for prepayments of US Tranche Loans upon the
terms and conditions specified therein and other provisions relevant to this
Note.


 


A-1 – 1





















 


THIS NOTE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS.


 


	
   

  	
  UNIVERSAL COMPRESSION, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  UNIVERSAL COMPRESSION HOLDINGS,
  INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
							



 


A-1 – 2





















 


EXHIBIT A-2

FORM OF CANADIAN REVOLVING NOTE


 




	
  $

  	
                                                

  	
   

  	
                         

  	
  , 2005

  






 


FOR VALUE RECEIVED, UC CANADIAN PARTNERSHIP HOLDINGS
COMPANY, a Nova Scotia ULC (the “Canadian Borrower”), hereby promises to
pay to the order of                               
(the “Lender”), at the principal office of CONGRESS FINANCIAL
CORPORATION (CANADA), as the Canadian Administrative Agent (the “Canadian
Administrative Agent”), at 141 Adelaide Street W., Suite 1500, Toronto,
Ontario, Canada M5G 3L9, the principal sum of                                        
US Dollars ($            )
(or such lesser amount as shall equal the aggregate unpaid principal amount of
the Canadian Tranche Loans made by the Lender to the Canadian Borrower under
the Credit Agreement, as hereinafter defined), in lawful money of Canada or the
United States, as the case may be, and in immediately available funds, on the
dates and in the principal amounts and currency provided in the Credit
Agreement, and to pay interest on the unpaid principal amount of each such
Canadian Tranche Loan, at such office, in like money and funds, for the period
commencing on the date of such Canadian Tranche Loan until such Canadian
Tranche Loan shall be paid in full, at the rates per annum and on the dates
provided in the Credit Agreement.


 


The date, amount, Type, interest rate, Interest
Period, currency and maturity of each Canadian Tranche Loan made by the Lender
to the Canadian Borrower, and each payment made on account of the principal
thereof, shall be recorded by the Lender on its books and, prior to any
transfer of this Note, endorsed by the Lender on the schedules attached hereto
or any continuation thereof.


 


This Note is one of the Notes referred to in the
Senior Secured Credit Agreement dated as of January 14, 2005, among
Universal Compression, Inc., a Texas corporation and Universal Compression
Holdings, Inc., a Delaware corporation, collectively, as the US Borrower, the
Canadian Borrower, Wachovia Bank, National Association, as the US
Administrative Agent, the Canadian Administrative Agent and the Lenders which
are or become parties thereto (including the Lender) (as the same may be
amended or supplemented from time to time, the “Credit Agreement”), and
evidences Canadian Tranche Loans made by the Lender thereunder.  Capitalized terms used in this Note and not
defined herein shall have the respective meanings assigned to them in the
Credit Agreement.


 


This Note is issued pursuant to the Credit Agreement
and is entitled to the benefits provided for in the Credit Agreement and the
Security Instruments.  The Credit
Agreement provides for the acceleration of the maturity of this Note upon the
occurrence of certain events and for prepayments of Canadian Tranche Loans upon
the terms and conditions specified therein and other provisions relevant to
this Note.


 


A-2 – 1





















 


THIS NOTE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS.


 


	
   

  	
  UC CANADIAN PARTNERSHIP
  HOLDINGS COMPANY

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


A-2 – 2





















 


EXHIBIT A-3

FORM OF TERM NOTE


 




	
  $

  	
                                                

  	
   

  	
                         

  	
  , 2005

  






 


FOR VALUE RECEIVED, UNIVERSAL COMPRESSION, INC., a
Texas corporation and UNIVERSAL COMPRESSION HOLDINGS, INC., a Delaware
corporation (collectively, the “US Borrower”), jointly and severally
hereby promise to pay to the order of                              
(the “Lender”), at the principal office of WACHOVIA BANK, NATIONAL
ASSOCIATION, as the US Administrative Agent (the “US
Administrative Agent”), at 301 South College Street, Charlotte, North
Carolina 28288-0608, the principal sum of                             
US Dollars ($            )
(or such lesser amount as shall equal the aggregate unpaid principal amount of
the Term Loans made by the Lender to the US Borrower under the Credit
Agreement, as hereinafter defined), in lawful money of the United States of
America and in immediately available funds, on the dates and in the principal
amounts provided in the Credit Agreement, and to pay interest on the unpaid
principal amount of such Term Loan, at such office, in like money and funds,
for the period commencing on the date of such Term Loan until such Term Loan
shall be paid in full, at the rates per annum and on the dates provided in the
Credit Agreement.


 


The date, amount, Type, interest rate, Interest Period
and maturity of each Term Loan made by the Lender to the US Borrower, and each
payment made on account of the principal thereof, shall be recorded by the
Lender on its books and, prior to any transfer of this Note, endorsed by the
Lender on the schedules attached hereto or any continuation thereof.


 


This Note is one of the Notes referred to in the
Senior Secured Credit Agreement dated as of January 14, 2005, among the US
Borrower, UC Canadian Partnership Holdings Company, a Nova Scotia ULC, as the
Canadian Borrower, the US Administrative Agent, Congress Financial Corporation
(Canada), as the Canadian Administrative Agent and the Lenders which are or
become parties thereto (including the Lender) (as the same may be amended or supplemented
from time to time, the “Credit Agreement”), and evidences the Term Loan
made by the Lender thereunder. 
Capitalized terms used in this Note and not defined herein shall have
the respective meanings assigned to them in the Credit Agreement.


 


This Note is issued pursuant to the Credit Agreement
and is entitled to the benefits provided for in the Credit Agreement and the
Security Instruments.  The Credit
Agreement provides for the acceleration of the maturity of this Note upon the
occurrence of certain events and for prepayments of the Term Loan upon the
terms and conditions specified therein and other provisions relevant to this
Note.


 


A-3 – 1





















 


THIS NOTE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS.


 


	
   

  	
  UNIVERSAL COMPRESSION, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  UNIVERSAL COMPRESSION
  HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
							



 


A-3 – 2





















 


EXHIBIT A-4

FORM OF BA EQUIVALENT NOTE


 




	
  $

  	
                                                

  	
   

  	
                          

  	
  , 2005

  






 


FOR VALUE RECEIVED, UC CANADIAN PARTNERSHIP HOLDINGS
COMPANY, a Nova Scotia ULC (the “Canadian Borrower”), hereby promises to
pay to the order of                               
(the “Lender”), at the principal office of CONGRESS FINANCIAL
CORPORATION (CANADA), as the Canadian Administrative Agent (the “Canadian
Administrative Agent”), at 141 Adelaide Street W., Suite 1500, Toronto,
Ontario, Canada M3H 3L9, the principal sum of                                        
Canadian Dollars (C$            ),
in lawful money of Canada and in immediately available funds, on                  ,
       .


 


This BA Equivalent Note is one of the BA Equivalent
Notes referred to in the Senior Secured Credit Agreement dated as of
January 14, 2005, among the Universal Compression, Inc., a Texas
corporation and Universal Compression Holdings, Inc., a Delaware corporation,
collectively, as US Borrower, the Canadian Borrower, Wachovia Bank, National
Association as the US Administrative Agent, the Canadian Administrative Agent
and the Lenders which are or become parties thereto (including the Lender) (as
the same may be amended or supplemented from time to time, the “Credit
Agreement”), and evidences BA Equivalent Loans made by the Lender
thereunder.  Capitalized terms used in
this BA Equivalent Note and not defined herein shall have the respective
meanings assigned to them in the Credit Agreement.


 


This BA Equivalent Note is issued pursuant to the
Credit Agreement and is entitled to the benefits provided for in the Credit
Agreement and the Security Instruments. 
The Credit Agreement provides for the acceleration of the maturity of
this BA Equivalent Note upon the occurrence of certain events and for
prepayments of BA Equivalent Loans upon the terms and conditions specified
therein.


 


THIS BA EQUIVALENT NOTE SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS.


 


 


	
   

  	
  UC CANADIAN PARTNERSHIP
  HOLDINGS COMPANY

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


A-4 – 1





















 


EXHIBIT B - 1

FORM OF US BORROWING, CONTINUATION AND CONVERSION REQUEST


 


               ,
20  


 


UNIVERSAL COMPRESSION, INC., a Texas corporation, and
UNIVERSAL COMPRESSION HOLDINGS, INC., a Delaware corporation (collectively, the
“US Borrower”), pursuant to the Senior Secured Credit Agreement dated as
of January 14, 2005, among the US Borrower, UC CANADIAN PARTNERSHIP
HOLDINGS COMPANY, a Nova Scotia ULC, as Canadian Borrower, WACHOVIA BANK,
NATIONAL ASSOCIATION, as US Administrative Agent, CONGRESS FINANCIAL
CORPORATION (CANADA), as Canadian Administrative Agent, and such Lenders party
thereto (as the same may be amended or supplemented from time to time, the “Credit
Agreement”), hereby make the requests indicated below (unless otherwise
defined herein, capitalized terms are defined in the Credit Agreement):


 


1.                                       US
Tranche Loans:


 


(a)                                  Aggregate
amount of new US Tranche Loans to be borrowed is $                      ;


 


(b)                                 Requested
funding date is                  ,
         ;


 


(c)                                  $                     
of such US Tranche Borrowings are to be US Dollar Base Rate Loans;


 


(d)                                 $                     
of such US Tranche Borrowings are to be US Dollar LIBOR Loans; and


 


(i)                                     Length
of Interest Period for US Dollar LIBOR Loans is:                          .


 


(e)                                  The
location and number of the account is:


 


                                                                                                                              .


 


2.                                       US
Dollar LIBOR Loan Continuation/Conversion for US Dollar LIBOR Loans maturing on
                     :


 


(a)                                  Aggregate
amount to be continued as US Dollar LIBOR Loans is $                    ;
and


 


(i)                                     Length
of Interest Period for continued US Dollar LIBOR Loans is                                 .


 


(b)                                 Aggregate
amount to be converted to US Dollar Base Rate Loans is $                             .


 


B-1 – 1





















 


3.                                       Conversion
of outstanding US Dollar Base Rate Loans to US Dollar LIBOR Loans:


 


(a)                                  Convert
$                  
of the outstanding US Dollar Base Rate Loans to US Dollar LIBOR Loans on                     
with an Interest Period of                       .


 


The undersigned certifies that he is the                      
of                  ,
and that as such he is authorized to execute this certificate on behalf of                  .  The undersigned further certifies, represents
and warrants on behalf of                  
that                  
is entitled to receive the requested Borrowing, continuation or conversion
under the terms and conditions of the Credit Agreement.


 


	
   

  	
  [UNIVERSAL COMPRESSION, INC./

  UNIVERSAL COMPRESSION HOLDINGS,

  INC.]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


B-1 – 2





















 


EXHIBIT B - 2

FORM OF CANADIAN BORROWING, CONTINUATION AND CONVERSION REQUEST


 


               ,
20  


 


UC CANADIAN PARTNERSHIP HOLDINGS COMPANY, a Nova
Scotia ULC (the “Canadian Borrower”), pursuant to the Senior Secured
Credit Agreement dated as of January 14, 2005, among the Canadian
Borrower, UNIVERSAL COMPRESSION, INC., a Texas corporation and UNIVERSAL
COMPRESSION HOLDINGS, INC. a Delaware corporation, collectively as the US
Borrowers, WACHOVIA BANK, NATIONAL ASSOCIATION, as US Administrative
Agent, CONGRESS FINANCIAL CORPORATION (CANADA), as Canadian Administrative
Agent, and such Lenders party thereto (as the same may be amended or
supplemented from time to time, the “Credit Agreement”), hereby makes
the requests indicated below (unless otherwise defined herein, capitalized
terms are defined in the Credit Agreement):


 


1.                                       New
Canadian Tranche Loans:


 


(a)                                  Aggregate
amount of new Canadian Tranche Loans to be borrowed is $                      ;


 


(b)                                 Requested
funding date is                            ,
           ;


 


(c)                                  $                     
of such Canadian Tranche Borrowings are to be US Dollar Base Rate Loans;


 


(d)                                 $                     
of such Canadian Tranche Borrowings are to be US Dollar LIBOR Loans;


 


(i)                                     Length
of Interest Period for US Dollar LIBOR Loans is:                          .


