exv10w1






Execution Copy




 

 






CREDIT AGREEMENT




Dated as
of March 20, 2009


among




PATTERSON — UTI ENERGY, INC.,

as the Borrower,




WELLS FARGO BANK, N.A.,

as Administrative Agent,

an L/C Issuer, Swing Line Lender and a Lender,




and




The Other Lenders Party Hereto




BANK OF AMERICA, N.A.,

as Syndication Agent and an L/C Issuer




THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.,

as Documentation Agent




WELLS FARGO BANK, N.A.

and BANC OF AMERICA SECURITIES LLC

as Co-Lead Arrangers and Joint Book Runners




 

 








 












 












TABLE OF CONTENTS




	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Page
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE I	 	     DEFINITIONS AND ACCOUNTING TERMS	 	 	1	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	1.01	 	 	Defined Terms
	 	 	1	 
	 

	 	 	1.02	 	 	Other Interpretive Provisions
	 	 	21	 
	 

	 	 	1.03	 	 	Accounting Terms
	 	 	22	 
	 

	 	 	1.04	 	 	Rounding
	 	 	22	 
	 

	 	 	1.05	 	 	Times of Day
	 	 	22	 
	 

	 	 	1.06	 	 	Letter of Credit Amounts
	 	 	22	 
	 

	 	 	1.07	 	 	Responsible Officer
	 	 	22	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE II	 	     THE COMMITMENTS AND CREDIT EXTENSIONS	 	 	23	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	2.01	 	 	Loans
	 	 	23	 
	 

	 	 	2.02	 	 	Borrowings, Conversions and Continuations of Loans
	 	 	23	 
	 

	 	 	2.03	 	 	Letters of Credit
	 	 	24	 
	 

	 	 	2.04	 	 	Voluntary Prepayments
	 	 	33	 
	 

	 	 	2.05	 	 	Mandatory Prepayments
	 	 	33	 
	 

	 	 	2.06	 	 	Termination or Reduction of Commitments
	 	 	34	 
	 

	 	 	2.07	 	 	Repayment of Loans
	 	 	34	 
	 

	 	 	2.08	 	 	Interest
	 	 	34	 
	 

	 	 	2.09	 	 	Fees
	 	 	35	 
	 

	 	 	2.10	 	 	Computation of Interest and Fees
	 	 	35	 
	 

	 	 	2.11	 	 	Evidence of Debt
	 	 	36	 
	 

	 	 	2.12	 	 	Payments Generally; Administrative Agent’s Clawback
	 	 	36	 
	 

	 	 	2.13	 	 	Sharing of Payments by Lenders
	 	 	38	 
	 

	 	 	2.14	 	 	Increase in Commitments
	 	 	39	 
	 

	 	 	2.15	 	 	Swing Line Loans
	 	 	40	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE III	 	     TAXES, YIELD PROTECTION AND ILLEGALITY	 	 	43	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	3.01	 	 	Taxes
	 	 	43	 
	 

	 	 	3.02	 	 	Illegality
	 	 	45	 
	 

	 	 	3.03	 	 	Inability to Determine Rates
	 	 	46	 
	 

	 	 	3.04	 	 	Increased Costs; Reserves on Eurodollar Rate Loans
	 	 	46	 
	 

	 	 	3.05	 	 	Compensation for Losses
	 	 	47	 
	 

	 	 	3.06	 	 	Mitigation Obligations; Replacement of Lenders
	 	 	48	 
	 

	 	 	3.07	 	 	Survival
	 	 	48	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE IV	 	     CONDITIONS PRECEDENT TO CREDIT EXTENSIONS	 	 	48	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	4.01	 	 	Conditions of Initial Credit Extension
	 	 	48	 
	 

	 	 	4.02	 	 	Conditions to all Credit Extensions
	 	 	50	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE V	 	     REPRESENTATIONS AND WARRANTIES	 	 	51	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	5.01	 	 	Existence, Qualification and Power; Compliance with Laws
	 	 	51	 
	 

	 	 	5.02	 	 	Authorization; No Contravention
	 	 	51	 
	 

	 	 	5.03	 	 	Governmental Authorization; Other Consents
	 	 	51	 






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	 	 	 	 	 	 	 	 	Page
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	5.04	 	 	Binding Effect
	 	 	52	 
	 

	 	 	5.05	 	 	Financial Statements; No Material Adverse Effect
	 	 	52	 
	 

	 	 	5.06	 	 	Litigation
	 	 	52	 
	 

	 	 	5.07	 	 	No Default
	 	 	52	 
	 

	 	 	5.08	 	 	Ownership of Property; Liens
	 	 	52	 
	 

	 	 	5.09	 	 	Environmental Compliance
	 	 	52	 
	 

	 	 	5.10	 	 	Insurance
	 	 	53	 
	 

	 	 	5.11	 	 	Taxes
	 	 	53	 
	 

	 	 	5.12	 	 	ERISA Compliance
	 	 	53	 
	 

	 	 	5.13	 	 	Subsidiaries; Equity Interests
	 	 	54	 
	 

	 	 	5.14	 	 	Margin Regulations; Investment Company Act
	 	 	54	 
	 

	 	 	5.15	 	 	Disclosure
	 	 	54	 
	 

	 	 	5.16	 	 	Compliance with Laws
	 	 	54	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE VI	 	     AFFIRMATIVE COVENANTS	 	 	55	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	6.01	 	 	Financial Statements
	 	 	55	 
	 

	 	 	6.02	 	 	Certificates; Other Information
	 	 	56	 
	 

	 	 	6.03	 	 	Notices
	 	 	57	 
	 

	 	 	6.04	 	 	Payment of Obligations
	 	 	57	 
	 

	 	 	6.05	 	 	Preservation of Existence, Etc
	 	 	58	 
	 

	 	 	6.06	 	 	Maintenance of Properties
	 	 	58	 
	 

	 	 	6.07	 	 	Maintenance of Insurance
	 	 	58	 
	 

	 	 	6.08	 	 	Compliance with Laws
	 	 	58	 
	 

	 	 	6.09	 	 	Books and Records
	 	 	58	 
	 

	 	 	6.10	 	 	Inspection Rights
	 	 	58	 
	 

	 	 	6.11	 	 	Use of Proceeds
	 	 	59	 
	 

	 	 	6.12	 	 	Additional Guarantors
	 	 	59	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE VII	 	     NEGATIVE COVENANTS	 	 	59	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	7.01	 	 	Liens
	 	 	59	 
	 

	 	 	7.02	 	 	Foreign Subsidiaries and Joint Ventures
	 	 	60	 
	 

	 	 	7.03	 	 	Indebtedness of Subsidiaries
	 	 	61	 
	 

	 	 	7.04	 	 	Fundamental Changes
	 	 	61	 
	 

	 	 	7.05	 	 	Hedging Agreements
	 	 	63	 
	 

	 	 	7.06	 	 	Change in Nature of Business
	 	 	63	 
	 

	 	 	7.07	 	 	Transactions with Affiliates
	 	 	63	 
	 

	 	 	7.08	 	 	Burdensome Agreements
	 	 	63	 
	 

	 	 	7.09	 	 	Use of Proceeds
	 	 	64	 
	 

	 	 	7.10	 	 	Financial Covenants
	 	 	64	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE VIII	 	     EVENTS OF DEFAULT AND REMEDIES	 	 	64	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	8.01	 	 	Events of Default
	 	 	64	 
	 

	 	 	8.02	 	 	Remedies Upon Event of Default
	 	 	66	 






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	 	 	 	 	 	 	 	 	Page
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	8.03	 	 	Application of Funds
	 	 	67	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE IX	 	     ADMINISTRATIVE AGENT	 	 	67	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	9.01	 	 	Appointment and Authority
	 	 	67	 
	 

	 	 	9.02	 	 	Rights as a Lender
	 	 	68	 
	 

	 	 	9.03	 	 	Exculpatory Provisions
	 	 	68	 
	 

	 	 	9.04	 	 	Reliance by Administrative Agent
	 	 	69	 
	 

	 	 	9.05	 	 	Delegation of Duties
	 	 	69	 
	 

	 	 	9.06	 	 	Resignation of Administrative Agent
	 	 	69	 
	 

	 	 	9.07	 	 	Non-Reliance on Administrative Agent and Other Lenders
	 	 	70	 
	 

	 	 	9.08	 	 	No Other Duties, Etc
	 	 	70	 
	 

	 	 	9.09	 	 	Administrative Agent May File Proofs of Claim
	 	 	71	 
	 

	 	 	9.10	 	 	Guaranty Matters
	 	 	71	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE X	 	     MISCELLANEOUS	 	 	72	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	10.01	 	 	Amendments, Etc
	 	 	72	 
	 

	 	 	10.02	 	 	Notices; Effectiveness; Electronic Communication
	 	 	73	 
	 

	 	 	10.03	 	 	No Waiver; Cumulative Remedies
	 	 	74	 
	 

	 	 	10.04	 	 	Expenses; Indemnity; Damage Waiver
	 	 	74	 
	 

	 	 	10.05	 	 	Payments Set Aside
	 	 	76	 
	 

	 	 	10.06	 	 	Successors and Assigns
	 	 	76	 
	 

	 	 	10.07	 	 	Treatment of Certain Information; Confidentiality
	 	 	80	 
	 

	 	 	10.08	 	 	Right of Setoff
	 	 	81	 
	 

	 	 	10.09	 	 	Interest Rate Limitation
	 	 	81	 
	 

	 	 	10.10	 	 	Counterparts; Integration; Effectiveness
	 	 	82	 
	 

	 	 	10.11	 	 	Survival of Representations and Warranties
	 	 	82	 
	 

	 	 	10.12	 	 	Severability
	 	 	82	 
	 

	 	 	10.13	 	 	Impacted Lenders
	 	 	82	 
	 

	 	 	10.14	 	 	Governing Law; Jurisdiction; Etc
	 	 	84	 
	 

	 	 	10.15	 	 	Waiver of Jury Trial
	 	 	85	 
	 

	 	 	10.16	 	 	USA PATRIOT Act Notice
	 	 	86	 
	 

	 	 	10.17	 	 	ENTIRE AGREEMENT
	 	 	86	 
	 

	 	 	10.18	 	 	Termination of Commitments under Existing Credit Agreement
	 	 	86	 
	 
	 	 	 	 	 	 	 	 	 	 
	SIGNATURES	 	 	S-1	 






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(continued)




SCHEDULES




	 	 	 
	1.01

	 	Existing Letters of Credit
	2.01

	 	Commitments and Applicable Percentages
	5.13

	 	Subsidiaries; Other Equity Investments
	7.01

	 	Existing Liens
	10.02

	 	Administrative Agent’s Office; Certain Addresses for Notices






EXHIBITS




	 	 	 
	 	 	Form of
	A

	 	Loan Notice
	B

	 	Note
	C

	 	Compliance Certificate
	D

	 	Assignment and Assumption
	E

	 	Guaranty
	F

	 	Opinion of Counsel
	G

	 	Swing Line Loan Notice
	H

	 	Prepayment Notice







-iv-











 





CREDIT AGREEMENT




     This CREDIT AGREEMENT is entered into as of March 20, 2009 among PATTERSON — UTI ENERGY,
INC., a Delaware corporation (the “Borrower”), each lender from time to time party hereto
(collectively, the “Lenders” and individually, a “Lender”), and WELLS FARGO BANK,
N.A., as Administrative Agent, Swing Line Lender, an L/C Issuer and a Lender.



     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:



     “Administrative Agent” means Wells Fargo 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 provide 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, as the same may hereafter be renewed,
extended, amended or restated from time to time.



     “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 each
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, from time to time, the following percentages per annum, based
upon the Debt to Capitalization Ratio as set forth below:



Applicable Rate




	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Eurodollar	 	 
	 	 	Debt to	 	 	 	Rate;	 	 
	Pricing	 	Capitalization	 	Commitment	 	Letters of	 	 
	Level	 	Ratio	 	Fee	 	Credit	 	Base Rate
	 
	 	 	 	 	 	 	 	 
	1
	 	Less than or equal to 20%	 	1.00%	 	3.00%	 	2.00%
	 
	 	 	 	 	 	 	 	 
	2
	 	Greater than 20%, but less than or equal to 30%	 	1.05%	 	3.50%	 	2.50%
	 
	 	 	 	 	 	 	 	 
	3
	 	Greater than 30%	 	1.125%	 	4.00%	 	3.00%






     Any increase or decrease in the Applicable Rate resulting from a change in the Debt to
Capitalization Ratio shall become effective as of the date (the “Adjustment Date”) that is
the first day of the fiscal quarter (the “Applicable Quarter”) immediately following the
date that a Compliance Certificate is due to be delivered pursuant to Section 6.02(b)
hereof; provided, however, that if a Compliance Certificate is not delivered within thirty (30)
days after the date due, then Pricing Level 3 shall apply as of the Adjustment Date.



     The Applicable Rate in effect from the Closing Date through the date the Compliance
Certificate is delivered in connection with the fiscal quarter ended March 31, 2009, shall be the
Pricing Level 1.



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



     “Arrangers” means Wells Fargo and Banc of America Securities LLC (or any successors
thereto), in their capacity as co-lead arrangers and joint book runners.



     “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 D or any other form approved by the Administrative Agent.



-2-









 





     “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, 2008, and the related
consolidated statements of income or operations, shareholders’ equity and cash flows for such
fiscal year of the Borrower and its Subsidiaries, including the notes thereto.



     “AutoBorrow Agreement” means any agreement providing for automatic borrowing services
between the Borrower and the Swing Line Lender.



     “Auto-Extension Letter of Credit” has the meaning set forth therefor in Section
2.03(b)(iii).



     “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 each L/C Issuer to make L/C Credit Extensions pursuant to
Section 8.02.



     “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 greatest of
(a) the Federal Funds Rate plus one and one-half percent (1.50%), (b) the Daily One Month LIBOR
Rate plus one and one-half percent (1.50%), and (c) the rate of interest in effect for such day as
publicly announced from time to time by Wells Fargo as its “prime rate.” The “prime rate” is a
rate set by Wells Fargo based upon various factors including Wells Fargo’s costs and desired
return, general economic conditions and other factors, and is used as a reference point for pricing
some loans, which may be priced at, above, or below such announced rate. Any change in such rate
announced by Wells Fargo 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.



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



     “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



-3-









 







Rate Loan, means, in addition, any such day on which dealings in Dollar deposits are conducted
by and between banks in the London interbank eurodollar market.



     “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 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 25% 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



-4-









 







all such securities that such Person or group has the right to acquire pursuant to any option
right) representing 25% 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, as amended.



     “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 C.



     “Consolidated EBITDA” means, for any period, for the Borrower and its 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 (including state franchise taxes based on income or similar taxes based on income) payable by
the Borrower and its Subsidiaries for such period, (iii) depreciation, depletion and amortization
expense and (iv) other expenses of the Borrower and its Subsidiaries reducing such Consolidated Net
Income which do not represent a cash item in such period or any future period and minus, to the
extent included in calculating such Consolidated Net Income, all non-cash items increasing
Consolidated Net Income for such period.



     “Consolidated Funded Indebtedness” means, as of any date of determination,
Indebtedness of the Borrower and its Subsidiaries on a consolidated basis, excluding (a)
Indebtedness of the type described in clauses (b) (so long as such amounts in such clause are
contingent obligations), (c) and (g) of the definition of Indebtedness and (b) Guarantees in
respect of Indebtedness described in the foregoing clause (a).



     “Consolidated Interest Charges” means, for any period, for the Borrower and its
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 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, and (b) the portion of rent
expense of the Borrower and its Subsidiaries with respect to such period under capital leases that
is treated as interest in accordance with GAAP.



     “Consolidated Net Income” means, for any period, for the Borrower and its Subsidiaries
on a consolidated basis, the net income of the Borrower and its Subsidiaries (excluding
extraordinary gains and extraordinary losses) for that period.



-5-









 





     “Consolidated Net Worth” means, as of any date of determination, for the Borrower and
its Subsidiaries on a consolidated basis, Shareholders’ Equity of the Borrower and its Subsidiaries
on that 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.



     “Daily One Month LIBOR” means, for any day, the rate per annum equal to the Eurodollar
Rate for a one month Interest Period.



     “Debt to Capitalization Ratio” means the ratio of Consolidated Funded Indebtedness to
Total Capital.



     “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 or participations in Swing Line Loans or any other
amount required to be funded by it hereunder within one Business Day of the date required to be
funded by it hereunder, (b) has indicated to the Administrative Agent that such Lender will not
fund any portion of the Loans or participations in L/C Obligations or Swing Line Loans required to
be funded by it hereunder, (c) has otherwise failed to pay 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 (d) (i) has become, been deemed, or
is insolvent or (ii) become the subject of a bankruptcy or insolvency proceeding, or



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has had a receiver, conservator, trustee, or custodian appointed for it, or has taken any
action in furtherance of, or indicating its consent to, approval of or acquiescence in any such
proceeding or appointment.



     “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.



     “Domestic Subsidiary” means any Subsidiary that is organized under the laws of any
political subdivision 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, (ii) an L/C Issuer and (iii) 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 materials into the environment, including those
related to hazardous substances or wastes, air emissions and discharges to waste or public systems.



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



     “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.



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     “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), (m) or (o) 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 withdrawal (within the meaning of Section 4203 of ERISA) or partial
withdrawal (within the meaning of Section 4205 of ERISA) by the Borrower or any ERISA Affiliate
from a Multiemployer Plan or receipt by the Borrower or an ERISA Affiliate of notice that a
Multiemployer Plan is in reorganization within the meaning of Section 4241 of ERISA; (d) the filing
of a notice of intent to terminate, the treatment of a Plan amendment as a termination under
Section 4041(c) of ERISA, receipt by the Borrower or an ERISA Affiliate of notice or the
termination or a Multiemployer Plan under Section 4041A of ERISA, or receipt by the Borrower or an
ERISA Affiliate of notice of the commencement of proceedings by the PBGC to terminate a Pension
Plan or Multiemployer Plan; (e) receipt by the Borrower or an ERISA Affiliate of notice of a
determination by the PBGC that an event has occurred or a condition exists 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 (rounded upward, if necessary, to the nearest whole 1/8 of 1%) equal to
the British Bankers Association LIBOR Rate (“BBA LIBOR”), as published by Reuters (or other
commercially available, internationally recognized 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 (2) 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 or will not adequately and fairly reflect
the cost to the Required Lenders of funding such Loan, then either (A) 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
Administrative Agent and with a term equivalent to such Interest Period would be offered by
Administrative Agent’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 or (B) for purposes of determining the Daily One Month LIBOR Rate only, the
Daily One Month LIBOR Rate shall be equal to the arithmetic average (rounded in accordance with
normal market practice) of BBA LIBOR for each day during the week prior to BBA LIBOR becoming
unavailable.



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



-8-









 





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



     “Excluded Taxes” means, with respect to the Administrative Agent, any Lender, any L/C
Issuer or any other recipient of any payment to be made by or on account of any obligation of the
Borrower hereunder, (a) taxes imposed on or measured by its overall net income (however
denominated), and franchise taxes imposed on it (in lieu of net income taxes), by the United
States, any state thereof, or by the jurisdiction (or any political subdivision thereof) under the
laws of which such recipient is organized or in which its principal office is located or, in the
case of any Lender, in which its applicable Lending Office is located, (b) any branch profits taxes
imposed by the United States or any similar tax imposed by any other jurisdiction in which the
Administrative Agent, any Lender, any L/C Issuer, any other recipient of any payment to be made by
or on account of any obligation of the Borrower hereunder or the Borrower is located, (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 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), and (d) in the case of any Foreign Lender that is subject
to withholding tax on amounts payable to such Foreign Lender at the time such Foreign Lender
becomes a party hereto (or designates a new Lending Office), any additional withholding tax that is
imposed on amounts payable to such Foreign Lender as a result of a Change in Law.



     “Existing Credit Agreement” means the Credit Agreement dated as of December 17, 2004
among the Borrower, the lenders party thereto and Bank of America, N.A., as administrative agent,
as amended, supplemented or otherwise modified on or before the date hereof.



     “Existing Letters of Credit” means those certain Letters of Credit that are
outstanding on the Closing Date and that are listed on Schedule 1.01.



     “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 rate most recently published.



     “Fee Letter” means the letter agreement, dated December 8, 2008, among the Borrower
and the Arrangers.



     “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.



-9-









 





     “Foreign Subsidiary” means any Subsidiary other than a Domestic Subsidiary.



     “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).



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



-10-









 





     “Guarantor” means (a) as of the Closing Date, each of the Domestic Subsidiaries
identified on Schedule 5.13, and (b) after the Closing Date, any other Subsidiary of the
Company required to execute a Guaranty under Section 6.12 hereof.



     “Guaranty” means the Guaranty made by the Guarantors in favor of the Administrative
Agent and the Lenders, substantially in the form of Exhibit E, and such additional guaranty
agreements as may hereafter be executed.



     “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.



     “Hydrocarbon Interests” means all rights, titles, interests and estates now owned or
hereafter acquired by the Borrower or any of its Subsidiaries in any and all oil, gas and other
liquid or gaseous hydrocarbon properties and interests, including without limitation, mineral fee
or lease interests, production sharing agreements, concession agreements, license agreements,
service agreements, risk service agreements or similar Hydrocarbon interests granted by an
appropriate Governmental Authority, farmout, overriding royalty and royalty interests, net profit
interests, oil payments, production payment interests and similar interests in Hydrocarbons,
including any reserved or residual interests of whatever nature.



