exhibit10i.htm


    EXHIBIT
      10(i)

     

    WAIVER
      AND SECOND AMENDMENT TO CREDIT AGREEMENT AND FIRST AMENDMENT TO BORROWER
      SECURITY AGREEMENT

     

    THIS
      WAIVER AND SECOND AMENDMENT TO CREDIT AGREEMENT AND FIRST AMENDMENT TO BORROWER
      SECURITY AGREEMENT (this “Amendment”) is entered into
      as of September 19, 2007, between SOUTH HAMPTON RESOURCES, INC., a Texas
      corporation (“Borrower”), and BANK OF AMERICA, N.A., a
      national banking association
      (“Lender”).  Capitalized terms used but not
      defined in this Amendment have the meaning given them in the Credit Agreement
      (defined below).

     

    RECITALS

     

    A.           Borrower
      and Lender entered into that certain Credit Agreement dated as of May 25, 2006
      (as amended by that certain Waiver and First Amendment to Credit Agreement
      dated
      as of December 31, 2006, and as further, restated or supplemented, the
“Credit Agreement”), under which Lender agreed to
      provide to Borrower, subject to the terms and conditions contained therein,
      a
      revolving credit facility.

     

    B.           To
      secure Borrower’s obligations and indebtedness under the Credit Agreement and
      the other Loan Documents, Borrower executed and delivered that certain Security
      Agreement dated as of even date with the Credit Agreement covering the
      collateral identified therein (as amended, restated or otherwise modified from
      time to time, the “Borrower Security
      Agreement”).

     

    C.           A
      certain Default has occurred as a result of TOCCO’s failure to comply with the
      maximum Unfinanced Capital Expenditure covenant for the period ended March
      31,
      2007 pursuant to Section 10.3 of the Credit Agreement
      (the “Existing Default”).

     

    D.           Borrower
      has requested that Lender waive the Existing Default, make the Term Loan
      available to Borrower pursuant to Section 5.2(b) of
      the Credit Agreement (before giving effect to this Amendment), and amend the
      Borrower Security Agreement, and Lender has agreed to waive the Existing
      Default, make the Term Loan available to Borrower pursuant to
Section 5.2(b) of the Credit Agreement (before giving
      effect to this Amendment) and to make other amendments to the Credit Agreement,
      and amend the Borrower Security Agreement, in each case subject to the terms
      and
      conditions of this Amendment.

     

    NOW
      THEREFORE, for good and valuable consideration, the receipt and sufficiency
      of
      which are acknowledged, the undersigned hereby agree as follows:

     

    1.  Waiver
      of Existing Default.  Subject to the conditions set out in this
      Amendment, Lender hereby (a) waives any violation of, or noncompliance with,
      any
      provision of any Loan Document caused solely by the Existing Default, and (b)
      agrees not to exercise any of its Rights available under the Loan Documents
      solely as a result of any such violation or noncompliance described in
clause (a) of this Section
      1.  Except as set out in the immediately preceding
      sentence, Borrower hereby agrees that such waiver does not constitute a waiver
      of any present or future violation of or noncompliance with any provision of
      any
      Loan Document or a waiver of Lender’s right to insist upon strict compliance
      with each term, covenant, condition, and provision of the Loan
      Documents.

     

    2.  Amendments
      to Credit Agreement.   The Credit Agreement is hereby amended
      as follows:

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (a)  The
      Recitals to the Credit Agreement are hereby deleted in their entirety and
      replaced with the following Recitals:

     

    “A.           Borrower
      has requested that Lender extend credit to Borrower (i) in the maximum principal
      amount of $12,000,000 in the form of a revolving credit facility that includes
      a
      $3,000,000 subfacility for Swap Contracts, and a $9,000,000 subfacility for
      the
      issuance of LCs, and (ii) in the maximum principal amount of up to $10,000,000
      in the form of an advancing term loan facility to finance the Subject Expansion
      (as defined below).

    


    B.           Lender
      is willing to extend the revolving credit facility, extend the Swap Contract
      subfacility, extend the letter of credit subfacility, and extend the termloan
      facility, in each case on the terms and conditions of this
      Agreement.

    


    Accordingly,
      Borrower and Lender agree as follows:”

    


    (b)  Section
      1.1 of the Credit Agreement is hereby amended to delete the
      defined terms “Permitted Liens”, “Security Documents”, “Term Committed Amount”,
“Term Loan Date”, and “Term Loan Maturity Date”, and replaced them with the
      defined terms as follows:

     

    “Permitted
      Liens means (a) Liens securing the Obligation, (b) Liens existing
      on the Closing Date and described on Schedule 2,
      (c) Liens listed on Exhibit B to the Deed of Trust, (d) Liens which secure
      purchase money Debt and capital lease obligations permitted under
clause (c) of the definition of Permitted Debt, (e) easements,
      rights-of-way, encumbrances and other restrictions on the use of real property
      which do not materially impair the use thereof, (f) Liens for Taxes;
provided that, (i) no amounts are due and payable and no Lien has
      been filed or agreed to, or (ii)  the validity or amount thereof is being
      contested in good faith by lawful proceedings diligently conducted, and reserve
      or other provision required by GAAP has been made, (g) judgments and attachments
      permitted by Section 11.4, (h) pledges or deposits
      made to secure payment of workers’ compensation, unemployment insurance or other
      forms of governmental insurance or benefits or to participate in any fund in
      connection with workers’ compensation, unemployment insurance, pensions or other
      social security programs, (i) rights of offset or statutory banker’s Lien
      arising in the ordinary course of business in favor of commercial banks;
      provided that, any such Lien shall only extend to deposits and property in
      possession of such commercial bank and its Affiliates, (j) good-faith pledges
      or
      deposits made in the ordinary course of business to secure (i) performance
      of bids, tenders, trade contracts (other than for the repayment of
      borrowed money) or leases, (ii) statutory obligations, or (iii) surety or
      appeal bonds, or indemnity, performance or other similar bonds, which, in the
      aggregate under this clause (j), do not exceed $250,000 at any time,
      and (k) Liens (other than for Taxes) imposed by operation of law
      (including Liens of mechanics, materialmen, warehousemen, carriers and landlords
      and similar Liens); provided that, (i) the validity or amount
      thereof is being contested in good faith by lawful proceedings diligently
      conducted, (ii) reserve or other provision required by GAAP has been made,
      and (iii) within 60 days after the entry hereof, levy and execution thereon
      have been (and continue to be) stayed or payment thereof is covered in full
      by
      insurance (subject to the customary deductible).