 


(e)                                  $                     
of such Canadian Tranche Borrowings are to be Canadian Prime Rate Loans;


 


(f)                                    $                     
of such Canadian Tranche Borrowings are to be Bankers’ Acceptances or BA
Equivalent Loans; and


 


(i)                                     The
Acceptance Date with respect to Bankers’ Acceptances and BA Equivalent Loans
is:                           ;
and


 


(ii)                                  The
maturity date with respect to Bankers’ Acceptances and BA Equivalent Loans is
(integral multiples of 30 days up to 180 days from the Acceptance Date):                                        .


 


(g)                                 The
location and number of the account is:


 


                                                                                                                                       .


 


B-2 – 1





















 


2.                                       US
Dollar LIBOR Loan Continuation/Conversion for US Dollar LIBOR Loans maturing on
                     :


 


(a)                                  Aggregate
amount to be continued as US Dollar LIBOR Loans is $                    ;


 


(i)                                     Length
of Interest Period for continued US Dollar LIBOR Loans is                         .


 


(b)                                 Aggregate
amount to be converted to US Dollar Base Rate Loans is $                    ;


 


(c)                                  Aggregate
amount to be converted to Canadian Prime Rate Loans is $                    ;
and


 


(d)                                 Aggregate
amount to be converted to Bankers’ Acceptances or BA Equivalent Loans is $                    .


 


(i)            The
Acceptance Date with respect to Bankers’ Acceptances and BA Equivalent Loans
is:                           ;
and


 


(ii)           The
maturity date with respect to Bankers’ Acceptances and BA Equivalent Loans is
(integral multiples of 30 days up to 180 days from the Acceptance Date):                           .


 


3.                                       US
Dollar Base Rate Loan Conversion for US Dollar Base Rate Loans:


 


(a)                                  Aggregate
amount to be converted to US Dollar LIBOR Loans is: $                    ;


 


(i)                                     Length
of Interest Period for continued US Dollar LIBOR Loans is                         .


 


(b)                                 Aggregate
amount to be converted to Canadian Prime Rate Loans is $                    ;
and


 


(c)                                  Aggregate
amount to be converted to Bankers’ Acceptances or BA Equivalent Loans is $                    .


 


(i)            The
Acceptance Date with respect to Bankers’ Acceptances and BA Equivalent Loans
is:                           ;
and


 


(ii)           The
maturity date with respect to Bankers’ Acceptances and BA Equivalent Loans is
(integral multiples of 30 days up to 180 days from the Acceptance Date):                           .


 


4.                                       Canadian
Prime Rate Loan Conversion for Canadian Prime Rate Loans:


 


B-2 – 2





















 


(a)                                  Aggregate
amount to be converted to Bankers’ Acceptances or BA Equivalent Loans is $                    .


 


(i)            The
Acceptance Date with respect to Bankers’ Acceptances and BA Equivalent Loans
is:                           ;
and


 


(ii)           The
maturity date with respect to Bankers’ Acceptances and BA Equivalent Loans is
(integral multiples of 30 days up to 180 days from the Acceptance Date):                           .


 


(b)                                 Aggregate
amount to be converted to US Dollar LIBOR Loans is $                    ;
and


 


(i)            Length
of Interest Period for converted US Dollar LIBOR Loans is                               .


 


(c)                                  Aggregate
amount to be converted to US Dollar Base Rate Loans is $                          ;


 


4.                                       Bankers’
Acceptances and BA Equivalent Loan Conversion for Bankers’ Acceptances and BA
Equivalent Loans with a maturity date of                         :


 


(a)                                  Aggregate
amount to be converted to Canadian Prime Rate Loans is $                              .


 


B-2 – 3





















 


The undersigned certifies that he is the                      
of the Canadian Borrower, and that as such he is authorized to execute this
certificate on behalf of the Canadian Borrower. 
The undersigned further certifies, represents and warrants on behalf of
the Canadian Borrower that the Canadian Borrower is entitled to receive the
requested Borrowing, continuation or conversion under the terms and conditions
of the Credit Agreement.


 


	
   

  	
  UC CANADIAN PARTNERSHIP
  HOLDINGS COMPANY

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


B-2 – 4





















 


EXHIBIT C-1

FORM OF COMPLIANCE CERTIFICATE


 


The undersigned hereby certifies that he is the                 
of [UNIVERSAL COMPRESSION, INC., a Texas corporation (“UCI”)] [UNIVERSAL
COMPRESSION HOLDINGS, INC., a Delaware corporation (“Holdings”)]
and that as such he is authorized to execute this certificate on behalf of
[UCI] [Holdings].  With reference to the
Senior Secured Credit Agreement dated as of January 14, 2005, among
Universal Compression, Inc., a Texas corporation and Universal Compression
Holdings, Inc., a Delaware corporation (collectively, the “US Borrowers”), UC Canadian Partnership
Holdings Company, a Nova Scotia ULC (the “Canadian Borrower”), Wachovia
Bank, National Association, as US Administrative Agent (the “US
Administrative Agent”), Congress Financial Corporation (Canada), as the
Canadian Administrative Agent (the “Canadian Administrative Agent”), and
such Lenders party thereto (as the same may be amended or supplemented from
time to time, the “Credit Agreement”), the undersigned represents and
warrants as follows (each capitalized term used herein having the same meaning
given to it in the Credit Agreement unless otherwise specified):


 


(a)           The representations and warranties of
each US Borrower and the Canadian Borrower contained in ARTICLES VII and
VIII of the Credit Agreement and in the Security Instruments were true and
correct when made, and are repeated at and as of the time of delivery hereof
and are true and correct at and as of the time of delivery hereof, except as
such representations and warranties are expressly limited to an earlier date or
are modified to give effect to the transactions expressly permitted by the
Credit Agreement.


 


(b)           Each US Borrower and the Canadian
Borrower has performed and complied with all agreements and conditions
contained in the Credit Agreement and in the Security Instruments required to
be performed or complied with by it prior to or at the time of delivery hereof.


 


(c)           Since September 30, 2004, there has
been no change or event having a Material Adverse Effect.


 


(d)           No Default has occurred and is continuing
under the Credit Agreement.


 


C-1 – 1





















 


EXECUTED AND
DELIVERED this      day of               .


 


	
   

  	
  [UNIVERSAL COMPRESSION, INC./
  UNIVERSAL COMPRESSION HOLDINGS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


C-1 – 2





















 


EXHIBIT C-2

FORM OF COMPLIANCE CERTIFICATE


 


The undersigned hereby certifies that he is the                 
of UNIVERSAL COMPRESSION, INC., a Texas corporation (“UCI”) and that as such he is authorized as a
Responsible Officer to execute this certificate on behalf of UCI.  With reference to the Senior Secured Credit
Agreement dated as of January 14, 2005, among Universal Compression, Inc.,
a Texas corporation and Universal Compression Holdings, Inc., a Delaware
corporation (“Holdings” and together with UCI, the “US Borrowers”), UC Canadian Partnership
Holdings Company, a Nova Scotia ULC (the “Canadian Borrower”), Wachovia
Bank, National Association, as US Administrative Agent (the “US
Administrative Agent”), Congress Financial Corporation (Canada), as the
Canadian Administrative Agent (the “Canadian Administrative Agent”), and
such Lenders party thereto (as the same may be amended or supplemented from
time to time, the “Credit Agreement”), the undersigned represents and
warrants as follows (each capitalized term used herein having the same meaning
given to it in the Credit Agreement unless otherwise specified):


 


(a)           No Default has occurred and is
continuing under the Credit Agreement.


 


(b)           The financial statements furnished to
the US Administrative Agent with this certificate fairly present the
consolidated financial condition and results of operations of Holdings and its
Consolidated Subsidiaries as at the end of, and for, the [fiscal quarter]
[fiscal year] ending                          
and such financial statements have been approved in accordance with the
accounting procedures specified in the Credit Agreement.


 


(c)           Attached hereto are the detailed
computations necessary to determine whether Holdings and its Consolidated
Subsidiaries are in compliance with Section 10.13 of the Credit Agreement
as of the end of the [fiscal quarter] [fiscal year] ending                          .


 


EXECUTED AND DELIVERED this      day of               .


 


	
   

  	
  UNIVERSAL COMPRESSION, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


C-2 – 1





















 


EXHIBIT D

Senior Security Instruments


 


1.                                       Collateral
Agreement dated as of January 14, 2005 among the US Borrowers and the US
Administrative Agent, as amended, modified or restated from time to time (the “Collateral
Agreement”), covering:


 


a.                                       UCI’s
pledge of 100% of the stock of the following direct Domestic Subsidiaries:


 


(i)                                     Universal
Compression International, Inc.


(ii)                                  Compressor
Systems International, Inc.


 


b.                                      UCI’s
pledge of 65% of the stock of first tier Foreign Subsidiaries:


 


(i)            None


 


c.                                       Holdings’
pledge of 100% of the stock of the following direct Domestic Subsidiaries:


 


(i)                                     Universal
Compression, Inc. (to be pledged on the Term Loan Funding Date)


 


d.                                      Holdings’
pledge of 65% of the stock of first tier Foreign Subsidiaries:


 


(i)            None


 


e.                                       Holdings’
and each Subsidiaries’ accounts, chattel paper, documents, equipment, general
intangibles, instruments and inventory, all books and records pertaining to the
foregoing and proceeds.


 


2.                                       UCC
Financing Statements for Holdings (to be filed on the Term Loan Funding Date)
and UCI relating to Item 1.


 


3.                                       Stock
Powers relating to stock pledged in Item 1.


 


4.                                       Original
certificates representing stock pledged in Item 1:


 


a.                                       Stock
Certificate No. 1 for 100 shares in the name of Universal Compression
International, Inc. issued to Universal Compression, Inc.


 


b.                                      Stock
Certificate No. 2 for 1,500 shares of Compressor Systems International, Inc.
issued to Universal Compression, Inc.


 


5.                                       Pledge
and Security Agreement (Pledge and Assignment), dated January 14, 2005
among Universal Compression International, Inc., Enterra Compression Investment
Company, Universal Compression Services, LLC and Universal Compression Canadian
Holdings, Inc. covering:


 


a.                                       100%
of the stock of the following domestic subsidiaries:


 


D – 1





















 


(i)            Enterra Compression Investment
Company

(ii)           UCO Compression Holding,
L.L.C.

(iii)          Universal Compression Services,
LLC

(iv)          Universal Compression
Canadian Holdings, Inc.


 


b.                                      65%
(except where noted) of the stock of the following foreign subsidiaries:


 


(i)            Universal Compression International
Ltd.

(ii)           Compression Services de
Mexico, S.A. de C.V.

(iii)          Universal Compression de
Mexico, S.A. de C.V.

(iv)          Universal Compression de
Venezuela Unicom, C.A.

(v)           Universal Compression
(Ontario) Ltd.

(vi)          Universal Compression
Services de Venezuela, C.A.

(vii)         Universal Compression
(Australia) Pty Ltd


 


6.                                       Stock
Powers


 


7.                                       UCC
Financing Statements relating to capital stock pledged in Item 5.


 


8.                                       Original
certificates representing capital stock pledged in Item 5:


 


a.


 


(i)            Stock
Certificate No. 4 for 1,002 shares of Enterra Compression Investment Company
issued to Universal Compression International, Inc.


 


(ii)           Stock
Certificates No. 3 and 4 for 640 shares and 360 shares, respectively, of UCO
Compression Holding, L.L.C. issued to Enterra Compression Investment Company


 


(iii)          Stock
Certificates No. 6 and 7 for 3,600 shares and 6,400 shares, respectively, of
Universal Compression Services, LLC issued to Enterra Compression Investment
Company


 


(iv)          Stock
Certificate No. 2 for 100 shares of Universal Compression Canadian Holdings,
Inc. issued to Enterra Compression Investment Company


 


b.


 


(i)            Stock
Certificate No. 4 for 65 shares of Universal Compression International Ltd.
issued to Universal Compression International, Inc.


 


(ii)           Stock
Certificate No. 1 for 97,500 shares of Compression Services de Mexico, S.A. de
C.V. issued to Universal Compression International, Inc.


 


(iii)          Stock
Certificate No. 3 for 32,500 shares of Universal Compression de Mexico, S.A. de
C.V. issued to Universal Compression International, Inc.


 


D – 2





















 


(iv)          Stock
Certificate No. 1 for 35,186,328 shares of Universal Compression De Venezuela
Unicom, C.A. issued to Universal Compression International, Inc.