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



     “Immaterial Subsidiary” means any Subsidiary having total assets (real or personal,
tangible or intangible) of less than $100,000.



     “Impacted Lender” means (a) any Lender that is a Defaulting Lender and (b) any Lender
as to which (i) the Borrower, the Administrative Agent or any L/C Issuer has a good faith belief
that such Lender has defaulted in fulfilling its obligations under one or more other syndicated
credit facilities or (ii) an entity that controls such Lender has been deemed insolvent or become
subject to a bankruptcy or other similar proceeding.



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



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



          (b) (i) reimbursement obligations of such Person in respect of letters of credit (including
standby and commercial), bankers’ acceptances, bank guaranties, surety bonds and similar
instruments; and (ii) contingent obligations of such Person in respect of letters of credit



-11-









 







(including standby and commercial), bankers’ acceptances, bank guaranties, surety bonds and similar
instruments;



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



          (d) all obligations of such Person to pay the deferred purchase price of property or services
(other than (i) trade accounts payable to a Person in the United States or Canada in the ordinary
course of business and, in each case, not past due for more than 60 days, and (ii) trade accounts
payable to a Person in a country other than the United States or Canada in the ordinary course of
business and, in each case, not past due for more than 120 days); and



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



          (f) capital leases;



          (g) Off-Balance Sheet Liabilities;



          (h) obligations in respect of a forward sale of production for which such Person has received
payment in advance other than on ordinary trade terms;



          (i) all obligations of such Person to purchase, redeem, retire, defease or otherwise make any
payment in respect of any Equity Interest in such Person or any other Person, on a date certain and
not subject to any contingencies, or at the option of the holder of such Equity Interest, 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



          (j) 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 Swap Contract on any date shall be deemed to be the Swap 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.



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



     “Interest Coverage Ratio” means, as of any date of determination, the ratio of (a)
Consolidated EBITDA for the period of the four prior fiscal quarters ending on such date to (b)
Consolidated Interest Charges for such period.



-12-









 





     “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 or Swing Line 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, three or six months thereafter, as selected by the Borrower in its Loan
Notice; provided that:



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



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



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



     “Investment” means, as to any Person, any direct or indirect acquisition or investment
by such Person, whether by means of (a) the purchase or other acquisition of capital stock or other
securities of another Person, or (b) a loan, advance or capital contribution to, Guarantee or
assumption of debt of, or purchase or other acquisition of any other debt or equity participation
or interest in, 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. The term “Investment” does not include (a) investment in cash equivalents or
short-term marketable debt securities; (b) 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, or (c) investments in direct ownership interests in Oil and Gas Properties (and related
personal property used in the operating, working or development thereof), net revenue interests,
royalty interests, or related to Oil and Gas Agreements, or other similar arrangements in the
ordinary course of the Borrower’s business which are usual and customary in the ordinary course of
the oil and gas exploration and production business. As used in this definition, “Person” does not
include a natural person.



     “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).



-13-









 





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



     “Joint Venture” means any Person (A) in which the Borrower or a Subsidiary invests
cash, or to which the Borrower or a Subsidiary transfers assets (other than in the ordinary course
of business) used or useful in the Borrower’s or such Subsidiary’s business, and the Borrower or
such Subsidiary receives in return ownership interests in such Person, (B) that carries on a trade
or business that is the same or similar to the business carried on by the Borrower and its
Subsidiaries, (C) some portion of the equity interests (excluding director’s qualifying shares or
similar ownership qualifications applying to such Person’s board of directors or similar policy
making group) of which are owned by a Person or Persons other than the Borrower or its
Subsidiaries, and (D) the senior management functions of which are carried out by a group that
includes officers or directors of the Borrower or a Subsidiary; provided, however, that a Joint
Venture shall not include:



          (a) a natural person, or



          (b) a Person having a class of common stock (a) that is registered under the Securities
Exchange Act of 1934, (b) that is publicly traded on a recognized national market, including
electronic markets such as the NASDAQ Stock Market, or (c) for which bid or ask prices are quoted
in the publication known as the pink sheets or similar reporting service for thinly traded
companies.



     “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.



     “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 Wells Fargo or Bank of America, each 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



-14-









 







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 and, as the
context requires, includes the Swing Line Lender.



     “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 designate by notice to the Borrower and the Administrative Agent.



     “Letter of Credit” means any letter of credit issued hereunder and shall include the
Existing Letters of Credit. A Letter of Credit may be a standby letter of credit or a commercial
letter of credit.



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



     “Letter of Credit Expiration Date” means the day that is not later than the earlier to
occur of (1) twelve months after the date of issuance or last extension, unless the Required
Lenders have approved such expiry date and (2) six months after the Maturity Date (excluding
automatic extensions in the applicable Letter of Credit, which extensions are subject to annual
cancellation in accordance with the terms of an Auto-Extension Letter of Credit), (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 $150,000,000. 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, the Fee
Letter, any Autoborrow Agreement, and the Guaranty.



     “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.



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



-15-









 





     “Material Adverse Effect” means (a) a material adverse change in, or a material
adverse effect upon, the operations, business, properties, liabilities (actual or contingent),
condition (financial or otherwise) of the Borrower and its Subsidiaries, taken as a whole; (b) a
material impairment of the ability of the Loan Parties collectively to perform their payment or
other material obligations under any Loan Document; (c) a material adverse effect upon the
legality, validity, binding effect or enforceability against the Borrower of any Loan Document to
which it is a party, or (d) a material adverse effect upon the legality, validity, binding effect
or enforceability against a Guarantor of any Loan Document to which it is a party if such material
adverse effect constitutes a material adverse effect on the legality, validity, binding effect or
enforceability of the Loan Documents against the Borrower and the Guarantors considered as a whole.



     “Maturity Date” means January 31, 2012.



     “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 with respect to which the Borrower or any ERISA Affiliate may have any liability,
contingent or otherwise.



     “Notes” means (a) a promissory note made by the Borrower in favor of a Lender
evidencing Loans made by such Lender, substantially in the form of Exhibit B, and (b) the Swing
Line Note.



     “Obligations” means all advances to, and debts, liabilities, obligations, covenants
and duties of, any Loan Party arising under any Loan Document or otherwise with respect to any Loan
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 or any Affiliate thereof of
any proceeding under any Debtor Relief Laws naming such Person as the debtor in such proceeding,
regardless of whether such interest and fees are allowed claims in such proceeding.



     “Off-Balance Sheet Liabilities” means, with respect to any Person as of any date of
determination thereof, without duplication and to the extent not included as a liability on the
consolidated balance sheet of such Person and its Subsidiaries in accordance with GAAP: (a) with
respect to any asset securitization transaction (including any accounts receivable purchase
facility) (i) the unrecovered investment of purchasers or transferees of assets so transferred
provided that such investment is ultimately due for repayment at some date certain, and (ii) any
other payment, recourse, repurchase, hold harmless, indemnity or similar obligation of such Person
or any of its Subsidiaries in respect of assets transferred or payments made in respect thereof,
other than limited recourse provisions that are customary for transactions of such type and that
neither (x) have the effect of limiting the loss or credit risk of such purchasers or transferees
with respect to payment or performance by the obligors of the assets so transferred nor (y) impair
the characterization of the transaction as a true sale under applicable Laws (including Debtor
Relief Laws); (b) any Synthetic Lease Obligation; (c) the monetary obligations under any sale and
leaseback transaction which does not create a liability on the consolidated balance sheet of such
Person and its Subsidiaries; or (d) any other monetary obligation arising



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with respect to any other transaction which (i) is characterized as indebtedness for tax
purposes but not for accounting purposes in accordance with GAAP or (ii) is the functional
equivalent of or takes the place of borrowing but which does not constitute a liability on the
consolidated balance sheet of such Person and its Subsidiaries (for purposes of this clause (d),
any transaction structured to provide tax deductibility as interest expense of any dividend, coupon
or other periodic payment will be deemed to be the functional equivalent of a borrowing).



     “Oil and Gas Agreements” means operating agreements, processing agreements, farm-out
and farm-in agreements, development agreements, area of mutual interest agreements, contracts for
the gathering and/or transportation of oil and natural gas, unitization agreements, pooling
arrangements, joint bidding agreements, joint venture agreements, participation agreements, surface
use agreements, service contracts, leases and subleases of Oil and Gas Properties or other similar
agreements which are customary in the oil and gas business, howsoever designated, in each case made
or entered into in the ordinary course of the oil and gas business as conducted by the Borrower and
its Subsidiaries.



     “Oil and Gas Properties” means (a) Hydrocarbon Interests; (b) the Property now or
hereafter pooled or unitized with Hydrocarbon Interests; (c) all presently existing or future
unitization, pooling agreements and declarations of pooled units and the units created thereby
(including, without limitation, all units created under orders, regulations and rules of any
Governmental Authority) which may affect all or any portion of the Hydrocarbon Interests; (d) all
operating agreements, contracts and other agreements which relate to any of the Hydrocarbon
Interests or the production, sale, purchase, exchange or processing of Hydrocarbons from or
attributable to such Hydrocarbon Interest; (e) all Hydrocarbons in and under and which may be
produced and saved or attributable to the Hydrocarbon Interests, the lands covered thereby and all
oil in tanks and all rents, issues, profits, proceeds, products, revenues and other income from or
attributable to the Hydrocarbon Interests; and (f) all tenements, hereditaments, appurtenances and
property in any manner appertaining, belonging, affixed or incidental to the Hydrocarbon Interests,
and any and all property, now owned or hereinafter acquired and situated upon, used, held for use
or useful in connection with the operating, working or development of any of such Hydrocarbon
Interests or property (excluding drilling rigs, automotive equipment or other personal property
which may be on such premises for the purpose of drilling a well or for other similar temporary
uses) and including any and all oil wells, gas wells, injection wells or other wells, buildings,
structures, fuel separators, liquid extraction plants, plant compressors, pumps, pumping units,
field gathering systems, tanks and tank batteries, fixtures, valves, fittings, machinery and parts,
engines, boilers, meters, apparatus, equipment, appliances, tools, implements, cables, wires,
towers, casing, tubing and rods, surface leases, rights-of-way, easements and servitudes together
with all additions, substitutions, replacements, accessions and attachments to any and all of the
foregoing.



     “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



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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 (other than Excluded Taxes) 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, except to
the extent such taxes, charges or similar levies are attributable to a Lender’s failure to comply
with Section 3.01(e).



     “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 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.



     “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, with respect to which the Borrower or
any ERISA Affiliate, may have any liability, contingent or otherwise.



     “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.



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



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



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of Credit Application and (c) with respect to a Swing Line Loan, a Swing Line Loan Notice or,
if an AutoBorrow Agreement is in effect, any notice required under such AutoBorrow Agreement.



     “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 each 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 and Swing Line Loans 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.



     “Responsible Officer” means the chief executive officer, president, chief financial
officer, treasurer or assistant treasurer of a Loan Party.



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



     “Shareholders’ Equity” means, as of any date of determination, consolidated
shareholders’ equity of the Borrower and its Subsidiaries as of that date determined in accordance
with GAAP.



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



     “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.



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



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a “Master Agreement”), including any such obligations or liabilities under any Master
Agreement.



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



     “Swing Line Borrowing” means a borrowing of a Swing Line Loan pursuant to Section
2.15, or, if an AutoBorrow Agreement is in effect, any transfer of funds pursuant to such
AutoBorrow Agreement.



     “Swing Line Lender” means Wells Fargo in its capacity as provider of Swing Line Loans,
or any successor swing line lender hereunder.



     “Swing Line Loan” has the meaning specified in Section 2.15(a).



     “Swing Line Loan Notice” means a notice of a Swing Line Borrowing pursuant to
Section 2.15(b), which, if in writing, shall be substantially in the form of Exhibit G, or
if an AutoBorrow Agreement is in effect, such other form as may be required therein.



     “Swing Line Note” means the promissory note made by the Borrower payable to the order
of the Swing Line Lender evidencing the indebtedness of the Borrower to the Swing Line Lender
resulting from Swing Line Loans in form acceptable to the Swing Line Lender.



     “Swing Line Payment Date” means (a) if an AutoBorrow Agreement is in effect, the
earliest to occur of (i) the date required by such AutoBorrow Agreement, (ii) demand is made by the
Swing Line Lender and (iii) the Maturity Date, or (b) if an AutoBorrow Agreement is not in effect,
the earlier to occur of (i) three (3) Business Days after demand is made by the Swing Line Lender
if no Default exists, and otherwise upon demand by the Swing Line Lender and (ii) the Maturity
Date.



     “Swing Line Sublimit” means an amount equal to $40,000,000. The Swing Line Sublimit
is part of, and not in addition to, the Aggregate Commitments.



     “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.



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     “Threshold Amount” means $20,000,000.



     “Total Capital” means, at any time, the sum of (a) Consolidated Funded Indebtedness
and (b) Consolidated Net Worth.



     “Total Outstandings” means the aggregate Outstanding Amount of all Loans, Swing Line
Loans and 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 as of the most recently completed fiscal year of the Pension
Plan, over the current value of that Pension Plan’s assets as of the most recently completed fiscal
year of the Pension Plan, 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).



     “Wells Fargo” means Wells Fargo Bank, N.A. and its successors.



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



          (a) The definitions of terms herein shall apply equally to the singular and plural forms of
the terms defined. Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be
deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to
have the same meaning and effect as the word “shall.” Unless the context requires otherwise, (i)
any definition of or reference to any agreement, instrument or other document (including 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.




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          (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 calculated and 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. Except as otherwise expressly provided herein, all terms of an
accounting or financial nature shall be construed in accordance with GAAP, as in effect from time
to time; provided that, if the Borrower notifies the Administrative Agent that the Borrower
requests an amendment to any provision hereof to eliminate the effect of any change occurring after
the date hereof in GAAP (including but not limited to any Statement of Financial Accounting
Standards) or in the application thereof on the operation of such provision (or if the
Administrative Agent notifies the Borrower that the Required Lenders request an amendment to any
provision hereof for such purpose), regardless of whether any such notice is given before or after
such change in GAAP or in the application thereof, then (a) such provision shall be interpreted on
the basis of GAAP as in effect and applied immediately before such change shall have become
effective until such notice shall have been withdrawn or such provision amended in accordance
herewith, and (b) if such change in GAAP would affect the computation of any financial ratio or
requirement set forth in this Agreement, then if so requested by the Administrative Agent, the
Borrower shall provide to the Administrative Agent and the Lenders financial statements and other
documents required under this Agreement or as reasonably requested setting forth a reconciliation
between calculations of such ratio or requirement made before and after giving effect to such
change in GAAP.




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



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



     1.06 Letter of Credit Amounts. Unless otherwise specified herein, the amount of a Letter of
Credit at any time shall be deemed to be the stated amount of such Letter of Credit in effect at
such time (for purposes of clarity, it is understood by the parties that in the case of a Letter of
Credit which is issued in an initial face amount and is subsequently drawn, the “stated amount”
shall mean the remaining amount available to be drawn); provided, however, that with



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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.



     1.07 Responsible Officer. 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.



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, plus such Lender’s Applicable Percentage of the
Outstanding Amount of all Swing Line Loans shall not exceed such Lender’s Commitment. Within the
limits of 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 2.04, and
reborrow under this Section 2.01. Loans may be Base Rate Loans or Eurodollar Rate Loans,
as further provided herein.



     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 10:00 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. 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,



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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. Notwithstanding anything to the contrary
herein, a Swing Line Loan may not be converted to a Eurodollar Rate Loan.




          (b) Following receipt of a Loan Notice, the Administrative Agent shall promptly notify, on the
same day that the request is received from the Borrower, 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 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 Applicable Percentage of the Loan
available to the Administrative Agent in immediately available funds at the Administrative Agent’s
Office not later than 2:00 p.m. on the Business Day specified in the applicable Loan Notice. Upon
satisfaction of the applicable conditions set forth in Section 4.02 (and, if such Borrowing
is the initial Credit Extension, Section 4.01), the Administrative Agent shall make all
funds so received available to the Borrower in like funds as received by the Administrative Agent
either by (i) crediting the account of the Borrower on the books of Wells Fargo 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 Wells Fargo’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.




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          (f) If an AutoBorrow Agreement is in effect, each Swing Line Borrowing shall be made as
provided in such AutoBorrow Agreement. .




     2.03 Letters of Credit.



          (a) The Letter of Credit Commitment.





          (i) Subject to the terms and conditions set forth herein, (A) each of the L/C Issuers
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 day that is seven days prior to the Maturity Date then in effect, to issue Letters
of Credit for the account of the Borrower, and to amend or extend 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 and any drawings thereunder; provided that
after giving effect to any L/C Credit Extension with respect to any Letter of Credit, (v)
the Total Outstandings shall not exceed the Aggregate Commitments, (w) 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, plus such Lender’s Applicable Percentage of
the Outstanding Amount of all Swing Line Loans, shall not exceed such Lender’s Commitment,
(x) the Outstanding Amount of the L/C Obligations shall not exceed the Letter of Credit
Sublimit, (y) the Outstanding Amount of the L/C Obligations related to Letters of Credit
issued by Wells Fargo shall not exceed $75,000,000 and (z) the Outstanding Amount of the L/C
Obligations related to Letters of Credit issued by Bank of America shall not exceed
$75,000,000. Each request by the Borrower for the issuance or amendment of a Letter of
Credit shall be deemed to be a representation by the Borrower that the L/C Credit Extension
so requested complies with the conditions set forth in the proviso to the preceding
sentence. Within the foregoing limits, and subject to the terms and conditions hereof, the
Borrower’s ability to obtain Letters of Credit shall be fully revolving, and accordingly the
Borrower may, during the foregoing period, obtain Letters of Credit to replace Letters of
Credit that have expired or that have been drawn upon and reimbursed. All Existing Letters
of Credit shall be deemed to have been issued pursuant hereto, and from and after the
Closing Date shall be subject to and governed by the terms and conditions hereof.




          (ii) No L/C Issuer shall issue any Letter of Credit, if, subject to Section
2.03(b)(iii), the expiry date of such requested Letter of Credit would (excluding
automatic extensions in the applicable Letter of Credit, which extensions are subject to
annual cancellation in accordance with the terms of an Auto-Extension Letter of Credit)
occur after the Letter of Credit Expiration Date.




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




                    (A) any order, judgment or decree of any Governmental Authority or arbitrator
shall by its terms purport to enjoin or restrain such L/C Issuer from issuing such
Letter of Credit, or any Law applicable to such L/C



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




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




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




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




                    (E) if a default of any Lender’s obligations to fund under Section
2.03(c) exists or any Lender is at such time an Impacted Lender hereunder,
unless such L/C Issuer has entered into satisfactory arrangements with the Borrower
or such Lender to eliminate such L/C Issuer’s risk with respect to such Lender.




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




               (v) No L/C Issuer shall be under any obligation to amend any Letter of Credit if (A)
such 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) Each L/C Issuer shall act on behalf of the Lenders with respect to any Letters of
Credit issued by it and the documents associated therewith, and such 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 such 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 such L/C Issuer with respect to such acts or omissions, and
(B) as additionally provided herein with respect to such L/C Issuer.



          (b) Procedures for Issuance and Amendment of Letters of Credit; Auto-Extension Letters of
Credit.




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               (i) Each Letter of Credit shall be issued or amended, as the case may be, upon the
request of the Borrower delivered to the applicable L/C Issuer (with a copy to the
Administrative Agent) in the form of a Letter of Credit Application, appropriately completed
and signed by a Responsible Officer of the Borrower. Such Letter of Credit Application must
be received by such L/C Issuer and the Administrative Agent not later than 10:00 a.m. at
least two Business Days (or such later date and time as the Administrative Agent and such
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 such 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 such 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 such 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 such
L/C Issuer may reasonably require. Additionally, the Borrower shall furnish to such L/C
Issuer and the Administrative Agent such other documents and information pertaining to such
requested Letter of Credit issuance or amendment, including any Issuer Documents, as such
L/C Issuer or the Administrative Agent may reasonably require.




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




               (iii) If the Borrower so requests in any applicable Letter of Credit Application, such
L/C Issuer may, in its sole and absolute discretion, agree to issue a Letter of Credit that
has automatic extension provisions (each, an “Auto-Extension Letter of Credit”);
provided that any such Auto-Extension Letter of Credit must permit such L/C Issuer to
prevent any such extension at least once in each twelve-month period



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




               (iv) Promptly after its delivery of any Letter of Credit or any amendment to a Letter
of Credit to an advising bank with respect thereto or to the beneficiary thereof, such 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, such L/C Issuer shall notify the Borrower and the
Administrative Agent thereof. Not later than 10:00 a.m. on the date of any payment by the
applicable L/C Issuer under a Letter of Credit (each such date, an “Honor Date”),
the Borrower shall reimburse such L/C Issuer through the Administrative Agent in an amount
equal to the amount of such drawing. If the Borrower fails to so reimburse such 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 an 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 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 such L/C Issuer at



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the Administrative Agent’s Office in an amount equal to its Applicable Percentage of
the Unreimbursed Amount not later than 12:00 Noon on the Business Day specified in such
notice by the Administrative Agent, whereupon, subject to the provisions of Section
2.03(c)(iii), each Lender that so makes funds available shall be deemed to have made a
Base Rate Loan to the Borrower in such amount. The Administrative Agent shall remit the
funds so received to such L/C Issuer.




