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Exhibit 10.1  



	 	 	Facility

CUSIP No. 55387QAB5
	

 	
 	

Revolving Commitment

CUSIP No. 55387QAA7









 

CREDIT AGREEMENT  


Dated as of December 21, 2005 


among



MV PARTNERS, L.P.,


as
Borrower, 


BANK OF AMERICA, N.A.,  


as Administrative Agent, Swing Line Lender

and L/C Issuer, 


and 


The
Other Lenders Party Hereto 






 








 
 

TABLE OF CONTENTS    
    



	Section
 
	 	 
	 	Page

	ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS	 	1
	 	1.01	 	Defined Terms	 	1
	 	1.02	 	Other Interpretive Provisions	 	16
	 	1.03	 	Accounting Terms	 	16
	 	1.04	 	Rounding	 	17
	 	1.05	 	Times of Day	 	17
	 	1.06	 	Letter of Credit Amounts	 	17
	

ARTICLE II. THE COMMITMENTS AND CREDIT EXTENSIONS	
 	

17
	 	2.01	 	Committed Loans	 	17
	 	2.02	 	Borrowings, Conversions and Continuations of Committed Loans	 	17
	 	2.03	 	Letters of Credit	 	19
	 	2.04	 	Swing Line Loans	 	25
	 	2.05	 	Prepayments	 	28
	 	2.06	 	Reduction of Commitments or Reduction of Commitments Termination	 	29
	 	2.07	 	Repayment of Loans	 	29
	 	2.08	 	Interest	 	30
	 	2.09	 	Fees	 	30
	 	2.10	 	Computation of Interest and Fees	 	30
	 	2.11	 	Evidence of Debt	 	30
	 	2.12	 	Payments Generally; Agent's Clawback	 	31
	 	2.13	 	Sharing of Payments	 	32
	 	2.14	 	Initial Borrowing Base	 	33
	 	2.15	 	Subsequent Determinations of Borrowing Base	 	33
	

ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY	
 	

34
	 	3.01	 	Taxes	 	34
	 	3.02	 	Illegality	 	35
	 	3.03	 	Inability to Determine Rates	 	35
	 	3.04	 	Increased Costs	 	36
	 	3.05	 	Compensation for Losses	 	37
	 	3.06	 	Mitigation Obligations	 	37
	 	3.07	 	Survival	 	37
	

ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS	
 	

37
	 	4.01	 	Conditions of Initial Credit Extension	 	37
	 	4.02	 	Conditions to all Credit Extensions	 	39
	

ARTICLE V. REPRESENTATIONS AND WARRANTIES	
 	

39
	 	5.01	 	Existence, Qualification and Power; Compliance with Laws	 	39
	 	5.02	 	Authorization; No Contravention	 	40
	 	5.03	 	Governmental Authorization; Other Consents	 	40
	 	5.04	 	Binding Effect	 	40
	 	5.05	 	Financial Statements; No Material Adverse Effect	 	40
	 	5.06	 	Litigation	 	40
	 	5.07	 	No Default	 	41
	 	5.08	 	Ownership of Property; Liens	 	41
	 	5.09	 	Environmental Compliance	 	41
	 	5.10	 	Insurance	 	41
	 	5.11	 	Taxes	 	41
	 	5.12	 	ERISA Compliance	 	41
	 	5.13	 	Subsidiaries	 	42
	 	 	 	 	 








 

	 	5.14	 	Margin Regulations; Investment Company Act; Public Utility Holding Company Act	 	42
	 	5.15	 	Disclosure	 	42
	 	5.16	 	Compliance with Laws	 	42
	 	5.17	 	Leases; Contracts; Licenses, Etc.	 	42
	 	5.18	 	Sale of Production	 	43
	 	5.19	 	Operation of Oil and Gas Properties	 	44
	 	5.20	 	Ad Valorem and Severance Taxes; Litigation	 	44
	 	5.21	 	Intellectual Property; Licenses, Etc.	 	44
	

ARTICLE VI. AFFIRMATIVE COVENANTS	
 	

45
	 	6.01	 	Financial Statements	 	45
	 	6.02	 	Certificates; Other Information	 	45
	 	6.03	 	Notices	 	46
	 	6.04	 	Payment of Obligations	 	47
	 	6.05	 	Preservation of Existence, Etc.	 	47
	 	6.06	 	Maintenance of Properties	 	47
	 	6.07	 	Maintenance of Insurance	 	47
	 	6.08	 	Compliance with Laws	 	48
	 	6.09	 	Books and Records	 	48
	 	6.10	 	Inspection Rights	 	48
	 	6.11	 	Use of Proceeds	 	48
	 	6.12	 	Agreement to Deliver Security Documents	 	49
	 	6.13	 	Liens on Mortgaged Properties Acquired or Completed in the Future	 	49
	 	6.14	 	Production Proceeds	 	49
	 	6.15	 	Mortgaged Property Covenants	 	49
	 	6.16	 	Guaranties of Borrower's Subsidiaries	 	50
	 	6.17	 	Hedging Program	 	50
	 	6.18	 	Environmental Matters; Environmental Reviews	 	50
	

ARTICLE VII. NEGATIVE COVENANTS	
 	

51
	 	7.01	 	Liens	 	51
	 	7.02	 	Investments	 	51
	 	7.03	 	Indebtedness	 	51
	 	7.04	 	Fundamental Changes	 	51
	 	7.05	 	Dispositions	 	52
	 	7.06	 	Restricted Payments	 	52
	 	7.07	 	Change in Nature of Business	 	53
	 	7.08	 	Transactions with Affiliates	 	53
	 	7.09	 	Burdensome Agreements	 	53
	 	7.10	 	Use of Proceeds	 	53
	 	7.11	 	Hedging Contracts	 	53
	 	7.12	 	Financial Covenants	 	54
	

ARTICLE VIII. events of default and remedies	
 	

54
	 	8.01	 	Events of Default	 	54
	 	8.02	 	Remedies Upon Event of Default	 	56
	 	8.03	 	Application of Funds	 	56
	

ARTICLE IX. ADMINISTRATIVE AGENT	
 	

57
	 	9.01	 	Appointment and Authorization of Administrative Agent	 	57
	 	9.02	 	Rights as a Lender	 	57
	 	9.03	 	Exculpatory Provisions	 	58
	 	 	 	 	 



ii







 

	 	9.04	 	Reliance by Administrative Agent	 	58
	 	9.05	 	Delegation of Duties	 	58
	 	9.06	 	Resignation of Agent	 	59
	 	9.07	 	Non-Reliance on Agent and Other Lenders	 	59
	 	9.08	 	No Other Duties, Etc.	 	60
	 	9.09	 	Administrative Agent May File Proofs of Claim	 	60
	 	9.10	 	Guaranty Matters	 	60
	 	9.11	 	Collateral Matters	 	60
	

ARTICLE X. MISCELLANEOUS	
 	

62
	 	10.01	 	Amendments, Etc.	 	62
	 	10.02	 	Notices; Effectiveness; Electronic Communications	 	63
	 	10.03	 	No Waiver; Cumulative Remedies	 	64
	 	10.04	 	Expenses; Indemnity; Damage Waiver	 	64
	 	10.05	 	Payments Set Aside	 	66
	 	10.06	 	Successors and Assigns	 	66
	 	10.07	 	Treatment of Certain Information; Confidentiality	 	69
	 	10.08	 	Right of Setoff	 	69
	 	10.09	 	Interest Rate Limitation	 	70
	 	10.10	 	Counterparts; Integration; Effectiveness	 	70
	 	10.11	 	Survival of Representations and Warranties	 	70
	 	10.12	 	Replacement of Lenders	 	70
	 	10.13	 	Severability	 	71
	 	10.14	 	Governing Law; Jurisdiction; Etc.	 	71
	 	10.15	 	Waiver of Right to Trial by Jury	 	72
	 	10.16	 	USA PATRIOT Act Notice	 	72
	 	10.17	 	Time of the Essence	 	72
	 	10.18	 	Restatement	 	72
	

BANK OF AMERICA	
 	

 





	 	 	 	 	 
	
SCHEDULES	
 	

 
	    	 	 	 	 
	 	1	 	Lenders' Commitments and Applicable Percentages	 	 
	 	2	 	Security Documents	 	 
	 	3	 	Disclosure Schedule	 	 
	 	4	 	Addresses	 	 
	
EXHIBITS	
 	

 
	

    Form of	
 	

 
	 	A	 	Committed Loan Notice	 	 
	 	B	 	Swing Line Loan Notice	 	 
	 	C	 	Note	 	 
	 	D	 	Compliance Certificate	 	 
	 	E	 	Assignment and Assumption	 	 
	 	F	 	Legal Opinions	 	 
	 	G	 	Assignment, Assumption and Mortgage Amendment	 	 




iii









 
 

CREDIT AGREEMENT    
    


        CREDIT AGREEMENT (this "Agreement") is entered into as of December 21, 2005, among MV PARTNERS, L.P., an
Kansas limited partnership ("Borrower"), each lender from time to time party hereto (collectively,
"Lenders" and individually, a "Lender"), and BANK OF AMERICA, N.A., as Administrative Agent, Swing Line
Lender and L/C Issuer. 


        Borrower
has requested that Lenders provide a revolving credit facility, and 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" or "Agent" means Bank of America in its capacity as administrative
agent under any of the Loan Documents, or any successor administrative agent. 


        "Administrative Agent's Office" means Agent's address and, as appropriate, account as set forth on  Schedule 4, or such other address or account as Agent may from
time to time notify Borrower and Lenders. 


        "Administrative Questionnaire" means an Administrative Questionnaire in a form supplied by 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. 


        "Agent Fee Letter" has the meaning specified in Section 2.09 (b). 


        "Aggregate Commitments" means the Commitments of all Lenders, but in no event to exceed the Maximum Credit Amount. 


        "Agreement" means this Credit Agreement. 


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


        "Applicable Rate" means, from time to time, the following percentages per annum, based upon the Borrowing Base Usage: 



	Pricing

Level
	 	Borrowing Base Usage
	 	Unused Fee
	 	Eurodollar Rate +

Letters of Credit
	 	Base Rate
	 
	I	 	greater than or equal to 80%	 	0.375	%	1.75	%	0.75	%
	II	 	less than 80% but greater than or equal to 66%	 	0.250	%	1.50	%	0.50	%
	II	 	less than 66% but greater than or equal to 33%	 	0.250	%	1.25	%	0.25	%
	III	 	less than 33%	 	0.125	%	1.00	%	0.00	%










 

        "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 Agent, in substantially the form of  Exhibit E or any other form approved by
Agent. 



        "Assignment, Assumption and Mortgage Amendment" means the instrument in the form of Exhibit G  hereto. 


        "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 Borrower and its Subsidiaries for the fiscal year ended
December 31, 2004, and the related consolidated statements of income or operations, shareholders' equity and cash flows for such fiscal year of Borrower and its Subsidiaries, including the
notes thereto. 


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


        "Bank of America" means Bank of America, N.A. and its successors. 


        "Base Rate" means for any day a fluctuating rate per annum equal to the higher of (a) the Federal Funds Rate plus
1/2 of 1% and (b) the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its "prime rate." The "prime rate" is a rate set by
Bank of America based upon various factors including Bank of America's costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans,
which may be priced at, above, or below such announced rate. Any change in such rate announced by Bank of America shall take effect at the opening of business on the day specified in the public
announcement of such change. 


        "Base Rate Committed Loan" means a Committed Loan that is a Base Rate Loan. 


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


        "Borrower" has the meaning specified in the introductory paragraph hereto. 


        "Borrower Materials" has the meaning specified in Section 6.02. 


        "Borrowing" means a Committed Borrowing or a Swing Line Borrowing, as the context may require. 


        "Borrowing Base" means, at the particular time in question, either the amount provided for in  Section 2.14 or the amount determined by Administrative Agent and
Required Lenders (or all Lenders in the case of an increase in the Borrowing
Base) in accordance with the provisions of Section 2.15 (a) or (c); provided, however, that in no
event shall the Borrowing Base ever exceed the Aggregate Commitments. 


        "Borrowing Base Deficiency" has the meaning specified in Section 2.05(d). 



        "Borrowing Base Period" has the meaning specified in Section 2.15(a). 


        "Borrowing Base Usage" means on any date the percentage, at the close of business on such day, equivalent to the (i) Facility Usage
divided by (ii) the Borrowing Base. 


2







 



        "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 Administrative Agent's Office is located and, if such day relates to any Eurodollar Rate Loan, means any such day on which dealings in Dollar deposits are
conducted by and between banks in the London interbank eurodollar market. 


        "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)   General
Partner ceases to be the sole general partner of Borrower; or 


        (b)   Any
Person, other than David Murfin, J. Michael Vess or companies or trusts Controlled by or established for the benefit of either of such individuals or their
respective heirs at law (such as companies or trusts established for estate planning purposes) shall directly or indirectly Control the General Partner; or 



        (c)   Any
individual other than David Murfin or J. Michael Vess shall be the chief executive officers or sole managers of the General Partner or shall be actively performing
the duties customarily associated with such positions. 




        "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. 



        "Collateral" means all property of any kind which is subject to a Lien in favor of Lenders (or in favor of Administrative Agent for the
benefit of Lenders) or which, under the terms of any Security Document, is purported to be subject to such a Lien. 


        "Commitment" means, as to each Lender, its obligation to (a) make Committed Loans to Borrower pursuant to  Section 2.01, (b) purchase participations in L/C
Obligations, and (c) purchase participations in Swing Line Loans, 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. 


        "Committed Borrowing" means a borrowing consisting of simultaneous Committed 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. 


        "Committed Loan" has the meaning specified in Section 2.01. 



        "Committed Loan Notice" means a notice of (a) a Committed Borrowing, (b) a conversion of Committed 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. 


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



        "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 


3







 



for
such period, (ii) the provision for Federal, state and local income taxes payable by the Borrower and its Subsidiaries for such period, and (iii) depreciation, depletion and
amortization expense and other non-cash charges (including those resulting from the FASB 133, as amended, or FASB 143 or FASB 144. 


        "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 but including extraordinary losses) for that period. 


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


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


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


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


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


        "Default Rate" means (a) when used with respect to Obligations other than L/C 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 L/C 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 Committed Loans, participations in L/C
Obligations or participations in Swing Line Loans required to be funded by it hereunder within one Business Day of the date required to be funded by it hereunder, (b) has otherwise failed to
pay over to Agent or any other Lender any other amount required to be paid by it hereunder within one Business Day of the date when due, unless the subject of a good faith dispute, or (c) has
been deemed insolvent or become the subject of a bankruptcy or insolvency proceeding. 


        "Determination Date" has the meaning specified in Section 2.15(a). 


        "Disclosure Schedule" means Schedule 3 hereto. 



        "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. 


4







 



        "Dollar" and "$" mean lawful money of the United States. 


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


        "Engineering Report" means the Initial Engineering Report and each engineering report delivered pursuant to  Section 6.02(f) or Section 6.02 (g). 


        "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 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. 


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



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


5







 



        "Eurodollar Base Rate" has the meaning specified in the definition of Eurodollar Rate. 



        "Eurodollar Rate" means for any Interest Period with respect to a Eurodollar Rate Loan, a rate per annum determined by Agent pursuant to
the following formula: 



	

Eurodollar Rate -	
 	

Eurodollar Base Rate
 1.00 - Eurodollar Reserve Percentage






        Where,



        "Eurodollar Base Rate" means, for such Interest Period (rounded upwards, as necessary, to the nearest 1/100 of 1%) the rate per annum
equal to the British Bankers Association LIBOR Rate ("BBA LIBOR"), as published by Reuters (or other commercially available source providing quotations
of BBA LIBOR as designated by Agent from time to time) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, for Dollar deposits (for
delivery on the first day of such Interest Period) with a term equivalent to such Interest Period. If such rate is not available at such time for any reason, then the
"Eurodollar Base Rate" for such Interest Period (rounded upwards, as necessary, to the nearest 1/100 of 1%) shall be the rate per annum determined by
Agent to be the rate at which deposits in Dollars for delivery on the first day of such Interest Period in same day funds in the approximate amount of the Eurodollar Rate Loan being made, continued or
converted by Bank of America and with a term equivalent to such Interest Period would be offered by Bank of America's London Branch to major banks in the London interbank eurodollar market at their
request at approximately 11:00 a.m. (London time) two Business Days prior to the commencement of such Interest Period. 


        "Eurodollar Reserve Percentage" means, for any day during any Interest Period, the reserve percentage (expressed as a decimal, carried out
to five decimal places) in effect on such day, whether or not applicable to any Lender, under regulations issued from time to time by the Board of Governors of the Federal Reserve System of the United
States for determining the maximum reserve requirement (including any emergency, supplemental or other marginal reserve requirement) with respect to Eurocurrency funding (currently referred to as
"Eurocurrency liabilities"). The Eurodollar Rate for each outstanding Eurodollar Rate Loan shall be adjusted automatically as of the effective date of
any change in the Eurodollar Reserve Percentage. 


        "Eurodollar Rate Loan" means a Committed Loan that bears interest at a rate based on the Eurodollar Rate. 



        "Event of Default" has the meaning specified in Section 8.01. 


        "Existing Credit Agreement" has the meaning given in Section 4.01(a)(x). 


        "Excluded Taxes" means, with respect to Agent, any Lender, the L/C Issuer or any other recipient of any payment to be made by or on
account of any obligation of 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 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, and (b) any branch profits taxes imposed by the United States or any similar tax imposed by any other jurisdiction in which Borrower is located. 


        "Facility Usage" means, at the time in question, the Outstanding Amount of Loans and L/C Obligations. 


        "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 


6







 



Business
Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such
rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day,
the Federal Funds Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on such day on such transactions as
determined by Agent. 


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


        "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. 


        "General Partner" means MV Energy, LLC, a Kansas limited liability company. 


        "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, any (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. 


        "Guarantor" means each Subsidiary of the Borrower. 


        "Guaranty" means the Guaranty made by the Guarantor in favor of Agent for the benefit of the Lenders, in form and substance satisfactory
to Agent. 


        "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. 


7









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


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


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



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


        (f)    capital
leases and Synthetic Lease Obligations; 


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


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


        For
all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture (other than a joint venture that is itself a corporation or
limited liability company) in which such Person is a general partner or a joint venturer, unless such Indebtedness is expressly made non-recourse to such Person. The amount of any net
obligation under any 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). 



        "Information" has the meaning specified in Section 10.07. 


        "Initial Engineering Report" means the engineering report concerning oil and gas properties of Loan Parties dated March 26, 2005,
prepared by Cawley Gillespie & Associates reflecting reserve values as of January 1, 2006. 


        "Interest Charges" means, for any period, the sum of (a) all interest, premium payments, debt discount, fees, charges and related
expenses of the Borrower 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 with respect to such period under capital leases that is treated as interest in accordance with GAAP, all calculated
on a consolidated basis. 


        "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. 


