Document:

Exhibit
10.3

December 18, 2006

To the Investors

Listed on the Signature Pages to the

Stock Purchase Agreement

dated December 18, 2006

Re: Lipid Sciences, Inc. – Private Placement 

Dear Investor:

We appreciate your interest in our private placement
of shares of common stock (the “Financing”).  This
letter confirms additional information regarding the Financing.  We understand that you and the other
investors will rely on this letter in connection with the purchase of
securities in the Financing.  Please note
that capitalized terms not defined in this letter have the meaning set forth in
the Stock Purchase Agreement to be entered into by you and the Company.

As of the Execution Date, the
Company confirms to you that:

There is no transaction,
arrangement, or other relationship between the Company and an unconsolidated or
other off balance sheet entity that is required to be disclosed by the Company
in its Exchange Act filings and is not so disclosed or that otherwise would be
reasonably likely to have a Material Adverse Effect.

The Company has not, and
to its knowledge no one acting on its behalf has, (i) taken, directly or
indirectly, any action designed to cause or to result in the stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of any of the Shares, (ii) except for consideration payable to the
Placement Agent, sold, bid for, purchased, or paid any compensation for
soliciting purchases of, any of the Shares, or (iii) except for consideration
payable to the Placement Agent, paid or agreed to pay to any person any
compensation for soliciting another to purchase any other securities of the
Company.

Since December 31, 2005,
the Company has not (i) sold any assets, individually or in the aggregate, in
excess of $500,000 outside of the ordinary course of business or (ii) had
capital expenditures, individually or in the aggregate, in excess of $500,000.

Further,
in connection with the Financing, the Company will do the following on or prior
to the Closing:

·                  deliver
to each Investor a certificate evidencing the incorporation and good standing
of the Company and each of its operating Subsidiaries in such corporation’s
state of incorporation issued by the Secretary of State of such state of
incorporation as of a date within 10 days of the Closing Date;

7068 Koll Center
Parkway, Suite 401, Pleasanton, CA 
94566-3111

Tel:  925-249-4000    Fax: 
925-249-4040

www.lipidsciences.com

 

·                  deliver
to each Investor a letter from the Company’s transfer agent certifying the number
of shares of Common Stock outstanding as of a date within five days of the
Closing Date; and

·                  obtain
all governmental, regulatory or third party consents and approvals, if any,
necessary for the sale of the Shares.

Please call me if you have any questions.

Sincerely,

LIPID SCIENCES, INC.

	
  

  	
  By:

  	
   

  	
  /s/ S. Lewis Meyer, Ph.D.

  	
   

  
	
   

  	
   

  	
   

  	
  S. Lewis Meyer, Ph.D.

  
	
   

  	
   

  	
   

  	
  President and Chief Executive Officer

  

 

 2Exhibit 10.1

Execution Copy

 

CREDIT
AGREEMENT

dated as
of December 18, 2006

among

HELMERICH & PAYNE
INTERNATIONAL DRILLING CO.

as
Borrower,

HELMERICH & PAYNE, INC.

as
Parent,

WELLS FARGO BANK, NATIONAL
ASSOCIATION

as
Administrative Agent, Issuing Lender and Swingline Lender,

JPMORGAN
CHASE BANK, N.A.

as Syndication Agent,

THE BANK
OF TOKYO-MITSUBISHI UFJ, LTD.

CITIBANK, N.A.,

and

FORTIS CAPITAL CORP.

as Co-Documentation Agents

and

THE LENDERS PARTY HERETO FROM
TIME TO TIME

as
Lenders

$400,000,000

 

WELLS FARGO
BANK, NATIONAL ASSOCIATION

and

J.P. MORGAN SECURITIES INC.

as Co-Lead Arrangers and Joint
Bookrunners

 

TABLE OF
CONTENTS

	
   

  	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE I

  	
  DEFINITIONS AND ACCOUNTING TERMS

  	
   

  	
  1

  
	
   

  
	
  Section 1.1

  	
   

  	
  Certain Defined Terms

  	
   

  	
  1

  
	
  Section 1.2

  	
   

  	
  Accounting Terms; Changes in GAAP

  	
   

  	
  14

  
	
  Section 1.3

  	
   

  	
  Classes and Types of Advances

  	
   

  	
  14

  
	
  Section 1.4

  	
   

  	
  Other Interpretive Provisions

  	
   

  	
  15

  
	
   

  
	
  ARTICLE II

  	
  CREDIT FACILITIES

  	
   

  	
  15

  
	
   

  	
   

  	
   

  
	
  Section 2.1

  	
   

  	
  Commitments

  	
   

  	
  15

  
	
  Section 2.2

  	
   

  	
  Evidence of Indebtedness

  	
   

  	
  18

  
	
  Section 2.3

  	
   

  	
  Letters of Credit

  	
   

  	
  18

  
	
  Section 2.4

  	
   

  	
  Swingline Advances

  	
   

  	
  22

  
	
  Section 2.5

  	
   

  	
  Borrowings; Procedures and Limitations

  	
   

  	
  24

  
	
  Section 2.6

  	
   

  	
  Prepayments

  	
   

  	
  27

  
	
  Section 2.7

  	
   

  	
  Repayment

  	
   

  	
  27

  
	
  Section 2.8

  	
   

  	
  Fees

  	
   

  	
  28

  
	
  Section 2.9

  	
   

  	
  Interest

  	
   

  	
  28

  
	
  Section 2.10

  	
   

  	
  Illegality

  	
   

  	
  29

  
	
  Section 2.11

  	
   

  	
  Breakage Costs

  	
   

  	
  29

  
	
  Section 2.12

  	
   

  	
  Increased Costs

  	
   

  	
  30

  
	
  Section 2.13

  	
   

  	
  Payments and Computations

  	
   

  	
  31

  
	
  Section 2.14

  	
   

  	
  Taxes

  	
   

  	
  33

  
	
  Section 2.15

  	
   

  	
  Mitigation Obligations

  	
   

  	
  35

  
	
   

  
	
  ARTICLE III

  	
  CONDITIONS PRECEDENT

  	
   

  	
  35

  
	
   

  
	
  Section 3.1

  	
   

  	
  Conditions Precedent to Initial Credit Extension

  	
   

  	
  35

  
	
  Section 3.2

  	
   

  	
  Conditions Precedent to Each Credit Extension

  	
   

  	
  37

  
	
   

  
	
  ARTICLE IV

  	
  REPRESENTATIONS AND WARRANTIES

  	
   

  	
  37

  
	
   

  
	
  Section 4.1

  	
   

  	
  Organization

  	
   

  	
  37

  
	
  Section 4.2

  	
   

  	
  Authorization

  	
   

  	
  37

  
	
  Section 4.3

  	
   

  	
  Enforceability

  	
   

  	
  38

  
	
  Section 4.4

  	
   

  	
  Financial Condition

  	
   

  	
  38

  
	
  Section 4.5

  	
   

  	
  Ownership and Liens

  	
   

  	
  38

  
	
  Section 4.6

  	
   

  	
  True and Complete Disclosure

  	
   

  	
  38

  
	
  Section 4.7

  	
   

  	
  Litigation

  	
   

  	
  38

  
	
  Section 4.8

  	
   

  	
  Compliance with Agreements

  	
   

  	
  38

  
	
  Section 4.9

  	
   

  	
  Pension Plans

  	
   

  	
  39

  
								

 

 i
 

 

 

	
  Section 4.10

  	
   

  	
  Environmental Condition

  	
   

  	
  39

  
	
  Section 4.11

  	
   

  	
  Subsidiaries

  	
   

  	
  40

  
	
  Section 4.12

  	
   

  	
  Investment Company Act

  	
   

  	
  40

  
	
  Section 4.13

  	
   

  	
  Taxes

  	
   

  	
  40

  
	
  Section 4.14

  	
   

  	
  Permits, Licenses, etc

  	
   

  	
  40

  
	
  Section 4.15

  	
   

  	
  Use of Proceeds

  	
   

  	
  40

  
	
  Section 4.16

  	
   

  	
  Condition of Property; Casualties

  	
   

  	
  40

  
	
  Section 4.17

  	
   

  	
  Insurance

  	
   

  	
  41

  
	
   

  
	
  ARTICLE V

  	
  AFFIRMATIVE COVENANTS

  	
   

  	
  41

  
	
   

  
	
  Section 5.1

  	
   

  	
  Organization

  	
   

  	
  41

  
	
  Section 5.2

  	
   

  	
  Reporting

  	
   

  	
  41

  
	
  Section 5.3

  	
   

  	
  Insurance

  	
   

  	
  44

  
	
  Section 5.4

  	
   

  	
  Compliance with Laws

  	
   

  	
  44

  
	
  Section 5.5

  	
   

  	
  Taxes

  	
   

  	
  44

  
	
  Section 5.6

  	
   

  	
  Additional Guarantors

  	
   

  	
  44

  
	
  Section 5.7

  	
   

  	
  Records; Inspection

  	
   

  	
  44

  
	
  Section 5.8

  	
   

  	
  Maintenance of Property

  	
   

  	
  45

  
	
   

  
	
  ARTICLE VI

  	
  NEGATIVE COVENANTS

  	
   

  	
  45

  
	
   

  
	
  Section 6.1

  	
   

  	
  Debt

  	
   

  	
  45

  
	
  Section 6.2

  	
   

  	
  Liens

  	
   

  	
  45

  
	
  Section 6.3

  	
   

  	
  Investments

  	
   

  	
  46

  
	
  Section 6.4

  	
   

  	
  Acquisitions

  	
   

  	
  46

  
	
  Section 6.5

  	
   

  	
  Agreements
  Restricting Liens; Negative Pledge

  	
   

  	
  46

  
	
  Section 6.6

  	
   

  	
  Use of Proceeds;
  Use of Letters of Credit

  	
   

  	
  47

  
	
  Section 6.7

  	
   

  	
  Corporate
  Actions; Fundamental Changes

  	
   

  	
  47

  
	
  Section 6.8

  	
   

  	
  Sale of Assets

  	
   

  	
  47

  
	
  Section 6.9

  	
   

  	
  Restricted
  Payments

  	
   

  	
  48

  
	
  Section 6.10

  	
   

  	
  Affiliate
  Transactions

  	
   

  	
  48

  
	
  Section 6.11

  	
   

  	
  Line of Business

  	
   

  	
  48

  
	
  Section 6.12

  	
   

  	
  Compliance with
  ERISA

  	
   

  	
  48

  
	
  Section 6.13

  	
   

  	
  Hedging
  Arrangements

  	
   

  	
  48

  
	
  Section 6.14

  	
   

  	
  Funded Leverage
  Ratio

  	
   

  	
  48

  
	
  Section 6.15

  	
   

  	
  Interest
  Coverage Ratio

  	
   

  	
  49

  
	
   

  	
   

  	
   

  
						

 

 ii
 

 

 

	
  ARTICLE VII

  	
  DEFAULT AND REMEDIES

  	
   

  	
  49

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 7.1

  	
   

  	
  Events of Default

  	
   

  	
  49

  
	
  Section 7.2

  	
   

  	
  Optional Acceleration of Maturity

  	
   

  	
  50

  
	
  Section 7.3

  	
   

  	
  Automatic Acceleration of Maturity

  	
   

  	
  51

  
	
  Section 7.4

  	
   

  	
  Set-off

  	
   

  	
  51

  
	
  Section 7.5

  	
   

  	
  Remedies Cumulative, No Waiver

  	
   

  	
  52

  
	
  Section 7.6

  	
   

  	
  Application of Payments

  	
   

  	
  52

  
	
   

  
	
  ARTICLE VIII

  	
  THE ADMINISTRATIVE AGENT AND ISSUING LENDERS

  	
   

  	
  53

  
	
   

  
	
  Section 8.1

  	
   

  	
  Appointment and Authority

  	
   

  	
  53

  
	
  Section 8.2

  	
   

  	
  Rights as a Lender

  	
   

  	
  53

  
	
  Section 8.3

  	
   

  	
  Exculpatory Provisions

  	
   

  	
  53

  
	
  Section 8.4

  	
   

  	
  Reliance by Administrative Agent

  	
   

  	
  54

  
	
  Section 8.5

  	
   

  	
  Delegation of Duties

  	
   

  	
  54

  
	
  Section 8.6

  	
   

  	
  Resignation of Administrative Agent or Issuing
  Lender

  	
   

  	
  54

  
	
  Section 8.7

  	
   

  	
  Non-Reliance on Administrative Agent and Other
  Lenders

  	
   

  	
  55

  
	
  Section 8.8

  	
   

  	
  No Other Duties, etc

  	
   

  	
  55

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
  MISCELLANEOUS

  	
   

  	
  55

  
	
   

  	
   

  	
   

  
	
  Section 9.1

  	
   

  	
  Expenses; Indemnity; Damage Waiver

  	
   

  	
  55

  
	
  Section 9.2

  	
   

  	
  Waivers and Amendments

  	
   

  	
  57

  
	
  Section 9.3

  	
   

  	
  Severability

  	
   

  	
  57

  
	
  Section 9.4

  	
   

  	
  Survival of Representations and Obligations

  	
   

  	
  57

  
	
  Section 9.5

  	
   

  	
  Successors and Assigns Generally

  	
   

  	
  58

  
	
  Section 9.6

  	
   

  	
  Lender Assignments and Participations

  	
   

  	
  58

  
	
  Section 9.7

  	
   

  	
  Notices, Etc

  	
   

  	
  60

  
	
  Section 9.8

  	
   

  	
  Confidentiality

  	
   

  	
  61

  
	
  Section 9.9

  	
   

  	
  Business Loans

  	
   

  	
  62

  
	
  Section 9.10

  	
   

  	
  Usury Not Intended

  	
   

  	
  62

  
	
  Section 9.11

  	
   

  	
  Usury Recapture

  	
   

  	
  62

  
	
  Section 9.12

  	
   

  	
  Payments Set Aside

  	
   

  	
  63

  
	
  Section 9.13

  	
   

  	
  Governing Law; Submission to Jurisdiction

  	
   

  	
  63

  
	
  Section 9.14

  	
   

  	
  Execution and Effectiveness

  	
   

  	
  64

  
	
  Section 9.15

  	
   

  	
  Waiver of Jury

  	
   

  	
  64

  
	
  Section 9.16

  	
   

  	
  USA PATRIOT ACT Notice

  	
   

  	
  64

  
									

 

 iii
 

 

 

	
  EXHIBITS:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit A

  	
  -

  	
  Assignment and Assumption

  	
   

  	
   

  
	
  Exhibit B

  	
  -

  	
  Compliance Certificate

  	
   

  	
   

  
	
  Exhibit C

  	
  -

  	
  Guaranty

  	
   

  	
   

  
	
  Exhibit D

  	
  -

  	
  Notice of Borrowing

  	
   

  	
   

  
	
  Exhibit E

  	
  -

  	
  Notice of Conversion or Continuance

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULES:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Schedule I

  	
  –

  	
  Pricing Schedule

  	
   

  	
   

  	 

	
  Schedule II

  	
  –

  	
  Revolving Commitments

  	
   

  	
   

  	 

	
  Schedule III

  	
  –

  	
  Notice Information

  	
   

  	
   

  	 

	
  Schedule IV

  	
  –

  	
  Existing Letters of Credit

  	
   

  	
   

  	 

	
  Schedule 3.1(f)

  	
  –

  	
  Material Adverse Change

  	
   

  	
   

  	 

	
  Schedule 4.11

  	
  –

  	
  Subsidiaries

  	
   

  	
   

  	 

	
  Schedule 6.12

  	
  –

  	
  ERISA

  	
   

  	
   

  	 

										

 

 iv

CREDIT AGREEMENT

This CREDIT
AGREEMENT dated as of December 18, 2006 (“Agreement”) is
among (a) Helmerich & Payne International Drilling Co.,
a Delaware corporation (“Borrower”), (b) Helmerich
& Payne, Inc., a Delaware corporation (“Parent”), (c) the
Lenders (as defined below), and (d) Wells Fargo Bank, National
Association, as Swingline Lender, an Issuing Lender, and as the
Administrative Agent (each as defined below) for the Lenders.

The parties hereto hereby
agree as follows:

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

Section
1.1            Certain Defined Terms.  As used in this Agreement, the defined terms
set forth in the recitals above shall have the meanings set forth above and the
following terms shall have the following meanings:

“Acquisition” means
the purchase by the Parent or any of its Subsidiaries of any business,
including the purchase of associated assets or operations or the Equity
Interests of a Person.

“Additional Lender”
shall have the meaning assigned to such term in Section 2.1(c).

“Adjusted Base Rate”
means, for any day, a fluctuating rate per annum of interest equal to the
greater of (a) the Prime Rate in effect on such day and (b) the
Federal Funds Rate in effect on such day plus 0.5%.  Any change in the Adjusted Base Rate due to a
change in the Prime Rate or the Federal Funds Rate shall be effective on the
effective date of such change in the Prime Rate or Federal Funds Rate.

“Administrative Agent”
means Wells Fargo in its capacity as agent for the Lenders pursuant to
Article VIII and any successor agent pursuant to Section 8.6.

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

“Advance” means a
Revolving Advance or a Swingline Advance.

“Affiliate” means,
with respect to a specified 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.

“Applicable Margin”
means, at any time, with respect to each Type of Advance, the Letters of Credit
and the Commitment Fees, the percentage rate per annum which is applicable at
such time with respect to such Advance, Letter of Credit or Commitment Fee as
set forth in Schedule I.

“Applicable Percentage”
means, with respect to any Lender, (i) the ratio (expressed as a percentage) of
such Lender’s Revolving Commitment at such time to the aggregate Revolving
Commitments of the Lenders at such time or (ii) if the Revolving Commitments
have been terminated or expired, the ratio (expressed as a percentage) of such
Lender’s Revolving Commitment most recently in effect to the aggregate
Revolving Commitments most recently in effect, in each case, after giving
effect to any assignments.

 

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

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

“Assignment and
Assumption” means an assignment and assumption executed by a Lender and an
Eligible Assignee and accepted by the Administrative Agent and in substantially
the form set forth in Exhibit A.

“Base Rate Advance”
means an Advance which bears interest based upon the Adjusted Base Rate as
provided in Section 2.9(a).

“BOK” means Bank of
Oklahoma, National Association

“Business Day” means
any day (a) other than a Saturday, Sunday or other day on which commercial banks
are authorized to close under the Legal Requirements of, or are in fact closed
in, Texas or Colorado and (b) if the applicable Business Day relates to any
Eurodollar Advances, on which dealings are carried on by commercial banks in
the London interbank market.

“Capital Leases”
means, for any Person, any lease of any Property by such Person as lessee which
would, in accordance with GAAP, be required to be classified and accounted for
as a capital lease on the balance sheet of such Person.

“Cash Collateral Account”
means a special cash collateral account pledged to the Administrative Agent
containing cash deposited pursuant to the terms hereof to be maintained with
the Administrative Agent in accordance with Section 2.3(g).

“CERCLA” means the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980,
state and local analogs, and all rules and regulations and requirements
thereunder.

“Change in Control”
means the occurrence of any of the following events: (a) any “person” or “group”
(as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange
Act of 1934, but excluding any employee benefit plan of such person or its
subsidiaries, and any person or entity acting in its capacity as trustee, agent
or other fiduciary or administrator of any such plan) becomes the “beneficial
owner” (as defined in Rules 13d-3 and 13d-5 under the Securities Exchange Act
of 1934, except that a person or group shall be deemed to have “beneficial
ownership” of all securities that such person or group has the right to acquire
(such right, an “option right”), whether such right is exercisable immediately
or only after the passage of time), directly or indirectly, of 50% or more of
the equity securities of the Parent entitled to vote for members of the board
of directors or equivalent governing body of the Parent on a fully-diluted
basis (and taking into account all such securities that such person or group
has the right to acquire pursuant to any option right), or (b) during any
period of 12 consecutive months, a majority of the members of the board of
directors or other equivalent governing body of the Parent cease to be composed
of individuals (i) who were members of that board or equivalent governing body
on the first day of such period, (ii) whose election or nomination to that
board or equivalent governing body was approved by individuals referred to in
clause (i) above constituting at the time of such election or nomination at
least a majority of that board or equivalent governing body or (iii) whose
election or nomination to that board or other equivalent governing body was
approved by individuals referred to in clauses (i) and (ii) above constituting
at the time of such election or nomination at least a majority of that board or
equivalent governing body.

 2
 

 

“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.

“Class” has the
meaning set forth in Section 1.3.

“Closing
Date” means the first date all the conditions precedent in Section 3.1 are
satisfied or waived in accordance with Section 9.2.

“Code” means the
Internal Revenue Code of 1986, and the regulations and published
interpretations thereof.

“Commitment Fee”
means the fees required under Section 2.8(a).

“Commitment Increase”
has the meaning set forth in Section 2.1(c).

“Commitments” means,
as to any Lender, its Revolving Commitment and as to the Swingline Lender, its
Swingline Commitment.

“Compliance Certificate”
means a compliance certificate executed by a senior financial officer of the
Parent in substantially the same form as Exhibit B.

“Contingent Debt”
means, with respect to any Person, without duplication, any contingent
liabilities, obligations or indebtedness of such Person (other than
endorsements in the ordinary course of business of negotiable instruments for
deposit or collection), including (a) any obligations or similar undertakings
to guarantee any Indebtedness of any other Person in any manner, whether direct
or indirect, and including any obligation to purchase any such Debt or any
Property constituting security therefor, to advance or provide funds or other
support for the payment or purchase of any such Debt or to maintain working capital,
solvency or other balance sheet condition of such other Person (including keep
well agreements, maintenance agreements, comfort letters or similar agreements
or arrangements) for the benefit of any holder of Indebtedness of such other
Person, to lease or purchase Property, securities or services primarily for the
purpose of assuring the holder of such Indebtedness, or otherwise to assure or
hold harmless the holder of such Debt against loss in respect thereof, (b)
obligations to indemnify other Persons against liability or loss, to the extent
not arising in the ordinary course of business, and (c) warranty obligations
and other contractually assumed obligations, to the extent not arising in the
ordinary course of business.

“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.

“Controlled Group”
means all members of a controlled group of corporations and all businesses
(whether or not incorporated) under common control which, together with the
Parent or any Subsidiary (as applicable), are treated as a single employer under
Section 414 of the Code.

“Convert”, “Conversion”
and “Converted” each refers to a conversion of Revolving Advances of one
Type into a Revolving Advances of another Type pursuant to Section 2.5(b).

 3
 

 

“Credit Documents”
means this Agreement, the Notes, the Letter of Credit Documents, the Guaranty,
the Fee Letter, and each other agreement, instrument, or document executed at
any time in connection with this Agreement.

“Credit Extension”
means an Advance or a Letter of Credit Extension.

“Credit Parties”
means the Borrower and the Guarantors.

“Debt” means, for any
Person, without duplication: 
(a) all obligations of such Person for borrowed money, (b) all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments, or upon which interest payments are customarily made;
(c) all obligations of such Person under conditional sale or other title
retention agreements relating to any Properties purchased by such Person (other
than customary reservations or retentions of title under agreements with
suppliers entered into in the ordinary course of business), (d) all obligations
of such Person issued or assumed as the deferred purchase price of Property or
services purchased by such Person (other than trade debt incurred in the
ordinary course of business and due within six months of the incurrence
thereof) which would appear as liabilities on a balance sheet of such Person,
(e) all obligations of such Person under take-or-pay or similar arrangements or
under commodities agreements, (f) all Debt of others secured by (or for which
the holder of such Debt has an existing right, contingent or otherwise, to be
secured by) any Lien on, or payable out of the proceeds of production from,
Property owed by such Person, whether or not the obligation secured thereby
have been assumed, (g) all Contingent Debt of such Person with respect to Debt
of another Person, (h) the principal portion of all obligations of such Person
under Capital Leases, (i) all net obligations of such Person under Hedging
Arrangements, (j) the maximum amount of all standby letters of credit issued or
bankers’ acceptances facilities created for the account of such Person and,
without duplication, all drafts drawn thereunder (to the extent unreimbursed),
(k) all preferred Equity Interests issued by such Person and which by the terms
thereof could be (at the request of the holders thereof or otherwise) subject
to mandatory sinking fund payments, repurchase, redemption or other
acceleration any time during the period ending one year after the term of the
Agreement, (l) the principal portion of all obligations of such Person under
Synthetic Leases, and (m) the Debt of any partnership or unincorporated joint
venture in which such Person is a general partner or a joint venturer, but only
to the extent to which there is recourse to such Person for the payment of such
Debt.

“Debtor Relief Laws”
means (a) the Bankruptcy Code of the United States, and (b) 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
(a) an Event of Default or (b) any event or condition which with
notice or lapse of time or both would, unless cured or waived, become an Event
of Default.

“Dollars” and “$”
means lawful money of the United States.

“Domestic Subsidiary” means, with respect to any Person, any
of its Subsidiaries that is incorporated or organized under the laws of the
United States, any State thereof or the District of Columbia.

“EBITDA” means,
without duplication, for the Parent and its consolidated Subsidiaries, the sum
of (a) its  Net Income for such
period plus (b) to the extent deducted in determining Net Income,
Interest Expense, taxes, depreciation, amortization and other non-recurring,
non-cash charges and other non-cash extraordinary items for such period minus (c) to the extent included in determining Net
Income, non-recurring gains (including gains on the sale of Marketable
Securities), in each case determined in accordance with GAAP; provided
that such EBITDA shall be subject to pro forma adjustments for

 4
 

 

Acquisitions
and Nonordinary Course Asset Sales assuming that such transactions had occurred
on the first day of the determination period, which adjustments shall be made
in accordance with the guidelines for pro forma presentations set forth by the
SEC.

“Eligible Assignee” means
(a) a Lender; (b) an Affiliate of a Lender; (c) an Approved Fund; and (d) any
other Person (other than a natural person) approved by (i) the Administrative
Agent, (ii) each Issuing Lender; provided that, BOK’s consent, as an Issuing
Lender, shall not be required if no Existing Letters of Credit are outstanding,
and (iii) unless an Event of Default has occurred and is continuing at the time
any assignment is effected in accordance with Section 9.6, the Borrower (each
such approval not to be unreasonably withheld or delayed); provided,
however, that neither the Parent nor an Affiliate of the Parent shall qualify
as an Eligible Assignee.

“Environment” or “Environmental”
shall have the meanings set forth in 42 U.S.C. 
9601(8) (1988).

“Environmental Claim”
means any third party (including governmental agencies and employees) action,
lawsuit, claim, demand, regulatory action or proceeding, order, decree, consent
agreement or notice of potential or actual responsibility or violation
(including claims or proceedings under the Occupational Safety and Health Acts
or similar laws or requirements relating to health or safety of employees)
which seeks to impose liability under any Environmental Law.

