Exhibit 10.30


 


Execution Copy


 




 


 





CREDIT AGREEMENT


 


Dated as of August
1, 2005


 


among


 


COPANO
ENERGY, L.L.C.,
as the Borrower,


 


BANK OF
AMERICA, N.A.,

as Administrative Agent and

L/C Issuer,


 


COMERICA
BANK and U.S. BANK NATIONAL
ASSOCIATION,


as Co-Syndication
Agents,


 


BANK OF
SCOTLAND and FORTIS CAPITAL CORP.,


as Co-Documentation
Agents,


 


and


 


The Other
Lenders Party Hereto


 


BANC OF
AMERICA SECURITIES LLC,
as

Sole Lead Arranger and Sole Book Manager


 


 




 
























 


TABLE OF CONTENTS


 


	
  Section

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS

  	
   

  
	
   

  	
  1.01

  	
  Defined
  Terms

  	
   

  
	
   

  	
  1.02

  	
  Other Interpretive Provisions

  	
   

  
	
   

  	
  1.03

  	
  Accounting
  Terms

  	
   

  
	
   

  	
  1.04

  	
  Rounding

  	
   

  
	
   

  	
  1.05

  	
  Times
  of Day

  	
   

  
	
   

  	
  1.06

  	
  Letter
  of Credit Amounts

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II. THE COMMITMENTS AND CREDIT
  EXTENSIONS

  	
   

  
	
   

  	
  2.01

  	
  Loans

  	
   

  
	
   

  	
  2.02

  	
  Borrowings,
  Conversions and Continuations of Loans

  	
   

  
	
   

  	
  2.03

  	
  Letters of Credit

  	
   

  
	
   

  	
  2.04

  	
  Reserved

  	
   

  
	
   

  	
  2.05

  	
  Prepayments

  	
   

  
	
   

  	
  2.06

  	
  Termination or Reduction
  of Commitments

  	
   

  
	
   

  	
  2.07

  	
  Repayment of Loans

  	
   

  
	
   

  	
  2.08

  	
  Interest

  	
   

  
	
   

  	
  2.09

  	
  Fees

  	
   

  
	
   

  	
  2.10

  	
  Computation of Interest and
  Fees

  	
   

  
	
   

  	
  2.11

  	
  Evidence of Debt

  	
   

  
	
   

  	
  2.12

  	
  Payments Generally;
  Administrative Agent’s Clawback

  	
   

  
	
   

  	
  2.13

  	
  Sharing of Payments by Lenders

  	
   

  
	
   

  	
  2.14

  	
  Increase in Commitments

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III. TAXES, YIELD PROTECTION AND
  ILLEGALITY

  	
   

  
	
   

  	
  3.01

  	
  Taxes

  	
   

  
	
   

  	
  3.02

  	
  Illegality

  	
   

  
	
   

  	
  3.03

  	
  Inability to Determine Rates

  	
   

  
	
   

  	
  3.04

  	
  Increased Costs; Reserves
  on Eurodollar Rate Loans

  	
   

  
	
   

  	
  3.05

  	
  Compensation for Losses

  	
   

  
	
   

  	
  3.06

  	
  Mitigation
  Obligations; Replacement of Lenders

  	
   

  
	
   

  	
  3.07

  	
  Survival

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

  	
   

  
	
   

  	
  4.01

  	
  Conditions of Initial Credit
  Extension

  	
   

  
	
   

  	
  4.02

  	
  Conditions to all Credit
  Extensions

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V. REPRESENTATIONS AND WARRANTIES

  	
   

  
	
   

  	
  5.01

  	
  Existence, Qualification and
  Power; Compliance with Laws

  	
   

  
	
   

  	
  5.02

  	
  Authorization; No Contravention

  	
   

  
	
   

  	
  5.03

  	
  Governmental Authorization;
  Other Consents

  	
   

  
	
   

  	
  5.04

  	
  Binding Effect

  	
   

  
	
   

  	
  5.05

  	
  Financial
  Statements; No Material Adverse Effect; No Internal Control Event

  	
   

  
	
   

  	
  5.06

  	
  Litigation

  	
   

  
	
   

  	
  5.07

  	
  No Default

  	
   

  
					



 





















 


	
   

  	
  5.08

  	
  Ownership of Property; Liens

  	
   

  
	
   

  	
  5.09

  	
  Environmental Compliance

  	
   

  
	
   

  	
  5.10

  	
  Insurance

  	
   

  
	
   

  	
  5.11

  	
  Taxes

  	
   

  
	
   

  	
  5.12

  	
  ERISA Compliance

  	
   

  
	
   

  	
  5.13

  	
  Subsidiaries; Equity
  Interests

  	
   

  
	
   

  	
  5.14

  	
  Margin Regulations;
  Investment Company Act; Public Utility Holding Company Act

  	
   

  
	
   

  	
  5.15

  	
  Disclosure

  	
   

  
	
   

  	
  5.16

  	
  Compliance with Laws

  	
   

  
	
   

  	
  5.17

  	
  Intellectual Property;
  Licenses, Etc

  	
   

  
	
   

  	
  5.18

  	
  Labor Disputes and Acts of
  God

  	
   

  
	
   

  	
  5.19

  	
  Solvency

  	
   

  
	
   

  	
  5.20

  	
  Acquisition Closing

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI. AFFIRMATIVE COVENANTS

  	
   

  
	
   

  	
  6.01

  	
  Financial Statements

  	
   

  
	
   

  	
  6.02

  	
  Certificates; Other
  Information

  	
   

  
	
   

  	
  6.03

  	
  Notices

  	
   

  
	
   

  	
  6.04

  	
  Payment of Obligations

  	
   

  
	
   

  	
  6.05

  	
  Preservation of Existence,
  Etc

  	
   

  
	
   

  	
  6.06

  	
  Maintenance of Properties

  	
   

  
	
   

  	
  6.07

  	
  Maintenance of Insurance

  	
   

  
	
   

  	
  6.08

  	
  Compliance with Laws

  	
   

  
	
   

  	
  6.09

  	
  Books and Records

  	
   

  
	
   

  	
  6.10

  	
  Inspection Rights

  	
   

  
	
   

  	
  6.11

  	
  Use of Proceeds

  	
   

  
	
   

  	
  6.12

  	
  Additional Guarantors

  	
   

  
	
   

  	
  6.13

  	
  Agreement to Deliver
  Security Documents

  	
   

  
	
   

  	
  6.14

  	
  Perfection and Protection
  of Security Interests and Liens

  	
   

  
	
   

  	
  6.15

  	
  Performance on Loan Parties’
  Behalf

  	
   

  
	
   

  	
  6.16

  	
  Environmental Matters;
  Environmental Reviews

  	
   

  
	
   

  	
  6.17

  	
  Compliance with Agreements

  	
   

  
	
   

  	
  6.18

  	
  Unrestricted Subsidiaries

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII. NEGATIVE COVENANTS

  	
   

  
	
   

  	
  7.01

  	
  Liens

  	
   

  
	
   

  	
  7.02

  	
  Investments

  	
   

  
	
   

  	
  7.03

  	
  Indebtedness

  	
   

  
	
   

  	
  7.04

  	
  Fundamental Changes

  	
   

  
	
   

  	
  7.05

  	
  Dispositions

  	
   

  
	
   

  	
  7.06

  	
  Restricted Payments

  	
   

  
	
   

  	
  7.07

  	
  Change in Nature of Business

  	
   

  
	
   

  	
  7.08

  	
  Transactions with
  Affiliates

  	
   

  
	
   

  	
  7.09

  	
  Burdensome Agreements

  	
   

  
	
   

  	
  7.10

  	
  Use of Proceeds

  	
   

  
	
   

  	
  7.11

  	
  Prohibited Contracts

  	
   

  
	
   

  	
  7.12

  	
  Hedging Contracts

  	
   

  
	
   

  	
  7.13

  	
  Subsidiaries

  	
   

  
	
   

  	
  7.14

  	
  Limitation on Credit
  Extensions

  	
   

  
	
   

  	
  7.15

  	
  Risk Management Compliance

  	
   

  
	
   

  	
  7.16

  	
  Subordinated Debt

  	
   

  



 


ii





















 


	
   

  	
  7.17

  	
  Material Contracts

  	
   

  
	
   

  	
  7.18

  	
  Designation and Conversion
  of Restricted and Unrestricted Subsidiaries; Debt of Unrestricted
  Subsidiaries

  	
   

  
	
   

  	
  7.19

  	
  Capital Expenditures

  	
   

  
	
   

  	
  7.20

  	
  Amendments to Organizational
  Documents

  	
   

  
	
   

  	
  7.21

  	
  Financial Covenants

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII. EVENTS OF DEFAULT AND
  REMEDIES

  	
   

  
	
   

  	
  8.01

  	
  Events of Default

  	
   

  
	
   

  	
  8.02

  	
  Remedies Upon Event of
  Default

  	
   

  
	
   

  	
  8.03

  	
  Application of Funds

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX. ADMINISTRATIVE AGENT

  	
   

  
	
   

  	
  9.01

  	
  Appointment and Authority

  	
   

  
	
   

  	
  9.02

  	
  Rights as a Lender

  	
   

  
	
   

  	
  9.03

  	
  Exculpatory Provisions

  	
   

  
	
   

  	
  9.04

  	
  Reliance by Administrative
  Agent

  	
   

  
	
   

  	
  9.05

  	
  Delegation of Duties

  	
   

  
	
   

  	
  9.06

  	
  Resignation of
  Administrative Agent

  	
   

  
	
   

  	
  9.07

  	
  Non-Reliance on
  Administrative Agent and Other Lenders

  	
   

  
	
   

  	
  9.08

  	
  No Other Duties, Etc

  	
   

  
	
   

  	
  9.09

  	
  Administrative Agent May
  File Proofs of Claim

  	
   

  
	
   

  	
  9.10

  	
  Collateral and Guaranty
  Matters

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X. MISCELLANEOUS

  	
   

  
	
   

  	
  10.01

  	
  Amendments, Etc

  	
   

  
	
   

  	
  10.02

  	
  Notices; Effectiveness;
  Electronic Communication

  	
   

  
	
   

  	
  10.03

  	
  No Waiver; Cumulative Remedies

  	
   

  
	
   

  	
  10.04

  	
  Expenses; Indemnity; Damage
  Waiver

  	
   

  
	
   

  	
  10.05

  	
  Payments Set Aside

  	
   

  
	
   

  	
  10.06

  	
  Successors and Assigns

  	
   

  
	
   

  	
  10.07

  	
  Treatment of Certain
  Information; Confidentiality

  	
   

  
	
   

  	
  10.08

  	
  Right of Setoff

  	
   

  
	
   

  	
  10.09

  	
  Interest Rate Limitation

  	
   

  
	
   

  	
  10.10

  	
  Counterparts; Integration;
  Effectiveness

  	
   

  
	
   

  	
  10.11

  	
  Survival of Representations
  and Warranties

  	
   

  
	
   

  	
  10.12

  	
  Severability

  	
   

  
	
   

  	
  10.13

  	
  Replacement of Lenders

  	
   

  
	
   

  	
  10.14

  	
  Governing Law; Jurisdiction;
  Etc

  	
   

  
	
   

  	
  10.15

  	
  Waiver of Jury Trial

  	
   

  
	
   

  	
  10.16

  	
  USA PATRIOT Act Notice

  	
   

  
	
   

  	
  10.17

  	
  Amendment and Restatement

  	
   

  
	
   

  	
  10.18

  	
  ENTIRE AGREEMENT

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNATURES

  	
   

  



 


iii





















 


	
  SCHEDULES

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  1.01

  	
  Security Schedule

  	
   

  
	
   

  	
  2.01

  	
  Commitments and Applicable
  Percentages

  	
   

  
	
   

  	
  5.05

  	
  Supplement to Interim Financial
  Statements

  	
   

  
	
   

  	
  5.09

  	
  Environmental Matters

  	
   

  
	
   

  	
  5.13

  	
  Subsidiaries; Other Equity
  Investments

  	
   

  
	
   

  	
  7.01

  	
  Existing Liens

  	
   

  
	
   

  	
  7.03

  	
  Existing Indebtedness

  	
   

  
	
   

  	
  7.11

  	
  Prohibited Contracts

  	
   

  
	
   

  	
  10.02

  	
  Administrative Agent’s Office;
  Certain Addresses for Notices

  	
   

  
	
   

  	
  10.06

  	
  Processing and Recordation Fees

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  EXHIBITS

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  A

  	
  Loan Notice

  	
   

  
	
   

  	
  B

  	
  Reserved

  	
   

  
	
   

  	
  C

  	
  Note

  	
   

  
	
   

  	
  D

  	
  Compliance Certificate

  	
   

  
	
   

  	
  E

  	
  Assignment and Assumption

  	
   

  
	
   

  	
  F

  	
  Guaranty

  	
   

  
	
   

  	
  G

  	
  Pledge and Security Agreement

  	
   

  
	
   

  	
  H

  	
  Opinion Matters

  	
   

  
	
   

  	
  I

  	
  Solvency Certificate

  	
   

  
	
   

  	
  J

  	
  Collateral Sharing Agreement

  	
   

  
	
   

  	
  K

  	
  Risk Management Policy

  	
   

  



 


iv





















 


CREDIT AGREEMENT


 


This CREDIT AGREEMENT (“Agreement”) is
entered into as of August 1, 2005, among COPANO
ENERGY, L.L.C., a Delaware limited liability company (the “Borrower”),
each lender from time to time party hereto (collectively, the “Lenders”
and individually, a “Lender”), and BANK OF AMERICA, N.A., as Administrative Agent and L/C Issuer.


 


The Borrower has requested that the Lenders
provide a revolving credit facility, and the Lenders are willing to do so on
the terms and conditions set forth herein.


 


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


 


ARTICLE I.

DEFINITIONS AND ACCOUNTING TERMS


 


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


 


“Acquisition” means the purchase by
the Acquisition Subsidiary of all the Equity Interests of ScissorTail pursuant
to the Acquisition Agreement.


 


“Acquisition Agreement” means that
certain Membership Interest Purchase Agreement dated as of June 20, 2005, by
and among the Borrower, the Acquisition Subsidiary, ScissorTail, Hamilton
ScissorTail, LLC, ScissorTail Holdings, LLC, Jay A. Precourt and Frederic C.
Hamilton.


 


“Acquisition Documents” means (a) the
Acquisition Agreement, and (b) all other agreements, assignments, deeds,
conveyances, certificates and other documents and instruments now or hereafter
executed and delivered in connection with the Acquisition.


 


“Acquisition Subsidiary” means Copano
Energy/Rocky Mountains and Mid-Continent, L.L.C., a Delaware limited liability
company, a wholly-owned Subsidiary of the Borrower.


 


“Additional Debt” means Indebtedness
for borrowed money other than Indebtedness described in Section 7.03 hereof.


 


“Additional Equity” means any
contribution to the equity capital of any Person whether or not occurring in
connection with the issuance or sale of Equity Interests by such Person.


 


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


 


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


 





















 


“Administrative Questionnaire” means
an Administrative Questionnaire in a form supplied by the Administrative Agent.


 


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


 


“Aggregate Commitments” means the
Commitments of all the Lenders.


 


“Agreement” means this Credit
Agreement.


 


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


 


“Applicable Rate” means the following
percentages per annum, based upon the Consolidated Senior Leverage Ratio as set
forth in the most recent Compliance Certificate received by the Administrative
Agent pursuant to Section 6.02(b):


 


Applicable Rate


 




	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Eurodollar 

  Rate + 

  	
   

  	
   

  	
   

  
	
  Pricing Level

  	
   

  	
  Consolidated Senior 

  Leverage Ratio

  	
   

  	
  Commitment

  Fee

  	
   

  	
  Letters of 

  Credit

  	
   

  	
  Base Rate 

  +

  	
   

  
	
  1

  	
   

  	
  >3.50:1

  	
   

  	
  0.375

  	
  %

  	
  2.75

  	
  %

  	
  1.25

  	
  %

  
	
  2

  	
   

  	
  >3.00:1 but < 3.50:1

  	
   

  	
  0.375

  	
  %

  	
  2.50

  	
  %

  	
  1.00

  	
  %

  
	
  3

  	
   

  	
  >2.50:1 but < 3.00:1

  	
   

  	
  0.300

  	
  %

  	
  2.25

  	
  %

  	
  0.75

  	
  %

  
	
  4

  	
   

  	
  <2.50:1

  	
   

  	
  0.250

  	
  %

  	
  1.75

  	
  %

  	
  0.25

  	
  %

  






 


Any increase or decrease in the Applicable
Rate resulting from a change in the Consolidated Senior Leverage Ratio shall
become effective as of the first Business Day immediately following the date a
Compliance Certificate is delivered pursuant to Section 6.02(b); provided,
however, that if a Compliance Certificate is not delivered when due in
accordance with such Section, then Pricing Level 1 shall apply as of the
first Business Day after the date on which such Compliance Certificate was
required to have been delivered.  The
Applicable Rate in effect from the Closing Date through the date following September
30, 2005 on which a Compliance Certificate is delivered or to be delivered
pursuant to Section 6.02(b) shall be determined based upon Pricing Level
3.


 


2





















 


“Approved Counterparty” means (a) any
Person whose long term senior unsecured debt rating is A- by S&P or higher
or A3 by Moody’s or higher (or any Person whose obligations under a Hedging
Contract are unconditionally guaranteed by an Affiliate with such debt rating)
or (b) any other Person from time to time approved by the Administrative Agent,
in each case who has executed and delivered a Collateral Sharing Agreement.


 


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


 


“Arranger” means Banc of America Securities LLC, in its capacity as
sole lead arranger and sole book manager.


 


“Assignee Group” means two or more
Eligible Assignees that are Affiliates of one another or two or more Approved
Funds managed by the same investment advisor.


 


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


 


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


 


“Audited Financial Statements” means
the audited consolidated balance sheet of the Borrower and its Subsidiaries for
the fiscal year ended December 31, 2004, and
the related consolidated statements of income or operations, members’ capital
and cash flows for such fiscal year of the Borrower and its Subsidiaries,
including the notes thereto.


 


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


 


“Available Cash” for any fiscal
quarter has the meaning set forth in the Borrower LLC Agreement.


 


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


 


“Base Rate”  means for any day a fluctuating
rate per annum equal to the higher of (a) the Federal Funds Rate plus 1/2
of 1% and (b) the rate of interest in effect for such day as publicly
announced from time to time by Bank of America as its “prime rate”.  The “prime rate” is a rate set by Bank of
America based upon various factors including Bank of America’s costs and 


 


3





















 


desired return, general economic conditions
and other factors, and is used as a reference point for pricing some loans,
which may be priced at, above, or below such announced rate.  Any change in such rate announced by Bank of
America shall take effect at the opening of business on the day specified in
the public announcement of such change.


 


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


 


“BBA LIBOR” has the
meaning specified in Section 1.01 under the definition of “Eurodollar Rate”.


 


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


 


“Borrower LLC Agreement” means the
Second Amended and Restated Limited Liability Company Agreement of the Borrower
dated as of November 15, 2004.


 


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


 


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


 


“Business Day” means any day other
than a Saturday, Sunday or other day on which commercial banks are authorized
to close under the Laws of, or are in fact closed in, the state where the
Administrative Agent’s Office is located and, if such day relates to any
Eurodollar Rate Loan, means any such day on which dealings in Dollar deposits
are conducted by and between banks in the London interbank eurodollar market.


 


“Capital Expenditures” means, for any
period, for the Borrower and its Restricted Subsidiaries on a consolidated
basis, an amount equal to the sum of (i) the aggregate amount of all
expenditures of the Borrower and its Restricted Subsidiaries for fixed or capital
assets made during such period which, in accordance with GAAP, would be
classified as capital expenditures plus (ii) the aggregate amount of all capitalized
lease liabilities incurred during such period.


 


“Cash Collateralize” has the meaning
specified in Section 2.03(g).


 


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


 


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


 


(a)                                 any
“person” or “group” (as such terms are used in Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934, but excluding any employee benefit plan of
such person or its subsidiaries, and any person or entity acting in its
capacity as trustee, agent or other fiduciary or administrator of any such
plan) becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under
the Securities Exchange Act of 


 


4





















 


1934), except that a person or group shall be
deemed to have “beneficial ownership” of all securities that such person or
group has the right to acquire (such right, an “option right”), whether
such right is exercisable immediately or only after the passage of time),
directly or indirectly, of 30% or more of the equity securities of the Borrower
entitled to vote for members of the board of directors or equivalent governing
body of the Borrower on a fully-diluted basis (and taking into account all such
securities that such person or group has the right to acquire pursuant to any
option right);


 


(b)                                 during
any period of 12 consecutive months, a majority of the members of the board of
directors or other equivalent governing body of the Borrower cease to be composed
of individuals (i) who were members of that board or equivalent governing body
on the first day of such period, (ii) whose election or nomination to that
board or equivalent governing body was approved by individuals referred to in
clause (i) above constituting at the time of such election or nomination
at least a majority of that board or equivalent governing body or (iii) whose
election or nomination to that board or other equivalent governing body was
approved by individuals referred to in clauses (i) and (ii) above
constituting at the time of such election or nomination at least a majority of
that board or equivalent governing body (excluding, in the case of both clause
(ii) and clause (iii), any individual whose initial nomination for, or
assumption of office as, a member of that board or equivalent governing body
occurs as a result of an actual or threatened solicitation of proxies or
consents for the election or removal of one or more directors by any person or
group other than a solicitation for the election of one or more directors by or
on behalf of the board of directors); or


 


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


 


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


 


“Code” means the Internal Revenue Code
of 1986.


 


“Collateral” means all property of any
kind which is subject to a Lien in favor of Lenders (or in favor of
Administrative Agent for the benefit of Lenders and Lender Counterparties) or
which, under the terms of any Security Document, is purported to be subject to
such a Lien, in each case granted or created to secure all or part of the
Obligations.


 


“Collateral Sharing Agreement” means a
Collateral Sharing Agreement by and among an Approved Counterparty, the
Administrative Agent, and the Borrower or a Guarantor (as applicable),
substantially in the form of Exhibit J.


 


5





















 


“Comerica Credit Facility” means that
certain Credit Agreement among Copano Houston Central, L.L.C., Copano
Processing, L.P., Copano NGL Services, L.P. and Comerica Bank dated as of
November 15, 2004, as the same has been amended prior to the date hereof.


 


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


 


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


 


“Consolidated EBITDA” means, for any
period, for the Borrower and its Restricted Subsidiaries on a consolidated
basis, an amount equal to Consolidated Net Income for such period plus
(a) the following to the extent deducted in calculating such Consolidated Net
Income: (i) Consolidated Interest Charges for such period, (ii) the provision
for Federal, state, local and foreign income taxes payable by the Borrower and
its Restricted Subsidiaries for such period, (iii) depreciation and
amortization expense, and (iv) other expenses of the Borrower and its Restricted
Subsidiaries reducing such Consolidated Net Income which do not represent a
cash item in such period or any future period and minus (b) the
following to the extent included in calculating such Consolidated Net Income:  (i) Federal, state, local and foreign income
tax credits of the Borrower and its Restricted Subsidiaries for such period and
(ii) all non-cash items increasing Consolidated Net Income for such period; provided
that for the purposes of Section 7.21, if the Borrower or any Restricted
Subsidiary shall acquire or dispose of any material property or a Subsidiary
shall be redesignated as either an Unrestricted Subsidiary or a Restricted
Subsidiary, in any case, during the period of four fiscal quarters ending on
the last day of the fiscal quarter immediately preceding the date of determination
for which financial statements are available and up to and including the date
of the consummation of such acquisition, disposition or redesignation, then
Consolidated EBITDA shall be calculated, in a manner satisfactory to the
Administrative Agent in its reasonable discretion, after giving pro forma
effect to such acquisition (including the revenues of the properties acquired),
merger, disposition or redesignation, as if such acquisition, merger,
disposition or redesignation had occurred on the first day of such period.


 


“Consolidated Fixed Charge Coverage Ratio”
means, as of any date of determination, the ratio of (a) Consolidated EBITDA
minus Maintenance Capital Expenditures for the applicable period to (b) Consolidated
Fixed Charges for the applicable period.


 


“Consolidated Fixed Charges” means, for
any period, for the Borrower and its Restricted Subsidiaries on a consolidated
basis, an amount equal to the sum (without duplication) of the following (in
each case, eliminating all offsetting debits and credits between the Borrower
and its Restricted Subsidiaries and all other items required to be eliminated
in the course of the preparation of consolidated financial statements of the Borrower
and its Restricted Subsidiaries in accordance with GAAP):  (a) Consolidated Interest Charges; plus
(b) all fees, expenses and charges in respect of letters of credit issued
for the account of the Borrower or any of its Restricted Subsidiaries, which
are accrued during such period and whether expensed in such 


 


6





















 


period or capitalized; plus (c) payments
of principal in respect of Indebtedness of the Borrower or its Restricted
Subsidiaries (including the principal component of payments under capital leases)
paid or payable in such period (other than payments of principal of Loans which
are available to be reborrowed hereunder).


 


“Consolidated Funded Indebtedness”
means, as of any date of determination, for the Borrower and its Restricted
Subsidiaries on a consolidated basis, the sum of (a) the outstanding principal
amount of all obligations, whether current or long-term, for borrowed money
(including Obligations hereunder) and all obligations evidenced by bonds,
debentures, notes, loan agreements or other similar instruments, (b) all
purchase money Indebtedness, (c) all direct obligations arising under letters
of credit (including standby and commercial), bankers’ acceptances, bank
guaranties, surety bonds and similar instruments, (d) all obligations in
respect of the deferred purchase price of property or services (other than
trade accounts payable in the ordinary course of business), (e) Attributable
Indebtedness in respect of capital leases and Synthetic Lease Obligations, (f)
without duplication, all Guarantees with respect to outstanding Indebtedness of
the types specified in clauses (a) through (e) above of Persons other than the
Borrower or any Restricted Subsidiary, and (g) all Indebtedness of the types
referred to in clauses (a) through (f) above of any partnership or joint
venture (other than a joint venture that is itself a corporation or limited
liability company) in which the Borrower or a Restricted Subsidiary is a
general partner or joint venturer, unless such Indebtedness is expressly made
non-recourse to the Borrower or such Restricted Subsidiary.


 


“Consolidated Interest Charges” means,
for any period, for the Borrower and its Restricted Subsidiaries on a
consolidated basis, the sum of (a) all interest, premium payments, debt
discount, fees, charges and related expenses of the Borrower and its Restricted
Subsidiaries in connection with borrowed money (including capitalized interest)
or in connection with the deferred purchase price of assets, in each case to
the extent treated as interest in accordance with GAAP, excluding (i)
distributions and payments to the Borrower’s preferred unitholders and
warrantholders prior to November 15, 2004 and (ii) one-time charges in respect
of loan origination or similar fees and non-cash amortized amounts with respect
thereto, and (b) the portion of rent expense of the Borrower and its Restricted
Subsidiaries with respect to such period under capital leases that is treated
as interest in accordance with GAAP.


 


“Consolidated Interest Coverage Ratio”
means, as of any date of determination, the ratio of (a) Consolidated EBITDA to (b) Consolidated Interest Charges for the applicable period.


 


“Consolidated Net Income” means, for
any period, for the Borrower and its Restricted Subsidiaries’ gross revenues
for such period, including any cash dividends or distributions actually
received from any other Person during such period, minus the Borrower’s and its
Restricted Subsidiaries’ expenses and other proper charges against income
(including taxes on income to the extent imposed), determined on a consolidated
basis in accordance with GAAP consistently applied after eliminating earnings
or losses attributable to outstanding minority interests and excluding the net
earnings of any Person other than a Restricted Subsidiary in which the Borrower
or any of its Subsidiaries has an ownership interest.  Consolidated Net Income shall not include (i)
any gain or loss from the Disposition of assets, (ii) any extraordinary gains
or losses or (iii) any non-cash gains or losses resulting from mark to market
activity as a 


 


7





















 


result of the implementation of Statement of
Financial Accounting Standards 133, “Accounting for Derivative Instruments and
Hedging Activities” (“SFAS 133”).


 


“Consolidated Senior Funded Indebtedness”
means, as of any date of determination, Consolidated Funded Indebtedness, but
excluding Indebtedness under the Senior Bridge Facility (or any refinancing or
replacement thereof permitted pursuant to Section 7.03(b)) and Subordinated Debt.


 


“Consolidated Senior Leverage Ratio”
means, as of any date of determination, the ratio of (a) Consolidated Senior
Funded Indebtedness as of such date to (b) Consolidated EBITDA for the applicable
period ending on such date.


 


“Consolidated Total Leverage Ratio”
means, as of any date of determination, the ratio of (a) Consolidated Funded
Indebtedness as of such date to (b) Consolidated EBITDA for the applicable period
ending on such date.


 


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


 


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


 


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


 


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


 


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


 


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


 


“Defaulting Lender” means any Lender
that (a) has failed to fund any portion of the Loans or participations in L/C
Obligations required to be funded by it hereunder within one Business Day of
the date required to be funded by it hereunder, (b) has otherwise failed to pay



 


8





















 


over to the Administrative Agent or any other
Lender any other amount required to be paid by it hereunder within one Business
Day of the date when due, unless the subject of a good faith dispute, or (c)
has been deemed insolvent or become the subject of a receivership, bankruptcy
or insolvency proceeding.


 


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


 


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


 


“Eligible Assignee” means (a) a
Lender; (b) an Affiliate of a Lender; (c) an Approved Fund; and
(d) any other Person (other than a natural person) approved by (i) the
Administrative Agent and the L/C Issuer, and (ii) unless an Event of
Default has occurred and is continuing, the Borrower (each such approval not to
be unreasonably withheld or delayed); provided that notwithstanding the
foregoing, “Eligible Assignee” shall not include the Borrower or any of the
Borrower’s Affiliates or Subsidiaries.