 


(v)           Stock
Certificate No. 5 for 46,216,501 shares of Universal Compression (Ontario) Ltd.
issued to Universal Compression Canadian Holdings, Inc.


 


(vi)          Stock
Certificate No. 1 for 2,317,657 shares of Universal Compression Services de
Venezuela, C.A. issued to Universal Compression Services, LLC (formerly
Universal Compression Services, L.P.)


 


(vii)         Stock
Certificate No. 2 for 65 shares of Universal Compression (Australia) Pty Ltd
issued to Universal Compression Services, LLC (formerly Universal Compression
Services, L.P.)


 


9.             Deed of Trust, Security Agreement,
Assignment of Rents and Leases, Fixture Filing and Financing Statement, dated
February 15, 2005 executed by Universal Compression, Inc., covering that certain real property
located at 4444 Brittmoore Road, Houston, Texas 77041 (to be executed on the
Term Loan Funding Date)


 


10.           Guarantee and Collateral Agreement (to
be executed by any Significant Domestic Subsidiary pursuant to Section
9.09(a) of the Credit Agreement)


 


D – 3





















 


EXHIBIT E

FORM OF ASSIGNMENT AGREEMENT


 


NOTE: IF
ASSIGNOR OR A BRANCH OR AN AFFILIATE OF ASSIGNOR IS A LENDER UNDER A US TRANCHE
COMMITMENT OR A CANADIAN TRANCHE COMMITMENT, SUCH AFFILIATE MUST ASSIGN AN
EQUAL PRO RATA AMOUNT OF ITS RESPECTIVE COMMITMENT PURSUANT TO THIS FORM.


 


ASSIGNMENT AGREEMENT (“Agreement”) dated as of               ,
                       between:                                   
(the “Assignor”) and                           
(the “Assignee”).


 


RECITALS


 


A.            The
Assignor is a party to the Senior Secured Credit Agreement dated as of
January    , 2005 (as the same may be amended or
supplemented from time to time, the “Credit Agreement”) among Universal
Compression, Inc., a Texas corporation and Universal Compression Holdings, Inc,
a Delaware corporation (collectively, the “US Borrowers”, and in their
capacity as guarantor of the Canadian Borrower, the “Guarantor”); UC
Canadian Partnership Holdings Company, a Nova Scotia ULC (the “Canadian
Borrower”); Wachovia Bank, National Association, individually and as US
Administrative Agent (herein, together with its successors in such capacity,
the “US Administrative Agent”); Congress Financial Corporation (Canada),
individually and as Canadian Administrative Agent (herein, together with its
successors in such capacity, the “Canadian Administrative Agent”);
JPMorgan Chase Bank, N.A., individually and as Syndication Agent (herein,
together with its successors in such capacity, the “Syndication Agent”);
and each of the lenders that is a signatory hereto or which becomes a signatory
hereto pursuant to Section 13.06 (individually, together with its
successors and assigns, a “Lender” and, collectively, the “Lenders”).


 


B.            The
Assignor proposes to sell, assign and transfer to the Assignee, and the
Assignee proposes to purchase and assume from the Assignor, the Assigned
Interests, all on the terms and conditions of this Agreement.


 


C.            In
consideration of the foregoing and the mutual agreements contained herein, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:


 


ARTICLE I

Definitions.


 


Section 1.01           Definitions.  All capitalized terms used but not defined
herein have the respective meanings given to such terms in the Credit
Agreement.


 


Section 1.02           Other
Definitions.  As used herein, the
following terms have the following respective meanings:


 


“Assigned Interest” shall mean:


 


E – 1





















 


	
  US Tranche
  Commitment

  	
  $                                  

  	
   

  
	
   

  	
   

  
	
  Canadian
  Allocated Maximum Total Commitment

  	
  $                                  

  	
   

  
	
   

  	
   

  
	
  Canadian
  Allocated Commitment

  	
  $                                   

  	
   

  
	
   

  	
   

  	
   

  
	
  [Note: the
  Assignment must assign equal pro rata interests in each Tranche if Assignor
  its branch or Affiliate has an interest in each Revolving Tranche]

  
	
   

  
	
  US Tranche
  Credit Exposure:

  
	
   

  	
   

  
	
  US Dollar
  LIBOR Loans

  	
  $                                   outstanding

  
	
   

  	
   

  
	
  US Base Rate
  Loans

  	
  $                                   outstanding

  
	
   

  	
   

  
	
  LC Exposure

  	
  $                                   outstanding

  
	
   

  	
   

  
	
  Canadian
  Tranche Credit Exposure:

  	
   

  
	
   

  	
   

  
	
  Canadian
  Prime Rate Loans

  	
  C$                                outstanding

  
	
   

  	
   

  
	
  US Dollar
  Base Rate Loans

  	
  $                                   outstanding

  
	
   

  	
   

  
	
  US Dollar
  LIBOR Loans

  	
  $                                   outstanding

  



 


	
  Bankers’ Acceptances
  or BA Equivalent Loans

  	
  C$                               outstanding

  
	
   

  	
   

  
	
  Term Credit
  Exposure:

  	
   

  
	
   

  	
   

  
	
  US Dollar
  Base Rate Loans

  	
  $                                   outstanding

  
	
   

  	
   

  
	
  US Dollar
  LIBOR Loans

  	
  $                                   outstanding

  



 


	
  “Assignment
  Date” shall mean
                       ,
           .

  



 


ARTICLE II

Sale and Assignment.


 


Section 2.01           Sale
and Assignment.  On the terms and
conditions set forth herein, effective on and as of the Assignment Date, the
Assignor hereby sells, assigns and transfers to the Assignee, and the Assignee
hereby purchases and assumes from the Assignor, all of the right, title and
interest of the Assignor in and to, and all of the obligations of the Assignor
in respect of, the Assigned Interest. 
Such sale, assignment and transfer is without recourse and, except as
expressly provided in this Agreement, without representation or warranty.


 


E – 2





















 


Section 2.02           Assumption
of Obligations.  The Assignee agrees
with the Assignor (for the express benefit of the Assignor and the Applicable
Borrower) that the Assignee will, from and after the Assignment Date, perform
all of the obligations of the Assignor in respect of the Assigned Interest.  From and after the Assignment Date:  (a) the Assignor shall be released from
the Assignor’s obligations in respect of the Assigned Interest, and
(b) the Assignee shall be entitled to all of the Assignor’s rights, powers
and privileges under the Credit Agreement and the other Security Instruments in
respect of the Assigned Interest.


 


Section 2.03           Consent
Required.  By executing this
Agreement as provided below, in accordance with Section 13.06(b) of the
Credit Agreement, to the extent required, the US Administrative Agent, the
Issuing Banks and (unless an Event of Default has occurred or is continuing)
the US Borrowers hereby acknowledge notice of the transactions contemplated by
this Agreement and consents to such transactions.


 


ARTICLE III

Payments.


 


Section 3.01           Payments.  As consideration for the sale, assignment and
transfer contemplated by Section 2.01 hereof, the Assignee shall,
on the Assignment Date, assume Assignor’s obligations in respect of the
Assigned Interest and pay to the Assignor an amount equal to the outstanding
Loans, if any[; provided that any outstanding Bankers’ Acceptances or BA
Equivalent Notes shall either be held to maturity by the Assignor or Assignee
shall pay a discounted amount as determined by Assignor and Assignee].  An amount equal to all accrued and unpaid
interest and fees shall be paid to the Assignor as provided in Section 3.02(iii) below.  Except as otherwise provided in this
Agreement, all payments hereunder shall be made in the applicable currency set
forth in Section 1.02 and in immediately available funds, without
setoff, deduction or counterclaim.


 


Section 3.02           Allocation
of Payments.  The Assignor and the
Assignee agree that (i) the Assignor shall be entitled to any payments of
principal with respect to the Assigned Interest made prior to the Assignment
Date, together with any interest and fees with respect to the Assigned Interest
accrued prior to the Assignment Date, (ii) the Assignee shall be entitled
to any payments of principal with respect to the Assigned Interest made from
and after the Assignment Date, together with any and all interest and fees with
respect to the Assigned Interest accruing from and after the Assignment Date,
and (iii) the Applicable Administrative Agent is authorized and instructed
to allocate payments received by it for account of the Assignor and the
Assignee as provided in the foregoing clauses. 
Each party hereto agrees that it will hold any interest, fees or other
amounts that it may receive to which the other party hereto shall be entitled
pursuant to the preceding sentence for account of such other party and pay, in
like money and funds, any such amounts that it may receive to such other party
promptly upon receipt.


 


Section 3.03           Delivery
of Notes.  Promptly following the
receipt by the Assignor of the consideration required to be paid under Section 3.01
hereof, the Assignor shall, in the manner contemplated by Section 13.06(b)
of the Credit Agreement, (i) deliver to the Applicable Administrative
Agent (or its counsel) the Note(s) and any Bankers’ Acceptances and BA
Equivalent Note(s) (if applicable with any necessary indemnity to be
agreed among the Assignor and the Assignee) held by the Assignor and
(ii) notify the Applicable Administrative Agent to


 


E – 3





















 


request that the Applicable
Borrower execute and deliver new Notes to the Assignor, if Assignor continues
to be a Lender, and the Assignee, dated the date of this Agreement in
respective principal amounts equal to the respective [US Tranche/Canadian
Allocated Maximum Total] Commitment [and outstanding Term Loan] of the Assignor
(if appropriate) and the Assignee after giving effect to the sale, assignment
and transfer contemplated hereby.


 


Section 3.04           Further
Assurances.  The Assignor and the
Assignee hereby agree to execute and deliver such other instruments, and take
such other actions, as either party may reasonably request in connection with
the transactions contemplated by this Agreement.


 


ARTICLE IV

Conditions Precedent.


 


Section 4.01           Conditions
Precedent.  The effectiveness of the
sale, assignment and transfer contemplated hereby is subject to the
satisfaction of each of the following conditions precedent:


 


(a)                                  the
execution and delivery of this Agreement by the Assignor and the Assignee;


 


(b)                                 the
receipt by the Assignor of the payment required to be made by the Assignee
under Section 3.01 hereof; and


 


(c)                                  to
the extent required, the acknowledgment and consent by the Applicable
Administrative Agent, the Issuing Banks and the US Borrowers contemplated by Section 2.03
hereof.


 


ARTICLE V


 


Representations and Warranties.


 


Section 5.01           Representations
and Warranties of the Assignor.  The
Assignor represents and warrants to the Assignee as follows:


 


(a)                                  it
has all requisite power and authority, and has taken all action necessary to
execute and deliver this Agreement and to fulfill its obligations under, and
consummate the transactions contemplated by, this Agreement;


 


(b)                                 the
execution, delivery and compliance with the terms hereof by Assignor and the
delivery of all instruments required to be delivered by it hereunder do not and
will not violate any Governmental Requirement applicable to it;


 


(c)                                  this
Agreement has been duly executed and delivered by it and constitutes the legal,
valid and binding obligation of the Assignor, enforceable against it in
accordance with its terms;


 


(d)                                 all
approvals and authorizations of, all filings with and all actions by any
Governmental Authority necessary for the validity or enforceability of its
obligations under this Agreement have been obtained; and


 


E – 4





















 


(e)                                  the
Assignor has good title to, and is the sole legal and beneficial owner of, the
Assigned Interest, free and clear of all Liens, claims, participations or other
charges of any nature whatsoever.


 


Section 5.02           Disclaimer.  Except as expressly provided in Section 5.01
hereof, the Assignor does not make any representation or warranty, nor shall it
have any responsibility to the Assignee, with respect to the accuracy of any
recitals, statements, representations or warranties contained in the Credit
Agreement or in any certificate or other document referred to or provided for
in, or received by any Lender under, the Credit Agreement, or for the value,
validity, effectiveness, genuineness, execution, effectiveness, legality,
enforceability or sufficiency of the Credit Agreement, the Notes or any other
document referred to or provided for therein or for any failure by the
Borrowers or any other Person (other than Assignor) to perform any of its
obligations thereunder prior or for the existence, value, perfection or
priority of any collateral security or the financial or other condition of the
Borrowers or the Subsidiaries or any other obligor or guarantor, or any other
matter relating to the Credit Agreement or any other Security Instrument or any
extension of credit thereunder.