“Environmental Law”
means all federal, state, and local laws, rules, regulations, ordinances,
orders, decisions, agreements, and other requirements, including common law
theories, now or hereafter in effect and relating to, or in connection with the
Environment, health, or safety, including without limitation CERCLA, relating
to (a) pollution, contamination, injury, destruction, loss, protection,
cleanup, reclamation or restoration of the air, surface water, groundwater,
land surface or subsurface strata, or other natural resources; (b) solid,
gaseous or liquid waste generation, treatment, processing, recycling,
reclamation, cleanup, storage, disposal or transportation; (c) exposure to
pollutants, contaminants, hazardous, medical infections, or toxic substances,
materials or wastes; (d) the safety or health of employees; or (e) the
manufacture, processing, handling, transportation, distribution in commerce,
use, storage or disposal of hazardous or toxic substances, materials or wastes.

“Environmental Permit”
means any permit, license, order, approval, registration or other authorization
under Environmental Law.

“ERISA” means the
Employee Retirement Income Security Act of 1974, as amended from time to time.

“Equity Interest”
means with respect to any Person, any shares, interests, participation, or
other equivalents (however designated) of corporate stock, membership interests
or partnership interests (or any other ownership interests) of such Person.

“Eurodollar Advance”
means a Revolving Advance that bears interest based upon the Eurodollar Rate.

“Eurocurrency Liabilities”
has the meaning assigned to that term in Regulation D of the Federal Reserve
Board as in effect from time to time.

“Eurodollar Rate”
means, for the Interest Period for each Eurodollar Advance comprising the same
Revolving Borrowing, the interest rate per annum (rounded upward to the nearest
whole multiple of 1/100 of 1%) equal to (a) the applicable London interbank
offered rate for deposits in Dollars for such Revolving Borrowing appearing on
the applicable Telerate British Bankers Association Interest Settlement Rate
page for Dollars as of 11:00 a.m. (London, England time) two Business Days
prior to the first day of such Interest Period, and having a maturity equal to
such Interest Period, (b) if the rate as 

 5
 

 

determined under clause (a)
is not available at such time for any reason, the London interbank offered rate
for deposits in Dollars appearing on Reuters Screen FRBD as of 11:00 a.m.
(London, England time) two Business Days prior to the first day of such
Interest Period, and having a maturity equal to such Interest Period), and (c)
if the rate as determined under clause (a) or clause (b) is not available at
such time for any reason, then the rate determined by the Administrative Agent
to be the rate at which deposits in Dollars for delivery on the first day of
such Interest Period in immediately available funds in the approximate amount
of the Eurodollar Advance being made, continued or converted by the
Administrative Agent and with a term equivalent to such Interest Period would
be offered by the Administrative Agent’s London Branch (or other branch or
Affiliate of the Administrative Agent) to major banks in the London or other
offshore interbank market for such currency at their request at approximately
11:00 a.m. (London time) two Business Days prior to the commencement of such
Interest Period.

“Event of Default”
has the meaning specified in Section 7.1.

“Excluded Taxes”
means, with respect to any Lender Party or any other recipient of any payment
to be made by or on account of any obligation of the Borrower hereunder, (a)
taxes imposed on or measured by its 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, (b)
any branch profits taxes imposed by the United States or any similar tax
imposed by any other jurisdiction in which the Borrower is located and (c)
except as provided in the following sentence, in the case of a Foreign Lender,
any withholding tax that is imposed on amounts payable to such Foreign Lender
at the time such Foreign Lender becomes a party hereto (or designates a new
Lending Office) or is attributable to such Foreign Lender’s failure or
inability (other than as a result of a Change in Law) to comply with Section
2.14(d), except to the extent that such Foreign Lender (or its assignor, if
any) was entitled, at the time of designation of a new Lending Office (or
assignment), to receive additional amounts from the Borrower with respect to
such withholding tax pursuant to Section 2.14. 
Notwithstanding anything to the contrary contained in this definition, “Excluded
Taxes” shall not include any withholding tax imposed at any time on payments
made by or on behalf of a Foreign Subsidiary to any Lender Party hereunder or
under any other Credit Document, provided that such Lender, the
Administrative Agent and such Issuing Lender shall have complied with Section
2.14(d)(iii).

“Existing Credit
Agreement” means the Credit Agreement dated as of July 16, 2002, as
heretofore amended, among the Parent, the Borrower, the lenders party thereto
and BOK, as administrative agent.

“Existing Letters of
Credit” means the letters of credit listed on Schedule IV and issued by BOK
which have not been terminated or expired and returned to BOK on or before the
Closing Date.

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

“Federal Reserve Board”
means the Board of Governors of the Federal Reserve System or any of its
successors.

 6
 

 

“Fee Letter” means
that certain fee letter dated October 20, 2006 among the Parent, the Borrower
and Wells Fargo.

“Financial Statements”
means, for any period, the consolidated financial statements of the Parent and
its consolidated Subsidiaries, including statements of income, retained
earnings and cash flow for such period as well as a balance sheet as of the end
of such period, all prepared in accordance with GAAP.

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

“Foreign Subsidiary”
means any Subsidiary of a Person that is not a Domestic Subsidiary.

“Forward Sale Contract”
means a prepaid forward sale agreement in which the Borrower receives an
up-front payment in exchange for a commitment to deliver securities in the
future, with the number of shares to be delivered varying with the share price
at maturity.

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

“Funded Debt” means
all Debt of the Parent and its consolidated Subsidiaries of the types described
in clauses (a), (b), (c), (d), (f), (g), (h), (j), (l) and (m) of the
definition of “Debt” (but with respect to Debt described such clauses (f) and
(g), only to the extent such Debt relates to the types of Debt described above
and excluding any intercompany Debt of the Parent and its Subsidiaries).

“Funded Leverage Ratio”
means, as of the end of any fiscal quarter, the ratio (expressed as a
percentage) of (a) all Funded Debt, minus the aggregate amount of any Funded
Debt incurred as the direct result of Forward Sale Contracts relating to
securities held in the Investment Portfolio, as long as such Funded Debt is
fully secured by Marketable Securities, to (b) the sum of (i) all Funded Debt
plus (ii) the consolidated Net Worth of the Parent, each as of the last day of
such fiscal quarter.

“GAAP” means United
States generally accepted accounting principles as in effect from time to time,
applied on a basis consistent with the requirements of Section 1.2.

“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).

“Guarantors” means
the Parent and any Person that now or hereafter executes a Guaranty or a
joinder or supplement to a Guaranty.

“Guaranty” means a guaranty substantially in the form of
Exhibit C made by the Parent and the Material Subsidiaries of the Borrower
party thereto from time to time in favor of the Administrative Agent for the
benefit of the Lender Parties.

 7
 

 

“Hazardous Substance”
means any substance or material identified as such pursuant to CERCLA and those
regulated under any other Environmental Law, including without limitation
pollutants, contaminants, petroleum, petroleum products, radionuclides, and
radioactive materials.

“Hazardous Waste”
means any substance or material regulated or designated as such pursuant to any
Environmental Law, including without limitation, pollutants, contaminants,
flammable substances and materials, explosives, radioactive materials, oil,
petroleum and petroleum products, chemical liquids and solids, polychlorinated
biphenyls, asbestos, toxic substances, and similar substances and materials.

“Hedging Arrangement”
means a hedge, call, swap, collar, floor, cap, option, forward sale or purchase
or other contract or similar arrangement (including any obligations to purchase
or sell any commodity or security at a future date for a specific price) which
is entered into to reduce or eliminate or otherwise protect against the risk of
fluctuations in prices or rates, including interest rates, foreign exchange
rates, commodity prices and securities prices.

“Increase Date” means
the effective date of a Commitment Increase as provided in Section 2.1(c).

“Increasing Lender”
shall have the meaning assigned to such term in Section 2.1(c).

“Indemnified Taxes”
means Taxes other than Excluded Taxes.

“Indemnitees” has the
meaning specified in Section 9.1.

“Interest Expense”
means, for any period and with respect to any Person, total interest expense
(net of interest income) whether paid or accrued, including, without
limitation, all commissions, discounts, and other fees and charges owed with
respect to letters of credit and bankers’ acceptance financing, fees owed with
respect to the Obligations, the interest component under Capital Leases and net
costs under Hedge Arrangements, all as determined in conformity with GAAP.

“Interest Period”
means for each Eurodollar Advance comprising part of the same Revolving
Borrowing, the period commencing on the date of such Eurodollar Advance is made
or deemed made and ending on the last day of the period selected by the
Borrower pursuant to the provisions below and Section 2.5, and thereafter, each
subsequent period commencing on the last day of the immediately preceding
Interest Period and ending on the last day of the period selected by the
Borrower pursuant to the provisions below and Section 2.5.  The duration of each such Interest Period
shall be one, two, three, or six months, in each case as the Borrower may
select, provided that:

(a)     Interest Periods commencing on the same
date for Advances comprising part of the same Revolving Borrowing shall be of
the same duration;

(b)     whenever the last day of any Interest
Period would otherwise occur on a day other than a Business Day, the last day
of such Interest Period shall be extended to occur on the next succeeding
Business Day, provided that if such extension would cause the last day
of such Interest Period to occur in the next following calendar month, the last
day of such Interest Period shall occur on the next preceding Business Day; and

(c)     any Interest Period which 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 in which it
would have ended if there were a numerically corresponding day in such calendar
month.

 8
 

 

“Investment Portfolio” means the Marketable Securities and cash
or cash equivalents maintained by the Parent or any of its Subsidiaries, each
which otherwise complies with the terms of the Parent’s investment policy.

 

“Issuing Lender”
means (a) as to the Existing Letters of Credit, BOK, and (b) as to any other
Letters of Credit issued hereunder, Wells Fargo.

“Legal Requirement”
means any law, statute, ordinance, decree, requirement, order, judgment, rule,
treaty, code, administrative or judicial precedents or authorities, regulation
(or official interpretation of any of the foregoing) of, and the terms of any
license, authorization or permit issued by, and any agreement with, any
Governmental Authority, including, but not limited to, Regulations T, U
and X.

“Lender Parties”
means Lenders, the Issuing Lenders, the Swingline Lender and the Administrative
Agent.

“Lenders” means the
Persons listed on Schedule II and any other Person that shall have become
a party hereto pursuant to an Assignment and Assumption, other than any such
Person that ceases to be a party hereto pursuant to an Assignment and
Assumption.  Unless the context otherwise
requires, the term “Lenders” includes the Swingline Lender.

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

“Letter of Credit”
means any standby or commercial letter of credit issued by an Issuing Lender
for the account of the Borrower or any Subsidiary thereof pursuant to the terms
of this Agreement, in such form as may be agreed by the Borrower and the
applicable Issuing Lender.

“Letter of Credit
Application” means the applicable Issuing Lender’s standard form letter of
credit application for standby or commercial letters of credit which has been
executed by the Borrower and accepted by the applicable Issuing Lender in
connection with the issuance of a Letter of Credit.

“Letter of Credit
Documents” means all Letters of Credit, Letter of Credit Applications and
amendments thereof, and agreements, documents, and instruments entered into in
connection therewith or relating thereto.

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

“Letter of Credit
Exposure” means the aggregate outstanding undrawn amount of Letters of
Credit plus the aggregate unpaid amount of all of the Borrower’s payment
obligations under drawn Letters of Credit.

“Letter of Credit Maximum
Amount” means $100,000,000.

“Letter of Credit
Obligations” means any obligations of the Borrower under this Agreement in
connection with the Letters of Credit.

“Lien” means any
mortgage, lien, pledge, charge, deed of trust, security interest, or
encumbrance to secure or provide for the payment of any obligation of any
Person, whether arising by contract, operation of law, or otherwise (including
the interest of a vendor or lessor under any conditional sale agreement,
Capital Lease, or other title retention agreement).

 9
 

 

“Majority Lenders”
means Lenders holding at least 51% of the sum of the unutilized Revolving
Commitments plus the Outstandings (with the aggregate amount of each Lender’s
risk participation and funded participation in the Letter of Credit Obligations
and Swingline Advances being deemed “held” by such Lender for purposes of this
definition).

“Marketable Securities”
means readily marketable publicly-traded securities, including any stock or
other equity security publicly-traded on the New York Stock Exchange, the
American Stock Exchange or the National Association of Securities Dealers
Automated Quotation System (NASDAQ) and, if approved by the Administrative
Agent, any other stock traded on a recognized over-the-counter market.

“Material Adverse Change”
means a material adverse change (a) in the condition (financial or otherwise),
operations, business, assets, liabilities or prospects of the Parent and its
Subsidiaries, taken as a whole; (b) on the validity or enforceability of this
Agreement or any of the other Credit Document or the rights, benefits or
remedies of the Administrative Agent or the Lenders under any Credit Document;
or (c) on the Parent’s, the Borrower’s or any other Credit Party’s ability to
perform its obligations under this Agreement, any Note, the Guaranty or any
other Credit Document.

“Material Subsidiary”
means, as of a determination date, any Domestic Subsidiary whose (a) EBITDA for
the immediately preceding fiscal quarter as determined in accordance with GAAP,
or (b) book value of total assets as established in accordance with GAAP, is
equal to or greater than 5% of any of the Parent’s (i) consolidated EBITDA for
the immediately preceding fiscal quarter as determined in accordance with GAAP
or (ii) consolidated book value of total assets as established in accordance
with GAAP, and in each case as reflected in the Financial Statements covering
such immediately preceding fiscal quarter and delivered to the Administrative
Agent and the Lenders pursuant to the terms hereof.

“Maturity Date” means
the earlier of (a)  December 18, 2011 or such other extended maturity date
if maturity is extended pursuant to Section 2.1(d), and (b) the earlier
termination in whole of the Revolving Commitments pursuant to Section 2.1(b) or
Article VII.

“Maximum Rate” means
the maximum nonusurious interest rate under applicable law.

“Moody’s” means Moody’s
Investors Service, Inc. and any successor thereto which is a nationally
recognized statistical rating organization.

“Multiemployer Plan”
means a “multiemployer plan” as defined in Section 4001(a)(3) of ERISA to which
the Parent or any member of the Controlled Group is making or accruing an
obligation to make contributions.

“Net Income” means,
for any period and with respect to any Person, the net income for such period
for such Person after taxes as determined in accordance with GAAP, excluding,
however, (a) extraordinary items, including (i) any net non-cash gain
or loss during such period arising from the sale, exchange, retirement or other
disposition of capital assets (such term to include all fixed assets and all
securities) other than in the ordinary course of business, and (ii) any
write-up or write-down of assets and (b) the cumulative effect
of any change in GAAP.

“Net Worth” means as
of the date of its determination, consolidated shareholders’ equity of the
Parent and its consolidated Subsidiaries, as determined in accordance with
GAAP.

“Non-Extending Lender”
has the meaning specified in Section 2.1(d).

“Non-Guarantor Subsidiary”
means any Subsidiary that is not Credit Party.

 10
 

 

“Nonordinary Course Asset
Sales” means, any sales, conveyances, or other transfers of Property made
by the Parent or any Subsidiary (a) of any division of the Parent or any
Subsidiary, (b) of the Equity Interest in a Subsidiary by the Parent or any
other Subsidiary or (c) of any assets of the Parent or any Subsidiary, whether
in a transaction or related series of transactions, outside the ordinary course
of business.

“Notes” means the
Revolving Notes and the Swingline Note.

“Notice of Borrowing”
means a notice of borrowing signed by the Borrower in substantially the same
form as Exhibit D or such other form as shall be reasonably approved by the
Administrative Agent.

“Notice of Continuation
or Conversion” means a notice of continuation or conversion signed by the
Borrower in substantially the same form as Exhibit E or such other form as
shall be reasonably approved by the Administrative Agent.

“Obligations” means
all principal, interest, fees, reimbursements, indemnifications, and other
amounts now or hereafter owed by any Credit Party to any Lender, Swingline
Lender, Issuing Lender, or Administrative Agent under this Agreement and the
Credit Documents, including, the Letter of Credit Obligations, all interest and
fees that accrue after the commencement by or against any Credit Party of any
proceeding under any Debtor Relief Laws naming such Person as the debtor in
such proceeding, regardless of whether such interest and fees are allowed
claims in such proceeding, and any increases, extensions, and rearrangements of
any of the foregoing obligations under any amendments, supplements, and other
modifications of the documents and agreements creating those obligations.

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

“Outstandings” means,
as of any date of determination, the sum of (a) the aggregate outstanding
amount of all Revolving Advances plus (b) the Letter of Credit Exposure plus
(c) the aggregate outstanding amount of all Swingline Advances.

“Overnight Rate”
means, for any day, the greater of (i) the Federal Funds Rate and (ii) an
overnight rate determined by the Administrative Agent, the applicable Issuing
Lender, or Swingline Lender, as the case may be, in accordance with banking
industry rules on interbank compensation.

“Participant” has the
meaning assigned to such term in Section 9.6.

“PBGC” means the
Pension Benefit Guaranty Corporation or any entity succeeding to any or all of
its functions under ERISA.

“Person” means any
natural person, partnership, corporation (including a business trust), joint
stock company, trust, limited liability company, unlimited liability company,
limited liability partnership, unincorporated association, joint venture, or
other entity, or Governmental Authority, or any trustee, receiver, custodian,
or similar official.

“Plan” means an
employee benefit plan (other than a Multiemployer Plan) maintained for
employees of the Parent or any member of the Controlled Group and covered by
Title IV of ERISA or subject to the minimum funding standards under
Section 412 of the Code.

 11
 

 

“Prime Rate” means
the per annum rate of interest established from time to time by the
Administrative Agent at its principal office as its prime rate, which rate may
not be the lowest rate of interest charged by the  Administrative Agent to its customers.

“Property” of any
Person means any property or assets (whether real, personal, or mixed, tangible
or intangible) of such Person.

“Register” has the
meaning set forth in Section 9.6(b).

“Regulations T, U, and X”
means Regulations T, U, and X of the Federal Reserve Board, as each is from
time to time in effect, and all official rulings and interpretations thereunder
or thereof.

“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.

“Release” shall have
the meaning set forth in CERCLA or under any other Environmental Law.

“Reportable Event”
means any of the events set forth in Section 4043(c) of ERISA (other than any
such event not subject to the provision for 30-day notice to the PBGC under the
regulations issued under such section).

“Response” shall have
the meaning set forth in CERCLA or under any other Environmental Law.

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

“Restricted Payment”
means, with respect to any Person, (a) any direct or indirect dividend or
distribution (whether in cash, securities or other Property) or any direct or
indirect payment of any kind or character (whether in cash, securities or other
Property) in consideration for or otherwise in connection with any retirement,
purchase, redemption or other acquisition of any Equity Interest of such
Person, or any options, warrants or rights to purchase or acquire any such
Equity Interest of such Person or (b) principal or interest payments (in cash,
Property or otherwise) on, or redemptions of, subordinated debt of such Person;
provided that the term “Restricted Payment” shall not include any
dividend or distribution payable solely in Equity Interests of such Person, or
warrants, options or other rights to purchase such Equity Interests.

“Revolving Advance”
means an advance by a Lender to the Borrower as a part of a Revolving Borrowing
pursuant to Section 2.1(a) and refers to either a Base Rate Advance or a
Eurodollar Advance.

“Revolving Borrowing”
means a borrowing consisting of simultaneous Revolving Advances of the same
Type made by the Lenders pursuant to Section 2.1(a) or Converted by each Lender
to Revolving Advances of a different Type pursuant to Section 2.5(b).

“Revolving Commitment”
means, for each Lender, the obligation of such Lender to advance to Borrower
the amount set opposite such Lender’s name on Schedule II as its Revolving
Commitment, or if such Lender has entered into any Assignment and Assumption,
set forth for such Lender as its Revolving Commitment in the applicable
Register, as such amount may be reduced or increased pursuant to Section
2.1.  The initial aggregate amount of the
Revolving Commitments on the Closing Date is $400,000,000.

 12
 

 

“Revolving Note”
means a promissory note of the Borrower payable to the order of a Lender in the
amount of such Lender’s Revolving Commitment, in the form provided by the
Administrative Agent and acceptable to the Borrower.

“Same Day Funds”
means immediately available funds.

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

“S&P” means
Standard & Poor’s Ratings Service, a division of The McGraw-Hill
Companies, Inc., or any successor thereof which is a nationally recognized
statistical rating organization.

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

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

“Solvent” means, as
to any Person, on the date of any determination (a) the fair value of the
Property of such Person is greater than the total amount of debts and other
liabilities (including without limitation, contingent liabilities) of such
Person, (b) the present fair salable value of the assets of such Person is
not less than the amount that will be required to pay the probable liability of
such Person on its debts and other liabilities (including, without limitation,
contingent liabilities) as they become absolute and matured, (c) such
Person is able to realize upon its assets and pay its debts and other
liabilities (including, without limitation, contingent liabilities) as they
mature in the normal course of business, (d) such Person does not intend
to, and does not believe that it will, incur debts or liabilities (including,
without limitation, contingent liabilities) beyond such Person’s ability to pay
as such debts and liabilities mature, (e) such Person is not engaged in,
and is not about to engage in, business or a transaction for which such Person’s
Property would constitute unreasonably small capital, and (f) such Person has
not transferred, concealed or removed any Property with intent to hinder, delay
or defraud any creditor of such Person.

“Subsidiary” means,
with respect to any Person (the “parent”) at any date, any other Person
the accounts of which would be consolidated with those of the parent in the
parent’s consolidated financial statements if such financial statements were
prepared in accordance with GAAP as of such date, as well as any Person, a
majority of whose outstanding Voting Securities (other than directors’
qualifying shares) shall at any time be owned by such parent or one or more
Subsidiaries of such parent.  Unless otherwise specified,
all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a
Subsidiary or Subsidiaries of the Parent and shall include the Borrower.

“Swingline Advance”
means an advance by the Swingline Lender to the Borrower pursuant to Section
2.4.

“Swingline Commitment”
means $30,000,000.

“Swingline Lender”
means Wells Fargo.

“Swingline Note”
means the promissory note made by the Borrower payable to the order of the
Swingline Lender in the form provided by the Administrative Agent and
acceptable to the Borrower.

“Swingline Payment Date”
means the last Business Day of each calendar month.

 13
 

 

“Synthetic Lease”
means any synthetic lease, tax retention operating lease, off-balance sheet
loan or similar off-balance sheet financing product where such transaction is
considered borrowed money indebtedness for tax purposes but is classified as an
operating lease under GAAP.

“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.

“Termination Event”
means (a) a Reportable Event with respect to a Plan, (b) the
withdrawal of the Borrower or any member of the Controlled Group from a Plan
during a plan year in which it was a “substantial employer” as defined in
Section 4001(a)(2) of ERISA, (c) the filing of a notice of intent to
terminate a Plan or the treatment of a Plan amendment as a termination under
Section 4041(c) of ERISA, (d) the institution of proceedings to terminate
a Plan by the PBGC, or (e) any other event or condition which constitutes
grounds under Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Plan. 
Notwithstanding the foregoing, a standard termination of a Plan under
Section 4041(b) of ERISA shall not constitute a Termination Event.

“Type” has the
meaning set forth in Section 1.3.

“United States” means
the United States of America.

“Voting Securities”
means (a) with respect to any corporation, capital stock of such corporation
having general voting power under ordinary circumstances to elect directors of
such corporation (irrespective of whether at the time stock of any other class
or classes shall have or might have special voting power or rights by reason of
the happening of any contingency), (b) with respect to any partnership, any
partnership interest or other ownership interest having general voting power to
elect the general partner or other management of the partnership or other
Person, and (c) with respect to any limited liability company, membership
certificates or interests having general voting power under ordinary
circumstances to elect managers of such limited liability company.

“Wells Fargo” means
Wells Fargo Bank, National Association.

Section 1.2            Accounting
Terms; Changes in GAAP.

(a)     Except as otherwise expressly provided
herein, all accounting terms used herein shall be interpreted, and all
financial statements and certificates and reports as to financial matters
required to be delivered to the Lenders hereunder shall be prepared, in
accordance with GAAP applied on a consistent basis. All calculations made for
the purposes of determining compliance with this Agreement shall (except as
otherwise expressly provided herein) be made by application of GAAP applied on
a basis consistent with the most recent Financial Statements delivered pursuant
to Section 5.2.

(b)     Unless otherwise indicated, all Financial
Statements of the Parent, all calculations for compliance with covenants in
this Agreement, all determinations of the Applicable Margin, and all
calculations of any amounts to be calculated under the definitions in Section
1.1 shall be based upon the consolidated accounts of the Parent and its
Subsidiaries in accordance with GAAP.

Section
1.3            Classes and Types of
Advances.  Advances
are distinguished by “Class” and “Type”. 
The “Class”, when used in reference to any Advance, refers to whether
such Advance, or the Advances comprising such Borrowing are Revolving Advances
or Swingline Advances.  The “Type” of an
Advance refers to the determination whether such Advance is a Eurodollar
Advance or a Base Rate Advance.

 14
 

 

Section
1.4            Other Interpretive
Provisions.  With
reference to this Agreement and each other Credit Document, unless otherwise
specified herein or in such other Credit 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
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 Credit Document), (ii) any reference 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 Credit Document, shall be construed to refer to such Credit Document in
its entirety and not to any particular provision thereof, (iv) all references
in a Credit Document to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
the Credit 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
Credit Documents are included for convenience of reference only and shall not
affect the interpretation of this Agreement or any other Credit Document.

ARTICLE
II

CREDIT FACILITIES

Section 2.1            Commitments.

(a)     Revolving Commitment.  Each Lender severally agrees, on the terms
and conditions set forth in this Agreement, to make Revolving Advances to the
Borrower from time to time on any Business Day during the period from the
Closing Date until the Maturity Date; provided that after giving effect
to such Revolving Advances, the Outstandings shall not exceed the aggregate
Revolving Commitments in effect at such time. 
Within the limits of each Lender’s Revolving Commitment, the Borrower
may from time to time borrow, prepay pursuant to Section 2.6, and reborrow
under this Section 2.1(a).

(b)     Reduction of Revolving Commitments.  The Borrower shall have the right, upon at
least three Business Days’ irrevocable notice to the Administrative Agent, to
terminate in whole or reduce ratably in part the unused portion of the
Revolving Commitments; provided that each partial reduction shall be in
the aggregate amount of $10,000,000 and in integral multiples of $1,000,000 in
excess thereof.  Any reduction or
termination of the Revolving Commitments pursuant to this Section shall be
permanent, with no obligation of the Lenders to reinstate such Revolving
Commitments, and the Commitment Fees shall thereafter be computed on the basis
of the Revolving Commitments, as so reduced.

 15
 

 

(c)     Increase in Revolving Commitments.