 


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


 


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


 


“Equity Interests” means, with respect
to any Person, all of the shares of capital stock of (or other ownership or
profit interests in) such Person, all of the warrants, options or other rights
for the purchase or acquisition from such Person of shares of capital stock of
(or other ownership or profit interests in) such Person, all of the securities
convertible into or exchangeable for shares of capital stock of (or other
ownership or profit interests in) such Person or warrants, rights or options
for the purchase or acquisition from such Person of such shares (or such other
interests), and all of the other ownership or profit interests in such Person
(including partnership, member or trust interests therein), whether voting or
nonvoting, and whether or not such shares, warrants, options, rights or other
interests are outstanding on any date of determination.


 


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


 


9





















 


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


 


“ERISA Event” means (a) a Reportable
Event with respect to a Pension Plan; (b) a withdrawal by the Borrower or any
ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a
plan year in which it was a substantial employer (as defined in
Section 4001(a)(2) of ERISA) or a cessation of operations that is treated
as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial
withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer Plan or
notification that a Multiemployer Plan is in reorganization; (d) the filing of
a notice of intent to terminate, the treatment of a Plan amendment as a
termination under Sections 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e)
an event or condition which constitutes grounds under Section 4042 of ERISA for
the termination of, or the appointment of a trustee to administer, any Pension
Plan or Multiemployer Plan; or (f) the imposition of any liability under Title
IV of ERISA, other than for PBGC premiums due but not delinquent under Section
4007 of ERISA, upon the Borrower or any ERISA Affiliate.


 


“Eurodollar Rate” means for any
Interest Period with respect to a Eurodollar Rate Loan, the rate per annum
equal to the British Bankers Association LIBOR Rate (“BBA LIBOR”), as
published by Reuters (or other commercially available source providing
quotations of BBA LIBOR as designated by the Administrative Agent from time to
time) at approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, for Dollar deposits (for delivery on the
first day of such Interest Period) with a term equivalent to such Interest
Period.  If such rate is not available at
such time for any reason, then the “Eurodollar Rate” for such Interest Period
shall be the rate per annum determined by the Administrative Agent to be the
rate at which deposits in Dollars for delivery on the first day of such
Interest Period in same day funds in the approximate amount of the Eurodollar
Rate Loan being made, continued or converted by Bank of America and with a term
equivalent to such Interest Period would be offered by Bank of America’s London
Branch to major banks in the London interbank Eurodollar market at their
request at approximately 11:00 a.m. (London time) two Business Days prior to
the commencement of such Interest Period.


 


“Eurodollar Rate Loan” means a Loan
that bears interest at a rate based on the Eurodollar Rate.


 


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


 


“Excess Sale Proceeds” has the meaning
specified in Section 7.05(c).


 


“Excluded Taxes” means, with respect
to the Administrative Agent, any Lender, the L/C Issuer or any other recipient
of any payment to be made by or on account of any obligation of the Borrower or
any other Loan Party hereunder or under any other Loan Document, (a) taxes
imposed on or measured by its net income (however denominated), and franchise
taxes imposed on it, by the United States or by the jurisdiction (or any
political subdivision thereof) under the laws of which such recipient is
organized or resident or in which its principal office is located or 


 


10





















 


in which it is doing or has done business or,
in the case of any Lender, in which its applicable Lending Office is located or
in which it is doing or has done business, (b) any branch profits taxes imposed
by the United States or any similar tax imposed by any other jurisdiction (or any
political subdivision thereof) in which the Borrower is located and (c) in the
case of a Foreign Lender (other than an assignee pursuant to a request by the
Borrower under Section 10.13), any withholding tax that is imposed
on amounts payable to such Foreign Lender at the time such Foreign Lender
becomes a party hereto (or designates a new Lending Office) or is attributable
to such Foreign Lender’s failure to comply with Section 3.01(h) or its failure
or inability (other than as a result of a Change in Law) to comply with Section 3.01(e),
except to the extent that such Foreign Lender (or its assignor, if any) was
entitled, at the time of designation of a new Lending Office (or assignment),
to receive additional amounts from the Borrower with respect to such
withholding tax pursuant to Section 3.01(a).


 


“Existing Credit Agreement” means that
certain Amended and Restated Credit Agreement dated as of February 13,
2004, among Copano Pipelines Group, L.L.C., Copano Field Services/Copano Bay,
L.P., Copano Field Services/Agua Dulce, L.P., Copano Field Services/South
Texas, L.P., Copano Field Services/Live Oak, L.P., Copano Field
Services/Central Gulf Coast, L.P., Copano Field Services/Upper Gulf Coast, L.P.,
                Copano
Pipelines/South Texas, L.P., Copano Pipelines/Upper Gulf Coast, L.P., Copano
Pipelines/Hebbronville, L.P., Copano Energy Services/Upper Gulf Coast, L.P.,
Bank of America, N.A. (successor by merger to Fleet National Bank), as agent,
and a syndicate of lenders, as amended or supplemented to the Closing Date.


 


“Existing Letters of Credit” means all
Letters of Credit existing on the Closing Date issued under the Existing Credit
Agreement or under the ScissorTail Credit Facility.


 


“Extraordinary Receipts” means gross
proceeds received by any Loan Party relating to (a) insurance in respect of
casualty to property that such Loan Party has determined (which determination
must be made with reasonable promptness following such casualty) will not be
applied to the repair or replacement thereof within 180 days following such
casualty in accordance with the Security Documents,  or (b) payments pursuant to any indemnity
agreement that such Loan Party has determined (which determination must be made
with reasonable promptness following receipt of such payment) will not be
applied to remedy the circumstances or improve, repair or replace the property
of such Loan Party pursuant to which such indemnity payment arose within 180
days following such payment, or (c) pension reversions; provided  that
in no event shall such Extraordinary Receipts include Net Cash Proceeds.


 


“Federal Funds Rate”  means, for any day, the rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published by the Federal Reserve Bank of New York
on the Business Day next succeeding such day; provided that (a) if such
day is not a Business Day, the Federal Funds Rate for such day shall be such
rate on such transactions on the next preceding Business Day as so published on
the next succeeding Business Day, and (b) if no such rate is so published on
such next succeeding Business Day, the Federal Funds Rate for such day shall be
the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of
1%) charged to Bank of America on such day on such transactions as determined
by the Administrative Agent.


 


11





















 


“Fee Letter” means the letter
agreement, dated June 20, 2005, among the Borrower, the Administrative
Agent, the Arranger, and Banc of America Bridge LLC.


 


“Foreign Lender” means any Lender that
is organized under the laws of a jurisdiction other than that in which the
Borrower is resident for tax purposes. 
For purposes of this definition, the United States, each State thereof
and the District of Columbia shall be deemed to constitute a single
jurisdiction.


 


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


 


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


 


“GAAP” means generally accepted
accounting principles in the United States set forth in the opinions and
pronouncements of the Accounting Principles Board and the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board or such other principles as may be approved by a
significant segment of the accounting profession in the United States, that are
applicable to the circumstances as of the date of determination, consistently
applied.


 


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


 


“Granting Lender” has the meaning
specified in Section 10.06(h).


 


“Guarantee” means, as to any Person, (a)
any obligation, contingent or otherwise, of such Person guaranteeing or having
the economic effect of guaranteeing any Indebtedness or other obligation
payable by another Person (the “primary obligor”) in any manner, whether
directly or indirectly, and including any obligation of such Person, direct or
indirect, (i) to purchase or pay (or advance or supply funds for the purchase
or payment of) such Indebtedness or other obligation, (ii) to purchase or lease
property, securities or services for the purpose of assuring the obligee in
respect of such Indebtedness or other obligation of the payment or performance
of such Indebtedness or other obligation, (iii) to maintain working capital,
equity capital or any other financial statement condition or liquidity or level
of income or cash flow of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation, or (iv) entered into for
the purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or
(b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person (or any right, contingent or otherwise, of
any holder of such Indebtedness to obtain any such Lien).  The amount of any


 


12





















 


Guarantee shall be deemed to be an amount
equal to the stated or determinable amount of the related primary obligation,
or portion thereof, in respect of which such Guarantee is made.  The term “Guarantee” as a verb has a
corresponding meaning.


 


“Guarantors” means, collectively, each
Restricted Subsidiary of the Borrower.


 


“Guaranty” means the Guaranty made by
the Guarantors in favor of the Administrative Agent and the Lenders,
substantially in the form of Exhibit F.


 


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


 


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


 


“Hedging Termination Value”
means, in respect of any one or more Hedging Contracts, after taking into
account the effect of any legally enforceable netting agreement relating to
such Hedging Contracts, (a) for any date on or after the date such Hedging
Contracts have been closed out and termination value(s) determined in accordance
therewith, such termination value(s), and (b) for any date prior to the date
referenced in clause (a), the amount(s) determined as the mark-to-market
value(s) for such Hedging Contracts, as determined based upon one or more
mid-market or other readily available quotations provided by any recognized
dealer in such Hedging Contracts (which may include a Lender or any Affiliate
of a Lender).


 


“Honor Date” has the
meaning specified in Section 2.03(c)(i).


 


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


 


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


 


13





















 


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


 


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


 


(d)                                 all obligations of
such Person to pay the deferred purchase price of property or services (other
than trade accounts payable in the ordinary course of business and, in each case,
not past due for more than 60 days after the date on which such trade account
payable was created);


 


(e)                                  indebtedness
(excluding prepaid interest thereon) secured by a Lien (other than Liens
described in Section 7.01(l)) on property owned or being purchased by such
Person (including indebtedness arising under conditional sales or other title
retention agreements), whether or not such indebtedness shall have been assumed
by such Person or is limited in recourse;


 


(f)                                   capital leases and
Synthetic Lease Obligations;


 


(g)                                  all obligations of
such Person to purchase, redeem, retire, defease or otherwise make any payment
in respect of any Equity Interest in such Person (other than as permitted
pursuant to Section 7.06) or any other Person, valued, in the case of a
redeemable preferred interest, at the greater of its voluntary or involuntary
liquidation preference plus accrued and unpaid dividends; and


 


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


 


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


 


“Indemnified Taxes” means Taxes other
than Excluded Taxes.


 


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


 


“Information” has the meaning
specified in Section 10.07.


 


“Initial Financial Statements” means:


 


(a)                                 the Audited Financial
Statements;


 


(b)                                 the audited
consolidated financial statements of the Borrower as of December 31, 2002 and December
31, 2003;


 


14





















 


(c)                                  the unaudited consolidated
financial statements of the Borrower as of March 31, 2005; and


 


(d)                                 the pro forma consolidated balance sheet of the Borrower and the
Restricted Subsidiaries as of March 31, 2005 after giving effect to the
Acquisition.


 


“Interest Payment Date” means, (a) as
to any Loan other than a Base Rate Loan, the last day of each Interest Period
applicable to such Loan and the Maturity Date; provided, however,
that if any Interest Period for a Eurodollar Rate Loan exceeds three months,
the respective dates that fall every three months after the beginning of such
Interest Period shall also be Interest Payment Dates; and (b) as to any Base
Rate Loan, the last Business Day of each March, June, September and December
and the Maturity Date.


 


“Interest Period” means, as to each
Eurodollar Rate Loan, the period commencing on the date such Eurodollar Rate
Loan is disbursed or converted to or continued as a Eurodollar Rate Loan and
ending on the date one, two, three or six months thereafter, as selected by the
Borrower in its Loan Notice or such other period that is twelve months or less
requested by the Borrower and consented to by all the Lenders; provided
that:


 


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


 


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


 


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


 


“Internal Control Event” means (a) a determination
of a material weakness in, or (b) any fraud that involves management or other
employees who have a significant role in, the Borrower’s internal controls over
financial reporting, in each case as described in the Securities Laws.


 


“Investment” means, as to any Person,
any direct or indirect acquisition or investment by such Person, whether by
means of (a) the purchase or other acquisition of Equity Interests of another
Person, or (b) a loan, advance or capital contribution to, Guarantee or
assumption of Indebtedness of, or purchase or other acquisition of any other Indebtedness
or Equity Interests of, another Person, including any partnership or joint
venture interest in such other Person and any arrangement pursuant to which the
investor Guarantees Indebtedness of such other Person.  For purposes of covenant compliance, the
amount of any Investment shall be the amount actually invested, without
adjustment for subsequent increases or decreases in the value of such
Investment.


 


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


 


15





















 


“IRS” means the United States Internal
Revenue Service.


 


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


 


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


 


“Kinder Morgan Gas Processing Agreement”
means that certain Gas Processing Contract dated as of January 1, 2004, between
Copano Processing, L.P. and Kinder Morgan Texas Pipeline, L.P., and that
certain related Letter Agreement between Copano Processing, L.P. and Kinder
Morgan Texas Pipeline, L.P., regarding prepayment of carbon dioxide handling
fees, together with all amendments and modifications thereto permitted to be
made by this Agreement.


 


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


 


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


 


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


 


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


 


“L/C Issuer” means Bank of America in
its capacity as issuer of Letters of Credit hereunder, or any successor issuer
of Letters of Credit hereunder.


 


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


 


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


 


16





















 


“Lender Counterparty” means a Lender
or an Affiliate of a Lender.


 


“Lender Hedging Obligations” means all
obligations arising from time to time under Hedging Contracts entered into from
time to time between the Borrower or any Guarantor and a Lender Counterparty;
provided that (a) if such Lender Counterparty ceases to be a Lender hereunder
or an Affiliate of a Lender hereunder, Lender Hedging Obligations shall only
include such obligations to the extent arising from transactions entered into
at the time such counterparty was a Lender hereunder or an Affiliate of a
Lender hereunder, and (b) for any of the forgoing to be included within “Lender
Hedging Obligations” hereunder, the applicable Lender Counterparty must have
provided the Administrative Agent written notice of the existence thereof and
such transaction must not otherwise be prohibited under this Agreement.


 


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


 


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


 


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


 


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


 


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


 


“Letter of Credit Sublimit” means an
amount equal to $25,000,000.  The Letter
of Credit Sublimit is part of, and not in addition to, the Aggregate
Commitments.


 


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


 


“Loan” has the meaning specified in Section 2.01.


 


“Loan Documents” means this Agreement,
each Note, each Issuer Document, each Security Document, the Fee Letter and all
other agreements, certificates, documents, instruments and writings at any time
delivered in connection herewith or therewith (exclusive of term sheets and
commitment letters).


 


“Loan Notice” means a notice of (a) a
Borrowing, (b) a conversion of Loans from one Type to the other, or (c) a
continuation of Eurodollar Rate Loans, pursuant to Section 2.02(a),
which, if in writing, shall be substantially in the form of Exhibit A.


 


17





















 


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


 


“Maintenance Capital Expenditures”
means, for any period, all amounts properly classified as capital expenditures
under GAAP that are employed to replace partially or fully depreciated assets
to maintain the existing operating capacity of assets and to extend their
useful lives, or other amounts classified as capital expenditures under GAAP
that are incurred in maintaining existing system volumes and related cash
flows, excluding all costs associated with new well hook-ups.


 


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


 


“Material Contracts” means (a) the
Acquisition Documents, (b) the Kinder Morgan Gas Processing Agreement, (c) the
New Dominion Gas Purchase Agreement, and (d) any other contract or arrangement
to which the Borrower or any of its Restricted Subsidiaries is a party (other
than the Loan Documents) that constitutes ten percent (10%) or more of the
aggregate revenue of the Loan Parties on a consolidated basis.


 


“Maturity Date” means July 31, 2010.


 


“Maximum Rate” has the meaning
specified in Section 10.09.


 


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


 


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


 


“Net Cash Proceeds” means the remainder
of (a) the gross proceeds received by any Loan Party from (i) a Disposition, (ii) the issuance of Additional Debt, or (iii) the issuance
of Additional Equity, as applicable, less (b) underwriter discounts and
commissions, investment banking fees, legal, accounting and other professional
fees and expenses, and other usual and customary transaction costs, in each
case only to the extent paid or payable by a Loan Party in cash and related to
such Disposition, Additional Debt issuance, or Additional Equity issuance, as
applicable.


 


“New Dominion Gas Purchase Agreement”
means that certain Amended and Restated Gas Purchase and Processing  Agreement dated May 1, 2005  between ScissorTail, Buyer/Processor, and New
Dominion, L.L.C., Supplier.


 


“Non-Recourse Debt” means any
Indebtedness of any Unrestricted Subsidiary, in each case in respect of which:
(a) the holder or holders thereof (i) shall have recourse only to, and 


 


18





















 


shall have the right to require the obligations
of such Unrestricted Subsidiary to be performed, satisfied, and paid only out
of, the property of such Unrestricted Subsidiary and/or one or more of its
Subsidiaries (but only to the extent that such Subsidiaries are Unrestricted
Subsidiaries) and/or any other Person (other than the Borrower and/or any
Restricted Subsidiary) and (ii) shall have no direct or indirect recourse
(including by way of guaranty, support or indemnity) to the Borrower or any
Restricted Subsidiary or to any of the property of the Borrower or any
Restricted Subsidiary, whether for principal, interest, fees, expenses or
otherwise; and (b) with respect to any such Indebtedness of any Unrestricted
Subsidiary in which the Borrower directly or indirectly owns 75% or more of the
Equity Interests thereof, the terms and conditions relating to the non-recourse
nature of such Indebtedness are in form and substance reasonably acceptable to
the Administrative Agent.


 


“Note” means a promissory note made by
the Borrower in favor of a Lender evidencing Loans made by such Lender,
substantially in the form of Exhibit C.


 


“Obligations” means the Lender Hedging
Obligations and all advances to, and debts, liabilities, obligations, covenants
and duties of, any Loan Party arising under any Loan Document or otherwise with
respect to any Loan or Letter of Credit, whether direct or indirect (including
those acquired by assumption), absolute or contingent, due or to become due,
now existing or hereafter arising and including interest and fees that accrue
after the commencement by or against any Loan Party of any proceeding under any
Debtor Relief Laws naming such Person as the debtor in such proceeding,
regardless of whether such interest and fees are allowed claims in such
proceeding.


 


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


 


“Other Taxes” means all present or
future stamp or documentary taxes or any other excise or property taxes,
charges or similar levies arising from any payment made hereunder or under any
other Loan Document or from the execution, delivery or enforcement of, or
otherwise with respect to, this Agreement or any other Loan Document.


 


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


 


19





















 


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


 


“PBGC” means the Pension Benefit
Guaranty Corporation.


 


“Pension Plan” means any “employee
pension benefit plan” (as such term is defined in Section 3(2) of ERISA), other
than a Multiemployer Plan, that is subject to Title IV of ERISA and is
sponsored or maintained by the Borrower or any ERISA Affiliate or to which the
Borrower or any ERISA Affiliate contributes or has an obligation to contribute,
or in the case of a multiple employer or other plan described in Section
4064(a) of ERISA, has made contributions at any time during the immediately
preceding five plan years.


 


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


 


“Plan” means any “employee benefit
plan” (as such term is defined in Section 3(3) of ERISA) established by the
Borrower or, with respect to any such plan that is subject to Section 412 of
the Code or Title IV of ERISA, any ERISA Affiliate.


 


“Pledge and Security Agreement” means
the Pledge and Security Agreement made by the Loan Parties in favor of the
Administrative Agent, substantially in the form of Exhibit G.


 


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


 


“Registered Public Accounting Firm”
has the meaning specified in the Securities Laws and shall be independent of
the Borrower as prescribed by the Securities Laws.


 


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


 


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


 


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


 


“Required Lenders” means, as of any
date of determination, Lenders having more than 50% of the Aggregate
Commitments or, if the commitment of each Lender to make Loans and the
obligation of the L/C Issuer to make L/C Credit Extensions have been terminated
pursuant to Section 8.02, Lenders holding in the aggregate more
than 50% of the Total Outstandings (with the aggregate amount of each Lender’s
risk participation and funded participation in L/C Obligations being deemed “held”
by such Lender for purposes of this definition); provided that the
Commitment of, and the portion of the Total Outstandings held or deemed held
by, any Defaulting Lender shall be excluded for purposes of making a
determination of Required Lenders.


 


20





















 


“Responsible Officer” means the chief
executive officer, president, chief financial officer, vice president, manager,
treasurer or assistant treasurer of a Loan Party (or any general partner,
managing member or Person in a similar capacity with respect thereto).  Any document delivered hereunder that is
signed by a Responsible Officer of a Loan Party shall be conclusively presumed
to have been authorized by all necessary corporate, partnership and/or other
action on the part of such Loan Party and such Responsible Officer shall be
conclusively presumed to have acted on behalf of such Loan Party.


 


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


 


“Restricted Subsidiary” means each
Subsidiary of the Borrower that is not an Unrestricted Subsidiary.


 


“Risk Management Policy” means the
Risk Management Policy attached hereto as Exhibit K, as the same may be
revised, amended, supplemented, modified or replaced from time to time (with
any material revisions, amendments, supplements, modifications or replacements
being reasonably satisfactory to Administrative Agent).


 


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


 


“Sarbanes-Oxley” means the
Sarbanes-Oxley Act of 2002.


 


“ScissorTail” means ScissorTail
Energy, LLC, a Delaware limited liability company.


 


“ScissorTail Credit Facility” means that
certain Amended and Restated Loan and Security Agreement, dated as of May 30,
2002, as amended, among ScissorTail, Bank of America, N.A. and the other
lenders party thereto.


 


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


 


“Secured Hedging Obligations” means
(a) Lender Hedging Obligations and (b) all obligations arising from time to
time under Hedging Contracts entered into from time to time between the
Borrower or any Guarantor and an Approved Counterparty, provided that (i) if
such Approved Counterparty ceases to be an Approved Counterparty, Secured Hedging
Obligations shall only include such obligations to the extent arising from
transactions entered into at the time such Person was an Approved Counterparty,
and (ii) for any of the forgoing to be included within “Secured Hedging
Obligations” hereunder, the applicable Approved Counterparty must have provided
the Administrative Agent written notice of the existence thereof and such
transaction must not otherwise be prohibited under this Agreement.


 


21





















 


“Securities Laws” means the Securities
Act of 1933, the Securities Exchange Act of 1934, Sarbanes-Oxley and the
applicable accounting and auditing principles, rules, standards and practices
promulgated, approved or incorporated by the SEC or the Public Company
Accounting Oversight Board, as each of the foregoing may be amended and in
effect on any applicable date hereunder.


 


“Security Documents” means the
instruments listed in the Security Schedule and all other security agreements,
deeds of trust, mortgages, pledges, deposit instruments, guarantees, financing
statements, continuation statements, extension agreements and other agreements
or instruments now, heretofore, or hereafter delivered by any Loan Party to
Administrative Agent in connection with this Agreement or any transaction
contemplated hereby to secure or guarantee the payment of any part of the
Obligations or the performance of any Loan Party’s other duties and obligations
under the Loan Documents.


 


“Security Schedule” means Schedule
1.01 hereto.


 


“Senior Bridge Facility” means that
certain Term Loan Agreement of even date herewith between the Borrower and Banc
of America Bridge LLC.


 


“Solvent” and “Solvency” mean,
with respect to any Person on a particular date, that on such date both (a) (i)
the fair value of the property of such Person is greater than the total amount
of liabilities, including, without limitation, contingent liabilities, of such
Person, (ii) the present fair salable value of the assets of such Person is not
less than the amount that will be required to pay the probable liability of
such Person on its debts as they become absolute and matured, (iii) such Person
does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person’s ability to pay such debts and liabilities as
they mature, and (iv) such Person is not engaged in business or a transaction,
and is not about to engage in business or a transaction, for which such Person’s
property would constitute an unreasonably small capital, and (b) such Loan Party
is “solvent” within the meaning given that term and similar terms under
applicable laws relating to fraudulent transfers and conveyances.  The amount of contingent liabilities at any
time shall be computed as the amount that, in the light of all the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability (irrespective of whether
such contingent liabilities meet the criteria for accrual under Statement of
Financial Accounting Standard No. 5).


 


“Southern Dome” means Southern Dome,
LLC, a Delaware limited liability company, in which Borrower owns, directly or
indirectly, a majority interest.


 


“SPC” has the meaning specified in Section 10.06(h).


 


“Subordinated Debt” means all Indebtedness
of the Borrower and its Restricted Subsidiaries on a consolidated basis for
money borrowed (a) the structure, amount, term, tenor and incurrence thereof is
approved in writing by the Required Lenders, (b) on terms and conditions less
restrictive than the Loan Documents, and (c) subordinated, upon terms
satisfactory to the Administrative Agent (which may include payment
restrictions, restrictions on enforcement of remedies, restrictions on
amendment or modification of the terms and conditions 


 


22





















 


of such Indebtedness and restrictions on such
creditor’s rights in insolvency or bankruptcy proceedings), in right of payment
to the payment in full in cash of all Obligations.


 


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


 


“Synthetic Lease Obligation” means the
monetary obligation of a Person under (a) a so-called synthetic, off-balance
sheet or tax retention lease, or (b) an agreement for the use or possession of
property creating obligations that do not appear on the balance sheet of such
Person but which, upon the insolvency or bankruptcy of such Person, would be
characterized as the indebtedness of such Person (without regard to accounting
treatment).


 


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


 


“Threshold Amount” means $5,000,000.


 


“Total Outstandings” means the
aggregate Outstanding Amount of all Loans and all L/C Obligations.


 


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


 


“Unfunded Pension Liability” means the
excess of a Pension Plan’s benefit liabilities under Section 4001(a)(16) of
ERISA, over the current value of that Pension Plan’s assets, determined in
accordance with the assumptions used for funding the Pension Plan pursuant to
Section 412 of the Code for the applicable plan year.


 


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


 


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


 


“Unrestricted Subsidiary” means Estes
Cove Facilities, L.L.C., Nueces Gathering, L.L.C., Southern Dome, Webb/Duval Gatherers,
or any other Subsidiary of the Borrower designated as such on Schedule 5.13
or which the Borrower has designated in writing to the Administrative Agent to
be an Unrestricted Subsidiary pursuant to Section 7.18.


 


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


 


23





















 


(a)                           The definitions of terms
herein shall apply equally to the singular and plural forms of the terms
defined.  Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms.  The words “include,”
“includes” and “including” shall be deemed to be followed by the
phrase “without limitation.”  The word “will”
shall be construed to have the same meaning and effect as the word “shall.”  Unless the context requires otherwise, (i)
any definition of or reference to any agreement, instrument or other document
(including any Organization Document) shall be construed as referring to such
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein or in any other Loan
Document), (ii) any reference herein to any Person shall be construed to
include such Person’s successors and assigns, (iii) the words “herein,” “hereof”
and “hereunder,” and words of similar import when used in any Loan
Document, shall be construed to refer to such Loan Document in its entirety and
not to any particular provision thereof, (iv) all references in a Loan Document
to Articles, Sections, Exhibits and Schedules shall be construed to refer to
Articles and Sections of, and Exhibits and Schedules to, the Loan Document in
which such references appear, (v) any reference to any Law shall include all
statutory and regulatory provisions consolidating, amending, replacing or
interpreting such Law and any reference to any Law or regulation shall, unless
otherwise specified, refer to such Law or regulation as amended, modified or
supplemented from time to time, and (vi) the words “asset” and “property”
shall be construed to have the same meaning and effect and to refer to any and
all tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.


 


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


 


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


 


1.03                        Accounting
Terms.


 


(a)                           Generally.  All
accounting terms not specifically or completely defined herein shall be
construed in conformity with, and all financial data (including financial
ratios and other financial calculations) required to be submitted pursuant to
this Agreement shall be prepared in conformity with, GAAP applied on a
consistent basis, as in effect from time to time, applied in a manner
consistent with that used in preparing the Audited Financial Statements, except
as otherwise specifically prescribed herein.


 


(b)                           Changes in GAAP.  If
at any time any change in GAAP would affect the computation of any financial
ratio or requirement set forth in any Loan Document, and either the Borrower or
the Required Lenders shall so request, the Administrative Agent, the Lenders
and the Borrower shall negotiate in good faith to amend such ratio or
requirement to preserve the original intent thereof in light of such change in
GAAP (subject to the approval of the Required Lenders); provided that, until so
amended, (i) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein and (ii) the Borrower 


 


24





















 


shall provide to the Administrative Agent and the Lenders financial
statements and other documents required under this Agreement or as reasonably
requested hereunder setting forth a reconciliation between calculations of such
ratio or requirement made before and after giving effect to such change in
GAAP.


 


(c)                            Consolidation of
Variable Interest Entities.  All references herein to
consolidated financial statements of the Borrower and its Subsidiaries or to the
determination of any amount for the Borrower and its Subsidiaries on a
consolidated basis or any similar reference shall, in each case, be deemed to
include each variable interest entity that the Borrower is required to
consolidate pursuant to FASB Interpretation No. 46 – Consolidation of Variable
Interest Entities: an interpretation of ARB No. 51 (January 2003) as if
such variable interest entity were a Subsidiary as defined herein.


 


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


 


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


 


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


 


ARTICLE II.

THE COMMITMENTS AND CREDIT EXTENSIONS


 


2.01                        Loans.  Subject to the terms and conditions set forth
herein, each Lender severally agrees to make loans (each such loan, a “Loan”)
to the Borrower from time to time, on any Business Day during the Availability
Period, in an aggregate amount not to exceed at any time outstanding the amount
of such Lender’s Commitment; provided, however, that after giving
effect to any Borrowing, (i) the Total Outstandings shall not exceed the
Aggregate Commitments, and (ii) the aggregate Outstanding Amount of the Loans
of any Lender, plus such Lender’s Applicable Percentage of the
Outstanding Amount of all L/C Obligations shall not exceed such Lender’s
Commitment.  Within the limits of each
Lender’s Commitment, and subject to the other terms and conditions hereof, the
Borrower may borrow under this Section 2.01, prepay under Section 2.05,
and reborrow under this Section 2.01.  Loans may be Base Rate Loans or Eurodollar
Rate Loans, as further provided herein.