 


Section 5.03           Representations
and Warranties of the Assignee.  The
Assignee represents and warrants to the Assignor as follows:


 


(a)                                  it
has all requisite power and authority, and has taken all action necessary to
execute and deliver this Agreement and to fulfill its obligations under, and
consummate the transactions contemplated by, this Agreement;


 


(b)                                 the
execution, delivery and compliance with the terms hereof by Assignee and the
delivery of all instruments required to be delivered by it hereunder do not and
will not violate any Governmental Requirement applicable to it;


 


(c)                                  this
Agreement has been duly executed and delivered by it and constitutes the legal,
valid and binding obligation of the Assignee, enforceable against it in
accordance with its terms;


 


(d)                                 all
approvals and authorizations of, all filings with and all actions by any
Governmental Authority necessary for the validity or enforceability of its
obligations under this Agreement have been obtained;


 


(e)                                  the
Assignee is not a competitor of Holdings or any of its Subsidiaries;


 


(f)                                    the
Assignee has fully reviewed the terms of the Credit Agreement and the other
Security Instruments and has independently and without reliance upon the
Assignor, and based on such information as the Assignee has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement; and


 


(g)                                 the
Assignee hereby affirms that the representations contained in Section 4.06(d)[(i)]
[(vi)] of the Credit Agreement are true and accurate as to it [IF (i) IS
SELECTED ADD:  and, the Assignee has
contemporaneously herewith delivered to the US Administrative Agent and the US
Borrower such


 


E – 5





















 


certifications
as are required thereby to avoid the withholding taxes referred to in
Section 4.06 of the Credit Agreement].


 


ARTICLE VI


 


Miscellaneous.


 


Section 6.01           Notices.  All notices and other communications provided
for herein (including, without limitation, any modifications of, or waivers,
requests or consents under, this Agreement) shall be given or made in writing
(including, without limitation, by telex or telecopy) to the intended recipient
at its “Address for Notices” specified below its name on the signature pages
hereof or, as to either party, at such other address as shall be designated by
such party in a notice to the other party.


 


Section 6.02           Amendment,
Modification or Waiver.  No provision
of this Agreement may be amended, modified or waived except by an instrument in
writing signed by the Assignor and the Assignee, and consented to by the US
Administrative Agent and (unless an Event of Default has occurred or is
continuing) the US Borrowers.


 


Section 6.03           Successors
and Assigns.  This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns. 
The representations and warranties made herein by the Assignee are also
made for the benefit of the Applicable Administrative Agent and the
[US/Canadian] Borrower, and the Assignee agrees that the Applicable
Administrative Agent and the [US/Canadian] Borrower are entitled to rely upon
such representations and warranties.


 


Section 6.04           Assignments.  Neither party hereto may assign any of its
rights or obligations hereunder except in accordance with the terms of the
Credit Agreement.


 


Section 6.05           Captions.  The captions and section headings appearing
herein are included solely for convenience of reference and are not intended to
affect the interpretation of any provision of this Agreement.


 


Section 6.06           Counterparts.  This Agreement may be executed in any number
of counterparts, each of which shall be identical and all of which, taken
together, shall constitute one and the same instrument, and each of the parties
hereto may execute this Agreement by signing any such counterpart.


 


Section 6.07           Governing
Law.  This Agreement shall be
governed by, and construed in accordance with, the law of the State of Texas.


 


Section 6.08           Expenses.  To the extent not paid by the [US/Canadian]
Borrower pursuant to the terms of the Credit Agreement, each party hereto shall
bear its own expenses in connection with the execution, delivery and
performance of this Agreement.


 


Section 6.09           Waiver
of Jury Trial.  EACH OF THE PARTIES
HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF


 


E – 6





















 


OR RELATING TO THIS AGREEMENT
OR THE TRANSACTIONS CONTEMPLATED HEREBY.


 


IN WITNESS WHEREOF, the parties hereto have caused
this Assignment Agreement to be executed and delivered as of the date first
above written.


 


	
   

  	
  ASSIGNOR:

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Telecopier No.:

  	
   

  	
   

  
	
   

  	
  Telephone No.:

  	
   

  	
   

  
	
   

  	
  Attention:

  	
   

  	
   

  
									



 


E – 7





















 


	
   

  	
  ASSIGNEE:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Telecopier No.:

  	
   

  	
   

  
	
   

  	
  Telephone No.:

  	
   

  	
   

  
	
   

  	
  Attention:

  	
   

  	
   

  
									



 


 


	
  ACKNOWLEDGED AND CONSENTED
  TO:

  	
   

  
	
   

  	
   

  
	
  WACHOVIA BANK, NATIONAL
  ASSOCIATION,

  	
   

  
	
  as US Administrative Agent
  and Issuing Bank

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  JPMORGAN CHASE BANK, N.A.,

  	
   

  
	
  as Issuing Bank

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   ]

  	
   

  
	
   

  	
   

  
	
  CONSENTED TO:

  	
   

  
	
   

  	
   

  
	
  UNIVERSAL COMPRESSION, INC.

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  UNIVERSAL COMPRESSION
  HOLDINGS, INC.

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  
					



 


E – 8





















EXHIBIT F


FORM OF LETTER OF CREDIT APPLICATIONS


 


WACHOVIA FORM


 


Application and
Agreement for Irrevocable Standby Letter of Credit


 


TO: Wachovia
Bank, National Association (“Bank”)


 


Please TYPE information in the
fields below.  We reserve the right to
return illegible applications for clarification.


 


	
  Date:

  	
   

  	
   

  	
   

  	
  The
  undersigned Applicant hereby requests Bank to issue and transmit by:
o
  Overnight Carrier o
  Teletransmission  o
  Mail o Other:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Explain

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  L/C

  No.

  	
   

  	
  (Bank Use Only)

  	
   

  	
  an Irrevocable
  Standby Letter of Credit (the “Credit”) substantially as set forth below. In
  issuing the Credit, Bank is expressly authorized to make such changes from
  the terms hereinbelow set forth as it, in its sole
  discretion, may deem advisable.

  



 


	
  Applicant (Full Name & Address)

  	
   

  	
  Advising Bank (Designate name & address only if
  desired)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Beneficiary (Full Name & Address)

  	
   

  	
  Currency and Amount in Figures:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Currency and Amount in Words:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Expiration Date:

  
	
   

  	
   

  	
   

  
	
  Charges: Wachovia’s
  charges are for our account; all other banking charges are to be paid by
  beneficiary.

  



 


	
  Credit to be available
  for payment against Beneficiary’s draft(s) at sight drawn on Bank or its
  correspondent at Bank’s option accompanied by the following documents:

  
	
   

  
	
  o

  	
   

  	
  Statement, purportedly signed by the Beneficiary, reading as follows
  (please state below exact wording to appear on the statement):

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  Other
  Documents

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  Special Conditions (including, if Applicant has a preference,
  selection of UCP as herein defined or ISP98 as herein defined.)

  



 


F – 1





















 


	
  o

  	
   

  	
  Issue
  substantially in form of attached specimen. (Specimen must also be signed by
  applicant.)

  



 


F – 2





















 


	
  Complete only when the
  Beneficiary (Foreign Bank, or other Financial Institution) is to issue its
  undertaking based on this Credit.

  
	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  Request Beneficiary to
  issue and deliver their (specify type of undertaking)           
  in favor of            for
  an amount not exceeding the amount specified above, effective immediately
  relative to (specify contract number or other pertinent reference)     
  to expire on             .
  (This date must be at least 15 days prior to expiry date indicated above.) It
  is understood that if the Credit is issued in favor of any bank or other
  financial or commercial entity which has issued or is to issue an undertaking
  on behalf of the Applicant of the Credit in connection with the Credit, the
  Applicant hereby agrees to remain liable under this Application and Agreement
  in respect of the Credit (even after its stated expiry date) until Bank is
  released by such bank or entity.

  



 


Each Applicant signing below affirms that
it has fully read and agrees to this Application and the attached Continuing
Letter of Credit Agreement. In consideration of the Bank’s issuance of the
Credit, the Applicant agrees to be bound by the agreement set forth in this and
in the following pages (even if the following pages are not attached to the
Application) delivered to the Bank. (Note: If a bank, trust company, or other
financial institution signs as Applicant or joint and several co-Applicant for its customer, or if two Applicants jointly
and severally apply, both parties sign below). Documents may be forwarded to
the Bank by the beneficiary, or the negotiating bank, in one mail.  Bank may forward documents to Applicant’s
customhouse broker, or Applicant if specified above, in one mail. Applicant
understands and agrees that this Credit will be subject to the Uniform Customs
and Practice for Documentary Credits of the International Chamber of Commerce
currently in effect, and in use by Bank (“UCP”) or to
the International Standby Practices of the International Chamber of Commerce,
Publication 590 or any subsequent version currently in effect and in use by
Bank (“ISP98”).


 


 


	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (Print or type name of
  Applicant)

  	
   

  	
   

  	
   

  	
  (Print or type name of
  Co-Applicant)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (Address)

  	
   

  	
   

  	
   

  	
  (Address)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Authorized Signature (Title)

  	
   

  	
   

  	
   

  	
  Authorized Signature (Title)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Authorized Signature (Title)

  	
   

  	
   

  	
   

  	
  Authorized Signature (Title)

  
	
   

  
	
  Customer Contact:

  	
   

  	
   

  	
   

  	
  Phone No.:

  
							



 


	
  BANK USE ONLY

  NOTE : Application will NOT be processed if this section is not
  complete

  
	
   

  
	
  Approved
  (Authorized Signature)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Date:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Approved
  (Print name and title)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  City:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Customer SIC
  Code:

  	
   

  	
  Borrower

  Default Grade:

  	
   

  	
   

  	
   

  	
  Telephone:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Charge DDA #

  	
   

  	
  Fee:

  	
   

  	
  RC #:

  	
   

  	
  CLAS
  Bank #

  	
   

  	
  CLAS
  Obligor #:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Other (please explain):

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


F – 3





















 


JPMORGAN FORM


 


Application and Agreement for
Irrevocable


Standby Letter
of Credit


 


JPMorgan Chase Bank, N.A.


 


This application and the Letter of Credit issued hereunder are subject
to and governed by the CONTINUING AGREEMENT
FOR COMMERCIAL & STANDBY LETTERS OF CREDIT executed by the
undersigned in favor of JPMorgan Chase Bank, N.A. on                  (the
“Agreement”).


 


When transmitting this application by
facsimile all pages must be transmitted.


 


To:  JPMorgan Chase Bank,
N.A. and/or its subsidiaries and/or affiliates.                                                                                 Date:


 


I.  Pursuant to
the Terms and Conditions contained herein, please issue an IRREVOCABLE STANDBY
Letter of Credit (together with any replacements, extensions or modifications,
the “Credit”) and transmit it by:


 


	
  o Teletransmission

  	
   

  	
  o Courier

  	
   

  	
  o Air Mail (Domestic addresses only)

  



 


If completing
application in Microsoft Word, please enter data by ‘clicking’ on the gray
boxes.


 


	
  Applicant/Obligor (Full name and address jointly and
  severally if more than one, individually and collectively,
  “Applicant/Obligor”):

  	
   

  	
  Beneficiary (Full name and address):

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  [Signature lines are on last page].

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Account Party (Full name and address of entity to be named in Letter of Credit if
  different than the above Applicant/Obligor):

  	
   

  	
  Advising Bank-Optional (If blank, Issuer
  will select its branch or affiliate or correspondent in the domicile of the
  beneficiary):

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Amount:
Up to an aggregate amount of

  If not USD, indicate currency

  	
   

  	
  Expiry Date: Demands/claims
  must be presented to the counters of the Issuing bank not later than

  
	
   

  	
   

  	
   

  
	
  Complete only if Automatic
  Extension of the expiry date is required.

  	
   

  	
   

  



 


F – 4





















 


	
  Credit to contain Automatic Extension clause with extension period of
  o
  one year/o other

  	
  (please specify).

  
	
   

  
	
  No less than

  	
  calendar days
  non-extension notice to the beneficiary.

  
	
   

  
	
  Automatic Extension final expiration date:                                                          (the
  date after which the Credit will no longer be subject to Automatic
  Extension).

