Exhibit 4.1


 


FIRST AMENDMENT TO THE U.S. CREDIT AGREEMENT


 


THIS FIRST AMENDMENT TO
THE U.S. AMENDED AND RESTATED CREDIT AGREEMENT, dated effective as of October 19,
2005 (the “Amendment”), among FOREST OIL CORPORATION, a New York corporation (the “U.S. Borrower”), CANADIAN
FOREST OIL LTD. and each other subsidiary of Canadian Forest which
becomes a “Borrower” (as defined in the Canadian Credit Agreement) under the
Canadian Credit Agreement (the “Canadian Borrowers”),
each of the lenders that is a signatory to, or which becomes a signatory to,
the U.S. Credit Agreement (together with its successors and assigns, the “U.S. Lenders”), each of the lenders that is a
signatory to, or which becomes a signatory to, the Canadian Credit Agreement
(together with its successors and assigns, the “Canadian
Lenders”, and together with the U.S. Lenders, the “Combined Lenders”), BANK OF
AMERICA, N.A. and CITIBANK, N.A.,
as Co-Global Syndication Agents, BNP PARIBAS and
HARRIS NESBITT FINANCING, INC., as
Co-U.S. Documentation Agents, BANK OF MONTREAL
and THE TORONTO-DOMINION BANK, as
Co-Canadian Documentation Agents, JPMORGAN CHASE BANK, N.A.,
TORONTO BRANCH, formerly known as JPMorgan Chase Bank, Toronto
Branch, as Canadian Administrative Agent and JPMORGAN
CHASE BANK, N.A., formerly known as JPMorgan Chase Bank, as Global
Administrative Agent (in such capacity, together with its successors in such
capacity, the “Global Administrative Agent”).


 


W
I  T
N  E
S  S
E  T
H:


 


1.                                       The
U.S. Borrower, Global Administrative Agent, the Co-Global Syndication Agents,
the Co-U.S. Documentation Agents, and the U.S. Lenders are parties to that
certain Amended and Restated Credit Agreement, dated as of September 28,
2004 (as previously amended and restated, the “U.S.
Credit Agreement”), pursuant to which the U.S. Lenders agreed to
make loans to and extensions of credit on behalf of the U.S. Borrower.


 


2.                                       The
Canadian Borrowers, Global Administrative Agent, the Canadian Administrative
Agent, the Co-Global Syndication Agents, the Co-Canadian Documentation Agents,
and the Canadian Lenders are parties to that certain Amended and Restated
Credit Agreement, dated as of September 28, 2004 (as previously amended
and restated, the “Canadian Credit Agreement”,
and together with the U.S. Credit Agreement, the “Combined
Credit Agreements”), pursuant to which the Canadian Lenders agreed
to make loans to and extensions of credit on behalf of the Canadian Borrowers.


 


3.                                       The
parties to the Combined Credit Agreements intend to amend the Combined Credit
Agreements as follows:


 


NOW, THEREFORE, in
consideration of the premises and the mutual covenants herein contained, the
parties hereto agree as follows:


 


I.                                         Amendments to U.S.
Credit Agreement.


 


A.                                   Section 7.4(h) of
the U.S. Credit Agreement is hereby amended through the addition of a new
sentence at the end of Section 7.4(h) to read as follows:


 





















 


 “Notwithstanding
the foregoing, Borrower shall be permitted to transfer all or substantially all
of its Oil and Gas Properties located on the Outer Continental Shelf of the
Gulf of Mexico and State waters of the States of Louisiana and Texas (collectively, the “Offshore Gulf Properties”) to its Unrestricted Subsidiary, Forest Energy Resources, Inc.
(“FERI”), in connection with the spin-off and merger of FERI with a subsidiary
of Mariner Energy, Inc.”


 


B.                                     Section 7.5(f) of
the U.S. Credit Agreement is hereby amended through the insertion of the
following text in the last line of such Section between the words “U.S.$50,000,000;”
and the word “and”:


 


“; and provided
further that, the foregoing restriction shall not apply to the transfer
by Borrower of all or substantially all of its Offshore Gulf Properties to its
Unrestricted Subsidiary, Forest Energy Resources, Inc. (“FERI”), in
connection with the spin-off and merger of FERI with a subsidiary of Mariner
Energy, Inc.”