 


25























 


2.02        Borrowings,
Conversions and Continuations of Loans.


 


(a)         Each
Borrowing, each conversion of Loans from one Type to the other, and each
continuation of Eurodollar Rate Loans shall be made upon the Borrower’s
irrevocable notice to the Administrative Agent, which may be given by
telephone.  Each such notice must be
received by the Administrative Agent not later than 11:00 a.m. (i) three
Business Days prior to the requested date of any Borrowing of, conversion to or
continuation of Eurodollar Rate Loans or of any conversion of Eurodollar Rate
Loans to Base Rate Loans, and (ii) on the requested date of any Borrowing of Base
Rate Loans; provided, however, that if the Borrower wishes to
request Eurodollar Rate Loans having an Interest Period other than one, two,
three or six months in duration as provided in the definition of “Interest
Period”, the applicable notice must be received by the Administrative Agent not
later than 11:00 a.m. four Business Days prior to the requested date of such
Borrowing, conversion or continuation, whereupon the Administrative Agent shall
give prompt notice to the Lenders of such request and determine whether the
requested Interest Period is acceptable to all of them.  Not later than 11:00 a.m., three Business
Days before the requested date of such Borrowing, conversion or continuation,
the Administrative Agent shall notify the Borrower (which notice may be by
telephone) whether or not the requested Interest Period has been consented to
by all the Lenders.  Each telephonic
notice by the Borrower pursuant to this Section 2.02(a) must be
confirmed promptly by delivery to the Administrative Agent of a written Loan
Notice, appropriately completed and signed by a Responsible Officer of the
Borrower.  Each Borrowing of, conversion
to or continuation of Eurodollar Rate Loans shall be in a principal amount of
$5,000,000 or a whole multiple of $1,000,000 in excess thereof.  Except as provided in Section 2.03(c),
each Borrowing of or conversion to Base Rate Loans shall be in a principal
amount of $500,000 or a whole multiple of $100,000 in excess thereof.  Each Loan Notice (whether telephonic or
written) shall specify (i) whether the Borrower is requesting a Borrowing, a
conversion of Loans from one Type to the other, or a continuation of Eurodollar
Rate Loans, (ii) the requested date of the Borrowing, conversion or
continuation, as the case may be (which shall be a Business Day), (iii) the
principal amount of Loans to be borrowed, converted or continued, (iv) the Type
of Loans to be borrowed or to which existing Loans are to be converted, and (v)
if applicable, the duration of the Interest Period with respect thereto.  If the Borrower fails to specify a Type of Loan
in a Loan Notice or if the Borrower fails to give a timely notice requesting a
conversion or continuation, then the applicable Loans shall be made as, or
converted to, Base Rate Loans.  Any such
automatic conversion to Base Rate Loans shall be effective as of the last day
of the Interest Period then in effect with respect to the applicable Eurodollar
Rate Loans.  If the Borrower requests a
Borrowing of, conversion to, or continuation of Eurodollar Rate Loans in any
such Loan Notice, but fails to specify an Interest Period, it will be deemed to
have specified an Interest Period of one month.


 


(b)         Following
receipt of a Loan Notice, the Administrative Agent shall promptly notify each
Lender of the amount of its Applicable Percentage of the applicable Loans, and
if no timely notice of a conversion or continuation is provided by the Borrower,
the Administrative Agent shall notify each Lender and the Borrower of the
details of any automatic conversion to Base Rate Loans described in the
preceding subsection.  In the case of a Borrowing,
each Lender shall make the amount of its Loan available to the Administrative
Agent in immediately available funds at the Administrative Agent’s Office not
later than 1:00 p.m. on the Business Day specified in the applicable Loan
Notice.  Upon satisfaction of the
applicable conditions set 


 


26





















 


forth in Section 4.02 (and, if such Borrowing is the
initial Credit Extension, Section 4.01), the Administrative Agent
shall make all funds so received available to the Borrower in like funds as
received by the Administrative Agent either by (i) crediting the account of the
Borrower on the books of Bank of America with the amount of such funds or (ii)
wire transfer of such funds, in each case in accordance with instructions
provided to (and reasonably acceptable to) the Administrative Agent by the
Borrower; provided, however, that if, on the date the Loan Notice
with respect to such Borrowing is given by the Borrower, there are L/C
Borrowings outstanding, then the proceeds of such Borrowing, first,
shall be applied to the payment in full of any such L/C Borrowings, and second,
shall be made available to the Borrower as provided above.


 


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


 


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


 


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


 


2.03        Letters of
Credit.


 


(a)         The
Letter of Credit Commitment.


 


(i)              Subject
to the terms and conditions set forth herein, (A) the L/C Issuer agrees, in
reliance upon the agreements of the Lenders set forth in this Section 2.03,
(1) from time to time on any Business Day during the period from the
Closing Date until the Letter of Credit Expiration Date, to issue Letters of
Credit for the account of the Borrower or its Restricted Subsidiaries, and to
amend Letters of Credit previously issued by it, in accordance with
subsection (b) below, and (2) to honor drawings under the Letters of
Credit; and (B) the Lenders severally agree to participate in Letters of
Credit issued for the account of the Borrower or its Restricted Subsidiaries and any drawings thereunder; provided
that after giving effect to any L/C Credit Extension with respect to any Letter
of Credit, (x) the Total Outstandings shall not exceed the Aggregate
Commitments, (y) the aggregate Outstanding Amount of the Loans of any
Lender, plus such Lender’s Applicable Percentage of the Outstanding
Amount of all L/C Obligations shall not exceed such Lender’s Commitment, and
(z) the Outstanding Amount of the L/C Obligations shall not exceed the Letter
of Credit Sublimit.  Each request by the
Borrower for the issuance or amendment of a Letter of Credit shall be deemed to
be a representation by the Borrower that the L/C Credit Extension so requested
complies with the conditions set forth in the proviso to the preceding
sentence.  Within the foregoing limits,
and subject to the terms 


 


27





















 


and conditions hereof, the Borrower’s ability to obtain Letters of
Credit shall be fully revolving, and accordingly the Borrower may, during the
foregoing period, obtain Letters of Credit to replace Letters of Credit that
have expired or that have been drawn upon and reimbursed.  All Existing Letters of Credit shall be
deemed to have been issued pursuant hereto, and from and after the Closing Date
shall be subject to and governed by the terms and conditions hereof.


 


(ii)             The
L/C Issuer shall not issue any Letter of Credit, if:


 


(A)          the
expiry date of such requested Letter of Credit would occur more than twelve months
after the date of issuance, unless the Required Lenders have approved such
expiry date; or


 


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


 


(iii)            The
L/C Issuer shall not be under any obligation to issue any Letter of Credit if:


 


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


 


(B)          the
issuance of such Letter of Credit would violate one or more policies of the L/C
Issuer;


 


(C)          except
as otherwise agreed by the Administrative Agent and the L/C Issuer, such Letter
of Credit is in an initial stated amount less than $50,000;


 


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


 


(E)           such
Letter of Credit contains any provisions for automatic reinstatement of the
stated amount after any drawing thereunder; or


 


(F)           a
default of any Lender’s obligations to fund under Section 2.03(c) exists
or any Lender is at such time a Defaulting Lender hereunder, unless the L/C 


 


28





















 


Issuer has entered into satisfactory arrangements with the Borrower or
such Lender to eliminate the L/C Issuer’s risk with respect to such Lender.


 


(iv)            The
L/C Issuer shall not amend any Letter of Credit if the L/C Issuer would not be
permitted at such time to issue such Letter of Credit in its amended form under
the terms hereof.


 


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


 


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


 


(b)         Procedures
for Issuance and Amendment of Letters of Credit.


 


(i)              Each
Letter of Credit shall be issued or amended, as the case may be, upon the
request of the Borrower delivered to the L/C Issuer (with a copy to the
Administrative Agent) in the form of a Letter of Credit Application,
appropriately completed and signed by a Responsible Officer of the
Borrower.  Such Letter of Credit
Application must be received by the L/C Issuer and the Administrative Agent not
later than 11:00 a.m. at least two Business Days (or such later date and time
as the Administrative Agent and the L/C Issuer may agree in a particular
instance in their sole discretion) prior to the proposed issuance date or date
of amendment, as the case may be.  In the
case of a request for an initial issuance of a Letter of Credit, such Letter of
Credit Application shall specify in form and detail satisfactory to the L/C
Issuer: (A) the proposed issuance date of the requested Letter of Credit (which
shall be a Business Day); (B) the amount thereof; (C) the expiry date thereof;
(D) the name and address of the beneficiary thereof; (E) the documents to be
presented by such beneficiary in case of any drawing thereunder; (F) the full
text of any certificate to be presented by such beneficiary in case of any
drawing thereunder; and (G) such other matters as the L/C Issuer may reasonably
require.  In the case of a request for an
amendment of any outstanding Letter of Credit, such Letter of Credit
Application shall specify in form and detail satisfactory to the L/C Issuer (A)
the Letter of Credit to be amended; (B) the proposed date of amendment thereof
(which shall be a Business Day); (C) the nature of the proposed amendment; and
(D) such other matters as the L/C Issuer may reasonably require.  Additionally, the Borrower shall furnish to
the L/C Issuer and the Administrative Agent such other documents and
information pertaining to such requested Letter of Credit issuance or
amendment, including any Issuer Documents, as the L/C Issuer or the
Administrative Agent may reasonably require.


 


29





















 


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


 


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


 


(c)         Drawings
and Reimbursements; Funding of Participations.


 


(i)              Upon
receipt from the beneficiary of any Letter of Credit of any notice of a drawing
under such Letter of Credit, the L/C Issuer shall notify the Borrower and the
Administrative Agent thereof.  Not later
than 11:00 a.m. on the date of any payment by the L/C Issuer under a Letter of
Credit (each such date, an “Honor Date”), the Borrower shall reimburse
the L/C Issuer through the Administrative Agent in an amount equal to the
amount of such drawing.  If the Borrower
fails to so reimburse the L/C Issuer by such time, the Administrative Agent
shall promptly notify each Lender of the Honor Date, the amount of the
unreimbursed drawing (the “Unreimbursed Amount”), and the amount of such
Lender’s Applicable Percentage thereof. 
In such event, the Borrower shall be deemed to have requested a Borrowing
of Base Rate Loans to be disbursed on the Honor Date in an amount equal to the
Unreimbursed Amount, without regard to the minimum and multiples specified in Section 2.02
for the principal amount of Base Rate Loans, but subject to the amount of the
unutilized portion of the Aggregate Commitments and the conditions set forth in
Section 4.02 (other than the delivery of a Loan Notice).  Any notice given by the L/C Issuer or the
Administrative Agent pursuant to this Section 2.03(c)(i) may be
given by telephone if immediately confirmed in writing; provided that
the lack of such an immediate confirmation shall not affect the conclusiveness
or binding effect of such notice.


 


(ii)             Each
Lender shall upon any notice pursuant to Section 2.03(c)(i) make
funds available to the Administrative Agent for the account of the L/C Issuer
at the Administrative Agent’s Office in an amount equal to its Applicable
Percentage of the Unreimbursed Amount not later than 1:00 p.m. on the Business
Day specified in such 


 


30





















 


notice by the Administrative Agent, whereupon, subject to the
provisions of Section 2.03(c)(iii), each Lender that so makes funds
available shall be deemed to have made a Base Rate Loan to the Borrower in such
amount.  The Administrative Agent shall
remit the funds so received to the L/C Issuer.


 


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


 


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


 


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


 


(vi)            If
any Lender fails to make available to the Administrative Agent for the account
of the L/C Issuer any amount required to be paid by such Lender pursuant to the
foregoing provisions of this Section 2.03(c) by the time specified
in Section 2.03(c)(ii), the L/C Issuer shall be entitled to recover
from such Lender (acting through the Administrative Agent), on demand, such
amount with interest thereon for the period from the date such payment is
required to the date on which such payment is immediately available to the L/C
Issuer at a rate per annum equal to the greater of the Federal Funds Rate and a
rate determined by the L/C Issuer in accordance with banking industry rules on
interbank compensation.  A certificate of
the L/C Issuer submitted to any Lender (through the Administrative Agent) with
respect to any amounts owing under this clause (vi) shall be conclusive absent
manifest error.


 


31





















 


(d)         Repayment
of Participations.


 


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


 


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


 


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


 


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


 


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


 


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


 


(iv)            any
payment by the L/C Issuer under such Letter of Credit against presentation of a
draft or certificate that does not strictly comply with the terms of such
Letter of Credit; or any payment made by the L/C Issuer under such Letter of Credit
to any 


 


32





















 


Person purporting to be a trustee in bankruptcy, debtor-in-possession,
assignee for the benefit of creditors, liquidator, receiver or other
representative of or successor to any beneficiary or any transferee of such
Letter of Credit, including any arising in connection with any proceeding under
any Debtor Relief Law; or


 


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


 


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


 


(f)          Role
of L/C Issuer.  Each
Lender and the Borrower agree that, in paying any drawing under a Letter of
Credit, the L/C Issuer shall not have any responsibility to obtain any document
(other than any sight draft, certificates and documents expressly required by
the Letter of Credit) or to ascertain or inquire as to the validity or accuracy
of any such document or the authority of the Person executing or delivering any
such document.  None of the L/C Issuer,
the Administrative Agent, any of their respective Related Parties nor any
correspondent, participant or assignee of the L/C Issuer shall be liable to any
Lender for (i) any action taken or omitted in connection herewith at the
request or with the approval of the Lenders or the Required Lenders, as
applicable; (ii) any action taken or omitted in the absence of gross negligence
or willful misconduct; or (iii) the due execution, effectiveness, validity or
enforceability of any document or instrument related to any Letter of Credit or
Issuer Document.  The Borrower hereby
assumes all risks of the acts or omissions of any beneficiary or transferee
with respect to its use of any Letter of Credit; provided, however,
that this assumption is not intended to, and shall not, preclude the Borrower’s
pursuing such rights and remedies as it may have against the beneficiary or
transferee at law or under any other agreement. 
None of the L/C Issuer, the Administrative Agent, any of their
respective Related Parties nor any correspondent, participant or assignee of
the L/C Issuer shall be liable or responsible for any of the matters described
in clauses (i) through (v) of Section 2.03(e); provided, however,
that anything in this Section 2.03 to the contrary notwithstanding, the
Borrower may have a claim against the L/C Issuer, and the L/C Issuer may be
liable to the Borrower, to the extent, but only to the extent, of any direct,
as opposed to consequential or exemplary, damages suffered by the Borrower
which the Borrower proves were caused by the L/C Issuer’s willful misconduct or
gross negligence or the L/C Issuer’s willful failure to pay under any Letter of
Credit after the presentation to it by the beneficiary of a sight draft and
certificate(s) strictly complying with the terms and conditions of a Letter of
Credit.  In furtherance and not in limitation of the
foregoing, the L/C Issuer may accept documents that appear on their face to be
in order, without responsibility for further investigation, regardless of any
notice or information to the contrary, and the L/C Issuer shall not be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may
prove to be invalid or ineffective for any reason.


 


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(g)         Cash
Collateral.  Upon the request of the Administrative Agent, (i) if
the L/C Issuer has honored any full or partial drawing request under any Letter
of Credit and such drawing has resulted in an L/C Borrowing, or (ii) if, as of
the Letter of Credit Expiration Date, any L/C Obligation for any reason remains
outstanding, the Borrower shall, in each case, immediately Cash Collateralize
the then Outstanding Amount of all L/C Obligations.  Sections 2.05 and 8.02(c)
set forth certain additional requirements to deliver Cash Collateral
hereunder.  For purposes of this Section 2.03,
Section 2.05 and Section8.02(c),
“Cash Collateralize” means to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of the L/C Issuer and the Lenders, as
collateral for the L/C Obligations, cash or deposit account balances pursuant
to documentation in form and substance satisfactory to the Administrative Agent
and the L/C Issuer (which documents are hereby consented to by the
Lenders).  Derivatives of such term have
corresponding meanings.  The Borrower
hereby grants to the Administrative Agent, for the benefit of the L/C Issuer
and the Lenders, a security interest in all such cash, deposit accounts and all
balances therein and all proceeds of the foregoing.  Cash Collateral shall be maintained in
blocked, non-interest bearing deposit accounts at Bank of America.


 


(h)         Applicability
of ISP.  Unless otherwise
expressly agreed by the L/C Issuer and the Borrower when a Letter of Credit is
issued (including any such agreement applicable to an Existing Letter of
Credit), the rules of the ISP shall apply to each Letter of Credit.


 


(i)          Letter
of Credit Fees.  The Borrower shall pay to the Administrative
Agent for the account of each Lender in accordance with its Applicable
Percentage a Letter of Credit fee (the “Letter of Credit Fee”) for each
Letter of Credit equal to the Applicable Rate times the daily amount
available to be drawn under such Letter of Credit.  For purposes of computing the daily amount
available to be drawn under any Letter of Credit, the amount of such Letter of
Credit shall be determined in accordance with Section 1.06.  Letter of Credit Fees shall be (i) computed
on a quarterly basis in arrears and (ii) due and payable on the last Business
Day of each March, June, September and December, commencing with the first such
date to occur after the issuance of such Letter of Credit, on the Letter of
Credit Expiration Date and thereafter on demand.  If there is any change in the Applicable Rate
during any quarter, the daily amount available to be drawn under each Letter of
Credit shall be computed and multiplied by the Applicable Rate separately for
each period during such quarter that such Applicable Rate was in effect.  Notwithstanding anything to the contrary
contained herein, while any Obligation bears interest at the Default Rate
pursuant to Section 2.08(b), all Letter of Credit Fees shall accrue at
the Default Rate.


 


(j)          Fronting
Fee and Documentary and Processing Charges Payable to L/C Issuer.  The
Borrower shall pay directly to the L/C Issuer for its own account a fronting
fee with respect to each Letter of Credit, at the rate per annum specified in
the Fee Letter, computed on the daily amount available to be drawn under such
Letter of Credit on a quarterly basis in arrears.  Such fronting fee shall be due and payable on
the tenth Business Day after receipt of an invoice therefore following the end
of each March, June, September and December in respect of the most
recently-ended quarterly period (or portion thereof, in the case of the first
payment), commencing with the first such date to occur after the issuance of
such Letter of Credit, on the Letter of Credit Expiration Date and thereafter
on demand.  For purposes of computing the
daily amount available to be drawn under any Letter of Credit, the amount of
such Letter of Credit 


 


34





















 


shall be
determined in accordance with Section 1.06.  In addition, the Borrower shall pay directly
to the L/C Issuer for its own account the customary issuance, presentation,
amendment and other processing fees, and other standard costs and charges, of
the L/C Issuer relating to letters of credit as from time to time in
effect.  Such customary fees and standard
costs and charges are due and payable on demand and are nonrefundable.


 


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


 


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


 


2.04        Reserved.


 


2.05        Prepayments.


 


(a)         The
Borrower may, upon notice to the Administrative Agent, at any time or from time
to time voluntarily prepay Loans in whole or in part without premium or
penalty; provided that (i) such notice must be received by the
Administrative Agent not later than 11:00 a.m. (A) three Business Days prior to
any date of prepayment of Eurodollar Rate Loans and (B) on the date of
prepayment of Base Rate Loans; (ii) any prepayment of Eurodollar Rate Loans
shall be in a principal amount of $5,000,000 or a whole multiple of $1,000,000
in excess thereof; and (iii) any prepayment of Base Rate Loans shall be in a
principal amount of $500,000 or a whole multiple of $100,000 in excess thereof
or, in each case, if less, the entire principal amount thereof then
outstanding.  Each such notice shall
specify the date and amount of such prepayment and the Type(s) of Loans to be
prepaid.  The Administrative Agent will
promptly notify each Lender of its receipt of each such notice, and of the
amount of such Lender’s Applicable Percentage of such prepayment.  If such notice is given by the Borrower, the
Borrower shall make such prepayment and the payment amount specified in such
notice shall be due and payable on the date specified therein.  Any prepayment of a Eurodollar Rate Loan
shall be accompanied by all accrued interest on the amount prepaid, together
with any additional amounts required pursuant to Section 3.05.  Each such prepayment shall be applied to the Loans
of the Lenders in accordance with their respective Applicable Percentages.


 


(b)         If
for any reason the Total Outstandings at any time exceed the Aggregate
Commitments then in effect, the Borrower shall immediately prepay Loans and/or
Cash Collateralize the L/C Obligations in an aggregate amount equal to such
excess; provided, however, that the Borrower shall not be
required to Cash Collateralize the L/C Obligations pursuant to this Section 2.05(b)
unless after the prepayment in full of the Loans the Total Outstandings exceed
the Aggregate Commitments then in effect.


 


35





















 


(c)         Any
Net Cash Proceeds that are Excess Sale Proceeds shall be immediately applied as
a mandatory prepayment on the Loans.


 


(d)         Any
Extraordinary Receipts shall be immediately applied as a mandatory prepayment
on the Loans; provided, however, that prepayments under this Section 2.05(d)
shall not be required until the aggregate amount of unapplied Extraordinary
Receipts exceeds $5,000,000.


 


(e)         The
aggregate amount of all prepayments under Section 2.04(c) and (d)
in excess of $20,000,000 shall reduce the Aggregate Commitments by the amount
of such excess.


 


2.06        Termination
or Reduction of Commitments.  The
Borrower may, upon notice to the Administrative Agent, terminate the Aggregate
Commitments, or from time to time permanently reduce the Aggregate Commitments;
provided that (i) any such notice shall be received by the
Administrative Agent not later than 11:00 a.m. five Business Days prior to the
date of termination or reduction, (ii) any such partial reduction shall be in
an aggregate amount of $10,000,000 or any whole multiple of $1,000,000 in
excess thereof, (iii) the Borrower shall not terminate or reduce the Aggregate
Commitments if, after giving effect thereto and to any concurrent prepayments
hereunder, the Total Outstandings would exceed the Aggregate Commitments, and
(iv) if, after giving effect to any reduction of the Aggregate Commitments, the
Letter of Credit Sublimit exceeds the amount of the Aggregate Commitments, such
Sublimit shall be automatically reduced by the amount of such excess.  The Administrative Agent will promptly notify
the Lenders of any such notice of termination or reduction of the Aggregate
Commitments.  Any reduction of the
Aggregate Commitments shall be applied to the Commitment of each Lender
according to its Applicable Percentage. 
All fees accrued until the effective date of any termination of the
Aggregate Commitments shall be paid on the effective date of such termination.


 


2.07        Repayment of Loans.  The
Borrower shall repay to the Lenders on the Maturity Date the aggregate
principal amount of Loans outstanding on such date.


 


2.08        Interest.


 


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


 


(b)         If
any Obligation is not paid when due (without regard to any applicable grace
periods), whether at stated maturity, by acceleration or otherwise, such amount
shall thereafter bear interest at a fluctuating interest rate per annum at all
times equal to the Default Rate to the fullest extent permitted by applicable
Laws.  Accrued and unpaid interest on
past due amounts (including interest on past due interest) shall be due and
payable upon demand.


 


(c)         Interest
on each Loan shall be due and payable in arrears on each Interest Payment Date
applicable thereto and at such other times as may be specified herein.  Interest 


 


36





















 


hereunder shall be due and payable in accordance with the terms hereof
before and after judgment, and before and after the commencement of any
proceeding with respect to the Borrower under any Debtor Relief Law.


 


2.09        Fees.  In addition to certain fees described in
subsections (i) and (j) of Section 2.03:


 


(a)         Commitment
Fee.  The Borrower shall pay to
the Administrative Agent for the account of each Lender in accordance with its
Applicable Percentage, a commitment fee equal to the Applicable Rate times
the actual daily amount by which the Aggregate Commitments exceed the sum of
(i) the Outstanding Amount of Loans and (ii) the Outstanding Amount of L/C
Obligations.  The commitment fee shall
accrue at all times during the Availability Period, including at any time
during which one or more of the conditions in Article IV is not met, and
shall be due and payable quarterly in arrears on the last Business Day of each
March, June, September and December, commencing with the first such date to
occur after the Closing Date, and on the Maturity Date.  The commitment fee shall be calculated
quarterly in arrears, and if there is any change in the Applicable Rate during
any quarter, the actual daily amount shall be computed and multiplied by the
Applicable Rate separately for each period during such quarter that such
Applicable Rate was in effect.


 


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


 


(i)              The
Borrower shall pay to the Lenders such fees as shall have been separately
agreed upon in writing in the amounts and at the times so specified.  Such fees shall be fully earned when paid and
shall not be refundable for any reason whatsoever.


 


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


 


2.11        Evidence of
Debt.


 


(a)         The
Credit Extensions made by each Lender shall be evidenced by one or more
accounts or records maintained by such Lender and by the Administrative Agent
in the ordinary course of business.  The
accounts or records maintained by the Administrative Agent and each Lender
shall be conclusive absent manifest error of the amount of the Credit
Extensions made 


 


37





















 


by the Lenders to the Borrower and the interest and payments
thereon.  Any failure to so record or any
error in doing so shall not, however, limit or otherwise affect the obligation
of the Borrower hereunder to pay any amount owing with respect to the Obligations.  In the event of any conflict between the
accounts and records maintained by any Lender and the accounts and records of
the Administrative Agent in respect of such matters, the accounts and records
of the Administrative Agent shall control in the absence of manifest error.  Upon the request of any Lender made through
the Administrative Agent, the Borrower shall execute and deliver to such Lender
(through the Administrative Agent) a Note, which shall evidence such Lender’s
Loans in addition to such accounts or records. 
Each Lender may attach schedules to its Note and endorse thereon the
date, Type (if applicable), amount and maturity of its Loans and payments with
respect thereto.


 


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


 


2.12        Payments
Generally; Administrative Agent’s
Clawback.


 


(a)         General.  All
payments to be made by the Borrower shall be made without condition or
deduction for any counterclaim, defense, recoupment or setoff.  Except as otherwise expressly provided
herein, all payments by the Borrower hereunder shall be made to the Administrative
Agent, for the account of the respective Lenders to which such payment is owed,
at the Administrative Agent’s Office in Dollars and in immediately available
funds not later than 2:00 p.m. on the date specified herein.  The Administrative Agent will promptly
distribute to each Lender its Applicable Percentage (or other applicable share
as provided herein) of such payment in like funds as received by wire transfer
to such Lender’s Lending Office.  All
payments received by the Administrative Agent after 2:00 p.m. shall be deemed
received on the next succeeding Business Day and any applicable interest or fee
shall continue to accrue.  If any payment
to be made by the Borrower shall come due on a day other than a Business Day,
payment shall be made on the next following Business Day, and such extension of
time shall be reflected in computing interest or fees, as the case may be.


 


(b)                   (i)  Funding
by Lenders; Presumption by Administrative Agent.  Unless the
Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Borrowing of Eurodollar Rate Loans (or, in the case of any
Borrowing of Base Rate Loans, prior to 12:00 noon on the date of such Borrowing)
that such Lender will not make available to the Administrative Agent such
Lender’s share of such Borrowing, the Administrative Agent may assume that such
Lender has made such share available on such date in accordance with Section 2.02
(or, in the case of a Borrowing of Base Rate Loans, that such Lender has made
such share available in accordance with and at the time required by Section 2.02)
and may, in reliance upon such assumption, make available to the Borrower a
corresponding amount.  In such event, if
a Lender has not in fact made its share of the applicable Borrowing available
to the Administrative Agent, then the applicable Lender and the Borrower
severally agree to pay to the Administrative Agent forthwith on demand such
corresponding amount in immediately 


 


38





















 


available funds with interest thereon, for each day from and including
the date such amount is made available to the Borrower to but excluding the
date of payment to the Administrative Agent, at (A) in the case of a payment to
be made by such Lender, the greater of the Federal Funds Rate and a rate
determined by the Administrative Agent in accordance with banking industry
rules on interbank compensation and (B) in the case of a payment to be made by
the Borrower, the interest rate applicable to Base Rate Loans.  If the Borrower and such Lender shall pay
such interest to the Administrative Agent for the same or an overlapping
period, the Administrative Agent shall promptly remit to the Borrower the
amount of such interest paid by the Borrower for such period.  If such Lender pays its share of the
applicable Borrowing to the Administrative Agent, then the amount so paid shall
constitute such Lender’s Loan included in such Borrowing.  Any payment by the Borrower shall be without
prejudice to any claim the Borrower may have against a Lender that shall have
failed to make such payment to the Administrative Agent.


 


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


 


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


 


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


 


(d)                   Obligations of
Lenders Several.  The obligations of the Lenders hereunder to
make Loans, to fund participations in Letters of Credit and to make payments
pursuant to Section 10.04(c) are several and not joint.  The failure of any Lender to make any Loan,
to fund any such participation or to make any payment under Section 10.04(c)
on any date required hereunder shall not relieve any other Lender of its
corresponding obligation to do so on such 


 


39





















 


date, and no Lender shall be responsible for the failure of any other
Lender to so make its Loan, to purchase its participation or to make its
payment under Section 10.04(c).


 


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


 


2.13        Sharing of Payments by Lenders.  If any Lender shall, by
exercising any right of setoff or counterclaim or otherwise, obtain payment in
respect of any principal of or interest on any of the Loans made by it, or the
participations in L/C Obligations held by it resulting in such Lender’s
receiving payment of a proportion of the aggregate amount of such Loans or
participations and accrued interest thereon greater than its pro  rata
share thereof as provided herein, then the Lender receiving such greater
proportion shall (a) notify the Administrative Agent of such fact, and (b)
purchase (for cash at face value) participations in the Loans and
subparticipations in L/C Obligations of the other Lenders, or make such other
adjustments as shall be equitable, so that the benefit of all such payments
shall be shared by the Lenders ratably in accordance with the aggregate amount
of principal of and accrued interest on their respective Loans and other
amounts owing them, provided that:


 


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


 


(b)         the
provisions of this Section shall not be construed to apply to (x) any payment
made by the Borrower pursuant to and in accordance with the express terms of
this Agreement or (y) any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or subparticipations
in L/C Obligations to any assignee or participant, other than to the Borrower
or any Restricted Subsidiary thereof (as to which the provisions of this
Section shall apply).