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




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




               (v) Each Lender’s obligation to make Loans or L/C Advances to reimburse an L/C Issuer
for amounts drawn under Letters of Credit, as contemplated by this Section 2.03(c),
shall be absolute and unconditional and shall not be affected by any circumstance, including
(A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have
against such L/C Issuer, the Borrower or any other Person for any reason whatsoever; (B) the
occurrence or continuance of a Default, or (C) any other occurrence, event or condition,
whether or not similar to any of the foregoing; provided, however, that each Lender’s
obligation to make 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 an L/C Issuer for the amount of any payment made by such L/C
Issuer under any Letter of Credit, together with interest as provided herein.




               (vi) If any Lender fails to make available to the Administrative Agent for the account
of an 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), such L/C Issuer shall be entitled to recover from such Lender (acting
through the Administrative Agent), on demand, such amount with interest thereon for the
period from the date such payment is required to the date on which such payment is
immediately available to such L/C Issuer at a rate per annum equal to the greater of the
Federal Funds Rate and a rate determined by such L/C Issuer in accordance with banking
industry rules on interbank compensation. A certificate of an L/C Issuer submitted to any



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Lender (through the Administrative Agent) with respect to any amounts owing under this clause
(vi) shall be presumed correct absent manifest error.



          (d) Repayment of Participations.





               (i) At any time after an L/C Issuer has made a payment under any Letter of Credit and
has received from any Lender such Lender’s L/C Advance in respect of such payment in
accordance with Section 2.03(c), if the Administrative Agent receives for the
account of such L/C Issuer any payment in respect of the related Unreimbursed Amount or
interest thereon (whether directly from the Borrower or otherwise, including proceeds of
Cash Collateral applied thereto by the Administrative Agent), the Administrative Agent will
distribute to such Lender its Applicable Percentage thereof (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 an 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 an L/C Issuer in its discretion), each Lender shall pay to the
Administrative Agent for the account of such L/C Issuer its Applicable Percentage thereof on
demand of the Administrative Agent, plus interest thereon from the date of such demand to
the date such amount is returned by such Lender, at a rate per annum equal to the Federal
Funds Rate from time to time in effect. The obligations of the Lenders under this clause
shall survive the payment in full of the Obligations and the termination of this Agreement.



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





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




               (ii) the existence of any claim, counterclaim, setoff, defense or other right that the
Borrower or any Subsidiary may have at any time against any beneficiary or any transferee of
such Letter of Credit (or any Person for whom any such beneficiary or any such transferee
may be acting), an 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;



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




          (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 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.




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




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          (g) Cash Collateral. Upon the request of the Administrative Agent, (i) if an 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 seven days prior to the Maturity Date then in
effect, 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 Section
8.02(c), “Cash Collateralize” means to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of the applicable L/C Issuer and the Lenders, as collateral
for the L/C Obligations, either (A) cash or deposit account balances pursuant to documentation in
form and substance satisfactory to the Administrative Agent and the applicable L/C Issuers (which
documents are hereby consented to by the Lenders) or (B) one or more letters of credit issued by
financial institutions having the same or better credit rating as the applicable L/C Issuers in
form and substance satisfactory to the Administrative Agent and the applicable L/C Issuers (which
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 Issuers 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, interest bearing
deposit accounts at Wells Fargo.




          (h) Applicability of ISP and UCP. Unless otherwise expressly agreed by an L/C Issuer
and the Borrower when a Letter of Credit is issued, (i) the rules of the ISP shall apply to each
standby Letter of Credit, and (ii) the rules of the Uniform Customs and Practice for Documentary
Credits as most recently published by the International Chamber of Commerce at the time of issuance
shall apply to each commercial 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 applicable
to Eurodollar Rate Loans 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 first Business Day after the end 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 applicable to Eurodollar Rate Loans during any quarter, the daily amount available
to be drawn under each Letter of Credit shall be computed and multiplied by the Applicable Rate
applicable to Eurodollar Rate Loans separately for each period during such quarter that such
Applicable Rate was in effect. Notwithstanding anything to the contrary contained herein, upon the
request of the Required Lenders, while any Event of Default exists, 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 each applicable L/C Issuer for its own account a fronting fee with
respect to each Letter of Credit, equal to the greater of (i) 0.125% per annum, computed on the
stated amount of such Letter of Credit and (ii) $500.00. Such fronting fee shall



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be due and payable in advance on the date of the issuance of the Letter of Credit, and, in the
case of an increase or extension only, on the date of such increase or such extension. For
purposes of computing the stated amount of any Letter of Credit, the amount of such Letter of
Credit shall be determined in accordance with Section 1.06. In addition, the Borrower
shall pay directly to each applicable L/C Issuer for its own account the customary issuance,
presentation, amendment and other processing fees, and other standard costs and charges, of such
L/C Issuer relating to letters of credit in each case as determined in accordance with such L/C
Issuer’s fee policy 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) Letter of Credit Issued for Subsidiaries. Notwithstanding that a Letter of Credit
issued or outstanding hereunder is in support of any obligations of, or is for the account of, a
Subsidiary, the Borrower shall be obligated to reimburse the applicable L/C Issuer hereunder for
any and all drawings under such Letter of Credit. The Borrower hereby acknowledges that the
issuance of Letters of Credit for the account of Subsidiaries inures to the benefit of the
Borrower, and that the Borrower’s business derives substantial benefits from the businesses of such
Subsidiaries.




     2.04 Voluntary 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
10:00 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 (which shall be a Business Day) and amount of
such prepayment, the Type(s) of Loans to be prepaid and shall be substantially in the form of
Exhibit H. 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 Loan shall be accompanied by all accrued interest to the date of prepayment on the
amount prepaid, and, in the case of Eurodollar Rate Loans, 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) The Borrower may, upon notice to the Swing Line Lender (with a copy to the Administrative
Agent), at any time or from time to time, voluntarily prepay Swing Line Loans in whole or in part
without premium or penalty; provided that (A) such notice must be received by the Swing Line Lender
and the Administrative Agent not later than 1:00 p.m. on the date of the prepayment, and (B) any
such prepayment shall be in a minimum principal amount of $100,000. Each such notice shall specify
the date (which shall be a Business Day) and amount



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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. If an AutoBorrow Agreement is in effect, each prepayment of a Swing Line
Borrowing shall be made as provided in such AutoBorrow Agreement.




     2.05 Mandatory Prepayments. If for any reason the Total Outstandings at any time exceed the
Aggregate Commitments then in effect, the Borrower shall immediately prepay Loans, Swing Line 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 unless after the prepayment in full of the Loans
the Total Outstandings exceed the Aggregate Commitments then in effect. If an AutoBorrow Agreement
is in effect, the Borrower shall make such mandatory prepayments of Swing Line Loans which may be
required under such AutoBorrow Agreement.



     2.06 Termination or Reduction of Commitments. The Borrower may, upon notice to the
Administrative Agent, terminate the Aggregate Commitments or the Swing Line Sublimit, or from time
to time permanently reduce the Aggregate Commitments or the Swing Line Sublimit; provided that (i)
any such notice shall be received by the Administrative Agent not later than 10:00 a.m. five
Business Days prior to the date of termination or reduction, (ii) any such partial reduction shall
be in an aggregate amount of $10,000,000 or any whole multiple of $1,000,000 in excess thereof,
(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, or (iv) if, after giving effect to any reduction of the Aggregate
Commitments, the Letter of Credit Sublimit or the Swing Line 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. The Borrower shall repay each Swing
Line Loan on the Swing Line Payment 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 and (iii) each
Swing Line Loan shall bear interest on the outstanding principal amount thereof from the applicable
borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate for the
Aggregate Commitments.




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





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




          (iii) Upon the request of the Required Lenders, so long as any Event of Default is
continuing, the Borrower shall pay interest on the principal amount of all outstanding
Obligations hereunder at a fluctuating interest rate per annum at all times equal to the
Default Rate to the fullest extent permitted by applicable Laws.




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



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




     2.09 Fees. Except as provided in Section 10.13, 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 (other than a Defaulting 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. For the avoidance of doubt, Swing Line Loans are not
deducted from Aggregate Commitments when calculating the commitment fee under this Section 2.09(a).
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
in arrears at the end of each calendar quarter, 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 Arrangers and the Administrative
Agent for their own respective accounts fees in the amounts and at the times



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specified in the Fee Letter. Such fees shall be fully earned when paid and shall not be
refundable for any reason whatsoever.





          (ii) The Borrower shall pay to the 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 Wells Fargo’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 presumed correct 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
presumed correct absent manifest error of the amount of the Credit Extensions made by the Lenders
to the Borrower and the interest and payments thereon. Any failure to so record or any error in
doing so shall not, however, limit or otherwise affect the obligation of the Borrower hereunder to
pay any amount owing with respect to the Obligations. In the event of any conflict between the
accounts and records maintained by any Lender and the accounts and records of the Administrative
Agent in respect of such matters, the accounts and records of the Administrative Agent shall
control in the absence of manifest error. 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 and Swing
Line Loans. In the event of any conflict between the accounts and records maintained by the
Administrative Agent and the accounts and records of any Lender in respect of such matters, the
accounts and records of the Administrative Agent shall control in the absence of manifest error.




          (c) The indebtedness of the Borrower to the Swing Line Lender resulting from Swing Line Loans
shall be evidenced by the Swing Line Note.




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     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 1:00 p.m. on the date
specified herein. The Administrative Agent will promptly distribute to each Lender its Applicable
Percentage (or other applicable share as provided herein) of such payment in like funds as received
by wire transfer to such Lender’s Lending Office. All payments received by the Administrative
Agent after 1:00 p.m. shall be deemed received on the next succeeding Business Day and any
applicable interest or fee shall continue to accrue. If any payment to be made by the Borrower
shall come due on a day other than a Business Day, payment shall be made on the next following
Business Day, and such extension of time shall be reflected 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 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 and may, in reliance upon such
assumption, make available to the Borrower a corresponding amount. In such event, if a Lender has
not in fact made its share of the applicable Borrowing available to the Administrative Agent, then
the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith
on demand such corresponding amount in immediately available funds with interest thereon, for each
day from and including the date such amount is made available to the Borrower to but excluding the
date of payment to the Administrative Agent, at (A) in the case of a payment to be made by such
Lender, the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in
accordance with banking industry rules on interbank compensation 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 an 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 an 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 an L/C Issuer, as the case may be, severally agrees to repay to
the Administrative Agent forthwith on



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demand the amount so distributed to such Lender or such L/C Issuer, in immediately
available funds with interest thereon, for each day from and including the date such amount
is distributed to it to but excluding the date of payment to the Administrative Agent, at
the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in
accordance with banking industry rules on interbank compensation.


A notice of the Administrative Agent to any Lender or the Borrower with respect to any amount owing
under this subsection (b) shall be presumed correct, 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 Swing Line Loans and to make payments
pursuant to Section 10.04(c) are several and not joint. The failure of any Lender to make
any Loan, to fund any such participation or to make any payment under Section 10.04(c) on
any date required hereunder shall not relieve any other Lender of its corresponding obligation to
do so on such date, and no Lender shall be responsible for the failure of any other Lender to so
make its Loan, to purchase its participation or to make its payment under Section 10.04(c).




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




     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 and Swing Line Loans of the other Lenders, or make such other adjustments as shall be
equitable, so that the benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of 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




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          (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 or Swing Line Loans to any assignee or
participant, other than to the Borrower or any 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 no Default has occurred and is continuing, 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; provided that (i) the Aggregate
Commitments shall not at any time exceed $450,000,000, (ii) any such request for an increase shall
be in a minimum amount of $10,000,000, or a whole multiple of $1,000,000 in excess thereof, and
(iii) 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 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 specified in the notice 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 Issuers and the Swing Line Lender (which approvals shall not be
unreasonably withheld), the Borrower may also invite additional Eligible Assignees to become
Lenders pursuant to a joinder agreement in form and substance satisfactory to the Administrative
Agent and its counsel.




          (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 each Loan Party



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dated as of the Increase Effective Date (i) signed by a Responsible Officer of such Loan Party
(A) certifying and attaching the resolutions adopted by such Loan Party approving or consenting to
such increase, and (B) in the case of the Borrower, certifying that, before and after giving effect
to such increase, (1) the representations and warranties contained in Article V and the other Loan
Documents are true and correct 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 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, and (2) no Default exists, (ii) new Notes to each
Lender who requests a Note, to the extent required as a result of the increase in the Aggregate
Commitments, and (iii) an opinion of counsel as to the corporate (or partnership or limited
liability company) authorization of the Borrower and the Guarantors of the increase, substantively
in the form delivered on the Closing Date. 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.




     2.15 Swing Line Loans.



          (a) The Swing Line. Subject to the terms and conditions set forth herein, and if an
AutoBorrow Agreement is in effect, subject to the terms and conditions of such AutoBorrow
Agreement, the Swing Line Lender may in its sole and absolute discretion, in reliance upon the
agreements of the other Lenders set forth in this Section 2.15, make loans (each such loan
and each transfer of funds pursuant to any AutoBorrow Agreement, a “Swing Line Loan”) to
the Borrower from time to time on any Business Day during the Availability Period in an aggregate
amount not to exceed at any time outstanding the amount of the Swing Line Sublimit, notwithstanding
the fact that such Swing Line Loans, when aggregated with the Applicable Percentage of the
Outstanding Amount of the Loans and L/C Obligations of the Lender acting as Swing Line Lender, may
exceed the amount of such Lender’s Commitment; provided, however, that after giving effect to any
Swing Line Loan, (i) the Total Outstandings shall not exceed the Aggregate Commitments at such
time, and (ii) the aggregate Outstanding Amount of the Loans of any Lender at such time, plus such
Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations at such time, plus
such Lender’s Applicable Percentage of the Outstanding Amount of all Swing Line Loans at such time
shall not exceed such Lender’s Commitment, and provided, further, that the Borrower shall not use
the proceeds of any Swing Line Loan to refinance any outstanding Swing Line Loan. Within the
foregoing limits, and subject to the other terms and conditions hereof and, if an AutoBorrow
Agreement is in effect, such additional terms and conditions of such AutoBorrow Agreement, the
Borrower may borrow under this Section 2.15, prepay under Section 2.04, and
reborrow under this Section 2.15. Each Swing Line Loan shall bear interest only at a rate
based on the Base Rate. Immediately upon the making of a Swing Line Loan, each Lender shall be
deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the Swing Line
Lender a risk participation in such Swing Line Loan in an amount equal to the product of such
Lender’s



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Applicable Percentage times the amount of such Swing Line Loan. If an AutoBorrow Agreement is
in effect and any of the terms of this Section 2.15(a) conflict with such AutoBorrow
Agreement, the terms of such AutoBorrow Agreement shall govern and control. No Lender shall have
any rights or obligations under any AutoBorrow Agreement, but each Lender shall have the obligation
to purchase and fund risk participations in the Swing Line Loans and to refinance Swing Line Loans
as provided in this Agreement. Borrower shall have the sole right to determine whether a Loan is
funded as a Swing Line Loan or as a Loan.




          (b) Borrowing Procedures. Each Swing Line Borrowing shall be made upon the Borrower’s
irrevocable notice to the Swing Line Lender and the Administrative Agent, which may be given by
telephone. Each such notice must be received by the Swing Line Lender and the Administrative Agent
not later than 1:00 p.m. on the requested borrowing date, and shall specify (i) the amount to be
borrowed, which shall be a minimum of $100,000, and (ii) the requested borrowing date, which shall
be a Business Day. Each such telephonic notice must be confirmed promptly by delivery to the Swing
Line Lender and the Administrative Agent of a written Swing Line Loan Notice, appropriately
completed and signed by a Responsible Officer of the Borrower. Promptly after receipt by the Swing
Line Lender of any telephonic Swing Line Loan Notice, the Swing Line Lender will confirm with the
Administrative Agent (by telephone or in writing) that the Administrative Agent has also received
such Swing Line Loan Notice and, if not, the Swing Line Lender will notify the Administrative Agent
(by telephone or in writing) of the contents thereof. Unless the Swing Line Lender has received
notice (by telephone or in writing) from the Administrative Agent (including at the request of any
Lender) prior to 2:00 p.m. on the date of the proposed Swing Line Borrowing (A) directing the Swing
Line Lender not to make such Swing Line Loan as a result of the limitations set forth in the first
proviso to the first sentence of Section 2.15(a), or (B) that one or more of the applicable
conditions specified in Article IV is not then satisfied, then, subject to the terms and conditions
hereof, the Swing Line Lender will, not later than 3:00 p.m. on the borrowing date specified in
such Swing Line Loan Notice, make the amount of its Swing Line Loan available to the Borrower at
its office by crediting the account of the Borrower on the books of the Swing Line Lender in
immediately available funds.




          (c) Refinancing of Swing Line Loans. (i) The Swing Line Lender at any time in its
sole and absolute discretion may request, on behalf of the Borrower (which hereby irrevocably
authorizes the Swing Line Lender to so request on its behalf), or the Borrower at any time in its
sole and absolute discretion may request, that each Lender make a Base Rate Loan in an amount equal
to such Lender’s Applicable Percentage of the amount of Swing Line Loans then outstanding. Such
request shall be made in writing (which written request shall be deemed to be a Loan Notice for
purposes hereof) and in accordance with the requirements of Section 2.02, without regard to
the minimum and multiples specified therein for the principal amount of Base Rate Loans, but
subject to the unutilized portion of the Aggregate Commitments and the conditions set forth in
Section 4.02. The Swing Line Lender or the Borrower, as applicable, shall furnish to the
other a copy of the applicable Loan Notice promptly after delivering such notice to the
Administrative Agent. Each Lender shall make an amount equal to its Applicable Percentage of the
amount specified in such Loan Notice available to the Administrative Agent in immediately available
funds for the account of the Swing Line Lender at the Administrative Agent’s Office not later than
1:00 p.m. on the day specified in such Loan Notice, whereupon, subject to Section
2.15(c)(ii), each Revolving Credit Lender that so makes



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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 Swing Line Lender.





          (ii) If for any reason any Swing Line Loan cannot be refinanced by such a Borrowing in
accordance with Section 2.15(c)(i), the request for Base Rate Loans submitted by the
Swing Line Lender or the Borrower as set forth herein shall be deemed to be a request by the
Swing Line Lender that each of the Revolving Credit Lenders fund its risk participation in
the relevant Swing Line Loan and each Lender’s payment to the Administrative Agent for the
account of the Swing Line Lender pursuant to Section 2.15(c)(i) shall be deemed
payment in respect of such participation.




          (iii) If any Lender fails to make available to the Administrative Agent for the account
of the Swing Line Lender any amount required to be paid by such Lender pursuant to the
foregoing provisions of this Section 2.15(c) by the time specified in Section
2.15(c)(i), the Swing Line Lender shall be entitled to recover from such Lender (acting
through the Administrative Agent), on demand, such amount with interest thereon for the
period from the date such payment is required to the date on which such payment is
immediately available to the Swing Line Lender at a rate per annum equal to the greater of
the Federal Funds Rate and a rate determined by the Swing Line Lender in accordance with
banking industry rules on interbank compensation, plus any administrative, processing or
similar fees customarily charged by the Swing Line Lender in connection with the foregoing.
If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid
shall constitute such Lender’s Loan included in the relevant Borrowing or funded
participation in the relevant Swing Line Loan, as the case may be. A certificate of the
Swing Line Lender submitted to any Lender (through the Administrative Agent) with respect to
any amounts owing under this clause (iii) shall be presumed correct absent manifest error.




          (iv) Each Lender’s obligation to make Loans or to purchase and fund risk participations
in Swing Line Loans pursuant to this Section 2.15(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
Swing Line Lender, 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 2.15(c) is subject to the
conditions set forth in Section 4.02. No such funding of risk participations shall
relieve or otherwise impair the obligation of the Borrower to repay Swing Line Loans,
together with interest as provided herein.



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




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



          (e) Interest for Account of Swing Line Lender. The Swing Line Lender shall be
responsible for invoicing the Borrower for interest on the Swing Line Loans. Until each Lender
funds its Base Rate Loan or risk participation pursuant to this Section 2.15 to refinance
such Lender’s Applicable Percentage of any Swing Line Loan, interest in respect of such Applicable
Percentage shall be solely for the account of the Swing Line Lender.




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




          (g) Discretionary Nature of the Swing Line Facility. Notwithstanding any terms to the
contrary contained herein or in any AutoBorrow Agreement, the Swing Line facility provided herein
or in any AutoBorrow Agreement (i) is an uncommitted facility and the Swing Line Lender may, but
shall not be obligated to, make Swing Line Loans, and (ii) may be terminated at any time by the
Swing Line Lender or Borrower upon written notice by the terminating party to the non-terminating
party.




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 or 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.




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          (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, to the extent such Other Taxes are imposed on the
Borrower or any obligation of it hereunder under applicable law.




          (c) Indemnification by the Borrower. The Borrower shall indemnify the Administrative
Agent, each Lender and each L/C Issuer, within 30 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 such 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 an 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 an L/C Issuer, shall be presumed correct absent
manifest error. However, neither the Administrative Agent, any Lender nor any L/C Issuer shall be
entitled to receive any payment with respect to Indemnified or Other Taxes that are incurred or
accrued more that 270 days prior to the date the Administrative Agent, such Lender or such L/C
Issuer gives notice and demand thereof to the Borrower.




          (d) Evidence of Payments. As soon as reasonably 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. Any 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, at the time or times prescribed by law or
reasonably requested by the 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. Each
Lender shall promptly notify the Borrower and the Administrative Agent of any change in
circumstances which would modify or render invalid any claimed exemption or reduction.