 


C.                                     Section 7.5(g) of
the U.S. Credit Agreement is hereby amended through the addition of the
following sentence at the end of such Section:


 


“The foregoing
restriction shall not apply to the transfer by Borrower of all or substantially
all of its Offshore Gulf Properties to its Unrestricted Subsidiary, Forest
Energy Resources, Inc. (“FERI”), in connection with the spin-off and
merger of FERI with a subsidiary of Mariner Energy, Inc.”


 


D.                                    Section 7.8(b)(3) of
the U.S. Credit Agreement is hereby amended to read as follows:


 


“(3) 50%
of the net cash proceeds received by Borrower from any sale of Equity Interests
after October 1, 2000; provided, however, that this calculation shall not
include any proceeds relating to the sale of Equity Interests in FERI (as
defined below). Notwithstanding the foregoing restriction, Borrower shall be
permitted to make a one-time dividend to the holders of its Equity Interests in
the form of Equity Interests in Borrower’s Unrestricted Subsidiary, Forest
Energy Resources, Inc. (“FERI”), in connection with the spin-off and
merger of FERI with a subsidiary of Mariner Energy, Inc.”


 


II.                                     Effectiveness.  This Amendment shall become effective as of October 19,
2005 when the Global Administrative Agent shall have received Counterparts
hereof duly executed by the U.S. Borrower, the Global Administrative Agent, the
Canadian Administrative Agent, and the Majority Lenders (or, in the case of any
party as to which an executed counterpart shall not have been received,
telegraphic, telex, or other written confirmation from such party of execution
of a counterpart hereof by such party).


 


III.                                 Reaffirmation of
Representations and Warranties.  To induce the Combined  Lenders, the Global Administrative Agent and
the Canadian Administrative Agent to enter into this Amendment, the U.S.
Borrower hereby reaffirms, as of the date hereof, the following:


 


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A.                                   The
representations and warranties of each Loan Party (as such term is defined in
the U.S. Credit Agreement and the Canadian Credit Agreement, collectively, the “Combined
Loan Parties”) set forth in the Combined Loan Documents to which it is a party
are true and correct on and as of the date hereof (or, if stated to have been
made expressly as of an earlier date, were true and correct in all material
respects as of such date).


 


B.                                     Each
of the U.S. Borrower and its Restricted Subsidiaries is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization, has all requisite power and authority to carry on its business as
now conducted and, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect, is qualified to do business in, and is in good standing in, every
jurisdiction where such qualification is required.


 


C.                                     The
execution, delivery and performance by U.S. Borrower and the Canadian Borrowers
of this Amendment are within U.S. Borrower’s and the Canadian Borrowers’ corporate
powers, and have been duly authorized by all necessary corporate action.  This Amendment has been duly executed and
delivered by U.S. Borrower and the Canadian Borrowers and, when duly executed
and delivered by the other parties hereto, will constitute, a legal, valid and
binding obligation of U.S. Borrower and the Canadian Borrowers, enforceable in
accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors’ rights generally
and subject to general principles of equity, regardless of whether considered
in a proceeding in equity or at law.


 


D.                                    The
execution, delivery and performance by the U.S. Borrower and the Canadian
Borrowers of this Amendment (i) do not require any Governmental Approval
or third party approvals, except such as have been obtained or made and are in
full force and effect, (ii) will not violate any applicable Governmental Rule or
the Organic Documents of U.S. Borrower and the Canadian Borrowers or any order
of any Governmental Authority, (iii) will not violate or result in a
default under any indenture, agreement or other instrument binding upon U.S.
Borrower or the Canadian Borrowers or either of their assets, or give rise to a
right thereunder to require any payment to be made by U.S. Borrower or the
Canadian Borrowers, and (iv) will not result in the creation or imposition
of any Lien on any asset of U.S. Borrower or the Canadian Borrowers.


 


E.                                      No
Default under the Combined Loan Documents has occurred and is continuing and
the U.S. Borrower is in compliance with the financial covenants set forth in Article VI of the U.S. Credit Agreement.


 


F.                                      No
event or events have occurred which individually or in the aggregate could
reasonably be expected to have a Material Adverse Effect.


 


IV.                                Defined Terms.  Except as amended hereby, terms used herein
when defined in the U.S. Credit Agreement shall have the same meanings herein
unless the context otherwise requires.


 


V.                                    Reaffirmation of
Combined Credit Agreements.  This Amendment shall be deemed to be an
amendment to the Combined Credit


 


3





















 


Agreements,
and the Combined Credit Agreements, as amended hereby, are hereby ratified,
approved and confirmed in each and every respect.  All references to the Combined Credit
Agreements herein and in any other document, instrument, agreement or writing
shall hereafter be deemed to refer to the Combined Credit Agreements as amended
hereby.