(i)            At any time prior
to the Maturity Date, the Borrower may effectuate up to three separate
increases in the aggregate Revolving Commitments (each such increase being a “Commitment
Increase”), by designating either one or more of the existing Lenders (each
of which, in its sole discretion, may determine whether and to what degree to
participate in such Commitment Increase) or one or more other banks or other
financial institutions (reasonably acceptable to the Administrative Agent and
the Issuing Lenders but not including BOK if no Existing Letters of Credit are
then outstanding) that at the time agree, in the case of any such bank or
financial institution that is an existing Lender to increase its Revolving
Commitment as such Lender shall so select (an “Increasing Lender”) and,
in the case of any other such bank or financial institution (an “Additional
Lender”), to become a party to this Agreement; provided, however,
that (A) each such Commitment Increase shall be at least $25,000,000, (B) the
aggregate amount of all Commitment Increases shall not exceed $200,000,000, and
(C) all Revolving Commitments and Revolving Advances provided pursuant to a
Commitment Increase shall be available on the same terms as those applicable to
the existing Revolving Commitments and Revolving Advances.  The sum of the increases in the Revolving
Commitments of the Increasing Lenders plus the Revolving Commitments of the
Additional Lenders upon giving effect to a Commitment Increase shall not, in
the aggregate, exceed the amount of such Commitment Increase.  The Borrower shall provide prompt notice of
any proposed Commitment Increase pursuant to this clause (c) to the
Administrative Agent and the Lenders. 
This Section 2.1(c) shall not be construed to create any obligation on
any of the Administrative Agent or any of the Lenders to advance or to commit
to advance any credit to the Borrower or to arrange for any other Person to
advance or to commit to advance any credit to the Borrower.

(ii)           A Commitment
Increase shall become effective upon (A) the receipt by the Administrative
Agent of (1) an agreement in form and substance reasonably satisfactory to the
Administrative Agent signed by the Borrower, each Increasing Lender and each
Additional Lender, setting forth the Commitments, if any, of each such Lender
and setting forth the agreement of each Additional Lender to become a party to
this Agreement and to be bound by all the terms and provisions hereof binding
upon each Lender, and (2) such evidence of appropriate authorization on the
part of the Borrower with respect to such Commitment Increase as the
Administrative Agent may reasonably request, (B) the funding by each Increasing
Lender and Additional Lender of the Revolving Advances to be made by each such
Lender to effect the prepayment requirement set forth in Section 2.6(b)(ii), and
(C) receipt by the Administrative Agent of a certificate of a Responsible
Officer of the Parent stating that, both before and after giving effect to such
Commitment Increase, no Default has occurred and is continuing, and that all
representations and warranties made by the Borrower and the Parent in this
Agreement are true and correct in all material respects, unless such
representation or warranty relates to an earlier date which remains true and
correct as of such earlier date.

(iii)          Notwithstanding
any provision contained herein to the contrary, from and after the date of any
Commitment Increase, all calculations and payments of interest on the Revolving
Advances shall take into account the actual Revolving Commitment of each Lender
and the principal amount outstanding of each Revolving Advance made by such
Lender during the relevant period of time.

(d)     Extension of Maturity Date.

(i)            Requests for
Extension.  The Borrower may, by
notice to the Administrative Agent (who shall promptly notify the Lenders) not
later than 30 days prior to the Maturity Date then in effect hereunder (the “Existing
Maturity Date”), make a one-time request that each Lender extend such
Lender’s Maturity Date for an additional 364 days from the Existing Maturity
Date.  The date on 

 16
 

 

which
the Administrative Agent provides to the Lenders the notice referenced above is
hereinafter referred to as the “Notice Date.”

(ii)           Lender Elections
to Extend.  Each Lender, acting in
its sole and individual discretion, shall, by notice to the Administrative
Agent given not later than 15 days after the Notice Date, advise the
Administrative Agent whether or not such Lender agrees to such extension and
any Lender that does not so advise the Administrative Agent on or before the
date that is 15 days after the Notice Date shall be deemed to be a
Non-Extending Lender.  Each Lender that
determines not to so extend its Maturity Date shall be referred to herein as a “Non-Extending
Lender”.  Each Lender that determines
to extend its Maturity Date shall be referred to herein as an “Extending
Lender”.  The election of any Lender
to agree to such extension shall not obligate any other Lender to so agree.

(iii)          Additional
Commitment Lenders.  The Borrower
shall have the right on or before the Existing Maturity Date to replace each
Non-Extending Lender with, and add as “Lenders” under this Agreement in place
thereof, one or more Eligible Assignees (each, an “Additional Commitment
Lender”), each of which Additional Commitment Lenders shall have entered
into an Assignment and Assumption pursuant to which such Additional Commitment
Lender shall, effective as of the Existing Maturity Date, undertake a Revolving
Commitment (and, if any such Additional Commitment Lender is already a Lender,
its Revolving Commitment shall be in addition to such Lender’s Revolving
Commitment hereunder on such date).

(iv)          Minimum Extension
Requirement.  If (and only if) the
total of the Revolving Commitments of the Lenders that have agreed so to extend
their Maturity Date and the additional Revolving Commitments of the Additional
Commitment Lenders shall be more than 50% of the aggregate amount of the
Revolving Commitments in effect immediately prior to the Existing Maturity
Date, then, effective as of the Existing Maturity Date, the Maturity Date of
each Extending Lender and of each Additional Commitment Lender shall be
extended to the date falling 364 days after the Existing Maturity Date and each
Additional Commitment Lender shall thereupon become a “Lender” for all purposes
of this Agreement.

(v)           Conditions to Effectiveness of Extensions. 
Notwithstanding the foregoing, the extension of the Maturity Date
pursuant to this Section shall not be effective with respect to any Lender
unless: (A) no Default or Event of Default shall have occurred and be
continuing on the date of such extension and after giving effect thereto; (B) the
representations and warranties contained in this Agreement are true and correct
on and as of the date of such extension and after giving effect thereto, as
though made on and as of such date (or, if any such representation or warranty
is expressly stated to have been made as of a specific date, as of such
specific date); (C) the receipt by the Administrative Agent of such evidence of
appropriate authorization on the part of the Borrower with respect to such
extension as the Administrative Agent may reasonably request; (D) on the
Maturity Date (without giving effect to any extension) of each Non-Extending
Lender, the Borrower shall repay any Revolving Advances outstanding on such
date (and pay any additional amounts required pursuant to Section 2.11) and any other Obligations owing to such Non-Extending
Lender to each such Non-Extending Lender and the Revolving Commitments of the
Non-Extending Lenders shall be terminated; and (E) the Borrower shall prepay
any Revolving Advances outstanding on such date (and pay any additional amounts
required pursuant to Section 2.11) to the
extent necessary to keep outstanding Revolving Advances ratable with any
revised Applicable Percentages of the respective Lenders effective as of such
date.

(vi)          Conflicting
Provisions.  This Section shall
supersede any provisions in Section 2.13(f) or 9.2 to the contrary.

 17
 

 

Section 2.2            Evidence of Indebtedness.  The Advances made by each Lender, including the
Swingline Lender, shall be evidenced by one or more accounts or records
maintained by such Lender or the Swingline Lender and by the Administrative
Agent.  The accounts or records
maintained by the Administrative Agent, the Lenders and the Swingline Lender
shall be conclusive absent manifest error of the amount of the Advances made by
such Lenders or the Swingline Lender to the Borrower and the interest and
payments thereon.  Any failure to so
record or any error in doing so shall not, however, limit or otherwise affect
the obligation of the Borrower hereunder to pay any amount owing with respect
to the Obligations.  In the event of any
conflict between the accounts and records maintained by any Lender or the
Swingline Lender and the accounts and records of the Administrative Agent in
respect of such matters, the accounts and records of the Administrative Agent
shall control in the absence of manifest error. 
Upon the request of any Lender to the Borrower made through the
Administrative Agent, the Borrower shall execute and deliver to such Lender or
the Swingline Lender (through the Administrative Agent) a Note which shall
evidence such Lender’s Revolving Advances or Swingline Advances to the Borrower
in addition to such accounts or records. 
Each Lender may attach schedules to such Note and endorse thereon the
date, Type (if applicable), amount, currency and maturity of its Revolving
Advances or Swingline Advances and payments with respect thereto.

Section 2.3            Letters
of Credit.  

(a)     Commitment for Letters of Credit.  Subject to the terms and conditions set forth
in this Agreement and in reliance upon the agreements of the other Lenders set
forth in this Section, the Issuing Lender agrees to, from time to time on any
Business Day during the period from the Closing Date until the Maturity Date,
issue, increase or extend the expiration date of, the Letters of Credit (other
than an increase or extension of an Existing Letter of Credit) for the account
of the Parent or any Subsidiary thereof.

(b)     Limitations.  Notwithstanding the foregoing, no Letter of
Credit will be issued, increased, or extended:

(i)            if such issuance,
increase, or extension would cause the Letter of Credit Exposure to exceed the
lesser of (A) the Letter of Credit Maximum Amount and (B) an amount equal to
(1) the aggregate Revolving Commitments in effect at such time minus (2)
the Outstandings.

(ii)           unless such Letter
of Credit has an expiration date not later than the earlier of (A) sixty months
from the initial issuance of such Letter of Credit and (B) twenty-four months
beyond the Maturity Date;

(iii)          unless such Letter
of Credit is a standby or commercial letter of credit not supporting the
repayment of indebtedness for borrowed money of any Person;

(iv)          unless such Letter
of Credit is in form and substance acceptable to the applicable Issuing Lender
in its sole discretion;

(v)           unless the Borrower
has delivered to the applicable Issuing Lender a completed and executed Letter
of Credit Application; provided that, if the terms of any Letter of Credit
Application conflicts with the terms of this Agreement, the terms of this
Agreement shall control;

(vi)          unless such Letter
of Credit is (A) governed by the Uniform Customs and Practice for Documentary
Credits (1993 Revision), International Chamber of Commerce Publication No. 500
or any successor to such publication, in case of a commercial letter of credit
and (B) the International Standby Practices 1998 published by the Institute of
International Banking Law & Practice (or such 

 18
 

 

later
version thereof as may be in effect at the time of issuance), in case of
standby letter of credit; and

(vii)         if such increase or extension relates
to an Existing Letter of Credit.

(c)     Requesting Letters of Credit.  Each Letter of Credit Extension shall be made
pursuant to a Letter of Credit Application, or if applicable, amendments to
such Letter of Credit Applications, given by the Borrower to the Administrative
Agent for the benefit of the applicable Issuing Lender by telecopy or in
writing not later than 11:00 a.m. (Houston, Texas, time) on the third Business
Day before the proposed date of the Letter of Credit Extension.  Each Letter of Credit Application, or if
applicable, amendments to such Letter of Credit Applications, shall be fully
completed and shall specify the information required therein.  Each Letter of Credit Application, or if
applicable, amendments to such Letter of Credit Applications, shall be
irrevocable and binding on the Borrower. 
Subject to the terms and conditions hereof, the applicable Issuing Lender
shall on the date of such Letter of Credit Extension, make such Letter of
Credit Extension to the beneficiary of such Letter of Credit.

(d)     Reimbursements for Letters of Credit; Funding of
Participations.  Upon receipt from the beneficiary of any Letter
of Credit of any notice of a drawing under such Letter of Credit with the
accompanying documentation required thereby, the applicable Issuing Lender
shall notify the Administrative Agent thereof. 
No later than 11:00 a.m. on the date of any payment to be made by such
Issuing Lender under a Letter of Credit, the Borrower agrees to pay to such
Issuing Lender an amount equal to any amount paid by such Issuing Lender under
or in respect of such Letter of Credit. 
In the event an Issuing Lender makes a payment pursuant to a request for
draw presented under a Letter of Credit and such payment is not promptly
reimbursed by the Borrower as required herein, such Issuing Lender shall give
notice of such payment to the Administrative Agent. In such event, the Borrower
shall be deemed to have requested a Base Rate Advance (notwithstanding any
minimum size or increment limitations on individual Advances).  Each Lender (including the Lender acting as
Issuing Lender) shall, upon notice from the Administrative Agent that the
Borrower has requested or is deemed to have requested an Advance pursuant to
Section 2.5 and regardless of whether (A) the conditions in Section 3.2 have
been met, (B) such notice complies with Section 2.5, or (C) a Default exists,
make funds available to the Administrative Agent for the account of the
applicable Issuing Lender in an amount equal to such Lender’s Applicable
Percentage of the amount of such Advance not later than 1:00 p.m. (Houston,
Texas, time) on the Business Day specified in such notice by the Administrative
Agent, whereupon (i) each Lender that so makes funds available shall be deemed
to have made a Base Rate Advance under to the Borrower in such amount.  The Administrative Agent shall remit the
funds so received to the applicable Issuing Lender.  If any such Lender shall not have so made
such Advance available to the Administrative Agent pursuant to this Section
2.3, such Lender agrees to pay interest thereon for each day from such date
until the date such amount is paid at the lesser of (A) the Overnight Rate for
such day for the first three days and thereafter the interest rate applicable
to such Base Rate Advances and (B) the Maximum Rate.  The Borrower hereby unconditionally and
irrevocably authorizes, empowers, and directs the Administrative Agent and the
Lenders to record and otherwise treat each payment under a Letter of Credit not
immediately reimbursed by the Borrower as a Revolving Borrowing comprised of
Base Rate Advances to the Borrower.  If
for any reason any payment pursuant to a request for draw presented under a
Letter of Credit is not refinanced by a Revolving Borrowing in accordance with
this Section 2.3(d), the Issuing Bank shall be deemed to have requested that
each of the applicable Lenders fund its risk participation in the relevant
Letter of Credit Obligations and each such Lender’s payment to the
Administrative Agent for the account of the Issuing Bank pursuant to this
Section 2.3(d) shall be deemed payment in respect of such participation.

(e)     Participations.  Upon the date of the issuance or increase of
a Letter of Credit or the deemed issuance of the Existing Letters of Credit
under Section 2.3(k), the applicable Issuing Lender shall be 

 19
 

 

deemed to have sold to each
other Lender and each other Lender shall have been deemed to have purchased
from the Issuing Lender a participation in the related Letter of Credit
Obligations equal to such Lender’s Applicable Percentage at such date and such
sale and purchase shall otherwise be in accordance with the terms of this Agreement.  The applicable Issuing Lender shall promptly
notify each such participant Lender by telex, telephone, or telecopy of each
Letter of Credit issued or increased and the actual dollar amount of such
Lender’s participation in such Letter of Credit.  Each Lender’s obligation to purchase
participating interests pursuant to this Section and to reimburse such Issuing
Lender for such Lender’s Applicable Percentage of any payment under a Letter of
Credit by such Issuing Lender not reimbursed in full by the Borrower shall be
absolute and unconditional and shall not be affected by any circumstance,
including (i) any of the circumstances described in paragraph (f) below, (ii)
the occurrence and continuance of a Default, (iii) an adverse change in the
financial condition of the Borrower or (iv) any other circumstance, happening
or event whatsoever, whether or not similar to any of the foregoing, except for
any such circumstance, happening or event constituting or arising from gross
negligence or willful misconduct on the part of the applicable Issuing Lender.

(f)      Obligations Unconditional.  The obligations of the Borrower under this
Agreement in respect of each Letter of Credit shall be unconditional and
irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement under all circumstances, notwithstanding the following circumstances:

(i)            any lack of
validity or enforceability of any Letter of Credit Documents;

(ii)           any amendment or
waiver of or any consent to departure from any Letter of Credit Document to
which the Borrower has consented;

(iii)          the existence of
any claim, set-off, defense or other right which any Credit Party may have at
any time against any beneficiary or transferee of such Letter of Credit (or any
Persons for whom any such beneficiary or any such transferee may be acting),
any Issuing Lender, any Lender or any other Person, whether in connection with
this Agreement, the transactions contemplated in this Agreement or in any
Letter of Credit Documents or any unrelated transaction;

(iv)          any statement or any
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 to the extent any Issuing Lender
would not be liable therefor pursuant to the following paragraph (h); or

(v)           any other
circumstance or happening whatsoever, whether or not similar to any of the
foregoing;

provided, however, that nothing contained in this
paragraph (f) shall be deemed to constitute a waiver of any remedies of the
Borrower in connection with the Letters of Credit, including those specified in
Section 2.3(h).

(g)     Cash Collateralization.  The Borrower shall deposit into the Cash
Collateral Account in accordance with paragraph (i) below cash in an amount
equal to 105% of the Letter of Credit Exposure of (i) each Letter of Credit
which has an expiration date beyond the Maturity Date, on or prior to the 90th day prior to the Maturity Date or (ii) all
outstanding Letters of Credit, if the Revolving Commitments are terminated in
whole pursuant to Section 2.1(b) or Article VII, on the date of such
termination.   If the Borrower has
deposited 105% of the Letter of Credit Exposure into the Cash Collateral
Account as of the Maturity Date and no other Default or Event of Default has
occurred and is continuing, each Lender’s obligation to purchase participating
interests pursuant to this Section and to reimburse such Issuing 

 20
 

 

Lender for such Lender’s
Applicable Percentage of any payment under a Letter of Credit by such Issuing
Lender not reimbursed in full by the Borrower shall be terminated as of the
Maturity Date.

(h)     Liability of Issuing Lenders.  The Borrower assumes all risks of the acts or
omissions of any beneficiary or transferee of any Letter of Credit with respect
to its or any Credit Party’s use of such Letter of Credit.  Neither Issuing Lender nor any of their
respective officers or directors shall be liable or responsible for:

(i)            the use which may
be made of any Letter of Credit or any acts or omissions of any beneficiary or
transferee in connection therewith;

(ii)           the validity,
sufficiency or genuineness of documents, or of any endorsement thereon, even if
such documents should prove to be in any or all respects invalid, insufficient,
fraudulent or forged; or

(iii)          any other
circumstances whatsoever in making or failing to make payment under any Letter
of Credit (INCLUDING AN ISSUING LENDER’S OWN
NEGLIGENCE),

except that the Borrower
shall have a claim against the applicable Issuing Lender, and the applicable
Issuing Lender shall be liable to, and shall promptly pay to, the Borrower, to
the extent of any direct, as opposed to consequential, damages suffered by the
Borrower which the Borrower proves were caused by (A) such Issuing Lender’s
willful misconduct or gross negligence in determining whether documents
presented under a Letter of Credit comply with the terms of such Letter of
Credit or (B) such Issuing Lender’s willful failure to make lawful payment
under any Letter of Credit after the presentation to it of a draft and
certificate strictly complying with the terms and conditions of such Letter of
Credit.   In furtherance and not in
limitation of the foregoing, the Issuing Lenders 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.

(i)      Cash Collateral Account.

(i)            If the Borrower is
required to deposit funds in the Cash Collateral Account pursuant to the terms
hereof, then the Borrower and the Administrative Agent shall establish the Cash
Collateral Account and the Borrower shall execute any documents and agreements,
including the Administrative Agent’s standard form assignment of deposit
accounts, that the Administrative Agent requests in connection therewith to
establish the Cash Collateral Account and grant the Administrative Agent a
first priority security interest in such account and the funds therein and
giving the Administrative Agent “control” over the Cash Collateral Account as
such term is defined in the applicable Uniform 
Commercial Code.  The Borrower
hereby pledges to the Administrative Agent and grants the Administrative Agent
a security interest in the Cash Collateral Account, whenever established, all
funds held in the Cash Collateral Account from time to time, and all proceeds
thereof as security for the payment of the Obligations.  Except as provided in Section 2.3(i)(ii)
below, the Borrower shall have no access and no rights of withdrawal from the
Cash Collateral Account.

(ii)           Funds held in the
Cash Collateral Accounts shall be held as cash collateral for obligations with
respect to Letters of Credit.  Such funds
shall be promptly applied by the Administrative Agent at the request of the applicable
Issuing Lender to any reimbursement or other obligations under the applicable
Letters of Credit that exist or occur. 
To the extent that any surplus funds are held in the Cash Collateral
Account above the Letter of Credit Exposure during the existence of an Event of
Default the Administrative Agent may (A) hold such surplus funds in the Cash
Collateral Account as cash collateral for the Obligations or (B) apply such
surplus funds to any Obligations in any manner 

 21
 

 

directed
by the Majority Lenders.  If no Default
exists, the Administrative Agent shall release to the Borrower at the Borrower’s
written request any funds held in the Cash Collateral Account in excess of 105%
of the then existing Letter of Credit Exposure. 
The Administrative Agent shall invest the funds in the Cash Collateral
Account in an interest-bearing account or other investment approved by the
Borrower.  The Administrative Agent shall
exercise reasonable care in the custody and preservation of any funds held in
the Cash Collateral Account and shall be deemed to have exercised such care if
such funds are accorded treatment substantially equivalent to that which the
Administrative Agent accords its own property or in accordance with the
Borrower’s instructions or as otherwise approved by the Borrower, it being
understood that the Administrative Agent shall not have any responsibility for
taking any necessary steps to preserve rights against any parties with respect
to any such funds.

(j)      Letters of Credit Issued for
Subsidiaries.  Notwithstanding that a
Letter of Credit issued or outstanding hereunder is in support of any
obligations of, or is for the account of, a Subsidiary of the Borrower, the
Borrower shall be obligated to reimburse the applicable Issuing Lender
hereunder for any and all drawings under such Letter of Credit issued (or
deemed issued) hereunder.  The Borrower
hereby acknowledges that the issuance of Letters of Credit for the account of
its Subsidiaries or any Subsidiary of the Parent inures to the benefit of the
Borrower, and that the Borrower’s business derives substantial benefits from
the businesses of such Subsidiaries.

(k)     Existing Letters of Credit. The
Issuing Lenders, the Lenders and the Borrower agree that effective as of the
Closing Date, the Existing Letters of Credit shall be deemed to have been
issued and maintained under, and to be governed by the terms and conditions of,
this Agreement.

Section 2.4            Swingline
Advances.

(a)     Commitment.  On the terms and conditions set forth in this
Agreement, the Swingline Lender agrees to, from time-to-time on any Business
Day from the Closing Date until the last Business Day occurring before the
Maturity Date, make Swingline Advances to the Borrower in an aggregate
principal amount not to exceed the Swingline Commitment at any time, provided
that (i) after giving effect to such Swingline Advance, the Outstandings shall
not exceed the aggregate Revolving Commitments in effect at such time, (ii) no
Swingline Advance may mature after the Maturity Date, and (iii) no Swingline
Advance shall be made by the Swingline Lender if the conditions set forth in
Section 3.2 have not been met as of the date of such Swingline Advance.  The Borrower agrees that the giving of the
applicable Notice of Borrowing and the acceptance by the Borrower of the
proceeds of such Swingline Advance shall constitute a representation and
warranty by the Borrower that on the date of such Swingline Advance the
conditions set forth in Section 3.2 have been met.  Immediately upon the making of a Swingline
Advance, each Lender shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from the Swingline Lender a risk
participation in such Swingline Advance in an amount equal to its Applicable
Percentage of such Swingline Advance.

(b)     Evidence of Indebtedness.  The indebtedness of the Borrower to the
Swingline Lender resulting from Swingline Advances shall be evidenced as set
forth in Section 2.2.

(c)     Prepayment.  Within the limits expressed in this
Agreement, amounts advanced pursuant to Section 2.4(a) may from time to time be
borrowed, prepaid without penalty, and reborrowed.  If the amount of aggregate outstanding amount
of Swingline Advances ever exceeds the Swingline Commitment, the Borrower
shall, upon receipt of written notice of such condition from the Swingline
Lender and to the extent of such excess, prepay to the Swingline Lender
outstanding principal of the Swingline Commitment such that such excess is
eliminated.

 22

 

(d)     Refinancing of Swingline Advances.

(i)            The Swingline
Lender at any time in its sole and absolute discretion may request, on behalf
of the Borrower (which hereby irrevocably authorizes the Swingline Lender to so
request on its behalf), that each Lender make a Base Rate Advance in an amount
equal to such Lender’s Applicable Percentage of the amount of Swingline
Advances then outstanding.  Such request
shall be made in writing (which written request shall be deemed to be a Notice
of Borrowing for purposes hereof), without regard to the minimum and multiples
specified in Section 2.5(c) for the principal amount of Revolving Borrowings
but subject to the unutilized portion of the Revolving Commitments and the
conditions set forth in Section 3.2.  The
Swingline Lender shall furnish the Borrower with a copy of the applicable
Notice of Borrowing promptly after delivering such notice to the Administrative
Agent.  Regardless of whether the request
for such Base Rate Advance complies with Section 2.5, each Lender shall make an
amount equal to its Applicable Percentage of the amount specified in such
Notice of Borrowing available to the Administrative Agent in Same Day Funds for
the account of the Swingline Lender at the Administrative Agent’s Lending
Office not later than 1:00 p.m. on the day specified in such Notice of
Borrowing, whereupon, subject to Section 2.4(d)(iii), each Lender that so makes
funds available shall be deemed to have made a Base Rate Advance to the
Borrower in such amount.  The
Administrative Agent shall remit the funds so received to the Swingline Lender.

(ii)           If for any reason
any Swingline Advance cannot be refinanced by such a Revolving Borrowing in
accordance with Section 2.4(d)(i), the applicable Notice of Borrowing submitted
by the Swingline Lender as set forth herein shall be deemed to be a request by
the Swingline Lender that each of the applicable Lenders fund its risk
participation in the relevant Swingline Advances and each such Lender’s payment
to the Administrative Agent for the account of the Swingline Lender pursuant to
Section 2.4(d)(i) shall be deemed payment in respect of such participation.

(iii)          If any Lender fails
to make available to the Administrative Agent for the account of the Swingline
Lender any amount required to be paid by such Lender pursuant to the foregoing
provisions of this Section 2.4(d) by the time specified in Section 2.4(d)(i),
the Swingline Lender shall be entitled to recover from such Lender (acting
through the Administrative Agent), on demand, such amount with interest thereon
for the period from the date such payment is required to the date on which such
payment is immediately available to the Swingline Lender at a rate per annum
equal to the applicable Overnight Rate from time to time in effect.  A certificate of the Swingline Lender
submitted to any Lender (through the Administrative Agent) with respect to any
amounts owing under this clause (iii) shall be conclusive absent manifest
error.

(iv)          Each Lender’s
obligation to make Advances or to purchase and fund risk participations in
Swingline Advances pursuant to this Section 2.4(d) 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 any Swingline Lender, the Borrower, or any other Person for any
reason whatsoever, (B) the occurrence or continuance of a Default, or (C) any
other occurrence, event or condition, whether or not similar to any of the
foregoing; provided, however, that each Lender’s obligation to
make Advances pursuant to Section 2.4(d)(i) is
subject to the conditions set forth in Section 3.2.  No such funding of risk participations shall
relieve or otherwise impair the obligation of the Borrower to repay the Swingline
Advances, together with interest as provided herein.

(e)     Repayment of Participations.

(i)            At any time after
any Lender has purchased and funded a risk participation in a Swingline
Advance, if the Swingline Lender receives any payment on account of such
Swingline Advance, the 

 23
 

 

Swingline
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 the Swingline Lender.