     Without limiting the generality of the foregoing, any 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



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Agreement (and from time to time thereafter upon the request of the Borrower or the
Administrative Agent or as required by applicable law, but only if such Foreign Lender is legally
entitled to do so), whichever of the following is applicable:




          (i) duly completed copies of IRS Form W-8BEN claiming the benefits of the portfolio
interest exemption pursuant to subsection (iii) below or eligibility for benefits of an
income tax treaty to which the United States is a party,




          (ii) duly completed copies of IRS 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 “10 percent shareholder” of the Borrower within the meaning of section
881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation” described in section
881(c)(3)(C) of the Code or (D) that such payments are not effectively connected with such
Foreign Lender’s conduct of a trade or business in the United States, and (y) duly completed
copies of IRS 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) Treatment of Certain Refunds. If the Administrative Agent, any Lender or any L/C
Issuer determines in good faith 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 such L/C Issuer, as
the case may be, and without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund), provided that the Borrower, upon the request of the
Administrative Agent, such Lender or such L/C Issuer, agrees to repay the amount paid over to the
Borrower (plus any penalties, interest or other charges imposed by the relevant Governmental
Authority) to the Administrative Agent, such Lender or such L/C Issuer in the event the
Administrative Agent, such Lender or such L/C Issuer is required to repay such refund to such
Governmental Authority, in which case the Administrative Agent, such Lender or such L/C Issuer
shall provide evidence that such refund is due to such Governmental Authority. This subsection
shall not be construed to require the Administrative Agent, any Lender or such 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 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, or any Governmental Authority has imposed material



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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 for any requested Interest Period with
respect to a proposed Eurodollar Rate Loan, or (c) the Eurodollar 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 or for the account
of, or credit extended or participated in by, any Lender (except any reserve requirement
reflected in the Eurodollar) or any L/C Issuer;




          (ii) subject any Lender or any 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 such 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 such L/C Issuer); or



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          (iii) impose on any Lender or any L/C Issuer or the London interbank market any other
condition, cost or expense affecting this Agreement or 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 such L/C Issuer of participating in, issuing or maintaining
any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of
Credit), or to reduce the amount of any sum received or receivable by such Lender or such L/C
Issuer hereunder (whether of principal, interest or any other amount) then, upon request of such
Lender or such L/C Issuer, the Borrower will pay to such Lender or such L/C Issuer, as the case may
be, such additional amount or amounts as will compensate such Lender or such L/C Issuer, as the
case may be, for such additional costs incurred or reduction suffered.




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




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




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




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     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 for such Loan by a matching deposit or other borrowing in the London interbank
eurodollar market for a comparable amount and for a comparable period, whether or not such
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, 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.



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ARTICLE IV




CONDITIONS PRECEDENT TO CREDIT EXTENSIONS




     4.01 Conditions of Initial Credit Extension. The obligation of each L/C Issuer and each
Lender to make its initial Credit Extension hereunder 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;




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




          (iii) such certificates of resolutions or other action, incumbency certificates and/or
other certificates of a secretary or assistant secretary or similar officer 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;




          (iv) 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 Loan
Party is validly existing, in good standing and qualified to engage in business in its
jurisdiction of incorporation or formation;




          (v) (A) a favorable opinion of Fulbright and Jaworski, L.L.P., counsel to the Loan
Parties, addressed to the Administrative Agent and each Lender, as to the matters set forth
in Exhibit F;




          (vi) 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 the Borrower and the validity against the Borrower 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;




          (vii) a certificate signed by a Responsible Officer of the Borrower certifying (A) that
the representations and warranties of the Borrower contained in Article V are true and
correct as of the Closing Date, (B) no Default or Event of Default has occurred and is
continuing as of such date, and (C) that there has been no event or



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circumstance since the date of the Audited Financial Statements that has had or could
be reasonably expected to have or result in, either individually or in the aggregate, a
material adverse effect upon, or a material adverse change in, the business, assets,
liabilities (actual or contingent), operations, condition (financial or otherwise) or
prospects of the Borrower and its Subsidiaries taken as a whole;




          (viii) a duly completed Compliance Certificate as of the last day of the fiscal quarter
of the Borrower most recently ended prior to the Closing Date, signed by a Responsible
Officer of the Borrower;




          (ix) evidence satisfactory to the Administrative Agent of the termination of the
Borrower’s existing revolving credit agreement and repayment of all amounts due thereunder
on or before the Closing Date; and




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



          (b) Any fees required to be paid on or before the Closing Date shall have been paid.




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




     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, or which are contained in any document furnished at
any time under or in connection herewith or therewith, shall be true and correct 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



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deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b),
respectively, of Section 6.01.




          (b) No Default or Event of Default shall have occurred and be continuing, or would result from
such proposed Credit Extension or from the application of the proceeds thereof.




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




          (d) No statute, rule, regulation or other legal requirement shall have been promulgated or
enacted and be in effect that on a permanent basis restrains, enjoins, or prohibits the Lenders
from making such Credit Extension.




     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 (b) have been satisfied on and as of the date of the applicable Credit
Extension.



ARTICLE V




REPRESENTATIONS AND WARRANTIES




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



     5.01 Existence, Qualification and Power; 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 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; 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) violate the terms
of any of such Person’s Organization Documents; (b) violate or result in any breach 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 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



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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.



     5.04 Binding Effect. This Agreement has been, and each other Loan Document, when delivered
hereunder, will have been, duly executed and delivered by each Loan Party that is party thereto.
This Agreement constitutes, and each other Loan Document when so delivered will constitute, a
legal, valid and binding obligation of such Loan Party, enforceable against each Loan Party that is
party thereto in accordance with its terms, except as may be limited by bankruptcy, insolvency,
moratorium, fraudulent transfer and fraudulent conveyance laws, and other similar laws and
provisions, and general principles of equity.



     5.05 Financial Statements; No Material Adverse Effect.



          (a) The Audited Financial Statements (i) were prepared in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly noted therein; (ii)
fairly present 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, material commitments
and Indebtedness.




          (b) From the period commencing on the date of the Audited Financial Statements and ending on
the Closing Date, 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.




     5.06 Litigation. There are no actions, suits, 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 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 any of the transactions contemplated
hereby, or (b) as to which there is a reasonable possibility of an adverse determination, and that,
if determined adversely, could reasonably be expected, either individually or in the aggregate, to
have a Material Adverse Effect.



     5.07 No Default. 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 Subsidiary has good record
and indefeasible title in fee simple 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



-52-









 







not, individually or in the aggregate, reasonably be expected to have a Material Adverse
Effect. The property of the Borrower and its Subsidiaries is subject to no Liens, other than Liens
permitted by Section 7.01.



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



     5.10 Insurance. The properties of the Borrower and its 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 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. Neither the Borrower nor any of its
Subsidiaries have received any written notice from any Governmental Authority proposing a 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, with any Person other than the
Borrower or a Subsidiary of the Borrower, to any tax sharing agreement; provided that the
allocation of taxes in connection with a business acquisition agreement does not constitute a tax
sharing agreement.



     5.12 ERISA Compliance.



          (a) Except as could not reasonably be expected to have a Material Adverse Effect, 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 or opinion 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, no event or circumstance has occurred or exists which would prevent, or cause the
loss of, such qualification. The Borrower and each ERISA Affiliate have made all material amounts
of 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.




          (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



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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 that, when taken
together with each other ERISA Event that has occurred or is reasonably expected to occur, could
reasonably be expected to result in a Material Adverse Effect; (ii) the Unfunded Pension Liability
of all Pension Plans does not exceed the Threshold Amount; and (iii) 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. As of the Closing Date, 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 validly issued, are fully paid and
nonassessable and are owned by a Loan Party in the amounts specified on Part (a) of Schedule
5.13 free and clear of all Liens. As of the Closing Date, the Borrower has no equity
investments in any other corporation or entity other than those specifically disclosed in Part (b)
of Schedule 5.13.



     5.14 Margin Regulations; Investment Company Act.



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




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




     5.15 Disclosure. The Borrower has disclosed to the Administrative Agent and the Lenders, or
has stated in filings with the Securities and Exchange Commission of the type described in
Section 6.02(d), all agreements, instruments and corporate or other restrictions to which
it or any of its 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 information furnished (whether in writing or orally) by
or on behalf of any Loan Party to the Administrative Agent or any Lender in connection with the
transactions contemplated hereby and the negotiation of this Agreement or delivered hereunder or
under any other Loan Document (in each case, as modified or supplemented by, or read in conjunction
with, other information so furnished) contains any material misstatement of fact or, when read
together with filings with the Securities and Exchange Commission of the type described in
Section 6.02(d), omits to state any material fact necessary to make the statements therein,
in the light of the circumstances under which they were



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made, not misleading in any material respect; 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. The Borrower has given all
notices required to be delivered pursuant to Section 6.03.



     5.16 Compliance with Laws. Each of the Borrower and each 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.



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 Subsidiary 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, its Annual Report, the Form 10-K, or its equivalent, of the Borrower, for such fiscal
year that includes a consolidated balance sheet of the Borrower and its Subsidiaries as at the end
of such fiscal year, and the related consolidated statements of income or operations, shareholders’
equity and cash flows for such fiscal year, setting forth in each case in comparative form the
figures for the previous fiscal year, all in reasonable detail and prepared in accordance with
GAAP, audited and accompanied by a report and opinion of an independent certified public accountant
of nationally recognized standing reasonably acceptable to the Required Lenders, which report and
opinion shall be prepared in accordance with generally accepted auditing standards and shall not be
subject to any “going concern” or like qualification or exception or any qualification or exception
as to the scope of such audit; and




          (b) as soon as available, but in any event within 45 days after the end of each of the first
three fiscal quarters of each fiscal year of the Borrower, its Quarterly Report on Form 10-Q, or
its equivalent, of the Borrower that includes a consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of such fiscal quarter, and the related consolidated statements of
income or operations, shareholders’ equity and cash flows for such fiscal quarter and for the
portion of the Borrower’s fiscal year then ended, setting forth in each case in comparative form
the figures for the corresponding fiscal quarter of the previous fiscal year and the corresponding
portion of the previous fiscal year, all in reasonable detail, and that includes a certification of
a Responsible Officer of the Borrower in accordance with applicable law and regulations,
certifying that the foregoing fairly presents the financial condition, results of



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operations, shareholders’ equity and cash flows of the Borrower and its Subsidiaries in
accordance with GAAP, subject only to normal year-end audit adjustments and the absence of
footnotes (provided, however, that the requirement for certification contained in this paragraph
(b) shall be deemed satisfied by a certification of a Responsible Officer made in conjunction with
a Form 10-Q as required by the Sarbanes-Oxley Act of 2002 as in effect on the Closing Date (or as
subsequently amended if such law as amended requires a certification that is more comprehensive
than, or substantially similar to, the certification required by this paragraph (b)).




     As to any information contained in materials furnished pursuant to Section 6.02, 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 satisfactory to the Administrative Agent and the Required Lenders:



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




          (b) concurrently with the delivery of the financial statements referred to in Sections
6.01(a) 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;




          (d) promptly after the same are available the following (provided, however, that the
requirement to deliver the following may be satisfied by giving notice as provided in the last
paragraph of this Section 6.02): (i) each report on Form 8-K (other than earnings reports)
and effective registration statement filed with the Securities and Exchange Commission, and (ii)
each annual report, proxy, financial statement or other report sent to the stockholders of the
Borrower, to the extent that such items are not otherwise required to be delivered to the
Administrative Agent pursuant hereto;




          (e) promptly after the furnishing thereof, copies of any statement or report other than those
related to ministerial matters furnished to any holder of debt securities of any Loan Party or any
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;




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




          (g) the items required to be delivered pursuant to Schedule 4.01 within the time
periods therein specified; and




          (h) 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.




     The Borrower shall be deemed to have satisfied the requirement to deliver documents pursuant
to Section 6.01(a) or (b) or Section 6.02(d) if such documents shall have
been timely made available on “EDGAR” and/or on the Borrower’s home page on the world wide web (as
of the date of this Agreement located at www.patenergy.com). Notwithstanding anything contained
herein, in every instance the Borrower shall be required to provide to the Administrative Agent a
copy by electronic mail of the Compliance Certificates required by Section 6.02(b) and the
financial statements referred to in Section 6.01(a) and (b). Except for such
Compliance Certificates, 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.



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



          (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 Subsidiary; (ii) any dispute, litigation, 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; and




          (d) of any material change in accounting policies or financial reporting practices by the
Borrower or any Subsidiary.




     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.




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     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 Subsidiary; (b) all lawful claims which, if unpaid,
would by law become a Lien upon its property, except those that are being contested in good faith
by appropriate proceedings and for which adequate reserves have been established in accordance with
GAAP; and (c) all Indebtedness, as and when due and payable, but subject to any subordination
provisions contained in any instrument or agreement evidencing such Indebtedness.



     6.05 Preservation of Existence, Etc. (a) Preserve, renew and maintain in full force and
effect its legal existence and good standing under the Laws of the jurisdiction of its organization
except in a transaction permitted by Section 7.04; (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 failure to preserve any 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 accordance with industry
practices; (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 the same or
similar business, of such types and in such amounts as are customarily carried under similar
circumstances by such other Person.



     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 and account, in which full, true and
correct entries in conformity with GAAP consistently applied shall be made of all financial
transactions and matters involving the assets and business of the Borrower or such 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



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



     6.11 Use of Proceeds. Use the proceeds of the Credit Extensions for working capital, capital
expenditures, letters of credit, acquisitions, repurchases by the Borrower of the Borrower’s
capital stock and general corporate purposes not in contravention of any Law or of any Loan
Document; provided, however, no portion of the proceeds of any Credit Extension will be used in any
manner prohibited by Section 7.09.



     6.12 Additional Guarantors. Notify the Administrative Agent within 10 days after the date
that any Person becomes a Domestic Subsidiary other than an Immaterial Subsidiary, and within 10
days after the date that any Person becomes a Domestic Subsidiary other than an Immaterial
Subsidiary, cause such Person to (a) become a Guarantor by executing and delivering to the
Administrative Agent a counterpart of the Guaranty or such other document as the Administrative
Agent shall deem appropriate for such purpose, and (b) deliver to the Administrative Agent
documents of the types referred to in clauses (iii) and (iv) of Section 4.01(a) and
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)), all in
form, content and scope reasonably satisfactory to the Administrative Agent.



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 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, and (iii) the direct or any contingent obligor with
respect thereto is not changed;




          (c) Liens for taxes or unpaid utilities 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;




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          (d) 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 60 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 bonds (other than bonds related to judgments or
litigation), performance bonds and other obligations of a like nature incurred in the ordinary
course of business;




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




          (h) (i) Liens securing purchase money obligations of the Borrower or of Subsidiaries of the
Borrower, for fixed or capital assets acquired after the Closing Date, provided that (A) such Liens
do not at any time encumber any property other than the property financed by such Indebtedness, (B)
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 and (C) such Liens attach to such
property concurrently with or within 90 days after the acquisition thereof, and (ii) Liens securing
any refinancing of such Indebtedness, provided that such Liens do not extend to additional property
and the amount of the Indebtedness is not increased;




          (i) Liens securing judgments for the payment of money not constituting an Event of Default
under Section 8.01(h) or securing appeal or other surety bonds related to such judgments;




          (j) Liens arising in the ordinary course of business under Oil and Gas Agreements to secure
compliance with such agreements, provided that any such Lien referred to in this clause are for
claims which are not delinquent or which are being contested in good faith by appropriate action
and for which adequate reserves have been maintained in accordance with GAAP, and provided,
further, that any such Lien referred to in this clause does not materially impair the use of the
property covered by such Lien for the purposes for which such property is held by the Borrower or
any Subsidiary or materially impair the value of such property subject thereto, and provided,
further, that such Liens are limited to property that is the subject of the relevant Oil and Gas
Agreement and any proceeds thereof; and




          (k) Liens not otherwise permitted by this Section 7.01 if at the time of, and after
giving effect to, the creation or assumption of any such Lien, the aggregate of all obligations of
the Borrower and its Subsidiaries secured by any Liens not otherwise permitted hereby does not
exceed 10% of Consolidated Net Worth of the Borrower and its Subsidiaries.




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     7.02 Foreign Subsidiaries and Joint Ventures.




          (a) Make or permit any Domestic Subsidiary to make any Investment in any Foreign Subsidiary or
any Joint Venture unless the book value of all Investments (including such Investment then being
made) in Foreign Subsidiaries and Joint Ventures made on or after the Closing Date does not exceed
an amount equal to 30% of the total book value of all assets of the Borrower and its Subsidiaries
calculated on a pro forma basis taking into account such Investment; or




          (b) Incur any Indebtedness owed by the Borrower to any Foreign Subsidiary or other Subsidiary
that is not a Guarantor unless such Indebtedness is subordinated to the Obligations pursuant to
terms that are substantially the same as the subordination terms applicable to the Guarantors
pursuant to the Guaranty.




     7.03 Indebtedness of Subsidiaries. Permit any Subsidiary of the Borrower to create, incur,
assume or suffer to exist any Indebtedness, except:



          (a) Indebtedness under the Loan Documents;




          (b) Guarantees in respect of Indebtedness otherwise permitted hereunder of the Borrower;




          (c) Indebtedness owed by any Subsidiary to (i) the Borrower, or (ii) another Subsidiary,
provided that if such Subsidiary to whom such Indebtedness is owed is not a Guarantor, then such
Indebtedness (other than Indebtedness owed by a Foreign Subsidiary to another Foreign Subsidiary)
shall be subordinated to the Obligations pursuant to terms substantially the same as the
subordination terms applicable to the Guarantors pursuant to the Guaranty;




          (d) purchase money Indebtedness permitted by Section 7.01(h); and




          (e) unsecured Indebtedness, provided that (i) both before and after such Indebtedness is
created, incurred or assumed, no Default or Event of Default shall have occurred and be continuing,
and (ii) the aggregate outstanding principal amount of such Indebtedness for all Subsidiaries taken
together shall not exceed at any time an amount equal to 10% of Consolidated Net Worth.




          (f) secured Indebtedness, provided that (i) both before and after such Indebtedness is
created, incurred or assumed, no Default or Event of Default shall have occurred and be continuing,
and (ii) the aggregate outstanding principal amount of such Indebtedness for all Subsidiaries taken
together shall not exceed at any time an amount equal to 5% of Consolidated Net Worth.




     7.04 Fundamental Changes. (A) Wind up, liquidate or dissolve its affairs, or (B) amalgamate
or consolidate with, or merge into, or sell, lease or otherwise dispose of, in one transaction or a
series of transactions, all or substantially all of its assets to, any other Person, or permit any
other Person to amalgamate or consolidate with, or merge into, or sell, lease or otherwise dispose
of all or substantially all of its assets to, it, except that this Section 7.04 shall



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not prohibit any of the following transactions, or any agreement to effect the same, provided
that no Default has occurred and is continuing or would result therefrom:



          (a) any amalgamation, consolidation or merger, or sale or other disposition of assets (other
than by lease) involving the Borrower or any of its consolidated Subsidiaries, provided that





          (i) in any such transaction involving the Borrower, the Borrower is the surviving,
resulting or continuing Person in such merger, amalgamation or consolidation, or the
transferee in such sale or other disposition (in any such case, the “Survivor”),




          (ii) in any such transaction involving any Guarantor,




          (iii) the entity that constituted the Guarantor immediately prior thereto is the
Survivor, or



          (b) the Guarantor shall have amalgamated or merged with and into the Borrower and the Borrower
shall be the Survivor, or




          (c) if neither the entity that constituted the Guarantor immediately prior thereto nor the
Borrower is the Survivor, the Survivor shall execute and deliver to the Administrative Agent an
instrument, in form and substance satisfactory to it, whereby the Survivor shall assume all rights
and obligations of the Guarantor under the Guaranty to which the Guarantor is a party),





          (i) in any such transaction not involving the Borrower or a Guarantor, a wholly-owned
Subsidiary of the Borrower is the Survivor, and




          (ii) in the case of any transaction specified in the foregoing clause (i), (ii) or
(iii) (A) the Borrower, the Guarantor (except in a case specified in clause (ii)(y)) and
their Subsidiaries shall be in compliance, on a pro forma basis after giving effect to such
transaction, with the covenants contained in this Article VII recomputed as of the last day
of the most recently ended fiscal quarter of the Borrower, the Guarantor and their
Subsidiaries as if such transaction had occurred on the first day of each relevant period
for testing such compliance, (B) with respect to any amalgamation, consolidation or merger,
or sale or other disposition of assets with or to a Person not a consolidated Subsidiary of
the Borrower, the Borrower shall have delivered to the Administrative Agent an officer’s
certificate to such effect, together with all relevant financial information and
calculations demonstrating such compliance and (C) in a transaction of the type described in
clause (a)(ii) or (a)(iii) above in which a Guarantor is not the Survivor, the
Administrative Agent shall have received an opinion reasonably satisfactory in form, scope
and substance to the Administrative Agent, of counsel reasonably satisfactory to the
Administrative Agent, addressing such matters in connection with such transaction as the
Administrative Agent or such Lender may reasonably request, and such other documentation as
the Administrative Agent may reasonably request;



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          (d) any winding up, liquidation or dissolution of any consolidated Subsidiary if in the
reasonable judgment of the board of directors (or other managing group) of such Subsidiary, such
winding up, liquidation or dissolution is in the best interests of the Borrower and its
consolidated Subsidiaries taken as a whole and is not materially disadvantageous to any Lender,
provided, however, with respect to any winding up, liquidation or dissolution of any Guarantor the
owner of all of the capital stock of the Guarantor immediately prior to such event shall be the
Borrower or a wholly-owned Subsidiary of the Borrower;




          (e) transactions and transfers of assets among or between Loan Parties, or among and between
Loan Parties and wholly-owned Subsidiaries or among and between wholly-owned Subsidiaries, provided
that any transaction or transfers described in this clause (c) that involves the Borrower shall be
subject to the requirements of Section 7.04(a)(i) and any transaction or transfer that
involves a Guarantor shall be subject to the requirements of Section 7.04(a)(ii); and




          (f) dispositions (whether in the form of a sale of assets or by merger) not otherwise
permitted hereunder which are made for fair market value; provided that (i) any merger shall be
subject to the requirements set forth in Section 7.04(a), (ii) the aggregate sales price
from such disposition shall be paid in cash or otherwise on payment terms satisfactory to the
applicable Loan Party or Subsidiary, and (iii) the aggregate book value of all assets of the
Borrower and its consolidated Subsidiaries, taken as a whole, shall not be reduced at any time to
an amount which is less than the Asset Threshold Value. As used in this Section “Asset
Threshold Value” means an amount equal to 80% of the aggregate book value of all assets of the
Borrower and its consolidated Subsidiaries, taken as a whole, on December 31, 2008, as reflected in
the Audited Financial Statements. No disposition (or series of dispositions) shall be permitted
if, following such disposition or series of dispositions, the aggregate book value of all assets of
the Borrower and its consolidated Subsidiaries, taken as a whole, would be less than the Asset
Threshold Value.