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    


    Security
      Documents means all Security Agreements, all Deeds of Trust, all
      Assignments of Contracts, and all other documents executed in connection
      therewith to create or perfect a Lien on the Collateral.

    


    Term
      Committed Amount means the lesser of (a) the aggregate
      amount of all invoices paid with the proceeds of the Term Loan for the Subject
      Expansion, and (b) $10,000,000.

     

    Term
      Loan Date means the effective date of the Second Amendment to this
      Agreement.

     

    Term
      Loan Maturity Date means October
      31, 2018.”

    


    (c)  Section
      1.1 of the Credit Agreement is hereby amended to add the following
      defined terms in their appropriate alphabetical order as follows:

     

    “Appraisal
      means a written appraisal of the Subject Property prepared on
      an
“as-completed” basis by an independent MAI appraiser reasonably acceptable to
      Lender and properly certified by the State of Texas in accordance with Title
      XI
      of the Financial Institutions Reform, Recovery and Enforcement Act of 1989,
      or,
      at Lender’s option, by Lender’s “in-house” appraiser.  Such Appraisal
      shall be ordered by Lender directly and shall be in Proper Form.

     

    Assignment
      of Contracts means the Assignment of Rights under Construction
      Contracts, Permits, Plans and Contracts executed by Borrower to Lender in
      connection with this Agreement in Proper Form.

     

    construction
      and constructed means, as applicable, the development,
      demolition, construction, erection and installation of any Improvements on
      the
      Subject Property pertaining to the Subject Expansion.

     

    Construction
      Contracts means all construction contracts between Borrower and
      any contractor or subcontractor for the construction of any Improvements to
      the
      Subject Property pertaining to the Subject Expansion, contracts between any
      contractor and any subcontractor, and contracts between any of the foregoing
      and
      any other person or entity relating to rendering of services or furnishing
      of
      materials in connection with the construction of such Improvements.

     

    Conversion
      Date is the date the Term Loan converts from a multiple advance
      loan to a “mini-perm” term loan which is the date that all of the conditions
      precedent in Section 5.5 below have been satisfied;
provided, that, the Conversion Date may not
      occur after
      December 1, 2008.

     

    Force
      Majeure means any event or circumstance, or combination of events
      or circumstances, that is beyond the control of the party hereto claiming force
      majeure, which materially and adversely affects the ability of such party to
      perform its obligations under or pursuant to this Agreement, including, without
      limitation, (a) any explosions, implosions, fires, conflagrations, accidents,
      epidemics, contamination, (b) floods, hail, tornadoes, hurricanes, (c) acts
      of
      war (whether declared or not declared), blockade or embargo, (d) acts of public
      enemy, acts of terrorism, riot, public disorder or violent demonstrations,
      and
      (e) strikes or failure of supply of materials, labor, fuel, power, equipment,
      supplies or transportation.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Impositions
      means all Taxes, including: real estate and personal property ad valorem Taxes;
      water, gas, sewer, electricity and other utility rates and charges; charges
      imposed pursuant to any subdivision, planned unit development, or condominium
      declaration or restrictions; charges for any easement, license, or agreement
      maintained for the benefit of the Subject Property; and all other Taxes, standby
      fees, charges, and assessments and any interest, costs, or penalties of any
      kind
      with respect to the Subject Property which may be assessed, levied, or imposed
      upon the Subject Property or the ownership, use, occupancy, or enjoyment
      thereof.

     

    Improvements
      means all buildings, structures, open parking areas, amenities, and other
      improvements and any and all accessions, additions, replacements, substitutions,
      or alterations thereof or appurtenances thereto, currently or subsequently
      situated, placed, or constructed upon the Subject Property, or any part
      thereof.

     

    Insurance
      Policies means (a) owner’s policies of comprehensive general
      public liability insurance, including worker’s compensation insurance if
      required by law; (b) hazard insurance against all risks of loss, including
      fire,
      water damage, or collapse, in an amount not less than the full replacement
      cost
      of all Improvements, including the cost of debris removal, with annual agreed
      amount endorsement (or waiver of co-insurance clause) and which is sufficient
      at
      all times to prevent Borrower from becoming a co-insurer; (c) if the Property
      is
      in a “Flood Hazard Area,” a flood insurance policy, or binder therefor, in an
      amount equal to the Term Loan Committed Amount, or the maximum amount available
      under the Flood Disaster Protection Act of 1973 and regulations issued
      pursuant thereto, as amended from time to time, whichever is less, in form
      complying with the “insurance purchase requirement” of such Act; and (d) such
      other insurance, if any, as Lender may reasonably require, including but not
      limited to broad form boiler and machinery insurance on all equipment and
      objects customarily covered thereby if there are pressure fired vehicles within
      the Subject Property.  All Insurance Policies shall (i) be issued and
      maintained in form, of types and amounts (with co-insurance and deductibles)
      as
      is customary in the case of similar businesses, and by companies satisfactory
      to
      Lender, (ii) contain a mortgagee clause (without contribution) in favor of
      Lender with loss proceeds payable to Lender as its interest may appear, (iii)
      require not less than 30 days prior written notice to Lender of any cancellation
      or change of coverage, and (iv) provide that no act of the insured or any
      occupant, and no occupancy or use of the Subject Property for purposes more
      hazardous than permitted by the terms of the policy, will affect the validity
      or
      enforceability of the insurance as respects Lender.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Subject
      Expansion means, collectively, the development, construction,
      equipping and installation of certain Improvements on the Subject Property
      to
      expand Borrower’s penhex manufacturing capacity as disclosed to Lender in
      connection with Lender’s underwriting and credit approval of the Term
      Loan.

     

    Termination
      Date means the final date that Loans may be made under the Term
      Loan, which date shall be the earlier of (a) the Conversion Date, and
      (b) the occurrence of a Default.

     

    Title
      Company means the title insurance company, reasonably acceptable
      to Lender, issuing the Title Insurance Policy.

     

    Title
      Insurance Policy means a mortgagee title insurance policy, as
      Lender may require, issued in favor of Lender by the Title Company on behalf
      of
      the Title Company’s underwriter, on a coinsurance or reinsurance basis (with
      direct access in Texas) if and as required by Lender in an amount equal to
      one
      hundred one hundred percent (100%) of the face amount of the Term Note, in
      such
      form as may be prescribed by applicable Governmental Requirements and as shall
      be satisfactory to Lender, certifying that good and indefeasible fee title
      to
      the Subject Property is vested in Borrower, and that Lender’s Lien on the
      Subject Property is a first priority lien thereon, subject only to a pending
      disbursements clause and exceptions acceptable to Lender and required by
      applicable state title insurance regulations.