  
	
   

  
	
  AVAILABLE BY
  (indicate A, B or C)

  
	
   

  
	
  o

  	
    A.
  Beneficiary’s dated statement referencing JPMorgan
  Chase Bank, N.A. Letter of Credit Number indicating
  amount of demand/claim and purportedly signed by an authorized person reading
  as follows (Please state within the quotation marks the wording to appear on
  the statement to be presented):

  
	
   

  	
   

  
	
   

  	
  “(insert
  appropriate reason for drawing)

  
	
   

  
	
  ”

  
	
   

  
	
  Demands received by authenticated teletransmission are acceptable in lieu of the
  beneficiary’s signed and dated statement provided that such authenticated teletransmission contains the beneficiary’s statement as
  provided for in the Credit.

  
	
   

  
	
  o

  	
    B. See attached sheet(s) for
  continuation of other documents and/or special instructions, which form an
  integral part of this Application and such specimen
  should be approved and signed by the applicant/obligor.

  
	
   

  
	
  o

  	
  C. Other:

  
	
   

  
	
   

  
	
   

  
	
  Complete only when
  the Beneficiary’s bank or Correspondent is to issue its guarantee or undertaking
  based on the issued Standby Letter of Credit.

  
	
   

  
	
  We understand and agree that by making this
  request, we shall remain liable under this Credit until Issuer is fully
  released in writing by such entity.

  
	
   

  
	
  o

  	
    Request
  Beneficiary’s bank to issue and deliver its:

  
	
   

  	
  (Specify
  type of bid or performance bond, guarantee, undertaking or other)

  
	
   

  
	
  In favor of:

  	
  Name(s)

  
	
   

  	
   

  
	
   

  	
  Attention Party Name

  
	
   

  	
   

  
	
   

  	
  Address

  
						



 


F – 5





















 


	
   

  	
  City/State/Zip/Country

  
	
   

  	
   

  
	
   

  	
  Telephone

  
	
   

  	
   

  
	
   

  	
  Fax

  
	
   

  
	
  For an amount not exceeding that specified
  above, effective immediately and expiring at their office on       .

  
	
   

  
	
  (at least 30 days
  prior to Expiry Date above) covering (brief description):
         .

  
	
   

  
	
   

  
	
  o

  	
  Multiple
  drawings prohibited (if blank, multiple drawings will be permitted).

  
	
   

  	
   

  
	
  o

  	
  Credit is
  transferable only in its entirety (Issuer is authorized to include its
  standard transfer conditions and is authorized to nominate a transferring
  bank, if applicable).

  
	
   

  
	
  The Credit, or any Credit issued shall be
  subject to the International Standby Practices 1998 (International Chamber of
  Commerce Publication 590) (“the “ISP”) or, o if box is checked, it shall be subject to the Uniform Customs and
  Practice for Documentary Credits (1993) Revision International Chamber of
  Commerce Publication No. 500 (the “UCP”).

  
	
   

  
	
  Please include a brief
  description of the purpose of the Standby Letter of Credit:

  
	
   

  
			



 


Unless otherwise stated herein, the nominated bank (if any) is
authorized to send all documents to you in one airmail or courier service, if
available.


 


F – 6





















 


THE UNDERSIGNED HEREBY AGREES TO ALL THE TERMS AND CONDITIONS SET FORTH
IN THE AGREEMENT, ALL OF WHICH HAVE BEEN READ AND UNDERSTOOD BY THE
UNDERSIGNED.


 


 


	
   

  	
   

  	
   

  
	
   

  	
  (Applicant/Obligor)

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Authorized Signature/Title)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Phone)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Fax)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Date)

  	
   

  



 


Without limiting the terms above, you are
authorized to debit our account no.


 


with
JPMorgan Chase Bank, N.A.
for the amount of each drawing and/or your commissions and charges.


 


 


THE FOLLOWING IS TO BE EXECUTED IF THE CREDIT
IS TO BE ISSUED FOR THE ACCOUNT OF A PERSON OTHER THAN THE PERSON SIGNING
ABOVE:


 


AUTHORIZATION AND AGREEMENT OF ADDITIONAL
PARTY NAMED AS ACCOUNT PARTY


 


To:  THE ISSUER OF THE CREDIT


 


We join in this Application, naming us as Account Party, for the
issuance of the Credit and, in consideration thereof, we irrevocably agree (i) that the above Applicant has sole right to give
instructions and make agreements with respect to this Application, the
Agreement, the Credit and the disposition of documents, and we have no right or
claim against you, any of your affiliates or subsidiaries, or any correspondent
in respect of any matter arising in connection with any of the foregoing and
(ii) to be bound by the Agreement and all obligations of the Applicant thereunder as if we were a party thereto.  The Applicant is authorized to assign or
transfer to you all or any part of any security held by the Applicant for our
obligations arising in connection with this transaction and, upon any such
assignment or transfer, you shall be vested with all powers and


 


F – 7





















 


rights in respect
of the security transferred or assigned to you and you may enforce your rights
under the Agreement against us or our Property in accordance with the terms
hereof.


 


 


	
   

  	
   

  	
   

  
	
   

  	
  (Account Party)

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Authorized Signature/Title)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Phone)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Fax)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Date)

  	
   

  



 


F – 8





















 


EXHIBIT G

FORM OF ELECTION CERTIFICATE


 


The undersigned hereby certifies that he is the                 
of UNIVERSAL COMPRESSION HOLDINGS, INC., a Delaware corporation (“Holdings”) and that as such he is authorized
to execute this certificate on behalf of Holdings.  With reference to the Senior Secured Credit
Agreement dated as of January 14, 2005, among Universal Compression, Inc.,
a Texas corporation (“UCI”) and Holdings, UC Canadian Partnership Holdings Company, a Nova Scotia ULC (the “Canadian Borrower”), Wachovia Bank,
National Association, as US Administrative Agent (the “US Administrative
Agent”), Congress Financial Corporation (Canada), as the Canadian
Administrative Agent (the “Canadian Administrative Agent”), and such
Lenders party thereto (as the same may be amended or supplemented from time to
time, the “Credit Agreement”), the undersigned hereby certifies in
accordance with Section 2.14 of the Credit Agreement as follows (each
capitalized term used herein having the same meaning given to it in the Credit
Agreement unless otherwise specified):


 


1.                                       The
Debt of UCI described in Sections 10.01(b), (d), (f)
and (k) of the Credit Agreement (excluding performance guaranties and bonds) has been refinanced, paid off or assumed
by Holdings, and UCI is released from such Debt
except for unsecured guaranties of such Debt and except $          
(up to $10M) of such Debt to which UCI remains the
primary obligor.


 


2.                                       UCI has executed the Guarantee and Collateral Agreement
guaranteeing the performance and payment obligations of Holdings under the Loan
Documents.


 


3.                                       Holdings hereby
elects to become the sole US Borrower and assume all of the rights and
obligations of the sole US Borrower under the Loan Documents (including,
without limitation, any Loans made prior to the date hereof).


 


EXECUTED AND DELIVERED this     
day of                                     .


 


	
   

  	
  UNIVERSAL COMPRESSION
  HOLDINGS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


G – 1





















 


Schedule 2.01(b) –
Existing Letters of Credit

(thru 1/13/05)


 


	
  LC #

  	
   

  	
  Issuer

  	
   

  	
  Beneficiary

  	
   

  	
  Type of
  Bond

  	
   

  	
  Date

  Effective

  	
   

  	
  Expirations

  	
   

  	
  LC

  Balance

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SM421591C

  	
   

  	
  Asia-Pacific

  	
   

  	
  Bank of China - China Petroleum

  	
   

  	
  Performance Bond

  	
   

  	
  06/24/02

  	
   

  	
  03/04/05

  	
   

  	
  1,124,878.90

  	
   

  	
   

  	
   

  
	
  SM422161W

  	
   

  	
  Asia-Pacific

  	
   

  	
  Bank of China - China Offshore Ind
  Corp

  	
   

  	
  Performance Bond

  	
   

  	
  08/01/02

  	
   

  	
  03/04/05

  	
   

  	
  27,377.68

  	
   

  	
   

  	
   

  
	
  SM422506W

  	
   

  	
  Asia-Pacific

  	
   

  	
  Korea Exchange Bank

  	
   

  	
  Performance Bond

  	
   

  	
  08/27/02

  	
   

  	
  09/15/05

  	
   

  	
  43,000.00

  	
   

  	
   

  	
   

  
	
  SM422407W

  	
   

  	
  Asia-Pacific

  	
   

  	
  Kyungnam Bank Korea

  	
   

  	
  Performance Bond

  	
   

  	
  08/20/02

  	
   

  	
  09/21/05

  	
   

  	
  418,000.00

  	
   

  	
   

  	
   

  
	
  SC100232U

  	
   

  	
  Asia-Pacific

  	
   

  	
  Mari Gas Company Ltd. – Pakistan

  	
   

  	
  Bid Bond

  	
   

  	
  12/14/04

  	
   

  	
  05/31/05

  	
   

  	
  600,000.00

  	
   

  	
   

  	
   

  
	
  CY540556

  	
   

  	
  Asia-Pacific

  	
   

  	
  Bechtel Int’l Corporation

  	
   

  	
  Performance Bond

  	
   

  	
  04/08/03

  	
   

  	
  12/31/05

  	
   

  	
  34,180.08

  	
   

  	
   

  	
   

  
	
  SC100261U

  	
   

  	
  Asia-Pacific

  	
   

  	
  Assam Gas Company Ltd. – India

  	
   

  	
  Bid Bond

  	
   

  	
  12/09/04

  	
   

  	
  01/16/06

  	
   

  	
  70,000.00

  	
   

  	
   

  	
   

  
	
  CY547961

  	
   

  	
  Asia-Pacific

  	
   

  	
  Citibank India

  	
   

  	
  Performance Bond

  	
   

  	
  08/15/03

  	
   

  	
  04/09/06

  	
   

  	
  25,148.00

  	
   

  	
   

  	
   

  
	
  SC100202U

  	
   

  	
  Asia-Pacific

  	
   

  	
  Oil & Gas Development Co. – Pakistan

  	
   

  	
  Guarantee Bond

  	
   

  	
  10/25/04

  	
   

  	
  05/31/06

  	
   

  	
  114,500.00

  	
   

  	
   

  	
   

  
	
  SC100136U

  	
   

  	
  Asia-Pacific

  	
   

  	
  Jurong Engineering Ltd - Singapore

  	
   

  	
  Guarantee Bond

  	
   

  	
  08/03/04

  	
   

  	
  08/15/06

  	
   

  	
  52,000.00

  	
   

  	
   

  	
   

  
	
  CY549731

  	
   

  	
  Asia-Pacific

  	
   

  	
  Toshiba America Inc - CA

  	
   

  	
  Performance Bond

  	
   

  	
  10/22/03

  	
   

  	
  05/01/07

  	
   

  	
  39,000.00

  	
   

  	
   

  	
   

  
	
  GL
  69991-7060

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  TOTAL LC’S

  	
   

  	
  2,548,084.66

  	
   

  	
  TOTAL ASIA

  	
   

  
	
  SM421947W

  	
   

  	
  Canada

  	
   

  	
  Standard Chartered Bk of
  Malaysia

  	
   

  	
  Performance Bond

  	
   

  	
  07/19/02

  	
   

  	
  02/22/05

  	
   

  	
  161,075.00

  	
   

  	
   

  	
   

  
	
  SM422420W

  	
   

  	
  Canada

  	
   

  	
  Cooper Energy Svcs

  	
   

  	
  Performance Bond

  	
   

  	
  08/22/02

  	
   

  	
  03/01/05

  	
   

  	
  161,075.00

  	
   

  	
   

  	
   

  
	
  CY547264

  	
   

  	
  Canada

  	
   

  	
  CNOOC/China Bank Shanghai

  	
   

  	
  Performance Bond

  	
   

  	
  07/30/03

  	
   

  	
  03/30/05

  	
   

  	
  146,485.00

  	
   

  	
   

  	
   

  
	
  SM420067C

  	
   

  	
  Canada

  	
   

  	
  Korea Exchange Bank - Hyundai

  	
   

  	
  Guarantee Bond

  	
   

  	
  02/20/02

  	
   

  	
  04/15/05

  	
   

  	
  172,400.00

  	
   

  	
   

  	
   

  
	
  SC100080U

  	
   

  	
  Canada

  	
   

  	
  Petreco Canada Inc

  	
   

  	
  Performance Bond

  	
   