8







 



        "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 (including a 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, two, three or six months or, to the extent available to all Lenders, twelve months thereafter, as selected by Borrower
in its Committed Loan Notice; provided that: 



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


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


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




        "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, (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, or (c) the purchase or other acquisition (in one transaction or a series of transactions) of assets of another Person that constitute a
business unit. 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. 


        "IRS" means the United States Internal Revenue Service. 


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


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


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


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


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


9







 



        "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 Committed 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 Expiration Date" means the day that is thirty days prior to the Maturity Date then in effect. 


        "L/C Fee" has the meaning specified in Section 2.03(i). 



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


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


        "L/C Sublimit" means an amount equal to $15,000,000. The L/C Sublimit is part of, and not in addition to, the Aggregate Commitments. 


        "Lender" has the meaning specified in the introductory paragraph hereto and, as the context requires, includes Swing Line Lender. 



        "Lender Counterparty" means a Lender or an Affiliate of a Lender. 


        "Lender Swap Obligations" means all obligations arising from time to time under Swap Contracts entered into from time to time between
Borrower and a Lender Counterparty; provided that if such Lender Counterparty ceases to be a Lender hereunder or an Affiliate of a Lender hereunder, Lender Swap Obligations shall not include such
obligations. 


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


        "Letter of Credit" means any standby letter of credit issued hereunder. 


        "Lien" means, with respect to any property or assets, any right or interest therein of a creditor to secure Indebtedness owed to it or any
other arrangement with such creditor which provides for the payment of such Indebtedness out of such property or assets or which allows such creditor to have such Indebtedness satisfied out of such
property or assets prior to the general creditors of any owner thereof, including any lien, mortgage, security interest, pledge, deposit, production payment, rights of a vendor under any title
retention or conditional sale agreement or lease substantially equivalent thereto, tax lien, mechanic's or materialman's lien, or any other charge or encumbrance for security purposes, whether arising
by Law or agreement or otherwise, but excluding any right of offset which arises without agreement in the ordinary course of business. "Lien" also means any filed financing statement, any registration
of a pledge (such as with an issuer of uncertificated securities), or any other arrangement or action which would serve to perfect a Lien described in the preceding sentence, regardless of whether
such financing statement is filed, such registration is made, or such arrangement or action is undertaken before or after such Lien exists. 



        "Loan" means an extension of credit by a Lender to Borrower under Article II in the
form of a Committed Loan or a Swing Line Loan. 


10







 



        "Loan Documents" means this Agreement, each Note, each Issuer Document, the Agent Fee Letter and each Security Document. 



        "Loan Parties" means, collectively, Borrower and each Person (other than Agent, the L/C Issuer, Swing Line Lender, or any Lender)
executing a Loan Document including, without limitation, each Guarantor. 


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


        "Maturity Date" means December 19, 2008. 


        "Maximum Credit Amount" means $200,000,000. 


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


        "Net Cash Proceeds" means: 


        (a)   with
respect to the sale of any Oil and Gas Properties by the Borrower or any Subsidiary pursuant to Section 7.05(f) or
(g), the excess, if any, of (i) the sum of cash and cash equivalents received in connection with such sale (including any cash received by way of deferred payment
pursuant to, or by monetization of, a note receivable or otherwise, but only as and when so received) over (ii) the sum of (A) the out-of-pocket expenses incurred
by the Borrower or any Subsidiary in connection with such sale and (B) income taxes reasonably estimated to be actually payable within two years of the date of the relevant asset sale as a
result of any gain recognized in connection therewith; 


        (b)   with
respect to casualty, condemnation or payment in respect of indemnification, the excess, if any, of (i) the sum of cash and cash equivalents received in
connection with such casualty, condemnation or payment in respect of indemnification (including any cash received by way of deferred payment pursuant to, or by monetization of, a note receivable or
otherwise, but only as and when so received) over (ii) the sum of (A) the out-of-pocket expenses incurred by the Borrower or any Subsidiary in connection with
recovery of such amounts and (B) the amount applied to repair or replacement or the payment to any Person (other than Borrower or any Subsidiary) in respect of such casualty, condemnation or
indemnification; 


        (c)   with
respect to the sale of any capital stock or other equity interest by the Borrower, the excess of (i) the sum of the cash and cash equivalents received in
connection with such sale over (ii) the underwriting discounts and commissions, and other out-of-pocket expenses, incurred by the Borrower in connection with such sale;
and 


        (d)   with
respect to the incurrence of any Indebtedness for borrowed money (but without this provision being construed to permit the incurrence of Indebtedness not otherwise
permitted by Section 7.03) by the Borrower or any Subsidiary, the excess of (i) the sum of the cash and cash equivalents received in
connection with such incurrence over (ii) the arrangement, upfront or underwriting fees, and other out-of-pocket expenses, incurred by the Borrower or such Subsidiary in
connection with such incurrence; 



provided
that Borrower may elect from time to time to treat an amounts received under clauses (a) and (b) above as not constituting Net Cash Proceeds up to an aggregate amount not to
exceed $50,000 at any one time. 


11







 



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



        "Obligations" means the Lender Swap Obligations and all advances to, and debts, liabilities, obligations, covenants and duties of, any
Loan Party arising under any Loan Document or otherwise with respect to any Loan or Letter of Credit, whether direct or indirect (including those acquired by assumption), absolute or contingent, due
or to become due, now existing or hereafter arising and including interest and fees that accrue after the commencement by or against any Loan Party 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. 



        "Oil and Gas Properties" means all oil, gas and/or mineral leases, oil, gas or mineral properties, mineral servitudes and/or mineral
rights of any kind (including, without limitation, mineral fee interests, lease interests, farmout interests, overriding royalty and royalty interests, net profits interests, oil payment interests,
production payment interests and other types of mineral interests), and all oil and gas gathering, treating, storage, processing and handling assets. 


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


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


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


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


        "Partnership Agreement" means that certain Amended and Restated Agreement of Limited Partnership of MV Partners, L.P. dated as of
December 15, 1998. 


        "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 Borrower or any ERISA Affiliate or to which Borrower or any ERISA Affiliate contributes or has an obligation
to contribute, or in the case of a multiple employer or other plan described in Section 4064(a) of ERISA, has made contributions at any time during the immediately preceding five plan years. 



        "Permits" means any permit, approval, authorization, license, registration, certificate, concession, grant, franchise, variance or
permission from any Governmental Authority. 


12







 



        "Permitted Liens" means: 


        (a)   statutory
Liens for taxes, assessments or other governmental charges or levies which are not yet delinquent or which are being contested in good faith by appropriate
action and for which adequate reserves have been maintained in accordance with GAAP; 


        (b)   landlords',
operators', carriers', warehousemen's, repairmen's, mechanics', materialmen's, or other like Liens which do not secure Indebtedness, in each case only to the
extent arising in the ordinary course of business and only to the extent securing obligations which are not delinquent or which are being contested in good faith by appropriate proceedings and for
which adequate reserves have been maintained in accordance with GAAP; 



        (c)   minor
defects and irregularities in title to any property, so long as such defects and irregularities neither secure Indebtedness nor materially impair the value of such
property or the use of such property for the purposes for which such property is held; 


        (d)   deposits
of cash or securities to secure the performance of bids, trade contracts, leases, statutory obligations and other obligations of a like nature (excluding appeal
bonds) incurred in the ordinary course of business; 


        (e)   Liens
under the Security Documents; and 


        (f)    with
respect only to property subject to any particular Security Document, Liens burdening such property which are expressly allowed by such Security Document. 


        "Permitted Tax Distributions" means, for any Fiscal Year, the product of (a) the lesser of (i) the highest combined federal
and state income tax marginal rate applicable to individual residents of Kansas or (ii) forty percent (40%) (twenty percent (20%) in the case of and with respect to net long term capital gains
of the Borrower), and (b) Borrower's taxable income (or taxable gain) under the Code. 



        "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 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. 


        "Platform" has the meaning specified in Section 6.02. 



        "Projected Oil and Gas Production" means the projected production of oil or gas (measured by volume unit or BTU equivalent, not sales
price) for the term of any Swap Contract or for a particular month, as applicable, from properties and interests owned by any Loan Party which are located in or offshore of the United States and which
have attributable to them Proved Developed Producing Reserves, as such production is projected in the most recent report delivered pursuant to  Section 6.02(f) or (g)
, after deducting projected production from any properties or interests
sold or under contract for sale that had been included in such report and after adding projected production from any properties or interests that had not been reflected in such report but that are
reflected in a separate or supplemental reports meeting the requirements of such Section 6.2(d) or  (e) and otherwise are satisfactory to
Administrative Agent. 


        "Proved Developed Producing Reserves" means Proved Reserves as defined in Definitions for Oil and Gas Reserves (in this paragraph, the
"Definitions") promulgated by the Society of Petroleum Engineers (or any generally recognized successor) as in effect at the time in question, which are categorized as both "Developed" and "Producing"
in the Definitions. 


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


13







 



        "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 Committed Loans, a Committed
Loan Notice, (b) with respect to an L/C Credit Extension, a L/C Application, and (c) with respect to a Swing Line Loan, a Swing Line Loan Notice. 



        "Required Lenders" means, as of any date of determination, Lenders having more than 65% of the Aggregate Commitments or, if the commitment
of each Lender to make Loans and the obligation of the L/C Issuer to make L/C Credit Extensions have been terminated pursuant to Section 8.02,
Lenders holding in the aggregate more than 65% 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. Any document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or
other action on the part of such Loan Party and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Loan Party. 


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


        "Scheduled Determinations" of the Borrowing Base means a determination of the Borrowing Base made pursuant to  Section 2.15(a). 



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


        "Security Schedule" means Schedule 2 hereto. 


        "Special Determinations" of the Borrowing Base has the meaning specified in  Section 2.15(c). 


        "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 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 


14







 



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


        "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 value(s) determined in accordance
therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for
such 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" means the revolving credit facility made available by Swing Line Lender pursuant to  Section 2.04. 


        "Swing Line Borrowing" means a borrowing of a Swing Line Loan pursuant to  Section 2.04. 



        "Swing Line Lender" means Bank of America 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 2.04(a). 


        "Swing Line Loan Notice" means a notice of a Swing Line Borrowing pursuant to  Section 2.04(b), which, if in writing, shall be substantially in the form of
Exhibit B. 



        "Swing Line Sublimit" means an amount equal to the lesser of (a) $500,000 and (b) the Aggregate Commitments. The Swing Line
Sublimit is part of (although uncommitted), 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. 


        "Threshold Amount" means $100,000. 


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



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


15









  





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



        "United States" and "U.S." mean the United States of America. 


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


        "Unused Borrowing Base" means, at any time of determination, the Borrowing Base minus the Facility Usage. 



        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. 


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


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


        1.03    Accounting Terms.    


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


        (b)    Changes in GAAP.    If at any time any change in GAAP would affect the computation of any financial ratio or
requirement set forth in any Loan Document, and either Borrower or the Required Lenders shall so request, Agent, Lenders and Borrower shall negotiate in good faith to amend such ratio or requirement
to preserve the original intent thereof in light of such change in GAAP (subject to 


16







 



the
approval of the Required Lenders); provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance
with GAAP prior to such change therein and (ii) Borrower shall provide to Agent and Lenders financial statements and other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP. 



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


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



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


 
 

ARTICLE II. THE COMMITMENTS AND CREDIT EXTENSIONS    
    


        2.01    Committed Loans.    Subject to the terms and conditions set forth herein, each Lender severally agrees to make
loans (each such loan, a "Committed Loan") to 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 Applicable Percentage of the Borrowing Base; provided,  however, that after giving effect to
any Committed Borrowing, (i) the Total Outstandings shall not exceed the Borrowing Base, and (ii) the
aggregate Outstanding Amount of the Committed 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, Borrower may borrow under this Section 2.01,
prepay under Section 2.05, and reborrow under this Section 2.01. Committed Loans may be
Base Rate Loans or Eurodollar Rate Loans, as further provided herein. 


        2.02    Borrowings, Conversions and Continuations of Committed Loans.    


        (a)   Each
Committed Borrowing, each conversion of Committed Loans from one Type to the other, and each continuation of Eurodollar Rate Loans shall be made upon Borrower's
irrevocable notice to Agent, which may be given by telephone. Each such notice must be received by Agent not later than 11:00 a.m. (i) three Business Days prior to the requested date of
any Borrowing of, conversion to or continuation of Eurodollar Rate Loans or of any conversion of Eurodollar Rate Loans to Base Rate Committed Loans, and (ii) on the requested date of any
Borrowing of Base Rate Committed Loans; provided, however, that if Borrower wishes to request Eurodollar
Rate Loans having an Interest Period other than one, two, three or six months in duration as provided in the definition of "Interest Period", the applicable notice must be received by Agent not later
than 11:00 a.m. four Business Days prior to the requested date of such Borrowing, conversion or continuation, whereupon Agent shall give prompt notice to Lenders of such request and determine
whether the requested Interest Period is acceptable to all of them. Not later than 11:00 a.m., three Business Days before the requested date of such Borrowing, conversion or continuation, Agent
shall notify Borrower (which notice may be by telephone) whether or not the requested Interest Period has been consented to by all 


17







 



Lenders.
Each telephonic notice by Borrower pursuant to this Section 2.02(a) must be confirmed promptly by delivery to Agent of a written
Committed Loan Notice, appropriately completed and signed by a Responsible Officer of Borrower. Each Borrowing of, conversion to or continuation of Eurodollar Rate Loans shall be in a principal amount
of $2,000,000 or a whole multiple of $500,000 in excess thereof. Except as provided in Sections 2.03(c) and  2.04(c), each Borrowing of or conversion to
Base Rate Committed Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000 in
excess thereof. Each Committed Loan Notice (whether telephonic or written) shall specify (i) whether Borrower is requesting a Committed Borrowing, a conversion of Committed 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 Committed Loans to be borrowed, converted or continued, (iv) the Type of Committed Loans to be borrowed or to which existing Committed Loans are to be
converted, and (v) if applicable, the duration of the Interest Period with respect thereto. If Borrower fails to specify a Type of Committed Loan in a Committed Loan Notice or if Borrower fails
to give a timely notice requesting a conversion or continuation, then the applicable Committed 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 Borrower requests a Borrowing of, conversion to, or
continuation of Eurodollar Rate Loans in any such Committed Loan Notice, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one month. 



        (b)   Following
receipt of a Committed Loan Notice, Agent shall promptly notify each Lender of the amount of its Applicable Percentage of the applicable Committed Loans, and
if no timely notice of a conversion or continuation is provided by Borrower, 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 Committed Borrowing, each Lender shall make the amount of its Committed Loan available to Agent in immediately available funds at Administrative Agent's Office not later
than 1:00 p.m. on the Business Day specified in the applicable Committed 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), Agent
shall make all funds so received available to Borrower in like funds as received by Agent either by (i) crediting the account of Borrower on the books of Bank of America with the amount of such
funds or (ii) wire transfer of such funds, in each case in accordance with instructions provided to (and reasonably acceptable to) Agent by Borrower;  provided, however, that if, on the date the Committed Loan Notice with respect to such Borrowing is
given by 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 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, and the Required Lenders may demand
that any or all of the then outstanding Eurodollar Rate Loans be converted immediately to Base Rate Committed Loans and Borrower agrees to pay all amounts due under  Section 3.05 in accordance with
the terms thereof due to any such conversion. 



        (d)   Agent
shall promptly notify Borrower and Lenders of the interest rate applicable to any Interest Period for Eurodollar Rate Loans upon determination of such interest
rate. 


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


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        2.03    Letters of Credit.    


        (a)    The Letter of Credit Commitment.    



          (i)  Subject
to the terms and conditions set forth herein, (A) the L/C Issuer agrees, in reliance upon the agreements of the other 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 L/C Expiration Date, to issue Letters of Credit for the account of 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 Borrower and any drawings thereunder; provided that after giving effect to any L/C Credit Extension with respect to any Letter of Credit,
(x) the Total Outstandings shall not exceed the Borrowing Base, (y) the aggregate Outstanding Amount of the Committed 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, or (z) the Outstanding Amount of the L/C Obligations shall not exceed
the L/C Sublimit. Each request by Borrower for the issuance or amendment of a Letter of Credit shall be deemed to be a representation by 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, Borrower's ability to obtain Letters of Credit
shall be fully revolving, and accordingly 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. 


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



        (A)  subject
to Section 2.03(b)(iv), the expiry date of such requested Letter of Credit would occur more than twelve
months after the date of issuance or last extension, unless the Required Lenders have approved such expiry date; or 


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




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



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


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


        (C)  except
as otherwise agreed by Agent and the 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; 


        (E)  a
default of any Lender's obligations to fund under Section 2.03(c) exists or any Lender is at such time a
Defaulting Lender hereunder, unless the L/C Issuer has entered into 




19







 





satisfactory
arrangements with Borrower or such Lender to eliminate the L/C Issuer's risk with respect to such Lender; or 



        (F)  unless
specifically provided for in this Agreement, such Letter of Credit contains any provisions for automatic reinstatement of the stated amount after any drawing
thereunder. 




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


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


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




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



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


         (ii)  Promptly
after receipt of any L/C Application at the address set forth in Section 10.02 for receiving L/C
Applications and related correspondence, the L/C Issuer will confirm with Agent (by telephone or in writing) that Agent has received a copy of such L/C Application from Borrower and, if not, the L/C
Issuer will provide Agent with a copy thereof. Unless the L/C Issuer has received written notice from any Lender, 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 in Article IV shall not then be satisfied, then,
subject to the terms and conditions hereof, the L/C Issuer shall, on the requested date, issue a Letter of Credit for the account of Borrower or enter into the applicable amendment, as the case may
be, in each case in accordance with the L/C Issuer's usual and customary business practices. Immediately upon the 



20







 




issuance
of each Letter of Credit, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the L/C Issuer a risk participation in such Letter of Credit in
an amount equal to the product of such Lender's Applicable Percentage times the amount of such Letter of Credit. 


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


        (iv)  If
Borrower so requests in any applicable L/C Application, the 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 the L/C Issuer to prevent any such extension at least once in each twelve-month period (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 the L/C Issuer, Borrower shall not be required to make a specific request to the 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) the L/C Issuer to permit the
extension of such Letter of Credit at any time to an expiry date not later than the L/C Expiration Date; provided, however, that the L/C Issuer shall not permit any such extension if (A) the
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 Agent that the Required Lenders have elected not to permit
such extension or (2) from Agent, any Lender or Borrower that one or more of the applicable conditions specified in Section 4.02 is not
then satisfied, and in each such case directing the L/C Issuer not to permit such extension. 