     

    (d)  Section
      2.1 of the Credit Agreement is hereby deleted in its entirety and
      replaced with Section 2.1 as follows:

     

    “2.1           Term
      Loan.  Subject to the terms and conditions of this Agreement,
      including without limitation, the loan procedures set out in Section
      2.3 below, Lender agrees to lend to Borrower multiple Loans under
      the Term Loan which Borrower may borrow, and prepay but which may not be
      re-borrowed under this Agreement (collectively, the “Term
      Loan”).”

     

    (e)  Section
      2.3 of the Credit Agreement is hereby deleted in its entirety and
      replaced with Section 2.3 as follows:

     

    “2.3           Loan
      Procedures.

     

    (a)           Subject
      to compliance with Section 5, Borrower may
      request a Loan under the Revolving Credit Facility by submitting a Loan Request
      to Lender.  A Loan Request is irrevocable and binding on
      Borrower.  Each Loan Request must be received by Lender no later than
      10:00 a.m. on (a) the third Business Day preceding the proposed Loan Date
      for a LIBOR Loan and (b) the proposed Loan Date for a Base Rate
      Loan.  Loans may be outstanding as either Base Rate Loans or LIBOR
      Loans.  Each Loan under the Revolving Credit Facility is subject to
      the following conditions:

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (i)           each
      Loan must occur on a Business Day and no later than the Business Day immediately
      preceding the Revolving Credit Termination Date;

     

    (ii)           each
      Loan (unless the remaining amount under clause (c) below is less) must
      be in an amount not less than $100,000 (if a Base Rate Loan) or
      $100,000 (if a LIBOR Loan) or a greater integral multiple of
      $10,000;

     

    (iii)           no
      Loan may exceed an amount equal to the lesser of (a) the excess of the
      Revolving Committed Amount over the Revolving Credit Exposure and (b) the excess
      of the Borrowing Base over the Revolving Credit Exposure; and

     

    (iv)           after
      giving effect to any Loan, the aggregate Revolving Credit Exposure may not
      exceed the Revolving Credit Limit.

     

    (b)           Subject
      to compliance with Section 5, Borrower may
      request a Loan under the Term Loan by submitting a Loan Request to
      Lender.  A Loan Request is irrevocable and binding on
      Borrower.  Each Loan Request must be received by Lender no later than
      10:00 a.m. on (a) the third Business Day preceding the proposed Loan Date
      for a LIBOR Loan and (b) the proposed Loan Date for a Base Rate
      Loan.  Loans may be outstanding as either Base Rate Loans or LIBOR
      Loans.  Each Loan under the Term Loan is subject to the following
      conditions:

     

    (i)  Each
      Loan
      under the Term Loan must occur on a Business Day and no later than the Business
      Day immediately preceding the Conversion Date;

     

    (ii)           Each
      Loan (unless the remaining amount under clause (d) below is less) must
      be in the amount shown on the accompanied invoice submitted for payment with
      the
      proceeds of such Loan but in any event no Loan may be for less than
$10,000;

     

    (iii)           Each
      Loan Request shall be accompanied by the invoice or invoices submitted for
      payment therefore, and no Loan under the Term Loan may exceed the aggregate
      amount of such invoice or invoices;

     

    (iv)           No
      more than one Loan under the Term Loan may be made during a one month period;
      and

     

    (v)           The
      Principal Debt may not exceed the Term Loan Committed Amount after giving effect
      to each Loan under the Term Loan.”

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (f)  Section
      2.4(c) of the Credit Agreement is hereby deleted in its entirety
      and replaced with Section 2.4(c) as
      follows:

     

    “(c)           If
      the Term Principal Debt ever exceeds the Term Loan Committed Amount, then
      Borrower shall promptly prepay the Term Principal Debt in an amount equal to
      the
      excess, together with all accrued and unpaid interest on the principal amount
      prepaid.”

    


    (g)  Section
      3.2 of the Credit Agreement is hereby deleted in its entirety and
      replaced with Section 3.2 as follows:

     

    “3.2
      Payments

     

     

    (a)           Interest
      Payments.  Accrued and unpaid interest on each Loan in respect of
      the Principal Debt is due and payable in arrears on the first Business Day
      of
      each month beginning with the first Business Day of June 2006, and continuing
      on
      the first Business Day of each month thereafter through the Revolving Credit
      Termination Date.

     

    (b)           Principal
      Payments; Swap Contracts.

     

    (i)           On
      the Conversion Date, the Term Principal Debt shall amortize based on a ten
      year
      commercial style amortization method  and installments of the Term
      Principal Debt shall be due and payable on the first Business Day of each
      January, April, July, and October commencing with the first such date following
      the Conversion Date.

     

    (ii)           The
      Revolving Principal Debt is due and payable on the Revolving Credit Termination
      Date.

     

    (iii)           The
      Swap Termination Value (if any) owing by Borrower when such Swap Contract has
      been closed out or otherwise terminated shall be due and payable in full on
      the
      date of such closing out or termination and otherwise in accordance with the
      terms and conditions of the Swap Contract.”

     

    (h)  Section
      3.4 of the Credit Agreement is hereby deleted in its entirety and
      replaced with Section 3.4 as follows:

     

    “3.4
      Interest and Default Rate.

    


    (a)           Except
      as otherwise provided in this Agreement, Loans under the Revolving Credit
      Facility shall accrue interest at an annual rate equal to the lesser of
      (i) at Borrower’s option (A) for a Base Rate Loan, the sum of the Base
      Rate plus the Applicable Margin for Base Rate Loans, or (B) for a LIBOR
      Loan, the sum of LIBOR plus the Applicable Margin for LIBOR
      Loans, and (ii) the Maximum Rate.  Each change in the Base Rate,
      LIBOR, or the Maximum Rate is effective as of the effective date of such change
      without notice to Borrower or any other Person.

    


    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (b)           Except
      as otherwise provided in this Agreement, Loans under the Term Loan shall accrue
      interest at an annual rate equal to the lesser of (i) at
      Borrower’s option (A) for a Base Rate Loan, the sum of the Base Rate plus
      the Applicable Margin for Base Rate Loans, or (B) for a LIBOR Loan, the
sum of LIBOR plus the Applicable Margin for LIBOR Loans, and
      (ii) the Maximum Rate.  Each change in the Base Rate, LIBOR, or
      the Maximum Rate is effective as of the effective date of such change without
      notice to Borrower or any other Person. Notwithstanding anything to the contrary
      herein, the Applicable Margin for Loans under the Term Loan shall be based
      on
      Level III until Lender receives the Compliance Certificate and Current
      Financials for the period ending September 30, 2007.