(ii)           If any payment
received by the Swingline Lender in respect of principal or interest on any
Swingline Advance is required to be returned by the Swingline Lender under any
of the circumstances described in Section 9.12 (including pursuant to any
settlement entered into by the Swingline Lender in its discretion), each Lender
shall pay to the Swingline Lender its Applicable Percentage thereof on demand
of the Administrative Agent, plus interest thereon from the date of such demand
to the date such amount is returned, at a rate per annum equal to the
applicable Overnight Rate.  The
Administrative Agent will make such demand upon the request of the Swingline
Lender.  The obligations of the Lenders
under this clause shall survive the payment in full of the Obligations and the
termination of this Agreement.

(f)      Interest for Account of Swingline
Lender.  The Swingline Lender shall
be responsible for invoicing the Borrower for interest on the Swingline
Advances.  Until each Lender funds its
Advances or risk participation pursuant to this Section to refinance such
Lender’s Applicable Percentage of the applicable Swingline Advances, interest
in respect of such Applicable Percentage shall be solely for the account of the
Swingline Lender.

(g)     Payments Directly to Swingline Lender.  The Borrower shall make all payments of
principal and interest in respect of the Swingline Advances directly to the
Swingline Lender.  

(h)     Method of Borrowing.  Except as
provided in the clause (c) above, each request for a Swingline Advance shall be
made pursuant to telephone notice to the Swingline Lender given no later than
11:00 a.m. (Houston, Texas time) on the date of the proposed Swingline Advance,
promptly confirmed by a completed and executed Notice of Borrowing facsimiled
to the Administrative Agent and the Swingline Lender.  The Swingline Lender will promptly make such
Swingline Advance available to the Borrower at the Borrower’s account with the
Administrative Agent.

Section 2.5            Borrowings;
Procedures and Limitations.

(a)     Notice of Borrowings.  Each
Revolving Borrowing shall be made pursuant to a Notice of Borrowing and given
by the Borrower to the Administrative Agent not later than 12:00 p.m. (Houston,
Texas time) on the third Business Day before the date of the proposed Revolving
Borrowing in the case of a Eurodollar Advance, and by the Borrower to the
Administrative Agent not later than 12:00 p.m. (Houston, Texas time) one
Business Day before the date of the proposed Revolving Borrowing in the case of
a Base Rate Advance.  The Administrative
Agent shall give each applicable Lender prompt notice on the day of receipt of
timely Notice of Borrowing of such proposed Revolving Borrowing by
facsimile.  Each Notice of Borrowing
shall be by facsimile specifying the (i) requested date of such Revolving
Borrowing (which shall be a Business Day), (ii) requested Type of Advances
comprising such Revolving Borrowing, (iii) aggregate amount of such Revolving
Borrowing, and (iv) if such Revolving Borrowing is to be comprised of
Eurodollar Advances, the Interest Period for such Advances.  In the case of a proposed Revolving Borrowing
comprised of Eurodollar Advances, the Administrative Agent shall promptly
notify each applicable Lender of the applicable interest rate under Section
2.9, as applicable.  Each Lender shall
before 11:00 a.m. (Houston, Texas time) on the date of the proposed Revolving
Borrowing, make available for the account of its Lending Office to the
Administrative Agent at its address referred to in Section 9.7, or such other
location as the Administrative Agent may specify by notice to the Lenders, in
Same Day Funds, such Lender’s Applicable Percentage of such Revolving
Borrowing.  Promptly upon the
Administrative Agent’s receipt of such funds (but in any event not later than
3:00 p.m. (Houston, Texas 

 24
 

 

time) on the date of the
proposed Revolving Borrowing) and provided that the applicable conditions set
forth in Article III have been satisfied, the Administrative Agent will make
such funds available to the Borrower at its account with the Administrative
Agent.

(b)     Conversions and Continuations. 
In order to elect to Convert or continue Advances comprising part of the
same Revolving Borrowing under this Section, 
the Borrower shall deliver an irrevocable Notice of Conversion or
Continuation to the Administrative Agent at the Administrative Agent’s office
no later than 12:00 p.m. (Houston, Texas time) (i) at least one Business
Day in advance of the proposed Conversion date in the case of a Conversion of
such Advances to Base Rate Advances, and (ii) at least three Business Days
in advance of the proposed Conversion or continuation date in the case of a
Conversion to, or a continuation of, Eurodollar Advances.  Each such Notice of
Conversion or Continuation shall be in writing or facsimile, specifying
(A) the requested Conversion or continuation date (which shall be a
Business Day), (B) the Revolving Borrowing amount and Type of the Advances
to be Converted or continued, (C) whether a Conversion or continuation is
requested, and if a Conversion, into what Type of Advances, and (D) in the
case of a Conversion to, or a continuation of, Eurodollar Advances, the
requested Interest Period.  Promptly
after receipt of a Notice of Conversion or Continuation under this paragraph,
the Administrative Agent shall provide each applicable Lender with a copy
thereof and, in the case of a Conversion to or a continuation of Eurodollar
Advances, notify each applicable Lender of the applicable interest rate under
Section 2.9 as applicable.  For purposes
other than the conditions set forth in Section 3.2, the portion of Advances
comprising part of the same Revolving Borrowing that are Converted to Advances
of another Type shall constitute a new Revolving Borrowing.

(c)     Certain Limitations. 
Notwithstanding anything in paragraphs (a) and (b) above:

(i)            Each Revolving
Borrowing shall (A) be in an aggregate amount not less than $3,000,000 and in
integral multiples of $1,000,000 in excess thereof in case of Eurodollar
Advances and in an aggregate amount not less than $500,000 and in integral
multiples of $100,000 in excess thereof in case of Base Rate Advances, (B)
consist of Advances of the same Type made, Converted or continued on the same
day by the Lenders according to their Applicable Percentage, and (C)
denominated only in Dollars.

(ii)           At no time shall
there be more than eight Interest Periods applicable to outstanding Eurodollar
Advances.

(iii)          The Borrower may
not select Eurodollar Advances for any Revolving Borrowing to be made,
Converted or continued if a Default or Event of Default has occurred and is
continuing.

(iv)          If any Lender shall,
at least one Business Day prior to the requested date of any Revolving
Borrowing comprised of Eurodollar Advances, notify the Administrative Agent and
the Borrower that the introduction of or any change in or in the interpretation
of any Legal Requirement makes it unlawful, or that any central bank or other
Governmental Authority asserts that it is unlawful, for such Lender or its
Lending Office to perform its obligations under this Agreement to make
Eurodollar Advances or to fund or maintain Eurodollar Advances, or any
Governmental Authority has imposed material restrictions on the authority of
such Lender to purchase or sell, or take deposits of, Dollars in the applicable
interbank market, then (1) such Lender’s Applicable Percentage of the amount of
such Revolving Borrowing shall be made as a Base Rate Advance of such Lender,
(2) such Base Rate Advance shall be considered part of the same Revolving
Borrowing and interest on such Base Rate Advance shall be due and payable at
the same time that interest on the Eurodollar Advances comprising the remainder
of such Revolving Borrowing shall be due and payable, and (3) any obligation of
such Lender to make, continue, or Convert to, Eurodollar Advances, including in
connection with such requested Revolving Borrowing, shall be suspended 

 25
 

 

until
such Lender notifies the Administrative Agent and the Borrower that the circumstances
giving rise to such determination no longer exist.

(v)           If the
Administrative Agent is unable to determine the Eurodollar Rate for Eurodollar
Advances comprising any requested Revolving Borrowing, the right of the
Borrower to select Eurodollar Advances for such Revolving Borrowing or for any
subsequent Revolving Borrowing shall be suspended until the Administrative
Agent shall notify the Borrower and the applicable Lenders that the
circumstances causing such suspension no longer exist, and each Revolving
Advance comprising such Revolving Borrowing shall be made as a Base Rate
Advance.

(vi)          If the Majority
Lenders shall, at least one Business Day before the date of any requested
Revolving Borrowing, notify the Administrative Agent that (A) the Eurodollar
Rate for Eurodollar Advances comprising such Revolving Borrowing will not
adequately reflect the cost to such Lenders of making or funding their
respective Eurodollar Advances, as the case may be, for such Revolving
Borrowing, or (B) deposits are not being offered to banks in the applicable
offshore interbank market for Dollars for the applicable amount and Interest
Period of such Eurodollar Advance, then the Administrative Agent shall give
notice thereof to the Borrower and the Lenders and the right of the Borrower to
select Eurodollar Advances for such Revolving Borrowing or for any subsequent
Revolving Borrowing shall be suspended until the Administrative Agent shall
notify the Borrower and the Lenders that the circumstances causing such suspension
no longer exist, and each Advance comprising such Revolving Borrowing shall be
made as a Base Rate Advance.

(vii)         If the Borrower
shall fail to select the duration or continuation of any Interest Period for
any Eurodollar Advance in accordance with the provisions contained in the
definition of “Interest Period” in Section 1.1 and paragraph (a) or (b)
above, the Administrative Agent will forthwith so notify the Borrower and the
applicable Lenders and such affected Advances will be made available to the Borrower
on the date of such Revolving Borrowing as Base Rate Advances or, if such
affected Advances are existing Advances, will be Converted into Base Rate
Advances at the end of Interest Period then in effect.

(viii)        Swingline Advances
may not be Converted or continued.

(d)     Notices Irrevocable.  Each Notice of Borrowing and Notice of
Conversion or Continuation shall be irrevocable and binding on the Borrower.

(e)     Lender Obligations Several.  The failure of any Lender to make the Advance
to be made by it as part of any Revolving Borrowing shall not relieve any other
Lender of its obligation, if any, to make its Advance on the date of such
Revolving Borrowing.  No Lender shall be
responsible for the failure of any other Lender to make the Advance to be made
by such other Lender on the date of any Revolving Borrowing.

(f)      Funding by Lenders; Administrative
Agent’ Reliance.  Unless the
Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Revolving Borrowing of Eurodollar Advances, or prior to
noon on the date of any Revolving Borrowing of Base Rate Advances, that such
Lender will not make available to the Administrative Agent such Lender’s share
of such Revolving Borrowing, the Administrative Agent may assume that such Lender
has made such share available in accordance with and at the time required in
Section 2.5 and may, in reliance upon such assumption, make available to the
Borrower a corresponding amount.  In such
event, if a Lender has not in fact made its share of the applicable Revolving
Borrowing available to the Administrative Agent, then the applicable Lender and
the Borrower severally agree to pay to the Administrative Agent forthwith on
demand such corresponding amount in Same Day Funds with interest thereon, for
each day from and including the date 

 26
 

 

such amount is made
available to the Borrower to but excluding the date of payment to the
Administrative Agent, at (A) in the case of a payment to be made by such
Lender, the Overnight Rate and (B) in the case of a payment to be made by the
Borrower, the interest rate applicable to the requested Revolving
Borrowing.  If the Borrower and such
Lender shall pay such interest to the Administrative Agent for the same or an
overlapping period, the Administrative Agent shall promptly remit to the
Borrower the amount of such interest paid by the Borrower for such period.  If such Lender pays its share of the
applicable Revolving Borrowing to the Administrative Agent, then the amount so paid
shall constitute such Lender’s Advance included in such Revolving
Borrowing.  Any payment by the Borrower
shall be without prejudice to any claim the Borrower may have against a Lender
that shall have failed to make such payment to the Administrative Agent.  A notice of the Administrative Agent to any
Lender or Borrower with respect to any amount owing under this subsection (f)
shall be conclusive, absent manifest error.

Section 2.6            Prepayments.  No Borrower shall have any right to prepay
any principal amount of any Advance except as provided in this Section 2.6.

(a)     Optional.  The Borrower may elect to prepay any Revolving Borrowing, in whole or in part, without
penalty or premium except as set forth in Section 2.11 and after giving by
11:00 a.m. (Houston, Texas time) (i) in the case of Eurodollar
Advances, at least three Business Days’ or (ii) in case of Base Rate
Advances, one Business Day’s prior written notice to the Administrative Agent
stating the proposed date and aggregate principal amount of such
prepayment.  If any such notice is given,
the Borrower shall prepay Advances comprising part of the same Revolving Borrowing in whole or ratably in part in
an aggregate principal amount equal to the amount specified in such notice,
together with accrued interest to the date of such prepayment on the principal
amount prepaid and amounts, if any, required to be paid pursuant to
Section 2.11 as a result of such prepayment being made on such date; provided
that each optional partial prepayment of a Revolving Borrowing shall be in a minimum amount not
less than $3,000,000 and in multiple integrals of $1,000,000 in excess thereof.

(b)     Mandatory. 
(i) On any date that Outstandings exceeds the aggregate amount of
Revolving Commitments, the Borrower shall, within one Business Day, to the
extent of such excess, first prepay to the Swingline Lender the outstanding
principal amount of the Swingline Advances, second, prepay to the Lenders on a
pro rata basis the outstanding principal amount of the Revolving Advances and
third, make deposits into the Cash Collateral Account to provide cash
collateral in the amount of such excess for the Letter of Credit Exposure. (ii)
If a Commitment Increase is effected as permitted under Section 2.1(c),
the Borrower shall prepay any Revolving Advances outstanding on such Increase
Date to the extent necessary to keep the outstanding Revolving Advances ratable
to reflect the revised Applicable Percentages arising from such Commitment
Increase.  Any prepayment made by
Borrower in accordance with this clause (b)(ii) may be made with the proceeds
of Revolving Advances made by all the Lenders in connection the Commitment
Increase occurring simultaneously with the prepayment.

(c)     Interest; Costs.  Each prepayment pursuant to this Section 2.6
shall be accompanied by accrued interest on the amount prepaid to the date of
such prepayment and amounts, if any, required to be paid pursuant to Section
2.11 as a result of such prepayment being made on such date.

Section 2.7            Repayment.

(a)     Revolving Advances.  The Borrower hereby unconditionally promises
to pay to the Administrative Agent for the account of and ratable benefit of
each Lender the aggregate outstanding principal amount of all Revolving
Advances on the Maturity Date.

(b)     Swingline Advances.  The Borrower hereby unconditionally promises
to pay to the Swingline Lender (i) the aggregate outstanding principal amount
of all Swingline Advances on each Swingline 

 27
 

 

Payment Date, and (ii) the
aggregate outstanding principal amount of all Swingline Advances outstanding on
the Maturity Date.

Section 2.8            Fees.

(a)     Commitment Fees.  The Borrower agrees to pay to the
Administrative Agent for the account of each Lender a Commitment Fee on the
average daily amount by which such Lender’s Revolving Commitment exceeds such
Lender’s outstanding Revolving Advances plus such Lender’s Applicable
Percentage of the Letter of Credit Exposure at the per annum rate equal to the
Applicable Margin for Commitment Fees for such period.  The Commitment Fee is due quarterly in
arrears on March 31, June 30, September 30, and December 31 of each year
commencing on December 31, 2006, and on the Maturity Date.  For purposes of this Section 2.8(a) only,
amounts advanced as Swingline Advances shall not reduce the amount of the
unused Revolving Commitment.

(b)     Fees for Letters of Credit.  The Borrower agrees to pay the following: (i)
to the Administrative Agent for the pro rata benefit of the Lenders a per annum
letter of credit fee for each Letter of Credit issued hereunder in an amount
equal to the Applicable Margin for Eurodollar Advances on the face amount of
such Letter of Credit for the period such Letter of Credit is outstanding,
which fee shall be due and payable quarterly in arrears on March 31, June 30,
September 30, and December 31 of each year, and on the Maturity Date; (ii) to
the Issuing Lender, a fronting fee for each Letter of Credit equal to the
greater of (A) .075% per annum on the face amount of such Letter of Credit (and
in the case of an increase, on the amount of such increase) and (B) $600.00,
which fee shall be due and payable annually in advance on the date of the
issuance or increase of each Letter of Credit and on the earlier of each annual
anniversary thereafter or the Maturity Date; and (iii) to the Issuing Lender
such other usual and customary fees associated with any transfers, amendments,
drawings, negotiations or reissuances of any Letter of Credit, which fees shall
be due and payable as requested by the Issuing Lender in accordance with the
Issuing Lender’s then current fee policy. 
The Borrower shall have no right to any refund of letter of credit fees
previously paid by the Borrower, including any refund claimed because the
Borrower cancels any Letter of Credit prior to its expiration date.

(c)     Administrative Agent Fee.  The Borrower agrees to pay the fees to the
Administrative Agent as set forth in the Fee Letter.

Section 2.9            Interest.

(a)     Base Rate Advances.  Each Base Rate Advance shall bear interest at
the Adjusted Base Rate in effect from time to time plus the Applicable
Margin for Base Rate Advances for such period, provided that while an
Event of Default is continuing the Base Rate Advances shall bear interest at
the Adjusted Base Rate in effect from time to time plus the Applicable
Margin plus 2%.  The Borrower
shall pay to Administrative Agent for the ratable benefit of each Lender all
accrued but unpaid interest on such Lender’s Base Rate Advances on each March
31, June 30, September 30, and December 31 commencing on December 31, 2006, and
on the Maturity Date; provided that if an Event of Default is
continuing, interest shall be payable on demand.

(b)     Eurodollar Advances.  Each Eurodollar Advance shall bear interest
during its Interest Period equal to at all times the Eurodollar Rate for such
Interest Period plus the Applicable Margin for Eurodollar Advances for
such period; provided that while an Event of Default is continuing, each
Eurodollar Advance shall bear interest at the Eurodollar Rate in effect from
time to time plus the Applicable Margin plus 2%.  The Borrower shall pay to the Administrative
Agent for the ratable benefit of each Lender all accrued but unpaid interest on
each of such Lender’s Eurodollar Advances on the last day of the Interest
Period therefor (provided that for Eurodollar Advances with six month Interest
Periods, 

 28
 

 

accrued but unpaid interest
shall also be due on the day three months from the first day of such Interest
Period), on the date any Eurodollar Advance is repaid in full, and on the
Maturity Date; provided that if an Event of Default is continuing,
interest shall be payable on demand.

(c)   Swingline Advances.  Swingline Advances shall bear interest at the
Adjusted Base Rate in effect from time to time plus the Applicable Margin for
Base Rate Advances; provided that while an Event of Default is
continuing the Swingline Advances shall bear interest at the Adjusted Base Rate
in effect from time to time plus the Applicable Margin for Base Rate
Advances plus 2%.  The Borrower
shall pay to the Swingline Lender for its own account subject to Section 2.4(f)
all accrued but unpaid interest on each Swingline Advance on each Swingline
Payment Date, on the date any Swingline Advance is repaid (or refinanced) in
full, and on the Maturity Date.

(d)   Other Amounts Overdue.  If any amount payable under this Agreement
other than the Advances is not paid when due and payable, including accrued
interest and fees, then such overdue amount shall accrue interest hereon due
and payable on demand at a rate per annum equal to the lesser of (i) Adjusted
Base Rate plus two percent (2%) and (ii) the Maximum Rate, from the date
such amount became due until the date such amount is paid in full.

Section
2.10         Illegality.  If any Lender shall notify the Borrower that
the introduction of or any change in or in the interpretation of any law or
regulation makes it unlawful, or that any central bank or other governmental
authority asserts that it is unlawful, for such Lender or its Lending Office to
perform its obligations under this Agreement to make, maintain, or fund any
Eurodollar Advances of such Lender then outstanding hereunder, (a) the
Borrower shall, no later than 11:00 a.m. (Houston, Texas, time) (i) if not
prohibited by law, on the last day of the Interest Period for each outstanding
Eurodollar Advance, or (ii) if required by such notice, on the second
Business Day following its receipt of such notice, prepay all of the Eurodollar
Advances of such Lender then outstanding, together with accrued interest on the
principal amount prepaid to the date of such prepayment and amounts, if any,
required to be paid pursuant to Section 2.11 as a result of such prepayment
being made on such date, (b) such Lender shall simultaneously make a Base
Rate Advance to the Borrower on such date in an amount equal to the aggregate
principal amount of the Eurodollar Advances prepaid to such Lender, and
(c) the right of the Borrower to select Eurodollar Advances from such
Lender for any subsequent Revolving Borrowing shall be suspended until such
Lender shall notify the Borrower that the circumstances causing such suspension
no longer exist.

Section 2.11         Breakage
Costs.

(a)     Funding Losses.  In the case of any Revolving Borrowing which
the related Notice of Borrowing specifies is to be comprised of Eurodollar
Advances, the Borrower hereby indemnifies each Lender against any loss,
out-of-pocket cost, or expense incurred by such Lender as a result of any
failure to fulfill on or before the date specified in such Notice of Borrowing
for such Revolving Borrowing the applicable conditions set forth in Article
III, including, without limitation, any loss (excluding any loss of anticipated
profits), cost, or expense incurred by reason of the liquidation or
redeployment of deposits or other funds acquired by such Lender to fund the
Eurodollar Advance to be made by such Lender as part of such Revolving
Borrowing when such Eurodollar Advance as a result of such failure, is not made
on such date.

(b)     Prepayment Losses.  If (i) any payment of principal of any
Eurodollar Advance is made other than on the last day of the Interest Period for
such Advance as a result of any prepayment, payment pursuant to Section 2.6,
the acceleration of the maturity of the Obligations, or for any other reason,
(ii) the Borrower fails to make a principal or interest payment with
respect to any Eurodollar Advance on the date such payment is due and payable,
or (iii) any failure by the Borrower to make payment of any Advance or
reimbursement of drawing under any Letter of Credit (or interest due thereon)
on its scheduled due date; 

 29
 

 

the Borrower shall, within 10
days of any written demand sent by the Administrative Agent on behalf of a
Lender to the Borrower, pay to the Administrative Agent for the benefit of such
Lender any amounts determined in good faith by such Lender to be required to
compensate such Lender for any additional losses, out-of-pocket
costs, or expenses which it may reasonably incur as a result of such payment or
nonpayment, including, without limitation, any loss (excluding loss of
anticipated profits), cost, or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by any Lender to fund or
maintain such Advance.

Section 2.12         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 contemplated by Section 2.12(e)) or any Issuing Lender;

(ii)           subject any Lender
or Issuing Lender to any tax of any kind whatsoever with respect to this
Agreement, any Letter of Credit, any participation in a Letter of Credit, any
Eurodollar Advance made by it, or change the basis of taxation of payments to
such Lender or Issuing Lender in respect thereof (except for Indemnified Taxes
or Other Taxes covered by Section 2.14 and the imposition of, or any change in
the rate of, any Excluded Tax payable by such Lender or Issuing Lender); or

(iii)          impose on any
Lender or Issuing Lender or the London interbank market any other condition,
cost or expense affecting this Agreement or Eurodollar Advances 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 Advance (or of maintaining
its obligation to make or accept and purchase any such Advance), or to increase
the cost to such Lender or Issuing Lender 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 Issuing Lender hereunder
(whether of principal, interest or any other amount) then, upon request of such
Lender or Issuing Lender, the Borrower will pay to such Lender or Issuing
Lender, such additional amount or amounts as will compensate such Lender or
Issuing Lender, as the case may be, for such additional costs incurred or
reduction suffered.

(b)     Capital Adequacy.  If any Lender or Issuing Lender determines
that any Change in Law affecting such Lender or Issuing Lender or any lending
office of such Lender or such Lender’s or Issuing Lender’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 Issuing Lender’s capital or on the
capital of such Lender’s or Issuing Lender’s holding company, if any, as a
consequence of this Agreement, the Commitments of such Lender or the Advances
made by, or participations in Letters of Credit held by, such Lender, or the
Letters of Credit issued by such Issuing Lender, to a level below that which
such Lender or Issuing Lender or such Lender’s or Issuing Lender’s holding
company could have achieved but for such Change in Law (taking into
consideration such Lender’s or Issuing Lender’s policies and the policies of
such Lender’s or Issuing Lender’s holding company with respect to capital adequacy),
then from time to time the Borrower will pay to such Lender or Issuing Lender,
such additional amount or amounts as will compensate such Lender or such
Issuing Lender or such Lender’s or Issuing Lender’s holding company for any
such reduction suffered.

 30
 

 

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

(d)     Delay in Requests.  Failure or delay on the part of any Lender or
Issuing Lender to demand compensation pursuant to this Section shall not
constitute a waiver of such Lender’s or such Issuing Lender’s right to demand
such compensation.

(e)     Additional Reserve Requirement.  The Borrower shall pay to each Lender Party,
(i) as long as such Lender Party shall be required to maintain reserves with
respect to liabilities or assets consisting of or including Eurodollar funds or
deposits (currently known as Eurocurrency Liabilities), additional interest on
the unpaid principal amount of each Eurodollar Advance equal to the actual
costs of such reserves allocated to such Advance by such Lender Party (as
determined by such Lender Party in good faith, which determination shall be
conclusive in the absence of manifest error), and (ii) as long as such Lender
Party shall be required to comply with any reserve ratio requirement or
analogous requirement of any other central banking or financial regulatory
authority imposed in respect of the maintenance of the Commitments or the
funding of the Eurodollar Advances, such additional costs (expressed as a
percentage per annum and rounded upwards, if necessary, to the nearest five
decimal places) equal to the actual costs allocated to such Commitments or
Advances by such Lender Party (as determined by such Lender Party in good
faith, which determination shall be conclusive in the absence of manifest
error), which in each case, shall be due and payable on each date on which
interest is payable on such Advance.

Section 2.13         Payments
and Computations.

(a)     Payments.  All payments to be made by the Borrower shall
be made without condition or deduction for any counterclaim, defense,
recoupment or setoff.   Except as
otherwise expressly provided herein, all payments by the Borrower hereunder
shall be made to the Administrative Agent, for the account of the respective
Lenders to which such payment is owed in Dollars and in Same Day Funds.  Subject to Section 2.5(c), each payment of
any Advance pursuant to this Section or any other provision of this Agreement
shall be made in a manner such that all Advances comprising part of the same
Revolving Borrowing are paid in whole or ratably in part.

(b)     Payments by Borrower; Presumptions by
Administrative Agent.  Unless the
Administrative Agent shall have received notice from the Borrower prior to the
date on which any payment is due to the Administrative Agent for the account of
the applicable Lenders or the Issuing Lenders hereunder that the Borrower will
not make such payment, the Administrative Agent may assume that the Borrower
has made such payment on such date in accordance herewith and may, in reliance
upon such assumption, distribute to the Lenders or the Issuing Lenders, as the
case may be, the amount due.  In such
event, if the Borrower has not in fact made such payment, then each of the
applicable Lenders or the Issuing Lenders, as the case may be, severally agrees
to repay to the Administrative Agent forthwith on demand the amount so distributed
to such Lender or Issuing Lender, in Same Day Funds with interest thereon, for
each day from and including the date such amount is distributed to it to but
excluding the date of payment to the Administrative Agent, at the Overnight
Rate.  A notice of the Administrative
Agent to any Lender or Borrower with respect to any amount owing under this
subsection (b) shall be conclusive, absent manifest error.