 


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


 


2.14        Increase in Commitments.


 


(a)         Request
for Increase.  Provided there exists no Default, upon notice to
the Administrative Agent (which shall promptly notify the Lenders), the
Borrower may from time to time, request an increase in the Aggregate
Commitments by an amount (for all such requests) not exceeding $50,000,000; provided
that (i) any such request for an increase shall be in a minimum amount of
$5,000,000, and (ii) the Borrower may make a maximum of three such requests.  At the time of sending such notice, the
Borrower (in consultation with the Administrative Agent) shall specify the time
period within which each Lender is requested to 


 


40





















 


respond (which shall in no event be less than ten Business Days from
the date of delivery of such notice to the Lenders).


 


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


 


(c)         Notification
by Administrative Agent; Additional Lenders.  The Administrative
Agent shall notify the Borrower and each Lender of the Lenders’ responses to
each request made hereunder.  To achieve
the full amount of a requested increase and subject to the approval of the
Administrative Agent and the L/C Issuer (which approvals shall not be
unreasonably withheld), the Borrower may also invite additional Eligible
Assignees to become Lenders pursuant to a joinder agreement in form and
substance reasonably satisfactory to the Administrative Agent and its counsel.


 


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


 


(e)         Conditions
to Effectiveness of Increase.  As a condition precedent to such
increase, the Borrower shall deliver to the Administrative Agent a certificate
of the Borrower dated as of the Increase Effective Date (in sufficient copies
for each Lender) signed by a Responsible Officer of the Borrower (i) certifying
and attaching the resolutions adopted by the Borrower approving or consenting
to such increase (and certifying that each other Loan Party has approved or
consented to such increase, attaching copies of any resolutions adopted by such
Loan Parties not previously delivered to the Administrative Agent evidencing
such approval or consent), and (ii) certifying that, before and after giving
effect to such increase, (A) the representations and warranties contained in Article
V and the other Loan Documents are true and correct in all material
respects on and as of the Increase Effective Date, except to the extent that
such representations and warranties specifically refer to an earlier date, in
which case they are true and correct in all material respects as of such
earlier date, and except that for purposes of this Section 2.14,
the representations and warranties contained in subsections (a) and (b) of Section 5.05
shall be deemed to refer to the most recent statements furnished pursuant to
clauses (a) and (b), respectively, of Section 6.01, (B) no Default
exists, and (C) the financial covenants contained in Section 7.21 are
satisfied on a pro forma basis after giving
effect to any incremental Borrowing associated with such increase and for the
most recent determination period.  The
Borrower shall prepay any Loans outstanding on the Increase Effective Date (and
pay any additional amounts required pursuant to Section 3.05) to
the extent necessary to keep the outstanding Loans ratable with any revised
Applicable Percentages arising from any nonratable increase in the Commitments
under this Section.


 


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


 


41





















 


ARTICLE III.

TAXES, YIELD PROTECTION AND
ILLEGALITY


 


3.01        Taxes.


 


(a)         Payments
Free of Taxes.  Any and all payments by or on account of any
obligation of the Borrower hereunder or under any other Loan Document shall be
made free and clear of and without reduction or withholding for any Indemnified
Taxes or Other Taxes, provided that if the Borrower shall be required by
applicable Law to deduct any Indemnified Taxes (including any Other Taxes) from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent, Lender or
L/C Issuer, as the case may be, receives an amount equal to the sum it would
have received had no such deductions been made, (ii) the Borrower shall make
such deductions and (iii) the Borrower shall timely pay the full amount
deducted to the relevant Governmental Authority in accordance with applicable Law.


 


(b)         Payment
of Other Taxes by the Borrower.  Without limiting the provisions
of subsection (a) above, the Borrower shall timely pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable Law.


 


(c)         Indemnification
by the Borrower.  The Borrower shall indemnify the Administrative
Agent, each Lender and the L/C Issuer, within 10 days after demand therefor,
for the full amount of any Indemnified Taxes or Other Taxes (including
Indemnified Taxes or Other Taxes imposed or asserted on or attributable to
amounts payable under this Section) paid by the Administrative Agent, such
Lender or the L/C Issuer, as the case may be, and any penalties, interest and
reasonable expenses arising therefrom or with respect thereto, whether or not
such Indemnified Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority.  A certificate as to the amount of such
payment or liability delivered to the Borrower by a Lender or the L/C Issuer (with
a copy to the Administrative Agent), or by the Administrative Agent on its own
behalf or on behalf of a Lender or the L/C Issuer, shall be conclusive absent
manifest error.


 


(d)         Evidence
of Payments.  As soon as practicable after any payment of Indemnified
Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower
shall deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy
of the return reporting such payment or other evidence of such payment
reasonably satisfactory to the Administrative Agent.


 


(e)         Status
of Lenders.  Each Foreign Lender that is entitled to an exemption
from or reduction of withholding tax under the Law of the jurisdiction in which
the Borrower is resident for tax purposes, or any treaty to which such
jurisdiction is a party, with respect to payments hereunder or under any other
Loan Document shall deliver to the Borrower (with a copy to the Administrative
Agent), at the time or times prescribed by applicable Law or reasonably
requested by the Borrower or the Administrative Agent, such properly completed
and executed documentation prescribed by applicable Law as will permit such
payments to be made without withholding or at a reduced rate of
withholding.  In addition, any Lender, if
requested by the 


 


42





















 


Borrower or the Administrative Agent, shall
deliver such other documentation prescribed by applicable Law or reasonably requested
by the Borrower or the Administrative Agent as will enable the Borrower or the
Administrative Agent to determine whether or not such Lender is subject to
backup withholding or information reporting requirements.


 


Without limiting the generality of the
foregoing, in the event that the Borrower is resident for tax purposes in the
United States, each Foreign Lender shall deliver to the Borrower and the
Administrative Agent (in such number of copies as shall be requested by the
recipient) on or prior to the date on which such Foreign Lender becomes a
Lender under this Agreement (and from time to time thereafter upon the request
of the Borrower or the Administrative Agent, but only if such Foreign Lender is
legally entitled to do so), whichever of the following is applicable:


 


(i)              duly
completed copies of Internal Revenue Service Form W-8BEN claiming eligibility
for benefits of an income tax treaty to which the United States is a party,


 


(ii)             duly
completed copies of Internal Revenue Service Form W-8ECI,


 


(iii)            in
the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under section 881(c) of the Code, (x) a certificate to the
effect that such Foreign Lender is not (A) a “bank” within the meaning of
section 881(c)(3)(A) of the Code, (B) a holder of ten percent (10%) or more of
the capital or profits interests of the Borrower within the meaning of section
871(h)(3)(B) of the Code, or (C) a “controlled foreign corporation” described
in section 881(c)(3)(C) of the Code and (y) duly completed copies of  Internal Revenue Service Form W-8BEN, or


 


(iv)            any
other form prescribed by applicable Law as a basis for claiming exemption from
or a reduction in United States Federal withholding tax duly completed together
with such supplementary documentation as may be prescribed by applicable Law to
permit the Borrower to determine the withholding or deduction required to be
made.


 


(f)          United
States Lenders.  Upon request of the
Borrower or the Administrative Agent, a Lender that is a United States person
within the meaning of Section 7701(a)(30) of the Code shall deliver to such
requesting party (in such number of copies as shall be requested thereby) duly
completed copies of Internal Revenue Service Form W-9, or any successor or
other applicable form.


 


(g)         Treatment
of Certain Refunds.  If the Administrative Agent, any Lender or
the L/C Issuer determines, in its sole discretion, that it has received a
refund of any Taxes or Other Taxes as to which it has been indemnified by the
Borrower or with respect to which the Borrower has paid additional amounts
pursuant to this Section, it shall pay to the Borrower an amount equal to such
refund (but only to the extent of indemnity payments made, or additional
amounts paid, by the Borrower under this Section with respect to the Taxes or
Other Taxes giving rise to such refund), net of all out-of-pocket expenses of
the Administrative Agent, such Lender or the L/C Issuer, as the case may be,
and without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund), provided that the Borrower, upon
the request of the Administrative Agent, such Lender or the L/C Issuer, agrees 


 


43





















 


to repay the amount paid over to the Borrower (plus any penalties,
interest or other charges imposed by the relevant Governmental Authority) to
the Administrative Agent, such Lender or the L/C Issuer in the event the
Administrative Agent, such Lender or the L/C Issuer is required to repay such
refund to such Governmental Authority. 
This subsection shall not be construed to require the Administrative
Agent, any Lender or the L/C Issuer to make available its tax returns (or any
other information relating to its taxes that it deems confidential) to the
Borrower or any other Person.


 


3.02        Illegality.  If any Lender determines that any Change in Law
has made it unlawful, or that any Governmental Authority has asserted that it
is unlawful, for any Lender or its applicable Lending Office to make, maintain
or fund Eurodollar Rate Loans, or to determine or charge interest rates based
upon the Eurodollar Rate, or any Governmental Authority has imposed material
restrictions on the authority of such Lender to purchase or sell, or to take
deposits of, Dollars in the London interbank market, then, on notice thereof by
such Lender to the Borrower through the Administrative Agent, any obligation of
such Lender to make or continue Eurodollar Rate Loans or to convert Base Rate
Loans to Eurodollar Rate Loans shall be suspended until such Lender notifies
the Administrative Agent and the Borrower that the circumstances giving rise to
such determination no longer exist.  Upon
receipt of such notice, the Borrower shall, upon demand from such Lender (with
a copy to the Administrative Agent), prepay or, if applicable, convert all
Eurodollar Rate Loans of such Lender to Base Rate Loans, either on the last day
of the Interest Period therefor, if such Lender may lawfully continue to
maintain such Eurodollar Rate Loans to such day, or immediately, if such Lender
may not lawfully continue to maintain such Eurodollar Rate Loans.  Upon any such prepayment or conversion, the
Borrower shall also pay accrued interest on the amount so prepaid or converted.


 


3.03        Inability to Determine Rates.  If
the Required Lenders determine that for any reason in connection with any
request for a Eurodollar Rate Loan or a conversion to or continuation thereof
that (a) Dollar deposits are not being offered to banks in the London
interbank eurodollar market for the applicable amount and Interest Period of
such Eurodollar Rate Loan, (b) adequate and reasonable means do not exist
for determining the Eurodollar Rate
for any requested Interest Period with respect to a proposed Eurodollar Rate
Loan , or (c) the Eurodollar Rate
for any requested Interest Period with respect to a proposed Eurodollar Rate
Loan does not adequately and fairly reflect the cost to such Lenders of funding
such Loan, the Administrative Agent will promptly so notify the Borrower and
each Lender.  Thereafter, the obligation
of the Lenders to make or maintain Eurodollar Rate Loans shall be suspended
until the Administrative Agent (upon the instruction of the Required Lenders)
revokes such notice.  Upon receipt of
such notice, the Borrower may revoke any pending request for a Borrowing of,
conversion to or continuation of Eurodollar Rate Loans or, failing that, will
be deemed to have converted such request into a request for a Borrowing of Base
Rate Loans in the amount specified therein.


 


3.04        Increased
Costs; Reserves on Eurodollar Rate Loans.


 


(a)         Increased
Costs Generally.  If any Change in
Law shall:


 


(i)              impose,
modify or deem applicable any reserve, special deposit, compulsory loan,
insurance charge or similar requirement against assets of, deposits with 


 


44





















 


or for the account of, or credit extended or participated in by, any
Lender (except any reserve requirement contemplated
by Section 3.04(e)) or the L/C Issuer;


 


(ii)             subject
any Lender or the L/C Issuer to any tax of any kind whatsoever with respect to
this Agreement, any Letter of Credit, any participation in a Letter of Credit
or any Eurodollar Rate Loan made by it, or change the basis of taxation of
payments to such Lender or the L/C Issuer in respect thereof (except for
Indemnified Taxes or Other Taxes covered by Section 3.01 and the
imposition of, or any change in the rate of, any Excluded Tax payable by such
Lender or the L/C Issuer); or


 


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


 


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


 


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


 


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


 


45





















 


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


 


(e)         Reserves
on Eurodollar Rate Loans.  The
Borrower shall pay to each Lender, as long as such Lender shall be required to
maintain reserves with respect to liabilities or assets consisting of or
including Eurocurrency funds or deposits (currently known as “Eurocurrency
liabilities”), additional interest on the unpaid principal amount of each
Eurodollar Rate Loan equal to the actual costs of such reserves allocated to
such Loan by such Lender (as determined by such Lender in good faith, which
determination shall be conclusive absent manifest error), which shall be due
and payable on each date on which interest is payable on such Loan, provided
the Borrower shall have received at least 10 days’ prior notice (with a copy to
the Administrative Agent) of such additional interest from such Lender.  If a Lender fails to give notice 10 days
prior to the relevant Interest Payment Date, such additional interest shall be
due and payable 10 days from receipt of such notice.


 


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


 


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


 


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


 


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


 


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


 


For purposes of calculating amounts payable by the Borrower to the Lenders
under this Section 3.05, each Lender shall be deemed to have funded
each Eurodollar Rate Loan made by it at the Eurodollar Rate for such Loan by a
matching deposit or other borrowing in the London 


 


46





















 


interbank eurodollar market for a comparable amount and for a
comparable period, whether or not such Eurodollar Rate Loan was in fact so
funded.


 


3.06        Mitigation
Obligations; Replacement of Lenders.


 


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


 


(b)         Replacement
of Lenders.  If any Lender requests compensation under Section 3.04,
or if the Borrower is required to pay any additional amount to any Lender or
any Governmental Authority for the account of any Lender pursuant to Section 3.01
or if any Lender gives a notice pursuant to Section 3.02, the Borrower
may replace such Lender in accordance with Section 10.13.


 


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


 


ARTICLE IV.

CONDITIONS PRECEDENT TO CREDIT
EXTENSIONS


 


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


 


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


 


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


 


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


 


47





















 


(iii)            each
Security Document listed in the Security Schedule;


 


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


 


(v)             such
documents and certifications as the Administrative Agent may reasonably require
to evidence that each Loan Party is duly organized or formed, and that each of
the Borrower and each Guarantor is validly existing, in good standing and
qualified to engage in business in each jurisdiction required by Section
5.01;


 


(vi)            favorable
opinions of Vinson & Elkins LLP, counsel to the Loan Parties, addressed to
the Administrative Agent and each Lender, as to the matters set forth in Exhibit H
and such other matters concerning the Loan Parties and the Loan Documents as
the Required Lenders may reasonably request, and favorable opinions of
Dubberstein Heinen & Morris PC, special Oklahoma counsel to the
Administrative Agent, addressed to the Administrative Agent and each Lender;


 


(vii)           a
certificate of a Responsible Officer of the Borrower either (A) attaching
copies of all consents, licenses and approvals required in connection with the
execution, delivery and performance by any Loan Party and the validity against any
such Loan Party of the Loan Documents to which it is a party, and such
consents, licenses and approvals shall be in full force and effect, or (B)
stating that no such consents, licenses or approvals are so required;


 


(viii)          the
Initial Financial Statements;


 


(ix)            a
certificate signed by a Responsible Officer of the Borrower certifying (A) that
the conditions specified in Sections 4.02(a) and (b) have
been satisfied; (B) that there has been no event or circumstance since the
date of the Audited Financial Statements that has had or could be reasonably
expected to have, either individually or in the aggregate, a Material Adverse
Effect; (C) that, after giving effect to the Credit Extension requested on
the Closing Date, the Aggregate Commitments will exceed the Total Outstandings
by an amount of at least equal to $75,000,000; and (D) that contemporaneously
with the making of such Credit Extension, the Borrower shall receive gross
proceeds of at least $170,000,000 from loans made pursuant to the Senior Bridge
Facility.


 


(x)            evidence that all insurance required to be maintained
pursuant to the Loan Documents has been obtained and is in effect;


 


(xi)            documents,
in form and substance reasonably satisfactory to Administrative Agent, assigning
the Indebtedness and Liens under the Comerica Credit Facility and the ScissorTail
Credit Facility to the Administrative Agent on the Closing Date and confirming
the termination of such credit facilities;


 


48





















 


(xii)           a
report summarizing all Hedging Contracts entered into by the Borrower or any
Restricted Subsidiary and in effect as of the Closing Date, which Hedging
Contracts shall be sufficient to mitigate Borrower’s and Restricted
Subsidiaries’ commodity price risk as of the Closing Date as determined by Administrative
Agent;


 


(xiii)          a
certificate from a Responsible Officer of the Borrower, in substantially the
form of Exhibit I hereto, attesting to the Solvency of each Loan Party
before and after giving effect to the transactions contemplated by this
Agreement and the Acquisition Documents;


 


(xiv)          a
certificate from a Responsible Officer of the Borrower (A) attaching forecasts,
in form reasonably satisfactory to the Administrative Agent, of income statements
for the fiscal quarter ending December 31, 2005 and for each year commencing
with the first fiscal year of the Borrower following the Closing Date through
the Maturity Date, (B) certifying that (1) the pro forma Consolidated EBITDA
(calculated giving pro forma effect to the Acquisition) for the twelve months
ended March 31, 2005 was not less than $72,000,000, (2) the pro forma
Consolidated Total Leverage Ratio (calculated giving pro forma effect to the
Acquisition) for the twelve months ended March 31, 2005 was not greater than
5.9 to 1.0, and (3) such pro forma financial statements and forecasts were
prepared in good faith on the basis of assumptions that were fair in light of
then existing conditions (subject to the proviso that it is understood that such
pro forma financial statements and forecasts are necessarily based upon
professional opinions, estimates and projections and that the Borrower does not
warrant that such opinions, estimates and projections will ultimately prove to
have been accurate), and (C) certifying (prior to giving effect to the
Acquisition) as to matters that would be required by Section 302 of
Sarbanes-Oxley.


 


(xv)           a
copy of each Acquisition Document, together with a certificate from the
Responsible Officer of the Borrower certifying that (A) such copies are
accurate and complete and represent the complete understanding and agreement of
the parties thereto, (B) no material right or obligation of any party thereto
has been modified, amended or waived, except as otherwise disclosed in such
certificate, (C) the Borrower has obtained all approvals (if any) required
pursuant to the Hart-Scott-Rodino Antitrust Improvement Act of 1976, as
amended, or the waiting period with respect thereto has expired, and (D)
subject only to the contemporaneous funding of the initial Borrowing to be made
hereunder and the Senior Bridge Facility (all of which conditions precedent
with respect to the Senior Bridge Facility having been satisfied or waived),
the Acquisition has been consummated on the terms set forth in such Acquisition
Documents; and


 


(xvi)          such
other assurances, certificates, documents, consents or opinions as the
Administrative Agent, the L/C Issuer, or the Required Lenders reasonably may
require.


 


(b)         The
Acquisition shall have been contemporaneously completed pursuant to the terms
of the Acquisition Documents, and as a result thereof, the Acquisition
Subsidiary shall have directly or indirectly acquired good title to all of the
Equity Interests contemplated to be transferred by the Acquisition Documents,
free and clear of all liens except Liens permitted under Section 7.01.


 


49





















 


(c)         The
Senior Bridge Facility shall have been contemporaneously consummated upon terms
and conditions satisfactory to the Administrative Agent.


 


(d)         Any
fees required to be paid by the Borrower to the Administrative Agent and the
Lenders on or before the Closing Date shall have been paid.


 


Without limiting the generality of the
provisions of Section 9.04, for purposes of determining compliance
with the conditions specified in this Section 4.01, each Lender
that has signed this Agreement shall be deemed to have consented to, approved
or accepted or to be satisfied with, each document or other matter required
thereunder to be consented to or approved by or acceptable or satisfactory to a
Lender unless the Administrative Agent shall have received notice from such
Lender prior to the proposed Closing Date specifying its objection thereto.


 


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


 


(a)         The
representations and warranties of the Borrower and each other Loan Party
contained in Article V or any other Loan Document shall be true and
correct in all material respects on and as of the date of such Credit
Extension, except to the extent that such representations and warranties
specifically refer to an earlier date, in which case they shall be true and
correct as of such earlier date, and except that for purposes of this Section 4.02,
the representations and warranties contained in subsections (a) and (b) of Section 5.05
shall be deemed to refer to the most recent statements furnished pursuant to
clauses (a) and (b), respectively, of Section 6.01.


 


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


 


(c)         No
Material Adverse Effect shall have occurred, and no event or circumstance shall
have occurred that could reasonably be expected to cause a Material Adverse
Effect, relating to the consolidated financial condition or business of the
Loan Parties since the date of the date of the most recent financial statements
delivered pursuant to Section 4.01(a)(viii) or Section 6.01, as
applicable.


 


(d)         Each
Loan Party shall be Solvent.


 


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


 


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


 


50





















 


ARTICLE V.

REPRESENTATIONS AND WARRANTIES


 


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


 


5.01        Existence, Qualification and Power; Compliance with Laws.  Each
Loan Party (a) is duly organized or formed, validly existing and in good
standing under the Laws of the jurisdiction of its incorporation or
organization, (b) has all requisite power and authority and all requisite
governmental licenses, authorizations, consents and approvals to (i) own or
lease its assets and carry on its business and (ii) execute, deliver and
perform its obligations under the Loan Documents to which it is a party, (c) is
duly qualified and is licensed and in good standing under the Laws of each
jurisdiction where its ownership, lease or operation of properties or the
conduct of its business requires such qualification or license, and (d) is in
compliance with all Laws applicable to it; except in each case referred to in
clause (b)(i), (c) or (d), to the extent that failure to do so could not
reasonably be expected to have a Material Adverse Effect.


 


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


 


5.03        Governmental
Authorization; Other Consents.  No
approval, consent, exemption, authorization, or other action by, or notice to,
or filing with, any Governmental Authority or any other Person is necessary or
required in connection with the execution, delivery or performance by, or
enforcement against, any Loan Party of this Agreement or any other Loan
Document or any Acquisition Document, except for the recordings and filings
required by the Security Documents.


 


5.04        Binding Effect.  This Agreement has been, and each other
Loan Document, when delivered hereunder, will have been, duly executed and
delivered by each Loan Party that is party thereto.  This Agreement constitutes, and each other
Loan Document when so delivered will constitute, a legal, valid and binding
obligation of such Loan Party, enforceable against each Loan Party that is
party thereto in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other Laws affecting creditors’
rights generally and subject to general principles of equity, regardless of
whether considered in a proceeding in equity or at Law.


 


5.05        Financial
Statements; No Material Adverse
Effect; No Internal Control Event.


 


51





















 


(a)         The
Audited Financial Statements (i) were prepared in accordance with GAAP
consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein; (ii) fairly present in all material respects the
financial condition of the Borrower and its Subsidiaries as of the date thereof
and their results of operations for the period covered thereby in accordance
with GAAP consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein; and (iii) show all material indebtedness and
other liabilities, direct or contingent, of the Borrower and its Subsidiaries
as of the date thereof, including liabilities for taxes and Indebtedness.


 


(b)         The
unaudited consolidated balance sheets of the Borrower and its Subsidiaries
dated March 31, 2005, and the related consolidated statements of income or
operations, members’ capital and cash flows for the fiscal quarter ended on
that date (i) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly noted
therein, and (ii) fairly present in all material respects the financial
condition of the Borrower and its Subsidiaries as of the date thereof and their
results of operations for the period covered thereby, subject, in the case of
clauses (i) and (ii), to the absence of footnotes and to normal year-end audit
adjustments.  Schedule 5.05 sets
forth all material indebtedness and other liabilities, direct or contingent, of
the Borrower and its consolidated Subsidiaries as of the date hereof, including
liabilities for taxes and Indebtedness, not disclosed in the Initial Financial
Statements.


 


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


 


(d)         Since
the date of the Audited Financial Statements, no Internal Control Event has
occurred.


 


(e)         The
consolidated pro forma balance sheet of the Borrower and its Restricted Subsidiaries
as at March 31, 2005 (taking into account the Acquisition), and the related consolidated
pro forma statements of income of the Borrower and its Restricted Subsidiaries
for the period covered thereby, certified by the chief financial officer of the
Borrower, copies of which have been furnished to each Lender, fairly present in
all material respects the consolidated pro forma financial condition of the
Borrower and its Restricted Subsidiaries (after giving effect to the
Acquisition) as at such date and the consolidated pro forma results of
operations of the Borrower and its Restricted Subsidiaries for the period ended
on such date, all in accordance with GAAP.


 


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


 


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


 


5.08        Ownership of Property; Liens.  Each of the Borrower and each
Restricted Subsidiary has good record and marketable title to, or valid
leasehold interests in, all real property necessary or used in the ordinary
conduct of its business, except for such defects in title as could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.  The property of the
Borrower and its Restricted Subsidiaries is subject to no Liens, other than
Liens permitted by Section 7.01.


 


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


 


5.10        Insurance.  The properties of the Borrower and its Restricted
Subsidiaries are insured with financially sound and reputable insurance
companies not Affiliates of the Borrower, in such amounts, with such
deductibles and covering such risks as are customarily carried by companies
engaged in similar businesses and owning similar properties in localities where
the Borrower or the applicable Restricted Subsidiary operates.


 


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


 


5.12        ERISA
Compliance.


 


(a)         Each
Plan is in compliance in all material respects with the applicable provisions
of ERISA, the Code and other Federal or state Laws.  Each Plan that is intended to qualify under
Section 401(a) of the Code has received a favorable determination letter from
the IRS or an application for such a letter is currently being processed by the
IRS with respect thereto and, to the best knowledge of the Borrower, nothing
has occurred which would prevent, or cause the loss of, such
qualification.  The Borrower and each
ERISA Affiliate have made all required contributions to each Plan subject to
Section 412 of the Code, and no application for a funding waiver or an
extension of any amortization period pursuant to Section 412 of the Code has
been made with respect to any Plan.


 


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


 


(c)         (i)  No
ERISA Event has occurred or is reasonably expected to occur; (ii) no Pension
Plan has any Unfunded Pension Liability; (iii) neither the Borrower nor any
ERISA Affiliate has incurred, or reasonably expects to incur, any liability
under Title IV of ERISA with respect to any Pension Plan (other than premiums
due and not delinquent under Section 4007 of ERISA); (iv) neither the Borrower
nor any ERISA Affiliate has incurred, or reasonably expects to incur, any
liability (and no event has occurred which, with the giving of notice under
Section 4219 of ERISA, would result in such liability) under Sections 4201 or
4243 of ERISA with respect to a Multiemployer Plan; and (v) neither the
Borrower nor any ERISA Affiliate has engaged in a transaction that could be
subject to Sections 4069 or 4212(c) of ERISA.


 


5.13        Subsidiaries; Equity Interests.  The
Borrower has no Subsidiaries other than those specifically disclosed in Part
(a) of Schedule 5.13, and all of the outstanding Equity Interests in
such Subsidiaries have been issued and are owned by a Loan Party in the amounts
specified on Part (a) of Schedule 5.13 free and clear of all Liens other
than Liens permitted under Section 7.01. 
The Borrower has no equity investments in any other corporation or
entity other than those specifically disclosed in Part (b) of Schedule
5.13.  Schedule 5.13
identifies each Subsidiary as either Restricted or Unrestricted, its state of
organization, and its organizational identification number, and each Restricted
Subsidiary on such schedule is a wholly-owned Subsidiary.


 


5.14        Margin
Regulations; Investment Company Act; Public Utility Holding Company Act.


 


(a)         The
Borrower is not engaged and will not engage, principally or as one of its
important activities, in the business of purchasing or carrying margin stock
(within the meaning of Regulation U issued by the FRB), or extending credit for
the purpose of purchasing or carrying margin stock.


 


(b)         None
of the Borrower, any Person Controlling the Borrower, or any Subsidiary (i) 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,”
within the meaning of the Public Utility Holding Company Act of 1935, or (ii)
is or is required to be registered as an “investment company” under the Investment
Company Act of 1940.


 


5.15        Disclosure.  The Borrower has disclosed to the
Administrative Agent and the Lenders all agreements, instruments and corporate
or other restrictions to which it or any of its Restricted Subsidiaries is
subject, and all other matters known to it, that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse
Effect.  No report, financial statement,
certificate or other written information furnished by or on behalf of any Loan
Party to the Administrative Agent or any Lender in connection with the
transactions contemplated hereby and the negotiation of this Agreement or
delivered hereunder or under any 


 


54





















 


other Loan Document (in each case, as modified or supplemented by other
information so furnished) contains any misstatement of fact or omits to state
any fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not materially misleading with
respect to the Borrower and its Restricted Subsidiaries and their operations,
business and properties, taken as a whole; provided that, with respect
to projected financial information, the Borrower represents only that such
information was prepared in good faith based upon assumptions believed to be
reasonable at the time.


 


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


 


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


 


5.18        Labor
Disputes and Acts of God. 
Neither the business nor the properties of any Loan Party has been
affected by any fire, explosion, accident, strike, lockout or other labor
dispute, drought, storm, hail, earthquake, embargo, act of God or of the public
enemy or other casualty (whether or not covered by insurance), which could
reasonably be expected to have a Material Adverse Effect.


 


5.19        Solvency.  Upon giving effect
to the execution of this Agreement and the other Loan Documents by the Borrower
and each Guarantor that is a party thereto, the consummation of the
transactions contemplated hereby and thereby, the consummation of the Senior
Bridge Facility and the consummation of the Acquisition, the Borrower and each
Guarantor will be Solvent.


 


5.20        Acquisition Closing.


 


(a)           After
giving effect to the Acquisition, all representations and warranties made by
any Loan Party in any Loan Document will be true and correct in all material respects
on and as of the Closing Date.