 


VI.                                Governing Law.  THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.


 


VII.                            Severability of
Provisions. Any provision of this Amendment held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability
without affecting the validity, legality and enforceability of the remaining
provisions hereof; and the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other jurisdiction.


 


VIII.                        Counterparts. This
Amendment may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract.  Delivery of an executed counterpart of a
signature page of this Amendment by telecopy shall be effective as
delivery of a manually executed counterpart of this Amendment.


 


IX.                                Headings.  Article and section headings used
herein are for convenience of reference only, are not part of this Amendment
and shall not affect the construction of, or be taken into consideration in
interpreting, this Amendment.


 


X.                                    Successors and
Assigns.  This Amendment
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns.


 


XI.                                No Oral Agreements.  THIS AMENDMENT, THE COMBINED CREDIT AGREEMENTS, AS AMENDED HEREBY, AND
THE OTHER COMBINED LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS,
OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.


 


THERE ARE NO UNWRITTEN ORAL AGREEMENTS
BETWEEN THE PARTIES.


 


[SIGNATURES
BEGIN ON FOLLOWING PAGE]


 


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IN WITNESS WHEREOF, the U.S. Borrower, the
Canadian Borrower, the Combined undersigned Lenders, the Global Administrative
Agent, and the other “agents” under the Combined Credit Agreements have
executed this Amendment as of the date first above written.


 


 


	
   

  	
  U.S.
  BORROWER

  
	
   

  	
   

  	
   

  
	
   

  	
  FOREST OIL
  CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ DAVID H.
  KEYTE

  
	
   

  	
  Name:

  	
  David H.
  Keyte

  
	
   

  	
  Title:

  	
  Executive
  Vice President and Chief

  
	
   

  	
  Financial
  Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CANADIAN
  BORROWER

  
	
   

  	
   

  	
   

  
	
   

  	
  CANADIAN
  FOREST OIL LTD.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ CAROLINE
  M. MCCLURG

  
	
   

  	
  Name:

  	
  Caroline M.
  McClurg

  
	
   

  	
  Title:

  	
  Treasurer

  



 


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  AGENTS
  AND COMBINED LENDERS

  
	
   

  	
   

  
	
   

  	
  JPMORGAN
  CHASE BANK, N.A.,

  formerly known as JPMorgan Chase Bank,

  as Global Administrative Agent and as a

  U.S. Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ ROBERT C. MERTENSOTTO

  	 

	
   

  	
  Name:

  	
  Robert C. Mertensotto

  
	
   

  	
  Title:

  	
  Managing Director

  
					



 


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  BANK OF AMERICA, N.A., as a
  Co-Global

  Syndication Agent and as a U.S. Lender

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  /s/ JOSEPH F. SCOTT

  
	
   

  	
  Name:

  	
  Joseph F. Scott

  	 

	
   

  	
  Title:

  	
  Vice President

  	 

					



 


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  CITIBANK, N.A., as a
  Co-Global

  Syndication Agent and as a U.S. Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ TODD J. MOGIL

  
	
   

  	
  Name:

  	
  Todd J. Mogil

  
	
   

  	
  Title:

  	
  Attorney-In-Fact

  
				



 


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  BNP PARIBAS, as a Co-U.S.

  Documentation Agent and as a U.S. Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ DAVID DODD

  
	
   

  	
  Name:

  	
  David Dodd

  
	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ BETSY JOCHER

  
	
   

  	
  Name:

  	
  Betsy Jocher

  
	
   

  	
  Title:

  	
  Vice President

  
				



 


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  HARRIS NESBITT FINANCING, INC.,

  as a Co-U.S. Documentation Agent and as a

  U.S. Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ JAMES V. DUCOTE

  
	
   

  	
  Name:

  	
  James V. Ducote

  
	
   

  	
  Title:

  	
  Vice President

  
				



 


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  CREDIT SUISSE, Cayman Islands Branch (formerly known
  as CREDIT SUISSE FIRST BOSTON, acting through its
  Cayman Islands branch, as a Lender)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ VANESSA GOMEZ

  
	
   

  	
  Name:

  	
  Vanessa Gomez

  
	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ NUPUR KUMAR

  
	
   

  	
  Name:

  	
  Nupur Kumar

  
	
   

  	
  Title:

  	
  Associate

  
				



 


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  U.S. BANK NATIONAL ASSOCIATION,

  as a Lender

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  /s/ MATTHEW J. PURCHASE

  
	