     7.05 Hedging Agreements. Enter into any Swap Contracts other than in the ordinary course of
business for the purpose of directly mitigating risks to which the Borrower or its Subsidiaries are
exposed in the conduct of their business and not for purposes of speculation.



     7.06 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 Subsidiaries on the date
hereof or any business substantially related or incidental thereto.



     7.07 Transactions with Affiliates. Enter into any material 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 Subsidiary as would be
obtainable by the Borrower or such Subsidiary at the time in a comparable arm’s length transaction
with a Person other than an Affiliate, except that the foregoing shall not apply to transactions
among the Borrower and one or more of its wholly-owned Subsidiaries, or between or among the
Borrower’s wholly-owned Subsidiaries.



     7.08 Burdensome Agreements. Enter into any Contractual Obligation (other than this Agreement
or any other Loan Document) that limits the ability of any Subsidiary to pay



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dividends or make other payments or distributions to the Borrower or any Guarantor or to
otherwise transfer property to the Borrower or any Guarantor, except restrictions that could not
reasonably be expected to impair the Borrower’s ability to repay the Obligations as and when due.



     7.09 Use of Proceeds.




          (a) Use the proceeds of any Credit Extension, whether directly or indirectly 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; or




          (b) Use the proceeds of any Credit Extension in connection with the acquisition of a voting
interest of five percent or more in any Person if such acquisition is opposed by the board of
directors or management of such Person.




     7.10 Financial Covenants.




          (a) Permit the Debt to Capitalization Ratio, expressed as a percentage, to exceed 35% at any
time.




          (b) Permit the Interest Coverage Ratio as of the last day of a fiscal quarter to be less than
3.00 to 1.00.




ARTICLE VIII




EVENTS OF DEFAULT AND REMEDIES




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



          (a) Non-Payment. The Borrower or any other Loan Party fails to 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 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 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(a), 6.05(a) or 6.11 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 delivery of written notice
thereof to the Borrower from the Administrative Agent acting on the instructions of any Lender; 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




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connection herewith or therewith shall be incorrect or misleading when made or deemed made; or




          (e) Cross-Default. (i) The Borrower or any 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 Swap Contracts) having an aggregate principal amount (including undrawn committed or
available amounts and including amounts owing to all creditors under any combined or syndicated
credit arrangement) of more than 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 Swap Contract an Early
Termination Date (as defined in such Swap Contract) resulting from (A) any event of default under
such Swap Contract as to which the Borrower or any Subsidiary is the Defaulting Party (as defined
in such Swap Contract) or (B) any Termination Event (as so defined) under such Swap Contract as to
which the Borrower or any Subsidiary is an Affected Party (as so defined) and, in either event, the
Swap Termination Value owed by the Borrower or such Subsidiary as a result thereof is greater than
the Threshold Amount; or




          (f) Insolvency Proceedings, Etc. Any Loan Party or any of its Subsidiaries 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, or similar officer for it or for all or any
material part of its property; or any receiver, trustee, custodian, conservator, liquidator, 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 the Borrower or any of its Subsidiaries
shall take any corporate, partnership or company action in furtherance of the foregoing; 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 property of such Person if such property is a material part of the property of
the Borrower and its Subsidiaries taken as a whole 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 Subsidiary (i) a final
judgment or order for the payment of money in an aggregate amount exceeding the



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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) the same shall remain undischarged for a period of 20 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 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 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 Loan Document; or




          (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 Issuers
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, notice of intent to
accelerate, notice of acceleration, 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 or applicable Law;



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 Issuers to make L/C Credit Extensions


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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 and interest) payable to the Lenders and the L/C Issuers (including
fees, charges and disbursements of counsel to the respective Lenders and the respective L/C Issuers
and amounts payable under Article III), ratably among them in proportion to the amounts described
in this clause Second payable to them;



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



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



     Fifth, to the Administrative Agent for the accounts of the L/C Issuers, 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.



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ARTICLE IX




ADMINISTRATIVE AGENT




     9.01 Appointment and Authority. Each of the Lenders and each L/C Issuer hereby irrevocably
appoints Wells Fargo to act on its behalf as the Administrative Agent hereunder and under the other
Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and to
exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof,
together with such actions and powers as are reasonably incidental thereto. The provisions of this
Article are solely for the benefit of the Administrative Agent, the Lenders and the L/C Issuers,
and 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.



     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



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



     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 Issuers and the Borrower. Upon receipt of any
such notice of resignation, the Required Lenders shall have the right, in consultation with the
Borrower, to appoint a successor, which shall be a bank with an office in the United States, or an
Affiliate of any such bank with an office in the United States. If no such



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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 Issuers, 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 Issuers 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 each 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 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 Wells Fargo as Administrative Agent pursuant to this Section shall also
constitute its resignation as an L/C Issuer and Swing Line Lender. 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 and
Swing Line Lender, (b) the retiring L/C Issuer and Swing Line Lender 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 arrangement 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 each L/C Issuer
acknowledges that it has, independently and without reliance upon the Administrative Agent or any
other Lender or any of their Related Parties and based on such documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each
Lender and each L/C Issuer also acknowledges that it will, independently and without reliance upon
the Administrative Agent or any other Lender or any of their Related Parties and based on such
documents and information as it shall from time to time deem appropriate, continue to make its own
decisions in taking or not taking action under or



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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 or agents, if any, listed on the cover page hereof shall have any powers,
duties or responsibilities under this Agreement or any of the other Loan Documents, except in its
capacity, as applicable, as the Administrative Agent, a Lender or an L/C Issuer hereunder.



     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 Issuers and the Administrative Agent (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Lenders, the L/C Issuers and the
Administrative Agent and their respective agents and counsel and all other amounts due the Lenders,
the L/C Issuers and the Administrative Agent under Sections 2.03(i) and (j),
2.09 and 10.04) allowed in such judicial proceeding; and




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



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




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



     9.10 Guaranty Matters. The Lenders and the L/C Issuers irrevocably authorize the
Administrative Agent, at its option and in its discretion, to release any Guarantor from its
obligations under the Guaranty if such Person ceases to be a Subsidiary as a result of a
transaction permitted hereunder.



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     Upon request by the Administrative Agent at any time, the Required Lenders will confirm in
writing the Administrative Agent’s authority 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 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(a) 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 payment of
principal, interest, fees or other amounts due to the Lenders (or any of them) 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 (iv) of the second proviso to this Section 10.01) any fees
or other amounts payable hereunder or under any other Loan Document 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; or




          (g) release all or substantially all of the Guarantors from the Guaranty without the written
consent of each Lender;




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and, provided, further, that (i) no amendment, waiver or consent shall, unless in writing and
signed by an L/C Issuer in addition to the Lenders required above, affect the rights or duties of
such L/C Issuer under this Agreement or any Issuer Document relating to any Letter of Credit issued
or to be issued by it; (ii) no amendment, waiver or consent shall, unless in writing and signed by
the Swing Line Lender in addition to the Lenders required above, affect the rights or duties of the
Swing Line Lender under this Agreement; (iii) no amendment, waiver or consent shall, unless in
writing and signed by the Administrative Agent in addition to the Lenders required above, affect
the rights or duties of the Administrative Agent under this Agreement or any other Loan Document;
(iv) 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; 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 an 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 Issuers 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 any L/C Issuer
pursuant to Article II if such Lender or such L/C Issuer, as applicable, has notified the
Administrative Agent that it is incapable of receiving notices under



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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.



     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) Change of Address, Etc. Each of the Borrower, the Administrative Agent and the
L/C Issuers 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 Issuers.



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



     10.03 No Waiver; Cumulative Remedies. No failure by any Lender, any L/C Issuer or the
Administrative Agent to exercise, and no delay by any such Person in exercising, any right, remedy,
power or privilege hereunder 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



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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 an L/C Issuer in connection with the issuance, amendment, renewal or
extension of any Letter of Credit or any demand for payment thereunder and (iii) all out of pocket
expenses incurred by the Administrative Agent, any Lender or any L/C Issuer (including the fees,
charges and disbursements of any counsel for the Administrative Agent, any Lender or any L/C
Issuer), in connection with the enforcement or protection of its rights (A) in connection with this
Agreement and the other Loan Documents, including its rights under this Section, or (B) in
connection with 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 each L/C Issuer, and each Related Party of any
of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold
each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related
expenses (including the fees, charges and disbursements of any counsel for any Indemnitee),
incurred by any Indemnitee or asserted against any Indemnitee by any third party or by the Borrower
or any other Loan Party arising out of, in connection with, or as a result of (i) the syndication
of the credit facilities provided for herein, the preparation, negotiation 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, (ii) any Loan or
Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by an
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 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.




          (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 Issuers or any Related Party of any
of the foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such
sub-agent), an 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



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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 an 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 an 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(d).




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




          (e) Payments. All amounts due under this Section shall be payable not later than ten
Business Days after demand therefor.




          (f) Survival. The agreements in this Section shall survive the resignation of the
Administrative Agent and an 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.




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



     10.06 Successors and Assigns.




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          (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 the Borrower may not assign or otherwise transfer any of its
rights or obligations hereunder without the prior written consent of the Administrative Agent and
each Lender and no Lender may assign or otherwise transfer any of its rights or obligations
hereunder except (i) to an 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 Issuers and the Lenders) any legal or equitable right, remedy or claim under or by
reason of this Agreement.




          (b) Assignments by Lenders. Any Lender may at any time assign to one or more 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);



          (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 Issuers 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 of $3,500
(unless the Eligible Assignee is an Affiliate of a Lender, in


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 which case such fee shall not apply), 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 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 presumed correct, 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 Issuers 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 wishing to consult with other Lenders in connection therewith 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 Issuers 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



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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 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 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



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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 may (i) with notice to, but
without prior consent of the Borrower and the Administrative Agent and without paying any
processing fee therefor, 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 either L/C Issuer assigns all of its Commitment and Loans
pursuant to subsection (b) above, such L/C Issuer may, (i) 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 Wells Fargo or Bank of America as L/C Issuer. If either Wells Fargo or Bank of
America resigns as L/C Issuer, such bank shall retain all the rights and obligations of such 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)).




     10.07 Treatment of Certain Information; Confidentiality.




          (a) Each of the Administrative Agent, the Lenders and the L/C Issuers agrees to maintain the
confidentiality of the Information (as defined below), except that Information may be disclosed (i)
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), (ii) 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), (iii) to the extent required by applicable laws
or regulations or by any subpoena or similar legal process, (iv) to any other party hereto, (v) 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, (vi) subject to an agreement containing provisions substantially
the same as those of this Section, to (A) any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or



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obligations under this Agreement or (B) any actual or prospective counterparty (or its
advisors) to any swap or derivative transaction relating to the Borrower and its obligations, (vii)
with the consent of the Borrower or (viii) 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, any L/C Issuer or any of their respective Affiliates on a
nonconfidential basis from a source other than the Borrower.




     For purposes of this Section 10.07(a), “Information” means all information
received from the Borrower or any Subsidiary relating to the Borrower or any Subsidiary or any of
their respective businesses, other than any such information that is available to the
Administrative Agent, any Lender or any L/C Issuer on a nonconfidential basis prior to disclosure
by the Borrower or any Subsidiary, provided that, in the case of information received from the
Borrower or any Subsidiary after the date hereof, such information is clearly identified at the
time of delivery as confidential. Any Person required to maintain the confidentiality of
Information as provided in this Section shall be considered to have complied with its obligation to
do so if such Person has exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.



          (b) The Borrower agrees that the Fee Letter and any commitment letter executed in connection
herewith are confidential, and agrees not to disclose any information contained in any such letter
except upon the terms therein set forth.




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



     10.09 Interest Rate Limitation. Notwithstanding anything to the contrary contained in any
Loan Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the
maximum rate of non-usurious interest permitted by applicable Law (the “Maximum Rate”). If
the Administrative Agent or any Lender shall receive interest in an amount that exceeds the Maximum
Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such
unpaid principal, refunded to the Borrower. In determining whether the



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interest contracted for, charged, or received by the Administrative Agent or a Lender exceeds
the Maximum Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any
payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude
voluntary prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in
equal or unequal parts the total amount of interest throughout the contemplated term of the
Obligations hereunder.



     To the extent that the interest rate laws of the State of Texas are applicable to the Loans
for purposes of determining the “maximum rate” or the “maximum amount,” then those terms mean the
“weekly ceiling” from time to time in effect under Texas Finance Code § 303.001, as limited by
Texas Finance Code § 303.009, and, to the extent that this Agreement is deemed an open end account
as such term is defined in Texas Finance Code Section 301.002(a)(14), the Lenders retain the right
to modify the interest rate in accordance with applicable law. The parties agree that Texas
Finance Code, Chapter 346, which regulates certain revolving loan accounts and revolving triparty
accounts, shall not apply to any revolving loan accounts created under this Agreement or the Notes
or maintained in connection therewith.



     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 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



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invalidity of a provision in a particular jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.



     10.13 Impacted Lenders. (a) 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 is an
Impacted Lender, then (y) the Borrower may, upon notice to such Lender and the Administrative
Agent, and (z) in the case of an Impacted Lender, the Administrative Agent may, upon notice to such
Lender and the Borrower, 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:




          (i) other than an assignment required by the Administrative Agent, the Borrower
shall have paid to the Administrative Agent the assignment fee specified in Section
10.06(b);




          (ii) 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);




          (iii) 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




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



     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 or the
Administrative Agent to require such assignment and delegation cease to apply. In the event that
the Administrative Agent, the Borrower, the other Lenders, the L/C Issuers, and the Swing Line
Lenders each agree that an Impacted Lender has adequately remedied all matters that caused such
Lender to be an Impacted Lender and the Impacted Lender has not been removed or replaced, then such
Lender shall purchase at par such of the Loans and L/C Advances of the other Lenders (other than
Swing Line Loans, unless and until presented to such Lender for refinancing pursuant to Section
2.15(c)) as the Administrative shall determine may be necessary in order for such Lender to
hold such Loans and L/C Advances in accordance with its Commitment hereunder.



     (b) If a Lender is an Impacted Lender and upon the prior written consent of the Administrative
Agent, the other Lenders, the Swing Line Lender, and the L/C Issuers (in each case which consent
shall not be unreasonably withheld, conditioned or delayed), then the



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Borrower shall have the right to remove such Impacted Lender as a party to this Agreement, and
the Borrower may, upon notice to such Impacted Lender and the Administrative Agent remove such
Impacted Lender by terminating such Impacted Lender’s Commitment. The Borrower shall (i) pay in
full all principal, interest, fees and other amounts owing to such Impacted Lender through the date
of termination (including its participations in Letters of Credit and Swing Line Loans), (ii)
provide appropriate assurances and indemnities (which may include cash collateral) to the
applicable L/C Issuers and Swing Line Lender as either may reasonably require with respect to any
continuing obligation of such Impacted Lender to purchase participation interests in any Letters of
Credit then outstanding, and (iii) release such Impacted Lender from its obligations under the Loan
Documents. The Administrative Agent shall distribute an amended Schedule 2.01, which shall be
deemed incorporated into this Agreement, to reflect the removal of the Impacted Lender and
termination of its respective Commitment. The removal of an Impacted Lender and the termination of
such Lender’s Commitment shall not increase or decrease any other Lender’s Commitment which shall
continue in effect notwithstanding such removal of the Impacted Lender.



     (c) Notwithstanding any provision of this Agreement to the contrary, if any Lender becomes an
Impacted Lender, then the following provisions shall apply for so long as such Lender is an
Impacted Lender:




          (i) commitment fees shall cease to accrue on the unfunded portion of the Commitment
of such Impacted Lender pursuant to Section 2.09;




          (ii) the Commitment of such Impacted Lender shall not be included in determining
whether all Lenders or the Required Lenders have taken or may take any action hereunder
(including any consent to any amendment or waiver pursuant to Section 10.01
hereof), provided that any waiver, amendment or modification requiring the consent of all
Lenders or each affected Lender which affects such Impacted Lender shall require the
consent of such Impacted Lender; and;




          (iii) if the Borrower cash collateralizes any portion of such Impacted Lender’s L/C
Obligations pursuant to Section 2.03(g), the Borrower shall not be required to
pay any fees to such Impacted Lender pursuant to Section 2.09 with respect to
such Impacted Lender’s L/C Obligations during the period such Impacted Lender’s L/C
Obligations are cash collateralized.



     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 TEXAS; PROVIDED THAT THE ADMINISTRATIVE AGENT AND EACH LENDER SHALL
RETAIN ALL RIGHTS ARISING UNDER APPLICABLE FEDERAL LAW.




          (b) SUBMISSION TO JURISDICTION. 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 TEXAS SITTING IN HARRIS COUNTY AND OF THE




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UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF TEXAS, 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 TEXAS 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 MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN
ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL
AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER OR ANY L/C ISSUER MAY OTHERWISE HAVE TO
BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE
BORROWER OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.




          (c) WAIVER OF VENUE. THE BORROWER 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 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



-85-









 







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 ENTIRE AGREEMENT. THIS WRITTEN 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.



     10.18 Termination of Commitments under Existing Credit Agreement. The Existing Credit
Agreement, guaranties and all other agreements, documents and instruments executed in connection
therewith except the Existing Letters of Credit shall terminate on the Closing Date. Execution of
this Agreement by Lenders who are parties to the Existing Credit Agreement shall constitute a
waiver of the notice provisions in Sections 2.06 of the Existing Credit Agreement.




-86-












 





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



	 	 	 	 	 
	 	PATTERSON-UTI ENERGY, INC.,

a Delaware corporation, as Borrower

 	 
	 	By:  	/s/
Douglas J. Wall 	 
	 	 	Name:  	Douglas J. Wall 	 
	 	 	Title:  	President and Chief Executive Officer 	 
	 



Signature Page to Credit Agreement

(Patterson — UTI Energy, Inc.)




 









 





	 	 	 	 	 
	 	WELLS FARGO BANK, N.A.,

as Administrative Agent, an L/C Issuer

and a Lender

 	 
	 	By:  	 /s/ Michael W. Nygren 	 
	 	 	Name:   	Michael W. Nygren 	 
	 	 	Title: 	Vice President 	 
	 



Signature Page to Credit Agreement

(Patterson — UTI Energy, Inc.)




 









 





	 	 	 	 	 
	 	BANK OF AMERICA, N.A.,

as a Lender and as an L/C Issuer

 	 
	 	By:  	/s/
Gabe Gomez	 
	 	 	Name:  	Gabe Gomez 	 
	 	 	Title:  	Vice President 	 
	 



Signature Page to Credit Agreement

(Patterson — UTI Energy, Inc.)




 









 





	 	 	 	 	 
	 	THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.,

as a Lender

 	 
	 	By: 	/s/ Laurence J. Bressler	 
	 	 	Name: 	Laurence J. Bressler	 
	 	 	Title: 	Authorized Signatory	 
	 



Signature Page to Credit Agreement

(Patterson — UTI Energy, Inc.)




 









 





	 	 	 	 	 
	 	AMEGY BANK, NATIONAL ASSOCIATION,

as a Lender

 	 
	 	By:  	/s/
Scott Collins
	 
	 	 	Name:  	Scott Collins	 
	 	 	Title:  	Vice President	 
	 



Signature Page to Credit Agreement

(Patterson — UTI Energy, Inc.)




 









 





	 	 	 	 	 
	 	COMERICA BANK,

as a Lender

 	 
	 	By:  	/s/ Cyd Dillahunty 	 
	 	 	Name:  	Cyd Dillahunty	 
	 	 	Title:  	Vice President	 
	 



Signature Page to Credit Agreement

(Patterson — UTI Energy, Inc.)