  	
  04/30/04

  	
   

  	
  04/30/05

  	
   

  	
  49,155.00

  	
   

  	
   

  	
   

  
	
  CY547981

  	
   

  	
  Canada

  	
   

  	
  CNOOC/China Bank Shanghai

  	
   

  	
  Performance Bond

  	
   

  	
  08/15/03

  	
   

  	
  07/15/05

  	
   

  	
  46,500.00

  	
   

  	
   

  	
   

  
	
  GL
  64067-7060

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  TOTAL LC’S

  	
   

  	
  736,690.00

  	
   

  	
  TOTAL CANADA

  	
   

  
	
  SC100281U

  	
   

  	
  Latin

  	
   

  	
  Empresa Petrolera CHACO S A

  	
   

  	
  Advance Pymt Bond

  	
   

  	
  12/21/04

  	
   

  	
  10/17/05

  	
   

  	
  1,380,000.00

  	
   

  	
   

  	
   

  
	
  CY549729

  	
   

  	
  Latin

  	
   

  	
  Pemex Exploracion Y Produccion - Mexico

  	
   

  	
  Bid Bond

  	
   

  	
  10/21/03

  	
   

  	
  10/22/05 *

  	
   

  	
  330,000.00

  	
   

  	
   

  	
   

  
	
  CY549730

  	
   

  	
  Latin

  	
   

  	
  Pemex Exploracion Y Produccion - Mexico

  	
   

  	
  Bid Bond

  	
   

  	
  10/21/03

  	
   

  	
  10/22/05 *

  	
   

  	
  32,400.00

  	
   

  	
   

  	
   

  
	
  CY550843

  	
   

  	
  Latin

  	
   

  	
  Repsol YPF Ecuador SA

  	
   

  	
  Performance Bond

  	
   

  	
  12/08/03

  	
   

  	
  01/10/06

  	
   

  	
  45,679.71

  	
   

  	
   

  	
   

  
	
  CY550110

  	
   

  	
  Latin

  	
   

  	
  Pemex Exploracion – Banamex Mexico

  	
   

  	
  Bid Bond

  	
   

  	
  11/03/03

  	
   

  	
  01/15/06

  	
   

  	
  53,475.44 

  	
   

  	
  DECREASED

  	
   

  
	
  CY550110

  	
   

  	
  Latin

  	
   

  	
  Pemex Exploracion – Banamex Mexico

  	
   

  	
  Bid Bond

  	
   

  	
  04/06/04

  	
   

  	
  01/15/06

  	
   

  	
  (2,540.43

  	
  )

  	
  50,935.01

  	
   

  
	
  CY550112

  	
   

  	
  Latin

  	
   

  	
  Pemex Exploracion - Banamex Mexico

  	
   

  	
  Bid Bond

  	
   

  	
  11/03/03

  	
   

  	
  01/15/06

  	
   

  	
  715,700.00

  	
   

  	
   

  	
   

  
	
  SC100134U

  	
   

  	
  Latin

  	
   

  	
  Pemex Exploracion - Banamex Mexico

  	
   

  	
  Performance Bond

  	
   

  	
  08/04/04

  	
   

  	
  06/27/07

  	
   

  	
  2,476,845.00

  	
   

  	
   

  	
   

  
	
  SC100135U

  	
   

  	
  Latin

  	
   

  	
  Pemex Exploracion - Banamex Mexico

  	
   

  	
  Performance Bond

  	
   

  	
  08/04/04

  	
   

  	
  06/27/07

  	
   

  	
  59,477.90

  	
   

  	
   

  	
   

  
	
  SC100282U

  	
   

  	
  Latin

  	
   

  	
  Empresa Petrolera CHACO S A

  	
   

  	
  Performance Bond

  	
   

  	
  12/21/04

  	
   

  	
  07/17/07

  	
   

  	
  2,000,000.00

  	
   

  	
   

  	
   

  
	
  GL
  64069-7060

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  TOTAL LC’S

  	
   

  	
  7,091,037.62

  	
   

  	
  TOTAL LATIN

  	
   

  
	
  SC100071U

  	
   

  	
  UCI

  	
   

  	
  Ace American Insurance Co – PA

  	
   

  	
  Guarantee Bond

  	
   

  	
  04/15/04

  	
   

  	
  03/31/05 *

  	
   

  	
  3,000,000.00

  	
   

  	
   

  	
   

  
	
  SM417330C

  	
   

  	
  UCI

  	
   

  	
  Royal Bank of Canada (formerly UBS)

  	
   

  	
   

  	
   

  	
  06/22/01

  	
   

  	
  06/19/05

  	
   

  	
  111,594.00 

  	
   

  	
  DECREASED

  	
   

  
	
  SM417330C

  	
   

  	
  UCI

  	
   

  	
  Royal Bank of Canada (formerly UBS)

  	
   

  	
   

  	
   

  	
  06/25/01

  	
   

  	
  06/19/05

  	
   

  	
  (27,901.00

  	
  )

  	
  83,693.00

  	
   

  
	
  SM417321C

  	
   

  	
  UCI

  	
   

  	
  Royal Bank of Canada (formerly UBS)

  	
   

  	
   

  	
   

  	
  06/22/01

  	
   

  	
  06/20/05

  	
   

  	
  76,945.00

  	
   

  	
   

  	
   

  
	
  CY550051

  	
   

  	
  UCI

  	
   

  	
  Tractebel Energy Svcs Inc - Houston
  TX

  	
   

  	
  Bid Bond

  	
   

  	
  10/31/03

  	
   

  	
  12/31/05

  	
   

  	
  70,000.00

  	
   

  	
   

  	
   

  
	
  SM200016W

  	
   

  	
  UCI

  	
   

  	
  Zurich Insurance

  	
   

  	
  Guarantee Bond

  	
   

  	
  09/13/02

  	
   

  	
  03/31/06 *

  	
   

  	
  1,472,375.00

  	
   

  	
  Increased total LC

  	
   

  
	
  SM200016W

  	
   

  	
  UCI

  	
   

  	
  Zurich Insurance

  	
   

  	
  Guarantee Bond

  	
   

  	
  09/13/02

  	
   

  	
  03/31/06 *

  	
   

  	
  1,457,897.00

  	
   

  	
  2,930,272.00

  	
   

  
	
  CY549047

  	
   

  	
  UCI

  	
   

  	
  Ferrostaal Inc.

  	
   

  	
  Bid Bond

  	
   

  	
  09/29/03

  	
   

  	
  09/30/06

  	
   

  	
  19,900.00 

  	
   

  	
  DECREASED

  	
   

  
	
  CY549047

  	
   

  	
  UCI

  	
   

  	
  Ferrostaal Inc.

  	
   

  	
  Bid Bond

  	
   

  	
  09/29/03

  	
   

  	
  09/30/06

  	
   

  	
  (9,950.00

  	
  )

  	
  9,950.00

  	
   

  
	
  GL
  210201002

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  TOTAL LC’S

  	
   

  	
  6,170,860.00

  	
   

  	
  TOTAL UCI

  	
   

  
	
  SC100099U

  	
   

  	
  Asia-Pacific

  	
   

  	
  Orgin Energy CSG Ltd – Australia

  	
   

  	
  Performance Bond

  	
   

  	
  06/18/04

  	
   

  	
  01/14/05

  	
   

  	
  329,005.00

  	
   

  	
   

  	
   

  
	
  SC100148U

  	
   

  	
  Asia-Pacific

  	
   

  	
  Orgin Energy CSG Ltd - Australia

  	
   

  	
  Advance Pymt Bond

  	
   

  	
  08/20/04

  	
   

  	
  01/14/05

  	
   

  	
  5,264,081.00

  	
   

  	
   

  	
   

  
	
  CY551221

  	
   

  	
  UCI Fab

  	
   

  	
  SCGCL/Thailand

  	
   

  	
  Performance Bond

  	
   

  	
  01/06/04

  	
   

  	
  01/24/05

  	
   

  	
  39,813.00

  	
   

  	
   

  	
   

  
	
  SC100280U

  	
   

  	
  Latin

  	
   

  	
  BP Exploration Co-Columbia-Ltd

  	
   

  	
  Advance Pymt Bond

  	
   

  	
  12/21/04

  	
   

  	
  01/24/05

  	
   

  	
  657,118.20

  	
   

  	
   

  	
   

  
	
  SC100220U

  	
   

  	
  Latin

  	
   

  	
  BP Exploration Co-Columbia-Ltd

  	
   

  	
  Advance Pymt Bond

  	
   

  	
  11/04/04

  	
   

  	
  01/24/05

  	
   

  	
  1,533,275.80

  	
   

  	
   

  	
   

  
	
  SC100174U

  	
   

  	
  Latin

  	
   

  	
  BP Exploration Co-Colombia- Ltd

  	
   

  	
  Advance Pymt Bond

  	
   

  	
  09/23/04

  	
   

  	
  02/02/05

  	
   

  	
  1,533,275.80

  	
   

  	
   

  	
   

  
	
  SC100105U

  	
   

  	
  Latin

  	
   

  	
  BP Exploration Co-Colombia- Ltd

  	
   

  	
  Advance Pymt Bond

  	
   

  	
  06/21/04

  	
   

  	
  02/08/05

  	
   

  	
  657,118.20

  	
   

  	
   

  	
   

  
	
  SC100057U

  	
   

  	
  Asia-Pacific

  	
   

  	
  Petronas MITCO Japan - Malaysia

  	
   

  	
  Guarantee Bond

  	
   

  	
  03/24/04

  	
   

  	
  01/30/06

  	
   

  	
  32,000.00

  	
   

  	
   

  	
   

  
	
  CY544112

  	
   

  	
  UCI Fab

  	
   

  	
  CNOOC/China Bank Shanghai

  	
   

  	
  Advance Pymt Bond

  	
   

  	
  06/03/03

  	
   

  	
  04/14/06

  	
   

  	
  783,610.00

  	
   

  	
   

  	
   

  
	
  SC100097U

  	
   

  	
  Asia-Pacific

  	
   

  	
  China Petroleum Material - China

  	
   

  	
  Advance Pymt Bond

  	
   

  	
  06/17/04

  	
   

  	
  05/15/06

  	
   

  	
  224,898.00

  	
   

  	
   

  	
   

  
	
  SC100125U

  	
   

  	
  Asia-Pacific

  	
   

  	
  Shenzhen CNPC Material -
  China

  	
   

  	
  Performance Bond

  	
   

  	
  07/23/04

  	
   

  	
  07/30/06

  	
   

  	
  106,118.00

  	
   

  	
   

  	
   

  
	
  SC100100U

  	
   

  	
  Asia-Pacific

  	
   

  	
  Orgin Energy CSG Ltd - Australia

  	
   

  	
  Performance Bond

  	
   

  	
  06/18/04

  	
   

  	
  08/15/06

  	
   

  	
  329,005.00

  	
   

  	
   

  	
   

  
	
  SC100104U

  	
   

  	
  Asia-Pacific

  	
   

  	
  Sumitomo Chemical Engineering Co (Japan)

  	
   

  	
  Performance Bond

  	
   

  	
  06/18/04

  	
   

  	
  01/16/07

  	
   

  	
  23,700.00

  	
   

  	
   

  	
   

  
	
  FOR JOBS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  TOTAL LC’S

  	
   

  	
  11,513,018.00

  	
   

  	
  TOTAL UCI  FAB

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  GL
  420000700

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  TOTAL LC’S

  	
   

  	
  0.00

  	
   

  	
  TOTAL UCI  FAB

  	
   

  
	
  CY551815

  	
   

  	
  AMS

  	
   

  	
  Trans Colorado Gas Transmission Co

  	
   

  	
  Bid Bond

  	
   

  	
  02/18/04

  	
   

  	
  01/31/05

  	
   

  	
  2,000,000.00

  	
   

  	
   

  	
   

  
	
  GL
  510107060

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  TOTAL LC’S

  	
   

  	
  2,000,000.00

  	
   

  	
  TOTAL UCI  FAB

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SB536089

  	
   

  	
   

  	
   

  	
  Subtotal US$

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  30,059,690.28

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bankers
  Trust

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  S12425

  	
   

  	
  Bankers Trust

  	
   

  	
  Zurich Insurance

  	
   

  	
   

  	
   

  	
  10/15/01

  	
   

  	
  12/31/05

  	
   

  	
  153,000.00

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Subtotal

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  153,000.00

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Total US$

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  30,212,690.28

  	
   

  	
   

  	
   

  



 


2.01(b) – 1





















 


Schedule 6.01(q) –
Excepted Property


 


	
  Stock

  	
   

  	
  Issue

  
	
  PT Universal Compression
  Indonesia

  	
   

  	
  Stock is being
  certificated in approximately a 65% share and 35% share. Once the stock is
  issued, approximately 65% will be pledged to the Notes.