(c)     Payment Procedures. The Borrower
shall make each payment of any amount under this Agreement and under any other
Credit Document not later than 11:00 a.m. (Houston, Texas time) on the day
when due to the Administrative Agent at the Administrative Agent’s address (or
such other location 

 31
 

 

as the Administrative Agent
shall designate in writing to the Borrower) in Same Day Funds.  Without limiting the generality of the
foregoing, the Administrative Agent may require that any payments due under
this Agreement be made in the United States. 
The Administrative Agent will promptly thereafter, and in any event prior
to the close of business on the day any timely payment is made, cause to be
distributed like funds relating to the payment of principal, interest or fees
ratably (other than amounts payable solely to any specific Lender Party
pursuant to Sections 2.4, 2.10, 2.11, 2.12, 2.14, and 9.1 but after taking into
account payments effected pursuant to Section 2.13(f)) in accordance with each
Lender’s Applicable Percentage to the Lenders for the account of their
respective Lending Offices, and like funds relating to the payment of any other
amount payable to any Lender to such Lender for the account of its Lending
Office, in each case to be applied in accordance with the terms of this
Agreement.  Upon receipt of other amounts
due solely to the Administrative Agent, Issuing Lender, Swingline Lender, or a
specific Lender, the Administrative Agent shall distribute such amounts to the
appropriate party to be applied in accordance with the terms of this Agreement.

(d)     Non-Business Day Payments.  Whenever any payment shall be stated to be
due on a day other than a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or fees, as the case may be;
provided that if such extension would cause payment of interest on or
principal of Eurodollar Advances to be made in the next following calendar
month, such payment shall be made on the next preceding Business Day.

(e)     Computations.  All computations of interest and fees shall
be made by the Administrative Agent on the basis of a year of 365/366 days for
Base Rate Advances and a year of 360 days for all other interest and fees, in
each case for the actual number of days (including the first day, but excluding
the last day) occurring in the period for which such interest or fees are
payable.  Each determination by the
Administrative Agent of an amount of interest or fees shall be conclusive and
binding for all purposes, absent manifest error.

(f)      Sharing of Payments, Etc.  Each Lender agrees that if it shall, through
the exercise of a right of banker’s lien, setoff, counterclaim or otherwise
against the Borrower or any other Credit Party, obtain payment (voluntary or
involuntary) in respect of any Advance or the participations in the Letter of
Credit Obligations or in the Swingline Advances held by it, as a result of
which the unpaid portion of its Advances shall be proportionately less than the
unpaid portion of the Advances or the participations in the Letter of Credit
Obligations or in the Swingline Advances held by any other Lender, it shall be
deemed simultaneously to have purchased from such other Lender at face value,
and shall promptly pay to such other Lender the purchase price for, a
participation in the Advances, the participations in the Letter of Credit
Obligations and in the Swingline Advances held by it of such other Lender, so
that the aggregate unpaid amount of the Advances and participations in
Advances, Letter of Credit Obligations and Swingline Advances held by each
Lender shall be in the same proportion to the aggregate unpaid amount of all
Advances, Letter of Credit Obligations and Swingline Advances then outstanding
as the amount of its Advances, and participations in Letter of Credit Obligations
and Swingline Advances prior to such exercise of banker’s lien, setoff or
counterclaim or other event was to the amount of all Advances and
participations in Letter of Credit Obligations and Swingline Advances,
outstanding prior to such exercise of banker’s lien, setoff or counterclaim or
other event; provided, however, that if any such purchase or purchases or
adjustments shall be made pursuant to this Section 2.13 and the payment giving
rise thereto shall thereafter be recovered, such purchase or purchases or
adjustments shall be rescinded to the extent of such recovery and the purchase
price or prices or adjustment restored without interest.  The Borrower 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 the Borrower rights of setoff and counterclaim with respect to
such participation as fully as if such Lender were a direct creditor of the
Borrower in the amount of such participation.

 32
 

 

Section 2.14         Taxes. 
Any and all payments by or on account of any obligation of the Borrower
or any Guarantor hereunder or under any other Credit Document shall be made
free and clear of and without reduction or withholding for any Indemnified
Taxes or Other Taxes, provided that if the Borrower shall be required by
applicable law to deduct any Indemnified Taxes (including any Other Taxes) from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent, Lender or
Issuing Lender, as the case may be, receives an amount equal to the sum it
would have received had no such deductions been made, (ii) the Borrower shall
make such deductions and (iii) the Borrower shall timely pay the full amount
deducted to the relevant Governmental Authority in accordance with applicable
law.

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

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

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

(d)   Status of Lenders.

(i)            Any Foreign Lender
that is entitled to an exemption from or reduction of withholding tax under the
law of the jurisdiction in which the Borrower is resident for tax purposes, or
any treaty to which such jurisdiction is a party, with respect to payments
hereunder or under any other Credit Document shall deliver to the Borrower
(with a copy to the Administrative Agent), prior to the Closing Date (or upon
becoming a Lender by assignment or participation) and at any time or times prescribed
by applicable law or reasonably requested by the Borrower or the Administrative
Agent, such properly completed and executed documentation prescribed by
applicable law as will permit such payments to be made without withholding or
at a reduced rate of withholding.  In
addition, any Lender, if requested by the Borrower or the Administrative Agent,
shall deliver such other documentation prescribed by applicable law or
reasonably requested by the Borrower or the Administrative Agent as will enable
the Borrower or the Administrative Agent to determine whether or not such
Lender is subject to backup withholding or information reporting requirements.

(ii)           Without limiting
the generality of the foregoing, in the event that the Borrower is resident for
tax purposes in the United States, any Foreign Lender shall deliver to the
Borrower and the 

 33
 

 

Administrative
Agent (in such number of copies as shall be requested by the recipient) on or
prior to the date on which such Foreign Lender becomes a Lender under this Agreement
(and from time to time thereafter upon the request of the Borrower or the
Administrative Agent, but only if such Foreign Lender is legally entitled to do
so), whichever of the following is applicable:

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

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

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

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

(iii)          Without limiting
the obligations of the Lenders set forth above regarding delivery of certain
forms and documents to establish each Lender’s status for U.S. withholding tax
purposes, each Lender agrees promptly to deliver to the Administrative Agent or
the Borrower, as the Administrative Agent or the Borrower shall reasonably
request, on or prior to the Closing Date, and in a timely fashion thereafter,
such other documents and forms required by any relevant taxing authorities
under any Legal Requirement of any other jurisdiction, duly executed and
completed by such Lender, as are required under such Legal Requirements to
confirm such Lender’s entitlement to any available exemption from, or reduction
of, applicable withholding taxes in respect of all payments to be made to such
Lender outside of the U.S. by the Borrower pursuant to this Agreement or
otherwise to establish such Lender’s status for withholding tax purposes in
such other jurisdiction.

(iv)          Each Lender shall
promptly (i) notify the Administrative Agent of any change in circumstances
which would modify or render invalid any such 
claimed exemption or reduction, and (ii) take such steps as shall not be
materially disadvantageous to it, in the reasonable judgment of such Lender,
and as may be reasonably necessary (including the re-designation of its Lending
Office) to avoid any requirement of applicable Legal Requirements of any such
jurisdiction that the Borrower make any deduction or withholding for taxes from
amounts payable to such Lender. 
Additionally, the Borrower shall promptly deliver to the Administrative
Agent or any Lender, as the Administrative Agent or such Lender shall
reasonably request, on or prior to the Closing Date, and in a timely fashion
thereafter, such documents and forms required by any relevant taxing
authorities under the Laws of any jurisdiction, duly executed and completed by
the Borrower, as are required to be furnished by such Lender or the
Administrative Agent under such Laws in connection with any payment by the
Administrative Agent or any Lender of Taxes or Other Taxes, or otherwise in
connection with the Credit Documents, with respect to such jurisdiction.

(e)     Treatment of Certain Refunds.  If any Lender Party determines, in its sole
discretion, that it has received a refund of any Taxes or Other Taxes as to
which it has been indemnified by the Borrower or 

 34
 

 

with respect to which the
Borrower has paid additional amounts pursuant to this Section,  it shall pay to the Borrower an amount equal
to such refund (but only to the extent of indemnity payments made, or
additional amounts paid, by the Borrower under this Section with respect to the
Taxes or Other Taxes giving rise to such refund), net of all out-of-pocket
expenses of the Administrative Agent, such Lender or such Issuing Lender, as
the case may be, and without interest (other than any interest paid by the
relevant Governmental Authority with respect to such refund), provided
that the Borrower, upon the request of the Administrative Agent, such Lender or
such Issuing Lender, agrees to repay the amount paid over to the Borrower (plus
any penalties, interest or other charges imposed by the relevant Governmental
Authority) to the Administrative Agent, such Lender or such Issuing Lender in
the event the Administrative Agent, such Lender or such Issuing Lender is
required to repay such refund to such Governmental Authority.  This subsection shall not be construed to
require any Lender Party 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.

Section
2.15         Mitigation Obligations.  If any Lender requests compensation under
Section 2.12, or requires the Borrower to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 2.14, or suspends its obligation to continue, or Convert Advances into,
Eurodollar Advances pursuant to Section 2.5(c)(iv) or Section 2.10, then such
Lender (an “Affected Lender”) shall use reasonable efforts to designate
a different lending office for funding or booking its Credit Extensions
hereunder or to assign its rights and obligations hereunder to another of its
offices, branches or affiliates, if, in the reasonable judgment of such
Affected Lender, such designation or assignment (i) would eliminate or
reduce amounts payable pursuant to Section 2.12 or 2.14, as the case may
be, in the future or if applicable, would avoid the effect of Section 2.5(c)(iv)
or Section 2.10, (ii) would not subject such Affected Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such
Affected Lender.  The Borrower hereby
agrees to pay all costs and expenses incurred by any Lender in connection with
any such designation or assignment. 
Further, in the event of any such circumstances Borrower shall have the
right to replace the Affected Lender with one or more Eligible Assignees in
which event, not later than 30 Business Days after notice to the Administrative
Agent and the Affected Lender designating the Eligible Assignee or Assignees
and the percentage interest in the Affected Lender’s interest to be assigned to
each Eligible Assignee or Assignees, (i) the Affected Lender and the designated
Eligible Assignee or Assignees shall enter into an Assignment and Assumption
Agreement and otherwise conclude such assignment in accordance with the
provisions of Section 9.6(a), and (ii) each Eligible Assignee shall remit to
the Affected Lender, in immediately available funds, an amount equal to the
product of (a) the percentage interest of the Affected Lender’s interest being
assigned and (b) the outstanding principal, accrued interest, fees and other
Obligations owed by the Borrower to the Affected Lender hereunder.

ARTICLE
III

CONDITIONS PRECEDENT

Section
3.1            Conditions Precedent to
Initial Credit Extension.  The obligation of each Issuing Lender, the
Swingline Lender and each Lender to make its initial Credit Extension hereunder
(including a deemed issuance of an Existing Letter of Credit) is subject to
satisfaction of the following conditions precedent:

(a)   Documentation.  The Administrative Agent shall have received
the following, duly executed by all the parties thereto, in form and substance
reasonably satisfactory to the Administrative Agent and the Lenders:

(i)            this Agreement and
all attached Exhibits and Schedules;

(ii)           the Notes payable
to the order of each Lender, as requested by such Lender;

 35
 

 

(iii)          the Guaranty;

(iv)          a certificate from a
Responsible Officer of the Borrower dated as of the date hereof stating that as
of such date (A) all representations and warranties of the Credit Parties
set forth in this Agreement are true and correct in all material respects and
(B) no Default has occurred and is continuing;

(v)           a secretary’s
certificate from each Credit Party certifying such Person’s (A) officers’
incumbency, (B) authorizing resolutions, and (C) organizational documents;

(vi)          certificates of good
standing for each Credit Party in (a) the state, province or territory in which
each such Person is organized and (b) each state, province or territory in
which such good standing is necessary except where the failure to be in good
standing could not reasonably be expected to result in a Material Adverse
Change, which certificates shall be dated a date not earlier than 60 days prior
to date hereof;

(vii)         an Oklahoma law
legal opinion of McAfee & Taft, outside counsel to the Credit Parties, in
form and substance reasonably acceptable to the Administrative Agent;

(viii)        a legal opinion of
Steven R. Mackey, General Counsel of the Parent, in form and substance
reasonably acceptable to the Administrative Agent; and

(ix)           such other
documents, governmental certificates, and agreements as any Lender Party may
reasonably request.

(b)     Representations and Warranties.  The representations and warranties contained
in Article IV and in each other Credit Document shall be true and correct on
and as of the Closing Date before and after giving effect to the initial
Revolving Borrowings or issuance (or deemed issuance) of Letters of Credit, as
though made on and as of such date.

(c)     No Default.  No Default shall have occurred and be
continuing.

(d)     Payment of Fees.  The Borrower shall have paid the fees and
expenses required to be paid as of the Closing Date by Section 9.1 and the Fee Letter.

(e)     Other Proceedings.  No action, suit, investigation or other
proceeding (including, without limitation, the enactment or promulgation of a
statute or rule) by or before any arbitrator or any Governmental Authority
shall be threatened or pending and no preliminary or permanent injunction or
order by a state or federal court shall have been entered (i) in connection
with this Agreement or any transaction contemplated hereby or (ii) which, in
any case, in the judgment of the Administrative Agent could reasonably be
expected to result in a Material Adverse Change.

(f)      Material Adverse Change.  Except as set forth on Schedule 3.1(f),
no event or circumstance that could reasonably be expected to result in a
material adverse change in the business, condition (financial or otherwise),
prospects, or results of operations of the Parent and its Subsidiaries, taken
as a whole, shall have occurred since December 31, 2005.

(g)     Solvency.  The Administrative Agent shall have received
a certificate in form and substance reasonably satisfactory to the
Administrative Agent from a senior financial officer of the Parent certifying
that, before and after giving effect to the initial Revolving Borrowings made
hereunder, each Credit Party is Solvent.

 36
 

 

(h)     Notice of Borrowing.  The Administrative Agent shall have received
a Notice of Borrowing from the Borrower, with appropriate insertions and
executed by a duly authorized officer of the Borrower.

(i)      Existing Credit Agreement.  The Administrative Agent shall have received
evidence that the Revolving Commitment (as defined in the Existing Credit
Agreement) has been or concurrently with the Closing Date is being reduced to
$5,000,000.

Section
3.2            Conditions Precedent to
Each Credit Extension.  The
obligation of each Lender to make any Credit Extension on the occasion of each
Revolving Borrowing (including the initial Revolving Borrowing), the obligation
of each Issuing Lender to make any Credit Extension (including the deemed
issuance of the Existing Letters of Credit) and the obligation of the Swingline
Lender to make Swingline Advances, in any such case, shall be subject to the
further conditions precedent that on the date of such Revolving Borrowing or such
Credit Extension:

(a)     Representations and Warranties.  As of the date of the making of such Credit
Extension, the representations and warranties made by any Credit Party in the
Credit Documents shall be true and correct in all material respects on such
date, except that any representation and warranty which by its terms is made as
of a specified date shall be required to be true and correct only as of such
specified date and each request for the making of any Credit Extension and the
making of such Credit Extension shall be deemed to be a reaffirmation of such
representations and warranties.

(b)     Event of Default.  As of the date of the Credit Extension, there
shall exist no Default or Event of Default, and the making of such Credit
Extension would not cause a Default or Event of Default.

ARTICLE
IV

REPRESENTATIONS AND WARRANTIES

The
Parent and the Borrower each hereby represents and warrants as follows:

Section
4.1            Organization.  Each of the Parent and its Subsidiaries is
duly and validly organized and existing and in good standing under the laws of
its jurisdiction of incorporation or formation and is authorized to do business
and is in good standing in all jurisdictions in which such qualifications or
authorizations are necessary except where the failure could not reasonably be
expected to result in a Material Adverse Change.

Section
4.2            Authorization.  The execution, delivery, and performance by
each Credit Party of each Credit Document to which such Credit Party is a party
and the consummation of the transactions contemplated thereby (a) are
within such Credit Party’s powers, (b) have been duly authorized by all
necessary corporate, limited liability company or partnership action,
(c) do not contravene any organizational documents of such Credit Party, (d)
do not contravene any law or any contractual restriction binding on or
affecting such Credit Party, (e) do not result in or require the creation
or imposition of any Lien prohibited by this Agreement, and (f) do not require
any authorization or approval or other action by, or any notice or filing with,
any Governmental Authority, except notices to or filings with the SEC that may
be required from time to time.  At the
time of each Credit Extension, such Credit Extension and the use of the
proceeds of such Credit Extension are within the Borrower’s corporate powers,
are been duly authorized by all necessary corporate action, don’t contravene
(i) the Borrower’s organizational documents or (ii) any law or any
contractual restriction binding on or affecting the Borrower, will not result
in or require the creation or imposition of any Lien prohibited by this
Agreement, and do not require any authorization or approval or other action by,
or any notice or filing with, any Governmental Authority.

 37
 

 

Section
4.3            Enforceability.  The Credit Documents have each been duly
executed and delivered by each Credit Party that is a party thereto and each
Credit Document constitutes the legal, valid, and binding obligation of each
Credit Party that is a party thereto enforceable in accordance with its terms,
except as limited by applicable Debtor Relief Laws or similar laws at the time
in effect affecting the rights of creditors generally and to the effect of
general principles of equity whether applied by a court of law or equity.

Section 4.4            Financial
Condition.

(a)     The Parent has delivered to the Lenders the
Financial Statements for the fiscal quarter ended September 30, 2006 and such
Financial Statements are true and correct in all material respects and present
fairly the consolidated financial condition of the Parent and its Subsidiaries
as of the date thereof.  As of the date
of the financial statements referred in the preceding sentence, there were no
material contingent obligations, liabilities for taxes, unusual forward or long-term
commitments, or unrealized or anticipated losses of the applicable Persons,
except as disclosed therein and adequate reserves for such items have been made
in accordance with GAAP.

(b)     Except as set forth on Schedule 3.1(f),
since December 31, 2005, no event or condition has occurred that could
reasonably be expected to result in Material Adverse Change.

Section
4.5            Ownership and Liens.  The Parent and each Subsidiary have good
title to, or valid leasehold interests in, all its real and personal property
material to its business, except for minor defects in title that do not
interfere with its ability to conduct its business as currently conducted or to
utilize such properties for their intended purposes.

Section
4.6            True and Complete
Disclosure.  All written
factual information (whether delivered before or after the date of this
Agreement) prepared by or on behalf of the Parent or a Subsidiary and furnished
to any Lender Party for purposes of or in connection with this Agreement, any
other Credit Document or any transaction contemplated hereby or thereby is true
and accurate in all material respects on the date as of which such information
is dated or certified and not incomplete by omitting to state any material fact
necessary to make such information (taken as a whole) not materially misleading
at such time, in
light of the circumstances under which they were made.  There is no fact known to any Responsible
Officer of the Parent on the date of this Agreement that has not been disclosed
to the Administrative Agent that could reasonably be expected to result in a
Material Adverse Change.

Section
4.7            Litigation.  There are no actions, suits, or proceedings
pending or, to the Borrower’s or the Parent’s knowledge, threatened against the
Parent, the Borrower or any Subsidiary, at law, in equity, or in admiralty, or
by or before any Governmental Authority, which could reasonably be expected to
result in a Material Adverse Change; provided that this Section 4.7 does not
apply with respect to Environmental Claims. 
Additionally, except as disclosed in writing to the Lender Parties,
there is no pending or, to the best of the knowledge of the Borrower or the
Parent, threatened action or proceeding instituted against the Parent, the
Borrower or any Subsidiary which seeks to adjudicate the Parent, the Borrower
or any Subsidiary as bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or composition of
it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of an order for
relief or the appointment of a receiver, trustee or other similar official for
it or for any substantial part of its Property.

Section
4.8            Compliance with Agreements. 
Neither the Parent nor any Subsidiary is a party to any indenture, loan
or credit agreement or any lease or any other types of agreement or instrument
or subject to any charter or corporate restriction or provision of applicable
law or governmental regulation the 

 38
 

 

performance of or compliance with which could
reasonably be expected to cause a Material Adverse Change.  Neither the Parent nor any Subsidiary is in
default under or with respect to any contract, agreement, lease or any other
types of agreement or instrument to which the Parent or such Subsidiary is a
party and which could reasonably be expected to cause a Material Adverse
Change.  No Default has occurred and
is continuing.

Section
4.9            Pension Plans.  Except for matters that individually or in
the aggregate could not reasonably be expected to result in a liability of
greater than $25,000,000.00, (a) all Plans are in compliance in all material
respects with all applicable provisions of ERISA, (b) no Termination Event has
occurred with respect to any Plan, and each Plan has complied with and been
administered in all material respects in accordance with applicable provisions
of ERISA and the Code, (c) no “accumulated funding deficiency” (as defined in
Section 302 of ERISA) has occurred with respect to any Plan and there has been
no excise tax imposed upon the Parent, the Borrower or any Subsidiary under
Section 4971 of the Code, (d) no Reportable Event has occurred with respect to
any Multiemployer Plan, and each Multiemployer Plan has complied with and been
administered in accordance with applicable provisions of ERISA and the Code,
(e) except as set forth on Schedule 4.9, the present value of all benefits
vested under each Plan (based on the assumptions used to fund such Plan) did
not, as of the last annual valuation date applicable thereto, exceed the value
of the assets of such Plan allocable to such vested benefits, (f) neither the
Parent nor any member of the Controlled Group has had a complete or partial
withdrawal from any Multiemployer Plan for which there is any unsatisfied
withdrawal liability, and (g) neither the Parent nor any member of the
Controlled Group during the last six years has been a participating employer in
a Multiemployer Plan during the last six years. 
Based upon GAAP existing as of the date of this Agreement and current
factual circumstances, neither the Parent nor the Borrower has any reason to
believe that the annual cost during the term of this Agreement to the Parent,
the Borrower or any Subsidiary for post-retirement benefits to be provided,
except as required by law, to the current and former employees of the Parent,
the Borrower or any Subsidiary under Plans that are welfare benefit plans (as
defined in Section 3(1) of ERISA) could reasonably be expected to result in a
liability of greater than $25,000,000.00.

Section 4.10         Environmental Condition.  Except to the extent that any inaccurancy
could not reasonably be expected to result in a Material Adverse Change:

(a)     Permits, Etc.  The Parent, the Borrower and the Subsidiaries
(i) have obtained all material Environmental Permits necessary for the
ownership and operation of their respective Properties and the conduct of their
respective businesses; (ii) except as set forth in Schedule 4.10, have at
all times been and are in material compliance with all terms and conditions of
such Permits and with all other material requirements of applicable
Environmental Laws; (iii) have not received written notice of any material
violation or alleged material violation of any Environmental Law or
Environmental Permit; and (iv) are not subject to any actual or contingent
Environmental Claim.

(b)     Certain Liabilities.  None of the present or previously owned or
operated Property of the Parent, the Borrower or any Subsidiary, wherever located,
(i) has been placed on or proposed to be placed on the National Priorities
List, the Comprehensive Environmental Response Compensation Liability
Information System list, or their state or local analogs, or have been
otherwise investigated, designated, listed, or identified as a potential site
for removal, remediation, cleanup, closure, restoration, reclamation, or other
response activity under any Environmental Laws; (ii) is subject to a Lien,
arising under or in connection with any Environmental Laws, that attaches to
any revenues or to any Property owned or operated by any Credit Party or any
Subsidiary, wherever located; or (iii) has been the site of any Release of
Hazardous Substances or Hazardous Wastes from present or past operations which
has caused at the site or at any third-party site any condition that has
resulted in or could reasonably be expected to result in the need for Response.

 39
 

 

(c)     Certain Actions.  Without limiting the foregoing, (i) all
notices have been properly filed, and no further action is required under
current applicable Environmental Law as to each Response or other restoration
or remedial project undertaken by the Parent, the Borrower, any Subsidiary, or
any Person’s former Subsidiaries on any of their presently or formerly owned or
operated Property and (ii) the present and, to the Parent’s and the Borrower’s
best knowledge, future liability, if any, of the Parent, the Borrower or of any
Subsidiary which could reasonably be expected to arise in connection with
requirements under Environmental Laws.

Section
4.11         Subsidiaries.  As of the Closing Date, the Parent does not
have any Subsidiaries other than those listed on Schedule 4.11.  The Equity Interests of each Subsidiary are
validly issued, fully paid and non-assessable. 
Each Subsidiary, to the extent required, has complied with the
requirements of Section 5.6.

Section
4.12         Investment Company Act.  Neither the Parent nor any Subsidiary is an “investment
company” or a company “controlled” by an “investment company” within the meaning
of the Investment Company Act of 1940, as amended.  Neither the Parent nor any Subsidiary is
subject to regulation under any Federal or state statute, regulation or other
Legal Requirement which limits its ability to incur Debt.

Section
4.13         Taxes.  Proper and accurate (in all material
respects), federal, state, local and foreign tax returns, reports and
statements required to be filed (after giving effect to any extension granted
in the time for filing) by the Parent, the Borrower, any Subsidiary, or any
member of the Affiliated Group as determined under Section 1504 of the Code
(hereafter collectively called the “Tax Group”) have been filed with the
appropriate Governmental Authorities, and all Taxes (which are material in
amount) due and payable have been timely paid prior to the date on which any
fine, penalty, interest, late charge or loss may be added thereto for
non-payment thereof except where contested in good faith and by appropriate
proceeding and for which full or adequate provisions therefor is included on
the books of the appropriate member of the Tax Group.  Proper and accurate amounts have been
withheld (including withholdings from employee wages and salaries relating to
income tax and employment insurance) by the Parent, the Borrower and all other
members of the Tax Group from their employees for all periods to comply in all
material respects with the tax, social security and unemployment withholding
provisions of applicable federal, state, local and foreign law.  Timely payment of all material sales and use
taxes required by applicable law have been made by the Parent, the Borrower and
all other members of the Tax Group.

Section
4.14         Permits, Licenses, etc.  The Parent, the Borrower and each Subsidiary
possesses all permits, licenses, patents, patent rights or licenses,
trademarks, trademark rights, trade names rights, and copyrights which are
material to the conduct of its respective business except where the failure to
maintain the same could not reasonably be expected to result in a Material
Adverse Change.  The Parent, the Borrower
and each Subsidiary manages and operates its business in accordance with all
applicable Legal Requirements except where the failure to so manage or operate
could not reasonably be expected to result in a Material Adverse Change.

Section
4.15         Use of Proceeds.  No Credit Party is engaged in the business of
extending credit for the purpose of purchasing or carrying margin stock (within
the meaning of Regulation U).  No
proceeds of any Advance will be used to purchase or carry any margin stock in
violation of Regulation  T, U or X.