         (v)  If
Borrower so requests in any applicable Letter of Credit Application, the L/C Issuer may, in its sole and absolute discretion, agree to issue a Letter of Credit that
permits the automatic reinstatement of all or a portion of the stated amount thereof after any drawing thereunder (each, an "Auto-Reinstatement Letter of
Credit"). Unless otherwise directed by the L/C Issuer, Borrower shall not be required to make a specific request to the L/C Issuer to permit such reinstatement. Once an
Auto-Reinstatement Letter of Credit has been issued, except as provided in the following sentence, the Lenders shall be deemed to have authorized (but may not require) the L/C Issuer to
reinstate all or a portion of the stated amount thereof in accordance with the provisions of such Letter of Credit. Notwithstanding the foregoing, if such Auto-Reinstatement Letter of
Credit permits the L/C Issuer to decline to reinstate all or any portion of the stated amount thereof after a drawing thereunder by giving notice of such non-reinstatement within a
specified number of days after such drawing (the "Non-Reinstatement Deadline"), the L/C Issuer shall not permit such reinstatement if it has
received a notice (which may be by telephone or in writing) on or before the day that is five Business Days before the Non-Reinstatement Deadline (A) from Agent that the Required
Lenders have elected not to permit such reinstatement or (B) from Agent, any Lender or Borrower that one or more of the applicable conditions specified in  Section 4.02 is not then satisfied
(treating such reinstatement as an L/C Credit Extension for purposes of this clause) and, in each case,
directing the L/C Issuer not to permit such reinstatement. 



21







 





        (c)    Drawings and Reimbursements; Funding of Participations.    



          (i)  Upon
receipt from the beneficiary of any Letter of Credit of any notice of a drawing under such Letter of Credit, the L/C Issuer shall notify Borrower and Agent
thereof. Not later than 11:00 a.m. on the date of any payment by the L/C Issuer under a Letter of Credit (each such date, an "Honor Date"),
Borrower shall reimburse the L/C Issuer through Agent in an amount equal to the amount of such drawing. If Borrower fails to so reimburse the L/C Issuer by such time, 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, Borrower shall be deemed to have requested a Committed 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 Committed Loan
Notice). Any notice given by the L/C Issuer or Agent pursuant to this Section 2.03(c)(i) may be given by telephone if immediately confirmed in
writing; provided that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice. 


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


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


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


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



22







 




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




        (d)    Repayment of Participations.    



          (i)  At
any time after the L/C Issuer has made a payment under any Letter of Credit and has received from any Lender such Lender's L/C Advance in respect of such payment in
accordance with Section 2.03(c), if Agent receives for the account of the L/C Issuer any payment in respect of the related Unreimbursed Amount or
interest thereon (whether directly from Borrower or otherwise, including proceeds of Cash Collateral applied thereto by Agent), 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 Agent. 


         (ii)  If
any payment received by Agent for the account of the L/C Issuer pursuant to Section 2.03(c)(i) is required to
be returned under any of the circumstances described in Section 10.05 (including pursuant to any settlement entered into by the L/C Issuer in its
discretion), each Lender shall pay to Agent for the account of the L/C Issuer its Applicable Percentage thereof on demand of 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 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 Borrower to reimburse the L/C Issuer for each drawing under each
Letter of Credit and to repay each L/C Borrowing shall be absolute, unconditional and irrevocable, and shall be paid strictly in accordance with the terms of this Agreement under all circumstances,
including the following: 



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


         (ii)  the
existence of any claim, counterclaim, setoff, defense or other right that 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), the L/C Issuer or any other Person, whether in connection with this Agreement, the
transactions contemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, or any unrelated transaction; 


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



23









  



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




        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 Borrower's
instructions or other irregularity, Borrower will immediately notify the L/C Issuer. Borrower shall be conclusively deemed to have waived any such claim against the L/C Issuer and its correspondents
unless such notice is given as aforesaid. 


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


        (g)    Cash Collateral.    Upon the request of Agent, (i) if the L/C Issuer has honored any full or partial
drawing request under any Letter of Credit and such drawing has resulted in an L/C Borrowing, or (ii) if, as of the L/C Expiration Date, any L/C Obligation for any reason remains outstanding,
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 hereof, "Cash
Collateralize" means to pledge and deposit with or deliver to Agent, for the benefit of the L/C Issuer and the Lenders, as collateral for the L/C 


24







 



Obligations,
cash or deposit account balances pursuant to documentation in form and substance satisfactory to Agent and the L/C Issuer (which documents are hereby consented to by Lenders). Derivatives
of such term have corresponding meanings. Borrower hereby grants to Agent, for the benefit of the L/C Issuer and Lenders, a security interest in all such cash, deposit accounts and all balances
therein and all proceeds of the foregoing. Cash collateral shall be maintained in blocked, non-interest bearing deposit accounts at Bank of America. 



        (h)    Applicability of ISP and UCP.    Unless otherwise expressly agreed by the L/C Issuer and 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 (the "ICC") at the time of issuance shall apply to each commercial Letter of Credit. 


        (i)    L/C Fees.    Borrower shall pay to Agent for the account of each Lender in accordance with its Applicable
Percentage a L/C fee (the "L/C Fee") for each Letter of Credit equal to the Applicable Rate times the
daily amount available to be drawn under such Letter of Credit. For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall
be determined in accordance with Section 1.06. L/C 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 L/C
Expiration Date and thereafter on demand. If there is any change in the Applicable Rate during any quarter, the daily amount available to be drawn under each Letter of Credit shall be computed and
multiplied by the Applicable Rate separately for each period during such quarter that such Applicable Rate was in effect. Notwithstanding anything to the contrary contained herein, upon the request of
the Required Lenders, while any Event of Default exists, all L/C Fees shall accrue at the Default Rate. 


        (j)    Fronting Fee and Documentary and Processing Charges Payable to L/C Issuer.    Borrower shall pay directly to
the L/C Issuer for its own account a fronting fee with respect to each Letter of Credit, at
the rate per annum specified in the Agent Fee Letter, computed on the daily amount available to be drawn under such Letter of Credit and on a quarterly basis in arrears. Such fronting fee shall be due
and payable on the tenth Business Day after the end of each March, June, September and December, in respect of the most recently-ended quarterly period (or portion thereof, in the case of the first
payment), commencing with the first such date to occur after the issuance of such Letter of Credit, on the L/C Expiration Date and thereafter on demand. For purposes of computing the daily amount
available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.06. In
addition, Borrower shall pay directly to the L/C Issuer for its own account the customary issuance, presentation, amendment and other processing fees, and other standard costs and charges, of the L/C
Issuer relating to letters of credit as from time to time in effect. Such individual 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 Documents, the terms hereof shall control. 


        2.04    Swing Line Loans.    


        (a)    The Swing Line.    Subject to the terms and conditions set forth herein, Swing Line Lender agrees, in reliance
upon the agreements of the other Lenders set forth in this Section 2.04, to consider in its sole and absolute discretion making loans (each such
loan, a "Swing Line Loan") to 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 Committed Loans
and L/C Obligations of the Lender acting as Swing Line Lender, may exceed the 


25







 



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, and (ii) the aggregate Outstanding Amount of the Committed 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. The Swing Line is a discretionary, uncommitted facility and Swing Line
Lender may terminate or suspend the Swing Line at any time in its sole discretion upon notice to Borrower which notice may be given by Swing Line Lender before or after Borrower requests a Swing Line
Loan hereunder. Each Swing Line Loan shall be a Base Rate Loan. Immediately upon the making of a Swing Line Loan, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from Swing Line Lender a risk participation in such Swing Line Loan in an amount equal to the product of such Lender's Applicable Percentage  times the amount of such Swing Line Loan.



        (b)    Borrowing Procedures.    Unless the Swing Line has been terminated or suspended by the Swing Line Lender as
provided in subsection (a) above, each Swing Line Borrowing shall be made upon Borrower's irrevocable notice to Swing Line Lender and Agent, which may be given by telephone. Each such
notice must be received by Swing Line Lender and 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 Swing Line Lender and Agent of a written
Swing Line Loan Notice, appropriately completed and signed by a Responsible Officer of Borrower. Promptly after receipt by Swing Line Lender of any telephonic Swing Line Loan Notice, Swing Line Lender
will confirm with Agent (by telephone or in writing) that Agent has also received such Swing Line Loan Notice and, if not, Swing Line Lender will notify Agent (by telephone or in writing) of the
contents thereof. Unless (x) the Swing Line has been terminated or suspended by the Swing Line Lender as provided in subsection (a) above, or (y) the Swing Line Lender has
received notice (by telephone or in writing) from 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 Swing
Line Lender not to make such Swing Line Loan as a result of the limitations set forth in the proviso to the first sentence of Section 2.04(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, Swing Line Lender will, not later than 1:00 p.m. on the borrowing date specified in such Swing Line Loan Notice, make the amount of its Swing Line Loan available to Borrower at its
office by crediting the account of Borrower on the books of Swing Line Lender in immediately available funds. Lenders agree that Swing Line Lender may agree to modify the borrowing procedures used in
connection with the Swing Line in its discretion and without affecting any of the obligations of Lenders hereunder other than notifying Agent of a Swing Line Loan Notice. 



        (c)    Refinancing of Swing Line Loans.    



          (i)  Swing
Line Lender at any time in its sole and absolute discretion may request, on behalf of Borrower (which hereby irrevocably authorizes Swing Line Lender to so
request on its behalf), that each Lender make a Base Rate Committed 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 Committed 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. Swing Line Lender shall furnish Borrower with a
copy of the applicable Committed Loan Notice promptly after delivering such notice to Agent. Each Lender shall make an amount equal to its Applicable Percentage of the amount specified in such
Committed Loan Notice available to Agent in immediately available funds for the account of Swing Line Lender at the Administrative Agent's Office not later than 1:00 p.m. on the day specified
in such Committed 



26







 

Loan
Notice, whereupon, subject to Section 2.04(c)(ii), each Lender that so makes funds available shall be deemed to have made a Base Rate
Committed Loan to Borrower in such amount. Agent shall remit the funds so received to Swing Line Lender. 


         (ii)  If
for any reason any Swing Line Loan cannot be refinanced by such a Committed Borrowing in accordance with  Section 2.04(c)(i), the request for Base Rate Committed Loans submitted by Swing Line Lender
as set forth herein shall be deemed to be a request
by Swing Line Lender that each of the
Lenders fund its risk participation in the relevant Swing Line Loan and each Lender's payment to Agent for the account of Swing Line Lender pursuant to  Section 2.04(c)(i) shall be deemed payment in
respect of such participation. 


        (iii)  If
any Lender fails to make available to Agent for the account of Swing Line Lender any amount required to be paid by such Lender pursuant to the foregoing provisions
of this Section 2.04(c) by the time specified in Section 2.04(c)(i), Swing Line Lender
shall be entitled to recover from such Lender (acting through 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 Swing Line Lender at a rate per annum equal to the greater of the Federal Funds Rate and a rate determined by Swing Line Lender in accordance with banking industry
rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by swing Line Lender in connection with the
foregoing. A certificate of Swing Line Lender submitted to any Lender (through Agent) with respect to any amounts owing under this clause (iii) shall be conclusive absent manifest error. 


        (iv)  Each
Lender's obligation to make Committed Loans or to purchase and fund risk participations in Swing Line Loans pursuant to this  Section 2.04(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 Swing Line Lender, 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 Committed Loans pursuant to this Section 2.04(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 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 Swing Line Lender receives any payment on account of such Swing Line
Loan, Swing Line Lender will distribute to such Lender its Applicable Percentage of such payment (appropriately adjusted, in the case of interest payments, to reflect the period of time during which
such Lender's risk participation was funded) in the same funds as those received by Swing Line Lender. 



         (ii)  If
any payment received by Swing Line Lender in respect of principal or interest on any Swing Line Loan is required to be returned by Swing Line Lender under any of the
circumstances described in Section 10.05 (including pursuant to any settlement entered into by Swing Line Lender in its discretion), each Lender
shall pay to Swing Line Lender its Applicable Percentage thereof on demand of 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. Agent will make such demand upon the request of Swing Line Lender. The obligations of 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.    Swing Line Lender shall be responsible for invoicing Borrower for
interest on the Swing Line Loans. Until each Lender funds its Base Rate 


27







 

Committed
Loan or risk participation pursuant to this Section 2.04 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 Swing Line Lender. 



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


        2.05    Prepayments.    


        (a)   Borrower
may, upon notice to Agent, at any time or from time to time voluntarily prepay Committed Loans in whole or in part without premium or penalty;  provided that (i) such notice must be received by
Agent not later than 11:00 a.m. (A) three Business Days prior to any date of
prepayment of Eurodollar Rate Loans and (B) on the date of prepayment of Base Rate Committed Loans; (ii) any prepayment of Eurodollar Rate Loans shall be in a principal amount of
$2,000,000 or a whole multiple of $500,000 in excess thereof; and (iii) any prepayment of Base Rate Committed Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000 in
excess thereof or, in each case, if less, the entire principal amount thereof then outstanding. Each such notice shall specify the date and amount of such prepayment and the Type(s) of Committed Loans
to be prepaid. 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
Borrower, Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein. Any prepayment of a Eurodollar Rate Loan shall be
accompanied by all accrued interest on the amount prepaid, together with any additional amounts required pursuant to Section 3.05. Each such
prepayment shall be applied to the Committed Loans of Lenders in accordance with their respective Applicable Percentages. 


        (b)   Borrower
may, upon notice to Swing Line Lender (with a copy to 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 (i) such notice must be received by Swing Line Lender and Agent not later than 1:00 p.m. on the date of
the prepayment, and (ii) any such prepayment shall be in a minimum principal amount of $100,000. Each such notice shall specify the date and amount of such prepayment. If such notice is given
by Borrower, Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein. 


        (c)   If
at any time (except as set forth in 2.05(c), the Facility Usage exceeds the Borrowing Base (such excess being herein called a "Borrowing Base
Deficiency"), Borrower shall, within ten days after Administrative Agent gives notice of such fact to Borrower, either: 



          (i)  give
notice to Administrative Agent electing to prepay the principal of the Loans (and after all Loans are repaid in full, Cash Collateralize the L/C Obligations in
accordance with Section 2.03(g)) within 30 days of such notice by Borrower in an aggregate amount at least equal to such Borrowing Base
Deficiency, or 


         (ii)  give
notice to Administrative Agent that Borrower desires to provide Administrative Agent with deeds of trust, mortgages, chattel mortgages, security agreements,
financing statements and other security documents in form and substance satisfactory to Administrative Agent, granting, confirming, and perfecting first and prior liens or security interests in
collateral acceptable to Required Lenders, to the extent needed to allow Required Lenders to increase the Borrowing Base (as they in their reasonable discretion deem consistent with prudent oil and
gas banking industry lending standards at the time) to an amount which eliminates such Borrowing Base Deficiency, and then provide such security documents within thirty days after such notice by
Borrower. If, prior to any such specification by Administrative Agent, Required Lenders determine that the giving of such security documents will not serve to eliminate such Borrowing Base Deficiency,
then, within five Business Days after receiving notice of such determination from 



28







 




Administrative
Agent, Borrower will elect to make, and thereafter make, the prepayments specified in either of the preceding subsections (i) of this subsection (d). 




        (d)   The
Borrowing Base shall be reduced by the amount of any Net Cash Proceeds received after the Closing Date. 


        2.06    Reduction of Commitments or Reduction of Commitments Termination.    Borrower may, upon notice to Agent,
terminate the Aggregate Commitments, or from time to time permanently reduce the Aggregate Commitments; provided that (i) any such notice shall
be received by Agent not later than 11:00 a.m. five Business Days prior to the date of termination or reduction, (ii) any such partial reduction shall be in an aggregate amount of
$5,000,000 or any whole multiple of $1,000,000 in excess thereof, (iii) Borrower shall not terminate or reduce the Aggregate Commitments if, after giving effect thereto and to any concurrent
prepayments hereunder, the Total Outstandings would exceed the Aggregate Commitments, and (iv) if, after giving effect to any reduction of the Aggregate Commitments, the L/C 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. If following any such reduction or termination, the
Borrowing Base exceeds the Aggregate Commitments, the Borrowing Base shall be reduced to the amount of the Aggregate Commitments automatically without further action by any Person. 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.    


        (a)   Borrower
shall repay to Lenders on the Maturity Date the aggregate principal amount of Committed Loans outstanding on such date. 


        (b)   Borrower
shall repay to Swing Line Lender each Swing Line Loan on the Maturity 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; (ii) each Base Rate Committed
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. 


        (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 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, while any Event of Default exists, 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. 



29







 




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


        (a)    Unused Fee.    Borrower shall pay to Agent for the account of each Lender in accordance with its Applicable
Percentage, an unused fee equal to the Applicable Rate times the Unused Borrowing Base. The unused fee shall accrue at all times during the Availability
Period, including at any time during which one or more of the conditions in Article IV is not met, and shall be due and payable quarterly in
arrears on the last Business Day of each March, June, September and December, commencing with the first such date to occur after the Closing Date, and on the Maturity Date. The commitment fee shall be
calculated quarterly in arrears, and if there is any change in the Applicable Rate during any quarter, the actual daily amount shall be computed and multiplied by the Applicable Rate separately for
each period during such quarter that such Applicable Rate was in effect. For purposes of computing such unused fee, Swing Line Loans shall not be counted towards or considered Facility Usage. 



        (b)    Agent's Fees.    Borrower shall pay to Agent for Agent's own account, fees in the amounts and at the times
specified in the letter agreement, dated August 4, 2005 (the "Agent Fee Letter"), between Borrower and Agent. Such fees shall be fully earned
when paid and shall be nonrefundable for any reason whatsoever. 


        (c)    Lenders' Upfront Fee.    On the Closing Date, Borrower shall pay to Agent, for the account of each Lender in
accordance with their respective Applicable Percentages, an upfront fee in an amount specified in a separate fee letter between Borrower and Administrative Agent. Such upfront fees are for the credit
facilities committed by Lenders under this Agreement and are fully earned on the date paid. The upfront fee paid to each Lender is solely for its own account and is nonrefundable for any reason
whatsoever. 


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


        2.11    Evidence of Debt.    



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


30







 



manifest
error. Upon the request of any Lender made through Agent, Borrower shall execute and deliver to such Lender (through 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 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 Agent and the
accounts and records of any Lender in respect of such matters, the accounts and records of Agent shall control in the absence of manifest error. 


        2.12    Payments Generally; Agent's Clawback.    


        (a)    General.    All payments to be made by Borrower shall be made without condition or deduction for any
counterclaim, defense, recoupment or setoff. Except as otherwise expressly provided herein, all payments by Borrower hereunder shall be made to 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 12:00 noon on the date specified herein. 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
Agent after 12:00 noon 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 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. 