 


55























 


(b)                               On the Closing Date, each
of the representations and warranties made by any party in the Acquisition
Documents is true and correct in all material respects, other than with respect
to those matters of which a Responsible Officer has obtained knowledge thereof
following the Closing Date, which the Borrower reasonably believes do not result
in an aggregate diminution in value of the assets and properties acquired
pursuant to the Acquisition in an amount in excess of escrowed funds under the
Acquisition Agreement that will be disbursed to the Borrower as a result
thereof; and none of such parties has failed to perform any material obligation
or covenant required by the Acquisition Documents to be performed or complied
with by it on or before the Closing Date. 
Simultaneously with the making of the Loans on the Closing Date, the Acquisition
will have been consummated in compliance with the material terms and conditions
of the Acquisition Documents and all conditions precedent to such consummation
will be fully satisfied or waived.


 


ARTICLE VI.
AFFIRMATIVE
COVENANTS


 


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


 


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


 


(a)                           as soon as available, but in
any event within 90 days after the end of each fiscal year of the Borrower, a
consolidated balance sheet of the Borrower and its Subsidiaries (with consolidating
balance sheets breaking out (i) the Borrower and its Subsidiaries, excluding (x)
ScissorTail and its Subsidiaries (if any) and (y) any Unrestricted Subsidiaries
described in clause (iii) below, (ii) ScissorTail and its Subsidiaries (if
any), and (iii) to the extent included in such consolidated balance sheet, Unrestricted
Subsidiaries with aggregate assets in excess of $1,000,000), as at the end of
such fiscal year, and the related consolidated and consolidating statements of income or operations and members’
capital (or other form of owners’ equity) and consolidated cash flows for such
fiscal year, setting forth in each case in comparative form the figures for the
previous fiscal year, all in reasonable detail and prepared in accordance with
GAAP, such consolidated statements to
be audited and accompanied by (i) a report and opinion of a Registered
Public Accounting Firm of nationally recognized standing reasonably acceptable
to the Required Lenders, which report and opinion shall be prepared in accordance
with generally accepted auditing standards and applicable Securities Laws and shall
not be subject to any “going concern” or like qualification or exception or any
qualification or exception as to the scope of such audit and (ii) an
attestation report of such Registered Public Accounting Firm as to the Borrower’s
internal controls pursuant to Section 404 of Sarbanes-Oxley that does not identify
any material weaknesses or scope limitations, other than (1) scope limitations
related to acquisitions by the Borrower or the Restricted Subsidiaries that are
effected during the period covered by the attestation report or (2) material
weaknesses or scope limitations to which the Required Lenders do not object; and such consolidating statements to be
certified by a Responsible Officer of the Borrower to the effect that such
statements are fairly 


 


56





















 


stated in all material respects when
considered in relation to the consolidated financial statements of the Borrower
and its Subsidiaries; and


 


(b)                           as
soon as available, but in any event within 45 days (or, with respect to the
fiscal quarter ending September 30, 2005, 60 days) after the end of each of the
first three fiscal quarters of each fiscal year of the Borrower (commencing with the fiscal quarter ended September
30, 2005), a consolidated balance sheet of the Borrower and its
Subsidiaries (with consolidating balance sheets breaking out (i) the Borrower
and its Subsidiaries, excluding (x) ScissorTail and its Subsidiaries (if any) and
(y) any Unrestricted Subsidiaries described in clause (iii) below, (ii) ScissorTail
and its Subsidiaries (if any) and (iii) to the extent included in such
consolidated balance sheet, Unrestricted Subsidiaries with aggregate assets in
excess of $1,000,000), as at the end of such fiscal quarter, and the related
consolidated and consolidating
statements of income or operations and members’ capital (or other form of
owners’ equity) and consolidated cash flows for such fiscal quarter and for the
portion of the Borrower’s fiscal year then ended, setting forth in each case in
comparative form the figures for the corresponding fiscal quarter of the
previous fiscal year and the corresponding portion of the previous fiscal year,
all in reasonable detail, such
consolidated statements to be certified by a Responsible Officer of the
Borrower as fairly presenting in all material respects the financial condition,
results of operations, members’ capital (or other owners’ equity) and cash
flows of the Borrower and its Subsidiaries in accordance with GAAP, subject
only to normal year-end audit adjustments and the absence of footnotes and such consolidating statements to be
certified by a Responsible Officer of the Borrower to the effect that such
statements are fairly stated in all material respects when considered in
relation to the consolidated financial statements of the Borrower and its
Subsidiaries.


 


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


 


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


 


(a)                           concurrently with the
delivery of the financial statements referred to in Section 6.01(a),
the audit report and opinion referred to therein;


 


(b)                           concurrently with the
delivery of the financial statements referred to in Sections 6.01(a)
and (b),
a duly completed Compliance Certificate signed by a Responsible Officer of the
Borrower;


 


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


 


57





















 


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


 


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


 


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


 


(g)                            promptly upon the
occurrence thereof, notice of any acquisition or divestiture by the Borrower or
any of its Restricted Subsidiaries of any assets or properties in excess of
$5,000,000;


 


(h)                           promptly upon its becoming
available, copies of all notices or documents received by the Borrower or any
other Loan Party pursuant to any Material Contract alleging a material default
or nonperformance by such Person thereunder or terminating or suspending any
such Material Contract;


 


(i)                               as soon as available,
and in any event within 60 days after the end of each fiscal year, a financial
plan for the Borrower (in form reasonably satisfactory to the Administrative
Agent), prepared or caused to be prepared by a Responsible Officer of the
Borrower, setting forth for the then calendar year and financial projections
for the Borrower;


 


(j)                              concurrently with the
annual renewal of the Loan Parties’ insurance policies, if requested by the
Administrative Agent, a certificate of insurance showing all insurance required
to be maintained pursuant to the Loan Documents has been obtained and is in
effect; and


 


(k)                           promptly, such additional
information regarding the business, financial or corporate affairs of the
Borrower or any Subsidiary, or compliance with the terms of the Loan Documents,
as the Administrative Agent or any Lender may from time to time reasonably
request.


 


Documents required to be delivered pursuant
to Section 6.01(a) or (b) or Section 6.02(d) may
be delivered electronically and if so delivered, shall be deemed to have been
delivered on the date (i) on which the Borrower posts such documents, or
provides a link thereto on the Borrower’s website on the Internet at the
website address listed on Schedule 10.02, or (ii) on which such
documents are posted on the Borrower’s behalf on an Internet or intranet
website, if any, to which each Lender and the Administrative Agent have access
(whether a commercial, third-party website or whether sponsored by the
Administrative Agent); or (iii) on which Borrower provides to the
Administrative Agent by electronic mail electronic versions (i.e., soft 


 


58





















 


copies) of such documents (delivery of the
Compliance Certificates required to be delivered pursuant to Section 6.02(d)
also being deemed delivered on such date if included within such electronic
mail under this clause (iii)); provided, the Borrower shall upon the
request of Administrative Agent provide to the Administrative Agent paper
copies of any such electronically delivered Compliance Certificates); provided
further, that the Borrower shall notify the Administrative Agent (by
telecopier or electronic mail) of the posting of any such documents pursuant to
clause (i) or (ii) above and provide to the Administrative Agent by electronic
mail electronic versions (i.e., soft copies) of such documents, and
Administrative hereby agrees that it shall use reasonable commercial efforts to
post such documents received pursuant to this clause (iii) on the Borrower’s
behalf to a commercial, third-party or other website sponsored by the
Administrative Agent and notify the Lenders of such posting.  Except as expressly provided in the foregoing
clause (iii) the Administrative Agent shall have no obligation to request the
delivery or to maintain copies of the documents referred to above, and in any
event shall have no responsibility to monitor compliance by the Borrower with
any such request for delivery, and each Lender shall be solely responsible for
requesting delivery to it or maintaining its copies of such documents.


 


The Borrower hereby
acknowledges that (a) the Administrative Agent and/or the Arranger will make
available to the Lenders and the L/C Issuer materials and/or information
provided by or on behalf of the Borrower hereunder (collectively, “Borrower
Materials”) by posting the Borrower Materials on IntraLinks or another
similar electronic system (the “Platform”) and (b) certain of the
Lenders may be “public-side” Lenders (i.e.,
Lenders that do not wish to receive material non-public information with
respect to the Borrower or its securities) (each, a “Public Lender”).  The Borrower hereby agrees that so long as
the Borrower is the issuer of any outstanding debt or equity securities that
are registered or issued pursuant to a private offering or is actively
contemplating issuing any such securities (w) all Borrower Materials that are
to be made available to Public Lenders shall be clearly and conspicuously
marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall
appear prominently on the first page thereof; (x) by marking Borrower Materials
“PUBLIC,” the Borrower shall be deemed to have authorized the Administrative
Agent, the Arranger, the L/C Issuer and the Lenders to treat such Borrower
Materials as not containing any material non-public information with respect to
the Borrower or its securities for purposes of United States Federal and state
securities laws (provided, however, that to the extent such Borrower Materials
constitute Information, they shall be treated as set forth in Section 10.07);
(y) all Borrower Materials marked “PUBLIC” are permitted to be made available
through a portion of the Platform designated “Public Investor;” and (z) the
Administrative Agent and the Arranger shall be entitled to treat any Borrower
Materials that are not marked “PUBLIC” as being suitable only for posting on a
portion of the Platform not designated “Public Investor.”


 


6.03                        Notices.  Promptly notify the Administrative Agent and
each Lender after any Responsible Officer has knowledge:


 


(a)                           of the occurrence of any
Default;


 


(b)                           of any matter that has resulted
or could reasonably be expected to result in a Material Adverse Effect,
including (i) breach or non-performance of, or any default under, a Contractual
Obligation of the Borrower or any Restricted Subsidiary; (ii) any dispute,
litigation, 


 


59





















 


investigation, proceeding or suspension between the Borrower or any Subsidiary
and any Governmental Authority; or (iii) the commencement of, or any material
development in, any litigation or proceeding affecting the Borrower or any Subsidiary,
including pursuant to any applicable Environmental Laws;


 


(c)                            of the occurrence of any
ERISA Event;


 


(d)                           of any material change in
accounting policies or financial reporting practices adopted by the Borrower or
any Restricted Subsidiary; and


 


(e)                            of the occurrence of any
Internal Control Event the occurrence of which would require disclosure under
the Securities Laws.


 


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


 


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


 


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


 


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


 


6.07                        Maintenance
of Insurance.  Maintain
with financially sound and reputable insurance companies not Affiliates of the
Borrower, insurance with respect to its properties and business against loss or
damage of the kinds customarily insured against by Persons engaged in 


 


60





















 


the same or similar business,
of such types and in such amounts as are customarily carried under similar
circumstances by such other Persons and providing (a) for payment of losses to
the Administrative Agent as its interests may appear, (b) that such policies
may not be canceled or reduced or affected in any material manner for any
reason without 30 days prior notice to the Administrative Agent, and (c) for
any other matters specified in any applicable Security Document or which the
Administrative Agent may reasonably require.


 


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


 


6.09                        Books
and Records.  Maintain
proper books of record in conformity with GAAP consistently applied regarding all
financial transactions and matters involving the assets and business of the
Borrower or such Restricted Subsidiary, as the case may be.


 


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


 


6.11                        Use
of Proceeds.  Use the
proceeds of the initial Credit Extension (a) to partially finance the
Acquisition, (b) to refinance outstanding Indebtedness under the Existing
Credit Agreement, (c) to retire the outstanding Indebtedness under the Comerica
Credit Facility and the ScissorTail Credit Facility, and (d) for the payment of
fees and expenses relating to the Acquisition, the Senior Bridge Facility and this
Agreement.  Use the proceeds of the other
Credit Extensions for working capital, acquisitions, Capital Expenditures, and
other general corporate purposes not in contravention of any Law or of any Loan
Document.


 


6.12                        Additional
Guarantors.  Notify the
Administrative Agent at the time that any Person becomes a Restricted
Subsidiary of the Borrower, and promptly thereafter (and in any event within 15
days), cause (a) such Person to (i) become a Guarantor by executing and
delivering to the Administrative Agent a counterpart of the Guaranty or a
joinder thereto in the form attached as Exhibit F, and (ii) deliver to
the Administrative Agent documents of the types referred to in clauses (iv) and
(v) of Section 4.01(a) and, upon request of the Administrative Agent, favorable
opinions of counsel to such Person (which shall cover, among other things, the
legality, validity, binding effect and enforceability of the documentation
referred to in clause (a)(i)), all in form, content and scope reasonably
satisfactory to the Administrative Agent; and (b) (i) cause all of the Equity
Interest of such Person to be pledged to the Administrative Agent 


 


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to secure the Obligations by executing and delivering the Pledge and
Security Agreement or a joinder thereto in the form attached as Exhibit G,
(ii) pursuant to the Pledge and Security Agreement, deliver or cause the
applicable Restricted Subsidiary to deliver to Administrative Agent all
certificates, stock powers and other documents required by the Pledge and
Security Agreement with respect to all such Equity Interests of any such Restricted
Subsidiary, (iii) take or cause the applicable Restricted Subsidiary to take
such other actions, all as may be necessary to provide the Administrative Agent
with a first priority perfected pledge or and security interest in such Equity
Interests in such Restricted Subsidiary, and (iv) deliver to the Administrative
Agent documents of the types referred to in clauses (iv) and (v) of Section
4.01(a) and, upon the request of the Administrative Agent, favorable opinions
of counsel to such Person (which shall cover, among other things, the legality,
validity, binding effect and enforceability of the documentation referred to in
clause (b)(i)), all in form, content and scope reasonably satisfactory to the
Administrative Agent.


 


6.13                        Agreement
to Deliver Security Documents.  Promptly deliver, to further secure the
Obligations, whenever requested by Administrative Agent in its sole and
absolute discretion, deeds of trust, mortgages, security agreements, title
searches, financing statements and other Security Documents in form and
substance satisfactory to Administrative Agent for the purpose of granting,
confirming, and perfecting first and prior liens or security interests, subject
only to Liens permitted under the Loan Documents, on any real or personal
property now owned or hereafter acquired by such Person with a fair market
value in excess of $5,000,000.  In
furtherance thereof, promptly notify Administrative Agent of (a) any material
acquisition (whether by purchase, lease or otherwise) of property or assets by
any Loan Party, and (b) any individual real properties in which a Loan Party or
any of its Restricted Subsidiaries has an interest (whether by acquisition,
lease or otherwise) with a fair market value in excess of $5,000,000.


 


6.14                        Perfection
and Protection of Security Interests and Liens.  Deliver from time to time to the Administrative
Agent any financing statements, continuation statements, extension agreements
and other documents, properly completed and executed (and acknowledged when
required) in form and substance reasonably satisfactory to the Administrative
Agent, which the Administrative Agent requests for the purpose of perfecting,
confirming, or protecting any Liens or other rights in any property securing
any Obligations.


 


6.15                        Performance
on Loan Parties’ Behalf.  Immediately reimburse the Administrative
Agent after notice by the Administrative Agent is given to the Borrower of any
payment by the Administrative Agent of any taxes or insurance premiums Borrower
or any Restricted Subsidiary is required to pay under any Loan Document, which
Administrative Agent is hereby authorized to pay, each such amount paid by the
Administrative Agent constituting an Obligation owed hereunder and due and
payable on the date such amount is paid by the Administrative Agent.


 


6.16                        Environmental
Matters; Environmental Reviews.


 


(a)                           (i) Comply in all material
respects with all Environmental Laws now or hereafter applicable to such Person
as well as all contractual obligations and agreements with respect to
environmental remediation or other environmental matters, (ii) obtain, at or
prior to the time 


 


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required by applicable Environmental Laws, all permits, licenses and
other authorizations under applicable Environmental Laws necessary for its then
current operations and will maintain such authorizations in full force and
effect, (iii) conduct any investigation, study, sampling and testing, and
undertake any cleanup, removal, remedial or other action necessary to remove
and clean up Hazardous Materials at or from any of its properties, as may be
required by, and in accordance with the requirements of, applicable Environmental
Laws.  Promptly pay and discharge when
due all debts, claims, liabilities and obligations with respect to any clean-up
or remediation measures necessary to comply with Environmental Laws unless, in
each case, the same are being contested in good faith by appropriate
proceedings diligently conducted and adequate reserves in accordance with GAAP
are being maintained by the applicable Person.


 


(b)                           Promptly furnish to Administrative
Agent all written notices of violation, orders, claims, citations, complaints,
penalty assessments, suits or other proceedings received by such Person, or of
which it has notice, pending or threatened against such Person, the potential
liability of which exceeds $5,000,000 or could reasonably be expected to have a
Material Adverse Effect if resolved adversely against such Person, by any
Governmental Authority with respect to any alleged violation of or
non-compliance with any applicable Environmental Laws or any permits, licenses
or authorizations required under applicable Environmental Laws in connection
with its ownership or use of its properties or the operation of its business.


 


(c)                            Promptly furnish to
Administrative Agent all written requests for information, notices of claim,
demand letters, and other written notifications, received by such Person in
connection with its ownership or use of its properties or the conduct of its
business, relating to potential responsibility with respect to any investigation
or clean-up of Hazardous Material arising from its operations at any location,
the potential liability of which exceeds $5,000,000 or could reasonably be
expected to have a Material Adverse Effect if resolved adversely against such
Person.


 


6.17                        Compliance
with Agreements.  Observe, perform or comply with each Material
Contract, unless any such failure to so observe, perform or comply is remedied
within the applicable period of grace (if any) provided in such Material
Contract or unless such failure to so observe, perform or comply would not
reasonably be expected to have a Material Adverse Effect.


 


6.18                        Unrestricted
Subsidiaries. 
Will cause the management, business and affairs of each of
the Borrower and its Restricted Subsidiaries to be conducted in such a manner
(including, without limitation, by keeping separate books of account,
furnishing separate financial statements of Unrestricted Subsidiaries to
creditors and potential creditors thereof and by not permitting properties of
the Borrower and its Restricted Subsidiaries to be commingled) so that each
Unrestricted Subsidiary that is a corporation or other legal entity will be
treated as an entity separate and distinct from the Borrower and the Restricted
Subsidiaries.


 


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ARTICLE VII.

NEGATIVE COVENANTS


 


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


 


7.01                        Liens.  Create, incur, assume or suffer to exist any
Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, other than the following:


 


(a)                           Liens pursuant to any Loan
Document;


 


(b)                           Liens existing on the date
hereof and listed on Schedule 7.01 and any renewals or extensions
thereof, provided that (i) the property covered thereby is not changed,
(ii) the amount secured or benefited thereby is not increased (except as
provided in Section 7.03(c)), (iii) the direct or any contingent obligor with
respect thereto is not changed, and (iv) any renewal or extension of the
obligations secured or benefited thereby is permitted by Section 7.03(c);


 


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


 


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


 


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


 


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


 


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


 


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


 


(i)                               Liens securing Indebtedness
permitted under Section 7.03(g); provided that (i) such
Liens do not at any time encumber any property other than the property financed
by 


 


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such Indebtedness and (ii) the Indebtedness secured thereby does not
exceed the cost or fair market value, whichever is lower, of the property being
acquired on the date of acquisition;


 


(j)                              Liens arising solely by
virtue of any statutory or common law provision relating to banker’s liens,
rights of set-off or similar rights and remedies, or under general depository or
brokerage agreements, and burdening only deposit or brokerage accounts or other
funds and assets maintained with a creditor depository institution or brokerage;


 


(k)                           Liens arising from
precautionary UCC financing statements relating to operating leases and other
contractual arrangements entered into in the ordinary course of business that
describe only the property subject to such operating lease or contractual arrangement;
and


 


(l)                               statutory Liens arising
in the ordinary course of business relating to purchases of crude oil, natural
gas and other hydrocarbons in favor of producers thereof (“first purchaser
Liens”); provided that (i) such Liens do not at any time encumber
any property other than the crude oil, natural gas or other hydrocarbons being
purchased and secure only amounts due for the purchase thereof, and (ii) the amount
secured thereby is not overdue for a period of more than 30 days or is
otherwise being contested in good faith and by appropriate proceedings
diligently conducted, if adequate reserves with respect thereto are maintained
on the books of the applicable Person;


 


provided,
nothing in this Section 7.01 shall in and of itself constitute or be deemed to
constitute an agreement or acknowledgment by the Administrative Agent or any
Lender that any Indebtedness subject to or secured by any Lien, right or other
interest permitted under subsections (a) through (i) above ranks in priority to
any Obligation.


 


7.02                        Investments.  Make any Investments, except:


 


(a)                           Investments held by the
Borrower or such Loan Party in the form of cash equivalents or short-term
marketable debt securities;


 


(b)                           advances to officers,
directors and employees of the Borrower and Restricted Subsidiaries in an aggregate
amount not to exceed $100,000 at any time outstanding, for travel,
entertainment, relocation and analogous ordinary business purposes;


 


(c)                            Investments of the Borrower
in any wholly-owned Subsidiary that is a Guarantor and Investments of any
wholly-owned Subsidiary that is a Guarantor in the Borrower or in another
wholly-owned Subsidiary that is a Guarantor;


 


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


 


(e)                            Guarantees permitted by Section 7.03;


 


(f)                             Investments in
Unrestricted Subsidiaries (net of any distributions received by the Borrower
and Restricted Subsidiaries with respect to such Investments), provided that
(i) the 


 


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aggregate amount of all such Investments made after the Closing Date shall
not at any time exceed $25,000,000, and (ii) after giving effect to any such
Investment, the Borrower has at least $10,000,000 in unused availability under
the Commitments; and


 


(g)                            other Investments (including
Investments in Persons that are not Subsidiaries) not exceeding $1,000,000 in
the aggregate in any fiscal year of the Borrower.


 


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


 


(a)                           Indebtedness under the Loan
Documents;


 


(b)                           Unsecured Indebtedness under
the Senior Bridge Facility (or any unsecured refinancing or replacement thereof
with a maturity not earlier than 91 days after the Maturity Date and on terms
and conditions not materially more restrictive than the Loan Documents taken as
a whole) in an aggregate principal amount not to exceed $200,000,000 at any
time outstanding;


 


(c)                            Indebtedness outstanding on
the date hereof and listed on Schedule 7.03 and any refinancings,
refundings, renewals or extensions thereof; provided that the amount of
such Indebtedness is not increased at the time of such refinancing, refunding,
renewal or extension except by an amount equal to a reasonable premium or other
reasonable amount paid, and fees and expenses reasonably incurred, in
connection with such refinancing and by an amount equal to any existing
commitments unutilized thereunder;


 


(d)                           Guarantees of the Borrower
or any Guarantor in respect of Indebtedness otherwise permitted hereunder of
the Borrower or any other Guarantor;


 


(e)                            unsecured Indebtedness of
the Borrower or any Guarantor, provided that (i) the Loan Parties comply with
the provisions of Section 2.05(e) and (ii) such Indebtedness qualifies as
Subordinated Debt;


 


(f)                             obligations (contingent or
otherwise) of the Borrower or any Restricted Subsidiary existing or arising
under any Hedging Contract, provided that (i) such obligations are (or
were) entered into by such Person in the ordinary course of business for the
purpose of directly mitigating risks associated with liabilities, commitments,
investments, assets, or property held or reasonably anticipated by such Person,
or changes in the value of securities issued by such Person, and not for
purposes of speculation or taking a “market view;” and (ii) such Hedging
Contract does not contain any provision exonerating the non-defaulting party
from its obligation to make payments on outstanding transactions to the
defaulting party;


 


(g)                            Indebtedness in respect of
capital leases, Synthetic Lease Obligations and purchase money obligations
within the limitations set forth in Section 7.01(i); provided,
however, that the aggregate amount of all such Indebtedness at any one
time outstanding shall not exceed $5,000,000;


 


(h)                           Indebtedness of any Loan
Party owing to another Loan Party;


 


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(i)                               Indebtedness (other than
as described in clause (a) of the definition of the term “Indebtedness”) of (A)
Copano/Webb-Duval Pipeline, L.P. (“Webb/Duval GP”) that was incurred in the
ordinary course of business by Webb/Duval Gatherers and is Indebtedness of
Webb/Duval GP solely by virtue of the fact that it is a general partner of
Webb/Duval Gatherers and (B) a general partner of Webb/Duval GP with respect to
the Indebtedness described in clause (A) solely by virtue of the fact that it
is such general partner; and


 


(j)                              Other unsecured
Indebtedness in an aggregate principal amount not to exceed $5,000,000 at any
time outstanding.


 


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


 


(a)                           any wholly-owned Restricted Subsidiary
may merge with (i) the Borrower, provided that the Borrower shall be the
continuing or surviving Person, or (ii) any one or more other wholly-owned
Restricted Subsidiaries; and


 


(b)                           any Restricted Subsidiary
may Dispose of all or substantially all of its assets (upon voluntary
liquidation or otherwise) to the Borrower or to a wholly-owned Restricted Subsidiary.


 


The Borrower will not issue any
Equity Interests which (i) may be classified in whole or part as Indebtedness, (ii)
require mandatory distributions (other than distributions of Available Cash
permitted under Section 7.06(d)) or mandatory redemption prior to 91
days after the Maturity Date, or (iii) provide for a scheduled distribution
above generally prevailing market rates at the time of issuance.  No Restricted Subsidiary of the Borrower will
issue any additional Equity Interests, except a direct Subsidiary of a Loan
Party may issue additional Equity Interests to such Loan Party or to the
Borrower so long as (i) such Restricted Subsidiary is a wholly-owned Restricted
Subsidiary of the Borrower after giving effect thereto, and (ii) such Equity
Interests shall be pledged to the Administrative Agent for the benefit of the
Lenders pursuant to Security Documents acceptable to the Administrative
Agent.  No Restricted Subsidiary of the Borrower
that is a partnership will allow any reduction of the Borrower’s interest
(direct or indirect) therein.


 


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


 


(a)                           Dispositions of obsolete,
surplus or worn out property, whether now owned or hereafter acquired, in the
ordinary course of business;


 


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


 


(c)                            Dispositions of equipment
or real property so long as (i) the purchase price for such asset shall be
paid solely in cash; (ii) the aggregate purchase price paid to Loan
Parties for such asset and all other such assets sold by Loan Parties during
any period of four consecutive fiscal quarters pursuant to this clause
(c) shall not exceed $5,000,000; (iii) if the portion of the 


 


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aggregate annual Consolidated EBITDA derived from all assets sold
pursuant to this clause (c) during any period of four fiscal quarters and based
on the four fiscal quarters (as to any assets of the Borrower or any Restricted
Subsidiary other than ScissorTail and its Restricted Subsidiaries) or
annualized portion thereof (as to any assets of ScissorTail and its Restricted
Subsidiaries as provided in Section 7.21(e)) prior to the sale of such asset
would exceed $2,000,000, the consent (not to be unreasonably withheld) of the
Required Lenders is obtained in connection with any such sale; (iv) no
Default or Event of Default shall exist prior to or after giving effect to such
sale; and (v) the Net Cash Proceeds of such sale shall have been applied
as follows (A) within one-hundred eighty (180) days after the date of such
receipt of Net Cash Proceeds to the purchase of capital assets used in its business
or (B) to the extent Net Cash Proceeds have not been applied pursuant to
the immediately preceding clause (A), such amount (the “Excess Sale Proceeds”) shall have been applied
to prepay the Loans as provided in Section 2.05;


 


(d)                           Dispositions of property by
any Loan Party to another Loan Party;


 


(e)                            Dispositions permitted by Section 7.04;


 


(f)                             Dispositions of Equity
Interests in Unrestricted Subsidiaries; and


 


(g)                            Dispositions by the
Borrower and its Restricted Subsidiaries not otherwise permitted under this Section 7.05;
provided that (i) at the time of such Disposition, no Default shall
exist or would result from such Disposition and (ii) the aggregate book value
of all property Disposed of in reliance on this clause (g) in any fiscal year
shall not exceed $1,000,000;


 


provided, however, that any Disposition
pursuant to clauses (a) through (g) shall be for fair market value.


 


7.06                        Restricted
Payments.  Declare or make, directly or indirectly, any
Restricted Payment, or incur any obligation (contingent or otherwise) to do so,
except that, so long as no Default shall have occurred and be continuing at the
time of any action described below or would result therefrom(except as
otherwise provided in subsection (d) below):


 


(a)                           each Restricted Subsidiary
may make Restricted Payments to the Borrower or any Guarantor ratably according
to their respective holdings of the type of Equity Interest in respect of which
such Restricted Payment is being made;


 


(b)                           the Borrower and each Restricted
Subsidiary may declare and make dividend payments or other distributions
payable solely of the type of Equity Interests in respect of which such Restricted
Payment is being made;


 


(c)                            the Borrower and each Restricted
Subsidiary may purchase, redeem or otherwise acquire Equity Interests (other
than preferred Equity Interests dissimilar in type to new Equity Interests
being concurrently issued) issued by it with the proceeds received from the substantially
concurrent issue of new Equity Interests; and


 


(d)                           so long as no Event of
Default has occurred and is continuing at such time and so long as no Default
or Event of Default would exist after giving pro forma effect to such 


 


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transaction, the Borrower may declare cash quarterly distributions to
its members in an amount equal to Available Cash and, notwithstanding the
occurrence of any Default or Event of Default following such declaration, pay such
declared distributions.


 


7.07                        Change in
Nature of Business.  Engage in any material line of business
substantially different from those lines of business conducted by the Borrower
and its Restricted Subsidiaries on the date hereof or any business substantially
related or incidental thereto.


 


7.08                        Transactions
with Affiliates.  Enter into any transaction of any kind with any
Affiliate of the Borrower, whether or not in the ordinary course of business,
other than on fair and reasonable terms substantially as favorable to the
Borrower or such Restricted Subsidiary as would be obtainable by the Borrower
or such Restricted Subsidiary at the time in a comparable arm’s length
transaction with a Person other than an Affiliate, provided that the foregoing
restriction shall not apply to (i) transactions between or among the Borrower
and any Guarantor or between and among any Guarantors or (ii) ScissorTail’s
guarantee of the performance by Southern Dome of its obligations under that
certain Gas Purchase and Processing Agreement effective May 1, 2005 by and
between Southern Dome and New Dominion, L.L.C.