Section
4.16         Condition of Property;
Casualties.  The
material Properties used or to be used in the continuing operations of the
Parent, the Borrower or any Subsidiary, are in good working order and
condition, normal wear and tear excepted, except for certain deficiencies that
could not reasonably be expected to result in a Material Adverse Change.  Neither the business nor the material
Properties of the Parent, the Borrower or any Subsidiary has been affected as a
result of any fire, explosion, earthquake, flood, drought, windstorm, accident,
strike or other labor disturbance, embargo, requisition or taking of 

 40
 

 

Property or cancellation of
contracts, permits or concessions by a Governmental Authority, riot, activities
of armed forces or acts of God or of any public enemy, which effect could
reasonably be expected to cause a Material Adverse Change.

Section
4.17         Insurance.  The Parent, the Borrower and each Subsidiary
carry insurance (which may be carried by the Parent on a consolidated basis) or
maintain appropriate risk management programs in such amounts, covering such
risks and liabilities and with such deductibles or self-insurance retentions as
are reasonable or customary given the nature of its business, its ability to
self-insure, the circumstances and geographic area in which such business is
being conducted and the availability of insurance coverage at commercially
reasonable rates.

ARTICLE V

AFFIRMATIVE COVENANTS

So long as any Obligation
shall remain unpaid, any Lender shall have any Commitment hereunder, or there
shall exist any Letter of Credit Exposure, the Parent and the Borrower each
agrees to comply with the following covenants.

Section
5.1            Organization.  The Parent shall, and shall cause each
Subsidiary to, preserve and maintain its partnership, limited liability company
or corporate existence, rights, franchises and privileges in the jurisdiction
of its organization, and qualify and remain qualified as a foreign business entity
in each jurisdiction in which qualification is necessary or desirable in view
of its business and operations or the ownership of its Properties and where
failure to qualify could reasonably be expected to cause a Material Adverse
Change; provided, however, that nothing herein contained shall prevent
any transaction permitted by Section 6.7 or Section 6.8.

Section 5.2            Reporting.

(a)     Annual Financial Reports.  The Parent shall provide, or shall cause to
be provided, to the Administrative Agent with sufficient copies for the
Lenders, as soon as available after the end of each fiscal year of the Parent,
but in any event no more than thirty days after the date required under
Securities Laws for the filing of its Form 10-K, the unqualified audited annual
Financial Statements, all prepared in conformity with GAAP consistently applied
and all as audited by the Parent’s certified public accountants of nationally recognized standing or
otherwise reasonably acceptable to the Administrative Agent, together with a duly
completed Compliance Certificate.

(b)     Quarterly Financial Reports.  The Parent shall provide to the
Administrative Agent with sufficient copies for the Lenders, as soon as
available after the end of the first three fiscal quarters of each fiscal year
of the Parent, but in any event no more than thirty days after the date
required under Securities Laws for the filing of its Form 10-Q:  (i) an internally prepared Financial
Statement as of the close of such fiscal quarter,  (ii) a comparison of such balance sheet and
the related consolidated statements of income, retained earnings, and cash flow
to the balance sheet and related consolidated statements of income, retained
earnings, and cash flow for the corresponding fiscal period of the preceding
fiscal year, (iii) any other such items as the Administrative Agent may
reasonably request, all of which shall be certified as accurate by a senior
financial officer of the Parent, and (iv) a duly completed Compliance
Certificate.

(c)     Defaults.  The Parent shall provide to the
Administrative Agent promptly, but in any event within three Business Days
after knowledge of the occurrence thereof, a notice of each Default or Event of
Default known to the Parent, the Borrower or to any other Subsidiary, together
with a statement of an Responsible Officer of the Parent setting forth the
details of such Default or Event of Default and the 

 41
 

 

actions which the Parent,
the Borrower or such other Subsidiary has taken and proposes to take with
respect thereto.

(d)     Other Creditors.  The Parent shall provide to the
Administrative Agent promptly after the giving or receipt thereof, copies of
any default notices given or received by the Parent, the Borrower or by any
other Subsidiary pursuant to the terms of any indenture, loan agreement, credit
agreement, or similar agreement evidencing or relating to Debt in a principal
amount equal to or greater than $10,000,000.

(e)     Litigation.  The Parent shall provide to the
Administrative Agent promptly after the commencement thereof, notice of all
actions, suits, and proceedings before any Governmental Authority, affecting
the Parent, the Borrower or any other Subsidiary that could reasonably be
expected to result in a Material Adverse Change.

(f)      Environmental Notices.  Promptly upon, and in any event no later than
15 days after, the receipt thereof, or the acquisition of knowledge thereof, by
the Parent, the Borrower or any other Subsidiary, the Parent shall provide the
Administrative Agent with a copy of any form of request, claim, complaint, order,
notice, summons or citation received from any Governmental Authority or any
other Person, (i) concerning violations or alleged violations of
Environmental Laws, which seeks to impose liability therefore in excess of
$10,000,000, (ii) concerning any action or omission on the part of the
Parent or any of its Subsidiaries in connection with Hazardous Waste or
Hazardous Substances which could reasonably result in the imposition of
liability in excess of $10,000,000 or requiring that action be taken to respond
to or clean up a Release of Hazardous Substances or Hazardous Waste into the
environment and such action or clean-up could reasonably be expected to exceed
$10,000,000, including without limitation any information request related to,
or notice of, potential responsibility under CERCLA, or (iii) concerning
the filing of a Lien (other than Permitted Lien) upon, against or in connection
with the Parent, the Borrower or any other Subsidiary, or any of their leased
or owned Property, wherever located.

(g)     Material Changes.  The Parent shall provide to the
Administrative Agent prompt written notice of any condition or event of which
the Parent, the Borrower or any other Subsidiary has knowledge, which condition
or event has resulted or may reasonably be expected to result in (i) a Material
Adverse Change or (ii) a breach of or noncompliance with any material term,
condition, or covenant of any material contract to which the Parent, the
Borrower or any other Subsidiary is a party or by which their Properties may be
bound which breach or noncompliance could reasonably be expected to result in a
Material Adverse Change.

(h)     Termination Events.  As soon as possible and in any event (i)
within 30 days after the Parent or any member of the Controlled Group knows or
has reason to know that any Termination Event described in clause (a) of the
definition of Termination Event with respect to any Plan has occurred, and
(ii) within 10 days after the Parent or any member of the Controlled Group
knows or has reason to know that any other Termination Event with respect to
any Plan has occurred, the Parent shall provide to the Administrative Agent a
statement of a Responsible Officer of the Parent describing such Termination
Event and the action, if any, which the Parent or any Affiliate of the Parent
proposes to take with respect thereto;

(i)      Termination of Plans.  Promptly and in any event within five
Business Days after receipt thereof by the Parent, the Borrower or any other
member of the Controlled Group from the PBGC, the Parent shall provide to the
Administrative Agent copies of each notice received by the Parent, the Borrower
or any such other member of the Controlled Group of the PBGC’s intention to
terminate any Plan or to have a trustee appointed to administer any Plan;

 42

 

(j)      Other ERISA Notices.  (i) Promptly and in any event within five
Business Days after receipt thereof by the Parent, the Borrower or any other
member of the Controlled Group from a Multiemployer Plan sponsor, the Parent
shall provide to the Administrative Agent a copy of each notice received by the
Parent, the Borrower or any other member of the Controlled Group concerning the
imposition or amount of withdrawal liability imposed on the Parent, the
Borrower or any other member of the Controlled Group pursuant to Section 4202
of ERISA; (ii) as soon as possible and in any event no later than 30 days prior
to the occurrence of such event, the Parent shall provide to the Administrative
Agent written notice of an assumption by the Parent, any Subsidiary, or any member
of the Controlled Group of an obligation to contribute to any Multiemployer
Plan; and (iii) as soon as possible and in any event no later than 30 days
prior to the occurrence of such event, the Parent shall provide to the
Administrative Agent written notice of an acquisition by the Parent, any
Subsidiary, or any member of the Controlled Group of an interest in any Person
that causes such Person to become a member of the Controlled Group if such
Person sponsors, maintains or contributes to, or at any time in the six-year
period preceding such acquisition has sponsored, maintained, or contributed to,
(1) any Multiemployer Plan, or (2) any other Plan that is subject to Title IV
of ERISA under which the actuarial present value of the benefit liabilities under
such Plan exceeds the current value of the assets (computed on a plan
termination basis in accordance with Title IV of ERISA) of such Plan allocable
to such benefit liabilities;

(k)     Other Governmental Notices.  Promptly and in any event within five Business
Days after receipt thereof by the Parent, the Borrower or any other Subsidiary,
the Parent shall provide to the Administrative Agent a copy of any notice,
summons, citation, or proceeding seeking to modify in any material respect,
revoke, or suspend any material contract, license, permit, or agreement with
any Governmental Authority if such modification, revocation or suspension could
reasonably be expected to result in a Material Adverse Change;

(l)      Disputes; etc.  Promptly and in any event within five
Business Days after knowledge thereof by the Parent, the Borrower or any other
Subsidiary, the Parent shall provide to the Administrative Agent written notice
of (i) any claims, legal or arbitration proceedings, proceedings before any
Governmental Authority, or disputes, or to the knowledge of the Parent, the
Borrower or any other Subsidiary, any such actions threatened, or affecting the
Parent, the Borrower or any other Subsidiary, which, if adversely determined,
could reasonably be expected to cause a Material Adverse Change, or any
material labor controversy of which the Parent, the Borrower or any other
Subsidiary has knowledge resulting in or reasonably considered to be likely to
result in a strike against the Parent, the Borrower or any other Subsidiary if
such strike could reasonably be expected to result in a Material Adverse
Change, and (ii) any claim, judgment, Lien or other encumbrance (other than a
Permitted Lien) affecting any Property of the Parent, the Borrower or any other
Subsidiary, if the value of the claim, judgment, Lien, or other encumbrance
affecting such Property shall exceed $10,000,000;

(m)    SEC.  Promptly after the same become publicly
available, the Parent shall provide to the Administrative Agent copies of all
periodic and other reports, proxy statements and other materials (other than
filings under Section 16 of the Securities Exchange Act of 1934) filed by the
Parent, the Borrower or any other Subsidiary with the SEC, or any Governmental
Authority succeeding to any or all of the functions of said Commission, or with
any national securities exchange, or distributed by the Parent, the Borrower or
any other Subsidiary to its shareholders generally, as the case may be; and

(n)     Other Information.  Subject to
the confidentiality provisions of Section 9.8, the Parent shall provide to the
Administrative Agent such other information respecting the business,
operations, or Property of the Parent, the Borrower or any other Subsidiary,
financial or otherwise, as any Lender through the Administrative Agent may
reasonably request.

 43
 

 

Documents required to be delivered pursuant to Section 5.2(a), (b),
or (m) (to the extent any such documents are included in materials
otherwise filed with the SEC) may be delivered electronically and if so
delivered, shall be deemed to have been delivered on the date (i) on which the
Parent posts such documents, or provides a link thereto on the Parent’s website
on the Internet at the website address listed on Schedule III; or (ii)
on which such documents are posted on the Parent’s behalf on
IntraLinks/IntraAgency or another relevant website (including, without
limitation, the SEC’s website), if any, to which each Lender and the
Administrative Agent have access (whether a commercial, third-party website or
whether sponsored by the Administrative Agent); provided that: the
Parent shall notify (which may be by facsimile or electronic mail) the
Administrative Agent (and the Administrative Agent shall promptly notify the
Lenders thereof) of the posting of any such documents.  The Administrative Agent shall not have an
obligation to request the delivery or to maintain copies of the documents
referred to above, and in any event shall have no responsibility to monitor
compliance by the Parent with any such request for delivery, and each Lender
shall be solely responsible for requesting delivery to it or maintaining its
copies of such documents.

Section
5.3            Insurance.  The Parent shall, and shall cause each
Subsidiary to, carry insurance (which may be carried by the Parent on a consolidated
basis) or maintain appropriate risk management programs in such amounts,
covering such risks and liabilities and with such deductibles or self-insurance
retentions as are reasonable or customary given the nature of its business, its
ability to self-insure, the circumstances and geographic area in which such
business is being conducted and the availability of insurance coverage at
commercially reasonable rates.

Section
5.4            Compliance
with Laws.  The Parent
shall, and shall cause each Subsidiary to, comply with all federal, state,
provincial, territorial and local laws and regulations (including Environmental
Laws) which are applicable to the operations and Property of the Parent or such
Subsidiary and maintain all related permits necessary for the ownership and
operation of the Parent’s and such Subsidiary’s Property and business, except
in any case where the failure to so comply could not reasonably be expected to
result in a Material Adverse Change, provided that this Section 5.4
shall not prevent the Parent or any of its Subsidiaries from, in good faith and
with reasonable diligence, contesting the validity or application of any such
laws or regulations by appropriate legal proceedings for which adequate
reserves have been established.

Section
5.5            Taxes.  The Parent shall, and shall cause each
Subsidiary to pay and discharge all Taxes imposed on the Parent or any of its
Subsidiaries, respectively, prior to the date on which penalties attach; provided
that nothing in this Section 5.5 shall require the Parent or any of its
Subsidiaries to pay any Tax which is being contested in good faith and for
which adequate reserves have been established in accordance with GAAP.

Section
5.6            Additional
Guarantors.  On or
before 45 days after the end of each fiscal quarter during which any Person
becomes a Material Subsidiary, the Parent shall (a) cause such Subsidiary to
execute and deliver to the Administrative Agent, a joinder to the Guaranty, and
(b) cause such Subsidiary to deliver such evidence of corporate authority to
enter into such Credit Documents and favorable opinions of counsel to such Person
(which shall cover, among other things, the legality, validity, binding effect
and enforceability of the documentation referred to in clause (a)) as the
Administrative Agent may reasonably request.

Section
5.7            Records;
Inspection.  The Parent
shall, and shall cause each Subsidiary to maintain proper, complete and
consistent books of record with respect to such Person’s operations, affairs,
and financial condition.  From time to
time upon reasonable prior notice, the Parent shall permit any Lender and shall
cause each Subsidiary to permit any Lender, at such reasonable times and
intervals and to a reasonable extent and under the reasonable guidance of
officers of or employees delegated by officers of

 44
 

 

the Parent or such
Subsidiary, to, subject to any applicable confidentiality considerations,
examine the books and records of the Parent or such Subsidiary, to visit and
inspect the Property of the Parent or such Subsidiary, and to discuss the
business operations and Property of the Parent or such Subsidiary with the
officers and directors thereof.

Section
5.8            Maintenance
of Property.  The Parent
shall, and shall cause each Subsidiary to, maintain their owned, leased, or operated
Property in good condition and repair, normal wear and tear excepted, except to
the extent any failure to so maintain could not reasonable be expected to
result in a Material Adverse Change; and shall abstain from, and cause each
Subsidiary to abstain from, knowingly or willfully permitting the commission of
waste or other injury, destruction, or loss of natural resources, or the
occurrence of pollution, contamination, or any other condition in, on or about
the owned or operated Property involving the Environment that could reasonably
be expected to result in Response activities and that could reasonably be
expected to cause a Material Adverse Change.

ARTICLE VI

NEGATIVE COVENANTS

So
long as any Obligation shall remain unpaid, any Lender shall have any
Commitment hereunder, or there shall exist any Letter of Credit Exposure, the
Borrower and the Parent each agrees to comply with the following covenants.

Section
6.1            Debt. 
The Parent shall not, nor shall it permit any Subsidiary to, create,
assume, incur, suffer to exist, or in any manner become liable, directly,
indirectly, or contingently in respect of, any Debt, unless the Parent shall be
in compliance, on a pro forma basis after giving effect to such transactions,
with the remaining covenants contained in this Article VI recomputed as of the
last day of the most recently ended fiscal quarter of the Borrower as if the
transaction in question had occurred on the first day of each relevant period
for testing such compliance.

Section
6.2            Liens.  The Parent shall not, nor shall it permit any
of its Subsidiaries to, create, assume, incur, or suffer to exist any Lien on
the Property of the Parent, the Borrower or any other Subsidiary of the Parent,
whether now owned or hereafter acquired, or assign any right to receive any
income, other than the following:

(a)     Liens securing the
Obligations;

(b)     Liens imposed by law, such
as materialmen’s, mechanics’, builder’s, carriers’, workmen’s and repairmen’s
liens, and other similar liens arising in the ordinary course of business
securing obligations which are not overdue for a period of more than 30 days or
are being contested in good faith by appropriate procedures or proceedings and
for which adequate reserves have been established;

(c)     Liens arising in the ordinary
course of business out of pledges or deposits under workers compensation laws,
unemployment insurance, old age pensions, or other social security or
retirement benefits, or similar legislation to secure public or statutory
obligations;

(d)     Liens for taxes, assessment,
or other governmental charges which are not yet due and payable or which are
being actively contested in good faith by appropriate proceedings and for which
adequate reserves for such items have been made in accordance with GAAP;

(e)     Liens arising from
precautionary UCC financing statements regarding leases to the extent such
leases are permitted hereby;

 45
 

 

(f)      encumbrances consisting of
minor easements, zoning restrictions, or other restrictions on the use of real
property that do not (individually or in the aggregate) materially affect the
value of the assets encumbered thereby or materially impair the ability of the
Parent, the Borrower or such other Subsidiary to use such assets in its
business, and none of which is violated in any material aspect by existing or
proposed structures or land use to the extent such violation could reasonably
be expected to result in a Material Adverse Change;

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

(h)     Liens on cash or securities
pledged to secure performance of tenders, surety and appeal bonds, government
contracts, performance and return of money bonds, bids, trade contracts,
leases, statutory obligations, regulatory obligations and other obligations of
a like nature incurred in the ordinary course of business;

(i)      judgment and attachment
Liens not giving rise to an Event of Default, provided that (i) any appropriate
legal proceedings which may have been duly initiated for the review of such
judgment shall not have been finally terminated or the period within which such
proceeding may be initiated shall not have expired and (ii) no action to
enforce such Lien has been commenced;

(j)      Liens securing Debt and not
otherwise permitted under this Section 6.2; provided that (i) the aggregate
principal amount of all Debt
secured by such Liens does not exceed 15% of the Net Worth of the
Parent and its consolidated Subsidiaries at any time, and (ii) the Parent, the
Borrower and its Subsidiaries are in compliance with the covenants set forth in
this Agreement, both before and after giving effect to each incurrence of such
Debt.

Section
6.3            Investments.  The Parent shall not, nor shall it permit any
Subsidiary to, make or hold any direct or indirect investment in any Person,
including capital contributions to the Person, investments in or the
acquisition of the debt or equity securities of the Person, or any loans,
guaranties, trade credit, or other extensions of credit to any Person, other
than the following (collectively, the “Permitted Investments”):

(a)     Investments consisting of the Investment Portfolio;

(b)     Investments consisting of
Acquisitions permitted by Section 6.4;

(c)     investments by the Parent or any Subsidiary in the
Parent or any of its wholly-owned Domestic Subsidiaries;

(d)     other investments, loans and
advances in an aggregate amount (valued at cost or outstanding principal
amount, as the case may be) not greater than 20% of Net Worth at any time
outstanding.

Section
6.4            Acquisitions.  The Parent shall not, nor shall it permit any
Subsidiary to, make an Acquisition in a transaction or related series of
transactions; provided that, an Acquisition may be made so long as no Default
exists both before and after giving effect to such Acquisition.

Section
6.5            Agreements
Restricting Liens; Negative Pledge.  The Parent shall not, nor shall it permit any
Subsidiary to, create, incur, assume or permit to exist any contract, agreement
or understanding (other than this Agreement. 
Agreements governing secured Debt permitted by Section 6.2 to the extent
such restrictions govern only the asset financed pursuant to such Debt and the
Note Purchase

 46
 

 

Agreement dated as of August
15, 2002 among the Parent, the Borrower and each of the purchasers party
thereto) which in any way prohibits or restricts the granting, conveying,
creation or imposition of any Lien on any of its Property, whether now owned or
hereafter acquired, to secure the Obligations or restricts any Subsidiary from
paying Restricted Payments to the Borrower, or which requires the consent of or
notice to other Persons in connection therewith.

Section
6.6            Use
of Proceeds; Use of Letters of Credit.  The Borrower shall not, nor shall it permit
any Subsidiary to use the proceeds of Advances and Letters of Credit for any
purposes other than (a) to refinance the Debt outstanding under the Existing
Credit Agreement, (b) for working capital and other general corporate purposes,
(c) fund capital expenditures and (d) the payment of fees and expenses related
to the entering into of this Agreement and the other Credit Documents;.  The Parent shall not, nor shall it permit any
of its Subsidiaries to, directly or indirectly use any part of the proceeds of
Advances or Letters of Credit for any purpose which violates, or is
inconsistent with, Regulations T, U, or X.

Section
6.7            Corporate
Actions; Fundamental Changes.

(a)     The Parent shall not, nor
shall it permit any Credit Party to, merge, amalgamate or consolidate with or
into any other Person, except that (i) the Parent may merge or amalgamate with
any Person provided that (A) no Change in Control occurs and (B)
immediately after giving effect to any such proposed transaction no Default
would exist, (ii) the Borrower may merge or amalgamate with any of its
wholly-owned Subsidiaries, provided that immediately after giving effect
to any such proposed transaction no Default would exist and the Borrower is the
surviving entity, (iii) the Borrower may merge or amalgamate with the Parent provided
that immediately after giving effect to any such proposed transaction (A) no
Default would exist, (B) the Parent executes an assumption agreement reasonably
acceptable to the Administrative Agent pursuant to which the Parent shall
assume the Obligations of the Borrower under this Agreement and the other
Credit Documents and (C) the Parent shall deliver such evidence of corporate
authority to enter into such assumption and favorable opinions of counsel as
the Administrative Agent may reasonably request; and (iv) any Subsidiary of the
Borrower may merge, amalgamate or be consolidated with or into any other
Person, provided that immediately after giving effect to any such
proposed transaction no Default would exist.

(b)     The Parent shall not, nor shall it permit any Credit Party to,
sell, transfer, lease or otherwise dispose of (in one transaction or in a
series of transactions) all or substantially all/any substantial part of its
assets, or all or substantially all of the stock of any of its Subsidiaries (in
each case, whether now owned or hereafter acquired), or liquidate or dissolve,
except that, if at the time thereof and immediately after giving effect thereto
no Default shall have occurred and be continuing (i) any Subsidiary of the
Borrower may sell, transfer, lease or otherwise dispose of (in one transaction
or in a series of transactions) all or substantially all/any substantial part
of its assets, or all or substantially all of the stock of any of its
Subsidiaries (in each case, whether now owned or hereafter acquired), to any
Person, (ii) any Subsidiary of the Borrower may liquidate or dissolve if the
Borrower determines in good faith that such liquidation or dissolution is in
the best interests of the Borrower and is not materially disadvantageous to the
Lenders and (iii) the Parent may sell, transfer, lease or otherwise dispose of
(in one transaction or in a series of transactions) all or substantially all/any
substantial part of its assets, or all or substantially all of the stock of any
of its Subsidiaries (other than the Borrower) (in each case, whether now owned
or hereafter acquired), to any Person; provided, however that
notwithstanding the foregoing, the Parent and its Subsidiaries, taken as whole,
shall not sell, transfer, lease or otherwise dispose of (in one transaction or
in a series of transactions) all or substantially all/any substantial part of
its assets (in each case, whether now owned or hereafter acquired).

Section
6.8            Sale
of Assets.  The Parent
shall not, nor shall it permit any Subsidiary to, sell, convey, or otherwise
transfer any of its assets outside the ordinary course of business; provided
that, any such

 47
 

 

sale, conveyance or transfer
may be effected if (a) such sale, conveyance or transfer is for fair market
value and in an arm’s length transaction, (b) no Default exists both prior to
and after giving effect to such sale, conveyance or transfer and (c) such sale,
conveyance or transfer is not prohibited under Section 6.7 above.

Section
6.9            Restricted
Payments.  The Parent
shall not, nor shall it permit any Subsidiary to make any Restricted Payments
if at the time of the making of such Restricted Payments a Default exists or an
Default would result from the making of such Restricted Payment.

Section
6.10         Affiliate
Transactions.  The Parent
shall not, nor shall it permit any Subsidiary to, directly or indirectly, enter
into or permit to exist any transaction or series of transactions (including,
but not limited to, the purchase, sale, lease or exchange of Property, the
making of any investment, the giving of any guaranty, the assumption of any
obligation or the rendering of any service) with any of their Affiliates unless
such transaction or series of transactions is on terms no less favorable to the
Parent or any Subsidiary, as applicable, than those that could be obtained in a
comparable arm’s length transaction with a Person that is not such an
affiliate, provided that the foregoing restriction shall not apply to
transactions between or among the Parent and any of its wholly-owned
Subsidiaries or between and among any wholly-owned Subsidiaries.

Section
6.11         Line
of Business.  The Parent
shall not, nor shall it permit any Subsidiary to, change the character of its
business such that the principal business of the Parent and its Subsidiaries is
not contract drilling substantially as conducted on the date of this Agreement.

Section
6.12         Compliance
with ERISA.  Except for
matters that individually or in the aggregate could not reasonably be expected
to result in a liability of greater than $25,000,000.00, the Parent shall not,
nor shall it permit any Subsidiary to, directly or indirectly: (a) engage in
any transaction in connection with which the Parent or any Subsidiary could be
subjected to either a civil penalty assessed pursuant to section 502(c), (i) or
(l) of ERISA or a tax imposed by Chapter 43 of Subtitle D of the Code; (b) fail
to make, or permit any member of the Controlled Group to fail to make, full
payment when due of all amounts which, under the provisions of any Plan,
agreement relating thereto or applicable law, the Parent, a Subsidiary or
member of the Controlled Group is required to pay as contributions thereto; (c)
permit to exist, or allow any Subsidiary or any member of the Controlled Group
to permit to exist, any accumulated funding deficiency within the meaning of
Section 302 of ERISA or section 412 of the Code, whether or not waived, with
respect to any Plan; (d) permit, or allow any member of the Controlled Group to
permit, the actuarial present value of the benefit liabilities (as “actuarial
present value of the benefit liabilities” shall have the meaning specified in
section 4041 of ERISA) under any Plan that is regulated under Title IV of ERISA
to exceed the current value of the assets (computed on a plan termination basis
in accordance with Title IV of ERISA) of such Plan allocable to such benefit
liabilities except as shown on Schedule 6.12; (e) incur, or permit any member
of the Controlled Group to incur, a liability to or on account of a Plan under
sections 515, 4062, 4063, 4064, 4201 or 4204 of ERISA; or (f) amend or
permit any member of the Controlled Group to amend, a Plan resulting in an
increase in current liability such that the Parent, any Subsidiary or any
member of the Controlled Group is required to provide security to such Plan
under section 401(a)(29) of the Code.

Section
6.13         Hedging
Arrangements.  The Parent
shall not, nor shall it permit any Subsidiary to, (a) purchase, assume, or hold
a speculative position in any commodities market or futures market or enter
into any Hedging Arrangement for speculative purposes; or (b) be party to or
otherwise enter into any Hedging Arrangement which (i) is entered into for
reasons other than as a part of its normal business operations as a risk
management strategy and/or hedge against changes resulting from market
conditions related to the Parent’s or its Subsidiaries’ operations, or (ii)
obligates the Parent or any Subsidiary to any margin call requirements.