        (i)    Funding by Lenders; Presumption by Agent.    Unless Agent shall have received notice from a Lender prior to the
proposed date of any Committed Borrowing of Eurodollar Rate Loans (or, in the case of any Committed Borrowing of Base Rate Loans, prior to 12:00 noon on the date of such Committed Borrowing) that such
Lender will not make available to Agent such Lender's share of such Committed Borrowing, Agent may assume that such Lender has made such share available on such date in accordance with  Section 2.02
(or, in the case of a Committed Borrowing of Base Rate Loans, that such Lender has made such share available in accordance with and
at the time required by Section 2.02) and may, in reliance upon such assumption, make available to Borrower a corresponding amount. In such
event, if a Lender has not in fact made its share of the applicable Committed Borrowing available to Agent, then the applicable Lender and Borrower severally agree to pay to 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 Borrower to but excluding the date of payment
to 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 Agent in accordance with banking industry rules on interbank
compensation, plus any administrative, processing or similar fees customarily charged by Agent in connection with the foregoing and (B) in the case of a payment to be made by Borrower, the
interest rate applicable to Base Rate Loans. If Borrower and such Lender shall pay such interest to Agent for the same or an overlapping period, Agent shall promptly remit to Borrower the amount of
such interest paid by Borrower for such period. If such Lender pays its share of the applicable Committed Borrowing to Agent, then the amount so paid shall constitute such Lender's Committed Loan
included in such Committed Borrowing. Any payment by Borrower shall be without prejudice to any claim Borrower may have against a Lender that shall have failed to make such payment to Agent. 


        (ii)    Payments by Borrower; Presumptions by Agent.    Unless Agent shall have received notice from Borrower prior to
the date on which any payment is due to Agent for the account of the Lenders or the L/C Issuer hereunder that Borrower will not make such payment, Agent may 



31







 




assume
that Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to Lenders or the L/C Issuer, as the case may be, the amount due.
In such event, if Borrower has not in fact made such payment, then each of Lenders or the L/C Issuer, as the case may be, severally agrees to repay to Agent forthwith on demand the amount so
distributed to such Lender or the L/C Issuer, in immediately available funds with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date
of payment to Agent, at the greater of the Federal Funds Rate and a rate determined by Agent in accordance with banking industry rules on interbank compensation. A notice of Agent to any Lender or
Borrower with respect to any amount owing under this subsection (b) shall be conclusive, absent manifest error. 




        (b)    Failure to Satisfy Conditions Precedent.    If any Lender makes available to 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 Borrower by 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, Agent shall return such funds (in like funds as received from such Lender) to such Lender, without interest. 


        (c)    Obligations of Lenders Several.    The obligations of Lenders hereunder to make Committed Loans, to fund
participations in Letters of Credit and Swing Line Loans and to make payments under Section 10.04(c) are several and not joint. The failure of
any Lender to make any Committed 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 Committed
Loan, purchase its participation or to make its payment under Section 10.04(c): 


        (d)    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.    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 Committed Loans made by it, or the participations in L/C Obligations or in Swing Line Loans held by
it resulting in such Lender's receiving payment of a proportion of the aggregate amount of such Committed 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 Agent of such fact, and
(b) purchase (for cash at face value) participations in the Committed 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
Committed Loans and other amounts owing them, provided that: 



          (i)  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 



         (ii)  the
provisions of this Section shall not be construed to apply to (x) any payment made by 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 Committed Loans or subparticipations in L/C Obligations or
Swing Line Loans to any assignee or participant, other than to 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. 


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        2.14    Initial Borrowing Base.    The Borrowing Base shall be (i)
 $95,000,000 during
the period from the date hereof to and including June 30, 2006, (ii) $90,000,000 during the period from July 1, 2006 to and including December 31, 2006, and
(ii) $85,000,000 during the period from December 31, 2006 until the first Determination Date after such date under Section 2.15(a),
in each case unless the Borrowing Base is otherwise subject to a regular Determination under Section 2.15(a) or a Special Determination under  Section 2.15(c)
. 


        2.15    Subsequent Determinations of Borrowing Base.    



        (a)   By
April 1 and October 1 of each year, beginning April 1, 2006, Borrower shall furnish to each Lender all information, reports and data which
Administrative Agent has then requested concerning Loan Parties' businesses and properties (including their oil and gas properties and interests and the reserves and production relating thereto),
together with, as applicable, the Engineering Report as of January 1 described in Section 6.02(d) or as of July 1 described in  Section 6.02(e). Within thirty calendar days after receiving such information, reports and data, or as promptly thereafter as practicable,
Administrative Agent shall determine the amount of a proposed Borrowing Base. Administrative Agent shall then deliver to each Lender such proposed Borrowing Base. Within fifteen calendar days after
the Lender's receipt of thereof, or as promptly thereafter as practicable, all Lenders shall agree upon an amount for the Borrowing Base (provided that all Lenders must agree upon any increase in the
Borrowing Base), which need not be equal to such proposed Borrowing Base. The Lenders shall determine the amount of the Borrowing Base based upon the loan collateral value which they in their
discretion assign to the discounted net present value of the various oil and gas properties included in the Collateral of Loan Parties at the time in question and based upon such other credit factors
(including without limitation the assets, liabilities, cash flow, hedged and unhedged exposure to price, foreign exchange rate, and interest rate changes, business, properties, prospects, management
and ownership of Loan Parties and their Affiliates) as they in their discretion deem significant. If all Lenders have not approved the Borrowing Base within the fifteen calendar day period after their
receipt of such proposed Borrowing Base, Administrative Agent shall poll Lenders to ascertain the highest Borrowing Base then acceptable to all Lenders and such amount shall then become the Borrowing
Base. Administrative Agent shall by notice to Borrower designate such amount as the new Borrowing Base available to Borrower hereunder, which designation shall take effect immediately on the date such
notice is sent (herein called a "Determination Date") and shall remain in effect until but not including the next date as of which the Borrowing Base is
redetermined (each a "Borrowing Base Period"). IT IS EXPRESSLY UNDERSTOOD THAT LENDERS AND ADMINISTRATIVE AGENT HAVE NO
OBLIGATION TO AGREE UPON OR DESIGNATE THE BORROWING BASE AT ANY PARTICULAR AMOUNT, WHETHER IN RELATION TO THE MAXIMUM LOAN AMOUNT OR OTHERWISE, AND THAT LENDERS' COMMITMENTS TO ADVANCE FUNDS HEREUNDER
IS DETERMINED BY REFERENCE TO THE BORROWING BASE FROM TIME TO TIME IN EFFECT, WHICH BORROWING BASE SHALL BE USED FOR CALCULATING COMMITMENT FEES UNDER SECTION 2.5  AND, TO THE EXTENT
PERMITTED BY LAW AND REGULATORY AUTHORITIES, FOR THE PURPOSES OF CAPITAL ADEQUACY DETERMINATION AND REIMBURSEMENTS UNDER  SECTION 3.2.


        (b)   If
Borrower does not furnish all such information, reports and data by the date specified in the first sentence of subsection (a) of this section, Administrative
Agent may nonetheless designate the Borrowing Base at any amount that all Lenders determine and may redesignate the Borrowing Base from time to time thereafter until each Lender receives all such
information, reports and data, whereupon all Lenders shall designate a new Borrowing Base as described above. 


        (c)   In
addition to the redeterminations of the Borrowing Base pursuant to subsections (a) and (b) of this section, Borrower and Administrative Agent (or
Administrative Agent at the request of Required Lenders) may each request additional determinations ("Special Determinations") of the Borrowing Base
from time to time; provided, that Borrower may request no more than two (2) Special 


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Determinations
in any calendar year and Administrative Agent (or Administrative Agent at the Request of Required Lenders) may request no more than two (2) Special Determinations in the calendar
year ending December 31, 2006 and no more than one (1) Special Determinations in any calendar year thereafter. In the event Administrative Agent (or Administrative Agent at the request
of Required Lenders) requests such a Special Determination, Administrative Agent shall promptly deliver notice of such request to Borrower and Borrower shall, within twenty (20) calendar days
following the date of such request, deliver to Lenders an Engineering Report prepared by petroleum engineers who are employees of Borrower as of the last day of the calendar month preceding the date
of such request and such other information which Administrative Agent shall have requested. In the event Borrower requests a Special Determination, Borrower shall deliver written notice of such
request to Lenders which shall include (i) an Engineering Report prepared as of a date not more than thirty (30) days prior to the date of such request (or, in the case of a request made
on the 31st day of any calendar month, thirty-one (31) days), (ii) the amount of the Borrowing Base requested by Borrower and to become effective on the
Determination Date applicable to such Special Determination and (iii) such other information which Administrative Agent shall have requested. Upon receipt of such Engineering Report and other
information, Administrative Agent shall, subject to approval of all Lenders, redetermine the Borrowing Base in accordance with the procedure set forth in subsection (a) of this section, which
Borrowing Base shall become effective on the Determination Date (or as soon thereafter as Administrative Agent and all Lenders approve such Borrowing Base and provide notice thereof to Borrower). 


 
 

ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY    
    


        3.01    Taxes.    



        (a)    Payments Free of Taxes.    Any and all payments by Borrower to or on account of any obligation of 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 Borrower shall be required by
any applicable law to deduct any Indemnified Taxes (including any Other Taxes) from such payments, then, (i) the sum payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under this Section), 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) Borrower shall make such deductions, and (iii) Borrower shall timely pay the full amount deducted to the relevant Governmental Authority in
accordance with applicable law. 


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


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



        (d)    Evidence of Payments.    As soon as practicable after any payment of Indemnified Taxes or Other Taxes by
Borrower to a Governmental Authority, Borrower shall deliver to Agent the original or 


34







 



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
Agent. 


        (e)    Status of Lenders.    Any Lender, if requested by Borrower or Agent, shall deliver such documentation
prescribed by applicable law or reasonably requested by Borrower or Agent as will enable the Borrower or Agent to determine whether or not such Lender is subject to backup withholding or information
reporting requirements. 


        (f)    Treatment of Certain Refunds.    If Agent, any Lender or the L/C Issuer determines, in its sole discretion,
that it has received a refund of any Taxes or Other Taxes as to which it has been indemnified by Borrower or with respect to which Borrower has paid additional amounts pursuant to this Section, it
shall pay to Borrower an amount equal to such refund (but only to the extent of
indemnity payments made, or additional amounts paid, by 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 Agent, such Lender or the L/C Issuer, as the case may be, and without interest (other than any interest paid by the relevant Governmental Authority
with respect to such refund), provided that Borrower, upon the request of Agent, such Lender or the 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 Agent, such Lender or the L/C Issuer in the event Agent, such Lender or the L/C Issuer is
required to repay such refund to such Governmental Authority. This subsection shall not be construed to require Agent, any Lender or the L/C Issuer to make available its tax returns (or any other
information relating to its taxes that it deems confidential) to the Borrower or any other Person. 


        3.02    Illegality.    If any Lender determines that any Law has made it unlawful, or that any Governmental Authority
has asserted that it is unlawful, for any Lender or its applicable Lending Office to make, maintain or fund Eurodollar Rate Loans, or to determine or charge interest rates based upon the Eurodollar
Rate, or any Governmental Authority has imposed material restrictions on the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the London interbank market, then, on
notice thereof by such Lender to Borrower through Agent, any obligation of such Lender to make or continue Eurodollar Rate Loans or to convert Base Rate Committed Loans to Eurodollar Rate Loans shall
be suspended until such Lender notifies Agent and Borrower that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, Borrower shall, upon demand from such
Lender (with a copy to 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, Borrower shall also pay accrued interest on the amount so prepaid or converted and all amounts due under Section 3.05 in accordance
with the terms thereof due to such prepayment or conversion. 


        3.03    Inability to Determine Rates.    If Agent determines 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 Base Rate for any requested Interest Period with respect to a proposed Eurodollar Rate
Loan, or (c) the Eurodollar Base Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Loan does not adequately and fairly reflect the cost to such Lenders of
funding such Loan, Agent will promptly so notify Borrower and each Lender. Thereafter, the obligation of Lenders to make or maintain Eurodollar Rate Loans shall be suspended until Agent (upon the
instruction of the Required Lenders) revokes such notice. Upon receipt of such notice, 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 Committed Borrowing of Base Rate Loans in the amount specified therein. 


35







 



        3.04    Increased Costs.    


        (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 Rate) or the L/C Issuer; 


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



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




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


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



        (c)    Certificates for Reimbursement.    A certificate of a Lender or the L/C Issuer setting forth the amount or
amounts necessary to compensate such Lender or the L/C Issuer or its holding company, as the case may be, as specified in subsection (a) or (b) of this Section and delivered to Borrower
shall be conclusive absent manifest error. Borrower shall pay such Lender or the L/C Issuer, as the case may be, the amount shown as due on any such certificate within 30 days after receipt
thereof. 


        (d)    Delay in Requests.    Failure or delay on the part of any Lender or the L/C Issuer to demand compensation
pursuant to the foregoing provisions of this Section shall not constitute a waiver of such Lender's or the L/C Issuer's right to demand such compensation,  provided that Borrower shall not be required to
compensate a Lender or the L/C Issuer pursuant to the foregoing provisions of this Section for any
increased costs incurred or reductions suffered more than nine months prior to the date that 


36







 



such
Lender or the L/C Issuer, as the case may be, notifies Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender's or the L/C Issuer's intention to claim
compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine-month period referred to above shall be extended to
include the period of retroactive effect thereof). 


        3.05    Compensation for Losses.    Upon demand of any Lender (with a copy to Agent) from time to time, 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); or 


        (b)   any
failure by 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 Borrower; 


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. Borrower shall also pay any customary administrative fees charged by such Lender in connection with the foregoing. For purposes of calculating amounts
payable by Borrower to Lenders under this Section 3.05, each Lender shall be deemed to have funded each Eurodollar Rate Loan made by it at the
Eurodollar Base Rate used in determining the Eurodollar Rate 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.    If any Lender requests compensation under  Section 3.04, or 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. Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment. 


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


 
 

ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS    
    



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


        (a)   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 


37







 



officials,
a recent date before the Closing Date) and each in form and substance satisfactory to Agent and each of the Lenders: 



          (i)  executed
counterparts of this Agreement, the Assignment, Assumption and Mortgage Amendment and each other Security Document listed in the Security Schedule, sufficient
in number for distribution to Agent, each Lender and Borrower; 


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



        (iii)  such
certificates of resolutions or other action, incumbency certificates and/or other certificates of Responsible Officers of each Loan Party as 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 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 each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification,
except to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect; 


         (v)  favorable
opinions of counsel to the Loan Parties from counsel licensed to practice law in the State of Kansas addressed to Agent and each Lender, as to the matters
concerning the Loan Parties and the Loan Documents set forth in Exhibit F, in form and substance satisfactory to Agent; 


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


       (vii)  a
certificate signed by a Responsible Officer of Borrower certifying (A) that the conditions specified in Sections
4.02(a) and (b) have been satisfied, and (B) that there has been no event or circumstance since the date of the Audited
Financial Statements that has had or could be reasonably expected to have, either individually or in the aggregate, a Material Adverse Effect; 



      (viii)  evidence
that all insurance required to be maintained pursuant to this Agreement has been obtained and is in effect; 


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


         (x)  evidence
that the outstanding principal balance of loans under the Credit Agreement dated September 30, 2005 among Borrower, VAP-I, LLC and General
Electric Capital
Corporation, as administrative agent and lender (the "Existing Credit Agreement"), has been repaid to not more than $90,000,000; 



        (xi)  title
opinions in form, substance and authorship satisfactory to Administrative Agent, with respect to Borrower's oil and gas reserves representing a percentage of the
present discounted value of the Loan Parties proved oil and gas reserves satisfactory to each Lender; and 


       (xii)  such
other assurances, certificates, documents, consents or opinions as Agent, the L/C Issuer, 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. 


38







 

        (c)   Unless
waived by Agent, Borrower shall have paid all fees, charges and disbursements of counsel to 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 Borrower and Agent). 



        (d)   The
Closing Date shall have occurred on or before December 31, 2005. 


        (e)   On
a pro forma basis, after giving effect to the initial Loans, the payment of all loans and other liabilities in connection with the Existing Credit Agreement, the
payment of fees, closing costs and expenses in connection with this Agreement the shall be in compliance with Sections 7.12(a) and  (c). 


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 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 is subject to the following conditions precedent: 


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



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


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


        (d)   Agent
shall have received, in form and substance satisfactory to it, such other assurances, certificates, documents or consents related to the foregoing as Agent or the
Required Lenders reasonably may require. 


        Each
Request for Credit Extension submitted by 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    
    


        Borrower represents and warrants to Agent and the Lenders that: 



        5.01    Existence, Qualification and Power; Compliance with Laws.    Each Loan Party and each Subsidiary thereof
(a) is duly organized or formed, validly existing and in good standing under the Laws of the jurisdiction of its incorporation or organization, (b) has all requisite power and authority
and all requisite governmental licenses, authorizations, consents and approvals to (i) own or lease its assets and carry on its business and (ii) execute, deliver and perform its
obligations under the Loan Documents to which it is a party, (c) is duly qualified and is licensed and in good standing under the 


39







 



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) contravene the terms of any of such
Person's Organization Documents; (b) conflict with or result in any breach or contravention of, or the creation of any Lien under, or require any payment to be made under (i) any
Contractual Obligation to which such Person is a party or affecting such Person or the properties of such Person or any of its 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 and each Subsidiary thereof is in compliance with all
Contractual Obligations referred to in clause (b)(i), except to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect. 



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


        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. 


        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 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 Borrower and its Subsidiaries as of the date thereof, including liabilities for taxes, material commitments and Indebtedness. 


        (b)   The
unaudited consolidated balance sheet of Borrower and its Subsidiaries dated September 30, 2005, and the related consolidated statements of income or
operations, shareholders' equity and cash flows for the fiscal quarter ended on that date (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby,
except as otherwise expressly noted therein, and (ii) fairly present the financial condition of Borrower and its Subsidiaries as of the date thereof and their results of operations for the
period covered thereby, subject, in the case of clauses (i) and (ii), to the absence of footnotes and to normal year-end audit adjustments. 


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


        5.06    Litigation.    There are no actions, suits, proceedings, claims or disputes pending or, to the knowledge of
Borrower after due and diligent investigation, threatened or contemplated, at law, in equity, in arbitration or before any Governmental Authority, by or against 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 (including 


40







 



any
which challenge or otherwise pertain to any Loan Party's title to any Collateral), or (b) except as specifically disclosed in the Disclosure Schedule, either individually or in the
aggregate, if determined adversely, could reasonably be expected to have a Material Adverse Effect, and there has been no adverse change in the status, or financial effect on any Loan Party or any
Subsidiary thereof, of the matters described in the Disclosure Schedule. 



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


        5.08    Ownership of Property; Liens.    Each of Borrower and each Subsidiary has good record and marketable 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 not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect. The property of Borrower and its Subsidiaries is subject to no Liens, other than Liens permitted by  Section 7.01. 


        5.09    Environmental Compliance.    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 Borrower has reasonably concluded that, except as specifically disclosed in the Disclosure Schedule, 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 Borrower and its Subsidiaries are insured with financially sound and reputable
insurance companies, not Affiliates of Borrower, in such amounts (after giving effect to any self-insurance compatible with the following standards), with such deductibles and covering
such risks as are customarily carried by companies engaged in similar businesses and owning similar properties in localities where Borrower or the applicable Subsidiary operates. 