 


7.09                        Burdensome
Agreements.  Enter into any Contractual Obligation (other than
this Agreement or any other Loan Document) that (a) limits the ability (i) of
any Restricted Subsidiary to make Restricted Payments to the Borrower or any
Guarantor or to otherwise transfer property to the Borrower or any Guarantor,
(ii) of any Restricted Subsidiary to Guarantee the Indebtedness of the Borrower
or (iii) of the Borrower or any Restricted Subsidiary to create, incur, assume
or suffer to exist Liens on property of such Person in favor of Administrative
Agent and Lenders; provided, however, that this clause (iii)
shall not prohibit any negative pledge incurred or provided in favor of any
holder of Indebtedness permitted under Section 7.03(g) solely to
the extent any such negative pledge relates to the property financed by or the
subject of such Indebtedness; or (b) requires the grant of a Lien to secure an
obligation of such Person if a Lien is granted to secure another obligation of
such Person.


 


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


 


7.11                        Prohibited
Contracts.  Other than those listed
on Schedule 7.11:


 


(a)                           enter into any “take-or-pay”
contract or other contract or arrangement for the purchase of goods or services
which obligates it to pay for such goods or service regardless of whether they
are delivered or furnished to it, other than contracts for pipeline capacity or
for services in either case reasonably anticipated to be utilized in the
ordinary course of business;


 


(b)                           amend or permit any
amendment to any Material Contract which releases, qualifies, limits, makes
contingent or otherwise could reasonably be expected to detrimentally affect
the rights and benefits of Administrative Agent or any Lender under or acquired
pursuant to any Security Documents; or


 


69





















 


(c)                            incur any obligation to
contribute to any Multiemployer Plan or permit any ERISA Affiliate to do so.


 


7.12                        Hedging
Contracts.  Be a party to or in any
manner be liable on any Hedging Contract, except:


 


(a)                           Hedging Contracts entered
into by a Loan Party with the purpose and effect of fixing interest rates on a
principal amount of Indebtedness of such Loan Party that is accruing interest
at a variable rate, provided that (i) the aggregate notional amount of such
contracts never exceeds one hundred percent (100%) of the anticipated outstanding
principal balance of the Indebtedness to be hedged by such contracts or an
average of such principal balances calculated using a generally accepted method
of matching interest swap contracts to declining principal balances, (ii) the
floating rate index of each such contract generally matches the index used to
determine the floating rates of interest on the corresponding Indebtedness to
be hedged by such contract and (iii) each such contract is with an Approved Counterparty;


 


(b)                           Hedging Contracts entered
into with an Approved Counterparty and in compliance with the Risk Management
Policy.


 


7.13                        Subsidiaries.  Create or acquire any additional Restricted
Subsidiary or redesignate an Unrestricted Subsidiary as a Restricted Subsidiary
unless the Borrower gives written notice to the Administrative Agent of such
creation or acquisition and complies with Sections  6.12, 6.13,
and 7.19.


 


7.14                        Limitation
on Credit Extensions.  Except for
Investments permitted under Section 7.02 and Hedging Contracts permitted hereunder,
extend credit, make advances or make loans other than normal and prudent
extensions of credit to customers buying goods and services in the ordinary
course of business or to another Loan Party in the ordinary course of business,
which extensions shall not be for longer periods than those extended by similar
businesses operated in a normal and prudent manner.


 


7.15                        Risk
Management Compliance.  Enter into any
Hedging Contract that is in violation of the Risk Management Policy.  The Borrower agrees that upon request by the
Administrative Agent, from time to time, the Borrower and the Administrative
Agent will review and evaluate the Borrowers’ Risk Management Policy.


 


7.16                        Subordinated
Debt.  Make any payments of principal or interest on the
Subordinated Debt except in accordance with the terms and conditions thereof.


 


7.17                        Material
Contracts.  (a) Cancel or terminate
any Material Contract (or consent to or accept any cancellation or termination
thereof), or (b) amend or otherwise modify any provision of any Material
Contract or give any consent, waiver or approval thereunder, or waive any material
breach of or material default under any Material Contract that could reasonably
be expected to detrimentally affect the rights and benefits of the Administrative
Agent and/or the Lenders hereunder or under any other Loan Document.


 


7.18                        Designation
and Conversion of Restricted and Unrestricted Subsidiaries; Debt of
Unrestricted Subsidiaries.


 


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(a)                           Unless designated as an
Unrestricted Subsidiary on Schedule 5.13 as of the Closing Date, designate
any Person that becomes a Subsidiary of the Borrower or any Restricted
Subsidiary as an Unrestricted Subsidiary, except the Borrower may designate by
written notification thereof to the Administrative Agent, any Restricted
Subsidiary, including a newly formed or newly acquired Subsidiary, as an
Unrestricted Subsidiary if (i) prior, and after giving effect, to such
designation, no Default would exist and (ii) such designation is deemed to be
an Investment in an Unrestricted Subsidiary in an amount equal to the fair
market value as of the date of such designation of the Borrower’s direct and
indirect ownership interest in such Subsidiary and such Investment would be
permitted to be made at the time of such designation under Section 7.02(f).


 


(b)                           Designate any Unrestricted
Subsidiary to be a Restricted Subsidiary, except if after giving effect to such
designation, which shall be deemed to be a cash dividend in an amount equal to
the lesser of the fair market value of the Borrower’s direct and indirect
ownership interest in such Subsidiary or the amount of the Borrower’s cash
investment previously made for purposes of the limitation on Investments under Section
7.02(f), (i) the representations and warranties of the Borrower and its
Restricted Subsidiaries contained in each of the Loan Documents are true and
correct in all material respects on and as of such date as if made on and as of
the date of such redesignation (or, if stated to have been made expressly as of
an earlier date, were true and correct as of such date), (ii) no Default would
exist, and (iii) the Borrower and such newly-designated Restricted Subsidiary complies
with the requirements of Sections 6.12 and 6.13.


 


(c)                            will not incur, assume,
Guarantee or otherwise be or become liable for any Indebtedness of any of the
Unrestricted Subsidiaries, except as described in Section 7.03(i).


 


(d)                           will not permit any
Unrestricted Subsidiary to hold any Equity Interest in, or any Indebtedness of,
the Borrower or any Restricted Subsidiary.


 


(e)                            shall not permit the
aggregate principal amount of all Non-Recourse Debt outstanding at any one time
to exceed $10,000,000.


 


7.19                        Capital
Expenditures.  Use the proceeds of
any Loans to make or commit to make Capital Expenditures in any fiscal year in
excess of 10% of the Aggregate Commitments in respect of Capital Expenditures
relating to acquisitions or construction (other than acquisitions or
construction of natural gas, natural gas liquids and crude oil pipelines,
processing, treating and gathering systems, including compression, metering,
dehydrating and similar equipment, natural gas and natural gas liquids storage
facilities, and in each case, related facilities); provided such Persons
may make Capital Expenditures as are required by any Law (including
Environmental Laws).


 


7.20                        Amendments
to Organizational Documents.  (a)
Amend or otherwise modify the definition of “Available Cash” as set forth in
the Borrower LLC Agreement, or (b) enter into or permit any other modification
of, or waive any material right or obligation of any Person under, its
Organization Documents that could reasonably be expected to detrimentally
affect the rights and benefits of Administrative Agent and/or Lenders hereunder
or under any other Loan Document.


 


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7.21                        Financial
Covenants.


 


(a)                           Consolidated Fixed Charge
Coverage Ratio.  Permit the Consolidated Fixed Charge Coverage
Ratio as of the end of any fiscal quarter of the Borrower to be less than the
ratio set forth below opposite such quarter:


 


	
  Four Fiscal Quarters Ending

  	
   

  	
  Minimum 

  Consolidated Fixed 

  Charge Coverage 

  Ratio

  	
   

  
	
  Closing
  Date through September 30, 2005

  	
   

  	
  1.50 to 1.0

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  December
  31, 2005 and each fiscal quarter thereafter

  	
   

  	
  1.75 to 1.0

  	
   

  



 


(b)                           Consolidated Interest
Coverage Ratio.  Permit the Consolidated Interest Coverage Ratio
as of the end of any fiscal quarter of the Borrower to be less than the ratio
set forth below opposite such fiscal quarter:


 


	
  Four Fiscal Quarters Ending

  	
   

  	
  Minimum 

  Consolidated 

  Interest Coverage 

  Ratio

  	
   

  
	
  Closing
  Date through September 30, 2005

  	
   

  	
  2.50 to 1.0

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  December
  31, 2005 through June 30, 2006

  	
   

  	
  2.75 to 1.0

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  September
  30, 2006 and each fiscal quarter thereafter

  	
   

  	
  3.0 to 1.0

  	
   

  



 


(c)                            Consolidated Senior Leverage
Ratio.  Permit the Consolidated Senior Leverage Ratio at any time
during any period of four fiscal quarters of the Borrower set forth below to be
greater than the ratio set forth below opposite such period:


 


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  Four Fiscal Quarters Ending

  	
   

  	
  Maximum 

  Consolidated 

  Senior Leverage 

  Ratio

  	
   

  
	
  Closing
  Date through September 30, 2005

  	
   

  	
  3.75 to 1.0

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  December
  31, 2005 and each fiscal quarter thereafter

  	
   

  	
  3.50 to 1.0

  	
   

  



 


(d)                           Consolidated Total
Leverage Ratio.  Permit the Consolidated Total Leverage Ratio at
any time during any period of four fiscal quarters of the Borrower set forth
below to be greater than the ratio set forth below opposite such period:


 


	
  Four Fiscal Quarters Ending

  	
   

  	
  Maximum 

  Consolidated 

  Total Leverage 

  Ratio

  	
   

  
	
  Closing
  Date through September 30, 2005

  	
   

  	
  5.50 to 1.0

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  December
  31, 2005 through June 30, 2006

  	
   

  	
  5.00 to 1.0

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  September
  30, 2006 and each fiscal quarter thereafter

  	
   

  	
  4.75 to 1.0

  	
   

  



 


(e)                            Calculation of Financial
Covenants.  With respect to the calculation of the Fixed Charge
Coverage Ratio, the Consolidated Interest Coverage Ratio, the Senior Leverage
Ratio and the Consolidated Total Leverage Ratio in this Section 7.21 (and
Consolidated EBITDA as used in Section 7.05(c)), Consolidated EBITDA,
Consolidated Fixed Charges, Consolidated Interest Charges and Consolidated Net
Income of ScissorTail and its Restricted Subsidiaries (if any) (i) shall be
determined for the quarter ended September 30, 2005 by grossing-up the
applicable  component results from the
Closing Date through the last day of such quarter to a quarterly amount and
(ii) shall, prior to June 30, 2006, be determined for the periods ending on
September 30, 2005, December 31, 2005 and March 31, 2005 on an annualized basis;
e.g.: for the period ending September 30, 2005, results for the quarter will be
annualized by multiplying such results by four; for the period ending December
31, 2005, results for the two-quarter period will be annualized by multiplying
such results by two; and for the period ending March 31, 2006, results for the
three-quarter period will be annualized by multiplying such results by one and
one-third.


 


ARTICLE VIII.

EVENTS OF DEFAULT AND REMEDIES


 


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


 


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


 


(b)                           Specific Covenants.  The
Borrower fails to perform or observe any term, covenant or agreement contained
in any of Sections 6.03, 6.05(a), 6.10, 6.11 or 6.12 or Article VII; or


 


(c)                            Other Defaults.  Any
Loan Party fails to perform or observe any other covenant or agreement (not
specified in subsection (a) or (b) above) contained in any Loan Document on its
part to be performed or observed and such failure continues for 30 days after
the earlier of (i) the date on which the Administrative Agent notifies Borrower
of such failure or (ii) the date on which a Responsible Officer of any Loan
Party first becomes aware of such failure; or


 


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


 


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


 


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


 


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


 


(h)                           Judgments.  There
is entered against the Borrower or any Restricted Subsidiary (i) a final
judgment or order for the payment of money in an aggregate amount exceeding the
Threshold Amount (to the extent not covered by independent third-party
insurance as to which the insurer does not dispute coverage), or (ii) any one
or more non-monetary final judgments that have, or could reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect and, in
either case, (A) enforcement proceedings are commenced by any creditor upon
such judgment or order, or (B) there is a period of 30 consecutive days during
which a stay of enforcement of such judgment, by reason of a pending appeal or
otherwise, is not in effect; or


 


(i)                               ERISA.  (i) An
ERISA Event occurs with respect to a Pension Plan or Multiemployer Plan which
has resulted or could reasonably be expected to result in liability of the
Borrower under Title IV of ERISA to the Pension Plan, Multiemployer Plan
or the PBGC in an aggregate amount in excess of the Threshold Amount, or (ii)
the Borrower or any ERISA Affiliate fails to pay when due, after the expiration
of any applicable grace period, any installment payment with respect to its
withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan in
an aggregate amount in excess of the Threshold Amount; or


 


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


 


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


 


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


 


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


 


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


 


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


 


(d)                           exercise on behalf of itself
and the Lenders all rights and remedies available to it and the Lenders under
the Loan Documents;


 


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


 


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


 


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


 


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


 


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


 


Fourth, to payment
of that portion of the Obligations constituting unpaid principal of the Loans
and L/C Borrowings and to the Secured Hedging Obligations, ratably among the
Lenders, the L/C Issuer, the Lender Counterparties, and the Approved
Counterparties in proportion to the respective amounts described in this clause
Fourth held by them;


 


Fifth, to the
Administrative Agent for the account of the L/C Issuer, to Cash Collateralize
that portion of L/C Obligations comprised of the aggregate undrawn amount of
Letters of Credit; and


 


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


 


Subject to Section 2.03(c), amounts used to Cash
Collateralize the aggregate undrawn amount of Letters of Credit pursuant to
clause Fifth above shall be applied to satisfy drawings under such
Letters of Credit as they occur.  If any
amount remains on deposit as Cash Collateral after all Letters of Credit have
either been fully drawn or expired, such remaining amount shall be applied to
the other Obligations, if any, in the order set forth above.


 


ARTICLE
IX.

ADMINISTRATIVE AGENT


 


9.01                        Appointment
and Authority.  Each of the Lenders and the L/C Issuer hereby
irrevocably appoints Bank of America to act on its behalf as the Administrative
Agent hereunder and under the other Loan Documents and authorizes the
Administrative Agent to take such actions on its behalf and to exercise such
powers as are delegated to the Administrative Agent by the terms hereof or
thereof, together with such actions and powers as are reasonably incidental
thereto.  The provisions of this Article
are solely for the benefit of the Administrative Agent, the Lenders and the L/C
Issuer, and neither the Borrower nor
any other Loan Party shall have rights as a third party beneficiary of
any of such provisions.


 


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


 


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


 


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


 


(b)                           shall not have any duty to
take any discretionary action or exercise any discretionary powers, except
discretionary rights and powers expressly contemplated hereby or by the other
Loan Documents that the Administrative Agent is required to exercise as
directed in writing by the Required Lenders (or such other number or percentage
of the Lenders as shall be expressly provided for herein or in the other Loan
Documents), provided that the Administrative Agent shall not be required
to take any action that, in its opinion or the opinion of its counsel, may
expose the Administrative Agent to liability or that is contrary to any Loan
Document or applicable Law; and


 


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


 


The Administrative Agent shall not be liable
for any action taken or not taken by it (i) with the consent or at the request
of the Required Lenders (or such other number or percentage of the Lenders as
shall be necessary, or as the Administrative Agent shall believe in good faith
shall be necessary, under the circumstances as provided in Sections 10.01
and 8.02) or (ii) in the absence of its own gross negligence or willful
misconduct.  The Administrative Agent
shall be deemed not to have knowledge of any Default unless and until notice
describing such Default is given to the Administrative Agent by the Borrower, a
Lender or the L/C Issuer.


 


The Administrative Agent shall not be
responsible for or have any duty to ascertain or inquire into (i) any
statement, warranty or representation made in or in connection with this
Agreement or any other Loan Document, (ii) the contents of any certificate,
report or other document delivered hereunder or thereunder or in connection
herewith or therewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth herein or therein
or the occurrence of any Default, (iv) the validity, enforceability,
effectiveness or genuineness of this Agreement, any other Loan Document or any
other agreement, instrument or document or (v) the satisfaction of any
condition set forth in Article IV or elsewhere herein, other than to
confirm receipt of items expressly required to be delivered to the
Administrative Agent.


 


9.04                        Reliance
by Administrative Agent.  The Administrative Agent shall be
entitled to rely upon, and shall not incur any liability for relying upon, any
notice, request, certificate, consent, statement, instrument, document or other
writing (including any electronic message, Internet or intranet website posting
or other distribution) believed by it to be genuine and to have been signed, sent
or otherwise authenticated by the proper Person.  The Administrative Agent also may rely upon
any statement made to it orally or by telephone and believed by it to have been
made by the proper Person, and shall not incur any liability for relying thereon.  In 


 


78





















 


determining compliance with any condition
hereunder to the making of a Loan, or the issuance of a Letter of Credit, that
by its terms must be fulfilled to the satisfaction of a Lender or the L/C Issuer,
the Administrative Agent may presume that such condition is satisfactory to
such Lender or the L/C Issuer unless the Administrative Agent shall have
received notice to the contrary from such Lender or the L/C Issuer prior to the
making of such Loan or the issuance of such Letter of Credit.  The Administrative Agent may consult with
legal counsel (who may be counsel for the Borrower), independent accountants
and other experts selected by it, and shall not be liable for any action taken
or not taken by it in accordance with the advice of any such counsel,
accountants or experts.


 


9.05                        Delegation
of Duties.  The Administrative Agent may perform any and all of
its duties and exercise its rights and powers hereunder or under any other Loan
Document by or through any one or more sub-agents appointed by the
Administrative Agent.  The Administrative
Agent and any such sub-agent may perform any and all of its duties and
exercise its rights and powers by or through their respective Related
Parties.  The exculpatory provisions of
this Article shall apply to any such sub-agent and to the Related Parties
of the Administrative Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.


 


9.06                        Resignation
of Administrative Agent.  The Administrative Agent may at any
time give notice of its resignation to the Lenders, the L/C Issuer and the
Borrower.  Upon receipt of any such notice
of resignation, the Required Lenders shall have the right, in consultation with
the Borrower, to appoint a successor, which shall be a bank with an office in
the United States, or an Affiliate of any such bank with an office in the
United States.  If no such successor
shall have been so appointed by the Required Lenders and shall have accepted
such appointment within 30 days after the retiring Administrative Agent
gives notice of its resignation, then the retiring Administrative Agent may on
behalf of the Lenders and the L/C Issuer, appoint a successor Administrative
Agent meeting the qualifications set forth above; provided that if the
Administrative Agent shall notify the Borrower and the Lenders that no
qualifying Person has accepted such appointment, then such resignation shall
nonetheless become effective in accordance with such notice and (1) the
retiring Administrative Agent shall be discharged from its duties and
obligations hereunder and under the other Loan Documents (except that in the case of any collateral
security held by the Administrative Agent on behalf of the Lenders or the L/C
Issuer under any of the Loan Documents, the retiring Administrative Agent shall
continue to hold such collateral security until such time as a successor
Administrative Agent is appointed) and (2) all payments,
communications and determinations provided to be made by, to or through the
Administrative Agent shall instead be made by or to each Lender and the L/C
Issuer directly, until such time as the Required Lenders appoint a successor
Administrative Agent as provided for above in this Section.  Upon the acceptance of a successor’s
appointment as Administrative Agent hereunder, such successor shall succeed to
and become vested with all of the rights, powers, privileges and duties of the
retiring (or retired) Administrative Agent, and the retiring Administrative
Agent shall be discharged from all of its duties and obligations hereunder or
under the other Loan Documents (if not already discharged therefrom as provided
above in this Section).  The fees payable
by the Borrower to a successor Administrative Agent shall be the same as those
payable to its predecessor unless otherwise agreed between the Borrower and
such successor.  After the retiring
Administrative Agent’s resignation hereunder and under the other Loan
Documents, the provisions of this Article and Section 10.04 shall
continue in effect for the 


 


79





















 


benefit of such retiring Administrative
Agent, its sub-agents and their respective Related Parties in respect of
any actions taken or omitted to be taken by any of them while the retiring
Administrative Agent was acting as Administrative Agent.


 


Any resignation by Bank of America as
Administrative Agent pursuant to this Section shall also constitute its
resignation as L/C Issuer.  Upon the
acceptance of a successor’s appointment as Administrative Agent hereunder, (a)
such successor shall succeed to and become vested with all of the rights,
powers, privileges and duties of the retiring L/C Issuer, (b) the retiring L/C
Issuer shall be discharged from all of their respective duties and obligations
hereunder or under the other Loan Documents, and (c) the successor L/C Issuer
shall issue letters of credit in substitution for the Letters of Credit, if
any, outstanding at the time of such succession or make other arrangements
satisfactory to the retiring L/C Issuer to effectively assume the obligations
of the retiring L/C Issuer with respect to such Letters of Credit.


 


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


 


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


 


9.09                        Administrative
Agent May File Proofs of Claim.  In case of the pendency of any
receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement,
adjustment, composition or other judicial proceeding relative to any Loan
Party, the Administrative Agent (irrespective of whether the principal of any
Loan or L/C Obligation shall then be due and payable as herein expressed or by
declaration or otherwise and irrespective of whether the Administrative Agent
shall have made any demand on the Borrower) shall be entitled and empowered, by
intervention in such proceeding or otherwise


 


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


 


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


 


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


 


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


 


9.10                        Collateral
and Guaranty Matters.  The Lenders and the L/C Issuer irrevocably
authorize the Administrative Agent, at its option and in its discretion,


 


(a)                           to release any Lien on any
property granted to or held by the Administrative Agent under any Loan Document
(i) upon termination of the Aggregate Commitments and payment in full of all
Obligations (other than contingent indemnification obligations) and the
expiration or termination of all Letters of Credit, (ii) that is sold or to be
sold as part of or in connection with any sale permitted hereunder or under any
other Loan Document, or (iii) subject to Section 10.01, if approved, authorized
or ratified in writing by the Required Lenders;


 


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


 


(c)                            to release any Guarantor
from its obligations under the Guaranty if such Person ceases to be a Restricted
Subsidiary as a result of a transaction permitted hereunder.


 


Upon request by the Administrative Agent at
any time, the Required Lenders will confirm in writing the Administrative Agent’s
authority to release or subordinate its interest in particular types or items
of property, or to release any Guarantor from its obligations under the
Guaranty pursuant to this Section 9.10.


 


ARTICLE X.

MISCELLANEOUS


 


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


 


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instance and
for the specific purpose for which given; provided, however, that
no such amendment, waiver or consent shall:


 


(a)                           waive any condition set
forth in Section 4.01 without the written consent of each Lender;


 


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


 


(c)                            postpone any date fixed by
this Agreement or any other Loan Document for any scheduled payment or
prepayment of principal, interest, fees or other amounts due to the Lenders (or
any of them) or any mandatory reduction of the Aggregate Commitments hereunder
or under any other Loan Document without the written consent of each Lender
directly affected thereby;


 


(d)                           reduce the principal of, or
the rate of interest specified herein on, any Loan or L/C Borrowing, or
(subject to clause (v) of the second proviso to this Section 10.01)
any fees or other amounts payable hereunder or under any other Loan Document,
or change the manner of computation of the Consolidated Senior Leverage Ratio (including
any change in any applicable defined term) that would result in a reduction of
any interest rate on any Loan or any fee payable hereunder without the written
consent of each Lender directly affected thereby; provided, however,
that only the consent of the Required Lenders shall be necessary (i) to amend
the definition of “Default Rate” or to waive any obligation of the Borrower to
pay interest or Letter of Credit Fees at the Default Rate or (ii) to amend any
financial covenant hereunder (or any defined term used therein) even if the
effect of such amendment would be to reduce the rate of interest on any Loan or
L/C Borrowing or to reduce any fee payable hereunder;


 


(e)                            change Section 2.13
or Section 8.03 in a manner that would alter the pro rata sharing
of payments required thereby without the written consent of each Lender;


 


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


 


(g)                            release all or
substantially all of the value of the Guaranty without the written consent of
each Lender, except as provided in Section 9.10; or


 


(h)                           release all or substantially
all of the Collateral in any transaction or series of related transactions
without the written consent of each Lender, except as provided in Section
9.10;


 


and, provided  further, that (i) no amendment, waiver or
consent shall, unless in writing and signed by the L/C Issuer in addition to
the Lenders required above, affect the rights or duties of the L/C Issuer under
this Agreement or any Issuer Document relating to any Letter of Credit issued
or to be issued by it; (ii) no amendment, waiver or consent shall, unless in
writing and signed by the Administrative Agent in addition to the Lenders
required above, affect the rights or 


 


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duties of the Administrative Agent under this Agreement or any other
Loan Document; (iii)
Section 10.06(h) may not be amended, waived or otherwise modified
without the consent of each Granting Lender all or any part of whose Loans are
being funded by an SPC at the time of such amendment, waiver or other
modification; (iv) no amendment, waiver or consent shall, unless in
writing and signed by each Approved Counterparty and each Lender Counterparty
in addition to the Lenders required above, amend the provisions of Clause
FOURTH of Section 8.03; and
(v) the Fee Letter may be amended, or rights or privileges thereunder
waived, in a writing executed only by the parties thereto.  Notwithstanding anything to the contrary
herein, no Defaulting Lender shall have any right to approve or disapprove any
amendment, waiver or consent hereunder, except that the Commitment of such
Lender may not be increased or extended without the consent of such Lender.


 


10.02                 Notices;
Effectiveness; Electronic Communication.


 


(a)                           Notices Generally.  Except
in the case of notices and other communications
expressly permitted to be given by telephone (and except as provided in subsection
(b) below), all notices and other communications provided for herein shall be
in writing and shall be delivered by hand or overnight courier service, mailed
by certified or registered mail or sent by telecopier as follows, and all
notices and other communications expressly permitted hereunder to be given by
telephone shall be made to the applicable telephone number, as follows:


 


(i)                                           if to the
Borrower, the Administrative Agent, or the L/C Issuer, to the address,
telecopier number, electronic mail address or telephone number specified for
such Person on Schedule 10.02; and


 


(ii)                                        if to any other
Lender, to the address, telecopier number, electronic mail address or telephone
number specified in its Administrative Questionnaire.


 


Notices sent by hand or overnight courier service, or mailed by
certified or registered mail, shall be deemed to have been given when received;
notices sent by telecopier shall be deemed to have been given when sent (except
that, if not given during normal business hours for the recipient, shall be
deemed to have been given at the opening of business on the next business day
for the recipient).  Notices delivered
through electronic communications to the extent provided in subsection (b)
below, shall be effective as provided in such subsection (b).


 


(b)                           Electronic Communications.  Notices
and other communications to the Lenders and the L/C Issuer hereunder may be
delivered or furnished by electronic communication (including e-mail and
Internet or intranet websites) pursuant to procedures approved by the
Administrative Agent, provided that the foregoing shall not apply to
notices to any Lender or the L/C Issuer pursuant to Article II if such
Lender or the L/C Issuer, as applicable, has notified the Administrative Agent
that it is incapable of receiving notices under such Article by electronic
communication.  The Administrative Agent
or the Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it, provided that approval of such procedures may
be limited to particular notices or communications.


 


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Unless the Administrative Agent otherwise
prescribes, (i) notices and other communications sent to an e-mail address
shall be deemed received upon the sender’s receipt of an acknowledgement from
the intended recipient (such as by the “return receipt requested” function, as
available, return e-mail or other written acknowledgement), provided
that if such notice or other communication is not sent during the normal
business hours of the recipient, such notice or communication shall be deemed
to have been sent at the opening of business on the next business day for the
recipient, and (ii) notices or communications posted to an Internet or
intranet website shall be deemed received upon the deemed receipt by the
intended recipient at its e-mail address as described in the foregoing
clause (i) of notification that such notice or communication is available
and identifying the website address therefor.


 


(c)                            The Platform.  THE
PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.”  THE AGENT PARTIES (AS DEFINED BELOW) DO NOT
WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY
OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS
FROM THE BORROWER MATERIALS.  NO WARRANTY
OR ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY
RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT
PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM.  In no event shall the Administrative Agent or
any of its Related Parties (collectively, the “Agent Parties”) have any
liability to the Borrower, any Lender, the L/C Issuer or any other Person for
losses, claims, damages, liabilities or expenses of any kind (whether in tort,
contract or otherwise) arising out of the Borrower’s or the Administrative
Agent’s transmission of Borrower Materials through the Internet, except to the
extent that such losses, claims, damages, liabilities or expenses are
determined by a court of competent jurisdiction by a final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of
such Agent Party; provided, however, that in no event shall any
Agent Party have any liability to the Borrower, any Lender, the L/C Issuer or
any other Person for indirect, special, incidental, consequential or punitive
damages (as opposed to direct or actual damages).


 


(d)                           Change of Address, Etc.  Each
of the Borrower, the Administrative Agent, and the L/C Issuer may change its
address, telecopier or telephone number for notices and other communications
hereunder by notice to the other parties hereto.  Each other Lender may change its address,
telecopier or telephone number for notices and other communications hereunder
by notice to the Borrower, the Administrative Agent, and the L/C Issuer.  In addition, each Lender agrees to notify the
Administrative Agent from time to time to ensure that the Administrative Agent
has on record (i) an effective address, contact name, telephone number,
telecopier number and electronic mail address to which notices and other
communications may be sent and (ii) accurate wire instructions for such Lender.