 48
 

 

Section
6.14         Funded
Leverage Ratio.  The Parent
shall not permit the Funded Leverage Ratio, at the end of each fiscal quarter
of the Parent, to be greater than 50%.

Section
6.15         Interest
Coverage Ratio.  The Parent
shall not permit the ratio of, as of the last day of each fiscal quarter, (a)
the consolidated EBITDA of the Parent, for the four-fiscal period then ended,
to (b) the consolidated Interest Expense of the Parent for the four-fiscal
period then ended, to be less than 3.00 to 1.00.

ARTICLE VII

DEFAULT AND REMEDIES

Section
7.1            Events
of Default.  The
occurrence of any of the following events shall constitute an “Event of Default”
under this Agreement and any other Credit Document:

(a)     Payment Failure.  Any Credit Party (i) fails to pay any
principal when due under this Agreement or (ii) fails to pay, within three
Business Days of when due, any other amount due under this Agreement or any
other Credit Document, including payments of interest, fees, reimbursements,
and indemnifications;

(b)     False Representation or
Warranties.  Any
representation or warranty made or deemed to be made by any Credit Party or any
Responsible Officer thereof in this Agreement, in any other Credit Document or
in any certificate delivered in connection with this Agreement or any other
Credit Document is incorrect, false or otherwise misleading in any material
respect at the time it was made or deemed made;

(c)     Breach of Covenant.  (i) Any breach by any Credit Party of any of
the covenants in Section 5.2(c), Section 5.2(d), or Article VI of this
Agreement or the corresponding covenants in any Guaranty or (ii) any breach by
any Credit Party of any other covenant contained in this Agreement or any other
Credit Document and such breach is not cured within 30 days after the earlier
of the date notice thereof is given to the Borrower by any Lender Party or the
date any Responsible Officer of the Parent, the Borrower or any other
Subsidiary obtained actual knowledge thereof;

(d)     Guaranty.  Any provision in the Guaranty shall at any
time (before its expiration according to its terms) and for any reason cease to
be in full force and effect and valid and binding on the Guarantors party
thereto or shall be contested by any party thereto; any Guarantor shall deny it
has any liability or obligation under such Guaranty; or any Guarantor shall
cease to exist other than as expressly permitted by the terms of this
Agreement;

(e)     Cross-Default. (i) The
Parent, the Borrower or any Subsidiary shall fail to pay any principal of or
premium or interest on its Debt which is outstanding in a principal amount of
at least $25,000,000.00 individually or when aggregated with all such Debt of
such Persons so in default (but excluding Debt constituting Obligations) when the
same becomes due and payable (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise), and such failure shall continue
after the applicable grace period, if any, specified in the agreement or
instrument relating to such Debt; (ii) any other event shall occur or
condition shall exist under any agreement or instrument relating to Debt which
is outstanding in a principal amount of at least $25,000,000.00 individually or
when aggregated with all such Debt of such Persons so in default (other than
Debt constituting Obligations), and shall continue after the applicable grace
period, if any, specified in such agreement or instrument, if the effect of
such event or condition is to accelerate, or to permit the acceleration of, the
maturity of such Debt prior to the stated maturity thereof; or (iii) any
such Debt which is outstanding in a principal amount of at least $25,000,000.00
individually or when aggregated with all such Debt of such Persons so in
default shall be declared to be due and payable, or required to be prepaid
(other than by a regularly scheduled required

 49
 

 

prepayment); provided
that, for purposes of this subsection 7.1(f), the “principal amount” of the
obligations in respect of any Hedging Arrangements at any time shall be the
maximum aggregate amount (giving effect to any netting agreements) that would
be required to be paid if such Hedging Arrangements were terminated at such
time;

(f)      Bankruptcy and Insolvency.  (i) The Parent or the Borrower shall
terminate its existence or dissolve or (ii) any Credit Party or any Subsidiary
(A) admits in writing its inability to pay its debts generally as they become
due; makes an assignment for the benefit of its creditors; consents to or
acquiesces in the appointment of a receiver, liquidator, fiscal agent, or
trustee of itself or any of its Property; files a petition under any Debtor
Relief Law; or consents to any reorganization, arrangement, workout,
liquidation, dissolution, or similar relief under any Debtor Relief Law, (B) shall
have had, without its consent, any court enter an order appointing a receiver,
liquidator, fiscal agent, or trustee of itself or any of its Property; any
petition filed against it seeking reorganization, arrangement, workout,
liquidation, dissolution or similar relief under any Debtor Relief Law and such
petition shall not be dismissed, stayed, or set aside for an aggregate of 60
days, whether or not consecutive or (C) shall have had any order for relief
entered by a court under any Debtor Relief Law;

(g)     Adverse Judgment.  The Parent or any Subsidiary suffers final
judgments against any of them since the date of this Agreement in an aggregate
amount, less any insurance proceeds covering such judgments which are received
or as to which the insurance carriers admit liability, greater than
$25,000,000.00 and either (i) enforcement proceedings shall have been commenced
by any creditor upon such judgments or (ii) there shall be any period of 30
consecutive days during which a stay of enforcement of such judgments, by
reason of a pending appeal or otherwise, shall not be in effect;

(h)     Termination Events.  Any Termination Event with respect to a Plan
shall have occurred, and, 30 days after notice thereof shall have been given to
the Parent by the Administrative Agent, such Termination Event shall not have
been corrected and shall have created and caused to be continuing a material
risk of Plan termination or liability for withdrawal from the Plan as a “substantial
employer” (as defined in Section 4001(a)(2) of ERISA), which termination could
reasonably be expect to result in a liability of, or liability for withdrawal
could reasonably be expected to be, greater than $25,000,000.00;

(i)      Plan Withdrawals.  The Parent or any member of the Controlled
Group as employer under a Multiemployer Plan shall have made a complete or
partial withdrawal from such Multiemployer Plan and such withdrawing employer
shall have incurred a withdrawal liability in an annual amount exceeding
$25,000,000.00; or

(j)      Parent.  The Parent ceases to own (free and clear of
all Liens), either directly or indirectly, 100% of the Equity Interests in the
Borrower.

(k)     Change in Control.  The occurrence of a Change in Control without
the approval of the Majority Lenders.

Section
7.2            Optional
Acceleration of Maturity.  If any Event of Default (other than an Event
of Default pursuant to Section 7.1(f)) shall have occurred and be continuing,
then, and in any such event,

(a)     the Administrative Agent
(i) shall at the request, or may with the consent, of the Majority
Lenders, by notice to the Borrower, declare that the obligation of each Lender,
the Swingline Lender and each Issuing Lender to make Credit Extensions shall be
terminated, whereupon the same shall forthwith terminate, and (ii) shall at the
request, or may with the consent, of the Majority Lenders, by notice to the
Borrower, declare all outstanding Advances, all interest thereon, and all other
amounts payable under this Agreement to be forthwith due and payable, whereupon
such Advances, all such interest, and all such

 50
 

 

amounts shall become and be
forthwith due and payable in full, without presentment, demand, protest or
further notice of any kind (including, without limitation, any notice of intent
to accelerate or notice of acceleration), all of which are hereby expressly
waived by the Borrower,

(b)     the Borrower shall, on
demand of the Administrative Agent at the request or with the consent of the
Majority Lenders, deposit with the Administrative Agent into the Cash
Collateral Account an amount of cash equal to 105% of the outstanding Letter of
Credit Exposure as security for the Obligations to the extent the Letter of
Credit Obligations are not otherwise paid or cash collateralized at such time,
and

(c)     the Administrative Agent
shall at the request of, or may with the consent of, the Majority Lenders
proceed to enforce its rights and remedies under the Guaranty or any other
Credit Document by appropriate proceedings.

Section
7.3            Automatic
Acceleration of Maturity.  If any Event of Default pursuant to Section
7.1(f) shall occur,

(a)     obligation of each Lender,
the Swingline Lender and each Issuing Lender to make Credit Extensions shall
immediately and automatically be terminated and all Advances, all interest on
the Advances, and all other amounts payable under this Agreement shall
immediately and automatically become and be due and payable in full, without
presentment, demand, protest or any notice of any kind (including, without
limitation, any notice of intent to accelerate or notice of acceleration), all
of which are hereby expressly waived by the Borrower,

(b)     the Borrower shall deposit
with the Administrative Agent into the Cash Collateral Account an amount of
cash equal to 105% of the outstanding Letter of Credit Exposure as security for
the Obligations to the extent the Letter of Credit Obligations are not
otherwise paid or cash collateralized at such time, and

(c)     the Administrative Agent
shall at the request of, or may with the consent of, the Majority Lenders
proceed to enforce its rights and remedies under the Guaranty or any other
Credit Document by appropriate proceedings.

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

 51
 

 

Section
7.5            Remedies
Cumulative, No Waiver.  No
right, power, or remedy conferred to any Lender, Administrative Agent, or
Issuing Lender in this Agreement or the Credit Documents, or now or hereafter
existing at law, in equity, by statute, or otherwise shall be exclusive, and
each such right, power, or remedy shall to the full extent permitted by law be
cumulative and in addition to every other such right, power or remedy.  No course of dealing and no delay in
exercising any right, power, or remedy conferred to any Lender, Administrative
Agent, or Issuing Lender in this Agreement and the Credit Documents or now or
hereafter existing at law, in equity, by statute, or otherwise shall operate as
a waiver of or otherwise prejudice any such right, power, or remedy.  Any Lender, Administrative Agent, or Issuing
Lender may cure any Event of Default without waiving the Event of Default.  No notice to or demand upon the Borrower
shall entitle the Borrower to similar notices or demands in the future.

Section 7.6            Application
of Payments.

(a)     Prior to Event of Default.  Prior to an Event of Default, all payments
made hereunder shall be applied as directed by the Borrower, but such payments
are subject to the terms of this Agreement.

(b)     After Event of Default.  If an Event of Default has occurred and is
continuing, any amounts received or collected from, or on account of assets
held by, any Credit Party shall be applied to the Obligations by the
Administrative Agent in the following order and manner:

(i)            First, to
payment of that portion of such Obligations constituting fees, indemnities,
expenses, and other amounts (including fees, charges, and disbursements of
counsel to the Administrative Agent and amounts payable under Sections 2.11,
2.12, and 2.14) payable by any Credit Party to the Administrative Agent in its
capacity as such;

(ii)           Second, to
payment of that portion of such Obligations constituting fees, indemnities and
other amounts (other than principal and interest) payable by any Credit Party
to the Lender Parties (including fees, charges and disbursements of counsel to
the respective Lender Parties and amounts payable under Article II), ratably
among Lender Parties;

(iii)          Third, to
payment of that portion of such Obligations constituting accrued and unpaid
interest, allocated ratably among the Lender Parties;

(iv)          Fourth, to
payment of that portion of the Obligations constituting unpaid principal of the
Obligations payable by any Credit Party allocated ratably among the Lender
Parties;

(v)           Fifth, to the
Administrative Agent for the account of the applicable Issuing Lender, ratably
between the two Issuing Lenders, to cash collateralize that portion of the
Letter of Credit Obligations comprised of the aggregate undrawn amount of
Letters of Credit;

(vi)          Sixth, to the
remaining Obligations owed by any Credit Party including all Obligations for
which the Parent is liable as a Guarantor, allocated among such remaining
Obligations as determined by the Administrative Agent and the Majority Lenders
and applied to such Obligations in the order specified in this clause (b); and

(vii)         Last, the
balance, if any, after all of the Obligations have been indefeasibly paid in
full, the Letters of Credit have been terminated or cash collateralized and all
Commitments have been terminated, to Borrower or as otherwise required by any
Legal Requirement.

Subject to Section 2.3(i), amounts used to cash collateralize the
aggregate undrawn amount of Letters of Credit pursuant to clause Sixth above
shall be applied to satisfy drawings under such Letters of Credit as

 52
 

 

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 VIII

THE ADMINISTRATIVE AGENT AND
ISSUING LENDERS

Section
8.1            Appointment
and Authority.  Each Lender and each Issuing Lender hereby
irrevocably (a) appoints Wells Fargo to act on its behalf as the Administrative
Agent hereunder and under the other Credit Documents, and (b) authorizes the
Administrative Agent to take such actions on its behalf and to exercise such
powers as are delegated to the Administrative Agent by the terms hereof or
thereof, together with such actions and powers as are reasonably incidental
thereto.  The provisions of this Article
VIII are solely for the benefit of the Lender Parties, and neither the Parent,
the Borrower nor any other Credit Party shall have rights as a third party
beneficiary of any of such provisions.

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

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

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

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

(c)     shall not, except as
expressly set forth herein and in the other Credit Documents, have any duty to
disclose, nor shall it be liable for the failure to disclose, any information
relating to the Parent, the Borrower, any other Credit Party or any of their
respective Affiliates that is communicated to or obtained by the Person serving
as the Administrative Agent or any of its Affiliates in any capacity.

The Administrative Agent shall not be liable
for any action taken or not taken by it (i) with the consent or at the
request of the Majority Lenders (or such other number or percentage of the
Lenders as shall be necessary, or as the Administrative Agent shall believe in
good faith shall be necessary, under the circumstances as provided in
Sections 9.2 and 7.1) or (ii) in the absence of its own gross
negligence or willful misconduct.  The
Administrative Agent shall not be deemed not to have knowledge of any Default

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unless and until notice describing such
Default is given to the Administrative Agent by the Borrower, a Lender or an Issuing
Lender.

The Administrative Agent shall not be
responsible for or have any duty to ascertain or inquire into (i) any
statement, warranty or representation made in or in connection with this
Agreement or any other Credit 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
Credit Document or any other agreement, instrument or document or (v) the
satisfaction of any condition set forth in Article III or elsewhere
herein, other than to confirm receipt of items expressly required to be
delivered to the Administrative Agent.

Section
8.4            Reliance
by Administrative Agent.  The Administrative Agent shall be entitled to
rely upon, and shall not incur any liability for relying upon, any notice,
request, certificate, consent, statement, instrument, document or other writing
(including any electronic message, Internet or intranet website posting or
other distribution) believed by it to be genuine and to have been signed, sent
or otherwise authenticated by the proper Person.  The Administrative Agent also may rely upon
any statement made to it orally or by telephone and believed by it to have been
made by the proper Person, and shall not incur any liability for relying thereon.  In determining compliance with any condition
hereunder to the making of a Credit Extension that by its terms must be
fulfilled to the satisfaction of a Lender or an Issuing Lender, the
Administrative Agent may presume that such condition is satisfactory to such
Lender or Issuing Lender unless the Administrative Agent shall have received
notice to the contrary from such Lender or Issuing Lender prior to the making
of such Credit Extension.  The
Administrative Agent may consult with legal counsel (who may be counsel for the
Parent or the Borrower), independent accountants and other experts selected by
it, and shall not be liable for any action taken or not taken by it in
accordance with the advice of any such counsel, accountants or experts.

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

Section
8.6            Resignation
of Administrative Agent or Issuing Lender.  The Administrative Agent and Wells Fargo, as
an Issuing Lender, may at any time give notice of its resignation to the other
Lender Parties and the Borrower; provided, however that Wells Fargo may
not resign as Issuing Lender unless it is concurrently resigning as
Administrative Agent.  Upon receipt of
any such notice of resignation, the Majority Lenders shall have the right, with
the approval of the Borrower unless an Event of Default has occurred and is
continuing, to appoint a successor Administrative Agent and a successor Issuing
Lender.  If no such successor shall have
been so appointed and shall have accepted such appointment within 30 days
after Wells Fargo gives notice of its resignation, then Wells Fargo may on
behalf of the Lenders, appoint a successor agent and issuing lender with the
approval of the Borrower (such approval not to be unreasonably withheld or
delayed) unless an Event of Default has occurred and is continuing.  Once a Person has accepted such appointment,
then such resignation shall become effective in accordance with such notice and
Wells Fargo shall be discharged from its duties and obligations as
Administrative Agent and Issuing Lender hereunder and under the other Credit
Documents (except that Wells Fargo shall remain the Issuing Lender with respect
to any Letters of Credit outstanding on the effective date of its

 54
 

 

resignation and the
provisions affecting the Issuing Lender with respect to such Letters of Credit
shall inure to the benefit of Wells Fargo until the termination of all such
Letters of Credit).  Upon the acceptance
of a successor’s appointment as Administrative Agent or Issuing Lender
hereunder, such successor shall succeed to and become vested with all of the
rights, powers, privileges and duties of the retiring (or retired)
Administrative Agent or Issuing Lender, as applicable, and the retiring
Administrative Agent or Issuing Lender, as applicable, shall be discharged from
all of its duties and obligations hereunder or under the other Credit Documents
(if not already discharged therefrom as provided above in this paragraph).  The fees payable by the Borrower to a
successor Administrative Agent or Issuing Lender, as applicable shall be the
same as those payable to its predecessor unless otherwise agreed between the
Borrower and such successor.  After the
retiring Administrative Agent’s or Issuing Lender’s resignation hereunder and
under the other Credit Documents, the provisions of this Article and Sections
9.1(b), (c), and (d) and Section 2.3(h) shall continue in effect for the
benefit of such retiring Administrative Agent and Issuing Lender, 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 or Issuing
Lender, as applicable, was acting as Administrative Agent or Issuing Lender.

Section
8.7            Non-Reliance
on Administrative Agent and Other Lenders.  Each Lender Party acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other
Lender Party 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 Party also acknowledges that it will, independently and
without reliance upon the Administrative Agent or any other Lender Party 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
Credit Document or any related agreement or any document furnished hereunder or
thereunder.

Section
8.8            No
Other Duties, etc. 
Anything herein to the contrary notwithstanding, none of the Joint
Bookrunners, Co-Lead Arrangers, Syndication Agent and Co-Documentation Agents
listed on the cover page hereof shall have any powers, duties or
responsibilities under this Agreement or any of the other Credit Documents,
except in its capacity, as applicable, as the Administrative Agent, a Lender or
an Issuing Lender hereunder.

ARTICLE IX

MISCELLANEOUS

Section
9.1            Expenses;
Indemnity; Damage Waiver.

(a)     Costs and Expenses.  The Borrower shall pay (i) all
reasonable out-of-pocket expenses incurred by the Administrative
Agent and its Affiliates (including the reasonable fees, charges and
disbursements of counsel for the Administrative Agent), in connection with the
syndication of the credit facilities provided for herein, the preparation,
negotiation, execution, delivery and administration of this Agreement and the
other Credit 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 Issuing Lenders 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 any Lender Party (including the fees, charges and disbursements of
any counsel for any Lender Party), in connection with the enforcement or
protection of its rights (A) in connection with this Agreement and the
other Credit Documents, including its rights under this Section, or (B) in
connection with the Advances 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 Advances or Letters
of Credit.

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(b)     Indemnification by the
Borrower.  The
Borrower shall, and does hereby indemnify, the Administrative Agent (and any
sub-agent thereof), each Lender and each Issuing Lender, and each Related Party
of any of the foregoing Persons (each such Person being called an “Indemnitee”)
against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses (including the fees, charges and
disbursements of any counsel for any Indemnitee), incurred by any Indemnitee or
asserted against any Indemnitee by any third party arising out of, in
connection with, or as a result of (i) the execution or delivery of this
Agreement, any other Credit Document or any agreement or instrument
contemplated hereby or thereby, the performance by the parties hereto of their
respective obligations hereunder or thereunder, the consummation of the
transactions contemplated hereby or thereby, or, in the case of the
Administrative Agent (and any sub-agent thereof) and its Related Parties only,
the administration of this Agreement and the other Credit Documents,
(ii) any Advance or Letter of Credit or the use or proposed use of the
proceeds therefrom (including any refusal by an Issuing Lender 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 Parent,
the Borrower or any Subsidiary, or any Environmental Liability related in any
way to the Parent, the Borrower or any Subsidiary, 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 Parent, the Borrower or any other Credit
Party, and regardless of whether any Indemnitee is a party thereto, IN ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING,
IN WHOLE OR IN PART, OUT OF THE COMPARATIVE, CONTRIBUTORY OR SOLE NEGLIGENCE OF
THE INDEMNITEE; provided that such indemnity shall not, as to
any Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the
gross negligence or willful misconduct of such Indemnitee, if the Borrower or
such other Credit Party has obtained a final and nonappealable judgment in its
favor on such claim as determined by a court of competent jurisdiction.

(c)     Reimbursement by Lenders.  To the extent that the Borrower for any
reason fail to indefeasibly pay any amount required under subsection (a)
or (b) of this Section to be paid by it to the Administrative Agent (or
any sub-agent thereof), any Issuing Lender or any Related Party of any of the
foregoing, each Lender severally agrees to pay to the Administrative Agent (or
any such sub-agent), such Issuing Lender or such Related Party, as the case may
be, such Lender’s Applicable Percentage (determined as of the time that the
applicable unreimbursed expense or indemnity payment is sought) of such unpaid
amount, provided that the unreimbursed expense or indemnified loss,
claim, damage, liability or related expense, as the case may be, was incurred
by or asserted against the Administrative Agent (or any such sub-agent) or such
Issuing Lender in its capacity as such, or against any Related Party of any of
the foregoing acting for the Administrative Agent (or any such sub-agent) or
such Issuing Lender in connection with such capacity.  The obligations of the Lenders under this
subsection (c) are subject to the provisions of Section 2.5(e).

(d)     Waiver of Consequential
Damages, Etc.  To
the fullest extent permitted by applicable law, no Credit Party shall assert,
and each such party hereto 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 Credit Document or any
agreement or instrument contemplated hereby, the transactions contemplated
hereby or thereby, any Advance or Letter of Credit or the use of the proceeds
thereof.

(e)     Electronic Communications.  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

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distributed by it through
telecommunications, electronic or other information transmission systems in
connection with this Agreement or the other Credit Documents or the
transactions contemplated hereby or thereby unless such damages result
from a breach of the confidentiality provisions of Section 9.8 or except where
the same are a result of such party’s gross negligence or willful misconduct.

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

(g)     Survival.  The agreements in this Section shall survive
the resignation of the Administrative Agent and any Issuing Lender, the
replacement of any Lender, the termination of the Commitments, termination or
expiration of all Letters of Credit, and the repayment, satisfaction or
discharge of all the other Obligations.

Section
9.2            Waivers
and Amendments.  No
amendment or waiver of any provision of this Agreement, the Notes, or any other
Credit Document, nor consent to any departure by any Credit Party therefrom,
shall in any event be effective unless the same shall be in writing and signed
by the Majority Lenders and the Borrower, and then such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given; provided that, no such agreement shall (a) increase the
Commitment of any Lender without the written consent of such Lender, (b)
increase the aggregate Revolving Commitments other than pursuant to Section
2.1(c) as in effect on the date hereof without the written consent of each
Lender, (c) reduce the principal amount of any Advance (other than prepayments
or repayments in accordance with the terms of this Agreement) or reduce the
amount of or rate of interest thereon, or reduce any fees payable hereunder,
without the written consent of each Lender affected thereby, (d) postpone the
scheduled date of payment of the principal amount of any Advance, or any
interest thereon, or any fees payable hereunder, or reduce the amount of, waive
or excuse any such payment, or postpone the scheduled date of expiration of any
Commitment, without the written consent of each Lender affected thereby, (e)
change Section 2.13(f), Section 2.5(e), Section
7.6, this Section 9.2 or any other provision in any Credit Document which
expressly requires the consent of, or action or waiver by, all of the Lenders,
(f) amend, modify or waive any provision in a manner that would alter the pro
rata sharing of payments to or disbursements by Lenders required thereby,
without the written consent of each Lender, (g) release any Guarantor from its
obligation under any Guaranty without the written consent of each Lender or (h)
change any of the provisions of this Section or the definition of “Majority
Lenders” or any other provision hereof specifying the number or percentage of
Lenders required to waive, amend or modify any rights hereunder or make any
determination or grant any consent hereunder, without the written consent of
each Lender; provided  further that no such agreement shall amend,
modify or otherwise affect the rights or duties of the Administrative Agent,
the Issuing Lenders or the Swingline Lender hereunder without the prior written
consent of the Administrative Agent, such Issuing Lender or the Swingline
Lender, as the case may be.

Section
9.3            Severability.  In case one or more provisions of this
Agreement or the other Credit Documents shall be invalid, illegal or
unenforceable in any respect under any applicable law, the validity, legality,
and enforceability of the remaining provisions contained herein or therein
shall not be affected or impaired thereby. 
The invalidity of a provision in a particular jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.

Section
9.4            Survival
of Representations and Obligations.  All representations and warranties contained
in this Agreement or made in writing by or on behalf of the Parent or the
Borrower in connection herewith shall survive the execution and delivery of
this Agreement and the other Credit Documents, the making Credit Extensions and
any investigation made by or on behalf of the Lenders, none of which
investigations shall diminish any Lender’s right to rely on such
representations and warranties.  All
obligations of the Borrower provided for in Sections 2.11, 2.12, 2.14(b),
and 9.1(a), (b)

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and (d) and all of the
obligations of the Lenders in Section 9.1(c) and Section 9.8 shall survive any
termination of this Agreement, repayment in full of the Obligations, and
termination or expiration of all Letters of Credit.

Section
9.5            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 the Parent nor the Borrower may assign or otherwise
transfer any of its rights or obligations hereunder without the prior written
consent of each Lender Party and no Lender may assign or otherwise transfer any
of its rights or obligations hereunder except (a) to an Eligible Assignee
in accordance with the provisions of Section 9.6(a), (b) by way of
participation in accordance with the provisions of Section 9.6(d) or
(c) by way of pledge or assignment of a security interest subject to the
restrictions of Section 9.6(e) (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
Section 9.6(c) and, to the extent expressly contemplated hereby, the Related
Parties of the Administrative Agent and each Lender) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

Section 9.6            Lender
Assignments and Participations.

(a)     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 Advances
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 Advances under such Commitment at the time owing to it or in
the case of an assignment to a Lender or an Affiliate of a Lender or an
Approved Fund with respect to a Lender, the aggregate amount of the Commitment
(which for this purpose includes Advances outstanding thereunder) or, if the
Commitment is not then in effect, the principal outstanding balance of the
Advances of the assigning Lender subject to each such assignment (determined as
of the date the Assignment and Assumption with respect to such assignment is
delivered to the Administrative Agent or, if “Trade Date” is specified in the
Assignment and Assumption, as of the Trade Date) shall not be less than
$10,000,000, unless the Administrative Agent and, so long as no Event of
Default has occurred and is continuing, the Borrower otherwise consents (each
such consent not to be unreasonably withheld or delayed); provided, however,
that concurrent assignments to members of an Assignee Group and concurrent
assignments from members of an Assignee Group to a single Eligible Assignee (or
to an Eligible Assignee and members of its Assignee Group) will be treated as a
single assignment for purposes of determining whether such minimum amount has
been met;

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

(iii)          any assignment
of a Commitment must be approved by the Administrative Agent and the Issuing
Lenders (other than BOK if no Existing Letters of Credit are then outstanding)
unless the Person that is the proposed assignee is itself a Lender with a
Revolving Commitment (whether or not the proposed assignee would otherwise
qualify as an Eligible Assignee); and

(iv)          the parties to
each assignment shall execute and deliver to the Administrative Agent an
Assignment and Assumption, together with a processing and recordation fee of
$2,000 (it being understood that only one such processing fee is payable for
the series of concurrent assignments to

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members
of an Assignee Group or the series of concurrent assignments from members of an
Assignee Group to a single Eligible Assignee or to an Eligible Assignee and
members of its Assignee Group) and the Eligible Assignee, if it shall not be a
Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.