 









 





	 	 	 	 	 
	 	HSBC BANK USA, N.A.,

as a Lender

 	 
	 	By:  	/s/ Anil Chandy	 
	 	 	Name:  	Anil Chandy	 
	 	 	Title:  	Assistant Vice President	 
	 
	 	By:  	/s/ Bruce Robinson	 
	 	 	Name:  	Bruce Robinson	 
	 	 	Title:  	Vice President	 
	 



Signature Page to Credit Agreement

(Patterson — UTI Energy, Inc.)





 









 








SCHEDULE 1.01




EXISTING LETTERS OF CREDIT




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	AMOUNT	 	 
	ISSUER	 	L/C #	 	ACCOUNT PARTY	 	BENEFICIARY	 	AVAILABLE	 	MATURITY
	Bank of America, N.A.
	 	3072456	 	Patterson-UTI Energy, Inc.	 	Liberty Mutual Insurance Company	 	 	45,712,000.00	 	 	 	11/7/2009	 
	Bank of America, N.A.
	 	3072477	 	Patterson-UTI Energy, Inc.	 	United States Fidelity and Guaranty Company	 	 	35,000.00	 	 	 	3/29/2009	 
	Bank of America, N.A.
	 	3072454	 	Patterson-UTI Energy, Inc.	 	Ace Fire Underwriters Insurance	 	 	989,000.00	 	 	 	9/3/2009	 
	Bank of America, N.A.
	 	3072455	 	Patterson-UTI Energy, Inc.	 	Zurich American  Insurance Company	 	 	450,000.00	 	 	 	10/1/2009	 
	Bank of America, N.A.
	 	3074338	 	Patterson-UTI Energy, Inc.	 	Liberty Mutual Insurance Company	 	 	7,034,000.00	 	 	 	4/5/2009	 
	Bank of America, N.A.
	 	3074584	 	Patterson-UTI Energy, Inc.	 	Zurich American Insurance Company	 	 	1,350,000.00	 	 	 	3/29/2009	 
	Bank of America, N.A.
	 	3072455	 	Patterson-UTI Energy, Inc.	 	National Union Fire Insurance Co.	 	 	2,600,000.00	 	 	 	12/20/2009	 
	Bank of America, N.A.
	 	3087210	 	Patterson-UTI Energy, Inc.	 	Highland Insurance  Company	 	 	285,000.00	 	 	 	3/30/2009	 
	TOTAL:
	 	 	 	 	 	 	 	 	58,455,000.00	 	 	 	 	 






Schedule 1.01





 









 








SCHEDULE 2.01




COMMITMENTS




AND APPLICABLE PERCENTAGES




	 	 	 	 	 	 	 	 	 
	Lender	 	Commitment	 	Applicable Percentage
	 
	Wells Fargo Bank, N.A.
	 	$	75,000,000	 	 	 	34.09091	%
	Bank of America, N.A.
	 	$	45,000,000	 	 	 	20.45455	%
	The Bank of Tokyo-Mitsubishi UFJ, Ltd.
	 	$	30,000,000	 	 	 	13.63636	%
	Amegy Bank, National Association
	 	$	25,000,000	 	 	 	11.36364	%
	Comerica Bank
	 	$	25,000,000	 	 	 	11.36364	%
	HSBC Bank USA, N.A.
	 	$	20,000,000	 	 	 	9.09091	%
	Total
	 	$	220,000,000	 	 	 	100.00000	%






Schedule 2.01





 












 





SCHEDULE 5.13




SUBSIDIARIES AND OTHER EQUITY INVESTMENTS




Part (a). Domestic Subsidiaries




	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	State of
	 	 	Percent Owned	 	Incorporation
	Name	 	by Borrower	 	or Organization
	 
	 	 	 	 	 	 	 	 
	Ambar Lone Star Fluids Services LLC
	 	 	100	%	 	Texas
	Patterson (GP) LLC
	 	 	100	%	 	Delaware
	Patterson Petroleum LLC
	 	 	100	%	 	Texas
	Patterson-UTI Drilling Co. Canada
	 	 	100	%	 	Nova Scotia
	Patterson-UTI Drilling Company LLC
	 	 	100	%	 	Texas
	Patterson-UTI Management Services, LLC
	 	 	100	%	 	Delaware
	Universal Well Services, Inc.
	 	 	100	%	 	Delaware
	UTI Drilling Canada, Inc.
	 	 	100	%	 	Delaware
	UTICO LLC
	 	 	100	%	 	Delaware






Part (b) Equity Investments in Other Entities




	 	 	 	 	 	 	 	 	 
	 	 	Number of 	 	 
	Entity	 	Interests Held	 	Description of Interests
	Arrow Construction, Inc.
	 	 	5	 	 	Shares of Common Stock
	EB2B Comm Inc.
	 	 	1,500	 	 	Shares of Preferred Convertible Series B
	ECOMM Security Inc.
	 	 	50,000	 	 	Shares of Preferred Series A
	EPL Acquisition Corp.
	 	 	28,820	 	 	Shares of Common Stock
	Essential Security Software, Inc.
	 	 	100,000	 	 	Shares of Common Stock
	Futurelink Corp.
	 	 	2,272	 	 	Shares of Common Stock
	Giant Studios Inc.
	 	 	6,667	 	 	Shares of Preferred Convertible Series A
	GOIP Global, Inc.
	 	 	87	 	 	Shares of Common Stock
	Linux Global Partners
	 	 	67,000	 	 	Shares of Preferred Convertible Series A
	Loral Space & Communications LTD
	 	 	2,400	 	 	Shares of Preferred Convertible Series C
	Miscor Group Ltd.
	 	 	29,000	 	 	Shares of Common Stock
	NYPPE Holdings LLC
	 	 	72,000	 	 	Shares of Preferred Class A
	ProxyMed, Inc.
	 	 	116.6	 	 	Shares of Common Stock
	RAK Partners II Qualified
Purchaser Fund, L.P.
	 	 	N/A	 	 	$100,000 limited partnership interest
	Scorpion Capital Partners, L.P.
	 	 	N/A	 	 	$250,000 limited partnership interest
	Streamcenter Inc.
	 	 	10,000	 	 	Shares of Series B Redeemable Convertible Preferred
	Walker Financial Corp.
	 	 	6,774,800	 	 	Shares of Common Stock






Schedule 7.01









 






SCHEDULE 7.01




CERTAIN EXISTING LIENS




	 	 	 	 	 	 	 	 	 	 	 
	Filing Number	 	Date Filed	 	Debtor(s)	 	Secured Party	 	Type of Filing	 	Description of Collateral
	07-0025091296

	 	7/25/2007
	 	Patterson-UTI
Energy, Inc. and
Patterson-UTI
Drilling Company
LLC (as assumed
name)
	 	Lubbock National

Bank

Lubbock, TX
	 	Financing Statement
	 	WorkCentre copier leased
by DivLend Equipment
Leasing L.L.C.
	 
	 	 	 	 	 	 	 	 	 	 
	83270631

	 	7/2/2008
	 	Universal Well
Services, Inc.
	 	Cisco Systems

Capital Corporation

Wayne, PA
	 	Financing Statement
	 	Various Cisco IT, server
and internet components
	 
	 	 	 	 	 	 	 	 	 	 
	82887543

	 	8/25/2008
	 	Patterson-UTI
Energy, Inc.
	 	Xerox Corporation

Lewisville, TX
	 	Financing Statement
	 	Five Xerox copiers
	 
	 	 	 	 	 	 	 	 	 	 
	09-0004042564

	 	2/10/2009
	 	Patterson-UTI

Drilling Company

LLC
	 	Holt Cat

San Antonio, TX
	 	Financing Statement
	 	One Caterpillar Model

3512 engine complete

with all substitutions,

replacements, additions,

attachments and/or

accessories thereto
	 
	 	 	 	 	 	 	 	 	 	 
	09-0004044617

	 	2/10/2009
	 	Patterson-UTI

Drilling Company

LLC
	 	Holt Cat

San Antonio, TX
	 	Financing Statement
	 	One Caterpillar Model

3512 engine complete

with all substitutions,

replacements, additions,

attachments and/or

accessories thereto
	 
	 	 	 	 	 	 	 	 	 	 
	09-0004045527

	 	2/10/2009
	 	Patterson-UTI

Drilling Company

LLC
	 	Holt Cat

San Antonio, TX
	 	Financing Statement
	 	One Caterpillar Model

3512 engine complete

with all substitutions,

replacements, additions,

attachments and/or

accessories thereto






Schedule 7.01









 






SCHEDULE 10.02




ADDRESSES FOR NOTICES TO COMPANY, GUARANTORS

AND ADMINISTRATIVE AGENT




BORROWER



Patterson-UTI Energy, Inc.

450 Gears Road, Suite 500

Houston, Texas 77067

Attention: Chief Financial Officer

Telephone: (281) 765-7100

Facsimile: (281) 765-7175




GUARANTORS



Ambar Lone Star Fluids Services LLC

c/o Patterson-UTI Energy, Inc.

450 Gears Road, Suite 500

Houston, Texas 77067

Attention: Chief Financial Officer

Telephone: (281) 765-7100

Facsimile: (281) 765-7175



Patterson (GP) LLC

c/o Patterson-UTI Energy, Inc.

450 Gears Road, Suite 500

Houston, Texas 77067

Attention: Chief Financial Officer

Telephone: (281) 765-7100

Facsimile: (281) 765-7175



Patterson Petroleum LLC

c/o Patterson-UTI Energy, Inc.

450 Gears Road, Suite 500

Houston, Texas 77067

Attention: Chief Financial Officer

Telephone: (281) 765-7100

Facsimile: (281) 765-7175



Patterson-UTI Drilling Company LLC

c/o Patterson-UTI Energy, Inc.

450 Gears Road, Suite 500

Houston, Texas 77067

Attention: Chief Financial Officer

Telephone: (281) 765-7100

Facsimile: (281) 765-7175




Schedule 10.02









 







Patterson-UTI Management Services, LLC

c/o Patterson-UTI Energy, Inc.

450 Gears Road, Suite 500

Houston, Texas 77067

Attention: Chief Financial Officer

Telephone: (281) 765-7100

Facsimile: (281) 765-7175



Universal Well Services, Inc.

c/o Patterson-UTI Energy, Inc.

450 Gears Road, Suite 500

Houston, Texas 77067

Attention: Chief Financial Officer

Telephone: (281) 765-7100

Facsimile: (281) 765-7175



UTI Drilling Canada, Inc.

c/o Patterson-UTI Energy, Inc.

450 Gears Road, Suite 500

Houston, Texas 77067

Attention: Chief Financial Officer

Telephone: (281) 765-7100

Facsimile: (281) 765-7175



UTICO LLC

c/o Patterson-UTI Energy, Inc.

450 Gears Road, Suite 500

Houston, Texas 77067

Attention: Chief Financial Officer

Telephone: (281) 765-7100

Facsimile: (281) 765-7175




WELLS FARGO BANK, N.A., as Administrative Agent



Address for Notices:



Wells Fargo Bank, N.A.

1740 Broadway, MAC C7300-034

Denver, CO 80209

Attention: Agency Syndication

Telephone: (303) 863-5378

Facsimile: (303) 863-5533

Email:




Schedule 10.02









 







With a copy to:



Wells Fargo Bank, N.A.

1000 Louisiana, 9th Floor

MAC T5002-090

Houston, Texas 77002

Attention: Brad Ellis, Vice President

Telephone: (713) 319-1985

Facsimile: (713) 739-1087

Email:



Administrative Agent’s Payment office:



Wells Fargo Bank, N.A.

ABA No.: [_]

Acct. No.: [_]

Ref: Patterson-UTI Energy, Inc.



Wells Fargo Bank, N.A.

1740 Broadway, MAC C7300-034

Denver, CO 80209

Attention: Agency Syndication

Telephone: (303) 863-5378

Facsimile: (303) 863-5533

Email:




WELLS FARGO BANK, N.A., as an L/C Issuer



Address for Notices:



1740 Broadway, MAC C7300-034

Denver, CO 80209

Attention: Agency Syndication

Telephone: (303) 863-5378

Facsimile: (303) 863-5533




Schedule 10.02









 







With a copy to:



Wells Fargo Bank, N.A.

1000 Louisiana, 9th Floor

MAC T5002-090

Houston, Texas 77002

Attention: Brad Ellis, Vice President

Telephone: (713) 319-1985

Facsimile: (713) 739-1087

Email:




BANK OF AMERICA, N.A., as an L/C Issuer



Address for Notices:



333 S. Beaudry Avenue

19th Floor — CA9-703-19-23

Los Angeles, CA 90017

Standby Letter of Credit Department

Attention: Stella Rosales

Telephone: (213) 345-0141

Facsimile: (213) 345-6684



With a copy to:



Bank of America, N.A.

700 Louisiana

8th Floor — TX4-213-08-14

Attention: Pam Rodgers

Houston, Texas 77002

Telephone: (713) 247-7246

Facsimile: (713) 247-7286

Email: pamela.rodgers@bankofamerica.com





Schedule 10.02











 





EXHIBIT A




FORM OF LOAN NOTICE




Date:                     ,           




To: Wells Fargo Bank, N.A., as Administrative Agent



Ladies and Gentlemen:




     Reference is made to that certain Credit Agreement, dated as of March 20, 2009 (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
Patterson-UTI Energy, Inc., a Delaware corporation (the “Borrower”), the Lenders from time
to time party thereto, and Wells Fargo Bank, N.A., as Administrative Agent and an L/C Issuer.



     The undersigned hereby requests (select one):



     o a Borrowing o a conversion of Loans o a continuation of Eurodollar Rate 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 proviso to the first sentence of
Section 2.01 of the Agreement.



	 	 	 	 	 	 	 
	 	 	PATTERSON-UTI ENERGY, INC.,

a Delaware corporation, as Borrower	 	 
	 
	 	 	 	 	 	 
	 

	 	By: 	 	 	 	 
	 

	 	 	 	 	 
	 

	 	 	Name: 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	Title: 	 	 	 
	 

	 	 	 	 	 	 





Exhibit A





 









 








EXHIBIT B




FORM OF NOTE




                    , 2009




     FOR VALUE RECEIVED, the undersigned (the “Borrower”) hereby promises to pay to
                                         or permitted and 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 March 20, 2009 (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 from time to time party thereto, and Wells Fargo Bank,
N.A., as Administrative Agent and an 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. 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 and by the Administrative Agent in the ordinary course
of business. The Lender may also attach schedules to this Note and endorse thereon the date, Type,
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, notice of intent to accelerate, notice of acceleration,
demand, dishonor and non-payment of this Note.



     The terms of Section 10.09 of the Credit Agreement are incorporated herein as fully as
if set forth herein.



Exhibit B




 









 








     THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
TEXAS; PROVIDED THAT EACH OF THE ADMINISTRATIVE AGENT AND THE LENDER SHALL RETAIN ALL RIGHTS
ARISING UNDER APPLICABLE FEDERAL LAW.



     THIS NOTE 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.



	 	 	 	 	 	 	 
	 	 	PATTERSON-UTI ENERGY, INC.,

a Delaware corporation, as Borrower	 	 
	 
	 	 	 	 	 	 
	 

	 	By: 	 	 	 	 
	 

	 	 	 	 	 
	 

	 	 	Name: 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	Title: 	 	 	 
	 

	 	 	 	 	 	 





Exhibit B




 









 








Loans and Payments with respect thereto




	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Amount of	 	Outstanding	 	 
	 	 	 	 	 	 	End of	 	Principal or	 	Principal	 	 
	 	 	Type of Loan	 	Amount of	 	Interest	 	Interest Paid	 	Balance This	 	Notation
	Date	 	Made	 	Loan Made	 	Period	 	This Date	 	Date	 	Made By
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 





Exhibit B




 









 








EXHIBIT C




FORM OF COMPLIANCE CERTIFICATE




Financial Statement Date:                                         




To: Wells Fargo Bank, N.A., as Administrative Agent



Ladies and Gentlemen:




     Reference is made to that certain Credit Agreement dated as of March 20, 2009 (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
Patterson-UTI Energy, Inc., a Delaware corporation (the “Borrower”), the Lenders from time
to time party thereto, and Wells Fargo Bank, N.A., as Administrative Agent and an 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 are] or [The Borrower has submitted or is submitting on this date pursuant
to Section 6.01(a) of the Agreement the following:] 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 and the report and opinion of an independent certified public accountant required by
such section.



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




     1. [Attached hereto are] or [The Borrower has submitted or is submitting on this date pursuant
to Section 6.01(b) of the Agreement the following:] 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 the financial condition, results of operations,
shareholders’ equity and cash flows of the Borrower and its Subsidiaries in accordance with GAAP as
at such date and for such period, subject only to normal year-end audit adjustments and the absence
of footnotes.



     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.



Exhibit C




 









 








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



[select one:]



[to the best knowledge of the undersigned during such fiscal period, the Borrower performed and
observed each covenant and condition of the Loan Documents applicable to it.]




—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:]




     4. The representations and warranties of the Borrower contained in Article V of the Agreement,
and any representations and warranties of any Loan Party that are contained in any document
furnished at any time under or in connection with the Loan Documents, are true and correct on and
as of the date hereof, except to the extent that such representations and warranties specifically
refer to an earlier date, in which case they are true and correct as of such earlier date, and
except that for purposes of this Compliance Certificate, the representations and warranties
contained in 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, [except as follows:                                         ].



     5. The financial covenant analyses and information set forth on Schedule 1 attached hereto are
true and accurate on and as of the date of this Certificate.



     6. Each Domestic Subsidiary (excluding Immaterial Subsidiaries) existing as of the date of
this Certificate has executed and delivered to the Administrative Agent a Guaranty (or such other
document as the Administrative Agent has requested to cause such Domestic Subsidiary to become a
Guarantor), and such other documents as are required by Section 6.12 of the Agreement.



Exhibit C




 









 








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



	 	 	 	 	 	 	 
	 	 	PATTERSON-UTI ENERGY, INC.,

a Delaware corporation, as Borrower	 	 
	 
	 	 	 	 	 	 
	 

	 	By: 	 	 	 	 
	 

	 	 	 	 	 
	 

	 	 	Name: 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	Title: 	 	 	 
	 

	 	 	 	 	 	 





Exhibit C





 









 








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




SCHEDULE 1

to the Compliance Certificate

($ in 000’s)




	 	 	 	 	 
	I.
Section 7.10(a) — Debt to Capitalization Ratio.
	 	 	 	 
	 
	 	 	 	 
	A. Consolidated Funded Indebtedness:
	 	 	 	 
	 
	 	 	 	 
	1. Obligations for borrowed money:
	 	$	      	 
	 
	 	 	 	 
	 
	 	 	 	 
	2. Reimbursement obligations arising under letters of credit,
bankers’ acceptances, bank guaranties, surety bonds, and similar
instruments:
	 	$	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	3. Obligations to pay deferred purchase price of property or
services (other than trade accounts payable to a Person (i) in the
United States or Canada, if not past due for more than 60 days or
(ii) in any other country, if not past due for more than 120 days):
	 	$	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	4. Indebtedness secured by a Lien on property owned or being
purchased by the Borrower or its Subsidiaries:
	 	$	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	5. Capital leases:
	 	$	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	6. Obligations in respect of any forward sale of production for which
payment is received in advance, other than on ordinary trade terms:
	 	$	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	7. Obligations to purchase, redeem, or otherwise make any payment in
respect of any Equity Interest, on a date certain and not subject to
any contingencies, or at the option of the holder of such Equity
Interest:
	 	$	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	8. Guaranty obligations in respect of the foregoing:
	 	$	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	9. Consolidated Funded Indebtedness (the sum of I.A.1 through I.A.8):
	 	$	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	B. Total Capital
	 	 	 	 
	 
	 	 	 	 
	1. Consolidated Funded Indebtedness (I.A.9):
	 	$	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	2. Consolidated Net Worth:
	 	$	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	3. Total Capital (I.B.1 + I.B.2):
	 	$	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	C. Debt to Capitalization Ratio ((I.A.9 ÷ I.B.3) x 100):
	 	 		%
	 
	 	 	 	 
	 
	 	 	 	 
	Maximum allowed:
	 	 	35	%





Schedule 1 to Exhibit C



 









 






	 	 	 	 	 
	II. Section 7.10(b) — Interest Coverage Ratio.
	 	 	 	 
	 
	 	 	 	 
	A. Consolidated EBITDA for four consecutive fiscal quarters ending on
above date (“Subject Period”):
	 	 	 	 
	 
	 	 	 	 
	1. Consolidated Net Income for Subject Period:
	$	 	 	 
	 
	 	 	 
	 
	 	 	 	 
	2. Consolidated Interest Charges for Subject Period:
	$	 	 	 
	 
	 	 	 
	 
	 	 	 	 
	3. Income taxes for Subject Period (including state franchise taxes
based on income or similar taxes based on income):
	$	 	 	 
	 
	 	 	 
	 
	 	 	 	 
	4. Depreciation expenses for Subject Period:
	$	 	 	 
	 
	 	 	 
	 
	 	 	 	 
	5. Depletion expenses for Subject Period:
	$	 	 	 
	 
	 	 	 
	 
	 	 	 	 
	6. Amortization expenses for Subject Period:
	$	 	 	 
	 
	 	 	 
	 
	 	 	 	 
	7. Non-cash reductions of Consolidated Net Income for Subject Period:
	$	 	 	 
	 
	 	 	 
	 
	 	 	 	 
	8. Non-cash additions to Consolidated Net Income for Subject Period:
	$	 	 	 
	 
	 	 	 
	 
	 	 	 	 
	9. Consolidated EBITDA (II.A.1 + II.A.2 + II.A.3 + II.A.4 + II.A.5 +
II.A.6 + II.A.7 — II.A.8):
	$	 	 	 
	 
	 	 	 
	 
	 	 	 	 
	B. Consolidated Interest Charges for Subject Period:
	 	 	 	 
	 
	 	 	 	 
	1. Interest, premium payments, debt discount, fees, charges and
related expenses in connection with borrowed money or in connection
with the deferred purchase price of assets:
	$	 	 	 
	 
	 	 	 
	 
	 	 	 	 
	2. Rent expenses under capital leases treated as interest in
accordance with GAAP:
	$	 	 	 
	 
	 	 	 
	 
	 	 	 	 
	3. Consolidated Interest Charges (II.B.1 + II.B.2):
	$	 	 	 
	 
	 	 	 
	 
	 	 	 	 
	C. Interest Coverage Ratio (II.A.9 ÷ II.B.3):
	 	___ to 1
	 
	Minimum required:
	 	 	3.00 to 1	 






Schedule 1 to Exhibit C





 











 





EXHIBIT D




FORM OF 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(s): Patterson-UTI Energy, Inc., a Delaware corporation
	 
	 	 
	4.