 


(e)                            Reliance by
Administrative Agent, L/C Issuer and Lenders.  The Administrative
Agent, the L/C Issuer and the Lenders shall be entitled to rely and act upon
any notices (including telephonic Loan Notices) purportedly given by or on
behalf of the Borrower even if (i) such notices were not made in a manner
specified herein, were incomplete or were not preceded or followed by any other
form of notice specified herein, or (ii) the terms thereof, as 


 


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understood by the recipient, varied from any confirmation thereof.  The Borrower shall indemnify the
Administrative Agent, the L/C Issuer, each Lender and the Related Parties of
each of them from all losses, costs, expenses and liabilities resulting from
the reliance by such Person on each notice purportedly given by or on behalf of
the Borrower.  All telephonic notices to
and other telephonic communications with the Administrative Agent may be
recorded by the Administrative Agent, and each of the parties hereto hereby
consents to such recording.


 


10.03                 No Waiver;
Cumulative Remedies.  No failure by any Lender, the L/C Issuer or
the Administrative Agent to exercise, and no delay by any such Person in exercising,
any right, remedy, power or privilege hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power
or privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege.  The rights, remedies, powers and privileges
herein provided are cumulative and not exclusive of any rights, remedies,
powers and privileges provided by law.


 


10.04                 Expenses;
Indemnity; Damage Waiver.


 


(a)                           Costs and Expenses.  The
Borrower shall pay (i) all reasonable out-of-pocket expenses
incurred by the Administrative Agent and its Affiliates (including the
reasonable fees, charges and disbursements of counsel for the Administrative
Agent), in connection with the syndication of the credit facilities provided
for herein, the preparation, negotiation, execution, delivery and
administration of this Agreement and the other Loan Documents or any
amendments, modifications or waivers of the provisions hereof or thereof (whether
or not the transactions contemplated hereby or thereby shall be consummated),
(ii) all reasonable out-of-pocket expenses incurred by the L/C
Issuer in connection with the issuance, amendment, renewal or extension of any
Letter of Credit or any demand for payment thereunder and (iii) all out-of-pocket
expenses incurred by the Administrative Agent, any Lender or the L/C Issuer
(including the fees, charges and disbursements of any counsel for the
Administrative Agent, any Lender or the L/C Issuer), in connection with the
enforcement or protection of its rights (A) in connection with this
Agreement and the other Loan Documents, including its rights under this
Section, or (B) in connection with the Loans made or Letters of Credit
issued hereunder, including all such out-of-pocket expenses
incurred during any workout, restructuring or negotiations in respect of such
Loans or Letters of Credit.


 


(b)                           Indemnification by the
Borrower.  The Borrower shall indemnify the Administrative Agent
(and any sub-agent thereof), each Lender and the L/C Issuer, and each Related
Party of any of the foregoing Persons (each such Person being called an “Indemnitee”)
against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses (including the fees, charges and
disbursements of any counsel for any Indemnitee), incurred by any Indemnitee or
asserted against any Indemnitee by any third party or by the Borrower or any
other Loan Party arising out of, in connection with, or as a result of
(i) the execution or delivery of this Agreement, any other Loan Document
or any agreement or instrument contemplated hereby or thereby, the performance
by the parties hereto of their respective obligations hereunder or thereunder,
or the consummation of the transactions contemplated hereby or thereby, or in
the case of the Administrative Agent (and any sub-agent thereof) and its
Related Parties only, the administration of this Agreement and the other Loan
Documents, (ii) any Loan or Letter of Credit or the use or proposed use of
the proceeds 


 


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therefrom (including any refusal by the L/C Issuer to honor a demand
for payment under a Letter of Credit if the documents presented in connection
with such demand do not strictly comply with the terms of such Letter of
Credit), (iii) any actual or alleged presence or release of Hazardous
Materials on or from any property owned or operated by the Borrower or any of
its Subsidiaries, or any Environmental Liability related in any way to the
Borrower or any of its Subsidiaries, or (iv) any actual or prospective
claim, litigation, investigation or proceeding relating to any of the
foregoing, whether based on contract, tort or any other theory, whether brought
by a third party or by the Borrower or any other Loan Party, and regardless of
whether any Indemnitee is a party thereto, in all cases, whether or not caused
by or arising, in whole or in part, out of the comparative, contributory or
sole negligence of the Indemnitee; provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses (x) are
determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of
such Indemnitee or (y) result from a claim brought by the Borrower or any
other Loan Party against an Indemnitee for breach in bad faith of such
Indemnitee’s obligations hereunder or under any other Loan Document, if the
Borrower or such Loan Party has obtained a final and nonappealable judgment in
its favor on such claim as determined by a court of competent jurisdiction.


 


(c)                            Reimbursement by Lenders.  To
the extent that the Borrower for any reason fails to indefeasibly pay any
amount required under subsection (a) or (b) of this Section to be
paid by it to the Administrative Agent (or any sub-agent thereof), the L/C
Issuer or any Related Party of any of the foregoing, each Lender severally
agrees to pay to the Administrative Agent (or any such sub-agent), the L/C
Issuer or such Related Party, as the case may be, such Lender’s Applicable
Percentage (determined as of the time that the applicable unreimbursed expense
or indemnity payment is sought) of such unpaid amount, provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the
Administrative Agent (or any such sub-agent) or the L/C Issuer in its capacity
as such, or against any Related Party of any of the foregoing acting for the Administrative
Agent (or any such sub-agent) or L/C Issuer in connection with such
capacity.  The obligations of the Lenders
under this subsection (c) are subject to the provisions of Section 2.12(c).


 


(d)                           Waiver of Consequential
Damages, Etc.  To the fullest extent permitted by applicable Law,
the Borrower shall not assert, and hereby waives, any claim against any
Indemnitee, on any theory of liability, for special, indirect, consequential or
punitive damages (as opposed to direct or actual damages) arising out of, in
connection with, or as a result of, this Agreement, any other Loan Document or
any agreement or instrument contemplated hereby, the transactions contemplated
hereby or thereby, any Loan or Letter of Credit or the use of the proceeds
thereof.  No Indemnitee referred to in
subsection (b) above shall be liable for any damages arising from the use
by unintended recipients of any information or other materials distributed by
it through telecommunications, electronic or other information transmission systems
in connection with this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby in the absence of its own gross
negligence or willful misconduct.


 


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(e)                            Payments.  All
amounts due under this Section shall be payable not later than ten Business
Days after demand therefor; provided such demand shall be accompanied by
a reasonably detailed invoice outlining the costs and expenses to be reimbursed.


 


(f)                             Survival.  The
agreements in this Section shall survive the resignation of the Administrative
Agent and the L/C Issuer, the
replacement of any Lender, the termination of the Aggregate Commitments and the
repayment, satisfaction or discharge of all the other Obligations and Secured Hedging
Obligations.


 


10.05                 Payments Set
Aside.  To the extent that any payment by or on behalf of the
Borrower is made to the Administrative Agent, the L/C Issuer or any Lender, or
the Administrative Agent, the L/C Issuer or any Lender exercises its right of
setoff, and such payment or the proceeds of such setoff or any part thereof is
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required (including pursuant to any settlement entered into by the
Administrative Agent, the L/C Issuer or such Lender in its discretion) to be
repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of
such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such setoff had not occurred, and (b) each Lender
and the L/C Issuer severally agrees to pay to the Administrative Agent upon
demand its applicable share (without duplication) of any amount so recovered
from or repaid by the Administrative Agent, plus interest thereon from the date
of such demand to the date such payment is made at a rate per annum equal to
the Federal Funds Rate from time to time in effect.  The obligations of the Lenders and the L/C
Issuer under clause (b) of the preceding sentence shall survive the payment in
full of the Obligations and the termination of this Agreement.


 


10.06                 Successors and
Assigns.


 


(a)                           Successors and Assigns
Generally.  The provisions of this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns permitted hereby, except that (other than pursuant to a
transaction permitted by Section 7.04) neither
the Borrower nor any other Loan Party may assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent of
the Administrative Agent and each Lender and no Lender may assign or otherwise
transfer any of its rights or obligations hereunder except (i) to an Eligible
Assignee in accordance with the provisions of subsection (b) of this Section,
(ii) by way of participation in accordance with the provisions of subsection
(d) of this Section, (iii) by way of pledge or assignment of a security
interest subject to the restrictions of subsection (f) of this Section, or (iv)
to an SPC in accordance with the provisions of subsection (h) of this Section (and
any other attempted assignment or transfer by any party hereto shall be null
and void).  Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby,
Participants to the extent provided in subsection (d) of this Section and, to
the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent, the L/C Issuer and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.


 


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(b)                           Assignments by Lenders.  Any Lender may at any time assign to one or
more Eligible Assignees all or a portion of its rights and obligations under
this Agreement (including all or a portion of its Commitment and the Loans
(including for purposes of this subsection (b), participations in L/C
Obligations) at the time owing to it); provided that


 


(i)                                           except in
the case of an assignment of the entire remaining amount of the assigning
Lender’s Commitment and the Loans at the time owing to it or in the case of an
assignment to a Lender or an Affiliate of a Lender or an Approved Fund with
respect to a Lender, the aggregate amount of the Commitment (which for this
purpose includes Loans outstanding thereunder) or, if the Commitment is not
then in effect, the principal outstanding balance of the Loans of the assigning
Lender subject to each such assignment, determined as of the date the
Assignment and Assumption with respect to such assignment is delivered to the
Administrative Agent or, if “Trade Date” is specified in the Assignment and
Assumption, as of the Trade Date, shall not be less than $5,000,000 unless each of the Administrative Agent and, so long as no
Event of Default has occurred and is continuing, the Borrower otherwise
consents (each such consent not to be unreasonably withheld or delayed); provided,
however, that concurrent assignments to members of an Assignee Group and
concurrent assignments from members of an Assignee Group to a single Eligible
Assignee (or to an Eligible Assignee and members of its Assignee Group) will be
treated as a single assignment for purposes of determining whether such minimum
amount has been met;


 


(ii)                                        each partial
assignment shall be made as an assignment of a proportionate part of all the
assigning Lender’s rights and obligations under this Agreement with respect to
the Loans or the Commitment assigned;


 


(iii)                                     any assignment of
a Commitment must be approved by the Administrative Agent and the L/C Issuer (each
such approval not to be unreasonably withheld), unless the Person that is the
proposed assignee is itself a Lender (whether or not the proposed assignee
would otherwise qualify as an Eligible Assignee); and


 


(iv)                                    the parties to each
assignment shall execute and deliver to the Administrative Agent an Assignment
and Assumption, together with a processing and recordation fee in the amount,
if any, required as set forth in Schedule 10.06 and the Eligible Assignee, if
it shall not be a Lender, shall deliver to the Administrative Agent an
Administrative Questionnaire.


 


Subject to acceptance and recording thereof by the Administrative Agent
pursuant to subsection (c) of this Section, from and after the effective date
specified in each Assignment and Assumption, the Eligible Assignee thereunder
shall be a party to this Agreement and, to the extent of the interest assigned
by such Assignment and Assumption, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the extent
of the interest assigned by such Assignment and Assumption, be released from
its obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender’s rights and obligations under
this Agreement, such Lender shall cease to be a party hereto) but shall
continue to be entitled to the benefits of Sections 3.01, 3.04,
3.05, and 10.04 with respect to facts and circumstances
occurring prior to the effective date of


 


88





















 


such assignment.  Upon request,
the Borrower (at its expense) shall execute and deliver a Note to the assignee
Lender.  Any assignment or transfer by a
Lender of rights or obligations under this Agreement that does not comply with
this subsection shall be treated for purposes of this Agreement as a sale by
such Lender of a participation in such rights and obligations in accordance
with subsection (d) of this Section.


 


(c)                            Register.  The
Administrative Agent, acting solely for this purpose as an agent of the
Borrower, shall maintain at the Administrative Agent’s Office a copy of each
Assignment and Assumption delivered to it and a register for the recordation of
the names and addresses of the Lenders, and the Commitments of, and principal amounts
of the Loans and L/C Obligations owing to, each Lender pursuant to the terms
hereof from time to time (the “Register”).  The entries in the Register shall be
conclusive, and the Borrower, the Administrative Agent and the Lenders may
treat each Person whose name is recorded in the Register pursuant to the terms
hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. 
The Register shall be available for inspection by each of the Borrower
and the L/C Issuer at any reasonable time and from time to time upon reasonable
prior notice.  In addition, at any time
that a request for a consent for a material or substantive change to the Loan
Documents is pending, any Lender may request and receive from the Administrative
Agent a copy of the Register.


 


(d)                           Participations.  Any
Lender may at any time, without the consent of, or notice to, the Borrower or
the Administrative Agent, sell participations to any Person (other than a
natural person or the Borrower or any of the Borrower’s Affiliates or
Subsidiaries) (each, a “Participant”) in all or a portion of such Lender’s
rights and/or obligations under this Agreement (including all or a portion of
its Commitment and/or the Loans (including such Lender’s participations in L/C
Obligations) owing to it); provided that (i) such Lender’s
obligations under this Agreement shall remain unchanged, (ii) such Lender
shall remain solely responsible to the other parties hereto for the performance
of such obligations and (iii) the Borrower, the Administrative Agent, the
Lenders and the L/C Issuer shall continue to deal solely and directly with such
Lender in connection with such Lender’s rights and obligations under this
Agreement.


 


Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any  provision
of this Agreement; provided that such agreement or instrument may provide
that such Lender will not, without the consent of the Participant, agree to any
amendment, waiver or other modification described in the first proviso to Section 10.01
that affects such Participant.  Subject
to subsection (e) of this Section, the Borrower agrees that each Participant
shall be entitled to the benefits of Sections 3.01, 3.04 and
3.05 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to subsection (b)
of this Section.  To the extent permitted
by law, each Participant also shall be entitled to the benefits of Section 10.08 as though it were a Lender, provided such
Participant agrees to be subject to Section 2.13 as though it were
a Lender.


 


(e)                            Limitations upon
Participant Rights.  A Participant shall not be entitled to
receive any greater payment under Section 3.01 or 3.04 than the applicable Lender would have been entitled to
receive with respect to the participation sold to such Participant, unless the
sale 


 


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of the participation to such Participant is made with the Borrower’s
prior written consent.  A Participant
that would be a Foreign Lender if it were a Lender shall not be entitled to the
benefits of Section 3.01 unless the Borrower is notified of the
participation sold to such Participant and provided with all information
required to be included in the Register and such Participant agrees, for the
benefit of the Borrower, to comply with Section 3.01(e) as though
it were a Lender.


 


(f)                             Certain Pledges.  Any
Lender may at any time pledge or assign a security interest in all or any
portion of its rights under this Agreement (including under its Note, if any)
to secure obligations of such Lender, including any pledge or assignment to
secure obligations to a Federal Reserve Bank; provided that no such
pledge or assignment shall release such Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.


 


(g)                            Electronic Execution of
Assignments.  The words “execution,” “signed,” “signature,” and
words of like import in any Assignment and Assumption shall be deemed to
include electronic signatures or the keeping of records in electronic form,
each of which shall be of the same legal effect, validity or enforceability as
a manually executed signature or the use of a paper-based recordkeeping system,
as the case may be, to the extent and as provided for in any applicable Law,
including the Federal Electronic Signatures in Global and National Commerce
Act, the New York State Electronic Signatures and Records Act, or any other
similar state laws based on the Uniform Electronic Transactions Act.


 


(h)                           Special Purpose Funding
Vehicles.  Notwithstanding anything to the contrary contained
herein, any Lender (a “Granting Lender”) may grant to a special purpose
funding vehicle identified as such in writing from time to time by the Granting
Lender to the Administrative Agent and the Borrower (an “SPC”) the
option to provide all or any part of any Loan that such Granting Lender would
otherwise be obligated to make pursuant to this Agreement; provided that
(i) nothing herein shall constitute a commitment by any SPC to fund any Loan,
and (ii) if an SPC elects not to exercise such option or otherwise fails to
make all or any part of such Loan, the Granting Lender shall be obligated to
make such Loan pursuant to the terms hereof or, if it fails to do so, to make
such payment to the Administrative Agent as is required under Section 2.12(b)(ii).  Each party hereto hereby agrees that (i)
neither the grant to any SPC nor the exercise by any SPC of such option shall
increase the costs or expenses or otherwise increase or change the obligations
of the Borrower under this Agreement (including its obligations under Section 3.04),
(ii) no SPC shall be liable for any indemnity or similar payment obligation
under this Agreement for which a Lender would be liable, and (iii) the Granting
Lender shall for all purposes, including the approval of any amendment, waiver
or other modification of any provision of any Loan Document, remain the lender
of record hereunder.  The making of a Loan
by an SPC hereunder shall utilize the Commitment of the Granting Lender to the
same extent, and as if, such Loan were made by such Granting Lender.  In furtherance of the foregoing, each party
hereto hereby agrees (which agreement shall survive the termination of this
Agreement) that, prior to the date that is one year and one day after the
payment in full of all outstanding commercial paper or other senior debt of any
SPC, it will not institute against, or join any other Person in instituting
against, such SPC any bankruptcy, reorganization, arrangement, insolvency, or
liquidation proceeding under the laws of the United States or any State
thereof.  Notwithstanding anything to the
contrary contained herein, any SPC 


 


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may (i) with notice to, but without prior consent of the Borrower and
the Administrative Agent and with the payment of a processing fee in the amount
of $3,500, assign all or any portion of its right to receive payment with
respect to any Loan to the Granting Lender and (ii) disclose on a confidential
basis any non-public information relating to its funding of Loans to any rating
agency, commercial paper dealer or provider of any surety or guarantee or
credit or liquidity enhancement to such SPC.


 


(i)                               Resignation as L/C
Issuer after Assignment.  Notwithstanding
anything to the contrary contained herein, if at any time Bank of America
assigns all of its Commitment and Loans pursuant to subsection (b) above, Bank
of America may, upon 30 days’ notice to the Borrower and the Lenders, resign as
L/C Issuer.  In the event of any such
resignation as L/C Issuer, the Borrower shall be entitled to appoint from among
the Lenders a successor L/C Issuer hereunder; provided, however,
that no failure by the Borrower to appoint any such successor shall affect the
resignation of Bank of America as L/C Issuer. 
If Bank of America resigns as L/C Issuer, it shall retain all the rights,
powers, privileges and duties of the L/C Issuer hereunder with respect to all
Letters of Credit outstanding as of the effective date of its resignation as
L/C Issuer and all L/C Obligations with respect thereto (including the right to
require the Lenders to make Base Rate Loans or fund risk participations in
Unreimbursed Amounts pursuant to Section 2.03(c)).  Upon the appointment of a successor L/C
Issuer, (a) such successor shall succeed to and become vested with all of the
rights, powers, privileges and duties of the retiring L/C Issuer, and (b) the
successor L/C Issuer shall issue letters of credit in substitution for the
Letters of Credit, if any, outstanding at the time of such succession or make
other arrangements satisfactory to Bank of America to effectively assume the
obligations of Bank of America with respect to such Letters of Credit.


 


10.07                 Treatment of
Certain Information; Confidentiality.  Each of the Administrative
Agent, the Lenders and the L/C Issuer agrees to maintain the confidentiality of
the Information (as defined below), except that Information may be disclosed
(a) to its Affiliates and to its and its Affiliates’ respective partners,
directors, officers, employees, agents, advisors and representatives (it being
understood that the Persons to whom such disclosure is made will be informed of
the confidential nature of such Information and instructed to keep such
Information confidential), (b) to the extent requested by any regulatory
authority purporting to have jurisdiction over it (including any
self-regulatory authority, such as the National Association of Insurance
Commissioners), (c) to the extent required by applicable Laws or
regulations or by any subpoena or similar legal process, (d) to any other
party hereto, (e) in connection with the exercise of any remedies
hereunder or under any other Loan Document or any action or proceeding relating
to this Agreement or any other Loan Document or the enforcement of rights
hereunder or thereunder, (f) subject to an agreement containing provisions
substantially the same as those of this Section, to (i) any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement or (ii) any actual or
prospective counterparty (or its advisors) to any Hedging Contract relating to
the Borrower and its obligations, (g) with the consent of the Borrower or
(h) to the extent such Information (x) becomes publicly available
other than as a result of a breach of this Section or (y) becomes
available to the Administrative Agent, any Lender, the L/C Issuer or any of
their respective Affiliates on a nonconfidential basis from a source other than
the Borrower.


 


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For purposes of this Section, “Information”
means all information received from the Borrower or any Subsidiary relating to
the Borrower or any Subsidiary or any of their respective businesses, other
than any such information that is available to the Administrative Agent, any
Lender or the L/C Issuer on a nonconfidential basis prior to disclosure by the
Borrower or any Subsidiary, provided that, in the case of information
received from the Borrower or any Subsidiary after the date hereof, such
information is clearly identified at the time of delivery as confidential.  Any Person required to maintain the
confidentiality of Information as provided in this Section shall be considered
to have complied with its obligation to do so if such Person has exercised the
same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.


 


Each of the Administrative Agent, the Lenders
and the L/C Issuer acknowledges that (a) the Information may include material
non-public information concerning the Borrower or a Subsidiary, as the case may
be, (b) it has developed compliance procedures regarding the use of material
non-public information and (c) it will handle such material non-public
information in accordance with applicable Law, including Federal and state
securities Laws.


 


10.08                 Right of Setoff.  If
an Event of Default shall have occurred and be continuing, each Lender, the L/C
Issuer and each of their respective Affiliates is hereby authorized at any time
and from time to time, to the fullest extent permitted by applicable Law, to
set off and apply any and all deposits (general or special, time or demand,
provisional or final, in whatever currency) at any time held and other
obligations (in whatever currency) at any time owing by such Lender, the L/C
Issuer or any such Affiliate to or for the credit or the account of the
Borrower or any other Loan Party
against any and all of the obligations of the Borrower or such Loan Party now or hereafter existing under this Agreement or
any other Loan Document to such Lender or the L/C Issuer, irrespective of
whether or not such Lender or the L/C Issuer shall have made any demand under
this Agreement or any other Loan Document and although such obligations of the
Borrower or such Loan Party may
be contingent or unmatured or are owed to a branch or office of such Lender or
the L/C Issuer different from the branch or office holding such deposit or
obligated on such indebtedness.  The
rights of each Lender, the L/C Issuer and their respective Affiliates under
this Section are in addition to other rights and remedies (including other
rights of setoff) that such Lender, the L/C Issuer or their respective
Affiliates may have.  Each Lender and the
L/C Issuer agrees to notify the Borrower and the Administrative Agent promptly
after any such setoff and application, provided that the failure to give
such notice shall not affect the validity of such setoff and application.


 


The Administrative Agent hereby appoints each
of the L/C Issuer and Lenders to serve as its bailee to perfect the
Administrative Agent’s Liens in any Collateral in the possession of such L/C
Issuer and Lender.  L/C Issuer and each
Lender possessing any Collateral agrees to so act as bailee for the
Administrative Agent in accordance with the terms and provisions hereof.  In furtherance of the forgoing, L/C Issuer
and each Lender acknowledges that certain of the Loan Parties maintain deposit
accounts, securities accounts and commodities accounts with one or more of the
Administrative Agent, L/C Issuer and Lenders (all such accounts maintained by
Loan Parties with one or more of the Administrative Agent, L/C Issuer and
Lenders being herein collectively called the “Lender Party Accounts” and
individually a “Lender Party Account”). 
L/C Issuer and each Lender agrees to hold its Lender Party Accounts as
bailee for the Administrative Agent to perfect the security interest held for
the benefit of the L/C Issuer or a 


 


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Lender therein.  Prior to the receipt by L/C Issuer or a
Lender of notice from the Administrative Agent that it is exercising exclusive
control over any Lender Party Account (a “Notice of Exclusive Control”),
the Loan Parties are entitled to make withdrawals from the Lender Party
Accounts and make deposits into and give entitlement orders with respect to the
Lender Party Accounts.  Once L/C Issuer
or a Lender has a Notice of Exclusive Control, which such notice shall not be
given until an Event of Default has occurred and is continuing, the
Administrative Agent shall be the only party entitled to make withdrawals from
or otherwise give any entitlement order or other direction with respect to the
Lender Party Accounts.  To the extent not
already occurring, L/C Issuer and each Lender agrees to transfer, in
immediately available funds by wire transfer to the Administrative Agent, the
amount of the collected funds credited to the deposit accounts which are Lender
Party Accounts held by such L/C Issuer or Lender, and deliver to the Administrative
Agent all moneys or instruments relating thereto or held therein and any other
Collateral at any time the Administrative Agent demands payment or delivery
thereof after a Notice of Exclusive Control has been delivered to such L/C
Issuer or Lender.  Each Loan Party agrees
that L/C Issuer and each Lender is authorized to immediately deliver all the
Collateral to the Administrative Agent upon the L/C Issuer’s or Lender’s
receipt of a Notice of Exclusive Control from the Administrative Agent.


 


10.09                 Interest Rate
Limitation.  Notwithstanding anything to the contrary contained
in any Loan Document, the interest paid or agreed to be paid under the Loan
Documents shall not exceed the maximum rate of non-usurious interest permitted
by applicable Law (the “Maximum Rate”). 
If the Administrative Agent, L/C Issuer, or any Lender shall receive
interest in an amount that exceeds the Maximum Rate, the excess interest shall
be applied to the principal of the Loans or, if it exceeds such unpaid
principal, refunded to the Borrower.  In
determining whether the interest contracted for, charged, or received by the
Administrative Agent, L/C Issuer or a Lender exceeds the Maximum Rate, such
Person may, to the extent permitted by applicable Law, (a) characterize any
payment that is not principal as an expense, fee, or premium rather than
interest, (b) exclude voluntary prepayments and the effects thereof, and (c)
amortize, prorate, allocate, and spread in equal or unequal parts the total
amount of interest throughout the contemplated term of the Obligations
hereunder.


 


10.10                 Counterparts;
Integration; Effectiveness.  This Agreement may be executed in
counterparts (and by different parties hereto in different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract.  This
Agreement and the other Loan Documents constitute the entire contract among the
parties relating to the subject matter hereof and supersede any and all
previous agreements and understandings, oral or written, relating to the
subject matter hereof.  Except as
provided in Section 4.01, this Agreement shall become effective
when it shall have been executed by the Administrative Agent and when the
Administrative Agent shall have received counterparts hereof that, when taken
together, bear the signatures of each of the other parties hereto.  Delivery of an executed counterpart of a
signature page of this Agreement by telecopy shall be effective as delivery of
a manually executed counterpart of this Agreement.


 


10.11                 Survival of
Representations and Warranties.  All representations and
warranties made hereunder and in any other Loan Document or other document
delivered pursuant hereto or thereto or in connection herewith or therewith
shall survive the execution and delivery hereof and thereof.  Such representations and warranties have been
or will be relied upon by the 


 


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Administrative Agent and each Lender,
regardless of any investigation made by the Administrative Agent or any Lender
or on their behalf and notwithstanding that the Administrative Agent or any
Lender may have had notice or knowledge of any Default at the time of any
Credit Extension, and shall continue in full force and effect as long as any
Loan or any other Obligation hereunder shall remain unpaid or unsatisfied or
any Letter of Credit shall remain outstanding.


 


10.12                 Severability.  If
any provision of this Agreement or the other Loan Documents is held to be
illegal, invalid or unenforceable, (a) the legality, validity and
enforceability of the remaining provisions of this Agreement and the other Loan
Documents shall not be affected or impaired thereby and (b) the parties shall
endeavor in good faith negotiations to replace the illegal, invalid or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the illegal, invalid or unenforceable
provisions.  The invalidity of a
provision in a particular jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.


 


10.13                 Replacement of
Lenders.  If (a) any Lender requests compensation under Section 3.04
or gives notice pursuant to Section 3.02, (b) the Borrower is required
to pay any additional amount to any Lender or any Governmental Authority for
the account of any Lender pursuant to Section 3.01, (c) any Lender
is a Defaulting Lender, (d) any Lender fails to consent to an election,
consent, amendment, waiver or other modification to this Agreement or any other
Loan Document that requires the consent of a greater percentage of the Lenders
than the Required Lenders and such election, consent, amendment, waiver or
other modification is otherwise consented to by the Required Lenders, or (e) if any other circumstance exists
hereunder that gives the Borrower the right to replace a Lender as a party
hereto, then the Borrower may, at its sole expense and effort, upon
notice to such Lender and the Administrative Agent, require such Lender to
assign and delegate, without recourse (in accordance with and subject to the
restrictions contained in, and consents required by, Section 10.06),
all of its interests, rights and obligations under this Agreement and the
related Loan Documents to an assignee that shall assume such obligations (which
assignee may be another Lender, if a Lender accepts such assignment), provided
that:


 


(a)                           the Borrower shall have paid
to the Administrative Agent the assignment fee specified in Section 10.06(b);


 


(b)                           such Lender shall have
received payment of an amount equal to the outstanding principal of its Loans
and L/C Advances, accrued interest thereon, accrued fees and all other amounts
payable to it hereunder and under the other Loan Documents (including any
amounts under Section 3.05) from the assignee (to the extent of
such outstanding principal and accrued interest and fees) or the Borrower (in
the case of all other amounts);


 


(c)                            in the case of any such
assignment resulting from a claim for compensation under Section 3.04
or payments required to be made pursuant to Section 3.01, such
assignment will result in a reduction in such compensation or payments
thereafter; and


 


(d)                           such assignment does not
conflict with applicable Laws.


 


94





















 


A Lender shall not be required to make any
such assignment or delegation if, prior thereto, as a result of a waiver by
such Lender or otherwise, the circumstances entitling the Borrower to require
such assignment and delegation cease to apply.


 


10.14                 Governing Law;
Jurisdiction; Etc.


 


(a)                           GOVERNING LAW.  THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF
THE STATE OF NEW YORK.