    


    (c)           To
      the extent permitted by Law, while a Default exists, the Obligation shall accrue
      interest at the lesser of (i) the Default Rate and (ii) the
      Maximum Rate, until all past due amounts are paid (whether payment is made
      before or after entry of a judgment or the Default is otherwise cured or
      waived).  Subject to Section 3.7, if a
      Default exists, Lender may, in its sole discretion, to the extent permitted
      by
      Law, add accrued and unpaid interest to the Principal Debt and such amount
      will
      accrue interest until paid at the applicable interest rate.”

    


    (i)  Section
      3.6(a) of the Credit Agreement is hereby deleted in its entirety
      and replaced with Section 3.6(a) as
      follows:

     

    “(a)           When
      Borrower requests any LIBOR Loan, Borrower may elect an Interest Period of,
      at
      Borrower’s option, one, two, three or six months, subject to the following
      conditions:  (i) no Interest Period may extend beyond the Revolving
      Credit Termination Date (in respect of Loans under the Revolving Credit
      Facility) or the Term Loan Maturity Date (in respect of Loans under the Term
      Loan); and (ii) no more than 3 Interest Periods may be in effect at any time
      under the Revolving Credit Facility and no more than 3 Interest Period may
      be in
      effect at any time under the Term Loan.”

    


    (j)  Section
      5.2 of the Credit Agreement is hereby deleted in its entirety and
      replaced with Section 5.2 as follows:

     

    “5.2           Conditions
      to all Credit Extensions

    .  Lender
      will not be obligated to make any Credit Extension unless on the applicable
      Loan
      Date or date of such Credit Extension (and after giving effect to the requested
      Loan, LC, or Swap Contract, as the case may be):  (a) Lender has
      timely received a Loan Request, LC Application, or Swap Contract, as the case
      may be, (b) all of the representations and warranties of the Companies in
      the Loan Documents are true and correct in all material respects (except to
      the
      extent that the representations and warranties speak to a specific date),
      (c) Lender has received and continues to maintain evidence of insurance as
      set out in Section 8.6 (including certificates
      and endorsements); (d) no Material Adverse Event exists, (e) no
      Default or Potential Default exists or will result from such Credit Extension;
      and (f) in respect of any Loan under the Term Loan, Borrower shall procure
      and
      deliver to Lender releases or waivers of mechanic’s liens, and invoices, or paid
      receipts if requesting reimbursements, of each party who has furnished materials
      or services or performed labor of any kind in connection with the construction
      of any of the Improvements and, in each case, whose aggregate invoices exceed
      $100,000; such lien waivers shall be in Proper Form.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Each
      Loan
      Request, LC Application, or Swap Contract delivered to Lender constitutes the
      representation and warranty by the Companies that the statements in clauses
      (b), (c),(d) and (e) above are true and correct in all
      material respects.”

     

    (k)  A
      new Section 5.5 of the Credit Agreement is hereby
      added to the Credit Agreement in its numerical order as follows:

     

    “5.5  Condition
      to Conversion to Mini “Perm” Loan

    .  Lender
      will have no obligation to convert the Term Loan to a “mini- perm” loan on the
      Conversion Date unless on or before the Conversion Date the following additional
      conditions shall have been satisfied, to the extent required by
      Lender:

     

    (a)           Borrower
      shall have certified to Lender that construction has been completed in a good
      and workmanlike manner, in compliance in all material respects with applicable
      requirements of all Governmental Authorities and substantially in accordance
      with the Plans and Specifications;

     

    (b)           To
      the extent required by applicable Governmental Authorities for the use and
      occupancy of the Improvements, evidence of code compliance and other applicable
      permits and releases shall have been issued to Lender in Proper Form with
      respect to the construction of the Improvements and copies thereof have been
      furnished to Lender;

     

    (c)           Lender
      shall have received an “as-built” survey in Proper Form showing the location of
      the Improvements and other matters reasonably requested by Lender;

     

    (d)           Lender
      shall have received a final affidavit from the contractor and full and complete
      releases of lien from the contractor and each subcontractor of and supplier
      to
      the contractor with respect to work performed and/on materials supplied in
      the
      construction of the Improvements, all of such documentation to be in Proper
      Form;

     

    (e)           A
      valid notice of completion shall have been recorded in the real property records
      of the county where the Subject Property is located;

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (f)           Lender
      shall have received a satisfactory endorsement to its Title Insurance Policy;
      and

     

    (g)           A
      certificate from Borrower to Lender that the statements in clauses (b),
      (c),(d) and (e) of Section 5.2
      above are true and correct.”

     

    (l)  Section
      6.1 of the Credit Agreement is hereby deleted in its entirety and
      replaced with Section 6.1 as follows:

     

    “6.1
      Collateral.  The complete payment and performance of the
      Obligation shall be secured by all of the items and types of property
      (collectively, the “Collateral”) described as
      collateral in the Security Agreement, and “Mortgaged Property” in the Deed of
      Trust.  Each Company shall execute all applicable Security Documents
      necessary to grant in favor of Lender a Lien upon all of the Collateral it
      owns.”

    


    (m)  Section
      6.5 of the Credit Agreement is hereby deleted in its entirety and
      replaced with Section 6.5 as follows:

     

    “6.5
      [Intentionally Omitted.]”

    


    (n)  Section
      7.13 of the Credit Agreement is hereby deleted in its entirety and
      replaced with Section 7.13 as follows:

     

    “7.13  Purpose
      of Credit Facilities. Borrower will use the proceeds of the Term Loan as
      disclosed in writing to Lender and for no other purpose.  Borrower
      will use the proceeds of the Revolving Credit Facility for its working capital
      and general corporate purposes and to refinance certain Debt as disclosed to
      Lender.  Borrower will use the proceeds of the Term Loan for the
      Subject Expansion and no other purpose.  No part of the proceeds of
      the Term Loan or the Revolving Credit Facility will be used, directly or
      indirectly, for a purpose that violates any Law, including the provisions of
      Regulation U.”

    


    (o)  New
      Sections 7.20 through 7.22
      of the Credit Agreement are hereby added to the Credit Agreement in their
      appropriate numerical order as follows:

     

    “7.20                      Permits
      and Restrictions

    .  On
      or before the date construction commences on the Improvements for the Subject
      Expansion and thereafter, all utility, building, health, and operating permits
      (if any) required for the construction and operation of the Subject Expansion
      will have been obtained and will be in effect.  There are no deed
      restrictions which have not been effectively waived which would prohibit, limit,
      or interfere with Borrower’s use of the Subject Property or Borrower’s operation
      of the Subject Property, before and after giving effect to the Subject
      Expansion.