Subject to acceptance and
recording thereof by the Administrative Agent pursuant to paragraph (b) 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 2.11, 2.12, 2.14(b), 9.1(a), 9.1(b), 9.1(c), and
9.1(d) with respect to facts and circumstances
occurring prior to the effective date of such assignment.  Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
paragraph 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
paragraph (c) of this Section.

(b)     Register.  The Administrative Agent, acting solely for
this purpose as an agent of the Borrower, shall maintain at one of its offices
in Denver, Colorado or Houston, Texas 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 Revolving Commitments of, and principal amounts of the
Advances owing to, each Lender pursuant to the terms hereof from time to time
(the “Register”). The entries in the Register shall be conclusive absent
manifest error, and the Borrower and the Lender Parties 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.

(c)     Participations.  Any Lender may at any time, without the
consent of, or notice to, the Borrower, the Parent, any other Credit Party or
the Administrative Agent, sell participations to any Person (other than a
natural person or the Parent, the Borrower or any of the Parent’s Affiliates or
other 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 Commitments and/or the Advances owing to it); provided
that (i) such Lender’s obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations and (iii) the
Borrower and the Lender Parties shall continue to deal solely and directly with
such Lender Party in connection with such Lender Party’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, modification or waiver
described in clauses (a), (b), (c) or (d) of this Section 9.6 (that adversely
affects such Participant).  Subject to
paragraph (d) of this Section, the Borrower agrees that each Participant
shall be entitled to the benefits of, and subject to the requirements of,
Sections 2.11, 2.12 and 2.14 to the same
extent as if it were a Lender and had acquired its interest by assignment
pursuant to paragraph (a) of this Section. 
To the extent permitted by law, each Participant also shall be entitled
to the benefits of Section 7.4 as though it
were a Lender, provided such Participant agrees to be subject to Section
2.13(f) as though it were a Lender.

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(d)     Limitations upon Participant
Rights.  A Participant shall not be
entitled to receive any greater payment under Section 2.12 than the applicable
Lender would have been entitled to receive with respect to the participation
sold to such Participant, unless the sale of the participation to such
Participant is made with the Borrower’s prior written consent.  A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 2.14 unless the Borrower is notified of the participation sold
to such Participant and such Participant agrees, for the benefit of the
Borrower, to comply with Section 2.14(d), in which case Section 2.14 shall be
applied as if such Participant had become a Lender and had acquired its
interest by assignment pursuant to paragraph (a) of this Section; provided
that, in no event shall such Participant be entitled to receive any greater
payment under Section 2.14 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant.

(e)     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 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.

Section
9.7            Notices,
Etc.

(a)     Notices Generally.  Except in the case of notices and other
communications expressly permitted to be given by telephone (and except as
provided in paragraph (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 facsimile as
follows: (i) if to the Borrower or any other Credit Party, at the applicable
address (or facsimile numbers) set forth on Schedule III; (ii) if to the
Administrative Agent or an Issuing Lender, at the applicable address (or
facsimile numbers) set forth on Schedule III; and (iii) if to a Lender, to it
at its address (or facsimile number) set forth 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 facsimile 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 paragraph (b) below, shall be
effective as provided in said paragraph (b).

(b)     Electronic Communications.

(i)            The Borrower,
the Parent and the Lenders agree that the Administrative Agent may make any
material delivered by the Borrower, the Parent or any other Credit Party to the
Administrative Agent, as well as any amendments, waivers, consents, and other
written information, documents, instruments and other materials relating to the
Parent, the Borrower, any other Subsidiary, or any other materials or matters
relating to this Agreement, the Notes or any of the transactions contemplated
hereby (collectively, the “Communications”) available to the Lenders by
posting such notices on an electronic delivery system (which may be provided by
the Administrative Agent, an Affiliate of the Administrative Agent, or any
Person that is not an Affiliate of the Administrative Agent), such as
IntraLinks, or a substantially similar electronic system (the “Platform”);
provided that the foregoing shall not apply to notices to any Lender or Issuing
Lender pursuant to Article II if such Lender or Issuing Lender, as applicable,
has notified the Administrative Agent that it is incapable of receiving notices
under such Article by electronic communication. 
The Borrower and the Parent each acknowledges that (i) the distribution
of material through an electronic medium is not necessarily secure and that
there are confidentiality and other risks associated with such distribution,
(ii) the Platform is provided “as is” and “as available” and (iii) none of the Administrative
Agent nor any of

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their
respective Affiliates warrants the accuracy, completeness, timeliness,
sufficiency, or sequencing of the Communications posted on the Platform.  The Administrative Agent and their respective
Affiliates expressly disclaim with respect to the Platform any liability for
errors in transmission, incorrect or incomplete downloading, delays in posting
or delivery, or problems accessing the Communications posted on the Platform
and any liability for any losses, costs, expenses or liabilities that may be
suffered or incurred in connection with the Platform.  No warranty of any kind, express, implied or
statutory, including, without limitation, 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 the Administrative Agent or any
of its Affiliates in connection with the Platform.  Nothing in this Section 9.7(b) shall relieve
the Administrative Agent or any Lender from their obligations under Section
9.8.

(ii)           Each Lender
agrees that notice to it (as provided in the next sentence) (a “Notice”)
specifying that any Communication has been posted to the Platform shall for
purposes of this Agreement constitute effective delivery to such Lender of such
information, documents or other materials comprising such Communication.  Each Lender agrees (i) to notify, on or
before the date such Lender becomes a party to this Agreement, the
Administrative Agent in writing of such Lender’s e-mail address to which a Notice
may be sent (and from time to time thereafter to ensure that the Agent has on
record an effective e-mail address for such Lender) and (ii) that any Notice
may be sent to such e-mail address.

(c)     Change of Address, Etc.  Any party hereto may change its address or
facsimile number for notices and other communications hereunder by notice to
the other parties hereto.

Section
9.8            Confidentiality.  The Administrative Agent, each Lender and
each Issuing Lender 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 other representatives (the “Representatives”)
(it being understood that the Representative 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 Credit Document or any action or proceeding
relating to this Agreement or any other Credit 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 the Parent, the Borrower or any other Subsidiary and
their respective obligations, (g) with the consent of the Parent 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 any Lender Party or any of their respective Affiliates on a
nonconfidential basis from a source other than a Credit Party.  For purposes of this Section, “Information”
means all information received from the Parent, the Borrower or any other
Subsidiary relating to the Parent, the Borrower or any other Subsidiary or any
of their respective businesses, other than any such information that is
available to Lender Party on a nonconfidential basis prior to disclosure by the
Parent, the Borrower or any other Subsidiary. 
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.  The
Administrative Agent, each Lender and each Issuing Lender agrees to be
responsible for any breaches of this Section 9.8 by its Representatives.

 61
 

 

Section
9.9            Business
Loans.  The
Borrower warrants and represents that the Obligations are and shall be for
business, commercial, investment or other similar purposes and not primarily
for personal, family, household or agricultural use, as such terms are used in
Chapter One (“Chapter One”) of the Texas Credit Code.  At all such times, if any, as Chapter One
shall establish a Maximum Rate, the Maximum Rate shall be the “indicated rate
ceiling” (as such term is defined in Chapter One) from time to time in effect.

Section
9.10         Usury
Not Intended.  It is the
intent of the Borrower and each Lender in the execution and performance of this
Agreement and the other Credit Documents to contract in strict compliance with
applicable usury laws, including conflicts of law concepts, governing the
Advances of each Lender including such applicable laws of the State of Texas,
the United States from time to time in effect, and any other jurisdiction whose
laws may be mandatorily applicable to such Lender notwithstanding the other
provisions of this Agreement.  In
furtherance thereof, the Lenders and the Borrower stipulate and agree that none
of the terms and provisions contained in this Agreement or the other Credit
Documents shall ever be construed to create a contract to pay, as consideration
for the use, forbearance or detention of money, interest at a rate in excess of
the Maximum Rate and that for purposes of this Agreement and all other Credit Documents,
“interest” shall include the aggregate of all charges which constitute interest
under such laws that are contracted for, charged or received under this
Agreement or any other Credit Document; and in the event that, notwithstanding
the foregoing, under any circumstances the aggregate amounts taken, reserved,
charged, received or paid on the Obligations, include amounts which by
applicable law are deemed interest which would exceed the Maximum Rate, then
such excess shall be deemed to be a mistake and each Lender receiving same
shall credit the same on the principal of the Obligations owing to such Lender
(or if all such Obligations shall have been paid in full, refund said excess to
the Borrower).  In the event that the
maturity of the Obligations are accelerated by reason of any election of the
holder thereof resulting from any Event of Default under this Agreement or
otherwise, or in the event of any required or permitted prepayment, then such
consideration that constitutes interest may never include more than the Maximum
Rate, and excess interest, if any, provided for in this Agreement or otherwise
shall be canceled automatically as of the date of such acceleration or
prepayment and, if theretofore paid, shall be credited on the applicable
Obligations (or, if the applicable Obligations shall have been paid in full,
refunded to the Borrower of such interest). 
In determining whether or not the interest paid or payable under any
specific contingencies exceeds the Maximum Rate, the Borrower and the Lenders
shall to the maximum extent permitted under applicable law amortize, prorate,
allocate and spread in equal parts during the period of the full stated term of
the Advances all amounts considered to be interest under applicable law at any
time contracted for, charged, received or reserved in connection with the
Obligations.  The provisions of this
Section shall control over all other provisions of this Agreement or the other
Credit Documents which may be in apparent conflict herewith.

Section
9.11         Usury
Recapture.  In the
event the rate of interest chargeable under this Agreement or any other Credit
Document at any time is greater than the Maximum Rate, the unpaid principal
amount of the Obligations shall bear interest at the Maximum Rate until the
total amount of interest paid or accrued on the Obligations equals the amount
of interest which would have been paid or accrued on the Advances if the stated
rates of interest set forth in this Agreement or applicable Credit Document had
at all times been in effect. In the event, upon payment in full of the
Obligations, the total amount of interest paid or accrued under the terms of
this Agreement and the Obligations is less than the total amount of interest
which would have been paid or accrued if the rates of interest set forth in
this Agreement or such Credit Document had, at all times, been in effect, then
the Borrower shall, to the extent permitted by applicable law, pay the
Administrative Agent for the account of the applicable Lender Party an amount
equal to the difference between (i) the lesser of (A) the amount of
interest which would have been charged on Obligations owed to it if the Maximum
Rate had, at all times, been in effect and (B) the amount of interest
which would have accrued on such Obligations if the rates of interest set forth
in this Agreement had at all times been in effect and (ii) the amount of
interest actually paid under this Agreement or any Credit

 62
 

 

Document on Obligations owed
to it.  In the event the any Lender Party
ever receive, collect or apply as interest any sum in excess of the Maximum
Rate, such excess amount shall, to the extent permitted by law, be applied to
the reduction of the principal balance of the Obligations, and if no such
principal is then outstanding, such excess or part thereof remaining shall be
paid to the Borrower.

Section
9.12         Payments
Set Aside.  To the
extent that any payment by or on behalf of the Borrower or any other Credit
Party is made to any Lender Party, or any Lender Party 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 any Lender
Party in its discretion) to be repaid to a trustee, receiver or any other
party, in connection with any proceeding under any Debtor Relief Law or
otherwise, then (a) to the extent of such recovery, the obligation or part
thereof originally intended to be satisfied shall be revived and continued in
full force and effect as if such payment had not been made or such setoff had
not occurred, and (b) each Lender and each Issuing Lender severally agrees to
pay to the Administrative Agent upon demand its applicable share (without
duplication) of any amount so recovered from or repaid by the Administrative
Agent, plus interest thereon from the date of such demand to the date such
payment is made at a rate per annum equal to the applicable Overnight Rate from
time to time in effect, in the applicable currency of such recovery or
payment.  The obligations of the Lenders
and the Issuing Lenders under clause (b) of the preceding sentence shall
survive the payment in full of the Obligations and the termination of this
Agreement.

Section
9.13         Governing
Law; Submission to Jurisdiction.

(a)     Governing Law.  This Agreement, the Notes and the other
Credit Documents (unless otherwise expressly provided therein) shall be
governed by, and construed and enforced in accordance with, the laws of the
State of Texas.  Without limiting the
intent of the parties set forth above, (a) Chapter 346 of the Texas Finance
Code, as amended (relating to revolving loans and revolving tri-party accounts
(formerly Tex.  Rev.  Civ. 
Stat.  Ann.  Art. 
5069, Ch.  15)), shall not apply
to this Agreement, the Notes, or the transactions contemplated hereby and (b)
to the extent that any Lender may be subject to Texas law limiting the amount
of interest payable for its account, such Lender shall utilize the indicated
(weekly) rate ceiling from time to time in effect.

(b)     Submission to Jurisdiction.  The Parent and the Borrower irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of any Federal or Texas state court sitting in Harris County, and
any appellate court from any thereof, in any action or proceeding arising out
of or relating to this Agreement or any other Credit Document, or for
recognition or enforcement of any judgment, and each of the parties hereto
irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in such Texas State court or,
to the fullest extent permitted by applicable law, in such Federal court.  Each of the parties hereto agrees that a
final judgment in any such action or proceeding 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 Credit Document shall affect any right that any Lender
Party may otherwise have to bring any action or proceeding relating to this
Agreement or any other Credit Document against any Credit Party or its
properties in the courts of any jurisdiction.

(c)     Waiver of Venue.  The Borrower and the Parent 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
Credit 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.

 63
 

 

(d)     Service of Process.  Each party hereto irrevocably consents to
service of process in any manner permitted by applicable law.

Section
9.14         Execution
and Effectiveness.

(a)     Execution in Counterparts.  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 Credit Documents, and any separate letter agreements
with respect to fees payable to the Administrative Agent, 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.   This
Agreement shall become effective when it shall have been executed by the
Administrative Agent and when the Administrative Agent shall have received
counterparts hereof that, when taken together, bear the signatures of each of
the other parties hereto.  Delivery of an
executed counterpart of a signature page of this Agreement by telecopy shall be
effective as delivery of a manually executed counterpart of this Agreement.

(b)     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, or any state laws based on the Uniform
Electronic Transactions Act.

Section
9.15         Waiver
of 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 CREDIT
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 CREDIT DOCUMENTS
BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

Section
9.16         USA
PATRIOT ACT Notice.  Each
Lender that is subject to the Act (as hereinafter defined) and the Administrative
Agent (for itself and not on behalf of any Lender) hereby notifies the Borrower
and the Parent that pursuant to the requirements of the USA Patriot Act (Title
III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”),
it is required to obtain, verify and record information that identifies the
Borrower and the Parent, which information includes the name and address of the
Borrower and the Parent and other information that will allow such Lender or
the Administrative Agent, as applicable, to identify the Borrower and the
Parent in accordance with the Act.  Promptly following a request from the
Administrative Agent, a Lender, or Issuing Lender, the Borrower and the Parent
hereby agree to deliver all documentation and other information that the Administrative
Agent, a Lender, or an Issuing Lender, as applicable, may reasonably request in
order to comply with its ongoing obligations under applicable “know your
customer” and anti-money laundering rules and regulations, including the Act.

 64
 

 

PURSUANT TO
SECTION 26.02 OF THE TEXAS BUSINESS AND COMMERCE CODE, A LOAN AGREEMENT IN
WHICH THE AMOUNT INVOLVED IN THE LOAN AGREEMENT EXCEEDS $50,000.00 IN VALUE IS
NOT ENFORCEABLE UNLESS THE LOAN AGREEMENT IS IN WRITING AND SIGNED BY THE PARTY
TO BE BOUND OR THAT PARTY’S AUTHORIZED REPRESENTATIVE.

THE RIGHTS
AND OBLIGATIONS OF THE PARTIES TO AN AGREEMENT SUBJECT TO THE PRECEDING
PARAGRAPH SHALL BE DETERMINED SOLELY FROM THE WRITTEN LOAN AGREEMENT, AND ANY
PRIOR ORAL AGREEMENTS BETWEEN THE PARTIES ARE SUPERSEDED BY AND MERGED INTO THE
LOAN AGREEMENT.  THIS WRITTEN AGREEMENT
AND THE CREDIT DOCUMENTS, AS DEFINED IN THIS AGREEMENT, REPRESENT THE FINAL
AGREEMENT AMONG THE PARTIES WITH RESPECT TO THE SUBJECT MATTERS SET FORTH
HEREIN AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.

THERE ARE
NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

[Remainder of this page intentionally left
blank.  Signature pages follow.]

 65

 

 

EXECUTED as of the date first above written.

	
  BORROWER:

  	
  HELMERICH
  & PAYNE INTERNATIONAL

  DRILLING CO.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Douglas Fears

  
	
   

  	
   

  	
  Executive Vice
  President and Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  PARENT:

  	
  HELMERICH & PAYNE, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Douglas Fears

  
	
   

  	
   

  	
  Vice President and Chief Financial Officer

  

 

 

 

Signature page to Credit
Agreement

(Helmerich & Payne
International Drilling Co.)

 

 

	
  LENDER PARTIES:

  	
  WELLS
  FARGO BANK,

  
	
   

  	
  NATIONAL ASSOCIATION

  
	
   

  	
  as Administrative Agent,
  Swingline Lender, Issuing

  Lender and a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Philip C. Lauinger III

  
	
   

  	
   

  	
  Vice President

  

 

 

 

Signature page to Credit
Agreement

(Helmerich & Payne
International Drilling Co.)

 

 

	
  

  	
  JPMORGAN CHASE BANK, N.A.

  
	
   

  	
  as Syndication Agent and a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
						

 

 

 

Signature page to Credit
Agreement

(Helmerich & Payne
International Drilling Co.)

 

 

	
  

  	
  THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.

  
	
   

  	
  as Co-Documentation Agent and a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
						

 

 

 

Signature page to Credit
Agreement

(Helmerich & Payne
International Drilling Co.)

 

 

	
  

  	
  CITIBANK, N.A.

  
	
   

  	
  as Co-Documentation Agent and a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
						

 

 

 

Signature page to Credit
Agreement

(Helmerich & Payne
International Drilling Co.)

 

 

	
  

  	
  FORTIS CAPITAL CORP.

  
	
   

  	
  as Co-Documentation Agent and a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
						

 

 

 

Signature page to Credit
Agreement

(Helmerich & Payne
International Drilling Co.)

 

 

	
  

  	
  BANK OF OKLAHOMA, N.A.

  
	
   

  	
  as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
						

 

 

 

Signature page to Credit
Agreement

(Helmerich & Payne
International Drilling Co.)

 

 

	
  

  	
  BANK OF AMERICA, N.A.

  
	
   

  	
  as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
						

 

Signature page to Credit
Agreement

(Helmerich & Payne
International Drilling Co.)

 

 

	
  

  	
  MIDFIRST BANK

  
	
   

  	
  as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
						

 

 

 

Signature page to Credit
Agreement

(Helmerich & Payne International
Drilling Co.)

 

 

	
  

  	
  COMMERCE BANK, N.A.

  
	
   

  	
  as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
						

 

 

 

Signature page to Credit
Agreement

(Helmerich & Payne
International Drilling Co.)

 

 

	
  

  	
  UMB BANK

  
	
   

  	
  as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
						

 

 

 

Signature page to Credit
Agreement

(Helmerich & Payne
International Drilling Co.)

 

 

SCHEDULE I

Pricing
Schedule

The Applicable Margin with
respect to Commitment Fees and Advances shall be determined in accordance with
the following Table based on the Parent’s Funded Leverage Ratio as reflected in
the Compliance Certificate delivered in connection with the Financial
Statements most recently delivered pursuant to Section 5.2.  Adjustments, if any, to such Applicable
Margin shall be effective on the date the Administrative Agent receives the
applicable Financial Statements and corresponding Compliance Certificate as
required by the terms of this Agreement. 
If the Parent fails to deliver the Financial Statements and
corresponding Compliance Certificate to the Administrative Agent at the time
required pursuant to Section 5.2, then effective as of the date such Financial
Statements and Compliance Certificate were required to the delivered pursuant
to Section 5.2, the Applicable Margin with respect to Commitment Fees and
Advances shall be determined at Level IV and shall remain at such level until
the date such Financial Statements and corresponding Compliance Certificate are
so delivered by the Parent.  
Notwithstanding the foregoing, the Parent shall be deemed to be at Level
II described in Table below until delivery of its audited Financial Statements
and corresponding Compliance Certificate for the fiscal year ending December
31, 2006.

	
  Applicable

  Margin

  	
   

  	
  Funded Leverage Ratio

  	
   

  	
  Eurodollar

  Margin

  	
   

  	
  Base Rate

  Margin

  	
   

  	
  Commitment

  Fee

  	
   

  
	
  Level
  I

  	
   

  	
  Is less than or equal
  to 10%

  	
   

  	
  .30

  	
  %

  	
  0.00

  	
  %

  	
  0.050

  	
  %

  
	
  Level
  II

  	
   

  	
  Is greater than 10% but
  less than or equal to 25%

  	
   

  	
  .35

  	
  %

  	
  00.00

  	
  %

  	
  0.075

  	
  %

  
	
  Level
  III

  	
   

  	
  Is greater than 25% but
  less than or equal to 40%

  	
   

  	
  .40

  	
  %

  	
  0.00

  	
  %

  	
  0.100

  	
  %

  
	
  Level IV

  	
   

  	
  Is greater than 40%

  	
   

  	
  .45

  	
  %

  	
  0.00

  	
  %

  	
  0.125

  	
  %

  

 

 1

 

 

SCHEDULE
II

Revolving
Commitments

	
  Lenders

  	
   

  	
  Revolving Commitment

  	
   

  
	
  Wells Fargo Bank,
  National Association

  	
   

  	
  $

  	
  70,000,000

  	
   

  
	
  JPMorgan Chase Bank,
  N.A.

  	
   

  	
  $

  	
  70,000,000

  	
   

  
	
  The Bank of
  Tokyo-Mitsubishi UFJ, Ltd.

  	
   

  	
  $

  	
  45,000,000

  	
   

  
	
  Citibank, N.A.

  	
   

  	
  $

  	
  45,000,000

  	
   

  
	
  Fortis Capital Corp.

  	
   

  	
  $

  	
  45,000,000

  	
   

  
	
  Bank of Oklahoma, N.A.

  	
   

  	
  $

  	
  30,000,000

  	
   

  
	
  Bank of America, N.A.

  	
   

  	
  $

  	
  30,000,000

  	
   

  
	
  MidFirst Bank

  	
   

  	
  $

  	
  25,000,000

  	
   

  
	
  Commerce Bank

  	
   

  	
  $

  	
  25,000,000

  	
   

  
	
  UMB Bank

  	
   

  	
  $

  	
  15,000,000

  	
   

  
	
  TOTAL:

  	
   

  	
  $

  	
  400,000,000

  	
   

  

 

 1

 

SCHEDULE III

Notice Information

	
  ADMINISTRATIVE AGENT AND ISSUING LENDER

  
	
   

  
	
  Wells Fargo Bank, National Association

  	
   

  	
  Address:

  	
   

  	
  1740 Broadway, MAC C7300-034

  
	
   

  	
   

  	
   

  	
   

  	
  Denver, CO 80209

  
	
   

  	
   

  	
  Attn:

  	
   

  	
  David McEvoy, Syndications Specialist

  
	
   

  	
   

  	
  Telephone:

  	
   

  	
  (303) 863-5938

  
	
   

  	
   

  	
  Facsimile:

  	
   

  	
  (303) 863-5533

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  with a copy to:

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
   

  	
  1000 Louisiana, 9th Floor

  
	
   

  	
   

  	
   

  	
   

  	
  MAC T5002-090

  
	
   

  	
   

  	
   

  	
   

  	
  Houston, Texas 77002

  
	
   

  	
   

  	
  Attn:

  	
   

  	
  Philip C. Lauinger III, Vice President

  
	
   

  	
   

  	
   

  	
   

  	
  & Senior Relationship Manager

  
	
   

  	
   

  	
  Telephone:

  	
   

  	
  (713) 319-1313

  
	
   

  	
   

  	
  Facsimile:

  	
   

  	
  (713) 739-1087

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ISSUING
  LENDER

  
	
   

  
	
  Bank of Oklahoma, N.A.

  	
   

  	
  Address:

  	
   

  	
   

  
	
   

  	
   

  	
  Attn:

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Credit
  Parties

  
	
   

  
	
  Borrower and Guarantors

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
   

  	
  1437 South Boulder Ave.

  
	
   

  	
   

  	
   

  	
   

  	
  Tulsa, Oklahoma 74119

  
	
   

  	
   

  	
  Attn:

  	
   

  	
  Douglas E. Fears,

  
	
   

  	
   

  	
   

  	
   

  	
  Vice President and Chief Financial Officer

  
	
   

  	
   

  	
  Telephone:

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  with a copy to:

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
   

  	
  1437 South Boulder Ave.

  
	
   

  	
   

  	
   

  	
   

  	
  Tulsa, Oklahoma 74119

  
	
   

  	
   

  	
  Attn:

  	
   

  	
  Steve Mackey, General Counsel

  
	
   

  	
   

  	
  Telephone:

  	
   

  	
  918-588-5432

  
	
   

  	
   

  	
  Facsimile:

  	
   

  	
  918-743-2671

  

 

 

 

SCHEDULE IV

Existing Letters of Credit

	
  Reference No.

  	
   

  	
  Beneficiary

  	
   

  	
  Issue Date

  	
   

  	
  Maturity Date

  	
   

  	
  Original Amount

  	
   

  	
  Current Liability

  	
   

  
	
  BOK04SDF02122

  	
   

  	
  NATIONAL UNION FIRE
  INSURANCE

  	
   

  	
  10/12/2004

  	
   

  	
  10/04/2007

  	
   

  	
  494,915.00

  	
   

  	
  1,188,915.00

  	
   

  
	
  BOK00SDF06739

  	
   

  	
  NATIONAL UNION FIRE INSURANCE

  	
   

  	
  03/09/2000

  	
   

  	
  10/02/2007

  	
   

  	
  7,171,000.00

  	
   

  	
  19,750,000.00

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00114-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00114-of-00352.parquet"}]]