	 	Administrative Agent: Wells Fargo Bank, N.A., as the administrative agent under the Credit
Agreement
	 
	 	 
	5.

	 	Credit Agreement: Credit Agreement dated as of March 20, 2009, among Patterson-UTI Energy,
Inc., the Lenders from time to time party thereto, and Wells Fargo Bank, N.A., as
Administrative Agent and an L/C Issuer
	 
	 	 
	6.

	 	Assigned Interest:






Exhibit D




 









 








	 	 	 	 	 	 	 
	Aggregate	 	 	 	 	 	 
	Amount of	 	Amount of	 	Percentage	 	 
	Commitment	 	Commitment	 	Assigned of	 	 
	for all Lenders	 	Assigned1	 	Commitment2	 	CUSIP Number
	$                                        

	 	$                                        
	 	                                        %	 	 






[7.     Trade Date:                                         ]3




     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:



	 	 	 	 	 
	 	ASSIGNOR

[NAME OF ASSIGNOR]

 	 
	 	By:  	
 	 
	 	 	Title: 	 
	 	 	 	 
	 
	 	ASSIGNEE

[NAME OF ASSIGNEE]

 	 
	 	By:  	
 	 
	 	 	Title: 	 
	 



[Consented to and]4 Accepted:




	 	 	 	 	 
	 	WELLS FARGO BANK, N.A., as

Administrative Agent and as an L/C Issuer

 	 
	 	By:  	
 	 	 
	 	 	Title: 	 
	 	 	 	 
	 





 




			
	1	 	Amount to be adjusted by the counterparties to take
into account any payments or prepayments made between the Trade Date and the
Effective Date.
	 
	2	 	To be completed if the Assignor and the Assignee intend
that the minimum assignment amount is to be determined as of the Trade Date.
	 
	3	 	To be added only if the consent of the Administrative
Agent and L/C Issuer is required by the terms of the Credit Agreement.
	 
	4	 	To be added only if the consent of the Administrative
Agent and L/C Issuer is required by the terms of the Credit Agreement.





Exhibit D




 









 








[Consented to:]5




	 	 	 	 	 
	 	BANK OF AMERICA, N.A.,

as an L/C Issuer

 	 
	 	By:  	
 	 	 
	 	 	Title: 	 
	 



[Consented to:]6




	 	 	 	 	 
	 	PATTERSON-UTI ENERGY, INC., as

Borrower

 	 
	 	By:  	
 	 	 
	 	 	Title: 	 





 




			
	5	 	To be added only if the consent of the Borrower is
required by the terms of the Credit Agreement.
	 
	6	 	To be added only if the consent of the Borrower is
required by the terms of the Credit Agreement.





Exhibit D




 









 








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 6.01 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




Annex 1 to Assignment and Assumption




 









 







Effective Date and to the Assignee for amounts which have accrued from and after the Effective
Date.




          3. General Provisions. This Assignment and Assumption shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and assigns. This
Assignment and Assumption may be executed in any number of counterparts, which together shall
constitute one instrument. Delivery of an executed counterpart of a signature page of this
Assignment and Assumption by telecopy 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 Texas.




Annex 1 to Assignment and Assumption




 









 








EXHIBIT E




FORM OF CONTINUING GUARANTY




     FOR VALUE RECEIVED, the sufficiency of which is hereby acknowledged, and in consideration of
any credit and/or financial accommodation heretofore or hereafter from time to time made or granted
to Patterson-UTI Energy, Inc. (“Borrower”) or any other Loan Party under that certain
Credit Agreement dated as of March 20, 2009, by and between Borrower, the financial institutions
party thereto (collectively, the “Lenders”), and Wells Fargo Bank, N.A., as Administrative
Agent (in such capacity, the “Administrative Agent”) and as an L/C Issuer (the “Credit
Agreement”), each of the Persons now or hereafter signatories hereto (each a
“Guarantor,” and, collectively, the “Guarantors”) hereby furnishes in favor of
Administrative Agent and the Lenders (each a “Guaranteed Party” and collectively, the
“Guaranteed Parties”) its joint and several guaranty of the Guaranteed Obligations (as
hereinafter defined) as follows:



     1. Reference to Credit Agreement. Each Guarantor covenants and agrees that certain
representations, warranties and covenants set forth in the Credit Agreement are applicable to
Guarantors, and it (i) reaffirms that each such representation and warranty is true and correct in
every material respect with respect to such Guarantor to the extent that such representation and
warranty refers to such Guarantor, and (ii) agrees to comply with all of the covenants related to
it, contained in the Credit Agreement. Each Guarantor agrees that if the Credit Agreement shall
cease to remain in effect for any reason whatsoever during any period and any part of the
Guaranteed Obligations (as hereinafter defined) remain unpaid, then the terms, covenants, and
agreements thereof which are applicable to it shall nevertheless continue in full force and effect
as obligations of such Guarantor under this Guaranty. Each Guarantor shall take, or refrain from
taking, as the case may be, each action that is necessary to be taken or not taken, as the case may
be, so that no Event of Default is caused by the failure to take or refrain from taking such
action, as the case may be. All capitalized terms used but not defined herein shall have the
meaning assigned to such term in the Credit Agreement.



     2. Guaranty. (a) Each Guarantor hereby, jointly and severally, absolutely and unconditionally
guarantees, as a guarantee of payment and not as a guarantee of collection, the prompt payment in
full in Dollars when due, whether at stated maturity, upon acceleration or otherwise, and at all
times thereafter, of




          (i) any and all existing and future indebtedness and liabilities of every kind, nature
and character, direct or indirect, absolute or contingent, liquidated or unliquidated,
voluntary or involuntary, of any Loan Party arising under any Loan Document or otherwise
with respect to any Loan or Letter of Credit, and




          (ii) all existing and future indebtedness and liabilities of the Borrower or any
Subsidiary of the Borrower pursuant to any Lender Interest Rate Swap Contract arising while
such Lender or its Affiliate is a Lender party to the Credit Agreement,


in each case including interest and fees that accrue after the commencement by or against any Loan
Party or any Affiliate thereof of any proceeding under any Debtor Relief Laws naming such Person as
the debtor in such proceeding, regardless of whether such interest and fees are




Exhibit E




 









 







allowed claims in such proceeding (collectively, the “Guaranteed Obligations”). As used
herein, “Lender Interest Rate Swap Contract” means a Swap Contract between the Borrower or
any Subsidiary of the Borrower and any Lender or Affiliate of a Lender entered into for purposes of
mitigating interest rate risk.




          (b) The books and records of the Guaranteed Parties showing the amount of the Guaranteed
Obligations shall be admissible in evidence in any action or proceeding, and shall be binding upon
each Guarantor and conclusive for the purpose of establishing the amount of the Guaranteed
Obligations, absent manifest error. This Guaranty shall not be affected by the genuineness,
validity, regularity or enforceability of the Guaranteed Obligations or any instrument or agreement
evidencing any Guaranteed Obligations, or by the existence, validity, enforceability, perfection,
or extent of any collateral therefor, or by any fact or circumstance relating to the Guaranteed
Obligations which might otherwise constitute a defense to the obligations of any Guarantor under
this Guaranty.




          (c) The obligations of each Guarantor hereunder shall be limited to an aggregate amount equal
to the largest amount that would not render its obligations hereunder subject to avoidance under
Section 548 of the Bankruptcy Code (Title 11, United States Code) or any comparable provisions of
any applicable state law.




     3. No Setoff or Deductions; Taxes. Each Guarantor represents and warrants that it is an
entity formed or incorporated, as the case may be, under the laws of one or more states of the
United States of America. All payments by the Guarantors hereunder shall be paid in full, without
setoff or counterclaim or any deduction or withholding whatsoever for any and all Indemnified Taxes
or Other Taxes. If any Guarantor must make a payment under this Guaranty, such Guarantor agrees
that it will make the payment from one of its U.S. resident offices to Administrative Agent, on
behalf of the Guaranteed Parties. If notwithstanding the foregoing, any Guarantor makes a payment
to a Guaranteed Party under this Guaranty to which Guarantor shall be required by applicable law to
deduct any Indemnified Taxes or Other Taxes from such payments, such Guarantor shall pay all such
taxes to the relevant authority in accordance with applicable law such that the applicable
Guaranteed Party receives the sum it would have received had no such deduction or withholding been
made and shall also pay to such Guaranteed Party, within 30 days after demand therefor, all
additional amounts which such Guaranteed Party specifies as necessary to preserve the after-tax
yield would have received if such taxes had not been imposed. Such Guarantor shall promptly
provide such Guaranteed Party with an original receipt or certified copy issued by the relevant
authority evidencing the payment of any such amount required to be deducted or withheld.



     4. No Termination. This Guaranty is a continuing and irrevocable guaranty of all Guaranteed
Obligations now or hereafter existing and shall remain in full force and effect until (i) all
Guaranteed Obligations and any other amounts payable under this Guaranty are indefeasibly paid and
performed in full, the Commitments of the Lenders under the Credit Agreement are terminated, and
all Letters of Credit have expired or been terminated and can no longer be drawn, or (ii) with
respect to a Guarantor, such Guarantor is released from its obligations under this Guaranty by an
instrument in writing signed by the Administrative Agent pursuant to the Credit Agreement (such
Guarantor referenced in this clause (ii) is herein referred to as a “Released Guarantor”.



Exhibit E





 









 








     5. Waiver of Notices. Each Guarantor waives notice of the acceptance of this Guaranty and of
the extension or continuation of the Guaranteed Obligations or any part thereof. Each Guarantor
further waives presentment, protest, notice, dishonor or default, demand for payment and any other
notices to which such Guarantor might otherwise be entitled.



     6. Subrogation. No Guarantor shall exercise any right of subrogation, contribution or similar
rights with respect to any payments it makes under this Guaranty until all of the Guaranteed
Obligations and any amounts payable under this Guaranty are indefeasibly paid and performed in full
and the commitments of the Lenders under the Credit Agreement are terminated. If any amounts are
paid to any Guarantor in violation of the foregoing limitation, then such amounts shall be held in
trust for the benefit of the Guaranteed Parties and shall forthwith be paid to Administrative
Agent, on behalf of the Guaranteed Parties, to reduce the amount of the Guaranteed Obligations,
whether matured or unmatured.



     7. Waiver of Suretyship Defenses. Each Guarantor agrees that the Guaranteed Parties may, at
any time and from time to time, and without notice to the Guarantors, make any agreement with
Borrower or with any other person or entity liable on any of the Guaranteed Obligations or
providing collateral as security for the Guaranteed Obligations, for the extension, renewal,
payment, compromise, discharge or release of the Guaranteed Obligations or any collateral (in whole
or in part), or for any modification or amendment of the terms thereof or of any instrument or
agreement evidencing the Guaranteed Obligations or the provision of collateral, all without in any
way impairing, releasing, discharging or otherwise affecting the obligations of the Guarantors
under this Guaranty. Each Guarantor waives any defense arising by reason of any disability or
other defense of Borrower or any other guarantor (including any other Guarantor hereunder), or the
cessation from any cause whatsoever of the liability of Borrower or any other Loan Party, or any
claim that such Guarantor’s obligations exceed or are more burdensome than those of Borrower or any
other Loan Party and waives the benefit of any statute of limitations affecting the liability of
such Guarantor hereunder. Each Guarantor waives any right to enforce any remedy which any
Guaranteed Party now has or may hereafter have against Borrower or any other Loan Party and waives
any benefit of and any right to participate in any security now or hereafter held by the Guaranteed
Parties. Further, each Guarantor consents to the taking of, or failure to take, any action which
might in any manner or to any extent vary the risks of such Guarantor under this Guaranty or which,
but for this provision, might operate as a discharge of such Guarantor.



     8. Exhaustion of Other Remedies Not Required. The obligations of the each Guarantor hereunder
are those of primary obligor, and not merely as surety, and are independent of the Guaranteed
Obligations. Each Guarantor waives diligence by the Guaranteed Parties and action on delinquency
in respect of the Guaranteed Obligations or any part thereof, including, without limitation any
provisions of law requiring the Guaranteed Parties to exhaust any right or remedy or to take any
action against Borrower, any other guarantor (including any other Guarantor hereunder), or any
other person, entity or property before enforcing this Guaranty against such Guarantor, including,
but not limited to, the benefits of Chapter 34 of the Texas Business and Commerce Code, §17.001 of
the Texas Civil Practice and Remedies Code, and Rule 31 of the Texas Rules of Civil Procedure, or
any similar statute.



Exhibit E




 









 








     9. Reinstatement. Notwithstanding anything in this Guaranty to the contrary, this Guaranty
shall continue to be effective or be reinstated, as the case may be, if at any time any payment of
any portion of the Guaranteed Obligations is revoked, terminated, rescinded or reduced or must
otherwise be restored or returned upon the insolvency, bankruptcy or reorganization of Borrower or
any other person or entity or otherwise, as if such payment had not been made and whether or not
the Guaranteed Parties have in possession of or have released this Guaranty and regardless of any
prior revocation, rescission, termination or reduction, in each case, however, other than a
Released Guarantor.



     10. Subordination. Each Guarantor hereby subordinates, to the extent herein provided and
except as otherwise set forth below in this Section 10, all obligations and indebtedness of any
Loan Party owing to such Guarantor, whether now existing or hereafter arising (the
“Subordinated Obligations”), to the indefeasible payment in full of all Guaranteed
Obligations. As long as no Event of Default has occurred and is continuing, this Guaranty shall
not limit any Guarantor’s right to receive payment from any Loan Party on account of any
Subordinated Obligations. Upon the occurrence and during the continuation of an Event of Default,
the Guarantor agrees not to accept any payment for any Subordinated Obligations. In the event of
(i) any insolvency, bankruptcy, receivership, liquidation, reorganization, readjustment,
composition or other similar proceeding relating to a Loan Party, its creditors as such or its
property, (ii) any proceeding for the liquidation, dissolution or other winding-up of a Loan Party,
voluntary or involuntary, whether or not involving insolvency or bankruptcy proceedings, (iii) any
assignment by a Loan Party for the benefit of creditors, or (iv) any other marshalling of the
assets of a Loan Party, the Guaranteed Obligations (including any interest thereon accruing at the
legal rate after the commencement of any such proceedings and any additional interest that would
have accrued thereon but for the commencement of such proceedings) shall first be paid in full
before any payment or distribution, whether in cash, securities or other property, shall be made by
or on behalf of or from the estate of such Loan Party to any holder of Subordinated Obligations.
If a Guarantor receives any payment of any Subordinated Obligations in violation of the terms of
this Section, such Guarantor shall hold that payment in trust for Administrative Agent and Lenders
and promptly turn it over to Administrative Agent, in the form received (with any necessary
endorsements), to be applied to the Guaranteed Obligations.



     11. Information. Each Guarantor agrees to furnish promptly to Administrative Agent such
information of the type described in Section 6.02(h) of the Credit Agreement.



     12. Stay of Acceleration. In the event that acceleration of the time for payment of any of
the Guaranteed Obligations is stayed, upon the insolvency, bankruptcy or reorganization of Borrower
or any other person or entity, or otherwise, all such amounts shall nonetheless be payable by the
Guarantors, jointly and severally, immediately upon demand by the Guaranteed Parties.



     13. Expenses. Each Guarantor shall pay, jointly and severally, on demand all out-of-pocket
expenses (including reasonable attorneys’ fees and expenses and the allocated cost and
disbursements of internal legal counsel) in any way relating to the enforcement or protection of
any Guaranteed Party’s rights under this Guaranty, including any incurred in the preservation,
protection or enforcement of any rights of any Guaranteed Party in any case commenced by or



Exhibit E




 









 







against any Guarantor under the Bankruptcy Code (Title 11, United States Code) or any similar or
successor statute. The obligations of each Guarantor under the preceding sentence shall survive
termination of this Guaranty.




     14. Application of Payments. Any payment received by any Guaranteed Party from any Guarantor
(or from any Lender pursuant to Paragraph 19 below), shall be remitted to and applied by
Administrative Agent in accordance with Section 8.03 of the Credit Agreement.



     15. Amendments. No amendment or waiver of any provision of this Guaranty, nor consent to any
departure by any Guarantor herefrom, shall in any event be effective unless the same shall be in
writing and signed, in the case of amendments, by the Guarantor(s) affected thereby and by
Administrative Agent, and, in the case of consents or waivers, by Administrative Agent, and then
such amendment, waiver or consent shall be effective only in the specific instance and for the
specific purpose for which made or given. Notwithstanding the foregoing, no Guarantor shall be
released from this Guaranty except by a writing signed by the Administrative Agent as permitted by
Section 9.10 or Section 10.01 of the Credit Agreement.



     16. No Waiver; Enforceability. No failure by the Guaranteed Parties to exercise, and no delay
in exercising, any right, remedy or power hereunder shall operate as a waiver thereof; nor shall
any single or partial exercise of any right, remedy or power hereunder preclude any other or
further exercise thereof or the exercise of any other right. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law or in equity. The unenforceability or
invalidity of any provision of this Guaranty shall not affect the enforceability or validity of any
other provision herein.



     17. Assignment; Governing Laws; Jurisdiction. This Guaranty shall (a) bind each Guarantor and
its successors and assigns, provided that such Guarantor may not assign its rights or obligations
under this Guaranty without the prior written consent of Administrative Agent and the Lenders (and
any attempted assignment without such consent shall be void), (b) inure to the benefit of the
Guaranteed Parties and their successors and permitted assigns and each Lender may, without notice
to the Guarantor and without affecting the Guarantor’s obligations hereunder, assign or sell
participations in the Guaranteed Obligations and this Guaranty, in whole or in part, and (c) be
governed by the internal laws of the State of Texas; provided that the Administrative Agent and
each Lender shall retain all rights arising under applicable federal law.



     Each Guarantor hereby irrevocably (i) submits to the non exclusive jurisdiction of any State
court sitting in Harris County, Texas, any United States District Court of the Southern District of
Texas, and any appellate court from any thereof, in any action or proceeding arising out of or
relating to this Guaranty, and (ii) waives to the fullest extent permitted by applicable law any
defense asserting an inconvenient forum in connection therewith. Service of process by the
Guaranteed Parties in connection with such action or proceeding shall be binding on each Guarantor
if sent to such Guarantor by registered or certified mail at its address specified below. Subject
to such Lender’s compliance with Section 10.07 of the Credit Agreement, each Guarantor agrees that
each Lender may disclose to any prospective purchaser and any purchaser of all or part of the
Guaranteed Obligations any and all information in such Lender’s possession concerning such
Guarantor, this Guaranty and any security for this Guaranty.



Exhibit E





 











 





     18. Condition of Borrower. Each Guarantor acknowledges and agrees that it has the sole
responsibility for, and has adequate means of, obtaining from Borrower such information concerning
the financial condition, business and operations of Borrower as such Guarantor requires, and that
the Guaranteed Parties have no duty, and such Guarantor is not relying on the Guaranteed Parties at
any time, to disclose to such Guarantor any information relating to the business, operations or
financial condition of Borrower.



     19. Setoff. Each Guarantor agrees to the provisions of Section 10.08 of the Credit Agreement.



     20. Further Assurances. Each Guarantor agrees that at any time and from time to time, at the
expense of such Guarantor, to promptly execute and deliver all further instruments and documents,
and take all further action, that may be necessary or desirable, or that Administrative Agent may
reasonably request, to enable Administrative Agent to protect and to exercise and enforce the
rights and remedies of the Guaranteed Parties hereunder.



     21. Addition of Guarantors. The initial Guarantors hereunder shall be each of the
Subsidiaries of Borrower that are signatories hereto and that are listed on Schedule 1 attached
hereto. From time to time subsequent to the time hereof, additional Subsidiaries of Borrower may
become parties hereto as additional Guarantors (each an “Additional Guarantor”) by
executing a counterpart of this Guaranty Agreement in the form of Exhibit A attached hereto and
delivery to the Administrative Agent of all items required pursuant to Section 6.12(b) of
the Credit Agreement. Upon delivery of any such counterpart to Administrative Agent, notice of
which is hereby waived by Guarantors, each such Additional Guarantor shall be a Guarantor and shall
be a party hereto as if such Additional Guarantor were an original signatory hereof. Each
Guarantor expressly agrees that its obligations arising hereunder shall not be affected or
diminished by the addition or release of any other Guarantor hereunder, or by any election by
Administrative Agent not to cause any Subsidiary of Borrower to become an Additional Guarantor
hereunder.