    


    7.21           Sufficient
      Funds

    .  Sufficient
      funds are available to Borrower in addition to proceeds of the Term Loan to
      pay
      all costs of the Subject Expansion.

    


    7.22           Other
      Liens

    .  Prior
      to the recordation of the Deed of Trust, no work of any kind (including
      destruction or removal of any existing improvements, site work, clearing,
      grading, grubbing, draining or fencing of the Subject Property) has been or
      will
      be commenced or performed on the Subject Property relative to the Subject
      Expansion or any other ongoing construction work thereon, no equipment or
      material has been or will be delivered to or placed upon the Subject Property
      for any purpose whatsoever, and no contract (or memorandum or affidavit thereof)
      for the supplying of labor, materials, or services for the design or
      construction of the Improvements relative to the Subject Expansion, or the
      surveying of the Subject Property or Improvements, nor any affidavit or notice
      of commencement of construction of the Improvements, has been or will be
      executed or recorded, which could cause a mechanic’s or materialman’s Lien or
      similar Lien to achieve priority over the Deed of Trust or the rights of Lender
      thereunder.”

    


    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (p)  New
      Sections 8.14 through 8.19
      of the Credit Agreement are hereby added to the Credit Agreement in their
      appropriate numerical order as follows:

     

    “8.14.                      Appraisal.  From
      time to time after the Closing Date, Lender may obtain an Appraisal of the
      Subject Property at Borrower’s sole cost and expense; provided that, as
      long as no Default has occurred, Lender will not obtain at Borrower’s cost and
      expense, or request Borrower to obtain, an Appraisal more often than annually,
      unless required more frequently by any Governmental Authority.

    


    8.15           Storage
      of Materials

    .  Borrower
      shall cause all materials supplied for, or intended to be used in, the
      construction of the Improvements, but not affixed to or incorporated into the
      Improvements or the Subject Property, to be stored on the Subject Property
      or at
      such other location upon notice to Lender in writing prior to storage in such
      other location, with adequate safeguards, as commercially reasonable, to prevent
      loss, theft, damage, or commingling with other materials or
      projects.

    


    8.16           No
      Liability of Lender

    .  Lender
      shall have no liability, obligation, or responsibility whatsoever with respect
      to the construction of the Improvements except to make Loans under the Term
      Loan
      subject to the terms and provisions of this Agreement.  Lender shall
      not be obligated to inspect the Subject Property or the construction of the
      Improvements, nor be liable for the performance or default of Borrower, the
      general contractor, or any other party, or for any failure to construct,
      complete, protect, or insure the Improvements, or for the payment of costs
      of
      labor, materials, or services supplied for the construction of the Improvements,
      or for the performance of any obligation of Borrower
      whatsoever.  Nothing, including without limitation any Loan under the
      Term Loan or acceptance of any document or instrument, shall be construed as
      a
      representation or warranty, express or implied, to any party by
      Lender.

    


    8.17           No
      Conditional Sale Contracts, Etc

    .  No
      materials, equipment, or fixtures shall be supplied, purchased, or installed
      for
      the construction or operation of the Improvements pursuant to security
      agreements, conditional sale contracts, lease agreements, or other arrangements
      or understandings whereby a security interest or title is retained by any party
      or the right is reserved or accrues to any party to remove or repossess any
      materials, equipment, or fixtures intended to be used in the construction or
      operation of the Improvements, except in favor of Lender or as otherwise
      permitted pursuant to clause (c) of the definition of “Permitted Liens”
in this Agreement.

    


    
      
         

      

      
         

        
          

        

      

      
         

      

    

    8.18           Payment
      of Claims

    .  Borrower
      shall promptly pay or cause to be paid when due all costs and expenses incurred
      in connection with the Subject Property and the construction of the Improvements
      for the Subject Expansion, and Borrower shall keep the Subject Property free
      and
      clear of any Liens other than Liens approved in writing by
      Lender.  Notwithstanding anything to the contrary contained in this
      Agreement or the Loan Documents, Borrower (a) may contest the validity or amount
      of any claim of any contractor, consultant, or other person providing labor,
      materials, or services with respect to the Property, (b) may contest any tax
      or
      special assessments levied by any Governmental Authority, and (c) may contest
      the enforcement of or compliance with any Governmental Requirements, and such
      contest on the part of Borrower shall not be a Default hereunder and shall
      not
      release Lender from its obligations to make Loans under the Term Loan hereunder,
      provided that, during the pendency of any such contest, Borrower shall
      set aside adequate reserves being established in accordance with GAAP and shall
      pay any amount adjudged by a court of competent jurisdiction to be due, with
      all
      costs, interest, and penalties thereon, before such judgment becomes a lien
      on
      the Subject Property.

    


    8.19           Use
      of Loans Under Term Loan

    .  Borrower
      shall promptly disburse all Loans under the Term Loan for payment of costs
      and
      expenses incurred for the Subject Expansion, and as most recently requested
      on a
      Loan Request, and for no other purpose.”

    


    (q)  Section
      9.9 of the Credit Agreement is hereby deleted in its entirety and
      replaced  with Section 9.9 as
      follows:

     

    “9.9           Sale
      of Assets

    .  No
      Company may make any Disposition or enter into any agreement to make any
      Disposition, except (a) Dispositions of surplus, obsolete or worn out or no
      longer used assets in the ordinary course of business, (b) Dispositions of
      Inventory in the ordinary course of business, (c) the Disposition of
      delinquent accounts receivable in the ordinary course of business for purposes
      of collection, (d) Dispositions of property by any Company to another Company
      or
      to a wholly-owned Subsidiary; provided that, if the transferor of such
      property is the Borrower or a Guarantor, the transferee thereof must either
      be
      the Borrower or a Guarantor and must comply with Section
      6, (e) to the extent permitted by Section 9.6,
and (f) without duplication of clauses (a) through
(e) of this Section
      9.9, Dispositions of
      personal property assets up to $150,000 individually and up to $500,000 in
      the
      aggregate during the term of this Agreement.”

    


    (r)  Section
      10.3 of the Credit Agreement is hereby deleted and replaced with
      Section 10.3 as follows:

     

    “10.3                      “Maximum
      Unfinanced Capital Expenditures

    .  All
      Unfinanced Capital Expenditures for TOCCO may not exceed  $4,000,000
      in the aggregate in any calendar year, commencing with the calendar year ended
      December 31, 2007.”