        5.11    Taxes.    Borrower and its Subsidiaries have filed all Federal, state and other material tax returns and
reports required to be filed, and have paid all Federal, state and other material taxes, assessments, fees and other governmental charges levied or imposed upon them or their properties, income or
assets otherwise due and payable, except those which are being contested in good faith by appropriate proceedings diligently conducted and for which adequate reserves have been provided in accordance
with GAAP. There is no proposed tax assessment against Borrower or any Subsidiary that would, if made, have a Material Adverse Effect. 



        5.12    ERISA Compliance.    


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


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


41









  





        (c)   (i) No ERISA Event has occurred or is reasonably expected to occur; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither Borrower
nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability under Title IV of ERISA with respect to any Pension Plan (other than premiums due and not delinquent under
Section 4007 of ERISA); (iv) neither Borrower nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability (and no event has occurred which, with the giving of
notice under Section 4219 of ERISA, would result in such liability) under Sections 4201 or 4243 of ERISA with respect to a Multiemployer Plan; and (v) neither 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.    As of the Closing Date, Borrower has no Subsidiaries other than those specifically disclosed
in the Disclosure Schedule, 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 in the Disclosure Schedule free and clear of all Liens. Borrower has no equity investments in any other corporation or entity other than those specifically disclosed in the Disclosure
Schedule. All of the outstanding Equity Interests in Borrower have been validly issued and are fully paid and nonassessable. 


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


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


        (b)   None
of Borrower, any Person Controlling Borrower, or any Subsidiary (i) is a "holding company," or a "subsidiary company" of a "holding company," or an
"affiliate" of a "holding company" or of a "subsidiary company" of a "holding company," within the meaning of the Public Utility Holding Company Act of 1935 that is not exempt from regulation
thereunder, or (ii) is or is required to be registered as an "investment company" under the Investment Company Act of 1940. 



        5.15    Disclosure.    Borrower has disclosed to Agent and Lenders 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, taken as a whole, furnished (whether in writing or orally) by or on behalf of any Loan Party to 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 other
information so furnished) contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they
were made, not misleading; provided that, with respect to projected financial information, Borrower represents only that such information was prepared
in good faith based upon assumptions believed to be reasonable at the time. 


        5.16    Compliance with Laws.    Each of 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. 


        5.17    Leases; Contracts; Licenses, Etc.    The leases, contracts, servitudes and other agreements forming a part of
the Oil and Gas Properties of the Loan Parties covered by the Initial Engineering Report and each subsequent Engineering Report are in full force and effect. No Loan Party is in default with respect
to its obligations (and no Loan Party is aware of any default by any third party 


42







 



with
respect to such third party's obligations) under any such leases, contracts, servitudes and other agreements, or under any Permitted Liens, or otherwise attendant to the ownership or operation of
any part of the Oil and Gas Properties, where such default could adversely affect the ownership or operation of any Oil and Gas Properties. No Loan Party is currently accounting for any royalties, or
overriding royalties or other payments out of production, on a basis (other than delivery in kind) less favorable to such Loan Party than proceeds received by such Loan Party (calculated at the well)
from sale of production, and no Loan Party has any liability (or alleged liability) to account for the same on any such less favorable basis. Each Loan Party has good and defensible title to, or valid
leasehold interests in, all of the Collateral owned or leased by such Loan Party and all of its other material properties and assets necessary or used in the ordinary conduct of its business, free and
clear of all Liens, encumbrances, or adverse claims other than Permitted Liens and of all impediments to the use of such properties and assets in such Loan Party's business, except that no
representation or warranty is made with respect to any oil, gas or mineral property or interest to which no proved oil or gas reserves are properly attributed. Each Loan Party owns the net interests
in production attributable to the wells and units evaluated in the Initial Engineering Report. The ownership of such Properties does not in the aggregate in any material respect obligate such Loan
Party to bear the costs and expenses relating to the maintenance, development and operations of such Properties in an amount materially in excess of the working interest of such Properties set forth
in the Initial Engineering Reports. Upon delivery of each Engineering Report furnished to the Lenders pursuant to Sections 6.02(f) and  (g), the statements
made in the preceding sentences of this section shall be true with respect to such Engineering Report. Each Loan Party possesses all
licenses, permits, franchises, patents, copyrights, trademarks and trade names, and other intellectual property (or otherwise possesses the right to use such intellectual property without violation of
the rights of any other Person) which are necessary to carry out its business as presently conducted and as presently proposed to be conducted hereafter, and no Loan Party is in violation in any
material respect of the terms under which it possesses such intellectual property or the right to use such intellectual property. 


        5.18    Sale of Production.    Except as set forth in the Disclosure Schedule, no Oil and Gas
Property is subject to any contractual or other arrangement (i) whereby payment for production is or can be deferred for a substantial period after the month in which such production is
delivered (in the case of oil, not in excess of 60 days, and in the case of gas, not in excess of 90 days) or (ii) whereby payments are made to a Loan Party other than by checks,
drafts, wire transfer advises or other similar writings, instruments or communications for the immediate payment of money. Except for production sales contracts, processing agreements, transportation
agreements and other agreements relating to the marketing of production that are listed on the Disclosure Schedule in connection with the Oil and Gas Properties to which such contract or agreement
relates: (i) no Oil and Gas Property is subject to any contractual or other arrangement for the sale, processing or transportation of production (or otherwise related to the marketing of
production) which cannot be canceled on 120 days' (or less) notice and (ii) all contractual or other arrangements for the sale, processing or transportation of production (or otherwise
related to the marketing of production) are bona fide arm's length transactions made on the best terms available with third parties not affiliated with Loan Parties. Each Loan Party is presently
receiving a price for all production from (or attributable to) each Oil and Gas Property covered by a production sales contract or marketing contract listed on the Disclosure Schedule that is computed
in accordance with the terms of such contract, and no Loan Party is having deliveries of production from such Oil and Gas Property curtailed substantially below such property's delivery capacity.
Except as set forth in the Disclosure Schedule, no Loan Party, nor any Loan Party's predecessors in title, has received prepayments (including payments for gas not taken pursuant to "take or pay" or
other similar arrangements) for any oil, gas or other hydrocarbons produced or to be produced from any Oil and Gas Properties after the date hereof. Except as set forth in the Disclosure Schedule, no
Oil and Gas Property is subject to any "take or pay" or other similar arrangement (i) which can be satisfied in whole or in part by the production or transportation of gas from other properties
or (ii) as a result of 


43







 

which
production from any Oil and Gas Property may be required to be delivered to one or more third parties without payment (or without full payment) therefor as a result of payments made, or other
actions taken, with respect to other properties. Except as set forth in the Disclosure Schedule, there is no Oil and Gas Property with respect to which any Loan Party, or any Loan Party's predecessors
in title, has, prior to the date hereof, taken more ("overproduced"), or less ("underproduced"), gas from the lands covered thereby (or pooled or unitized therewith) than its ownership interest in
such Oil and Gas Property would entitle it to take; and the Disclosure Schedule accurately reflects, for each well or unit with respect to which such an imbalance is shown thereon to exist,
(i) whether such Loan Party is overproduced or underproduced and (ii) the volumes (in cubic feet or British thermal units) of such overproduction or underproduction and the effective
date of such information. Except as set forth in the Disclosure Schedule, no Oil and Gas Property is subject to a gas balancing arrangement under which one or more third parties may take a portion of
the production attributable to such Oil and Gas Property without payment (or without full payment) therefor as a result of production having been taken from, or as a result of other actions or
inactions with respect to, other properties. No Oil and Gas Property is subject at the present time to any regulatory refund obligation and, to the best of Loan Party's knowledge, no facts exist which
might cause the same to be imposed. 


        5.19    Operation of Oil and Gas Properties.    The Oil and Gas Properties (and all properties
unitized therewith) are being (and, to the extent the same could adversely affect the ownership or operation of the Oil and Gas Properties after the date hereof, have in the past been) maintained,
operated and developed in a good and workmanlike manner, in accordance with prudent industry standards and in conformity in all material respects with all applicable Laws and in conformity in all
material respect
with all oil, gas or other mineral leases and other contracts and agreements forming a part of the Oil and Gas Property and in conformity with the Permitted Liens. No Oil and Gas Property is subject
to having allowable production after the date hereof reduced below the full and regular allowable (including the maximum permissible tolerance) because of any overproduction (whether or not the same
was permissible at the time) prior to the date hereof and (ii) none of the wells located on the Oil and Gas Properties (or properties unitized therewith) are or will be deviated from the
vertical more than the maximum permitted by applicable laws, regulations, rules and orders, and such wells are bottomed under and producing from, with the well bores wholly within, the Oil and Gas
Properties (or, in the case of wells located on properties unitized therewith, such unitized properties). There are no dry holes, or otherwise inactive wells currently required to be plugged and
abandoned by the Kansas Corporation Commission, located on the Oil and Gas Properties or on lands pooled or unitized therewith, except for wells that have been properly plugged and abandoned. Each
Loan Party has all material governmental licenses and permits necessary or appropriate to own and operate its Oil and Gas Property, and no Loan Party has received notice of any material violations in
respect of any such licenses or permits. 


        5.20    Ad Valorem and Severance Taxes; Litigation.    


        (a)   Each
Loan Party has paid and discharged all ad valorem taxes assessed against its Oil and Gas Property or any part thereof and all production, severance and other taxes
assessed against, or measured by, the production or the value, or proceeds, of the production therefrom, except those which are being contested in good faith by appropriate proceedings diligently
conducted and for which adequate reserves have been provided in accordance with GAAP. There are no suits, actions, claims, investigations, inquiries, proceedings or demands pending (or, to any Loan
Party's knowledge, threatened) which might affect the Oil and Gas Property, including any which challenge or otherwise pertain to any Loan Party's title to any Oil and Gas Property or rights to
produce and sell oil and gas therefrom. 


        5.21    Intellectual Property; Licenses, Etc.    Borrower and its Subsidiaries own, or possess
the right to use, all of the trademarks, service marks, trade names, copyrights, patents, patent rights, franchises, licenses and other intellectual property rights that are reasonably necessary for
the operation of their 


44







 



respective
businesses, without conflict with the rights of any other Person. To the best knowledge of Borrower, no slogan or other advertising device, product, process, method, substance, part or
other material now employed, or now contemplated to be employed, by Borrower or any Subsidiary infringes upon any rights held by any other Person. No claim or litigation regarding any of the foregoing
is pending or, to the best knowledge of Borrower, threatened, which, either individually or in the aggregate, could 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, 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 Agent a sufficient number of copies for delivery by Agent to each Lender,
in form and detail satisfactory to 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 Borrower, a consolidated balance sheet of 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 reports and opinions of an independent certified public
accountant firm of nationally recognized standing reasonably acceptable to the Required Lenders, which reports and opinions 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 Borrower, a consolidated
balance sheet of 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 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, certified by a Responsible Officer of Borrower as fairly presenting the financial condition, results of operations,
shareholders' equity and cash flows of such Persons in accordance with GAAP, subject only to normal year-end audit adjustments and the absence of footnotes. 


        6.02    Certificates; Other Information.    Deliver to Agent a sufficient number of copies for delivery by Agent to
each Lender, in form and detail satisfactory to 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 Borrower; 



        (c)   promptly
after any request by 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 Borrower by independent accountants in connection with the accounts or books of Borrower or any Subsidiary, or any audit of any of them; 


45







 



        (d)   by
April 1 of each year, commencing April 1, 2006, an Engineering Report prepared by Cawley Gillespie & Associates, or other independent petroleum
engineers chosen by Borrower and acceptable to Required Lenders, concerning all Oil and Gas Properties owned by any Loan Party which are located in or offshore of the United States and which have
attributable to them proved oil or gas reserves prepared as of the preceding January 1. This report shall be satisfactory to Administrative Agent, shall take into account any
"over-produced" status under gas balancing arrangements, and shall contain information and analysis comparable in scope to that contained in the Initial Engineering Report. This report
shall distinguish (or shall be delivered together with a certificate from an appropriate officer of Borrower which distinguishes) those properties treated in the report which are Collateral from those
properties treated in the report which are not Collateral; 


        (e)   by
October 1 of each year, commencing October 1, 2006, and promptly following notice of a Special Determination under  Section 2.15(c), an Engineering Report prepared as of the preceding
July1 (or the last day of the preceding calendar month in the case of a
Special Determination) by petroleum engineers who are employees of Borrower (or by the independent engineers named above), together with an accompanying report on property sales, property purchases
and changes in categories, both in the same form and scope as the reports in (d) above; 



        (f)    as
soon as available, and in any event within forty-five (45) days after the end of each calendar quarter, a report describing by lease or unit the
gross volume of production and sales attributable to production during such month from the properties described in the most recent Engineering Report and describing the related severance taxes, other
taxes, and leasehold operating expenses attributable thereto and incurred during such month; 


        (g)   concurrently
with the delivery of the financial statements referred to in Sections 6.01(a) and  (b), a report describing the Swap Contracts of the Loan Parties, in form
acceptable to Administrative Agent; and 



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


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


        6.03    Notices.    Promptly notify 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 


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


        (c)   of
the occurrence of any ERISA Event; 


        (d)   of
the receipt of Net Cash Proceeds; and 


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


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



        6.04    Payment of Obligations.    Pay and discharge as the same shall become due and payable, all its obligations and
liabilities, including (a) all tax liabilities, assessments and governmental charges or levies upon it or its properties or assets, unless the same are being contested in good faith by
appropriate proceedings diligently conducted and adequate reserves in accordance with GAAP are being maintained by Borrower or such Subsidiary; (b) all lawful claims which, if unpaid, would by
law become a Lien upon its property; 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 or 7.05; 


        (b)   take
all reasonable action to maintain all rights, privileges, permits, licenses and franchises necessary or desirable in the normal conduct of its business, except to
the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect; and 


        (c)   preserve
or renew all of its registered patents, trademarks, trade names and service marks, the non-preservation of which could reasonably be expected to
have a Material Adverse Effect. 


        6.06    Maintenance of Properties.    



        (a)   Maintain,
preserve and protect all of its material properties and equipment necessary in the operation of its business in good working order and condition, ordinary wear
and tear excepted; 


        (b)   make
all necessary repairs thereto and renewals and replacements thereof except where the failure to do so could not reasonably be expected to have a Material Adverse
Effect; and 


        (c)   use
the standard of care typical in the industry in the operation and maintenance of its facilities. 


        6.07    Maintenance of Insurance.    


        (a)   Borrower
shall at all times maintain (at its own expense) with financially sound and reputable insurance companies, not Affiliates of Borrower, insurance required by  Section 6.8 of the Partnership Agreement
as in effect on the Closing Date. All insurance policies covering Collateral shall be endorsed
(a) to provide for payment of losses to Administrative Agent as its interests may appear, (b) to provide that such policies may not be canceled or reduced or affected in any material
manner 


47







 



for
any reason without thirty (30) days prior notice to Administrative Agent, (c) to provide for any other matters specified in any applicable Security Document or which Administrative
Agent may reasonably require, and (d) to provide for insurance against fire, casualty and any other hazards normally insured against, in the amount of the full value (less a reasonable
deductible not to exceed amounts customary in the industry for similarly situated businesses and properties) of the property insured. 



        (b)   Each
policy for liability insurance shall provide for all losses to be paid on behalf of Administrative Agent (for the benefit of Lenders) and Loan Parties as their
respective interests may appear, and each policy insuring loss or damage to Collateral shall provide for all losses to be paid directly to Administrative Agent. Each such policy shall in addition
(A) name the appropriate Loan Party and Administrative Agent and Lenders as insured parties thereunder (without any representation or warranty by or obligation upon Administrative Agent or
Lenders) as their interests may appear, (B) contain the agreement by the insurer that any loss thereunder shall be payable to Administrative Agent notwithstanding any action, inaction or breach
of representation or warranty by any Loan Party, (C) provide that there shall be no recourse against Administrative Agent or Lenders for payment of premiums or other amounts with respect
thereto and (D) provide that at least thirty (30) days' prior written notice of cancellation or of lapse shall be given to Administrative Agent by the insurer. Each Loan Party will, if
so requested by Administrative Agent, deliver to Administrative Agent original or duplicate policies of such insurance and, as often as Administrative Agent may reasonably request, a report of a
reputable insurance broker with respect to such insurance. Each Loan Party will also, at the request of Administrative Agent, duly execute and deliver instruments of assignment of such insurance
policies and cause the respective insurers to acknowledge notice of such assignment. Administrative Agent is hereby authorized to enforce payment under all such insurance policies and to compromise
and settle any claims thereunder, in its own name or in the name of the Loan Parties. 


        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, write, 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.    


        (a)   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 Borrower or such Subsidiary, as the case may be; and 


        (b)   maintain
such books of record and account in material conformity with all applicable requirements of any Governmental Authority having regulatory jurisdiction over
Borrower or such Subsidiary, as the case may be. 



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


        6.11    Use of Proceeds.    Use the proceeds of the Credit Extension (i) on the Closing Date to repay or
refinance Indebtedness under the Existing Credit Agreement and cost incurred in connection 


48







 



with
the closing of this Agreement and (ii) at any other time, for work capital purposes, capital expenditures and other general company purposes not in contravention of any Law or of any Loan
Document. 


        6.12    Agreement to Deliver Security Documents.    Borrower agrees to deliver and to cause each other Loan Party to
deliver, to further secure the Obligations whenever requested by Administrative Agent in its sole and absolute discretion, deeds of trust, mortgages, chattel mortgages, security agreements, financing
statements and other Security Documents in form and substance satisfactory to Administrative Agent for the purpose of granting, confirming, and perfecting first and prior liens or
security interests in any real or personal property which is at such time Collateral or which was intended to be Collateral pursuant to any Security Document previously executed and not then released
by Administrative Agent. Borrower agrees to deliver and to cause each other Loan Party to deliver, whenever requested by Administrative Agent, in its sole and absolute discretion, transfer orders or
letters in lieu thereof with respect to the production and proceeds of production from the Collateral, in form and substance satisfactory to Administrative Agent. 


        6.13    Liens on Mortgaged Properties Acquired or Completed in the Future.    Within thirty (30) days following
each Determination Date, Borrower will execute and deliver documentation in form and substance satisfactory to Administrative Agent, granting to Administrative Agent first perfected Liens on and in
the oil, gas and mineral lease(s) covering each well (a) acquired or completed since the prior Determination Date which is capable of production of oil, gas or other hydrocarbons in paying
quantities, insofar as such lease(s) cover the proration unit assigned to such well, and (b) which is to be added to the Borrowing Base. Prior to the granting of such Liens, Borrower will
furnish to Administrative Agent title opinions in form, substance and authorship satisfactory to Required Lenders, concerning not less than seventy-five percent (75%) of the aggregate
value of such properties and will furnish all other documents and information relating to such properties as Administrative Agent may reasonably request. 