   

  	
  Name:

  	
  Matthew J. Purchase

  	 

	
   

  	
  Title:

  	
  Vice President

  	 

					



 


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  THE BANK OF NOVA SCOTIA, as a

  Lender

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  /s/ N. BELL

  
	
   

  	
  Name:

  	
  N. Bell

  	 

	
   

  	
  Title:

  	
  Sr. Manager

  	 

					



 


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  FORTIS
  CAPITAL CORP.,
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ DAVID MONTGOMERY

  
	
   

  	
  Name:

  	
  David Montgomery

  
	
   

  	
  Title:

  	
  Senior Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ DARRELL HOLLEY

  
	
   

  	
  Name:

  	
  Darrell Holley

  
	
   

  	
  Title:

  	
  Managing Director

  
				



 


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  DEUTSCHE BANK TRUST COMPANY

  AMERICAS, as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ MARCUS TARKINGTON

  
	
   

  	
  Name:

  	
  Marcus Tarkington

  
	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ OMAYRA LAUCELLA

  
	
   

  	
  Name:

  	
  Omayra Laucella

  
	
   

  	
  Title:

  	
  Vice President

  
				



 


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  BANK OF SCOTLAND, as a
  Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ KAREN WEICH

  
	
   

  	
  Name:

  	
  Karen Weich

  
	
   

  	
  Title:

  	
  Assistant Vice President

  
				



 


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  ABN AMRO BANK N.V., as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ SCOTT DONALDSON

  
	
   

  	
  Name:

  	
  R. Scott Donaldson

  
	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ TODD D. VAUBEL

  
	
   

  	
  Name:

  	
  Todd D. Vaubel

  
	
   

  	
  Title:

  	
  Assistant Vice
  President

  
				



 


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  UBS LOAN FINANCE LLC, as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ JOSELIN FERNANDES

  
	
   

  	
  Name:

  	
  Joselin Fernandes

  
	
   

  	
  Title:

  	
  Associate Director

  Banking Products

  Services, US

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ MARIA PINA

  
	
   

  	
  Name:

  	
  Maria Pina

  
	
   

  	
  Title:

  	
  Associate Director

  Banking Products

  Services, US

  
				



 


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  TORONTO DOMINION (TEXAS) LLC
  (as

  successor in interest to Toronto Dominion (Texas),

  Inc.), as a
  Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ JIM BRIDWELL

  
	
   

  	
  Name:

  	
  Jim Bridwell

  
	
   

  	
  Title:

  	
  Authorized Agent

  
				



 


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  COMPASS BANK, as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ PATRICK MCWILLIAMS

  
	
   

  	
  Name:

  	
  Patrick McWilliams

  
	
   

  	
  Title:

  	
  Asst. Vice President

  
				



 


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  HIBERNIA NATIONAL BANK, as
  a  Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ CORWIN DUPREE

  
	
   

  	
  Name:

  	
  Corwin Dupree

  
	
   

  	
  Title:

  	
  Vice President

  
				



 


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  JPMORGAN CHASE BANK, N.A.,

  TORONTO BRANCH, formerly known as

  JPMorgan Chase Bank, Toronto Branch, as

  Canadian Administrative Agent and as a

  Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ D. MCDONALD

  
	
   

  	
  Name:

  	
  Drew McDonald

  
	
   

  	
  Title:

  	
  Vice President

  
				



 


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  BANK OF MONTREAL, as a Co-Canadian

  Documentation Agent and as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ JAMES V. DUCOTE

  
	
   

  	
  Name:

  	
  James V. Ducote

  
	
   

  	
  Title:

  	
  Vice President

  
				



 


S-19





















 


	
   

  	
  THE TORONTO-DOMINION BANK, as a

  Co-Canadian Documentation Agent and as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ D. BRITO

  
	
   

  	
  Name:

  	
  Debbi Brito

  
	
   

  	
  Title:

  	
  Manager, Credit
  Compliance

  and Administration—Canada

  
				



 


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  BANK OF AMERICA, N.A., CANADA

  BRANCH, as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ MEDINA SALES DE ANDRADE

  
	
   

  	
  Name:

  	
  Medina Sales de Andrade

  
	
   

  	
  Title:

  	
  Assistant Vice
  President

  
				



 


 


S-21





















 


	
   

  	
  CITIBANK, N.A., CANADIAN
  BRANCH, as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. HASTINGS

  
	
   

  	
  Name:

  	
  John R. Hastings

  
	
   

  	
  Title:

  	
  Managing Director

  
				



 


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