    


    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (s)  New
      Sections 11.13 through 11.19
of the Credit Agreement
      are hereby added to the Credit Agreement
      in their appropriate numerical order as follows:

     

    “11.13                      Foreclosure
      of Other Liens

    .  The
      holder of any Lien on the Subject Property other than a Lender Lien (without
      implying Lender’s consent to the existence, placing, creating, or permitting of
      any lien or security interest) institutes foreclosure or other proceedings
      for
      the enforcement of its remedies thereunder and those proceedings are not stayed
      within ten (10) days after notice to Borrower.

    


    11.14                      Title

    .  Borrower’s
      title to any or all of the Subject Property  shall be challenged in
      writing or endangered by any Person whatsoever and the same (a) is not dismissed
      or cured within ten (10) days and (b) is considered by Lender in its sole
      reasonable discretion to present a material threat to the
      Collateral.

    


    11.15                      Project
      Requirements

    .  Borrower
      shall knowingly default or breach any Governmental Requirements pertaining
      to
      the Subject Expansion that results in a significant or material impairment
      of
      the value of the Subject Property.

    


    11.16                      Cease
      Construction

    .  Borrower
      ceases the construction of the Improvements for the Subject Expansion for more
      than thirty (30) days (for reasons other than Force Majeure) without
      Lender’s prior written consent, which shall not be unreasonably withheld or
      delayed.

    


    11.17                      Permits

    .  Borrower
      fails to (a) keep in full force and effect any required permit or approval
      from
      any appropriate Governmental Authority with respect to the construction of
      the
      Improvements and such failure continues for thirty (30) days after Borrower
      receives notice of, or has actual knowledge of, such failure, or (b) obtain
      a
      certificate of completion by the general contractor on or before fifteen (15)
      months after the date of the initial Loan under the Term Loan.

    


    11.18                      Survey
      Matters

    .  Any
      Survey required by Lender shows any matter not existing as of the date of the
      survey delivered on or prior to the initial Loan under the Term Loan which
      is
      unsatisfactory to Lender in its reasonable credit judgment, and such matter
      is
      not removed within a period of thirty (30) days after notice thereof by Lender
      to Borrower.

    


    11.19                      Contractor
      Default

    .  The
      general contractor or any subcontractor defaults under any Construction Contract
      in a manner which Lender deems to be material, and, unless otherwise agreed
      in
      writing by Lender, Borrower fails promptly to exercise its rights and remedies
      under such Construction Contract with respect to such default.”

    


    (t)  New
      Sections 12.6 through 12.7
      are hereby added to the Credit Agreement in their appropriate numerical order
      as
      follows:

     

    “12.6
      Complete Construction

    .  Upon
      the occurrence of a Default, Lender may, but shall not be obligated to: (a)
      perform all work necessary to complete the construction and equipping of the
      Improvements for the Subject Expansion in accordance with the Governmental
      Requirements; (b) do anything necessary or desirable in Lender’s sole judgment
      to fulfill the obligation of Borrower, including the right to avail itself
      of
      and procure performance of the Construction Contract and subcontractors or
      to
      let new or additional contracts with the contractor or the same subcontractors
      or to others; and (c) employ watchmen and other safeguards to protect the
      Subject Property and the Subject Expansion.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Without
      restricting the generality of the foregoing, Borrower hereby appoints Lender
      as
      the attorney-in-fact of Borrower, with full power of substitution, and in the
      name of Borrower, if Lender elects to do so, after the occurrence of a Default
      and in respect of the Term Loan, to (a) use such sums as are necessary,
      including any proceeds of the Term Loan, to make such changes or corrections
      in
      the plans and specifications for the Subject Expansion, and employ such
      engineers, inspectors, rental agents, managers and contractors as may be
      required for the purpose of completing the construction of the Improvements
      substantially in the manner contemplated by such plans and specifications and
      Governmental Requirements, (b) execute all applications and certificates in
      the
      name of Borrower which may be required for completion of construction of the
      Improvements for the Subject Expansion, (c) endorse the name of Borrower on
      any
      checks or drafts representing proceeds of the Insurance Policies, or other
      checks or installments payable to Borrower with respect to the Subject Property,
      (d) do every act with respect to the construction of the Improvements for the
      Subject Expansion which Borrower may do, (e) prosecute or defend any action
      or
      proceeding incident to the Subject Property, (f) to do all things necessary
      in
      Lender’s sole judgment, to complete construction, finishing and equipping of the
      Improvements for the Subject Expansion and to rent, operate and manage the
      Improvements, and to pay operating costs and expenses, including any applicable
      management fees, of every kind and nature in connection therewith so that the
      same shall be operational and usable for its intended purpose, all in the name
      of Borrower, Lender or both, (g) to pay interest when due on all amounts
      disbursed hereunder (either by adding such interest to the principal balance
      of
      the Term Loan or paying the same in cash), (h) to pay, settle or compromise
      all
      existing bills and claims which may be or become liens or security interests,
      or
      to avoid such bills and claims becoming liens against the Subject Property
      or
      against fixtures or equipment, or as may be necessary or desirable for the
      completion of construction or for the equipping and operation of the
      Improvements for the Subject Expansion, and (i) to prosecute and defend all
      actions or proceedings in connection with the Subject Property or any equipment
      or fixtures. Lender shall have no obligation to undertake any of the foregoing
      actions, and if Lender should do so, it shall have no liability to Borrower
      for
      the sufficiency or adequacy of any such actions taken by Lender.  All
      cost and expenses, including all reasonable attorneys’ fees (based on standard
      rates for hours actually worked by outside counsel) in connection with the
      matters contemplated in this Section 12.6 shall
      be payable by Borrower on demand, and if not promptly paid, shall be part of
      the
      Obligation and shall be secured by all of the Loan Documents.  The
      power-of-attorney granted hereby is a power coupled with an interest and
      irrevocable by action of Borrower without the joinder of
      Lender.  Lender shall have no obligation to undertake any of the
      foregoing actions, and if Lender should do so, it shall have no liability to
      Borrower for the sufficiency or adequacy of any such actions taken by
      Lender.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    12.7           Cessation
      of Loans under the Term Loan

    .  Upon
      the occurrence of a Default, the obligation of Lender to make any Loans under
      the Term Loan and all other obligations of Lender hereunder and under the Loan
      Documents shall at Lender’s option, immediately cease during any applicable cure
      period upon the failure of which Lender’s obligations to make Loans under the
      Term Loan shall, at Lender’s option, immediately terminate; provided
      that, nothing in this Section 12.7 shall be
      deemed to limit the other provisions of this Agreement setting forth the
      conditions precedent to Lender’s obligation to make any Loans under the Term
      Loan or the conditions under which Lender may refuse to make further
      disbursements or to limit Lender’s option to make further Loans under the Term
      Loan at Lender’s sole option notwithstanding the occurrence of one or more
      Defaults.”