        6.14    Production Proceeds.    Notwithstanding that, by the terms of the various Security Documents, Loan Parties are
and will be assigning to Administrative Agent and Lenders all of the "Production Proceeds" (as defined therein) accruing to the property covered thereby, so long as no Default has occurred Loan
Parties may continue to receive from the purchasers of production all such Production Proceeds, subject, however, to the Liens created under the Security Documents, which Liens are hereby affirmed and
ratified. Upon the occurrence of a Default, Administrative Agent and Lenders may exercise all rights and remedies granted under the Security Documents, including the right to obtain possession of all
Production Proceeds then held by Loan Parties or to receive directly from the purchasers of production all other Production Proceeds. In no case shall any failure, whether purposed or inadvertent, by
Administrative Agent or Lenders to collect directly any such Production Proceeds constitute in any way a waiver, remission or release of any of their rights under the Security Documents, nor shall any
release of any Production Proceeds by Administrative Agent or Lenders to Loan Parties constitute a waiver, remission, or release of any other Production Proceeds or of any rights of Administrative
Agent or Lenders to collect other Production Proceeds thereafter. 


        6.15    Mortgaged Property Covenants.    



        (a)    Leases and Contracts; Performance of Obligations.    Except to the extent Disposed of (including abandonment)
pursuant to Section 7.05(f), each Loan Party will maintain in full force and effect all oil, gas or mineral leases, contracts, servitudes and
other agreements forming a part of any Oil and Gas Property, to the extent the same cover or otherwise relate to such Oil and Gas Property, and each Loan Party will timely perform all of its
obligations thereunder. Each Loan Party will promptly notify Administrative Agent of any claim (or any conclusion by such Loan Party) that such Loan Party is obligated to account for any royalties, or
overriding royalties or other payments out of production, on a basis (other than delivery in kind) less favorable to such Loan Party than proceeds received by Loan Party (calculated at the well) from
sale of production. 


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        (b)    Representation to Continue to be True.    Each Loan Party will carry out its sales of production, will
operate
the Oil and Gas Properties, and will otherwise deal with the Oil and Gas Properties and the production, in such a way that the representations and warranties in  Sections 5.18, 5.19 and 5.20 remain true and
correct at, and as of, all times that this Agreement is in effect (and not just at, and as of, the times such representations and warranties are made). 


        6.16    Guaranties of Borrower's Subsidiaries.    Each Subsidiary of Borrower now existing or created, acquired or
coming into existence after the date hereof shall, promptly upon request by Administrative Agent, execute and deliver to Administrative Agent a supplement to the Guaranty in the form attached thereto
guaranteeing the timely repayment of the Obligations and the due and punctual performance of the obligations of Borrower hereunder. Borrower will cause each of its Subsidiaries to deliver to
Administrative Agent, simultaneously with its delivery of such a supplement, written evidence satisfactory to Administrative Agent and its counsel that such Subsidiary has taken all company action
necessary to duly approve and authorize its execution, delivery and performance of such guaranty and any other documents which it is required to execute. 


        6.17    Hedging Program.    Borrower will maintain Swap Contracts fixing prices or fixing a floor for prices of not
less than $55.00 per barrel on Projected Oil and Gas Production for production expected to be produced by Borrower and its Subsidiaries for a period of not less than 36 months from the Closing
Date for not less than ninety percent (90%) of the aggregate Projected Oil and Gas Production for such period. 


        6.18    Environmental Matters; Environmental Reviews.    


        (a)   Each
Loan Party will comply in all material respects with all Environmental Laws now or hereafter applicable to such Loan Party, as well as all contractual obligations
and agreements with respect to environmental remediation or other environmental matters, and shall obtain, at or prior to the time required by applicable Environmental Laws, all environmental, health
and safety Permits and other authorizations necessary for its operations and will maintain such authorizations in full force and effect. No Loan Party will do anything or permit anything to be done
which will subject any of its properties to any remedial obligations under, or result in noncompliance with applicable Permits issued under, any applicable Environmental Laws, assuming disclosure to
the applicable governmental authorities of all relevant facts, conditions and circumstances. Upon Administrative Agent's reasonable request, at any time (but not in excess of one inspection conducted
at Borrower's expense hereunder during any 18 consecutive month period), Borrower will provide at its own expense an environmental inspection of any of the Loan Parties' material real properties and
audit of their environmental compliance procedures and practices, in each case from an engineering or consulting firm approved by Administrative Agent. 


        (b)   Borrower
will promptly furnish to Administrative Agent all written notices of violation, orders, claims, citations, complaints, penalty assessments, suits or other
proceedings received by any Loan Party, or of which Borrower otherwise has notice, pending or threatened against any Loan Party by any Governmental Authority with respect to any alleged violation of
or non-compliance with any Environmental Laws or any Permits or other authorizations in connection with any Loan Party's ownership or use of its properties or the operation of its business
that might result in a Loan Party being liable for $50,000 or more. 


        (c)   Borrower
will promptly furnish to Administrative Agent all requests for information, notices of claim, demand letters, and other notifications, received by Borrower in
connection with any Loan Party's ownership or use of its properties or the conduct of its business, relating to potential responsibility with respect to any investigation or clean-up of
Hazardous Material at any location that might result in a Loan Party being liable for $50,000 or more. 


50







 


 
 

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, 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 Permitted Liens. 


        7.02    Investments.    Make any Investments, except: 


        (a)   Investments
held by Borrower or such Subsidiary in the form of cash equivalents or short-term marketable debt securities or marketable obligations, maturing
within twelve months after acquisition thereof, issued or unconditionally guaranteed by the United States of America or an instrumentality or agency thereof and entitled to the full faith and credit
of the United states of America; 


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


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


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


        (e)   Guarantees
permitted by Section 7.03. 


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


        (a)   Indebtedness
under the Loan Documents; 


        (b)   Guarantees
of Borrower or any Subsidiary in respect of Indebtedness otherwise permitted hereunder of Borrower or any wholly-owned Subsidiary; 


        (c)   obligations
(contingent or otherwise) of Borrower or any Subsidiary existing or arising under any Swap Contract, provided
that (i) such obligations are (or were) entered into by such Person in the ordinary course of business for the purpose of directly mitigating risks associated with liabilities, commitments,
investments, assets, or property held or reasonably anticipated by such Person, or changes in the value of securities issued by such Person, and not for purposes of speculation or taking a "market
view;" (ii) such Swap Contract does not contain any provision exonerating the non-defaulting party from its obligation to make payments on outstanding transactions to the defaulting
party; (iii) and such Swap Contract does not violate the terms of Section 7.11; and 


        (d)   Indebtedness
to Affiliates in an aggregate amount not to exceed $100,000. 



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


        (a)   any
Subsidiary may merge with (i) Borrower, provided that Borrower shall be the continuing or surviving Person, or
(ii) any one or more other Subsidiaries, provided that when any wholly-owned Subsidiary is merging with another Subsidiary, the wholly-owned
Subsidiary shall be the continuing or surviving Person, and, provided further that if a Guarantor is merging with another Subsidiary, the Guarantor
shall be the surviving Person; and 


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        (b)   any
Subsidiary may Dispose of all or substantially all of its assets (upon voluntary liquidation or otherwise) to Borrower or to another Subsidiary;  provided that if the transferor in such a transaction is
a wholly-owned Subsidiary, then the transferee must either be Borrower or a wholly-owned
Subsidiary and, provided further that if the transferor of such assets is a Guarantor, the transferee must either be Borrower or a Guarantor. 


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


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


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


        (c)   Dispositions
of equipment to the extent that (i) such property is exchanged for credit against the purchase price of similar replacement property or
(ii) the proceeds of such Disposition are reasonably promptly applied to the purchase price of such replacement property; 


        (d)   Dispositions
of property by any Subsidiary to Borrower or to a wholly-owned Subsidiary; provided that if the transferor
of such property is a Guarantor, the transferee thereof must either be Borrower or a Guarantor; 


        (e)   Dispositions
permitted by Section 7.04; 


        (f)    Dispositions
of interests in oil and gas leases, or portions thereof (if released or abandoned but not otherwise sold or transferred), so long as no well situated on any
such lease, or located on any unit containing all or any part thereof, is capable (or is subject to being made capable through commercially feasible operations) of producing oil, gas or other
hydrocarbons or minerals in commercial quantities; and 


        (g)   Dispositions
of Oil and Gas Properties that are sold for fair consideration to a Person who is not an Affiliate, provided that (i) the maximum aggregate amount of
such sales in the period between two regular Determination Dates is limited to Oil and Gas Properties that account for no more than 10% of the Borrowing Base then in effect
("Permitted Property Sales"), (ii) at least 90% of the consideration received in connection with such Permitted Property Sales must be in cash or
cash equivalents; (iii) the Borrowing Base shall be decreased by the Borrowing Base value attributable to such Oil and Gas Properties (or if greater, the Net Cash Proceeds from such Permitted
Property Sale) and, after giving effect to any Permitted Property Sale and to the applicable of the proceeds to outstanding Credit Extensions, no Borrowing Base Deficiency shall exist; and
(iv) after giving effect to any Permitted Property Sale no Default or Event of Default shall exist; 



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




No
Loan Party will abandon or consent to the abandonment of, any oil or gas well constituting Collateral so long as such well is capable (or is subject to being made capable through drilling,
reworking or other operations which it would be commercially feasible to conduct) of producing oil, gas, or other hydrocarbons or other minerals in commercial quantities (as determined without
considering the effect of any Mortgage). No Loan Party will elect not to participate in a proposed operation on any oil and gas property constituting Collateral where the effect of such election would
be the forfeiture either temporarily (e.g., until a certain sum of money is received out of the forfeited interest) or permanently of any interest in the Collateral. 


        7.06    Restricted Payments.    Declare or make, directly or indirectly, any Restricted Payment, or incur any
obligation (contingent or otherwise) to do so, or issue or sell any Equity Interests, except 


52







 



that,
so long as no Default shall have occurred and be continuing at the time of any action described below or would result therefrom: 


        (a)   Each
Subsidiary may make Restricted Payments to Borrower and any other Person that owns an Equity Interest in such Subsidiary, ratably according to their respective
holdings of the type of Equity Interest in respect of which such Restricted Payment is being made; 


        (b)   Borrower
and each Subsidiary may purchase, redeem or otherwise acquire Equity Interests issued by it with the proceeds received from the substantially concurrent issue
of new shares of its common stock or other common Equity Interests; 


        (c)   Borrower
may make Permitted Tax Distributions; and 


        (d)   Borrower
may assume and pay the obligations of VAP-I, LLC under the Existing Credit Agreement pursuant to the Assignment, Assumption and Mortgage Amendment
on the Closing Date 


        (e)   For
the sole purpose of recording the satisfaction of Payout No. 1 and Payout No. 2 conditions under the terms of the existing limited partnership
agreement of the Borrower, and to establish the right of the General Partner to receive 50% of distributions thereunder, Borrower may book, as a distribution to the General Partner, such amount as is
equal to the General Partner's equivalent share of Borrowers debt assumption and payment allowed in Subsection (d) above, provided that Borrower simultaneously books, as capital contributions
made to Borrower's capital by the General Partner and VAP-I, LLC (50% from each), the amount booked as having been distributed, and provided, further, no cash or property is actually
distributed and Borrower's net equity is unaffected by the net effect of such simultaneous book entries. 


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


        7.08    Transactions with Affiliates.    Enter into any transaction of any kind with any Affiliate of Borrower,
whether or not in the ordinary course of business, other than on fair and reasonable terms substantially as favorable to Borrower or such Subsidiary as would be obtainable by Borrower or such
Subsidiary at the time in a comparable arm's length transaction with a Person other than an Affiliate, provided that the foregoing restriction shall not apply to transactions between or among Borrower
and any Guarantor or between and among Guarantors. 


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


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


        7.11    Hedging Contracts.    No Loan Party will be a party to or in any manner be liable on any Swap Contract except: 



        (a)   Swap
Contracts existing on the date hereof. 


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        (b)   Swap
Contracts entered into with the purpose and effect of fixing prices on Projected Oil and Gas Production for production expected to be produced no more than
36 months in the future that does not in the aggregate exceed ninety five percent (95%) of the aggregate Projected Oil and Gas Production for such period; provided that the aggregate production
covered by all such contracts for any single month does not in the aggregate exceed ninety five percent (95%) of the aggregate Projected Oil and Gas Production anticipated to be sold in the ordinary
course of the Loan Parties' businesses for such month. 


        (c)   Except
for Letters of Credit and the Collateral under the Security Documents with respect to Swap Obligations owing to Lenders, no Swap Contract shall require any Loan
Party to put up money, assets, or other security against the event of its nonperformance prior to actual default by such Loan Party in performing its obligations thereunder except for Swap Contracts
entered into prior to the date hereof, and each such contract (except for contracts with SemCrude, L.P. entered prior to the date hereof) is with a counterparty or has a guarantor of the obligation of
the counterparty who (unless such counterparty is a Lender or one of its Affiliates) at the time the contract is made has long-term obligations rated AA or Aa2 or better, respectively, by
either Rating Agency. 


        (d)   Contracts
entered into by a Loan Party with the purpose and effect of fixing interest rates on a principal amount of indebtedness of such Loan Party that is accruing
interest at a variable rate, provided that (i) at the time such Hedging Contract is entered into, the aggregate notional amount of such contracts does not exceed fifty percent (50%) of the
anticipated outstanding principal balance of the indebtedness to be hedged by such contracts or an average of such principal balances calculated using a generally accepted method of matching interest
swap contracts to declining principal balances, (ii) the floating rate index of each such contract generally matches the index used to determine the floating rates of interest on the
corresponding indebtedness to be hedged by such contract and (iii) each such contract is with a counterparty or has a guarantor of the obligation of the counterparty who (unless such
counterparty is a Lender or one of its Affiliates) at the time the contract is made has long-term obligations rated AA or Aa2 or better, respectively, by either Rating Agency. 




        7.12    Financial Covenants.    



        (a)    Current Ratio.    Borrower will not permit the ratio of its consolidated current assets plus the amount of its
Unused Borrowing Base to its consolidated current liabilities (excluding current maturities of the Loans and excluding current liabilities resulting from any mark to market under SFAS 133) to
be less than 1.0 to 1.0. 


        (b)    Interest Coverage Ratio.    Borrower will not permit the Interest Coverage Ratio to be less than 2.50 to 1.0,
calculated as of the end of each Fiscal Quarter. 



        (c)    Minimum Unused Borrowing Base.    During the period on and after the Closing Date to through the Maturity Date,
Borrower will not permit the Unused Borrowing Base to be less than $5,000,000. 


 
 

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.    Borrower or any other Loan Party fails to pay (i) when and as required to be
paid herein any Loan or any L/C Obligation, or (ii) within three (3) Business Days after the same becomes due, any interest on any Loan or on any L/C Obligation, or any fee due
hereunder, or (iii) within three (3) days after the same becomes due, any other amount payable hereunder or under any other Loan Document; or 


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        (b)    Specific Covenants.    Borrower fails to perform or observe any term, covenant or agreement contained in any of  Section 6.03, 6.05, 6.10,  6.11, 6.12, 6.13, 6.14,  6.15or 6.16 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 or any default or Event of Default occurs under
any other Loan Document; or 


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


        (e)    Cross-Default.    (i) 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 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 Borrower or any Subsidiary is an Affected Party (as so defined) and, in either event, the Swap Termination Value
owed by 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, rehabilitator or similar officer for it or for all or any material part of its property; or any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar
officer is appointed without the application or consent of such Person and the appointment continues undischarged or unstayed for 60 calendar days; or any proceeding under any Debtor Relief Law
relating to any such Person or to all or any material part of its property is instituted without the consent of such Person and continues undismissed or unstayed for 60 calendar days, or an order for
relief is entered in any such proceeding; or 


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


        (h)    Judgments.    There is entered against Borrower or any Subsidiary (i) a final judgment or order for the
payment of money in an aggregate amount exceeding the Threshold Amount (to the extent not covered by independent third-party insurance as to which the insurer does not dispute 


55







 



coverage),
or (ii) any one or more non-monetary final judgments that have, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect and,
in either case, (A) enforcement proceedings are commenced by any creditor upon such judgment or order, or (B) there is a period of 10 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 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) 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 or any provision thereof, 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 provision thereof; 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 any provision thereof; or 


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


        (l)    Material Adverse Effect.    There occurs any event of circumstance that has a Material Adverse Effect. 



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


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


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


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


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


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


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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 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 Agent (including fees and time charges for attorneys who may be employees of Agent) and amounts payable under  Article III) payable to Agent in its capacity as such;



        Second, to payment of that portion of the Obligations constituting fees, indemnities and other amounts (other than principal interest and
L/C Fees) payable to Lenders and the L/C Issuer (including fees, charges and disbursements of counsel to the respective Lenders and the L/C Issuer (including fees and time charges for attorneys who
may be employees of any Lender or the L/C Issuer) and amounts payable under Article III), ratably among them in proportion to the respective
amounts described in this clause Second payable to them; 


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



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


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


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




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


 
 

ARTICLE IX. ADMINISTRATIVE AGENT    
    


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


        9.02    Rights as a Lender.    The Person serving as 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 Agent and the term "Lender" or "Lenders" shall, unless otherwise expressly indicated or unless the context
otherwise requires, include the Person serving as 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 Agent hereunder and without any
duty to account therefor to Lenders. 


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        9.03    Exculpatory Provisions.    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, 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 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 Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may
expose 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 Borrower or any of its Affiliates that is communicated to or obtained by the Person serving as Agent or any of its Affiliates in any capacity. 


        (d)   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 Agent shall believe in good faith shall be necessary, under the circumstances as provided in  Sections 8.02 and 10.01) or (ii) in the absence of its own gross negligence or willful
misconduct. Agent shall be deemed not to have knowledge of any Default unless and until written notice describing such Default is given to Agent by Borrower, a Lender or the L/C Issuer. 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 Agent. 


        9.04    Reliance by Administrative Agent.    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. 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
the L/C Issuer, Agent may presume that such condition is satisfactory to such Lender or the L/C Issuer unless Agent shall have received notice to the contrary from such Lender or the L/C Issuer prior
to the making of such Loan or the issuance of such Letter of Credit. Agent may consult with legal counsel (who may be counsel for 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.    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 Agent. Agent and any such sub agent may perform any and all of its duties and exercise 


58







 



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 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 Agent. 



        9.06    Resignation of Agent.    Agent may at any time give notice of its resignation to Lenders, the L/C Issuer and
Borrower. Upon receipt of any such notice of resignation, the Required Lenders shall have the right, in consultation with Borrower, to appoint a successor, which shall be a bank with an office in the
United States, or an Affiliate of any such bank with an office in the United States. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment
within 30 days after the retiring Agent gives notice of its resignation, then the retiring Agent may on behalf of Lenders and the L/C Issuer, appoint a successor Agent meeting the
qualifications set forth above; provided that if 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 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 Agent on behalf of the Lenders or the L/C Issuer under any of the Loan Documents, the retiring Agent shall
continue to hold such collateral security until such time as a successor Agent is appointed) and (2) all payments, communications and determinations provided to be made by, to or through Agent
shall instead be made by or to each Lender and the L/C Issuer directly, until such time as the Required Lenders appoint a successor Agent as provided for above in this Section. Upon the acceptance of
a successor's appointment as Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or retired) Agent, and the
retiring 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 Borrower to a successor Agent shall be the same as those payable to its predecessor unless otherwise agreed between Borrower and such successor. After the retiring 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 Agent, its sub agents and their
respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Administrative Agent was acting as Administrative Agent. 