     22. Notices. All notices, requests and other communications provided for hereunder shall be
in writing and given to Administrative Agent or any Guarantor as provided in Section 10.02 of the
Credit Agreement.



     23. Joint and Several Obligations. Each Guarantor acknowledges that (i) this Guaranty is a
master Guaranty pursuant to which other Subsidiaries of Borrower now or hereafter may become
parties, and (ii) the guaranty obligations of each of the Guarantors hereunder are joint and
several.



     24. WAIVER OF JURY TRIAL; FINAL AGREEMENT. TO THE EXTENT ALLOWED BY APPLICABLE LAW, EACH
GUARANTOR AND EACH GUARANTEED PARTY WAIVES TRIAL BY JURY WITH RESPECT TO ANY ACTION, CLAIM, SUIT OR
PROCEEDING ON OR ARISING OUT OF THIS GUARANTY. THIS GUARANTY (INCLUDING ANY SUPPLEMENTAL GUARANTY
OR OTHER AGREEMENT BY WHICH A PERSON BECOMES A GUARANTOR), AND THE CREDIT AGREEMENT REPRESENT THE
FINAL AGREEMENT BETWEEN THE PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF AND MAY NOT BE
CONTRADICTED BY EVIDENCE



Exhibit E









 







OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES.



     THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.



Remainder of Page Intentionally Blank.

Signature(s) Page to Follow.




Exhibit E









 








     IN WITNESS WHEREOF, the Guarantors have caused this Guaranty to be duly executed and delivered
by their respective officers thereunto duly authorized as of March 20, 2009.



[NAMES OF THE GUARANTORS]





Exhibit E









 








SCHEDULE 1




INITIAL GUARANTORS




Universal Well Services, Inc.

UTI Drilling Canada, Inc.

Patterson (GP) LLC

Patterson-UTI Management Services, LLC

UTICO LLC

Ambar Lone Star Fluids Services LLC

Patterson Petroleum LLC

Patterson-UTI Drilling Company LLC





Schedule 1 to Exhibit E









 








EXHIBIT A




COUNTERPART TO CONTINUING GUARANTY




     In witness whereof, the undersigned Additional Guarantor has caused this Counterpart to
Continuing Guaranty to be duly executed and delivered by its duly authorized officer as of ____________
___, 20    .



	 	 	 	 	 
	 
	 	[NAME OF ADDITIONAL GUARANTOR]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



Exhibit A to Exhibit E









 






	 	 	 	 	 



EXHIBIT F




FORM OF OPINION OF COUNSEL




March 20, 2009




Each of the Lenders under the




  Credit Agreement, including those

  Lenders listed in Schedule A hereto




Wells Fargo Bank, N.A.,





  as Administrative Agent for the Lenders, L/C Issuer, Swing Line Lender, and Lender



[Address to come]




Ladies and Gentlemen:




     We have acted as counsel to Patterson-UTI Energy, Inc., a Delaware corporation (the
“Company”), in connection with its execution and delivery of (i) the Credit Agreement dated as of
March 20, 2009 (the “Credit Agreement”), among the Company, the lenders from time to time parties
thereto (the “Lenders”), and Wells Fargo Bank, N.A., as administrative agent (in such capacity, the
“Administrative Agent”), letter of credit issuer, swing line lender, and lender, and (ii) the
promissory notes each dated March 20, 2009 (the “Notes”), executed and delivered by the Company
pursuant to the Credit Agreement. In addition, we have acted as counsel to the Guarantors each in
connection with its execution and delivery of the Continuing Guaranty dated as of March 20, 2009
(the “Guaranty”). Capitalized terms used and not defined herein or in any Schedule hereto have the
meanings assigned to such terms in the Credit Agreement. The opinions expressed herein are being
furnished to you pursuant to Section 4.01(a)(v) of the Credit Agreement.



     In rendering the opinions expressed herein, we have (i) examined the Credit Agreement, the
Notes, and the Guaranty (collectively, the “Financing Documents”), corporate records of the Company
and each of the Guarantors (collectively, the “Loan Parties”), certificates of representatives of
the Loan Parties, certificates and other communications of public officials and such other
instruments, agreements and documents as are in our judgment necessary to enable us to render the
opinions expressed herein, and (ii) as to questions of fact material to the opinions expressed
herein, and as to factual matters arising in connection with our examination of the aforesaid
materials, relied, to the extent we deemed appropriate, upon the factual representations and
warranties contained in the Financing Documents, upon such certificates, communications,
instruments, agreements, and documents and certain facts stated elsewhere herein.



     In making such examination and in such reliance, we have assumed the authenticity and
completeness of all records, certificates, instruments, agreements, and other documents submitted
to us as originals, the conformity to authentic originals, records, certificates, instruments,
agreements, and other documents of all copies submitted to us as copies, and the authenticity of
the originals of such latter records, certificates, instruments, agreements, and other documents.
In



 









 







Wells Fargo Bank, N.A., as Administrative Agent

March 20, 2009






addition, we have assumed the legal capacity of each natural person identified in, or
indicated as having executed, any of those records, certificates, instruments, agreements, and
other documents and the genuineness of all signatures on all such records, certificates,
instruments, agreements, and other documents.



     In rendering the opinions expressed herein, we also have assumed the following:



          (i) each Person a party to any Financing Document other than a Loan Party (each such Person
other than the Loan Parties, an “Other Party”) (a) has been duly organized or formed (as
applicable), (b) is validly existing and in good standing under the laws of its jurisdiction of
incorporation or formation (as applicable), and (c) has the corporate or equivalent power and
authority to execute and deliver, and to perform its obligations under, each of the Financing
Documents in which such Person is identified as a party;




          (ii) the execution and delivery of each of the Financing Documents by each Other Party, and
the performance of its obligations thereunder, have been duly authorized by all necessary corporate
or equivalent action on the part of each such Other Party;




          (iii) each Other Party has duly executed and delivered each of the Financing Documents in
which such Other Party is identified as a party;




          (iv) each Person a party to any Financing Document other than a Loan Party has (a) satisfied
each legal requirement that is applicable to such Person to the extent necessary to make such
Financing Document enforceable against such Person, and (b) complied with any other legal
requirements pertaining to the status of such Person as such status relates to the rights of such
Person to perform or enforce (as applicable) such Financing Document against each other Person that
is identified as a party to such Financing Document;




          (v) no order, consent, approval, license, authorization, waiver, or validation of, or filing,
recording, or registration with, or notice to, or exemption by any court, governmental body, or
authority, or any subdivision thereof, is required to authorize or is required in connection with
the execution and delivery of any Financing Document by any Person identified in any such Financing
Document as a party thereto or in connection with the performance of any such Person’s obligations
thereunder or the consummation of the transactions contemplated thereby, other than those that have
been obtained or made and are in full force and effect (provided, that we make no such assumption
with respect to consents, approvals, and the like applicable to the Loan Parties to the extent that
we express our opinion rendered in paragraph 6 below);




          (vi) each of the Financing Documents is the valid and binding obligation of each Person
identified as a party thereto (other than a Loan Party), enforceable against each such Person in
accordance with its terms; and




          (vii) Administrative Agent has been and is the duly appointed agent of each of the Lenders and
L/C Issuers (the Administrative Agent, L/C Issuers, Lenders, and Swing Line Lenders collectively,
the “Financing Parties”).




 









 






Wells Fargo Bank, N.A., as Administrative Agent

March 20, 2009




     Based upon the foregoing and in the reliance thereon, and subject to and qualified by the
assumptions, qualifications, limitations, and exceptions set forth herein, and having due regard
for such legal considerations as we deem relevant, we are of the opinion that:



          1. a. The Company is validly existing as a corporation in good standing under the General
Corporation Law of the State of Delaware (the “DGCL”).




               b. Each of the Delaware Corporations is validly existing as a corporation in good standing
under the DGCL.



               c. Each of the Delaware LLCs is validly existing as a limited liability company in good
standing under the Delaware Limited Liability Company Act (the “Delaware LLC Act”).



               d. Each of the Texas LLCs is validly existing as a limited liability company under the Texas
Limited Liability Company Law of the Texas Business Organizations Code.



          2. The execution and delivery by each Loan Party of each Financing Document to which it is a
party, and the performance by such Loan Party of its obligations thereunder, are within its
corporate or limited liability company (as the case may be) power and authority and have been duly
authorized by all necessary corporate or limited liability company (as the case may be) action.




          3. Each Financing Document to which a Loan Party is a party has been duly executed and
delivered by it.




          4. Under the internal laws of the State of Texas, each of the Financing Documents to which a
Loan Party is a party is a valid and binding obligation of such Loan Party, enforceable against
such Loan Party in accordance with its terms.




          5. Neither the execution and delivery by a Loan Party of any Financing Document to which it is
a party, nor the performance of its obligations thereunder, will (i) result in a violation by it of
(a) any statutory law or regulation applicable to such Person, or (b) the certificate of
incorporation and bylaws or certificate of formation or limited liability company agreement (as the
case may be) of such Person, or (ii) result in a breach of, or constitute a default under, the
terms of any agreement or instrument binding on such Person which is filed as an exhibit to the
Company’s Annual Report on Form 10-K for the year ended December 31, 2008.




          6. No consent, approval, authorization, or waiver of, or notice to or filing with, or other
action by, any governmental authority is required to be obtained or made by a Loan Party by any
material statutory law or regulation applicable to such Loan Party as a condition to the execution
and delivery by such Loan Party of any Financing Document to which it is a party, or the
performance by such Loan Party of its obligations under any Financing Document to which it is a
party.




 









 






Wells Fargo Bank, N.A., as Administrative Agent

March 20, 2009




          7. None of the Loan Parties is an “investment company,” as such term is defined in the
Investment Company Act of 1940, as amended.




          8. Assuming the Company complies with the provisions of the Credit Agreement relating to the
use of proceeds thereunder (whether or not therein stated as a covenant), the use by it of proceeds
from the Loans will not result in a violation of Regulation U of the Federal Reserve Board.




     The foregoing opinions expressed herein are further subject to, and qualified by, the
following assumptions, exceptions, qualifications, and limitations:



          A. The opinions expressed herein are limited exclusively to the laws of the State of Texas,
the DGCL, the Delaware LLC Act, and the federal statutory laws and regulations of the United States
of America. In respect to such laws, in addition to other limitations set forth herein, such
reference is limited to laws that are normally applicable to the transactions provided for in the
Financing Documents, and, in any event and without limitation, does not include statutes, laws,
rules, or regulations relating to (i) the operation of any asset or property, (ii) utility
regulation, (iii) antitrust, (iv) taxation, or (v) securities law, or the construction or
interpretations of any of the foregoing, or authorizations, permits, consents, and the like with
respect thereto. Reference herein to the “internal laws” of a jurisdiction is to the laws of that
jurisdiction, other than (x) that jurisdiction’s choice-of-law statutes and rules, (y) the statutes
and ordinances, the administrative decisions, and the rules and regulations of counties, towns,
municipalities, and political subdivisions (whether created or enabled through legislative action
at the federal, state, regional, or local level), and (z) judicial decisions to the extent they
deal with any of the foregoing.




          B. The opinions expressed in paragraph 4 hereof (such opinions expressed in such paragraph,
the “Remedies Opinions”) are further subject to the following:




          (i) The enforceability of the Financing Documents, and to the extent applicable, the Liens
created thereby, may be limited or affected by (a) bankruptcy, insolvency, reorganization,
moratorium, liquidation, rearrangement, conservatorship, receivership, fraudulent conveyance, or
transfer or similar laws (including court decisions) relating to or affecting the rights and
remedies of creditors generally or providing for the relief of debtors, (b) general principles of
equity, including, without limitation, requirements of good faith, fairness, and reasonableness,
and the possible unavailability of specific performance or injunctive relief (regardless of whether
enforceability is considered in a proceeding in equity or at law), (c) the refusal of a particular
court to grant (1) equitable remedies, including, without limitation, specific performance and
injunctive relief, or (2) a particular remedy sought by a Financing Party under any Financing
Document as opposed to another remedy provided for therein or another remedy available at law or in
equity, and (d) judicial discretion.




          (ii) In rendering the Remedies Opinions expressed in paragraph 4, we express no opinion as to
the validity or enforceability of any provision of any Financing Document that:




 









 






Wells Fargo Bank, N.A., as Administrative Agent

March 20, 2009





     (1) purports to (i) establish evidentiary standards or characterizations, treatments
or effects of payments or rights, in each case made or existing under, or in connection
with, any Financing Document, (ii) waive or otherwise affect any right, warranty, or
defense that cannot be waived or otherwise affected as a matter of law, (iii) negate the
effect of any course of dealing or any exercise, or failure or delay to exercise, any
right, power, privilege, or remedy, (iv) relate to indemnities, exculpation, or
contribution to the extent prohibited by public policy or require indemnification or
contribution (as applicable) for liability on account of fraud, gross negligence, willful
misconduct, breach of the performance of an agreed undertaking, violation of law or illegal
conduct (or the public policy underlying such action or conduct) of any Person seeking or
asserting the benefit of such indemnity, exculpation, or contribution provision, (v) limit
liability of any Person to claims for gross negligence or willful misconduct, (vi) grant to
any Person the right to offset special deposits against obligations owed under the
Financing Documents, (vii) authorize conclusive determinations by any party or to permit a
party to make determinations in its sole discretion, or (viii) restrict access to legal or
equitable remedies;




     (2) states that (i) prohibition, illegality, invalidity, or unenforceability of any
provision of such Financing Document in any jurisdiction shall not (a) invalidate the
remaining provisions of such Financing Document, or (b) affect that provision in any other
jurisdiction, or (ii) the right of any Person to exercise any right or remedy on the basis
of any misrepresentation or breach of warranty is not affected by any action by a Lender;




     (3) constitutes a submission to or acceptance of the jurisdiction of, or permits an
action against any Person to be brought, or waives any objection to the laying of venue or
choice of forum in such an action, in, the courts of any jurisdiction, other than the
courts of the State of Texas or the federal courts of the United States of America sitting
in the State of Texas;




     (4) permits an action against any Person to be brought in the courts of the State of
Texas (i) if such Person has not been served with process in that action in accordance with
applicable rules of procedure, or (ii) if the court in which the action is brought does not
have jurisdiction of the subject matter of the action;




     (5) permits an action against any Person to be brought in the federal courts of the
United States of America sitting in the State of Texas (i) if such Person has not been
served with process in accordance with applicable rules of procedure, or (ii) if those
courts do not have jurisdiction in the subject matter of the action;




     (6) requires the reimbursement to any Person whose breach of a recognizable standard
of performance or care in acting or failing timely or otherwise properly to act
substantially contributed to the basis for which such reimbursement is sought; or



 









 





Wells Fargo Bank, N.A., as Administrative Agent

March 20, 2009



     (7) provides for the enforcement in any jurisdiction of a judgment of the courts of
another jurisdiction.



          (iii) We have assumed that each Financing Party will act reasonably and in good faith in
performing its duties, and in exercising its rights and remedies, under the Financing Documents.
In this regard, we note that the enforceability of specific provisions of the Financing Documents
may be subject to standards of reasonableness, care and diligence and “good faith” limitations and
obligations such as those provided in Sections 1.302(b), 1.304, 1.309, and 5.109 of the Uniform
Commercial Code as in effect in the State of Texas and similar applicable principles of common law
and judicial precedent. Further, we have also assumed that each Financing Party will enforce the
respective Financing Documents in compliance with the provisions thereof and all requirements of
applicable law.




          (iv) Furthermore, we note that the maximum lawful amount or rate of interest which any
national bank, a federal savings bank or any foreign bank or branch of a foreign bank which is
subject to the jurisdiction of the federal banking laws of the United States of America, may take,
receive, reserve, contract for, or charge is governed by federal statutory law. Further, Financing
Parties that are entities other than such financial institutions may, in accordance with laws
governing their respective operation and business, be subject to statutory limits provided by the
laws other than the laws of the State of Texas. In rendering the Remedies Opinions, we express no
opinion as to whether the interest provided for in any Financing Document is in excess of any such
maximum lawful amount or rate or as to the effect of the provisions for interest in any Loan
Document on the enforceability of the Financing Documents with respect to any Financing Party
constituting a national bank or such foreign bank or branch thereof which is located in any
jurisdiction other than the State of Texas.




          C. We do not express any opinion with respect to any exhibit to, or other agreement referred
to in, any of the Financing Documents.




          D. In rendering the foregoing opinions, we have not, pursuant to our engagement, endeavored to
express any opinions, and we express no opinions, and none are intended to be implied hereby nor
shall be inferred herefrom, as to (i) the various state and federal laws, statutes, regulations,
interpretations, opinions, directives, orders, rulings, authorities, or similar matters regulating
or governing any Financing Party (collectively, the “Rules”) and/or its entry into, execution,
delivery, or performance of the Financing Documents, or the transactions provided for therein, or
the conduct of its business related thereto, or (ii) any Financing Party’s compliance with any of
the Rules in connection with any Financing Document, or the transactions provided for therein.




          E. In rendering the opinions expressed in paragraph 1 above relating to existence and good
standing, we have relied solely upon a review of certificates of public officials, without further
investigation as to matters set forth therein, and such opinions are limited to the dates of such
certificates.




 









 






Wells Fargo Bank, N.A., as Administrative Agent

March 20, 2009




          The opinions expressed herein are solely for the benefit of, and may only be relied upon by
each Financing Party, and its permitted successors and assigns, in connection with the Financing
Documents; provided however, any reliance on such opinions by a Person who becomes a party to the
Financing Documents after the date of this opinion letter shall be as to the opinions expressed
herein as of the date of this opinion letter and shall not constitute a reissuance of such opinions
as of the date of any such subsequent reliance or other subsequent date. Neither this opinion
letter nor any excerpt hereof (nor any reproduction of any of the foregoing) may be furnished to
(except in connection with a legal or arbitral proceeding or as may be required by applicable law,
and in any such events, as shall be directed and required incident thereto pursuant to a duly
issued subpoena, writ, order or other legal process), or relied upon by, any other Person without
the prior written consent of this Firm. The opinions expressed herein are as of the date hereof
(and not as of any other date, including, without limitation, the effective date of any Financing
Document if a date other than the date hereof) or, to the extent a reference to certificates of
public officials or other documents made herein, such date or dates, and we make no undertaking to
amend or supplement such opinions as facts and circumstances come to our attention or changes in
the law occur which could affect such opinions.




	 	 	 	 	 
	 	Very truly yours,



DRAFT



Fulbright & Jaworski L.L.P.

 	 



 









 






	 	 	 	 	 



SCHEDULE A

LIST OF LENDERS




Wells Fargo Bank, N.A.

Bank of America, N.A.

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

Amegy Bank, National Association

Comerica Bank

HSBC Bank USA, N.A.





 









 








SCHEDULE B

LIST OF GUARANTORS



The Persons listed immediately below, collectively, the “Delaware Corporations”



Universal Well Services, Inc.

UTI Drilling Canada, Inc.



The Persons listed immediately below, collectively the “Delaware LLCs”



Patterson (GP) LLC

Patterson-UTI Management Services, LLC

UTICO LLC



The Persons listed immediately below, collectively, the “Texas LLCs”



Ambar Lone Star Fluids Services LLC

Patterson Petroleum LLC

Patterson-UTI Drilling Company LLC



The Delaware Corporations, Delaware LLCs, and Texas LLCs, collectively, the “Guarantors.”





Exhibit F









 








EXHIBIT G




FORM OF SWING LINE LOAN NOTICE




Date: ___________, _____




To: Wells Fargo Bank, N.A., as Swing Line Lender




Ladies and Gentlemen:





     Reference is made to that certain Credit Agreement, dated as of March 20, 2009 (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
Patterson-UTI Energy, Inc., a Delaware corporation (the “Borrower”), the Lenders from time
to time party thereto, and Wells Fargo Bank, N.A., as Administrative Agent, Swing Line Lender and
an L/C Issuer.



     The undersigned hereby requests a Swing Line Borrowing:



     1. On _____________________ (a Business Day).



     2. In the amount of $_________.



     The Swing Line Borrowing complies with the provisions of Section 2.15 of Agreement, and if an
AutoBorrow Agreement is in effect on the date hereof, also complies with the terms of such
AutoBorrow Agreement.



	 	 	 	 	 
	 	PATTERSON-UTI ENERGY, INC.,

a Delaware corporation, as Borrower

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



Exhibit G









 






	 	 	 	 	 



EXHIBIT H




FORM OF PREPAYMENT NOTICE




Date: ___________, _____




To: Wells Fargo Bank, N.A., as Administrative Agent




Ladies and Gentlemen:





     Reference is made to that certain Credit Agreement, dated as of March 20, 2009 (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
Patterson-UTI Energy, Inc., a Delaware corporation (the “Borrower”), the Lenders from time
to time party thereto, and Wells Fargo Bank, N.A., as Administrative Agent and an L/C Issuer.



     The undersigned hereby gives notice of prepayment on the following Type of Loan (select one):



     o Base Rate Loans o Eurodollar Rate Loans



     1. On _____________________ (a Business Day).



     2. In the amount of $_________.



     The giving of this notice and the amount of the prepayment of the Loans indicated herein
comply with Section 2.04(a) of the Agreement.



	 	 	 	 	 
	 	PATTERSON-UTI ENERGY, INC.,

a Delaware corporation, as Borrower

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 






Exhibit H