     

    (u)  Section
      13.8 of the Credit Agreement is hereby deleted in its entirety and
      replaced with Section 13.8 as follows:

     

    “13.8                      Discharge
      Only Upon Payment in Full; Reinstatement in Certain
      Circumstances

     

    .  Each
      Company’s obligations under the Loan Documents remain in full force and effect
      until the commitment for the Revolving Credit Facility is terminated, the
      commitment for the Term Loan is terminated, and the Obligation is paid in full
      (except for provisions under the Loan Documents which by their terms expressly
      survive payment of the Obligation and termination of the Loan
      Documents).  If at any time any payment of the principal of or
      interest on any Note or any other amount payable by any Company or any other
      obligor on the Obligation under any Loan Document is rescinded or must be
      restored or returned upon the insolvency, bankruptcy or reorganization of
      Borrower or otherwise, the obligations of each Company under the Loan Documents
      with respect to that payment shall be reinstated as though the payment had
      been
      due but not made at that time.”

     

    (v)  Exhibit
      C to the Credit Agreement is hereby deleted in its entirety and
      replaced with Exhibit C attached to this
      Amendment.

     

    3.  First
      Amendment to Borrower Security Agreement.  The Borrower Security
      Agreement is hereby amended as follows:

     

    (a)  Section
      3 of the Borrower Security Agreement is hereby amended to add
      the
      following at the end of such Section 3:

     

    “Notwithstanding
      anything to the contrary herein or in any other Loan Document, the Collateral
      (as defined herein) shall not include the tolling product or other property
      as
      processed by Borrower for its customers located from time to time in Borrower’s
      tanks located on Borrower’s property as such tanks and tolling product or other
      property are more particularly described on attached Exhibit
“A” (as such Exhibit “A” may be replaced
      revised, updated, amended or otherwise modified from time to time with Secured
      Party’s consent, not to be unreasonably withheld or delayed).”

    


    (b)  Exhibit
      “A” attached to this Amendment is hereby added as
Exhibit “A” at the end of the Borrower Security
      Agreement.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    4.  Conditions.  This
      Amendment shall be effective once each of the following have been delivered
      to
      Lender in Proper Form:

     

    (a)  this
      Amendment executed by Borrower and Lender, together with Guarantors’ Consent and
      Agreement attached to this Amendment executed by such Guarantors;

     

    (b)  the
      Term
      Note  executed by Borrower;

     

    (c)  a
      Deed of
      Trust covering the Subject Property;

     

    (d)  an
      Assignment of Construction Contracts;

     

    (e)  a
      survey
      of the Subject Property;

     

    (f)  a
      final
      commitment for mortgagee’s title insurance on the foregoing Deed of Trust (with
      a mortgagee’s policy of title insurance to be delivered to Lender promptly after
      execution and delivery of this Amendment);

     

    (g)  an
      Appraisal of the Subject Property;

     

    (h)  an
      Officer’s Certificate of Borrower (with attachments thereto required by Lender);
      and

     

    (i)  such
      other documents and information as Lender may reasonably request.

     

    5.  Representations
      and Warranties.  Borrower represents and warrants to Lender that
      (a) it possesses all requisite power and authority to execute, deliver and
      comply with the terms of this Amendment, (b) this Amendment has been duly
      authorized and approved by all requisite corporate action on the part of
      Borrower, (c) no other consent of any Person (other than Lender) is required
      for
      this Amendment to be effective, (d) the execution and delivery of this Amendment
      does not violate its organizational documents, (e) the representations and
      warranties in each Loan Document to which it is a party are true and correct
      in
      all material respects on and as of the date of this Amendment as though made
      on
      the date of this Amendment after giving effect to this Amendment
      (except to the extent that such representations and warranties speak to
      a specific date), (f) it is in full compliance with all covenants and agreements
      contained in each Loan Document to which it is a party other than in
      respect of the Existing Default (before giving effect to this Amendment), and
      (g) after giving effect to this Amendment, to the best of Borrower’s knowledge
      after due inquiry and investigation, no Potential Default or Default has
      occurred and is continuing.  No investigation by Lender is required
      for Lender to rely on the representations and warranties in this
      Amendment.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    6.  Scope
      of Amendment; Reaffirmation; Release.  All references to the
      Credit Agreement shall refer to the Credit Agreement as affected by this
      Amendment.  Except as affected by this Amendment, the Loan Documents
      are unchanged and continue in full force and effect.  However, in the
      event of any inconsistency between the terms of the Credit Agreement (as
      affected by this Amendment) and any other Loan Document, the terms of the Credit
      Agreement (as affected by this Amendment) shall control and such other document
      shall be deemed to be amended to conform to the terms of the Credit Agreement
      (as amended by this Amendment).  Borrower hereby reaffirms its
      obligations under the Loan Documents to which it is a party and agrees that
      all
      Loan Documents to which it is a party remain in full force and effect and
      continue to be legal, valid, and binding obligations enforceable in accordance
      with their terms (as the same are affected by this Amendment).

     

                  
      7.  Miscellaneous.

        

    (a)  No
      Waiver of Defaults.  This Amendment does not constitute (i) a
      waiver of, or a consent to, (A) any provision of the Credit Agreement or any
      other Loan Document not expressly referred to in this Amendment, or (B) any
      present or future violation of, or default under, any provision of the Loan
      Documents other than the Existing Default, or (ii) a waiver of Lender’s right to
      insist upon future compliance with each term, covenant, condition and provision
      of the Loan Documents.

     

    (b)  Headings.  The
      headings and captions used in this Amendment are for convenience only and will
      not be deemed to limit, amplify or modify the terms of this Amendment, the
      Credit Agreement, or the other Loan Documents.

     

    (c)  Costs,
      Expenses and Attorneys’ Fees.  Borrower agrees to pay or reimburse
      Lender on demand for all its reasonable out-of-pocket costs and expenses
      incurred in connection with the preparation, negotiation, and execution of
      this
      Amendment, including, without limitation, the reasonable fees and disbursements
      of Lender’s counsel.

     

    (d)  Successors
      and Assigns.  This Amendment shall be binding upon and inure to
      the benefit of each of the undersigned and their respective successors and
      permitted assigns.

     

    (e)  Multiple
      Counterparts.  This Amendment may be executed in any number of
      counterparts with the same effect as if all signatories had signed the same
      document.  All counterparts must be construed together to constitute
      one and the same instrument.  This Amendment may be transmitted and
      signed by facsimile.  The effectiveness of any such documents and
      signatures shall, subject to applicable law, have the same force and effect
      as
      manually signed originals and shall be binding on Borrower and
      Lender.