 


(b)                           SUBMISSION TO
JURISDICTION.  THE ADMINISTRATIVE AGENT, EACH LENDER, THE L/C
ISSUER, THE BORROWER AND EACH OTHER
LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS
PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW
YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN
DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE
PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN
RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW
YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH
FEDERAL COURT.  EACH OF THE PARTIES
HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT
OR IN ANY OTHER MANNER PROVIDED BY LAW. 
NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY
RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER OR THE L/C ISSUER MAY OTHERWISE
HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT AGAINST THE BORROWER OR
ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY
JURISDICTION.


 


(c)                            WAIVER OF VENUE.  THE
ADMINISTRATIVE AGENT, EACH LENDER, THE L/C ISSUER, THE BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY
AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (b) OF THIS
SECTION.  EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT.


 


(d)                           SERVICE OF PROCESS.  EACH
PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED
FOR NOTICES 


 


95





















 


IN SECTION 10.02. 
NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.


 


10.15                 Waiver of Jury
Trial.  EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT
IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.


 


10.16                 USA PATRIOT Act
Notice.  Each Lender that is subject to the Act (as hereinafter
defined) and the Administrative Agent (for itself and not on behalf of any
Lender) hereby notifies the Borrower that pursuant to the requirements of the
USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “Act”), it is required to obtain, verify and record
information that identifies the Borrower, which information includes the name
and address of the Borrower and other information that will allow such Lender
or the Administrative Agent, as applicable, to identify the Borrower in
accordance with the Act.


 


10.17                 Amendment and
Restatement.  This Agreement amends
and restates in its entirety the Existing Credit Agreement and amends,
restates, renews and extends the obligations and Indebtedness under the
Comerica Credit Facility and the ScissorTail Credit Facility.  The Borrower hereby agrees that (a) the
Indebtedness outstanding under the Existing Credit Agreement and all Loan
Documents (as defined in the Existing Credit Agreement) and all accrued and
unpaid interest thereon, (b) all accrued and unpaid fees under the Existing
Credit Agreement or such other Loan Documents, and (c) the Indebtedness outstanding
under the Comerica Credit Facility and the ScissorTail Credit Facility, shall
be deemed to be outstanding under and governed by this Agreement.  The Borrower hereby acknowledges, represents,
warrants, and agrees that this Agreement is not intended to be, and shall not
be deemed or construed to be, a novation or release of the Existing Credit
Agreement or such other Loan Documents or a novation or release of obligations
and Indebtedness under the Comerica Credit Facility or the ScissorTail Credit
Facility.


 


10.18                 ENTIRE AGREEMENT.  THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. 
THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.


 


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[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]


 


97





















 


IN WITNESS
WHEREOF, the parties hereto have caused this Agreement
to be duly executed as of the date first above written.


 


	
   

  	
  COPANO
  ENERGY, L.L.C.,

  
	
   

  	
  as Borrower

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
  John R. Eckel, Jr.

  
	
   

  	
  Title:

  	
  Chairman of the Board and

  
	
   

  	
   

  	
  Chief Executive Officer

  
						



 


S-1





















 


	
   

  	
  BANK OF
  AMERICA, N.A.,

  
	
   

  	
  as Administrative Agent

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
						



 


S-2





















 


	
   

  	
  BANK OF
  AMERICA, N.A.,

  
	
   

  	
  as a Lender and L/C Issuer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-3





















 


	
   

  	
  COMERICA
  BANK,

  
	
   

  	
  as a Lender and Co-Syndication Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-4





















 


	
   

  	
  U.S. BANK NATIONAL ASSOCIATION,

  
	
   

  	
  as a Lender and Co-Syndication Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-5





















 


	
   

  	
  BANK OF SCOTLAND,

  
	
   

  	
  as a Lender and Co-Documentation Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-6





















 


	
   

  	
  FORTIS CAPITAL CORP.,

  
	
   

  	
  as a Lender and Co-Documentation Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-7





















 


	
   

  	
  ROYAL BANK OF CANADA, as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-8





















 


	
   

  	
  HARRIS NESBITT FINANCING, INC.,

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-9





















 


	
   

  	
  AMEGY BANK NATIONAL ASSOCIATION,

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-10





















 


	
   

  	
  COMPASS BANK, as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-11





















 


	
   

  	
  GUARANTY BANK, as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-12





















 


	
   

  	
  BNP PARIBAS, as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-13





















 


	
   

  	
  DEUTSCHE BANK TRUST COMPANY 

  AMERICAS, as a
  Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-14





















 


	
   

  	
  KEYBANK, NATIONAL ASSOCIATION,

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-15





















 


	
   

  	
  SUNTRUST BANK, as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-16





















 


	
   

  	
  BANK OF TEXAS, N.A., as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-17





















 


	
   

  	
  NATEXIS BANQUES POPULAIRES,

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-18





















 


	
   

  	
  STERLING BANK, as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-19





















 


	
   

  	
  WELLS FARGO BANK, N.A., as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


S-20























 


SCHEDULE 1.01


 


SECURITY SCHEDULE


 


1.       Guaranty
Agreement by each Restricted Subsidiary in favor of Administrative Agent, for
the benefit of itself and the Lenders.


 


2.       Pledge
and Security Agreement.


 


3.       Amended
and Restated Mortgage, Assignment, Security Agreement, Financing Statement and
Fixture Filing by ScissorTail in favor of Administrative Agent, for the benefit
of itself and the Lenders.


 


4.       Amended
and Restated Mortgage, Deed of Trust, Assignment, Security Agreement, Financing
Statement and Fixture Filing by Copano Processing, L.P., in favor of
Administrative Agent, for the benefit of itself and the Lenders.


 


5.       Amended
and Restated Mortgage, Deed of Trust, Assignment, Security Agreement, Financing
Statement and Fixture Filing by Copano NGL Services, L.P. in favor of
Administrative Agent, for the benefit of itself and the Lenders.


 


6.       Amended
and Restated Mortgage, Deed of Trust, Assignment, Security Agreement, Financing
Statement and Fixture Filing by Copano Field Services/Agua Dulce, L.P. in favor
of Administrative Agent, for the benefit of itself and the Lenders.


 


7.       Third
Amended and Restated Mortgage, Deed of Trust, Assignment, Security Agreement,
Financing Statement and Fixture Filing by Copano Field Services/Central Gulf
Coast, L.P. in favor of Administrative Agent, for the benefit of itself and the
Lenders.


 


8.       Amended
and Restated Mortgage, Deed of Trust, Assignment, Security Agreement, Financing
Statement and Fixture Filing by Copano Field Services/Copano Bay, L.P. in favor
of Administrative Agent, for the benefit of itself and the Lenders.


 


9.       Amended
and Restated Mortgage, Deed of Trust, Assignment, Security Agreement, Financing
Statement and Fixture Filing by Copano Field Services/Live Oak, L.P. in favor
of Administrative Agent, for the benefit of itself and the Lenders.


 


10.    Mortgage,
Deed of Trust, Assignment, Security Agreement, Financing Statement and Fixture
Filing by Copano Field Services/Karnes, L.P. in favor of Administrative Agent,
for the benefit of itself and the Lenders.


 


11.    Amended
and Restated Mortgage, Deed of Trust, Assignment, Security Agreement, Financing
Statement and Fixture Filing by Copano Field Services/South Texas, L.P. in
favor of Administrative Agent, for the benefit of itself and the Lenders.


 


12.    Amended
and Restated Mortgage, Deed of Trust, Assignment, Security Agreement, Financing
Statement and Fixture Filing by Copano Field Services/Upper Gulf Coast, L.P. in
favor of Administrative Agent, for the benefit of itself and the Lenders.


 





















 


13.    Amended
and Restated Mortgage, Deed of Trust, Assignment, Security Agreement, Financing
Statement and Fixture Filing by Copano Pipelines/Hebbronville, L.P. in favor of
Administrative Agent, for the benefit of itself and the Lenders.


 


14.    Amended
and Restated Mortgage, Deed of Trust, Assignment, Security Agreement, Financing
Statement and Fixture Filing by Copano Pipelines/South Texas, L.P. in favor of
Administrative Agent, for the benefit of itself and the Lenders.


 


15.    Amended
and Restated Mortgage, Deed of Trust, Assignment, Security Agreement, Financing
Statement and Fixture Filing by Copano Pipelines/Upper Gulf Coast, L.P. in
favor of Administrative Agent, for the benefit of itself and the Lenders.


 


16.    UCC-1
Financing Statements naming the Borrower and each Restricted Subsidiary, as
debtors, and Administrative Agent, as secured party, covering all assets and
properties.


 





















 


SCHEDULE 2.01


 


COMMITMENTS

AND APPLICABLE PERCENTAGES


 


	
  Lender

  	
   

  	
  Commitment

  	
   

  	
  Applicable 

  Percentage*

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bank of America, N.A.

  	
   

  	
  $

  	
  27,000,000

  	
   

  	
  7.714286

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Comerica Bank

  	
   

  	
  $

  	
  26,000,000

  	
   

  	
  7.428571

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  U.S. Bank National Association

  	
   

  	
  $

  	
  26,000,000

  	
   

  	
  7.428571

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bank of Scotland

  	
   

  	
  $

  	
  26,000,000

  	
   

  	
  7.428571

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fortis Capital Corp.

  	
   

  	
  $

  	
  26,000,000

  	
   

  	
  7.428571

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Royal Bank of Canada

  	
   

  	
  $

  	
  26,000,000

  	
   

  	
  7.428571

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Harris Nesbitt Financing, Inc.

  	
   

  	
  $

  	
  22,000,000

  	
   

  	
  6.285714

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Amegy Bank National Association

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  5.714286

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Compass Bank

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  5.714286

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Guaranty Bank

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  5.714286

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  BNP Paribas

  	
   

  	
  $

  	
  17,000,000

  	
   

  	
  4.857143

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deutsche Bank Trust Company Americas

  	
   

  	
  $

  	
  17,000,000

  	
   

  	
  4.857143

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Keybank, National Association

  	
   

  	
  $

  	
  17,000,000

  	
   

  	
  4.857143

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SunTrust Bank

  	
   

  	
  $

  	
  17,000,000

  	
   

  	
  4.857143

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bank of Texas, N.A.

  	
   

  	
  $

  	
  15,000,000

  	
   

  	
  4.285714

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Natexis Banques Populaires

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
  2.857143

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sterling Bank

  	
   

  	
  $

  	
  9,000,000

  	
   

  	
  2.571429

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Wells Fargo Bank, N.A.

  	
   

  	
  $

  	
  9,000,000

  	
   

  	
  2.571429

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
  $

  	
  350,000,000

  	
   

  	
  100.000000

  	
  %

  



 










*Rounded to six decimal places


 





















 


SCHEDULE 5.05


 


SUPPLEMENT TO INTERIM FINANCIAL STATEMENTS


 





















 


SCHEDULE 5.09


 


ENVIRONMENTAL MATTERS


 





















 


SCHEDULE 5.13


 


SUBSIDIARIES AND

OTHER EQUITY INVESTMENTS


 


Part (a).          Subsidiaries.


 


Part (b).          Other
Equity Investments.


 





















 


SCHEDULE 7.01


 


EXISTING LIENS


 





















 


SCHEDULE 7.03


 


EXISTING INDEBTEDNESS


 





















 


SCHEDULE 10.02


 


ADMINISTRATIVE AGENT’S OFFICE;

CERTAIN ADDRESSES FOR NOTICES


 


BORROWER:


 


2727
Allen Parkway, Suite 1200

Houston, Texas 77019


Attention:
Matt Assiff

Telephone: 713-621-9547

Telecopier: 713-621-9545

Electronic Mail: matt.assiff@copanoenergy.com

Website Address: www.copanoenergy.com


 


 


ADMINISTRATIVE
AGENT:


 


Administrative Agent’s Office
(daily borrowing/repaying activity):

Bank of America, N.A.


Charlotte, NC

Attention:  Duane Lathan

Telephone:  (704) 388-9102

Telecopier:  (704) 409-0111


 


Wire Instructions:


Bank of America, N.A.


ABA# 026-009-593

Account No.:  136-621-225-0600


Attn: Credit Services


Ref:  Copano Energy

ABA# 026-009-593


 


Agengy Management (financial reporting/bank group communication):
Bank of America, N.A.

100 Federal Street

Mail Code: MA5-100-11-02

Boston, Massachusetts  02110

Attention:  Todd Mac Neill

Telephone:  (617) 434-6842

Telecopier:  (617) 790-1361

Electronic Mail:  todd.g.macneill@BankofAmerica.com


 





















 


L/C ISSUER:


Bank of America, N.A.

Trade Operations – Scranton

1 Fleet Way

Mail Code: PA6-580-02-30

Scranton, PA  18507

Attention:              Al Malave

Telephone:  (570) 330-4210

Telecopier:  (570) 330-4186

Electronic Mail:  alfonso.malave@bankofamerica.com


 


2





















 


SCHEDULE 10.06


 


PROCESSING AND RECORDATION FEES


 


The Administrative Agent will charge a
processing and recordation fee (an “Assignment Fee”) in the amount of $3,500
for each assignment; provided, however, that in the event of two or more
concurrent assignments to members of the same Assignee Group (which may be
effected by a suballocation of an assigned amount among members of the same
Assignee Group) or two or more concurrent assignments by members of the same Assignee
Group to a single Eligible Assignee (or to an Eligible Assignee and members of
its Assignee Group), the Assignee Fee will be $3,500 plus the amount set forth
below:  


 


	
  Transaction

  	
   

  	
  Assignment Fee

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  First four concurrent assignments or
  suballocations to members of an Assignee Group (or from members of an
  Assignee Group, as applicable)

  	
   

  	
  -0-

  	
   

  
	
  Each additional concurrent assignment or
  suballocation to a member of such Assignee Group (or from a member of such
  Assignee Group, as applicable)

  	
   

  	
  $

  	
  500

  	
   

  
					



 





















 


EXHIBIT A


 


FORM OF COMMITTED LOAN NOTICE


 


Date:                      ,       


 


To:          Bank of America, N.A.,
as Administrative Agent


 


Ladies and Gentlemen:


 


Reference is made to that certain Credit
Agreement, dated as of August 1, 2005 (as amended, restated, extended,
supplemented or otherwise modified in writing from time to time, the “Agreement;”
the terms defined therein being used herein as therein defined), among Copano
Energy, L.L.C., a Delaware limited liability company (the “Borrower”),
the Lenders from time to time party thereto, and Bank of America, N.A., as
Administrative Agent and L/C Issuer.


 


The undersigned hereby requests (select one):


 


o  A Borrowing of Loans                  o  A conversion or continuation of Loans


 


1.             On
                                                    
(a Business Day).


 


2.             In
the amount of $                                                    .


 


3.             Comprised
of                                                     

[Type of Loan requested]


 


4.             For
Eurodollar Rate Loans:  with an Interest
Period of                   
months.


 


The Borrowing, if any, requested herein
complies with the provisos to the first sentence of Section 2.01 of
the Agreement.


 


	
   

  	
  COPANO
  ENERGY, L.L.C.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 





















 


EXHIBIT C


 


FORM OF NOTE


 


 


FOR VALUE RECEIVED, the undersigned (the “Borrower”)
hereby promises to pay to                                                  
or registered assigns (the “Lender”), in accordance with the provisions
of the Agreement (as hereinafter defined), the principal amount of each Loan
from time to time made by the Lender to the Borrower under that certain Credit
Agreement, dated as of August 1, 2005 (as amended, restated, extended,
supplemented or otherwise modified in writing from time to time, the “Agreement;”
the terms defined therein being used herein as therein defined), among the
Borrower, the Lenders and other agents from time to time party thereto, and
Bank of America, N.A., as Administrative Agent and L/C Issuer.


 


The Borrower promises to pay interest on the
unpaid principal amount of each Loan from the date of such Loan until such
principal amount is paid in full, at such interest rates and at such times as
provided in the Agreement.  All payments
of principal and interest shall be made to the Administrative Agent for the
account of the Lender in Dollars in immediately available funds at the
Administrative Agent’s Office.  If any
amount is not paid in full when due hereunder, such unpaid amount shall bear
interest, to be paid upon demand, from the due date thereof until the date of
actual payment (and before as well as after judgment) computed at the per annum
rate set forth in the Agreement.


 


This Note is one of the Notes referred to in
the Agreement, is entitled to the benefits thereof and may be prepaid in whole
or in part subject to the terms and conditions provided therein.  This Note is also entitled to the benefits of
the Guaranty and is secured by the Collateral. 
Upon the occurrence and continuation of one or more of the Events of
Default specified in the Agreement, all amounts then remaining unpaid on this
Note shall become, or may be declared to be, immediately due and payable all as
provided in the Agreement.  Loans made by
the Lender shall be evidenced by one or more loan accounts or records maintained
by the Lender in the ordinary course of business. The Lender may also attach
schedules to this Note and endorse thereon the date, amount and maturity of its
Loans and payments with respect thereto.


 


The Borrower, for itself, its successors and
assigns, hereby waives diligence, presentment, protest and demand and notice of
protest, demand, dishonor and non-payment of this Note.


 





















 


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


 


 


	
   

  	
  COPANO
  ENERGY, L.L.C.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


2





















 


LOANS AND PAYMENTS WITH RESPECT THERETO


 


	
  Date

  	
   

  	
  Type of 

  Loan Made

  	
   

  	
  Amount of 

  Loan Made

  	
   

  	
  End of 

  Interest 

  Period

  	
   

  	
  Amount of 

  Principal or 

  Interest 

  Paid This 

  Date

  	
   

  	
  Outstanding 

  Principal 

  Balance 

  This Date

  	
   

  	
  Notation 

  Made By

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


3





















 


EXHIBIT D


 


FORM OF COMPLIANCE CERTIFICATE


 


Financial
Statement Date:              ,


 


To:          Bank of America, N.A.,
as Administrative Agent


 


Ladies and Gentlemen:


 


Reference is made to that certain Credit
Agreement, dated as of August 1, 2005 (as amended, restated, extended,
supplemented or otherwise modified in writing from time to time, the “Agreement;”
the terms defined therein being used herein as therein defined), among COPANO
ENERGY, L.L.C., a Delaware limited liability company (the “Borrower”),
the Lenders from time to time party thereto, and Bank of America, N.A., as
Administrative Agent and L/C Issuer.


 


The undersigned Responsible Officer hereby
certifies as of the date hereof that he/she is the                                              
of the Borrower, and that, as such, he/she is authorized to execute and deliver
this Certificate to the Administrative Agent on the behalf of the Borrower, and
that:


 


[Use
following paragraph 1 for fiscal year-end
financial statements]


 


1.             Attached
hereto as Schedule 1 are the year-end audited financial statements
required by Section 6.01(a) of the Agreement for the fiscal year of
the Borrower ended as of the above date, together with the report and opinion
of a Registered Public Accounting Firm required by such section.


 


[Use following paragraph 1 for fiscal quarter-end
financial statements]


 


1.             Attached hereto as Schedule
1 are the unaudited financial statements required by Section 6.01(b)
of the Agreement for the fiscal quarter of the Borrower ended as of the above
date.  Such financial statements fairly
present in all material respects the financial condition, results of operations
and cash flows of the Borrower and its Subsidiaries in accordance with GAAP as
at such date and for such period, subject only to normal year-end audit
adjustments and the absence of footnotes.


 


2.             The undersigned has
reviewed and is familiar with the terms of the Agreement and has made, or has
caused to be made under his/her supervision, a detailed review of the
transactions and condition (financial or otherwise) of the Borrower during the
accounting period covered by the attached financial statements.


 


3.             A review of the
activities of the Borrower during such fiscal period has been made under the
supervision of the undersigned with a view to determining whether during such
fiscal period the Borrower performed and observed all its Obligations under the
Loan Documents, and


 





















 


[select one:]


[to the knowledge of the undersigned after
due inquiry during such fiscal period, the Borrower performed and observed each
covenant and condition of the Loan Documents applicable to it, and no Default
has occurred and is continuing.]


 


—or—


[the following covenants or conditions have
not been performed or observed and the following is a list of each such Default
and its nature and status:]


 


1.             The representations
and warranties of the Borrower contained in Article V of the Agreement,
and any representations and warranties of the Borrower that are contained in any document furnished at any time under
or in connection with the Loan Documents, are true and correct in all material
respects on and as of the date hereof, except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they are true and correct in all material respects as of such earlier
date, and except that for purposes of this Compliance Certificate, the
representations and warranties contained in subsections (a) and (b) of Section 5.05
of the Agreement shall be deemed to refer to the most recent statements
furnished pursuant to clauses (a) and (b), respectively, of Section 6.01
of the Agreement, including the statements in connection with which this
Compliance Certificate is delivered.


 


2.             The financial
covenant analyses and information set forth on Schedule 2 attached
hereto are true and accurate in all material respects on and as of the date of
this Certificate.


 


IN WITNESS WHEREOF,
the undersigned has executed this Certificate as of
                                                                           ,
                         .


 


	
   

  	
  COPANO
  ENERGY, L.L.C.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 


2





















 


 


For the
Quarter/Year ended                                   (“Statement
Date”)


 


SCHEDULE 2
to the Compliance Certificate

($ in 000’s)


 


	
  I.

  	
   

  	
  Section 7.21(a) – Fixed Charge Coverage Ratio.

  
	
   

  	
   

  	
   

  
	
  II.

  	
   

  	
  Section 7.21(b) – Consolidated Interest Coverage Ratio.

  
	
   

  	
   

  	
   

  
	
  III.

  	
   

  	
  Section 7.21(c) – Consolidated Senior Leverage Ratio.

  
	
   

  	
   

  	
   

  
	
  IV.

  	
   

  	
  Section 7.21(d) – Consolidated Total Leverage Ratio.

  



 


3





















 


For the
Quarter/Year ended                                   (“Statement
Date”)


 


SCHEDULE 3
to the Compliance Certificate

($ in 000’s)


 


Consolidated
EBITDA
(in accordance with the definition of Consolidated
EBITDA

as set forth in the Agreement)


 


	
  Consolidated 

  EBITDA

  	
   

  	
  Quarter 

  Ended 

  	
   

  	
  Quarter 

  Ended 

  	
   

  	
  Quarter 

  Ended 

  	
   

  	
  Quarter 

  Ended 

  	
   

  	
  Twelve 

  Months 

  Ended 

  	
   

  
	
  Net Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  + distributions received

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  - equity earnings

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  + equity losses

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  = Consolidated Net Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  + Consolidated Interest Charges

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  + income taxes

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  + depreciation and amortization expense

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  + non-cash expenses

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  - income tax credits

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  - non-cash income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  = Consolidated EBITDA

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


4





















 


EXHIBIT E


 


ASSIGNMENT AND ASSUMPTION


 


This Assignment and Assumption (this “Assignment
and Assumption”) is dated as of the Effective Date set forth below and is
entered into by and between [Insert name of Assignor]
(the “Assignor”) and [Insert name of Assignee]
(the “Assignee”).  Capitalized
terms used but not defined herein shall have the meanings given to them in the
Credit Agreement identified below (the “Credit Agreement”), receipt of a
copy of which is hereby acknowledged by the Assignee.  The Standard Terms and Conditions set forth
in Annex 1 attached hereto are hereby agreed to and incorporated herein by
reference and made a part of this Assignment and Assumption as if set forth
herein in full.


 


For an agreed consideration, the Assignor
hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby
irrevocably purchases and assumes from the Assignor, subject to and in
accordance with the Standard Terms and Conditions and the Credit Agreement, as
of the Effective Date inserted by the Administrative Agent as contemplated
below (i) all of the Assignor’s rights and obligations as a Lender under the
Credit Agreement and any other documents or instruments delivered pursuant
thereto to the extent related to the amount and percentage interest identified
below of all of such outstanding rights and obligations of the Assignor under
the respective facilities identified below (including, without limitation, the
Letters of Credit included in such facilities) and (ii) to the extent permitted
to be assigned under applicable law, all claims, suits, causes of action and
any other right of the Assignor (in its capacity as a Lender) against any
Person, whether known or unknown, arising under or in connection with the
Credit Agreement, any other documents or instruments delivered pursuant thereto
or the loan transactions governed thereby or in any way based on or related to
any of the foregoing, including, but not limited to, contract claims, tort
claims, malpractice claims, statutory claims and all other claims at law or in
equity related to the rights and obligations sold and assigned pursuant to
clause (i) above (the rights and obligations sold and assigned pursuant to clauses
(i) and (ii) above being referred to herein collectively as, the “Assigned
Interest”).  Such sale and assignment
is without recourse to the Assignor and, except as expressly provided in this
Assignment and Assumption, without representation or warranty by the Assignor.


 


1.             Assignor:                                                                          


 


2.             Assignee:                                                                          
[and is an Affiliate/Approved Fund of [identify Lender]]


 


3.             Borrower:              Copano
Energy, L.L.C.


 


4.             Administrative
Agent: Bank of America, N.A., as the administrative agent under the Credit
Agreement


 


5.             Credit
Agreement:               Credit Agreement,
dated as of August 1, 2005, among Copano Energy, L.L.C., the Lenders from time
to time party thereto, and Bank
of America, N.A., as Administrative Agent and L/C Issuer


 





















 


6.             Assigned
Interest:


 


	
  Facility Assigned

  	
   

  	
  Aggregate 

  Amount of

  Commitment/Loans 

  for all Lenders*

  	
   

  	
  Amount of 

  Commitment/Loans

  Assigned*

  	
   

  	
  Percentage 

  Assigned of 

  Commitment/Loans

  	
   

  	
  CUSIP Number

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


[7.           Trade
Date:                                                    ]


 


Effective Date:                                  ,
20     [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH
SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER
THEREFOR.]


 


The terms set forth in this Assignment and
Assumption are hereby agreed to:


 


2





















 


	
   

  	
  ASSIGNOR

  	
   

  
	
   

  	
  [NAME OF ASSIGNOR]

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  



 


 


	
   

  	
  ASSIGNEE

  	
   

  
	
   

  	
  [NAME OF ASSIGNEE]

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  



 


[Consented to and] Accepted:


 


BANK OF
AMERICA, N.A., as

Administrative Agent


 


 


	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  



 


[Consented to:]


 


COPANO ENERGY, L.L.C.


 


 


	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  



 


3





















 


ANNEX 1 TO ASSIGNMENT AND ASSUMPTION


 


STANDARD TERMS
AND CONDITIONS FOR


 


ASSIGNMENT AND
ASSUMPTION


 


1.             Representations
and Warranties.


 


1.1.         Assignor.  The Assignor (a) represents and warrants that
(i) it is the legal and beneficial owner of the Assigned Interest, (ii) the
Assigned Interest is free and clear of any lien, encumbrance or other adverse
claim and (iii) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or
representations made in or in connection with the Credit Agreement or any other
Loan Document, (ii) the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Loan Documents or any collateral
thereunder, (iii) the financial condition of the Borrower, any of its
Subsidiaries or Affiliates or any other Person obligated in respect of any Loan
Document or (iv) the performance or observance by the Borrower, any of its
Subsidiaries or Affiliates or any other Person of any of their respective
obligations under any Loan Document.


 


1.2.         Assignee.  The Assignee (a) represents and warrants that
(i) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby and to become a Lender under the Credit
Agreement, (ii) it meets all requirements of an Eligible Assignee under the
Credit Agreement (subject to receipt of such consents as may be required under
the Credit Agreement), (iii) from and after the Effective Date, it shall be
bound by the provisions of the Credit Agreement as a Lender thereunder and, to
the extent of the Assigned Interest, shall have the obligations of a Lender
thereunder, (iv) it has received a copy of the Credit Agreement, together with
copies of the most recent financial statements delivered pursuant to Section      
thereof, as applicable, and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and Assumption and to purchase the Assigned Interest on the
basis of which it has made such analysis and decision independently and without
reliance on the Administrative Agent or any other Lender, and (v) if it is a
Foreign Lender, attached hereto is any documentation required to be delivered
by it pursuant to the terms of the Credit Agreement, duly completed and
executed by the Assignee; and (b) agrees that (i) it will, independently and
without reliance on the Administrative Agent, the Assignor or any other Lender,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Loan Documents, and (ii) it will perform in accordance with their
terms all of the obligations which by the terms of the Loan Documents are
required to be performed by it as a Lender.


 


2.             Payments.  From and after the Effective Date, the
Administrative Agent shall make all payments in respect of the Assigned
Interest (including payments of principal, interest, fees and other amounts) to
the Assignor for amounts which have accrued to but excluding the Effective Date
and to the Assignee for amounts which have accrued from and after the Effective
Date.


 


4





















 


3.             General
Provisions.  This Assignment and
Assumption shall be binding upon, and inure to the benefit of, the parties
hereto and their respective successors and assigns.  This Assignment and Assumption may be
executed in any number of counterparts, which together shall constitute one
instrument.  Delivery of an executed counterpart
of a signature page of this Assignment and Assumption by telecopy shall be
effective as delivery of a manually executed counterpart of this Assignment and
Assumption.  This Assignment and
Assumption shall be governed by, and construed in accordance with, the law of
the State of New York.


 


5





















 


EXHIBIT F


 


FORM OF GUARANTY


 





















 


EXHIBIT G


 


FORM OF PLEDGE AND SECURITY AGREEMENT


 





















 


EXHIBIT H


 


OPINION MATTERS


 


The matters contained in the following
Sections of the Credit Agreement should be covered by the legal opinion:


 


	
  •

  	
  Section
  5.01(a), (b) and (c)

  
	
   

  	
   

  
	
  •

  	
  Section 5.02

  
	
   

  	
   

  
	
  •

  	
  Section 5.03

  
	
   

  	
   

  
	
  •

  	
  Section 5.04

  
	
   

  	
   

  
	
  •

  	
  Section 5.06

  
	
   

  	
   

  
	
  •

  	
  Section 5.14(b)

  



 


In addition, matters with respect to lien and
security interest creation and perfection should be covered by the legal
opinion.


 





















 


EXHIBIT I


 


SOLVENCY CERTIFICATE


 





















 


EXHIBIT J


COLLATERAL SHARING
AGREEMENT