  
	
   

  	
   

  	
   

  
	
  Universal Compression
  (Thailand) Ltd.

  	
   

  	
  Stock is being re-issued
  since 600,000 shares have been issued and approximately 390,000 shares will
  be pledged to the Administrative Agent.

  



 


6.01(q) – 1





















 


Schedule 7.02 - Liabilities


 


CONTINGENT OBLIGATIONS


 


1.                                       Miscellaneous performance bonds and
guarantees and similar contingent obligations, none of which constitute debt
under GAAP for borrowed money and all of which are
permitted under this Agreement.


 


2.                                       In December 1999, Weatherford Global
sold the assets and properties of its Gemini compressor business in Corpus
Christi, Texas to GE Packaged Power, L.P., or GEPP.
As part of that sale, Weatherford Global entered into an agreement to purchase
from GEPP $38.0 million of compressor components
over five years and $3.0 million of parts over three years, and GEPP agreed to provide compressors to Weatherford Global
during that time period at negotiated prices. 
The US Borrowers assumed this obligation in connection with the
acquisition of Weatherford Global in February 2001.  As of March 31, 2004, approximately
$25.9 million of components and approximately $13.5 million of parts
have been purchased from GEPP. As a result of GEPP product performance issues, the US Borrowers have been
unable to satisfy and have not satisfied in full our purchase commitment in
respect of components under this agreement with GEPP.  The unsatisfied portion of the purchase
commitment is approximately $12.1 million. 
GEPP could assert its right to enforce this
obligation, but has not indicated any interest to do so at this time.  However, if GEPP
should seek to enforce this obligation, the US Borrowers believe they have
valid defenses and counter claims and would aggressively defend against such
enforcement and pursue such counter claims.


 


3.                                       See also Schedule 10.02.


 


7.02 – 1





















 


Schedule
7.03
- Litigation


 


1.                                       PERSONAL INJURY - Doyle
Russell Hart v. Forest Oil Corporation, et al - On or about September 27, 2001, plaintiff was a member of a production
barge located in the Magnolia Field in Plaquemines Parish when an explosion in
the low-pressure separator allegedly resulted in his injury.


 


2.                                       PERSONAL INJURY - Juan
Castillo v. American Optical Corporation, et al - Alleged exposure of plaintiff to silica while in the
scope of job duties.


 


3.                                       PERSONAL INJURY -
Maria Guadalupe Garza and Judith Garza v. Universal Compression, Inc. - Alleged vehicle collision with Jamie L.
Hawke, an employee of UCI.


 


4.                                       PERSONAL INJURY - George
Fields v. Kerry Callahan, Universal Compression, Inc. and Zurich Ins. Co.
- Alleged vehicle collision with Kerry Callahan,
an employee of UCI.


 


5.                                       PERSONAL INJURIES - Irma Hearn
and Robert McGarry v. Kerry Callahan, Zurich Insurance and Universal
Compression, Inc. - Alleged vehicle
collision with Kerry Callahan, an employee of UCI.


 


6.                                       PERSONAL INJURY - Prohn,
Carolyn v. Zurich Insurance, Universal Compression, Inc. and K. Callahan - Alleged
passenger of Kerry Callahan, an employee of UCI, when he was involved in a
vehicular collision.


 


7.                                       PERSONAL INJURY - Joanne
Autio v. UC Canada Ltd, et. al. – Alleged passenger on January 21, 2002, in an automobile in Edmonton, Alberta when
it collided with another vehicle driven by Alfred Steinke, an employee of UC
Canada.


 


8.                                       PERSONAL INJURY - Jessie
Sizemore v. Duke Gilbert, Zurich and Universal Compression, Inc. - On October 28, 2003, Petitioner allegedly was
operating a Mack 80000 vehicle when it collided with another vehicle driven by
Duke Gilbert, an employee of UCI.


 


9.                                       PROPERTY DAMAGE – Donald L.
Thomas et al v. Duke Gilbert, Zurich Insurance and Universal Compression, Inc.
– Petitioner is owner of a Fruehauff trailer
allegedly loaded with sugar cane and pulled by Jessie Sizemore when it collided
with another vehicle driven by Duke Gilbert, an
employee of UCI.


 


10.                                 PERSONAL INJURY - Russell
Galliano v. Universal Compression, Inc. – Slip and fall while plaintiff was rerigging, allegedly caused by oil that
dripped onto a handrail from UCI’s mechanics and operators oiling of a chain-fall.


 


11.                                 SALARY DIFFERENTIALS AND
UNFAIR DISMISSAL - Bovieri, Victor v. Universal Compression Argentina -
Former employee allegedly suffered unfair dismissal and salary differentials
and requests compensation readjustment.


 


12.                                 WRONGFUL TERMINATION - Bruce Allen
Pickrell v. UC Canada Inc. - Plaintiff
alleges he was terminated without cause and that he should have received 6
months pay in lieu of notice.


 


13.                                 PRODUCT CASE - Alberta
Energy Co v. Weatherford Canada - Alleged seizing and loss of the unit and shut down of a portion of a facility
while Weatherford was allegedly servicing unit.


 


7.03 – 1





















 


14.                                 PRODUCT CASE - Rio Alto
Exploration v. UC Canada, Ltd. – Alleged damages for the cost of fire
suppression, compressor and compressor building replacement due to fire in
compressor building.


 


15.                                 BREACH OF CONTRACT - Barton
Malow Co, Subrogee for St. Paul Fire and Marine Insurance v. Universal
Compression, Inc. and Universal Compression Holdings, Inc. - On or about
August 1, 2002, incorrect technical drawings allegedly caused damage to
plaintiff’s enclosure when the compressors vented due to system failure.


 


16.                                 BANKRUPTCY - Tri-Union
Operating Company and Tri-Union Development Company – Customer previously filed
for Chapter 11 protection and is currently paying UCI for UCI’s claim.


 


17.                                 BANKRUPTCY – Aviva Petroleum
Inc. – Customer previously filed for Chapter 11 protection and UCI currently
has a post-petition adminstrative claim relating to contract compression.


 


18.                                 COLLECTION - Universal
Compression, Inc. v. Marlin Gas Transport - Defendant failed to pay invoices for rental equipment and reimbursement
for parts and or services.


 


19.                                 BREACH OF CONTRACT – Universal Compression, Inc. v. Indumes  S.A. de C.V. – Indumes breached its contract by failing to pay rental
fees.


 


20.                                 OTHER - Robert
& Joann Swink, et. al. v. Universal Compression, Inc., ConocoPhillips,
Hanover, et al - Plaintiffs allege
exposure to significant infrasonic sound and auditable noise levels due to
large unenclosed reciprocating engines/compressors that operate at the Whitson
Compressor Station in Tuscallloosa County, Alabama caused damages.


 


21.                                 OTHER - Canadian
Western Bank v. Weatherford Global; Adrian Hunter (Hunter’s Engine); Marc Dame
(Onyx Capital) – Borrower’s defaulted on
loan relating to three gas compressors allegedly appraised by Adrian Hunter
whose company was sold to Weatherford Global.


 


POTENTIAL/THREATENED LITIGATION


 


1.                                       ALLEGED BREACH OF CONTRACT -
Siemens Westinghouse Power Company (“SWPC”) has engaged counsel and is
threatening litigation regarding 2 compressor units shipped to San Lorenzo,
Mexico.  UCI would seek recovery from
Sundyne (subject component manufacturer) for any damages ultimately awarded to
or paid in settlement to SWPC.


 


2.                                       ALLEGED DAMAGE TO PROPERTY – Landowner (Larry Stamp) who leases to one of
our customers (Dominion) alleges UCI’s employees
killed one or more of his “trophy” deer.


 


3.                                       ALLEGED DAMAGE TO PROPERTY – Owner of horse
alleges the animal died when it got tangled in barbed wire surrounding a
compressor station.


 


4.                                       ALLEGED BREACH OF CONTRACT – Possible claim
arising from alleged compressor failure of ICA  Fluor.


 


5.                                       See Item 2 on Schedule 7.02.


 


7.03 – 2





















 


Schedule
7.09 -  Taxes


 


None


 


7.09 – 1





















 


Schedule 7.10 - Titles, Etc.


 


Various
lease agreements for leased compressor units contain purchase options at
specified intervals during the lease term.


 


7.10 – 1





















 


Schedule
7.14
– Subsidiaries


 


	
   

  	
   

  	
  Company

  	
   

  	
  Jurisdiction of

  Incorporation/

  Organization

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1

  	
   

  	
  UCO
  Compression 2002 LLC

  	
   

  	
  Delaware

  
	
  2

  	
   

  	
  BRL
  Universal Equipment 2001 A, L.P. (UCI is a limited
  partner)

  	
   

  	
  Delaware

  
	
  3

  	
   

  	
  Universal
  Compression International, Inc.

  	
   

  	
  Delaware

  
	
  4

  	
   

  	
  Compressor
  Systems International, Inc.

  	
   

  	
  Delaware

  
	
  5

  	
   

  	
  Universal
  Compression International Ltd.

  	
   

  	
  Cayman
  Island

  
	
  6

  	
   

  	
  Compression
  Services de Mexico, S.A. de C.V.

  	
   

  	
  Mexico

  
	
  7

  	
   

  	
  PT
  Universal Compression Indonesia

  	
   

  	
  Indonesia

  
	
  8

  	
   

  	
  Enterra
  Compression Investment Company

  	
   

  	
  Delaware

  
	
  9

  	
   

  	
  Energy
  Dynamics de Venezuela, C.A.

  	
   

  	
  Venezuela

  
	
  10

  	
   

  	
  Universal
  Compression de Mexico, S.A. de C.V.

  	
   

  	
  Mexico

  
	
  11

  	
   

  	
  Universal
  Compression de Venezuela Unicom, C.A.

  	
   

  	
  Venezuela

  
	
  12

  	
   

  	
  Universal
  Compression Finance Company Ltd.

  	
   

  	
  Barbados

  
	
  13

  	
   

  	
  Universal
  Compression of Colombia Ltd.

  	
   

  	
  Cayman
  Island

  
	
  14

  	
   

  	
  Universal
  Compression Canadian Holdings, Inc.

  	
   

  	
  Delaware

  
	
  15

  	
   

  	
  UCO
  Compression Holding, L.L.C.

  	
   

  	
  Delaware

  
	
  16

  	
   

  	
  Universal
  Compression Services, LLC

  	
   

  	
  Delaware

  
	
  17

  	
   

  	
  Universal
  Compression International Holdings, S.L.U.

  	
   

  	
  Spain

  
	
  18

  	
   

  	
  Uniwhale
  Ltd.

  	
   

  	
  Cayman
  Island

  
	
  19

  	
   

  	
  Universal
  Compression (Ontario) Ltd.

  	
   

  	
  British
  Virgin Islands

  
	
  20

  	
   

  	
  Universal
  Compression del Peru S.R.L.

  	
   

  	
  Peru

  
	
  21

  	
   

  	
  Universal
  Compression Ltda.

  	
   

  	
  Brazil

  
	
  22

  	
   

  	
  Universal
  Compression (Thailand) Ltd.

  	
   

  	
  Thailand

  
	
  23

  	
   

  	
  Universal
  Compression Services de Venezuela, C.A.

  	
   

  	
  Venezuela

  
	
  24

  	
   

  	
  Universal
  Compression (Australia) Pty Ltd

  	
   

  	
  Australia

  
	
  25

  	
   

  	
  Universal
  Compression B.V.

  	
   

  	
  The
  Netherlands

  
	
  26

  	
   

  	
  Universal
  Compression Argentina S.A.

  	
   

  	
  Argentina

  
	
  27

  	
   

  	
  Uniwhale
  de Colombia E.U.