        Any
resignation by Bank of America as Agent pursuant to this Section shall also constitute its resignation as L/C Issuer and Swing Line Lender. Upon the acceptance of a
successor's appointment as 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 arrangements satisfactory to the retiring
L/C Issuer to effectively assume the obligations of the retiring L/C Issuer with respect to such Letters of Credit. 


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


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        9.08    No Other Duties, Etc.    Anything herein to the contrary notwithstanding, no Lender holding a title 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 Agent, a Lender or the L/C
Issuer hereunder. 


        9.09    Administrative Agent May File Proofs of Claim.    In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to any Loan Party, 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 Agent shall have made any demand on 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 Lenders, the L/C Issuer and Agent (including any claim for the reasonable
compensation, expenses, disbursements and advances of Lenders, the L/C Issuer and Agent and their respective agents and counsel and all other amounts due Lenders, the L/C Issuer and 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 the L/C Issuer to make such
payments to Agent and, in the event that Agent shall consent to the making of such payments directly to Lenders and the L/C Issuer, to pay to Agent any amount due for the reasonable compensation,
expenses, disbursements and advances of Agent and its agents and counsel, and any other amounts due Agent under Sections 2.09 and  10.04. Nothing
contained herein shall be deemed to authorize Agent to authorize or consent to or accept or adopt on behalf of any Lender or the L/C
Issuer any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or to authorize Agent to vote in respect of the claim of any Lender in
any such proceeding. 


        9.10    Guaranty Matters.    Each Lender and the L/C Issuer hereby irrevocably authorizes 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. Upon request by Agent at any
time, each Lender and the L/C Issuer will confirm in writing Agent's authority to enter into the transactions described in this Section 9.10. 



        9.11    Collateral Matters.    (a) Each Lender and the L/C Issuer hereby irrevocably authorizes and directs
Agent to enter into the Collateral Documents for the benefit of such Lender and the L/C Issuer. Each Lender and the L/C Issuer hereby agrees, and each holder of any Note by the acceptance thereof will
be deemed to agree, that, except as otherwise set forth in Section 10.01, any action taken by the Required Lenders, in accordance with the
provisions of this Agreement or the Collateral Documents, and the exercise by the Required Lenders of the powers set forth herein or therein, together with such other powers as are reasonably
incidental thereto, shall be authorized and binding upon all of Lenders and the L/C Issuer. Agent is hereby authorized (but not obligated) on behalf of all of Lenders and the L/C Issuer, without the
necessity of any notice to or further consent from any Lender or the L/C Issuer from time to time prior to, an Event of Default, to take any action with respect to any Collateral or Collateral
Documents which may be necessary to perfect and maintain perfected the Liens upon the Collateral granted pursuant to the Collateral Documents. 


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        (b)   Each
Lender and the L/C issuer hereby irrevocably authorize Agent, at its option and in its discretion, 



          (i)  to
release any Lien on any property granted to or held by Agent under any Loan Document (A) upon termination of the Aggregate Commitments and payment in full of
all Obligations (other than contingent indemnification obligations) and the expiration or termination of all Letters of Credit, (B) that is sold or to be sold as part of or in connection with
any sale permitted hereunder or under any other Loan Document, (C) subject to Section 10.01, if approved, authorized or ratified in
writing by the Required Lenders, or (D) in connection with any foreclosure sale or other disposition of Collateral after the occurrence of an Event of Default; and 


         (ii)  to
subordinate any Lien on any property granted to or held by Agent under any Loan Document to the holder of any Lien on such property that is permitted by this
Agreement or any other Loan Document. 




Upon
request by Agent at any time, each Lender and the L/C Issuer will confirm in writing Agent's authority to release or subordinate its interest in particular types or items of Collateral pursuant
to this Section 9.11. 



        (c)   Subject
to (b) above, Agent shall (and is hereby irrevocably authorized by each Lender and the L/C Issuer, to execute such documents as may be necessary to
evidence the release or subordination of the Liens granted to Agent for the benefit of Agent and Lenders and the L/C Issuer herein or pursuant hereto upon the applicable Collateral; provided that
(i) Agent shall not be required to execute any such document on terms which, in Agent's opinion, would expose Agent to or create any liability or entail any consequence other than the release
or subordination of such Liens without recourse or warranty and (ii) such release or subordination shall not in any manner discharge, affect or impair the Obligations or any Liens upon (or
obligations of Borrower or any other Loan Party in respect of) all interests retained by Borrower or any other Loan Party, including the proceeds of the sale, all of which shall continue to constitute
part of the Collateral. In the event of any sale or transfer of Collateral, or any foreclosure with respect to any of the Collateral, Agent shall be authorized to deduct all expenses reasonably
incurred by Agent from the proceeds of any such sale, transfer or foreclosure. 


        (d)   Agent
shall have no obligation whatsoever to any Lender, the L/C Issuer or any other Person to assure that the Collateral exists or is owned by Borrower or any other
Loan Party or is cared for, protected or insured or that the Liens granted to Agent herein or in any of the Collateral Documents or pursuant hereto or thereto have been properly or sufficiently or
lawfully created, perfected, protected or enforced or are entitled to any particular priority, or to exercise or to continue exercising at all or in any manner or under any duty of care, disclosure or
fidelity any of the rights, authorities and powers granted or available to Agent in this Section 9.11 or in any of the Collateral Documents, it
being understood and agreed that in respect of the Collateral, or any act, omission or event related thereto, Agent may act in any manner it may deem appropriate, in its sole discretion, given Agent's
own interest in the Collateral as one of Lenders and that Agent shall have no duty or liability whatsoever to Lenders or the L/C Issuer. 


        (e)   Each
Lender and the L/C Issuer hereby appoints each other Lender as agent for the purpose of perfecting Lenders' and the L/C Issuer's security interest in assets which,
in accordance with Article 9 of the UCC can be perfected only by possession. Should any Lender or the L/C Issuer (other than Agent) obtain possession of any such Collateral, such Lender or the
L/C Issuer shall notify Agent thereof, and, promptly upon Agent's request therefor shall deliver such Collateral to Agent or in accordance with Agent's instructions. 


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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 Borrower or any other Loan Party therefrom, shall be effective unless in writing signed by the Required Lenders and Borrower or the applicable Loan Party, as the case
may be, and acknowledged by 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;  provided, however, in the sole discretion of Agent, only a waiver by Agent shall be required with
respect to immaterial matters or items specified in Section 4.01(a) (iii) or (iv) with respect to
which Borrower has given assurances satisfactory to Agent that such items shall be delivered promptly following the Closing Date; 



        (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 (excluding mandatory prepayments) of principal, interest, fees or other amounts due
to 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 Borrower to pay interest or L/C Fees at the Default Rate; 


        (e)   amend
Section 7.12 (or any defined term used therein) without the written consent of each Lender; 


        (f)    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; 


        (g)   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 


        (h)   release
any Guarantor from the Guaranty or release the Liens on all or substantially all of the Collateral in any transaction or series of related transactions except in
accordance with the terms of any Loan Document, without the written consent of each Lender; 


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


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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 Communications.    


        (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 Borrower, Agent, the L/C Issuer or Swing Line Lender, to the address, telecopier number, electronic mail address or telephone number specified for such Person on  Schedule 4; 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 Lenders and the L/C Issuer hereunder may be
delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by Agent, provided that the foregoing shall not
apply to notices to any Lender or the L/C Issuer pursuant to Article II if such Lender or the L/C Issuer, as applicable has notified the Agent that it is incapable of receiving notices under
such Article by electronic communication. Agent or 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 Agent otherwise prescribes, (i) notices and other communications sent to
an e-mail address shall be deemed received upon the sender's receipt of an acknowledgement from the intended recipient (such as by the "return receipt requested" function, as available,
return e-mail or other written acknowledgement), provided that if such notice or other communication is not sent during the normal business
hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient, and (ii) notices or communications
posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (i)
of notification that such notice or communication is available and identifying the website address therefor. 


        (c)    The Platform.    THE PLATFORM IS PROVIDED "AS IS" AND "AS AVAILABLE." THE AGENT PARTIES (AS DEFINED BELOW) DO
NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS. NO WARRANTY
OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR
OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM. In no event shall Agent or any of its Related Parties (collectively, the
"Agent Parties") have any liability to Borrower, any Lender, the L/C Issuer or any other Person for losses, claims, damages, liabilities or expenses of
any 


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kind
(whether in tort, contract or otherwise) arising out of Borrower's or Agent's transmission of Borrower Materials through the Internet, except to the extent that such losses, claims, damages,
liabilities or expenses are determined by a court of competent jurisdiction by a final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Agent Party;
provided, however, that in no event shall any Agent Party have any liability to Borrower, any Lender, the L/C Issuer or any other Person for indirect, special, incidental, consequential or punitive
damages (as opposed to direct or actual damages). 


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


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


        10.03    No Waiver; Cumulative Remedies.    No failure by any Lender, the L/C Issuer or 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.    Borrower shall pay (i) all reasonable out of pocket expenses incurred by Agent
and its Affiliates (including the reasonable fees, charges and disbursements of counsel for Agent), in connection with the syndication of the credit facilities provided for herein, the preparation,
negotiation, execution, delivery and administration of this Agreement and the other Loan Documents or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the
transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable out of pocket expenses incurred by the L/C Issuer in connection with the issuance, amendment, renewal or
extension of any Letter of Credit or any demand for payment thereunder and (iii) all out of pocket expenses incurred by Agent, any Lender or the L/C Issuer (including the fees, charges and
disbursements of any counsel for Agent, any Lender or the L/C Issuer), and shall pay all fees and time charges for attorneys who may be employees of Agent, any Lender or the L/C Issuer, in connection
with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents, including its rights under this Section, or (B) in connection with
the Loans made or Letters of Credit issued hereunder, including all such out of pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of
Credit. 


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        (b)    Indemnification by the Borrower.    Borrower shall indemnify Agent (and any sub-agent thereof),
each Lender and the L/C Issuer, and each Related Party of any of the foregoing Persons (each such Person being called an "Indemnitee") against, and hold
each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses (including the fees, charges and disbursements of any counsel for any Indemnitee), and shall
indemnify and hold harmless each Indemnitee from all fees and time charges and disbursements for attorneys who may be employees of any Indemnitee, incurred by any Indemnitee or asserted against any
Indemnitee by any third party or by Borrower or any other Loan Party arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan
Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder, or the consummation of the
transactions contemplated hereby or thereby, or, in the case of Agent (and any sub-agent thereof) and its Related Parties only, the administration of this Agreement and the other Loan
Documents, (ii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by the L/C Issuer to honor a demand for payment under a Letter of Credit
if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or release of Hazardous Materials
on or from any property owned or operated by the Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its Subsidiaries, or (iv) any
actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by the
Borrower or any other Loan Party, and regardless of whether any Indemnitee
is a party thereto, in all cases, whether or not caused by or arising, in whole or in part, out of the comparative, contributory or sole negligence of the Indemnitee;  provided that such indemnity shall
not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related
expenses (x) are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee or
(y) result from a claim brought by Borrower or any other Loan Party against an Indemnitee for breach in bad faith of such Indemnitee's obligations hereunder or under any other Loan Document, if
Borrower or such Loan Party has obtained a final and nonappealable judgment in its favor on such claim as determined by a court of competent jurisdiction. 


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


        (d)    Waiver of Consequential Damages, Etc.    To the fullest extent permitted by applicable law, 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. 


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        (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 Agent and the L/C Issuer, the
replacement of any Lender, the termination of the Aggregate Commitments and the repayment, satisfaction or discharge of all the other Obligations. 


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


        10.06    Successors and Assigns.    


        (a)    Successors and Assigns Generally.    The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns permitted hereby, except that neither Borrower nor any other Loan Party may assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of Agent, the L/C Issuer 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, or (iii) by way of pledge or assignment of a security interest subject to the restrictions of subsection (f) 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 Agent, the L/C Issuer 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 and in
Swing Line Loans) 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, 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 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 Agent and, so long as no Event of Default has occurred and is continuing, 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 


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under
this Agreement with respect to the Loans or the Commitment assigned, except that this clause (ii) shall not apply to rights in respect of Swing Line Loans; (iii) any assignment of
a Commitment must be approved by Agent, the L/C Issuer and Swing Line Lender 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 Agent an Assignment and Assumption, together with a processing and recordation fee of
$3,500 and the Eligible Assignee, if it shall not be a Lender, shall deliver to Agent an Administrative Questionnaire. Subject to acceptance and recording thereof by 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, 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.    Agent, acting solely for this purpose as an agent of Borrower, shall maintain at Administrative
Agent's Office a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts of
the Loans and L/C Obligations owing to, each Lender pursuant to the terms hereof from time to time (the "Register"). The entries in the Register shall
be conclusive, and Borrower, 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 Borrower and the L/C Issuer, at any reasonable time and from time to time upon reasonable prior
notice. In addition, at any time that a
request for a consent for a material or substantive change to the Loan Documents is pending, any Lender may request and receive from Agent a copy of the Register. 



        (d)    Participations.    Any Lender may at any time, without the consent of, or notice to, Borrower or Agent, sell
participations to any Person (other than a natural person or Borrower or any of 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
and/or Swing Line Loans) 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) Borrower, Agent, the L/C Issuer and the Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement;  provided that such agreement
or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, waiver
or other modification described in the first proviso to Section 10.01 that affects such Participant. Subject to subsection (e) of this
Section, 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 


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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 Borrower's prior written consent. 



        (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)    Deemed Consent of Borrower.    If the consent of Borrower to an assignment to an Eligible Assignee is required
hereunder (including a consent to an assignment which does not meet the minimum assignment threshold specified in clause (i) of the proviso to the first sentence of  Section 10.06(b)), Borrower
shall be deemed to have given its consent five Business Days after the date notice thereof has been delivered to
Borrower by the assigning Lender (through Agent) unless such consent is expressly refused by Borrower prior to such fifth Business Day. 


        (i)    Resignation as L/C Issuer or Swing Line Lender.    Notwithstanding anything to the contrary contained herein,
if at any time Bank of America assigns all of its Commitment and Loans pursuant to subsection (b) above, Bank of America may, (i) upon 30 days' notice to Borrower and the Lenders,
resign as L/C Issuer and/or (ii) upon 30 days' notice to Borrower, resign as Swing Line Lender. In the event of any such resignation as L/C Issuer or Swing Line Lender, Borrower shall be
entitled to appoint from among Lenders a successor L/C Issuer or Swing Line Lender hereunder; provided,  however, that no failure by Borrower to appoint any
such successor shall affect the resignation of Bank of America as L/C Issuer or Swing Line Lender,
as the case may be. If Bank of America resigns as L/C Issuer, it shall retain all the rights, powers, privileges and duties of the L/C Issuer hereunder with respect to all Letters of Credit
outstanding as of the effective date of its resignation as L/C Issuer and all L/C Obligations with respect thereto (including the right to require the Lenders to make Base Rate Committed Loans or fund
risk participations in Unreimbursed Amounts pursuant to Section 2.03(c)). If Bank of America resigns as Swing Line Lender, it shall retain all
the rights of Swing Line Lender provided for hereunder with respect to Swing Line Loans made by it and outstanding as of the effective date of such resignation, including the right to require the
Lenders to make Base Rate Committed Loans or fund risk participations in outstanding Swing Line Loans pursuant to Section 2.04(c). Upon the
appointment of a successor L/C Issuer and/or Swing Line Lender, (a) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring L/C
Issuer or Swing Line Lender, as the case may be, and (b) the successor L/C Issuer shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of
such succession or make other arrangements satisfactory to Bank of America to effectively assume the obligations of Bank of America with respect to such Letters of Credit. 


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        10.07    Treatment of Certain Information; Confidentiality.    Each of Agent, Lenders and the L/C Issuer agrees to
maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and to its and its Affiliates' respective partners, directors,
officers, employees, agents, advisors and representatives (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential), (b) to the extent requested by any regulatory authority, purporting to have jurisdiction over it (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (d) to
any other party hereto, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding
relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of
this Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement or (ii) any actual or
prospective counterparty (or its advisors) to any swap or derivative transaction relating to Borrower and its obligations, (g) with the consent of Borrower or (h) to the extent such
Information (x) becomes publicly available other than as a result of a breach of this Section or (y) becomes available to Agent, any Lender, the L/C Issuer or any of their respective
Affiliates on a nonconfidential basis from a source other than Borrower. For purposes of this Section, "Information" means all information received from
Borrower or any Subsidiary relating to Borrower or any Subsidiary or any of their respective businesses, other than any such information that is available to Agent, any Lender or the L/C Issuer on a
nonconfidential basis prior to disclosure by Borrower or any Subsidiary, provided that, in the case of information received from Borrower or any
Subsidiary after the date hereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this
Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would
accord to its own confidential information. Each of Agent, the Lenders and the L/C Issuer acknowledges that (a) the Information may include material non-public information
concerning the Borrower or a Subsidiary, as the case may be, (b) it has developed compliance procedures regarding the use of material non-public information and (c) it will
handle such material non-public information in accordance with applicable Law, including Federal and state securities Laws. 


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


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        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 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 Borrower. In determining whether the interest contracted for, charged, or received
by 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. 



        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 Agent and
when 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 Agent and each Lender, regardless of any investigation made by Agent or any Lender or on their behalf and notwithstanding that 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    Replacement of Lenders.    If any Lender requests compensation under  Section 3.04, or if the Borrower is required
to pay any additional amount to any Lender or any Governmental Authority for the account of any
Lender pursuant to Section 3.01, or if any Lender is a Defaulting Lender, or if any Lender fails to agree to upon a proposed Borrowing Base
pursuant to Section 2.15 that is the same as or is a decrease of the then existing Borrowing Base if Lenders constituting the Required Lenders
have agreed to such proposed Borrowing Base, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate,
without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 10.06), all of its
interests, rights and obligations under this Agreement and the related Loan Documents to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such
assignment), provided that: (a) the Borrower shall have paid to the Administrative Agent the assignment fee specified in  Section 10.06;
(b) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and L/C Advances,
accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts under  Section 3.05) from the assignee (to the extent
of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all
other amounts); (c) in the case of any such assignment resulting from a claim for compensation under Section 3.04 or payments required to
be made pursuant to Section 3.01, such assignment will result in a reduction in such compensation or payments thereafter; and (d) such
assignment does not conflict with applicable Laws. 


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


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


        10.14    Governing Law; Jurisdiction; Etc.    



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


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


        (c)    WAIVER OF VENUE.    THE 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. 