     

    (f)  Governing
      Law.  This Amendment and the other Loan Documents must be
      construed, and their performance enforced, under Texas law.

     

    (g)  Arbitration.  Upon
      the demand of any party to this Amendment, any dispute shall be resolved by
      binding arbitration as provided for in Section 13.9 of
      the Credit Agreement.

     

    (h)  Entirety.  THE
      LOAN DOCUMENTS (AS AMENDED HEREBY) REPRESENT THE FINAL AGREEMENT BETWEEN
      BORROWER AND LENDER AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
      CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS BY THE PARTIES.  THERE
      ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.

     

    


    [Signatures
      appear on the following page.]


    
       

      
         

        
          

        

      

      
         

      

    


    This
      Amendment is executed as of the
      date set out in the preamble to this Amendment.

    


    BORROWER

     

     

    SOUTH
      HAMPTON RESOURCES, INC.

     

    By:
      /s/ N
      Carter                                                                      

    Name:Nick
      Carter

    Title:  President                                                      

     

    LENDER

     

    BANK
      OF AMERICA, N.A.

     

    By:
      /s/ Adam
      Rose                                                                      

    Name:
      Adam C.
      Rose                                                                      

    Title:
      Vice
      President                                                                      

    



    
      
              

                  Signature
            Page to Waiver and Second Amendment to Credit Agreement      
      

                  and
            First
            Amendment to Borrower Security Agreement      
    

         

      

      
         

        
          

        

      

      
         

      

    


    GUARANTORS’
      CONSENT AND AGREEMENT TO

    WAIVER
      AND SECOND AMENDMENT TO CREDIT AGREEMENT AND FIRST AMENDMENT TO BORROWER
      SECURITY AGREEMENT

    


    


    As
      an
      inducement to Lender to execute, and in consideration of Lender’s execution of,
      the Waiver and Second Amendment to Credit Agreement and First Amendment to
      Borrower Security Agreement (the “Amendment”), the
      undersigned hereby consent to the Amendment (including without limitation,
      the
      provision by Lender of the Term Loan to Borrower) and agree that the Amendment
      shall in no way release, diminish, impair, reduce or otherwise adversely affect
      the obligations and liabilities of the undersigned under the Guaranty executed
      by the undersigned in connection with the Credit Agreement, or under any Loan
      Documents, agreements, documents or instruments executed by the undersigned
      to
      create liens, security interests or charges to secure any of the Obligations
      (as
      defined in the Credit Agreement), all of which are in full force and effect.
      The
      undersigned hereby agree that the obligations and indebtedness guaranteed by
      the
      undersigned under the Guaranty, include without limitation, the obligations
      and
      indebtedness under the Term Loan. The undersigned further represent and warrant
      to Lender that (a) the representations and warranties in each Loan Document
      to
      which it is a party are true and correct in all material respects on and as
      of
      the date of this Amendment as though made on the date of this Amendment (except
      to the extent that such representations and warranties speak to a specific
      date), (b) they are in full compliance with all covenants and agreements
      contained in each Loan Document to which they are a party, and (c) no Default
      or
      Potential Default has occurred and is continuing.  Guarantors hereby
      release Lender from any liability for actions or omissions in connection with
      the Loan Documents prior to the date of this Amendment.  This
      Guarantors’ Consent and Agreement shall be binding upon the undersigned and
      their respective successors and assigns, and shall inure to the benefit of
      Lender and its successors and assigns.

     

    


     

          GUARANTOR:

     

    GULF
      STATE PIPE LINE
      COMPANY, INC.

    


    


    By:
/s/
      N
      Carter                                                                    

    Name:  Nick
      Carter                                                                    

     Title:  President                                                                      

    


    TEXAS
      OIL & CHEMICAL CO.
      II, INC.

    


    


    By:
      /s/ N
      Carter                                                                    

    Name:
Nick
      Carter                                                                    

    Title:
      President                                                                    

    



    
      
         

      

      
         

        
          

        

      

      
         

      

    


    EXHIBIT
      C (TO CREDIT AGREMENT)

    


    LOAN
      REQUEST

    


    ______________,
      20___

     

    Bank
      of
      America, N.A.

     

    700
      Louisiana, 7th
      Floor

     

    Houston,
      Texas 77002

     

    Attn:  Adam
      C. Rose

     

    Reference
      is made to the Credit Agreement dated as of May 25, 2006 (as amended,
      supplemented or restated from time to time, the “Credit
      Agreement”), between the undersigned and Bank of America, N.A., a
      national banking association
      (“Lender”).  Capitalized terms used but not
      defined in this Loan Request shall have the meanings given such terms in the
      Credit Agreement.  The undersigned hereby gives you notice pursuant to
Section 2.3 of the Credit Agreement that it
      requests a Loan under the Credit Agreement on the following terms:

     

    (A)           Loan
      Date (a Business
      Day)                                                                

     

    (B)           [Revolving
      Loan][Term
      Loan]                                                                

     

    (C)           Principal
      Amount of Loan*                                                                

     

    (D)           Type
      of Loan**                                                                

     

    (E)           For
      LIBOR Loans, Interest Period

     

    and
      the last day thereof***                                                                

     

    Borrower
      hereby certifies that the following statements are true and correct on the
      date
      this Loan Request, and will be true and correct on the Loan Date specified
      above
      after giving effect to such Loan:  (a) all of the representations and
      warranties in the Loan Documents are true and correct in all material respects
      (except to the extent that they speak to a specific date); (b) no Material
      Adverse Event has occurred; and (c) no Default or Potential Default
      exists.

     

    VERY
      TRULY YOURS,

    


    BORROWER:

    


    SOUTH
      HAMPTON RESOURCES,
      INC.

    


    


    BY:                                                                    

    NAME:                                                                    

    TITLE:                                                                    

    


    

      

    

     

      
        	
                   *

              	
                Not
                  less than $100,000 or a greater integral multiple of $10,000 (if
                  a Base
                  Rate Loan); not less than $100,000 or a greater integral multiple
                  of
                  $10,000 (if a LIBOR Loan)

              


      

    

     

        **      LIBOR
        Loan or Base Rate Loan

    

     

      
        	
                 ***

              	
                LIBOR
                  Loan — 1, 2, 3 or 6 months.  In no event may the Interest Period
                  end after the Revolving Credit Termination Date in respect of the
                  Revolving Credit Facility or the Term Loan Maturity Date in respect
                  of the
                  Term Loan.

              


      

      ****           Must
        be a Responsible Officer