  	
   

  	
  Colombia

  
	
  28

  	
   

  	
  Universal
  Compression Holdings Canada Company

  	
   

  	
  Nova
  Scotia, Canada

  
	
  29

  	
   

  	
  Oceanic
  Compression Services Pty Ltd

  	
   

  	
  Australia

  
	
  30

  	
   

  	
  Universal
  Compression Bolivia Ltda.

  	
   

  	
  Bolivia

  
	
  31

  	
   

  	
  UC
  Canadian Partnership Holdings Company

  	
   

  	
  Nova
  Scotia, Canada

  
	
  32

  	
   

  	
  UC
  Canadian Partnership Minority Holdings Company

  	
   

  	
  Nova
  Scotia, Canada

  
	
  33

  	
   

  	
  Universal
  Compression Canada, Limited Partnership

  	
   

  	
  Nova
  Scotia, Canada

  



 


7.14 – 1





















 


Schedule
7.17
– Environmental Matters


 


1.                                       Three unregistered underground storage tanks
were discovered in Roanoke, Louisiana during the acquisition of Gas Compression
Services, Inc. (GCSI) in 2001. Subsequent to the
acquisition, the tanks were removed and the property was sold.  However, US Borrower retained the
responsibility for official closure of this issue in accordance with Louisiana
Department of Environmental Quality (LDEQ) Risk
Evaluation Corrective Action Program (RECAP) standards.  US Borrower has completed a Site
Investigation in accordance with RECAP and additional soil borings and soil
removal will likely be required.


 


2.                                       Two registered Leaking Petroleum Storage
Tanks (LPST) were removed from operation at the Brittmoore facility in Houston in 1992.  Since removal of the LPST,
ground water monitoring wells have been installed and various risk evaluations
and assessments performed to determine the impacts to ground water.  Ground water monitoring continues on a
quarterly basis.  At least one additional
round of sampling will be performed in 2004 prior to submission of a Site
Closure Request Form to the Texas Commission on Environmental Quality (TCEQ).


 


3.                                       In June 2004, the City of Oklahoma City sent
the Yukon, Oklahoma facility a Notice of Violation letter for violations of
their industrial wastewater discharge permit. Corrective actions are
ongoing and will result in the installation of additional equipment to reduce
oil and grease concentrations in the discharge.


 


4.                                       In 2004 US Borrower completed two Site
Investigations in accordance with LDEQ RECAP
standards on three leased tracts of property in Lafayette, LA.  The property leases were assumed following
the acquisition of IEW Compression, Inc. and have
since been terminated.  The
investigations included soil impacts. 
During the investigations, the landowner hired his own consultant and an
attorney to represent him in the matter claiming that his property was damaged.  However, US Borrower has since completed its
investigations and has received “No Further Action-At This Time” (NFA-ATT) letters from the LDEQ in
January and April 2004.


 


5.                                       Some company facilities may be required to
update their training programs to encompass waste management, spill prevention,
control and countermeasure, and storm water pollution prevention to meet
Resource Conservation Recovery Act (RCRA) and Clean
Water Act (CWA) requirements. US Borrower is
currently developing an Environmental Management System (EMS) that will
establish the procedures and work practices needed to meet these requirements
companywide.


 


6.                                       Some company facilities may be required to
update their Storm Water Pollution Prevention Plans (SW3P)
and Spill Prevention Control and Countermeasure Plans (SPCC)
to meet Resource Conservation Recovery Act (RCRA) and
Clean Water Act (CWA) requirements. US Borrower is
currently developing an Environmental Management System (EMS) that will
establish the procedures and work practices needed to meet these requirements
companywide.


 


7.                                       Certain compressor units may have been
operated by customers without applying for and obtaining the appropriate air
permits in the States in which the units were installed. Such events may result
in the issuance of Notice of Violation to our customer and to the company.


 


8.                                       Weatherford U.S.,L.P.
(Weatherford) retained responsibility for a ground water investigation at 5200
I-20 West in Midland, Texas following US Borrower’s acquisition of Weatherford
Global Compression Services in 2002. 
Weatherford is currently working with the Texas


 


7.17 – 1





















 


Commission on Environmental Quality to define the extent of ground
water impact at the facility in accordance with the Texas Risk Reduction
Program.


 


7.17 – 2





















 


Schedule 7.19 - Insurance


 


Provided
directly to the US Administrative Agent.  Any Lender may contact the US Administrative
Agent for a copy of this Schedule 7.19.


 


7.19 – 1





















 


Schedule
7.20 -  Hedging
Agreements


(as of 12/31/04)


 


	
   

  	
   

  	
  NOTIONAL

  	
   

  	
  EFFECTIVE

  DATE

  	
   

  	
  MATURITY

  DATE

  	
   

  	
  TYPE

  	
   

  	
  COUNTER

  PARTY

  	
   

  	
  NET

  MARK TO

  MARKET

  VALUE

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  $

  	
  86,044,175

  	
   

  	
  06/01/04

  	
   

  	
  01/20/13

  	
   

  	
  Floating
  => Fixed

  	
   

  	
  Wachovia

  	
   

  	
  $

  	
  (4,437,645

  	
  )

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  1ML=>
  5.21%

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  ABS Facility

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  $

  	
  50,000,000

  	
   

  	
  03/03/04

  	
   

  	
  05/15/10

  	
   

  	
  Fixed =>
  Floating

  	
   

  	
  Deutsche

  Bank

  	
   

  	
  $

  	
  (847,705

  	
  )

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  7.25% => 6ML +

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  3.19

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  7 1⁄4 Notes

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  $

  	
  50,000,000

  	
   

  	
  03/03/04

  	
   

  	
  05/15/10

  	
   

  	
  Fixed =>
  Floating

  	
   

  	
  Wachovia

  	
   

  	
  $

  	
  (1,020,775

  	
  )

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  7.25% => 6ML +

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  3.225

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  7 1⁄4 Notes

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


7.20 – 1





















 


Schedule
7.21
- Restriction on Liens


 


1.                                       All agreements or arrangements related to or
entered in connection with the ABS Facility, including without limitation, that
certain Intercreditor and Collateral Agency Agreement
dated as of December 31, 2002, among UCI, UCO Compression 2002 LLC and BRL
Universal Compression Funding I 2002, L.P., as Owners, Wells Fargo Bank
Minnesota, National Association, as Indenture Trustee, Wachovia Bank, National
Association, as Bank Agent, and the financial institutions that may from time
to time become parties thereto, and JPMorgan Chase
Bank, N.A. fka Bank One, N.A., as Intercreditor Collateral
Agent.


 


2.                                       All agreements or arrangements related to or
entered in connection with the 8 7/8 % Notes and Existing Tranche
B Loan Facility.


 


3.                                       All agreements or arrangements related to or
entered in connection with the 7 1/4% Notes.


 


7.21 – 1





















 


Schedule
10.01
- Debt


 


1.                                       7 1/4% Notes due in 2010 subject to fixed to
floating swaps as noted on Schedule 7.20 and having an outstanding principal
balance of $175,000,000.


 


2.                                       8 7/8 % Notes bearing interest at 8.875% due
in February 2008 and having an outstanding principal balance of $440,000,000
and the Existing Tranche B Loan Facility notes which
will be paid off as of the Closing Date. 
The 8 7/8% Notes will be paid off on the Term Loan Funding Date.


 


3.                                       ABS Facility notes due in January 2010 and
subject to interest at a variable rate of LIBOR which is partially fixed
through the use of an interest rate swap as noted on Schedule 7.20 and having
an outstanding principal balance of $200,000,000 as of the Closing Date.


 


4.                                       Various Leases between GE Business Asset
Funding and US Borrower as described in the following table: 


 




	
  Account

  Number

  	
   

  	
  Orig. Date

  	
   

  	
  Due Date

  	
   

  	
  Outstanding

  Principal

  Balance

  12/31/04

  	
   

  	
  Rate

  	
   

  	
  Collateral

  	
   

  
	
  1450-004

  	
   

  	
  07/31/98

  	
   

  	
  07/31/08

  	
   

  	
  $

  	
  217,869

  	
   

  	
  9.5

  	
  %

  	
  5 GC Units

  	
   

  
	
  1450-005

  	
   

  	
  09/30/98

  	
   

  	
  09/30/08

  	
   

  	
  $

  	
  216,740

  	
   

  	
  9.5

  	
  %

  	
  3 GC Units

  	
   

  
	
  4699-003

  	
   

  	
  09/30/98

  	
   

  	
  09/30/08

  	
   

  	
  $

  	
  483,694

  	
   

  	
  3.9

  	
  %

  	
  3 GC Units

  	
   

  






 


5.                                       Capital lease with Steelcase
Financial Services, Inc. in the original lease amount of $2,799,312.07 and
having a balance of $756,629 as of December 31, 2004.


 


6.                                       Miscellaneous equipment leases with Canon
Financial Services, Inc., CTI Financial and IBM
Credit LLC noted on Schedule 10.02.


 


10.01 – 1





















 


Schedule
10.02
- Liens


 


1.                                       Liens securing the equipment leased pursuant
to that certain Master Equipment Lease Agreement, dated as of May 18, 1998,
between General Electric Capital Business Asset Funding Corporation (as
successor in interest to MetLife Capital, Limited Partnership) and Gas
Compression Services, Inc. (now known US Borrower), together with three
equipment leasing schedules entered into thereunder
and forming a part thereof and secured by financing statements filed with the
Secretary of State noted:


 


	
  Secured Party

  	
   

  	
  Date Filed

  	
   

  	
  State and UCC File No.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  General
  Electric Capital Business Asset

  Funding Corporation

  	
   

  	
  December
  17, 1999

  	
   

  	
  TX
  — 9900248937

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  General
  Electric Capital Business Asset

  Funding Corporation

  	
   

  	
  June
  14, 2000

  	
   

  	
  TX
  — 0000519011

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  General
  Electric Capital Business Asset

  Funding Corporation

  	
   

  	
  November
  8, 2000

  	
   

  	
  TX
  — 0000620485

  



 


2.               The following miscellaneous equipment leases
secured by financing statements filed with the Secretary of State noted:


 


	
  Secured Party

  	
   

  	
  Date Filed

  	
   

  	
  State and UCC File No.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Steelcase
  Financial Services, Inc.

  	
   

  	
  July
  12, 2002

  	
   

  	
  TX
  — 020036924026

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Canon
  Financial Services, Inc.

  	
   

  	
  May
  19, 2003

  	
   

  	
  TX
  — 030028145457

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Canon
  Financial Services, Inc.

  	
   

  	
  July
  28, 2003

  	
   

  	
  TX
  — 030036006523

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CTI
  Financial

  	
   

  	
  July
  21, 2003

  	
   

  	
  TX
  — 030035082394

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  IBM
  Credit LLC

  	
   

  	
  April
  6, 2004

  	
   

  	
  TX
  — 04-0063267927

  



 


3.               Liens securing the ABS Facility secured by
all assets of UCO Compression 2002, LLC, a wholly
owned subsidiary of UCI, and BRL
Universal Compression Funding I 2002, L.P., an unaffiliated third party.  The assets securing this facility include,
without limitation, approximately $370,926,470 of compressor equipment, accounts,
contracts, general intangibles and other related assets thereto.


 


4.               Liens securing the Term Loan B Existing
Indebtedness and the Existing Tranche B Loan Facility
secured by all assets of BRL Universal Equipment 2001
A, L.P., of which UCI is the sole limited
partner.  The assets securing this
facility include, without limitation, approximately $540,353,661 of compressor
equipment, accounts, contracts, general intangibles and other related assets
thereto.  These Liens will be released
upon payment in full of such indebtedness on the Term Loan Funding Date.


 


5.               Liens securing the Notes.


 


6.               Liens securing the Existing Credit Agreement.


 


10.02 – 1





















 


Schedule 10.03 - Investments, Loans and
Advances


 


Investments in Subsidiaries or related entities in
connection with the ABS Facility and 8 7/8 % Notes and Existing Tranche B Loan Facility.


 


10.03 – 1





















 


Schedule 10.16 - Transactions with
Affiliates


 


Concurrently
with Holdings’s acquisition of Weatherford Global
Compression Services, L.P. in February 2001, Holdings entered into a
registration rights agreement with Weatherford International Ltd. (“Weatherford”).  In connection with this agreement, Holdings
filed a registration statement on Form S-3  to register Weatherford’s remaining
6,750,000 shares of common stock in January 2005.


 


10.16 – 1