71







 



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


        10.16    USA PATRIOT Act Notice.    Each Lender that is subject to the Act (as hereinafter defined) and Agent (for
itself and not on behalf of any Lender) hereby notifies 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 Borrower, which information includes the name and address of Borrower and other information that will allow
such Lender or Agent, as applicable, to identify Borrower in accordance with the Act. 


        10.17    Time of the Essence.    Time is of the essence of the Loan Documents. 


        10.18    Restatement.    Effective as of the Closing Date, (a) each lender consents to the execution and
acceptance by Agent on its behalf of the Assignment, Assumption and Amendment (b) this Agreement amends and restates the Existing Credit Agreement in its entirety, and (c) the loans and
all other obligations outstanding under the Existing Credit Agreement shall be outstanding under and governed by this Agreement. 


[The
remainder of this page is intentionally left blank.] 


72








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



	 	 	MV PARTNERS, L.P.
	

 	
 	

By:	

MV Energy, LLC, its General Partner
	

 	
 	

 	

By:	

Murfin Drilling Company, Inc., as Member
	

 	
 	

By:	

/s/  ROBERT D. YOUNG      
	 	 	 	
 Robert D. Young

Treasurer











	 	 	BANK OF AMERICA, N.A., as Administrative Agent
	

 	
 	

By:	

/s/  TODD G. MACNEILL      
	 	 	 	
 Name: Todd G. MacNeill

Title: Assistant Vice President
	

 	
 	
BANK OF AMERICA, N.A., as a Lender, L/C Issuer and Swing Line Lender
	

 	
 	

By:	

/s/  GREGORY B. HANSON      
	 	 	 	
 Name: Gregory B. Hanson

Title: Vice President











	 	 	UNION BANK OF CALIFORNIA, N.A.
	

 	
 	

By:	

/s/  RANDALL OSTERBERG      
	 	 	 	
 Name: Randall Osterberg

Title: Senior Vice President
	

 	
 	

By:	

/s/  ALI AHMED      
	 	 	 	
 Name: Ali Ahmed

Title: Vice President











	 	 	GENERAL ELECTRIC CAPITAL CORPORATION
	

 	
 	

By:	

/s/  SIMON R. DUNCAN      
	 	 	 	
 Name: Simon R. Duncan

Title: Authorized Signatory










SCHEDULE 1  


APPLICABLE PERCENTAGES,

MAXIMUM CREDIT AMOUNT AND

INITIAL BORROWING BASE  



	Lender
 
	 	Maximum

Credit

Amount
	 	Initial

Borrowing

Base
	 	Applicable

Percentage
	 
	Bank of America, N.A.	 	$	67,368,420	 	$	32,000,000	 	33.684210000	%
	General Electric Capital Corporation	 	$	66,315,790	 	$	31,500,000	 	33.157895000	%
	Union Bank of California	 	$	66,315,790	 	$	31,500,000	 	33.157895000	%
	Total	 	$	200,000,000	 	$	95,000,000	 	100.000000000	%









SCHEDULE 2  


SECURITY
DOCUMENTS 


	1.
	Deed
of Trust, Mortgage, Assignment, Security Agreement, Fixture Filing and Financing Statement dated September 30, 2005 from Borrower in favor of General Electric Capital
Corporation.



	2.
	Assignment
of Notes and Liens, Assumption, and First Amendment to Mortgage, Assignment, Security Agreement, Fixture Filing and Financing Statement to be dated as of the Closing Date
from MV Partners, L.P., Mortgagor, VAP-I, LLC, Limited Partner and General Electric Capital Corporation, Assignor to Bank of America, N.A., Agent and Assignee. 







SCHEDULE 3  


DISCLOSURE SCHEDULE  


Litigation:



None



Subsidiaries
and other Equity Investments: 


None



Existing
Liens: 


None



Existing
Indebtedness: 


None 


Sale
of Production (Section 5.18):

MV Partners, L.P. has agreed to sell it's crude oil production where practicable at market competitive rates to SemGroup affiliates during the duration of the hedges reflected on the attached
confirmation. 







SCHEDULE 4  


ADMINISTRATIVE AGENT'S OFFICE,

CERTAIN ADDRESSES FOR NOTICES  


BORROWER:  


MV
Partners, L.P.

250 N. Water, Suite 300

Wichita, Kansas 67202 


Attention:
Bob Young

Telephone: (316) 267-3241

Telecopier: (316) 267-6004

Electronic Mail: byoung@murfininc.com

Website Address: none 


OFFICE OF ADMINISTRATIVE AGENT AND SWING LINE LENDER  



	Notices (other than Requests for Extensions of Credit):
	Att:	Todd Mac Neill

Agency Officer

Bank of America, N.A.

100 Federal Street

Boston, MA 02110
	Tel: (617) 434-6842
	Facsimile: (617) 790-1361
	Electronic Mail: todd.g.macneill@Bank of America.com





For
Payments and Requests for Extensions of Credit:
 BANK OF AMERICA, N.A.

Att: Jackie Harvey

Tel: (214) 209-2158

Facsimile: (214) 290-9671

Electronic Mail: 


Payments:

BANK OF AMERICA, N.A.

901 Main Street, 14th Floor

Dallas, Texas 75202

ABA No. 111000012

Account No: 1292000883

Account Name:

Attn: Credit Services, Jackie Harvey

Reference: MV Partners, L.P. 


L/C ISSUER:
Letters of Credit:

Attn: Mike Evans

Bank of America, N.A.

Trade Operations — Scranton

1 Fleet Way

Mail Code: PA6-580-02-30

Scranton, PA 18507

Telephone: (570) 330-4244 








  



EXHIBIT A  


  
 

    FORM OF COMMITTED LOAN NOTICE    
    


        Date:                        ,
            



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




Ladies
and Gentlemen: 


        Reference
is made to that certain Credit Agreement, dated as of [                        ,
            ] (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 MV Partners,
L.P., an Kansas limited partnership (the "Borrower"), the Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent,
L/C Issuer and Swing Line Lender. 


        The
undersigned hereby requests (select one): 


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



	1.
	On                        (a
Business Day).



	2.
	In
the amount of $                        .



	3.
	Comprised
of                        .

                             [Type of Committed Loan requested]



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




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




	 	 	MV PARTNERS, L.P.
	

 	
 	
By:	
 	

MV Energy, LLC, its General Partner
	

 	
 	

 	
 	

By:	

Murfin Drilling Company, Inc., as Member
	

 	
 	

By:	
 	




	 	 	 	 	
 Robert D. Young

Treasurer




A-1








  



EXHIBIT B  


  
 

    FORM OF SWING LINE LOAN NOTICE    
    


        Date:                        ,
            


	To:
	Bank
of America, N.A., as Swing Line Lender

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



Ladies
and Gentlemen: 


        Reference
is made to that certain Credit Agreement, dated as of [                        ,
            ] (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 MV Partners,
L.P., an Kansas limited partnership (the "Borrower"), the Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent,
L/C Issuer and Swing Line Lender. 


        The
undersigned hereby requests a Swing Line Loan: 



	1.
	On                        (a
Business Day).



	2.
	In
the amount of $                        . 




        The
Swing Line Borrowing requested herein complies with the requirements of the provisos to the first sentence of Section 2.04(a)
of the Agreement. 



	 	 	MV PARTNERS, L.P.
	

 	
 	
By:	
 	

MV Energy, LLC, its General Partner
	

 	
 	

 	
 	

By:	

Murfin Drilling Company, Inc., as Member
	

 	
 	

By:	
 	




	 	 	 	 	
 Robert D. Young

Treasurer




B-1








   EXHIBIT C  


FORM OF NOTE  



	$	 
	 	 	 	 






        FOR
VALUE RECEIVED, the undersigned ("Borrower"), hereby promises to pay
to                        or registered assigns
("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 Borrower under that certain Credit Agreement, dated as of [                        ,
            ] (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 Borrower, the Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender. 


        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. Except as otherwise provided in Section 2.04(f) of the Agreement with respect to Swing Line Loans, all
payments of principal and interest shall be made to 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. Upon the occurrence and continuation of one or more of the Events of Default specified in the Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared to be,
immediately due and payable all as provided in the Agreement. Loans made by the Lender shall be evidenced by one or more loan accounts or records maintained by the Lender in the ordinary course of
business. The Lender may also attach schedules to this Note and endorse thereon the date, amount and maturity of its Loans and payments with respect thereto. 


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


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



	 	 	MV PARTNERS, L.P.
	

 	
 	

By:	
 	

MV Energy, LLC, its General Partner
	

 	
 	

 	
 	

By:	
 	

Murfin Drilling Company, Inc., as Member
	

 	
 	

By:	
 	

 
 Robert D. Young

Treasurer




C-1







 
LOANS AND PAYMENTS WITH RESPECT THERETO  



	Date
 
	 	Type of

Loan Made
	 	Amount of

Loan Made
	 	End of

Interest

Period
	 	Amount of

Principal or

Interest

Paid This

Date
	 	Outstanding

Principal

Balance This

Date
	 	Notation

Made By

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 




C-2








   EXHIBIT D  


FORM OF COMPLIANCE CERTIFICATE  


Financial
Statement Date:                        


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



Ladies
and Gentlemen: 


        Reference
is made to that certain Credit Agreement, dated as of December 21, 2005 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time,
the "Agreement;" the terms defined therein being used herein as therein defined), among MV Partners, L.P., a Kansas limited partnership
("Borrower"), the Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender. 


        The
undersigned Responsible Officer hereby certifies as of the date hereof that he is the acting Treasurer of Murfin Drilling Company, Inc., a Kansas corporation, which is a
member of MV Energy, LLC, a Kansas limited liability company, which is the sole general partner of Borrower, and that, as such, he is authorized to execute and deliver this Certificate to Agent on the
behalf of Borrower, and that: 


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


        1.     Attached
hereto as Schedule 1 are the year-end audited financial statements required by  Section 6.01(a) of the Agreement for the fiscal year of Borrower
ended as of the above date, together with 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 as Schedule 1 are the unaudited financial statements required by  Section 6.01(b) of the Agreement for the fiscal quarter of Borrower ended
as of the above date. Such financial statements fairly present the
financial condition, results of operations and cash flows of 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 Borrower during the accounting period covered by the attached financial statements. 


        3.     A
review of the activities of Borrower during such fiscal period has been made under the supervision of the undersigned with a view to determining whether during such
fiscal period 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, Borrower performed and observed each covenant and condition of the Loan Documents
applicable to it, and no Default has occurred and is continuing.]


—or—  


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


D-1







 



        4.     The
representations and warranties of Borrower contained in Article V of the Agreement, and/or any representations
and warranties of Borrower or any other 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. 


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


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



	 	 	MV PARTNERS, L.P.
	

 	
 	

By:	

MV Energy, LLC, its General Partner
	

 	
 	

 	

By:	

Murfin Drilling Company, Inc., as Member
	

 	
 	

By:	

    
 Robert D. Young

Treasurer




D-2







 
For the Quarter/Year ended                        ("Reporting Date") 


SCHEDULE 2
  to the Compliance Certificate
 ($ in 000's)



	I.	 	Section 7.12(a)—Current Ratio	 	 
	

 	
 	

(A)	
 	

Consolidated current assets of Borrower as of Reporting Date:	
 	

$                  
	

 	
 	

(B)	
 	

Unused Borrowing Base:	
 	

 
	

 	
 	

 	
 	

1.	
 	

Borrowing Base as of the Reporting Date:	
 	

$                  
	

 	
 	

 	
 	

2.	
 	

Facility Usage:	
 	

 
	

 	
 	

 	
 	

 	
 	

a)	
 	

Outstanding Amount of Loans as of Reporting Date:	
 	

$                  
	

 	
 	

 	
 	

 	
 	

b)	
 	

Outstanding Amount of L/C Obligations as of Reporting Date:	
 	

$                  
	

 	
 	

 	
 	

 	
 	

c)	
 	

Facility Usage (Line I.B.2.a. + Line I.B.2.b.):	
 	

$                  
	

 	
 	

 	
 	

3.	
 	

Unused Borrowing Base as of Reporting Date (Line I.B.1 - Line I.B.2.c.):	
 	

$                  
	

 	
 	

(C)	
 	

Consolidated current liabilities of Borrower as of Reporting Date:	
 	

$                  
	

 	
 	

(D)	
 	

Current Ratio ((Line I.A. + Line I.B.3) ÷ Line I.C.)	
 	

                  to 1
	

 	
 	

(E)	
 	

Minimum required:	
 	

                  to 1 
	

II.	
 	

Section 7.12(b)—Interest Coverage Ratio.	
 	

 
	

 	
 	

(A)	
 	

Consolidated EBITDA of Borrower and its Subsidiaries for the four Fiscal Quarter period ending on the Reporting Date ("Subject Period"):	
 	

 
	

 	
 	

 	
 	

1.	
 	

Consolidated Net Income of Borrower and its Subsidiaries for Subject Period:	
 	

$                  




D-3







 


	 	 	 	 	2.	 	Consolidated Interest Charges for Subject Period* (Line II.B.3.):	 	$                  
	 	 	 	 	3.	 	Federal, state and local income taxes for Subject Period:*	 	$                  
	 	 	 	 	4.	 	Depreciation expenses for Subject Period:*	 	$                  
	 	 	 	 	5.	 	Amortization expenses for Subject Period:*	 	$                  
	 	 	 	 	6.	 	Depletion expenses for Subject Period:*	 	$                  
	 	 	 	 	7.	 	Other non-cash charges for Subject Period:*	 	$                  
	 	 	 	 	8.	 	Consolidated EBITDA (Lines II.A.1 + 2 + 3 + 4 + 5 + 6 + 7):	 	$                  
	 	 	(B)	 	Consolidated Interest Charges:	 	 
	 	 	 	 	1.	 	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 for Subject Period:	 	$                  
	 	 	 	 	2.	 	Portion of rent expense of the Borrower and its Subsidiaries under capital leases for Subject Period:	 	$                  
	 	 	 	 	3.	 	Consolidated Interest Charges (Line II.B.1. + Line II.B.2.)	 	$                  
	 	 	(C)	 	Interest Coverage Ratio (Line II.A.8 ÷ Line II.B.3):	 	                  to 1
	 	 	(D)	 	Minimum required:	 	                  to 1






	*
	include
only to the extent that it has been deducted in calculating Consolidated Net Income 


D-4







 
For the Fiscal Quarter/Year ended                        ("Reporting
Date") 


Quarterly Information for Schedule 2
  to the Compliance Certificate

($ in 000's) 


Consolidated EBITDA
  (in accordance with the definition of Consolidated EBITDA

as set forth in the Agreement) 



	Consolidated EBITDA
 
	 	Quarter Ended
	 	Quarter Ended
	 	Quarter Ended
	 	Quarter Ended
	 	Twelve Months Ended

	Consolidated Net Income of Borrower and its Subsidiaries	 	 	 	 	 	 	 	 	 	 
	

+ Consolidated Interest Charges	
 	

 	
 	

 	
 	

 	
 	

 	
 	

 
	

+ Federal, state and local income taxes	
 	

 	
 	

 	
 	

 	
 	

 	
 	

 
	

+ depreciation expense	
 	

 	
 	

 	
 	

 	
 	

 	
 	

 
	

+ amortization expense	
 	

 	
 	

 	
 	

 	
 	

 	
 	

 
	

+ depletion expense	
 	

 	
 	

 	
 	

 	
 	

 	
 	

 
	

+ other non-cash charges	
 	

 	
 	

 	
 	

 	
 	

 	
 	

 
	

= Consolidated EBITDA	
 	

 	
 	

 	
 	

 	
 	

 	
 	

 




D-5








  



EXHIBIT E  


 
 

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 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 and Swing Line Loans 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 


E-1







 



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 of [identify Lender]]
	 	 	 	
	 
	

3.	
 	

Borrower(s):	

 	

 
	 	 	 	
	 
	

4.	
 	

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

5.	
 	

Credit Agreement: [Credit Agreement, dated as of December            , 2005 among MV Partners, L.P.,
	an Kansas limited partnership, the Lenders from time to time party thereto, Bank of America, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender
	

6.	
 	

Assigned Interest:	

 





	Facility Assigned
	 	Aggregate Amount of Commitment/Loans for all Lenders*
	 	Amount of Commitment/Loans Assigned*
	 	Percentage Assigned of Commitment/Loans
	 	CUSIP No.
	 
	 	 	$	 	 	$	 	 	 	%	 	 
	 	 	$	 	 	$	 	 	 	%	 	 
	 	 	$	 	 	$	 	 	 	%	 	 




	[7.
	Trade Date:
                             ] 



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


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        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] Accepted:	

 
	

Bank of America, N. A., as

  Administrative Agent	

 
	

By:	

 	

 
	 	
	 





	Title:	 	 
	 	
	 
	
[Consented to:]	

 





	

By:	

 	

 
	 	
	 





	Title:	 	 
	 	
	 




E-3







 
 
 

ANNEX 1 TO ASSIGNMENT AND ASSUMPTION
  
    STANDARD TERMS AND CONDITIONS FOR
  ASSIGNMENT AND ASSUMPTION    
    


        1.    Representations and Warranties.    



        1.1.    Assignor.    The Assignor (a) represents and warrants that (i) it is the legal and beneficial
owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all
action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any
statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of 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 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, and (iv) it has received a copy of the Credit Agreement, together with copies of the most recent financial statements delivered pursuant to Section  [    ] thereof,
as applicable, and such other documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest on the basis of which it has made such analysis and decision independently and without
reliance on Agent or any other Lender; and (b) agrees that (i) it will, independently and without reliance on 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, Agent shall make all payments in respect of the Assigned
Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for amounts which
have accrued from and after the Effective Date. 


        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
                         [confirm that
choice of law provision parallels the Credit Agreement]. 


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EXHIBIT F  


 
 

OPINIONS OF COUNSEL TO LOAN PARTIES    
    









EXHIBIT G  


 
 

ASSIGNMENT, ASSUMPTION AND MORTGAGE AMENDMENT    
    











QuickLinks


TABLE OF CONTENTS


CREDIT AGREEMENT

ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS


ARTICLE II. THE COMMITMENTS AND CREDIT EXTENSIONS


ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY

ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

ARTICLE V. REPRESENTATIONS AND WARRANTIES


ARTICLE VI. AFFIRMATIVE COVENANTS


ARTICLE VII. NEGATIVE COVENANTS

ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES

ARTICLE IX. ADMINISTRATIVE AGENT


ARTICLE X. MISCELLANEOUS


FORM OF COMMITTED LOAN NOTICE


FORM OF SWING LINE LOAN NOTICE


FORM OF ASSIGNMENT AND ASSUMPTION

ANNEX 1 TO ASSIGNMENT AND ASSUMPTION STANDARD TERMS AND CONDITIONS FOR ASSIGNMENT AND ASSUMPTION



OPINIONS OF COUNSEL TO LOAN PARTIES



ASSIGNMENT, ASSUMPTION AND MORTGAGE AMENDMENT